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Bernanke and Germany Wake Up to a Merda Storm
If you don't know the meaning of merda, just let your mind wander.
Bernanke and Germany Wake Up to a Merda Storm
Courtesy of Russ Winter of Winter Watch at Wall Street Examiner
The realization has been shockingly slow, but the lamestream media, such as Bloomberg, is picking up on how toxic the LTRO program has been to the merda-storm countries' banks. Today, they ran a clip on how Spanish banks borrowed LTRO funds to speculate on Spanish sovereigns at prices that are now well underwater. That's what happens when the artificial buying frenzy has come and gone. The fact that the Spanish 5-year CDS hit 500 basis points for first time, up 23 basis points, and Italy CDS rose 15 basis points on the day to 433 basis points, signals that those countries will not be able to absorb the blow of all their bankster guarantees, let alone their normal sovereign obligations.
Italian banks took €354 billion in LTRO cash and Spanish banks took around €300 billion. Portuguese bank dependence on ECB borrowing rose to a record €56 billion. So in total, these countries’ insolvent banks have now placed over €710 billion in merda collateral with the ECB. The fact that these infected banks are halting trading about every other day should also be transmitting in spades the signal that the ECB literally owns said banks and inherits their losses and their merda collateral, which has been pawned off.
There are really only four European countries that backstop all of the ECB, EFSF, etc., etc., schemes. Unfortunately, two of them are the merda-storm countries of Spain and Italy. That means all of the losses that would normally be distributed across a number of larger nations will now fall on the remaining two: Germany and France. I've been writing that key European countries are about to toss out bankster agents and proponents of even more austerity in soon-to-be-held elections. May 6 is the key date in Greece and Germany. France's first round of elections begins on April 22.
Tying all the loose ends together is Wizard of Oz Ben Bernanke's sudden attention to words like "shadow banking," "collateral" and "vulnerabilities" in his speeches. For those with an elementary ability to connect the dots, this suggests that collateral in general -- including the merda-storm variety -- has been the subject of some late-night calls during Weekend at Benny's.
And then there's Ben, the master of obfuscation and butt covering. When this crisis soon hits, Ben will attempt to disassociate the bad collateral as a European problem and nothing with which he would ever be involved. He will argue that owning several trillion in 1-2%-yielding long-duration sovereigns in a country (the US) with a 105% debt to GDP is nothing like what the ECB has done. A few years ago, a trillion-dollar portfolio of housing mortgages would've been considered a big deal. Ben should call this European ploy "nossa merda nao fede," which is Portuguese for "our shit doesn't stink." Like chickens with their bungholes ripped out, money will go into a frenzy. From the annals of history, here are some of Brilliant Ben's priceless insights. Only in the most corrupt systems would someone like this be treated like a demi-god, let alone still have a job.
There are other smoking guns. For instance, the Ministry of Truth apparatchik, Moodys, postponed its European bank ratings announcement until early May. For the Sherlocks among you, Italy was scheduled for April 16 and Spain for April 23. Additionally, rumors floated that the ECB will engage in more can kicking by buying even more Spanish and Italian bonds. Spain will sell two-year and 10-year bonds on April 19, which will verify the rumor. The shelf life of the ECB as bond buyer may be very short lived, however, because of the aforementioned German elections.
Merkel's opposition is staunchly anti-bailout, and the Germans know full well that this merda storm of debt buying just gets added to their tab at the end of a ruckus night. Spanish and Italian bondholders, which are a much larger group, will be totally aware of how the game is played, having seen how Greek private debt holders were subordinated to the ECB in the restructuring.
Other clues: the increasing sound and fury from money managers who went along for the ride and now realize this constant central bank exposure doesn't work. First, Barton Biggs washed his hands of it this week, then Michael Steinhardt and Pimco's El-Erian. The chorus on this script keeps building because these guys are the dot connectors, and their lawyers are advising candor now, before the pitchforks arrive. It reminds me of Angelo Mozillo's after-the-fact warnings on housing just before that merda storm blew. This hurricane is even worse: The Central Banker Demi-God Bubble. Don't get too cute on the timing either, as Herb Stein’s Law is in full alert: "If it isn’t sustainable, it will end." In this case, we're talking about the system itself.
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IranWar will burst all bubbles. My "money" is on late August/early September. Remember, Netanyahu wants to liquidate both Iran AND Obama.
He's half right anyway.
That it is unsustainable is a given!
But the big question is when will it crash?
When the financial system crashes what will rise in it's place?
Price controls, capitol controls, executive orders and 450 million .40 SW rounds controls.
What bette way limit other ammunition by pricing the alternative ammo (9mm, 45acp) out of production. You will know the government is serious when they also do the same with rifle ammo. 5.56 or 7.62mm????
It is IMPOSSIBLE to rekindle “animal spirits,” living on George Orwell’s Animal Farm—where “all animals are equal, but some animals (pig banksters) are more equal than others.” Ten thousand banksters deserve to be in maximum security prison.
But Wall Street banksters pay protection money to politicians, so we have a loss-of-trust and a shitty economy. I call this a lousy tradeoff.
Prison is expensive. Ten thousand ropes are much cheaper.
Hey, this is austerity. We can reuse the rope. Hang, release, repeat.
True, but with recycling, less are required.
Better yet. Five years working in China building i-Pods in one of the factories they helped finance. The sheep will get some more cheap gadgets out of the deal, and the bankers will all off themselves before the five years is up.
sobering
For you Spanish speakers, the Portuguese and Italian word merda (shit) is spelled mierda.
Spanish --> Mierda
Portuguese --> Merda
As in Voce esta Falando Merda
http://www.portuguesedictionary.net/index.php?q=merda
maybe hinting at portugal creeping up as well.
or French...merde.
I thought there was either a spelling or a syntax problem in using 'merda storm' but the drift was easy.
finally, an explanation...i read the entire article, wondering, this merda, ... what the hell is it ???
half-way through!
"nossa merda nao fede"
Ilene, your language in this article is quite 'blue'
..but no matter, it was very well directed and i chuckled from start to finish.. good stuff :)
Ilene is a pro, not sure is she is an actual editor of Mr. Durden's articles as her site is a bit ambiguous on that point:
http://ilene.typepad.com/cycle_editing/
It's a good thing all this can be solved by printing more Euros.
I know you're kidding. But for the record it has to be said that there simply is NO solution other than a RESET and a currency reform.
Sorry, paper wealth will get destroyed. Much of it. Unless the cash is tied up in tangibles of any sort, the money will get crushed.
Those bitches in "Real Housewives of XYZ America" better get their money out into something tangible. But then again on second thought, I'd rather watch those bitches go for broke and line up at the soup kitchens like the rest. They're too stupid anyway to GET IT.
Print.... Print..... Print.... Print..... Print.... Print..... Print.... Print..... Print.... Print..... Print.... Print..... Print.... Print..... Print.... Print..... 'CRASH!'
very cushy job being a Central Banker and 'problem solver' ...until the very last bit anyways
This is all they teach you for a Princeton Phd in Ecomonics for $200k?
Answer key
A print
B all the above
his phd is from mit but your point is well taken.
Nay, they just take their billions and run. No government is going to go after the banksters.
Thats why the government has to be replaced - with nothing. Perhaps at the end of this people will begin to wake up to the fact it is democratic socialism that has facilitated all this wealth transfer to the 1%
While there continues to be plenty of other peoples money to spend, then the media will continue to love politicians - as will all corporations able to coerce, bribe or bully those with access to the cash. The number and complexity of laws and regulations will continue to increase and the percentage of money redirected to the pursiut of waste will continue to rise.
There is only one legitimate purpose for government, and that is to protect the property of the people (which includes their own body, mind, speech, labor and liberties of travel, association and contract) - its time government was either cut to the bone, or simply cut out like the cancer it is.
unless it's tangible, those billions are worthless
walkure
here here....I don't see dead people buy I do envision 500 trillion dollar bills blowing through the gutters in the near future...I could be wrong about the number of zeros but it is quite a few...
They will be burning them for heat.
Merda chips burn for heat.
All you fuckers are missing the point
The cocksuckers are printing themselves HUNDREDS of QUADRILLIONS of dollars, while the rest of us are eating merda
and, name one good reason all this should not end violently