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higher interest rates will do plenty to press consequences on tech bros. bank runs are entirely unnecessary
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Mar 13, 2023 12:00
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Brrrmph posted:it’s a bailout and it’s hilarious to see the logistical hoops people jump through to say otherwise It’s absolutely a bailout, but who cares? It’s not bailing out the bank (it no longer exists), it’s bailing out their (now former) customers. The government has selectively assisted bank customers instead of shareholders. People that have no say in which bank their employer chooses can continue to be paid. Have we forgotten who to hate around here? The most sympathetic group involved was assisted and the least sympathetic wasn’t.
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Mar 13, 2023 12:18
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Wayne Knight posted:It’s absolutely a bailout, but who cares? It’s not bailing out the bank (it no longer exists), it’s bailing out their (now former) customers. The government has selectively assisted bank customers instead of shareholders. People that have no say in which bank their employer chooses can continue to be paid. Have we forgotten who to hate around here? The most sympathetic group involved was assisted and the least sympathetic wasn’t. the 'sympathetic group' here is the companies a bunch of politically connected billionaire VCs have invested into, not grandma and grandpa's retirement savings accounts
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Mar 13, 2023 12:22
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Regular-rear end people work there though. People work bullshit jobs all the time, and they should get paid. SV is a transfer of wealth from billionaire vampires to people with relatively little education compared to most highly paid occupations. Feel free to hate the companies but I can’t get behind “sacrifice the workers”.
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Mar 13, 2023 12:28
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mila kunis posted:the 'sympathetic group' here is the companies a bunch of politically connected billionaire VCs have invested into, not grandma and grandpa's retirement savings accounts It was a bunch of businesses. Sure you can pretend these accounts were all the personal slush funds of moustache twirling villains but the primary outcome of not helping here would have been tens of thousands of normal people losing their jobs and a bunch of other banks with similar issues immediately exploding. Somewhere, a rich guy is benefiting, but you can't tailor policy to snipe their wealth alone with things like this. That's want taxation is for, and good luck with that.
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Mar 13, 2023 12:31
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it might have been funnier had the government done nothing, but it'd take a pretty substantial level of spite to not spend $0 to stop some chaos and mess no doubt eventually impacting normal people too. and makes for a weird precedent, it is better if banks are more regulated and state-managed entities, and going "whelp, its all libertarian free market for this one because i don't like the people" is not necessarily wise.
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Mar 13, 2023 12:35
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Wayne Knight posted:Regular-rear end people work there though. People work bullshit jobs all the time, and they should get paid. SV is a transfer of wealth from billionaire vampires to people with relatively little education compared to most highly paid occupations. Feel free to hate the companies but I can’t get behind “sacrifice the workers”. let's not pretend this is being done for the workers, and even if it is - it is still something to get angry about, because these One Weird Tricks somehow aren't available when the neoliberal regimes we all live under wreck and underfund basic public services, do nothing for anyone else in society who've seen their wages and quality of life decline and funnel wealth towards the already wealthy - which seems to be exactly what happened here? this is the state deciding there's an upper caste of people who deserve to made whole when things go wrong, and everyone else can go hang.
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Mar 13, 2023 12:37
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to clarify that point the fix to people being "capitalist on the way up, socialist on the way down" is not to go for hardcore capitalism both directions.
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Mar 13, 2023 12:37
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mila kunis posted:let's not pretend this is being done for the workers, and even if it is - it is still something to get angry about, because these One Weird Tricks somehow aren't available when the neoliberal regimes we all live under wreck and underfund basic public services, do nothing for anyone else in society who've seen their wages and quality of life decline and funnel wealth towards the already wealthy - which seems to be exactly what happened here? this is the state deciding there's an upper caste of people who deserve to made whole when things go wrong, and everyone else can go hang. “We should increase funding of social services” is both something I agree with and something completely irrelevant to this situation. What is your position? People shouldn’t get paid because rich people defund welfare? You’ve lost the plot. It’s ok to be wrong, you don’t have to double down.
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Mar 13, 2023 12:43
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mila kunis posted:let's not pretend this is being done for the workers, and even if it is - it is still something to get angry about, because these One Weird Tricks somehow aren't available when the neoliberal regimes we all live under wreck and underfund basic public services, do nothing for anyone else in society who've seen their wages and quality of life decline and funnel wealth towards the already wealthy - which seems to be exactly what happened here? this is the state deciding there's an upper caste of people who deserve to made whole when things go wrong, and everyone else can go hang. there’s a whole lot of people who will continue getting paid that aren’t just computer touchers. security guards, janitors, cooks, etc etc. guess which of those groups would be the most likely to lose their jobs in the event every SVB customer had to take a 20% haircut on their deposits?
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Mar 13, 2023 12:44
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Wayne Knight posted:“We should increase funding of social services” is both something I agree with and something completely irrelevant to this situation. What is your position? People shouldn’t get paid because rich people defund welfare? You’ve lost the plot. It’s ok to be wrong, you don’t have to double down. what are you even arguing? it's nice that you, personally, believe funding of social services is something that ought to be done and a real public commons should exist - the state doesn't! they do believe that rich people's assets shouldn't suffer though, this poo poo only goes in one direction!
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Mar 13, 2023 12:46
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mila kunis posted:let's not pretend this is being done for the workers, and even if it is - it is still something to get angry about, because these One Weird Tricks somehow aren't available when the neoliberal regimes we all live under wreck and underfund basic public services, do nothing for anyone else in society who've seen their wages and quality of life decline and funnel wealth towards the already wealthy - which seems to be exactly what happened here? this is the state deciding there's an upper caste of people who deserve to made whole when things go wrong, and everyone else can go hang. what would you have rather happened. also: do you believe the people itt trying to explain this process to you believe that what happened in 2008 was also the correct way to handle things?
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Mar 13, 2023 12:47
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mila kunis posted:what are you even arguing? it's nice that you, personally, believe funding of social services is something that ought to be done and a real public commons should exist - the state doesn't! they do believe that rich people's assets shouldn't suffer though, this poo poo only goes in one direction! try to form opinions too complex for a bumper sticker please.
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Mar 13, 2023 12:52
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Wayne Knight posted:try to form opinions too complex for a bumper sticker please. what?
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Mar 13, 2023 12:57
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poo poo is more nuanced than just “rich people bad” or “government hates the poor”, however true those statements may be. They don’t represent an actual informed opinion on the matter.
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Mar 13, 2023 13:01
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worker salaries are being held hostage by VCs who are happy to and legally allowed to default on that obligation if their demand to be shielded from losses outside of FDIC statues. it’s a power game
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Mar 13, 2023 13:03
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reading the fed statement on their bond swaps had a strong undertone of 'systemic risk!' and i wasn't sure if that was just me or if i was reading it correctly looking at the finance sector stocks this morning i think i was reading it correctly 
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Mar 13, 2023 13:05
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Wayne Knight posted:poo poo is more nuanced than just “rich people bad” or “government hates the poor”, however true those statements may be. They don’t represent an actual informed opinion on the matter. what nuance? a bunch of connected rich people wailed to the government that the fart app companies they'd invested in were in trouble and their friends in high positions made sure money was available for them. ordinary people don't have leverage when it comes to a whole host of poo poo that matters to them, their family, their community and a good quality of life. is that an 'uninformed' view? what the gently caress are you talking about?
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Mar 13, 2023 13:09
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mila kunis posted:what nuance? a bunch of connected rich people wailed to the government that the fart app companies they'd invested in were in trouble and their friends in high positions made sure money was available for them. ordinary people don't have leverage when it comes to a whole host of poo poo that matters to them, their family, their community and a good quality of life. is that an 'uninformed' view? what the gently caress are you talking about? Are you implying that if this was a bank that somehow didn't hold any money linked to rich people, the fed would have intentionally let the banking sector collapse just to spite the poors?
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Mar 13, 2023 13:12
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mila kunis posted:what nuance? a bunch of connected rich people wailed to the government that the fart app companies they'd invested in were in trouble and their friends in high positions made sure money was available for them. ordinary people don't have leverage when it comes to a whole host of poo poo that matters to them, their family, their community and a good quality of life. is that an 'uninformed' view? what the gently caress are you talking about? so you’re just willfully dense, got it
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Mar 13, 2023 13:12
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it’s kind of interesting that this new plan would have stopped SVB from going under at all. so really they are the one sacrifice.
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Mar 13, 2023 13:14
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mila kunis posted:what nuance? a bunch of connected rich people wailed to the government that the fart app companies they'd invested in were in trouble and their friends in high positions made sure money was available for them. ordinary people don't have leverage when it comes to a whole host of poo poo that matters to them, their family, their community and a good quality of life. is that an 'uninformed' view? what the gently caress are you talking about? I’m sorry for failing to realize this wasn’t a productive conversation earlier. You are speculating that the government would not step in to secure depositors if it helped ordinary people, but that is exactly what happened. You cannot seem to comprehend that the impact goes further than the names on the bank accounts. If you wish to remain ignorant, I will no longer stand in your way.
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Mar 13, 2023 13:26
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the people being bailed out are primarily those being paid a paycheck drawn on svb rather than those who own the bank y/n
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Mar 13, 2023 13:27
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Wayne Knight posted:It’s absolutely a bailout, but who cares? It’s not bailing out the bank (it no longer exists), it’s bailing out their (now former) customers. The government has selectively assisted bank customers instead of shareholders. People that have no say in which bank their employer chooses can continue to be paid. Have we forgotten who to hate around here? The most sympathetic group involved was assisted and the least sympathetic wasn’t. SVB didn't get a bailout because it is gone, but the new lending program is available to all banks. so every other bank that did a similarly stupid bet did get a bailout as the board, equity holders, and bond holders in those institutions are now nearly completely protected against the possibility of getting zeroed out. the lending program should have been made with significantly nastier terms or have been made available only to institutions which the FDIC had put into receivership or forced sale of to make it a true last resort. protect the depositors sure, but make sure to gently caress over management and investors who profited from doing the things that necessitated special treatment by the government to protect those depositors.
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Mar 13, 2023 13:30
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PIZZA.BAT posted:reading the fed statement on their bond swaps had a strong undertone of 'systemic risk!' and i wasn't sure if that was just me or if i was reading it correctly it sort of is in that if interest rate risk could be considered systemic, but like, narrowly systemic because nobody (so far) is going "all banks are going to implode due to lack of liquidity from bond mark to market losses", but providing liquidity is absolutely 100% not a bailout in the sense of 'give banks money' or "buy their garbage CDOs pretending they're worth something" e: they should charge Thiel a %for every billion of liquidity provided though
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Mar 13, 2023 13:31
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Captain Foo posted:the people being bailed out are primarily those being paid a paycheck drawn on svb rather than those who own the bank y/n pretending that this is being done to save the poor security guards at Disruptr rather than ensuring VCs don't have a bunch of their investments don't go to zero overnight is some next level shamelessness.
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Mar 13, 2023 13:34
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i mean, if we're going to get into ultimate capitalistic causes it is probably being done more because it'll make the state more money to do it than it would not to do it. even if we assume that the failure would cause no other effects than the loss of deposits , with costs being zero the tax on the first paycheck cleared will be pure profit for the taxpayer.
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Mar 13, 2023 13:38
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mila kunis posted:pretending that this is being done to save the poor security guards at Disruptr rather than ensuring VCs don't have a bunch of their investments don't go to zero overnight is some next level shamelessness. or, it’s being done to protect general confidence in banking period, which is very much in the interest of both of those groups
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Mar 13, 2023 13:39
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mila kunis posted:pretending that this is being done to save the poor security guards at Disruptr rather than ensuring VCs don't have a bunch of their investments don't go to zero overnight is some next level shamelessness. it's being done because having faith in depositing money at banks is fundamental to the whole system. it's not a conspiracy, it is better if deposits do not disappear when interest rates rise. in this case, deposits are being saved and the bank that caused this crisis with poor risk management ate poo poo. it's pretty much the best anyone could rationally hope for.
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Mar 13, 2023 13:40
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Chalks posted:Are you implying that if this was a bank that somehow didn't hold any money linked to rich people, the fed would have intentionally let the banking sector collapse just to spite the poors? they would have let that bank collapse and all those people would have been screwed, yes.
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Mar 13, 2023 13:40
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the feds don't give a poo poo about vcs, they're doing it to save all the other us banks. which they very much do give a poo poo about, because maintaining the us financial hegemony is literally their job.
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Mar 13, 2023 13:40
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Shifty Pony posted:SVB didn't get a bailout because it is gone, but the new lending program is available to all banks. so every other bank that did a similarly stupid bet did get a bailout as the board, equity holders, and bond holders in those institutions are now nearly completely protected against the possibility of getting zeroed out. they'll have to sacrifice the year of coupon they would have received by holding onto the bond so it's not exactly free but yeah it's not expensive either. what i'm wondering is if banks will be able to use this to arbitrate higher bond yields into their lovely 1.5% yields but idk how the language about only being able to do it to make depositors whole plays out in reality. idk
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Mar 13, 2023 13:42
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PIZZA.BAT posted:they'll have to sacrifice the year of coupon they would have received by holding onto the bond so it's not exactly free but yeah it's not expensive either. what i'm wondering is if banks will be able to use this to arbitrate higher bond yields into their lovely 1.5% yields but idk how the language about only being able to do it to make depositors whole plays out in reality. idk if theres a way to arbitrage that the banks will figure it out pretty quickly. so you'll get to find out soon i guess
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Mar 13, 2023 13:48
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what fed needs to do and all signs point to they will do is extend this program to literally every lovely overleveraged badly-risk-managed bank in the nation, which will lead to QE3 in all but name and a pause in interest rates - this is good for stock market the risk of course is that the fed can't do this for the world and there are already signs this could really explode in other countries eventually looping back to USA for now I'm going long on a Canadian bank fund because 1. Canadian banks can't fail 2. they've taken a hit from IR and general market conditions and 3. they've been hammered with SIVB, also I'm Canadian so all my profits will be tax free - I'll risk 10% downside https://www.google.com/finance/quote/HEWB:TSE?hl=en&window=5D edit: whoops wrong symbol Internaut! fucked around with this message at 13:56 on Mar 13, 2023 |
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Mar 13, 2023 13:49
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I mean they literally did do that, the program is open to every bank.
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Mar 13, 2023 13:49
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the arguable upside is that doing this gives lovely banks a hall pass but it also prevents them from being mass-acquired by much larger banks for a song (theoretically), which improves the overall health of the financial sector
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Mar 13, 2023 13:51
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Chalks posted:it's being done because having faith in depositing money at banks is fundamental to the whole system. it's not a conspiracy, it is better if deposits do not disappear when interest rates rise. best within this system that is. i am not very convinced that banking as such should or would be the first thing to go if society were to change for the better, but at minimum the eating poo poo probably should be broader and more public. also the stabilizing deal for all other banks is a bit unnecessarily sweetheart, it is the kind of facility they could place conditions on using. that said it is for sure also better than the "doing nothing" option, just a lot of room between the two.
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Mar 13, 2023 13:52
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the question is whether banks can figure out how to borrow money through that program and then turn around and funnel it straight back into higher-yield treasuries. if they can then they will and then things will get interesting, otherwise it'll all just blow over.
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Mar 13, 2023 13:52
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Jabor posted:the question is whether banks can figure out how to borrow money through that program and then turn around and funnel it straight back into higher-yield treasuries. if they can then they will and then things will get interesting, otherwise it'll all just blow over. the obvious comedy outcome of that move then being that interest rates triple again in a year, so that when the deal lapses they're even deeper in poo poo.
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Mar 13, 2023 13:54
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Jabor posted:the question is whether banks can figure out how to borrow money through that program and then turn around and funnel it straight back into higher-yield treasuries. if they can then they will and then things will get interesting, otherwise it'll all just blow over. nah all that will happen is it will pull down the price of the higher yield bonds. if anything it'll make jay slam the RAISE button even harder
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Mar 13, 2023 13:56
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