Deutsche bank collapse/Financial crash imminent

[Throatpunch]

• https://www.rt.com/business/360917-deutsche-bank-lehman-crisis/
• http://www.telegraph.co.uk/business...risis-could-take-angela-merkel-down--and-the/
• http://www.telegraph.co.uk/business...e-next-lehman-brothers-the-denials-certainly/

As I have been saying for years, Deutsche bank looks like it will fail, and this could be like Lehman Brothers on steroids, causing 5 times the damage.

Some say financial crisis is on the way:

• http://www.thisismoney.co.uk/money/...ite-central-banker-predicted-2008-crisis.html
• http://www.independent.co.uk/voices...spread-around-the-world-economy-a7030146.html

 

[Atomkilla]

Of course not. When have the Germans caused the world crisis?

 

[Crni Vuk]

Of course not. When have the Germans caused the world crisis?

The German bank has nothing to do with Germany. It's just a brand. Nothing more, nothing less. And the Bank is so rotten to the core ... if it goes down, the world won't loose much. We would actually gain something.

 

[SuAside]

if it goes down, the world won't loose much. We would actually gain something.

Deutsche Bank, like banks like it, is federally protected in the countries it operates in.
For instance, all client deposits in Belgium are backed by the Belgian state up to 100.000 euros. If Deutsche Bank goes down, it WILL cost our countries A LOT of money.
It's also unlikely that the German state would even allow Deutsche Bank to fail entirely and will likely buy it out to prevent total collapse. It kinda makes sense since buying the bank (and thus giving it government backing and no more risk of it failing) often ends up cheaper than having to pay out the "protected" deposits to the clients...

 

[Crni Vuk]

Who will really lose something in the end? If you're worried about the despositors, they can be secured. If this is really just a money problem, then I am not worried even one inch. This whole shit show has to colapse finally anyway, so we can start over again. No clue why the people always get in panic mode when banks go down. The Deutsche Bank in particular has been dealing in many very shady practises and business methods. Like I said, we won't lose much if they go down.

 

[SuAside]

Where do you think those secured deposits will be paid from? The state coffers. And to do so, we'll get into even more state debt. And who pays for that? The people who pay taxes.

That's all a fuckton of money which could have been spent on tax cuts or useful goals. Now we're set to pay for bad business practises outside of our own control.

 

[Crni Vuk]

No, why do they have to be 'paid' by anyone? Just secure the money from usual deposits and tell the investors wo run off with the profit to fuck off. That simple. The issue isn't the money. The problem is when ever our governemnts decide to support banks, then it's not for the deposits, but for the investors and crditors so they can bail out with their billions in profit, while the shitty decisions and investements they made remain as debts in public hands. Basically what happend in Greece with all of those financial issues, where EU just pumped enough money in to all of it, so that private investors could run away with their profits. Just let the fuckers who use banks as gambling game dry out, the changes could be all made tomorrow with the correct laws. This is a political issue because of the strong lobbyism, and not one of money, because the money is actually there. It's just in the wrong hands.

Again, if the bank goes down, it goes down, as long we don't allow the debt holders to bail out again with tax money, we will be fine. The deposists could be transfered and secured like, yesterday without any issues for the 'normal' people.

 

[valcik]

Sua is right, the state would have to pay the minimal amount of money guaranteed by law to every client of any insolvent bank. This would be paid from taxpayers' money. You can't "secure the money" before the bank went bankrupt.

edit: As for Greece, you are right. This is the reason why Slovakia was against saving Greek debts from the very beginning actually - almost 80% of bail-out money went back to German and French investors owning Greek debt, that's why we've insisted Greek banks should've bankrupt four years ago.

 

[Crni Vuk]

Sua is right, the state would have to pay the minimal amount of money guaranteed by law to every client of any insolvent bank. This would be paid from taxpayers' money. You can't "secure the money" before the bank went bankrupt.

Why? Why not. This is really not rocket science. It's not like the parliments and politics couldn't make the necessary laws to protect usual depositors and also forcing the investors and anyone who earned a fortune from those risky business practises to be liable with 'their' income.

Again, this isn't a question of money, it is one of lobbyism. But if we continue to treat banks the same we did for the last 15-20 years and treating the financial market like a sacred cow, then yes you are right it will always cost the tax payers a fortune.

THe moment you make the investors who earned a high profit with their risky deals, liable you can lower the debts for the normal person. Where are those milionairs and others that made a fortune with their fonds and gambles? Make them liable, start investigations, but some SERIOUS(!) ones - it's obviously possible! As we've seen with journalists geting their hands on all those off-shore papers, and then see what happens. If those banks lost a lot of money, then someone, somewhere must have earned a fuck ton of money with those deals. Taxing them or getting somehow on that money, would be like, no problem if you made the correct laws. Why is it that we always talk about the debts and problems for the 'normal' and 'small' people, like as the rich people don't exist in this system.

And that is the true problem. Not what ever if those banks go bancrupt or not, fuck them if they can't make correct deals and work, let them drown. But you won't see a politican make some serious changes to the financial sector for the same reason as whey they don't increase the tax on capital gains, making some serious limitations and changes to the financial sector, and why we still have a limit on taxation when you earn a fuck ton of money, where it doesn't matter how much you earn, the taxes will not grow.

 

[valcik]

Where are those milionairs and others that made a fortune with their fonds and gambles? Make them liable, start investigations, but some SERIOUS(!) ones - it's obviously possible!

They're controlling our politicians actually. There's such éminence grise hiding behind each of our politician party, funding them and sponsoring their campaings, choosing their own delegates and pushing them towards our parliament as a candidates for future elections. You really do believe in honest and transparent democracy, don't you? Well, I've got news for you, what are you proposing is that these capitalists would issue laws against themselves. Not going to happen.

Anyway, Deutsche Bank is not going to bakrupt yet. They do have some reserves and they're not depleted.

 

[SuAside]

No, why do they have to be 'paid' by anyone? Just secure the money from usual deposits and tell the investors wo run off with the profit to fuck off. That simple. The issue isn't the money. The problem is when ever our governemnts decide to support banks, then it's not for the deposits, but for the investors and crditors so they can bail out with their billions in profit, while the shitty decisions and investements they made remain as debts in public hands. Basically what happend in Greece with all of those financial issues, where EU just pumped enough money in to all of it, so that private investors could run away with their profits. Just let the fuckers who use banks as gambling game dry out, the changes could be all made tomorrow with the correct laws. This is a political issue because of the strong lobbyism, and not one of money, because the money is actually there. It's just in the wrong hands.

I'm not sure you realize how banks work. The deposits are not "there", they are figures in a computer that are a tally of how much money you deposited. The actual money has been invested or loaned out. Only a minimum of liquid assets have been kept inside the bank to be able to deal with demand for withdrawals and to have some financial reserves. (this is why a "bank run" can kill a bank)
The other money is invested and quite often in investments which cannot be withdrawn at will or which can be withdrawn but at great loss.
As for getting money from debtors who took out a loan from the bank, well, that's nigh impossible? The debtors by definition did not have the money to pay for their own loan or else they wouldn't have taken out a loan? Forcing debtors to refinance their loan elsewhere and pay back their loan immediately would be both a breach of contract and quite a legal pickle. Doing so would destabilize our entire banking system far far worse than what would happen from a failing bank.
It also doesn't help that our current banking system allows banks to loan out more money than has been deposited... Yes, that money is created out of thin air and it is backed by central banks (or other normal banks). 35% of european banks loan out more than the deposits they actually hold.

 

[Crni Vuk]

Sua ... money is always the excange of debts and credits. Someones debts are someone else credits. I start to repeat my self ... the laws to get your hands on the money of those gamblers, like as I mentioned, the people that gained money from those shitty deals could be made like yesterday. You don't have to even touch the deposits of the 'small' fry here that had absolutely no conection to the gambling schemes of the banks.

But no one ever will get on those fonds and the money of the share holders for the same reason why no one bothered to tax the rich in Greece.

 

[SuAside]

But a bank gets into problems because it made bad investments, made insolvent loans, has too high operating costs (salaries to the worker bees and for infrastructure) and siphoned off profits. Sure, you can get money back from siphoned off funds, but that's a tiny amount compared to the losses from bad investments and worthless junk loans? That money will invariably have to be paid by the state if the bank fails.

The operating costs are gone. No way to practically or legally recuperate that.

As for the siphoned profits... Even if you can prove anything and eventually get it back, this will take decades of court battles to return only a fraction of this money. So in the meantime, it's yet again the tax payer who will be paying for it?

Money is debt & credit, sure, but an untrustworthy loan for 1 million dollars can be overvalued by the failed bank and only a fraction of that loan might be recuperable if that junk loan is transferred to a different bank. That is what we have seen in the banking crisis. Usually the failed bank got split into two parts. One part with healthy assets and another with overvalued junk backed by the state. For every junk loan which is defaulted on, it's the state that has to step in with tax payer money to keep the "bad bank" from going bankrupt...