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Reasons the banking crisis isn’t a repeat of 2008

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

#111

Post by dragonwriter »

fyzix wrote: post #104
zoltar wrote: post #63

Earlier quoted context omitted.

Is that the same Peter Schiff that said gold was going to $5,000/oz in 2012?

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.

Literally every economic misprediction can be blamed on not accounting for the way people actually behave in real-world economies, but…that’s not something that adds credibility for the next prediction by the same predictor.

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

#112

Post by paulpauper »

fyzix wrote: post #104
zoltar wrote: post #63

Earlier quoted context omitted.

Is that the same Peter Schiff that said gold was going to $5,000/oz in 2012?

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?

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

#113

Post by fyzix »

Dalewyn wrote: post #80
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…

>bailing out the banks My understanding this time around is the depositors rightfully got bailed out (both to maintain peoples' trust in banking, and because losing your money to others' failures fucking sucks), but the banks themselves were left out to dry.

By "banks", I mean 90% of the other banks in the country that would've failed, absent the SVB depositor bailout.

If the FED didn't step in, every regional bank in the country would experience a bank run as people would withdraw everything and deposit in the "too big to fail" banks for safety.

Why I think the depositors should've suffered a haircut: What the FED did, was implicitly guarantee the deposits, this incentivize banks to become even riskier with deposits as they get to keep the profits if their risky bets payoff and get bailed out if they fail. This is like a real life cheat code for bankers and unfair to the rest of us regular folks who has to suffer the consequences of our actions.

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

#114

Post by fsckboy »

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…

> Peter Schiff predicted this

if Peter Schiff was any good at predicting this type of stuff, Peter Schiff wouldn't have to work for a living.

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

#115

Post by Retric »

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.

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

#116

Post by bigdaddyrabbit2 »

fyzix wrote: post #113
Dalewyn wrote: post #80

Earlier quoted context omitted.

>bailing out the banks My understanding this time around is the depositors rightfully got bailed out (both to maintain peoples' trust in banking, and because losing your money to others' failures fucking sucks), but the banks themselves were left out to dry.

By "banks", I mean 90% of the other banks in the country that would've failed, absent the SVB depositor bailout. If the FED didn't step in, every regional bank in the country would experience a bank run as people would withdraw everything and deposit in the "too big to fail" banks for safety. Why I think the depositors should've suffered a haircut: What the FED did, was implicitly guarantee the deposits, this incenti…

>banks to become even riskier with deposits as they get to keep the profits if their risky bets payoff and get bailed out if they fail

This isn't true, is it? While they do get to keep profits, if the bets don't pay off, the bankers - shareholders, bondholders, employees, executives - all get wiped out (as happened with SI, Signature and SVB). The depositors get bailed out.

They get to keep profits if they win, but lose everything if they don't. No moral hazard, right?

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

#117

Post by fyzix »

paulpauper wrote: post #107
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…

Peter Schiff predicted this from the moment the fed bailouted the banks in 2008. He predicted dollar collapse, hyperinflation for 11 years, and a bunch of other stuff the didn't come true. Major broken clock syndrome on his part. Inflation finally spiked, but after being wrong since 2008. Gold still has not done much in a decade. The inflation was from the post-covid recovery, which was so strong that supply chain co…

It's better to be wrong until you're right than right until you're wrong...because you will get the last laugh.

The fundamental problem is that price controls never work and the interest rate is the price of money. If you understand this, then it's easy to predict the endgame, whether it takes 10 or 20 yrs to fail, you will still be right once you position yourself for the windfall.

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

#118

Post by humanizersequel »

fsckboy wrote: post #114
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…

> Peter Schiff predicted this if Peter Schiff was any good at predicting this type of stuff, Peter Schiff wouldn't have to work for a living.

The internet seems to think he has a net worth in the ballpark of 70 million dollars — I don't think he does.

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

#119

Post by [deleted] »

arcticbull wrote: post #91
alxmng wrote: post #87

Who cares about keeping deposits safe when money isn’t worth anything? Americans don’t even have money in the bank. Median savings is $4500. Many people who perform socially useful jobs can barely afford the basic basket of goods like rent, food, and transportation.

My money still seems to work great. Those are some serious fiscal and social (but not monetary) issues that should be taken up with Congress not the Fed, and not the FDIC. Who handled this all very well I might add. > Median savings is $4500. The average American family has a $748,000 net worth, according to Federal Reserve data, median $121,000. Savings isn't just what's in your 'savings' account. Mine definitely is…

[deleted]

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

#120

Post by fyzix »

bigdaddyrabbit2 wrote: post #116
fyzix wrote: post #113

Earlier quoted context omitted.

By "banks", I mean 90% of the other banks in the country that would've failed, absent the SVB depositor bailout. If the FED didn't step in, every regional bank in the country would experience a bank run as people would withdraw everything and deposit in the "too big to fail" banks for safety. Why I think the depositors should've suffered a haircut: What the FED did, was implicitly guarantee the deposits, this incenti…

>banks to become even riskier with deposits as they get to keep the profits if their risky bets payoff and get bailed out if they fail This isn't true, is it? While they do get to keep profits, if the bets don't pay off, the bankers - shareholders, bondholders, employees, executives - all get wiped out (as happened with SI, Signature and SVB). The depositors get bailed out. They get to keep profits if they win, but l…

> as happened with SI, Signature and SVB

I concur...While this might be true for smaller banks, the same cannot be said about the "too big to fail" banks.

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