Quote from: monsta666 on Feb 08, 2024, 01:22 PMDeutschebank are a strategically important bank in the EU. They are too big to fail and will be bailed out if it comes to that. The only thing that makes this harder is the Germans are not in direct control of the EU central bank so any bailout will be more convoluted.
Convoluted is a major understatement. The Dollar has a 1:1 correspondence with USTs. The Euro on the other hand is backed by the bonds of all the countries that use it, not just Germany. I can't see France for instance selling bonds to prop up a German bank. So Germany has to sell all the bonds, but the German economy and Tax base isn't as big as the FSoA. You need the whole European Union to have that much economic power.
Even if they do manage enough bond sales to cover the losses, the Euro will crater against the dollar by at least 20%, probably more. Energy and Food, anything priced in dollars will go through the roof.
There is no exit here. If they can keep this one together, they really are the smartest guys in the room.
RE