Is America's economy about to completely collapse? A number of key economic indicators suggest it might.

WASHINGTON, DC- While most of America focuses on wars in Ukraine and the Middle East, where are Taylor Swift and Travis Kelce eating dinner, and when will former President Donald Trump be indicted for unpaid parking tickets, a looming financial crisis is bubbling under the surface. 

If current economic indicators mean anything, Biden’s inflation armageddon may be right around the corner. Record interest rates on credit cards, skyrocketing mortgage rates, and a volatile real estate industry are all conspiring to put a ton of pressure on financial institutions. 

As author Michael Snyder writes, banks have been getting stingy with their money while closing down hundreds of branches and laying off thousands of workers. He believes we are headed for the worst financial crisis since the housing bubble caused the great recession in 2008-09. 

He noted that during the first week of October, U.S. banks closed some 54 local branches…in one week, as reported by the Daily Mail. 

For example, Bank of America closed 21 branches that week, according to a bulletin published by the Office of the Comptroller of the Currency. Meanwhile, Wells Fargo shut down 15 banks, while US Bank and Chase closed nine and three branches, respectively. 

This is nothing new, Snyder writes, noting that US banks have been shuttering branches for some time now. Last year, US banks closed about 2,000 more branches than they opened, Kiplinger Personal Finance reported. 

“Banks are closing branches faster than they’re opening new ones. U.S. banks closed over 3,000 branches last year while opening about 1,000. JP Morgan Chase led in branch closures last year, shuttering 144 branches while opening 133. THe trend will likely continue as banks face staunch competition for deposits and younger customers from online banks, fintech firms, and Big Tech.” 

As Snyder notes, these bank closings aren’t only happening in big cities but across the country, perhaps in your hometown. 

Along with bank closures come layoffs, and in 2023, banks are jettisoning employees at a fast rate, CNBC reports. 

“The largest American banks have been quietly laying off workers all year–and some of the deepest cuts are yet to come. 

“Even as the economy has surprised forecasters with its resilience, lenders have cut headcount or announced plans to do so, with the key exception being JPMorgan Chase, the biggest and most profitable U.S. Bank. 

“Pressured by the impact of higher interest rates on the mortgage business, Wall Street deal-making and funding costs, the next five largest U.S. banks have cut a combined 20,000 positions so far this year, according to company filings.” [emphasis added] 

In a free market economy such as ours, as the banks go, so goes the rest of the economy. And economic conditions have been going downhill for 18 months in a row, according to The Conference Board, a leading reporter of economic trends. 

The Conference Board Leading Economic IndexⓇ  (LEI) for the U.S. declined by 0.7 percent in September 2023 to 104.6 (2016=100), following a decline of 0.5 percent in August. The LEI is down 3.4 percent over the six-month period between March and September 2023, an improvement from its 4.6 percent contraction over the previous six months (September 2022 to March 2023.). 

Justyna Zabinska-La Monica, Senior Manager of Business Cycle Indicators at The Conference Board, said, “The LEI for the US fell again in September, marking a year and a half of consecutive monthly declines since April 2022.” 

She said that while there were fewer initial claims for unemployment insurance, that was offset by “negative or flat contributions from nine of the index’s ten components.” 

“Although the six-month growth rate in the LEI is somewhat less negative, and the recession signal did not sound, it still signals a risk of economic weakness ahead.” 

She noted that while the US economy “has shown considerable resilience despite pressures from rising interest rates and high inflation,” she said it does not appear to be the case going forward, noting that “a shallow recession is likely in the first half of 2024.” 

That is, Snyder writes, somewhat of a best-case scenario. If a more widespread war erupts in the Middle East outside of Gaza, all bets are likely off. Despite Joe Biden bragging that “Bidenomics is working,” the current economy is teetering on the brink of disaster. 

For instance, in the first nine months of 2023, the number of commercial Chapter 11 bankruptcies stands 61 percent higher than the same period one year ago. Zero Hedge wrote that a “wide array of U.S. businesses” have struggled in 2023, citing a report by Epiq Bankruptcy, which cited 4,553 such filings thus far. 

What of the real estate market? That may be even worse. CNBC reported last week that existing home sales dropped to their lowest level since the foreclosure crisis of 2010 brought on by the housing bubble. 

From CNBC:

Sales of previously owned homes dropped 2% in September from August to a seasonally adjusted, annualized rate of 3.96 million units, according to the National Association of Realtors. Sales were 15.4% lower compared with September 2022. 

This is the slowest sales pace since October 2010, during the Great Recession, when the market was in the midst of a foreclosure crisis. As a comparison, just two years ago, when mortgage rates hovered around 3%, home sales were running at a 6.6 million pace. The average rate on the 30-year fixed today is right around 8%, according to Mortgage News Daily. 

Home foreclosures are up 34 percent compared to the same time in 2022, Fox Business reported, citing a report from real estate data provider ATTOM. Default notices, scheduled auctions, and bank repossessions jumped 28% in the third quarter to 124,539. 

How much worse can it get? It appears a lot if things continue to escalate in the Middle East. Those $ 4-a-gallon gas prices may prove to be a distant memory if that happens.