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European Banks Aren’t Immune to the Turmoil in US Banking

European Banks Aren’t Immune to the Turmoil in US Banking
Flags in front of the European Central Bank (ECB) building, in Frankfurt, Germany, on July 21, 2022. Wolfgang Rattay/Reuters
Daniel Lacalle
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Commentary

Deposits at U.S. commercial banks have fallen to the lowest figure in nearly two years, according to the Federal Reserve. This figure has fallen by $500 billion since the Silicon Valley Bank collapse. However, total banking credit has risen to a new record high of $17 trillion, according to the U.S. central bank. Less deposits, but more credit. What could go wrong?

Daniel Lacalle
Daniel Lacalle
Author
Daniel Lacalle, Ph.D., is chief economist at hedge fund Tressis and author of the bestselling books “Freedom or Equality” (2020), “Escape from the Central Bank Trap” (2017), “The Energy World Is Flat”​ (2015), and “Life in the Financial Markets.”
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