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Trichet: "Strong Vigilance" Needed, ECB Raises 2011 Inflation Range From 2.0%-2.6% To 2.5% to 2.7%; July 1.50% Rate Hike Coming

Tyler Durden's picture




 

Soundbites from the Trichet conference:

  • TRICHET: ECB SEES "UPWARD PRESSURE" ON EURO AREA INFLATION
  • TRICHET: COMMODITY, ENERGY COSTS DRIVING PRICE PRESSURES; UNDERLYING PACE OF MONETARY EXPANSION RECOVERING
  • SEES 2011 INFLATION AT 2.5% TO 2.7% VS PREV 2.0% TO 2.6% *TRICHET SAYS HIGHER INFLATION FORECASTS REFLECT ENERGY COSTS
  • TRICHET: "STRONG VIGILANCE" NEEDED ON INFLATION RISKS; ECB WILL ACT IN FIRM AND TIMELY MANNER; ECONOMIC UNCERTAINTY REMAINS "ELEVATED"
  • TRICHET: UNDERLYING PACE OF MONETARY EXPANSION RECOVERING; MONETARY STANCE IS "ACCOMODATIVE"
  • TRICEHT: GREECE NEEDING ABOUT EU45B OF NEW LOANS; GREECE WILL GET EU57B OF LOANS UNTAPPED FROM 2010; RAISE EU30B FROM ASSET SALES THRU '14
  • TRICHET: ECB TO SECURE FIRM ANCHORING OF PRICE EXPECTATIONS; ECB "WILL DO ALL THAT IS NEEDED" ON INFLATION
  • TRICHET: NON-STANDARD MEASURES ARE TEMPORARY
  • TRICHET: ECB TO KEEP FIXED RATE ALLOTMENT TENDER FOR 3 MONTH LTRO OPERATIONS FOR Q3
  • TRICHET: ECONOMIC ACTIVITY EXPECTED TO BE SOMEWHAT DAMPENED BY BALANCE SHEET ADJUSTMENT

The EURUSD chart looks like an EKG:

EURUSD now tumbling:

 

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Thu, 06/09/2011 - 08:46 | 1354062 Caviar Emptor
Caviar Emptor's picture

Tyler did you see this? 

German rating agency Feri downgrades US debt to AA. First western downgrade of US debt now a fact (!)

LINK

Thu, 06/09/2011 - 08:51 | 1354074 cossack55
cossack55's picture

Damn Germans. First they bomb Pearl Harbor and now this shit.

Thu, 06/09/2011 - 08:52 | 1354075 Caviar Emptor
Caviar Emptor's picture

In their comments: 

“Our rating system shows a deterioration in economic health, so the downgrading of the credit ratings of U.S. is warranted.”

Thu, 06/09/2011 - 08:52 | 1354078 bigdumbnugly
bigdumbnugly's picture

yeah.  i'm responding by first boycotting all their comedians.

Thu, 06/09/2011 - 09:02 | 1354101 SheepDog-One
SheepDog-One's picture

German comedians, OY VEY dont get me started!

Thu, 06/09/2011 - 08:59 | 1354095 Cast Iron Skillet
Cast Iron Skillet's picture

Feri was apparently not high enough on the pay off list

Thu, 06/09/2011 - 10:03 | 1354241 Terminus C
Terminus C's picture

Damn Germans. First they bomb Pearl Harbor

Proxy war bitchez!

Thu, 06/09/2011 - 10:32 | 1354313 anyways
anyways's picture

+10

best comment i read today. LOL from Germany.

 

 

ps. but the Japanese did bomb Pearl Harbor :)

 

Thu, 06/09/2011 - 09:30 | 1354159 falak pema
falak pema's picture

that's a bad cucumber company rating...they are not happy about cucumbers in Hamburg...They suspect now those cucumbers were imported from the US!

They are as clueless as Trichet today!

Thu, 06/09/2011 - 09:35 | 1354170 Stuck on Zero
Stuck on Zero's picture

Those cucumbers weren't intended for human consumption.  They were sold "for entertainment purposes only."

Thu, 06/09/2011 - 09:50 | 1354209 Ahmeexnal
Ahmeexnal's picture

So they've been lying all this time? It's not E. coli but a super Chlamydia strain?

Thu, 06/09/2011 - 09:48 | 1354215 carbonmutant
carbonmutant's picture

LOL

Thu, 06/09/2011 - 08:45 | 1354072 Cdad
Cdad's picture

All ZH members should now prepare for the totally depraved, foaming at the mouth, lubed up, father raping USD studman to enter the scene and have his way with every living thing, especially every living fund manager that did not sell down his equity portfolio because he thought everything good was pixie dust powered, and everything bad was just "transitory."

Welcome to the US summer of recovery and discontent.  Fasten your seatbelts and put your helmets on.

 

Thu, 06/09/2011 - 09:06 | 1354103 spanish inquisition
spanish inquisition's picture

Well you can't blame Bilderberg. They were all in a meeting when this happened.

Thu, 06/09/2011 - 09:08 | 1354107 Re-Discovery
Re-Discovery's picture

Of course they were.  Didn't you see that earpiece Trichet had on (and the less obvious electrodes on his balls.)

Thu, 06/09/2011 - 09:06 | 1354104 SheepDog-One
SheepDog-One's picture

Exactly, what else can you really do except buckle up and watch the show?

Thu, 06/09/2011 - 09:09 | 1354110 Cdad
Cdad's picture

What else?  You can sell those stocks that have ignored every last flashing warning sign and are sitting a ferry wing's length from all time highs because the last algo bidding them up is wearing a hockey helmet and standing in the center of the room clapping for himself.

 

Thu, 06/09/2011 - 09:09 | 1354117 SheepDog-One
SheepDog-One's picture

Only problem I see with being in there shorting pigmen stocks is one of these mornings theyll likely just turn out the lights in the casino, throw covers over the tables while firing machine guns over everyones heads yelling 'GAME OVER! GET OUT'!

Thu, 06/09/2011 - 09:33 | 1354137 Cdad
Cdad's picture

Barring any machine gun toting Federal Reserve Bankers bursting onto the scene [curbs in] and blazing away, I rather think we are removed by some measure of time from that eventuality, notwithstanding the potential for your scenario to play out.

I rather think, brother Dog, that you should be much more concerned about the totally pissed off, lubed up, frothing at the mouth, father raping USD studman who has just entered the room.  He seems imminently more threatening.  I hope no ZH brothers are currently wearing assless jeans.

FUBAR baby!  The US economy cannot live on algos alone, Bernanke's "wealth effect" aside.  And this point is lost on who again?  Oh yeah, criminal syndicate Wall Street bankers.

 

Thu, 06/09/2011 - 09:39 | 1354173 SheepDog-One
SheepDog-One's picture

Damn straight, US cannot live on liquidity pumping algo robots alone. 

Thu, 06/09/2011 - 09:40 | 1354174 Caviar Emptor
Caviar Emptor's picture

The US economy cannot live on algos alone,

The day after the human race has ben wiped out by biological weapons, the algos will open Wall Street higher. And tick on care free through the days until the last of the residual power in the grid is finally expended. 

Thu, 06/09/2011 - 09:42 | 1354187 SheepDog-One
SheepDog-One's picture

Soon the algos are going to start building T-1 terminators on evenings and weekends.

Thu, 06/09/2011 - 08:50 | 1354076 Racer
Racer's picture

It maybe that range for him, but certainly not for me! I wish it was as low as that!!!

Thu, 06/09/2011 - 08:55 | 1354082 Re-Discovery
Re-Discovery's picture

Race to the bottom, folks.  Hope everybody has their alternative currencies firmly in hand.

Thu, 06/09/2011 - 12:44 | 1354820 thriftymost
thriftymost's picture

Already thought of.  I get paid in redbacks.  Chairman Mao almost managing a smile on each and every note--better than gold!

Thu, 06/09/2011 - 08:58 | 1354086 A Man without Q...
A Man without Qualities's picture

My guess is it's a head fake.  The Euro area is more at risk from deflation than inflation, or rather deflation in the asset prices the banks are most exposed to.  

As for oil prices, how is raising rates going to defeat Gaddafi?

Thu, 06/09/2011 - 08:58 | 1354087 Iriestx
Iriestx's picture

The quickening collapse of western civilization is very bullish for equities, I hear.

Thu, 06/09/2011 - 09:03 | 1354096 gigeze787
gigeze787's picture

EUO (2x euro short) volume is surging pre-market. It has traded 14% of normal 10-day volume by 0900ET/1500CET. Big blocks. The big players don't seem to be buying the ECB's 'tough guy' pre-conference hype.

Thu, 06/09/2011 - 09:14 | 1354123 Ray1968
Ray1968's picture

Wow, the EUR/USD just got very twitchy!

Thu, 06/09/2011 - 12:52 | 1354840 thriftymost
thriftymost's picture

My own volume analysis gave a clear sell signal on EUR/USD a full two hours ahead of the Trichet speech--or whatever that silly news blip was.

Not so "twitchy" at all when you've got a leading indicator.

Thu, 06/09/2011 - 09:06 | 1354108 SheepDog-One
SheepDog-One's picture

Oh well...at least none of us can gripe we lived in boring world times!

Thu, 06/09/2011 - 09:12 | 1354113 Caviar Emptor
Caviar Emptor's picture

Flash back to musical lyrics that were hip in America in the days of the Depression (and fast becoming relevant today):

Got no diamond, got no pearl,
Still I think I'm a lucky girl.
I've got the sun in the morning
And the moon at night.
Got no mansion, got no yacht,
Still I'm happy with what I got.
I've got the sun in the morning
And the moon at night

Sunshine gives me a lovely day,
Moonlight gives me the Milky Way.


Got no checkbooks, got no banks,
Still, I'd like to express my thanks.
I've got the sun in the morning
And the moon at night.

Got no silver, got no gold,
What I've got can't be bought or sold.
I've got the sun in the morning
And the moon at night.

Sunshine gives me a lovely day,
Moonlight gives me the Milky Way.


 

Thu, 06/09/2011 - 09:20 | 1354129 SheepDog-One
SheepDog-One's picture

I like this depression era song better

YES we have no bananas, we have no bananas todayyyyaaaayyyaaaay!!

Thu, 06/09/2011 - 09:28 | 1354147 gmrpeabody
gmrpeabody's picture

And I was thinking I couldn't laugh this early in the morning.

Thu, 06/09/2011 - 09:25 | 1354150 Caviar Emptor
Caviar Emptor's picture

Also "Life is Just a Bowl of Cherries" and "We're in the Money!" 

Thu, 06/09/2011 - 09:23 | 1354130 Re-Discovery
Re-Discovery's picture

The EUR/USD action right now smacks of coordinated takedown.  Possibly to spur equity sell-off possibly to usher in QE Next.  I've expected a EUR selloff, but the metals don't seem to be buying that this means USD strength. 

If EUR remains weakens from here, could mean expect stronger dollar longer.  But remember that all paper currencies are relative so if you want to play USD strength, it may be 're-arranging deck chairs' strategy.

 

Thu, 06/09/2011 - 09:31 | 1354155 Caviar Emptor
Caviar Emptor's picture

The left hand giveth (Euro takedown) as the right hand taketh away (German rating agency downgrades US government bonds)

Thu, 06/09/2011 - 09:24 | 1354136 Racer
Racer's picture

Closely monitor the situation...   =

rabbit in headlights

watch the building burn

Thu, 06/09/2011 - 09:22 | 1354142 lizzy36
lizzy36's picture

And Trichet says all we need to know about Greece:

"We do not support voluntary roll over" due to (my edit) "ECB does not intend to role over their debt".

In others words, one can come up with all the euphemisms one want, reprofile, restructure......but Greece is going to default, and the ECB is NOT going to incur haircuts/losses. So extend and pretend until the ECB can get off (until it rolls off) their Greek debt.

Thu, 06/09/2011 - 09:29 | 1354151 Racer
Racer's picture

ECB's Trichet says very important that US supports strong USD policy

Not a hope in hell with the ChairSatan in charge

Thu, 06/09/2011 - 09:42 | 1354179 SheepDog-One
SheepDog-One's picture

Only course of action Benny and the InkJets have is to print the dollar to oblivion!

Thu, 06/09/2011 - 09:48 | 1354213 Hearst
Hearst's picture

When I hear 'supports strong USD policy' I understand that to mean supports strong precious metal price suppression. 

Thu, 06/09/2011 - 11:22 | 1354500 Bay of Pigs
Bay of Pigs's picture

aka the Bob Rubin Syndrome

Thu, 06/09/2011 - 09:31 | 1354156 Franken_Stein
Franken_Stein's picture

 

I find it funny that on the one hand they constantly emphasize how interested Ben Bernanke is in a strong dollar,

but how he never takes any steps to support that claim with tangible actions, but instead does just the opposite: ZIRP + QE.

 

On the other hand rarely do they mention that Trichet is interested in a strong Euro,

Juncker even muttered the Euro is too strong,

but they pull one ECB interest rate hike after the other,

leading exactly to a stronger Euro.

 

s if they didn't know.

 

Why that is?

 

Because in Europe they already have a single currency.

Mission accomplished for the globalists there.

 

The dollar on the other hand is in the way of the North-American globalists on their way towards the Amero.

It's therefore their intention and part of their agenda to destroy the dollar.

 

You have to understand: This is not by accident. It's their plan.

 

To concentrate all wealth in the hands of a few and to destroy national currencies,

and they can achieve both goals at the same time by intentionally creating hyper-inflation in the U.S. .

 

Thu, 06/09/2011 - 09:44 | 1354183 SheepDog-One
SheepDog-One's picture

Right the plan is controlled demolition, not strengthening and repairing of the structure.

A lot of people have been fooled by this, like about 98% of americans.

Thu, 06/09/2011 - 09:50 | 1354216 Hearst
Hearst's picture

What was Trichet's response to whether or not he thinks the US will 'mini default?'  Something like 'certinally not'?  I'm sure he is clinging to that belief like it's the cure. 

Thu, 06/09/2011 - 09:53 | 1354217 carbonmutant
carbonmutant's picture

10%+ unemployment is one way to curb inflation...

Thu, 06/09/2011 - 10:05 | 1354244 A_MacLaren
A_MacLaren's picture

How can you tell if a Central Banker is lying?

His lips are moving and/or an official statement has been issued.

Thu, 06/09/2011 - 10:32 | 1354323 FoieGras
FoieGras's picture

If Trichet was vigilant he wouldn't waste time with these worthless 0.25 hikes. These do nothing.

Thu, 06/09/2011 - 12:59 | 1354874 Quantum Nucleonics
Quantum Nucleonics's picture

When does that Italian guy take over at the ECB?  We need some Italian monetary policy theory in action over there in the Euro zone.  That will fix things!

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