Deutsche Bank toxic derivative losses

danthemoneysavingman

Why do you think the entire global financial system will be allowed to fail?
I'm sure the other institutions in the market, and governments, would go to lengths to stop that from happening.
I am not these institutions or governments however so I cannot expand on that directly, but when the UK system was near collapse, the government stepped in, as an example.

AG47

danthemoneysavingman wrote: »

Why do you think the entire global financial system will be allowed to fail?
I'm sure the other institutions in the market, and governments, would go to lengths to stop that from happening.
I am not these institutions or governments however so I cannot expand on that directly, but when the UK system was near collapse, the government stepped in, as an example.

Exactly, this is what I have been saying all along.

Excellent post right on the mark instead of trying to distract from the issue.

What steps can they take? There is either a bail in, using depositors funds, but it's still not enough.

They would also need to try to get another bailout through, but after all the banker bailouts from the 2008 GFC 1.0 the people will not stand for it again.

So what other options are there?

bengalknights

DB wont fail, The German state will take it on and break it up into good and bad banks similar to RBS, Northern Rock, Abn Amro etc

AG47

bengalknights wrote: »

DB wont fail, The German state will take it on and break it up into good and bad banks similar to RBS, Northern Rock, Abn Amro etc

They already tried that, but fifty trillion is just far to big a derivative problem.

Note it's 50 Trillion with a T, not Billion with a B!!!!!!!!!

They also tried merging earlier this year, but they realised that merging an enormass terd with small turds you just end up with an even bigger turd problem.

chucknorris

AG47 wrote: »

Once again I'm interested because DB are a too big to fail bank, meaning if they fail then the entire global financial system will fail.

So are you admitting they are in serious trouble but you don't think they could collapse?

Is your reasons because you don't think the global financial supystem will be allowed to collapse?

How do you think the collapse will be prevented?

I have no opinion on whether they will collapse or not, and I don't intend to waste any of time to forming such an opinion. I have got more important things going on that take priority.

mayonnaise

I think the answer is 'buy silver'.

Out,_Vile_Jelly

AG47 wrote: »

V

My answer is I just don’t know, but I’m not burying my head in the sand.

So what's the point in banging on about it? I have more respect for people who commit to living off a small-holding and learning some post-apocalypse skills than those who just get hysterical on the internet.

AG47

Out,_Vile_Jelly wrote: »

So what's the point in banging on about it? I have more respect for people who commit to living off a small-holding and learning some post-apocalypse skills than those who just get hysterical on the internet.

Sounds like another way of saying bury your head in the sand.

So far there has been a lot of effort on this thread to either try to change the tune, distract or misdirected attempts.

What's the point of banging on about any single subject on these forums?

If you feel this way then why even read or participate on this economy debate board?

Why not keep comments back on topic, what will happen to the 50 trillion derivative problem now that DB is collapsing?

AG47

westernpromise wrote: »

Your fifty trillion was debunked long ago upthread. Absolutely nobody is interested in DB apart from you. Why are you obsessed with DB? Is it because you want a bank - any bank - to default on imagined debts, to give you permission to default on yours?

You've been predicting DB's collapse for three years. Do you think you might be wrong, at all?

It's not my fifty trillion number, it's the actually correct number.

Do you dispute that the derivative problem is nudging fifty trillion?

Where do you think the financial press have got it wrong all reporting its about fifty trillion?

What do you think the correct number is? Obviously it depends which currency you are measuring it in, and yes they are all fluctuating.

The question is whether Germany’s biggest bank, with its share price cratering and a derivatives book nudging $50 trillion, can continue to shrink that footprint gradually, smoothly and with minimal market disruption?

They have been trying to since this thread started a few years ago but the problem keeps getting worse and the share price keeps tumbling.

westernpromise

AG47 wrote: »

It's not my fifty trillion number, it's the actually correct number.

Do you dispute that the derivative problem is nudging fifty trillion?

Yes. As I said in #652, If you trade in a £5,000 car to buy a £5,050 car, have you got a £10,050 exposure to cars? Or a £50 exposure?

DB's 2018 accounts (https://www.db.com/ir/en/download/Deutsche_Bank_Annual_Report_2018.pdf - page 238/448) show Negative market values from derivative financial instruments 301,487 (in millions of euros). DB has net equity of $70 billion.

In comparison JPM's equivalent trading liabilities figure is $144 billion (https://www.jpmorganchase.com/corporate/investor-relations/document/audited-financial-statements-2018.pdf - page 5/152) and equity is $256 billion.

So DB has about $200 billion more trading liability than JPM and also about $200 billion less net equity.

So what? This is telling us nothing we don't already know, which is that DB isn't a very good bank. If their trading exposure was similar to JPM's so would their net equity position be.

Are you confusing notional with net? You are, aren't you?