Analyzing and reading the experts view on the current situation of Deutsche Bank to that of Lehman Brothers in 2008. Many of them are emphasizing and argue that 2008 is back.
I will argue that the current situation is the iconic milestone of the clear END of the 2008 crisis. Here is my argument:
What was the Lehman Crisis about? In September 2008, we were facing an under-regulated banking sector and fears of rising interest rates (due to presumed inflation generated by USD 140 oil prices).
What is the current Deutsche Moment about? In September 2016, we are facing an over-regulated banking sector (the US Department of Justice throwing an USD 14bn fine at Deutsche Bank) and fears of never rising quasi-zero (in Germany even negative) interest rates. Continue reading “Is the 2008 Lehman Moment Back ?”
Recently Jörg Bibow was interviewed have tried to put the points in English stating that Mario Draghi’s announcement promise of ECB support for government bond markets seems to have calmed fears of an imminent euro breakup, at least for the time being. That does not mean the euro crisis is over though. Not at all, as the underlying problems remain largely unresolved. Liquidity can buy time but it cannot solve the imbalances inside the euro area and related debt overhangs that are the deeper cause behind the euro crisis. It is important in this context that the ECB promise is for conditional support. Continue reading “The Euro Crisis not over”