We are still reeling over the news from the FDIC that total U.S. bank lending contracted by a record 3% in Q3 and that we are now up to 552 banks with combined assets of nearly $350 billion that are deemed to be “in trouble”. This just reinforces our view that much more that the equity market as divorced from economic reality to a degree that we have rarely seen in the past three decades. Fifty banks failed in the third quarter – the most in 17 years! The FDIC’s fund balance is now negative.
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