Citi Issues USD Warning: "Significant Downside Risk For USD And JPY If Market Begins To Price In Unsustainable Debt Risk"

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Thu, 04/14/2011 - 17:52 | 1170515 Quintus
Quintus's picture

If the market does NOT begin to price in unsustainable debt risk, then the market is dumb.  Seriously, is the debt problem going to go away by itself, or will the Teleprompter-in-chief really deal with it?  Answers on a postcard please, to whatever address you like.

Thu, 04/14/2011 - 18:01 | 1170530 AN0NYM0US
AN0NYM0US's picture

Dear Vikram:

Have one of your people scare the markets to make sure the debt ceiling is raised.




Thu, 04/14/2011 - 19:20 | 1170760 OldTrooper
OldTrooper's picture

Bingo.  And there may be martial law, rioting, cats and dogs sleeping together - we're talking disasters of biblical proportions - unless you raise that debt ceiling.

Thu, 04/14/2011 - 20:32 | 1170922 narapoiddyslexia
narapoiddyslexia's picture

Exactly. Believe nothing any of these liars produce.

Thu, 04/14/2011 - 22:01 | 1171077 Ned Zeppelin
Ned Zeppelin's picture

Ditto. The debt ceiling will be raised.  All proceedings before that event will be the foreplay. 

Thu, 04/14/2011 - 22:27 | 1171167 66Sexy
66Sexy's picture

So I am supposed to lend credibility to a TBTF bankrupt bank?


Watch for a dollar RALLY.

Thu, 04/14/2011 - 18:39 | 1170659 Cdad
Cdad's picture

If the market does NOT begin to price in unsustainable debt risk, then the market is dumb.

The market for US dollars HAS priced in the risk.  It is every single OTHER market that has NOT priced in risk [less precious metals, of course].  And this is exactly the point.  Citi waited until TODAY to publicly announce that it perceives a risk to the dollar.  Really?  This is everything the criminal syndicate known as Wall Street has been doing...for decades.

So standby for a fear gap move on the be followed by a dollar rally that will likely crush every last OTHER asset class that you can possibly think of.  Throw on top of that the CME hiking margins, and Goldman suddenly concerned about copper and oil, and what you got is a typical bumble fuck during which the guy with the most natural counter intuitive tendencies wins.

Better yet, go to cash and wait.  And if you don't agree...well, just report to the nearest Google chart...and I think you'll have a epiphany.  In the words of Tyler Durden..."you are warned."

Fire hose please...a couple of them in front of each and every building anywhere near the corner of Wall Street and Broad.

Good grief [and by that I mean, I sure hope all those "special" fellows over at Citi receive my shipment of donated hockey helmets...'cause I think they really need them.]

Thu, 04/14/2011 - 19:47 | 1170823 SamuelMaverick
SamuelMaverick's picture

Sounds about right except for one thing, the rally in the dollar / commodity downturn will be short lived when reality reasserts itself. M1 and M2 are thru the roof, velocity is in the crapper, and the never ending flow of the Fed treasury / bank ponzi fiat that the US gov is spending is unrelenting.  The end of QE2 will hopefully give us a small window of time to buy PM's on the cheap. No joke, BTFD.












































Thu, 04/14/2011 - 19:50 | 1170841 Cdad
Cdad's picture

Sheesh Samuel...ease up on the martinis...and the space bar.  Also, what the Fed is bringing is ANYTHING BUT NEVER ENDING.  It is quite finite...but...

Agreed...any dip will be brief.  My will be violent.  So...going forward from today...the greatest part of the trade will come from not being long the fundamental story while the criminal syndicate known as Wall Street executes/murders/arbitrages existing long positions.  After all, that is the only value added the Street brings...creating the spread between the truth and perception.

I ask...did you read what I said?

Thu, 04/14/2011 - 22:48 | 1171228 SamuelMaverick
SamuelMaverick's picture

Yes , I did read what you wrote. You did not mention a timeframe for trading on the possibility of what will probably happen.  At the end of QE1 the devastation was spectacular. The window for taking advantage of it was only a couple of months. Probably will be the same for QE2. If I am right, I will be buying my silver back somewhere in the $30's, if I am wrong I will be buying it back at $50. Either way ,I will be buying come June and July. Also, no martini's, and no space bar. I have no idea what the hell happened with the empty space in the last post.

Fri, 04/15/2011 - 02:15 | 1171556 narnia
narnia's picture

The timing of this story is obviously politically motivated, but I think Citi is right.  The negative interest rate precipitated dollar decline would be more dramatic to date if the risk free assumption were taken out of the equation.

As long as the Fed continues to artifically keep rates down, I'm not seeing a whole lot of optimism for the $.  Euro weakness? at some point. Foreign flight to US assets? at a certain exchange rate way south of where it is, US would be a bargain. Export explosion? doubt it.

On the other side of that leger, the Yuan could float, Japan could come calling for their savings, the Euro could comparatively improve, the Saudi king could liquidate his $ position, the US municipal bond market could implode, the world can speed up diversifying away from the $ as a reserve currency, etc., etc.  I'm not sure where it will trade from day to day, but the outlook is no bueno. 

Thu, 04/14/2011 - 17:56 | 1170520 Exposer of Inte...
Exposer of Internet Shills's picture

Silver Bitchez!

Thu, 04/14/2011 - 17:54 | 1170521 Dan The Man
Dan The Man's picture


.....ahem!... QE3 ???  Whenever you're ready !!!

Thu, 04/14/2011 - 17:54 | 1170522 Monday1929
Monday1929's picture

Again I ask, Why would anyone listen to anything these failed, insolvent bankers have to say?

Thu, 04/14/2011 - 18:01 | 1170547 NotApplicable
NotApplicable's picture

Because this warning isn't a report of risk, but rather a threat of what they will do if the debt ceiling isn't lifted.

It's the same song and dance we heard with TARP 1, "bail us out, or else the market will crash." Congress votes against it, market crashes, Congress votes again, passing it, and the ponzi lives quietly for another day.

Thu, 04/14/2011 - 18:51 | 1170687 andybev01
andybev01's picture

Just like our dear leaders admitted that yeah, we waterboard people.

So what? Waddaya gonna do about it?

Thu, 04/14/2011 - 19:26 | 1170785 MrBinkeyWhat
MrBinkeyWhat's picture

"This is not a is a threat".

Cough up tax serf bitchez.

Thu, 04/14/2011 - 18:15 | 1170589 buzzsaw99
buzzsaw99's picture

Exactly. Nobody cares what that stupid fascist puke C has to say.

Thu, 04/14/2011 - 17:55 | 1170528 OutLookingIn
OutLookingIn's picture

"The USD will be in big trouble" WILL?????????


Once on the QE road, there is no way off.

Thu, 04/14/2011 - 17:59 | 1170533 silvertrain
silvertrain's picture

And just think that these people are getting paid for saying shit like this....

Thu, 04/14/2011 - 18:02 | 1170541 OutLookingIn
OutLookingIn's picture


Just look at how the fiat's have faired when priced in silver or gold?

All are going into, or are in the toilet!

Thu, 04/14/2011 - 18:20 | 1170600 I am Jobe
I am Jobe's picture

You can only say things like this if you graduated from an Ivy league school. State schools who gives a F? I guess C will provide free Vaseline if one opens an account with C.

Thu, 04/14/2011 - 18:04 | 1170545 virgilcaine
virgilcaine's picture

Tyler.. GOOG!  Timing the article posting on its MISS.

Thu, 04/14/2011 - 18:05 | 1170557 r101958
r101958's picture

They have a firm grasp of the obvious.

Thu, 04/14/2011 - 18:05 | 1170558 vote_libertaria...
vote_libertarian_party's picture

"Unsustainable debt risk"?

What?  I'm sure every person in the country can afford the $57,000 they owe. Leave out kids?  ouch.  Leave out people not working?  double ouch.  Leave out minimum wage workers?  triple ouch.  And we are adding $1.8T per year?...

Thu, 04/14/2011 - 18:10 | 1170567 Hedgetard55
Hedgetard55's picture

"When the world is running down,


You make the best of what's still around."

Thu, 04/14/2011 - 18:10 | 1170573 Camtender
Camtender's picture
"Significant Downside Risk For USD And JPY If Market Begins To Price In Unsustainable Debt Risk" - No Shit........
Thu, 04/14/2011 - 18:15 | 1170583 Racer
Racer's picture

Fake Market to Citi :  (Hearing aid switched to 0 volume)

Thu, 04/14/2011 - 18:18 | 1170594 AldoHux_IV
AldoHux_IV's picture

Translation: QE to infinity.

In other news the race to destroy one's currency just got more competitive.

Thu, 04/14/2011 - 18:18 | 1170595 buzzsaw99
buzzsaw99's picture

Now that we got our bailouts & bonuses it's time for peon austerity bitchez!

Thu, 04/14/2011 - 18:22 | 1170612 Hot Shakedown
Hot Shakedown's picture

US Dollar has now bottomed

Thu, 04/14/2011 - 18:25 | 1170617 Slin
Slin's picture

Englander.....I'm so scared...  Hey crook.. have you ever had your shit pushed in?

Thu, 04/14/2011 - 18:24 | 1170622 Quinvarius
Quinvarius's picture

USD/JPY, what happens when two black holes collide?

Thu, 04/14/2011 - 21:34 | 1171022 YouBetYourLife
YouBetYourLife's picture

You get Malia and Sasha.

Thu, 04/14/2011 - 18:31 | 1170628 virgilcaine
virgilcaine's picture

OT/Other news

TOP STORIES Google 1Q earnings miss analysts' target- AP

Google's first-quarter earnings came in below analyst projections as the Internet search leader sped up hiring and increased spending other areas to

drive up its expenses


-31.32 AH


Thu, 04/14/2011 - 18:32 | 1170640 Deep
Deep's picture

I love Zerohedge and all Tyler does, best site on web, but what I don't get is the constant cheerleading of a US dollar collapse. IMO that is just plain dumb and ignorant. A US dollar collapse will effect everyone, and i repeat everyone. It would be an absolutley devestating event, oil would be at god knows what, the grains, livestock, etc. The world would enter depression quite quick IMO, and wars would start.

I doubt silver or gold would keep up with the system collapse. And even if it did, most would be out of jobs, and everyone on this site acts as if 100% of their wealth is in PM's. I call bullshit on that.

So while everyone here is cheering it on, i think these same people would be then shitting themselves at what is happening around them.

Just my 2 cents.

Thu, 04/14/2011 - 18:51 | 1170683 hack3434
hack3434's picture

Wrong...not everyone is a coward and the issues must be dealt with now instead of trying to pass it on to the next generation. Grow a pair ffs.

Thu, 04/14/2011 - 18:56 | 1170699 andybev01
andybev01's picture

Nihilism, Bitchez!

Thu, 04/14/2011 - 18:57 | 1170707 Deep
Deep's picture

ok so dealing with the problem is to let the dollar crash. good one. you and the fellow ZH'ers here are quite weird. There are other ways to deal with it, like stop spending, raising taxes, reducing military, etc. etc. Ya we will have a very painful recession, probablly a depression, but it's better than a dollar collapse. but let me guess, your whole net worth is in silver, and your house and car are made of silver, and you wear silver clothes.

Get a life pal.

Thu, 04/14/2011 - 19:06 | 1170727 hack3434
hack3434's picture

The situation will dealt by force rather than choice. Deal with it...If you care some much about saving the US Gov't may I suggest you go here:

Donations seem quite low for the year. 


Thu, 04/14/2011 - 19:19 | 1170762 Deep
Deep's picture

Another poster above mentioned it, you really think the FED would allow a dollar collapse. They could raise rates, force congress to get serious, ya it would be very painful for everyone, but this outcome is much better than a us dollar collapse. You think a us dollar collapse is good for anyone? no it's not.

I ask anyone, all the elites and powerful, would they rather have a deflatinary collapse or hyperinflation and us dollar collapse. think about it.

All the dollar bears and speculators in commodities are being ropped in to believe the dollar "is on the verge of collpase"  to get slaughtered by Ben and the boys. Is a hyperinflationary event good for anyone. $300 oil is good for anyone?


Thu, 04/14/2011 - 19:36 | 1170803 hack3434
hack3434's picture


  • A currency "collapse" is not the end of the world.
  • We have ZIRP in place and we are barely getting by
  • Housing can't catch a bid with historically low rates 
  • IR Derivatives are a mess
  • The emperor has no clothes and the "elite" have the means to leave if TSHTF


Thu, 04/14/2011 - 19:46 | 1170826 Deep
Deep's picture

when the currency is the "reserve", ya it would be all hell broke loose. China loses what, 2 trillion, japan loses close to a trillion, all the pension funds all over lose everything in UST. Oil would be at 300+, all grains would be thru the roof, most of the world would starve when wheat is $200 a bushel.

the fact that we have a reserve, the us would not be the only one thats suffered, the whole world would suffer.

all i am saying is, a us dollar collapse is a much worse case then lets deal with the medicine, let the markets collapse 30-40%, slash spending, end QE, write off major debts.

But i guess you would rather have a us dollar collape, for what reason i dont know, but if you are like most ZH'ers, you want to see armagedden. For what reason, i have no clue. 

Thu, 04/14/2011 - 20:31 | 1170923 Howard_Beale
Howard_Beale's picture

Not all of us want to see that, Mr. Deep. Please don't believe this blog is only survivalists with no perspective. We are a very diverse group and I, for one, do not want to see a dollar collapse. I know I am not the only one. 

I have some PM's that were bought long ago. But in no way was my buying based on a currency collapse.

Thu, 04/14/2011 - 20:41 | 1170943 narapoiddyslexia
narapoiddyslexia's picture

Armagedden is the only way to bring down the government, and even then it might not work. What you suggest in your comments is sensible and if it happened then the government in its present form will survive. This possibility is disturbing, as the USG is an abusive, murdering despotism, that is ever more imprisoning its own people for political crimes. If the world has to suffer to give us a reasonable chance to destroy the Evil Empire, then it may wll be worth it in the long run. We won't live long enought to know in any event.

Thu, 04/14/2011 - 21:34 | 1171021 Mark McGoldrick
Mark McGoldrick's picture

Virtually everyone who has the capacity for reason, logic and the ability to understand real-world, civilized solutions would agree with you. Unfortunately, your logic will fall on deaf ears around here.

You need to remember who your audience is here: doomer libertarians, many of whom lust for urban warfare and anarchy so they can play out their bug-out, GI Joe fantasies. 

Doomer libertarians are quite similar to religious fanatics. They'd burn the world to the ground to protect their rigid, archaic ideologies (no matter what the consequences), rather than adapt to the dynamics of modern society.   

Personally, I think some aspects of libertarian ideology have quite a lot of credibility, but, just like Christian fundamentalism, that message is overshadowed by the whacked-out, cult-like devotion that you see among the followers.

When you realize that doomer libertarians are as goofy as faith healers, you'll suddenly find them to be a source of wonderful entertainment more than anything else.  

And that's the primary reason I roam through here...  for the laughs. 

Thu, 04/14/2011 - 22:17 | 1171127 mayhem_korner
mayhem_korner's picture

Thanks for gracing us with your broad-brush.  If we stop being funny, will you leave?

P.S. Keep your protective eyewear on while your in your closet polishing your stinger.

Thu, 04/14/2011 - 22:52 | 1171178 hack3434
hack3434's picture

As if our discussions can change the outcome...Believe what you want, it's a free country (sort of).

Thu, 04/14/2011 - 22:53 | 1171241 Silva Plata
Silva Plata's picture

When asked why he ordered the murder of a guy over a $30,000 gambling debt John Gatti is supposed to have said, "In a business where there is no accountability, there has to be accountability."

Until there is accountability for the crimes that killed the dollar it doesn't matter if we want the dollar to collapse. It's already a done deal. Let's hope next time there's more accountability.

Fri, 04/15/2011 - 00:41 | 1171438 Reptil
Reptil's picture

Postponing the inevitable (downturn of a cycle) is what got us here. A fake global economy built on a reserve currency that was once good as gold (and therefore accepted).

You're asking for more of the same? Doesn't sound very logical to me. Regardless what anybody here says or thinks, apart from the destruction of wealth for all those that don't own any PMs or stock (unsuspecting Joe 6 Pack), the issue at hand is that no one anywhere will want to own dollars. Ergo, end of dollar as reserve currency, enter SDR from behind the curtain.


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