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As the war in Ukraine drags on into its second year, protest demonstrations have been taking place in major European cities. They express the growing sentiment that the people are tired of the protracted conflict and fearful of what could come should the war continue even longer.
Since the 1970s it’s been virtually impossible for a country to function without access to US dollars. And Washington maintained this highly-favorable status quo by putting various kinds of pressure — from sanctions to election theft to outright invasion — on anyone who stepped out of line.
In his 1884 article “Mind as a Social Factor,” Lester F. Ward attacked the laissez-faire doctrine in an “inversion of values” that would have made Friedrich Nietzsche blush. “But how shall we distinguish,” Ward asked, this human, or anthropic, method from the method of nature?
FDIC Weighs Squeezing Big Banks To Plug $23 BIllion Hole From Small Bank Failure CostsMar 29, 2023 - 12:35:05 PDT
Yesterday, we explained that the reason why the stock price of First-Citizens Bank & Trust exploded on Monday after the FDIC revealed that it would "acquire" much of the now failed Silicon Valley Bank, is because in exchange for paying $500 million to the FDIC, the Raleigh, N.C. bank would not only get $16.5 billion in clean assets, but would also get a taxpayer backstop for future losses to boot.
Mar 29, 2023 - 12:33:51 PDT
President Biden remains underwater in his overall job approval rating and his ratings on the economy, foreign affairs, energy and the environment.
It’s not just the credit markets that are sending out a signal of distress. A key barometer that the Fed watches, the St. Louis Fed Financial Stress Index, is telegraphing a similar message about the state of the US economy.
By now everyone knows that small banks - which have little to no capital markets exposure and are almost entirely reliant on NIM and debt transformations courtesy of their balance sheets in many cases with catastrophic results - are hanging by a thread and all it takes is one (alleged) tweet for deposits to be drained from bank XYZ, sending the bank into the waiting arms of the FDIC within hours...
Mar 29, 2023 - 10:52:21 PDT
A former U.S. Treasury official has warned of “catastrophic” consequences if the U.S. dollar loses status as the world’s reserve currency.
THE US dollar has lost some of its lustre over the winter. The twin supports of its status as the preferred haven during the pandemic and being backed by the world’s strongest economy are fading. And now another prop for the greenback is wobbling, amid doubts about how much higher the Federal Reserve will raise US interest rates as it has second thoughts on the likelihood of a recession. The greenback looks likely to suffer an extended bout of weakness.
Superpowers like Russia and China are eyeing America’s financial vulnerabilities while the Fed, Congress, Treasury, and Wall Street play musical chairs..
Riyadh Joins Shanghai Cooperation Organization as Ties With Beijing GrowMar 29, 2023 - 08:22:13 PDT
Saudi Arabia's cabinet approved on Wednesday a decision to join the Shanghai Cooperation Organization, as Riyadh builds a long-term partnership with China despite U.S. security concerns.
Xi: "Changes" Are Coming After 100 years
Banking Crisis Threatens to Ignite Credit Crunch for US Households: RickardsMar 29, 2023 - 08:12:29 PDT
Strategic Intelligence editor Jim Rickards discusses the Fed's decision to raise rates by 25 basis points, arguing that policymakers are "determined" to get inflation under control.
The U.S. is not yet experiencing a Minsky moment but certainly our economy is characterized by Minsky’s “Ponzi finance” where existing debt requires more credit just to pay for interest on that debt. To be specific total credit -- now approaching 85 trillion -- requires credit growth of perhaps 4 trillion annually just to steady GDP at the current 26 trillion. That’s possible but it requires lower interest rates not higher.
Lenders probably aren’t going to be buying many mortgage bonds, which could put upward pressure on mortgage rates.
In a tumultuous few days, the crypto giant raised fees, suffered software issues and faced a regulator lawsuit.
Representatives from the FDIC, the Board of Governors of the Federal Reserve System, and the Undersecretary for Domestic Finance, were questioned.
DBS Group Holdings Ltd.’s digital banking and payment services were restored after an outage that lasted about 10 hours, in a throwback to more than a year ago when Southeast Asia’s biggest bank faced one of its worst tech outages.
The Fed Just Erased 5 Months of Qt in Two Weeks and That Should Only Add Fuel to the Inflation FireMar 29, 2023 - 07:38:22 PDT
Meanwhile: Used car prices increased again for the 5th month in a row. Prices continue to firm up at historical levels, despite being down about 2% on a year-over-year basis. Inflationary forces remain stubbornly high due to structural macro drivers.
When Signature Bank of New York was taken into receivership this month, depositors as far away as Arkansas, Georgia and Ohio took fright. That’s because there are four Signature Banks in the US, and customers weren’t immediately sure which one was in trouble.