Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Reasons the banking crisis isn’t a repeat of 2008

chase.com

Post reply on HN
Print view View original

131–140 of 441 posts

Re: Reasons the banking crisis isn’t a repeat of 2008

#131

Post by fyzix »

paulpauper wrote: post #112
fyzix wrote: post #104

Earlier quoted context omitted.

Schiff didn't account for the economic ignorance of the masses in his prediction. He understood that runaway inflation would cause the gold price to spike, he didn't foresee the confidence that traders have in the FED to fight off inflation. The FED cannot win the inflation fight (confirmed by their recent soft pivot back to QE) and gold will not go up until the traders realize this fact.

Schiff didn't account for the economic ignorance of the masses in his prediction. If he is as smart or knowledgeable as he claims or held up to be, then he should have factored that into his forecast and advice. IF the fed is going to do everything in its power to save the economy, why fight it?

>IF the fed is going to do everything in its power to save the economy, why fight it?

This is a popular sentiment among traders...why fight the FED? Because there is nothing they can do to bring inflation back to 2%. They all but admitted this with their return to QE. When the masses realize this...gold will surge.

Re: Reasons the banking crisis isn’t a repeat of 2008

#132

Post by fells »

hayst4ck wrote: post #129

The primary function of central banks isn’t managing inflation and employment, it is acting as a lender of last resort. In this way, central banks provide the bedrock for the banking system. The Fed’s ability to perform this role expanded during the Global Financial Crisis. They created many different types of lending facilities to provide liquidity to banks, and many former broker-dealers (like Morgan Stanley and Go…

The fed doesn't have access to taxpayer money.

Re: Reasons the banking crisis isn’t a repeat of 2008

#133

Post by hayst4ck »

fells wrote: post #132
hayst4ck wrote: post #129

The primary function of central banks isn’t managing inflation and employment, it is acting as a lender of last resort. In this way, central banks provide the bedrock for the banking system. The Fed’s ability to perform this role expanded during the Global Financial Crisis. They created many different types of lending facilities to provide liquidity to banks, and many former broker-dealers (like Morgan Stanley and Go…

The fed doesn't have access to taxpayer money.

Does that mean that instead of giving taxpayer money, they instead devalue all taxpayer money by inventing new money?

Re: Reasons the banking crisis isn’t a repeat of 2008

#134

Post by heavyset_go »

oblio wrote: post #74
chiefalchemist wrote: post #71

Earlier quoted context omitted.

> The fucking owners of capital seem bound and determined to destroy their own system. Nah. These disruptions are a means to an ends. That is, shifting still more wealth to the top. Follow that graph. Everything else is a means to that ends or a distraction.

I hate all these conspiracy theories. And you know why? It's because they imply hubris, arrogance, control. Let's just realize that we all have a lot less control over our environment than we think we do, and some things are just forces beyond anyone's control.

The business cycle isn't a conspiracy theory.

Re: Reasons the banking crisis isn’t a repeat of 2008

#135

Post by olalonde »

hayst4ck wrote: post #129

The primary function of central banks isn’t managing inflation and employment, it is acting as a lender of last resort. In this way, central banks provide the bedrock for the banking system. The Fed’s ability to perform this role expanded during the Global Financial Crisis. They created many different types of lending facilities to provide liquidity to banks, and many former broker-dealers (like Morgan Stanley and Go…

It amuses me when people sometimes blame capitalism for bank failures, considering that banks are essentially governmental institutions with extra-steps. They're literally encouraged to engage in practices, such as fractional-reserve banking, which would be considered fraudulent or a scam in any other context. And to add insult to injury, they get bailed out when they lose their risky bets.

Re: Reasons the banking crisis isn’t a repeat of 2008

#136

Post by zx8080 »

hayst4ck wrote: post #133
fells wrote: post #132

Earlier quoted context omitted.

The fed doesn't have access to taxpayer money.

Does that mean that instead of giving taxpayer money, they instead devalue all taxpayer money by inventing new money?

True. There's option to export a newly created inflation to other countries, at least partially. Thus, steal from other countries' citizens and taxpayers.

Re: Reasons the banking crisis isn’t a repeat of 2008

#137

Post by mullingitover »

hayst4ck wrote: post #133
fells wrote: post #132

Earlier quoted context omitted.

The fed doesn't have access to taxpayer money.

Does that mean that instead of giving taxpayer money, they instead devalue all taxpayer money by inventing new money?

Honestly, it's a good thing. Given how dysfunctional the legislative branch is with fiscal policy I can't imagine a worse idea than putting it in charge of monetary policy as well.

Re: Reasons the banking crisis isn’t a repeat of 2008

#139

Post by juniordev7 »

fyzix wrote: post #23

History never repeats itself, but it does often rhyme. We cannot have a decade of 0% interest rates and expect no consequences. Peter Schiff predicted this from the moment the fed bailouted the banks in 2008. There's nothing the fed can do to escape this one, it's either massive inflation or massive recession. The fed has avoided the latter by bailing out the banks again so expect double digit inflation for the next…

[flagged]

Re: Reasons the banking crisis isn’t a repeat of 2008

#140

Post by fuoqi »

Retric wrote: post #115
treebeard901 wrote: post #101

In 2008, the Treasury and Federal Reserve had a ton of ammo to use to provide liquidity. Since then, they have tried to inflate their way out of it using creative accounting and quantitative easing. The reason this could be worse than 2008 is that those methods will not work as well. Part of the reason SVB failed so fast was because they held a lot of long term government debt, mortgages etc. When they tried to sell…

Banks don’t have nearly as many worthless assets today as they did in 2008, which completely changes the underlying economics. As long as they aren’t offering higher returns than their existing investments can support, the only thing they have to fear is bank runs.

SVB also did not have "worthless assets", but the extreme rate hikes by the Fed significantly reduced its value. Wait until tightness of credit conditions will cause chain of defaults and we will see how well banks will fare. We already see the first signs of it in the auto loans market.
Post reply on HN