Bank Failures Are Coming (Do This ASAP)
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- Опубліковано 8 чер 2024
- Let's discuss the Federal Reserve comments on the 2024 Banking Crisis - Thanks for watching! Click the link below to get DELTA Pro Ultra and related bundles. Now enjoy 6 months of interest-free payments & 5-year installment plan offer. The Smart Home Panel 2 Installation Consulting Service ensures a hassle-free setup by tracking orders, managing fittings, and answering technical queries for TX/CA homeowners. EcoFlow Website: bit.ly/3HREAAB
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THE 2024 BANKING CRISIS:
Commercial Real Estate values are plummeting, with Morgan Stanley estimating that the “entire market could decline 40% - which is the same magnitude that we saw throughout the 2008 Financial Crisis."
As CNN explains, “US banks hold about $2.7 TRILLION dollars in Commercial Real Estate Loans…and about 80% of that is held by smaller, regional banks…the ones that the US government hasn’t classified as “too big to fail.” On top of that, "More than $2.2 Trillion will come due between now and the end of 2027, so regional banks could have problems collecting on those loans.”
All of this was driven by New York Community Bancorp which "reported a surprise loan loss of $552 million dollars, driven partly by expected losses on commercial real estate loans.” In this case, “the bank identified a pair of loans in particular - one related to an office complex and another for a co-op residential building - that were responsible for as much as $185 million in losses.”
Germany’s biggest lender, Deutsche Bank, also said that it allocated $133 million during “the last quarter to absorb potential defaults on its US commercial real estate loans. That’s more than quadruple the amount it set aside during the same three-month period in 2022.”
In response to this, Jerome Powell said that “There’s some smaller regional banks that have concentrated exposures in these areas that are challenged and we’re working with them. It feels like a problem we’ll be working on for years. It’s a sizable problem.”
According to the National Bureau of Economic Research, about 14% of “all commercial real estate loans and 44% of loans on office buildings appear to be in a negative equity position, meaning the debt is greater than the property value.” As they say, “That increases the risk that borrowers won’t repay and will default on their loans” - which eventually falls back on banks that may or may not have the ability to survive the loss.
Thankfully - Jerome Powell said that “there will be losses for the owners and for the lenders, but it should be manageable."
He also went on to say "The economy's strong. The labor market's strong. Inflation's coming down. We don't have a perfect crystal ball about the future, and things could happen. But I do think the economy is in a good place, and there's every reason to think it can get better."
In terms of New York Community bank, “analysts at Bank of America cited “feedback from management” that New York Community Bancorp was not experiencing any unusual deposit activity.” However, their share price has continued declining - so, investors aren’t exactly optimistic about the short-term future, despite what analysts say.
Of course, full disclosure: anything can happen, I have no idea what I’m talking about, don’t listen to a random guy on UA-cam, always consult a professional for your own specific situation, and all of this is purely my opinion.
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-Jerome Powell: “Smaller banks will ‘have to be closed’ or merged ‘out of existence’ because of falling property values."
-Here is a link containing the source material for each piece of research cited. I do my best to make my videos as accurate as I can, and the additional resources should help anyone who wants to look into them further - enjoy! docs.google.com/spreadsheets/d/1T9raejfmvVQNdqCFYBbuI3xE8KuXsnLPfqJr5T261O0/edit?usp=sharing
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This is intentional.
I've been looking at the commercial real estate crisis slowly unfolding since people didn't go back to the office after covid. One of my friends works the debt collection part of banking and has been largely concerned about this issue lately. It was only a matter of time.
The fractional reserve requirement is actually Zero. Has been since 2020. Banks don't have to hold a penny.
It's quite simple why rates are climbing with rising imports and falling exports, the FED is obviously to be blamed for banking crisis. Something will eventually break if they keep the quantitative tightening and higher interest rates. Is this really a good time to have some savings in stocks?
first austerity, then brexit, now widespread bank failures. .always do your own research & speak to a license advisor before thinking about putting your money into these crazy markets
Exactly, I used to doubt the value of a financial advisor until my wife's company assigned her an investment adviser in 2020. Honestly, it’s been the best financial decision I’ve made. It helped tremendously; I went from barely making any profit to having a well-diversified portfolio that has grown significantly, with gains exceeding $850k.
I’ve been worried sick about the current state of my portfolio, who is your advisor?
Sonya lee Mitchell is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
I searched her up, and I have sent her an email. I hope she gets back to me soon. Thank you
Damn these Bots are pushing these fake coins like crazy
Yes protect ur investments that’s what’s important now, keeping money the govt keeps printing
Banking cabal that controls governments does the printing.
Let me guess, this comment is botted an will have fake replies
When the government tells you to stay calm, it's time to run!
😂😂😂😂😂
Well as they say.”You will own nothing and you will be happy” …
Speak for yourself 🤓 🖕
Jokes on them! I have no money in my bank account! 😎
Touché
Bidenomics?
😂😂
made my day with that one😂
There is a such thing as a safe place to keep your money and it’s not the banks AB’s it’s not under your bed
I don't understand how the C.E.O.s and other banking big wheels always manage to get their millions or billions. Businesses used to pay their expenses, then distribute the profits to themselves. Now, they seem to take their desired (greedy) salaries and try to pay expenses with whatever is left, which doesn't always work out.
there are people that are salary, and then there are those that are paid almost entirely in bonuses. Almost two different worlds of pay.
Yes it is the bonuses that they have been abusing these past couple of decades and now it's catching up with them.
Bonuses are in large part in stock options and the like, though. It’s not really like they could pay their expenses with stocks.
they sell the stocks for MONEY. artificially inflating their stock value at the expense of the long term health of the company so they can cash out. what a broken system.@@matthewtanous7905
Graham, been watching you for years, and somehow you take a firehose of information, analyze it, condense it, and give it to us straight with facts in few minutes. Thanks for all of your hard work and support to back your arguments!
falling property values, yet the county tax accessor keeps raising my taxes cause they claim prices are climbing, plus a 5% kicker for inflation
Banks are stealing money from customers' accounts and not giving it back regardless of how much money you have in the bank.
Title says: "Do This ASAP". However, it's not clear to me what the word "this" is referring to. Is something you said in this video? Could you clarify?
Been watching you for years Graham and I have learned a lot from you. Your videos are helping me become financially stable and independent. You are always funny, informative, and unbiased. Hard to find all of that. Keep up the great work.
Thanks for the kind words!
The only exception is when you did that crap with FTX
This FTX era was bad bad when we found beloved graham in the mix😅 @@mattcrim7714
Appreciate you, Graham.
Thanks for watching!
i just wish people cared more about fixing the system instead of what they can do to get ahead.
This time, the federal reserve cannot save them. Least they better not... shouldn't have in the first place.
Absolutely. The FDIC said they were insolvent. That means no backstop for bank deposits- tthhey just don't have the cash to cover the spread brace for end of Fiat system.
Spoiler alert. They will. 🎉
What are we supposed to do before this happens!?
He never said?
The fractional reserve banking system sounds very similar to a Ponzi Scheme 😁
:o
Not when it's fdic insured
@@raiden031 Lol the FDIC is only capable of coverig so much, and just like the fractional reserve banks with their deposits, it's a lot less than the number they say they can cover
Anytime you see the words FDIC, State or Government replace it in your head with the word Taxpayer. Makes it easier to realise you're getting hosed lol
@@Greebodeux so my premiums on medical, car, and home insurance are not hosing me?
This is why we are seeing layoffs across the big banks. Because they are trying to save and conserve as much money as they can from losses in commercial real estate.
The banking crisis had never stopped in the first place, it just reentered the news cycle. Watching NY Community Bancorp drop 45% instantly was interesting though.
The free stock I got was 500 shares of Enron stock. Oh, and 1,000 shares of stock in a company that defrauded all of its customers and investors. Thanks Graham!
“Paper money eventually returns to its intrinsic value -- zero.”
~ Voltaire
"Gold is Money everything else is Credit"
JP Morgan
from its a wonderful life "you act like the moneys in a safe somewhere"
Exactly!
@@GrahamStephan I learned everything I needed to know about finances from that movie. (I'm a real estate agent, they did a good flip! lol)
Thanks for the info Graham!
Thank you for this discussion, I love your videos.
AMS48K seems like a solid play too, low to medium risk
Scammer be gone
Low to medium risk. Like your mom.
Graham you are the man. Enjoy all your videos
His hands. They don’t stop moving
This is a super insightful! Thank you Graham!
Love the AMS48K content. I think this project is just as essential as HBAR and they both will be great movers
Went right out of my way and hit the like button. You deserve it Graham.
Yeah your bank Yotta! We can’t get our money out! I used to look up to you Graham. Integrity is priceless! But I guess you’ll be “laughing all the way to the bank” tho Coffezilla is a TRUE role model
Eco-Flow!
Great sponsorship!
I've had interest in a battery as home power back up since last year.
Love how you explain the complexity of the concept in an easy to understand way!! That’s a true gift and talent !!
Love how you explain the complexity of the concept in an easy to understand way!! That’s a true gift and talent !! ❤🙌🏼🙌🏼🙌🏼
Thanks Graham!
Love the summary in video description
You're awesome Graham!
Ah thanks for watching!
Content has gotten more substantive again, good job!
10:00 to skip the ad
Yes, and the FDIC made SVB customers whole and then some. I do not understand how the FDIC was on the hook for people that kept more than the FDIC insured 250k in an account. I am sure it was political.
Partly to restore faith in the banking system
@@raiden031Yes most likely. Having big bank runs would be a nightmare for everyone.
started my channel watching your videos 🙏🏻🙏🏻🙏🏻 love your content graham ❤️
Oh lord reading these comments is like reading a yahoo finance chat pump and dump 😂.
hahaha
Thanks for your video
Great video
your bank failed and took all my money
Hey graham appreciate your videos watching from ohio
Thanks for watching!
Definitely getting that external battery! Thanks G man
Thanks G!!
There is one clear opportunity. If office space is in excess then buy cheap and convert to other uses.
I read recently, in most of the cases it's very difficult (in another words; too expensive) to convert office spaces into living areas.
I always wondered why my father banked at four different banks, for the businesses that we owned it was because he would never put more than the FIC insurance would cover
FDIC
So, can I buy an office space and live in it since housing is unaffordable?
And your own bank failed :-(
Gram it looks like your hands are floating with that background and sweater combo. Thx for the vid
So if commercial is lowering value and many loans are coming due with the exception of office, space, is it recommended to look for opportunities to purchase obviously at a reasonable low price?
love the patek philippe
Good info!
❤ty for the vids
It's interesting that the fed will allow the small banks to go under leaving just the large banks. The banks likely did nothing wrong when they made those loans. They'll get squeezed on trades and it will create opportunities for those that get to take them over. Seems too bad.
It's always on purpose.
He's so happy about the Recession coming in, like he's super excited to be witnessing it.
Because an entrepreneur knows there’s mega business opportunities that come out of recessions.
Me too. Let's correct teh commerical real estate market and make it affordable for small business to start up with reasonable rent.
i want to buy a home for 25k ;D
Too late for most
Well I hope you get some R&R. I hear ya. The training for that competition in April for the military is killing me lol.
How often are you training? I've been finally getting back into the gym 5-6x per week!
I did not expect a generator ad in a graham video 😂
Cool fish tank Graham 😎
Thank you!!
Excellent, Graham.
It was always going to be office space and future retail space will become an issue as more and more people continue to use Amazon, etc.
Great video. Im a huge AMS48K fan and love your videos on it.
Scammer be gone
Scammer be gone
I bought some and it turned me gay
@@MiggerPleasehilarious
@@bsqkrktn I really don't like it so far
Hey Graham, if a financial institution like a bank or credit union closes, what happens to the member accounts that resided in the institution?
Incorrect, new laws say no reserves in banks are no longer required
Still liking. Hope you been well man!
Thank you so much, you too! Everything been decent on my end - trying to find some time to take a few days off, hopefully will happen end of the month!
Have not heard you in a while, but your presentation is still spot on! From a twice retired professional, Ivy leaguer and owner of his own company, Thanks!
How is this not considered a Ponzi scheme? this is the definition of a Ponzi
*This explains why my realty income shares are tanking* 😂
:O
Time to buy more. Discount program
Seems like the problem with commercial real estate has been there for years and miraculously it never harms the banks. Someone is propping up the system.
just used most of my excess money to pay off my house, and i sleep sooo much easier at night now
Congratulations!!
Hey graham! really looking forward to your feedback when you get a chance on the message and the site - thanks bro!
Will do!
“….there’s every reason to think it can get better.”
Iiiiiigh think I’m gonna go out and buy a little toilet tissue and some canned goods. I remember as a kid listening to commercials bragging about the fact that more people in the u.s. now work in the office than actually produce. I never understood how that was possible or even good.
I can't wait!!!
With the Karate club I teach, I'm pretty much training 6-7 days a week. That's great that you started back. I may take a break for Mardi Gras though.
Nice!! Keep it up!
Office space has been tough due to people working at home too... Many of those buildings are turning into apartment buildings...
Interesting fact i learned a few months ago. Here in the UK, banks have 0 reserve requirement! Of course they probably don't actually go that low, but it's scary to think it's allowed.
@1:22 WRONG!. Since March 2020, banks are not required to keep 10% of deposits. The current requirement is 0 (ZERO) percent.
@grahamstephan banks haven't had a reserve limit for years now. Most have closer to 0% reserve than 10%.
lol is that a car inside your house? okay.....
As a lower GS grade, traditional all day. I'm able to put more money in. More money in the TSP means more shares that I can buy and flip.
Commercial property owners and managers have increased the cost to lease and rent commercial spaces insanely high. Its not a crash they just need to be more resonable in their prices. Just like the housing market its just over valued.
You will own nothing and it will feel crappy.
Lol
Thank you, financial MatPat.
:)
Bruh😂
Well this is interesting
Agreed!
I didn´t understand how you calculated the value of commercial building based on interest rates.
Graham advertising backup power supplies is scary for the economy
The banks are not required to deposit any of your money for fractional banking now days 🤔
Are there any Full Reserve banks?
You mean where they hold 1:1? Not that I'm aware, otherwise it would be impossible for them to ever turn a profit or stay in business
I have money in flagstar bank which is owned by NYCB should I pull out?
A friend works at a credit union. They hold many second mortgages and credit lines. The rate fluctuates. She said people come in everyday crying they can’t afford loan payment. Plus they have car loans. Can you do a story on this.
perspective....If you worked at a homeless shelter all you'd see are homeless people.
@@pilot88proexactly. People pay their loans online or auto pay daily ... The ones that can't pay bc of a financial situation will be needing to come in person to discuss their options with a loan officer for a modification.
That’s nothing special that people are broke
That's not how banking works. They make a deposit at the Federal Reserve and leverage it up for loans.
Whenever there's something stupid to be done, DB is the first in line.
Would you rent a townhouse or buy a home as a single man with no kids?
What is your time frame for this ??
With the case of nycb there was a number of construction loans given to rent regulated apartments in new york. Only concern is what does this mean for the value of the real estate in a significant market in the country.
Where is flat chested wide 😮😮
This is gonna be fun.