INFLATION

Discussion in 'West Mall' started by Chop, Nov 30, 2021.

  1. mchammer

    mchammer 10,000+ Posts

  2. ViperHorn

    ViperHorn 10,000+ Posts

    Sacks' first tweet has merit as far as it goes. Having a Board of Directors full of politicians instead of people who had a history of working in banking and finance for a living and a State Banking Regulator who unexplainably was AWOL are the issues.

    His second tweet is laughable. SVB's banking customers are getting a bailout funded by the US Government (who, we have to remind people at times) is a drain on the economic health of the country.
     
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  3. Monahorns

    Monahorns 5,000+ Posts

    It is a bail out of rich depositors/investors who didn't pay attention to FDIC coverage limits. They chose foolishly to put way more money in one place than is insured, and now working class people are going to pay for rich peoples' foolish in the form of more price inflation. Whatever way you want to look at it, the rich are stealing from the working class. The working class are now justified in taking forceable action to protect their own property.
     
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  4. Monahorns

    Monahorns 5,000+ Posts

  5. Chop

    Chop 10,000+ Posts

    Perhaps a better way of handling depositor bailouts is to raise the legal $250,000 limit to $500,000 (or even more), then draw a line in the sand. Beyond that, no more. No bailouts of depositors above the federally insured amount.
     
  6. ViperHorn

    ViperHorn 10,000+ Posts

    Good idea Chop, but the line in the sand has gone from $50,000 to $100,000 to $250,000 now to non-existent. After SVB there might be a footnote amount, but Uncle Joe and Company have effectively done away with the FDIC and limits on "insured" bank accounts (but they will keep the FDIC open to keep from having to eliminate government jobs).
     
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  7. Monahorns

    Monahorns 5,000+ Posts

    If the limit has already gone up multiple times the jig is up. It will be raised further when it becomes politically expedient.
     
  8. Monahorns

    Monahorns 5,000+ Posts

     
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  9. Horn2RunAgain

    Horn2RunAgain 2,500+ Posts

    My $2 wager is on deflation. Already told my wife we're holding off on her new car, new carpet and hardwoods, kitchen redo until summer 2024. Credit crunch in place, glut of materials in the next 12 months.
     
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  10. Chop

    Chop 10,000+ Posts

    Could be...?

    I'd be watching inventories to check up on your projected glut of materials.
     
  11. Horn2RunAgain

    Horn2RunAgain 2,500+ Posts

    No doubt. But when credit is hard to find, bargains can be had because of overages in inventories. It'll happen. Cash is king, always has been. Good buying opportunities ahead
     
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  12. Chop

    Chop 10,000+ Posts

  13. Chop

    Chop 10,000+ Posts

    "Who exactly is making money off your expensive food?"

    Cargill: In fiscal year 2022, its revenue reached a record $165 billion. A record $6.68 billion of that was profit, double what its profits were in 2020. Its shareholders received $1.21 billion of those profits in dividends — yet another record.

    Tyson: more than doubled its profits between the first quarter of 2021 and the first quarter of 2022.

    General Mills: profits were up 97 percent

    Conagra: 22 percent profit increase in its last quarterly earnings report.

    Walmart: has seen its profits grow for the past several years, with a 7 percent jump between 2020 and 2021

    The Mars family: Between 2020 and 2021, they added $21 billion to their fortunes.


    Inflation is the best thing that ever happened to food companies
     
  14. Chop

    Chop 10,000+ Posts

    Last edited: Mar 17, 2023
  15. Horn6721

    Horn6721 10,000+ Posts

    Yes profits are increasing at both food companies and oil companies.
    But are the net profit margins increasing?
     
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  16. Chop

    Chop 10,000+ Posts

  17. Chop

    Chop 10,000+ Posts

    Argentina's President (presiding over 100% inflation):

    Alberto Fernandez -- a left-wing Peronista (a quasi-Socialist type)

    His "accomplishments"

    - doubled compensation for employees dismissed without just cause for 6 months
    - tax hikes on foreign currency purchases
    - tax hikes on ag exports
    - wealth tax hike
    - tax hikes on car sales
    - freeze on utlity rates
    - bonuses for retirees
    - bonuses for Universal Allocation per Child beneficiaries
    - food cards (food stamps) to 2 million more people

    Oh yeah, and Inflation rising to 100%

    [​IMG]

    Alberto Fernández - Wikipedia.
     
  18. Chop

    Chop 10,000+ Posts

    The usual script in world history is:

    A dictator comes after a guy like this who brought the country hyper-inflation.
     
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  19. Chop

    Chop 10,000+ Posts

  20. Chop

    Chop 10,000+ Posts

    So, to prevent further devaluing of the Treasury Bonds on banks' balance sheets, and further bank failures, the FED must stop raising rates.

    I guess we'll be seeing inflation around for quite some time...
     
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  21. Chop

    Chop 10,000+ Posts

  22. Chop

    Chop 10,000+ Posts

  23. Chop

    Chop 10,000+ Posts

    https://www.washingtonpost.com/business/2023/03/19/inflation-interest-rates-bonds-svb/

    "In recent years, banks — newly flush with extra deposits from pandemic-era savings and stimulus — bulked up on bonds and other fixed-rate investments like mortgage-backed securities. At SVB, fixed-rate securities made up nearly 60 percent of the bank’s assets at the end of 2022."

    "But as the Fed raised interest rates, those bonds became less valuable.SVB’s $91 billion portfolio of long-term securities was worth just $76 billion at the end of 2022. That $15 billion gap was far wider than the $1 billion shortfall the company reported a year earlier."



    Sounds like a poor investment strategy by the bank. Some investments do well; other investments do poorly. So who should bear the cost of their investing mistakes?
     
  24. Chop

    Chop 10,000+ Posts

    Bank Holiday(s)?

    [​IMG]
     
  25. Horn2RunAgain

    Horn2RunAgain 2,500+ Posts

    Increases over the pandemic year of 2020? Misleading
     
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  26. Horn6721

    Horn6721 10,000+ Posts

    I'd like to see how the profits compare to other non food companies
    and especially how as a % they compare
     
  27. Monahorns

    Monahorns 5,000+ Posts

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  28. Chop

    Chop 10,000+ Posts

    Talking heads mostly say the Fed will pause for a while and not hike rates.
     
  29. nashhorn

    nashhorn 5,000+ Posts

    Ha, the bank needs interest rates to stop rising and there’s speculation it will. The national debt needs rates to stop rising and who gives a rats a**.
     
  30. Chop

    Chop 10,000+ Posts

    Inflation could be here to stay.

    Next up—public indoctrination (Cough, I mean education…) campaigns to convince the masses that moderate inflation is actually a good thing; and arguments can be made that it is…

    I think Journey expressed the reality of inflation best: “ some will win, some will lose, some were born to sing the blues. Oh the movie never ends, it goes on and on and on and on…”.

    :trophy:
     
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