Is the global banking industry in trouble? Economist David Rosenberg breaks it down and tells Power & Politics that an 'elevated level of uncertainty is going to reinforce the trend towards a recession.' »»» Subscribe to CBC News to watch more videos: Connect with CBC News Online: For breaking news, video, audio and in-depth coverage: Find CBC News on Facebook: Follow CBC News on Twitter: For breaking news on Twitter: Follow CBC News on Instagram: Subscribe to CBC News on Snapchat: Download the CBC News app for iOS: Download the CBC News app for Android: »»»»»»»»»»»»»»»»»» For more than 80 years, CBC News has been the source Canadians turn to, to keep them informed about their communities, their country and their world. Through regional and national programming on multiple platforms, including CBC Television, CBC News Network, CBC Radio, CBCNews.ca, mobile and on-demand, CBC News and its internationally recognized team of award-winning journalists deliver the breaking stories, the issues, the analyses and the personalities that matter to Canadians....(read more)
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In recent months, there has been growing concern about the state of the global economy and the possibility of a looming recession. Many have turned their attention to the banking industry, in particular, as a potential trigger for such an event. However, according to a recent article in The Economist, these fears may be overblown. The article argues that while there are certainly reasons for caution, the banking system is far more robust than many seem to believe. For one thing, the overall level of non-performing loans (NPLs) is relatively low. Despite some concerns about rising levels in certain countries, such as China and Italy, the proportion of bad loans has been falling in many parts of the world. This suggests that banks have been successful in managing credit risk, which is a key driver of banking crises. Moreover, the article notes that regulations have strengthened considerably since the last major crisis in 2008. There are now stricter rules governing capital reserves and liquidity, which should help to prevent banks from becoming over-leveraged or losing access to funding in times of stress. In addition, the regulatory authorities have become more proactive in monitoring banks and intervening when necessary to mitigate risks. So, if the banking system is relatively sound, why are so many worried about a recession? The article suggests that the concern may be driven by broader economic trends, such as the trade war between the US and China, political uncertainty, and high levels of public and private debt. These factors could all contribute to lower growth, which in turn could lead to decreased profitability for banks – even if they are not directly in danger of collapsing. Nonetheless, the article concludes on a note of cautious optimism. While there may be some rough times ahead, the banking sector is likely to weather the storm reasonably well. Of course, there are always risks, and no one can predict with certainty what the future holds. But for now, it seems that the fears of a banking crisis may be misplaced. Overall, The Economist's analysis suggests that despite concerns about a possible recession, the banking industry is in a reasonably healthy state. While there are certainly risks, including rising levels of NPLs in certain countries and broader economic trends, the regulatory environment and the overall health of the system suggest that a major crisis is unlikely. This should provide some degree of reassurance to investors and consumers alike. https://inflationprotection.org/an-economist-explains-banking-worries-and-the-possibility-of-a-recession-trend/?feed_id=92366&_unique_id=644c14c49edfa #Inflation #Retirement #GoldIRA #Wealth #Investing #bankingindustry #canada #CBC #CBCNews #economist #inflation #interestrates #powerandpolitics #recession #UnitedStates #RecessionNews #bankingindustry #canada #CBC #CBCNews #economist #inflation #interestrates #powerandpolitics #recession #UnitedStates
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