IS THERE A STEALTH FINANCIAL CRISIS? ALARM BELLS ARE RINGING. | WHAT REALLY HAPPENED

IS THERE A STEALTH FINANCIAL CRISIS? ALARM BELLS ARE RINGING.

SOURCE: RIGGED GAME

THE MARKETS ARE SHOWING DISCONCERTING PARALLELS WITH LATE 2007.

BY PAM MARTENS AND RUSS MARTENS OF WALL STREET ON PARADE

Fast forward to today: On June 3, 2019 one of Britain’s highest profile money managers, Neil Woodford, stunned global markets by announcing that his firm’s flagship fund, the $4.7 billion Woodford Equity Income Fund, would freeze customer withdrawals. The decision resulted from heavy outflows and a large stake in illiquid stocks. The U.K. securities regulator, the Financial Conduct Authority, has opened an investigation into the matter. You can read its initial assessment here.

During the 2007-2008 financial crisis one of the largest commercial banks in the U.S., which had turned itself into the banking equivalent of an Everything Bagel with appendages that included an investment bank, brokerage firm and monster derivatives portfolio, saw its share price evaporate and announced it was firing 50,000 employees on November 17, 2008. That bank was Citigroup, which would have failed but for the largest government bailout in global banking history. In January of 2009, with its share price still unable to find a floor (it eventually found it at 99 cents) Citigroup gathered up all of its toxic assets (otherwise known as irresponsible management decisions) and dumped them into a so-called “bad bank” called Citi Holdings to be sold off at big losses as the media lights dimmed.

Fast forward to today: Germany’s largest bank, Deutsche Bank, which has a heavy footprint on Wall Street, announced this past Monday that it was firing 18,000 employees and creating a bad bank to hold $83 billion in toxic assets. Deutsche Bank has other eerie resemblances to the Citigroup of 2008, not the least of which is the fact that its share price has tanked by 90 percent since early 2007…

Webmaster's Commentary: 

Deutsche Bank's statement on Friday, may create havoc all throughout the financial sector; we won't know for sure whether - and how much - Deutsche Bank's "restructuring" has been priced into the markets, or if the "shock" of the magnitude of this announcement, will have investors running for the hills.

There is one thing I can say, with more than a bit of confidence; the US's Plunge Protection Team will be very busy for the next 24 hours and beyond, to try to keep the financial carnage to a minimum.

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