Merkel Sets Terms Of Quid Pro Quo: Tells Greece To Sell Assets, Ireland To Hike Corporate Tax Rate To Get Rate Cut Concessions

Tyler Durden's picture

Auntie Angela has finally snapped at the panhandlers begging for handouts, making it clear what the quid pro quo considerations are for interest rate concessions:


So the ball is now back in the beggars' court.

This is great news for Goldman prop traders and for John Paulson as (a non extradition) Santorini will be back on the market very soon.

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Irwin Fletcher's picture

It's great news as a precedent for Chinese developers looking to buy US state and national parks in the next decade or two.

SilverRhino's picture

That's a damn good time to start shooting.   Sell our treasures for pennies on the dollar for paper bullshit the fedgov has pissed away.   Sounds like a repeat of Russia in the early 90's.



covert's picture

the chinese have a delicate economy, confusing legal system that's unclear and loves protectionism and controversy. therefore more study is needed. this seems a little like roosevelt's new deal.


Motorhead's picture

Wait a minute, you talking about the Chinese economy or the U.S. economy?  Just checking, hehe.

Tail Dogging The Wag's picture

I think some states are already selling their assets since they cannot print money directly and they are not being bailed out yet. I don't think it will take a decade for Yellowstone, and Yosemite National Park to be ON SALE. I think we could see that happening in the very near future.

The Third World War is the elephant in the room.




sunny's picture

The Third World War is the elephant in the room.

I tend to agree, these world wars do tend to pop up in bad economic times.  I'm just not sure who we are gonna fight against.  Will this war be geopolitical or theological in nature?  Anyone?


equity_momo's picture

Historically ,the Nation state is a relatively new phenomena and undeniably helped lube the war machines of 1914 and 1939.   I dont think WW3 is between Nation states but corporations , so a more theological nature. Private armies will be vastly superior to Nation state armies.   Forget Nukes.

That said , before we have an all out World War , i suspect the US is about to get a hard-on like never seen before and will be deploying all its military muscle to divide and conquer before the Empire inevitably collapses. The rest of the World will jawbone but be continue to fight a proxy battle in the wake of the Drones.

ibjamming's picture

Are you kidding?  Who will we fight?  The Muzzies...the guys with all the oil we want/need.


They already started...Congressional Hearings into "fundamental Islam"...that's the guys trying to take down all our puppet regimes over there.  Just like they did with "Communists" and Communism. 


War IS coming...soon.

Vampyroteuthis infernalis's picture

We can repeat with the Chinese what occurred with the Japanese in the late '80s. They buy everything at high prices and the US turns around and buys everything back at pennies on the dollar.

FeralSerf's picture

WTF do the Chinese want with parks (except maybe for the Gates of the Arctic)?

They're already got America's manufacturing infrastructure.  It's time for them to concentrate on farm land.  And when American labor gets cheap enough, it might be time to transfer some of their Southeast Asian shirt assembly business to Ohio or some such.

Irwin Fletcher's picture

That's where they'll put their senior rare earth mining executives out to pasture when they retire.

NotApplicable's picture

They're probably diversifying their mining resources.


Cdad's picture

Oh for fuck sake...that's it....breakfast martini coming up.


HedgeFundLIVE's picture

lol, Tyler Durden needs a LIKE button in his comments section.

sunkeye's picture


that was funny

yeah never a feelgood when bfast of champions comes back up the down chute

Mr Lennon Hendrix's picture

sarc/ on

Germany making demands?

Who would have thought?

Mr Lennon Hendrix's picture

The threat of leaving the Euro creates a win win for Germany's singing Angel.

pendragon's picture

it's a negotiation for lower interest rates on the bailout loans

Mr Lennon Hendrix's picture

Yes because what should be done now is to cut budgets and lower interest rates!  Austerity is creating a drag on the economy, while money is shunned from bonds.  Perfect play to force money into equities.  Bernanke needs to keep selling his President's Working Group's portfolio to Bill Gross.  It's a vicious cycle!  Cut rates to negative and then it might work, yet with inflation finally confirmed maybe rates are negative.  To the Bernanke mobile!

Mr Lennon Hendrix's picture

The threat of leaving the Euro creates a win win for Germany's singing Angel, if nothing because of the comapritive safety Germany has over other troubled states.  They better get that 4k tonnes out of New York before shit goers down, though, if they want any credit.

three chord sloth's picture

Germany would lose big time if they left the Euro. The German export machine needs the PIIGS because the PIIGS keep the value of the Euro down. If Germany had to trade with the outside world in her own currency, a new deutsche mark, the cost of everything it exports would jump by at least 30% overnight. Say goodbye to those large trade surpluses.

Zero Govt's picture

Three Chord Sloth

Let's be crystal clear, Germany, as in its people and industrialists, do not "need Europe". For them the EU has been a huge wealth destroyer. 

The people that "need" Europe are the German politicians and German bwankers whose ambitions are far beyond its peoples and industrialists own needs. The usual parasites are destroying the hard work of the bulk of Germany pissing it away on vacuous grand political ambitions.

The Germans are having their wealth sapped to fund the politicos-bwanksters nonsense of a grand design for a European super-State. Pissing away money on frauds and poor countries to botch together a travesty that no people in Europe actually wants, to be ruled by some unelected marxists in Brussels. Merkel is taking a massive hit in elections as this banking/politico incompetence and stupidity is ever more patent by the day.

Lastly currency fluctuations make no difference to exports, it is pure fallacy. Whatever exporters lose from a high currency rate they gain on import prices (Germany doesn't have many natural resources). Currency makes no difference as it can be hedged nor can currency be manipulated as volumes are too large for any entity to control 

BigJim's picture


For a start, Germany was doing very nicely under the D-mark before the euro came along. So the historical evidence is against you.

Then - when you say 'Germany' would lose big time - you make it sound as if 'Germany' comprises one entity. It doesn't. There are exporters, importers, companies that sell domestically. Some would gain, some would lose. On the face of it, the shareholders of the exporting companies would gain, but on deeper analysis, their expenses go up because at the end of the day, their cheaper currency buys less, and the same applies to their employee's wages. And if they're outside the euro-zone, their increased dividends are paid in a weaker currency.

A weaker currency only benefits some groups within a currency zone, at the expense of others, and only temporarily.

Your argument is like saying - having loads of poor people in your country is a good thing, because it drags down the value of your currency, thereby making exports more attractive. Er, no, because all those poor people are poor because they're not producing value - value that could be driving down costs and raising living standards for everyone.

Zero Govt's picture

Merkel telling Greece to asset-strip and directing Ireland on tax policy is beyond the pale. What is this delusional and failing German Govt going to do next, tell the Spanish to stop having a siesta and work afternoons???

This is all driving a wedge between people and dysfunctional Govts and hastening the end of this failed Euro-socialist mission of madness

BigJim's picture

This is all driving a wedge between people and dysfunctional Govts and hastening the end of this failed Euro-socialist mission of madness

We can only hope.


Well, the 'Elgin' marbles might be a good place to start. We've already got those, so they'd save on postage.

Michael's picture

So predictable how primal urges and human nature rears it's beautiful head to protect itself from being eaten alive.

uhb's picture

its about time! no more mr nice guy /superfatgrin

pendragon's picture

just some hollow grandstanding for the electorate. merkel has had more caves than tora bora on the club med bailouts

Problem Is's picture

Who put that nerd-wanker Urkel in charge anyway?

THE DORK OF CORK's picture

Who could know that 10 years of German paper savings are entirely fictional - yet the dumb Irish still service this 64 pager.

Miles Kendig's picture

For now.  What's the word at the pub DOC?  Have a whiskey for me

THE DORK OF CORK's picture

Hi Miles

Well I'm down to once a week visits now (true sacrifice for a Irishman) - austerity and all - but when I get out I sence a kind of bewilderment with the entire post 1987 journey this bog hole has embarked on.

The entire fucking thing is  beyond absurd - if Germany increases its consumption even a little bit Ireland will all of a sudden Have the largest NOMINAL trade surplus in the EU.

Charlie Bravo's picture

That is absurd indeed.

Charlie Bravo

Miles Kendig's picture

WOW!  Once a week eh?  And the Ostest with the mostest says suffer some more!?!  Imagine the real what what turn about will be for ConRad when Ireland, God Bless her poor soul, cancels Octoberfest !!!

Remember, they're scared shitless since so many of their Ber_Nanks tier I capital is made up of nothing more than goodwill.  Makes Anglo-Irish seem purely responsible in bloody comparison!

God bless all of you DOC as Ireland is called to stand up to the German aggression that is refusal to balance capital flows.  -- :) --

Take care my friend (and my German ones as well since this whole gig is a supreme shit soup sandwich served up by these ponzimatic bankers)

Quintus's picture

Quite.  Imagine the rage in Germany when Josef Publik realises that all his pension money has been loaned over the past decade by German banks to the Irish, Greeks, Spanish etc. so that they could afford all the lovely Mercedes cars that clog the streets of the peripheral countries.

For all Angela's bluster, she knows this too.  If she pushes the PIIGS too far, into default, there will be a lot of angry and very impoverished Germans to whom she will owe an explanation.

Ireland has a very strong negotiating position in all of this.  

Fred Hayek's picture

Very strong is understating it.  Iceland's still alive after telling the IMF to screw.  Ireland has the choice of defaulting now and 3 or 4 very tough years or becoming indentured servants of the EU in a *slightly* less terrible condition but in perpetuity.  How in the world would anyone but a career politician scum not choose door number 1 instead of door number 2.

equity_momo's picture

Ireland will only survive if they leave the Euro , reinstate the punt , and then follow icelands lead. They have the cultural identity and lack of diversity (ethnic minorities) to pull that off.  More diverse nations without the political will to leave the Euro are simply going to internally combust.

caconhma's picture

Germany banks loaned huge amounts of money to PIIGS clients (the Irish, Greeks, Spanish etc.) to buy German products, knowing very well that these clients would not able to pay back.

Now, Germany demanded payments. Well, I don't think Germans will succeed getting their money back. Like it or not but these loans will be restructured following great civil unrest in PIIGS.


Quintus's picture

Exactly.  The Chinese fell into the same trap, lending the US all the money they needed to keep buying goods from Chinese factories.   I think restructuring of US debt is also the endgame for that relationship.

equity_momo's picture

Well , not really. You see , theres no "hard graft" to get out of this debt mess. Default is the end game. The Germans , if theyre not stupid , know this. So , get your pound of flesh first.  You wont get it when everyone is battling social chaos at home , so strike early.   The PIIGS WILL default.

The political elite are doing a reasonable job of making out like theres a political solution to this. There isnt. Soon it will be obvious to everyone that the Euro doesnt work and its every Nation for themselves. The Euro is toast and so are the PIIGS.

Germany too is toast , they just need to work out what they can redeem from these smaller nations first.

Its going to get very hostile soon.

serotonindumptruck's picture

Crash the Euro. Bring back the Deutsche Mark, Angela.

Max Hunter's picture

Certainly looks like a short term top in place at weekly resistance. Trend line just over 1.4 held strong.. At the same time, more PIIGS downgrades.. I'm seeing what you see... Not sure about near-term targest but pretty sure it will go down from here..

IQ 145's picture

 My goodness that would be nice; I'm short from 1.3965 as of last Friday morning. Zero loss stop in place; so no worries; but it will be interesting to see what happens.

Cdad's picture

Hat fuckin' tip to the photographer that put together that front page gallery on Libya.  Great shots.

Josh Randall's picture

Maybe this is why PIMPCO is holding so much cash