Is It Time To Panic? We On The Verge of A Rude Earnings Awakening While Global Financial System Remains Exceptionally Fragile

Tuesday, October 9, 2012
By Paul Martin
October 8th, 2012

Why Bank Earnings Could Face Rude Awakening

Are banks facing a rude earnings awakening?

With JPMorgan and Wells Fargo on tap to report this week, some investors may be questioning whether the depletion of loan loss reserves — the money banks set aside to pay for loans that turn sour — is too premature as credit quality keeps improving. (Read More: 10 Big Bank Stocks Gearing Up for Third-Quarter Earnings.)

A recent report from the Federal Deposit Insurance Corporation showed that banks’ quarterly provisions, or the amount that banks are allocating to these bad loans, have slowed to pre-crisis levels. In the second quarter, the amount set aside by U.S. banks reached its lowest total in five years.

That trend has raised serious concerns among key banking regulators — including those at the Office of the Comptroller of the Currency.

In late September, OCC chief Thomas Curry warned banks that “too much of the increase in reported profits is being driven by loan loss reserve releases” and that the issue “has to be a matter of great concern” as risk levels remain elevated for the industry….

One Of The Biggest U.S. Investment Banks Is On The Verge Of Collapse
Jim Willie’s latest Hat Trick Letter, ‘Firestorms & Currency Twisters‘ is a MUST READ!!
Willie states that Morgan Stanley faces IMMINENT FAILURE & RUIN, that The older employees are selling all of their stock, and that Many workers are making contingency plans for their next positions in another firm.

He states that JP Morgan will devour the carcass, and that The Morgue may be preparing to execute the 1st ever private stock account vaporization/ rehypothecation.


The Rest…HERE

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