This reminds me of one of my favorite books from the past couple years, A Libertarian Walks Into a Bear. It’s a fascinating deep dive into an attempt to create a sort of libertarian utopia in a small town called Grafton, New Hampshire. The speed at which they arrive at “we need government services” after they eviscerate government services is… unsurprising. 10/10 I highly recommend it for anyone that’s interested in…
A more recent example is the water crisis taking place in Cochise county. https://grist.org/regulation/arizona-groundwater-cochise-cou...
SVB shows that there are few libertarians in a financial foxhole
431–440 of 493 posts
Re: SVB shows that there are few libertarians in a financial foxhole
#432Earlier quoted context omitted.
A more recent example is the water crisis taking place in Cochise county. https://grist.org/regulation/arizona-groundwater-cochise-cou...
> Kingman, where a Saudi-backed company grows alfalfa for export back to the Middle East
Re: SVB shows that there are few libertarians in a financial foxhole
#433Earlier quoted context omitted.
>Cool, now do socialism. I didn’t “do” libertarianism? I recommended a book that I found interesting that’s related to the topic of the article that this discussion thread is in response to. Socialism has been brought up a couple times in response to my book recommendation and I’m a little confused by that. Is the assumption that the reporter that spent years meticulously researching, interviewing, and documenting th…
There is an increasing tendency to interpret these things in false dichotomies, I've found. If you criticise libertarians you must be a socialist and vice versa. I had a similarly frustrating encounter the other day, where my critique of the interaction between capitalism and democracy in the US was constantly construed as some sort of glorification of socialism, even when I never mentioned it. My patience for this t…
Does it? Isn't Earth's political system libertarian? The emerging conflict/cooperation between nation states is a market phenomenon. The UN is akin to a chamber of commerce.
Democracy has, at most, continental reach (EU).
Re: SVB shows that there are few libertarians in a financial foxhole
#434This reminds me of one of my favorite books from the past couple years, A Libertarian Walks Into a Bear. It’s a fascinating deep dive into an attempt to create a sort of libertarian utopia in a small town called Grafton, New Hampshire. The speed at which they arrive at “we need government services” after they eviscerate government services is… unsurprising. 10/10 I highly recommend it for anyone that’s interested in…
This is the same reason communism doesn't work. "Oh the people will control everything!" Except humans always give someone power... and that power will want more power if you allow it, until you end up in a terrible spot. The trick is to not let any one big group have too much power. It is not possible to create a society without groups taking charge and without those groups vying for power. One thing Libertarians ha…
How many of those services were purposely broken by libertarians, so that they could be targeted for privatization? I've worked in government, and have yet to see a service run more efficiently or cheaper after it's been privatized. The quality of the service is almost universally worse.
When something is privatized, it's usually given a monopoly via bid. Now you just have a different set of people, with less experience, running the same service, with a percentage of the cost of running the service being siphoned off. There's also an incentive to provide less of the service, or run the service at a worse quality to maximize profit. The government has the option of running the service at a loss, but a private entity does not, further reducing the service quality level, often at the times you need it the most.
When I worked in government, we had a software platform that was privatized. Every few years the contract to run the platform was put up for bid. To improve the likelihood of winning the bid, the vendor made the code purposely incomprehensible, wrote the minimum amount of documentation required, and kept most of the system maintenance manual. They most likely had in-house automation for most of the manual tasks, but that wasn't included with the contract. This also kept the bid price extremely high. When the contracts did switch hands, you'd end up with major operations issues after switchover, and numerous downtime events (this also made it harder for them to win the bid next time). Eventually it was considerably more expensive to contract out, but nothing is ever brought back from privatization.
Re: SVB shows that there are few libertarians in a financial foxhole
#435The author ignores that behind the downfall of SVB was a climate of excess liquidity on the markets, a bonanza created by the authorities that made SVB see itself with a glut of funds. Now, SVB, loaded with money, could have tried loaning it like crazy, but instead, decided to go the conservative way and buy bonds. Someone could argue that they could have foreseen that this abundance of liquidity in the markets, alon…
> But in the end, even if we could argue that SVB should have been more prescient, it is clear that the root cause of the problems is the actions of the government and the FED. No. SVB hid market to market losses by saying "these securities are held to maturity so I don't have to realize losses". THAT is the source of the problem. Not all banks did this. Sure excess liquidity was necessary for this behavior to be pos…
> It’s true that investors had been aware at the latest since its 10-Q filing on Nov. 7 that it had sustained unrealized losses among its held-to-maturity (HTM) portfolio large enough to wipe out its entire $15.8 billion in shareholder equity. While this would theoretically render it insolvent were they to materialize in full, SVB Financial was dismissive of the risks.
"SVB collapse highlights $620 billion hole lurking in banks’ balance sheets" -https://archive.is/qnwYh
Also short sellers worked it out a while back too
"A Silicon Valley Bank short seller explains how he knew the bank was in trouble months ago" - https://archive.is/XaKkt
Re: SVB shows that there are few libertarians in a financial foxhole
#436Earlier quoted context omitted.
Why didn't the fed decide that course of action in this case? Seems the difference is small. Shareholders still lost everything, depositors lost nothing instead of 10% but that's a minor difference. Guess one difference is how long it'll take before depositors can access their money. Now they'll get it immediately. If they were waiting for liquidation of the banks assets, that would probably take longer.
The difference is that the thought of losing 10% is enough to make everyone else consider withdrawing the money they have with their banks. And that initiates a bank run that would spill over all the banking sector. The bailout is not to protect SVB; that's already gone. Fed is now trying to avoid having people stress testing other banks, because they probably won't handle it.
Re: SVB shows that there are few libertarians in a financial foxhole
#437Earlier quoted context omitted.
It nearly killed billions of dollars in real value and required untold thousands of taxpayer-funded employees working through the weekend to unfuck the situation. If I drive recklessly, I am still guilty of reckless driving even though I didn't hit anyone or anything.
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Re: SVB shows that there are few libertarians in a financial foxhole
#438Earlier quoted context omitted.
> Anyone working in risk management will tell you SVB’s risk team and executive team should be in jail. Jail seems extreme for an error in judgement that neither killed nor maimed anyone.
that might (or might not) be arguable from a moral viewpoint, but it definitely isn’t arguable from the actual statistics. about half of the US state prison population is there for non-violent crimes. https://en.wikipedia.org/wiki/Incarceration_in_the_United_St...
Re: SVB shows that there are few libertarians in a financial foxhole
#439Earlier quoted context omitted.
Didn’t they announce HSBC is buying SVB. And they specifically said that no tax payer funds would be used here. The only loses here are for the shareholders of SVB. Did the gov broker the deal, sure, but it sounds like most of that brokering happened on the other side of the ocean. Basically it sounds like exactly the sort of thing a libertarian would support.
An actual libertarian I would point out that HSBC is only buying the UK branch of SV Bank and the line about no taxpayer funds is evasive language and a borderline lie. No tax revenue is being used to bail out the depositors, but every American with a bank account is paying for it. They're just applying a new fee to every Bank in the country to cover the losses It is still socialized losses.
Re: the fee, where do you see that?
Re: SVB shows that there are few libertarians in a financial foxhole
#440Earlier quoted context omitted.
Or you could just explain that fair and beautiful refer to the content of their character and swarthy is a synonym for smarmy, or evil and has nothing to do with skin color at all.
But that's not what he meant and we both know it.