IMF Tells Eurozone To Buy More, More, More Bonds And That It Needs A Bigger Boat, Er, Rescue Fund; Belgium Wants A Bigger Pie Too

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Sun, 12/05/2010 - 13:53 | 779620 Mongo
Mongo's picture

The cleptocrats are finalizing their masterpiece...

 

What IS that smell...

http://mfc.elmberg.net/files/images/euro_smell.jpg

Sun, 12/05/2010 - 14:23 | 779677 tickhound
tickhound's picture

Its the smell of the one-world printing press overheating...

Are we angry yet?

http://www.youtube.com/watch?v=ke5Mr5eCF2U

Sun, 12/05/2010 - 17:31 | 780011 IQ 145
IQ 145's picture

 This article makes me feel sick. "help the members avoid the consequence of their own fiscal irresponsibility"; is more like it. The whole thing is just spin; where did reality get lost here?

Sun, 12/05/2010 - 13:54 | 779623 Everyman
Everyman's picture

Didn't they fix this like last year, six months ago and last week?

When will this thing be "fixed"???

Sun, 12/05/2010 - 14:59 | 779749 the mad hatter
the mad hatter's picture

When your dollars, euros, and other fiat currencies are utterly destroyed and we have to institute a new global currency. that too will fail, meanwhile the same people who control our currencies and governments will stay in power, being sure to keep their own assets in hard assets.

http://unconstitutional.blogspot.com

Sun, 12/05/2010 - 15:58 | 779855 A Man without Q...
A Man without Qualities's picture

Global currency my arse.  It's hardly been a resounding success to have the Eurozone nations under the same currency, they're hardly going to push for a global one.  Add to that, the US is never going to go for anything other than the Dollar, as the alternative would place limits on how much fiat the government could spend.

Sun, 12/05/2010 - 19:10 | 780191 goldsaver
goldsaver's picture

You assume that it would be optional. If the Fed collapses the dollar, a new currency would have to be issued to restart the ponzi. Enter the SDR.

Sun, 12/05/2010 - 13:59 | 779625 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Does anyone believe this is not orchestrated by all parties on behalf of binding all states to one printing press?  Each Chairman of the Central Banks tosses in his press for the purpose that they will join together in the netherworld.

The banksters are thieving salesmen peddling useless FIAT.

Sun, 12/05/2010 - 15:43 | 779818 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

When the smoke finally clears, it will be argued that many central banks operating independently all over the world is a situation perfectly analogous to the days of wildcat banking in the United States.  If a loss of confidence leads to a run on one central bank and the sudden discounting in the value of their notes in turn disrupts other economies and threatens to destabilize the entire system, then the obvious solution is to have all the world's central banks hold their deposits with a World Central Bank which becomes the sole issuer of legal tender to be used by everyone on the planet.  This simple maneuver will forever make "contagion" impossible and will guarantee a Nobel prize for whomever dawns the fanciest looking hat before proposing it.

Theories about "fractional reserve lending and lack of gold backing" being the real cause of the crisis will be treated as cute but irrelevant in today's fast paced modern world.  Moreover your neighbours, who watch TV, will be only too eager to inform you that the convenience of doing away with currency exchange alone is reason enough to embrace the new system.  "Why should I have to pay to convert my money to Krona just to visit some Icelander who didn't pay his debts and wants to pretend his country is somehow deserving of distinction above everyone else in the world?  Do you know how much harder it is to track terrorist funding schemes with all these independent nations who insist on running their own affairs?  The world just cannot afford this sort of vanity any longer."

 

Prepare yourself mentally for this, because it's going to happen.

 

Sun, 12/05/2010 - 16:14 | 779878 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

Sweet!  My first junk!

 

I guess Paul Krugman can't handle the truth....

 

 

Sun, 12/05/2010 - 17:00 | 779958 ConfederateH
ConfederateH's picture

Blog-post masturbation is best reserved for private appearances.

Sun, 12/05/2010 - 17:17 | 779991 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

Yeah, I figured it was some weak minded coward who didn't like having his beliefs questioned, but who couldn't formulate a response. 

They usually cannot withstand being called out

Sun, 12/05/2010 - 13:59 | 779632 Sean7k
Sean7k's picture

Here I was thinking there would be a "new" world currency. Hah! It will be the dollar- flooded into every corner of the globe and made legal currency everywhere. Brillant! Got a bond? We will give you dollars- process at the BIS please.

Sun, 12/05/2010 - 14:31 | 779694 Popo
Popo's picture

While the prospect of a unified currency is scary, one should note, that it by no means solves their problems over the long run. The banks will still become insolvent given time and deregulation.

The only solution is for bond holders to take a haircut.

Do it you fuckers.

Sun, 12/05/2010 - 14:49 | 779732 Sean7k
Sean7k's picture

Unfortunately, there will be no deregulation and if Ireland is any example, and it is, there will be no haircuts. However, we do not call them fuckers for nothing.

Sun, 12/05/2010 - 17:35 | 780021 Eternal Student
Eternal Student's picture

I'm of the opinion that there will indeed be haircuts. But only after all the real money has been looted. Ireland is a superb example. The Banksters managed to grab $20 Billion that the pensions had, in order to keep the European Banks up. All the while promoting the meme "Save Ireland".

You have to admit that pulling off that PR, while stealing a ton of money, is expertly done.

But all Ponzi's do end, when the money stops pouring in. My bet is after the Pensions and Retirement Accounts in the U.S. have been stolen, under the guise of "saving" them, just like they "saved" Ireland.

Sun, 12/05/2010 - 14:01 | 779635 vote_libertaria...
vote_libertarian_party's picture

How are interests rates not > 25%???

 

un-frickin-real

Sun, 12/05/2010 - 14:44 | 779721 CrashisOptimistic
CrashisOptimistic's picture

Dood, you raise interest rates when you have such an overwhelming demand for your lending that you can do so to make a profit.

No one is trying to borrow money.  There's no demand for lending.  How do you raise the price of something no one wants?

Sun, 12/05/2010 - 16:13 | 779877 billhilly
billhilly's picture

In equities its called HFT.

Sun, 12/05/2010 - 16:32 | 779911 What_Me_Worry
What_Me_Worry's picture

Higher interest rates would encourage saving.  Higher savings could eventually result in higher investments in functional debt and create jobs.  Instead, newly-created money is invested in non-functional debt that not only doesn't create jobs, but will eventually cause job losses and the same inflation that would have come anyways had you had debt at non-manipulated levels.

Sun, 12/05/2010 - 14:12 | 779653 samsara
samsara's picture

 

On a side note,  Highly recommend reading today's piece at AutomaticEarth (sister site in spirit).

Ashvin Pandurangi:
The Debt-Dollar Discpline:
Part I - Financial Discipline & Punish

"*The following is Part I in a two part series of articles on the relatively rapid emergence and collapse of the "debt-dollar discipline" imposed on our global society. ... This part will introduce Michel Foucault's (renowned French philosopher, 1926-1984) analysis of "discipline" and "punish" in the modern state, and apply it to the global debt-dollar reserve system. The next part will focus entirely on the ongoing collapse of this disciplinary system, as it such an important and far-reaching topic."


http://theautomaticearth.blogspot.com/

He lays out a really good framework of it all.

Well worth your time.   One of the topics is how the IMF is used within the "discipline" and "punish"  Framework.

Oh and on the IMF "Method" refer back to this piece.

"...Each nation's economy is individually analyzed, then, says Stiglitz, the Bank hands every minister the same exact four-step program.

Step One is Privatization - which Stiglitz said could more accurately be called, 'Briberization.' Rather than object to the sell-offs of state industries, he said national leaders - using the World Bank's demands to silence local critics - happily flogged their electricity and water companies. "You could see their eyes widen" at the prospect of 10% commissions paid to Swiss bank accounts for simply shaving a few billion off the sale price of national assets...."

http://www.gregpalast.com/the-globalizer-who-came-in-from-the-cold/

To quote Harry.

"The only thing new in the world is the history you don’t know. " Harry Truman
Sun, 12/05/2010 - 14:32 | 779696 Mark Medinnus
Mark Medinnus's picture

"The only thing new in the world is the history you don’t know."  Harry Truman

Ignorance is new: a perfect testimonial from the man who twice lit Japan. 

Sun, 12/05/2010 - 14:52 | 779727 CrashisOptimistic
CrashisOptimistic's picture

Japan was nuked, twice, because of oil.

Oil defines everything and you guys have not embraced the truth of this.  

Japan has no oil.  Japan has no natural gas.  Japan has no coal.  FDR embargoed oil from them (the US was the Saudi Arabia of oil exports in the late 30s) in August of 1941.  Four months later they bombed Pearl . . . *because they had to*.  They had no oil supply.  They had to be able to get to Indonesia to get theirs.

All this hand waving and intricate machination from the ECB and EU and IMF inevitably evolves to abject silliness when it becomes crushingly clear that oil production insufficiency caps economic growth.

Forever.

Sun, 12/05/2010 - 15:04 | 779759 Popo
Popo's picture

Well, when you say "had to", that's a bit much. You seem to gloss over the fact that Japan was actively involved in it's conquest of Asia. If you believe that their efforts to subjugate all of East Asia were some kind of 'mandate' which could not be shied away from, then yes, they "had to" attack Pearl Harbour. But one must point out that they could also have just stopped being imperialist assholes. A move which would have halved their oil consumption.

Sun, 12/05/2010 - 15:14 | 779776 CrashisOptimistic
CrashisOptimistic's picture

You're generally right, but you lean too much on being right.  Let me reword your position, amorally:

If Japan had simply accepted imposition of national policy by a foreign power via oil embargo there would have been no problem.  

Naturally, this extrapolates to the US and Israel in the 70's.  If you were Japan then, you could never have accepted such a thing.  So they had to react as they did.

 

Sun, 12/05/2010 - 19:42 | 780262 Zeilschip
Zeilschip's picture

Yeah those poor Japs. The Yanks forced them to kill 25 million Chinese..

Sun, 12/05/2010 - 15:43 | 779832 Tense INDIAN
Tense INDIAN's picture

nuked twice because of oil.......i dont think thats what happened.....i believe that they were just testing the Bombs......i have read somewhere how Hiroshima , Nagasaki and one more town were left untouched by the Aerial Bombings...these elites may have wanted to study the effect of these bombs on live and untouched cities and people.......

 

Sun, 12/05/2010 - 17:39 | 780028 Eternal Student
Eternal Student's picture

Ditto on the recommendation of the Ashvin article. It is one of the most insightful things I've read. A must read if you want a really good explanation of the big picture, how it works, and why.

Sun, 12/05/2010 - 22:25 | 780861 samsara
samsara's picture

Thanks

Thats how I saw it also.   That one article brought it all together.   Knew all the pieces, but he did a  really nice job coalescing it all.  putting in context of Michel Foucault's "Discipline and Punish"  was perfect.  

Sun, 12/05/2010 - 14:19 | 779668 Bob
Bob's picture

Fractional reserve lending/debt money with interest, corptocracy, economic hitmen and the IMF:

http://www.youtube.com/watch?v=1gKX9TWRyfs&feature=related

The most lucid explanation of it all that I've ever seen. 

Sun, 12/05/2010 - 14:36 | 779702 tickhound
tickhound's picture

Ah yes, Zeitgeist... A key ingredient in the "red pill"

Sun, 12/05/2010 - 14:29 | 779691 DavidRicardo
DavidRicardo's picture

"with everyone expecting muni bonds to be the purchasing target of QE3, will Bernanke again fool everyone and instead opt for direct European bond monetization? After all, the destruction of dollar value is and always has been the Fed's primary imperative, and what better way to achieve this than to collateralize the greenback with Greek bonds?"

 

My question is: is ZH run by the Federal Reserve?  Because this is a signal if I ever read one.  It's saying: "Depending on the political reaction, we will disguise our purchasing of both Munis and Greek bonds."

 

And if ZH is not the Fed, and supposedly opposes the Fed, but is, also, READ BY the Fed, then if I was the Fed, I would say, "Gee, thanks for the heads up.  Depending on the political reaction, I will disguise my purchase of both Munis and Greek debt, to the extent necessary to ward off any negative political reaction."

 

Why does ZH show its hand, such that the Fed consistently outmaneuvers it.

 

To the point that we will now have $70 trillion of bailouts--NO haircuts and NO bailouts.

 

Thanks, Uncle Sam!  Er, I mean, ZH!

Sun, 12/05/2010 - 14:38 | 779708 Bearster
Bearster's picture

On issue after issue after issue, from child abductions to terrorism now to the Fed, people always say "shh, don't say that, you'll give them ideas."

We are still a (semi) free country, which still (more or less) has freedom of speech.  People say what they say.

If the only thing protecting us from mass murder is that the would-be murderer hopefully doesn't *think* of it... we are in deep deep trouble.

'Course, when it comes to our currency, and our financial system, and our welfare / entitlement / edukation / social security / nanny State, we are long past the point of mere deep trouble.  It is a matter of when, not if.

Sun, 12/05/2010 - 14:52 | 779736 Sean7k
Sean7k's picture

Coming from the namesake of the economist of the English central bankers in his time, I find your comment hilarious.

Sun, 12/05/2010 - 15:19 | 779784 Bob
Bob's picture

Whut?

Sun, 12/05/2010 - 15:50 | 779843 Misean
Misean's picture

Methinks you discount too aggressively the arrogance that accumulates in the minds of those controlling seemingly endless supplies of fiat power.

Sun, 12/05/2010 - 14:34 | 779699 Bearster
Bearster's picture

The Fed doesn't want to kill the dollar.  That's silly (or breathless hyperbole).  It is a parasite.  A parasite does not *want* to kill the host, but of course if it's growth is unchecked it does, in fact, kill the host.

Sun, 12/05/2010 - 15:38 | 779821 LeBalance
LeBalance's picture

Please contrast your fabulous point with the reality of the previous 3800 dead fiat currencies and the factional reserve central banks that created, ran, and then killed them.  Please bring into the conversation that this is just the life cycle of the client central bank (not the head) and also the client currency (not the overall concept), both of which live on for the higher order parasite/host.

If there is time, please allude to the fact the higher host/parasite central bank actually creates the country and all that it is anyway, as a host for its client bankers to live in and then consume, like a good brood mom.

Sun, 12/05/2010 - 14:39 | 779711 steve from virginia
steve from virginia's picture

I agree the IMF would like to usurp the EU and 'colonize' Europe they way it has colonized S. America and Africa. Talk about overstepping.

I agree the Fed can and will help flood the Eurozone with dollars that can be traded/sterilized into more and more and more euros. Counterproductive, of course as the US establishment would like a devalued dollar, rather than a devalued euro.

Both continents share high unemployment rates.

I disagree with the basic contention that the Fed or any other agency is able to completely deflate dollar value. Instead the dollar is 'inflation proof' being linked inextricably to crude oil. The crude price @ a certain level causes the productive economy (what is left of it) to crash which destroys crude demand. This 'crash point' is the upper bound on dollar devaluation. I suspect the dollar price for crude is @ that crash level right now.

This is not to say the market cannot take on a 'life of its own' and push crude prices much higher, even to $147 a barrel. For the market to do so would be suicidal as the resulting crash would have even more profound consequences than did the crash in 2008- 2009.

This time there is no 'super- sovereign' to bail out the insolvent countries, insolvent mega- banks or the insolvent derivatives' markets, along with airlines, transport/shipping companies, auto manufacturers, etc. The Fed/ECB would be exposed as useless and the race to systemic deleveraging cascade would be on.

Sun, 12/05/2010 - 18:21 | 780095 goldsaver
goldsaver's picture

I agree the Fed can and will help flood the Eurozone with dollars that can be traded/sterilized into more and more and more euros. Counterproductive, of course as the US establishment would like a devalued dollar, rather than a devalued euro

How about both? Wouldnt the destruction of both currencies by default create the "need" for a "new" currency? And wouldnt whomever controls this new currency become the next super power?

I disagree with the basic contention that the Fed or any other agency is able to completely deflate dollar value. Instead the dollar is 'inflation proof' being linked inextricably to crude oil. The crude price @ a certain level causes the productive economy (what is left of it) to crash which destroys crude demand. This 'crash point' is the upper bound on dollar devaluation. I suspect the dollar price for crude is @ that crash level right now.

Wouldn't this cause the US economy to collapse requiring the US to borrow exponentially more in order to subsidize the cost of energy (heat subsidies, mass transportation subsidies, housing subsidies that force people to migrate to cities or die)? This is a vicious cycle that gives the Fed more and more control over the US government. The private Fed is now purchasing all Federal Debt. QE3 will buy all state debt. At the end the Fed will legally control all assets in the Federal and state governments. How can a state like California reject the "suggestions" from the Fed when the Fed can cut off all further financing of California's debt? If California can not borrow enough money to operate, it collapses. When interest on the debt exceeds the tax receipts, does the Fed not own California?

This time there is no 'super- sovereign' to bail out the insolvent countries, insolvent mega- banks or the insolvent derivatives' markets, along with airlines, transport/shipping companies, auto manufacturers, etc. The Fed/ECB would be exposed as useless and the race to systemic deleveraging cascade would be on.

Disagree,the Fed IS the super-sovereign. The can create unlimited amount of currency to provide the states with liquidity. That is the intent. Inflate the economy to the point where the states can no longer afford to pay the interest rates and the Fed will ride in on their white horse and bail them out. wash, rinse, repeat. Eventually all funding will come from the Fed as all tax receipts will have to be paid to the Fed as interest on the balloning debt.

Presto, The United Sates of the Fed.

Sun, 12/05/2010 - 14:43 | 779717 hugovanderbubble
hugovanderbubble's picture

Dexia is in default

KBC too cos snowball effect in belgium.Contagious risk higher. CDS will attack Belgium and Netherlands. Then Sweden and Baltic Countries.

Aegon and insurance next

Axa has big big tough problems...

Tell me how possible that EUR/USD still at 1.34 when it should be below 1¡¡¡¡¡ Sorcery¡¡¡¡¡¡

Sun, 12/05/2010 - 15:29 | 779806 Black Forest
Black Forest's picture

CDS will attack Belgium and Netherlands. Then Sweden and Baltic Countries.

Why Sweden?

Sun, 12/05/2010 - 19:48 | 780282 Zeilschip
Zeilschip's picture

You're wrong, Netherlands is the last EURO credit before Germany to get 'attacked'.. Stop smoking crack.

Sun, 12/05/2010 - 15:08 | 779769 sabra1
sabra1's picture

Bloomberg:

Chinese `Patriotic Hackers' Hit Google, U.S. Sites, New York Times Reports

 

“Patriotic hackers” backed by Chinese authorities conducted extensive computer hacking on U.S. government agencies and companies, including computer networks of Google Inc., according to a report published today by the New York Times.

Sun, 12/05/2010 - 15:25 | 779793 Bob
Bob's picture

http://www.bloomberg.com/news/2010-12-05/chinese-patriotic-hackers-hit-g...

Ironic that this news came from Wikileaks . . .

Sun, 12/05/2010 - 15:23 | 779795 doggis
doggis's picture

THE FED IS NOW OPENLY ACTING AS THE GLOBAL CENTRAL BANK. THE FEDERAL RESERVE ACT NO LONGER APPLIES TO THIS INSTITUTION. THE  "CREDIT FACILITIES" OPENED DURING THE MELTDOWN OF 08/09  INDICATE THAT IT HAS SUPERCEDED THIS ACT, AND IT NOW ANSWERS TO NO JURISDICTION.......

Sun, 12/05/2010 - 15:51 | 779845 Dismal Scientist
Dismal Scientist's picture

Stop shouting. Take your Caps Lock off please.

Sun, 12/05/2010 - 15:33 | 779814 sabra1
sabra1's picture

the only way out of all this indebtedness, is world war111, when everything has to be rebuilt, with a smaller population!

Sun, 12/05/2010 - 16:25 | 779901 Bob
Bob's picture

I've always admired creativity.  What is your argument for not killing yourself for the good of humanity?

Or would it be other dead people you have in mind?

 

Sun, 12/05/2010 - 18:04 | 779833 Convolved Man
Convolved Man's picture

We have good news and bad news.  It was revealed to our top monetary policy makers that time travel will be successfully invented and due to deteriorating economic conditions in the future, the best economic historians of the future have traveled to the present time in order to provide sound guidance to mitigate the coming global economic calamity.  We have followed their advice, which has been the basis for the recent bailout, stimulus, low Fed funds rate, and quantitative easing programs.  However, the latest emissaries from the future, talking monkey-men, arrived today and their recommendations are that we now institute sacrificial offerings of Keynesian devotees on a golden alter to appease the deficit spirits.  If this radical approach does not work, the monkey-men are prepared to travel further back in time and prevent the invention of financing.

Do NOT follow this link or you will be banned from the site!