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Bank Of England Stress Testing Banks For Property Crash - Risk Of Bail-Ins

GoldCore's picture




 

Today’s AM fix was USD 1,286.50, EUR 942.84 and GBP 778.47 per ounce.
Yesterday’s AM fix was USD 1,282.75, EUR 938.09 and GBP 780.83 per ounce.   

Gold climbed $15.30 or 1.2% yesterday to $1,289.90/oz. Silver rose $0.15 or 0.75% to $20.20/oz.

 


Are Your Savings Safe From Bail-In? (GoldCore)

Gold is marginally lower today in all currencies after eking out more gains yesterday after Yellen confirmed in her testimony that ultra loose monetary policies and zero percent interest rate policies will continue.

Citi Futures are looking for gold to increase by a further 8.5% by the end of March after gold closed above its 50 DMA every day for the last two weeks and closed above its 100 DMA for two straight days. RBC are less bullish but expect gold prices to increase another 10% and surpass $1,400/oz in 2014.

Gold touched resistance at $1,294/oz  yesterday. A close above the $1,294/oz to $1,300/oz level should see gold quickly rally to test the next level of resistance at $1,360/oz. Support is now at $1,240/oz and $1,180/oz.

Yellen confirmed that the U.S. recovery is fragile and said more work is needed to restore the labor market. She signalled the Fed’s ultra loose monetary policies will continue and the Fed will continue printing $65 billion every month in order to buy U.S. government debt.

The dovish take from Yellen's testimony yesterday should support gold prices. Continuing QE makes gold attractive from a diversification perspective.

Market focus shifts from the U.S. to the UK today and the Bank of England’s quarterly inflation report.

The U.K. has already almost breached the unemployment level that was a target for considering tightening policy, and Governor Mark Carney is widely expected to update the market on interest rate guidance.

Possibly of more importance is the fact that the Bank of England is to test whether UK banks and building societies would go bust if house prices crash. A ‘stress test’ will examine whether banks will need bailing out, or bailing in as seems more likely now, if house prices materially correct again.

Preparations have been or are being put in place by the international monetary and financial authorities, including the Bank of England for bail-ins. The majority of the public are unaware of these developments, the risks and the ramifications.

The test is being drawn up by the Bank’s Financial Policy Committee, whose members include Governor Mark Carney.

A Nationwide Building Society survey just out showed house prices had risen by 8.8% in January over the same month last year. London house prices have all the symptoms of a classic bubble.

Many UK banks are already over extended and the real risk is that many banks would not be able to withstand house price falls. This heightens the risk of bail-ins.

Download our Bail-In Guide: Protecting your Savings In The Coming Bail-In Era(11 pages)

 

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Thu, 02/13/2014 - 03:29 | 4431461 James
James's picture

Because if those large banks admit to insolvency at the level they truly are the whole system implodes.

It is at those banks that all the Pensions, Munis',Bonds (City and Corp.), etc. is at.

City, State, and Federal property was built w/money that won't be there to repay the Bonds for example.(Schools, Hospitals,Police and Fire, City Hall) And that's before Pension and Healthcare commitments for Retirees.

Those Malls around you all have a huge mortgage on properties that are of little value. Those big banks hold the note.

Corps in your State and Town are financed thru these banks. The stronger corps are what those banks sell stock of. Their Pensions are at those banks invested into Stocks.

And on it goes........................

 

Thu, 02/13/2014 - 07:09 | 4431613 StychoKiller
StychoKiller's picture

See the glory...of the Royal Scam!

Thu, 02/13/2014 - 11:01 | 4432091 Panem et Circus
Panem et Circus's picture

Leverage is everywhere, and permeated into the very being of all things. That's why the show must go on, at all costs, until suddenly it cannot. Bread (welfare/food stamps/obamaphone/obamacare/free shit army) and circuses (hollywood/sports/politics) for everyone until it collapses. Then it's if you can't hold it, you don't own it.

Thu, 02/13/2014 - 00:21 | 4431156 SAT 800
SAT 800's picture

Why wouldn't it be better to just let the banks fail; replace the losses of the citizens by printing; which wouldn't be creating new money, and just let some new banks take a try. Is it better to hurt everyone or only a few bankers? Seems like an easy question.

Thu, 02/13/2014 - 07:04 | 4431608 layman_please
layman_please's picture

first, because they are the real masters who everybody else serves. and second, they have built the system to their liking which is upside-down leveraged pyramid with them at the tip on which it's all resting. James pretty much summed it up below.

Wed, 02/12/2014 - 21:02 | 4430376 Randoom Thought
Randoom Thought's picture

Nothing wrong with haircuts as long as they are also applied equally to corporate accounts, hedge fund accounts, government accounts and bank to bank overnight deposits.

Unless they are willing to not discriminate against the powerless people, simply because of their status of being powerless, maybe they should find another solution, such as writing off non-deposit debt, cutting the salaries of their employees and especially their executives and THEN restructuring.

Wed, 02/12/2014 - 19:00 | 4430082 AdvancingTime
AdvancingTime's picture

A bad haircut, in this case means you have been robbed. That may be the case if the government reaches in over a long weekend and steals money from your bank account. This is a horrible precedent to set, and the worst part may be how some people are letting it slip out that it would be fair, or in some way justifiable if it is only on the larger accounts. It is fine if it only impacts the savings of someone else, the savings of what they see as "the wealthy", the problem is someday they may come for you. More about bail-ins in the post below,

http://brucewilds.blogspot.com/2013/03/a-bad-haircut-seizing-bank-accoun...

Wed, 02/12/2014 - 19:25 | 4430198 Cynthia11640
Cynthia11640's picture

I keep reading about bail ins.  Please point me to the legislation where the law is changing.  I'd like to be able to read it.  Thank you.

Thu, 02/13/2014 - 13:17 | 4432716 Going Loco
Going Loco's picture

There is no need for a change to any law in most countries because the law of receivership of insolvent banks generally instructs the receiver to treat desposits as unsecured loans to the bank.

Wed, 02/12/2014 - 23:46 | 4431076 carpman
carpman's picture

https://encrypted.google.com/webhp?hl=en#hl=en&q=2009+banking+act+uk+%26...

In the UK, 2009 Banking Act (that's the basis -- maybe later amendments as below?) these provisions were made some time ago ...

"The SRU is also working with the other UK Authorities to consider how best to enhance the SRR to comply fully with the FSB’s Key Attributes of Effective Resolution Regimes, endorsed by G20 Leaders in November 2011 as the international standard for resolution. This will require broadening the scope of the SRR stabilisation powers to include other financial institutions whose failure could be systemic, including holding companies and investment firms, and extending the SRR toolkit to include an explicit power to bail in unsecured and uninsured creditors of a failing bank."

Source: http://www.bankofengland.co.uk/financialstability/Pages/role/risk_reduct...

Thu, 02/13/2014 - 08:46 | 4431725 new game
new game's picture

a  written law - really, does a thief obey the law? can not even believe what I read!

they will become desparate and steal from the easiest mark, bank deposits right under their feet-hello, anyone home!

fucken-eh...

Wed, 02/12/2014 - 22:33 | 4430843 TheReplacement
TheReplacement's picture

Why does there have to be a written law?  Our own government won't enforce any laws it doesn't agree with nor will they not prosecute issues that are not outlawed. 

Oh, yeah... you don't follow the news do you?

Thu, 02/13/2014 - 10:54 | 4432071 RaceToTheBottom
RaceToTheBottom's picture

I bet the laws are already in place. 

Plus, One word change and the 200K (or is it 250K) guarentee in the US becomes per person, not per institution.  That will take at least 6 months to confirm and total up, so freezing the accounts (like Greece) will be required.... and more and more

Thu, 02/13/2014 - 10:54 | 4432065 RaceToTheBottom
RaceToTheBottom's picture

I bet the laws are already in place.  One word change and the 200K (or is it 250K) guarentee in the US becomes per person, not per institution.  That will take at least 6 months to confirm and total up, so freezing the accounts (like Greece) will be required....

Wed, 02/12/2014 - 17:27 | 4429674 falak pema
falak pema's picture

stress tests will be awesome in what they don't show up both in UK as in Europe.

Watch out for this woman : Daniele NOUY she is the new regulator of EU banking consolidation.

She is causing as much distress amongst french banks as EW in the US ! 

Its takes an honest woman to cut off the nuts of these Banksta Oligarchs. 

Thu, 02/13/2014 - 10:49 | 4432054 RaceToTheBottom
RaceToTheBottom's picture

She will be marginalized, sidestepped, removed, etc. 

 

The Banksters must win.

Wed, 02/12/2014 - 16:56 | 4429520 The Wisp
The Wisp's picture

So when they say,  " We're going to Test "

it means... " We Know there Failing "  but were going to pretend to Look See.. and they're goint to pretend to Fix it.  when it's Discovered

Wed, 02/12/2014 - 17:06 | 4429574 Zero-risk bias
Zero-risk bias's picture

I think that's pretty accurate.

Wed, 02/12/2014 - 16:24 | 4429314 sixbilliondollarman
sixbilliondollarman's picture

anyone every even read these coldcore articles anymore?

***************************************

all you need to know is this:

YELLEN = GOLD UP

ONCE GOLD GOES UP ENOUGH...IT CANNOT BE STOPPED ANYMORE BY "ROLLYPOE-LLY"

LOOK AT THESE FAGS FROM THESE BANKS NOW SAYING "IT'S GOING TO GO UP". FUCK OFF!

YOU CAN'T HOLD IT DOWN SHITCOIN LOVERS ANY LONGER.

ALL JET ENGINES JUST TURNED ON!

*****************************

EVERYONE KNOWS IT NOW

YOU HAD 3 MONTHS TO LOAD UP LIKE ANMIDDLE INCOMED INDIAN WORKING AT A CHINESE BANK.

DID YOU DO IT?

SILVER...STILL CHEAP [IF YOU CAN FIND SOME FO TO SELL IT TO YOU AT SPOT]

TIME TO GO TO MY MINIMUM WAGE PART-TIME JOB NOW. BYE

http://www.youtube.com/watch?v=uMVmhI1SUq0

 

Wed, 02/12/2014 - 15:06 | 4428918 thefirstabomb
thefirstabomb's picture

http://dhnnews.com/the-bank-of-england-has-confirmed-that-economic-forec...
At least they are honestly admitting that forecasting (at least further than several weeks out) is just a bunch of smoke and mirrors 

Wed, 02/12/2014 - 14:57 | 4428862 dizzyfingers
dizzyfingers's picture

NO ONE is safe from the criminal manipulations OF BANKERS, but what are we supposed to do about that if governments do nothing...or rather, when governments close their eyes and put their open palms out for their payoffs?

Wed, 02/12/2014 - 14:18 | 4428722 bagehot99
bagehot99's picture

All your assets are belong to us.

Wed, 02/12/2014 - 15:05 | 4428899 disabledvet
disabledvet's picture

this would go a lot longer way to explaining the huge move in the price of gold to start the year than "China."

Thu, 02/13/2014 - 10:46 | 4432045 RaceToTheBottom
RaceToTheBottom's picture

But I thought that FDIC guarantee was free

Wed, 02/12/2014 - 17:27 | 4429685 rocker
rocker's picture

You may explain some of it like this. Unlike Goldman and BAC, First Mariner Bancorp, FMAR, is now filing for Bankruptcy.

 

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