Monday, April 20, 2009

Banking System is in complete and total collapse

This link and article were posted by Wayne under the Comments of my previous post from Sunday. It is important enough by and through its implications to give it additional exposure advancing it to my front page.


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The Turner Radio Network has obtained "stress test" results for the top 19 Banks in the USA.

The stress tests were conducted to determine how well, if at all, the top 19 banks in the USA could withstand further or future economic hardship.

When the tests were completed, regulators within the Treasury and inside the Federal Reserve began bickering with each other as to whether or not the test results should be made public. That bickering continues to this very day as evidenced by this "main stream media" report.

The Turner Radio Network has obtained the stress test results. They are very bad. The most salient points from the stress tests appear below.

1) Of the top nineteen (19) banks in the nation, sixteen (16) are already technically insolvent.

2) Of the 16 banks that are already technically insolvent, not even one can withstand any disruption of cash flow at all or any further deterioration in non-paying loans.

3) If any two of the 16 insolvent banks go under, they will totally wipe out all remaining FDIC insurance funding.

4) Of the top 19 banks in the nation, the top five (5) largest banks are under capitalized so dangerously, there is serious doubt about their ability to continue as ongoing businesses.

5) Five large U.S. banks have credit exposure related to their derivatives trading that exceeds their capital, with four in particular - JPMorgan Chase, Goldman Sachs, HSBC Bank America and Citibank - taking especially large risks.

6) Bank of America`s total credit exposure to derivatives was 179 percent of its risk-based capital; Citibank`s was 278 percent; JPMorgan Chase`s, 382 percent; and HSBC America`s, 550 percent. It gets even worse: Goldman Sachs began reporting as a commercial bank, revealing an alarming total credit exposure of 1,056 percent, or more than ten times its capital!

7) Not only are there serious questions about whether or not JPMorgan Chase, Goldman Sachs,Citibank, Wells Fargo, Sun Trust Bank, HSBC Bank USA, can continue in business, more than 1,800 regional and smaller institutions are at risk of failure despite government bailouts!

The debt crisis is much greater than the government has reported. The FDIC`s "Problem List" of troubled banks includes 252 institutions with assets of $159 billion. 1,816 banks and thrifts are at risk of failure, with total assets of $4.67 trillion, compared to 1,568 institutions, with $2.32 trillion in total assets in prior quarter.

Put bluntly, the entire US Banking System is in complete and total collapse.

10 comments:

Anonymous said...

I'm short banks so I ain't complaining, but the source is completely unreliable.

Allan said...

The source is out there, way out there. But I spot checked a number of their previous blogs and although a bit over sensationalized, I don't see anything that is a total fabrication. Based on the past two years of media coverage, I'm not sure there are any outlets that can be believed.

Anonymous said...

After checking this guy's blog I think I would reconsider posting his info on your blog, unless you want to be associated with this kind of thinking, which seems to be a theme...

http://turnerradionetwork.blogspot.com/2008/12/analyst-usa-to-suffer-civil-war-break.html

On the other hand, if the stress test info is true, then it's true and it should not matter where it comes from. I have no doubt we're going to get lied to about it so the report is not unbelievable.

David said...

Here's some official word on the issue. Not that what he's saying won't turn out to be true but for now it appears to be a false alarm.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aZCb6UIETseA&refer=home

Dave said...

My two sides (not 2 cents):
If it turns out to be a total fabrication on Turner's part, his blogging days may be over...not sure if a First Amendment plea would work in this environment.
Even if the results were that bad, I'm not convinced we would ever see the sanitized version.
Dave

Wayne said...

Yeah sorry for posting this crap, I got lazy and didn't do any fact-checking myself, and got more info later today ( see below ). Like the rest of you tho, I won't be surprised if the meat of this turns out to be true.

"Just as a note - the source of this is not exactly the world's most credible. Hal Turner is a notorious white supremacist talk show host based out of New Jersey. I'd take the info with a grain of salt. Also, he may have lifted a fair amount of it from a press release from an author promoting his book.

More info on the whole debacle - http://www.publicradio.org/columns/marketplace/scratchpad/2009/04/it_just_gets_weirder_and_weird.html"

Anonymous said...

i can't believe that you posted
the comments of the virulent antisemitic site.

PENN STATE Eric said...

Wow, I just went to the Turner website link provided and it's horrible. It's disturbing to know there people who are that animate about being a specific race or creed still. Aren't we past that yet? Some of the root arguments are good but the racial multiplier seems to be the driving force and some of the comments posted are just mind blowing or all the wrong reasons. Damn shame people still think that way. We're all here to make the planet a better place in general but some people wanna use others as the scapegoat or stepping stone and that's just sad.

Enlightning to be exposed to that. To each his/her own but damn, they're a sad bunch.

Allan said...

Eric, Again, I ask, what is the US Treasury doing responding and drawing attention to this guy? Something is rotten in Denmark, or worse, somewhere closer to home.

PENN STATE Eric said...

Interesting Maybe the idea of drawing attention is to soften the impact of the actual release of results of the stress tests for Friday (tomorrow). The market responded Monday whether this leaked report was true or not, and it responded negatively, which would be expected given hose claims. If those numbers were to stick, I'd gather the initial drop Monday maybe was to spread the loss of wealth over a few days of trading as opposed to a single day super crash - which will still happen tomorrow if these results are the same. some of Turners claims are so horribly crazy that the real impact here could be catastrophic. I mean, talk about contraction of consumer confidence. Everyones' wallet will be sewn closed and people will go back to stuffing money under their mattresses with the loss of trust.

Everything is an experiment for the Gov't right now, trial by fire, we've never been here with the banks in this kind of shape globally. We need to learn from every action taken and observe the results for future reference. We're in the information age so all this data can be stored and interpreted for years to come.

If the stress test results were to be favorable, we would already know because Bernake and Geitner would be telling us all the time and we would be inundated with "spend spend spend, everything's alright again" type messages.

I am fortunate enough to be a young man who has much time to recover from this downhill slide, so I am using this as one heck of a learning experience (or nasty knowledge bump) but I feel bad for those who are now-to-5 years out from retirement who have lost most of their wealth even though they were in conservative investment vehicles. Tomorrow may not be a kind day, less you have some puts in line.