BANKS COLLAPSE

Last year this time banks were utterly collapsing into the floor boards and western finance as we knew it was over. It was merely a matter of waiting before bearing the fruits of the coming apocalypse were to be digested. Since then the magicians at the Fed and treasury managed to paper over the catastrophe of higher rates and absolutely ruined balance sheets via tricks.

Well, one year later these issues seem to be reoccurring, with shares of $NYCB cut in half over the past two days and a series of regionals crashing.

$WAL -13%
$FFWM -12%
$VLY -11%
$AFL -10%
$BKU -9%
$ZION -9%

Here’s a look at the regional bank ETF, down 11% YTF.

BOTTOM LINE: We are living in fantasy land with stocks obstinately higher as everything burns around us. Whilst I’m not fixated on selling it short into the grave, I am cognizant of the fact that a shoe is going to drop, at some point, and really want to avoid being on the wrong side of the trade.