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Buyers Of Last Resort: As Dumping Accelerates, Here Is Who Is Stuck Buying Another €741 Billion In Italian Bonds

Tyler Durden's picture




 

Spoiler alert: There will be no surprise "I see dead bondholders"-type ending here. Having suggested precisely what the BTP trading dynamics look like previously, we now get official confirmation. With everyone else dumping Italian bonds in the open market, there are only two parties on the bid side: the ECB, and Italian banks. That's it. The only question is "how much" in order to determine at what point the selling onslaught will overhwhelm both insolvent Italian banks whose Risk Weighted capital will soon become too high forcing them out of the market, as well as drag down Draghi's recently expanded bond buying desk (we would say trading, but that would imply a two way market). Here is Barclays with the full breakdown: "Italy’s government bonds, representing the largest bond market in Europe, or the third largest in the world, have been particularly unstable since the beginning of July. The sheer size of the €1.6trn outstanding stock, of which around €220bn of bonds and €120bn of bills are rolled over every year, begs the questions who will be the buyers going forward. We thus update the breakdown of Italian bond holders which we presented in July (see Who Owns Italy's Government Debt? July 29, 2011), and analysed who has been selling and buying between the beginning of July (when widening started) and end of September (as of the latest available data). ECB has been the main buyer since August 8th, and held 4% of the Italian bond market as of September. Domestic holders, mainly financial institutions (banks) have gradually increased their holdings, taking domestic holding from 55% to 56% of the total market. Foreign investors, consisting of European non-Italian banks and real money investors as well as international asset managers, have been the main seller of BTPs, reducing their holdings from 45% to 39%." As said earlier - nothing at all unexpected: everyone who can get out is getting out. The only buyers are those for whom selling equates to suicide. That said, we wish Italian banks and the ECB the best of luck as they seek to purchase the €741 billion in bonds that are still to be offloaded as Merkel persists in refusing to let the ECB even considering announcing monetization intentions.

Lehman, pardon Barclays, with the full Monty:

Summary

  • We present the changes in the breakdown of Italian government bonds holders between end of June and September:
    • ECB’sSMPprogramhastaken4%of the market as of September
    • Domestic investors have been gradually increasing their holdings, by a total of 1%
    • Foreign investors have been the main sellers, reduced their holdings by 5%
  • The funding risk for Italy and all other sovereigns remains critical, as shown by recent weak sovereign auctions. The funding issue is not only limited to sovereigns, banks have also been increasing their reliance on the ECB

ECB – Biggest But Not the Only Buyer in Town

Undoubtedly, ECB’s SMP program has been the biggest buyer of Italian debt since its re-activation on August 8th. The buying has been concentrated on 2-10y nominal BTPs. While the spread tightening effect has faded away, it has effectively absorbed a substantial portion of the Italian bond market, €67bn in notional size or 4% of the total market as of end of September, based on our estimate. This includes the €12bn of increased holding by the Banca d’Italia, which has risen proportionally as the share of Banca d’Italia’s contribution towards the ECB (17.86%). The size as of November 17th was €100bn, or 6.2% of the market.

Italians Banks – Supporting Italian Government Bonds

Domestic investors, who already held 55% of the market before the July widening (including Italian funds managed abroad), have gradually increased their holdings since July up to the end of September as data suggest, to 56% or an increase of €14bn.

In particular, domestic financial institutions (mainly banks) have been the main domestic buyers, increasing their holdings by €23bn to €267bn. This has been in line with our expectation that domestic banks should be the long-term potential buyer due to the tougher regulatory environment.

Other domestic financial institutions (investment funds and insurance companies) have reduced some of their holdings, by €13bn to €247bn, which may have contributed by the index rebalancing among the benchmark investors, as we expected.
Finally, domestic retail investors’ holdings (corporate, households and private wealth management) data is delayed, with the end of July remaining the latest point, which remains stable at €214bn. We expect such holdings to stay stable if not higher, as the incentive for domestic households holding government bond is higher than for other assets due to lower capital gains taxes from January 2012 (12.5% vs 20%).

Selling Emerged from International Investors

The data for foreign investors’ holdings is also lagged; however, given the increase in holdings by domestic investors and the SMP’s purchase, it is reasonable to assume that the main sellers of Italian government bonds have emerged from international investors, by as much as €80bn – within which we estimate that non-Italian European banks and real money investors (insurance and mutual funds) have sold €40bn in total over the period. The remaining portion of the liquidation of €40bn has likely come from international asset managers who have been rebalancing their index to either reduce their exposure to Italy or have moved towards some type of AAA or GDP weighted index in the first few months of the widening.

Ongoing Sellers?

Continued selling post September, evidently prompted by SMP’s increased purchases and Italy’s rising yields since then, has more likely been due to deteriorating confidence beyond the initial index rebalancing. Foreign holders, especially non- European investors, who currently hold €271bn (17%) of Italian bonds, are likely to be on the front line of sellers going forward if the bearish outlook continues. The European banks and real money investors, who hold €344bn (21.6%), may be relatively stronger hands due to the large portion of Italian government bonds present within the European bond market (24%) as well as the regulatory regimes. However, this will depend on investors’ willingness to refinance the ongoing selling of Italian bonds by the government itself, with bond gross issuance €220bn a year and another €130bn of T-Bills.

Who Will Be the Buyers?

While it is encouraging to see that domestic investors have been stepping up their holdings, in line with our expectation, the move has been gradual. The slow path has also been overshadowed by the selling flows on the back of deteriorating confidence. Although it remains our key assumption that domestic insurance companies [ZH: got ASSGEN and ZL CDS yet?], will be the potential long-term buyer, the interim uncertainty and volatility certainly calls for a more urgent buyer.

The SMP, which has achieved some rebalancing role during the initial underperformance, has failed to backstop the Italy yield level or provide sufficient confidence for investors to retain their holdings. Nevertheless, the capacity of the SMP is not limited by any technical constraints: the ECB’s balance sheet can expand without limit while the sterilization process is ensured as long as there is ample excess liquidity in the system. The constraint only depends on the ECB’s willingness, both politically and their willingness to be exposed to sovereign credit risk.

Funding Risk for Sovereigns and Banks

The formation of the new Italian government has been welcomed by the market. However, our economists highlight the very poor growth outlook and implementation risks related to fiscal consolidation. The ongoing funding worries for a number of sovereigns and the banking system also stand as a key risk, especially going into year-end as balance sheet constraint amplifies.

This week we have had a failed Belgium 3-mth and 12-mth T- bill auction, an uncovered 2y German auction and a very weak Spanish 10yr auction – all pointing to the increasing worry over funding events for sovereigns, even for very short- dated T-bill issuance. The funding crisis is not only limited to sovereigns, but their close link, banks, are also facing increasing short-term funding difficulties and countries that have relied less on the ECB have now been catching up (Exhibit S2). Italy, Spain and France in particular in the last few months have ramped up their borrowing from the ECB as funding dries up in the market.

In addition, this week’s MRO saw a sharp rise in usage by €35.5bn, which has coincided with last week’s increase in initial margin for BTP repo positions by leading clearing houses. The increase in margin has likely had a negative impact on funding position of banks holding BTPs, especially domestic banks. We estimate banks would have to find an extra €5-16bn to fund this additional haircut for their BTP repo positions in CCPs, and this is not to mention the volatility of BTPs since then, which could have had additional impact on margin calls

 

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Sun, 11/20/2011 - 14:40 | 1895986 GeneMarchbanks
GeneMarchbanks's picture

'Although it remains our key assumption that domestic insurance companies [ZH: got ASSGEN CDS yet?], will be the potential long-term buyer, the interim uncertainty and volatility certainly calls for a more urgent buyer.'

Bye-bye Intesa & UniCredit. Poor iTalians.

Sun, 11/20/2011 - 15:01 | 1896047 css1971
css1971's picture

Basel III rocks!

Sun, 11/20/2011 - 15:47 | 1896185 sabra1
sabra1's picture

thought for a second you meant Hazel rocks!

http://www.youtube.com/watch?feature=player_detailpage&v=kGZ68ErIsb4

Sun, 11/20/2011 - 15:28 | 1896126 cossack55
cossack55's picture

Over the past several years I have been framing and Xmas gifting Zimbabwe, Weimar and Hangarian currency. Always well received with snickers or ever outright guffaws.  I would be more than happy to buy some BTPs, must be under $10/certificate tho.  I'll take 16 please. Contact me for mailing address.

Sun, 11/20/2011 - 15:39 | 1896161 Sudden Debt
Sudden Debt's picture

And i thought spain would take centerstage this week :)

Sun, 11/20/2011 - 15:53 | 1896203 Ghordius
Ghordius's picture

No, the banks are extending to Italy and the Netherlands.

Sun, 11/20/2011 - 20:54 | 1897090 Buck Johnson
Buck Johnson's picture

What happened is that the Italian govt. told it's banks and financial institutions to buy Italian bonds (which leads to if they started to sell it would be suicide to the economy).  Everyone's getting out because they know that Italy will go through a "controlled" default.

Mon, 11/21/2011 - 01:03 | 1897640 bigun
bigun's picture

they playing dis game called pass the hot potato

except its really a FUCKING BOMB; ECB & italian banks will be blown to smithereens; along with the rest of us innocent bystanders - well i know i wont be finding a job in 2012 when i graduate

gg

 

Sun, 11/20/2011 - 14:42 | 1895990 Ahmeexnal
Ahmeexnal's picture

How about a chart indicating who is buying german reichbunds?

Sun, 11/20/2011 - 15:01 | 1896048 Eally Ucked
Eally Ucked's picture

We only know who's sellling but we want to know who's buying that's really good question

Sun, 11/20/2011 - 15:36 | 1896151 reload
reload's picture

ECB Proxies: with 0% ECB loans funded via fed swap lines. Also helps the Euro keep a bid.

OK - I am guessing, but who would be remotely suprised?

Sun, 11/20/2011 - 15:52 | 1896196 Ghordius
Ghordius's picture

Late Seventies again
Then the banks involved were national and stuffed with it

Nah, this will be a LONG game, methinks...

Sun, 11/20/2011 - 14:43 | 1895993 High Plains Drifter
High Plains Drifter's picture

i have heard it said that one in six amerikans work for the government. how many italians work for the government as a percentage of the workforce?

Sun, 11/20/2011 - 15:03 | 1896052 Ahmeexnal
Ahmeexnal's picture

More like...how many iTalians watch Internazionale vs. Juventus during worktimes in government offices?

Sun, 11/20/2011 - 15:26 | 1896122 High Plains Drifter
High Plains Drifter's picture

that's what i mean. with this adjustment coming down the pike, the world in italy will be turned upside down. perhaps we should watch it and remember that this movie is coming here.

Sun, 11/20/2011 - 16:26 | 1896296 earleflorida
earleflorida's picture

just like the clint eastwood spaghetti westerns

Sun, 11/20/2011 - 15:30 | 1896135 Neidhammel
Neidhammel's picture

Percentage of nogoodniks in

Dolce Vita: 2.3

Fakelaki: 25 (!)

Sieg Heil: 14

Sun, 11/20/2011 - 15:40 | 1896162 reload
reload's picture

Good question - here in the UK just over 1 in 4 work directly for Her majestys government. Many more are reliant, as they work for firms who`s only client is the government. Defence contractors, refuse collectors, all manner of consultants etc etc.

Sun, 11/20/2011 - 15:51 | 1896193 sabra1
sabra1's picture

it's time the queen bitch wipes her own ass!

Sun, 11/20/2011 - 15:55 | 1896215 Ghordius
Ghordius's picture

Why do you wipe yours here?
Oh, sorry, it's your...what?

Sun, 11/20/2011 - 14:44 | 1895995 Gloomy
Gloomy's picture

MEANWHILE, BACK AT THE RANCH:

 

Lawmakers Concede Budget Talks Are Close to Failure

http://www.nytimes.com/2011/11/21/us/politics/lawmakers-concede-budget-talks-are-close-to-failure.html

Sun, 11/20/2011 - 15:10 | 1896075 Dick Darlington
Dick Darlington's picture

Waiting for Dick Bove report saying "the budget's fine".

Sun, 11/20/2011 - 16:59 | 1896365 earleflorida
earleflorida's picture

 just like it was, 'designed to fail', eh, and both party's declare vicory,... all the while obama's  backdoor-cuts for the entitlement programs that no republican could have ever accomplished, or even imagined [touching-the-3rd-rail] if they were in office -

think about it for awhile,...

when implemented in 2013[?] the automatic cuts will begin, 'but', with a 'war clause' that exempts military expeditures,... thus you have just a cut on the poor, period!

and, as far as i'm on the subject,... the bush tax cuts should be dropped across the board, with everyone paying their fair share

jmo

btw,... great post tyler

Sun, 11/20/2011 - 14:44 | 1895996 Cdad
Cdad's picture

Witheveryone else dumping Italian bonds in the open market, there are only two parties on the bid side: the ECB, and Italian banks.

Wait...make that three.  You forgot Larry Fink at BlackRock.  Of course, it is hard to tell whether he is a buyer or a seller, based on the discontinuity of the firm's comments from week to week.  So either it is three, including Fink, or everyone at BLK is a euro debt day trader now.

OCCUPY BLACKROCK!

Sun, 11/20/2011 - 14:47 | 1896008 Hulk
Hulk's picture

Blackrock = the new MFG. Get the fuck out of Blackrock while you can...

Sun, 11/20/2011 - 15:18 | 1896101 GeneMarchbanks
GeneMarchbanks's picture

Ummmm... AUM= 3T. Good luck to all those 'nimble' Canadian pension funds.

Sun, 11/20/2011 - 14:45 | 1896000 westboundnup
westboundnup's picture

Does anyone believe that there will ever be no buyers.  More specifically, does anyone believe they will allow there to be no buyers?

Even on judgment day, there will be buyers of bonds.

 

Sun, 11/20/2011 - 15:25 | 1896115 Amish Hacker
Amish Hacker's picture

The question is, At what price? The wages of sin are not adjusted for inflation.

Sun, 11/20/2011 - 17:29 | 1896453 DeadFred
DeadFred's picture

IMHO everyone is greatly underestimating what the Fed will do. This selloff is mostly due to a liquidity squeeze and the Fed does have the ability to create liquidity. I think they are waiting for the crisis to get to the 'proper' level. That means bad enough to have everyone screaming for help but not so bad that Ron Paul gets elected. My questions are 1) when will that be? 2) will they be able to keep inflation at the BAD level instead of the ZIMBABWE level? When is the next FOMC meeting?

Sun, 11/20/2011 - 14:55 | 1896002 Shadowsil
Shadowsil's picture

I just read something yesterday and am currently trying to find it again on Italians buying their own bonds..

The Italian citizens were buying their own debt..

 

http://www.reuters.com/article/2011/11/17/us-italy-bonds-idUSTRE7AG21I20...

Sun, 11/20/2011 - 14:56 | 1896035 Tao 4 the Show
Tao 4 the Show's picture

Italians hold much of the country's debt. Although the country is full of problems, the Italians themselves tend to have houses in the family and are conservative in other financial respects. The politicians are mostly criminals, though, and the unfortunate populace is likely to be badly robbed through all this.

New form of the Sword of Damocles. The politician kings can break the hair with any number of wrong moves, but the sword then falls on the people.

Sun, 11/20/2011 - 14:48 | 1896011 Gloomy
Gloomy's picture

If you don't know the name of the mark at the table, the mark is you.

Sun, 11/20/2011 - 14:48 | 1896013 bank guy in Brussels
bank guy in Brussels's picture

Italian banks buying Italian bonds, rather fits in with the proposal of Richard Koo of Nomura, that the national debt of EU countries should be sold primarily, and perhaps even exclusively, to persons and entities from that country.

Sun, 11/20/2011 - 15:58 | 1896221 Ghordius
Ghordius's picture

Well, it is much more stable this way
Less exposed to hot money

Sun, 11/20/2011 - 14:49 | 1896014 RobotTrader
RobotTrader's picture

So what's next for AA rated Uncle Gorilla Notes?

 

More dumping of Europe Bonds + Supercommittee Failure = U.S. Treasuries exploding to new highs on Monday?

Would not surprise me.

Sun, 11/20/2011 - 15:40 | 1896165 Nate H
Nate H's picture

supercommittee didnt fail. they just didnt agree - now across the board cuts - bullish for us bonds as we are recession bound for certain (plus euro situation is bullish USD and UST)

Mon, 11/21/2011 - 12:04 | 1896494 earleflorida
earleflorida's picture

not so fast - "I Want it Now!" - ref: http://www.fhfa.gov/webfiles/22775/TSYSupport11092011%20(2.).pdf     [problems :-( ]

 

http://en.wikipedia.org/wiki/Subprime_crisis_impact_timeline  

or___http://en.wikipedia.org/Subprime_crisis_impact

http://www.research.stlouisfed.org/conference/gse/Jaffee.pdf      [follow redirect]                                      

,... so who ya gonna call?

Sun, 11/20/2011 - 14:50 | 1896018 midgetrannyporn
midgetrannyporn's picture

Italian banks lever up, buy Italian bonds to infinity. Problem solved.

Sun, 11/20/2011 - 14:53 | 1896027 Zola
Zola's picture

Oops...

Sun, 11/20/2011 - 14:55 | 1896032 rufusbird
rufusbird's picture

Kyle Bass gets to say more in this 6 minute interview than he did in the 24 minute interview in the BBC broadcast. Effective interviewer asks questions and lets him answer. Good insight on the Euro debt.

http://www.gurufocus.com/news/153703/kyle-bass-speaking-at-the-darden-sc...

Sun, 11/20/2011 - 15:50 | 1896190 Stumpy
Stumpy's picture

That video was so "understandable", even for a foreign language speaker. No hesitation. Short sentences. Clear ideas.

Sun, 11/20/2011 - 15:00 | 1896045 Joebloinvestor
Joebloinvestor's picture

Get the Vatican to buy them. They deserve it.

Sun, 11/20/2011 - 16:58 | 1896373 junkyardjack
junkyardjack's picture

Good luck getting a dollar out of their collection plate

Sun, 11/20/2011 - 15:04 | 1896050 Dismal Scientist
Dismal Scientist's picture

 

 

Reality break: ZH readers are too parochial...

"There is a clear disconnect between what fund managers think / believe, and what is happening on German streets.

The real world (German voters) has, in general, not the slightest concern when it comes down to the "Euro". Nice theme on TV, but does not exist in your daily life.

"Take the city state of Berlin. The city has more debt than Argentina (over EUR 60bn). But the new SPD-CDU Berlin coalition government has just agreed to employ another 11.000 civil servants, and has come up with all sorts of welfare state goodies for voters... No sign of "austerity"... There are only 12 companies in Berlin that employ more than 500 employees... Unlike Argentina, Berlin has no underlying business model, except tourism (exactly like Greece)...

"A tiny portion of Germans try to copycat the "occupy"-movement, but these guys are organized by the usual left-wing suspects (Greenpeace, Green Party, attack movement, etc.) which do know how to exploit anti-market, anti-capitalistic sentiment in Germany (certainly prevailing for a long period of time). "Lehman" 2008 simply re-confirmed their views.

"However, one aspect of the drama has become very apparent: the politicians have successfully managed to blame the "banks" in total for all the ongoing trouble. "Bad governance" by German / European governments regarding fiscal policies is not discussed. The "banks" have caused all of these problems... No one discusses the excessive, debt-driven welfare states (organized by generations of politicians) in Europe that have reached the limits of refinancing while their respective demographics are deteriorating.

"So, while a huge part of the Germans may not like the "Euro" (see many polls), the same huge part is not at all concerned about the stability of the currency and/or places like Italy. Debt de-leveraging can take many years. Therefore the name of the game in Europe / the Eurozone is and can only be "muddling through", given the number of countries and political decision-makers involved. There is no quick fix and everybody understands this.

"Also, all lip-service apart, when push comes to shove German politicians expect the ECB to jump in and buy sovereign bonds directly. The "options" are: temporarily higher inflation (good to reduce government debt and to expropriate savers) or a defunct financial system. Politicians, Bundesbank and the ECB will of course go for the former. Buying sovereign bonds directly, truly, will only happen in the very last "second", i.e. when the "virtual" crisis has become a "real" crisis (from a German perspective, since the country is booming economically & mentally).

When pain is felt, action will happen. Not before. Good luck.


 

Sun, 11/20/2011 - 15:12 | 1896080 JW n FL
JW n FL's picture

 

 

How dare YOU! Sir!! How dare You! speak against the History being written and recorded every day!

The People are Sheep! and the Sheep must be led and fed! for they can NOT! care for themselves!

History is being presented by those would seek to help the Sheep!

This is not just another greedy exercise.. wealth grabs are for the benefit of those charged with the responsibilities of the World!

They Deserve Your Hard Earned Work! You are not smart enough to know what to do with it in the first place!

Give unto them what is surely for your own good! think not of yourself but of the well being of your children! They only wish to protect you from your ignorant selves!

You Sir are living proof that no good deed goes un-punished!

You should bow and Thank them for what you have rendered to them!

 

Sun, 11/20/2011 - 15:20 | 1896107 Dismal Scientist
Dismal Scientist's picture

Hhmm. The sheep are being herded towards to the tax and inflation pens. They are happy and complicit, the bleating idiots. I know you understand.

Sun, 11/20/2011 - 15:25 | 1896118 magpie
magpie's picture

Slight fraying at the edges. Insurance Cos bleating about the low interest rates and then being able to tear up the contracts.  And discussion of the "Riester" subsidized pension scheme.

Sun, 11/20/2011 - 15:31 | 1896139 Manthong
Manthong's picture

Geez.. the next thing you know someone is going to say everything is not wonderful in China.

Sun, 11/20/2011 - 15:18 | 1896100 topcallingtroll
topcallingtroll's picture

I suspect the pain is coming in the next few months.
Expect a slow grind down for gold until I decide to sell.

Aint selling yet.

Sun, 11/20/2011 - 15:26 | 1896120 Dismal Scientist
Dismal Scientist's picture

Pain is here for those in the front line. Sheeple are going to be shorn. Again, and again, and again. When you hear taxi drivers say 'what u fink about gold', then double up. The pain has not started yet.

Sun, 11/20/2011 - 15:46 | 1896183 Bansters-in-my-...
Bansters-in-my- feces's picture

So are you waiting for the price to drop before you sell...out.?

Sun, 11/20/2011 - 15:33 | 1896144 GeneMarchbanks
GeneMarchbanks's picture

'Reality break: ZH readers are too parochial...'

Kind of. Although... the majority of readership is US so maybe it reflects the recent polarization.

'When pain is felt, action will happen. Not before. Good luck.'

Define pain?

Sun, 11/20/2011 - 15:40 | 1896167 Dismal Scientist
Dismal Scientist's picture

When gubbmint handout + family handout runs out. Thats just the liquidity part

As a European, the pain is still ignored. Germans hear it every day that they 'may ' have to pay for the rest of Europe. Its not felt in their wallet yet.

Sun, 11/20/2011 - 15:57 | 1896219 GeneMarchbanks
GeneMarchbanks's picture

So... I'm not sure how that 1920s episode in Germany has impacted the modern day economic outlook of citizens but something tells me 10-15% inflation would spook many. No?

Sun, 11/20/2011 - 16:07 | 1896238 Ghordius
Ghordius's picture

Some, yes. But not necessarily that much.
Their typical investment mix is different.

I agree with DS, the handout is more relevant.

Sun, 11/20/2011 - 15:05 | 1896060 JW n FL
JW n FL's picture

 

 

The EFSF: expensive, inefficient and limited - but maybe a blessing in disguise!

Harry Huizinga
Interviewed by Viv Davies
18 November 2011

 

Harry Huizinga talks to Viv Davies about his recent paper on the EFSF. Huizinga concludes that the creation of the EFSF has resulted in the bail out of both banks and countries, that the use of EFSF funds has been expensive and inefficient, and that there is a limit to the extent to which the EFSF can be scaled up. Nevertheless, he suggests that this may be a blessing in disguise. The interview was recorded on 17 November 2012.

Listen (11 minutes 53 seconds) Download
(MP3 file 10.9MB)

Download "Does the European Financial Stability Facility bail out sovereigns or banks? An event study", CEPR Discussion Paper No. 8661, free of charge here.

http://www.voxeu.org/index.php?q=node/7293

We must maintain order to maintain Wealth! and You! Sheep!! will line up OR! the Nazi Police will be loosed upon You and Your Loved Ones! We are forever gving You! Sheep!! Something! and You! ALWAYS COMPLAIN ABOUT IT!! Know Your Place! or We will remind You! of it!

 

 

Sun, 11/20/2011 - 15:07 | 1896064 css1971
css1971's picture

"The time to buy is when there's blood in the streets."

We're getting there.

 

Sun, 11/20/2011 - 15:17 | 1896094 JW n FL
JW n FL's picture

 

 

http://www.youtube.com/watch?v=cZ2SaAIF4B4

You can buy real estate in Egypt.. some of the Gold Money Guys already went in on some apartment building with frontage on Tahrir Square.. I guess they bought early.. given the Military ouster in process..

The more the Military Kill the More People will Join.. it is a self feeding machine of change.

and if you think it is NOT coming to America?!

never mind.. we all lie to ourselves in one way or another for comfort.. why would I want to drag you from your little world into the light of truth.. it is sooooo fucking blinding!

Sun, 11/20/2011 - 15:12 | 1896082 topcallingtroll
topcallingtroll's picture

I have been telling you goldbuggers for as long as I can remember that germany will not allow monetization.

Every rumor is swiftly denounced by german officials.

German officials are unanimous that there will be no monetization.

I did not realize until a week ago the extent that the market has discounted monetization. Now the market is pulling its ass out of its head and not liking what it sees.

Sun, 11/20/2011 - 17:47 | 1896493 Ghordius
Ghordius's picture

;-)
Define "allow"

Sun, 11/20/2011 - 15:20 | 1896105 Triple A
Triple A's picture

like Martin Armstrong and many others say get out of ALL GOVERNMENT BONDS. Way too much debt in the world.

Sun, 11/20/2011 - 15:23 | 1896109 Long-John-Silver
Long-John-Silver's picture

Rome was not built in a day, nor did it fall in a day. It is on the verge of another collapse that comes like a thief in the night. We will awaken one morning having no clue it fell again while we slept in our beds.

Sun, 11/20/2011 - 15:26 | 1896119 Caviar Emptor
Caviar Emptor's picture

We need "Trickle Up Economics" to compensate for 30 years of "Trickle Down Economics". 

How? Simple. One central global bank Hoovering up all the debt of the globe. All of it.

Private, corporate, sovereign...it don't matter. Just suck it up undiscounted and re-issue in CDO form post-devaluation under a new global currency...The Esperanto! Pegged to the price of crude. Voila!!

That was easy

Sun, 11/20/2011 - 15:31 | 1896140 HD
HD's picture

I like it. It could be the - Buzz Lightyear Bailout Bank..."To infinity and beyond"!

Sun, 11/20/2011 - 15:55 | 1896213 Caviar Emptor
Caviar Emptor's picture

I should have said pegged inversely to crude so that scarcity forces buying power down

Sun, 11/20/2011 - 15:27 | 1896125 Omen IV
Omen IV's picture

maybe someone could explain this for my edification?   why are the italian banks and goverment buying the debt back?

why wouldn't they do absolutely nothing let the value drift down and then have the government not pay the interest due at say December 31 -  declare  the new currency  - the Lira - and buy back the bonds at 25% of par or exchange for 30 year bonds at a nominal interest rate in Lira with the equivalent value and cut their debt load for the next century.

the bonds go into default -  the CDS are activated - put back and they go back to the major insurance cos and ultimately circle back to the US banks who are the issuers of the insurance and then the fed monitizes with a reserve currency and therefore the bonds become  US assets - why spend local country assets  / purchasing power at this particular point?

Sun, 11/20/2011 - 16:12 | 1896257 Ghordius
Ghordius's picture

Perhaps because they are Italians?
They still believe, like me, that in a decade long problem there is room for solutions. Not much, though...

Sun, 11/20/2011 - 15:28 | 1896128 HD
HD's picture

This is the gonna be the best non Bruce Willis related Armageddon ever!

Sun, 11/20/2011 - 15:35 | 1896136 Franken_Stein
Franken_Stein's picture

If only the collapse was already there, but it isn't, even as Tyler is promising it to us every other day.

Where is that fucking collapse that was promised to us ?

I wake up every day, I read the newspaper, I listen to the radio.

 

No collapse.

 

I watch the people on the streets of Germany,

I want to shout out to them:  There is a collapse coming your way !

Hurry !

Protect your money, your assets !

Yet, I would certainly sound hysterical and silly in that crowd of totally uninterested, relaxed passers-by.

They'd laugh at me and ridicule me if I told them that their money, their bank accounts, their pensions, their life-insurances are all in danger of becoming worth nil !

 

But nobody here reads Zerohedge, nobody is informed, I'm surrounded by sheeple, grazing on their pasture.

 

Baaaah !

Sun, 11/20/2011 - 15:36 | 1896150 HD
HD's picture

The time for such hubris was when the Fed was backstopping the world.

Sun, 11/20/2011 - 15:51 | 1896194 wandstrasse
wandstrasse's picture

bist nicht ganz allein... auch ich sitze auf ein paar Silbermünzen und wähle mich hier ein so oft es geht. Ich lese endlich the creature from Jekyll Island, höre Depri-Musik, und kann immer noch nicht fassen wie quasi die ganze Weltbevölkerung von ein paar Bankern seit Jahrzehnten nach STrich und Faden verarscht wird...

Sun, 11/20/2011 - 16:05 | 1896241 Caviar Emptor
Caviar Emptor's picture

TPTB want a decline, a controlled-collapse that favors them as they grab what's left and watch the world melt down around them. The collapse would have happened in 08-09 without the massive bailouts. But that would have meant that the debts owed to TPTB would have defaulted, the failed corporations and banks would have foundered and new competition would have had a chance to break in to the game. And that will simply not be allowed. The proceeds from the bailouts will pay for the jackbooted security forces, riot gear, tear gas, and bug out ranches. 

Sun, 11/20/2011 - 16:13 | 1896258 css1971
css1971's picture

Sloooooooow. There are processes to be gone through, forms to be filled.

Give your friends and relatives a silver coin for christmas.

Sun, 11/20/2011 - 15:33 | 1896146 Eireann go Brach
Eireann go Brach's picture

Cue Bon Jovi singing "Living on a Prayer" in Italian!..how do you say that in Italian anyone?

Sun, 11/20/2011 - 18:12 | 1896550 Schmuck Raker
Schmuck Raker's picture

In any language it's: 'crap'.

Sun, 11/20/2011 - 15:35 | 1896149 I am Jobe
I am Jobe's picture

Silent Peasants.

Sun, 11/20/2011 - 15:42 | 1896171 Franken_Stein
Franken_Stein's picture

I mean you can't announce a collapse every other day and then you don't deliver.

That's alarmist at best and hysterical at worst.

 

Say it once when you are really certain about the imminence of the collapse, and people will trust you.

But if you announce it too often, people will just turn their backs on you and call you a nutjob and go about their daily business, never listening to you again.

Sun, 11/20/2011 - 15:50 | 1896191 magpie
magpie's picture

Even with the "absence" of imminent doom, it is still wise to stick around and discover the nature of the collapse.

There is a certain variety. Maybe it was the quicksand kind all along.

Sun, 11/20/2011 - 16:27 | 1896297 css1971
css1971's picture

You should have a word with some Greeks.

Germany will be the last place in Europe to fall. You have some time yet.

By this I mean, it already started.

Sun, 11/20/2011 - 21:06 | 1897128 HD
HD's picture

One wonders if the same standards apply to CNBC and the like that declare "recovery"and "buying opportunity" on a daily basis. Odd how in a market crushed by debt, default and completely depended on massive intervention - the only acceptable outcome is "bullish"...

Sun, 11/20/2011 - 15:47 | 1896187 Franken_Stein
Franken_Stein's picture

There was a woman in Greek mythology, her name was Cassandra.

She was able to anticipate future hardship and mishap, but she couldn't warn anyone who'd be affected.

That was a gift and a punishment at the same time, handed to her by the Gods of Olymp, as far as I know.

Sun, 11/20/2011 - 17:09 | 1896409 Blank Reg
Blank Reg's picture

Apollo.

Sun, 11/20/2011 - 16:20 | 1896276 BW
BW's picture

As the ECB keeps buying day after day, apparently against Germany's wishes.  Yea, Okay.

Sun, 11/20/2011 - 17:19 | 1896432 AndrewCostello
AndrewCostello's picture

Forcing the future tax payers of the world to buy all these bonds is just outright theft.  The whole world is a disgrace with everybody spending more than they earn.  We need to go back to an honest, gold backed system of finance and money.

 

Read:

http://www.amazon.com/Simple-Wealth-Mr-Andrew-Costello/dp/1463523017/ref

Sun, 11/20/2011 - 17:40 | 1896477 catch edge ghost
catch edge ghost's picture

Here there be Dragons!

Put in your thumb, pull out a plumb.

Sun, 11/20/2011 - 18:22 | 1896579 RamonLlull
RamonLlull's picture

Police now using under-cover agents provocateur at Occupy London demonstrations:

http://www.youtube.com/watch?feature=player_embedded&v=BJ5BM6NV1y8

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