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Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

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Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#211

Post by zrail »

SecretDreams wrote: post #203
zrail wrote: post #145

Earlier quoted context omitted.

> in 55 failures since IndyMac of banks with total deposits over $1 billion, uninsured deposits were fully protected against any loss. The largest failure, Colonial Bank, had $20 billion of deposits, including an estimated $4.4 billion of uninsured deposits. https://www.cato.org/commentary/fdic-invents-costly-solution...

Meanwhile, svb had north of 160bik deposits with an estimated 93% uninsured. Scope is a bit different.

The article goes on to note that when FDIC wound up Wachovia in 2008 there were $130Bil in uninsured deposits and all of them were made whole.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#212

Post by soundsgoodtome »

carstenhag wrote: post #50
iammiles wrote: post #15

To save people a quick search, here is part of the Wikipedia definition of Form 8-K: "...a very broad form used to notify investors in United States public companies of specified events that may be important to shareholders or the United States Securities and Exchange Commission."

And SVB means Silicon Valley Bank, which was shut down by a regulatory body some days ago: https://www.cnbc.com/2023/03/10/silicon-valley-investors-and... (seriously HN, we non-US people have never heard of your terms)

Sounds like you should get up to date on US terms then, since they’re what matter.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#213

Post by nielsinho »

soundsgoodtome wrote: post #212
carstenhag wrote: post #50

Earlier quoted context omitted.

And SVB means Silicon Valley Bank, which was shut down by a regulatory body some days ago: https://www.cnbc.com/2023/03/10/silicon-valley-investors-and... (seriously HN, we non-US people have never heard of your terms)

Sounds like you should get up to date on US terms then, since they’re what matter.

Tissemand.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#214

Post by BearOso »

tylerrobinson wrote: post #171
BearOso wrote: post #161

Earlier quoted context omitted.

We're in a semi-fraudulent housing bubble now. Well, maybe not fraudulent, but unethical, and similar to what was going on in the '00s. Big banks are holding onto large, mostly unoccupied housing developments to create artificial scarcity and drive the prices up. Then they're selling with huge loans to buyers that are going to see value plummet and be unable to pay anything back.

> Big banks are holding onto large, mostly unoccupied housing developments to create artificial scarcity and drive the prices up. I’m assuming you’re talking about the US. Do you have a source for this claim? There is a problem with vacant houses, but this is the first I’ve heard of the narrative of empty developments implying new houses. A discussion of vacant housing: https://www.pewtrusts.org/en/research-and-analy…

I can only speak anecdotally and assume it's happening everywhere. I'm in the Midwest US. Banks themselves are building neighborhoods full of spec houses. Half of them go empty because they're overpriced. A bunch of developments have stopped before being completely finished, presumably because they can't put up for sale in that condition, but they still contribute to the bank's assets.

I can't say I understand the whole economics of it, but it's obvious something sketchy is happening.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#215

Post by IrnBru »

mmart wrote: post #202
paxys wrote: post #190

Earlier quoted context omitted.

You are making the assumption that that $1 in a company's checking account corresponds to $1 of their market cap, which is not even remotely the case. A much more believable hypothesis is that investors saw the headline, went "Roku is affected by SVB!!" and panic sold.

I was under the impression that, at least to a first order, $1 in cash in a company's checking account (money that could be immediately released to shareholders) does correspond to $1 of their market cap (MC=EV-Debt+Cash [1]). Why do you think this is not the case here? [1] https://corporatefinanceinstitute.com/resources/valuation/en...

Because that isn't a physical law.. it's a metric.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#216

Post by samstave »

belltaco wrote: post #102
saurik wrote: post #68

Earlier quoted context omitted.

How paranoid would you have to get before you'd be willing to convert all your money to crypto? ;P

Silvergate bank which is THE bank for crypto companies failed a few days ago on the same day that SVB was trying to raise capital to plug losses. The after effects of that are still unknown.

What are some speculations on the scenarios that might play out based on this?

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#217

Post by lordentropy »

athinggoingon wrote: post #110
lordentropy wrote: post #105

Money is just a number on the ledger for the government. They can just give back everyone's deposits or maybe wait for a few months until it becomes a major crisis and then bail out everyone. The investors and shareholders of SVB are going to lose everything, but the depositors will be fine.

Except that's what the Fed is trying to correct. Inflation is caused when the money supply in an economy grows at faster rate than the economy's ability to produce goods and services.

Not sure why I got down-voted, but what I said just happened - https://home.treasury.gov/news/press-releases/jy1337. The depositors will be made whole.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#218

Post by notch898a »

boeingUH60 wrote: post #81
notch898a wrote: post #70

Earlier quoted context omitted.

The US Government is the people of the US. They went over the 250k limit. If they don't have private insurance for that, fuck them they're on their own. Not big enough to bail out, the regular people didn't get it either in the great recession.

And of course, the FDIC is not guaranteeing deposits of over $250k. What's actually happening is that the FDIC will take care of the sub-$250k deposits by itself and sell the remaining assets of Silicon Valley Bank (which they have taken over) to sort out the remaining uninsured deposits.

>And of course, the FDIC is not guaranteeing deposits of over $250k

FDIC says they are.

  After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13.
https://home.treasury.gov/news/press-releases/jy1337

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#219

Post by phkahler »

rpeden wrote: post #112
phkahler wrote: post #100

Earlier quoted context omitted.

They don't create money, they loan out deposits. It's not as scammy as people think. You are free to put your cash in a mattress instead.

Sure, but loaning out deposits creates money, does it not? Most of that loaned out money is getting deposited into another bank account. And that deposited loan will (minus a percentage kept in reserve) get loaned out again. And so on, etc. I might be missing something important, though.

>> Sure, but loaning out deposits creates money, does it not?

No. It moves it to someone else and creates a debt. It needs to be paid back.

Re: Roku filed an 8-K saying that of its $1.9B of cash, $487M is stuck at SVB

#220

Post by phkahler »

hughw wrote: post #111
phkahler wrote: post #100

Earlier quoted context omitted.

They don't create money, they loan out deposits. It's not as scammy as people think. You are free to put your cash in a mattress instead.

The create money by loaning out many times the amount of deposits they have.

No. Less than their total deposires. But loaned money may well end up in a bank where it might be loaned out again. But it's not IMHO right to try to claim one deposite as somehow "the first one" that gets loaned out repeatedly. Each deposit is loaned out less than 100 percent.

The bottom line is that not all deposited money is not readily available on short notice.

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