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ECB's Nowotny Blames "Massive Failure Of Market Analysts" For Last Week's Unprecedented Hedge Fund Losses
Having jawboned markets beyond a point of no return, and leading to massive hedge funds losses described previously as a result of everyone being on the same (short) side of the EUR trade only for the ECB to disappoint, sending the EUR soaring the most in 6 years, the ECB seems unable to get over what many have dubbed its biggest communication snafu yet and continues to openly insert various feet in its various orifices.
The latest to confirm the ECB is still having nightmares about its Thursday decision was Austrian Ewald Nowotny who said markets failed to assess properly the signals the European Central Bank was sending last week, adding that analysts rather than the ECB were to blame for any misunderstanding.
Which, of course, is ironic since it was both Draghi and Nowotny who well into the leadup to the ECB meeting were aggressively talking down the EUR only to subsequently admit they have no firepower left to actually back up their relentless, and ridiculous, jawboning.
Reuters reports that when asked whether the ECB needed to review its communication strategy in light of the market reaction, Nowotny said the ECB had done nothing wrong.
"I think it was really a massive failure of market analysts," Nowotny told a news conference, adding that those analysts should have paid more attention to economic fundamentals. Which ones would that be: the -0.1% inflation reported for September "rebounding" to solid 0.1% for October and November? Or the 50% youth unemployment in Spain and Greece?
"I do not think that the communication policy of the ECB sent the wrong signal," he told reporters, adding: "There were exaggerated expectations in relation to the actions taken by the ECB in this situation. They were clearly exaggerated."
Yes, thanks to Draghi and, drumroll, Nowotny with such soundbites as the following from November 2:
- NOWOTNY SAYS `ECB HAS TO ACT' AS INFLATION TARGET TO BE MISSED
While the markets had failed to understand the ECB's guidance, Nowotny said the ECB should not let itself be influenced by signals sent in the opposite direction.
The comedy continued when Nowotny said that "the ECB can and will not let itself be pushed by the markets," adding that "it’s not our job to correct wrong expectations of individuals” and “it wasn’t the view of the whole market."
Which, of course, was a lie because it was his very boss, Mario Draghi who just last Friday launched a massive rally in the market, when asked by Mervyn King the ECB's chair's Friday speech was "deliberately designed to try offset some of the reaction yesterday?" to which Draghi had a response that shocked every central bank watcher in its brutal honesty that all that matters to the ECB at this point is the market: "Not really... well, of course."
Dear ECB, if you can't get your story straight, please at least coordinate your lies - you are starting to look very much like amateurs.
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Nobody could have possibly seen it coming /s
Wait...what?
Market Analysts caught being wrong.....were's my damn camera?
Stay there.....don't move.....I'll be right back.
What he really was saying (and anyone that listened to George Carlin knows):
"It's a big fucking club and you're not in it. The people that are in the club are told exactly what the central bank is doing. Those outside the club better guess right or be stomped."
Translation: We (Central Banks) only enable wrong doing. If someone pulls the trigger don't blame us. The same argument for guns. QE doesn't kill the economy, people do.
Since the ECB has been known to tell the hedge fund boys exactly what's going to happen it is a fairly ridiculous blunder. Seems like they got used to sucking on the inside information teat and can't predict anything without being told.
Nowotny is useless. Fire him. Make him a homeless beggar. Douche-bag.
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earth to nowotny: there is no market.
I hear christmas shopping in Paris is way down..wonder why?
Holy Sharia Batman !!
Interest rises add to inflation
Trouble is we cannot afford the present costs of usury.
The usury system affects the entire production distribution and consumption system.
Usury and the physical economic system is intertwined on a very deep level.
Usury costs need to be abolished to bring down the current massive costs of distribution.
Do you blame the jooos?
The jews are very much part of the usury system.
In the past and the present the royalty of each country used then to concentrate wealth in their hands.
King John's English turmoil is perhaps the best known event.
Do they control the system independent of Royalty today.
I have no idea.
But the introduction of laws divorced from the culture of lands points in this direction.
l
@ THE DORK OF CORK
Usury? Yes, I guess I'm being bent over on my 0% car loan? Or my 3.5% mortgage? Right - the man is really sticking it to me.
And just as an unrelated side note, assuming that any interest (apparently) constitutes usury to you, what do you suppose abolishing interest would do?
"Trouble is we cannot afford the present costs of usury." In that case, take a guess at how a free market would respond to consumers of debt being largely unable to afford the price of the debt? The price of that debt goes down. So maybe your energies will be better placed looking at how free markets have been usurped, manipulated, purposefully made lame rather than keeping your nose buried in your Keynes/Marx/Sraffa.
The usury The Dork speaks of is the monetary system kind.
Fuck me.
This Nitwit is off script.
Wait....
..........nope...off script.
Expect NoteNOTworthy to get a memo from some Bilderbooger to shut his Croissant Hole
You people crack me up.
The average Joe was attacked first and has been chased out of the markets. Joe will not come back. The markets are a fraud.
The hedge funds and those putting their money in hedge funds have been led to believe that they are elite insiders. But that is not true. They are useful idiots to be used by those who run the system and the majority of the world.
Now with average Joe out of the markets, the only refuge for the hedge funds is the banks and the banks can turn on the hedge funds with impunity and the hedge funds and their investors have nowhere to turn. They cannot sell to Joe because Joe has been chased away.
So sad, too bad.
Average Joe never traded currency futures. This is purely bank-on-bank fucking.
the American Average Joe? possibly correct... but not correct in the UK
plenty of smartphones with betting apps going from FX futures to spread betting, horses, etc... in the same app
So british gamblers are mad that they lost a bet? I'm happy to see that the Brits treat this shit as gambling, but let's not get upset when your gambling bets go bust. Try working hard for a living. It feels good!
Dammit....smarter than average Joe is on to us.
Just look busy....we'll figure something out.
Send the new guy up from the mail room....it's an emergency dammit.
@catallus, very little of those $billions in losses were via currency futures; most of it was in the FX inter-bank markets.
bah. the ECB can clad itself in as many similarities as possible to the FED, which btw could also be seen as a way to hoodwink the poor, poor analysts of the megabanks and their children the hedge funds...
... it still is a confed of european national banks, with tradition(s) of "though love" versus banks (and what they regard as speculation)
in fact, if the Russian National Bank would join this team, it's national bank governor would find itself in a like-minded environment (LOL)
anyway, I agree with Nowotny. And the reference to the enigmatic Draghi answer is neither here nor there, imho
When they can't manipulate markets to their liking it's your fault.
C'mon ZH... talking about HF vs ECB is talking about two clans of Oligarchs.
The HF REPRESENT, thanks to ZIRP/QE , the WS led Casino games of the last 20 odd years they play in the name of their Caymanista plutocratic clients, hidden in the interstices of the Shadow Banking cabal and fed by the TBTF who take their cut as GUARDIANS of the Fiat intercontinental hegemony.
The TBTF don't have to take the RISKS the HF have to take to make a living, since the shit has hit the fan in the real economy. They OWN the electronic cobweb of integrated finance and the HFT centres around Dark Pools.
The tug of war is now between the clever "techfin" type shadow bank mavericks and the desperate statist front men technocratic class who are in charge politically of the financial TITANIC, nominally in name of "we the people".
Those bureaucrats and their POLITICAL bosses are now at loggerheads with shadow banking!
Its an awesome tug of war as the interconnecting web now goes nationalistic to protect local vested interests.
WHY ? Simple ! There AINT enuff gravy to feed all the five families of World Oligarchy. And something has to give.
SO why take sides? The market is a bunch of crooks and the statists are another bunch of crooks. We aint invited to their mad hatters party (except as commentary).
'Cos we are in the duck soup.
I'd say that TPTB are still using that ole OSS playbook.
Market Analysts being found out by the general public, they were nothing more than a bunch of lying bastards selling the great-lie, should be the caption. Slowly but surely, the Great-Unwashed are waking up to the lies, fraud, complete manipulation and rigging of the so-called FREE MARKETS, A.K.A our entire financial system. In another 3 years the Great-Unwashed will slowly realise not one scumbag has been convicted except the low lying fruit(who never happens to be Jewish), including the fact these shysters are politically protected from up high, by that time it will be too late and most of the dual-citizen criminals will be living in Tel-Aviv.
Of course it was the analysts who did it.
Isn't it the weatherman's fault when it storms?
Someone was on the opposite sides of the trades, so half market didn't fail. Go figure.
yes, but it was the wrong half, you see? specifically, it was the "Parity Alliance", and some of them are nursing bleeding bets on Parity since practically the EUR was born
The only part of the rump Irish domestic economy to get credit post crisis was the Dairy sector.
It engaged in specialised mercanti.
le export activity as we could not afford domestic production as the usury costs were too great.
Export activity is used to offload the costs of superproduction.
The Dairy sector is now in massive crisis as its export markets are drying up.
This is not the first time this happened.
We had the historically recent 1970s overinvestment 1980s agricultural bust.
But a even bigger event happened after the Napoloneonic wars...all very similar.
It just keeps repeating.
Te E
Dudley and Yellen time for your tanks in the street skit to bail out the heggies. To go along with Goldman's Draghi statment that we will do whatever it takes statement.
Old greedy bastard talking.
As if failed market analysts are to blame for this mess.
Just hire some unemployed CASINO ANALYSTS.
Where's Beeks? Where in the hell is Beeks?
Do not look at these problems from the prism of finance capitalism
That is a mistake.
The problem is much simpler then their magicians tricks.
The function of production is consumption
This raising of distribution costs (financial Friction) causes production to become unaffordableble.
In some ways it really is this simple.
ECB's Nowotny Blames "Massive Failure Of Market Analysts" For Last Week's Unprecedented Hedge Fund Losses
When does a politician admit a mistake = 0
When does a politician not keep taking your money = 0
When do you ever need a politician = 0
So now all the hedge funds learn how their master is like. Their master is an unpredictable moody sociopath.
Same way SNB told they will DEFEND the EUR/CHF CAP,ONLY to pull the plug later
Lessons...?!
Dogs bark, babies cry, central banksters and politicians lie.
Why would anyone be surprised?
When CBs get petulant, it's time to disband them and start over.