Silicon Valley Bank is Dead

Discussion in 'The Mainboard' started by Menelaus, Mar 10, 2023.

  1. BP

    BP Bout to Regulate.
    Donor
    Atlanta BravesGeorgia BulldogsAtlanta Falcons

    Libertarians are so predictable.
     
    CaneKnight, Iron Mickey and Lyrtch like this.
  2. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Shady Bank investments into Mortgage Backed Securities?
     
  3. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    wait so you're saying the bank that failed managed its risk properly?
     
    CaneKnight and BudKilmer like this.
  4. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    You're assuming a lot here. It's more that people move or need cash so they have to refi. I don't think you understand the average consumer in the US. Rates won't stay this high forever. They'll be back in the 4/5 range shortly and people won't blink at ditching 3.5% to take 4.75% bc they need $50k for a new kitchen and to pay off some cc's. You're really getting our of your lane on this one.
     
    Jax Teller and Ty Webb like this.
  5. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Yes, I literally said that on page 1 on one of my first posts on the subject.

    IDK if that is "shady" like others are claiming comparing them to SBF
     
  6. pperc

    pperc Well-Known Member
    Donor

    these companies didn't make shady bank investments. they banked with a giant bank. like many do.
     
    Keef and DriveByBBQ like this.
  7. pperc

    pperc Well-Known Member
    Donor

    you are so confused. let's stop.
     
  8. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Hope so, WED need's a second mortgage for a vacation home
     
  9. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    we should just make public banking in this case, which i do fully support
     
  10. pperc

    pperc Well-Known Member
    Donor

    if rates came down, this wouldn't have happened to SVB. they needed those MBSs to not be so far under water and long term in the current environment. that's why they took a $3.5B loss on them. they didn't see things changing on them soon.
     
    Bar None likes this.
  11. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    got it
     
    pperc likes this.
  12. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Can we all just blame the Fed? They are the ones at fault, ironically enough
     
    Tug, Keef, Prospector and 2 others like this.
  13. BP

    BP Bout to Regulate.
    Donor
    Atlanta BravesGeorgia BulldogsAtlanta Falcons

  14. ScFan27

    ScFan27 Well-Known Member
    South Carolina GamecocksNew York YankeesNew York JetsNew York Rangers


    They probably paid Forbes for this just like the 40 under 40 people do.
     
  15. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    That's fine. That's really not relevant to the idea of people keeping mortgages for 30 years though. Maybe the average length goes from 7 to 9/10 years but lol at it ever getting to "most people are holding onto that 30 year fixed at 2.75% for all 30 years." That's really all I cared to point out.
     
    VaxRule likes this.
  16. Hogview

    Hogview Fan of the Green board, Razorbacks
    Donor TMB OG
    Arkansas RazorbacksTiger WoodsPGA

    I would love to see where you're getting this information at. Please share
     
  17. pperc

    pperc Well-Known Member
    Donor

    yeah, i know. it was hyperbole and you're right
     
    You likes this.
  18. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    Which part?
     
  19. Dale Doback

    Dale Doback Well-Known Member
    Donor

    I dont know that this is true. I think their would be have to be more to it to pierce the veil
     
  20. Hogview

    Hogview Fan of the Green board, Razorbacks
    Donor TMB OG
    Arkansas RazorbacksTiger WoodsPGA

    Where the majority of 30 years are paid out in 7
     
  21. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    I'm a loan officer so that was something we got in training at some point. I said earlier that was a few years ago. Here's a recent article saying it's "under 10" but not a specific number. To be clear, they aren't paid off as in paid in full, they are just refi'd or someone moves. That specific mortgage lasts less than 10 years.

    https://www.rocketmortgage.com/lear...0-year mortgage gives,loan off in record time.

    Most people with this type of mortgage won’t keep the original loan for 30 years. In fact, the typical mortgage length, or average lifespan of a mortgage, is under 10 years. That’s not because these borrowers pay the loan off in record time
     
  22. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

  23. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    Here's another putting it at 8.

    https://www.sofi.com/learn/content/average-mortgage-term-length/

    The average length of a mortgage is 30 years, but that’s not the amount of time that most borrowers will keep the loan. Homeowners only stay in a home for eight years on average, and many refinance their home loans.
     
    You likes this.
  24. Hogview

    Hogview Fan of the Green board, Razorbacks
    Donor TMB OG
    Arkansas RazorbacksTiger WoodsPGA

    Ah, I see what you're saying now, still hazy in the cockpit this afternoon.
     
    Jax Teller, You and dblplay1212 like this.
  25. dblplay1212

    dblplay1212 Well-Known Member
    Donor TMB OG
    Alabama Crimson TideNew York YankeesJacksonville Jaguars2pacSneakersFormula 1

    haha I can see where the confusion came from. Yea just saying the average 30 year mortgage lasts 7-8 years before the person moves or refi's and that mortgage is over.
     
    Jax Teller, You and Hogview like this.
  26. One Two

    One Two Hot Dog Vibes
    Donor
    Auburn TigersAtlanta Braves

    SVB should’ve been scanning beers as bananas and this could’ve been avoided
     
    broken internet, BWC, Taffy and 45 others like this.
  27. BudKilmer

    BudKilmer Well-Known Member
    Donor TMB OG
    Atlanta HawksAtlanta FalconsAvengers

    I don’t know what your reputation is in this town but you can bet after the stunt you pulled today I’ll be looking into it

    4461B0D5-4E14-47D3-A25E-9F71CBA73737.jpeg
     
  28. afb

    afb Spoiler Alert: Pawnee, IN may not be on a map.
    Donor
    Florida State SeminolesBig Ten Conference

    how about a compromise where we only bailout the payroll parts
     
    Prospector and pperc like this.
  29. pperc

    pperc Well-Known Member
    Donor

    not good amongst the anti-vax crowd
     
    Keef likes this.
  30. pperc

    pperc Well-Known Member
    Donor

    short term liquidity i hear is coming anyways by way of an FDIC advanced dividend prior to liquidation. other outcome is a big bank buys them likely at a discount and provides that liquidity in the short term. bond holders are going to take losses first. question is how deep the discount would be.
     
  31. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor


     
    #132 Lyrtch, Mar 10, 2023
    Last edited: Mar 10, 2023
  32. Name P. Redacted

    Name P. Redacted I have no money and I'm also gay
    Donor
    Kansas State WildcatsSeattle Kraken

    Maybe those companies should have split up their single account into many so they were all insured deposits. Please make me CFO.
     
  33. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    due diligence, personal responsibility, fiscally sound *shakes hands*

    MORAL HAZARD
     
    broken internet, Taffy, Tug and 13 others like this.
  34. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    IDK why ppl are conflating the ones depositing money in the bank having their money secured with the investors running the bank being bailed out
     
  35. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    That's actually a program available to a lot of high net worth individuals and companies.
     
    letan and One Two like this.
  36. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    You can also do it yourself
     
  37. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    Do you think all bank accounts balances above 250k should be guaranteed even if asset sales don't cover.
     
  38. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    This is stupid, TBQH
     
  39. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Potentially. Yes. Maybe not someone with hypothetically a billion in a checking account...but a portion. Yes.

    And I can also agree for bailouts on student loans and other things
     
  40. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    how so, I think normal people should leverage the FDIC insurance rules to their advantage as much as people with 250k+ piles of cash is an outlier for "normals"
     
    Tug and CaneKnight like this.
  41. herb.burdette

    herb.burdette Meet me at the corner of 8th and Worthington
    Donor
    Ohio State Buckeyes

    I didn’t expect to open this thread and find Lyrtch advocating 1920’s style laissez faire banking concepts, but here we are.
     
  42. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    It's stupid to do it yourself vs just having an institution do it for you when they have the platform and everything fully set up.
     
  43. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    i'm trying to see if our tech/finance bros have consistency in their beliefs on down. something Larry doesn't but some people decided defend.
    i'm talking like leveraging joint accts dbl'ing FDIC insurance to combine to 750k coverage just with one bank. that's a lot of cash.

    easy things that will encompass 99% of people
     
    Tug and CaneKnight like this.
  44. Where Eagles Dare

    Where Eagles Dare The Specialist Show On Earth
    Donor
    Auburn TigersAtlanta BravesWashington Football TeamAtlanta United

    Sure, it'll cover 99% of ppl but isn't going to cover 99% of people that would like to get paid over the next month bc the bank their company had a checking account with was mismanaged.

    That's vastly out of control of 99.99% of all workers and such an extreme rare risk that I'd guess a lot of companies don't do it. This bank was stable 60 days ago.
     
  45. angus

    angus Well-Known Member
    Donor

    This thread has the whole stew boiling.
     
  46. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

    we should add a rule that companies carry what, 30 days of payroll? on their books when they have >20 employees or 1mill in gross revenue?
     
  47. herb.burdette

    herb.burdette Meet me at the corner of 8th and Worthington
    Donor
    Ohio State Buckeyes

    I’m not sure we find out, in hindsight, it was stable. This seems to be a big failure on the part of banking regulators as well.
     
  48. Lyrtch

    Lyrtch My second favorite meat is hamburger
    Staff Donor

  49. ~ taylor ~

    ~ taylor ~ Well-Known Member
    Donor TMB OG

    Interesting from some banking attorneys at my firm:

    Deposit accounts, to the extent not insured, will get certificates that will be the first priority in any liquidation, so they'll get paid their deposit before any regular creditors get paid. And everyone gets paid before shareholders.

    Also, they believe that a buyer is already in place.