* Wall Street's main stock indexes dropped on Wednesday on fresh fears
* Worries related to Credit Suisse spurred fears of further banking crisis
* The Big Four trillion-dollar US banks bled away yesterday's gains in early trading Plunging bank stocks drove
Wall Street's main stock indexes lower on Wednesday, as turmoil at Credit Suisse renewed fears of a banking crisis and BlackRock CEO Larry Fink warned 'more shutdowns are coming' after the collapse of Silicon Valley Bank.
S&P 500 Banks Industry Group Index dropped more than 4 percent in morning trading, and the Dow Jones Industrial Average fell more than 450 points, or 1.42 percent.
Shares of First Republic, one of the regional banks swept up in contagion fears after the collapse of Silicon Valley Bank, dropped up to 17 percent after the bank's bond rating was downgraded to Junk status by Standard & Poors.
Read more ....
WNU editor: Not a good day for US stocks .... Wall Street tumbles as Credit Suisse sparks fresh bank selloff (Reuters).
11 comments:
Market capitalization of Credit Suisse (CS) Market cap: $10.06 Billion As of March 2023 Credit Suisse has a market cap of $10.06 Billion .
This is below the 50 billion Dodd Frank threshold.
10.06 < 50
So no stress test for Credit Suisse.
Let's face it. This is the Dr. Fauci Recession.
- Dr Fauci "I am the Science"
- Daszak, the middle man, gets Fauci Money and gives it to Wuhan.
(But it gets better. GAO thinks we were double billed!)
- Wuhan conducts Gain of Function research/
- Lab leak
- COVID epidemic
- Not wanting to let a crisis go to waste, Democrats DEMAND lockdowns and 2 to 4 trillion in spending
- Inflation results
- Fed steps into control inflation and raises rates.
- Raising rates makes previous bond investments worthless.
- Banking Crisis
- Recession
- Global Nuclear War
- Demoncrats "Let's rinse and repeat. That was fun!"
Who dumped the banking guardrails? Tump! now stop being silly and do a search. It was Trump that dumped the Dodd-Frank safeguards
President Donald Trump signed the biggest rollback of bank regulations since the global financial crisis into law Thursday.
The measure designed to ease rules on all but the largest banks passed both chambers of Congress with bipartisan support. Backers say the legislation will lift burdens unnecessarily put on small and medium-sized lenders by the Dodd-Frank financial reform act and boost economic growth.
Opponents, however, have argued the changes could open taxpayers to more liability if the financial system collapses or increase the chances of discrimination in mortgage lending.
10.06 < 50
2:55
1) Never learned the number line
- Missed 1st grade
2) Does not comprehend the concept of a threshold.
3) Is not on speaking terms with The Truth
4) Does know what a number line and an inequality are, but it is a crap shoot ,if they can get it right.
2:55 PM
Name the exact regulation the SVB broke. BTW there were no bank failures under Trump.
Nice try. Keep chucking ;)
Journalist Aaron Rupar pointed out the falseness of Donald Trump Jr's statement, tweeting: "There were actually 16 bank failures between 2017 and 2020. SVB Bank is the first to collapse since Biden took office." He sourced data from the Federal Deposit Insurance Corporation (FDIC), which reports that eight banks failed in 2017, four in 2019 and four in 2020.
The eight banks that failed in 2017 were: the Washington Federal Bank for Savings, Chicago, Illinois; The Farmers and Merchants State Bank of Argonia, Argonia, Kansas; Fayette County Bank, Saint Elmo, Illinois; Guaranty Bank, Milwaukee, Wisconsin; First NBC Bank, New Orleans, Louisiana; Proficio Bank, Cottonwood Heights, Utah; Seaway Bank and Trust Company, Chicago, Illinois; and Harvest Community Bank, Pennsville, New Jersey.
In 2019, the four banks that collapsed were: City National Bank of New Jersey, Newark, New Jersey; Resolute Bank, Maumee, Ohio; Louisa Community Bank, Louisa, Kentucky; and the Enloe State Bank, Cooper, Texas.
The quartet of banks that failed in 2020 were: Almena State Bank, Almena, Kansas; First City Bank of Florida, Fort Walton Beach, Florida; The First State Bank, Barboursville, West Virginia; and Ericson State Bank, Ericson, Nebraska.
One of the culprits he blamed was the rollback of the Dodd-Frank banking regulations that were Washington’s response to the 2008 financial crisis:
“Unfortunately, the last administration rolled back some of these requirements — I’m going to ask Congress and the banking regulators to strengthen the rules for banks, to make it less likely this kind of bank failure would happen again,” Biden said.
What did those rollbacks look like and why do they matter now?
The original Dodd-Frank law said that once a bank became bigger than $50 billion in assets, it would be subject to additional rules and oversight. Then came 2018 and the Economic Growth, Regulatory Relief, and Consumer Protection Act — aka the Dodd-Frank rollback.
“In 2018, the law said, ‘Oh, now that only applies to banks with more than $250 billion in assets.’ And it turns out Silicon Valley Bank at the time — and actually even last week — fell under that threshold,” said Erin Lockwood, who teaches political science at University of California, Irvine.
That’s despite the fact that it was the 16th largest bank in the country.
“Before the law was passed, banks the size of Silicon Valley Bank would have been required to have more stress tests more frequently,” said Dennis Kelleher, CEO of Better Markets, which lobbied against the rollback.
Banks like SVB also would have crucially had to maintain more liquidity. You know, to help out in case of a bank run.
Bank fails are a normal run of business. Your list would be valid if the value of all those banks equaled even a small percentage of the value of SVB. Let's take a look back, shall we?
https://www.newsweek.com/bank-failures-under-donald-trump-compared-joe-biden-1787261
The number of bank failures has dropped to relatively normal levels after spiking in the years of the financial crisis. In 2008, 25 banks collapsed in the U.S. In 2009, they were 140 and in 2010, 157. The number of bank failures gradually dropped from 92 in 2011, to 51 in 2012, 24 in 2013, 18 in 2014 and eight in 2015.
The collapse of SVB last Friday followed a run on the bank by customers spooked by the bank's liquidation of some of its assets. It used these to pay for depositors withdrawing some of their money following the tech sector's crisis. The SVB failure is the biggest after the 2008 financial crisis.
The bank's collapse has been widely attributed to a series of ill-fated investments. These include putting money into some mortgage-backed securities that suffered from the Federal Reserve's decision to hike interest rates in 2022.
SVB had about 2/3rds of their deposits in bonds. Once they did that the die was cast.
SVB could have sold some or all of their bonds to others once the Fed announced rates would go up. they would have sold them at a discount (below par) and would have lost money sooner and can bankrupt sooner. Meaning for those of you, who are benighted and live in the Acela Corridor, once they bought the bonds, they were fucked. They were fucked by the Democrats. But now that Biden is bailing them out they have lube. But the tax payers are not getting any.
Bonds, Selling Before Maturity
"Investors who hold a bond to maturity (when it becomes due) get back the face value or "par value" of the bond. But investors who sell a bond before it matures may get a far different amount. For example, if interest rates have risen since the bond was purchased, the bondholder may have to sell at a discount—below par. But if interest rates have fallen, the bondholder may be able to sell at a premium above par."
Who would perform the stress test other than the Risk Officer? They gapped that billet. I suppose other could. They could also screw up the stress test. They could determine that interest rate would not rise that much and so the bond investment were still winners. 4:29, whos is congenital idiot, does not know.
"Your list would be valid if the value of all those banks"
Order of magnitudes means nothing to that illiterate person. You could have a better conversation with a dog or cat than that person.
Modern Monetary Theory. From the people whose daughters won't let their dads help with running daughter's lemonade stand. Assuming, of course, here in the land of liberty, the daughter can have a lemonade stand nowadays.
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