“Let the churches of the world [and the religions] stop trying to outstrip each other in the number of their adherents, the size of their sanctuary, the abundance of wealth. If we must compete, let us compete to see which can move toward the greatest attainment of truth, the greatest service of the poor, and the greatest salvation of the soul and bodies of men. If the Church entered this type of competition we can imagine what a better world this would be.” — Dr. Martin Luther King Jr.
World War III Watch — Week Of April 24, 2023
First Republic Bank Is Seized, Sold to JPMorgan in Second-Largest U.S. Bank Failure In History and the Third U.S. Bank To Go Bankrupt In the Last Three Months
By Rachel Louise Ensign and Ben Eisen Updated May 1, 2023, 4:35 am EDT for Wall Street Journal — https://apple.news/ATrZqns0MTaenbR5eQBFtJw
As I’ve stated in previous posts, although financial and economic news doesn’t immediately inspire images of a “world war” to the mind and senses as much as overtly war-like conflict events, these events may pose more of a threat to global peace than military skirmishes in Ukraine or Taiwan or Syria et al. The working theory being that countries accustomed to decades of peace and prosperity, as we’ve had on planet earth for decades now, may and usually will do everything they can to de-escalate military conflicts to avoid large multinational wars, even when attacked in some way — consider the American journalist just captured and imprisoned by Russia in the last few weeks…, or consider the absolute clusterfu+*k of America’s embarrassing escape out of Afghanistan after 20+ years of fighting and then handing it right back over to The Taliban… all those lives lost…. But no world war…. but when economic desperation sets in in a country, watch out — all cards are off the table and a nation’s typical reaction is to lean hard right nationalistic, start chest thumping about “national pride” and “protecting the homeland from foreign threats” and before we know it, someone somewhere does something to what they perceive as a weaker someone and off to war we go. Despite what they say it’s always economically and financially motivated. They need. And when someone needs, all bets of diplomacy or compromise are off. The United States sadly, as many nations around the world, is facing some scary impending economic consequences. We’re just not talking about it yet. (Insert the potential commercial real estate debt crash that is being discussed under the radar at the moment; if you’re aware of it…..). That’s why this sudden trend of large regional banks going bellyup is important.
Concerns Grow as Tighter Lending Threatens $20 Trillion Commercial Real Estate Market
By Ephrat Livni for the New York Times April 6, 2023
The recent banking turmoil added scrutiny to a sector already weighed down by office vacancies, rising interest rates and mounting debt. The turmoil that drove Silicon Valley Bankand Signature Bank out of business last month, rocking the wider banking sector, has analysts bracing for the next possible crisis: the $20 trillion commercial real estate market. Read whole article here
Russian pilots tried to ‘dogfight’ US jets over Syria, US Central Command says
By Oren Liebermann, CNN — https://www.cnn.com/2023/04/29/europe/russia-fighter-pilots-dogfight-us-jets-syria-intl-hnk
US risky business in China
Doing business in China has never been straightforward. But now it’s becoming dangerous for (some) American companies.
On Wednesday, Chinese cops raided the Shanghai offices of US consulting firm Bain, questioning local employees and taking away computers and phones. No explanation was given by the police or the Boston-based firm, but the search was carried out the same day that China expanded its espionage law, giving authorities greater powers to inspect premises and digital devices of local businesses. (This comes a month after China arrested five Americans working at the due-diligence firm Mintz and shut down its Beijing HQ.)
These episodes highlight the increasingly risky environment for US businesses operating in China. As US-China relations get frostier, a whopping 87% of US execs surveyed by the AmCham industry group say they’re pessimistic about the future. [From GZERO MEDIA]
Paraguay holds presidential election with geopolitical ripples
Paraguayans go to the polls Sunday to pick their next president. Domestically, the big story is whether centrist opposition leader Efraín Alegre can beat Santiago Peña from the right-wing Colorado Party, which has almost monopolized power since the country ditched military rule in 1989. But there are also two geopolitical angles to keep an eye on.
First, the election is being closely watched in Taipei and Beijing. If he wins, Alegre has suggested he might switch diplomatic relations from Taiwan to China — meaning that the self-ruled island would lose its last friend in South America. The presidential candidate believes that Taiwan has not invested enough in Paraguay to offset the immense cost of not doing business with China, so he’s made it clear to Tsai Ing-wen: Show us the money or we’ll call Xi Jinping. [From GZERO MEDIA]
First Republic Bank Teeters on the Brink of Collapse — [By Mack Wilowski for Investopedia Published April 26, 2023]. [Transcendence Diaries editorial intro by Ed Hale… Yet another large regional bank in the United States hangs by a nail on its way to bankruptcy. In what might be the third, fourth or fifth (it’s hard to keep track now) major regional bank in the U.S. to head belly-up in the last two months, money’s disappearing faster than The Fed can print or loan it, but it’s still not major news to the majority of Americans. Why? Maybe it’s because there’s no celebrity gossip attached to it. Maybe it’s because it’s not trending on TikTok. Maybe it’s because Americans don’t think anything is important unless the government interiors their regularly scheduled programming — except that no longer exists — to advise them that something really IS important. And the American government isn’t going to do that here. Not now. They’ll let every small, city, county, state and regional bank in America go bankrupt before they’ll ever say a word to the unsuspecting public. By then it’ll be too late. The rich will have gotten all their money out and both The Federal Reserve and The US Treasury will announce that there’s no more money left for the working class. That’s how it always goes. In return, Americans get to claim they enjoy all the benefits and fruits of Capitalism. Strange game. Horrible odds. Why is it important in regards to an impending World War III? The answer seems obvious. When a large regional bank of a country suddenly goes bankrupt, it should be concerning and front page news. Something isn’t right. When 4-5 of them do in a matter of 8-10 weeks, Mission Control we have a serious problem. The last thing in the world you want when confronting an enemy that’s insane and has nothing to lose (Russia), another who literally thinks youre “evil” and calls you The Great Satan (Iran) and another who hold the very financial and economic stability in the palm of its hand (China) is to be going broke faster than you can keep track of. And sure maybe this is just business as usual capitalist housekeeping… But what if it’s not?]
First Republic Bank (FRC) is teetering on the brink of collapse as shares fell to new all-time lows on reports the federal government and the nation’s biggest banks are reluctant to put together a rescue package.
The beleaguered lender reported deposit outflows of more than $100 billion in the first quarter, or 40% of the total.1 That figure would have exceeded 50% if not for a $30 billion injection of uninsured deposits from 11 of the nation’s biggest banks in March.2
In response, shares of FRC plunged almost 50% yesterday, and are down another 30% today. The bank’s market cap fell below $1 billion in intraday trading, a small fraction of its $40 billion peak in November 2021. Its price-to-earnings (P/E) ratio fell as low as 0.7. The stock’s volatility prompted the New York Stock Exchange (NYSE) to halt trading of FRC 12 times Wednesday.3
To make matters worse, First Republic faces the prospect of losing access to the Fed’s lending facilities if a private deal isn’t reached soon, Bloomberg reported.4 U.S. regulators prefer a private rescue that wouldn’t involve federal authorities seizing the bank, which could further deplete the FDIC’s insurance fund.
Management is scrambling to convince regulators and executives of bigger banks to provide one more financial lifeline. Executives are engaged in a last-ditch effort to improve the bank’s financial standing.
Its options include transferring troubled assets into a “bad bank” or selling off assets at above-market rates. However, other banks may be reluctant to intervene for fear of losing their uninsured deposits and would prefer the FDIC assume control of part of First Republic’s assets.5
First Republic Bank ran into financial difficulty shortly after the collapse of Silicon Valley Bank (SVB) and Signature Bank in March, as it had the third-highest share (behind the two collapsed lenders) of uninsured deposits that exceeded the FDIC’s $250,000 limit.
FRC shares tumbled 60% in the first trading session after SVB and Signature Bank’s collapse. They’ve since extended their decline, and are down more than 95% year-to-date.
EARNINGS REPORTS AND NEWSFirst Republic to Cut Staff After 40% Plunge in Deposits
BREAKING: U.S. sanctions Russian and Iranian security services for “holding Americans hostage” https://www.axios.com/2023/04/27/russian-iran-sanctions-wrongful-detention
The U.S. is imposing sanctions on the Russian Federal Security Service (FSB) and the intelligence arm of the Iranian Islamic Revolutionary Guard Corps (IRGC), plus four IRGC leaders, for their roles in the wrongful detentions of U.S. citizens, senior U.S. officials told reporters on Thursday.
Why it matters: The officials said this was the first of multiple rounds of sanctions in the works to punish and deter those who would hold Americans hostage. The practical implications of this step are unclear as both organizations are already under U.S. sanctions.
- These were the first sanctions announced under an executive orderPresident Biden signed last year to provide new tools to help bring hostages home.
What they’re saying: “We do think it’s significant that the first round of sanctions are being announced specifically for this type of behavior, because we’re really concerned about this type of behavior,” a senior official said.
- The sanctions package was already in the works before Wall Street Journal reporter Evan Gershkovich was detained on espionage charges, which the U.S. and WSJ both say are baseless, a senior official said.
Bloomberg News :: BREAKING :: April 27, 2023 5:56 am Germany in Talks to Limit the Export of Chip Chemicals to China — The move could affect German companies including Merck, BASF. Chancellor Scholz has been striking a harder line on China. Germany is in talks to limit the export of chemicals to China that are used to manufacture semiconductors as Berlin steps up efforts to reduce its economic exposure to the Asian nation. https://www.bloomberg.com/news/articles/2023-04-27/germany-in-talks-to-limit-the-export-of-chip-chemicals-to-china
April 27, 2023 4:10 am With Zelensky call, Xi Jinping steps up bid to broker peace – but does he have a plan? https://www.cnn.com/2023/04/27/china/china-ukraine-xi-jinping-zelensky-call-analysis-intl-hnk
Hong Kong (CNN) — A long-awaited phone call between Chinese leader Xi Jinping and Ukrainian President Volodymyr Zelensky on Wednesday has received a tentative welcome in Washington and parts of Europe for its potential to increase dialogue toward resolving Russia’s brutal war in Ukraine. It also marks the most concrete step made to date by China to take up the role of mediator that it has for months alluded to playing. But the hour-long conversation, believed to be the first between the two leaders in the fourteen months since Russia invaded Ukraine, also comes with few tangible proposals for how China might help to bridge the devastating, war-torn divide between the two countries. And its timing – at a moment when Beijing is acutely focused on strengthening ties with Europe amid cratering relations with the United States – also suggests there are more drivers than just peace in China’s calculus, analysts say. Ties have been frayed thin since the outbreak of the war, as European leaders have watched in dismay while Beijing refused to condemn the invasion and instead bolstered its economic and diplomatic ties with Moscow, including joining the Kremlin in blaming NATO for fueling the conflict. Efforts from Beijing to repair those relations took a major stumble earlier this week after China’s top diplomat in Paris suggested in a televised interview that former Soviet states have no status under international law – seen as a potential nod to Putin’s view that Ukraine should be part of Russia.
One of China’s most popular and downloaded apps on the App Store, Pinduoduo, listed on the NASDAQ Exchange, has the ability to spy on its users, say experts —- https://apple.news/AJGW-QsJEQb-M9-WGDwccog