☕️ BAIL OUTS ☙ Saturday, March 11, 2023 ☙ C&C NEWS 🦠
What you need to know about the bank failure; more everyday heart attack, stroke and cancer threats; Jane Fonda says the quiet part out loud; and DeSantis lists Florida's long list of wins.
Welcome to C&C’s weekend edition and good morning! I’m writing to you from the snowy wonderland of Coeur d’Alene, Idaho, after a long day of travel yesterday all the way from sunny Florida. The gracious hosts of today’s conference, Compass International, got me a delicious birthday cake and “multiplied” it into an accompanying tray of “So” mini-cupcakes. So!
As an East Coaster, it didn’t occur to me until yesterday evening that for the next week, you guys will be getting your roundup later than usual, since I’m three hours behind you here in the Inland Northwest, as the locals like to call it.
Your roundup today includes: it’s daylight savings time and you know what that means; I had to read a dozen articles to figure out what you need to know about yesterday’s sudden and unexpected failure of Silicon Valley Bank; Jane Fonda says the quiet part out loud on live TV; and DeSantis gives a presidential warmup speech highlighting the pandemic’s surprising effects.
🗞*C&C NEWS AND COMMENTARY* 🗞
💉 Remember to set your clocks ahead today, it’s daylight savings time. Because we now live in bizarro-clown world, some “experts” are using the time change as yet another way to obscure the cause of the mystery pandemic. Winnipeg news interviewed an expert this week who suggested that setting clocks ahead “increases the risks for heart attack, stroke, and even cancer.”
Now they tell us! I’ve been complaining about Daylight Savings Time for years, whereas Michelle is a huge fan, and I really could’ve used some dynamite ammunition like this. Still, isn’t it weird how they’re just now figuring it out? How many could’ve been saved, had the scourge of Daylight Savings Time been recognized earlier?
Well, that’s science for you, always stumbling across things that was right there in front of its pallid face the entire time. Like when that apple fell on Newton’s head, and he shouted, “eureka, it’s gravity! Now let’s change the times around on everybody twice a year and see what happens.”
Since Winnipeg News’ expert basically is SCIENCE, we will surely see a lower incidence of “heart attack, stroke, and even cancer” in all the areas that DON’T follow Daylight Savings Time, right? Or is that not how science works anymore? I can’t keep track.
🔥 The waiting is over: the next “emergency” has landed, and my radar detects another orgy of federal money-printing heading our way. Yesterday, news broke that a prominent tech-sector bank had a sudden and unexpected heart attack and is now on financial life support. The Wall Street Journal’s top story this morning is headlined, “Silicon Valley Bank Closed by Regulators, FDIC Takes Control.”
California Silicon Valley Bank (SVB) cratered yesterday, becoming the second-biggest bank failure in U.S. history. A Thursday run on bank deposits doomed the tech-startup-focused lender’s plans to raise emergency capital from new suckers, I mean investors.
According to papers filed by federal regulators, on Thursday alone, SVB customers tried to withdraw $42 billion — about a quarter of the bank’s total deposits. The avalanche of panicked withdrawals wiped out the bank’s finances; when business closed on Thursday, SVB was corporately overdrawn by nearly a billion dollars and couldn’t possibly cover its outgoing payments.
People can’t believe how fast the bank collapsed. Earlier this week, Forbes had even ranked the failed financial powerhouse as one of “America’s best banks of 2023”:
According to yesterday’s regulatory filings, the crisis was provoked on Wednesday night when credit-rating agency Moodys dropped SVB’s credit score. That caused the bank’s stock to drop sharply by about 60% first thing on Thursday morning. The plunging stock price spooked already-antsy depositors, who rushed to grab their cash as fast as they word could spread, before something worse happened.
Something worse happened late Thursday afternoon when the bank’s website and all its ATMs went offline. Then, at 9am sharp yesterday morning, federal regulators took over the bank.
Without a government bailout or a white-knight buyer, SVB depositors with combined balances over $250,000 immediately lost access to the excess, and will eventually just get a teeny-tiny payment from the bank’s liquidation, at pennies on the dollar.
SVB’s failure poses some pretty big immediate problems to its customers, and in a bigger picture, has spooked the markets. The Journal listed off some other banks with similar problems to SVB that are likely to fail next. San Francisco-based First Republic Bank, which caters to businesses and wealthy individuals, lost about 30% in its share value since Wednesday. PacWest Bancorp, focused on real-estate ventures, saw its shares plunge 54% in the past two days. Two crypto-based banks, Signature and Silvergate Capital, are also reported to be distressed and maybe on the verge of bankruptcy.
The stock markets halted trading yesterday on Signature Bank, Western Alliance Bancorporation, First Republic and PacWest Bancorp, because shares were being sold off so fast.
A related journal article yesterday carried the headline, “After Silicon Valley Bank Fails, Tech Startups Race to Meet Payroll.” It quoted an industry investor trying to get his head around SVB’s sudden and unexpected collapse. “If SVB, which for 40 years has been a pillar of the startup ecosystem, can disappear in 36 hours, what else is going to drop?,” asked FirstMark Capital founder Rick Heitzmann.
In Roku’s regulatory filing yesterday, the streaming provider said $487 million of its $1.9 billion in cash is deposited at SVB. Those deposits are uninsured, and Roku said it has no idea how much it will recover, if anything. Videogame company Roblox disclosed that about 5% of its $3 billion of cash and securities balance (about $150 million) were deposited at SVB.
All these banks serve well-connected citizens and the most likely scenario is a bailout, if the FDIC can’t find a buyer. I mean, we’re bailing out Ukraine, so why not bail out U.S. banks?
Not to mention that this “emergency” will create yet another chance for a lot of no-bid contracts and executive orders. After all, it was the 2008 financial crisis that provoked Obama advisor Rahm Emanuel to remark, “you never let a serious crisis go to waste.”
There are some pretty hot takes flying round social media, right up to overheated hand-wringing that SVB is just the first flipped domino with the entire world financial system to topple bank by bank into a financial abyss, or that SVB’s collapse will trigger the adoption of the new one-world digital currency or something.
These wild rumors are mostly based on the fact that, in the one larger bank failure than this one — Washington Mutual in 2008 — the U.S. banking system nearly collapsed before the feds got it under control.
It’s far too early to soberly make any apocalyptic predictions like that. In the 2008 Washington Mutual case, all depositors’ accounts were pretty quickly transferred to buyer JP Morgan Chase, who acquired the failed bank for $1.9 billion. No depositors lost any money, and no deposit insurance was needed, although JP Morgan did not acquire any debt (like high-risk mortgages).
Folks will point out that SVB’s failure is different from the 2008 WaMu collapse, which is perfectly true, as you might expect since these kinds of situations are highly unique.
Everyone in banking, finance and regulation is waiting for Monday to see what will happen when the markets open. Will other banks fail one-by-one, like they did in 2008, when investors subscribed to the FDIC’s daily “bank watch” email service? Will depositors start pulling funds from all their banks if they are over the insurance threshold of $250,000, to spread them around to other banks?
These are all good questions, but the most important question is how MUCH will the government get involved, and how much worse will the government’s involvement make the problem?
🔥 On Thursday, a very angry Jane Fonda, 96, apparently intentionally said the quiet part out loud on live TV, sending the goofy View ladies into a tizzy. By the way, Fonda has had so much plastic surgery she looks like an elderly Ukrainian woman wearing a rubber Jane Fonda mask.
The last time I reported a clip by communist plant Jane Fonda, was when she was doing her best impression of an manic, gloating snapping turtle, babbling incoherently about how the covid pandemic was the best thing that had ever happened for the Left. Which was only true for a few months, then reality set in.
Anyway, now the snapping turtle is back, on the View this time, calling quite seriously for murder as a solution to states tightening abortion laws.
Here’s the relevant bit, with the clip following below:
JANE FONDA: We’re not going back, I don’t care what the laws are.
VIEW ANCHOR: Besides marching and protesting, what else do you suggest?
JANE FONDA: There’s always murder.
VIEW ANCHOR: Well, apart from a miraculous … What did you say?
JANE FONDA: Murder.
VIEW ANCHOR: Oh don’t say that … they’ll pick up on that and… she’s just kidding. Let’s move on to Jane’s activism, which is legendary!
But Fonda didn’t look at all like she was kidding. She mostly looked like a usually-cross woman who’s even more annoyed than usual thanks to a weeklong bout of constipation. That’s it, she’s more like a constipated snapping turtle.
Fonda never took it back or softened her comment in any way. To be honest, I credit Fonda more than the other clownlike View creatures. At least Fonda is honest. She’s not hiding behind passive-aggressive shibboleths like “oh, I was only kidding.”
Don’t get over-excited and start going around calling democrats out for not denouncing Fonda’s statement. Liberals suggesting murder as a political tool is NOT Nazi-like behavior, or fascist, or anything like that. You’re just imagining that because you’re a heartless conservative. Calling for political murder — when it’s done by a leftist — is kind, tolerant, inclusive, and diverse.
Because the words no longer mean what you think they mean. Unless you refuse to play the dictionary game with them, of course.
YOU explain why anyone listens to Jane Fonda about anything. I can’t.
🔥 Yesterday, the entire House of Representatives — Republicans and democrats alike — voted unanimously (419-0) to require the Biden’s director of national intelligence to declassify all intelligence related to the Wuhan Institute of Virology and any possible links to the origins of the covid virus. The information would have to be Released within 90 days after the bill is signed into law.
The Senate passed the bill last week with similar margins. So it now goes to Biden’s desk. His signature appears to be basically irrelevant — if Biden signs it, it becomes law, and if he vetoes it, both chambers easily have the two-thirds vote necessary to override his veto.
It’s not yet clear what Biden will do. In a press conference yesterday, super-extra-diverse press secretary Karine Jean-Pierre equivocated, saying Biden wants to look the bill over, and reflect on it before he decides what to do, which made me laugh harder than the time Harry Reid claimed he was beaten up by his own exercise bands.
Biden’s going to “think it over?” Please.
Isn’t it sweet to see Republicans and democrats getting along and working together? Maybe it’s ushering in a new era of cooperation or something as the two side find common cause with each other. That’s probably it, right?
🔥 Ron DeSantis gave a lovely speech yesterday bragging about Florida, and recited a long list of areas where Florida is leading the country.
For just a few examples, the Governor mentioned that Florida is number one in a bunch of categories that he’s had a direct hand in:
— Top Law enforcement recruitment and support
— Top Tourism
— High Net In-migration
— Highest Employment rate
— Highest rate of new business startups
— Most Education freedom and parental involvement
— Highest scored Road quality
— Top space-related development, manufacturing and flight
DeSantis also named a bunch of other ways Florida is leading the country:
— Florida has the Top 3 cruise ports
— Crime rate is at a 50-year low
— The state has historic budget surpluses
On the one hand, it’s another surprising and unexpected pandemic outcome since, pre-pandemic, Florida was a purple state that wasn’t recognized as leading the country in anything particular except maybe hurricanes and voting problems (remember hanging chads?). Now Florida is perhaps the most-discussed state in the country.
The pandemic did that.
Also, don’t DeSantis’ comments sound a whole lot like a presidential warmup speech? The clearly-articulated suggestion is that DeSantis can do for the rest of the country what he’s done in Florida. It’s an obvious and compelling argument, but the federal situation feels a lot more complicated. Don’t get me wrong, I’m all for the Governor, but here in Florida, DeSantis has always enjoyed a super-helpful Republican majority in both legislative houses.
It would be great, but the Governor might not have that advantage as president, where he would also be facing a hostile deep state. What do YOU think? Let me know in the comments.
Have a wonderful weekend! I’ll see you guys back here on Monday, as early as I can get it out from the Pacific Standard Time zone, and we’ll kick the week off right.
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