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September 30, 2016 | Deutsche Bank: What the Hell is Going On?

Mike 'Mish' Shedlock

Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

Deutsche banks shares are plunging again in morning European tradings. It’s 4:13 AM in Chicago, but Germany is seven hours ahead making it 11:13 AM in Germany.

Deutsche Bank shares today set yet another record low in price. The Telegraph reports Deutsche Bank rout deepens: Shares plunge below €10 for first time ever.

What is going on?

Perception Issue

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The first thing we can rule out is Deutsche Bank’s comment this is a “perception issue”.

Banking stocks do not plunge from over $100 to under $10 on perception issues.

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‘We should look at the complete picture’, says Deutsche Bank’s CEO
John Cryan. Deutsche Bank has more than 20 million customers. We are and remain a strong Deutsche Bank.”

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“There are forces now under way in the market that want to weaken confidence in us. Our job now is to ensure that this distorted perception does not more strongly influence our day-to-day business,” said Cryan.

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db-ceo

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Hedge Funds Pull Business From Deutsche Bank

The Financial Times reports Hedge Funds Pull Business From Deutsche Bank

Turkey Buyers

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Links

I had several links as well.

What the Hell is Going On?

I do not know precisely, nor does anyone else. It could be exposure to Italian banks. It could be other counter-party risks. It could be a derivatives problem.

It could be Deutsche Bank’s derivatives book is so massively tangled that the bank itself is clueless where it stands.

But it is 100% clear that something major is wrong.

Regardless of what is wrong, this is the key question: Is a Depositor Bail-In Coming Up?

Get Out of German Banks Now!

No matter what you believe, why take chances?

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Mike “Mish” Shedlock

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September 30th, 2016

Posted In: Mish Talk

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