MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING MARCH 20, 2023 ©
March 17, 2023
REVIEW AND PREVIEW
U.S. stocks and bond yields fell as investors remained on edge even after big banks attempted a rescue of First Republic Bank. The Dow closed down more than 380 points. Despite Friday’s losses, the S&P 500 and Nasdaq gained for the week. – “Stocks Decline Broadly After First Republic Cuts Dividend,” Wall Street Journal Online, March 17, 2023.
Janet Yellen offered more assurances Thursday that U.S. banks are safe and sound—and we doubt even the Treasury Secretary believes it. Certainly no one else does. The biggest American banks had to commit $30 billion on Thursday to rescue First Republic Bank—15 years to the day since Bear Stearns’s collapse. Happy anniversary! – The Editorial Board, “While Yellen Assures, Banks Run, March 16, 2023.
Banking woes and rescue efforts dominated financial news events last week, consistent with Venus square Pluto in the last degrees of Aries and Capricorn (crisis), followed by Venus then ingressing into Taurus (the rescue and recovery), as Venus rules Taurus, the money sign. And now we have a conflict between our view that this is likely an over-reaction per the current geocosmic landscape containing an abundance of Neptune and Pisces signatures (illusion, hysteria, lack of facts), versus the analysis of respected media sources like the Wall Street Journal.
MMA FREE WEEKLY COLUMN FOR THE WEEK BEGINNING MARCH 13, 2023 ©
March 10, 2023
REVIEW AND PREVIEW
“The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated,” Powell said in remarks prepared for delivery before the Senate Banking Committee. “If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes.” – Megan Henney, “Fed Chair Powell Says Interest Rates are ‘Likely to be Higher’ Than Previously Expected,” March 7, 2023, www.foxbusiness.com.
Financial regulators have closed Silicon Valley Bank and taken control of its deposits, the Federal Deposit Insurance Corp. announced Friday, in what is the largest U.S. bank failure since the global financial crisis more than a decade ago. The collapse of SVB, a key player in the tech and venture capital community, leaves companies and wealthy individuals largely unsure of what will happen to their money. – Jesse Pound, “Silicon Valley Bank is Shut Down by Regulators in Biggest Bank Failure Since Global Financial Crisis,” March 10, 2023, www.cnbc.com.
The U.S. stock market did not take kindly to Powell’s comments that the economy is still too strong, and thus interest rates need to remain high and maybe go higher. He also acknowledged in a testy exchange with Senator Elizabeth Warren that this policy might lead to a recession. And then, on Friday, Silicon Valley Bank was shut down by banking regulators. On these news events, U.S. equity markets plummeted, dashing bullish hopes after exhibiting rather strong bullish triggers on the previous week’s close. Continue reading…