Comment by pjc50
7 hours ago
Basel capital rules are supposed to mitigate against the insane idea of banks deploying all their capital in a single high risk stock.
If you think you can get all the _public_ to pull their short term bank deposits into stock .. well, (a) you've not met the Germans, and (b) that is how the economy of Albania collapsed in a pyramid scheme.
> Basel capital rules are supposed to mitigate against the insane idea of banks deploying all their capital in a single high risk stock.
At the same time of these companies IPO'ing, they are also trying to bend the rules of the index funds and their markets (Nasdaq,S&P 500) so that they can get listed into these index funds asap.
And when these happens at such obscene levels, what happens is that a very sizable chunk of the S&P will get into these companies (5-10% is a very large number for a single company especially such companies within these index funds IMO)
and their whole plan is that then banks and other investments sitting on cash would then invest in it. Oh by the way, your retirement funds might also be linked to it all.
The fact is that there is a race with multiple companies (SpaceX,Anthropic,OpenAI) all trying to IPO and get listed on the stock markets as soon as possible.