Posted on 11/22/2023 9:29:10 AM PST by EBH
Three US banking giants have just had their ratings downgraded to “negative” by Moody’s.
Moody’s Investor Service downgraded JPMorgan Chase, Wells Fargo and Bank of America to negative ratings after previously classifying them as stable, MarketWatch reports.
Analyst Peter E. Nerby of Moody’s said that the worsening outlook on bank debt was due to “the potentially weaker capacity of the government of the United States of America (Aaa negative) to support the U.S.’s systemically important banks.”
In particular, JPMorgan’s downgrade was partially because the bank runs a “complex” capital markets business that may post “substantial” risks to its creditors.
A potential upgrade for JPMorgan “would depend on sustaining strong and stable performance and capital levels” above its competitors, Moody’s says.
Despite the downgrade from Moody’s, all three banks’ stock prices are in the green for November, so far.
The agency also said that the downgrade of the banks’ ratings was in line with a previous downgrade of U.S. sovereign credit rating, which was also bumped down from stable to negative.
In a research note released last quarter, Moody’s said that US banks were facing “significant risk” of deposit flight due to interest rate and asset-liability management (ALM) risks.
Moody’s, which controls 80% of the global ratings industry along with Standard & Poors
(Excerpt) Read more at dailyhodl.com ...
When this collapse happens, it will make 2008 look like child’s play.
Downgrades happening all around...
Bidonomics ....? This is nuts.
How long before Moody’s executives are raided by the FBI and/or the IRS?
Because it’s obvious. Their minds just aren’t right.
WWIII will save us…
this trip down is going to be wild...and not wonderful
I was concerned before
Now I am getting really scared.
Everything is not alright
Most assuredly the federal government has less capacity to intervene with help for the big banks, should they falter, because the federal government has too too much debt problems of its own, with particular thanks to Joe Biden.
The US government has proven they can have infinite deficits if needed to bail out the big banks.
When you have a Federal Reserve bank in your basement there are no rules.
Reverse Repo Draining Fast! What Happens When It’s Gone?
The Reverse Repo has been quietly injecting money into the bond market since the debt ceiling was suspended in June. There is now just $912B remaining, down from nearly $2.3 trillion just a few months ago. Now the question on everybody’s mind, what happens when it gets to zero? Joe Brown from @HeresyFinancial joins me to talk about what happens next.
https://youtu.be/bTNFLD0w4s4?si=u0XQKBGY4Mkw8ydO
Excellent Joe Brown video—thanks.
He and I agree—he just explains it better.
;-)
Don't here the media talking about this aspect of Bidenomics.
So what?...Why worry? SVB, Signature, First Republic depositors were protected by the likes of the BFTP etc. weren't they?
This is the official position held by the Alfred E. Neuman institute for Fiscal Stupidity.
Rut Roh
I have a significant amount deposited in one of those banks (decline to say which), and I don’t know how to withdraw it because of the disgusting withdrawal limit mandated by the government.
I agree it is a great interview and explanation of why we should be very concerned.
See post #8
While I agree that the FDIC will bail out depositors—even above the 250K limit as we have seen in the past year—there is a risk for bank stock (equity) holders.
That is the basis for the lower rating.
Most banks are technically insolvent if they had to liquidate everything immediately. In fact many have commercial real estate liability alone that substantially exceeds their total equity.
I take it you are talking about ACH transfers from your bank account to a different bank that you have an account with. Banks are able to set their own transfer out limits. If your money center bank has draconian transfer out limits, write a paper check. Before the financial crisis hit in 08, I was ping ponging money between a money center bank(MCB) and my CU for better CD rates. Then out of the blue the MCB put a $2K limit on transfers out about 6 months before the financial crisis hit. That ticked me off. I had to drive 100 miles to the nearest MCB branch office to close out my account. I wasn’t in any danger of exceeding the FDIC insurance limit. It just smelled bad, and I was right..
But, but, but... Biden does NOT want America first...He wants us last. Only the people who hate our country matter to President Sniffer.
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