One of Wall Street’s most bearish skeptics told Business Insider last month that he thinks the “worst market crash since 1929” is coming.For years, our leaders have been “kicking the can down the road”, but according to Spitznagel all of that intervention has set the stage for an absolutely epic collapse…
In an interview with New York Magazine’s Intelligencer last year, Spitznagel likened the Fed’s “constant monetary intervention” to forest fire suppression. He went on to say “when you suppress it enough, it gets to a point where you can no longer afford to have any fires burn because they would be too big and too intense.” That’s where the U.S. economy is at, according to the hedge fund manager. If Spitznagel’s dire market predictions come true, you really don’t want to have all of your eggs in one basket — because that basket could easily go up in flames.In the months ahead, we will want to keep a very close eye on our banks. Our banks are the beating heart of our economic system, because without the banks we would not have a functioning economy. The banks are where we get mortgages to buy homes, auto loans to buy vehicles, and credit cards to go on shopping sprees. Without the credit they provide, we would be in a world of hurt. Unfortunately, our banks are in very serious trouble right now. Higher interest rates have blown a hole that is hundreds of billions of dollars wide in their balance sheets. And they are sitting on mountains of commercial real estate loans that are going bad because the value of commercial real estate has collapsed all over the nation. One consulting firm that examined data from approximately 4,000 U.S. banks is warning that hundreds more banks could potentially fail during this crisis…
According to recent reports, hundreds of banks face the potential of failing just like Republic First Bancorp. Consulting firm Klaros Group analyzed roughly 4,000 U.S. banks and found that the banks face a threat of losses due to “secular changes in social patterns accelerated by the COVID pandemic (such as work-from-home, which has materially impacted demand for office space) and to the impacts of higher interest rates and related inflation.” “You could see some banks either fail or at least, you know, dip below their minimum capital requirements,” Christopher Wolfe, managing director and head of North American banks at Fitch Ratings told CNBC in an interview.Meanwhile, we continue to get even more signs that the overall economy is really slowing down. Read more at: TheEconomicCollapseBlog.com
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