The Brown Stuff Is Flying Closer To The Fan Blades – Derivatives Problem At Deutsche Bank

Before I start in on subject matter of the title, I wanted to post a comment someone sent me about the Martin Armstrong assertion that the decline in Swiss exports to Asia signals a decline in demand from China.  An assertion that I said was invalid and that – by design – the Chinese Government has made it impossible to track the amount of gold imported to China.    Here’s the remark from a very well-respected market analyst:

The decline of gold shipments from Switzerland to China can be due to a declining supply of gold at current prices.  And for a guy [Armstrong] who’s smart, he should be able to figure out the LBMA paper market fraud in a second but he just can’t seem to get it.

The co-CEOs of Deutsche Bank unexpectedly stepped down.  Recall that Deutsche Bank is now the largest holder of derivatives in the world.  LINK

The ONLY reason these resignations would have been unexpectedly coerced like this is if Deutsche Bank was have a potentially uncontrollable problem in its OTC derivatives holdings.  Because of accounting rules, we have no possible way of knowing what DB’s OTC derivatives book looks like.  Although Jain oversaw the build-up of the book, it’s likely that not only does he not know where all the bodies are buried, he has lied to the board of directors and shareholders about the riskiness of the bank’s holdings.

I know Jain from personal experience with him right after Deutsche Bank acquired Bankers Trust for BT’s derivatives capabilities.  It instantly put Deutsche Bank in the forefront of the fraud-based OTC derivatives business.   Jain has lost money wherever he worked .  He was brought over to DB from Merrill when Edson Mitchell assumed the reigns at Deutsche Bank’s US unit.

I just remember thinking Jain was about as sleazy as they come.   His sole charge was to build Deutsche’s derivatives book of business into the biggest in the world.   From there he sleazed his way into the CEO position, a few years after Mitchell went down in plane accident.  He then proceeded to climb to the top of Deutsche Bank by conspiring to “shoot” then-CEO Josef Ackerman in the back.

Deutsche Bank is sitting on a powderkeg of derivatives dynamite.  DB is also the entity that has leased out most of Germany’s sovereign gold.   From a good friend of mine who worked at DB and still keeps in touch with former colleagues:   “Deutsche Bank is sitting on a lethal amount of derivatives and everyone at the bank knows it.”

This is the quote from the person who sent me the article linked above:

Like I said many times over the past 6 months…the derivatives in Europe have gone SIDEWAYS and there is blood in the back rooms of the world’s biggest derivative traders! News yesterday that $6B in derivatives were being “internally investigated” at the world’s largest derivative holder, Deutsche Bank, is followed today by the resignation of BOTH of it’s CEO’s!!

Anshu Jain has thus overseen the world’s largest arsenal of deadly financial derivatives. When Deutsche Bank goes down in flames, the Jain’s bank account should be the first source of funding the losses.  May whatever Higher Power there may be up above help us all when the derivatives financial nuclear daisy-chain starts to blow…

 

8 thoughts on “The Brown Stuff Is Flying Closer To The Fan Blades – Derivatives Problem At Deutsche Bank

    1. Seems kind of ridiculous to me, but I do find it strange we haven’t seen a picture of Kerry with a full-length leg cast getting autographed by Obama.

  1. Spot on with this write-up, I actually believe that this website needs
    a great deal more attention. I’ll probably be back again to
    read through more, thanks for the information!

  2. stay on point dave…
    i cant read everybody but i keep u in the mix daily based on the substance…
    thanks again and STAY ON POINT…..

  3. Hi Dave:

    Thank you for keeping us aware of what is really going on behind the financial curtains. Armstrong seems to know what is going on, but often sounds like a government shill on his call for Electronic money and the death of cash. It is really hard to know who is telling the truth and who is blowing smoke in your eyes.

    As always, it is a matter of when…. when will the markets recognize there is no there, there and everyone runs for the exits and these derivatives blow up. Is it the end of June (this Month) when Greece can’t make its payment to the EURO-Troika? Causing a waterfall of bond failures across Europe, then the globe? Or will it be a loss of confidence by the public in the lies and layers of BS the government lays on us, that causes the public trust to finally fail causing massive bank runs on savings?
    Any thoughts on timing?

    1. “Timing” is the zillion dollar question. Anyone who could predict that and had access to enough capital
      could make himself richer than Bill Gates or Warren Buffet by shorting anything and everything connected
      to the dollar.

  4. Deutsche Bank AG is conducting an internal probe into possible money laundering by Russian clients that may involve about $6 billion of transactions over more than four years, according to people with knowledge of the situation.
    The Bank of Russia approached Deutsche Bank in October asking the firm to examine the stock-trading activities of some clients in the country, said one person, who asked not to be identified because the discussions are private.
    Benjamin Lawsky’s Department of Financial Services in New York is looking at unusual trading activity at the firm in Russia, another person said. Deutsche Bank is analyzing data from 2011 through early 2015, and has alerted Britain’s Financial Conduct Authority, the European Central Bank and Germany’s Bafin of the investigation, two people said.
    “We are committed to participating in international efforts to detect and combat suspicious activities and we take strong action where we find evidence of misconduct,” Deutsche Bank said in an e-mailed statement Friday. “We have placed on leave a small number of individuals from our Moscow operation pending the results of an internal review.”
    Suspect Trades
    Deutsche Bank shares fell 1.7 percent to 27.61 euros in Frankfurt. They are up about 11 percent this year, compared with a 14 percent gain in the STOXX Europe 600 Banks Price Index.
    The transactions being examined involve stocks bought by Russian clients in rubles through Deutsche Bank, and simultaneous trades through London in which the bank bought the same securities for similar amounts in U.S. dollars, the people said. Deutsche Bank is probing whether the transactions allowed Russian clients to move funds out of the country without properly alerting the authorities, one person said.
    Officials for the FCA, the ECB, Bafin and the DFS declined to comment. The Bank of Russia in Moscow doesn’t comment on the actions of banks, according to the regulator’s press service. Deutsche Bank is also examining whether it should have alerted regulators sooner, one person said.
    The value of the suspect trades may be higher than is currently being reviewed and the investigation is continuing, one person said. The role played by Deutsche Bank staff is still being looked at, the people said.
    Staff Leave
    Tim Wiswell, who runs the firm’s Russian equities business, is among the employees who were placed on leave in April in connection with the probe, a person said. Wiswell declined to comment when reached on his mobile phone on Friday.
    Deutsche Bank, which has one of the largest foreign investment banks in Russia, employs more than 1,000 people in Moscow and St. Petersburg across its businesses.
    Read this next:
    • Deutsche Bank to Bond Investors: Wake Up and Smell the Fundamentals
    • Deutsche Bank’s Bittar Tried to Hire Tom Hayes Away From UBS
    About 60 billion rubles ($1.1 billion) of Russian shares were traded on average daily during the month of May in Moscow and London, according to the Moscow Exchange. Deutsche Bank ranks among the top dozen brokers of stocks on the Moscow Exchange, the data show.
    Deutsche Bank, Germany’s biggest bank, was fined $2.5 billion in April by regulators in the U.S. and the U.K. for manipulating interest-rate benchmarks. The penalty is the biggest Deutsche Bank has paid for misconduct and comes on top of the 7.1 billion euros ($8 billion) it spent on litigation in the past three years. The firm’s outstanding legal challenges include probes into the rigging of benchmark foreign-exchange rates, as well as investigations into mortgage- and asset-backed securities dealings and alleged U.S. sanctions violations.
    Manager Magazin, a monthly German magazine, reported in May that Deutsche Bank had informed Bafin about possible money laundering at its Moscow branch.
    “The more aggressive stance of regulators is clearly driving this pre-emptive behavior,” said Andre Spicer at Cass Business School in London. “The bank wants to be able to show it has taken action before it was forced to by the regulator.”

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