Dutch Deal Done

Tyler Durden's picture

Holland entered the bond vigilantes' radar screens abruptly this weekend, following some vague rumbling that it may be downgraded if it doesn't get its deficit in order, and culminating with a cabinet collapse once the critical austerity deal was unable to be reached. Subsequently the cabinet resigned en masse. It seems it may have to be now reappointed en masse with headlines blasting that...


The paradox is that in this market, in which more European turbulence is actually good for risk assets as it brings the inevitable next LTRO/easing event closer, any diffusion of Dutch tensions would be market neutral. Yup: enjoy the Constanza market.

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youngman's picture

Well thats just it.....I am NOT going to buy anymore European bonds....I think they are lying to me.....so now I am going to buy USA 7 years......for security of course....LOL

oops..I am the first post...bitches

Marge N. Callz's picture

There's only two things I hate in this world. People who are intolerant of other people's cultures and the Dutch.

fonestar's picture

I thought the northern Europeans were so much smarter and had invented a working socialist/welfare state?


GeneMarchbanks's picture

kah-Stan-zah catchy jingle. Where is undertheradar and why did he disappoint?

NewWorldOrange's picture

The Dutch might stand a better chance of simply "vaporizing" all that debt, Corzine style, using one of those Volcano Vaporizers at the Abraxas Coffeeshop. Only a few blocks from the center of government, and it seems TPTB spend a lot of time there anyway.

Reptil's picture

oh those are WORLDS apart. next door and yet so far away.. the politicians, "ambtenaren" live in their ivory towers, drive their shiny automobiles in the underground parking, and spend their time in their comfortable glass panelled offices. I WISH they'd visit a few coffeeshops, incognito, allbeit just for a cup of coffee. Their job is to be "politician". I think they lost touch with the real world. A lot of people have, over here. The bicycles of the top are just wheeled out for show. To persuade the rest, that they're still "primus inter pares".


NewWorldOrange's picture

"allbeit just for a cup of coffee."

But that wouldn't be nearly as gezellig!

I don't speak much Dutch though I've spent several years in all over the past 30 in Amsterdam. You're there now? Lucky you, I love that city. I reckon the tuips are in full bloom. Man, I could go for lunch at Wok to Walk right about now. Or Febo (/sarc)

I'd love to see ol' "Harry Potter" in a coffeeshop.

Reptil's picture

aaah kroket uit de muur at the Febo. you won't die. sateh kroket is my favorite. ;-)

i'm in another city, and haven't been able to spend much time outside, but.. work is nearly done (sell in may and go away) and then I'll enjoy a nice round of festivals, and some weekend trips. flowers are out yes, enjoying the bird concerts every morning. small things that matter.

NewWorldOrange's picture

Nice. And I'd be lying if I said I hadn't eaten at Febo a few (hundred) times.

Reptil's picture

Actually... I bought a vaporiser a few months ago.


I put Chamomille and very weak organically grown weed in it. Perfect! This combination repairs the damage from sigarettes.

NewWorldOrange's picture

A PORTABLE vaporizer. Nice, since most of the coffeeshops don't even have one. Are they STILL talking about banning weed for those who aren't locals? I know they've talked about it for years but last year it seemed to be reaching a crescendo (from what friends there told me by email -- haven't been there since 2005). Seems a stupid idea to me - it might reduce the drug tourism some, but it would probably bring in even more street dealers. Say, now with the ban on the sale of alcohol and weed in the same place, can a person buy weed at one place then take it into an establishment where alchohol is sold and light up? Or is that even being enforced/followed?

Reptil's picture

It can only be prohibited if there's a larger structure (government in Brussels) pushes it through, just like the Federal government in the USA.

Harry Potter's merry band of neo-con fake christian zeolots (ex prime minister Balkenende and the "invisible kardinal of powergames" Verhage tried REALLY hard to criminalise all kinds of substances. They succeeded in the case of "magic mushrooms", because the parliament was too dumb to recognise the obvious failure of reasoning that was at the foundation.

But... they'll NEVER succeed in the case of weed - Cannabis.

And with scientific evidence emerging that it's actually a powerful anti-carcinogen, and cleans soil of contamination, and has MANY other properties (as fuel, plastic subtitute, food etc.), they're on the losing hand. It's another field where a small group of powerful men (the same bunch) have denied human beings their basic rights that are natural to them.

And most dutch know that if they ban coffeeshops, it'll create BIG problems. While there are NONE at the moment. Of course there's some criminals making profit. But compared to other illegal trades, it's well under control, and largely above ground. Crime is very low here, even the use of cannabis itself is NOT widespread throughout society. So, that is why that coffeeshop can exist quite close to the center of government. BECAUSE IT DOESN'T MATTER. Also addiction is very low, the policy of treating addicts as sick people instead of criminals has resulted in a positve effect. This cannot be denied. Holland has a strong humanist culture, and much is based on "REASONABLE". As the scientific research in the phenomenon of mass use of substances in relation to addiction cannot be denied (though The DEA has falsified their research results in the case of MDMA (they switched it with Meth!!!) but were found out by german scientists.) Of course that extra criminal activity while a new criminal market emerges after a criminalistation and ban on coffeeshops, will be the reason for more police, etc. just like in the USA happened after 1970.

It's time to realise our potential, and claim our freedom. And, because I'm getting older, finally, myself I realise the importance, to teach kids and adolescents that they have to take responsibillity for that wonderful freedom. Two edged sword.

No, they'll not succeed. The push in Holland to do this, is gone now. And they're passing it on to Brussels anyway....

NewWorldOrange's picture

Awesome, and thanks very much for the long and thoughtrul post!

People in America who know I've spent lots of time there often say something suggesting they view the Dutch as a bunch of potheads. I tell them the truth, that few Dutch even partake, even in Amsterdam, and when they do, the roll a big cone-shaped cigarette and sprinkle a little weed in it (I'll never forget the time I was in some Aussie themed bar in Rembrantplein and smoking pure White Widow and I swear every one in the place kept saying, "You must be American"). Americans then say, "So the weed is for the tourists?" To which I respond, no, it's not FOR anywone. It's just that they decriminalized it because it makes a lot more sense to treat it as a public health issue. THe coffeeshops/drug tourism are just a byproduct of that. The Dutch are actually very conservative in a moral/personal responsibility sense and most of them frown on the drug use.

I've often seen Dutch mothers strolling around the RLD hand in hand with their daughters pointing to prostitutes and saying, "THAT"S where you'll end up if..." At times they prostitute sees it and rolls her eyes. Man, do they go NUTS if they see a camera. Heh.

I do enjoy Holland for far more than the liberties and have been all over the country for extended periods and have strived to learn a lot about the people, places, culture, history, politics. I was actually there in Jan 2006 (last time I was there, and had been there five months, two months longer than allowed) when an amnesty for illegal entrants was announced, and could have gotten in on that and almost did. At the airport, they were PISSED that I'd overstayed and tried to fine me big time, I said I didn't have it and couldn't get it, they threatened to lock me up, and I said, fine, lock me up and I'll just take the amnesty/citizenship. I was on the plane in an hour. Heh. But I got banned from entereing Schengen for five years!

Speaking of Rembrandtplein, there is a jazz bar there that is incredible. Small, with a small stage, and I think it's only open (well, this is 2005) on thur/fri/sat, where local musicians play and SING American jazz better than I've ever seen in America. Do you know that place? Amazing.

Do people, like parents with their kids, still routinely bombard trams and buses with snowballs while police just laugh it off? THAT is very telling to me.

Well, hell, I'd love to chat with you about Holland anytime. A favorite subject for me.

Reptil's picture

LOL they threatened Iceland behind the scenes and in 2011 even in public!




But the icelandic people have remained steadfast (another example that organisational structures can't be too big, or the citizens lose the direct influence), and they told the UK and Netherlands that the banks were private organisations, and that investment with very rich possible rewards comes with equal risk for the investor (everyone and their mum was counting themselves rich those days before the collapse) and "investing" money, even public money was in a sort of "feeding frenzy" state). No one forced the dutch municipalities to deposit the PUBLIC money into Icesave, they did that all by themselves, because of the high interest. The "smart" thing to do. Just like dutch pensionfunds invested in Fanny Mae and Freddy Mack.

Anyway, I'm seeing the same thing happening over and over again. My gold - doom story was of course frowned upon, not one nanosecond of thought it was given, while they were typing away on their HP notebooks, giddy with excitement. The few (a pensionfund of Leerdam industry workers) invested in gold, but were FORCED by the DNB (central bank) to sell this gold, because it wasn't a stable enough investment. (this was 2010 and I wrote an article about it here on ZH). They've now sued because of loss of potential income, but they're fighting some very very powerful forces. So forgettaboutit. Gold's gone. Enjoy the paper. Poor glassworkers. My dad used to have a factory building there, and used to drink with those guys in the local bar. The joke he told to me was one guy ordering 5 jenever (precursor to gin) only raising his index finger. Glas is sharp. They should've given the DNB another finger.


Reality hit them full in the face. And there were outcries of indignation of those "responsible men". This went on during spring 2011, when the EU crisis was not talked about, and forgotten. But then, Iceland was suddenly forgotten in summer 2011, when they faced a "new" obstacle (again), and they said THE (SECOND) BAILOUT TO GREECE WILL BE REPAID IN FULL, PROMISED.

over and over and over..... stupid, self important, greedy arrogance. not typical dutch. we're savers, traditionally, not easily excited by dreams of unmeasurable wealth. But that changed i in the nineties. 
Sadly... ppl. were told the last decade to save in their real estate and buy at the peak of the market (with the mistaken idea that therefore the houses would hold THAT value) I think it has to do with the fact that most people cannot envision or really comprehend exponential developments, only linear. They're all neck deep in debt. About 60 thousand households underwater I read (4 person houshold average). That is more important than you'd think, on a population of 17 million of which only half are house buyers, the others rent. For dutch that is a HUGE number. Can you imagine what austerity and a round of layoffs in the service economy would mean? it hasn't started yet. People are scared, and politicians as well. For sale signs everywhere.

And they lack the BALLS to demand the DNB to get the gold from the NY Fed. So we're stuck with paper, as a nation. Just like the Glassworker pensioners.

*sigh* I think I'll buy another roll of Philharmoniker just because. And scout some real estate for the near future. ;-)

DeltaCharlie's picture

A shmoke und a pancake. You know, a flapjack und a shigarette? No? Shigar und a waffle? No? Pipe und a crepe? No? Bong und a blintz? No? Well, then there ish no pleashing you. 

Cognitive Dissonance's picture

Did anyone really think the Dutch wouldn't make the deal and take their turn kicking the can one more foot?

I mean.......really?

Miss Expectations's picture

It's very difficult to not believe what I want to hear.

Cognitive Dissonance's picture

We are the source of most of our own confirmation bias......though we will always blame someone or thing else.

Denial ain't just a river in Egypt.

zilverreiger's picture

What happened is the missionary government fell monday and is now demissionary until the next elections in september. To not waste this time, for the sake of the nation in crisis, they stroke some deals with the opposition on fundamental points, to restore some stability by majority. Because they have to give the EU some form of budget april 30.

MieleBauknecht's picture

The austerity deal was rejected because of the PVV, an extremist anti-immigration, anti-europ right wing party in the former dutch cabinet. After the resignation, a deal became simple because there is a large pro-eupean majority in parliament. They can't afford to let the deficit grow above 3% because they will then be the lauging stock of all other eu countries just because jan kees de jager (economy) was the hardliner that forced greece into all kinds of agreements that they will stick to their austerity measures. 

BeetleBailey's picture

I have heard Amsterdam has some kickin ganja.

Stink weed bitchezzz!

junkyardjack's picture

Sounds like the bottom is coming up

Kristian's picture

Going Dutch has just got another meaning:).

Equites's picture

As Dutchy, it doesn't surprise much - what was surprising was the long dependency on a tendacious-to-racism-right-wing party that kept Dutch politics in a stalemate.

Dutch have been swearing to 3% like there's no tomorrow, and "we" would lose all credibility if we'd give it up. I loved how ZH reported on how Greeks thought the Dutch were being rather hypocrite in dropping a cabinet over 3%...

Though politically I wouldn't vote for him, the current Dutch minister of Finance deserves a "clear speech" award - he's been extremely consistent in keeping much of the past years of crisis relatively comprehensive for the 99% in the NL ;)

For Target2, it would've been rather interesting to see what an increasing Dutch spread would mean. But my taxpaying gut is happy it isn't.

Reptil's picture

I think someone realised there was a bump in the road, pressed a button and made this all palatable suddenly. this was already posted, but it's relevant http://www.telegraph.co.uk/finance/financialcrisis/9226543/Brussels-to-r...

and if J.C. de Jager wins the "clear speech" award, perhaps he can explain how he will keep the "promise" that all bailouts to Greece will be repaid? See last summer, when everyone was baking on the beach of Benidorm, or Zandvoort, they sold us out. And no mention of this, any more.
c'mon... these are the same ppl. that threatened Iceland with "harde acties". They'll now try to damage Wilders of the PVV as much as possible, because he didn't play ball. Rumours say he was forced to not agree from within his party. That is entirely possible.

normally important issues are NOT openly discussed anymore, like in the last elections.. was there any difference of opinion on how to counter the crisis? of course not. ignore it and it'll go away. let someone else decide (and take the blame) so no heads will roll in the courtyard of "Het Binnenhof". ssshhh

one big puppetshow - poppekast

I don't buy it. Equites, you can keep your "clear speech award" no offence intended, but I think it smells of bullshit.

How are they going to sell the ESM, and it's status above our constitution? mmm? Just like they did with the Lisbon Treaty? (not at all)
I'm waiting........ with baited breath.

NewWorldOrange's picture

Another great post! I haven't been entertained like this by someone Dutch since my last trip to Boom Chicago ;)

ForWhomTheTollBuilds's picture

Perhaps I dont understand what is happening.  Let me explain what I see:


1) Cabinet has no confidence in govt budget => non confidence => mass resignation.

2) Same cabinet re-appointed => agreement on Budget from step 1).


In the interem, who gathered these men into a room and said, "You are going to go back in there, you are going to vote like THIS and you are going to smile and make a point of the fact that this is your free choice"...

Reptil's picture

No, one guy (Wilders of the PVV party which is an odd mixture of wannabe megalomaniacs, right wing nationalists and the odd racist) dunked a turd in the festive punchbowl of silence.

Because that is what is happening... we're "changing" from a souverign state, with tested laws and Constitution, based on age old humanism, and a tradition of openness, into a vazal province of some fat little belgian banker or weasel italian Goldman Sachs laureate. AND THEY DON'T WANT TO TELL THE PEOPLE, BEFORE IT ACTUALLY HAPPENS.

Because they're scared stiff of repeating what happened in 2005, when the majority of the country suddenly voted en masse a resounding "NO" to some frankenstein bundle of treaties that they dared call a Constitution.

And some of us object, because we've been predicting this to occur since 2008 (when they glossed it over with extra gov. spending and gigantic bailouts for all kinds of financial stuctures). But the majority doesn't know, because they're mis-informed (baffled with bullshit)

So... what Wilders pulled is the "I'm going to tell them" card. He's a populist powermonger, but this time he was right. And the debate, that should've been used to un-earth the question of WHY it failed, was used by the politicians to talk about themselves, and to point at the value of "democracy", instead of calling the dog by it's name.

What bullshit to force austerity, when government deficit was created by mismanagement. So... the coward politicians took the easy way out. No accountabillity, because of no accountable ministers or prime minister...

booooo! they FAIL at governing. pure and simple. and we will stick to our Constitution, plain and simple. i don't recognise any other law and simply reject the nonsense. And I'm not the only one, but we're in a minority. So.... in order for their bullshit plan to absorb the State of the Netherlands into the EU, they need citizens that are herded towards it, with promises of more prosperity. I'll draw out the next step: After it's signed (ESM), bring on the austerity, the corporate state. It will be too big, for us to directly influence politics, as can be witnessed by the corruption that's at the heart of the financial failure.

NewWorldOrange's picture

I'll be looking forward to your posts from here on out Reptil ;) Cheers!

Reptil's picture

Does she want more (greek) islands? I heard ze Germans already bought the Balearic islands.

I think you're right. They will lose considerably if there's a panic.

Rogier's picture

Bottomline: when push came to shove, the Dutch politicians bridged political differences and struck a solid budget deal within 48 hours. Eat your heart out USA...

Joe A's picture

In the Netherlands it has been decided to cut on care for the elderly and the handicap, to raise VAT and impose a 'one time' tax raise, to increase rents for middle incomes, etc. in order to stick to the EU's 3% budget rule. The parties that decided on this smell the stuffy smell of those warm government seats but might be finished off when election time comes. This is all about party politics. One party that agreed to this budger plan was the Green Left for crying out loud. It remains to be seen who will be laughing when elections come in September. Geert Wilders will run an anti EU campaign just as the Socialist Party will do. These two might turn out to become the biggest winners of the elections.