The Down Range Forum
Member Section => Politics & RKBA => Topic started by: 2HOW on April 20, 2009, 10:05:36 AM
-
Sunday, April 19, 2009
LEAKED! Bank Stress Test Reults !
The Turner Radio Network has obtained "stress test" results for the top 19 Banks in the USA.
The stress tests were conducted to determine how well, if at all, the top 19 banks in the USA could withstand further or future economic hardship.
When the tests were completed, regulators within the Treasury and inside the Federal Reserve began bickering with each other as to whether or not the test results should be made public. That bickering continues to this very day as evidenced by this "main stream media" report.
The Turner Radio Network has obtained the stress test results. They are very bad. The most salient points from the stress tests appear below.
1) Of the top nineteen (19) banks in the nation, sixteen (16) are already technically insolvent.
2) Of the 16 banks that are already technically insolvent, not even one can withstand any disruption of cash flow at all or any further deterioration in non-paying loans.
3) If any two of the 16 insolvent banks go under, they will totally wipe out all remaining FDIC insurance funding.
4) Of the top 19 banks in the nation, the top five (5) largest banks are under capitalized so dangerously, there is serious doubt about their ability to continue as ongoing businesses.
5) Five large U.S. banks have credit exposure related to their derivatives trading that exceeds their capital, with four in particular - JPMorgan Chase, Goldman Sachs, HSBC Bank America and Citibank - taking especially large risks.
6) Bank of America`s total credit exposure to derivatives was 179 percent of its risk-based capital; Citibank`s was 278 percent; JPMorgan Chase`s, 382 percent; and HSBC America`s, 550 percent. It gets even worse: Goldman Sachs began reporting as a commercial bank, revealing an alarming total credit exposure of 1,056 percent, or more than ten times its capital!
7) Not only are there serious questions about whether or not JPMorgan Chase, Goldman Sachs,Citibank, Wells Fargo, Sun Trust Bank, HSBC Bank USA, can continue in business, more than 1,800 regional and smaller institutions are at risk of failure despite government bailouts!
The debt crisis is much greater than the government has reported. The FDIC`s "Problem List" of troubled banks includes 252 institutions with assets of $159 billion. 1,816 banks and thrifts are at risk of failure, with total assets of $4.67 trillion, compared to 1,568 institutions, with $2.32 trillion in total assets in prior quarter.
Put bluntly, the entire US Banking System is in complete and total collapse.
More details as they become available. . . . . .
UPDATE 0147 HRS EDT Monday, April 20, 2009 --
For those who may be skeptical about the veracity of the stress test report above, be reminded that only last Sunday, April 12, this radio network obtained and published a Department of Homeland Security (DHS) Memo outlining their concerns that returning US military vets posed a domestic security threat as "right wing extremists." That memo, available here, is marked "FOR OFFICIAL USE ONLY" and contained strict warnings that it was not to be released to the public or to the media. We obtained it and published it days before other media outlets.
That DHS report appeared on this blog at least two full days before the story was picked up by The Washington Times, and virtually every other US media outlet.
Details of certain aspects of the stress test reported above have now been CONFIRMED through REUTERS News service when they disclosed the risk-capital percentages publicly on April 6, 2009 at this link
Further, todays Wall Street Journal (April 20, 2009) is confirming at this link that lending by the largest banks has DECREASED 23% since the government began the T.A.R.P. program, causing many in Congress to ask where the money has actually been going. Apparently, it has been going into propping-up the failing banks instead of out in loans to the public.
Additional details and proofs are forthcoming. . . . . continue to check back on this developing story.
Posted by HalTurnerShow.com at 10:32 PM
-
The banking system is a house of cards, that has been supported by both the Republicans and Democrats, and by extension the American people in general. When, not if this house of cards comes tumbling down, it will take you and me with it. It was a nice ride while it lasted, now it's time to pay the piper.
-
The secret to the housing crisis and banking problems is that it is based on deflating values. Nothing will colapse unless payments are stopped. If the Feds would step in and freeze the variable interst rates (on both sides) and maybe underwrite those already in cashflow binds due to earlier increases; if they would require people to continue to pay what they can afford (bankruptcy means adjusted payments rather than a get out of a mistake free card); and if they would not declare institutions insolvent based off paper losses; we would be taking giant strides toward shoring up this problem.
I know that this is only scratching the surface, and it is overly simplistic, but it is a basic start. I have seen people who's only problem with their mortgage is that they went in to refinance to get a lower interest rate, and they found that their equity was depleted due to lower values. They were having no problem with their old mortgage, and they only wanted to take advantage of lower interest rates. Due to the new info in their hands they are now discouraged and trying to sell off the house before it loses more value (which causes its value to further drop) and they are now on a watch list at the bank. Relax ... live in your home ... that is why you bought it in the first place ... pay your bills like you have been and can continue to ... and soon everything will be just fine again.
We either need to start using common sense or passing out the "chicken little" buttons for everyone to wear.
-
Commentary On The Capital MarketsMonday, April 20. 2009
Posted by Karl Denninger in Editorial at 11:03
(Page 1 of 302, totaling 904 entries) » next page
Economics "Professor" Advocates Theft
What sort of crap is this?
Imagine that the Fed were to announce that, a year from today, it would pick a digit from zero to 9 out of a hat. All currency with a serial number ending in that digit would no longer be legal tender. Suddenly, the expected return to holding currency would become negative 10 percent.
That move would free the Fed to cut interest rates below zero. People would be delighted to lend money at negative 3 percent, since losing 3 percent is better than losing 10.
No, people would immediately go to the closet and retrieve their shotgun, load it, and proceed to use it on the party or parties that declared their intent to randomly destroy their money.
This is the sort of "justification" that Mankiw uses for such a concept (note that the actual idea was floated by one of his "students" as a means to implement his insanity):
Of course, some people might decide that at those rates, they would rather spend the money — for example, by buying a new car. But because expanding aggregate demand is precisely the goal of the interest rate cut, such an incentive isn’t a flaw — it’s a benefit.
No it's not.
Americans have tolerated a silent form of this theft for a long time, born out of the intentional provision of excess liquidity to prevent the incompetent and even fraudulent lending and borrowing by both private interests and government from having to be faced.
This has resulted in the mathematical laws of exponents running far further than it ever should have - a path that began in earnest after the 1987 market crash and has continued ever since.
Call it a conspiracy if you want, call it bad judgment, call it criminal fraud and looting. But so far, this form of theft and deception has been hidden under the guise of alleged "prosperity" - even though it was in fact nothing more than leverage laid upon leverage, debt laid upon debt.
In the 1960s, 70s and early 80s Americans didn't have much household debt. They had put down 20% or more on their homes and if they bought a car on credit it was usually done on a four year loan and only for their primary vehicle - if they owned more than one car the other was usually paid for and owned free and clear. When Americans went to the store to buy something, whether it be groceries, a frying pan, a lawn mower or TV they whipped out the checkbook and paid for it - in cash.
All of this changed in the 1980s. Credit cards were marketed to everyone, including those who clearly couldn't manage credit to save their own lives. If you wanted a new car you got one - even if you owed a bunch on your present car - by rolling over that debt into the new loan.
The alleged "prosperity" was, for most Americans, false. Oh sure, there were people who really did prosper. There were and are people who were prudent. Who lived below their means. Who saved. Who invested.
Now Mankiw proposes to steal that money too to prop up that which is mathematically impossible to sustain:
Having the central bank embrace inflation would shock economists and Fed watchers who view price stability as the foremost goal of monetary policy. But there are worse things than inflation. And guess what? We have them today. A little more inflation might be preferable to rising unemployment or a series of fiscal measures that pile on debt bequeathed to future generations.
We cannot continue to play this game Greg. The mathematics are never wrong. The scam has been run to not only its natural concluding point but has been pressed well beyond it. You and your ilk through America's so-called "elite institutions of economics" have pressed economic, monetary and fiscal policies that are intellectually and mathematically bankrupt.
There is no solution that leads to sustainable prosperity for the country other than deflating the excessive debt - which means deflating prices for capital goods, most particularly real estate, to sustainable levels and defaulting the debt that cannot be serviced.
Having gotten caught by the immutable laws of mathematics you and others, including Bernanke, have now turned to obfuscation, lies and proposals to steal in broad daylight as your level of panic over being held to account for the putrid insanity of the previous 30 years becomes apparent to all.
You, sir, need to be fired - along with your entire department.
-
M58:We either need to start using common sense or passing out the "chicken little" buttons for everyone to wear.
The sky is in fact falling, it's time to wake up and smell the imminent depression.
-
Yes :(
-
I'm not sticking my head in the sand and saying it ain't going to happen. What I'm saying is that the only reason it is going to get worse than it is is because of the hype being spewed by the media, the panic by the masses that listen to them, the way our government handles it, and the way we let ourselves get sucked into the government "solution."
Keep paying your bills the best you can, don't spend on what you can't afford, save when you can, and be prepared. This isn't new advice. This is the way wise people have lived for centuries. This is what the people get rich during every economic down turn do in their everyday lives.
By the way: The auto is supposedly in shambles because no one is buying cars because of credit issues. Our business typically buys year old, mid mileage vans. The cost of these vans has increased $2,000 over the last five months! I asked the dealer (my uncle) if the reason was because no one is buying new and going with used instead ... Get ready for this ... "It is true, but not for the reason everyone thinks. The demand is skyrocketing for used because they have cut back on manufacturing. This is a manufacturer created problem. We can't get the new ones." He went on to explain that since the first of the year over 75 of the used vehicles that have gone off their lot were to people that paid cash difference and that wanted new.
-
I'm not sticking my head in the sand and saying it ain't going to happen. What I'm saying is that the only reason it is going to get worse than it is is because of the hype being spewed by the media, the panic by the masses that listen to them, the way our government handles it, and the way we let ourselves get sucked into the government "solution."
Keep paying your bills the best you can, don't spend on what you can't afford, save when you can, and be prepared. This isn't new advice. This is the way wise people have lived for centuries. This is what the people get rich during every economic down turn do in their everyday lives.
By the way: The auto is supposedly in shambles because no one is buying cars because of credit issues. Our business typically buys year old, mid mileage vans. The cost of these vans has increased $2,000 over the last five months! I asked the dealer (my uncle) if the reason was because no one is buying new and going with used instead ... Get ready for this ... "It is true, but not for the reason everyone thinks. The demand is skyrocketing for used because they have cut back on manufacturing. This is a manufacturer created problem. We can't get the new ones." He went on to explain that since the first of the year over 75 of the used vehicles that have gone off their lot were to people that paid cash difference and that wanted new.
This is not a manufacturer created problem. I have been in the retail auto business since 92 and most recently the last 5 years with Ford. We have seen large dealers go out of business in Knoxville, including KIA, FORD, Chevrolet and Nissan. When your lenders tell you they will not look at an application from a retail customer unless they have a 750 credit score along with cash down and work history and income verified along with personal references and no negetive equity in the deal you cannot sell cars. Our dealership went from 100+ cars a month to 20 a month. Thats why Im sitting here . Lots are overloaded with inventory and many new vehicles have had a birthday sitting on lots. With floor plan costs rising and profits falling the only money being made by dealers are parts and service and body shop revenues. There is no profit in selling a new vehicle. And the used market is very strained.
-
I'm obviously in a very isolated part of the country. Our community is plugging along, whining about the horrible economy, but not showing the effects. Our dealer is selling cars near his last year record rate and slightly above long term average, our manufacturing is following traditional trends - all except for one which is expanding, our businesses are not complaining about bad debts or excessive downturn in cash flow, and our citizens are paying their utility bills (I'm on the utility commission and this was our best winter in the six years I've been on for winter deliquensies).
I'll just go back in my little corner here and keep living my life.