German Government Approves a Merger of Banks

 

Deutsche Bank and Commerce Bank have announced that they will begin merger talks after the government has finally approved that they can lay off workers. For those unfamiliar with the real world behind the curtain, you must realize the extent of socialism in Europe. A major telecom company in Germany called me and asked me to attend an emergency board meeting. They would not even tell me in advance what was so urgent. I flew in that morning from London and to much shock, the board voted to make me the adviser to the company pension fund and never even asked me for a proposal of a fee structure. Then the majority of members resigned.

Three Blocs

BERLIN (Own report) – The German government is proposing a new industrial strategy to shield German companies from takeovers by foreign corporations, while facilitating mergers of large German and EU corporations. The “National Industrial Strategy 2030” presented yesterday, by Germany’s Minister of the Economy Peter Altmaier intends to enable the German industry to prevail in global competition against Chinese, as well as, US corporations. So-called “national” or “European champions” are needed, even if they do not comply with current anti-trust regulations. This has been a proposal in Berlin for quite awhile. Measures are needed “to secure” or “regain Germany’s and the European Union’s economic and technological leadership.” This is also in response to a protectionist race to reindustrialize the USA and the EU, which was launched under Barack Obama and is now being accelerated by the Trump administration.

The Size of Corporate Debt One Rung Above Junk Has Never Been Greater, Warns Louis Gave

 

Louis Gave at Gavekal Research says the greatest source of potential instability in the years ahead lies with the massive growth of the U.S. corporate debt market, particularly at the BBB-rated (near junk) level.

Deutsche Bank Formally Classified as a Problem Bank

 

Deutsche Bank is now been classified as a problem bank by FDIC and has been included in a list of banks to be watched. This is the biggest bank in Europe. It cannot be merged within Germany with Commerce Bank for there is just not enough equity to overcome the derivative losses. The only other candidate is BNP, but that is a French bank. This is where the fairytale of Euroland ends. They wanted to create a single currency, but they were unwilling to actually merge the economies. This is why our sources in Italy argue they are now an occupied country.

Cologne Institute of German Business Warns of Deposit Protection May Not Survive in Europe

 

The Cologne Institute of German Business sees in the planned European deposit insurance is simply incapable of proving protection against a bank crash in Europe. The EU deposit guarantee is simply not practical under any concept of austerity. The Eurozone still has inherent significant risks in the balance sheets of European financial institutions. This is primarily because where the USA took the bad loans from the banks and stuffed them into Freddie and Fanny, in Europe, the bad loans are still on the books of the banks. Systemically, this has been the leading problem why Europe has been unable to recover and Quantitative Easing merely robber savers of their income and it failed completely to stimulate the economy. Banks were still reluctant to lend and people would not borrow if they did not have confidence in the future.

DB warns of US debt crisis.

 

“A coming debt crisis in the US?” warns a Deutsche Bank report* by Quinn Brody and Torsten Slok.

This graph is gorgeous. US deficits have, historically, been driven overwhelmingly by the state of the business cycle, and have very little to do with tax policies and spending decisions that dominate press coverage. In booms, income rises, so tax rate times income rises. In busts, the opposite, plus “automatic stabilizer” spending kicks in.

Until now.

Deutsche Bank CEO suggests robots could replace half the company’s 97,000 employees

John Cryan, CEO of Deutsche Bank (Thomas Lohnes | Getty Images)

 

Some very smart people say that robots are going to steal your job.

Researchers at Oxford University estimate that 47 percent of U.S. jobs could be replaced by robots, automated technology and automated intelligence (AI) within the next 20 years. Jeff Hesse, PwC principal and U.S. people and organization co-leader, tells CNBC Make It, “The displacement is already beginning to happen.”

Elon Musk told the National Governors Association, “There certainly will be job disruption. Because what’s going to happen is robots will be able to do everything better than us.” Musk even went so far as to say that “AI is a fundamental risk to the existence of human civilization.”

The Power in the Center

 

 

BERLIN (Own report) – Using the secessionist conflict in Catalonia as a backdrop, the website of the German weekly Die Zeit published a fiery appeal for dismembering Europe’s nation-states. For quite some time, the author, Ulrike Guérot, has been promoting the “disappearance of the nation-state” in Europe. The nation-state should be replaced by regions with their “own respective identities” that could be “ethnically” defined. As examples, Guérot lists regions with strong separatist tendencies such as Flanders and Tyrol. The author sees herself upholding the tradition of the “European Federalists” of the early post-war period, who – under the guidance of western intelligence services – drew up plans for establishing of a European economic space with free circulation of commodities as a bulwark against the East European socialist countries. Wolfgang Schäuble, as President of the Association of European Border Regions (AEBR) in the early 1980, was also promoting regionalist plans. Inspired by former Nazi functionaries, the AEBR criticized the “nation-state’s barrier effect” of borders in the interests of large corporations. Current economic maps indicate which areas in the EU would form the continent’s most powerful block if regionalization should take effect: south and central Germany as well as its bordering regions from Flanders to Northern Italy.

The Economy of Secession (II)

BERLIN/BARCELONA/MILAN/ANTWERP (Own report) – As can be seen in an analysis of the separatist movements in Catalonia, Lombardy and Flanders, the deliberate promotion of exclusive cooperation between German companies and prosperous areas in countries with impoverished regions has systematically facilitated the autonomist-secessionist movements in Western Europe. According to this study, Flanders, as well as Lombardy – two already economically prosperous regions – have been able to widen the gap between themselves and the impoverished regions of Belgium and Italy, also because they have played an important role in the expansion of the German economy, the strongest in the EU. Through an exclusive cooperation with the state Baden Württemberg, Catalonia and Lombardy have been able to expand their economic lead over more impoverished regions of Spain and Italy, which has spurred their respective regional elites to seek to halt their financial contributions for federal reallocations through greater autonomy or even secession. The consequences of deliberate cooperation – not with foreign nations – but only with prosperous regions, can be seen with Yugoslavia.

De-Dollarization & Disintermediation – Russian Mobile Phone Operator Issues First Blockchain-Backed Bond

 

For months now Russia has been moving into the blockchain space in a serious way. I’ve talked about these moves in previous articles(here, here and yes, even here)

But, the latest news is one that should have every one stand up and take notice.

Russian Mobile phone operator, Megafon, issued RUB500 million in zero-coupon blockchain-based bonds recently. This was purely a proof of concept issuance.

“This Is Where The Next Financial Crisis Will Come From” – Deutsche Bank

 

In an extensive, must-read report published on Monday by Deutsche Bank’s Jim Reid, the credit strategist unveiled an extensive analysis of the “Next Financial Crisis”, and specifically what may cause it, when it may happen, and how the world could respond assuming it still has means to counteract the next economic and financial crash.

In our first take on the report yesterday, we showed one key aspect of the “crash” calculus: between bonds and stocks, global asset prices are the most elevated they have ever been.

Deutsche: The Fed Has Created “Universal Basic Income For The Rich” And Now It Can’t Get Out

 

Two weeks after Aleksandar Kocic highlighted the moment in 2012 when the market stopped caring about newsflow and reality, and, in a word “broke” with pervasive complacency setting in regardless of macro uncertainty…

… Deutsche Bank’s post modernist master of stream-of-consciousness narrative is back with a new essay dissecting his favorite topic, the interplay between the Fed and markets, the so-called “umbilical limbo” that connects the two in the form of ultraeasy monetary policy and QE in general, and more importantly, the narrative that the Fed has spun over the past ten years, which while supportive of risk assets, has concurrently resulted in what Kocic calls a “permanent state of exception” from normalcy as a result of the Fed decision to defer the financial crisis indefinitely.

Deutsche Bank MELTDOWN: Shares plunge as bank tries to raise £6.9BILLION in call for cash

Deutsche Bank’s share price plunged on Monday [Bloomberg]

 

DEUTSCHE Bank shares have dived by six per cent after it announced a shock share sale aimed at raising €8billion (£6.9bn) of cash in a desperate bid to shore up the German giant.

The chief executive John Cryan previously said such a move would be a last resort for the bank.

Now Germany’s largest lender wants to raise the extra capital amid reports of more legal issues, which could lead to more big fines for the troubled firm.

It is the fourth time the bank has had to turn to investors for extra cash since 2010 and suggests Mr Cryan’s previous plans to save the bank have failed.

‘The pound is IRRELEVANT’ German financial giant Deutsche Bank in shocking Sterling swipe

Deutsche Bank branded the pound ‘irrelevant’ [GETTY•ALAMY]

 

Britain’s currency is permanently tarred after the UK voted to leave the European Union (EU), according to one of the bank’s foreign exchange strategists.

As a result, the pound is set to lose its prized status as a leading international safe haven currency, said Robin Winklertold.

Germany, Political Crisis and Superman

Germany’s former defense minister, Karl-Theodor zu Guttenberg, and Chancellor Angela Merkel (Getty Images)

 

Germany’s government, especially Angela Merkel, is proving inadequate. For a leader with the right personality and leadership, this could be a terrific opportunity to seize control of Germany.

Since 1982, the year E.T. the Extra Terrestrial was released and the Falkland War occurred, Germany has had only three chancellors. The United States has had five presidents in that time; Britain six prime ministers; and Italy 15 prime ministers. Even more remarkable: Since the end of World War ii, more than 70 years ago, Germany has had only nine chancellors. That’s an average of eight years per chancellorship. America, in that time, has had 12 presidents, six years per presidency; Britain 15 prime ministers, five years per prime ministership; and Italy 45 prime ministerships, averaging 1.5 years each.

Behind these facts is a fundamental truth: Postwar Germany, perhaps more than any other modern nation, is accustomed to political stability and order.

So what happens if this stable, dependent political system breaks down? History provides some insight.