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Mar 20, 2023 - 11:17:16 PDT
Every time there is a banking crisis some scratch their heads and wonder; how could this happen? Surely it must be greed, bad risk management or lack of regulation. More intervention should solve it. However, all those excuses miss the most critical point: The U.S. banking system was destroyed by design, and the big banks played along with it.
This past weekend saw extraordinary actions by the Fed to address the meltdown of Silicon Valley Bank. Did the central bank break the law by effectively authorizing unsecured loans to banks based on the face value—rather than significantly lower market value—of those banks' Treasury holdings?
“There’s an old saying: Whenever the Fed hits the brakes, someone goes through the windshield,” said Michael Feroli, chief economist at J.P. Morgan. “You just never know who it’s going to be.” (The New York Times, March 16, 2023)
Mar 20, 2023 - 08:21:17 PDT
During a recent appearance on Chicago's Morning Answer, Christopher Whalen, an investment banker, chairman of Whalen Global Advisors LLC, and editor for The Institutional Risk Analyst, discussed the present state of the banking industry.
In March 2014 the world’s oldest central bank, the Bank of England (BoE), did every advocate of sound money a big but unintentional favor by publishing an official introduction to and an official detailed account of unsound money.
There are many excuses often used to explain inflation. However, the fact is that there is no such thing as “cost push inflation” or “commodity inflation.” Inflation is not an increase in prices, it is the destruction of the purchasing power of the currency.
How should Congress assess the Federal Reserve’s track record as an investor in residential mortgage-backed securities (MBS)? Regardless of Fed spin, it merits a failing grade. The Fed’s COVID-era intervention in the mortgage markets fueled the second real estate bubble of the 21st century.
Mar 20, 2023 - 08:15:43 PDT
Undun. The Fed’s balance sheet, that is. For all the focus on whether the Federal Reserve is about to pause its interest-rate hikes, there’s another critical policy decision sure to…
Putin Tells Xi He's "Open To Negotiating Process" On Ukraine As US Says Ceasefire "Unacceptable"Mar 20, 2023 - 08:14:33 PDT
Update(1017ET): What's being described as an initial, informal meeting between Presidents Xi and Putin is underway at the Kremlin. While the expected cordialities and expressions of closer relations were exchange, among the most notable early statements came from Putin, who said he's "open" to peace talks with Ukraine and China's mediation efforts.
Bloomberg reported that Amazon sent an internal email notifying its employees about an upcoming wave of layoffs, which is part of the company's continuing strategy to reduce costs amid mounting macroeconomic uncertainty.
There has been a surge in protests and strikes around the world, primarily focused on economic hardships, skyrocketing inflation, political turmoil, and geopolitical issues.
It’s the weekend, but our fresh Financial Crisis does not sleep. And a recent study says we’ve only seen the tip of the iceberg.
Mar 20, 2023 - 07:41:21 PDT
Robert Kiyosaki, investor and "Rich Dad, Poor Dad" author, has issued a warning about the state of inflation in the US.
The Wolf Street Report: Free Money Turned Brains to Mush. Now Some Banks FailMar 20, 2023 - 07:30:51 PDT
The Fed ended Free Money, and the only thing it broke is the consensual hallucination that spawned during the Free Money era. And look what we got.
Mar 20, 2023 - 07:29:57 PDT
Its Gov’t Gone Wild! Insane spending budget by “Sloppy Joe” Biden, Yellen asking Warren Buffet for banking advice (seriously??), a war in Ukraine that America doesn’t seem to actually want to win, etc. But its the banking system where banks are getting crushed by rising inflation and interest rates (but failed to hedge). Sigh.
Mar 20, 2023 - 07:28:43 PDT
The infamous Covid surge in M2 Money supply (green line) produced a big surge in bank price stocks, thanks in part to the insane spending that Congress made following Covid (I’m looking at you, Liz!). But now The Fed is slowing M2 Money growth and banks like First Republic are paying the price.
Mar 20, 2023 - 07:26:13 PDT
Despite endless promises from Washington DC that there would never be another bank bailout, the Biden Administration bailed out Silicon Valley Bank (SVB) by removing the $250,000 cap on deposit insurance. Then Treasury Secretary Janet Yellen added that in the future, only banks that posed SYSTEMIC RISK to the economy will be bailed out. Translation: only the big four Too Big To Fail (TBTF) banks will be bailed out. Meaning that the Biden Administration prefers big banks to community banks.
Mar 20, 2023 - 07:24:24 PDT
The WSJ wants to send long-range missiles to Ukraine, Lindsey Graham discusses WWIII, and Republicans want defense spending to rise 5 percent more than inflation.
Mar 20, 2023 - 07:23:39 PDT
Please consider these Statement by Christine Lagarde, President of the European Central Bank, on the announcement on 19 March 2023 by the Swiss authorities
Mar 20, 2023 - 07:22:28 PDT
"We welcome the announcements by the Swiss authorities today to support financial stability. The capital and liquidity positions of the U.S. banking system are strong, and the U.S. financial system is resilient. We have been in close contact with our international counterparts to support their implementation."