*this is not investment advice, intelligent, and don’t hold me accountable*
i sit here on pi day (apple is the best) and eating some grocery store sushi, a few days ago the world decided to come after the banks because some irresponsible tech leaders, (Mr. Dropout of College) created some panic with their spoon fed founders. The only person dumber than Peter “Dropout” Thiel is the person from Silicon Valley Bank who thought it would be smart to announce the $1.8 billion loss on their bond portfolio BEFORE announcing the capital raise. The only people that panic more than bankers, are those that are in tech (& yes i do, i spent time at a fintech and tech culture is wack) so of course this resulted in the run. This is definitely not isolated on banks, but this is the biggest one we have.
& why i dont think it is over? The Fed decided to raise interest rates pretty quick and these banks “flushhhhed with cash” -Jean Ralphio voice they decided to take some safe bets on the T-bills, MBS, and low risk products and HERE WE ARE. I can get more money from my high yield savings than my income property loan (3.75% vs 3.50%) and my money isn’t even tied up. So sorry for those with all that duration risk *cough cough* SVB. Do we really think that SVB was the only one getting 1.5% on some 3-year notes?? No chance, there have to be some greedy CEOs out there that did similar things and are so scared to mark to market. So there will be some more banks to go down, but if they’re public, read the 10-K because it actually tells you exactly what you’re always looking for.
Wendall World 