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As Sliding EURUSD Takes Out Friday Lows, Market Response To Bailout Is "Concerning"

Tyler Durden's picture





 

Despite its illiquidity, The FX market has been the first and earliest indicator of how the market is taking the Irish bailout. So far it has been a complete abortion, and after opening in the mid 1.33 in the interbank market, the EURUSD has just touched on 1.3196, and is about to take out Friday support. The vigilantes refuse to go away. In addition to LCH margin hikes on Portugal and Spanish bonds tomorrow which now appears inevitable, we continue to expect that FX margin requirements will be hiked over the next few days across the board. Lastly, expect to hear rumors of secret service chasing any and all bond shorts/CDS longs. The war for the Eurozone's survival is now on in earnest.

 


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Sun, 11/28/2010 - 20:44 | Link to Comment Uncle Remus
Uncle Remus's picture

Remember, remember the month of November

And the relentless treason and plots

I know of no reason

Why global economic treason

Should ever be forgot

Sun, 11/28/2010 - 20:51 | Link to Comment AUD
AUD's picture

Gold sliding down too. Looks like Mr Buckler's 'risky' UST's are not quite risky enough eh ZeroHedge!

Sun, 11/28/2010 - 21:19 | Link to Comment cyclemadman
cyclemadman's picture

I personally am betting on thousands of years of human history vs. pretty printing on paper.

Sun, 11/28/2010 - 23:13 | Link to Comment omi
omi's picture

I've said this many times, every country with gold-backed currency went down. It's not the case of paper vs gold, but rather of political diligence so to say. Revolutions suck regardless whether you have gold-backed or fiat currencies.

Sun, 11/28/2010 - 23:43 | Link to Comment tmosley
tmosley's picture

Every country fails.  The only question is whether or not the citizens of that country lose 100% of their purchasing power or not.  Those who had gold did not.

Maintaining a gold standard leads to more stable governments as well.  The Byzantine Empire was a notable example.  In fact, if you look at all of the long lived empires of the world, a gold or silver standard was in effect for all of them.  When they switch to paper, they have at most 80 years until they collapse.

Mon, 11/29/2010 - 01:57 | Link to Comment dnarby
dnarby's picture

There you go again, trotting out these things they call 'facts' again...  Stop doing that, it really screws up the propaganda.

Sun, 11/28/2010 - 21:46 | Link to Comment Spitzer
Spitzer's picture

Do you really think a five minute chart is going to change gold's long term trajectory and the dollars long term trajectory ?

Even the dollar bounce in 2008 did not change any long term trends.

Sun, 11/28/2010 - 21:51 | Link to Comment AUD
AUD's picture

You evidently missed the Privateer article & thus the gist of my post.

Mon, 11/29/2010 - 01:27 | Link to Comment RockyRacoon
RockyRacoon's picture

Can you quote the projected time line on that?  No? 

That's because there wasn't one.  These things take time, and you seem to be fixated on an hourly charting time frame.   Loosen up a little.

It's not the Privateer's statement that has you rattled.  What's the true reason?

Sun, 11/28/2010 - 20:51 | Link to Comment Xibalba
Xibalba's picture

Must love China

Sun, 11/28/2010 - 20:52 | Link to Comment Wily Wonka
Wily Wonka's picture

EUR falling and tepid retail sales = BOOMING SPX FUTURES!

It's all manipulated for your pleasure!

Sun, 11/28/2010 - 21:47 | Link to Comment HarryWanger
HarryWanger's picture

Market here only cares about weekend sales and they were NOT tepid, actually pretty decent. That's why futures are up.

Sun, 11/28/2010 - 22:03 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

Sales may be up a bit, but margins are way down.  As a result, I doubt that retailers are going to be making much, if any progress on earnings.  Besides, how does retail help the USA improve its trade balance and bring unemployment down?

Sun, 11/28/2010 - 22:15 | Link to Comment Hedge Jobs
Hedge Jobs's picture

easy to buy christmas presents when you dont pay your mortgage Harry.

Mon, 11/29/2010 - 05:59 | Link to Comment John Law Lives
John Law Lives's picture

I am growingly convinced that you are not a real person.  You are a robo-drone who is programmed to post messages contrary to the tone of this site.

Good job, robo-drone.  Thanks for the comic relief.

Sun, 11/28/2010 - 20:52 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

But double Pomo tomorrow. Sounds like a dirty movie. Like getting screwed from both ends.

Sun, 11/28/2010 - 20:59 | Link to Comment westboundnup
westboundnup's picture

It feels like we're in a porno.  Can we call it "The Dirty Thirties Redux?"

Sun, 11/28/2010 - 21:06 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

It feels like we're in a porno.

Don't forget to wear your rubbers........duckie.

Sun, 11/28/2010 - 22:38 | Link to Comment FEDbuster
FEDbuster's picture

With fluffers and jizz moppers, too!

Sun, 11/28/2010 - 21:03 | Link to Comment rubearish10
rubearish10's picture

Yes, a potential stick save forecast for tomorrow but lately, it's (POMO action) playing second fiddle to the "kick the can" muff in Europe!!! WOW! this should be fun!

Sun, 11/28/2010 - 20:53 | Link to Comment Cone of Uncertainty
Cone of Uncertainty's picture

Bernanke is diddling himself to this news.

Sun, 11/28/2010 - 20:56 | Link to Comment Gordon Freeman
Gordon Freeman's picture

Man, that is some freaky imagery--my compliments! LOL

Sun, 11/28/2010 - 20:54 | Link to Comment Cone of Uncertainty
Cone of Uncertainty's picture

I must just fire up my Bloomberg Anywhere in order to watch this spectacle in real time.

 

 

Sun, 11/28/2010 - 20:55 | Link to Comment Wily Wonka
Wily Wonka's picture

Anyone have a entry point to short CMG?

Sun, 11/28/2010 - 20:56 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

Yeah record high Friday.

World falling apart and this is a safe haven.

Sun, 11/28/2010 - 20:59 | Link to Comment RoRoTrader
RoRoTrader's picture

I'd be really fucking concerned too, especially if I knew $20 odd billion Euros of my real money savings/pension fund money was being put up as part of a bank bailout and getting a ZERO fucking rate of return and everyone else in the deal who also happen to be the assholes making it all up out of 'thin air promises' were being paid a whole lot more for a whole lot less.

Bottom line; the Bloomberg so-called Ireland WINs Big spin can't pass the smell test.

In the Irish language that is expressed as 'fuck me'.

Sun, 11/28/2010 - 20:57 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

Come morning in Brussels, maybe the ECB will print up some Euros and then sashay on down to the exchange and buy some more with what they printed.

Though it's not clear exporter Germany will want this.

Sun, 11/28/2010 - 20:57 | Link to Comment Wily Wonka
Wily Wonka's picture

What's the end game for this all? World government? Single currency? Socialism?

 

 

Sun, 11/28/2010 - 21:04 | Link to Comment liberal sodomy
liberal sodomy's picture

I'm hoping revived Nationalism.

Portugal is on the clock.

Last one out of the euro is a rotten egg.

Time for a fresh maalox delivery to the SNB.

Sun, 11/28/2010 - 21:01 | Link to Comment mikla
mikla's picture

What's the end game for this all? World government? Single currency? Socialism?

No fair!  You were supposed to open them first!

Sun, 11/28/2010 - 22:18 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Step one, cut a hole in the box, step two, put your junk in that box, step 3, open the box......its a dick in a box.

Sun, 11/28/2010 - 21:02 | Link to Comment Al89
Al89's picture

General extremism.

Sun, 11/28/2010 - 21:49 | Link to Comment Spitzer
Spitzer's picture

The end of the Dollar/Fed

Its a long story.....

Mon, 11/29/2010 - 08:03 | Link to Comment johny2
johny2's picture

Really how can you be so brainwashed with all this information not to see that there is as much difference between Capitalism and Socialism as between Republicans and Democrats? 

Sun, 11/28/2010 - 20:59 | Link to Comment Gordon Freeman
Gordon Freeman's picture

Guess that whole Wikileaks McGuffin didn't do the trick--look out below...

Sun, 11/28/2010 - 21:09 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

So that what was in the briefcase in ronin.

Sun, 11/28/2010 - 21:00 | Link to Comment Wily Wonka
Wily Wonka's picture

Liberal S... I hope so too! It seems to me that most Americans don't and can't see what is right in front of them. Does it have to collapse first?

Sun, 11/28/2010 - 21:07 | Link to Comment liberal sodomy
liberal sodomy's picture

Best to go to practice at flea markets now so you won't be too far behind the curve.

Sun, 11/28/2010 - 21:46 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

Most Americans are living paycheck to paycheck with little or no savings so they really don't give a rats ass.

Sun, 11/28/2010 - 21:00 | Link to Comment tim73
tim73's picture

"The war for the Eurozone's survival is now on in earnest."

HAHAHAHAA! All you guys are doing, is helping the exports of Eurozone. Like last time during Greece crisis. 1.31 is a little bit high, 1.20 would be nice.

Sun, 11/28/2010 - 22:09 | Link to Comment snowball777
snowball777's picture

Be nice, or I'll buy your place and have you evicted.

http://www.viviun.com/AD-1591/

Sun, 11/28/2010 - 21:02 | Link to Comment trav7777
trav7777's picture

gold, sliding...wants to confirm the H&S?

Sun, 11/28/2010 - 21:52 | Link to Comment ruffian
ruffian's picture

still a long way from neckline 7's........somewhere around 1338...take out 1352 support and then we can begin to consider it.......all the worlds a flame and you think gold will crumble? Just because the least deseased bitch of a currency is rising? Use your head and buy on dips

Sun, 11/28/2010 - 21:02 | Link to Comment Ignorance is bliss
Ignorance is bliss's picture

I hope Gold and Silver stay down. I get paid in a couple of days, and will convert all that I can into PM. I don't believe in buying a debter currency as a hedge against the storm.

Sun, 11/28/2010 - 21:05 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

Any time gold becomes significant, governments will confiscate it, or more effective, declare it to be non property, thus de criminalizing any crowd who wants to break into a house to steal it.  Or any bank that wants to take it from security deposit boxes.

Gold can be erased of any significance any time a government wants to.  That's its great danger.

 

Sun, 11/28/2010 - 21:18 | Link to Comment AUD
AUD's picture

Gold can be erased of any significance any time a government wants to

If it could be, it would already have been. There is no danger.

Sun, 11/28/2010 - 21:48 | Link to Comment OddFieldIsStrong
OddFieldIsStrong's picture

Hmm. It had been in the past. Haven't you read history?

Sun, 11/28/2010 - 21:52 | Link to Comment Spitzer
Spitzer's picture

It was purchased by the government if you turned it in.

Why not claim your gold was stolen ? and hide it really well

Sun, 11/28/2010 - 21:56 | Link to Comment AUD
AUD's picture

I'm getting as agitated with some of these responses as Trav77. Gold is still money today fool & it always will be.

Governments may have in the past tried making it 'not money' but they have failed & thus it is still money today.

You have not only not read history you don't even understand the present.

Sun, 11/28/2010 - 21:52 | Link to Comment Shameful
Shameful's picture

Huh I didn't know the US could tell the world gold is illegal. Wonder how they will enforce it. Maybe the Grand Arme that is doing so well in its current adventures can branch out into all countries at the same time?

I know many cannot believe this but the US is not the whole world, and should the US decree gold to be illegal I expect it to spook the dollar market. Besides it's not like Americans hold gold, it's those pesky Asians. So baring a magical military tour I'm not seeing it happen.

Mon, 11/29/2010 - 01:33 | Link to Comment RockyRacoon
RockyRacoon's picture

Ever heard of tinyURLs?

http://tinyurl.com/2etbmot

Sun, 11/28/2010 - 21:05 | Link to Comment Aristarchan
Aristarchan's picture

I think Goldman may be practicing a little "political" quantum physics here...trying to have it both ways, and obviously subscribing the the "many worlds version," not the Copenhangen interpretation.

Mon, 11/29/2010 - 02:19 | Link to Comment StychoKiller
StychoKiller's picture

I just wish they'd take their "Spooky action at a distance" and cram it!

Sun, 11/28/2010 - 21:06 | Link to Comment InconvenientCou...
InconvenientCounterParty's picture

What's next? Clones turn off Faux News, open a history book and read.

At least you'll understand why conservatives are begging for gov't aid.

Sun, 11/28/2010 - 21:15 | Link to Comment Paul Thomason
Paul Thomason's picture

Let's face it Euro is getting flushed, it has started making its way to the treatment plant .

They should get 'The Ben Bernank' to helicopter in some of his monopoly money to add to their own monopoly money they seem intent on creating.

The western world is a fast track to disaster with these idiots who give onerous 'bailout' loans to countries who can't handle their existing debt.  Here let's fix your debt problem by loading you up with a truckload more debt.  I feel like I am watching the slow motion end of the world, if it wasn't bad it would be funny.  The stupidity and sleaze going around at the moment is more grotesque than my ex-wife naked.

Sun, 11/28/2010 - 21:47 | Link to Comment sgorem
sgorem's picture

All the Youtube pics were'nt that bad of her:)

Sun, 11/28/2010 - 21:08 | Link to Comment lbrecken
lbrecken's picture

Its clear that at every turn what ever these governments do is cheer by the street.  And it shows that these govt now have the markets and who invest in them in their pockets to rigg the entire game.  If not why not raise the margin on equities then?

Sun, 11/28/2010 - 21:09 | Link to Comment John McCloy
John McCloy's picture

Even if they manage the impossible which is to cram this bailout down the Irish throat (temporarily) without massive revolt or civil war the realization that playing spin the plate indefinetly with every nation and getting all to agree to a bailout and austerity is just impossible. Much simpler to just buy the dollar since the Euro will inevitably collapse and incite a war.

These are interesting times and the history is yet to be written. Me...I look at that mild uptick in black Friday sales and come to a few absolutes.
1. Trillion dollars in stimulus, billions in continued unemployment, nobody paying their mortgage and the best the Fed can achive is a 0.3% increase in sales?
2. The recovery is a decade away since Ben is rapidly approaching the end of his leash and the amount of freedoms politically he is being given now with 2 years of the inkjets running 24/7.

FASB 166/167 means capital raises for SPEs have to begin if I recall even after 2 years of delays. This is going to be a year to remember.

Sun, 11/28/2010 - 21:10 | Link to Comment Gordon Freeman
Gordon Freeman's picture

Trichet (looking at chart): I hate it when that happens!

Sun, 11/28/2010 - 21:15 | Link to Comment CrashisOptimistic
CrashisOptimistic's picture

 

>>>

2. The recovery is a decade away since Ben is rapidly approaching the end of his leash and the amount of freedoms politically he is being given now with 2 years of the inkjets running 24/7.

>>>

People are missing the logistics.  Two new Federal Reserve Board members take their seats in January.  Both are anti QE.  Ben may not be allowed to do anything more on the monetary side.

Then on the fiscal side we have a bunch of tea party bomb throwers who were elected very specifically to throw bombs, and they will be told that the first truly significant vote they have is to increase the debt ceiling.  It will not suprise me if they walk away and say no.  The SHTF that moment.

The recovery is not a decade away.  It's never coming.  Ever.  Oil production cap is behind all of this, and it's forever.

Sun, 11/28/2010 - 21:17 | Link to Comment Orly
Orly's picture

The pair is down thirteen pips and it had an abortion?  For real?

What do you suppose happens when the Japanese index scoots below 10,000 secondary to yen strength?  Oh, wait.  That's tomorrow.  I don't know whether your attention span can handle it.

A thirteen-pip abortion.  Seriously?

As hyperbolic as I've ever heard.

Sun, 11/28/2010 - 21:27 | Link to Comment Tyler Durden
Tyler Durden's picture

Probably looking at the "other" EURUSD. 160 pips from interbank open. Of course, the market is ignoring the fact that QE3, 4, 5, etc. are all just around the corner.

Sun, 11/28/2010 - 21:53 | Link to Comment Orly
Orly's picture

Oh, okay.

Sun, 11/28/2010 - 22:05 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

I think the public is losing faith in the FED.  Therefore, I wouldn't consider much further QE a given.

Sun, 11/28/2010 - 22:18 | Link to Comment ruffian
ruffian's picture

I agree  

Sun, 11/28/2010 - 23:30 | Link to Comment ruffian
ruffian's picture

if the elites didn't let blind greed interfere they would take a small haircut. it is in their own interest to do so. Diffuse some of this anger. They are fools to go for 100% whole. If this behavior continues any longer there will be no Q3, 4, 5....they wil have self distructed by then. IMHO

Sun, 11/28/2010 - 21:15 | Link to Comment RobotTrader
RobotTrader's picture

The U.S. "Bonar" is surging on the news.

 

As I predicted, the more money printed, the higher your currency goes.

Apparently, the ECB and IMF fell short.  They should have announced a $500 billion rescue package, not that paltry $113 billion...

Sun, 11/28/2010 - 21:27 | Link to Comment Orly
Orly's picture

Probably residual longs closing after the open.

That's one possibility, anyway.

Sun, 11/28/2010 - 21:29 | Link to Comment Mitchman
Mitchman's picture

1.31849....and falling

Sun, 11/28/2010 - 21:48 | Link to Comment firstdivision
firstdivision's picture

...and now it is above 1.32. 

Sun, 11/28/2010 - 21:59 | Link to Comment Spitzer
Spitzer's picture

whats gold doing in Euro's ?

And whats gold going to do in dollars when the Fed bails out California ?

 

Sun, 11/28/2010 - 21:58 | Link to Comment RoRoTrader
RoRoTrader's picture

Is that the same as Boehner?

Sun, 11/28/2010 - 22:10 | Link to Comment ruffian
ruffian's picture

looky there gold gone verticle...and with dollar "strength" ...really makes no sense at all? Robotic analysis of relationships that are fleeting make for poor investment decisions

Sun, 11/28/2010 - 21:16 | Link to Comment Paul Thomason
Paul Thomason's picture


Let's face it Euro is getting flushed, it has started making its way to the treatment plant .

They should get 'The Ben Bernank' to helicopter in some of his monopoly money to add to their own monopoly money they seem intent on creating.

The western world is on a fast track to disaster with these idiots who give onerous 'bailout' loans to countries who can't handle their existing debt.  Here let's fix your debt problem by loading you up with a truckload more debt.  I feel like I am watching the slow motion end of the world, if it wasn't bad it would be funny.  The stupidity and sleaze going around at the moment is more grotesque than my ex-wife naked.

Sun, 11/28/2010 - 21:25 | Link to Comment MGA_1
MGA_1's picture

Meh... I think the whole thing is going to continue for another year or two.  The currencies will all probably slide downwards together so probably best just to hold on to your gold

Sun, 11/28/2010 - 21:36 | Link to Comment Aristarchan
Aristarchan's picture

Goldman knows that analysis can be used in many ways to talk your own book. When things as complex, unpredictable and well...Schrodinger Verschrankung such as the Eurozone situation need massaging for popular consumption...then they know they can talk it up and down simultaneously, since many people will take their analysis and fit it almost perfectly to their own preconceived notions. That exemplifies how the Schrodinger's Cat situation that Durden mentioned is so very perfect for the Goldman model of leading the sheeples by their nose rings. They are hedged on this deal to the max.....so they can feed their subliminal bullshit to "investors," and make money either way.

Sun, 11/28/2010 - 22:26 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

A nice little pop above the resistance, but no breakout for the dollar despite what traders would like.  Blackhawk Ben will get his wish, and the game will go on as planned.  One little country to default at a time (I consider these loans a constitutional default as it is an admission of bankruptcy).  Oh, and that means gold/silver/platinum/oil costs will increase as JPM and the Fed spin their balance sheets accordingly.

Unless the working population continues to rise up and corner the silver bullion market.

Sun, 11/28/2010 - 22:50 | Link to Comment tallystick
tallystick's picture

An epic fleecing!

 

So the banks that are getting bailed out can borrow at ZIRP, but the Irish who are bailing out these banks, are getting charged 6% ????

 

 Hilariously sad.

Sun, 11/28/2010 - 22:52 | Link to Comment AVP
AVP's picture

Deleted

Sun, 11/28/2010 - 23:22 | Link to Comment web bot
web bot's picture

Just keep feeding us Nigel Farange... as the circus continues.

Mon, 11/29/2010 - 03:04 | Link to Comment jesus
jesus's picture

They need to change this site to GoldHedge instead.

 

Mon, 11/29/2010 - 03:07 | Link to Comment Orly
Orly's picture

They'll go away.  Give it a few weeks.  Say mid-February...

Mon, 11/29/2010 - 03:57 | Link to Comment BeerGoggles
BeerGoggles's picture

"Despite its illiquidity,"

 

Err..FX is the most liquid instrument around????

Mon, 11/29/2010 - 10:18 | Link to Comment buzzard beak
buzzard beak's picture

"Concerned" is such a mouth-watering word "Deeply concerned" means it's time to descend.

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