Thanks, Jean!
March 10, 2023
“This was precipitated by Federal Reserve policies since the 2008 crash (as spelled out in this recent Report), but especially more recently due to the pace and amount of interest rate increases due to the so-called ‘policy pivot.’ Banks simply didn’t have the time to reposition their balance sheets and portfolios. That resulted in mark to market repricing of numerous assets on banks’ balance sheets and a classic maturity mismatch between assets and liabilities. Banks can reclassify some of their available for sale (AFS) assets to held to maturity (HTM) and get some bridge support from the FHLB. However, those actions will be insufficient temporary measures because the yield curve is inverted which is causing depositors to move money out of banks to money market funds and others offering higher rates to savers than the banks, causing depositors to move their money out of banks.
“Ironically, some of that withdrawn depositor money will flow to Wall Street’s too-big-to-fail banks because most believe the Fed will bail them out if they get into trouble. However, the many banks that are not too-big-to-fail (there are only 7 GSIBs), which are thousands of banks in the U.S., do not have that benefit. As a result, contagion is coming because the same dynamic that led to SVB’s failure is going to happen at other non- too-big-to-fail banks unless and until regulators intervene. Of course, that won’t change the yield curve which is the underlying driver and that’s driven by the Fed’s policy of raising rates.
“The Fed’s policies since 2008 have caused instability by decoupling risk from price (as spelled out in this recent Report). It moved rates to zero (and effective negative real rates at times), lowering risk premia across the entire yield curve. The result was a historic debt bubble, much of it locked in at very low rates and often for long terms. The Fed doubled down on this policy when the 2020 pandemic-caused crash hit and then failed to recalibrate and course correct when circumstances changed. As a result, after two years, the Fed had to precipitously change rates policy (the infamous pivot) from autopilot at zero to 450 basis points increase starting in March 2020 (while simultaneously going from QE to QT). Given these unprecedented actions happened over just a few months, banks and the financial system had grossly insufficient time to adjust.
“That’s why SVB is just the beginning. Contagion, likely more bank failures, and various bailouts are almost certainly coming. While the immediate financial stability threats will materialize or be addressed, the underlying fundamental problems caused in large part by the Fed will remain and likely get worse. The Fed’s actions to fight increasing inflation will need to be materially adjusted, which it should be anyway because inflation is driven by many factors that are beyond the Fed’s control. Causing financial instability and a recession (of any depth and length) while missing the mark on inflation should cause a fundamental rethinking of the Fed’s powers, authorities, and role.”
THE NEXT THING ON THE "D" LIST WILL 'PROBLY BE >>>>>>>>>>>>>>
CASH FOR CLUNKERS ~ THE CLUNKERS WILL BE DESTROYED & EVERYONE WILL GET A $10,000 - $20,000 REBATE CHECK AFTER THEY PURCHASE A BRAND SPANKIN' NEW EV!!! LOLOL
"TUFF TITTY" SAID THE GOVERNMENT, TO THE KITTY THAT CAN'T AFFORD ONE!
HAHAHAHAHAHAAAAAAAAA
If the US ever really tried to go completely off of fossil fuels we would go into a severe, never ending depression with only half the food we currently produce.
Average life spans would drop double digits and only the rich people could afford to eat.
It's all a complete fraud based on a fake climate crisis using junk science and junk energy schemes that defy physical laws.
Just these 2 threads on their own expose it!
Life without petroleum based products: 6,000 products made with petroleum. Killing Coal. Fossil fuels and fertilizer. Biden praises high gasoline prices.
https://www.marketforum.com/forum/topic/84689/
Another secret about fossil fuels: Haber Bosch process-fertilizers feeding the planet using natural gas-doubling food production/crop yields. September 2019
https://www.marketforum.com/forum/topic/39215/
I REALLY DON'T THINK THERE'S ANYTHING A "GREENIE" WOULDN'T TRY!
I'M ON THE SAME WAVE LENGTH THIS GUY
More Bank Failures Are Imminent as Liquidity Crisis Exposes Major Problems With the Banks
I found this guy/video to be very credible and extremely informative!
Thanks, Jean!