Are the Banks in TROUBLE!! or just damn GREEDY!?

[trp]

Pretty long video, but anyone else think this is likely? 

 

[Guest]

Who knows if the above can happen, anything can happen in any market so it wouldn't surprise me, the more interesting  point is that if it does happen and the gold/silver ratio hits the low it reached in April 2011 at 31.60 then the equivalent price in dollar terms would be 1582.27848 or c. £1213.50 on today's exchange rate for silver, not a bad rate of return....if it happens, big if but something to bear in mind

[Abyss]

 

[Guest]

We believe in Socialism when it applies to bailing us out, any other type not so much.....

[Bumble]

So we know now that HSBC is in trouble, at the very least. They are not typical, however, because most of their business is in Asia, particularly Hong Kong, so the virus will affect their business quite a lot. It is a plausible speculation that they are one of the consumers of the repo money injection.

[Martlet]

7 hours ago, Bumble said:

So we know now that HSBC is in trouble, at the very least....

Not sure about that, they still reported a profit of $13bn, despite the writedown, and increased revenue by 4.9% to $56bn.  The bad news is from crappy the European market, which they have effectively written off and exited. 

[goldking]

10 hours ago, Abyss said:

 

Interesting to note that HSBC are (one of) the guarantors for the GLD ETFs.  Worth noting for those of you that are in GLD....  

[goldking]

DOW Jones suffered it's biggest ever points loss in history today.  The White House has called an emergency press conference : https://www.zerohedge.com/markets/white-house-hold-emergency-press-conference reportedly to discuss the matter, according to Bloomberg.

Are the wheels about to fall off ? ? ?  

[goldking]

I'm no ZH fanboy but Brandon writes some good articles imo.

https://www.zerohedge.com/geopolitical/global-economy-was-sinking-long-coronavirus-appeared

[Oldun]

Couple of years old but still very valid and a good read.

 

https://asiatimes.com/2018/10/has-the-derivatives-volcano-already-begun-to-erupt/

[Minimalist]

On 20/02/2020 at 11:06, Bumble said:

So we know now that HSBC is in trouble, at the very least. They are not typical, however, because most of their business is in Asia, particularly Hong Kong, so the virus will affect their business quite a lot. It is a plausible speculation that they are one of the consumers of the repo money injection.

HSBC will be gone if it doesnt get a bailout.

[Oldun]

https://gnseconomics.com/en_US/2020/02/10/the-stages-of-the-collapse/

[5huggy]

38 minutes ago, Oldun said:

https://gnseconomics.com/en_US/2020/02/10/the-stages-of-the-collapse/

AWESOME FIND! @Oldun thanks for sharing

That really is a damn good breakdown of what IMHO has already begun -

maybe purely coincidentally (maybe not) under the radar as FOCUS is ALL on virus issues

The QE /REPO amounts being POURED into the "SYSTEM" in virtually ALL countries suggests a strong smell to me of a bank may have ALREADY GONE UNDER! 

and Deutsche bank and HSBC (far east focus !!) are the biggest suspects IMHO

[5huggy]

EXTRACT from an email I received this morning  - - Be AWARE!

I’m getting worried about more than just the stockmarket. More than the bond market – sovereign and corporate. More than just my family’s health.

It’s the government’s coming response that’s giving me goosebumps today. Its response to the economic fallout of coronavirus could be downright dangerous. And we’re not talking hypotheticals.

After the 2008 financial crisis, governments legislated for all sorts of measures. Measures designed to deal with the fragility of the financial system during a crisis. Coronavirus could mean they’re finally used, on you.

I’m talking about things like BRRD (2014/59/EU).

Did you know that, under this law, if your bank fails, depositors’ money can be taken to recapitalise the bank? One day you’re a depositor, the next you own almost worthless shares in the bank instead.

In other words, it won’t be the government paying for the next bank failure. It’ll be the people who sold out of the stockmarket, but forgot to move their money out of the bank.

But why would a bank fail? Well, they’ve just suspended mortgage payments in Italy. And some UK banks are allowing certain borrowers to do likewise.

Who is going to pay the banks’ bills?

At what point will renters demand the same relief, and receive it?

Or what about the banks that lent to oil companies and airlines? How will they cope with the coming losses?

Bloomberg has this headline: “Coronavirus Could Bankrupt Most Airlines by End of May, Consultant Warns”.

And what about all the people being laid off? Swedish Airline SAS is “temporarily laying off” 90% of its workforce! Will they keep paying their mortgages?

Bank bail-ins are just one crackdown to worry about. It’s the growing length of the list that’s the real concern. Let’s look at another 2008 crisis fallout policy we might see.

Is a return to austerity in the cards? Or should I say “austerity”, as the spending cuts were hardly drastic by financial measures.

If the government tries to live within its means after the coronavirus shock, what’ll the budget look like then? How will your government services hold up?

Which tax breaks will have to go and how will this change your financial affairs?

Or if the government doesn’t impose austerity, what’ll the UK’s debts balloon to? After the shock to GDP, what’ll the debt-to-GDP ratio hit? Will the UK join Italy and Greece’s side of the sovereign debt market?

If you’re worried about the stockmarket panic, well, stockmarkets can be closed to stop panic selling. Then your money will be stuck inside.

Or companies can suspend your access to your stocks. JP Morgan’s electronic trading platform for wealthy clients recently froze, as did fintech stock investing provider Robinhood.

Bank holidays are a long-standing favourite of governments in financial difficulty. As are ATM withdrawal limits – all perfectly legal and with precedent these days.

Ironically, our banks tend to teeter because government finances are looking so shaky. And, right now, bond yields are diverging. The likes of Italy have bond yield spikes while the US has bond yields plunging. It’s the divergence that’s dangerous. I’ll try to explain…

Over the past few decades, at the regular Basel meetings in Switzerland, governments created rules that force banks to hold vast amounts of sovereign bonds. This helps finance the deficits of the very politicians who makes the rules. But it also means the banks and governments are tied at the hip.

The problem with this is how the banks were incentivised to do it. The government created capital adequacy rules designed to make banks safer. These rules then assigned a zero risk weighting to government bonds, meaning the bank must treat them as safe and thereby the bank is considered safe if it buys a lot of those bonds.

When analysts tell you that the banking system is much safer than it was, this is what they’re referring to. Designating government bonds as risk free and encouraging banks to buy them.

The flaw is that it’s government bonds which keep struggling because of government debts. At some point we’ll see a Basel Bust, just as we saw a Basel Boom – demand for government bonds from banks bidding up their prices.

It’s the sub-prime equivalent of 2008, but even better than AAA rated. We’re talking risk free, by law. But the law isn’t reality. That’s why European bank stocks are back to the levels of 1988.

Thinking of opting out of all these crackdowns? Trying to escape the government’s grasp when it imposes bank bail-ins, shuts markets, freezes withdrawals and imposes austerity? But how are you going to do it?

Gold gets banned by the authorities when financial crises become severe. Have you already bought all the gold you need to prepare?

Large holdings and transactions of cash are already banned in many countries. Doesn’t coronavirus rather nicely fit the bill to ban cash here?

What about sending your capital overseas for safe keeping? To diversify?

Well, capital controls can see to that nice and quickly. They did for the likes of Cyprus and Greece.

Have you heard about Unexplained Wealth Orders (UWOs) or Account Freezing Orders (AFOs)? It turns out the government can freeze your bank account for up to two years and confiscate property you thought was yours.

Is that a distant measure of the future which no government bureaucrat would actually be willing to use? A financial crime expert and blogger wrote otherwise at the FCPA Blog a few weeks ago: “Recent UK Government data shows how while just 15 UWOs were issued in the two years to April 2019, a total of 670 AFOs were granted over the same period.”

But who can freeze your bank accounts? According to the blog, apart from the obvious contenders, the Food Standards Agency, the Post Office and Transport for London can all apply for AFOs.

What’s the threshold for the AFO? Innocent until proven guilty? Balance of probabilities that you’ve done something wrong? A warrant or evidence of wrongdoing?

Nah… they only have to suspect the money may be used for some unlawful way at some point. Then the Magistrate decides.

In order to obtain an AFO the applicant need only show reasonable grounds for suspecting that money held in an account is either recoverable property (property obtained through unlawful conduct), or is intended for use in unlawful conduct. The account holder themselves does not need to be under suspicion, nor does any criminal offense have to have been proved.

The trouble with this is simple. If the government controls what is unlawful conduct, it can use AFOs and UWOs to confiscate wealth en masse during a crisis.

The point of today’s Exponential Investor is simple. The legal mechanisms for a severe financial crackdown are already in place thanks to the response to the last crisis. You won’t have to see any great change in policy – no controversial new laws would have to be passed. They’re already on the books. Waiting to be used.

And the weaknesses that require their use are already built into the foundations of the banking system and government bond markets too. The crisis is baked in.

Just as we’ve seen quarantines, lockdowns, shuttered stores, public gatherings banned, travel bans and plenty more, we’ll see the financial equivalent in coming months.

That’s why stocks are crashing.
 

[paolo]

3 minutes ago, 5huggy said:

EXTRACT from an email I received this morning  - - Be AWARE!

I’m getting worried about more than just the stockmarket. More than the bond market – sovereign and corporate. More than just my family’s health.

It’s the government’s coming response that’s giving me goosebumps today. Its response to the economic fallout of coronavirus could be downright dangerous. And we’re not talking hypotheticals.

After the 2008 financial crisis, governments legislated for all sorts of measures. Measures designed to deal with the fragility of the financial system during a crisis. Coronavirus could mean they’re finally used, on you.

I’m talking about things like BRRD (2014/59/EU).

Did you know that, under this law, if your bank fails, depositors’ money can be taken to recapitalise the bank? One day you’re a depositor, the next you own almost worthless shares in the bank instead.

In other words, it won’t be the government paying for the next bank failure. It’ll be the people who sold out of the stockmarket, but forgot to move their money out of the bank.

But why would a bank fail? Well, they’ve just suspended mortgage payments in Italy. And some UK banks are allowing certain borrowers to do likewise.

Who is going to pay the banks’ bills?

At what point will renters demand the same relief, and receive it?

Or what about the banks that lent to oil companies and airlines? How will they cope with the coming losses?

Bloomberg has this headline: “Coronavirus Could Bankrupt Most Airlines by End of May, Consultant Warns”.

And what about all the people being laid off? Swedish Airline SAS is “temporarily laying off” 90% of its workforce! Will they keep paying their mortgages?

Bank bail-ins are just one crackdown to worry about. It’s the growing length of the list that’s the real concern. Let’s look at another 2008 crisis fallout policy we might see.

Is a return to austerity in the cards? Or should I say “austerity”, as the spending cuts were hardly drastic by financial measures.

If the government tries to live within its means after the coronavirus shock, what’ll the budget look like then? How will your government services hold up?

Which tax breaks will have to go and how will this change your financial affairs?

Or if the government doesn’t impose austerity, what’ll the UK’s debts balloon to? After the shock to GDP, what’ll the debt-to-GDP ratio hit? Will the UK join Italy and Greece’s side of the sovereign debt market?

If you’re worried about the stockmarket panic, well, stockmarkets can be closed to stop panic selling. Then your money will be stuck inside.

Or companies can suspend your access to your stocks. JP Morgan’s electronic trading platform for wealthy clients recently froze, as did fintech stock investing provider Robinhood.

Bank holidays are a long-standing favourite of governments in financial difficulty. As are ATM withdrawal limits – all perfectly legal and with precedent these days.

Ironically, our banks tend to teeter because government finances are looking so shaky. And, right now, bond yields are diverging. The likes of Italy have bond yield spikes while the US has bond yields plunging. It’s the divergence that’s dangerous. I’ll try to explain…

Over the past few decades, at the regular Basel meetings in Switzerland, governments created rules that force banks to hold vast amounts of sovereign bonds. This helps finance the deficits of the very politicians who makes the rules. But it also means the banks and governments are tied at the hip.

The problem with this is how the banks were incentivised to do it. The government created capital adequacy rules designed to make banks safer. These rules then assigned a zero risk weighting to government bonds, meaning the bank must treat them as safe and thereby the bank is considered safe if it buys a lot of those bonds.

When analysts tell you that the banking system is much safer than it was, this is what they’re referring to. Designating government bonds as risk free and encouraging banks to buy them.

The flaw is that it’s government bonds which keep struggling because of government debts. At some point we’ll see a Basel Bust, just as we saw a Basel Boom – demand for government bonds from banks bidding up their prices.

It’s the sub-prime equivalent of 2008, but even better than AAA rated. We’re talking risk free, by law. But the law isn’t reality. That’s why European bank stocks are back to the levels of 1988.

Thinking of opting out of all these crackdowns? Trying to escape the government’s grasp when it imposes bank bail-ins, shuts markets, freezes withdrawals and imposes austerity? But how are you going to do it?

Gold gets banned by the authorities when financial crises become severe. Have you already bought all the gold you need to prepare?

Large holdings and transactions of cash are already banned in many countries. Doesn’t coronavirus rather nicely fit the bill to ban cash here?

What about sending your capital overseas for safe keeping? To diversify?

Well, capital controls can see to that nice and quickly. They did for the likes of Cyprus and Greece.

Have you heard about Unexplained Wealth Orders (UWOs) or Account Freezing Orders (AFOs)? It turns out the government can freeze your bank account for up to two years and confiscate property you thought was yours.

Is that a distant measure of the future which no government bureaucrat would actually be willing to use? A financial crime expert and blogger wrote otherwise at the FCPA Blog a few weeks ago: “Recent UK Government data shows how while just 15 UWOs were issued in the two years to April 2019, a total of 670 AFOs were granted over the same period.”

But who can freeze your bank accounts? According to the blog, apart from the obvious contenders, the Food Standards Agency, the Post Office and Transport for London can all apply for AFOs.

What’s the threshold for the AFO? Innocent until proven guilty? Balance of probabilities that you’ve done something wrong? A warrant or evidence of wrongdoing?

Nah… they only have to suspect the money may be used for some unlawful way at some point. Then the Magistrate decides.

In order to obtain an AFO the applicant need only show reasonable grounds for suspecting that money held in an account is either recoverable property (property obtained through unlawful conduct), or is intended for use in unlawful conduct. The account holder themselves does not need to be under suspicion, nor does any criminal offense have to have been proved.

The trouble with this is simple. If the government controls what is unlawful conduct, it can use AFOs and UWOs to confiscate wealth en masse during a crisis.

The point of today’s Exponential Investor is simple. The legal mechanisms for a severe financial crackdown are already in place thanks to the response to the last crisis. You won’t have to see any great change in policy – no controversial new laws would have to be passed. They’re already on the books. Waiting to be used.

And the weaknesses that require their use are already built into the foundations of the banking system and government bond markets too. The crisis is baked in.

Just as we’ve seen quarantines, lockdowns, shuttered stores, public gatherings banned, travel bans and plenty more, we’ll see the financial equivalent in coming months.

That’s why stocks are crashing.
 

The rules for bail in are passed already in the recent years in all the world, they have been preparing for this from long time. And i think that the crash in all other asset, metal, crypto, etc.. are orchestrated  to push people into liquity in bank deposit, ready for bail in. Everything is being crashed, except liquidity, that cant be crashed but confiscated. The pressure to suppress metal is to scare investor out of the markets and into liquidity, where the trap has already been placed. That s why i am not worried of the PM prices. Even if they fall 50% , to go into liquidity could mean a -100%.

[paolo]

1 minute ago, paolo said:

The rules for bail in are passed already in the recent years in all the world, they have been preparing for this from long time. And i think that the crash in all other asset, metal, crypto, etc.. are orchestrated  to push people into liquity in bank deposit, ready for bail in. Everything is being crashed, except liquidity, that cant be crashed but confiscated. The pressure to suppress metal is to scare investor out of the markets and into liquidity, where the trap has already been placed. That s why i am not worried of the PM prices. Even if they fall 50% , to go into liquidity could mean a -100%.

And give them few years and i am sure all cash will desappear too.

[5huggy]

4 minutes ago, paolo said:

That s why i am not worried of the PM prices. Even if they fall 50% , to go into liquidity could mean a -100%.

Quite right - and the back up the truck scenario would be in -for me!

---

Added 0 minutes later...

3 minutes ago, paolo said:

And give them few years and i am sure all cash will desappear too.

Monetery reset !

[paolo]

Yes, it s quite easy which direction we are going, just connects the dots. And yes i would like too to load back the truck as more the price goes down, the problem is that spot price goes down but not phisical anymore, premium is compensating for the spot fall, so i am wondering if actually is possible buy lower anymore.

[Martlet]

Yeah, you can find lots to worry about if you want.  Important point of bail-ins is they live alongside depositors guarantees, so if you have under 85k they will cover it, larger depositors will be the ones that get hit.  Unless you are of the opinion they want to crash the system, which would lead to deeper crisis and a whole generation not trusting banks, they wouldnt have anything to rebuild. 

[5huggy]

12 minutes ago, Martlet said:

so if you have under 85k they will cover it

WILL they ??

[paolo]

1 minute ago, 5huggy said:

WILL they ??

In bit skeptical of that ... I dont think they Will. 

 

[paolo]

https://investmentresearchdynamics.com/extreme-disconnect-between-paper-and-physical-gold/

[Martlet]

42 minutes ago, 5huggy said:

WILL they ??

Whats the point in offering the guarantee if you dont honor it?  Would have larger ramifications if they dont. 

[5huggy]

10 minutes ago, Martlet said:

Whats the point in offering the guarantee if you dont honor it?  Would have larger ramifications if they dont. 

Why don't they Honour what you have ANYWAY at any level -

remember that this guarantee was brought in alongside the Bail- in law that sneaked in !

In fact i bet that at least 50% of the UK population DON'T know about the bail-in law - and that is probably "grannies" 

[Martlet]

1 minute ago, 5huggy said:

Why don't they Honour what you have ANYWAY at any level -

remember that this guarantee was brought in alongside the Bail- in law that sneaked in !

In fact i bet that at least 50% of the UK population DON'T know about the bail-in law - and that is probably "grannies" 

The deposit guarantee in UK at least has been in place for years, only change recently been to match the value in Euroland.