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Deutsche Bank Charts a Danger Map For A Crisis Prone And Credit Troubled World

Tyler Durden's picture


Against a background of 30%-plus falls in bank share prices around the world and growing fears of a severe blow to the European bank sector in the event of a sovereign debt default, Deutsche Bank has produced a lengthy tome that answers 'everything you wanted to know about the global banking sector but were afraid to ask'. A compendium of charts and tables, summarized effectively by 'Danger Maps' designed to highlight countries which face greater (or lesser) stresses for their banking systems is further extended into a country-by-country breakdown for developed and emerging markets. While their findings may not line up perfectly with our more global contagion perspective, they do create a systematic framework for judging relative investment opportunities that sees Japan, Australia, Hong Kong, and the Nordics as the least risky; US and UK about average on macro scores; while unsurprisingly (with the exception of Germany) the Eurozone countries have the highest danger scores. Transmission channels are discussed and they make a critical point on bank valuations that earnings estimates are extremely sensitive now to bad debt charges and credit quality assumptions.


While using prior crises as a basis for projection may be a faulty premise, the Deutsche team has done a good job of outlining how key drivers, factors, themes will impact/create winners and losers.


And the Danger Maps (for both developed and emerging nations) are as follows - higher number indicates more risk - which in turn is factored into their name-by-name modeling of financials.


The full document is below but the more focused Credit Strategy article this week indicates Deutsche's view (which remains similar to ours) from a trading perspective, that:

The primary market shutdown has meant that banks are not able to fund long term and given the refinancing needs for Q4 2011 (c.€183 bn) and the next 3 years (€1.5 trn until 2013) we expect term funding to remain stressed unless markets reopen and function normally. And the consequence of this challenge could be deleveraging by banks which is a negative for economic growth. We highlight the redemption schedule on a month by month basis and by security type along with the banks with the biggest redemptions inside the article.


The lack of long term funding has also put the focus on short term liquidity and the stress in the European interbank markets is now inching towards levels last seen at the start of the credit crisis – and this is despite banks actively using the ECB window to fund themselves. Active deposit seeking is a solution that banks could pursue in the mean time to alleviate this funding situation.


Given the recent stock slump and the slowdown in the economy, there are questions about how well capitalised banks are, to withstand any actual losses. The sovereign crisis is in the backdrop and if not contained could cause further losses on balance sheet for banks. This could further impair capital ratios which are already stressed. Given European bank exposures to peripherals, the loss absorbing ability of European banks will continue to remain in focus and we believe the possibility of a recapitalisation wave in case of a sovereign event is very high. The IMF has mentioned a €200bn shortfall and our equity research colleagues estimate €100bn required capital injection to withstand a sovereign event. In this situation, a European version of the TARP is not a far-fetched idea.


Overall, we believe that, although financials spreads have widened significantly and look cheap quantitatively, banks face systemic issues which could keep spreads elevated unless there is a systemic resolution from the authorities.


DB_Global Banking in a Del Ever Aging World


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Sun, 09/25/2011 - 23:32 | 1709317 RobotTrader
RobotTrader's picture

Platinum getting totally destroyed.

The big story this week is probably going to be the further decimation of industrial metals prices.

Sun, 09/25/2011 - 23:47 | 1709341 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Robot, you are still alive. I guess throwing a few jabs at the PM worshipers after they talked all that trash about you.

Sun, 09/25/2011 - 23:57 | 1709385 Ahmeexnal
Ahmeexnal's picture

Rhodium seems to be immune to the meltdown.

Ag is falling to 28.  Hope it goes to 20 so I can load up with both hands.

Mon, 09/26/2011 - 00:15 | 1709420 Sudden Debt
Sudden Debt's picture

I just read a piece showing the probabilty of silver going down 50% and it made sense now banks and funds are selling the furniture.

At 20 euro per ounce, I'm buying at 15 euro per ounce I'm taking on a loan to buy more :)


Mon, 09/26/2011 - 00:20 | 1709433 Id fight Gandhi
Id fight Gandhi's picture

Silver moving multiple standard deviations over several trading sessions does mean down. Which is why you need to be hedged or short the markets if u want to pocket any profit. PMs will soar on money printing, but who knows when that will happen.

I'd be buying more eagles around 25-27 but already have more than enough silver much much lower.

Mon, 09/26/2011 - 00:30 | 1709455 Cliff Claven Cheers
Cliff Claven Cheers's picture

Can anyone explain why gold and silver have dropped so much?

Mon, 09/26/2011 - 01:11 | 1709507 Ahmeexnal
Ahmeexnal's picture

Someone leaked the margin hikes to be announced tomorrow.

Mon, 09/26/2011 - 01:13 | 1709509 Cliff Claven Cheers
Cliff Claven Cheers's picture

Thanks for the reply.


Real classy junking a question. I love these drive by junks who don't have anything to contribute.

Mon, 09/26/2011 - 02:02 | 1709602 Mauibrad
Mauibrad's picture

Neat Charts.

Mon, 09/26/2011 - 01:26 | 1709527 Western
Western's picture

This is a good place to start;

Put some effort into it next time.

Mon, 09/26/2011 - 01:29 | 1709537 MisterMousePotato
MisterMousePotato's picture

I think it's a combination of factors - a Perfect Storm kinda thing:

As the global financial crisis gathers momentum, why has gold dropped 15 percent since reaching a record $1,923.70 an ounce on September 6? Also, silver has plunged the most since October 1979. In two days, gold dropped 9.3 percent, the most since February 1983. The weekly decline of 9.6 percent was also the most in nearly three decades.

These are the possible fundamental causes for the accelerating decline in the price of gold:

1. Exchange Traded Funds (ETFs)

The UBS rogue trader, who caused the chief executive of UBS -- Oswald Gr?bel -- to lose his job over the $2bn black-hole, has accidentally highlighted the problem with ETFs. As the recent ATCA briefing, "Are The $1.4 Trillion ETFs The New WMDs? Anatomy Of The Highly Toxic UBS Scandal" points out:

"Think of all the gold ETFs and then ask yourself: How much physical gold actually underpins the gold ETFs? Answer: Not a lot! As much as half of the trades in gold are now driven by ETFs, while some blame them for speculatively driving up [commodity] prices."

Top gold sources say that some ETFs are involved in fractional selling in ratios of 1:100 and there is only 1 kilo of gold for every 100 kilos of gold-equivalent ETF units which are sold and re-sold. As queries for physical gold repatriation start, gold funds and myriad financial institutions and shadow banking vehicles -- such as prominent hedge funds -- may keel over?

Attention is just beginning to gather on the accounting principles of the popular but tainted gold and silver Exchange Traded Funds (ETFs). The gold inventory is under scrutiny for usage in COMEX -- Commodity Exchange -- deliveries, enabled by questionable shorts to the GLD and SLV shares by its own custodians. The Bar Lists are regularly seen as erroneous and suspicious.

The biggest gold and silver funds are now on the defensive, as they may soon face mass investor exits on the back of heavy discounts to the precious metal spot prices and doubts about the levels of physical gold they actually hold.

2. Paying for Losses and Booking Profits

There is clear evidence that investors are selling gold to pay for massive losses in other asset classes like equities and commodities. In parallel, many investors have made a solid profit in their gold-linked investments. As the markets crash and there is a need to find ready cash and report profits, it is easier to do so by selling their hitherto profitable gold positions.

3. Source of Liquidity and Margin Calls

Gold has become the source of liquidity for global margin calls. It is difficult to say at what level this liquidation will stop. COMEX -- Commodity Exchange -- is making it more expensive for speculators to trade. CME -- Chicago Mercantile Exchange -- Group has increased the margin requirements on gold and silver. The minimum cash deposit for gold futures will rise 21 per cent to $11,475 per 100-ounce contract in the speculative Tier 1 category at the close of trading on September 26, Chicago-based CME has said. For silver, the minimum cash deposit has been raised to $24,975 from $21,600.

4. Flight to Cash

We are seeing a flight from illiquidity to liquidity, ie, from all asset classes -- including precious metals -- to cash because 2008 is still very fresh in people?s minds. In October 2008, gold prices tumbled 18 percent as the most-severe slump since the Great Depression spurred losses in global equity and commodity markets. However, the yellow metal jumped 23 percent in the next two months.

5. Too Fast Too Soon

The summer run-up in the gold price was too far too fast and too soon as institutional speculators extended their long positions in paper derivative markets. All these tell-tale signatures suggested a big fall at some stage, which has now arrived. Rather than any dramatic reversal in world physical markets, it looks like gold's precipitous price decline in recent days and weeks can be attributed at some level to the same set of speculators -- including some prominent hedge funds and the trading desks of the big Wall Street, European and Asian banks -- reversing their positions or cashing out of gold altogether.

6. Deflation and Commodities

Slowing world growth has created pressure on gold and commodities from the deflation angle. The broad slide in commodity markets also helped drag gold lower, as declines in the commodity indices prompted managers to liquidate gold.


The fall in the price of gold at a time of increased global uncertainty can be counter-intuitive for some investors to understand. Of all the reasons cited for the accelerated decline in the price of gold, knowledgeable senior executives -- with board level responsibilities in gold mining and gold bullion trading -- suspect that worries about Exchange Traded Funds (ETFs) and investors pulling out of their leveraged gold positions are amongst the most likely suspects. The increased margin requirements may still be a minor contribution but would likely cause a further modest dampening of sentiment.

Is this a short-term or long-term correction? Could the correction in gold prices be short-term and similar to initial losses suffered in 2008 or is this a more long-term correction like the one in the early 1980s that lasted for more than two decades? The length of the fall in gold prices depends perhaps on how long will it take for the ETF situation to normalise!

Some senior executives from the gold industry feel that the long-term upward trend in the price of gold is likely to continue because physical supply from new production is very limited and the overhang from central banks pretty securely locked-in for the moment. This leaves open the question that how long will the transition period of falling gold prices be before the long-term trend resumes?

Having said (plagiarized) all that, it is my belief that most of the drop on Friday was the result of the in-the-club knowledge of margin hikes (why, oh why, will no one give me a badge and a gun?). None of this affects the long-term fundamentals, though, in any way that I can see (have to agree with that douche Deninger about this), and at some point in the future (a week? a month? a year?), those who didn't will be kicking themselves for not buying silver at $40. I, for one, will not ignore the opportunity hereby bestowed; viz., sale on silver, two for the price of one. Yay. Guess the Valiuminun scriptins are starting to wear off.

Mon, 09/26/2011 - 01:40 | 1709554 Cliff Claven Cheers
Cliff Claven Cheers's picture

Thank you Mister that was very informative.

Mon, 09/26/2011 - 00:06 | 1709400 I think I need ...
I think I need to buy a gun's picture

the fire has started paper and kindling have already started....all we are waiting on is the main logs very soon

Sun, 09/25/2011 - 23:51 | 1709347 Caviar Emptor
Caviar Emptor's picture

The big story this week is probably going to be the further decimation of industrial metals prices.

LOL. That ain't the only thing to be decimated. Keep your eyes wide open. 

Sun, 09/25/2011 - 23:55 | 1709366 bob_dabolina
bob_dabolina's picture

Silver -3% as well

Mon, 09/26/2011 - 00:13 | 1709414 DormRoom
DormRoom's picture

if you are in a leveraged gold or silver ETF, get the fuck out.  You can get wiped out, if you hold an ETF, when the underlying asset is falling sharply.  You get wiped out, but the ETF consolidates shares, so it can continue to fall.

Mon, 09/26/2011 - 01:00 | 1709492 scatterbrains
scatterbrains's picture

unless it's ZSL or DZZ for the time being anyway, but true.. I feel for anyone trapped in these 3x long funds praying for a bounce. Seriously it's getting ugly.

Mon, 09/26/2011 - 00:13 | 1709418 I think I need ...
I think I need to buy a gun's picture

yep we saw this movie before in 2008 when the slv dropped below 10 maybe 5...but could you get a coin for 5 dollars. Pretty soon your silver will be priced in gold terms along with oil.........the paper its the paper....everything paper is on fire

Mon, 09/26/2011 - 00:33 | 1709462 Cliff Claven Cheers
Cliff Claven Cheers's picture

BTW where is Mako, it only costs $5.00 to dig silver out of the ground.

Sun, 09/25/2011 - 23:57 | 1709386 jomama
jomama's picture

considering a 30%+ drop in the last 72 trading hours can't be a real move, how low can it go?

Mon, 09/26/2011 - 00:09 | 1709407 bob_dabolina
bob_dabolina's picture

It can be a real move and it is a real move. 

You can lead a horse to water... 

Mon, 09/26/2011 - 00:23 | 1709425 jomama
jomama's picture

i'm sure the price fluctuation is based on real supply and demand.

go be an asshole somewhere else.  i wasn't even fucking talking to you.  

oh, and uprating your own posts is pretty pathetic.

Mon, 09/26/2011 - 01:05 | 1709500 scatterbrains
scatterbrains's picture

This fluctuation is based on the hope now dashed that the Bernank would print along with twist. Now it's a game of chicken.. will he print ? How soon? He has to print! or does he ? meanwhile pm's are getting slaughtered... this is bad.


Mon, 09/26/2011 - 01:29 | 1709535 Western
Western's picture

JPM setting loose a couple of destructo-algorithms at midnight and CME raising margins in concert is considered a real move (in terms of Ag price)?


Mon, 09/26/2011 - 00:11 | 1709412 SGS
SGS's picture


Mon, 09/26/2011 - 00:10 | 1709409 DormRoom
DormRoom's picture

Bernanke was right.  The increase in commodity prices was transitory. lmao.

Mon, 09/26/2011 - 01:52 | 1709573 Hearst
Hearst's picture

President Lyndon Johnson on July 23, 1965

“Now, all of you know these changes are necessary for a very simple reason–silver is a scarce material. Our uses of silver are growing as our population and our economy grows. The hard fact is that silver consumption is now more than double new silver production each year. So, in the face of this worldwide shortage of silver, and our rapidly growing need for coins, the only really prudent course was to reduce our dependence upon silver for making our coins.

If we had not done so, we would have risked chronic coin shortages in the very near future.

Some have asked whether our silver coins will disappear. The answer is very definitely-no.

Our present silver coins won’t disappear and they won’t even become rarities. We estimate that there are now 12 billion–I repeat, more than 12 billion silver dimes and quarters and half dollars that are now outstanding. We will make another billion before we halt production. And they will be used side-by-side with our new coins.

Since the life of a silver coin is about 25 years, we expect our traditional silver coins to be with us in large numbers for a long, long time.

If anybody has any idea of hoarding our silver coins, let me say this. Treasury has a lot of silver on hand, and it can be, and it will be used to keep the price of silver in line with its value in our present silver coin. There will be no profit in holding them out of circulation for the value of their silver content.”

Sun, 09/25/2011 - 23:35 | 1709322 spekulatn
spekulatn's picture

Outstanding post, Tyler.

Sun, 09/25/2011 - 23:38 | 1709325 Steroid
Steroid's picture

So many pages from a soon to be bailed out -again- bank.

The main question is credibility, DB's

Sun, 09/25/2011 - 23:38 | 1709328 Absalon
Absalon's picture

The report seems to leave out Canada even though its banking system is larger than that of some of the countries covered.

Sun, 09/25/2011 - 23:52 | 1709351 LeonardoFibonacci
LeonardoFibonacci's picture

For some reason the canadian banks seem to weasel their way out of world turmoil.  Can anyone please help me understand why canada always gets away with their banking system?

Mon, 09/26/2011 - 00:08 | 1709406 Let them eat iPads
Let them eat iPads's picture

Backstopped by taxpayers, particularly mortgages.

Mon, 09/26/2011 - 00:12 | 1709415 SGS
SGS's picture

We had banks fail in the ealry 90's.  Always...? always what? ONCE in 2008.  Fuck sake.

Mon, 09/26/2011 - 02:58 | 1709763 Dugald
Dugald's picture


Its a Snow Job?????

Sun, 09/25/2011 - 23:41 | 1709332 RobotTrader
RobotTrader's picture

New high for the move in the U.S. dollar, wow....

Sun, 09/25/2011 - 23:44 | 1709335 High Plains Drifter
High Plains Drifter's picture

do you find any of this kind of fishy considering the shape of the world financial system , there robo?   with these moves in the metals, i have to say something bad this way comes....

Mon, 09/26/2011 - 00:25 | 1709442 kito
kito's picture

Cant mess with robo, hes the master of pointing out the obvious. Just the other day he gloated that the sun rose. And when dusk came, he was quick to point that out as well. Hes a real sharp one....

Mon, 09/26/2011 - 01:22 | 1709522 Ahmeexnal
Ahmeexnal's picture

Kito, how is real estate in Salinas?  Can't figure out what Ecuador will do when the USD crashes. Aren't there any sucre backup plans?

Mon, 09/26/2011 - 00:26 | 1709444 Al Huxley
Al Huxley's picture

As you pointed out previously, what happens overnight is irrelevant. That's true for stock futures, metals prices and currencies. Whether people here like it or not, for now the sun still rises and sets on NY time.

Sun, 09/25/2011 - 23:44 | 1709337 Caviar Emptor
Caviar Emptor's picture

Asia stock markets gloomy tonight...again. 

Flash: Nikkei below tsunami lows


Sun, 09/25/2011 - 23:49 | 1709343 medicalstudent
medicalstudent's picture

silvers gonna humdrum down to 23 ish and mosey throughout the 20s-low30s for a couple months before skyrocketing in a flash of lightining to 100.



Sun, 09/25/2011 - 23:54 | 1709363 zorba THE GREEK
zorba THE GREEK's picture

I haven't used leverage in ten + years, but if silver goes down to anywhere

near $20, I am going in big on a levered silver trade. 

Mon, 09/26/2011 - 00:19 | 1709429 scatterbrains
scatterbrains's picture

The only thing is if the political winds change and the keynsians are thrown out on there ass's we could see $6 dollar silver or less come  the deflationary destruction it will bring.. just saying.  Anyone that buys silver believes in the Bernank.  I'm not so sure.

Mon, 09/26/2011 - 00:30 | 1709456 kito
kito's picture

Scatter--that change is already upon us. They cant even get funding for irene victims. No money to be spent in congress. Ben left the ship, and its mutiny on the deck. Keynesians are walking the plank. Pms, and everything except cash, are shark bait.

Mon, 09/26/2011 - 00:40 | 1709472 scatterbrains
scatterbrains's picture

They sure are culling the herd tonight though wow! Lots of peeps trapped looking for a bounce are going to get blown out it looks like.

Sun, 09/25/2011 - 23:59 | 1709388 X.inf.capt
X.inf.capt's picture

ill stop lurkin to comment on this one,

did you say $23 on silver....if you did, im having another garage sale next weekend like i did today, hell, my woman would sell her furiture at it to buy at $23.

how in the hell can they justify silver at anything lower than $50. anything lower than that is a fire sale.


Mon, 09/26/2011 - 00:27 | 1709445 Shirley Wilfahrt
Shirley Wilfahrt's picture

I was buying at $8....I was buying at $42.....I bought more at $30....




Mon, 09/26/2011 - 01:15 | 1709463 Cliff Claven Cheers
Cliff Claven Cheers's picture

Fart, nice to see you again. That pic cracks me up every time. Is that you or a friend of yours?

Mon, 09/26/2011 - 01:15 | 1709513 medicalstudent
medicalstudent's picture

agreed, as the white metal is invaluable.


the current prices will soon be seen as so unjustified that the end result will be most people will never hold a silver coin, as it will go untouchable and immeasurably valuable.


but for now, and for most of this year most likely, the silver window will remain open so long as post office trucks deliver the fucking mail.


after that, stock up on quinoa.


the apocalyptometer (the silver price) will have risen to painfully high levels.



Mon, 09/26/2011 - 03:01 | 1709774 Dugald
Dugald's picture

Sure hope to christ I neve need you for medical advise......

Sun, 09/25/2011 - 23:51 | 1709346 chump666
chump666's picture

+ housing bubbles/busts in Australia and Canada, will absolutely devastate those bank balance sheets

Sun, 09/25/2011 - 23:53 | 1709353 Caviar Emptor
Caviar Emptor's picture

Huge funding gaps, giant credit holes....perfect time for the global economy to be double dipping. 

Sun, 09/25/2011 - 23:57 | 1709387 seek
seek's picture

Wow, gold and silver both have certainly had a wierd open. Get your hopes up, then whoosh.

Mon, 09/26/2011 - 00:21 | 1709426 tyler
tyler's picture

The lower the price goes the closer we get to a massive shortage.  A few years down the road comes extinction.  As much as all of us know how rigged the paper market is, we have to ask ourselves is the paper price relevant?  Fuck no.  I hope silver goes to zero and we can get this ball moving.

Mon, 09/26/2011 - 00:06 | 1709402 Wannabee
Wannabee's picture

It's an outrage! Those horrible HIGH TAX RATE SOCIALISTS nations; Finland nor Norway, on the danger map. /sarc

Mon, 09/26/2011 - 00:10 | 1709410 Sophist Economicus
Sophist Economicus's picture

Just got filled at $1631!   I thought this was going to feel good, but alas, I think that sound is my knees knocking.    Oh well, it's only fiat....

Mon, 09/26/2011 - 00:12 | 1709416 bob_dabolina
bob_dabolina's picture

Silver just shit it's pants a little bit


Mon, 09/26/2011 - 00:28 | 1709447 X.inf.capt
X.inf.capt's picture

i guess its time to put on the BIG BOY PANTS, or some DEPENS....

im scared too, but ill say it, cause im buying on the way down.....


Mon, 09/26/2011 - 00:16 | 1709421 bankonzhongguo
bankonzhongguo's picture

The Main Event is the fake implosion of Greece/Europe/Everyoneelse.

Notice the IMF incremental borrowing extensions over the last year.

First it was $50 billion.  Then selling gold to India.  Then increasing its borrowing facility to $500 billion on top of around $400 in other credit.

Lets cut to the chase.  The IMF will need to extend its capacities to shallow the Fed, ECB, Bank of England and the Chinese Hegemony before its over.

That is all this is about.

Greece is the AIG for European Contagion in order to create a Super TARP/ZIRP under the IMF.

Watch and wait.  The IMF will go hat in hand to the American taxpayers to bailout SG and Rothchild in three, two, one ...


Mon, 09/26/2011 - 00:17 | 1709424 Cliff Claven Cheers
Cliff Claven Cheers's picture

Danger Map should be changed to say Bailout Map.

Mon, 09/26/2011 - 00:19 | 1709427 kito
kito's picture

Bernankes shell shocked-- hes got post traumatic stress disorder from his war on growth.

Mon, 09/26/2011 - 00:22 | 1709436 Sophist Economicus
Sophist Economicus's picture

He's gonna have a hell of a time stopping asset deflation - but I think he'll have no problem with dollar debasement...

Mon, 09/26/2011 - 01:00 | 1709496 zorba THE GREEK
zorba THE GREEK's picture

Once a printer, always a printer. Bernanke will print again. He is just waiting for Europe to explode/implode.

At that point markets will be in turmoil, and there will be little resistance for Ben. That's the biggest problem

with fiat money, once you print your way out of a crisis like 2008-2009, every future crisis will be met with

calls to print again. It's like your girlfriend breaking down and giving you a BJ on your birthday, every occasion 

after that you will be asking for another; Valentine's Day, Christmas, Easter, Groundhog Day, Flag Day, Martin

Luther King's Birthday, Arbor Day, Labor Day, Memorial Day,Columbus Day,Halloween, Veteran's Day,Thanksgiving,

Election Day, New Years Eve, New Years Day, President's Day,St. Patrick's Day, Mother's Day, Father's Day,

Arm Forces Day, Independence Day, etc. etc.

Mon, 09/26/2011 - 01:17 | 1709518 Cliff Claven Cheers
Cliff Claven Cheers's picture

Haven't you heard, the Euro will be bailed out one way or another. Don't count on exploding, I actually think they will be last man/fiat standing.

Mon, 09/26/2011 - 02:43 | 1709723 MisterMousePotato
MisterMousePotato's picture

I green upped you just 'cause I admire people who lead with their chin. Would that I were so bold.

Who knows? History may prove your right. (aka ... good guess.)

Mon, 09/26/2011 - 01:49 | 1709566 chump666
chump666's picture

If the commodity markets collpase - sans oil, all the printing in the world won't do anything.

very bad vibes coming from those markets.

Mon, 09/26/2011 - 02:47 | 1709734 MisterMousePotato
MisterMousePotato's picture

"Bad?" Or, well, isn't a lot of this just exactly what many on this (and that douche, Deninger's) site have been talking about for years? We knew it was gonna be weird, didn't we? Including zombies cannibalizing us?

Mon, 09/26/2011 - 01:42 | 1709556 scatterbrains
scatterbrains's picture

The Bernank said he could ring out inflation in 15 minutes.. anyone recall how long his Op twist speach was ?


Mon, 09/26/2011 - 00:20 | 1709430 EZYJET PILOT
EZYJET PILOT's picture

This is an exchange i had recently an a pilot forum called PPrune, shows the ignorance of people regarding these matters.

EXEZY et al,

let's assume we would discuss heart surgery or quantum mechanics. Would you dare to voice an opinion about the right stent placement technique or the best way to trace neutrinos? Why is it that everybody able to hold a newspaper ( or an Ipad ) upright is now an economics expert ? What is your educational background? Your work experience? So you, an airline pilot who reads the Telegraph, knows what happens when you let the banks fail? You simply "clean up " and start from scratch, yeah? I would like to see your face in front of the ATM the next day.
I find it so tiring and ridiculous when pilots discuss world affairs and have a solution for everything, the middle east crisis, the afghan war, oil, global warming, you name it.
Pilots have to understand that not everything is ON or OFF, it is not that simple, for christs sake. 
Please stop bothering me with that nonsense in the cockpit, please please please .


My reply,


711, what an amazingly patronizing reply, I wouldn't expect anything less. I don't need to give my "educational background" to anyone, the beauty of this whole financial escapade is that anyone with half a brain can see the writing on the wall, you don't need a phd in economics to diagnosis the problem, after all, it's up to anyone with a heart beat to find out what is going on and then find a way to protects one's wealth. Do you think I research the markets and economics just to beat my chest and prove something on this pathetic forum, for crying out loud! 
The simple fact is, and yes it is very simple, the banks made far too many risky loans both in the sub prime mortgage crisis and now in the euro arena. Not content with this, they used their influence in politics and the fact that they are private shareholders at the Federal Reserve, to socialize the losses by off-loading bad gambles on to the balance sheets of the European/American people, often with the simple stroke of a keypad at the Fed which magically created trillions in fiat money to basically camouflage the gambles. The banks are given money on a plate to take away mistakes, the inhabitants of nations are made to pay for those mistakes, as in the case of Greece, with crippling interest rates and before anyone says the Greeks had it coming, why couldn't the banks see that before they purchased Greek debt? I'll tell you why, they bloody well knew that taxpayers would back stop them. Anyway rant over, I'm going back to study Part A now because as a pilot that's the only thing I should concern myself with. 

Mon, 09/26/2011 - 00:20 | 1709432 Reform1776
Reform1776's picture

This report is missing any detailed analysis of the impact of all of this to year end performance bonuses.

If someone could come in on the weekend to finish that part up, that would be great. Thanks.

Jamie Dimon


Sent from my IPhone

Mon, 09/26/2011 - 00:23 | 1709437 malek
malek's picture

So, according to the chart, China is at higher risk than Italy? Very funny.

Mon, 09/26/2011 - 00:23 | 1709438 MFL8240
MFL8240's picture

On a side note, Silver has been destroyed by the US lead crime ring in Chicago.  How does it feel to be fucked by the liars and cheats of the world?  Yup after 5000 years as a safe haven, Gold has been replaced by USD and traesury paper issued by an insolvent goverment. lol!!

Mon, 09/26/2011 - 00:30 | 1709457 hitbox
hitbox's picture

think about it - its the most beautiful scam in all of economic history!

Mon, 09/26/2011 - 00:40 | 1709474 Ms. Erable
Ms. Erable's picture

And it'll keep working - until it doesn't.

I really doubt my local coin dealer's going to sell me the shiny for anything less than spot + $10 this week (especially since I cashed in some junk a few weeks back for $3 under to pay for a nice weekend outing). Sticking by my $24.50 call for Tuesday's low.

Mon, 09/26/2011 - 00:32 | 1709461 Al Huxley
Al Huxley's picture

As big a bull as I am long-term on PMs and on the inevitable failure of all this Fiat BS, what happened to silver, and then to gold, is hardly surprising. Find me an example of a market-traded thing (commodity, stock, currency, I don't care) that traded way outside its channel to the upside, and that didn't subsequently crash big. I've been searching, haven't found any, but I've found tons of confirmations that once something pops big, it invariably overcorrects to the downside, usually for months. Sorry fellow bulls, unless this time IS different, its going to be a while before metals are the place to be again.

Mon, 09/26/2011 - 01:32 | 1709543 dalkrin
dalkrin's picture

I welcome a sustained plunge in PM prices.  As I only get a paycheck monthly, come the end of this week I will be doing my esteemed duty to the future of this planet by vacuuming up whatever remaining physical Ag I can afford.  Willing to catch this falling knife, I am wearing silver gauntlets.

Mon, 09/26/2011 - 00:43 | 1709476 Kina
Kina's picture

One can only trust that if the system breaksdown totally then the corrupt banksters who have been manipulating gold and silver (you know who you all are), corrupt regulators (you know who you are) and corrupt officials at the Fed and Treasury are all put to death for treason and or crimes against humanity.

Not not to mention the corrupt banksters who have been raping the US and the world for their own personal wealth and power, and their puppet politicians.

Wonder how all those people feel knowing that the public would only cheer if they were publically executed for their crimes. I guess they all think they are safe because they can cotrol the politician, judiciary, laws and the sytem and that they will never be bought to justice.

And they are probably right. They will find scape goats instead. So I imagine they will be a few from the CFTC and SEC etc that will carry the can representing corrupt regulators and likewise a few sacrificial banksters out of the loop.





Mon, 09/26/2011 - 00:34 | 1709464 adr
adr's picture

The mad dash for dollars is on. Truly bad for stocks, poor overseas earning floats aren't going to cut it anymore. This is the precursor to the trade war, which will last a few months before they announce a world reserve. I believe the world mark may still be called a dollar but it won't have an American president on it. The big players know what the new currency will be backed with and they want you to sell your metals and they are giving you the chance to make some money before it is worthless.

Citizens will not be allowed to exchange gold for the new currency but it will be backed by it, but only soveriegn holdings. The value of the global dollar will be enough to keep billionares rich but low enough to keep the rest of the world in poverty. The collapse was orchestrated to create the mother of all cash grabs for the global elite. Th new normal will be just enough to squeak by. If you choose your choice will be made for you and your meaningless service job and you basic needs will be provided. Russian styl housing projects for everyone, works great for millions of chinese.

Who knows maybe you'll get 1 world dollar for every 10 American ones. Maybe you'll get 2 for 10 Euros. One thing is for sure, holding gold will be outlawed and therefore worthless other than backing currency. The gold standard will return and we'll be slaves to it.The elite think it is the onlyway to ensure security. Maybe I'm wrong, I hope I am.

Mon, 09/26/2011 - 00:45 | 1709481 seek
seek's picture

Holding heroin is outlawed too, but it doesn't follow that it, or any other banned material, is worthless.

Given that the USD is not backed by gold any more, they'll have to work hard to contrive a reason to ban its possession. I can see them changing its tax treatment, but the same is true for just about everything else.


Mon, 09/26/2011 - 00:55 | 1709487 Kina
Kina's picture

They can make all the laws they like about gold and silver in the US. Wont amount to a hill of beans in either Europe or Asia or Ociania. Like pouring water into a seive.

Mon, 09/26/2011 - 01:08 | 1709504 bankruptcylawyer
bankruptcylawyer's picture

its amazing these firms get paid for charts  like this. what nonsense these danger rankings are. total utter hogwash...the whole premise of quantifying quality . i've seen it time and again as we all ahve. and consultants will keep using this nonsense method so long as they get paid.



Mon, 09/26/2011 - 01:20 | 1709521 monopoly
monopoly's picture

Very nice article Tyler, easy to understand and makes me want to hide under a rock.

The dollar is looking good. Yes, it is the best of the worst. Not its turn yet. I mean, we do not even have 16 trillion in debt yet. With margin hikes, scared traders, hedge funds getting wiped out and computers taking over with 0 emotion, gold, silver getting dumped again.

How many times have we talked about 0 margin. Using leverage is gambling. Gold, silver, quality miners they all get hit time and time again. This too shall pass. And if you have some free cash, be patient.

Silver down to 28. Actually I can see 25 or even 24 before it settles down.  That is ridiculous. Remember this is not about fundamentals, nothing has changed, emotions have taken over and it is out at any cost.

It was getting a little too easy with gold the last month or so. Not a big fan of manipulation. People give the idiots in charge way too much credit. This is what markets do. It hurts me too with profits in my core positions wiped out for the last 4 months. But changing nothing.

Good Night

Mon, 09/26/2011 - 01:27 | 1709531 Cliff Claven Cheers
Cliff Claven Cheers's picture

Isn't increasing margins manipulation?

Mon, 09/26/2011 - 03:09 | 1709789 Flatchestynerdette
Flatchestynerdette's picture

Europe is selling everything it has. Christine Lagarde says the IMF needs billions more......where else is she going to get it but by selling hard assets to raise euro's or dollars?

Mon, 09/26/2011 - 01:42 | 1709557 slewie the pi-rat
slewie the pi-rat's picture

well, when you're looking for a good, 152-page nightmare, doucheBanksters deliver!

Mon, 09/26/2011 - 01:50 | 1709569 shaxmatist
shaxmatist's picture

Japan with its 200%+ of debt to gdp gets the best score on these clowns "danger map"??


Mon, 09/26/2011 - 02:02 | 1709600 bob_dabolina
bob_dabolina's picture

Holy shit, PM gapping down

Gold -60 

Silver off 15%

Mon, 09/26/2011 - 02:09 | 1709620 dark pools of soros
dark pools of soros's picture

calling Tom Cruise.... piigs flying into the danger zone

Mon, 09/26/2011 - 05:39 | 1710249 BarryG
BarryG's picture

Siemens has just moved E4bn from French banks to the ECB...

Mon, 09/26/2011 - 07:00 | 1710302 trx
trx's picture

I'm going for Lithium, Valium and Opium...

Mon, 09/26/2011 - 14:47 | 1712297 hooligan2009
hooligan2009's picture

one of those papers that is long on design and very short on proper scoring of factors. there is an assumtion that no change in variables = success for countries like Japan...bleh. 150 pages, i had high hopes, the hard numbers for balance sheet analysis are good for context, but other items like loans as a percentage of total assets = low number completely misses the point that loans are not equal to total assets.

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