What will the upcoming Deutsche Bank failure mean for gold?
derryb
Posts: 36,821 ✭✭✭✭✭
Merkel says no bailout, does this mean depositor bail-in?
DB for a while now has been a major threat to the euro landscape. Only a matter of time. What will it's demise mean to the euro?
When euro goes down, US dollar goes up.
When US dollar goes up gold goes down. . . normally. Will it be different this time as new safehavens are sought? We shall soon see.
DB for a while now has been a major threat to the euro landscape. Only a matter of time. What will it's demise mean to the euro?
When euro goes down, US dollar goes up.
When US dollar goes up gold goes down. . . normally. Will it be different this time as new safehavens are sought? We shall soon see.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
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Merkel says no bailout, does this mean depositor bail-in?
DB for a while now has been a major threat to the euro landscape. Only a matter of time. What will it's demise mean to the euro?
When euro goes down, US dollar goes up.
When US dollar goes up gold goes down. . . normally. Will it be different this time as new safehavens are sought? We shall soon see.
This is what I was talking about in my post, I agree European Banks are in trouble and I agree capital will move to the Dollar making a lot higher US markets and stronger dollar. Now if the Fed's hit the rate hike in December and the Dow or markets and the Dollar makes it move I think 2017 will be a super buying opportunity for metals but I think the markets and the Dollar will be short lived.
I don't think there is much correlation. The euro is in the same shape as all other currencies . Go figure. Banks grow too big to fail and when they do, a lot of poverty gets spread around.
and repeat again
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Here's a warning parable for coin collectors...
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't hold your breath waiting for DB to go down. Not gonna happen.
Yeah, you're right, its probably nothing...
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't hold your breath waiting for DB to go down. Not gonna happen.
Lehman was like a boutique specialty store compared to DB. The King was able to cover the failed assets of Lehman and restore markets. For DB which probably has 10X to 100X the risk and leverage that Lehman had, it will takes all the world's Kings, and all the Kings' horses, and all the Kings' men to keep Humpty Dumpty on top of that wall. Turkey has been talking about taking over DB. They do need a bigger bank to keep their money laundering ops growing. But can they afford to assume the 42 TRILL Euro in derivative's risk? Even if only 3-5% of the debt/positions failed as so many models suggest, that's still a couple TRILL Euro to cover. The GDP of Germany is only 3 TRILL Euro.
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Would not be surprised to see DB's share price stop right here in the $9-$11 range. It's got a fairly advanced EW structure, looking to be in a final 5th wave of 5. And its 14 year log chart has an enormous wedge whose lower projection points to $11....right where it is now (or approx $5 on a linear chart). It peaked in price in May 2007....5 months before the US stock market. I guess DB never got its full share of QE to keep the charade going. One thing that 2008 taught these guys. A monster bank cannot be allowed to fail on its own....at least not without a daisy chain that would take most of them all down together. They will try to protect their own.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
well, shoot......who else is there to take the hit, besides depositors?
Deutsche Bank is currently a counter party to virtually every major bank in the world, in virtually all asset classes.
The critical question seems to be which of DB's leveraged bets have gone bad, and who is on the other side?
Didn't US taxpayers donate a big wad of QE to Europe last time around? Where does all that money actually go?
Something tells me that there's some re-pricing going on as we speak.
We plebs just aren't privy to exactly what it means. What it means to me is don't own bonds. Debt is cheap and it's probably going to get cheaper.
Of course, the dollar is a debt instrument too.
It could really get interesting. This is uncharted territory. I don't know which asset class is best to own although I still suspect that it's metals and cash. Weird goings-on.
Who is John Galt?
I knew it would happen.
Don't hold your breath waiting for DB to go down. Not gonna happen.
http://quicktake.morningstar.c...t/bonds.aspx?symbol=db
http://www.wsj.com/articles/de...-securities-1473975404
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
news is saying the reduction in the fine will stave off any trouble
DB can manage the reduced fine with their reserve set aside for the fines
apparently not any more
news is saying the reduction in the fine will stave off any trouble
"rumor is saying."
DB execs have not even arrived in the US yet to negotiate with regulators.
Any "agreement" to reduce their fine will only confirm how dangerously close they are to bringing down the system. These fines don't get negotiated until there is no other choice. View any reduction as a strong indicator of how dangerous DB is to all things not DB.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
apparently not any more
news is saying the reduction in the fine will stave off any trouble
"rumor is saying."
DB execs have not even arrived in the US yet to negotiate with regulators.
Any "agreement" to reduce their fine will only confirm how dangerously close they are to bringing down the system. These fines don't get negotiated until there is no other choice. View any reduction as a strong indicator of how dangerous DB is to all things not DB.
I've never heard of a financial company agreeing to pay a "recommended fine". This is the game that regulators and large financial corporations play and it wouldn't show where DB stands one way or another. It has nothing to do with the position a company is in, it had to do with the issue and impact against customers, how the issue was created and what was done to resolve it after it was identified. It is the CEO's duty to shareholders and other interested parties to minimize any possible fines. Look how easy Wells Fargo got off after possibly ruining 2,000,000 customers credit scores and charging fees on products they never signed up for.
PS: This is what I do for a living...
I've never heard of a financial company agreeing to pay a "recommended fine". This is the game that regulators and large financial corporations play and it wouldn't show where DB stands one way or another. It has nothing to do with the position a company is in, it had to do with the issue and impact against customers, how the issue was created and what was done to resolve it after it was identified. It is the CEO's duty to shareholders and other interested parties to minimize any possible fines. Look how easy Wells Fargo got off after possibly ruining 2,000,000 customers credit scores and charging fees on products they never signed up for.
PS: This is what I do for a living...
So, how many times in recent years have US regulators agreed to reduce a fine for a Too Big Too Fail bank? If they agree to reduce this one it will reflect just how close DB is to failing.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I've never heard of a financial company agreeing to pay a "recommended fine". This is the game that regulators and large financial corporations play and it wouldn't show where DB stands one way or another. It has nothing to do with the position a company is in, it had to do with the issue and impact against customers, how the issue was created and what was done to resolve it after it was identified. It is the CEO's duty to shareholders and other interested parties to minimize any possible fines. Look how easy Wells Fargo got off after possibly ruining 2,000,000 customers credit scores and charging fees on products they never signed up for.
PS: This is what I do for a living...
So, how many times in recent years have US regulators agreed to reduce a fine for a Too Big Too Fail bank? If they agree to reduce this one it will reflect just how close DB is to failing.
To answer your question, I have no idea how many but it happens all the time with every company. Whether it is something huge like a LIBOR rigging or a fine could stem from a customer complaint. If you do a quick google, "bank negotiates fine", that search comes up with a bunch of different names of companies.
Fines are no different than conducting any other business transaction. That is what fines are to financial services companies....part of business.
I'm not sure where you think negotiating fines has to do with the health of a company, because it has nothing to do with it. It has to do with a company trying to pay out as little as possible. It doesn't matter if it is Goldman, VW, Johnson & Johnson or negotiating an OSHA fine for a construction company... they will all do whatever they can to reduce the fine they have to pay. No different than you and I challenging a speeding ticket in court. We hope the cop doesn't show up or they didn't calibrate their radar in hopes of getting off or getting a reduced fine.
Going back to the topic, I think DB will eventually become a mess. Whether it collapses or there is a bail out or a bail in, its future is not looking good. Uncertainty fuels metals, and these days a lot of what is going on and what the future holds is very uncertain. That is part of why I'm holding some shiny.
I think everyone can agree what you said the show has just began, we will join in 2018 when social security and the dept crisis began. Marco Rubio was the only one the brought up the coming social security problem and that died off quick, we need to talk about more important things like birth certificates and small hands.
I'm not sure where you think negotiating fines has to do with the health of a company, because it has nothing to do with it. It has to do with a company trying to pay out as little as possible. It doesn't matter if it is Goldman, VW, Johnson & Johnson or negotiating an OSHA fine for a construction company... they will all do whatever they can to reduce the fine they have to pay. No different than you and I challenging a speeding ticket in court. We hope the cop doesn't show up or they didn't calibrate their radar in hopes of getting off or getting a reduced fine.
If the fine will take down a Too Big Too Fail Bank and in turn take down the economy then regulators will think very hard about the size of the fine. TBTF banks are in a different category than your run of the mill company that cannot take down an economy. US regulatory agencies do not want to be viewed as the cause of economic depression. Ironically their failure to do their jobs since 2008 is why we are where we are today.
DB failure is a serious threat to the economy. Regulators will not let their regulating be the reason DB goes down. A reduction of their initial fine will indicate just how close to the edge DB is.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
So, how many times in recent years have US regulators agreed to reduce a fine for a Too Big Too Fail bank? If they agree to reduce this one it will reflect just how close DB is to failing.
Nice call derryd on the fines looks like they will reduce it from 14 Billion to a few million over 5 billion.
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Look out below
Nice call derryd on the fines looks like they will reduce it from 14 Billion to a few million over 5 billion.
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Look out below
Gold down $35.80 now. This happened in 2008 as well. Does anyone think these are normal market movements?
Bill Gross has a good writeup on zerohedge about the Fed's policies. Italy just issued some 50 year bonds. Anyone interested? Good yields?
If you think that DB is simply responding as a normal business does to proposed fines, you are not sufficiently jaded yet. But, you're getting there.
I knew it would happen.
hate it as we all have gold. the chart ran to 137x or so then pulled back and only ran to 134x or so. that was a danger sign.
But where does it go from here? I don't know
they'll be pressing for that rumoured 5.4Bil fine
that looks like it is panic averted.
DB was up on the German stock exchange today.
Perhaps this good news on the banks also contributed to the gold slide??
obviously a panic is being expected.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't hold your breath waiting for DB to go down. Not gonna happen.
"If you push something hard enough, it will fall over"
It's only a matter of time before the next big bang !
Imminent invasion or imminent bank failure?
obviously a panic is being expected.
Panic yes. Banking? Possibly. It can be claimed the terror excuse in the article. They could know something about the likelihood of a dirty bomb threat. On another front, the easiest land pass into Western Europe from Russia is through Germany.
Possibilities.
What a crock.
I knew it would happen.
If corn goes up, is that a good omen for the Cornhuskers? They seem to be on a roll this year.
I knew it would happen.
back to the topic, I think DB will eventually become a mess. Whether it collapses or there is a bail out or a bail in, its future is not looking good. Uncertainty fuels metals, and these days a lot of what is going on and what the future holds is very uncertain. That is part of why I'm holding some shiny.
Nice call derryd on the fines looks like they will reduce it from 14 Billion to a few million over 5 billion.
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Look out below
Gold down $35.80 now. This happened in 2008 as well. Does anyone think these are normal market movements?
Bill Gross has a good writeup on zerohedge about the Fed's policies. Italy just issued some 50 year bonds. Anyone interested? Good yields?
If you think that DB is simply responding as a normal business does to proposed fines, you are not sufficiently jaded yet. But, you're getting there.
So with Wal-Mart fighting their $600,000,000 fine, does this mean that they are about to collapse too? http://finance.yahoo.com/news/wal-mart-balks-paying-600-161953058.html
If you want, I can post probably 50 other links to articles where large companies are fighting fines from THIS YEAR, but what do I know...
The problem is that the central bankers are addicted to doing business in a way that isn't sustainable and they keep trying to sustain poor policies. Sooner or later you run out of other people's money.
I knew it would happen.
So with Wal-Mart fighting their $600,000,000 fine, does this mean that they are about to collapse too? http://finance.yahoo.com/news/wal-mart-balks-paying-600-161953058.html
If you want, I can post probably 50 other links to articles where large companies are fighting fines from THIS YEAR, but what do I know...
DB's problem is not in being fined. It is a problem of having the money (liquidity) to pay the fine. DB is highly leveraged in derivatives (bets) with other banks, many of whom will heavily share DB's pain.
Highly leveraged banks cannot afford the need for billions of quick cash to pay a fine. The difference between DB and the Walmarts is in their business models. Walmart has cash, inventory and real estate - it has real assets. DB has receipts from the bookie who may or may not be able to pay up if DB ruins the game. DB, like most all highly leveraged banks (most all banks), doesn't even have 90% of the cash that depositors trusted them with. The Wall Street led repeal of the Glass-Steagall Act empowered them to gamble with it.
Regulatory agencies that impose fines on financial institutions surely have to consider the consequences of the amount of their fine. This is why the final amount will tell us everything we need to know about the health of DB. A lowered fine will confirm what the IMF has said about DB being the largest threat to the world economy.
The biggest failure is the fact that the lessons from bad banking practices in 2008 still elude those controlling the economy while those ruining it continue to rack up massive personal profit. Wells Fargo is a prime example of how bankers are allowed to personally profit while shearing the customers and never having to face a jury made up of those customers.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Good eight part series on DB:
How a Pillar of German Banking Lost Its Way
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Go ahead, buy the low
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
They're talking now about loosening the restrictions on liquidity requirements and leveraged trades by the banks that were enacted in the watered-down 2010 Dodd-Frank Bill.
https://heritage.org/markets-and-finance/report/financial-regulatory-reform-the-house-and-senate-brief-comparison
More fun 'n games for banking.
I knew it would happen.
I am pretty sure its already baked in the numbers, been watching the demise for the past 10 years. Death by a thousand pin pricks
Best place to buy !
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