i don’t understand this stuff, so sometime help me out please. this chart represents “unrealized losses” on long term securities. rather than actual money loss, does this mean the valuation of the securities they are holding have dropped? or something else? unrealized Los just means the assets they hold have less value in this current moment, yeah?
Yeah, so long as nobody sells those assets the loss is “unrealized”.
Like… Your neighbor buys their house for 200,000. They watch the housing market in the are and keep track of the estimated sale price for their house.
If this year, their house could potentially sell for 250,000 but they don’t sell. You could think of it as an unrealized “gain”.
If next year, their house could potentially sell for 190,000 but they don’t sell. You could think of it as an unrealized “loss”.
alright, thank you for the explanation :D
You are entirely correct. Unrealised vs realised gains/losses are important for tax purposes, since the latter count towards taxes while the former don’t.
“It’s OVER the USA’s economy is about to COLLAPSE. 30 days until the END.”
I may have found my new YouTube grift.
Holy shit 2022 was a bad year, did they discover options?
I think that was the year where they bought treasuries with zero interest and then the rates suddenly went up, making the ones they just bought worthless
This is an amazing graph.
truly
The collapse of Silicon Valley Bank was bad enough but it was already clear then that this is a structural problem.
Wow seems bad
Total unrealized losses of $413.2 billion decreased $67.5 billion (14 percent) from the prior quarter. Longer-term interest rates such as the 30-year mortgage rate and the 10-year Treasury rate decreased in the first quarter, increasing the value of securities reported by banks and lowering unrealized losses. However, increases in longer-term interest rates since the end of the first quarter would likely reverse most of these improvements in unrealized losses if measured today.
This part doesn’t make sense to me. Why would lower long term interest rates increase the values of securities? Is it because people would pay a higher premium for securities locked in with a (example) 5% face value interest if the broader economy had (example) 3% interest?
I mean ok, that kind of does make sense to me. But then this really makes me wonder why the hell the feds aren’t cutting interest rates, even at the expense of the banks and the government. Who is even benefiting from the high interest rates?
People with lots of money benefit from high interest rates, and they’re an important weapon in class warfare. Higher interest rates push more people into accepting worse labour conditons.
Who is even benefiting from the high interest rates?
People with lots of liquid capital. They can lend money to the rest of us without money using those high interest rates to figure out how much they can make off of us poor folks.
People riding out the SAVE student loan forbearance benefit from higher rates on cash and cash equivalents
Christian Bale in the Big Short dot jaypeg
Michael Burry just made some big calls irl
Probably some Christian Bale in American Psycho to go with it.
When I typed this out I accidentally called him Patrick Bateman in the Big Short. So I guess it’s close enough
Given that money is fake what does this mean. Already things are as bad as we have ever known them here. Are we talking 70s style stagflation 08 style crash? Cause essentially they already lost this money they just are pretending they haven’t and it is working for now yeah?
A 08 style crash seems likely at this point, and Trump’s volatile policy could act as a catalyst for the unraveling of the economy. For example, if he restarts trade war with China after 90 days ceasefire expires that could act as an economic shock that creates a panic in the markets.
While money is a social construct, it still represents obligations within the rules of the existing social system. In that sense it’s very much real. If financial entities end up with bad debt they cannot service then it will make them go out of business, people will lose jobs, and so on.
😔
