Is Credit Suisse the Next Lehman Brothers?

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 4 October 2022

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

This episode is sponsored by Nexo.io, Circle and FTX US. After a wild weekend of speculation and discussion, NLW breaks down what’s actually happening with beleaguered Credit Suisse, as well as why the FinTwit doom machine seems so focused on it. - Nexo Pro allows you to trade on the spot and futures markets with a 50% discount on fees. You always get the best possible prices from all the available liquidity sources and can earn interest or borrow funds as you wait for your next trade. Get started today on pro.nexo.io. - FTX US is the safe, regulated way to buy Bitcoin, ETH, SOL and other digital assets. Trade crypto with up to 85% lower fees than top competitors and trade ETH and SOL NFTs with no gas fees and subsidized gas on withdrawals. Sign up at FTX.US today. - I.D.E.A.S. 2022 by CoinDesk facilitates capital flow and market growth by connecting the digital economy with traditional finance through the presenter’s mainstage, capital allocation meeting rooms and sponsor expo floor. Use code BREAKDOWN20 for 20% off the General Pass. Learn more and register at coindesk.com/ideas. - “The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with editing by Rob Mitchell and research by Scott Hill. Jared Schwartz is our executive producer and our theme music is “Countdown” by Neon Beach. Music behind our sponsors today is “The Now” by Aaron Sprinkle and “The Life We Had” by Moments. Image credit: Dan Kitwood/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.3	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:15.0	The breakdown is sponsored by nexo.io, circle, and FtX, and produced and distributed by CoinDesk.
0:22.8	What's going on, guys? It is Monday, October 3rd, and today we are talking about credit
0:28.0	Suisse. Before we dive into that, however, if you are enjoying the breakdown, please go
0:32.2	subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the
0:35.9	conversation, come join us in the Breakers Discord. You can find a link in the show notes or go to bit.ly slash breakdown pod.
0:43.0	All right, folks, well, listen, this weekend, we were gone at a wedding and I was basically
0:48.3	completely off Twitter. But even through that, it was impossible not to notice everyone on FinTwit screaming about
0:56.7	Credit Suisse. So today we're going to look at what the hell was actually going on and what it
1:01.8	means for markets in the broader economy. Early on Saturday morning, ABC Australia, the state
1:06.9	news company, published an article about the crisis in the UK bond market and potential
1:11.1	systemic weaknesses in the global financial system. This was, to be clear, a fairly standard article,
1:16.3	similar to 100 others from last week. What sparked the subsequent panic was the accompanying
1:20.8	tweet from the reporter, seemingly based on an anonymous quote and narrative angle that didn't
1:25.1	make it into the article itself. Quote, credible source tells me a major international investment bank is on the brink. By Saturday afternoon,
1:33.5	the FinTwit Doomachine was in full swing, pushing the narrative through news aggregators as
1:38.0	credible source as a major international investment bank on the brink, ABC Australia. In other words,
1:43.7	making it seem that the National News Service
1:45.5	had lent credibility to the quote. Although no bank had been named at that point, the online
1:50.1	consensus immediately jumped to the conclusion that Credit Suisse was the bank in question.
1:54.7	As the story developed, reporting by Reuters the previous day resurfaced to give additional
	...

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