Lots of people write negative comments; however, in my opinion it is one of the best and straight-to-the-point videos about Basel III I've seen so far. Thank you!
You shouldn't rate your own videos. In this video I am going to relate the A B Cs of banking; however, first I'll take you through the histories of the ancient Sumerian Alphabet. No. Bad narrator. 1) Define the rule. 2) Tell the audience how it affects banking. 3) Tell the audience how it affects them. Now, show the illustrations and caveats.
You sound informed, maybe you could answer this: 4:59 How, during the stress test, with only 50% load payback is that same bank responsible for injecting the economy with "the other 50%". Where does this come from? And, how does this decrease that bank's risk? Too me that seems to double the risk of that bank, though it is intended to stimulate a lagging "external" economy. What would happen in recession? Those banks are going to be in trouble. That seems like a way to break smaller banks.
@@rebussleuth496 It's called Fractional Reserve Banking. When you deposit money into your bank account, the bank takes that money and 10x it (out of nothing) and then lends it out - ie: you deposit $2000, the bank can then lend out $20000 (that's not a typo). The 'stress test' per se, is on the whole $20k and not the $2k. So in this specific case above, they owe you $2k, and have 'injected' $18k into the economy through loans. This is evil and demonic. Why? Because they did not work for the $18k, they simply lent it and the borrower now has to work to pay interest on the loan. Banks literally create money out of nothing and lend it at interest to you, me, businesses, mortages etc. Think of this as a national level where the countries are forced to 'borrow' money from the central bank. Again, the central bank creates money out of nothing and can create and reduce as much as they want and lend it to governments at an interest rate - the governments then need to tax its citizens to pay back the central banks. To answer your question about smaller banks - the answer is: yes. The bigger banks will eat up the smaller banks when they begin to default. It is an evil system, because a small number of people control the amount of money is being created ie: $18k above, and thus control what they want. In the old days, it used to be based on Gold, because gold is limited - you can't create gold out of nothing, you need to mine it, refine it and store it. Bitcoin is popular because there is 21million bitcoins only, you can't create more bitcoins on a whim. Let me know if you got anymore questions dude
@@benyameenyitzhak1036 I am not presuming they are predatory and evil. But you have a system that needs to stimulate smaller economic entities, to in turn enhance the motivation to work and have a decent life. Of course in the natural world, the answer to starvation of some is to take from the plenty around them, in human society that plenty certainly does seem to be in the pockets of so few. Of course I am aware of fractional reserve banking. And the problems within it. But it is still important to follow their strategies and see where the error in logic is made, otherwise you are throwing stones at the castle walls. If you get smart and get into the details, maybe there are ways to tap into some better way of stable economic in roads. And, of course, digital currency, in as far as it is distributed across many many stake holders, is a better solution than the less widely distributed fiat currency holdings.
@@rebussleuth496 Fractional Reserve Banking is like a hot blonde with Aids. It's great at the start until reality sets in. The reason that crypto currency and gold are better is because it is limited. Any currency that can be created or destroyed is one that cannot live. No fiat currency has ever survived.
You can play at black jack tabel and you might win a hand but the house won't tell you how they always win in the end. A man that needs or wants nothing is useless to a central bank, thats why sosalisam is for fools. Money is a man getting out of bed and producing assets that can be taxed hedged wrobed or invested.
this is not Basel 3 in 10 minutes, this is taken from a BNP employee speech. If focuses on liquidity, saying hardly anything on capital, which is the most important part of Basel III
Banks don't lend reserves. Loans themselves don't empty the bucket, they grow the B/S. Only subsequent payment of loaned cash to a different bank lowers the level. If the payment would stay on the same bank's liabilities, no reserves (liquidity) need to escape.
I am not a banker; however, a banker friend of mine that left the business confided in me that my "conspiracy theories" involving banking were accurate and he commended me for my courage in speaking out. Although this piece did not mention gold specifically, it did reveal that the capital requirements for banks will be higher and we know from elsewhere, going forward, that gold will now be considered a "cash equivalent". We can anticipate that banks will be acquiring gold, which will be appreciating in value, over increasingly worthless fiat currency to meet their capital requirements. Also, the moves that are being made are more conservative (i.e bearish) and would seem to be being made in anticipation of a downturn. Certainly the higher capital requirements is removing liquidity from the system which is deflationary (i.e. tightening of the money supply).
I hate the corruption and theft of central banks as Thomas jefferson, but without fractanal lending there wouldn't be no indoor plumbing. There just needs to be asset backing on desintrilized competitive lending to be sustainable. Cartels monopoly allagarks and futilisem lords always get to greedy and ruin it for the rest of us pessents aspiring to rize above our station.
No thats a collection agency a branch of banking, banks creat debt, assets, liabilities, and profits all at the same time, then wait to see witch ones you make them into. The problem with banks is they are not transperant desintrilized with local asset backing and should invest more support to help lenders become profitable assets not liabilities.
Only, banks do not 'lend' anything. They are buyers and sellers of securities. There is also no legal definition of a 'deposit' in banking. Customers only 'lend' their currency, they do not 'deposit it. All sounds a little self governed...
If all your loans are to a crypto traders or comersal mall realistate in 2019 then your bank would go upside down svg style, and in the banking world that dosnt mean anything becase government can always bail you out but you might not make any money and get bad press, so well leveraged loans at low risk means end of year profits.
Someone into endogenous money explain this to me - if the 'banks create money from thin air' theory holds true, then how can that be if there are laws like Basel constraining lending?
There are laws on the books, but it does not mean they are followed, these so called laws are just lip service. There are patents and copyrights on "money" you would not believe possible.
They can loan an amount of money into existence out of thin air, but it is suppose to follow the capital and reserve ratios(may be more idk), so I believe the main concept believed by some "thin air people" is that the money created out of thin air is limited.
The big running jok at Goldman Sachs is "the idiots think they we give them money, but they are the money, now get back to work paying me intrest" to be fair they are doing you a favor by making you a productive asset when you walk out with a loan the question is will both of you profit from it?
Around 4min: Each time the bank grants a loan, some liquidity will leave the bucket. Why? Because the related cash will be with the corporate client, with the individual or with the person who sold a good to this individual. What is this supposed to mean? What is "related cash"? And why is that cash with the corporate client or ... or ?
I think , the bank lends the money to corporate and the corporate use that money for their activity including expansion, transaction to their customer, etc. So the money came down to corporate sector and flow to other sectors or individual that have bussines relationship with that corporate. Correct me if Iam wrong
Allen Lichner I think youre missing a chunk of info there bud. Need to catch up on some history. Fed is privately owned. Same with IMF and all central banks around the world for that matter
Lots of people write negative comments; however, in my opinion it is one of the best and straight-to-the-point videos about Basel III I've seen so far. Thank you!
You shouldn't rate your own videos. In this video I am going to relate the A B Cs of banking; however, first I'll take you through the histories of the ancient Sumerian Alphabet. No. Bad narrator. 1) Define the rule. 2) Tell the audience how it affects banking. 3) Tell the audience how it affects them. Now, show the illustrations and caveats.
Not if you understand how the banking system 'actually' works. No such thing as 'lending'...
1. Required capital change
2. Less balance sheet activities
3. Sufficient liquidity.
laoth limbu thank you for the cliff notes version
Try 1.25x speed :)
1.25? I had it at double lol.
You're a genius !
2x
Is there 3X or 5X?
Best comment for this video.
He left out one very important aspect of Basel III “The re clasification of Gold”
You sound informed, maybe you could answer this:
4:59 How, during the stress test, with only 50% load payback is that same bank responsible for injecting the economy with "the other 50%". Where does this come from? And, how does this decrease that bank's risk?
Too me that seems to double the risk of that bank, though it is intended to stimulate a lagging "external" economy.
What would happen in recession? Those banks are going to be in trouble. That seems like a way to break smaller banks.
@@rebussleuth496 It's called Fractional Reserve Banking. When you deposit money into your bank account, the bank takes that money and 10x it (out of nothing) and then lends it out - ie: you deposit $2000, the bank can then lend out $20000 (that's not a typo). The 'stress test' per se, is on the whole $20k and not the $2k. So in this specific case above, they owe you $2k, and have 'injected' $18k into the economy through loans.
This is evil and demonic. Why? Because they did not work for the $18k, they simply lent it and the borrower now has to work to pay interest on the loan. Banks literally create money out of nothing and lend it at interest to you, me, businesses, mortages etc. Think of this as a national level where the countries are forced to 'borrow' money from the central bank. Again, the central bank creates money out of nothing and can create and reduce as much as they want and lend it to governments at an interest rate - the governments then need to tax its citizens to pay back the central banks.
To answer your question about smaller banks - the answer is: yes. The bigger banks will eat up the smaller banks when they begin to default. It is an evil system, because a small number of people control the amount of money is being created ie: $18k above, and thus control what they want.
In the old days, it used to be based on Gold, because gold is limited - you can't create gold out of nothing, you need to mine it, refine it and store it. Bitcoin is popular because there is 21million bitcoins only, you can't create more bitcoins on a whim.
Let me know if you got anymore questions dude
@@benyameenyitzhak1036 I am not presuming they are predatory and evil. But you have a system that needs to stimulate smaller economic entities, to in turn enhance the motivation to work and have a decent life.
Of course in the natural world, the answer to starvation of some is to take from the plenty around them, in human society that plenty certainly does seem to be in the pockets of so few.
Of course I am aware of fractional reserve banking. And the problems within it. But it is still important to follow their strategies and see where the error in logic is made, otherwise you are throwing stones at the castle walls.
If you get smart and get into the details, maybe there are ways to tap into some better way of stable economic in roads.
And, of course, digital currency, in as far as it is distributed across many many stake holders, is a better solution than the less widely distributed fiat currency holdings.
@@rebussleuth496 Fractional Reserve Banking is like a hot blonde with Aids. It's great at the start until reality sets in. The reason that crypto currency and gold are better is because it is limited. Any currency that can be created or destroyed is one that cannot live. No fiat currency has ever survived.
@@benyameenyitzhak1036 what do you happens June 28th?
Very simple explanation and to the point. Thank you team!
I came to fill my bucket of knowledge, but I see there are restrictions on the liquidity of that knowledge.
yeah don't try to write a clever comment because it didnt work lol
LEHHHQUIDIHTIEEE
You can play at black jack tabel and you might win a hand but the house won't tell you how they always win in the end.
A man that needs or wants nothing is useless to a central bank, thats why sosalisam is for fools. Money is a man getting out of bed and producing assets that can be taxed hedged wrobed or invested.
😂
Yeah it is good to regulate banks, sounds a bit late in the game. What happens if all the banks are already insolvent. .
In such case you are referring to a 2008 scenario of credit crisis. Systemic risk prevails & the banker of the last resort will need to step in.
@@vikramdeshmukh6373 and destroy the dollar
Central banks are insolvent, they are BANKRUPT
Hold on to your butts
controlled demolition.
this is not Basel 3 in 10 minutes, this is taken from a BNP employee speech. If focuses on liquidity, saying hardly anything on capital, which is the most important part of Basel III
Hi.thank you for making this video.it really shed some light how risk management works.
"oh, our relationship is 'operational'"
understood everything very clearly...thnku for such fully conceptual clearance
Banks don't lend reserves. Loans themselves don't empty the bucket, they grow the B/S. Only subsequent payment of loaned cash to a different bank lowers the level. If the payment would stay on the same bank's liabilities, no reserves (liquidity) need to escape.
Straight to the point and very incisive !
The moral of the story, hold more gold
It is vice versa: Bank credit creates bank deposits. There is no intermediation. Capital requirement constrains bank's credit stock.
I am not a banker; however, a banker friend of mine that left the business confided in me that my "conspiracy theories" involving banking were accurate and he commended me for my courage in speaking out. Although this piece did not mention gold specifically, it did reveal that the capital requirements for banks will be higher and we know from elsewhere, going forward, that gold will now be considered a "cash equivalent". We can anticipate that banks will be acquiring gold, which will be appreciating in value, over increasingly worthless fiat currency to meet their capital requirements. Also, the moves that are being made are more conservative (i.e bearish) and would seem to be being made in anticipation of a downturn. Certainly the higher capital requirements is removing liquidity from the system which is deflationary (i.e. tightening of the money supply).
I hate the corruption and theft of central banks as Thomas jefferson, but without fractanal lending there wouldn't be no indoor plumbing. There just needs to be asset backing on desintrilized competitive lending to be sustainable. Cartels monopoly allagarks and futilisem lords always get to greedy and ruin it for the rest of us pessents aspiring to rize above our station.
this was so clear!! thank you!
excellent summary of Basel III..
Excellent explanation
Some small banks will be wipe out, when Basel all takes place .
just like the S&L that took out thousands of state banks. squeeze them out and take their assets
This video is for experts who know what operational relationship, what cross selling and what factoring mean.
Mario Luoni if they were experts the banking system wouldnt be bankrupt.
@@thethinkingman9338 We're probably not talking about the same experts ;)
@@sakuranooka , are you talking about the "experts" who are from "out of town" as per Mark Twain?
@@ccahill2322 Hmmm... maybe I'm talking about those coming from a parallel universe ;-)
@@sakuranooka , if you believe that Buffalo, New York or Hartford, Connecticut are in a parallel universe you may very well be right.
Happy Basel 3 day
Thanks for making it very visual
good one
This is wrong. banks dont loan out reserves to customers. Banks only loan reserves to other banks or investment institutions.
Bail in..................= retaining liquidity
Great video! Keep up!
Hi may i know what does RUN-OFF means?
Wrong. You’re wrong. A bank is not a financial intermediary. Commercial banks are in the business of purchasing debt instruments.
No thats a collection agency a branch of banking, banks creat debt, assets, liabilities, and profits all at the same time, then wait to see witch ones you make them into. The problem with banks is they are not transperant desintrilized with local asset backing and should invest more support to help lenders become profitable assets not liabilities.
Very cool, Kanye.
Nicely explain
Really Simplified...Banks have to follow the same.
Sir, if the ratio of Tier 1 capital is equals to Minimum Total Capital Ratio, in that case should a bank maintains Tier 2 Capital?
Only, banks do not 'lend' anything. They are buyers and sellers of securities. There is also no legal definition of a 'deposit' in banking. Customers only 'lend' their currency, they do not 'deposit it. All sounds a little self governed...
thanks for the video
3% leverage ratio means that 97% of a banks balance sheet can be money newly created by that bank, correct?
Only if the government bailout can cover the 97% loss in the end. Pluse some xmas bonuses to jp Morgan and goldman.
good video!
Thanks a lot for making this so simple...
Wonderful
Mandelo en español
They didn’t talk about the metals market in this.
is Basel 3 some standard for banks?
Yes but it’s entirely voluntary.
BCBS, do not have amy legal powers.
Explain camels in banking
2:01 Help me understand the significance of limiting the banks balance sheet.
If all your loans are to a crypto traders or comersal mall realistate in 2019 then your bank would go upside down svg style, and in the banking world that dosnt mean anything becase government can always bail you out but you might not make any money and get bad press, so well leveraged loans at low risk means end of year profits.
ليته كان مترجم ملخص رائع
Thank you! This was very helpful :)
Where does the capital come from?
any day now...
Thank you
Good but misses the net stable funding metric under Basel 3
Net means profit over break even point on ongoing loans rite?
Formulation seem very arbitrary. Surprised that this is system that banking leaders devised.
Not even a mention of gold. What a load of PR crap
What part of OVERVIEW aren't you getting exactly?
Someone into endogenous money explain this to me - if the 'banks create money from thin air' theory holds true, then how can that be if there are laws like Basel constraining lending?
There are laws on the books, but it does not mean they are followed, these so called laws are just lip service. There are patents and copyrights on "money" you would not believe possible.
They can loan an amount of money into existence out of thin air, but it is suppose to follow the capital and reserve ratios(may be more idk), so I believe the main concept believed by some "thin air people" is that the money created out of thin air is limited.
The big running jok at Goldman Sachs is "the idiots think they we give them money, but they are the money, now get back to work paying me intrest" to be fair they are doing you a favor by making you a productive asset when you walk out with a loan the question is will both of you profit from it?
👍
Impressed with the editing omh
Insted of making ppts we can make videos and speak😆
great
thank you ..
Is this the same voice for kurzgesagt??
Basel brush requirment is far better when accumulating fools gold!
Around 4min:
Each time the bank grants a loan, some liquidity will leave the bucket.
Why?
Because the related cash will be with the corporate client, with the individual or with the person who sold a good to this individual.
What is this supposed to mean? What is "related cash"? And why is that cash with the corporate client or ... or ?
I think , the bank lends the money to corporate and the corporate use that money for their activity including expansion, transaction to their customer, etc. So the money came down to corporate sector and flow to other sectors or individual that have bussines relationship with that corporate. Correct me if Iam wrong
WTF is operational intimacy??
Great
When did BASEL III start?
we need to nationalized the federal reserve
Allen Lichner I think youre missing a chunk of info there bud. Need to catch up on some history. Fed is privately owned. Same with IMF and all central banks around the world for that matter
Xrp
Educate me please!.
Getting even confused after watching this video. I doubt the presenter understand BASEL III properly.
No mention of gold. Pointless video.
bullshite, he said about banks NOT telling once two words "Gold, Silver" ( thru money with >5000 years history). Dogshite
Moral of the story, hold more bitcoin ;)
In spanish, please !!
Very lame!!
Betalon Jack in
Thank you