If 24 goes bad you'll see it.
First Republic Bank down 44%
- Thread starter xsn10s
- Start date
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L2land
Well-Known Member
Tell me if I'm wrong but doesn't fractional reserve banking almost guarantee that the banks won't be able to afford to pay you the interest you should get vs the established rate unless they borrow capital that they can't afford because the rates are too high?
birddog 68
Well-Known Member
I'm pretty sure this is already happening.
xsn10s
Well-Known Member
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- Mar 7, 2016
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That is a distinct possibility.
Hugnot
Well-Known Member
Groping inside my head for a reason - like the Fed has boosted interest rates from near zippo & new bonds pay more making older issues less valuable & banks have much $ tied up in older bonds that pay interest but have less value. The banks planned to periodically sell off these bonds havng lower yields at a measured pace but now these bonds have less value due to rapidly increasing interest rates. If interest rates decreased the older bonds would be worth more but lowering interest rates below zippo is unlikely.
Interest rate increases make borrowing more expensive. Inflation increases operating costs.
The liberals blame the Fed for raising interest rates vs big government spending causing inflation. Depositors & investors sense doom & bail out.
2007-2009 upset was mostly caused by junk mortgages & defaults. Now we have rob the rich (like Robin Hood) to have good credit borrowers subsidize poor credit borrowers for mortgages. Should legions of these poor credit borrower default on mortgages we could have another 2007-2009. Imagine some bank holding 100 mortgages at $450K each & some 25 mortgages default causing a loss of $11.25M.
The Federal Reserve never returns my phone calls - like they are autonomous & never answer to anybody. Allen Greenspan ran things good for many years.
Some movie might be made like in Trading Places with the orange juice futures but instead wildly fluctuating bond yeilds & values. I sold my bonds when Joe was chosen.
Interest rate increases make borrowing more expensive. Inflation increases operating costs.
The liberals blame the Fed for raising interest rates vs big government spending causing inflation. Depositors & investors sense doom & bail out.
2007-2009 upset was mostly caused by junk mortgages & defaults. Now we have rob the rich (like Robin Hood) to have good credit borrowers subsidize poor credit borrowers for mortgages. Should legions of these poor credit borrower default on mortgages we could have another 2007-2009. Imagine some bank holding 100 mortgages at $450K each & some 25 mortgages default causing a loss of $11.25M.
The Federal Reserve never returns my phone calls - like they are autonomous & never answer to anybody. Allen Greenspan ran things good for many years.
Some movie might be made like in Trading Places with the orange juice futures but instead wildly fluctuating bond yeilds & values. I sold my bonds when Joe was chosen.
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Good news is we have more fixed rate mortgages today than variable like in 08. Bad news is fed printed more money in last couple years than all previous years combine. Tie that to "dollar" not being back by anything but "confidence" it will be going away. BRICS is on a mission to ensure that. I don't have answers but I think the writing is on the wall.
birddog 68
Well-Known Member
Stupid question, what is this?
Things are getting a little scary!
The wife and I are older but I worry for my grown kids and grandkids.
What will they have in 20 years?
The wife and I are older but I worry for my grown kids and grandkids.
What will they have in 20 years?
I been hearing that for years. Truth is the dollars not going anywhere. We have the largest economy and the largest military. Whats going to replace it? Or you can be like Sadam and find out what happens.
