Deutsche Bank (a.k.a. Dead Bank Walking)
As we approach the grand climax of global debt default and economic reset, the broke, insolvent West has moved from killing its bankers to killing its banks. Since 2012, The Guerilla has been warning that every night Deutsche Bank shuts its doors it has the potential to never open them again. You see, Deutsche Bank is stuffed to the rafters with “assets” so toxic that even the German government might think twice about bailing it out. The Guerrilla knows the danger that lurks inside Deutsche Bank because an individual who is very close to the Economic Great Ape works for the German/Euro giant. This contact is, in fact, one of The Guerrilla’s relatives.
I’ve known about Deutsche Bank’s troubles since 2005, but back then everyone from DB and PNB to ABN AMRO were rolling in the subprime/derivative slop like a bunch of happy PIIGS. The punch was flowing and the cocaine was blowing. It was one great party in the financial world, though the Economic Silverback knew that the celebration would someday come to an end and there would be hell to pay.
That hell came in 2008 and as a result many of the institutions that were around prior to the market crash of 2008 are no longer with us. They have merged or been restructured. Everyone that is except for the tarnished Pearl of the Eurozone – Deutsche Bank – a bloated leftover from the fun, sun, and good time credit bubble days of yore.
The Signs of the End
Many talking heads are stating that Deutsche Bank is the next Lehman Bros. They are correct, but they underestimate the gravity of the situation. Deutsche Bank’s role in the big picture is much more serious than Lehman’s because Deutsche Bank is at least 3x bigger! The Western banking system is being exposed to the risk of a bigger bank collapse than Lehman’s by orders of magnitude.
Behold the threat that is Deutsche Bank:
• Red Flag #1 – Back in April 2014, the Bank for International Settlements in Basel, Switzerland forced DB to raise its Tier 1 capital level. Tier 1 assets are a bank’s primary sources of capital, comprised largely of common stock, reserves, earnings, and preferred stock. The BIS is the central bank for central banks so its involvement should set off big time alarms. If the BIS has to become involved it means that the bank in question does not have sufficient capital in relation to its risk exposure. In other words, DB owes more than it owns, making it INSOLVENT.
• Red Flag #2 – Proof of DB’s INSOLVENCY came one month later when it began frantically searching for liquidity in May of 2014. At that time DB dumped more than 8 billion Euros worth of its stock at a whopping 30% discount! This was a second red flag that should have caused regulators to look into DB and the risk of its time bomb holdings in the derivatives market.
• Red Flag #3 – In March 2015, DB epically failed an ECB bank stress test causing “Super Mario” Draghi to urge DB to shore up its capital structure. Once again the question of solvency raised its head, but no one did anything about it.
• Red Flag #4 – In June 2015, Greece missed an IMF payment causing DB to tighten its monetary sphincter and sell a significant amount of on (and off) the books Greek debt. DB’s co-CEOs jumped ship and the S&P lowered DB’s credit rating to BBB, three notches above “junk.”
BBB is lower than Lehman before it went bust.
These are the horrific signs of Deutsche Bank’s INSOLVENCY, but they haven’t been enough to bring out the truth so let’s go back to 2014 when …
• DB sold its seat on the London gold price fix.
• DB faced indictment for its role in the LIBOR rigging scandal.
• DB sold off its individual business CDS contracts to JPM and pulled out of commodities entirely.
The bottom line, dear readers, is that DB is one of the primary players involved in massive fraud through precious metals manipulation, LIBOR rigging, FOREX rigging, and interest rate swaps. All of this is coming back to haunt Europe’s biggest bank. Deutsche Bank is officially circling the drain.
The truth about fractional reserve banking is that banks are bankrupt all the time by design. The Ponzi game is to maintain the illusion of solvency until the reality of Economic Mother Nature tears down the facade. First the implosion happens slowly, then it occurs so rapidly that before the public smells smoke the building has already gone down in flames. Re-read the list above! The signs of DB’s insolvency are there for all those willing to see.
So what’s the danger? The threat is that DB has the highest derivative contracts exposure in the world – a massive $75 trillion. With that size trip wire any moves, no matter how minute, can bring the banking giant to a catastrophic end. Remember, Greek defaults have begun. They will send more and more pressure into the derivatives market, particularly in IR swaps where DB likes to play most.
The Clean-Up Team
How will DB meet its well-deserved end? The Guerrilla will tell you and trust me what you are about to read is of the utmost importance to the story.
There is a corporate clean-up team on Wall Street that I like to call The Vultures. These are vassal executives that work in revolving door posts in The City and on Wall Street. They are key financial bomb makers who are masters at creating situations and instruments that have the designed effect of blowing up and destroying financial institutions.
I personally know two of the top Vultures who have been sent in to kill Deutsche Bank. These two gents participated in the take down of Lehman, whose bones JPM & Goldman Sachs picked clean by absorbing all the assets and none of the debt. The Vultures then moved to Bear Stearns, which also imploded, allowing JPM & GS to pick its bones clean. Now they have been ordered to do in DB. Previously, these gents worked in Asia, not coincidentally at the same time that dead bankers started showing up in the Far East.
The long and short of it, folks, is that Deutsche Bank is a dead bank walking. It will be killed and its carcass will be stripped by JPM, Goldman Sachs, and Barclays. DB’s death will shore up Barclays, which is another major criminal syndicate bank, and send shockwaves around the world. You can expect further bank failures in the Eurozone to come of this. Some will be quick; others will take much longer, but be assured the biggest top heavy domino is about to tipped over.