Greece Proceeds To Make Bond Shorting Impossible

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Thu, 04/08/2010 - 16:04 | 291997 truont
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Notice how governments, which claim to act in the public good, actually only act for their own good.

In desperation, a government will do anything to the public (who appointed the government) to survive and continue its existence.

Thu, 04/08/2010 - 16:30 | 292066 mikla
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This really isn't hard to understand.  There are many theories on the structure and behavior of bureaucracies, but they all conclude:

A bureaucracy's first job is to feed itself.

After that, sometimes they go about their mission.  Quite often, however, all incentives is for them to undermine their mission (to actively work against their mission).

Governments have no incentives to serve their people, but rather, have all incentives to grow and protect themselves *from* the people they rule.

Thu, 04/08/2010 - 15:59 | 292005 ZackAttack
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C'mon, this is a skirmish in the battle to shape western civilization. I'd be disappointed if there wasn't a helluva fight.

Thu, 04/08/2010 - 16:05 | 292017 What_Me_Worry
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Step 2- Prohibit selling

Thu, 04/08/2010 - 16:44 | 292082 jimcg
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Step 3: Mandatory buying.

Thu, 04/08/2010 - 16:51 | 292098 Missing_Link
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Step 4: Mandatory buying on margin, to be funded by future generations.

Oh, wait.  Here in the US, the Federal Reserve is already doing that for us.

Thu, 04/08/2010 - 18:10 | 292183 GoldmanSux
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Step 6: Default.

Thu, 04/08/2010 - 18:04 | 292185 three chord sloth
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Step 5: Require all retirement accounts to be "x" percent in Greek bonds... "x" starting at 50, ending at 100.

Thu, 04/08/2010 - 22:21 | 292504 FischerBlack
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Step 7 Collect Underpants

Step 8

Step 9 Profit

Thu, 04/08/2010 - 23:31 | 292590 perchprism
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What the hell??!   Honey, I just saw a gnome in my underpants drawer!!



Fri, 04/09/2010 - 07:20 | 292865 MarketTruth
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>>Step 3: Mandatory buying.<<


Isn't the USA going to do this to all their citizens via their 401k account. Hmm....

Thu, 04/08/2010 - 16:09 | 292023 Marc45
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Off with their heads!  (Greek govt to short sellers)

Thu, 04/08/2010 - 16:10 | 292026 rich_maverick
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Unfortunately, doing this in a time of panic only results in the opposite behavior.  Why would anyone put new money into an investment by which they are imposing controls on liquidity.  Today, they restrict the short sellers, next, they will restrict redemptions and force rollovers of existing debt.  It's unfortunately inevitable.  This is something that should have been done way earlier.  Now, it just looks like desperation and will get the opposite reaction.


Thu, 04/08/2010 - 16:22 | 292052 Bruce Krasting
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What's worse than a short squeeze that doesn't work?


Thu, 04/08/2010 - 16:29 | 292058 jdrose1985
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Obviously "they" seek to fail under the evil guise of protecting the system heh ya know whatta mean

Thu, 04/08/2010 - 16:32 | 292069 Leo Kolivakis
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Damn those Greeks are so stupid! How many of them have graduated from Harvard, MIT, Yale, Princeton, LSE,  and they can't figure out how to ward off the big bad speculators? Shit, maybe Aristotle and Plato weren't Greek after all. SIGH!!!!!!!!!!!!!!!!!!!

Thu, 04/08/2010 - 17:56 | 292171 nonclaim
nonclaim's picture

Yeah and when (not if) Greece falls into the IMF hands or defaults you'll say: OMG!! That was totally unexpected! Nobody saw it coming! CNBS never mentioned it!

Come on, cut the crap...

Thu, 04/08/2010 - 16:35 | 292071 SgtShaftoe
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When do yall think this is going to start speeding up, if at all?  It's taking much longer than I thought for the dominos to fall.  I'm afraid that if it goes down too slow (a decade), those of us who have hedged a defense won't have jobs or a pot to piss in by the time it makes any difference.

Thu, 04/08/2010 - 16:52 | 292097 rich_maverick
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Dude...  the speed at which dominoes fall is at first very, very slow.  Things take years, then months, the suddenly, everything goes to hell overnight.  Just look at the Lehman debacle, the high of the DOW happened 1 years earlier, 3 months later, the market took a kick in the pants, but recovered some until Bears was "rescued".  Then, the government started with "banning shorting of financials".  Finally, Lehman, AIG, and the market fell off a cliff...  Took 1 year to play out.  But, it was Lehman that was the tipping point.  When that happened, everything fell apart.

For the next debacle, who knows what the trigger point will be.  It could be Greece, leading to Spain going through the same crap.  It could be California.  Heck, it could be Israel attacking Iran or something like that.  Point is that we have water boiling in a pot, with no way to release the pressure slowly.  At some point, it will all blow.  Just have no clue when that will happen.  Worse, I have no clue how the endgame will play itself out.



Thu, 04/08/2010 - 18:28 | 292207 three chord sloth
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That's just what Hemingway said. He had money trouble, and was asked how one goes broke. "Slowly, then all at once."

Thu, 04/08/2010 - 16:43 | 292081 ZackAttack
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One man's speculator is another's bond vigilante.

Thu, 04/08/2010 - 16:56 | 292104 Mae Kadoodie
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Ooooopa.  Let us bond, Greek style:

Thu, 04/08/2010 - 17:09 | 292122 BlackBeard
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puahahahahha no bid.

Thu, 04/08/2010 - 17:24 | 292138 carbonmutant
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 One of the major problems with taking a risk on Greek Bonds is that you have no idea what these Athenian Ivy League grads are going to do next.

Thu, 04/08/2010 - 20:41 | 292388 Augustus
Augustus's picture

This seems to be a pretty important update. Well worth the read as it lays out the repos and amounts the ECB has already taken in. The ECB is still allowing them at par value with only a very small haircut. What is that 4% bond worth in the new 8% market? The countries just finished throwing money to prop up their won banks. Now the ECB will be full of the trash and they are finishing it too.

Bundesbank attacks Greek rescue as a threat to stability
Germany's Bundesbank has fired a warning shot at Chancellor Angela Merkel, attacking the joint EU-IMF rescue plan for Greece as a threat to economic stability and probably illegal.

By Ambrose Evans-Pritchard
Published: 10:44PM BST 08 Apr 2010

Thu, 04/08/2010 - 21:33 | 292450 Buck Johnson
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They are making more likely that they will default and/or call the IMF for help.  You know they keep saying that EU will fund the Greeks yada yada yada, but if thats the case why hasn't the money started to flow.  It's because as I stated before the lion share of that money is coming from Germany and they and their people don't like it.  I read that article you posted Augustus and Greece bonds shot up this week to 8.3 percent from 5.2 last week and the only reason it went down from the top is because Greece made statements of cutting budget deficit by 40 percent.  You know what does that truly mean, to me it looks like Greece saw the gates of default before the week was out and decided to make any statement to stop the slide.  The problem is that anyone with an IQ over mud knows that Greece or any country won't be able to cut their budget like that to almost half without major political and social upheaval.  The got so panicked that they said anything to stop the slide.


Greece isn't getting the money, because if they where they would have had it by now or a more detailed plan of the bailout.  And there's none.  Merkel knows that her opposition and her own govt. officials smell blood in the water.  They know this is a bad idea and buy letting them go is the best option.

Thu, 04/08/2010 - 22:30 | 292516 Augustus
Augustus's picture

It is not a 40% budget cut.  It is deficit reduction of 40%.  Reduce deficit from ~12.5% to ~8% of GDP.  They will still be increasing debt, with increasing interest rates applied to rising balance.

Thu, 04/08/2010 - 21:46 | 292463 jimcg
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Whichever method "they" decide, the Greek "Games" must go on.

The Rothchilds demand payment, one way, or another.


Fri, 04/09/2010 - 05:20 | 292824 nathan1234
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Dont forget to ban the swaps too


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