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ECB's September Banking Sector Stability Report Opens Fresh Wounds, Sends Euro Lower
The recent decline in the futures is attributed to a 40 pip move lower in the EURUSD (yes, it is pathetic that the entire market once again is merely a tick for tick xerox of the FX pair, which in turn is driven almost exclusively by excess liquidity expectations/QE on either side of the Atlantic) which is attributed to the just released September issue of the EU Banking Sector Stability report. In it, the central bank opens up fresh wounds, by reminding just how fragile the European banking system is. Which should be a stark reminder for all who believe the euro will go straight up without interruption, that Europe is currently panicking and will soon gladly retract everything said recently in the Stress Farce about how stable the banking system is, if it means a drop in the euro and a resumption in exports.
From the report:
Conditions in both short and long-term funding markets were still far from normal in August 2010, and funding challenges for some banks remained substantial. Looking ahead, one area of concern is the risk of bank bond issuance being crowded out as a result of the significant increase in financing needs of several EU governments in the period ahead. In addition, banks may also face the prospect of higher funding costs owing to the need to term out their funding and because of increasing competitive pressures in markets for retail deposits. Moreover, the continued reliance of some banks on central bank refinancing facilities remains a source of concern.
As we are now back in a regime where the market correlates almost perfectly with a weak dollar, and thus a strong EUR, regional liquidity headlines such as this will continue to determine every move in the broader market.
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We are in a market whose ultimate aim is to make the Yuan worthless, and if that fails, to bring China to the Debt market - Hyperinflation as Federal Reserve policy
Actually this is just old wounds that not only never healed but have now turned gangrenous. The smart move here is to amputate, but who ever accused the powers that be of being smart when it comes to devising ways to serve the people. They only know how to serve their own special interests.
However, can kickers are very smart when it comes to data manipulation, rationalization, justifications and other Ponzi like activities.
But smart as in actually takeing steps to fix these problems. Don't make me laugh. :>)
Anglo Irish Bank again ?
Reference Number: USD10022
Transaction Type: REVERSE_TRANSACTION
Operation Type: LIQUIDITY_PROVIDING
Procedure: STANDARD_TENDER
Tender Date: 29/09/2010
Start Date: 30/09/2010
Maturity Date: 07/10/2010
Duration (days): 7
Auction Type: FIXED_RATE
Currency: USD
Fixed Rate: 1.19 %
% of All. at Fixed Rate: 100
Tot Amount Allotted: 60 mn
Tot Bid Amount: 60 mn
Tot Number of Bidders: 1
http://www.ecb.int/mopo/implement/omo/html/USD10022_all.en.html
Europe is currently panicking and will soon gladly retract everything said recently in the Stress Farce about how stable the banking system is, if it means a drop in the euro and a resumption in exports.
Japan is currently panicking and is happy to have its fourth largest bank fail, if it means a drop in the yen and a resumption in exports.
Brazil is currently panicking and will soon gladly retract everything said recently in the Petrobras prospectus about how stable the country is, if it means a drop in the real and a resumption in exports.
America is currently panicking and will soon gladly retract everything said recently on CNBC about how stable the banking system is, if it means a drop in the dollar and a resumption in exports.
I seem to notice a pattern here.
Let me guess. Panic? Or lies?
How about panicked lies?
He that panics first panics best.
It is times like these when a state-controlled media is very helpful.
What's that you say? I thought Operation Mockingbird was shut down decades ago?
http://en.wikipedia.org/wiki/Operation_Mockingbird
Correct, first rat off the ship wins!
Yep... a nasty pattern.
Economic health has become completely dependent upon the beggar-thy-neighbor policy of cheap currency. Even the leader of China recently admitted that his nation would explode if the Yuan rose at all.
The strategy of global wage arbitrage is rapidly approaching its end-point... implosion. It's all been just a multi-decade international game of overcapacity/underconsumption musical chairs. Who's butt hits the floor first?
Right there with ya' on the fact it'll be gettin' worse, but Never A Retraction.
Never Let A Crisis Go To Waste.
Once the Worst surfaces Past the Magnitude of the Heretofore Healed, Past Crisis, Another New and Improved "Excuse for the New" Crisis of Epic and Biblical Proportions Shall be Manufactured to Ensure Higher Taxes, Increased Regulations, Lesser Personal Freedoms and Continued Looting of the Department of Treasure by the Power Elite.
Yet the markets remain calm and stable. That's amazing. Let me guess it's already priced in.
Yep. The US budget for fiscal year 2010 ends tomorrow, and they're not even doing a 2011 budget until after the elections. Does anyone care? No. Because the MSM isn't talking about it.
Funny how we are supposed to be in the worst recession ever.
Yet RV stocks are taking off???
Well, sure. With so many Americans losing our homes, we need RVs to live in.
I was hoping for a re-post of the GMCR chart. Wondering how its doing today since all my knowledge comes from this androdyne's posts.
Goin' Mobile
"Watch the police and the tax man miss me"
Nice!
Consider it a knock-on effect of the RE implosion.
Are you looking for an answer more detailed than "people are friggin' idiots"?
I'm sure you mean ONE RV stock is up 16% this week.
Are you sure you're a trader? You sound a lot more like a moron to me. Though I guess the two aren't mutually exclusive.
Hey, as long as it's other people's money right?
thats because people will take out one more credit card, buy an RV and move to canada pikey style. dont long cad people remember fallout.
Of course they're taking off. Didn't the Vatican say something about UFO's coming to a city near you soon?
It will be like that scene from Independance Day where when Randy Quaid leads a floatilla of RV's across the desert to safety and they rescue Will smith.
At some point, the VIX has gotta really spike - all reality is ignored until "the pucker factor" shows up and the dreamers look into the abyss.
Basically, all bad news is getting shucked aside.
Nothing else matters except end of quarter performance anxiety.
No wonder these junk stocks are flying today.
So you are so desperate to see euro go down that even a 40 pip move lower which is normally not even noticed, is being advertised by ZH. Cmmon Tyler, you got to be better than that. Dont know if you ever worked at Buyside job but the market does not move the way you are presuming it to..
Shaddup, Johnny.
quit white knighting euro is a dirty slut
European stocks appear to be celebrating the turmoil, riots, and strikes going on everywhere.
+1
Ach-TUNG!!!
Doesn't look like that beer is getting all the way down to her stomach.
What stomach?
She does seem to have a very insincere lip lock on the actual contents of the mug of beer. On the other hand, her dress isn't designed to focus attention on that area of her anatomy.
That's because the Europeans are actually finally trying to cut the deadwoods and reverse the deficit growth through serious austerity measures. When was the last time US ever implemented these kinds of austerity measures to reign in their out-of-control spending? Instead, Bernanke basically has told everyone that he will print to eternity if the markets don't recover. On top of that, I don't know where you have been living but the Euro has been floating around 1.3 to 1.6 in the past few 5 years and that did not seem to have destroyed their economy. Here is the reason why..........euro exports are not as price sensitive because they are selling high-value add engineering products and deisgner labels and specialized products/foods/luxury brands that are less price sensitive. On top of that the biggest issue (as I posted yesterday below), Euro currency is actually NOT going up against other major currencies where they sell their products (Asia, BRIC, Middle East). In other words this is a story of USD, not euro. Yes Euro has problems like all currencies/countries but they actually seem to be doing something quite remarkable to try to turn their economies around on sounder, more efficient footing, unlike US which is just trying to borrow more time in their desperation.
this is what i posted yesterday;
first of all, I believe that USD is falling against MOST currencies, not just euro. Secondly, the euro nations actually do lot of their business with Asia and the BRIC countries including the Middle East so they are not totally dependent on US for their exports...........unlike a country like Canada whose currency will probably take a large downturn sooner or later. Germany controls ECB and the euro effectively, so I doubt that euro can collapse because unlike US, Euro countries are actually (especially Germany) competitive and have products that the world wants (especially the luxury and highly engineered products).
For those reasons, and also because the Fed (Bernanke) is going to desperately try to reflate/inflate/elevate their economy/asset price/stock market via massive QE and outright money printing tricks, and because the EU countries are actually making a serious attempt at not only not conducting massive QE but actually trying to cut deficit and make their economy more efficient, there is much better chance that the euro will gain (like other foreign currencies) against USD in the medium to longer-term. Of course if Ben's gambit fails and he loses the confidence of the global bond market (or the trade/currency war goes out of control), then in the short term we will likely see another massive run on the stock market/banks and perversely, the USD will shoot up as carry trades unwind and safe haven nature of USD beckons
Sounds like they have figured it out over there.
In typical fashion, many of the sleep walking over here in America are doing our best to follow our programming and defend our abusers. Thus we condemn those "lazy socialist union bums" while cheering that the abusers as finally "forcing discipline".
It's never black and white, but it is if you live in America. Of course, over here it is Democrat B&W and Republican B&W. Different shades of black and white I guess.
ohhhhh.
I hear ya, but nothing matters until it does, and it will. Pretty soon that warm diaper these bulls are sitting in will get mighty uncomfortable.
come on brian, hit the print button for the third time today
The Apocalypse has already been priced in. ps: Germany is a great country, especially in October.
EURO is back above 1.363. Now why dont you put that as headline. "EURO ignores bad news and is 40 pips UP".
Cmmon ZH, you can do better. Put something which is insightful. Dont just marry the Gold conspiracy idiots who lost all their wealth between 1980-2000 and now in their dying years yearas trying to regain whatever little they can. Gold should be banned from trading as it is dangerous to human economy.
I still don't understand how the gold bugs can assume that in the event of a full fledged global trade war/depression/sovereign credit crisis, that gold will go up or even hold it's current value? I mean, you can't eat or live on gold and I assume that gold will be sold off for liquidity (casyh!) in the event of a market meltdown? Basically if the global market collapses, I believe almost all asset prices will collapse and only cash will be worth something unless our society completely breaks down. In fact as we spiral into deflationary depression, everyone will be trying to sell their financial (and gold is basically a financial asset) assets for cash and real commodities.........
You can't eat or live on (gold, cash, seashells, tally-sticks) either.
Some can sure print cash though. They get first dibs at the trough.
Gold IS liquidity. This isn't rocket science.
I am sure that our bearing suppliers in Korea and Japan would accept gold in a pinch...
Europe is BANKRUPT.Still when did that stop the EU or the ECB.
Some good pics from the riots in Spain...civilized.
http://abroadabroadinspain.com/?ref=nf
The European people don't like it and are saying that if we have to get a cut, the bankers have to get a cut also. You notice that they haven't been showing to much of the riots and demonstrations going on all over europe. In the US they must keep thinking happy thoughts and showing rainbows and green grass.