As Europe's Dollar Shortage Intensifies, Funding Pressure Surges Most In 4 Years

Tyler Durden's picture

As the world wakes up to the fact that Deutsche Bank is not Lehman - it's massively bigger, and massively more systemic, oh and it has depositors contagion is spreading through global funding and asset markets.

DB share price just hit single-digits...

 

And the expectations of a major debt haircut soar (CoCos hit record lows)

 

With Deutsche Bank Sub CDS now at record highs (remember Senior still supressed a little via ECB buying systemically)

 

And that has crushed the European banking system... (with European bank credit risk soaring, despite the ECB's bond-buying overlay)

 

EUR FRA/OIS spreads shot up 280bps in the last 2 weeks - from record lows! (the biggest percentage surge in counterparty risk since 2011's crisis began)

2016 and 2017 euribor contract prices underperform rest of the curve as funding pressures weigh on these contracts and broader risk-off sentiment sees deferred yields edge lower.

As demand for USD liquidity explodes to 4-year highs: at a peak of -61bps, this is the highest since July 2012, the middle of the European financial crisis)

USD funding demand also seen in CHF, JPY and GBP, with 3-mo. implied yields moving 5bps, 4bps and 3.5bps lower, amid patchy liquidity, according to a London-based trader.

Which confirms that this week's massive spike in ECB Liquidity facility usage.

Was not enough.

For now the world remains mired in the first of Kubler-Ross five stages of grief - denial! Expectations of a state bailout remain far too high given the massive political problem that would ensue - read, European mutiny - should Germany bailout its banking system while Cypriot, Greek, and Italian banks have been forced to fend for themselves, confirming the widely held impressin that Europe is being run by and for Germany.

h/t @StockBoardAsset

Meanwhile:

  • DEUTSCHE BANK `MUST' MAKE IT ON ITS OWN: DIJSSELBLOEM

Next comes 'anger'... remember Monday is a bank holiday in Germany.

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Erek's picture

Look out below!!!

Mr. Kwikky's picture

The bottomless pit has a...FREE FALLING... BOTTOM.

Tom Petty & The Heartbreakers - Free Fallin' (live 2008)

Yep 2008 ain't shit...compared to this mess.

MillionDollarBonus_'s picture

More great opportunities! These banking stocks are so unbelievably undervalued, I just can't believe the market is letting investors get away with such bargains! You can buy Deutsche Bank for pennies? Wow! DB has some of the finest assets in the world, strong relationships with top institutional clients, SIFI status, and access to ECB funds. How can you go wrong buying this stock? This may even be a better opportunity than European peripheral debt in 2012!

Why America’s Identity Is Outdated And Racist

ghengis86's picture

Junk and move on. Don't waste time feeding the troll

DeadFred's picture

At least it's Friday. They never unleash any surprises on a Friday afternoon after the market closes.

Leopold B. Scotch's picture

Get me some butcher's gloves.  I'm going all in at 4:05.

MillionDollarBonus_'s picture

This is a time for investors to keep their cool, and calmly accumulate these incredibly undervalued banking stocks. Warren Buffet famously said that the time to buy is when there is blood in the streets. It would appear that this is one of those times.

Why America’s Identity Is Outdated And Racist

 

VinceFostersGhost's picture

 

 

Shot of nitrous please.....thank you!

CuttingEdge's picture

Hmmm.

In the old days a bank run was pretty easy to spot. Mass panic and excitement at branches, usual shit.

In the age of interconnectivity and online banking, a considerable amount of personal savings (the sharper knives in drawer) could be transfered out in hours and no one (outside of DB) would be any the wiser.

Interesting times.

wildbad's picture

The smart money has already left the building..the door is not wide and will not be open long.

Thos who can get out will get out then the rush will be stopped by the gummint.

It is often said that one should not believe anything until it is officially denied.  This has been denied officially several times in the last few days.  This bank is toast.

My only consolation is that my ex-frau still banks there. /sarc

Stainless Steel Rat's picture

So, will it be...

<------- Draghi
<------- Draghi

Manthong's picture

“Funding Pressure Surges Most In 4 Years”

Geez, so what anvil needs to be dropped on the head of the world to finally come to the realization that CB and Money Center bank monetary policy and process does not F’n work?

Bush Baby's picture

DJIA +100  DB + 5.92%

Always gotta laugh at ZH premature ejaculators

Fed is probably buying DB - Bama ain't letting this bitch sink or he'll lose his precious fucking Legacy.

jeff montanye's picture

Baron Rothschild, the 18th/19th century British nobleman (made baron by the emperor of austria) and member of the Rothschild banking family, is credited with saying that "The time to buy is when there's blood in the streets." He should know. Rothschild made a fortune buying in the panic that followed the Battle of Waterloo against Napoleon.

he used carrier pigeons to beat the fast boats with the news.  first, knowing he was being watched by the masses, he sold, creating a panic.  when he deemed it time, he bought.

nothing like a little non public information to give you that edge.

wildbad's picture

From the people who brought you ZIRP, than followed up with their very well received NIRP...

Now, for the first time, due to popular damand, brings you

DBURP

Deutsche Bank User Reaming Program

(note: this does not mean we won't soak the German Taxpayers too!!!)

the bridge's picture

My last pay check was $9500 working 12 hours a week online. My sisters friend has been averaging 15k for months now and she works about 20 hours a week. I can't believe how easy it was once I tried it out. This is what I do... http://tiny.cc/1yodfy

BandGap's picture

God love you MBD, you made my day.

And yes, I am outdated and racist.

Hillarys Server's picture

In this case, though, I don't think there's blood in the streets. 

It looks more like a bullet is traveling a hundred miles and hour and is two inches in front of the subject's forehead.

And after the bullet hit Lehman's forehead, Lehman flatlined at zero. No blood, the corpse was just carried away.

I don't think Buffet meant to buy shares of soon to be bankrupt companies.

If there's some creative central bank work and a zombie bank apocalypse, maybe.

Leopold B. Scotch's picture

MDB is here for humor, not trolling.  I find him reliably accurate.  It cracks me up how many people get trolled by it, though.

ghengis86's picture

Meh. The schtick gets old. It is spot on though. I think I work with his cousins.

nightwish's picture

You find him accurate? Are you high? He's attempting to be satirical. If you find his political asshattery spot on and his assessment of db accurate, put your money where your mouth is and get back to us in a few months

BurningBetty's picture

To me he sounds like some Washington White House mouthpiece, spreading lies under every article that gets posted.

Transformer's picture

Politicall asshattery?  OMG, I love it.  MDB is there to get you to comment!

pazmaker's picture

yes i know  but after awhile it gets old.

ConnectingTheDots's picture

I think you are correct here. My take is that his postings are all sarcasm.

stocker84's picture

MDB is a clown  and a waste of bandwidth.

Someone or some, on these boards, have hurt his precious little ego to the point he writes drivel and promotes a dead website with none or few hits. 

What a waste of life.

Not to mention he sits there refreshing zero hedge a thousand times a day in order to get his message early in at the top. How utterly pathetic. But that's what the stupid leftards do. They waste time and expect the hard working people to compensate then for it.

Does he pretend to be a libertarian? If so, it's a ruse so that he isn't guilty by association. 

This pos is sitting in his parents basement... Probably just his mom because he clearly never had A MAN'S influence in his life... Except that time he blew that guy, but that's another story. Anyway he sits there hitting F5 OVER AND OVER then gets a boner when a new ZH posts. 

Completely and utterly pathetic waste of life.

Transformer's picture

"MDB is a clown and a waste...."

even better!!!

medium giraffe's picture

I totally agree with you MDB.  Totally.

Bill of Rights's picture

Are you a fucken retard or something?

BandGap's picture

Even retards need love. Just sayin'.

Mr.Sono's picture

Thanks mdb, catching a falling knife is the biggest opportunity. Got it, I wish I would of bought it when it was in 20's. But it's never to late.

sleigher's picture

Yeah MDB, this is even a better opportunity than Lehman.   Jump in with both feet ok?

mary mary's picture

I really like the new flag.  I always felt it needed a little something....

BurningBetty's picture

You and your ilk are ripe for hanging.

Hillarys Server's picture

MDM is back! Missed you.

About the off-topic (personally don't mind) article you posted.

It's off topic and I don't want to write about it but it p-ssed me off so I have to write.

To those interested in DB, please make a Hillary eye jerk and bounce down to the next comment.

To me what you write in the link is completely opposite from truth. Like a pineapple upside-down cake with no pineapple.

It was very written, but I completely disagree.

I don't think the US should get rid of European heroes of the past from monuments or history textbooks.

Look at Japan. Japan has let South American immigrants come to Japan if they have even a tiny bit of Japanese heritage in the distant past.

But if that South American population in Japan grows in number should Japan ignore its thousand years of history and ignore its actual past?

And instead have textbooks filled with Mexicans and so on instead of Japanese who were actually contributing to Japan's history? Of course not.

The Mexican or Peruvian immigrants to Japan can be represented in Japanese history textbooks in direct proportion to what they accomplish, and they already are! Just like various groups in US history and monuments!

Japan shouldn't include them more just because they huddle together in small towns in the Japan countryside, can't speak proper Japanese and shoplift.

Japan shouldn't replace the thousand year old moss covered temples and shrines and monuments, or replace Miyamoto Musashi or the samurai or shogun in history books with Frito Bandito just to make them happy.

If they make a potato chip that revolutionizes Japan and the world, then they can be included in history and monuments and textbooks and a new national anthem in direct proportion to that actual contribution.

https://www.youtube.com/watch?v=FbYj7ZyqjYY

the bridge's picture

My last pay check was $9500 working 12 hours a week online. My sisters friend has been averaging 15k for months now and she works about 20 hours a week. I can't believe how easy it was once I tried it out. This is what I do... http://tiny.cc/hofdfy

CuttingEdge's picture

Has DB had the "Cramer Kiss of Death" yet?

BandGap's picture

Gartman is buying hand over fist.

Mr. Kwikky's picture

LMAO...+1000 if it was up to me;)
At least this is rising..

deKevelioc's picture

ZH headlines are reading more like King World News'.

Bay of Pigs's picture

Im wondering why DB futures are up in NY?

11.93 0.45 (3.92%)

ghengis86's picture

This is classic ZH. Getting back to basics, forget BLM sideshow shit. Moar chart porn and banker doom!

Mr. Kwikky's picture

Forgot the URL...for the Deutsche..Douche...Bank employees and associates (a lot)

https://www.youtube.com/watch?v=rqDq3eyTGck

abyssinian's picture

Is this slow train wreck? or New Jersey style smash hit? 

BandGap's picture

Gonna be slow and painful, with lots of plot twists.

The Germans have the worst bank in the world.