Peter Schiff delves into the topic of the current state of US Consumers, highlighting their reliance on external support to sustain their spending habits. He emphasizes the fragility of the situation, suggesting that without this support, consumers would struggle to maintain their current level of consumption. Schiff’s analysis underscores the importance of understanding the underlying factors contributing to this dependence and the potential consequences if this support were to be withdrawn.
Sean Foo discusses the recent announcement by the ECB regarding their intention to reduce rates in June. However, this development is not viewed positively as it signifies the weakness of Europe’s economy and the need to stimulate it once again. Unfortunately, this poses a challenge for the Fed as rate cuts may not occur until 2024, prolonging the risk of the US economy facing significant challenges. By the time these cuts are implemented, it might be too late to prevent potential consequences. It is crucial to be aware of these circumstances and their implications.
According to data from the U.S. Courts, Bankruptcies are severely affecting both average American families and U.S. businesses in 2024, as reported by Epic Economist. The burden of higher consumer prices has forced Americans to accumulate substantial amounts of debt in order to sustain their livelihoods. Meanwhile, businesses are grappling with reduced sales and declining profits, all while facing escalating costs. This credit crisis has now escalated to levels reminiscent of the Great Recession, prompting major banks to tighten their lending standards in an effort to mitigate further losses and potential failures in the coming months.
Lena Petrova delves into the topic of the DOLLAR COLLAPSE, shedding light on the IMF’s warning about the potential consequences of global fragmentation along geopolitical lines and the process of dedollarization.
Steven Van Metre sheds light on the pressing concern raised by Morgan Stanley regarding an imminent crash.
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Peter Schiff
May 11, 2024
US Consumers Are on Life Support
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Sean Foo
May 12, 2024
The ECB has signalled they are cutting rates in June, but this isn’t good news. It’s admission that Europe’s economy is weak and it’s time to goose up the system again. This is bad news for the Fed because rate cuts might not even come in 2024. Staying higher for longer is pushing the US over the cliff and by the time the cuts come in, it might already be too late. Here’s what you must know!
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Epic Economist
May 12, 2024
Bankruptcies are hitting average American families, and U.S. businesses really hard in 2024, according to data from the U.S. Courts. Higher consumer prices are making Americans take on massive loads of debt just to get by, while businesses are being impacted by decreased sales and falling profits at a time costs continue to climb. The credit crisis is now reaching levels last seen during the Great Recession, with big banks tightening their lending standards to prevent further losses and more failures in the months ahead.
In fact, the Board of Governors of the Federal Reserve System reported that bank credit levels have fallen for three quarters in a row, marking the first sustained contraction since 2010. This is only the second such decline in more than half a century. The last one was witnessed during the years of 2008 and 2009, when the world was grappling with the repercussions of the Global Financial Crisis.
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The extended slump in bank lending comes as many Wall Street analysts continue to project a pessimistic outlook for the U.S. economy. “Bank credit is contracting for only the 2nd time in 50 years,” stressed Tilo Marotz, head of liquid assets at German insurer Continentale Versicherungsverbund. The credit contraction means that companies and consumers will have to borrow less, with higher interest rates making it more expensive to take out loans, he explained.
When it’s harder to raise debt, businesses are less likely to go on with spending projects, and consumers are forced to delay big purchases, including cars and homes, which can further drag on economic growth. Record-high interest rates only add assault to injury. Still, the central bank has signaled that it’ll not start loosening monetary policy until it reaches its 2% target. Until then, it will be tougher for households and businesses to access credit, experts say.
Late last month, the Federal Reserve’s Senior Loan Officer Opinion Survey revealed that most banks in the U.S. tightened their lending standards during the past quarter. For businesses, 51% of banks tightened their lending standards for commercial and industrial loans to large and middle market firms, while 68% tightened standards for commercial real estate loans. Since February, commercial real estate loans held by banks have declined by $33 billion due to rising delinquency rates and high exposure to the sector’s ongoing crisis.
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Lena Petrova
May 12, 2024
DOLLAR COLLAPSE: IMF Warns of Global Fragmentation Along Geopolitical Lines & Dedollarization
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Steven Van Metre
May 12, 2024
Morgan Stanley’s Urgent Warning: This is About to Crash
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