US banks and default
US banks and default
Depositors have pulled US$ 910 billion (A$1.36T) out of the US banking system since May last year according to stats compiled by the Federal Reserve. The Fed also reported that 700 American banks face “significant safety and soundness risk” due to unrealized losses that exceed 50% of their capital. The central bank blamed its own interest rates hikes as the major cause. However legendary investor Paul Tudor Jones tips the Fed will not raise interest rates any higher this year. “I think they're done. They could probably declare victory now because if you look at CPI it's been declining 12 straight months, that's never happened before in history.” In Australia, Financial Review columnist Christopher Joye argues we are set to see more rate hikes given our rates are well below international peers while our inflation rate is just as high.
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