Good morning. Hello. How are you? #842
Weekend! Oscars! Pulling back from the brink of financial collapse! Starting seeds for the spring!
Good morning! Hello there. How are you? Happy weekend? Welcome home to all those astronauts who just landed back on earth after five months. Congratulations to Sarah Polley for winning best adapted screenplay. Sarah Polley’s journey from famed childhood actor to successful adult director and screenwriter really is something. Sarah Polley is a national treasure. A Canadian national Treasure. And congratulations to Everything Everywhere All At Once. I liked it a lot. Went a little long, got a little meandering there for a bit. But it was remarkably inventive and uplifting and I am happy it won I don’t think anything else really deserved it except for maybe TÁR, but in the end you gotta go with the people pleaser I suppose.
I did not watch the Oscars last night. I was still decompressing from the near total implosion of our economy over the weekend and it seemed a bit too decadent. Also I don’t have the ABC app on my Apple TV and I wasn’t going to go switch over to CABLE, that would be crazy.
I would like to apologize for writing “white night” instead of “white knight” in my Friday edition of GMHHAY. Clearly I was referring to the underrated 1985 cold war thriller starring Gregory Hines, Mikhail Baryshnikov, Hellen Mirren and Isabella Rosellini. You know, the one that spawned the fantastic hit “Say You Say Me” by the incomparable Lionel Ritchie. Man I loved that song. Learned it on the piano. Still have the printed score.
Anyway, aside from the paranoia that the entire financial markets were going to collapse, it was a pretty great weekend. Lots of productivity and even a little down time. Made the waffles (gofres) and Tom Yum Bone Broth and rotated my mattress and replaced the filter in my air filter in my bedroom, rebalanced by 401k took out the compost my god I am a good little domestician. Learned how to cut trails through the woods without using a tractor — let me introduce you to the greatest new tool I learned about, the Extratigator Big Daddy. Thing looks amazing. Also did you know you can take a tree down, root ball and all, with just a comealong and some chain. Amazing. This video was life changing. Also I want exactly this greenhouse and I think I might try and build it. Refilled the pills because I am an old man, cleaned my mirror, dealt with Jane and daylight savings time which has (so far) mostly gone well.
But the most exciting and productive thing is that I started my seeds for the spring. And Jane helped. And it was so much fun. She was genuinely useful. We didn’t go too overboard on the seedlings — a lot of things I am convinced are better if you just start them in the ground. But we did tomatoes and peppers, and broccoli and cauliflower (which probably aren’t gonna make it before it gets too hot but it was a cheap experiment), basil, cucumbers and beans. Everything else will go straight into the ground. Still, though. It was so fun. Jane was just great. Real success.
So I don’t think most people realize how bad things were this weekend. In the end the government “did the right thing,” and, you know, kept the entire bank system from collapsing. Which was a thing, yes. It was imminent, everyone who works in it seems to agree. Every bank save for maybe JPM, Citi and BofA were more or less in trouble. Certainly every community bank. And this was without most people still paying attention. If we got to this morning and two or three more banks failed, and people suddenly realized this wasn’t just another episode in the culture wars and not contained to tech then more people would have started freaking out. Signature bank went down. First Republic was imminent — shit, First Republic might still go down this morning, too soon to say.
One thing that is new is the speed which these things can happen now, especially, paradoxically, at banks that have good customer service and solid web capabilities and, you know, let you initiate wires over the weekend. The thing about First Republic is right now none of us really have any idea how many people initiated wires over the weekend taking their money out of First Republic. Or any bank, really, that lets you wire money from the web. SVB happened during the week so we could see it happening and they could stop the wires when they ran out of money. But on the weekends, banks still accept wire requests, and then just initiate them all on Monday morning. So what’s right now when all those wires start hitting? ¯\_(ツ)_/¯
It seems clear there was no buyer for SVB. The time for a buyer was Thursday. It is unclear to me why that didn’t happen. The writing was on the wall. I can only assume that SVB’s leadership did not accept their fate at that time. But in any case, by the time the FDIC initiated an auction for SVB Saturday morning, most of the damage was done. The largest bank failure ever was Wamu. It’s bank run was $16.7 billion in deposits during a 9-day bank run. SVB was more than forty billion in one day. Wamu’s bank run was 9% of its deposits. SVBs seems to have been about a quarter. Bank runs are far, far more intense these days. Once the feds took over SVB, and said that the depositers might not be made whole — something they kept reiterating from Thursday through Sunday, even as every time they said it the bank system faltered a little more — SVB’s brand was almost completely useless. Add in the fact that the White House apparently made clear that they did not want a big bank to own SVB, and the case was sealed. Every bank in America that was not a “big bank” was worried about failing this weekend, no bank was big and solid enough to take on a behemoth tarnished asset.
Was SVB badly run? Maybe? It made a bunch of entirely rational investment decisions that did not pay off. It bought a lot of long-term bonds, many of them in the middle of the pandemic, when it seemed entirely reasonable to assume interest rates were going to stay low. So did other banks. It bought a lot more of them than other banks. That was a bad call. But the investments themselves were hardly irresponsible or risky.
Did SVB’s singular depositor base make a difference? Yes, but maybe less than people are thinking. What is the difference between SVB and any other community bank. When I bought my house, our local community bank gave us a loan with the caveat that we keep our money there. Exactly the same requirements as SVB had. Is my community any less singular of a depositor base here in rural Chatham County as SVB was, with depositors across the country in tech and life sciences?
I never particularly liked SVB. I did not trust them. Not so much because I thought they were greedy, or I thought that they were making bad investments or anything. Not because of the culture wars and much of America’s distruct of tech. I didn’t like them because they didn’t seem to understand New York, they brought their Silicon Valley ways to the New York tech scene which was in a different state of development. They seemed to try to pick winners and losers and they just didn’t seem to fit into the New York tech community. It was never particularly rational. If Timehop had (still) been using them when I first got this job, I probably would have kept using them. Maybe I would have even grown to like them. Their clients certainly seemed to. Which, you know, does say a lot about a bank cuz lord knows I have five and I hate them all.
What are Jerome and the Fed thinking right now. They brought the economy to the brink of disaster with their interest rate hikes. Was it their fault? ehhh… arguable either way, but their actions had a giant hand in it. They CLEARLY want to keep raising rates but everyone is expecting them to stop now but they may well see this whole thing as evidence that they need to keep going. It’s an even bigger question mark and drag hanging over the economy than the previous resignation we all felt for the interest rate beatings continuing until morale improves.
So here we are, 8 AM Monday. World could have been ending today. But it (presumably) won’t. Hopefully it was enough. We shall see, we shall see. I give it abotu a 75% chance.
I have so much more to say about all this. But I will stop.
Fake booze kick is going nicely. My negroni really is nearly indistinguishable now. Or maybe I’m just getting used to it. But that Ish Gin really is the greatest thing. Throat kick! Ish makes a Tequila and a Rum too might have to try those. No whiskey, alas. Seems like no one makes a good whiskey I have tried four. If I mix two or three of them together and add some old fashioned mix I had laying around it makes a passable old fashioned, but no sipping whiskey.
But what is really fantastic is this Pathfinder stuff (thank you, Ingo). It is now sold out everywhere, I seem to have gotten one of the last bottles online but my god it’s so good it is a fantastic fernet replacement. Strong reccommend. As soon as it’s back in stock I am stocking up.
Anyway, the whole experiment is still going great, I swear to god I feel drunk. At first I thought maybe it was the edibles but I have stopped that kick again and now it’s just the fake booze and it’s just. Wow yeah. It’s a revelation. My friend Doug mentioned that he’s had a fake beer while driving and oh my god, I can’t even imagine I might have to try that sometime that feels downright delinquent.
Jane is doing well with Daylight Savings Time. I let her sleep about 45 mins longer than usual Sunday morning. She as still sound asleep, which is weird cuz she is usually awake by the time I go in there in the morning. She had some trouble falling asleep last night, but nothing too much out of the ordinary. She seems okay right now. Fingers crossed.
Daddy Jane Dance Party was a good one last night. We did “Gangnam Style,” which had popped into my head earlier in the day and Jane asked about. That video is still a glorious absurdity. Holds up. Then a a bunch of Katy Perry, she had never heard Katy Perry so you can imagine how that would go. Then I tried one of my lesser-known lady pop singers, Allie X, who is great but wow yeah all her videos are very scary for a five year old. Then we went back to our comfort place and ended with Robyn, who she’s only known for a week but she loves. I feel very successful on that front.
Shoegaze playlist for you. Been a while. I think I might be toward the end of the bottomless Spotify shoegaze pit. The recommendations on the bottom of this playlist aren’t all awesome sounding shoegaze. That is new. Or maybe they just tweaked their algorithm. Who knows. Anyway, all new (to me) shoegaze bands except for Black Belt Eagle Scout, Sqürl and Gravenhurst. Sqürl is, of course, Jim Jarmusch’s band. Black Belt Eagle Scout is a Pacific Northwest indigenous woman shoegaze band and they’re every bit as awesome as that sounds. I am so glad I got to see them pre-pandemic. They rule.
Okay well let’s just get through this week without any more near-apocolypses shall we? Great. Maybe we can chill until the government shuts down because of the debt ceiling in a couple months.
i didn’t receive friday’s edition and was really sad until i remembered i could read it on facebook. and then i went to facebook and being there made me sad. haha.
isn’t the movie called white nights?