Jim Sinclair’s Commentary
World shaking changes in the Middle East. Peak oil production. Inevitable hyperinflation. All attention on Japan as markets forget the growing foundation of international dislocation.
Stay focused. Stay discipline.
Jim Sinclair’s Commentary
Derivatives cannot stand the light of day in civil litigation.
Deutsche Bank loses suit over investor losses
(AP:FRANKFURT, Germany) A German court has ruled that Deutsche Bank didn’t sufficiently disclose the risks when selling one of its financial products to an investor.
The Federal Court of Justice said Tuesday that Germany’s biggest bank must pay the company, Ille Papier-Service GmbH, some euro541,000 ($767,000) plus interest in recompense.
The ruling could influence the outcome of other disputes between Deutsche Bank and small companies and local governments, that also entered into so-called interest-rate swap deals. The intention was to lower their interest payments, but many lost money.
In its ruling, the court agreed with Ille, which had lost twice in lower courts, that Deutsche Bank had not sufficiently disclosed the risks of the complicated transaction, dubbed a CMS spread ladder.
It also said a bank, acting as adviser, had to ask customers about the level of risk they were ready to take on, and could not assume the level of risk was appropriate simply from being acquainted with the customer beforehand.
