This new article has been posted on The Huffington Post today, Wednesday, December 1st. Click on the link to see the article on The Huffington Post.
Big Banks have another major crisis growing beneath the surface!
Banks are again on the verge of a damaging financial crisis and will plead for help from taxpayers despite it being the product of their own greed. Financial institutions are horrible corporate citizens.
As if the Big Banks, after being saved by the taxpayers, The Federal Reserve, and FASB (Financial Accounting Standards Board), didn’t have enough to worry about with the ongoing foreclosure nightmare possibly costing over a hundred billion dollars, another problem is brewing that is not being talked about.
Huge banks still have huge problems masked by TARP, The Fed’s quantitative easing, FASB’s change of Mark to Market accounting, and changes as a result of FinReg passed by Congress.
Bank’s problems include: questionable foreclosure procedures, defaulting mortgages, the repurchase of toxic assets, investors demanding recourse for fraudulent securitized instruments, a potential change in FASB rules forcing aggressive markdowns, and exposure to the European crisis.
Each element, on its own, could change the landscape of banking and plunge us into another financial crisis. The convergence of any two, especially with the uncertainty of the foreclosure mess, could destroy the banking system.
Is the banking system really that fragile?