3/13/2023: Banks Go Bust
3/13/2023: Banks Go Bust
PLUS: Biden’s Budget Blunder; Oscars Recap; and A New Duke
Today is Monday, March 13, 2023.
It is the 72nd day of the year.
293 days remain.
WHAT’S ON TAP
The second-and-third biggest bank failures in history in the last 72 hours. We’ve got the goods in HIT LIST.
Some more details about the budget President JOE BIDEN laid out last week in THE SWAMP.
JANE FONDA has murder on her mind and SETH ROGAN is successful without kids. More in SHOWBIZ.
KRISTEN DOUTE is returning to “Vanderpump Rules” and “The Flintstones” spin off has landed at FOX. More in CASTING CALL.
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HIT LIST
In the last three days, state regulators on opposite coasts closed two banks – making for the second-and-third-biggest bank shutdowns in history in terms of total value of their assets.
IN CALIFORNIA: State regulators shuttered SILICON VALLEY BANK – or SVB for short – after a run on deposits last week.
SVB had amassed billions of dollars in bonds as part of their investment portfolio and used accounting tricks to overstate the value of their assets relative to their liabilities. But the recent rapid rise in interest rates caused the value of these bonds to decrease dramatically. This means that, on paper, the value of SVB’s assets decreased significantly. By law, banks must have a certain multiple of assets to outweigh their liabilities. As the value of their assets decreased as the value of their bonds decreased, SVB needed to raise more money.
IT GETS WORSE: One of the draws to SVB was the high interest rate it paid to depositors, which the bank paid for by investing more customer deposits than would be typical for a bank. Ultimately, as bond yields decreased and withdrawals increased, the bank was paying out more in interest than it was generating from bond yields.
Last week, SVB announced they sold off $21 billion in securities at a loss in order to have the cash to make good on an increasing number of customer withdrawals and maintain regulatory compliance. To cover that loss, they wanted to raise money from investors.
BUT WAIT: The selloff and ask for cash spooked venture capitalists and the companies that kept money at the bank, so they started withdrawing their cash faster and faster. The economic downturn has dried up investor cash, so these companies began relying on their retained earnings and existing capital to keep paying the bills.
On Friday morning, California’s Department of Financial Protection and Innovation took control of the bank and appointed the Federal Deposit Insurance Corporation to oversee its sale. With $209 billion in assets at the end of last year, SVB’s collapse makes it the second biggest bank failure ever.
On Sunday, the government announced it would insure all customer deposits – even those beyond the Federal Deposit Insurance Corporation’s $250,000 limit.
WORTH NOTING: The FDIC does not directly use taxpayer funds in a situation like this, so this isn’t a direct bailout. The shareholders at these banks will go bust. The FDIC operates by using fees paid by banks in a situation like this, and will likely increase these fees amid increasing economic uncertainty – fees that will get passed along to depositors.
Paying these fees will be a minor inconvenience for the big players – JP Morgan, Wells Fargo, Bank of America, to name a few – smaller, local banks may struggle, leading to the exact kind of financial consolidation that leaves people with fewer options.
WORTH NOTING: This also sends another, increasingly dangerous signal: that Big Government will be there whenever something goes sideways in the private sector.
MEANWHILE, IN NEW YORK: State regulators closed Signature Bank, a favorite of crypto companies. Regulators are backing deposits at Signature like they are at SVB.
BY THE WAY: SVB’s Chief Administrative Officer was the CFO of Lehman Brothers in 2008 – which was the fourth largest investment bank in the world until it collapsed in the 2008 recession.
MEANWHILE: When one Twitter user suggested Twitter buy SVB to become a digital bank, ELON MUSK replied, “I’m open to the idea.” Musk has said on multiple occasions he sees Twitter facilitating online transactions in the digital creator economy, and such a purchase could provide much of that infrastructure.
FUN FACT: Last year, Bloomberg reported that Milwaukee Bucks great GIANNIS ANTETOKOUNMPO intentionally divided up his cash across more than 50 banks, never leaving more than $250,000 in each, so that his funds were insured by the FDIC.
[via CNN, Bloomberg, Fidelity, MarketWatch, CNBC, RationalWalk]
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The judge overseeing SAM BANKMAN-FRIED’s trial told attorneys on Friday that he’s skeptical of efforts to limit SBF’s access to the internet.
SBF’s attorneys have asked for leniency on the judge’s demand that SBF not even touch a device connected to the internet. They’ve argued their client needs to at least manage legal documents, do his own research, and access some sports and streaming sites.
But the judge says about SBF, “I suspect he’s very inventive and technologically savvy he could find a way around it and conceivably not get caught.” He then ordered the attorneys to amend their request. [via CNN]
MEANWHILE, WHEREVER SHAQ IS HANGING OUT: SHAQUILLE O’NEAL was named as one of the defendants in the class action lawsuit against FTX and its celebrity endorsers – but so far no one has been able to find the NBA legend to serve him papers.
Lawyers for the plaintiff say the allegations against Shaq are some of the most consequential. [via NYPost]
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North Korea successfully launched a missile from a submarine over the weekend, ahead of scheduled joint military exercises between the US and South Korea.
The missiles have significant technical capability for the Hermit Kingdom – they were reportedly airborne for two hours, flying in a figure-eight pattern, before impating targets nearly 1,000 miles away.
This was the first time North Korea managed to launch a long-range missile from underwater. [via Associated Press]
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NASA’s SpaceX Crew 5 is back on Earth after a splashing down over the weekend.
The astronauts spent nearly six months aboard the International Space Station.
MEANWHILE: NASA and Canada’s space agency will announce on April 3 the crew for the next Artemis mission, which will take the astronauts around the Moon. The crew will include three Americans and one Canadian.
Boots will return to the Moon no earlier than 2025. [via Gizmodo]
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Walmart will begin carrying ranch-flavored ice cream made by Van Leeuwen and Hidden Valley in many stores across the country.
The creative confection will his tores on March 20. [via Entrepreneur]
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A Colorado woman says serving on jury duty saved her life!
Last month, Shirley Bennet stepped out into a hallway during a trial break, took a seat on the bench – and that’s the last thing she remembers. She was suffering a major heart attack, and because trained officials were on site, they were able to give her CPR until paramedics arrived.
The 69-year-old juror says that were she not serving on jury duty, she likely would’ve died at home. [via 9News]
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CHARTS
Weekend Box Office
10. Operation Fortune: Ruse de guerre: $1.3 million (down from 7)
9. Puss in Boots: The Last Wish: $1.6 million (down from 8)
8. Avatar: The Way of Water: $2.7 million (down from 6)
7. Champions: $5.1 million (new)
6. Jesus Revolution: $5.1 million (down from 5)
5. Cocaine Bear: $6.2 million (down from 3)
4. Ant-Man and the Wasp: Quantumania: $7 million (down from 2)
3. 65: $12.3 million (new)
2. Creed III: $27.1 million (down from 1)
1. Scream VI: $44.5 million (new)
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DEATHS
Actor ROBERT BLAKE has died.
He passed away Thursday from heart disease, according to a statement from his niece.
Over his 50-year career, Blake starred in several films, including “Lost Highway,” “In Cold Blood” and “Treasure of the Sierra Madre.” In the early 2000s, he was charged with the murder of his second wife, but was ultimately found not guilty.
He was 89.
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Former Vikings head coach BUD GRANT has died.
He passed away Saturday, according to a statement from the team. No cause of death was shared.
Grant led the team to 10 Central Division titles and four Super Bowl appearances in his 18 year career.
He was 95.
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Rapper COSTA TITCH, real name Costa Tsobanoglou, has died.
He passed away after collapsing during his performance at the Ultra South Africa festival in Johannesburg on Saturday. A cause of death is not yet known.
Costa was 28.
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KISKA, the world’s loneliest orca whale, has died.
Her death was announced Friday by Marineland in Niagara Falls, Ontario, where she lived for the last several decades.
During her time in captivity, Kiska gave birth to five calves who all tragically passed away, leaving her to live in solitude. She was given the sad nickname of lonelist orca, as isolation is considered torture for the social mammals.
She was 47-years-old.
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RELATIONSHIPS
Actress CHRISTINA HENDRICKS, 47, and camera operator GEORGE BIANCHINI, 54, are engaged!
“We proposed to each other and we said yes!!!,” the “Mad Men” actress captioned a photo of the couple on Friday.
The pair met while working on NBC’s “Good Girls.”
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THE SWAMP
REMEMBER WHEN last week, President JOE BIDEN said his budget plan would decrease the deficit by $3 trillion over the next decade? And it was really a creative way of saying, We’re still going to add $17 trillion to the debt over the next decade?
Under Biden’s own plan, according to his own numbers, the 2024 deficit would be $1.8 trillion.
The 2033 deficit would be $2.035 trillion – an increase in the annual deficit.
WORTH ASKING: These numbers are part of a published plan by the Biden White House. Are they lying? Do they think you’re just stupid? Are they just stupid?
WORTH NOTING: Just to be dramatically clear, these numbers aren’t based on some right-wing, anti-Biden Think Tank’s analysis. They’re published as part of the White House’s official budget, which they posted online and you can read here >
[h/t @jamiedupree]
BY THE NUMBERS
📈 The DOW lost 345 points (1.07%) to close at 31,909 on Friday. The S&P lost 56 points (1.45%) to close at 3,861 and the NASDAQ lost 199 points (1.76%) to close at 11,138.
🛢 WEST TEXAS INTERMEDIATE closed at $76; BRENT CRUDE at $82.
⛽ The national average price of a GALLON OF GAS was $3.47 on Sunday.
₿ BITCOIN rallied over the weekend, adding more than 7% on Sunday and trading over $22,500. When there’s bad news for banks holding fiat currency, it’s usually a good day for alternative currencies. Other cryptocurrencies, like DOGECOIN and ETHEREUM were both up over 4%.
🛩 There were more than 5,840 FLIGHTS delayed within, into, or out of the United States on Sunday and more than 235 such cancellations.
💰Tuesday night’s MEGA MILLIONS drawing will be for a $229 million jackpot or a $120.6 million cash payout. Tonight’s POWERBALL drawing will be for a $52 million jackpot or a $27.4 million cash payout.
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SHOWBIZ NEWS
“Everything Everywhere All at Once” won 7 of its 11 Oscar nominations last night, including Best Picture, Directing, Editing, and three of the four acting awards.
“All Quiet on the Western Front” won four.
Here’s the full list of winners from last night’s Academy Awards:
Full list of winners:
Picture - “Everything Everywhere All at Once”
Director - Daniel Kwan & Daniel Scheinert, “Everything Everywhere All at Once”
Actress - Michelle Yeoh, “Everything Everywhere All at Once”
Actor - Brendan Fraser, “The Whale”
Supporting Actor - Ke Huy Quan, “Everything Everywhere All at Once”
Supporting Actress - Jamie Lee Curtis, “Everything Everywhere All at Once”
Original Screenplay - Daniel Kwan & Daniel Scheinert, “Everything Everywhere All at Once”
Editing - “Everything Everywhere All at Once”
Sound - “Top Gun: Maverick”
Song - “Naatu Naatu” from “RRR”
Adapted Screenplay - Sarah Polley, “Women Talking”
Cinematography - “All Quiet on the Western Front”
Original Score - “All Quiet on the Western Front”
Visual Effects - “Avatar: The Way of Water”
Production Design - “All Quiet on the Western Front”
Animated Feature - “Guillermo del Toro’s Pinocchio”
Animated Short - “The Boy, The Mole, The Fox, and The Horse”
Documentary Feature - “Navalny”
Documentary Short - “The Elephant Whisperers”
Live Action Short - “An Irish Goodbye”
Makeup & Hair - “The Whale”
Costume Design - “Black Panther: Wakanda Forever”
International Feature - “All Quiet on the Western Front”
Odds & Ends:
During the official ABC pre-show, HUGH GRANT gave one of the least helpful interviews ever witnessed. Watch it here >
LADY GAGA got out of her dress, took off her makeup, and put on a plain black t-shirt before taking the stage to sing “Hold My Hand,” one of the songs nominated for best original song. ALSO: Before heading into the awards show, she hustled to help up a photographer who had tripped.
The jokes and tone were much less political than in recent years, save for one January 6 protest jab.
During a bit where host JIMMY KIMMEL did a Q&A with some of the stars in the audience, JESSICA CHASTAIN had to take off a mask in order to talk into the microphone; she appeared to be the only one still in a mask.
MEANWHILE, AT THE RAZZIES: The Golden Raspberry Awards identify the worst films of the year. And the losers are:
Worst Movie - “Blonde”
Worst Actor - Jared Leto, “Morbius”
Worst Supporting Actor - Tom Hanks, “Elvis”
Worst Supporting Actress - Adria Arjona, “Morbius”
WORTH NOTING: They Razzies organization nixed the Worst Actress category this year, after catching flack for nominating a 12-year-old for the shameful prize. Instead, they awarded the Razzy to themselves for the worst blunder of the year.
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JANE FONDA shared her violent thoughts on the overturning of Roe v. Wade during Friday’s episode of “The View.”
“We’re not going back. I don’t care what the laws are! We’re not going back,” she exclaimed, to which co-host SUNNY HOSTIN asked, “Besides marching and protesting, what else do you suggest?”
“Murder,” Fonda replied.
When asked about her comment later on, Fonda said that it was “made in jest,” saying she was “using hyperbole to make a point.” [via Decider]
WORTH ASKING: For those watching, who may have taken what Fonda said to heart, should she be held responsible for planting the idea?
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RUSSELL WILSON and CIARA visited the Everglades Correctional Institution in Florida last week to pray with the over 300 inmates incarcerated there.
The NFL QB read from the Bible while his wife sang to the crowd.
The visit was facilitated by the group God Behind Bars. [via TMZ]
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IDRIS ELBA has a long list of acting roles he has taken on over the years, but he says one role in particular stands out as the most difficult.
“My hardest role ever,” he told ET Canada, “was being People’s Sexiest Man Alive.”
The actor was bestowed the title in 2018. [via People]
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SETH ROGAN said he and his wife LAUREN MILLER ROGAN’s decision not to have children has “helped [him] succeed” in his acting career.
Speaking on the “Diary of a CEO” podcast, the actor opened up about how having kids was never on the table for the couple, and has allowed them to have the freedom to do whatever they want.
“Honestly, the older we get, the more happy and reaffirmed we are with our choice to not have kids,” Rogan added.
The pair are not total empty nesters however, they have Zelda, a Cavalier King Charles Spaniel. [via Page Six]
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BLAC CHYNA has deleted her OnlyFans account, despite making $240 million on the platform in 2021.
The 34-year-old mom-of-two said she gave up on the subscription-based streaming service, because it’s a “dead end” gig during a recent appearance on the “Jason Lee Show.”
Chyna also explained that she is trying to set a better example for her two kids, son KING CAIRO, 10, whom she shares with rapper TYGA and daughter DREAM KARDASHIAN, 6, whom she shares with ROB KARDASHIAN.
Even with her decision to exit the platform, she said that she applauds those who are out there making it work. [via NY Post]
FOR THE RECORD: That $240 million number is an estimate by online research company Statista. Full report here >
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CASTING CALL
KRISTEN DOUTE is returning to “Vanderpump Rules” for Season 10.
Doute was fired from the Bravo show in 2020 over a racist prank against former co-star FAITH STOWERS.
Her return was announced as current (and former) cast members continue to react the “Scandoval” aka the affair between TOM SANDOVAL and RAQUEL LEVISS. [via Deadline]
WORTH NOTING: Doute used to date Sandoval, who cheated on her with ARIANA MADIX. For the past nine years, Sandoval and Madix appeared to be the perfect couple, until news of the affair broke. Sandoval has allegedly been cheating on Madix for over eight months with Leviss.
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ELIZABETH BANKS will voice 20-something Pebbles, the adult daughter of Fred and Wilma in “The Flintstones” spinoff series, “Bedrock.”
The animated adult comedy series catches up with the Stone Age family two decades after the end of “The Flintstones,” with Fred on the brink of retirement and Pebbles embarking on her own career.
Banks is also serving as executive producer.
“Bedrock,” set to air on FOX, does not yet have a premiere date. [via Deadline]
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JENNA ORTEGA is in talks to star in Warner Bros’ upcoming “Beetlejuice” sequel.
If the rumors are true, she will play the daughter of WINONA RYDER’s Lydia, who starred in the original 1988 film.
The role would reunite Ortega with TIM BURTON, who directed her in Netflix’s “Wednesday.”
MICHEAL KEATON is also expected to reprise his role as Beetlejuice in the movie. [via The Hollywood Reporter]
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MTV announced over the weekend that SAMMI “Sweetheart” GIANCOLA is returning to “Jersey Shore.”
It’s been over a decade since Sammi appeared on the show, alongside castmates MIKE “The Situation” SORRENTINO, JENNI “JWoww” FARLEY, NICOLE “Snooki” POLIZZI, PAULY “DJ Pauly D” DelVecchio, ANGELINA PIVARNICK, VINNY GUADAGNINO, RONNIE ORTIZ-MAGRO and DEENA NICOLE CORTESE.
The original show ran from 2009 to 2012 and was rebooted in 2018 as “Jersey Shore: Family Vacation.”
The show airs Thursdays on MTV. [via US Weekly]
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CRIB NOTES
SIEGFRIED and ROY’s former Las Vegas home has sold for $3 million.
Sources told TMZ that the “Jungle Palace” has been purchased by BRETT CARDEN, owner of the Carden International Circus, and his father. They have plans to possibly turn the property into a tourist attraction or short-term vacation rental.
As previously reported, Siegfried and Roy lived in the home with the big cats they worked with in their iconic Vegas shows. [via TMZ]
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THE DAILY KARDASHOPUS
KRIS JENNER has a cameo role in the music video for MEGHAN TRAINOR’s new song, “Mother.”
In the video, the 67-year-old wears a custom white Cult Gaia gown with puffy sleeves and matching gloves, which she pairs with long sparkly earrings and a matching statement necklace. Jenner also shows off a platinum blond pixie cut.
Jenner’s kids were in full support of her cameo appearance, with KHLOE KARDASHIAN commenting, “Oh my god. I’m screaming!!! Mom, I love you!!” and KIM KARDASHIAN wrote, “Isn’t my mom the cutest?” [via Page Six]
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KHLOE KARDASHIAN and TRISTAN THOMPSON are so good at co-parenting that they were spotted hanging out without their kids.
The two stopped at Nice Guy in West Hollywood on Friday, where they celebrated Kardashian’s best friend, MALIKA HAQQ’s 40th birthday.
KIM KARDASHIAN, KYLIE JENNER and their mom, KRIS JENNER were also in attendance at the shindig. [via Page Six]
Let the reconciliation rumor mill continue to spin.
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WE’LL NEVER BE ROYALS
KING CHARLES granted his younger brother PRINCE EDWARD the title of Duke of Edinburgh on Friday -- which was also his 59th birthday.
The new title means Edward’s wife, SOPHIE RHYS-JONES, is now the Duchess of Edinburgh and his son, James, will take over the Earl of Wessex title.
The Duke of Edinburgh title was created for PRINCE PHILIP in 1947 when he married QUEEN ELIZABETH, who was the Duchess of Edinburgh before ascending the throne in 1952, according to a statement from Buckingham Palace.
Prior to his passing, Philip stated that he wanted the title to go to Edward.
ALSO: Last week MEGHAN MARKLE and PRINCE HARRY’s kids ARCHIE and LILIBET had their titles updated on the Royal Family’s website, naming them Prince Archie and Princess Lilibet. Harry and Meg called the titles their “children’s birthright” in a statement to Page Six. [via Page Six]
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PRINCE ANDREW is reportedly “in despair” after not inheriting any money from his mom, QUEEN ELIZABETH after her passing.
According to The Sun, Elizabeth’s estate -- about $782 million -- was given to KING CHARLES. The reasoning being that if the money is given “monarch to monarch,” Charles would not have to pay taxes on it.
That means, however, that PRINCESS ANNE, PRINCE EDWARD, and of course, Andrew, have not received any of the funds, even though the former two are still working royals.
“He’s a member of the family, for God’s sake,” a friend of Andrew told the outlet.
Reports of Andrew’s “despair” come just days after The Sun posted a story about how Charles denied his younger brother’s request to pay $38,000 for a live-in Indian guru. The guru reportedly helps treat Andrew with chants, massages and holistic therapy. [via The Sun]
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DAY OF THE YEAR
National Open An Umbrella Indoors Day
Commonwealth Day
National Jewel Day
Fill Our Staplers Day
National Coconut Torte Day
Ken Day
National Earmuff Day
Smart & Sexy Day
Universal Women’s Week
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ON THIS DATE
1781 – European astronomer William Hershel discovers Uranus.
It became identified as the seventh planet from the sun and the first discovery of a new planet in centuries.
It was also the first to be found using a telescope. Earlier astronomers believed it to be a star.
Voyager 2 was the first spacecraft to fly by it in 1986, when it also identified ten new moons and rings around the planet.
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1809 - A military-led coup removes King Gustav IV Adolf of Sweden from his throne, following a disastrous loss of the country’s territory to Russia.
The revolutionaries let Gustav’s uncle, Duke Charles, take charge of an interim government while the Royal Family was imprisoned in a castle. A few weeks later Gustav abdicated, leading the way for his uncle to become King Charles XIII of Sweden and oversee a new constitution.
Gustav IV lived in exile for the rest of his life, though he was ultimately buried at a monastery near Stockholm.
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1868 - The first presidential impeachment trial begins, with Andrew Johnson fighting accusations of violating the Tenure of Office Act when he dismissed Edwin M. Stanton from his cabinet seat.
Contemporary accounts described the trial as pure theatrics -- a political show to make a political point.
In May that year, a majority of senators voted to remove Johnson from office, but fell short of the two-thirds majority for removal by just one vote.
In 1926, the Tenure of Office Act was declared unconstitutional.
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2005 – Robert Iger takes over at Disney.
He succeeds Michael Eisner and is hoped to breathe new life and vigor into the company. Disney had struggled to keep up with creative powerhouse Pixar, which had recently produced the family blockbuster, “Finding Nemo.”
Since Disney owns ABC, Iger became the first big-four network head to agree to sell its TV shows on the iTunes store.
He was also instrumental in coordinating the purchase of Lucasfilm by Disney in 2012.
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2019 – The U.S. grounds all Boeing 737 Max aircraft after the second crash in Ethiopia.
China was the first to ground the MAX, with other countries following in quick succession.
By March 18, all 387 airplanes were grounded, disrupting 8,600 weekly flights by 59 different airlines.
In April, Boeing admitted that the new Maneuvering Characteristics Augmentation System (MCAS) played a role in both crashes.
Boeing’s CEO would be ousted in December over mismanagement of the crisis.
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2020 - The US government officially declares the Covid-19 pandemic a national emergency.
In a matter of days, from coast to coast, businesses closed, schools sent kids home, and millions of people lost their jobs.
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BIRTHDAYS
Coco Gauff - tennis player - 19
Jack Harlow - rapper - 25
Mikaela Shiffrin - Olympic skier - 28
Ozuna - reggaeton singer - 31
Kaya Scodelario - actress, “Skins” & “The Maze Runner” - 31
Lucy Fry - actress, “Lightning Point” & “Vampire Academy” - 31
Tristan Thompson - basketball player - 32
Harry Melling - actor, “Harry Potter” films - 34
Emile Hirsch - actor, “Into the Wild” & “Speed Racer” - 38
Noel Fisher - actor, “Shameless” & “Teenage Mutant Ninja Turtles” - 39
Danny Masterson - actor, “That ‘70s Show” - 47
David Draiman - metal singer, Disturbed - 50
Leigh-Allyn Baker - actress, “Good Luck Charlie” & “Bad Hair Day” - 51
Common - rapper - 51
Adam Clayton - bassist, U2 - 63
Kathy Hilton - fashion designer & actress; mom of Paris - 64
William H. Macy - actor, “Shameless’ & “Pleasantville” - 73
Born On This Date
Joe Ranft - screenwriter & animator, “Toy Story” & “Cars” - 1960 (d. 2005)
L. Ron Hubbard - founder of Scientology - 1911 (d. 1986)
Juan Rodriguez Cabrillo - conquistador who discovered California - 1499 (d. 1543)
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