Run on Banks Begins Deutsche Bank Clients Begin Withdrawing Excess CashBy Matt Agorist While the vast majority of the banks more than 200 derivatives-clearing clients have made no changes, the hedge funds run on cash highlights serious concern. The paranoia of an imminent collapse spread to the US on Thursday as 10hedge funds that are Deutsche Bank clients have decided to withdraw cash and listed derivatives positions from the bank, according to a Bloomberg News report. Millennium Partners, Capula Investment Management and Rokos Capital Management are among about 10 hedge funds that have cut their exposure, said a person familiar with the situation who declined to be identified talking about confidential client matters. The hedge funds use Deutsche Bank to clear their listed derivatives transactions because they are not members of clearinghouses. Millennium, Capula and Rokos declined to comment when contacted by phone or e-mail. These funds use Deutsche Banks prime brokerage to clear their derivatives trades, reports Bloomberg. They post collateral as a sort of insurance in case they run into trouble but now they appear to worry that Deutsche Bank is the one in trouble. So they are withdrawingsome of their derivatives holdings and excess collateral above what Deutsche Bank requires them to hold. As Zero Hedge points out, this massive withdrawal of cash has led to a sharp increase in short-term CDS. Our trading clients are amongst the worlds most sophisticated investors, Michael Golden, a spokesman for Deutsche Bank, said in an e-mailed statement. We are confident that the vast majority of them have a full understanding of our stable financial position, the current macroeconomic environment, the litigation process in the U.S. and the progress we are making with our strategy. But this is simply not true. Deutsche Bank is anything but stable as their shares have fallen sharply on the news that German Chancellor Angela Merkel wont bail them out. Its shares fell by as much as six percent in early Monday trading, making it the worst performance since 1992. Since January, the banks shares have lost over 52 percent of their value. As news of the bank run spread on Thursday, the stable banks shares declined below 10 euros for the first time.The lenders 1.75 billion euros ($2 billion) of 6 percent additional Tier 1 bonds, the first notes to take losses in a crisis, fell as much as five cents on the euro to 69 cents, a record low, according to data compiled by Bloomberg. The issue here is now one of confidence, said Chris Wheeler, a financial analyst with Atlantic Equities LLP in London. Thats whats going on here. The thinking is Deutsche Bank is fine, but theres a slim chance it might not be, so why leave my money in there? The possibility of depositors having their funds taken from them as the bank collapses is not at all isolated as it has happened before. As we pointed out, to keep the bank solvent, the Bank of Cyprus took almost 40% of depositors funds leaving customers with essentially nothing they could do about having their money stolen. Assets were frozen and ATM machines were not refilled. As Jay Syrmopoulos points out, the collapse of Deutsche Bank would most likely begin a cascade of Western banking institutions falling like dominoes (which could include Barclays in London and CitiGroup in the U.S.). According to same expert who valued Lehmans worth at its collapse, Deutsche Banks current value of $1 trillion dollars is significantly more than Lehman Brothers valuation during their collapse in 2008. The graphic below shows the severity of the impact and implications for contagion a DeutscheBank implosion would have. In fact, the contagion has already begun.News that some hedge funds were pulling positions and excess collateral from Deutsche Bank caused shares of U.S. banks to quickly reverse early gains, according to Bloomberg. But dont worry, just as Lehman Brothers maintained in the beginning of 2008 that everything was fine and dandy, Deutsche Bank is doing the same. In a memo to staff published on Friday, as reported by Bloomberg, Deutsche Bank Chief Executive Officer John Cryan responded to what he called media speculation causing some unjustified concerns, saying that the banks balance sheet has never been more stable over the past two decades. Ongoing rumors are causing significant swings in our stock price, he wrote. Its our task now to prevent distorted perception from further interrupting our daily business. Trust is the foundation of banking. Some forces in the markets are currently trying to damage this trust. However, even the IMF has called their bluff, noting thatDeutsche Bank appears to be the most important net contributor to systemic risks. Matt Agorist is the co-founder of TheFreeThoughtProject.com, where this article first appeared. He is an honorably discharged veteran of the USMC and former intelligence operator directly tasked by the NSA. This prior experience gives him unique insight into the world of government corruption and the American police state. Agorist has been an independent journalist for over a decade and has been featured on mainstream networks around the world. Follow @MattAgorist. and now on Steemit Looks like it is time for the Bail Outs to begin again- just like in Greece, Spain, Portugal, Italy, Ireland, etc. Articles like this were flooding out right before those bails outs too. If a scam keeps on working and pays you big bucks why not? If our gambling pays off we get super rich, if it doesnt we use it as an excuse to force the debt on the public which is even better!! After all, in that case OUR debts become YOUR debts and you owe us big time. Now YOU have to destroy yourselves financially to pay US back! Plus we lecture you from our fake moral high horse! Who can beat that? We still get paid as if out bets had worked plus we get to pillage your economy! How can you beat that? We still get super rich AND we get control of your economy!! In other words, the MORE we lose the MORE we WIN in reality! Very perspicacious spot onWelcome to the Millennial Merry-go-Round/ Babylonian Majik $$$ Show. Stop supporting these satanic scum banks. Dear Naysayers, So? They just print more paper. Poof. solvent in 5 minutes. Never sure how the CEOs scam their paychecks all the whilst they are driving the bank to ruin. I am deplorable she is despicable. 