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European FX Swap Line Usage With NY Fed Rises To Fresh Multi-Year High As More Banks Demand More Dollars

Tyler Durden's picture


While the disclosure of New York Fed's FX swap line usage with the ECB continues to be between 1 and 2 weeks delayed, courtesy of our ECB friends/Goldman alumni, who post swap line usage in real time, we find that in the week starting with tomorrow's settlement, the total swap line usages has risen yet again in the past week, this time to a fresh multi-year high of $89.7 billion, an increase of $400 million compared to last week, and the highest since July 2009. The reason for the increase is that the 7 Day swap line for $3.73 billion maturing tomorrow and used by 10 banks, and at a cost of 0.59% has been replaced with a fresh 7 Day swap line for $4.13 billion and at a higher cost of 0.61% and used by 11 banks. We do realize that this fact goes 100% against the prevailing flawed meme that European bank liquidity, especially in USD, has been restored (why, just look at BBA member bank self-reported 3M USD Libor - it is declining - by Jupiter, it means all is well!). For that we apologize profusely.


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Wed, 02/08/2012 - 11:43 | 2137925 oogs66
oogs66's picture

carry trade!

Wed, 02/08/2012 - 11:46 | 2137940 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I thought TARP/STIMULUS/QE I/QE 1.5/QE II/QE 2.5/POMO/OT2 were suppossed to fix the liquidity crunch?

Wed, 02/08/2012 - 11:51 | 2137959 hedgeless_horseman
hedgeless_horseman's picture



02-08 10:00: Irish finance minister says Ireland is moving towards recovery

Prosperity is just around the corner...past the pub.

Wed, 02/08/2012 - 12:04 | 2138025 LawsofPhysics
LawsofPhysics's picture

If only the irish could get past the pub.

Wed, 02/08/2012 - 12:06 | 2138029 Irish66
Irish66's picture

not nice

Wed, 02/08/2012 - 12:08 | 2138039 LawsofPhysics
LawsofPhysics's picture

Pessimist, I happen to think the pubs and their product are rather nice in Ireland.

Wed, 02/08/2012 - 12:06 | 2138035 vast-dom
vast-dom's picture

The autumn leaves are falling like rain. Although my neighbors are all barbarians, and you, you are a thousand miles away, there are always two cups at my table.

~T’ang Dynasty poem

Wed, 02/08/2012 - 12:11 | 2138051 GeneMarchbanks
GeneMarchbanks's picture

I love Tang.

Wed, 02/08/2012 - 12:15 | 2138060 Dr. Engali
Dr. Engali's picture

Gross. Do they still make that stuff? Or do you have it stock piled?

Wed, 02/08/2012 - 12:17 | 2138070 GeneMarchbanks
GeneMarchbanks's picture

Excuse me, I love Poon-Tang. My mistake.

Wed, 02/08/2012 - 12:18 | 2138079 vast-dom
vast-dom's picture

me 3 gene! 

Wed, 02/08/2012 - 12:42 | 2138206 Dr. Engali
Dr. Engali's picture

Now you're talking good stuff.

Wed, 02/08/2012 - 14:02 | 2138522 roadhazard
roadhazard's picture

top shelf

Wed, 02/08/2012 - 13:45 | 2138447 Killer the Buzzard
Killer the Buzzard's picture

NASA cornered the market on Tang.

Wed, 02/08/2012 - 11:53 | 2137983 ilion
ilion's picture

I came across with a Florida company Armada Forex and read their daily market wraps. Yesterday they said that crude should break to the upside which it did today. They also said EUR/USD should move higher, which it also did. Has anybody had any dealings with this firm and are they for good?

Wed, 02/08/2012 - 11:44 | 2137927 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

We might be seeing a flash crash today.  Gold and silver are signalling such, if platinum joins them stocks will crash.

Wed, 02/08/2012 - 11:54 | 2137992 WonderDawg
WonderDawg's picture

Don't be a tease.

Wed, 02/08/2012 - 11:58 | 2137997 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Here comes the bucket drop!

Wed, 02/08/2012 - 14:03 | 2138524 LongBalls
LongBalls's picture

Oil inventory is not helping gold and silver.

Wed, 02/08/2012 - 11:45 | 2137932 RobotTrader
RobotTrader's picture

Gold just tanked $12 within milliseconds of this article getting posted.


Man, those HFT's are fast.

Wed, 02/08/2012 - 11:48 | 2137948 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Stocks are following.  If the Trinity (gold/silver/platinum) all move down in freefall, stocks will crash.

Wed, 02/08/2012 - 12:14 | 2138056 Orly
Orly's picture

The EURUSD just broke its long-term Fibo line, as well.  If my calculations are correct, the next stop is 1.26438.



Wed, 02/08/2012 - 12:25 | 2138120 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You and I are on the same page Orly.

Good seeing you!

Wed, 02/08/2012 - 12:28 | 2138136 Orly
Orly's picture

Best of luck trading, Mr. Hendrix!

Wed, 02/08/2012 - 13:01 | 2138290 slewie the pi-rat
slewie the pi-rat's picture

hey, orly!

thx for the heads-up!  even tho i'm not a  fx trader, i don't think U B 'fibbin'!

Wed, 02/08/2012 - 12:53 | 2138248 trav7777
trav7777's picture

oh fkin please.  No they are not going to fucking crash.

A $12 move in gold is nothing.

Platinum's recent price action is suggestive of a temporary recovery.  But there is so much more volatility in that it is hard to read.  There is no gigantic horde of lemming getrichquick speculators trying to buy platinum coins and no shameless pumpers trying to cause stampedes into it.

Pt made a double bottom on clear divergence over the oct/dec timeframe.  While it's overbought here, and it hit an IH&S target point, it certainly isn't signalling what you claim it is.

Wed, 02/08/2012 - 11:49 | 2137949 Threeggg
Threeggg's picture

Talk about a Fractal !

  From Wikipedia:

Fractals are mathematical sets that can have dimensions that fall between the integers.[1] They are typically self-similar patterns, where self-similar means they are "the same from near as from far"[2]. Thus, on a computer, as you zoom in on a fractal image, nothing changes and you see the same pattern appear over and over.


Wed, 02/08/2012 - 12:06 | 2138031 NotApplicable
NotApplicable's picture

I just realized that Benron and the grand ZIRP4EVA game is attempting to turn fractional-reserve banking into fractal-reserve banking, in this case built of infinite IOUs with infinite counter-parties. There will be no unwind, as there will be no identifiable net position. Only more, and more, and more promises.

Hmmm... the stability of infinity. I'll have to think about that one for a while.

Wed, 02/08/2012 - 12:10 | 2138048 NotApplicable
NotApplicable's picture

First thought...




Keep those Bennies flowing.

Gotta keep debt growing.

Or Die!

Wed, 02/08/2012 - 11:51 | 2137978 Dr. Engali
Dr. Engali's picture

For those of us who bought sub $1,000 that is a terrifying drop.

Wed, 02/08/2012 - 12:00 | 2138012 ViewfromUnderth...
ViewfromUndertheBridge's picture

Could not have been related to the price first rising into the London PM Fixing and then after physical delivery price is set, the electronic price plunges...a common pattern.

Wed, 02/08/2012 - 12:02 | 2138020 LawsofPhysics
LawsofPhysics's picture

Right, the gold I bought at $532 an ounce is simply terrified.  

Wed, 02/08/2012 - 12:15 | 2138064 Orly
Orly's picture

This time, it's for real...

Wed, 02/08/2012 - 11:46 | 2137938 NumNutt
NumNutt's picture

Wow if I could only be at the bottom of this rabbit whole so I could catch all the worthless fiat they keep tossing down it.........oh....wait....actually I am ......crap...

Wed, 02/08/2012 - 11:46 | 2137942 lolmao500
lolmao500's picture

It's all normal.

Wed, 02/08/2012 - 11:47 | 2137943 LongSoupLine
LongSoupLine's picture



I smell a silver buy opportunity approaching...

Wed, 02/08/2012 - 11:49 | 2137965 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

It looks like silver will be down 3% - 4% today, gold down big, but it will take stocks with it.  Look for the Dow to be down 150 - 200.

Wed, 02/08/2012 - 12:57 | 2138272 trav7777
trav7777's picture

well as of an hour after forecasting the apocalypse, I am seeing Ag down a whole 43 cents.  Is TEOTW postponed till after lunch?

Wed, 02/08/2012 - 11:50 | 2137952 Theta_Burn
Theta_Burn's picture

Flawed meme = Brilliant strategy

Pallets of cash (if stacked correctly) = pillars of society

not sure if a sarc/ is warrented here...

Wed, 02/08/2012 - 11:51 | 2137971 SheepDog-One
SheepDog-One's picture

Skeletons of Society

Wed, 02/08/2012 - 11:49 | 2137955 SheepDog-One
SheepDog-One's picture


Wed, 02/08/2012 - 11:51 | 2137975 Mr Lennon Hendrix
Mr Lennon Hendrix's picture


Wed, 02/08/2012 - 11:49 | 2137968 Comay Mierda
Comay Mierda's picture

damn thats a lot of toilet paper

Wed, 02/08/2012 - 11:52 | 2137979 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

And after they fractionally reserve it, that's a lot of ones and zeros.

Wed, 02/08/2012 - 11:51 | 2137972 ebworthen
ebworthen's picture

Liquidity, debt, solvency problems?


They just like Ben Franklin's face (er...binary signature?).

Wed, 02/08/2012 - 11:52 | 2137980 stocktivity
stocktivity's picture

I keep reading ZH and the articles keep making perfect sense to me but there is always something out there in the real bizarro world that keeps the hopium going. It doesn't matter what the daily crisis, someone...the Fed, ECB, Merkel, or whoever the daily savior...has an answer to kick it even further down the road. I'm getting the feeling that they have much more money and power to take this out much further than most of us ZH readers believe.

Wed, 02/08/2012 - 12:08 | 2138040 ViewfromUnderth...
ViewfromUndertheBridge's picture

In Weimar people made money at times being long Marks, Gov't intervention created massive volatility and at the time almost everyone did not understand what was happening or what the end-game would be. A good book for guidance is Lords of Finance, in the 1920s and early 1930s people believed central bankers were omnipotent, until they weren't. Now, CBs are household words again...and the expectations are the same as then. They have fucked up again.

Wed, 02/08/2012 - 12:17 | 2138073 Smiddywesson
Smiddywesson's picture

Great books VfU, I love those books too:

a.  When Money Dies

b.  The Lords of Finance

c.  This Time is Different

Wed, 02/08/2012 - 12:39 | 2138189 Ghordius
Ghordius's picture

d. currency wars - james rickards

e. fool's gold - gillian tett

f. though the very best is the 1931 Constantino Bresciani Turroni "The Economics of inflation" - the only serious book that does not try to sell you anything, including gold, it just really tries to explain what really happened during the Weimar Hyperinflation, including the shifts in the industry and how the different groups in society benefited or were busted by what happened and how

g. and I urge to watch how all this started, on youtube, search for Nixon and currency, the 4 minutes speech he gave on August 15th, 1971

Wed, 02/08/2012 - 12:25 | 2138118 Gamma735
Gamma735's picture

Bubbles always go on longer than rational people believe they can.  Bubbles also deflate faster than anyone can foresee.

Wed, 02/08/2012 - 11:52 | 2137982 Jlmadyson
Jlmadyson's picture

Hey just wait until next month when all those 3 month swap lines are due.

Gonna be good.

Wed, 02/08/2012 - 11:52 | 2137984 resurger
resurger's picture

How the fuck Ron loses Nevada!

skip to min 7:00

Wed, 02/08/2012 - 12:59 | 2138279 trav7777
trav7777's picture

RP is losing because people simply aren't voting for him

Did you think the Repugnicon party was full of geniuses?

Wed, 02/08/2012 - 14:15 | 2138588 roadhazard
roadhazard's picture

repubicans aren't hardly voting, period. I don't blame them either, having a birth certificate is not enough. 

Wed, 02/08/2012 - 11:53 | 2137985 vote_libertaria...
vote_libertarian_party's picture

Apparently AAPL has an app for this too.



Wed, 02/08/2012 - 11:58 | 2138005 mantrid
mantrid's picture

so, when we get upgrade to trillions?

Wed, 02/08/2012 - 11:59 | 2138006 Everybodys All ...
Everybodys All American's picture

This is just more of Bernanke's Fed bailing out the EU defacto.

Wed, 02/08/2012 - 12:00 | 2138009 Dermasolarapate...
Dermasolarapaterraphatrima's picture

Go back to sleep!

We're busy printing......

Wed, 02/08/2012 - 12:00 | 2138010 Gubbmint Cheese
Gubbmint Cheese's picture

Banks: 'feed me Seymour... Feeeed me!'

Wed, 02/08/2012 - 12:00 | 2138011 LawsofPhysics
LawsofPhysics's picture

Flood the system with dollars, the chair satan wants inflation!!!

Wed, 02/08/2012 - 12:04 | 2138015 SillySalesmanQu...
SillySalesmanQuestion's picture

Print faster, faster, Scotty, we need more dollars...we must have more dollars Scotty...

Wed, 02/08/2012 - 12:35 | 2138172 Caggge
Caggge's picture

Damnit Scotty, I need warp print nowwwwwwwwwwwww!

Wed, 02/08/2012 - 12:01 | 2138017 fonzannoon
fonzannoon's picture

I see nothing other than the same crap going on today.

Wed, 02/08/2012 - 12:05 | 2138027 lolmao500
lolmao500's picture

The FED shouldn't give a goddamn cent to the ECB. Want dollars? Sell us assets.

Wed, 02/08/2012 - 12:07 | 2138037 NotApplicable
NotApplicable's picture

Just be happy they've found a productive use for all of those dollars. ;-)

Wed, 02/08/2012 - 12:33 | 2138164 css1971
css1971's picture

Don't they get Euros?

Wed, 02/08/2012 - 12:23 | 2138106 Gamma735
Gamma735's picture

When the dollar bubble pops it will be felt around the world.  Do you think the world will thank us when we desrtoy trillions in wealth?

Wed, 02/08/2012 - 13:00 | 2138285 trav7777
trav7777's picture

Hegemonies don't fall in pops absent major wars.

The Pound was doing just fine until WW1 then 2.  Rome took several centuries to totally wither away.

Wed, 02/08/2012 - 12:58 | 2138273 EBR MOD 0
EBR MOD 0's picture

is that destruction like the vaporization of dollars in MFG?

Wed, 02/08/2012 - 13:12 | 2138310 cranky-old-geezer
cranky-old-geezer's picture



These USD-EUR swaps have one purpose:  Keeping the Euro from collapsing.

Matches the Euro bank run chart from earlier this morning.

Together they signal collapse of the Euro beginning last week of 2011 when swaps jumped from 2 billion to 50 billion.

(It also coincides with EU's decision to boycott Iranian oil.)

This is it.  The end of the EU.

Speculation:  Germany has decided to leave.  Guess they got their DMs all printed up and ready to go.

Further speculation:  Russia has told Europe "no more gas, y'all can freeze to death".

Wed, 02/08/2012 - 13:23 | 2138371 slewie the pi-rat
slewie the pi-rat's picture

great update!

i'll bet FED has a real pile0'stinko growing up to finance these .006 deals! 

and the "liquidity" levels keep climbing, so is this liquidity "trapped" b/c the benzelbub really can't call this back w/out introducing ice-9 to 11 banks (at least)?

this "little detail" came to mind as i was considering that UBS LTRO bullshit, yesterday

my slewie charm got me tossed from the UBS lobby!

Wed, 02/08/2012 - 13:38 | 2138432 asteroids
asteroids's picture

Apparently LTRO has run out and now those banks are hitting up the FED. What happens when the FED says "no mas." ?

Wed, 02/08/2012 - 20:03 | 2139835 stocktivity
stocktivity's picture

Ha ha ....the Fed saying "no mas" is like Michelle Obama saying no more vacations on the taxpayer dime.

Wed, 02/08/2012 - 14:54 | 2138725 Bansters-in-my-...
Bansters-in-my- feces's picture

Looks like the ESF ,and the PPT spent a whole lot today to wack gold and silver down.

And platinum and pallidium is up....???

Ya o.k.

Ps....Fuck you timmy,you little weasel.

Wed, 02/08/2012 - 15:47 | 2138888 jon
jon's picture

Will the house of cards collapse? Yes.

Will the paper dollar be repudiated in the marketplace? Yes.

When?, you ask.

There will be a clear signal. The fat lady will finally sing when there is a hemorrhage of dollars leaving the US. That will be your indicator.

Where will those dollars go? Nobody knows — but it won't take many of the greenbacks seeking refuge in precious metals to cause an explosion in price.

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