The market is looking for the next ‘domino’ to fall, keeping banks under pressure
“The orderly resolution of First Republic by the nation’s biggest lender was supposed to quell concerns about the state of the American banking system, not reignite them.…[A]mid a lack of new news had banking experts casting about for why this was happening.”
USAGOLD note: A lot of red dominoes out there. We would characterize the problem in the banking system as more like a computer virus than a contagion (domino effect). The same problem present in the banks that have already failed infects at varying degrees any number of banks – an underwater, illiquid bond portfolio that cannot be tapped to meet customer deposit withdrawals without significant losses.…… “People are searching for answers, and no one has a good one,” says KBW’s Christopher McGratty.
