By the time you’re reading this, First Republic Bank’s stock trading is being halted.
The stock is now 98% down from it’s peak.
It’s facing the depositors run & the Fed seems in no hurry to rescue the bank.
From what I read, if First Republic Bank were to fail (Which potentially has already failed), it would be the 5th largest US Bank Failure.
Anyway, what’s in it for stock market investors like you & me sitting in India?
Well… It’s a blessing in disguise.
Looking at the pressure these US banks are facing, the US Fed will raise max to max 0.25 bps or pause the rate hikes.
This makes inflation cool off & RBI too will most likely follow the suit.
Once the rate hikes are moderate (read gone), there would be again liquidity in the market & as always, liquidity pushes assets prices up. (Whether that’s the fundamentally right thing or wrong is a discussion for later blog).
Inflation coming off, asset prices rising is good for every Indian investor.
