From iBanknet, the table below shows the Audited Smoothed Net Income in annual 2022 and also the huge Estimated Economic Losses from the annual 2022 decline in the Fair Market Values of both their Available-For-Sale and their Held-to-Maturity Debt Investment Securities of each of the 10 largest in Total Assets US Credit Unions.
From their SEC filings, the table below shows the Audited Smoothed Net Income in annual 2022 and also their huge Economic Losses from the annual 2022 decline in the Fair Market Values of both their Available-For-Sale and their Held-to-Maturity Debt Investment Securities of each of what are considered to be the Big Four US Banks ..... JPMorgan Chase, Bank of America, Wells Fargo and Citigroup.
The 96 publicly-held US Banks with Stock Market Caps above $1 Bil and that disclosed its Financial Statements in both annual 2022 and in annual 2008 in its SEC filings reported Total Economic Losses of $11.947 Bil in annual 2008, the worst year for earnings for US Banks during the horrific 2008-2009 US Financial Meltdown.
So what happened in annual 2022?
Well, unfortunately these 96 US Banks posted Total Economic Losses of $40.458 Bil, predominately due to the US Fed's spastic interest rate actions which caused US Banks' Heavy Investments in Debt Securities to decline precipitously in value by $120 Bil just for their Available-For-Sale Debt Investment Securities in annual 2022.
In addition, 29 of these 96 Banks had material Unrecorded, Off-the-Books, Unrealized But Real Pretax Total Economic Losses of an additional $30.6 Bil at December 31, 2022 related to their Held-to-Maturity Debt Investment Securities.
From SEC filings, the table below shows this financial information for each of these 96 publicly-held US Banks.
The 34 smaller US Banks with Stock Market Caps between $1 Bil and $2 Bil and that disclosed its Financial Statements in both annual 2022 and in annual 2008 in its SEC filings reported Total Economic Losses of $235 Mil in annual 2008, the worst year for earnings for US Banks during the horrific 2008-2009 US Financial Meltdown.
So what happened in annual 2022?
Well, unfortunately these 34 smaller US Banks posted Total Economic Losses of $1.778 Bil, predominately due to the US Fed's spastic interest rate actions which caused US Banks' Heavy Investments in Debt Securities to decline precipitously in value in annual 2022.
In addition, 7 of these 34 Banks had material Unrecorded, Off-the-Books, Unrealized But Real Pretax Total Economic Losses of an additional $1.758 Bil at December 31, 2022 related to their Held-to-Maturity Debt Investment Securities.
From SEC filings, the table below shows this financial information for each of these 34 smaller US Banks.
The 37 US and Puerto Rico Banks with Stock Market Caps between $2 and $5 Bil and that disclosed Financial Statements in both 2022 and in 2008 reported Total Economic Income of $303 Mil in annual 2008, by far the worst year for earnings for US Banks during the 2008-2009 horrific US Financial Meltdown.
So what happened in annual 2022?
Well, unfortunately these 37 US and Puerto Rico Banks posted Total Economic Losses of $3.026 Bil, predominately due to the US Fed's spastic interest rate actions which caused US Banks' Heavy Investments in Debt Securities to decline precipitously in value in annual 2022.
In addition, 14 of these 37 Banks had material Unrecorded, Off-the-Books, Unrealized But Real Pretax Total Economic Losses of an additional $6.687 Bil at December 31, 2022 related to their Held-to-Maturity Debt Investment Securities.
From SEC filings, the table below shows this financial information for each of these 37 smaller US and Puerto Rico Banks.
The 12 US Mid-Sized Banks with Stock Market Caps between $5 and $10 Bil had Total Economic Income of $290 Mil in annual 2008, by far the worst year for earnings for US Banks during the 2008-2009 horrific US Financial Meltdown.
So what happened in annual 2022?
Well, unfortunately these 12 US Banks posted Total Economic Losses of $8.824 Bil, predominately due to the US Fed's spastic interest rate actions which caused US Banks' Heavy Investments in Debt Securities to decline precipitously in value in annual 2022.
From SEC filings, the table below shows this financial information for each of these 12 mid-sized US Banks.
Excluding the Big Four US Banks (JPMorgan Chase, Bank of America, Wells Fargo and Citigroup), the other 13 US Banks with Stock Market Caps above $10 Bil and that reported both annual 2022 and annual 2008 financial statements with the SEC incredibly saw their Total Economic Losses more than double, going from annual 2008's $12.305 Bil, the worst year for US Financial Companies during the horrific 2008-2009 US Financial Meltdown, to the US Fed-driven annual 2022's $26.830 Bil Total Economic Losses.
In addition, 6 of these 13 US Banks had material Unrecorded, Off-the-Books, Unrealized But Real Pretax Total Economic Losses of an additional $20.5 Bil at December 31, 2022 related to their Held-to-Maturity Debt Investment Securities.
From SEC filings, the table below shows this financial information for each of these 13 large US Banks.
Next I will address a comparison of the Bottom-Line After-Tax Net Economic Income or Losses in annual 2022 to that in annual 2008 for the publicly-held US Regional Banks.
PepsiCo just announced its Third Quarter 2023 Worldwide Pretax Income, which increased by 22% from the third quarter 2022.
US Government Bonds have now declined in value by nearly 25% since the summer of 2020 ..... their steepest decline in US history.
From an N-CSR filing TIAA-CREF-FUNDS with the US Security & Exchange Commission, the below table shows the key operating results measure ..... The Net Decrease in Net Assets From Operations ..... for the most recent fiscal year ended October 2022 for each of the 14 Teachers Insurance and Annuity Association of America Funds (TIAA-CREF Funds).
Many years ago, the US Financial Accounting Standards Board (FASB) properly decided that many financial assets should be valued on the balance sheet at fair value.
This infuriated many financial institutions including Banks but also many non-financial institutions because they would all no longer be able to manage their quarterly reported earnings and instead report their quarterly earnings which are more aligned with real economic earnings.
Unfortunately, the FASB knuckled under to this intense pressure by lobbyists for the financial institutions and a compromise was made that resulted in Investment Securities being divided into three categories.
First, Trading Investment Securities would be valued at fair value and any changes in their Unrealized Holding Gains and Losses would be recognized in the quarter when the Change in the Unrealized Holding Gains and Losses occurred.
Second, Investment Debt Securities Planned to be Held to Maturity would not be valued at fair value but instead go on the balance sheet at Cost or at Amortized Cost. Thus, there wouldn't be any quarterly Unrealized Holding Gains and Losses recorded.
And third, all other Investment Securities where fair values are available would be categorized as Available-For-Sale (AFS) Investment Securities and valued on the Balance Sheet at fair value. But the compromised very questionable and very strange twist was that any quarterly Change in the Unrealized Holding Real Economic Gains and Losses would not be reflected in the regular income statement but instead would be reflected in Other Comprehensive Income which unfortunately almost all financial analysts and even Company Board of Directors ignore.
The FASB was wrong when it just assumed financial investors would give the elements of Other Comprehensive Income their due real economic income respect.
Case in point ..... the fairly large SVB Financial Group that just recently filed for bankruptcy.
From its Investment Securities Footnote related to its December 2022 10-K filed with the US SEC, SVB Financial Group had Unrealized Holding Losses of $2.533 Bil related mostly to its US Treasury Securities and its Residential Mortgage-Backed Securities investment holdings.
To show how significant that $2.533 Bil Unrealized Holding Loss is to SVB Financial Group, its Regular Pretax Income in annual 2022 was a lower $2.172 Bil.
Also, at Dec 31, 2021, these Unrealized Holding Losses were only $313 Mil.
Clearly, US Fed Chair Jerome Powell's decision to substantially increase US Short-Term Interest Rates so rapidly and by so much was the predominant catalyst for US Banks substantial increase in their real Unrealized Economic Holding Losses of their AFS Investment Securities, which triggered the current US Banking Crisis.
SVB Financial Group's Loss Risks on its Available For Sale Investment Securities at Dec 31, 2022 were properly under US GAAP reported in Other Comprehensive Income and also disclosed in its footnotes.
But what good is that if financial analysts pretty much ignore each of these disclosures?
And the US Security and Exchange Commission does not require the key real Unrealized Economic Holding Gains and Losses amount be disclosed very prominently in Company Quarterly Earnings Releases. And when it is disclosed, it is buried in a very obscure place in the very lengthy Bank Quarterly Earnings Release.
Then shortly after 2022 year end, on March 8, 2023, SVB disclosed in another SEC filing that it was selling $21 bil of its Available-For-Sale Investment Securities with a 1.79% Interest Yield and a 3.6 Year Duration and that the resultant Realized After-Tax Loss was estimated at $1.8 Bil and it would be reflected in its First Quarter Regular 2023 Earnings.
Then the shit hit the fan and many cash depositors quickly withdrew their cash from SVB Financial Banks to the extent that they could.
Economically, these Unrealized Holding Losses occurred prior to December 31, 2022 but because they were included in Other Comprehensive Income rather than in Regular 2022 Earnings, the financial analysts short-sightedly weren't concerned much about it.
But shortly after December 31, 2022 when the Unrealized Losses were realized and thus be required to be recorded in First Quarter 2023 Regular Earnings, the start of the current banking crisis occurred and now a lot of people are investigating how much each US bank and even some non-financial companies have in real Unrealized Economic Holding Losses at December 31, 2022 and whether they are being wisely hedged and also trying to find out how much additional real Unrealized Economic Holding Losses each US Bank has so far in the First Quarter of 2023.
So it's not just the Bank Board of Directors, the Bank CEOs, the Bank CFOs, the Bank Company Risk Managers, the Financial Analysts of Banks, the US Government Bank Regulators, the US SEC, the US Senators, the US House Banking Committee Members and clearly most of all the US Fed Chair Jerome Powell who are all the predominant causes of this current Banking Crisis by acting incompetently.
But it's also the US FASB for not doing what was and is right ..... making financial disclosure useful to investors.
To Report Income-Smoothed Quarterly Earnings as being anything close to real Quarterly Economic Earnings breaks the back of successful US Capitalism.
From Companies 10-Qs and earnings releases filed with the US SEC, the table below shows the Gold-Standard US GAAP Earnings (Losses) From Continuing Operations for each of the 50 largest by very recent stock market capitalization US Non-Dow 30 Industrials Companies for the third and fourth quarters of both 2022 and 2021.
What Will the Percentage Decline Be in the First Quarter of 2023?
Tesla's Revenues Increased By 37% in the December 2022 Quarter vs Increasing By 56% in the September 2022 Quarter and vs Increasing By 81% in the March 2022 Quarter.
Tesla's Gross Profit Increased By Only 19% in the December 2022 Quarter vs Increasing By 47% in the September 2022 Quarter and vs Increasing By a Huge 147% in the March 2022 Quarter.
Tesla's Operating Income Increased By 49% in the December 2022 Quarter, But That Was Because Tesla Slashed Selling, General & Admin Expenses, Which Declined By 31% in the December 2022 Quarter. On the Other Hand, Tesla's Operating Income Increased By 84% in the September 2022 Quarter and Increased by a Massive 507% in the March 2022 Quarter.
Tesla December 2022 Earnings Release
And even though it has Total Annual Product Revenues of $316 Bil, Apple refused to disclose Its higher Sales Pricing/Mix % Component of its Total Product Revenues % change.
Apple December 2022 Quarter 10-Q
With such very recent huge Sales Growth Deceleration, I now better understand why JNJ is planning a split-up.
Also JNJ refuses to disclose its Higher Sales Pricing and Sales Volume Components of its Adjusted Operational Sales Growth. I wonder what % its Tylenol went up in price?
US Utility Sempra Energy's San Diego Gas & Electric Co's Average Cost of Natural Gas Sold Increased By 68% For the First Nine Months of 2022 From That in the Prior Nine-Month Period.
Sempra Energy September 2022 10-Q
Retail Electric Revenues increased by 31% in the September 2022 Quarter. Of that 31% increase, a huge 25.2% was due to Fuel and Other Cost Recovery, primarily Higher Fuel and Higher Purchased Power Costs. Another 3.6% of the 31% was due to Rates and Pricing.
Wholesale Electric Revenues increased by 64% in the September 2022 Quarter. Of that 64%, 60% was a result of Fuel and Purchased Power increases.
Natural Gas Revenues increased by 37.6% in the September 2022 Quarter. Of the 37.6%, 27.6% was a result of Fuel and Purchased Power increases.
Looking at September 2022 Quarter Total Expenses, Total Fuel expenses were an credible 96% higher and Total Purchased Power Expenses were an even more incredible 124% higher than that in the September 2021 Quarter.
Suffice it to say that Utility Customers cannot be happy with the incredibly high addons to their Utility bills for the higher fuel, for the higher purchased power and for the higher other cost recovery that are being passed on to them.
And there is something seriously wrong with US capitalism when a large Utility Company reports 34% earnings growth but gets there only by passing on a high percentage of its higher costs to its Utility customers.
Corteva's CEO elected to raise its prices dramatically on its products in its most recent five quarters.
From its six most recent Quarterly Earnings Releases and its 10-Qs filed with the US SEC, here are the Higher Pricing Components of Net Sales % Changes for the most recent six quarters:
Keurig DrPepper's CEO elected to raise its prices dramatically on its products in its two most recent quarters.
From its five most recent Quarterly Earnings Releases filed with the US SEC, here are the Higher Pricing Components of Keurig DrPepper's Net Sales % Changes :
Organic Revenue growth eliminates foreign currency effects. In substance, there are two elements to organic growth ..... price increases and volume changes.
LVHM did not report its pricing and volume elements for its 2022 quarters. The only mention of pricing increases was that it said that it had a very firm price increase policy in its Wine & Spirits segment.
Given how huge LVMH's organic Revenue growth was in both its US Region and especially so in its Europe Region in both the second and third quarters of 2022, any reasonable breakdown of this organic growth between Price Increases and Volume impacts should yield double-digits % increases for pricing in both the US Region and especially so in the Europe Region for both the second and third quarters of 2022.
LVMH Louis Vuitton Third Quarter 2022 Revenue
Paccar's truck customers cannot be happy with Paccar's exceptionally high pricing increases on its trucks in 2022.
Honeywell's CEO elected to raise its prices dramatically on its products in its three most recent quarters.
From its most recent Quarterly 10-Q's filed with the US SEC, here are the Pricing Components of Honeywell's Net Sales % Changes :
Lamb-Weston's CEO elected to raise its prices by an almost unbelievable % on its products in its three most recent quarters.
Lamb-Weston November 2022 Press Release
JM Smucker & Co dramatically raised its prices on its products in its three most recent quarters.
JM Smucker & Co Oct 2022 Earnings Release
From its most recent five Quarterly Earnings Releases filed with the US SEC, here are the Price/Mix (Predominately Higher Pricing Inflation) Components of Kellogg's Net Sales % Increases for the most recent five quarters:
Clearly, Kellogg's Pricing Inflation was outrageous in all of 2022.
Its customers cannot be happy with Kellogg's exceptionally high pricing increases of its products all throughout 2022.
From its most recent Quarterly Earnings Releases and 10Qs filed with the US SEC, here are the Price and Mix (Predominately Higher Pricing Inflation) Components of General Mills' Net Sales % Increases for the most recent six quarters:
Clearly, General Mills' Pricing Inflation was outrageous in all of 2022.
Its customers cannot be happy with General Mills' exceptionally high pricing increases of its products all throughout 2022.
General Mills November 2022 10Q
Clearly, W. W. Grainger's Largest Segment's most recent Quarterly Pricing Inflation is extremely high.
Its customers cannot be happy with these extremely high pricing increases on its products.
Clearly, Ferguson's most recent Pricing Component of Its Net Sales Increase is abnormally high.
Its customers cannot be happy with Ferguson's outlandishly high pricing increases on its products.
From its most recent six Quarterly Earnings Releases filed with the US SEC, here are the Prices and Sales Allowances (Higher Pricing Inflation) Components of Campbell Soup's Net Sales % Increases:
Clearly, Campbell Soup's recent Pricing Component of Its Net Sales % Increase is abnormally high recently.
Its customers cannot be happy with Campbell Soup's extremely high pricing increase of its products in its most recent three quarters.
From its most recent five Quarterly Earnings Releases filed with the US SEC, here are the Price/Mix Components of Coca-Cola's North America Segment's Net Operating Revenues % Increases:
Clearly, Coca-Cola North America's recent Pricing Component of Its Net Operating Revenues % Increase is abnormally high.
Its US customers cannot be happy with Coca-Cola North America's extremely high pricing increase of its products in the most recent Sept 2022 quarter.
From its most recent six Quarterly Earnings Releases filed with the US SEC, here are the Higher Price/Mix Components of Conagra Brands' Total Net Sales % Increases:
Clearly, Conagra Brands' recent Pricing Components of Its Net Sales Increases are abnormally high.
Its customers cannot be happy with Conagra Brands' outlandishly high pricing increases of its products.
Clearly, Deere & Co's recent Pricing Component of Its Net Sales Increase is abnormally high.
Its customers cannot be happy with Deere's outlandishly high pricing increases of its products.
Deere October 2022 Quarter Earnings Release
From its most recent five Quarterly Earnings Releases filed with the US SEC, here are the Higher Favorable Price Realization (Inflation) Components of Caterpillar's Worldwide Consolidated Total Sales and Revenues % Increases:
From its most recent six Quarterly Earnings Releases filed with the US SEC, here are the Higher Pricing (Inflation) Components of Worldwide Consolidated Kimberly-Clark's Net Sales Increases: