All articles tagged with #us banking crisis
JP Morgan is cutting around 1,000 jobs, or 15% of the workforce, at First Republic Bank after buying the failed lender earlier this month. The affected employees will receive pay and benefits for 60 days, along with a package which includes a lump sum payment and other benefits. First Citizens, which bought the US unit of another troubled lender, is also planning to cut around 500 roles held by former Silicon Valley Bank workers.
Bitcoin's price is heading towards the $28,000 support level due to market volatility caused by the US banking crisis. The recent uptick in Bitcoin's price is due to the unease caused by the second major bank failure in the US and the disappointing Q1 earnings report of PacWest Bancorp. BTC/USD is gaining momentum and approaching the crucial $30K mark. Bitcoin's technical aspects remain stable, with BTC's trading largely consistent with the price prediction. If BTC manages to break above the $29,600 mark, we may see its price heading north toward $30,400.
Warren Buffett has said that executives who led the US banking system into crisis should face “punishment” as the American economy grapples with the worst series of bank failures since the 2008 financial crash. Buffett criticised how politicians, regulators, and the press had handled the recent failures of Silicon Valley Bank, Signature Bank, and First Republic Bank, saying their “very poor” messaging has unnecessarily frightened depositors. He also expressed caution about holding bank stocks and had recently reduced his exposure to the sector – with the exception of Bank of America, which he liked.
A strategist at Swedbank has warned that the US regional banking crisis is spreading, with Pacwest Bank, Western Alliance Bank, and First Horizon Bank all having been subject to financial meltdowns. The Swedbank strategist further cautioned that a vicious spiral may be about to take hold. Despite multiple bank failures, Federal Reserve Chairman Jerome Powell stated that the US banking system is "sound and resilient" as Fed officials raised interest rates by 25 basis points this week.
The collapse of three US banks in as many months has raised concerns about the health of the US economy, which has just witnessed one of the biggest bubbles of the past 100 years. While the White House maintains that the US financial system is fundamentally sound, the rapid increase in interest rates has taken official borrowing costs from near zero to more than 5% in little more than a year. The Federal Reserve is expected to start cutting rates in July, but the markets are getting ahead of themselves. The longer rates stay high, the tougher life gets for vulnerable banks, and the Fed will eventually cut interest rates aggressively, but by then it will be too late to avoid a hard landing.
The US banking crisis has caused gold prices to surge, with the precious metal nearing its all-time high. Investors are turning to gold as a safe haven amid economic uncertainty and market volatility. The trend is expected to continue as the pandemic continues to impact the global economy.
Bitcoin (BTC) reached a new May high of $29,529 on Bitstamp, with traders eyeing a potential breakout above $30,000. The recent US banking crisis, which has impacted several regional banks, has caused market jitters and shaped observer sentiment. The Federal Reserve's recent interest rate hike has led to market expectations predicting an end to the hiking cycle. Traders are optimistic about BTC's upside continuation, with some setting more conservative levels to return as support.
Cryptocurrency markets have been trading within a tight range due to regulatory uncertainty and the US banking crisis. The lack of risk appetite is likely due to conflicting forces. The recent crypto sideways trend suggests that investors are hesitant to place new bets until there’s more clarity on whether the US Treasury will continue injecting liquidity to contain the banking crisis, which favors inflation and positive momentum for scarce assets. The options market shows whales and market makers unwilling to take protective puts even after Bitcoin crashed 7.8% on May 1. However, given the balanced demand on futures markets, traders seem hesitant to place additional bets until there’s clarity on whether the US Treasury will continue to bail out the troubled regional bank sector.
Shares in California lender PacWest plummeted by as much as 60% amid fears of a new US banking crisis. The bank is in talks with several potential investors and has not experienced out-of-the-ordinary deposit flows. The US regional banking system is at risk, according to Bill Ackman, CEO of the New York hedge fund Pershing Square. Smaller, regional banks play a much larger role in the American economy, accounting for nearly half of consumer and business lending. JP Morgan recently acquired a majority of First Republic’s assets in a $10.6bn deal after regulators seized the lender, which became the largest US bank failure since the 2008 financial crisis.
Bitcoin reclaimed $29,000 as US regional bank stocks suffered and gold hit new all-time highs due to the Federal Reserve's decision on interest rates. Bitcoin's bullish counterpoint to recent price action has market participants hoping for further liquidity squeezes, fueling a trip above the $30,000 barrier. Bitcoin continues to outperform gold, according to Glassnode data.
Bitcoin's price is struggling to maintain support at $28,000, with $30,000 feeling increasingly out of reach. Analysts predict that BTC's price targets are $25,000 and $30,000, with big volatility on the horizon. The upcoming Federal Reserve decision on interest rate policy is causing fear and uncertainty in the market, with a 97.4% chance of a 0.25% rate hike. Meanwhile, the US banking sector is experiencing a resurgent crisis, but Bitcoin is not capitalizing on the fallout.
Chinese economic data, including Q1 GDP, will be in focus this week as investors weigh whether the US banking crisis is over or if there's more trouble ahead. The Asian calendar on Monday is light, with only Indonesian trade and Indian wholesale price inflation potentially moving markets. Meanwhile, the G7 foreign ministers summit in Japan, India's WPI inflation figures for March, and ECB President Christine Lagarde's speech in New York could provide more direction to markets.
Western Alliance Bancorporation reported an 11% decrease in deposits for Q1 2022, with total deposits at $47.6 billion as of March 31, down from $53.6 billion at the end of 2021. The drop in deposits was due to customers withdrawing funds after the collapse of two mid-sized U.S. lenders last month. The announcement helped the company's stock regain some lost ground before it closed 12% lower at $29.37. U.S. banks will kick off first-quarter earnings next week, with investors expected to watch their balance sheets closely for any signs of stress.
JPMorgan CEO Jamie Dimon has warned that the US banking crisis is ongoing and its impact will be felt for years to come. He said that the market's odds of a recession have increased and that the banking system is under renewed stress after the failure of Silicon Valley Bank and Credit Suisse's rescue by UBS last month. Dimon also called for "thoughtful" new regulations in response to the latest turmoil, including clearer rules for dealing with failed banks.
JPMorgan Chase CEO Jamie Dimon has criticised US banking regulators for failing to see risks that were "hiding in plain sight" and giving incentives to lenders such as Silicon Valley Bank to stock up on Treasury bonds, the value of which tanked as the Federal Reserve hiked interest rates. Dimon warned that the repercussions of the collapse of Silicon Valley Bank and other lenders will be felt for years to come, but said it won't be like 2008 and that regulators shouldn't overreact. He also sounded an optimistic note about the US economy, citing "10 years of home and stock price appreciation" as well as wages that are "going up, particularly at the low end."