The Deutsche Bank Death Watch Has Taken A Very Interesting Turn

themostimportantnews.com ^ | November 5, 2019 | Michael Snyder

[LesbianThespianGymnasticMidget]

The biggest bank in Europe is in the process of imploding, and there are persistent rumors that the final collapse could happen sooner rather than later. Those that follow my work on a regular basis already know that this is a story that I have been following for years. Deutsche Bank is rapidly bleeding cash, they have been laying off thousands of workers, and the vultures have been circling as company executives desperately try to implement a turnaround plan. Unfortunately for Deutsche Bank, it may already be too late. And if Deutsche Bank goes down, it will be even more catastrophic for the global financial system than the collapse of Lehman Brothers was in 2008. Germany is the glue that is holding the EU together, and so if the bank that is right at the heart of Germany’s financial system collapses, the dominoes will likely start falling very rapidly.

There has been a tremendous amount of speculation about Deutsche Bank over the past several days, and so let’s start with what we know.

We know that Deutsche Bank has been losing money at a pace that is absolutely staggering…

Deutsche Bank reported a net loss that missed market expectations on Wednesday as a major restructuring plan continues to weigh on the German lender.

It reported a net loss of 832 million euros ($924 million) for the third quarter of 2019. Analysts were expecting a loss of 778 million euros, according to data from Refinitiv. It had reported a net profit of 229 million euros in the third quarter of 2018, but a loss of 3.15 billion euros in the second quarter of this year.

If you add the losses for the second and third quarter of 2019 together, you get a grand total of nearly 4 billion euros.

How in the world is it possible to lose that much money in just 6 months?

If all they had their employees doing was flushing dollar bills down the toilet for 6 months, it still shouldn’t be possible to lose that kind of money.

When investors learned of Deutsche Bank’s third quarter results last week, shares of the bank went down about 8 percent in a single day.

Overall, the stock price has lost over a quarter of its value over the past year.

Unless you enjoy financial pain, I have no idea why anyone would want to be holding Deutsche Bank stock at this point. As I have previously warned, it is eventually going to zero, and the only question remaining is how quickly it will get there.

We also know that Deutsche Bank has been laying off thousands of workers all over the world…

On July 8, 2019, thousands of Deutsche Bank employees across the globe arrived at their offices, unaware that they would be leaving again, jobless, just a few hours later. In Tokyo, entire teams of equity traders were dismissed on the spot, while some London staff were reportedly told they had until 11am to leave the bank’s Great Winchester Street offices before their access cards stopped working.

The job cuts, which totalled 18,000, or around 20 percent of Deutsche Bank’s workforce, were the flagship element of a restructuring plan designed to save the ailing German lender.

The day before those layoffs happened, most of those employees would have probably told you that Deutsche Bank is in good shape and has a very bright future ahead.

Just like we witnessed with Lehman Brothers, there is always an effort to maintain the charade until the very last minute.

But the truth is that anyone with half a brain can see that Deutsche Bank is dying. There have been so many bad decisions, so many aggressive bets have gone bad, and there has been one scandal after another…

In April 2015, the bank paid a combined $2.5bn in fines to US and UK regulators for its role in the LIBOR-fixing scandal. Just six months later, it was forced to pay an additional $258m to regulators in New York after it was caught trading with Myanmar, Libya, Sudan, Iran and Syria, all of which were subject to US sanctions at the time. These two fines, combined with challenging market conditions, led the bank to post a €6.7bn ($7.39bn) net loss for 2015. Two years later, it paid a further $425m to the New York regulator to settle claims that it had laundered $10bn in Russian funds.

At this point, it is just a zombie bank that is stumbling along until someone finally puts it out of its misery.

Money is so tight at Deutsche Bank that they have even cancelled the Christmas reception for retired employees…

Times change. Once upon a time (2001, in fact), Deutsche Bank was able to book stars like Robbie Williams for its staff Christmas party, with a Spice Girl turning up too just because it was such a great party. Now, according to the FT, Christian Sewing has even cancelled the daytime coffee-and-cake Christmas reception for retired employees.

Of course saving a few bucks on coffee and cake is not going to make a difference for a bank with tens of trillions of dollars of exposure to derivatives.

Deutsche Bank is the largest domino in Europe’s very shaky financial system. When it fully collapses, it will set off a chain reaction that nobody is going to be able to stop. David Wilkerson once warned that the financial collapse of Europe would begin in Germany, and Jim Rogers has warned that the implosion of Deutsche Bank would cause the entire EU to “disintegrate”…

Then the EU would disintegrate, because Germany would no longer be able to support it, would not want to support it. A lot of other people would start bailing out; many banks in Europe have problems. And if Deutsche Bank has to fail – that is the end of it. In 1931, when one of the largest banks in Europe failed, it led to the Great Depression and eventually the WWII. Be worried!

Sadly, most Americans can’t even spell “Deutsche Bank”, and they certainly don’t know that it is the most important bank in all of Europe.

But those that understand the times we are living in are watching Deutsche Bank very carefully, because if it implodes global financial chaos will certainly follow.

[Paladin2]

What month will this occur?

[jimmygrace]

reasons for the collapse?

[Steely Tom]

You can take your pick:

Deutsche Bank tells court it has tax returns tied to Trump family businesses; The Hill, 27 August 2019.

Deutsche Bank Does Not Have Trump’s Tax Returns, Court Says; The New York Times, 10 October, 2019.

[pepsi_junkie]

Financial derivatives have threatened the global economy several times. Long Term Capital Management in the 90s, the 2008 crash, now this. Financiers think they have cracked the code to yield unlimited profit by taking counter positions on both sides using derivatives, all upside and no risk. Then something unexpected happens, something their math didn't forsee, and they are screwed.

It should be clear by now that massive reliance on them is playing with fire but I guess the potential upside is like crack, they can't stop themselves.

[ryderann]

How many Deutsche Bank executives have committed suicide over the past several years? Lots of funny business going on there.

[jimjohn]

Bookmark for later.

[deadrock]

Sadly, most Americans can’t even spell......

All part of the plan.

[GOPJ]

Trump pulled us away from much global inter-dependency - and just in time.

Where will all the frightened money go? To the US...

Then again if this is a full collapse we can thank our lucky stars Trump is President... he’s one of the few people in the world who will have a clue how to steer us though this mess...

[pepsi_junkie]

From another article: "Deutsche Bank created over the years a whopping $53.5 trillion (€48 trillion) book of derivatives contracts that it now is seeking to unload, but experts say getting rid of those assets is no easy task."

I imagine it's hard to sell the thing the anchor around your neck which is dragging you to your death. Financial derivatives, they were gambling. Not really, they buy securities and then buy a counter investment in a derivative so that they win either way the market goes. That's the theory. The derivatives have massive downside though so if you get it wrong in your math models, you are shafted. I'm not sure what they got wrong but another such crisis was the Long Term Capital Management one in the 1990s. They didn't foresee the crisis in Asia and were heavily invested in derivatives based there. They almost tool out all of Wall Street and had to be bailed out by the fed (by us, actually).

[Steely Tom]

The derivatives have massive downside though so if you get it wrong in your math models, you are shafted.

Don't worry, convolutional neural networks have it all figured out.

[edwinland]

Clickbait headline.

I missed the part where the death watch “takes an interesting turn”

There’s no interesting turn here. Unless you count cancelling the staff Christmas party, which is hardly “interesting” and actually pretty much expected.

[pierrem15]

Just like we witnessed with Lehman Brothers, there is always an effort to maintain the charade until the very last minute until the bigwigs can cash out.

Fixed it.

[Buckeye McFrog]

IMHO a very bad omen. I have always said that the one thing that could catapult Lizzie Warren into the White House is if the banks SCROOOOOOOOOO-up in a major way before the election, putting voters in the mood to punish them.

[BenLurkin]

This is big news. If that bank goes under, it will have “ripple effects” all the way to the USA.

[DoodleDawg]

reasons for the collapse?

High risk investments coming back to bite them.

[Captain Peter Blood]

DB is too big to fail and the German government will do whatever to bail them out like we did we our banks in 2008.

DB stock will skid to pennies and that is when it “might” be a buying opportunity. I still kick myself for not buying Citibank when it was $0.50 a share.

[Liz]

ITEM-—In 2013, James Comey became a board member, a director, and a Financial System Vulnerabilities Committee member of the London bank HSBC Holdings.

“Mr. Comey’s appointment will be for an initial three-year term which, subject to re-election by shareholders, will expire at the conclusion of the 2016 Annual General Meeting,” according to HSBC company records.

HSBC Holdings and its various philanthropic branches routinely partner with the Clinton Foundation.

For instance, HSBC Holdings has partnered with Deutsche Bank through the Clinton Foundation to “retrofit 1,500 to 2,500 housing units, primarily in the low- to moderate-income sector” in “New York City.”

---

WIKI Comey served on the board of directors of HSBC Holdings until July 2013.In September 2013, President Barack Obama appointed Comey to the position of Director of the FBI.[7] In that capacity, he was responsible for overseeing the FBI’s investigation of the Hillary Clinton email controversy. Comey received heavy criticism from Republicans after it was revealed that he had begun drafting an exoneration letter for Clinton before the investigation was complete.

[AAABEST]

There’s no interesting turn here. Unless you count cancelling the staff Christmas party, which is hardly “interesting” and actually pretty much expected.

I actually agree with you. That said, cancelling stuff like Christmas parties and picnics is a tell-tale sign that a company is going under.

There are other red flags, like losing key people to layoffs and suicide.

[dfwgator]

There are other red flags, like losing key people to layoffs and suicide.

Second Man: That was Wilkins. He was a good, good, er, golfer, Wilkins.

First Man: Very good golfer. Very good golfer. Rotten at finance. It'll be Parkinson next.

Second Man: Bet you it won't.

First Man: How much.

Second Man: What?

First Man: How much do you bet it won't? Fiver?

Second Man: All right.

First Man: Done.

Second Man: You're on.

First Man: Fine. (shakes; they look at the window) Come on Parky.

Second Man: Don't do it Parky.

First Man: Come on Parky. Jump Parky. Jump.

Second Man: Come on now be sensible Parky.