{"id":1927284,"date":"2023-05-09T08:57:41","date_gmt":"2023-05-09T12:57:41","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/charles-gasparino-jerome-powells-sappy-talk-on-banks-is-weak-after-multiple-collapses\/"},"modified":"2023-05-09T09:05:34","modified_gmt":"2023-05-09T13:05:34","slug":"charles-gasparino-jerome-powells-sappy-talk-on-banks-is-weak-after-multiple-collapses","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/charles-gasparino-jerome-powells-sappy-talk-on-banks-is-weak-after-multiple-collapses\/","title":{"rendered":"Gasparino: Powell&#8217;s Weak Bank Talk After Multiple Collapses"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">16<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fcharles-gasparino-jerome-powells-sappy-talk-on-banks-is-weak-after-multiple-collapses%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1927284&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>The US Banking System: Sound and Resilient or on the Brink of Collapse?<\/h2>\n<p>\u201cThe US banking system is sound and resilient,\u201d Jerome Powell proudly stated, just days after the government took over First Republic Bank, marking the second<a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/regulators-announce-closure-of-nys-signature-bank-which-held-significant-crypto-stakes\/\" title=\"Regulators Announce Closure of NY\u2019s Signature Bank, Which Held Significant Crypto Stakes\">-largest bank failure<\/a> in US history. In our Fed chair\u2019s world, First Republic is just another one-off, like Signature and Silicon Valley banks before it.<\/p>\n<p>Sorry, one-offs (as Powell\u2019s trying to frame First Republic) rarely come in threes, or fours if you count the ill-fated Credit Suisse\u2019s forced merger with UBS by the Swiss.<\/p>\n<h3>The Latest Problem Child<\/h3>\n<p>Not long after Powell\u2019s assurances, regional-bank stocks began to crash. Fox Business\u2019s Eleanor Terrett and Charlie Brady reported that just in the past week, the sector is down 10%. For the year, regional-bank stocks are down 34.6% \u2014 compared to an 8.1% rise in the S&#038;P 500.<\/p>\n<p>The latest problem child appears to be LA-based PacWest Bancorp, with $40 billion in assets. It\u2019s smaller than the $200-plus-billion at First Republic, but not insignificant, and its stock collapsed not long after Powell\u2019s remarks. Shares recovered a bit Friday but not enough. They\u2019re still down 82% from their 52-week high and its management continues to seek a <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/sec-chairman-met-with-head-of-ftx-months-before-collapse\/\" title=\"SEC Chairman Met With Head of FTX Months Before Collapse\">white-knight savior<\/a>.<\/p>\n<h3>The Main Culprit<\/h3>\n<p>The main culprit is, of course, <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/janet-yellen-as-congress-for-billions-to-help-other-countries-debt-relief-climate-change-initiatives\/\" title=\"Janet Yellen As Congress For Billions To Help Other Countries\u2019 \u2018Debt Relief,\u2019 \u2018Climate Change\u2019 Initiatives\">higher interest rates<\/a>. Also a lack of leadership. The Fed is the nation\u2019s front-line bank regulator. But Wall Street appears to have less faith in Powell\u2019s ability to stem the latest systemic threat to the US economy \u2014 a smoldering crisis threatening scores of midsized banks \u2014 than it had in his ability to foresee \u201ctransitory\u201d \u00adinflation.<\/p>\n<p>Ditto for Treasury Secretary Janet Yellen, another player in the bank regulatory apparatus. For weeks now, she\u2019s also been telling the markets things are fine with our banks. Logic suggested quite the opposite, particularly at the regional-bank level where management collectively appears to have drunk from the same cup of Kool-Aid.<\/p>\n<h3>Banking is a Confidence Game<\/h3>\n<p>We can use a few George Baileys now. As word of risk-taking spreads, regional depositors are running for the exits. They\u2019re draining the banks of their capital and sending them into insolvency because they don\u2019t know what they\u2019re backing up, such as <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/charles-gasparino-jerome-powells-sappy-talk-on-banks-is-weak-after-multiple-collapses\/\" title=\"Gasparino: Powell's Weak Bank Talk After Multiple Collapses\">increasingly depressed commercial real estate<\/a>. Their execs hide behind a phalanx of Pollyannaish flacks who can\u2019t be trusted with the truth. First Republic dodged important questions during its last analysts call that guaranteed its demise.<\/p>\n<p>Powell and Yellen offer bromides, too, and a patchwork of short-term fixes. A shotgun marriage arranged by the Feds allowed JPMorgan to buy First Republic in receivership with oodles of government guarantees. It did nothing to stem worries about the system, as this past week\u2019s events demonstrated.<\/p>\n<h3>No Quick Fixes<\/h3>\n<p>Sorry, there are no quick fixes for the pickle we\u2019re in except possibly trying to avoid the sins of the past. We need Jerome Powell to turn into George Bailey and start telling the country some hard truths. The Fed printed money when it wasn\u2019t necessary. The hyperlow interest rates of the past three years lasted much longer than the existential threat of those COVID lockdowns to the economy. And now the bill is coming due.<\/p>\n<ul>\n<li>Clueless Yellen fails to stave off <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/regulators-shut-down-signature-bank-two-days-after-silicon-valley-bank-collapse\/\" title=\"Regulators shut down Signature Bank two days after Silicon Valley Bank collapse\">bank crisis<\/a> as First Republic sinks<\/li>\n<li>Bud Light sales decline proof brands need to know their audience before going woke<\/li>\n<li>Wall Street &#8216;egging&#8217; on freezing egg pregnancy delays<\/li>\n<li>Dylan Mulvaney controversy at Anheuser-Busch is giving the company a bitter sip of woke<\/li>\n<li>Trump is now Joe Biden&#8217;s favorite 2024 foe<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>More From: Charles Gasparino Clueless Yellen fails to stave off bank crisis as First Republic sinks Bud Light sales decline proof brands need to know their audience before going woke Wall Street &#8216;egging&#8217; on freezing egg pregnancy delays Dylan Mulvaney controversy at Anheuser-Busch is giving the company a bitter sip of woke Trump is now<\/p>\n","protected":false},"author":1,"featured_media":1927285,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[5373,3961,8118,4066,20702,5852,7723],"class_list":["post-1927284","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report","tag-bank","tag-collapses","tag-gasparino","tag-multiple","tag-powells","tag-talk","tag-weak"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1927284","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1927284"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1927284\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1927285"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1927284"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1927284"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1927284"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}