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The influence of Fed rate hikes "is going to hit...That is how it is designed." As of December officials expected the policy rate would rise to around 5.1% by year's end. The experience of 1970s-era central bankers informed not only the extent of the rate increases, with the policy rate rising 4.5 percentage points from near zero as of last March. None of those reforms prevented SVB from funneling its rapidly growing deposits into long-term government bonds that lost value as the Fed raised rates. The Fed has announced a review of its supervision at SVB to see if warning signs were missed.

☆ Global banking crisis: One big problem down. Too many others left to go
▼ + stars: | 2023-03-20 | by ( David Goldman | ) edition.cnn.com time to read: +6 min

New York CNN —Credit Suisse, hobbled for decades by mismanagement, scandal and bad bets, finally succumbed to the emerging global banking crisis. In the United States, the banking crisis began nearly two weeks ago with the sudden collapses of Silicon Valley Bank and Signature Bank over a three-day span. That sent shockwaves through the global banking system. Good news and bad newsThe good news: Those loans do not indicate anything inherently wrong with the global banking system. But the banking system and regulators would have to calm fears before that happens system-wide.

First Republic Bank was forced to seek a lifeline this week, receiving tens of billions of dollars from other banks. These are known as unrealized losses — they turn into real losses only if the banks have to sell the assets. +2 % 0 –4 First Republic Pacific Western Signature −8 Plotted quarterly ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 +2 % 0 –4 Silicon Valley Western Alliance Zions −8 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 +2 % 0 First Republic Pacific Western Signature –4 −8 Plotted quarterly ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 +2 % 0 Silicon Valley Western Alliance Zions –4 −8 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 +2 % 0 First Republic Pacific Western Signature –4 −8 Plotted quarterly ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 +2 % 0 Silicon Valley Western Alliance Zions –4 −8 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 Source: Federal Financial Institutions Examination Council Note: Includes both “held-to-maturity” and “available-for-sale” securities, meaning both long- and short-term investments. Banks’ cash and noncash assets Plotted quarterly $200 billion Pacific Western Signature 150 100 First Republic 50 0 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 $200 billion Western Alliance Zions 150 100 50 Silicon Valley 0 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 Banks’ cash and noncash assets $200 billion Pacific Western Signature 150 100 50 First Republic 0 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 $200 billion Western Alliance Zions 150 100 50 Silicon Valley 0 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 ’19 ’20 ’21 ’22 Source: Federal Financial Institutions Examination CouncilMidsize banks like SVB do not have the same regulatory oversight as the nation’s biggest banks, who, among other provisions, are subject to tougher requirements to have a certain amount of reserves in moments of crisis. Last weekend, the Fed announced a program that offers loans of up to one year to banks using the banks’ government bonds and certain other assets as collateral.

☆ What caused the global banking crisis this week and will it lead to a recession?
▼ + stars: | 2023-03-17 | by ( Mark Thompson | ) edition.cnn.com time to read: +7 min

Silicon Valley Bank’s customers were frantically pulling their money from the California-based lender before US regulators intervened to take control. Thursday, March 16 — First Republic Bank was teetering on the brink as customers withdrew their deposits. In guaranteeing all deposits at Silicon Valley Bank and Republic Bank, the US Federal Reserve is on the hook for $140 billion. Then there’s the $54 billion the Swiss National Bank offered Credit Suisse in the form of an emergency loan. The $318 billion the Fed has loaned in total to the financial system is about half what was extended during the global financial crisis.

☆ Howard: The market is teetering on the trend line of going negative, now is not the time to be a bull
▼ + stars: | 2023-03-16 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailHoward: The market is teetering on the trend line of going negative, now is not the time to be a bullVance Howard, CEO and portfolio manager at Howard Capital Management, discusses how the banking crisis events in the U.S. and Europe have changed his mindset over just how fully invested people should be right now.

☆ Why Silicon Valley Bank collapsed and what it could mean
▼ + stars: | 2023-03-13 | by ( Hanna Ziady | ) edition.cnn.com time to read: +7 min

London CNN —Silicon Valley Bank collapsed with astounding speed on Friday. A Brinks armored truck sits parked in front of the shuttered Silicon Valley Bank headquarters on March 10, 2023 in Santa Clara, California, United States. Established in 1983, Silicon Valley Bank was, just before collapsing, America’s 16th largest commercial bank. Like many other banks, SVB ploughed billions into US government bonds during the era of near-zero interest rates. By Friday morning, trading in SVB shares was halted and it had abandoned efforts to raise capital or find a buyer.

☆ Premarket stocks: From Wile E. Coyote to edibles: Recession forecasts are getting weird
▼ + stars: | 2023-03-13 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +12 min

And for the US economy, it could likely mean a “Wile E. Coyote moment,” Summers said — if we run off the cliff, gravity will eventually win out. AntibioticsWhen describing the state of the economy, Summers doesn’t just rely on Looney Tunes. “Will working people be better off if we just walk away from our jobs and inflation remains 5% or 6%?” Powell replied. Before the Bell: Is it necessary to increase the unemployment rate to successfully fight inflation? In a related action, the government shut down Signature Bank, a regional bank that was teetering on the brink of collapse in recent days.

☆ US futures and Asia Pacific stocks react to SVB recovery efforts
▼ + stars: | 2023-03-13 | by ( Michelle Toh | ) edition.cnn.com time to read: +4 min

On Sunday, the Biden administration promised that customers of the failed Silicon Valley Bank (SVB) and Signature Bank would have access to all their money starting Monday. In a joint statement, US Treasury Secretary Janet Yellen, Federal Reserve Chair Jerome Powell and Federal Deposit Insurance Corporation Chairman Martin J. Gruenberg said the FDIC will make SVB and Signature Bank’s customers whole. In a related action, the government shut down Signature Bank, a regional bank that was teetering on the brink of collapse in recent days. “Cross-asset traders of all stripes are heaving a sigh of relief as bank runs have a tendency to catch on globally,” he told CNN. Bank shares in Asia were under pressure Monday, following a heavy rout for their US and European counterparts late last week.

☆ Bed Bath & Beyond raises $135 million more to aid turnaround effort
▼ + stars: | 2023-03-08 | by ( ) www.reuters.com time to read: +1 min

March 8 (Reuters) - Bed Bath & Beyond Inc (BBBY.O) said on Wednesday it had raised another $135 million in an equity offering and was in the process of rebuilding its business after teetering on the brink of bankruptcy. The retailer has so far raised $360 million out of the roughly $1 billion that it planned in a complex deal of preferred stock and warrant offerings. "Over the past month, we have been rebuilding our financial and operational positioning to execute our customer-focused turnaround plans," Chief Executive Sue Gove said in a statement. In January, the company raised doubts about its ability to continue as a going concern, just months after it announced job cuts and 150 store closures. Reporting by Uday Sampath in Bengaluru; Editing by Devika SyamnathOur Standards: The Thomson Reuters Trust Principles.

☆ South Korea's slowest inflation in 10 months bolsters views for no more hikes
▼ + stars: | 2023-03-07 | by ( ) www.cnbc.com time to read: +1 min

South Korea's consumer inflation for February hit its slowest pace in 10 months, bolstering views that the central bank is done with its current policy tightening cycle after it held rates steady last month. The consumer price index rose 4.8% in February from a year before, Statistics Korea data showed on Monday, easing from January's 5.2%. It was below the 5.1% tipped in a Reuters poll, and was also the lowest rate since April 2022. "It was encouraging that the rising pace of private service prices slowed, lowering the possibility of additional rate hikes by the central bank, at least on the domestic side," said Ahn Jae-kyun, a fixed-income analyst at Shinhan Securities. Annual core inflation, which excludes volatile food and energy prices, inched down to 4.0%, from 4.1% a month before, and hit the lowest since August, suggesting easing underlying price pressure.

☆ Elon Musk faces upwards of $130 million in legal costs to fight laid off Twitter workers over severance pay
▼ + stars: | 2023-02-24 | by ( Kali Hays | ) www.businessinsider.com time to read: +5 min

Elon Musk last month offered thousands of laid off Twitter workers a limited severance deal. The former workers, laid off in November, say they were promised much better severance than what Musk finally offered them last month. In addition, laid off Twitter employees also filed a handful of class action lawsuits in federal court. It also effectively prohibits them from ever speaking about Musk, Twitter, or their experience at the company. Even those relatively few Twitter workers who signed off on Musk's severance agreement could speak freely about the company going forward.

☆ Elon Musk faces upward of $130 million in legal costs to fight laid-off Twitter workers over severance pay
▼ + stars: | 2023-02-24 | by ( Kali Hays | ) www.businessinsider.com time to read: +5 min

Elon Musk last month offered thousands of laid-off Twitter workers a limited severance deal. In addition, laid-off Twitter employees also filed a handful of class-action lawsuits in federal court. Instead, Musk is offering laid-off workers one month of base pay as severance. It also effectively prohibits them from ever speaking about Musk, Twitter, or their experience at the company. Even those relatively few Twitter workers who signed off on Musk's severance agreement could speak freely about the company going forward.

☆ G20 finance leaders to gauge toll on global economy on Ukraine war's anniversary
▼ + stars: | 2023-02-24 | by ( David Lawder | ) www.reuters.com time to read: +3 min

BENGALURU, Feb 24 (Reuters) - Global finance leaders will tally the economic damage from Russia's war in Ukraine on Friday as they meet on the conflict's first anniversary with some voicing concerns that more sanctions on Moscow would disrupt a modest improvement in growth. U.S. Treasury Secretary Janet Yellen on Thursday highlighted the improvement, saying the global economy "is in a better place today than many predicted just a few months ago". Yellen and fellow G7 ministers on Thursday called for more financial support for Ukraine and vowed to maintain tough sanctions on Russia. German Finance Minister Christian Lindner said the pressure on Russia must be kept high to "completely isolate" Russia's economy. Yellen said the communique was still under discussion and she hoped to see a strong condemnation of Russia's invasion and the damage it has caused Ukraine and the global economy.

Participants at the meeting, however, are likely to focus on the war in Ukraine. The G20 bloc includes the wealthy G7 democracies, as well as Russia, China, India, Brazil and Saudi Arabia. French Finance Minister Bruno Le Maire told Reuters that G20 financial leaders must condemn Russia's aggression against Ukraine and that Europe was working on new sanctions against Moscow. G7 chair Japan's finance minister, Sunichi Suzuki, told reporters that the group would closely monitor the effectiveness of sanctions and "take further actions as needed". German Finance Minister Christian Lindner said the pressure on Russia must be kept high to "completely isolate" Russia's economy.

☆ British supermarkets confront their German discounting demons
▼ + stars: | 2023-02-22 | by ( James Davey | ) www.reuters.com time to read: +5 min

And the discounters' supermarket sweep still has a long way to run, industry executives say, with Aldi UK CEO Giles Hurley pledging Britain's lowest prices "no matter what". "Over the Christmas period alone shoppers switched 58 million pounds ($70 million)(of purchases) to Lidl from Tesco and Sainsbury's," Lidl GB CEO Ryan McDonnell told Reuters. Tesco and Sainsbury's are now matching Aldi prices on hundreds of key items and using customer loyalty schemes, while they have accepted a profit hit to keep prices down. Sector executives, speaking on condition of anonymity, said the further rise of Aldi and Lidl is inexorable. "Nobody's going to take Tesco out but at some point somebody might take Sainsbury's out," the sector veteran said.

☆ Three Years Into Covid, We Still Don’t Know How to Talk About It
▼ + stars: | 2023-02-22 | by ( Jon Mooallem | Photographs Ashley Gilbertson | ) www.nytimes.com time to read: +53 min

It will play out and reverberate for years or decades, Hagen told me. “The pathological normal,” Hagen calls it: a patchwork of homespun, bespoke realities, each one invested in a different story about what exactly happened when Covid ruptured the story of our lives. garb.”More than once, life seemed to be attaining “an uncanny resemblance to normal life,” as one man put it. But because we don’t totally understand where that experience has delivered us, we don’t know the right gloss to give it. “The days are strange,” one public-school teacher told Milstein toward the end of his first interview, in May 2020.

☆ FTSE100 stocks have been shunned for years. Now investors love them
▼ + stars: | 2023-02-17 | by ( Anna Cooban | ) edition.cnn.com time to read: +6 min

Both US indexes have recovered slightly following last year’s big falls, but one of the biggest drags on their performance — high interest rates — is likely to stick around. That’s because, when interest rates are low, the yields on government bonds are also low. That boosts investors’ appetite for riskier investments, such as the stocks of small or highly indebted tech companies that could make blockbuster returns years down the line. BP (BP) and Shell (SHLX), both FTSE companies, more than doubled their annual profits last year to a combined $68 billion. But the lack of tech companies may come back to haunt the FTSE, once inflation and interest rates fall back.

☆ Japan logs record merchandise trade deficit in January as export growth slows
▼ + stars: | 2023-02-16 | by ( ) www.cnbc.com time to read: +2 min

A flag of Japan flies near cargo containers at Tokyo's Odaiba Waterfront on August 6, 2020. Growth in Japan's merchandise exports slowed sharply in January amid weakening Chinese demand for cars and chipmaking machinery, stoking concern about a global slowdown and creating the country's largest trade deficit on record. Trade figures issued on Thursday followed weaker-than-expected gross domestic product data, underscoring the challenge for the Bank of Japan in achieving growth led by private demand while stably sustaining inflation above 2%. "In a nutshell, exports are weakening," said Taro Saito, chief economist at NLI Research Institute. The result was a 3.49 trillion yen ($26.07 billion) deficit in merchandise trade in January, the biggest in records going back to 1979, the data showed.

☆ Japan logs record merchandise trade deficit in Jan as export growth slows
▼ + stars: | 2023-02-16 | by ( Tetsushi Kajimoto | ) www.reuters.com time to read: +3 min

Summary Jan merchandise exports +3.5% yr/yr vs forecast +0.8%Imports +17.8% yr/yr vs forecast +18.4%Trade deficit at record Y3.49 trln vs forecast Y3.87 trillionCommodity inflation peaking but trade deficit to linger -analystTOKYO, Feb 16 (Reuters) - Growth in Japan's merchandise exports slowed sharply in January amid weakening Chinese demand for cars and chipmaking machinery, stoking concern about a global slowdown and creating the country's largest trade deficit on record. Trade figures issued on Thursday followed weaker-than-expected gross domestic product data, underscoring the challenge for the Bank of Japan in achieving growth led by private demand while stably sustaining inflation above 2%. The result was a 3.49 trillion yen ($26.07 billion) deficit in merchandise trade in January, the biggest in records going back to 1979, the data showed. Data issued on Monday showed Japan's economy, the world's third largest, had grown at an annualised rate of only 0.6 in the fourth quarter as business investment slumped. Japan reports trade in services separately, in its current account data.

☆ The tech meltdown comes for Gen Z
▼ + stars: | 2023-02-14 | by ( Aki Ito | ) www.businessinsider.com time to read: +7 min

The tech industry was teetering, and she wondered whether the future she had banked on would survive. On Handshake, a leading jobs board for college students, entry-level software positions in the tech industry slumped 14% last year. "I'm finding that students are pivoting to organizations that have IT functions but are not in the tech industry," says Laura Garcia, director of career education at Georgia Tech. Given the seismic downturn in tech, some students are rethinking their dreams of working for the Amazons and Googles and Metas of the world. Suddenly, in the eyes of Gen Z, tech seems to be just as ruthless and unreliable of an employer as banking did to millennials who came of age in the Great Recession.

☆ Excavators start removing debris in Turkish region hit by earthquake
▼ + stars: | 2023-02-13 | by ( ) www.reuters.com time to read: +1 min

HATAY PROVINCE, Turkey, Feb 13 (Reuters) - Excavators began removing debris from an urban area in Turkey's southern Hatay province that was devastated by last week's massive earthquake, drone footage showed on Monday, as the operation to find survivors started drawing to a close. Several large hydraulic excavators, near the city of Antakya, scraped at piles of masonry or knocked down the tops of teetering concrete buildings, footage showed, with clouds of dust rising from the rubble as slabs of concrete fell. Extractors remove debris from demolished buildings, following the deadly earthquake in Iskenderun, Turkey, February 11, 2023. Some onlookers sat on broken sofas and armchairs from buildings that were opened up by Monday's huge quake, which shattered a swathe of southern Turkey and northwest Syria. Reporting by Christina Fincher; Editing by Edmund BlairOur Standards: The Thomson Reuters Trust Principles.

☆ US stocks end mixed after volatile session as indexes notch weekly losses
▼ + stars: | 2023-02-10 | by ( Brian Evans | ) www.businessinsider.com time to read: +1 min

US stocks closed mixed on Friday after a volatile trading session amid weak earnings reports. The S&P 500 suffered its first weekly loss in three weeks and notched its worst one-week decline since December. But the Nasdaq led the weekly sell-off with a drop of more than 2%. The S&P 500 suffered its first weekly loss in three weeks and notched its worst one-week decline since December. Trading on Friday began in the red amid some weak earnings reports.

☆ Bed Bath & Beyond is closing 149 more stores. See the list
▼ + stars: | 2023-02-09 | by ( Jordan Valinsky | ) edition.cnn.com time to read: +1 min

New York CNN —Bed Bath & Beyond has revealed the locations of the 149 stores it’s closing. The new list of closures comes just a week after it announced it was shuttering 87 other stores. In total, the company is reducing the number of Bed Bath & Beyond stores from 760 to about 360, with the company keeping its most profitable stores open in key markets. Notably, this week’s list includes closures in 13 new states that weren’t included in last week’s store-closing list. These are the locations Bed Bath & Beyond plans to close in the coming weeks:

☆ Here's why the US economy won't fall into a recession this year or next, according to a key market signal
▼ + stars: | 2023-02-07 | by ( Phil Rosen | ) www.businessinsider.com time to read: +5 min

In that case, it may be wise to heed a key bond market signal that's saying we'll avoid a recession after all. But if you look at the bond market, there's a clear answer that seems to be forming: The US economy won't enter a downturn this year or next. That's because the spread between corporate bonds and Treasury yields is steadily narrowing, according to DataTrek Research. The spread between corporate bond yields and US Treasuries helps measure the risk appetite of bond traders. Strategists warned that markets have yet to price in an earnings recession, which could pose a major headwind in 2023.

"They fire, we hire," said Rainer Zugehoer, Chief People Officer at Cariad, the software subsidiary of automaker Volkswagen (VOWG_p.DE). Spooked by inflation and the prospect of recession, Google parent Alphabet (GOOGL.O), Microsoft (MSFT.O) and Facebook owner Meta (META.O) have announced a combined almost 40,000 job cuts. Germany, with one of the world's oldest populations, has gaping holes in its labour force: according to IT industry group Bitkom, 137,000 IT jobs are unfilled. Gerlach added, adding Munich's famed beer festival to the strong labour protections that might prove attractive to the newly jobless. "Bureaucracy in Germany is utterly crippling for most highly-qualified workers when they first encounter it, especially if they don't speak German," said Diana Stoleru of Berlin startup Lendis.

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