Silicon Valley Bank

[jerryskids 7,201]

20 minutes ago, GutterBoy said:

You made the statement, I proved you wrong, I have no interest in playing your games.  I'm sorry you're butthurt on being called out for your stupidity.  You only have yourself to be upset with.

You didn't prove him wrong.  Technically he is correct -- until a new limit is set, there is no limit.  

[TimHauck 3,447]

Holy sh1t HT is retarded.  Obviously not all banks would fail if there was panic about SVB/Signature.  But some of the smaller regional ones could have.

[GutterBoy 2,900]

8 minutes ago, jerryskids said:

You didn't prove him wrong.  Technically he is correct -- until a new limit is set, there is no limit.  

I thought you went to MIT?

[GutterBoy 2,900]

11 minutes ago, Hardcore troubadour said:

Yeah I do. And where are they going to transfer it to? Another bank, that’s where  Bank run my ass. And Timmy was using 1933 as an example.  But you don’t tell him how stupid that is. 

Yeah you don't understand how a bank run works.  Tap out.

[Hardcore troubadour 16,062]

Just now, TimHauck said:

Holy sh1t HT is retarded.  Obviously not all banks would fail if there was panic about SVB/Signature.  But some of the smaller regional ones could have.

Why? Did the majority of their depositors have way more than 250k, like SVB? Those deposits were insured. 

[Hardcore troubadour 16,062]

Just now, GutterBoy said:

Yeah you don't understand how a bank run works.  Tap out.

Sure. I’m going to go get my money out of the bank and put it in another bank! Bank run! 

[Hardcore troubadour 16,062]

2 minutes ago, GutterBoy said:

Yeah you don't understand how a bank run works.  Tap out.

Ok, explain some things to me. Where was the depositors money, in treasuries? 

[jerryskids 7,201]

8 minutes ago, GutterBoy said:

I thought you went to MIT?

Ooh, good one.  Do you have a point, Slingblade?

[GutterBoy 2,900]

8 minutes ago, jerryskids said:

Ooh, good one.  Do you have a point, Slingblade?

There is a limit. Just because I don't know what the limit is, doesn't mean it doesn't exist.

[jerryskids 7,201]

3 minutes ago, GutterBoy said:

There is a limit. Just because I don't know what the limit is, doesn't mean it doesn't exist.

So you believe that somebody with proper authority could tell you the limit, were they so inclined?

[GutterBoy 2,900]

14 minutes ago, Hardcore troubadour said:

Ok, explain some things to me. Where was the depositors money, in treasuries? 

See the way banks work, is people deposit money, and then the bank invests that money elsewhere.  Svb invested in long term treasuries, among other things yes

[GutterBoy 2,900]

1 minute ago, jerryskids said:

So you believe that somebody with proper authority could tell you the limit, were they so inclined?

I don't know, but I'm fairly certain they would agree that there is a limit.

[Hardcore troubadour 16,062]

1 minute ago, GutterBoy said:

See the way banks work, is people deposit money, and then the bank invests that money elsewhere.  Svb invested in long term treasuries, among other things yes

Ok. So what happens to the money in the treasuries? 

[jerryskids 7,201]

2 minutes ago, GutterBoy said:

I don't know, but I'm fairly certain they would agree that there is a limit.

So the next time this happens they'll look at all of the deposits and determine if any one person would get an amount of money back that they aren't comfortable with, and at that point set a limit?  And this is your "proof" that there is a limit?

This is near "there is a limit at all of the money in the world$#@!" territory.   

[GutterBoy 2,900]

4 minutes ago, Hardcore troubadour said:

Ok. So what happens to the money in the treasuries? 

They were selling the treasuries for a loss because interest rates rose.  If there wasn't a run, then they could have held the bonds and not taken the loss

Quick lesson on bonds, as rates rise, the value of the bond falls.  If you hold the bond to maturity then you're fine.  Do you know what a bond is or want me to explain?

[Hardcore troubadour 16,062]

6 minutes ago, GutterBoy said:

They were selling the treasuries for a loss because interest rates rose.  If there wasn't a run, then they could have held the bonds and not taken the loss

Quick lesson on bonds, as rates rise, the value of the bond falls.  If you hold the bond to maturity then you're fine.  Do you know what a bond is or want me to explain?

Bond = debt. So, these treasuries they have left, are they still selling them? 

[GutterBoy 2,900]

Just now, Hardcore troubadour said:

Bond = debt. So, these treasuries they have left, are they still selling them? 

Well the bank was seized by the govt.  I don't know what is left on their balance sheet or what this bridge bank plans to do.

[Mike Honcho 5,553]

Is this a spinoff of the original show?  Does it still have Amanda Crew? 

[GutterBoy 2,900]

1 minute ago, Mike Honcho said:

Is this a spinoff of the original show?  Does it still have Amanda Crew? 

One of my all time favorites 

[Strike 6,036]

16 minutes ago, GutterBoy said:

They were selling the treasuries for a loss because interest rates rose.  If there wasn't a run, then they could have held the bonds and not taken the loss

Quick lesson on bonds, as rates rise, the value of the bond falls.  If you hold the bond to maturity then you're fine.  Do you know what a bond is or want me to explain?

They may not have folded like they did, but they sure as hell wouldn't have been fine.  They had 10 year bonds paying like 1.5% when the interest rate has gone up.  People should expect to earn at least 3-4% with current interest rates so this bank would not be competitive offering 1% returns to their customers.   Banks have been lagging on this issue so it may not have caught up to them YET but it sure as hell would have.

[GutterBoy 2,900]

4 minutes ago, Strike said:

They may not have folded like they did, but they sure as hell wouldn't have been fine.  They had 10 year bonds paying like 1.5% when the interest rate has gone up.  People should expect to earn at least 3-4% with current interest rates so this bank would not be competitive offering 1% returns to their customers.   Banks have been lagging on this issue so it may not have caught up to them YET but it sure as hell would have.

Well what they offer their customers is not really impacted by their treasury holdings.  If managed properly they would also have shorter term debt among other investments.  They were mismanaged.

[TimHauck 3,447]

2 hours ago, Alias Detective said:

It seems to me precedent has been set.  There is ZERO limit on what the FDIC will cover.  Tell me I am wrong?

Not really, although technically it seems there was never a limit, provided covering the higher amount protects against "systemic risk."  This doesn't necessarily mean that if any bank goes under (smaller ones, for example) that all deposits will be covered.   "Too big to fail" is probably true here, although yes it technically did fail.  Signature bank may have gotten lucky with their timing, they may not have gotten the same deal if they were the only bank to fail.

[Hardcore troubadour 16,062]

17 minutes ago, GutterBoy said:

Well the bank was seized by the govt.  I don't know what is left on their balance sheet or what this bridge bank plans to do.

Ok. So I’m going to call this half a bailout. And it may have been the right thing to do. And I think they used the bank run thing to drum up fear to get it done quick. 

[Strike 6,036]

9 minutes ago, GutterBoy said:

Well what they offer their customers is not really impacted by their treasury holdings.  If managed properly they would also have shorter term debt among other investments.  They were mismanaged.

You could have just said Yes Strike, as usual you're right and I'm wrong.

[TimHauck 3,447]

 

 

 

[GutterBoy 2,900]

5 minutes ago, Strike said:

You could have just said Yes Strike, as usual you're right and I'm wrong.

You assumed that they would offer a lower rate to their account holders because they hold some treasuries at a lowe rate.  That's a false assumption 

[GutterBoy 2,900]

13 minutes ago, Hardcore troubadour said:

Ok. So I’m going to call this half a bailout. And it may have been the right thing to do. And I think they used the bank run thing to drum up fear to get it done quick. 

Ok so half a bailout but you still don't believe there was a bank run.  I guess this is progress 

[Strike 6,036]

1 minute ago, GutterBoy said:

You assumed that they would offer a lower rate to their account holders because they hold some treasuries at a lowe rate.  That's a false assumption 

No.  If they weren't overleveraged on these bad bond investments they wouldn't have been taken over by the government.  So we KNOW this was a significant amount of their investment portfolio.  Certainly they would have had some higher return shorter term investments but I don't find it plausible that they would have enough of those types of investments to overcome their overleveraged long term investments.  The fact that they failed is evidence of that.

[GutterBoy 2,900]

4 minutes ago, Strike said:

No.  If they weren't overleveraged on these bad bond investments they wouldn't have been taken over by the government.  So we KNOW this was a significant amount of their investment portfolio.  Certainly they would have had some higher return shorter term investments but I don't find it plausible that they would have enough of those types of investments to overcome their overleveraged long term investments.  The fact that they failed is evidence of that.

Again this has nothing to do with what they would offer on customer savings accounts 

[Strike 6,036]

Just now, GutterBoy said:

Again this has nothing to do with what they would offer on customer savings accounts 

Of course it does.  Where do you think they get the money to pay interest?  From their investments.  If their investments aren't paying competitive rates neither are they. 

[GutterBoy 2,900]

2 minutes ago, Strike said:

Of course it does.  Where do you think they get the money to pay interest?  From their investments.  If their investments aren't paying competitive rates neither are they. 

I'm not in the banking industry, but I would have to assume that they would be competitive with the market to attract customers, and find other ways to increase revenue.  I highly doubt it's the reverse.

In fact I'm fairly certain that true because I've never seen a bank cut their savings account rate based on them losing money. 

[Strike 6,036]

Just now, GutterBoy said:

I'm not in the banking industry, but I would have to assume that they would be competitive with the market to attract customers, and find other ways to increase revenue.  I highly doubt it's the reverse.

In fact I'm fairly certain that true because I've never seen a bank cut their savings account rate based on them losing money. 

You can handle it for a while.  Most businesses don't adjust their prices immediately when their costs go up.  They can absorb them to an extent and for a period of time.  But not for 10 years.   I'm not saying they would have gone belly up.  I'm saying they weren't healthy regardless of how last week went and even if there hadn't been a bank run.  That's pretty obvious. 

[GutterBoy 2,900]

Just now, Strike said:

You can handle it for a while.  Most businesses don't adjust their prices immediately when their costs go up.  They can absorb them to an extent and for a period of time.  But not for 10 years.   I'm not saying they would have gone belly up.  I'm saying they weren't healthy regardless of how last week went and even if there hadn't been a bank run.  That's pretty obvious. 

Ok so if you're changing the story to them not being healthy then I agree, I think it's a fairly obvious statement 

[Strike 6,036]

1 hour ago, GutterBoy said:

They were selling the treasuries for a loss because interest rates rose.  If there wasn't a run, then they could have held the bonds and not taken the loss

Quick lesson on bonds, as rates rise, the value of the bond falls.  If you hold the bond to maturity then you're fine.  Do you know what a bond is or want me to explain?

Above is the post I responded to.  Specifically, the bolded.  Below is my reply.  Note the bolded:

43 minutes ago, Strike said:

They may not have folded like they did, but they sure as hell wouldn't have been fine.  They had 10 year bonds paying like 1.5% when the interest rate has gone up.  People should expect to earn at least 3-4% with current interest rates so this bank would not be competitive offering 1% returns to their customers.   Banks have been lagging on this issue so it may not have caught up to them YET but it sure as hell would have.

 

1 minute ago, GutterBoy said:

Ok so if you're changing the story to them not being healthy then I agree, I think it's a fairly obvious statement 

So, no changing story.  Just your lack of reading comprehension skills. 

[GutterBoy 2,900]

5 minutes ago, Strike said:

Above is the post I responded to.  Specifically, the bolded.  Below is my reply.  Note the bolded:

 

So, no changing story.  Just your lack of reading comprehension skills. 

So it was your lack of comprehension that started this.  My quick lesson on bonds to tardcore was to explain that if you hold a bond to maturity then you're fine, you don't lose your initial investment.  It's only if you want to sell before maturity then you only get what the bond is worth at that point.  It wasn't specific to svb. Hope that makes sense to you.

[Strike 6,036]

2 minutes ago, GutterBoy said:

So it was your lack of comprehension that started this.  My quick lesson on bonds to tardcore was to explain that if you hold a bond to maturity then you're fine, you don't lose your initial investment.  It's only if you want to sell before maturity then you only get what the bond is worth at that point.  It wasn't specific to svb. Hope that makes sense to you.

Bullsh*t.  Here is your post, AGAIN:

Quote

 

They were selling the treasuries for a loss because interest rates rose.  If there wasn't a run, then they could have held the bonds and not taken the loss

Quick lesson on bonds, as rates rise, the value of the bond falls.  If you hold the bond to maturity then you're fine.  Do you know what a bond is or want me to explain?

 

You may have been giving HT a lesson on bonds the last page or two, and I didn't intercede in that discussion as it was between you and him, but this post absolutely refers to SVB.   Quit the backtracking.  It makes you look foolish.

[Hardcore troubadour 16,062]

I am well aware of what a bond is. Gutterboy just lying again. He’s amazing. 

[GutterBoy 2,900]

4 minutes ago, Strike said:

Bullsh*t.  Here is your post, AGAIN:

You may have been giving HT a lesson on bonds the last page or two, and I didn't intercede in that discussion as it was between you and him, but this post absolutely refers to SVB.   Quit the backtracking.  It makes you look foolish.

Bro just take the L.  There is no backtracking.  Your highlighted part is true.  I know you are obsessed with me but you got ahead of your skis on this one 

[GutterBoy 2,900]

1 minute ago, Hardcore troubadour said:

I am well aware of what a bond is. Gutterboy just lying again. He’s amazing. 

Well I wanted to be sure since you still don't know what a bank run is.  Just trying to help.

[Strike 6,036]

Just now, GutterBoy said:

Bro just take the L.  There is no backtracking.  Your highlighted part is true.  I know you are obsessed with me but you got ahead of your skis on this one 

Nah.  The posts speak for themselves.