"My Mom And Your Mom" Caused The SVB Fiasco -- March 10, 2023

WOW, WOW, WOW: I wrote this yesterday and today it's on CNBC and it's the reason SVB is in trouble. Savers like "my mom and your mom" are / were withdrawing their money from their banks -- "a run on their banks" -- to buy CDs. Wow. What a great blog. LOL. Link here.

A reminder, my favorite chart:

I remember the "push back" I got when I first posted this graphic, many, many months ago. LOL. Paying attention to details.

From yesterday:

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Mother Goose

Advice for today:

Jack Sprat could eat no fat. 

His wife could eat no lean. 

And so between them both, you see, 

They licked the platter clean.

A "talking head" on CNBC repeated the meme: with interest rates this high, bonds are competing with stocks.

My mother knew nothing about investing and kept all her money in cash, money market accounts, and occasionally CDs. She was thrilled with 14% interest rates in the 1980s (?). 

My father, whether he knew anything about investing or not, I don't know. He always said it was always better to be "lucky" rather than "smart."  He did incredibly well in the market despite no formal training and no informal education with regard to investing. I don't think he ever read a book on invested, and ever read The WSJ. About all he did was watch the CNBC crawler ten minutes every day while checking the day-old Bismarck Tribune "money section." 

But he did most of his investing during a multi-decade bull market. He never invested in Treasuries or bonds; he only invested in stocks.

Both mom and dad ended up financially quite well off, probably better than most.

So, for mom, bonds did not compete with stocks. Bonds competed with cash under her mattress.

For dad, stock did not compete with bonds. AAPL competed with SLB for his dollars. 

And it continues in the next generation. For my wife, the money market accounts compete with cash in her savings account; and, for me AAPL competes with DVN for my dollars. 

Disclaimer: this is not an investment site.  Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Again, all my posts are done quickly. There will be typographical and content errors in all my posts. If any of my posts are important to you, go to the source.