We passed the milestone of 100 bank failures in a year on Friday. That hasn't been done since 1992, and we still have a couple months to go.
However, that isn't the best way to measure the problem.
More banks have failed in other years. The post-war record was set in 1989 when 534 banks went under. That was at the peak of the savings-and-loan (S&L) crisis, which erupted in the late 1980s and continued in the early 1990s. This year has seen more failures than any since 1992, but another 75 banks must go under to overhaul that year’s total.
Counting absolute numbers of failures, however, is not the best way to assess the extent of a financial crisis. The number of banks and thrifts has fallen dramatically since the S&L era, from some 16,000 lenders then to around 8,000 now. According to CreditSights, a research firm, when the current cycle is over, the rate of bank failures may be double what it was during the S&L crisis.
The total of failures also disguises the size of individual collapses. The demise of Washington Mutual, the biggest bank to fail in America so far in this crisis, means that banks accounting for more than 3% of the system’s total assets have fallen during the current cycle already, compared with 4.4% of assets over the entire S&L episode.
There are 416 banks on the FDIC's problem list. I don't think there is any question that we shall exceed the levels of the S&L crisis by a wide margin when measured in assets.
And the other shoe is about to drop.
Commercial real estate market is searching for a bottom.
RebelCapitalist.com - Financial Information for the Rest of Us.
RebelCapitalist.com - Financial Information for the Rest of Us.
I don't believe we have paid off the S&L crisis yet either
All, I am sick with the Swine flu, which is why my writing is light.
I hope ya all can pick up the slack.
But I saw a blurb on some talking head show saying we have not paid off the S&L crisis yet...
so the long term financial consequence...I feel the nation is still in denial over this entire thing.
Get well soon.
Dont' watch or listen to the talking heads that will only lower your immune system.
RebelCapitalist.com - Financial Information for the Rest of Us.
RebelCapitalist.com - Financial Information for the Rest of Us.
Pain killers are a must if
you've got it.
Otherwise you'll have a splitting headache. Keep hydrated, and get well.
even the Instapopulist
even small little quotes on major economic events will help.
I know we have daily readers expecting us to be "on it" on key events.
The doc. prescribed killer cough syrup. "House" would love it.