Half of America’s banks are already insolvent – this is how a credit crunch begins

YahooFinance-The Telegraph/5-2-2023

“Almost half of America’s 4,800 banks have already burned through their capital buffers.… ‘It’s spooky. Thousands of banks are underwater,’ said Professor Amit Seru, a banking expert at Stanford University. “Let’s not pretend that this is just about Silicon Valley Bank and First Republic. A lot of the US banking system is potentially insolvent.’”

USAGOLD note: Evans-Pritchard lays out a scenario considerably more distressing than the picture painted by the bulk of financial media..Some will find the numbers shocking, but it all points to a serious problem that could spin out of control. “The horrible truth,” he says, “is that the world’s superpower central bank has made such a mess of affairs that it has to pick between two poisons: either it capitulates on inflation; or it lets a banking crisis reach systemic proportions. It has chosen a banking crisis.”