Free Republic

While The Who Sang “The Kid’s Are Alright” ,the same can’t be said of banks. It has been nine months since the spectacular and sudden collapse of Silicon Valley Bank. After witnessing three of the four largest bank failures in U.S. history in 2023, the attention of the media and the markets has turned elsewhere. Banking crisis? It is as though it never happened. Having fallen by some 40 percent in March, the NASDAQ Bank Index has recovered to within 15 percent of its high from February. In the last few months, nearly all markets have gone on a bull...

Last summer, I wrote a brief article about how China’s property sector is, structurally, a bubble. And as with all bubbles, policymakers are equipped with a toolkit limited to delaying, mitigating, or perhaps even changing (genco.substack.com/p/the-great-financial-reset-of-2009) the inevitable “burst”. And while Beijing has done a mostly admirable job over the past decade of delaying the debt crisis, a sort-of countdown to D-day has begun.

Are US financial conditions loose as a goose? Despite resilience in US data, 30Y Yields have plunged back below the 4.00% Maginot Line this morning… Source: Bloomberg The last few weeks have seen US macro data reverse its recent trend of disappointment… Source: Bloomberg The long-end of the curve is outperforming… Source: Bloomberg But, ‘do not fight The Fed’ seems to be the narrative and expectations for a March rate-cut are rising once again… Source: Bloomberg And the market is pricing in over 160bps of cuts for next year… Source: Bloomberg Financial Conditions are now at the same level of...

Both the US Federal government and California’s government are facing a fiscal inferno. Thanks to a softening economy and inane fiscal policies. First, let’s begin with banks to illustrate the worsening condition of the economy. Emergency loans from The Fed’s Bank Term Funding Program (BTFP) is on the rise, signaling perceived trouble in the economy. Small banks are suffering more than big banks. Consumer sentiment is below 70 (100 baseline) under Biden and Bidenomics. And then we have Gavin “Gruesome” Newsom and California. California is now facing a $68 billion deficit. It has also defaulted on a $20 billion loan...

The song “Running on Empty” by Jackson Browne comes to mind when analyzing the state of American banking, especially regional banks. Yesterday we found out that inflows to money-market funds continue to be huge ($290BN in six weeks), and more importantly, regional banks’ usage of The Fed’s BTFP bailout facility surged to a new record high (even as regional banks surged… Source: Bloomberg And so, with that shitshow in mind, we await the glorious manipulation of The Fed’s bank deposits data to reinforce that equity confidence. On a seasonally-adjusted basis, banks saw a $53.7BN deposit outflow… Source: Bloomberg However, on...

About 60 credit unions in the US are experiencing outages because of a ransomware attack on an IT provider the credit unions use, a federal agency said Friday. The National Credit Union Administration (NCUA), the agency that insures deposits at federally insured credit unions, said in a statement to CNN that it was “coordinating with affected credit unions” in the wake of the hack. The full extent of the outage and its impact on credit unions was unclear Friday evening. One of the affected credit unions, New York-based Mountain Valley Federal Credit Union, said that technicians from the hacked IT...

Ten banks in the United States are working with the New York Innovation Center (NYIC), part of the Federal Reserve, to test the regulated liability network (RLN), a digital currency platform that will replace cash. RLN would use distributed ledger technology to improve financial settlements and would include commercials and central banks, the firm said earlier this month.

Ten members of the banking community are working with the New York Innovation Center (NYIC), which is part of the Federal Reserve Bank of New York, to explore the feasibility of the regulated liability network (RLN) — an interoperable digital money platform. The proposed RLN would use distributed ledger technology to improve financial settlements and would include central banks, commercial banks and regulated non-banks, the participating firms said Tuesday (Nov. 15) in a press release. “The 12-week PoC [proof of concept] will test a version of the RLN design that operates exclusively in U.S. dollars where commercial banks issue simulated...

DENVER (KDVR) — Some people are not getting their paychecks Friday due to a banking system issue. Deposits are reportedly delayed at multiple banks across the U.S. The Federal Reserve is reporting an issue with the Automated Clearing House, which is the primary system agencies use for electronic funds transfers. Customers of Bank of America, Chase, U.S. Bank, Wells Fargo and other banks have been reporting issues with deposits on X, formally Twitter, and Downdetector. Both Chase and Bank of America gave statements to CNN, confirming that some deposits may be delayed. The Fed reported a batch of transfers had...

The San Francisco Chronicle reported Tuesday: Bank branches are vanishing across the country, and San Francisco is having a record-testing year. Twenty branches shuttered across the city through Oct. 28, according to data from the U.S. Office of the Comptroller of the Currency. The closures — from the central Richmond District in the west to Mission Bay in the east, from Fort Mason in the north to Bayview in the south — add up to more than the previous two years combined and represent the most in a single year since at least 2000. … All over California, 277 bank...

The Biden administration has warned U.S. banks and other financial institutions that they can't reject illegal immigrants' credit applications based solely or predominantly on their immigration status.The Department of Justice (DOJ) and the Consumer Financial Protection Bureau (CFPB) said in a recent statement that rejecting illegal immigrants for credit cards and various types of loans just because they are noncitizens is unlawful.The two agencies stated that they were issuing the warning "because consumers have reported being rejected for credit cards as well as for auto, student, personal and equipment loans because of their immigration status, even when they have strong...

The Biden administration released a statement Thursday warning financial institutions against using a person’s immigration status in credit applications. The Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) released a joint statement telling financial institutions that while it is not illegal to consider a person’s immigration status in the decision on whether to lend money, an overreliance on it could run afoul of the law, according to the statement. The statement implicates the Equal Credit Opportunity Act (ECOA), which makes it illegal to discriminate on the basis of race, color, religion, national origin, sex and more in...

Greg Beckett, a 46-year-old executive at Wells Fargo, jumped to his death in an apparent suicide from the office boardroom on the 14th floor at the company’s headquarters in Wilmington, Delaware, authorities have revealed. Though Beckett, from Bridgeport, New Jersey, took his own life back in January, new details have been revealed what led up to his death, according to a new report. His family reportedly said Beckett was under immense stress and pressure from his job and had been responsible for safeguarding Wells Fargo's risk exposure, the Daily Mail reported.

JPMorgan Chase admitted to pressuring the financial software company Intuit into preventing gun sellers from using the company’s payment processing services, according to a letter Sen. Ted Cruz sent Monday after looking into the policy. Bank of America, meanwhile, denied pressuring Intuit into banning gun manufacturers from using its famous QuickBooks software. “Woke big banks are increasingly weaponizing their power to cut off law-abiding businesses from accessing banking services,” Cruz, R-Texas, told The Daily Signal in an email statement Monday. [snip] Intuit, the financial software company best known for producing QuickBooks, had adopted an acceptable use policy previously listing “guns...

A group of academics have conducted a study that found that during the fastest pace of Fed interest rate hikes in 40 years, the majority of U.S. banks failed to hedge their interest rate risk. The report’s findings include the following: “Over three quarters of all reporting banks report no material use of interest rate swaps.” “Only 6% of aggregate assets in the U.S. banking system are hedged by interest rate swaps.” “Banks with the most fragile funding – i.e., those with highest uninsured leverage — sold or reduced their hedges during the monetary tightening. This allowed them to record...

What a mess Biden and his Progressive backers have made. And we are forced to suffer the consequeinces of his policies. Or follies! Money-market funds saw inflows for the 7th week of the last 8 with a $42BN jump (the most in 2 months) to a new record high of $5.625TN… Source: Bloomberg The inflow was dominated by a $24BN increase in Institutional fund assets while Retail also saw a sizable $17.7BN increase… Source: Bloomberg And the divergence between money-market fund assets and bank deposits continues to grow… Source: Bloomberg And while we actually saw huge deposit outflows (on a...

Soviet Joe Biden, who is a believer in Soviet-style command economies where rather than rely on free market capitalism, we now have CC (Crony Communism) running the US economy. Into the ground. But in the tradition of bad Federal policiies, Soviet Joe and Energy Secretary Granholm (with help from Congress) mandate green energy transition at all costs, watch the auto industry suffer, then bail them out. Sounds a lot of like the banking crisis of 2008 where The Federal government pushed homeownership until it helped almost collapse the banking sector, then the Federal government bailed out the banks. Rinse, repeat,...

Did Bank of America discriminate against a Tennessee ministry over its Christian views or was it simply a business matter? Steve Happ, board member and founder of Indigenous Advance, a Memphis-based charity that, along with Indigenous Advance Customer Center LLC, has partnered with and served indigenous people in Uganda since 2015 to provide basic needs and share the Gospel. Despite holding deposit and credit card accounts with Bank of America since its inception, Indigenous Advance received a series of letters in April in which the bank announced it was closing the group’s accounts within 30 days. According to the nonprofit...

A Christian ministry claiming it was "debanked" by Bank of America filed a consumer complaint this week to Tennessee Attorney General Jonathan Skrmetti to determine whether their accounts were closed due to religious discrimination. Indigenous Advanced Ministries – a Memphis, Tennessee-based nonprofit engaged in charitable efforts for orphaned children in Uganda through various partnerships – was warned without explanation by Bank of America in April that the organization was "operating in a business type we have chosen not to service at Bank of America" and would be closed within 30 days. In May, Bank of America sent another letter stating...

Aug 15 (Reuters) - An analyst at Fitch Ratings warned that U.S. banks, including JPMorgan Chase (JPM.N), could be downgraded if the agency further cuts its assessment of the operating environment for the industry, according to a report from CNBC on Tuesday. In June, Fitch lowered the score of the U.S. banking industry's "operating environment" to AA- from AA, citing pressure on the country's credit rating, gaps in regulatory framework and uncertainty about the future trajectory of interest rate hikes. Another one-notch downgrade, to A+ from AA-, would force Fitch to reevaluate ratings on each of the more than 70...