Skip to comments.Pressure is building for Germany to show it's ready to rescue Deutsche Bank
Posted on 09/29/2016 3:56:36 PM PDT by SkyPilot
German officials could be about to find themselves in an uncomfortable position: Being called on to show they're ready to rescue a bank in a part of the world where such operations are considered taboo.
Deutsche Bank came under intensified market fire Thursday, the latest salvo being a Bloomberg report that a small number of hedge funds are trimming their sails at the German bank.
In a broad perspective, the move would represent a minor dent in Deutsche's derivatives clearing business. Barry Bausano, chairman of Deutsche's hedge fund business, told CNBC on Thursday that while there have been some outflows, there have also been inflows, which he said is "part of the typical ebbs and flows" of the prime brokerage business.
But at a time when investors are fearing what the future holds for the highly leveraged institution, such news is enough to cause ripples. Shares tumbled more than 7 percent in mid-afternoon trading. The plunge took the broader market down as well.
Consequently, market talk intensified that it's becoming time for the German government step in and assure investors that it will be at the ready to stabilize both Deutsche and the broader system much along the lines of what U.S. officials had to do during the 2008 financial crisis.
(Excerpt) Read more at cnbc.com ...
Watch the 2 minute video at the link as well.
Reader's Digest version:
- Deutche Bank has 163 Billion in debts (that we know of) and 16 Billion in public equity
- Market is pushing politicians (as they did in 2008) to break them and have governments bail them out
- There is no "anti-Lehman Brothers" mechanism to solve this; and DB is a landmine that could cause a global economic explosion
“...and DB is a landmine that could cause a global economic explosion...”
Yes. Yes they can!
Does Germany HAVE this kind of cash to even GIVE them? Their economy appears to be basically propping up all sorts of undesirables that they’ve INVITED into their country under the guise of ‘workers’ as the Germans have stopped reproducing themselves in meaningful numbers.
Things have not imploded yet, but people are very, very, very nervous.
But things could go south...quickly.
Which means that money will be printed out of thin air and there will be backdoor inflation even though all the indices will indicate there is no inflation.
Just like here, in the States.
Does Germany have The cash ?
Current Account Surplus
Nil gov’t debt
Nil private Debt
answer - yes
As soon as Germany does that the rest of the EU will be with their hands out.
Is this the, ‘Black Swan’ we’ve been waiting for? Been reading about it, today.
PLEASE let it hit before Election Day! ;)
a) Flood Germany with ISIS terrorists
b) BANKRUPT THEM with bank bailouts
That's what Germany gets for being a majority Caucasian country!
Does this mean they want they’re gold back?
I suspect there will be a run on lead, as they need to electroplate lead ingots with gold.
Does China have this kind of cash...and are they interested.
The US gold?
There are lots of reports that ours is already gone.
When TSHTF, they will confiscate citizen's gold....again.
The DB derivative exposure, if it blows, will take the global financial system with it.
Right. Germany does not as country have anywhere close to enough cash to wipe out the debt of this bank. At best they can only kick the can.
“If you think Germany can bail out Deutsche Bank you’re delusional. Their total derivative exposure grossly exceeds the entire net value of everything in Germany! Not just the government’s resources, all private resources as well! In other words even if the government wanted to bail them out, even if they’d survive bailing them out politically they can’t, even if they attempted to confiscate everything of value within the nation.”