Max Keiser (report 821) reports that Deutsche Bank recorded a $6 billion loss and is exposed to $70 trillion in Derivatives...Wow that is high seeing that the GDP of Germany is around $3 trillion. If this bank is in trouble then so is the whole of Europe. Regards Errol 43
She'll be alright. $6bn is for 'impairment' charges for the value reduction of Postbank and increased capital requirements for the investment side of things. Also taking a loss of 500m+ for its stake in some Chinese bank it wants to ditch and budgeting a billi for litigation costs. Predicted 25,000 job cuts and bankers bonus cuts are on the way so really not expecting much to come from this. Or it's The Black Swan we'e all been patiently waiting for. Errol, if you can lay your hands on Tavakoli's 'Credit Derivatives and Synthetic Structures' I'm sure you'll thoroughly enjoy it. $700tr exposure and counting...
No one can say how this can unwind. Last time Fed and everyone plugged whatever they could. The thing that gets me is the over the counter market. Brooksley Born was instrumental in bringing so much to the public. Look up Brooksley Born and watch some of her on video.
looks like Deutsche Bank is finally going under! Policy makers are saying there isn't going to be a bailout. How long before their stock ticker reads 0?
Media have been talking up a collapse in the last few hours: http://www.express.co.uk/finance/ci...Lehman-Brothers-financial-banking-crisis-2008 http://www.cityam.com/250177/analysts-fear-deutsche-bank-could-become-europes-lehman
No idea who this guys is, but released today and he's calling a bail-IN: [youtube]http://www.youtube.com/watch?v=D0lYdIdrLMI[/youtube]
It's not just Deutsche Bank. Germany's banking system appears to be cracking: From the Daily Mail: "In the latest manifestation of Germany's banking problems, Commerzbank, the nation's second largest, has just announced that it is to cut 9,000 jobs and axe the dividends it pays to shareholders in a desperate effort to cut costs and build up its capital reserves. Elsewhere in Germany, the so-called Landesbanken or regional banks are reportedly burdened with bad loans and desperately need a major overhaul." Who would have thought Germany would be the first card to fall in a Eurocollapse? My money was on Italy, but if Germany makes the ship list, Italy will sink it.
But its derivatives.... If you have or trade derivatives with Etrade on ASX, what will happen if etrade went under? Isnt your call or swaps or puts all are registered under your name?
I didn't mean the order of failure but the first shock big enough to properly threaten the EU's viability.
Deutsche Bank is 10 times bigger than Lehmans and we all know what happened there. I don't expect thsi to end well! Regards Errol 43
If they actually got into trouble, German and European bank will have to rescue it, but end of the day they got zero profit because they will have to pay 14bilion in fines.
Big difference between Germany and Italy banks is that the Italian government is prepared to bail out the bank sector but the German government isn't. Seems like there could be a bit of a perfect storm brewing though. I'm a bit surprised gold isn't responding to the recent Deutsche Bank headlines....
Nothing to worry about, last GFC or Greece etc nothing much changed. I can even recall the one or two banks that shut lol
IF DB takes a tumble, there's a good chance other stressed German banks will follow and then we have a bigger problem than poor little Greece. Australia won't get off so lightly next time. There is no money in the piggy bank and private debt is running at a staggering 160% of GDP, making Australia the world's No 1 for household debt. Then there is our reliance on China, itself starting to stagger under an overwhelming load of bad debt.
