Authored by Greg Hunter via USAWatchdog,
Analyst and financial writer John Rubino has a new warning about the financial health of the global economy, and it's not good.
Look no further than the most recent revelations of money problems at some of the biggest banks in the world. Rubino calls what we are facing is the "Perfect Storm" for banks. Rubino explains, "There are a lot of bad things happening in the banking sector right now kind of all at once..."
" So, you do have the potential for a perfect storm. I'll just go through a few of them. First of all, banks in the US own $4 trillion to $5 trillion in US government paper . . .. They use Treasury bonds as their safe asset. When interest rates go up, the price (or value) of the bonds goes down. This means there are a lot of unreported losses on bank balance sheets...
If those things find their way into earnings reports, which they will, then you have to count the losses. That is scary for the banks because they will have to report losses, and that spooks the depositors and you get bank runs. That is just there waiting to happen. Then, there are the subprime auto loans that are going bust at an accelerating rate... That's $1.7 trillion or so the banks have to worry about. Then, the
