stock market was up today...

[lawgator1]

That’s what LG is not getting.

SVB’s fixed income holdings appeared fine. Until they were marked to market and sold…

They lost $1.8B selling bonds at actual market price - that sparked the conflagration.

And am I right its because they were buying things like 10 year treasury notes at low interest rates in the current environment?

 

[lawgator1]

It was the SV startups cash, invested in long term treasuries, that is now gone.

That's different than what was said. We were talking about buying treasuries but then someone says "and they invested badly in tech companies" whiich is a whole different kettle of fish.

 

[Orangeburst]

Yes.

The State of California stepped in and seized SVB so they could pay out Reparations.

You cracked the code.

A rhetorical comment.
What way did the state of CA step in?

 

[NorthDallas40]

And am I right its because they were buying things like 10 year treasury notes at low interest rates in the current environment?

What happens to the value of existing treasury bonds resold in the secondary market when the interest rate increases?

The bond valuation at maturity is not impacted from what I understand. But all of the trading in the markets on bonds already sold are impacted by the current yield price on the same instrument if sold new.

SVB was being forced to sell their bonds on the secondary market to cover liquidity issues and they were worth a whole lot less than what they paid for them.

 

[85SugarVol]

And am I right its because they were buying things like 10 year treasury notes at low interest rates in the current environment?

Yes. They were buying long term securities at record low interest rates.

When interest rates went up - The market value of those bonds went down.

SVB had to sell its positions for $0.80 on the $1.00

 

[85SugarVol]

That's different than what was said. We were talking about buying treasuries but then someone says "and they invested badly in tech companies" whiich is a whole different kettle of fish.

Yes

 

[Thunder Good-Oil]

It is going to be interesting to see how the FDIC manages this mess in the next few days. Those Silicon Valley startup companies that had their working capital as cash deposited at SVB have payrolls to meet and it’s currently frozen.

If it was West Virginia coal miners not getting paid instead of California based tech employees, Biden would probably not interrupt his nap time.

 

[85SugarVol]

What way did the state of CA step in?

Armed lol. They froze the banks assets and physically went in.

SVB was busy paying out $100k bonuses to its employees to the very end - until they were locked out.

 

[Go aeiou]

A rhetorical comment.
What way did the state of CA step in?

SVB is a state chartered bank. CA's job to shut it down.

 

[NorthDallas40]

Armed lol. They froze the banks assets and physically went in.

SVB was busy paying out $100k bonuses to its employees to the very end - until they were locked out.

I think we’re gonna see people being told to not get too attached to those bonuses.

 

[85SugarVol]

It is going to be interesting to see how the FDIC manages this mess in the next few days. Those Silicon Valley startup companies that had their working capital as cash deposited at SVB have payrolls to meet and it’s currently frozen.

If it was West Virginia coal miners not getting paid instead of California based tech employees, Biden would probably not interrupt his nap time.

It’s across the country.

There are toy stores in New York holding 40% off fire sales because their cash was at SVB.

 

[85SugarVol]

I think we’re gonna see people being told to not get too attached to those bonuses.

I don’t know how you get it back. SVB was still in control when they were issued.

 

[Orangeburst]

California Financial Regulator Takes Possession of Silicon Valley Bank | The Department of Financial Protection and Innovation

According to what the MSM has said..something doesn't add up

Silicon Valley Bank is a state-chartered commercial bank based in Santa Clara and is a member of the Federal Reserve System, with total assets of approximately $209 billion and total deposits of approximately $175.4 billion as of Dec. 31, 2022. Its deposits are federally insured by the FDIC subject to applicable limits.

 

[Orangeburst]

My thoughts

 

[Orangeburst]

Fear can be a contagion in its own to ones demise.
But hey the CC initiative of the world that has been proclaimed the end for decades, yet with the leadership for some Swede child.. .let's pour trillions.

 

[Orangeburst]

Just out of coincidence..Silicon Valley
Next step in a cashless society..which is hanging on by a thread. Basically just digits now

At least decades ago..you could pull it out and put it in your safe.
Now even 10K gets an IRS Report

 

[NorthDallas40]

Treasury, Federal Reserve, FDIC release joint statement mapping out approach to Silicon Valley Bank collapse

Depositors will have access to all of their money starting Monday, March 13. The taxpayer will bear no losses associated with the resolution of SVB.

Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

The Federal Reserve said it would make additional funding available to "eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors."

 

[Orangeburst]

Treasury, Federal Reserve, FDIC release joint statement mapping out approach to Silicon Valley Bank collapse

Depositors will have access to all of their money starting Monday, March 13. The taxpayer will bear no losses associated with the resolution of SVB.

Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.

The Federal Reserve said it would make additional funding available to "eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors."

What the hell does that mean?

Why is the FR involved in FDIC?

 

[NorthDallas40]

What the hell does that mean?

Why is the FR involved in FDIC?

Ask Jay Powell. I interpreted it as favorable short term loans to bridge the near term gap until this settles out. No idea if that’s. Correct though

 

[Orangeburst]

Ask Jay Powell. I interpreted it as favorable short term loans to bridge the near term gap until this settles out. No idea if that’s. Correct though

Sounds to me like the FR is about to back regardless of Yellen.

Seen this shitshow 15 years ago.

And yet miraculously..nobody ever goes to prison

 

[Orangeburst]

Why the need for the FR when the FDIC has the typical American depositor covered? Huh.

 

[MurphyVol]

The Federal Reserve has always provided funding to banks

 

[Orangeburst]

The Federal Reserve has always provided funding to banks

To failing banks?

 

[MurphyVol]

To failing banks?

It didn't say they were providing it to failing banks

 

[NorthDallas40]

Sounds to me like the FR is about to back regardless of Yellen.

Seen this shitshow 15 years ago.

And yet miraculously..nobody ever goes to prison

You know you seem that regardless of what is said you want to be pissed off about this regardless of what is posted.

I have to be honest right now I’m more concerned how bad ATT is going to screw up the fiber install on my house on Tuesday than I am about any potential fallout from SVB. The article also mentioned Signature bank in NY, NY was also shut down under apparently similar circumstances. I read that as more bad risk management. And I’m still more worried about ATT than I am either of these banks.