Biden on Brink of 2nd US Bank Bailout

[Gyfts]

USD won't collapse because what happened with the banking system isn't an inherent flaw with USD, it's an inherent flaw with the federal reserve and government policy.

SVB had hundreds of billions in cash they needed to put into something that they thought would've been safe. U.S. treasuries is where they put their money and at the time it didn't seem like a bad idea when the market was so unpredictable back in 2021-2022. With Jerome Powell openly proclaiming inflation to being a large problem, one could reasonably foresee interest rates rising and those U.S. treasury bonds suddenly don't look like a safe/attractive investment anymore. SVB made the wrong bet.

Treasury Secretary Janet Yellen says U.S. government won't bail out Silicon Valley Bank

The government will credit depositors up to 250k so in a way the banks are being bailed out. If the penalty for a bank mismanaging funds is having all your depositors credited then whatever investments that bank is making will all be covered in the event things go bad.

The shareholders and upper management are all out of their cash which have greater economic concerns but it's not as if the federal government is not stepping in to a significant degree. Presumably the unsecured creditors are all out of their cash but I have some doubts the federal government won't step in and make them whole again.

Keep in mind, the reason the financial institutions were issuing out sub prime mortgages was because they had this same guarantee back in 08. If the sub prime mortgages turned out to fail, the government would guarantee them financial remedy. This isn't the same situation but with this system you might as well just have the government manage investments instead of having the banks do it and insure depositors when things go sideways. I would never advocate either system but banks are just acting as the middle man here.

[Carlton Banks]

but why

that's a rational question

anyone who lost their money can and will behave as irrationally as they please, and anyone in media/politics/banking who feels like it will take advantage of the situation, and instigate a "pile on"

[cabron]

but why

that's a rational question

anyone who lost their money can and will behave as irrationally as they please, and anyone in media/politics/banking who feels like it will take advantage of the situation, and instigate a "pile on"

Thats true. With motive, it's possible. Anyone with more than $250K on its account will be really pissed.
It's easy to install hate and even spark a war in a community that lost money against those who gained money. Same for a hungry country to another neighboring country that is wealthy. Printing more USD means inflation rising higher than what it is now. People will no longer be able to afford necessities.

[justdimin]

The title sounds all too familiar, doesnt it? We are seeing this in real time and its pretty wild! This is one of the main reasons that Bitcoin was created, to create an alternative to the fiat trash money. Tomorrow morning President Biden will speak on the 2 bank collapses that happed in the past week, and of course he is going to follow in Janet Yellens footsteps assuring that the US Government will bail the failed banks out and that all the depositors money is safe, but with what money? The printers are running nonstop, they have to be. The US defaulted on their debt recently, I mean all the conditions are not looking great for USD.

Are we seeing the beginning of the domino affect on US AND ALL GLOBAL BANKS?! Is the USD going to finally collapse? I don't think just yet, the FED is going to pull some strings to delay yet again but how much longer can they hold up the inevitable?

I don't get why people are overreacting this much. Banks were in trouble after offering this much, if Biden wants to save them so badly, just drop the interest rate a lot, and by that I mean like under 3% levels, which would be more than enough. That would cause a lot of people to withdraw their money and banks wouldn't normally want that, but right now there are excess amount of money in the banks that they  can't pay back with interest, so people withdrawing their money and not requesting that much in return is actually better.

By this logic if banks want more money, they can offer 100% interest, would everyone jump on it if it was legit? Sure, but how could a bank pay that back? They can't. That is happening right now in a minor scale.

[Lucius]

but why

that's a rational question

anyone who lost their money can and will behave as irrationally as they please, and anyone in media/politics/banking who feels like it will take advantage of the situation, and instigate a "pile on"

I was hoping they wouldn't go in that direction again, but it seems Bitcoin is to blame for everything bad that happened from 2009 to now. Geniuses from the IMF have already spoken.

There is a long list of POTUS they need to call out starting from Clinton and Nixon or at the very least from Bush who single handedly gave a dumb order that is the reason why US wasted $10 trillion (a little less than a third of US current national debt) over the past 20 years.

This is true, which is only proof that the people at the top change, but the policy remains largely the same. They all seem to think that they can create debt forever, because someone else is going to pay for it anyway. $10 trillion less or more is irrelevant to them, because how many people in the US or anywhere in the world can even explain that number, let alone understand how much debt they actually have on their backs.

[Mauser]

Silver and Gold are being purchased like crazy, and people are buying more Bitcoin too the price is going up as we speak. What an insane week for the markets. Surely BTC has a chance for a huge upswing. I mean honestly this is looking very BULLISH for BTC, is it not?

It's great news that the bitcoin market is going up again. Any negative news in the financial sector that leads to higher crypto demand is good in my opinion. The question is now if this is only a short term effect or a more long term trends. It was just a matter of time for the high inflation to lead to higher interest rates, which in return makes loans more expensive. Both of the insolvent banks were focusing on the high yield market where is a lot of more risk involved. They were trying to get higher returns by giving money to start ups. Its good that Biden is not going to bail out the banks. Nobody is going to bail us out of we make the wrong decisions.

[mv1986]

Silver and Gold are being purchased like crazy, and people are buying more Bitcoin too the price is going up as we speak. What an insane week for the markets. Surely BTC has a chance for a huge upswing. I mean honestly this is looking very BULLISH for BTC, is it not?

It's great news that the bitcoin market is going up again. Any negative news in the financial sector that leads to higher crypto demand is good in my opinion. The question is now if this is only a short term effect or a more long term trends. It was just a matter of time for the high inflation to lead to higher interest rates, which in return makes loans more expensive. Both of the insolvent banks were focusing on the high yield market where is a lot of more risk involved. They were trying to get higher returns by giving money to start ups. Its good that Biden is not going to bail out the banks. Nobody is going to bail us out of we make the wrong decisions.

Yes it makes loans more expensive but it also puts stocks under pressure as people who follow a conservative investment strategy might now tend to buy bonds instead of stocks. I was a bit surprised that Bitcoin went for such a massive jump from just under 20k a c couple of days ago. Very good sign indeed when it times of turmoil Bitcoin achieves a turnaround momentum in price.

It seems that more people might now understand that the higher interest rates on bonds aren't that great for as long as inflation is eating away any yield they are making with their bonds. The sudden jump in price also seems to have been a strategic short squeeze as well. Guaranteed some pessimistic guys in hopes of Bitcoin falling even lower now got crushed brutally.