Notes Today:

 

• Pornhub acquired … Ethical Venture bought them. No joke!

• Credit Suisse is exercising an option to borrow $53.75 billion (CHF 50 billion) from the Swiss National Bank - to stay afloat. 

• Goldman raised US recession probability to 35% on banking stress – I would put it a bit higher 50%? 

• March 16 (Reuters) - Bankrupt cryptocurrency exchange FTX made transfers of about $2.2 billion to company founder Sam Bankman-Fried through related entities, the company's new management said. (Btw, why is this dude  out on no money down bail? - remarkable)

• The Baltic Exchange’s main sea freight index, tracking rates for ships carrying dry bulk commodities, snapped its 19-session winning streak on Thursday, weighed by weakness in the capesize and panamax segments. 

  The overall index, which factors in rates for capesize, panamax and supramax shipping vessels, lost 43 points, or about 2.7%, to 1,560 – its biggest dip since Feb. 15. 

  The capesize index lost 128 points, or about 6.1%, to 1,976. 

  Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, decreased $1,066 to $16,387. 

  Dalian and Singapore iron ore futures slumped on Thursday, along with steel benchmarks in China as sentiment soured, mirroring a broader risk aversion triggered by fears of a banking crisis.  (Helllenic Shipping)

 

 Vacant US office space

 

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
  
  
• 
  
  
  

 

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”. 😕

S&P 500 stocks at 52 week lows          (0 at 52 week highs)               

SIVB.O	SVB Financial Group Ord Shs	106.04	-161.79	-60.41%
SBNY.O	Signature Bank Ord Shs	70	-20.76	-22.87%
FRC	First Republic Bank Ord Shs	81.76	-14.25	-14.84%
SCHW.K	Charles Schwab Ord Shs	58.7	-7.77	-11.69%
ARE	Alexandria Real Estate Equities REIT Ord Shs	126.8	-12.04	-8.67%
BXP	Boston Properties REIT Ord Shs	57.44	-4.5	-7.27%
LUMN.K	Lumen Technologies Ord Shs	2.68	-0.2	-6.94%
DISH.O	DISH Network Ord Shs Class A	10.53	-0.76	-6.73%
TFC	Truist Financial Ord Shs	38.84	-2.78	-6.68%
PEAK.K	Healthpeak Properties Ord Shs	21.42	-1.53	-6.67%
LNC	Lincoln National Ord Shs	25.66	-1.68	-6.14%
NWL.O	Newell Brands Ord Shs	12.24	-0.78	-5.99%
VFC	VF Ord Shs	21.78	-1.23	-5.35%
CMA	Comerica Ord Shs	58.81	-3.1	-5.01%
VNO	Vornado Realty Trust REIT Ord Shs	17.11	-0.77	-4.31%
FITB.O	Fifth Third Bancorp Ord Shs	30.37	-1.32	-4.17%
HAS.O	Hasbro Ord Shs	49.21	-2	-3.91%
CPT	Camden Property Trust REIT Ord Shs	106.91	-3.88	-3.50%
CF	CF Industries Holdings Ord Shs	78.47	-2.64	-3.25%
MTCH.O	Match Group Ord Shs	35.49	-1.16	-3.17%
TRMB.O	Trimble Ord Shs	48.28	-1.48	-2.97%
WRK	Westrock Ord Shs	29.81	-0.9	-2.93%
JKHY.O	Jack Henry and Associates Ord Shs	158.08	-4.73	-2.91%
PAYX.O	Paychex Ord Shs	107.83	-3.22	-2.90%
AIZ	Assurant Ord Shs	116.75	-3.13	-2.61%
OGN	Organon Ord Shs	22.68	-0.59	-2.54%
BAX	Baxter International Ord Shs	38.02	-0.97	-2.49%
ZION.O	Zions Bancorporation Ord Shs	40.35	-1.01	-2.44%
AKAM.O	Akamai Technologies Ord Shs	71.96	-1.74	-2.36%
D	Dominion Energy Ord Shs	53.21	-1.06	-1.95%
IFF	International Flavors & Fragrances Ord Shs	84.64	-1.43	-1.66%
SBAC.O	SBA Communications REIT Ord Shs Class A	240.12	-3.65	-1.50%
MKC	McCormick & Co Non-Voting Ord Shs	70.95	-1.05	-1.46%
MTB	M&T Bank Ord Shs	131.72	-1.92	-1.44%
MMM	3M Ord Shs	104.06	-1.46	-1.38%
AAP	Advance Auto Parts Ord Shs	128.04	-1.79	-1.38%
HRL	Hormel Foods Ord Shs	39.18	-0.54	-1.36%
BFb	Brown Forman Ord Shs Class B	61.52	-0.77	-1.24%
BMY	Bristol Myers Squibb Ord Shs	65.71	-0.8	-1.20%
EA.O	Electronic Arts Ord Shs	109.19	-1.27	-1.15%
TSN	Tyson Foods Ord Shs Class A	56.98	-0.66	-1.15%
CNC	Centene Ord Shs	65.1	-0.44	-0.67%
PNC	PNC Financial Services Group Ord Shs	137.16	-0.71	-0.51%
PFE	Pfizer Ord Shs	39.39	-0.07	-0.18%