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Futures Tumble, Bunds Soar To Record, Gold Surges As Europe Is Broken Again; Espirito Santo Halted

Tyler Durden's picture


But... but... the VIX said everything is ok, and European rates were the lowest they have been in centuries... How can something possibly go wrong?

It just did.


The scandal which we first reported yesterday, after observing the record collapse in the bonds of troubled Portuguese lender Espirito Santo International following the failure to make a bond payment, has quickly escalated and overnight went nuclear.


It seems someone is intervening in Portuguese bonds...


Early on in the European trading session, following a report in Diario that E.S. International is considering an insolvency request, Espirito Santo Financial Group, which holds 25% of Banco Espirito Santo, fell as much as 16.15% to EU1.09 and traded over 15% lower at EU1.10, at the same time as Banco Espirito Santo fell as much as 7.15% to EU0.571.This was aggravated by creditors concerns that anything was contained after yesterday's failed damage control attempt by the parent.

Then things went from bad to worse after Espirito Santo Financial announced it has suspended trading in its shares and bonds due to its exposure to ESI, adding the decision was taken due to “ongoing material difficulties” at its largest shareholder Espirito Santo International, according to regulatory filing.  ESFG says it “is currently assessing the financial impact of its exposure to ESI”. ESFG also suspends bond issued by fully owned subsidiary Espirito Santo Financiere. We will have the full, convoluted, org chart of Espirito Santo shortly.

At that point the genie was out of the bottle and thanks to Europe's still completely insolvent banking system, linked intimately to the sovereign as the ECB has done absolutely nothing to break the bank-sovereign link, promptly hit the sovereign sector, leading to a blow out in the Portuguese 5Y yield +16bps to 2.616%, sending the 10Y yield pushing wider +12bps to 3.896%, and the 10Y spread vs bunds +15bps to 270bps, highest since May 21. And not only in Portugal but other peripheral spreads widened also, with Greece (which is supposed to sell 3Y bonds today - good luck) and Ireland expanding most in 10Y.

Then the safe haven trade came back with a vengeance and the September German Bund future rose as much as 46 ticks to a contract high 147.79, and sending 10 Year yields to all-time lows of 1.17%.

Then, the contagion spread to stocks as first European shares tumbled, with the banks and travel & leisure sectors underperforming and personal & household, telco outperforming. The Italian and Spanish markets are the worst-performing larger bourses, the U.K. the best. Then, it moved across the atlantic as S&P futures have tumbled the most in months in the premarket.

Adding insult to Portuguese bank injury, was very disappointing French (-1.7%, Exp. 0.2%, Last 0.3%), Italian (-1.2%, Exp. 0.2%, Last 0.5%) and Dutch (-1.9%, Exp. 0.3%, Last 2.3%) industrial Production data, confirming any illusions about a European recovery absent a fix of the broken credit channel are utterly ridiculous, and that the ECB was once again wrong focusing on boosting the carry trade - the very same reason why Portugal is today picking up the pieces as Draghi forced traders in the very same trades which today are halted in Portugal!

In other news commodities decline, with nickel, WTI crude underperforming and silver outperforming. But not gold and silver: the precious metals have exploded this morning, with gold trading north of $1340 (but... but... Morgan Stanley said...) and silver at $21.50.

Finally, US equity futures are tumbling. This may be the day contagion and volatility finally comes back with a vengeance, which is great news for all those who plodded through months of centrally-planned boredom and artificial stability. Let the games finally begin.

Market Wrap

  • S&P 500 futures down 0.5% to 1958.2
  • Stoxx 600 down 0.8% to 337.4
  • US 10Yr yield down 2bps to 2.53%
  • German 10Yr yield down 3bps to 1.2%
  • MSCI Asia Pacific down 0.1% to 146.5
  • Gold spot up 0.1% to $1329.8/oz


  • All 19 Stoxx 600 sectors fall; personal & household, telco outperform, banks, travel & leisure underperform
  • 13.5% of Stoxx 600 members gain, 84.8% decline
  • Eurostoxx 50 -0.7%, FTSE 100 -0.4%, CAC 40 -0.9%, DAX -0.8%, IBEX -1.6%, FTSEMIB -1.7%, SMI -0.4%


  • Asian stocks little changed  with the Sensex outperforming and the Nikkei underperforming.
  • MSCI Asia Pacific down 0.1% to 146.5
  • Nikkei 225 down 0.6%, Hang Seng up 0.3%, Kospi up 0.1%, Shanghai Composite down 0%, ASX up 0.2%, Sensex up 1.5%
  • 5 out of 10 sectors rise with energy, utilities outperforming and telcos, health care underperforming

Bulletin headline summary from RanSquawk and Bloomberg

  • Treasuries gain as bank stocks lead European equities lower, peripheral sovereign yields surge, with Portugal’s 10Y yield +22bps amid concern over problems at the nation’s second largest bank.
  • Shares of Banco Espirito Santo SA tumbled more than 14%, bonds to record lows; central bank assurances that it is protected after parent company missed debt payments are failing to ease creditor concern they may also suffer losses
  • Spain’s Banco Popular postponed a planned euro benchmark offering of PNC5 AT1 notes, citing heightened volatility in secondary markets; IPT had been 7%/7.25%
  • China’s exports trailed estimates in June, suggesting support for growth from global demand will be limited as leaders try to defend their economic-expansion goal of about 7.5% this year
  • Japan’s machinery orders fell the most on record in May, suggesting that companies remain cautious about deploying record cash reserves into investment
  • Israel has mobilized 20,000 soldiers for a possible ground invasion of the Gaza Strip, as militants there extended their rocket barrage and the Palestinian death toll climbed to at least 75
  • Donetsk is steeling itself for a siege as troops encircle separatists who’ve pulled back to the biggest city in Ukraine’s conflict zone after months of bloody unrest
  • Four months after Vladimir Putin’s government annexed Crimea, the U.S. and EU have failed to deliver on threats to cripple Russia’s economy, penalizing fewer than 100 people and companies
  • Sovereign yields lower with the exception of peripheral Europe; Greek, Spanish and Italian 10Y spreads to Germany all above 100-DMAs. Euro Stoxx Banks index slides 3.2%, at lowest since January. Asian stocks mixed; Japan and China fall.  European equities, U.S. stock futures decline. WTI crude and copper lower; gold surges 1.2%

US Event Calendar

  • 8:30am: Initial Jobless Claims, July 5 est. 315k (prior 315k); Continuing Claims, June 28 est. 2.565m (prior 2.579m)
  • 8:45am: Bloomberg July U.S. Economic Survey
  • 9:45am: Bloomberg Consumer Comfort, July 6 (prior 36.4)
  • 10:00am: Wholesale Inventories m/m, May, est. 0.6% (prior 1.1%); Wholesale Trade Sales m/m, May (prior 1.3%) Central Banks
  • 11:00am: Fed to purchases $450m-$600m TIPS in 2018-2044 sector
  • 1:00pm: U.S. to sell $13b 30Y bonds in reopening


Mixed performance overnight with the Nikkei 225 finishing the session down 0.56% weighed upon by a stronger JPY and a record decline in Japanese machine tool orders (M/M -19.5% vs Exp. +0.7%), whereas the Chinese equity market finished with marginal gains despite Chinese Trade Balance missing expectations (USD 31.56bln vs Exp. USD 36.95bln) as exports saw a third consecutive month of growth.


German bund yields have printed fresh all-time lows this morning below 1.2%, weighed on by very disappointing French, Italian and Dutch industrial Production data, as Bund futures hit fresh contract highs. Notably the GR/GE 10y spread is wider by 14bps, with reports that the Greek PDMA is to price 3y bond at 3.5% yield and not below 3% that was expected. This coupled with the Portuguese bank debt worries lead the Portuguese/German 10y spread to widen 16.3bps to a session high of 268bps, the widest since late March 2014. Note that today’s moves may well be also exacerbated by the thin summer volumes with the bund future only trading 200k contracts at the time of writing.


DAX futures have printed multi-month lows and are approaching the 100DMA, with the PSI 20 in Portugal down once again weighed by lingering concerns over the health of Espirito Santo Financial (ESF PL) after the Co. missed a short-term debt payment earlier in the week prompting weakness across European financials.


In the forex market the USD has recouped some of its lost ground that was seen post the FOMC minutes allied to the general risk off sentiment. This move has consequently weighed on both the EUR and GBP currencies with EUR/USD trading just around the 1.3600 level where there is a cluster of option expiries due for today’s NY cut.


A combination of risk averse sentiment and failure by the India government to alter gold import duty, continue to prove supportive for gold and silver prices, both trading at its highest levels since March. Earlier this morning, Indian jewellery industry said that expected tax on gold imports to be cut and that Indian gold prices, premiums may rise as import curbs retained. Jewellers in Mumbai were quoted as saying that people had held back on purchases expecting a duty cut and may well now come back to the market. Elsewhere, COMEX copper is under pressure following somewhat less than impressive Chinese trade balance data overnight.

* * *

DB's Jim Reid concludes the overnight news roundup

There are armies of strategists paid to mull over the FOMC minutes last night but however deep people try to decipher them the reality is that there was little new news outside of a few clarifications - the most important of which was the news that they aim to finish QE with a $15bn taper in October rather than leave $5bn hanging over until December. A personal view is that QE could easily come back in the next recession as the terminal funds rate may end up being pretty low this cycle thus leaving us pretty close to the zero bound when the Fed need to start easing again. Added to this is the fact that both the BoJ and the ECB could be in full flung QE mode by then, adding to the pressure to keep up and ensure the Dollar isn't prohibitively strong. Anyway this is probably a discussion for another day.

The other highlight of the minutes was the discussion around the Fed’s potential rate normalisation path. On this topic, most participants agreed that adjustments in IOER should play a central role during the normalization process and many participants agreed that ending reinvestments at or after the time of (rates) liftoff would be best. This is consistent with the recent comments of the NY Fed President Dudley. The other sections of the minutes were not particularly groundbreaking with nothing particularly hawkish to highlight and it was clear that policy remains data-dependent. In terms of the outlook for inflation, the discussion amongst Committee members was very benign. The FOMC acknowledged the recent move upwards in the PCE price index and CPI but “reports from business contacts were mixed, spanning an absence of price pressures in some Districts and rising input costs in others”. Indeed “some participants expressed concern about the persistence of below-trend inflation, and a couple of them suggested that the Committee may need to allow the unemployment rate to move below its longer-run normal level for a time in order keep inflation expectations anchored and return inflation to its 2% target”. But this was offset by others who “expected a faster pickup in inflation or saw upside risks to inflation and inflation expectations because they anticipated a more rapid decline in economic slack”.

Contrary to some expectations, there wasn’t much substantive FOMC discussion on financial stability but the Committee thought “market participants were not factoring in sufficient uncertainty about the path of the economy and monetary policy”. This is an interesting point, and the WSJ highlights that it’s actually the Fed officials themselves who are factoring in a relatively low amount of uncertainty with respect to economic outcomes. Based on the self-assessment of uncertainty (included in yesterday’s minutes), the number of Fed officials saying that uncertainty in GDP, unemployment and inflation forecasts is “higher” than usual was 3 or less for each economic measure. This is around half the number who felt the same in the June 2013 FOMC, and significantly less than June 2012 when at least 10 officials thought that uncertainty was “higher” than usual in regards to each of their forecasts for growth, unemployment and inflation.

Overall markets responded reasonably positively to the minutes as perhaps the fear was that the minutes would show that the committee wasn't quite as dovish as Yellen has been of late. However this wasn't the main takeaway and the S&P 500 (+0.46%) edged higher after the release and ended up snapping a two day losing streak. Bonds were pretty flat which bucks the trend of the last 10 FOMC minutes where 10yr yields have traded higher. The minutes were released towards the end of the US session giving EM little chance to react. However there was a decent tone to LATAM bond and sovereign credit markets following the FOMC minutes. Gold closed near the highs of +0.65% and the US dollar index dropped 0.23%.

In Europe, the ongoing concerns surrounding delays in payments of short-term debt securities by Espirito Santo International continued to trouble markets in the European session yesterday as Espirito Santo Financial Group’s equity fell a further 12% yesterday and its senior and LT2 bond’s lost over 20 points and 12 points respectively (with the latter’s closing bid in the high teens). Its partially owned subsidiary Banco Espirito Santo’s equity was down almost 5% and its CDS was 80 bps wider whilst its senior and LT2 bonds were off 1 and 4 points respectively. Espirito’s stresses have brought questions over the underlying health of Peripheral banks and the still evolving mechanisms for dealing with struggling institutions back into the spot-light and yesterday concerns spilled over into the government bond market as Portugal’s 10Y yield widened by 12bps. The current perception is that this is an isolated incident but its caused some nervousness in the credit world with iTraxx Financial Senior vs Main widening 1.25bps to the widest differential in 5 weeks.

It’s been an interesting Asian session this morning with weaker than expected economic data in China, Japan and Australia shrugged off by most asset classes which have been buoyed by yesterday’s benign FOMC minutes. The Chinese trade numbers for June disappointed on both exports (+7.2% YoY vs +10.4% expected) and imports (+5.5% YoY vs +6.0% expected). This has corroborated with weaker than expected June export numbers from a number of neighbouring Asian export powerhouses including South Korea and Taiwan and places a question mark or two over the state of global demand. China’s customs bureau played down the June numbers somewhat, saying that exports will accelerate in Q3. The Hang Seng index (+0.33% on the day) fell 0.3% following the data release but bounced back shortly afterwards. The Australian dollar is down 0.2% today following weaker than expected employment numbers (unemployment 6.0% vs 5.8% previous, 5.9% expected). USDJPY is also a touch lower today, and is being weighed by a 19.5% MoM drop in May machine orders (+0.7% expected). The fall is the largest since at least 1987 and being taken as a sign of continuing caution in terms of Japanese corporate investment. So some worrying data points in Asia.

The focus in EM Asia remains on political developments. In Indonesia, though the polls are predominantly indicating a win by Jokowi, his presidential rival Prabowo has also claimed victory which sets up a potential constitutional contest. Despite this, the Rupiah has reopened this morning up 0.6% against the USD and local stocks are up 2.2%. DB’s Asia FX strategists warn that beyond the post-election rally, the fragmented legislature, continued fuel subsidies and structural issues remain concerning headwinds. In India, a big day today for the new Modi government with the government budget due to announced soon. DB’s India economist notes that given the paucity of time since their election, it would be unreasonable to expect the budget to be a game-changer in terms of policy announcements, but the market will be looking for signals underscoring fiscal responsibility. As long as the right signals and intent are in place, our economists think the government should get the benefit of doubt, especially considering that fiscal consolidation takes time and cannot be achieved overnight. Ahead of the announcement, the INR is trading 0.3% better against the USD today, poised for its third gain in a row.

Turning to the day ahead, on the central bank side the ECB publishes its monthly report and the BoE announces its latest policy decision. No change from the BoE is expected today. The highlights on the data docket include industrial production in France and Italy, UK trade, US wholesale inventories and weekly jobless claims. The Kansas City Fed’s George will be speaking on the US economy and Vice Chair Stanley Fischer speaks on financial sector reform at the National Bureau of Economic Research. Fischer will be taking questions from the audience. This is the first major speech from Fischer as Vice Chair of the Fed so we could gain some fresh insights into his policy thinking


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Thu, 07/10/2014 - 07:08 | 4942548 GetZeeGold
GetZeeGold's picture



The Huns are at the gate!


Little help?

Thu, 07/10/2014 - 07:13 | 4942556 ilion
ilion's picture

Well, gold seems to be bought: chart

Thu, 07/10/2014 - 07:28 | 4942570 Headbanger
Headbanger's picture

USDJPY getting slammed as well:

But the most retarded thing of all this morning is CNBC saying volitility is up because of GROWTH concerns!!


Thu, 07/10/2014 - 07:29 | 4942593 nuclearsquid
nuclearsquid's picture

Now futures are tumbling UP 50 bps.

Thu, 07/10/2014 - 07:32 | 4942600 Headbanger
Headbanger's picture

I think your brain is tumbling in your head.

Thu, 07/10/2014 - 07:51 | 4942655 nuclearsquid
nuclearsquid's picture

Sorry. cNBC app gave me stale marks.  It must not be used to red.

Thu, 07/10/2014 - 07:56 | 4942664 cifo
cifo's picture

Not so fast.

Everything will be fine by Monday :)

Thu, 07/10/2014 - 08:30 | 4942734 101 years and c...
101 years and counting's picture

correction: everything will be fine once 8:30 am comes and then doubly fine at 3:30 pm when "someone" slams vix and yen.

Thu, 07/10/2014 - 08:44 | 4942737 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

Well... i am going back to bed

Thu, 07/10/2014 - 09:00 | 4942794 wallstreetapost...
wallstreetaposteriori's picture

As much as I want this to be the "big" correction, I know these a$$holes are going to come in and BTFD..  the correction is over.... all is well.... Cramer says buy buy buy.... jump sheep... I said JUMP!

Thu, 07/10/2014 - 10:19 | 4943114 dontgoforit
dontgoforit's picture

Huns, mongols, hugenots and carpathians are thru the gate.

Thu, 07/10/2014 - 12:20 | 4943681 pickupthatcan
pickupthatcan's picture

Don't leave out the Moops.

Thu, 07/10/2014 - 08:22 | 4942707 AccreditedEYE
AccreditedEYE's picture

Agree on CNBS = Retards. However, before we go getting too excited, let's remember that S&P500 is up in the neighborhood of 7% YTD... looong way to go to make that even flat on the year. I'll also add that this morning is painting the tape with a massive gap that will eventually need to be filled with market moving higher. IMHO, never, ever, ever give this market credit for reflecting reality. If it goes down, they are planning a much higher move.

Thu, 07/10/2014 - 09:17 | 4942855 SMG
SMG's picture

When all this is over I wouldn't be surprised to see Dow 100,000 or higher.  Of course then you're talking $100 loaves of bread, but hey it's all good right?  The market's up.

Thu, 07/10/2014 - 09:12 | 4942829 SofaPapa
SofaPapa's picture

"But the most retarded thing of all this morning is CNBC saying volitility is up because of GROWTH concerns!!"

Thanks for that one!  That's the best laugh I've had in a long time.  These guys really are too much!  If more people knew what the hell these morons were actually saying, comedians would be forced out of work.  Who needs comedy when you've got these schmucks giving it away for free!

Thu, 07/10/2014 - 07:22 | 4942571 COSMOS
COSMOS's picture

Worse than the Huns, its Mongols at the gate.

Thu, 07/10/2014 - 08:03 | 4942678 The Shootist
The Shootist's picture

The mongoloids.

Thu, 07/10/2014 - 10:07 | 4943060 Oh regional Indian
Oh regional Indian's picture

And he bent over his work,


So that no one knew,

He was a hunchback....

Thu, 07/10/2014 - 10:00 | 4943033 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

Try to make a post sometime that does not have implicit or explicit racist connotations to it.

Thu, 07/10/2014 - 10:46 | 4943209 Meat Hammer
Meat Hammer's picture

Oh, take out your manpon!

Thu, 07/10/2014 - 07:25 | 4942584 USisCorrupt
USisCorrupt's picture

Nothing to see here, move on.

Thu, 07/10/2014 - 07:35 | 4942608 NoDebt
NoDebt's picture

Jim Reid says it's an isolated incident so I'm going with that.

Thu, 07/10/2014 - 07:39 | 4942623 fonzannoon
fonzannoon's picture

Is he back from bicycling?

Thu, 07/10/2014 - 07:46 | 4942641 Urban Redneck
Urban Redneck's picture

A guy dies of hemorrhagic fever after wandering through the middle of an Ebola outbreak, and the US government welcomes the corpse back with open arms, without cremating it first and after only a single lab test from a 3rd world medical lab with no Ebola expertise comes back with a negative result...

Either Secretary Kohn is the most incompetent horse's ass in the long line of asses who have been responsible US foreign relations, or someone in the leviathan wants to get their hands on something they really have no legitimate business having at their disposal. Either way, Americans should be very, very afraid...

But you're right - nothing to see here, move on.

Thu, 07/10/2014 - 07:53 | 4942657 Seize Mars
Seize Mars's picture

Yeah, they are working overtime on this shit.

The standard script should be that the war (or ebola outbreak, or whatever) starts first, then the financial collapse follows.

Bring it.

Thu, 07/10/2014 - 08:22 | 4942719 yogibear
yogibear's picture

Ebola is one way the Obama-Bill Gates clan has of eliminating millions of the population.

If that doesn't eliminate enough there is always global war.

Just keep watching Amrica's got talent.

Thu, 07/10/2014 - 08:37 | 4942751 flapdoodle
flapdoodle's picture

Up arrow for calling attention to the psychopath Bill Gates - I am astonished how evil this guy is... and it looks like Zuckerberg is just as evil. I guess you don't get into the 1% club unless you are...

Thu, 07/10/2014 - 08:58 | 4942791 knukles
knukles's picture

What was it Zuckerberg said about killing and or cleaning alive little rabbits in his own kitchen for fresh food or something that was really twisted?
Fuck, I don't remember other than it was something a self centered narcissistic little rich kid would say, which made me think it wasn't him.   Somebody suggested an arranged marriage between him and Miley Cyrus. 

Thu, 07/10/2014 - 14:29 | 4944336 barre-de-rire
barre-de-rire's picture





***                                                                                              ***

***                                                                                              ***               

***             ebola virus is mutating, they call it now OBAMA virus.         ***

***                                                                                              ***

***     315 millions americans down already.                                     ***

***                                                                                              ***






Thu, 07/10/2014 - 08:28 | 4942730 post turtle saver
post turtle saver's picture

they'd have to weaponize it to a) make it airborn, and b) keep the host alive longer to maximize transmission... since the CDC already has all the Ebola samples they need and then some to do this, the article is barking up the wrong tree...

you want to really put the smackdown on a large population? weaponize influenza... nasty, nasty stuff

Thu, 07/10/2014 - 08:44 | 4942767 Urban Redneck
Urban Redneck's picture

Uncorking a 2000 or 1995 vintage destroys plausible deniability.

The other critical factor is they have a convenient border crisis right now (granted it isn't likely to end anytime soon) but they can't guarantee a "natural" flu epidemic before the current window of "opportunity" closes.

To quote a certain neocon- "you go to war with the army you have, not the army you might want or wish to have at a later time."

Thu, 07/10/2014 - 08:44 | 4942765 LawsofPhysics
LawsofPhysics's picture

You don't think that the U.S. government already has numerous samples of this virus as well as numerous other nasty ones.  Shit, the EPA has some too, I know a person working in an EPA lab.  They have been doing contract work with the CDC for about 30+ years.  You are an idiot.

Thu, 07/10/2014 - 09:02 | 4942797 codecode
codecode's picture

I don't neccessarily disagree with your analysis... but the top local news story on your blog reference is "Castro Is Alive, Needless Crying Could Prevent Him From Coming Back To Earth - Marine Agent"... (i.e. "Castro" the "Hiplife Musician")

Thu, 07/10/2014 - 09:42 | 4942919 Urban Redneck
Urban Redneck's picture

Welcome to Africa... where "3 signs your wife will cheat on you" share column inches with "Road Contractors Abandon Nationwide Projects Over Government’s GH¢184 Million Debt" I think Castro supposedly drowned while jet skiing with a member of their disgraced World Cup squad, hence the tabloid fetish for the subject, but I don't read past the headlines on those articles in my RSS feed.

Just to clarify- my actual analysis is not that Darth Cheney's minions or fellow travelers (Rahm "never let a good crisis go to waste" or his pro-eugenic kin Zeke) would want to wipe out 50-75% of the domestic USSA population with a nasty bug right now, but rather they would want to terrorize 100% of the domestic population into gladly surrendering even more of their civil liberties, conditioning the slaves to be thankful when men come in the night to remove their neighbors "because they're from the government and they're there to help" and lastly codifying these and other imperial necessary powers to commit such crimes into law, or at least have the option of doing so if they actually started to fear the serfs rising up.

Either that or John Kerry really is such an incompetent ass that a one-way trip to the glue factory would be a national service on his part. Hanlon's Razor and all...

Thu, 07/10/2014 - 07:46 | 4942644 seek
seek's picture

It's not a big enough move yet, but those rocket moves upwards in AU always seem to be accompanied by crap hitting the fan not long after.

My own metric for paying attention is around a 5% intraday move... so we'll see, the day is still young.

Thu, 07/10/2014 - 07:48 | 4942646 fonzannoon
fonzannoon's picture

remember when silver used to move $1.50 on a big day? seems like forever ago.

Thu, 07/10/2014 - 08:19 | 4942710 NoDebt
NoDebt's picture

We had a lot of ground to cover in a short time coming down out of the 40s.

Thu, 07/10/2014 - 08:00 | 4942672 r00t61
r00t61's picture

Would the PPT permit a 5% intraday move?

Wouldn't trading simply be suspended if the indices fell too far?  A simple "trading has been halted to correct a technical issue" PR blurb can be released to calm the masses.

Thu, 07/10/2014 - 08:22 | 4942715 Eyeroller
Eyeroller's picture

Yeah, they'll shut it down for -5%, but if it were +5% it would probably be "rally on".

Thu, 07/10/2014 - 08:29 | 4942735 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

Well... I'm giving my Portuguese banker a kick in the shorts ....

Thu, 07/10/2014 - 07:22 | 4942567 asking4it2k
asking4it2k's picture

No worries. Its all rigged by the FED

This selloff today is just the FED telling their "primary dealers" to sell in order for their plan for an indefinite bull market not look so obvious.

The FED wont let the bubble burst and hurt their "primary dealers" on Wall Street.

We will be back in the green tomorrow.

Thu, 07/10/2014 - 07:37 | 4942618 negative rates
negative rates's picture

Unless we arn't of course.

Thu, 07/10/2014 - 07:45 | 4942643 El Hosel
El Hosel's picture

Yeah, like the last six years .... Raise your hand if it is not obvious that "The Markets" have been taken over by a green machine.

Thu, 07/10/2014 - 09:31 | 4942933 pods
pods's picture

I loved The Green Machine.  Kicked a big wheel's ass.


Thu, 07/10/2014 - 08:39 | 4942697 SuperRay
SuperRay's picture

You give too much credit to those asshole morons. They're going to lose control. Just like 1929 & 1934. They lost control then, but took it back after ther collapse happened. We can't let them do that again this time.

Thu, 07/10/2014 - 07:11 | 4942550 conscious being
conscious being's picture

Hold on.  We can't have collapse til we get WWIII underway.  Otherwise, everyone will see who's swimming naked.

Thu, 07/10/2014 - 07:41 | 4942630 DaddyO
DaddyO's picture

Everyone is swimming naked!

It's a nudist colony of Central Bankers...


Thu, 07/10/2014 - 08:22 | 4942718 Eyeroller
Eyeroller's picture

You just ruined my breakfast...

Thu, 07/10/2014 - 08:24 | 4942723 e_goldstein
e_goldstein's picture


Thu, 07/10/2014 - 08:13 | 4942696 sidiji
sidiji's picture

Old story, and increasingly irrelevant. Lol we're almost 10 years on now from financial crisis, tell me something new Tyler.

Thu, 07/10/2014 - 09:42 | 4942982 Charles Nelson ...
Charles Nelson Reilly's picture

I guess you believe CNBS' math... 2008 + 10 years = 2014.  Thanks, can you tell me if you handle investments?

Thu, 07/10/2014 - 07:13 | 4942551 JustObserving
JustObserving's picture

Quick, can we not generate some fake economic data to show that everything is perfectly fine?  Goldman can raise Q2 GDP estimates from 3.3% to 4% or Yellen can say that inflation has fallen below 1% and interest rates will remain near zero in her lifetime.

Morgan Stanley: gold price won't see $1,300 again

Thu, 07/10/2014 - 08:20 | 4942712 Winston Churchill
Winston Churchill's picture

Some serious price reductions coming thru on my Zillow updates.

10-15% off,whereas last month it was $5-10k off.

RE is shitting the bed here in Fla.

Thu, 07/10/2014 - 08:38 | 4942752 greatbeard
greatbeard's picture

>> RE is shitting the bed here in Fla.

I pretty much stopped shopping but I still get email updatesa and I haven't seen that.  I'll have to look a bit closer.  But after reassessing I'm liking hanging on the hobby farm for another year or two no matter what the market does.

Thu, 07/10/2014 - 08:24 | 4942724 yogibear
yogibear's picture

CNBS is working on it.

Thu, 07/10/2014 - 09:13 | 4942838 Rinzler
Rinzler's picture

Up arrow for the MS kick in the crotch.

Thu, 07/10/2014 - 07:09 | 4942552 SoilMyselfRotten
SoilMyselfRotten's picture

Gonna be an interesting day

Thu, 07/10/2014 - 07:10 | 4942553 craus
craus's picture

All is well. Oliver get the 102 tractor running.

While I suck on the Yellen teet with the wool over my eyes.

Thu, 07/10/2014 - 07:11 | 4942554 max2205
max2205's picture

What year is it?

Thu, 07/10/2014 - 07:13 | 4942555 conscious being
conscious being's picture

What ever it is, it is late.  Overdue. 

Thu, 07/10/2014 - 07:17 | 4942562 GetZeeGold
GetZeeGold's picture



It's the year of total transformation silly. Be careful.....the paint still isn't dry yet.

Thu, 07/10/2014 - 07:42 | 4942634 DaddyO
DaddyO's picture

as he peers from the corner they have painted him into...


Thu, 07/10/2014 - 08:06 | 4942685 Dubious Intentions
Dubious Intentions's picture

The gold paint over tungsten bars? Yeah, good call. Wouldn't want finger prints.

Thu, 07/10/2014 - 07:14 | 4942557 Hindenburg...Oh Man
Hindenburg...Oh Man's picture


Thu, 07/10/2014 - 07:22 | 4942575 Headbanger
Headbanger's picture

Yeah do it you mook!

Thu, 07/10/2014 - 07:25 | 4942582 fonzannoon
fonzannoon's picture

He's the mook? Because btfd has been such an awful plan?

This is just a setup for Draghi to announce the next big fucking thing. of course you btfd.

Thu, 07/10/2014 - 07:34 | 4942595 Headbanger
Headbanger's picture

You do it too Mister "No Taper"


Then bend over!

And keep singing.. la la la la la la la....

There ya go.

Thu, 07/10/2014 - 07:37 | 4942611 fonzannoon
fonzannoon's picture

completely agree i said they would never taper and they are ending the fucker. i was totally wrong. thankfully i have not shorted the market every day. i'd rather be wrong and make money. you have predicted a crash and lost your ass for a long time now. Mook = you

Another thing btw. They are ending QE because there is insatiable demand for UST's. Get that through your hamster wheel while you keep proclaiming interest rates will explode higher.

Thu, 07/10/2014 - 07:38 | 4942622 Grande Tetons
Grande Tetons's picture

Mook is my middle name. 

Thu, 07/10/2014 - 07:39 | 4942625 fonzannoon
fonzannoon's picture

The only thing that keeps me from getting really mad at him is he chose mook, which is just a tremendous word.

Thu, 07/10/2014 - 07:49 | 4942648 Headbanger
Headbanger's picture

No go ahead and get really mad at me.

You'll feel a lot better.

Thu, 07/10/2014 - 07:51 | 4942656 fonzannoon
fonzannoon's picture

i could never stay mad at you

Thu, 07/10/2014 - 08:14 | 4942699 dontgoforit
dontgoforit's picture

They call me "Mr. Mookie."

Thu, 07/10/2014 - 09:03 | 4942803 ThirdWheel
ThirdWheel's picture

I named my Boston Terrier Mookie.
She wears it well.

Thu, 07/10/2014 - 07:50 | 4942649 GetZeeGold
GetZeeGold's picture



while you keep proclaiming interest rates will explode higher.


Anyone that wants that is getting placed on instant suicide watch.

Thu, 07/10/2014 - 08:58 | 4942790 Tall Tom
Tall Tom's picture

Suicide by Nail Gun I assume...

Thu, 07/10/2014 - 07:41 | 4942633 SoilMyselfRotten
SoilMyselfRotten's picture

Insatiable appetite = Belgium bearding?

Thu, 07/10/2014 - 07:43 | 4942636 fonzannoon
fonzannoon's picture

Take Belgium completely out of the equation and foreign ownership of UST's keeps blowing through new record high's. 

Thu, 07/10/2014 - 07:51 | 4942654 GetZeeGold
GetZeeGold's picture




Thu, 07/10/2014 - 08:03 | 4942680 fonzannoon
fonzannoon's picture

The portugese banking system is going down as we speak. You don't have a lot of time. You can stay on here or makes jokes of you can pile into gopro and petsmart. It's your call.

Thu, 07/10/2014 - 08:08 | 4942687 GetZeeGold
GetZeeGold's picture



Well.....just send them to Mexico and they can come in through the southern border like everyone else.

Thu, 07/10/2014 - 08:17 | 4942705 dontgoforit
dontgoforit's picture

You guys are a trip!  Thanks for the Terrible Thursday tink-a-bout.  A good laugh makes the bitterness a bit more palatable.

Thu, 07/10/2014 - 08:03 | 4942679 Keltner Channel Surf
Keltner Channel Surf's picture

Belgium's TSY purch's for unnamed hoarders have been well-hidden . . . in Marouane Fellaini's afro.

Thu, 07/10/2014 - 07:38 | 4942619 firstdivision
firstdivision's picture

Draghi will announce a QEzooka over the weekend, cause someone has to buy the dogshit bonds.  I'd be willing to bet that the ECB has been busy with the Belgium proxy lately planning it.

Thu, 07/10/2014 - 07:16 | 4942559 El Hosel
El Hosel's picture

Yellen is Sellin, "its not the Feds job to pop Bubbles" ....    Operation "last one out" is a go.

Thu, 07/10/2014 - 07:17 | 4942561 insanelysane
insanelysane's picture

CNBCBS is reporting everything is fine.

Thu, 07/10/2014 - 07:20 | 4942566 GetZeeGold
GetZeeGold's picture



Let's just hope they don't reco gold.

Thu, 07/10/2014 - 07:23 | 4942579 Headbanger
Headbanger's picture

Don't worry, they will just like before.

Thu, 07/10/2014 - 08:46 | 4942770 GetZeeGold
GetZeeGold's picture



Thank you!!! 


It's sooooooooo annoying.......right?

Thu, 07/10/2014 - 07:23 | 4942577 booboo
booboo's picture

Everything is always fine until it ain't.

Thu, 07/10/2014 - 07:25 | 4942581 insanelysane
insanelysane's picture

Steve "Master Blasta Sunshine Up Your Ass" Liesman is on the comm this morning and will probably be pulling a double shift.  I'm sure Cramer will be on later with a BTFD shirt on.

Thu, 07/10/2014 - 07:36 | 4942614 1stepcloser
1stepcloser's picture

all is well ...per Kevin Bacon

Thu, 07/10/2014 - 08:24 | 4942721 Eyeroller
Eyeroller's picture

And the majority of comments are saying BTD.

Thu, 07/10/2014 - 07:18 | 4942563 WTFUD
WTFUD's picture

' Oh what a tangled web they weave when. . . . . . '

Thu, 07/10/2014 - 07:28 | 4942589 ParkAveFlasher
ParkAveFlasher's picture

", bitchez!"

Thu, 07/10/2014 - 07:20 | 4942568 insanelysane
insanelysane's picture

Hitting peak f-tard.  President says he is not going to border because he hates photo ops.  Of course he was doing photo ops of turning down weed yesterday.  I'm sure there willl be a poll later today showing 50% agree that the President hates photo ops.

Thu, 07/10/2014 - 07:35 | 4942605 Manthong
Manthong's picture

The C.I.C. (Choomer-in-Chief) probably had a hard time declining that generous offer.

On second thought, he probably just rushed back to a bong on Air Farce One.

Thu, 07/10/2014 - 07:37 | 4942617 NoDebt
NoDebt's picture

The "refugees" could not pay the $10,000/plate fundraising fee.  So he took a pass.

Thu, 07/10/2014 - 08:50 | 4942781 agstacks
agstacks's picture


Thu, 07/10/2014 - 07:57 | 4942665 ThisIsBob
ThisIsBob's picture

Barry gets the good shit, no need to hit on street weed.

Thu, 07/10/2014 - 08:08 | 4942689 ParkAveFlasher
ParkAveFlasher's picture

He does that purple crystally shlt that comes in a vial.  And that is what makes him an easy marionette.

Thu, 07/10/2014 - 08:19 | 4942711 dontgoforit
dontgoforit's picture

I'm sure the secret service can provide him with whatever himself desires.  Man burger or blow.

Thu, 07/10/2014 - 07:23 | 4942576 Eyeroller
Eyeroller's picture

Will be interesting to see what happens today...

All those muppets who knew the feel-good Gubmint numbers were shite, but decided to 'go with the flow' and reasoned they could get out in time...

Thu, 07/10/2014 - 07:24 | 4942578 Baby Eating Dingo22
Baby Eating Dingo22's picture

Praise the lord for circuit breakers and bank holidays

Market will shut down by noon, "to allow calm and brainwashed heads to prevail."

Thu, 07/10/2014 - 08:07 | 4942686 AdvancingTime
AdvancingTime's picture

I agreed ugliness lies ahead. I love the way a drop is always being kicked out a year or two and never going to happen tomorrow. It is as if we can't handle what is coming at us and need more time.

For a long time I have been trying to develop a scenario for a market "super crash" and a reasonable map that would arrive at such a situation. Below is an article looking at how it could happen sooner rather than later.


Thu, 07/10/2014 - 08:21 | 4942714 dontgoforit
dontgoforit's picture

The condemned prisoner never wants to take that 'dead-man-walking' stroll for the last time.  Pray, pray, pray.  No respite.

Thu, 07/10/2014 - 07:25 | 4942580 glaucon was right
glaucon was right's picture

Black swans flying low this time of the year

Thu, 07/10/2014 - 07:27 | 4942585 insanelysane
insanelysane's picture

Middle East is on fire, ISIS has radioactive material, yet price of oil is dropping.  Nothing to see here, move along, and just buy.

Thu, 07/10/2014 - 08:22 | 4942717 dontgoforit
dontgoforit's picture

Tipping point for supply/demand.  Too many can't afford $4/gal gas - EBT & SNAP only goes so far, you know.

Thu, 07/10/2014 - 07:28 | 4942588 stant
stant's picture

But laggards ouiji board said July 20 th.

Thu, 07/10/2014 - 09:05 | 4942809 Tall Tom
Tall Tom's picture

It happens slowly and then all at once.


Give it some time...some time...10 Days...some time...

Thu, 07/10/2014 - 07:33 | 4942596 agstacks
agstacks's picture


Thu, 07/10/2014 - 07:36 | 4942613 GetZeeGold
GetZeeGold's picture



Oh you little you're locked in!

Thu, 07/10/2014 - 07:34 | 4942604 strangeglove
strangeglove's picture

Shit meet Fan!


Thu, 07/10/2014 - 07:37 | 4942615 Bernoulli
Bernoulli's picture

Not possible. It's a special kind of 360° spherical fan that spreads the shit all over the place.

Nowhere to hide anymore!!!


Thu, 07/10/2014 - 07:35 | 4942607 Bernoulli
Bernoulli's picture

But but...

... Super Mario said he would do whatever it takes? Where is he now?!? Can't he preach some more? Please! The disciples are waiting!

Well no chance. Sorry, guys.

The holy ghost (espirito santo) came to earth to crash the European Banking System.

Wow. What a story.

Thu, 07/10/2014 - 07:45 | 4942642 Bernoulli
Bernoulli's picture

Bonus irony:

The CEO of portugese Banco Espirito Santo is called Ricardo Salgado

Preços salgados means steep prices...

Basically he has written on his forehead: I am cooking the books here! And I am the boss of a bank called "holy ghost".

Ha ha.

Can't make this shit up....


Thu, 07/10/2014 - 08:23 | 4942722 dontgoforit
dontgoforit's picture

But, can he raise the dead?

Thu, 07/10/2014 - 10:16 | 4943100 IridiumRebel
IridiumRebel's picture

So technically his name in Ingles is "PRICE DICK"

Thu, 07/10/2014 - 07:35 | 4942609 firstdivision
firstdivision's picture

It would seem a great cry of "K-Hen, you're our only hope" could be heard coming from the eastern side of Long Island.

In otherwords, BTFD&ATH's

Thu, 07/10/2014 - 07:35 | 4942610 Everybodys All ...
Everybodys All American's picture

European banks are one thing and in this case it's a Portuguese bank. Just wait until a US bank is exposed in the very same way because I'd bet it's coming sooner or later. There have been little to no controls to speak of since the last cycle crash and most have concluded that Dodd Frank is all talk. I would also advance that many traders know this. Proprietary trading is the only mechanism many of these banks still use in order to make their earnings look well which exposes them all to huge risks with all the interconnectedness when markets go sour. To top it off the Fed has told banks to use two different books. One marked to market and the other they exposed to the financial press and we all know what that means.

Thu, 07/10/2014 - 07:39 | 4942626 Bernoulli
Bernoulli's picture

So so true.

Or wait til Deutsche Derivatives get exposed. Then we will see how the "netting" really worked...

"But banks are so much better capitalized than 2008, aren't they?!?! Wait WHAT?? you are saying this was just a book-cookers trick?" :-o

Thu, 07/10/2014 - 07:38 | 4942620 Seize Mars
Seize Mars's picture

Ok this thing is a fucking powder keg. It's only a matter of time before a real liquidity panic has equities vaporizing (not just "going down,") and bonds will be sold to meet various collateral requirements.

The bond market is as fake and weak as it gets. And it's just a matter of time before it fucking disappears. One day you will wake up to no offer in swaps and no bid for bonds.

There will be neither in stocks.

Thu, 07/10/2014 - 07:54 | 4942659 Unknown Poster
Unknown Poster's picture

DB has a 50 Trillion "matched book" derivative exposure. Santo is probably a counterparty to some of those positions. If they do not post collateral to be rehypothecated, then the book would be less matched. Panic time?

Thu, 07/10/2014 - 08:05 | 4942682 Seize Mars
Seize Mars's picture

Yes. I believe that DB is the weakest. They will blow up first. (Or first / again / still, whatever.)

Whether they get backstopped by the FED is anyone's guess. For whatever reason the AngloAmerican empire demonstrably wishes Germany ill and always has. (I didn't see Lehman being allowed to blow up either.)

Anyways it's on. The fuck up is that the ebola / Ukraine war / Syrian fiasco / "ISIS-CIA" 88 pound whatever hasn't really caused disruption yet. That's supposed to be first, then the financial panic. That's the only way to ensure fiat reigns afterwards.

Thu, 07/10/2014 - 08:11 | 4942692 Unknown Poster
Unknown Poster's picture

"Controlled collapse."

Thu, 07/10/2014 - 09:47 | 4943002 Hulk
Hulk's picture

You guys simma down now, everyone knows these things all net out !!!

/just like AIG...

Thu, 07/10/2014 - 07:39 | 4942624 Its_the_economy...
Its_the_economy_stupid's picture

Who wrote the CDS on this turd?

Thu, 07/10/2014 - 07:47 | 4942645 Seize Mars
Seize Mars's picture

Somebody who know's they're backstopped by the American taxpayer, That's who.

Thu, 07/10/2014 - 08:28 | 4942732 dontgoforit
dontgoforit's picture

The Elite of Ten.  Geo. Soros and friends?  Vultures and komodo dragons waiting for a dead body to consume.

Thu, 07/10/2014 - 07:40 | 4942629 agent default
agent default's picture

By looking at the action over the last few days, I would say that there are some attempts at slamming gold, but they are just not effective.  But the intervention is still there.

Thu, 07/10/2014 - 07:41 | 4942631 p00k1e
p00k1e's picture

This is great.  So exciting. 

Thu, 07/10/2014 - 07:43 | 4942639 GrinandBearit
GrinandBearit's picture

Now, if it can just stay down.

Thu, 07/10/2014 - 07:50 | 4942653 AdvancingTime
AdvancingTime's picture

If it is about contagion then it is about derivatives! The more and more I study derivatives it now appears the main goal of QE may have been to hold up the underlying value of assets that feed into and support the massive derivative market more than help the economy.

QE has up to now stopped an implosion of derivatives and the resulting contagion and shock that would have spread throughout the financial system. In postponing this collapse the Fed has created a whole slew of new problems. More on this subject in the article below.


Thu, 07/10/2014 - 08:14 | 4942700 Comte d'herblay
Comte d'herblay's picture

One problem it didn't create is how to hold responsible those who created those derivatives at Bear Stearns, Lehman, Goldman, and other notorious banksters and charlatans.

Instead they have been permitted to keep trillions of ill-gotten gains, then to compound this atrocious ripoff of the people, have been paid more billions of printed and tax money, each and every month for the past 6 yrs. and counting.

Whole multigenerational Midas like fortunes and inheritances have amassed for a tiny few in the Wall Street Mafia and their families, and their tribe. 

If only the camel could peek under the tents of these banksters' assets, it is likely a Charles Bronson or a thousand of them would finally spring into action in New York, Singapore, and London. 

Thu, 07/10/2014 - 07:58 | 4942667 damicol
damicol's picture

Its time to rock n' roll boys and girls


 Get those shorts lined up on every fucking  bubble you can see .

These mothers are going down, down I tell ya

tra la la la

tra la la la la

Thu, 07/10/2014 - 07:59 | 4942669 Ban KKiller
Ban KKiller's picture

Digg the rigg, jigg the books double time quick. Bad debt is REALLY on sale!

Euro, including Portugal, is  having a fire sale, don't block the exits.

Thu, 07/10/2014 - 08:10 | 4942691 AdvancingTime
AdvancingTime's picture

Do not expect a solution to come out of Europe. The Euro-zone is engaged in a talkathon, with fear of an immediate collapse off the table the members of the Euro-zone much like their political counterparts in America just talk about solutions without any action. For us in America news from across the pond dribbles out in small doses with almost daily media boost of promises that things are getting better. For more on all of "what is not happening" see the article below.

Thu, 07/10/2014 - 08:53 | 4942772 highly debtful
highly debtful's picture

Talkathons are the Eurozone's solution to whatever problems come its way. It is a well known recipy involving complex concepts such as "buying time" and "not on my watch". Or did you fail to notice how much implosions Draghi has already nipped in the bud just by talking? Any time he open his mouth, things cool down instantly.

Until one day they won't, of course. But that's not an exclusively European issue. And in the end, it won't matter one bit if the slide began in Europe, the US, China or the kingdom of Tonga. We'll all go down together just the same. 


Thu, 07/10/2014 - 08:16 | 4942703 NEOSERF
NEOSERF's picture

Futures already coming back...QE taper stop is creeping into mindset...Green by close like the good ole days of 2009-10

Thu, 07/10/2014 - 09:33 | 4942939 TabakLover
TabakLover's picture

I don't think so..... I thnk the dip buyers take it in the azz today.  Maybe a bounce at SP 1930.  We'll see.

Thu, 07/10/2014 - 08:16 | 4942704 css1971
css1971's picture

"which is great news for all those who plodded through months of centrally-planned boredom and artificial stability"

Months? Seems more like years...

I've been getting crushed on my VIX position, it's only bloody mindedness that I still hold it and though you've got my hopes up, I don't really see that ending yet. I mean honestly, they'll just debase a little more and give the losers the cash they need to plug the holes.


Thu, 07/10/2014 - 08:27 | 4942729 yogibear
yogibear's picture

Europe keeps bailing out the PIIGS until Europe goes down. A slow grind down. A controlled crash of the Euro.

Thu, 07/10/2014 - 08:29 | 4942733 RiskyBidness
RiskyBidness's picture

Obama opened his dumb mouth yesterday.....touting the economy......spewing bullshit.......and voila the futures tumble.

This guy could come out today and say the sun will rise in the east tomorrow and I would take the other side.  Everything this

man touches or talks about it turns to shit.

Thu, 07/10/2014 - 08:35 | 4942743 GetZeeGold
GetZeeGold's picture



Looks like someone doesn't worry about being shunned by the White House press corps.

Thu, 07/10/2014 - 10:58 | 4943274 lakecity55
lakecity55's picture

He is the Original Shit.

The prototype shit.

The event horizon of shit

you get the idea....

Thu, 07/10/2014 - 08:33 | 4942741 Temerity Trader
Temerity Trader's picture

Yeah! Yeah! Been here, done this. ZH’ers seem to never learn.  Bears all pile on with short positions and inverse ETFs, and Janet starts laughing. “Get that, “Fed may pause taper due to slight problems in Europe” story ready for the WSJ” Their puppet runs the story and Dow soars 250 points the next day.

Thu, 07/10/2014 - 08:36 | 4942744 Uncle Remus
Uncle Remus's picture

Yeah baybee.

[clink, clink, clink - sound of stacking]

Can you long the shorts?

[Fucking Barbarians...Bailiff! Ready my sedan!]

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