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Morning all, crikey I leave the manor for getaway and it all goes to 541t lol
Relying on a scatty wifi signal was not reassuring either.
Anyhow it would have been nice if the US authorities / regulators had paid more attention to the fact they were humping up the rate and common sense tells us all "Ying always has a Yang" lol
Not sure about how a few others on here feel, though I would rather have seen Barclays take on SVB and counter offer HSBC's £1 with a £1.01 rather than take the gamble on the KMC in our current climate (It will take at least the next 5 yrs for green shoots to appear on that purchase) where SVP will generate HSBC a lot of $'s in a shorter time frame.
After a stiff coffee to clear off some jet lag Ive just doubled up on Fridays touch @ 150 on the nose, really chuffed still and looking forward to the incoming yield bounce.
Was hoping to see a few more bulldozers start pushing this morning, though it seems trying to balance out atm.
Not a way to trade if you are pessimistic, like some. Though I always do my risk / reward b4 any trade (plus the fact I'm still fortunate enough to have a healthy profit amongst all this chaos) Ive sat on Barcs more times than my tail and confident this aint going south over this recent obstruction.
Few of us took advantage back last October when a few pessimists worried it was going lower than 130.
Mrs Wolf loves preaching in my ear over dinner "Shouder, couder, wouder" lol
FTSE is even testing the 200 ma atm
Scalpers paradise !
GLA
Well I never took the short at 190, but it turns out my fears about the bonds etc were correct. I’m not sure how deep it runs from here but I’m pretty confident most banks will be effected to some extent.
For as valid as the fears around the banking sector are, I think the share price trajectory is more a return from the mid-range no man's land we've been in for several months to well established support levels.
Barc should fall to close to 130p.
This is a game of patience now.
Don't get caught.
I was going to buy if it hit 150 but the way it's going I'm now thinking 140.
I am certainly not brave enough to buy until the US opens, even if 145p were to hit. Not saying it will, just my POV.
If the dominoes come out stateside this afternoon, there is no telling where the bottom is for Barclays. Hope no-one followed those who were suggesting a re-entry point was in the low £1.60's.
I was expecting a (dead cat) bounce this morning. Perhaps waiting to see how the US fares when their markets open? Any technical traders here? 145p looks like some degree of support to my unskilled eye, but I would welcome the opinions of anyone who actually knows chart stuff properly.
@Warsaw I think its a good buy for HSBC. As you say a loan book for 5.5bn, rates going to continue to rise and most of these loans get re-financed. We need good CPI numbers tomorrow from the US and some calm. Markets don't go up in a straight line but boy they do fall in a straight line lol. I'm debating with myself on another Barc buy if we get some stability, could be another swing trade on offer.
Have a good Monday all. My little one was watching US market review over breakfast haha.
Well I wonder if we will see a bit of a bounce here in the coming days? Ok we've got the budget hanging over our heads but so long as we don't have a Truss moment then I think it could be on the cards.
SVB UK was ringfenced from the US operations and was profitable - making £88m in the last year. They have a lot of money on deposit (£6.7bn) and a lot of money out on loan (£5.5bn). However having the same name as their US entity means they get tarred with the same brush.
But I dare say many people were shifting their money out last week and you can expect a bit of panic.
In time this could be shrewd move by HSBC, they've bought a loan book worth £5.5bn for £1, but presumably have inherited a bit of debt to go with it.
Yeah, not sure I would be too happy if I was a HSBC holder. Reminds me of those government approved/driven takeovers that happened last time. Maybe it will be different this time of course. So, the only losers are the SVB shareholders I assume?
Glad we did not take up this brilliant offer...:-)
RNS says bought for £1
According to the BBC
https://www.bbc.co.uk/news/business-64937251
Definitely behind the sofa ,chitty chitty bang bang all over again hair would have turned white if I had some not even 7 am yet
"Lovely jubbly"
Did anyone really believe the "World is nigh?" lol, considering the true blame lay on the shoulders of the US regulators for not doing their job !
The W' clan have ventured away from the den recently and on Saturday I went to a cash machine, no cash, then another and again, no cash.
So I stood scratching my head, then it dawned on me, the local community had panicked about their savings and had obviously hammered the cash points.
Crazy, absolute crazy as they must have thought it was another Northern Rock scenario lol.
Bit of balancing about to kick in this week (Might even be today in fact) 2 yr Bond and a yield bounce, should reflect good on the big banks.
The Feds really need to plough on with the hikes, they know it and most of us know it, though now they will need to keep a close eye on the potential impact on smaller banks, each time they raise rates.
US tech sector is going to get a rough ride the next 6 months now, though nothing new there as the liquid funds were drying up anyway.
Now with SVB it appears they (tech) have had the KY and margarine confiscated taken away.
Which leaves me with the same opinion I had on Friday post US open "Nothing to see here, move on"
Will admit as I would be fibbing through my incisor's if I hadn't questioned myself for adding some @ 155.52 / naked with no S, too long in the game to be concerned, so those self doubts lasted brief seconds.
Interesting day / week ahead, though all those cowering under the table, can come out now.
Good luck to all on the open, lets hope some common sense digs in way of support.
Regards W'
In a statement, the Fed said it would make additional funding available to eligible depository institutions to “help assure banks have the ability to meet the needs of all their depositors”.
It added that it is “prepared to address any liquidity pressures that may arise”.
The new facility, the Bank Term Funding Program (BTFP), will offer loans of up to one year to lenders who pledge as collateral US Treasuries, agency debt, mortgage-backed securities and other “qualifying assets”.
https://www.ft.com/content/8e0be2f4-0b41-4768-b586-49180980ba90
SVB depositors will get all their money (feat. SBNY shutdown)
https://www.ft.com/content/72c25414-aabe-432a-a785-a8b2bd6887f9
The latest update from City AM. The sentence that pricked up my ears was: “Most analysts expect that sell-off to continue this week.”
Regards MrA
https://www.cityam.com/silicon-valley-bank-uk-what-we-know-and-what-we-dont-on-sunday-evening/
Typically with Mergers and Takeovers, the stock price of the Aggressor normally goes down with the price of the takeover target going up. I appreciate that the takeover target here is ‘dead in the water’, so the markets will decide whether the ‘emergency takeover price’ paid by Barclays, if it indeed buys Silicon Valley Bank, is a bargain price or not… and reflect it in Barclays share price within minutes of any Purchase announcement made. But as we have seen the markets remain anything but “normal” at the moment.
Regards MrA
No idea how true this is but on the BBC news Barclays are said to be considering buying the bank.
£85k wrong !
Ns&i = £1m
Chris Whalen and Peter Schiff also offer some interesting (and differing) opinions on this topic. Advice: Do not listen to the latter if you are of a nervous disposition or close to your bedtime :) Yes, he is the ultimate perma bear, but I also enjoy hearing his take on financial stuff. Good to read as widely as possible, to avoid falling into an echo chamber IMO. Anyway, it will not take long to see if this gets contained effectively or otherwise. IMO, it might take a few days to see the direction of travel here, so not going to read too much into Monday market action, here or across the pond.
They cant just dump 200bn of mbs and bonds overnight as that could tank the market and cause waves. Thats predominantly why the us federal government stepped in; for an orderly wind down of these assets as to not cause any reverberations as SVB could no longer contain the runaway bank run and panic.
But on the macro scale, thats as far as this will go. Theres simply no way mainstream banks will face this problem. Banks that are classified crucial for a functioning society are under such tight restrictions that barring a mass panic of epic proportions, they simply can't run out of cash and be forced to firesell underperformimg assets. If (very very very very unlikely) a bank such as JPMorgan or hsbc reported this issue....it would be 2008 on steroids and we wouldnt be talking here, we would be desperatlely pulling deposits from every account we own. Fortunately, the US govt will fence in SVB, or at the very least stop the travel upwards. But with many fintech banks and small startups in the financial sector, who knows how many of these could have similar issues where they have blown all deposits on low yielding assets, with no new inflows to diversify and increase PF yield. When you deposit money with these companies, unless they are backed by FSCS you put your money in the hands of the CEO and their competence. But this will certainly bring in new levels of scrutiny for this sector, despite govt lobbying for red tape to be cut to bring in innovation to this sector. But this incident once again highlights the massive risks involved if you let your guard down.
There will be repercussions for companies/individuals who have huge sums tied up here however...and we will find out how deep of a hole SVB put themselves in. I expect many will be forced to take a haircut, perhaps even a buzz cut.
A lesson out of all of this. Dont put all your eggs in one basket. Those fortunate enough to have over £85k in cash deposits....diversify. This way, your deposits are backed by government and no matter what happens...you get your cash back.
As for companies who had millions tied up in this bank who say they can't make payroll....they should find a new CFO. Unacceptable risk to not diversify deposits and have contingency accounts for such an event.
Interestingly, soon as I read the title of this thread, I was going to link that post but seems like that’s the one you linked. Great explanation that.