Good morning. Hello. How are you? #843
More Daddy Jane Dance Party, more SVB stuff, a Twitter argument with the guy who sings "Take the Skinheads Bowling" and RIP LGA Airtrain.
Good morning. Hello. How are you? You feeling awake? I feel so tired. In one of those sleep k-holes where you get more sleep and it doesn’t help. Okay. I only got about seven and a half hours last night but still. I feel sleepy beyond that. I blame daylight savings time. Jane did not want to go to sleep last night it was a real chore. I blame daylight savings time for that too.
We had a good Daddy Jane Dance Party, though. It was an hour long because when she finished pooping I said “the faster you get teeth and jammies done the longer we can do dance party” and man, she just rushed through teeth and jammies in, like, 3 minutes, compared to the usual 30 or so minutes. So, you know, 60+ minutes of aerobic activity in the evening. My Apple Fitness rings loved it, and it was super fun, but I guess it wore me out. Anyway, we started with another Katy Perry video, “Hot N Cold,” which I randomly get stuck in my head all the time. Then “Since U Been Gone,” which Jane liked very much once she got over the misspelling of “you,” which she was not okay with. Dancing to that one took me back to Common Ground and Love Night and it was really fun. Then we did “Twiggy Twiggy” by Pizzicato Five, which I hadn’t heard in ages and it is still a great song. Then I started working my way back in time with “Love Shack,” “Groove is in the Heart,” Tony Basil’s “Mickey,” and then I went off the beaten path a bit with We’ve Got a Fuzzbox and We’re Gonna Use It and “Love is the Slug,” which actually has a pretty hilarious kid-friendly video. Then the two Kim Wilde hits, “Kids in America” and “You Keep me Hanging On,” then Strawberry Switchblade with their Dolly Parton cover and “Since Yesterday.” Then Bananarama’s “Venus” and “Cruel Summer,” Nina’s “99 Luftbaloons” (German version, natch) and ended with Robyn again, where we taught a dance class to the stuffed animals.
My heart loves all this dancing — both literally and metaphorically. My back, not so much. Jane makes me spin her once per song, which is exhausting, and now we’re doing that move where I swing her up, and then down between my legs and back up again and man. That does a number on my back, but it’s also a number that probably needs to be done. Anyway I can feel it getting easier, all this dancing, each time we do daddy Jane dance party. It’s kind of nice. Good to get some aerobics in, in addition to my normal heart-pumping uphill walking. But man. I feel so old.
So I don’t think this whole bank thing is over and I don’t think people really grasp just how close we were yesterday to a bunch more banks failing, even with the government’s actions. But I do think we’re in a better place, and it was nice to not see First Republic and, you know, Charles Schwab fail yesterday. Yesterday morning was a pretty stressful time, really felt like we were on the brink, especially when I talked to my banker friends.
Couple more thoughts for today.
First, In a lot of ways, SVB got a bum deal. Like… a bunch of other banks were about to go under on Monday as well, but now those banks get to borrow against their bond investments at par — exactly the act that would have saved SVB. But SVB is gone and it looks like no one wants it. Well, one Republican Senator from the Midwest whose name I can’t remember (there are so many) said that there actually was a buyer, but that the white house put the kibosh on it. Which is really something. Biden would rather a bank fail than get bought by JPM. I mean, I guess fair enough. But still. Seems iffy.
I definitely think that this whole situation is pretty much the end of any banking for tech startups. It is going to get harder and harder for them to even get a bank account. Which means they will aggregate, once again, in some VC-backed NewBank, which will be tech focused, and, thus, always more at risk than a normal bank. It seems pretty clear now that the run we did have — as opposed to the one that might have happened if it were left unchecked — was almost exclusively in the tech sector. They took down their own bank, then Signature got hit because of it’s crypto connections and First Republic was going down because it was always the second favorite bank of tech peeps. This is not to say that the contagion wasn’t going to spread beyond this, but in the end, it was stopped. For now.
So this means that no bank is going to want tech deposits. Why would you take desposits from a cohort of depositors who are actively excited about taking down your bank. Just not worth the hassle. It strikes me that this is all very, very bad for Silicon Valley. More than they are willing to admit. Maybe I’m exaggerating, but I can see a path where this is a permanent scar on Silicon Valley. They look like keystone cops. Why would you trust them with anything. In and of itself, it is probably not going to kill off the valley, but I suspect it’s much, much worse than we’re realizing.
I also suspect this entire thing is going to get pinned on Peter Thiel in the end in the valley, and I suspect they’re going to be unhappy with him for it. Sure some will extoll his prowess about timing it and getting out, but I think mostly, over time, they’ll think “that fucker killed our bank.”
Then again maybe all of that is wishful thinking what do I know. Well, the one thing I do know is that if I were ever doing another tech company I would probably have to open a bank account at my local community bank and personally guarantee the whole thing because who else is going to want to do that for me.
So, you know, good luck 20 year old kid who has no banking relationships I guess. Maybe you can get your dad to cosign on your bank account for the next Google.
And then we have Jerome Powell. We’re getting inflation data today. Everyone seems to think Powell has no choice now but to lower interest rates but I’m not so sure. That guy has been saying all along there was going to be pain in his actions. So there are two ways to look at it: was Wall Street blithely assuming the damage would only be to the plebes with higher unemployment (which, of course, helps them), and therefore they’re in for a rude surprise when Powell hurts them with his next bank rise? Or is Powell in on the fix and only ever intended to hurt the common man with increased unemployment and now that he’s hurting some rich people he might pull back? I feel pretty deeply cynical about Powell in general so both of those approaches might be plausible, but my gut tells me he has a boner Paul Volcker and will keep increasing interest rates because who’s gonna stop him. The governors, maybe. I don’t know. Maybe. And maybe my cynicism in all of this is going into over time. It’s too hard to tell. But I will certainly not be surprised if rates go up. Which means I guess I’m predicting that he’ll keep them flat.
Also the whole introduction of Barney Frank as a banking villian is simultaneously deeply disappointing but also not surprising I guess. I guess I just assumed that after his stellar run in congress he was living out his days having a grand old time in P-Town or something. He had said at the time that it was time to quit congress because he wanted to go have fun or something like that. But I guess having fun means being a bank board member. Seems obvious in retrospect but, alas, I expected more of him. Boo.
Oh I forgot to tell you about the part where I made a horrible mistake and got into a Twitter argument about the SVB bailout with Dave Lowery, lead singer of Cracker and Camper van Beethoven, who absolutely refuses to acknowlege or believe that anyone who used SVB bank used it to make payroll or pay, you know, normies. He is adamant and insistent that everyone who used SVB bank was a plutocrat. I tried to have a good faith discussion but he proceeded to first call me a fake account, even though I’ve been on Twitter two years longer than him and use my real name. Then he Googled me, found my current job and said I must be a shill. I explained kindly to him that my resume goes a bit deeper than that, and that we’d actually met before and have mutual friends. Then he said “can’t believe an asshole like you has friends.” All because I talked about normal people needing to get their paychecks. It really was something. He also quote tweeted incesantly instead of having a normal conversation which makes the whole thread somewhat difficult to follow. But here you can have this one because I like to imagine a time machine and my 16 year-old self learning about this whole surreal episode involving the guy who sang “Take the skinheads bowling.” I’ll always have him to thank for learning about the Status Quo, though.
Anyway, maybe today we can have a normal day.
It seems that Cuomo’s dumb AirTrain is finally dead once and for all, thanks be. This is the correct decision. Unfortunately in the process, it seems that they killed off the only real solution, a train from Queens. They’re gonna go with busses. Which, of course, means everyone will still take Taxis. The new plan seems cheap, which is good, and will have some effect, so I guess it’s worth doing. But it’s not a replacement of a train. But at least we’re not going to build a train in the wrong direction, score one for common sense.
Anyway there’s a whole report from PANYNJ that I am gonna download and send to my Kindle and read I’ll give you a full report someday I know you LGA buffs expect nothing less of me.
Got a “W Hotel Lobby in a Better, Alternate Universe” playlist for you today. Anyone been to a W Hotel lately? Send me a recording of the lobby. Man, I used to spend half my life in those hotels. I had this client Mitch who had his suite in the Union Square W remodeled to his liking. That basement bar in that one went through some vicissitudes but a few incarnations were a pretty solid sitting-at-the-bar-and-drink-in-quiet-peace variations, between it’s assorted endeavors to be a night club. Anyway, De La Soul back on Spotify as we know, all very exciting. Very into this Uncle Waffles, know nothing about them need to google. New Lil Yachty is a thrilling chaotic absurdity I kinda love it. And very excited about all the new Everything But the Girl tracks. Think I might splurge on that one on vinyl. TBD. Trying to cut down.
i had dinner last night with a couple of old friends, one of whom is a lobbyist, and he said no one seems to be aware of how close the country came to financial collapse owing to this tech bank fail. (i had to agree with him—i had no idea!)
david lowery seems like a dick who's only interested in being right.