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Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio

 
Anonymous Coward
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02/20/2018 12:06 AM
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Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
Anonymous Coward
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02/20/2018 12:32 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
Bailout
Useless Cookie Eater

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02/20/2018 12:34 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
So the Nazi bank bet against Trump.....and lost it's shirt in the process.


epiclol
Anonymous Coward
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02/20/2018 12:40 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
Just sell the stock in wallstret,we love bailing out the world with our 401ks,we live to be raped!
Anonymous Coward
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02/20/2018 12:41 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio

 Quoting: Anonymous Coward 76257117


You're confusing notional value of the derivatives with the actual value of the instrument. It's a fallacy that derivatives are really worth what they claim to be worth. No one actually calls them in. They just buy and sell them for their exchange value.
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02/20/2018 12:41 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio

 Quoting: Anonymous Coward 76257117


You're confusing notional value of the derivatives with the actual value of the instrument. It's a fallacy that derivatives are really worth what they claim to be worth.
No one actually calls them in. They just buy and sell them for their exchange value.
 Quoting: Anonymous Coward 63866313


cruise bong
Anonymous Coward
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02/20/2018 01:21 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio

 Quoting: Anonymous Coward 76257117


You're confusing notional value of the derivatives with the actual value of the instrument. It's a fallacy that derivatives are really worth what they claim to be worth. No one actually calls them in. They just buy and sell them for their exchange value.
 Quoting: Anonymous Coward 63866313


Not really, they are used primarily to increase leverage above and beyond all regulatory limits. That's why they are exchanged under the counter, they are not regulated.

So when you get a serious problem that develops, like Lehman or Bear Stearns, then liquidity freezes up, because they've all been making loans to one another above and beyond legal or regulatory limits.

It would be an easy matter for governments to just ban them outright, marking the notional value to zero, but then everything would just freeze up. Since credit requires constant payment streams a frozen bank is like a blocked artery in your body and you suffer a cardiac arrest.

Derivatives basically linked all the commercial banks of the world into a web, it allowed for further credit expansion at the risk of catastrophic failure, meaning liquidity freezes.
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02/20/2018 01:28 AM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio

 Quoting: Anonymous Coward 76257117


You're confusing notional value of the derivatives with the actual value of the instrument. It's a fallacy that derivatives are really worth what they claim to be worth. No one actually calls them in. They just buy and sell them for their exchange value.
 Quoting: Anonymous Coward 63866313


Not really, they are used primarily to increase leverage above and beyond all regulatory limits. That's why they are exchanged under the counter, they are not regulated.

So when you get a serious problem that develops, like Lehman or Bear Stearns, then liquidity freezes up, because they've all been making loans to one another above and beyond legal or regulatory limits.

It would be an easy matter for governments to just ban them outright, marking the notional value to zero, but then everything would just freeze up. Since credit requires constant payment streams a frozen bank is like a blocked artery in your body and you suffer a cardiac arrest.

Derivatives basically linked all the commercial banks of the world into a web, it allowed for further credit expansion at the risk of catastrophic failure, meaning liquidity freezes.
 Quoting: Anonymous Coward 30194358


So let's say that governments don't ban them, then the derivatives force monetization of the loans that banks have made outside regulatory limits.

That's when the CBs start buying these products, like the fed bought $2 trillion in mortgage backed securities to prevent a collapse of the system. That means the payment streams that were moving around, maintaining 'solvency' and liquidity are provided by the central banks, monetizing the derivatives.

So if DB blows up, and the central bank of Germany doesn't force them into bankruptcy, with associated counter party risk (all other banks relying on payment streams from DB), then they will monetize all their affected derivatives to keep the system working.

This is probably how the fiat currency system will implode into hyper-inflation.
Anonymous Coward
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07/17/2019 11:04 PM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio


[link to www.youtube.com (secure)]
Anonymous Coward
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07/17/2019 11:35 PM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
Anonymous Coward
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07/17/2019 11:50 PM
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Re: Deutsche Bank MELTDOWN as Central Banks Unable to Bail Out WORLD’S BIGGEST Derivatives Portfolio
lol,hyper inflation is a third world game,the rich just print whatever they want.liquidity dont mean nothing to a printing press.





GLP