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Europe Goes From Worse To Horrible: Ireland Broker Than Expected, Greece Mulls Splitting Up Into "Good" And "Bad" Greece

Tyler Durden's picture


Greece hasn't even filed for bankruptcy yet and the "unexpected" consequences are already coming. In comments to The Sunday Times newspaper, Irish Transport Minister Leo Varadkar said the country will likely need another "unexpected" loan from the troica, after he became the first cabinet member to cast doubt in public on Ireland's ability to raise cash. In other words once on the temporary bailout wagon, always on the temporary bailout gain. Reuters reports: "I think it's very unlikely we'll be able to go back next year. I think it might take a bit longer ... 2013 might be possible but who knows?" Varadkar was quoted as saying. "It would mean a second program (of loans from the EU/IMF)," he said. "Either an extension of the existing program or a second program. I think that would generally be most people's view." We wonder how German taxpayers will fell now that they realize they have not one, not two, but three (and soon 5 or more) heroin addicts they need to clean, wash, scrub, and feed on a monthly basis (with their, and US money, but Americans continue to not care that the biggest source of capital for the IMF is them). And speaking of ground zero, Greece is now scrambling after the Independent said that even Sarkozy is now prepared to let the Greek chips falls where they may. Following earlier news that the troika believes that the privatization plan it itself set up is not ambitious enough, Greece which now realizes that Germany, the EU, IMF, and Franch all are prepared to let it go, the country is now coming up with last ditch ideas faster than a speeding bullet: according to Reuters: "A Greek paper reported on Sunday that the government was considering setting up a Spanish-style "bad bank" to clean up its lenders' accounts from "toxic" Greek bonds and make them more attractive to potential buyers." Of course since it is toxic Greek sovereign bonds we are talking about, this implies that the country will somehow be split into a "good" and "bad" version of itself. And who thought financial innovation only comes out of the US.

From Reuters:

A 'bad bank', formed to hold risky assets owned by a state guaranteed bank, could be set up to absorb the risky Greek bonds held by state-controlled lenders slated for privatization, such as the Savings Post Bank, To Vima said.

"With problematic, Spanish savings banks (cajas) as a model, the finance ministry is examining proposals to implement the idea in the country," it said, without citing any sources.

Spain's Bankia, created from the merger of seven cajas, said last month it would create such a unit in a bid to attract investors ahead of a stock market listing.

Probability of success: 0.0%

As for Ireland being broker than expected:

Deputy Prime Minister Eamon Gilmore told broadcaster RTE that fears of a domino effect from Greece's problems were overblown. The possibility of a Greek default has sent bond yields rocketing for indebted Ireland, Portugal and Spain.

"It's not a situation that if Greece defaults then there are immediately implications for Ireland," Gilmore said.

"If Greece defaults there are implications for the wider euro zone and obviously we are part of that."

Ireland, meanwhile, wants to tap investors for funding in 2012 before its 85 billion euros EU-IMF bailout runs out the following year.

But investors believe Ireland will be unable to return to the market and instead will have to tap the European Union's permanent rescue fund in 2013, which might require some restructuring of privately held sovereign debt.

Reflecting this medium-term risk, Ireland's two-year and five-year paper are yielding close to 12 percent, more than its 10-year bonds on the secondary market.

Some 50 billion euros of the existing EU-IMF bailout has been earmarked for sovereign funding requirements with the remainder set aside to prop up the country's ailing banks.

Earlier this month, the IMF said whatever was left over after recapitalizing the banks could be channeled to the sovereign if there was a delay in returning to markets.

At the end of March, the Irish government said the banks needed 24 billion euros to bulletproof their balance sheets but Dublin hopes some five billion euros can be raised from imposing losses on junior bondholders and asset sales, meaning that 19 billion euros of the 35 billion would be tapped.

Gilmor's best defense: "It is wrong to put Ireland in the same basket as Greece."And coming soon to a theater next to, the story of the deputy PM who cried not bankrupt wolf.

The US may be on vacation, but the EUR, at a third of its regular volume and with substantially more volatility, sure won't be come 5 pm EDT.


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Sun, 05/29/2011 - 11:49 | 1320570 gkm
gkm's picture

You lost me at 'broker'.

Sun, 05/29/2011 - 13:45 | 1320745 knukles
knukles's picture

It means that the Greeks are openly entertaining discussions with "brokers" to attempt to take all the bad shit that's on thier books, transfer it to another specially set up entity that they say they will guarantee, which means all of the crapola is the collateral, have the ratings agencies rate it investment grade, sell bonds against it to morons, fools, little old ladies, infirmed children that have no chance whatsoever of getting their money back, promising profusely that they'll never fuck it up again so that they think that they can sell debt into the open market without the baggage which everybody knows is immaterial, for which the ECB will pay 100% for the collateralized hocus pocus since it's highly rated (anything backed by ouzo and stale baclava is money good) as well as the new reformed (heh heh... whose ever gonna trust the people that invented and had named after their counrty, Greek sex) country.  Where everybody will still be on vacation, protesting, not paying taxes, screwing the system and otherwise just not giving a fuck all about that shit in any case.

Easy as a fee to Goldman.


Sun, 05/29/2011 - 15:28 | 1320920 your neighbor
your neighbor's picture

have they considered selling the naming rights of the countries?

Sun, 05/29/2011 - 16:43 | 1321064 knukles
knukles's picture

Like name the Acropolis the "Goldman Arena".  I can just see it now, bright neon lights plastered over the returned Elgin Marbles...


                      Goldman Arena
               "Another Day of God's Work"

Sun, 05/29/2011 - 17:13 | 1321133 your neighbor
your neighbor's picture

I was thinking of Xe or Kellogg Brown & Root. They need to recruit more cost efficent labor... 

Sun, 05/29/2011 - 16:48 | 1321088 disabledvet
disabledvet's picture

no, but they have considered enforcing copyright on various Greek God's and names.  For example "it's now Adonis(tm)" and "Democracy (patented)."  Each time either a Greek name or system is used they are allowed a "Royalty (sic)"  Rumor(tm) is "Nike's first."

Sun, 05/29/2011 - 20:09 | 1321467 knukles
knukles's picture

"You never forget your first Nikeing."

Sun, 05/29/2011 - 11:52 | 1320573 speconomist
speconomist's picture

So con we expect the Euro plummeting at the opening as much as last week?

Sun, 05/29/2011 - 11:50 | 1320576 bugs_
bugs_'s picture

maybe greece will split into "bad" and "indifferent" rather than :"good".

(h/t ren/stimpy)

Sun, 05/29/2011 - 13:01 | 1320695 kaiten
kaiten's picture

bad and worse

Sun, 05/29/2011 - 15:24 | 1320911 margaris
margaris's picture

good = everything other than ATHENS

bad = all the places where big fat greek weddings took place

Sun, 05/29/2011 - 11:51 | 1320579 topcallingtroll
topcallingtroll's picture

The euro will strengthen if greece leaves and ireland pegs to the pound.

It is really not a huge amount of bad debt from a pan european perspective unless portugal joins brazil in a monetary union and spain is forced to leave.

Spain being extremely feudalistic and slightly nazi in its character will clamp down on its population and squeeze them harder to remain in the euro, but there is no way in the long run if the amount of hidden spanish debt is anywhere near estimates.

Sun, 05/29/2011 - 13:53 | 1320764 Fiat2Zero
Fiat2Zero's picture

Sorry, but no.

This is a house of cards. They are all indebted to each other. Greece and Ireland leaving will simply confirm that the rats are jumping ship, and the Euro's days are numbered.

Spain will be the nail in the coffin. Why do you think we are hearing nothing of violent protests (in rich places like Barcelona for Chrisakes).

Spain is just the beginning. The people on the bottom have figured out the game and the jig is up. Expect _massive_ change as everyone realizes that the Arab spring, is really the beginning of the war of the poor against the rich.

Sun, 05/29/2011 - 16:49 | 1321094 disabledvet
disabledvet's picture

I hear "kereitsu" ain't doing so well right now either.

Sun, 05/29/2011 - 16:18 | 1321021 BorisTheBlade
BorisTheBlade's picture

It is really not a huge amount of bad debt from a pan european perspective

The whole system is one big house of cards, you let one card fall, the whole system goes crumbling. That's because system reached debt saturation level, one has to issue new debt to pay the one already on the books, in that situation all debt is bad as it can never be repaid from the taxes, was never meant to be.

Sun, 05/29/2011 - 11:55 | 1320580 serotonindumptruck
serotonindumptruck's picture

Black Swan event may be imminent.

Sun, 05/29/2011 - 13:09 | 1320705 Sudden Debt
Sudden Debt's picture

Whatever they say, whatever they do, bond rates like theirs can't be afforded for a long time.

Yep, they're doomed.

Question is: who's next.


Sun, 05/29/2011 - 15:59 | 1320985 Motorhead
Motorhead's picture

When is Belgium's number up?

Sun, 05/29/2011 - 13:15 | 1320709 Roger Knights
Roger Knights's picture

Followed by a swan song.


Sun, 05/29/2011 - 13:28 | 1320727 disabledvet
disabledvet's picture

and a Stairway to Heaven

Sun, 05/29/2011 - 18:03 | 1321261 takinthehighway
takinthehighway's picture

I was thinking more along the lines of "When The Levee Breaks".

Sun, 05/29/2011 - 13:18 | 1320719 equity_momo
equity_momo's picture

Yup.  Increase in draconian capital controls.  Savers of fiat should start to worry , i know i am.   I doubt any Greeks or Irish with more than a simple 100k or so have it left in their institutions.   System is going into its death rattle.

Sun, 05/29/2011 - 15:25 | 1320909 BlackholeDivestment
BlackholeDivestment's picture

...have no doubt! This train has sailed right into the ''well timed'' masonic tomb.

Sun, 05/29/2011 - 11:56 | 1320584 Hacksaw
Hacksaw's picture

I have an idea, why doesn't these countries just spend whatever they are receiving in tax revenue? Can you say Iceland? Tell the TBTF financiers to stick it up their asses, refuse to pay debts, have however much government the people are willing to pay for.

If this way of thinking swept the globe I doubt there would be any $trillion bailouts for the TBTF financiers, no big tax breaks for the international corporate fascists, and serving in the government would be like jury duty, they would have to draft folks to be congress critters. What a wonderful world it would be.

Sun, 05/29/2011 - 12:05 | 1320598 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

You said it, bro.

I have a feeling I'd get laid more too.

Sun, 05/29/2011 - 12:20 | 1320629 Steroid
Steroid's picture

... by a firing squad!

Sun, 05/29/2011 - 12:18 | 1320621 scatterbrains
scatterbrains's picture

or better yet Ireland should take one more massive toke of ecb/imf loan money and buy physical gold then throw a managed revolution, default on the loans and dare them to swoop in with their US/BANKSTER cruise missiles.

Sun, 05/29/2011 - 14:14 | 1320782 DonutBoy
DonutBoy's picture

Yes, that's the right approach before you nationalize the debt.  Once you turn the TBTF financier's debt into the taxpayer's debt its too late.  In the case of the Fed, they largely bought the bad debt which the banks who replaced it with treasuries, so there's no repudiation possible.  In the case of a guarantee, which I believe in part is what's happened in Ireland - a repudiation is still possible with a new government rejecting the guarantee. 

Sun, 05/29/2011 - 12:00 | 1320586 dwdollar
dwdollar's picture

Bipolar Financing

Sun, 05/29/2011 - 12:00 | 1320587 breezer1
breezer1's picture

they could all seek economic union with iceland. new currency could be called the herring.

Sun, 05/29/2011 - 11:57 | 1320588 Burnsy
Burnsy's picture

It certainly should plummet. But in bizarro-world, which I must remind everyone that we now live in, it could just as easily hit 1.45 as Papawhatshisface announces that they'll sell the Acropolis for a much needed 60 Bn Euros to Goldman Sachs. Fuck this bullshit.

Sun, 05/29/2011 - 12:09 | 1320601 Burnsy
Burnsy's picture

One minute you're making some random shit up and the next minute your ramblings are confirmed by a major news source. Seriously now, fuck this bullshit.

Somebody please be an adult and inform Greece and Ireland that they are

1. Broke

2. Not benefitting from this bailout crap in the long run

This quote from a great article in Der Spiegel sums up the facts. One quote in particular stands out:

To ensure its national survival, Ireland should reject the European rescue effort and, instead, accept the failure of its banks as a necessary evil, Morgan Kelly recently said. The renowned professor of economics at University College Dublin knows who would be especially hard-hit by such a step: the ECB.

"The ECB can then learn the basic economic truth that if you lend €160 billion to insolvent banks backed by an insolvent state, you are no longer a creditor: you are the owner" Kelly wrote in the Irish Times earlier this month.,1518,764299,00.html






Sun, 05/29/2011 - 14:26 | 1320803 downwiththebanks
downwiththebanks's picture

They're only 'broke' if you believe the 'money' 'owed' to Banker-Gangsters is legitimate.  

It's not.  

Sun, 05/29/2011 - 16:06 | 1320992 Urban Redneck
Urban Redneck's picture

Surely you don't think the bankers loaned their own fat bonus bucks to the deadbeats?  No, they risked their depositors' paychecks and pensions - M.A.D. 


If ignorant both of your enemy and yourself, you are certain to be in peril.


Sun, 05/29/2011 - 15:04 | 1320881 M.B. Drapier
M.B. Drapier's picture

Here's the Morgan Kelly piece mentioned.

Sun, 05/29/2011 - 15:40 | 1320953 Muir
Muir's picture


thanks for link, answers a lot of questions.

What assets and how.


"About 48 percent said Greece's first priority should be boosting growth, 38 percent suggested proceeds from assets sales should be used to kick start the economy and 35 percent said the money should be used to help pay down its towering debt.

European Union officials have asked Athens to step up privatisations urgently and suggested setting up a trustee institution to help oversee the process, similar to the body that privatised East German companies after the fall of communism. [ID:nLDE74K046]

First in line for privatisation will be divestments in Savings Post Bank (GPSr.AT), OTE Telecom (OTEr.AT) and the country's two biggest ports.

A second wave next year will include an up to 34 percent stake in gaming firm OPAP (OPAr.AT) and an up to 17 percent of Public Power Corp (PPC) (DEHr.AT).

Some 71 percent agreed with Greece selling its stake in OPAP with 65 percent favouring PPC's stake sale.

The nationwide poll conducted with a sample of 1,264 people May 17-20 also showed that nine of 10 Greeks backed the government's plan to redevelop the site of the capital's old airport at Hellenikon. Officials have said the project could raise 5-7 billion euros.

In another opinion poll on Saturday, the ruling Socialists lost their lead for the first time since 2009 elections, while another showed them slightly ahead of the opposition. [ID:nLDE74R0BW]

Struggling to impose austerity measures to pull the country back from the brink of bankruptcy, the ruling PASOK socialists are seeing their popularity wane, while the main New Democracy opposition party is not benefiting their opponents' decline.

"Citizens seem to be disappointed and exhausted from the ecomomic policies," Pulse head George Arapoglou said. "PASOK continues to slide so New Democracy was expected to come ahead although it shows no marked improvement."

The next election is due in late 2013."

Sun, 05/29/2011 - 12:12 | 1320615 serotonindumptruck
serotonindumptruck's picture

Under that scenario, I would expect a sharp rise in the arms trafficking into that region of Europe. Both escalation in civil unrest and the level-of-force used by the state to mitigate such unrest would seem to be the logical consequence.

Sun, 05/29/2011 - 14:02 | 1320661 Use of Weapons
Use of Weapons's picture

Already costed in.

There's a reason Greece has been #4 in the world on arms imports for a while now. More importantly, they didn't gear up & help the coalition of the somewhat-willing, so still have them all. Somewhere. In storage. For their vast army. Ahem.

However, they do own 18% of the entire global shipping fleet, so who knows where that storage is. Apparently storing oil at sea in a tanker is cost effective, so perhaps it's the same with small arms.

Sun, 05/29/2011 - 14:13 | 1320776 serotonindumptruck
serotonindumptruck's picture

I suspect that there are still a wide variety of arms available from the former Yugoslavian states. Macedonia and Kosovo being the likely transit corridor.

Sun, 05/29/2011 - 14:21 | 1320796 Use of Weapons
Use of Weapons's picture

Does The Company still have a vested interest in the KLA? If it were the transit corridor, I'd suspect more political protection of the fronts.

People forget / ignore that Greece still has conscription, and a 37.1 / 1000 available and 14.6 / 1000 active serving. This is three times the weighting of the USA. If/when the shit hits the fan, there's a large section of the population [i.e. most males] who actually know how to fight.


And there's all those imports. Somewhere.

Sun, 05/29/2011 - 12:01 | 1320589 YHC-FTSE
YHC-FTSE's picture

Typical of the Greeks to come up with a schizophrenic solution. Good luck with that one, Victor/Victoria! Looks like Greece will be out of the Eurozone (Though probably not out of the EU) and into the Drachma. 


This describes most countries' economic plans perfectly: 

"Schizophrenia is a mental disorder characterized by a disintegration of thought processes and of emotional responsiveness.It most commonly manifests as auditory hallucinations, paranoid or bizarre delusions, or disorganized speech and thinking, and it is accompanied by significant social or occupational dysfunction."

Sun, 05/29/2011 - 12:02 | 1320592 HamyWanger
HamyWanger's picture

Greece is fine. Ireland is fine. 

Don't listen to permagloomers. A default can't happen because it would mean that the goldbugs have won, and the Pigmen will never allow such an humiliation. 

Sun, 05/29/2011 - 12:09 | 1320600 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

We still win, just later and with more gold!

Sun, 05/29/2011 - 15:44 | 1320958 Muir
Muir's picture

"A default can't happen because it would mean that the goldbugs have won"

"We still win, just later and with more gold!"


And you are both wrong, worldwide defaults means goldbugs have lost.

Sun, 05/29/2011 - 16:01 | 1320991 Rossalgondamer
Rossalgondamer's picture

How can you be so headless?

All perfect things on a downswing arise.


Sun, 05/29/2011 - 12:16 | 1320617 monkeys.pick.bottoms
monkeys.pick.bottoms's picture

Mr. HamyWanger again in his enjoyable red herring role of taking a piss. Greetings. The only question is when Greece defaults. I'm betting mid June (what if Mr. Martin Armstrong is right, after all?)

Sun, 05/29/2011 - 12:56 | 1320685 Mentaliusanything
Mentaliusanything's picture

Thursday 16th June ??

No - it will be because the advanced mid year reporting figures will be on the executives desk and they will hit the "sell all my shares button" on reading the bottom line. The big dip is baked in.

It will be ugly even with all the lipstick on the Pig

Sun, 05/29/2011 - 13:14 | 1320645 Comrade de Chaos
Comrade de Chaos's picture

You (HW) are missing one important aspect of the sovereign indebtedness. Unlike the corporations which avoid defaulting till the end, a government can chose to default due to considerations of a grave social impact of not doing so. As the matter of fact most sovereign defaults have happened prior to the government inability to pay those loans off.

 A government can chose not to tax, not to sell national treasures or not to undertak the extra round of austerity measures required by IFM. 

Also, it is very probable that the word default will be avoided and restructuring or some more politically correct term will be used, however for all practical purposes it will be what it will be - a default. 

In addition, the number of defaults world wide might exceed all of the expectations. It is always hard to take the first step, however once a certain country defaults first, it makes it much easier for everyone else to rationalize "hey they did it as well, we are not alone.." and go for a default before the technical default occurs.


p.s. let's not junk HW, he's entitled to his opinion. 

Sun, 05/29/2011 - 16:19 | 1320961 Muir
Muir's picture

"In addition, the number of defaults world wide might exceed all of the expectations. It is always hard to take the first step, however once a certain country defaults first, it makes it much easier for everyone else to rationalize "hey they did it as well, we are not alone.." and go for a default before the technical default occurs."


And how's this good news for silver?  _ edit: that was short for deflation





Sun, 05/29/2011 - 12:34 | 1320654 Smiddywesson
Smiddywesson's picture

Pigmen win by slowly buying gold and then announcing a gold standard, thereby making it their idea and presenting themselves as saviors of the world (when in fact they created all these problems)

Sun, 05/29/2011 - 15:06 | 1320880 wandstrasse
wandstrasse's picture

this is EXACTLY what I am thinking. THEY allow their fiat-ponzi to collapse when THEY have enough PMs in their vaults to rule the world. Not before.

Sun, 05/29/2011 - 15:47 | 1320969 Muir
Muir's picture

Are you and Smiddy jacking off while stroking your Eagles?

Do you even realize how stupid you sound?

Sun, 05/29/2011 - 16:17 | 1321024 wandstrasse
wandstrasse's picture

how are you so certain that the current elite is NOT preparing for a PM standard? I could be of the unworthy ZH trolls but I am really interested in your argument against this.

Sun, 05/29/2011 - 16:40 | 1321067 Muir
Muir's picture

"how are you so certain that the current elite is NOT preparing for a PM standard?"

1. What would serve their interests better?  (Would a deflationary collapse help / hurt their interests?)

2. This isn't 08 when they where caught with their pants down as bondholders.


There's so much more to answering your question.

I do believe in owning gold, by the way.

Sun, 05/29/2011 - 16:22 | 1321031 geminiRX
geminiRX's picture

Considering that central banks around the world are still buying, I would say that you are on the wrong sidevof this trade. Gold is insurance...plain and simple

Sun, 05/29/2011 - 16:45 | 1321074 Muir
Muir's picture



I own Philharmonics (said so many times)

So I agree.



Sun, 05/29/2011 - 12:41 | 1320666 topcallingtroll
topcallingtroll's picture

gold bugs don't win if greece and Ireland leave the euro.  Sometimes you have to amputate a couple of limbs to save the body.

Sun, 05/29/2011 - 12:56 | 1320686 DeadFred
DeadFred's picture

The Pigmen have purchased many very smart people to work for them so they may ba able to have a default and still slam the goldbugs. On the other hand the demons in hell are excited with anticipation, they know how tasty Pigmen are.

Sun, 05/29/2011 - 13:49 | 1320758 knukles
knukles's picture

Get with the program, Hermie.

The EU, ECB, IMF, et al, have publicly stated that they do want to extend another round of financing to the Greeks.............

..................with the Central Bank of Greece collateralizing the loans with Greece's Gold Reserves...........

They want the loan, they want a default, they want the gold.

Hymie, the pigmen are the Ultimate Gold Bugs.
Wake the fuck up. 

Sun, 05/29/2011 - 15:54 | 1320974 Muir
Muir's picture

No they want the ports, not the gold.




"About 48 percent said Greece's first priority should be boosting growth, 38 percent suggested proceeds from assets sales should be used to kick start the economy and 35 percent said the money should be used to help pay down its towering debt.

European Union officials have asked Athens to step up privatisations urgently and suggested setting up a trustee institution to help oversee the process, similar to the body that privatised East German companies after the fall of communism. [ID:nLDE74K046]

First in line for privatisation will be divestments in Savings Post Bank (GPSr.AT), OTE Telecom (OTEr.AT) and the country's two biggest ports.

A second wave next year will include an up to 34 percent stake in gaming firm OPAP (OPAr.AT) and an up to 17 percent of Public Power Corp (PPC) (DEHr.AT).

Some 71 percent agreed with Greece selling its stake in OPAP with 65 percent favouring PPC's stake sale.

The nationwide poll conducted with a sample of 1,264 people May 17-20 also showed that nine of 10 Greeks backed the government's plan to redevelop the site of the capital's old airport at Hellenikon. Officials have said the project could raise 5-7 billion euros."

Sun, 05/29/2011 - 15:36 | 1320939 cosmictrainwreck
cosmictrainwreck's picture

Hamy - I agree; they'll cook up some kinda bullshit....they always do

Sun, 05/29/2011 - 12:07 | 1320599 Dismal Scientist
Dismal Scientist's picture

Good bank = the Greek Isles

Bad bank = the rest of the country

Just IPO the good bank to the financial community, and get on with it already. They're not interested in the bad bank, unless they can buy cheap CDS on it.


Sun, 05/29/2011 - 12:18 | 1320630 Zero Debt
Zero Debt's picture

The good bank-bad bank routine is actually a negotiation strategy and the point is to get the money of the depositor. "Oh, don't worry about the bad bank, it's always like that, I'll help you out, I'm the good bank."


Sun, 05/29/2011 - 12:08 | 1320604 lizzy36
lizzy36's picture

Good bank bad bank worked as well for Lehman as one expects it will work for Greece.

The thing about addicts is the first hit is always the best, and a good addict will chase the high until rehabbed.


Sun, 05/29/2011 - 12:32 | 1320650 Tyler Durden
Tyler Durden's picture

One thing to have a good bank, bad bank, when the only product segregated is corporate debt. It is slightly more complex to have a good country, bad country, when you are talking about sovereign debt.

Then again it hints at the endgame: good world/bad world, with the global central banks taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun. Aka: coordinated global currency devaluation (as these are assets, suddenly worthless, supporting global central bank liabilities - i.e. currencies).

Sun, 05/29/2011 - 12:37 | 1320665 topcallingtroll
topcallingtroll's picture

It smacks of discriminating against sovereign debt holders. 


Greek retirement plans with greek sovereign debt would not be restructured, but everyone else would be. 

Sun, 05/29/2011 - 13:04 | 1320698 Ethics Gradient
Ethics Gradient's picture

For a top calling troll I don't think you're anywhere near doom and gloom enough!

I reckon there's quite a large possibility that Greece will dissappear up it's own Khyber Pass if they default. Nothing will be sacred (or rescuable).

Leo? What does your pulse do at the moment whilst thinking about Greek pensions?

Sun, 05/29/2011 - 14:34 | 1320826 downwiththebanks
downwiththebanks's picture

Sure thing:  Greece will disappear.

Sun, 05/29/2011 - 17:09 | 1321125 fockewulf190
fockewulf190's picture

...and revert back to City-States.  New Sparta...New Corinth...New Athens.

Sun, 05/29/2011 - 13:28 | 1320731 disabledvet
disabledvet's picture

i recommend "filing an EEO complaint" followed by initiating grievance procedures "with the apporpriate union officials" (Prime Minister sounds good) followed on by various veterans preference claims, (we have f-16 fighter jets mo fo!) etc, etc...

Sun, 05/29/2011 - 12:51 | 1320682 lizzy36
lizzy36's picture

EU wants to ringfence Greece. The ECB, Geithner (who decided against haircut in Ireland (as to who gave him that authority......?) and Bernanke are all paranoid about systemic risk.

And everyone pretending that Greece isn't BSC 2.0.

Private debt becomes public debt which cannot be inflated away at a quick enough pace. So lets throw some worse money after bad money, and hope we can plug the hole, until such time as inflation (devaluation) can reach critical mass.

Sun, 05/29/2011 - 13:00 | 1320697 Use of Weapons
Use of Weapons's picture

"If it gets bad enough, you can always chop three noughts off the end you know".

Source: banker. He was referring to dollars though.


At this point in time, I'm actually having issues finding any 'good' money, unless the Europeans harken back to ye olde standards: the Church (learnt never to disclose gold holdings; fairly believably touted as client X who offered to bail the UK via a sweet, if bonkers, old Lord), Monarchy (again - still holding onto all those lands, and the other tout for client X) and... the other ones. But they print the stuff anyhow.

Not sure why everyone is so bullish about a gold standard - apart from countries, the holders of it tend to be reactionary friends to the banking class, you know.

Sun, 05/29/2011 - 15:59 | 1320989 Muir
Muir's picture


"Then again it hints at the endgame: good world/bad world, with the global central banks taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun. Aka: coordinated global currency devaluation (as these are assets, suddenly worthless, supporting global central bank liabilities - i.e. currencies)."


Then again what it really hints at is deflation ("taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun")

Your words, ""taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun" not mine.

That's trillions of confetti pieces dissapearing poof and gone.

Can't be collarilized. no CDO for it, nada, it's gone. Sorry no credit is available for it.

"as these are assets, suddenly worthless, supporting global central bank liabilities - i.e. currencies" yeap, your words. Dead money, stuck there, just dead, not moving.


Sun, 05/29/2011 - 16:43 | 1321066 Tyler Durden
Tyler Durden's picture

Your statist view continues to amuse. The Fed will merely sit there and watch as trillions of confetti disappear.



Sun, 05/29/2011 - 16:52 | 1321091 Muir
Muir's picture

" The Fed will merely sit there and watch as trillions of confetti disappear."


It has!!!!!!!!!!!!!!

There was no helping it.

They were powerless.

What you, (this present incarnation of Tyler, which surely, is not my most worthy adversary so far) miss, uniformly, is that credit is money in a fiat economy.

You statist views befuddles me.

Sun, 05/29/2011 - 16:55 | 1321097 Tyler Durden
Tyler Durden's picture

Powerless to send the CRB up 100% in a few months? Oh wait, the market is wrong as per deflationists.

Weimar was helpless to do much about the economy. It was very helpful in demonstrating what happens when infinte printing is the only solution.

Keep trying.

Sun, 05/29/2011 - 16:56 | 1321106 Muir
Muir's picture

You did not address even a single point I brought up, not one.

Your response is the straw man German hyperinflation stale argument.

You see things two dimensionally, in (at least) a three dimensional World.

Sun, 05/29/2011 - 17:02 | 1321109 Tyler Durden
Tyler Durden's picture

From the latest Privateer:

In nominal terms (expressed in its own currency), the US Dow remains the best performing major market of the ones we cover on a weekly basis on our website. In fact, the only three major market indices which show a gain of more than 5.0 percent so far this year are the Dow, the Nasdaq and the S&P 500. The next best is the French market - up 3.84 percent.

By contrast, Gold is up just over 8.0 percent in US Dollar terms this year while its rise against the Euro is an anaemic 1.0 percent and it is down 1.0 percent against the Swiss Franc. Silver, which has been savaged over the past month, is still up much more than ANY major stock market this year in terms of ANY currency. Silver is up 12.3 percent against the Swiss Franc, 14.6 percent against the Euro and 22.6 percent against the US Dollar since the start of 2011.

In other words: that damn deflating dollar just can't catch a break.


Sun, 05/29/2011 - 17:09 | 1321115 Muir
Muir's picture

"Gold is up just over 8.0 percent in US Dollar terms this year while its rise against the Euro is an anaemic 1.0 percent and it is down 1.0 percent against the Swiss Franc."


Wow, hyperinflation here we come!

Give me a break. Gold...while its rise against the Euro is an anaemic 1.0 percent and it is down 1.0 percent against the Swiss Franc."

That's your best?!!!(bring on another Tyler, you've been KOd)

Sun, 05/29/2011 - 17:13 | 1321139 Tyler Durden
Tyler Durden's picture

Just as KOed as all those others who sold gold and silver on March 18, 2009.

Sun, 05/29/2011 - 17:27 | 1321160 Muir
Muir's picture

Another straw man argument.

As I bought as early 1999-2000 (and ok, as I said before, I bought by mistake since buying in 2000 doesn't make sense even to me)

And yes, I still have every tube I ever bought from Monex delivered via USPS


Just answer some simple points and stop with these silly straw man arguments.


"Then again it hints at the endgame: good world/bad world, with the global central banks taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun. Aka: coordinated global currency devaluation (as these are assets, suddenly worthless, supporting global central bank liabilities"


Is this not a case book definition of the destruction of money?

Sun, 05/29/2011 - 23:58 | 1321814 goldsaver
goldsaver's picture

It would be if the ECB would allow it to happen. Because, you know they would never ring up Bernanke for a quicky little loan of freshly printed coupons to make up for the shortfall in Greek garbage. Since they have never done that before, I couldnt imagine them doing it again. And of course that is so positive for US currency that AAPL will surely reach $900 a share by July. And that must mean that mean old gold (along with other commodities) will drop right back to $600 an ounce and silver will go back to $7 an ounce (since it only costs $5 to dig out of the ground...

Sun, 05/29/2011 - 16:59 | 1321110 disabledvet
disabledvet's picture

"and the world will be MINE to do with as I PLEASE!"  obviously at 25 percent "a bid is still...

Sun, 05/29/2011 - 13:30 | 1320729 dracos_ghost
dracos_ghost's picture

This is a slippery slope isn't it. Intellectual rationalization of what good/bad debt is supposed to be. The riots will turn into outright civil war. And all to secure what? Faith in the global markets -- let them die. Let's promote economic survival of the fittest. I still don't get why bond holders are presumed to be guaranteed their debt. It's the old Animal House saying:

"You fucked up, you trusted us".

Elitist have to learn that they sometimes lose too.

Part of the problem with this scenario is that the decision makers of course will categorize their "schtuff" as prime and everyone else's as garbage. Needless to say, that's a bad recipe for disaster.

I agree with you about the endgame. But I'm not sure what purpose it serves. It would seem to be a short term strategy at best since eventually, the "peasantry" will have nothing left to lose and say "Fluck You" to the Little Lord Fauntleroys who won't admit they're wrong and try a new strategy.


Sun, 05/29/2011 - 13:54 | 1320759 knukles
knukles's picture

The ultimate inflation spike...
...wherein the holders of PM's are the winners.

Sun, 05/29/2011 - 14:04 | 1320769 kito
kito's picture

So we will have devaluation. All things will continue to be priced in relation to those that are worth more or less. How do we know that it logically leads to all hell breaking loose? Mexico, argentina, england, and numerous others have had currency crises, and aside from some short term disruptions, people moved on rather quickly. What historical basis do we have for zh expectations of massive social upheaval?

Sun, 05/29/2011 - 17:10 | 1321054 M.B. Drapier
M.B. Drapier's picture

But isn't the plan here closer to good banks/bad Greece? Sure, it doesn't seem to make any sense as a way to avoid sovereign default; but if the intention is actually to save the banks by letting the sovereign (which is bust anyway) default for them ...

And it makes sense if the EU is now resigned to a Greek default. If it's inevitable, might as well get as much good (and as little financial-sector contagion) out of it as possible. Carry off everything of value, pile up the debts: we've seen this movie before.

Sun, 05/29/2011 - 20:44 | 1321507 THE DORK OF CORK
THE DORK OF CORK's picture

I thought we were family !!


Sun, 05/29/2011 - 18:19 | 1321300 vocational tainee
vocational tainee's picture


Sun, 05/29/2011 - 12:11 | 1320612 JR
JR's picture

The machination of  Europe was what prompted Jefferson and his peers to form a nation apart.  And while looking at Europe today (and America today after formation of Keynes' IMF/World Bank at Bretton Woods, NH) we have more important business to attend here at home.

Here is America’s Memorial Day remembrance of her lost freedom of speech and the right to assemble that our forefathers died to achieve in the American Revolution…

Adam Kokesh body slammed, choked, police brutality at Jefferson Memorial

Sun, 05/29/2011 - 12:17 | 1320620 JR
JR's picture

Here’s how Lew Rockwell (May 28) describes the Jefferson Memorial arrests (see video link above) :

Adam Kokesh and other libertarians were arrested at the Jefferson Memorial for silent dancing, which outraged the prison guards. It reminds me of how much I despise the monuments in DC. They’re all pagan temples to the goddess USA and her various divinized emperors. Jefferson’s makes him a Roman godling. Washington’s honors the Egyptian sun god Ra. Lincoln’s portrays him as Jupiter. The Capitol is another temple, complete with a painting of the apotheosis of George in the ceiling of the rotunda. The Supreme Court is a pagan temple, too. Protesters will always be brutalized in the capital of the world police state. Nothing good is to be expected from DC, let alone its self-worshiping religious memorabilia. Love liberty? Avoid the Beltway like the plague it is. (Thanks to Sam)

Here’s retired Professor of Finance Michael S. Rozeff describing the Jefferson Memorial arrests (May 29 on the Lew Rockwell blog) :

Lew, that video of dancers being arrested inside the Jefferson Memorial is priceless. Their harmless motion can hardly be distinguished from strolling or holding hands while walking. How is it that an armed revolt against Gaddafi becomes a matter for Washington approval and armed support at the highest levels, or that masses of unarmed people protesting Mubarak become the legitimate voice of Egypt, or that Obama stands on the side of all sorts of human motions in the streets of Arab countries against government officials (some elected), but in America the least little thing that makes a statement or presents a challenge to authority is suppressed with force? How do we explain this disconnect? By American authorities being utter liars and hypocrites.

Are America’s leaders going to stand aside if some “minutemen” or some other massed group appear who take over an armory or stop traffic somewhere or dance around the steps of the Supreme Court temple, or simply appear en masse in the streets of Washington and demand that Congress disband or Obama step down or that the Supreme Court justices pack their bags and leave town? Are they going to hail that as democracy and the legitimate voice of the people? Of course not, as they cannot even stand people moving around inside the Jefferson Memorial. They showed their true colors at Waco. They showed it again in that video. So what is all this talk about democracy that they are feeding us? Why is Obama promising billions of American dollars to support these emerging Middle Eastern democracies and “human rights”? What’s the real agenda, for it sure isn’t what he says it is. I think we all feel the real agenda intuitively or in our bones: the power to control events and keep people in their place. If the dictators no longer can control the people in these countries in accord with U.S. aims, then switch over to “democracy”, in which the control rests in the hands of representatives and parliaments. America is a prime example of how that works out.

Sun, 05/29/2011 - 12:35 | 1320658 topcallingtroll
topcallingtroll's picture

Protests in the monument area are limited.  Otherwise it would be a constant protest zone.


I tend to agree with the reason.  Families come to visit these monuments and tell their children about the heroes.  It would be one non stop protest with various groups going 24 hours a day seven days a week at the jefferson memorial and other spots if protests in this area weren't limited.

Those spots are protest magnets and there would never be a break between the various protests if some limitations weren't enforced. 

Any coordinated action is considered a protest in this area, even singing together.

Sun, 05/29/2011 - 12:59 | 1320696 serotonindumptruck
serotonindumptruck's picture

Why must we maintain this ridiculous facade which demands blind obedience to the state? These disgusting concepts known as patriotism and nationalism are intended to appeal to emotion, and thus the masses are more easily manipulated into being the willing debt slaves of the elite.

The action by the state in this instance is designed to instill fear.

Be patriotic or the state will send their jack-booted thugs after you.

Sun, 05/29/2011 - 13:23 | 1320724 JR
JR's picture

Thanks for your response, tct.

Unfortunately, this can be the rationale on limitations on all forms of protest.  At political conventions, shouldn’t the earnest delegates be allowed to practice their “democracy” without being called names or seeing their traffic ways blocked?...  Hence, a nice “protest zone” can be set up a block or two away from their political "convention."  Shouldn’t the President’s motorcade be allowed to pass through flag waving admirers and the little ones be allowed to see their government "heroes” for a pleasant civic lesson without rowdies shouting “How many kids did you kill today?”

As you can see on the video above, the “no dancing” soon becomes “no talking” and finally “no video.” Surely our young future citizens will then enjoy their experience much better in the Jefferson Memorial.

If memory serves, one of Tom Jefferson’s major quotes used in large letters inscribed inside the memorial is “I Have Sworn Upon the Alter of God eternal hostility against every form of tyranny over the mind of man.”

Asks the little child: “What does that mean, Daddy?”  Replies Daddy: “No dancing.”

Sun, 05/29/2011 - 13:45 | 1320748 Terminus C
Terminus C's picture


Sun, 05/29/2011 - 13:33 | 1320736 disabledvet
disabledvet's picture

dear God!  there's a protest in front of a statue of a guy who was willing to die for his right to protest!  "were they singing we can dance if want to, though."  seemed contrived.  "i want serious boogey woogey" in my protest vids.

Sun, 05/29/2011 - 13:40 | 1320746 Terminus C
Terminus C's picture


Let me get a hold of your circular logic on this one:

Families come to show their children the 'heroes' of the USA, who stood up for their beliefs and protested against those who would suppress their freedom to do so.

These same families would be offended by people still doing that in modern times would be an athema to this spirit?  I think it would show the spirit living on and make for a 'teachable moment'.

You are shilling for facism here Top and your logic has been called out.

Sun, 05/29/2011 - 14:10 | 1320774 Use of Weapons
Use of Weapons's picture

Then again, it wasn't exactly Tiananmen square, was it?

In saner times, with a more suitable police mentality, the conversation would have gone something like this:


Policeman: Hi there. Yes, I get the point, but you're drowning out that tour guide's lecture

Protestor: Fascist! I have a right to protest where-ever I like!

Policeman: Yes, you can. You can also dance if you want. But don't be a dick about it.

Protestor: So you're not annoyed? You're not going to rise to my obvious trolling?

Policeman: No, not really. Please be considerate of other people though - shall we vote on who wants the protest, and dancing, and who wants to listen to the tour?

Protestor: But they're mindless sheep!

Policeman: Yes. But they have the same rights as you. Shall we vote?

Protestor: But they're too stupid to understand why we're protesting! We're the vanguard! If we vote, we won't win.

Policeman: Now you're beginning to understand why I don't care if you dance in here. As long as you don't interfere with the tour guide. And aren't a total dick about it.


Oh for more sophisticated times.

Sun, 05/29/2011 - 16:01 | 1320968 JR
JR's picture

Alas, the lesson to be learned here is that we’re not moving toward your scenario of “saner times.” On its way out of town this Memorial Day holiday, Congress just didn’t extend the Patriot Act, they made it cut deeper than ever into the liberties of the American people.  How long will it be before those Jefferson Memorial dancers are standing on Connecticut Avenue staring down a 68-ton M1 Abrams battle tank – reminiscent of Tiananmen Square?

P.S. Your scenario suggests an interruption of a tour guide talk or singing – apparently neither present in this event.

Sun, 05/29/2011 - 16:35 | 1321052 Use of Weapons
Use of Weapons's picture

I thought the guy in yellow who "officially" closed the memorial (the policeman tells people its closed, the guy in yellow exits and informs everyone that it is temporally closed) was the tour guide. Official monument caretaker? And ye, sorry - /sarc tag; obviously the US isn't heading for saner times, its heading for civil war & probable collapse.

Patriot act being renewed on Memorial day? Clocked for the irony. Being from a place where the elite are known for their snarkiness [let's ban May Day, eh], I'm no longer surprised at the urbane, educated, very large "FUCK YOU'S" that are sent out in a dismissive fashion on the assumption that most people won't notice, and the ones that do... don't count.

However - pissing off a person who has an absolute mandate for violence given by the State is stupid. Co-opting in a funny way? Cool. Pissing off an authoritarian no-body for your website? Not so cool. Kinda pathetic. A pro would have had the policemen forming a conga line with them.

Sun, 05/29/2011 - 17:03 | 1321118 disabledvet
disabledvet's picture

"YOU, TOUR GUIDE of DC.  You just brought up the word JOHN ADAMS!  You're UNDER ARREST!"  now THAT would be a good U Tube Vid.

Sun, 05/29/2011 - 14:35 | 1320828 downwiththebanks
downwiththebanks's picture

People love their slave-rapist heros.

Sun, 05/29/2011 - 15:13 | 1320891 Terminus C
Terminus C's picture

this is also true

Sun, 05/29/2011 - 12:56 | 1320690 gtb
gtb's picture

"The police acted stupidly."    Insightful quote by the Chimp-in-Chief

Sun, 05/29/2011 - 14:11 | 1320779 BernankeHasHemo...
BernankeHasHemorrhoids's picture

Obama and his criminal henchmen have no more legitimacy than Gaddafi. Several million people marching on Washington armed with AK-47s and willing to uphold the spirit of their patriot ancestors would change things and restore liberty at last. Sadly the American people deserve exactly what they are receiving. Kneel slaves!

Sun, 05/29/2011 - 16:17 | 1321016 YHC-FTSE
YHC-FTSE's picture


Sun, 05/29/2011 - 16:31 | 1321044 Urban Redneck
Urban Redneck's picture

Republics decline into democracies and democracies degenerate into despotisms.


Still true after over 2300 years. 


Sun, 05/29/2011 - 17:08 | 1321122 disabledvet
disabledvet's picture

this despotism brought to you by....Coke a Cola!  "Still refreshing after 2300 years, too!"

Sun, 05/29/2011 - 12:39 | 1320668 dick cheneys ghost
dick cheneys ghost's picture

Thanks for sharing the video was nice to know ya...

Sun, 05/29/2011 - 12:11 | 1320613 Bleeping Fed
Bleeping Fed's picture

Methinks the sheeple/HFT algos will no longer be buying the dip after Greece hits the wall.

Sun, 05/29/2011 - 12:18 | 1320622 Bindar Dundat
Bindar Dundat's picture

I used to teach my kids the difference between 'Good touch-bad touch' .  I always thought it was an OK way to describe the act of perverts..... and now we have this?  God help us!

Sun, 05/29/2011 - 12:22 | 1320631 BandGap
BandGap's picture

What a fuckin" mess.

All addicts need enablement. This is just one bend over daisy chain and the US is next in line. Round and round, down and down.

Honestly, I would just like to watch the implosion, this build-up is killing me.

Sun, 05/29/2011 - 12:58 | 1320693 cowdiddly
cowdiddly's picture

I don't think you will have to wait past August. I think the whole thing will come down this summer. All at once no, but piecemeal it will, its already starting.

Sun, 05/29/2011 - 16:31 | 1321045 geminiRX
geminiRX's picture

I recall people saying that last summer and the summer before.....I am impatient too!

Sun, 05/29/2011 - 14:36 | 1320832 downwiththebanks
downwiththebanks's picture

The 'addicts' are, of course, the money-addled Banker-Gangster parasites, right?

Sun, 05/29/2011 - 12:23 | 1320632 The Axe
The Axe's picture

China will step in to save the day.....Like UnderDog...

Sun, 05/29/2011 - 18:46 | 1321346 huggy_in_london
huggy_in_london's picture

China ARE the problem...well, part of the problem anyway.

Sun, 05/29/2011 - 12:20 | 1320633 holdbuysell
holdbuysell's picture

"Deputy Prime Minister Eamon Gilmore told broadcaster RTE that fears of a domino effect from Greece's problems were overblown."

Well, there's the public denial from a top official.

Time to head for the exits?

Sun, 05/29/2011 - 15:59 | 1320987 slewie the pi-rat
slewie the pi-rat's picture

ordinarily, yes.

but don't forget.  this is ireland!

Sun, 05/29/2011 - 12:25 | 1320638 disabledvet
disabledvet's picture

?  Anywho "how about Germany splits between good and bad" too?  If this is disorderly--we'll see who's holding the Spanish bonds immediately.

Sun, 05/29/2011 - 12:29 | 1320651 boiltherich
boiltherich's picture

"And speaking of ground zero, Greece is now scrambling after the Independent said that even Sarkozy is now prepared to let the Greek chips falls where they may."  Sure now that Credit Agricole, Credit Lyonnais, BNP Paribas, Banque Nationale, and Societe Generale have had their exposure to sovereign debt sterilized onto the backs of Greek (and Irish, Portuguese) taxpayers. 

Bad bank good bank is just another way of saying privatization of profits and socialization of losses. 

By the way, all those volcanoes erupting in Iceland, maybe they are not eruptions but the Icelandic people dumping and burning all their debt foisted on them by bankers. 

As a citizen of Ireland I just want to say to the bankers and the troika that forced the bailout on Ireland  ..|..

Doubly fucked here since I am a dual citizen of the US and Ireland, the bankers say my share of debt is what?  A million?  More?  Don't matter because I am notta gonna pay!

Sun, 05/29/2011 - 12:34 | 1320657 Lord Welligton
Lord Welligton's picture

"Of course since it is toxic Greek sovereign bonds we are talking about, this implies that the country will somehow be split into a "good" and "bad" version of itself."

Now that is funny.

Sun, 05/29/2011 - 12:46 | 1320672 topcallingtroll
topcallingtroll's picture

I feel confident they are going to try the old trick of picking and choosing which bonds they keep current.  They will obviously keep current those greek bonds held by greek banks and greek retirement funds.

Sun, 05/29/2011 - 17:06 | 1321124 disabledvet
disabledvet's picture

far simpler than Tyler is portraying it. "Women over here, men can stay right where they are."

Sun, 05/29/2011 - 12:49 | 1320670 Use of Weapons
Use of Weapons's picture

Point of order @ the OP.

Heroin users are actually very easy to manage, and can even have careers (hello Keith), and their habits aren't that expensive (we're not costing in the war effort to replant Afganistan, of course). The criminalisation & inflated cost / quality issues are what does them in mi'lud.


People criticise this programme but look at me. Before, I got my heroin on the street and I couldn¿t handle anything.

"Now I have money, because I only have to pay a little for my habit, I have a job as a cook and they've taken my son out of care and allowed him to live with me again. I'm reintegrated into my own life."


The Swiss have had heroin clinics for 10 years, without a massive increase in addicts. Fairly successful by all means, and # of new users has steadily decreased.


Of course, if you were to suggest that crack cocaine or meth addicts were similar to the banks, I'd agree. Hyper-sexualised speed freaks running amok for the next hit of credit? Rapidly decaying internal structures and sores that they keep picking at as they haunt the night streets, unsleeping, for that sweet mortgage? That sounds right. Heroin is waaay too passive a drug for our current abusers.

Sun, 05/29/2011 - 13:01 | 1320692 Ethics Gradient
Ethics Gradient's picture

Almost a shame we don't have drug glands really...

Sun, 05/29/2011 - 13:25 | 1320721 Use of Weapons
Use of Weapons's picture

We share similar tastes, my good GSV.


Some of the essays are fairly timid / bland, and arguable (heinous errors in essay #2, by Lisbeth Nielsen, regarding chimeras & nature, she needs to research the polio vaccines, (trans-species viruses) and think hard about what domestication actually entails), but at least it is being discussed.

The three main problems being:

#1 Not being pursued aggressively enough, compared to our Eastern friends

#2 To get acceptance, a lot of nicely-nicely fluff attached

#3 I wouldn't trust Monsanto, Beyer & co not to fuck up making a milkshake, let alone stuff like this. Bees & clothianidin? Oops? That microbe that turned plant sugar into alcohol. All plant sugars? Google klebsiella planticola.The list goes on and on.


I often forget that 50 years ago humans were still learning things about the species via live vivisection, pressure tests and infecting with nasties by hand. Not much has changed.


Sun, 05/29/2011 - 14:58 | 1320869 Biosci
Biosci's picture

And an omniscient, benevolent machine intelligence to watch over us?  How much trial-and-error before we get to that utopia?

Sun, 05/29/2011 - 15:11 | 1320894 Ethics Gradient
Ethics Gradient's picture

The omniscent bit is pretty much in place. You phone knows where you are, your ip is geolocated, your face can be identified on cctv, google and facebook know more about you than your partner, your car may have an insurance tracker and all your accounts are electronic. All you need is an app to monitor your vitals in real time and feed them back to a doctor and then stich the whole lot together.

The benevelont bit is a little bit trickier.

My benevolence, for example, would scare proponents of positive liberty.

Sun, 05/29/2011 - 16:01 | 1320981 Use of Weapons
Use of Weapons's picture

Being a Beeb documentary, fairly superficial, but it'll be interesting what the next two parts consists of, given he's right up to "...and then China screwed the USA over totally and we're all about to default" in part 1. Looks like #2 is about ecology, and the errors abounding in people's conceptions of 'self-organising networks'. Anyone whose read anything on the subject will know the problems by now (surely? complex systems theories have been around since chaos got cool, and cybernetic systems long outdated).

'Ecology for Bankers'


Note that the report was 2007 - it looks like the modeling is not working as well as intended. Or perhaps it is.


Machine intelligence?

Hmm. Hyperparasitism in software likely [already modeled & functioning; replication is via parasitism, it isn't symbiotic], physical realm largely irrelevant [fractal space - why bother with exterior, or even know it exists? Picture a human being able to effect the entire universe; we're aware of it, doesn't mean we can change it - machine <> human interactions unlikey? Other than to prevent GTNW], perfect communication has always been viewed as 'creating singularity', however - perfect encryption (or close) means private language, thus potential for individualism? [Unknown - singularity a little dated by now?].

Its been a while since I was up to date on the issues; however, the modeling going on, and faith in it to provide solutions [esp. risk management algorithms] looks dangerous. [very funky prog]

Sun, 05/29/2011 - 16:15 | 1321011 Biosci
Biosci's picture

The app to monitor your vitals in real time is currently in development by several companies within 20 miles of where I type.  The stitching together, I would argue, is a bit trickier.  The sentient, benevolent machine intelligence is the great leap...likely a lot of human control to begin with...which allows your personal "benevolence."  That's a big error to overcome in a trial.  The sort of error that precludes there ever being another trial.

Still, I enjoy Banks from time to time.

Sun, 05/29/2011 - 15:34 | 1320931 Implicit simplicit
Implicit simplicit's picture

I'd say alcohol is an a better analogy.It is legal just like obtaining debt is legal. Overdoing either consistently is terrible for you. The mass media and society push both debt and booze as good for you.

A lot of people don't like to hear it but alcohol is a a dangerous drug, and cost society much more than heroin, just like debt. 

Sun, 05/29/2011 - 12:44 | 1320674 Lord Welligton
Lord Welligton's picture

Gilmor's best defense: "It is wrong to put Ireland in the same basket as Greece."

These people are too stupid for words.

Gilmore is leader of the Labour Party (not that they do much for labour).

He said in the last week of electioneering

"It’s Frankfurt’s way or Labour’s way”

"Asked what would Labour do if the ECB in Frankfurt said no to renegotiation, Mr Gilmore argued that the rescue deal would not work and would not be able to reduce Ireland’s deficit to 3 per cent of national income. “We are confident that we can renegotiate it. I will tell you why. The current deal cannot be worked.”"

He then went into government and went tright along with the existing deal.

They might wake up one morning and find that Germany and France do have a Plan B.

It's just that it doesn't include Ireland.





Sun, 05/29/2011 - 12:45 | 1320675 Quinvarius
Quinvarius's picture

So how is this bad bank going to get the funding to buy up the bad debt?  If it doesn't pay for the debt, that is the same as the debt going to zero.  If they are getting loans to buy up the bad debt from the IMF or whatever, obviously the bad bank is meant to default on those too.

Just another bailout that screws the little people holding the existing paper money is all I see. 

Sun, 05/29/2011 - 12:50 | 1320678 BandGap
BandGap's picture

Sun, 05/29/2011 - 12:53 | 1320684 Lord Welligton
Lord Welligton's picture

"Of course since it is toxic Greek sovereign bonds we are talking about, this implies that the country will somehow be split into a "good" and "bad" version of itself."

Or maybe a Good, Bad and Ugly version of itself.

"Two can dig a lot quicker than on. Your not diggin."


Sun, 05/29/2011 - 12:54 | 1320687 Fazzie
Fazzie's picture

 When all the Keynesian inspired perversions finally blow up in their faces (well the taxpayers faces anyway) all these PHD maggots can come up with is "Gee, I know, lets set up a "good bank, bad bank!

 Good bank bad bank sounds a lot like a Dr Suess rather than a doctorate of economics idea.

 Do the ceos of the "bad bank" get mere 6 figure bonuses and second tier Ukranian escorts and stepped on coke to snort? That would seem to be fair in relative terms.

Sun, 05/29/2011 - 12:55 | 1320688 belogical
belogical's picture

Can I set up a good bad bank. How about one a year. I'll borrow say 100K a year and just keep adding banks for say 30 years at which time I'm sure I wil have passed.

Sun, 05/29/2011 - 12:59 | 1320689 Lord Welligton
Lord Welligton's picture

Gilmor's best defense: "It is wrong to put Ireland in the same basket as Greece."

Surely he meant to say.

"It is wrong to put Ireland in the same basket case as Greece."

And of course he would be right.

Ireland is a basket case all by itself.

Sun, 05/29/2011 - 13:19 | 1320723 john_connor
john_connor's picture

Let's get this party started.

Sun, 05/29/2011 - 13:37 | 1320742 disabledvet
disabledvet's picture

who's bringin' the booze!

Sun, 05/29/2011 - 13:25 | 1320728 straightershooter
straightershooter's picture

Contrary to conventional wisdom, the solution to solve Euro crisis is: Kick out both Germany and French from the Euro. Issue solved, case closed, and Euro finished.

Sun, 05/29/2011 - 13:37 | 1320741 Franken_Stein
Franken_Stein's picture


1. The country is called France.

2. Kicking out the 2 countries that started the European Community for Coal and Steel 60 years ago, which was the predecessor of the EU, is like kicking Washington out of the U.S.


No one who would dare to come up with such a plan nor would there be anyone who could enforce it.

Kicking out the main financiers and core countries of the Euro / EU is pretty nonsensical, dontchathink ?


Sun, 05/29/2011 - 14:42 | 1320840 downwiththebanks
downwiththebanks's picture

You've just described the wet dream of every Banker-Gangster parasite.

Sun, 05/29/2011 - 13:28 | 1320730 JR
JR's picture

In a blockbuster piece that puts it all together - Is Greece the Future of America? – retired Professor of Finance Michael S. Rozeff traces the causes of the world’s economic woes when the “constraint on money creation has disappeared… whengovernment no longer competes with markets for privately-produced and costly money in the form of gold and silver.”

On Greece, writes MSR: “The problem traces back to the earlier fact that for some years the government was able to borrow heavily at low interest rates. This means that it was able to sell its bonds at high prices. The problem arose because these market prices were too high.

“The sovereign debt of Greece became overvalued due to central bank/banking system money inflation. This inflation, it should be strongly emphasized, originated in the fiat dollar system of the United States and the Federal Reserve.

“The central banks of the world and the world money supply are heavily influenced by what the Federal Reserve does through a kind of multiplier effect, because foreign central banks respond to Fed inflation with inflation of their own. Ronald I. McKinnon explained this important process in his June 1982 article in the American Economic Review. We see it happening today when foreign banks have to inflate in reaction to QE2 in order to prevent their currencies from strengthening too much against the depreciating dollar.

“The high bond prices encouraged the Greek government to borrow too heavily and to raise government spending. But since its spending was not productive, it didn’t produce high enough tax revenues to service the debt. In time the government faced the problem it now has, which is not enough tax cash flows or income to service the debt.

“Monetary inflation, in other words, causes overvalued sovereign debt. This sets in motion larger government spending, higher debt loads, and an eventual fiscal crisis when tax revenues fall short of what is required to maintain government spending and service the debt.

“This process goes on in addition to the business cycle effects, well-known in Austrian economics, that inflation produces. In keeping with the analogous finance literature on overvalued equity, I identify this process as one that involves agency costs of overvalued sovereign debt.

“This process is only made worse when major lenders, such as large banks, have reason to believe that they occupy a privileged position and that their bond positions will be paid off by political means if necessary. These lenders then all the more become willing to buy overvalued sovereign debt.

“This effect of inflation is important because of its broad applicability in an age of inflation. In particular, a number of other countries including the U.S. have followed the Greek path.”

Sun, 05/29/2011 - 13:56 | 1320761 Use of Weapons
Use of Weapons's picture

But since its spending was not productive, it didn’t produce high enough tax revenues to service the debt

I think everyone, by now, realises that the Greek problem had its roots in no-one (businesses, people, local government, barring, ironically, some of the Corporate banks) paying any taxes. i.e. The Greek government was corrupt enough not to care (as they were on the take) and not hypocritical enough to enforce tax evasion (or their legal system was too (in)efficient - take your pick). Oh, and creative accounting, but come on:

The only real argument is over whether people copying the actions of multinationals / the rich (Cayman isle style) was predictable. I'd say it was obvious - and looking at US politicians' 9% take on deals [ty ZH for that excellent ammunition] it'll be coming to the USA soon. Corruption, unlike wealth, really does have a trickle down effect. And why should anyone play by the rules, if the rules are so obviously flouted?

"Waaa, I don't want to pay Corporate taxes, I can go live in China" (looking at you, HSBC) - problem is, what happens when your employees & everyone else ceases to pay taxes?


Oh. Wait. Not paying your mortgage?

The IRS confirmed to Reuters that the review comes in response to mounting evidence that banks violated tax requirements by mishandling the transfer of mortgages to REMICs, short for Real Estate Mortgage Conduits.

Should the IRS find reason to take tough action, the financial impact could be enormous. REMIC investments are held by pension funds, in individual retirement plans such as 401(k)s and by state and local government entities.

As of the end of 2010, investments in REMICs totaled more than $3 trillion, according to data supplied by the Securities Industry and Financial Markets Association.


Will the US gov. decide that taxes > industry chaos & collapse? Hedging my bets that it won't get answered until after the election, but you never know. I know little about the mortgage industry, so I'd look to someone a lot more competent to tell me the implications of the IRS <> Banks fighting over this one.

Sun, 05/29/2011 - 15:24 | 1320916 JR
JR's picture

It is the eighth commandment: Thou shalt not steal. And this exactly identifies the sin brought against the American people and the peoples of the world by the Federal Reserve using the “special tool” of its chairmen:

 The U.S. government has a technology, called a printing press (or today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at no cost." – Benjamin Bernanke

The cost to America has been the expansion of a socialistic economic system whereby fewer than half the population - fewer all the time - are forced to support the remainder.

The roots of Greece’s crisis go back to the strong euro and rock-bottom interest rates that prevailed for much of the past decade, i.e., the Fed doing God’s work.

Says the NYTimes: “Greece took advantage of this easy money to drive up borrowing by the country's consumers and its government, which built up $400 billion in debt. When the global economy crumpled, those chickens came home to roost.”

Socialism does not work, although that fact continues to evade US President B. Obama and George A. Papandreou, scion of a Socialist dynasty whose father helped erect the sprawling Greek welfare state when he was prime minister in the 1980s.

In Greece, “where one out of three people is employed in the civil service, which until now has guaranteed jobs for life,” according to the NYTimes, socialism - as well as fascism -  has become unsustainable as it is becoming unsustainable in the US.

Sun, 05/29/2011 - 13:42 | 1320744 disabledvet
disabledvet's picture

time to send in a "smashing young man?"

Sun, 05/29/2011 - 13:45 | 1320755 Rodent Freikorps
Rodent Freikorps's picture

The wolves are catching up. Gotta throw the weak off the sled to slow the pack down.

Sun, 05/29/2011 - 13:54 | 1320765 mt paul
mt paul's picture

made me laugh ..

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