ECB Responds To Cyprus, Says "Will Provide Liquidity To Cyprus Within Existing Rules"

Tyler Durden's picture


We were waiting for the ECB response, and seconds ago we got it, when the ECB uttered the magic words, saying it would provide "liquidity within existing rules." What this means is unclear, but the algos loved it and sent the EURUSD up over 50 pips higher in milliseconds. What the algos apparently don't get is that this does not account for the additional liquidity needed that would only be released if Cyprus passed the bailout vote. The last thing the ECB wants is to appear weak, and fold letting every other broke deadbeat country to demand the same equitable treatment and diluting Germany's political might. For now however, the is a move to be faded.

This is not news as the ELA was always there... and the market realized that as soon as ES hit VWAP... fading now...

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Tue, 03/19/2013 - 15:19 | 3348958 rubearish10
rubearish10's picture

Hah! CNBS stll looking around for this news! Geese!

Tue, 03/19/2013 - 15:23 | 3348992 insanelysane
insanelysane's picture

shocking on many levels </sarc>

Tue, 03/19/2013 - 15:24 | 3349004 Frozen IcQb
Frozen IcQb's picture

And now back to our regular programing...Moar QE

Tue, 03/19/2013 - 15:28 | 3349029 TerminalDebt
TerminalDebt's picture

Thursday banks open, 5 mins later banks close, 5 more mins banks declare bankruptcy.

Tue, 03/19/2013 - 15:37 | 3349086 Atlas_shrugging
Atlas_shrugging's picture

Would someone please help me with my headline sniffing algo?  It seems to not know which end is up today.  I was told all I needed to do was start one of these and I'd be minting money.

Tue, 03/19/2013 - 15:37 | 3349090 redpill
redpill's picture

And yet all Becky Quickie will want to talk about is which stock will be pumping her today.  Or something like that.

Tue, 03/19/2013 - 22:59 | 3350912 bigyimmy007
bigyimmy007's picture


Rofl. Goddamn stock-pumping whores!

Tue, 03/19/2013 - 15:50 | 3349160 ACP
ACP's picture

Good point, I'm sure a visit from Ivan the Terrible, before the banks open to the public, will empty out anything before the Cypriots even get a chance to wthdraw one "red" cent.

Tue, 03/19/2013 - 15:26 | 3349010 CClarity
CClarity's picture

UK flying in Euros to its citizens there looking increasingly wise as banks remain closed with no REAL opening date in sight, no matter what ECB, IMF, or others say. Money will be moving

Tue, 03/19/2013 - 15:34 | 3349044 ParkAveFlasher
ParkAveFlasher's picture

I wonder if the English put JUST A FEW extra soldiers (better yet commandos), ammo, weapons, supplies, and food on the big military transport planes, along with the small stack of pre-paid credit cards that more easily could have been sent to the 3500 sovereign soldiers via single-engine cessna.

What I'm saying is, very strange would it be if LARGE CARGO PLANES were sent to essentially deliver credit to only 3,500 people.

Tue, 03/19/2013 - 15:37 | 3349089 LFMayor
LFMayor's picture

maybe they were spraying contrails on the way?

Tue, 03/19/2013 - 15:43 | 3349131 Vigilante
Vigilante's picture

That's chemtrails sir...

Tue, 03/19/2013 - 15:44 | 3349135 zdk45
zdk45's picture

That caught me off guard. Well done 

Tue, 03/19/2013 - 15:55 | 3349182 LawsofPhysics
LawsofPhysics's picture

"What I'm saying is, very strange would it be if LARGE CARGO PLANES were sent to essentially deliver credit to only 3,500 people."


How much gold can one of those planes carry?  It has to return to England (London), right? If you are going to propose a consiracy theory, do it right.

Tue, 03/19/2013 - 16:07 | 3349242 ParkAveFlasher
ParkAveFlasher's picture

Gold is YOUR conspiracy theory, Oscar the Grouch!  YOU back it up.

I'm saying, there is more than meets the eye.

Right, small coins.  Because 3500 soldiers will mutiny unless they can access the islands arcades and gumball machines, DOPE.

Tue, 03/19/2013 - 16:14 | 3349269 LawsofPhysics
LawsofPhysics's picture

No, gold is my only safe store of value.  I like the dope theory.  You are correct though, it make no sense.  Why go public at all?  Just notifiy all those soldiers via the chain of command that they will have the option of being paid in cash or direct deposit to a safe bank in London. I remember recieving all kinds of confidential memos when I was AMEDD.  Something is amiss.

Tue, 03/19/2013 - 16:17 | 3349281 ParkAveFlasher
ParkAveFlasher's picture

That's my only point.  The announcement ITSELF can cause a panic. 


Tue, 03/19/2013 - 15:57 | 3349192 Red Lenin
Red Lenin's picture

No it isn't.  There is a 'round robin' RAF cargo plane that flies UK-Cyprus-Afghanistan-Ctprus-UK every day moving mail, spare parts etc etc.  Likewise there is one flying UK-Germany-Cyprus-UK and one flying UK-Germany-Northern Ireland-UK.


It it isn't pre-paid credit cards either.  It's €1M in cash in small euro notes and coins.

Tue, 03/19/2013 - 16:15 | 3349276 Pure Evil
Pure Evil's picture

Well, actually, its all the RFID chips in the CC's that caused the extra weight.

Tue, 03/19/2013 - 15:51 | 3349162 Red Lenin
Red Lenin's picture

No it isn't.  It's flying in €1M in order to make sure that there is cash to pay it's 3,000 soldiers if they can't get money from the banks by the weekend.

The 20,000 UK citizens on the island are on their own. 

Tue, 03/19/2013 - 15:59 | 3349195 ParkAveFlasher
ParkAveFlasher's picture

OK, I'm a British soldier or military person, one of 3500 or so on that island.  That euro 285,71 (1 million euros divided by 3500) is going to make or break me survival-wise, even though I already live on a base. 


Makes sense.



Better yet, I'm a British soldier, and if I don't get my euro 285,71 from the govt., I will mutiny, defect, go AWOL on an otherwise very civilized subtropical island, or otherwise abandon my post and tell the Queen to go eff herself.  Over euro 285,71. 


I'd buy that, for a dollar!

Tue, 03/19/2013 - 16:01 | 3349212 sdmjake
sdmjake's picture

Perception often times is reality. 'A Million liquid' has a nice ring to it and will placate the nervy sheep.

Tue, 03/19/2013 - 16:12 | 3349251 ParkAveFlasher
ParkAveFlasher's picture

Why make an loud announcement?  Why not just ship in supplies?  Why not just say, "no worries, your salaries will be deposited in accounts here in England and will be safe, in the meantime, take this small cash advance and hunker down."

1 million euro is a drop in the bucket.  They can just ORDER their soldiers and staff to not try to make withdrawals, and insure their accounts back at home. 


Tue, 03/19/2013 - 16:38 | 3349376 Fred Garvin
Tue, 03/19/2013 - 15:26 | 3349011 ACP
ACP's picture

No worries...the algos have created yet another inverse H&S for everyone to pounce on. Boy, do they love those patterns. Sometimes intraday, sometimes over a few days, sometimes over a couple months, like in mid-2010. Complete, absolute, artificial market.

Tue, 03/19/2013 - 15:27 | 3349026 rubearish10
rubearish10's picture

....and as we all know, the FED supplies ECB's liquidity via swap lines etc... Mentioned this earlier that Uncle Bernank will acknowledge this tomorrow. There you have it!

Tue, 03/19/2013 - 16:12 | 3349256 spastic_colon
spastic_colon's picture coincidence that the vote happened today before the fed meetings

Tue, 03/19/2013 - 16:35 | 3349355 Go Tribe
Go Tribe's picture

Yep, more QE. Circumstances not so good this time around, though,

Tue, 03/19/2013 - 15:27 | 3349025 Jacque Itch
Jacque Itch's picture

C'maaawwwwwwwn.  How has the ECB solved all of the other problems with the PIIGS in the past 3 years?  This is just the .2% Cyprus econ.  CTL-P and it's solved. 


Tue, 03/19/2013 - 15:36 | 3349082 insanelysane
insanelysane's picture

CNBS and Bagdad Bob Bloomsberg have spent 2 days telling the sheeple how all the bad news out of Cypress just doesn't matter.  However, they then start spouting how this "good" news on Cypress should boost the markets.

They must all need a shower after doing this type of work all day.

Tue, 03/19/2013 - 15:55 | 3349189 insanelysane
insanelysane's picture

News flash.  Bloomsberg just stated there was no great rotation, it was just a one time bump from all of the end of the year fiscal cliff stuff.

In other words, 1 good point is a trend whilst the nth bad point is just a single point that shows nothing.

Tue, 03/19/2013 - 22:19 | 3350809 Buck Johnson
Buck Johnson's picture

They sure are, also it's insane for the EU to pull the stunt the did and then go ahead and give them the money.  All this means is that they fear any default in the bonds and derivative markets that could lead to a chain reaction. 

Tue, 03/19/2013 - 15:19 | 3348960 russwinter
russwinter's picture

This is a red herring. From David Zervos:

The die is cast. There is no going back for the Cypriots or the Eurozone leaders. As soon as the banks open in Cyprus there will be billions in withdrawals. The question of course is – “where will the money come from?”. Well , if the parliament votes YES, then the Euros will have to come from the Eurosystem. But there is a glitch. The Cypriots have already borrowed 10b euro via the ELA and Target2. How can Mario just wire over 20 billion more (less the 10 to 15 percent haircut) for the Russians, and another 20 to 30 billion for the wealthy Greeks. What collateral will an economy with 20b in GDP post to get this cash? Unless Mario violates every collateral rule at the ECB, the Cypriot financial system will collapse even with a YES vote. style.

Tue, 03/19/2013 - 15:23 | 3348985 LawsofPhysics
LawsofPhysics's picture

Right, because they have never "violated collateral rules before".  None of these fuckers have had an ounce of fucking integrity/credibility so far, what makes you think they will now?   All paper going to fucking zero, period.

Tue, 03/19/2013 - 15:28 | 3349015 Peter Pan
Peter Pan's picture


Tue, 03/19/2013 - 15:48 | 3349151 redpill
redpill's picture

ECB will print, and then blab about sterilization.

Tue, 03/19/2013 - 16:03 | 3349219 Dan Conway
Dan Conway's picture

An illegitimate organization will print fake currency.  GREAT!

Tue, 03/19/2013 - 16:28 | 3349320 Pure Evil
Pure Evil's picture

Welcome to Club Fed.

Printing since 1913, and a proud member of Global Ponzi.

Tue, 03/19/2013 - 18:29 | 3349953 smlbizman
smlbizman's picture

cypris, the country that doesnt matter, ....yet the light it cast is big enough to expose the entire system....

Tue, 03/19/2013 - 15:27 | 3349023 Peter Pan
Peter Pan's picture

When things are serious you have to print. LOL. Let's see Draghi posture himself out of this one.

Tue, 03/19/2013 - 15:32 | 3349055 Ruffcut
Ruffcut's picture

There is a poorman, living under an overpass, waiting to tell us all "I told you so, bitchezz."

The currency will not go to zero, only to the point that they print a note of ponzi to buy up everything with value.

Perfect plan, and going as planned.

Tue, 03/19/2013 - 16:06 | 3349234 LawsofPhysics
LawsofPhysics's picture

They can only buy what is available for sale.  When the supply lines break, the world goes to war.  Same as it ever was I guess.

Tue, 03/19/2013 - 16:33 | 3349343 Pure Evil
Pure Evil's picture

So many useless eaters, so little time to dispose of them all.

Tue, 03/19/2013 - 15:43 | 3349130 Yikes
Yikes's picture

You are  correct (I don't know about going to zero).  However, first they exposed that deposit insurance is a sham.  Next, if they do provide liquidity it will the whole collateral rules is a sham and that no one should trust anything the EU, IMF, ECB, FED, or BOJ has to say. 

Rules are for suckers.  The Bankers will be protected at all cost.

Tue, 03/19/2013 - 16:19 | 3349292 michael_engineer
michael_engineer's picture

Currency will go right past zero accelerating to negative infinity and beyond!

Tue, 03/19/2013 - 15:23 | 3348990 Dr. Richard Head
Dr. Richard Head's picture

So will Thursday be the day the Cypriot banks open back up?

ON your marks.....................................

Get set.............................................


Tue, 03/19/2013 - 15:33 | 3349059 Frank N. Beans
Frank N. Beans's picture

and ....... it's gone!


Tue, 03/19/2013 - 15:42 | 3349122 semperfi
semperfi's picture

wishful thinking - big limits on withdrawls coming

Tue, 03/19/2013 - 15:58 | 3349194 1000924014093
1000924014093's picture

Yep. The banks will open on Thursday, but not more than 5% of the total account or  50 euros, whichever is smaller.


New Roolz.

Tue, 03/19/2013 - 18:33 | 3349976 smlbizman
smlbizman's picture

im thinking its gonna be more like...what do you need it for?..let me check with the manager....we will let you know in a few days....NEXT...

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