Deutsche Bank toxic derivative losses

michaels

AFF8879 wrote: »

1) notional number is absolute, meaning many positions are offsetting
2) notional is the amount the contract is pegged to, the actual amount at risk (“market value”, or “mark to market”) is only a tiny fraction of this.
3) banks are so heavily capitalised these days - a DB failure would no doubt be serious but it would come nowhere close to triggering a collapse of the financial system.

AG47 wrote: »

So who takes the losses on those 45 - 50 trillion toxic derivative losss?

Keep reading point (2) until you understand it

parking_question_chap

AG47 wrote: »

So who takes the losses on those 45 - 50 trillion toxic derivative losss?

Yup, their clients are going to take a hell of a battering.
Crashmageddon.

Farmer_Johnson

AG47 wrote: »

So who takes the losses on those 45 - 50 trillion toxic derivative losss?

Losing on a 50 trillion notional derivative does not mean losing 50 trillion.

If you grossed-up the notional on many trading books it would be that sort of size, but the gains and losses are a tiny fraction of the notional, and virtually all are collateralised.

The gross mark to market does actually matter nowadays, for leverage and hence balance sheet reasons but that’s why we have processes like Trioptima compressing all the circular deals where A owes B who owes C who owes A.

The-Joker

Its everybodies savings account, pension everything

everything is interconnected

AG47

Malthusian wrote: »

Ah, "green shoots". A phrase most recently used by Baroness Vadera in 2009, for which she was roundly mocked and criticised. She said she saw "green shoots of recovery" at almost the exact bottom of the market (January 2009), and she was proved 100% correct by the ensuing 9-years-and-counting bull market.

Previously it was used by Norman Lamont in October 1991, again to much criticism. The 1990-91 recession ended that very quarter, proving Lamont 100% correct.

I don't advocate market timing, but if there's a recession and/or stockmarket crash on, and you have a load of cash which you're scared of putting into the market, and

1) a politician says they see "green shoots"
2) everyone else in politics and the media crucifies them for being delusional / out of touch,

past performance says that it's time to bash on the wine gums.

If "green shoots" was supposed to suggest delusional optimism, I think you need a better phrase.

Everybody is getting worried about the too big to fail German DB as it is actually failing.

AG47

speedspirit wrote: »

The problem gets worse when world GDP growth continues to decline which means there isn't a way to pay back all of the debt owed. Armstrong computer indictates the low for global GDP to be 2025. We ate getting close to seeing the music stop.

DB going down no doubt about that. Is it going to be the next Lehman moment?

Deutsche Bank Death Spiral Hits Historic Low.

https://wolfstreet.com/2018/12/20/deutsche-banks-death-spiral-hits-historic-low-european-banks-follow/


https://youtu.be/2Z0rLDc4h58

pantaiema

AG47 wrote: »

Everybody is getting worried about the too big to fail German DB as it is actually failing.

We have been hearing this news since two years ago. They still exist

AG47

pantaiema wrote: »

We have been hearing this news since two years ago. They still exist

They have been in a death spiral for over two years now,njust like the two years before Leyman moment

Thrugelmir

pantaiema wrote: »

We have been hearing this news since two years ago. They still exist

Like RBS. Too big to allow to go under (if they ever do). The German Government will bail them out. Meanwhile the balance sheet will continue to contract in size,

fun4everyone

AG47 wrote: »

They have been in a death spiral for over two years now

Yep, they are going bust - or there is going to be a very expensive bailout. I predict bust. Either way, centralised banking showing its failings yet again.