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Irish Bund Spreads Pass 600bps, 100bps Wider In A Week

Tyler Durden's picture




 

This was at 500 a week ago. The catalyst is a statement from EU's Rehn that there has so far been no request of EU financial aid from Ireland. Otherwise nothing much to see here: the higher the spread goes, the faster the market will ramp up. After all, worst case the Fed will merely have to give the ECB a few hundred billion in excess liquidity which in turn will be funneled into bankrupt Irish banks, which, in turn will turn around and buy Amazon and E-bay.

 

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Wed, 11/10/2010 - 10:26 | 716031 firstdivision
firstdivision's picture

Seeing this makes me laugh so hard.  I can recollect a few years ago, my mom made me watch a thing on 60 minutes with how booming Ireland was and how everyone was flush with cash to buy BMW's, and expensive houses.  Yes, credit is good untill it comes time pay it back with the interest.  Thanks goes out to the ECB and that farce of a stress test and allowing great positions to short the dying dog of a Euro.  Next up to bat on the debt diamond will be Portugal, then Spain.

Wed, 11/10/2010 - 10:39 | 716071 ratava
ratava's picture

I would put France and Italy ahead of Spain. Sarkozy and Berlusconi will make great scapegoats. I can't wait to see all the "Markets unnerved by political crisis" headlines to mask the actual economic earthquake unnerving them.

Wed, 11/10/2010 - 10:43 | 716083 infotechsailor
infotechsailor's picture

Okay, so much for RESPECT THE VOTE...

a few times rammed down the throat and promises of milk and honey if they join the EU, and now look at them.  Cheers, McDumbasses.

Wed, 11/10/2010 - 11:53 | 716420 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Maybe the Irish are more cunning than we thought. If they go ahead and default, what the hell is the ECB going to do? The Irish are screwed and they know it. Bring in the IMF/ECB, it will get worst. They might have learned the lessons that Iceland gave. The best path to recovery is to eliminate the bankers.

Wed, 11/10/2010 - 10:54 | 716118 jus_lite_reading
jus_lite_reading's picture

"Economic Earthquake"

 

That will not describe it...

Wed, 11/10/2010 - 10:59 | 716133 morph
morph's picture

Ireland is also screwed as you can easily claim unemployment benefit of €200 a week!

Why bother working? What company can compete with that wage? To pay someone €200 net a week it costs about €300. 

Wed, 11/10/2010 - 11:26 | 716273 Mr.Kowalski
Mr.Kowalski's picture

Rumors this morning that the Emerald Isle is in consultations with the IMF. Greece and Portugal to follow within a fortnight. KABOOM !

Wed, 11/10/2010 - 21:53 | 718465 Buck Johnson
Buck Johnson's picture

I saw that 60 minutes piece, it was called The Celtic Tiger.  It was done back in 1998, I'll post the whole transcript of it that is located at CBS.  But it goes to show you how things can change in 12 years.  The BMW sales woman was freaking hot, her name was Eileen Corrigan.  They also did a report from last year about the decline.  I think Irelands going to default just like Iceland.  I think they are going to let the smaller ones fail because the cost is to much in the end. 

http://www.cbsnews.com/stories/2000/12/11/60II/main256404.shtml

http://www.cbsnews.com/video/watch/?id=4851793n

Wed, 11/10/2010 - 10:28 | 716040 Goldenballs
Goldenballs's picture

Time to hit the Streets in Dublin,Cork,Waterford,Killarney,etc.

Wed, 11/10/2010 - 10:55 | 716121 jus_lite_reading
jus_lite_reading's picture

Wait til the books are opened and the people of the Green Isle realize they've been had by their gov't/bankers... the bank run has not even started yet.

Wed, 11/10/2010 - 10:36 | 716064 RockyRacoon
RockyRacoon's picture

Running on fumes!  Problem is those vapors are flammable....

The dollar is the fuel just waiting for a spark.

Wed, 11/10/2010 - 10:45 | 716088 Josephine29
Josephine29's picture

This is interesting because most of Mr.Rehn's pronouncements have turned out to be absolute rubbish....

I have also spotted that there is more discussion of the flaws in the Euro zone's rescue mechanism. According to notayesmanseconomics.

Perhaps worst of all errors has been the so-called shock and awe weapon or EFSF. It was apparent to me from the beginning that it was not well designed or conceived as I wrote on the 10th of May.

Perhaps that is the real reason Ireland has not called on it.

http://notayesmanseconomics.wordpress.com

Wed, 11/10/2010 - 10:49 | 716102 johngaltfla
johngaltfla's picture

The 100 Mt bomb ready to go off....tick, tick, tick, tick....

Wed, 11/10/2010 - 10:51 | 716108 jus_lite_reading
jus_lite_reading's picture

So it was predicted, so it will be done...

Wed, 11/10/2010 - 11:06 | 716161 lizzy36
lizzy36's picture

Looks like CME not the only one changing margin requirements. 

LCH.Clearnet changed the margin requirements for Irish Bonds this morning (which may or may not matter as one assumed that the ECB had most of these bonds on its books either directly or through repo, but i digress):

Dear RepoClear Member,

1. In accordance with the Sovereign Risk Framework issued on 5 October 2010, LCH.Clearnet Ltd has revised the risk parameters for Irish government bondscleared through the RepoClear service. The margin required for positions of Irish government bonds will consequently be increased by 15% of net exposure. This will also apply to Irish government bond exposures in the single ‘A’ €GC basket. LCH.Clearnet will continue to monitor the situation closely and keep the parameters under close review.

http://ftalphaville.ft.com/blog/2010/11/10/399916/revised-risk-parameters-for-irish-government-bonds/

Wed, 11/10/2010 - 11:12 | 716182 Minyan Vince
Minyan Vince's picture

welcome to why the Fed actually did QE2...to save europe and avoid an April-July replay

Wed, 11/10/2010 - 11:28 | 716285 TBT or not TBT
TBT or not TBT's picture

I don't want to end up a bitter paranoid kook over it, but it is looking that way to me.  

I placed my bets on the Euro tanking as soon as the rioters got settled back into their usual bitterness after their August 2010 vacations.   The Euro debacle should have then taken our stock market with it.   But Ben and company read my mind, and to thwart me made their Jackson Hole statements and did their backdoor help to Spain and other EU basketcases, specifically to ruin MY plans.  

I got poorer along with everyone else who didn't simply bet on the endgame itself:  precious metals and/or commodity plays, rather than shorts on stuff that should rightly have tanked spectacularly by now.

Wed, 11/10/2010 - 11:15 | 716194 AlienTrader
AlienTrader's picture

That snapshot is taken from bloomberg professional, right? Does anyone know how much is the monthly fee for this service?

Wed, 11/10/2010 - 12:19 | 716547 firstdivision
firstdivision's picture

Last I heard was $1500/month, but maybe they will strike a deal for $1450/month if you sweet talk the sales rep.

Wed, 11/10/2010 - 15:14 | 717227 37FullHedge
37FullHedge's picture

Ireland is bust However ireland was the first to act by raising taxes and cutting spending, I think they my pull it off if they are bailed out and the Euro falls to par with the USD

 Spain is the real problem its big and for me thats the shoe that will possibly break up the Euro which would be nice But I am sure the globalist elite wont under any instance let the Euro fail so welcome to the United states of Europe and the names Ireland and Spain are no more.

Wed, 11/10/2010 - 19:45 | 718176 johngerard
johngerard's picture

Ireland embarks on "quantitative cheesing" program:

http://www.guardian.co.uk/business/2010/nov/05/ireland-recession-let-them-eat-cheese

 

 

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