Short BanksBanks are going to start needing to raise capital (or the Fed will raise capital requirements) to cover projected losses as the size of bad loans gets bigger. This will come from the growing size of corporate loans (public and private) as well as the growing size of bad mortgages in aggregate. Additional risk will come from over-leveraged funds and individuals who tank their accounts...as interest rates rise, the faster banks will make margin calls and break their clients. If clients have negative balances, the banks end up losing money on the margin loans. See recent events i.e. Archegos.
