Powell in Q&A, disaster areas like California wont have mortgages or ATMs in the next decade!

In this weeks testimony on Feb 11, Jerome Powell made a stunning but logical observation.In order to qualify for a mortgage in America you need to have home owners insurance because you are not the home owner until you have made 360 payments. The bank is the owner! Your debt and the house are on their asset column. The mortgage loan is in your liabilities column.So Powell is simply making the deduction that if Californian’s cannot get Fire/Home insurance, then they wont have access to bank mortgages.But for him to openly say this on video is stunning. And no one is talking about it.Go to the Substack for the the full 5 minute news broadcast.This week State Farm requested an Emergency 22% increase in rates for California home owners insurance, which the Insurance Commissioner rejected.I suspect California is on the brink of a real big math problem. One more big wild fire. One big Earthquake or natural disaster, and we may see major structural issues for all Financial institutions that own loans on residential or commercial real estate. Forget “Mark to Market”.It will be “Mark to Uninsurable” values on their loan books in places like California and Florida.Can you blame home insurance companies? Let’s imagine you and I start a new insurance company insuring Malibu or Miami real estate. Shouldn’t we use all the math we can to calculate a risk reward and charge enough premium to make sure we can* A) cover it in case of more wild fires and* B) make a respectable profit doing it?If the state of California prevents that from happening, and forces a fixed rate, then don’t we need to increase the rate of everyone, even those not in disaster areas? It is simply business.Taking a very deep breath as I have family and friends who lost all of their primary home or their investment property in the recent Los Angeles wild fires.The people of California are going to be the big losers. Because as we have seen in the recent past, State Farm and all the financial institutions who are the real owners of these properties, will race to oblivion and be rescued.So we continue to live our isolated lives thinking all is well and someone will save us.It’s time to put on our own capes! This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.notyouradvisor.com/subscribe