Bank Runs! What's Going On? - Patrick Boyle
- Thread starter The_Krakenite
- Start date
Interesting, some will say that's what Bernanke said in 2007
In the U.S., real bank runs, where individual are fearful of losing all or some of their demand deposits and actually could, are a thing of the past. Individuals can be irrational. They can even think that somehow Joe Biden stole millions of votes from Donald Trump. But believing in nonsense does not make it true.
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If you're telling me the average American voted for Biden, then you are 100% correct about the irrational part.
Well, I've never been a big fan of Bernanke or his successors either. However, I don't think there will be any spillover effect from the demise of Silicon Bank like what we saw in 2008 after Lehman collapse, which sent a shockwave all over the globe. Sure, some depositors and investors will lose their shirt from this debacle, unfortunately. But for the most part, it will be seen as just another mismanaged company that followed in the footstep of those that already went belly up. Speaking of which, do the market even care about FTX anymore?Interesting, some will say that's what Bernanke said in 2007
BTW FDIC obviously didn't think Silicon Bank was "too big to fail" and I'm not sure how I would feel about that if I were their customer.
So... the lesson here is don't buy bonds with coupon payouts of under 1% If the interest rates don't go negative, then you're screwed.
Got it!
Got it!
They should have been buying 30-90 day T-Bills not 3-10 Yr Notes, especially not after March 2022 when the Fed started to raise rates. Alternatively they could bought 3-10 Notes but hedged against principal decay (aka deep OTM put options).
I think there is still a danger that Silicon Valley Bank == Bear Sterns. And more dominoes are ready to fall caused by runs on deposits.
Didn't you hear Yellen saying she is monitoring a few other banks.
Translated that means: Shit about to get real