Ah ok cool. I thought one would have/want to do something different beyond sticking as much money as govt protection schemes allow per institution. Thanks
Who Killed Silicon Valley Bank?
- Thread starter ETJ
- Start date
My post you quoted did not answer any questions. If you re-read it thoroughly, I was asking the forum to answer those specifics.
From what I know, the bank's management made a risky investment by putting a large portion of the bank's assets into mortgage-backed securities that were considered "risk-free" at the time. This investment strategy, combined with a high concentration of mortgage-backed securities relative to other banks, left the bank exposed to a particular risk known as extension risk.
You equally blame the managerial assistants that lost their jobs because they should have done more due diligence where they worked at? Your point is nonsense. Depositors don't bear any fault in this. Investors and management do with their ludicrous demands for unrealistic returns a deposit taking bank should generate.
One of the great trades over the coming weeks is gonna be long exposure to US yields all the way out to 2yrs.the market completely got this wrong. The Fed won't let off its focus on inflation and the market completely overreacted to SVBs default. Contagion risk at this point is way overpriced.
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JPMorgan analysts warned about Silicon Valley Bank’s $16B in ‘unrealized losses’ in November
https://nypost.com/2023/03/12/jpmor...y-banks-16b-in-unrealized-losses-in-november/
I don't think it was even that risky of a bet from what I was reading. It was safe bet in MBS made risky by rates going from zero to 4.5% so fast. If they held to maturity they would get their principal back but a run on business banking meant they had to sell before they wanted and realize the losses causing a chain reaction.
The person I was listening to yesterday thought the Fed/Treasury has already blundered this. He was saying the businesses he knows are basically going to be running to larger banks that are "too big to fail" and this needed to have been put to bed on Friday.
Fed Funds moved to a 53% chance of a pause now.
The person I was listening to yesterday thought the Fed/Treasury has already blundered this. He was saying the businesses he knows are basically going to be running to larger banks that are "too big to fail" and this needed to have been put to bed on Friday.
Fed Funds moved to a 53% chance of a pause now.