I know. The chart of European banks borrowing US Dollars (despite the WTF spike in late September) has nothing to do with derivatives.
According to this article at Zerohedge.com:
JP Morgan’s Nicoloas Panigirtoglou warns:
In our opinion it is not so much funding issues but rather derivatives exposures that more likely to trouble markets going forward if Deutsche Bank concerns continue.
This is especially true if these concerns propagate into a confidence crisis inducing more rapid unwinding of derivative contracts.
As we have detailed previously, Deutsche has the world’s largest so-called derivatives book—its portfolio of financial contracts based on the value of other assets. As Forbes notes, it peaked at over $75 trillion, about 20 times German GDP, but had shrunk to around $46 trillion by the end of last year. That’s around 12% of the total notional value of derivatives outstanding worldwide ($384 trillion), according to the Bank for International Settlements.
* I suspect that the scale of derivatives is 5-10 times larger, and that up to half a quadrillion dollars worth of digitial financial bets are going to unwind, with countless failure by counterparties to back up their end of the financial gambling, therefore massive defaults on a scale dwarfing global GDP seems likely. Soon. Could you survive if the whole financial world was destroyed? Imagine billions of suddenly unemployed and starving people desperate for someone to offer them a solution – almost eager to give up their rights in exchange for some food and words of encouragement. Even if you don’t take the Book of Revelation seriously, please keep its description of such events in mind. I have written about this from a financial and a prophetic angle. Are you taking any precautions?
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