1/ What is an investment bank?
Let's start here:
IB =/= a "typical bank"
IBs don't take deposits, don't accept withdrawals.
They help firms buy each other & originating boatloads of new securities (equity or debt) that they then market / sell to the rest of capital markets.
🏦📉 SVB Crash Explained📉🏦
Silicon Valley Bank—#16 largest US bank with $212B — just crashed 60% in 1 day & fell 22% post-close. Stock halted now.
@BillAckman is calling a US gov bailout.
@peterthiel is calling a bank run.
JPM, BAC, WFC all dropped 6%.
What's next?
Is this (a) Lehman moment or (b) overblown?
Are depositors screwed or just equity investors?
And what do the terms "AFS", "HTM", "NII", & "FDIC Insurance" actually mean?
👇THREAD ON SVB
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