저자: 진행자 · 외국인
요약 보기
2023년 3월 실리콘밸리은행(SVB) 구제금융을 두고 '사실상 납세자 구제(bailout)'라고 주장하며, 예금보호 한도 확대는 도덕적 해이를 낳는다고 비판. 이후 TS Lombard 분석을 인용해 자산 사이클 붕괴와 기술주 둔화가 경기침체로 이어지고 연준이 금리를 한 번 더 25bp 올릴 것이라 봄. 다만 인플레이션이 잡히면 연준이 다시 완화로 돌아설 수 있다는 골디락스 시나리오도 제시.
다듬은 글
well we just had a congressman freak out about the bank bailouts that are occurring and then of course you've got people in the Venture Capital space who are coming to the defense of the bailouts let's listen first to this freak out from representative Thomas Massey Thomas Massey has been pretty involved in these uh in monitoring and commenting on these bank bailouts you should listen to some of the comments he made because they might Echo some of the sentiment that or at least what you're feeling the last five days simplified he says on Twitter quote a group of wealthy speculators got upset that their money ended up locked into a 10-year obligation at less than a two percent return so they convinced the government that it was in everyone's best interest to help them out of their Jam at the expense of everyone else oopsies you've actually got people like the governor of California who apparently had three to four of his personal or Winery business account was one of the beneficiaries of the easy lending of Silicon Valley Bank and what's the governor of California doing last week when Silicon Valley Bank was having trouble pounding the table about talking to people at the highest level of the White House in the treasury Department to help protect you yet he doesn't disclose that he actually Banks there and he's really trying to save himself so maybe representative Thomas Massey is on to something but it's not just that see Thomas Massey goes on to say when the debt limit is increased the treasury is going to need over half a trillion dollars to unwind these quote Extraordinary Measures that have been implemented for this banking crisis now remember folks uh look I'm a licensed financial advisor I run an active ETF I've got ith an expiring coupon code got a real estate startup I I do Finance for a living people are clamoring about this idea about whether this is a bailout or not let's be clear today it is not technically a bailout it is using money that already exists in a treasury fund however that fund was established using Appropriations Congressional Appropriations which come from guess what taxpayer money that means taxpayers are guaranteeing this bailout so yes technically taxpayers are bailing out Silicon Valley and uh wealthier potentially uh entrepreneurs or businesses who had more than two hundred fifty thousand dollars in their accounts and and didn't you know manage their cash in such a way where they were properly Diversified remember you could use the FDIC calculator by Googling FDIC calculator and you'll be able to do that make sure you're at the dot gov website and you can see how easy it is to actually get up to one and a half million dollars of FDIC Insurance just by having various different accounts whether you're married or you've got retirement accounts business accounts whatever sole prop Corp accounts whatever it's actually really incredible how much FDIC Insurance you could actually get if you just try now the good news is everybody who escaped from the scot-free I think is now waking up to that and they got a little wake-up call and that would be a very smart time not to rely on the government it would be a very smart time to diversify your bank accounts but anyway uh Tom Massey goes on to say that he expects we are going to have to come up with about 500 billion dollars to unwind these quote extraordinary bailout measures because he says that what we're experiencing right now seems to be a shock to the current system and that if money is quote printed like it was printed for covet then unfortunately it's going to cause more inflation the reality is had the government not bailed out Silicon Valley Bank the reality is he says quote depositors would have only lost about 20 percent they wouldn't have needed all of their money right away now that's an interesting point because a lot of people are going we needed to do these bailouts because you know small businesses weren't able to make payroll let's be real if you had an 80 percent uh if you had access to 80 of your money and you took a 20 haircut you'd have enough money for payroll but it would it would let capitalism do its job and prove that the government is not just an infinite bailout machine and it's certainly not just a bailout machine of of on average wealthier Silicon Valley based startups now don't get me wrong I don't want anybody to lose money I'm just a capitalist at heart and I think any venture capitalist should be thanking the government that we have right now for the bailout because probably a 10 to 30 percent haircut would have been what would have happened so you basically got a stemi check from the government that's basically what happened and I'm happy for you don't get me wrong I'm not resentful I'm not upset I think though any entrepreneur would agree that as a capitalist it makes sense that a depositor should have some responsibility for determining where they put their money now the counter argument there is no that's the regulator's responsibility and when the hell does any capitalist say The Regulators are supposed to protect me really if your business fails was it the regulator's fault if you made a bad decision and you lost a big customer or client was it the right regulator's fault you know if you crash your car was it the DMV's fault if you uh you know a drink can drive because you bought alcohol at a liquor store and then you go drive and crash your car was it the liquor store's fault was it was it the regulator's alcohol board fault no it was your fault uh so so that's that's just the reality of a capitalistic environment and so I think Thomas Massey is really echoing that sentiment here uh that and he actually goes as far as saying look half of venture capital backed companies fail so like it's not like businesses don't go out of business like that's a normal course of business this business is going to business but also somehow Venture Capital firms managed to achieve greater than 10 annual returns or at least that's common says Thomas Massey and so the notion that several of these companies at Silicon Valley Bank taking a 10 haircut would have caused an apocalyptic disruption of innovation it's straight up he says this is Thomas Massey representative I actually think he he makes a really good point uh so uh he and as somebody ended up replying to Thomas Massey and says we bailed out a bunch of professional speculators and he replies to that and says precisely now I want to give you the counter argument because I don't just want to give you one side of the argument here but I want to respond to one of the comments here miss Mary says bartenders can be held liable well but that's also different right that's different from somebody walking into a store who's not drunk and buying alcohol what happens is when you're alkalized your ability to make a decision plummets and if you're wasted inside of a bar it is incumbent upon Society to protect somebody in my opinion who's incapable of actually protecting themselves if somebody's you know a 0.2 blasted drunk they're not capable of protecting themselves they're not an asset anymore to society they're a liability right and so yes Regulators have made that incumbent upon those around them but I don't think that companies who create failures you know based on their own business decisions are at the liberty of begging for the 99 of Americans who pay their taxes and work hard to bail them out that's just that's just my take again I've got nothing against startups I have a startup you know I'm just I'm just a more of a capitalist uh and probably lean more libertarian than suggesting we should just we should basically say FDIC Insurance 250.
nah it's actually unlimited yeah I think that sets a very very bad standards it encourages Risk by shareholders and Executives and even though they might lose everything if they could tell their customers hey you're basically unlimited uh unlimitedly protected by the government why not take the risk you have a greater chance of getting greater shareholder returns anyway uh in a financial times interview you had sort of another response this is Ken Griffin CEO of Citadel he says quote the U.S economy is supposed to be a capitalistic system and that's breaking down before our eyes we are becoming more socialist every time the government intervenes or at least the type of crony capitalism yeah like what you're seeing with Gavin Newsom I mean think about it uh FDA the the release that you got was that if FDIC took any kind of loss then what would happen is other member banks would just have to pay higher FDIC fees well what the hell is that that's called socialism oh one person lost money no problem we'll save them and we'll make everybody pay more because of the failures of you know a bank that was too aggressive you know that's that's as uh Ken Griffin puts it privatizing gains but socializing losses he says there's been a lot of loss of financial discipline with the government bailing out depositors in full Regulators have created a great moral hazard there is no incentive for depositors to remotely think about risks or due diligence when trying to stay within the 250k limits there's also no incentive for banks to risk manage as the government will always backstop losses moral hazard obviously is a term used sort of like insurance people act more Reckless when they know the liability is shifted away from them counterparty risk is essentially now no longer an issue there's no such thing as counterparty risk anymore if the government will just bail out everything remember the cefo of Lehman or of Silicon Valley Bank worked at Lehman Brothers so the people who say oh but the executives are going to get fired and lose their jobs and they won't be able to get a job anymore dude this the the person who worked at Lehman Brothers became the CFO of Silicon Valley Bank the idea that moral hazard will be limited because Executives will get you know fired is and you could see it in the fact that the guy who worked at Lehman Brothers ended up working as a CF the Chief Financial Officer at Silicon Valley Bank it's insane now the fed's launching a probe into exactly what happened with Silicon Valley bang uh and uh you know this was an interesting one even though an individual who left in April was paid two million dollars for her work uh four months of 2022 with a an average four to sixty thousand dollar severance package anyway it basically there's some arguments that massive amounts of money were being spent on uh salaries and bonuses and severances for people before the collapse but then you have people like David sacks who's a VC guy in rocana trying to basically share what they call the full picture and what they say is that this banking crisis originated in Washington that it's Washington's fault because they raise rates so rapidly dude how clearly did the FED Telegraph that they were raising rates to say oh well the banks are just failing because you all raised rates so rapidly what do you mean literally for the last two years they've been talking about liftoff and raising rates and for the last year they've been doing nothing but saying higher for longer higher for longer and Silicon Valley Bank got rid of all of their Hedges of increasing interest rates come on David sacks be real tell the world about all of the VCS that you were invested in that would have lost a crap load of money and potentially gone bankrupt at Silicon Valley Bank I don't think there's any way you could say you're not biased in the situation now that doesn't mean you can't have a reasonable argument just because you're biased doesn't mean you can't have a reasonable argument sometimes I'm biased sometimes I have a horse in the race and and maybe I'm biased right that's fine I think everybody has advice but I think it's very important to acknowledge that this is not capitalism David Sachs this was a bailout uh a buy taxpayers of private institutions as Ken Griffin says we socialize losses here now there might not end up being any losses that's possible and in that case we wouldn't socialize any losses because losses would be zero In fairness that is possible it's really just the FED coming in turning on the money printer and holding a bag which may prove not to be bag in the future especially if inflation goes away now you do have people like David sacks and rocana also criticizing the weakening of the Dodd-Frank protections for systemically important banks that we had in 2018 but Democrats voted for that as well it was Donald Trump a republican-controlled Congress and Democrats together who voted for this the only people who didn't vote for this deregulation in in 2018 the banking deregulation Bill were basically Progressive Democrats that's it so you got a super majority of people who voted for this deregulation so yes I think deregulation has something to do with this but that you know just because you know two rights don't make it wrong just because you made the mistake of deregulating doesn't mean you know now all of a sudden we should bail everything out to 100 a little bit of a haircut is healthy David sacks obviously Echoes what Bill Ackman say that well the run on the banks would have been a lot worse had we not come out to to bail these individuals out maybe that's entirely possible uh that you know the banking runs would have been a lot worse although I think the banking runs are still to some degree just beginning and that's another possible dangerous that the banking guns could actually continue to get worse I think what you've really done is you've sent I really think that Venture Capital people and startups are smart people I think there are a lot of smart people and I think the smart people who just had their ass saved at Silicon Valley Bank or signature or some of these other banks are going well I'm not gonna make that mistake again I'm going to diversify my Banks I think that's very reasonable and I think that's going to happen so I think the banking run is going to continue albeit at a slower less Panic Pace but I think that the true damage of that is still yet to be seen and that's why all eyes are on the FED for what they're going to do with hiking rates anyway Silicon Valley Bank was known for providing what was known as a white glove red carpet treatment of Silicon Valley Executives including providing not only basically credit lines to cash list companies or companies without any cash flow with little questions asked other than the fact that you were a startup but they also provided White Glove services for some of these folks including mortgages for founders of startups basically giving them whatever financing and terms they want just to promise to be a a member of the bank see that's not risk management folks that's nonsense anyway Regulators are attempting another auction of Silicon Valley Bank after failing to find a buyer of the weekend Banks and private Equity Funds are circling and startups are scrambling to find a new home for their cash during the chaos companies with accounts elsewhere transferred their funds While others struggled with red tape and frantically opened new accounts fantax like Brax apparently experienced a surge in activities with the company uh opening over 3 000 new accounts wow big Banks obviously like B of A City JP Morgan is seeing massive inflows uh these are called the gray carpet treatment Banks instead of a red carpet treatment Bank now this is true they have less customized Services right it's one of the reasons I've taken some of my money and had it at some of the smaller Banks because you you do have better uh funding and easier credit lines you know I was able to get a a rental uh rental property home equity line of credit relock uh and a 90 home equity line of credit from a small Credit Union I could have never in my dreams gotten that from a big four bank but I kept my exposure to those accounts to less than 250k or 500k as married individual right so like you can play the game you could use the riskier lending but at least include some risk mitigation procedures so worth noting obviously all of this comes on the heels of Greg Becker selling 3.6 million dollars worth in share worth of shares the SEC is now investigating this but on top of that you have TS Lombard which has a really interesting piece about how really this banking crisis could really just be the beginning of uh of of of really uh a greater recessionary disaster and I think this piece is really interesting to look at how the asset cycle ends but before we talk about how the asset cycle ends I have to thank you for being here really appreciate the fact that you're here it's it's nice of you to watch uh my videos my goal I just want you to know this is sincerely I want you to know that I'm a place you get unique perspective and value that that you find uh I'm not going to say you can't find anywhere else but maybe you find difficult to find somewhere else and if I can consolidate information and give you better value faster than anywhere else uh and more efficiently than than I'm very very happy about that because my goal is you know over the next 20 30 years I could keep making YouTube videos and providing this kind of value so thank you for for being here uh we couldn't do it without without y'all so uh it's a win-win I think all right so what does TS longboard to say us so basically they have this article here they have this piece and they're they're bearish right they're Bears so they have this piece where they talk about Bank assets will consequently migrate back to where yield is highest and uh liquidity is frictionless so in other words uh that right now what you're experiencing is there are two types of Cycles there's a credit cycle and there's an asset cycle see they say that ever since the GSE ended the U.S economy has driven been driven by an asset cycle rather than a credit cycle in other words this is money printing this here is borrowing and so you have shifted vulnerabilities from liabilities to assets when you have a debt cycle you have too much debt you have a liability crisis when you have an asset cycle you have too much cash so what do you do with that cash you park it into assets but if those assets like treasury bills lose values or lose their value then you get screwed right so the shift uh with is it basically is create some unique intra a unique distortions should I say uh and uh with the biggest Distortion you have is you have this massive flow of capital to tech companies however now we're finally starting to see a little bit of a U-turn in Tech and T.S Lombard says that U-turn in Tech is basically and potentially the beginning of the real recession that we're walking into they say here look at this section this this paragraph right here money like water flows in the direction of least resistance this was true for the Housing Industry pre-2008 and for Tech in the current cycle like housing Tech was distorted by a seemingly unlimited flow of cheap capital and credit just when Limitless cheap or limitlessly cheap turned into limited and expensive that is money as it always happens Tech revenues began to weaken so in other words at the same time as interest rates started going up and we turned the money printer off Tech Revenue started going down now there could be a causation correlation argument here but anyway the outsize tech expansion in the past few years and its current crunch is particularly evident in employment after leading the economy and hiring tech leads the reduction in head count Looking Back to December of 2019 as a base of comparison Tech employment is up 15 versus four percent for the employment of the area excluding Tech retail and Health Services and Leisure and Hospitality in other words employment at Tech up 15 everything else only up four percent however Tech is now down while you're still seeing increases in retail so what else does TS longboard say us about this well what do they say they tell us that asset slash liability matches have gone awry because deposit outflows have broken the the traditional model that we're used to with and this is reminiscent of what happened with collateralized debt obligations back in 2008 mortgage defaults skyrocketed through lower tranche firewalls that were suggested or that model suggested could not happen in other words we relied on these fancy models in 2008 that suggested things can't be that bad yet what are we dealing with today well we're dealing with these models that suggest oh don't worry we could spend through the recession the recession won't actually be that bad well that really remains to be seen and TS Lombard really thinks that a recession is ahead of us they say In Sum a recession is inevitable Silicon Valley Bank and the knock-on impact on Bank credit activity brings forward the timing and keep an eye on Tech the flow of economic data in the coming few days CPI today which we already had that was yesterday because this report was from yesterday uh we'll have uh or actually CPI was now two days ago anyway we'll have the fomc pike hiking by 25 BP next week the FED also hiked through bank failures before and will through this one that's a very interesting argument they're saying look Tech which was the Big Driver weakening the asset bubble is turning everything's slowing down this recession is going to hit hard but not only is this recession going to hit hard you better believe the FED is going to go for 25 BP here the fed's done it before and they'll do it again precisely because it will not be seen as systemic to the banking system in other words the Credit Suisse drama Silicon Valley Bank will not be seen as systemic while this is true relative to 2008 Silicon Valley Bank is also a warning that there may be more damage to come in the financial system this is not mortgages creating a great financial crisis but it nevertheless leads to a recession outcome so in other words the Slowdown of the asset cycle the banking crisis the tech slowdown TS Lombard's opinion big recession coming that's what gets rid of inflation now all of that comes on the backs of uh these these comments of us bailing out Banks is there a potential Goldilocks solution here maybe counter argument is bail out these idiosyncratic issues these individual Bank issues bail them out let inflation fall with inflation or with the rates that we have now maybe another 25 BP or we stay stable let inflation fall as inflation Falls maybe we can keep going without more banking crises and more banking failures in which case if we end up killing inflation here's the Goldilocks scenario we kill inflation owner's equivalent rents come down sticky Services come down we kill inflation we have no recession or a very shallow recession businesses and consumers spend through the recession yes you have a little bit of hit on Staples and discretionaries expected but it's minor and then what do you do you come out on the other side with companies that are much more lean and efficient now and able to create more profits in other words and taxpayers don't end up fronting any losses to the banking sector so in other words as this bubble is deflating the conditions are present to where we could actually just reinflate the bubble and go back to the Moon which is kind of scary and crazy you'd think we'd have to go through some more pain but the government right now is doing a really good job of making sure that nobody can fail no failures socialists no failures nobody's allowed to fail but hey as somebody who's invested in stocks maybe I'm biased to the upside and hopefully that's what happens but I think TS Lombard makes a good point that we have yet to see how this asset tightening cycle which is being evidenced by the bank failures will end up affecting earnings I think it's funny that somebody here in the comments says employees and investors didn't get bailed out by the Banks uh yes they did first of all employees got bailed out and maybe investors didn't but employees did they all got a 50 pay bump paid for by the FDIC to stay with the bank for another 45 days yes they're gonna have to find another job but let's be real they got bailed out too so the idea that well not everybody got bailed out somehow makes this time different is nonsense it's a bailout let's be real about that it is a bail out suggesting it's not a bailout in my opinion is is just it's a Looney Tune it's an absolute Looney Tune it's a bailout it's very simple the taxpayer will foot the bill uh if uh there's any loss the taxpayer pays for it in fact the taxpayer already paid for those salaries for example uh because of the Appropriations that set up this facility in the first place Congress took taxpayer money and stuck it into a fund that we're now using to bail everyone out yeah somebody here says it's bailout light yeah it's a diet bailout there you go
Comments 0