The FDIC recently issued a chilling warning: U.S. banks are facing a staggering $364 billion in unrealized losses, with the true number likely much higher. According to FDIC Chair Martin Gruenberg, the figure is closer to “half a trillion dollars.” These unrealized losses stem primarily from long-term bonds and commercial real estate—once considered safe investments. But rising interest rates and market volatility have transformed these assets into ticking time bombs, threatening the stability of the entire financial system.

The Roots of the Crisis

Taylor Kenney of ITM Trading breaks down how this crisis came to be. “When the federal government takes on enormous debt—say, $13 trillion in the last five years—that debt creation doesn’t live in a vacuum. It floods the system with cash,” Kenney explains. Banks, flush with deposits, invested heavily in long-term Treasury bonds, assuming low interest rates would persist. But as interest rates rose to combat inflation, bond prices plummeted, creating massive unrealized losses.

Kenney highlights the magnitude of the problem: “Banks across America have the least amount of reserves in history, combined with assets that are actually liabilities.” In other words, the very financial instruments banks rely on to balance their books are now a major source of instability.

Why This Time Is Different

Unlike 2008, when the government bailed out failing banks with taxpayer money, the current crisis could play out differently. Kenney points to a growing risk of “bail-ins,” where banks use depositor funds to stabilize their balance sheets. “One of the biggest lies we’ve been sold is that the FDIC has enough funds to cover our deposits. In reality, the FDIC has less than 2% of all total insured deposits in its Deposit Insurance Fund,” she warns.

This means that in the event of widespread bank failures, the government could be forced to step in again. But with national debt already at record levels and inflation still running dangerously high, printing more money would only exacerbate the problem. Kenney puts it bluntly: “This time will be different, and it will be much worse. Hyperinflation is not just an economic term but a devastating reality.”

The Threat of a Currency Reset

As banks face mounting liquidity pressures and depositor withdrawals, Kenney warns that the system is inching closer to a currency reset. “When a currency collapses, there is only one solution in a currency’s life cycle, and that is a reset,” she explains. This could take many forms: pegging the dollar to gold, introducing a new digital currency, or even revaluing the currency by lopping off zeros—actions that have happened in other countries during financial crises.

Kenney compares the current situation to holding a house that has lost value: “Imagine you buy a house for $700,000, and a couple of years later, it’s worth $500,000. On paper, you haven’t lost that $200,000—unless you’re forced to sell. Banks are in the same position, but on a massive, half-a-trillion-dollar scale.”

What You Can Do to Protect Yourself

This escalating financial crisis poses a direct threat to your savings, retirement accounts, and purchasing power. As inflation continues to erode the value of the dollar, Kenney urges viewers to take proactive steps: “Every day, we are in the process of a currency reset. The question is, will you be prepared when the event happens?”

If you’re concerned about how this crisis could affect your wealth, now is the time to act. At ITM Trading, we specialize in helping individuals protect their assets from systemic risks like inflation, hyperinflation, and financial resets. Our team studies currency life cycles and creates personalized strategies to ensure our clients are prepared for any economic downturn.

Take Action Today

Secure your wealth before the reset hits. Learn how to safeguard your assets from these escalating risks with a personalized wealth protection plan. Schedule your free strategy call now at Book Your Call Here or call 866-351-4219. Don’t wait—every day brings us closer to the tipping point.

Final Thoughts

The FDIC’s warning is not just a headline—it’s a wake-up call. With $364 billion in unrealized losses, rising interest rates, and record-breaking national debt, the financial system is more fragile than ever. Whether it’s hyperinflation, a bank bail-in, or a full-blown currency reset, the risks are too great to ignore. As Kenney says, “Prepare now, because the window to act is closing fast.”