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9dashline

9dashline

Captain
Registered Member
siegecrossbow said:
Startups will die if they don't get their cash within a few months though.
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Roku got hit hard, slumberkins lost most of their money, too. they are having a fire sale to try to make some quick cash. Some of these startups couldnt even make payroll on Friday.... the ripple affects already in place will reverberate through the tech sector ... and I bet good money this wont be just these two banks that go under... the interest rate thing is structurally systemtic... America never recovered from 2008, just kicked can down the road... when they couldnt anymore after a decade of kicking then "some people did some thing" cough cough and as China's US hegemony paper clarified, America printed most of its fake paper money during covid.... now the chickens are coming home to roost and China isnt going to help save USA again this time... so its game over, SVB was just the tip of the iceberg to use a Titanic analogy, and in similiar parlance, in a year, two at the most, the USD will be at the bottle of the Pacific... that is, as they say, a mathematical certainty. I would say you can take this prediction to the bank but by then there might not even be one left
 
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G

gelgoog

Lieutenant General
Registered Member
Patchwork_Chimera said:
We can see this most evidently in our attitude towards BRI. China has been successfully coupling itself to smaller economies, providing infrastructure and capital for lesser-developed nations, and broadly enhancing its global prestige in the process. Instead of acknowledging this fact and coming up with a better alternative for these nations, we decried it as "debt trap diplomacy" and "neocolonialism," making CN out to be an untrustworthy, predatory entity.
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China ran into the same problems Japan did in the late 1980s early 1990s. Most of their infrastructure boom had already ended and they had huge amounts of capital to invest while a lot of their construction companies were idle. So they basically started all sorts of loan schemes for infrastructure construction basically everywhere they could.

Japan also had similar plans to invest in Asia back at their peak. Japan provided most of the funding for the Asian Development Bank when it started in the late 1960s. And Japan built the HSR in Taiwan in the late 1990s. They had planned to invest in building the Kra canal in Thailand. They also planned investments into Malaysia and Indonesia at the time. When the Japanese economy imploded in the mid 1990s most of those programs were curtailed.

China went much the same route by creating the Asian Infrastructure Investment Bank and doing the BRI investment program.
 
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FriedButter

FriedButter

Colonel
Registered Member
Overbom said:
No. SVB assets to deposits ratio was about 1. So their assets can cover their deposits.

The problem is that it will take time to convert these assets to hard cash. And that's what's the problem here. While the regulators try and sell all these assets, all these startup companies need access to their money now (not a year/s later), otherwise they will have to close shop or go to fundraise from their investors again..
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I heard that apparently 3/4 of biotech IPOs were banking with SVB. If true then that already sounds like a train wreck for drug development in the short term. Rather unfortunate.
 
K

KYli

Brigadier
FDIC could still sell some of SVB's treasures at a loss to distribute tens of billions to those startups. But not sure how much of those more liquid assets are available since SVB has already sold some at huge loss to provide liquidity in the last few weeks.

Some estimates that SVB would take 15 billion realized losses by selling treasures. Most other assets are loans to venture firms which would probably sell at pennies on the dollars.

I think the bigger problem would be a blown up in Cypto and other startups and banks that got involved too deeply into such two sectors. Many Cypto companies are living in borrowing time by rolling over debts and hoping for suckers to jump back in. In the end of the day, all of these messes are due to the massive 9 trillions balance sheet of the Fed and the prolong period of zero interest rate and a few trillions dollars of multi-years debt fueled spending by both Trump and Biden administration.
 
C

Chevalier

Captain
Registered Member
FriedButter said:
I heard that apparently 3/4 of biotech IPOs were banking with SVB. If true then that already sounds like a train wreck for drug development in the short term. Rather unfortunate.
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Time for Chinese tech and biotech companies to start poaching talent and IP. This is, after all, how a free market works right? Or are the anglos gonna cry when faced with competition?
siegecrossbow said:
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you’ll see now how unstable western liberal democracies really are, absent a proper social security system. America only functions from the loot and plunder of the rest of the world, typical of feudal societies.

a good analysis by former Indian diplomat bhadrakumar
The stunning part here is the sheer brain power and intellectual resources and ‘soft power’ that China has brought into play to outwit the US. The US has at least 30 military bases in West Asia — five in Saudi Arabia alone — but it has lost the mantle of leadership. Come to think of it, Saudi Arabia, Iran and China made their landmark announcement on the very same day Xi Jinping got elected for a third term as president.

What we are seeing is a new China under the leadership of Xi Jinping trotting over the high knoll. Yet, it is adopting a self-effacing posture claiming no laurels for itself. There is no sign of the ‘Middle Kingdom syndrome,’ which the US propagandists had warned against.

On the contrary, for the world audience — especially countries like India or Vietnam, Turkey, Brazil or South Africa — China has presented a salutary example of how a democratised multipolar world can work in future — how it is possible to anchor big power diplomacy on consensual, conciliatory politics, trade and interdependence and advance a ‘win-win’ outcome.
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