Black Monday

[Aaron]

Kiwi Bonds I would call super safe, but probably the half million cap would be to low for some.
I was thinking there should be a way whereby one could park money at a bank or similar, just to be held but not lent out, for a fee of course. But other than by holding actual cash would it be possible?

The $500k cap is not a problem for me. But if it was super safe why wouldn't you stay in Kiwibonds (currently 4.25%). I would guess if financial markets seize up then there would not be much of a secondary market to sell your bonds to make cash available, but if everything was turning to custard interest rates would be dropping and your kiwibond would become more valuable. Adrian can always print more money to roll them over when they mature. I will have to stop now as I do not really know what I am talking about.

Regarding me and gold, it is just a faith based speculation, central banks hold it and treat it as currency (that is why it is exempt from GST). It is the only currency that didn't double in quantity (for this reason, in theory it should become more valuable when compared with other currencies) over the pandemic panic. I am pumping it as I am speculating on gold producers and currently have some losses which might not be so bad after today. If Powell drops interest rates tomorrow I might even be in the green.

If I was really worried perhaps I should take my own advice. Whether 12months 2yrs or 4yrs it is all 4.25%. The next step I guess is to find out when the next lot goes out and if there is a secondary market for them.

[mike2020]

I thought we were assuming there is no longer anything stable and we are back to loo paper is the new gold. It seems to be the mood. Whenever I see talk of putting gold in your backyard I get this Mad Max image in my mind.

[BlackPeter]

...

Also, what good is actual gold? If things are entirely pear shaped what use it is? I can see the logic if it is an investment thing but it is entirely worthless like bitcoin. Go any buy some pumpkins or kumera at least you know for sure they will be worth more in a few weeks or months if you store them right.

Better living

Probably not the right thread to discuss the rational behind humans fascination of gold. Fact is however that it was considered valuable in any human civilization (and it kept or increased its value in any crisis) - over the last thousands of years. Apply this test to cryptocurrency - LOL.

Humans do plenty of stupid things, and though I don't know whether their attraction to gold is one of them, it would be still more stupid to ignore this human trait in a time of crisis.

From a practical perspective: Gold is rare and people can't make more of it (securing its value), it is durable and not dependent on any working infrastructure, it does not take a lot of space and it is easy to transport (test your pumpkin or kumara against these criteria) - attractive for people who need to break up their tents and move and still want to take their wealth with them.

[percy]

New York
CNN
—
Silicon Valley Bank’s collapse last week sent tingles of panic down investors’ spines as it highlighted a larger problem across the banking sector: The widening gap between the value large lenders place on the bonds they hold and what they’re actually worth on the market.

SVB’s downfall was tied, in part, to the plunge in the value of bonds it acquired during boom times, when it had a lot of customer deposits coming in and needed somewhere to park the cash.

But SVB isn’t the only institution with that issue. US banks were sitting on $620 billion in unrealized losses (assets that have decreased in price but haven’t been sold yet) at the end of 2022, according to the FDIC.

What’s happening: Back when interest rates were near zero, US banks scooped up lots of Treasuries and bonds. Now, as the Federal Reserve hikes rates to fight inflation, those bonds have declined in value.

When interest rates rise, newly issued bonds start paying higher rates to investors, which makes the older bonds with lower rates less attractive and less valuable.

The result is that most banks have some amount of unrealized losses on their books.

[bull....]

US treasury secretary rules out federal bailout for collapsed Silicon Valley Bank

https://www.stuff.co.nz/business/wor...on-valley-bank

so have to hope someone buy's it
also watch for the risk of contagion this week if nothing happen's to solve SVB might get big run's on other institution's
2008 again ?

[ynot]

US treasury secretary rules out federal bailout for collapsed Silicon Valley Bank

https://www.stuff.co.nz/business/wor...on-valley-bank

so have to hope someone buy's it
also watch for the risk of contagion this week if nothing happen's to solve SVB might get big run's on other institution's
2008 again ?

Definitely a possibility. SVB's situation is not unique.
If customers lined up tomorrow at any other major US bank looking to withdraw the same scenario would apply.

[winner69]

Definitely a possibility. SVB's situation is not unique.
If customers lined up tomorrow at any other major US bank looking to withdraw the same scenario would apply.

Queue of 4 at Westpac ATM Cuba St just now ….hmmm

[ynot]

Queue of 4 at Westpac ATM Cuba St just now ….hmmm

Metservice have live weather cams. Investors need live bank ATM cams.

[percy]

Why Silicon Valley Bank Died (UPDATED)...

https://livewiremarketsptyltd.cmail2...d-ydtteyktj-j/

[mike2020]

Metservice have live weather cams. Investors need live bank ATM cams.

I thought there were a few Russians providing the service?