After a busy week I'm looking back on the whole credit suisse debacle and shaking my head in a combination of laughter and disbelief.
Smaller regional banks that have not been in business over a century dropping the ball and faulting is one thing.
Credit Suisse was a 167 year operation that basically just got euthanized by the UBS bailot.
One Hundred and Sixty Seven Years!!!
Seriously, what kind of greed and laziness does it take to mess up such an institution?
Clearly they were doing something right, most likely for the first couple decades atleast, then I'm sure the greed seeped in.
It's U.S. Bankings Fault...
This is essentially what Credit Suisse said. The Silicon Valley Bank collapse impacted them and then they "discovered material weakness in their financial reporting procedurs."
LMAO, more like the chickens finally came home to roost.
I mean, it's not that freaking hard. How about not leveraging to the tills to squeeze every fraction of a penny out of every dollar. Then, when the slightest thing goes wrong you won't blow up.
Comical.
Bitcoin for the win!
Posted Using LeoFinance Beta
Years of mismanagement and a lot of shady business !!
I called the Credit Suisse insolvency back in October of last year on my Substack in an article I wrote following the Swiss National Bank begging the Fed for $6B to bail them out. I knew then that CS was destined to implode, took several months tho!
Thesis intact!
Posted Using LeoFinance Beta
LOL
I agree.
Banks are one of the greatest businesses in the world.
All the rules are known, all the risk is in your favor, and the biggest banks, like the richest people, traditionally take the least amount of risk possible, and still win... but then greed and avarice set in and everything changed.
People who would never write a bad loan, wrote them by the thousands, then they bundled them up in the ten thousands and sold them in packages, over and over to squeeze as you said every dime of profit and then some.
This greed gravy chain seemed like it would last forever, but they never do, and all bills come due.
I feel a smidge sorry for the American Banks who got caught in this record rate hike action by the Fed, but only a smidge because these people think about banking 24 hours a day, it's their only job, and they didn't decide to hedge their downside?
Regardless of whether the Fed performed record rate hikes or not, these people get paid to think about what happens to their investments in different environments, and this is an environment that a Wharton School of Business graduate should have anticipated...
The clearly forseeable risk of high interest rates as the logical risk to hedge against during a low interest rate environment, could only missed by people blinded by greed.
It's not an complex algorhythmic calculation to anticipate the effects of higher interest rates when your in a low interest rate envirnment.
Some might say it's the only risk the banks had, and they simply ignored it.
An app metaphor might be, that on a sunny day, the only thing which could ruin your picnic would be rain. It seems that they should have anticipated the need for an umbrella...just in case.
Posted Using LeoFinance Beta