While the attention of the planet brought to Syria, where government forces clear Aleppo from militants, and Brazil, where the Olympics starts, the financial system of the West continues inexorably sliding into the abyss.
Deutsche Bank, Germany’s largest Bank, is in agony. The Bank’s shares, which in 2007 was trading at $ 146 per share, the last few years are blown away with acceleration — now the stock has sunk to the level of $ 13. Investors comparing the German giant with the late Lehman Brothers, an American giant, whose shares in the months before the bitter end showed similar dynamics.
Moreover. Monday of the action “Deutsche Bank” will be deleted from the Stoxx Europe 50 is one of the main European indexes. It seems that in recovery, “Deutsche Bank” no longer believe:
What would happen if Deutsche Bank will explode? We’ve discussed this a few months ago, when Bank shares are still only timidly tested the line in 15 apiece
http://fritzmorgen.livejournal.com/858332.html
On the Bank’s balance sheet is more than 60 trillion of the derivatives, is about one hundred times more than the bad debt started the crisis of 2008 “Lehman”. Undermining the Deutsche Bank, this grown German “könig-bomb” will leave, perhaps even a stone of the entire Western financial system “Deutsche Bank” too big to hope for a controlled collapse.
Can the Germans to delay the inevitable?
Yes, you can. The recipe is the same: print money and give to banks like “Deutsche Bank” and smaller entangled in debt structures. However, while the Germans only grease the printing press, preparing to move into afterburner mode, the Japanese are already launching the helicopters with the money:
On Tuesday, Prime Minister of Japan has approved the injection in a comatose economy of 28 trillion yen (274 billion dollars). Interestingly, part of this money will go not global speculators, and the poor Japanese people — 22 million people with low incomes will receive a lump sum of $ 150.
What to expect the Japanese?
They hope that the money will be spent this time in the country, which will revive the business and allow some more pulled terminally ill Japan’s economy.
In part, these hopes are justified. Indeed, the so-called “helicopter money” — the practice of distributing the newly printed money directly to the population — can not accelerate inflation, and this is what the Japanese authorities want.
The problem however is that control called helicopter money, inflation will be difficult. If you put the wet bill into one hundred dollars in a fire, she will quickly dry out. Here only not the fact that you will have time to remove the bill from the flames to the point, as it will burn.
Inflation, in fact, already now slowly seeping to the West of pyramid schemes in the real world. A vivid example — the guy from San Francisco whose pay is not enough for decent housing, and are forced therefore to live in tiny prehistoric huts, and even paying $ 1,000 per month rent.
Helicopter money would dramatically accelerate this process. Simply put, if previously printed money disappeared without a trace in the coffers of the speculators, and the price of hamburgers almost did not grow, but now will grow and the price of hamburgers. In this case we are not talking about inflation, say, 20% or 40% per annum. Money is printed so that to make ends meet will only allow hyperinflation, inflation is not even in hundreds but in the thousands of percent.
Frightening is this prospect of the Japanese government?
I’m not sure. Japan, unlike the USA, 1945 was a defeated country, with all its consequences. Japan never lived lavishly, as much of the money she had various implicit methods to pass in the United States.
The “reset” of the global financial system, perhaps even will play Japan on hand: a painful restart the Japanese economy may be a bitter medicine that will allow the Japanese to escape from the need to pay tribute to the States and bring the economy to a steady “plus”.
However, of course, the Japanese authorities put off a thrilling moment of crisis, struggling — with the help of helicopter money and with the help of POPS. What is the purpose?
Yes, just not to be first. If the first screw of the European Union with its “Deutsche Bank”, the Japanese politicians will be much easier to justify to the voters.
