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  • Why Silicon Valley Bank COLLAPSED – Headed for BANKRUPTCY!



James 0:34
What’s going on guys? Yeah, thank you guys for joining us for this live special edition of the after hours podcast. This is our first time using this kind of setup and doing anything live. So if you could drop a comment, if you can hear us if you can see us if everything looks alright.

Harry 0:51
Can everyone see us?

James 0:54
Are we moving? Are we are we good?

Harry 0:56
Are we good just right in the YouTube chat if you can see us!

Harry 1:05
awesome. So this, this podcast we were going to do with Bao and Bao is going to show up, but he’s gonna be about like 10 minutes later, so so we can just get everyone in here, you know, talk about some stuff or kind of do whatever make it interactive. You know, a little bit late, that’s alright.

James 1:28
So basically, this episode, we talked about doing kind of a private one originally. And we thought that it was a better idea to kind of get everyone involved in the community in on all social media platforms, just so we could all be better prepared for the week ahead. I think obviously, everyone knows the main topic is going to be the collapse of Silicon Valley Bank. And the cascading effect that that’s gonna have on the overall economy and everything like that. So I think we just got news, Harry, what was the last another bank just collapse or just was closed by regulators? Correct? Yeah.

What Does This Mean for the Depositors?

Harry 2:01
Signature Bank was just closed by regulators. I didn’t really hear too too much about that yet. Reason why.

James 2:08
Yeah, we got so Signature Bank has been closed by regulators. And then as well, the FDIC, they’re going to back deposits, the depositors of Silicon Valley Bank, they’re basically saying that everyone come Monday will have access to their funds. Now, what that means for the actual bank, and for the people, stockholders, all of that, they have said that they are not going to back it, they are basically going to let it collapse, which is crazy. So now, we’re at a point where they’re looking for a sale, right? They basically are gonna need someone to purchase the bank to keep it going keep it afloat. And it’s kind of seeming like if they don’t get a buyer, by the end of this weekend, things are really gonna break things can get really, really sketchy.

Billionaire’s Losses and Uncertainty

Harry 2:56
Yeah, no, I completely agree. And I think I think really, the main cascade is like, a lot of people are looking at this and saying, like, oh, like, how does this affect me? How does this affect the economy? A lot of people are not getting their payrolls, who worked for a lot of these tech startups that were actually banked by Silicon Valley. So that’s a big problem for you know, people who are just living paycheck to paycheck and people who are working for these firms running their payroll through Silicon Valley getting paid through Silicon Valley, that is the biggest ripple effect. So yeah, it’s definitely definitely something to be worried about. I would say,

James 3:36
I see you saying that you launch it by it. That was like the big rumor. Right? Because he tweeted out, I forget who we responded to, but he said he’s been thinking about it.

Harry 3:44
Yeah. Yeah. And to me, I would, you know, I, I don’t think Elon is gonna buy that he’s not enough of enough of a stretch with Twitter, I think. But, you know, for the most part, I just think the overall events in the overall stuff like that, it’s crazy. Yeah, some people are saying let them fail. Other people are saying, you know, keep them coming. Yeah, I don’t know. But, you know, as David said, But, ya know, it’s definitely wild.

James 4:18
I’m excited to see because Bao is someone who has been in this industry for a long time going over 20, almost probably 30 years of trading stocks and equities. And he’s just been around the overall markets. And he has a lot of insights. And he was there in 2008, when we had the great financial crisis. So he really wanted to come on today, which he just said he will be here shortly and kind of give his his insight into how everything happened then, and kind of what he sees similarities now. And he has a really good way of explaining how these things go. And so I’m excited for him to get on here as well.

Harry 4:49
Yeah. And if we’re talking about just the story of Silicon Valley, you know, how everything happened, and how they how we even got in this spot, basically silicon Valley Bank invests in a lot of tech startups, you know, and obviously, through the pandemic Tech Tech went absolutely crazy. The bank made a shit ton of money. And what happened is that the bank ended up investing in a lot of like, Bond mortgage, mortgage backed securities. And as interest rates went up, the value of those bonds went down. And then obviously, there was rumors about the bank not having enough liquidity, liquidity issues, people started taking their money out, you know, power of social media is crazy, people started to get scared, they started to do kind of a run on the bank. I guess the bank took like a big loss kind of before that, the CEO started selling off some stock, it was good enough for a bank run on the bank. And then after that just collapsed. So you know, that’s pretty much the Silicon Valley story where we’re at right now. Now, also, where we’re at is we’ve also seen Signature Bank just randomly closed by regulators. We don’t know too much about that. So yeah. And also on the podcast coming up later, if you’re just joining us, Bao is going to be joining us to talk about his experiences. It’s good to hear someone who was actively trading in the Oh, eight crisis, you know, someone who was, you know, spending their day trading stocks, you know, in the Oh, a crisis, it’s really good to hear from people who are kind of older than me, because like, What grade were you in an 08? James?

James 6:32
I was in eighth grade. Eighth grade. Yeah.

Harry 6:35
You’re a little bit older than me. So Are you’re a little bit older than me. So, you know, I was?

James 6:43
Yeah, no, I think I think one thing too, that’s really interesting is for everyone here, who’s been listening to the podcasts, these past couple of weeks and listening to Harry and I, and Alex, when he would come on, you know, we’ve been talking about the effects of the Fed, increasing rates, and, you know, just pushing interest rates higher and higher, and the effect on the overall economy that that would kind of bring on. And I think now, you know, we’ve said for a long time that we needed a news segment, something catastrophic to happen that might trigger either a stock market crash, it would, you know, trigger more forward and backward direction in the s&p. And I think we might have gotten it, you know, I mean, the reason all this happened was because the Fed just increased interest rates at a really rapid rate. And this company, this bank, did not have funds, actually, to back what they had in money due out. And I think now it’s kind of coming on to show into, you know, it’s coming out now, how many major banks somehow sneaked by regulators? I’m surprised. I don’t really understand how regulators let this actually go by and actually sneak on for so, so long at this point. I mean, we’re now I mean, they’re a major bank, they’re a top 20 Bank. And it’s kind of scary to think that you know, what’s going to happen in the next couple of months, you know, our people, our customers going to feel that they need to bank at a top four bank like JP Morgan, because as much as people don’t want to throw around the term, you know, too big to fail, you know, JP Morgan, Bank of America, you know, Wells Fargo, they are too big to fail, then that is a bank that would unfortunately, that would have to be stepped in, but you know, the FDIC fee stepped in and saved if anything were to happen. So, you know what that’s going to mean, in the short term, you know, are people going to be pulling money out of smaller banks? You know, are people going to be, you know, we always say the term bank run, you know, but what does that really mean? Are people going to be spooked by all this? You know, and I think that I think Yellen and Powell, and I think they’re doing what they can right now to kind of ensure safety and some security and people, they’re telling them that their money is going to be there tomorrow. But I don’t know. I mean, I don’t know if we can actually trust that. And I don’t know what that’s gonna mean, I think a lot of people are still going to run to take their money out of the bank, because it’s scary. It’s scary right now, knowing if you’re going to be able to make payroll, you know, if you’re a startup, and you’re the CEO of a startup, or you’re a venture capitalist, you know, you might not be able to make payroll this week, right? It’s, it’s a little horrifying.

Harry 9:08
Yeah, no, I completely agree. And also, I’m not sure if anyone saw this over the weekend, but there are reports that, you know, love them or hate them. But Harry and Megan lost a ton of money. They were fully invested in this bank. There were some reports that Oprah lost close to $550 million dollars, which is crazy. So yeah, there’s definitely a lot of, you know, uncertainty. And, you know, for some people, you know, it’s crazy.

James 9:42
Yeah, I mean, I think it’s at a time right now, where it definitely is scary. Again, they’re saying depositors are going to be backed, but the reality is, I mean, these people were carrying a majority of their wealth and banks, you know, as an individual, you don’t you don’t have the due diligence and the ability to even do that level of due diligence on bank to know, hey, what are the risk models? You know, what is the risk parameters, you know, when you put your money into a bank that is FDIC insured, you’re just assuming that the bank is doing everything they can to protect their risk and to protect the downside, and just a wake up and one that I mean, it happened over the period of three days, you know, and I think I think it’s really scary. And I think that we’re going to find out, you know, just how liquid a lot of these banks are. You know, I think that we’re very blessed right now that the governmental has to deal with two banks collapsing, rather than if they let this go into the week, you know, who knows? And, you know, the smaller banks don’t have the liquidity at these, these banks supposedly did. And, and he’s right, you know, I see comments like, the leverage is a mouthful. It’s true, you know, these guys have over leveraged themselves, they’ve put a lot of risk on the startups and the capital allocators that would get bring money back into the bank. And, you know, it’s, it’s not looking like these guys are as honest and upfront as we could have thought we would have liked to hope they were, as you know, suppose it, you know, protectors of our funds?

Harry 11:02
Yeah, for sure. And, you know, I’d like to do something kind of like interactive, you know, because we are kind of sitting here we are waiting for Bao to really kind of get this started and talk about some stories and stuff like that. And, you know, in the comments, maybe right, like, do you think that the US government is going to bail this bank out? Or do you think they’re gonna let them dry? You know, you know, I think, you know, I don’t really know what’s gonna happen, there’s reports in the morning, that the government is not going to bail them out. Now, later, there’s reports that the government could be potentially bailing them out. Everyone’s saying a different story right now. So maybe in the comments, do you think the government is going to bail these guys out? Or do you think they’re going to let them dry? You know, be interested in see what people think, you know?

James 11:49
What do you think?

Harry 11:52
Personally, I think that they’re going to protect the everyday citizens, and the rich people are just going to be left to fend for themselves. You know, through like, with the government that we have, right now, the people who are elected in office right now, it seems to be that their kind of agenda is, you know, trying to make it seem like they’re not helping rich people at all, you see, Biden come out with 40%, capital gains tax that he wants to do. He’s taught me all the time about oil companies that oil companies are having too large of profits all the time. And his State of the Union speech was really geared towards attacking these kind of people who are wealthy and, and like large corporation. So to me, I think that this is the perfect time, if you want to keep on that agenda, to say, hey, look, we’re not bailing them out. This time. We’re not We’re not touching them, you know, we’re not going to bail them out, we’re going to make sure that the depositors are going to be insured, we’re going to help those people out. But everyone else, they can fend for themselves. And I think that that could be a very real scenario, with this kind of agenda, right?

James 13:05
Yeah. Well, I think it’s really known right now that they, you know, they’ve already said that they’re going to lease back to depositors. But the reality is, they need another bank to come and purchase Silicon Valley. And what I worry about is, you know, back during the financial crisis, JP Morgan, was helping out, it was trying to help Lehman, they’re trying to help out other banks, and they caught an insane amount of backlash and frustration from the government. And I think that they’re going to struggle materializing a purchase sooner rather than later. And I think that’s the cascading effect. As of right now, you know, we’re at a point where tomorrow is going to mark a really, really interesting point going forward, meaning, we’re going to really find out how many banks this actually kind of, like, cascades down into. And, you know, I think they’re working really hard because they know, they’re serious contagion risk. I think that, you know, we’re at a point where it’s really scary to think like, how deep do these guys go, you know, a lot of cryptocurrencies and a lot of crypto companies bank with these guys. And it just, it just seems like now all of a sudden, they’re without funds, you know, and you know, now it’s kind of waking people up to to the startups in these, you know, hopefully founders and everybody like that are going to be smart enough to kind of take their money and hopefully put it into multiple different avenues and different banks, so that way they can safely keep their companies afloat when something lf his happens.

Cryptocurrency Cryptocurrency Crash

Harry 14:22
Yeah you also saw that cryptocurrency USDC I believe it was that de pegged over the weekend. Yep. That that, you know, that’s pretty crazy. And there was also another guy on Twitter. You know, Cameron Foose, I believe that he was talking about how he had he lost 2,000,001 of these deep bagging schemes. And that’s crazy, you know, like, it’s absolutely nuts when you have these coins called like, stable coins or whatever they are, and then all of a sudden they just D peg and you know, what are you left with? Right, which is crazy. So there’s a bunch of things just going down. I believe like, Roblox wasn’t affected. There’s a website called Etsy or whatever, where you can like, get people to do things for you like maybe you want like a custom shirt, or maybe you want like a custom painting or something. Yeah, yeah, there are deposits were withheld over the, you know, over the over the weekend, so a lot of people didn’t get paid. And there’s a lot of people who are struggling to get paid right now. And that is the impact on the economy itself, where it’s not just like a venture capital fund went down and a bunch of rich people went down. You know, that’s what’s crazy. I heard on Twitter, that Oprah is down $550 million. That was a rumor about Oprah was $550 million. Roku, the TV company had millions in their Roblox millions in there as well. So there’s some crazy rumors circulating Harry and Megan apparently want to keep it confidential. Apparently, Harry and Megan now are suing their financial advisor who advise them to go to Silicon Valley in the first place. So there’s so much drama around this.

James 16:13
Yeah, I think though, this, this is one of the where things people have to be really careful, though, right? Because the idea of a bank run is solely people getting scared and pulling money out of their own bank, right, and people pulling money out of a bank that they think there’s going to be no funds on their funds there the next day. So by seeing all these crazy headlines and stuff like that, when you know, the federal government, they were going to step in, they you know, it took them a few days to figure it out. But have now said though, back depositors, so like all these crazy rumors, and crazy things swirling, it’s almost like it’s like fear bait, right? Like it’s scaring people into thinking that they’re not gonna have their money tomorrow. So I think that’s where a lot of people have to be careful. And I think, though, that this wakes us up to the actual risk of pushing rates as high as we are, you know, Powell has said he’s not going to stop until he is at his mandate, you know, that two to 3% inflation model that the federal government has. And I think, I think this is just showing how bad things can really get on a large scale. I mean, we took down a bank by increasing rates at a rapid rate, what is this going to do the average person, right, you know, and that’s kind of like something that’s going to be interesting to hear from about is just like, what the world what happened in the world, when this happened the last time, you know, when the world really went down, and banks were failing. I mean, it’s not every day that you see a bank fail, you don’t usually see people being scared that they’re not gonna be able to get their money, right. I mean, most most people out there, you know, average Americans don’t have more than $250,000 in their bank account, so that FDIC insured is plenty. But when the when actually the wealthy people and people with over a million dollars in their bank or over 250,000 start getting spooked that they’re going to be able to pull money out tomorrow. I mean, what’s going to happen? What is going to happen in the financial system? Are people going to start losing you know, confidence in our banking system overall in the US dollar are people going to flood the cryptocurrencies for protection? Which sounds crazy but who knows people have always said that you know, Cryptos were unregulated and that was the scary thing about them was but in the reality is there’s regulators and banks, and you know, and so it’s gonna be interesting to hear and you know, I’m really excited to get Bao on that was dropping off his son he will be.

Harry 18:19
Here logged on yep!

James 18:23
So yeah, just like that the devil appears!

Harry 18:28
We see you!

James 18:30
That was always looking in the wrong direction. I’ve never really understood why but oh, we can hear we can see you. It’s kind of like that grandfather group. Now. He’s got to give him a minute.

James 18:50
Or you might have to turn on his mic. Yeah, there you go. Yeah. What’s about maybe needs a hearing aid.

Harry 19:02
Can you hear me? Yeah, yeah, but I think you’re at the wrong mic or something like that. You’re just very faint.

James 19:10
This is like trying to help my mom trying to figure out an iPhone. That’s kind of what I feel like right now.

Harry 19:18
Can you hear me? Yep. Can you hear us?

James 19:24
Looking the right way.

James 19:32
As you guys can see, this is obviously our first time doing this!

James 19:41
Maybe if we all start yelling at him.

Harry 19:43
He’ll see the funniest comment I just saw his bow is sending orders for low hanging fruit.

James 19:48
Yeah, we can hear Can you hear me?

Bao 19:51
I can finally hear you guys now. Good. To see my ugly face. I can.

Harry 19:56
Oh bao. Do you have air pods? Yes. Are that go away? No, it’s this we can’t really hear you. Well, really? Yeah!

Bao 20:06
You cannot hear me well can we turn off my you cannot hear me. Well, can you hear me? No. is only here is everybody else? No. I mean, obviously I can hear you. Alright, let me put it closer. There you go. Okay, can you hear me now? Yeah, is it better? Yeah?

Harry 20:26
Maybe it’s just me though can’t hear you well!

James 20:29
What does he sound like to you guys sounds good got better?

Bao 20:36
Can you hear me okay I’m gonna talk right now can you guys hear me or not? I can you gotta get turnout guys.

James 20:44
Yeah no very good they’re saying it sounds a little faint on their end.

Harry 20:47
Little rattle a little bit faint.

Bao 20:53
Microphones are jacked up I guess.

Harry 20:54
I don’t think it’s hooked oh yeah maybe is it hooked up?

James 21:01
We don’t have yeah I think we can we can?

Harry 21:10
Maybe if you if you click on the See your face the three of us and if you click on the three dots like on your face,

Bao 21:22

Harry 21:24
And then click Edit Mike Settings at the bottom.

Bao 21:28
It says stop okay the way it uses your settings and see the audio. Where’s the video? Okay, microphone. Microphone. Oh, I know why. My bad guys. So first time using the stream thing and so it’s got it on a different setting. Okay. Yeah. Now, did you hear me? Yeah.

Harry 21:50
Because I know we could.

Bao 21:51
That’s perfect. Because Because what happened was this defaulted to my camera. Okay, so that would be right. Yeah, now I’m too loud. Now you’re telling me to shut up this is this is great, guys. I guess I’m a little dark but let me turn on bright lights!

Harry 22:14
Right. It’s not good at all.

James 22:18
He’s about to go get his uh, his big special camera from the back you know the light.

Bao 22:25
Don’t do selfies and shit.

James 22:28
They saw pictures on the internet.

Bao 22:32
That’s cameras. I got it. I got it. I guess you guys won’t see my face. But we do. We love seeing it. Oh, but it’s like you’re way out there the defects of anybody guys.

James 22:47
We could all be deep fakes. I wish someone wouldn’t.

Bao 22:50
Want to be a deep fake of us though.

James 22:52
They can make a better looking deep fake than me.

Bao 22:58
What do you think? Yeah. I think it’s coming from the wrong side. Well, I guess if it’s really turn up, turn up. Oh, give me one second.

James 23:07
As you guys can see. His own lighting and videography.

Bao 23:12
He knows we are day traders. We are not these online, guys. So I don’t have a studio here with my face on it. You should be scared if some guy has like a studio. And he’s like pretending to degenerate.

James 23:29
That’s how you know it’s fake. First time ever meeting bao everyone’s always shocked. He’s just wearing a t shirt and short sleeves. Yes.

Bao 23:38
Dude so how many of you are on?

Harry 23:42
We have 250 right now.

Bao 23:45
Whoa. So you think if we wait, we get more?

James 23:48
More people. We have 250 people watching you move a lamp back and forth !

Bao 23:57
We really need to try and we were trying to get this podcasts out as quickly as we can is because I know trainings on Monday I’ll talk about that my trading plans for the stock as well. So how about just groups like right guys? I really can’t individual. Alright, guys, so welcome to the podcast. I know. We’re done. We’ll see you later right now. But um so it’s been a long time guys since I’ve been on this podcast. But I call this an emergency meeting. Pretty much like yesterday, guys, as I please, please. Everybody’s talking about and instead of me having to answer 1000 people one at a time, including my friends back home. I decided to do say hey, let’s get this podcast out. And we need to get it out before the market opens before it because who knows a lot of our viewers or listeners have accounts at Silicon Valley Bank or some other bank. The last thing we need is for you guys to worry because you’re afraid your money is not safe. So where have we started guys? So what do you guys want? Thanks. So, I’m assuming you’ve heard about Silicon Valley Bank, and that’s why you’re here. So we don’t need again, too. So the reason why I felt this guy’s Okay, so I’ve done a little research on it. Banks fell because of a couple reasons. Scams. In this case. It’s not a scam is, in my opinion is my Pamela lawyer, they’ll sue me. I think they fucked up their fiduciary duties, their risk manager didn’t understand what the hell’s going on, they had so much deposits where they didn’t know what to do with the money. So they got really greedy. So I’ll tell you, why are we? So it’s funny, because let me bring up up. Can James you pull up? Remember, we posted? Who the chief administrative officer.

James 25:48
Tweeted that earlier? Correct?

Bao 25:50
Yep. And I’m gonna show you so I’m gonna, I’m gonna start guys, I’m gonna tell you exactly what happened, why the bank failed and how you will protect your money.

James 25:59
Someone can find that post and post it.

Bao 26:03
To the group chat. It’s on Twitter. It’s basically so the guys did the banking industry to be to be honest, it’s very small, just like trading. I’m a trader, you guys all know me. Areas of trader. James, a trader is a small company. People know each other right, guys. And so the same thing happens in the banking industry. And so a lot of executives get recycled. Yeah, so this is a good segue to this, because they did not learn anything from 2008. Guys. And so.

James 26:40
Yes, I sent it.

Harry 26:44
What happened? Here? I’ll bring it over.

Bao 26:48
Yeah, I don’t know how to use this stuff. So I am like my parents. Like, how do you do this stuff? So thank you guys for handling all this stuff.

Harry 26:56
I’ll post it in the chat.

Bao 26:59
Oh, it’s just just funny because like, I posted this, and not many people know about this. And so it’s like, it’s like, what the hell? How does this guy get a job? Right?

Harry 27:07
Yeah. That was the Bear Stearns and CEO of Lehman.

Bao 27:14
Can we show you? Oh, Lehman, Lehman CEO. Yeah, he’s even worse. This is Lehman is the bid was the biggest bank failure.

Harry 27:25
You posted it in the Twitter comments?

Bao 27:28
Perfect. Oh, you can’t you can’t show it on the screen?

James 27:31
I don’t think so. No.

Bao 27:33
Yeah. So anyways, so it’s ironic that the one of the C level executives at Silicon Valley was the old CFO for Lehman Brothers, guys. Yeah, how crazy is that? Right? So they’re recycling. So that’s all you would, you would expect he would learn something. So what happened was this guy, so interest rates were at 0% are really cheap for a long time, right. And so during that time, the Fed did what they did to do to boost the economy. I’m not gonna get into politics, but in my opinion, it was for elections, all that which is obviously true. And so I’m not picking any sides. But this is how the game works. During the times of voting, you want the best economy so that voters vote for you. So that’s exactly what happened. So they the Feds pumped the markets up they want to, so they’re printing money left and right to do whatever programs they want to do, right. So remember, interest rates was zero, I think was didn’t even go negative before. Yeah, Japan was negative, you know what negative means? It means that a bank is paying the Fed is paying you money to lend out money at the print. It is to spike up the economy. Okay. 0% means that, hey, I’m a, I’m a big Well, I have a billion dollars, and whoever wants to borrow money from me, I’ll give you a 0% interest. Why the hell would anybody do that? Right? It just does not make sense it what happens is that it was there were very desperate to pump up the stock market, right? Because Because of COVID. And so that’s why it killed everybody. So during the time to covid, you’d expect logical sense of the stock market would take their COVID, right. Like COVID, they shut down the economy. How is the stock market going up, is because the Feds were buying the securities 0% They’re buying the underlying securities, the bonds that push up apple, and they haven’t bought a fucking Apple phone in two years, guys, I’m the guy that buys five Apple phones with my family every time it gets released. And in this time, the economy or whatever, but it doesn’t matter.

Silicon Valley Bank and Silicon Valley Startups

Bao 29:37
So the point is the Feds were giving out free money. And so what happens is this, so it’ll just start. So all the startups so if Silicon Valley Bank is a big bank, one of the biggest banks over here, it’s actually yeah, I think it’s I think it’s like one of the biggest banks in the world dude. So funny. Yep. And so, Silicon Valley Bank serves Silicon Valley. And what Silicon Valley is, is startups where technology tech startups, so a lot of tech stars. Go there, because that’s the famous they do funding for that. And so what happens is you have all these deposits coming in, so that there’s 0% interest rates. So people were just given the bank’s money. Do you think that’s why the VC, venture capitalists were starting all these startups? And was it money from? They have hella money, dude, free money? So they just give me a loan? Yeah, people. So what happens is, so now they have all that money in the bank. And so the guy at the bank, the chief investment officer of the bank, whoa, we have freaking excess a billions of dollars. We know what the normal bank does. They give out loans, your traditional bank gives out loans, they take your money, they hold it and to give out loans. So it’s, it’s basically the only time that they will go under is all the loans default. Right, guys? That’s what happened during the Fannie Mae days and all that we’ll talk about that too. And that’s going to talk about how you day trade, right? But but so the traditional model of a bank is they give out loans and take all your money and start putting into Bitcoin. And that’s exactly what Bitcoin blew up. Okay. So we’ll get to that today. So the traditional banking model is very conservative, because the biggest was the conservative there will be your money is not there money is your money. When you want the money back, you should get the money back.

James 31:17
There are regulators that are supposed to be back on this and honestly, monitoring everything that’s going on.

Bao 31:22
The problem is this. The problem is the fact that everything works until it doesn’t, right. It never fails until it fails. And so what happened was you have all this excess money, and they decided to buy bonds with it. They they stopped giving out loans. Why would you give a loan, when you make more money in bonds, they’re buying at 1.5%, where they held the bonds where we’re at, right? And so the problem is this. They’re making money. Cool, cool, because the interest rate was zero. And they didn’t, they bet they did not anticipate that the feds would raise the interest rates so quickly, and so much, and so sharply. So when the interest rate goes up, the bond values were down. So now they’re sitting for make it up, like 1.5% interest on the yield on the bond. Yeah, something like that. And then now it’s 5%. They’re underwater dude. So what they needed to do was they they got rid of their bonds, I think that I’d read it, they lost $2 billion. Okay, because the when the when the interest rates go up, what happens this, and then these companies start to need money. And so they start to take money out. And so they saw an influx of people, because these companies laying people off, didn’t have money for payroll and all that, and they started coming to the banks to take more money out. So one of the basically, holy crap, it’s okay, one company coming to take our $50 million is cool, we have billions. But now you multiply it by 200 people coming in at the same time. So that’s why they call it a run for the bank run for bank means that it’s a domino effect, where everybody gets scared to start running to the bank to take the money out. And so if a normal society comes, I have a lot of money in the bank, hopefully, you guys have some money in the bank. We’re all not all going to take all our money out at the same time. And that is what they’re, they’re banking on the fact that they’re keeping your money. But it’s like, it’s like life insurance.

The Financial Meltdown of 2008

Bao 33:15
No, I was gonna die at the same time. But if everybody dies the same time they’re gonna go bankrupt. How can they pay money back? Right? Yeah. Same thing with health insurance. I knock on wood. We don’t have a serious health issue. But imagine if COVID happened like nobody else. Yeah, that’s what happened, right? And so if everybody goes to the doctor and has a disease at the same time, they’re all gonna go bankrupt. But the fact that they’re playing the 100 year long game, that’s how insurance works. They’re betting that only 2% of the population sees this cancer treatment, and everyone else just doesn’t even go to get their teeth cleaned. Right. And that’s how insurance works. And so the relevant bank what happened was interesting went way up so much inflation all this, the startup companies started losing money, and the bank did not have cash reserves. They wasted their money instead of giving out traditional loans or playing it safe they bought these stupid ass bonds and now they’re underwater they are day trading your money for your the back end, I found that you lost all my money because you traded bonds. Oh, hell what the hell you know about trading? Should shouldn’t you be putting into a t build as safe was too boring. Why would you put a boring T bill with the bother making 5% So that’s why I’ve been so they basically gambled guys. They invested your money, regardless, whatever they said. The fiduciary issues was not good. But this is one of the problems guys. The problem is it doesn’t matter who’s right or wrong. The end of the day, who suffers is the people that deposit the money in the bank. Yep. And the problem is this guy’s nothing happened in 2008. So I was there during 2008. That’s the it’s called the financial meltdown, which is the mortgage and all that crap they were selling. They were making fake income to get loans to buy to get houses and all that shit, right? So it was a bubble, the bubble pops. And now they’re holding a bunch of worthless defaulted loans, trillions of dollars of loans. Now defaulted. Imagine I buy a house for a million dollars? The house is worth 700,000. Because of appreciation, all that bullshit, that is basically the.com bubble, right? So now, I owe a million dollars, but the house is only worth seven. What are you gonna do, guys? Bye, bye, I’m gonna get back credit. See? Yeah. And that’s what people do. And that’s what the mortgage meltdown happened. All these people default on their fucking loans. So what happens is same thing with the columella bank, the loss of money, and then when when I came back to get my money back, they go, Oh, wait, we will give you the money, we just kind of chill out, you know. And so they tried to, they tried to do a offering to try to raise two and a half million billion dollars or something, right. And when they did that, they showed the cards, the people with the full thickness of race. Whenever someone does an offering, and it’s thought, what happens? They need to raise capital, right? They need to raise money. And you’re like, what happened all my money? Why do you? Why do you need money? How can you lose your money that gave you you are a bank, you are not a trading fund, you are not an investment company, you are a bank. So a lot of the people on the street have no idea what a bank does. And in Asia this way, they don’t trust the banks. But that’s a different story. So now what happened is one guy who starts to get the money out, and then they saw them do the offering. Everyone’s like, what’s happening? So everyone’s running to the bank. And it’s not the little mom and pops guys that they give a fuck about to be honest, guys. Most of the money 95% of the money is over FDIC. That means only 5%. Or the normal guys 95% of money that’s in there is it’s Wall Street money. And so Biden loves the shit was AOC. Right? We’re on capitalism and all that. But anyways, that’s, that’s beside the point. And so what happens is now that startups, they need payroll, they go to the bank, and the bank will have their money. So, so let’s call the bank run for the bank. And so regular stepped in really fast. So they showed the card, they could not raise two and a half billion dollars, guys. That’s why they needed to do the key because they lost $2 billion in the bonds or whatever the hell you lost. Yeah, and so now, so it’s all painted scenario, why the big fail, the bank fell. Because they’re never gonna say this. But the insiders were greedy, you got my money? And what the fuck you do with it, man, you’re not supposed to touch my money. That’s because the rules the regulations were designed. So that that kind of is called fractional banking. Fractional banking is they have a limit that because they don’t anticipate everybody running to the bank to get the money, same time. So they have their models, whatever it is, but pressure banking doesn’t work when you’re fucking investing with clients money. And they train that shit. I call it D chain, because anything that’s risky. Why would I mean, dude, you know, race is not gonna be zero forever. But you know, it’s Wait, you wake up and you’re like, oh, shit, shit happens, right? And so that’s, that’s what happened. They tried, they didn’t have enough money because they lost money, investing your money, whatever the hell it is, and bonds. And then now the people, the companies are going broke, they want to get the money out to pay payroll, and then one guy sees that you try to offer you’re trying to get a loan for $2 billion. That’s pretty much what financing is. Right? That’s what offering is where you get a loan. But no one’s gonna touch that shit. And so one guy calls with a guy and then next you know, I remember these are big startups, guys, big startup, not even startups. I posted a list you know, there’s squared a huge like, do this. Yeah, you see, all these people work up to 8 million. That’s nothing. These companies have $250 million in there, right? They square has 4 million, whatever the hell they lost, right? And so imagine they come into our money. So I’ll give you an example guy, so I went to the bank. This was one year ago, and I was there for over two hours trying to get out $6,000 You remember that guy? That guy’s six or $8,000? Yeah, yeah, I remember that. I was I was so mad. I like so that what they did was a sir Do you realize that’s a lot of money. You can people will rob you What are you using this money for? I need my money doing just this only $6,000 And so they’re trying to convince me not to take the money out. Because you know why they don’t have the money? Hey, most of the transactions in the world now are all digital.

No One Cares About Paper Money

Bao 40:10
No one cares paper money. That’s how they control you, which is okay to conspiracy theories, they want to control bullshit. You don’t want to deal with $200 $100 bills is because it’s like, dude, how you fucking buy a house with $100 bill? The only people nowadays, to be honest, the only people that nowadays that need 1000s of dollars are gamblers, drug dealers and people that are money laundering, right? Yep. A legit individual and not gonna carry on a wad unless you’re a rapper trying to shove off and rappers I don’t wanna get into that, but they’re not legit either. And so anybody so the government way of handling tax cheats, money laundering, drug criminal activity is to not let you have a physical form of currency!

Bao 40:59
Because they cannot track you. Let me tell you some governments are based around money without money government fails. Defense right we were shipping tons of billions of dollars to Ukraine Money talks about Yeah, and so they would never so people are talking about Bitcoin be the next bullshit the bullshit the government would never let that happen. And so right now you see what’s fucking funny. Crypto is dead. And the guys that say oh these things are dead. I knew that all my money in Bitcoin I want to get bitcoin out what do you do? I need to transfer that shit to US dollars and now the pay was that USDC is under it’s like what is that that guys look it up. Crypto might go to 00 its unpegged right?

Harry 41:44
USDC just unpacked that stable coin that the bank was involved in or something like that?

Bao 41:52
So is crazy right guys? So basically the government controls the money supply because the fact that that’s all the government does man money controls do everything. And so it’s not a bad thing is digital that control by the government is not a bad thing. I love the fact that control because you know why am I doing anything illegal? I’m not doing anything illegal. Why the fuck do I care about Bitcoin? I’m out here smuggling fucking drug money or cartel money. That’s how they that’s how they fund criminal activity guys through fucking anonymous crypto. How do you think people buck and pay for nuclear bombs in Russia? I do a wire transfer through city bag that I carry on pile and that’s why the US dollar only caps out $100 Guys is very difficult to think about 100 has been around for forever inflation now $100 Barely by me. I would have done something that cost me 10 or 20 bucks but in Europe was the biggest denomination in Euro 500?

James 42:59
It’s 500 Right?

Harry 43:01
Yeah 1000 all about.

Bao 43:04
That’s pretty huge guys. That’s pretty huge. So what they do is they money laundered through crypto and then assets like diamonds and not even diamond diamonds arbitrary like gold the gold is heavy. But they do a you know they do in cars, collectibles, like art, and NFTS and all that. But so so so I’m staying in a case where do not get into this conspiracy theory thing is the banks are bad banks. Not bad guys.

The Banks Are Good if You Have Money

Bao 43:29
The banks are good. If you have lost if you look at Celsius, look at FTX they don’t have FDIC you know the essence where your fucked

Harry 43:48
about a like.

Bao 43:52
So the banks are good, because you know what your money said guys? 5% of normal people like us, FDIC used to be $100,000. Now it’s  $250,000. So that means a normal individual, normal working individual don’t have $250,000 in the bank. But if they do, it’s covered up to two to $50,000. I sleep at night, rob my bank, I don’t give a damn, it’s insured by the US government. And oh, you trust the government? I trust a guy that has a nuclear bomb. You’re gonna fucking fight them with a nuclear bomb. So who has the biggest weapons when So? So? So FDIC stepped in and said on Monday that people have their money up to $250,000 us normal people. You know who loses the startups, these greedy motherfuckers and you know why they’re all embedded with the regulator’s I’ll bet with the bank, President CEO. And so what happened to 2008? They didn’t learn that lesson. Okay, so they raised 200. But the problem is this the promise, so I’ll get into. Okay, I’ll stop here. I’ll take questions guys. We’ll stop here right now. Any questions from the panel from the comments?

Harry 44:58
I just thought up What do you think about like a central bank digital currency? Like if they tried to make their own crypto in the states already worry anything about that conspiracy?

James 45:07
No, they already have a pilot program in New York for its own digital currency. I know someone who works for the Federal Reserve of Boston, who they’re working on in here as well. It’s going to it’s going to happen. I mean, I even notice I don’t know if you guys notice in your everyday life, that cash is just becoming slowly and slowly less involved. You know?

Bao 45:29
What the fuck is crypto? It’s a digital currency, right? Yep. We have that fucking Pay Pal. venmo zelle. No, fuck Apple Pay. We have that already, dude.

Harry 45:40
But there’s been rumors going around that like? Yeah, and this is just dropping.

Bao 45:46
The eventually what? This is the good thing. The only thing crypto is it’s the blockchain. It’s currently on blockchain. That’s it. So when you talk about crypto is not crypto they want is blockchain. But the government has blockchains in terms of wire transfer. They just basically they want to write paper trail. And so the government having their own digital currency, crypto blockchain, who gives a fuck? doesn’t change anything that we live in? It makes it makes our life easier. It makes money laundering harder. It makes criminal activity harder. The normal people don’t give up before do you care? You’re doing a drug test already? You got a bank card everywhere you fucking go. Yeah, this is fucking funny. We have a phone. The phone even though it was off, it’s still listen to us. There’s a GPS in here that they can track you on the world and you’re worried about crypto and they’re talking your and most of these guys got $2 in the bank. They got one book and one dodge coin. Okay, so yeah, so it’s basically it’s only the criminals guys or the fucking guys that have no clue what’s going on. That’s worried. I’m not worried. What I love about the government is this. You know, me, Man, I hate these big things. But what I love is the fact that I know I’m money fucking safe. I put my money under a mattress and what is going to rob me I put in jewelry, I’m gonna get robbed when I walk into the store. I’m gonna give it to my local blown shark or my you know, we’re gonna put your money dummy, you’re gonna put it to FTX you to put it to mountain GOX you got to put it into a fucking crypto bank.

James 47:34
I want to buy some meta real estate.

Bao 47:37
So all those companies are not insured. So this is the problem. The problem is the banking system works. It’s just the greedy motherfuckers out there that are or don’t think about these worst case scenarios. So I’ve thought about this guy. So any questions before I move on? Because this happened to me before.

James 47:52
But one of the questions that was asked a few times is how do you think this bank collapse is going to affect the average person?

Bao 47:59
Not just the average person sleep at night no more. If you have more than 250,000 there you will lose it. The average person do not have $250,000 in their fucking checking account. Right? If you have more than 250,000 . I don’t feel sorry for your ass. You’re a greedy motherfucker. Right? Oh, I’m making all this free money. So you know during the crypto days, the crypto banks told everybody to put the money into the crypto bank instead of putting into Citibank right? Because the crypto banks were taking 17% 12% 17% 20% Sometimes even 25% Right?

James 48:37
You could stake it for like 20%

Bao 48:40
Where they get all that money from and the moment that crypto stops going up, interest rates go down. Blew up, these Guys got millions of dollars a Bitcoin gone calling the government help me help me I just got ripped off and and and those are saying guys go fix the government I need to go over to decentralize this shit. I don’t trust the system. And now when when you go off on your own and this decentralized bullshit scams you you call the police defund the police and then someone brings you help please come now please come out. All these criminals are trying to rob my bitcoin. They do my bitcoin. Okay, so, so be careful what you ask for. I don’t believe in that bullshit, decentralized bullshit. Because at the end of the day, they will fuck you up. They will let you die. They let the government laughing at all the crypto bank failures. They’re prosecuting FTX and they’re not. They’re not helping the depositors of help. FTX are they they’re just saying Oh, yeah. You got it decentralized. You got it. You are afraid of big government. You got it. Now, what are you in short? Your whole point was you don’t trust the government. You took your money out of the bank to put it into some scam bank that has no insurance and now you cry the government for regulation. I thought you didn’t want regulation. So what happens a little guy?

Bao 50:27
Nothing. We laugh You dumb asses. I’ve taught the government got their money back on Monday morning. FDIC is working today to make hole every FDIC insured customer, but FDIC only goes up to $250,000. That’s still better than $100,000. What I grew up when I was trading back then it was $100,000. But we’ll talk about that a little bit.

Do You Think This Will Affect Rate Hikes From the Fed?

James 50:57
So that one of the other questions that popped up is Do you think that this is going to affect the rate hikes from Jerome Powell at this point?

Bao 51:06
Remember, you remember last week, Powell said we still got 2 million people left to be unemployed.

James 51:12
Talking to Elizabeth Warren human, they were in the spat, right?

Bao 51:15
Yes. Elizabeth Warren, you understand all the humans, but we need to because we need to stop inflation. The Fed is doing exactly what is intended. They raise rates. The smart people at the bank should understand how that works. But these smart people are what? X Lehman brother motherfuckers and you know why they do that guys? No one went to jail. 2008 No. single person went to jail. billions and trillions. If you walked into a bank stole $20 from the bank, you’re in for 20 years. Yeah, when you rob $100 for the bank, you’re in Jailfor 100 years when the bank robs you of a billion dollars I need more training guys. My bad I was I didn’t know that when they said you say Wells Fargo member at Wells Fargo making a lot of fake accounts and steal money from people no one went to jail what we do is we realize there’s a problem we will train our people better you are the motherfucker that told them to steal people so that you can make reports for your 10 cuter you’re stuck don’t think the system is broken because it’s broken by design because the people that designed it they don’t give a fuck because who’s going to bail everybody out?

Bao 52:36
We are our tax dollars they made so much money pull up when we posted how much the insider sold three hours days before the day.

James 52:49
CEO so I think it was $3.2 million worth of stock.

Bao 52:53
Posted it all dude pull it up do not just the CEO the insiders so let’s pull it post pick it someone posted what I posted NYC did you post it on Twitter Bo younger retweet this so you see all this stuff guys? I mean just put it in the comments MIC See I told them okay let’s go through what was posted here guys so read this I don’t know how so if you want to see it go to my twitter Modern_Rock.

James 53:20
Area actually posted it in the comments you can click on that link right there.

We Are Our Tax Dollars

Bao 53:24
So I posted when I people in MIC was asking me that day should I buy it? Will it go up and I told him I’m gonna read exactly what’s happened this was like half an hour before it halted guys so I want to read I was like SVB is at 40 bucks right now. Okay No it’s about to go bankrupt and can hold the you lose it all and it went for 40 bucks or 34 or something like that and people who do the latter do don’t want you to just go Home Assure them no but not not only that. I repeated I said remember this guys lots have insider information only bad news are coming in my opinion they are selling everything they own look at this chart right now filings came out later that the CEO and the insider soul all this shit right see but you you don’t think they know what will happen bankruptcy? That’s what they call it silly shit. You don’t think a bank of that magnitude? The guys inside knew that they had liquidity issues a month before this happened same thing at Lehman Brothers remember all this movement we saw Yep. They were inside with the fucking SEC was fucking the treasurer trying to get bailouts and all that you don’t think they know each other? Yeah. Oh, I didn’t know that she was gonna happen but I just told all my sock it was just coincidence. Oh, I’m just trying. You don’t think a CEO knew this shit months ago. Go watch what happened to us and it wasn’t move those movies that the documentaries is all about that.

James 54:57
Right? The big shorts a good one.

Bao 54:59
Yeah. They are in there for months trying to figure out should we let it fail is a systemic issue is it going to cause anything else? Do their food just bind but they’re playing with people’s fucking livelihoods? And you know what they mean money. You see the clawback? Usually there’s a clawback right like but when when was that guy? The biggest swindler guy when they caught Bernie Madoff they they made everybody that profited give back the money.

James 55:34
Even like old like grandma and grandpa’s that made money I just watched a documentary on Netflix was fan I mean on I think was on Netflix. It was fantastic. They made it but the CEO of this bank he did this video from one of the most exclusive high end golf resorts in the world in Scotland while he just passed out 3.2 million!

Bao 55:53
He’s wearing a fucking Scotland let me shit okay we’ll talk about but so basically say so the problem has happened to this guy is no one was no one’s held accountable. Everyone says it’s a system failure my bad no one went to prison. So nothing changed. These guys made out like bandits right? They made money billions of dollars whatever the fuck we make right? And then what you really think they give a fuck about you? Because you know why guys? They know that FDIC will say the little guys as long as we say the little guys look guys not gonna say anything. They look guys they’re gonna blame it on the big guys right the big corporate monsters. Yeah. And so So now that you see the monsters are the little guys all their money back because if the SEC to to 50,000 us guys. So as long as you got your money back, you’re not gonna fucking say shed way. Here’s how the system works. I love this system is the people that lost are the rich guys. Ha ha ha I love it. I love it. And so the cycle repeats was no one’s going to go to prison, because the system is designed for greed. Because this never happens. Right guys? This is like a it’s called a Black Swan. But as a trader, we know what’s happened all the time. Yeah. But of this, this happens a lot, guys. I’m pretty damn sure. But it’s so small or they put on the rug. It’s just this one was so big. And it happens so unexpectedly.

Harry 57:18
That well there’s another one that closed. Signature.

Bao 57:23
They do this, a lot of these banks are closed. And I don’t know the reason why they closed but but if me and you ran a bank, and the Feds were giving a 0% loan out all day long. I’ll make less money, but I will live not worried about hurting people. I would have a business for 1000 years. Or you can get rich quick like in our industry right guys? With public comps, like those guys have made millions of dollars in a year go to prison. Yeah, that was the fact that he goes to prison. No one’s gonna do it again. But in the investment banking industry, that’s just investment banking. I make my billion dollar my bad onto the next one. And so, the little guys like us should not worry. This is where you should, where are you? Okay, so I’m gonna stop for the questions. And then I’ll move segue this from banking into trading. This is why we call it this. Okay, so any questions so far? Guys, you guys understand? Banks are good because of insurance. So let me finish let’s think about the bank insures cash, who the hell could a shirt billions of cash. You can’t because someone could steal the money and say, so what happens? A lot of things are not non insurable. So, so the things that if they, they’re buying these bonds, but at least but they’re losing, at least they’re losing they did on their own right, no one stole from them.

Harry 58:57

Bao 58:58
what happened is they lost $2 billion of your money, that’s the problem. And so the money that they’re playing with is not their own money is, you know, and then and then. And then what happens is, is that it costs a lot of money to run a big operation like that. So they have their own operating costs all that so when you add all this thing and then when the money stops, and there was right for the bank, you have no choice was shut down the bank. So what’s going to happen is this guy, so a finish up real quick on the bank, they’re going to try to clear out all the assets and then sell whatever is left and see what left and they’ll pay a percentage to whoever’s over FDIC so that so I think on Monday, they’re gonna give you a so some sort of multiplier, some percentage, they’re trying to figure out what is less to sell at the bank. And so and so they so it’s very rare, but it’s so but the system works the regulars that the quick and fast, they halted the stock, so no people can lose who you want to wake up on Monday.

How Much Should You Put Your Money in a Bank?

Bao 1:00:00
Let’s get your guess how much you think the stock is gonna be?

Harry 1:00:07
Oh, man, I think, I don’t know, 10 bucks five bucks? Or do you think lower? People are saying like OTC types?

Bao 1:00:18
It might not even open guys. I don’t know. Let me take a look at the holes. Let me take a look at all. So we’ll go through the tour does a good segue to that. Okay, so if you’re a big wig, you have money at the bank, because you have a. So I have businesses, guys, and I have an account over 250 ,000. So there’s a big wake up call for me to I do my money not in these, these banks that I do traditional banking. So the number one is, if you want to save yourself, don’t put your money into these high flying banks that try to give you the best interest because they are investing your money. For 1%, I’m going to fucking teach my life guys that losing 100% My money will fuck me up. So what you do is you go back to traditional bank, don’t be scared. So I’ll give I’ll give you advice on how insurance works. We have Dc, FDIC $250,000. So if you have a million dollars, what you do is you need to open four separate banks. You people talking about sub accounts all that doesn’t work. You know why? Because it’s not by the account is by the category checking stock, whatever, they have categories that says you’re limited to $250,000 per category. Okay, and so we need to do is fight. So back in the day when I trade a huge size. I had mold I had like a few do I have every cow on the street every broker because I because FDIC only covered over 200,000 Whatever. Right? And so we’ll segue into that. But I’ll talk about the backstop. So what you do is this, if you’re a normal guy that has less than $2,000 in one bank, who gets a flood, it’s all FDA make sure it’s FDIC approved. That’s it. And you can find out by googling online, okay? But I have my money at Citibank, whatever, it doesn’t matter where it is, I used to have every fucking bank. Because the fear is, even though it’s insured guys, it may take time for you to get your money back. And, and you see my Harding over two hours, I had to call the branch manager, the branch manager had to call someone else just get $6,000 out, did not want to get me 6000, they were trying to they were trying to size me up, they were trying to convince me not to get they told me come back the next $6,000 I don’t want to think about what that does is talking. That’s my locate fees. You know, before some but it’s like it’s your money, right? And so what you do and who says you spread money around? The key is, why have all your eggs in one basket, right your money around or bank. So you shall give example. If your bank ATM limit is 500 bucks, you have a savings account in the checking account. Now you have 1000 And you have a couple of banks and now you go around but they do that purposely you want to get robbed and held and then you need to use ATM and they withdraw $100,000. Right. So that’s why it helps you but the key is, if you’re a traditional banker, if you do traditional banking guys find a traditional bank, even if you don’t find a traditional bank, it’s okay. Most of you guys probably don’t have two to $50,000 in cash just laying around just chillin in the bank, right. But if you do have more, split it up different banks. Now you know two and a 50,000 is the limit. If you have over a million if you have two and a $50 million. DM me, I will help you. So I’ll stop there. And that will segue into stock market and brokerage stock brokerages and this is why we’re here. We are day traders. So I want to tell you how to save your money. In case a stock brokerage goes down because the stock broker is the same thing as a bank. So I’m going to stop there any questions so far? Guys? Does that make sense? I mean, that’s kind of clear up and because I want to call everybody out this is fine. I just love it. It’s like Papa get popcorn out. There’s gonna be a next American Greed or, or a new Netflix documentary series. Yeah. And this is going to be good guys next week, take a breath, go take a piss drink some soda while you drink. And we’re talking about stocks and how you make money. When the stock market opens.

James 1:04:34
Funnily enough futures are ripping right. I think people tend to think that we’ve actually mixed this in the bud somehow.

Bao 1:04:42
So I mean, the futures moving is the fact you know, the FDIC moved in quick right? So they moved in quick and they said I’m gonna make everybody whole and then they act very quick versus if you delay it and the uncertainty every day is what kills the market, right? That’s already like, did the VIX go up? doubt is the VIX. Is there a vix like a 24 hour VIX.

James 1:05:03
There isn’t I don’t think so. But the VIX spiked on Friday, Thursday and Friday.

Bao 1:05:09
So people probably long the VIX overnight now is gonna drop down because markets are rebounding right. So the markets did exactly the opposite when people that’s because you know, I meant fear. The height of fear and panic is usually signal the bottom. When you see people lying on the streets, remember Greece, all that crap people fucking running them? Well, you see people lining up on a Sunday trying to get their money out. It’s like, words out, so the ball might be there. So if you’re sorting, when you see people on the street that you’re too late, dude, you should be shorting when you saw this, this guy, insider guy sweating and selling it stocks, right. And so the people that are shorting at 40 bucks, to be honest, the stock is going to tank.

James 1:06:01
Yeah, so vix futures are crashing from 27 to 23 Right now,

How Do You Protect Yourself in Stocks?

Bao 1:06:06
there we go. Exactly what I said, the VIX. It’s the fear index. So right now, people who I got my money back, right. People are afraid that the government don’t have no money to give them back or delays, right. But the fact that on Monday you got your money, bro, will get you 25 bucks.

Bao 1:06:26
So you have your checking account. So, but that doesn’t solve the situation. So exactly what I told someone I was like, you know, what’s gonna happen is gonna create it out. It’s gonna bounce. So after this, if you want to start with talking about stocks right now, and I want to give you a game plan, because that’s how I made money in the in Fannie Mae. So how do you protect yourself in banks? You know, the FDIC, Federal Insurance is two to $50,000. Same thing with stocks. If you have a stock trading account, and is under 250 1000, nothing to fear about nothing to fear. The only fear is don’t put yourself into some weird ass, non traditional brokerage. What’s up? Britain is really the neck guy. That guy treatment. I don’t want to say it anyway. Oh, weird as companies that try to circumvent parody charity rule. And so you get to these weird situations where you’re trading a sub account of some other sub accounts and the guy’s account. The first question got asked your broker, I’m telling you this, this is excessive for you to protect yourself. First of all, if you have under 2000 If you’re with a traditional broker, you’re going to look up you can look up Google they have a list that is the broker in is the broker licensed because it was licensed all that you have FDIC insurance, but if I create a new fucking brokers like a bow bow brokerage, you know, look it up, you can look up these brokers exists. But if it’s a normal brokerage guys, which most that we do, it’s insurance. So you’d have to worry guys don’t Don’t Don’t be panicking trying to get money out. You should panic only if you have like, over $250,000 Because if the broker brokerage did what they it happened, guys, because what happened is this your money should be segregated, right? Segregated funds. So the broker is supposed to take your money so that the broker doesn’t really have your money is the clearing firm and has your money? The broker is the middleman the broker is the cashier at fucking Whole Foods, right? He’s just fucking do your shit. He doesn’t hold your money. So who holds your money is a clearing firm? So you have to be very careful if you have a million dollars, okay, so I have many millions back in the day in the in a few trading cows. But every week I asked him so what happens this is the secret guys. So success traitor. The reason why I want success traitor because they they the parent company is Regal, Regal has been it’s a billion dollar public company. It’s been around for like years, like 30 years only as Billy. And I’ve been trading them as a private as a private trader that sold during the Fannie Mae days, all that stuff, right? I have a bunch of brokers. And they have so I asked him this because I have like $5 million in there, right? And so I’m like, were you only short federal FDIC was only $100,000. And I’m like, I’m not gonna open up fucking like, what can I find that many brokers right? So what they do is they have what’s called an insurance rider. It’s an insurance policy over FDIC. And so success trader has a 25 $30 million writer through Lloyds of London.

The System Is by Design

Bao 1:09:46
Others are through AIG. And that’s why back in the day, when they say too big to fail, AIG was insured was insuring everybody. So they had to bail out AIG if they did not bill AIG The whole system is systemic that’s why it’s too big to fail is because one insurance guy was securing everybody and all that crap. But I think I told you guys this up if you take US Treasuries they’re all ex Goldman Sachs CEOs. Yeah. So you see how the system works, guys. It’s works by design. Goldman Sachs, CEO, X. All those are the let’s take a look. You can go someone Google this for me while I talk. Harry James look like us treasures. And then Goldman Sachs. So that’s why they called the evil empire. So during the 2008 by bailout, AIG got bailed out. The only one of the people that got bailed out whole, like dollar for dollar was Goldman Sachs. They should be getting 50% 30% Like everybody else, right? The government bailout you everyone takes a hit. At least you don’t go to zero with Goldman Sachs 100% Why? Wait, wait, we won’t get into that. But the system is by design, don’t hate it. This system makes the people that are informed. That’s why you join in my see your forum. That’s why you’re here on this podcast webinar. How many people are here.

Harry 1:11:14

Bao 1:11:17
That’s good, that’s 200 people that’s more educated. And then we will keep playing this but um, so now you know how, particularly if you have a million dollars guys, you ask your broker, do you have additional writer insurance to cover that? Okay, I’ve had the so I talked to the CEO of success traitor yesterday, he’s going to come up with a letter to ensure everybody that their money is safe. Because you know, this, we I’ve done this back in two back in the day, guys, when it fell out scare too. So every fucking time I’m asking how do you insure all my cash. So this couple ways they didn’t share my cash back and they don’t want to insure cash much because this is fraud and so much fun and cash, but they will secure assets. So if you have, if you have $30 million in cash, they may not they may go up to 10. And I don’t know what this you need to ask. Okay? Because but, but that’s why you have they that’s why you buy let’s say an index fund or something stable because an asset like stocks is a shirt up to like hundreds of millions. Because you know, like they shirt a shirt, not because you’re gonna lose money assured, like something that someone steals like, you know, the crypto fucking banks, right? They fucking stole your crypto, right? It disappeared right? So they insurance from from theft and criminal activity. So cash you have to cash out it’s like this happens but but stock is hard because I do how you you’re gonna get my $10 million with my Apple stock. You can’t get that shit, right. It’s very difficult, right? But caching is still so anyways, so they have additional writers or I tell insurance and so I’m gonna get words for success traitor clients. I’m going to get out a letter from the CEO that will tell exactly what the limits are guys, and you guys are all protected. So the only people that should be scared or the people that have too much money this is your this is your wake up call guys. You’re saying that not all broke.

Bao 1:13:10
We work with trade zero. They’re us. brokers. They are FDIC insured. Same exact thing. Yeah. Yeah.

Harry 1:13:16
As long as it’s not some sketchy. Like you were talking about the long neck brokerage as long as it’s not some sketchy ass overseas.

Bao 1:13:25
A weird as shit that’s I will guess it same. But But don’t be afraid of what happened to SOCOM, you’re completely fine. Okay, you can play fine as a normal trader view completely fine. Let me see what else. Okay, any questions there guys. Any questions? I’ll stop and brokers before I talk about trading. And trading is going to be cool. I’m gonna I’m gonna give a game plan on how I see you guys making money on on these bank failures. But any questions on so we talked about banking? Okay, so you understand, okay, if you have more intuitive $1,000 in your bank, you’re screwed. Go find another bank and put it in. If you have $10 million, you will find a lot of banks or or or you put into an asset. You don’t need all that cash. So what happened is those that have more than millions of dollars in in cash they want to make 5%. So success trader I just talked to the CEO said Sucess Trader has t bills, special program with the treasury bills. Okay, those are insurance, obviously. Right. So US Treasury bills. They give you 5% annualized interest. When you park your money instead of parking your money into the bank and not getting FDIC they should have parked into treasury bills and put into straighter and you get 98% or something he said that you can trade off of it. So money is art. It’s safe and you can trade off of it. So one of the guys have over $1 million DMB On Twitter, we’re just talking about it. And I’ll tell you, I’ll let you talk to the CEO of Success Trader. Because that’s how you get protected guys, you have to understand most people never never anticipate bank failures. But I’ve been through you know, you know, you know, I’ve been through guys I’ve been through 911 I may look young and hot and fresh, but I’m an old man right? I’ve went through a lot of crap. I lived in New York City one mile downtown New York one mile from 90 level and a half and I was day trading. What happened is they shut down the markets. The stock halted and I live one month of that up on the great blizzard of New York City. The Northwest Blizzard, I’m sure you’ve been there dude. Like Blizzard blow everything I was there to the blackout? Do I think I’m an I’m a fucking magnet for disasters?

James 1:15:54
You wherever you go? Everywhere I go, bro.

Bao 1:15:56
I’ll tell you man, I lived through and lived through every freaking crazy disaster of the past. I’m an old man like many decades, right?

Do you think roku and square will have to file for bankruptcy?

Harry 1:16:03
So the other one of the questions I know James is gonna mention this one, too. One of the questions is, do you think Roku or square are gonna have to file for bankruptcy? Or do you think that they’re going to have to raise money.

Bao 1:16:18
So the government is going to help because they don’t want to just cause a systemic fear. What they’re gonna do is they’re going so I heard they, they’re gonna they’re gonna, because it’s not gonna go to zero. The bank has assets, the they stepped in very quickly before that, they can try to hide the money and do whatever they need to do. Right. So the bank took possession of the bank. That’s pretty fun, crazy. So go into possession of the bank. And so they’re gonna do that we don’t really know because we don’t know what the assets left of SIV be, you know, and so the government’s gonna figure that out, and then they’re gonna give them emergency money or the fucking maybe. Because you guys, if you have to in the $50 million, the only alternative 50 million US need to make payroll. Yeah, and that’s usually what it is. So, so so. So the fear was, fuck, then I lose all my money, it all of it out which is true, you’re gonna have $250 million, we’re gonna take out two to 50 million to 42 to 50 million minus 250,000. is so so for us normal people is five for the Roku, guys, they I’m pretty sure they’re working with the government to figure out what the ratio is that they can get access for funds. And, and to be honest, I guess now they’re gonna go traditional mob model of getting loans. So we’ll go he’s gonna get a loan.

James 1:17:37
You think they’ve stopped this before? It turns into like a 2008? Like type of financial crisis? Did they stop?

Bao 1:17:42
Because it wasn’t 2000 it was systemic meaning like, You got bailout AIG, it will take out a bank of others. So this is kind of systemic, but systemic. In what’s what magnitude? The bank has, how much under deposit? Can you tell me to look up? So they have most of these are startups guys, right? Apple is not there. Their single Valley Bank is a bank for startups. They have a loss. So this aesthetic is for someone said that it put took a valley back 10 years of innovation, because a lot of these companies will get wiped out. But they’re too small to care about. So there’s too big to fail and too small to care. You say so these companies are too small to care.

James 1:18:30
You think there’ll be a lot of startups not being able to make payroll or just slowly kind of shutting those.

Bao 1:18:36
Laws are it’s gonna get wiped out? They simply don’t have the funding. They lost the money. So I’m a VC venture capitalist, right? I gave you 25 million to do your startup. You put that shit into Silicon Valley.

The Systemic Nature of the Banking System

Bao 1:18:49
Wake up, it’s gone. You’re done. Sorry, you’re done. Bye, bye. That’s why That’s why these guys the systemic is not there’s multiple layers of systemic right forth. They don’t really give a damn and 50 startups die. But they will care if he doesn’t insure all your mortgages. Right so Fannie Mae and all that fucking shit, right? We’ll talk about trading a little bit but static is big magnitude or bigger than one bank. Lehman was systemic is because I think they had so many derivatives or whatever. I’m not, I don’t remember. But they they were tied to everything else too. There’s not just one bank going down. So Silicon Valley Bank. Yes, they had a lot of clients, but tell me how much is under a deposit, who will have real quick, how much how much under deposit and you’ll see the magnitude.

James 1:19:55
The SVB at 209 billion of total assets and about 175 5.4 billion in total deposits as of December 31 20 25%

Bao 1:20:04

So basically 100 50 million 100 50 billion how much was a mortgage? Exposure? Trillions, right? So it depends on who who dies that they could sue systemic. This is like okay, we’re gonna step in and save the the little guys is fine. But if the little guys go down there don’t get reelected so the I guess the law political is it’s gonna be a lot of political thing to tie to this because like Dude, I don’t want to say anything with Biden’s so how many billions now to Ukraine? Yeah and then let the backfill that’s why I made a joke guys. When people hate this joke I said what a tweet the joke you want to tweet put out into the comment section. I was like, so talk about like bank is a breaking Silicon Valley Bank changes his name to Ukraine Valley Bank to get funding from the government.

James 1:21:05
I have a little YouTube tag on it that says do not watch.

Bao 1:21:09
Yeah, you see. So when you see this, and you’re unaffected, meaning that you don’t have money in there. You get sad, okay, that’s the system dude, I’m really sad. What I’m sad about is if they don’t make regulation changes, they need to keep more your fucking cash available for you to go. That’s what I want. They need to change fractional, the percentage of fractional banking. And they need to, they need to set remember when when JP Morgan bought Chase. They had a trading firm investment firm and a traditional bank. And they’re like, What the fuck they need to segregate their money, you can be taking money from me and you and my mom and give it to JP Morgan to fucking like trade derivatives and whatever the fuck they’re doing right guys? It needs your funds. So you show the fact that happened. An investment bank is different than a traditional of a savings bank. They’re an investment bank, it’s not a foreign bank. They just call that shit banking is not banking. They made a different type of banking right? And so the fact that that happened guys you already knew that it’s just gonna happen again. JP Morgan now merges with Chase. JP Morgan is one that they don’t forget take deposits they’re fucking using that money to fucking day trade deals to do whatever they do. So the fact that that happened and then it took this long 10 years when when was when was the merger new merger JP saw the four DS before the 2008 you see so Man You see man didnt learn shit they combine fucking investment begging with traditional banking and this wasn’t gonna happen soon. Same fucking shit they go Valley Bank took your money and loss on bonds.

James 1:23:13
Down to like bigger banks like JP Morgan and like Bank of America do you think that people are going to be scared keeping their money even a little guys keeping their money at

Bao 1:23:22
Did I posted a meme? Remember the meme with a with a grim? post that to illustrate that too? Good point. Good point. Good fucking point. I’m gonna post this. You see all this shit ties in man and I’m glad that you guys see all this. So, Jim Cramer’s came out with a tweet that says JP Morgan is a fortress fortress

James 1:23:51
Personally I’m terrified!

Harry 1:23:53
So yeah, I’m actually terrified of that tweet.

Bao 1:23:56
So So James you hit it on the hit the nail on the head FTX was investing right there trading clients funds right? And now SVB and now JP Morgan Chase. And so what was the price and fucking jpm let’s take a look at the bucket to be honest I don’t trade this stuff guys. I don’t really give a full I will talk about trading up to this but you know, but it’s very interesting those that do I’m gonna give you a game plan on how you can fucking like, make money like I did on Fannie Mae.

Bao 1:24:25
Yeah, let’s give him one up. We’re not suddenly.

Coinbase Holds 240 Million in Signature Bank That Collapsed

James 1:24:27
Just in by the way. Coinbase holds 240 million in Signature Bank which has collapsed just over an hour ago.

Bao 1:24:37
Yeah, that’s another thing to coordinate all it said again. James repeat that again.

James 1:24:41
Coinbase holds 240 million in the latest bank that just collapsed about an hour

Bao 1:24:48
Coinbase Coinbase is gonna go great coin. So Coinbase put their money in there at will. They had

James 1:24:55
They had 240 million in the new which bank was at that just collapsed. The New York bank

Bao 1:25:01
Raises funds. That’s a lot of money.

James 1:25:05
Signature Yep 240 million and now collapsing interbank.

Bao 1:25:09
Oh my so what’s the Coinbase tank on Friday?

Harry 1:25:13
Well just they just popped close now.

James 1:25:15
Yeah. Just closed today public company saying interbank is

Bao 1:25:24
not I don’t believe so Coinbase did take on Friday.

James 1:25:30
Signature Bank is SPNY? Yes. SB

Harry 1:25:37
SBNY it’s down 22% on Friday.

Bao 1:25:41
Yeah Do you think so the coin base tank because that is that the close off

Crypto-Backed Companies Are Greedy

James 1:25:49
The scary thing is Coinbase tanked before news came out that SPNY was closing and being shut down by regulators. So what is that going to do a public company like Coinbase who is called crypto backed I mean they’re public and it’s huge in the crypto space guys do?

Bao 1:26:03
You guys just did you guys just hear what I just said to you guys earlier about these crypto motherfuckers.

James 1:26:09
This is a good nice world right or right back.

Bao 1:26:12
This guy’s you see and then also the tweet that Jim Cramer posted makes sense to you right that’s what people are scared shitless because every so every bank that is trading your money is exposed to interest rates fluctuations like that and these banks they’re moving billions of dollars guys they don’t they don’t just by little by G and S Stock they they they just want to make their few percent points and off liabilities there’s a lot of money right even make a 1% 1.5% on buildings on money and so now so these guys are all fucking training your fucking money and that’s not cool that’s why it’s I think credit unions are better sometimes. So you if you want to be safe research credit unions their fees are lower and all that you really don’t need a traditional big bank guys unless you want to do loans and all that I think credit unions have loans into too so this is a good this is a good wake up call guys for everybody to audit audit where they put their money who they trust their livelihood to we sometimes we we take it for granted because it to be honest, it doesn’t happen often and when it happens guys me you say we’re not billionaires. I don’t have fucking 50 million sitting around if I did I put in real estate which I do so I’ll talk about that a little bit too but but all these companies are greedy they’re greedy for a reason because a worse and worse and worse all the time and it works all the time. They just need a loan to loan to get out their little problem. Makes sense. So real simply with Tesla guys remember, Tesla just needed a little loan they got a $50 million loan which prevented him from going bankruptcy and now they went from near bankruptcy they’re literally hours from bankruptcy. They got $50 million loan then they went because of that they did go bankrupt they became a trillion dollar company so if these banks had to pour 5 billion just someone just loan shark gave it to him for a few hours two days a few weeks they will gather this gem but if you don’t have that money you must sell your assets. You see an asset is a bond is all that fun stuff as well.

James 1:28:25
Bitcoin futures are up 10% Even with Signature Bank going down.

Bao 1:28:31
You know why? Because you know I put it goes up because it’s the run for the banks people think that decentralized as a bank, they will trust the banks. It’s not because of this shit is because in my opinion, there’s my opinion obviously. People people are idiots they don’t understand. They think that oh the banks are safe. The banks are not safe. Don’t ask this safe is safer than your fucking crypto. You put out Coinbase you put that money in your Coinbase and see whatever happens on Monday I don’t think they can be said that they can take money out right they put up something that said they can’t take money out because the US dollar.

James 1:29:03
Yeah, there was a lack of withdrawals I believe when USDC got the pegged. Now bitcoin is squeezing. This is awesome. It’s almost like they’re listening to us. Yeah.

Bao 1:29:16
So So what’d you guys do as this guy so you guys were all protected, guys. We’ll be very glad that you guys came on. How many people show up with us on the podcast, guys?

Harry 1:29:25

Bao 1:29:26
That’s our best. So don’t worry. So let’s talk about next step was trading how you make money. How do you make money? You make money. When I Warren Buffett says guys you buy when there’s fear, right? When people are selling which is true. So what happened is people think that the stocks go to zero overnight, a company is bankrupt goes to zero so they go all in on the short and that’s how they get squeezed. Bankruptcy takes a year years. It won’t go to zero. But new traders oh shit is gonna go all in on the short so what happens is this there’s usually a squeeze before it goes down because there’s a lot of people that want to get out you remember AMC stock you like what they’ll rip everybody up and then went down there were backup insiders need to get out their friends and family to go fuzzy to go the funds will have access to insider information now take a look at sVB how many? I oh, let’s take a look that’d be interesting. institutional ownership.

James 1:30:46
That was putting fantasy orders are somewhere around 96.5%

Bao 1:30:48
Investor institutional ownership 96.5% is a real company. You think these institutions got out there trying to kick it out? There’s no liquidity and plus there they woke up just like us know what the forecast they’re calling the guy the bank like makes up the guy’s not picking up so how you make money Don’t fucking short this shit this low you’re gonna wait and watch where it capitulates where the fear is at the maximum where your mama your kids are loud like the door trying to take your money out trying to scare you to bigger see, at that point go long after everybody gets out, I don’t care where it is.

Put a Stop Loss on Your Short Thesis

Bao 1:31:36
But if you short put a stop loss so Fannie Mae went down from pennies. It’s up to like five bucks who are the fucking maybe? Yeah, okay, because people have enemies well Begu it did it went to the bullet points and went backup. But nothing goes zero guys. Fannie Mae is still trading at 43 cents I looked at right now 43 cents I thought was no backup know how long they Kmart and all that. Okay. So there’s always an opportunity. The opportunity for short selling was Yesterday was Friday. Right? As IV B was $700 not too long ago. Take a look at the chart. This is a very difficult stock to it’s gonna be so liquid. It’s gonna be so liquid man. It’s going to jump up down like crazy. It’s gonna be very difficult to trade. I like to watch for fun but they always want to gamble. Okay, you have to put stop losses. And you have to in my opinion, the way you make money look at FRC. Look at the chart FRC guys. FRC look at Friday. Thought FRC first republic bank is going bankrupt just like smdb Take a look what happened 100% squeeze right.

Harry 1:32:51

Bao 1:32:54
Look guys at home that are watching this FB I don’t know you put the chart how that plays the chart guys.

James 1:33:01
I got a piece of chart. I don’t know how you can do that. We need our technician Joe on one how do I comment? How do I comment?

Harry 1:33:09
You should have a comment section to the right so I myself.

James 1:33:15
Think 10 Do those two I say that I’m not sure.

Bao 1:33:20
But anyway guys, what was a low let’s take a look at the low the low and the high FRC didn’t touch the ShitI’m thinking I’m like because I was I mean this is not my my niche so you know the low was it open at 70 bucks. The lowest 45 bucks and it closed at where it was I guess 75 bucks or something 77 Where’d it go? 45 it closed at 70 bucks 70 bucks. Okay, it was 78 bucks here I’m gonna show you and I will put it in his MRC chat whenever he goes So it went from seven actually the day before was 95 bucks guys it went from $95.95 bucks there we go to five bucks and the balance is like 100% boughs because if you see that’s where the money’s at the money is made when there’s fear of panic so sick right guys?

The Best Time to Short Silicon Valley

Bao 1:34:25
So that’s the sort of bounce play that you would want from SIVB be Silicon Valley you’re looking because it’s not gonna go to zero regular stepped in and then it takes time and so you know bankruptcy. So everybody when it goes on bankruptcy is the best time if you if you really track it to make money because there’s so much speculation up and down and so the moment it starts to turn because there’s a lot of people that want to get out of the stock guys and so they will make a scenario which is like AMC, the apes want to you know, the insiders want to get whatever the fuck they’re gonna bounce this stuff so that they’re Well let the insiders get out and the moment everybody the big guys get out, it’s going to take them. So there’s going to be a period of big 100% bounces. Just like FRC, you saw that? How the hell is a company FRC bounce 100% Because it was $120.02 days ago with the 45 bucks on fears, just fears. Let’s look at jpm see what Cramer did to JPM tanked and went all the way back. JP has a real company so it’s in and it’s just purely speculative. There’s no reason but the whole sector goes down. So as a sympathy play, so where you make money is this you? Shorting is an obvious thing, but you don’t want to short low you wait for it to do the 100% bounce. Right? Like if I FRC so if it bounces back up to 9500 120 those are the FRC you say. But when it’s something like 45 bucks unless it’s it’s truly happened not speculative. You just got killed shorting it. So don’t short road. If you miss it, you miss it and just wait for the long wave for capitulation to happen wait for it to stop bouncing up and you just go there and you put a stop loss. These things are notoriously difficult to trade if you’re if you are on the wrong side of the stock and you do not have a trading plan which includes risk management and stop losses. You’re going to get wiped out because all you do is you’re reacting play the news. The way I play FEMA I made a lot of money through FEMA Fannie Mae because people thought they’re gonna go bankrupt and then their Senate hearings to bail him out or not to bail him out. Do you know I’m saying the government was going to take over there’s all these speculative shit and that’s how I made my money. I’m gonna make money by writing it up and now I made my money to fools I went long when they have sentimental meaning that says they may bail them out whatever. And so start going up. But you know, it’s all bullshit. And so the moment he reaches the top I shorted so the way you trade this is you have to be smart guys don’t don’t go for the hype. No, the thing that I did well was I knew that these companies don’t go bankrupt to zero right away. But when you knew trading he’s like oh shit, it should go to zero. Why is that 06 months later it won’t go to zero guys won’t go to zero. It’s gonna be long time because you have bankruptcy proceedings have to liquidate and so during that time, there’s a lot of good opportunity to trick us there’ll be speculation speculation is how you make money day trading. There’ll be speculation on you make money off speculation right? So it’s speculation that Silicon Valley Bank is gonna go bankrupt it’s gonna fail that’s why it tanked right there’s money right there. So So if people are speculating is going bankrupt you short but you’re too late now. The news is out. So in my opinion, it’s gonna tank really badly on Monday. And then what’s gonna happen is is it gonna bounce? I guarantee you it’s gonna bounce something big tap house is everyone’s scared right the one where you get all the weak Long’s out right that’s no more selling right? The bounce is called dead cat bounce. And so you if you’re in this Stock Good luck I would dump it but don’t dump all take a look at the support that’s it. I mean, this is when it opens it’s going to get down guys and that’s the thing man it’s really difficult when you just have to I really don’t know what the hell’s gonna happen because if I’m in the stock I am I will don’t have I would have have because a few go lower.

James 1:38:37
Might be purchased anyways, I mean there’s no way of actually knowing what’s going to happen.

Bao 1:38:42
Then why don’t you ever trade myself out of it? Or just fucking walk away say I fucking fucked up and then but it’s gonna have a big bounce sometime. Okay, it’s good because what’s happened is that it was gonna start selling who knows it’s gonna start selling and then when everyone panics is there an impact every out first? It’s they can’t it’s not day guys. It’s the people that have it they get when you get a margin call all these people are on buying some margin right? You know, the the broker is going to automatically sell them out you have no choice if you go under 20% of your so depending on so if you are if you’re just normal day trader and you bought a 34 bucks I see some people on Twitter by 34 bucks and you wake up at four to five bucks you’re done. If you buy a margin you’re done they so it’s gonna gap down artificially lower is because the brokerages are liquidating everybody at market and so you’re gonna get the mat that’s why you’re gonna get that dead cat bounce because depending on how much he goes down in my opinion is five bucks everyone that’s getting liquidated that is on margin. Okay, if you’re on fucking full margin on this shit, you have fucking you’re done. You have no control. You’re gonna wake up, your account is locked in and you’re your broker has your account set to sell market and open sell open whatever the fuck it is right? So that’s why you had this this gap down and so you’re gonna get big and so once they get everybody out the market makers who’s buying this stuff right the shorter buy this but more importantly the market makers they they see all the orders from the brokerages they see you they see all the positions as flat that sell at market, sell it open. So they have zero algos guys, not human beings. This is like supercomputer figuring out all the shit. And all the data, they know exactly where to fucking open up to take all of the sell and market. Okay, and so they’re gonna take all this shit and it’s gonna bounce. Because I see that because a lot of the new comer they always gonna go zero, right? So wherever fuckin opens is going to go a little lower obviously. And then they my piece got bounced because I have big bounce. And then, you know, sell the house or Fox Chase app, and then comes a fade.

Harry 1:40:56

Investors Should Not Chase the Hype of the Market

Bao 1:40:58
And then it’s going to consolidate for the rest of the day. append new news. So what it’s trying to do is trying to resolve all of the upside down long’s that are on margin. So the broker is going to sell CBD out. And then it’s going to pay all the normal people. And then the funds whoever funds into it, they’re making a deal right now guys, I’m pretty sure. These funds if you have five 10 million shares of this house, get rid of it, right? How do you get rid of it? So you, you’re gonna make back end deals with people, this is the whole thing that you saw the Lehman Brothers kind of shit, right? I want to sell all these credits yet, I’ll give you 50 cents on the dollar, you’re shopping around, you should like that. Right? And so they’re making their back end deals already. So it’s difficult from a retail point of view, because we’d have so little exposure to this, that we don’t know what the fuck is gonna happen because they will open it where the fuck that they find a buyer. Okay, someone was gonna step up, they’re gonna be a price that someone step up. And the person that steps up is a person that understands their, their balance sheet that has gone through they have two days over the weekend with 100 Associates, Junior bankers, no sleep, figure out exactly what how much money Silicon Valley has exposed, how much money they have a case of liquidation bankruptcy. These are numbers that they can’t find out, right, if take enough time, they’ll find out exactly how much cash they have, how much assets they have stocks, they can make sense. So they know the value of the bakery. So it’s just that I’m trying to get people out of the algo structure out so they get you know and so that’s a that’s a sort of nature that you’re fighting against you this is why I trade small caps because small cap everything is a scam. There are enough fucking big banks working with a billion dollar research firms to figure out what the value of GNS is zero. Right so So now you understand how this works, man. They’re trying to they’re trying to find a buyer for the stock just like they’re trying to buy and find a buyer for the bank. So there’s at some point Black Rock is gonna step up I’m gonna fucking buy a billion dollars or Citadel, right? So they’re just trying to figure out what the price that the biggest worth, because they’re gonna figure out from the regulars and we can then do it’s all it’s our job, guys. It’s always other shit, right? So once again, guys, once again, do not chase the hype. If this thing is ticking, if you want to join it, do it but set a stop loss because it will reverse quicker than you can mentally stop out. And when that happens, it may halt.

James 1:43:42
We’ll talk about an MIC in main chat we’ll be talking about.

Bao 1:43:44
Today. We’ll talk all about this, we wake up and you do this.

James 1:43:48
Yep, we’re coming up on an hour and 45 on this which means it is time for us to start wrapping it up here.

Bao Speaker 1:43:54
Any last questions guys?

James 1:43:58
Value have been incredibly informative.

Harry 1:44:00
Yeah, this is really good to listen to.

James 1:44:03
I rarely just sit here and listen. And that was that was awesome.

Bao 1:44:07
To 2014 1315 years. I’ll see you in 15 years for the next one the next guys up at the AI bank artificial intelligence to have any questions guys we will see you online on Twitter. Am I see whatever it may be guys. successtrader guys is completely insured will send a letter, so don’t have to worry about success tr. We’re gonna post this up. Maybe tomorrow actually, I don’t know.

Harry 1:44:38
Yeah, we’ll post it. We’ll let the recording come through and then we’ll post it. So yeah, thank you everyone for joining. You know, this has been super informative. Thank you bow. Thanks, everyone. Definitely a great awesome live so I mean, we’ll we’ll leave it at that and thanks everyone and Yeah so yeah.

Bao 1:45:01
All right thanks guys awesome


About the Author
119 posts
James F.

James Freedlender is a driven day trader and entrepreneur hailing from Boston. Since embarking on his trading journey in 2018, James has honed his skills and specialized in trading penny stocks, with a focus on longer time frame moves. His dedication and sharp instincts have contributed to his success in the competitive financial world. In addition to his day trading accomplishments, James is a thriving business owner, running a popular barbershop and collaborating with his family in the design and renovation of homes and businesses. His entrepreneurial spirit and keen eye for detail have paved the way for continued success in his various ventures. Outside of his professional pursuits, James is an avid golfer and hiking enthusiast, always eager to explore new trails and perfect his swing. His love for travel has taken him to many corners of the world, enriching his life experiences and providing inspiration for his work. A firm believer in giving back, James is passionate about helping others achieve their financial goals and guiding them on the path to success. His wealth of knowledge, combined with his dedication to uplifting others, makes James Freedlender a respected and admired figure in both his professional and personal life.