The ECB Has Stopped Preparations For A Collateral Management Program

Tyler Durden's picture


This just crossing the streams:


We have no idea what this means, but rumor is that the ECB finally looked at its "collateral" and found a picture of the Athens Ministry of Finance...

And the actual statement:


15 June 2012 - Eurosystem collateral management services and systems


The Governing Council of the European Central Bank (ECB) has decided to discontinue the preparations for the Collateral Central Bank Management (CCBM2) project in its current form. In the project detailing phase, a number of challenges in the field of harmonisation were identified and the Eurosystem has decided to address these issues first before proceeding further with a common technical platform. The existing Correspondent Central Banking Model (CCBM) for cross-border collateral management remains in place.


In the immediate future, the Eurosystem will concentrate on implementing the previously announced enhancements to Eurosystem collateral management services, namely the removal of the repatriation requirement from the CCBM and the support of cross-border triparty collateral management services within the CCBM. Both enhancements will be introduced in the Eurosystem collateral management framework in the course of 2014. Furthermore, the Eurosystem will prepare for the support of T2S auto-collateralisation procedures.


The Eurosystem will also continue assessing and developing its collateral management framework and practices, liaising closely with the market to understand future needs. Emphasis in this respect shall be placed on harmonisation, with the initiation, both within the Eurosystem and in collaboration with the market, of a broader reflection on the harmonisation of collateral procedures.

Here is the ECB's CCBM2 project. Now terminated. Would it be possible for Bloomberg to submit a FOIA to the ECB to inquire if Goldman provided advice to its former employee at the head of the ECB to terminate this project?

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Fri, 06/15/2012 - 09:13 | 2528885 mrktwtch2
mrktwtch2's picture

im sure this will be somehow spun as bullish..

Fri, 06/15/2012 - 09:16 | 2528901 Zgangsta
Zgangsta's picture

Some inside knowledge that SYRIZA will get destroyed in the election?  Or Tsipris himself will be destroyed before the election?

Fri, 06/15/2012 - 10:30 | 2529229 slewie the pi-rat
slewie the pi-rat's picture

slewienomics indicates the harmonizations will be worked out in tablature...  in a barber shop!

Fri, 06/15/2012 - 10:41 | 2529272 NotApplicable
NotApplicable's picture

Mark it to zero. So simple, even an ECB stooge can do it.

Fri, 06/15/2012 - 09:18 | 2528917 American34
American34's picture

Our bailout vocabulary is about to expand exponentially! BULLISH!

Fri, 06/15/2012 - 09:21 | 2528936 Divided States ...
Divided States of America's picture

which also probably means that "The ECB Has Started Preparations For A Collateral Damage Management Program"

Fri, 06/15/2012 - 10:00 | 2529093 Waffen
Waffen's picture

Never cross the streams!

Fri, 06/15/2012 - 09:13 | 2528886 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

they just fingered out what they had?

Fri, 06/15/2012 - 09:14 | 2528889 Boilermaker
Boilermaker's picture

Obviously, they've never seen an episode of Storage Wars.

Shit man, there could be a few rolex watches in those bags and priceless antiques.


Fri, 06/15/2012 - 09:16 | 2528902 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

you gamble on those lockers, just like central banks, you don't know what kind of shit is in there.

Fri, 06/15/2012 - 09:14 | 2528890 Bazinga
Bazinga's picture

Can someone please translate what this new rumor headline means? My BS-ometer is a little off today...or perhaps I am now officially numb to the nonsense.

Fri, 06/15/2012 - 09:26 | 2528963 mayhem_korner
mayhem_korner's picture



Let's wait to see how the algos respond.  Then we'll know what it means.

"We need to pass the bill so you can find out what's in it." 

Fri, 06/15/2012 - 11:20 | 2529406 beastie
beastie's picture

Was it working committe to assess the possibility?

It sounds like the they have given up on the idea to create a super bad bank to manage the junk from all over europe becasue it would be unworkable and probably the main reason is all the collateral has already been pledged in one form or another. Probably pledged many times over if truth be told.

Fri, 06/15/2012 - 09:18 | 2528897 sockratte
sockratte's picture

shouldnt this be the target system???

greece cutting off of the system? *g*

Fri, 06/15/2012 - 09:15 | 2528898 stant
stant's picture

hoarding is a sickness

Fri, 06/15/2012 - 11:49 | 2529503 Matt
Matt's picture

Funny, that's what I told the IRS, after they requested my financial records for the last five years, and I told them I did some house cleaning.

Fri, 06/15/2012 - 09:16 | 2528899 Whoa Dammit
Whoa Dammit's picture

We have met the collateral and it is us (Us is the American worker/tax payer).

Fri, 06/15/2012 - 09:20 | 2528918 wisefool
wisefool's picture

El-Erian (PIMCO)  is on bloomberg right now postulating the USD being the new currency for europe. This is after goolsby (D) and cantor (R) talked about the glory of the US tax code ( the perpetual jobs program for the congress criters)


Fri, 06/15/2012 - 09:32 | 2528983 j0nx
j0nx's picture

Only because we continue to allow it. Put that in your pipe and smoke it.

Fri, 06/15/2012 - 09:39 | 2529010 insanelysane
insanelysane's picture

The collateral is a list of social security numbers.

Fri, 06/15/2012 - 09:16 | 2528904 Seize Mars
Seize Mars's picture


This place is crappin' cash!

Fri, 06/15/2012 - 09:17 | 2528906 the 300000000th...
the 300000000th percent's picture

Well nice, now that pesky collateral is out of the way, the numbers of bailout figures can be even more ridiculous

Fri, 06/15/2012 - 09:18 | 2528909 Mister Ponzi
Mister Ponzi's picture

According to the linked documentary (in German) this is not a picture of the Ministry of Finance but of the Athens office of the Greek equivalent of the IRS. Doesn't make things better though...

Fri, 06/15/2012 - 09:18 | 2528911 Yikes
Yikes's picture





Fri, 06/15/2012 - 09:28 | 2528945 mayhem_korner
mayhem_korner's picture



Maybe they've shifted to the Collateral Damage Program.

Edit: Divided States beat me to this @ 9:21, above

Fri, 06/15/2012 - 09:18 | 2528914 presk_eel_pundit
presk_eel_pundit's picture

Old story. Old picture. Still funny though.

Fri, 06/15/2012 - 09:19 | 2528919 insanelysane
insanelysane's picture

I don't think the ECB wanted the citizenry of various countries to be able to easily see what they are giving up in exchange for the "free" money.

Fri, 06/15/2012 - 11:46 | 2529492 Bob
Bob's picture

That might really fuck up the harmonization process. 

Fri, 06/15/2012 - 09:19 | 2528921 outamyeffinway
outamyeffinway's picture

That chair with the missing fabric and gnawed at by rats stryofoam must be worth something.....?

Fri, 06/15/2012 - 09:23 | 2528948 farmjohnny
farmjohnny's picture

I know, "lets collateralize the rats" wait, we already did that.

Fri, 06/15/2012 - 09:20 | 2528927 SeverinSlade
SeverinSlade's picture

That's what Brian Sack's office is going to look like on July 1st.

Fri, 06/15/2012 - 09:21 | 2528935 Martin W
Martin W's picture

ECB is about to kill Trispas using a 5 tons block of fiat money 

Fri, 06/15/2012 - 09:21 | 2528937 mayhem_korner
mayhem_korner's picture



Sounds like they've adopted the MF Global model.

Fri, 06/15/2012 - 09:22 | 2528940 Dr. Richard Head
Dr. Richard Head's picture

Don't cross the stream.  That would be bad. 

Fri, 06/15/2012 - 09:25 | 2528955 farmjohnny
farmjohnny's picture

...and dont look at the trap

Fri, 06/15/2012 - 09:23 | 2528947 Benjamin Glutton
Benjamin Glutton's picture

all your junk bonds are belong to you.


Lead a bank to liquidity, but you can't make it lend

In other words, you take your junk lower quality paper to the ECB and you reserve your high quality collateral (e.g. bunds) for the private repo market. The problem is that the private repo market continues to seize up because of a lack of high quality collateral and a rising sense of risk aversion over counterparty risk, i.e. you don't trust that you are going to get paid back so you demand really, really good collateral.

No matter how the ECB steps in to inject liquidity into *ahem* second-tier debt market, Kaminska wrote that the market has lost confidence and there is little the ECB can do [emphasis added]:

Private markets must be convinced to lend unsecured or invest money in more than just the last few remaining AAA bond markets.

But as they say, you can lead a horse to liquidity but you can’t make it drink. Which is a shame, because that’s the main problem the ECB and other central banks are now facing: they are leading banks to liquidity but they can’t make them lend in private markets.

The ECB's experience with LTRO should be a cautionary tale for the Fed as it considers a QE3 program of purchasing MBS. You can lead a market to liquidity, but you can't make lenders lend and borrowers borrow.

Beware of unintended effects, Mr. Bernanke.

Fri, 06/15/2012 - 09:24 | 2528950 Quinvarius
Quinvarius's picture

I guess they dumped their last ton of collateral in the gold market. 

Fri, 06/15/2012 - 09:24 | 2528951 caimen garou
caimen garou's picture

is that the new age filing system that all of europe has adopted?

Fri, 06/15/2012 - 09:35 | 2528990 TonyCoitus
TonyCoitus's picture

fuck this shit, i'm going golfing!

Fri, 06/15/2012 - 09:36 | 2528994 the not so migh...
the not so mighty maximiza's picture

There is no Collateral so there is nothing to manage.

Fri, 06/15/2012 - 09:37 | 2528997 Iconomissed
Iconomissed's picture

Rehypothecated vapors are just too hard to count

Fri, 06/15/2012 - 09:49 | 2529041 debtor of last ...
debtor of last resort's picture

The fresh printed D-Marks are ready an dry before monday.

Fri, 06/15/2012 - 09:58 | 2529085 bentaxle
bentaxle's picture

It's Nothing that matters in the slightest. Just decided not to Clear Crap from Basement on Monday (2 nd attempt,) and letting everyone know, in the spirit of (European) Harmonisation, of course. Maybe we should reply in kind with a bit of ZH Harmonisation? Like, "no shit, Bitchez?"

Fri, 06/15/2012 - 10:01 | 2529103 DavosSherman
DavosSherman's picture

These fucking morons will only figure out they have to revalue the currency by creating new ones after every "dawler" on the globe becomes totally fucking worthless.

Fri, 06/15/2012 - 10:07 | 2529130 Jim in MN
Jim in MN's picture

Bullish.  Anything they do manage just gets more fucked up.

Fri, 06/15/2012 - 10:43 | 2529275 JackT
JackT's picture

WTF?  Sounds like crazytalk


"challenges in the field of harmonisation were identified "


Fri, 06/15/2012 - 13:14 | 2529529 Bob
Bob's picture

Agreed.  A mad sorcerer's incantation. 

Or a serial killer's masturbatory chant. 

Who knows?

Fri, 06/15/2012 - 11:55 | 2529536 Matt
Matt's picture

It seems to me they are talking about switching from having several seperate software platforms, over to a single one for all of the Eurozone. Turns out it was more challenging than expected. Pretty common when switching from numerous legacy platforms to a single modernized one.

Fri, 06/15/2012 - 11:07 | 2529358 bankruptcylawyer
bankruptcylawyer's picture

IF THE ECB want to reorder the entire banking system with free paper, they better place the bailouts on hold and start spending their money on a pan-european army to subdue the militarie's of all the countries they want to take over. 

this would mean germany and france uniting their militaries into a 'euro' military---to subdue the piggs and impose martial law on them. in that scenario you're looking at a european war. it's hard to imagine it could work out to their benefit. probably a lot of shit would get blown up, america would be asked to help out---and of course america would have secret deals with the EURO-army, but in public america would make it look like all would be ok for the little piggies. 

still, i don't think the U.S. germany and france working together could easily take over the rest of europe without killing a hell of a lot of people which wouldn't really work out well for the europeans, but after a short devastation lasting a year or so, maybe the banks could all be made european banks, with true subordination of the fiscal and taxing authority of the european government. 

honestly, who ever really thought banks were going to unite europe without bringking europe to a massive war again? 

more likely outcome-----pan-european economic collapse. why? because it's just easier and simpler.

Fri, 06/15/2012 - 11:50 | 2529509 Bob
Bob's picture

I love that "harmonization" concept. 

It sounds so nice.  Like music.

Just take your soma and all will be well in Oceania . . .

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