Archive - Aug 23, 2012

Broke Eurogroup viceroy Jean-Claude Juncker meets broke Greek P(anhandling)M(aster) Antonis Samaras. Will a happy ending finally result? Stay tuned as Greece (and the Eurogroup) beg for Germany to finally stop saying "9".

• Australian minister says resources boom is over (Reuters)
• China dismisses reports of lost gold reserves (China Daily) - so China really did lose 80 tons of gold.
• Inconceivable: Former JPM CEO and Chairman William B Harrison Jr come out "In Defense Of Big Banks"
• Qantas Cancels 787 Order After Posting Annual Net Loss (Bloomberg)
• EU Official Says Crisis is Eroding Influence (WSJ)
• Greece Faces New Pressure on Cuts (WSJ)
• Philippines' black market is China's golden connection (Reuters)
• Hollande government responds to criticism (FT)
• LG Display Starts Touch Screens Output Before New IPhone (Bloomberg)
• Greek Crisis Evasion to Fore as Merkel Hosts Hollande in Berlin (Bloomberg)
• Stakes rise as US warned of double-dip (FT)
• Brazil’s Richest Woman Unmasked With $13 Billion Fortune (Bloomberg)

Just when we thought we had seen and heard it (and by it we mean lies, innuendo and desperation) all, here comes the one thing that confirms where the ECB, and Europe, is concerned, we ain't ever seen nuthin' yet. According to Bloomberg, the ECB may set secret ceilings on the yields of govt bonds from countries requiring bailout aid, Welt reports, without citing anyone. Note the words "secret" and "without citing anyone" because they really are key. Because it is unclear whether Bild is truly stupid enough to assume that what amounts to a limitless bond purchase operation could remain a secret and not show up on the ECB balance sheet. What it really is, is merely a last step desperation attempt by Mario to keep on talking down bond yields, since a month into his "believe me" speech, the ECB has yet to do anything, let alone secret or not so secret yield caps, let alone Spain demanding a bailout, let alone the ECB even reaching a consensus with Germany and Bundesbank both opposing any incremental money printing. Welt says that the ECB could also set a range for yields, merely another absolutely idiotic "detail" in the ECB's "secret" plan. Supposedly the advantage of a range is that the ECB wouldn’t need to defend a set price at any cost, could tolerate S/T deviations. The (lack of) logic for this measure is that central bankers no longer believe that announcing a ceiling and making it public would be enough to calm markets. But nothing, nothing, can prepare one for what comes next: Secret yield ceilings would only work if they aren’t leaked says Welt. Yup. They said that. This is where blood shoot be shooting out of your nose at escape velocity.