Elon is a tough guy to figure out. He will have a brilliant idea one day and the next day come up with a real head scratcher like buying SVB.
He never explains his reason. Just one sentence twits.
Silicon Valley Bank (SVB) Collapses
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Elon is a tough guy to figure out. He will have a brilliant idea one day and the next day come up with a real head scratcher like buying SVB.
He never explains his reason. Just one sentence twits.
If it weren't for America's military, the dollar would not be the world's currency. And our military presence and capability is on a decline. We're running out of military hardware simply supporting the Ukraine - and we're now realizing it's going to be difficult replacing it.
The Russians will ultimately prevail in the Ukraine and if China decides to take Taiwan we will be powerless to stop it. Perhaps the good news is that war on a global scale is obsolete. Is any nation, say China, Russia, the US, etc., are any of those countries willing to see their beautiful, world class cities and population centers reduced to rubble? I don't think so.
Scott
My bad...get 1000 powerball winners together...bam...you get the idea...
In the end, all we have to do is maintain GDP growing at a faster rate than debt payments over time - we do not have to "payoff" the debt...ever....we will always issue more.
That only works when you have inflation. Only hopelessly indebted governments benefit from inflation. The taxpayers in the trenches, people like you and me, do not.
And with respect to the Powerball, there are not 1,000 $400M winners every year. 1,000 winners a year would be three a day.
Scott
Warren wasn't the only one they went to. They also tried to get a loan from their substantial reserves of life insurance premiums that were held by their life insurance sub in safer investments for future payouts to beneficiaries. The NY Insurance regulator stepped in to stop that transfer of funds.
IMO this is similar but not to the scale of 2008/9 when the banking world was hit hard by bad mortgage loans. SVB is known for risky loans, as others have pointed out. This is certainly a wake up call for the industry and regulators to check in on banks but I don’t think it will be as wide spread as initially thought. This bank failed because of bad management and bad practices.
On a side note I’ve been telling my FIL who loves Cramer that he’s a blow hard. I don’t trust him or CNBC.
Just my $0.02
On a side note I’ve been telling my FIL who loves Cramer that he’s a blow hard. I don’t trust him or CNBC.
Just my $0.02
And this is why 1/2 of the globe is aligning to drop the petro-dollar. It turns out that fiat currencies - which are a debt and promise to pay - that the lender can devalue with simply making more, is unpopular for the debt holder. Who'da guessed that?
It's just too much money, and our debt to GDP is negative. It would be impossible to repay in ideal times. These are not ideal times. This is why the other forum members have referenced the move to a digital currency. The plan is obvious, the US plans to default on the dollar and shift to a new fiat digital currency, with a lot of very scary big government controls over it all. It's coming. Like that quiet little tsunami wave out there in the ocean that looks so harmless for now.
Scenario/analogy. Pretend you collect rare historically important autographs, and you will trade me valuable goods for them. I offer a few, and you trade physical assets. Then I produce more, which I'm really just fabricating out of thin air. At some point you're going to match these and realize these are just my worthless signatures on paper, and stop trading with me.
When I was a young boy, in 1980, our entire national debt was less than $1 trillion. So in the approximate 250 years of the US history, we accumulated around $900 billion total debt. Coming OUT of a deep energy and economic crisis in the 1970s. At that time, our GDP was 35% more than our annual debt. A tax payer's share of that was about $10,000.
https://www.usdebtclock.org/1980.html
Now, in my single human lifetime, the economic numbers are so large they are unserviceable. It costs about $1 trillion annually to service our debt at nearly $3 billion per day on just interest. At $32 trillion debt, each taxpayer owes about $250,000. Our unfunded liabilities are nearly $180 trillion. Yes, that is correct. There's just no possible way we can begin to repay our debts or fund our future debts.
https://www.usdebtclock.org/
This is due to a series of economic crashes, bank scandals, housing scandals, stock market scandals, and a bunch of burst bubbles from a myriad of complex scams and frauds, shell games, with tax payers holding the bag. In the 80s, in late 90s, early 2000s it happened twice, then in 2020... This is what happens with easy unregulated fiat currencies ripe for corruption scams, fixed by more elaborate scams of borrow/print/bailout crooks, and devalue currency in the process. This is not a new story, other major fiat currencies failed in history. Ours is just "next" for failure.
Instead of fixing these, moving to an actual standard, and punishing those at fault, we essentially just papered over the problems, kicking the can down the road as we figured out we could just turn on the printing press, borrow money from superpowers like China, and patch this mess up by largely crony capitalism bailouts of the elite class. And that temporarily worked, when our debts were still low, and people were willing to lend us money. The problem now is our debts have become unserviceable and the list of those willing to lend money is growing smaller. We are the town drunk who clearly cannot and will not repay loans but probably borrow money and then default.
So, how long can this continue? This shell game of borrowing, printing, to repay and fund debts? Which ultimately devalues the money held by debtors. It is a mathematical impossibility for it to continue. And hence we are seeing major national and global upheavals. The highest inflation in 40 years, tripling interest rates to stimulate savings and curb spending, national moves to a "new currency" which is a transparent scheme to wipe out debts and reset the clock (which will destroy entire economies holding US debts) and allow more control of US taxpayers, global moves to dump the petro dollars with the BRICS+++ nations, other nations looking toward precious metal backed currencies, and a lot of business alignments between the rest of the worlds 4+ billion people aligning against the west (Brazil, Russia, India, China, Saudi Arabia, Iran, Iraq, and others)... We overplayed our hand and half the world is figuring it doesn't really need the 350 million Americans' service and entertainment economy or fiat dollars.
This is 100% correct. With our sabre rattling, and 0-5 record against non-superpowers since WWII, the rest of the world has concluded the US is a paper tiger. As a patriotic combat vet this is a tragic fact that has taken me deep soul searching to understand, but it is the reality. Our bullying others is coming to an end. The Saudi and other oil producers traded dollars for protection, but that is coming to an end in the near future as these oil countries look to China and India and their 3 billion people, and as China looks to dump the dollar in favor of trading with oil-rich Russia and with India's industrializing 1.3 billion people and so forth. China is making big inroads in mineral rich Afghanistan and S. Africa, building huge oil pipelines between Russia and China, etc. The rest of the world is looking at the US as a distant, obsolete nation, with a relatively small population.
This is all an interconnected ecosystem of military backed finances, propped up by a myriad of institutionalized cons and corruption made easy by fiat dollars, and it's collapsing for the US. The SVB collapse is just the 2nd of many financial scandals we are going to see as more shell games face their "margin calls."
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Cramer is a television series, he's an actor with an act, a mouthpiece for the Wall Street casino. He's entertainment.
Scott
There's a lot of very funny memes circulating, referencing the Jimmy Stewart bank scene in "It's a wonderful life."
I'm not going to argue you are wrong, but right now it looks like the reverse is happening. As Pablo referenced in his post, SVB is taking down some of the cryptos. Stablecoin, with it's value tied to the dollar, has been used as a rock solid reference point in many transactions. With it getting blown up, the foundations of the crypto world will shake.
There's a lot of cryptos out there, thousands I think. I agree we'll see most are cons and scams. These are being shaken out of the tree, like the downfall of FTX last year.
I remember in the early 2000s, the first time I heard the word trillion, when our debt eclipsed $3 trillion, in a conversation pertaining to our debt. I thought it was a made up word.
Now, folks use it in common parlance like it's a regular number. No big deal. But how do you comprehend a 'trillion?'
In seconds, a trillion seconds is about 32,000 years.
In dollars, you could give every species on the planet $1.
How much does a trillion dollars weigh? Well, one dollar bill weighs about one gram. So, one trillion dollar bills weigh one trillion grams. Convert grams to pounds and you're looking at about 2.2 billion pounds or over 630,000 mid-sized cars.
We owe $32 trillion in national debt, and $182 trillion in unfunded future liabilities. SVB is the start of what's to come.
Now, folks use it in common parlance like it's a regular number. No big deal. But how do you comprehend a 'trillion?'
In seconds, a trillion seconds is about 32,000 years.
In dollars, you could give every species on the planet $1.
How much does a trillion dollars weigh? Well, one dollar bill weighs about one gram. So, one trillion dollar bills weigh one trillion grams. Convert grams to pounds and you're looking at about 2.2 billion pounds or over 630,000 mid-sized cars.
We owe $32 trillion in national debt, and $182 trillion in unfunded future liabilities. SVB is the start of what's to come.
Unfortunately some viewers have lost big money listening to this idiot.
"How fast is Elon Musk making money? His net worth in 2022 was calculated to be about $273 billion. This means he makes an average of $432 million per day!"
Net worth isn't income. It's the accumulation. He could make zero and still have the same net worth. $432M, provided the ciphering is accurate, is how much he could spend per day if he intended to spend down to zero in a year.
Deregulation + near zero interest rates + bad management. Yup. Banking recipe for disaster.
Deposits feed the bank. Bank pays interest. Bank makes loans at rates > deposit interest to make money. With ultra low rates, this is a risky business.
Will the gvt bail 'em out like we did before? Remember too big to fail? Who the heck knows.
Some employees may not get their paychecks... Oops!
Deposits feed the bank. Bank pays interest. Bank makes loans at rates > deposit interest to make money. With ultra low rates, this is a risky business.
Will the gvt bail 'em out like we did before? Remember too big to fail? Who the heck knows.
Some employees may not get their paychecks... Oops!
In the sense that their jobs are gone for the future, yes. But the obligation to pay for hours already worked is at the top of the list as assets are distributed.
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