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Bank Failures Visualized

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Re: Bank Failures Visualized

#291

Post by JoeAltmaier »

haldujai wrote: post #135
JoeAltmaier wrote: post #99

Yes, yes, inflation changes things (a little) but the glaring result is, these bank failures are massive, significant and unprecedented. We can find historical failures of adjacent institutions but clearly something new is happening?

If two regional banks failing with little realized loss is massive and unprecedented how would you describe 2007-2008 when the entire world economy was brought to its knees with napkin math ~1.2T of bailouts/failures in the US let alone Europe with several banks nationalized (e.g. UBS and RBS) and nation states defaulting on debt?

From the linked graph, recent bank failures of this kind rival that entire event. And we're probably not done.

Re: Bank Failures Visualized

#292

Post by majormajor »

_heimdall wrote: post #242
jeremyjh wrote: post #74

Earlier quoted context omitted.

FDIC premiums are not payed by taxpayers. What we're visualizing here are bank failures assumed by FDIC. The too big to fail banks didn't technically fail, but to give an accurate picture of a financial crisis they should be on the graph.

> FDIC premiums are not payed by taxpayers Tax payers are legally required to pay taxes in USD. I'm not actually sure if the IRS technically accepts cash but if so it would be extremely rare. Meaning all tax payers have a bank account and ultimately foot the bill even though it is technically funneled through the banks' books first.

"Footing the bill by having a bank account" is one of those very-hard-to-picture-or-feel things in days when most bank accounts are "free" and these banks have so many lines of business. E.g. am I paying for FRBs bailout by increased loan application fees if I buy a house or car or such? That's what I'd imagine, or maybe it's just that maybe otherwise savings accounts would pay a bit more interest or something?

Re: Bank Failures Visualized

#293

Post by Ilverin »

sam_goody wrote: post #214

And now that the fed said they will only "fully" back depositors in large banks that go under, there will be even more consolidation, so the next crash can consist of just one huge circle that acted gregariously and irresponsibly before its collapse, but no one could do anything because of its size. What makes this even worse, is that Yellen would have lost nothing had she said they would back every bank and not just…

The large banks are more heavily regulated. Trump raised the limit at which a bank is called large from 50bil to 250bil. The small banks value their freedom from regulation more than they would value full FDIC coverage. The fed would love to make that trade:more regulation of small banks in exchange for full FDIC coverage for small banks.

Canada is dominated by five enormous banks, they are closely regulated, and Canada has had a better experience than USA with both fewer bank failures and higher real interest rates paid to customers.

Re: Bank Failures Visualized

#294

Post by majormajor »

I've seen a bit of discussion about concerns around office property mortgage and such (e.g. JP Morgan wanting to be insulated about losses on outstanding loans) for FRB which seem concerning as a post-Covid systemic risk.

I wonder if the consumer deposit side, though, has a lot to do with an unanticipated risk of the particular business model SVB and FRB were using: higher-income people. Sounds great - less risk of defaulting on loans - but then you are highly-concentrated in larger deposits for a smaller total population (larger meaning less insured, so easier to spook; smaller population means the panic doesn't have to spread as far)... so it works well for decades and is seen as something to aspire to... until it suddenly doesn't.

Re: Bank Failures Visualized

#295

Post by abeppu »

reylas wrote: post #281
abeppu wrote: post #275

Mike Bostock knows far more about data visualization than I do so I assume there are good reasons for choosing this presentation. But it strikes me as hard to think about, so I must ask: when is stacked+packed circles a good choice? The drawbacks to me seem to be: - At any given point on the x-axis, the associated height of the pile is partly taken up by circles but is partly space lost to circle packing. This propor…

The way I understand the graph is that is not the "number" of circles, but the area (money) that they consume. So those three bank failures are taking up the same space as all those other failures from 2008. It is the total volume of money involved vs the count. The height of both stacks show just how much damage three did vs all the others in the left hand stack.

Yeah I get the count vs area distinction, but I think the point would have been more cleanly communicated with e.g. a stacked barchart with failures by quarter. With circles, the filled area over any span of the x-axis is not solely due to failures which happened during the corresponding time period. So the area above a short span in early 2010 includes area contributed by WaMu, which happened in Sept 2008.

Re: Bank Failures Visualized

#296

Post by RC_ITR »

yieldcrv wrote: post #176
RC_ITR wrote: post #170

Earlier quoted context omitted.

What does that have to do with decentralized consensus? You know, the core differentiating feature of cryptocurrency.

it doesn’t and that wasn't the premise of why we can acknowledge that using that payment network saved everyone time in the clawbacks, despite the shaken confidence that the exact same event caused into that payment network the main distinction involved here is that not knowing who to subpeona for records slows down everything, whereas with the blockchains used most of the participants consolidate funds into KYC’d ex…

Wait, we recovered almost all of Madoff's money too?

Traditional finance has plenty of clawback mechanisms.

You're completely straw-manning a world in which traditional finance isn't also mostly done on KYC'ed exchanges.

Re: Bank Failures Visualized

#297

Post by RoddaWallPro »

themagician wrote: post #10
thehumanmeat wrote: post #2

That needs to go back to the 80s to capture the SnL crisis. It dwarfs 08 in bank failures. It better indicates the conglomeration of the many banks into the few we have today.

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…

Fool me... you can't get fooled again.

George W gaffes have become so hilarious to me, now that they're 15+ years in the past. I laughed out loud reading this one.

Re: Bank Failures Visualized

#298

Post by themagician »

usefulcat wrote: post #266
themagician wrote: post #173

Earlier quoted context omitted.

I want something GOOD like FTX running on Quickbooks. That's what people need to aspire to these days. That's why I like Wells Fargo. Create fake accounts… so absurdly brilliant. JP Morgan might be the biggest, but I just don't have faith in them like I do Wells and Citibank or even HSBC. Some lame overly complex scheme isn't want I want. I want a decimal in the wrong place that everyone just ignores despite nothing…

> FTX running on Quickbooks Quickbooks? I thought they were using post-it notes. Maybe I underestimated them..

Post-It note was for the login.

Username: accounting@ftx.com

Password: hunter2

Re: Bank Failures Visualized

#299

Post by themagician »

johnvanommen wrote: post #142
bboygravity wrote: post #42

Earlier quoted context omitted.

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 was a hedge fund manager / college professor from Irvine CA who figured out Madoff's scam in the 90s, and nobody paid attention to him whatsoever.

I never liked Madoff. Not inventive. Never found him aspirational. He also stole from seniors which I'm not a fan of. He deserved his fate.

Re: Bank Failures Visualized

#300

Post by theironhammer »

Ilverin wrote: post #293
sam_goody wrote: post #214

And now that the fed said they will only "fully" back depositors in large banks that go under, there will be even more consolidation, so the next crash can consist of just one huge circle that acted gregariously and irresponsibly before its collapse, but no one could do anything because of its size. What makes this even worse, is that Yellen would have lost nothing had she said they would back every bank and not just…

The large banks are more heavily regulated. Trump raised the limit at which a bank is called large from 50bil to 250bil. The small banks value their freedom from regulation more than they would value full FDIC coverage. The fed would love to make that trade:more regulation of small banks in exchange for full FDIC coverage for small banks. Canada is dominated by five enormous banks, they are closely regulated, and Can…

Sure the Canadian banks are more stable but they are EXTREMELY conservative when it comes to lending out money. That's why the USA has a robust venture capital milieu while Canada does not.

In fact a Canadian bank would rather loan money to an American business to buy out a Canadian business than to lend the same Canadian business to expand.

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