Small Banks Lose To Big Banks
The anticipated flow of cash from small banks to large banks has now been reported.
Following the collapse of Silicon Valley Bank on March 10, Fed policies nearly guaranteed that money would move to the infamous SIFI “too big to fail” banks.
The only lingering question… How much?
The Federal Reserve has released its numbers.
News reports vary, but the story is certainly the same.
Billions of dollars moved from small banks to big banks in a single week.
These are my summaries of two of the reports…
March 24 (Reuters)
Deposits at small banks fell by a record $119 billion in the week ended March 15.
That’s more than twice the previous record drop.
It’s the biggest percentage decline (of overall deposits) since the week ended March 16, 2007.
Deposits at large U.S. banks rose $67 billion that week.
Small bank borrowing increased by $253 billion to a record $669.6 billion.
“As a result, small banks had $97 billion more in cash on hand at the end of the week, suggesting that some of the borrowing was to build war chests as a precautionary measure in case depositors asked to redeem their money,” Capital Economics’ analyst Paul Ashworth wrote.
March 27 (Bloomberg)
Weekly data collected by the Federal Reserve showed that large banks gained $120 billion in deposits while their smaller counterparts lost $109 billion.
That decline is the first annual drop for smaller banks since 1986
The Fed continues to move the U.S. economy into a half dozen banks.
This is significant, because it consolidates control.
And it facilitates existing credit-denial attacks against entire industries.
Companies and citizens already conduct transactions, based on what the government allows.
Current examples include Oil & Gas, fertilizer, firearms, and pharmaceuticals.
We do not have a free market.
A new digital currency is being tested, now.
Expect the Central Bank Digital Currency (CBDC) to be introduced, as the dollar collapses.
We are approaching a Dictator’s Dream,
guaranteeing second-to-second control over each individual transaction.