collapsed in March. Following the seizure of First Republic Bank, shares of several banks, including Pacwest and Western Alliance Bank, plummeted.
“It is hard not to see the irony of regional U.S. banks having successfully lobbied for less regulations during the Trump administration only to find that less regulations now is making them vulnerable to bank runs,” Magnusson opined.The U.S. regional bank crisis is spreading. With every bank that succumbs to shrinking deposits and/or market distrust, the probability of more banks falling victim to similar fates grows. A vicious spiral may be about to take hold.
“A general risk-off reaction is becoming increasingly likely, and you should position for this risk,” the strategist concluded. Despite multiple bank failures, Federal Reserve Chairman Jerome Powell stated that the U.S. banking system is “