Latest posts

A Market Lesson on Leverage

Long a favorite tool by the investment community to juice up returns, financial leverage works both ways. The consequence of a leveraged bet gone wrong can be existential, as the latest lesson on currency trading demonstrates once again.

January 18, 2015
Currency, Finance & Economy

Bail-in At Your Local Bank – Part 4: Your Last Chance To Act

G20 governments are quietly slipping bail-in provisions into law to make sure that next time a too big to fail bank blows up again by derivatives it will be rescued using depositors’ money, in the name of protecting the taxpayers.

January 6, 2015
In-depth topic: Bank bail-in
Finance & Economy

Bail-in At Your Local Bank – Part 3: Institutionalizing the Money Grab

Herded along by the Financial Stability Board, governments of leading economies endorsed a framework during the past G20 Summit whereby depositors’ money will be used to rescue a failing bank when the global derivatives casino blows up again next time.

January 5, 2015
In-depth topic: Bank bail-in
Finance & Economy

Bail-in At Your Local Bank – Part 2: The Derivatives Time Bomb

The derivatives market, the trigger of the 2008 global financial crisis, has since gotten even bigger and more concentrated into fewer hands. A mutually assured destruction awaits the global economy next time it goes off again.

January 4, 2015
In-depth topic: Bank bail-in
Finance & Economy

A Primer on Derivatives

Financial derivatives are financial contracts in which the promised payoffs are derived from the performance of another underlying entity. The underlying entity can be an equity (such as an individual stock or a stock index), interest rate, credit or c …

January 3, 2015
In-depth topic: Bank bail-in
Finance & Economy, Primers

Bail-in At Your Local Bank – Part 1: The Stage Is Set

With no fanfare and little to no media coverage, your government has just put in place a mechanism to use your deposit money to bail-in a failing bank, like what happened in Cyprus a short time ago.

January 3, 2015
In-depth topic: Bank bail-in
Finance & Economy

Germany’s Energy Transition – A Progress Report

A progress report on Germany’s efforts to transition from fossil and nuclear fuels shows impressive gains in solar and wind energy. At the same time, the road to a completely fossil fuels free power grid remains daunting.

December 30, 2014
In-depth topic: Renewable energy
Energy

Municipal New Subdivsion Project Financial Analysis – A Case Study

A real life example is used to illustrate how the discipline of a business case analysis can and should be applied to determine the implications of a new development project to the finance of a municipality.

December 16, 2014
In-depth topic: Urban planning
Urban development

Tight Oil’s First Domino

The tight oil revolution is brought on by cheap debt and leverage. Should it unravel one day, then it would not be surprising that the first domino to fall will likely be from the capital markets.

December 13, 2014
In-depth topic: Tight oil Shale gas
Energy

A Nightmare Price Scenario for Tight Oil

In a what-if analysis, Deutsche Bank calculates the price threshold of oil below which would not only cause catastrophic events in the high yield bond market where tight oil companies raise their capital, but also send a shock wave across the entire high yield bond segment.

November 27, 2014
In-depth topic: Tight oil Shale gas
Energy