Today I Want to explain how the AMC and GameStop swaps destroyed Credit Suisse I Want to explain how they solidified The Squeeze Theory and how most banks are technically insolvent as a result. So stay tuned and let's make some money. And now when I dive straight in with the key information. So I want to explain when Credit Suisse originally retained ownership of these swaps when the swaps were originally taken out, and what Credit Suisse decided to do as a result to try and negate their losses and how this effectively led to the implosion of Credit Suisse.

So we know that Arcados collapsed on the 26th of March 2021. That means Credit Suisse took on ownership of these AMC and GameStop swaps around this date here indicated by the second big green arrow. Now we know that Arcagos lightly took out these swaps back in mid to late 2020 aka before the first AMC and GameStop run up. That means when Credit Suisse took on ownership of these swaps, they went down significantly.

The unrealized losses must have been at least 5, 10, or 10, 20 billion, maybe even more. The unrealized losses were clearly enough to bring down Arcados, but not enough to bring down Credit Suisse on their own. That means that credit Suite had unrealized losses from around four dollars per share pre-run up to around 50 per share when Credit Suisse took ownership. Now we know that in June we had the second run-up of AMC at GameStop Now Credit Suite.

at this point were absolutely convinced this was going to be the squeeze and therefore to negate their earlier put option or put swap losses. they decided to sell put swaps and put options. basically saying Credit Suisse originally held these put options or put swaps back from late 2020 expecting the price to go down and GameStop to go bankrupt. Obviously GameStop didn't go down nor go bankrupt and therefore Credit Suisse took on significant losses of the arcados, put options and put swaps went against them and then in June Credit Suisse thought the second run-up was absolutely gonna be the squeeze and therefore when some hedge funds thought the price was going to come down, they wanted to buy per options credit Suite on the other hand, thought the price would be going up, so they decided to sell those puts or sell more put swaps so they could benefit from the premiums and effectively negate their losses from the earlier swaps they inherited.

So that means that on the second run up instead of buying puts because that would mean they expected the price to go down, they decided to sell puts thinking the price was going to go up so they could collect those premiums and negate their earlier swap losses. I Think this clip from The Big Short explains a little better exactly what happened and exactly Credit Suisse's thought process. Come on, we know we travel. What's going on? How how bad is this? Okay, two years ago Benny Klieger in Morgan's Bond Department also started shorting some prime housing two billion in triple B's Benny is smarter than I Thought: no, he's not smart at all.

The premiums on the swap ate into his desk's profit to cover his shorts. He sold a lot of A and Double A swaps as protection a He believed that there was no way that they could be affected. Tell me: Morgan Stanley doesn't hold the contracts on these swaps all this time. I've been trying to figure out who I'm betting against and it's Morgan Stanley Which is me.

What's your exposure? Three billion. Please don't tell me it's more than four. I Can't answer that I can't answer. Yes, You can answer that because I Walk in here and people are crying in your hallway.

Kathy You bring me in to tell me everything's fine and everything's not fine. What? What is happening? A long exposure is 15 billion. So basically Credit Suisse sold these put options on the second runner to cover their losses that they inherited from Arcados. Expecting The Squeeze To happen so they'd rake in billions of dollars from the premiums, effectively negating all losses from those puts, and they could close out of the puts during the squeeze and make billions in profits.

But obviously the second run-up didn't cause the squeeze in either AMC or GameStop and instead the price has fallen ever since winding that spring. Titan Tighter And therefore, while credit Suite started to profit on their original put options that they inherited from Arcados because they sold maybe 10 times the amount in new put swaps, they were taking on significant losses as the price went down and didn't go up. And obviously Credit Suisse must have been using leverage and could no longer continue holding these puts that they had sold and could no longer continue rolling the contracts until the point a few weeks ago, where Credit Suisse obviously took on such significant losses that the bank ended up collapsing now. I Imagine a Credit Suisse isn't the only bank or the only institution that sold these put options or put swaps.

Obviously, many hedge funds are shorting AMC by taking out these put options and put swaps, so someone must be on the other end of the trade writing those contracts. Also, guys, be sure to sign up on me with a sponsor of today's video. using the link in the description below, you can currently receive up to 15 free stocks entirely commission free trading Free level 2 Market data and most importantly of all, MooMoo is very easy to use. They've got tons of technical indicators and advanced chart tools, and you've also got free 24 7 customer support, and you can also trade around the clock with Moomoo's full extended trading hours.

Obviously, we know that Credit Suisse did indeed hold these swaps or these put contracts because it appeared in Bloomberg some time ago and obviously the Arcados swaps renewal date was on the 29th of March 2021 for two years and therefore came up for renewal on the 29th of March 2022 only a few days ago. And therefore, as these positions haven't yet been closed out of another institution has obviously taken on this step and taken on this burden from credit. Suite It's likely UBS One Bank that may also be involved is Barclays. As G-Man tweeted, he said Breaking News: Barclays Bank makes a 200 million dollar payment in the form of a fine for selling unprecedented 17.7 billion dollars in Securities in excess of their 2021 reports.

Now if that confuses you, you may remember the Barclays on January 28th sold 17.7 billion dollars worth of Securities in excess of what it had registered with the commission. Basically saying that Barclays sold 17.7 billion dollars in synthetic shares and obviously only received a 200 million dollar fine. While that 200 million dollar fine is a small price to pay, these put options and put swaps sold by Barclays are likely still out there as well, and therefore potentially Barclays could end up being the next bank that ends up collapsing as a result of the AMC and GameStop swaps, and MarketWatch has written this article saying that most U.S banks are technically near insolvency and hundreds are are already fully insolvent. It says consequences for the banks have been severe by the end of 2022.

U.S Banks unrealized losses on Securities had reached 620 billion dollars about 28 of their total Equity capital. And making matters worse, higher interest rates have reduced the market value of banks other assets as well. Accounting for this implies that U.S Banks unrealized losses actually amount to 1.75 trillion dollars or 80 of their Capital. Therefore, judging by the quality of this Capital most U.S banks are technically near insolvency and hundreds are already fully insolvent.

Obviously, if more depositors flee, the deposit, franchise evaporates and the unrealized losses on Securities become realized as Banks sell those Securities at the current value to meet withdrawal demands. So for example, we know that Barclays currently has tons of unrealized losses on all of these: Securities they sold in excess of what they registered with with the commission, and if Barclays has too many withdrawal requests, they have to close out of those Securities to meet withdrawals and effectively likely go bankrupt. And marketwatches said now, this House of Cards is collapsing. The credit crunch caused by today's banking stress will create a harder Landing for the US economy now.

I Also wanted to give a quick update on Mmtlp because Mark Alex submitted a recent Freedom of Information Act request that was actually successful. As a result, he was provided emails from Finra that was sent directly to the SEC About Mmtlp Sam from Finra said it looks like this Mmat Mmtlp Mata has now hit my fraud teams radar screen and seemingly a lot of other radar screens as well and he said I know you at the SEC have spoken to Patty and our General Counselor's office, but I was wondering if it made sense for me and my fraud team to have a conversation direct with you and your folks working on the matter so we're not duplicating efforts. He said we're looking at the two issuers from a fraud or manipu angle and in fact blue sheeting both Mmat and Mmtlp. As we speak so clearly, the SEC and Finra out were aware of exactly what was going on with Mmtlp and decided to Blue sheet the stocks.

Regardless, they knew there was fraud and manipulation going on with Mmtlp and Mmat and instead of allowing that fraud to actually happen and the squeeze to happen as a result, they just blue sheeted the stocks and halted trading. I Think Really, this is just more unprecedented corruption between Finra and the SEC that I hope comes to light more and more as more Freedom of Information Act requests are submitted, but guys, be sure to let me know what you think down in the comments below. and as always, guys, be sure to ding that notification Bell because that way you'll be alerted when upload a new video. Cheers.