Happy Halving! Meanwhile, in the rest of the world, "Deutsche Bank is Coming Unglued"
DB Debacle
While everyone is celebrating the halving, be mindful that it is not the halving, or supply side of bitcoin which has the potential to cause a huge run up. The supply side in known, it is the unknowable demand side which we should be paying attention to, and Europe may be entering a very nasty period in banking...
The crashing shares and CoCos have a gloomy importance. Deutsche Bank will need to raise more capital to rebuild its buffer, fund more bad-loan losses, and pay more legal settlements for wrongdoing that keeps oozing from the woodwork. To raise capital, it will need to sell more shares and CoCos. With both crashing, it's going to be tough. It'll dilute existing shareholders, who are going to dump these shares in anticipation, which will sink them ... And issuing 6% CoCos when their brethren trade at 75 cents on the euro, or below, is going to be very expensive or perhaps impossible.
Italy is in the middle of a white-hot banking crisis. Risk of contagion in Italy and far beyond is huge.
(Article by Wolf Richter, Wolf Street, BI )
The contagion will roll in like a Tsunami ...
It's gotta get a lot worse, before it gets better
http://www.zerohedge.com/news/2016-07-09/deutsche-bank-gives-we-cant-think-time-sp-was-more-disjointed-everything
http://www.zerohedge.com/news/2016-06-29/imf-deutsche-bank-poses-greatest-risk-global-financial-system
http://www.zerohedge.com/news/2016-07-06/furious-italian-prime-minister-slams-deutsche-bank-europes-most-insolvent-bank
Whether it's this or something else, eventually a turn down is coming of magnitude. During the Great Recession, there was no bitcoin option. The question is, how much, if any, (given the relatively small trade volume and market cap) does bitcoin absorb capital as it takes flight from legacy financial markets? Certainly, China's capital flight has had a positive impact on bitcoin, and is a cause of the recent run up, but has it had the kind of Trillion $+ run up that everyone was talking about? I think not, or at least not yet. Also, nice to see another ZHer on here!