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And Now The Bundestag Demands A Say
It appears that any hope for a quick resolution (not like one was even available) over the weekend may have just been jettisoned. According to FAZ, the German parliament, which made it all too clear wants to be heard in all future European bailout instances courtesy of the constitutional court decision in early September, has just announced it wants to be heard, this time for real, and decide, on any EFSF expansion facility and specifically the usage of more leverage to fight already unbearable systemic leverage. To wit: "Before the meeting of Heads of State and Government of the Euro zone, which will decide on Sunday in Brussels on the guidelines ("Guidelines") of the euro rescue fund EFSF, the federal government is faced with demands from parliament. The fractions from the CDU and FDP want to discuss this Thursday in special session on the voting behavior of their representatives on the Budget Committee, according to the Law on the Participation of the Bundestag, Chancellor Angela Merkel (CDU) in Brussels to rely on an affirmative vote of the Committee." Unfortunately for Merkozy, their despotic and tyrranical measures according to which they represent the will of the people yet really all they do is preserve the viability of insolvent French banks, will no longer fly.
There is dissatisfaction in the FDP, the Bundestag will once again put under extreme time pressure. The chairman asked Brüderle Finance Minister Schäuble (CDU) to allow the deputies to the seventy-page draft guidelines to Thursday, 0.00 clock coming in German. "I will convene a group meeting only if texts are there," said Brüderle. If necessary, the budget committee until the next week will deal with the guidelines, the chancellor could agree with them then only with reservations. The CDU leadership even a shift of the summit was discussed in order to allow proper parliamentary involvement. Mrs. Merkel had to travel if necessary without a mandate to Brussels, however, it was said in the Union Group.
In the fractions of union, SPD, FDP and the Greens is the introduction of a "lever" to increase the EFSF "firepower" hardly controversial. Schaeuble said on Tuesday in the Union Group ". A lever is per se not indecent" Bruederle said: "Each bank levers." It was assured by all sides, the German "under warranty" in the EFSF stick to the approved by the Bundestag 211 billion euros. Of course it also meant by a "lever" There was a growing risk that the funds are actually paid.
As for the dud-ness of any plan to come this weekend, that should not be a surprise to anyone:
In Brussels insiders also warned against unrealistic expectations about the future "firepower" of the EFSF. Invoices, which could be the entire volume of funds of 780 billion euros, or at least the proposed loan amount of 440 billion euros, "leveraged" are illusory. Such bills had triggered speculation on Wednesday, the fund could cover a financing volume of up to three billion euros. This expectation was completely over the top, said an EU official.
A leverage factor of five but is considered completely unrealistic. It can only be leveraged that sum, which is not already scheduled for loans. The awards already EFSF loans to Ireland and Portugal and is also the principal financier of the second aid package for Greece, the amount to be determined. With these aids are at least € 100 billion already committed. You may also need the EFSF soon € states grant credit to recapitalize their banks. Not be estimated because of the volume of loans fall, is difficult to estimate what portion of the EFSF volume is "capable of lifting treatment."
Thank you Germany for being once again smarter than everyone else, and daring to actually realize just how unfeasible 5x leverage on the sub €300 billion in usable EFSF really is.
In conclusion...
Penetrates the SPD for the case of increase of the German liability risk that not only the budget committee, but also the plenary of the Bundestag must approve such a step. "Should the leverage in the EFSF significantly increase the risk of loss, then the total budgetary responsibility of the Bundestag touched," said the parliamentary secretary Oppermann. It was an "intolerable situation" that the deputies - were not submitted until Thursday, the guidelines in German translation, and then probably should look into the night on Friday the Budget Committee so - possibly. It had "features of a secret policy."
Oppermann noted ironically that the deputies should still wait to see what the Chancellor in her statement on Friday conceal before the EU summit in Brussels in the Bundestag. He accused Schäuble, have "deceived" in passing the Act, the EFSF MPs about the level of risk to German. Oppermann indicated that the Bundestag on the Friday, if necessary, but should vote until next week, even if the Chancellor could then agree on the weekend in Brussels, an EU decision only with reservations.
The CDU / CSU parliamentary group Kauder chairman made it clear on Wednesday that the group would be with the "Guidelines" deal only if the deputies had been at least four hours to the study of the text. Otherwise, the special session would be to move the group on Friday. The Union Group stated that the European partners would have to get used to the participation rights of the Bundestag. It could not be serviced until the eve of an EU summit, to which are to be voted on finished texts.
The parliamentary secretary of the Green Party, Beck said. "We want to examine the bill to leverage the EFSF benevolent" He demanded, however, that will be voted on in plenary of the Bundestag. The sum at issue speak for it. That would ensure a majority in Parliament about, did not doubt the Green Party - but whether the coalition would bring back its own majority. Schäuble had with his earlier assurances, a leverage am at now, and if, then the Parliament will have to decide, "lulled" their own ranks. Maybe that will take revenge now, Beck said.
... Kiss any prompt multi-trillion, quadrillion, or other ridiculous amount resolution good bye. Just as we predicted back in July, the Germans have had it with tyrants.
h/t Brigitte
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Game Over!
Examine all you want, there is nothing there. Meanwhile take a lookat Athens where there is no rest when it comes to hurling Molotovs. A peak into the future will surely sober you up a bit if you much to lose and little to gain like the Germans.
Let's hope so.
sarkozy walks
Germany will exit by New Years.
Helmut Kohl promised Germans that they would never pay to bail out other countries. And now Germans are expected to backstop all of Europe, especially if France loses AAA by 2013.
Germany will look @ the long run costs to its economy, and leave.
Mitterand accelerated unification before European countries were able to adjust their economies for a common currency. So they faked the data (Greece), and broke the deficit rules (Ireland, Portugal).
The structural problems were due to Mitterand's political ambitions, and ignored economic conditions.
In the long run politics and policy must converge with economic reality.
Nein. Nein. Neing Euro.
enter DeutscheMark.
"Thank you Germany for being once again smarter than everyone else"
as a german i must disagree. our politicians are just as stooooopid as there were 60 years ago and do not look further than to the next elections.
Frankly: like the EURO the EFSF has been introduced by France to get bailed out by Germany.
France will go down by the end of the year. Germany must exit all that mess, otherwise it will be ruled by an angy-german-party again. you can count on that.
If your pols are only as stupid as they were 60 years ago - yup, they're the smartest in the Euro -- the other ones have gone downhill the entire time.
smart? are you smart when you decide to move into a house and share your bank account together with unemployed punks when you are a millionaire with a PhD?
not really smart in my view and in the view of many people e.g. from switzerland.
There isn't just smart and stupid. There isn't just integer and corrupt.
The entire 1st world's culture, politics, economics and so on has been in a constant process of dumbification and corruption since decades..... and the "leader" of the pack has been the US, with the others following them.
The thing however is, that there has been a lag in following up. Most other countries and especially europe, have been implementing things, the US did ten or twenty years ago.
In germany and most other european countries, even though politicians have become ever more corrupt, the safeguards in place have not been neutralized at the same pace. Thus, you structurally still have signs of "a better past" everywhere.... from institutions, gov-structure, constitutions, the law, party politics and party diversity (almost every european country has small minor parties which rejected both the EMU and the bailouts). Plus, europeans are less apathetic regarding social unrest, than the US (even though, again they have become more ignorant - just at a slow pace than "the plan" would demand).
So, even though politicians and banksters way wish to rape europe at breakneck speed, they constantly stumble over obstacles, becaues the terrain of the war still to some extend is made for a different kind of politics and policies. For example, doesn't matter if we're talking bailouts or social austerity measures.... they face a seemingly endless bombardment of legal action.... the courts are constantly declaring things illegal, which were signed into law years ago. Even though in the MSM it may all look peaceful and conformist, behind the scenes there is an open legal war going on.
Sure, you may now say "they'll get rid of them too - they're in the way!"... oh, sure, they may do, but that will take time, because the rules how to change existing structure also are full of red tape.... meanwhile, the EMU is imploding right now.
German leaders, as their US and EU conterparts, do not give a shit about Germany or its people.
So, this tragy-comedy play will continue until a house of cards falls down.
Germans, as the rest of EU, will face the reality instead of buying empty promises.
socialists, communists, Marxists and capitalists in a fight to the death. we live in interesting times, no?
so who is the enemy in this circle jerk?
Anyone/Everyone with an eye on your wallet, stuff, or freedoms.
well they say
Bob Barker. God, I hate that guy.
Correct except the capitalist part. What we are witnessing is the death of socialism. The welfare state has expired and what we are watching now is socialism's deaththorws. Or to put it another way, Indignados doing the frog march onto the trash heap of history :)
The worst part is that in another few generations everyone will forget all the lessons and all the history and repeat it all over again. Except this time there might not be much left.
Love my EURUSD spot short! This just may get really ugly really fast!
get ready to hit that buy button....... 8 minutes to launch and counting.
How dare these democratically elected representatives stand in the way of all the "progess" that was about to be made! Time for the Fourth Reich, eh Madam Fuhrer?
they couldn't organize a rotary club much less a Reich....we're watching the Euro experiment disolve on live t.v.
In all fairness, Rotary Clubs can be quite demanding.
The Rotary 4-way test:
Is it the truth?
Is it fair to all concerned?
Will it build goodwill and better friendships?
Will it be beneficial to all conerned?
... certainly Merkozy couldn't organize a Rotary club.
Didn't too badly with the Reich either. If not for Mussolini's misadventure into Greece, and the Feuher having to come and bail them out, causing the delay to Operation Barbarosa, we would have had a currency/debt/transfer union going on 73 years ;)
not sure why the Germans have allowed this b.s to get so out of control.
nobody worthwhile (i.e. citizens and businesses who exercised prudence) is benefitting from this slow road to hell.
shit or get off the pot already.
Germany stands to see all of its debt wiped out along with the EURO. The decline is controlled to such an end and can continue for considerably longer than anyone on this site can remain solvent.
that is BS and only one side of the story: the same time all of the german savings and life insurances including target2 credit of 450 billion eur is gone as well.
Not if the Mark comes back with strong buying power. At this point losing LESS purchasing power, is winning.
The system is not set up to reward responsible behavior. How else can any reasonable economics professional explain why a company betting against itself would be profitable. Fixing all this requires a reset, I see no other way. Unfortunately everyone is afraid of what a reset means so we get what we get. So for now, we get this slow dishonest decline because everyone is letting fear make decisions for them. Total bullshit, yes, but nothing unexpected when one considers human history.
Some politicians are smart/helplessly corrupt and demand extra bonuses for their hard work on voting FOR the EFSF at the last moment. This enhances their bonus.
Actually, the Germans are the biggest beneficiaries of the Euro. 75% of their export is within the EU. And they have a currency that is effectively 50% cheaper than their fellow Eurolanders. This is how the "sick" man of Europe became the king of the hill in the course of 4 to 5 years:)
this is stupid. germany was the wold exporter no. 1 during deutschemark times.
sick man of europe? for sure you have not seen any other european countries.
That's bullshit
Mercantilist nonsense
caution! these globalist bastards create a crises, then bring in a solution that only benefits them! hitler was funded by these bastards!
yup:wailing and gnashing going on in brussells - how can these provincials be allowed to mess with the master plan. Big threats to what is left of democracy in Europe loom.
you've heard the old phrase,... 'it's different this time' - well, perhaps it really is?
germany, france, uk, and all of europe, might coalesce around one leader, united too purge the oligarch, fighting only the bond ghoul army,... those baby- blue helmets from basel?
damn i wish our CONgreff was like that!
"wish"
The new Fuehrer and Laval
OK, I'm gonna spoil the ending here...
And all the King's horses and all the King's men couldn't put Athens together again.
goddamnit, now I'm just gonna wait for the Euro collapse to come out on DVD.
You've got a fine avatar there. Is your moniker the name of one of the dudes at Mos Eisley spaceport?
digitized just like all currencies
Well they have a point.
If they have already used a good portion of the EFSF and more must be used shortly what is there left to leverage.
They are going to have to go for broke ...... a full debt and fiscal union.
They can only do this out of a crisis.
If there is no crisis the various EU Parliaments will not go along and those countries that have referenda would reject it.
Why. Why do they HAVE to go for broke and embract a debt and a fiscal union? I maintain that, politically, the European experiment is dying and may even be dead.
You mention a crisis, but who is to say the solution to a crisis is automatically more union. Perhaps the solution will be view as no union. Or a two-tiered union.
Just because people are afraid to look beyond the 'unthinkable' does not mean that it really is.
I am not proposing nor supporting a debt & fiscal union.
But there are those in Europe who desperately want it.
If they don't get a leveraged EFSF they know that the "Great Project" is over.
Desperate people do desperate things.
Not saying it would work.
“Events can move from the impossible to the inevitable without ever stopping at the probable.” - Alexis de Tocqueville
Too late for that me Lord. The game is up. All that is left is to pick up the pieces. No debt/transfer union can save them now. All that they can do now is break up, return back to their national currencies and devalue ;) The longer they keep this stupidity up, the worse mess they will have to dig themselves out of. And you can take that to the bank. Oh, I almost forgot, socialism es muerte :)
You could be right.
Going to get ugly either way I fear.
"...their despotic and tyrannical measures according to which they represent the will of the people yet really all they do is preserve the viability of insolvent French banks, will no longer fly." Soooo...where's the tabloid rumor to get the Euro flying now?
and why during all this song and dance hasn't Russia rolled into Georgia and China into Tibet? stay tuned.
They wait for the US to attack Iran...
Yes, and I will simply add that CHina and Russia are on the same page with the U.S, albeit for different reasons.
... or Pakistan, the crypto-rogue state with nukes.
Game over will be when game is over... till then we will be swinging.
Yes, we will be swinging, but it will be like the Bugs Bunny cartoon.
"One...two...three strikes - yer out!"
"One...two...three strikes - yer out!"
"One...two...three strikes - yer out!"
When will this all blow up so we can start over again. That will happen. This is madness.
Last hour just may get really ugly. Notice how the funds and heggies are really trying to keep AAPL above 400.
Schaeuble (CDU) told the parliament just before the voting of the ESFS, that the current legislation does not allow leveraging. He also promised the coalition partner (FDP) that ESFS will not be leveraged. A breakup of the German government is not out of question.
schäuble is a drug addicted cripple who does not care about all what he said before.
damned medication - gotta understand.
FIRE IN THE HOLE!!!!
Vielen dank Brigette. Then the German people have finally opened their eyes and have had it with despotic Brussels and euro "elite" rule?
Tschüß !
Bis später!
Ja, danke Brigitte!!
I don't see any EFSF opposition in the parliament, it's just an insignificant and formalistic mock fight
Deflation Bitchez?
Market tanking...................Rumor/printing mill fires up in 4.......3......2......
This market is due for some sturm und drang.
btw, is that a Babelfish translation?
Even if they voted in favor for it dont they need it to be voted on by the people and make a change in the Constitution
Europe, repeat after me: "There is not, and there will never be, enough money to fix this problem."
There, doesn't it feel better to finally just admit it?
tyler, you understand google translate?
Oh, but 3pm is rolling around... time for a big pump to the end!
Howling!!!
OT - Paul Krugman wrote in his blog about the rise and greatness of "econoblogs", and talking about how they are great in pointing out faults and contradictions that an economist might say or write.
He however, makes no real mention over his retarded calls over the years, but does write, "So yes, we’ve seen some famous names run into firestorms of criticism — *justified* criticism – even as some “nobodies” become players. That’s a good thing! Famous economists have been saying foolish things forever; now they get called on it. " Also there's no real mention of any blog or Zero Hedge in the article..
http://krugman.blogs.nytimes.com/2011/10/18/our-blogs-ourselves/#more-25365
yep,... just get a 'good housekeeping' seal of approval from the "nobel's e'con", and your good to go at the 'wp'/'nyt',... but ironically you gotta have a prerequisite pass - ya-know, being in the boys club, aka, 'princeton/ harvard/ yale' [the thought police of group think, where all originality bounces through a vacuum echo chamber into a hot wind tunnel recycling the outed closet dwellers of double speak made easy].
Does this impact last week's resolution by China to bail out Greece?
where does the pirate party stand?
they are prob ready to blow the fuking Blunderstag away w/ cannon, BiCheZ!
In the latest opinion poll, they reached an all-time record of 10% with a rising tendency.
Die already E.U.S.S.R.! And take all your Federasts and bureaucrooks to hell with you.
Federast is my new favoriter word.
I wish I had fathered it, but it comes from a quip by Jean Marie Le Pen.
Will Japan still honor its longterm commitment to bail out Greece?
Yes, right after Greece bails them out.
Over a year old but still applicable:
http://www.youtube.com/watch?v=I5QwKEwo4Bc
Sure. But in this context "longterm" means two months.
it's looking like the EU may just win the race to the bottom after all.
the first large scale victim to fall before the plague of the 21st century...debt
of course,we here in the States won't be far behind so I don't suppose it really matters who goes first does it?
Who says Washington has a patent on dysfunction.
I hate to say it but I think there are at least a few more cycles of headline driven volatility in the future. I think the politicians are buying time for their clients to get out and leave those not as well connected holding the bag. Look at what BofA did moving their derivative risk over to their banking arm so their depositors and the FDIC can hold the bag when this finally blows up. I think you will see others doing the same thing. When they are all in the lifeboats then they will scuttle the EU and maybe the world financial system.
Then why move the money at all? You think it will give them some kind of justification or protection or evidence in the future.
This reminds me of the scene in Braveheart where the Scotts are trying to declare their claims on throne and territory; fighting over the terms of their inslavement; fighting over power.
The politicians don't get it they think the system is going to keep sailing along and want to keep their fairytale going. They will make promises even as there are torches and pitchforks at their doors.
now, the record clearly shows that they were for it before they were against it
then, they realized they didn't know what the definiton of "it" is
then, they realized they didn't know what definition of "they" is
then,... GrrrRRhhrrRRHHH!!!
When pondering stuff last night in bed...
I had a sudden realization of a potential path Germany may take. Let me tell you this idea I had. It's nutty but stranger stuff has happened.
Germany leaves the Euro. Reinstates the old German mark as the offical fiat of Germany.
Here's the kicker... Germany keeps on paying their bonds and so on in now devalued Euros. That way Germany pays off it's debt faster!
And to make things worse, Germany shall print marks so to keep the mark from being overly strong. Uses the freshly printed marks to pay down further the debt or invest in programs. Despite the printing, the German Mark remains strong versus other fiat.
This way, Germany gets richer and gets the last laugh.
Feel free to tear into this nutty idea I had. Please tell me how this scenario is not possible...
Yes. I think we are at a point where there is a branching of the ways.
Their reissueing the Mark is certainly a possiblity. --- Someone recently examined the fate of monitary unions and found that most often it was the rich countries that left them.
There comes a point where there will be political recognition, that the only viable solution is to kick the defaulters out of the monitary union.
You will know that that point has been reached, when dissent breaks out among those in power in Germany. Not just a few voices but the Bundestag making demands. Then, those who had followed the Globalist/Fascist agenda, because they liked the political benefits, will realize that the time has arrived when they must pay the costs.
I believe we are now close to that point.
I suspect that not long hence, some or all of the PIIGS will resume printing their own currencies, again; they will devalue until their economies stabilize; banks will take losses, be bankrupted, broken-up, or bailed-out; and the European economy and the Euro (if it still exists) will recover.
Perhaps, the S&P will touch 1100 again. Or perhaps it won't. And there will probably be some vibration, as these events transpire. Nevertheless, you will notice that we are now close to the long-term trend-line that goes back to the 1930s. So, looking forward, it seems to me that the main issue for the powers that be, now, has become, how to damp out reactions and fears and replace them with slow steady sustainable growth. That is what they have been saying, for some time, now, and that is where we appear to be, today.
At any rate, that is my perspective on these issues.