Draghi QE "Reflection" Drops Euro, Pops Bonds/Stocks

Tyler Durden's picture

Despite Draghi's explanation that a QE program in Europe (due to the greater extent of bank lending vs capital market financing) would not be "as efficient" as the Fed's program, his comment that:


Has provided just enough "hope" juice to drive the EUR lower and ramp bond and stock prices across Europe (for now). We will have to see what the half-life of this jawboning is. Of course, the EUR selling is USD buying and that is pumping USDJPY higher - and therefore a pre-open pump in US equities.

EUR slides...


Bonds rip tighter in spreads...


and Stocks pop...


Amazing... just so much "faith" that they know what they are doing...

of course, what matters to US equity markets is USDJPY and that's ripping (as EURJPY is unwound)...

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NotApplicable's picture

So... Draghi's gotta hard-on for QE?

medium giraffe's picture

Now that he's mentioned QE, will we see the EUR getting driven up to force his hand?  USD is weak enough to make it easy.

Haus-Targaryen's picture

Draghi will drop interest rates before he executes QE. 

It still baffles me beyond reason how in Gods name how Southern European politicians can explain to their populations why they have to stay in the Euro. 

Ghordius's picture

perhaps you don't understand Southern Europeans? their old... skepsis towards their own politicians? or their habits of saving? in cold, hard cash? just look how many €500 notes are in circulation

of course you can quote Dr. Krugman and say that they should devalue, devalue, devalue. yet they would usually answer: "seen that, done that. does not solve problems"

you know for example what every well-to-do Turkish family has, somewhere well out of sight? a stash of gold and a stash of EUR

it baffles me how many ZH commentators argue that the ECB should QE at all. well, to each his hobby horses

Spitzer's picture

Funny how most idiots don't realize that the currency does not have to devalue to get the desired undercutting effects. Wages in the south have fallen nominally to get that effect while keeping the currency itself (Euro)strong.

Keynesians, fucking idiots

Euro bears, clueless

Ghordius's picture

well, to be fair it's harder, politically, to have wages drop. yet that's the point: Southerners have seen the elephant. they know that devaluation is just the same as wages cuts. they know that getting back to a national Drachma, Lira, Peseta, etc. is like signing a blank check to their pols

at the end, it's all about populations that like to save and populations that like to spend

remember how nearly nobody here understood Draghi's comment about the political capital invested in the EUR?

Spitzer's picture

Funny how most idiots don't realize that the currency does not have to devalue to get the desired undercutting effects. Wages in the south have fallen nominally to get that effect while keeping the currency itself (Euro)strong.

Keynesians, fucking idiots

Euro bears, clueless

Mister Ponzi's picture

Less efficient than in the US? Good god... Time to buy more gold.

Looney's picture



Smegley Wanxalot's picture

WTF is "efficient" about the fed's program?

Sudden Debt's picture

You try to kick 360 million people a thousand times over in the nuts and get away with it.

They're good. Plain and simple.

Looney's picture

They EFFICIENTLY extract what's left of the working stiff's money?  ;-)


disabledvet's picture

"Keep your gold buried and your cash in the wall.

emsolý's picture

"Reflection" is never and nowhere a monetary phenomenon.  Come on Mario, you can do better to destroy the Euro!

thismarketisrigged's picture

of course, this douchebag all he does is talk to pump stocks up, just like our federal reserve.


when the fuck is this going to end, i hate these bastards with such a passion


enough is e fucking nough, end this shit already.


i honestly cant remember last time futures were red in morning.

Spitzer's picture

King Euro

Remember all the parody calls ?

Europe is stupid but not stupid enough for open ended , non sterilized money printing.

NoDebt's picture

You give them a lot of credit.  Nobody thought Elliott Spitzer was stupid enough to get caught with some $10K/night hooker.... but he was.

buzzsaw99's picture

obviously not enough of the qe money is going into banker bonuses. time for a revamp.

Bankstein Swissgoldberg's picture

i really have no sympathy for that kind of guy - draghi - but i admire his ability to get something out of nothing. How is it that he keeps serving the same lie over and over and it still works? Magic?

Ghordius's picture

no, it's the magic of projection. the FED is... X therefore the ECB is the same. the US is... X therefore the EU is the same

most important megabankers, even at Deutsche Bank and other theoretically european megabanks, are... Americans. and those based here are based in London, which is not only the most important hub of EUR trading, it's also where everybody and his grandmother are betting since years on the demise of the EUR

the magic is not Draghi's. it's who listens and believes that "the E-stuff is the same as the US-stuff" (ZH is a valid example for this)

sorry, I've met a few of them. they carry their ignorance of all things european like a badge of honour. it's not important. Fuck it. etc.

LawsofPhysics's picture

Expected jawboning..

bazookas, QEs, LTROs, etc...

Show me the real collateral motherfucker.

Glad I have been buying/holding some rubles...

Arrogant fucks...

Stoploss's picture

Nobody gives a shit anymore.

Just waiting for reality to catch up, and catch up it will.

LawsofPhysics's picture

sure, all debt has only one of two outcomes...


khakuda's picture

6 years in watching each member of the developed markets take turns debasing the currency, it is beyond a joke at this point.

One day a straw will break the camel's back and they will all stand around with dumb looks on their faces.  "Nobody knew!"

MFLTucson's picture

The corruption is so deep its hard to follow but, each and everyday this garbage copntuies to elevate stocks into areas that should never be!

LawsofPhysics's picture

Indeed, "mark to fantasy" forever!

Yen Cross's picture

  A shitty non manufacturing ISM print should be enough to pump ES to 1900...

SheepDog-One's picture

A little vague jawboning about QE hints is all it takes to drive new all-time highs.....just vomitous.

elwind45's picture


adonisdemilo's picture

If Draghi thinks the US QE was/is "efficient" he might be able to get a job flipping burgers which would probably more in keeping with his abilities.