by Dave Kranzler, Investment Research Dynamics:
“I don’t think it’s any coincidence that gold runs from $1285 to as high as $1445 around the time that all the news about Deutsche Bank started coming out” [the failure to merge with Commerzbank followed by the “good bank / bad bank” split announcement].
Deutsche Bank is being prevented from collapsing by the German Government, the Bundesbank and the ECB. That’s been implicitly acknowledged over the last few years that this is case. The attempt to wash Deutsche Bank’s problems through a merger with Commerzbank failed. In 2008/2009, Bear Stearns’ and Wash Mutual’s sins were cleansed through bankruptcy court and through JP Morgan. In the same way, Merrill Lynch’s disastrous balance sheet was cleansed through Bank of America.
The fact that a similar attempt to wash Deutsche’s bad assets using Commerzbank failed should give us an idea of the relative scale of Deutsche Bank’s hidden financial nuclear waste compared to the derivative bombs that detonated in 2008. I guess the money the Fed and U.S. Taxpayers gave Deutsche Bank in 2008 wasn’t enough…
Chris Marcus, of Arcadia Economics, invited me on to his podcast to discuss DB, gold, mining stocks and, of course, silver: