Jim Rogers is a pretty big deal in the financial world. Rogers is the legendary investor who co-founded the Quantum Funds. The Quantum Funds are privately owned hedge funds which are advised by George Soros. Soros started the fund in 1973 in partnership with Jim Rogers. Rogers is an author of several best-selling books and is a highly sought after worldwide financial commentator. So when Jim Rogers gives his opinion on a subject as important as the Deutsche Bank fine and a possible bankruptcy of the German banking giant; you better believe people listen!
Rogers recently told RT News that the U.S. government is desperate for money and will try to get it anywhere they can, including issuing staggering fines against banks. Rogers says he can’t imagine that Deutsche Bank should be liable for the entire $14 billion levied against it by the U.S. Justice Department for its role in the mortgage securities scheme in the run-up to the 2008 financial crisis.
Deutsche Bank has said it won’t pay anything near to what the U.S. has asked for, and a much talked about settlement between the two sides for a about $5 billion has not happened. So how will this be settled? Well, according to Jim Rodgers there’s one of two ways:
• Either Deutsche Bank goes bankrupt, (which is going bring down the entire world financial system)
• Or they are going to come up to some kind of compromise at a lower number. If Deutsche Bank does have to pay $14 billion – you should be very worried anyway, but especially if they have to pay $14 billion.
• If you look at its balance sheet you will see it has huge, staggering debts both on balance sheet and off balance sheet, which means their debts that they don’t reveal directly. It probably will survive if it has support, but otherwise we all are going to have huge problem in the next couple of years. We all should be very worried. The world is going to have a lot of problems the next couple of years.
• Politicians and bureaucrats have all the power – they take it and they run with it. Power corrupts, it has been happening for hundreds of years.
And what happens if Deutsche Bank fails? What would that mean for the European Union and the financial world in general? Jim Rogers says:
• The E.U. would disintegrate, because Germany would no longer be able to support it, would not want to support it. A lot of other people would start bailing out; many banks in Europe have problems. And if Deutsche Bank has to fail – that is the end of it.
• In 1931, when one of the largest banks in Europe failed, it led to the Great Depression and eventually the WWII. Be worried!
Germany has been telling everybody not to bail out their banks, but if they have to suddenly bail out their banks, then other countries will be furious and the politicians will have a field day.
Listen to more of Jim Rogers below.
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