Sink The Banks? Deutsche Bank Credit Default Swaps Soar As ECB Raises Rates (DB’s Notional Derivatives Dwarf German GDP By A Factor >20)

confoundedinterest17 #bubble, #inflation, #wine, @MetreSteven @JeffSnider_AIP @DiMartinoBooth @bondstrategist @RaoulGMI @LukeGromen @dlacalle_IA @EconguyRosie @profplum99 @SantiagoAuFund @biancoresearch @pboockvar @SriKGlobal, Agency MBS, Bank of England, Bank of Japan, Banking, Bernanke, CMBS, CRE, Credit, Currency, ECB, Economy, Existing Home Sales, fannie mae, Fed, France, Freddie Mac, GDP, Germany, Gold, Inflation, Italy, Oil, Powell, REITs, russia, Silver, SPX, Stocks, Treasuries, Treasury, Uncategorized, Wages, Yellen, Yield Curve March 27, 2023 1 Minute

Are central banks like The Federal Reserve and European Central Bank ({ECB) sinking the banks?

Deutsche Bank, Germany’s largest bank (eerily like Germany’s World War II battleship The Bismarck) is seeing a blow out in its 1-year credit default swaps (CDS) as the ECB cranks up it main refinancing rate to fight inflation.

And then we have Deutsche’s Banks gross notional derivatives exposure (Euro 55.6 TRILLLION) dwarfing German GDP (Euro 2.7 Trillion). By a factor of greater than 20! Now, THAT’S a lot of derivatives exposure.

On the bond front (the NEW eastern front), we see the US Treasury 2-year yield rising 17.1 basis points. But European sovereign yields are up double digits as well (except for Italy).