Second Largest Bank Failure in U.S. History…

[smokingman]

I'll be curious to see how long before building code revision allows commercial real estate to be rented out for migrant housing. With the stroke of a pen properties that were devalued losers become steady sources of government payments. Probably after most of them are bought up by the people who pay for the change in the law.

Welcome to the new Cabrini Green.

42 entire blocks in NYC is getting rezoned residential.

New York Plans to Convert Parts of Midtown Manhattan to Housing

Mayor Eric Adams announced plans to rezone manufacturing areas south of Times Square and allow more office buildings to be converted to housing.

www.nytimes.com

Loveland City Council to consider changes to building codes at special meeting

Loveland City Council will discuss building code updates, rezoning and a potential incentive agreement for Bass Pro Shop at its Tuesday special meeting.

www.reporterherald.com

 

[Leadeye]

42 entire blocks in NYC is getting rezoned residential.

New York Plans to Convert Parts of Midtown Manhattan to Housing

Mayor Eric Adams announced plans to rezone manufacturing areas south of Times Square and allow more office buildings to be converted to housing.

www.nytimes.com

Loveland City Council to consider changes to building codes at special meeting

Loveland City Council will discuss building code updates, rezoning and a potential incentive agreement for Bass Pro Shop at its Tuesday special meeting.

www.reporterherald.com

Migrants can be a gold mine for some, and we wonder why nothing is done about the border.

 

[KLB]

Why wouldn't you rezone those areas? Commercial space is not going to be as in demand as it once was. Not to mention, Manhatten has always had a huge lack of housing. Let them convert unused commercial space into residential.

 

[Leadeye]

It's a sanctuary city, changing the codes to house the migrants and get them off the street makes more sense than billeting them on the populace. With Tammany involved though, it's hard to say how it will shake out, hence my reference to old housing projects.

 

[Ingomike]

I recently read the the US has brought in 60 million people in the last twenty years or so. The housing “experts” say we have a 5 million home shortage in the country. Think this has bearing on housing prices? I do…

 

[Leadeye]

I recently read the the US has brought in 60 million people in the last twenty years or so. The housing “experts” say we have a 5 million home shortage in the country. Think this has bearing on housing prices? I do…

A lot of those folks come from warm places. I wonder how they will do with the cold weather.

 

[manifest destiny]

I recently read the the US has brought in 60 million people in the last twenty years or so. The housing “experts” say we have a 5 million home shortage in the country. Think this has bearing on housing prices? I do…

That's the equivalent of almost 9 Indianas added to the union. That's a crazy number, and it's probably low. America is blessed with space. But we can't house the entire world. Putting it in scale of 9 states being added makes it sound scary. One could also frame it as adding 1MM+ to every state in the union. Yeah, it still sound crazy.

 

[smokingman]

Banks' Usage Of The Fed's Emergency Facility Hits New Record High As Money-Market Fund Inflows Resume | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

• Discount window usage up $700MM to $2.9BN(daily overnight loans to banks)
• BTFP up $150MM to $107.5BN, new record high(25 billion program was advertised to be what was needed just 4 months ago. I said it then no way 25 billion would save the banks and they would do much more.)
• Other credit extensions (FDIC loans) down $2.8BN to $134.4BN
• Usage of The Fed's emergency funding facility for banks reached a new record high of $108BN (longer term than over night loans issued in the discount window)

The inflation problem in a nutshell is our banking system,and is going to get much worse.

 

[smokingman]

Banks' Usage Of Fed's Emergency Funds Jumps To New Record High, Money-Market Inflows Soar | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

The emergency FED loan program is set to end in 6 months. Does anyone believe the 25 billion(initial size) that has ballooned to over 108 billion will ever end?

Did the fed REPO window opened during 2008 end? Oh, it has a balance of 1.8 TRILLION per day in over night lending to banks(Face it they would have been insolvent more than a decade ago without this though). Take away the discount window and maybe 3 or 4 of the largest 20 or so banks would even exist.

How about the 138 billion in Fed lending to ??(who knows does not say...and well they do not have to legally).

But I am sure this new 25 billion dollar bank bailout program now over 108 billion will end in 6th months.

 

[smokingman]

Kyle Bass Sees Banks Losing Quarter Trillion Dollars In Coming Office Market Collapse; Morgan Stanley Sees 40% Wipeout | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

Speaking to Bloomberg TV, Kyle Bass said the US banking industry will lose hundreds of billions of dollars from exposure to the office market amid shifting workplace trends and elevated interest rates.

“Banks in the US will lose $200, $250 billion in office over time here,” Bass, founder of Hayman Capital Management best known for correctly predicting and profiting from the bursting of the subprime housing bubble, said on Monday. “And there’s about $2 trillion of equity in the banks so it’s like a 10% hit to US banking equity.”

While some may call Bass's view alarmist, there are even more draconian takes: in a report from the Morgan Stanley team published recently, the bank said that it expect CRE prices to be down - 27.4% from peak to trough in 18-24 months this cycle, not that far off from the -34.9% drop during the GFC in 34 months, which will range from -15% for apartments to a stunning -40% for office.

A 10% loss of banking equity is about a -3% GDP hit. Not to mention the FDIC has no chance in hell of being funded enough to cover depositors.

 

[223 Gunner]

A lot of those folks come from warm places. I wonder how they will do with the cold weather.

Maybe they will leave?? I doubt it, and yes I know that sounds mean.

 

[smokingman]

In the next phase(current). Banks can not meet capitol requirements,so they are making up new rules to free banks from much of the legally required reserves. Not that Frank Dodd has not already been weakened. It is supposed to be legally 10% in reserves(10% of what they issue loans for out of nothing),that is currently and has been the law. In reality the fed can change it without changing the law,like they are trying to do yet again.

Analysis-Fed shines light on path to US bank capital relief trades By Reuters

Analysis-Fed shines light on path to US bank capital relief trades

www.investing.com

Effective Date: FRB- Reserve Requirements of Depository Institutions | Compliance Alliance

AGENCY: Board of Governors of the Federal Reserve System. ACTION: Final rule. SUMMARY: The Board is amending Regulation D, Reserve Requirements of

compliancealliance.com

This is going to blow up spectacularly, and it will be depositor funds BY LAW this time when the banks need bailed out.

 

[smokingman]

Peter Schiff: Banks Have A Bigger Real Estate Problem Today Than They Did in 2007 | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

So, what’s the problem?

As Peter Schiff explained in a recent podcast, the problem this time is the mortgages themselves.

The banks are in worse shape and more vulnerable to the housing market now than they were in 2007 when everything collapsed and we had the financial crisis.”

The problem in 2007 and 2008 was defaults. As interest rates rose, people couldn’t afford to pay their mortgages. That forced banks to foreclose. With the real estate bubble deflating, banks couldn’t recoup their loans by selling the houses.

The problem was the banks had loaned out a lot of money with zero down or negative AM, and then housing prices went down, and then people started defaulting. Because of the defaults, the banks lost money. But the vast majority of mortgages didn’t default. It was just a large enough percentage that it caused insolvency at these banks.”

Because we have a fractional reserve system, banks don’t have nearly enough reserves to cover even a small number of their loans.

Today we have a much different scenario. Peter says it’s worse.

It’s not about default now. In fact, defaults would actually help. The banks would actually be better off if people defaulted on the mortgages. The problem is the mortgage itself. The banks are losing money on the mortgage.”

Banks wrote these mortgages when interest rates were extremely low. A 3% mortgage wasn’t uncommon a few years ago. Now mortgage rates are above 7%.

The banks are losing money on every mortgage that’s outstanding. So, even though people are still paying their mortgages, the bank is still losing.”

In 2009, the Fed slashed interest rates. That meant all the mortgages the banks owned that didn’t default went up in value. Those mortgages appreciated because the Fed slashed interest rates.

So, even though some mortgages that went bad, the mortgages that didn’t go bad, which were the vast majority, appreciated in value. Even with that, we still had the financial crisis.”

Today, there aren’t a lot of defaults. People aren’t struggling to pay a 3% mortgage. And while home prices have declined, most homeowners aren’t currently underwater. Even if they are, people aren’t selling. They don’t want to give up a 3% mortgage for a 7%-plus mortgage. That’s why inventory remains tight and that is holding prices up.


So, this is a very different crisis. But it’s worse because they’re losing money on every single mortgage they have whether or not they go into default. … So, this is bigger. It is a bigger problem for the banks. They’re losing more money, and they will lose more money now than they did in 2008. That means we’ll need an even bigger bailout. All these ‘too big to fail’ banks have an even bigger problem now than they did then, and it’s going to take an even bigger round of QE to bail them out. The problem is how’s the Fed going to do that when inflation is as high as it is and going higher?”

Also have the commercial side.

Blackstone's Massive CRE REIT Records Eleven Months Of Outflows | ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

 

[Creedmoor]

I recently read the the US has brought in 60 million people in the last twenty years or so. The housing “experts” say we have a 5 million home shortage in the country. Think this has bearing on housing prices? I do…

And before that we had 25 to 40 million illegals in the Country.

 

[Ingomike]

And before that we had 25 to 40 million illegals in the Country.

Right, illegals are now a third of our population…

 

[Ingomike]

Major Banks Close Over 3,000 Branches Nationwide, With Recent 50+ Closures from Bank of America In Just One Week | The Gateway Pundit | by Jim Hᴏft

Major financial institutions seem to be accelerating a trend that many conservatives find alarming: the closure of physical bank branches.

www.thegatewaypundit.com

 

[Chalky]

Major Banks Close Over 3,000 Branches Nationwide, With Recent 50+ Closures from Bank of America In Just One Week | The Gateway Pundit | by Jim Hᴏft

Major financial institutions seem to be accelerating a trend that many conservatives find alarming: the closure of physical bank branches.

www.thegatewaypundit.com

FYI... I received a malware/trojan horse alert and attempt after clicking this link. Maybe I inadvertently clicked something else on the site. Just wanted to pass it along...

 

[jamil]

FYI... I received a malware/trojan horse alert and attempt after clicking this link. Maybe I inadvertently clicked something else on the site. Just wanted to pass it along...

I mean. C’mon. It’s the gateway pundit.

 

[KLB]

If people went to the branches they wouldn't be closing.

 

[ditcherman]

Major Banks Close Over 3,000 Branches Nationwide, With Recent 50+ Closures from Bank of America In Just One Week | The Gateway Pundit | by Jim Hᴏft

Major financial institutions seem to be accelerating a trend that many conservatives find alarming: the closure of physical bank branches.

www.thegatewaypundit.com

So as someone who frequently drives through a few quickly developing areas and grinds his teeth because he sees new banks popping up like Dollar Generals, is this because the sky is actually falling this time or because we don't need brick and mortar?
(Also, this is coming from a guy who still writes maybe 1000 checks a year and uses brick and mortar)