[Home]  [Headlines]  [Latest Articles]  [Latest Comments]  [Post]  [Mail]  [Sign-in]  [Setup]  [Help]  [Register] 

AI is exhausting the power grid. Tech firms are seeking a miracle solution.

Rare Van Halen Leicestershire, Donnington Park August 18, 1984 Valerie Bertinelli Cameo

If you need a Good Opening for black, use this.

"Arrogant Hunter Biden has never been held accountable — until now"

How Republicans in Key Senate Races Are Flip-Flopping on Abortion

Idaho bar sparks fury for declaring June 'Heterosexual Awesomeness Month' and giving free beers and 15% discounts to straight men

Son of Buc-ee’s co-owner indicted for filming guests in the shower and having sex. He says the law makes it OK.

South Africa warns US could be liable for ICC prosecution for supporting Israel

Today I turned 50!

San Diego Police officer resigns after getting locked in the backseat with female detainee

Gazan Refugee Warns the World about Hamas

Iranian stabbed for sharing his faith, miraculously made it across the border without a passport!

Protest and Clashes outside Trump's Bronx Rally in Crotona Park

Netanyahu Issues Warning To US Leaders Over ICC Arrest Warrants: 'You're Next'

Will it ever end?

Did Pope Francis Just Call Jesus a Liar?

Climate: The Movie (The Cold Truth) Updated 4K version

There can never be peace on Earth for as long as Islamic Sharia exists

The Victims of Benny Hinn: 30 Years of Spiritual Deception.

Trump Is Planning to Send Kill Teams to Mexico to Take Out Cartel Leaders

The Great Falling Away in the Church is Here | Tim Dilena

How Ridiculous? Blade-Less Swiss Army Knife Debuts As Weapon Laws Tighten

Jewish students beaten with sticks at University of Amsterdam

Terrorists shut down Park Avenue.

Police begin arresting democrats outside Met Gala.

The minute the total solar eclipse appeared over US

Three Types Of People To Mark And Avoid In The Church Today

Are The 4 Horsemen Of The Apocalypse About To Appear?

France sends combat troops to Ukraine battlefront

Facts you may not have heard about Muslims in England.

George Washington University raises the Hamas flag. American Flag has been removed.

Alabama students chant Take A Shower to the Hamas terrorists on campus.

In Day of the Lord, 24 Church Elders with Crowns Join Jesus in His Throne

In Day of the Lord, 24 Church Elders with Crowns Join Jesus in His Throne

Deadly Saltwater and Deadly Fresh Water to Increase

Deadly Cancers to soon Become Thing of the Past?

Plague of deadly New Diseases Continues

[FULL VIDEO] Police release bodycam footage of Monroe County District Attorney Sandra Doorley traffi

Police clash with pro-Palestine protesters on Ohio State University campus

Joe Rogan Experience #2138 - Tucker Carlson

Police Dispersing Student Protesters at USC - Breaking News Coverage (College Protests)

What Passover Means For The New Testament Believer

Are We Closer Than Ever To The Next Pandemic?

War in Ukraine Turns on Russia

what happened during total solar eclipse

Israel Attacks Iran, Report Says - LIVE Breaking News Coverage

Earth is Scorched with Heat

Antiwar Activists Chant ‘Death to America’ at Event Featuring Chicago Alderman

Vibe Shift

A stream that makes the pleasant Rain sound.


Status: Not Logged In; Sign In

Economy
See other Economy Articles

Title: The US Has the World Setup for a Worse Financial Crisis Than in 2008
Source: LRC
URL Source: https://www.lewrockwell.com/2023/03 ... financial-crisis-than-in-2008/
Published: Mar 21, 2023
Author: Paul Craig Roberts
Post Date: 2023-03-21 19:03:06 by Charles_Byrd
Keywords: None
Views: 60

There are two main avenues to a potential US financial crisis. Such a crisis, because of US financial dominance and because of the interconnections of globalism, which was a huge mistake for humanity, would be international.

One avenue to crisis is the Federal Reserve’s current policy of raising interest rates. This policy follows many years of nearly zero interest rates in nominal terms, and negative interest rates in real terms. During these many years the financial assets banks accumulated on their balance sheets, such as bonds, pay a low rate of interest. When the central bank (Federal Reserve) raises interest rates, the values of the lower interest rate financial instruments fall, thus shrinking the asset side of banks’ balance sheets but not the liabilities side. Thus the central bank’s policy is pushing banks toward insolvency. When depositors realize that their deposits could be frozen for some time or lost if over $250,000 in size, as many corporation payrolls and some individual accounts are, they withdraw their deposits. The banks cannot meet the withdrawals because their assets have shrunk in value relative to deposits and because as they sell the depreciated assets to meet the withdrawals the prices of the troubled assets fall further. Silicon Valley Bank had assets heavily weighted with low interest rate US Treasury bonds, the value of which was driven down by the Federal Reserve raising interest rates. The other two banks were victims of crypto-currency which is too volatile for a bank’s balance sheet.

Click for Full Text!

Post Comment   Private Reply   Ignore Thread  


[Home]  [Headlines]  [Latest Articles]  [Latest Comments]  [Post]  [Mail]  [Sign-in]  [Setup]  [Help]  [Register] 

Please report web page problems, questions and comments to webmaster@libertysflame.com