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With Greek Bonds In Freefall, ECB Intervention Absence Raises Concerns Greece Is Now Doomed

Tyler Durden's picture


It seems that the ECB has now resigned to letting Greece fail. While previously any time we had a whopping 2 point drop in one day the ECB would promptly step in and be the buyer of only recourse in peripheral debt, it has been deathly silent today. And as the chart below demonstrates Greek debt is about to go bidless: a par 10 Year note is trading at 62, with the resulting yield now literally going parabolic. And the 2 Year is now at 16.5%. Luckily for a globalized economy, dominoes are completely isolated and what now appears to be a certain "chain reaction" in creditor defaults will have no impact on the Russell 2000: after all the Fed is surely prepared for this contingency.



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Fri, 04/15/2011 - 09:38 | 1172070 tmosley
tmosley's picture


Fri, 04/15/2011 - 09:41 | 1172076 becky quick and...
becky quick and her beautiful mouth's picture


Fri, 04/15/2011 - 09:43 | 1172097 knukles
knukles's picture

I thought that Becky always said "duh" before "awesome"?

Fri, 04/15/2011 - 10:04 | 1172189 Mercury
Mercury's picture

I swear I heard her say this morning "...and apparently gold has been coming back recently..."  as if she were talking about something completely trivial like the price of Hannah Montana tickets or something.

Fri, 04/15/2011 - 10:23 | 1172262 Thomas
Thomas's picture

Totally awesome (and would you marry me, Becky?)

Fri, 04/15/2011 - 09:40 | 1172081 Long-John-Silver
Long-John-Silver's picture

Why is the RFID chip in my palm flashing?

Fri, 04/15/2011 - 09:47 | 1172106 flacon
flacon's picture

It's telling you that you son-of-a-bitch haven't spent enough money this month - you damn "saver"! The only way to get rich is to spend more than you have and you have earned - don't-cha-know! /sarc

Fri, 04/15/2011 - 09:55 | 1172145 Chuck Walla
Chuck Walla's picture

Buy more gyros! Or is that Euros?

Fri, 04/15/2011 - 12:07 | 1172757 e_goldstein
e_goldstein's picture

At least you can eat gyros ;-)

Fri, 04/15/2011 - 09:58 | 1172168 Cthonic
Cthonic's picture

Report to the nearest Sleepshop, Logan Three.

Fri, 04/15/2011 - 10:24 | 1172267 Thomas
Thomas's picture

It's telling you that you've used up your monthly allocation of chickens to choke.

Fri, 04/15/2011 - 16:09 | 1173863 BlackholeDivestment
BlackholeDivestment's picture that was funny.

Fri, 04/15/2011 - 09:44 | 1172095 CPL
CPL's picture

You are not of the body!  Traitors!

Fri, 04/15/2011 - 09:47 | 1172112 LawsofPhysics
LawsofPhysics's picture

Well, that dates you tom.  How long till U.S. bonds do the same thing?

Fri, 04/15/2011 - 10:06 | 1172200 tmosley
tmosley's picture

Never.  The dollar goes first.

If the Treasury market goes tits up, we might get a "renew" rather than a thermonuclear detonation.  But the Fed can't resist interfering, and in fact is forced to interfere under any and all circumstances.

Fri, 04/15/2011 - 10:22 | 1172255 LawsofPhysics
LawsofPhysics's picture

Sweet, so I can love my metals AND bonds for a bit longer.

Fri, 04/15/2011 - 10:33 | 1172316 RockyRacoon
RockyRacoon's picture

Greece gets access to the Fed's discount window -- problem solved.

I've always wanted to visit/own a sun-drenched Greek island...

Fri, 04/15/2011 - 10:34 | 1172313 redguard
redguard's picture

RUNNER! Drop the gold and silver.

Fri, 04/15/2011 - 10:37 | 1172336 redguard
redguard's picture

RUNNER! Drop the gold and silver.

Fri, 04/15/2011 - 10:50 | 1172396 PY-129-20
PY-129-20's picture
Fri, 04/15/2011 - 09:38 | 1172071 PolishHammer
PolishHammer's picture

100% contained.

Fri, 04/15/2011 - 09:56 | 1172159 redpill
redpill's picture

And not a threat to human health (Copyright 2011, TEPCO)

Fri, 04/15/2011 - 09:36 | 1172072 pan-the-ist
pan-the-ist's picture

Reality might sink in?

Fri, 04/15/2011 - 09:39 | 1172078 traderjoe
traderjoe's picture

But, but Leo said to buy - back at 8% on the 10-year?!

Fri, 04/15/2011 - 09:44 | 1172105 Dick Darlington
Dick Darlington's picture

Maybe he wanted to get in early to max out the haircut... Some like pain, ya know ;-)

Fri, 04/15/2011 - 10:19 | 1172252 Crisismode
Crisismode's picture

No, he traded them for the chinese solars.

Fri, 04/15/2011 - 10:43 | 1172368 CPL
CPL's picture

Which are getting caught with their pants down in scams like channel stuffing or outright lying on their books.

Fri, 04/15/2011 - 09:40 | 1172079 emsolý
emsolý's picture

Let's play dominoes!

Fri, 04/15/2011 - 09:46 | 1172103 aVian
aVian's picture

make that DOOMinoes  

Fri, 04/15/2011 - 09:43 | 1172087 HamyWanger
HamyWanger's picture

Please Tyler, I can't take any more DOOM... 

Fri, 04/15/2011 - 09:42 | 1172094 Long-John-Silver
Long-John-Silver's picture

Doom is bullish for Gold and Silver.

Fri, 04/15/2011 - 09:54 | 1172153 Argonaught
Argonaught's picture

Possible doom is bullish for PMs.  Actual doom is only bullish for bread and bullets, not so much rocks, shiny or otherwise.

Fri, 04/15/2011 - 10:00 | 1172167 Cash_is_Trash
Cash_is_Trash's picture

One step closer to ending like the French Assignats.


Fri, 04/15/2011 - 10:03 | 1172180 Cash_is_Trash
Cash_is_Trash's picture


Fri, 04/15/2011 - 10:05 | 1172193 Long-John-Silver
Long-John-Silver's picture

Silver, Gold, Iron, clay pot, and urine can be used to make a battery. You can connect several of these battery's to recharge your I-Pad. Recharging these batteries only requires dumping out the old urine and replacing with fresh urine.

Fri, 04/15/2011 - 11:19 | 1172516 Drachma
Drachma's picture

The thought of recharging those batteries had me pissing my pants.

Fri, 04/15/2011 - 10:04 | 1172171 topcallingtroll
topcallingtroll's picture


Double post or double penetration

Fri, 04/15/2011 - 10:14 | 1172234 moldygoat
moldygoat's picture

Oh shit, I thought my wife was going out for Dr. Pepper!

Fri, 04/15/2011 - 10:02 | 1172178 topcallingtroll
topcallingtroll's picture

Doom in moderation is actually bullish for the accepted currency.

I am kinda.hoping for a kinder and gentler doom. Like all the dooms we faced in the 20th century.

I prefer my doomworlds to stay on my pc.

Fri, 04/15/2011 - 10:31 | 1172306 gall batter
gall batter's picture

endoom-ment, anyone?   

Fri, 04/15/2011 - 09:45 | 1172096 Dick Darlington
Dick Darlington's picture

So why don't you switch on CNBC...

Fri, 04/15/2011 - 09:47 | 1172118 Sancho Ponzi
Sancho Ponzi's picture

Here you go, Hamy:


Fri, 04/15/2011 - 09:50 | 1172122 depression
depression's picture

Cheer Up Hamy, look at the bright side, at least they finally made the right decision and stopped "throwing good money after bad", so from that perspective this is a good decision, bullish for AAPL and stuff.

But then I realized there is no 'good money' anymore, well except for Gold but that doesn't count, right Hamy ?

Fri, 04/15/2011 - 09:55 | 1172157 topcallingtroll
topcallingtroll's picture

Oh my god.

If hamy is capitulating or becoming scared we are fucking doomed.

Cmon hamy cheer me up.

Get the gold bugs riled up.

Dont you think a one world government will be the result of all this financial stress, and finally bring peace to mankind?

Fri, 04/15/2011 - 12:06 | 1172731 gorillaonyourback
gorillaonyourback's picture

hamy if i remember right you sold all your silver at 26 and your gold at 1320.  your feelings of doom are coming from within.  are u lookin around at your fellow peons there manufacturing  consent and trying to give the illussion of calm and thinkin to yourself " gotta git out of here".  dont worry you will wake up to the fact that your pension will be gone your dollars worthless and the stocks you so treasure make good wallpaper lolololo

Fri, 04/15/2011 - 09:42 | 1172092 knukles
knukles's picture

"Raises concerns"

How quaint.  As if it's something newly found, a jewel of knowledge, an ah-hah moment, spiritual insight.

Raised concerns... in reality simply bitch slapping the EU across the face whilst soundly asleep dreaming wistful images of everything's been taken care of, OK, hunkie dorie and if not, we'll have another meeting and release another statement, mission accomplished. 

Ms. Kyeptokopolis, book me a first class flight to Berlin for the meeting, a suite at the Kampinski, love.  And give Bennie a ring, we'll need another mimeograph copy of the dollar swap drawdown...

Fri, 04/15/2011 - 09:44 | 1172093 nobusiness
nobusiness's picture

European's really don't like to do work on Fridays

Fri, 04/15/2011 - 09:46 | 1172109 knukles
knukles's picture


Fri, 04/15/2011 - 11:22 | 1172525 Urban Redneck
Urban Redneck's picture

No, and since the sun is shining beautifully on the central plateau in the Rhine valley- we have no need for Greek islands or paper (today).

Fri, 04/15/2011 - 09:45 | 1172098 Cdad
Cdad's picture

Ummmmm....I think "bidless" is about to become the "next thing" in more than just Greek debt.  How the Vix is under 16 right now is...?....simply just a clear example of how broken the market is, what with creation units machines in each and every one of our beloved criminal syndicate Wall Street banks.  

As was the case in Mid March, Vix calls are now trending ahead of the spot.  Here comes the turn the VXX etn...a nice, fat double bottom.



Fri, 04/15/2011 - 09:46 | 1172108 SofaPapa
SofaPapa's picture

The lack of response is indeed ominous.

Fri, 04/15/2011 - 09:53 | 1172135 topcallingtroll
topcallingtroll's picture

When the authorities are paralyzed and dont know what to say about south european and irish debt then it is time to....

Run away! Run away!

Fri, 04/15/2011 - 10:10 | 1172220 Terminus C
Terminus C's picture

I think I soiled my armour....

Fri, 04/15/2011 - 10:01 | 1172184 A Man without Q...
A Man without Qualities's picture

They're letting the bonds collapse, then will come in and offer an "voluntary" exchange for new bonds, most likely guaranteed by the EFSF at say 50c in the Euro, making sure not to trigger CDS.  They then wait until 2013 (when CDS contracts held by German and French banks have matured) and dump any remaining old Hellenic Republic bondholders.  That's my guess....

Everyone realizes that a haircut of some form is unavoidable, but it's going to be funny watching the Greek government meet the deficit reduction targets....

Fri, 04/15/2011 - 09:49 | 1172117 assumptionblindness
assumptionblindness's picture

Bring it on!

Fri, 04/15/2011 - 09:49 | 1172119 LawsofPhysics
LawsofPhysics's picture

Buy our bonds, look they are a great deal, just look at the promised return.

Fri, 04/15/2011 - 09:51 | 1172128 topcallingtroll
topcallingtroll's picture

Reggie is the man.

Too honest to go for the big bucks by becoming a conventional shill for goldman.

He called it and stuck by it.

Ireland portugal and spain will go too.

The end of euro credibility is near.

Fri, 04/15/2011 - 10:18 | 1172243 slackrabbit
slackrabbit's picture


I went through Sir Reginald's maths line by line.

In the end, doing turnarounds for a living it all comes back to the same truism.....'Dude, your losing more than your making'.

It doesn't matter if its primary goods, services, manufacturing or interest rates on government debt - if there more negative than postive, then restructuring (read: telling your creditors to suck it up or  sod-off) is the only answer.

I must admit, depending on the creditor I sometimes feel sorry for them - the small trader who just wants to be paid, or the investor who was duped; conversley sometimes  its called justice. 

The greeks need to just give the finger like the Icelanders and let their bondholders take their medicine.

Should be quite a show!

I'll bring the icelandic beer, you bring the greek popcorn.

Fri, 04/15/2011 - 10:58 | 1172445 FeralSerf
FeralSerf's picture

The Greeks did give them the finger, just not as publicly as the Icelanders did.  The Greek pols might have promised to pay back the debt, but only a real idiot (or someone like Goldman that's selling the bonds to their best customers and shorting them at the same time) believes that you really can get blood out of a turnip.

Someone in the GO turnip bidness needs to work on the problem.

Fri, 04/15/2011 - 09:54 | 1172139 ZackAttack
ZackAttack's picture

Well, the question is, where are the apologies for all the perfectly good money thrown after bad in the months prior to this?

Do they go on television and apologize to all the taxpayers for wasting that $1 trillion stabilization fund, when it made fuck-all of a difference?

Didn't the holders of this debt have literally months, if not years, to get this shit off their sheets? If they go away, it sounds to me like evolution in action.

Fri, 04/15/2011 - 10:14 | 1172237 topcallingtroll
topcallingtroll's picture

One trillion bought us two more years.

Place your new bets. The next round is beginning.

Fri, 04/15/2011 - 09:54 | 1172142 Sherman McCoy
Sherman McCoy's picture

Yeah that's a bright idea, buy VXX so you get in before the next reverse split. This is all bullish for U.S. Bonds, stocks, and the dollar. You just don't get it.

Fri, 04/15/2011 - 09:55 | 1172147 Seasmoke
Seasmoke's picture

someone is going to take it hard in the ass (but the Greeks like that, correct ?)

Fri, 04/15/2011 - 10:11 | 1172224 falak pema
falak pema's picture

only mad dogs and ANCIENT greeks, but then nowadays its an art form on the net! 

Fri, 04/15/2011 - 09:57 | 1172158 youngman
youngman's picture

I said before the Greeks will take all the money you will give them...steal it...then who is going to jail for giving the thief the one...its all good

Fri, 04/15/2011 - 10:08 | 1172208 writingsonthewall
writingsonthewall's picture

That is wrong - the Greek Government does that - the people work, try to get by, have aspirations inflated by crap talking politicians - just like the US in fact.

In defense of the Greeks, at least their people are doing something about the theft by rising up against the state - in the US you're all just bending over and waiting for the next 'bad news' to be issued by the Fed. The US Gubba-mint took the money, invaded and stole it where needed - and no bankers went to jail for theiving the's all good.

...what's the difference?

Fri, 04/15/2011 - 10:14 | 1172228 topcallingtroll
topcallingtroll's picture

Good point.

But greece has the record for sovereign defaults in europe over the last 150 years or so.

Which ijit keeps loaning a deadbeat money?

Fri, 04/15/2011 - 10:31 | 1172309 writingsonthewall
writingsonthewall's picture

The answer is greedy ijit's who want to make profit - I thought that was obvious!


It's the same greedy ijit's who lent sub-prime homeowners fact in that case it's all the same greedy GS ijit's.


The real question is not who and how - but why, why does anybody lend money to those who have a bad history of paying it back?


The answer lies here.


If you look back throughout history - and at all the crises - they all start with lending to people or nations who are increasingly less likely to pay it back.

The only reason for anyone to engage in such self destructive behaviour (which is ultimately what it is) - is because they fear self destruction if they don't lend it - through competition (i.e. if you don't lend, your competitiors will and you will be bankrupt anyway)


Until the world recognises this fact then we're doomed to keep repeating the same mistakes over and over again.

Fri, 04/15/2011 - 13:52 | 1173260 Thisson
Thisson's picture

Your comment really resonated with truth for me.  Reading the FCIC report, it was clear that Countrywide and the GSEs both made increasingly poor loan decisions due to fear of losing market-share.

Fri, 04/15/2011 - 11:07 | 1172484 FeralSerf
FeralSerf's picture

Which ijit keeps loaning a deadbeat money?

One that makes his money from taking a precentage of the pass-through.  I'd loan them some of your money if I get to keep a few percentages for making it all possible.

This trade is getting more difficult all the time thanks to all the bad publicity it's getting.  Maybe I'll need to up my percentage.  How about a 99% loan fee and the Greek gets the 1%?  It's even getting hard to find a German widow willing to provide the funds.  Maybe I can tell her that she'll get double the interest rate she got before.



Fri, 04/15/2011 - 11:28 | 1172562 writingsonthewall
writingsonthewall's picture

...and this is the point at which banking fails....

If you know that someone is going to default (which we all do now about greece) - what is an appropriate interest rate?

99% - too little my friend, it's a default certainty, nothing will stop Greece defaulting now, not even the ECB.

Interest rates only reflect risk that the bankers think they can identify - in truth their logic is flawed as no interest rate covers the 'black swan' event. They hope to play the numbers game (lend to 1 million borrowers, only 10% will actually default) - but the problem with this is it merely hides the risk - the risk of a 80%, 90%, 100% default rate.

The only solution (as you say) is to play 'hot potato' - arrange the debt and then pass it on quick - but as we have now learnt - this is not a problem 'solver' but a problem 'mover' - and it infects the wider economy and eventually brings it all crashing down.


Bankers are not clever people, they think they are, they pay themselves like they are, but they are not clever.


They also underestimate massively the backlash from the wreckage they have created - their profits will be very much down when people are starting to set fire to banks in response to the austerity measures imposed on them.

Most sensible people would quit before the gunfire starts - but these thick bankers can't help themselves and are still dipping into the buscuit tin further cementing their doom.


Max Keiser was on UK TV last night calling for bankers to be hung - at the moment he looks like a nut - but soon this will be the norm.

Fri, 04/15/2011 - 12:13 | 1172776 tired1
tired1's picture

My question is: what do the banksters actually lose by loaning fiat currency?

Fri, 04/15/2011 - 13:56 | 1173269 Thisson
Thisson's picture

Max Keiser is crossing the line when he advocates violence.

The problem we have isn't the lack of violence, it's a lack of critical thinking by the masses.

Fri, 04/15/2011 - 13:57 | 1173270 Thisson
Thisson's picture

Max Keiser is crossing the line when he advocates violence.

The problem we have isn't the lack of violence, it's a lack of critical thinking by the masses.

Fri, 04/15/2011 - 09:58 | 1172161 youngman
youngman's picture

I said before the Greeks will take all the money you will give them...steal it...then who is going to jail for giving the thief the one...its all good

Fri, 04/15/2011 - 09:56 | 1172163 X. Kurt OSis
X. Kurt OSis's picture

From a European bank's desk this morning (pretty funny):

Growing up, every small town had one derranged mental patient dragging his knuckles about; cruising your main thoroughfare in his parks department truck while ogling females with the tact of a chimpanzee. When he wasn't collecting cans to fund his pornography habit, he was shotgunning beers with high school kids ten years his junior. The mayor in his own mind. At times exaggeratingly friendly, rumors of strange behavior -- eating of cats, for instance -- kept you at a safe distance. Schizophrenia, the white coats might say. Behavioral psychology is surely more art than science; an awfully tough discipline, if not an impossible one, to model. The bane of every asset manager is the navigation through these fickle channels of shifting mood. One week we're wearing lampshades to celebrate bank recapitalizations as they pertain to sovereign health, the next we're solemnly analyzing debt restructure models while cringing from the reinforcing sucker punches of S&P and German FM Schaeuble. Both issues have been served up on the same table for months, yet the almighty investor -- influenced, presumably, by whatever Bloomberg shovels to the top of their TOP on any given day -- is left as a reactionary pawn in a game with no winners.
This week we're clearly "risk off," with consistent real money offers matched with the levered players' tabling of exposure. Even good old reliable Spain, where descriptions of two-way flow were becoming cliche, has been torn the proverbial new one, despite China's Wen Jiabao shaking his pom poms and megaphone toward the SPGB market. Likewise, yesterday's BTP auctions were no more than "decent," with a 7bp concession lingering over the normally fluid Italian market, post-supply. Adding insult to injury, due to a combination of low firepower, reluctance, infighting, and a touch of mystery, the ECB's soveriegn purchase program has shown nary an indication of buying near the tights. I wouldn't either, mind you, but my ass isn't on the line in holding the liquidity of a German empire together. Think of it as standing over a man and watching him die because you'd rather not waste your iPhone battery by calling 911. Better yet, think of it as having a really bad battery.

So as we shuffle through the gulf between today and the June Greek audits, every Europan pundit will remind us how GGB's (and possibly even PGB's) require a restructure, and every non-German politician will refute the claims while providing no evidence to the contrary, save the usual motivational pablum about Europe standing firm.

Except there is nothing firm about burning through your bailout loan by 2012 amidst unexceptional growth, staring at a laughably high primary surplus target just to stabilize your double-digit yielding debt at 165% of your waning GDP while your citizens grow restless with perpetual austerity. That's not firm. It's flacid. It's unsustainable. Interestingly, according to a conference earlier this week, the banks most at risk in a reprofiling are not Athens-based, but our friends at BNP, SG, DB, and BARC. Are we worse now than we've ever been in modern times? Obviously, that's debatable. Remember, 35 years ago the world was contending with disco and KISS ALIVE!, so it's not like everything was blue skies and green pastures pre-EMU.

Finally, we end as we began. For the curious few who've found their way to the bottom, the derranged mental patient in MY town was a dimwit who wound up taking a job as a parking meter policeman. After swearing that there was no way this fool could best me after high school, I wound up on the receiving end of a barrage of tickets for parking illegally at the train station without a permit. His name graced all of them. Enjoy your weekend.

Fri, 04/15/2011 - 10:11 | 1172199 topcallingtroll
topcallingtroll's picture

Sorry. Double penetration

Fri, 04/15/2011 - 10:09 | 1172204 topcallingtroll
topcallingtroll's picture

This is classic americana. Even the subtle references.

Has american banking and writing styles taken over europe?

Fri, 04/15/2011 - 10:20 | 1172247 X. Kurt OSis
X. Kurt OSis's picture

NY desk for a euro zone bank.

Fri, 04/15/2011 - 11:59 | 1172700 Double down
Double down's picture

Which writer?  That is really funny!  Thanks for posting. 

Fri, 04/15/2011 - 12:14 | 1172782 X. Kurt OSis
X. Kurt OSis's picture

Banca IMI

Fri, 04/15/2011 - 10:01 | 1172170 writingsonthewall
writingsonthewall's picture

If Greece are allowed to default - the real magic won't be in the bondholder haircut for Greece, but in all those other PIIGS as the market (dum dum bullets) finally realise that the EU will allow nations to default

Whoops - there goes the EU guarantee that's been keeping rates down. I know if I were holding other PIIGS debt and I saw Greece fall I would be dumping faster than it's customary after a chicken vindaloo.

This is the real problem with putting off D-Day (default day) - you have made the situation worse as all PIIGS will fall together rather than over time (if the markets had their way.....probably)

Clearly the EU didn't think this through...or they actually convinced themselves that this day would not come.


It's bailout or blowup time Trichet.

Fri, 04/15/2011 - 10:05 | 1172192 SilverBaron
SilverBaron's picture

This is what happens when central banks raise interest rates.  We at the Fed are not going to make that mistake.  This is why we are announcing that we are lowering our rates down to minus .25%.  That's right, if you are TBTF will give you free money.  Wait, aren't we already doing that? 

Fri, 04/15/2011 - 10:07 | 1172205 magpie
magpie's picture

And the American tax payer / cartel printing press / HFT algos all buying the tzaziki-flavoured dip.

Fri, 04/15/2011 - 10:08 | 1172211 PulauHantu29
PulauHantu29's picture

Does anyone think of working anymore and simply paying off their debt? or does eveyone want a Bailout?

Fri, 04/15/2011 - 10:40 | 1172348 Crisismode
Crisismode's picture




Fri, 04/15/2011 - 10:11 | 1172223 Rodent Freikorps
Rodent Freikorps's picture

Why throw good money after bad?

Back before we had TBTFs, everyone knew that lesson.

Fri, 04/15/2011 - 10:13 | 1172229 Bahamas
Bahamas's picture

Somebody must be wanting for Greece to default, exit the euro and go back to the undervalued Dracma so they can start to go back there to vacation to the islands like the good old pre-euro days when it used to be cheap.

Santorini Beaches

Fri, 04/15/2011 - 10:43 | 1172357 Crisismode
Crisismode's picture

They simply are not throwing good money after bad.

All fiat gets worse over time.

Thus, they are throwing worse money after bad.

Fri, 04/15/2011 - 10:14 | 1172236 falak pema
falak pema's picture

The chinese will buy up greece problem...they have the bum USD to buy the bum Euro a bum's paradise these days!

Fri, 04/15/2011 - 10:17 | 1172241 Bahamas
Bahamas's picture

Print, buy and repeat

Fri, 04/15/2011 - 10:21 | 1172254 gwar5
gwar5's picture

"25 species naturally go extinct everyday in the world, let them go gracefully," George Carlin.

Of course, the same could be said about sovereign defaults, and the EU.

Fri, 04/15/2011 - 10:51 | 1172403 Long Duck Dong
Long Duck Dong's picture

If the fed decides to buy up debt and take Greece over can we first airlift some deoderant and razors to the masses prior to our moving in?

Fri, 04/15/2011 - 10:57 | 1172442 CrashisOptimistic
CrashisOptimistic's picture

The banks have been INCREASING swap positions in these toxic country sovereigns in order to be able to terrify their puppet prime ministers into vectoring tax money into the banks' pockets, but it appears that finally they were forced to divest the Greek swaps.

Make no mistake about it; only if the banks no longer have Greek swap exposure would this be allowed.  Or maybe they offloaded the swaps onto US banks and this will be the blackmail weapon to force a return of US air forces to the Libyan disaster.

Fri, 04/15/2011 - 11:55 | 1172485 virgilcaine
virgilcaine's picture

still have some life left in the Greek yet.. it will be over at around  10 yr @ 16-17% so until then btd.

Fri, 04/15/2011 - 11:19 | 1172523 ivana
ivana's picture

Greek 2Ybond 17,97% !!!

So we see who's gonna be sacrificed first ... rest of PIIGS to come. Regardless of chinese PIIGS bond lifeline.

Which is just stretching chord more and more on global markets...

Fri, 04/15/2011 - 11:31 | 1172578 cabernet
cabernet's picture

The big question is how low will be THE low. My guess is that the default will lead to a bond swap that results in a write down of 75% of par. Then we must ask "Who will be next?" Once Greece plows the road, all the other governments of highly indebted European countries could follow suit, if they have a brain. A big if.


Fri, 04/15/2011 - 11:50 | 1172663 Bam_Man
Bam_Man's picture

Pass me the ouzo.

Fri, 04/15/2011 - 12:05 | 1172727 franzpick
franzpick's picture

Au and Ag started their current $13 and 50c runups around the time of TD's post at 934am, showing a quick responce to the Greek bond news.

With oil, grains, softs and REMs generally still flat, we may not yet be seeing the financialization of commodities, but it's looking clearer to me that we are seeing the financialization of the 2 PMs, and perhaps ready to see the fog of global debt-refinancing cleared away by the appearance of Mr. Market.

$1500 Au and $43 plus Ag are easy targets today in this deteriorating environment.

Fri, 04/15/2011 - 13:45 | 1173221 americanspirit
americanspirit's picture

The dimwitted can collector in my home town became Fed Chairman and has his fun these days wiping his ass with Federal reserve notes before handing them to us.

Fri, 04/15/2011 - 19:00 | 1174617 Buck Johnson
Buck Johnson's picture

Greece is about to default, I wouldn't be surprised if they don't do it this weekend.

Fri, 04/15/2011 - 20:51 | 1174864 vainamoinen
vainamoinen's picture

 X. Kurt OSis - Great Post!!!

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