Special offer

The Troubled Bank List Grows Larger

By
Services for Real Estate Pros with TheHousingGuru.com

crumbling bankThe number of banks on the FDIC “troubled bank” list has grown by more than one-third in just the past 90 days. According to information released today, the FDIC has increased the number banks at risk of failure to 416, the highest number in 15 years.

 

In a blog post I did less than two weeks ago I pointed out the mounting potential for looses faced by the government’s bank guarantee fund. With combined assets of almost 1/3 of a trillion dollars, the failure of a significant number of these troubled banks could wipe out the reserves of the Deposit Insurance Fund.

 

What these numbers represent is the continuing instability of the U.S. economy; there are just too many negative indicators to think otherwise. In a blog post from last Saturday, I pointed out 7 continuing reasons for concern.

 

Wall Street, the big banks, and politicians might prefer that we ignore the fundamentals, but common sense and prudence dictates otherwise.

 

The Housing Guru: The one source for all your housing questions

 

Jon Budish
Resident Realty - Fort Collins, CO

We continue to see negative economic indicators, but the news media reports that conditions are improving. What am I missing?

Aug 27, 2009 04:02 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Jon - It's easy to find some signs of improvement after we've hit record breaking lows. But what we have to keep in mind is where we are relative to true recovery--we're not there yet.

Aug 27, 2009 04:09 AM
John Rakoci
Eagle Realty - North Myrtle Beach, SC
North Myrtle Beach Coastal Carolinas

Jon- the media is more politically motivated than motivated by honesty. The media was a great influence in putting obama in office and they will say anything to make themselves and him look good.

Aug 27, 2009 04:11 AM
Jane Penttinen
V.I.P. Mortgage - Tucson, AZ
NMLS #222178

Ah!  And the more money we print the more there will be trouble in River City.  Looks like we are on a speeding freight train headed straight for a brick wall.  China is already cutting way back on the amount of our debt they are willing to buy.  It is going to be a very rough ride indeed.

Aug 27, 2009 04:14 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

John - Yes, everyone has an agenda.  But we need to know the facts if we're to make sound business decisions.

Aug 27, 2009 04:16 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Jane - The printing presses are running overtime, and we'll ultimately pay the price. I just saw a statistic that 25% of all banks are currently unprofitable.

Aug 27, 2009 04:18 AM
Thom Abbott
MyMidtownMojo.com |770.713.1505 | Intown Atlanta GA Condo Living - Atlanta, GA
Midtown Atlanta GA Condos For Sale

John....of course the news media and politicians want to take the smallest morsel of news and make it a full cake! I'd be one of the first to tell you, I'd like to hear good news.

I can look at the "board" in our office (where New Listings and Under Contract Properties are noted) and July was awesome. But August has been lack luster again...so hmmmm.

I'm not at all convinced we are out of the woods yet. Not only with bank failures, but with foreclosures. And if they keep coming and coming, it's just going to keep the housing cycle depressed. And with that will be more short sales (not an easy task either) and then still more foreclosures if someone could not sell in a short sale, and just walks away. (I just had that happen to a listing of mine.)

Some days, I just want to hide under my bed!

BTW, great to meet you in person and hope to see you again! I understand if you don't make the trek to Midtown for Social Media Breakfast....I'll have to think twice about Cartersville!

Aug 27, 2009 04:53 AM
Suesan Jenifer Therriault
JTHIS-Professional Home Inspection Team - Blakeslee, PA
"Inspecting every purchase as if it were my own".

You turn on the T.V. and the national networks are talking about an economic rebound, then the local news comes on and such and such business is closing putting 130 out of work. Friday I found out that a good friend lost his job. The news is reporting about something that just isn't truly happening and the public is buying into it.

Aug 27, 2009 05:16 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Tom - I enjoyed getting to meet you yesterday, and it was nice to see that I'm not the only one who doesn't quite get it when it comes to social media : )  Who knows, I might even make it to midtown.  Regarding the economy, all I want is an honest reporting of the facts; I prefer to do my own interpretations.

Aug 27, 2009 05:17 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Sue - Regardless of how the news is "spun," the facts are still pretty grim for lots of folks. 

Aug 27, 2009 05:20 AM
Joe Jackson
Keller Williams Capital Partners Realty - Columbus, OH
Clintonville and Central Ohio Real Estate Expert

Wow what it means perhaps is no bank if too big to fail

Aug 27, 2009 10:25 AM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Joe - Yes, but some in the government would disagree.

Aug 27, 2009 10:32 AM