Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
”First Republic’s stock is down more than 80 percent for the year, and other regional banks like Pacific Western and Western Alliance have lost more than half their values.”
Remind me never to invest in banks!
Thanks!
I don’t celebrate it any more. In my first teaching job at a small Catholic school in northern Michigan (late 60s) many of the “lay” staff eagerly awaited it. Great bunch to work with. We’d head for a local pub within walking distance rig…
Nicely said @LarryB
Was a lot easier at 60 to “bite the bullet” and buy down in 2008 than at 75 today. Nonetheless, I’ve added a bit of risk over past week, perhaps illustrating Franklin’s proverb - “Experience keeps a dear school …”
Diversi…
The fallout from the SVB (Silicon Valley Bank) collapse has finally put fear into the hearts of investors, and especially options traders, pushing up the VIX from the low 20s to a close of 26.14 on March 15, 2023.
Actually, VIX was in the “high te…
People have withdrawn bank deposits and moved into money market funds and T Bills. Banks can’t compete on short term interest rates because they have made long term loans at lower rates. I agree that an idiot could have foreseen this. Of course th…
@Crash - Thought I’d mention that what rocked markets today was the announcement that J.P. Morgan had put together a “rescue package” (loan) for First Republic funded by a number of banks. I was surprised they didn’t wait and release the informatio…
I’m confident @Crash can handle it. :) - But some sage advice.
What makes sense to me about the heightened volatility comes from Bloomberg media reports this evening: (1) There is a liquidity shortage, (2) As a consequence some hedge funds have h…
“I believe social media has magnified the bank panic.”
Both social and mainstream media have had a field day. “It sells in Peoria” (increases ratings).
There are no lines in front of banks. But there’s a lot of itchy fingers on keyboards moving…
”But now he is flipping! He is still bearish but says that this rally has room to run, and then collapse.”
Looks to me like it collapsed before it ran.
,
”This move in oil is rather unsettling.”
Lots of stuff is unsettling, including the escalating U.S. / Russia tensions. Might have played a role in today’s equity sell-off.
Oil is something I’m unable to understand or invest in. There have always b…
BRK.b was down almost 3% much of the day. Finished down 2.44%. Yet, AAPL was up for the day. And BOA BAC only lost 1%. Looks like insurance companies got hit. One I watch was down 3.4%. I’d think the issue relates to interest rates in some manner - …
Yes - Big move down in oil this week. Industrial metals getting hammered today too. I see lots of panic. Bloomberg said around noon the Fed is working on the Credit Suisse issue (along with other central banks and regulatory officials) and the U.S…
@hank, I grew up with the irresolute response to the last inflation. I don't want to spend what could be the rest of my life going through that again
@WABC -You weren’t pleased with Nixon’s 1970 wage & price freeze? :)
I was pretty irrespons…
The Dow was up +426 points around 11:00 this morning. Dipped down to nearly even at mid-day and then came back to finish +336, or just over 1%. I realize 1 day’s performance is meaningless and that the S&P (which gained 1.68% today) is a bett…
Changing the topic slightly … But you might make an argument that inflation harms the wealthy more than the working class. With inflation, if you have lots of money on deposit somewhere it depreciates in buying power while you’re holding it. On t…
TFC fell 17% today. Held some for a few months a year ago. Not a bad ride at the time. Whew!
Looked like a good bet at the time. Large growing regional bank. Headquartered in Charlotte NC. Conservatively run. Diversified investments. Hard to bel…
Thanks.
But I did get my three mile hike on the beach in first
+1
My hike today was on an ice & snow covered beach in balmy 27 degree temps with a 25 mph wind blowing. In a couple weeks I’ll be hiking on a much warmer beach, if only for a we…
OK - I stand corrected. Apparently it’s the still healthy banks that will make the depositors in the failed banks whole. And the FDIC has never run out of money from member banks and shall not this time. It would seem like a more transparent and si…
@Mark. Sorry - I can’t. But there’s some bizarre discrepancies today I don’t understand. A couple of my safest, most secure stocks are way down. One is a domestic conglomerate with concentration in media (-3%) and the other a U.S. consumers staple…
Thanks @LewisBraham - Didn’t intend to sound critical of anyone. I read Grantham quite a bit 12-18 months ago and learned a great deal from him. Helped prepare me for the onslaught later on in mid ‘22. It’s just that watching all the different gl…
I think in Grantham's case, given the models he uses, it's safe to assume he is referring to U.S. large caps, i.e., something akin to the S&P 500 or Russell 1000.
And pity those with such a narrow view of investing. Unless you’re 25 and DCA’ng i…
”stocks were in a speculative bubble and about to pop”
Statements like that tell you nothing. Which stocks? Where on the planet? A lot of time the general term “stocks” is applied to the U.S. S&P 500 Index. I’d have no problem believing Gran…
Anybody buying the dip ?
No. But I’m considering selling the pip. Depends what you own and what time of day it is. :)
I watch a lot and can’t recall such unstable markets in a short time. Probably occurred a few times in ‘07-‘08. Leadership tra…
+1 @MikeM
First day in a while I’m not tempted to do anything. Can you believe the 10-year is under 3.5% after having topped 4% only a week ago? If I heard correctly a few minutes ago, trading in Schwab temporarily halted due to volatility. Defi…
Well, Monday morning the word “Stategery” comes to mind. WTF should an investor do? At bedtime the Dow futures were + 450. Just before the open today they are - 250. Yields on 2 year notes have plummeted overnight. So have yields on the 10-year, …
@catch22. Thank you for the note on the 2008 TARP program. Yes - I seem to recollect the government recaptured that $$ along with interest. Let’s hope this new version (TARP 2?) operates in the same manner. There are scenarios one might envision wh…
@Old_Joe - I’m aware of the $250,000 automatic coverage and cap on FDIC insured deposits. My underlying point was that if the coverage of amounts beyond $250,000 were automatic than there would no longer be any need to distinguish between the $250…
Lots of reports (Bloomberg & elsewhere) that hedge fund manager Bill Ackman earlier today predicted an unraveling of the entire banking system starting Monday morning if the government didn’t step in and make whole the uninsured depositors at SV…
”A special assessment on banks will be implemented (as required by law) to cover Deposit Insurance Fund losses attributed to uninsured depositors.”
It sounds as if this (rescue package) is all pretty perfunctory - as it is provided for by law. And…
Schwab ran into problems in ‘08 with their “Yield Plus” ultra-short. Apparently they led investors to believe it was a safe, suitable substitute for a money market fund. It was down less than 4% when this article published in ‘08. But ISTM the fund…
Wow! That’s big! Thanks @rforno.
I figured the Fed would be involved behind the scenes. Maybe even the possibility of an emergency meeting + some additional action. But it’s unlikely. Could spook markets more and also confirm publicly how irratio…
I’d expect futures will open lower. Asia will be interesting too. It’s curious that there’s been nothing from the “Fed Open Mouth Committee” of late. Are they in their blackout period?
