riskneutral

> email clients that don't implement CSS properly (Outlook).

Can anyone explain how this is even possible? It's 2025.

Awesome

is this better than miniconda?

my experience of trading and speculation has been the opposite. very little profit (or zero or negative profit) in return for an extraordinary amount of effort and expertise. see Acura/Honda NSX trading.

> trading just doesn’t make sense to me.

it's not complicated. suppose Bob wants to buy an Acura NSX and Kazuo wants to sell a Honda NSX. enter trader Joe. he knows Bob, and he knows Kazuo, and he knows that the Honda NSX was also marketed as the Acura NSX. trader Joe can buy the car from Kazuo, obtain an export license, arrange for shipping and tax duties, and sell the car to Bob for a profit. that is called trading.

you're thinking of "speculation." one could argue that the market needs speculators to take the risks that hedgers want to reduce. speculators might also find interesting information and improve the efficiency of market prices. traders intermediate between speculators and hedgers.

now does it make sense?

> send one or two people into the boonies ... there was the small (vanishngly small?) possibility of a good payout

This was called "wild catting." It gave people an excuse to carry TNT dynamite into the boonies and detonate explosives for fun (like fireworks for grown ups).

OK well good that you've done your research then.

Is that one for you?

Oh wow, I read this story as evidence that neural nets are not the future back when I was an undergrad studying machine learning. Maybe I should have followed my instincts back then because even then neural nets seemed intuitively very interesting even if the statistics and math professors hated them because they weren't derived from any first principals.

Time for copyright laws to be rewritten then.

I'm not a lawyer, but I'm pretty sure that's not a thing. Lying to the court is a routine part of litigation, and there is no penalty or sanction for it - especially not against the lawyers themselves.

This needs to be re-expressed as a % of GDP to be useful. And as already pointed out, the largest of them (Lehman) is missing

> Males have dominated all power structures in every society in the history of humankind

> Why are men doing this to themselves?

What you are doing here is using a tiny substrata of hyper-successful men (those who "dominated power structures" as you put it) and using that to represent the entire structure of Western society. There is nothing about that that is vaguely appropriate.

I know that those networks still exist, but literal "boys only" country clubs are no longer socially acceptable as far as I know.

> For admission to Chief, a women’s leadership network, members pay up to $7,900. That gets them executive coaching, big-name speaker sessions, a Rolodex of female executives and, for an extra cost, access to five sleek clubhouses. Chief is essentially an “old boys’ club” — for the ladies. The venture capital-backed company has grown to over 20,000 members and over $1 billion in value since it started in 2019.

So ... can we have the "old boys' clubs" back now, for the other half of the species? Somehow I don't think so.

That is a LOT of words dedicated to something that the author thinks is "ridiculous." People like this never pause to ask why they spend so much time thinking about things that they say are ridiculous fictions. I can say this because I used to be a radical materialist evangelist myself. Thankfully I grew out of that and settled into a comfortable agnosticism which I find much less exhausting.

TLDR: Lobbyists are going to use AI to ply their nefarious trade more effectively. In order to stop them, Congress needs to stop passing "monolithic, multi-thousand-page omnibus bills voted on under deadline" and instead a bill should focus on individual area and undergo through a debate and deliberation process, and we need more transparency over the activities of lobbyists. I can see how the AI part might happen, sadly the rest doesn't seem realistic at all.

They're being generous by saying it was merely a lack of competence. If they were in another mood, they could say that their aircraft was deliberately attacked in an act of war.

Imagine a convenient, Single Point of access for all your Redundancy-as-a-Service needs!

> Moody's was threatening to downgrade them, and they were forced to ac

Ah I was missing that part of the story. It turns out that SVB hired Goldman Sachs to advise them on this crazy plan and all to turn a 2 notch downgrade by Moody's into a 1 notch downgrade. Supposedly they were so rushed by Moody's that they couldn't even close the equity raise before announcing it (which is batshit crazy for a company with a public stock price to do while trying to avoid a credit downgrade). I'm not sure why SVB was surprised and caught off guard by Moody's - shouldn't they have been in communication with Moody's all along the way? Not sure what to think about Goldman's involvement, are they incompetent too?

But of all this just makes me agree even more with the employee quoted in the article. If you are facing these kinds of problems as a bank CEO, get on a plane to the Middle East and get a Sovereign Wealth Fund to close your funding gap, instead of publicly announcing that you'll raise equity just to satisfy a Moody's rating analyst. Because, as we now know, your stock will crater, your new equity investor will walk away, and your customers will start a run on your bank, and by Monday you will have lost your shirt.

How bank runs were historically handled in the US is that the depositors lost all of their money. Banks runs are a recurring problem that have a history going back hundreds of years. That's changing now though, the SVB depositors will be made whole by the government in order to avoid a wider banking crisis and what that means for everyone else is TBD but it looks like some form of insurance that's better than $250k.

Yes. I learned that the VC industry, at the company management level and even at the venture capital management level, had a very poor understanding of banking. Some crazy percentage of VCs used one particular small regional bank for their funds, they told their portfolio companies to do the same, and everyone even banked their personal accounts with the same bank. Somehow, an entire industry was unaware that you need to manage and diversify counterparty credit risk - even when you are dealing with banks. It's amazing to me that this could happen. I can understand why startup founders might not be aware of banking risks, since banking is not expected to be their expertise and they might have been children the last time a major bank went under. But how did the VCs miss this? This would have been the equivalent of a nuclear detonation in their industry, had the government not bailed them out. I guess we could charitably think of this as part of the process of the VC industry maturing and become a larger part of the economy. Now they'll hopefully better diversify their banking relationships, and the banking industry and regulators also got a much needed shot in the arm regarding the obvious uselessness of the "250k FDIC insurance" backstop during even a minor banking crisis.

Oh right, I forget, they merely announced that they had liquidated their entire AFS book at a $2 billion realized loss? That makes more sense, the accountants wouldn't have allowed to sell the HTM securities. That doesn't make it better, it makes it worse. Banks don't normally sell securities at a loss in their AFS book, nor do they normally liquidate their entire AFS book to raise cash. These were recklessly alarming moves for SVB to be signaling to the market.

As restaurant's customers actively trust the restaurant to not jeopardize their health.

The banking equivalent of Lastpass getting hacked and not disclosing it would be if a bank was insolvent and instead of rightfully disclosing that it instead just kept it under wraps. That would be accounting fraud and executives would be charged with crimes like they were in the Enron scandal. SVB experienced a sudden liquidity problem, not a solvency problem. Solvency and liquidity are two separate things.

> Let me explain what I mean. After a quick google: What is a Chief risk officer? ... That's all cost-center stuff, none of that has anything to do with the banking line of business.

This is hilarious. Next time, at least try asking ChatGPT instead of Google before becoming an expert on something new and explaining it to others on the Internet.

What you read is the CRO job description for a CRO of any corporation. All large corporations have CROs, and the CRO is responsible for the risks that all corporations have (security, insurance, etc). A bank CRO's job description includes all of that plus the banking risks, such as credit risk, capital markets risk and liquidity risk. A bank run, in particular, is a negative result of liquidity risk.

> They were flying blind. While the Fed raised interest rates, the bank seemingly moved forward without any risk assessments.

Not having a CRO was unacceptable, without question. However, I don't know if having a CRO would have saved them. Lack of an officially appointed CRO does not imply lack of a functioning risk department, so it's not completely the same as "flying blind." Also, the CRO in a bank has a limited role. Decisions ultimately made by the CEO, after consulting the CRO as well as others such as the CFO and the Head of the Treasury department. Given the way the corporate politics and bank politics work, the CRO may have quite limited influence on decisions like how and when to raise new funding, and how much risk appetite to have for things like liquidity risk.

> But that wasn't the issue. The issue was all the "dry powder" that the bank accumulated over the past year.

Not really. The CEO really did inadvertently trigger an avoidable bank run. It wasn't simply the email, but also the decision to sell the HTM securities at a loss and raise equity publicly. The "dry powder" that had accumulated over the past year could have been handled in many different ways, they didn't have to buy 10 year Treasuries at a time when the risk was clearly that rates could rise due to persistent inflation and as the VC investment climate was cooling. The lowest risk option would have been to take the customer cash and deploy it in the secured overnight repo market while waiting a little bit to see what happens with inflation, the VC market, commercial real estate post-pandemic, etc., and dollar cost averaging any plans to purchase vast quantities of securities over years.

I didn't say you wouldn't get it. Maybe you don't want to get it?

Let's say you own a restaurant and you find a mouse in your kitchen. You could:

1. Call an exterminator overnight to make sure you don't have a larger problem and contain the issue before the shop opens the next morning. Improve your kitchen hygiene standards going forward but don't draw unnecessary attention to your renewed efforts.

2. Call the local news station over to your restaurant to get live action footage of you catching the mouse. Go on camera and give a speech about how you've already scheduled for an exterminator to come in a few days, and the last thing the customers need to do is panic.

Which option is the correct business decision, from the owner's perspective?

I think you are missing some context around this story. Banking can be a confusing topic.

What that employee is referring to, and it is a great employee quote, is the fact that SVB's unexpected announcement that it was selling HTM securities at a loss and publicly raising equity is the singular event that really triggered the whole crisis. The CEO's poorly calibrated communication and lack of action in the midst of a run on his bank had sealed the bank's fate by Thursday afternoon.

The point this employee is making is that instead of this kind of "Boy Scout" transparency about its efforts to shore up its balance sheet (which only served to cause panic), the CEO should have quickly and privately closed a deal to raise capital only announced the deal after it was done. I don't know if doing a deal with a Middle Eastern Sovereign Wealth Fund would have helped avoid an accidental panic. But they could have very easily sold SVB to a larger bank before the CEO's own-goal of causing a run on his bank by announcing forced selling of bonds at a loss and a public capital raise. Once the bank run had begun, it was impossible for a buyer to step in.

I believe that it must have been greed and overconfidence at the core of their problems. They didn't want to hedge their IR exposures, didn't want the expense of raising capital quietly, didn't want the expense of diversifying their funding sources away from volatile depositors, etc.

This is the end of the road for crypto's intersection with the official banking system. After the recent financial disasters at FTX, Silicon Valley Bank, Signature Bank, Silvergate Bank, etc, etc, I expect that there is going to a long period where and banks and regulators are no longer keen to experiment with allowing crypto to go more mainstream in the financial system. The tide will turn the other way, and for good reason. It's great that you're all having fun with dog coins or whatever but the financial system is an essential utility to the very survival and stability of human civilization itself, like the electrical grid, or GPS, or plumbing, and I think people will get the picture now about what "innovating" with allowing crazy private currencies to intersect with the official banking system leads to.

> You can sell USDC for dollars at other exchanges, no need to go through BTC/ETC/whatever. For example Gemini has a USD/USDC pair. It won't be pegged to a dollar, like if you redeem through circle but getting $.99+ on the dollar is probably good enough for a lot of people.

Wow, this is scary. It reminds me of the history of monetary economics in the US during the 19th century, a period known for "wild cat" banks and a system where any bank could print their own private currency. In that system, currency was discounted the further away it was physically from the bank which issued it. The system was divided between "city banks" and "country banks." The more remote the location, the less up-to-date information was available about the health of distant banks, and so the more distant currencies were discounted more heavily.

The modern crypto wild west version of this is going to end in a result of going from "getting $0.99+ on the dollar is probably good enough for a lot of people" can turn into "getting 0.01+ on the dollar is as good as it gets" within minutes, if and when there is a run on crypto stablecoins.