What is truth?

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Deutsche Bank’s war of words with the ECB is not new: it was first unveiled in February when, as we wrote at the time “A Wounded Deutsche Bank Lashed Out At Central Bankers: Stop Easing, You Are Crushing Us.” Europe’s largest bank, with the massive derivatives book, then upped the ante several months later in June, when its chief economist Folkerts-Landau launched a shocking anti-ECB rant in which it warned of social unrest and another Great Depression.

Ironically, these infamous diatribes hurt more than helped: telegraphing to the market just how hurt DB was as a result of the ECB’s monetary policy, the market punished its stock, which has been recently trading within spitting distance of all time lows, in effect making Deutsche Bank’s life even harder as it now has to contend not only with its own internal profitability problems, but also has to maintain a market-facing facade that all is well. So far, it has not worked out very well, prompting numerous comparisons to another infamous bank.

 

So, in what may have been DB’s loudest cry for help against the ECB’s unwavering commitment to rock-bottom interest rates, the bank’s CEO, John Cryan, warned in a guest commentary ahead of the Handelsblatt Banking Summit titled, appropriately enough “Banks in Upheaval”, to be held in Frankfurt on August 31 and September 1, that “monetary policy is now running counter to the aims of strengthening the economy and making the European banking system safer.

However, his most striking warning was not aimed at Mario Draghi, but at Germany itself – and ostensibly his own clients – implicitly suggesting that if Deutsche Bank goes down it is taking everyone down with it, when, as cited by Bloomberg, he warned of “fatal consequences” for savers and pension plans while “companies refrain from investments due to ongoing uncertainty and demand less loans.”

The details are known to those who have followed the paradox of central bank failure – if only for the economy and ordinary people –  summarized earlier today by Citi’s Matt King.

Quoted by Handelsblatt, Cryan warned that “the ECB’s policy is squeezing the margins of Europe’s struggling banks, making it harder for insurers to find profitable investments and dangerously distorting financial market prices.” Meanwhile, he added, the hoped-for benefits haven’t materialized. “Given the continued uncertainty, companies are holding back on investments and are hardly seeking any credit anymore,” he wrote.

He added that it was unacceptable that financial regulators demanded that banks increase their safety cushions but then imposed punitive interest rates on these additional reserves.

Many agree with Cryan:”The hoped for pan-European investment boost hasn’t happened, and neither have the expected structural reforms in the affected euro member states,” said Georg Fahrenschon, president of the German Savings Bank Association. Instead, uncertainty is growing throughout the euro zone in light of the “horrendous sums of money the ECB is now directly pumping into the markets,” he added.

While Cryan admits that the ECB’s intervention did avoid an all out collapse in Europe it has done so at extreme costs, like negative rates on most German debt. Which is why, Cryan writes it is high time for a change in direction at the ECB. He would say that: his bank is in the midst of a painful restructuring and battling to keep the confidence of investors, so the side effects of the ECB’s policy are causing it particular pain. That’s one reason why Mr. Cryan is particularly critical of the negative interest rate on bank deposits at the ECB. He said net interest income, traditionally the most important pillar of bank earnings in the euro zone, had fallen by 7 percent since 2009.

full article at source:http://www.zerohedge.com/news/2016-08-24/deutsche-bank-ceo-warns-fatal-consequences-savers

comment:

Tip to all Irish savers : If you have money in Allied Irish Bank or even worse Bank of Ireland Get it out NOW !

“Towards Truth”

I am great-full to my good friend Christopher  M. Quigley for sending me this copy for his e-book ” Towards Truth ”  I consider this a must for all seekers !

“The symbol of the Unicorn: The physical world is an allegory of spiritual truth.”

Joining The Dots I have been counseling friend s and family for over two decades following personal search, self-training and private erudition and education. In general I believe over specialization is an error in this post-industrial world. In thought and in spirit we have become atomized. This fracturing of the individual is resulting in the disintegration of personality, mental health, personal effectiveness, happiness and social cohesion. Faulty understanding brings with it erroneous analysis. This leads to wrong conclusions and frustrated endeavor. We need to start “joining the dots” and thinking for ourselves. We need to stop being naive in our thoughts and actions. I recommend that you read comprehensively and transcend the “SUB-SET MODEL” we have been brainwashed into. Herein I have listed some books (with quotes and personal summaries and essays where possible) that have helped me to start to think for myself and pass through the veil that is contemporary “conditioning”. I hope it motivates to commence your own journey of self-realization and conscious growth leading to a new awareness and peace of mind.

Carl Gustav Jung Self-Knowledge: Expressed in the language of Hermetic philosophy, the ego-personality’s coming to terms with its own background, the shadow, corresponds to the union of spirit and soul in the Unio Mentalis, which is the first stage of the coniunctio. What I call coming to terms with the unconscious the alchemists called “meditation.” The Unio Mentalis, then, in psychological as well as in alchemical language, means knowledge of oneself. In contradistinction to the modern prejudice that selfknowledge is nothing but a knowledge of the ego, the alchemists regarded the self as a substance incommensurable with the ego, hidden in the body, and identical with the image of God.

What the alchemists sought, then, to help him out of his dilemma was a chemical operation which we would today describe as a symbol.

 Historical and scientific criteria do not lend themselves to recognition of mythological truth; it can be grasped only by the intuitions of faith or by psychology, and in the latter case although there may be insight it remains ineffective unless it is backed by experience.

Thus the modern man cannot even bring about the Unio Mantalis unless he learns to actually accept the fact of his dreams and fantasies and begins to engage with them. This is where insight, the Unio Mentalis, begins to become real. What you are now creating is the beginning of Individuation, whose immediate goal is the experience and production of the symbol of totality.

The Individuation process subordinates the many to the one. But the One is God, and that which corresponds to him in us is the Imagio Dei, the God image. The God-image expresses itself in the mandala.

The political and social isms of our day preach every conceivable ideal, but, under this mask, they pursue the goal of lowering the level of our culture by restricting or altogether inhibiting the possibilities of individual development. They do this partly by creating a chaos controlled by terrorism, a primitive state of affairs that affords only the barest necessities of life and surpasses in horror the worst times of the so-called Dark” Ages. It remains to be seen whether this experience of degradation and slavery will once more raise a cry for greater spiritual freedom. The problem cannot be solved collectively, because the masses are not changed unless the individual changes. At the same time, even the bestlooking solution cannot be forced upon him, since it is a good solution only when it is combined with a natural process of development. The bettering of a general ill begins with the individual, and only when he makes himself and not others responsible.

Individuation helps this process towards authenticity by balancing the unconscious and the conscious through the medium of the Self rather than the Ego. This involves allowing the matter of the unconscious to be absorbed by the Ego. This matter can be dreams, or fantasy or moods. Through this focusing on the unconscious the center of the personality shifts from an Ego basis to a Self basis. This allows for greater unity, balance, creativity, freedom, energy, courage and synergy.

Thoughts On Good And Evil: (Memories, Dreams, Reflections) Light is followed by shadow, the other side of the creator. This development reached its peak in the twentieth century. The Christian world is now truly confronted by the principle of evil, by naked injustice, tyranny, lies, slavery, and coercion of conscience. Evil has become a determinant reality. It can no longer be dismissed from the world by a circumlocution. We must learn how to handle it, since it is here to stay. How we can live with it without terrible consequences cannot for the present be conceived. In any case, we stand in need of a reorientation, a metanoia. Therefore, the individual who wishes to have an answer to the problem of evil, as it is posed to-day, has need, first and foremost, of self-knowledge, that is, the utmost possible knowledge of his own wholeness.

Our (Christian) myth has become mute, and gives no answers. The fault lies not in it as it is set down in the Scriptures, but solely in us, who have not developed it further, who, rather, have suppressed any such attempts.

The unavoidable internal contradictions in the image of a Creator-god can be reconciled in the unity and wholeness of a self as the coniunctio oppositorium of the alchemists or as a unio mystica. In the experience of the self it is no longer the opposites “God” and “man” that are reconciled, as it was before, but rather the opposite with-in the God-image itself. That is the meaning of divine service, or the service which man can render to God, that light may emerge from the darkness, that the Creator may become conscious of His creation, and man conscious of himself.

By virtue of his reflective faculties, man is raised out of the animal world, and by his mind he demonstrates that nature has put a high premium precisely upon the development of consciousness. Through consciousness he takes possession of nature by recognising the existence of the world and thus, as it were, confirming the Creator.

Meaninglessness inhibits fullness of life and is therefore equivalent to illness. Meaning makes a great many things endurable – perhaps everything………..

see full e book in PDF doc here eBook-Towards Truth – – and Here https://www.scribd.com/document/239407264/Free-eBook-Towards-Truth

sent in to us today :

Dear Minister Noonan,

I attach below an article which appeared in the Sunday Times Business section yesterday 21st August 2016. It outlines how Vulture Funds are receiving 58% discount on mortgage purchases while families are being refused such grace and favour.

I realize that your department is very busy and in no way do I mean to be personally disrespectful but is it not tragic that vulture funds are being granted discounts while families are not?

I understand that this is so because it is politically easy. However, allowing this to occur means that 50,000 families are now exposed to Vulture Fund harassment. Their tactics are rapacious, sometimes involving 10 -20 phone calls a week to family homes and business phone numbers. As a result families are being torn apart, folks’ physical and mental health is being destroyed, the demand for rental accommodation is increasing and in some cases suicide is ensuing.

Please sir I beg you to stop this policy in this state. Have your department, along with the Central Bank, draw up politically acceptable protocols which can “weed out” strategic defaulters from genuine financial hardship. It will not be easy but surely the end justifies the means and is fair and just and proper.

Deposits at Bank of Ireland are soon to face charges in the form of negative interest rates after it emerged on Friday that the bank is set to become the first Irish bank to charge customers for placing their cash on deposit with the bank.

This radical move was expected as the European Central Bank began charging large corporates and financial institutions 0.4% in March for depositing cash with them overnight.

Bank of Ireland is set to charge large companies for their deposits from October. The bank said it is to charge companies for company deposits worth over €10 million.

The bank was not clear regarding what the new negative interest rate will be but it is believed that a negative interest rate of 0.1 per cent will initially be charged to such deposits by Ireland’s biggest bank.

BOI recently failed the EU stress tests and is seen as one of the most vulnerable banks in the EU – along with Banca Monte dei Paschi di Siena (MPS), AIB and Ulster Bank’s parent RBS. All the banks clients, retail, SME and corporates are unsecured creditors of the bank and exposed to the new bail-in regime.

Irish_banks_stress_tests

 

Only larger customers will be affected by the charge for now. The bank claims that it has no plans to levy a negative interest rate on either personal or SME customers but negative interest rates seem likely as long as the ECB continues with zero percent and negative interest rates. Indeed, they are already being seen in Germany where retail clients are being charged 0.4% to hold their cash in certain banks such as Raiffeisenbank Gmund am Tegernsee.

The news came days after it emerged that FBD, one of Ireland’s largest insurance companies, have been moving cash out of Irish bank deposits and into bonds. Fiona Muldoon, the FBD CEO cited extremely low returns on deposits and bail-ins as the reason they were withdrawing cash from Irish banks and diversifying into corporate and sovereign bonds. Muldoon said as reported by the Irish Independent that

“As they mature, and as the bank bail-in rules come into play, it’s no longer the case that for corporate investors depositing at a bank is risk free,” she added.
“To be honest, the return is abysmal now. We’ve gone back to a more typical investment portfolio for an insurance company.”

“You have to be paid for the risk you take,” she added. “You might entertain the bail-in risk if you were being properly paid. But if you’ve a bank trying to charge you for leaving your money with them, you’re not inclined to take any risk at all.”

The monetary policies being pursued by the ECB and other central banks is making deposits, banks and the banking system vulnerable. Central bank policies are contributing to individuals and companies withdrawing deposits from banks which is making already fragile banks even more fragile.

It is important to note that while there are “deposit guarantees” in place in most jurisdictions in the EU, these guarantees are only as good as the solvency of the nation providing them. Many nations in the EU remain insolvent or at least border line insolvent. Thus, the deposit guarantee level of €100,000 in many EU states and £75,000 in the UK is likely to be arbitrarily reduced to lower levels in the event of deposit “haircuts” in the next banking and financial crisis.

Prudent retail, SME and corporate clients are realising the increasing risks facing their deposits. They can no longer afford to simp………..

full article at source: http://www.zerohedge.com/news/2016-08-22/irelands-biggest-bank-charging-depositors-negative-interest-rate-madness

 

Deposit bail-in risks are slowly being realised in Ireland, after it emerged overnight that FBD, one of Ireland’s largest insurance companies, have been moving cash out of Irish bank deposits and into bonds.

Revelations regarding deposit bail-in risks came in the wake of warnings of a new property crash centred on the housing market in Ireland. The former deputy governor of the Central Bank warned in an op-ed in a leading international financial publication, Project Syndicate, that Ireland is at risk of another housing market crash.

Insurer FBD has moved over €150 million out of the Irish banking system and into corporate and sovereign bonds over the past year. The move was prompted by low returns offered by bank deposits and the risks that deposit bail-in rules could see deposits confiscated.

FBD chief executive Fiona Muldoon told the Irish Independent that the “extremely low returns offered on term deposits by banks, coupled with fears that new bail-in rules introduced this year by the European Union could expose bank bondholders and depositors to bailing out a failed lender, meant it has shifted investments away from banks.”

The new deposit bail-in mechanism is designed to protect banks and is touted as a way to prevent taxpayers being liable for bailing out collapsed lenders. It is believed that it leaves bank bondholders and deposit customers with more than €100,000 on deposit at risk of footing the bill.

There is a belief that bail-ins only relate to “the wealthy” and “rich” depositors as they will be imposed on those with deposits greater than national deposit guarantees. These deposit “guarantees” are generally the ‘big round’, arbitrary number of say €100,000, $250,000 and £75,000. These are not particularly large amounts and could amount to the entire life savings of a pensioner, a family or indeed it could be the entire capital of a small to medium size business enterprise.

An example of this is the UK where the deposit guarantee was arbitrarily, suddenly and with little fanfare quietly reduced from £100,000 to £75,000 just last year in July 2015.

Thus, it is important to note that the arbitrary round number in the various government deposit guarantees can be, and probably will be, reduced to a lower number – say the new round number of €50,000, £50,000 and $50,000 –  depending on the severity of the next banking crash.

In the event of bail-ins, governments and banks are likely to seek to impose deeper haircuts on creditors including depositors in order to bail-out and protect the failing banking system.

FBD’s deposits with Irish banks were reduced from €451 million to €305 million in recent months. FBD made a €3.1m loss in the first half of the year.

As reported by the Irish Independent:

“As they mature, and as the bank bail-in rules come into play, it’s no longer the case that for corporate investors depositing at a bank is risk free,” she added.
“To be honest, the return is abysmal now. We’ve gone back to a more typical investment portfolio for an insurance company.”

“You have to be paid for the risk you take,” she added. “You might entertain the bail-in risk if you were being properly paid. But if you’ve a bank trying to charge you for leaving your money with them, you’re not inclined to take any risk at all.”

The recent bank stress tests showed that Irish banks are the most vulnerable in the EU in the event of another financial crisis.

Meanwhile, the risk of another property crash centred on the housing market has been warned of by a respected economist. Stefan Gerlach, who left the Central Bank of Ireland earlier this year to become Chief Economist at BSI Bank in Zurich, asked:

“Having endured the collapse of its housing market less than a decade ago, Ireland has lately been experiencing a blistering recovery in prices, which already have risen in Dublin by some 50% from the trough in 2010, is Ireland setting itself up for another devastating crash?”

Among the concerns he expresses in an article titled ‘The Return of Ireland’s Housing Bubble’ for the global finance think-tank Project Syndicate is that the Central Bank here is coming under undue pressure from the construction industry and politicians to relax the loan to value and loan to income ratios on mortgage lending it introduced last year.

He warns that while housing bubbles are easy to spot, there are a number of conflicts of interest that make it hard to take action as the market gets out of control as reported by Newstalk:

“The obvious question is why nobody stepped in before it was too late. The answer is simple: while the bubbles are inflating, many people benefit. With the construction sector thriving, unemployment falling, and banks lending freely, people are happy – and politicians like it that way.”

“Many in Ireland might find that conclusion overly pessimistic. Maybe they are simply hoping that, this time, the luck of the Irish will hold. Perhaps it will, and this time really is different. But there isn’t much evidence of that,” he concludes.

The ‘Bail-in regime’ is one of the greatest financial risks to investors, savers and indeed companies internationally today. Yet it remains the most poorly covered financial risk and is largely ignored by financial advisers, brokers and not surprisingly governments and banks.

The growing financial risk in all western countries has not been properly analysed. In a world already beset with huge deflationary pressures and still insolvent banks, the bail-in regime and confiscating deposits, especially from job creating companies, would be extremely deflationary and would likely contribute to severe recessions.

This is something we warned of when we first conducted our extensive research on the developing global bail-in regimes after the Cyprus bail-ins in 2013. Diversification of deposits remains vital and one important way to protect against a bail-in is owning physical gold. Taking delivery of gold coins and bars and owning bullion in allocated and segregated storage in the safest vaults in the world is a prudent way to protect against the deposit bail-in regime.

Gold and Silver Bullion – News and Commentary

Gold Rises as Fed Rate Hike Bets Recede, Dollar Near June Low (Bloomberg)

Gold steady as U.S. data lowers rate hike prospects (Reuters)

Latest gold, forex rates in UAE (Emirates247)

Bail-in deposit fears spur insurance company move to bonds (Independent)

Ireland warned of new property crash  (Independent)

full article at source:http://www.zerohedge.com/news/2016-08-15/deposit-bail-warning-ireland-bail-risk-uk-very-high

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