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20 banks that are sitting on huge potential securities losses—as was SVB

SVB Financial Group faced a perfect storm, but there are plenty of other banks that would face big losses if they were forced to dump securities to raise cash

Silicon Valley Bank has failed following a run on deposits, after its parent company’s share price crashed a record 60% on Thursday. Trading of SVB Financial Group’s SIVB, -60.41% stock was halted early Friday, after the shares plunged again in premarket trading. Treasury Secretary Janet Yellen said SVB was one of a few banks she was “monitoring very carefully.” Reaction poured in from several analysts who discussed the bank’s liquidity risk. California regulators closed Silicon Valley Bank and handed the wreckage over to the Federal Deposit Insurance Administration later on Friday. Below is a  list of 10 banks  that showed similar red flags to those shown by SVB Financial through the fourth quarter. This time, we will show how much they reported in unrealized losses on securities — an item that played an important role in SVB’s crisis. Below that is a screen of U.S. banks with at least $10 billion in total assets, showing those that appeared to have the greatest exposure to unrealized securities losses, as a percentage of total capital, as of Dec. 31. Some media reports have referred to SVB of Santa Clara, Calif., as a small bank, but it had $212 billion in total assets as of Dec. 31, making it the 17th largest bank in the Russell 3000 Index RUA, -1.70% as of Dec. 31. That makes it the largest U.S. bank failure since Washington Mutual in 2008. One unique aspect of SVB was its decades-long focus on the venture capital industry. The bank’s loan growth had been slowing as interest rates rose. Meanwhile, when announcing its $21 billion dollars in securities sales on Thursday, SVB said it had taken the action not only to lower its interest-rate risk, but because “client cash burn has remained elevated and increased further in February, resulting in lower deposits than forecasted.” SVB estimated it would book a $1.8 billion loss on the securities sale and said it would raise $2.25 billion in capital through two offerings of new shares and a convertible bond offering. That offering wasn’t completed. So this appears to be an example of what can go wrong with a bank focused on a particular industry. The combination of a balance sheet heavy with securities and relatively light on loans, in a rising-rate environment in which bond prices have declined and in which depositors specific to that industry are themselves suffering from a decline in cash, led to a liquidity problem. Banks leverage their capital by gathering deposits or borrowing money either to lend the money out or purchase securities. They earn the spread between their average yield on loans and investments and their average cost for funds.The securities investments are held in two buckets:

  • Available for sale — these securities (mostly bonds) can be sold at any time, and under accounting rules are required to be marked to market each quarter. This means gains or losses are recorded for the AFS portfolio continually. The accumulated gains are added to, or losses subtracted from, total equity capital.
  • Held to maturity — these are bonds a bank intends to hold until they are repaid at face value. They are carried at cost and not marked to market each quarter.

In its regulatory Consolidated Financial Statements for Holding Companies—FR Y-9C, filed with the Federal Reserve, SVB Financial, reported a negative $1.911 billion in accumulated other comprehensive income as of Dec. 31. That is line 26.b on Schedule HC of the report, for those keeping score at home. You can look up regulatory reports for any U.S. bank holding company, savings and loan holding company or subsidiary institution at the Federal Financial Institution Examination Council’s National Information Center. Be sure to get the name of the company or institution right — or you may be looking at the wrong entity. Here’s how accumulated other comprehensive income (AOCI) is defined in the report: “Includes, but is not limited to, net unrealized holding gains (losses) on available-for-sale securities, accumulated net gains (losses) on cash flow hedges, cumulative foreign currency translation adjustments, and accumulated defined benefit pension and other postretirement plan adjustments.” In other words, it was mostly unrealized losses on SVB’s available-for-sale securities. The bank booked an estimated $1.8 billion loss when selling “substantially all” of these securities on March 8.

The list of 10 banks with unfavorable interest margin trends

On the regulatory call reports, AOCI is added to regulatory capital. Since SVB’s AOCI was negative (because of its unrealized losses on AFS securities) as of Dec. 31, it lowered the company’s total equity capital. So a fair way to gauge the negative AOCI to the bank’s total equity capital would be to divide the negative AOCI by total equity capital less AOCI — effectively adding the unrealized losses back to total equity capital for the calculation. The list of 10 banks that raised similar red margin flags to those of SVB, here’s the same group, in the same order, showing negative AOCI as a percentage of total equity capital as of Dec. 31. We have added SVB to the bottom of the list. The data was provided by FactSet:

Bank Ticker City AOCI ($mil) Total equity capital ($mil) AOCI/ TEC – AOCI Total assets ($mil)
Customers Bancorp Inc. CUBI, -13.11% West Reading, Pa. -$163 $1,403 -10.4% $20,896
First Republic Bank FRC, -14.84% San Francisco -$331 $17,446 -1.9% $213,358
Sandy Spring Bancorp Inc. SASR, -2.91% Olney, Md. -$132 $1,484 -8.2% $13,833
New York Community Bancorp Inc. NYCB, -5.99% Hicksville, N.Y. -$620 $8,824 -6.6% $90,616
First Foundation Inc. FFWM, -9.11% Dallas -$12 $1,134 -1.0% $13,014
Ally Financial Inc. ALLY, -5.70% Detroit -$4,059 $12,859 -24.0% $191,826
Dime Community Bancshares Inc. DCOM, -2.81% Hauppauge, N.Y. -$94 $1,170 -7.5% $13,228
Pacific Premier Bancorp Inc. PPBI, -1.95% Irvine, Calif. -$265 $2,798 -8.7% $21,729
Prosperity Bancshare Inc. PB, -4.46% Houston -$3 $6,699 -0.1% $37,751
Columbia Financial, Inc. CLBK, -1.78% Fair Lawn, N.J. -$179 $1,054 -14.5% $10,408
SVB Financial Group SIVB, -60.41% Santa Clara, Calif. -$1,911 $16,295 -10.5% $211,793
Source: FactSet

 

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A Silicon Valley lender collapsed after a run on the bank……. The Dominoes have started to fall… The black swans are back!!

A bank that caters to many of the world’s most powerful billionaire tech investors collapsed on Friday and was taken over by federal regulators, becoming one of the largest lenders to fail since the 2008 Global Financial Crisis. California’s banking regulators shut down Silicon Valley Bank and put it into receivership under the Federal Deposit Insurance Corp. (FDIC). That effectively gives control of the bank to the FDIC, which created a new entity to oversee it.Regulators announced the takeover after what was effectively a run on the bank. Depositors rushed to withdraw their money amid fears SVB wouldn’t be able to meet redemption requests.

It was a collapse that sent shockwaves across the banking industry, hammering shares of other smaller and regional lenders.

Although it was not in the same league as, say, Goldman Sachs or J.P. Morgan Chase, Silicon Valley Bank, or SVB, punched above its weight during its 40-year history. Based in Santa Clara, Calif., its clients included venture capital firms and startups, and it became a big player in the tech sector, successfully competing with bigger-name banks. “They really developed a niche that was the envy of the banking space,” says Jared Shaw, a senior analyst at Wells Fargo. “They are able to provide all the products and services any of these sophisticated technology companies, as well as these sophisticated venture capital and private equity funds, would need.”But it remained little known outside of tech circles — until this week. Silicon Valley’s business boomed as tech companies did well during the pandemic. That filled the lender’s coffers, and SVB had about $174 billion in deposits.

But in recent months, many of Silicon Valley Bank’s clients had been withdrawing money at a time when the tech sector as a whole has been suffering.

Charts blow released by SVB show sharp declines in overall VC investments (top) and the outflow of SVB client funds (bottom) over the past year as interest rates rose:

Charts released by SVB show sharp declines in overall VC investments (top) and the outflow of SVB client funds (bottom) over the past year as interest rates rose

SVB said earlier this week, that in order to make good on those withdrawals, it had to sell part of its bond holdings at a steep loss of $1.8 billion. Bonds and stocks have been hammered since last year, as the Federal Reserve has raised interest rates aggressively, and SVB also noted it wanted to pare down its bond portfolio to avoid further losses. But that announcement spooked the bank’s clients, who got worried about SVB’s viability, and then proceeded to withdraw even more money from the bank — a textbook definition of a bank run. That led to a major slump in SVB’s shares. The bank’s stock price fell by 60% on Thursday, and as its share price continued to sink overnight. Trading was halted on Friday morning, and by midday, SVB had been taken over by the FDIC.

What does this mean for other banks?

Though the problems appear to be isolated (NB:haHaHAHAHAHAHAH) at SVB, the run on the bank sparked concerns about the banking sector as a whole. On Thursday, shares of all kinds of lenders, including the big banks, sagged. J.P. Morgan, Wells Fargo, and Bank of America were all down about 5%. THE treasury said we don’t believe this will spread to other major banks as they are well diversified. What they forget to tell you they are diversified into shit… like, credit card debt, underwater mortgage and $1,000 a month car payments. Soon  you will find out how this will end. Investors feared that other lenders, especially smaller and regional ones, would suffer a similar surge in withdrawals and would struggle to meet the redemptions. The troubles at SVB come as Wall Street had already been on edge. Earlier this week, Silvergate, a California-based bank that caters to the cryptocurrency industry, announced plans to unwind its operations. The FDIC said those with insured deposits with SVB, typically up to $250,000, would be able to access their money by no later than Monday. The fate of those with deposits at SVB that exceed insurance limits is less certain, however, with the FDIC saying they will receive an “advance dividend” for a portion of their funds along with “certificates” accounting for their uninsured funds. The regulator did not spell out what that would entail for these uninsured depositors. Investors will also continue to monitor for any further impact on other banks. The Treasury Department said Secretary Janet Yellen discussed the situation at a meeting she convened with financial regulators.

“Secretary Yellen expressed full confidence in banking regulators to take appropriate actions in response and noted that the banking system remains resilient and regulators have effective tools to address this type of event,” the statement said.Billionaire hedge fund manager Bill Ackman has compared SVB to Bear Stearns, the first lender to collapse at the start of the 2007-2008 global financial crisis. “The risk of failure and deposit losses here is that the next, least well-capitalized bank faces a run and fails, and the dominoes continue to fall,” Ackman wrote on Twitter.  Listen to queen bitch MSSSSS Cathie Wood’s of Ark Invest fund and Fundstrat founder girly guy Tom Lee and your guaranteed poverty in your retirement. Where do they find these fucks? BlackMask Blog:

We got our block swan event
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Wall Street closes lower amid SVB collapse concerns …. You need to be worried

DAVE BRIGGS: A big issue here for us. Let’s break it all down, the risk, what it means for investors. What we have with us, Ken Leon, CFRA Research director of equity research as well as Lee Munson, Portfolio Wealth Advisors president and CIO. Gentleman, good to see you.

Earlier today, Treasury Secretary Janet Yellen said she’s monitoring, quote, “a few banks.” Listen.

JANET YELLEN: There are recent developments that concern a few banks that I’m monitoring very carefully. And when banks experience financial losses, it is and should be a matter of concern.

DAVE BRIGGS: Indeed a matter of concern. Ken, what is the collateral damage here?

KEN LEON: Well, it’s not going to be systemic damage as much as sentiment for the financial sector and banks. We’re seeing that in bank stocks today. Liquidity risk is really what’s front and center. And since the financial crisis, what’s in place, particularly for the largest banks, is diversification with their source of funds, their deposits, how they manage that. And the likelihood is that maybe the Fed this weekend with Janet Yellen is going to be working for a buyer– a potential buyer for SVB Financial. That’s what we think.

SEANA SMITH: Lee, what do you think when you take a look at the losses here, especially what’s happening in some of the regional banks? First Republic, Western Alliance Bancorp, PacWest among the worst performers in that group today. Is there a risk to some of those smaller players?

LEE MUNSON: Yes. Did you see Janet Yellen’s eyes in that clip? Did you see how they got really wide eyed? This is a big deal. Remember, everything counts in large amounts, as Depeche Mode said. We’ve got banks in Silicon Valley, and don’t forget biotech. That’s a huge thing that we don’t really talk about, but you’ve got 93% of the demand deposits over at Silicon Valley Bank were uninsured. You kind of wonder if the tech bros understand the idea of treasury management, which is when your deposit isn’t insured, that’s why you put it in Treasurys, and sometimes historically we got less interest.

So I think that the regional banks over the last few years, regulators have been hands off. They said, let them innovate. Let them try to promote private equity since that’s what all the pension firms are counting on for their underfunded pensions.

And so I think that if you want to play this stuff, I would play the sell-off in the major banks. I mean, come on, you can get Bank of America at one times book value. You buy big banks at one times book and you sell them at two times book. So that’s a better related trade.

The second related trade is go look at mortgage rates. I’ve been into mortgage rates in and out since COVID. Those got smashed up today, and I think that’s a related trade that can do well.

But remember this. These regional banks did not have the handcuffs that the major money-center banks have had since the Great Financial Crisis. When there’s smoke, there’s going to be fire. So I don’t think people should necessarily be bottom fishing. I think none of us here are smart enough to really figure out what bank is going to survive or not, and I think that, you know, if you’re looking at the debt, that is a game for experienced distressed-bond investors. You know, let some guy like Howard Marks figure that out.

But I’ll tell you, there have been so much political contributions by Silicon Valley. We’re going to see if that money is going to pay off because if we see Sunday night the government come in and say, we’ve got to help this out or we’re going to have a cascading problem in private equity, then you know that giving to candidates who are in charge could be a good investment.

DAVE BRIGGS: Ken, I know he had with the Depeche Mode reference there. I know you had them on your Munson bingo card. But what’s your reaction to his thoughts on the regional banks and the regulation as we look in the rear-view mirror?

KEN LEON: Well, it’s all going to depend on scale and size and how aggressive they might have been with the book. You know, ideally, you know, when you’re looking at where you put deposits to work and it’s not loans, it’s Treasurys. You know, so I think the concentration risk here, as noted, is industry specific, and trying to have your foot to the pedal for Silicon Valley or venture-capital health care.

Again, the larger banks or the regional banks are likely to take a step back and think about where they’re putting deposits going forward. This might have a negative impact on the mortgage-backed security market as the Fed is doing quantitative tightening of about $35 billion down on its balance sheet every month. What that means is possibly some of the indirect results of this is higher mortgage rates with less liquidity in the MBS market because banks still are protected by the accounting rule is that they have a liquidity and deposits, which are 20% greater than the industry’s exposure to these investments in Treasurys or mortgage-backed securities. They can keep them as unrealized losses, as noted in their 10-K reports.

But if you ride that road, then the question is going forward probably they’re not going to be doing that or putting more into those categories. It will be very interesting to see how that plays out.

SEANA SMITH: Lee, I know you’re saying in terms of where you’re seeing opportunity right now, you would recommend buying a Bank of America, that they look attractive at current valuations. When it comes to what you should avoid specifically within the regional banks, what is at the top of that list?

LEE MUNSON: Every single regional bank I would avoid. We don’t know what the full extent of demand deposits, which are a much larger part of regional banks’ liquidity, are going to be flying out, not just because of Silicon Valley– this was somewhat of a slow-burner issue that just came to a head this week– but also because you’re looking at your local credit union. You’re looking at your small bank, and you’re saying, why am I getting 2 and 1/2%? Why don’t I yank that out, throw it in my brokerage account, and buy some six-month Treasurys getting 4 and 1/2% or better?

That is what the problem is, and we don’t know– the smartest people in the room do not know how much effect that’s going to be over the next six months, especially when the Fed has made it clear we’re going to keep on it and we’re going to keep raising short-term interest rates. I’ve got clients who are sending me a lot of money, not necessarily to put it in the market but just say can you just put this in a short-term Treasury because I’m not getting anything at my small local bank?

That’s what the concern is, and I think when we talk about contagion, that’s what it’s about. People are using bank– you know, I’ve got a Bank of America account, just for full disclosure. I’m not going to pull $100,000 grand out of it and put it in a six-month Treasury because there’s other reasons why you use a big bank. But the smaller stuff where you have the little passbook savings accounts– remember, this happened in the late ’70s. It’s going to happen again. It’s going to happen right now.

But I agree with Ken. Listen to Ken. He knows what he’s talking about. This is not going to be a full-blown disaster. It’s a regional bank. So just stay out of the group. Find something else to trade.

DAVE BRIGGS: Your reactions to that, Ken? And big banks, Seana mentioned, saw $50 billion trimmed off their market cap on Thursday alone. Any further exposure for them?

KEN LEON: Yeah, so the blanket statement is if you had $100 billion or more in assets, your deposits were safe. It was a good mix of consumer or small business. But SVB Financial was $216 billion. If you read the FDIC release today, press release, the caveat is for those account holders that have more than $250,000, that’s not insured. So that’s step number one.

Step two, take a look at the banks for investing. Where they have diversified deposit mix, they’re going to lose a little bit on spread because they’re shifting from noninterest to interest-bearing deposits or CDs. But it’s a good time to really look more specific, and that’s why CFRA Research is a good source for you to look at.

SEANA SMITH: Lee, let’s talk about what this could mean here for the Fed. Lots of talk about 25 or 50 basis points at the next meeting. Does this make it more likely that the Fed’s going to go 25?

LEE MUNSON: I think it is. You know, I never really bought into this whole 50-basis-point thing. I just think that that was just, you know, everybody’s just getting upset. I think there was a delayed reaction a couple of weeks ago when you saw the 10-year Treasury hit 4%, and then nobody panicked. The markets didn’t collapse. And even I was a little bit like, is everybody on break, spring break?

But I think that idea of 50, I don’t– I think that was just sort of an imagined thing. That idea got away. So I think you’re going to see 25 now. I think in the next meeting in a few months you’re going to see another 25, and that’s it. I don’t think that right now they’re going to really get too aggressive.

But what do I know? All I do is listen to what the people in charge say, and they are gearing towards a 25-basis-point hike.

SEANA SMITH: That’s what we all do, Lee. We all listen to the people that are in charge. Lee Munson, Ken Leon, thanks so much for joining us.

 

 

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FDIC takes over Silicon Valley Bank

US Federal Deposit Insurance Corporation (FDIC) announced Friday that it closed Silicon Valley Bank (SVB) after the institution failed to raise capital to resolve its crisis. According to the release, to protect depositors, the FDIC created the Deposit Insurance National Bank of Santa Clara (DINB), to which it transferred all of Silicon Valley Bank’s insured deposits. “The FDIC will pay uninsured depositors an advance dividend within the next week. Uninsured depositors will receive a receivership certificate for the remaining amount of their uninsured funds. As the FDIC sells the assets of Silicon Valley Bank, future dividend payments may be made to uninsured depositors,” read the statement. In addition, the release also notes that Silicon Valley Bank’s main office and all branches will resume operations on Monday, March 13, 2023. Official Silicon Valley Bank checks will continue to be cashed. NN: SVB the second biggest bank failure in US history… Will it spread? that remains to be seen. The FED will break the system before they fix it.

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Dow plunges 400 pts amid SVB saga, hot jobs report

Major US stock markets extended losses on Friday, driven by the latest US employment report and updates in the banking sector. Earlier, the US Bureau of Labor Statistics reported that total nonfarm employment increased by 311,000 jobs in February, signaling that the labor market may be overheated, potentially prompting the US Federal Reserve to raise interest rates faster. On the other hand, banking stocks have dragged the indexes down after news that Silicon Valley Bank was finally closed by the US Federal Deposit Insurance Corporation (FDIC). The Dow Jones plummeted by 1.24% or 400 points at 1:34 pm ET, while the Nasdaq 100 fell 1.43%, and the S&P 500 dipped 1.55%. The euro improved by 0.69% against the dollar at 1:41 pm ET, selling for $1.06526.

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US nonfarm payrolls up a HOT 311,000 in February

Total nonfarm payroll employment in the United States increased 311,000 in February, the country’s Bureau of Labor Statistics unveiled in its report on Friday, topping market estimates. The unemployment rate grew by 0.2 percentage points from the previous month, to stand at 3.6% in February, with the number of unemployed people rising to 5.9 million. The labor force participation rate edged up by 0.1 percentage points to 62.5%. The leisure and hospitality sector saw the biggest expansion in the workforce, adding 105,000 jobs in February. The retail trade industry generated 50,000 jobs, followed by the additional 46,000 hirings in the government sector. Average hourly earnings for all employees on private nonfarm payrolls rose by $0.08 in comparison to the month before, to reach $33.09 in February, representing an annual growth of 4.6%. NN: hot Hot HOT…. the FED has got to get more aggressive. A 25 bases point increase now Looks like  50 bases points. Tuesday CPI if hot we will be off to the races.

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SVB Investors Spooked Canaries in the coal mine? SVB falls 20% premarket, hurts bank shares globally

SVB Financial Group — which until this week banked almost half of all US venture backed startups — continued its freefall on Friday as the company’s silence about a planned capital raise further spooked investors.  The company — which for months has been adamant that it wouldn’t significantly restructure its balance sheet — stunned investors Wednesday when it said it would issue $2.25 billion of shares and booked a $1.8 billion loss on the sale of substantially all of its available-for-sale securities. After shares of the company plummeted 60% on Thursday, analysts began questioning if the capital raise would even occur.   “What was likely planned to be nothing more than a portfolio restructure and capital raise has turned into a painful vortex of a lack of information along with a healthy dose of misinformation and questions on deposit flow,” Jon Arfstrom, an analyst at RBC Capital Markets, said in a note to clients. He noted the plummeting share price will likely mean the bank will have to issue even more shares, further diluting the stock if the transaction even does occur.

European Lenders Slump After US Peers' Rout | The Stoxx 600 Banks Index drops most since June

Behind the scenes, Silicon Valley Bank executives have rushed to reassure clients even as prominent venture capitalists advised their portfolio businesses to withdraw money. Some customers complained they were unable to make withdrawals on Thursday.  “There is clearly one set of reactions which is let’s move our money and, to be clear, the reason for that is why wouldn’t you looking at a cost-benefit analysis why would you not look to de-risk exposure,” Eileen Burbidge, a partner at Passion Capital Investments, said in an interview with Bloomberg Television. NN:  The only question is does this bank that will fail spread losses up the food chain. Asshole bankers living in zero interest rate world do not understand never mind how to hedge inflation driven interest rate risks. That is why they are blowing blue sky up our asses claiming the fed is done raising rates. As you will see as the Fed continues to raise rates they will fail. and welcome to the world of the next banking crises.

SVB falls 20% premarket, hurts bank shares globally

After cratering over 60% on Thursday, SVB Financial Group continued to fall, losing more than 20% in premarket trade on Friday. Concerns about SVB’s issues potentially spilling over to the entire global banking sector affected other lenders, which were the worst performers on most stock exchanges all around the world. Earlier this week, SVB announced it had sold approximately $21 billion of securities for an after-tax loss of around $1.8 billion. The lender that primarily backs technology start-ups also revealed it will sell a total of $2.25 billion of its common and depositary shares, with equity firm General Atlantic buying $500 million of common stock. SVB’s shares dropped 23.19% in the premarket.

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Russia And Saudi Arabia Vow To Continue OPEC+ Oil Policy Cooperation

  • During the visit of Saudi Arabia’s foreign minister to Moscow, Russia and Saudi Arabia pledged to continue OPEC+ cooperation.
  • The current OPEC+ agreement will remain in place until the end of this year, at which point members will reconsider the situation.
  • Despite Russia unilaterally cutting its oil production and Saudi Arabia’s foreign minister visiting Kyiv, energy relations between the two countries remain strong.

The leaders of the OPEC+ coalition, Russia and Saudi Arabia, pledged to continue close cooperation in oil policy in the group during a visit of Saudi Arabia’s foreign minister to Moscow on Thursday. “We have reaffirmed the mutual readiness for further coordination of efforts in OPEC+,” Russian Foreign Minister Sergei Lavrov said, as carried by Interfax, after talks with his Saudi counterpart, Prince Faisal bin Farhan Al Saud. “All countries participating in this format are consistently fulfilling their obligations to maintain the proper balance and stability on the global energy market,” Lavrov was quoted as saying. The current OPEC+ agreements remain in force until the end of this year, after which the members of the OPEC+ group will consider the situation and make new decisions, Lavrov said. Russia has said it would reduce its oil production by 500,000 bpd this month in response to the Western sanctions, a move that may affect the level of its oil and fuel exports. Yet, OPEC+ delegates have said that the alliance doesn’t plan to change its oil production targets after Russia announced a cut in its output for March.

Saudi Arabia’s foreign minister said today that Riyadh is in close coordination with Russia on energy and is committed to the OPEC+ agreement.

Saudi Arabia is also seeking to strengthen ties with Russia on all levels, the Saudi minister noted during this visit to Moscow. While seeking closer ties with Russia, the Saudi foreign minister has also visited Kyiv recently for talks with top Ukrainian officials, including President Volodymyr Zelenskyy. The visit was the first from such a high-ranking Saudi official to Ukraine in 30 years. During the visit, Saudi Arabia signed agreements for $400 million in aid to Ukraine. The $400-million package includes financing of $300 million worth of oil derivatives as a grant from Saudi Arabia through the Saudi Fund for Development (SFD) in favor of Ukraine, the Saudi Press Agency said. The remaining $100 million will be humanitarian assistance to Ukraine from Saudi Arabia. NN: They are not going to let the oil market crash. And they are the 2 ton guerilla on the block…

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The TRUE inflation rate is >13%, using the BLS 1980’s calculation….. The three major crashes of the last 40 years occurred when inflation popped

The TRUE inflation rate is ~13%, if using the Bureau for Labor Statistics’ original calculation method.

The CPI-U (consumer price index) is the broadest measure of consumer price inflation for goods and services published by the Bureau of Labor Statistics (BLS). While the headline number usually is the seasonally-adjusted month-to-month change, the formal CPI is reported on a not-seasonally-adjusted basis, with annual inflation measured in terms of year-to-year percent change in the price index.In the charts we show two SGS-Alternate CPI estimates: One based on the pre-1990 official methodology for computing the CPI-U, and the other based on the methodology which was employed prior to 1980.

They changed this method in 1980, to deliberately downplay inflation risks and manipulate public opinion. The last time it was at current levels was in 2008, just before the crash…

Markedly higher inflation precipitates recessions and stock market crashes. The three major crashes of the last 40 years (Black Monday in 1987, Dot Com Bubble Bursting in 2000, and the Lehman Shock in 2008) all had periods of sharply rising inflation just prior to them. The fourth one which will be the biggest crash yet is starting right now. For the record I predicted all these crashes and for a fact made my clients/subscribers millions…..

BlackMask Blog:

I hope you will be there with me
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Austin: US, Israel to confront Iran’s ‘aggression’

United States Defense Secretary Lloyd Austin said on Thursday that he and Israeli Prime Minister Benjamin Netanyahu agreed that the two countries should raise the level of cooperation to “confront Iranian aggression,” according to a press release by the Pentagon.

Speaking in Tel Aviv with Netanyahu, Austin also warned that Russia could decide to provide “technology to Iran in exchange for its assistance” in the conflict in eastern Europe.Concerning issues in the Middle East, the American official pointed out that Israel has the “right to defend itself” against “terrorism” and called for de-escalation and a “halt in unilateral actions that undermine” the work with Palestinians and Israelis toward a two-state solution. NN: Every major stock  market wipeout the bubble burst has a trigger. A event that surprises the markets. Two triggers i look at are for example a Chinese land invasion of Taiwan. But the most likely one is a joint Israel US attack on Iran’s nuclear weapons production facilities… Included in the multi target attack the ones deep underground.  The US is deeply concerned about the huge arms shipments including ammunition, rockets and drones from Iran to Russia. And Israel is concerned that soon Tel Alive will be glowing in the dark. I can tell you for a fact that US and Israeli top gun types are in intensive training and Bunker buster munitions have been staged in Israel.