European Banks Crash For 4th Straight Week

[Rizla2345]

Even with today's 3% surge - the most in a month - on the heels of Unicredit's CEO proclaiming that EU banks are "intensely" looking for fundin solutions, European banking stocks have collapsed for a 4th straight week for the worst losses since 2012.





Following the brief exuberance after Draghi unleashed his latest bazooka - which it seems was all front-run - European banking stocks have collapsed almost 20% - the biggest loss since April 2012.

http://www.zerohedge.com/news/2016-04-08/european-banks-crash-4th-straight-week

[1713555978]

1713555978

[1713555978]

1713555978

[1713555978]

1713555978

[yenxz]

Even with today's 3% surge - the most in a month - on the heels of Unicredit's CEO proclaiming that EU banks are "intensely" looking for fundin solutions, European banking stocks have collapsed for a 4th straight week for the worst losses since 2012.





Following the brief exuberance after Draghi unleashed his latest bazooka - which it seems was all front-run - European banking stocks have collapsed almost 20% - the biggest loss since April 2012.

http://www.zerohedge.com/news/2016-04-08/european-banks-crash-4th-straight-week

European banking stocks have collapsed for a 4th straight week for the worst losses since 2012

give us the source that this is really happen,and i can't believe that Europan banks can crash like this,since 4 years, is this one of many effect of bitcoin? tell me something

[Rizla2345]

It's not only German banks (DB and its 10x EU's GDP derivatives exposure) http://independenttrader.org/deutsche-bank-on-the-brink-of-bankruptcy.html but also Italian banks (Banco Popolare and Banco Popolare Di Milano) are going down. Draghi may be busy printing money to bail out 2.0 but helicopter money can prevent riots - maybe. http://independenttrader.org/the-most-important-events-of-march-2016.html#comment-93

[BitsandBites]

Europe got a little crisis going on. The problem is Brexit. If it proceeds. EU banks need to sell their Uk stocks/holding by law.
Which makes the whole european market unstable to say the least.

[Rizla2345]

Europe got a little crisis going on. The problem is Brexit. If it proceeds. EU banks need to sell their Uk stocks/holding by law.
Which makes the whole european market unstable to say the least.

It´s a fantasyland. I think that by now about 40% of government bonds within the EU have negative yield. The European central bank has bid up the prices of 10 yr. Italian bonds so much that their yield is lower than those of Singapore!

Italy hasn’t had a balanced budget since the nineties. Debt-to-GDP - 132%.

Singapore, does not have any net debt (is balanced within the budget). The country systematically produces a surplus of budget revenue and the GDP growth is at 6.5%.

That´s central intervention for you. How long that will work before it loses control and the real market takes charge is anybody´s guess. Until that happens the already way over indebted overspenders can borrow even more.

[Yakamoto]

Europe got a little crisis going on. The problem is Brexit. If it proceeds. EU banks need to sell their Uk stocks/holding by law.
Which makes the whole european market unstable to say the least.

It´s a fantasyland. I think that by now about 40% of government bonds within the EU have negative yield. The European central bank has bid up the prices of 10 yr. Italian bonds so much that their yield is lower than those of Singapore!

Italy hasn’t had a balanced budget since the nineties. Debt-to-GDP - 132%.

Singapore, does not have any net debt (is balanced within the budget). The country systematically produces a surplus of budget revenue and the GDP growth is at 6.5%.

That´s central intervention for you. How long that will work before it loses control and the real market takes charge is anybody´s guess. Until that happens the already way over indebted overspenders can borrow even more.

Everyone is going to aim to keep the gravy train rolling, as long as everything hasn't crashed, more and more people are going to aim to keep the system rolling.

The more currency there is available, the less their debt is valued, and the sooner they can pay it off, right? /s

[Rizla2345]

Europe got a little crisis going on. The problem is Brexit. If it proceeds. EU banks need to sell their Uk stocks/holding by law.
Which makes the whole european market unstable to say the least.

It´s a fantasyland. I think that by now about 40% of government bonds within the EU have negative yield. The European central bank has bid up the prices of 10 yr. Italian bonds so much that their yield is lower than those of Singapore!

Italy hasn’t had a balanced budget since the nineties. Debt-to-GDP - 132%.

Singapore, does not have any net debt (is balanced within the budget). The country systematically produces a surplus of budget revenue and the GDP growth is at 6.5%.

That´s central intervention for you. How long that will work before it loses control and the real market takes charge is anybody´s guess. Until that happens the already way over indebted overspenders can borrow even more.

Everyone is going to aim to keep the gravy train rolling, as long as everything hasn't crashed, more and more people are going to aim to keep the system rolling.

The more currency there is available, the less their debt is valued, and the sooner they can pay it off, right? /s

Bond price and yield move in opposite directions. The higher the price the lower the yield and vice versa. Which is why those yields are very close to zero or even negative. It´s central banks buying bonds. In a so called capitalistic system you have in effect central control of interest rates. If hypothetically, this control were totally relinquished next week everybody would rush to sell this way overbought bond mess, interest rates would skyrocket as a result and the whole financial system would implode.

[Pab]

EU banks are crashing in silence untill some time whan it will explode
Not only German but itaian,spanish,french very much,dutch
thay are all related,but if will brexit will be euroexit also
Euro currency has to fail EU needs reforms all will crash

[Rizla2345]

During a leisurely stroll around Germany, one may encounter many strange sights but nothing would stranger than the following ad (courtesy of Peter Barkow) which promises negative 1% interest rates for consumer loans up to 24 months.

Here is the quick and dirty: take out a loan and pay 1% less.

For the fine print we go to Santander Consumer Bank AG, which has this to which has this to say about this self-amortizing (if only in the beginning) loan....

http://www.zerohedge.com/news/2016-04-09/meanwhile-germany-unexpected-ad-appears

[funkenstein]

First of all, all fiat currency is issued at an effective interest rate of negative infinity:

http://frass.woodcoin.org/negative-interest-rates/

Second of all, "oh no these banks are in trouble" is hardly going to bat an eyelash today.  Many of these institutions have ways of issuing currency.  The only thing they are worried about (and this not very worried) is that there might be one or two thinking people who would refuse to accept their paper as valuable.  But this is Europe after all.  Nobody thinks.  The Euro is money. 

[Rizla2345]

I guess when interest rates are turning negative and bank stocks are crashing that is probably decent clues that the system is starting to get a bit wobbly.

[Rizla2345]

There was a time when the German chancellor and the head of the European Central Bank had nice things to say about each other. Mario Draghi spoke of a "good working relationship," while Angela Merkel noted "broad agreement." Draghi, said Merkel, is extremely supportive "when it comes to European competitiveness."

These days, though, meetings between the two most powerful politicians in the euro zone are often no different than their face-to-face at the most recent summit in Brussels. She observed that his forced policy of cheap money is endangering the business model of Germany's Sparkassen savings banks and retirement insurance companies. He snarled back that the sectors would simply have to adapt, just as the American financial sector has.

This is nothing new: we have been hearing laments by Europe's biggest bank, Germany's Deutsche Bank, that the ECB has gone too far for over two months now (initially in "A Wounded Deutsche Bank Lashes Out At Central Bankers: Stop Easing, You Are Crushing Us"). But for Merkel to take her feud in the open, and seeking to once again freeze relations between Germany and the ECB at this fragile juncture for the future of Europe, when Draghi has once again failed to stimulate inflation, when he has crushed European banks, but at least has unleashed a massive debt issuance spree, is troubling.

Spiegel has much more:

The alienation between Germany and the ECB has reached a new level. Back in deutsche mark times, Europeans often joked that the Germans "may not believe in God, but they believe in the Bundesbank," as Germany's central bank is called. Today, though, when it comes to relations between the ECB and the German population, people are more likely to speak of "parallel universes."

The reason for German anger: rates....read more

http://www.zerohedge.com/news/2016-04-09/people-germany-arent-stupid-germany-takes-aim-ecb-spiegel

[botany]

Banks are just a reflection of the overall economy.
If the outlook for the overall economy is bad, banks can't be expected to do much better. 

[tobacco123]

Not only banks in Europe is performing badly. Those in Asia are also not doing well. I guess this is a global crisis.

[stan.distortion]

Not only banks in Europe is performing badly. Those in Asia are also not doing well. I guess this is a global crisis.

Things not looking good there either? Some have the sense to build lifeboats from something more durable than paper though, saw this earlier and was very surprised:
http://anonhq.com/game-changer-china-set-start-yuan-based-gold-price-fix-april-2016/

[malzahar]

Sounds about right though..

Arent we still feeling the after effects after the financial crisis in 2008? they said something about a minimum of 5-6 years to recover?

[richardsNY]

Sounds about right though..

Arent we still feeling the after effects after the financial crisis in 2008? they said something about a minimum of 5-6 years to recover?

I don't think these are after effects of anything. It looks more like there is another deep crisis coming our way. Not sure when we will feel the heavy impact of this, but I'm fairly sure it won't take longer than 2 years before it will hit the markets. It will be interesting to see what kind of (positive?) impact it will have on the price of Bitcoin by that time.

[galdur]

Japan Desperately Needs a Stronger Dollar, China Desperately Wants a Weaker Dollar: The Fed Can't Please Both

April 7, 2016

The FX market is about to blow up in the Fed's face, and there's nothing they can do about it.
Foreign exchange (FX) is a zero-sum game: if one currency weakens, another must strengthen. Since the value of a currency is relative to other currencies, all currencies can't weaken together: at least one currency must strengthen as others weaken.

That one strengthening currency has been the U.S. dollar (USD) since mid-2014. The USD has strengthened by 20%, while the Japanese yen and the euro weakened by 20%. Many developing-economy currencies (rand, peso, real, etc.) have fallen off a cliff, suffering 40% to 50% (or even more) declines against the U.S. dollar.
Why does any of this matter? Simply put, the stock market is a monkey on a leash held by central banks--just give the leash a little tug, and the monkey jumps. Bonds are a gorilla--harder to control, but still manageable--but foreign exchange is King Kong, trading $5 trillion a day and impossible to control beyond short-term manipulations.

Currencies set the underlying trend, not just for bonds and stocks, but for entire economies. A weakening currency makes a nation's exports cheaper in other countries, and the theory is that expanding exports will boost the overall economy--especially if that economy is stagnating or in recession.

A weakening currency also makes imports more expensive in the domestic economy, pushing inflation higher--precisely what every central bank in the world desires, on the theory that inflation will make people spend more (since their money is losing value) and reduce the costs of borrowing (which is presumed to stimulate more borrowing and spending).

This is why everybody seems to want a weaker currency. But as noted above, every currency can't go down; if some weaken, others have to strengthen.

Which brings us to the current brewing crisis: beneath the propaganda that all is well in the world, the soaring dollar has destabilized the global economy in subtle ways: carry trades have been thrown over, capital flows have reversed, commodities priced in dollars have tanked, and so on.

The typical econo-pundit has welcomed the recent weakening of the USD, a reversal of the strong-USD trend:

Read more:

http://www.oftwominds.com/blogapr16/yen-yuan-USD4-16.html

[7788bitcoin]

Maybe the bank in US is also crashing...

http://www.theglobeandmail.com/report-on-business/international-business/us-business/us-banks-dismal-first-quarter-may-spell-trouble-for-2016/article29580566/

[botany]

Not only banks in Europe is performing badly. Those in Asia are also not doing well. I guess this is a global crisis.

Things not looking good there either? Some have the sense to build lifeboats from something more durable than paper though, saw this earlier and was very surprised:
http://anonhq.com/game-changer-china-set-start-yuan-based-gold-price-fix-april-2016/

This could indeed be a game changer. If China does implement a gold fix, it will lose some flexibility with respect to its currency. I am not sure if that will be what it wants. Cheaper yuan is required for the exports that power its economy.

[galdur]

Continued article:

As the yen soars, Japan is being pushed into a self-reinforcing recession. After 20+ years of borrowing to fund fiscal stimulus, money-printing, bond-buying, etc., Japan has run out of options. Weakening the yen was the last best hope to boost exports and inflation.
The strengthening yen is an economic crisis for Japan.

Meanwhile, the strengthening dollar pushed China into its own crisis. China's currency, the renminbi (RMB, a.k.a. yuan), is a special case because its relative value is pegged to the USD by Chinese monetary authorities. The peg was about 9 to the USD in 2005, and in the following decade China pushed the yuan up to 6 to the dollar.

A currency peg means the pegged currency goes up and down with the master currency. As the dollar soared, it dragged the yuan higher, making China's exports more expensive. Given the stagnation of China's debt-bubble dependent economy, the last thing chinese authorities wanted to see was a faltering export sector.

As the USD rose, the pressure to devalue the yuan also rose. If you think your money is about to lose 20% of its value due to a devaluation, what can you do to protect your wealth? Get your cash out of the currency that's being devalued and into a currency that's strengthening.

Just the possibility of a yuan devaluation has sparked an unprecedented capital flight of cash flooding out of China into USD and assets such as homes in British Columbia and chateaux in France. Capital flight is not a sign of a flourishing economy or evidence that the monied class trusts the currency or the economy.

Recently, China has taken baby-steps to devalue the yuan: not enough to trigger global panic but more than enough to trigger capital flight and deep unease.

[galdur]

Don´t miss the charts in the article...


As a result, China desperately wants a weaker dollar, as a weaker dollar will weaken the yuan and relieve the pressure on Chinese exports and demands for devaluation.
Many savvy observers have concluded that the recent G20 meeting in Shanghai led to an informal accord to weaken the dollar to prop up the global economy's shaky foundations--and most acutely, to relieve the pressure on China's yuan, which threatened to destabilize the faltering global economy.
But now the world faces the consequences of a weakening USD: a crisis triggered by a stronger yen. The USD has been yo-yoing in a trading range for a year, as the Federal Reserve has yo-yoed between hawkish declarations of rising rates (which make the USD more attractive and thus stronger) and dovish backtracking (we're never going to raise rates), which then push the USD lower.
No wonder the Fed is wobbling: it can't please both Japan and China. If the dollar plummets, China is delighted but Japan is pushed into crisis. If the USD continues its march higher, Japan is "saved" but China will be forced to devalue the yuan or watch its export sector decline.
As I often note, no nation or empire ever devalued its way to dominance or even prosperity. Rather, the devaluation of one's currency is the kiss of death, as everyone quickly learns your money is a ball that can quickly lose air or go flat.
Here's my take: Japan has no options left. China, on the other hand, can devalue the yuan as the USD strengthens. Indeed, a very good case can be made that China should devalue the yuan, as a practical adjustment to new global realities.
The Fed has a stark choice, and the 2-minute warning just sounded. It can break the informal Shanghai Accord to strengthen the USD to save Japan from the slow-moving catastrophe of a soaring yen, or it can let the USD weaken further to placate China and the commodity-dependent economies.
What it can't do is please everybody. This is the inevitable consequence of manipulating markets: you end up being unable to please anyone, because your constant manipulation has created unsustainable carry trades and speculative gambles.
The FX market is about to blow up in the Fed's face, and there's nothing they can do about it. What central banks fear most are markets that are not tightly controlled by central banks. The world's central banks are about to sit down to a banquet of consequences arising from seven long years of relentless manipulation.

http://www.oftwominds.com/blogapr16/yen-yuan-USD4-16.html

[tabnloz]

Deutsche Bank is one to think about. If the rumoured Shanghai Accord further damages the EU area (by strengthening Euro, deepening the  malaise), then there may be an issue.

This is from their own internal rating measures:

 - Investment grade to junk ratio of 2:1 ie 50% of its credit is junk.
 - Bad risk exposures outweigh good by 30%
 - 746% of its equity is exposed to medium/high to already defaulted exposure.
 - This bank is heavily supported by the tens of billions of euro of the ECBs LTRO and TLTRO (bank welfare) lending facilities, and it's still not nearly enough.
 - If their derivative & OTC exposures reach negative extremities they are on the hook. At the moment asset risk is priced by fair value instead of notional value.

The source for this is from Reggie Middleton's blog, taken from Deutsche bank's own documents. Of course he is not saying it is DB, just a major TBTF EU bank. So, if it isn't DB, its some other massive zombie institution.

Here's the link

https://blog.veritaseum.com/index.php/homes/1-blog/176-so-called-trusted-parties-bank-collapse-the-ecb-and-blockchains-watch-as-i-call-the-next-bear-stearns-again

[Rizla2345]

Austria Just Announced A 54% Haircut Of Senior Creditors In First "Bail In" Under New European Rules

Just over a year ago, a black swan landed in the middle of Europe, when in what was then dubbed a "Spectacular Development" In Austria, the "bad bank" of failed Hypo Alpe Adria - the Heta Asset Resolution AG - itself went from good to bad, with its creditors forced into an involuntary "bail-in" following the "discovery" of a $8.5 billion capital hole in its balance sheet primarily related to ongoing deterioration in central and eastern European economies.

Austria had previously nationalized Heta’s predecessor Hypo Alpe-Adria-Bank International six years ago after it nearly collapsed under the bad loans it ran up when it grew rapidly in the former Yugoslavia. Having burnt through €5.5 euros of taxpayers’ money to prop up Hypo Alpe, Finance Minister Hans Joerg Schelling ended support in March 2015, triggering the FMA’s takeover.

This was the first official proposed "Bail-In" of creditors, one that took place before similar ad hoc balance sheet restructuring would take place in Greece and Portugal in the coming months. Or rather, it wasn't a fully executed "Bail-In" for the reason that creditors fought it tooth and nail.

And then today, following a decision by the Austrian Banking Regulator, the Finanzmarktaufsicht or Financial Market Authority, Austria officially became the first European country to use a new law under the framework imposed by Bank the European Recovery and Resolution Directive to share losses of a failed bank with senior creditors as it slashed the value of debt owed by Heta Asset Resolution AG......

http://www.zerohedge.com/news/2016-04-10/austria-just-announced-54-haircut-senior-creditors-first-bail-under-new-european-rul

[Kakmakr]

Are we in for a next phase of Bail-outs for banks or are they finally going to fail? They cannot sustain negative interest rates for long periods, before things will start to collapse. I always say, if people start buying gold in large quantities, things are pretty bad.

Some people are even hoarding copper and silver to protect their wealth. ^hmmmmm^

[Rizla2345]

We are about to get confirmation that earnings growth for America's biggest companies was negative in the first quarter, compared to the same period a year ago.

When aluminum giant Alcoa releases its results on Monday, it will mark the unofficial start of the heaviest reporting season for S&P 500 companies.

The final scoreboard is expected to show a 9.1% earnings drop for the quarter, according to FactSet senior earnings analyst John Butters.

But the actual decline will likely be smaller, he said. Analysts have ended up being too pessimistic about most quarters since Q2 2013.

Still, earnings would be negative for a third straight quarter....

https://finance.yahoo.com/news/standby-terrible-news-wall-street-100000025.html

[Pab]

Deutsche Bank is one to think about. If the rumoured Shanghai Accord further damages the EU area (by strengthening Euro, deepening the  malaise), then there may be an issue.

This is from their own internal rating measures:

 - Investment grade to junk ratio of 2:1 ie 50% of its credit is junk.
 - Bad risk exposures outweigh good by 30%
 - 746% of its equity is exposed to medium/high to already defaulted exposure.
 - This bank is heavily supported by the tens of billions of euro of the ECBs LTRO and TLTRO (bank welfare) lending facilities, and it's still not nearly enough.
 - If their derivative & OTC exposures reach negative extremities they are on the hook. At the moment asset risk is priced by fair value instead of notional value.

The source for this is from Reggie Middleton's blog, taken from Deutsche bank's own documents. Of course he is not saying it is DB, just a major TBTF EU bank. So, if it isn't DB, its some other massive zombie institution.

Here's the link

https://blog.veritaseum.com/index.php/homes/1-blog/176-so-called-trusted-parties-bank-collapse-the-ecb-and-blockchains-watch-as-i-call-the-next-bear-stearns-again

Thanks for article and for opening that tread.In a case of banks bailout i can say no,that time it will be much bigger crisis related to derrivatives,no money to cover that and many EU zone countries will not agree
Path situation.but behind that we have nationalism movements rise based on islamic fobia,all that islamic terror has been created for that purpose,crash and next war like a solution as it was from 1929 to1939

[galdur]

Now they´re getting seriously worried about dirty bombs. There was a conference about a week ago.

It´s the prefect terror weapon. And the drones make it easy to get wide dispersal of radioactive material. Imagine one going off over Manhattan. It wouldn´t need to be a big thing, the psychological impact would be immense. As would be the cleanup costs.

[ronaldinho_07]

Well the banks always wanna more money that isnt new at all ,the only difference is that with the financial problems banks are more exposed then before.

[galdur]

Italian Banks Halted Limit-Down

INTESA, UNICREDIT HALTED IN MILAN; LIMIT DOWN

Who could have seen that coming?

Hope Turns To Nope As US Stocks Slump Red, Italian Banks Halted Limit-Down

http://www.zerohedge.com/news/2016-04-12/hope-turns-nope-us-stocks-slump-red-italian-banks-halted-limit-down

[HeroCat]

Banks in EU are very strong, because Germany and France are very rich countries, so banks hace a lot of money. Some small bank problems are not important for whole EU market. 

[galdur]

Banks in EU are very strong, because Germany and France are very rich countries, so banks hace a lot of money. Some small bank problems are not important for whole EU market. 

True, Deutsche Bank is just small fry that´s not important for the whole EU market. Credit Suisse is a tiny Swiss bank of no consequence.

[galdur]

When you have major cracks showing in banks like DB and CS and actually other big ones it´s impossible to just ignore it. It´s a sign of systemic weakness. The system starts collapsing from below, smaller banks go first then the larger ones.

[thejaytiesto]

EU banks are crashing in silence untill some time whan it will explode
Not only German but itaian,spanish,french very much,dutch
thay are all related,but if will brexit will be euroexit also
Euro currency has to fail EU needs reforms all will crash

US is not any better, just because they have a ton printed money doesn't mean their economy is recovering. In essence the entire system is fucked, no one trust it anymore and it's getting worse as more and more people that was giving lessons on morality end up being exposed as people that had offshores accounts. No one wants to pay taxes and people is tired of getting robbed. Bitcoin and gold are the only winners in the long term.

[galdur]

EU banks are crashing in silence untill some time whan it will explode
Not only German but itaian,spanish,french very much,dutch
thay are all related,but if will brexit will be euroexit also
Euro currency has to fail EU needs reforms all will crash

US is not any better, just because they have a ton printed money doesn't mean their economy is recovering. In essence the entire system is fucked, no one trust it anymore and it's getting worse as more and more people that was giving lessons on morality end up being exposed as people that had offshores accounts. No one wants to pay taxes and people is tired of getting robbed. Bitcoin and gold are the only winners in the long term.

Yes, it´s the confidence that is actually cracking. It´s one big confidence game. Confidence is the foundation.

When the trust in governments and banks starts to fail as we´re seeing happening now and will be seeing more of, well that´s probably the beginnings of a collapse. How it will develop and when exactly it´ll happen is impossible to tell but it seems extremely likely in the near future, maybe in the next couple years. But then again it could happen later this year. There are other cards in play, war terrorism and more, which could influence this.

[Pab]

Banks in EU are very strong, because Germany and France are very rich countries, so banks hace a lot of money. Some small bank problems are not important for whole EU market. 

Germany banks are full of derivatives,French banks are same nightmare like French economy
All that is balancing on the edge of catastrophe,frauds,money laundering,Panama papers Deutche Bank has 40000 firms like that all over the world irms were Drugs cartels,w eapon traders,and top politicians are meeting each other

French and Germans banks are tick tack nuclear economic mega bomb

[calkob]

The collapse of traditional markets can only be a good thing for bitcoin and the bitcoin related industries 

[iv4n]

Ship is slowly sinking, and I don't wish to make some theories but they are making it, and they will fix it. I enjoy watching this games they play, to me they are funny. One day people will see that all that is just one big lie.
They just wish more money, that is the only game they know. Cause of that I would like bitcoin to grow, and to open shops around the world and in that case I can cancel all my banking cards and credits, to just forget about them.

[galdur]

After the stock market crash of 1987, The Federal Reserve embarked on a path that led to the biggest debt bubble in the history of the world. The day after the 1987 crash (Oct. 20, 1987) Alan Greenspan, Chairman of the Fed, announced to the world that The Fed stood ready to provide whatever liquidity was needed by the banking system to prevent the crash from turning into a systemic financial crisis. That was the day the Fed “put” was born.... read more

http://www.zerohedge.com/news/2016-03-31/2016-end-global-debt-super-cycle

[stan.distortion]

Ship is slowly sinking, and I don't wish to make some theories but they are making it, and they will fix it. I enjoy watching this games they play, to me they are funny. One day people will see that all that is just one big lie.
They just wish more money, that is the only game they know. Cause of that I would like bitcoin to grow, and to open shops around the world and in that case I can cancel all my banking cards and credits, to just forget about them.

Or more often they're wishing for less debt and can't see the wood for the trees, they just see the debt hanging over them and can't see beyond that for long enough to realise what the debt really is. What's even worse is that's happening to entire countries, not just individuals with loans they've little hope of ever repaying but whole nations enslaved as debtors.

Kind of OT but came across this the other day, well worth a read:
http://www.nakedcapitalism.com/2011/08/what-is-debt-%E2%80%93-an-interview-with-economic-anthropologist-david-graeber.html

[jaysabi]

After the stock market crash of 1987, The Federal Reserve embarked on a path that led to the biggest debt bubble in the history of the world. The day after the 1987 crash (Oct. 20, 1987) Alan Greenspan, Chairman of the Fed, announced to the world that The Fed stood ready to provide whatever liquidity was needed by the banking system to prevent the crash from turning into a systemic financial crisis. That was the day the Fed “put” was born.... read more

http://www.zerohedge.com/news/2016-03-31/2016-end-global-debt-super-cycle

Why is the y-axis in log? That distorts the chart and makes a meaningful comparison of the two lines meaningless, although perhaps it advances a particular narrative.

[Curtains873]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

[isildur1]

Ship is slowly sinking, and I don't wish to make some theories but they are making it, and they will fix it. I enjoy watching this games they play, to me they are funny. One day people will see that all that is just one big lie.
They just wish more money, that is the only game they know. Cause of that I would like bitcoin to grow, and to open shops around the world and in that case I can cancel all my banking cards and credits, to just forget about them.

they are fucked and one day they will fuck all of us over due to their constant printing and devaluation of currency

[jaysabi]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so. The chart only tracks the prior 15 years before the "divergence" and uses this as the basis for saying these two lines should track? 15 years isn't a correlation, it's a coincidence, especially when the chart is in log and cropped with axes that don't go to zero. If you back this chart out to a bigger timeframe, you'll find that these two lines don't track each other at all, whether the y-axis is in log or not.

[stan.distortion]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so.

True, if it wasn't then there probably wouldn't be much co-relation, it'd be a hell of a lot more scary though :/

[Curtains873]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so.

One axis moves by 3000% the other by what 10%. I think it catches the divergence.

[jaysabi]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so.

True, if it wasn't then there probably wouldn't be much co-relation, it'd be a hell of a lot more scary though :/

Yes, that's my point. There is no correlation. The author manufactured one that doesn't exist to make his point.

[Curtains873]

MACRO ANALYTICS - 04 01 16 - Our "Lawnmower Economy" w/Charles Hugh Smith

Abstract http://www.gordontlong.com/Macro_Analytics.htm#04-08-16

https://www.youtube.com/watch?v=M7rM2uElXKM

[ronaldinho_07]

Well banks need to readjust their loans and their portfolio,and well big account need to take care as from any moment they can close the doors,but these happens on the countries facing financial problems first,Greece were an example for the people to learn how the system works against them.

[Pab]

Well banks need to readjust their loans and their portfolio,and well big account need to take care as from any moment they can close the doors,but these happens on the countries facing financial problems first,Greece were an example for the people to learn how the system works against them.

exactly like you have wrote Greece were an example for the people to learn how the system works against them.

I think that what thay did was similar to that what was done in 1932 ,destroy american silver dollar and in fact launching fiat,Any crisis something new added to that sytem

1932 that year Hitler become Germany chancellor

[expert4knowledge]

So does this crash show that we have to expect another fall down of euro in the world and specially in front of dollar.

[stan.distortion]

So does this show that we have to expect another fall down of euro in the world and specially in front of dollar.

All western economies, they've all printed themselves into a corner. The real worry for me here is the IMF if/when that happens because they're likely to step in as the "great saviour" and get their hands on everything our banks has laid claim to in the process. That would basically leave us with a 2 party politics style global economy, BRICS and the IMF.

[jaysabi]

Well banks need to readjust their loans and their portfolio,and well big account need to take care as from any moment they can close the doors,but these happens on the countries facing financial problems first,Greece were an example for the people to learn how the system works against them.

exactly like you have wrote Greece were an example for the people to learn how the system works against them.

I think that what thay did was similar to that what was done in 1932 ,destroy american silver dollar and in fact launching fiat,Any crisis something new added to that sytem

1932 that year Hitler become Germany chancellor

I don't follow. What is your link between the banking system and Hitler coming to power?

[The Sceptical Chymist]

I'm sorry, looking at the chart, it shows "eu bank stocks" goin from 115 to just above 95.  I don't see that as world-shattering.  And zerohedge is a doomsday website still much favored by the folks who are still waiting for silver to go to the moon.

[jaysabi]

I'm sorry, looking at the chart, it shows "eu bank stocks" goin from 115 to just above 95.  I don't see that as world-shattering.  And zerohedge is a doomsday website still much favored by the folks who are still waiting for silver to go to the moon.

Haha, I have noticed a high correlation between conspiracy theorists and zerohedge readers. And they're undaunted by the fact that the doomsday prognostications never come true. No one remembers all the failed predictions when there's a brand new doomsday crisis to push every week.

[pitham1]

Well banks need to readjust their loans and their portfolio,and well big account need to take care as from any moment they can close the doors,but these happens on the countries facing financial problems first,Greece were an example for the people to learn how the system works against them.

Adjusting or changing the entire portfolio mix is not a quick process, and is definitely a painful process.
Spain is an example where this adjustment is taking place.

[Swisk]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so.

True, if it wasn't then there probably wouldn't be much co-relation, it'd be a hell of a lot more scary though :/

Yes, that's my point. There is no correlation. The author manufactured one that doesn't exist to make his point.

Hah, nice catch. I think more people need to pay attention to this. Opened my eyes to how easily data can be manipulated to force relationships.

You could argue for scale, but then at the very least you'd need to put the employment percentage in exponential as well.

[jaysabi]

The main point is the divergence since 1987. Before that there was a pretty good correlation.

Yeah but my point is it only looks like a correlation and a divergence because the y-axis is in log. The chart is manipulated to make it look so instead of actually being so.

True, if it wasn't then there probably wouldn't be much co-relation, it'd be a hell of a lot more scary though :/

Yes, that's my point. There is no correlation. The author manufactured one that doesn't exist to make his point.

Hah, nice catch. I think more people need to pay attention to this. Opened my eyes to how easily data can be manipulated to force relationships.

You could argue for scale, but then at the very least you'd need to put the employment percentage in exponential as well.

Yes, and I didn't bring it up initially because the main issue was how badly the chart itself was manipulated to fit the narrative the author wanted to tell, but with the rapidly aging baby boomer generation over the last 20 years and continuing forward, you would expect total employment percentage to start to drop because baby boomers are retiring out of the work force a lot faster than new workers are coming in. But like I said, this is a small issue compared to how badly the chart was manipulated, but another small way the conclusion the author is trying to draw is unfounded.

[Pab]

US Industrial data are showing that USA is entering in recession,no doubt about,data are the same ike in the
begiing of any previous recession
So no more rates increase and what,lowering rates,negatives rates,new QE
Dead end

[stan.distortion]

US Industrial data are showing that USA is entering in recession,no doubt about,data are the same ike in the
begiing of any previous recession
So no more rates increase and what,lowering rates,negatives rates,new QE
Dead end

No no, everything's fine, nothing to see here at all. In fact, I'd suggest giving our bankers a bonus for keeping everything so stable and secure. That was pretty much the message in 2007 but I doubt taxpayers will be so easily fooled into footing the bill this time around.

[hv_]

Austria Just Announced A 54% Haircut Of Senior Creditors In First "Bail In" Under New European Rules

Just over a year ago, a black swan landed in the middle of Europe, when in what was then dubbed a "Spectacular Development" In Austria, the "bad bank" of failed Hypo Alpe Adria - the Heta Asset Resolution AG - itself went from good to bad, with its creditors forced into an involuntary "bail-in" following the "discovery" of a $8.5 billion capital hole in its balance sheet primarily related to ongoing deterioration in central and eastern European economies.

Austria had previously nationalized Heta’s predecessor Hypo Alpe-Adria-Bank International six years ago after it nearly collapsed under the bad loans it ran up when it grew rapidly in the former Yugoslavia. Having burnt through €5.5 euros of taxpayers’ money to prop up Hypo Alpe, Finance Minister Hans Joerg Schelling ended support in March 2015, triggering the FMA’s takeover.

This was the first official proposed "Bail-In" of creditors, one that took place before similar ad hoc balance sheet restructuring would take place in Greece and Portugal in the coming months. Or rather, it wasn't a fully executed "Bail-In" for the reason that creditors fought it tooth and nail.

And then today, following a decision by the Austrian Banking Regulator, the Finanzmarktaufsicht or Financial Market Authority, Austria officially became the first European country to use a new law under the framework imposed by Bank the European Recovery and Resolution Directive to share losses of a failed bank with senior creditors as it slashed the value of debt owed by Heta Asset Resolution AG......

http://www.zerohedge.com/news/2016-04-10/austria-just-announced-54-haircut-senior-creditors-first-bail-under-new-european-rul

Check that, the IMF pensions are about to lose 150 mio Euro with that haircut!

http://www.reuters.com/article/austria-heta-asset-world-bank-idUSL5N17I1U9

[HeroCat]

European banks are quite strong and rich. Germany and France are very rich countries, they fund a lot of whole EU funds. 

[Denker]

Austria Just Announced A 54% Haircut Of Senior Creditors In First "Bail In" Under New European Rules

Just over a year ago, a black swan landed in the middle of Europe, when in what was then dubbed a "Spectacular Development" In Austria, the "bad bank" of failed Hypo Alpe Adria - the Heta Asset Resolution AG - itself went from good to bad, with its creditors forced into an involuntary "bail-in" following the "discovery" of a $8.5 billion capital hole in its balance sheet primarily related to ongoing deterioration in central and eastern European economies.

Austria had previously nationalized Heta’s predecessor Hypo Alpe-Adria-Bank International six years ago after it nearly collapsed under the bad loans it ran up when it grew rapidly in the former Yugoslavia. Having burnt through €5.5 euros of taxpayers’ money to prop up Hypo Alpe, Finance Minister Hans Joerg Schelling ended support in March 2015, triggering the FMA’s takeover.

This was the first official proposed "Bail-In" of creditors, one that took place before similar ad hoc balance sheet restructuring would take place in Greece and Portugal in the coming months. Or rather, it wasn't a fully executed "Bail-In" for the reason that creditors fought it tooth and nail.

And then today, following a decision by the Austrian Banking Regulator, the Finanzmarktaufsicht or Financial Market Authority, Austria officially became the first European country to use a new law under the framework imposed by Bank the European Recovery and Resolution Directive to share losses of a failed bank with senior creditors as it slashed the value of debt owed by Heta Asset Resolution AG......

http://www.zerohedge.com/news/2016-04-10/austria-just-announced-54-haircut-senior-creditors-first-bail-under-new-european-rul

Check that, the IMF pensions are about to lose 150 mio Euro with that haircut!

http://www.reuters.com/article/austria-heta-asset-world-bank-idUSL5N17I1U9

I guess this is just he beginning.
A lot more of news like that to come the next years.

[stan.distortion]

European banks are quite strong and rich. Germany and France are very rich countries, they fund a lot of whole EU funds.  

That's the trouble, the highly advanced and productive European countries are being dragged down by the others that simply aren't ready for the same level of advancement. Here in Ireland a huge amount of European loans where pumped into the country in an attempt to bring it up to a similar level as the more advanced parts of Europe. It was a big leap forward but it would need to be an order of magnitude bigger at least to actually bring it to the same level, the extra administrative costs alone are unsustainable and it would need a change of mentality that could only happen over generations.

Being taken by surprise by that is inconceivable, lenders on that size are in the business of calculating risks and that one is way off the scale no matter what way you look at it so the whole point of those loans wasn't modernisation, it was debt entrapment, just the same as Greece, Portugal, every other European state that simply couldn't advance that quickly. Something similar was tried in Iceland and a back to back comparison of how the situation played out makes that even more clear, Iceland suddenly found it's self expected to pay back a huge amount of money it never asked for and imprisoned those responsible, it was either that or they'd have been lynched and has dug its self out from the trap. Ireland on the other hand accepted it and is very unlikely to ever escape from it (there's another round of the same in the works right now) and Greece was forced to sign an inescapable agreement to the same ends. Practically the whole world is in the same situation to some degree, debt they never asked for and can't escape from.

[tyz]

This is true. The stock rates of banks are usually indicators of the economic condition. They show preliminary what happens to the economy in a couple of months.

There are too many banks in Europe (in almost all countries) which have a not working and bad business model and which are nonviable.

Banks are just a reflection of the overall economy.
If the outlook for the overall economy is bad, banks can't be expected to do much better. 

[Pab]

You know Panama papers,now there are news who was hiding his money there.There is no news by who that
firms are creared,So only Deutche Bank has about 4000 firms like that all over the world
other big banks german,french,dutch etc have his own,thay are all related,You will nver know how much money is there.It is like parallel economy.Now Deutche Bank has to agree to coparate in inestigation who were frauding gold trading.To avoid next penalties thay will revail who was manipulating market together with them
But thay are to big to fail,great excuse

[alyssa85]

Europe got a little crisis going on. The problem is Brexit. If it proceeds. EU banks need to sell their Uk stocks/holding by law.
Which makes the whole european market unstable to say the least.

What law is this? I've never heard of it. I don't think EU banks hold stocks at all. They might hold bonds, but they rarely hold stocks because they are so volatile.

[OROBTC]

...

Europe and European have a LOT of problems.  Muslim invaders that they do nothing about is just one, albeit a big one.

The European banks apparently have at least as much, or more, debt on their books as the American ones do.  And like stan.distortion above mentioned, Europe has a lot of weaker banks and countries that they have to tend to.  Italian banks are now in the spotlight.

Deutsche Bank is the Gran Enchilada of ticking time bombs.  They were just busted by admitting manipulating silver & gold prices for many years.  Deutsche has HUGE derivatives exposure, more than any other in the world IIRC.


Tick tock tick tock

[jaysabi]

US Industrial data are showing that USA is entering in recession,no doubt about,data are the same ike in the
begiing of any previous recession
So no more rates increase and what,lowering rates,negatives rates,new QE
Dead end

No no, everything's fine, nothing to see here at all. In fact, I'd suggest giving our bankers a bonus for keeping everything so stable and secure. That was pretty much the message in 2007 but I doubt taxpayers will be so easily fooled into footing the bill this time around.

You make it sound like the taxpayers have a say in the matter. There was no referendum in 2008. Things were just done without much consideration of how politically popular the actions were.

[stan.distortion]

US Industrial data are showing that USA is entering in recession,no doubt about,data are the same ike in the
begiing of any previous recession
So no more rates increase and what,lowering rates,negatives rates,new QE
Dead end

No no, everything's fine, nothing to see here at all. In fact, I'd suggest giving our bankers a bonus for keeping everything so stable and secure. That was pretty much the message in 2007 but I doubt taxpayers will be so easily fooled into footing the bill this time around.

You make it sound like the taxpayers have a say in the matter. There was no referendum in 2008. Things were just done without much consideration of how politically popular the actions were.

I'm sure it was considered, probably much in the same way as the popularity of the Iraq war was considered, ie. "how much can we get away with?".
Here's how one of Irelands biggest banks added up the numbers:
http://www.zerohedge.com/news/2013-06-24/anglo-irish-picked-bailout-number-out-my-arse-force-shared-taxpayer-sacrifice

[expert4knowledge]

So does this show that we have to expect another fall down of euro in the world and specially in front of dollar.

All western economies, they've all printed themselves into a corner. The real worry for me here is the IMF if/when that happens because they're likely to step in as the "great saviour" and get their hands on everything our banks has laid claim to in the process. That would basically leave us with a 2 party politics style global economy, BRICS and the IMF.

But such downfalls and crash should not happen worldwide so early. 1930-2008 and the next one will need more years.