Global financial system implosion begins
- Thread starter Falcon
- Start date
teqniq
DisMembered
Yeah I saw something on Twitter yesterday suggesting they might be at risk on Zero Hedge and another update today from the same site which if true would be one of those 'oh the irony' moments seeing as how they were one of the central players in the 2008 crash. Ominous comparisons with the Lehman Bothers being made.
ffsear
Well-Known Member
The US Federal Reserve raised the fed funds rate by 25 basis points in December 2015. Since that quarter point rate increase the stock markets around the world have been tumbling lower. Volatility has surged higher as central banks around the world scramble to figure out there next move. In the past, jawboning by the Federal Reserve has been used to calm the markets, but this time many traders and investors believe that the Federal Reserve has its hands tied. Stocks now seem to come under severe selling pressure on a daily basis.
Recently, the 10-year U.S. Treasury Note yield has plunged to 1.72%. This is signalling that investors would prefer to be in U.S. Treasuries instead of stocks. Oil prices have plunged to less than $30.00 a barrel signalling weak global demand and a stronger U.S. Dollar. What can stop these markets from deflating further? In the past, the answer to a deflating market has been lower interest rates and add lots of liquidity (quantitative easing) to the system. These days the large European banks such as Deutsche Bank AG , Credit Suisse Group AG Banco Santander, S.A. and UBS Group AG are making new multi-year lows on a daily basis. In fact, most of these Euro bank stocks are making new all-time lows. Something is wrong when leading financial stocks have this type of price action.
Problems in Asia have been increasing on a daily basis. The Nikkei 225 Index has dropped by nearly 4000 points since early December. The Shanghai Composite Index has plunged by nearly 50.0 percent since its June 2015 high. What are these central banks going to do to help stabilize these markets?
In late 2008, the central banks around the world staged a very coordinated effort to inflate the stock markets around the world. Can they do this again? After all, the Peoples Bank of China, the Bank of Japan, and the European Central Bank are all doing there own version of quantitative easing right now. So what is wrong? Why are markets tumbling? You see, the Federal Reserve is going to have to join the money printing party once again. The Fed is the missing piece of the liquidity puzzle. After all, most all commodities are priced in U.S. Dollars. The strong U.S. Dollar is one of the primary reason for the weak oil and commodity prices that we are seeing at this time.
Everyone should forget further rate increases by the Federal Reserve. The fed is going to need to cut interest rates and eventually start another QE program to get these markets up around the world. Maybe this time the central bank to the world (Federal Reserve) won't call it quantitative easing, but it's going to need to do something if it wants these markets to stop deflating. In my humble opinion, QE-4 is around the corner.
Recently, the 10-year U.S. Treasury Note yield has plunged to 1.72%. This is signalling that investors would prefer to be in U.S. Treasuries instead of stocks. Oil prices have plunged to less than $30.00 a barrel signalling weak global demand and a stronger U.S. Dollar. What can stop these markets from deflating further? In the past, the answer to a deflating market has been lower interest rates and add lots of liquidity (quantitative easing) to the system. These days the large European banks such as Deutsche Bank AG , Credit Suisse Group AG Banco Santander, S.A. and UBS Group AG are making new multi-year lows on a daily basis. In fact, most of these Euro bank stocks are making new all-time lows. Something is wrong when leading financial stocks have this type of price action.
Problems in Asia have been increasing on a daily basis. The Nikkei 225 Index has dropped by nearly 4000 points since early December. The Shanghai Composite Index has plunged by nearly 50.0 percent since its June 2015 high. What are these central banks going to do to help stabilize these markets?
In late 2008, the central banks around the world staged a very coordinated effort to inflate the stock markets around the world. Can they do this again? After all, the Peoples Bank of China, the Bank of Japan, and the European Central Bank are all doing there own version of quantitative easing right now. So what is wrong? Why are markets tumbling? You see, the Federal Reserve is going to have to join the money printing party once again. The Fed is the missing piece of the liquidity puzzle. After all, most all commodities are priced in U.S. Dollars. The strong U.S. Dollar is one of the primary reason for the weak oil and commodity prices that we are seeing at this time.
Everyone should forget further rate increases by the Federal Reserve. The fed is going to need to cut interest rates and eventually start another QE program to get these markets up around the world. Maybe this time the central bank to the world (Federal Reserve) won't call it quantitative easing, but it's going to need to do something if it wants these markets to stop deflating. In my humble opinion, QE-4 is around the corner.
gosub
~#
Deutsche Bank: No Liquidity Crisis but Capital Fears Are Right
this liquidity problem that Deutsche doesn't have....EU bank bail in regs? Who would keep more than €100,000 in that bank now?
Is the European banking industry facing its own Lehman Brothers moment?
this liquidity problem that Deutsche doesn't have....EU bank bail in regs? Who would keep more than €100,000 in that bank now?
Is the European banking industry facing its own Lehman Brothers moment?
gosub
~#
I don't read Greek, but recognise the language...seems to have been quite a topic of conversation on Greek twitter today.
ska invita
back on the other side
Quick question: Negative interest rates means you end up paying to keep money in a bank, which in turn encourages people not to keep money in a bank and spend it/invest it elsewhere... right? who is this aimed at exactly? the average person? or someone else?
And does it have any corelation to mortgage rates? I take it no one has negative mortgage rates...
And does it have any corelation to mortgage rates? I take it no one has negative mortgage rates...
gosub
~#
It's a new development so not that worked out, is more a tax on banks, actual money in the bank is positive (just) or you wouldn't use them and mortgages also cost.
It stops shed loads of money flooding into your economy cos they think it is safe haven, which would massively raise the exchange rate and destroy your exports.
Based on bonds, and those that buy them
gosub
~#
To clarify: The negative rates apply to banks that are forced to keep deposits with central banks.
If I went to the ECB and said "can I deposit £1000 at -0.5%?" I think they'd refuse
you'd be one of their less problematic clients
ska invita
back on the other side
Thanks! That clears up my confusionTo clarify: The negative rated apply to banks that are forced to keep deposits with central banks.
If I went to the ECB and said "can I deposit £1000 at -0.5%?" I think they'd refuse
bimble
floofy
It's what swiss banks have long been doing though - maybe for the reasons above? I think that's been true for a while, even before they devalued their francs to try to save their exports/ tourism and before the whole secretive numbered system came under concerted attack. I mean if you want to stash your cash in a swiss bank you've long gotten 0% interest plus a hefty charge, which = negative interest, right?
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coley
Well-Known Member
While I don't pretend to understand half of what is said in the article, it looks like Germany is prepared to hammer the weakest southern states, again, though I thought Ireland had largely recovered from 08?
gosub
~#
The only value in debt of some Eurozone countries is in it will get pooled during federalization, something the Germans electorate ain't into doing. Germany is suggesting is throwing those who have invested in it to the wolves. The markets can move faster than the politicians can, if this isn't posturing related to leveraging other things, EUro is about to get a kicking, and the EUropean banks at the same time.
Prepare to duck. On face value: Portugal Fucked April 29
Prepare to duck. On face value: Portugal Fucked April 29
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ska invita
back on the other side
Regarding the relationship between negative interest rates and regular bank users, there is one:
"Japanese bank shares have slumped by as much as 30% as they are unlikely to pass on negative rates to savers, who already get negligible interest on their deposits but would baulk at paying to save. Negative rates could push down bank operating profits by 8-15%, Standard and Poor’s said."
"Japanese bank shares have slumped by as much as 30% as they are unlikely to pass on negative rates to savers, who already get negligible interest on their deposits but would baulk at paying to save. Negative rates could push down bank operating profits by 8-15%, Standard and Poor’s said."
It's all messed up. Italy especially.
ECB in talks with Italy over buying bundles of bad loans - Treasury
Fri Feb 12, 2016
They "help enhance the rating" and as if by magic the speculative junk non-performing loans become investment grade Asset Backed Securities.
Links above from a year ago. Other skeletons in the closet.
Blocking minority still rejects Heta bond buyback offer
Feb 18, 2016
ECB happy to buy Italian junk at face value less so Austrian junk for some reason?
Rate things are unravelling not sure if there'll be an EU for the UK to have a referendum on.
Patteran
A nowadays excuse
There's American Standard & Poor’s and Moody's Investors Service or French Fitch Ratings. I didn't know about Canadian Dominion Bond Rating Service.
DBRS comfortable with Portugal rating, but watching bond yields
Feb 12, 2016
gosub
~#
Cameron said deal allows EUrozone ability to fast track federalization, only way that debt has face value... And the Germans are telegraphing they'd rather pull the temple down all since that DBRS press statement ... Skin of teeth OR a bent rating to prop up.
Extend and Pretend. Keep kicking the can down the road. Too many vested interests.
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