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Spain Passes Austerity Measures, As Fed's Tarullo Lies That Swap Lines Not A Bailout To Anyone, "Certainly Not Greece"
Another PIIG with massive GDP cuts coming to a Fed FX swap funded bailout trough near you. And speaking of Fed-funded FX swaps, here is the joke du jour courtesy of the NY Fed's Tarullo: "Federal Reserve swap actions not a bailout for anyone, and certainly not a bailout for Greece." What was that line from Macbeth... And yes, The Fed is definitely bailing out Europe with its FX swaps, and most certainly Greece. But at least Tarullo comforted those who have been brainwashed enough to listen to his ramblings that the Fed has no further action under consideration regarding the European bailout. Judging by our unimpressed response, the force is weak with that one.
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Just to keep it real...
Spain's unions to challenge wage cuts in court
MADRID, May 20 (Reuters) - Spanish unions said on Thursday they would challenge in the courts plans to cut wages as part of Spain's austerity measures.
http://www.reuters.com/article/idUSLDE64J0WP20100520?type=marketsNews
And suddenly it makes sense why Uncle Ben would just rather use the printing press to inflate. Maybe austerity is impossible.
We're not, I repeat, not, bailing out the Europeans with American taxpayer money.
Kalki
Help, I can no longer tell the difference between the tragedy and the diversion.
+10
Depends on if you are a red headed step child or a blond princess. Or said differently, Greece or the ECB.
I don't think the ECB is having a ball just now, nor is it necessarily in for a happy ending.
Very nice. This is the best academic distinction I could find
http://www.youtube.com/watch?v=MSVTOMkJdqs
lol, cheer up sleepy? jean.
DaveyJones - Ouch! No thanks for that. I think my ears are bleeding.
To BAIL or let FAIL. That is the question. (Wait, that's Hamlet)
Well, according to Cramer, we only have another 24 hours before we get the "all clear". Thank God.
Note to Cramer:
Please stop drinking the bong water.
LMAO!
Trust me - it aint bong water he's ingesting. Bong water doesn't have THAT much power.
NFL teams should use Cramer for the overtime coin toss given this unique power.
Spain is preparing to join the "Riot of the Month" club.
was that Shakespearean and Star Wars references in the same post?- bleedin' jesus man you are good
Congratulations to the FRBNY. The returns of your pagan USD burning ritual this morning are diminishing as we speak. Just an educated guess, but i'm going to estimate that 10 Billion US taxpayer dollars were thrown into a bonfire this afternoon.
And the Dow is down over 300 with 10 minutes to go.
Dude, they ran out of tax dollars a long time ago. Its all just paper now that just come right off the press.
"And yes, The Fed is definitely bailing out Europe with its FX swaps, and most certainly Greece. "
nonsense, greece debt is in euros and the ECB has said that they would take greek debt as collateral no matter what the rating agencies say=>the ECB bailed greece out, especially after the ECB started buying government bonds.
and you believe the ECB?
"Austerity" for the socialistias leads to red-colored terrorism.
I mean, every fucking lefty grad student in the US and abroad thinks that they're a one-person Baader-Meinhoff undermining the post-capitalist-neo-liberal-crypto-anti-Marxist regime.
And when you take away their welfare checks, they go apeshit. It's a good thing everyone hates academics in the US. Overseas, they're the priest class.
Wholeheartedly agreed
That was the best quote of the day. Very nicely formulated!!
"Blood letting does not cause bleeding, and blood-letting you certainly won't cause you to bleed."
That right there's what we call a distinction without a difference.
Austerity? Austerity!
What are we, a fucking charity?
No my son, it's come undone
now just lay back, the show is fun
OK, 5 minutes to recover (+/-) 320points. This should be fun to watch.
From Reuters (posted on Yahoo; emphasis mine):
WASHINGTON (Reuters) - Europe's debt crisis poses a "potentially serious" risk to the U.S. economic recovery because it threatens global credit markets and large American banks, a top Federal Reserve official said on Thursday.
Fed Governor Daniel Tarullo said Europe's debt woes, if not contained, could cause financial markets to freeze and spark a global crisis akin to the market meltdown of late 2008.
Until last week, Fed officials had been playing down the possible impact to the United States from Europe's turmoil.
"The European sovereign debt problems are a potentially serious setback," Tarullo said in testimony prepared for deliver to two congressional subcommittees.
Thursday marked another turbulent day in global financial markets. U.S. stocks plunged about 2.5 percent and investors fled from risky assets around the world. The euro, which this week hit a four-year low, was again under pressure.
Investors' anxiety still centers on Greece, but fears have grown that even the roughly $1 trillion emergency fund put together by the Europe Union and the International Monetary will not be enough to solve Europe's debt problems.
"Investors are aware that this package cannot ultimately relieve the need for real, and likely painful, fiscal reforms in the euro area," said Tarullo.
The remarks were an unusually detailed pronouncement on economic matters from a Fed governor who tends to focus on regulatory issues.
"If sovereign problems in peripheral Europe were to spill over to cause difficulties more broadly throughout Europe, U.S. banks would face larger losses on their considerable overall credit exposures," Tarullo said. "In addition to imposing direct losses on U.S. institutions, a heightening of financial stresses in Europe could be transmitted to financial markets globally."
To some extent, financial markets are already showing signs of increased strain, buttressing the view of those who believe the Fed will likely leave U.S. interest rates near zero percent until sometime next year.
The U.S. economy has been recovering relatively quickly since hitting a bottom in the summer of 2009. Gross domestic product, the broadest measure of total economic output, jumped at a 3.2 percent annual rate in the first quarter.
But that recovery could be pressured by a reduction in global trade if the European outlook worsens, Tarullo said.
Ted Truman, a former Treasury official who is now a senior fellow at the Peterson Institute, and who will testify to the congressional subcommittees following Tarullo, said the threat is very real.
"The risk is that the European situation will spiral out of control, spread within Europe beyond Greece and push Europe back into recession, and further damage the U.S. and global economy and financial system," he said in his prepared testimony.
>>Get those swap lines ready...more to come.
Of course. Leave it to these lilly-livered jerks to go blame it on everyone else but themselves. They'd blame it on the tooth fairy if they thought they could get away with it. But I still think that there is an element here of the US playing economic war on the Europeans.
Mitchman - re. economic war - Agreed. The captured rating agency is the Anglo/Zino assassin's weapon of choice.
Print, baby, print ...
I don't see the problem. Every country except greece can borrow money on the market. Yes, they pay 0,2-0-5% interest rates more than in the Goldilocks environment but that won't kill them. If interest rates get too high, the ECB will again buy bonds from the periphery countries.
Don't focus on the ECB's buying to the exclusion of its repos, which have helped out sovereigns and other dodgy creditors more and for longer. Watch the hands, not the face.
Ladies and Gentlemen, there will be no melt up today.
Liberty pulled the goalie.
Wow. Given what we are accustomed to, this is some finish. Wonder what the Nikkei will look like tonight?
I wonder what assets the Asians will have to sell... to meet their margin calls.
Saved by the Bell?
1071.61?
Couldn't help but think of a raging mid evil style battle happening over that 1070 level....they shed a lot of blood defending it...we shall see how they fare this weekend.
Glass Steagal now!
And I want claw backs too!
I think the more apropos line from MacBeth might be, "Something wicked this way comes."
Polonius:
Neither a borrower nor a lender be,
For loan oft loses both itself and friend
For several days I warned of EURUSD buying support as detected by my indicators - and this has been confirmed by the recent Euro break out.
The proprietary indicators I use can identify trend changes before they occur.
http://stockmarket618.wordpress.com
http://www.zerohedge.com/forum/latest-market-outlook-1