Deutsch Bank on Verge of Collapse?

there is no such thing as a soft landing in a cornered marketplace

Despite claiming $52 TRILLION “notional” value in derivatives (nearly all the money in the world) DB has posted a shattering loss and according to the IMF poses the most serious systemic loss to the financial system. Reports indicate that 29 DB employees were at the root of manipulating the LIBOR index which is used as the primary index for variable rate loans. Nobody has addressed the issue of whether adjusted payments should be scrutinized even while knowing that the index was rigged.

 

see http://www.visualcapitalist.com/chart-epic-collapse-deutsche-bank/

Nothing equals nothing. The fact is that DeutschBank allowed itself to be window dressing on bogus REMIC Trusts as though the DB trust department was managing the money for investors. Other than ink on paper, the trusts did not exist and neither did any assets of the purported trusts. DB led the way as a principal party in creating the illusion of “something” when in fact there was nothing at all.

Then DB executives took highly leveraged risks in betting on the bogus mortgage bonds (and other “asset-backed” securities) issued by those bogus REMIC Trusts. Then they papered it over with all kinds of complex derivative products — all of which were based upon the nonexistent ownership of the primary asset — loans. DB claims over $52 Trillion in “value” for those derivatives as a tier 3 asset (i.e., it is worth what management says it is worth). The current leverage ratio for DB is reported at 40x, which is just 2 points lower than Bear Stearns before it toppled over. The leverage is disguised as “sales” for which DB has subsequent liability. All of this was predicted and described by Abraham Briloff  in Unaccountable Accounting published by Harper and Rowe in 1972. Nearly all of these “trades” are merely devices to kick the can down the road, covering over losses that DB would rather not admit.

This situation reminds me of a scene long ago when I was working on Wall Street as a Trainee security analyst in the research department of a medium sized brokerage firm. One of the family partners came into our research department and told us confidently that despite all rumors to the contrary there would be no layoffs in our department. I think I had another job before he returned to his office just ahead of the layoff of the entire department 2 weeks later. My intuition told me that he was lying. On Wall Street it’s not the lying that is frowned upon, it is getting caught. My experience has taught me that the bigger the entity the bigger the lies and the more serious the systemic risk to the whole of society. That was in 1968-9.

At that time the crisis was the “paper crash” — meaning that Wall Street firms had “lost track” of the location and ownership of stock and bond certificates. Now they are filing “lost note” complaints like confetti. When you send a Qualified Written Request or Debt Validation Request, you get nothing unless you are already in litigation where suddenly “original” documentation pops up.

This time it is far more serious as the fortunes of many investors, banks and other institutions rely on the value of DB stock and promises to pay. The problem in 1968-1969 was addressed by “best guesses” and converting from a system where investors received actual certificates to a system where trades were recorded privately on the books and records of the brokerage houses and investors had to rely on the statements from their broker as evidence of their asset holdings.

But the systemic problem is the same. Today it is the notes and loan documents that are lost. The conversion to using a private record of transactions sounds like MERS today. And the claim to $52 Trillion in “notional value” is pure obfuscation. The total of all real money in the world is probably under $70 Trillion. So does DB own most or all of it? I don’t think so and neither does anyone else, which is why DB is in trouble. They got caught.

The report in the link above says that DB is in full crisis mode as DB tries to escape the death spiral that took down Lehman, Bear Stearns, Merrill Lynch and others.

The importance of these events goes far beyond the significance of DB itself. DB, whose stock is selling at 8% of what it was selling at in 2007, is unfortunately only a symbol of an epic disaster that is slowly unfolding. The fundamentals have changed. Nearly all “debt” that was created over the past 15 years is fatally defective — leaving enforcement only to the good graces of judges who are willing to overlook centuries of law governing the purchase and sale of negotiable paper.

The reason for the continuing weakness in economic systems around the world is that most of the money was sucked out of those systems. The method of the banks in achieving this non-heroic status is responsible for the continuing recession that is creating so much disturbance around the world. Leaders of those countries have been sucking it up in order to create a soft landing.

But here is what we know from history — there is no such thing as a soft landing in a cornered marketplace. The banks converted our economies from 85% reliance on manufacturing and services to an economy where half of the economic activity consists of trading securities back and forth — i.e., trading the same securities over and over again. That means that actual economic activity in the production and delivery of goods and services has declined from 85% to 50% and it is still dropping. The rest is smoke and mirrors. It is the belief or entanglements with the banks that keeps us from moving on, clawing back, and restoring household wealth to the only place that will actually generate real economic activity — the middle class and lower economic tiers.

Henry Ford proved the point spectacularly about 100 years ago when he doubled the wages of his workers — to the astonishment and dismay of his competitors. It was clear to everyone but Ford that he had obviously lost his mind. Despite that clarity that everyone agreed was the true way of looking at things, Ford’s move created the middle class and thus created a stable demographic who continue to buy what he was selling. In a short time, Ford was the dominant player in the marketplace selling automobiles and the “realists” were gone.

Until the middle class is restored (i.e., it gets back the money that was distributed away from them into the hands of a handful of men who had used their positions of influence to corner the market on money), the “recovery” will continue to be smoke and mirrors, the society will be disrupted and eventually companies that do rely on people to purchase their goods and services won’t have anyone to sell them to. And creating debt to cover the shortfall doesn’t work anymore. The middle class must have a pathway to financial security, not to financial ruin.

25 Responses

  1. they bought trillions of $$ in insurance policies on mortgages. betting on them to crash. please watch https://www.facebook.com/nytimes/videos/10150847273909999/

  2. Neil, if the investment banks short equity and securities from their trading account to customer accounts through principal transactions, all the whole telling consumers that the assets are moving higher and they should buy, buy buy… then short the ETF’s, removing most firm bids from the exchanges… there will be a soft landing, but only for the banks… lol sounds like 29 all over again.

  3. Eee Gads!! The natives are restless. Break out the fire hoses and riot gear!

  4. @David, you are so right David. sometimes i think this website is here just to piss us off more. Talk is very cheap and where is the action of our so called consumer protectors. Its every man/woman for himself. People the whole system is corrupt, if you want to keep throwing your money to false promises then i feel sorry for you.

  5. If you have a sale date and the notices have been coming from a third party like NDEx West,or a lawyer try calling your so called servicer and asking if they have a sale date on your property.

    See if they say yes or no,if no is it posted on a site like Nationwideposting?Or a dif site send them an email and ask why they have it on their site when the servicer,lender says there is no date?

    Wait for them to reply,the so called lender-servicer doesnt want anyone thinking they are doing this and the third party will now know your hip to their sham and hopefully cancel the sale.Give it a shot and see just how they have tricked millions of homeowners into walking away and also how any lawyer who says they are working for you is full of sh.t.

  6. there is more money due on derivatives than there is in the entire world economy. that is a crazy thought. i think we need a major reset. it is sad that they think throwing us out of our homes is going to make them rich when the opposite is true. it is a ponzi scheme at some point the derivatives will not be able to get paid. what happens then?

  7. The entire thing is a sham,every single level of this and every single lawyer,judge,trustee,realtor,title company,elected official,regulatory body all know that this whole mess is pure bullshit.

    There is no way to enforce any so called loan from that era thats been securitized,all paid in full ,unsecured,so any lawyer that you talk to and claim that they will help you ,they are lying,they want your money and thats it.
    The trustee has no authority to move on your home,plus its paid in full,they will pretend to have authority,standing,etc,they do not.

    I dont trust any one or any lawyer,or bank,they can kiss my ass,and this site as well,all bullshit.

  8. I think the banks will go down, because the derivatives are all bogus and illegal. The currency reset is going to have great effects on the banks, too. We live in very exciting times.

  9. @ louise ,

    I don’t see DB going down ,, they’re too connected and will be protected at ALL costs ,, even to the point of a initiating a systemic meltdown… Most of DB’s problems are counterparty risks associated with derivatives… if DB cannot be saved by the ECB (or our FED and their puppet the BOJ) the problem asset (derivatives) will be declared VOID and unenforceable as unlicensed insurance products without proper reserves backing them…. they’ll be litigated to death over the course of decades and in the end only the lawyers will gain anything from them. That’s my prediction and I’m sticking with it…

  10. DB also stands for dead body. Once Deutsche Bank goes down, then the others will follow.

  11. Go, Michael. Still love your posts. Keep up the good work. Something has got to give before November. I am waiting with baited breath.

  12. MS has been here before, many times before. Beware! Do not waste your time trying to figure out what he is trying to say. Waste of time and space.

  13. American indifference to the parasitic, criminal fraud, currently athwart the financial system of the United States, is a luxury, We The People can no longer afford.

    Moreover, the English-based, central banking Cartel, is presently: “Insolvent”.

    The amount of money they owe, to the system they hijacked, has rendered them, now and forever, beyond salvage (Google 1200 Trillion Dollars and derivatives).

    1200 Trillion is 20 X the combined GDP of every country on the planet: an impossible sum.

    A “derivative” is a type of “short sale bet”; a bet something will fail.
    It is a “bet” that attempts to trade the “liability (the loss)” on any given deal.

    A “short sale bet” is when you borrow money to buy a thing low to sell it high, later.

    A “Naked, short sale bet” is when you borrow to buy low…

    and sell high, later…

    On something you never owned in the first place…

    BORROWED MONEY… TO BET … ON SOMETHING YOU DON’T OWN…

    And couldn’t possibly own, because it belongs to someone else.

    In a word: “Counterfeiting”.

    The US is currently engaged in a “War on Terror” and a “War on Drugs”.

    Bank of America, Wells Fargo and HSBC (an English-Chinese hybrid- “Hong Kong, Shanghai Banking Corporation”) have already admitted to laundering “Terror and Drug Cartel money”.

    In a word: Treason.

    American GIs have suffered and died in “The War on Terror” and “The War on Drugs”.

    The criminals within the intentionally mislabeled, “Federal Reserve (neither “federal”, nor possessing ANY “reserves”) and the politicians that are concealing they are imposters, in the first place, have ruined themselves…

    THEY HAVE RUINED THEMSELVES

    NOT US.

    These criminal “bets” belong to them, not the American People!

    There is no mechanism, whatsoever, within Article 1, Section 8, that describes a foreign, criminal, privately-owned and operated parasite is allowed to manipulate “the Good Faith and Credit” of We The People.

    The funny money they have designed, as a deliberate attack on American Sovereignty (through hyper-inflationary, “Federal Reserve Notes” and the “Treasury bonds” that act as “security” for those “Federal Reserve Notes”), is a Fraud that belongs in their name, not ours!

    1200 Trillion Dollars!!!!

    The deliberate attack on American Sovereignty, through forgery and fraud, is designed to capitalize on 1200 Trillion Dollars worth, of “Naked Short Sale Bets” that are aimed directly at American Home Ownership.

    Instead of borrowing money to “bet” on a horse they don’t own…

    The criminal, English-based, central bankers borrowed money to “bet”…

    On houses they don’t own.

    They are betting they can seize houses they never owned through forgery on the title to those homes and fraud as it pertains to counterfeiting.

    MORE IMPORTANTLY, COLLECTIVELY – ALL THE BANKS – ARE BETTING THEY CAN COLLECT 1200 Trillion Dollars, THROUGH COUNTERFEIT CLAIMS OF OWNERSHIP, ON “NAKED SHORT SALE BETS”!

    They are betting they can counterfeit ownership long enough to profit from foreclosures they created, in the first place.

    The banker’s criminal behaviors are legion: phony modifications, dual-tracking, robo-signing (forgery), pension theft, LIBOR, laundering drug and terror cartel money!

    The 1200 Trillion they owe to these behaviors are not some delusion of “Keynesian”, “deficits don’t matter”, or equally preposterous, “unfunded LIABILITIES”.

    Instead, these are very real dollars owed to very real, inter-bank, criminal behaviors.

    THE ANSWER: CONFISCATE BANK ASSETS; NATIONALIZE THE BANKS.

    THE ANSWER: RELEASE A NEW ISSUE OF ABE LINCOLN’S GREENBACKS, AS PRO-RATED UPON A SEIZURE OF OUTSTANDING, HYPER-INFLATIONARY, CRIMINAL, “FEDERAL RESERVE NOTES” AND THE TREASURY BONDS THAT SECURE THOSE DEBTS.

    Investigate and jail the bankers.
    Investigate and jail the media as a full-blown foreign propaganda.
    Investigate any jail politician that will not admit the “Federal Reserve” is an imposter.

    Senator Sanders is the only political candidate that has expressed his intention to disrupt and investigate the banks.

    Senator Sanders, We The People and Abe Lincoln’s Greenback dollar 2016.

    I don’t believe, beyond window dressing, Senator Sanders truly endorses Clinton. I have been wrong before; PBO as a great example. However, Senator Sanders must continue in supporting the criminal, Clinton, or he will lose his D certification.

    I will be in Philadelphia. I encourage every true patriot to come along.

    If Clinton is to be trusted: show the wall street speeches…
    If Trump is to be trusted: show the tax returns.

  14. @Neidermeyer,

    I apologize. I feel PBO is at least as useless and dangerous as you once described.

    It has taken me some time to recognize his status as “Judas Goat”.

    I don’t agree he is w/o birth certificate. I don’t agree with the phony Fox News Gang. I do realize he is, without question, a puppet of the criminal, English-based, central bankers.

    Mike Keane

  15. @ Maher Soliman ,

    I get your basic argument … but I don’t see how it could be concealed for so long (yet another fraud layer makes my head hurt)… Surely an audit of one of the failed S&L’s or their successors would show the notes being exchanged for commercial paper using the 1031 “like kind” method to move a gargantuan amount of “boot” (cash money from the end sale to investors) to create the “dark pools” that powered the mortgage lending ,, and it makes sense of the shredded notes immediately after signing and generally not caring about the legality of anything on the borrower end of the transaction…

    It makes sense to me to incorporate this methodology if I was building this fraudulent empire as REMICS are legally allowed to sell forward unlike REITS.. It simplified the only thing Wall Street cares about .. money extraction while destroying the information trail….

    Is there an IRS letter allowing or encouraging these exchanges for this purpose? What bothers me (just a little) is that like/kind exchanges of bad notes , unlisted stocks and other garbage collateral was the method used by S&L’s to boost their book with the help of similarly afflicted S&L’s … I don’t see the IRS endorsing it.

    Have you seen any financial institutions books first hand that used the 1031 exchange for this purpose? If so how did you gain access? I don’t doubt you but I don’t know how to use it… I see this hidden behind the wall street curtain of “proprietary trading” ,, we’ve all seen the ridiculous reports of hundreds of days of gains from “proprietary trading” with never a day of loss from all the players… The SEC “watchdogs” will never allow us to see what’s behind the curtain. I have a strong gut feeling you’re correct but I see this as something we cannot prove and the core secret that will always be protected by the banks/gov’t/federal reserve ,,, they’ll admit to all kinds of fraud related to enforcing the notes but not in extracting monies…

  16. […] Deutsche Bank on Verge of Collapse? […]

  17. I don’t know about others here, but I sure do wish Mr. Soliman could explain his thoughts better. Is English a 2nd language for him? Seems there’s something there, just not able to remotely tell what it is. He does seem to be explaining complex issues to us non-accountant types, however, so that is likely part of the issue. Is there anyone here who understands and could possibly translate to common language?

  18. You know we cant just let this drop
    Its just so unbelievable
    People … We are on the tax hook for all of it
    Their game will affect the price of everything
    I wish i could stop being pissed but i am.

  19. in response ro Rhody,

    on July 12, 2016 at 10:39 am said:
    Talking about bogus REMIC Trusts, one could say these.
    During the housing bubble, banks bought loans from originators, and then in a process known as securitization enacted a series of transactions that would eventually pool thousands of mortgages into bonds, sold all over the world including to public pension funds, state and municipal governments and other investors.
    Some of the assignments of mortgages may be outright fraudulent and void creating bogus securities which is a federal crime. So, when the pension funds, states and municipal governments do find them out of no annual percentage yield on their money invested, what could they do? NOTHING MEANS NOTHING? What about foreclosure?
    Home owners many need to complain to the the Treasury Department and even Federal Reserve to get justice in the void assignments of mortgages as these agencies may also have paid for the transfer of bogus and defective assignment of mortgages.;

    what about when the tile is on mers?

  20. Talking about bogus REMIC Trusts, one could say these.

    During the housing bubble, banks bought loans from originators, and then in a process known as securitization enacted a series of transactions that would eventually pool thousands of mortgages into bonds, sold all over the world including to public pension funds, state and municipal governments and other investors.

    Some of the assignments of mortgages may be outright fraudulent and void creating bogus securities which is a federal crime. So, when the pension funds, states and municipal governments do find them out of no annual percentage yield on their money invested, what could they do? NOTHING MEANS NOTHING? What about foreclosure?

    Home owners many need to complain to the the Treasury Department and even Federal Reserve to get justice in the void assignments of mortgages as these agencies may also have paid for the transfer of bogus and defective assignment of mortgages.

  21. No middle class equals nobody to buy the manufacturing sector’s products and services. It does not work. Looking forward to the alleged currency reset.

  22. amen Neil, Dont bite the hand that feeds you. i know there is one less middle class person here

  23. ECB helicopter money is on the way NOW!

  24. Neil– thank you for all you are and do. Do you know the implications w/DB and if (they pretend) to own your mortgage in a trust? What is your prediction? Just curious! Thank you. Xox debi (a long time follower of your work)
    Sent via BlackBerry from T-Mobile
    ________________________________
    From: Livingliess Weblog
    Date: Tue, 12 Jul 2016 12:31:15 +0000
    To:
    ReplyTo: “Livinglies’s Weblog”
    Subject: [New post] Deutsch Bank on Verge of Collapse?

    Neil Garfield posted: “there is no such thing as a soft landing in a cornered marketplace Despite claiming $52 TRILLION “notional” value in derivatives (nearly all the money in the world) DB has posted a shattering loss and according to the IMF poses the most serious systemic “

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