The U.S. banking sector is once again facing a thunderstorm crisis, which is terrifying. The latest news shows that the share price of the New York Community Bank is **50%, triggering a wave of runs. Founded in 1859 and with assets of $120 billion, the bank once ranked among the top 50 in the United States, but its credit rating was downgraded to "junk" by Moody's due to unexpected losses due to commercial real estate exposure. This situation can't help but remind people of the painful memory of the bankruptcy of many banks such as Silicon Valley Bank in 2023. The banking thunderstorm spread, and the small and medium-sized capitalists in the United States are once again in trouble.
As commercial real estate continues, risks in the U.S. banking sector have intensified, and many banks are facing bankruptcy. The interest rate hike policy that began last year has triggered a chain reaction that has exposed the vulnerability of the entire industry. However, the current thunderstorm and the self-purification of the industry provoked by "bad banks" and "bad assets" also make people worry that a financial crisis is brewing. Although the Federal Reserve is stubbornly carrying the burden of not cutting interest rates, whether it can save the crisis has become the focus of people's greatest concern.
In order to contain the contagion of the crisis, the Federal Reserve launched the Bank Term Financing Program (BTFP) to give banks the necessary financial support. However, with the banking sector's massive bond and commercial real estate loans**, the Fed faces unprecedented challenges. According to statistics, the scale of Treasury bonds and agency bonds held by US commercial banks has exceeded 4 trillion US dollars, and the scale of commercial real estate loans has reached almost 7 trillion yuan. Once the thunderstorm comes, even if the Fed does not hesitate to turn on the money printing press, it may be difficult to resolve the crisis, which makes people worried about the future trend.
In the face of a crisis, a Wall Street friend reveals an unusual financial philosophy in the United States. He pointed out that financial crises often stem from the bursting of bubbles, and the Fed's interest rate hike policy is only squeezing the bubble, removing "bad banks" and "bad assets", and realizing the self-purification of the industry. There may be some truth to this interpretation, but it is doubtful that if a large-scale banking crash can be attributed to the clean-up of the industry, rather than to the financial crisis.
In the face of a possible financial turmoil, people have begun to ask what the future of American finance will be. If the banking thunderstorm continues to spread, the U.S. financial system will be put to the test like never before. And after Fed Chair Jerome Powell's insistence that a banking crisis was unlikely, the outlook for the future became even more worried. The question that 2024 will be the year of the crisis in the United States is chilling.
At a time when the global economy is in turmoil, the U.S. banking sector is once again in turmoil, prompting deep thinking about the future of finance. As an important part of the financial system, the stability of banks is critical to the entire country and the global economy. The uniqueness of the American financial concept has also brought people unusual thinking. On the road ahead, it will take a concerted effort between **, regulators, and the banking sector itself to defuse the current crisis and rebuild financial stability. Only on the basis of cooperation and trust can the financial system continue to develop and inject impetus into the healthy development of the social economy. I hope that the future of finance will be smoother, and that finance will become a booster of economic growth, rather than a breeding ground for risks.