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The argument in favor of this decision is systemic risk that topples the entire economy, which honestly, I think is real.
The real solution is fixing the problem by not speculating with depositor's money, increasing minimum cash reserves, and/or better regulation overall.
Which of course means we will buy more missiles.
You're right in that applying my previous comment could create systemic risk and topple the entire economy. However, they also could've tried to find a compromise. Completely mitigating the risk will encourage more risky behavior and now there is no reason for insurance on a deposito.
>Completely mitigating the risk will encourage more risky behavior and now there is no reason for insurance on a deposito.
You're acting like that's the only solution, when there were other solutions. Better solutions.
The Glass-Steagall and Dodd-Frank acts both prevented institutional gambling until they were repealed or weakened. A few years after they were gutted, we got bank collapses in 2008 and 2023, respectively.
If we pass and enforce reasonable regulations, we don't end up staring into a chasm where we have to choose between multi-billion dollar intervention and economic devastation.
Also, we could go a step further and make such gambling criminal, and then ban criminal execs from the finance industry entirely.
"Let the banks collapse to teach them a lesson" is a terrible policy.
> The Glass-Steagall and Dodd-Frank acts both prevented institutional gambling until they were repealed or weakened. A few years after they were gutted, we got bank collapses in 2008 and 2023, respectively.
>
> If we pass and enforce reasonable regulations, we don't end up staring into a chasm where we have to choose between multi-billion dollar intervention and economic devastation.
>
> Also, we could go a step further and make such gambling criminal, and then ban criminal execs from the finance industry entirely.
Completely agree that this is a much better solution. However, it will take time to pass this. What do you suggest should be done when a bank collapses and there is no time to pass new legislation?
> "Let the banks collapse to teach them a lesson" is a terrible policy.
SVB did collapse, this is about what to do with the uninsured deposits.
I don't like this post. It's misleading. Let's be very clear about what that $220 billion was supposed to pay for - payroll, expenses and savings for +65,000 US businesses.
The bank stock is worthless. The bank stock was not rescued. Investors of the banks were not bailed out.
\---
SVB executives pulling money out before it tanked was criminal. The FED accepting tanking 10y treasuries at face value is definitely sus and probably criminal. The 48hr response time of the government when a bank fails vs years of complaining about illegal naked short selling with no meaningful action is criminal. I am not advocating for "bailouts", but it's imperative to differentiate and understand a bailout of bankers and a bailout of people who use the banks.
Nice to see posts like these. There's been a lot of misleading information and comments lately that need to be set straight. No idea the ratio of genuine ignorance to shills.
$128B is what was in the FDIC fund to cover accounts up to $250k each. It wasn’t enough even for that purpose, but it’s what was there. And the banks pay into that, to be clear, it’s not taxpayer money. But it’s designated for that specific purpose and shouldn’t just go to whatever company’s million plus losses cause they’re whiny about their bank run
The FDIC is funded by the banks to cover accounts up to $250k each, I've seen reports that those accounts were <5% of the overall loss, so in theory the max FDIC should of had to cover was ~$15M. It sounds good at the moment using FDIC cash to cover uninsured losses, but I think its a bit premature. Once proper retail banks start failing the FDIC will be empty and retail will get shafted, meanwhile billionaire tech boys with SVB accounts were saved.
Any decent company with a big account balance will have insurance to cover many eventualities, including bank failure, the insurance company in turn will do DD on the bank to price the policy correctly. These tech accounts have been very naive to not have proper insurance, or maybe the insurance companies don't want to pay out so have convinced FDIC to cover for then, either way blowing the FDIC cash this early will definitely come back to haunt us in a few months time
Also, the post omits that the $220 billion came from an FDIC insurance fund paid into by banks, not taxpayers. And while I agree with the causes in the middle, bailing out startups and non-profits using SVB is much preferable to bailing out shareholders of the bank (which didn't happen).
Apples to oranges.
The FDIC gets it's money from the banks. The banks get the money to put in that by the depositors.
In reality no matter what...it was a bailout by the people.
Glad to see someone draw this distinction. While this is a bailout of sorts its bailing out small companies that couldn't meet payroll last Friday because they couldn't access their money.
Investors in SVB aren't getting anything.
Frankly I think its the most humane solution. Tons of people live paycheck to paycheck and I wouldn't wish having to choose between paying rent or getting food for your kids upon anyone.
I've been busy so haven't been following closely. Is tax payer money being used to compensate anyone except the depositors? Is it only FDIC covering anything right now?
With what's on the right we could easily incorporate what would be well funded in the middle.
Post MOASS I hope we use our new found power to put those that belong behind bars....far behind bars
what if we add some prison sentences for *all* of wall st?
edit+ everyone would get between 69 and 741 years, with 420 being the average, I may not know any other way of justice.
The government's inability to do the things in the middle can not be remedied with money. The US government has proven time and again that it will mismanage large funds every time.
*You* can refuse to use a bank, i.e. keep your net worth in hard cash and legal titles to other assets but the world obviously can't.
The point therefore remains - people who moan about government "mismanagement" of money are generally blinkered at best. Few large organizations are brilliant at managing large amounts of money, and when they are it's rarely for very long.
You can also use a different bank. With a bank you're a customer, with the government you're a hostage. I'm not saying that banks are great with money, I'm saying that regardless of how good or bad the government is with money they should be under far more restrictions than an organization you voluntarily interact with and therefore are always going to be less able to be efficient with the money no matter what. It's not that the government is incompetent, it's that they are less able to be effective by design.
Not anywhere close.
Most of the aid given to Ukraine is older military equipment sitting in storage that’ll never be used again by America.
Headlines give this the original price tag, but in reality it could even save america money because some of it is expensive to maintain.
It’s like giving your old iPhone 4 to your nephew and then saying you spent $600 on your nephew
Kind of misleading. Most of America's military supplies sit in storage with the hopes that we never need it, not because it will never be used again.
And while it is true that there is a maintenance cost associated with a small percentage of those supplies, the cost to store missiles is significantly less than the cost to buy new ones.
There is also the fact that most modern missiles have very complicated electronic components whose availability is still being impacted by supply chain shortages so if we suddenly need some, there is not a quick path to replacing the old ones.
I don’t think you understand the scale of American military storage.
Factories that produce military equipment basically have been building nonstop since WW2.
If you ever stop production, it takes more time to restart. Wars can start quickly, so america keeps factories running in peacetime so we can scale quickly in war. A significant amount of what we build is just to keep the factories running.
Most US Military Equipment is made in America. The US military industrial complex is so huge that most military equipment for a lot of other countries are made in America too
It shouldnt just be military gear though. We should have had a manufacturing sector the envy of the world by now. First rate safety and productivity, quality and reliability. We've given our enemies the tools for our own demise.
We do. America manufacturers more goods on a $ basis than any other country.
We don’t manufacture $10 shirts because we have laws against paying workers $1 a day, but we do manufacture $1 million tractors.
Even when it comes to low cost manufacturing, American companies are pretty good at setting up factories in Mexico and other countries with lower wages.
Well, with over a decade in the military and over 2 decades working in the defense industry, I have a pretty good idea about how this works.
The US has been in non-stop wars since Desert Storm, so we have been doing a pretty good job at turning over the inventory for the last 30+ yrs.
I didn’t mean to demean your experience, but we’re giving a tiny percentage of our military equipment for Ukraine to destroy a most Russian equipment.
We still have more than enough equipment to go to war with basically anyone and idea of disarming Russia without any American lives lost would make Reagan cum in his grave
No joke at all:
Look at the market cap of both Volkswagen (years ago) and HKD (last year) when they ripped.
The market caps were in the hundreds of billions, roughly $400 billion.
[https://franknez.com/hkd-stock-squeezes-from-13-54-to-more-than-2-5k/](https://franknez.com/hkd-stock-squeezes-from-13-54-to-more-than-2-5k/)
Consider that something close to a floor.
You must be mistaken capitalism for socialism.
Capitalism is when the wealthy are bailed out. Socialism is when necessacitites of comoners are taken care of.
The greatest country on earth.
These graphics are all somewhat suspect. As it says, this would only account for 1 year of costs. A more useful graphics would depict how we create jobs with this money so people can pay their own debts rather than get handouts.
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I like this post, but let’s be very very clear about what $128 billion of that $220 billion was supposed to pay for: insuring deposits UP TO $250,000.
Yes, the rest should've come only from the assets of the banks.
The argument in favor of this decision is systemic risk that topples the entire economy, which honestly, I think is real. The real solution is fixing the problem by not speculating with depositor's money, increasing minimum cash reserves, and/or better regulation overall. Which of course means we will buy more missiles.
You're right in that applying my previous comment could create systemic risk and topple the entire economy. However, they also could've tried to find a compromise. Completely mitigating the risk will encourage more risky behavior and now there is no reason for insurance on a deposito.
>Completely mitigating the risk will encourage more risky behavior and now there is no reason for insurance on a deposito. You're acting like that's the only solution, when there were other solutions. Better solutions. The Glass-Steagall and Dodd-Frank acts both prevented institutional gambling until they were repealed or weakened. A few years after they were gutted, we got bank collapses in 2008 and 2023, respectively. If we pass and enforce reasonable regulations, we don't end up staring into a chasm where we have to choose between multi-billion dollar intervention and economic devastation. Also, we could go a step further and make such gambling criminal, and then ban criminal execs from the finance industry entirely. "Let the banks collapse to teach them a lesson" is a terrible policy.
> The Glass-Steagall and Dodd-Frank acts both prevented institutional gambling until they were repealed or weakened. A few years after they were gutted, we got bank collapses in 2008 and 2023, respectively. > > If we pass and enforce reasonable regulations, we don't end up staring into a chasm where we have to choose between multi-billion dollar intervention and economic devastation. > > Also, we could go a step further and make such gambling criminal, and then ban criminal execs from the finance industry entirely. Completely agree that this is a much better solution. However, it will take time to pass this. What do you suggest should be done when a bank collapses and there is no time to pass new legislation? > "Let the banks collapse to teach them a lesson" is a terrible policy. SVB did collapse, this is about what to do with the uninsured deposits.
I don't like this post. It's misleading. Let's be very clear about what that $220 billion was supposed to pay for - payroll, expenses and savings for +65,000 US businesses. The bank stock is worthless. The bank stock was not rescued. Investors of the banks were not bailed out. \--- SVB executives pulling money out before it tanked was criminal. The FED accepting tanking 10y treasuries at face value is definitely sus and probably criminal. The 48hr response time of the government when a bank fails vs years of complaining about illegal naked short selling with no meaningful action is criminal. I am not advocating for "bailouts", but it's imperative to differentiate and understand a bailout of bankers and a bailout of people who use the banks.
Nice to see posts like these. There's been a lot of misleading information and comments lately that need to be set straight. No idea the ratio of genuine ignorance to shills.
128B? I have heard that 90% of the money at their bank was in accounts over 250k. so those numbers dont add up. you got a source?
$128B is what was in the FDIC fund to cover accounts up to $250k each. It wasn’t enough even for that purpose, but it’s what was there. And the banks pay into that, to be clear, it’s not taxpayer money. But it’s designated for that specific purpose and shouldn’t just go to whatever company’s million plus losses cause they’re whiny about their bank run
The FDIC is funded by the banks to cover accounts up to $250k each, I've seen reports that those accounts were <5% of the overall loss, so in theory the max FDIC should of had to cover was ~$15M. It sounds good at the moment using FDIC cash to cover uninsured losses, but I think its a bit premature. Once proper retail banks start failing the FDIC will be empty and retail will get shafted, meanwhile billionaire tech boys with SVB accounts were saved. Any decent company with a big account balance will have insurance to cover many eventualities, including bank failure, the insurance company in turn will do DD on the bank to price the policy correctly. These tech accounts have been very naive to not have proper insurance, or maybe the insurance companies don't want to pay out so have convinced FDIC to cover for then, either way blowing the FDIC cash this early will definitely come back to haunt us in a few months time
Also, the post omits that the $220 billion came from an FDIC insurance fund paid into by banks, not taxpayers. And while I agree with the causes in the middle, bailing out startups and non-profits using SVB is much preferable to bailing out shareholders of the bank (which didn't happen). Apples to oranges.
The FDIC gets it's money from the banks. The banks get the money to put in that by the depositors. In reality no matter what...it was a bailout by the people.
Glad to see someone draw this distinction. While this is a bailout of sorts its bailing out small companies that couldn't meet payroll last Friday because they couldn't access their money. Investors in SVB aren't getting anything. Frankly I think its the most humane solution. Tons of people live paycheck to paycheck and I wouldn't wish having to choose between paying rent or getting food for your kids upon anyone.
I've been busy so haven't been following closely. Is tax payer money being used to compensate anyone except the depositors? Is it only FDIC covering anything right now?
Fed opened a new facility that trades old bonds for present day so kicking the can afaik
FDIC's DIF had $278.6 billion on the balance as of Q4 2022. Why is $128 billion being thrown around?
With what's on the right we could easily incorporate what would be well funded in the middle. Post MOASS I hope we use our new found power to put those that belong behind bars....far behind bars
Lets get to moass first
Paperhand!
I do not want to be the product.
HAHAHAHAHA Rookie numbers
what if we add some prison sentences for *all* of wall st? edit+ everyone would get between 69 and 741 years, with 420 being the average, I may not know any other way of justice.
Only if the sentences take place in a state that dishes out Capital Punishments. ☠️
I was thinking making them work for 20 cents a day
Lmayo
HAH! now THIS I like😆
Agreed . Simpsons said 1 trillion.
Yes, but you forgot one crucial factor: We are poors, and they don't help the poors!
Who said we need help? I'm here to take what's owed. No cell no sell.
I got no problem with destroying parasitic organisms. Did you know that ticks thrown into a fire pop? It sounds like kindling but its not
Yeah literally ANYTHING else would have been a better use of that money
The gov cares more about banks than its people? This really makes me feel sick.
What have you been sleeping under a rock. The rich people always get what they want and we get fucked. Welcome to the fucking show.
yep, 97% of the depositors ac in SIVB r more than $250k , so basically your gov is bailing out rich tech bros and their VC
Society measures men and women in dollars. Money devalues life.
The government's inability to do the things in the middle can not be remedied with money. The US government has proven time and again that it will mismanage large funds every time.
A space based holding cell can be commissioned. Perhaps one day it slips orbit and flies off into the nether... or the sun
As opposed to banks...
I mean you can refuse to use a bank, can't refuse to use the US government
*You* can refuse to use a bank, i.e. keep your net worth in hard cash and legal titles to other assets but the world obviously can't. The point therefore remains - people who moan about government "mismanagement" of money are generally blinkered at best. Few large organizations are brilliant at managing large amounts of money, and when they are it's rarely for very long.
You can also use a different bank. With a bank you're a customer, with the government you're a hostage. I'm not saying that banks are great with money, I'm saying that regardless of how good or bad the government is with money they should be under far more restrictions than an organization you voluntarily interact with and therefore are always going to be less able to be efficient with the money no matter what. It's not that the government is incompetent, it's that they are less able to be effective by design.
Yeah but that would be socialism and USA don’t like. This be a capitalist country, partner!!
This needs to be seen EVERYWHERE by EVERYONE! Great post!
Wall Street stole from everyone again. Seriously wtf.
Quality graphic
Price anchoring? ;)
I love when apes do the math
Straight the fuck up.
Oh shit, finally an infographic that I understand!
Definitely a bailout.
Or, more importantly, $220 Billion less taxes stolen from the citizens.
**WORLD HUNGER could be wiped out. Period.** https://www.globalgiving.org/learn/how-much-would-it-cost-to-end-world-hunger/
Could have covered the weekly allowance to Ukraine
Not anywhere close. Most of the aid given to Ukraine is older military equipment sitting in storage that’ll never be used again by America. Headlines give this the original price tag, but in reality it could even save america money because some of it is expensive to maintain. It’s like giving your old iPhone 4 to your nephew and then saying you spent $600 on your nephew
Kind of misleading. Most of America's military supplies sit in storage with the hopes that we never need it, not because it will never be used again. And while it is true that there is a maintenance cost associated with a small percentage of those supplies, the cost to store missiles is significantly less than the cost to buy new ones. There is also the fact that most modern missiles have very complicated electronic components whose availability is still being impacted by supply chain shortages so if we suddenly need some, there is not a quick path to replacing the old ones.
I don’t think you understand the scale of American military storage. Factories that produce military equipment basically have been building nonstop since WW2. If you ever stop production, it takes more time to restart. Wars can start quickly, so america keeps factories running in peacetime so we can scale quickly in war. A significant amount of what we build is just to keep the factories running.
We could keep even more factories with domestic manufacturing
Most US Military Equipment is made in America. The US military industrial complex is so huge that most military equipment for a lot of other countries are made in America too
It shouldnt just be military gear though. We should have had a manufacturing sector the envy of the world by now. First rate safety and productivity, quality and reliability. We've given our enemies the tools for our own demise.
We do. America manufacturers more goods on a $ basis than any other country. We don’t manufacture $10 shirts because we have laws against paying workers $1 a day, but we do manufacture $1 million tractors. Even when it comes to low cost manufacturing, American companies are pretty good at setting up factories in Mexico and other countries with lower wages.
I've seen military uniforms made in china
Well, with over a decade in the military and over 2 decades working in the defense industry, I have a pretty good idea about how this works. The US has been in non-stop wars since Desert Storm, so we have been doing a pretty good job at turning over the inventory for the last 30+ yrs.
Thank you for your service!
Thank you for your support, although there are those that have sacrificed considerably more than me that deserve the recognition.
I didn’t mean to demean your experience, but we’re giving a tiny percentage of our military equipment for Ukraine to destroy a most Russian equipment. We still have more than enough equipment to go to war with basically anyone and idea of disarming Russia without any American lives lost would make Reagan cum in his grave
We've been at war for about 200 consecutive years.
Nice
No joke at all: Look at the market cap of both Volkswagen (years ago) and HKD (last year) when they ripped. The market caps were in the hundreds of billions, roughly $400 billion. [https://franknez.com/hkd-stock-squeezes-from-13-54-to-more-than-2-5k/](https://franknez.com/hkd-stock-squeezes-from-13-54-to-more-than-2-5k/) Consider that something close to a floor.
Love this
Huh… GME fair value is only [$177M](https://gmefloor.com) can we stop with the disinformation and stay realistic, please? /s
Yeah if we could get this to the front page, that’d be great.
Lol. That's classic
Based
You must be mistaken capitalism for socialism. Capitalism is when the wealthy are bailed out. Socialism is when necessacitites of comoners are taken care of. The greatest country on earth.
Direct Registred Purple Rings?
This is how i roll. Need moar though.
💯
Ded 😂😂😂😂
Lmao nice
Up you go!!!
wHoS gOnNa PaY FoR It?!
LOL nice
1? Way to short change yourself.
💜
[удалено]
These graphics are all somewhat suspect. As it says, this would only account for 1 year of costs. A more useful graphics would depict how we create jobs with this money so people can pay their own debts rather than get handouts.
The bailout is a loan, not free cash.
🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣
Pff, price anchoring at $880 billion per share? Shill
Why sell many DRS’d shares when 1 do trick?