Ferocity Of Imminent Spain-Germany Cold War Will Only Be Second To Upcoming Fox Biz-CNBC No Holds Barred

Tyler Durden's picture

One of the more ominous news of the day came from Reuters, which reported that the previously disclosed rumor that Spain was seeking a €250 billion bail out package, had in fact originated from high-placed German officials. The move, which will could easily set off an intraeuropean cold war, was prompted by the increasing schism between Europe's (so far) solvent core and the insolvent Club Med, and was intended "for Spain to take tougher austerity measures to cut its huge budget deficit." Instead, the tsunami of denial that resulted, only exacerbated matters and made it seems like Spain is truly on the brink. Compounding this animosity, was the disclosure that Spain's direct counterattack took the form of the El Pais story that "quoted Spanish government officials as saying Madrid wanted to publish the results of stress tests being conducted on its banks to reassure markets" a move which has been opposed by Germany and especially by Austria, which believes that publishing the true deplorable state of affairs of its Erste and Raiffeisen Bank would cause yet another bank run. At the end of the day, none of this helped either unlock Spain's frozen interbank or money markets, or encourage a sense of credibility in the euro (turns out that was only courtesy of the biggest short squeeze in Euro history). In fact, if such political low blows are to be expected, it is only a matter of time before all investors completely desert Europe and let it deal with its escalating vendettas on its own. Yet all of this pales in comparison with the very sweaty locker room war that was just unleashed by Fox Business' Charlie Gasparino against CNBC, and particularly its early morning anchor, Joe Kernen.

More on Cold War for Gen K(eynesian unwind) from Reuters:

European diplomats say the background to the leaks and counter-leaks lies in pressure from Germany -- Europe's economic powerhouse and main paymaster -- for Spain to take tougher austerity measures to cut its huge budget deficit.

The Germans seem to have fired the first shot, telling journalists in Berlin on condition of anonymity on June 7 -- the day the German coalition agreed on its own austerity package -- that Spain was on the brink of seeking a European Union bailout.

Diplomats said Spanish Prime Minister Jose Luis Rodriguez Zapatero was furious and demanded to know in Berlin and Brussels where the reports were coming from.

The counter-attack began on Tuesday, when El Pais newspaper quoted Spanish government officials as saying Madrid wanted to publish the results of stress tests being conducted on its banks to reassure markets -- a move hitherto opposed by Germany.

"If the results of the tests were known there would be more than one surprise," one of the sources was quoted as saying, noting that Spanish banks had performed well.

The next day, the Bank of Spain said it would soon issue unilaterally the results of tests of capital adequacy and risk resilience being conducted on Spanish banks.

That forced the hand of EU leaders, meeting in Brussels on Thursday, who decided at Zapatero's initiative, with the support of the European Commission, to make bank-by-bank results public on the top 25 banks by the end of July.

If you are not afraied yet, you should be. Very.

EU officials, reluctant to speak on the record about the dispute, said the European Commission was flabbergasted by the leaks, which were damaging the euro zone.

"We simply cannot understand how this can be in Germany's interest, or anyone's interest in the euro area," an official involved in crisis management said.

This is the kind of "accord" that is permeating Europe right about now: what initially was just a war of words between Germany and France, has escalated into a war of actionable attrition, as the German rumor most certainly had a very adverse impact on Spanish bond spread. The simple conclusion is that Germany is now actively trying to scuttle the European rescue, and will not stop before the euro plunges, or goes extinct. It is certain that this media circus will only get worse, although it will wipe out Spain first, before it comes around and test just how stable those sub 3% Bunds really are.

However, while far less geopolitically relevant, a far more entertaining debacle, will be the now open war between Fox Business and CNBC.

Earlier, while reporting on what the alleged "true" form of BP's financing package will be, Charlie went to town on CNBC's Joe Kernen, who said Fox Biz is a "bunch of wingnuts", regaling his viewers and Liz Claman with an episode straight out of Midnight RunExpress: "I used to play this little game with [Kernen] in the locker room after we worked out, and he had visages of a prison scene... I used to walk around him and talk to him, and he used to sweat after taking a shower, he saw my tattoo, my hairy chest."...we just need Kneale to chime in about digital dickweeds and the grotesque would be complete.

Another amusing thing we learn is that according to Gasparino, should BP go ahead and do a Reg-S/144A bond offering with a full prospectus, he "would have 5 days worth of stories, it would be amazing. I am gonna kill them on the prospectus." Alternatively, the story goes, a loan document, which has a far more narrow scope, would be able to avoid the type of SEC-mandated disclosure that accompanies bond reds. Of course, none of this is even remotely relevant: BP's balance sheet at this point is very much irrelevant, and the entire fate of the company lies in whether the batting of a butterfly's wings in China will create a hurricane in the GoM in the next month. Should this happen it is game over for the firm. Which makes us wonder - just how do those who pitch long BP positions hedge for what is basically a binary outcome, in which the downside climatic and otherwise variables can only be controlled by god's proxy on earth, Goldman Sachs (especially since GS just issued a cautiously optimistic outlook on BP, which if the success of the firm's EURUSD calls are any indication, means the end is near).

Either way, we can't wait for Kernen's response, and for the dirt on Chaz to finally start flowing from CNBC's female anchor population, who are now prohibited by FCC rules from further lowering/shortening their necklines/hemlines, without garnering an NC-17 rating for GE's propaganda channel, and thus will do anything else to generate some incremental viewership for the ratings troubled station.

Check out the clip below:


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Akrunner907's picture

Damn she is top heavy.........love the profile view....

faustian bargain's picture

I watched it without sound...her body language is rather suggestive.

SilverIsKing's picture

I'm surprised CNBC let her go.  She still has some mileage left in her.

arnoldsimage's picture

i'm sure she will appreciate your comment.

anony's picture

Can you post an image file source where we can actually see a blow up of your avatar?



aint no fortunate son's picture

Watch it there... you're talking about one of Buffett's favorite little foxes.

AssFire's picture

I am a tit guy, but jenna lee still has her beat.

UncleFurker's picture


I figured that out already from the avatar.

Turd Ferguson's picture

I've always thought that Kernen was a tool.

He tried to be a financial advisor in the 80s. Couldn't cut it. Got fired by Merrill.

He's had a bug up his ass for advisors and brokerages ever since.


bbbilly1326's picture


Congrats ZH, this is BY FAR the best scandalous video I"ve seen here.........


Kernan is the absolute worst on CNBC (now that other idiot is gone, and I've never watched Cramer as he's unbearable).......Kernan can barely put a 5 word sentence together that makes  sense.


And to have Gasparino dis him ON NATIONWIDE TV with undercover locker room sex talk----PRICELESS  !!


If I still had cable I might be tempted to watch Fox.......(lead me not into....)

Careless Whisper's picture

no way bb. gasparino is an effin' idiot. a tool. kernan is totally underestimated. he has a masters from m.i.t. so don't be fooled by his demeaner. gasparino made sure to tell us that he has a hairy chest and a tattoo -- a manly man. the only thing he left out was that kernan has a small c0ck. this guy is a 'journalist'? puuuhleeeze.




RottingDollar's picture

I find amusing the debate who is the bigger tool Kernan or Gasparino---when they both huge tools.   The irony is that Kernan was being sarcastic about the wing nute comment.   He's constantly being emailed that he's the wing nut of CNBC so calling Fox Business wing nuts was an inside joke to his distractors.   

Bottomline both are tools.


blindfaith's picture

stopped watching these snot idiots 7 years ago.  Kernen wouldn't even make a decent door man at an NY hotel, disherwasher maybe but even there you have to show respect and he has no clue.

Turn them off, you watchers are why they exist.

Treeplanter's picture

I turn the sound off.  Then listen if Rick Santelli or the Commodities Lady is on, she likes her gold.  No need for the Wall Street cheerleader squad.  

FEDbuster's picture

Russian Television (RT) should start an Internet based financial news channel with Rick Santelli at the helm.  They could have a weekly show called "Got Gold?" or "Gold Bitches!" with Gordon Gekko as host.

Basia's picture

Financial porn. Testosterone overdose clouds the brain and is fatal to your bottom line. Watch at your peril.

Reflexivity's picture

Is zerohedge not the Porn King of the financial porn genre?

TuesdayBen's picture

Naw.  ZH isn't a sexy Buy Buy Buy.

It is an interactive Think Think Think,  Learn Learn Learn.

dnarby's picture

In the financial porn world ZH is a course in advanced genetic engineering to create the ÜberKapitalanlege.

CPL's picture

As far as the world is concerned we are the 4chan.org/b/ channel of financial news.


It hits us first without filters, we cuss, swear (without the interesting pictographic display and CP) then the filter continues to bored news feeds that look to the comment section for clear definition on the issues....including the words like "fuck", "cuntard", "cock swallower", "assmaster", etc.

Pretending we aren't even in the ring is the correct thing to do.  The fight was never in the legislated, law abiding, kangaroo court of ring side.  It out where the rest of us are.  Street level, no rounds, no time is kept and with full understanding of how most of the world is fought in a ditch than in three piece suits.


//rant off...amen.

Treeplanter's picture

I read Abu Baba Sri Sri Zeroji cause I can't understand two thirds of what our guru is talking about.  A sure sign he's smart, in with the in crowd, and knows what the in crowd knows.

Assetman's picture

What we really need is an ultra high stakes World Cup football match between Spain and Germany.

The bet would go something like this-- if the Spaniards win, Germany funds the full 800 billion euro bailout package.

If Germany wins?  They own Spain.  And will get the option of shipping the 20% or so unemployed to Montana.  Don't worry, Barry O will put them on a new brand of hopey/changey socialism.

And if there's a tie?  They'll be no tie!  Why do they even let these teams do that, anyway?

if's picture

Have you been to southern Spain lately ?  German is a very common second language and if not that most of the other foreigners speak some variant of broken English it would probably be the dominant second language.

Hephasteus's picture

Spain already screwed up thailand. Gave those poor cute asians big giant spanish horse teeth. They should let the spanish ride thai's and use a polo club during the match.

Treeplanter's picture

Exactly why did Carthage, Rome, and the Arabs want Spain?  Is there any tin, gold or something else of value still there?  

Hammurabi's picture

Since Decembre the media trying to creat bad news about EU and make the EU leaders fight each others, the bigest winer sow far is the US bonds,

Augustus's picture

What we are seeing euro land is soon to be here.

The big Spanish banks are probably in better condition than the others, with the proviso that they all have problems.  They are now arguing about which has the least infective disease.  The decision to not evaluate the effect of sovereign debt on the balance sheets has greater benefits for the most leveraged institutions as they all have problems.  The Germans have the leverage several times greater on that score, IIRC.  They are also getting screwed on the ECB buying of the sovereign bonds as it does nothing to benefit the German citizen because it devalues the euro.  The German banks evidently held the Greek bonds while the French banks cleared them out.  None of the net borrowers wants to cough up the payments for their past feasts.

How does it play out in the US?  At some point the monsterous state debts of several states will generate a buyers strike - Greek bonds.  When the Fed has to become the buyers - ECB - the differnet states will want to argue about it and which was the most wasteful in the past or failing to pay their way to solvency.  Everyone will offer the excuse that they are good for it given more time to cure.  Except that they cannot exist without increasing debt amounts. 

There will be a great number of people who will learn how to pluck their own chickens and skin squirrel.



Jendrzejczyk's picture

"There will be a great number of people who will learn how to pluck their own chickens and skin squirrel."

Nominated for the line of the month.

Squirrel=good eatin'!

keepmydollar's picture

As someone here in the southwest who has hunted and eaten squirrel.  It is good eatin'.


That said this short squeeze on the Euro last week is allowing me to buy a steer and slaugher it.  Steak for 6 more months.

Bendromeda Strain's picture

I dunno, rabbit seems so much easier. And besides, bunnies are a steady meal ticket...


Jendrzejczyk's picture

I'm a wimp, gonna have to go vegetarian when I can't get my meat wrapped in pretty plastic.

Rusty_Shackleford's picture

Squirrels will soon be known as "Depression Sandwiches"

Sqworl's picture

Hey Hey Hey...watch my friend...:-)

Rusty_Shackleford's picture

Present company excluded, of course.

glenlloyd's picture

ah, let me get out my carrion cookbook!

Printfaster's picture

Only two pieces of carrion allowed per person.  Government rules.

grunion's picture

...with a side of Hoover hog...

FEDbuster's picture

I though they were refered to as "Tree Rats" in some circles.  I have ate squirrel, tastes like tough chicken dark meat.  In a soup or stew they would be easier to eat.

fajensen's picture

Germany is now actively trying to scuttle the European rescue, ...

The popular feeling in Europe is that the EU needs taking down several notches. The EU commision has used the crisis to grab even more power for itself - now the kommisars wants to approve member states national budgets over the heads of elected governments; A vastly unpopular move and guranteed to bring in right-wing nationalists everywhere.

Any politician with an ounce of ambition will have to sabotage the EU's "resue" efforts before they either remove their influence or get them kicked out in the election. The surprise to the EU is that the leak probably comes from someone high, close to Merkel.

Snidley Whipsnae's picture

Someone posted here (a rumor?) that Germany has held secret meetings with Russia about creating a common currency. Anyone have a link to the rumor? Or, is it bs?...Thanks...

Treeplanter's picture

The Germans are smarter than that.  I once had a neighbor who started treeplanting contracting at the same time I did.  He wanted to be partners.  Since I had seen him lie to his wife about small potatoes I knew he would lie to me, so no go.  Later he was working near my camp in the BC Rockies.  The provincial forester complained to him that his crew seemed to be drunk a lot on site and it was causing quality problems.  He assured the guy he had laid down the law on that, "No drinking before noon, no LSD on the block."  Russia would make that kind of partner.