Elon Musk, the chief executive officer of Twitter, reportedly expressed his belief, as expressed in an interview that he gave on Tuesday night, that the United States may be on the edge of significant financial troubles later this year as a result of a combination of dire circumstances.
In an interview with the presenter of Fox News, Tucker Carlson, Elon Musk stated that the failure of a number of significant financial institutions, such as Silicon Valley Bank, is an indication that there will soon be potentially extreme economic conditions ahead.
“We have a situation here where it’s not merely — it’s not that the canary in the coal mine has died, but the miners are starting to die, too. Silicon Valley Bank collapsing overnight is a one hell of a big canary. … I think that there is a serious danger with the global banking system.” Musk said.
Musk stated that he is of the opinion that the commercial real estate properties that have been vacated as a result of the pandemic will make the problems that banks are already experiencing much worse.
“So, we really haven’t seen the commercial real estate shoe drop.That’s more like anvil, not a shoe. The stuff we’ve seen thus far actually hasn’t even — it’s only slightly real estate portfolio degradation, that will become a very serious thing later this year in my view.” he continued.
According to Musk, this is due to the fact that these properties were considered to be hard assets that held a significant amount of value for the banks.
Musk also predicted that there would be a continuation of the upward trend in inflation because the Federal Reserve would not lower interest rates during an election year.
Musk continued by criticizing the United States federal government for adopting the COVID stimulus measures, stating that the laws “were not paid for” and that as a result, they considerably contributed to an increase in inflation.