gold, page-840

Hi there wombat53

"What am I missing?"

Let's be under no illusion that European banks are doing it tough. But what is not clearly understood that some of their toughest problems are regulatory (heaped on them by the governments):

- European quantitative easing is more of a penalty to the banks than help. QE increases the level of reserve deposits the ECB hold from European banks. These have a negative interest rate, which is an effective tax on the banks. (If I had some spare time I would calculate exactly how much this costs the banks - possibly has high at €10 billion per annum across the European banking system.)

- European banks (and banks everywhere) are being forced to increase the capital adequacy ratios. DB was at 11.1% at the end of 2015 and has since increased them to 12.5%. Increased ratios make the banks safer, but it kills the capacity to grow, and they become much less profitable.

Is there a case for buying gold in here?

No really. Banks are safer with respect to default risk, but they are crap when it comes to investment returns. I am happy to deposit my money in a European bank (I bank with Banco Santander), but I wouldn't buy their shares.