Most people don't realize how crucial Silicon Valley Bank is.
Billions of dollars in venture debt. Untold amounts of warrants and convertible notes in early-stage firms.
If SVB fails, this could be the Lehman moment for the startup world.
Bank run on SVB might be kicking off.
The one thing you DON'T DO as a bank CEO is telling everyone,
"We'll be fine, just don't pull out your money"
I've worked with SVB through my job. they fund a huge amount of startups in the United States- and have their tentacles in basically every large VC and PE fund out there.
Most of you have never heard of them, but in the startup world, they are huge.
The real risk is SVB is essentially a commercial bank- thousands of startups hold cash reserves at Silicon Valley Bank.
Provisions for Credit losses in 2022 were 3x as high as prior years. Management was getting worried.
AOCI figure was $1.9B as of year end 2022.
AOCI is the proxy for unrealized gains or losses on investment securities:
looks like mostly fixed income- they were holding a ton of Treasury and MBS paper going into 2022
they held $14B in Fed deposits and government debt as of YE 2022... Losing $1.8-$1.9B is a huge chunk of that
average yield achieved on these securities was 1.44%- likely they acquired most before or during covid when rates were extremely low
They have 2.3B in cash while total liabilities are 195B and customer deposits are 173B... putting reserve ratio at 0.01329479769
wow they have $13B of cash and cash equivalents, but as we can see on page 49 the only actual interest-bearing cash they have at the Fed and other commercial banks is 2.3B.
Like most banks, they call Treasury securities "cash equivalents"
looks like even though provisions for credit losses increased dramatically they still INCREASED net loans in 2022 from $65B to $73B
looks like this was likely due to greed. they made more in interest income in 2022 due to higher rates they were charging on venture debt
Statement of cash flows shows despite the bond market bloodbath in 2022 they continued investing MORE into AFS and HTM securities
for reference, AFS means Available for Sale and HTM is Held to Maturity...
these are all debt instruments, they appear to differentiate them based on what their intent is. Likely the Treasuries were held to maturity and mortgage backed securities, ABS, CMBS, and other types of… twitter.com/i/web/status/1…
WAIT THEY ASSUME THE CREDIT RISK FOR SOME OF THEIR HTM SECURITIES TO BE 0??
so all the MBS they bought they had no risk management or buffers in case this lost value? Are you fucking kidding me?
they are deep in MBS and CMBS across the spectrum. they even hold variable-rate collateralized mortgage obligations
fucking hell- they barely even invest in startups. looks like only $605M in private equity from startups and $14B in Agency issued CMBS
jesus. they hold $117.39 Billion in MBS, CMBS, Treasuries, ABS, CMO, Corporate bonds, Muni Bonds- and only $2.664B in equity valued securities (actual shares in startups, this is very illiquid)....
they're essentially plowing everything they have into debt instruments.
only 0.02219001449 , or 2% of all investment assets is in startups
$57 BILLION in residential MBS
all that for a drop of blood.
1.33-1.89% weighted average yield.
variable rate CMO yielding half of other CMO
here's what a CMO is. Jesus christ do we learn NOTHING from '08 ??!!
The Dollar Index has crashed to its lowest level since April 2022, and bears are celebrating the oncoming collapse of the greenback. Little do they know, this only makes the system stronger- and changes the nature of the Endgame.
A THREAD 🧵
This month, amid chaotic trade policy moves and volatile global markets, the DXY (Dollar Index) has weakened considerably. The drop is mostly being driven by ongoing trade tensions with China, where both countries have imposed heavy tariffs on each other.
Since the beginning of 2025, the DXY has fallen about 8.3%, and this latest dip below the 100 mark is the steepest slide we’ve seen in years. Right now, the dollar is clearly under pressure, and people are watching closely to see what happens next.
Is it due to tariffs? Liquidity? Or something else?
A THREAD 🧵
Last week, the Trump admin announced a massive escalation in their tariff policy, making new moves to end the decades-long trend of globalization of labor and offshoring of manufacturing to third world countries.
Effective April 5, 2025, at 12:01 a.m. EDT, a baseline tariff of 10% has been imposed on ALL imported goods into the United States- this one has already taken effect!
2. Reciprocal Tariffs on Specific Countries:
Starting April 9, 2025, at 12:01 a.m. EDT, higher individualized tariffs, termed "reciprocal tariffs," are being applied to countries with which the U.S. has significant trade deficits. These tariffs are in ADDITION to the universal 10% tariff. (See a list of reciprocal tariffs in the tweets above)
Some examples are:
European Union imports: Subject to an additional 20% tariff.
Japanese imports: Subject to an additional 26% tariff.
Chinese imports: Subject to an additional 34% tariff.
3. Tariffs on Countries Importing Venezuelan Oil:
A 25% tariff has been imposed on all goods imported from any country that purchases oil or gas from Venezuela. Basically this aims to put further pressure on the Maduro admin by penalizing countries that trade with the Latin American country.
4. Additional Tariffs on Specific Products:
The administration has announced plans for further tariffs targeting specific products, including:
Automobiles:
A 25% tariff on auto imports.
Steel and Aluminum:
Expanded trade penalties on these materials. (TBD)
Pharmaceutical Drugs, Lumber, Copper, and Computer Chips:
Separate import taxes are planned for these products.
@OnrampBitcoin The bitcoin price has retraced a bit after collapsing to $92K then rocketing back to $100K in the aftermath of the mini trade war Trump waged last weekend
@OnrampBitcoin The Crypto Greed and Fear index is back in Neutral territory after briefly hitting Greed on Tuesday as Bitcoin rallied to over $100K
The year has barely begun and multiple currencies are crashing as DXY rises once again. What happens when the Dollar Milkshake returns to claim more victims?
A THREAD: 🧵👇
In September 2022, I published a viral piece online entitled “The Sword of Damocles and the Dollar Milkshake” where I discussed the growing crisis in the British Pound and the Japanese Yen, which had both slid to historic lows against the Dollar.
On September 22 of that year, the Japanese government and BOJ intervened for the first time in nearly a quarter century, selling dollars and buying yen, after the yen had weakened by about 25 yen in six months, briefly hitting 145 per dollar.
@OnrampBitcoin Bitcoin soared in the first half of the month, reaching $108K before falling back down into the 90s after the FOMC conference.
@OnrampBitcoin Market participants had largely been expecting a strong dovish stance by the Fed and instead were surprised when the dot plot was released which showed the majority of governors only expected 2 rate cuts for all of 2025 and 2 for 2026.
Killer is Luigi Mangione, Ivy League grad with degrees in comp sci, avid reader and active contributor on GitHub.
He has a 130+ IQ but he takes off his mask at a Starbucks to flirt with an employee, then an hour later goes and calmly kills the CEO of a major healthcare company, rides away on a bike.
A week later goes to a local McDonalds where he brings the murder weapon, the fake ID he used to check into a hotel, and a written manifesto on how horrible the American healthcare system is. He somehow gets identified by the cashier after he sits down.
He works on his laptop until police come inside the McDonalds, sitting there with a ghost gun and suppressor he made himself.
Gotcha.
He goes to a park and ditches a backpack full of Monopoly money but not the murder weapon???
Plus, the backpack straps in the photo are different color than the backpack straps from the killing of Brian Thompson ..