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The Beginning Of The European Endgame

Tyler Durden's picture




 

From Peter Tchir of TF Market Advisors

ECB Bond-Buying Should End With New EFSF, German Motion Says

I think this is one of the most important bits of news on the day. This and the fact that the Dutch finally said something - and it wasn't positive.

I have been arguing that the solutions create contagion rather than prevent it.  I've also argued that the ECB and EFSF and to some extent the IMF are all the same pools of money.

Now that Europe has actually tried to do some calculations, which it is apparent that up until last week, they hadn't done, they are coming to the same conclusion.

On Friday the "haircuts" on Greece get serious. No more bogus high coupon principal protected notes - but real notional reductions of 50 per cent or more.

I believe the ECB has a portfolio of 55 billion of Greek debt. If average price was 80 then that is a 16.5 billion actual loss.

ECB, unlike our beloved FED, doesn't want to just print money so they make a capital call on their members. Yes, the same members that back the EFSF.

How many of those members even remembered the ECB can call for additional capital (it's why they are so happy to employ the double down don't frown trading strategy).

The terms of ECB capital calls are worse than EFSF because they are joint and several. If countries don't meet their obligations they don't go away, they get passed to another country.

So as ECB loads up on PIIGS debt and losses or haircuts would be paid for by the non problem countries - in addition to their EFSF obligations.

Germany maybe has learned not to overextend and is scared to pile this (previously ignored) liability on top of it's EFSF guarantees. At least EFSF is something they have control over.

France I think was planning on loading up the ECB with so much debt they would just capitulate and print money.

Other people have more knowledge of the ECB but the ECB has things in common with the FED but also has similarities to the EFSF.  I think this is an important turning point for the politicians in Germany and other prudent countries and they are trying to limit how much they can lose in this last ditch attempt to avoid making countries and banks and investors pay for their mistakes.

 

From Bloomberg:

ECB’s Need for Bond-Buying Should End With New EFSF, Bundestag Motion Says

German lawmakers are set to vote on a non-binding call for the European Central Bank to end its secondary-market bond-buying program once the enhanced European rescue fund is enacted,

The joint motion, agreed on by the government parties and the main opposition in Berlin today, sets out terms for the lower house, the Bundestag, supporting the European Financial Stability Facility in a vote tomorrow. It “notes that the need” for the ECB to continue its secondary-market program ends with the new fund’s enactment and urges Chancellor Angela Merkel’s government to “respect” the ban on central-bank credits as well as primary-market purchases by the ECB as the EFSF is set in stone.

“For us it was a condition that the Bundestag, respecting the central bank’s independence, has a clear position: no more unconditional debt-buying by the ECB,” Carsten Schneider, the opposition Social Democratic Party’s budget spokesman in parliament, told reporters after a budget committee meeting.

The motion sets criteria to which Merkel must adhere when she goes to Brussels after the EFSF vote tomorrow for a second European summit in four days. The budget committee or the full chamber must be allowed to vote once more after leverage models have been transformed into guidelines for the fund, according to the text. It also stipulates that systemically important banks re-capitalize by June 30, 2012.

‘Non-Standard Methods’

Merkel said earlier today that Germany opposed the inclusion of a reference to the ECB continuing its bond-buying program in a draft text prepared for tomorrow’s summit. While officials are still working on the text, “the wording doesn’t state that there should be more secondary-market purchases, but rather that the non-standard methods of the European Central Bank could be pursued further,” she said.

The motion, drafted by ruling coalition lawmakers and distributed to reporters by Merkel’s Christian Democratic Union, aims to attract the broadest possible support from the opposition Social Democrats and Greens in tomorrow’s vote by seeking to curtail the potential demands on German taxpayers of the enhanced fund.

These include ensuring strict adherence to the EFSF’s guarantee framework, with a cap on German guarantees at the existing level of 211 billion euros ($293 billion), and ruling out “optimizations” of the EFSF that can alter its framework treaty.

 

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Tue, 10/25/2011 - 20:52 | 1810586 westboundnup
westboundnup's picture

It's over Johnny . . . IT'S OVER!

Tue, 10/25/2011 - 20:55 | 1810593 Ahmeexnal
Ahmeexnal's picture

Netherlands told Merkel "fuck off beyotch" and is going back to the Gulden.

About effin time.

Tue, 10/25/2011 - 21:42 | 1810767 philipat
philipat's picture

But the attached Organisation chart shows the real situation in Europe:

http://yfrog.com/z/hs882hdj

Tue, 10/25/2011 - 21:46 | 1810783 Chuck Walla
Chuck Walla's picture

Now that chart is truly funny and truly true.

Tue, 10/25/2011 - 23:32 | 1811159 CompassionateFascist
CompassionateFascist's picture

So the weather's cold. Snow, ice, whatever. So what?

Wed, 10/26/2011 - 04:41 | 1811437 djudy003
djudy003's picture

I think that's bird shit not snow.

Wed, 10/26/2011 - 06:16 | 1811474 Bicycle Repairman
Bicycle Repairman's picture

LOL.

Wed, 10/26/2011 - 06:34 | 1811477 DutchDude
DutchDude's picture

whatwhut??? what did i miss?

Tue, 10/25/2011 - 21:31 | 1810718 PicassoInActions
PicassoInActions's picture

its not over till its over. we were thinking it was over in 2008... we are in 2011.

I am sure they will be another miracle devices like Ipad, FED, ECB, BOJ and so on.... Miracles just don't stop comming in...

Tue, 10/25/2011 - 21:47 | 1810788 philipat
philipat's picture

You mean Merkel is the Fat lady?

Wed, 10/26/2011 - 03:12 | 1811382 Ghordius
Ghordius's picture

wait until she sings!

----

I usually enjoy all Tchir posts - this one is not one of the best and I disagree.

The option of calling for capital of the ECB is only for cases where the ECB needs to "defend" a certain level of the EUR. Since we are all in the "down" leg of the currency wars, there is no need at all - although there might be a future (leg "up") where govs will be busy screaming at the CBs to "do something" to keep the currency up.

CB "losses" of 16.5 or even 50 bn? Peanuts. The puny little SNB can have more without breaking pace - for example last year because of the book value of the EUR and USD holdings they had (from memory) some 22bn.

It's like you know there might be a war next to your village and your wife complains you are buying ammo - it's a loss, she says. Yes, darling, it's a "loss". No darling, I will buy ammo.

Financial commentators have the bad habit of looking at Central Banks as if they were Banks - CB's can't go broke, they can only become - for lack of a better word - "impotent", i.e. without sufficient FX reserves at the right moment.

Wed, 10/26/2011 - 06:40 | 1811478 Withdrawn Sanction
Withdrawn Sanction's picture

CB's can't go broke, they can only become - for lack of a better word - "impotent", i.e. without sufficient FX reserves at the right moment.

Nonsense.  Of course they can go broke.  Insolvency is an inescapable condition, not a state of mind. When a CBs owings exceed the value of what it owns (by more than its capital), it's done. Such a zombie may continue to stalk the landscape, but it is financially dead w/o new capital. A clever change of terminology to "impotent" is just a fashionable way of trying to try to evade this fact.

Tue, 10/25/2011 - 23:02 | 1811067 mayhem_korner
mayhem_korner's picture

 

 

Au still rippin' in overnight hours.  Curious.  Maybe the sideways movement is taking time out, or maybe there's a little more safe haven leakage going down here.  We'll see...

Wed, 10/26/2011 - 01:54 | 1811304 FinHits
FinHits's picture

"The terms of ECB capital calls are worse than EFSF because they are joint and several. If countries don't meet their obligations they don't go away, they get passed to another country."

 

The obligations of the member national central banks may be joint and several, but the pass-through mechamism, if any, is to my knowledge not fixed at all. In theory it could be ECB Capital Key (but isn't even fixed to that), but how the money is contributed and in which order, if e.g. Greece and Ireland can't cough their share, is not defined by my knowledge. And won't be defined in a hurry.

So effectively, ECB capital call is toothless, and in fact ECB operates ring-fenced. It can easily take the losses and can not pass them on. Negative equity in balance sheet doesn't matter, or if it matters ECB can print money to make whole the minor shortfall of few billions. It is not like anybody cares what Bank of Japan balance sheet looks like as regards to equity.

I would like to see links here to ECB rules if there is disagremeenent on. This paper states there is no ECB loss/recapitalisation agreement in place:

http://www.cepr.org/pubs/PolicyInsights/PolicyInsight24.pdf

A key quote there:

"If it is to be the euro area national Treasuries that will provide fiscal back-up for the ECB, in what proportions

will they share the fiscal burden of recapitalising the ECB, should the need arise?  

There is one readily available key for distributing the fiscal burden of recapitalising the ECB if in the future

its balance sheet is impaired as a result of lender of last resort operations or market maker of last resort actions

vis-à-vis EU-banks.  This would be for each euro areaMember State national Treasury to pay a share of the

bail-out costs equal to the share of its NCB in the totalshare capital of the ECB, divided by the sum of the

shares of all euro area NCBs in the total share capital of the ECB.  Other formulae can be thought of, but it

would be wise to have something agreed before the first EU Bank incorporated under EU statute law pops up and goes belly-up"

Wed, 10/26/2011 - 06:46 | 1811487 Withdrawn Sanction
Withdrawn Sanction's picture

Negative equity in balance sheet doesn't matter, or if it matters ECB can print money to make whole the minor shortfall of few billions.

What you've just stated is equivalent to claiming the ECB has insufficient means to make good on its liabilities, the chief one of which is the euro.  I agree.  Whether they actually recognize this fact w/honest marks is an important but secondary consideration.  Financial gravity asserts its inexorable pull on all players, whether they choose to recognize it or not.   

Wed, 10/26/2011 - 05:30 | 1811453 TooBearish
TooBearish's picture

Take a seat, Pete, the ECB will never mark to market and therefore THERE WILL BE NO CAPITAL CALL - you shld know this - Dood

Wed, 10/26/2011 - 08:48 | 1811829 DebtSlaveZombie
DebtSlaveZombie's picture

Nothing is over. Nothing. You just don't turn it off. It wasnt my war. You asked me I didnt ask you.... :-)

Wed, 10/26/2011 - 10:20 | 1812245 RemiG2010
RemiG2010's picture

Nothing is over! Nothing! You just don't turn it off! Nothing is over until I say it is!

Tue, 10/25/2011 - 20:55 | 1810587 i-dog
i-dog's picture

*** BREAKING NEWS ***

We interrupt your regular programming [pun intended!] to bring you this important development in the fight against global central planning ... aka the NWO.

Alternative media coverage of the Vatican's call for global economic central planning has been pulled!!

On Monday, the world's oldest, largest and richest multinational corporation--the Vatican--released this globalist blockbuster: (links*: Reuters; Vatican Radio)

http://www.reuters.com/article/2011/10/24/idUS264245887020111024

http://www.radiovaticana.org/en1/Articolo.asp?c=532223

Vatican calls for global authority on economy, raps “idolatry of the market"

The Vatican called on Monday for the establishment of a “global public authority” and a “central world bank” torule over financial institutions that have become outdated and often ineffective in dealing fairly with crises.

The document from the Vatican’s Justice and Peace department should please the “Occupy Wall Street”demonstrators and similar movements around the world who have protested against the economic downturn.

Though this release was originally covered by HuffPost, Drudge and Infowars without comment (but not by ZH!?!), both Matt Drudge and "anti-globalist" Alex Jones have since pulled this important globalist story from their home pages!! ... And the HuffPost is no longer covering it on their home page either, or even under either Politics or Business, but has buried it under "Life & Style", sub-topic "Religion"!!!

http://www.huffingtonpost.com/2011/10/24/vatican-economic-reform-radical_n_1028061.html

It seems to me that some Cardinal in the Vatican prematurely let the cat out of the bag and that the word has gone out from the masters to catch it and bury it at the back of the garden as quickly as possible!

FFS!! Those [apparently very few] of us who are opposed to global central planning by the NWO are on our own now!!

We apologise for the interruption and return you to your 'divide & conquer' programming....

Oh ... and PS: ... SECEDE NOW!!

--------------
*Note: Even Vatican Radio's original release (article #531752) has been pulled and replaced by this revised one (article #532223). http://www.radiovaticana.org/en1/Articolo.asp?c=532223

Tue, 10/25/2011 - 20:57 | 1810599 Ahmeexnal
Ahmeexnal's picture

DULCINIANS OF THE WORLD, UNITE!!!!!!

Tue, 10/25/2011 - 21:50 | 1810800 Carlyle Groupie
Carlyle Groupie's picture

LoL. Yes, nice. Take the focus off the lizard people, the Pope is actually the head of AIPAC.

Tue, 10/25/2011 - 22:05 | 1810828 i-dog
i-dog's picture

http://lizards.com/2sgaw5ez6y-t.jpg

PS. You sure do live up to your tag! Cute. "First they ridicule you,...." (PsyOps 101)

Tue, 10/25/2011 - 22:49 | 1811011 False Capital
Tue, 10/25/2011 - 23:22 | 1811112 i-dog
i-dog's picture

Thanks, but I'd already read it yesterday. Can you also post a link to where he discusses it on air and expresses his "outrage" along with his other "anti-globalist" rants?

Tue, 10/25/2011 - 21:02 | 1810610 navy62802
navy62802's picture

The Vatican has one thing correct in their statement ... we do suffer greatly from idolatry of the market. As for their "global central bank," they can take that idea and shove it where the sun don't shine.

Tue, 10/25/2011 - 22:12 | 1810873 zorba THE GREEK
zorba THE GREEK's picture

The Vatican might be on to something, seeing how well

central planing is working out for Europe.  The Vatican has not been able 

to come up with a credible plan to rid its organization of child molestors

for nearly 2000 years. So what makes them think they can come up with

a plan to solve the worlds' financial crises? Like the politicians in Washington,

the Vatican is out of touch with the real world. If there was any real justice in

the world, the Catholic Church's central leadership should be tried for crimes

against humanity for their role in the global coverup of sex crimes involving

children. 

Wed, 10/26/2011 - 04:32 | 1811431 frenchie
frenchie's picture

hm

and what about all these muftis and rabbis sodoming boys around the world ?

Wed, 10/26/2011 - 11:21 | 1812664 hvl626
hvl626's picture

Are you including members of the Sanhedrin who kept adolescent wards of the Temple in their homes and found to be impregnated at puberty around 7-5 BC ?

Tue, 10/25/2011 - 21:20 | 1810670 equity_momo
equity_momo's picture

Good spot. So whats next ? Whats the agenda? One currency? Would that benefit tptb? What do the vatican want -control/power. How do they get that? Bomb more brown people? Cause a global meltdown to starve out the threat? and force their flock to remember who provides the fish and bread? As usual , more questions than answers.
There are so many ways to divide and conquer now , tptb have got it made. Theyre loving this.

Tue, 10/25/2011 - 23:15 | 1811081 i-dog
i-dog's picture

"Good spot."

The 'hat tip' goes to "Ahmeexnal" ... if he hadn't posted this on Monday, I wouldn't have even known about it!

"So whats next ? Whats the agenda?"

The agenda is "Problem. Reaction. Solution" or, as Hegel put it "Thesis. Anti-thesis. Synthesis". Create a problem (FED bailouts; European indecision), promote a reaction (#OWS; public outrage), then offer a [seemingly rational] solution (Global Central Bank; One World Government).

The solution that is put forward is totally pre-planned before the problem is deliberately created. It's all scripted and stage-managed.

"What do the vatican want -control/power."

The Vatican is just one organ of TPTB ... a very large organ with hundreds of thousands of priests, academics and 'knights' plus 2 billion adherents -- particularly concentrated in Southern Europe (the PIIS of the PIIGS) and Latin America (from Mexico to Tierra del Fuego). It is now controlled by the Jesuits (the Jesuits and the clergy have been fighting each other for centuries over control of the Vatican, but the Jesuits have been in continuous control now since before WWI).

So "yes", those who control the Vatican (the Jesuits and their brothers-in-Lucifer Labor Zionists, the Sabbateans) do wish to use the Vatican to control the serfs through propaganda and "the infallible [sic] authority of the Pope" ... but the One World Government would be the centre of executive power. The priests always work in concert with the rulers: the rulers manage the aristocracy and the priests manage the serfs.

"tptb have got it made. Theyre loving this."

I disagree. Central planners always fuck things up. I think that Europe has blown up prematurely for them (ie. prior to the final shutdown of the US) and that they are now scrambling to keep the EU together at the moment. IMO, they originally wanted to expand the EU to include the former-Soviet East European states and the North African states, but Gaddafi's resistance pushed their schedule and global acceptance out of whack.

So, I don't think they're loving this at all at the moment! And if any European or US states were to secede, then their plans would be shot to ribbons ... they'd have to resort to fascist force rather than political cunning to "herd the cats" -- and that could cause dangerous blowback. :)

PS. SECEDE NOW!! (If you can't get your state to do it, then just do it personally).

Tue, 10/25/2011 - 21:40 | 1810756 Mr_Wonderful
Mr_Wonderful's picture

The Vatican?

How many divisions do they have?

--- J. Stalin

Wed, 10/26/2011 - 01:02 | 1811218 i-dog
i-dog's picture

LOL. The Jesuit-trained crypto-Roman Catholic Joseph Djugashvili (“Son of Steel”) Stalin (“Man of Steel”), certainly would have known. His 'job' was to eradicate the 'heretic' Orthodox Church from Russia ... at which he appears to have been quite efficient - certainly more efficient than he was at feeding the Russians or developing their infrastructure. ;)

Tue, 10/25/2011 - 21:42 | 1810766 erumisato
erumisato's picture

So it's the Jesuits who pull Jones's strings after all. I held out (some)hope that he was the real deal.

Tue, 10/25/2011 - 21:56 | 1810815 i-dog
i-dog's picture

Yep. As I said in another thread earlier today (while the story was still running, but without any commentary from Alex or his editors), he's blown his cover with this one!

Tue, 10/25/2011 - 23:13 | 1811097 erumisato
erumisato's picture


It seems that everyone is a god damned double agent anymore, so I'll still listen to him. He's still a hell of a lot better than pretty much any other radio talking head. Something started to smell fishy to me after he kept on having Steve Pieczenik come on his show after he professed how much he loved Don Papa Bush as POTUS. The irony here is that it's from listening to Jones and a couple of other sources that got me to the point where I can understand how some of these fucks think and operate, and the ability to recognize the mechanisms that they use to sway opinion and to disseminate (mis/dis)information. 

Wed, 10/26/2011 - 00:11 | 1811239 i-dog
i-dog's picture

Like you, I learned a lot from AJ and consider most of his information to be accurate and helpful. But after finding out about his true background, and also earlier considering this perspective from Alan Watt, I found it impossible to continue to listen to AJ's rants and obvious hiding of the real puppet-masters.

I do still check his website occasionally and also listen to the occasional interview to see how he and his guest handle a particular topic.

Wed, 10/26/2011 - 01:06 | 1811316 erumisato
erumisato's picture

Watt hosts perhaps my favorite radio show. I'm sure that there's more to him than meets the all seeing eye as well. Same with Jeff Rense. All of them have some fantastic information, but each one has certain topics that never seem to be explored very deeply on their respective shows. Between those three and old William Cooper broadcasts, along with my daily dose of ZH and the Daily Bell, and the follow up research on the topics they cover, I've received an education that's more relevant than any BA degree.

 

 

Tue, 10/25/2011 - 22:14 | 1810847 Dapper Dan
Dapper Dan's picture

Good thing I printed and saved this,

Vatican Calls for Global Oversight of the Economy

By ELISABETTA POVOLEDO 

Published: October 24, 2011

o     

VATICAN CITY — The Vatican called on Monday for an overhaul of the world’s financial systems, and once again proposed the establishment of a supranational authority to oversee the global economy, saying it was needed to bring more democratic and ethical principles to a marketplace run amok.

Connect With Us on Twitter 

Follow @nytimesworld for international breaking news and headlines.

In a report issued by the Pontifical Council for Justice and Peace, the Vatican argued that “politics — which is responsible for the common good” must be given primacy over the economy and finance, and that existing multinational institutions like the International Monetary Fund have not been responding adequately to global economic problems.

 Update:  article is on Alex Jones web site just bumped down, not that I go there much ;)

 Here is an invaluable tool for my fellow ZH crew.  These people have our backs. 

http://www.archive.org/web/web.php

Tue, 10/25/2011 - 22:15 | 1810881 CrazyCooter
CrazyCooter's picture

My thinking, up until very recently, was that this "collapse" was just part of the script.

I don't think that anymore.

The Vatican is "telling" great weakness with this position in the media; they are clearly fucked if Europe blows up.

I really thought the real (i.e. final) crash would be after the next election, not before it. This is a huge X factor in political plans, to fuck the serfs over a barrel before they get to choose a House, part of a Senate, and a President.

Not to be US centric, but we are the worlds policeman and such things have to factor into real decision making (from an elite perspective).

Wow, just fucking wow.

And thanks for sharing. I got the word out to my five readers. :-)

Regards,

Cooter

Tue, 10/25/2011 - 23:54 | 1811210 Saxxon
Saxxon's picture

Yes crazycooter, something like that; or the Vat is trying, like the ratings agencies last week, to jump ahead of the parade before the shitbag blows up.

Who doesn't despise the lamprey banking system and its handlicking attendants (Sarkozy, Merkel, Obama, et al.).

Tue, 10/25/2011 - 20:56 | 1810596 msmith
msmith's picture

More EU problems will begin to weigh heavily once again on equities.  - After the correction for the SPX today, price action should push higher for the next several days.  The DX continues to look bearish in the short term as the EURUSD is pointing higher with equities.  More "risk on" ahead. http://bit.ly/uFJB9g

Tue, 10/25/2011 - 21:27 | 1810700 ISEEIT
ISEEIT's picture

Wouldn't count on it. AUD seems to be decoupling from the EUR. That it not 'risk on'. To soon to really call it but I've been out of the EUR for the past month and am short AUD. It's a cheaper trade than EUR and will fall victim to USD strength whether via EUR going soft or global slowdown. My reasoning is that AUD drops regardless of EUR shenanigans.

Time will tell.

Tue, 10/25/2011 - 22:21 | 1810900 chump666
chump666's picture

I agree, looks like the market is going risk averse and the AUD is a good gauge.  Markets look thin right across the board. 

Wed, 10/26/2011 - 05:13 | 1811445 letitgo
letitgo's picture

AUD was smashed by lower than expectation inflation figures and the consequent higher likelihood of a rate cut next week.  Its big moves will be on those factors for a while.

What's interesting right now is how the EUR is staying strong against the USD, GBP etc.  My guess is that non-Europeans are finally starting to work out that the EZ is less prepared to print than its counterparts.

Tue, 10/25/2011 - 20:57 | 1810600 Stagflationary
Stagflationary's picture

Why would there be an end-game? Other than wishful thinking can you explain what would trigger such an event instead of continued postponement of the end?

Tue, 10/25/2011 - 21:07 | 1810624 iLoveMisesToPieces
iLoveMisesToPieces's picture

Because at some point you have to have capital and not just a bunch of paper.

Tue, 10/25/2011 - 21:11 | 1810635 Stagflationary
Stagflationary's picture

Sure, but what makes that point this week? I'm sure a minimal amount of capital can be provided, accounting rules fudged to prevent mark-to-market, etc. for a very long time. After all, Greek current deficit is peanuts when spread across Europe's 500mm peeps.

Tue, 10/25/2011 - 21:27 | 1810701 iLoveMisesToPieces
iLoveMisesToPieces's picture

It looks like the prisoner's dilemma is breaking down.  TPTB aren't a homogenous unit, they just use each other to perpetuate the ponzi.  The weak links have cracked so now their only option is to toss each other under the bus and hope to come out the least unscathed.  The only reason the ponzi works is because enough of these groups conspire to make it work.  You can only flip paper back in forth so long as people with capital will trade that capital for paper.

Wed, 10/26/2011 - 02:19 | 1811368 Which is worse ...
Which is worse - bankers or terrorists's picture

This has been said for years. When is the tipping point?

Tue, 10/25/2011 - 21:01 | 1810601 knukles
knukles's picture

ECB has a Western Syndicate style Capital Call Arrangement?
You have got to be kidding me!
Those fuckers are absolutely batshit unbelievably crazy.
Deutscheland!  You best be a printing a whole bunch of new D-Marks and be getting' ready to walk the tab.
That is just down right irresponsible.
You got some old timers to hang out to dry.
Everybody else says "No" and you own it.
Musical Chairs.
Best just walk the game.
For shit sake, there is No Way Out!

(maniacal laughter)

Tue, 10/25/2011 - 22:23 | 1810909 CrazyCooter
CrazyCooter's picture

With the caveat, of couse, there is no way out for any of us!

When it blows, its going to bring it all down.

But the oil can still be pumped from the ground, dams will still generate electricity, farms will still be growing crops in the sun. Humans will carry on, just not so many ...

Regards,

Cooter

Tue, 10/25/2011 - 20:58 | 1810603 navy62802
navy62802's picture

Listened to Peter on Bloomberg Radio this afternoon on the way home from work. Good interview.

Tue, 10/25/2011 - 20:59 | 1810605 Mr. Sheeple
Mr. Sheeple's picture

Is this the first domino? I mean we've been waiting for the situation to start going horizontal for months now.

Tue, 10/25/2011 - 21:05 | 1810618 navy62802
navy62802's picture

All it's going to take as a massive write-down of Greek debt. "Haircut" my ass. The economic gurus of Europe have been throwing around numbers like 50% and 60%. That's not a "haircut" in the least. It's more like a disemboweling. Enough to trigger CDS contracts and demolish many major banks across Europe.

Tue, 10/25/2011 - 22:32 | 1810949 CrazyCooter
CrazyCooter's picture

Yup, Greece is itsy bitsy, but ...

http://www.youtube.com/watch?v=XM2TbddOhN0

... watch those counterparties go up in flames!

Oops!

Regards,

Cooter

Tue, 10/25/2011 - 21:01 | 1810607 Sequitur
Sequitur's picture

Breaking: ex-Goldman Sachs director surrendering to FBI. Don't know the reason yet.

Tue, 10/25/2011 - 21:26 | 1810697 knukles
knukles's picture

He's Goldman's latest Campaign Contribution.

Tue, 10/25/2011 - 23:00 | 1811058 mayhem_korner
mayhem_korner's picture

 

 

Trial will last until Jan 18, 2013.  Conviction and sentencing to come down 36 hours before a Presidential Pardon by an exiting Barry.

Just sayin'...

Tue, 10/25/2011 - 21:01 | 1810608 johngaltfla
johngaltfla's picture

IF you have a FT account, may I suggest everyone read this story:

http://www.ft.com/cms/s/dccc8d98-ff03-11e0-9b2f-00144feabdc0.html

Bankers fear political moves will kill off CDS

Because if they do kill CDS for the hedge funds and banksters with a "non default default" and do not pay out, this will be akin to the portfolio insurance unwind in 1987.

Tue, 10/25/2011 - 21:10 | 1810609 poor fella
poor fella's picture

I don't think that 20th '5-Hour Energy' is going to help any of these people.

(and would give Tyler's left nut to be a fly on the wall of these meetings)

Tue, 10/25/2011 - 21:03 | 1810612 granolageek
granolageek's picture

I looked carefully, and there is no mention of what the Dutch actually said. Not winning for Peter, not winning for Tyler.

Tue, 10/25/2011 - 21:40 | 1810755 Ahmeexnal
Ahmeexnal's picture

Well, that would be because there was no actual exchange of words.

Queen Beatrix flipped Merkel off.

End of story.

And end of the euro.

Wed, 10/26/2011 - 00:25 | 1811262 i-dog
i-dog's picture

Beatrix is definitely in on the NWO scam (whereas Merkel is just an elected functionary). I suspect Beatrix was showing her irritation with Merkel's obstinacy on behalf of the German people (read: courts and political factions). Then again, I could be wrong....

I would not count on the Dutch being the first to pick up their bucket and spade and change play pens.

Tue, 10/25/2011 - 21:59 | 1810826 Sabibaby
Sabibaby's picture

I don't speak dutch

Tue, 10/25/2011 - 22:09 | 1810857 hannah
hannah's picture

i think the dutch said...

 

"

I don't want to talk to you no more, you empty headed animal
food trough whopper! I fart in your general direction! You mother
was a hamster and your father smelt of eldeberries.

"

or something like that....

Tue, 10/25/2011 - 22:46 | 1811000 Calmyourself
Calmyourself's picture

More importantly what kind of sparrow?  hmmm..

Tue, 10/25/2011 - 23:34 | 1811166 s2man
s2man's picture

A coconut?

Tue, 10/25/2011 - 23:48 | 1811198 knukles
knukles's picture

Snarkozie called Fraulein Merkel an Inflated Truffle Whore. 
Which wasn't nice.
Right after she called him an Insecure Small Penis with a Napoleonic Complex. 
(2 points to the Fraulein for the double entendre)
And Silvio "Bunga Bunga" said thet he was offended by the language so he was gonna go back home to Rome to his 12 year old Libyan sex slave for a day or two, and that he really missed Gaddafi, and blamed Snarko for the French starting the shitstorm on his party pal. 

Tue, 10/25/2011 - 22:24 | 1810911 Rogier
Rogier's picture

Dutch finance minister Jan Kees de Jager today merely said that 'Italians got to do more' and 'we won't accept the 21% PSI'. That's it. Kinda sad that Peter Tchir implies more than there really is and shame on Zerohedge for not doing some very basic level of fact checking.

Tue, 10/25/2011 - 21:29 | 1810616 Reese Bobby
Reese Bobby's picture

Not worth the words...

Tue, 10/25/2011 - 21:05 | 1810619 xcehn
xcehn's picture

Europeans should demand a referendum in every country on whether to liberate themselves from the tyranny of the bankster puppets and breakup Euroland.

Tue, 10/25/2011 - 21:11 | 1810620 virgilcaine
virgilcaine's picture

By dragging this on so long they are in effect killing the economy drip by daily drip.  An endless barrage of negativity and shown in the Consumer Conf No.s .Sheep like to herd and shop, now they are seperated and running scared..  .baah..

Tue, 10/25/2011 - 21:08 | 1810630 Conax
Conax's picture

Hansel and Gretel : 'Verdammt, Angela, soll das ein Witz sein?'

Timmuh: No problemo, we have your back.  We are exceptional.

Tue, 10/25/2011 - 21:08 | 1810631 max2205
max2205's picture

Think there is no FED market manipulation? Just look at the positive ES tonight. Unreal

Tue, 10/25/2011 - 21:13 | 1810642 RobotTrader
RobotTrader's picture

Euro is still over 1.39

ES still hanging tough over the 50-day

Looks like the Europe crisis is over.

Tue, 10/25/2011 - 21:26 | 1810696 The Axe
The Axe's picture

Yes, all over, . Europe is fine..did you see FSLR,NFLX,AMZN....now those are haircuts...

Tue, 10/25/2011 - 21:39 | 1810734 WonderDawg
WonderDawg's picture

Yes, I'm sure of it. The Europe crisis is over. All that toxic debt? Forget about it, the crisis is over. The CDS chain reaction to a Greek default? Ignore it and it will go away. The crisis is over because the Euro is still over 1.39. Sleep tight, brighter days lie ahead.

Oh, and don't forget to BTFD on Netflix.

Tue, 10/25/2011 - 21:44 | 1810773 knukles
knukles's picture

Was it Robo who was going all banana shit over NetFlix a while back?  Going to infinity?  Ah well, maybe he'll work that out before he takes on all the longs opposite Goldilock's new Euro shorts.  He's a good little counter-party.

Tue, 10/25/2011 - 21:50 | 1810799 Ahmeexnal
Ahmeexnal's picture

Robo recommending a stock is like the kiss of death.

What is he peddling now so I can go short and earn some toilet paper?

Tue, 10/25/2011 - 22:55 | 1811032 Calmyourself
Calmyourself's picture

What, you did not hear? Chain linked CDS have been outlawed everyone is being refunded their premiums on those.  Shorting Netflix is also outlawed have a nice evening..

Tue, 10/25/2011 - 21:39 | 1810735 equity_momo
equity_momo's picture

Lets play Wheel of fortune , Robo :

Your letters are - D , G , A , O , U

_ O U A _ _
A
G _ A _ _ D O U _ _ _

And its a factual statememt.You have 20 seconds Robo. Clue is "look in the mirror or in your bathroom"

Tue, 10/25/2011 - 21:36 | 1810736 Corn1945
Corn1945's picture

How do you have any money left to pay your internet bill?

Tue, 10/25/2011 - 21:39 | 1810751 chump666
chump666's picture

What the f*ck do you smoke?  The biggest sell off since Aug is a c-hair away.  Europe is finished.  There is NO way Italy will play ball...and 60% haircuts?  That a grade A default = Greece.

Tue, 10/25/2011 - 22:26 | 1810922 Almost Solvent
Almost Solvent's picture

This guy I know got Rosetta Stoned - that's when the shit's so good it has one speaking in different languages

Wed, 10/26/2011 - 07:01 | 1811518 machineh
machineh's picture

... including off-planet and double-helix ones.

Tue, 10/25/2011 - 21:18 | 1810661 Tuffmug
Tuffmug's picture

Sarkozy, Timmy, and Ben getting bitch slapped by Merkel and the Bundestag. Germans blocking Euro QE and will stop the ECB PIGS bond purchases. No one wants to pay for this and it would eventually have to be funded by QE money printing.

Tue, 10/25/2011 - 22:38 | 1810979 TheFourthStooge-ing
TheFourthStooge-ing's picture

Sarkozy, Timmy, and Ben getting bitch slapped by Merkel and the Bundestag.

With Sarkozy calling Merkel a retarded truffle hog, nobody should be surprised by this.

 

Tue, 10/25/2011 - 21:23 | 1810689 Belarus
Belarus's picture

I don't know why at the end of the day anyone believes Germany will risk everything, everything as in cueing David Tepper, to backstop Greece, then Italy, then Spain, then Portugal, etc. That would be akin to putting your balls in a vice while having Natilda the Hun, who turned into a man hater, cranking it down on them where pain hits new nadirs of morbid curiousity.

Look what happened to Greece, when over a year ago the yield was 7%, and they promised austerity....but times that by 10, with Italy, Spain, and ulitmately France, too. Any small shock to their economies or outright social unrest due to austerity and it's be game over for Germany. Who'd want to take that chance.

At the end of the day, the only way this works--kicking the can--it to get help from Uncle Sam and others, and given the political situation: good luck to that one as OWS multiples by 1000.

In other words, we're fucked. And it's only a matter of time now gentleman.  

Tue, 10/25/2011 - 21:25 | 1810693 Conax
Conax's picture

Embrace the doom.

They might be kickin the can to the meeting next month. But the G20 might get disrupted by scary protesterrists. That would be too comical.

Shut it all down, foch it.

Tue, 10/25/2011 - 21:35 | 1810732 jmcadg
jmcadg's picture

'optimisations' I am correct that they are alluding to 'leverage' of the EFSF.
Finally!

Tue, 10/25/2011 - 21:36 | 1810733 chump666
chump666's picture

Looking forward to Italy saying "Vaffanculo" to Germany and France in less than 48 hrs.

Merkel needs to slam Italy sideways if she wants the 60% writedown on the PIIGS junk

 

 

Tue, 10/25/2011 - 21:40 | 1810747 knukles
knukles's picture

BTW, I'd like to publicly thank all you clueless leaders of Europe for bailing out my portfolio positions these last few days.  Late September was tough on bonds and PM's when the rest of the world seemed to actually think that you had your shit together opposite a soluble problem, to neither of which I'd subscribed.  Y'all can make one very skittish at times, which you really don't want to do. Hurts the old credibility, so to speak.  But all's on track as anticipated in spite of the scare so, all's forgiven.
Thank you.
God Bless You. 
May You Live Long and Remain at Your Helms Forever.

Tue, 10/25/2011 - 21:44 | 1810770 steve from virginia
steve from virginia's picture

 

Many words, all meaning the same thing: Europe's broke.

It's hard to pay for things when yr broke. I know, I've been there.

The simplest solution would be for individual European countries to start issuing -- or borrowing -- their own currencies to use within their own countries. They could keep the euro as a reserve currency. The amounts of legacy debt that individual countries could manage would be bought back with the local currencies, the rest locked away in the EFSF deep freeze. After a stringent energy conservation plan is put into place the debts can be restructured a bit at a time. There is a lot of leeway when €400bn isn't going overseas every year for no good reason.

Another solution is for ECB to monetize coupon spreads. How much debt does Italy have to roll over next year? €120bn? What's the coupon? 5.5% - 10 yr? Why not Italy pay 2% and the ECB lend what's needed to pay the rest? Debt monetization on the cheap! The EU's could couple this with a crackdown on bank crooks. A bank here, a bank there and after 6 months the desire of bankers to play rate games is diminished. Bankers can raise interest rates as Bill Clinton found out to his dismay, by (real) government leaders can chop bankers' heads off with a guillotine.

I understand the head is aware of what's going on post-chop. "How do ya like the rate now, sucker?"

What will happen instead? Nothing. Arguing. Denial of any energy problems. Blame game. Bankruptcy.

After that it gets interesting.

Tue, 10/25/2011 - 21:43 | 1810772 Bansters-in-my-...
Bansters-in-my- feces's picture

FUCK THE VATICAN.

Tue, 10/25/2011 - 22:30 | 1810939 earleflorida
earleflorida's picture

does this mean another holy war?

Tue, 10/25/2011 - 23:49 | 1811201 knukles
knukles's picture

No, it means more sex with the underage altar boys.

Tue, 10/25/2011 - 21:48 | 1810793 thurstjo63
thurstjo63's picture

The groundwork has already been laid for the Germans to leave the Euro zone. http://www.pippamalmgren.com/77.html

If the ECB keeps printing money to buy bonds, it will happen. The EFSF is basically dead on arrival as the fund is far shorter than what is necessary to even shore up Greece!!!

Just waiting for the ball to drop.

Tue, 10/25/2011 - 22:26 | 1810924 chump666
chump666's picture

+1

Tue, 10/25/2011 - 21:50 | 1810801 M.B. Drapier
M.B. Drapier's picture

Yes, the same members that back the EFSF.

Plus the ones that don't anymore, as the ECB obligations have no stepping-out mechanism comparable to the EFSF's. So either Ireland, Spain and Portugal would be stuck with a "surprise" ECB contribution at just this inconvenient time, or the core would have to agree to give them a free ride. It would be quite a spectacle either way. And the same applies to Italy...

Not that I'm certain that Europe will go the collateral-call route. It seems plausible that instead they'll either print away the loss, or kick the can once more by not imposing any loss on the ECB even if that makes the Greek haircut deeply insufficient.

Tue, 10/25/2011 - 21:50 | 1810802 Mr_Wonderful
Mr_Wonderful's picture

Just downloaded and watched Margin Call.

A bit superficial Wall St. tale but still worth watching. 

Tue, 10/25/2011 - 21:55 | 1810818 Belarus
Belarus's picture

The solution to Europe is simple: The Vatican is doing so well that if they franchised it and opened up a few in Greece, more in Italy, some in Spain, and possibly even France that they could very well close their fiscal gaps in a big way as they will find a whole new revenue stream from the massive tourism windfalls.  

Tue, 10/25/2011 - 22:02 | 1810839 CashCowEquity
CashCowEquity's picture

Robo-Gayder?

Wed, 10/26/2011 - 04:03 | 1811422 akak
akak's picture

HoboTrader

Tue, 10/25/2011 - 22:11 | 1810871 hannah
hannah's picture

no one will stand up and leave this party...they will kick the can down the road til they all fall off the edge of the cliff.

 

if one dies they all die so they will kick kick kick.....

Tue, 10/25/2011 - 22:57 | 1811044 earleflorida
earleflorida's picture

it will never fall off the cliff no matter how much they scream - eventually it will rest at the horizons' time-line,  where parallel lines eventually meet, and paradoxically the shortest distance between two points is a curve, with the quasi enigma that there is no such thing as a straight line says emphatically the ultimate chaos we venture into daily is but a universal illusion of a classic circle jerk - ironically until the many meld into one - which could be as simple as flipping a card or rolling snake-eyes - where no one dies except through attrition,... with the only certainty of randomness is no one wins in the end?

cheers 

Wed, 10/26/2011 - 00:28 | 1811272 mjk0259
mjk0259's picture

They can kick the can for years yet.

Wed, 10/26/2011 - 01:10 | 1811323 lolmao500
lolmao500's picture

Time to downgrade Germany!

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