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When Stress Tests Fail - Italian Banks Are Collapsing
Despite the ban on short-sales - which has never worked in the past to do anything but instil fear in traders' holding long positions - Italian banks are in free-fall following the utter failure of Draghi's stress tests to encourage confidence in the European banking system.
- INTESA, UBI, UNICREDIT, MONTE PASCHI SUSPENDED IN MILAN, LIMIT DOWN
Given the post-"whatever-it-takes" world of domestic sovereign bond-buying, it is no surprise that Italian govvie risk is jumping higher and the FTSEMIB is plunging.
“A relief rally would not be justified,” said Michael Woischneck, a portfolio manager at Lampe Asset Management in Dusseldorf, Germany. “There are still a lot of problems to fix, and Italian banks still have a lot of work to do. Even for the banks that passed, what is there to be relieved about? They still have to find a business model and figure out how to get unanswered questions that a stress test just cannot answer.”
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These a stressa tests givin me a lotta stressa!
Is this Europe's Lehman Bros. moment? I hope so. My shorts are waiting! (Or am I going to take it in the shorts?)
No, no it is not a Lehman moment. We have seen this before since 2008 and we are several hundred points higher on the S&P. As long as the banks can mark to fantasy we will not have a Lehman moment.
"As long as the banks can mark to fantasy we will not have a Lehman moment."
Spot on, Doc. I'll even add a qualifier to that...the banks "mark down" assets then find yield-chasing buyers to purchase those assets at inflated values. Banks will actually book a gain on the sale if it's above whatever fantasy number they carry on there books. Some (private) banks out there are reporting earnings from the sale of these distressed assets that far exceed their core business. This is amplified when banks fail since whatever institution lined up to buy the failed bank's assets gets such a bargain, via "mark to market" fantasy and loss share agreements with DC. So long as this circle-jerk continues, there will be no Lehman moment.
Dying banks with lots of dying banksters.
I have a question/observation regarding the dying banksters, such as the two recent "suicides" from last week: Of all these so-called "suicides", has anyone really been proven to be dead?
What I'm wondering is if all of these people are really dead or not? Could they be disappearing themselves? Are they being helped to disappear, have their identities changed, and living almost under a witness protection program somewhere?
Maybe most of these people are dead and were actually murdered for what they might know or who they have or would tell if being investigated, etc.
But maybe some others are being mixed in amongst them as suicides as a cover and are disappearing so that they can keep from being "suicided" for real becuase of what they know, have done, or who they have told.
I wouldn't be surprised to find out at least a few aren't really laying in a pine box 6 feet under. Probably some homeless person's body instead. Or...are they all being creamated in order to cover things up further?
All "suicided" banksters who are supposedly buried should be exhumed and DNA verified that they're actually dead and buried. Otherwsie I'm thinking some of them are being helped to slip throught he cracks and are now living life as somebody else in relative obscurity.
Wya putta outta da dirty laundry !
Dis-Stressin !
'Course they may have been rubbed out
LONG AGO and the news of their "resignations" is merely being trickled-out at an acceptable but easily-forgotten tempo !
I wonder why all of tyler's charts are in sharp declines this morning. think it might mean something?
Hey watsa matter you, you no lika da stress test? Hey! pizza pie for alla my friends!
The blame is being placed exactly where the ECB wanted it to be placed- on small banks, and banks that have already been on the radar screen of known-trouble-makers for 18 months or more.
Big banks have no problems. No, of course not. They're healthy, no trace of Balance Sheet Ebola with them. It's all still contained in 'West Africa' (southern Europe).
We need Gen Ackbar in this thread with the "It's a trap!" comment.
you forgot a third category. banks that have been "adviced" upon by The Squid. on other terms, how do you "stress test" a megabank? they are neither here nor there
how fucking bad are these banks if they cant even hit the softball that has been lobbed at them by the ECB?
card house
OG Italians are messin' with a EU !
Well I don't see any problem at all with the backstop from the FED. It's never failed to emerge. So expect the FED's QE(n) because the italian banks will not be allowed to fail.
So FED will show the salami or the Slim JimTM ?
Who will be the Italian Dick Fuld?
Mama Mia!
spaghetti available for the rome banksters waiting in line at the discount window..
prepare for a stop run coming out of fed meeting or earlier. looking for one more pop before more carnage.
http://www.bloombergview.com/articles/2012-05-23/merkel-should-know-her-...
Idiot from Dusseldorf
These banks cannot support the enormous amount of Italian debt.
Should the fail Italy will fail as well.
Unlike Greece there will be no bailout.
The numbers in Greece were much smaller.
This is their way to get the Italian gold...
too bad the whole thing is untradeable due to rampant persistent manipulation.
ppt bitchez
You've left out CARIGE !! Once a solid saving bank and now... http://www.reuters.com/article/2014/10/26/eu-banks-banca-carige-idUSI6N0RW02920141026
Best way to rob a bank is be a banker. Be a corporate raider of reserves and transfer those to off-shore accounts and cry bailout.
You as a banker end up outrageously wealthy while the central banks end up bailing out all the funds you swindled.
Banker, act like a corporate raider. Your central bank encourages it.
Correct. However this pans out, and I don't claim to know how, the usual wide-boys will win and the usual fall-guys will lose.
This looks like the ECBs attempt to vaporize Italy so that it can buy the french banks and France more time before re inflation.
Again the nature of the capital investment in France points to a future inflation (if you believe that the french rather then the italian masons are the true insiders on this euro scam)
This will direct further remaining capital to France me thinks.
https://www.youtube.com/watch?v=Ug-SvG5QxC8
In 2014
Paris T6 & T8 opening in December.
Benascon tramway already open this year.
Le Mans T2 open.
T2 Tramway Valenciennois.
Grenoble tramway E
Aubagne tramway (3km)
I see more capital flight to the UK & France rather then Germany.
Germany is very much a colony of these two powers if you look at the nature of its mercantile production.
The objective as always is to concentrate power rather then distribute it.
PS
The reality on the ground.
France is running out of other peoples capital.
http://www.sudouest.fr/2014/10/27/tram-train-70-millions-d-euros-deja-engages-1716764-2774.php
'There eez- of course- this EU stabeelitee. Eez this understood? Italy is not Zimbabwe. We have this Bungazooka, you see. No further questions.'
Not happenin until a bankers fall out of the sky.
As Thatcher once said, 'The problem with socialism is that sooner or later you run out of other people's money'... and boy, have they run out of money!
Yeah but we still have lots of Banksters..... Let 'em fly....
Say what you want..but this is a nice FD to BT
If the mafia took over these banks the amount of NPL's would fall dramatically. They could really work
wonders in terms of cleaning up their balance sheets.
This is more of an effect of globalism than of socialism. Bringing in the zio-controlled China into the world market was designed to collapse it. Then, all the GS types can run around the world buying islands, villages, etc. for pennies. This is all a global design to bring on Global Gaza.
Yup,
Makes sense. Chinese zioqueers. Hymie Chong.
All part of the master plan.
Dang those evil smart guys who tricked you out of your billions by forcing you to buy your Fiat on credit with one of their secret member organizations.
If they do take over your village, however, I'm reasonably certain that your job will still be safe.
I remember when a nursing home gave my 99 year old grandmother a stress test. Gave her a heart attack instead.
Sounds like the BIS has always been in control. BIS now siding with the FED reserve over the ECB until the fighting begins. Then widespread war, famine and death. Rinse and repeat in 200 years.
Ah! You know how it goes in Italy.
"Whatever it takes" soon gets translated into "Whatever" !!
This article is wrong, the banks suspended are only two, MPS and Carige, the only two that have a capital shortfall. Considered that the banks in Italy (unlike their anglosaxon and german counterparties) did not need to be recapitalised in 2009/10 they did quite well.
I dont understand something. If the west, specifically US, print money till doomsday, then why worry at all? They will be bailed out regardless. Makes little sense to me.
RUN!!!!!!!
Mark to mark.............. like the Wiemar Mark.
It is ironic and only fitting that Italy is shaped like a boot. In many ways Italy could be viewed as the Achilles heel of Europe. Italy is loved and often the travel destination by many Americans and for good reason, it is downright charming, but it is also the third largest economy of the Euro-zone after Germany and France and yet it holds the largest public debt totaling over 2 trillion euro.
Almost everyone agrees that Italy’s public debt is unsustainable and needs an orderly restructuring to avert a default, but as usual in the Euro-zone no action is happening. More on why Italy may bring down the euro in the article below.
http://brucewilds.blogspot.com/2014/09/italy-achilles-heel-of-europe.html