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Europe In One Chart

Tyler Durden's picture


How much is the 'promise' of a European Central Banker worth? As European macro data in the last month has plunged at its fastest rate in 6 years, equity markets have, of course soared back to near multi-year highs (EuroStoxx 600 up 5% in the last week alone). We only hope that the equity markets really do know something different this time - as opposed to the last two times we saw this kind of disconnect. The answer - Draghi's 'whatever it takes' promise is maintaining a 30% illusion of wealth in European equities over their macro reality.

It's different this time - the disconnect that we have seen twice before in the last 5 years is 'transitory'


as the last 25 days have seen the biggest plunge in macro reality in almost six years...



Charts: Bloomberg

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Fri, 04/26/2013 - 19:21 | 3504256 HD
HD's picture

Think of a wonderful thought - any happy little thought....

...You can fly, you can fly...

Fri, 04/26/2013 - 19:27 | 3504265 markmotive
markmotive's picture

How much is the 'promise' of any economist worth for that matter?

With Rogoff and Reinhart discredited by a graduate student, who are we supposed to believe?



Fri, 04/26/2013 - 19:31 | 3504278 HD
HD's picture

Economists are worthless because they will not think outside the box. The adhere to their models and ignore any information that does not "fit" as irrelevant.

Fri, 04/26/2013 - 22:16 | 3504761 dunce
dunce's picture

I recently ran across a definition of an economist as someone that sees a functioning economy and wonders how it would work in theory.

Sat, 04/27/2013 - 01:40 | 3505030 BadKiTTy
BadKiTTy's picture

"in theory there is no difference between theory and practice. In practice there is"


Sat, 04/27/2013 - 08:11 | 3505256 DavidC
DavidC's picture

Steve Keen is one economist I would always listen to and genuinely thinks outside the box.


Fri, 04/26/2013 - 20:05 | 3504384 Vuke
Vuke's picture

You should put absolute faith in your financial advisor and his/her economist.  And, be sure to pay your taxes and credit cards on time.

Fri, 04/26/2013 - 20:05 | 3504355 spine001
spine001's picture

in markets like in nature you must let natural forces take over and cleanse the populations. Forest fires play this role. The more you avoid them the more likely they become until they finally happen, get out of control and you get a major disaster. There we learned to start the burns ourselves in a controlled manner and to plan and rotate the burns. Economists should stop their megalomaniac drive to autodestruction and accept the hard leasons learned from nature, about natural equilibrium and evolution and do the same before it is too late and it self burns out of control. Sooner or later nature has proven that it will find the way no matter what we do to try to prempt it.

Until next time,


Fri, 04/26/2013 - 20:25 | 3504448 white_guy
white_guy's picture

great post.  An analogous way to point this out is through the principle of minimization of the Gibbs free energy of closed systems at equilibrium....which of course directly follows from the second law of thermodynamics.  The further we get away from equilibrium, the harder it is to maintain, and the harder the inevitable fall will be.  Even economic matters cannot escape the beautiful generality of the second law. 

Fri, 04/26/2013 - 20:47 | 3504512 Miss Expectations
Miss Expectations's picture

In my neck of the woods, the planned controlled burns get out of control at least half the time.  Even when it's windy, they just light the woods on fire anyway.

Sat, 04/27/2013 - 07:04 | 3505226 W T F II
W T F II's picture

Let the markets clear is NOT in the lexicon of this generation of central bankers. We will ALL regret their folly...

Fri, 04/26/2013 - 19:43 | 3504312 A Lunatic
A Lunatic's picture

These charts are looking more like sharts every time I see them........

Fri, 04/26/2013 - 20:41 | 3504490 1eyedman
1eyedman's picture

just a short, sharp, shart...

Fri, 04/26/2013 - 20:29 | 3504464 e.blair
e.blair's picture

What does that mean, "macro"?  What is the definition?


Sat, 04/27/2013 - 03:09 | 3505102 piliage
piliage's picture

To an economist, central banker, or trader? It means absolutely nothing.

Fri, 04/26/2013 - 20:34 | 3504475 q99x2
q99x2's picture

Italy is supposed to get a new president that is aligned with the Troika.

That should extend the pretend for a while.

Fri, 04/26/2013 - 20:40 | 3504485 1eyedman
1eyedman's picture

check out consumer metrics....near cliff dive of daily econ acitivity....they'll wish for a 2.5% gdp miss in about 60 days.  it does push out any kind of 'official'  recession for another 7 months.    "this is not the recession you're looking for...."

Fri, 04/26/2013 - 21:17 | 3504611 vote_libertaria...
vote_libertarian_party's picture

So....uhhh....it's like, bullish???

Fri, 04/26/2013 - 23:00 | 3504882 CURWAR2012
CURWAR2012's picture

uh, that's 2 charts.

Sat, 04/27/2013 - 10:12 | 3505352 PubliusTacitus
PubliusTacitus's picture

Draghi says uno.


Uno charta.


Is okay, see?

Sat, 04/27/2013 - 07:08 | 3505228 W T F II
W T F II's picture

Please call me when Draghi buys his first post-"anything it takes" OMT bond...I am going back to bed now...

Sat, 04/27/2013 - 10:11 | 3505350 PubliusTacitus
PubliusTacitus's picture



All your markets are belong to us nows

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