Greece Retaliation Against Germany Escalates: Airbrushed Venus Statue Flipping Off Greeks By Banana-Eating Germans Prompts Greek BoycottSubmitted by Tyler Durden on 02/26/2010 - 13:13
Have we just crossed the historic Rubicon when a photoshopped classical statue is about to lead to a collapse in a monetary and customs union, and possibly something a tad more serious? Also, is the KFW bailout rumor too little too late? It appears the Greeks are two minutes away from saying "take you bailout and shove it." The reason: The Focus cover which shows a status of Venus de Milo flipping off the Greeks, who were characterized as the "cheats of the eurozone." After recent Greek media outbursts have recalled the Nazi wartime occupation of the country, as well as demands for WWII reparations, today's action by the Federation of Greek Consumers, calling for a boycott of products, made by "banana-eating" Germans, is a direct response to the airbrushed statue of Venus expressing the communal German sentiment. Oh, and that whole KfW rumor? Don't buy it: "[KfW bond purchasing] considerations have been presented because it's seen as the only way of avoiding accusations of...direct aid," the lawmaker said. But he stressed that no decisions have yet been taken. I.e., More posturing.
- Bank of America Considers Request to Halt Foreclosures for HAMP
- FORECLOSURE HALT PERTAINS ONLY TO BANK-CONTROLLED LOANS
- BOFA'S DESOER CONSIDERS FORECLOSURE REQUEST, SPOKESMAN SAYS
- BOFA'S DESOER MET WITH HOUSING ADVOCATES SEEKING HAMP REVIEWS
- BOFA CONSIDERS REQUEST TO SUSPEND SOME HOME FORECLOSURES
Moody's, whose inability to downgrade Greece has made the late night credit trader comedy circuit, as a dump below A would be the formal start of the real-deal Greek funding crisis, has decided to project its downgrade insecurities on Europe punching bag Iceland instead: just what the brankrupt country needs. In a press release earlier the Moody's experts note "Moody's Investors Service said today that the breakdown in the talks between the governments of Iceland, the United Kingdom and Netherlands to resolve the Icesave dispute puts the Icelandic government's Baa3 rating under downward pressure." In the meantime, we are curious what the new index of Financial Conditions, created by such objective individuals as Goldman's Hatzius, DB's Hooper, ex-FRBNY's "Napoelon" Mishkin, NYU's Kermit Schoenholtz and Princeton's Mark Watson, says about availability of credit in Greece.
Germany is considering buying Greek bonds through state-owned lender KfW Group, German lawmakers said today. KfW is preparing measures that are part of a European plan to grant Greece as much as 25 billion euros ($34 billion) in aid should the need arise, said four lawmakers, who spoke on the condition of anonymity because the information is confidential....Assistance to Greece should flow through the International Monetary Fund, the most suitable body to offer financial help that’s tied to stringent conditions, the lawmaker said. The IMF should provide more than technical assistance, the lawmaker said, citing aid given to Hungary and Baltic states as examples.
Existing Home Sales Continue Dropping, Hit 5.05 Million In January, Miss Estimate By Nearly 10%, Down From 6.5 Million In NovemberSubmitted by Tyler Durden on 02/26/2010 - 11:27
January National Association of Realtors existing home sales came in at consensus busting (to the downside) SAAR of 5.05 million, a 7.2% drop from December's 5.44 million, which in turn was 16% lower than November 6.49 million. January consensus was for 5.5 million. Other data: the biggest deterioration was in the northeast (-10.9% sequentially), total houses sold (-11.1% seq), the months of supply (from 7 to 8), and the decline in both median and average price, coming in at -3.4% and -3.1%, respectively.
In Thursday’s Comments, we wrote that the napkins suggested support in the S&P lay at 1088/1092. The opening plunge took the S&P to a low of 1086 about 15 minutes into the session. That low lasted a nano-second and the index proceeded to churn at the 1088 level for much of the morning. In the same Comments, we said the napkins showed resistance at 1104/1108. The late session rally topped out at 1103.50. For today, we’ll stick with yesterday’s numbers. Support should be 1088/1092 with a critical back up of 1080/1083. Resistance looks like 1104/1108 with backup at 1113/1118. Today – We get GDP revisions and the Chicago PMI. Lots of interest will focus on the 9:55 release of the University of Michigan Confidence number. Will it confirm the steep plunge in Consumer Confidence? At 10:00, we’ll get standing home re-sales, followed by several Fed speakers over the day. - Art Cashin
In March 2008, I published a report titled “Capitalism Takes a Sabbatical.” If only that were the case. I really can’t believe what I just read on Bloomberg News (Obama May Prohibit Home Loan Foreclosures Without HAMP Review). In a nutshell, the White House is considering a tactic that would prevent banks from foreclosing on defaulted homeowners unless they have been screened and rejected by the government’s Home Affordable Modification Program (HAMP). George Orwell must be rolling over in his grave. - David Rosenberg
<-This is what Germany thinks of Greece (Focus)
About time someone starting looking at potential criminality here: How Goldman's Stephen Friedman gamed the financial system while at the New York Fed (Nation)
Inventories - the gift that keeps on giving - First GDP revision is higher (Bloomberg)
Lessons from the Fed's past on heading for an exit (FT)
Stevie Cohen trades secrecy for golf with investors lured by 30% returns (Bloomberg)
AIG posts loss on charges tied to rescue, may need more bailouts, shares fall (Bloomberg)
Hey Europe - You happy you complied with Summers/Bernanke and kept euro so high for a year? European economy risks decoupling from global growth recovery (Bloomberg)
As the roadshow was initially scheduled for the second half of February, this implies that the Greek bond offering is, for now, history. Furthermore, no new roadshow data has been set. It is unknown whether this is due to the massive deterioration in Greek financial perceptions over the past week, or if because the government has managed to arrange a private loan with Deutsche Bank (which hopefully does not have a downgrade put trigger as that would be the shortest loan in history).
Greek spreads were about 10 bps tighter earlier after rumors that Deutsche Bank CEO Ackermann's meeting with Greek officials was to set the tone for a €15 billion DB loan to Greece. Even as Eurostat was analyzing the Greek swap info, and Greece announced slightly better than expected January budget data, the country was still forced to delay its bond offering as expected by Zero Hedge, despite consistent disinformation rumors spread by the Greek ministry otherwise.
- Asia stocks, Emerging currencies, metals climb on Asia economic optimism.
- Bernanke says Fed is reviewing Goldman Sachs's arrangements with Greece.
- India's Finance Minister pledges to shrink budget gap as economic growth quickens.
- Obama may ban all foreclosures without review by loan-modification program.
- OPEC output reaches 14-month high in February on Saudi gain, survey shows.
- Sales of previously owned US homes probably rose on tax credit extension.
- Treasuries head for monthly gain on Greece debt concerns, Fed rate outlook.
- Yen declines versus Dollar, Euro amid speculation importers sold currency.
RANsquawk 26th February Morning Briefing - Stocks, Bonds, FX etc.
The New York Fed has released this week's Primary Dealer net holdings update. While the data indicates that PD's were aggressive sellers of virtually everything (USTs, Corps, Agency, except MBS) in the prior week, the one category that stood out was Treasury Bills, in which net short exposure reached levels last seen during the Lehman bankruptcy. Last week's net short exposure of ($15) billion compares to the ($26) billion two year low seen on September 17, 2008. The Lehman collapse period was very curious as during it PDs saw both a record selling in Bills followed by a record buying of Bills, all within a month: whereas in the week ended 9/17 $41 billion of Bills were sold/shorted, the week of October 22, saw a covering/buying spree of over $51 billion. We have not seen this kind of amplitude in the past two years. Over the past 5 weeks, PDs have sold a total of $29 billion in Bills, starting with a net long exposure of $13.8 billion in the week ended January 13, and culminating with a net short of ($15) billion on February 17.
When the S&P500 came upon the 3:15pm close, the market had settled negative, but hardly. The rally was good for 17.50 points from the low equating to a 1.6% reversal. And in case you didn’t know, a 1% market move equates to well over $100 billion in market capitalization. Therefore, this amazing move tacked on ~ $180,000,000,000.00 to the US (non-rigged) market cap. How nice. Oh, did I mention this was based on a RUMOR…an UNFOUNDED RUMOR? Not to worry though folks – you can bet your bottom dollar that the fellas on Fraud Street weren’t about to let a massive rally fade away to nothing. After the initial period when AAPL denied the rumor and the market churned around 1097.00, then the market went even higher. Said another way, Fraud Street kept the gains based on a known FALSE rumor…and then…wait for it….wait for it…I G N O R E D the real news of the morning. It was a well timed replay of the Greek bailout rumor of Feb. 9th. How healthy is this market if its best moves are 100% fabricated bull$#it? I have another question or two: Who benefited from this other than Goldman Sachs? I wonder how many magical S&P500 at-the-money calls were purchased moments before the explosion? I wonder if the SEC will investigate? Would the Lame Stream Media ignore this if a false rumor triggered a 1.6% rout? OK, I know the answer to the last two – and it’s no.
Federal Reserve Balance Sheet Update: Week Of February 25 - Just $45 Billion Left In Quantitative EasingSubmitted by Tyler Durden on 02/25/2010 - 21:38
The Federal Reserve's assets were at $2.27 trillion as of February 25, jumping by $6 billion sequentially. Securities held outright: $1,975 billion (an increase of $62.6 billion MoM, resulting from $59 billion increase in MBS and $3 billion in Agency Debt), or $8 billion increase sequentially. The fed has completed $169.1 billion of $175 billion in the agency MBS program, or a 97% completion, and 96% complete with purchases of Agencies. The Fed has completed $1.21 billion of its $1.25 billion MBS debt purchase program, or 97%, through February 25. There is just $45 billion left in QE. Net borrowings: $103 billion. The monetary base increased by $81 billion in the past fortnight to $2.14 trillion. The ratio of total assets to Monetary Base declined slightly to 1.06x. Float, liquidity swaps, Maiden Lane and other assets: $191 billion. The CPFF program was at $7.7 billion. FX liquidity swaps are now at zero: we are carefully keeping an eye on this metric as any increase presently would indicate banks are again experiencing a dollar funding shortage. Maiden Lane I and Maiden Lane II increased and were $27.2 and $15.5 billion, while Maiden Lane III as always continues pretending it has value and came flat at $22.4 billion.