Ignition – Meltdown!


Global Financial Meltdown Coming? Clear Signs That The Great Derivatives Crisis Has Now Begun

By Michael Snyder, on October 7th, 2015

… While things may seem somewhat calm on Wall Street … trouble is bubbling just under the surface.  As you will see below, something happened in mid-September that required an unprecedented 405 billion dollar surge of Treasury collateral into the repo market.  …  It appears that some very large institutions have started to get into a significant amount of trouble because of all the reckless betting that they have been doing.  This is something that I have warned would happen over and over again.  … This is what is going to cause the meltdown of our financial system. …

One very large financial institution … Glencore was considered to be the 10th largest company on the entire planet, but now … from Zero Hedge

Of particular concern, they said, was Glencore’s use of financial instruments such as derivatives … . The company had $9.8 billion in gross derivatives in June 2015, down from $19 billion … .

According to Bank of America, the global financial system has about 100 billion dollars of exposure overall to Glencore. … likely candidate to be “the next Lehman Brothers”.

And it isn’t just Glencore that is in trouble. …

For the banks, of course, Glencore may not be their only exposure in the commodity trading space. We consider that other vehicles such as Trafigura, Vitol and Gunvor may feature on bank balance sheets as well ($100 bn x 4?)

Call it half a trillion dollars in very highly levered exposure to commodities: an asset class that has been crushed in the past year.

The mainstream media is not talking (but) when I came across the (following) I was absolutely stunned.  It comes from Investment Research Dynamics, and it shows very clearly that everything is not “okay” in the financial world…

Something occurred in the banking system in September that required a massive … largest ever Treasury collateral injection into the repo market (graph). … Spikes up in the amount of reverse repos … tend to correspond the some kind of crisis (like) in 2008 …

(The) article that I just quoted links the troubles at Glencore with this unprecedented intervention. … The spike-up in reverse repos occurred at the same time – September 16 – that the stock market embarked on an 8-day cliff dive, … around the same time that a crash in Glencore stock and bonds began.  …

Back in 2008, … there were problems brewing under the surface well in advance. Well, the same thing is happening now at banking giants such as Deutsche Bank, and at commodity trading firms such as Glencore, Trafigura and The Noble Group. … Meanwhile, our “leaders” continue to tell us that there is nothing to worry about. …

(Consider also Deutsche Bank in the following article, Bundesbank Tries To Reassure Re Gold Reserves as Deutsche Bank Shocks With €6 Billion Loss Warning, by  GoldCore on 10/08/2015, and Day After DeutscheBank Admits Not All Is Well, Swiss Giant Credit Suisse Also Admits It Needs More Cash, Tyler Durden on 10/08/2015; and Saudi Arabia Declares Spending Moratorium As Oil Rout Bankrupts Kingdom, Tyler Durden on 10/08/2015, and Fed Taking Emergency Crisis Measures … Shoving Collateral Onto Banks’ Balance Sheets  by WashingtonsBlog)

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About icliks

Biding my time in central ms ... yours too, if ur reading this.
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