And now for something really important...SVB failure.

[Texas Contrarian]

Originally Posted by the_real_Barleycorn

I was the OP and I didn't ask that question. Are you trying to hijack my thread?

Have you ever considered using this site's quote feature?

Who did you intend to address, and in what way were they hijacking the thread?

[VitaMan]

Originally Posted by Texas Contrarian

I "get it" perfectly well.

I'm done discussing this with you, since you obviously like to argue for the sake of argument, but often (as here) have demonstrated little effort to gain a nuanced understanding of the topic under discussion

Got it?

You are the one who replied to my post with the pejorative "Got it ?".

The stampede caused the bank failure.

As to what caused the stampede...that is open for discussion and it looks like you are discussing it at length very well.

[Texas Contrarian]

Originally Posted by VitaMan

You are the one who replied to my post with the pejorative "Got it ?".

The stampede caused the bank failure.

As to what caused the stampede...that is open for discussion and it looks like you are discussing it at length very well.

And before that, you sniped at me by posting that I was "getting off track." Wrong. What I posted is quite germane to this issue, to say the least. Note that the pace of panicked withdrawals from SVB significantly accelerated after the eroded valuation of the bank's unhedged bond portfolio began coming to light.

[bambino]

https://t.me/c/1428896786/772052

[Tiny]

Originally Posted by VitaMan

No panic withdrawal of bank demand deposits....no bank failure or crisis

Got it ?

Originally Posted by the_real_Barleycorn

I was the OP and I didn't ask that question. Are you trying to hijack my thread?

Man, talk about shooting the messenger. Have you gentlemen actually looked at SVB's financial statements? I bet Texas Contrarian has. He's spot on topic.

Barleycorn, you want to blame the bank failure on ESG considerations and possibly payoffs. VitaMan, you say the cause was a run on bank deposits. And there's a lot of merit in what both of you are saying, except for possibly the payoffs -- I don't think we have any idea on that yet.

Texas Contrarian is getting at the deeper root of the problem. Say there had been no bank run. If interest rates stay at elevated levels, versus the years before 2021, SVB would eventually fail to meet regulatory capital ratios. The bank would have to raise capital, merge, or go out of business. TC is telling you how that came to be, why the bank was sitting on government backed securities that yield less than what SVB had to pay on non-demand deposits.

And yes, just as we're looking at bank failures because of changes in interest rates and flighty bank depositors, we also may be looking at a massacre of pension fund assets, and the ability of some of the funds to pay pensioners a decent retirement. The value of longer term bonds, a favorite asset of pension funds, has plummeted. I don't know how the Pension Benefit Guaranty Corporation (the FDIC of defined benefit pension plans) and state equivalents are funded, but I bet that it's the taxpayer who will take the hit if we have a pension crisis. The current carnage in the banking system likely will be paid for by the banks (actually their customers and shareholders) through higher FDIC insurance charges.

You can't just blame bank management or depositors. Fed policy played a big roll in this. I'd argue too much fiscal stimulus, in particular Biden's American Rescue Plan, passed in March, 2021, played a roll as well, in the inflation that resulted in higher interest rates. The Fed should have started raising rates in 2021 IMHO, when we started experiencing much higher inflation.

[the_real_Barleycorn]

Only VM asked about what the OP was talking about.

[lustylad]

Originally Posted by lustylad

Thanks man, for parroting Liz Warren's new talking point. Now can you do everyone a favor and cite the specific Dodd-Frank provision that would have prevented the collapse of SVB, had it not been relaxed?

Fauxcahontas couldn't.

Originally Posted by royamcr

In 2019 the Federal Reserve compounded the pullback from Dodd-Frank by instituting new rules that eliminated liquidity requirements entirely for banks with assets under $250 billion and softened other regulations.

SVB’s deposits surged from $50 billion in 2018 to $220 billion in early 2022, it remained conveniently below the new standard that would have triggered more oversight and higher capital-adequacy requirements.

Thanks man, that sounds like a pretty intelligent comment. Are those your own thoughts?

You do know that if/when you're quoting someone else, the proper thing to do is to put the comment in quote marks, right? I mean, you wouldn't want to mislead anyone into thinking someone else's thoughts are your own, would you? That would be plagiarism. And if you got caught plagiarizing, you would look highly dishonest. Your credibility as an eccie poster could be irreparably damaged.

Oops! Look what I found... from the WSJ dated 3/14/23, an opinion piece by William Galston.

Looks like you lifted those two sentences verbatim from the Galston article, didn't you? (Verbatim means word for word, no paraphrasing.) I even highlighted them for you.


How Silicon Valley Bank Avoided Oversight

Before the collapse, its CEO lobbied for a loosening of Dodd-Frank reforms, risking financial stability.

By William A. Galston
March 14, 2023 1:22 pm ET


Martin Gruenberg, chairman of the Federal Deposit Insurance Corp., delivered remarks March 6 on the state of the banking system to the Institute of International Bankers. He reiterated his long-held view that the regime of high and rising interest rates would impair banks’ longer-term-maturity assets, pointing out that rate increases had already reduced the value of these assets by $620 billion. He warned that these unrealized losses “weaken a bank’s future ability to meet unexpected liquidity needs.”

Silicon Valley Bank’s collapse four days later, followed swiftly by Signature Bank, another midsize financial firm, validated his concerns. (A smaller firm, Silvergate Capital Corp., had closed at midweek.) Depositors’ confidence in the soundness of these institutions evaporated, generating a classic bank run that led federal regulators to step in. (Disclosure: My son heads two venture-capital funds that have invested in startups with substantial deposits in SVB.) Over the weekend, regulators decided to guarantee depositors for the full amount of their accounts, though the formal FDIC guarantee is capped at $250,000 per depositor.

On one level, this is a saga of bad management. As deposits soared, SVB’s executives had invested in long-term assets without hedging adequately against interest-rate risks. And the firm lacked a diversified portfolio of depositors, most of whom came from the venture-capital sector. As the sector came under increasing pressure, its members tried to withdraw their funds simultaneously, and the bank couldn’t meet its obligations.

But there is a story behind this saga. After the financial collapse in 2008 and the ensuing Great Recession, Congress passed the Dodd-Frank Act of 2010 to regulate the banking practices that had nearly plunged the world into a second global depression. Among other measures, Dodd-Frank imposed new reporting requirements on banks, toughened standards for capital adequacy, and restrained banks’ ability to use deposits for speculative investment. Banks with assets above $50 billion were deemed “systemically important” and subjected to especially strict scrutiny.

These standards brought greater stability to the sector, but also higher expenses and lower profits. Bank leaders weren’t pleased and soon began lobbying to mitigate the legislation’s impact on their operations. SVB’s CEO Greg Becker was an early objector who argued that subjecting his midsize bank to the full range of Dodd-Frank requirements “would stifle our ability to provide credit to our clients.”

The advocacy of Mr. Becker and other like-minded financiers bore fruit in 2018, when Congress enacted an amendment to Dodd-Frank that quintupled the threshold of systemic importance, from $50 billion to $250 billion. Although SVB’s deposits surged from $50 billion in 2018 to $220 billion in early 2022, it remained conveniently below the new standard that would have triggered more oversight and higher capital-adequacy requirements.

In 2019 the Federal Reserve compounded the pullback from Dodd-Frank by instituting new rules that eliminated liquidity requirements entirely for banks with assets under $250 billion and softened other regulations. In a blunt dissent, then-Fed Gov. Lael Brainard, now the head of President Biden’s National Economic Council, stated that by going beyond the requirements of the 2018 amendments, the central bank was putting the future stability of the financial system at risk. She lost that battle, setting the stage for the recent collapse of three midsize firms and the possible threat to many others.

The federal government’s decision to guarantee uninsured deposits, which required a two-thirds vote of the boards of both the Fed and the FDIC, raises some difficult questions. Taking this step required federal officials to determine that the financial system faced a “systemic risk.” There is reason to wonder whether the collapse of a handful of midsize banks actually posed such a threat, though it is understandable that regulators were risk-averse. With the financial system already in a $620 billion hole, a contagion of fear could have spread across the system with catastrophic results.

Some observers fear that the decision to disregard the $250,000 cap on insured deposits could generate irresistible pressure to insure deposits fully regardless of the amount. This would undermine the purpose of the cap, which was to give large depositors an incentive to monitor the conduct of their banks and subject the system to market discipline. A total guarantee, many argue, is an invitation to irresponsibility. This may be right. On the other hand, it’s hard to see how forcing startups to assume the burden of due diligence promotes efficiency or economic growth, especially when the government is in a better position to handle it.

Not all regulations are “burdensome.” Some are essential to prevent bad things from happening, as in this case. Congress and the Fed should rethink their decision to exempt key parts of the financial system from the discipline of oversight.

https://www.wsj.com/articles/how-sil...bying-5b3ff837

[lustylad]

So... now that we know where that opinion came from, let's see how much truth there is to it.

Mr. Galston's argument is that the easing of certain Dodd Frank Act regulations in 2018 - more specifically, the removal of its liquidity requirements for banks with under $250 billion in assets - enabled the collapse of Silicon Valley Bank.

Hmmm... first, let's look up what the Dodd Frank liquidity rule stipulates. Here's what I found:

"The largest institutions, including Citibank, Bank of America, and Goldman Sachs, will be required to hold up to 9.5 percent of their assets in liquid capital (such as cash, government bonds, or other assets that are deemed to have a very low risk profile)."

https://fin.plaid.com/articles/major...risk%20profile).


Now what was SVB's actual liquidity ratio? If I glance at its balance sheet and simply add cash + investments in Treasury securities, the ratio has been comfortably in excess of 9.5% for every year-end reporting date going back 5 years:

12/31/2022 - 12.4%
12/31/2021 - 11.2%
12/31/2020 - 16.4%
12/31/2019 - 15.9%
12/31/2018 - 12.3%

No red flags there. So enforcing that Dodd Frank mega-bank liquidity rule wouldn't have made a tinker's damn bit of difference since SVB was already complying with it.

But if you glance at other key ratios, you will note that SVB was using deposits to fund a whopping 82% of its entire balance sheet. At end-2022, its total deposits ($173 billion) were TEN TIMES what it was carrying in US Treasury securities ($17.2 billion). And most of its investments ($91.5 billion) were in MBS, which are also longer-maturity assets and therefore heavily subject to interest-rate risk.

Here's a balance sheet summary if anyone wants to check the numbers:

https://www.wsj.com/market-data/quot.../balance-sheet

My point is Dodd Frank or no Dodd Frank, SVB's flawed business model made it vulnerable to deposit runs. If a bank has a strong GRANULAR deposit base consisting predominantly of small accounts holding under $250k, that's a good thing. Banks love small checking accounts because they represent free money. Depositors are fully insured by the FDIC and therefore unlikely to flee. In SVB's case, a whopping 97% of deposits were over $250k and thus uninsured. That was a huge Achilles heel, compounded by management's stupidity in being blissfully unaware of how the Fed's interest rate hikes throughout 2022 were denting the market value of their irresponsibly long-dated, unhedged investment portfolio.

And then there is the fact that the easing of Dodd Frank rules didn't keep federal regulators from noticing the dramatic increase in SVB's risk profile last year, along with management's incompetence in even addressing, let alone mitigating it. Here's a NYT story worth reading:

https://www.nytimes.com/2023/03/19/b...lley-bank.html

This part is jaw-dropping:

"It became clear to the Fed that the firm was using bad models to determine how its business would fare as the central bank raised rates: Its leaders were assuming that higher interest revenue would substantially help their financial situation as rates went up, but that was out of step with reality."

So they designed a "stress test" that told them the road ahead was all clear as they drove the bank off a cliff!

You really have to wonder how these knuckleheads ever got promoted to senior management levels at a $212 billion US commercial bank in the first place!

[eccieuser9500]

Originally Posted by lustylad

Thanks man, that sounds like a pretty intelligent comment. Are those your own thoughts?

You do know that if/when you're quoting someone else, the proper thing to do is to put the comment in quote marks, right? I mean, you wouldn't want to mislead anyone into thinking someone else's thoughts are your own, would you? That would be plagiarism. And if you got caught plagiarizing, you would look highly dishonest. Your credibility as an eccie poster could be irreparably damaged.

Oops! Look what I found... from the WSJ dated 3/14/23, an opinion piece by William Galston.

Looks like you lifted those two sentences verbatim from the Galston article, didn't you? (Verbatim means word for word, no paraphrasing.) I even highlighted them for you.


I would state "emboldened". Sir.

Just sayin'.

Well done, though.

[eccieuser9500]

Originally Posted by lustylad

So... now that we know where that opinion came from, let's see how much truth there is to it.

Mr. Galston's argument is that . . . .


You really have to wonder how these knuckleheads ever got promoted to senior management levels at a $212 billion US commercial bank in the first place!

Sometimes you just get lucky. Then old habits die hard.

[The_Waco_Kid]

Originally Posted by lustylad

Thanks man, that sounds like a pretty intelligent comment. Are those your own thoughts?

You do know that if/when you're quoting someone else, the proper thing to do is to put the comment in quote marks, right? I mean, you wouldn't want to mislead anyone into thinking someone else's thoughts are your own, would you? That would be plagiarism. And if you got caught plagiarizing, you would look highly dishonest. Your credibility as an eccie poster could be irreparably damaged.

Oops! Look what I found... from the WSJ dated 3/14/23, an opinion piece by William Galston.

Looks like you lifted those two sentences verbatim from the Galston article, didn't you? (Verbatim means word for word, no paraphrasing.) I even highlighted them for you.


How Silicon Valley Bank Avoided Oversight

Before the collapse, its CEO lobbied for a loosening of Dodd-Frank reforms, risking financial stability.

By William A. Galston
March 14, 2023 1:22 pm ET


Martin Gruenberg, chairman of the Federal Deposit Insurance Corp., delivered remarks March 6 on the state of the banking system to the Institute of International Bankers. He reiterated his long-held view that the regime of high and rising interest rates would impair banks’ longer-term-maturity assets, pointing out that rate increases had already reduced the value of these assets by $620 billion. He warned that these unrealized losses “weaken a bank’s future ability to meet unexpected liquidity needs.”

Silicon Valley Bank’s collapse four days later, followed swiftly by Signature Bank, another midsize financial firm, validated his concerns. (A smaller firm, Silvergate Capital Corp., had closed at midweek.) Depositors’ confidence in the soundness of these institutions evaporated, generating a classic bank run that led federal regulators to step in. (Disclosure: My son heads two venture-capital funds that have invested in startups with substantial deposits in SVB.) Over the weekend, regulators decided to guarantee depositors for the full amount of their accounts, though the formal FDIC guarantee is capped at $250,000 per depositor.

On one level, this is a saga of bad management. As deposits soared, SVB’s executives had invested in long-term assets without hedging adequately against interest-rate risks. And the firm lacked a diversified portfolio of depositors, most of whom came from the venture-capital sector. As the sector came under increasing pressure, its members tried to withdraw their funds simultaneously, and the bank couldn’t meet its obligations.

But there is a story behind this saga. After the financial collapse in 2008 and the ensuing Great Recession, Congress passed the Dodd-Frank Act of 2010 to regulate the banking practices that had nearly plunged the world into a second global depression. Among other measures, Dodd-Frank imposed new reporting requirements on banks, toughened standards for capital adequacy, and restrained banks’ ability to use deposits for speculative investment. Banks with assets above $50 billion were deemed “systemically important” and subjected to especially strict scrutiny.

These standards brought greater stability to the sector, but also higher expenses and lower profits. Bank leaders weren’t pleased and soon began lobbying to mitigate the legislation’s impact on their operations. SVB’s CEO Greg Becker was an early objector who argued that subjecting his midsize bank to the full range of Dodd-Frank requirements “would stifle our ability to provide credit to our clients.”

The advocacy of Mr. Becker and other like-minded financiers bore fruit in 2018, when Congress enacted an amendment to Dodd-Frank that quintupled the threshold of systemic importance, from $50 billion to $250 billion. Although SVB’s deposits surged from $50 billion in 2018 to $220 billion in early 2022, it remained conveniently below the new standard that would have triggered more oversight and higher capital-adequacy requirements.

In 2019 the Federal Reserve compounded the pullback from Dodd-Frank by instituting new rules that eliminated liquidity requirements entirely for banks with assets under $250 billion and softened other regulations. In a blunt dissent, then-Fed Gov. Lael Brainard, now the head of President Biden’s National Economic Council, stated that by going beyond the requirements of the 2018 amendments, the central bank was putting the future stability of the financial system at risk. She lost that battle, setting the stage for the recent collapse of three midsize firms and the possible threat to many others.

The federal government’s decision to guarantee uninsured deposits, which required a two-thirds vote of the boards of both the Fed and the FDIC, raises some difficult questions. Taking this step required federal officials to determine that the financial system faced a “systemic risk.” There is reason to wonder whether the collapse of a handful of midsize banks actually posed such a threat, though it is understandable that regulators were risk-averse. With the financial system already in a $620 billion hole, a contagion of fear could have spread across the system with catastrophic results.

Some observers fear that the decision to disregard the $250,000 cap on insured deposits could generate irresistible pressure to insure deposits fully regardless of the amount. This would undermine the purpose of the cap, which was to give large depositors an incentive to monitor the conduct of their banks and subject the system to market discipline. A total guarantee, many argue, is an invitation to irresponsibility. This may be right. On the other hand, it’s hard to see how forcing startups to assume the burden of due diligence promotes efficiency or economic growth, especially when the government is in a better position to handle it.

Not all regulations are “burdensome.” Some are essential to prevent bad things from happening, as in this case. Congress and the Fed should rethink their decision to exempt key parts of the financial system from the discipline of oversight.

https://www.wsj.com/articles/how-sil...bying-5b3ff837

Originally Posted by eccieuser9500

Just sayin'.

Well done, though.

indeed it is.


thank you valued poster.

[Tiny]

Originally Posted by lustylad

"It became clear to the Fed that the firm was using bad models to determine how its business would fare as the central bank raised rates: Its leaders were assuming that higher interest revenue would substantially help their financial situation as rates went up, but that was out of step with reality."

So they designed a "stress test" that told them the road ahead was all clear as they drove the bank off a cliff!

I eat lunch with a banker a couple of times a week, and in months past he was just bursting with joy at the thought of how much money he was going to make when interest rates went up. Apparently he figured rates would go up on the bank's loan portfolio faster than on its deposits. He's been laying low for the last week or so, since the meltdown started. I'm hoping to catch up with him tomorrow.

Anyway, here is SVB's estimated percentage increase (decrease) in net interest income for specified changes in market interest rates, in its 10K. Market interest rates are defined as "the national prime rate, SOFR rates, 1 month and 3 month LIBOR, and Fed Funds target rate."

December 31, 2022:

+200 bps 3.5% (increase in net interest income)
+100 bps 1.8%
-100 bps -1.8%
-200 bps -5.8%

December 31, 2021:

+200 bps 22.9%
+100 bps 10.9%
-100 bps -6.4%
-200 bps -8.6%

So yeah, as of 12/31/2021, they thought they'd make money hand over fist if interest rates went up. But not so at 12/31/2022, at least according to their net interest income simulation.

At least part of the reason for this was that their non-interest bearing demand deposits "only" increased from 99 billion at 12/31/2021 to 110 billion at 12/31/2022, while interest bearing deposits and borrowings increased much more, from 50 billion to 87 billion. When uninsured depositors started pulling demand deposits, I imagine they were toast, in terms of their ability to make money, given their large portfolio of longer duration (4.5 year average), lower-yielding (1.6% average) treasury and and government backed securities, which was substantially larger than their loan portfolio. Even if he bank run hadn't occurred at the speed of light, and if they'd gotten higher-cost funds from the FHLB, Fed, and the issuance of bonds and preferred stock to replace demand deposits, they were going to lose money. So much for their ability to prosper with higher interest rates.

TC was right about the hedging btw. They only decreased the average effective duration of the securities portfolio by 0.1 years through rate swaps. I don't even see hedging gains or losses on their income statement, but I didn't look very hard.

Originally Posted by lustylad

In SVB's case, a whopping 97% of deposits were over $250k and thus uninsured.

That is just wild.

[Tiny]

Originally Posted by Why_Yes_I_Do

All of your above is true and accurate, yet "contagion" and "fear" apply to both when one decides to "panic" into "reckless" change for perceived "security" by giving up their "Liberty" by abandoning common sense, because of Fear-Porn.


Maybe read the extended track version above: Deposit Insurance And Cheap Money - The Ultimate Financial Bad Guys Plus the graphs are both informative and pretty compelling.

I admire Stockman. And I like Rockwell. I don't know him but spoke on the phone with him once. These two gentlemen, both great Libertarians, from time to time ignore reality in pursuit of ideological purity. And that's what Stockman is doing here.

I've looked at financial statements of several banks besides SVB, Signature and Silvergate that are caught up in this. Despite steep falls in the value of their shares and bonds, they would fundamentally be healthy if not for depositors withdrawing their money. So, I believe Stockman is dead wrong when he says SVB and Signature Bank "are only the tip of the iceberg."

It makes no sense for small businessmen or anyone else to have to become or hire bank analysts to judge whether their bank accounts, with balances in excess of $250,000, are safe. Government regulation should ensure that banks don't often fail, and when they do, the banks should, through FDIC insurance, pay to make depositors whole.

Stockman's claim that FDIC insurance is a tax is ridiculous. Again, it's bank customers and shareholders who bear the cost, and that's the way it should be.

Stockman claims that Washington bailed out $9 trillion in uninsured deposits and that was nothing less than a gift to the undeserving. That's unmitigated bull shit. What's he proposing? That we let panic reign? Start jerking our money, in excess of $250,000, out of banks and put it in in crypto and gold? Or maybe just leave the four or five biggest banks left standing, which are "too big to fail?" What does he think is going to happen when credit dries up? When the small and regional banks close?

I agree with Stockman about SVB and Signature Bank. They deserved to be shut down. And I largely agree with what he has to say about the Fed and inflation and interest rates. However, in Stockman's ideal world, where the Fed aggressively raises rates from this point forward AND also where the law of the jungle prevails in banking, there would be hell to pay.

[Why_Yes_I_Do]

Originally Posted by Tiny

I...they would fundamentally be healthy if not for depositors withdrawing their money...

Ahhh, the Greta Thundberg admonishment: How dare you withdraw your own money. Not so sure that holds water any better than a screen door might.

Originally Posted by Tiny

...So, I believe Stockman is dead wrong when he says SVB and Signature Bank "are only the tip of the iceberg....

Maybe check in on Charles Payne today: “These Folks Are Talking Armageddon… A Trifecta of Macro Imbalances!” – Charles Payne Reacts to SHOCKING Economic Numbers for some Gloom-n-Doom forecasting.

Originally Posted by Tiny

...It makes no sense for small businessmen or anyone else to have to become or hire bank analysts to judge whether their bank accounts, with balances in excess of $250,000, are safe..

I dunno, but Granny might say; If ya put all your eggs in one basket, you best be watching that basket like a hawk..

Originally Posted by Tiny

...Stockman's claim that FDIC insurance is a tax is ridiculous. Again, it's bank customers and shareholders who bear the cost, and that's the way it should be..

Right. That's why they called it a "fee". Though why they think the fee don't roll down hill remains a physics phenomenon..

Originally Posted by Tiny

...I agree with Stockman about SVB and Signature Bank. They deserved to be shut down...

Yet eerily silent on Credit Suisse going down. A freak'n Swiss bank having "material structure" challenges?!? Come on Man! That is not how the Swiss operate. Ever! They just don't wing-it...

[The_Waco_Kid]

Originally Posted by VitaMan

You are the one who replied to my post with the pejorative "Got it ?".

The stampede caused the bank failure.

As to what caused the stampede...that is open for discussion and it looks like you are discussing it at length very well.

TC is correct that SVB's liquidity crisis is in large part the recent big interest rate hikes that left many of their long term investments worth less than the principle value. let's also not forget SVB had crypto assets that took a big drop in value due to FTX's collapse. in theory if SVB had acted quickly and unloaded this crypto even at a loss on investment that might have been enough cash on demand to survive a run.

Originally Posted by Why_Yes_I_Do

Ahhh, the Greta Thundberg admonishment: How dare you withdraw your own money. Not so sure that holds water any better than a screen door might.Maybe check in on Charles Payne today: “These Folks Are Talking Armageddon… A Trifecta of Macro Imbalances!” – Charles Payne Reacts to SHOCKING Economic Numbers for some Gloom-n-Doom forecasting.I dunno, but Granny might say; If ya put all your eggs in one basket, you best be watching that basket like a hawk.. Right. That's why they called it a "fee". Though why they think the fee don't roll down hill remains a physics phenomenon..

Yet eerily silent on Credit Suisse going down. A freak'n Swiss bank having "material structure" challenges?!? Come on Man! That is not how the Swiss operate. Ever! They just don't wing-it...

Credit Suisse has had financial issues for years from plain bad investments to legal scandals and crimes. USB has already agreed at the behest of the Swiss Government to acquire Credit Suisse. most experts are only shocked it took this long (right conditions) for USB to jump in and take Credit Suisse over.