A ticking time bomb.
In another stark example of the economic mismanagement under the Biden regime, a new report from the Federal Deposit Insurance Corporation (FDIC) reveals a staggering $517 billion in unrealized losses within the US banking system, The Daily Hodl first reported.
This alarming figure, largely due to exposure to the residential real estate market, is a clear indication of the damaging effects of Biden’s failed policies.
The FDIC’s Quarterly Banking Profile report paints a grim picture of the current state of our nation’s financial institutions. Banks are now burdened with more than half a trillion dollars in paper losses on their balance sheets.
Although banks can hold securities until they mature without marking them to market on their balance sheets, these unrealized losses can become an extreme liability when banks need liquidity, per the Daily Hodl.
According to Investopedia, an unrealized loss is a “paper” loss that results from holding an asset that has decreased in price, but not yet selling it and realizing the loss. These losses become “realized” only when the asset is sold at a price lower than its original purchase price.
Hellbound and Down 