Loading ...The euro futures contract has been moving sideways creating a large triangle. The apex is getting very close and a breakout is imminent. The size of the triangle indicates a large move one way or the other.
europe is about to explode with financial and social upheaval. I don’t think this time will be papered over like the past.
rno
Dump Deutsche Bank ETNs Now=
Today, Deutsche Bank (NYSE:DB) is the issuer of 20 ETNs currently offered to U.S. investors, although only 19 of them are listed for trading.
Sep. 29, 2016 2:59 PM ET| Includes: BDG, DB, DGP, DTO, FIEG, SCO, UGL
Ron Rowland Ron RowlandFollow(36,823 followers)
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Unlike exchange-traded funds (“ETFs”) and mutual funds, which are legally structured as stand-alone entities, exchange-traded notes (“ETNs”) are debt obligations of the issuer. What is more, they are “unsecured” debt obligations without any type of collateral. Therefore, ETNs carry an additional risk, a risk that would be realized if the issuer were to default or declare bankruptcy.
This risk was overlooked in the early days of ETNs for a couple of reasons: (1) Such a default had never happened, and (2) the issuers were banks that most investors considered to be “too big to fail.” Then along came the financial crisis and the collapse of Lehman Brothers. Lehman was the issuer of three U.S.-listed ETNs under the “Opta” brand, including the Opta S&P Private Equity ETN (former ticker PPE). When Lehman declared bankruptcy eight years ago, owners of the three Opta ETNs were left holding the bag.
Today, Deutsche Bank (NYSE:DB) is the issuer of 20 ETNs currently offered to U.S. investors, although only 19 of them are listed for trading. Over the past week or so, legitimate concerns about the financial viability of DB have surfaced. Its stock has plunged 19% in eight trading days, surpassing the 2008 financial crisis low. The company faced credit rating downgrades earlier this year, the U.S. Justice Department is seeking a $14 billion settlement related to mortgage-securities investigations, and the German government is getting nervous.
DB probably falls into the “too big to fail” bucket among European financial institutions, but what if it’s not? If DB has borrowed money from you, then you should be concerned. If you own DB ETNs, then DB has borrowed money from you, and your loan to DB is not secured with any collateral.
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At least the senate finally agreed on something. Don’t think it’s over yet. The Saudi’s moving to sell off assets for fear of them being frozen would depend on buyers. Any quick moves would create panic scenario which would hurt their bottom line. Plus dollar still king so they would have to be careful where they put it. Plus we have our own government who would have to keep up their own window dressing buying them back. What would happen if Trump wins is not known. So keep that in mind if they blame Trunp for the fall later, if their is one. Also keep a eye on and class action group of lawyers forming.
China’s debt is a staggering $24 trillion with 247% of annual GDP as of last year, which is, in fact, an increase of an astounding 465% within a decade. The total borrowing by both the financial and non-financial sectors was only 78% of the GDP in 2007 and has since increased to 309% of GDP according to economists at Nomura Holdings Inc. led by Yang Zhao and Wendy Chen.
Some naysayers believe that the leverage in China is still far below that of what the U.S. was in 2007 previous to the financial crisis. However, they neglect to note that the property sector has increased by 4.5 times between 2000 and 2015 within the top-tier cities. Experience suggests that such a rise is both unsustainable and “bubbly.” A sharp drop in the property prices will increase the leverage to astounding levels, thereby threatening their economy.
Huge Fiscal Deficit Challenge
The IMF has forecasted that China will have a moderate budget deficit of 3%, which sounds very comfortable. The IMF has merely considered the government’s debt so as to arrive at said figure, which accounts for less than 20% of public spending. The local governments and municipalities in China account for over 80% of public spending.
When the total figures are considered, this balloons to 10% according to the IMF, whereas, Goldman Sachs believes that number is much higher – above 15%. These numbers are far worse than those in the United States directly before the financial crisis of 2008.
Most state-owned companies are taking on more debt in order to pay off their earlier debt. Bad loans soar, as shown in the chart below. The government has not allowed any major firms to become bankrupt in order to keep their job numbers propped up. If they start to let companies fail, unemployment numbers could skyrocket!
Euro “Might Start To Unravel” If Collapse Of Deutsche Bank
By Mark O’Byrne September 28, 2016 0 Comments
The euro “might start to unravel” if Deutsche Bank collapses according to respected financial journalist Matthew Lynn. “It all has a very 2008 feel to it …” he warns in the Telegraph where he outlines his growing concerns about Deutsche Bank, concerns we have written about in recent months. He writes:
Our image of German banks, and the German economy, as completely rock solid is so strong that it takes a lot to persuade us they might be in trouble.
And yet it has become increasingly hard to ignore the slow-motion car crash that is Deutsche Bank, or to avoid the conclusion that something very nasty is developing at what was once seen as Europe’s strongest financial institution. Its shares have been in free-fall for a year, touching a new low of 10.7 euros on Monday, down from 27 euros a year ago. Over the weekend, the German Chancellor Angela Merkel waded into the mess, briefing that there could be no government bail-out of the bank.
But hold on. Surely that is an extra-ordinary decision? If the German government does not stand behind the bank, then inevitably all its counter-parties – the other banks and institutions it deals with – are going to start feeling very nervous about trading with it. As we know from 2008, once confidence starts to evaporate, a bank is in big, big trouble. In fact, if Deutsche does go down, it is looking increasingly likely that it will take Merkel with it – and quite possibly the euro as well.
Merkel is playing a very dangerous game with Deutsche – and one that could easily go badly wrong. If her refusal to sanction a bail-out is responsible for a Deutsche collapse that could easily end her Chancellorship. But if she rescues it, the euro might start to unravel. It is hardly surprising that the markets are watching the relentless decline in its share price with mounting horror.
Turkey is moving to buy damaged banks in Europe. There is no way the German people will allow it. They will also not allow another bailout. Doushbank may have to be dissolved to get rid of the derivatives with assistance to the banks assuming the good assets.
Watch the grain market if the stocks report is bearish and grains rally. A lot of scared fiat is looking for a home.
Rno
There is a difference in fact a number. First one is the banks are making nothing/loseing huge money, as income is near zero…no-one wants their mad derivatives in the real world, the books are only growing due to trading between themselves and hedge funds. They can only try to make money trading and most can’t. But what is killing them is the salaries/bonus’, they are still paying themselves fortunes and thus have hollowed out the banks.
This is why say B o A are stealing off their own customers and paying off the perp $ 125 million, the last money source is their own deposit base. My wife and I have both had decades old preferential overdraft rates cancelled next year and replaced with ones at 19 % pa !!!!!! with a base rate of 0.25 % !!!!!!! This is from RBS, the PoS that taxpayers still own and bailed out for £ 45 billion. No reason given, it won’t hurt us, we can live without it, but people who are unable to pay it off, will be killed.
So the banksters are now desperate, as the game is near over, such amoral thugs will likely panic much more easily than in 2007/9, as they know they have little time to steal their wedge and politically bailouts are impossible…..I would not want to be down wind of any City/Fall st out houses !!!!!!!
Cheers
The Financial System Is On The Cusp Of Collapse
September 29, 2016Financial Markets, Market Manipulation, U.S. Economycredit bubble, derivatives collapse, Deutsche Bank collapse, Wells Fargoadmin
DB stock is now in a full panic sell-off as I write this. It just hit another new all-time NYSE low on by the heaviest volume ever in the stock since its 2001 NYSE listing. It’s currently down almost 10%. No doubt the Central Banks will try to bounce it.
Deutsche Bank may well be the scapegoat this time around just like Lehman was the scapegoat in 2008. Central Banks in collusion can prevent just one bank from collapsing. It was the co-collapsing of AIG and Goldman Sachs that prompted then-Secretary of Treasury, ex-Goldman CEO Henry Paulson, to put in motion the bailout of the U.S. and European banking system.
Yesterday it was reported that the rate the Fed charges the banks to borrow collateral surged to its highest rate in 7 years – LINK. The rush to borrow collateral was no doubt prompted by OTC derivatives-related counter-party collateral calls. A collateral call is like a margin call in a stock account. This occurs when a derivatives trade goes south for an entity that is on the long side of the derivatives bet – a bet that Deutsche Bank won’t default, for instance – and the counterparty to that trade demands more collateral to be posted in order to insure that the bet can be paid off if the “long side” loses.
Now multiply that concept across thousands of derivatives trades involving hundreds of hedge fund and bank counterparties totalling $100’s of trillions. It does not take too many collateral calls before counterparties and Central Banks run out of collateral that can posted against these OTC derivatives margin calls. That’s happening now.
This is 2008 redux – only this time the damage inflicted by derivatives counterparties collapsing will be much worse because the size and scale of the problem is much larger.
Deutsche Bank is at the center of focus, but there’s no question that U.S. Too Big To Fails are in similar financial condition. If that’s not the case, then why won’t Fed unwind the “QE” that created the $2.3 trillion in bank “excess reserves” sitting at the Fed? Pull this rug out from under Goldman, JP Morgan, Wells Fargo, B of A etc and the entire U.S. banking system will collapse. But that will happen at some point unless the Fed cranks up the printing press again.
Deutsche Bank may well be the catalyst that throws a “spark” that lights the fuse on $100’s of trillions of financial weapons of mass destruction. It was just reported that DB’s hedge fund clients are rushing to draw all excess cash held at the bank. That’s how the run begins. DB’s stock is down 8% right now on 33 million shares. This is 3x the 10 day average trading volume and over 6x the 90 day average – with 2 hours left in the trading day. It’s as if someone turned on the light in the kitchen and the cockroaches are running for cover.
Make no mistake, DB is not the only big bank in trouble right now. I have no doubt the phone wires between the U.S. and European Too Big To Fails are sizzling. This is also the reason the manipulators have been throwing a “scorched earth” attempt to push gold and silver lower. Again, this is just like 2008 when the manipulators took the price of gold down from $1020 to $700 – right before the entire banking system de facto collapsed.
Deutsche Bank may well be the “canary” but the “coal mine” is the banking system – European and U.S. – and there will be plenty of dead birds before this is over.
http://investmentresearchdynamics.com/the-financial- system-is-on-the-cusp-of-collapse/
***
Rick’s Pick for Thursday
Nothing to See Here, Folks…
Posted Thursday, September 29, at 6:45 p.m. ET
U.S. stocks executed a shallow swan-dive around mid-session on Thursday, spooked by news that a bunch of hedge funds had withdrawn spare collateral parked with Deutsche Bank. Predictably, the pundits downplayed Deutsche’s problems, including a $14 billion shakedown by U.S. regulators to settle mortgage claims from the Great Financial Crisis. With no hint of irony, Bloomberg.com calmly noted that “the situation doesn’t appear to be that dire for Deutsche Bank at the moment. But it’s clear the lender’s problems are escalating rapidly.” Did your scalp tighten, or your heart palpitate, when you read that sentence? None of us will have forgotten that “the situation” didn’t appear to be “that dire” for Lehman or Bear Stearns either — up until mere days before each went down like the USS Thresher.
So much for the theory that the problems of some little bank could conceivably be the black swan that topples the global financial system for a second time in a decade. This particular bank is as symbolically important to perceptions of Germany’s financial stability as B of A is to America’s. Bloomberg’s reassurances aside, and notwithstanding the fact that U.S. stocks ended the session with a moderate bounce, an investor would have to be out of his mind to be fully loaded with shares at these levels, just inches from all-time highs, with no respite in sight for a decline in U.S. corporate earnings that is about to enter its sixth straight quarter. To repeat: OUT OF HIS MIND!
Thursday, September 29, 2016 by: L.J. Devon, Staff Writer
Tags: government corruption, pay to play, email leaks
(NaturalNews) Meet Matthew Barzun, the U.S. Ambassador to the United Kingdom and Sweden. Barzun bought his ambassadorship, paying more than $3.5 million to the DNC and Obama’s Organizing for Action nonprofit from 8-21-2009 to the present. This is how the government has been operating under Obama; globalists are paying large sums to take up roles in the U.S. government in order to carry out their own agendas. The same sort of corruption occurred through the Clinton Foundation. After Hillary was appointed secretary of state, foreign donors gave to the foundation only to gain favors in return.
Matthew Barzun isn’t the only one buying his way into the government. In fact, a new leak by WikiLeaks reveals that at least 24 top government positions were appointed based on donor status. Over 55 pledgers to Obama scrambled to donate large sums of money to buy positions within the government. Tony West paid over a million dollars to be appointed deputy attorney general on March 9, 2012, the very same day his money was recorded in the DNC’s ledger. Charlie Rivkin pledged over 2.5 million to Obama’s “nonprofit” in exchange for swiftly becoming assistant secretary of state and ambassador to France. Robert Roche pledged over 1 million to Obama, and was quickly put on the Advisory Committee for Trade Policy.
The Wiki leak reveals that most ambassadors to foreign nations were purchased. Other countries take advantage of this and can easily purchase ambassadorships within the U.S. government so that they can negotiate insider deals with their respective countries. This is how the U.S. people have been ripped off. The U.S. citizen just gets taxed more so other countries can run off with the money. The U.S. people are left with nothing but the change, crumbling infrastructure, and sadly, the poor are hurt the most. If the democratic party wants to talk about income inequality, let’s start with how the rich bought their way into the government and took more money from everyone else, auctioning off our future.
This Wiki leak makes clear to the U.S. people why Obama’s foreign policy and trade deals were brazenly incompetent and against the interests of the United States. It’s all because the Obama administration gave favors to foreign countries and sold away top positions and ambassadorships within the government. As a matter of history, Obama and Clinton will always be remembered for shipping weapons and money to the Middle East, and will always be responsible in some way for strengthening the insurgency of ISIS and radical Islam ideology around the world.
A government that was originally founded as a republic, bound by the rule of law, has become an intricate network of wealthy power seekers who think that they are above the law, because they have bought their way into power positions in the government. As the republic has dismantled, so has democracy. The voice of the people is shut out and gagged, as the top payers get what they want.
Under President Barack Obama, the U.S. government has become a nation of, by, and for whomever can pay the most to play leadership roles. Under President Barack Obama, the Democratic Party has become more like a globalist oligarchy, auctioning off top positions to whomever can pay for them.
These globalists who buy ambassadorships into the U.S. government have little concern for the freedoms of the individual. They are more concerned with pledging allegiance to globalist agendas that have the greatest financial incentives. The sovereignty of the United States does not matter to them.
cant blame BUSh anymore ,,,so Putin is now the BAD BOY .. and he dont get to VOTE ! Obla BLA wont do anything he’s worried about his “LEGACY”,,KERRY is a fool and cant do anything but be Puties Whipping BOY ! LOSE,LOSE,LOSE
What you said would imply that the money masters aka banksters and warmongering Neocons have no dog in the fight. They are all-in for Hillary and cannot crash the markets before the election.
I’m going on the assumption that Trump is a real candidate and not neocon “controlled opposition”.
Just gotta love that Kerry and his neocon controllers are breaking off talks with Russia and considering military options.
Just what this country needs, provoking Russia. Unbelievable.
They have to crash the Markets before NOVEMBER .I cant ever recall a crash after the first week in NOVenber !
Wild! DaddyO! 
That DXD is a great trade, especially after Trump cleans Hillary’s clock in the election. No doubt the bankster boyz will crush the markets to punish the American people after voting for a candidate who thinks about America first.
Look at them crush the VIX in the AH, you’ll need that November time frame for the big plunge.
who coughed on the sixth floor of Harlem crowned with flame
under the tubercular sky surrounded by orange crates of
theology,
who scribbled all night rocking and rolling over lofty incantations
which in the yellow morning were stanzas of gibberish,
who cooked rotten animals lung heart feet tail borsht & tortillas
dreaming of the pure vegetable kingdom,
who plunged themselves under meat trucks looking for an egg,
who threw their watches off the roof to cast their ballot for
Eternity outside of Time, & alarm clocks fell on their heads
every day for the next decade,
who cut their wrists three times successively unsuccessfully, gave
up and were forced to open antique stores where they thought
they were growing old and cried,
who were burned alive in their innocent flannel suits on Madison
Avenue amid blasts of leaden verse & the tanked-up clatter of
the iron regiments of fashion & the nitroglycerine shrieks of
the fairies of advertising & the mustard gas of sinister
intelligent editors,
or were run down by the drunken taxicabs
of Absolute Reality,
I agree…… ridiculous complacency….or sheer terror and no idea what to do, as they are are all in, the CB’s rideing to the rescue..yet again.
This lot have always been bailed out.
Reality Sandwich coming very soon.
I just bought 400 calls on the DXD-the Nov16 $18’s
Yeah, they’re sitting on gold–must be scared sh*tless…
“This time could be different”==YES! The possibility is there–I seldom do any trading anymore…but when I do, I am not interested in scalping $423 and running home to tell Mom–I get leveraged up–for a big casino trade–all or nothing….
