In a surprising development, a group of plaintiffs in an antitrust litigation case against Deutsche Bank, HSBC Bank plc, the Bank of Nova Scotia, and UBS AG, have just announced that Deutsche Bank is in the process of negotiating the formal terms of a settlement agreement with the plaintiffs:
It was only a matter of time…
The US probe investigating Deutsche Bank has reportedly now widened to include alleged money laundering “mirror trades” in Deutsche’s Moscow unit.
Translation: Things just ESCALATED MASSIVELY for Germany’s largest bank…
Germany’s troubled Deutsche Bank has hit the headlines once again. This time for erroneously transferring $6 billion to a hedge fund client’s account.
- Fed Reverse Repos Supernova- 3 Alarm Fire at the Fed & ECB!
- Silver Shortage Eases As Premiums Decline Slightly- Were Metals Dealers Holding Back Silver Inventories?
- Derivatives Crisis Underway? HUGE Behind the Scenes Operations Attempting to Put Out MASSIVE FIRES
- Eric Explains Why Deutsche Bank is a “Time Bomb That is Going Off at Some Point!”
The SD Weekly Metals and Markets With The Doc and Eric Dubin is Below:
The sudden big spike up in Fed reverse repos in mid-September indicate that there was a derivatives accident that required the Fed to flood the global financial system with Treasury collateral, which is used to satisfy derivatives margin calls.
DB is not only now the lethal sovereign risk of Germany, it is the sovereign risk of the entire EU.
Whereas Bear Stearns the Lehman triggered the Great Financial Collapse in the U.S., Deutsche Bank could potentially trigger the collapse of the global financial system.
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.
Could this happen to Deutsche Bank?
Physical silver bullion sales exploded at SDBullion Wednesday, hours before the London Fix price setting mechanism was set to end on August 14th.
The London fix, which has been in place for 117 years dating back to 1897, announced in April that the daily silver fix would end on August 14th, when Deutsche Bank, under investigation by Germany’s BaFin for market manipulation vacated its seat and was unable to find a buyer.
SDBullion trader Jennifer Linhart stated that physical silver sales were five times normal volume Wednesday, as investors scooped up bullion ahead of any market disruption the end of the fix might cause:
“The phones were ringing off the hook all day, and silver sales were about 5 times normal for the day. We didn’t see much of any change in gold, everyone was buying silver.”
Perhaps this is why Deutsche Bank could not find a single buyer for its seat on the London Fix: the bank, along with HSBC have been officially accused on manipulating the silver fix in a new suit filed in federal court in Manhattan over the weekend.
There have been some very interesting developments in the precious metals markets. BaFin, the German regulator came out & said that the main regulator said that precious metals are manipulated worse than LIBOR and that word “worse” is a very significant word in my mind.
Then when you think about some of the chronology for BaFin, they announced in the middle of November that they were going to investigate the possible fixing of gold prices or manipulating of gold prices on the London gold fix.
On the very next day, Deutsche Bank declined to continue being a member of the fixing of the London bullion market. When you think about what must have happened, my own feeling is that the regulator probably went back to Deutsche Bank having looked at their records and said, “Do you know what your boys in London have been doing here?” And of course the next day they quit the LBMA…
If you think about manipulation, there’s only one reason in my mind that bankers manipulate things. They don’t manipulate them for the bank to make money. They manipulate them for the employees to make bonuses.
The Financial Times reports this morning that global gold prices may have been manipulated on 50% of occasions between January 2010 and December 2013, according to analysis by Fideres, a consultancy.
The findings come amid a probe by German and UK regulators into alleged manipulation of the gold price. Prices are set twice a day by Deutsche Bank, HSBC, Barclays, Bank of Nova Scotia, and Societe Generale in a process known as the London gold fixing.
Fideres’ research found the gold price frequently climbs, or falls, once a twice-daily conference call between the five banks begins, peaks or troughs, almost exactly as the call ends, and then experiences a sharp reversal, a pattern it alleged may be evidence of “collusive behavior.”
Fideres concluded that this “is indicative of panel banks’ pushing the gold price upwards on the basis of a strategy that was likely predetermined before the start of the call in order to benefit their existing positions or pending orders.”
“The behavior of the gold price is very suspicious in 50% of cases. This is not something you would expect to see if you take into account normal market factors,” said Alberto Thomas, a partner at Fideres.
I feel that this is one of the most important investigations I’ve ever done. If my findings are correct, each of us might soon experience a severe, if not crippling blow to our personal finances, the confiscation of any wealth some of us have been able to accumulate over our lifetimes, and the end of the financial world as we once knew it. The evidence to support my findings exists in the trail of dead bodies of financial executives across the globe and a missing Wall Street Journal Reporter who was working at the Dow Jones news room at the time of his disappearance. If the bodies were dots on a piece of paper, connecting them results in a sinister picture being drawn that involves global criminal activity in the financial world the likes of which is almost without precedent. It should serve as a warning that we are at the precipice of something so big, it will shake the financial world as we know it to its core.
Although the trail of mysterious and bizarre deaths detailed below begin in late January, 2014, there are others. Not only that, there will be more, according to sources within the financial world. Based on my findings, these are not mere random, tragic cases of suicide, but of the methodical silencing of individuals who had the ability to expose financial fraud at the highest levels, and the complicity of certain governmental agencies and individuals who are engaged in the greatest theft of wealth the world has ever seen.
We appear to be witnessing a clean-up where JPMorgan and Deutsche Bankers are at the epicenter of it all.
In its current form, the London gold price fixing takes place twice each business day, at 10:30 A.M. and 3:00 P.M. in the “fixing room”.
Five individuals, one each from five major gold-trading firms, are involved in the fixing.
Each representative at the fixing keeps an open phone line to his firm’s trading room. Each trading room in turn has buy and sell orders, at various prices, from customers located all over the world. In addition, there are customers with no existing buy or sell orders who keep an open line to a trading room in touch with the fixing and who may decide to buy or sell depending on what price is announced.
The representative announces a price at which trading will begin. Each of the five individuals then confers with his trading room, and the trading room tallies up supply and demand — in terms of 400-ounce bars — from orders originating around the world. In a few minutes, each firm has determined if it is a net buyer or seller of gold. If there is excess supply or demand a new price is announced, but no orders are filled until an equilibrium price is determined. The equilibrium price, at which supply equals demand, is referred to as the “fixing price.”
As demonstrated in our Open Letter to the World Gold Council, there was a large supply-demand imbalance in 2013. The evidence presented here suggests that the decline in the price of gold in mid-2013 and the subsequent raid of gold ETFs (but not silver ETFs) was engineered by Western Central Banks to help solve their physical gold supply problem. However, the resulting increase in Indian gold demand exacerbated the problem. The solution was to restrict Indians from importing gold by all means possible in order to help the Western Central Banks regain control of the gold market.
However, the rate of drain in gold ETFs cannot continue forever; at the current pace of 930 tonnes/year, there are less than two years of gold left in ETFs. Moreover, Indians have proved highly creative at finding ways around import restrictions. Smuggling is on the rise and will most likely increase as smugglers become more sophisticated. Overall, we believe that interest in physical gold from emerging markets will remain a driving force.
Accordingly, we believe that the manipulation of gold prices by central banks, as demonstrated by the below analysis, cannot continue in 2014. Therefore, we expect substantial increases in the price of precious metals as the true shortages become obvious.
Deutsche Bank, one of the 5 banks involved in setting the daily AM and PM London fix gold prices has announced today it will quit participating in precious metals price setting due to the ongoing investigation by German authorities into alleged precious metals manipulation.
It appears that the daily price fixes may be in Jeopardy particularly in silver, as the bank’s exit would leave only HSBC and the Bank of Nova Scotia as the remaining banks involved in the daily silver fix, and reports indicate others may follow Deutsche’s lead.
Our old pal, Ned Naylor-Leyland stopped by yesterday for a wide-ranging discussion which included:
- The new German “gold price manipulation investigation” which, as noted on Friday, has been widened to include Deutsche Bank (http://www.reuters.com/article/2013/12/13/metals-probe-deutschebank-idUSL6N0JS1DK20131213)
- Empirical data which illustrates these ongoing schemes
- The new, Asian physical gold exchanges