This page has been archived and commenting is disabled.
Greece Yields Surge As Vigilantes Call Greek/EU/IMF Bluff, Stocks Drop
As we expected last night, G-Pap's latest round of commentary was certain to set off fireworks in today's bond arena. Sure enough, at last check the 10 Year spread to Bunds had blown out by 40 bps to almost 400 bps, this is approaching the record wides seen during the duration of the entire crisis. As usual, the collateral damage is a drop in the ASE which was about 2% lower for the day, as well as Greek banks, mostly in the red. The primary source for the weakness was Moody's (which is now about 4 notches behind Fitch) statement that "there is a 50% chance that Greece's credit rating
could receive another downgrade in the next 12 to 18 months if fiscal
consolidation falls short of goals. If Athens falls short of
perfection, the Greek rating will be downgraded, a Moody's spokesman
said" as reported by the WSJ. Additionally, a new round of strike is once again paralyzing the country. And confirming our observations that the half-life of any good news out of Greece is now less than 24 hours is Brown Brothers Harriman, which sent out a note to clients saying: "The afterglow of yesterday's Greek T-bill auction has faded." Lastly, CDS are back over 400 bps. The "speculators" are closing in on the kill... or at least the formal announcement of the bailout mechanism's activation by G-Pap. The loaded fire extinguisher is about to become a loaded gun, to be used shortly in a fatal game of Greek roulette (Russian roulette variation, where all the chambers are loaded).
»
- 4286 reads
- Printer-friendly version
- Send to friend
- advertisements -
And in to the far turn it is No - We Will See At Least Another Week Of ECB Incompetence in the lead, followed by CA/PA/NY Will Be Bailed Out First. Looks like Yes - US Taxpayers Will Finally Get Their First Bailout Recipient For 2010 has quit the race after stumbling at the gate.
As Mike Vronsky said in The Deer Hunter, the only solution is to get more bullets in the chamber.
Wonder if G-Pap will "squeal like a PIIG"?
I believe you have confused the movie "The Deer Hunter" with "Deliverance" (Ned Beaty gets raped by the appalachian rednecks), but I still thought your comment was clever
Well aware they are very different movies. Just thought one movie reference deserved another. Had thought about trying to superimpose G-Pap's head on the underwear-clad Beatty, but I'm lousy with editing images.
Well, this americano "in vacanze" in Italy ain't seen squat about any stinkin' crisis!
Of course I am working my way through a 0.66 liter bottle of Peroni, and have not made it ove to see how the Euro is doing (changed money yesterday).
Cannot do anything over here other than watch the show!
On vacation in Italy and still obsessively reading ZH? You, my friend, are an addict.
"there is a 50% chance that Greece's credit rating could receive another downgrade in the next 12 to 18 months if fiscal consolidation falls short of goals"
What kind of a ridiculous statement is that for a ratings agency to make. I didn't realize their ratings had anything to do with 'chance'.
Not to mention that 50-50 means nothing, they don't have any confidence in their "forecast". You can't sue them if you lose money based on the negative bias because the other 50% equally means it could stay the same or even go up...
What will I do when, one day, I can't come to ZH and watch the Greek implosion in real time because it's over? Oh yeah, we are going to have it here too. Never mind.
Don't like repeating meself but as said doesn't matter how mush you insist,kick,push and beat down yr foot greece is not going to default.
start looking for other victims.
also got u some news fm grk finance minister who said this morning, "doesn't matter if one country (meaning germany) don't want participate in the rescue plan , we'll continue. " (bankingnews.gr)
Ustand him, germany too busy undergoing full scale seminars "how to corrupt goverments without tracing"
Hi Leo.
It's not like it has much of a choice, on a long enough timeline. Like a year or two. ;-)
Why quote him save for comic relief? The man is either dumb or delirious.
why is default now such a dirty word
why is noone allowed to do it
companies and countries have defaulted throughout history and the world did not end so why is it not allowed now
but rest assured if they do not allow the debts to clear with bailout through bailout, the world will end
"why is default now such a dirty word"
Because the illusion requires confidence in order to maintain itself. Think of confidence as the surface tension that keeps a bubble formed and thus inflated. It forms the barrier between the reality on the outside and all those who wish to remain separated from reality on the inside.
It requires confidence to maintain this separation. The confidence isn't based in reality either, just in an illusion sturdy enough (like the bubble's surface tension) to hold itself together. The confidence acts similar to a strong nuclear force or a magnetic field holding everything together. Once the veil of confidence is punctured, once the magnetic field is disrupted, once the surface tension is broken at any point, it rapidly collapses, just as the bubble explodes.
Poof. Gone in an instant.
Exactly right. That's why the current plan, for every central bank to print-and-swap-with-peers is merely an attempt to devalue (default without the taxpayers noticing).
Default is essential, and inevitable. There's a reason we don't have "debtor's prisons" anymore.
For now we don't have debtor's prisons..................
They've been renamed concentration er...ah...excuse me, resettlement camps.
Rates need to rise, asset prices need to fall, sovereigns need to fail, this is nature of the debt cycle . the Greeks are further along the recovery process, they just don't know it yet.
ignorant
maybe that is a relevant name
a Bailout is illegal
how many times does this need to be said
lawyers will have a field day and there WILL be riots by european taxpayers
thats why there has not been a bailout so far
yabs ?
probably u know bttr and all those EEC clowns don't know wht they say and sign.
question, why only anglo-saxon hyenas screaming for default while all downpaymnts are paid by greece in time ?
do they mind for greece welfare or they think we are so naive to let them get in here and loot.
Us Tsy's are selling off, QE ending, Zirp ? Unwind of risk trades.?
Schumer on now Protectionism on the way.. .this lines up with the debt cycle, protectionism and tariffs. Its a political reaction to lack of demand.
While I understand the long term effect of a bailout will be nothing more than a kick of the can down the road, but with 5yr CDS at 430bps, and the floor of 300bps that the EU/IMF package of support will provide, what am i missing? My assumption is that Greece will indeed ask for the help in the near future (perhaps when their U.S. deal roadshow is not attended). But in that instance, why would you not be a protection seller at 430?
Legal threat, ambiguity cloud Greek aid deal
http://www.reuters.com/article/idUSTRE63D10N20100414
i believe the risk-reward of holding greek bonds is skewed to the downside by the continued talk of bailouts and guarantee's by imf and ecu.
yet another distortion in the markets.
Here comes portugal:
EU commission told Portugal this afternoon to watch their budget.
Source: FD.NL
Speaks volumes on how inept European policians have become. The speculators have them by the balls. Pathetic, truly pathetic. If the ECB were half as corrupt as the Fed, they'd stick it to the speculators!
"If the ECB were half as corrupt as the Fed, they'd stick it to the speculators!"
You must be referring to that subset of uneducated speculators who haven't cut the politicos in on the action, errr, donated.
"The 'speculators have them by..."
I think you mean the investors have them cornered. 'Speculators' is so Inside-the-Beltway.
The investors having to get paid back, in the face of no more naive investors to provide cheap cash to buy the greasy, re-fi trash is the driver of all this.
yeah right blame the speculators for a country spending way more than it
earns
And the USA, via their share of payment into the IMF, along with China, Japan, Germany, Netherlands, France, Switzerland etc. . . will be bailing out Greece, and soon Spain, Portugal, and on and on.
Who/what will bail us out when the IMF can't "raise" any more money.
Here's the IMF's latest call for more crisis currency http://bit.ly/9NQ0nu