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Is It Beginning? Biggest JGB Price Collapse In Over 10 Years Triggers TSE Circuit Breakers

Tyler Durden's picture





 

Just over 4 hours ago we discussed the stunning collapse in 10Y Japanese bond yields. Since then - things have taken a very dramatic turn for the worse for bonds. 10Y JGB yields have exploded higher. The move from 32bps to 65bps triggered circuit breakers on the Tokyo Stock Exchange in JGB Futures trading as JGB prices plunged by their largest amount since September 2002. We can only imagine there is liquidations galore occurring given the massive outsize moves we are seeing in Japanese bonds, stocks, FX, swaps, and CDS. Did the BoJ just lose control?

 

Now that is a reversal!!

 

Biggest price drop in JGB Futures in over 10 years

 

Is the BoJ losing control?

 

Charts: Bloomberg

 


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Fri, 04/05/2013 - 00:54 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Heilige scheisse!  This makes me wonder if "This is it!"  Naah, because nothing since 2007 has been "it".

Fri, 04/05/2013 - 00:58 | Link to Comment Eireann go Brach
Eireann go Brach's picture

Paging Bernanke, Tokyo we have a problem!

Fri, 04/05/2013 - 00:59 | Link to Comment redpill
redpill's picture

I fucking told you Venkman, DON'T CROSS THE STREAMS

Fri, 04/05/2013 - 01:23 | Link to Comment Cult_of_Reason
Cult_of_Reason's picture

“What Japan is doing is actually quite dangerous because they’re doing it after 25 years of just simply accumulating deficits and not getting the economy going,” Soros said in an interview with CNBC in Hong Kong today. “If the yen starts to fall, which it has done, and people in Japan realize that it’s liable to continue and want to put their money abroad, then the fall may become like an avalanche.”

http://www.bloomberg.com/news/2013-04-05/japan-s-new-stimulus-may-trigger-yen-avalanche-soros-says.html

Massive panic bank runs and capital controls in Japan?

What idiot would want now to keep their JPY-denominated savings in a Japanese bank?

 

Fri, 04/05/2013 - 01:29 | Link to Comment I think I need ...
I think I need to buy a gun's picture

did anything significant happen 80 years ago today? April 5 1933?

Fri, 04/05/2013 - 01:36 | Link to Comment Pinto Currency
Pinto Currency's picture

So if they've been trying for so long without success, what is the Fed doing?

Looks like the JGB may have melted through the reactor casing - 'Abe' translated from Japanese is 'Mr. Creosote'.

Fri, 04/05/2013 - 04:24 | Link to Comment Supernova Born
Supernova Born's picture

Full retard, bitchez!

Didn't the Bernank tell them you have to buy your own bonds too?!

Amateurs, but they'll catch on.

When the entire first world is printing like maniacs and buying their own bonds we will witness full global fiat retard.

Fri, 04/05/2013 - 05:49 | Link to Comment Scarlett
Scarlett's picture

"Please don't worry."

Fri, 04/05/2013 - 06:07 | Link to Comment jeff montanye
jeff montanye's picture

"playing with fire" comes to mind.  also "juggling chain saws".  also:

clostridium perfringens is the most common bacterial agent for gas gangrene. despite its potential dangers, c. perfringens is used as the leavening agent in salt rising bread. The baking process is thought to reduce the bacterial contamination, precluding negative effects.

"is thought to".   sweet.

 

 

Fri, 04/05/2013 - 08:21 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Don't knock the Clostridium.  Many organisms in this genus are nitrogen fixers and very beneficial for the local soil ecology.

Fri, 04/05/2013 - 08:49 | Link to Comment tarsubil
tarsubil's picture

Like difficile, tetani, botulinum...

Fri, 04/05/2013 - 12:06 | Link to Comment Miffed Microbio...
Miffed Microbiologist's picture

Thanks for that L of P, I used to have a " have you thanked an anaerobe today?" bumper sticker but had to remove it after all the flip offs I got. I think people thought I was a treehugger or something.

Miffed;-)

Fri, 04/05/2013 - 16:36 | Link to Comment WhiteNight123129
WhiteNight123129's picture

A bit of profit taking on my long JGBs, printing always makes yield plunge first, it is the end of printing and /or the using of the base money which brings the yield upwards.

Japan is using massive rhetoric right now, then thye might print which is bullish for bonds first and next the bond market gets into a bear market, the first market which prints gets out of deflation first and gets its bond market in bear market first.

 

Fri, 04/05/2013 - 15:12 | Link to Comment r3phl0x
r3phl0x's picture

When every country has an infinite supply of fiat currency, price is meaningless and real resources must be be allocated by physical force. Long the US military, bitchez.

Sat, 04/06/2013 - 14:44 | Link to Comment papaclop
papaclop's picture

Wait until Mrs Watanabe starts buying gold.

Sat, 04/06/2013 - 14:44 | Link to Comment papaclop
papaclop's picture

Wait until Mrs Watanabe starts buying gold.

Fri, 04/05/2013 - 05:45 | Link to Comment smlbizman
smlbizman's picture

dochen.......this may not be it..but it is another jenga piece removed......which will lead to jenga boom

Fri, 04/05/2013 - 01:35 | Link to Comment Cult_of_Reason
Cult_of_Reason's picture

Do you know any public companies that sell wheelbarrows in Japan?

If they lose control of JPY, the demand for wheelbarrows may spike up parabolic in Japan (everyone will need a wheelbarrow full of paper money to buy a loaf of bread).

Fri, 04/05/2013 - 08:29 | Link to Comment Muddy1
Muddy1's picture

wheelbarrows????  seriously???

more like rickshaws with a beefed up suspension

Fri, 04/05/2013 - 01:54 | Link to Comment Cast Iron Skillet
Cast Iron Skillet's picture

thanks for the tip ... wouldn't have thought of that!

http://www.history.com/this-day-in-history/fdr-takes-united-states-off-g...

Fri, 04/05/2013 - 02:31 | Link to Comment Manthong
Manthong's picture

Be sure to mark your calendar for the big blowout birthday bash celebrating the Fed’s 100th on December 23.

Everybody gets a free promotional Bernanke beer bong with the Feds Logo and the inscription: “You can never have too much liquidity.”

Fri, 04/05/2013 - 02:40 | Link to Comment HD
HD's picture

"Everybody gets a free promotional Bernanke beer bong with the Feds Logo and the inscription: “You can never have too much liquidity.”

No green arrows - you were robbed. I enjoyed it.

 

Fri, 04/05/2013 - 05:28 | Link to Comment B2u
B2u's picture

The only minor think to happen on April 5, 1033 was FDR confiscated all the gold.

 

http://www.the-privateer.com/1933-gold-confiscation.html

Fri, 04/05/2013 - 06:18 | Link to Comment Fist full of CDOs
Fist full of CDOs's picture

The International Court in The Hague decided that East Greenland belonged to Denmark and rejected Norway's historical claim to the landmass

Fri, 04/05/2013 - 12:40 | Link to Comment JeffB
JeffB's picture

"did anything significant happen 80 years ago today? April 5 1933?"

---

Ooh. Glad history doesn't repeat itself.

Executive Order 6102

 

 

Fri, 04/05/2013 - 01:28 | Link to Comment I think I need ...
I think I need to buy a gun's picture

did anything significant happen 80 years ago today? April 5 1933?

Fri, 04/05/2013 - 01:46 | Link to Comment HowardBeale
HowardBeale's picture

In case nobody has responded: Of course, can you "Just Say No" to Gold? 

Fri, 04/05/2013 - 04:46 | Link to Comment Supernova Born
Supernova Born's picture

That's why the Japanese bonds sailed off the edge of the flat fiat Earth. The Japanese were spending some of their "extra" money suppressing gold.

Bernank had his fingers crossed behind his back when he gave the Japanese "helpful advice" on where to invest all their new "money".

Fri, 04/05/2013 - 12:42 | Link to Comment JeffB
JeffB's picture

please delete this duplicate.

Fri, 04/05/2013 - 01:32 | Link to Comment Pinto Currency
Pinto Currency's picture

-

Fri, 04/05/2013 - 01:48 | Link to Comment CheapBastard
CheapBastard's picture

'Run Forest, run !'

Fri, 04/05/2013 - 03:43 | Link to Comment Reven
Reven's picture

And the Keynesians are already hedging their bets.  This shit will never end until it's done.

Fri, 04/05/2013 - 01:52 | Link to Comment Wakanda
Wakanda's picture

"We used to roast Stay Puft Marshmallows by the fire at Camp Wakanda." --Ray

Fri, 04/05/2013 - 02:10 | Link to Comment Wile-E-Coyote
Wile-E-Coyote's picture

Two missing subs surface in Tokyo Bay, right get ready to detonate we have arrived in Amerika. Who could have known??

Fri, 04/05/2013 - 03:29 | Link to Comment Fish Gone Bad
Fish Gone Bad's picture

Tokyo is not my guess, it is somewhere in S Korea.  While all the world is sleeping, there is a very real problem lurking.  After a bit of "pay back" to S. Korea, Japan will be next.

I must be a retard, all I see is the possibility of failure happening all around us, all the time.  My wife thinks I am a broken record.  Since I am patient and thoughtful, I can absolutely wait this out.

Fish Gone Bad

Fri, 04/05/2013 - 03:59 | Link to Comment lolmao500
lolmao500's picture

North Koreans hate Japs WAY MORE than Americans... or South Koreans. Hell according to polls, as much as 30% of South Koreans would support NKoreans if they invaded the South. All those ROK troops are not to be trusted at 100%...

Me thinks NKorea will launch at Japan...

Fri, 04/05/2013 - 05:36 | Link to Comment Supernova Born
Supernova Born's picture

Los Angeles. Within TV helicopter view of where the ballistic missile launched on the day QE 2 was announced.

The threat the launch represented was a gift the Bernank didn't open, but instead re-gifted to the Japanese.

Fri, 04/05/2013 - 09:49 | Link to Comment stewie
stewie's picture

"Me thinks NKorea will launch at Japan..."

and rish B2 loot bags being dropped on their head?  Not a chance...

Fri, 04/05/2013 - 12:00 | Link to Comment JimBowie1958
JimBowie1958's picture

NK has long been building up for a war to conquor SK. But all military strength grows from economic strength and NK's economy is comatose at best if  not dead. People are starving while they feed the military their pecious resources and the people live in constant fear and hunger.

So they have a choice: let in capitalism and local democracy and thus reform or throw the dice and see if they can take SK and wait out Americas retaliation. They look at S Vietname as an example of a successful run at this sort of thing.

The capitalism option would involve reducing media and information control. This is problematic for NK as the people have been lied to so much in order to get them to sacrifice for the cause of re-uniting Korea under NK rule. (The only eason SK is not united with NK they say is because  the Devil Americans are holding them by force and using stooges to rule over them.) The people could very likely revolt and over-throw their government if they knew how badly they have been lied to and exploited. The NK government would NEVER risk being overthrown.

So that only leaves option number 2: throw the dice and let fate decide as time is running out and capitalism comes at an unacceptable risk of losing power.

Fri, 04/05/2013 - 08:03 | Link to Comment BoNeSxxx
BoNeSxxx's picture

"I must be a retard, all I see is the possibility of failure happening all around us, all the time.  My wife thinks I am a broken record.  Since I am patient and thoughtful, I can absolutely wait this out."

Ditto.  My wife got tired of listening to my jabbering on about the collapse too so I sent her outside to dig holes the size of coffee cans in the woods.  Now she is scattering penny nails over the dirt.  She doesn't ask quesitons and is happy to be outside.

Fri, 04/05/2013 - 08:25 | Link to Comment inevitablecollapse
inevitablecollapse's picture

last time i did that, mine tried to run away...

Fri, 04/05/2013 - 04:57 | Link to Comment Hayek FA
Hayek FA's picture

 I love this plan! I'm excited to be a part of it! Let's do it!

Fri, 04/05/2013 - 07:15 | Link to Comment NoDebt
NoDebt's picture

There is DEFINITELY a slim chance that we'll survive.

Fri, 04/05/2013 - 07:20 | Link to Comment Boeing Boy
Boeing Boy's picture

can you explain for a simple Brit?

Fri, 04/05/2013 - 15:21 | Link to Comment mkhs
mkhs's picture

Quote from the movie, "Ghost busters."

Fri, 04/05/2013 - 01:02 | Link to Comment knukles
knukles's picture

The Bernak'll send Timmah to fix it again

Fri, 04/05/2013 - 01:13 | Link to Comment Scro
Scro's picture

Timmah!

Fri, 04/05/2013 - 01:32 | Link to Comment Pinto Currency
Pinto Currency's picture

 

Timmah's a bit sore tonight.
Maybe tomorrow.

The turbo was a bit much.

Fri, 04/05/2013 - 02:17 | Link to Comment Silver Bug
Silver Bug's picture

Is the nightmare finally over?! Can I wake up yet?

 

http://jimrickards.blogspot.ca/

Fri, 04/05/2013 - 06:09 | Link to Comment Go Tribe
Go Tribe's picture

I interesting that this happens at a time when the banks crashed silver to its support levels. Almost like they wanted to get in cheap before hitting the panic button. Nah...

Fri, 04/05/2013 - 06:15 | Link to Comment spankfish
spankfish's picture

Could this be Fukashima 2?

Fri, 04/05/2013 - 01:01 | Link to Comment knukles
knukles's picture

Butcha know what?
Whatever the result, Krugman will come back recounting his nonsensical propositions stating had we listened all would be OK.

 

gotta hunch he was beat up on the school yard lots so mommy had to home school him and she beat him up, lots, too

Fri, 04/05/2013 - 01:47 | Link to Comment Hindsight2020
Hindsight2020's picture

No matter what he'll always say it wasn't big enough.  He's like the size-queen of monetary policy.  Never satisfied until he gets the motherload and I hope he chokes on it.

Fri, 04/05/2013 - 01:49 | Link to Comment EscapeKey
EscapeKey's picture

No, he's positioned himself to he can claim he was right about this one too.

He said that we need to keep a keen eye on public debts. So if the system goes down, it's because the debs are too high. If it doesn't go down, but the economy struggles, it's because we didn't print enough.

See? Krugman will claim he's right either way.

Fri, 04/05/2013 - 01:00 | Link to Comment Cult_of_Reason
Fri, 04/05/2013 - 01:19 | Link to Comment Spitzer
Spitzer's picture

Bah, Bernanke can just phone Abe and tell him how to fix this in 15 minutes.

15 minute fix

Fri, 04/05/2013 - 01:36 | Link to Comment Cult_of_Reason
Cult_of_Reason's picture

Page Timothy Franz Geithner STAT!

Fri, 04/05/2013 - 01:52 | Link to Comment CheapBastard
CheapBastard's picture

Massive moves into physical assets like oil, PMs, etc. likely to occur as the paper depreciates.

Fri, 04/05/2013 - 02:32 | Link to Comment Lore
Lore's picture

That's so passe.  The future lies in BITCOINS.  They cure ARTHRITIS and RHEUMATISM and STOP HAIR LOSS.

Fri, 04/05/2013 - 03:19 | Link to Comment varnelius
varnelius's picture

I had heard that BitCoins were the cause of gay marrige.  Sure they didnt cause the H5N9 virus as well?

Fri, 04/05/2013 - 14:11 | Link to Comment Lore
Lore's picture

The evil emperor. Appropos.

Fri, 04/05/2013 - 02:57 | Link to Comment RebelDevil
RebelDevil's picture

No shit.

Fri, 04/05/2013 - 04:39 | Link to Comment capitallosses
capitallosses's picture

Wouldn't trust a word Soros says, but you can be sure he'll pick up a few more billion on the yen trade.

Fri, 04/05/2013 - 01:05 | Link to Comment seek
seek's picture

It's not "it," but it's a hell of a lot closer to "it."

The system is a house of cards as is, and can barely tolerate Cyprus. For the past few years I've felt that Japan would be the real trigger -- Spain or Italy could do it via chain reaction in the Euro, but given how fragile and large of an economy Japan is, and how much cross-investment takes place with other economies, they're uniquely suited to cause mayhem globally.

Fri, 04/05/2013 - 01:13 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

+ 1  Hai! 

Who knows which of that sad lot would be the ones to bring us down...

Fri, 04/05/2013 - 01:14 | Link to Comment RockyRacoon
RockyRacoon's picture

I'd like to think it really is "it".  Even more, I can't wait to see what the response is by the rest of the world.

Some folks are gonna have to change their pantaloons... Bob "Piss-Ant" Pisani for starters.

Fri, 04/05/2013 - 01:32 | Link to Comment seek
seek's picture

I think it's still too early. The Fed's activities still have credibility and impact on the market in a positive way. It's over when a Fed cash injection is viewed as a bad thing rather than a necessary thing, and I think that transition in thinking will come when Russia and China are comfortable with the USD losing reserve status, which I think is around the same time I've been citing for a while, 2015-2018.

If this really is "it," you won't be able to buy gas in two weeks even with gold, but might score a gallon from your neighbor's Yukon for a few MREs..

Fri, 04/05/2013 - 01:58 | Link to Comment FoeHammer
FoeHammer's picture

Interconnectivity. The event doesn't have to start here in order to end here. I think the wildfire rate is underestimated

Fri, 04/05/2013 - 02:04 | Link to Comment seek
seek's picture

Oh, I agree -- when it goes, it will go big and go fast. I wasn't joking about not being able to buy gas in two weeks if this was "it." Based on what happened in 2008 it'll take 5 days tops to engulf the entire global financial ecosystem when "it" comes. It's just I think the US position needs to be further destabilized before we can get the kind of non-linear response that will blow the entire system up started.

The silent bank run in 2008 was positioned to take down the entire US banking system in under 8 hours (honestly, I think is was under 5) and it was clear to the Fed even with intervention (via supplying cash) they couldn't stop it. The only thing that stopped it was the increased FDIC limit. Next time it happens, I'm convinced they'll have to suspend banking, which will simply mark the point of lost control and the end of the current system, just like it did in the great depression.

Fri, 04/05/2013 - 02:22 | Link to Comment RebelDevil
RebelDevil's picture

"I think that transition in thinking will come when Russia and China are comfortable with the USD losing reserve status, which I think is around the same time I've been citing for a while, 2015-2018."

Max Keiser says that China will declare the Yuan as an alternative reserve currency, or that the Yen will crash (both of which would lead to the hyperinflation of the dollar) this month.

John Williams says the same, but for next month.

Let's hope they're both wrong, because if they're right, this may be "it".

Fri, 04/05/2013 - 02:34 | Link to Comment seek
seek's picture

That's the thing that makes nonlinear systems such a bitch, tiny variability on input has huge effect on output, so a very small variation could change the schedule of collapse by months to years.

I like John Williams work, and was even a subscriber for quite a while, but he's been banging the hyperinflation is right around the corner drum for a long, long time. And I don't doubt he'll be right, but due to the nonlinear nature, his timing has been wrong for close to five years; I don't doubt my timing is off, either, but I've derived it looking at things that have been moving linearly, too, so I think it's more supportable. I'm convinced the collapse has to happen prior to 2022, and likely no later than 2020, but I think the probability is it happens in 3 years or so. But it's anyone's guess.

Keiser, well, meh.

If either one of them is right, this will be "it." China is the #2 economy, Japan #3. If either country goes down hard or purges held foreign debt and life gets real interesting, really quick. The Treasury and Fed will have to decide if they're suspending redemption or printing cash for other economies, neither choice ends well.

Fri, 04/05/2013 - 01:13 | Link to Comment monkeyboy
monkeyboy's picture

Meh. When the Norks start lobbing nukes then I might consider that, "This is it!?!"

Until then nothing to see here, move along.

Fri, 04/05/2013 - 05:49 | Link to Comment Tompooz
Tompooz's picture

NK does not  need to lob a nuke. A launch of conventional explosives targeting a nuke reactor in Japan would give them a second Fukushima. That would certainly be "it".

Fri, 04/05/2013 - 05:30 | Link to Comment Lets Buy The Dip
Lets Buy The Dip's picture

haha, yes this is so true. 

They plan, they execute, they delay, we should all know the drill by now. 

CHECK OUT THIS CHART

You will see that The Russell has been getting pumbled the last few days, and the S&P is only down a tiny fraction. 

The last time this happened, everyone said the market would bounce, however the S&P caught up the RUSSELL can got HAMMERED! in the process. 

So the question right now is WILL the S&P play catch up with the RUSSELL and slide down quickly, my guess is that is a HIGH probability. We shall see. 

Fri, 04/05/2013 - 07:42 | Link to Comment deKevelioc
deKevelioc's picture

This is just the 'new normal'.  Get with the program, fella.

Fri, 04/05/2013 - 08:23 | Link to Comment LawsofPhysics
LawsofPhysics's picture

"Naah, because nothing since 1971 has been "it".  - FIXED.

Fri, 04/05/2013 - 00:54 | Link to Comment EscapeKey
EscapeKey's picture

That's outrageous. The BoJ should immediately step in and bid up prices! /sarc

Fri, 04/05/2013 - 01:33 | Link to Comment thecoloredsky
thecoloredsky's picture

http://www.bloomberg.com/news/2013-04-05/asian-stocks-rise-led-by-japan-...

 

“It’s a typhoon of cash globally,” said Jason Brady, a fund manager who helps oversee about $84 billion in assets at Thornburg Investment Management Inc. in Santa Fe, New Mexico. “Central banks everywhere are doing the exact same thing. You have to believe that all of this printing or all of this stimulus is actually going to lead to sustainable economic growth.

 

Fri, 04/05/2013 - 00:54 | Link to Comment drink or die
drink or die's picture

Came here to see if you caught this yet.  How long will it be halted for?

Fri, 04/05/2013 - 00:56 | Link to Comment credittrader
credittrader's picture

It's unhalted now - stil holding (price) lows.

Fri, 04/05/2013 - 00:54 | Link to Comment W74
W74's picture

It begins.  Take a look at the Hang Seng, a much better economic barometer than the Dow, Nikkei or S&P.

Fri, 04/05/2013 - 02:54 | Link to Comment MythicalFish
MythicalFish's picture

Hang "I was at 32000 in Q4'07 just after LIBOR froze" Seng?

 

IS IT A JOKE???

Fri, 04/05/2013 - 00:56 | Link to Comment realtick
realtick's picture

Fukushima

Fri, 04/05/2013 - 00:57 | Link to Comment syntaxterror
syntaxterror's picture

The Jack Sauce Orgy on the Nikkei trading floor didn't trigger any circuit breakers! Fucking pussies!!!

Fri, 04/05/2013 - 00:56 | Link to Comment knukles
knukles's picture

Could it be that a newly birthed second derivative of sharply increasing inflationary expectations have drawn the markets attention from the first derivative liquidity effect?

If so with rising as opposed to falling rates, there will be additional support for the yen on a relative income spread basis....

Broad dramatic shifts often are accompanied by large and unanticipated consequences.

Fri, 04/05/2013 - 01:41 | Link to Comment piliage
piliage's picture

I'm seeing it this way knuckles, Japan just increased their energy import prices and material costs in a country that needs to import virtually all raw materials by 30%. This gets ugly sooner than later.

Fri, 04/05/2013 - 05:18 | Link to Comment Nobody For President
Nobody For President's picture

https://www.youtube.com/watch?v=iwDDswGsJ60

 

Money for nothin', and the chicks are free.

 

Quit yer worryin knuks, what could POSSIBLY go wrong?

Fri, 04/05/2013 - 00:59 | Link to Comment piliage
piliage's picture

Kyle Bass you magnificent bastard.

Fri, 04/05/2013 - 01:06 | Link to Comment Hindsight2020
Hindsight2020's picture

If this turns out to be the tipping point it is playing exactly as he said it would, a move down followed by a dramatic rise up.  Good job getting in front of the camera today Kyle and going on the record! Serious man crush going on, love ya Kyle!  Give 'em hell and don't sell those interest rate swaps when they call again to buy them back.  What a great tell that was once again as it was in subprime.

Fri, 04/05/2013 - 01:22 | Link to Comment Spitzer
Spitzer's picture

He's a charming guy.

Fri, 04/05/2013 - 01:17 | Link to Comment Crawdaddy
Crawdaddy's picture

You just have to remember TPTB arent trying to save themselves - they are trying to crush us.

Fri, 04/05/2013 - 02:28 | Link to Comment RebelDevil
RebelDevil's picture

Well in that case, nukes are on the table.

Fri, 04/05/2013 - 01:00 | Link to Comment valkir
valkir's picture

We all know it already started.We all dont know how it will finish.We all know it wont be pretty.

Fri, 04/05/2013 - 01:01 | Link to Comment q99x2
q99x2's picture

You'll know it if BitCoin goes ballistic by the morning.

Fri, 04/05/2013 - 01:10 | Link to Comment seek
seek's picture

Mt. Gox, the largest exchange, is in Japan. It's conceivable given volumes and location and operating within the Japanese banking infrastructure that a bad enough financial crisis would actually lock up their ability to do business. So we actually can't count on bitcoin as an indictor (at least via Mt. Gox.) if things get really wild.

FYI Mt.Gox now has a backlog of over 10K accounts waiting to be opened, the increase from Cyprus and and general speculation is more than they can handle, and one of the other major exchanges was just hacked yesterday, so they're down too.

Fri, 04/05/2013 - 01:21 | Link to Comment Ahmeexnal
Ahmeexnal's picture

But....but....bitcoin encryption is IMPOSSIBLE to break? 

which reminds me of another computing milestone:

640kb ought to be enough for everybody

 

Fri, 04/05/2013 - 01:40 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

Do you know of a way to break SHA 256 encryption?
One of your cohorts mentioned the unicorn quantum computer.

Please do share how you would break the encryption.
Poke it with a stick?

Stay irrelevant friend.

Fri, 04/05/2013 - 02:11 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

Whenever I hear people talking about "quantum computers", I think of the great bar scene in Goodwill Hunting, trying to impress/intimidate others with buzzwords and catch phrases: https://www.youtube.com/watch?v=QnZ0Y4rvz6E

LMAO, lemme know when they have a real Q machine.  But keep using science buzzwords to spread FUD. /s

Q:  Have any of these self-proclaimed 'rocket scientists' ever had enough common sense to keep different amounts in different wallets?

Fri, 04/05/2013 - 03:34 | Link to Comment Non Passaran
Non Passaran's picture

Actually it's a best practice to have several Bitcoin wallets.

Fri, 04/05/2013 - 06:38 | Link to Comment Sabibaby
Sabibaby's picture

- Do you know of a way to break SHA 256 encryption?
One of your cohorts mentioned the unicorn quantum computer.

Please do share how you would break the encryption.
Poke it with a stick?

Stay irrelevant friend.

It's called shutting off the fucking computer. Who needs to crack jack shit! "all your bitcoin machines are blong to us"

Fri, 04/05/2013 - 07:11 | Link to Comment Acet
Acet's picture

One needs not break the encryption, one only needs to spread some viruses and trojans to the computers of people that have bitcoins and then execute trades from them.

Any real hacker will always go after the weak-points, not the strong ones.

Fri, 04/05/2013 - 01:32 | Link to Comment MisterMousePotato
MisterMousePotato's picture

Neither exchange was 'hacked'. Just your garden variety dos attack.

Fri, 04/05/2013 - 01:45 | Link to Comment seek
seek's picture

Actually, Instawallet was hacked 3 days ago, and they're down for the count: http://instawallet.org/

I'm not convinced the Instawallet hack was external, since over $1M in cold storage was allegedly transferred out in addition to $2M in hot storage.

Someone has some explaining to do.

Also, six days ago, Mercado Bitcoin, the largest exchange in Brazil, got hacked as well. Dwolla and Mt. Gox had DDoS attacksin the past week, but only service was compromised. Many other bitcoin services have reported short-term DDoS attacks the last couple months, and I strongly suspect both that and the exchange hacks are coordinated by the same entities, and would not be at all suprised to find out that the exchanges were compromised months ago and the hackers sat on them until it was a good time to strike.

Do NOT leave bitcoins on an exchange unless making a transaction within a few minutes, period.

Fri, 04/05/2013 - 01:50 | Link to Comment EscapeKey
EscapeKey's picture

It's a good thing there aren't any scams in government sponsored banking
OH WAI

Fri, 04/05/2013 - 01:57 | Link to Comment seek
seek's picture

I LOL'd.

At least with bitcoin you can take the money offline and it's guaranteed to not get inflated away beyond the established rate, so the only real risks are exchange rate and losing the internet.

I think the hacks ultimately are a good thing -- per NNT's "Antifragile," they result in the bitcoin infrastructure becoming stronger and more resistant to attack. It's just the scale of tham that sucks so much now. It used to be a hack resulted in the loss of the monetary equivalent of a pizza, now even small hacks are $1M+.

Fri, 04/05/2013 - 01:36 | Link to Comment Alpha Monkey
Alpha Monkey's picture

Exchange hack does NOT equal bitcoin hack.   But, I'm glad my account is old, guess I just need to fund it now.

Fri, 04/05/2013 - 01:47 | Link to Comment seek
seek's picture

Bitcoin's encryption is not conventionally breakable by our current understanding of the laws of physics and computation.

In every single instance of a bitcoin hack, it's been a conventional attack on servers, compromising them and spending the bitcoins that have private keys stored on said server.

It's no different than credit card hacks where someone snarfs up JC Penney's database and sells it to Russians that peicemeal out the numbers and scam online stores with.

The key, pardon the pun, here is to never, ever, store your bitcoins in an exchange. Keep your private keys on a client on your PC, and don't keep more bitcoins on those keys than you can afford to lose -- store the keys ones you want to keep in a cold wallet, offline. Just like gold in a MF Global account.v. gold in a safe: if your keys aren't offline and in your possesion, you don't own it.

Fri, 04/05/2013 - 07:17 | Link to Comment Acet
Acet's picture

+1 Most knowledgeable advice all week!

PS: SHA-256 might have weaknesses not yet found, plenty of other encryption and hash algorithms in the past were defeated when new cryptographic analysis techniques were invented. Other potential weaknesses relate to things like random number generators which aren't as random as people taught. For now, there is no widelly known weakness in it.

Fri, 04/05/2013 - 13:13 | Link to Comment Z'
Z''s picture

This article from Wired has some insight into the current govt attempts to break encryption.

http://www.wired.com/threatlevel/2012/03/ff_nsadatacenter/all/1

Read from:

There is still one technology preventing untrammeled government access to private digital data: strong encryption...

Fri, 04/05/2013 - 05:21 | Link to Comment Nobody For President
Nobody For President's picture

Well, it SHOULD have been, but somebody got greedy.

1 Mhz 65CO2 BiTCHez!

Fri, 04/05/2013 - 01:02 | Link to Comment mjorden
mjorden's picture

LONG - Shovels, Wood, Seeds, Water Well, Beans, and Land.  BUY This F*CKING DIP ... 

Fri, 04/05/2013 - 02:15 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

+1 because we'll all need the "stuff of life" a lot sooner and more often than bits of shiny metal, if the outcome or the Reset is "chaos".  And I give chaos a 1:4 chance over other possible outcomes.  Hence I hedge with PM accordingly.

Fri, 04/05/2013 - 01:07 | Link to Comment q99x2
q99x2's picture

Nikkei Erupts and This Time It May Be Different

sarc> or whatever. That is from CNBC. How come they can write such crap and I get down arrows?

Fri, 04/05/2013 - 01:04 | Link to Comment williambanzai7
williambanzai7's picture

BTFB?: Buy The Fucking Bit

Fri, 04/05/2013 - 02:12 | Link to Comment THX 1178
THX 1178's picture

Buy the Fucking Bullion

Then

Bury that fucking bullion

Then

Bake those fucking beans

Then

Blast those Farts Brotha

Fri, 04/05/2013 - 01:08 | Link to Comment ebworthen
ebworthen's picture

"Triggered circuit breakers..."

Can you say "point of diminishing returns"?

Can you say "You say you went fishing but you smell like pussy and there is red lipstick on your neck".

Fri, 04/05/2013 - 01:12 | Link to Comment Hangfire
Hangfire's picture

The real circuit breaker trigger!

http://www.youtube.com/watch?v=8trsDPpAI5E

Fri, 04/05/2013 - 02:07 | Link to Comment ebworthen
ebworthen's picture

Godzilla is coming, the BOJ just doesn't realize it.

Oh sure, 7 Trillion Yen of tanks and missles is going to stop the prehistoric force, sure.

Fri, 04/05/2013 - 01:08 | Link to Comment HD
HD's picture

I'm hopefully pessimistic. Go black swans!

Fri, 04/05/2013 - 01:18 | Link to Comment Number 156
Number 156's picture

"I'm hopefully pessimistic. Go black swans!"

I'm only hoping we start going down now, because every day I see the markets go higher, my fear is increased by same amount. Because in the end, Government officials will have exempted themselves from all after effects of an economic collapse.

I'm not a government official.

Fri, 04/05/2013 - 01:35 | Link to Comment HD
HD's picture

"Government officials will have exempted themselves from all after effects of an economic collapse."

Worse than that - they have and will continue to benefit from it.

BTW your green arrows are not working but +1

 

Fri, 04/05/2013 - 01:08 | Link to Comment Number 156
Number 156's picture

Yeah Alex, I'll take "Combustibles" for $500.00.

DAILY DOUBLE!!

Fri, 04/05/2013 - 01:15 | Link to Comment chump666
chump666's picture

hahahahahah

China dump

Fri, 04/05/2013 - 11:07 | Link to Comment earnyermoney
earnyermoney's picture

I think the Japanese are the proxy army of the US FED in it's war with China.

Fri, 04/05/2013 - 01:11 | Link to Comment hooligan2009
hooligan2009's picture

simply selling 10s for 30s..yield fall there..price action when the BoJ buys the long end

Fri, 04/05/2013 - 01:19 | Link to Comment chump666
chump666's picture

No, Google China buys short end debt (Japan).  It is beautiful Art of War right there.  China is going to punish Japan.  Sorry no love for China at all, but Japan had it coming.

Fri, 04/05/2013 - 01:22 | Link to Comment williambanzai7
williambanzai7's picture

Wouldn't you love to play poker with Kuroda?

Fri, 04/05/2013 - 01:47 | Link to Comment chump666
chump666's picture

He just got played. 

And I know you are going to have fun with this, look forward to the next post.

Fri, 04/05/2013 - 01:53 | Link to Comment hooligan2009
hooligan2009's picture

the rape of tokyo?

Fri, 04/05/2013 - 01:12 | Link to Comment One of We
One of We's picture

When you debase your currency aren't you supposed to at least pretend you give two shits about its integrity? Seems Shinzo just jumped up the table and said "if it's gonna be that kind of party I'm gonna stick my dick in the mashed potatoes!"

Fri, 04/05/2013 - 01:25 | Link to Comment Cookie
Cookie's picture

aaarghh...toasted cheese and ham all over my laptop!

Fri, 04/05/2013 - 01:56 | Link to Comment thecoloredsky
thecoloredsky's picture

comment of the day!

Fri, 04/05/2013 - 02:50 | Link to Comment Pareto
Pareto's picture

Of the month!

Fri, 04/05/2013 - 01:13 | Link to Comment Crawdaddy
Crawdaddy's picture

I looked at the trap Ray.

Fri, 04/05/2013 - 01:21 | Link to Comment williambanzai7
williambanzai7's picture

" Bank of Japan Governor Haruhiko Kuroda played down concerns his unprecedented burst of monetary stimulus would create asset-price bubbles"

A yup yup yup, a yup yup yup...

Fri, 04/05/2013 - 01:24 | Link to Comment Ineverslice
Ineverslice's picture

 

They have switched off the safeties on tubes 1-4.....

Battlestations!

.353   to .607   ...ouch

Fri, 04/05/2013 - 01:21 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

I cant even begin to understand these charts, the lingo, or how to profit from this info.
More power to those that do.
I'll be over here with my AU, AG, and BTC when you want to play again Tyler.

Fri, 04/05/2013 - 01:32 | Link to Comment Zgangsta
Zgangsta's picture

Does it matter what the bond price is?  It's only being bought with the money that BOJ is conjuring up anyway.

Fri, 04/05/2013 - 01:33 | Link to Comment chump666
chump666's picture

Be careful Bass on your Yen short:

* Korea news - South willing to pull workers out of Kaesong industrial zone if  worker's safety endangered, report Japan considers shooting down North Korea missile, North Korea still targeting US mainland.

Fri, 04/05/2013 - 01:38 | Link to Comment Mr. Saxby
Mr. Saxby's picture

Oddly enough, I expect that any potential North Korean nuke strikes will be "coincidentally" in the Fukushima-Daichi area.

Fri, 04/05/2013 - 06:27 | Link to Comment BigInJapan
BigInJapan's picture

And if so, I say we lay waste to those brownteeth lollipops.

 

Fri, 04/05/2013 - 01:47 | Link to Comment Ineverslice
Ineverslice's picture

 

QE vs Entropy

Disordiliness will win.

Fri, 04/05/2013 - 02:22 | Link to Comment chump666
chump666's picture

Always.

Something us humans fail to grasp within our fallacy of control.

 

Fri, 04/05/2013 - 01:38 | Link to Comment AndrewJackson
AndrewJackson's picture

Anyone else surprised by the lack of zerohedge comments on the news from japan over the past day? This is the equivalent of a 200 billion fed purchase per month and no one seems to care? It is just really odd given that Japan is the base case for the US future. 

Fri, 04/05/2013 - 01:43 | Link to Comment Spitzer
Spitzer's picture

Because we are numb to the bullshit.

I was watching the hockey game.

Fri, 04/05/2013 - 02:00 | Link to Comment robertocarlos
robertocarlos's picture

They really are getting desperate. Makes for some great games.

Fri, 04/05/2013 - 01:48 | Link to Comment akak
akak's picture

After the 50th jumping of the shark by world central banks, one begins to become a bit jaded to the whole sordid spectacle.

Fri, 04/05/2013 - 06:52 | Link to Comment Ljoot
Ljoot's picture

But the distractions are numerous. Bayou Corne, Arkansas pipeline burst, Ga. Power power plant explosion, fukushima...

BTW, latest flyover of the LA sinkhole on 4/4.

http://youtu.be/UOu7in9TKdg

 

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