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1st sign of impending collapse??

BAMAboy18

Gunny Sergeant
Full Member
Minuteman
Oct 11, 2020
881
675
Wells Fargo just announced it's shutting down lines of credit.
Is our bubble fix'n to burst, again? I got caught with my pants down in '08. I'm no longer in a "luxury" business, and barely carry any debt (a '16 Frontier), nor does my livelihood depend on others debt.
I think anyone with any common sense has seen this coming...
 
Yes it is, however what I'm hearing is this is how it started in '07-08. Back then I was riding high, and it forever changed my life.
 
Yes it is, however what I'm hearing is this is how it started in '07-08. Back then I was riding high, and it forever changed my life.
No, the difference is credit is harder to earn.
Why shouldn't the bank ask for something to back the loan up with instead of being called racist for protecting themselves because they denied a loan.
 
It definitely says something. I am not sure it is a major signal, but clearly Wells is seeing something they don't like in that line of business. But it could be other than what the credit on the books looks like. They could be foreseeing regulatory changes that make the line of business a shitty one to be in, like pressure to give loans based on other than financial metrics. It's definitely something to keep an eye on, whether looking at their comments on it, if they make other portfolio changes, or if other banks follow suit.

I started out as a banking and insurance analyst, and honestly I could not even begin to value one of these big banks now. Nobody can. They are just super complicated, so it's hard to know what kind of piece of the puzzle this is. But I think the OP is right. It is not a great sign.
 
The line has to be drawn somewhere, many are running out of there Covid cheese and applying fir the next one. Wells Fargo don’t want to be Peter
 
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Wells fargo has been running illegal scams in thier customers for a long time. They are under heavy regulations and scrutiny. They just can make it work with the requirements they have to meet. This isnt any kind of sign in general. I'm actually surprised they are still in business.
 
It’s not the best situation, agreed. It says that WF for some reason has determined that the ROI on LOCs are not acceptable at a gross level to cause a change of course as a corporation. That’s a pretty big move as that is a legit revenue stream they are taking off the table.
 
Maybe.....all those "reported" COVID 19 deaths ( sarcasm ) can't be written off to the Feds as personal lines of credit.
 
Bank of America ended their "Line of Credit" about 3 years ago. That was a nice feature to have. I used it many times when I knew I had a lump sum coming in a few months. Cheap interest to tide me over.

Now, as for :

1st sign of impending collapse??​


I would guess this is about the 300th sign of an impending collapse....
There are several threads going right here on the Hide that are identifying inflation, shortages, etc....
America is heading down the rabbit hole. Your #1 possession is your health. Invest heavily while you have some time.
Stay calm and prepare.
No one is coming to save you.

Hobo
 
Wells Fargo just announced it's shutting down lines of credit.
Is our bubble fix'n to burst, again? I got caught with my pants down in '08. I'm no longer in a "luxury" business, and barely carry any debt (a '16 Frontier), nor does my livelihood depend on others debt.
I think anyone with any common sense has seen this coming...

Wells Fargo should have gone tits up decades ago, so meh
 
I like this news because it correlates with my growing suspicion that we are heading into a contraction. If it contradicted my thinking, I'd discredit or ignore it.

In all seriousness, I do think this is a bad omen for macroeconomic conditions, but I don't know exactly what it means. It seems like this book of business would be rather small in comparison to other forms of consumer credit (housing, auto, and traditional credit cards), and so maybe this is simply a matter of trimming the bank's overall risk profile. But any form of credit contraction should be viewed as deeply suspicious, given the Fed's attempts to inflate credit availability. I'll wait for another shoe to drop before attempting to extrapolate a trajectory.
 
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Does societal collapse count?

I hear ole creepy uncle Joe just recently signed an order exempting pregnant illegal alien women, nursing women, and women who have given birth within the previous year from arrest by immigration officers.

Oh yea, and the order is gender neutral too. So pregnant transvestite men, nursing trannies and trannies who have given birth within the previous year are also exempt from arrest when jumping the border. 😔



Quote from the article:
"The gender neutral language used in the memo means the directive also includes transgender men, and it applies to anyone postpartum who has given birth within a year."

Does that count as a sign of impending collapse? If not economic, maybe societal.

What a fucking surreal bizarro world! Where's that asteroid when ya need it? Well, at least there'll no more mean tweets.
 
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I like this news because it correlates with my growing suspicion that we are heading into a contraction. If it contradicted my thinking, I'd discredit or ignore it.

In all seriousness, I do think this is a bad omen for macroeconomic conditions, but I don't know exactly what it means. It seems like this book of business would be rather small in comparison to other forms of consumer credit (housing, auto, and traditional credit cards), and so maybe this is simply a matter of trimming the bank's overall risk profile. But any form of credit contraction should be viewed as deeply suspicious, given the Fed's attempts to inflate credit availability. I'll wait for another shoe to drop before attempting to extrapolate a trajectory.
The smartest markets currently agree with you, and the dumbest people disagree with you, so you might have something.
 
I can’t help but wonder if this is not something preemptive on their part. The current regime has made numerous comments about the current credit rating system being unfair. Also, if you have paid attention to the talk of reparations, it has been centered around providing “economic opportunity“ rather than a monetary payment. The potential exists, between a revised credit rating system and this type of reparations thinking, for banks to be forced into a position where they have no choice but to make loans that are extremely high risk.
 
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The smartest markets currently agree with you, and the dumbest people disagree with you, so you might have something.

This is new territory for me. I'll be back later with some worse takes.
 
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This is new territory for me. I'll be back later with some worse takes.


If you look at what has happened in the bond markets over the last almost two months, you get a pretty good picture of how expectations have changed. Mid may was the height of inflation madness, and since then the 5 and 10 year inflation breakevens have rolled over in a head and shoulders pattern, which is a pretty good indicator of a peak having been made in the inflation expectations market. Both peaked at around 2.5% and are 10% off of their highs. But as I said, more interesting is the market action as to how they got there. I am not much of a believer in technical analysis leading to fundamental insights, but since bond traders use it widely, it is a good map of their thoughts. Further, 10 year yields have come down a lot. 25% or so from their highs.

Second, the rollover in the commodities markets is really interesting. We now "know," or have a pretty good idea, that the decrease in commodities prices is directly related to China wanting to bring down prices and their regulators made some moves to do so. https://www.cnbc.com/2021/06/17/com...-tumble-on-china-crackdown-rising-dollar.html. Ask yourself why they would want to do this, if they were benefitting from the rise. The answer is that they don't believe there is sufficient demand for commodities at those prices, and that things are softening.

Third, the only commodity that is really continuing to do well is oil, though as I have pointed out, it is well below its multi year highs. And oil prices rising is not a sign of mass inflation as much as it is a precursor to a decline in economic activity. That isn't to say it has no inflationary influence, but its influence depends a lot on what the greater economic situation looks like.
 
If you look at what has happened in the bond markets over the last almost two months, you get a pretty good picture of how expectations have changed. Mid may was the height of inflation madness, and since then the 5 and 10 year inflation breakevens have rolled over in a head and shoulders pattern, which is a pretty good indicator of a peak having been made in the inflation expectations market. Both peaked at around 2.5% and are 10% off of their highs. But as I said, more interesting is the market action as to how they got there. I am not much of a believer in technical analysis leading to fundamental insights, but since bond traders use it widely, it is a good map of their thoughts. Further, 10 year yields have come down a lot. 25% or so from their highs.

Second, the rollover in the commodities markets is really interesting. We now "know," or have a pretty good idea, that the decrease in commodities prices is directly related to China wanting to bring down prices and their regulators made some moves to do so. https://www.cnbc.com/2021/06/17/com...-tumble-on-china-crackdown-rising-dollar.html. Ask yourself why they would want to do this, if they were benefitting from the rise. The answer is that they don't believe there is sufficient demand for commodities at those prices, and that things are softening.

Third, the only commodity that is really continuing to do well is oil, though as I have pointed out, it is well below its multi year highs. And oil prices rising is not a sign of mass inflation as much as it is a precursor to a decline in economic activity. That isn't to say it has no inflationary influence, but its influence depends a lot on what the greater economic situation looks like.
Yeah but what about fcoj these guys wanna know
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It’s not the best situation, agreed. It says that WF for some reason has determined that the ROI on LOCs are not acceptable at a gross level to cause a change of course as a corporation. That’s a pretty big move as that is a legit revenue stream they are taking off the table.
Just had a chat with a buddy retired from JPMorgan who said the decision was made by WF b/c of the asset cap restrictions the Fed put on them post 2016 fake account debacle. LOCs not profitable and keeping them from growing....doesn't seem like a bad idea to seek life elsewhere if there isn't enough juice for the squeeze.
 
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Bank of America ended their "Line of Credit" about 3 years ago. That was a nice feature to have. I used it many times when I knew I had a lump sum coming in a few months. Cheap interest to tide me over.

Now, as for :

1st sign of impending collapse??​


I would guess this is about the 300th sign of an impending collapse....
There are several threads going right here on the Hide that are identifying inflation, shortages, etc....
America is heading down the rabbit hole. Your #1 possession is your health. Invest heavily while you have some time.
Stay calm and prepare.
No one is coming to save you.

Hobo
American Express still has one, they call it the 'Plan'. gives you up to 18 months of 0% financing on large purchases. I bought my Springfield Armory Scout on that plan. Its really easy, just tell them what you want and it happens, but thats Amex for ya.

I have a BOA account and card but their crooks so fuck them.

Fuck Wells Farrgo.

Fuck the Chicoms.
 
From my understanding, many of these loans are student loans. With the Dems wanting to forgive these debts, it makes sense for Wells Fargo to get out of that business.

I wouldn't read too much into the reports. After all, who's reporting this?
 
From my understanding, many of these loans are student loans. With the Dems wanting to forgive these debts, it makes sense for Wells Fargo to get out of that business.

I wouldn't read too much into the reports. After all, who's reporting this?
Don't say that you'll disappoint the doomers.
 
Just had a chat with a buddy retired from JPMorgan who said the decision was made by WF b/c of the asset cap restrictions the Fed put on them post 2016 fake account debacle. LOCs not profitable and keeping them from growing....doesn't seem like a bad idea to seek life elsewhere if there isn't enough juice for the squeeze.
not the reason