U.S. Treasurer Janet Yellen has outright admitted that the U.S. government and Federal Reserve will readily protect and bailout any bank that are in their good graces and/or to protect their own interests, whiles the smaller community and regional banks will be allowed to fail with no support coming.
Yellen made these sentiment clear during a recent hearing before a Senate Finance Committee on Thursday. Her critical statement has gone virtually unreported by mainstream press.
Wallstreet Silver however posted the short clip that revealed what will happen as more banks begin to fail.
Senator James Lankford of Oklahoma asked Yellen point-blank if all the banks in Oklahoma, regardless of their size, will be fully-protected and receive a bailout similar to what Silicon Valley Bank and Signature Bank recently received. In short, Yellen basically gave a roundabout way of saying the FDIC, Federal Reserve, and government will not be there to help any bank unless they feel it is in their best interest to do so. In other words, the bigs will get saved but the smalls will not.
A bank only gets that treatment if a super-majority of the Fed board, and I, in consultation with the President conclude that failure to protect uninsured depositors would create systemic risk to the banking system.
But Lunkford did not stop there, asking what is Yellen’s plan to prevent large depositors in smaller banks from transferring their assets to larger institutions – fearing that what the government and Fed has done has set a precedent that the government will only make the preferred banks whole but not the smaller ones.
Lunkford: We have seen the mergers of banks over the past decade – I’m concerned you’re about ready to accelerate that, by encouraging any that has a large deposit in a community bank to say, ‘We’re not gonna make you whole, but if you go to one of our preferred banks we will make you whole at that point.’
Yellen: [Stammers] That’s certainly not something we’re encouraging –
Lunkford: That is happening, right now.
Yellen: That is happening because depositors are concerned about the bank failures that have happened, and whether or not other banks could also fail –
Lunkford: No, it’s happening because you are fully insured no matter the amount is, if you’re in a big bank: you’re not fully insured if you are in a community bank.
Yellen: Well, you’re not fully insured –
Lunkford: But you were at Signature – it just barely met that threshold – you were [insured] at Signature.
Yellen: Well, we felt that there was a serious risk of contagion that could have brought down and triggered runs on many banks, and that’s something given that our judgement is that the banking system overall is safe and sound – depositors should have confidence in the system.
The conversation went
In response to this Mark E. Jeftovic for Bomb Thrower succinctly said:
Once again, the government is picking winners and losers; just like under lockdowns, when they shut down small businesses and forced everybody into Costco and Wal-Mart. “It’s called stakeholder capitalism”, I’ve mused, “and you’re not a stakeholder”.
Well, this time they’ve blown up the banking system real good – and this time they may not be able to kick the can down the road. They may not even be able to save the “Too Big To Fail” banks by the time this is all over.
He wrote, emphasis his
On Monday The WinePress documented that large bank runs began to occur at smaller institutions, as a transfer of capital and assets began to move into larger banks.
But as Lunkford pointed towards, bank runs are happening in large amounts; so much so, ZeroHedge reported that a whopping $550 Billion in deposits have been yanked in just this week alone. Furthermore, banks have borrowed $165 billion from the Federal Reserve this week, too – a number so large that according to Forbes surpasses the $111 billion high recorded in 2008 during the financial meltdown that year.
SEE: 666 Million Worth Of Assets Held By Swedish Pension Firm Tied-Up In Collapsed American Banks
Prior to this statistic being released, First Republic, another one of the banks in deep trouble and on the verge of collapse as well, and facing bank runs of their own – were “rescued,” as mainstream media called it, by 11 of the largest banks in the country by gifting the bank $30 billion to cover deposits.
We would like to share our deep appreciation for Bank of America, Citigroup, JPMorgan Chase, Wells Fargo, Goldman Sachs, Morgan Stanley, Bank of New York Mellon, PNC Bank, State Street, Truist, and U.S. Bank. Their collective support strengthens our liquidity position, reflects the ongoing quality of our business, and is a vote of confidence for First Republic and the entire U.S. banking system.
In addition, we want to share our sincerest thanks to our colleagues, clients, and communities for their continued and overwhelming support during this period.
Jim Herbert, Founder and Executive Chairman, and Mike Roffler, CEO and President of First Republic Bank said
But stock market analyst and expert Greggory Mannarino has called the media’s bluff on this, and has asserted that this money is only designed to cover the bank runs that are facing First Republic, which will ultimately flow back into the original 11 megabanks per this consolidation and monopolization of the banking system.
AUTHOR COMMENTARY
The poor is hated even of his own neighbour: but the rich hath many friends.
Proverbs 14:20
I say it all the time and rings true again: “It’s a big club and you ain’t in it!” This is a crime syndicate of the highest order. These people get to bailout their buddies, but the little banks can be allowed to fail. The so-called “too-big-to-fails” are only that way, not because they are immune to collapse and failure, but because their rich friends in the banking cartel will come to their rescue. So the bigs will get saved and protected no matter what, or whatever other assets and institutions they want to spare; but the little plebs can get steamrolled and be forced to do bail-ins; and the bigs can eat up the smaller ones.
As I have been warning about, this is a very clear consolidation and monopolization of power. The banks are as safe as trying to defuse to a timebomb with a hundred wires and no cutters. This is why I have been warning people to get their money out of these banks big and small since The WinePress started. The system is illiquid and insolvent, and the banks cannot take the crunch after these small rate hikes, as the banks have no deposits (prior to this past week), no savings, and no loans.
A LOT of people are about to get screwed, really badly. The media is trying to sell you a bag of lemons: don’t fall for it. But those who have been watching and taking action should be able to rest easy, for you knew this was coming.
[7] The rich ruleth over the poor, and the borrower is servant to the lender. [16] He that oppresseth the poor to increase his riches, and he that giveth to the rich, shall surely come to want. Proverbs 22:7, 16
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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