Feds will Slash Interest Rates by 100 Basis Points by December After Silicon Valley Bank

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Larry McDonald, founder of “The Bear Traps Report” on Friday appeared on CNBC’s Squawk Box after Silicon Valley Bank was shut down by regulators in the biggest bank failure since the 2008 liquidity crisis.

Larry McDonald said the Federal Reserve is causing the bank run and predicted the fed will slash rates by 100 basis points – or 1% – by December.

The Federal Reserve raised interest seven times in 2022 in an effort to get inflation under control.

2022’s rate hikes totaling 450 basis points is causing problems for bankers because investors want to move their money into higher yield bonds.

“The Federal Reserve is causing this bank run,” McDonald said. “They need to get inflation down so they’re playing with Frankenstein. This is a contagion process. They’re now probably going to cut rates by 100 basis points by December.”

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