It was announced earlier this week that public workers represented by the National Union of Public Workers (NUPW), Barbados Worker’s Union (BWU), Barbados Secondary Teacher’s Union (BSTU) and the Congress of Trade Unions and Staff Associations of Barbados (CTUSAB) finalized five months of wage negotiations. The deal reached as reported is 3% increase for the next two years and a lump sum payment of $1,500.00 in the first year. There was also agreement to some non financial terms.
Since the announcement social and traditional media and other voices have been strident in condemning the paltry sums employees at the low end of the scale will be receiving. The blogmaster will always be sympathetic to the plight of workers, however, in this case the question must be asked – was processed followed by the unions involved before agreement with government was finalized?
As far as the blogmaster is aware actors sitting at the negotiating table with government had to take direction from the respective membership bodies before agreeing to close negotiations. The blogmaster would be interested to know if the traditional process of negotiating the wage increase was followed.
The concern of the blogmaster is that the economy of Barbados continues to struggle post Covid 19 as it was pre Covid. We should not mistake increase economic activity back to post Covid level as reflecting a buoyant economy. The same individuals voicing disappointment at the wage settlement are also concerned about the size of government’s domestic and foreign debt. We do not need reminding many Barbadians had to suffer a severe financial hit as a result of this government’s initiative to restructure debt in 2018. The objective was to create wiggle room/fiscal space for government. The blogmaster would be disappointed if all parties concerned allow the country to erode gains made since 2018 notwithstanding the hit from the pandemic.
Prime Minister Mia Mottley is slated to present the ‘budget’ next week and to be expected the political operatives are on the job. The draft estimates currently being debated point to a significant deficit the government will have to fund in the 2023/2024 year. The deficit will have to be closed by more borrowing, reducing public sector cost, increasing fees to Barbadians or all the above. Those arguing for higher wage settlement should remind Barbadians there is a money pot. It is ironic to listen to the Democratic Labour Party (DLP) spokespersons referring to the fact State Owned Entities (SOEs) will have to be rationalized, a process started when the DLP last held government. Every year since the blog started to cover these matters there is the feeling of déjà vu that overwhelms.
The reality is that the Barbados economy in the last four years has not transform to be able to generate new revenue option for government. A significant amount of every dollar earned still has to be allocated to service debt. The pandemic eroded significant gains made it must be reminded. The government needs to communicate effectively with the citizens it serves to help with understanding the perilous state of the economy. Like some observers the blogmaster will follow the debate to understand what novel approaches the government intends to roll out. Hopefully there will be relief to the state of déjà vu that continues to permeate the blogmaster’s headspace.
Our economy will continue to be bad until we stop taxing inputs and raw materials directly used by our manufacturing sectors in the production of their products.
Taxes should only be applied to finished products at the import, distribution or consumer level.
For Example:
If I buy/import a bag of flour to make bread at home, I should pay tax on it. However, if I owned a bakery and was using that same bag of flour to make bread for sale, that same bag of flour should be tax free to me with the government collecting taxes from the finished bread sale onward.
Like it or not, one of the main drivers determining inflation rate rise is rise in government worker pay.
Hence, government can never give more than a 3% wage increase as long as they are they remain the employer of the largest number of workers in the country otherwise inflation runs the risk of outpacing GDP growth.
What needs to me questioned is the alleged inclusion of a 10% raise in allowances as reported to by Caswell on Brasstacks. Allowances do not need raising.
@ CA
The problem is more fundamental than that.
It is that our albino-centric government thinks that money will solve all problems.
They therefore seek to tax every shiite to the max, eventually killing the goose that lays the golden eggs.
When they collect all these taxes, they then dish out the revenue to their family, friends and cuntsultants – rather than supporting the PRODUCTIVE sectors of society (the Geese) on a merit basis.
@ David
Why can’t you agree that what is missing is TOP LEVEL LEADERSHIP that seeks to bring sensible change to the status quo?
OBVIOUSLY an ‘across the board’ increase is counter productive at this time.
Making the rich even richer and the poor even relatively poorer helps no one.
Even a simple policy that seeks to narrow the gap in the increases given (as has happened before) would be better.
For example, 15% at the bottom ranging down to 3% at the top would be more equitable, and would actually cost less. But of course the ministers and other senior people may see it differently (albino-centric f$%^#s’) …lol
@Bush Tea
What is ALSO missing is strident civic engagement. It is how a breathing democracy is supposed to function.
@Bush Tea
What do you expect from a socialist democracy.
Government taxpayer funded free handouts are far easier to campaign on than policy and tax changes that enable and encourage people to produce and earn for themselves instead of depending on government charity.
Unfortunately, they don’t realise they can have their cake and eat it too if they ensured all producers of physical products got everything duty/tax free and ONLY taxed sales.
Show me the household budget that could be sustainable by borrowing, year after year, in order to make up the shortfall of spending over income. What would you call someone who lived like that? How long would that be sustainable?
When will government’s spending ability outperform its borrowing capability and what is the plan when that happens?
We should be living in fear.
@FearPlay
The practice by governments in these times is to roll over debt. The plan is never to repay principal and interest.
The practice by governments in these times is to roll over debt. The plan is never to repay principal and interest.
~~~~~~~~~~~~~~~~~
Correct!
..so as FearPlay suggest WISELY, “we should be living in fear”….
Except of course, we are so brassy that ‘we fear not because we know not’….
Called ‘blissful ignorance’, it represents the calm before the storm… or the music by the band on the deck of the Titanic – before the cold waters take over….
There’re growing concerns amongst observers that with the failure of SVB, contagion similar to Lehman Brothers circa 2008, maybe in the offing.
No doubt engendered by the reckless policy of the FED to deflate the American economy by moving short term interests rates north of 5 percent after many seasons of free money to the big banks.
This economic tactic was always misguided for 75 percent of inflation is generally located on the supply side. Meaning driven by businesses by increases in the costs of their goods and services to consumers.
Demand push inflation could be around 25 percent.
Contagion and bank-runs in the USA will have implications for countries who like to believe that USD denominated treasuries still represent a safe sheller. Even as the yield on treasuries move in lock step with interest rates.
However, these potential increased yields may hide the increasing possibility that holders of paper in foreign reserves are facing more and more risks of massive declines in the value of the American dollar viz a viz other currencies. Some observers estimate as much as a 50 percent correction in the USD, the stock markets.
What are the local brain trust thinking? Could any of these narratives make sense in such circumstances of free fall? Will there every be a point in time when proactive measures are possible?
Within the geopolitical, only yesterday Iran and Saudi Arabia buried animus, brokered by China. And given the correlation of forces, the distribution of fossil fuel resources etc, it’s past time when insularity and outdated wanderings are set aside.
Why do we need to increase taxation every time we need more money? The answer is simple our collection systems are inefficient Fullstop !
Let me make it simple by using this example . You have a 20 gallon bucket that has holes in it so 20 gallons of water can no longer fill it. As the holes get bigger rather then closing them, you buy a bigger hose hence putting water into the bucket in larger amounts. As the holes get bigger again from not addressing the problem, you then decide the answer is to now put 2 hoses in the old tail rotten bucket.
We are expensive because we are inefficient and rather than address these issues ALL governments for the last 20 years have just thrown more money at the problem as a solution. I mean wunna want a better example than when we forgave $500 million in Vat taxes cause we couldn’t get it collect??
We is nuff nuff talk but dat is all!!
@John A
Isn’t this why BRA was introduced, to efficiently collect taxes?
Sunak, the Hindú Indian boy who is trespasing on the British prime ministership is making disparaging remarks about slavery, Afrikans, peoples of colour.
Slavery of some modern formation in relationship to the aasylum seekers coming ashore there. Not in the good vessel ‘Jesus’ but in dinggies as hostages of those who trade in flesh. As a result of his country’s wars on Lybia, Iraq, Irán, Syria, Afganistán in the immediate past.
These are economic refugees as a result of the destruction of their economies by White people and their agents. Sunak being one.
A clueless boy who must yet learn that his Conservative members are most likely to presume that they should be still ruling Indian, than for an Indian to be ruling them.
For these things there is absolutely no “confusion”. What is highly confused is the expectation that a post slavery society, with colonial mentalities rite large, and in the absence of radical transformation, while seeking closeness to the West, could deliver anything other than “confused”.
For us everything is connected to everything else. Creativity requires making those critical links. Anything else is an invitation to the mundane🤣🤣🤣😇😇
“Creativity requires making those critical links.”
They will now learn how very crucial and important creativity is to everything.
Waru
It saddens that the tectonic plates are shifting under our very feet and trite remains the order of the day in places one would presume would most benefit. But no!
We are to be forever confused by consumption. There was a time when a disese was called consumption. Consumption by Twitter. Consumption by trivia. Consumption by a never ended paper chase of nothingness. Consumption of the same mindless economic equation which transports us to a merry-go-round without the production of a single answer. We simply rinse and repeat.
It’s painful.
Everybody we know who got money or resources are running for the hills. But there seems to be some expectation that the future can be bent by pretended a known and dying world is all there will be, should be.
We talked earlier about the Iran-Ssudi rapproachment. Leaving Iran aside, the stealth by the Saudis in thread a delicate diplomatic needle as economic alliances shift, while avoiding a palace coup, but acting to materially reallign oil resources from the USD hegemon to BRICS and SCO, while operating as a captive in the hands of a might nation is remarkable.Never liked MBS much, neither did Modi, but when one sees such a reallignment of forces it’s a wondrous thing.
We ignore this at our peril!
@ David
It was the BRA that could not collect the $500M remember. LOL
@John A
It is very frustrating why a segment of the taxpayer base has to always suffer from government’s failure to collect taxes.
BRA had no choice but to write it off because the VAX collection system has a fundamental flaw with the tardy disbursements of VAT refunds creating cash flow issues for businesses which would have certainly embarassed BRA after they lose the case when it eventually got to court.
Few businesses are truly entitled to refunds after the VAT paid against collected is netted off so BRA should ONLY be collecting net VAT with periodic auditing to address accounting errors and fraud.
Source: Nation
Source: Nation
“But there seems to be some expectation that the future can be bent by pretended a known and dying world is all there will be, should be.”
Still waiting for miracles while pretending their hearts out.
…in the meantime am sure the slick talking liars are writing a new script for them to swallow hook line and sinker…..but, there is a shift. Just heard a recording putting the deceivers on blast and on notice….their days are clearly numbered.
I also noticed the global shift, worth watching closely..
Pacha..it’s coming down, just saw a clip where the CDC director is telling what looks like a congressional ..saw Margo Greene asking questions….hearing how the covid virus came about and who is responsible..
They better start making wills…especially those who love to jump on bandwagons and bully pulputs..to exploit, terrorize oppress and kill their own people..
.
…cahn wait for the show to begin….nuh amount of legislation to muzzle anyone gine work this time around…they made their burning beds…now lay in it MFs..
Gotta stock up on popcorn and other niceties…..just imagine dem did it to demselves ..cahn blame a fella..lol
What is that bullshiiite about fiscal constitutions, such can only be skimmed? Where do these people keep coming from with their useless degrees, false ‘respectability’ and nuff rasssoul which equals to picking peas out of shiiite? What has to happen for even the liberal free marketeers to known, at the basis level, that markets are/were never free, never fair?
William..i dont know what to tell them anymore.
No one should be confused..
And
Everyone should know only too well how THEY got here….so that question has become obsolete…right along with…”it does happen everywhere.”
Am just happy not to be there with them..nowhere in that orbit…..lots to be thankful for….
Kiki…this is where a book of fictional characters will come in years down the road..
But for others it’s way too LATE to tell them…be very careful what you COVET……YOU KNEW it was NEVER yours in the first place….but greed and ignorance, the historical idiocy of never doing due diligence, and tried to swallow an elephant….choking, choking, choking..
…legislate away, it will make absolutely no difference.
@ WURA
I think the most dangerous signs are those who are now promoting censorship and subtle attempts to curb the freedom of expression.
On the other side of the coin, we have been discussing doing similar in Barbados for many years. Oh to be followers.
https://jamaica-gleaner.com/article/news/20230310/jamaica-customs-equip-officers-body-cameras
Low yield treasuries in it’s protfolio vs the aggressive increasing interest rates, over the last year, by the FED was one of the major causal factors in SVBs collapse.
The other obviously, was again low yield mortgage backed securities, a throw back from 2008.
Of course, the executives since January have been taking turns dumping stock as if such a thing could be hidden.
And while it appears likely that contagion will be contained for now, it’s farcical why local socalled experts and political elites, like Mottley, continue to sit on their hands hoping to be lucky or that some White knight, or knighthood, will ride to the rescue when it has been clear that the socalled experts, near and far, have no answers to the systemic collapse now virtually unescapable. If not this time, maybe next!
We’ll have a better understanding once the FED chairman, or the the large banks to which he is or a captive of, will be allowed to double down on increasing interest rates, aimed at improverish the masses more, presumeably to control inflation or will the banksters again demand that the free money regime of recent decades be reinstituted.
The boys are meeting all this weekend. Yellen too! We’ll have an indication by tomorrow about the extent to which chairman Powell will listen to the banksters or his titular political máster Biden as an election year beckons.
Which ever way this goes Mottley should admit that she is feckless and is in no position to take any proactive measures to deal with a looming economic catastrophe clearly forseeable by all except beggars and borrowers and socalled non debt funding.
Thomas Sankara Quotes
It took the madmen of yesterday for us to be able to act with extreme clarity today. …
You cannot carry out fundamental change without a certain amount of madness. …
I can hear the roar of women’s silence. …
The French revolution taught us the rights of man.
When the power of love overcomes the love of power the world will know peace.
Jimi Hendrix
[Verse 1]
“There must be some kind of way out of here”
Said the joker to the thief
“There’s too much confusion
I can’t get no relief
Businessmen they drink my wine
Plowmen dig my earth
None will level on the line
Nobody offered his word”
Hey!
[Verse 2]
“No reason to get excited”
The thief, he kindly spoke
“There are many here among us
Who feel that life is but a joke
But, uh, but you and I, we’ve been through that
And this is not our fate
So let us stop talkin’ falsely now
The hour’s getting late
Hey!
[Guitar Solo]
Hey!
[Verse 3]
All along the watchtower
Princes kept the view
While all the women came and went
Barefoot servants too
Well, uh, outside in the cold distance
A wildcat did growl
Two riders were approaching
And the wind began to howl
Hey!
[Outro]
All along the watchtower
All along the watchtower
“@ WURA
I think the most dangerous signs are those who are now promoting censorship and subtle attempts to curb the freedom of expression.”
They know what they are trying to hide but shit outta luck…tick tock.
Day runs the 24hr cycle but night ALWAYS catches up.
Pacha…all we can say is what a tsngled web they weaved from 2018, and ya done know already what happens to deceivers..
“What is that bullshiiite about fiscal constitutions, such can only be skimmed? Where do these people keep coming from with their useless degrees, false ‘respectability’ and nuff rasssoul which equals to picking peas out of shiiite?”
I believe that Shakespeare could not have put it better.
Wonder how many times a structurally flawed system like financial capitalism must fail before the brigade of adherents in Barbados come to see that they are assholes.
Our people in both Washington and New York are having deep fears about what will happen when the Asians markets open tonight, our time. And more importantly, when the European and American capital markets open on Monday, tomorrow. The Asians markets will be an early indicator.
They fear runs on the banks. All banks. They seem not as confident as this writer was about the absence of contagion effects over the SVB failure.
No major bank anywhere has ever had enough cash on hand to return such a level of withdrawals. Even of such withdrawals, in the case of the USA, are beyond the 250K per account as insured by the the government.
This writer wished words could be found to explain the magnitude of the perilous state this economic system finds itself in, at a deeply structural level. For example, in a worst case scenario one may go to an ATM and refused cash. No food in the stores etc.
Indeed, it represents political malpractice by a Mia Amor Mottley and this regime to have located the future of the country on the good graces on such a highly unstable system without another national option under the rubric of it being the best set of organizing principles. When the reverse has long been true.
That that reliance is almost entirely based on the IMF, the WB and a new fangled Ponzi scheme called non debt funding is recklessly bewildering in the extreme. “Watch muh”
When the shiiite hits the fan we will expect the puerile responses of her “children” here.
Someone whatsapped me this the other day. Is this “misinformation”?
Here are some of the new laws coming under the new computer misuse bill that will be going to parliament next month.
(1). A person who use a cellphone, or, an electronic device to record a fight of any kind is guilty of an offense, and, is liable on summary conviction to $5000 or 5 years in prison or both.
(2). A person who use a cellphone, or, any electronic device to record a police officer in the execution of their duties, is guilty of an offense, and is liable on summary conviction to $10,000 or, 5 years in prison or both.
(3). A person who wants to use a cellphone, or, any electronic device to carry out recordings of themselves, that might contain misinformation, to present that information to the public must first seek permission of the Government Information Service (GIS).
(4). A person who uses a cellphone, or, any electronic device without the permission of the Government Information Service (GIS) to make any recordings of themselves that might carry misinformation is guilty of an offense, and is liable on summary conviction to a fine of $ 10,000 or 5 years in prison or both.
(5). A person who records another person without their permission is guilty of an offense and is liable on summary conviction to $ 10,000 or 5 years in prison or both.
(6). A person who stores videos of any kind on a cellphone or any electronic device for the purpose of recirculation at a later date without the permission of the parties involved is guilty of an offense and is liable on summary conviction to a fine of $ 10,000 or 5 years in prison or both.
(7). A person who has a need to use a computer or a cellphone or any electronic device to post videos of themselves that contains any information on the Government of Barbados, must first secure permission from the Government Information Service (GIS).
(8). A person who has not sought and received permission from the Government Information Service (GIS) before recording and posting information that can be cited as misinformation, is guilty of an offense and is liable on summary conviction to a fine of $10,000 or 5 years in prison or both.
(9). A person who uses the platforms of social media of any kind to send or share misinformation false, or misleading information is guilty of an offense and is liable on summary conviction to a fine of $10,000 or both.
(10). A person who uses a cellphone or any electronic device to make recordings of any activities, such as projects or any business, being undertaken for which a minister is assigned, without the permission of the minister, is guilty of an offense and is liable on summary conviction to a fine of $10,000 or 5 years in prison or both.
Oprah Winfrey is said to have lost 590MM in SVB.
Maybe the herd shall be running to all banks tomorrow, maybe?
And the prophet Jimi said..
And so castles made of sand
Fall in the sea
Eventually
Am hearing some real descriptive words like “flock of idiots” lol.
People are dying with laughter.
“Oprah Winfrey is said to have lost 590MM in SVB.
Maybe the herd shall be running to all banks tomorrow, maybe?”
Serious business regulators stepped in.
When Government’s bail out banks..
it’s the people that have to pay..
(Interest rates have just gone up again as banks have cleared their debts from 2008 bailouts)
“…Those who led us to indebtedness gambled as if in a casino. As long as they had gains, there was no debate. But now that they suffer losses, they demand repayment. And we talk about crisis. No, Mister President, they played, they lost, that’s the rule of the game, and life goes on.
We cannot repay because we don’t have any means to do so.
We cannot pay because we are not responsible for this debt.”
― Thomas Sankara
How serious can regulators be when the system itself is fraught
Waru?
Good question. I kept completely out of that system at a certain level, worked in it for a few years doing contract work within my field of expertise but never reached those heights of decision making in that sphere, did not know any of those folks at the tippy top, never heard of them, …ya only saw signatures up to directors and one or two senior Vice presidents ..any higher is obviously a whole other dimension and must be studied for better understanding.
I did notice the cycles, ebbs and flows and the effect on the work force, did conclude that it was not the perfect setup..but much better than anything found in this or many other regions, right up until everything went to hell.
Source: Nation
Pacha…based on information released from certain boards apparently in the last hours regarding SVB, i would have been hopelessly lost and was right to stay out of any such debates…re Federal Reserve, IMF and World Bank..
Naturally, based on other branches of the US government like IRS administration, my mind always associated fed regulators as being another administrative branch of the federal government…it never once occured to me there was a private interest component.
Regulators are paid for by the Industry the regulate
Industry Regulator means any statutory or non-statutory body with responsibility for regulating (or promoting self regulation) of the provision on the type of services being provided by the Supplier.
Regulatory capture is an economic theory that says regulatory agencies may come to be dominated by the industries or interests they are charged with regulating. The result is that an agency, charged with acting in the public interest, instead acts in ways that benefit incumbent firms in the industry it is supposed to be regulating.
Key Takeaways
Regulatory capture is an economic theory that regulatory agencies may come to be dominated by the interests they regulate and not by the public interest.
The result is that the agency instead acts in ways that benefit the interests it is supposed to be regulating.
Industries devote large budgets to influencing regulators, while individual citizens spend only limited resources to advocate for their own rights.
“Cash”
Here we go around again Curve of life spiraling
Everything we’ve ever known As the seed of life gets blown
And the miracle of time When will that time just end
Remember, you decide Take that vow
Grab that ring It’s not a whim
Not a whim When you be cashing in
Try to turn your life around And all the things you do resound
And then you can’t loose control Say your time has come and then
Hard to pinpoint find the seam Where that one time ends
Where that time begins Remember, you decide
Take that vow Take a stand
Grab that ring It’s not a whim
It’s not a whim It’s only time
That you’re cashing in
In the white noise of desire We can’t hear a single thing
Floating round the fragile bough Afflictions of the human soul
Its beauty immaterial
You decide Stand along
The fallen ones Take revenge
Defeated sons Rend that coat
From seam to seam It’s only time
It’s only time That you spend
You spend It’s only time
You spend Its only time
You spend It’s only life
That you’re cashing in
Btw…with all that’s happening and NO CONSTITUTION……an ILLEGITIMATE government….YOU ARE FINALLY FREE…
I said a year or two ago that Black people tend to never kñow when they are free…and seem to crave a perpetual slavehood…..ya can go TRAP yaselves again under corrupt, criminal governments, as the mentally ENSLAVED …that will be on you. Your current and future generations should judge you VERY HARSHLY..
Pacha…just noticed another bank collapse…New York based Signature bank.
Wonder if that is it or there more to come.
https://youtu.be/_bUcyfvysWo
Mottley,
The ship is sinking!!!!!
Waru
Ok, yes!!
These days are funny nights.
Pachamama is single-handedly punishing them for their crimes against our Ancestors.🥶🥶🥶🤢
It was once said here that Pacha could only tear down, we’ll yes, for now.😜
The FED is promising limitless cash to any bank to protect depositors.
Plus the anticipated 50 basic points interest rate increase this month seems shelved.
These two factoids will no doubt make inflation worse. Indeed, the medicine is worse than the perceived cure.
These people are clueless! Mia Mottley too. As she can only hope for the best. What leaderlessness!
The bottom line is that these people are feckless.
By the time the BRICS meet in September and locate the big deckie of an international reserve currency in their pokerts expect to see USDs in the street with no one interested in picking them up.
Waru
This writer is trying to grapple. What is certain is that nobody in Barbados is seriously clued in. Maybe they feel that begging and borrowing is the best strategy.
“Maybe they feel that begging and borrowing is the best strategy.”
That is all they know…there is not, nor has there ever been a proactive, intelligent braincell shared between any of the groups squatting in the parliament for the last 100 years, or they wont still be puppets and minions within well controlled cyclical orbits of limitations..
Pacha…no bailouts.
Wuh dese here gine do when the begging and borrowing is one day STOPPED TOO…..bet ya not one of those clowns thought that far ahead…especially when there will be no billions in reparations to tief…outside of what the universities will be supplied with for educational purposes only.
“No Silicon Valley Bank Bailout — US Treasury Secretary
Janet Yellen ruled out a bailout for collapsed Silicon Valley Bank on Sunday, although the government would assist regulators in protecting depositors.
“During the financial crisis, there were investors and owners of large systemic banks that were bailed out,” Yellen CBS News’ Face the Nation. “The reforms that have been put in place means that we’re not going to do that again.”
Yellen admitted concerns at the likely problems depositors would face being paid back in full, given that about 85% of them were not insured, but insisted the American banking system is “really safe and resilient.”
WW&C
They bailed out the Depositors vs bailing out the bank itself. Similar shit.
@Northern, why do you consider it “Similar shit”!
This debate of bail-outs gets too esoteric and like all aspects of life has become too polarizing and divisive.
How do Republicans (conservatives) look at the intervention by govt regulators to return depositors money (even over the FDIC $250K standard) as ‘capital welfare’! I don’t get that narrative.
Obviously govts CANNOT backstop investment risk taking and therefore no monies should be returned to venture capitalists, bond holders etc nor of course should the management executives (like the SVB CEO who cashed in billions in stock just a few weeks back) get any of the backstopping funds.
But why on earth should a mom or pop or retiree or business owner who deposits their life-savings or operating business income to a bank for simple safe-keeping (at paltry interest gains) and standard business efficiency have to suffer when a bank’s management make absurdly, incompetent (negligent even) operational decisions!!!
I get it that it’s difficult to set one standard and then apparently modify that standard on the fly but social operations must be examined (and effectedd) in practical terms and not this type of esoteric, impractical prattle we see on the political landscape!
Should we not use banks then or should we not doubly expect regulators to CLEAN UP their SH** when THEY allow it to hit the fan.
Lata.
Dpd
There are no mom and pops here.
This is not about MrX or MsY who have lost their life savings.
This is a financial institution which deals with VCs and other businesses. Mostly in tech.
The line is, because some bankers didn’t balance their exposures, we’ll protect you, even though SVB has the highest percentage of uninsured monies in the USA.
So instead of bailing out SVB, they make the banks customers whole. And leave SVB itself to crash.
@Northern, I may have been a bit loose with the ‘mom and pop’ reference but as I understand from the reporting there were some relatively small start-up tech companies in addition to the big VC players…. so in bland business speak. yep there were maybe many ‘Mr and Ms Tech Savvy Daughter and Son’ operations there if not ‘Moms and Pops’!
I would agree as well that some of the players “didn’t balance their exposures” but in the main this bank had well over 100 billion in deposits made up of “basic” business: a good % in hard product/software tech and some in crypto currencies (which some like JP Morgan Chase CEO Dimon has called ‘pet rocks’) .
So as noted none of the VCs or others who were ‘investing players’ should be reimbursed but if you deposited money at SVB regardless of how big you were it’s difficult to not get your full deposit insured — principally to contain a massive fissure in the overall society … and yes the bank itself must crash and be rebuilt (as best as possible)!
The other debate of banking entrepreneurs being reckless with risks if a govt WILL guarantee ALL bank deposits (moral hazard) is moot IMHO. Regulators are SUPPOSED to oversee and manage the process to ensure this does not happen; if they don’t then what should we expect.
These are troubling situations with much to unpack.
Anyhow I dun wid that. Peace.
Northern…noticed 85% of depositors are uninsured…whereas banks are always ensured to the hilt.
Am still working through unfamiliar territory.
Waru
The opposite of a bail-out is a bail-in . That is what we may see. A bail-in is when depositors funds are used to wind down a bank.
However, Biden, Yellen et al seem to be saying neither will happen.
They appear to be saying that even depositors with over the insured amount of 250K will get their funds back. Not sure. But we seem to get that impression.
This is what sentiment can do. For at least SVB was not very less viable as banks go than others.
But once a stampede starts people loose all reason. Animal instincts take over. Especially when you can quickly withdraw online.
This is a scenario in which the banks, regardless of how well they maybe performing, can win.
“They appear to be saying that even depositors with over the insured amount of 250K will get their funds back. Not sure. But we seem to get that impression.”
Yes, am familiar with the ceiling on insurable deposits, so that is very plausible, giving the highend investors involved…seems like a guarantee..
Is NOT a scenario ,,,,,,,,,,
Seems like nothing is 100% sure and we are in for the long haul.
“The Arctic region holds an estimated quarter of the globe’s oil and natural gas resources, while its sea routes could shave days, if not weeks, off traditional commercial shipping passages.”
This should be required listening. From a former marine to Mia Washington Consensus Mottley and a feckless population blindly so following.
How true. Every country which is a vassal of American empire, like Georgia and Barbados, is being set up to be fucccked.
https://youtu.be/S3ykiZcnJ5I
Waru
What we’re saying is that in the case of SVB it’s socialism for the rich customers as it was a special bank with a customer base of venture ‘capitalists’ mainly. In all other cases depositors with over 250k loose their shirt.
We do not hear the capitalists on this contradiction.
@ Pacha
Did the CEO of SVB nor cause the crash by publicly announcing that there was a problem, but that
‘all would be well as long as depositors did not withdraw their funds’..? lol!
What a JA!!
Are you seeing how easy it would be for ONE donkey to wreck the whole global money illusion?
Almost as dumb as the local FSC and Central Bank making a big PUBLIC fuss because a large credit union’s report was late…
Luckily for us, local brass bowls would only have reacted if they saw the local abinos taking out their money FIRST – and that demographic don’t deal with credit unions – too transparent!! – so we got away with that folly…
Saw people lining up outside a republic bank in California that took a recwnt beating, a wealthy neighbourhood, those whose deposits are not covered for more than 250K.
Something is definitely going on.
@Waru,
Pachamama and yourself may be interested in this story. The statement could have come from the mouth of Quaker John.
https://www.dailymail.co.uk/news/article-11859879/WSJ-columnist-labeled-branded-racist-suggesting-SVB-distracted-diversity-demands.html
TLSN…just another dumb racist seeking attention and he got it. Let them roast him until he is well done , so well deserving…lol
The social space is jampacked with such clowns. Social media put them on blast and they run into their toxic holes to lick their wounds. Never to be heard of or from again.
Yes Pacha…something is definitely off this year…but doan cry for this guy, unless he loses another 10 billion, he is still on top..
“Charles Schwab lost $3 billion due to banking crisis
“Billionaire Charles Schwab’s wealth plunged nearly $3 billion after shares of his brokerage Charles Schwab Corp plummeted amid the US banking crisis, causing its market value to drop nearly 38% so far this year.
As founder Schwab has much of his fortune tied to a 6% stake in the company, the billionaire has seen $2.9 billion wiped off from his fortune since March 8.”
New buzzword…..”moral hazard”
“Capitalism — Ken Griffin
The US government’s intervention in the unfolding banking crisis has been slammed by Citadel hedge fund founder Ken Griffin, who told the Financial Times the situation should have been a good lesson for investors.
According to the report on Monday, Griffin said the strength of the US economy meant the authorities did not have to take such forceful action. “It would have been a great lesson in moral hazard,” he was quoted as saying by the FT. “Losses to depositors would have been immaterial, and it would have driven home the point that risk management is essential.”
Pacha…Ha Ha’s post office banking…and newly created banking pods, along with vans, will be the in-thing for face to face banking now that branches are shutting down.
” MoneySavingExpert.com homepage
Chair, Martin Lewis · Editor, Marcus Herbert
MoneySavingExpert.com News 2023 March
MSE News
Barclays to shut 14 more branches in yet another round of closures – here’s the full list, plus alternatives
Petar Lekarski | Senior News Reporter
13 March 2023
Barclays has announced a fresh round of bank branch closures, with 14 more locations set to shut in the summer – in addition to the 41 it had already announced would close this year. The latest closures now mean Barclays will close at least 55 branches by the end of 2023. Below we list the branches disappearing and what the alternatives are if you still want face-to-face banking.
Seven other high street banks are also closing branches this year; read more on the closures at Halifax, HSBC, Lloyds, Nationwide, NatWest, Santander and TSB.