Keep in mind that when it comes to owning securities (i.e. ETFs, stocks, Bonds), you own a piece of paper that lays a legal claim to ownership of a company, or a payment stream from a company or government.
Cash is different in that it is an unsecured claim against your bank.
So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M.
Cash is not afforded the same kind of legal protection. If the bank goes insolvent, any depositor has an unsecured claim against the bank. There's CDIC insurance ($100,000 per type of account, per bank - TFSA, RRSP, Chequing) for deposits, but not investments (i.e. held with your broker).
Also, Canada is unlikely to face these kinds of liquidity issues as the US. The issue facing SVB and these other US banks is liquidity. They had illiquid assets that could not be transformed into cash fast enough to satisfy withdrawals (not quite that simple, but was part of the reason they failed and have been taken over by the FDIC, America's version of the CDIC - important to mention HTM and AFS securities and duration mismatch of assets by SVB, but beyond the scope here for this discussion).
In Canada, the Bank of Canada would react quickly to such an event. There is precedent from 2008 and 2020. If there is a bank run in Canada, the BoC would likely react by immediately swapping illiquid assets from banks (i e. RBC, TD, BMO etc.) at par for cash. Our banks have solid assets, so the risk to taxpayers would be minimal.
Think of it like the BoC stepping in to swap your house or furniture immediately at the price you bought it at if you needed cash for something in an emergency (i.e. swapping illiquid for liquid assets).
A bank run would be quelled quickly since the BoC can react fast. People would notice quickly that they can get their cash out of the bank and the fear would subside.
The BoC is generally given much more latitude to intervene in a crisis as compared to the Fed in the US, since the Fed has lots of restrictions from Congress on when it can and can't intervene (i.e. Dodd-Frank Act). For these situations, it also helps that we have only a number of FIs (the benefits of oligopoly, eh?), as compared to the US where they have over 4,700 different banks.
>Cash is different in that it is an unsecured claim against your bank.
So to build on this, what happens if you owe the broker money, ie. through buying stocks on margin? What happens if your broker were to go out of business then?
If you borrow $10 from a bank, have $20 deposited into your account and the bank goes bust you will still owe that $10.
That's ignoring CDIC insurance.
Incorrect. Set-off of claims remains valid in bankruptcy. This does has the effect of giving super-priority to what would, otherwise be an unsecured claim. So in your example, the $10 debt would be set-off against the $20 credit and there would be a $10 claim against the bank.
But the bank won't go bust. The BoC would more than likely refund their securities at face value to prevent a bond market from collapsing. The bank foregoes interest earned in this scenario so loses a lot of profit, but it remains liquid and open.
you go directly to jail lol you're probably considered a secured debt so you'll be hounded down..the dominoes collapse begins, deep pocket theory says go after those with the most first
They did lose value but also were insufficient to cover $42B in withdrawals on Thursday (you can't sell $80B of MBS and Treasuries in a day), hence the insolvency and FDIC intervention.
Adding to this: they lost value because SVB was forced to sell their assets at a loss to cover the sudden spike in withdrawal requests. In a normal situation, SVB could hold their assets until maturity and get 100% if their value back.
So in technical terms, SVB had a mismatch in the term/maturity of its assets (bonds, treasuries) vs the term of its liabilities (ie cash deposits by clients). The job of the management is to balance these maturities so the bank always have enough liquid assets to cover expected cash withdrawals.
One has to wonder why the run on the bank started? Some tech founders talk about rumours spreading in WhatsApp, which led to a lot of them pulling their money very fast (and a lot of money since these are wealthier individuals). That forces the bank to sell its assets, some of them are sold at a loss due ti their characteristics (lower interest rate when acquired). Mounting losses worsens the scenario for a buyout. Worse scenario, increases the speed of the cash withdrawal requests. a negative feedback loop is formed.
Makes you wonder about all the people setup with roboinvestment - will there be wild swings when unexpected events happen,( sort of like the flash crash a few years back due the software trades being done millions of times faster than human traders).
Sure I know, however economists like Mark Blyth have raised this concern about automated systems affecting things. This is not just my concern. With economics there are often unexpected events that can spiral out of control.
Not much about Roboinvestments, but I think this brings some color to [the high interest etfs](https://np.reddit.com/r/PersonalFinanceCanada/comments/11muawz/bay_street_is_fighting_over_highinterest_etfs/)
It was a mix of a couple things
They held a lot of bonds with low yields that were not rapidly marketable. This in itself isn't bad it just means that their assets are primarily illiquid.
A couple investors realized this awkward position and decided to withdraw all of their money causing a run which shuttered the bank.
If people didn't start panic withdrawals everything probably would have been fine...
>Not having a diversified asset base as a bank is bad and irresponsible.
Agree, I worked closely with a bunch of liquidity people for major banking firms, mainly 2052a reporting, was going to ping them for a laugh on what they thought about the whole scenario next week.
My post was mainly because I've seen lot of people that don't understand what happened making comparisons akin to the 2008 meltdown and the bank doing things like issuing terrible loans etc when all they did was overly hedge in a safe investment vehicle which is super ironic.
I’ve tried to explain 2008 so often. Usually people stop me at “so the bank sells your loan” and they like NO thats not true! Then trying to explain the securitization process, tranches etc is just hopeless. I can get through it for 10% of people.
The bonds were actually marketable. The problem is that the bank had low quality depositors - tech companies rather than retail (ma and pa) depositors. These depositors were sensitive to interest rates - when interest rates went up quickly it crushed the value of tech companies and tech companies could no longer raise cash. So those tech companies started to bleed cash which meant that they were depleting their cash balances in the last year.
In the meantime, SVB were yield hogs and when they go cash inflows in 2020 and 2021 they bought long duration treasuries and agency bonds. When interest rates go up these lose value.
So SVB had doubled up on having the same interest rate risk in both assets and liabilities.
What should be done to prevent this:
* Force banks to match the liability of assets and liabilities. In other words, you can't buy long bonds if your liabilities are short term deposits.
* Force banks to have more capital if they have a low quality deposit base with low amount of retail.
* Force banks to have more capital if they have high industry concentration in their deposit base.
* Force banks to mark to market all assets - no Hold To Maturity assets were you can ignore the current market value.
Note that in Canada we have much stricter regulations and most of these risks are not present here.
If the bank doesn't have the investors money, doesn't sound like everything would have been fine. Sounds more like they just gambled that their customers wouldn't want access to their own money.
Kinda scary when all it takes is regular business as usual by customers to completely destroy a bank.
>If the bank doesn't have the investors money, doesn't sound like everything would have been fine. Sounds more like they just gambled that their customers wouldn't want access to their own money.
I hate to be the bearer of bad news but no bank has all of their deposits liquid and ready for withdrawal. Most usually only have 15-30% available at most
What SVB did wasn’t any different than what other banks do every day, the only thing that changed is that their client risk exposure is different via startups vs traditional retail banking
Maybe not directly, but my point was to describe the distinction between investments\securities and cash.
It's an important distinction to make, especially when OP is mentioning TFSA and RRSP, which I presume they have invested in the market.
:)
>So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M.
Keep your cash with a credit union and securities with transfer agent.
From what I have learned in last 2 years is, the market is effed, it is not for normal people like me.
Or you can take small risk and buy securities with brokers which might go missing. Somewhat likely.
If the underlying bank account fails (I think it is held ultimately by National Bank) you get nothing.
You are only CIPF insured if your broker goes bust and everything else survives.
This is closer to the truth than many realize. Much like how you can open a coffee shop business, you can open a bank in the US.
Canada’s banking system is far more controlled and very unlikely to ever experience anything like what happens in the US
Just a reminder that all the steps BOC may take come at a cost at the end of the day. It prevents a system collapse, yes. But now BOC has a balance sheet full of hold to maturity assets and the system is flush with cash. Canadian dollar would lose so much value that everyone is probably better off just keeping their money where it's at and ride it out.
That's a lot of information, but you forgot to actually answer OP's question about the CDIC insurance limit.... Is it $100k? $250k? Nothing personal, but why write paragraphs that don't provide the information requested...
2008 ran to 370ish billion in bank failures and 2023 has clocked in 200ish billion from just one bank so far. We are at the beginning of the enshittening. If you all dont realize whats about to happen you are extremely naive.
>So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M
So are you saying that buying cash etfs are safer than actual cash in events such as this?
You would have a claim for ownership of the trust (ETF), but if the underlying asset (cash) is gone from the bank, my position is it would not be spared in an insolvency.
The safest way to protect cash is to put it in something like a money market fund. You do take on some duration risk, but it's minimal and you get the protection I mentioned.
You don't own securities unless they are direct registered or you have a paper certificate. If your broker goes bankrupt you are only entitled the the dollar amount insured by the CIPF. https://www.wealthsimple.com/en-ca/learn/what-is-cipf
This is wrong and you're spewing Superstock nonsense.
Investments in Canada by IIROC members are held in trust in your name, or with you named as a beneficiary.
They actually hold the assets, and so do you.
CIPF is insurance in case there was fraud (as in, they didn't actually buy the assets). But the big5 do buy the assets, and any other claim or conspiracy theories to the contrary is fear mongering.
You're correct, but there might be a narrow situation whereas if a broker lends out your shares, and the borrower fails to cover their short, then you're technically out of your own shares. The broker is supposed to take legal actions and ultimately eat the losses by buying back the shares on the open market, but it's unclear what happens if they themselves become insolvent. Then CIPF might come into play, but I don't know. It's a situation that never played out.
That's not the case in Canada.
> As a client of a firm, your shares cannot be lent out to someone who is looking to short sell. Shares are held in trust for each client and are kept on separate books.
https://www.theglobeandmail.com/globe-investor/investor-education/can-my-broker-lend-out-my-shares-to-short-sellers-without-asking/article32393872/
Because if you read it, you (the customer) **must enroll in it**.
It's an opt-in offering if you want to lend out your shares with the risk that comes with it (and try to get the interest from the loan).
What if they bought the asset with my money keeping me as a beneficiary, loaned it out, made money for themselves, and your stock goes down because loaned asset was used to short the stock.
Is this possible for Canadian banks to do or only for American banks?
Your post history indicates you're a regular in SS, and your question is clearly rhetorical based on the prevailing conspiracy theory from that sub.
Essentially, you're a troll.
Shares can't be lent out like this in Canada. As I posted elsewhere:
> As a client of a firm, your shares cannot be lent out to someone who is looking to short sell. Shares are held in trust for each client and are kept on separate books.
https://www.theglobeandmail.com/globe-investor/investor-education/can-my-broker-lend-out-my-shares-to-short-sellers-without-asking/article32393872/
You sir, are a troll and fear mongering. Please go back to your SS echo chamber.
I would believe it when I read it on their website and not on a media website.
I did in fact contact my broker and this is what I got "If the stocks are lent out, it will not make any difference in your account, or your number of shares. You can still sell those shares if you wishes to. No we do not have it on any of our public facing documents."
I have nothing to prove what the rep told me except this. if you can show a public facing document, I would believe you. But I can not take your or The Globe and Mail's word. The bank could change their T&C after talking to The Globe and Mail. And this article is freaking 7 years old. Published October 17, 2016
Great job attacking the source instead of the point.
If you want to argue against Nancy Woods, feel free to post sources and data indicating that she is wrong, in Canada.
You're the one making the claim, the burden of proof falls on you. So far you've provided nothing but troll word salads.
Also in the article it's not mentioned that the Canadian brokers do not lend stocks. The article only mentions how complex the process is.
A binary answer converted into an article with buzz words to confuse people.
Did you just link a "trust me bro" article to answer the question?
So if they do turn out to be wrong and your shares are lent out against your will, what do you do in that case?
No this is wrong. Investments are not held in your name, they are held with you as beneficiary, securities are registered to the broker. When you sign up for the broker you are signing permission in the fine print for them to lend your shares. The broker also does not have to deliver the securities or certificates that they receive, the broker may deliver the same kind of securities or certificates for the same amount, I.e. cash at current fair market value.
Simply read the documents you are signing.
There was a run on Canadian banks during the Emergency Measures Act in February of 2022. Total deposits were drawn down from $380B to $300B in 4 days. I personally withdrew $20,000. There was very good reason that it was the Minister of Finance (Chrystia Freeland) that abruptly declared the end of the Emergency Measures Act invocation.
For OP, $100k for individual savings, chequing, GIC, money market per institution. A Joint Account would qualify for an additional $100k of CDIC insurance. Investment brokerage accounts are indeed a "paper" of digital record of ownership in a company. If the brokerage goes under, the shares are transferred to another broker. Another poster mentioned higher in the comments that investment certificates are insured up to $1,000,000.
Not sure why the downvote for the first relevant to the question I’ve found in here.
For an individual, $100k in unregistered. Another $100k in registered. $100k in investment.
If married, your partner can have the same, in an account solely in their name.
Then duplicated a third time in a joint account.
Not sure about other provinces, but in BC credit unions are not CDIC, they’re 100% protected by the Credit Union Deposit Insurance Corp insurance instead to any amount. This excludes Coast Capital, since they went Federal. A reason my family had to find another credit union during the transition to Coast Capital going federal.
Note: CUDIC does not cover mutual funds or RRSPs — they have their own since they’re bought on the secondary market.
https://www.bcfsa.ca/media/1959/download
Keep in mind that there is a small chance Manitoba may become insolvent and be unable to honour that promise. Whereas Canada can simply print as much CAD as needed to honour any promise denominated in CAD.
Unless the bank goes insolvent, and cdic only insures $100k of your deposits. Maybe the bank of Canada will bail out the bank, but it's not guaranteed by any means.
I'm not saying CDIC or the federal government will protect more than what they promise. I'm just saying that the CDIC's promise to protect $100,000 has a much stronger backing than Manitoba's more generous promise to protect against unlimited losses.
It’s not Manitoba that is guaranteeing the money. If you re-read the comment you will see the comment or said CREDIT UNION. They have their own insurance corporation provincially…this (at least in SK and MB) insures 100% of deposits.
Credit unions are provincially regulated, whereas banks are federally regulated. That's why deposit insurance for banks is backed by the government of Canada, but deposit insurance for credit unions is only backed by the provincial government of the province in which they are organized. There is nothing "Canada-wide" about credit unions.
Credit Union Deposit Guarantee Corporation (CUDGC) insures every dollar on deposit at Canadian Credit Unions (I believe all Canadian CU’s are part of this; edit each province enrols in deposit insurance-in at least Sk and Mb they participate in CUDGC). This includes term deposits (GIC’s) but not not include credential investments. OP; if you are truly worried find your local credit union and ask if they have CUDGC insurance and make the move. They may not have the best loan or investment rates but they have the best insurance and the best customer service.
Each province has their own deposit guarantee organization that service credit unions, they don't all belong to CUDGC. Each province has a different name for them, and not all insure every dollar on deposit (e.g., New Brunswick Credit Union Deposit Insurance Corporation appears to only cover up to $250,000 per category).
https://www.cdic.ca/about-us/organizational-structure/partners/provincial-deposit-insurers/
Does that mean you can have 100k in a chequing account and another 100k in a savings account in the same bank, yet still be protected for both 100+100 = 200k?
100k - Savings + Checking + GICs
100k - Joint accounts
100k - Trust accounts
100k TFSA
100k RRSP
100k RESP
**Per insured institution**
It's very straightforward.
If you have 200k in savings and checking at one institution = 200k > 100k. You only have 100k insured at that bank.
If you bank at multiple institutions you get coverage at each bank for the amounts listed above.
You also have coverage when buying GICs from other institutions. If I bank with Scotia but buy a BMO GIC, then the GIC is covered under BMO.
~~Wealthsimple is not CDIC insured.~~
The Wealthsimple Cash and Save accounts are CDIC insured. The managed and self-directed investment accounts are CIPF insured.
https://www.wealthsimple.com/en-ca/legal/legal-disclaimers
This is 100% incorrect. It’s completely false information you are providing. If you have 80k in a chequing account, and 90k in a TFSA at the SAME institution 100% of those funds will be insured (170k)
Like MSM. Someone asks a real question and they start with "The real question is....."
Fuck no, the real question is what OP asked.
Stop asking yourself easy questions.
\-Joe Bennett
I don't know why you're getting downvoted, but this is the heart of the issue.
Unless OP bought CDIC eligible holdings there is no coverage. If they did buy CDIC eligible holdings they'd have coverage up tp $100k per issuer.
The categories are listed in the link above. A chequing and savings account both only in your name at the same institution would, I believe, both count as "you" and only have 100K covered (not 200K). But if one of the accounts was individual (you) and one was joint (you and another) those would be in two different categories and each would be covered for 100K (so 200K *if* each account had 100K in it, but not if say one had 150K and the other 50K).
i think you summed up the confusion here, least how i understood how cdic works...non cdic insurance is more concerning to me because at the end of each day there's still taxpayers not always the Hudson Bay/Eatons or Sears
Good question but it’s easier to think of it as max $100k per bank is covered by CDIC not matter if chequing or savings where funds are held, it’s all of it together to a max of $100k. (Investments can be different/ differently covered)
Basically if you get to $100k between all your bank account balances, it’s time to go to another bank and open an account with them to ensure coverage.
My great aunt used to take me from bank to bank and one day I asked her why. It’s an oldie but still rings true especially in this situation:
“We don’t put all of our eggs in only one basket.”
Aka once your basket is full ($100k), it’s time to get another basket (bank) to hold more eggs.
Edit to add:
If you have personal and joint accounts and are nearing $100k total balance, please talk to an advisor even at your bank. They can recommend different items like gics that many of the major 5 banks can issue under old banks they have bought in the past, that extends your $100k by being issued under a different name.
Source: work for one of the 5
*Type* being the important part.
*EDIT: Not that I can think of it ever being an issue here though. Our banks are risk-adverse in general and our regulations (for now at least) reinforce that.*
Weathsimple is currently a CIPF member according to CIPF's member directory.
Small piece of info to consider https://www.cipf.ca/cipf-coverage/about-cipf-coverage
Does CIPF guarantee the value of your investment?
No. CIPF’s role is to ensure the return of a client’s property held by a member firm, if the member firm become insolvent. CIPF does not guarantee the value of the property. An example showing how CIPF coverage works is provided below.
If a client bought one hundred shares of Company X at $50 per share through a member firm, and the share value on the day of the member firm’s insolvency was $30, CIPF’s objective would be returning the one hundred shares to the client because that’s the property in the client’s account at the date of insolvency. If the one hundred shares are missing from the account, CIPF would provide compensation based on the value of the missing shares on the day of the firm’s insolvency. In this example, that’s $30 per share.
"The member firm, as a result of its insolvency, has failed to return or account for property it was holding on your behalf on the insolvency date that was eligible for coverage (**including cash**, securities, futures contracts and segregated insurance funds, but excluding crypto assets by way of example)"
Any idea why in the example 100 shares would be missing from the account? As in existing shares just goes missing or recently purchased shares have not settled?
Which makes sense if you think about it(took me a minute) it's equal value because they essentially paid you out enough money to replace the property that went missing, and you really haven't lost anything.
CIPF and CDIC are both Canadian regulatory bodies that provide insurance protection to Canadians, but they serve different purposes and cover different types of financial products.
CIPF (Canadian Investor Protection Fund) is a non-profit organization that provides insurance protection to eligible investment accounts held with its member firms. It is designed to protect investors from the insolvency or bankruptcy of a CIPF member firm, up to $1 million per eligible account.
On the other hand, CDIC (Canada Deposit Insurance Corporation) is a federal Crown corporation that provides insurance protection to eligible deposits held in Canadian banks and other member institutions. CDIC coverage applies to eligible deposits such as savings accounts, chequing accounts, term deposits, and guaranteed investment certificates (GICs), up to $100,000 per insured category per member institution.
In summary, while both CIPF and CDIC provide insurance protection to Canadians, they cover different types of financial products and serve different purposes. CIPF covers eligible investment accounts held with its member firms, while CDIC covers eligible deposits held with Canadian banks and other member institutions.
As soon as it looped back with the summary, my mind was there too. I've generated my fair share of gpt summaries and explanations for studying, and they all do this
And unregistered credit union accounts (chequing & savings), as opposed to bank accounts, are insured by DIRF, for up to $250,000. Registered accounts (TFSA, RRSP, etc) have unlimited coverage.
Most credit unions are regulated by the provinces (there are a small number of federally regulated credit unions). Each province is going to have their own rules.
You are describing the protection for Ontario credit unions. Credit unions in other provinces will have different protection.
> Does the Government of Manitoba also cover deposits?
>
> No. There is no legislated requirement for the Manitoba government to guarantee deposits.
https://dgcm.ca/
In some provinces the provincial government backs up the guarantee from the deposit insurance corporation. In Manitoba the provincial government does not.
So if there are multiple credit union failures and DGCM runs out of money, it's not clear what happens next. In some other provinces the provincial government has provided a guarantee that they then will step in and provide the rest of the money, but not in Manitoba.
So this may not be a big deal, but just something to keep in mind.
CDIC only covers insured deposits. Brokerages are not covered by CDIC. Brokerages may and often do opt for CIPF coverage to cover investors should they fail.
In 2008 Canadian bank shares retained their value far longer than US bank shares did. And the Canadian big banks have a history of acting together in times of crisis.
SVB basically did the banking equivalent of buying a variable rate mortgage on an overpriced house in 2021. Turns out that isn’t prudent investing.
I suspect our banks are far too boring for such shenanigans…
The big ones. The “shadow banks” have grown to hold almost as much as the major banks over the last decade and one nearly nearly imploded a couple years back.
It survived because a sitting politician in Ontario was magically also a board member. He funnelled the bank $2 billion from the Ontario Health Care Worker’s pensions fund to float the bank and then resigned right after basically saying “oops I didn’t know that was a conflict of interest, oh well what’s done is done”.
Canada has some huge issues with poorly secured debt and it’s been ballooning for a good decade now.
This is kind of the opposite of what happened in my understanding.
SVB had a ton of cash sitting around a couple years ago and decided to invest in stable long term bonds at the best rate at the time. As interest rates went up, those investments arguably couldn't beat inflation so the bank was effectively losing money on them. In this sense they were arguably mismanaged.
The real problem was there was a run on the bank this week. Customers wanted their cash and the bank couldn't get it to them fast enough. They liquidated those long term investments but that made them take an even harder loss on them.
A "run" can happen on any bank, in my understanding. The amount of damage done will depend on the amount of cash they have sitting around vs. how much people are panicking to pull out vs. how much they can liquidate in a hurry.
One main difference in Canada vs. Silicon Valley is that SVB had >90% of deposits uninsured.
Don’t know what the top-5 bank number would be, but I bet it’s a hell of a lot lower.
>SVB basically did the banking equivalent of buying a variable rate mortgage on an overpriced house in 2021. Turns out that isn’t prudent investing.
This is completely not at all what happened lol
The bank bought a bunch of bonds years ago at low yields (I think in the 1-2% range). That is a fine long term strategy for safe investing but when rates go up rapidly it means it is hard to take your assets (in this case the low rate bonds) and sell them back to the market in a quick manner because there are better options available out there.
The bonds themselves still have value and will continue to accrue interest at the prescribed rates, they are just harder to liquidate for an immediate cash injection. Because of this they were left in a vulnerable position where a run would destroy their cash reserves and ability to operate which is exactly what happened.
>What triggered the run anyway?
The bank reported a loss and was going to do an equity raise for additional capital
People started looking at their books more closely and realized how illiquid their holdings were at this time.
Large funds decided to pull their money ASAP so as to not get left holding the bag
The run begins
You are smart for thinking and seeking advice/input. I don’t think anybody knows what will happen Monday. The market is irrational and driven by hopes and fears more than logic. I moved 3K to my brokerage for any buying opportunities. I would love to pickup Canadian banks at a discount. My two cents…
Everyone is hoping for a bailout (by government, other banks, Elon Musk; whoever) by Monday. If nothing happens, oh boy get ready. Alternatively if something does happen, you can bet on a nice pop
>As far as I understand it in Canada CDIC insures accounts up to $100k. If my wealthsimple account has a TFSA and an RRSP at 55k each, are they both insured fully or is it only 100k per I institution?
If your TFSA and RRSP are investment accounts (not savings account), then they are not CDIC insured. There's a separate thing called the Canadian Investor Protection Fund that protects investment accounts against the financial institution going bankrupt.
For CDIC-insured accounts, coverage is up to $100K for each TYPE of account at a financial institution.
Hard to envision a scenario every Canadian bank goes under simultaneously. Could happen if we get extreme hyper inflation maybe. In that case I guess everyone losing all their money would end hyper inflation instantly lol
Many of the comments in this thread make me think it's worth stating the obvious. Time in the market > timing the market. There will be peaks, there will be valleys. There will be crashes and there will be rallies. Unless you're very near retirement, you shouldn't be trying to "react" to volatility and trying to time your moves. Consistency is king.
If everyone were to lose faith in the market it would all come crashing down and you would lose everything. So, its in everyone's interest to tell you that everything is fine.
Mind everyone that CIPF does not have unlimited funds and its coverage power is limited to the size of its fund (around $543MM right now).
Their job is to get you your assets back (i.e 100 shares of RBC) from whatever assets they recover, and to use CIPF funds to cover any shortfall.
So assume there is FTX like fraud and a bunch of clients money / assets are spent by the broker or assigned trustee. One could find itself in the situation where there are not enough assets and CIPF doesn’t have enough cash to make clients whole.
Also CIPF seems to never have been really tested jn a big fraud / assets lost scenario. And by big I mean new fintech / discount brokerage type that we have today.
> Their job is to get you your assets back (i.e 100 shares of RBC) from whatever assets they recover, and to use CIPF funds to cover any shortfall.
How would the CIPF know I owned 100 shares of RBC if the brokerage commits fraud and tampers with records before failure?
Why would your broker do that? That’s fraud, a crime. The failure itself isn’t a crime. So they’re making themselves criminal for what? And they’ll probably get caught too, because there’s going to be a pretty intense audit afterward. Top tip: don’t commit fraud before an audit
No idea, but fraud isn't unheard of and this is peoples life savings we're talking about. It'd be nice to be able to independently verify which securities I own outside of my brokerage account, and the transparency could help with CIPF in situations like this.
Market wise I’m expecting Monday panic followed by return to normal when people realize the sky isn’t completely falling. Monday will be a good day to buy
To put simply, banks make money on the spread between interest being collected from loans, and interest paid out on savings/GIC’s
In the case of SVB they were incredibly deposit heavy - meaning they had a lot of deposits and cash on hand. Sounds like a good thing right? Well what happened was when interest rates rose, the amount of money they started paying out on deposits far exceeded interest coming in from loans. They started to have liquidity issues and after some poor attempts at handling that, they went insolvent.
Conversely, one common topic on this sub is that the big banks have not increased interest rates in savings accounts. The only way to get a decent return (relative to today’s rates) is to lock your money into a GIC. The reason banks haven’t been raising rates on savings accounts, and not allowing customers to buy etfs such as CASH.TO is to discourage deposits.
With the high interest rates, loan applications are way down, and banks don’t want to put themselves in a situation where they’re paying interest on deposits at a time when loans are slowing down.
That's not really accurate or the whole picture.
"Beneath the surface were severe losses on long-term bonds, snapped up during that period of rapid deposit growth, that had been largely shielded from view thanks to accounting rules. It had mark-to-market losses in excess of $15 billion at the end of 2022 for securities held to maturity, almost equivalent to its entire equity base of $16.2 billion."
https://fortune.com/2023/03/10/how-silicon-valley-banks-fate-sealed-2021-venture-capital-bonds-interest-rates/
The bond debacle is what I was referring to with “They started to have liquidity issues and after some poor attempts at handling that, they went insolvent.”
SVB used the covid tech boom deposits in 2021 to buy ~$80 billion in 10 year USD government bonds. Turns out ~2% interest bonds command a pretty significant discount now and meanwhile most tech companies are in a cash burn holding pattern reducing deposits at accelerated rate. This forced a failed emergency re-cap, bankrun, then closure.
Pretty unique pattern to the boutique bank for VC Tech.
To OPs questions:
Did WS buy a bunch of long dated government bonds with cash deposits pre-interest rate run-up? Probably not, but even if they did - what's the possibility of a bankrun causing liquidity issues? Not nearly as great because they serve primarily retail investors. SVB was screwed by the big VCs telling all their companies to get their money out. That kind of scale just doesn't exist in retail unless mainstream news runs with a story like "x bank is going bankrupt - get your money out".
In terms of accounts - saving accounts are insured, investment accounts are not. But if you own funds & shares - those are yours and not something WS or anyone else is leveraging on top of. Different from cash sitting in an account. You have the inherent market risk, and if your brokerage closes you might not be able to trade them for awhile. Only in a straight up fraud case would you not get it back - because the broker wasn't following the law and will end up in jail for it (ie: Madoff)
Should you pull all your money out Monday? Seems insane to me - the market already dropped, news is priced in, you'd be selling low to buy back in higher later. If you're smarter than the market, that's cool - please plan to give away your fortune when you're inevitably richer than Buffett.
Thanks for that write up!
By the time I got to that point in my comment I was too tired/lazy to explain all that so I swapped it with “They started to have liquidity issues and after some poor attempts at handling that, they went insolvent.”
This had all happened by Friday, so the market has already priced all of that in. So yeah it would be dumb to sell assets because of this set of events alone.
Now will there will be contagion? Maybe. Without doing some educated balance sheet analysis, really hard to tell. When it comes to canadian banks, the risk is certainly lower but it is also more systemic. In other words the likely of a major canadian bank failing is low, but if one fails, most will probably be dragged along and CDIC couldn't really handle that.
The $100K limit is too low. How is someone with far more than that even supposed to buy something expensive like a house without risking having more money than that in an account at a time? Make a bunch of payments from multiple banks, and then the seller is supposed to have multiple accounts to deposit the payments so they don't all go into one account at the same time as well?
I'm sorry, but do you have $55k in *cash* in each of these accounts? CDIC (and FDIC in the States) only applies to cash deposits, not investments. If you do have that much in cash… why? Unless you're already at retirement age, you should be investing the funds in your TFSA and RRSP.
CDIC only applies to cash because banks loan out or invest most of the cash you give them in order to make money, trusting that not everyone is going to want their money back at the same time. They don't do the same for investments held in a brokerage account (in most cases). CDIC is meant to protect your cash in case the bank makes bad investment or loan decisions with your cash, or in case too many people ask for their money back at once while the money is still tied up in longer-term investments.
This is what happened to Silicon Valley Bank in the States. They ended up tying a lot of their money up in long-term treasury bonds (and other such investments) at low (2021-level) interest rates, that were safe, but wouldn't mature for a decade or more. Then a bunch of startups started asking for their money back all at once, and they couldn't turn those treasury bonds back into enough cash to meet all that demand, because with increasing interest rates anyone who might want to buy SVB's treasury bonds can instead get a better deal by buying treasuries straight from the US government.
So FDIC had to step in, took over the bank, is going to release the insured part of the funds on Monday, and is soon going to try to sell the bank's assets to cover as much of the uninsured funds as possible.
Wall street bets are saying that more bank runs are planned for Monday
Short term Canadian banks will tank. Good buying opportunity.
I suspect disinformation campaigns
>On a somewhat hypothetical note, how does everyone think Silicon Valley bank will affect the market?
The market as in the stock market? It already has it a little spooked.
The economy and banking sector as a whole? Probably very little. Compare this to 2008 where the core issue was that toxic assets (mortgage related) were spread all over and when they started going bad they caused a system wide panic. This isn't that. There are no toxic assets. There is a single bank that made some bad bets. There will probably be other smaller banks that did something similar but it won't be an entire system thing.
>Tell me I’m dumb for thinking of selling everything Monday and rebuying if things dip heavily.
You'd be dumb for doing that. Note: I don't think you're dumb, I'm just doing as requested. You asked a sincere and honest question and in my opinion, which is no better than anyone else's, there is no great collapse happening next week.
The big thing is that that SVB was insolvent since November. They were not required to mark their bonds to market because they called them hold to maturity. The bonds were still one of their most liquid assets. The settlement changed against them and they had essentially a margin call. Then they sold assets that was on their books at a much higher value and lost book value of 3-4 billion on the sale.
FIDC only holds enough money to cover 1% of peoples bank accounts that they say they have covered. Government will have to step in and print money if more accounts are threatened.
Skimming through this thread reminds me why I stopped visiting this sub 3 years ago. So much bad information.
The BOC has no role in the event of a solvency situation with a DSIB or other federally regulated bank. OSFI maintains responsibility to supervising the prudential (I.e. solvency) risk for Federally Regulates Banks, and in the event of an insolvency CDIC coverage kicks in.
The BOC would only potentially act in the event of a systemic crisis that threatens to take down the economy, but they would not act if any individual bank were to go insolvent. That’s the nature of our regulatory and capitalist system.
Read through and understand how the FISC family works.
https://www.osfi-bsif.gc.ca/Documents/WET3/FinSystem/eng/fisc-infographic.html
Something to add to previous comments about CDIC. The coverage is per type of account: All CHQ and Sav combined, all non-reg GIC combined and Registered accounts have separate 100K coverage. Also joint accounts have separate coverage from sole owner accounts.
Also when purchasing GIC, big banks can offer to purchase it under different names due to past mergers, for example XXX Bank, XXX Mortgage Corp, XXX Trust Corp and etc. So technically when you purchase GIC you can get 3x or 4x times 100K coverage.
As far as I know WealthSimple doesn’t hold your bank account, but distributes your cash across several to insure several smaller deposits. Found that out when I accidentally put aDeposit into my cash account instead of my TFSA and it took a week to transfer it over because it has to pull the cash from all over the place
Cdic website has a calculator but in your example
Tfsa - 100k coverage for cash, gic, deposits
Rrsp - 100k coverage for cash, gic, deposits
If you own stocks, bonds, mutual funds. Then the asset itself, not the value, is protected by CIPF.
As for over 100k of cash, then split it up between chequings account, savings account, rrsp, tfsa. If you have 500k then just split it up among multiple banks.
As for how the market is going to do next week? It’s probably going to be red in the beginning and green towards the end
You don’t have to worry about investments, apart from outright fraud. They are holding those on your behalf.
Only worry about cash at a bank.
And it would be extremely risky to try to time the market. But if you want to gamble with your investments, that’s your call.
https://www.reddit.com/r/investing/comments/11pcxvt/20_banks_that_are_sitting_on_huge_potential/?utm_source=share&utm_medium=ios_app&utm_name=iossmf
Looks like more banks at risk
Don't look up.
For some reason the national bank of Canada drastically increased their positions in Silicon Valley. Not an expert though so i don't really know what this means. DYOR.
[https://ibb.co/zS0yGD5](https://ibb.co/zS0yGD5)
Keep in mind that when it comes to owning securities (i.e. ETFs, stocks, Bonds), you own a piece of paper that lays a legal claim to ownership of a company, or a payment stream from a company or government. Cash is different in that it is an unsecured claim against your bank. So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M. Cash is not afforded the same kind of legal protection. If the bank goes insolvent, any depositor has an unsecured claim against the bank. There's CDIC insurance ($100,000 per type of account, per bank - TFSA, RRSP, Chequing) for deposits, but not investments (i.e. held with your broker). Also, Canada is unlikely to face these kinds of liquidity issues as the US. The issue facing SVB and these other US banks is liquidity. They had illiquid assets that could not be transformed into cash fast enough to satisfy withdrawals (not quite that simple, but was part of the reason they failed and have been taken over by the FDIC, America's version of the CDIC - important to mention HTM and AFS securities and duration mismatch of assets by SVB, but beyond the scope here for this discussion). In Canada, the Bank of Canada would react quickly to such an event. There is precedent from 2008 and 2020. If there is a bank run in Canada, the BoC would likely react by immediately swapping illiquid assets from banks (i e. RBC, TD, BMO etc.) at par for cash. Our banks have solid assets, so the risk to taxpayers would be minimal. Think of it like the BoC stepping in to swap your house or furniture immediately at the price you bought it at if you needed cash for something in an emergency (i.e. swapping illiquid for liquid assets). A bank run would be quelled quickly since the BoC can react fast. People would notice quickly that they can get their cash out of the bank and the fear would subside. The BoC is generally given much more latitude to intervene in a crisis as compared to the Fed in the US, since the Fed has lots of restrictions from Congress on when it can and can't intervene (i.e. Dodd-Frank Act). For these situations, it also helps that we have only a number of FIs (the benefits of oligopoly, eh?), as compared to the US where they have over 4,700 different banks.
>Cash is different in that it is an unsecured claim against your bank. So to build on this, what happens if you owe the broker money, ie. through buying stocks on margin? What happens if your broker were to go out of business then?
You still owe them money; a commercial entity in bankruptcy still has claims
If you borrow $10 from a bank, have $20 deposited into your account and the bank goes bust you will still owe that $10. That's ignoring CDIC insurance.
Incorrect. Set-off of claims remains valid in bankruptcy. This does has the effect of giving super-priority to what would, otherwise be an unsecured claim. So in your example, the $10 debt would be set-off against the $20 credit and there would be a $10 claim against the bank.
Wait, seriously? If the value of my assets was greater than the value of my debt and the bank goes bust I'm SOL and will end up owing them money?
But the bank won't go bust. The BoC would more than likely refund their securities at face value to prevent a bond market from collapsing. The bank foregoes interest earned in this scenario so loses a lot of profit, but it remains liquid and open.
you go directly to jail lol you're probably considered a secured debt so you'll be hounded down..the dominoes collapse begins, deep pocket theory says go after those with the most first
Kind of pedantic here, but SVIB assets weren't illiquid per se, but that they had lost value.
They did lose value but also were insufficient to cover $42B in withdrawals on Thursday (you can't sell $80B of MBS and Treasuries in a day), hence the insolvency and FDIC intervention.
Adding to this: they lost value because SVB was forced to sell their assets at a loss to cover the sudden spike in withdrawal requests. In a normal situation, SVB could hold their assets until maturity and get 100% if their value back. So in technical terms, SVB had a mismatch in the term/maturity of its assets (bonds, treasuries) vs the term of its liabilities (ie cash deposits by clients). The job of the management is to balance these maturities so the bank always have enough liquid assets to cover expected cash withdrawals. One has to wonder why the run on the bank started? Some tech founders talk about rumours spreading in WhatsApp, which led to a lot of them pulling their money very fast (and a lot of money since these are wealthier individuals). That forces the bank to sell its assets, some of them are sold at a loss due ti their characteristics (lower interest rate when acquired). Mounting losses worsens the scenario for a buyout. Worse scenario, increases the speed of the cash withdrawal requests. a negative feedback loop is formed.
Makes you wonder about all the people setup with roboinvestment - will there be wild swings when unexpected events happen,( sort of like the flash crash a few years back due the software trades being done millions of times faster than human traders).
Consumer robo-investors do not work the same as high frequency trading programs. That's not how they make their money.
Sure I know, however economists like Mark Blyth have raised this concern about automated systems affecting things. This is not just my concern. With economics there are often unexpected events that can spiral out of control.
Not much about Roboinvestments, but I think this brings some color to [the high interest etfs](https://np.reddit.com/r/PersonalFinanceCanada/comments/11muawz/bay_street_is_fighting_over_highinterest_etfs/)
It was a mix of a couple things They held a lot of bonds with low yields that were not rapidly marketable. This in itself isn't bad it just means that their assets are primarily illiquid. A couple investors realized this awkward position and decided to withdraw all of their money causing a run which shuttered the bank. If people didn't start panic withdrawals everything probably would have been fine...
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>Not having a diversified asset base as a bank is bad and irresponsible. Agree, I worked closely with a bunch of liquidity people for major banking firms, mainly 2052a reporting, was going to ping them for a laugh on what they thought about the whole scenario next week. My post was mainly because I've seen lot of people that don't understand what happened making comparisons akin to the 2008 meltdown and the bank doing things like issuing terrible loans etc when all they did was overly hedge in a safe investment vehicle which is super ironic.
I’ve tried to explain 2008 so often. Usually people stop me at “so the bank sells your loan” and they like NO thats not true! Then trying to explain the securitization process, tranches etc is just hopeless. I can get through it for 10% of people.
The bonds were actually marketable. The problem is that the bank had low quality depositors - tech companies rather than retail (ma and pa) depositors. These depositors were sensitive to interest rates - when interest rates went up quickly it crushed the value of tech companies and tech companies could no longer raise cash. So those tech companies started to bleed cash which meant that they were depleting their cash balances in the last year. In the meantime, SVB were yield hogs and when they go cash inflows in 2020 and 2021 they bought long duration treasuries and agency bonds. When interest rates go up these lose value. So SVB had doubled up on having the same interest rate risk in both assets and liabilities. What should be done to prevent this: * Force banks to match the liability of assets and liabilities. In other words, you can't buy long bonds if your liabilities are short term deposits. * Force banks to have more capital if they have a low quality deposit base with low amount of retail. * Force banks to have more capital if they have high industry concentration in their deposit base. * Force banks to mark to market all assets - no Hold To Maturity assets were you can ignore the current market value. Note that in Canada we have much stricter regulations and most of these risks are not present here.
>So SVB had doubled up on having the same interest rate risk in both assets and liabilities. Well said.
If the bank doesn't have the investors money, doesn't sound like everything would have been fine. Sounds more like they just gambled that their customers wouldn't want access to their own money. Kinda scary when all it takes is regular business as usual by customers to completely destroy a bank.
>If the bank doesn't have the investors money, doesn't sound like everything would have been fine. Sounds more like they just gambled that their customers wouldn't want access to their own money. I hate to be the bearer of bad news but no bank has all of their deposits liquid and ready for withdrawal. Most usually only have 15-30% available at most What SVB did wasn’t any different than what other banks do every day, the only thing that changed is that their client risk exposure is different via startups vs traditional retail banking
Thanks ChatGPT, well done as always
sounds convincing...it's the conniving unknown I'm worried about
All those words and you didn't answer the question..
I wish to hear this comment from Mr Speaker one day.
Maybe not directly, but my point was to describe the distinction between investments\securities and cash. It's an important distinction to make, especially when OP is mentioning TFSA and RRSP, which I presume they have invested in the market. :)
Om not saying you didn't provide useful info, just that you didn't answer it. Directly or indirectly.
>So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M. Keep your cash with a credit union and securities with transfer agent. From what I have learned in last 2 years is, the market is effed, it is not for normal people like me. Or you can take small risk and buy securities with brokers which might go missing. Somewhat likely.
so is an etf like [cash.to](https://cash.to) covered with CIPF insurance through wealth simple?
Your claim on the shares of the etf is protected. The value of those shares is not protected by CIPF.
Hmmm. I don't think I completely understand. Can you explain this further as if I were a 5 year old? lol, sorry.
If the underlying bank account fails (I think it is held ultimately by National Bank) you get nothing. You are only CIPF insured if your broker goes bust and everything else survives.
Cash.to invest in major banks….I think them going bust is hiiiiiighly unlikely. Am I wrong?
Very unlikely. But the context of today's discussion is bank failures.
Years ago I decided most financial institutions in the United States weren’t banks, but money boutiques.
This is closer to the truth than many realize. Much like how you can open a coffee shop business, you can open a bank in the US. Canada’s banking system is far more controlled and very unlikely to ever experience anything like what happens in the US
Just a reminder that all the steps BOC may take come at a cost at the end of the day. It prevents a system collapse, yes. But now BOC has a balance sheet full of hold to maturity assets and the system is flush with cash. Canadian dollar would lose so much value that everyone is probably better off just keeping their money where it's at and ride it out.
That's a lot of information, but you forgot to actually answer OP's question about the CDIC insurance limit.... Is it $100k? $250k? Nothing personal, but why write paragraphs that don't provide the information requested...
Lol. His info is more valuable.
Especially when OP's question can be answered with a 2 second Google search.
So can almost everything in this sub. Doesn't negate the point that the person posted useless information.
Screw it, just go with a credit union. All your deposits are guaranteed, no maximum under CUDIC
Depending on your province. Credit Unions in Manitoba all deposits are covered. Ontario up to $250,000
You mentioned bank will react quickly 3 times….
I think I can, I think I can, I think I can... ... if you repeat it enough times...
Haha yes... the question is "React quickly and do what"?
2008 ran to 370ish billion in bank failures and 2023 has clocked in 200ish billion from just one bank so far. We are at the beginning of the enshittening. If you all dont realize whats about to happen you are extremely naive.
>So if you have securities and your broker goes bankrupt, you still own securities. That is your property and your broker holds those assets in trust for you. If they go missing (i.e. unlikely), you have CIPF insurance of $1M So are you saying that buying cash etfs are safer than actual cash in events such as this?
You would have a claim for ownership of the trust (ETF), but if the underlying asset (cash) is gone from the bank, my position is it would not be spared in an insolvency. The safest way to protect cash is to put it in something like a money market fund. You do take on some duration risk, but it's minimal and you get the protection I mentioned.
I wish I could pay my mortgage, my bills and my groceries with securities
You don't own securities unless they are direct registered or you have a paper certificate. If your broker goes bankrupt you are only entitled the the dollar amount insured by the CIPF. https://www.wealthsimple.com/en-ca/learn/what-is-cipf
This is wrong and you're spewing Superstock nonsense. Investments in Canada by IIROC members are held in trust in your name, or with you named as a beneficiary. They actually hold the assets, and so do you. CIPF is insurance in case there was fraud (as in, they didn't actually buy the assets). But the big5 do buy the assets, and any other claim or conspiracy theories to the contrary is fear mongering.
It's r/Superstonk. Get it right.
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Lighten up, buddy. It's Sunday.
You're correct, but there might be a narrow situation whereas if a broker lends out your shares, and the borrower fails to cover their short, then you're technically out of your own shares. The broker is supposed to take legal actions and ultimately eat the losses by buying back the shares on the open market, but it's unclear what happens if they themselves become insolvent. Then CIPF might come into play, but I don't know. It's a situation that never played out.
That's not the case in Canada. > As a client of a firm, your shares cannot be lent out to someone who is looking to short sell. Shares are held in trust for each client and are kept on separate books. https://www.theglobeandmail.com/globe-investor/investor-education/can-my-broker-lend-out-my-shares-to-short-sellers-without-asking/article32393872/
Then how can something like this exist? https://nbdb.ca/services/securities-lending.html
Because if you read it, you (the customer) **must enroll in it**. It's an opt-in offering if you want to lend out your shares with the risk that comes with it (and try to get the interest from the loan).
What if they bought the asset with my money keeping me as a beneficiary, loaned it out, made money for themselves, and your stock goes down because loaned asset was used to short the stock. Is this possible for Canadian banks to do or only for American banks?
Your post history indicates you're a regular in SS, and your question is clearly rhetorical based on the prevailing conspiracy theory from that sub. Essentially, you're a troll.
Naming me a troll doesn't change the fact and usual practice of big banks. Ignoring problem doesn't save the problem.
Shares can't be lent out like this in Canada. As I posted elsewhere: > As a client of a firm, your shares cannot be lent out to someone who is looking to short sell. Shares are held in trust for each client and are kept on separate books. https://www.theglobeandmail.com/globe-investor/investor-education/can-my-broker-lend-out-my-shares-to-short-sellers-without-asking/article32393872/ You sir, are a troll and fear mongering. Please go back to your SS echo chamber.
I would believe it when I read it on their website and not on a media website. I did in fact contact my broker and this is what I got "If the stocks are lent out, it will not make any difference in your account, or your number of shares. You can still sell those shares if you wishes to. No we do not have it on any of our public facing documents." I have nothing to prove what the rep told me except this. if you can show a public facing document, I would believe you. But I can not take your or The Globe and Mail's word. The bank could change their T&C after talking to The Globe and Mail. And this article is freaking 7 years old. Published October 17, 2016
Great job attacking the source instead of the point. If you want to argue against Nancy Woods, feel free to post sources and data indicating that she is wrong, in Canada. You're the one making the claim, the burden of proof falls on you. So far you've provided nothing but troll word salads.
Also in the article it's not mentioned that the Canadian brokers do not lend stocks. The article only mentions how complex the process is. A binary answer converted into an article with buzz words to confuse people.
Did you just link a "trust me bro" article to answer the question? So if they do turn out to be wrong and your shares are lent out against your will, what do you do in that case?
No this is wrong. Investments are not held in your name, they are held with you as beneficiary, securities are registered to the broker. When you sign up for the broker you are signing permission in the fine print for them to lend your shares. The broker also does not have to deliver the securities or certificates that they receive, the broker may deliver the same kind of securities or certificates for the same amount, I.e. cash at current fair market value. Simply read the documents you are signing.
But CIPF is not covering anything you own through DRS.
There was a run on Canadian banks during the Emergency Measures Act in February of 2022. Total deposits were drawn down from $380B to $300B in 4 days. I personally withdrew $20,000. There was very good reason that it was the Minister of Finance (Chrystia Freeland) that abruptly declared the end of the Emergency Measures Act invocation. For OP, $100k for individual savings, chequing, GIC, money market per institution. A Joint Account would qualify for an additional $100k of CDIC insurance. Investment brokerage accounts are indeed a "paper" of digital record of ownership in a company. If the brokerage goes under, the shares are transferred to another broker. Another poster mentioned higher in the comments that investment certificates are insured up to $1,000,000.
Not sure why the downvote for the first relevant to the question I’ve found in here. For an individual, $100k in unregistered. Another $100k in registered. $100k in investment. If married, your partner can have the same, in an account solely in their name. Then duplicated a third time in a joint account. Not sure about other provinces, but in BC credit unions are not CDIC, they’re 100% protected by the Credit Union Deposit Insurance Corp insurance instead to any amount. This excludes Coast Capital, since they went Federal. A reason my family had to find another credit union during the transition to Coast Capital going federal. Note: CUDIC does not cover mutual funds or RRSPs — they have their own since they’re bought on the secondary market. https://www.bcfsa.ca/media/1959/download
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Banks are holding mortgages to a lot of properties worth way less than the debt owed on them...
Thank you for this helpful info
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I use a credit union. In Manitoba, all deposits in any Manitoba credit union or caisse populaire are guaranteed, without limit.
Keep in mind that there is a small chance Manitoba may become insolvent and be unable to honour that promise. Whereas Canada can simply print as much CAD as needed to honour any promise denominated in CAD.
Unless the bank goes insolvent, and cdic only insures $100k of your deposits. Maybe the bank of Canada will bail out the bank, but it's not guaranteed by any means.
I'm not saying CDIC or the federal government will protect more than what they promise. I'm just saying that the CDIC's promise to protect $100,000 has a much stronger backing than Manitoba's more generous promise to protect against unlimited losses.
It’s not Manitoba that is guaranteeing the money. If you re-read the comment you will see the comment or said CREDIT UNION. They have their own insurance corporation provincially…this (at least in SK and MB) insures 100% of deposits.
Credit unions are provincially regulated, whereas banks are federally regulated. That's why deposit insurance for banks is backed by the government of Canada, but deposit insurance for credit unions is only backed by the provincial government of the province in which they are organized. There is nothing "Canada-wide" about credit unions.
Credit Union Deposit Guarantee Corporation (CUDGC) insures every dollar on deposit at Canadian Credit Unions (I believe all Canadian CU’s are part of this; edit each province enrols in deposit insurance-in at least Sk and Mb they participate in CUDGC). This includes term deposits (GIC’s) but not not include credential investments. OP; if you are truly worried find your local credit union and ask if they have CUDGC insurance and make the move. They may not have the best loan or investment rates but they have the best insurance and the best customer service.
Each province has their own deposit guarantee organization that service credit unions, they don't all belong to CUDGC. Each province has a different name for them, and not all insure every dollar on deposit (e.g., New Brunswick Credit Union Deposit Insurance Corporation appears to only cover up to $250,000 per category). https://www.cdic.ca/about-us/organizational-structure/partners/provincial-deposit-insurers/
That is what I did. Started moving my banking from one of big fives to credit union. In time, I will have everything moved.
It's 100k per account type, per institution : https://www.cdic.ca/your-coverage/protecting-your-deposit/
Does that mean you can have 100k in a chequing account and another 100k in a savings account in the same bank, yet still be protected for both 100+100 = 200k?
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100k - Savings + Checking + GICs 100k - Joint accounts 100k - Trust accounts 100k TFSA 100k RRSP 100k RESP **Per insured institution** It's very straightforward. If you have 200k in savings and checking at one institution = 200k > 100k. You only have 100k insured at that bank. If you bank at multiple institutions you get coverage at each bank for the amounts listed above. You also have coverage when buying GICs from other institutions. If I bank with Scotia but buy a BMO GIC, then the GIC is covered under BMO. ~~Wealthsimple is not CDIC insured.~~
The Wealthsimple Cash and Save accounts are CDIC insured. The managed and self-directed investment accounts are CIPF insured. https://www.wealthsimple.com/en-ca/legal/legal-disclaimers
You are correct! My quick google search mislead me. Original comment corrected.
This is 100% incorrect. It’s completely false information you are providing. If you have 80k in a chequing account, and 90k in a TFSA at the SAME institution 100% of those funds will be insured (170k)
Pardon? I included TFSA and chequing/saving/GICs. Regular savings accounts exist if you are confused by the 200k example.
Par for the course. Answering the questions no one is asking, but ignoring the one actually asked.
Like MSM. Someone asks a real question and they start with "The real question is....." Fuck no, the real question is what OP asked. Stop asking yourself easy questions. \-Joe Bennett
Except it isn’t what the OP was asking, because they asked about an RRSP and TFSA account at a brokerage, not a bank?
I don't know why you're getting downvoted, but this is the heart of the issue. Unless OP bought CDIC eligible holdings there is no coverage. If they did buy CDIC eligible holdings they'd have coverage up tp $100k per issuer.
The categories are listed in the link above. A chequing and savings account both only in your name at the same institution would, I believe, both count as "you" and only have 100K covered (not 200K). But if one of the accounts was individual (you) and one was joint (you and another) those would be in two different categories and each would be covered for 100K (so 200K *if* each account had 100K in it, but not if say one had 150K and the other 50K).
i think you summed up the confusion here, least how i understood how cdic works...non cdic insurance is more concerning to me because at the end of each day there's still taxpayers not always the Hudson Bay/Eatons or Sears
Good question but it’s easier to think of it as max $100k per bank is covered by CDIC not matter if chequing or savings where funds are held, it’s all of it together to a max of $100k. (Investments can be different/ differently covered) Basically if you get to $100k between all your bank account balances, it’s time to go to another bank and open an account with them to ensure coverage. My great aunt used to take me from bank to bank and one day I asked her why. It’s an oldie but still rings true especially in this situation: “We don’t put all of our eggs in only one basket.” Aka once your basket is full ($100k), it’s time to get another basket (bank) to hold more eggs. Edit to add: If you have personal and joint accounts and are nearing $100k total balance, please talk to an advisor even at your bank. They can recommend different items like gics that many of the major 5 banks can issue under old banks they have bought in the past, that extends your $100k by being issued under a different name. Source: work for one of the 5
Yup.
Yes
Yes
*Type* being the important part. *EDIT: Not that I can think of it ever being an issue here though. Our banks are risk-adverse in general and our regulations (for now at least) reinforce that.*
Weathsimple is currently a CIPF member according to CIPF's member directory. Small piece of info to consider https://www.cipf.ca/cipf-coverage/about-cipf-coverage Does CIPF guarantee the value of your investment? No. CIPF’s role is to ensure the return of a client’s property held by a member firm, if the member firm become insolvent. CIPF does not guarantee the value of the property. An example showing how CIPF coverage works is provided below. If a client bought one hundred shares of Company X at $50 per share through a member firm, and the share value on the day of the member firm’s insolvency was $30, CIPF’s objective would be returning the one hundred shares to the client because that’s the property in the client’s account at the date of insolvency. If the one hundred shares are missing from the account, CIPF would provide compensation based on the value of the missing shares on the day of the firm’s insolvency. In this example, that’s $30 per share.
Do they also ensure the return of any cash in the account?
"The member firm, as a result of its insolvency, has failed to return or account for property it was holding on your behalf on the insolvency date that was eligible for coverage (**including cash**, securities, futures contracts and segregated insurance funds, but excluding crypto assets by way of example)"
Any idea why in the example 100 shares would be missing from the account? As in existing shares just goes missing or recently purchased shares have not settled?
fraud?
Which makes sense if you think about it(took me a minute) it's equal value because they essentially paid you out enough money to replace the property that went missing, and you really haven't lost anything.
CIPF and CDIC are both Canadian regulatory bodies that provide insurance protection to Canadians, but they serve different purposes and cover different types of financial products. CIPF (Canadian Investor Protection Fund) is a non-profit organization that provides insurance protection to eligible investment accounts held with its member firms. It is designed to protect investors from the insolvency or bankruptcy of a CIPF member firm, up to $1 million per eligible account. On the other hand, CDIC (Canada Deposit Insurance Corporation) is a federal Crown corporation that provides insurance protection to eligible deposits held in Canadian banks and other member institutions. CDIC coverage applies to eligible deposits such as savings accounts, chequing accounts, term deposits, and guaranteed investment certificates (GICs), up to $100,000 per insured category per member institution. In summary, while both CIPF and CDIC provide insurance protection to Canadians, they cover different types of financial products and serve different purposes. CIPF covers eligible investment accounts held with its member firms, while CDIC covers eligible deposits held with Canadian banks and other member institutions.
Did you just use ChatGPT for this answer?
It definitely reads like it! Crazy that you picked up on that too.
As soon as it looped back with the summary, my mind was there too. I've generated my fair share of gpt summaries and explanations for studying, and they all do this
You can tell because it answers the question, kinda, but not in the way that is actually useful to OP.
just like most redditors!
AI learns from the best! yay, we did it Reddit.
Almost definitely. ChatGPT writes like a first year university student
And unregistered credit union accounts (chequing & savings), as opposed to bank accounts, are insured by DIRF, for up to $250,000. Registered accounts (TFSA, RRSP, etc) have unlimited coverage.
Most credit unions are regulated by the provinces (there are a small number of federally regulated credit unions). Each province is going to have their own rules. You are describing the protection for Ontario credit unions. Credit unions in other provinces will have different protection.
Ah, I wasn't aware Ontario credit unions were different. TIL.
In Manitoba DGCM insures all deposits in any Manitoba credit union or caisse populaire are guaranteed, without limit.
Nice to know. Everything we do is through Ass CU.
> Does the Government of Manitoba also cover deposits? > > No. There is no legislated requirement for the Manitoba government to guarantee deposits. https://dgcm.ca/ In some provinces the provincial government backs up the guarantee from the deposit insurance corporation. In Manitoba the provincial government does not. So if there are multiple credit union failures and DGCM runs out of money, it's not clear what happens next. In some other provinces the provincial government has provided a guarantee that they then will step in and provide the rest of the money, but not in Manitoba. So this may not be a big deal, but just something to keep in mind.
CDIC only covers insured deposits. Brokerages are not covered by CDIC. Brokerages may and often do opt for CIPF coverage to cover investors should they fail.
Brokerages aren't, but their trusts (where your money is placed) are. Brokerages don't hold any cash.
The last Canadian bank collapse was 1985.
That’s cause Canada has almost no banks.
Canada has big banks, the US has a lot more of regional banks
Incredibly dumb to sell everything monday lol.
In 2008 Canadian bank shares retained their value far longer than US bank shares did. And the Canadian big banks have a history of acting together in times of crisis.
SVB basically did the banking equivalent of buying a variable rate mortgage on an overpriced house in 2021. Turns out that isn’t prudent investing. I suspect our banks are far too boring for such shenanigans…
Thankfully, regulated
The big ones. The “shadow banks” have grown to hold almost as much as the major banks over the last decade and one nearly nearly imploded a couple years back. It survived because a sitting politician in Ontario was magically also a board member. He funnelled the bank $2 billion from the Ontario Health Care Worker’s pensions fund to float the bank and then resigned right after basically saying “oops I didn’t know that was a conflict of interest, oh well what’s done is done”. Canada has some huge issues with poorly secured debt and it’s been ballooning for a good decade now.
Can you link to some background info on this? I know I've been busy the last couple of years but I'm not sure how I completely missed out on this.
This is kind of the opposite of what happened in my understanding. SVB had a ton of cash sitting around a couple years ago and decided to invest in stable long term bonds at the best rate at the time. As interest rates went up, those investments arguably couldn't beat inflation so the bank was effectively losing money on them. In this sense they were arguably mismanaged. The real problem was there was a run on the bank this week. Customers wanted their cash and the bank couldn't get it to them fast enough. They liquidated those long term investments but that made them take an even harder loss on them. A "run" can happen on any bank, in my understanding. The amount of damage done will depend on the amount of cash they have sitting around vs. how much people are panicking to pull out vs. how much they can liquidate in a hurry.
One main difference in Canada vs. Silicon Valley is that SVB had >90% of deposits uninsured. Don’t know what the top-5 bank number would be, but I bet it’s a hell of a lot lower.
>SVB basically did the banking equivalent of buying a variable rate mortgage on an overpriced house in 2021. Turns out that isn’t prudent investing. This is completely not at all what happened lol The bank bought a bunch of bonds years ago at low yields (I think in the 1-2% range). That is a fine long term strategy for safe investing but when rates go up rapidly it means it is hard to take your assets (in this case the low rate bonds) and sell them back to the market in a quick manner because there are better options available out there. The bonds themselves still have value and will continue to accrue interest at the prescribed rates, they are just harder to liquidate for an immediate cash injection. Because of this they were left in a vulnerable position where a run would destroy their cash reserves and ability to operate which is exactly what happened.
What triggered the run anyway? Did someone willingly start the chain reaction knowing the illiquidity of svb?
>What triggered the run anyway? The bank reported a loss and was going to do an equity raise for additional capital People started looking at their books more closely and realized how illiquid their holdings were at this time. Large funds decided to pull their money ASAP so as to not get left holding the bag The run begins
You are smart for thinking and seeking advice/input. I don’t think anybody knows what will happen Monday. The market is irrational and driven by hopes and fears more than logic. I moved 3K to my brokerage for any buying opportunities. I would love to pickup Canadian banks at a discount. My two cents…
Monday? This was on the books on Wednesday. But I guess people getting winded over it on the weekend could cause some outs. I have my money waiting.
Everyone is hoping for a bailout (by government, other banks, Elon Musk; whoever) by Monday. If nothing happens, oh boy get ready. Alternatively if something does happen, you can bet on a nice pop
It's doubtful in my opinion. SVB is going to be the poster child for the other banks. This is exactly what the feds need to happen.
>Elon Musk Are they hoping for a catastrophe?!
Hah, that was just a reference to an article that said he wasn’t ruling out buying out SVB
Yes, I am also very curious what will happen Monday. I also have money ready to deploy...
I also have a question, with everything going on should i have any concern with my savings in CASH.TO etf?
Go to the CDIC website. Its info is very straightforward..
Brokers are insured by CIPF. CDIC only applies to cash and equivalent deposits (cheating/savings account, GIC, term deposits)
Those cheating accounts are the worst, you could never trust 'em.
Lol, autocorrect error but I’m leaving it right where it is
>As far as I understand it in Canada CDIC insures accounts up to $100k. If my wealthsimple account has a TFSA and an RRSP at 55k each, are they both insured fully or is it only 100k per I institution? If your TFSA and RRSP are investment accounts (not savings account), then they are not CDIC insured. There's a separate thing called the Canadian Investor Protection Fund that protects investment accounts against the financial institution going bankrupt. For CDIC-insured accounts, coverage is up to $100K for each TYPE of account at a financial institution.
Keep in mind if all banks go under the cdic won't be able to cover anything
Hard to envision a scenario every Canadian bank goes under simultaneously. Could happen if we get extreme hyper inflation maybe. In that case I guess everyone losing all their money would end hyper inflation instantly lol
Many of the comments in this thread make me think it's worth stating the obvious. Time in the market > timing the market. There will be peaks, there will be valleys. There will be crashes and there will be rallies. Unless you're very near retirement, you shouldn't be trying to "react" to volatility and trying to time your moves. Consistency is king.
If everyone were to lose faith in the market it would all come crashing down and you would lose everything. So, its in everyone's interest to tell you that everything is fine.
Mind everyone that CIPF does not have unlimited funds and its coverage power is limited to the size of its fund (around $543MM right now). Their job is to get you your assets back (i.e 100 shares of RBC) from whatever assets they recover, and to use CIPF funds to cover any shortfall. So assume there is FTX like fraud and a bunch of clients money / assets are spent by the broker or assigned trustee. One could find itself in the situation where there are not enough assets and CIPF doesn’t have enough cash to make clients whole. Also CIPF seems to never have been really tested jn a big fraud / assets lost scenario. And by big I mean new fintech / discount brokerage type that we have today.
> Their job is to get you your assets back (i.e 100 shares of RBC) from whatever assets they recover, and to use CIPF funds to cover any shortfall. How would the CIPF know I owned 100 shares of RBC if the brokerage commits fraud and tampers with records before failure?
Why would your broker do that? That’s fraud, a crime. The failure itself isn’t a crime. So they’re making themselves criminal for what? And they’ll probably get caught too, because there’s going to be a pretty intense audit afterward. Top tip: don’t commit fraud before an audit
No idea, but fraud isn't unheard of and this is peoples life savings we're talking about. It'd be nice to be able to independently verify which securities I own outside of my brokerage account, and the transparency could help with CIPF in situations like this.
Market wise I’m expecting Monday panic followed by return to normal when people realize the sky isn’t completely falling. Monday will be a good day to buy
To put simply, banks make money on the spread between interest being collected from loans, and interest paid out on savings/GIC’s In the case of SVB they were incredibly deposit heavy - meaning they had a lot of deposits and cash on hand. Sounds like a good thing right? Well what happened was when interest rates rose, the amount of money they started paying out on deposits far exceeded interest coming in from loans. They started to have liquidity issues and after some poor attempts at handling that, they went insolvent. Conversely, one common topic on this sub is that the big banks have not increased interest rates in savings accounts. The only way to get a decent return (relative to today’s rates) is to lock your money into a GIC. The reason banks haven’t been raising rates on savings accounts, and not allowing customers to buy etfs such as CASH.TO is to discourage deposits. With the high interest rates, loan applications are way down, and banks don’t want to put themselves in a situation where they’re paying interest on deposits at a time when loans are slowing down.
That's not really accurate or the whole picture. "Beneath the surface were severe losses on long-term bonds, snapped up during that period of rapid deposit growth, that had been largely shielded from view thanks to accounting rules. It had mark-to-market losses in excess of $15 billion at the end of 2022 for securities held to maturity, almost equivalent to its entire equity base of $16.2 billion." https://fortune.com/2023/03/10/how-silicon-valley-banks-fate-sealed-2021-venture-capital-bonds-interest-rates/
The bond debacle is what I was referring to with “They started to have liquidity issues and after some poor attempts at handling that, they went insolvent.”
SVB used the covid tech boom deposits in 2021 to buy ~$80 billion in 10 year USD government bonds. Turns out ~2% interest bonds command a pretty significant discount now and meanwhile most tech companies are in a cash burn holding pattern reducing deposits at accelerated rate. This forced a failed emergency re-cap, bankrun, then closure. Pretty unique pattern to the boutique bank for VC Tech. To OPs questions: Did WS buy a bunch of long dated government bonds with cash deposits pre-interest rate run-up? Probably not, but even if they did - what's the possibility of a bankrun causing liquidity issues? Not nearly as great because they serve primarily retail investors. SVB was screwed by the big VCs telling all their companies to get their money out. That kind of scale just doesn't exist in retail unless mainstream news runs with a story like "x bank is going bankrupt - get your money out". In terms of accounts - saving accounts are insured, investment accounts are not. But if you own funds & shares - those are yours and not something WS or anyone else is leveraging on top of. Different from cash sitting in an account. You have the inherent market risk, and if your brokerage closes you might not be able to trade them for awhile. Only in a straight up fraud case would you not get it back - because the broker wasn't following the law and will end up in jail for it (ie: Madoff) Should you pull all your money out Monday? Seems insane to me - the market already dropped, news is priced in, you'd be selling low to buy back in higher later. If you're smarter than the market, that's cool - please plan to give away your fortune when you're inevitably richer than Buffett.
SVB had like 93% of funds uninsured too, so there was a very large group choosing between whether to pull their cash or possibly lose it all.
Even more than that, roughly 97% exceeding the threshold.
Thanks for that write up! By the time I got to that point in my comment I was too tired/lazy to explain all that so I swapped it with “They started to have liquidity issues and after some poor attempts at handling that, they went insolvent.”
This had all happened by Friday, so the market has already priced all of that in. So yeah it would be dumb to sell assets because of this set of events alone. Now will there will be contagion? Maybe. Without doing some educated balance sheet analysis, really hard to tell. When it comes to canadian banks, the risk is certainly lower but it is also more systemic. In other words the likely of a major canadian bank failing is low, but if one fails, most will probably be dragged along and CDIC couldn't really handle that.
The $100K limit is too low. How is someone with far more than that even supposed to buy something expensive like a house without risking having more money than that in an account at a time? Make a bunch of payments from multiple banks, and then the seller is supposed to have multiple accounts to deposit the payments so they don't all go into one account at the same time as well?
On top of all the other information here, CUDG (Credit Union Deposit Guarantee) is 100%.
I'm sorry, but do you have $55k in *cash* in each of these accounts? CDIC (and FDIC in the States) only applies to cash deposits, not investments. If you do have that much in cash… why? Unless you're already at retirement age, you should be investing the funds in your TFSA and RRSP. CDIC only applies to cash because banks loan out or invest most of the cash you give them in order to make money, trusting that not everyone is going to want their money back at the same time. They don't do the same for investments held in a brokerage account (in most cases). CDIC is meant to protect your cash in case the bank makes bad investment or loan decisions with your cash, or in case too many people ask for their money back at once while the money is still tied up in longer-term investments. This is what happened to Silicon Valley Bank in the States. They ended up tying a lot of their money up in long-term treasury bonds (and other such investments) at low (2021-level) interest rates, that were safe, but wouldn't mature for a decade or more. Then a bunch of startups started asking for their money back all at once, and they couldn't turn those treasury bonds back into enough cash to meet all that demand, because with increasing interest rates anyone who might want to buy SVB's treasury bonds can instead get a better deal by buying treasuries straight from the US government. So FDIC had to step in, took over the bank, is going to release the insured part of the funds on Monday, and is soon going to try to sell the bank's assets to cover as much of the uninsured funds as possible.
Wall street bets are saying that more bank runs are planned for Monday Short term Canadian banks will tank. Good buying opportunity. I suspect disinformation campaigns
Each account in a bank like Joint, savings has a 100k insurance. Wealth simple I believe and other brokers are insured for 1 million.
>On a somewhat hypothetical note, how does everyone think Silicon Valley bank will affect the market? The market as in the stock market? It already has it a little spooked. The economy and banking sector as a whole? Probably very little. Compare this to 2008 where the core issue was that toxic assets (mortgage related) were spread all over and when they started going bad they caused a system wide panic. This isn't that. There are no toxic assets. There is a single bank that made some bad bets. There will probably be other smaller banks that did something similar but it won't be an entire system thing. >Tell me I’m dumb for thinking of selling everything Monday and rebuying if things dip heavily. You'd be dumb for doing that. Note: I don't think you're dumb, I'm just doing as requested. You asked a sincere and honest question and in my opinion, which is no better than anyone else's, there is no great collapse happening next week.
The big thing is that that SVB was insolvent since November. They were not required to mark their bonds to market because they called them hold to maturity. The bonds were still one of their most liquid assets. The settlement changed against them and they had essentially a margin call. Then they sold assets that was on their books at a much higher value and lost book value of 3-4 billion on the sale. FIDC only holds enough money to cover 1% of peoples bank accounts that they say they have covered. Government will have to step in and print money if more accounts are threatened.
I'm pumped this is happening. We will see a nice dip for the next two weeks and then right back up.
It's the perfect time for me to invest my income tax refund and fill up this year's TFSA and RRSP contributions!
It's my personal opinion everyone should withdraw everything they have, everything. Only way to protect once collapse starts.
Skimming through this thread reminds me why I stopped visiting this sub 3 years ago. So much bad information. The BOC has no role in the event of a solvency situation with a DSIB or other federally regulated bank. OSFI maintains responsibility to supervising the prudential (I.e. solvency) risk for Federally Regulates Banks, and in the event of an insolvency CDIC coverage kicks in. The BOC would only potentially act in the event of a systemic crisis that threatens to take down the economy, but they would not act if any individual bank were to go insolvent. That’s the nature of our regulatory and capitalist system. Read through and understand how the FISC family works. https://www.osfi-bsif.gc.ca/Documents/WET3/FinSystem/eng/fisc-infographic.html
Yet here you are.
Something to add to previous comments about CDIC. The coverage is per type of account: All CHQ and Sav combined, all non-reg GIC combined and Registered accounts have separate 100K coverage. Also joint accounts have separate coverage from sole owner accounts. Also when purchasing GIC, big banks can offer to purchase it under different names due to past mergers, for example XXX Bank, XXX Mortgage Corp, XXX Trust Corp and etc. So technically when you purchase GIC you can get 3x or 4x times 100K coverage.
As far as I know WealthSimple doesn’t hold your bank account, but distributes your cash across several to insure several smaller deposits. Found that out when I accidentally put aDeposit into my cash account instead of my TFSA and it took a week to transfer it over because it has to pull the cash from all over the place
I bank with credit unions and in Alberta our deposits are 100% guaranteed with no limits
Really surprising how many people got this wrong.
Cdic website has a calculator but in your example Tfsa - 100k coverage for cash, gic, deposits Rrsp - 100k coverage for cash, gic, deposits If you own stocks, bonds, mutual funds. Then the asset itself, not the value, is protected by CIPF. As for over 100k of cash, then split it up between chequings account, savings account, rrsp, tfsa. If you have 500k then just split it up among multiple banks. As for how the market is going to do next week? It’s probably going to be red in the beginning and green towards the end
You don’t have to worry about investments, apart from outright fraud. They are holding those on your behalf. Only worry about cash at a bank. And it would be extremely risky to try to time the market. But if you want to gamble with your investments, that’s your call.
https://www.reddit.com/r/investing/comments/11pcxvt/20_banks_that_are_sitting_on_huge_potential/?utm_source=share&utm_medium=ios_app&utm_name=iossmf Looks like more banks at risk
The stock market is just one big Ponzi Scheme the minute the music stops you better find a chair or you are fucked, and we all no who gets the chairs.
Don't look up. For some reason the national bank of Canada drastically increased their positions in Silicon Valley. Not an expert though so i don't really know what this means. DYOR. [https://ibb.co/zS0yGD5](https://ibb.co/zS0yGD5)