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European Liquidity (Or The Complete Lack Thereof) Summarized In One Chart
Courtesy of Morgan Stanley's Huw van Steenis, we present the only chart one needs to see to understand what is going on in Europe.
And as an added bonus we have two more charts: one which shows how the market has already priced in what has happened so far through bank default risk...
And the second which shows why our base case is now for the ECB to monetize 1.7 trillion euros over the next three years.
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Pffff...1.7T....I remember when that was a big number.
no eurobonds?
shit your britchez, bitchez
http://azizonomics.com/2011/08/16/sarkozy-and-merkel-call-for-euro-governance/
Debt Rolling is different than Bailouting, the amount outstanding doesn't increase (ignore the interest).
Bullshit, the cost of creating capital is still being ignored as capital now must be created to simply pay the daily bills.
Fine, tell you what, print some capital for me to run my business, allow ALL of us access to interest free money then monkey boy.
Monetize bitchez
See the Bundesbank monthly report posted yesterday on ZH.
You want a bailout ? Give us your beaches, bitches. The Germans do love to put their towels down...
Just dig a deeper well dude. Problem solved.
Where do I send the bill?
Sounds geothermal to me...
BP?
pods
The Money Hole is traditional!
"I shoulda known that no one clean would ever lie down quite that easy"
--Lifter Puller, The Flex and the Buff Result (defunct local MN/MA band)
Great band. Last time I was at the 7th st ashtray their star was still there.
I like the cut of your jib.
The Euro countries and the U.S. are beginning to face unpredicted competition in the credit markets. China is rapidly westernizing their credit markets through Hong Kong and ramping up their open market treasury sales.
http://blog.commodityandderivativeadv.com/2011/08/19/chinese-invasion-of...
And with this article, ZH pulls the markets into the red no doubt. Tyler, you are now the most powerful man in global markets.
The first rule of Fight Club is ... ???
YOU DON'T TALK ABOUT IT !!!
Keep your piehole shut or we'll have to put together a body guard detail for Tyler soon.
cat's outta the bag - over the last few months it has become obvious that most of MSM's pathetic "journalists" are all reading ZH. I read something here and within an hour I see it regurgitated, almost every ZH article now.
Agree. It's been remarkable charting the improvement in the quality of financial journalism in most of the major 'Quality' newpapers here in the UK recently.
It is very obvious though, that this has come about only because the journalists there are simply reading ZH and re-wording the insights and data they find here. Sometimes they barely bother with the 'Re-wording' part.
Anything of importance re financial markets, geopolitical issues, etc. gets reported here first. I wonder how many goons in DC and the "intelligence" community get paid to read ZH all day. . . many, I'd wager.
Yes, it seems investigative reporting for the MSM is now coming back in vogue. And by investigative, I mean cutting and pasting interesting articles from elsewhere. Did any one checkout the comments section at the 'Globe and Mail' after their dimissive article of ZH? It was like 30 comments in a row of Globe and Mail denunciations and anti-MSM bile. No doubt their will arise some 'moderation', like at Kitco for those who mention 'John Nadler'. Kitcos tax audit for their unaudited gold couldnt have happened to better guys.
I hope the MSM reads my comments about them.
I hope the MSM sees this...
Gold $1896.00
Silver $43.94
1 American Eagle @ APMEX $48.50 / $1994
Wishing I'd bought more a while back...
My mind's eye pictures golden threads amidst a steady stream of shit....
This is a good thing.
Noticed that too?
and gold to rocket higher. $1,900 anyone?
19 to 20 will probably be the quickest jump yet
Highest print so far: $1912.08/Toz
#is now for the ECB to monetize 1.7 trillion euros over the next three years.
we have a winner.. cause FED is going monetize at least 1 trln per eyar 4EVER..
ALX
That's where I'll be putting some of my money. You know, investing with a non-bankrupt sovereign. Sadly that excludes the U.S. and much of Europe.
+65.08 (0.60%) Real-time: 11:27AM EDT it opened at plus 11k. the market is losing a point a minute.. in the next hour or so we should be in negative territory.
Makes me nervous for access and liquidity of my own cash in US banks.
I have started to surreptitiously pull extra cash out at the ATM and stash it at home...just in case there's a bank run...
Tried to withdraw low 5 figures from local bank in cash Friday. They scurried around like crazy. Was told they had to go to the Fed for it & I would get it next Thursday. Like a mini run?
ECB and Fed monetize trillions and my gold keeps going up. I sit and read Zero Hedge and get richer. That doesn't suck!
your gold going up isn't going to make you rich, it's just going to keep you even.
If it keeps him even while eveyone else's paper is sinking towards worthlessness, doesn't that make him rich?
In the land of the blind, the one-eyed man is King.
Mad Max was rich, he had 5 gallons of gasoline, a can of dog food, and 1 shotgun shell.
AND adog.........for awhile.....also, you overlooked the Crescent wrench and knee brace....valuable treasurers, no doubt.
Thats right, a bottle of water is worth all a man has who is out lost in the desert. All perspective.
A backstock of 5 gallons of gas, can of dog food, and one shotgun shell still puts him in a better position than most of the population.
Well, if all you want it to be less desparate than the rest, wow, what a goal! Me, I have higher goals, I like actually being well off, and to hell with judging if I'm doing better (or less bad) than the next guy, that's ignorant. Just having some brains and sense accomplishes that...
Vision, people!
Touche Qunitus!
Great...a king with no depth perception.
Fortunately though, despite this lack of depth perception causing him to have frequent minor car accidents, there are never any credible eye-witnesses.
http://www.youtube.com/watch?v=EBi7ZwbfQx0
@Quintus
"If it keeps him even while eveyone else's paper is sinking towards worthlessness, doesn't that make him rich?
In the land of the blind, the one-eyed man is King."
I disagree, quite strongly. Gold and silver are going to skyrocket, eventually. Then the amount of people who have any at all are going to be so 'rich' when everyone else has nothing. not a recipe for safe social situation. People will have to sell a gold coin for a loaf of bread or bottle of medicine. People (esp on this site) need to look at the broader context of what 'end of fiat' means and stop being so gleeful.. Sure have some gold and silver. But have friends, skills, stuff and start thinking outside of relative pecuniary markers - they won't help in next paradigm as much as they have in this one. Ie. buy some gold and silver - but above the amount required for personal safety I think its gonna be a trade with some unforseen negative externalities.
Been saying the same for years myself, Nate. And unlike all too many here -- actually doing something about it. Moving to and working a farm was a real bear for this ex-city boy, but man, was it ever worth it. I'm wealthy now -- but I also have money too.
All too easy to trust in "just the one thing, and now I don't have to think anymore". Yeah, you get real far with set and forget thinking in real life, or even in trading. Far from rich, that is.
so you think people will trust fiat paper in the next 6 months?
well it is nice to have ssomeone who is positive around to brighten up the place..
but I think not.. but I am HAPPY! to be wrong.. but I once again, think NOT!
I rather be even with gold owners than bond holders...
Thats OK, paper is always worthless. At least with gold, you COULD make your way to Peru where you could live like a king.
Try taking your paper stocks or bonds there, theyll soak it in water and make a paper mache sculpture.
AKA a Pinata
Yep, filled with poop.
Wow! I did not know that we have nowadays 2% daily inflation ...
No, but when Uncle Sam confiscates your gold, that will suck a lot.
That depends on if you turn over your gold, and surrendering to be a slave...sucks to be those people.
I' m not turning over shit and it's still not sucking.
How many have buried their PMs somewhere? I think it is getting near that time.
I wonder how long before heavily armed crews from the City start rolling up to Westchester/Greenwich/New Canaan with a metal detector to get themselves a piece of the Amerikkan Dream from the Bankster Elite??
See the home invasion in Connecticut?
http://www.ctnow.com/news/hc-north-branford-home-invasion-0817-20110816,...
I wounder what was int he safe? Hmm it was heavy and could not be opened. Dad took a big chance not giving up the right combo.
That old fairy-tale again. Jeeez.
Oh and by the way, they'll confiscate your paper pension and investments first. Much easier to round up a couple of trillion from a handful of major financial firms, than to send out an army of inspectors to every part of the US to force people to hand over their metal.
Yea no question theyll confiscate paper holders 'wealth' first...then they can come try to take my gold over the MG42 in my attic but I think theyll turn around and leave.
The pass they make over your house with the A10 will still leave your gold recoverable, by them. Won't take a minute, you'll not need much patience.
Sorry officer...I had a slight boating accident and it's all gone...gone, I tell ya!
Uhhhhh. Ya. That will go well
The G@M really likes you Tyler!
http://www.theglobeandmail.com/globe-investor/investment-ideas/streetwise/good-question-wrong-answer-on-canadian-banks-national-bank-says/article2137167/
Lots of juicy quotes to be revisited in the not so far off future.
So Canada has the fastest horse in the glue factory?
pods
No really, there is no way they have had a real estate bubble with stupidly high priced housing. There is no way that they are exposed to other soverign debt that is bad. Their banking practices are nothing like all the other western banks, they always mark all of their assets to market. No way, no way, TRA-LA-LA-LA-LA, I'm not listening to you Canadian banks are solid, tra-la-la-la.
Did you read the comments
Uninformed morons....
Article is an absolute joke... I love how the bank tries makes the argument Canadian banks are much more solid because the assets the Canadian banks hold are mortgages while the EURO crisis is a soveriegn debt issue....
To imply that mortgages are more secure than sovereign debt is a JOKE!!!!
I don't care if they are "guaranteed" by the Canadian government.Canadian Real Estate is in a massive bubble and when the first card gets pulled the entire house of cards comes crashing down!
Covered bonds... One example of the european ponzifinance. ECB monetized 60 billion of those in 2009-2010 when covered bond markets went frozen.
What's in those covered pools that back the bonds? Well, mostly european PUBLIC SECTOR "assets" and mortgages. Many of the european housing bubbles have already collapsed and the cashflow generation in those mortgage pools is very questionable but still most of the covered bonds are STILL rated AAA. And many of the european sovereigns and sovereign-owned entities are already insolvent and dependent of the monster-cdo called EFSF and/or ECB. Good luck Europe, good luck...
There's going to be a euro in 3 years? Kidding, right?
Liquidity crisis is like a thirst crisis and everyone knows the water is gone.
Look at what is happenig to the Indian market as a result of this EU/US liquidity cirsis. Our hot money elevated Stox MArket has been dropping like a stone these past 3-4 weeks.
Too late to dig wells or even call the dowser.
Vivek (ORI)
http://aadivaahan.wordpress.com
Got thirst? Get Brawndo, the thirst mutilator....plus its got what plants crave.
I'm looking at owning a few coconut trees myself.
;-)
Vivek (ORI)
I have no idea what is going on with gold here and I am sure either way Ben is not liking it.
1) Has gold been going parabolic because of the expectations regardless of denial that Ben has no choice but to launch QE 3 either through overt or stealth?
2) Is it going parabolic because people are front running what they believe is the inevitable QE launch and is this actually preventing him from launching QE3 because investors are tired of being burned and are using gold to prevent intervention?
3) Is it because of the above and bond monetization in the Eurozone which has to continue until a 3rd world war begins?
4) Is this a hedge against what appears to be a fiat paper wipe out from the slo mo banking crises?
5) Or is gold just the new reserve currency?
6) All of the above?
Pretty much all the above, I think the Grand Wizard Bernank has lost his mojo and people dont really care what he does....theyre out of stocks and dollars and sitting on gold.
Gold isn't going parabolic. Gold is reflecting the clueless mechinations of politicians being led by the worlds bankers. Dollar has lost about 33% to gold since 2008 and all other fiats are close.
Gold is becoming the store of value of choice.
Print Ben, Print...
7) Maybe all the above is in play, and folks like the sacks, shiti, and the morgue, are jumping on the band wagon, short term, to drive it up so that they can sell off, profit, and short it on the ride down. Bonus, you help your old bald buddy Ben out of a jam by scaring the shit out of the weak hands and make it so that they are not so easy to get back into gold again when more crisis is on the doorstep. Staged just right (the shorting, sell off) you make QE look like a good thing when it is finally announced and you pull the plug at that moment.
Of course it would just rise again, because most of us know printing means you need gold, but I bet they could create the appearance that markets are healing with a rapid drop.
Greenscam said that the price of gold needs to be kept under control in the midst of a crisis. Let it rise and profit. Then kill it and profit. Puts on a good show.
They've done this a number of times already. Create (or allow) a bubble-looking rise, let it run for a bit, get the market pundits talking it up, then get them casting doubts and calling it a bubble, then do a coordinated raid. The MSM econ pundits then hit the airwaves with "the gold bubble has burst!" It's a giant bore. They've done it enough times already that I don't even pay any attention, but you are correct in reminding the newbs here.
I will sell when the conditions that made me buy in the first place are being corrected. If anything, not only are they not being corrected, they are being made worse, made larger and more grotesque.
They've put more than a month's normal earnings in my accounts today. God bless central banking.
7) Winter is coming and Russia will demand gold in place of euros for natural gas.
Great questions - PMs are getting set to significantly rise regardless of deflation or inflation. If we have inflation, the curve will be steeper. If deflation, given the monetization of debt and sovereigns issues, PMs will be a storehouse of value. We're starting to see this and it is early stage.
Expect margin increases to occur... but don't lose sight of the fact that many people who are now buying are not speculators... they are now institutions and individuals seeking protection of wealth. Eventually margin increases will lose their impact. The more this occurs, the lesser it's impact and the more the major players are going to get squeezed.
I have no doubt that we're likely to see PM trading suspended (numerous times) in an attempt to halt market gyrations, and at this time, we're then looking at real parabolic moves once markets resume.
I have moved every penny of my retirement into PMs (bullion backed -Sprott). If I'm wrong, I still have another 20 years to plan for my retirement. If I'm right, I'll be just fine.
NB: Not investment advice.
As I have been pointing out repeatedly. The "flation" debate is pointless. Know your neighbors and get physical. Now that may have come out wrong.
Depends on the neighbors, I'd suppose.
moneytise? how? Can they monetise my imperial Russki bonds also while they are at it?
I hope the can monetize all the old Confederate notes I have in my collection too.
i hate charts where the elements in the left hand column are somewhere else in the right hand. it's pretty the way you display it, but a bitch to read.
There is really no valid argument against gold anymore. I tried to make this point last week, but--paradoxically here on one of the strongest pro-gold websites--I was beaten up for sounding like the "shoe-shine boy." The only risk in gold, as ZH has pointed out, is if Paulson needs to wind down his Gold funds through massive selling of GLD paper... or if there is an onslaught of margin increases (but this would not be as disastrous as it was for silver).
I'd like to think that Paulson is smart enough to find a way to offload his GLD holdings in such a way that the price wasn't decimated in the process.
There's only a small number of sellers who turn up at the market with a dumptruck full of paper gold/silver to sell and proceed to just tip it out all at once regardless of the impact on price.
Those sellers are not driven by a profit motive. Paulson, despite his lack of recent success at generating any profits, is.
what's the notice date for Q3 withdrawals? Q4? Query, is it better to sell GLD on the exchange(s), or redeem for allocated bullion via authorized participant and sell that?
If you are seriously contemplating redeeming your GLD shares for physical via an AP then you probably don't need advice from anyone on this site.
You probably didn't get to accumulate the kind of wealth required to buy and redeem a full basket of GLD shares by taking advice on the internet.
Funny how now 'the answer' is monetizing the debt....something they all said theyd NEVER even consider and promised not to do...remember Paulson and Bernank in front of the congress in TARP hearings? 'Oh NO sir...we're using this money to help the 'toxic assets', we'll never under any circumstances monetize the debt thru blatant stock and bond purchases'!
Now the FED and ECB just openly discuss further trillions of monetizations....sick broken world.
Yep, some of us remember, Sheep. That was back when they could plausibly deny away Godzilla standing behind them and keep up appearences of being in the pink.
Plausible deniability died in the flames of Fukushima and the latest confirmed reports of secret bailouts dearfing the official ones. PLus about another dozen or so things I can think of off the top
How can monetizing 1.6 trillion EUROS not be bullish for the dollar (at least short term)?
Because when they monetize Euros it makes those of us in the rest of the world, including the US, distrust fiat even more, exchanging more fiat for PMs. That is bearish for the dollar.
Cant monetize trust I guess.
This certainly explains the exodus of venture capital to Germany as of late. At least a lot of private jets filiing German flight plans.
Buuuut,buuuut, butttttt what about my,my,my stress tests???mumbled Jeetner
What a depressing day for equity bulls. VIX and PMs tacking on new highs and equities sinking into an even deper abyss. What catalyst besides QE3 could save this market?
The solution: Everyone come on down to DC, pick up however much you think you need, go home, shop till ya drop.
This is the worst monetization job ever! At least in the Weimar Republic and Zimbabwe, they made sure the PEOPLE got the printed up money! Now all we get is crumbs from the table at best where a few billionaires sit and get showered with more FREE billions, trillions even!
yeap thats it
It is obvious that resistence @ the 1900 level will be the test this week for Au errr I mean today and 2000 this week errr dang it is going to fast. 2500 by september 15th anyone?
Gold being shipped from BOE to Venzuela via sea? Why do I see "The Venezuelan Job" in Mark Wahlberg's future? Oh, and "based on a true story" in the trailer?
Project Mayhem, Bitchez!!!!!
Ah the gold ole days of pirates may be back. :) Sign me up. After all the communists of Venezuela wouldn't want that wealth undistributed.
Word . . . I'll get us a boat.
We all know that the big Wall Street Primary Dealers have large oil tankers. What keeps them from "borrowing" a few battleships for a few weeks, and "borrowing" a few hungry pirates from Africa for Mission "Venezuelan Gold"?
Hell, he can have me and probably many other ZHers for that cargo . . . forget Africa. I LOVE gold, and I'm already armed and well trained! Just pay me in that shiny metal!
Where are the Somali pirates when we really need 'em?
Well, here in Europe, I just went into debt for the first time in a long time- keeping the money I could pay now in gold and silver, to be paid back over three years.... its already paid off- Looks like the rest might be free, for me. What do you think?
Could Bernank possibly say NO to QE3 for the express purpose of allowing the crash to occur such that he can later say, "I told you so -- we have no choice but to print!" ???
I'm starting to see this rebound more at cat cadaver bounce and I'm sensing that something is smelly like reverse psychology or maybe?
I dont know who is around to still believe in Bernankes new 'child psychology' driven markets.
Allow a crash to happen in the fake manipulated markets, so then everyone will come running to hand over their great great grandchildrens future if only the magician can make it stop and turn stocks green again?
I think theyre all out of ammo here.
Personally I think Bernank would LIKE a much deeper market drop than what we're seeing, but simply cant do it as theres no more wiggle room left.
1st TARP/QE, USD was sitting at 90 and gold was $500. Now, not so much.