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QE is Not Coming to Europe… and the ECB is Out of Ammo
In the Summer of 2012, European Central Bank (ECB) President stated that the ECB was committed to doing “whatever it takes” to save the Euro and the EU.
Since that time, the ECB has cut interest rates even below zero (yes, the EU now has negative interest rates) and has implemented a large-scale asset purchase program.
All of these efforts have failed to kickstart the EU economy. Italy is back in recession for the third time since 2008. Germany’s economy contracted in the second quarter of 2014 and will likely be in recession before the first quarter of 2015. France has registered zero growth for six months now.
More telling is that fact that bad loans which now total over $1.1 trillion, an amount that as ZeroHedge has noted, is equal to 9% of Europe’s total GDP.
Between this and the ongoing insolvency of Europe’s banks (at leverage ratios of 26 to 1, one can reasonably argue that ALL major EU-based banks are insolvent), Europe’s last hope for success is believed to be a massive QE program in which the ECB buys sovereign bonds from EU nations.
However, this is unlikely to occur. If you think we are merely stating this because we are bearish on Europe, consider what Ben Bernanke told CNBC yesterday.
Former Federal Reserve Chairman Ben Bernanke predicted that the European Central Bank (ECB) would have a rough time implementing U.S-style monetary easing.
Speaking Wednesday at the Schwab IMPACT conference, the ex-central bank chief said the ECB faces political barriers to enacting such an aggressive program.
"The barriers to doing it are not really economic," he said. "The legal and political barriers being thrown up are going to make it very difficult to do that."
http://www.cnbc.com/id/102156211
Bear in mind, this is the same man who grew the Fed’s balance sheet from $800 billion to over 3.5 trillion, the man who personally oversaw multiple QE programs that directed money to European banks (the Fed’s QE 2 and 3 cash mostly went to European banks).
And he is openly stating that the ECB will find it “very difficult” to implement a QE program.
The European markets are deep trouble.
EU financials are already cratering:
Spain’s recovery is over:
Ditto for France:
Even the German “powerhouse” is breaking down:
The next round of the EU crisis is just around the corner. Are you prepared?
If you’ve yet to take action to prepare for the second round of the financial crisis, we offer a FREE investment report Financial Crisis "Round Two" Survival Guide that outlines easy, simple to follow strategies you can use to not only protect your portfolio from a market downturn, but actually produce profits.
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Wait... weren't we supposed to be seeing the crash of the US stock market right now now... oh wait.. maybe it's Europe right now... more predictions, huh...
All the Germans need to do is get their gold back. .. ooh wait...
Hell, even Walmart is out of ammo. You should see the lines when 22 ammo is in stock there. It sells out in 2 hours or less. Stock up on ammo while you can. Oh, fuck the ECB; there shouldn't even be a European Union. Bruxelles is a corpse and doesn't know it!
Deutsche bank? Fuck you!
Sometimes simple is best.
Lol, Political Barriers to preventing QE in EU, you dummy Ben, political barriers are the easiest to remove, just let the markets crater for a few weeks and watch the political barriers collapse, Politicians have no back bone,not a single one of them, QE will occur.
Greece has a secret weapon : the foot-long pita .
Like a NewYork Subway , but full of sweetness after you have burned out the rotten heart .
Also known as the Heart of Hesperides .
The blowtorch of love evaporates the hollow heart . Then fill it with confections of desire .
Can't do that in the EU .
Brussels specifies the temperature , and bans sugar .
And they want to rule the world .
See
https://www.academia.edu/9161420/Pita_as_Art
Once a RAT always a RAT. Ben says ' the barriers are not economic . . .
That's so fucking brazenly retarded a statement as you could get from a treasonous cunt sticking to his guns to the end.
He could just as easily have said, with the political will it would take 3 strokes on the computer to solve the EU's problems.
FANTASY LAND AND THIS CUNT@S NOT BUDGING WHILE THE $250k ( money earned for services in the call of duty ) jacket and tie affairs assure him and his a cozy retirement.
Dear PRC,
You do not have the inside scoop on Draghi and the ECB....matter of fact you dont now your ass from a hole in the ground you 2 dollar goldbrick hustler.
"However, this is unlikely to occur. If you think we are merely stating this because we are bearish on Europe, consider what Ben Bernanke told CNBC yesterday."
The ex-heeb chief said himself...
"The barriers to doing it are not really economic," he said. "The legal and political barriers being thrown up are going to make it very difficult to do that."
That means when suffering in EU starts to hurt the ECB will get to pumping, dipshit.
Arbeit macht frei
So you're the guy who stole that sign, Arbeit macht frei!
Germans dont want QE so they get negative interest rates.
There that feels better
the banker will now "help" only by continuing to try and trick people into believing in the future - so that they can sell their garbage into the greatest sucker's rally of all time.
and if doesn't work - the bankers will launch a new campaign to peronally campaign throughout europe raping and killing as many people as possible and stuffing the bodies of prostitutes into suitcases ... (AKA "Gods' Work)
Wait a bit .
This baby is still live and kicking .
And it does not need a stimulus now the little monetary tiff between Japan and US has ended (sort of)
This is good !
Taking in each other's washing is working .
See
https://www.academia.edu/9160541/Laundry_Economics_
or
http://andreswhy.blogspot.com/2014/11/laundry-economics.html
ml
suicide has always been the human way.
covert.co.nr
It does not matter either way the Euro-zone is Doomed with a capital "D". The euro-zone is in a far bigger mess than recent headlines and figures suggest. Most of the growth in the Euro-zone over recent years has been in Germany and that bright spot is now under pressure. Italy has been in recession for two years; France’s economy has been stagnant for months.
Now that Germany is in trouble, many economist think the chances of a Japan-style deflationary spiral have risen sharply. What it all boils down to is Germany can’t keep buying Greek bonds and other bad debt with German taxpayer money until the end of time. The article below looks at the corner Central banks have painted economies into by attempting to paper over reality and how these polices will hinders growth for as long as the eye can see.
http://brucewilds.blogspot.com/2014/10/global-economic-malaise-due-to-debt.html
Dude, get yourself a real website and then post something new on it rather than bombarding everyone with this recycled crap you are always regurgitating. Google isn't impressed by links inside discussion threads.
"... the ECB becomes a corresponding Fed in the European area, 'serving' the problematic economies that are excluded from the bond markets, through the print of new money. Therefore, the problematic economies will be loaded with more and more debt which the ECB, i.e. the largest private European banks will hold."
http://failedevolution.blogspot.gr/2012/09/lea-jacta-est-by-emperor-drag...
How is it that the US would IMPLODE/Disinegrate without QE and the EU will have to do without it ???? Did the US buy up all their bad debt??? The ECB did not QE the EU but the US did, is that what happened? If the EU has existed without it WHY did the US QE and create all the debt? Surely we were no worse off than most of the EU.
Have you ever played that little game with 3 cups and a pea, all smoke and mirrors, stop trying to be rational.
You know the Euro is "backed by gold".
So where is the "gold"?
Rut roh!!
60% of the Euro is USD from past reserves
Like watching a train crash in slow motion .
The EU was born and lived by monetary union .
Now it is dying by monetary disunion .
A day late and a Euro short .
A pity .
See
https://www.academia.edu/8816411/Rogue_Swan_EU_disintegration
The ECB will print..guaranteed. Markets will soar and Draghi will be feted as a hero. The irony will be that the very policy lauded as it's saviour will be the one that brings the curtain down on this ridiculously ill-conceived construction.
If one understands that the euro intends to function as a transactional currency only and does not intend to act as a store of value then the actions of the ECB start to make sense. NIRP is telling people not to use the banks to save. Cyprus was telling people the banks are ot safe, find another way to save. Keeping 10,800 tons of gold on the balance sheet is saying: ' hey, this gold thing works for us, maybe you should try it'.
Of course none of this makes sense if the only meme that you will hear is : 'the bankers are evil and planning to take over the world'.
Is that paper or physical? You bring up Cyprus and then ignore this point about possession being 100% of the law when fraud is the status quo.
Good luck with that cognitive dissonance.
The gold is separate entity on the ECB balance sheet... it is used to balance the printed euro.. i.e. the more Euros they print the higher the gld price go ... balances each other.. Gold nad Euros are decoupled and complementary... (i.e. the problem for the Euro is not the currency per se, but the politics)
Plus as far as I know there is NO TAX on gold in the Eurozone.. so you can use it for saving.
In comparison USA gld is locked at $42 i.e. it does not act as balance to the issued currency (They could do it postfactum, but the difference it that this will be credence hit for the $$ ) ... and the gold is TAXED in USA i.e. it is not as useful as saving vehicle.
Just wanted to point out this subtle but big difference in the approaches ...
Also because of the political situation it is harder for ECB to print..
Plus there is more $$ outside USA which can come back to flood the market.. (last decade CB $$ reserves dropped from ~67 to ~60...and dropping).
That is why if the Euro survives as a currency at the end of the day will be the stronger currency.
I don't see why even if there is some problems in the Eurozone they will want to part with the Euro !?! This has always been very US-centric doom&gloom view .. than a practical solution to the problem.
Euro in my opinion is better designed to handle Eurozone than Dollar to handle the World.
The Triffin dilemma is less applicable to the Euro, than the $$.
just my 5c
Gold is taxed in the Eurozone.
Really, In all the Euro countries ?
Do you have some link ?
I was with the impression that only Silver was taxed.
Triffin, my ass. Where is Europe's gold? Who is holding it? The same guys that are holding Europe.
Western Europe is a subject state of the Anglo-American-Israeli empire. Do you think the empire will sit by while it dies and it's puppet survives? No way, chief.
Soros just made it plain. Europe is to sacrifice itself, again, in a European war. Get your fucking boots on.
I can ask the same question : Where is US gold ?!
Blah, blah, Euro, blah, blah.
How many Euro troops occupy the US?
Why should draghi ruin the Euro. The Fed had no choice but he does. The Euro will survive when the dollar goes.
What part of total dependency on the FED or occupation troops don't you understand?
What part of all fiat goes to zero don't you understand?
Different paths, different alternatives on each curve.
They all will go to zero, and they know it since the begining. But at different paces...
Make your bets. They're part of the process, like it or not.
Yes, all fiat economies will glide lower now. Some may dip and dive, rise and fall, but downward glide path.
Some will be more decrepit than others...Japan has a 20 year head start.
Germany, England and Switzerland will probably be the least impacted.
"All of your fiats is belonging to me!"
MD
Bullshit. ZIRP is by definition printing money for FREE (no interest).
that's cocaine. but they want crack and heroin and crystal meth, too
"The legal and political barriers being thrown up are going to make it very difficult to do [QE]."
LOL Consider the legal and political constraints in the US circa 2004. Europe will be given 2 choices QE or war.
Europe does not do QE or war very well, very tepid.
They might start throwing pastries at each other but that is about the extent of it.
Maybe they will shut their borders and just go home and stew for a few years.
It would be shocking for any military action...yes they will position and show-off, but nothing will come of it.
They will rant and throw slurs.
http://www.youtube.com/watch?v=wdd9tqnWa7E
I didn't say Europe would fight. The war will take place on European soil. After everything is smashed up and millions are killed, then "statesmen" will step forward and make the peace.
Peace in our time, but first....
After Japan it is Europe's or China's turn, then back to the US. Then back to whoever is "ready" for the next round.
"QE has always been the policy of Eastasia."
Germany remains of the view, expressed most recently last week by Herr Schauble, that printing money does NOT produce economic growth. Which is, of course unfashionable amongst CB's yet demonstrably correct after the experiments with QE in The US and Japan. Einstein's definition of madness rings true again....
Of course QE doesn't produce economic growth. Everyone knows that, QE saves big banks, like Deutsche Bank.
Germany is a vassal state,
Let the printing begin in Europe!!!