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They Break Because That’s What Bubbles Have To Do

A report from the Jax Daily Record in Florida. “In St. Johns County, which has been the longtime market leader, the median price fell from $526,500 in January to $510,000 in February. In February 2022, the median price in St. Johns County was $480,000. It peaked at $575,000 in May 2022. In Nassau County, the median price dropped from $382,635 in January to $366,000 in February. It was down from $410,000 in February 2022 and down from a 2022 high of $417,513 in November. Inventory was up 174.8% over the year to 4,811 homes on the market compared with 1,751 in February 2022.”

Rough Draft Atlanta in Georgia. “Increases in mortgage rates are bringing prices down for the short term in metro Atlanta. Home prices in greater Atlanta in December 2022 were 5% above their December 2021 levels and 9.5% below their June 2022 peak.”

Commercial Appeal Memphis in Tennessee. “February saw a continued trend of fewer homes sold and an overall decrease in median home sales prices year-over-year. The median sale price for local homes dropped 7.8% in February 2023 ($184,500) compared to February 2022 ($200,000). The local market did see an increase in inventory, with 2,760 active listings in February of 2023. That’s up from 2,690 in January and 1,914 in February 2022.”

WTVM Birmingham. “If you’re looking to sell, you’re probably not thrilled that the market has cooled since the pandemic. Real estate professionals in central Alabama say you cannot compare this market to what we were seeing in 2021 and early 2022. Stephen Nix, with Knox Realty in Gardendale, said, ‘What we saw in 2021 and 2022 was not normal, that was not normal at all.’ Stephen and Jecca Nix are a husband-and-wife real estate team. They say what happened during the pandemic, was ‘the perfect storm’ for sellers. Jecca said, ‘Don’t compare it to the pandemic year or the year after because we’re just not going to see that again.'”

Main Line Today in Pennsylvania. “This time last year, the Main Line housing market was in a tizzy, with multiple bidders competing for a limited number of listings. These days, cooler heads are prevailing. Some sellers are quickly reducing asking prices. Here are a few recent examples: In Haverford, a five-bedroom, five-bath home on three-quarters of an acre with a sunroom, pool and pool house was reduced $135,000 to $1.96 million. ‘There isn’t that same feeding frenzy,’ says John Bell of RE/MAX in Chadds Ford. ‘We tell people not to expect 10 offers and $100,000 above asking. If the house is move-in ready and in a desirable location, you might get two offers and $10,000–$20,000 over asking.'”

Shoshone News Press in Idaho. “Our local MLS median single family home is $479,450 down 6.2% over last year. Last year’s pendings are a little understated due to over bidding, therefore when the pending’s close we should be at or below last year. Once these close in the next few months prepare yourself for the Chicken Little news that the real estate sky is falling with headlines proclaiming, ‘OMG Home Prices Are FALLING!’ It is not time to panic.”

The Washington Post. “Employees at start-up Flow Health didn’t get their paychecks Friday morning. When deposits didn’t go out, those in human resources were confused. But Alex Meshkin, the CEO of Flow Health, said he immediately knew what had gone wrong. The company uses another start-up called Rippling to run its payroll process. ‘I said, ‘I guarantee you they’re in Silicon Valley Bank. We’re screwed,’ he said.”

Market Watch. “Samir Kaji, who worked at Silicon Valley Bank for 13 years before cofounding Allocate, said he believed SVB was not at risk of insolvency before its depositors started the mad digital run on their deposits. He said that the bank, which was entrenched in the startup/VC community, benefited from a strong community, ‘which works when it’s going well.’ But he said that what happened in the last two days was equivalent to a stampede running out of the building threatened with fire. ‘But in fear of being the last one out, someone trips on a candle, and sets the building ablaze,’ Kaji said.”

From Bloomberg. “The problems that triggered SVB Financial Group Inc.’s death spiral were hiding in plain sight in the firm’s earnings reports. That’s according to short seller William C. Martin. ‘They had bought all these mortgages at the top of the market and were sitting on a massive unrealized loss,’ he said. ‘And it was sitting there in plain sight. There were a number of other banks and insurance companies with similar issues, but I haven’t seen anyone anywhere near the scale of Silicon Valley Bank.'”

From WRAL. “UNC-Chapel Hill’s Dr. Greg Brown pointed out: ‘It’s going to be, certainly, interesting to watch the train wreck that is Silicon Valley Bank right now.’ He said that before news of the seizure broke. ‘I mean, we know that the VC markets have cooled off, we know that tech, in general, has cooled off,’ said Brown. ‘So I think the question we should be asking ourselves is, ‘Is this more fallout from a tech bubble bursting, that may have very little to do with interest rate policy or broader economic trends?'”

From Fortune. “Investor Jeremy Grantham believes stocks are in a speculative bubble that is slowly deflating. The era of ultralow interest rates and ample liquidity in the market, which had pushed stocks to dramatic highs during the pandemic, is over. Fed officials have long ‘engaged in policies that drive up the prices of assets, other things being even, and create spectacular overpriced bubbles,’ Grantham said before the SVB collapse. ‘They then break because that’s what bubbles have to do. They simply break off their extreme overpricing, and we pay a very tough price.'”

Info-tel in Canada. “There are a lot of gloomy real estate stories around these days. The skyrocketing prices also peaked last year, reaching $1,129,000 for a typical single-family house in the Central Okanagan in March 2022. That dropped by about $150,000 by January of this year. ‘That was the challenge of the first six months with the increased interest rates,’ said Taylor McFadyen, a realtor. ‘A lot of the sellers were still thinking it was top of the market: ‘My neighbour’s home sold for $2 million so mine is worth $2 million.’ It’s a psychological thing. Some people who purchased a property for $300,000 20 years ago are looking to sell for $1.8 million while the market value might be $1.6 million. They’re still doing pretty good.'”

The Globe and Mail in Canada. “As homeowners and investors struggle to cover increased mortgage payments and other debts, there’s been a noticeable spike in the number of short-term rentals. Vacation rental operator Deana Steele has heard from more than 40 investors since the start of the year who want to rent out vacation rental units. Her Keys to Kelowna Properties firm brings short-term rentals online, and she focuses on the high-end market. Right now she’s seeing a glut of all kinds of investors trying to cover their costs by turning to vacation rentals.”

“While the luxury market for short-term rental is thriving, average investors are having a tougher time, she says. Even though short-term rentals can command rents that are up to four times that of long-term rentals, that’s not always enough to cover their new financing. A lot of them are dealing with construction delays that have them completing at a higher rate, says Ms. Steele.”

“‘All these enquiries are coming in, and I can’t save them, the market is so saturated,’ she says. ‘The delay in closing for the new construction was really damaging to their projections. The only way to make up for those numbers is short-term rentals. It’s a huge loss to go long term,’ she says. ‘At the moment, most people I speak with don’t want to sell, because they do see there will be some long-term gains but they realize there will be some short-term subsidies from their income to cover these properties, so it’s a little stressful.'”

“Ms. Steele has a client with a two-bedroom townhouse whose investor owner is looking at $5,500 in carrying costs, including the speculation and vacancy tax he will be required to pay on his vacation rental. There are other taxes, financing costs and utility bills. The start-up cost of furnishing and stocking the unit is around $52,000, she says.”

“In response to the new supply of short-term rental units, a lot of new operators are coming into the market, she says. ‘I think we are going to see another surge of listings come on as one last kick at the can for these investors, to make it work.’ She’s focusing on the luxury market because so many mansions sit empty ’90 per cent of the year.’ ‘All of them are for personal use … they are sitting vacant.'”

The South China Morning Post. “Authorities will not slash land prices but will equally seek to avoid rocketing valuations, Hong Kong’s finance chief has said, vowing to stick to the government’s goal of providing a sustainable and stable supply of housing. Financial Secretary Paul Chan Mo-po offered the reassurances on Saturday as he shrugged off the result of the government’s first land sale of the year where a prime commercial plot in Mong Kok was bought for HK$4.73 billion (US$602.5 million), or 35 per cent less than the low end of its valuation.”

“‘We can say that the government does not have a high land price policy, which had drawn criticism in the past. But we won’t sell land at dirt cheap prices either,’ he said in a televised interview.”

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  1. ‘All these enquiries are coming in, and I can’t save them, the market is so saturated,’ she says. ‘The delay in closing for the new construction was really damaging to their projections. The only way to make up for those numbers is short-term rentals. It’s a huge loss to go long term,’ she says. ‘At the moment, most people I speak with don’t want to sell, because they do see there will be some long-term gains but they realize there will be some short-term subsidies from their income to cover these properties, so it’s a little stressful’

    That’s some red hotcakes right there.

    ‘We can say that the government does not have a high land price policy, which had drawn criticism in the past. But we won’t sell land at dirt cheap prices either’

    Hold yer ground Paul, don’t give it away.

    1. The Financial Times
      Silicon Valley Bank
      Yellen says government will help SVB depositors but rules out bailout
      Treasury secretary says policies being formulated to stem fallout of tech lender’s collapse
      Janet Yellen said reforms since the financial crisis mean there would be no bailout of SVB.
      Colby Smith in Washington 35 minutes

      Janet Yellen said on Sunday that the US government was working closely with banking regulators to help depositors at Silicon Valley Bank but dismissed the idea of a bailout.

      Speaking with CBS on Sunday, the treasury secretary sought to assure US customers of the failed tech lender that policies were being discussed to stem the fallout from the sudden collapse this week. The Federal Deposit Insurance Corporate (FDIC) took control of the bank on Friday morning.

      “Let me be clear that during the financial crisis, there were investors and owners of systemic large banks that were bailed out . . . and the reforms that have been put in place means we are not going to do that again,” Yellen said.
      …

      1. Finance
        “Too Big To Fail” Must Go
        Joe Weisenthal
        Mar 11, 2009, 9:40 AM

        As politicians go to work on re-regulating Wall Street, the guiding principle should be that no institution is too big to fail. No institution should become so important to the financial system that government must intervene in order to avoid a catastrophic collapse of the financial system in the event that it goes under.

        It’s not just that it’s costly to bail out said institutions, it’s worse — it’s that counterparties to a TBTF institution believe that their dealings are risk-free, and thus the riskiest, most dangerous trades are the most profitable.

        Case in point: The banks that bought CDS from AIG, basically seeing it as a free lunch to insure their entire portfolios, while knowing full well that there’s no way a company like AIG could cover the entire world.

        This moral hazard question, as it turns out, isn’t a theoretical problem that folks in the do-nothing media can complain about. It’s at the core of the problem.

        NYT’s David Leonhardt pulls up a great paper written by George Akerlof and Paul Romer entitled “Looting”. In it they argue that multiple financial crises can be explained by this phenomenon, the belief that a counterparty is too big to fail.

        The paper can be downloaded here. Here’s the abstract:
        …
        https://www.businessinsider.com/too-big-to-fail-must-go-2009-3

        1. The paper link in the old article I posted was broken, but this should do:

          Looting: The economic underworld of bankruptcy for profit
          George A Akerlof, Paul M Romer, Robert E Hall, N Gregory Mankiw
          Brookings papers on economic activity 1993 (2), 1-73, 1993
          DURING THE 1980s, a number of unusual financial crises occurred. In Chile, for example, the financial sector collapsed, leaving the government with responsibility for extensive foreign debts. In the United States, large numbers of government-insured savings and loans became insolvent-and the government picked up the tab. In Dallas, Texas, real estate prices and construction continued to boom even after vacancies had skyrocketed, and then suffered a dramatic collapse. Also in the United States, the junk bond market, which fueled the takeover wave, had a similar boom and bust.

          https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=looting+akerlof&btnG=#d=gs_qabs&t=1678630473831&u=%23p%3DbaI5LkjfNmsJ

          1. It might dismay financial entities who believe themselves too-big-too-fail to realize Yellen’s husband was lead author on this paper.

      2. “Yellen says government will help SVB depositors but rules out bailout”

        Let me get that straight: No bailout, but SVB depositors will get bailed out.

        Can someone please explain?

          1. WaMu got taken by J.P.M. Chase and it is rumored that J.P.M. Chase has been aggressively targeting large customers of SVB which is what really caused the run. Fun Fact: The WaMu branch that I used to bank at which became Chase was burned to the ground in the riots. It had been my opinion that parts of SoCal were going to burn but I didn’t realize it would be so close to home.

        4. The difference between ‘investors’ in the bank i.e. Bill Ackman and ‘depositors’ at the bank i.e. Roblox who had $2.6B there.
          Lots of tears for Bill and lots of waiting for Roblox.

      3. Janet Yellen said on Sunday that the US government was working closely with banking regulators to help depositors at Silicon Valley Bank but dismissed the idea of a bailout.

        FDIC limits are there for a reason, Old Yellern. This nasty old skank is part of the entrenched rot in the system.

        1. FDIC limits

          Beyond the FDIC limit, aren’t so-called depositors entitled to their share of the failed bank’s assets?

  3. ‘I said, ‘I guarantee you they’re in Silicon Valley Bank. We’re screwed’

    Alex, put yer short term greed on hold and consider the weather. Tell the mortgage company the truth of what happened and maybe they’ll give you forbearance or something.

    1. A friend’s husband recently started at Teledoc Health. Its last funding round was with SVB for $80M. 😳

  4. ‘you cannot compare this market to what we were seeing in 2021 and early 2022. ‘Don’t compare it to the pandemic year or the year after because we’re just not going to see that again’

    Jecca is right. Forget about the past two years like it never happened. Now about those loans…

    1. we’re just not going to see that again

      What’s funny is that just about every new pre-spring listing I see is at peak pricing+. It’s the year of the dreamers.

  5. The median sale price for local homes dropped 7.8% in February 2023 ($184,500) compared to February 2022 ($200,000).

    Gosh, these “investments” seem to be shedding a lot of value month over month. It almost makes one want to sit on the sidelines until the bottom is in.

  6. Once these close in the next few months prepare yourself for the Chicken Little news that the real estate sky is falling with headlines proclaiming, ‘OMG Home Prices Are FALLING!’ It is not time to panic.”

    I smell fear – is that you, REIC dissemblers?

  7. Today is Sunday.

    Pray for the Christian Nationalist Homeland, because Weimar America will be ending soon.

    Marxist globalists, this isn’t your country, and your days are numbered…

    1. Is this a parody of what a glowie would say in an online forum? I saw some pictures out of Ohio of some rally against a drag show and it was basically three masked fed groups with some proud boys who are filled with fed informers. Like nobody really talks like this.

      1. Like nobody really talks like this.

        Sparky is 💯 sincere. If you go down the rabbit holes far enough, this is the realization. While I may not agree with his presentation, I agree with his sentiment. I personally have my own issues with organized religion having Mennonite missionaries as grandparents.

  8. But Alex Meshkin, the CEO of Flow Health, said he immediately knew what had gone wrong. The company uses another start-up called Rippling to run its payroll process. ‘I said, ‘I guarantee you they’re in Silicon Valley Bank. We’re screwed,’ he said.”

    But…but…new economy! Industry disrupters! Exceptional ESG scores!

  10. ‘Once these close in the next few months prepare yourself for the Chicken Little news that the real estate sky is falling with headlines proclaiming, ‘OMG Home Prices Are FALLING!’

    More little sh$tholes see the YOY crater right ahead of them.

    1. “More little sh$tholes…”

      I’m living in one of them myself. Our preferred poison before 2008 was HELOC borrowing, but this time it’s ridiculously high RE prices like everywhere else. There simply isn’t enough economic activity in our area to support these recent mortgages.

  14. ‘They had bought all these mortgages at the top of the market and were sitting on a massive unrealized loss,’ he said. ‘And it was sitting there in plain sight.

    This keeps getting better & better.

    1. They had bought all these mortgages at the top of the market and were sitting on a massive unrealized loss,’ he said. ‘And it was sitting there in plain sight.
      Were they not doing any GAP analysis hedging their short term assets/liabilities to their long term assets/liabilities.
      I did GAP analysis for a bank subsidiary in the mid 1990’s and it was taken seriously and we occasionally had to swap fixed rates for variable rates with our “parent.”

  17. Scouring the internet, it appears that “Make every deposit whole” seems to be the rallying cry.

    Same ol’ same ol’

      1. Is it too early to bring back “we’re all in this together” ?

        Remember that line? They used to play it over the speakers at my local grocery store every five minutes back in 2020-2021.

  20. ‘They had bought all these mortgages at the top of the market and were sitting on a massive unrealized loss,’ he said. ‘And it was sitting there in plain sight. There were a number of other banks and insurance companies with similar issues, but I haven’t seen anyone anywhere near the scale of Silicon Valley Bank.’”

    Yet ..

  21. A reader sent these in:

    Will Daly be fired for supervisory failure? Ofc not! She will be promoted!

    https://twitter.com/INArteCarloDoss/status/1634526522873634817

    Question everyone is asking

    https://twitter.com/INArteCarloDoss/status/1634483692637765632

    Also, stop with this « but companies won’t be able to make pay » drama sh$t. SVB depositor list is a Babylonian whorehouse: crypto chills, SPAC scams, bullsh$t climate start-ups that will never earn a dime of CF ever…Ofc there are some good ones in there too but perspective 1/2

    https://twitter.com/INArteCarloDoss/status/1634464495517982720

    US Discusses Fund to Backstop Deposits If More Banks Fail

    https://twitter.com/DylanLeClair_/status/1634731858427518978

    I personally don’t think this is systemic, and would say that the risk of snowballing bank runs is wildly overstated. To understand why, you gotta understand what went wrong besides just SVB getting a little greedy on duration.

    https://twitter.com/coloradotravis/status/1634724018392813568

    The Kobeissi Letter

    Silicon Valley Bank, $SIVB, Management Team:
    1. CEO: Director at San Francisco Fed
    2. CFO: Former analyst at Freddie Mac
    3. Chief Admin Officer: Former CFO of Lehman Brothers
    4. Chief Risk Officer: Led credit ratings in 2007
    5. Chief Legal Officer: General Counsel at Citibank in 2008
    Over the last 2 weeks, management sold nearly $5 million in stock.
    Who thought this team would work?

    https://twitter.com/KobeissiLetter/status/1634621125073203200

    “Taxpayers have to make me financially whole or poor people will suffer.” – rich people

    https://twitter.com/GRomePow/status/1634560048105144321

    The oddest thing is this is the exact same weekend that Bear Stearns went under 15 years ago.

    https://twitter.com/hmeisler/status/1634546473713950720

    SVB shouldn’t be bailed out because they were a bunch of f*cking idiots. I can’t believe we’re having this conversation

    https://twitter.com/dailydirtnap/status/1634598047790374912

    Is there a better poster child for “privatizing gains and socializing losses”? $SIVB This concentration and corruption is cannibalizing capitalism. Market, show me you care.

    https://twitter.com/SamanthaLaDuc/status/1634588928891052032

    “Double disaster for everyone involved” 📍Brampton, ON 🇨🇦 “Price discovery” and “Power of Sale” madness 🔥🔥🔥 Buyers bid $177K over asking in February 2022 only to lose the house to the bank. Bank sells for $430K under what buyers bought it for. What happens now? #ToRE 👇

    https://twitter.com/ShaziGoalie/status/1634672822529187846

    SIVB used low lending standards to attract unprofitable tech cos then took their deposits and gambled on MBS. You want to encourage that again next cycle? A bit of short term pain is necessary. Everyone knew the 250k rule and they ignored it so they could get preferential loans to fund their unprofitable moonshots. Bubbles burst and the gamblers get ruined. That’s capitalism.

    https://twitter.com/donnelly_brent/status/1634576133654999042

    According to this: A $600,000 house in Austin last Feb 2022. Now worth about $522,000 today.

    https://twitter.com/atxREpodcast/status/1634651283805339648

    Decisions and consequences. From Bloomberg: Brad Hargreaves, who has founded three companies, including General Assembly, says he considered taking a loan from Silicon Valley Bank a few years ago but found the terms too onerous. In order to take out a loan, he says he would have also had to do his banking with them as well. Part of the bank’s pitch was how they could tend to all aspects of a founder’s finances, he says.

    “They would not only be the corporate lender and corporate bank for your startup, they would also provide a mortgage for your house as a founder. They would be your personal wealth manager,” says Mr. Hargreaves. “They’re very highly integrated in a lot of aspects of founders’ lives.”

    https://twitter.com/donnelly_brent/status/1634635736040239104

    So many think 2% inflation is fine. Here’s what I’d love everyone to understand…In a 40 year working life:
    2% inflation destroys 55% of the value of your money.
    4% is 79% loss
    6% is 90% destruction
    THEFT!

    https://twitter.com/Gary_Brode/status/1634661064146137091

    Bailouts in the UK 🧐 The UK government is coordinating an emergency meeting with tech firms, who are expected to call for state intervention to avoid the failure of hundreds of firms following the collapse of Silicon Valley Bank ⚠️

    https://twitter.com/WallStreetSilv/status/1634709657720586240

    Moody’s credit rating of A just 3 days ago – 🤡 “If we don’t rate them high they’ll go down the street and get the rating they want and we’ll lose their business.” – Moody’s (probably)

    https://twitter.com/WallStreetSilv/status/1634653838954184705

    CarDealershipGuy

    Auto loan rates have hit new records:
    New cars: 8.67%
    Used cars: 13.65%
    Are we witnessing the top or more pain to come?

    https://twitter.com/GuyDealership/status/1634567044069818368

    Should Silicon Valley Bank customers with deposits above the FDIC-insurance limit ($250k/person) be bailed out?

    https://twitter.com/charliebilello/status/1634323228301639680

    It begins.

    Warnings of another Lehman attended by crying from wealthy investors:
    https://cnbc.com/2023/03/11/silicon-valley-bank-failure-has-investors-calling-for-government-aid.html
    “We capitalists demand socialism!”
    Bailing out venture capitalists. Never going to happen.
    FYI, Schwab’s worst week on record. Fully predicted by EWT.

    https://twitter.com/SuburbanDrone/status/1634706497090338821

    Three days ago:
    Zerohedge: Who’s heard of Silvergate?
    Two days ago:
    Zerohedge: Who’s heard of Silicon Valley Bank?
    Next week: Who’s heard of Bank of America?

    https://twitter.com/SuburbanDrone/status/1634414991380971523

    Let the bank collapse.

    https://twitter.com/great_martis/status/1634700598502387712

    Breaking news!! Zelensky to bail out SVB monday.

    https://twitter.com/great_martis/status/1634686408769286145

    What happens to the Big four pillars when residential and commercial property markets deleverage ? Most think 20 to 30% correction . Im predicting 70 to 80% . The amount of supply that will hit the market will be mind bending . Australia is in real trouble .

    https://twitter.com/great_martis/status/1634303665510174720

    once we’ve got these pesky bank failures out the way, it’s back to rate hikes and QT as usual

    https://twitter.com/concodanomics/status/1634746662005399555

    You’ve had FTX, SI, SIVB all go under in the last 6 months and 2 weeks ago many thought a new Bull market was starting. This is just getting started. #creditcycle

    https://twitter.com/highyield6/status/1634662782212751363

    More good news from US economy

    https://twitter.com/AlessioUrban/status/1634602724162510848

    🚨LOL, LMAO. COINBASE IS LITERALLY USING THE FTX PLAYBOOK.

    https://twitter.com/MikeBurgersburg/status/1634562062138458112

    2. I personally don’t think this is systemic, and would say that the risk of snowballing bank runs is wildly overstated. To understand why, you gotta understand what went wrong besides just SVB getting a little greedy on duration.

      SVB was a wealthy person’s bank. Seeing a bank run in Brentwood, CA is hilarious. They also showed one in a tony neighborhood in Bwahhston. Rich people squeal like a gutted hyena when they lose money. Fawk ’em.

    3. LOL, LMAO. COINBASE IS LITERALLY USING THE FTX PLAYBOOK

      These cryptos are higher after the FTX and SVB collapses than before. When you’ve got shills like Musk pimping them, this is what happens. The real collapse won’t be here until we see the entire crypto market collapse to zero.

    4. Auto loan rates have hit new records:
      New cars: 8.67%
      Used cars: 13.65%
      Are we witnessing the top or more pain to come?

      Nope. The “top” will be when manufacturers are offering $30k discounts on new trucks and SUVs.

  23. Remember, “the next pandemic” = the end of all of your freedoms, forever. They’re already cooking it up in the lab, and you can be certain that all The Right People will be making a lot of money from it.

    New York Times — How to Prepare for the Next Pandemic (3/12/2023):

    “Late last year, I participated in an exercise meant to play out what might happen if the world was presented with a new disease spreading quickly, with no warning.

    The exercise revolved around a number of simulated emergency meetings of the World Health Organization advisory board, called in response to a very serious new pandemic — a risk that the W.H.O. refers to as “Disease X.”

    Among the exercise participants were highly experienced current and past health ministers and senior public health officials from nine countries. The urgent events required them to make hard policy decisions quickly, with little information. Each decision had huge consequences for society and for the course of the pandemic. This was how it was in the early days of Covid. It’s also how it will be in other pandemics.”

    How it will be?

    How it’s gonna be, is that any attempt to force a lockdown or close businesses in the United States, will be, must be, met with mass violence.

    “Some of the smartest and most experienced international public health leaders had differing, sometimes opposing views on many fundamental questions about the response. Should they shut down travel in the earliest days? Should they close schools in the first affected countries? If a future pandemic has a much higher case fatality rate than Covid or if it severely affected children, should countries take different, stronger, faster measures to contain it? Top experts don’t yet agree.”

    If it severely affected children?

    You know that the next batch they are making now WILL target children. Because there’s no easier path to tyranny than a bunch of dead kids.

    Dead grandmas wasn’t effective last time, so this time they’re gonna run with dead kids. Lots of dead kids.

    “The world needs to be prepared for the next Disease X, something capable of causing global catastrophic risks. Here’s what it would take to collect all we learned from Covid and to transform our preparedness.

    We need to get vaccines in arms much faster.

    A number of countries call this commitment the 100-day mission — referring to the number of days it should take to develop a safe, effective vaccine after the sequencing of a novel pandemic virus.”

    https://archive.is/igFLy

    That last excerpt, they are literally saying they NEED TO KILL YOU FASTER with their alleged vaccines.

    It’s a medical genocide.

    1. effective vaccine after the sequencing of a novel pandemic virus.

      That part should be easy. IIRC the last bug was sequenced before it was released.

      1. Covid was the greatest FRAUD of my lifetime. We can never let them do this to us again.

        Never forgive. Never forget.

  24. a question : if SVB lost about 9% on its bond sale, and liquidated wouldn’t uninsured depositors get back about 90% anyway?

    Then SVB revealed it was selling its available-for-sale (AFS) bond portfolio for $21 billion, and the bank lost a total of $1.8 billion from the sale

    1. if SVB lost about 9% on its bond sale, and liquidated wouldn’t uninsured depositors get back about 90% anyway?
      In the vein of “stupid should hurt”, yes everyone over $250K must lose a portion of their money be in 10% or 25% or… Hell, in mid 2000’s I made sure all my bank accounts were under $100K because that was max insurance and I moved my money out of money funds because they were NOT insured at the time. These CFO/CEO/VCs are supposed to be geniuses, truth be known, they are just lazy, as they could have been wiring funds to SVB daily when funds were needed. and had accounts with dozens of other banks to reduce the risk.

    2. FDIC has mentioned that depositors will receive 50% of their uninsured deposits this Monday and a ‘certificate’ stating the rest paid out in proportion when all assets are fully sold. That will take time as some bonds have been on banks balance sheets for years ‘marked to model’ since 2010 (last crisis). It’ll probably be a total return of uninsured deposits around the 80% level (my guess). Not truly end of the world, but pretty painful for a bunch of tech startups that were counting on that money as their runway to bankruptcy.

      1. so it changes the date they declare bankruptcy by 2 weeks earlier. Seriously, who cares?

        If they bail these f*(&ckers out AGAIN while people who follow the rules get boned AGAIN, I’m going to be a wee bit grumpy.

      2. but pretty painful

        And what’s going to be done for East Palestine? Oh, that’s right. Welfare for rich liberals. Screw Trump voting Ohioans.

  25. I have been too busy with a kid who is trying to walk and into literally everything, so I haven’t been able to keep up with every blog.

    Anyway, at the end of last year I had a friend tell me that her husband and she were putting money down on a new build by Lennar. I cautiously advised her to reconsider, but I wasn’t too blunt because I didn’t want to over due it.
    Anyway, I saw her husband at church today. Their pipes got backed up and apparently their neighbor’s sewage got into their house and has destroyed it. Evidently something was going on during their date of closing and the builder didn’t disclose this issue to my friend’s family.
    Hopefully they’ll hire a lawyer and sue.

    1. “Hopefully they’ll hire a lawyer and sue.”

      More than likely it wasn’t just their neighbors sewage it was theirs too.

      Hopefully they’ll get a plumber to clear drain line where the two house lines meet before they get to the main first.

      But putting money down on a new Lennar home in Florida at the end of last year was a really bad move and something you should be proud of for trying to talk them out of.

      1. The moved in last weekend, so whoever’s sewage it was was enough to leave over an inch of poo water in their house.

        1. most household policies have a special insurance rider you can buy that covers sewage backups and cleanups. (otherwise not covered). it’s pretty cheap and any good agent should make sure you are at least aware of it. Of course they were in a big hurry to get into their ‘new house” that’s totally different from the 876 just like it in that development alone so probably just went with lowest cost.

        2. The moved in last weekend, so whoever’s sewage it was was enough to leave over an inch of poo water in their house.”

          Quite the husewarming present.

      2. ‘More than likely it wasn’t just their neighbors sewage it was theirs too’

        And it could have been stuck to the ceiling of the drain for a few weeks.

    1. Used Rolexes Are Beating the Stock Market
      Secondhand luxury watches have become increasingly popular in recent years, particularly with younger buyers, a new report says
      Some collectors see luxury watches as investment pieces.
      Leon Neal/Getty Images
      By Alyssa Lukpat
      March 12, 2023 7:00 am ET

      One of the hottest collector’s items these days is a preowned luxury watch.

      Expensive secondhand watches from brands such as Rolex and Patek Philippe have become increasingly popular in recent years, particularly with younger buyers, according to a report published this month by Boston Consulting Group. Preowned luxury watches became more valuable as demand grew but supply remained tight, BCG said.
      …

      1. Lazy reporting. That bubble popped long ago:

        Rolex Reseller Chrono24 Cuts Jobs as Pre-Owned Watch Prices Fall

        1. That story brings to mind a used boat bubble episode that ended badly in the 2007-2009 crash. It seems like there is no limit on the variety of bubbles the printing press money can inflate.

          1. The Wall Street Journal
            Flip That Yacht
            Rich Buyers Sell Unfinished Boats, Reaping Millions in Profits
            By Robert Frank
            May 25, 2007 12:01 am ET

            Terry Taylor, a Florida car dealer, has purchased five yachts since 2001. But don’t expect to see him anchoring off the coast of Cannes this week. Mr. Taylor is boatless, having sold all of his yachts to other buyers for huge profits.

            “I wouldn’t feel too bad for Terry,” jokes Felix Sabates, a partner in Trinity Yachts of Gulfport, Miss., which built Mr. Taylor’s boats. “He’s probably made more money off those boats than we did.”
            …

          2. People wanted to live on boats around here then. Friends of mine sold their crappy “houseboat” and bought a nice cabin cruiser with half the proceeds.

    1. ‘sitting on unrealized losses of $620 billion’

      And to think every one had a US guberment guarantee.

      1. If my understanding is correct and assuming they’re treasuries, those losses will diminish as time goes on/the bonds get closer to maturity. So if the banks can avoid a run/having to firesale assets, the issue will mitigate itself over time.

        1. ‘those losses will diminish as time goes on/the bonds get closer to maturity’

          While inflation eats the whole pie and more.

          1. Ironically, they were happy as clams during the big inflation and now cry “Mommy” when deflationary steps are taken.

  28. You will drink the mRNA infused fake milk.

    Washington Post — Cowless dairy is here, with the potential to shake up the future of animal dairy and plant-based milks (3/12/2023):

    “Dozens of companies have sprouted up in recent months to develop milk proteins made by yeasts or fungi, including Perfect Day, the California-based dairy company that laid out this unusual spread. The companies’ products are already on store shelves in the form of yogurt, cheese and ice cream, often labeled “animal-free.” The burgeoning industry, which calls itself “precision fermentation,” has its own trade organization, and big-name food manufacturers such as Nestlé, Starbucks and General Mills have already signed on as customers.

    The rapid advancement in this area has sparked hope for a revolution in the dairy industry, and not just because it’s kinder to the cows. Precision dairy doesn’t have cholesterol, lactose, growth hormones or antibiotics (though those with dairy allergies should beware). And cattle, for beef or dairy, is said to be the No. 1 agricultural source of greenhouse gases worldwide. Consumers concerned about climate change or animal welfare have been anticipating the U.S. launch of cultivated meat, which is grown in labs from animal cells, but cultivated dairy could have just as much of an impact on the environment — with fewer regulatory hurdles to clear.”

    https://archive.is/r0UCa

    A reminder, at last year’s G20 summit in Bali, the attendees dined on wagyu beef.

  29. Ooooh doggie! I’m personally hearing big batches off boo hoo about SVB. We went out saturday with a good friend who is an attorney and acct who does VC work(not sure what that actually means nor do I care to understand). He’s done. Busted. Today heard from my brother about his friend who has to “liquidate property”… That clown is blaming everybody and everything with some victim narrative. he sent me the text…. whoa what a load of BS. I told my brother get f%cking real junior. Do you really think this guy going tits up 3 days after SVB is a coincidence? F#$%king idiots.

    1. PS… the clown who has to liquidate property is some great software guru…….. and a degenerate gambler….. BOO HOO HOO!🤣

  30. Covid vaccines are poison.

    The Guardian — Florida surgeon general’s Covid vaccine claims harm public, health agencies say (3/12/2023):

    “US health agencies have sent a letter to the surgeon general of Florida, warning that his claims about Covid-19 vaccine risks are harmful to the public.

    The letter was sent to Joseph Ladapo on Friday by the US Food and Drug Administration (FDA) and the Centers for Disease Control and Prevention (CDC). It was a response to a letter Ladapo wrote to the agencies last month, expressing concerns about what he described as adverse effects from Covid vaccines.

    “It is the job of public health officials around the country to protect the lives of the populations they serve, particularly the vulnerable,” said the federal letter, which was signed by the FDA commissioner, Robert Califf, and CDC director, Rochelle Walensky.

    “Fueling vaccine hesitancy undermines this effort.”

    https://www.theguardian.com/us-news/2023/mar/12/florida-surgeon-generals-covid-vaccine-claims-harm-public-health-agencies-warn

    Blood clots, heart attacks, and strokes are “harmful to the public” but here at the HBB we remember how these tyrants closed all the gyms during the scamdemic, but kept all the liquor stores and weed dispensaries open, because reasons.

    1. Hailey Bieber Reflects On Her Mini-Stroke 1 Year Later (3/11/2023):

      “On Friday, the model posted on her Instagram story a video she created in April 2022 where she discussed having experienced a transient ischemic attack, often called a mini-stroke, the previous month.

      “Can’t believe it’s been 1 year since I suffered a mini stroke that led to my PFO diagnosis,” Bieber wrote in a text overlay on her post Friday. “Given that it’s the 1 year mark from such a life changing event, I wanted to share all the information I’ve learned about PFO and share resources to donate.”

      In the 2022 video describing her health condition, Bieber said that doctors told her she had a small blood clot that traveled into her heart, then through the hole in her heart, and eventually to her brain.”

      https://www.huffpost.com/entry/hailey-bieber-mini-stroke-1-year-later_n_640ceb5be4b0ebf03d365c58

      How old is she, 26? And her husband cancelled his world tour because some kind of palsy making his face droop.

      With their level of fame, what a squandered opportunity to warn the public, especially young people, about the deadly dangers of this mRNA poison.

      1. And terrified of even breathing a word about what caused it, for fear of being canceled and bankrupted by “the machine.”

  31. Property taxes.

    Property taxes, because you are paying to promote this in the public schools. 6 years old? This is what happens in dying civilizations that have been conquered from within by Marxist globalists.

    Our 6-Year-Old Wanted To Use ‘They/Them’ Pronouns. We Had No Idea What We Were In For (3/11/2023):

    “By October 2021, I have done a lot of reading about nonbinary and transgender people, especially children. I have learned that the younger a child begins to transition, the more likely it is not to be a phase. I have read about the higher depression rate, anxiety rate and suicide rate in the nonbinary and transgender community, especially among children and teens. I have learned that if you support your child or teen at home, they will probably have the same mental health status as their cisgender peers. I have learned the term “cisgender”: It means someone whose gender identity aligns with the gender they were assigned at birth. Like me. I’m cisgender. My husband is cisgender. And in October 2021, he’s still not convinced that this change is Rachel’s doing.

    “But who is starting all these conversations?” he still wants to know.

    https://www.huffpost.com/entry/transgender-child-nonbinary-pronouns_n_63ff8de4e4b0bdb99f498a2e

    Who, your husband asks? Groomers, that’s who.

    And when Weimar America ends, those groomers get fed into a woodchipper. Marxist globalists, this isn’t your country.

    1. “cisgender”: It means someone…

      was half asleep in Chemistry made up a peculiar peculiar word without meaning.

      1. It came out of academia (see also: Marxist globalists). I posted an article about the term’s origin a few weeks ago, probably some HuffPaint or Salon garbage.

        And I share these links so all you HBB’ers can know what your property taxes are paying for.

        Beyond the moral rot of Ancient Rome at this point…

        1. Beyond the moral rot of Ancient Rome at this point…

          Will tourists, 2000 years from now, walk down the ruins of the mall in DC like they walk down the ruins of the Roman Forum today, or will it have crumbled and turned into dust by then?

    2. It means someone whose gender identity aligns with the gender they were assigned at birth.

      Assigned? They make it sound like someone spun a wheel (The Wheel of Gender?) when you were born and they arbitrarily assigned a gender to you, and that biology had nothing to do with it.

      Heinlein’s Crazy Years. I hope we will survive them.

    3. If you call yourself “cis”, you are part of the problem and very likely you are the reason your kid started on its road to madness.

  32. Billionaire investor Bill Ackman wrote Saturday that the federal government had about two days to fix the problem—by Monday morning. He noted that a number of depositors may not see their money because it wasn’t insured; the Federal Deposit Insurance Corporation (FDIC) notes it insures $250,000 per depositor, per insured bank for each account.

    “The gov’t has about 48 hours to fix a-soon-to-be-irreversible mistake,” Ackman posted on Saturday morning. “The giant sucking sound you will hear will be the withdrawal of substantially all uninsured deposits from all but the ‘systemically important banks’ (SIBs),” he wrote, adding that more “withdrawals will drain liquidity from community, regional, and other banks and begin the destruction of these important institutions.”

    “SVB’s senior management made a basic mistake. They invested short-term deposits in longer-term, fixed-rate assets. Thereafter short-term rates went up and a bank run ensued. Senior management screwed up and they should lose their jobs,” Ackman wrote.

    https://www.theepochtimes.com/federal-government-has-48-hours-to-fix-irreversible-mistake-billionaire-says_5117078.html

    2. He noted that a number of depositors may not see their money because it wasn’t insured; the Federal Deposit Insurance Corporation (FDIC) notes it insures $250,000 per depositor, per insured bank for each account.

      Which is how the system should work. STFU, Bill.

        1. I already have 11 accounts across 2 institutions and 4 tax filings a year before considering my husband’s accounts. I’d need at least another 8 accounts to heed that recommendation. 🤪 FWIW, the largest accounts aren’t mine. I manage a 501c3 and GST.

          2. HA HA. /s I’d give anything to have my mother alive and not have a disabled child.

          3. The 501c3 refunded on her death. Knowing colon cancer would take her out, she left the house to her only grandchild with autism. FU!

    3. This piece reminds me of the bond king, Bill Gross, back in 2007 squealing like a trapped hog, and calling on the fed to build a floor under home prices.

      ***

      It was “paramount” for the Federal Reserve through fiscal policy measures “to in effect put a floor under housing prices in order to stop the deterioration in this asset-based economy”, he said.

  33. ‘In St. Johns County, which has been the longtime market leader, the median price fell from $526,500 in January to $510,000 in February. In February 2022, the median price in St. Johns County was $480,000. It peaked at $575,000 in May 2022. In Nassau County, the median price dropped from $382,635 in January to $366,000 in February. It was down from $410,000 in February 2022 and down from a 2022 high of $417,513 in November’

    Most people never heard of these sh$tholes, but I remember them. These prices are way above 2005.

  35. ‘Even though short-term rentals can command rents that are up to four times that of long-term rentals, that’s not always enough to cover their new financing’

    There’s been some sound lending going on in igloo country.

  37. ‘they realize there will be some short-term subsidies from their income to cover these properties, so it’s a little stressful’

    That’s the spirit Deanna, keep the subsidies coming!

    1. Another bank blows up!
      $SBNY
      Quote Tweet
      Investing.com
      @Investingcom
      ·
      26m
      *U.S. SAYS SIGNATURE BANK CLOSED TODAY BY STATE AUTHORITY

        1. Regulators close crypto-focused Signature Bank, citing systemic risk
          Published Sun, Mar 12 2023 6:24 PM EDT
          Updated 4 Hours Ago
          Yun Li
          A man entering Signature Bank in New York City on March 12, 2023.
          Reuters

          U.S. regulators on Sunday shut down New York-based Signature Bank, a big lender in the crypto industry, in a bid to prevent the spreading banking crisis.

          “We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority,” Treasury, Federal Reserve, and FDIC said in a joint statement Sunday evening.
          …
          https://www.cnbc.com/2023/03/12/regulators-close-new-yorks-signature-bank-citing-systemic-risk.html

  39. Yesterday they said something like 96% of deposits were covered by the FDIC for $250,000 per account. They must have had a lot of high $ Silicon Valley well connected Democrat deposits.

    FDIC Will Protect All Silicon Valley Bank Deposits After Sudden Collapse, Treasury Says

    Marisa Dellatto
    Forbes Staff

    Joe Walsh
    Forbes Staff

    Mar 12, 2023
    6:35pm EDT

    TOPLINE Federal regulators will safeguard all deposits at Silicon Valley Bank, including money that isn’t normally covered by federal deposit insurance, the Treasury Department announced Sunday evening, a rare and sweeping move just days after the tech-focused bank rapidly collapsed.

    Account holders will be able to access all of their deposits on Monday, the Treasury, Federal Reserve and Federal Deposit Insurance Corporation said in a statement.

    The FDIC usually only insures $250,000 per account, but it can use its funds to protect uninsured deposits if the Treasury Secretary and two-thirds of the FDIC and Federal Reserve boards determine there is a “systemic risk” to the financial system—a move that federal officials appeared to take Sunday.

    https://www.forbes.com/sites/marisadellatto/2023/03/12/feds-could-protect-all-silicon-valley-bank-deposits-amid-search-for-buyer-reports-say/

          1. “new facility to provide liquidity to banks under stress”

            Is this what the MMT peops are talking about?

    5. Jooz will be able to access all of their deposits on Monday, the Treasury, Federal Reserve and Federal Deposit Insurance Corporation said in a statement.

    1. Regulators announced Signature Bank, one of the main banks for cryptocurrency companies, was closed Sunday. The New York bank’s depositors will be made whole, officials said.

      Officials took the extraordinary step of designating SVB and Signature Bank as a systemic risk to the financial system, which gives regulators flexibility to guarantee uninsured deposits.

      https://www.wsj.com/articles/federal-reserve-rolls-out-emergency-measures-to-prevent-banking-crisis-ba4d7f98

    1. The Financial Times
      Silicon Valley Bank
      US regulators seek buyer for SVB as government rejects bailout
      FDIC holds auction to buy tech lender as Washington promises policies to stem fallout from its collapse
      Janet Yellen sought to reassure US customers of the failed tech lender but said that reforms since the financial crisis meant SVB would not be bailed out
      Colby Smith in Washington and Arash Massoudi in London 9 hours ago

      The Federal Deposit Insurance Corporation is leading an auction to find a potential buyer for Silicon Valley Bank after the US government said it would help depositors in its efforts to stop contagion across the banking sector.

      Initial bidding closed at 2pm Eastern Time, according to people familiar with the matter, although the deadline could be extended if necessary.

      The search for a buyer comes as Janet Yellen assured US customers of the failed tech lender, which was taken over by the FDIC on Friday, that policies were being discussed to ensure depositors have access to their funds, despite dismissing the idea of a bailout.

      “Let me be clear that, during the financial crisis, there were investors and owners of systemic large banks that were bailed out . . . and the reforms that have been put in place means we are not going to do that again,” Yellen said on Face the Nation. “But we are concerned about depositors, and we’re focused on trying to meet their needs.”

      The FDIC has previously said SVB customers whose accounts were insured will have access to their funds on Monday. However, most of the lender’s customers are uninsured, prompting some this weekend to rush to sell their deposits to pay salaries and other operating expenses. At the end of last year, almost 96 per cent were not covered by the FDIC insurance policy, which guarantees deposits up to $250,000. The FDIC said it would pay uninsured customers an “advance dividend” within the week which would be a percentage of their deposits.

      Yellen’s intervention comes amid calls from investors, entrepreneurs and some lawmakers for the government to step in more forcefully to ensure all depositors are made whole, or risk other banks coming under pressure as customers rush to stash cash in larger institutions.

      “We must make sure all deposits exceeding the FDIC $250K limit are honoured. Banking is about confidence,” Eric Swalwell, a Democratic congressman from California wrote on Twitter. “If depositors lose confidence on the safety of their deposits over 250k then we are in trouble.”

      Mitt Romney, the Republican senator from Utah, said depositors should “recover and have access to their deposits in order to meet their payrolls, pay their suppliers, and to prevent contagion”.

      Andrew Yang, an entrepreneur and former Democratic presidential candidate, warned that “thousands of companies will fold or lay people off next week because of lack of access to accounts through no fault of their own”, imploring the Treasury or the state of California to intervene.

      Billionaire hedge fund investor Bill Ackman issued one of the most urgent calls on Saturday, warning of a run on all but the biggest banks should the government stop short of guaranteeing all of SVB’s deposits or should the lender not be acquired by JPMorgan, Citigroup or Bank of America.
      …

      1. “Billionaire hedge fund investor Bill Ackman issued one of the most urgent calls on Saturday, warning of a run on all but the biggest banks should the government stop short of guaranteeing all of SVB’s deposits or should the lender not be acquired by JPMorgan, Citigroup or Bank of America.”

        It looks a lot like the pre-Lehman Brothers collapse situation at this point, especially the systemic risk scare tactics suggesting SVB is too-big-to-fail.

  43. Will the nonbailout of SVB using no taxpayer monies be enough to save Wall Street? For comparison, following the nonbailout of Lehman Brothers in Fall 2008, US stocks fell around 50% by March 2009.

    But not to worry, as this time the contagion risk is contained.

    1. Markets
      CNBC TV
      Watchlist
      LIVE UPDATES
      Updated Mon, Mar 13 2023 6:46 AM EDT
      Dow futures fall, erasing earlier gains, as traders assess backstop of SVB depositors: Live updates
      Tanaya Macheel

      Futures tied to the Dow Jones Industrial Average fell Monday as traders assessed a plan to backstop all the depositors in failed Silicon Valley Bank and make additional funding available for other banks.

      Dow futures were down 139 points, or 0.4%. They were up more than 4% earlier in the session. S&P 500 futures also erased gains and were last down 0.2%. Nasdaq-100 futures advanced 0.4%.

      Bank stocks were under pressure Monday, with JPMorgan Chase and Citigroup all falling. Regional banks fell even more, led by a 50% drop in First Republic.

      All Silicon Valley Bank depositors will have access to their money starting Monday, according to a joint statement from the Treasury Department, Federal Reserve and the FDIC.

      “Today we are taking decisive actions to protect the U.S. economy by strengthening public confidence in our banking system,” the joint statement said.

      “We went into the weekend as just a very binary event. Either 100% of the uninsured depositors were going to be backstopped, or not,” Peter Boockvar, chief investment officer at Bleakley Financial Group, said Sunday during a CNBC special. “It doesn’t necessarily answer the problem of what happens from here in terms of the economic impact [from] banks that are going to have to raise deposit rates across the board.”

      “Going forward, I’m more worried about bank profitability than bank balance sheets,” he added.

      The Federal Reserve also said it is creating a new Bank Term Funding Program aimed at safeguarding deposits. The facility will offer loans of up to one year to banks, saving associations, credit unions and other institutions.

      Elsewhere, investors are watching various economic reports this week. Tuesday’s consumer price index report is the last major inflation data release ahead of the Fed’s next meeting, ending March 22. February retail sales and the producer price index are also on deck.

      “For the week ahead, it’s going to be about how fear and economics play out,” said Amit Sinha, head of multi-asset design at Voya Investment Management. “If the market feels that SVB is an isolated event, then the fear and contagion driven selling may abate. And if that happens then it’s all back to the Fed and inflation.”

      1 Hour Ago
      Bank stocks fall

      Bank stocks were under pressure in early premarket trading Monday, as worries grew over the health of the U.S. banking system.

      Wells Fargo shares fell 2.1%, while Citigroup lost 1.9%. JPMorgan Chase shares dipped 1%.

      Regional banks took a bigger hit, with the SPDR S&P Regional Banking ETF (KRE) dropping 2.4%. First Republic led the losses with a 50% drop. PacWest Bancorp and Western Alliance also lost 29% and 17%, respectively.
      …
      https://www.cnbc.com/2023/03/12/stock-market-futures-open-to-close-news.html

      1. Crypto soars as bank bailouts remove haircut risk, encourage rate hopes
        Investing.com | Mar 13, 2023 06:19AM ET
        Crypto soars as bank bailouts remove haircut risk, encourage rate hopes
        By Geoffrey Smith

        Investing.com — Cryptocurrencies soared on Monday after federal action to bail out one of the biggest regulated banks providing services to the sector removed a major immediate threat to it.

        The U.S. Treasury, Federal Reserve, and Federal Deposit Insurance Corporation said on Sunday that they would backstop the deposits of both Silicon Valley Bank (NASDAQ:SIVB) and Signature Bank (NASDAQ:SBNY), two institutions that provide essential banking services to some of the crypto space’s biggest players.

        The announcement removed the risk that billions of dollars held by the likes of Coinbase (NASDAQ:COIN) and USD Coin issuer Circle could be lost as part of the authorities’ rescue plans for the banks.

        The crypto universe is ill-placed to absorb any more shocks of that kind, still reeling from the implosion of FTX late last year.
        …
        One of the biggest gainers on Monday was the stablecoin USD Coin, issued by Circle. Circle has $3.3 billion of its reserves on deposit at Silicon Valley Bank, a sum that far exceeds the federally-guaranteed maximum. The risk of it taking a “haircut” on its deposits as part of SVB’s resolution drove USD Coin down as far as 88c on Saturday, but the coin, which is designed to trade at $1 exactly, had recovered to 98.61c by 04:45 ET (09:45 GMT). Another big beneficiary was the stablecoin DAI, which holds most of its reserves in USD Coin. It rose to 98.41.

        More mainstream digital assets benefited not only from the implications of federal action for the security of reserve assets, but also from the impact of the weekend’s events on the outlook for interest rates.

        Several banks, including Goldman Sachs, now assume that the Fed will proceed more gently with any further moves to tighten monetary policy, fearful of doing further damage to the banking system.

        Short-term U.S. interest rate futures rose sharply on Monday morning in Europe, as investors slashed their bets on a rate hike. By 04:45 ET, the market indicated that the most likely outcome of the Fed meeting next week is now no change to the Fed Funds rate. Previously, the consensus had been for a 25 basis points hike, with a sizeable minority betting on a half-point hike after a string of stronger-than-expected economic data since the start of the year.

        Bitcoin was up 8.1% at $22,039, while Ethereum was up 8.0% at $1,575.
        Written By: Investing.com

      2. Yahoo
        U.S. regulators shutter Signature Bank, lender to Paxos, Coinbase, citing systemic risk
        Danny Park
        Sun, March 12, 2023 at 7:17 PM PDT·1 min read

        U.S. regulators closed New York-based Signature Bank, one of the biggest lenders in the crypto industry, due to risks of a systemic bank failure, the U.S. Treasury Department, Federal Reserve, and Federal Deposit Insurance Corporation (FDIC) said in a joint statement.

        Fast facts

        – “All depositors of [Signature Bank] will be made whole. ​​As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer,” the statement said.

        – This follows the closure of Silicon Valley Bank last Friday, which is the largest U.S. bank failure since the collapses of Lehman Brothers and Washington Mutual during the 2008 financial crisis.

        – The FDIC-insured Signature is a major lender to the cryptocurrency sector, with total assets of about US$110 billion and total deposits of over US$88 billion as of the end of last year, according to the New York Department of Financial Services.

        – Cryptocurrency exchange Coinbase tweeted Monday morning in Asia that it had about US$240 million in corporate cash at Signature as of March 10, while noting that the company expects to fully recover those funds.

        – Binance USD (BUSD) stablecoin issuer Paxos said it currently has US$250 million at Signature Bank.
        …
        https://www.yahoo.com/entertainment/u-regulators-shutter-signature-bank-021748714.html

        1. ‘…no losses will be borne by the taxpayer,” the statement said.’

          They say that alot.

          Where do the costs of MMT actually land?

    3. The Financial Times
      Markets Briefing Equities
      European bank stocks tumble as investors fret over SVB fallout
      S&P 500 and Nasdaq set for higher open after Fed announces emergency funding measures
      A montage of the Federal Reserve building and the Fed logo
      The US Federal Reserve announced emergency funding measures to ensure banks could ‘meet the needs of all their depositors’
      Martha Muir in London, Leo Lewis in Tokyo and William Langley in Hong Kong yesterday

      European bank shares tumbled in morning trade on Monday and nervous investors piled into government debt as markets fretted over regulators’ moves to prevent the collapse of Silicon Valley Bank from spreading into the wider economy.

      The region-wide Stoxx 600 was down 2.5 per cent as Credit Suisse fell 10 per cent and Commerzbank lost 12 per cent. Dutch bank ING lost 7.3 per cent. The European Stoxx banking index dropped 6.4 per cent.

      Traders raced into sovereign debt, with the yield on the two-year US Treasury note, which is sensitive to interest rate changes, falling 0.4 percentage points to 4.1 per cent. German 10-year Bunds fell 0.2 percentage points to 2.2 per cent. Yields fall when prices rise.
      …

  44. Does it seem like there is a lot of systemic rot in the bailout-ready US banking sector?

    1. First Republic drops 70%, leads decline in bank stocks despite government’s backstop of SVB
      Published Mon, Mar 13 2023 6:49 AM EDT
      Updated 3 Min Ago
      Jesse Pound
      John Melloy

      Key Points
      – First Republic said Sunday it had received additional liquidity from the Federal Reserve and JPMorgan Chase.
      – The bank said the move raises its unused liquidity to $70 billion, before any funding it could get from the new Fed facility.
      – The Federal Reserve created a new Bank Term Funding Program that will offer loans up to a year to banks in return for high quality collateral like Treasurys.
      …
      https://www.cnbc.com/2023/03/13/first-republic-drops-bank-stocks-decline.html

      1. “…that will offer loans up to a year to banks in return for high quality collateral like Treasurys.”

        Too bad SVB didn’t already have this special facility available, to borrow against its devalued collateral, last week!

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