Just look at what is happening to our banks.
The FDIC’s most recent report tells us that there are 63 “problem banks” in the United States, and collectively our banks now have 517 billion dollars in unrealized losses…
According to the Federal Deposit Insurance Corporation’s first quarter report, the US banking system is sitting on a collective $517 billion in unrealized losses and has 63 “problem banks.”
Those losses have been sparked primarily by a surge in interest rates over the past two years, which have driven down the price of fixed-income securities held by banks.
Unrealized losses held by banks increased by $39 billion in the first quarter relative to the fourth quarter of 2023.
“Higher unrealized losses on residential mortgage-backed securities, resulting from higher mortgage rates in the first quarter, drove the overall increase,” the FDIC said.
I would love to know what banks are on that list.
But the FDIC will not tell us.
As Daisy Luther has accurately noted, the FDIC won’t release that information because they are afraid of bank runs…
We don’t get to know which banks are in trouble.
It could be my bank. It could be yours. Or maybe it’s not.
Are they big banks? Small ones?
The list is confidential to inhibit the likelihood of bank runs finishing off these institutions.
So we just don’t know.
If Americans had the truth, there would be bank runs all over the country tomorrow morning.
That is a rather comforting thought.
And the condition of our banks just continues to deteriorate because mountains of commercial real estate loans are going bad.
At this point, it has become clear that we have never faced a commercial real estate crisis of this magnitude in our entire history…
According to the Mortgage Bankers Association, around $1.2 trillion of commercial real estate debt in the United States will mature over the next two years.
A lot of financial institutions will fail during the months and years that are ahead of us.
Meanwhile, one recent survey discovered that approximately two-thirds of all small businesses in the United States are teetering on the brink of disaster…
Forbes estimates that at least 46% of all employees in the United States, around 61.6 million people in total, are employed by small businesses.
In fact, as Mark B. Spiegel recently discussed, major retailer after major retailer has been reporting disappointing sales numbers…
The U.S. economy seems to finally be cracking. This month a slew of retailers (off the top of my head: Target, Lowe’s, Macy’s, Kohl’s, Best Buy and Foot Locker) reported negative year-over-year sales comps, and that’s before adjusting for the inflation that makes them 3% to 4% more negative in “real” terms. Others (Dollar General and Burlington) reported same-store sales comps in the +2% range, but that too was negative when adjusted for inflation, while Walmart and Nordstrom comps managed to roughly keep pace with inflation, but were unable to exceed it.
At one time, Walmart was an unstoppable retail behemoth.
But now even Walmart is closing down stores…
Our entire system really is crumbling all around us, and as it crumbles we are going to see chaos on a scale that most people don’t even want to imagine.
Already, major cities from coast to coast are being terrorized by theft, violence, drugs, homelessness, gangs and anarchy.
If things are this bad already, what is America going to look like once our leaders completely lose control of the economy?
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