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

Bank Failures Visualized

observablehq.com

Post reply on HN
Print view View original

161–170 of 424 posts

Re: Bank Failures Visualized

#161

Post by p-e-w »

bobbylarrybobby wrote: post #110
kypro wrote: post #79

Would be slightly more insightful if it was inflation adjusted. The circles on the right should be ~30% smaller.

And if the circles’ areas, not their radii, were the failed assets. As it is, a circle’s apparent size (we judge 2D shapes by their area, not any one linear dimension — although this is difficult to do in practice, and linear marks are generally superior) is the failure size squared , which distorts the data a boatload. Here is a, er, more faithful representation of the data. The recent failures don't look quite so c…

> we judge 2D shapes by their area

I've seen this claim a few times in discussions about such charts, but it's far from obvious to me that this is really true. My best guess based on my own perception is that we estimate quantities represented by circles as proportional to something between the diameter and the area.

Re: Bank Failures Visualized

#162

Post by foota »

hibikir wrote: post #136
foota wrote: post #92

Earlier quoted context omitted.

The only safe investment is a hedged investment, antthing else is up to your priors. While interest rates going up as much as they did may have seemed unlikely, it was still irresponsible not to hedge their risk.

Not even most hedged investments at large scales. Hedging doesn't make risk disappear: It just shifts it somewhere else, either to someone even larger, or dispersed among many parties. When the risk is correlated with the risk from others, like the trillions in underperforming treasuries that the bing banks have in their balance sheets, who is the safe counterparty? Not the next bank, which also has a similar positio…

I'm not an expert on interest rate securities, but with e.g., physical goods the bag holder has physical goods or contracts for supply that allows them to meet their obligations.

Is something similar not possible with interest rates? I imagine for instance someone with lots of cash and little desire for risk could lend their money to the banks at overnight rates, collect the interest, and then offer swaps against that steam, no? Of course, no one's going to get their 10th mansion off of this. A little riskier, someone holding variable payment debts could do the same, as long as the loans are diverse the risk could stay low. In this way, the risk at least shifts from "we're screwed if interest rates change" to "we're screwed if interest rates change and many diverse loans start to fail to make payments" in which case you're probably screwed regardless.

Re: Bank Failures Visualized

#163

Post by alanbernstein »

p-e-w wrote: post #161
bobbylarrybobby wrote: post #110

Earlier quoted context omitted.

And if the circles’ areas, not their radii, were the failed assets. As it is, a circle’s apparent size (we judge 2D shapes by their area, not any one linear dimension — although this is difficult to do in practice, and linear marks are generally superior) is the failure size squared , which distorts the data a boatload. Here is a, er, more faithful representation of the data. The recent failures don't look quite so c…

> we judge 2D shapes by their area I've seen this claim a few times in discussions about such charts, but it's far from obvious to me that this is really true. My best guess based on my own perception is that we estimate quantities represented by circles as proportional to something between the diameter and the area.

Wouldn't that be even worse for interpretability?

Re: Bank Failures Visualized

#164

Post by zamnos »

lazide wrote: post #138
zamnos wrote: post #112

Earlier quoted context omitted.

Cash sweep products are a thing. For example, Wealthfront will sweep your cash into a bunch of smaller banks, putting 250k in each, so on the off chance they fail, your money's not been disappeared.

The last time anything like that happened was what, over a decade ago? People forget (for real). Also, no one seems to have lost a dollars yet in this crisis (on the depositor side), so hard to say anyone ‘lost’ this time either.

Doral Bank failed in 2015, so 8 years? Not quite 10. The GFC was 2008 which was 15 years ago though but people still remember that one.

Even though the FDIC chose to make depositors whole for SVB, Signature, and FRC, there's no written legal guarantee that they'll keep doing this, so in the face of that, I don't think people are forgetting the $250k FDIC limit.

Anyway, my point is no one's walking up and down Main St with their $10 million and opening 40 different bank accounts by hand because the finance industry invented a product (prior to SVB, even) so no one has to do that.

Re: Bank Failures Visualized

#166

Post by RC_ITR »

p-e-w wrote: post #161
bobbylarrybobby wrote: post #110

Earlier quoted context omitted.

And if the circles’ areas, not their radii, were the failed assets. As it is, a circle’s apparent size (we judge 2D shapes by their area, not any one linear dimension — although this is difficult to do in practice, and linear marks are generally superior) is the failure size squared , which distorts the data a boatload. Here is a, er, more faithful representation of the data. The recent failures don't look quite so c…

> we judge 2D shapes by their area I've seen this claim a few times in discussions about such charts, but it's far from obvious to me that this is really true. My best guess based on my own perception is that we estimate quantities represented by circles as proportional to something between the diameter and the area.

Well is the unit is the diameter, then why add extra dimensionality at all then?

That’s literally what bar charts are for.

I can feel a Tufte monologue coming on, even.

Re: Bank Failures Visualized

#167

Post by RC_ITR »

bboygravity wrote: post #42
themagician wrote: post #10

Earlier quoted context omitted.

I have faith that we can top S&L. We have the technology. We have the talent. There are six banks with over a trillion in assets in the US. I have faith that one of them has been doing some wild book cooking. I'd place a bet on Citibank, followed by Wells Fargo. There's an old saying in Tennessee — I know it's in Texas, probably in Tennessee — that says, fool me once, shame on… shame on you. Fool me… you can't get fo…

JP Morgan is the biggest one. It can do ANYTHING it wants and get away with it. It can make 10 billion USD spoofing gold prices for a decade and get away with a 1 billion USD fine (and keep doing it) for example. The CEO can go on trips with Jeffrey Epstein, be friends with him and do business with him and get away with it. It made tons of money off of the Madoff ponzi by providing Madoff with a bank account and not…

> There are 100's of other examples of quite outrageous FTX-style crime.

Woah woah woah. FTX (in the most generous telling) didn’t even have its own bank account.

Let’s not conflate that with not proactively reaching out to snitch on a customer (as if they are some regulatory agency).

Re: Bank Failures Visualized

#168

Post by RC_ITR »

yieldcrv wrote: post #20
themagician wrote: post #10

Earlier quoted context omitted.

I have faith that we can top S&L. We have the technology. We have the talent. There are six banks with over a trillion in assets in the US. I have faith that one of them has been doing some wild book cooking. I'd place a bet on Citibank, followed by Wells Fargo. There's an old saying in Tennessee — I know it's in Texas, probably in Tennessee — that says, fool me once, shame on… shame on you. Fool me… you can't get fo…

If you like absurdity, FTX has recovered 7.3 billion out of the 8.6 billion hole and plans on relaunching the exchange to make the last billions back in fees Most noteworthy is that this quick 8 month turnaround is partially thanks to the blockchain, and under no new laws being passed

> Most noteworthy is that this quick 8 month turnaround is partially thanks to the blockchain

What are the specific examples of this that are intrinsic to crypto and not any digital transaction?

Re: Bank Failures Visualized

#169

Post by rerdavies »

mbo wrote: post #119
bobbylarrybobby wrote: post #110

Earlier quoted context omitted.

And if the circles’ areas, not their radii, were the failed assets. As it is, a circle’s apparent size (we judge 2D shapes by their area, not any one linear dimension — although this is difficult to do in practice, and linear marks are generally superior) is the failure size squared , which distorts the data a boatload. Here is a, er, more faithful representation of the data. The recent failures don't look quite so c…

I have also built an alternative as a stacked bar chart https://observablehq.com/@mjbo/bank-failures-as-a-stacked-ba...

The circle version is terrifying. The stacked bar chart is even more terrifying.

Re: Bank Failures Visualized

#170

Post by RC_ITR »

yieldcrv wrote: post #159
lottin wrote: post #151

Earlier quoted context omitted.

How is any of this partially thanks to the blockchain?

because the clawbacks are easier to track through multiple hops, even when the initial recipient had already done other things with the funds

What does that have to do with decentralized consensus?

You know, the core differentiating feature of cryptocurrency.

Post reply on HN