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That "One" European Bank Continues To Rely Exclusively On Fed Generosity For Dollar Funding
Earlier the ECB released its weekly USD tender operation details, i.e., the Fed swap line roll, and it appears that the same European bank that has been locked out of money markets for several weeks now continues to have dollar funding issues. The same bank that was the sole bidder for $60MM in dollar liquidity last week, and the week prior, has once again obtained dollar funding via the ECB at the fixed rate of 1.18%, which continues to be roughly 4 times richer than comparable USD Libor based rates. Why this bank is locked out of the interbank market? Why is nobody else curious about why a seemingly solvent Europe continues to need the Fed's swap lines? It doesn't matter: by 2019 the bank should be ok. After all it will have 30x leverage for at least 3 years to get its book in order. Perhaps they can also hire Dick Fuld as executive chairman and head consultant on how to generate the best IRR on ludicrous leverage levels.
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Why is nobody else curious about why a seemingly solvent Europe continues to need the Fed's swap lines?
Because the fed/ecb/imf had made such curiosity irrelevant.
If there can be no failure, it does not matter what entity is failing.
Small amounts Tyler
Indeed. Why pay 4 times market for something that you should have down the back of the sofa? Unless of course you've already checked there, the cookie jar is empty and your friends feel that if they give you any money you'll only piss it up the wall.
Basically, their funding would seem to be as stretched as that analogy.
My intel shorts and vix longs are getting so killed.
Same boat! I am sick and tired of being short...
it's getting painful.
Coming here to brag is not cool!
Bears are probably getting very nervous about this developing chart pattern.
And it is Options Expiration Racketeering Week as well.
Bears with money in short dated shorts, certainly.
Systematic strategic bears less so:
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7997910/The-backlash-begins-against-the-world-landgrab.html
The markets could perhaps start rallying now that's it's becoming pretty clear the FED will indeed step up anytime it thinks is necessary. If the DOW rises another 50 points I'm dropping my puts.
Don't drop your puts. Tyler and Denninger says the big bad fed can't do this forever. Wait a minute , Forever is a couple of more years. Drop your Puts. Dow 36,000.
time isn't on my side :)
all oktober puts :)
Hey, ya plays wid da big boyz, ya gets boint.
this is part of the lefts one world vision. its myoptic for one to view the "USeconomy"
grinding to one world currency
left, right same garbage
Could this be the Greek bank that shorted it's own cash bonds?
Sitting all in cash waiting. Starve the beast, it'll eventually come back to its senses.
I get it -- we'll lose money on each transaction, but make up for it in volume. Nice.
This funding miss is too low for a significant TBTF bank, Project Mayhem in full spin right now - BUY EM!
Or very worrisome if a TBTF bank has to go looking for this much.
Updated DOW weekly chart:
http://stockmarket618.wordpress.com
Suggestion: Stuff those charts up yer buttttttt.
All in Cash? You bet. I'll take deflationary returns on my cash rather than losses in equuity and bonds. Unfortunately, though tempted to settle in UST, I missed the recent rally, but too late to climb on board now!
WTF, I'll get it right one of these days!
What? No gold or silver? I'm just sayin'...
If you have USD, you still have a fist full of debt.
CNBC talking right now about the banks raising capitol through stock sales and how this is good for the world economy.
Huh ?
Heh! Gotta love 'em. This morning Trish 'n' Kudlow were joking about the new jobs in Michigan making lithium batteries. Money came from stimulus funds.
Trish says something about the jobs "costing" over a million dollars each.
Kudlow chimes in with that's what you get when the gov't "interferes".
Like those folks will get together on an old open corn field and make high-tech items like lithium batteries from dirt and old corn cobs, and take home their million dollar salaries. Ask Intel how much each employee's job "costs". A million for that type of output seems cheap to me. But I'm not looking to distort "facts" to make a sick joke about jobs being created in a state that desperately needs them, making a product that the U. S. could stop importing. Not to mention the coffee shop that might start up, the other businesses in the area that would see a better bottom line. And, no, I'm not in favor of any "stimulus" crap, but if we have to have it, better it do some good like this than boltster some TBTF bank, or "distribute the wealth" to somebody who has not worked for it.
Somebody will find fault with this comment and I'll get a drive-by junking for sure. It would be nice if you could give an economy-centric reply before you dash on your merry way. If you junk and run, I'm calling YOU out for the coward that YOU are.
Most of the ECB is broke/insolvent and they need the swap lines in order to continue short term funding.