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This is how financial crises start. IndyMac ($40 billion) went under in July 2008 which caused tension, and then Lehman fell apart two months later which led to
by FormerBandmate 4y ago
This is how financial crises start. IndyMac ($40 billion) went under in July 2008 which caused tension, and then Lehman fell apart two months later which led to 15 institutions failing in a matter of weeks.
There are other financial institutions that are suffering. We could definitely see cascades among some of the weaker banks
- koolba 4y agoBear Stearns was even earlier that same year. It’s like that old quote about going bankrupt, first it happened slowly, then suddenly.
- toomuchtodo 4y agohttps://www.youtube.com/watch?v=gUkbdjetlY8 https://www.youtube.com/watch?v=gUkbdjetlY8
- koolba 4y agoIf you’re gonna shop Cramer clips, might as well show his take on SVB from about a month ago: https://twitter.com/WatcherGuru/status/1634246217226919937 https://twitter.com/WatcherGuru/status/1634246217226919937 (Spoiler: should have bought the inverse Cramer ETF…)
- mftb 4y ago"How did you go bankrupt?" Bill asked. "Two ways," Mike said. "Gradually and then suddenly." --Ernest Hemingway, The Sun Also Rises
- pcdoodle 4y agoIf you were ultra paranoid, what other institution types would be advisable to exit? Could this impact investments in the market?
- saurik 4y agoHow paranoid would you have to get before you'd be willing to convert all your money to crypto? ;P
- recursive 4y agoMy paranoia goes the other way.
- pcdoodle 4y agoif by crypto you mean bitcoin, i'd feel more comfortable xD
- rcme 4y agoCrypto was the first to fall
- pcdoodle 4y agoAt least they still have their keys (hopefully).
- echelon 4y agoIf crypto had a navy and nukes, then maybe.
- sapling-ginger 4y agoSwitzerland has neither and China has both. Which one would you bank with?
- inconceivable 4y agoi think this question depends entirely on what passport you hold. as a US citizen, personally i wouldn't put money in either system.
- EVa5I7bHFq9mnYK 4y ago
- 1270018080 4y agoThose banks were all built on a fraudulent and irrational housing bubble. SVB just bought too many bad bonds and got stuck. I don't see the industry-wide effects from this.
- cplusplusfellow 4y agoThe bonds aren’t bad. They are performing according to all reports I’m reading. They simply have a longer date to maturity then is comfortable for the depositors withdrawal cadences, and they have had to be sold / marked down in a period of rising interest rates.
- 1270018080 4y agoI mean bad by low returns and long date to maturity, as in a poor choice.
- wefarrell 4y agoThey bought those bonds based on the assumption that money would flow in/out within a certain margin and that margin was exceeded. There will definitely be more cases to come where companies who are supposed to act conservatively took on more risk because they’re used to operating in an environment where it was profitable to do so.
- postingawayonhn 4y agoThe next financial crisis likely won't play out the same as the last.
- BearOso 4y agoWe're in a semi-fraudulent housing bubble now. Well, maybe not fraudulent, but unethical, and similar to what was going on in the '00s. Big banks are holding onto large, mostly unoccupied housing developments to create artificial scarcity and drive the prices up. Then they're selling with huge loans to buyers that are going to see value plummet and be unable to pay anything back.
- 4y ago
- panda888888 4y agoIs there a way to tell which banks are the weaker banks? I know the fed does stress tests but I've read that Silicon Valley Bank didn't take part, so I don't know how to get the data.