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Bombshell: Deutsche Bank Hid $12 Billion In Losses To Avoid A Government Bail-Out

Tyler Durden's picture




 

Forget the perfectly anticipated Greek (selective) default. This is the real deal. The FT just released a blockbuster that Europe's most important and significant bank, Deutsche Bank, hid $12 billion in losses during the financial crisis, helping the bank avoid a government bail-out, according to three former bank employees who filed complaints to US regulators. US regulators, whose chief of enforcement currently was none other than the General Counsel of Deutsche Bank at the time!

From the FT:

The three complaints, made to regulators including the US Securities and Exchange Commission, claim that Deutsche misvalued a giant position in derivatives structures known as leveraged super senior trades, according to people familiar with the complaints.

 

All three allege that if Deutsche had accounted properly for its positions – worth $130bn on a notional level – its capital would have fallen to dangerous levels during the financial crisis and it might have required a government bail-out to survive.

 

Instead, they allege, the bank’s traders – with the knowledge of senior executives – avoided recording “mark-to-market”, or paper, losses during the unprecedented turmoil in credit markets in 2007-2009.

 

Two of the former employees allege that Deutsche mismarked the value of insurance provided in 2009 by Warren Buffett’s Berkshire Hathaway on some of the positions. The existence of these arrangements has not been previously disclosed.

Naturally, DB is defending itself in the only way it knows: "this is complicated stuff, and we know better than those guys." In other words, this is just a "tempest in a teapot." Where have we heard that before...

The bank said the investigation revealed that the allegations “stem from people without personal knowledge of, or responsibility for, key facts and information”. Deutsche promised “to continue to co-operate fully with the SEC’s investigation of this matter”.

 

The complaints were made at different times in 2010 and 2011 independently of each other. All of the men spent hours with SEC enforcement attorneys and provided internal bank documents during multiple meetings, people familiar with the matter say.

SEC enforcement attorneys eh? Because this is where it gets really fun: the person who was in charge of DB's legal compliance at the time was none other than Robert Khuzami. The same Robert Khuzami who just happens to be the chief of enforcement at the SEC!

Robert Khuzami, head of enforcement at the SEC, has recused himself from all Deutsche Bank investigations because he was Deutsche’s general counsel for the Americas from 2004 to 2009. Dick Walker, Deutsche’s general counsel, is a former head of enforcement at the SEC. The SEC declined to comment on the investigation.

Sadly, the "we are too sophisicated" defense may not be very effective this time.

Two of the former Deutsche employees have alleged they were pushed out of the bank as a result of reporting their concerns internally.
One of them, Eric Ben-Artzi, a risk manager at Deutsche, was fired three days after submitting a complaint to the SEC. In a separate complaint to the Department of Labor, he claims his dismissal was retaliation for his allegations.

 

Matthew Simpson, a senior trader at Deutsche, also left the company after submitting his own complaint to the SEC. Mr Simpson declined to comment. Deutsche Bank paid Mr Simpson $900,000 to settle his anti-retaliation lawsuit. Reuters reported in June 2011 that Mr Simpson had raised concerns about improper valuation of the derivatives portfolio.

 

The third complainant, who worked in risk management and has requested anonymity, raised his concerns to the SEC and voluntarily left the bank.

Or actually, since every bank in the world is forced to lie, cheat and mismark its own balance sheets every single day, not least of all the European Central Bank which as of moments ago has to accepted defaulted Greek bonds as collateral, this may just be completely ignored.

After all opening this particular Pandora's Box may well reveal that not only DB but the world's entire financial system is completely and totally insolvent.

* * *

And for those curious why the SEC's chief enforcer will never lift a finger against his own bank, all other considerations and recusals aside, here is what we wrote back in May 2010

Robert Khuzami Stands To Lose Up To $250,000 If He Pursues Action Against Deutsche Bank

When the SEC'a Robert Khuzami recently recused himself of pursuing an investigation against Deutsche Bank in regard to potential CDO malfeasance, a bank where it is common knowledge the CDOs flowed (and were shorted "where appropriate" by Mr. Lippmann and his henchmen) like manna from heaven, we were curious just how large the conflict of interest must be for him to not pursue his official duty. Luckily, we were able to answer this question when we recently encountered Mr. Khuzami's Public Financial Disclosure Report for Executive Branch Personnel. It appears that Mr. Khuzami, who from 2002 to 2009 worked at DB, most recently as General Counsel, might have directly profited quite handsomely from the very activity he is now prosecuting Goldman, and other banks very likely soon, for engaging in. How handsomely? His 2007 bonus, 2008 salary and bonus, and 2009 salary added up to $3,804,537. This works out to about $1.9 million in comp per year. And let's not forget that 2006/2007 was the peak years for DB's CDO issuance. It sure seems Mr. Khuzami benefited nicely as a participant in precisely the kind of CDO gimmickry that he is currently all over Goldman for. Yet most ironic, is that Robert is expecting to receive between $100,001 and $250,000 in vested deferred stock comp from Deutsche Bank in August 2010. Should he, or someone else at the SEC, commence an investigation into Khuzami's former employer, the SEC's Director of Enforcement is sure to lose a substantial amount of money tied into the absolute value of Deutsche Bank stock.

And it doesn't end there. Khuzami lists the following asset holdings as of June 2009:

  • Federated US Treasury Cash Reserves: $1,001-$15,000
  • US Treasury Cash Reserves: $1,000,001-$5,000,000
  • Fidelity Advisor New Insights Fund: $15,001-$50,000
  • Henderson Int'l Opportunities Fund: $15,001-$50,000
  • Deutsche Bank Cash Account Pension Plan: $100,001-$250,000
  • DB Stable Value Fund: $1,001-$15,000
  • Goldman Sachs Mid Cap Value Fund: $1,001-$15,000
  • Dodge and Cox Int'l Stock Fund: $50,001-$100,000
  • SSGA Money Market Fund: $15,001-$50,000
  • Delaware Emerging Markets: $50,001-$100,000
  • Gateway Fund (401k): $15,001-$50,000
  • Third Avenue Real Estate Fund (401k): $15,001-$50,000
  • Touchstone MidCap Growth Class A (401k): $15,001-$50,000
  • Wells Fargo Endeavor Select FD (401k): $15,001-$50,000
  • Yacktman Fund (401k): $15,001-$50,000
  • PIMCO Real Return Class A (401k): $50,001-$100,000
  • Principal Short-Term Fixed Income (401k): $1,001-$15,000
  • Personal Residence - New York (Gross Rental Income): $1,000,001-$5,000,000
  • Deutsche Bank Common Stock (Vested Amount Compensation): $100,001-$250,000
  • Vanguard 529 Moderate: $50,001-$100,000
  • Vanguard 529 Aggressive: $1,001-$15,000

It appears Mr. Khuzami has done quite well while working in the private sector, undoubtedly defending his German employer from precisely the same actions he, or someone else at the SEC, may soon charge the firm was defrauding investors by. His total disclosed asset range from $2,525,000 to $11,375,000. It is also ironic that nearly half Mr. Khuzami's assets are contained in real estate, and not to mention that a substantial amount of his assets are also contained in Deutsche Bank plans as well as DB stock deferred comp. In fact, let's take a look at that deferred comp of $100,001-$250,000 a little closer.

It appears the SEC's Enforcement Director has between $100,001 and $250,000 in DB deferred stock compensation, which becomes payable in August 2010. Obviously this is not a trivial number. And while Khuzami may have recused himself from pursuing DB for CDO infarctions, that does not mean that some other SEC enforcer (surely, their $1 billion a year budget allows them at least more than one enforcement professional) would not be able to go after DB. The problem as we see it is that since the announcement of the SEC case against Goldman the firm has lost about 25% of its market cap. It is conceivable that DB, which dabbled far more in CDOs, and thus the SEC would have a much stronger case agaisnt the bank, would thus lose far more of its market cap should the SEC announce a case against the Germans. In fact, we could be looking at Mr. Khuzami's Vested Deferred Compensation value dropping from $100,001 - $250,000 to maybe even as low as $15,001-$50,000. Then again, this becomes irrelevant after August, when the former DB GC will have collected all his dues. Does this mean we should expect nothing from the SEC against Deutsche Bank for at least 4 more months? And is September 1 the day when the SEC formally announces charges against Deutsche? We would love to get the SEC's feedback on this.

Mr. Khuzami's potential conflicts of interest do not end with his open exposure to Deutsche Bank. His Schedule A appendix indicates that the man has open equity positions with firms such as Bank of America, Deutsche Bank, and JP Morgan. To wit:

Would this mean that Mr. Khuzami, and thus the entire SEC Enforcement Division, if judging by the Deutsche Bank case study, would recuse itself of investigating these three firms from an enforcement standpoint?

We certainly do not begrudge Khuzami's generous winnings as part of the private sector. If anything, any borderline criminal activity he may have helped cover up as GC of Deutsche (an act he was supposed to do so no ill-will there) should provide him with the knowledge to prosecute just such activity. However, when the head of the main US regulator's enofrcement body is so terminally ensnared in not just the Wall Street complex, but in the very fabric of Keynesianism (that up to $5,000,000 Treasury holding for example and not to mention his up to $5,000,000 rental property), the population should ask just how extremely biased this man can be when prosecuting the very system that allows him to have up to $11 million in assets currently tied in to the perpetuated status quo. Surely, should the Fed, and the market in general, be "surprisingly" uncovered to be the same ponzi construct as Madoff's pyramid scheme, Khuzami, and who knows how many other people, stand to lose virtually the bulk of their assets. This makes them very much conflicted in any real enforcement action, and certainly not independent or impartial. Perhaps Dodd, in his joke of a bill, can consider just how to establish a securities regulator which by its very nature is not constantly in bed with the very subject it is supposed to be investigating.

 

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Wed, 12/05/2012 - 18:02 | 3037334 stormsailor
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and meanwhile, in other news.  water is still wet, and the sky is blue.

Wed, 12/05/2012 - 18:10 | 3037358 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

DB down 4% after hours....

Wed, 12/05/2012 - 18:14 | 3037377 BurningFuld
BurningFuld's picture

Nice!

Wed, 12/05/2012 - 18:23 | 3037410 nope-1004
nope-1004's picture

TBTF banks = insolvent.  Insolvent and still operating = Fraud.

 

Wed, 12/05/2012 - 18:42 | 3037456 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The question I want answered is what are the Central Banks waiting for to let the system collapse?  Obviously they could have let it collapse in 2008, but they didn't and they increased the leverage of debt.  So let's say they keep bailing out insolvent banks for year after year, everytime increasing the leverage.  Soon all currencies are devalued 33% from where they are now and oil has increased in price so that GDP is once again negative.  Now they system does collapse because people can not afford to drive to and from work and school and on and on.

Then the World Bank and IMF come in and try to supercede power from the 1st World Nation-States and ask for our hand in a One World Currencey in exchange for our gold reserves.  Now the UN runs everything and it doesn't matter where you live, anyone can become the Chair at the BoE!

So now we know the plan but do we know how to stop them....

Yes we do....

Take back the real money supply, and buy as much gold and silver in physical form as you can.  These are good prices historically as when rates increase gold rises (evidence is the 1970's) and inflation adjusted (using 1980 as the baseline) gold is $800.

Wed, 12/05/2012 - 19:10 | 3037465 Michaelwiseguy
Michaelwiseguy's picture

Million Man Gun March on Washington D.C. to stop the Federal Government from giving away US Monetary Sovereignty.

I can see the Military joining us in this effort to have Fort Knox Audited, The Federal Reserve Corporation Nationalized, and have a new Gold backed currency established.

And we'll back that up with an epic gun fight if necessary.

Wed, 12/05/2012 - 19:19 | 3037538 THX 1178
THX 1178's picture

Everything's a bombshell.

Wed, 12/05/2012 - 19:42 | 3037607 The Alarmist
The Alarmist's picture

So, now that their DB bonus shares are vested and delivered, they feel duty bound to blow the whistle.  DB ought to exercise the clawback right buried in the fine print of the T&C's.

Wed, 12/05/2012 - 20:27 | 3037715 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

My question is why would Douche Bank avoid a bailout? Was it not every bank's dream to get out of the red on taxpayer's money?

Wed, 12/05/2012 - 21:19 | 3037808 wisefool
wisefool's picture

As I understand it, there are branding considerations, in addition to compensation controls.

For example, in the US, General Motors effectively got bailed out 3 or 4 times already. 2 more to come within the next year. Ford did not get a bailout, but they did recieve marginal benefits in that the shared parts of the supply chain did not collapse.

Some people were biased twords Ford non-bailout status, increasing the value of that brand over GM.

Wed, 12/05/2012 - 21:43 | 3037870 jayman21
jayman21's picture

Ford has been getting a reach around bail out from the Department of Energy.  Tyler posts the handouts every quarter and Ford always tops the list.

Wed, 12/05/2012 - 22:18 | 3037963 wisefool
wisefool's picture

Good point and thanks. Kinda like how solyndra: 1 green company, out of thousands, that never produced a product, got as much tax payer money from D.o.E.  in 1 year than all the oil companies (combined) got in 50 years (combined) for their tax perk.

Its all soo complicated.

Wed, 12/05/2012 - 23:19 | 3038122 jayman21
jayman21's picture

Wisefool - the bread and circus is complicated.  The underlying objective is simple.  Take as much from the sheep as possible without upsetting the apple cart.  The gov't borrows from the Private Federal Reserve Corporation which is printed money and charges interest.  They call it debt to keep the sheep confused.  The interest is paid with our taxes which is the largest one line item on the budget.  This steals from everyone who has saved.

 

 

Wed, 12/05/2012 - 23:39 | 3038159 camaro68ss
camaro68ss's picture

Banks hiding losses... Noooo you don't say. Zero hedge has really jumped the shark on this one. Haha

Thu, 12/06/2012 - 01:26 | 3038306 old naughty
old naughty's picture

"...water is still wet, and the sky is blue."

Liquid must flow and rain needs clouds (so gray sky!).

but but would it not read as: They hid to make sure they got bail outs?

I am confused.

Wed, 12/05/2012 - 19:55 | 3037637 SMG
SMG's picture

If only I knew that were true for sure.  There's been so many false hopes the last few years, I'm worn out. 

Still hopeful till the end though.

Wed, 12/05/2012 - 21:12 | 3037799 Seer
Seer's picture

Million Man March, really?

The only thing that govts understand is violence.  With all the sonic cannons, drones and whatever else comes out of the govt's secret labs such a "march" would wind up being one big slaughter.

It's been tried: Shays rebellion.

The System derives its power from PARTICIPATION.  Remove your energies from it and it folds.  Not saying that violence and killing won't happen, but there's no surer way of guaranteeing it than to go all-confrontational.

Required reading: The Art of War

Wed, 12/05/2012 - 23:20 | 3037874 jayman21
jayman21's picture

You will be called a terrorist.  That knock on the door might not be friendlies.

 

 

Wed, 12/05/2012 - 23:32 | 3038143 Whiner
Whiner's picture

I am in. Figure out how the PTB can't spin it as Goldfinger looting Ft. Knox. We've enough relationships in the military for a quiet coup, but we goota promise them their place as the Heros of history under a new nation thy shepherd into existence, new constitution, etc. Will have to liquidate many obstacles, peacefully, no killings, just buy them off quietly as we can.

Wed, 12/05/2012 - 19:02 | 3037503 Urban Redneck
Urban Redneck's picture

The US effectively controls the WB & IMF (which rules out their use against massa in the short term), the BRICS didn't get the increased voice they sought at the existing table, so look to the buildup of regional trade and currency blocks...

Wed, 12/05/2012 - 19:47 | 3037620 john39
john39's picture

read their symbols... they are waiting for their god...

Wed, 12/05/2012 - 20:19 | 3037696 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

They think they are the gods.

Wed, 12/05/2012 - 21:15 | 3037804 BLOTTO
BLOTTO's picture

And 'they' *think* its their divine right to rule over us...us commoners.

.

Maybe they are stalling for the right time based on the signs/astrology they have been following for eons.

.

They follow a different set of laws/rules.

Wed, 12/05/2012 - 22:56 | 3038060 eatthebanksters
eatthebanksters's picture

The MSM won't even report this...Khuzami is one of the king's protected cronies

Thu, 12/06/2012 - 01:42 | 3038337 IrritableBowels
IrritableBowels's picture

Symbols of an Alien Sky

Hang onto your seat.

Wed, 12/05/2012 - 20:14 | 3037686 sessinpo
sessinpo's picture

Hendrix: "The question I want answered is what are the Central Banks waiting for to let the system collapse? "

 

Comment: It goes on as long as the people trapped within the system, you and I, let it go on. If you were a drug dealer, why would you cut off your junkies as long as they pay?

They will continue to leverage the average citizen until the citizen either can no longer or will no longer be leveraged into further corruption and slavery.

Wed, 12/05/2012 - 21:06 | 3037791 Seer
Seer's picture

"The question I want answered is what are the Central Banks waiting for to let the system collapse?"

There are two reasons:

1) Too much offsetting weight against UN and IMF: China and Russia;

2) Energy, oil specifically.

For item #1 there has been a slow and steady attack.  UN/IMF, um... US has been working very hard to redeploy its military into that region.  I think that there's likely a lot of energy being put in place to force a wedge between Russia and China.

Iran's oil needs to be in the hands of the "West."  The UN/IMF/US can't compete push over Russia and Iran.  Obviously Russia cann't be a straight up confrontation, in which case the attack point is via Iran.  Why is this important?  Just look at how much control Russia has over nearly all of Europe: natural gas being biggest control point.  The US loses its strength if it doesn't have the likes of the UK, France and Germany to rubber-stamp its actions.  Without the UN/IMF the US has to perform naked aggression, something that will pretty much be the end of any possibility of creating anything even remotely promoting international "stability," ever again.

When both of the above are sufficiently secured (or should it be obvious that the end game is now) the US will tell China to go jump, that it will default on its debts.

I'm amazed that people on ZH can be so convinced of the efficacy of guns yet fail to realize that it works the other way too, and that TPTB have a heck of a lot more firepower.  Whatever TPTB needs it will get, and, as the US' State Department likes to say all so frequently: "all options are on the table."  Hungry people will make a pact with the devil; the US military will likely become food providers...

That TPTB are trying to coalesce even more is only natural in the big power game.  I don't rule out the possibility of them achieving it; BUT, achieving and maintaining are two completely different animals, and it's here that I don't see it being able to be maintained: my simple equation of BAD = FAIL (and BIG = FAIL) guarantees it won't work.

Wed, 12/05/2012 - 21:21 | 3037812 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You have too much faith in the MIC. 

If the MIC can't collect taxes, they are done.  The power lies in our hands, not theirs.

Wed, 12/05/2012 - 22:01 | 3037919 catacl1sm
catacl1sm's picture

Who needs taxes when you can just print?

Wed, 12/05/2012 - 23:46 | 3038175 jonjon831983
jonjon831983's picture

If these things can be hidden for so long, why reveal it so soon?

A crisis is always a good opportunity.  So, hold onto the crisis card until you have positioned yourself to accomplish a goal and then unleash hell.

Wed, 12/05/2012 - 19:45 | 3037613 jamezelle
jamezelle's picture

Government = insolvent. Insolvent and still operating = Fraud

 

FTFY

Wed, 12/05/2012 - 20:49 | 3037754 Seer
Seer's picture

Entire Model (perpetual growth on a finite planet = Ponzi) = Fraud

Wed, 12/05/2012 - 18:17 | 3037390 Michaelwiseguy
Michaelwiseguy's picture

By going off the so called Fiscal Cliff January 1st, does that mean we can retire the "Bush Tax Cuts" meme from there on out?

For that reason alone, I say go over the Fiscal Cliff at ramming speed.

Wed, 12/05/2012 - 19:34 | 3037583 DoChenRollingBearing
DoChenRollingBearing's picture

Mr Lennon Hendrix

You know as well as I do: Deutschland uber alles!

Wed, 12/05/2012 - 19:38 | 3037587 GoNavy
GoNavy's picture

And if DB can do it and get away with it, others can (and probably have), so get your short orders in now.

 

And Chairman Bernanke,  get ready for a very busy day tomorrow.

Wed, 12/05/2012 - 22:23 | 3037980 yogibear
yogibear's picture

Exactly! Mark to fantasy.  They will push the whole financial fraud game until citizens react with force.

Wed, 12/05/2012 - 20:08 | 3037668 Debt-Is-Not-Money
Debt-Is-Not-Money's picture

I hear the bank will be re-named to "Douche" Bank!

Wed, 12/05/2012 - 22:47 | 3038044 Silver Bug
Silver Bug's picture

What a shocker! Central banks lieing about their numbers?! The manipulation continues.

 

"Avoid the five most common gold and silver investing mistakes." Free gold and silver eBook, highly recommended. 

Thu, 12/06/2012 - 08:50 | 3038730 Disenchanted
Disenchanted's picture

 

 

Which gov't bailout did they avoid?

 

March 15 - AIG discloses that several U.S. and European banks were beneficiaries of the taxpayer bailout of the insurer and said that more than $90 billion had been paid to various banks between the September bailout and the end of the year. The banks include Goldman Sachs, Societe Generale, Deutsche Bank, Barclays, Merrill Lynch and Bank of America.

 

from: http://uk.reuters.com/article/2009/04/17/us-zurich-aig-timeline-idUKTRE5...

 

btw... Deutsche Bank/Alex Brown/Bankers Trust, lots of interesting connections...

http://www.historycommons.org/entity.jsp?entity=deutsche_bank

Wed, 12/05/2012 - 18:05 | 3037335 notbot
notbot's picture

Didn't Paul Singer touch on this?  Banks are totally opaque, even to the most sophisticated outside investors.

Wed, 12/05/2012 - 18:12 | 3037367 knukles
knukles's picture

Didn't Jimmy Savile touch my leg?

Wed, 12/05/2012 - 18:18 | 3037394 WonderDawg
WonderDawg's picture

Knuksie! How you doing my friend?

Wed, 12/05/2012 - 21:16 | 3037760 knukles
knukles's picture

Dawg!  Everything goes well.  Better than hoped, my major problems are those I seem to conjure up in my head in the middle of the night.
This time when I awaken, they prove imaginary as opposed to years ago, chasing me around the bedroom...
New awakenings... major progress.... Big Stuff with the Big Guy

Family is healthy and secure, doing well and happy in all their pursuits. Golf game took a hit, almost 4 weeks off with a wrist complication but reentry is being kind, producing a higher handicap.
Skins! 

Amazing the circus about us in life, eh?
We're blessed Dawg, blessed.  Blessed with more than a modicum of serenity to see us through.

Hope all's well with you and yours.
Best and All the Promises be Yours
In Faith,

K

 

Thu, 12/06/2012 - 01:35 | 3038317 WonderDawg
WonderDawg's picture

Glad to hear it, my friend. I can't complain, either. Nearing the end of a year long project that will hopefully produce some cash flow, but we'll see. Golf game has been sketchy but last Saturday the swing felt the way it's supposed to feel. Short game, usually my strength, wasn't helping. Damn near had a hole in one, too. Hoping to play this weekend.

We are indeed blessed. Clarity of mind is helping me navigate these choppy waters and I'm grateful.

Stay present, my brother. Squeeze life.

Wed, 12/05/2012 - 18:44 | 3037460 MachoMan
MachoMan's picture

I think that was brian peppers

Wed, 12/05/2012 - 18:14 | 3037373 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Looks like Mr Kamakazi will either be hung or sleeping with the fish soon.

Wed, 12/05/2012 - 19:38 | 3037598 LongSoupLine
LongSoupLine's picture

Or promoted as new US Treasury Secretary.

Wed, 12/05/2012 - 19:49 | 3037622 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Or playing golf with Corzine and Ken Lay soon.

Thu, 12/06/2012 - 01:45 | 3038342 IrritableBowels
IrritableBowels's picture

I think you meant "hanged." LOL

Wed, 12/05/2012 - 18:56 | 3037483 bdc63
bdc63's picture

the real BOMBSHELL here is that people actually quit their jobs over this "business as usual" event

 

 

Wed, 12/05/2012 - 20:36 | 3037728 optionsman
optionsman's picture

plus 1. if one would only start asking questions about how "research" is done everywhere in the investment management industry to support their strategies (active, enhanced, risk controlled you name it) fund managers want to pursue. the picture for everyone would get so much clearer. it is largely BS in case you have not guessed it yet....But how it ties into the comment above: well a lot of analysts in such situation(s) want to quit their jobs but they have no where to go because this environment exists everywhere with slight variations. it gets even worse- a lot of analysts would rather change their career tracks away from financial industry but they cant. why? well that is another subject altogether.

Wed, 12/05/2012 - 21:03 | 3037784 knukles
knukles's picture

Ah yes, captives of the normalcy biases, propaganda espoused and required by the CFA Institute, FAF, whomever these days (I let all my memberships lapsed some time ago.)
Institutions so captured by Ellis' Philosophy, People, Process and Performance framework, and the consultant reinforcement, a veritable shill, entrapment within a framework of an industry way over paid for negative value added, leaving no room to deviate from the narrowly proscribed self defined belief systems which prove immobile with time.  Ozymandias himself incarcerated in a desert of foible and ego.

Those who've profited handsomely in the past, remember it fondly.

 

Wed, 12/05/2012 - 21:17 | 3037806 Seer
Seer's picture

+1000!

Those whose very lives depend on the system will defend it to the death.

Very few have the balls to stand up and walk away, naked (taking nothing with them).  Everyone has been programmed to grab and then TRY to RUN.  It's quicksand, running doesn't work.

Wed, 12/05/2012 - 18:02 | 3037338 johnnymustardseed
johnnymustardseed's picture

I don't get it, As a primary dealer they line up everyday for another bailout

Wed, 12/05/2012 - 18:14 | 3037372 Robot Traders Mom
Robot Traders Mom's picture

I don't either. This may be a "bombshell" for the quacks at FT, but this is just business-as-usual reporting for ZH...

Wed, 12/05/2012 - 18:16 | 3037386 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I thought this type of info was suppossed to come out over the weekend?  Tomorrow is going to be a doozie. 

Your turn dollar bulls!

Wed, 12/05/2012 - 18:23 | 3037411 fonzannoon
fonzannoon's picture

Doozie? I think you mean a snoozie. What are they going to do? Make them retroactively get bailed out? Clawback bonuses? Can they claw back coke and hookers? They avoided getting bailed out and avoided going insolvent. That's about as good bank management as I have seen in 4 years. Bravo DB. Pay your petty fine and lets all move along.

As for that guys portfolio.....not too shabby.

It just goes on and on and on.

Wed, 12/05/2012 - 18:29 | 3037427 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Look, I know it all looks like bullshit.  That is because it is all bullshit.  But the fact of the matter is this is one more domino in a long line and as each one falls we get closer to the end. 

Watching the dominoes fall will make one dizzy, but it is fun to watch.  If you'd rather you don't have to watch.  Go join a Zen Temple and meditate on "Ohm".  We will come get you after we are done with the games.

Wed, 12/05/2012 - 18:30 | 3037430 fonzannoon
fonzannoon's picture

That is damn good advice.

Wed, 12/05/2012 - 18:48 | 3037463 SilverIsKing
SilverIsKing's picture

Chump change.

Wed, 12/05/2012 - 18:53 | 3037479 fonzannoon
fonzannoon's picture

They avoided a (german) taxpayer bailout and then actually held on and did not go belly up. Granted they lied to avoid it. But the losses were obviously not big enough to take then down.  As far as banks go it seems they almost took the moral high ground here.

 

Wed, 12/05/2012 - 19:02 | 3037499 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Lying is never taking the moral high ground.  And if they lied who knows what the losses would have done to them?  Would the ECB have been able to bail them out too?  What would that have implied for the German economy?  The only economy thought to be solvent in Europe?

And if they lied who else is lying?  What about the US banks and other creditors of DB?  What if that $12B had suffered a margin call and DB would have been corzined?  Or what if they had set in motion the same collapse as Lehman and Bear?

No one knows what would have happened but just because they lied to avoid this does not make it noble.  In fact, in the long run all of this lying will make matters much worse.

Wed, 12/05/2012 - 19:12 | 3037518 wisefool
wisefool's picture

Correct. It is like pardoning the wheel man in a bank heist. "I just drove the car"..... "Well then okay, you can go" ... "But that means I still have the loot, do I have to give it back?" ... "Ehh dont worry about it, cant you tell I am trying to get out of doing paperwork here? I need a two hour lunch today"

Wed, 12/05/2012 - 19:11 | 3037520 SilverIsKing
SilverIsKing's picture

You are correct and I don't even buy that they lied to avoid a bail out.  They obviously didn't need a bailout.  They lied because they didn't want to expose their losses and now their excuse is that they did it to avoid a bailout.

Wed, 12/05/2012 - 21:26 | 3037821 kliguy38
kliguy38's picture

Chump change for banksters. The real losses ten times that if MTM was truly allowed. They had that bitch so pumped up that it was squirting out of every orifice. Those three douchebags were going to be thrown to the wolves and jumped out of the merry go round before they had their pins pulled. NONE of this is what it seems.....so go get a MCD cheese burger and turn on some Dancing With the Stars like every other good peep

Wed, 12/05/2012 - 19:14 | 3037526 fonzannoon
fonzannoon's picture

Of course it is not taking the moral high ground and of course we will never know how it would have played out. But we know now that they did it. We also know nothing will come of it. That to me makes matters much worse. You are right  with what you said above, I need to go meditate. Please come get me when the house is on fire.

Wed, 12/05/2012 - 19:20 | 3037543 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

foz, I enjoy your posts.  I was telling another FC member so earlier today. 

When we talk about nothing coming of it....sure, their equity will go down a few percent, then up a few percent, they will be slapped on the wrist with a $500M fine, and then it will be Christmas.

Rome wasn't built in a day and neither was it destroyed in such fashion.  Everyone of this happenings is adding up.  The leverage can only increase to a certain point.  And when it goes there will be blame.  We must be educated enough to put blame where it is meant to be.  This is our destiny.

Wed, 12/05/2012 - 19:23 | 3037554 fonzannoon
fonzannoon's picture

I hear you Mr. L. You have got a lot of people stacking on here. Keep talking, we are listening.

Wed, 12/05/2012 - 20:02 | 3037655 Winston Churchill
Winston Churchill's picture

Rome wasn't  built on derivatives.

Also it took six months to communicate ,in a very limited way,across its Empire.

I don't fall in the camp of a slow debilitating collapse.This sucker will be quick,

maybe over one year max.Confidence in the system is gone.Panic is next.

We shall soon see.

Wed, 12/05/2012 - 19:06 | 3037509 illyia
illyia's picture

Mr L Hendrix, do you not wonder at the "consumer confidence" number in all of this?

I am baffled by it. Is it even possible? More and more reports of individual business owners claiming that they will shutter after the holidays so as to not traumatize their families just now. More and more disgusting stupid on the part of false leaders. Just the stupid, alone, is enough to make one sick.

Almost too much stupid to watch.

Almost.

Wed, 12/05/2012 - 19:12 | 3037524 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

We are waiting for hard news like the above, like the Greek SD, we are not looking at the BS numbers from the BLS.  We know that the reporting is false in the case of UE, we know that banks aren't reporting real numbers.  What we are waiting for is evidence of those defaults.

Yet we have to hustle while we wait.  Neo-Keynsian economics is actually doing those of us lucky enough to be able to afford silver monthly by keeping this thing going.  Our hearts should go out to those who are clueless as well as those broke and we should do what we can for them.  But at the end of the day if we can't help ourselves we can't help anyone else.

So we buy silver and keep stacking.

Wed, 12/05/2012 - 19:38 | 3037595 jomama
Wed, 12/05/2012 - 21:23 | 3037816 Seer
Seer's picture

Yup... since it's ALL about "confidence" it's becoming increasingly more laughable/unbelievable that there is the slightest shred of reason for anyone to have ANY confidence in the system.

I was thinking that LIBOR was going to be "It," though perhaps it'll be found to have big gnarled teeth stuck to one of these other big chunks.

Maybe best to view it as detonation cords torching off.  Critical mass and then BOOM!

The ONLY positive course of action is to walk away and not look back.

Wed, 12/05/2012 - 20:01 | 3037653 Urban Redneck
Urban Redneck's picture

On Sunday 9/7/08 when Freddie & Fannie were nationalized- the US financial system and by extension the global financial system would have been bankrupted that very day if the debt and equity of the GSEs had been marked to market (as a nationalization (receivership) is actually different that a bailout, for which there were no appropraited funds to back the implicit guarantee of trillions of debt at the time much less the perferred equity that banks had piled their regulatory capital and god knows what else into in a chase for yield, FASB 157 wasn't even revoked until several months later).

Then Hank went on TV and baffled them with bullshit...

http://news.bbc.co.uk/2/hi/business/7603387.stm

Then...

S&P +2.5%

DOW +2.6%

NASDAQ -0.3%

Nothing to see here, move along. 

Until all the gains were given up the next day.

Until Lehman died at less than a week later.

Wed, 12/05/2012 - 21:28 | 3037828 Seer
Seer's picture

Private debts transfered to the public domain.  Maybe they're thinking along the lines of "revolving doors?"  Slosh the debt to and fro, keeping everyone on the edge trying to figure out what's going to happen...

That which cannot continue forever won't.  Growth, and with it the world's economic system, collapses.  All this shit becomes instantly meaningless (as everyone scrambles for food).

Wed, 12/05/2012 - 21:10 | 3037797 Tango in the Blight
Tango in the Blight's picture

Where's your son these days?

Thu, 12/06/2012 - 03:38 | 3038490 smart girl
smart girl's picture

Exactly. Why let the story now? Is this the easiest way of telling everyone they are insolvent?

Wed, 12/05/2012 - 18:05 | 3037345 darteaus
darteaus's picture

It's the fault of a rogue trader!

Wed, 12/05/2012 - 18:41 | 3037451 Ness.
Ness.'s picture

They should check the 88888 (5 eights) account.

Wed, 12/05/2012 - 21:29 | 3037831 Seer
Seer's picture

Where they'll find the number is?  42?

Wed, 12/05/2012 - 18:05 | 3037347 OneTinSoldier66
OneTinSoldier66's picture

Can someone please remind me again, what's a dollar?

Wed, 12/05/2012 - 18:08 | 3037353 SpykerSpeed
SpykerSpeed's picture

It's something you need a lot of, if you don't want to go to jail.

Wed, 12/05/2012 - 18:25 | 3037417 Sweet Chicken
Sweet Chicken's picture

King?

Wed, 12/05/2012 - 18:49 | 3037467 SilverIsKing
SilverIsKing's picture

you rang?

Wed, 12/05/2012 - 18:17 | 3037395 BurningFuld
BurningFuld's picture

A dollar is defined as: Backed by the full faith and none existent credit of the USA. How could you forget?

Wed, 12/05/2012 - 21:32 | 3037838 Seer
Seer's picture

Seems like ALL the big sucker games comes down to: "only believers will be saved."  Just believe and everything will be fine.  If you're not found in the Church of Fiat praying for the almighty USD you'll be subjected to Hell!

Wed, 12/05/2012 - 18:19 | 3037396 pods
pods's picture

It is composed of 371.25 grains of fine silver.  Same as the Spanish milled dollar as it was based on.

Now, an FRN, that is a claim to a piece of our collective asses.

pods

Wed, 12/05/2012 - 18:51 | 3037470 NotApplicable
NotApplicable's picture

It's a promise to pay.

Wed, 12/05/2012 - 19:02 | 3037502 WallowaMountainMan
WallowaMountainMan's picture

 "Can someone please remind me again, what's a dollar?"

it is what a penny for your thoughts used to buy.

Wed, 12/05/2012 - 20:07 | 3037666 Winston Churchill
Winston Churchill's picture

Five shillings,mister.

Wed, 12/05/2012 - 18:06 | 3037350 Ancona
Ancona's picture

Did anyone actually think these guys were......you know......telling the truth?

I thought not.

Wed, 12/05/2012 - 18:06 | 3037352 Bay of Pigs
Bay of Pigs's picture

Deutsche Bank, the poster child of fraud and corruption.

Oh wait....I mean the SEC....

Wed, 12/05/2012 - 18:11 | 3037361 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

DB the new Lehman?  It would make sense since for whatever reason the Germans are the whipping post for the global cabal.

Wed, 12/05/2012 - 21:35 | 3037850 Seer
Seer's picture

It's the fault of the swirling devil that's named "the revolving door."

Wed, 12/05/2012 - 18:08 | 3037355 stormsailor
stormsailor's picture

and you think 3 independent whistle-blowers are going to pull the sec away from their midget tranny porn?

Wed, 12/05/2012 - 21:40 | 3037865 Seer
Seer's picture

It's their (SEC heads') JOB to ensure that their buddies/co-workers (revolving door makes it impossible to tell who one really works for) stay out of jail.

Wed, 12/05/2012 - 18:09 | 3037356 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Less assets here, no gold on reserve there....

DB looks broke as a joke!

Wed, 12/05/2012 - 18:27 | 3037421 Rainman
Rainman's picture

this is what they get for fukking around with those leveraged super senior trades...go figure what's in that basket of shit !

Wed, 12/05/2012 - 18:10 | 3037357 bank guy in Brussels
bank guy in Brussels's picture

Alfred Herrhausen, at the time head of Deutsche Bank, was killed by a car bomb in Frankfurt on 30 November 1989.

A couple of years ago, then Deutsche Bank head Josef Ackermann was asked about a possible 'debt jubilee' of haircuts to wipe out a lot of the bad debt in Europe, and Ackermann responded by 'joking' that if he came out publicly in favour of such debt write-offs, he might suffer the same fate as Herrhausen.

Even for the bankers, it is sometimes a life and death game

Rich and powerful, they yet face the question... Which is the deadlier risk

Too much corruption ... or too much 'truthiness' ?

Wed, 12/05/2012 - 18:15 | 3037378 Chupacabra-322
Chupacabra-322's picture

"Too much corruption ... or too much 'truthiness' ?

Get it right.  It's Criminal Corruption.  You're using the wrong C word.  Control the Narrative and dictate the debate.

Wed, 12/05/2012 - 19:48 | 3037621 disabledvet
disabledvet's picture

Good point though. "Who's truth? Who's facts?" At some point you rise high enough to see you're really not in charge. "The price of silence" is the most sought after premium. As an equity guy "hazarding a guess" is not just word play. I would argue shutting down critical thinking itself has consequences however. Apple Computer comes to mind. So does Hewlett Packard. Imagine the wealth preserved via a "truth and reconciliation committee." When last I checked "those are taxpayers too."

Wed, 12/05/2012 - 20:06 | 3037667 Coldfire
Coldfire's picture

OK, it's from Lyndon Larouche, but this article sets out a fascinating matrix of facts pertaining to Alfred Herrhausen's murder. Contextualizes the current coordinated moves against Deutsche Bank in New York and London by the Fed and the Bank of England.

Thu, 12/06/2012 - 00:01 | 3038209 WillyGroper
WillyGroper's picture

Interesting read on Herrhausen. What a way to go. These satanist thieves will stop at nothing. Perhaps Ackermann's jest was true words spoken. 

Thu, 12/06/2012 - 02:28 | 3038414 smart girl
smart girl's picture

After reading the article posted about Herrhausen's death by Larouche, it seems the New World Order/Government/Corporates assassinated him for wanting to end the debt spiral in Poland and give them a way out. Scary stuff.

Wed, 12/05/2012 - 18:12 | 3037362 optimator
optimator's picture

I didn't bother reading the article, I'll watch it tonight as the leading headline on the national news. (sarc.)

Wed, 12/05/2012 - 18:12 | 3037365 Chupacabra-322
Chupacabra-322's picture

The Global Economic system is built on Fraud.  As is the Criminal Political, Educational and Religious systems as well. 

Wed, 12/05/2012 - 21:47 | 3037884 Seer
Seer's picture

"Go forth and multiply."  "Growth is good (The Goal)."

Meanwhile in the equation someone missed that the earth is finite.  Reality cannot be suppressed forever, no matter how immortal one's gods are supposed to be.

"Men argue, nature acts." - Voltaire

"Whether we and our politicians know it or not, Nature is party to all our deals and decisions, and she has more votes, a longer rmemory, and a sterner sense of justice than we do." - Wendell Berry

Wed, 12/05/2012 - 18:12 | 3037366 l1b3rty
l1b3rty's picture

All right!

Let's give it to them!

Quadrillion for Deutsche Bank!

http://silvervigilante.com

Wed, 12/05/2012 - 18:12 | 3037368 optimator
optimator's picture

Who knows, if they didn't come up with their string of ETF offerings they may have really gone under.

Wed, 12/05/2012 - 18:13 | 3037369 BurningFuld
BurningFuld's picture

Wait a fucking minute. My wife is a US citizen so can I list her Canadian bank accounts (which we apparently have to report to the irs) as "blah pension account" 15k- 50k ? "blah1 pension account" 15k- 50k on her freakin' FBAR (Snoop into everyone's business around the world) form?

Wed, 12/05/2012 - 18:16 | 3037375 knukles
knukles's picture

Oh the humanity of it all
And the Deutsche Bundesbank is asking for their gold back.
Lucky if they get a burlap sack of Hitler's ashes, now.

 

 

A Billion here and a Billion there and pretty soon the bank's so fucking big that $12 Billion goes missing without notice.
Gives new meaning too big to fail.

Jesus....

Wed, 12/05/2012 - 18:20 | 3037402 Tyler Durden
Tyler Durden's picture

Actually it is the Bundesbank who asked for their gold back... 12 years ago. The "Deutsche Bank asking for their gold back" story was written by someone who apparently doesn't know there is a difference between BUBA and DB.

Wed, 12/05/2012 - 18:42 | 3037440 LawsofPhysics
LawsofPhysics's picture

How does that work exactly?  A major bank in one country formally asks for their gold back from a bank in another country and nothing happens for 12 years.   How in the fuck does a "market" even continue functioning, much less remain CONfident?  Something is amiss here.

Wed, 12/05/2012 - 18:44 | 3037461 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Maybe no one wanted to be the next Alfred Herrhausen.

Wed, 12/05/2012 - 19:01 | 3037498 Alpo for Granny
Alpo for Granny's picture

Oh...something is aMISSING alright...

Wed, 12/05/2012 - 21:55 | 3037903 Ness.
Ness.'s picture

"Oh, there's something missing alright."  

 

http://www.youtube.com/watch?v=t4qxO31AfrI

 

 

Wed, 12/05/2012 - 19:10 | 3037519 tawse57
tawse57's picture

Paperwork.

Wed, 12/05/2012 - 19:25 | 3037560 phoolish
phoolish's picture

They got some of those bonds being carried over the Alps from Italy in backpacks instead.

Wed, 12/05/2012 - 18:42 | 3037452 The Shootist
The Shootist's picture

So what does Simon from CNBC think about this? Is he going to buy the dip, or buy Goldman's take on Gold? Better ask Pisani for the real scoop...

 

^Lawsofphysics -I'm pretty sure BUBA got lots of their gold back from the LBMA. Deutsche Bank is just a stinky pile of excrement. Hope that clears it up.

Wed, 12/05/2012 - 18:43 | 3037459 LawsofPhysics
LawsofPhysics's picture

Ah, so Deutche Bank is the BofA of Germany then?

Wed, 12/05/2012 - 19:21 | 3037546 reload
reload's picture

Germany has plenty of awful banks. West LB & most of the other LB,s were the greater fool in the sub prime /CDO scam. Dresdner all but went bust and had to be taken over by Commerz bank. Commerz still have a team sifting through the detritus that Dresdndr stashed in Dublin SIV's to sidestep German banking regs.

Even Allianz would already be toast if there was price discovery mechanism left functioning in the euro sovereign bond markets.

Wed, 12/05/2012 - 20:11 | 3037676 smacker
smacker's picture

Yep, that's about it.

Wed, 12/05/2012 - 18:17 | 3037382 Bohm Squad
Bohm Squad's picture

oops

 

 

Wed, 12/05/2012 - 18:16 | 3037387 Crtrvlt
Crtrvlt's picture

time to revisit those euro tce ratios  

Wed, 12/05/2012 - 18:16 | 3037388 The trend is yo...
The trend is your friend's picture

Nothing to see here...move along

Wed, 12/05/2012 - 18:21 | 3037405 Nnthnt1
Nnthnt1's picture

http://www.nytimes.com/2009/01/04/opinion/04lewiseinhorn.html?pagewanted...

This brilliant 2009 article (David Einhorn, Michael Lewis) gets once again confirmed...

--> the argument being that watchdogs ENABLE fraud

Maybe worth a repost Tyler?

Wed, 12/05/2012 - 22:17 | 3037958 Seer
Seer's picture

"--> the argument being that watchdogs ENABLE fraud"

Not always the case.  I will not, however, argue that it isn't the tendency.  Further, such action, in-action as might be the case, is but a product of the ENTIRE system.  Power will eventually flex to fraud. Remove all "watchdogs" and Power will still be performing the same things, only we won't be told of them, nor will actions be definable as "fraud."  Did Communist Russia (USSR) use "watchdogs" to monitor anything other than people (and the personal, not business, level)?  I don't know the answer to this question.

I'm guessing that if they're really only enablers of fraud then they can in no way be identified as "watchdogs."  And, I suppose, This is the point.  Also, it's kind of hard to appear to be serious when you don't back up your stated objectives with resources.

Wed, 12/05/2012 - 18:22 | 3037407 LawsofPhysics
LawsofPhysics's picture

The paper promises might start to burn a bit hotter when these big boys start going after one another.  Wake me when the guillotine is put back in service.

Wed, 12/05/2012 - 22:20 | 3037969 Seer
Seer's picture

"The paper promises might start to burn a bit hotter when these big boys start going after one another. "

The Prisoners Dilemma.  But, will any justice appear before the collapse?

Wed, 12/05/2012 - 18:26 | 3037416 Chupacabra-322
Chupacabra-322's picture

"It appears Mr. Khuzami has done quite well while working in the private sector, undoubtedly defending his German employer from precisely the same actions he, or someone else at the SEC, may soon charge the firm was defrauding investors by. His total disclosed asset range from $2,525,000 to $11,375,000. It is also ironic that nearly half Mr. Khuzami's assets are contained in real estate, and not to mention that a substantial amount of his assets are also contained in Deutsche Bank plans as well as DB stock deferred comp."

 

Hypothetically speaking, this Khuzami guy needs to be hung upside down in public with a knife to his throat.  Hypothetically speaking of course.....

Thu, 12/06/2012 - 05:51 | 3037478 XitSam
XitSam's picture

As I understand this, Khuzami was US general counsel, did he know about a 'hide the $12 Billion scheme'? If he did, then he was/is a criminal for letting DB file fraudulent SEC documents (10k? I don't know this stuff) and had the nerve to apply for an SEC job.  If he didn't, then DB is hiding stuff from its general counsel, and is still fraud by them.  He's now working for the SEC, and even if recused on this, can influence SEC investigator's careers, the only way he can really recuse is to quit the SEC. All this affects DB share price in the crisis to gain enormous advantage over competitors. Is this right? 

Well, Deutsche Bank wil pay a $2 billion fine without admitting wrongdoing. Khuzami can keep his job. Corzine is not in jail. Nothing to see here. Oh look, Dancing With The Stars is on.

Typo fixed: never -> nerve

Wed, 12/05/2012 - 18:26 | 3037418 edmondantes
edmondantes's picture

I am shocked at these allegations of corruption, fraud and systemic collusion in relation to such a reputable and upstanding banking institution... I can scarely believe it.... don't you realise DB has all of €50bn in capital to sustain its €2.5 trillion of assets... it can't be true to suggest that a 2% decline in the value of its assets renders it insolvent... after all most of these assets are AAA rated super safe government bonds and derivative postions with excellent counterparties ....  besides Germany can easily assume DB's liabilities of say 80% of GDP ... or they could apply for unlimited OMT from the ECB...  and are you not aware that Ackermann attended the Bilderberg conference (again) this year?  No action will ever be taken against such a pillar of the international community.

Wed, 12/05/2012 - 18:26 | 3037420 LostAtSea
LostAtSea's picture

This was all very interesting until I saw the new Snorgtee brunette in the Zombie shirt.

Wed, 12/05/2012 - 18:58 | 3037489 jomama
jomama's picture

dat gap

Wed, 12/05/2012 - 18:29 | 3037425 Iam Yue2
Iam Yue2's picture

500 million fine at worst.

Wed, 12/05/2012 - 22:29 | 3037997 Jacque Itch
Jacque Itch's picture

Pulling a Corzine at best

Wed, 12/05/2012 - 18:30 | 3037429 THE DORK OF CORK
THE DORK OF CORK's picture

The euro soviet  can be seen as a series of giant wage deflation /capital export adventures.........

 They will not stop until they have destroyed all near semi rational supply lines so as to earn a wage arbitrage from their eastern plantations.

 http://www.youtube.com/watch?v=a6RM8v76hlg&list=UUjb8LRickrsucqwdGPRRm_g...

Wed, 12/05/2012 - 18:37 | 3037439 ChanceIs
ChanceIs's picture

The market always has its way.  Governments can intervene to delay the day of reckoning, but the piper will be paid.  Now wouldn't it have been simpler to just have taken our medicines back in 2007 when Iceland imploded and the worldwide rot was so obvious?  Article below from just last month.  This of course doesn't include Citi's announcement of 11K layoffs today.  Weren't the banks' profits something like 5% of S&P earnings in the '60s, while they had grown to some 30% recently.  I mean...that was justified...these glorified financial machmaking services added that much value to the economy.

 

Banks may shrink for good as layoffs near 160,000 Fri, Nov 16 2012

By Sarah White

LONDON (Reuters) - Major banks have announced some 160,000 job cuts since early last year and with more layoffs to come as the industry restructures, many will leave the shrinking sector for good as redundancies outpace new hires by roughly two-to-one.

A Reuters analysis of job cuts announced by 29 major banks showed the layoffs were much bigger in Europe than in Asia or the United States. That is a particular blow to Britain where the finance industry makes up roughly 10 percent of the economy.

The tally of nearly 160,000 job cut plans, meanwhile, is likely to be a conservative estimate as smaller banks and brokers are also cutting staff or shutting up shop, and bigger banks have not always disclosed target numbers of layoffs.

The tally also does not include reports of 6,000 job cuts to come at Commerzbank, for example, which the German group would not confirm last week.

http://www.reuters.com/article/2012/11/16/us-banks-jobs-idUSBRE8AF0DA201...

Thu, 12/06/2012 - 00:04 | 3038218 Things that go bump
Things that go bump's picture

But Kate is having a baby. 

Wed, 12/05/2012 - 18:39 | 3037446 ekm
ekm's picture

I remember I was speculating that the Primary Dealer arm of DB, Deutsche Bank Securities, could be the 1st non US primary dealer to be lehmanized.

It may actually happen.

Wed, 12/05/2012 - 19:05 | 3037507 ekm
ekm's picture

And I remember the reason now.

A couple of months ago one of the bloggers here was blown away because somebody purchase a shitload of spanish gov bonds.

I asked him to check his terminal to find out who bought it because it reminded me of MFG being forced to buy italian bonds.

 

The gentlemen very kindly replied that it was DB securities. I said: It reminds me of MFG. DB securities could be next MFG or next Lehman.

Wed, 12/05/2012 - 20:36 | 3037729 MsCreant
MsCreant's picture

I'm gonna follow this. It sounds right.

Wed, 12/05/2012 - 18:41 | 3037454 ljag
ljag's picture

@lost

I thought I told her never to wear that T in bed again. I'll have to spank that ass (again) tonight!

Wed, 12/05/2012 - 19:11 | 3037517 LostAtSea
LostAtSea's picture

too late. I already lured her in with a "Mine is too big to fail" line.

Wed, 12/05/2012 - 22:33 | 3038009 Seer
Seer's picture

Careful!  When she calls you on it you're going to have to show her it's derivatives-based!

Wed, 12/05/2012 - 18:43 | 3037457 godzila
godzila's picture

sorry but what is this all about ? As soon as banks have been allowed to value their positions as they see fit why would they use MtoM ? I hope everyone realises that most bank where (and most still are) way below capital requirements or even bankrupt if one was to MtoM their assets...

Wed, 12/05/2012 - 18:50 | 3037468 ebworthen
ebworthen's picture

Vampire squid alert!

O.K., I want the magical power to use bank and government accounting methods on my personal finances.

Wed, 12/05/2012 - 18:53 | 3037475 falak pema
falak pema's picture

 

Or actually, since every bank in the world is forced to lie, cheat and mismark its own balance sheets every single day, not least of all the European Central Bank which as of moments ago has to accepted defaulted Greek bonds as collateral, this may just be completely ignored.

After all opening this particular Pandora's Box may well reveal that not only DB but the world's entire financial system is completely and totally insolvent....

United we stand...divided we fall....How long will the cement hold...? 

With the HFs drilling holes in the Titanic ship on derivative bets to save their own necks in a dodo market...?

Count Draghi and Hellicopter Ben...tweedle dee and tweedle dum.

 

Wed, 12/05/2012 - 18:52 | 3037477 ThisIsBob
ThisIsBob's picture

"leveraged super senior trades"

Gee, who woulda thunk it?

Do NOT follow this link or you will be banned from the site!