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Experts Predict More Bank Failures in the US Following Interest Rate Hike and Unsettled Banking Crisis

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After the recent bank collapses in the U.S., a number of people believe that more failures are coming following the Federal Reserve’s increase of the benchmark interest rate by 25 basis points (bps). American journalist Charles Gasparino insists that Wall Street’s “low-rate” junkies are ignoring the U.S. banking crisis. Quill Intelligence CEO Danielle DiMartino Booth asserts that the banking industry is facing problems that “nobody wants to call a banking crisis.”

Ignoring the U.S. Bank Crisis

There have been numerous opinions and statements from financial experts and officials following the failures of three major U.S. banks. All four major benchmark stock indexes ended the day in the green on Friday after the Federal Reserve raised the federal funds rate by 25 basis points two days earlier. Journalist, radio host, and financial commentator Charles Gasparino wrote an opinion editorial over the weekend that claims the “modern-day stock market is an addict.” Gasparino believes that higher rates are “painfully exposing” a “rot inside the banking system.”

He adds that commercial bankers took “wild gambles,” and the failures of Silicon Valley Bank and Signature Bank highlight the issue. “There will be others, as many as two dozen, I am told,” Gasparino explains. “All have balance sheets remarkably similar to SVB and Signature. If things continue to go south, they are ready to fold, too, guaranteeing a steep recession.” Coincidently, a paper published on March 13 by researchers at New York University shows that U.S. banks had unrealized losses of $1.7 trillion in Dec. 2022.

The reporter’s opinion editorial

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Author: Jamie Redman

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