US Bundesbank: Financial system Vulnerable with rising risks

15:50  24 november  2022
15:50  24 november  2022 Source:   pressfrom.com

Municipal water among most vulnerable in Colorado River crisis

  Municipal water among most vulnerable in Colorado River crisis Although municipalities make up a small percentage of Wyoming water users under the Colorado River Compact, their legal claims to the water are among the most vulnerable. First in time, first in right If the Upper Colorado River Basin Commission issues a curtailment for Wyoming, it would not necessarily force all water users subject to the compact to close their spigots completely. There’s no curtailment priority in terms of use — whether it’s irrigation for cattle and alfalfa fields, water consumed for cooling at the Jim Bridger coal-fired power plant or water piped to homes for domestic use.

The Bundesbank warns financial institutions in the face of growing risks for financial stability to more precaution. "The banks should be able to absorb losses on their own," said Bundesbank Vice President Claudia Buch on Thursday when the 2022 financial stability report was presented in Frankfurt. Otherwise there could be a credit clamp that exacerbates a real economy crisis.

Eines von mehreren leer stehenden Ladenlokalen auf der Königsallee (KÖ) in Düsseldorf. © Rolf Vennenbernd/dpa of a shop on Königsallee (Kö) in Düsseldorf.

Overall, the Bundesbank sees a significantly worsened environment: for 2023, economists predict a recession. The extremely high inflation of consumers and companies has been troubled by consumers and companies for months. The probability increases that debtors cannot repay loans. "The real economy risks have increased significantly," summarized Buch. The financial system remains vulnerable to these risks. "That means we really have to worry that the vulnerability we have already seen will not become any injuries that are then very difficult to heal later," said Buch.

Trump Org.'s longtime CFO testifies at company's fraud trial

  Trump Org.'s longtime CFO testifies at company's fraud trial NEW YORK (AP) — Donald Trump’s longtime finance chief took the witness stand Tuesday at the Trump Organization’s criminal tax fraud trial, making his long-awaited turn as the star prosecution witness after pleading guilty to evading taxes on $1.7 million in company-paid perks, including a Manhattan apartment and luxury cars. Allen Weisselberg, a senior adviser and former chief financial officer at Trump’s company, has intimate knowledge of the company’s financial dealings from his nearly five decades working there. But he is not expected to implicate Trump or any members of the Trump family in his testimony.

The time series, with the help of which money houses estimated future credit risks, could turn out to be too optimistic, warned the Bundesbank Vice President: «So if we see that the risk provision has dropped very much, this should not yet give the all-clear for future risks . "

Risk prevention

The Bundesbank board member Joachim Wuermeling, responsible for banking supervision, confirmed: «Credit risks and credit cases will be a constant companion of 2023. And that is the reason why we give appropriate warnings. » Wuermeling warned that money houses should use scope for further provision: "What is surprising to us is that so few additional risk provision is formed."

The recently increased interest rates are positive for the industry after years of negative interest rates. In the short term, however, there are also risks because higher interest rates also burden borrowers. Higher interest rates had also pressed courses for securities, banks had to depreciate and had already largely used up their hidden reserves, explained Buch.

When paying dividends, the Bundesbank calls financial institutions to reluctance. Wuermeling emphasized: "In view of a high level of uncertainty, you should carry out careful risk provision and only carefully distribute profits." It is important to keep as much capital as possible in the system for possible losses, said Wuermeling.

Judge OKs federal intervention in struggling water system .
JACKSON, Miss. (AP) — The U.S. Justice Department has won a federal judge's approval to carry out a rare intervention to improve the precarious water system in Mississippi’s capital city, Attorney General Merrick Garland announced Wednesday, months after the system's partial failure. The department filed the proposal for intervention on Tuesday and U.S. District Judge Henry Wingate approved it later that day in Mississippi. The move authorized the appointment of a third-party manager to oversee reforms to Jackson’s water system, which nearly collapsed in late summer and continues to struggle.

usr: 2
This is interesting!