Posts Tagged ‘bad loans’

Fed Z1: Blah

Fed Z1: Blah

Courtesy of Karl Denninger at The Market Ticker 

Well, there’s nothing here that indicates any sort of real change.  Let’s start with the grand-daddy chart:

The arrow is approximately where the outstanding credit in the system began to decline.  Note that the slope of each sub-component hasn’t done much in terms of change in this last report.

Has there been ANY improvement?  Let’s zoom in:

debt

Well, not really.

Households and non-profits contracted their outstanding credit by $60 billion in non-mortgage instruments and a sizable $99 billion in mortgages.  Non-financial business credit expanded very slightly (about $30 billion in the quarter) as did state and local governments ($25 billion.)  Interestingly enough it appears that farm credit decreased while non-farm increased – I will do some more digging in that area, as it may be a leading indicator of distress in the farm space – particularly family farms.  The Federal Government increased its debt by a net $361.5 billion (!) while financial instrument credit decreased awhopping $638.5 billion.  Rounding out the numbers is the rest of the world (exposure in the US), which was up a modest $28.6 billion, continuing a trend that has run since the end of 2008.

All-in all, nothing to see here.  Anyone who claims that "activity in credit is increasing" has to explain how, when consumers and non-financial businesses continue to de-lever and financial instruments are literally being shunned like a leper colony - the contraction this quarter ran at a seventeen percent annualized rate while the actual annual rate of change over the last 12 months is only 13.5%.  In other words, the deleveraging is accelerating, not stabilizing, among financial instruments.

As for the "de-levering" of the consumer, that’s still to come.  Outstanding credit has contracted a mere 2.7% since this mess began with credit peaking in the second quarter of 2008, or about 1.5% annualized.  Mortgages have delevered only 3.7% from the top in the first quarter of 08 in total, or about 1.9% annualized.

The short form here folks is that all the "prop jobs" have been intended to do one thing and one thing only - protect the banks from having to recognize their bad loans.

To believe that consumers and non-profits could have only de-levered at a rate of less than 2% annualized including all the bad mortgage debt that is out there, and is now "recovering", is not only ludicrous but is utterly unsupported by the data, which is not showing the alleged "growth."

What has…
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One Tenth of US Banks Now on FDIC’s “Problem” List

One Tenth of US Banks Now on FDIC’s "Problem" List

Courtesy of Jr. Deputy Accountant 

Or so says the WSJ:

A total of 775 banks, or one-tenth of all U.S. banks, were on the Federal Deposit Insurance Corp.’s list of "problem" institutions in the first quarter, as bad loans in the commercial real-estate market weighed on bank balance sheets.

Poor loan performance in other sectors also continued to hurt banks, with the total number of loans at least three months past due climbing for the 16th consecutive quarter, FDIC officials said in a briefing on Thursday.

"The banking system still has many problems to work through, and we cannot ignore the possibility of more financial market volatility," FDIC Chairman Sheila Bair said.

There were 702 on the FDIC’s "problem" bank list at the end of 2009 and 252 at the end of 2008.

Looks like Bank Fail Friday is on for the foreseeable future! 


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Zero Hedge

"Risk Of Imminent Whipsaws": BofA's Regime Indicator Is In The Last Month Of Its "Downturn" Phase

Courtesy of ZeroHedge View original post here.

A little over a month after the early September quant quake, which sent momentum and growth stocks plunging and value stocks surging...

... things are largely bank to normal, with growth continuing its steady outperformance (despite the occasional ...



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Phil's Favorites

Oil companies are thinking about a low-carbon future, but aren't making big investments in it yet

 

Oil companies are thinking about a low-carbon future, but aren't making big investments in it yet

Oil pump jacks in Williston, N.D. AP Photo/Eric Gay

Courtesy of Lewis Fulton, University of California, Davis and Daniel Sperling, University of California, Davis

The global oil industry stands at a crossroads. Corporate leaders are weighing how closely to stay wedded to their legacy business ...



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Kimble Charting Solutions

S&P Needs This Key Indicator To Experience A Breakout!

Courtesy of Chris Kimble

Is a leading Tech sector about to send the broad market a key message? In our opinion, yes!

This chart looks at the Semiconductor/S&P ratio over the past couple of years.

When the ratio peaked around March of last year at (1), numerous indices in the states (NYSE, Mid-Caps, Small Caps) and around the world (EEM & EFA) started to create a series of lower highs.

The SMH/SPY ratio is again testing the highs of early 2018 at (2).

Many indices in the states and around the world, need this ratio to continue to move higher/experience if the...



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Insider Scoop

A Peek Into The Markets: US Stock Futures Down; Crude Oil Falls 1%

Courtesy of Benzinga

Pre-open movers

U.S. stock futures traded lower in early pre-market trade. The FHFA house price index for August will be released at 9:00 a.m. ET.

Futures for the Dow Jones Industrial Average dropped 27 points to 26,736 while the Standard & Poor’s 500 index futures traded fell 2.75 points to 2,991.75. Futures for the Nasdaq 100 index fell 5.25 points to 7,853.50.

...



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Digital Currencies

Blockchain voting is vulnerable to hackers, software glitches and bad ID photos - among other problems

 

Blockchain voting is vulnerable to hackers, software glitches and bad ID photos – among other problems

How secure is online voting with blockchain technology? WhiteDragon/Shutterstock.com

Courtesy of Nir Kshetri, University of North Carolina – Greensboro

A developing technology called “blockchain” has gotten attention from election officials, startups and even Democratic presidential candidate Andrew Yang as a ...



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Lee's Free Thinking

Repo Market Bank Regulations and the Slings And Arrows of Outrageous Leverage

 

Repo Market Bank Regulations and the Slings And Arrows of Outrageous Leverage

Courtesy of 

Are repo market regulations really behind the money market’s problems? That’s what bankers and their hired mouthpieces are saying.

So I need to get a few things off my chest about this notion that post financial crash Dodd-Frank bank regulations are the cause of the current repo market problems.

It’s total bullsh*t. The bankers and their superleveraged hed...



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The Technical Traders

Daily Market Forecast and Trading Patterns

Courtesy of Technical Traders

CLICK HERE TO GET REAL TIME TRADE ALERTS!

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Chart School

Gold Stocks Review

Courtesy of Read the Ticker

Gold stocks are swinging back forth between the range, and a break out swing higher is due. Gold stocks are holding a near perfect Wyckoff accumulation pattern. All should get ready to play this sector. Yet we must recognize that gold stocks are a one of the most crazy rides at the stock market fair, so play very carefully.

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GDX PnF chart from within the video

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Important channels around the HUI.
...

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Biotech

The Big Pharma Takeover of Medical Cannabis

Reminder: We are available to chat with Members, comments are found below each post.

 

The Big Pharma Takeover of Medical Cannabis

Courtesy of  , Visual Capitalist

The Big Pharma Takeover of Medical Cannabis

As evidence of cannabis’ many benefits mounts, so does the interest from the global pharmaceutical industry, known as Big Pharma. The entrance of such behemoths will radically transform the cannabis industry—once heavily stigmatized, it is now a potentially game-changing source of growth for countless co...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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