Advertisement

Author Topic: Best Explanation for SVB Collapse  (Read 1399 times)

0 Members and 1 Guest are viewing this topic.

Offline hmgROCK

  • Elite Poster
  • *****
  • Posts: 35765
  • The Hmong Nostradamus
  • Respect: +216
    • View Profile
Re: Best Explanation for SVB Collapse
« Reply #30 on: March 26, 2023, 06:43:28 AM »
I guess you missed the part in the article that read:

As the tech industry grew in 2020 and 2021, fueled by low interest rates, SVB benefited like few others. Its stock soared. Flooded with new deposits, Chief Executive Greg Becker and his team kept much of the money in longer-term government-backed mortgage bonds and Treasury debt, usually safe investments.

Yes, usually safe investments as long as interest rates are low. Geeze, I wonder why those interest rates started skyrocketing? I wonder why just a month ago eggs were going for as high as $8 a dozen?

Sure, there was the Avian Flu but Joe Biden's incompetency didn't help. He caused the inflation, which triggered the Fed Reserve to hike up interest rates.

Think of it like this. There will always be bills to pay, fires to put out, and unforeseen circumstances in life. But life is harder when you have a crack addict head of household. Joe Biden is the crack addict head of household.  :2funny: 

SVB Bank failed because many of their big customers were these tech companies that not only had large deposits but were also taking out loans. SVB was investing in bonds to keep cash flowing until high interest rates depleted that cash, AND now tech companies could not withdraw anything over $250k. And since the FDIC doesn't insure anything more than that, those companies lost money. Unless of course, Biden bails out SVB.

You can't be foolish enough to believe that all the other banks aren't making the same kind of investments.  ::) BECAUSE THEY DO. The only diff is that they probably don't have as many volatile start-up companies who deposit huge sums of money and then come calling to withdraw.

Stop adding your make up ANTI LEFT NARRATIVE to the article
It never says anything about liberals companies failing


You are such a dumb ass

 ;D ;D ;D


PLEASE READ THE ARTICLE FIRST
THAT YOU LINK

Sheesh



Like this post: 0
God did not created man...man created god

Adverstisement

Offline hmgROCK

  • Elite Poster
  • *****
  • Posts: 35765
  • The Hmong Nostradamus
  • Respect: +216
    • View Profile
Re: Best Explanation for SVB Collapse
« Reply #31 on: March 26, 2023, 06:48:42 AM »
Duh, of course bonds earn less than stocks. That's why they're also not as risky. They're suppose to be more steady FOR AS LONG AS INTEREST RATES ARE LOW. The article is still relevant because it shows why banks invested in bonds, WHICH IS WHAT EVENTUALLY ENDED SVB. They did not have cash to cover their tech customers who were trying to withdraw deposits that were more than $250k.

Don't feel bad for yourself. I don't expect all accountants (be it current or former) to actually know their profession. Look at that Kay Yang investor who is being sued.  :2funny:

Now you might have been an accountant, but my niece and cousin are both bank controllers. I'm pretty sure both know how the banking industry works and this was just a layman's explanation for folks like YAX. Don't want to complicate the information for him.   O0


What happen to the gay liberals companies going bankrupt???

Lol

Is it the liberals companies or SVB making bad bet???



You know I invest and stuff right
Even my low education IQ don’t go all in
Even with these decent interest rate
Because I believe the FED is going raise interest rate
Know your RISK
My risk is short term
And i do a CD LADDER
SVB NEED TO HIRE ME… i will manage and hedge their RISK  ;D ;D

PIC OR IT DIDN'T HAPPEN




« Last Edit: March 26, 2023, 06:55:40 AM by hmgROCK »

Like this post: 0
God did not created man...man created god

 

Advertisements