Agree, but the UBS shareholders should have a chance as well. I think that's where the loudest noise will come from.
Market is going to be wild tomorrow.
OT: Stock and Investment Talk
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Agree, but the UBS shareholders should have a chance as well. I think that's where the loudest noise will come from.
Market is going to be wild tomorrow.
Hard to win a lawsuit against the guys that make the laws.
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anon_0k9zlfz6lz9oy
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anon_0k9zlfz6lz9oy
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yields up early on. Surprised. Obviously been super volatile past couple weeks so we'll see what happens tomorrow
Fed will raise 25 bps. The only question is will they take the “wait and see” approach or back to the regular programming. A lot will depend on data. Treasuries have been over bought as a flight to safety trade but hope we don’t get any where close to 4% 10yr again.
I was in Europe for a conference. Met with a lot of banks. The funny thing is they were more concerned with SVB than CS. From their perspective, CS going under is not news. One banker said CS has been going out of business for the last 3 years.
Some would say they’ve been slowly going under since the GFC
It would if there was an actual systemic banking crisis, which there isn’t. The credit suisse thing is wholly separate from the isolated banking issues in the US and is rooted in just piss-poor management at that institution over the last 2 decades.
Unrealized losses aren’t a problem unless there is some sort of broad spectrum catalyst that causes a massive outflow of deposits across numerous banking institutions. In the case of US banks, it would be a completely fear-driven (not fact driven) depositor reaction to pull money out. Other banks and the fed are aware of this, therefore they will inject whatever is necessary to prevent an illogical fear based reaction. The alternative is a cascade of unwarranted panic, therefore the infusion of liquidity is justified and relatively small given the size of the banks receiving aid, so a dollar crisis is off the table.
Some say all of this is a shot across the bow by the government regarding crypto but I don’t buy that.
Let's get this QE3 party started! .25% is just to save face. We all know where this is heading.
The Fed screwed up the entire banking system with such reckless rate increases. The Fed is responsible for overseeing banks. They know what was going on with durations. They miscalculated and thought it would be fine. Never foresaw runs just like they never foresaw mortgage defaults in 2008.
FDIC announces agreement to sell Signature Bank assets to New York Community Bancorp subsidiary
Flagstar Bank, the subsidiary, will assume substantially all deposits and certain loan portfolios, and all 40 of Signature Bank's former branches.
Just because you say it over and over agin, doesn’t make true. CS has been in trouble before the rate increase. Signatur bank was doomed by FTX. Most bank actually benefit from the carry trade.
Talking US banks, not CS. Many banks have the same issue as SVB. The Fed lit the fuse.....once again.
No, not true at all. Many banks do not have the same issue as SVB. Banks will have issues with their real estate loan portfolio but won’t be serious enough to cause a crisis.
I get that but you're saying continued money printing won't eventually cause the dollar to fail with big inflation caused by the re-easing of monetary policy? Or are you saying we're just not there yet?
I'm asking because I'm seeing elsewhere it's getting to either/or time. Save the banks with money and kill the $ or let the banks die while defending the $ and fighting inflation.
just look at the FX market. Dollar is not getting weaker. It’s not printing money to fuel spending or lending.
It's a shit sandwich or shit sub choice.
All the good/reasonable choices have left the building. Rocky ride going forward for everybody. Good luck to anybody thinking otherwise
There were also the periods of interest rates near zero
There are things I often hear warnings about and nothing is done to prevent them.
I hear from experts that the grid is deteriorating and that an EMP blast is a legit threat but nothing seems to be dont about them.
I also heard for years that if there was too much debt, an interest rate increase could be devastating.
The other thing I always saw warnings about were derivatives.
Nobody can guarantee those are well tracked.
I remember in 2008 WSJ ran an article about how computer models had failed firms because red flags never went up as planned - they were measuring the wrong variables.
Computers alone can't make-up for complexities when there is a dispersal of responsibilities - business people assuming tech people have things monitored and tech people assuming business people have things in control. Often turns up nobody has things under control.
Chase alone has 65-70 trillion in derivatives according to reports.
"Measurement is at the root of science, and it ought to be at the root of economics. One of the problems that I think we’ve been aware of for a while is that when you have derivatives, traditional methods of measuring are not effective."
Interview with Gary Gorton | Federal Reserve Bank of Minneapolis
Yale University finance economist on the growth and collapse of shadow banking.
www.minneapolisfed.org
Yale Professor Who Had Controversial Role in the Crisis Now Teaches About It
This spring, Gary Gorton taught a class at Yale on financial crises. It’s a topic the 66-year-old knows about firsthand as the academic behind AIG’s controversial risk models.
www.wsj.com
Warren Buffet
"The derivatives genie is now well out of the bottle, and these instruments will almost certainly multiply in variety and number until some event makes their toxicity clear. Central banks and governments have so far found no effective way to control, or even monitor, the risks posed by these contracts. In my view, derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are
potentially lethal."
the only thing the Fed is doing wrong is not restricting lending
that is the grandslam here
that is the grandslam here
Looks like FRC is up big in the pre hours. Maybe you were right originally.
Fed should start the day with; no more rate hikes but requiring banks to keep 5% more reserves.
Guaranteeing depositors was stupid, politically driven
unfortunately, credit creation is not abating
Guaranteeing depositors was stupid, politically driven
unfortunately, credit creation is not abating
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