A short number of years ago the “too big to fail banks” had to be bailed out with trillions of dollars in financial aid from both the taxpayers and the Federal Reserve. At one point there were serious discussions about nationalizing the entire U.S. banking industry. As a sign of how rapidly America’s largest banks […]
Fed Says Largest Banks Would Lose Half Trillion Dollars Under Adverse Economic Conditions
March 7, 2013 By Leave a Comment
Based on the results of the Federal Reserve’s stress tests, the nation’s 18 largest banks would collectively lose a massive $462 billion under an extremely adverse hypothetical economic scenario. Reflecting the severity of the stress scenario–which includes a peak unemployment rate of 12.1 percent, a drop in equity prices of more than 50 percent, a […]
The Rally In Big Bank Stocks May Be Over
January 23, 2013 By Leave a Comment
For over the past year, the stocks of big banks have rallied significantly. Lower loan losses, a stabilization of the real estate market and a settlement with the government over shortcomings in foreclosure proceedings have all contributed to a growing conviction by investors that the worst is over for the banking industry. Here’s a look […]
Banks Are A Financial Disaster For Both Shareholders And Depositors
July 27, 2012 By 3 Comments
In days gone by, shareholders of large banks viewed their investments as a source of income via dividends and potential capital gains via share appreciation. In days gone by, depositors viewed banks as the safest place to harbor their hard earned dollars while earning a respectable amount of interest income. That was then, this is […]
What Big Bank Stock Has The Largest Price Gain In 2012?
March 19, 2012 By Leave a Comment
After getting pounded during 2011, bank stocks have soared this year, especially after the Federal Reserve completed its “stress tests” and said that almost every big bank could survive “extremely adverse” economic conditions. During 2011 bank stock shareholders experienced the biggest price declines since the financial panic of 2008. As worries mounted over both the […]
Big Bank CEOs Take Home Massive Paychecks As Savers and Shareholders Get Crushed
March 16, 2012 By Leave a Comment
Right or wrong, most consumers have an overwhelmingly negative opinion about big banks. According to a survey by Research and Markets, 86% of social media comments about U.S. and European banks are negative. The negative perception of big banks by the public has become so pervasive that most bank executives probably just ignore it at […]
Increase In Third Quarter Banking Profits Largely Due To Phony Accounting Gimmicks
November 23, 2011 By Leave a Comment
The FDIC’s Quarterly Banking Profile for the third quarter of 2011 shows banking industry profits increasing by 48% from the third quarter of 2010. Aggregate net income of the banking industry for the third quarter of 2011 totaled $35.3 billion compared to $23.8 billion in the third quarter of 2010. Although traditional news organization headlines proclaimed “Strong Profit Growth […]
Global Financial System Faces Worldwide Bank Runs and Failures, Citigroup’s $300 Billion Problem
October 5, 2011 By Leave a Comment
Three years after the height of the financial crisis, the issue of impaired assets on bank balance sheets remains a major risk to the health of the banking system. Regulators have allowed banks to avoid taking losses on impaired assets by not requiring mark to market accounting. The extent of overvaluation on bank loans can […]
Downward Spiral Of Bank Stocks Is Predicting An Economic Crisis
June 22, 2011 By 3 Comments
After rallying last fall, many of the big bank stocks have seen substantial declines from the beginning of the year. Growing fears about the health of the banking industry are discussed in the latest Economics and Mortgage Market Analysis issued by Fannie Mae. Fannie Mae cites a very weak housing market and an economic slowdown […]
Citigroup Shareholders Lose $16 Billion After Reverse Stock Split
June 2, 2011 By Leave a Comment
On March 21st, Citigroup announced a 1-for-10 reverse stock split, effective May 9, 2011. According to Citigroup CEO Vikram Pandit, “Citi is a fundamentally different company than it was three years ago. The reverse stock split and intention to reinstate a dividend are important steps as we anticipate returning capital to shareholders starting next year.” […]