Buckle up, the crash is sooner rather than later

[soflagator]

ROKU has 487 LARGE (million) at SIVB.

View attachment 55538

Roku says 26% of its cash reserves are stuck in Silicon Valley Bank

Around $487 million of Roku's cash reserves are stuck at Silicon Valley Bank, the streaming media company said Friday.

www.cnbc.com

Good. Their remotes suck.

 

[gatorev12]

ROKU has 487 LARGE (million) at SIVB.

View attachment 55538

Roku says 26% of its cash reserves are stuck in Silicon Valley Bank

Around $487 million of Roku's cash reserves are stuck at Silicon Valley Bank, the streaming media company said Friday.

www.cnbc.com

This is what concerns me.

Not the market contagion since this is primarily an investment bank and few other banks have the same risk appetite as this one did.

But a TON of Silicon Valley firms banked here and those cash reserves are on iffy ground right now. That affects a lot of companies and we don't yet know how deep this goes. My suspicion isn't great.

 

[Concrete Helmet]

If this is a one-off, probably not too worrisome. But "moral hazard" may start trending again.

Ummmmm.....wrong.

 

[Concrete Helmet]

Now there's 2.....and more to come.

Does anyone remember the video I posted that showed there is over A QUADRILLION dollars.....yes thats a word......in these things called D-E-R-I-V-A-T-E-S..... in the worldwide banking system.

The damage is just starting to unfold because the house of cards(derivatives) is just starting to collapse....remember what I said in the Ukraine thread about bank runs? They're being covered up....

 

[Concrete Helmet]

https://www.thestreet.com/technology/two-us-banks-collapse-in-48-hours-which-one-is-next

 

[FireFoley]

This is what concerns me.

Not the market contagion since this is primarily an investment bank and few other banks have the same risk appetite as this one did.

But a TON of Silicon Valley firms banked here and those cash reserves are on iffy ground right now. That affects a lot of companies and we don't yet know how deep this goes. My suspicion isn't great.

I understand your point, but I think firms, like people must be responsible for their own decisions. SVB is really NOT an investment bank. Goldman and Morgan are investment banks. This bank held tech company's money in deposits. They never gave a thought to rates rising or VC, PE, angel investing drying up. Thus they were buying bonds, etc. while paying zero interest to customers b/c rates were zero. But when rates rose, VC,PE, and private money dried up for these Tech firms to tap. Thus they had to turn to their own funds on deposit at SVB. This is as simple as an old fahioned bank run. SVB would have had no issue had money still been plentiful and they could have held their bonds to maturity. But with rate increases, much of the investments that SVB held were of coupons less than current market rates. So when forced to sell those bonds, those were sold at a loss and you can only sell so many bonds for 90 cents on the dollar before you go under.

 

[Concrete Helmet]

I understand your point, but I think firms, like people must be responsible for their own decisions. SVB is really NOT an investment bank. Goldman and Morgan are investment banks. This bank held tech company's money in deposits. They never gave a thought to rates rising or VC, PE, angel investing drying up. Thus they were buying bonds, etc. while paying zero interest to customers b/c rates were zero. But when rates rose, VC,PE, and private money dried up for these Tech firms to tap. Thus they had to turn to their own funds on deposit at SVB. This is as simple as an old fahioned bank run. SVB would have had no issue had money still been plentiful and they could have held their bonds to maturity. But with rate increases, much of the investments that SVB held were of coupons less than current market rates. So when forced to sell those bonds, those were sold at a loss and you can only sell so many bonds for 90 cents on the dollar before you go under.

Yup a good old fashion bank run....ahhh, the wonders of a fractional reserve banking system in a rising interest rate environment....

 

[GatorCatsi]

Ummmmm.....wrong.

Wrong where?

 

[Concrete Helmet]

Wrong where?

2nd bank also collapsed

 

[GatorCatsi]

2nd bank also collapsed

Like I said, "If this is a one-off."
So, not wrong. Thanks for playing.

 

[Concrete Helmet]

Like I said, "If this is a one-off."
So, not wrong. Thanks for playing.

Does one snowflake cause an avalanche? Eventually yes.....

 

[GatorCatsi]

SVB Chief Sold $3.6 Million in Stock Days Before Bank’s Failure

Silicon Valley Bank Chief Executive Officer Greg Becker sold $3.6 million of company stock under a trading plan less than two weeks before the firm disclosed extensive losses that led to its failure.

www.bloomberg.com

 

[GatorCatsi]

 

[URGatorBait]

https://www.thestreet.com/technology/two-us-banks-collapse-in-48-hours-which-one-is-next

California banks

 

[FireFoley]

Not sure what this means as admittedly I have no interest in crypto whatever probably to my own detriment, but I am a Cash guy. Anyway it appears that this was a bit more than a bank run, more like a stampede.

Stablecoin USDC breaks dollar peg after firm reveals it has $3.3 billion in SVB exposure

The U.S. cryptocurrency firm Circle's USD Coin lost its dollar peg and fell to a record low Saturday morning.

www.cnbc.com

 

[Concrete Helmet]

Jerome be breaking stuff already....better lock in those short term treasuries while they're at their peak cause about 3 months from now Jerome will be back in this mode

 

[FireFoley]

I have to think that with all the noise, that the FED will make JPM or BAC a sweetheart deal kind of like JPM got with Bear Stearns, where the sale price was $10/share but JPM was only on the hook for $2 and the FED guaranteed the other $8.

Or maybe it will be like when the FED gave WAMU to JPM and BAC was given Countrywide. Did not cost those banks anything other than sorting thru all the garbage but they did not have to pay anything to take on those shyt shows. I do remember it took years for BAC to sort thru Countrywide's mess. I do not think that the SIVB situation is that complex relative to the GFC.

 

[Concrete Helmet]

I think the equation looks like this for most banks
Bonds they own down 25% overall
+
Crypto holdings down 70%(yes most banks bought BILLIONS in crypto)
+
Savings from customers at all time low meaning less cash on hand
+
Those with cash are all moving it to short term treasuries meaning less cash on hand
+
Now forced to sell their stock off to raise capital meaning the entire stock market will get crushed along with their share price
+
Forces hedgefunds and institutional investors to get massive margin calls on leveraged holdings
= A massive sh!tshow with ALL asset classes getting smashed 40-60%.......stocks, bonds, gold, crypto, commodities will all get pummeled....the big question will be which one rises the fastest and furthest. Believe it or not I can see a scenario where RE ends up being the most stable asset with the least amount of damage over the next 12-18 months.

 

[FireFoley]

Don't things happen in 3's? Silvergate, SIVB, and tonight Signature Bank has been seized.

 

[Concrete Helmet]

Don't things happen in 3's? Silvergate, SIVB, and tonight Signature Bank has been seized.

Yup.....emergency FED meeting called too.....heeerrree we go....