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Add The Ukraine To List Of Countries On Verge Of Technical Default

Tyler Durden's picture


Update: the correct translation is that as of 5pm the debt has not been paid.

In this messed up post-Keynesian world which is so insolvent, it is virtually impossible to keep track of who is about to default, either technically, selectively, or really, who is already bankrupt, who is hyperinflating, and so forth. And while we all know that Europe and the US can at best hope to kick the can for a month at a time until finally they all have to face the truth, we are happy to bring to your attention the latest entrant to the technical default club: Ukraine, which will shortly join its former USSR satellite Belarus in the hyperinflation club. The fact is that the Ukraine is slowly imploding - the government had stopped Treasury payments for all budget expenses in an attempt to accumulate the cash needed to make a coupon payment on debt and which apparently investors are unwilling to roll. In all fairness, the news update indicates that the country just barely made the 5.3 billion hryvnia payment, but that may be it for now. What about the next one? Time to add some Ukraine CDS to that bankrupt sovereign basket, no matter how overflowing it may be at this point.

From, google translated:

A few hours of Ukraine may find itself in a state of technical default

 Since Friday, September 23, TREASURY stop the flow of funds for all treasury accounts at the central and local levels.


This is the Ukrainian Center for entrepreneurship with reference to this derzhustanovi.


VTSSPD believes that this situation indicates an attempt to accumulate the funds needed to repay the September 28, two series of bonds totaling over 5.3 billion USD.


"As of 17.00 on Sept. 28 debt is not paid. This suggests that within a few hours of Ukraine may find itself in a state of technical default" - said in a statement.

h/t Yaroslav


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Wed, 09/28/2011 - 14:59 | 1719280 Azannoth
Azannoth's picture

It's news that they where ever solvent!

Wed, 09/28/2011 - 15:22 | 1719369 Ahmeexnal
Ahmeexnal's picture

hmmm...ukranian stock exchange has no short ban?

Wed, 09/28/2011 - 15:43 | 1719455 Quadlet
Quadlet's picture

Dump BAC!!!

Wed, 09/28/2011 - 15:48 | 1719466 Herd Redirectio...
Herd Redirection Committee's picture

Check out the latest from the Capital Research Institute: "Consequences of a Trillion Broken Promises"

"In our world of ever-decreasing attention spans I better cut to the chase.  Greece is bankrupt, hence the solution for Greece is to declare bankruptcy.  Similarly,  America is a (bankrupt) de-industrialized nation well on its way to becoming a part of the Third World.  What marks the Third World, in my opinion, is the glaring wealth disparity, systemic injustice, and widespread corruption.  Corruption American-style is just a little more sophisticated.  Rather than bribe congressmen or government officials they are merely promised cushy office jobs once their terms are over.  See?  That way you accept payment for services rendered after wards, when you are out of the public eye, out of the limelight.

The way back, logically, to a prospering economy with a growing middle class then, is to bring back manufacturing.  Until that process is initiated we will continue the current cycle of ‘recession’ and (weakest on record) ‘recovery’.

The reason for being so forward is simple.  The opinions expressed here are rarely found in the mainstream media.  Why is that, you should be asking yourself.  Who doesn’t want to see America re-industrialized, and the Greece dilemma settled in a just and fair manner?"

Wed, 09/28/2011 - 16:06 | 1719518 Ripped Chunk
Ripped Chunk's picture

What was the middle part again?

Oh, right, shake it off. I'm shocked by this news!

Wed, 09/28/2011 - 16:32 | 1719590 PY-129-20
Wed, 09/28/2011 - 15:35 | 1719419 unerman
unerman's picture

It would be easier to take you seriously if you could spell.

Wed, 09/28/2011 - 15:52 | 1719481 Azannoth
Azannoth's picture

I always have problems translating my thoughts into the human language it's so inefficient

besides I don't give a fuk to begin with

Wed, 09/28/2011 - 15:45 | 1719460 jdelano
jdelano's picture

On the spuriousness of the liesman levered euro tarp plan.  Neatly sums up why "the plan" is complete hogwash.

Wed, 09/28/2011 - 17:10 | 1719780 Raymond Reason
Raymond Reason's picture

Ah the grievous hryvnia again.  

Wed, 09/28/2011 - 15:00 | 1719285 ded_moroz
ded_moroz's picture

Hey, Ukraine has been one of the favourites to default! How come we forgot about it.

Wed, 09/28/2011 - 15:44 | 1719459 Nascent_Variable
Nascent_Variable's picture

We know French banks are overexposed to Greek debt, but whose neck is out there with Ukranian debt?

I'm still parsing through this, but it looks like the US made a big push to buy Ukranian bonds back in '09.

Wed, 09/28/2011 - 16:23 | 1719558 mcguire
mcguire's picture

same thing.. old 2009 data, but this is a great interactive chart...

Wed, 09/28/2011 - 16:26 | 1719569 mcguire
mcguire's picture

also, wasnt part of the rumor mill on the PM sell off that some eastern european central banks were liquidating??  any relation to this story???


Wed, 09/28/2011 - 15:00 | 1719286 PulauHantu29
PulauHantu29's picture

The median yearly wage in the United States is just $26,261, but the average American household is carrying $75,600 in debt.

Read more:

Wed, 09/28/2011 - 15:12 | 1719328 AcidRastaHead
AcidRastaHead's picture

Don't forget about the $47,000 that is each American's share of the National Debt.

Wed, 09/28/2011 - 15:19 | 1719350 Comay Mierda
Comay Mierda's picture

more like $550k/person in with unfunded liabilities (social securiponzity, mediscamcare, etc)

Wed, 09/28/2011 - 19:21 | 1720204 Ahmeexnal
Ahmeexnal's picture

And the "more educated" they are, the more they owe.

A typical multi-PhD assclown is up to his eyeballs just on student debt.

Wed, 09/28/2011 - 15:16 | 1719291 gojam
gojam's picture

Ukraine or UK ??

Nevermind, the Greeks will be pleased if the Ukranians are the first domino to fall.

No doubt the story will go that Greece held lots of Ukranian bonds and their default has tipped them over the edge.

(cue sighs of relief in Eurozone, "Not our fault Guv")

Wed, 09/28/2011 - 15:04 | 1719299 Ineverslice
Ineverslice's picture

Ukraine is weak!!!

Wed, 09/28/2011 - 15:49 | 1719472 Ineverslice
Ineverslice's picture

L O L ......" ....I think it's time to put the hurt on Ukraine!"

Wed, 09/28/2011 - 15:20 | 1719361 PSEUDOLOGOI

Ukraine not weak!!! I crush you...

Wed, 09/28/2011 - 15:28 | 1719396 Ancona
Ancona's picture

"Ukraine not weak!!! I crush you..."

With my debt...

Wed, 09/28/2011 - 15:22 | 1719363 gojam
gojam's picture

Never heard the quote "And the last shall be first, and the first shall be last"

It's all pecking order. All countries will default but they will default in order of prestige and power. The USA, Germany, Japan, and the UK will be last.

Wed, 09/28/2011 - 15:36 | 1719423 Deadpool
Deadpool's picture

really??, because with QE I think your list already defaulted. Just haven't heard it yet on CNBC.

Wed, 09/28/2011 - 15:39 | 1719432 gojam
gojam's picture

QE is nothing but the US play to guarantee being last to default.

Wed, 09/28/2011 - 15:05 | 1719301 The4thStooge
The4thStooge's picture

Would a Ukrain default spread contagion all over the world and lead to financial armageddon?

Wed, 09/28/2011 - 15:06 | 1719304 mynhair
mynhair's picture

Who lends to them?  Georgia?

Will SPY claw back to 117.45?

Wed, 09/28/2011 - 15:42 | 1719449 korthaj
korthaj's picture

UkrSibbank» is the third largest bank of Ukraine, the second among foreign-owned banks.


BNP Paribas – 99.9%


...Pokes the domino tile.

Wed, 09/28/2011 - 15:06 | 1719306 Dick Darlington
Dick Darlington's picture

They probably called their Austrian lenders to give some more to make it through the day.

Wed, 09/28/2011 - 15:07 | 1719307 AcidRastaHead
AcidRastaHead's picture

Welcome to the party Ukraine.  Or is Ukraine like that party guest you're obligated to invite but pretty much ignore until they are at the door putting their coat on.  "Hey, glad you could come, sorry we didn't get to chat more."

Wed, 09/28/2011 - 15:37 | 1719425 Deadpool
Deadpool's picture

that'll be Turkey

Wed, 09/28/2011 - 15:07 | 1719309 Tsar Pointless
Tsar Pointless's picture

Technically, we in the "West" are all in default.

Except for Iceland.

Wed, 09/28/2011 - 15:07 | 1719312 Deadpool
Deadpool's picture

the bread basket of Russia...Putin will ready the tank divisions.

Wed, 09/28/2011 - 17:14 | 1719798 schadenfreude
schadenfreude's picture

Bread basket with nuclear weapons. Good luck with the tanks and Moscow

Wed, 09/28/2011 - 15:09 | 1719318 dick cheneys ghost
dick cheneys ghost's picture

How is South Korea CDS?..............

Wed, 09/28/2011 - 15:09 | 1719321 Dr. Kenneth Noi...
Dr. Kenneth Noisewater's picture

Technically default, that's the best KIND of default!

Wed, 09/28/2011 - 15:09 | 1719324 Sokhmate
Sokhmate's picture

I'm guessing their export of Ukranian nurses is not that lucrative.

Wed, 09/28/2011 - 15:13 | 1719332 Momauguin Joe
Momauguin Joe's picture

Charge them a baggage fee everytime they fly back from the Hamptons.

Wed, 09/28/2011 - 15:11 | 1719326 hunglow
hunglow's picture

Russia must be happy.

Wed, 09/28/2011 - 15:21 | 1719364 PSEUDOLOGOI

for now... maybe they are... but they have a number in line too...

When the shit hits the fan, watch Russia be unable to deal with seperatist movements and even out right Chineese land grabs...

Wed, 09/28/2011 - 15:12 | 1719327 Zero Govt
Zero Govt's picture


"Add The Ukraine To List Of Countries On Verge Of Technical Default"

Ok TD, will do...

Ukraine : Govt-led country led into bankruptcy toilet (New)

Greece : Govt-led country led into bankruptcy toilet

Ireland : Govt-led country into bankruptcy toilet

...hold on, hold on TD ...wouldn't it be easier if you gave us the much smaller list of countries not led by their Govts and Bwankers into the sewer of bankruptcy?

I mean there's actually only a few countries in all history that have not been ruined by the State and Bwankers in bed together

Govt : the Biggest Social & Economic Mistake in a Mellenium


Wed, 09/28/2011 - 15:24 | 1719375 SheepDog-One
SheepDog-One's picture

Ukraine, Ireland, Greece, put together still tiny compared to just California looming default.

Wed, 09/28/2011 - 16:30 | 1719584 Zero Govt
Zero Govt's picture

Look Tiny Tim said Europe couldn't/wasn't going to happen in America... what greater certainty is there in the modern World than a Tiny Tim guarantee?

...ok now I've passed The Feds new 27 word-checker Big Brother Blogging Software any ideas how to short the fuck outta Tiny Tim and California??

Wed, 09/28/2011 - 19:26 | 1720211 Ahmeexnal
Ahmeexnal's picture

Scheisse-wigger paid off all of Kali's debt with Austrian notgeld!

Wed, 09/28/2011 - 15:15 | 1719341 falak pema
falak pema's picture

It is a damning truth which has to be regarded in the face; all those who believed in the 'Orange revolution', promoted by the west, saw a type of corruption that matches that of Russian OLigarchs. The western model of crony capitalism is as demented as totalitarian soviet dictatorship. The so called capitalist cartel mafias run Ukraine, like the two frontiers of western civilization. From the halls of Montezuma to the shores of Tripoli... it smells, it smells of corruption, like during the time of Conquistadors and Crusaders.  We have learnt nothing.

Wed, 09/28/2011 - 15:19 | 1719356 disabledvet
disabledvet's picture

Send in the hottie with the cool hair-doo!

Wed, 09/28/2011 - 15:23 | 1719374 Shitters_Full
Wed, 09/28/2011 - 15:25 | 1719386 SheepDog-One
SheepDog-One's picture

Isnt that the chick from 'Scrubs'?

Wed, 09/28/2011 - 15:30 | 1719404 BandGap
BandGap's picture

Swiss Miss Instant Cocoa

Wed, 09/28/2011 - 16:19 | 1719549 Ancona
Ancona's picture

.....with mini marsmallows....

Wed, 09/28/2011 - 15:30 | 1719406 JW n FL
JW n FL's picture



She is in Jail for corruption in the Gas Pipeline deal(s).


Wed, 09/28/2011 - 16:16 | 1719542 disabledvet
disabledvet's picture

Rapunzel! I'm coming for you Rapunzel!

Wed, 09/28/2011 - 15:50 | 1719474 hunglow
hunglow's picture

Luke Skywalker's girl.

Wed, 09/28/2011 - 16:13 | 1719539 disabledvet
disabledvet's picture

She looks real good with her hair down. Rrrrrowwwww. I sense a "default is actually ok" moment coming!

Thu, 09/29/2011 - 03:53 | 1721055 NZ Watcher
NZ Watcher's picture

She's a bitch and a greedy self for filling cow

The likes of her and a number of other thieving pirates is the reason Ukraine is in its financial situation

They did't call her the Gaz Princess for nothing

Wed, 09/28/2011 - 15:41 | 1719444 Missiondweller
Missiondweller's picture

I don't think that party has been in power for quite a while now. The gov is full of Soviet cronies now.

Wed, 09/28/2011 - 15:16 | 1719347 BlackSea
BlackSea's picture

Well, this should make for an exciting Euro 2012 soccer championship next year...

Wed, 09/28/2011 - 15:17 | 1719349 disabledvet
disabledvet's picture

Those hernia payments are a bitch. Trust me. At least they're still allowed to join a club. Some people aren't so lucky you know!

Wed, 09/28/2011 - 15:19 | 1719358 TheLooza
TheLooza's picture

They'll be fine. Ukraine is exporting some of the hottest anal-loving porn stars of this millenium.  I go long their CDS (c_m-drinking-sluts) almost every night.

Wed, 09/28/2011 - 15:22 | 1719372 dick cheneys ghost
dick cheneys ghost's picture


Wed, 09/28/2011 - 15:27 | 1719395 moonstears
moonstears's picture

cheney's ghost is a funny guy!

Wed, 09/28/2011 - 15:40 | 1719436 TheLooza
TheLooza's picture


nice amateur example.

Wed, 09/28/2011 - 15:25 | 1719381 zoogle
zoogle's picture

Well done sir. Perhaps you've discovered another solution to add to a Keynesian's toolbox?

Wed, 09/28/2011 - 16:12 | 1719535 gaoptimize
gaoptimize's picture

You know what?  Denegrading some of the finest women in the world this way just isolates you from the REAL value they can offer.  I suppose you couldn't appreciate the awesome children they make and what good mothers they are.  Sure they are wonderful lovers, but I sense you are using "slut" in a negative way.  Your loss.

Wed, 09/28/2011 - 16:34 | 1719599 SilverRhino
SilverRhino's picture

Just be ready with the Louis Vuitton purses, rolex watches, Mercedes and other assorted bullshit if you choose to breed with them.   Ex-Soviets are expensive long term.


Wed, 09/28/2011 - 16:43 | 1719642 gaoptimize
gaoptimize's picture

Not mine.

Wed, 09/28/2011 - 17:01 | 1719735 TheLooza
TheLooza's picture

i was using CDS in the most honorific way and do not wish to offend. 

Wed, 09/28/2011 - 17:29 | 1719851 SilverRhino
SilverRhino's picture

togda horosho dlye tebya tovarische

Wed, 09/28/2011 - 15:22 | 1719368 Jack Burton
Jack Burton's picture

Hard as this may be for many to accept it is likely Ukraine and Belarus will remain basket cases until there is a reunification with Mother Russia. Of course many will be against this, but many are also for it. A union with Russia would likely allow for considerable self rule, but an economic union and fiscal union would allow for a united economic unit with the various parts adding to the whole.

Whether this happens is anyones guess, it may take total economic collapse in Ukraine and Belarus before public support for union grows. But the force of history points toward this result. Painful as that may be for some to take.

Wed, 09/28/2011 - 15:22 | 1719370 carbonmutant
carbonmutant's picture

They were certainly eager to join the EU... considering Greece's success in extracting €Billions in welfare I can see why.

Wed, 09/28/2011 - 15:23 | 1719371 Cheesy Bastard
Cheesy Bastard's picture

Oh oh domino.

Wed, 09/28/2011 - 15:28 | 1719398 Tsar Pointless
Tsar Pointless's picture

Thank you, Van Morrison!

Wed, 09/28/2011 - 15:27 | 1719373 JW n FL
JW n FL's picture



but what about all of those gas pipeline dollars?

I didnt think that the underwater pipeline was operational yet (from Russia to Germany Direct).

Russia completes Euro gas pipeline

GLOBAL PULSE: Russia & Ukraine - Pipeline Politics (1/29/2009)

New Pipeline To Europe Ends Ukraine's Blackmail And Thievery Of Russian Gas

Wed, 09/28/2011 - 15:25 | 1719383 rambler6421
rambler6421's picture

Hyperinflation bitchez!

Wed, 09/28/2011 - 15:34 | 1719384 Volaille de Bresse
Volaille de Bresse's picture

And these poor Ukrainian suckers were promised a UE membership, a NATO protection, and I don't know what else provided they could kick the Russians out of their country and out of their naval bases.


All the countries bordering the Black Sea (remember Georgia?) were promised the same lies by the neo-cons and their Brussels puppets btw. The key plan was to ban the Russians from this area permanently. 


"Checkmate, you Western losers" I hear Putin scream... LOL! He'll gladly help his Ukrainian brothers and turn them into his minions for the next 50 years. You can't refuse anything to a guy who saves you from bankruptcy. 

Saakachvili is next : he should already pack his things and ask W-43 to make some room for him on his Texas ranch (a dog house will be enough for "Saak")

Wed, 09/28/2011 - 15:25 | 1719385 Belarus
Belarus's picture

It's always nice to see my name in the news. 

Wed, 09/28/2011 - 15:26 | 1719389 RobotTrader
RobotTrader's picture

All these third world countries must be dumping their commodity stockpiles and gold reserves to raise cash.

Wed, 09/28/2011 - 15:33 | 1719411 Two Towers AU AG
Two Towers AU AG's picture

RoboTrader... are you for real!!!!!!.. if yes, you will probably be a nice speciman of a peanut brain..

Wed, 09/28/2011 - 16:20 | 1719556 disabledvet
disabledvet's picture

He's a robot still on the clock. It's all good once he hits the barstool.

Wed, 09/28/2011 - 18:01 | 1719964 mjk0259
mjk0259's picture

More likely the ruling class  are just moving them from the government warehouse to their own warehouse or just transferring ownership of the government warehouse with its contents to themselves

Wed, 09/28/2011 - 15:49 | 1719399 Smithovsky
Smithovsky's picture

forget the gold standard..

in Ukraine and Belarus, even gold stores its wealth in the 'russian standard'

Wed, 09/28/2011 - 15:31 | 1719407 Dick Darlington
Dick Darlington's picture

Spain does what the greeks have done, using "market conditions" as a camouflage. 

09-28 15:20: Spanish government suspends state lottery IPO due to market conditions
Wed, 09/28/2011 - 15:31 | 1719408 Belarus
Belarus's picture

Totally off-topic but I thought this was wonderful reporting:

Wed, 09/28/2011 - 15:48 | 1719426 Smithovsky
Smithovsky's picture

he thinks Blankfein and Lloyd are two different people (@1min29s)

the reporting is definitely full of something but it ain't wonder ;)

Wed, 09/28/2011 - 15:39 | 1719433 monopoly
monopoly's picture

That was great Belarus. lol

Wed, 09/28/2011 - 15:32 | 1719410 mynhair
Wed, 09/28/2011 - 15:33 | 1719412 NumberNone
NumberNone's picture

Fun with intials...Belarus, Ireland, Greece...France United Kingdom...Ukraine, Portugal...B.I.G.  F.U.K.  U.P.

Wed, 09/28/2011 - 15:36 | 1719420 Belarus
Belarus's picture

Ah....jeesh, and you had to get personal. : - )

Wed, 09/28/2011 - 15:39 | 1719417 NERVEAGENTVX

The sovereign basket will never overflow. There is plenty of room in the insolvency singularity.

Wed, 09/28/2011 - 15:35 | 1719418 monopoly
monopoly's picture

And they all rush to the dollar. Beyond words.

Wed, 09/28/2011 - 15:39 | 1719434 SheepDog-One
SheepDog-One's picture

Rising dollar, real bad news for the FED.

Wed, 09/28/2011 - 15:35 | 1719421 Cone of Uncertainty
Cone of Uncertainty's picture

U-crane, is that like a bird or something?

Wed, 09/28/2011 - 15:39 | 1719430 Smithovsky
Smithovsky's picture

not U-crane, PUKE-rain

Wed, 09/28/2011 - 15:37 | 1719427 mynhair
mynhair's picture

The ESFS, or whatever it is, will handle it.....not.

Wed, 09/28/2011 - 15:41 | 1719440 SheepDog-One
SheepDog-One's picture

Surely Germany will be happy to back all this bad debt getting worse daily....not.

Wed, 09/28/2011 - 15:51 | 1719479 NumberNone
NumberNone's picture

I'm sure in the back of the Fannie & Freddie vaults there are some tasty MBS's that we can split among everyone to use as collateral...

Wed, 09/28/2011 - 15:52 | 1719429 treemagnet
treemagnet's picture

They can't go bankrupt - they're the only place on the planet that still manufactures vacuum tubes!

Wed, 09/28/2011 - 16:30 | 1719586 Tedster
Tedster's picture

Eh, not quite - China does, as does Yugoslavia iirc.

Problem is most of the new-production stuff is junk, no matter what anyone tells you. The east Germans made a fairly decent EL34, even those are getting kind of pricey.

Anything that takes 5AR4 for example, deserves the "real deal", a Sylvania or Mullard. The Chinese repros WILL short out, and sooner rather than later. 12AX7 can be spendy too, though not if you know where to look, and besides they last practically forever.

Wed, 09/28/2011 - 16:45 | 1719652 lolmao500
lolmao500's picture

Which Nasa needs.

Also computers that controls the nuclear weapons.


Wed, 09/28/2011 - 15:40 | 1719431 mynhair
mynhair's picture

Move it TZA!  Only have 2 daze left for your sorry ass self to hit 57!

+/- a couple of weeks....

Wed, 09/28/2011 - 23:38 | 1720777 Nobody For President
Nobody For President's picture

I'm gettin' whiplash from that son of a bitch!

But today I'm in love with it again...

Come on sweety, just two more days.

Wed, 09/28/2011 - 15:39 | 1719435 NERVEAGENTVX

Fixed it for you!

Wed, 09/28/2011 - 15:47 | 1719464 mynhair
mynhair's picture

I'm dizzy.....

Wed, 09/28/2011 - 15:41 | 1719446 mynhair
mynhair's picture

Damn, these new European toilets really flush well!

Wed, 09/28/2011 - 15:42 | 1719450 HarrisonBergeron
HarrisonBergeron's picture

Global Chernobyl,:(

Wed, 09/28/2011 - 15:43 | 1719451 monopoly
monopoly's picture

Margin calls galore. They are trashing everything except AAPL AMZN.

Wed, 09/28/2011 - 16:00 | 1719500 gjp
gjp's picture

The human race will be saved from its financial folly (and overpopulation too) by tablet computers and smart phones!

Wed, 09/28/2011 - 23:40 | 1720781 Nobody For President
Nobody For President's picture

The half of the human race that uses this stuff, or the half (approx) that has never heard a dial tone?

Wed, 09/28/2011 - 15:43 | 1719452 RobotTrader
RobotTrader's picture

Somebody big is about to fail

Wed, 09/28/2011 - 16:01 | 1719505 Incubus
Incubus's picture

who cares.


Shit has failed a long time ago: people just won't accept that fact that it has failed.

This, my friend, is economic necrophilia.  You can keep lovin' it, man, but it's not gonna make it come back to life.

Wed, 09/28/2011 - 15:44 | 1719458 mynhair
mynhair's picture

Looks like the long bond is no longer safe.

Wed, 09/28/2011 - 15:46 | 1719461 monopoly
monopoly's picture

Yeah, something is going on that we do not know about.

Wed, 09/28/2011 - 15:48 | 1719467 ivars
ivars's picture

My recent quite succesful research that lead to successful prediction of Silver (in March 13) and Gold (in May 6th) spot price movements over last 6 months in these silver and gold price charts:

Silver prices 2011-2013

Gold prices 2011-2013

and further analysis has lead to a conclusion-explained here:


an interesting hypothesis emerges that , starting from q2 2012, in H2 2012 commodity prices in USD will rapidly converge towards a certain Bancor equilibrium for the first time, and than fluctuate around it in future, where:

1) the price of paper USD will be de facto determined by amount of a commodity it can buy in this equilibrium rather then the commodities price is as to today will be determined by the value of a certain currency set by exchange rates;

2) In fact, it will be the basket of all commodities that will serve as the ultimate reference medium of exchange for all paper currencies, and will de facto replace thus USD as world reserve currency;

3) the USD price ratios between different commodities will change so that to reflect the monetary ability (i.e. availability, longevity) of a given commodity to be the part of this world reserve currency, exchange medium for trade, not only its utility. Hence the price ratios IN USD between different commodities may differ quite radically ( as seen in example with gold/silver ratio and silver/copper price ratio) from what they are today;

4) if the logic of exchange medium effect on USD price ratio formation between commodities in USD can be discovered, the prices of commodities in USD can be quite accurately predicted after H2 2012, and ratios may not fluctuate as much as in USD as reserve currency time;

5) In such case, the prices in USD of other assets (land, houses, food, produce, etc) relative to commodities (and, of course, USD ) will also move from their current ratios to represent their potential as exchange medium for trade.

The signal for such conscious or partly conscious move to de facto Bancor system of international reserve currency will be triggered by official data of recession in q1 2012 in the USA (predicted here:DJIA 2011-2012 and the recession in the USA in q1 2012) and the resulting obvious unsustainability of USA debt ( it has already entered bubble precrash phase in 2000, as shown here: USA debt is forming a very soon precrash pattern) which will continue to grow superexponentially ( that is , in equivalent subsequent periods of time increases of debt value in USD will continue to grow) and imminent default (crash correction ) of the USA on its debt in near future.

Wed, 09/28/2011 - 15:48 | 1719469 mynhair
mynhair's picture

Think Rosie O'Donell just appeared before the EFBS, and they all puked.

Wed, 09/28/2011 - 15:50 | 1719473 mynhair
mynhair's picture

Ah, crud.  Just threw my back out.

I hate the Limbo.

Wed, 09/28/2011 - 15:50 | 1719476 walküre
walküre's picture

Germany will vote for the bailout / Markets gap up open +3%

Germany will not vote for the bailout / Markets open down -3%


It really is all about that stupid vote tomorrow. Could go either way.

Silver is cheap here. Paper silver could potentially explode to the upside tomorrow morning or we'll see it open at $25.

Any thoughts?

Wed, 09/28/2011 - 16:17 | 1719547 mynhair
mynhair's picture

Buy the rumor, sell the news.


Ooops, too late.

Wed, 09/28/2011 - 16:27 | 1719571 disabledvet
disabledvet's picture

Or not.

Wed, 09/28/2011 - 16:30 | 1719585 Saxxon
Saxxon's picture

Stay in cash.

Wed, 09/28/2011 - 16:42 | 1719638 walküre
walküre's picture

I didn't take the SLV position after all. Nothing gained, but nothing lost either.

Wed, 09/28/2011 - 15:53 | 1719483 SoNH80
SoNH80's picture

I just received this Telex....

Jagshemash, I am B. Zadigyev, I offer Kazakh Treasury Bonds at good price.  Please ZH persons of interest buy these Bonds for good invest.  Great success for such good biznes nyugdijukra good time.  Too bad about Ukraina but they are not so good bizesman.  Zenkuje.

Wed, 09/28/2011 - 15:54 | 1719485 monopoly
monopoly's picture

Hard to have a solid thought with such irrational markets that react to every rumor from every idiot.

Wed, 09/28/2011 - 16:06 | 1719517 mynhair
mynhair's picture

Hint:  The world is run by idiots.  Vote ODummest!

Wed, 09/28/2011 - 15:57 | 1719489 mynhair
mynhair's picture

Bargains galore!  Buy!

(Bounce, you fukker.)

- GS

Wed, 09/28/2011 - 15:57 | 1719490 Josh Randall
Josh Randall's picture

So is it PIIGS-U from now on or "U-PIIGS"!!

Where'd Liesman go to school to gain his Financial acumen from, "PIIG U "?

PIIG me ?? PIIG U !!!

Wed, 09/28/2011 - 15:57 | 1719492 Deadpool
Deadpool's picture

I hope advertising here on ZH (page left banner ad) pays their bills on time....

Wed, 09/28/2011 - 15:58 | 1719495 Caviar Emptor
Caviar Emptor's picture

PIIGS and East Euro countries entering into suicide pact

Wed, 09/28/2011 - 16:05 | 1719501 Deadpool
Deadpool's picture

GE made big push into Central Europe loans. that would be interesting....

Wed, 09/28/2011 - 16:02 | 1719508 mynhair
mynhair's picture

Quit pushing!

Wed, 09/28/2011 - 16:07 | 1719522 Josh Randall
Josh Randall's picture

LOL - exactly - should be a sign in front of the ECB = "You must be THIS tall to default technically in EuroLand"

One at a time please...

Wed, 09/28/2011 - 16:03 | 1719511 Bastiat009
Bastiat009's picture

All those debt and currency issues are really bad for gold. It doesn't make any sense but it's reality, for now.

Wed, 09/28/2011 - 16:05 | 1719515 mynhair
mynhair's picture

I'll take AGQ for 80, Alex!  Just let me back up the truck first.

Wed, 09/28/2011 - 23:46 | 1720789 Nobody For President
Nobody For President's picture

Right! It's only down to 99 and a cool down 17.83 per cent today; but tomorrow is another day...

Wed, 09/28/2011 - 16:18 | 1719548 Caviar Emptor
Caviar Emptor's picture

When the dust settles, gold and silver will be the only 'currency' left with ANY credibility. 

That's the take-home. Just look at all the catastrophes happening with fiat currencies -->that we know about <---. There are going to be many more dirty debt secrets and skeletons in the fiscal closet about to be revealed around the globe. 

Don't sweat the small stuff: if you own physical consider yourself blessed with one of the only solid things left that will retain it's buying power. Buying power is the key, essential way to look at it. THere will always be a premium going forward for anything that retains that power. The one with the gold makes the rules

Wed, 09/28/2011 - 16:33 | 1719596 disabledvet
disabledvet's picture

U forgot aircraft carrier battle groups and armored divisions. Just ask "where's Waldo" kdaffy. I would actually find "find Kdaffy" as a tv show highly entertaining if completely the wrong way.

Wed, 09/28/2011 - 16:24 | 1719555 mynhair
mynhair's picture

Maybe some day the Silver Bears will do a song:\

"Waiting for the Next ZH Article".

Wed, 09/28/2011 - 16:28 | 1719575 Caviar Emptor
Caviar Emptor's picture

As it turns out, there isn't one large economy left solvent in the world. It was the era of shop till you drop, greed is good and buy,buy,buy. 

Well, now what's coming is the era of the grasshopper and the ant. Some who saved and avoided debt and disbelieved all the get-rich-quick hype will be doing ok. 

Wed, 09/28/2011 - 16:45 | 1719657 walküre
walküre's picture

Saved what? Worthless paper with a promise to be paid by some government?

If you're correct, and I don't doubt you will be.. then the only save assets are oil wells, agri-land title, gold and silver. Period.

Maybe good art as well. Farmers will barter good art for potatoes.

Wed, 09/28/2011 - 16:28 | 1719580 SILVERGEDDON

They are all rushing to vodka for safe haven. If a Ukrainian falls in the forest after vodka, do they make a sound?

Wed, 09/28/2011 - 17:24 | 1719831 Zymurguy
Zymurguy's picture

Yes, it sounds like "Ufff, Da, Fuk"

Wed, 09/28/2011 - 16:38 | 1719613 Cult_of_Reason
Cult_of_Reason's picture

Re: "As of 17.00 on Sept. 28 debt is paid."

Actually the correct translation of "?????? ?? 17.00 28 ??????? ???? ?? ?????????. " is:

As of 17.00 on Sept. 28 debt is NOT paid.

There is "??" (not) between "????" (debt) and "?????????" (paid) that Google boneheads omitted in the translation.

Wed, 09/28/2011 - 16:54 | 1719706 PSEUDOLOGOI

can you post the link?  I can translate for you...

Wed, 09/28/2011 - 16:42 | 1719631 Catch-22
Catch-22's picture

3 mothers you don't mess with...

Wed, 09/28/2011 - 16:53 | 1719694 PSEUDOLOGOI

I've reached out to my friends and family in Ukraine to give them a heads up...

As you can imagine this news has not reached the main street in Ukraine, but some info is begining to surface up over there...

Question: When is the next coupon due? and in your professional opinion, how much time is there to prepare for Ukies?


Wed, 09/28/2011 - 16:58 | 1719724 Where My Dawg At
Where My Dawg At's picture

Maybe the Irish can come over and help...

Wed, 09/28/2011 - 18:35 | 1720077 Dick Gozinya
Dick Gozinya's picture

It's "Ukraine" (like "Russia"), not "The Ukraine". Nyet.



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