WHAT!!! IF PIGGS could fly: DAXIA BANK MIGHT BE SOLVENT!!

[Aman A.K.A. Ahamburger]

Nov 16, 2015 0:31:00 GMT -5 bimetalaupt said:

Just my thought: We are looking a the real problem now for the first time: The EU is out of money.  They need capital :like principle now.  There banking system has been hollowed out like 1932!!  Banks are out of reserves for losses.  Just look at the PIGGS: still little improvement.  Very little of the stimulants are really going where it is needed. The results will be $1.00 = 1.00 EURO real soon.

As before: Just a thought,
Bruce Duke-Lendrum  MBA

Duke,

Even after I gave your banker friends in Europe the concept of the ESM - which effectively saved the EU in 2011; 100 years of bad foreign and social policy still came back to bite them in the ass, eh?

We did our best.

[bimetalaupt]

The Global debt problem is now about to sink China.
 Flow5 and I POSTED THE BANKING CAPITAL PROBLES IN THE BANKING SYSTEM ABOUT FOUR YEARS AGO ON THE OLD SYSTEM: THINGS ARE ONLY GETTING WORST.  THE WORLD IS GETTING CLOSER TO A MAJOR DEPRESSION.  KA$$$$H IS KING!!
Flow5 and I POSTED THE BANKING CAPITAL PROBLES IN THE BANKING SYSTEM ABOUT FOUR YEARS AGO ON THE OLD SYSTEM: THINGS ARE ONLY GETTING WORST. THE WORLD IS GETTING CLOSER TO A MAJOR DEPRESSION. K
Flow5 and I POSTED THE BANKING CAPITAL PROBLES IN THE BANKING SYSTEM ABOUT FOUR YEARS AGO ON THE OLD SYSTEM: THINGS ARE ONLY GETTING WORST. THE WORLD IS GETTING CLOSER TO A MAJOR DEPRESSION. K
Just a small thought,
Bruce Duke-Lendrum , MBA PharmB

China Has a $1.2 Trillion Ponzi Finance Problem

China Has a $1.2 Trillion Ponzi Finance Problem


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Chinese borrowers are taking on record amounts of debt to repay interest on their existing obligations, raising the risk of defaults and adding pressure on policy makers to keep financing costs low.

The amount of loans, bonds and shadow finance arranged to cover interest payments will probably rise 5 percent this year to a record 7.6 trillion yuan ($1.2 trillion), according to Beijing-based Hua Chuang Securities Co., whose lead fixed-income analyst was top-ranked by China’s New Fortune magazine in 2012 and 2013. Dubbed “Ponzi finance” by Hyman Minsky, the use of borrowed funds to repay interest was seen by the late U.S. economist as an unsustainable form of credit growth that could precipitate financial crises.

Chinese companies are struggling to generate the cash flow needed to service their obligations as economic growth slows to the weakest pace in 25 years and corporate profits shrink. While the debt burden has been eased by six central bank interest-rate cuts in 12 months and a tumble in corporate borrowing costs to five-year lows, the number of defaults in China’s onshore corporate bond market has increased to six this year from just one in 2014.

“Some Chinese firms have entered the Ponzi stage because return on investment has come down very fast,” said Shi Lei, the Beijing-based head of fixed-income research at Ping An Securities Co., a unit of the nation’s second biggest insurance company. “As a result, leverage will be rising and zombie companies increasing.”
Latest Failure

China Shanshui Cement Group Ltd. became the latest company to default on yuan-denominated domestic notes last week as overcapacity in the industry hurt profits and a shareholder dispute stymied financing. State-owned steelmaker Sinosteel Co., which pushed back an interest payment on a bond last month, postponed it again this week.

Metrics of corporate health in Asia’s largest economy have deteriorated as growth slowed. The number of Shanghai and Shenzhen-listed companies that have less cash than short-term debt, net losses and contracting revenue has increased to 200 as of June from 115 in the year-earlier period, according to data compiled by Bloomberg. The amount of bad debt among Chinese banks rose 10 percent in the third quarter from the previous three months to 1.2 trillion yuan, about the size of New Zealand’s economy.
Borrowings Climb

Total debt at listed companies has climbed to 141 percent of common equity, based on a market-capitalization weighted average, the highest level in three years.

While the total amount of debt issued to pay interest is projected by Hua Chuang Securities to increase, it’s taking up a smaller portion of overall new credit. The firm predicts such borrowing will account for 45 percent of new total social financing -- which includes bank loans, shadow banking credit and corporate bonds -- down from 50 percent last year, according to a Nov. 4 report.

Plunging borrowing costs have made it less expensive for Chinese companies to gain access to fresh cash. The rate on five-year corporate debt with AAA ratings dropped to a five-year low of 3.69 percent on Oct. 29 and was last at 3.95 percent.

At the same time, policy makers are taking steps to insure credit keeps flowing to borrowers in need. Chinese banks shouldn’t cut or withdraw lending to companies in “temporary” difficulties, Premier Li Keqiang said last month, adding that the government will take steps to prevent systemic risks. The People’s Bank of China has cut its benchmark one-year lending rate to 4.35 percent from 6 percent a year ago, helping to fuel 6.6 percent growth in outstanding corporate bonds this year to 19.2 trillion yuan as of October.
Defaults Forecast

“The lower funding rates have lessened the interest burden on Chinese companies,” said Xia Le, a Hong Kong-based economist at Banco Bilbao Vizcaya Argentaria SA.

Defaults will probably keep rising as profits fail to keep up with interest expenses at some Chinese borrowers, according to Zhou Hao, a senior economist at Commerzbank AG in Singapore. Earnings at Chinese industrial firms shrank for a fourth straight month in September, while producer prices fell for the 44th consecutive month in October. China’s economic growth will probably slow to 6.9 percent this year, the weakest pace since 1990, from 7.3 percent in 2014, according to economist estimates compiled by Bloomberg.The Global debt problem is now about to sink China. The Global debt problem is now about to sink China. The Global debt problem is now about to sink China. The Global debt problem is now about to sink China. The Global debt problem is now about to sink China.

www.bloomberg.com/news/articles/2015-11-19/china-has-a-1-2-trillion-ponzi-finance-problem-as-debt-piles-up?cmpid=yhoo.hosted

[Aman A.K.A. Ahamburger]

So much real estate... goes down because of war. Whatever will China do?? Article 76. Then we go in and clean up. 

[bimetalaupt]

Nov 20, 2015 18:12:11 GMT -5 Aman A.K.A. Ahamburger said:

So much real estate... goes down because of war. Whatever will China do?? Article 76. Then we go in and clean up. 

A++++,
My thoughts were we could find a buyer for the Canadian WTIE and build a one million barrel daily Catalytic Converter. It is all about $$$$$; Economy of scale.   
Reread the Paragraph that was highlighted.  
Joyce and I plan to be in Europe this Spring. 

God Bless you,
Bruce Duke-Lendrum, MBA, PharmB

[Aman A.K.A. Ahamburger]

Nov 20, 2015 18:34:00 GMT -5 bimetalaupt said:

Nov 20, 2015 18:12:11 GMT -5 Aman A.K.A. Ahamburger said:

So much real estate... goes down because of war. Whatever will China do?? Article 76. Then we go in and clean up. 

A++++,
My thoughts were we could find a buyer for the Canadian WTIE and build a one million barrel daily Catalytic Converter. It is all about $$$$$; Economy of scale.   
Reread the Paragraph that was highlighted.  
Joyce and I plan to be in Europe this Spring. 

God Bless you,
Bruce Duke-Lendrum, MBA, PharmB

Duke M. PharmB. A.,

I see.. and I second the motion of finding the buyer... I guarantee that we will find one?? hundred??... If they pony up the cash for the converter will get the work done. Lendrum Labs won't be deploying any capital there til the dust settles.

The Duke and Duchess will be going to Europe, if their mercenary goes that is... unless we talking about U.K to Luxembourg...

God bless us all,

[Aman A.K.A. Ahamburger]

WHAT!!! IF PIGGS could fly: DAXIA BANK MIGHT BE SOLVENT!!

Which of Europe’s Piigs might fly?

Answer: none, the refugee crisis is the straw of war that causes the east to go down, ending the Great Stagnation, that causes the Death of Socialism! Stay

[bimetalaupt]

Decision of the Dutch Supreme Court in litigation involving Dexia Nederland

On 2 September 2016, the Dutch Supreme Court rendered its verdict on litigation in relation to the role of intermediaries in the sale of share leasing products by Banque Labouchère, purchased by Dexia in 2000 and renamed Dexia Nederland in 2004. Dexia Nederland is currently a direct subsidiary of Dexia SA.

This decision in principle would allow plaintiffs to claim a higher indemnity than they could have under the current jurisprudence, if they bought these share lease products through an intermediary and if certain requirements of duty of care were not met by the intermediary.

The financial impact for Dexia will therefore depend on the ability of plaintiffs to prove in future individual court cases that these requirements were not met. In addition, individual claims made on the basis of the legal principles now formulated by the Dutch Supreme Court may under certain circumstances be time barred.

Dexia takes note of the decision in principle of the Dutch Supreme Court and will analyse in detail its implications.

[bimetalaupt]

UPDATE 2-Austria has creditor support to turn the page on Heta

* 75 pct of senior, 50 pct of junior bondholders agreed so far



* State to pre-finance major part of the payout



* Austria among first to force creditors to take hit (Adds details on financing, governor, background)



By Kirsti Knolle



VIENNA, Oct 4 Enough creditors in failed lender Hypo Alpe Adria have supported a bond buyback offer for the deal to proceed, Austria's finance minister said on Tuesday, drawing a line under the country's worst postwar financial scandal.



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Two years after "bad bank" Heta Asset Resolution was created to wind down Hypo Alpe's toxic assets, Austria hopes the hard-won agreement will restore its credibility with foreign investors and close a painful chapter of financial overreach.



It comes at a price -- the finance ministry is prepared to provide around 8 billion euros ($8.9 billion) for the initial payout, money it expects to recoup from asset sales.



The deal is seen as a test case for European efforts to involve investors in the clean-up of failed banks, rather than leaving the burden entirely with taxpayers.



The southern province of Carinthia, which guaranteed bonds with a nominal value of 11 billion euros ($12 billion) issued by Hypo but was unable to pay in full, offered to buy them back at a discount.



But a long-running standoff over terms ensued with bondholders -- around 70 percent of them German banks and insurers including Deutsche Bank, Commerzbank , Pimco and Dexia Kommunalbank.



The dispute had pushed Carinthia, whose largest city is Klagenfurt, to the edge of insolvency.



Under the new offer, the repayment rate for senior bond holders is seen at 90 percent of nominal value -- around 8 percentage points more than the previous offer. Creditors can pocket the money after 50 days at the earliest.



"As of the end of last week, I can report that the status is now that 75 percent of creditors for senior bonds agree and 50 percent for junior bonds," Finance Minister Hans Joerg Schelling said on the sidelines of a cabinet meeting.



Two thirds of creditors, including 25 percent of junior bondholders, are needed for the offer, expiring on Friday, to be binding. Creditors had rejected a first proposal as too low in March.



Junior bondholders will get back up to 45 percent of nominal value.

[Aman A.K.A. Ahamburger]

I guess when the money is old enough to know that a haircut is better than a full blown panic, we get to see what a big correction in the bond market amounts too if the holders have tons of ka$h...

[Aman A.K.A. Ahamburger]

Oct 6, 2016 20:30:18 GMT -5 Aman A.K.A. Ahamburger said:

I guess when the money is old enough to know that a haircut is better than a full blown panic, we get to see what a big correction in the bond market amounts too if the holders have tons of ka$h...

German companies ready to provide capital for Deutsche Bank

[Aman A.K.A. Ahamburger]

Feb 11, 2016 15:56:02 GMT -5 Aman A.K.A. Ahamburger said:

WHAT!!! IF PIGGS could fly: DAXIA BANK MIGHT BE SOLVENT!!

Which of Europe’s Piigs might fly?

Answer: none, the refugee crisis is the straw of war that causes the east to go down, ending the Great Stagnation, that causes the Death of Socialism! Stay

and a; as Bimetal has mentioned many times: the banking problems in the past all reverberated from Austria and Germany. Deutsche Bank Shares Hit Record Low as Sewing Strategy Fails to Win Confidence

[Aman A.K.A. Ahamburger]

To recap:Daxia and Danske were money laundering machines; the EU has been using drugs and prostitution to mask their ongoing economic problems and China's economy is a massive Ponzi scheme. Now; the major players are hung: German watchdog asks Deutsche to supply information on Danske: source

[Aman A.K.A. Ahamburger]

It's a goldbug site; but the assessment is apt.

Europe is so weak it can’t even handle 0% interest rates

Europe has negative interest rates. And the European economy is so weak (it grew 0.2% in Q4), it can’t even handle ZERO percent interest rates.

Last week the ECB announced it would keep interest rates negative. And it’s starting its third round of cheap loans to banks (who, in turn, are supposed to lend to businesses and households).

The bank also cut its growth forecast from 1.7% (already pretty bad) to 1.1%.

The euro zone is the third-largest economy in the world. And, ten years after the GFC, it can’t keep the machine running unless interest rates are negative and it continues to dole out cheap cash to banks. This is a pretty big deal. And it’s the clearest sign yet of what’s to come…

[verrip1]

Hey Aman.  Hope all things well with you and yours.

As you may remember, I do track things worldwide.  Danske Bank in Copenhagen got my attention during its meteoric drop in the latter part of last year for the Russian money laundering discoveries.  There's also information about similar stuff at Latvia's ABLV Bank and Estonia's state regulators in cahoots with the Danske Bank office in Tallinn.  And I'm not convinced that even Deutsche Bank is clear as EU authorities have repeatedly asking Deutsche for info about their dealings with these other banks.  Let's face it, Danske and ABLV don't have the size to be able to hide enough Russian money.  But somebody like Deutsche could.  I don't think the EU would like their darling Deutsche taking any hits over this.  Subsequently to the Baltic bank revelations were Australian bank allegations about Russian money laundering which have been pretty sketchy from what I've read.

But since I don't read all this shit to widen my perspective on world issues as much as to help me decide where to invest - good capitalist that I am - I actually invested in Danske starting in late October.  Then, the ADR was selling at less than 65% of the EU book value.  It was a classic deep value play.  It was even less of the book value when I filled out my position in February at what I hope will be prove to be a good bottom.  Sure, Danske will pay some sort of fine, etc., but the EU bank regulators will find more than enough places to spread the guilt for the laundering, perhaps even to some of their prized banks.  None the less, buying anything substantial at 60% of book because of media attention is a place for me to start looking.  Its div is currently at 6.4%.  It's not doing as well as my other bank, First BanCorp of Puerto Rico,  but I think that Danske's rapid decline of last year will be at least partially mitigated this year; giving me a good ST cap gain in a non-taxable account.

[Aman A.K.A. Ahamburger]

You gotta have balls of gold to invest like verrip! Haha..

Things are good with my family, my man, thanks! Hope the same with you and yours.

Normally, the contrarian in me would agree with you whole heartedly. Problem is, it's more than money laundering. The EU economy has been including illegal activity in their GDP for years, and it can’t handle positive interest rates. It's truly insane to think in the thousand+ years of recorded financial history, there has never been a prolonged period of negative interests rates; and that's not even the craziest thing going on right now. I mean, DB is literally in talks to "merge!" This is essentially a "Lehman moment." A pillar of German banking, been around for over 140 years, is now essentially being bought out; because the book value was fraudulent. 

If there is one thing we have learned from Flow, it's that EU banks have been living off Fed money for years. What we now know is the EU and Russia - in one way or another - are fully tied into this black hole of debt that is China. What this also means is that while US banks have been recapitalizing, with the excess reserves at the FED backstopping that; the rest of the world has been following the Chinese miracle into the abyss. You see that clear as day in the BRI.

Basically, in my mind, what we are talking about here is the true underlying problem to all this crazy shit going on in the world.

Just like during the last two great depressions, there are MAJOR problems coming out of the German/Austrian banking system. So, while its true there has been an "Asian Crisis" brewing for years (almost exploded in 2015), the reverberations of that are being felt much further than in 1997. Because unlike 1997, it sure seems like 1931 and 1873 all over again in the Holy Roman Empire.....

We gotta talk about a study I did over the past 6 months. Some interesting shifts have occurred during the past 6-8 years, and this will probably have lasting effects on how to make $$$ efficiently in the market.

[Aman A.K.A. Ahamburger]

Ah yes, more similarities to the end of a very old institution: ECB will ask Deutsche Bank to raise fresh funds for merger: source.

[Aman A.K.A. Ahamburger]

Failed merger. Just as Lehman failed to secure funding. Should be interesting....

Deutsche Bank CEO readies investment bank cuts as stock hits low

One small but vocal investor last month added a vote to oust Achleitner to the meeting’s agenda because the bank “remains trapped in an unbroken downward spiral”. The supervisory board issued a statement backing its chairman.

The investment bank generates about half of Deutsche Bank’s revenue but is also considered its Achilles heel, with European regulators fearful that it will fail the next round of stress tests in the United States.

Revenue at the division is forecast to fall to 12.5 billion euros this year, according to a consensus of analysts. That would mark a fourth consecutive year of decline, down 34% from 2015, based on Reuters calculations.

[Aman A.K.A. Ahamburger]

This is a great case study on Lehman: The Collapse of Lehman Brothers: a Case Study. How it leads right into the current "situation" with DB, the echo is something to note to say the least.

[Aman A.K.A. Ahamburger]

So, if I go to borrow some $$$ they pay me. If I have $$$ I pay them. Upside down, backwards... one of these words accurately describes the global banking system. Not right sums it up.

Bankers Stunned as Negative Rates Sweep Across Danish Mortgages

Denmark has had negative rates longer than any other country. The central bank in Copenhagen first pushed its main rate below zero in the middle of 2012, in an effort to defend the krone’s peg to the euro. The ultra-low rate environment has dragged down the entire Danish yield curve, with households in the country paying as little as 1% to borrow for 30 years. That’s considerably less than the U.S. government.

In AAA-rated Denmark’s government bond market, yields are negative right through to the 10-year segment.

[Aman A.K.A. Ahamburger]

In continuing to tie things together, the ASIAN CRISIS part deux.

China’s First Bank Seizure in 20 Years Sets Investors on Edge

With the interbank repurchase rate jumping to the highest in a month and loss-absorbing bonds, known at AT1s, slumping across several small lenders, policy makers on Tuesday injected more cash into the banking system. Baoshang was part of the investment conglomerate led by financier Xiao Jianhua, known as the Tomorrow Group, which is being probed by Chinese officials, according to people familiar with the investigation.

What's that grinding noise

[Aman A.K.A. Ahamburger]

The reason I have been posting to this thread. Daxia was a "bad" bank, supposed to stop the EU bleed. But now, A Trickle of Belgian Colored Deutsche Bank Speculation.

And that bleed, through illegal activities in both the banks and the economy, has bled into that black hole of debt outlined thoroughly in the Asian crisis thread; which happens to be the title of a recent Bloomberg article, which explains how insane the negative interest rates discussed above truly are.(AKA world Debt to GDP at 320%)The Black Hole Engulfing the World's Bond Markets.

[Aman A.K.A. Ahamburger]

Now comes the question of who has to pay? The way HNA (Asian Crisis) already has.

Deutsche Bank's Death By A Thousand Cuts Is Not Over

FT Alphaville’s Jamie Powell was correct today writing that Deutsche Bank’s €43.5 trillion notional derivatives exposure does not equal the credit risk of that portfolio.....

...However, there are a number of things that Powell’s marvelous alliteration article “Deutsche Bank derivative dumbness,’ did not cover. The notional number of derivatives is important, because it signals the scale of potential operational risk to which Deutsche Bank is exposed. Derivatives trading requires a significant number of professionals in the front, middle, and back office who are well trained in how these instruments work, how they are priced, and how the risks are identified managed and controlled.....(The 18k they just laid off)......


.....Here are a few questions that Deutsche Bank executives should answer to regulators, and better yet, market participants, so that they can exert market discipline if needed.

In which legal entities (i.e. bank vs. swap dealer) do derivatives (and for that matter, repurchasing agreements(Repos) within Deutsche Bank reside? And in what countries?

How are derivatives transactions collateralized and where does the collateral reside? Are the derivative and the collateral in the same legal entity?

What contracts are in-at-or-in the money presently? To what entities (i.e. banks, non-banks, corporates) are out-of-the money contracts owed?

What are the underlying assumptions for its Value-at-Risk (Var) and Expected Shortfall models to understand the true extent of Deutsche Bank’s derivatives portfolio’s market risk?

Given Deutsche Bank’s Kafkaesque information technology systems, can its risk measurement metrics be trusted?

That last one is the most important. As the article quoted points out, DB is under investigation for fraud and money laundering. There is literally no way the $40+ TRILLION... with a T!! There is no way these TRILLIONS in derivatives have been properly hedged. In all honesty, the idea that there has been any real risk metrics at DB these past five-seven years is laughable.

And, as already stated HNA, a major Chinese conglomerate, has already been dragged down by DB; this was before it got real ugly these past few months. Considering the scope of the money laundering and fraud through Europe, mix with the fraud that is China.... TRILLIONS!! Who pays?!?