1ClassyLady 67F
3348 posts
3/19/2023 2:31 am
Bank crisis, not again


You probably heard the recent "bank failure" from news. It took me for a while to figure out those banks problems. My bank CEO/Chairman passed away in January 2022 (a year ago), so I can't ask him the reasons for those banks failed.

Those banks included SVB (Silicon Valley Bank in Silicon Valley, Calif), Signature Bank, FRC (First Republic Bank in San Francisco) and CS (Credit Swisse a global investment bank in Switzerland).

We all knew that there were many banks bankrupted due to sub-prime loans in 2008 when I was in China for 8 days/6 nights, my banker friend emailed me from the USA said the banks were not leading loans. We witnessed the Lehman Brothers collapsed, Indymac Bank bankrupted on July 11, 2008, and many banks had to be bought by big banks. such as JP Morgan (JPM) bought Washington Mutual, Bank of America (BAC) bought Merrill Lynch, Wells Fargo (WFC) bought Wachovia, Fannie Mac (FNM) & Freddie Mac (FRE) – de-listed on 6/17/2010, ..... In 2008, people couldn't pay monthly mortgage payments on time, so they dumped houses to the lender banks. The banks wanted the borrowers to pay payments but not to foreclose their houses. My banker friend told me to buy houses in cash. Lucky me that someone in Taiwan wanted to buy my mom's house in Taiwan. Because my mom was weak to walk (in wheelchair) due to arthritis. I got the "Power of Attorney" to represent her and went back to Taiwan to sell our family house in Taiwan. I wired back the sold proceeds to the USA in my mom account in 2011. I asked my banker friend how to invest. He said buy rental properties in Las Vegas, so I bought 5 properties with my mom sold proceeds in 2011. My mom passed in Sept 2013. I inherited her properties.

I am a pharmacist, don't know much about "Finance" but I remember my banker friend's advice. I have NEVER invested in Bond market, but I invest in stocks.

From recent news, I learned Silicon Valley Bank failed within 48 hours. I read the news said banks use the depositors money to invest. SVB bought lots of Bonds when the interest rate was very low. Recently SVB sold its stock and Bonds and lost of billions of money. Higher inflation often results in higher interest rates. Persistently elevated inflation altered the landscape for bond investors. If interest rates move higher, stock investors become more reluctant to bid up stock prices because the value of future earnings looks less. so, SVB had "double whammy"雙重災難;禍不單行;



Honesty is the best policy.


1ClassyLady 67F
3218 posts
5/15/2023 1:30 pm

Mr. Paul Tudor Jones says on May 15, 2023 on CNBC that the Fed is done raising rates, stocks to finish the year higher from here.

I concurred his opinion.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
5/3/2023 8:59 pm

The U.S. Federal Reserve, FOMC (Federal Open Market Committee) has many interest rate hikes in order to fight the "Inflation" in spite of many banks have failed recently, such as Silicon Valley Bank, Signature Bank, First Republic Bank (FRC) bought by JPM on Sunday 4/30/2023.

On 3/17/2022, FOMC interest rate hike 0.25% (25 base point)
On 5/5/2022, FOMC interest rate hike 0.50% (50 base point)
On 6/16/2022, FOMC interest rate hike 0.75% (75 base point)
On 7/27/2022, FOMC interest rate hike 0.75% (75 base point)
On 9/21/2022, FOMC interest rate hike 0.75% (75 base point)
On 11/2/2022, FOMC interest rate hike 0.75% (75 base point)
On 12/14/2022, FOMC interest rate hike 0.5% (50 base point)
On 2/1/2023, FOMC interest rate hike 0.25% (25 base point)
On 3/22/2023 FOMC interest rate hike 0.25% (25 base point)
On 5/3/2023 FOMC interest rate hike 0.25% (25 base point) - new range of interest rate in between 5% to 5.25%. FOMC has increased 5% interest rates in total.

I think a method to take of advantage of high interest rates by putting my money into CD (Certificate of Deposit) for short term 6 months. I compared different banks offer and chose the highest CD rate. (I chose Citi Bank because it offered best rate and also because Citi Bank is an international bank, not a regional bank).

In today's press conference, Fed Chair, Powell reiterated "strongly committed 承擔義務" to bring Inflation to the target of 2%. However, after market closed today another bad news broadcasted on CNBC that PacWest Bank (symbol PACW) sharply plummeted 50%. Bank sector also dropped on this news. Especially regional banks. I only have JPM in bank sector.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/29/2023 11:27 am

In 2008 banking crisis, FDIC increased insured amount from $100K per person, per account to $250K. Now, 2023 Silicon Valley Bank and Signature Bank customers (depositors) have problems to withdraw their money that over $250K to get that exceed FDIC insured amount of $250K.

Wall Street is discussing "should FDIC increase insured amount even higher?" on CNBC channel.
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Federal Reserve FOMC increased interest rate 0.25% higher on 3/22/2023 and mentioned that FOMC might increase another 0.25% again in the future depends on CPI and PPI that give FOMC inications that inflation has been tamed or not.

CPI is Consumer Price Index
PPI is Producer Price Index



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/25/2023 2:14 pm

A German multinational investment bank, "Deutsche Bank" shares slid on 3/24/2023 while the cost of insuring against its default spiked, as the German lender was engulfed by market panic about the stability of the European banking sector.
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My bank sector stock is JPM has different trouble ties with the late Jeffery Epstein (he suicide in the jail). JPM Chase Bank lawsuit its ex-executive employee, Jes Staley over alleged ties to Jeffrey Epstein.

Bank sector now is under favored in stock market.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/22/2023 1:30 pm

The U.S. Federal Reserve, FOMC (Federal Open Market Committee) has many interest rate hikes in order to fight the "Inflation".

On 3/17/2022, FOMC interest rate hike 0.25% (25 base point)
On 5/5/2022, FOMC interest rate hike 0.50% (50 base point)
On 6/16/2022, FOMC interest rate hike 0.75% (75 base point)
On 7/27/2022, FOMC interest rate hike 0.75% (75 base point)
On 9/21/2022, FOMC interest rate hike 0.75% (75 base point)
On 11/2/2022, FOMC interest rate hike 0.75% (75 base point)
On 12/14/2022, FOMC interest rate hike 0.5% (50 base point)
On 2/1/2023, FOMC interest rate hike 0.25% (25 base point)
On 3/22/2023 FOMC interest rate hike 0.25% (25 base point) - new range of 4.75% - 5%. Year-end funds rate project 5.125%.

In the press conference, Fed Chair, Powell said "strongly committed 承擔義務" to bring Inflation to the target of 2%.

Stock market first reaction was jump up (especially Nasdaq), I sold some shares of NVDA, AVGO, and META for profits. Then after press conference the market indexes sharply go down to the closing bell. My best performance and favorite sector is "semiconductor" sector.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/19/2023 5:35 am

Investment sources are Real Estate, Stock market, Bond, Gold, Annuity, bank accounts, .... etc.

I have bank checking, savings accounts to pay bills, eating, traveling, ... I have accounts in 4 different banks. Why? Because the FDIC only insured up to $250K (1/4 million) per person in a bank, In case of one bank failed, I still have 3 other banks. I set-up "Living Trust" and "Will" for my two children when I died one day. I put my Savings account in "Living Trust" name, so I can have 3 persons protection from FDIC insured $250K x 3 = $3/4 million per bank. My banker friend told me to get LLC (Limited Liability Company), but I don't want to pay tax to IRS $800 extra for LLC. However, LLC can protect your business failed, the attorney can't sue your residence (home) property.

I have Real Estate properties, of course. Buy low, sell high. I pay Management Company to take care my tenants and to avoid tenants to bother me. Those properties I own all changed to "Living Trust" title. No one can get those properties except my two children. Nobody even I married him, or he kill me, he still can't get my properties because "Living Trust" title. Scammers can't get either. My "Living Trust" for my daughter and my son only. Someone posted blog here said scammers bothered him. I can't be scammed, even I married him. He only can get my income during the marriage period.

I have stock account, of course. My stock account is the biggest amount in all my banking accounts or properties. I use "Living Trust" for my stock account. I have been told $250K x 3 persons = $750K (3/4 million). But stock account has 2 million. I have to think some other investment.

I used to have Gold coin, but sold all the gold many years ago. No interest earned for Gold. Need to keep in bank safe deposit box. No, no more gold.

I have "Annuity", it based on S&P 500 index up or down. Again, my Annuity account use "Living Trust".

No, no Bond, no Cryptocurrency. I don't believe in Bond or Cryptocurrency.

I am not brag my wealth, but you need to know "Investment". I learned from my bank CEO/Chairman friend who I miss him dearly. He set-up LLC, Inc., Living Trust for his two biological daughters and one adopted daughter long time ago, longer than I met him in June 2006.
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I have read an attorney's online dating profile that said "most of my money is on real estate". That's mean he has Living Trust on his properties and even you marry him, you still can't get his real estate properties. He will ask you to sign prenup before the wedding. Rich people know how to protect their money. It's called "Once bitten twice shy". My banker friend said "Divorced person got scared to marry again". However, he gave me free advice, he said "God helps those help themselves".

Be smart, be vigilant, you won't be scammed.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/19/2023 3:46 am

In my previous blog, I had recommendations to buy Taiwanese-American CEO's Semiconductor stocks at low price such as AMD, and NVDA. I even posted these two companies CEO photos. Yes, I put my money where my mouth is. I bought AMD, NVDA and TSM. I don't care about Chinese stock, or IPO stocks, or Bitcoin/ cryptocurrencies, or Airline company stocks. I am a swing trader. I bought a little by a little until the price stop plummet. My average prices of NVDA is more than $100 per share than current price . I sold few shares of NVDA lately, but still own NVDA and AMD. Because China Xi saber-ratting 武力恫嚇 Taiwan daily, so TSM stock not very strong. I also have AVGO and ASML (Dutch semiconductor equipment company). No, I don't own any Chinese stock that even not on my watch list.

I like high-tech market cap Trillion companies in Nasdaq and own AMZN, GOOGL, SHOP (Canadian AMZN), MSFT, ADBE, .... Unfortunately, AMZN, SHOP, GOOGL are side-way slowly. I am holding them. No, I don't have AAPL. My MSFT has profits, I sold only a few shares just in case of FOMC meeting on 3/22/2023 keeps interest rate hike and stock market will plummet. For bank sector, I only have JPM. In Finance sector, I have PYPL (a loser stock), and MA (Mastercard) a winner.

I have some Bio-tech stocks, just get even, not win or lose. I have TSLA but not win or lose. I have had DIS (Disneyland) sold 50% for profits already, a winner.

I have loser stocks such as ZM, PYPL, KMI, SHOP, ... I am doing fine in Cloud software and Applied software sectors.



Honesty is the best policy.


1ClassyLady 67F
3218 posts
3/19/2023 2:55 am

Due to "Inflation", Federal Reserve (FOMC, Federal Open Market Committee) had to raised the interest rates.

On 3/17/2022 FOMC interest rate hike 0.25% (25 base point)
On 5/5/2022 FOMC interest rate hike 0.50% (50 base point)
On 6/16/2022 FOMC interest rate hike 0.75% (75 base point)
On 7/27/2022 FOMC interest rate hike 0.75% (75 base point)
On 9/21/2022 FOMC interest rate hike 0.75% (75 base point)
On 11/2/2022 FOMC interest rate hike 0.75% (75 base point)
On 12/14/2022 FOMC interest rate hike 0.50% (50 base point)
On Feb 1, 2023 FOMC interest rate hike 0.25% (25 base point)

Next FOMC meeting will be March 22, 2023. Will FOMC keep interest rate hike that will cause more bank failed? Will FOMC stop interest rate hike that will cause "Inflation" not tamed 馴服? What do you think FOMC will do on March 22, 2023?

We shall see.....



Honesty is the best policy.