Did A Large European Bank Almost Fail Last Night?
Need a reason to explain the massive central bank intervention from China, to Japan, Switzerland, the ECB, England and all the way to the US? Forbes may have one explanation: "It appears that a big European bank got close to failure last night. European banks, especially French banks, rely heavily on funding in the wholesale money markets. It appears that a major bank was having difficulty funding its immediate liquidity needs. The cavalry was called in and has come to the successful rescue." Granted the post is rather weak on factual backing and is mostly speculative, but it would certainly make sense. That said, it harkens back to our original question: just how bad was the situation if the global central banking cabal had to intervene all over again, and just what was not being told to the general public? Lastly, and most important, slapping liquidity bandaids on solvency gangrenes does nothing but buy a few days at most. Furthermore, we now expect the stigmata associated with borrowing from the Fed to haunt each and every European bank as vigilantes will now use the weekly ECB update on borrowings from the Fed as a signal to hone in on this and that weak Italian and French, pardon, European bank.
These are the type of actions that were being taken during the financial crisis in 2008. Now most knowledgeable experts agree that not rescuing Lehman Brothers was a mistake. The authorities are not about to make the same mistake again. The only explanation for the massive action is that central banks were concerned about a pending failure that is not publically known. The readers may want to make their own judgment from the following excerpts from a statement by the Federal Reserve.
These central banks have agreed to lower the pricing on the existing temporary U.S. dollar liquidity swap arrangements by 50 basis points so that the new rate will be the U.S. dollar overnight index swap (OIS) rate plus 50 basis points. This pricing will be applied to all operations conducted from December 5, 2011. The authorization of these swap arrangements has been extended to February 1, 2013. In addition, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank will continue to offer three-month tenders until further notice.
h/t Maurice Pomery
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Wait until a big US bank almost fails EVERY NIGHT
The frequency in which bank failures "Almost Happen" is increasing dramatically. The ability to "save" them (if you call re-animation 'saving') is diminished just as quick.
The charade cannot continue without total collapse of the global economy. The great reset cometh!
I have to go count my cans of beans now..
As Tyler says, you can't solve a solvency issue with more liquidity.
The casino is still open. sit at the tables, if you want. But once the financepocalypse occurs, and people whom were virtuous, and didn't overconsume, or overspend, discover their life savings has been wiped out by either hyperinflation, or an equities collapse, will rage.
I'm even considering getting more credit, maxing out my credit cards, buying physical gold with the extra credit, and declaring bankruptcy to fcuk over the banks.
Governments will bail out the banks, so why be responsible about saving.
Did we skip the IMF funding phase or is that coming next?
If $400 billion monthly Tresurie auctions weren't already enough, and the possibility of an IMF (read US) bailout of Europe was not enough, now we have more cordinated action from Central Banks to increase liquidity (read decrease the value of fiat) to stabolize (read increase prices) so that everyone can trade their NKE shares for Nike shoes, go on their honeymoons with their dollars to Marriot in Maui, pay their bills with food stamps, and on and on.
This current way of business, at the monetary level, is not only an insuficient way of means, it is insane. If our problem is that we need more liquidity, we must look back and see what caused the crunch. It was easy access to debt/fiat. It made people complacent in understanding true value; true value of goods and time.
Now our measures extend this time frame, but like a cup, our liquidity runneth over. The policy makers will ask for a bigger straw, but this will just make the piggies fatter. Soon the piggies will die of heart failure, and once they do, the humanity will wake up realizing that the wealth of the system was drained like the blood of a goat at the alter of the Federal Reserve.
The time is nigh for the crisis to explode. The deflationary system many are waiting for already happened in '08. Just because it didn't last the year doesn't mean it wasn't there. Asset prices collapsed, and time is not a figure in monetary policy, only price. Once price was "stabolized" the game was over. The time is nigh for what we don't have a name for- it could be a hyperinflationary event, it could be a great rise in real goods (ie PM/oil) while the cities sleep with suger plum dreams. It could be anything, so be ready for it.
Keep up the bank runz, bitchez!
you mean Zombie bank runz, don't you?
banks can't fail...they will just borrow what they need, even from themselves.
If they don't have that kind of juice, just borrow it from their clients' sequestered accounts
Look at the revised ratings from this week and you have the answer, a truly globally operating bank, heavily underwater: Banco Santander!
Go to Australia, young man...
Liquidity runneth over. Like the cup indeed LH. And handle too, while you are at it.
It really does look like the Club of Rome Global Systemic Function is either lacking enough real time data or is overloaded.
Snap, crackle, pop...etc...
ORI
/the-plan/
I was pondering if I should ask which bank it was. But if the CofR is lacking data, heck, I shouldn't ask, right?
N-ever mind...consciousness keeps perma record. Some know.
barclays did a really weird very brief downward spike bout 1pm huge drop down can still see on the graph if you look
@ DormRoom: that is the Chumbawamba approach to getting rich!
Do you like how Sprott went deep into silver right before the cordinated Bank funding move? Dude is fucking savvy.
Insider
+ 1 for the Occam answer
Not surprised that the Kiwi saw it for what it was.
"...just how bad was the situation if the global central banking cabal had to intervene all over again, and just what was not being told..."
Rest assured, one of the current dramatis personae in this long-running Euro tragedy -- Frau Merkel, Monsieur Sarkozy, or more likely, Il Cavaliere -- will pen a memoir several years from now, and we will know the answer.
Not that A), There will be any hard currency to purchase said memoir with or, B) Anyone will care in the first place; the dip having been bought, the bonuses long since paid, cashed, and spent.
They already do.
I wonder which rank bank was ranked worse than the other ranked banks that rank.
Dexia was ranked least rank.
Matters not. In the end they'll all tank.
Tanks for the memories.
That's not punny.
BAC has $84B in bonds maturing next year. I would say BAC IS already there...
$84B is nothing these days. the bernake can print that in a few hours no sweet.
How about European banks and US banks take turns failing, because if the US and Europe collapse on the same day FX traders will collapse the currentsea market.
Tsunami, bitchez!
Too much credit, too much debt. No cash and a CDS bomb waiting to implode. Something very very bad is about to happen.
They will bring "Happy Days" back on TV?
Worse.
"Joanie Loves Chachi."
More likely to bring back the Musicals...
http://www.otrcat.com/charlie-and-his-orchestra-nazi-propaganda-p-2096.html
This is as LOUD as it gets as a wakeup call. You can either hear it as TPTB have everything under control and it will all be fine OR TPTB are so pathetically desperate that this is really the last clear chance before the SHTF. I am reading this as a loud SOS and preparing for the obvious implications.
It sure did, and they are being extremely quiet about it also. The don't do something like this unless a major bank is about ot go under.
Societe General? BNP? Who you got in the Dead Pool? My fiat is on SocGen.
My guess is a German bank (DB?). Maybe a warning shot for the krauts to get their prole's votes in order.
http://richardbrenneman.wordpress.com/2011/09/06/german-bank-boss-warns-of-bank-failure-epidemic/
Watch the EUR/USD today. If today's move were for real it would be at 1.36. If this drops below 1.3440...short the shit out of this move. There just isn't enough juice behind this move.
Only Reggie Middleton knows for sure.
And he ain't talkin' until the nationalization is announced.
Meanwhile, the covert deposit runs continue ...
... and have probably spread to the UK. Lloyds & HSBC ain't in Sigma X top ten for nothin'.
Reggie is amazing. Only the other day I saw him stroll past my front door and shit a ton of skittles on my lawn.
So, what's the half life of this one? Three.....maybe four days?
Eight central banks all printing in harmony to cover the unfunded liabilities that they've spent out of pensions?
The rest of our lives.
Don't even need to read the article...the answer is almost certainly "Yes".
Really...I get a junk for assuming that some bank in Europe is close to failure??? Is that you, Draghi?
BNP, DB, SocGen take your pick.
Commerzbank
Erste Bank
Credit Agricole
Banco Popular
MontePaschi Siena
Barclays
dexia?
BNP+FORTIS ten times worst than multitimes nationalized DEXIA
KBC is the next one in belgium free falling
In Germany the big problem are the Landesbanks balance sheets....
The obvious failure was at the central banks.
Add another floor to the house of cards.
West LB - currently still losing billions in their world-wide resort venture SNAFU. !9 major investments - 18 of them either went into recievership or were eventually sold for pennies. Writedowns still looming as the majority are still under recievership. The most recent was the JW Marriot Resort in Muskoka where they took a $105 million write-off in September. $80 million in hard costs with another $25 million in recievership fees - times that by 18.
All that aside, this is still a massive can kicking exercise. Just keep putting out fires with flamethrowers you cockgobblers.
This whole cumduggery is like going to the doctors after a cancer diagnosis and being offered Morphine. Sure you will feel better, but in the end you die. I guess we all want to feel better while we die.
The Federal Reserve is the Hospice of fiat cancer death.
Sooo well put. Fucking A.
May I suggest Bernanke-A. Son of a Bernanke. Mother Bernanker. Bernankehole. Things of that nature.
Right now it looks like a fistfull of meth...lets crank this up on high and make the most of it...
everyone must dead sometime
Wow....this is pathetic....this is not more than rumours from some Banksters that are on the wrong side of the deal
GO TO JAIL, directly without passing....GO
Failing banks are fine, they should be flushed out of the system. Instead we are trapped with shit institutions pillaging the countries as they know the end game is near
I think more than one bank - European or other flavor - failed last night.
Witness the overnight actions and morning "great US economic news" as evidence.
BTW, I think it's funny that everybody and their sisters focus on the equity markets, yet forget about such things as bonds and commodities.
Isn't Ben's whole "QE" and "Twist" machinations meant to drive down US interest rates? Well, last night's coordinated Central Bank intervention has done nothing but drive US borrowing costs up, over 13 bps on the 30-year and over 10 bps on the 10-year.
And, I'm sure $120 brent and $110 WTI oil will be a great stocking-stuffer for Mr. and Mrs. Average Amerikkkan this Christmas. If not higher.
As will $4.00 gasoline. If not higher.
But equities will likely rocket to 1340 or so. That's all the top 0.5% cares about.
Enjoy the arm, the leg, the eye, the ear, and your first-born it will cost you to go over the river and through the woods to grandma's house this holiday season, dipshits!
Coal. Coal would be a great stocking stuffer, provided you don't have a Dimplex 26 Electric Fireplace Insert that features a realistic flame image, inner glow logs and ember bed to create a realistic fire plus an adjustable interior light and flame speed control.
the EPA would shoot your house with a Hellfire in order to prevent the CO2 emissions from your stove.
Obviously..........They're not just going to throw up their arms and say game over...The Banksters will fight longer than Zher's can short the market...
Agreed - which is why I'm reducing my targets and looking to take money off the table. Right now the problem we have here at ZH is that the central banks are nervous - so any sign of trouble will be greeted with over-reaction.
BNP is in default.
Frenchy is done... son. Can't nationalize(AAA gone) and can't recap(AAA gone).
Well then Germany is done too.
Can't recap and can't nationalize.
Once Germany recap it's banks, it's worse than the US! (ask Kyle Bass)
how does this actually happen? Can't a bank just leverage the fact that currencies are fiat to say, "Nuh uh! I have a trillionty dollars again!" I'm confused about why these entities seem so vulnerable; can anyone explain this concisely?
They can SAY whatever they want.
But once confidence is lost, they can't get it back.
As the cliche goes . . . talk is cheap (and won't buy you anything.)
Why can't I borrow at scuh low rates? I am much more credit worthy!
Liquididty Bitchez!
No banker left behind. All in for the banks. Moral obligation.
They all failed long time ago
Agreed. This is a bad remake of Weekend at Benny's...I mean Bernies'.
It always the "last to know" wealthy clans a tad more time to repatriate their holdings and buy gold?
Whats with the Euro Rally?
Its a better currency now with 5 banks printing dollars out of thin air. Make sense? Not supose too, its just another fucking game by the master of deception Bernanke.
Did anyone ever notice that BNP holds 27.000 Mn in Italian Bonds?
or that Credit Agricole has a black hole with EMPORIKI BANK of more than 19.000 Mn Euros?
HOW CAN FRANCE STILL BE AAA? MAGIC¡
Sarkozy wearing out his knee pads
Casino open for a few weeks till the next collapse.
This "Weekend at Bernanke's" movie is good; will there be sequels?
If anyone needs reminding of the truth. Relook at Eddie's reality check.
If you haven't seen it. YOU NEED TO.
http://www.youtube.com/watch?v=lLxkyWhgaSQ
Silver up 3% Gold up 1.75%
Silver Update 11/29/11 USGS
http://www.youtube.com/watch?v=eSUG5JnBPoo
Dow up 400
More socializing of loss so they can privatize the profits :)
I think Magicians have a term for this...when you are watching the one hand..when the trick is preformed with the other...slight of hand I think...that is what we have today....everyone is agaw with all the green in the stock markets and commodities....while the banks are still in big big trouble....countries too....simple things for simple minds...
Or, they could have waited until the entire world was short equities, the Dow, Dax 30, S&P 500, etc. and then come in when everybody else wanted to cover. Unlike the 1970's and 1980's, when every CB got their collective ass handed to them when they intervened because their timing sucked, they appear to have learned something over the last 2 or 3 decades.
Granted, the premise that the system is broken and intervention won't heal systemic problems is valid, losing vast piles of money to fade them isn't so hot either. Come back at Dow 12,500 next week and let's start the up/down cycle all over again.
http://vegasxau.blogspot.com
makes sense.. if they just printed for the hell of it then I would really worry.
Anybody else think that BAC dangerously close to breaking the (5) $ last night might've led to this?
Exactly what I was thinking. When I left last evening, BAC had actually dipped just below $5 in after-hours and I thought to myself on my way home "gee, somebody will be doing something about that before the open tomorrow. Once BAC dips below $5 all kinds of shit hits the fan"... Needless to say, I didn't expect a globally coordinated bailout of the entire banking sector, but hey that's why I'm not one of the .1%, I don't think big enough.
Same here - I was thinking no naked shorting once it hits $4, or no shorting of financials, or some shit like that. I had my targets set and ready to go, and when I saw the downgrades as well I thought - SHTF tomorrow for sure. I didn't see a globally coordinated bailout of the entire banking sector though.
But you're both right - BAC dropping below $5 might have set off all kinds of events. A stock under $5 can't be margined, meaning that many would have had to sell, and there might have been all kinds of calls etc. Plus, it would have been psychological - CNNMoney covered it for god's sake.
Here are the stories I've heard:
1) One or more large European banks were on the verge of failure
2) One or more large American banks would have failed as a consequence of (1)
3) BAC dropping below $5 would have set off all kinds of events
notice how the knowledgeable experts always have the most self serving conclusions:
These are the type of actions that were being taken during the financial crisis in 2008. Now most knowledgeable experts agree that not rescuing Lehman Brothers was a mistake.
OK you don't let lehman fail, then nobody really knows how shitty the system is, there aren't calls for reform, and nobody really looks into the leverage pieces of crap that are investment banks. The fact that the elites attempt to force feed us this buch of self serving logic that comes out of their asses. further the conclusion reached is "the tax payer should always bailout banks if you take it to it's logical extension. Anybody wonder why I think this entire thing ends in violence. Because these elite crap heads are sociopaths. This of course fits in with now americans' beiong held in detention without trial for the poor suckers/ sheep who don't back out these endless self serving elites. they are as bad as louis the 14th, the tsars.