WeWork’s Bankruptcy Could Trigger a Greater Banking Crisis

[Intelligent Income Daily]( Welcome to Intelligent Income Daily, the free daily newsletter from wealth and income expert Brad Thomas. Brad’s experience spans three decades of real estate and stock market booms and busts. Today, he and his team focus exclusively on the safest and most predictable ways to earn sustainable and growing income in any market condition. You can find all past issues [here](. And if you have any questions, please contact Brad and his team [here](mailto:memberservices@widemoatresearch.com). WeWork’s Bankruptcy Could Trigger a Greater Banking Crisis By Brad Thomas, Editor, Intelligent Income Daily WeWork (WE) has finally put shareholders out of their misery. The company filed for bankruptcy last week. Just four years ago, it was valued at $47 billion. Now it’s worth zero. And [several months ago]( I warned readers to stay far away from this sinking ship. Even the turnaround expert hired to get the company back on track abandoned it as a lost cause. [image]( If you managed to avoid this dumpster fire, give yourself a pat on the back. But don’t relax just yet. WeWork’s downfall will send a shock through our financial system that could trigger the collapse of more banks. Today I’ll explain why and share a special briefing to walk you through how to protect your wealth. Recommended Link [Expert who predicted the bottom in 2020 and tops in 2022 and 2023 warns: “Big Change Coming November 22”]( [image]( Mason Sexton has called nearly every major market move of the last forty years, including: - The crash of 1987 — eleven days before it happened - The exact low of the financial crisis - The bottom in 2020 - The top in 2022 - The top in 2023 - And more… But now the stakes are even higher. An important market event set to occur on November the 22 — the day before Thanksgiving — has made Mason go public with just his second major public prediction in 30 years. He’s sharing all the details tomorrow, November 14, at 8 p.m. ET. [Follow this link to register for free.]( -- The Consequences of WeWork’s Downfall Do you remember the banking crisis earlier this year? Three banks – Silvergate, Silicon Valley, and Signature – all collapsed in a matter of just five days. First Republic fell apart as well just a month later. The rapid rise in interest rates over the past year reduced the value of the bonds they held. And when skittish depositors tried to pull their money out, there wasn’t enough money to pay them all back. After the Federal Deposit Insurance Corporation (FDIC) stepped in to guarantee deposits, customers calmed down. The media attention faded away. But the banking crisis is still unfolding to this day. In July, Heartland Tri-State Bank was shut down to protect depositors. And last week, the FDIC took over Citizens Bank due to financial instability. The collapse of WeWork is going to put even more stress on the small and mid-sized banks that are on the brink of going under. Here’s why… WeWork was a major tenant leasing commercial office space, including nearly 4.2 million square feet in Manhattan. It also had large amounts of office space in San Francisco and Los Angeles. But now that it declared bankruptcy, WeWork will be able to cancel or renegotiate leases. The company has already filed to cancel nearly 70 leases. That puts pressure on the owners of those office buildings. If they are forced to accept lower rents or can’t find tenants to replace WeWork, then they may start to fall behind on mortgage payments. More than $2.4 billion in commercial mortgage loans are backed by properties where WeWork is one of the top five tenants. And if building owners can’t pay the mortgage, they’ll default on the loan and hand the keys to their lenders – the banks. Impact on Banks Now banks are in the business of lending money, not running office buildings. So after they foreclose on those properties, they’ll do whatever it takes to get rid of them – likely selling them off for cheap. That creates more problems. Other banks that still have office loans will have to mark down the value of the properties backing their loans. That makes the “loan-to-value” go up, which means that the loans are riskier. And since there are strict rules about how much risk banks can take, they’ll have to increase their reserves. Those that can’t stay in compliance are at risk of being shut down. It’s a particularly big problem for small and mid-sized banks. Analysts at Citibank say that smaller banks hold 70% of all commercial real estate (CRE) loans. Data from Fitch Ratings show that these loans make up nearly a third of assets for some banks. That’s nearly 6x more exposure compared to the big banks. [Image] That’s why WeWork’s bankruptcy could be the trigger that sets off a chain reaction that blows up more banks. This is why I sat down with analyst Stephen Hester to discuss how investors can protect their portfolios from the continuing banking crisis. Stephen showed me which banks are at the greatest risk of going under due to their commercial real estate loans. And there’s a way to protect your portfolio and set yourself up to profit from these banks’ poor decisions. [Watch my special briefing with Stephen Hester so you can learn how to prepare](. There is no need for you to pay the consequences of WeWork’s mismanagement and these banks’ risky investment deals. Happy SWAN (sleep well at night) investing, Brad Thomas Editor, Intelligent Income Daily IN CASE YOU MISSED IT… [He Declined to Go on CNBC – Now He’s Finally Revealing His “Millionaire Secret”]( During the 2008 financial crisis, millionaire trader Jeff Clark stunned the world when he managed to double his readers’ money 26 TIMES… CNBC caught wind of this and asked Jeff to come on live TV to explain his secret. Jeff politely said no. And now, years later, Jeff is back to finally bring this secret into the light. …Revealing how anyone can collect huge gains in just 8 days… in bullish AND bearish markets! And why you need to IGNORE 99.9% of the market, instead focusing on only ONE stock. [(ticker revealed here)]( Jeff says: “I am tired of watching as investors lose their shirts buying risky assets… even my OWN SON lost -60% in crypto & tech stocks… now I’m going to give him a [“Financial Intervention”]( to help him win his account back in 2023!” [Click Here to Watch Jeff Demonstrate This ONE Stock Secret.]( [image]( [Wide Moat Research]( Wide Moat Research 55 NE 5th Avenue, Delray Beach, FL 33483 [www.widemoatresearch.com]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. 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