6 ms·

It aint fucking lost on me that financial papers spent the better part of 2022 arguing that we were headed for a recession. The q4 numbers came in showing the U

It aint fucking lost on me that financial papers spent the better part of 2022 arguing that we were headed for a recession. The q4 numbers came in showing the US economy was still expanding and now those same papers are telling me we're in a banking crisis on the basis of like two and a half banks, with SVB and CS both being fully rescued. The fucking owners of capital seem bound and determined to destroy their own system.

chiefalchemist 4y ago
> The fucking owners of capital seem bound and determined to destroy their own system. Nah. These disruptions are a means to an ends. That is, shifting still more wealth to the top. Follow that graph. Everything else is a means to that ends or a distraction.
- oblio 4y ago
  I hate all these conspiracy theories. And you know why? It's because they imply hubris, arrogance, control. Let's just realize that we all have a lot less control over our environment than we think we do, and some things are just forces beyond anyone's control.
  - Avshalom 4y ago
    I mean hubris and arrogance are in full and open display pretty constantly. The inability to actually control shit is why its always a moving target. but the idea that rich people are acting in a manner to maintain/increase their wealth aint exactly a conspiracy theory.
    - oblio 4y ago
      > but the idea that <<people>> are acting in a manner to maintain/increase their wealth aint exactly a conspiracy theory. This is the correct statement and it's not a conspiracy theory, it's a banality.
      - olddustytrail 4y ago
        It's certainly not correct. If it was far fewer people would be in debt. People generally prioritise short term happiness over wealth building.
        oblio 4y ago
        Your comment is not helping the conspiracy angle I was debunking up top so I assume we agree overall? There is no conspiracy, just random nature doing it thing and people trying to nudge it in their direction but frequently overshooting or undershooting.
        deleted 4y ago
        [deleted]
    - imtringued 4y ago
      If there are positive and zero sum games that can be played, then people who can win both of them will play them and ultimately win everything. The question becomes identifying zero sum games and finding optimal solutions for the public at large.
  - rqtwteye 4y ago
    Since 2008 I believe there are participants in the economy that are more equal than others. Namely Wall Street players.
    - oblio 4y ago
      I have bad news for you... that's how it's worked from the beginning of time. People with power have... more power. It's not a conspiracy, it's a side effect of the need to centralize for efficiency. Read something like Anarchy - the East India Company. Sheer luck got them to where they ended up, despite them being a) a literal "conspiracy" (a corporation) and b) bumbling fools on repeated occasions.
  - slj 4y ago
    What is a conspiracy here: The idea of an invisible hand which is beyond anyone’s control, or the analysis of historical information which shows a pattern? I choose to believe the data, not the fairytale you are proposing.
    - oblio 4y ago
      > What is a conspiracy here: The idea of an invisible hand which is beyond anyone’s control, or the analysis of historical information which shows a pattern? I choose to believe the data, not the fairytale you are proposing. What's the pattern?
      - chiefalchemist 4y ago
        More and more and more wealthy is moving to the top and becoming concentrated in fewer and fewer hands. That's the pattern.
  - strken 4y ago
    I hate the implication of coordination. I think it's more likely that every person at every link in the chain is following some incentive: financial experts within banks are saying whatever they think will get governments to stop putting up interest rates (we're in a banking crisis), journalists are repeating interesting and dramatic news from their sources (that we're in a banking crisis), their editors are careful not to block an important message (that we're in a banking crisis), and so on. The net effect is possibly going to be moving wealth to the top, but if you take a conspiratorial view, the solution seems like it's "find the shadowy council working behind the scenes and force them to stop". If it's just distributed rational decision-making you have to take a systems-level view of what the incentives are and work to change the overall behaviour of everyone, which is a much more complicated problem.
    - nicoburns 4y ago
      I mean the right-wing political parties are pretty open about their desire to keep the status quo economic system which causes wealth the move to the top (and in many cases increase the extent to which it does by doing things like privatising public industries, deregulating industries, etc). And they're obviously a coordinated entity by nature of being a political party. No conspiracy theories required.
      - chiefalchemist 4y ago
        To be fair, the left isn't much better. Sure their rhetoric might sound a bit different but they're still part of the boarder system. A system that as consistently failed the people they've been elected to represent. It's a distraction to point fingers at left or right.
    - Avshalom 4y ago
      The rhetorical problem is that it's a sort of inverse of Yossarian's "they're trying to kill me", coordination is often not usefully distinct from a system which incentivizes the same actions that would be achieved through coordination. Some things are very hard to describe without sounding like a conspiracy no matter how little communication happens between actors, precisely because those incentives are a form of communication.
  - mym1990 4y ago
    This might be true for most people, but those with billions have the means to control policy, technological advancement, incentives, and how that technology gets used. Small picture, sure, random walk, but zoom out and there is definitely a path most people are following without knowing.
  - ashwagary 4y ago
    >I hate all these conspiracy theories. >Let's just realize that we all have a lot less control over our environment than we think we do Do the privately run secretive organization that sets the time value of money and the people that influence it not have "control"? To be clear, I'm talking about the central bank.
    - imtringued 4y ago
      The central bank has very little power over the economy actually. It basically only has one lever and it is akin to a wrecking ball. It's job is to clean up the mess, not control the economy. Fed is 98% talk and 2% action.
      - ashwagary 4y ago
        >The central bank has very little power over the economy actually. I disagree. Any organization that can unilaterally set interest rates and add infinite assets to its balance sheet (two actions capable of moving the largest markets significantly) has tremendous amounts of control over the economy. The vast majority of people are just unaware how much of an impact monetary policy has on their behavior.
  - heavyset_go 4y ago
    The business cycle isn't a conspiracy theory.
    - oblio 4y ago
      > The business cycle isn't a conspiracy theory. The business cycle is a well-documented fact of the economy, caused by basic microeconomics. The busts have as good a reason to be there as do the booms. Plus the business cycle has booms which are on average much longer than the busts, an angle which conspiracy theorists frequently choose to ignore. The business cycle is not a conspiracy theory, thinking the business cycle is somehow "made" or "artificial" or "controlled" is a conspiracy theory.
  - chiefalchemist 4y ago
    Conspiracy theories? Check the data... What happened after 2007/ 2008? What happened during / after Covid? There is zero reason to imply any of those things. The data speaks for itself.
    - oblio 4y ago
      I'm a history buff and I read avidly. 2008 and Covid don't really impress me after reading about the East India Companies (British, Dutch), colonialism in general, power structures in places like Rome, etc. The data points to wealth redistribution but the causes are larger than some dark cabals. Globalization is the biggest one and globalization is such a huge topic not even 1000 CEO out together could begin to understand it.
- Avshalom 4y ago
  Specifically the recession talk seemed to be an attempt to destroy what little gains labor had made in the past couple years. A banking crisis is not exactly the same but would lead to the same public justifications. As a personal anecdote: In the wake of 2008 massive layoffs flooded the market driving down costs for... not necessarily skilled but educated labor. Target for instance suddenly decided that being an ETL required a college degree, a requirement that they relaxed in 2021. I'm aware creating a public justification for creating a mass of unemployed skilled (read: otherwise expensive) laborers is in their benefit. It's just that the public face of this is destroying their own systems then claiming literally any and everything other than their own actions are at fault while simultaneously positioning themselves to benefit from any attempt at preventing economic disaster.
  - chiefalchemist 4y ago
    > Specifically the recession talk seemed to be an attempt to destroy what little gains labor had made in the past couple years "Remember the great resignation? Good! You shouldn't! Now damn you proles, don't you forget that you can't remember it." As for your last paragraph, it's about control. Regardless of what's being "destroyed", they are creating more wealth and power, and the majority of that goes to the top. Again, this isn't opinion. It's the data. The Public's fault is believing what they hear instead of watching what is happening. Actions speak louder than words. Or they should.
SkyMarshal 4y ago
They may also be spinning things to scare policy makers into steering things in a different direction.
bogomipz 4y ago
>"The q4 numbers came in showing the US economy was still expanding and now those same papers are telling me we're in a banking crisis on the basis of like two and a half banks, with SVB and CS both being fully rescued." Why would GDP(a lagging indicator) and a current event(a wave of banks over the last two week) be mutually exclusive? You also seem to have overlooked some significant details and context. To date there have been four bank rescues not two - Signature Bank, First Republic, SVB and Credit Suisse. The Credit Suisse collapse resulted in 17 billion in AT1 bonds being written down.[1]. SVB’s uninsured deposits(anything over 250k) accounted for 94% of its total deposits and the FDIC took the extraordinary step of insuring those deposit after the fact. We witnessed the US Treasury Secretary this week suggest that the government would backstop all uninsured deposits at smaller banks.[2]. She then later had to walk that back. The First Republic rescue saw three of the largest US banks depositing 30 billion dollars into it in order to prop it up. [1] https://www.reuters.com/business/finance/credit-suisse-writes-down-17-bln-bonds-zero-angering-holders-2023-03-19/ https://www.reuters.com/business/finance/credit-suisse-write... [2] https://www.reuters.com/markets/us/treasurys-yellen-says-committed-protecting-bank-deposits-more-actions-may-be-2023-03-21/ https://www.reuters.com/markets/us/treasurys-yellen-says-com...
- arcticbull 4y ago
  > SVB’s uninsured deposits(anything over 250k) accounted for 94% of its total deposits and the FDIC took the extraordinary step of insuring those deposit after the fact. Did they need to? It's not clear anyone would have lost anything at all because depositors are senior to equity and bond holders. All the bank's equity would have been wiped out sure (and it was anyways) but losses to depositors would likely be slim to none. If folks lost anything it would worst case have been like a 5-10% haircut, not 100% of un-insured deposits. The FDIC was using this as an opportunity to say "we've got your back no matter what" to reassure the public. It's extremely unlikely anyone, anywhere, would be at risk of losing any deposits - insured or uninsured - in this day and age in the US regardless of the FDIC's 'new' position. > The first republic rescue saw three of the largest US banks depositing 30 billion dollars to prop it up. The only real issue at banks right now is that they're in long-term government debt which has significant mark to market losses - which are an issue if folks are trying to withdraw since they can't be liquidated for face value. However if they're held to maturity there's no loss. So the Fed provided a facility where banks can borrow against the maturity value of long-term debt instead of market value. That makes the problem basically solved.
ModernMech 4y ago
> The fucking owners of capital seem bound and determined to destroy their own system. Well yeah, everything worked out fine for them last time they did. Some got very rich. Why not try again?
- euroderf 4y ago
  As long as losses are socialized it's all good eh!
efficax 4y ago
it’s called a capital strike. the goal is to bring down the cost of labor.

chiefalchemist 4y ago

> The fucking owners of capital seem bound and determined to destroy their own system. Nah. These disruptions are a means to an ends. That is, shifting still more wealth to the top. Follow that graph. Everything else is a means to that ends or a distraction.

oblio 4y ago
I hate all these conspiracy theories. And you know why? It's because they imply hubris, arrogance, control. Let's just realize that we all have a lot less control over our environment than we think we do, and some things are just forces beyond anyone's control.
- Avshalom 4y ago
  I mean hubris and arrogance are in full and open display pretty constantly. The inability to actually control shit is why its always a moving target. but the idea that rich people are acting in a manner to maintain/increase their wealth aint exactly a conspiracy theory.
  - oblio 4y ago
    > but the idea that <<people>> are acting in a manner to maintain/increase their wealth aint exactly a conspiracy theory. This is the correct statement and it's not a conspiracy theory, it's a banality.
    - olddustytrail 4y ago
      It's certainly not correct. If it was far fewer people would be in debt. People generally prioritise short term happiness over wealth building.
      - oblio 4y ago
        Your comment is not helping the conspiracy angle I was debunking up top so I assume we agree overall? There is no conspiracy, just random nature doing it thing and people trying to nudge it in their direction but frequently overshooting or undershooting.
        deleted 4y ago
        [deleted]
  - imtringued 4y ago
    If there are positive and zero sum games that can be played, then people who can win both of them will play them and ultimately win everything. The question becomes identifying zero sum games and finding optimal solutions for the public at large.
- rqtwteye 4y ago
  Since 2008 I believe there are participants in the economy that are more equal than others. Namely Wall Street players.
  - oblio 4y ago
    I have bad news for you... that's how it's worked from the beginning of time. People with power have... more power. It's not a conspiracy, it's a side effect of the need to centralize for efficiency. Read something like Anarchy - the East India Company. Sheer luck got them to where they ended up, despite them being a) a literal "conspiracy" (a corporation) and b) bumbling fools on repeated occasions.
- slj 4y ago
  What is a conspiracy here: The idea of an invisible hand which is beyond anyone’s control, or the analysis of historical information which shows a pattern? I choose to believe the data, not the fairytale you are proposing.
  - oblio 4y ago
    > What is a conspiracy here: The idea of an invisible hand which is beyond anyone’s control, or the analysis of historical information which shows a pattern? I choose to believe the data, not the fairytale you are proposing. What's the pattern?
    - chiefalchemist 4y ago
      More and more and more wealthy is moving to the top and becoming concentrated in fewer and fewer hands. That's the pattern.
- strken 4y ago
  I hate the implication of coordination. I think it's more likely that every person at every link in the chain is following some incentive: financial experts within banks are saying whatever they think will get governments to stop putting up interest rates (we're in a banking crisis), journalists are repeating interesting and dramatic news from their sources (that we're in a banking crisis), their editors are careful not to block an important message (that we're in a banking crisis), and so on. The net effect is possibly going to be moving wealth to the top, but if you take a conspiratorial view, the solution seems like it's "find the shadowy council working behind the scenes and force them to stop". If it's just distributed rational decision-making you have to take a systems-level view of what the incentives are and work to change the overall behaviour of everyone, which is a much more complicated problem.
  - nicoburns 4y ago
    I mean the right-wing political parties are pretty open about their desire to keep the status quo economic system which causes wealth the move to the top (and in many cases increase the extent to which it does by doing things like privatising public industries, deregulating industries, etc). And they're obviously a coordinated entity by nature of being a political party. No conspiracy theories required.
    - chiefalchemist 4y ago
      To be fair, the left isn't much better. Sure their rhetoric might sound a bit different but they're still part of the boarder system. A system that as consistently failed the people they've been elected to represent. It's a distraction to point fingers at left or right.
  - Avshalom 4y ago
    The rhetorical problem is that it's a sort of inverse of Yossarian's "they're trying to kill me", coordination is often not usefully distinct from a system which incentivizes the same actions that would be achieved through coordination. Some things are very hard to describe without sounding like a conspiracy no matter how little communication happens between actors, precisely because those incentives are a form of communication.
- mym1990 4y ago
  This might be true for most people, but those with billions have the means to control policy, technological advancement, incentives, and how that technology gets used. Small picture, sure, random walk, but zoom out and there is definitely a path most people are following without knowing.
- ashwagary 4y ago
  >I hate all these conspiracy theories. >Let's just realize that we all have a lot less control over our environment than we think we do Do the privately run secretive organization that sets the time value of money and the people that influence it not have "control"? To be clear, I'm talking about the central bank.
  - imtringued 4y ago
    The central bank has very little power over the economy actually. It basically only has one lever and it is akin to a wrecking ball. It's job is to clean up the mess, not control the economy. Fed is 98% talk and 2% action.
    - ashwagary 4y ago
      >The central bank has very little power over the economy actually. I disagree. Any organization that can unilaterally set interest rates and add infinite assets to its balance sheet (two actions capable of moving the largest markets significantly) has tremendous amounts of control over the economy. The vast majority of people are just unaware how much of an impact monetary policy has on their behavior.
- heavyset_go 4y ago
  The business cycle isn't a conspiracy theory.
  - oblio 4y ago
    > The business cycle isn't a conspiracy theory. The business cycle is a well-documented fact of the economy, caused by basic microeconomics. The busts have as good a reason to be there as do the booms. Plus the business cycle has booms which are on average much longer than the busts, an angle which conspiracy theorists frequently choose to ignore. The business cycle is not a conspiracy theory, thinking the business cycle is somehow "made" or "artificial" or "controlled" is a conspiracy theory.
- chiefalchemist 4y ago
  Conspiracy theories? Check the data... What happened after 2007/ 2008? What happened during / after Covid? There is zero reason to imply any of those things. The data speaks for itself.
  - oblio 4y ago
    I'm a history buff and I read avidly. 2008 and Covid don't really impress me after reading about the East India Companies (British, Dutch), colonialism in general, power structures in places like Rome, etc. The data points to wealth redistribution but the causes are larger than some dark cabals. Globalization is the biggest one and globalization is such a huge topic not even 1000 CEO out together could begin to understand it.
Avshalom 4y ago
Specifically the recession talk seemed to be an attempt to destroy what little gains labor had made in the past couple years. A banking crisis is not exactly the same but would lead to the same public justifications. As a personal anecdote: In the wake of 2008 massive layoffs flooded the market driving down costs for... not necessarily skilled but educated labor. Target for instance suddenly decided that being an ETL required a college degree, a requirement that they relaxed in 2021. I'm aware creating a public justification for creating a mass of unemployed skilled (read: otherwise expensive) laborers is in their benefit. It's just that the public face of this is destroying their own systems then claiming literally any and everything other than their own actions are at fault while simultaneously positioning themselves to benefit from any attempt at preventing economic disaster.
- chiefalchemist 4y ago
  > Specifically the recession talk seemed to be an attempt to destroy what little gains labor had made in the past couple years "Remember the great resignation? Good! You shouldn't! Now damn you proles, don't you forget that you can't remember it." As for your last paragraph, it's about control. Regardless of what's being "destroyed", they are creating more wealth and power, and the majority of that goes to the top. Again, this isn't opinion. It's the data. The Public's fault is believing what they hear instead of watching what is happening. Actions speak louder than words. Or they should.

SkyMarshal 4y ago

They may also be spinning things to scare policy makers into steering things in a different direction.

bogomipz 4y ago

>"The q4 numbers came in showing the US economy was still expanding and now those same papers are telling me we're in a banking crisis on the basis of like two and a half banks, with SVB and CS both being fully rescued." Why would GDP(a lagging indicator) and a current event(a wave of banks over the last two week) be mutually exclusive? You also seem to have overlooked some significant details and context. To date there have been four bank rescues not two - Signature Bank, First Republic, SVB and Credit Suisse. The Credit Suisse collapse resulted in 17 billion in AT1 bonds being written down.[1]. SVB’s uninsured deposits(anything over 250k) accounted for 94% of its total deposits and the FDIC took the extraordinary step of insuring those deposit after the fact. We witnessed the US Treasury Secretary this week suggest that the government would backstop all uninsured deposits at smaller banks.[2]. She then later had to walk that back. The First Republic rescue saw three of the largest US banks depositing 30 billion dollars into it in order to prop it up. [1] https://www.reuters.com/business/finance/credit-suisse-writes-down-17-bln-bonds-zero-angering-holders-2023-03-19/ https://www.reuters.com/business/finance/credit-suisse-write... [2] https://www.reuters.com/markets/us/treasurys-yellen-says-committed-protecting-bank-deposits-more-actions-may-be-2023-03-21/ https://www.reuters.com/markets/us/treasurys-yellen-says-com...

arcticbull 4y ago
> SVB’s uninsured deposits(anything over 250k) accounted for 94% of its total deposits and the FDIC took the extraordinary step of insuring those deposit after the fact. Did they need to? It's not clear anyone would have lost anything at all because depositors are senior to equity and bond holders. All the bank's equity would have been wiped out sure (and it was anyways) but losses to depositors would likely be slim to none. If folks lost anything it would worst case have been like a 5-10% haircut, not 100% of un-insured deposits. The FDIC was using this as an opportunity to say "we've got your back no matter what" to reassure the public. It's extremely unlikely anyone, anywhere, would be at risk of losing any deposits - insured or uninsured - in this day and age in the US regardless of the FDIC's 'new' position. > The first republic rescue saw three of the largest US banks depositing 30 billion dollars to prop it up. The only real issue at banks right now is that they're in long-term government debt which has significant mark to market losses - which are an issue if folks are trying to withdraw since they can't be liquidated for face value. However if they're held to maturity there's no loss. So the Fed provided a facility where banks can borrow against the maturity value of long-term debt instead of market value. That makes the problem basically solved.

ModernMech 4y ago

> The fucking owners of capital seem bound and determined to destroy their own system. Well yeah, everything worked out fine for them last time they did. Some got very rich. Why not try again?

euroderf 4y ago
As long as losses are socialized it's all good eh!

efficax 4y ago

it’s called a capital strike. the goal is to bring down the cost of labor.