Posted on 03/10/2023 4:59:07 AM PST by Kaiser8408a
While waiting on the February jobs report from the US Bureau of Labor Statistics (BLS), I noticed that the big 4 banks (Bank of America, JPMorgan Chase, Citi and Wells Fargo) are drowning in net realized losses as The Federal Reserve combats 1) too many years of loose monetary policy under former Fed Chair Janet Yellen and 2) too much spending under Pelosi, Schumer and … McConnell.
At a micro level, we have Silicon Valley Bank (SVB) SVB Is racing to prevent a bank run as funds advise pulling cash.
Panic is spreading across the financial world as concerns about the financial stability of Silicon Valley Bank prompt prominent venture capitalists including Peter Thiel’s Founders Fund to advise startups to withdraw their money.
The turmoil followed a surprise announcement from Santa Clara, California-based SVB that it was issuing $2.25 billion of shares to bolster its capital position after a significant loss on its investment portfolio. The stock plunged 44% in premarket trading before exchanges opened in New York on Friday, set to extend its 60% decline on Thursday. Bonds had posted record declines, igniting a broad selloff in US bank shares that also spread to Asia and Europe. In the US, the KBW Bank Index on Thursday had its worst day since June 2020, as its members shed more than $90 billion of value. In Europe, the biggest banks lost more than $40 billion from their market caps on Friday.
Are banks the canary in the economic coal mine?
(Excerpt) Read more at confoundedinterest.net ...
From the chart published, it looks like BofA is in the worst shape of the big 4 banks and its not even close.
That certainly wouldn’t break my heart. BofA has been thoroughly infected with Wokeism, pushing ESG, the Gun Grabber agenda and various other Leftist causes. I closed my account with them a few years ago because of it.
California-based SVB that it was issuing $2.25 billion of shares to bolster its capital.
Something to keep with your Edsel stocks.
Prepare for a bail in. The bank skims your account for 15%-30% to stay afloat.
The ONLY time investment grade bonds and US Treasury debt decline in value is if interest rates are rising and the bank needs to sell the bond BEFORE it matures.
Remember - when interest rates go up, the TEMPORARY value of a bond - before maturity - goes down.
Unless a bank has a sudden and desperate need for cash, there is no reason to sell bonds before they mature back to their full cash value.
would this have anything to do with the IRA’s raising the time to start required minimum distributions being modified to the age of 73?
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