Sunday, October 09, 2016

Raoul Pal: 
Deutsche Bank Is Not Lehman Brothers,
There Is A Bigger Isuse At Stake
"Is it a Lehman Brothers crisis? I think, somebody interestingly put it to me, it's like, it can't be, because the problem with Lehman Brothers was Dick Fuld's arrogance of reaching a deal with somebody. In this situation, I don't think anybody's going to get in that situation. Nobody's playing the kind of Wall Street, puff-chested, master of the universe. The problem we've got here is, nobody knows what the outcomes are and who can do anything about it .. So will they find some sort of fudged way of doing it again? Yeah. Will they find some way of maybe a third party, supernational to hold the stakes in the banks? But basically, in the end, whatever the outcome is, there may not be a big bang. But the ownership of these banks is going to change from private hands to state hands, in one way, shape, or form. And basically, it's the nationalization of the banking system, which is the end of the Trail of Definancialization of the global economy that we're seeing. We're seeing it everywhere. The whole finance economy is shrinking. And it had to shrink – got too big as a percentage of world GDP. And it's going down. And I think somehow, this will all get amalgamated into either government or third-party balance sheets, so the ECB can fund it. You know, it's a mess. And it's still got a long way to play out, I think."
link here to the article

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