banks

The U.S. deficit and the Treasury bonds which must be sold to fund it are beyond comprehension.

The past year has been all about shifting debt.

The financial crisis drove American homeowners into debt. Homeowners defaulted on their loans (or threatened to), driving the banks into debt. The U.S. government bailed out the banks, shifting debt to the public balance sheet.
Full article at: Debt

More than 700 banks, or nearly one out of every 11, are at risk of going under, according to a government report published Tuesday.

The Federal Deposit Insurance Corp. said that the number of banks on its so-called "problem list" climbed to 702, its highest level since June 1993.

Ben Bernanke is making sure the Fed’s exit strategy goes as easily as a camel can pass through the eye of a needle. Instead of choosing to just sell assets and unwind the amount of securities it holds, the Fed chairman is seeking to be creative once again—as he was in the buildup of its balance sheet--and increase the amount of interest it pays on excess reserves.

An investigation by the nonprofit journalism operation, ProPublica, raises intriguing questions about reasons desperate homeowners are being turned away for the very government program aimed at helping them.

The U.S. Dollar surged against most major currencies as investors sought refuge in lower-yielding currencies following the announcement by China that it was asking banks to curb lending for the rest of the month.

Over the past year, several articles have appeared exactly like this one, and the math never seems to make sense. Does that imply that people are withholding information? Or are the numbers that large that a few billion here or there doesn’t make a difference? I beg to differ about a few billion missing.

February crude oil hugged the $80 price level in overnight trading after a 2.1 percent sell-off in the Tuesday NYMEX day session, but prices sank further after a U.S. Energy Department report revealed a glut of petroleum products.

There have not been this many bank failures since 1992 and the Savings and Loan Crisis. This number is nothing compared to the over 8,000 banks that failed during the Great Depression, but it seems like the failures have been coming at us with more force lately. The irony about all of this important information is that no one seems to be talking about it.

In 1987, when Alan Greenspan began his tenure as Federal Reserve Chairman under President Reagan, each American's share of the national debt was approximately $8,500. Now, 22 years, trillions of dollars, and four presidents later, the national debt per capita has ballooned to nearly five times its previous sum, now totaling about $40,000 per American.

Description: In response to falling asset prices, governments around the globe created trillions of dollars in stimulus spending and rescue funding. In the U.S. alone, the monetary base grew by a trillion dollars in a matter of months.

The collapse of the housing market, and the increase in mortgage delinquencies and home foreclosures, coupled with the credit crisis have all led to a dramatic increase in bank failures over the past few years. When banks fail, the FDIC is appointed as receiver. Depositors are protected up to the FDIC insurance limit.

Investors and political analysts should keep a sharp eye on the congressional assault on Federal Reserve independence.

At the Treasury meeting, I commented that the insurers were better regulated for solvency than the banks. One of the reasons for that is that they do harder stress tests, and they look longer-term.

So, if one is trying to regulate banks for solvency, there are two things to do:

•Set risk-based capital formulas so that few institutions fail.

The rampant bullishness prevading the stock market is raising alarm bells. Today, we are, at best, peering into a nascent economic recovery but Dow Jones Industrial Average have already crossed 10,000 (about 30% off the all time high of 14,198 in October 2007) when peak euphoria reigns amongst investors. If that is not getting ahead of ourselves, I don’t know what is.