- Larry Fink predicts 2-3 more rate hikes
- Large banks poised for global success, regional banks face challenges
- Earnings reports could unveil potential risks
Ready for some fun financial talk? In a laid-back chat with "The Claman Countdown" on Friday, BlackRock CEO Larry Fink shared his hunch about the Fed's interest rate moves. He's betting on two or three more hikes since he thinks short-term interest rates need to rise in response to sticky inflation. Even though it's dropping, Fink doubts we'll see inflation below 4% anytime soon.
Last month, the Consumer Price Index inched up 0.1% and soared 5% YoY, but that's old news. Fink dropped some fresh knowledge during his convo with FOX Business’ Liz Claman and Charlie Gasparino, offering insights into the recent banking crisis.
America's big-league banking system is stronger than ever, according to Fink, and it's prepped for a fantastic global streak. But what about the smaller regional banks? That's where things get tricky. Loss of confidence is one problem, which led to billions of bucks pouring out of these banks and into larger banks, money market funds, bonds, and ETFs in just a few weeks.
Fink also shed light on potential issues among mid-sized, community, or regional banks. They're grappling with higher deposit rates and losses in their bond portfolios. He mentioned the Federal Deposit Insurance Corporation's recent takeover of Silicon Valley Bank and Signature Bank, which led to market turbulence, especially for some banking stocks.
In the next few weeks, the quarterly earnings reports of small and regional banks could be the breaking point for more banks, Fink speculates. While liquidity from the Federal Reserve or the Federal Home Loan Bank Board is keeping them afloat, they're paying current market rates, which might be the real challenge.
Stay tuned for more banking drama, as Fink's financial foresight unfolds!
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