The media is blowing up over bank failures and fear is back in the marketplace. But most every bank I speak to and I literally speak to 50 or more banks a week, are all very healthy on their balance sheets. Some are still aggressively hiring…this is not the actions of a group in trouble. The media is blowing this up but the truth, from what I can see on the inside, is it is just noise. Silicon Valley Bank (SVB) was a technology driven bank that made plenty of skeptical loans including outright venture capital. What you take from it is not that a bank failed and a system is in trouble, but that technology, the market leader, is screaming that trouble is ahead. And I do think trouble is ahead.
Credit Suisse is more problematic, and bears watching if other European banks falter but here in America, most banks have healthy balance sheets.
I think the real story is China. Xi is having a 3 day meeting in Russia with Putin this week after inking a peace treaty between Iran and Saudi Arabia last week which was basically ignored because of the bank panic. But I think this has MUCH deeper ramifications for us in the US then SVB. China is the big consumer of oil from both the Arab nations(hence why they had the clout to bring that treaty) and Russia. Something is in the works and it is not a peace treaty with Ukraine for Russia as the media may say.
When you lay this China action against a back drop of our government debt ceiling battle that is coming up, the Fed is now losing money for the first time in it’s history, and we can not pay our bills without borrowing at least $2 Trillion dollars a year…it all spells trouble.
Watch for Russia and the Arab Nations to unite and determine that oil must be bought in Yuan or some Chinese Crypto currency, effectively ending the Dollar as the reserve currency for the world. This has massive ramifications for everyone in the US. My gut tells me it will happen before summer is over.
I could be wrong, and I am not going to sit here and try to tell you what to invest in…that is not my job. I am just sharing what I am seeing, and what the media is not talking about, but it is right in front of our eyes.
Something big is brewing…keep an eye out for it.
And remember, God works ALL things for good. Even this will be used for His Glory and will strengthen and grow true Christians, we can go into our days with peace no matter what. And that is a good place to be.
Have a blessed week!
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Karen Schimpf
Commercial Capital, Ltd.
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