Posted on 09/29/2016 4:35:35 PM PDT by The Bat Ladys Husband
I understand it is illegal for the German government to bail out Deutsche Bank per EU rules...?
I kind of hopes it happens now (sooner than later) on the heals of the debate when Trump made the warning.
Deutsche Bank = Lehman Brothers this time around..., global cascades of defaults unless the German Government swallows them up (obviously not willingly, but in desperation! Don't be shocked if our own FED magically creates BILLIONS for the rescue as well!
There are various predictions as to how long this kabuki dance will continue. Remember, the central banks are buying these assets with currency that is backed by, wait for it, nothing more than faith that the present financial system will stay in place forever.
When the those who actually producer something lose faith in the bank's promises to pay, all hell will break loose.
It’s down a whole 10%?
Thats simply horrifying.
Somehow I get the feeling that I still need to be at work tomorrow and my mortgage will still be due.
Obama should write them a nice big check.
This may be why Hellary is saying Merkel is one of her most favorite foreign leaders.
Known in EU jargon as the Bank Recovery and Resolution Directive, the legislation is the centrepiece of efforts to avoid a repeat of the €1.6tn of taxpayer support to banks during the 2008 financial crisis.
It empowers regulators to intervene quickly when a bank is weak, avoiding the panic that could arise from a messy and prolonged insolvency procedure. The law took effect in 2015, but markets were given an extra year to adjust to the most controversial measure: tougher rules imposing losses on a failing bank’s creditors, which kicked in on January 1.
This stipulates that 8 per cent of a bank’s liabilities must be wiped out before any taxpayer support can be provided, placing unsecured senior bondholders and also large corporate depositors on the hook for forced losses, also known as bail-ins.
https://www.ft.com/content/8ad2ed98-d0a0-11e5-986a-62c79fcbcead
The strange thing about Deutch Bank’s situation, is that it seems to be caused by massive fines which are being imposed - billions of dollars for involvement in mortgage products in 2006-2007, and more recently in financial transactions which may have evaded sanctions over the Ukraine situation.
There must be some reason why the powers that be are going after DB in this manner. Other banking houses can get away with almost anything.
You better be concerned, DB has $57 Trillion in Derivatives, more than the entire world economy, and it is just one bank. The part two of that is who are the counter parties to those derivatives?
Germany, The ECU, and The Fed will have no choice but to prop up that bank somehow, it cannot be allowed to fail.
I had a Deutche Bank account decades ago. Fond memories, but I escaped Germany’s stinking socialist hellhole and 70% tax rate.
America’s stinking socialist hellhole should have Trump’s surgical hand. First surgery will be the $5000 Obamacare Hillarycare tax.
Not really. It's more because they have to hold "safe" (cash or negative yield bonds) assets to reduce their risk. They end up reducing their risk so much, they can't make money.
Am positioned for collapse avoidance or growth or inflate.
BRING IT ON!
Germany is the lead nation in the EU - they don’t have to obey the ‘rules’. Who is going to stop them? Do you think Merkel is dumb enough to allow the largest bank in Germany to collapse, and in an election year?
They will simply order the European Central Bank, which they also control, to do anything necessary to fix Deutsche Bank. Equity holders may take a bath, but nobody else will be hurt.
If necessary, they could ask Washington to cool it, in return for the EU taking it easy on Google and Facebook.
There could be a ‘collapse’ but Obama will not allow a panic , which would be detrimental.
He’s designed the perfect downward spiral for America. Very few are complaining.
The myrmidons will cheer when he calls for an increase of chocolate rations to 20 grams from 30.
They will say that Trump “talked down the economy”.
Please let it be mild for a day or two! After 45 months on the market, Isold my house and the closing is tomorrow!
The Deutsche Bank will recover. It is one of the strongest financial institutions in Europe.
Germany is one the strongest economies in Europe.
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https://www.youtube.com/watch?v=33O0jA8fMFw
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