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Did The Fed Quietly Bail Out A Bank On Tuesday?

Tyler Durden's picture


Over the past month we have been closely documenting a major funding squeeze in the all important shadow economy - the "synthetic liquidity" conduit which far more than traditional sources of cash, has become all important for proper bank functioning over the past decade. Courtesy of adverse development in Europe, one by one various components of this unregulated funding scheme have become frozen necessitating the first of many central bank interventions on November 30 to provide liquidity to global banks, primarily to offset such shadow conduits as locked up commercial paper, repo and money markets. Logically, as noted over a week ago, European banks scrambled to obtain cheap dollars by borrowing over $50 billion from the Fed, and plug dollar shortfalls. Yet as all band aid measures designed to offset a broken liquidity equilibrium fail eventually, it was only a matter of time before we saw a direct bail out by the Fed of one or more banks in the aftermath of the November 30 global "bail out." Sure enough, we have our first clue that "something" happened in the week ending Wednesday December 14 that involved an upgrade of the Fed's indirect (and thus untargeted) bailout of global banks, to a focused, and very much targeted rescue of one (or more) banks. And with some additional diligence, it may be possible to narrow down the date of an actual bank bailout: Tuesday, December 13.

Exhibit A - Reserve Bank Credit

Two years ago, when discussing the transition of the world to one coordinated, centrally-planned regime we said that the only financial statement of any importance, updated weekly, is the Fed's H.4.1, or the "Factors Affecting Reserve Balances" which traces that flow of "last resort" cash from the Fed to the various organization that make up the reserve bank, primary dealer, and various other financial entities under the Fed's Lender of Last Resort umbrella. Simply said, anything abnormal in this weekly report of "flow and stock" (a simplistic distinction where the Fed is far more focused on what the absolute level of reserve numbers is, whereas Zero Hedge and the market believe it is the "flow", or marginal change, that determines, artificially, asset prices) would confirm our speculations that the Fed has stepped into into its now traditional role of bailing out the world.

The first thing that caught our attention was the all important total reserve bank credit - the most important big picture metric announced by the Fed on a weekly basis. As the chart below shows, after having plateaued with the End of QE2, and remaining stable during the duration of the "sterilized" Operation Twist (as it should), in the week ended December 14, total reserve credit soared by a whopping $81 billion or the most since May 27, 2009 when the Fed was actively undergoing the early stages of QE1 damage control.

So what was the reason for this huge jump in reserve credit? Two things - on one hand we had the already long-ago telegraphed increase in Fed liquidity swap lines by over $50 billion, or from $2.3 to $54.3 billion to be exact. However that does not explain the remainder. So where did the other $30 billion in credit expansion come from?

Exhibit B - The Plot Thickens: First Net MBS Bulk Purchase Since QE1

It appears that in addition to reverting to such an "old school" QE1 global bailout mechanism as FX swap lines, the Fed also did something it had not done in a long time, or since QE1 to be exact: it bought a boatload of Mortgage Backed Securities, an act it last engaged in on a net basis back on August 11, 2010, which in turn was a delayed settlement of an earlier purchase. As a reminder, the Fed's balance sheet settles any MBS purchases on the mid-month update so while the big spikes in the chart below between January and July 2010 are indicative of broad MBS purchases by the Fed under the auspices of QE1, when it was out purchasing a total of $1.25 trillion in MBS in hopes of lowering mortgage rates and stimulating housing, and thus employment (something it failed at miserably), in the mid-month week just ended, the Fed bought, and settled concurrently, an unprecedented $31 billion in MBS.

Obviously $31 billion jump in settled MBS purchases is notable considering the pattern of previous MBS net flows since August 2010. But under what auspices did the Fed go ahead and buy this whopping amount of Mortgage debt? And why?

As New York Fed itself tells us:

Agency MBS Tentative Purchase Amounts and Historical Operational Results


The Desk’s tentative agency MBS purchase amounts associated with the reinvestment of principal payments from agency debt and agency MBS in agency MBS are shown in the table below. The numbers listed are subject to change, should the Federal Open Market Committee (FOMC) choose to alter its guidance to the Open Market Trading Desk (the Desk) at the New York Fed during the monthly period or if market conditions warrant. The amounts listed are approximately equal to the amount of principal payments from agency debt and agency MBS expected to be received over the monthly period, adjusted for any variations from prior periods, as described more fully in the FAQs.


In addition, in order to ensure the transparency of its agency MBS transactions, the Desk will publish historical operational results, including information on the transaction prices in individual operations, at the end of each monthly period.

Specifically, in the period between December 13 and January 12, the Fed had permission to buy, wait for it, $30 billion.

And yet, there is a discrepancy as in a subpage detailing gross and net purchases the Fed reveals only $7.550 billion in net MBS purchases for the week ended December 14.

So obviously while the temporal matching is still not precisely clear, what is clear is that in the week ended Wednesday, The Fed provided a whopping $81 billion in additional reserve credit between FX swaps and MBS purchases, the latter having no other purpose than to release even more liquidity to banks which have simply converted one illiquid security, into another: cash. This answers the important question of "why" the Fed did what it did. It is also unclear whether this outlier transaction was demand driven or forced by the Fed. All that will be confirmed once we get the official breakdown of MBS POMO on January 13. Incidentally, here is what typical MBS purchases and sales look like on a monthly basis (excel table).

While these two balance sheet outliers would have in themselves made for curious observations, if insufficient to draw any particular conclusions, it is Exhibit C that puts things into perspective.

Exhibit C - Average Discount Window Borrowings

When the Fed updates its H.4.1 every Thursday at 4:30 pm, it provides two sets of data: an average over the period, and a period end number. And if one was looking to find a flashing red light within Bernanke's book, which has always without fail been a big change in Discount Window borrowings (either Primary, Secondary or Seasonal Facility), looking at the period end number would have shown nothing out of the ordinary: there was a modest $42 million borrowed from the Primary Credit Discount Window facility on the day ending December 14, Wednesday, far less than previous 2011 outliers. However, things rapidly change when one observes the average usage of the Discount Window for the past week.

The result is as follows: a $393 million surge in average borrowings:

And since we know that of the 7 days that make up the average period, one can be eliminated (as there was no borrowings on Wednesday), the implication is that on one day in the week ended December 14, the Fed lent out up to a whopping $2.5 billion (as the $393mm is an average 6 day number) to a bank in the form of last recourse cash via the Discount Window.

Confirming just this speculation is Barclays' Joseph Abate:

After months of virtually no use of the Fed’s discount window, borrowing jumped to an average of $400m/day in the week through Wednesday. The Fed reports only the weekly average of daily borrowing and the daily amount outstanding on Wednesday. From these figures, we estimate that on one day last week, total discount window borrowing reached $2.5bn. Of course, the same $400m/day weekly average could have been achieved with a bank borrowing $900mn on Friday. It is unclear what prompted this pick-up in borrowing from the Fed. There was neither a spike in the fed funds rate nor any disruption in the repo market, so we are a bit puzzled. Of course, under Dodd-Frank, the borrowing bank’s name will be released – after two years.

Yes, the name of the bank that received what amounts to a Fed bailout will be released in two years, but no, we disagree that there was no disruption in the Repo Market. Perhaps Joseph forgets that the Fed lends out Discount Window cash to "eligible" entities out of Europe... where the repo market is in total collapse and wholesale disarray.

Furthermore, the borrowing was from the Primary Credit facility, or that reserved for stable banks, not Secondary Facility eligible names which have to pay an addition 50 bps in punitive interest. And since the bulk of Primary Credit eligible banks domestically already are swimming in $1.6 trillion in fungible excess reserves (which is the reason why discount window borrowings have been so modest ever since QE1 unleashed a liquidity tsunami for the bank, which serves no other reason than to plug capital shortfalls - it certainly is not being lent out) it is obvious that the Fed is now back to its old job of bailing out banks. And not just any banks - European banks.

Some appropriate reminders from the Fed on the "lender of last resort" discount window use:

Terms & Features
To access the Discount Window, eligible depository institutions first must execute the necessary documentation and pledge collateral to the Federal Reserve.

Primary Credit
Secondary Credit
Above the FOMC's target for the federal funds rate. Primary credit rate plus 50 basis points

Overnight Short-term, usually overnight. Can be extended for a longer term if such credit would facilitate a timely return to reliance on market funding or an orderly resolution of a failing institution, subject to statutory requirements (FDICIA restrictions).

Depository institutions in generally sound financial condition; same as eligibility for daylight credit. Depository institutions that do not qualify for primary credit.

Generally no restrictions.
May be used to fund sales of federal funds.
As a backup source of funding on a very short-term basis, or to facilitate an orderly resolution of serious financial difficulties.

Ordinarily no questions asked. Reserve Banks will collect information necessary to confirm that borrowing is consistent with regulatory requirements.

Depository institutions to which the law grants access to the Discount Window and which the Federal Reserve deems generally sound are eligible to obtain primary credit. Reserve Banks determine eligibility on an ongoing basis using supervisory ratings and capitalization data; supplementary information, when available, may also be used.

Examination Rating
(CAMELS or equivalent)
Eligible for
1, 2, or 3
Adequately or well capitalized
Primary credit

4 or 5
Secondary credit

Less than adequately capitalized
Secondary credit

Common Borrowing Situations
The new Discount Window programs offer an enhanced opportunity for eligible depository institutions seeking an efficient solution to meet unexpected, short- term funding needs.

Likely Situations for Borrowing Primary Credit

Generally, there are no restrictions on borrowers’ use of primary credit. Here are some examples of common borrowing situations:

  • Tight money markets or undue market volatility
  • Preventing an overnight overdraft
  • Meeting a need for backup funding, including a short-term liquidity demand that may arise from unexpected deposit withdrawals or a spike in loan demand
  • Arbitrage opportunities



We know two things with certainty: In the week ended December 13 (14th excluded) one or more banks, most likely European, borrowed up to $2.5 billion from the Fed's Primary Credit Discount Window. And since US banks are drowning in dollar-based liquidity, any need to approach the Discount Window now, in the context of trillions of Excess Reserves, carries with its exponentially greater stigmata than it ever did during Lehman days. Also, in the week ended December 14, the Fed did a mid-month settlement of $31 billion in MBS purchases - a transaction which allowed a Primary Dealer to source critical liquidity, based on $30 billion in buyback authorization granted for the period beginning December 13. What we do not know for fact is whether the $30 billion in MBS purchases was completed on Tursday or Wednesday, and whether this is a delayed settlement for previous purchases, although due to the mid-month settlement process, it is possible that any transaction could have settled immediately. And for those seeking a specific "bank bailout" date, the 13th looks quite reasonable: it was the first day when an MBS purchase was permitted and it was the last day when a bulk Discount Window loan could have been performed.

But wouldn't the market learn of even a hushed European bailout? And wouldn't there be a massive sell off if it became clear that exactly two weeks after the Fed's coordinated broad bailout of European banks, it had to engage in another, far more politically tenuous bailout, this time via a $2.5 billion free money loan to a cash scrambling bank? Well, if the news was leaked at 2pm on Tuesday it sure would explain the market reaction...

So while much of the presented above is circumstantial, perhaps the next time Congress is debating with Ben Bernanke just how good it is for the US taxpayers to bail out European banks, someone can ask him just who it was that the Fed once again bailed out the week of December 14. Because America obviously does not have enough problems of its own...


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Sat, 12/17/2011 - 13:14 | 1989841 CalibratedConfidence
Sat, 12/17/2011 - 13:14 | 1989884 The Big Ching-aso
The Big Ching-aso's picture



If it was Tuesday the Fed must be bailing out Belgium?

Sat, 12/17/2011 - 13:26 | 1989907 Comay Mierda
Comay Mierda's picture

ZH is amazing.  The fed cant wait for the SOPA bill to pass to censor this website, though.  ZHers, enjoy it while you can

Sat, 12/17/2011 - 13:41 | 1989935 Fish Gone Bad
Fish Gone Bad's picture

I could not figure out why banks had stopped failing for the last few weeks (, maybe the Fed was bailing out banks.

Sat, 12/17/2011 - 13:45 | 1989944 Comay Mierda
Comay Mierda's picture

bank bailout whack-a-mole until after consumermas is over

Sat, 12/17/2011 - 13:56 | 1989963 lotsoffun
lotsoffun's picture

yes - we have to make it to the next year.  at that point, anything is anybodys gues.  anybody want to guess why?

(hint- hint - the banker bonuses even though they may be limited.  and within that, it will be limited for the little guys, but lloyd, jamie and there closest buddies won't take a penny hit, they will be up).



Sat, 12/17/2011 - 15:16 | 1990115 redpill
redpill's picture

Based on how long it took to find out about the first round of bailouts, I'd say we should know who got bailed out here by 2015.

Sat, 12/17/2011 - 17:59 | 1990340 Mauibrad
Mauibrad's picture

Check it out Tyler, officially a new word, de-hypothecation

Sat, 12/17/2011 - 22:30 | 1990626 redpill
redpill's picture


How does the Gandhi quote go?  "First they ignore you, then they laugh at you, then they fight you, then you win."

Well the Republican establishment candidates and the media are done trying to ignore Ron Paul, they've tried and failed to laugh at him as his support has grown.  Now the long knives are coming out, and in the last days before the Iowa caucus they are trying to fight him.

Please help with the Ron Paul Money Bomb this weekend, - they are very close to their goal, even a measly $10 will be a help (which won't be worth $10 for long with the all the Federal Reserve is doing, so hurry!).

The bad news is that the smears and mischaracterizations are likely to continue from here on out.  It's official, Ron Paul is a THREAT.

The good news is the last part of that Gandhi quote.  Here's to Ron Paul's victory on January 3rd in Iowa!


Sat, 12/17/2011 - 23:56 | 1990702 wisefool
wisefool's picture

You cant make this stuff up folks. Newt is the type of guy at the stage of oppulence in his life that he bragged in the last debate about "training 1 and 2 star generals" Ron Paul got drafted. If there are any generals who run around with pantywaist Newt as a mentor I am going to stick my ...

Sun, 12/18/2011 - 02:19 | 1990848 AldousHuxley
AldousHuxley's picture

Newt family values = upgrade your wife when whe gets old


BAC about to hit $5 again for the 3rd time in 3 months.





Sun, 12/18/2011 - 11:14 | 1991383 saiybat
saiybat's picture

Here's what Newt thinks about family values


"A new civilization is emerging in our lives, and blind men everywhere are trying to suppress it. This new civilization brings with it new family styles, changed ways...a new economy, new political conflicts, and...altered consciousness... Humanity faces a quantum leap forward. This is the meaning of the Third Wave…

Our argument is based on what we call the “revolutionary premise”... The revolutionary premise liberates our intellect and will.

Nationalism is...First Wave. The globalization of business and finance required by advancing Third Wave economies routinely punctures the national “sovereignty” the nationalists hold so dear...

As economies are transformed by the Third Wave, they are compelled to surrender part of their sovereignty... Poets and intellectuals of Third Wave states sing the virtues of a “borderless” world and “planetary consciousness.”

The Third Wave...demassifies culture, values, and morality... There are more diverse religious belief systems.

The Constitution of the United States needs to be reconsidered and create a whole new structure of government... Building a Third Wave civilization on the wreckage of Second Wave institutions involves the design of new, more appropriate political structures... The system that served us so well must, in its turn, die and be replaced."

- Newt Gingrich

Sun, 12/18/2011 - 12:07 | 1991489 falak pema
falak pema's picture

so there is a grand plan called the third wave... I hope its not coming from Fukushima!

Demassifying value systems, making them diffuse, but not polluting them to extinction, would be a blessing in itself.

I wonder what is the beef behind the hype.

Sun, 12/18/2011 - 01:26 | 1990777 aerojet
aerojet's picture

Even if Mr. Paul manages to beat the odds and get elected, it is 10 years too late to do anything useful about the problem. 

Sun, 12/18/2011 - 01:43 | 1990790 UP Forester
UP Forester's picture

If there's someone that can pull the yoke and keep the 747 from nosing straight into the ground, it's Dr. Paul the elder.


Sure would be a lot easier to clean up and rebuild from a belly-landing than a big smoking hole.

Sun, 12/18/2011 - 02:23 | 1990856 AldousHuxley
AldousHuxley's picture

Ron Paul's weakness as a politician is that he tells the truth....


bunch of undereducated Americans can't handle the truth and the elites will use this to stay in power.


some reason, short politicians seem to be the smartest because they get voted into power due to policy or brains rather than looks or rhetoric.



Sun, 12/18/2011 - 02:55 | 1990901 UP Forester
UP Forester's picture

Truth hurts.

But then again, so does getting clubbed in the head and drug off to a FEMA camp.

Sun, 12/18/2011 - 02:42 | 1990882 thegr8whorebabylon
thegr8whorebabylon's picture

10 years too late?  bullshit.  RP wins we get to live.

Sun, 12/18/2011 - 03:58 | 1990955 Heyoka Bianco
Heyoka Bianco's picture

"First they ignore you, then they laugh at you, then they fight you, then you win." That career path also applies to Hitler, you know.


Ron Paul is hardly a real threat, and he sure as hell ain't a real answer. He does give a good vewrbal handjob, especially to the young and asocial males, I'll grant him that.


Why don't all you "libertarian" ZHerrs just admit it: you want a king, a star to follow, a "benevolent" dictator to take away that nasty world out there of people who MIGHT HAVE DIFFERENT IDEAS! Extermionete! Exterminate!

Sun, 12/18/2011 - 04:46 | 1991001 OldPhart
OldPhart's picture

Heyoka Bianco member two weeks, two days.

Following the Constitution is not "wishing for a king" nor do we want any sort of dictator...we have one already in the form of Congress and the President.

As to those with different ideas, they are welcome as long as the ideas conform to the Constitutional basis that underlie our country.  If not, fuck off.

There are many in government, as of a few days ago (if not decades earlier) that should be shot on sight as traitors to the american people.  Perhaps that what you mean by "Extermionete! (sic) Exterminate!".  Many of us agree.

Ron Paul IS a real threat to the powers that be and will probably be "exterminate"d by them if he captures the nomination.  Similar to Robert and John Kennedy.  I expect that his nomination, after votes, will be denied by the Republican party and one of the other cookie cutter drones will be named instead.


Tue, 12/20/2011 - 11:43 | 1997628 mick_richfield
mick_richfield's picture

How does the Gandhi quote go?

It goes like this:

All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident

Arthur Schopenhauer

Sat, 12/17/2011 - 17:24 | 1990306 Michael
Michael's picture

I'd like to see our overlords reaction knowing the impact of credibility and name recognition this encounter gives Dr Ron Paul.

Dr Ron Paul Joe Rogan Man Love Moment on Jay Leno Dec 16 2011


Sat, 12/17/2011 - 18:59 | 1990406 Careless Whisper
Careless Whisper's picture

The Joe Rogan endorsement is huge because it will get alot of men to take a look at Ron Paul's policies.

Sat, 12/17/2011 - 20:01 | 1990486 dizzyfingers
dizzyfingers's picture

I might have to vote for Ron Paul as antidote to the Kleptocrats being put foward by the republicans. And maybe move to Texas into the bargain. Eff Illinois.

Sat, 12/17/2011 - 21:23 | 1990572 Raskolnikoff
Raskolnikoff's picture

Both Perry and Gingrich have expressed the idea of holding the Fed accountable. Perry even brought up the word 'Treason' and the Fed in the same sentence. I like Ron Paul, but it seems the political winds are changing, as you can sugar coat the inflation stats, but many voters do the shopping for themselves, you can't fool them with the terms non-cor inflation and the incredibly shrinking boxes and packages of food as well as the lowering of the quality of food..., had a pop tart the other day...with just a splash of sugary icing and the crust tasted like cardboard...poptarts never tasted that good anyway, but they have become laughable shells of their former selves, as you know the company that is making them is skimping on the input ingrediants. The coming events will force many a politician to abandon the status quo and literally run for their political lives.

Sat, 12/17/2011 - 23:10 | 1990661 Teamtc321
Teamtc321's picture

A pop tart? Really..........

Sun, 12/18/2011 - 00:38 | 1990693 TruthInSunshine
TruthInSunshine's picture

Perry & especially Romney may talk the talk on opposing The Federal Reserve's destructive policies, but they'd never walk the walk.

While no one can predict the future, Ron Paul is the only one who has significant credibility when he claims that he'd actively oppose The Federal Reserve's ability to distort and break markets, and to debase the currency.

We're at a fundamental point in the history of what is our young nation:  We now have more Americans, even though it's still a very small percentage of the total population, waking up to fact that having a fractional reserve central bank that is literally unrestrained in its ability to create as much fiat as it desires and funnel that fiat to whatever entities it desires, at whatever interest rate it desires, effectively picking winners & losers and subsidizing specific economic actors at the direct harm (as everything is relative) of others, is a prescription for ruin. Americans that are awakening to these facts tend to not like this form of monetary central planning, and tend to believe that it's tainted by cronyism and nepotism (as the financial sector of the economy is given preference in all ways, all the time, over other sectors of the economy, and as their is deep capture of the individuals who set policy at The Federal Reserve by Wall Street).




Sun, 12/18/2011 - 01:59 | 1990816 Joseph Jones
Joseph Jones's picture

Does anyone need another reason than this to know that Romney is Satanic?  He appointed dual-citizen (Israel) Michael Chertoff as Chief of his foreign policy team.   

Sun, 12/18/2011 - 02:30 | 1990871 AldousHuxley
AldousHuxley's picture

Perry just doesn't pass the IQ test.


Romney is your typical greedy wall streeter


Gingerich is your hypocrite....."grand daddy of earmarks" "conservative"


Ron wall st. high IQ as Dr., real conservative......


but republican these days hate real conservatives because they depend on WAR mongering to profit.



Sun, 12/18/2011 - 02:57 | 1990905 Michael
Michael's picture

Yeah, but do they have anything like this working for them except Dr Paul?

Sun, 12/18/2011 - 03:09 | 1990922 Michael
Michael's picture

A complete and total economic collapse of 1/3rd of the world economy, Europe, is currently underway. The Eurozone is finished. It won't be long till the economic fallout engulfs the entire planet Including the USA that is already bankrupt. If you don't read Zero Hedge you probably didn't know this bit of current events trivia that's concerning more and more people. Current economic events is why people are flocking to the? Ron Paul camp. The bank buildings will survive and be recycled.

Sun, 12/18/2011 - 04:20 | 1990982 Michael
Michael's picture

Here's the Christmas card your government sent you this year.

Merry fucking Christmas!

Bradley Manning Defense Reveals Alter Ego Named ‘Breanna Manning’

Sat, 12/17/2011 - 23:31 | 1990683 delacroix
delacroix's picture

It's part of the conditioning program, to get people to  accept mediocrity, in all areas of life.

Sun, 12/18/2011 - 01:05 | 1990759 Calmyourself
Calmyourself's picture

I have seen many examples i nthe last 3 years it has been very noticeable i nthe last six months.  All corporations are doing it from food ingredients to poor service..

Sat, 12/17/2011 - 13:45 | 1989946 The Big Ching-aso
The Big Ching-aso's picture



I can tell you have an acute sense of smell for these sorts of things.

Sat, 12/17/2011 - 13:57 | 1989964 Quinvarius
Quinvarius's picture

They are printing so much money.  This PM pullback is laughable.  There are tons of dollars out there, but the banks will always need more and more of them.  This is so Weimar, it is ridiculous.

Sat, 12/17/2011 - 15:49 | 1990124 nope-1004
nope-1004's picture

They are printing SOOOO much money and currency debauchery is SOOOOO prevalent, manipulation of precious metals is REQUIRED.  Otherwise, reserve currency is done.

Anyone that thinks PM's are not manipulated is clueless.  Or, as Dave in Denver says, "Anyone who looks at this data and does not admit that the big market corrections we experience in gold and silver are the product of illegal manipulation is an idiot."  A must read:


Sat, 12/17/2011 - 19:10 | 1990423 Popo
Popo's picture

Which is why you should buy oil. They can smash gold... But oil is what scares the hell out of them.

Sat, 12/17/2011 - 20:05 | 1990492 dizzyfingers
dizzyfingers's picture

don't think it scares them. It's all one big happy family grinning and giving you the finger now matter which way the market or any commodity moves.

Sat, 12/17/2011 - 21:56 | 1990599 el Gallinazo
el Gallinazo's picture

You going physical oil?

Sun, 12/18/2011 - 00:05 | 1990717 Raymond Reason
Raymond Reason's picture

Anyone have any idea why the price of gasoline has dropped, but deisel hasn't changed much?

Sun, 12/18/2011 - 01:42 | 1990789 Prairie Fire
Prairie Fire's picture

Where are you? I'm in Alberta and it's the same here.

On the news it's a local disruption. I was in Saskatchewan 2 weeks ago and same thing.

Doesn't make sense.

Sun, 12/18/2011 - 02:54 | 1990899 thegr8whorebabylon
thegr8whorebabylon's picture

if deisel drops, heating oil falls, so wait for spring.

Sat, 12/17/2011 - 15:48 | 1990163 rocker
rocker's picture

JPMorgan has rented or bought a new vault this year for a reason.  Surely it is not stashing cash notes. Hmmmm.

Sat, 12/17/2011 - 17:38 | 1990297 TruthInSunshine
TruthInSunshine's picture

CONfidence Ponzi will run as long as until a certain % of the population becomes even the slightest bit awakened to how fiat currency is created, where it comes from and how it ultimately adversely impacts them and their standard of living and opportunity costs. This % doesn't necessarily need to be very high; if 10% or even 5% or so of the population essentially chose to opt out of the fractional reserve fiat currency game (see below as to how), this could be more than enough to cause critical problems for the fractional reserve banking scam & govermental confiscation schemes (U.S. citizens are really taxed at levels exceeding 90% when all fees, levels of taxations and inflation are taken into consideration). Moreover, if 5% became aware to the point that they chose to opt out, this would indicate a trend was underway whereby that % would soon be 15%, and 25%, and so forth (as the government tried to dig fire breaks, in what would then be a destined to fail bid to keep the Ponzi alive).

The last thing the fractional reserve central banks want is to have to fight alternate currencies, whether they're being used openly or underground, as this threatens their very existence, and also neuters their ability to affect the economy (if even only marginally) via monetary policy; this is why the Federal Reserve was given a monopoly on the creation and distribution of what is the only legal 'tender' for the payments of all debt, both public & private, via the use of Federal Reserve Notes (not dollars or greenbacks) having no inherent value other than a claim that the face value of the note will be honored by way of the full faith and credit clause; this is why barter is highly discouraged, why the wider spread the use of alternate (and real) money such as silver and gold coins is punished (and if the practice broadens enough, is always and inevitably made illegal, with confiscation likely); this is why the banking system as we now know it, with banks networked with the Federal Reserve, would completely collapse if Federal Reserve Notes had any significant competition, as no one would choose the DOZENS of layers of taxable events and transactional costs associated with using the monopoly fiat that is Federal Reserve Notes if they had any viable alternative; this is why Alan Greenspan wrote (prior to his time as an official and ultimately a Chairman of The non-Federal Reserve non-Bank) that gold was the ultimate enemy of the fractional reserve banking system, as its widespread use as currency would completely lay bare the confiscatory system of wealth robbing schemes, on many layers, that is a fractional reserve banking system, and why fractional reserve central bankers viewed gold with hostility, and would go to any lengths to ensure that it (or any other inherently valuable asset that could be used as alternate currency) would never be allowed to be supplant the use of Federal Reserve Notes; this is why central bankers do not highlight and grimace at open discussion of and attention paid to historical events whereby fiat was depegged from the gold standard, or events where any constraint on the ability of the  central bank to conjure fiat from thin air at no cost to it was done away with (events such as Bretton Woods, or, even more fundamentally, the 1910 meeting on Jekyll Island, Georgia, whereby the Money Masters revived a central bank that had been killed three times prior).

Given a choice, if it were legal, rational people would choose to trade their skills, physical goods, etc. in exchange for those of others, as the transactional costs in doing so are de minimus, and the transactions yield far more efficient gains, free of fractional reserve parasitism and governmental 'middle man cuts.'

Think of this one example:

Mr. Smith is self-employed, and a very successful businessman. Let's say that he is a real estate developer. For every dollar of revenue that Mr. Smith generates, he will keep a mere 20 cents up until the time of his death, and after that time, every dollar he earned and saved will be reduced by well over 95%.

He pays a corporate and/or personal tax rate of at least 28% and as high as 36%, for starters. He then pays a tax to the state he lives in which could be ashigh as 12%. Every time he purchases something with each dollar, there is a general sales tax, with additional taxes on many purchases, such as gasoline, alcohol, etc. He pays tax on each piece of real estate, whether vacant, or with a structure of any kind on it. He pays a personal property tax. He pays a tax on his employees. He pays taxes and fees for licenses, permits, and other red tape schemes.

At just this point, he has had the federal, state and local authorities take in excess of 50% of each and every dollar he has generated through his work, ingenuity and industry.

After the 50%+ is put into a bank or other saving instrument, inflation of about 2.2% to 4% annually erodes his savings, and any interest or dividends are taxed by both the federal and state, again.

So, depending on for how long Mr. Smith lives, he will see another 15% to 30% loss on the money he has saved, on top of what was taken prior.

Then, at the time of his death, the government will take another massive amount from whatever he has managed to save, and that amount could be as high as 55% under current federal estate tax rates.

A NON-FRACTIONAL RESERVE FIAT system wouldn't allow the banks and the government to essentially swipe this insane amount of savings that was produced from individual effort in such an eggregious and punitive manner.


"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard."

--Alan Greenspan, Gold & Economic Freedom (1966)

Sat, 12/17/2011 - 18:04 | 1990345 Teamtc321
Teamtc321's picture

^Plus 1000

Sat, 12/17/2011 - 20:00 | 1990480 JoeSexPack
JoeSexPack's picture

Very well-wrritten.


ZH is great for quality analysis of of fiat money & fractional-reserve banking.

Sat, 12/17/2011 - 20:15 | 1990504 dizzyfingers
dizzyfingers's picture

Once 50% of voters are young, watch how fast Medicare and Social Security disappear. When young folks are allowedinto the drivers seat, Boomers and elders are effed. Not that they aren't already; can't sell their homes, can't retire, can't kick out their kids and grandkids who'd like them to die and will their jobs and estates to them.

And later the Ruling Class can bilk the youngers too!!

An endless ride for the lords.

But maybe the sheeple will wake up.

Nah! Too much to hope for.

Sun, 12/18/2011 - 02:05 | 1990822 Joseph Jones
Joseph Jones's picture

Senior voters economically pistol whip the young.  Do the young protest?  No.  They're too busy watching reality shows, listening to hip hop with ear buds, and texting to care.  It's quite remarkable.   

Sat, 12/17/2011 - 21:22 | 1990570 Ima anal sphincter
Ima anal sphincter's picture

TruthInSunshine......always a good read. Always correct.

Sat, 12/17/2011 - 19:15 | 1990431 Mentaliusanything
Mentaliusanything's picture

They may be buying something but they don't want to pay full price.

Oh yes even banks are smart enough to know that you have to "lay off" your bets in case the long shot comes romping home.

Sat, 12/17/2011 - 22:04 | 1990602 gmj
Sat, 12/17/2011 - 15:46 | 1990161 Gully Foyle
Gully Foyle's picture

Fish Gone Bad

Yes I noticed that also. Thank god two more failed this week.

What I find interesting is they were failing at about four or five a week, But for the last six months only two a week.

Is someone running out of money? Are they waiting until next year to create even more of an economic crisis for the Great saviour to glide into power on?

If you check out Calculated Risks Unofficial problem Bank list, virtually no banks in New Hampshire are in trouble.

Sat, 12/17/2011 - 20:28 | 1990521 dizzyfingers
dizzyfingers's picture

I read months ago that the home banks -- yours and mine -- would be left with their debt and when they collapsed the sharks would come in and consume what was left. But you and I would lose whatever we had in the banks. Don't keep money in banks. But the sharks will always win out until people refuse to play the games any longer.

Have only a small checking account.

Don't use credit.

Don't borrow.

Don't own property.

Don't pay taxes.

Purchase with cash, only what you require to live.

No mortgages. No school loans. (Don't go to college!) No car loans. No credit cards.

Buy farmland WITH WATER but do it on contract with the owner.

Live far lower than your means. Try to exchange work and goods among friends.

Water can be pumped without electricity. Buy a tiny place with cash and don't hook up to utilities.

When you're squeezed, resist by refusing to play the opponent's game.

Sun, 12/18/2011 - 01:31 | 1990780 aerojet
aerojet's picture

Even if nothing else crashes, if anyone follows your advice, they are fucking their entire life! 

Sun, 12/18/2011 - 10:47 | 1991315 ISEEIT
ISEEIT's picture

Sounds good to me. I rather enjoy fucking.

Sat, 12/17/2011 - 18:09 | 1990350 max2205
max2205's picture

So while much of the presented above is circumstantial, """""

Its citi.....again

Sat, 12/17/2011 - 20:30 | 1990529 dizzyfingers
dizzyfingers's picture

You're not seeing the bigger picture:

The Four Horsemen of Banking (Bank of America, JP Morgan Chase, Citigroup and Wells Fargo) own the Four Horsemen of Oil (Exxon Mobil, Royal Dutch/Shell, BP and Chevron Texaco); in tandem with Deutsche Bank, BNP, Barclays and other European old money behemoths. But their monopoly over the global economy does not end at the edge of the oil patch.


According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1]

Sat, 12/17/2011 - 21:40 | 1990583 Ima anal sphincter
Ima anal sphincter's picture

Thanks for the link. It should be read by all.

Sat, 12/17/2011 - 23:14 | 1990664 brettd
brettd's picture

BRICs and Japan are of no account?

Makes a fun headline but I'm not sure reality supports the headline.

Sat, 12/17/2011 - 14:01 | 1989977 williambanzai7
williambanzai7's picture

RD Laing:


Sat, 12/17/2011 - 14:26 | 1990026 JPM Hater001
JPM Hater001's picture

Interesting.  I followed the quote and found this additional clarification to that quote: the therapist must break up the game for the couple to move from a disjunctive conjunction to a copulative conjunction from now on.

I know just the doctor to help.

We learn more here by accident then elsewhere by design.

Sat, 12/17/2011 - 14:38 | 1990048 bank guy in Brussels
bank guy in Brussels's picture

Wonderful and profound, a quote from the great R. D. Laing for these times.


Sat, 12/17/2011 - 15:49 | 1990162 Gully Foyle
Gully Foyle's picture


Dude! Quoting from Knots. I thought everyone forgot that book.

Will you be using the chapter God as money from John C. Lilly's  Simulations of God: The Science of Belief. Simon and Schuster. 1975. ISBN 0-671-21981-2.

Sat, 12/17/2011 - 22:36 | 1990627 ISEEIT
ISEEIT's picture

Knots was a great book. Kinda a raw version of the screwtape letters. Meaning the product of deception. One of the most impactful books I have ever read was 'a windswept house'. I sincerely suggest anyone yearning for an answer as to how a global conspiracy might function read it.

Sat, 12/17/2011 - 16:44 | 1990253 philipat
philipat's picture

Quote by Donald Rumsfeld?

Sat, 12/17/2011 - 22:19 | 1990614 williambanzai7
williambanzai7's picture

If you like that quote by Rumsfeld, you will love Traders Guns and Money.

Sat, 12/17/2011 - 17:02 | 1990280 chdwlch1
chdwlch1's picture

I got screwed by the "game" last week. Bought some shares of TVIX two weeks ago. I don't buy equities or trade regularly...had a minimal amount in a Scottrade Roth account just sitting there and decided to try to make more than the .07% they pay in interest. I had noticed TVIX was getting some nice bumps on down days (5-10%) and thought I'd try to catch one of those days and cash out before options expiry day. Anyway, S&P 500 goes down on the 13th/14th and what does the TVIX do? Goes down too! Corellation for the last 6 months just disappears after $2.5 billion ($100 billion if leveraged MFG 40X) of liquidity provided to the primary dealers, who have 90% of the $700+ trillion in derivatives exposure. Then the entire commodoties complex takes a shit on the 14th too! That damn Goldman Sachs unregulated ICE (Inter-Continental Exchange) bullshit has got to stop. The hubris is what pisses me off the most though. They're not even waiting a day or two to try to cover their tracks, knowing the entire regulatory system is captured and under their control. The only bright spot I can see is that this kind of action smacks of desperation and maybe we'll see something give sooner rather than later.

Sun, 12/18/2011 - 03:09 | 1990924 thegr8whorebabylon
thegr8whorebabylon's picture

ICE;  InContinence Exchange, whereby you get the diaper full.

Sun, 12/18/2011 - 05:49 | 1991026 NeverEnuf81
NeverEnuf81's picture

lol yeah. I use VXX and TVIX pretty regularly at key ES/SPX levels, and I got burned a few times anticipating too large of a move. It's definitely not a proxy for shorting intermediate moves in the S&P—after that first statistically unlikely drop VIX's value should be systematically fading here because its value requires that traders overpay for their puts on S&P stocks even more than the change in how much they were willing to overpay to get them in the August panic.

While the market did drop, did it drop hard enough to cause traders to inflate the price of options beyond what's expected...
(I lost on TVIX in that turkeyday selloff because I kept expecting it to accelerate, but it didn't, so options didn't become increasingly overpriced, so VIX didn't shoot up. Fortunately my bearish attitude nailed buying it on the fake-out-break-out over the 200d in Oct, so I'm not too mad lol.)
It's a tricky instrument. If we drop more next week start seriously looking at it though. ESPECIALLY if we slice through 1200 again...surprisingly, most people I talk to seem to be exceptionally bullish, and that would wreck their expectations completely if the 200d had successfully crushed the bounce.

Sat, 12/17/2011 - 20:32 | 1990530 dizzyfingers
dizzyfingers's picture

It's far from a game:

It's life and death.



Sat, 12/17/2011 - 22:18 | 1990613 williambanzai7
williambanzai7's picture

It's very strange how people unconsciously work in synch. I had no idea this post was coming today. Yet last night for some reason I remembered this quote and felt compelled to go and find it. I posted it Friday evening. Then I look at Tyler's first post of Saturday and bang, eureka!

Here is a link to the book which, together with the Politics of Experience, I highly recommend:

Sat, 12/17/2011 - 23:04 | 1990655 ISEEIT
ISEEIT's picture

The word is synchronicity. We aren't really supposed to use the word let alone understand it, because of it's spiritual canotations. Back when America was a free country though people openly understood that physical reality was temporal and that people were spiritual beings on a physical plane.

Now we just buy shit and obey the authoritie.

Sun, 12/18/2011 - 02:12 | 1990831 Joseph Jones
Joseph Jones's picture

I thought the word "synchronicity" was coined by Carl Jung, no? 

Sun, 12/18/2011 - 05:41 | 1991023 UP Forester
UP Forester's picture

I thought it was The Police....

Sun, 12/18/2011 - 20:42 | 1992447 Joseph Jones
Joseph Jones's picture

Sting in Denver a few weeks ago was my favorite all-time live show...hard to believe he bested the Paul Simon conert in Las Vegas this year. 

Sun, 12/18/2011 - 08:46 | 1991136 ISEEIT
ISEEIT's picture

Curiously enough he coined the term upon the appearance of a golden bug! (no shit).

Sun, 12/18/2011 - 08:19 | 1991102 New World Chaos
New World Chaos's picture

The Universe is a giant organism which is bootstrapping itself to higher levels of consciousness.  Synchronicities are its synapses firing.  Therefore they are a sign that you (and Tyler) are near a nerve center and on the right path.  When our own neurons get simultaneous signals from different directions, it means they are meant to process the data and send it downstream.  As above, so below.

One of the occult goals of the NWO is to help people forget that they are part of the One, which makes it easier to replace Him with Lucifer in the collective unconscious.

Sun, 12/18/2011 - 15:07 | 1991943 TheMerryPrankster
TheMerryPrankster's picture

Also see the BBC documentary "The Trap: What Happened to Our Dream of Freedom" which contains footage of Mr.Laing talking about some of his ideas. 

An excellent film, some bits are on youtube.

Adam Curtis who wrote and produced this documentary also did another one called Pandora's Box.

Both are available on dvd and of course the usual sources.

Sun, 12/18/2011 - 15:01 | 1990621 TruthInSunshine
TruthInSunshine's picture

I'm also giving a h/t to wb7 for mentioning that.

And on a similar note, I actually went back and refreshed myself with Bastiat's The Law after Ron Paul mentioned it recently, which is as relevant as anything given our situation today, and it's about as concise and accurate as anything touching on natural rights.

From another's words:

The Law is about what legal systems should be, and how they have been perverted.  The true purpose of the law, according to Bastiat, is the “collective organization of the individual right to lawful defense” of the natural rights of life, liberty, and property.  But, unfortunately,

The law has been used to destroy its own objective: It has been applied to annihilating the justice that it was supposed to maintain; to limiting and destroying rights which its real purpose was to respect. The law has placed the collective force at the disposal of the unscrupulous who wish, without risk, to exploit the person, liberty, and property of others.

Sat, 12/17/2011 - 14:23 | 1990018 SheepleLOVEched...
SheepleLOVEcheddarbaybiscuits's picture

how can the american people not see what is happeneing to them?!?!?!?!?!?

Sat, 12/17/2011 - 14:46 | 1990066 TheMerryPrankster
TheMerryPrankster's picture

Wall sized TV with 24x7  immersion in cable tv reality that doesn't actually include facts, just fantasy, for the shrinking middle class.You do not want to understand, you are mesmerized by the illusion.

Grinding poverty for the lower class, where finding the day's meal and a warm place to sleep or keeping the 3 shit-ass jobs it takes to keep your starving existence, requires all your attention 24x7. you cannot afford the luxury of understanding.

Uber wealthy, you are the benefactor of the destruction machine, you don't want to think about the blood on your hands. You fill your life with trifles to hide the truth.

The remaining rabble rousers hurry about trying to awaken the zombies, who wish to remain in their cages.

The path is clear
Though no eyes can see
The course laid down long before.
And so with gods and men
The sheep remain inside their pen,
Though many times they've seen the way to leave

Sat, 12/17/2011 - 15:45 | 1990159 CH1
CH1's picture

GREAT post, Prankster. Dead-on truth.

Sat, 12/17/2011 - 15:51 | 1990171 Gully Foyle
Gully Foyle's picture


I smoked a joint and drank Schnapps with Kesey oh so many years ago.

Check out episode two of Black Mirror. Pretty much makes your point, but also adds something we all know happens but never mention.

Sun, 12/18/2011 - 14:56 | 1991922 TheMerryPrankster
TheMerryPrankster's picture

My first history book was "The Kandy-Kolored Tangerine-Flake Streamline Baby" I've always wondered what it would have been like to have lived through those days. They were I feel, the last days of freedom before the leash of the state controlled media was slipped about the populace's consciousness. We struggle on, grasping for shadows to perceive the objects we cannot see, for they have been hidden beneath the cloak of state secrets, classified and sealed away from our knowledge.

We know the world has changed, we see the changes, but we have no context, no history to understand how and why these changes occurred. Without understanding we are merely leaves tossed upon the wind, buffetted without understanding where the wind comes from or why.

The sixties were the last days before the trapdoor shut and we became prisoners in this artificial realm. It was another world.

It is telling how vehemently the sixties are described by it's critics, most either members of the establishment oligarchy or trained and educated by them. Apparently the 60's scared them an awful lot, they nearly lost control of the apparatus. It still resonates fear within them.

Sat, 12/17/2011 - 18:05 | 1990347 Cathartes Aura
Cathartes Aura's picture

y'know what goes well with the Wall of TV?

mood enhancers, anti-depressents, anti-anxiety pharma. . . record amounts of. . .

(great post MerryPrankster)

Sun, 12/18/2011 - 00:22 | 1990734 Raymond Reason
Raymond Reason's picture

You nailed it. 

Sat, 12/17/2011 - 16:49 | 1990257 philipat
philipat's picture


"how can the american people not see what is happeneing to them?!?!?!?!?!?"

Because WalMart still has stock of cheesy twirls made in China and paid for with a credit card to enjoy whilst watching Dancing with the Stars?

Sat, 12/17/2011 - 17:31 | 1990314 mendolover
mendolover's picture

Maybe because it's not being discussed during commercial breaks on Full Throttle Saloon?

Sat, 12/17/2011 - 20:17 | 1990509 Mr.Bigfoot
Mr.Bigfoot's picture

...because egregious crimes are continuously perpetrated right under our noses but go largely unreported.  When they are reported it's presented in a manner too complex for the average person to understand.  So what does America do?  Click the channel over the real house wives of beverly hills.   Ahhh, how comforting!  Now that's worth watching!                                  Sheep.    Bahhhhhhhhh

Sun, 12/18/2011 - 01:50 | 1990798 StychoKiller
StychoKiller's picture

Time to ramp up everyone's level of paranoia (and hope!):

Warning: Naked Emperors ahead!

Sat, 12/17/2011 - 22:53 | 1990643 ISEEIT
ISEEIT's picture

How does /did it ever happen? Why did soldiers once agree to stand in simple formation to fire weopons at one another as the officers remained safely distant? Why did Jews walk onto the trains? Why do Cuban's or North Korean's accept their enslavement?

Why do I work for $13.00 bucks an hour?

Seems that atrophy is the default position. Most of us are lazy cowards.


Sat, 12/17/2011 - 23:27 | 1990677 brettd
brettd's picture

We have the worst educational "system" in the developed world. 

Many, many children schooled by parents at home, with no budget,

kick the academic pants off children on whom has been spent hundreds of thousands of dollars.

Ever seen an accounting class in high school?  

Sat, 12/17/2011 - 14:37 | 1990046 Johnny Yuma
Johnny Yuma's picture

" The fed can't wait for the SOPA bill to pass to censor this website, though." 

So you're saying Zerohedge is engaging in online piracy/copyright infringements? Lol! 

Sat, 12/17/2011 - 14:42 | 1990054 cossack55
cossack55's picture

Screw SOPA. Tyler will soon be on his (?) way to a FEMA camp via NDAA.  Just waiting for the Bummer to sign and Northern Command to free a coupla Rangers. 

Sat, 12/17/2011 - 15:08 | 1990106 flacon
flacon's picture

Which Tyler?

Sat, 12/17/2011 - 22:07 | 1990605 Mr. Magniloquent
Mr. Magniloquent's picture

"I am Spartacus!"

Sat, 12/17/2011 - 23:33 | 1990687 ISEEIT
ISEEIT's picture

They would so love to know?

Sat, 12/17/2011 - 16:41 | 1990244 economics1996
economics1996's picture

Who?  never heard of him.

Sat, 12/17/2011 - 18:45 | 1990383 Barry Freed
Barry Freed's picture

At least we won't be there alone.

Sat, 12/17/2011 - 15:02 | 1990099 Barry Freed
Barry Freed's picture

SOPA has nothing to do with online piracy.  It has everything to do with transfering the power to block websites to private corporations based on UNSUBSTANTIATED CLAIMS of online piracy.  Whether you actually have, or ever had, any copyrighted material on your website is completely unrelated to their power to shut you down.

Sat, 12/17/2011 - 15:31 | 1990130 Comay Mierda
Comay Mierda's picture

"So you're saying Zerohedge is engaging in online piracy/copyright infringements?"

dumbass, read up on it.  just like when they passed the patriot act, it wasnt about patriotism, it was all about restricting your rights.  they give the bill a name indicating the opposite of what it actually does so the sheeple cheer for it

Sat, 12/17/2011 - 17:12 | 1990290 DavidC
DavidC's picture

minipax, minitrue, miniluv...


Sat, 12/17/2011 - 16:45 | 1990250 Eireann go Brach
Eireann go Brach's picture

Tyler is a fucking genius! I hope Bernake literally shits his pants at dinner tonight with his friends when they ask, so Ben what about that story on ZH that caught you rehanded bailing out a bank this week?

Sat, 12/17/2011 - 19:37 | 1990453 UGrev
UGrev's picture

Censor the website? censor? Dude.. do you have ANY idea how fast Internet 3.0 would be established by millions of uber geeks world wide?  The internet as we know it would exist only as a proxy to purchase shit on Amazon. 

Sat, 12/17/2011 - 23:29 | 1990680 Urban Roman
Urban Roman's picture

Version 3.0 is so 1970s. We are up to IPv6 now.

Sun, 12/18/2011 - 01:38 | 1990785 aerojet
aerojet's picture

Seriously.  SOPA was a nice 2nd try on Internet censorship, and it's dead in the water.  But even if it wasn't, it would be the greatest thing that ever happened to media piracy--imagine, if you will, millions of people finally giving the finger to cable companies and telecoms and just spinning their own ad hoc networks all over the fucking place!  It would be amazing!  Technology doesn't give a shit about anyone's agenda--never forget that.

Sun, 12/18/2011 - 01:55 | 1990807 StychoKiller
StychoKiller's picture

Suppressing information/Truth is like rounding up the wind for TPTB -- we're onto you -- make your time!

Sat, 12/17/2011 - 22:13 | 1990611 Tompooz
Tompooz's picture

More than enjoy. Do we have a circle of ZH readers ready to provide mirror sites for key information?

Sun, 12/18/2011 - 00:10 | 1990723 ISEEIT
ISEEIT's picture

Enough to make even president Jarrett shit her nasty panties.

Yeah bitch, I'm talking at you.

Sat, 12/17/2011 - 13:35 | 1989924 Manthong
Manthong's picture

Nice nostalgia for a Saturday morning..

Suzanne was hot.

Sat, 12/17/2011 - 14:37 | 1990044 bank guy in Brussels
bank guy in Brussels's picture

Thanks for that, wonderful clip from 'If It's Tuesday, It Must Be Belgium'.

Here is Suzanne Pleshette with Troy Donahue some years earlier, in 'Rome Adventure' while Emilio Pericoli sings 'Al di Là' as they fall in love ... she was a great beauty ...

And life in Europe is still like this ... believe it or not, you Americans ...

Sat, 12/17/2011 - 22:28 | 1990624 Imminent Crucible
Imminent Crucible's picture

Dullest movie clip I ever saw. Three minutes and eight seconds without a car wreck, sex scene, explosion, gunfight, or even a serious case of verbal abuse. No wonder Europe is sinking into recession....everyone is bored into such a catatonic state that productivity has collapsed.

Sun, 12/18/2011 - 01:58 | 1990813 Tapeworm
Tapeworm's picture

I could never get the appeal of Tippi Hedren over Suzanne Pleshette in "The Birds".

 Hitchcock's blonde fetish was a bust on that dopey movie.

Sat, 12/17/2011 - 15:00 | 1990090 Randall Cabot
Randall Cabot's picture

Her voice was limp-inducing.

Sat, 12/17/2011 - 16:50 | 1990256 Manthong
Manthong's picture

I can't figure out the junks on Suzanne.

So in the spirit of compromise and accommodation, here's something for those folks who obviously have more progressive tastes.

Sun, 12/18/2011 - 05:25 | 1991016 OldPhart
OldPhart's picture

Wow!  Is that before or after death?

Sat, 12/17/2011 - 17:34 | 1990319 mendolover
mendolover's picture

haha, I kept waiting for her to unbutton and drop the shirt!  Nice!


Sat, 12/17/2011 - 13:59 | 1989939 DormRoom
DormRoom's picture

Tuesday was also a bad day for GOLD.


I'm keeping my eye on gold prices.  ALOT of leverage is based on the gold collateral trade.  So if gold prices shifted towards normal backwardation, it'll be interesting to see its effect on collateral chains.  alot of players may go bust, if backwardation continues.


Another known unknown is Paulson liquidating more GLD in a down market and its effect on the gold collateral trade.


The world has a huge collateral problem which won't be easy to solve.

Sat, 12/17/2011 - 14:27 | 1990027 steve from virginia
steve from virginia's picture


First of all, I like the 'New, Improved' Tyler Durden who brings some analysis to the table.

I'm not 100% in agreement with all of it -- nothing the Fed does is clear particularly who its counterparties are. It could be Credit Suisse borrowing from the discount window ...

Meanwhile the gold mkts are completely f**ked up, with CME and CFTC still sitting on the sideline w/ regards to MF Global and traders exiting the Comex.

There is credit support for gold prices as w/ real estate prices and credit stipping is going to effect gold with the market-making mechanisms providing stumbling blocks to potential longs.

It looks like MF Global is 2011 version of Semgroup. First is the squeeze then the shorts' corner. Future price stability depends on new money, where is it?

The bottom-line question is whether gold/silver will gain value relative other hard assets such as property b/c right now gold value is subordinate to finance values.

Sat, 12/17/2011 - 14:43 | 1990061 cossack55
cossack55's picture

If you rule the world you have no counterparties. Duh!!!!

Sat, 12/17/2011 - 15:32 | 1990135 nope-1004
nope-1004's picture

Future price stability depends on new money, where is it?

It's in physical metals, which currently is measured by the insolvent, inadequate, corrupt, and pointless futures market.  If you insist on measuring the value of PM's by a broken mechanism, then your logic is correct.  Otherwise, there is a bigger picture here you should try to see.


Sat, 12/17/2011 - 16:55 | 1990271 philipat
philipat's picture


"The world has a huge collateral problem which won't be easy to solve."

Hypothecation? Masturbation?

Sat, 12/17/2011 - 17:17 | 1990296 WhiteNight123129
WhiteNight123129's picture

A good piece on Iran history REALLY fair and balanced. Let us circulate guys

There are some considerations of alliances with USSR which not considered. "You are with us or youvare against US" at least G.W. BUSH was honest in this statement.


Sat, 12/17/2011 - 17:53 | 1990330 mendolover
mendolover's picture

Awesome link!  This is why I like this website so much!!

Sun, 12/18/2011 - 06:48 | 1991057 mac768
mac768's picture

Let's drink a Leffe Beer as long as KBC stays afloat

Sat, 12/17/2011 - 14:28 | 1990031 Akrunner907
Sat, 12/17/2011 - 16:52 | 1990266 SDRII
Sun, 12/18/2011 - 00:06 | 1990718 lairdwd
lairdwd's picture

Kyle Bass all but said the same thing in his 12/14 newsletter. That the Fed was bailing out a bank.

Sat, 12/17/2011 - 12:55 | 1989846 falak pema
falak pema's picture

the europeans now go to the ecb, not to the fed.

Sat, 12/17/2011 - 13:05 | 1989869 I think I need ...
I think I need to buy a gun's picture

things are real quiet too quiet....

i went to a mall for the first time in 3 years  for an event yesterday,8 days before christmas, dead..... no one shopping stores closed, cash for gold place occupying a huge corner.....its all over it looks like


i see the latest cnbs headline is no one no longer wants gold

Sat, 12/17/2011 - 13:15 | 1989888 BillyBoy22
BillyBoy22's picture

I saw the same thing man, empty stalls and gold for cash.

Sat, 12/17/2011 - 13:26 | 1989901 The Big Ching-aso
The Big Ching-aso's picture



Ya, well I do know the Victoria's Secret outlet I visited was barely skimping along too.

Sat, 12/17/2011 - 14:50 | 1990073 TheMerryPrankster
TheMerryPrankster's picture

Victoria's Secret's entire business model is said to be hanging by a G-string.

Sat, 12/17/2011 - 15:41 | 1990152 GMadScientist
GMadScientist's picture

They do thrive on tranny's who want something comfortable.

You're the secret.


Sat, 12/17/2011 - 17:18 | 1990298 Xkwisetly Paneful
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2008 Bailing out of Euro banks with US taxpayer money.


UBS, Switzerland’s largest bank, was the biggest borrower from the Commercial Paper Funding Facility, tapping the program 11 times for $74.5 billion.

Six European banks were among the top 11 companies that saccumulated the most debt overall -- a combined $274.1 billion .

Dexia tapped the US government for $53.5 billion. Other European users included Barclays Plc in London at $38.8 billion; Royal Bank of Scotland Group Plc at $38.5 billion; and Paris-based Natixis at $27 billion.

The Fed listed borrowing for Paris-based BNP Paribas at $41.8 billion.

Commerzbank of Germany borrowed $350 million at the Fed’s discount window.

Sat, 12/17/2011 - 23:37 | 1990689 brettd
brettd's picture

In Virginia, the upscale mall was very busy. 

Lowes, Walmart and Sams club average.

Sun, 12/18/2011 - 01:51 | 1990800 UP Forester
UP Forester's picture

Lemme guess.

D.C. area?

Sat, 12/17/2011 - 13:23 | 1989889 Barbarous Relic
Barbarous Relic's picture

Well, if the news was leaked at 2pm on Tuesday it sure would explain the market reaction...

Wasn't that the reaction to FOMC not mentioning a QE3?  

Sat, 12/17/2011 - 13:46 | 1989917 The Big Ching-aso
The Big Ching-aso's picture



Does anyone know where I can buy a no-risk CDS on the Fed?

Sat, 12/17/2011 - 14:02 | 1989978 JohnG
JohnG's picture


Sat, 12/17/2011 - 15:16 | 1990114 Ldg433
Ldg433's picture

Providence Precious Metals is cheaper but Apmex is great too.

Sat, 12/17/2011 - 16:58 | 1990275 jimcg
jimcg's picture

Do you mean TAMPEX?

Sat, 12/17/2011 - 13:26 | 1989910 surf0766
surf0766's picture

There were so many empty store in my mall they put habitat for humanity in it.

Sat, 12/17/2011 - 14:03 | 1989980 yabyum
yabyum's picture

Not in the yabyum strip mall! A cash for gold place , a tattoo parlor, a liquor store, a check cashing joint, a porn shop and a ethnic grocery store. Embrace the future my BiTchEz.

Sat, 12/17/2011 - 14:27 | 1990028 lotsoffun
lotsoffun's picture

no gun shop?


Sat, 12/17/2011 - 14:42 | 1990056 topcallingtroll
topcallingtroll's picture

Sheeple dont like guns.

The other store is a head shop

Sat, 12/17/2011 - 14:54 | 1990080 LeonardoFibonacci
LeonardoFibonacci's picture

then they become the sacrificial ``lambs of the slaughterhouse``

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