Posted on 03/20/2023 6:05:18 AM PDT by Kaiser8408a
Its no mystery to me that San Francisco’s First Republic Bank is hurting. Senator Elizabeth Warren (D-MA) is calling for hearings into the banking meltdown. Hey Liz, look at San Francisco’s First Republic Bank as a case study.
The infamous Covid surge in M2 Money supply (green line) produced a big surge in bank price stocks, thanks in part to the insane spending that Congress made following Covid (I’m looking at you, Liz!). But now The Fed is slowing M2 Money growth and banks like First Republic are paying the price.
As The Fed tightens, earnings per share for First Republic (red line) have crashed and burned. Along with its stock price.
So, its not mystery to me what happened. Bernanke and Yellen’s “too low for too long” monetary policies were suddenly taken away to fight inflation (partially caused by Biden and Congress’ spending spree).
Since The Fed has been removing the punch bowl to fight inflation, the S&P 500 index and the KBW bank index have gotten crush. Since February 2nd, the S&P 500 index is down -6.3% while the KBW Bank index is down -31.4%.
In short, banks take in short-term deposits and lend long, earning the spread. But when rates start to rise, watch out!!
(Excerpt) Read more at confoundedinterest.net ...
Imagine if the government did not manipulate yields to create the inverted yield curve and all long term treasury securities were fully discounted in value.
There would be thousands of banks folding instead of hundreds.
Everything controlled by the Left is a disaster
Proof that all the rules in the world don’t mean sh!t.
And the “regulators” ignore the problems.
Psychojawea, blame runaway spending, inflation and the Fed.
Now the government mortgage associations debt, of which $12 trillion is due within 24 months must refinance at interest rates double the rates charged on the 30 year fixed rate 3% to 4% mortgages.
None of their debt that is government guaranteed is included in the national debt of $31.5 trillion. If included, it would double our national debt.
Liz Warren should be indicted for her lying on applications presenting herself as a minority American Indian to secure Federal monies for school and then a position of employment set aside for minorities and garnered her a $400,000 salary.
She is guilty by her own admission.
A balanced budget amendment would send interest rates sharply lower, saving the banks.
I would prefer balanced fiscal year amendment wherein elected federal constitutional officers would become ineligible for government-based employment after their existing terms end.
The moral of the story. Cheating and lying pays handsomely.
And being elected to a federal jobs makes you invincible from arrest.
“$12 trillion is due within 24 months”
Does anybody reading here have a link for that info?
So the Stupid Injun Bitch wants an investigation. What makes her think she’s bright enough to understand a single thing said in testimony? Will she recognize that she is one of those directly responsible for the current state of the economy and the banking crisis? I highly doubt it. If she had an ounce of intelligence and even a bit of shame, she would resign along with everyone who voted for all the massive spending since the ChiCom Virus hit. There’s no chance of that happening.
I thought banks adjusted federal debt holdings to the terms of the CDs they issued.
Trump signed into law every Covid spending bill he was presented with.
Trump authorized paying people $600/week to sit on their couches.
And I have definite problems with that.
YoY! Now twice a day!
When did the government get into the ‘investigation’ racket instead of ‘governing’????
https://capitalmarkets.fanniemae.com/debt-securities/debt-reports/funding-summary
https://capitalmarkets.freddiemac.com/debt/lookup/totalDebtOutstanding
US Treasuries go up to 30 years.
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