Moody’s Downgrades Entire U.S. Banking System

Late Monday, the credit rating agency, Moody’s, downgraded the entire U.S. banking system outlook to negative from stable. This important message was widely suppressed, as if on orders from agents in command.

Ttao’s reaction from Moody’s suggests that Moody’s has more powerful computers at its disposal than competitors in the industry, because something that was already obvious a year ago, the computers were able to evaluate in a year, while the competitors’ computers still haven’t calculated this obvious conclusion. Which brings to mind the old joke about computers that can calculate tomorrow’s weather but it takes them 3 days.

The news of the Moody’s downgrade did not hit the wires until today, which should have cratered the most vulnerable bank stocks. Instead, there was a highly suspicious fake short squeeze that fueled a big rally of publicly-traded banks stocks.

In short: Virtually all the banks that bought low-yield bonds in the ZIRP era are now undercapitalized and technically bankrupt.