Fed Holds Secret Meeting As Bail-Ins Begin!

沒知美國想搞乜, 不過小心黑色5月!

www.silverdoctors.com全文

In the morning hours of Friday, we got word that the Fed was to have a closed meeting with its Presidents and Governors.  Supposedly this meeting was to discuss their interest rate but as I told you on Friday, they generally meet on an emergency meeting if something big has transpired.  The we learned today that Obama was going to meet Yellen.

The one big area for concern for the Fed will be banking stability. The rise in the Yen will will be catastrophic for our bankers and for the past few weeks, we have seen 3 banks trading southbound in very deep downward sloping trading:

1. Deutsche bank
2. Royal Bank of Scotland
3. Credit Suisse

with honourable mentions to Italian big bank:  Unicredit.

It sure looks to me like we had a major derivative bust over at Deutsche bank, the world’s largest derivative player at over $75 trillion!

REPORT ON JAPAN  SOUTH KOREA AND CHINA

a) REPORT ON JAPAN

 the high yen value  (low USA/Yen) is causing a special meeting at the Fed toay. No doubt we had a major derivative bust

b) REPORT ON CHINA

ii)The fun begins: the government in China shuts down a high profile P to P  (Peer to Peer)

Lending company and arrested 21 of its key personnel. You will recall that P to P  shadow banking is responsible for providing the down payment money for investors wanting to purchase a home.  We should now shortly see the bubble in the China housing sector burst:

( zero hedge)

iii)China sees its PPI drop for the 49th consecutive month as its deflation “at the gate” is spreading throughout the globe.  CPI also misses:( zero hedge)

iv) As we have indicated to you on countless occasions, the shadow banking sector is collapsing, having its bubble financing schemes blow up.  The key indicator for wealth in the Chinese economy is not the stock market but ownership of homes.  We found that in order to provide financing for the homes, Peer to Peer financing was born  ( P to P) and the amounts lent to home buyers was the 30% down payment.  Now this financing is collapsing as noticed by Bank of America:

( Bank of America/zero hedge)

4.EUROPEAN AFFAIRS

i)Such lunacy: after Denmark we now see that Belgium is now paying people to take out a mortgage:  This is the height of stupidity with negative interest rates:

( zero hedge)

ii)Let the bail ins begin.  We have been highlighting the plight of HETA bank to you for our one year.  Today they announced a 54% haircut for senior creditors and if that is not enough they will go over depositors.  Junior bond holders and equity holders are of course wiped out.  The problem is the state of Corinthia guaranteed the amounts and they just do not have the money and sovereign Austria refuses to pay.  It has been and still is, a total mess:
( zero hedge)

iii)The following Mish Shedlock discussion on the possible bailout of the Italian banks is extremely important.Today is the big meeting.

Key notes;  The total of bad Italian loans (and these are not sovereign) amounts to 360 billion euros . That is much and that should cause the entire meltdown of the Italian banks.

They are trying to create a good bank, bad bank scenario and to ring fence perennial basket case Monte di Paschi which has 50 billion euros of bad debt.  The problem here is that the new rules require a bail in and that would cause the biggest bank run in the history of Italy.  So the boys are proposing a back door solution whereby the bad debt is off loaded and then sold.  The problem is that the selling must be done at fair market value..good luck to them on that point.
we will be watching this intensively

( Mish Shedlock)

v)Germany, is reported to be very angry that the ECB is contemplating “helicopter money” as QEs just do not work.  Do not read too much into this:  Germany is benefiting greatly from the ECB policies as their balance sheet would be terribly offside if there was no QE,
( zero hedge)