Skip to comments.How negative interest rates helped turn Deutsche Bank into a disaster
Posted on 07/29/2019 9:04:23 AM PDT by Moonman62
Germany's biggest lender is rapidly slashing jobs, it's losing a ton of money and the stock is trading near all-time lows.
Many of Deutsche Bank's problems are self-inflicted. It's been badly mismanaged. Deutsche Bank (DB) never fully cleaned up its crisis-era balance sheet. Restructuring efforts fell short. And its countless legal black eyes haven't helped matters.
But Deutsche Bank's struggles have also been amplified by something the 149-year-old lender never imagined, mostly because it had never happened before in modern history: negative interest rates.
In 2014, the European Central Bank wanted to boost the sluggish economy but interest rates were already at zero. The unconventional decision to take them into negative territory was aimed at encouraging growth and avoiding deflation, but it meant banks were charged a fee for parking their reserves with the central bank.
(Excerpt) Read more at cnn.com ...
...The unconventional decision to take them into negative territory was aimed at encouraging growth and avoiding deflation, but it meant banks were charged a fee for parking their reserves with the central bank....
The banks would have been better off just keeping their required reserves in the form of actual cash sitting unused, but safe, in their vaults. Of course, the German government likely wouldnt allow that rational strategy.
I guess thats one way to get rid of a central bank.
Somebody has to support the moslem hordes, 85% of whom are unemployable.
Maybe now is a good time to buy some of their stock. The symbol is DB.
I’m gonna talk to my broker and see how he feels about it.
Deutsche Bank is no more Germany's central bank than Bank of America is the U.S. central bank. The central bank of German is Deutsche Bundesbank.
It would appear that they stopped being CAPITALIST and became SOCIALIST.
A Capitalist is interested in making a profit.
A Socialist is interested in “sharing the wealth”
Capitalism will grow the pie.
Socialist will eat the pie, lick the plate and then demand more pie.
Yes, Buba is not amused.
I drove past their Jacksonville, FL office yesterday. Had a good laugh at seeing their flag flying below the US flag.
I think all tax rates should be adjusted to negative numbers.
Borrow $10,000, and a year later, pay back $9800.
The government will pay our way out of it! Government has unlimited money! Just print more! What could possibly go wrong??
On any given day in the last twelve years, I've had the same thought: "Maybe the bottom has been finally reached." But then, I waited an extra day. Sure enough...
Then they'd have to admit that lower taxes are better.
“Maybe now is a good time to buy some of their stock. The symbol is DB. Im gonna talk to my broker and see how he feels about it.”
If DB goes bankrupt, their stock becomes literally worthless ...
Coming soon to a country near you.
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