Stock Market Wealth

Bailouts Again! The Latest on Incompetent Banks

by | Stock Market Wealth

Everyone Will be Made Whole
(Except the Bankers, for a change)

Okay, so you remember the chart I keep showing you about rate hike / tightening cycles?

If you don’t, here is it:

Courtesy: Zerohedge.com

The FED tightens until those that weren’t ready suffer losses, but the government and the FED don’t care about people and institutions losing money, so in 2022, we saw $35tn in equity wealth (on paper) go to money heaven and we saw companies slowing down spending, freezing hiring or sending thousands of workers home, but what we didn’t see is SYSTEMIC FAILURE.

Until now…

Silicon Valley Bank and Signature Bank have both sounded the alarm that the banking system is reaching its limits and you might be sitting there, thinking to yourself: “Hold on, I thought higher rates are great for banking making loans… they should be having a field day…”

During the insane bubble of 2020, deposits were going through the roof; cash was pouring in and banks used the deposits to make low interest rates loans, because that is their business model, but what did they do with the rest of the cash on hand?

You guessed it; they lent the U.S. Treasury funds… don’t you know? It’s the safest toilet paper a human being can get — 5-star toilet paper.

93% Of Investors Generate Annual Returns, Which Barely Beat Inflation.

Wealth Education and Investment Principles Are Hidden From Public Database On Purpose!

Build The Knowledge Base To Set Yourself Up For A Wealthy Retirement and Leverage The Relationships We Are Forming With Proven Small-Cap Management Teams To Hit Grand-Slams!

    When you give the Treasury department $1,000,000 and get 1% on a 10-yr bond, the interest on the coupon is $10,000 a year. Today, just two year later, the 10-yr bond yields 4%, so just $250,000 are enough to generate $10,000 in interest payments.

    Do you realize the bank that lent $1,000,000 to the government, if it was forced to sell that bond before maturity (before 2030), would take a 75% loss?

    When depositors are rushing to the bank, it must liquidate assets, even if it makes ZERO FINANCIAL SENSE and that is what happened to Silicon Valley Bank!

    I mean, even the Federal Reserve is sitting on insane unrealized losses!

    Courtesy: Bloomberg

    The government and the Federal Reserve are structuring a bailout, but not for the bank and its shareholders (like in 2008), but just for the depositors, who did nothing wrong, expect to expect the 16th largest bank in America to allocate funds responsibly.

    As I write this, gold is SOARING and the markets are well in the green, because what just happened is the FED has been told by the free markets that more rate hikes and you might solve the inflation problem, but the cost will be a depression.

    I hope you have popcorn, because this movie is going for an Oscar nomination.

    Best Regards,

    Lior Gantz
    President, WealthResearchGroup.com

    Governments Have Amassed ungodly Debt Piles and Have Promised Retirees Unreasonable Amounts of Entitlements, Not In Line with Income Tax Collections. The House of Cards Is Set To Be Worse than 2008! Rising Interest Rates Can Topple The Fiat Monetary Structure, Leaving Investors with Less Than Half of Their Equity Intact!

    Protect Yourself Now, By Building A Fully-Hedged Financial Fortress!

      Disclosure/Disclaimer:
      We are not brokers, investment or financial advisers, and you should not rely on the information herein as investment advice. We are a marketing company. If you are seeking personal investment advice, please contact a qualified and registered broker, investment adviser or financial adviser. You should not make any investment decisions based on our communications. Our stock profiles are intended to highlight certain companies for YOUR further investigation; they are NOT recommendations. The securities issued by the companies we profile should be considered high risk and, if you do invest, you may lose your entire investment. Please do your own research before investing, including reading the companies’ SEC filings, press releases, and risk disclosures. Information contained in this profile was provided by the company, extracted from SEC filings, company websites, and other publicly available sources. We believe the sources and information are accurate and reliable but we cannot guarantee it.

      Please read our full disclaimer at WealthResearchGroup.com/disclaimer

      Wealth Video Hub

      Metals Power Play

      TedX Speakers Special: INCOME INEQUALITY – A Socio-Economic Virus! Richard Wilkinson Exclusive

      CHARLES NENNER: My Systems Are Dead-On — 70% CRASH WILL COME!