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ESM Termsheet - Page 1, footnote 2....

Tyler Durden's picture




 

From Peter Tchir of TF Market Advisors

ESM Termsheet - Page 1, footnote 2....

Talk about launching ESM early and in conjunction with EFSF has helped the market rally. 

On Page 1, the ESM will have an effective lending capacity of 500 billion (footnote 2)  During the transition from EFSF to ESM, the combined lending capacity will not exceed this amount.

Somone better ask Finland and Slovakia whether they are prepared to fund both?

Are stocks as strong as they are because Algo's are good are reading headlines, but suck at finding termsheets and reading them?

 

 

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Fri, 10/21/2011 - 12:59 | 1797546 Ahmeexnal
Ahmeexnal's picture

Just let us short eurocrapian markets!

Fri, 10/21/2011 - 13:00 | 1797550 jarboejl
jarboejl's picture

Markets have stalled out.  Algos must be staring at that footnote awfully hard.

Fri, 10/21/2011 - 13:06 | 1797571 buzzsaw99
buzzsaw99's picture

how much of this money will go to the squid i wonder?

Fri, 10/21/2011 - 13:45 | 1797742 gatorengineer
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Squid wants Greek credit event, so all of those delicous CDS's go off............  It will be a string of squidlicious CDS events going off months after Greece fails.....

As sick of a thought as it is, not a bad time to buy some squid.....

 

Fri, 10/21/2011 - 13:51 | 1797770 slewie the pi-rat
slewie the pi-rat's picture

the quid to the squid?  110%

heluva job, brownie!

Fri, 10/21/2011 - 13:07 | 1797573 pendragon
pendragon's picture

this is beyond a joke. 160+ s&p handles and 8 big figures in eurusd on a double count

Fri, 10/21/2011 - 13:48 | 1797753 slewie the pi-rat
slewie the pi-rat's picture

count dracula:  coffee is perky, today!

count de monte cristo:  indeed!  say, could i bother you for the grey poupon?  it is just wonderful on this swiss cheeZe!

Fri, 10/21/2011 - 13:09 | 1797576 It is a bargin ...
It is a bargin my friend's picture

Someone better ask Finland and Slovakia?

According to this if they signed on the dotted line there is no need to ask..its due

http://www.youtube.com/watch?v=rxMOW94V6xQ

Fri, 10/21/2011 - 13:44 | 1797731 Manthong
Manthong's picture

"During the transition from EFSF to ESM, the combined lending capacity will not exceed this amount."

.. unless they need more.

Fri, 10/21/2011 - 13:10 | 1797581 buzzsaw99
buzzsaw99's picture

and what is the cut for the tattaglia family?

Fri, 10/21/2011 - 13:11 | 1797587 machineh
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'The consolidated EFSF and ESM lending shall not exceed 500 billion euros.'

'Non euro area Member States can particpate on an ad hoc basis alongside the ESM in financial assistance operations for eura area Member States.'

Oh yeah, I'll bet they're lining up in the corridor to get on this deal!

Fri, 10/21/2011 - 13:11 | 1797588 espirit
espirit's picture

Hint, hint.  Sort of gives a clue how much QE the Bernank plans on at the Nov. 3 meeting doesn't it?

The Amerikan taxpayer funds these follies under a MBS sham, although they just don't realize whose MBS they're buying.  Sad...

Fri, 10/21/2011 - 13:14 | 1797598 jarboejl
jarboejl's picture

A video for anyone who believes that this bailout of Europe will actually work.

Oh yeah, I'm bringing it back!

http://www.youtube.com/watch?v=3Fg2NRCB9Sc

Fri, 10/21/2011 - 13:17 | 1797606 machineh
machineh's picture

'The ESM will have a total subscribed capital of € 700 billion. Of this amount, € 80 billion will be in the form of paid-in capital provided by the euro-area Members states, of which € 40 billion will be available from July 2013 with the remaining share being phased in over the following three years.'

Hey, did anybody notice that this is just VAPORWARE? 

Almost two years from now they're going to have € 40 billion of paid-in capital?

This is no bazooka ... it's a broken BB gun with bubble gum plugging the barrel. LOL!

Fri, 10/21/2011 - 13:48 | 1797758 Dick Darlington
Dick Darlington's picture

And the funniest thing is that NONE of the euroutopia members have that money. NONE. They NEED TO BORROW the money in order to pay their shares of the capital. Oh, ponzi scheme's a bitch...

Fri, 10/21/2011 - 14:11 | 1797857 FinHits
FinHits's picture

Finland has agreed to pony up all of her share (€1.4 billion) immediately in one go rather than in five installments, and can easily do it as well. This was the quid-pro-quo for getting partial collateral on the (forthcoming) Greek Bailout II. But for sure it will piss Finland off, if EFSF somehow now gets collapsed into ESM and the amounts will get double-counted.

http://ftalphaville.ft.com/blog/2011/10/12/698756/a-finnish-view-on-greek-debt-losses/

Fri, 10/21/2011 - 14:25 | 1797913 Dick Darlington
Dick Darlington's picture

Sure, Finland can easily do it but the point is that even Finland doesn't actually have the money. They will need to borrow it just like everyone else.

Fri, 10/21/2011 - 15:29 | 1798207 FinHits
FinHits's picture

You are correct, sir.

Fri, 10/21/2011 - 13:17 | 1797607 A Man without Q...
A Man without Qualities's picture

One suspects that various other member nations guessed the intentions of the FPIGS so put measures in place to prevent backdoor attempts to leverage up the risk sharing... 

Now what Monsieur Sarkozy?

Fri, 10/21/2011 - 13:46 | 1797745 gatorengineer
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Ok, so its white out and printers ink that are needed.....

Fri, 10/21/2011 - 13:55 | 1797795 AldoHux_IV
AldoHux_IV's picture

It's basically another synthetic cdo or consider this the backup to the backup with no real plausible nor credible funding measures for this or the EFSF. It's just going to be a tranche of 'crap' (to steal a phrase from GS) and when that fills up, the next tranche aka EFSF will be there to help until they create an EBSF (Euo BS fund) to aborsb any other necessary funding gaps sovereigns may be facing at a later point in time.

1. This is a pathetic attempt to maintain credit rating strength by 'shifting the risk' somewhere else.  Guess they figured that the credit agencies were too moronic to rate the cdo's of past appropriately to sniff out this total blunder called the ESM/EFSF.

2. You can only balance transfer to another credit card at a lower rate until: a. you run out of money because you're insolvent b. rates creep higher on the next credit card because the teaser rate is subjected to prevailing market conditions i.e. funding pressures due to the continuation of the same old bullshit.

3. This is hilariously pathetic and falls short of any real solution-- yeah it's going to take many strokes to fix this problem, but in this case it's the kind that happens to your brain because markets have to lose their thinking capacity in order to think this'll work.

Fri, 10/21/2011 - 14:05 | 1797823 Dick Darlington
Dick Darlington's picture

I would add to your point #1 the fact that euroutopia members decided to "shift the risk" somewhere else because under the Lisbon Treaty there's this tiny, little, small inconvenient "thing" called NO BAIL OUT -CLAUSE (Article 125). The eurofanatics created the cdo monster to go around that. Of course they are still breaking the treaty and this is only technical issue, smoke and mirrors to justify their actions. I'm amazed that so little attention has been given to this.

http://euwiki.org/TFEU#Article_125

Fri, 10/21/2011 - 14:17 | 1797878 Finance Addict
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How exposed are the U.S. banks to the eurozone crisis? http://bit.ly/q6lzEx

Sat, 10/22/2011 - 07:04 | 1799717 Fips_OnTheSpot
Fips_OnTheSpot's picture

Too bad, them Tylers never hopped on the actual ESM contract I've submitted:

run this thru google-translator for your fav'd language:

http://www.freiewelt.net/blog-3321/lesen-sie-hier-den-vertragstext-des-e...!.html

If you think Hitler was bad, this will frighten you to death.

Do NOT follow this link or you will be banned from the site!