Dexia Nationalization Imminent?

Tyler Durden's picture

Back on Friday, when we closed out the Dexia long sub CDS trade, we said "We expect a partial or complete nationalization to be announced imminently, which in addition to all other side effects, would lead in a Bear Stearnsing of all accrued profit." Sure enough, here is the Sunday Times on the very topic... And while a nationalization of Dexia, which now appears a matter of hours if not days, will be bad for anyone still long the bank's CDS (it should trade down to pari with Belgium tomorrow, just as Bear CDS trades in line with JPM), it is pretty horrifying for SovX and Eurocore CDS in general, now that a bank which holds assets amounting to 180% of Belgium's GDP, is about to be nationalized by the very same country. Anyone who is still not long Belgium CDS, this is probably your last chance to get on that particular train. Of course, if one is waiting patiently in line at a Dexia ATM machine, one is forgiven.

Source: Sunday Times.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
TradingJoe's picture

Hah, by 9:30 Monday morning it'll all be good :()))))))
We all know how this is going to end...?! JPM got WM and BS, I wonder who's gonna get what's left and still valuable of Dexia?!?!?
And so on with the rest of the "stress tested" UTTERLY BROKE "financial institutions", :()))))!

gangland's picture

excerpting suskind's new book here until i cant

MisterMousePotato's picture

Isn't Belgium currently without a government now for about a year? Just who, then, is supposed to 'nationalize' Dexia?

Racer's picture

Futures soar on this amazingly.. bad or is it good .... news ... who cares... soar futures, it is the middle of the night and that's what always happens, so GO....BUY  BUY BUY

edit: wow... wish I had bought the futures on that comment instead of commenting LOL! But get involved in trading this farce of a 'market' ... no... what's the point, it is all a big CON

Cliff Claven Cheers's picture

The EUR is trading up as we speak. Must not be that big of deal.

CapitalistRock's picture

Bank nationalizations imply printed money to keep them solvent, hence assets will tend to rise as fiat currency holders will tend to take it up the ass again.

disabledvet's picture

Yeessssss. That's what Ms. Pillsbury told me after depositing the "cool 240 million."

With those exact words even! Who knew she could use such....VULGARITIES!

(It's very exciting really...

hondamikesd's picture

My international finance professor asked the class why Belgium was involved in BIS talks, as he didn't know of any largish banks in Belgium. I suggested Dexia, at which point he gave me a quizzical look and stated, "never heard of them".

I feel that that situation will be rectified soon :).

CapitalistRock's picture

You did say he is a professor, correct?

hondamikesd's picture

Yeah, legal prof. Used to do intl. securities law out of HK and London before "retiring" to academia a few years ago. I was somewhat suprised but he gets a small pass for being "back office" 

Edward Fiatski's picture

Ho Ho Ho. I visited a Dexia bank branch when I was passing thru Belgium, Veurne - small town, great architecture. I hope the guy that helped me out there finds decent work for himself post facto.

chump666's picture

F*cking bearish.  Stocks got like three days of rallies, that's it.  EU/banks/Greece/Turmoil/Credit/liquidity crunch + China crash now happening in real tim = major selling.

 If a European bank is bailed out within the above unfolding FUBAR, liquidation trade will be back on...full force.

Yen Cross's picture

F...king +1. Chump 666! That euro gap was a gimmee! Keep it ( EFFERVESant) ...    SP/ intended!  You are a good poster!



chump666's picture

 Thanks.  I gotta eat too y'know!

Thinking 3days of selling (start week) on US/EZ markets, Asia will be down most of the week.  So you should have some nice gap down trades going on.  And that is gap down on major indexes and risk trades (FX - except the AUD hahaha...till the Aussie housing markets implode!)

Fips_OnTheSpot's picture

Yet another "trigger event"?

ISEEIT's picture


My motto.


Fade. Always Fade.........

It's what you do this week.


DoChenRollingBearing's picture

Sudden Debt, where aRE YOU BUDDY?

Sudden Debt's picture

My company has been taken over and I need to suck up to the new boss so I haven't had that much time to visit ZH these last weeks :)

I do follow up my friend :)




Everybody focusses a bit to much on just Dexia. KBC is in the same kind of shit.

And thus we are ready to lose 4X GDP and more on those 2 banks like predicted months ago.

The government is also still liable for the saving accounts of the citizens for up to 250K per person.

X 7

There's also a massive bank run happening on Dexia because almost everybody knows that they should run from it.


agrotera's picture

Stephen King is HSBC's chief economist twin to his brother Stephen 1 ? famous novilist-- they both have a common job, tell tales of horror except in Stephen 2's case, his horror stories are all sweet smelling garbage packaged as reality. 

disabledvet's picture

trust me "i've had the voice over." it wasn't cool then and now that the facts back me up...actually it's kind of cool now--in a Freddy Kreuger kinda way.

Tsar Pointless's picture

I am shocked at the number of people - otherwise sensible, rational people - who continue to hold the belief that the stock market should always reflect reality.

That's not possible, because reality doesn't even reflect real reality.

For realz, bitchez!

buzzsaw99's picture


r101958's picture

Time for the usual Monday morning melt up.

lolmao500's picture

Anyone who is still not long Belgium CDS, this is probably your last chance to get on that particular train.


And how do we do that?

achmachat's picture

if you owe Dexia half a million Euros, and they get nationalized, is that a
- good thing?
- bad thing?
- won't affect me?

BurningFuld's picture

Damn. My money was on UBS. But it's not official yet right. So I still have a chance.

rambler6421's picture

Precious Metals Bitchez!

ratso's picture

Don't be s sure that much if anything of value will be left of Dexia.

tom a taxpayer's picture

Katie bar the door!

hondamikesd's picture

O/T but: anybody buy from these guys/know where I can get a similar product?

I really like the hand poured look, it'd be perfect for my office.

hondamikesd's picture

+1, thanks! Those are lovely, though a 1,000 oz.'er might have to wait until after my copper puts come through :)

traderjoe's picture

I would never order from nwt mint again.

hondamikesd's picture

I haven't used them. Bad experience?

ziggy59's picture


beautiful hand poured bars 1 oz. and up.. comparative prices and great service imo.

hondamikesd's picture

+1 Thanks Ziggy, those look damn good as well!

Seasmoke's picture

did business in USA last year with a Belgium corporation who was in receivership.....they couldnt make a decision without it going thru so much red tape , nothing ever got completed....the ceo of american operation left in early spring as the writing was on the wall .........all of Belgium is a financial ticking time bomb