Street Talk - Deutsche Bank In BIG Trouble; Portfolio Cracking?

Is Deutsche Bank The Next Lehman?

Looking back at the Lehman Brothers collapse of 2008, it’s amazing how quickly it all happened.  In hindsight there were a few early-warning signs,  but the true scale of the disaster publicly unfolded only in the final moments before it became apparent that Lehman was doomed.

There were few early indicators of Lehman’s plight.   Insiders however, were well aware:   In late 2007, Goldman Sachs placed a massive proprietary bet against Lehman which would be known internally as the “Big Short”.  (It’s a bet they would later profit from during the crisis).

In the summer 2007 subprime loans were beginning to perform poorly in the marketplace.  By August of 2007, the commercial paper market saw liquidity evaporating quickly and funding for all types of asset-backed securities was drying up.

But still — even in late 2007,  there was little public indication that Lehman was circling the drain.

Read More.

Street Talk

"Bonds Are Their Achilles Heel"

NOW End Game Stage of Fossil Energy

We Are Now in the Terminal Stage of Our Fossil-Fuel Addiction

 Senior politicians in both parties have become so intoxicated by the idea of an American surge in energy production that they have lost their senses.



By Michael T. Klare 

(The Nation) – Of all the preposterous, irresponsible headlines that have appeared on the front page of The New York Times in recent years, few have exceeded the inanity of this one from early March: “US Hopes Boom in Natural Gas Can Curb Putin.” The article by normally reliable reporters Coral Davenport and Steven Erlanger suggested that, by sending our surplus natural gas to Europe and Ukraine in the form of liquefied natural gas (LNG), the United States could help reduce the region’s heavy reliance on Russian gas and thereby stiffen its resistance to Vladimir Putin’s aggressive behavior. 

Forget that the United States currently lacks the capacity to export LNG to Europe, and will not be able to do so on a significant scale until the 2020s. Forget that Ukraine lacks any LNG receiving facilities and is unlikely to acquire any, as its only coastline is on the Black Sea, in areas dominated by Russian speakers with loyalties to Moscow. Forget as well that any future US exports will be funneled into the international marketplace, and so will favor sales to Asia where gas prices are 50 percent higher than in Europe. Just focus on the article’s central reportorial flaw: it fails to identify a single reason why future American LNG exports (which could wind up anywhere) would have any influence whatsoever on the Russian president’s behavior. 



The only way to understand the strangeness of this is to assume that the editors of the Times, like senior politicians in both parties, have become so intoxicated by the idea of an American surge in oil and gas production that they have lost their senses.

As domestic output of oil and gas has increased in recent years—largely through the use of fracking to exploit hitherto impenetrable shale deposits—many policymakers have concluded that the United States is better positioned to throw its weight around in the world. “Increasing US energy supplies,” said then-presidential security adviser Tom Donilon in April 2013, “affords us a stronger hand in pursuing and implementing our international security goals.” Leaders in Congress on both sides of the aisle have voiced similar views. 

The impression one gets from all this balderdash is that increased oil and gas output—like an extra dose of testosterone—will somehow bolster the will and confidence of American officials when confronting their foreign counterparts. One former White House official cited by Davenport and Erlanger caught the mood of the moment perfectly: “We’re engaging from a different position [with respect to Russia] because we’re a much larger energy producer.”

It should be obvious to 
anyone who has followed recent events in the Crimea and Ukraine that increased US oil and gas output have provided White House officials with no particular advantage in their efforts to counter Putin’s aggressive moves—and that the prospect of future US gas exports to Europe is unlikely to alter his strategic calculations. It seems, however, that senior US officials beguiled by the mesmerizing image of a future “Saudi America” have simply lost touch with reality.

Read More

The Marc Faber Blog Childish Remarks: "The FED Asset Purchase Disaster?"

The Marc Faber Blog : Childish Remarks -The Asset Purchase programme of the Fed has been a complete Disaster

Doctor Faber's conclusions are first premature and more than likely wrong. 

In fact, it will be difficult to measure how effective Fed policy has been or will be as history has yet to unfold. Had Uncle Ben not implemented this program, then interest rates no doubt would be much higher than they are today. There are a lot of very nervous long-bond holders who were obviously more than happy to pass their holdings back to the Fed. Everyone is living in fear of a sharp spike in the long rates that would absolutely clobber the principal market value of these bonds.

But QE is not just about keeping rates low, it is also a crafty way to hold asset values in place, including the equity market. This may actually be its main purpose. The last thing the Fed and Obama needs is to have huge bond losses realized and recorded by banks, portfolios, and other financial intermediaries.

Such losses would vacuum up all the liquidity in the repo, bond and money markets faster than Lehman's 2008 debacle, as well as knocking the proverbial crap out of their respective equity boxes. Think about it - this prevention is moping up about 40 billion (possibly more) monthly in marked-to-market accounting losses that would be caused by sharp rate  increases.

Like the Fed we are holding back a few cards here, but in all likelihood, there is more to the Fed's QE policy actions than meets the eye - and Marc should be a little more careful with his remarks - they come across as premature and childish! 

And that's being kind.

Dr Peter G Kinesa 
August 28, 2013 

Marked to QE Market

Uncle Ben's Converted Losses 

                

PLATINUM WEALTH PARTNERS - #APPLE #FACEBOOK #BUFFET #TORONTO

PLATINUM WEALTH PARTNERS:

Week Ended, August 18, 2013

DR. PETER G. KINESA'S
INTERNATIONAL INSIGHTS

"PLATINUM WEALTH PARTNERS"

VISIT OUR WEBSITE

PLATINUM WEALTH PARTNERS

www.pwa2100.blogspot.com

APPLE Drifts Without Jobs

 - Says Oracle CEO

Many months# ago we actually concluded that without Steve Jobs the company would not be able to repeat or meet the achievements or expectations of its founder. There is an artistic-creative element in people of Steve's character that cannot be replicated by professionally trained managers from Ivy-league business schools. 

Moreover, entrepreneurial vision and drive is a talent few ever configure in a similar way. 

So whether its Ford, Buffet, Carnegie, Gates, Stronich or Jobs, their unique compositions are rare and the companies they build and run are never the same once they move on.

Keeping Apple on the watch list, but our vision for the future remains short-sighted.

INVESTORS' INSIGHTS

First Financial Insights

August 16, 2013

# The Dr Peter G Kinesa Blog -  Where Marc Faber Sees Apple (APPL) Going

Doghouse- is that what I dressed for?

Facebook Executive Dumps Shares

One primary rule of investing - when the Company's top executives start dumping their shares, it's time to head for the hills. We are not going to set out all the reasons why and all the excuses executives use to justify their dispositions. Nope, instead we are going to ask you to look at the fellow captioned above and ask "what if this guy started dumping shares in that small town company from Omaha?" 

Never happened, and if it did - you know that the flood waters are really coming. 

It all boils down to how do you believe in folks that do not believe in themselves? Just plain-old folksy small-town stuff. There is however-  one City-slicker - Jimmy Rogers, who thinks that Facebook is not an investment, its a waste of time. We agreed with him then, and still do. 

This also may explain why Facebook users are so depressed - they finally figured out Jim's astute observation.

Stockholders may soon join its users, as t is still just a click away from ten or less, on the Ticker. 

INVESTORS' INSIGHTS

First Financial Insights

August 14, 2013 

WISE GUY

" Facebook is not an investment, it's a waste of time" 

Now if you think that I have any thing further to say here or want to challenge these two guys on their stock wisdom,  you do not know me yet. Let's face (sic) it, if Facebook is our leading technology company, then we are in a heap of trouble. Seems like some of their top executives think the same way too. Imagine if the President said, "but, after this - I am leaving America"

There is something in good-ole small-town wisdom that appeals to me. Right Zeke?

PLATINUM WEALTH PARTNERS

Dr. Peter G Kinesa

August 14, 2013

Sure Zeke, l'll BFF you????

FIRST FINANCIAL INSIGHTS: #TORONTO CONDO BUBBLE CRASHING  

TORONTO CONDO bubble CRASHING – WHAT NEXT? - READ MORE   2008 Meltdown or Japanese Bubble... (read more)

When will they ever learn? Or is it simply in the nature of our species to always create these gigantic credit-driven asset bubbles? And why is it a social phenomenon that no country, culture or region is immune to through-out history? 

From a investment view, we are seriously perturbed about Toronto's Condo Bubble and the possible outcomes that could occur when the bubble further deflates. As a result, we have placed a number of sectors on our watch list; obviously including  retail, financial, property development and construction industries. In the weeks ahead, we will provide further.comments and analysis regarding the much anticipated fall-out with more specific industry assessments.  

Remember also how globalization was sold to us as the best way to improve national economic well-being, standards of living, create jobs and lower risk levels. Now everything is so deeply inter-connected financially, physically and politically, yet these promised improvements seem to be moving us in the opposite direction. Do you think it was all a big lie serving a few special global interests? Do you think that they pulled the wool over the eyes of our political geniuses?  If you do - then you are not alone!

It begs the question - who is really governing sovereign nations given all the operative trade agreements, and organizations, such as the WTO, EU, IMF, World Bank and others, with relegated powers? Have all these supra-constitutional connections watered-down sovereign constitutions so much that national destinies have been moved beyond elected officials' powers? This may explain why Canada patterned its monetary policies after the FED - they have to!

This is a big issue that requires a good deal more analysis and thought, but there are clear hints that "globalization" was just a crafty synonym disguising "annexation". What does that have to do with the price of Condo's in Toronto?

Lots! Just ask its Mayor.   

  

INVESTORS' INSIGHTS

First Financial Insights

August 12, 2013

Asset Bubbles 101: 

In the end, remember nothing is...

  

What everyone should come to understand in the age of globalized economies is that no country, region or city is completely immune from the trends and events that occur around the planet. More so in the years ahead when shrinking raw material supplies and food stocks cause more unrest and political strife.In all likelihood making the originating shortages worse and causing spikes in CPI and accordingly the borrowing costs set by markets. 

Therefore, cities like Toronto may experience seemingly immune short-term booms, but the hardships of marginal countries ripple back, sooner or later . And as more and more countries are affected by climate change, resource shortages, social and political tensions, booms may actually become just pages in economic history books.Why? Because abstract economic theory's positive-sum-game is moving rapidly towards a head-on collision with existential economic theory's negative-sum-game. Somehow, reality has a way of defeating the wild speculations of old-age stories, as physics and mathematics are absolutely concrete in construction.

Having that in mind, we should be concerned that as the population-resources-depletion formula worsens we do not blindly fall into the "exponential economic trap". Illustrated by the simple idea.that when an element doubles with every unit measure of time, then at one minute to 12 its glass is half full -  fooling one to think a lot more time remains. What happens next is clear, but perhaps not so clear if the concept is ignored or misapplied. The exponential function in itself sets hard non-negotiable constraints on all asset bubbles, and also total physical economic outputs. We must remember not to forget the implications of this function and its real, but invisible existential constraints.

If we do, the clock says there won't be much, if any, time to fix the situation. This function is plainly ruthless.

PLATINUM WEALTH PARTNERS

Dr. Peter G Kinesa

August 13, 2013