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Is Deutsche Bank The Next Lehman?
Looking back at the Lehman Brothers collapse of 2008, it’s amazing how quickly it all happened. In hindsight there were a few early-warning signs, but the true scale of the disaster publicly unfolded only in the final moments before it became apparent that Lehman was doomed.
First, for purposes of drawing a parallel, let’s re-cap the events of 2007-2008:
There were few early indicators of Lehman’s plight. Insiders however, were well aware: In late 2007, Goldman Sachs placed a massive proprietary bet against Lehman which would be known internally as the “Big Short”. (It’s a bet that would later profit from during the crisis).
In the summer 2007 subprime loans were beginning to perform poorly in the marketplace. By August of 2007, the commercial paper market saw liquidity evaporating quickly and funding for all types of asset-backed security was drying up.
But still — even in late 2007, there was little public indication that Lehman was circling the drain.
Probably the first public indication that things were heading downhill for Lehman wasn’t until June 9th, 2008, when Fitch Ratings cut Lehman’s rating to AA-minus, outlook negative. (ironically, 7 years to the day before S&P would cut DB)
The “negative outlook” indicates that another further downgrade is likely. In this particular case, it was the understatement of all time.
A mere 3 months later, in the course of just one week, Lehman would announce a major loss and file for bankruptcy.
And the rest is history.
Could this happen to Deutsche Bank?
First, we must state the obvious: If Deutsche Bank is the next Lehman, we will not know until events are moving at an uncontrollable and accelerating speed. The nature of all fractional-reserve banks — who are by definition bankrupt at all times – is to project an aura of stability until that illusion has already begun to implode.
By the time we are aware of a crisis – if one is in the offing — it will already be a roaring blaze by the time it is known publicly. It is by now well-established that truth is the first casualty of all banking crises. There will be little in the way of early warnings. To that end, we begin connecting the dots:
Here’s a re-cap of what’s happened at Deutsche Bank over the past 15 months:
- In April of 2014, Deutsche Bank was forced to raise an additional 1.5 Billion of Tier 1 capital to support it’s capital structure. Why?
- 1 month later in May of 2014, the scramble for liquidity continued as DB announced the selling of 8 billion euros worth of stock – at up to a 30% discount. Why again? It was a move which raised eyebrows across the financial media. The calm outward image of Deutsche Bank did not seem to reflect their rushed efforts to raise liquidity. Something was decidedly rotten behind the curtain.
- Fast forwarding to March of this year: Deutsche Bank fails the banking industry’s “stress tests” and is given a stern warning to shore up it’s capital structure.
- In April, Deutsche Bank confirms it’s agreement to a joint settlement with the US and UK regarding the manipulation of LIBOR. The bank is saddled with a massive $2.1 billion payment to the DOJ. (Still, a small fraction of their winnings from the crime).
- In May, one of Deutsche Bank’s CEOs, Anshu Jain is given an enormous amount of new authority by the board of directors. We guess that this is a “crisis move”. In times of crisis the power of the executive is often increased.
- June 5: Greece misses it’s payment to the IMF. The risk of default across all of it’s debt is now considered acute. This has massive implications for Deutsche Bank.
- June 6/7: (A Saturday/Sunday, and immediately following Greece’s missed payment to the IMF) Deutsche Bank’s two CEO’s announce their surprise departure from the company. (Just one month after Jain is given his new expanded powers). Anshu Jain will step down first at the end of June. Jürgen Fitschen will step down next May.
- June 9: S&P lowers the rating of Deutsche Bank to BBB+ Just three notches above “junk”. (Incidentally, BBB+ is even lower than Lehman’s downgrade – which preceded it’s collapse by just 3 months)
And that’s where we are now. How bad is it? We don’t know because we won’t be permitted to know. But these are not the moves of a healthy company.
Jürgen Fitschen will step down May 2016. Jain will step down at the end of this month.
How exposed is Deutsche Bank?
The trouble for Deutsche Bank is that it’s conventional retail banking operations are not a significant profit center. To maintain margins, Deutsche Bank has been forced into riskier asset classes than it’s peers.
Deutsche Bank is sitting on more than $75 Trillion in derivatives bets — an amount that is twenty times greater than German GDP. Their derivatives exposure dwarfs even JP Morgan’s exposure – by a staggering $5 trillion.
With that kind of exposure, relatively small moves can precipitate catastrophic losses. Again, we must note that Greece just missed it’s payment to the IMF – and further defaults are most certainly not beyond the realm of possibility.
Not good.
And if the dominos were not adequately stacked already, there is one final domino which perfects the setup.
Meet Tom Humphrey. He heads up Deutsche Bank’s Investment Banking operations on Wall Street.
He was also head of fixed income at Lehman.
Prior history.
History never repeats. But it does rhyme. In market terms, it tends to rhyme just about every 7 years.
* * *
For more read the Zero Hedge piece from April 2014: The Elephant In The Room: Deutsche Bank's $75 Trillion In Derivatives Is 20 Times Greater Than German GDP
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Yes it could. Douche Bank is next.
Of course, Lehman was a sacrificial goat to save Goldman. For whom or what is the Douche being sacrificed, if it is indeed a sacrifice at all?
looks more like suicide to me, here at ground level.
DB is not LEH
Greece is LEH x 100
DB is AIG
Who has a "big short" on DB?
Throw those pathetic ger- nah I said I wouldn't....
Those laws on capital controls weren't passed and debated at great length if the lawmakers didn't see this coming.
At the very least I suspect capital controls in GR and DE, FR. Possibly across the entire EZ.
"History never repeats. But it does rhyme. In market terms, it tends to rhyme just about every 7 years."
Every 7 years, you say??? Well it just so happens that's coming up in September. Read below:
7 Key Events That Are Going To Happen By The End Of Septemberhttp://endoftheamericandream.com/archives/7-key-events-that-are-going-to-happen-by-the-end-of-september
just promise us you won't try and play these events with a couple short bets...
Anyone know if that blonde is working on her laptop at home, making 7k a month?
She's a headhunter's wet dream: "There are many, many, many positions that I could put you in."
Dats sexiss......
She has a cute box.
Dirty secret that is Douche Bank. Something is dead fish in Denmark.
Could this be why there will NOT be a Grexit or Graccident?
Not because it makes economic sense, but because DB will otherwise probably collapse and additionally because Obama needs Greece for his bullying of Russia.
Hey.
Either you're a douche or a bank. How can you be both a douche and a bank at the same time.
OH!
yes its the next lehman
DB is rumored to be the Bush Bank. JosefAckerman and Daddy were into a lot of business deals together and even 9/11 was supposed to have burned a bunch of documents that would have taken DB under back in 2000.
So, if this is really a fight amongst the fallen leaders, then maybe DB is in some danger.
If the boooosh cabal is still strong, DB ain't going nowhere.
Yet.
On the other hand, they have loaded he up to the gills with Toxic Derivatives. Obviously on purpose. SUch things don't just happen.
4th Reich seems to have planned things well to confuse and defuse....
So ist das leben....
Zeees ees "notes" from all over...
https://www.youtube.com/watch?v=lk1TSBW_368
Boy, die schnell eskalierten ... Ich meine, die wirklich aus dem Ruder lief schnell.
Well, I saw it coming in 2005, and I'm just a dumbass English language teacher. Tell me what I should buy this time please?
It appears the DB co-execs resigned because of massive derivative exposure ... some of which just exploded.
A Derivatives Bomb Exploded Within The Last Two Weeks
Since you're an English teacher can you contact the author and explain the difference between its and it's? Fucking killing me here.
How much of that $75T derivative exposure is connected, directly or indirectly, to Greek debt? Genuine conflict (apart from apparent conflict) with neo-liberal Russia remains to be proven.
Society will relearn the dangers of the banking industry over the next decade. Too bad we couldn’t learn from the Great Depression counter-intuitively the result of which was only to make the banks and government stronger at the expense of everyone else.
Hopefully the next crisis will see us reigning in that power, unfortunatly history doesn't support that outcome and we will likely see continued strengthening of the govt and banks.
"Looking back at the Lehman Brothers collapse of 2008, it’s amazing how quickly it all happened"
Not fast enough for my put options to really come in the money once it was clear these clowns were toast.
Fuck off and die already you miserable bankster mouthpiece.
Fucker!
I think less of the $75T is on greek debt than is in betting that the Fed would have raised rates by now. How much of the 1.5 Quadrillion is in bets that the Fed would have raised rates prior to june 2015 - THATS THE KICKER - that alone may be enough to destroy more capital than the GDP of a major nation
Or, as Tony Soprano would say "they ain't nothin' but a bunch of degenerate gamblers".
Bob
I see derivative exposure as a room filled with hundreds of armed mouse traps, big and smal. Mouse traps jump, when released, randomly in the air on top of other mouse traps which will then release themselves and jump....etc.
1. There is no way to contain it
2. the damage is enormous
3. It will be short and explosive.
But which fucker did put these mouse traps there in the first place? Don't they think?
Interesting visual TroyO.
Of course they think...really long (millenia) and hard....
That is WHY this situation....
The imbalances existed BEFORE the Grexit.
You must understand that nothing happens by accident.
Greece is being set up...AS THE EXCUSE.
The reasons will not be exposed.
If this is not the case then why, pray tell, were two traders for Douche, last week, caught illegally trading Derivatives at Russian and London Banks?
I posted the link to that article last week.
Do you really think that we have short memories over here at Zerohedge?
Here it is again...
From REUTERS via Bix Weir...
When Deutsche Bank announced that they are "internally investigating" $6B of suspected money laundering by their clients it just looked like another run of the mill money laundering case. A big one but one that can be nestled away in the attic with paying a few fines and taking a couple write downs. But what they describe is NOT a money laundering scheme but rather a problem with their derivatives book!
Deutsche Bank Probes $6B Suspected Money Laundering
http://www.reuters.com/article/2015/06/05/us-deutschebank-russia-idUSKBN0OL24220150605
"Deutsche Bank was investigating whether its employees in Moscow may have helped launder at least a triple-digit million-euro amount of money through the purchase and sale of over-the-counter derivatives in Moscow and London."
Your downarrows do not change the truth.
So go and fuck yourself Douchemeister.
The game is OVER and it is time to CELEBRATE THE COLLAPSE OF THE FRAUDULENT AND CORRUPT SYSTEM.
Good thoughts. TPTB need an excuse and they need scapegoats, patsies and the whole nine yards. The system is cracking.
I thought last year ZH was saying China real estate was going to go bust and be the next Lehman and on a global scale. TIS even backed up the claim vociferously in 2014 even though the new TIS is not the same dude but an amateur impostor. The reason I bring this up is this claim that there's a clear idea of what the trigger is going to be has essentially been wrong ever since the actual Lehman event. The system is cracking and has been for 40 years, who's to say it can't go at least another 10? The fuckers run the show from top to bottom.
Yes BooBoo, the new TIS is a terrible replacement for th eold one. In fact, so many old handles are popping back. Some (Like Bob) sound the same.
Others have changed.
I wonder where Hephasteaus has gone. And my personal favourites Ahmeenxal (sp) and one amazingposter who served the most amazing links and wrote powerfully as well.....hmmmmm.....all good...
It's about control.
And chaos is particularly hard to control and thus typically avoided and manipulated as part of the hologram but being control freaks they think chaos is always within their control which, eventually, it is not.
And being the arsonists that they are, they are rarely burnt and thus invariably enjoy the show that much more. Because it pays in the short term and particularly in the long term for which they are prepared.
Because out of chaos they will impose their order and fulfill "their control destiny". Being the Gods of Delusion is their reality...fueled by the illusions of our ignorance and passivity.
And so the fractal unfolds....
Could this be why there will NOT be a Grexit or Graccident?
Not because it makes economic sense, but because DB will otherwise probably collapse and additionally because Obama needs Greece for his bullying of Russia.
bet explanation so far.
Fucking Classic Boris.
Where have you been?
maybe that's her phone number: 212-243-1058
Has anybody seen this yet?
SANTA ANA CALIFORNIA POLICE BUSTED ON CAMERA-
https://www.youtube.com/watch?v=JTKTfUHfeKM
Good find. That was seriously horrible to watch.
I'm waiting for a new ZH member to show up named "Mrs. Stubs."
A Santa Ana cop lives down the street from me. The only reason I know this is because he drives his black-and-white to and from work every day and parks the car in his driveway -- I would guess I live about 40 miles from Santa Ana. Pisses me off every time I see that damn car, knowing that the taxpayers are subsidizing his ride to work and back day in an day out.
And that's on top of the $100,000+ pension which he'll take as soon as he retires at age 50.
Post his address.
There is nothing illegal about doing that and only that.
Has anybody seen this yet?
SANTA ANA CALIFORNIA POLICE BUSTED ON CAMERA-
https://www.youtube.com/watch?v=JTKTfUHfeKM
Meet Tom Humphrey. He heads up Deutsche Bank’s Investment Banking operations on Wall Street.
He was also head of fixed income at Lehman.
'7' That number 7 just keeps keeping on.
Mme C Lagarde IMF CEO speech to National Press Club tested them on their numerology skills and geuss what " '7' is the magic number"
Go check it out on Utube very interestng stuff indeed.
a big short on DB, bonds or any other thing is fruitless at this point. Like Bill Holter pointed out: any of these events will end the financial world as we know it, so what good will a pile of dollars be once the house has gone up in flames?
It would make a really NICE fire.
Save wood for that, the afterwinnings will all be digital and denominated in a new currency, most likely. It will, after all, be billed as Gotta Save The World!
Hank Paulson's bullshit was just a proof of concept.
August 2013, Pettinato & ASSociates, an investigator of lost money, notified me 103 shares were sitting in Calif Unclaimed Property division in my name as Jt Tennant to my now deceased xhusband. Nearly 2 years later, and I have still not received these shares (DWS World Dividend Fund-S). Despite Probate Code Section 5604 (c) (2), they refuse to give me the funds. Yet, Pettinato and ASSocites took 10% of the shares which is ILLEGAL. I am preparing as we speak to take them to Small Claims Court. They had me running up and down the street from the courthouse to the bank for Medallion Signature Guarantee (after they found me) during which time I was notified state of Calif attempted to desposit these funds into a check account (Wells Fargo) which of course is impossible. They are DRAGGING their feet. The disrespect displayed to me (uppity) by these thieves in good jobs (like I am trying to steal this money from my husband's estate) is beyond comprehension.
Who has a "big short" on DB?
The counterparty for their derivitives?
Walkure -> Greece is the mortgage borrowers and DB is Lehman. Recall DB bought Bankers Trust a pidgeon hole for the FRB, DB will fall this time.
For those that do not know DB owns MetLife as well. DB bought Bankers Trust and their building across from WTC on Liberty. Then after 9-11 the building was demolished due to "mold".
Not quite though. DB didn't make the loans to GR. The loans are by private and public funds which have secured the loans with derivative guarantees from DB. The way I see it, DB is more of an insurer on said loans. That DB is pickled with corruption and manipulation is clear.
If it happens, someone better get the full video of Joe jumping.
JPM is the one betting on DB's demise this time. Goldman is licking it chops for the upcoming Greek default.
Analyst recommendation: Underperform
Walter- Fucking Nazis. Nothing ever changes.
Donny- They were Nazis, Dude?
Walter- Come on Donny! They were threatening castration! Are we going to split hairs here?
Well, Jurgen seems to think it is going to last another 11 months...
No, it can't. It 's not in New York, it's in Germany. The whole situation is completely different.
It's actually more of a London type bank.
My point is that Lehman Bros. was an event that was part of a legal-regulatory environment, including the Treasury Dept. etc. etc. peculiar to New York; events will not develop in Germany in any similar fashion.
Not really.
Counterparty failure turned a $10Bn net loss exposure into nearly a trillion at Lehman..
So who is on the other side of Douches derivatives ?
And just how weak are they ?
Yup, are they the German AIG.
Nobody has mentioned Kreditanstalt.
I wonder why??
The first public indication that Lehman was a goner was one I said they were done for on Thursday, 21 February 2008 05:00, reference
I also warned about Deutsche Bank as well, although that one seems to be a bit early.
+1 .. Is it ever early enough? The two CEOs jumping the ship or being "jumped" is that still an early indication? How about German officials raiding the offices and preparing the seizure? (imho)
"Here’s a re-cap of what’s happened at Deutsche Bank over the past 15 months"
Forgot to include the suicide of William Broeksmit.
People familiar with the matter say he had been involved in investigations by U.S. authorities probing the bank.
The London coroner's office, which investigates sudden or violent deaths including suicides, said Mr. Broeksmit left multiple suicide notes but didn't disclose their contents.
One of those notes was to Anshu Jain, Deutsche Bank's co-chief executive, according to a person familiar with the note. The decadeslong investment-banking careers of Messrs. Broeksmit and Jain were closely entwined, dating back to their work together in the 1990s building Merrill Lynch & Co.'s derivatives business.
The mounting pressures on Mr. Broeksmit in recent years coincided with a broadening array of investigations targeting Deutsche Bank itself, including its role financing controversial bank deals and alleged manipulation of financial benchmarks.
His most recent title was the investment bank's head of capital and risk-optimization. Among other things, he was responsible for evaluating risks related to complicated transactions.
More detail contained in WSJ article here http://www.wsj.com/articles/SB10001424052702303725404579461094290867008
how many Lehman folks were found on sidewalks and nearby rooftops?
no where near enough!!!! None in fact, please there is no longer any real risk in banking and finance!!!
Merkel's nipple were erected while on G7 meeting (seen on pictured). WHY?
Somebody has smelly fingers.
I thought that Merkel was a dude, like that Yellen guy at the Fed.
Statler and Waldorf both got re-assigned.
She was thinking about Putin in the good ol days
All of them. As you can see they were carrying their personal effects out of their offices and down the street via the sidewalks. The C-level execs all left via helicopter off the roof.
They could have just gone back to mark to model lke they did a few months later anyway in March 2009, which is when this bull market began; whereas, they had forced everyone to go to mark to market in November of 2007 (the beginnng of the recession). Coincidence?
Or, Obama's futue Treasury secretary could have decided to bailout Lehman like in every case before and after Lehman, but Bush and Paulson left it up to Geithner to decide. Coincidence?
Or, they could have not done any bailouts ever, thus saving us from the damage that is still unfolding.
Yes. This is the real truth to the 'recovery' and bull market we are in now. Mark-to-Fantasy. This will end only when the Fantasy ends....
This whole market is BS. If it went back to Mark-to-Market there would be no market.
Will we recover from the next crash, or will we be fucked for generations? I just don't know. Maybe they'll pull one more rabbit out of the hat and keep this thing going for one last stretch.
We never recovered from the last one. We just papered over the Grand Canyon of unpayable debt with more unpayable debt and declared victory.
Never happen! like the printing press spewing out currency, the media will print " hope'" to keep it going!
I'm guessing it depends a lot on whether Greece defaults and if Credit Default Swaps are triggered. That's two big 'ifs'.
I am going to keep saying it until you listen. The CDS market will be settled among the cartel and simply "disappear". Once again their debt obligations will be forgiven, yours will not.
This has happened many times throughout history, sometimes you get a world war, sometimes you don't...
same as it ever was....
I'm listening, I'm listening! I think we're in violent agreement on that point.
Can't put a corporate charter in prison.
And apparently the right bullets don't even exist.
That is the reason why they have diverted to Nail Guns?
As for Laws of Physics assertion...I disagree.
There is NOTHING SIMPLE ABOUT IT.
It will all devolve into a BLOODBATH...first amongst themselves ss THERE IS NO HONOR AMONGST THIEVES.
You will see many more "suicides" and gangland killings.
This will be followed by Political Assassinations.
Afterwards we will get a World War...as happened so many times, too many times, in the past.
(Oh i know that they were not called World Wars back then. But when an Atilla the Hun stretches his forces from Mongolia deep into Europe, or, when an Alexander the Great conquers most of the cradle of civilization, or,when Napoleon take over Europe and invades deep into Russia, they were Global in respect to civilized societies.)
Yes the CDS obligations will disappear...ALONG WITH THE FAITH, TRUST, and CONFIDENCE of the oligarchy in this CORRUPTION, this Ponzi Game paradigm in which we all play a role.
Then the elitist survivors, after seeing the violent bloody end of their fellow thugs, will make a deal and begin anew, fleecing the muppet classes, whom are the survivors of the Nuclear Holocaust which precedes the deal.
And the muppets will surrender their Liberty and serve as serfs to the new Lords in the paradigm of the oncoming Neofeudal Age...for safety and protection.
Simply disappear??? No.
Laws of Physics, You are fucking dreaming...
No Laws of Physics. There is nothing simple about it. Nothing. Nothing at all.
Yes it will be settled, violently, as most conflicts and disputes between uncivilized, barbaric criminals are settled.
They are MONSTERS and it would be unwise to forget that little fact and get stoned on the hopium...like you have been, Laws of Physics.
To sum it up succinctly...
We are totally fucked...all of us. And we deserve it.
This makes sense. Remember last time this happened the banks sold huge lots of mortages for pennies on the dollar. Someone's $300,000 mortgage was sold to another bankster for lets say 10 cents on the dollar or $30,000. However, the middle class homeowner was never notified nor given the chance to buy out their mortgage for pennies on the dollar. Their debt obligation for that mortgage remained at $300,000.
Why would you expect anything different this time?
yep - the money changers make the rules that they need when they need them
They may very well change the rules to try and ignore reality, but you don't just vaporize a market as big as the OTC derivatives market without unintended consequences that result from ignoring reality. WWIII, should it remain conventional, will break supply chains. Should it not remain conventional, it might actually be over by Christmas for once in history. Or it could be a mass of internal revolts, which will break supply chains. But $75 trillion is an awful lot of promises to break, and that's just one bank.
I tend to agree. While I am cynically sympathetic to LawsofPhysics' perspective, I don't believe that such massive, and complicate debts can be "forgiven" without serious consequences.
I'm not so sure that he doesn't think that it wouldn't have serious repercussions. His "Sometimes you get a war, sometimes you don't" acknowledges this.
He is smoking the hopium.
You will get a war...That is the pattern.
Revolutionary Age Nations at the beginning of the 19th Century were at constant war before Pax Brittania.
The revolutions were followed by the economic upheaval caused by the birth of the Enlightenment and the very beginnings of the Industrial Age.
War is ALWAYS an Economic Event. The excuses are varied but the reason is to expand economies.
War is Government Sanctioned stealing, murder, and mayhem.
Nothing has changed...not one damned thing. Human beings are fucked up and doomed to extinction. It is just a matter of time at this point.
We'll make great pets.
Or Perhaps better:
War is Government Sanctioned Corporate stealing, murder, and mayhem.
I concur,
It's not debt, it's exposure, and few know what sort of shape it's in.
The solution is simple: Those who will not accept or grant Forgiveness, will first be made an "Offer they can't refuse".
If they persist, the consequences will be... Severe.
im with you. i dont pretend to be an expert on the derivatives market, but i would guess it's orders of magnitude more complex and interwoven than the MBS markets in 08, which means that everyone, from TBTJ banks down to local firemen pension funds, have exposure to these ridiculous paper promises on paper promises. banks are still slowly releasing their shadow housing inventory on the market and almost 7 years on people in the RE market are still having problems understanding who owns what and who owes what to whom. the idea that a debt jubilee amongst the major derivatives players would be an easy way to wipe the slate clean ignores the infinite complexities of the CDS derivatives market.
IMO, it is complex enough that, at the very least, you'd have to do a jubilee on the entire OTC derivatives market all at once for there to even be a shot at pulling it off. Not just Douche Bank, but everybody, world wide, and at the same time. The question is, how many greedy fucks would get in the way of that, because they want to get theirs and fuck the rest of the system?
All of them...
Exactly. BLOODBATH.
There is nothing simple about this.
Well, I always try to simplify to get some level of understanding, even when the subject is complex. Here is my simple model:
Derivatives are considered assets by various holders - banks, etc. When customers, rich and middle alike, look at their assets, they see a number like a bank balance or a brokerage balance. Summing up, there are vast numbers of people around who believe they have wealth in the form of money. Let's say the total of what everyone believes they have is X.
The problem is that X is not closely - or even remotely - related to actual wealth, which would include real estate, productive businesses, etc. You can estimate the percentage of X that is actually represented by real wealth in various ways. But for arguments sake, let's say that the actual amount of real, tangible and usable wealth is 1% of X (this is wildly optimistic - the real number is probably much less).
If the system collapses, it means that that 1% of X, which is actual, real wealth, is somehow divided up among the people who believe that they own, among them, X of wealth. If there are 100 people in total and all of the real wealth goes to one person, it means that person gets all they thought they had. It also means that 99 people get nothing. Their supposed assets vanish.
Only a few questions are worth thinking about in this simple frame of mind:
1. How will the 1% of X be divided among the people who think they own a total of X?
2. How will society function if the medium of exchange seriously breaks down, either partially or completely?
3. How can one manage to survive such a breakdown?
The key point is simply that X money has the illusion of existence, while X amount of wealth does not exist. The game of musical chairs is the simple analogy. At the moment, we are playing the standard game where one chair is removed at a time (MF Global, etc). The system has withstood this so far and more or less continues to function. The worry is that the game will accelerate with many or most chairs removed suddenly, or when the system collapses.
I guess that I am more of an optimist than you. (Me...An optimist? Well I guess that there are degrees...)
I believe the leverage to be 15 to 1.
Here is my reasoning...
There are $1.5 Quadrillon or $1500 Trillion in Derivatives,
Total World tangible assets are priced in at roughly $100 Trillion.
Divide.
How is that for simplicity?
Here is another simple way of looking at it...
It took roughly 10.000 years to produce $100 Trillion worth of goods.
If analyzed in a linear progression then it follows that it would take another 140,000 years to equalize tanguble assets with the current existing Derivarives.
Now I do understand that World Production with respect to Time is not a linear function but it has been exponential.
And I also understand that in any adiabatic system that exponential growth leads to exponential collapse.
But my linear progrssion model is simple and it gets the point across that this cannot ever be balanced out.
And here is another simple way of looking at it...
There are FOURTEEN OTHER CLAIMS against every single item that you believe that you own...on average.
But that is enough about simplocity...
Because in truth the unwind is going to be anything other than simple. And if you believe otherwise then you are smoking some good hopium.
Is that simple enough for you?
It's called a global financial and monetary reset via a new global digital currency, imho. What else could meet such a challenge in status quo terms . . . and what better pretext for a planetary transnational corporate dictatorship?
The final glorious two'fer.
Orwell, 1984
"$75 trillion is an awful lot of promises to break, and that's just one bank."
Oh, I'm sure they have some good bets in the stack;)
Until a couple of counter parties find that they can't make good on those bets.
They hired the doosh from Lehman, FUBAR!
He has relevant experience.
Douche Bank hired a douche. Are you surprised?
Seems too obvious... then again maybe that's the power of the cycle.
Long cardboard banker boxes.
My whore refuses to carry boxes. WTF?
Fap material right there. FYI I do believe this is her https://thrivewire.com/stories/hunting-for-food-and-making-a-watermelon-keg-this-womans-a-modern-pioneer
You ain't lyin'!! Fap fap fap fap fap fap fap...
www.truthinaccounting.org
DB is so fucked.
We can only hope
ZH Headline: Deutsche Bank The Worst Lehman Since Lehman
Are there 'comment' algorithms that can be posted should the story require such a response, to manipulate. Or am I just paranoid?.
Never knew Michelle Obaba wore glasses.
WTF is Christophjer LLoyd doing there? Lottta questions.
Ok, that might be a racist remark
Let me check with the judges....
No! Wow, surprisingly the judges say no, that is not a racist remark. A very unexpected and controversial call by the judges on this one.
Y'all have just offended every Wookie in the galaxy.
If Wild Bill gets any more truthy,
we'll all get to see the FEMA camps.
GO FOR IT, WILLIAM!
Nope....we're all just anti-"Ugly-Ite".
The suit makes the ape...
Yep, it's just coincidence that people started calling Mrs Obama a monkey. Nothing to do with her race.
Christopher LLoyd is one of the good ones.
not racist. it may be specist but that bitch looks like a sasqwatch
She's a wookie man, everyone knows this.
It is a racist remark.
You're a Douchebag. Is that a race?
Actually, it's not a 'racist' remark but a 'species-ist' remark.
You either need new glasses, or to stick to topics within your ability to process -- given that anything with a racially suggestive tone causes a preprogrammed conditioned response in you.
And the next time you go home, don't be surprised if your wife asks you: "Ska jag ta dig bokifran?" Got Astroglide?
That is Michelle in her Trans-Wookie state.
That ape could consume his marijuana.
The difference is Lehman was iffy and everybody knew it and the other mega-banks easily threw them under the bus to save themselves. DB is a major pillar in the Euro system and if they go down it'll likely collapse the EU. I expect "extraordinary" measures and a major ass covering for this little passion play....
nothing that a little money printing can't fix
when you have a money printer, EVERYTHING is possible
So you turn make believe fiat into real fiat - what's the difference?
The number of can kicks. I'm not going to say which strategy would be best, but I will say that the banks like the make believe fiat option if their recent actions are anything to go by.
This new money will only be used to make derviative holders whole. It will not be used for other purposes.
They have applied specifically created money to save the banks before. And in their eye, it has worked before!!!!
They feel it never reached the real economy, just the bankster ratios..
As long as the bread is delivered in sufficient quantities and on time, the circus will go on. When the bread stops everything stops.
So I'm assuming someone in NY/DC is calling someone in Berlin and saying look, if you forget about this Russia/China thing, we can help you with your DB problems.
too many German industrialists on the other side of that argument. I'm sure a lot of them would chuckle to see DB go down.
"Peanuts" said Hilmar Kopper..........
Leo Kirsch must be looking down on DB
Yes - exactly. Lehman went belly-up because it wasn't protected by the Fed. DB is the definition of TBTF for Europe. Now that the "free-world" is facist it is political capital that counts.
Yep, Germany will nationalise DB before they let it go under the bus.
DB is Lehman on steroids.....Lehman did not have the massive amount of derivatives which DB has managed to foist onto the market.
The counter party risks from these derivatives is going to reach into every bank in every country.
Lehman was just TNT.........DB is nuclear.
The cross default losses will collapse the whole system. Offsetting trades have one side completely wiped out.
Short answer: yes.
Derivatives goeth before the fall.
I hope so.
The whole "since Lehman" meme is getting worn out.
There are others equally bad...
We _______-ed some folks.
History doesn't repeat, but it rhymes.
Tom Humphrey - LOLOLOL you can't make this shit up
Short USD and long crude at 50x not so much fun anymore?
Indeed......