Notes today:

• Deploying regulators: Treasury department reviewing us bank exposure to credit swiss..
• Credit Swisse: Today’s 24% share price decline eclipses even the worst days of the Global Financial Crisis of 2008. (weekly chart)
• Probability of default is 47% - so says the market (CDS).

"There is never just one cockroach in the kitchen" Warren Buffett 

With more cockroaches making an appearance, could gold perhaps  take out the previous hump?

Regulators have been warning for some time of the myriad crypto risks seeping into the mainstream banking system, comparing them directly to the $1.3 trillion subprime mortgage market that incentivized greed, exploited regulatory arbitrage and eventually led to the 2008 economic meltdown. 

 

Notes today:

Lawrence H. Summers on CNN: SVB committed one of the most elementary errors in banking: borrowing money in the short term and investing in the long term. When interest rates went up, the assets lost their value and put the institution in a problematic situation. 

Quite true Larry, however borrowing short and lending long is what banks always do and have always done - it’s the only thing banks seem to know how to do. (see banking and commercial real estate)

Perhaps the Fed (and the regulation opposing dudes) could make sure that all banks have a risk manager in "place" (and not  across the country away from the rest of SVB’s top fools) that understands duration and conceivably even understands how to hedge a bond portfolio. Perhaps someone could point these risk managers to the futures exchanges.

This stuff is learnable. 

• In a case that starkly illustrates the deadly consequences that the US’s permissive gun culture has on the country’s youth, a three-year-old girl accidentally shot her four-year-old sister to death in their Texas home late on Sunday, according to authorities.

• Biden approves controversial Willow oil drilling project in Alaska.👎

 

Notes today:

• Recession may arrive sooner than anticipated..

• First Republic (FRC) down more than 60% in premarket trading as measures taken by regulators so far fail to calm investors.

• Silicon Valley Bank's depositors are helped, equity and bondholders are being wiped out. 

• Signature Bank (crypto scheme focused) closed by regulators ..

• Former board member 

•   

• Ayn Rand  - not so popular in silicon valley today.. But no worries, welfare for adherents,
  hypocrites and frauds -  continues...

• The decision of the Swiss authorities to destroy decommissioned but fully operational and not obsolete air defence systems instead of deliver/sell them to Ukraine is like a decision to destroy bread amid famine. It is way more than just coldness or lack of empathy. It is cruelty. Sergej Sumlenny @sumlenny

• The Russia situation:
• Artist:
  @Patbagley
  
  
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Billions Worth of Crypto Trades at Risk as Bank Shutdowns Take Toll...

Crypto: I just avoid it as if it were an open sewer, full of malicious organisms,” Munger said in an interview with the Australian Financial Review.

• Nassin Nicholas Taleb on Crypto / Bitcoin     (Internalize)

• "'It turned out that one of the biggest risks to our business model was catering to a very tightly knit group of investors who exhibit herd-like mentalities,' said a [SVB] executive.... 'I mean, doesn’t that sound like a bank run waiting to happen?'" https://ft.com/content/b556badb-8e98-42fa-b88e-6e7e0ca758b8

 

Quick Overview is up to date

• Silicon Valley Bank chief pressed Congress to weaken risk regulations 😫Touting “SVB’s deep understanding of the markets it serves, our strong risk management practices”.....

• German banks also suffering due to SVBC collapse. German Bank index at 1980 levels..

 

SVB_Financial: As expected, libertarians a screaming loudest - they need to be bailed out, FIRST!

"Where is Janet with "my" check?"

Notes today: 

• First Flight of Regional Jet Powered by Hydrogen Fuel Cells–40-Seater is Largest Ever to Fly.

• One brokerage estimates that there will be about 330 million square feet of excess office space by the end of the decade.

• WHO: there have been about 677 million covid cases and 6.9 million death.

• Alphabet’s CEO Sundar Pichai thinks that generative AI (ChatGPT / Microsoft) will be “more powerful than fire or electricity”. 😕

 

Notes today:

• Banks F*****Up regularly  – you can count on it! Same old movie different actors..

• Regulators took over California-based Silicon Valley Bank on Friday in the second-biggest bank failure in US history. 
• "There is never just one cockroach in the kitchen" Warren Buffett
• Stablecoin (“stablecoins“  hilariously named) giant Circle Internet Financial Ltd said $3.3 billion of its about $40 billion of USD Coin reserves remain at Silicon Valley Bank...
• USDC's normally stable price sank to $0.89 from $1 while Ethereum gas fees soared hours after the crypto-tied bank failed.
• The ramifications of the Silicon Valley Bank (SVB) crisis have spread to Sweden. SVB's plunge wiped out more than half of the value of the holdings that Alecta — Sweden's largest pension fund — had in the bank.

• Russia: The life expectancy for young men is now as low as for men in Haiti—and lower than in Bangladesh. (Economist) 

• China hiked its defense budget by 7.2 per cent, marginally higher than last year, to 1.55 trillion yuan (about USD 225 billion), marking the eighth consecutive year of increase in its military spending. China is the second biggest spender on defense next to the US whose defense budget for 2023 totaled USD 816 billion.

 Why central banks are stockpiling gold

 

Economics, simply put

 

There is a limit to the amount of information that a person can absorb. This means that choices which they believe to be informed and rational can look irrational to someone with greater knowledge. As any behavioural economist worth their salt could tell you, this theory of decision-making is known as “bounded rationality”.

 

But you’d be forgiven for not knowing that. Economics is littered with complicated-sounding ideas that, once grasped, help to make sense of the world. So we have published a glossary of economic terms, explained in plain English. Our A to Z of economics includes almost 500 cross-referenced entries. Some link to longer explainer articles exploring the topic in more detail. And we’ll keep adding to the list. So the next time you’re puzzled by the Nash equilibrium or struggling to explain quantitative tightening you’ll know where to look. We hope it offers you an absolute advantage (which is also, conveniently, the first entry on the list).

 

Quick Overview is up to date 

 Latest US Inflation and Fed Funds comp.

Notes today: 

• “Despite our citizens’ penchant – almost enthusiasm – for self-criticism and self-doubt, I have yet to see a time when it made sense to make a long-term bet against America,” - calling near-term economic and market forecasts “worse than useless.” 
• Do yourself a great big favor and read it! Warren Buffett 2/25/2023  
• We are understanding about business mistakes; our tolerance for personal misconduct is zero.

• China's single population to reach 400 million, youths staring at being single for life...

• Rise in Auto Delinquencies
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• 
• 
   Car  Loan Payments Soar to $1,000

 

Dow Trend Earnings (aka Fed Model) is up to date.

• Perhaps, you may want to note that the equity risk premium (FEAR) is at its lowest since the run-up to 2008.

 

Quick Overview is up to date

 

Quick Overview is up to date

Wishing You and Yours a Very Happy Holidays 

Notes today: 

• reuters: widespread covid in china could result in up to 2m deaths.
• Crematoriums across China are straining to deal with an influx of bodies as the country battles a wave of COVID-19 cases that authorities have said is impossible to track. Cases are soaring across China, with hospitals struggling and pharmacy shelves stripped bare.

• As anticipate, the Bank of Japan, the developed world’s last holdout for rock-bottom interest rates inches toward policy normalization. 
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• Petulant Elon’s Twitter BS is leaking into tesla. Tesla stock tanking today, down 3%, 63% YTD. New low on the move. 
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• Not sure that the crypto disaster / scheme will not bleed into the rest of the markets – and be supportive to traditional (Gold/Silver) hard assets.
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Covid is spreading faster than ever in China. Hospitals appear completely overwhelmed ever since restrictions dropped. Some Epidemiologist estimate >60% of China & 10% of Earth’s population will most likely be infected over next 90 days. Deaths could be in the millions—Some experts think that doubling time may now be hours.

• But hell, let’s not get BioNTech or Moderna – Vaccines that work!

A fundraiser that will make history

JOIN TIMOTHY SNYDER'S FUNDRAISER FOR THE «SHAHED HUNTER»!

Give, Donate, Contribute!  NOW!

 Musk/ Twitter suspends ....

Anyone critical of his disastrously failing operations and connections.

Keith Olbermann

Aaron Rupar

Donie O' Sullivan

Drew Harwell,  and others - links to competitors such as Mastodon no longer appear to be allowed!

• This dude is acting as if he is in financial trouble and it is affecting his judgment..
• Twitter Bankruptcy looks likely  .

• Twitter will probably be history in the EU in the near future.

• What a self-destructive jerk! Laurence Tribe

• Eric Garland         @ericgarland

Washington Post expected more democratic values from the South African dude who just hired a member of the Chinese Communist Party to run his car company in Texas.

 

• Elon Musk starts banning critical journalists from Twitter

   / 

  The reporters have tweeted about his private jet recently.

• 
  

 

CPI ex shelter and used vehicles

 

Hail to the New Troll-in-Chief 

“He’s studied Trump and knows how to say the most outrageous shit and drive the news cycle,” Bannon confirmed. And his wealth has been cut in half from its $340 billion peak partly due to his Twitter purchase.

• Tesla investors voice concern over Elon Musk’s focus on Twitter ..

• Musk/Twitter has stopped paying rent on offices and is considering not paying severance packages to former employees, among other measures. 

Nestle to launch new Ukraine facility in rare war-time investment

US Companies continue to buy back  stock.

The Bird is beyond saving. 

Check out Mastodon

For the record: Dr. Fauci has done nothing wrong, except serve our nation. In the meantime, Mr. Musk should know that 200,000 Americans needlessly lost their lives from Covid due to this kind of antiscience rhetoric and disinformation. Elon, I’m asking you to take down this Tweet.

Prof Peter Hotez MD PhD  @PeterHotez

Central Banks stockpiling Gold

 

Quick Overview is up to date

 Renting versus Buying - historically high..

 Yield Curve:

Birds are departing twitter.. 

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