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European Money Market Industry Shutting Down As Goldman Closes MM Fund, Says In "Unchartered Territory"
Update: BlackRock to restrict subscriptions into 2 Euro money funds
We were the first to bring news that overnight JPMorgan has halted investment in its European money market funds following the ECB's decision to cut the deposit rate to 0%. Now, it is Goldman's turn:
- GOLDMAN HALTS INVESTMENTS IN EURO GOV MONEY FUND AFTER ECB CUT
- GOLDMAN SAYS MARKET CONDITIONS WILL DETERMINE WHEN FUND REOPENS
- GOLDMAN DECISION AFFECTS EURO GOVERNMENT LIQUID RESERVES FUND
And finally the conclusion, which is rather obvious:
- GOLDMAN FUND MEMO: EUROPEAN MARKET IN `UNCHARTERED TERRITORY' (Er, sic?)
More from Bloomberg:
JPMorgan Chase & Co. (JPM), Goldman Sachs Group Inc. (GS) and BlackRock Inc. (BLK) closed European money market funds to new investments after the European Central Bank lowered deposit rates to zero.
JPMorgan, the world’s biggest provider of money-market funds, won’t accept new cash in five euro-denominated money- market and liquidity funds because the rate cut may result in losses for investors, the company said in a notice to shareholders. Goldman Sachs won’t accept new money in its GS Euro Government Liquid Reserves Fund, and BlackRock, the world’s largest asset manager, is restricting deposits in two European funds.
JPMorgan’s five closed funds had 23.7 billion euros ($29.2 billion) in assets as of July 5, the bank said in an e-mail, about 22 percent of all euro-denominated money funds. The funds are JPMorgan’s Euro Liquidity Fund, Euro Government Liquidity Fund, Euro Money Market Fund, Euro Liquid Market Fund and JPMorgan Series II Funds -- EUR.
The deposit rate cut “will almost certainly move cash bids in short-dated instruments into negative territory, and so we have taken the step to restrict subscriptions and switches into the funds in order to protect existing shareholders from yield dilution,” JPMorgan said on its website.
The company had $417 billion in money fund assets as of May 31, making it the world leader, according to Crane Data LLC, a research firm based in Westborough, Massachusetts. The entire euro-denominated money fund industry has about 108 billion euros, Crane Data’s statistics show.
Effectively, the European money market industry is now closed and only redemptions will be allowed as nobody can make "money" in money markets in a Zero deposit rate environment. As another reminder, there are hundreds of billions in residual cash in various European money markets which is no longer welcome. Which then begs the question: as the cash is unwound will it go into:
i) stocks
ii) bonds
iii) mattresses
iv) breaking the Swiss National Bank as everyone buys CHF and send the nominal yield on the 2 Year Swissie to -#Ref!
v) gold
We will find out soon enough.
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Goldman was late to the party ...
Nothing to see here...private sector "Doing just fine"
WAR.
Buuut... did they really say "Unchartered" territory? Because that would make zero fucking sense. The term is "Uncharted" territory. A typo on Tyler's part is of course forgivable. A typo on a major Goldman press release on the other hand, just reinforces what we already knew: These guys are neither the best nor the brightest.
GOLDMAN FUND MEMO: EUROPEAN MARKET IN `UNCHARTERED TERRITORY'
so was the "uss minnow" and we all know the story from there.
I think Euroland is about to be in LTRO9.99 territory. If all the underfunded banks now have yet another bank run because people can't make any interest on their fiat, it spells higher leverage and more risk. Unwind in stocks from the banks, but if the Muppets know this they will grab stocks at the nadir. Personally I'd go for option v)- gold, but WTFDIK?
Gold & Silver, cocksuckerz!
10% stocks 90% gold ;)
So was Henry Hudson and we all know what happened to him.
Do I have enough time to pack my evening gowns?
Took a second, LOL, good one.
if you must.
but i'd kinda prefer clothing sewn from fronds and fig leaves and such.
leave room to sew in barbarous relics.
she could hide them inside the two coconut halves.
.
edit: nah, first place they'd look.
or green shoots?
+ Ginger
+ Maryann
Maryann all the way.
It's unchartered because it was only supposed to be a 3 hour tour... Welcome to Gilligan's Island were we are all shipwrecked now...
well, from the point of view of the squid, it might really be outside the charter usually bestowed to a CB, therefore unchartered.
Supposably that's what they mint.
/sarc misspell
I keep seeing these misspellings & misuses of every day phrases. It's almost like our educational system is failing us somehow ...
"It's almost like our educational system is failing us somehow ..."
For all intensive purposes, I think its working just find.
/common blunders
If I loose more money, I might have to move to Columbia.
/my 2 favorites
You should have ended that sentence with an explanation point.
That one is more then common.
Too bad people take it for granite. Or am I making them the escape goat?
Its really a mute point anyway.
Bernie Madoff was a pioneer in unchartered territory. After all, if he'd had a bank charter, he'd have just been bailed put.
Of course. Because the best, the brightest, and the hottest work for Bloomberg financial news.
Here's one of them, Sarah Eisen, so bored to be earning the big bucks pimping for the mainstream media that she is apparently caught, on camera, playing with the huge, black strapon under her skirt? Really? Really?
http://www.dailymotion.com/video/xquxle_reporter-caught-off-guard-with-s...
The ramifications of this are simply preposterous.
Of course, every "conspiracy" needs an "official explanation." Here it is:
http://www.allvoices.com/contributed-news/12173898-news-anchor-sara-eise...
First, the other reporter's mic was malfunctioning, not Sarah's. Second, do they really believe that readers would think that she would have a microphone between her legs or have to hike up her skirt to fix it? Third, the piece mentions nothing about a strapon, which this image clearly represents. Of course, the piece offers no image.
It's important why? Because it shows how blatantly the mm lies. Can you not see it? The chick got caught playing with a strapon, and the spin is utterly ridiculous.
thanks to govts assuming all of their bad debts, why yes, it is
The intervention (manipulation) of the market by the ECB will have consequences in several respects. The decision is correct and GS is one of those consequences. The economic outlook continues to deteriorate in Europe and U.S. will have its effects. Wall Street has taken note of this. Today comes back. This situation will cause movements in the stock market. If we listen, we can benefit economically. Will be one of those few great opportunities.
This could be serious: 2PM and not a ramp in sight.
How can I as a designated Muppet offer up what little wealth that I have to the mighty Squid'n Whale?
I could also do a kidney, heart, lung, liver if say Paulson or such or family need a sacrifice. My family would be so proud.
Spam!
Spam and Reese's PB cups
<---VI) silver
<---VII)Gold ,silver, and mattresses.
<---- VIII) food water lead
Too many options and too few arrows.
<---- IX) Obama's stash
:(
IX) <----- Green technologies creating thousands of billions of new jobs
X) <------ Campaign contributions to Obamney
XI) "Corzined"
XII hopium.
<--- XIII) Hookers & Blow
<--- XIV) Additional Secret Service Protection (aka Hookers & Blow)
<--- Ammo
Aaaaaaaaaaaaaaand it's gone.
http://www.youtube.com/watch?v=NmFo-LKHGY0&feature=related
No, they didn't use the illiterate "unchartered" when meaning to write "uncharted" did they? What's next, using "loose" when meaning "lose"?
I though the whole idea of the EU is to make the territories unchartered... I mean uncharted.
GoldmanSquid, JPMorque and all the feeders off the mammary gland of the nanny-state (funded, mainly through collateralization of taxpayer debt slaves, current and future born) need to create an EPIC Hank Paulson "Tanks in the Streets & Martial Law by sunrise if we don't get more heroin, only this time provided to us on a massive, global, unprecedented scale, in the form of GLOBAL TARP/TALF/QE/KITCHEN SINK DOLLA' DOLLA' BILLS, YO" moment.
Look for really scary proclamations and dire warnings from the Too Big To Fail (but too f*cked up to truly fix) racketeers/junkies in increasingly ominous and alarmist volume over the coming days, weeks, until they get want they want.
Just like last time, if it takes quote stuffing-to-bidless markets to scare the 401(k) bagholders into phoning/emailing their "elected representatives," they'll take the indices all the way DOWN TOWN.
I remember Hank:
WASHINGTON, D.C. -
For Henry Paulson Jr., a Goldman-sized tax loophole awaits his pleasure.
He has amassed quite a fortune--a roughly $700 million equity stake in Wall Street's premier investment banking house. And soon, he will have the chance to diversify a good chunk of those holdings without paying a dime to the Internal Revenue Service.
By accepting the Treasury post, Paulson is poised to take advantage of a tax loophole that allows government officials to defer capital gains taxes on assets they have to sell to avoid a conflict of interest, as long as the proceeds are reinvested in government securities or a broad array of mutual funds approved by the government within 60 days.
http://www.forbes.com/2006/06/01/paulson-tax-loophole-cx_jh_0602paultax....
Ya' know, I'm glad you elaborated on Hank Paulson, or Hank the Tank as I know him.
Since the fix was in, he should've skipped the elaborate dog and pony show he put on (Martial Law, tanks in the streets, mutant strain of airborne herpes, etc) and went with a 1 cue card presentation to Congress that had no more than 7 words scribbled in crayon and a child's drawing of a monster on it, when asking for Wall Street Banksters Big Blank Check, and just made a really scary face while screaming "A-Booooga-Boooga-Booooga!!!"
Think of all the "french benefits" fo such a decision! Irregardless of spelling... Or actual words...
It hasn't impacted me yet.
Your being way to demanding.
You're.
Too.
That was intentional right?
l, r
I don't think the grammar/spelling police are gonna be any more effective...or is that affective...
yes
Seems like the ECB just just pulled the fire alarm in a crowded theater?
pods
And why did this happen before markets closed instead of the usual? Some is losing control (or loosing it if we need to be in on their spelling)
Don't really know. Maybe they are really not in control?
And now with so much "liquidity" running around they are trying to stabilize it while directing it to the areas they want.
But with so many variables, they will undoubtedly make a mistake and blow the whole thing up.
This makes sense with the article yesterday about was it Finland that moved the deposit rate negative.
People are not going to want to suffer the dislocations of so much funny money chasing yield.
pods
They never were nor will be in "control" per se, but they can pretty much pinpoint when they want the thing to blast off or crater... If the thing takes a shit, presume that TPTB wanted it to at the exact moment it does... the only question for us is why now and why this direction (up or down)?
My take is that muddling through is killing everyone. We'll get a controlled demolition until some point at which the waters are safe for uber-overthetop-super QE... which will coincide nicely prior to the election in November. I think we basically "U" shape from here.
Whether or not QE xxxxxx^10, in and of itself, spooks the herd is anyone's guess.
Goldman not pleased it would seem.
Perhaps this was not OK'ed.
why anyone would allow wall street to hold their near-cash i for a lousy 5 bps instead of having it federally insured or in a mattress is beyond me.
They're not called "muppets" for nothing.
You forgot...
vi) guns
http://globaleconomicanalysis.blogspot.com/2012/07/finland-threatens-to-leave-euro-rather.html
Just wondering if this means they are actually opening loads and loads of money market funds. Btfd in money funds?
vii) IOU's
GREEK VOTE OF CONFIDENCE SUNDAY NIGHT...............................................
http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_30546_06/07/2012_450801
There is no one left to vote
From your link, see below:
More News Motorcyclist hurt in knifepoint mugging Troika acting like ?conquerers,? party leader says PASOK leader heralds party overhaul Church soup kitchens to run through summerThat sounds so just wrong.
Greek vote of confidence.
a) Yes, I like it
b) It's better to give than to recieve
c) Ewwwww
d) Bend that German over again
e) Why me?
Doesn't this lead to liquidity crunch for institutions that rely on MM funds? Worst case, runs?
More like the screaming mimi's (sp?) really.
Either way, being long gold might not be the way to go short term.
The Mexicalis
Anyone, besides me, having that feeling just like when LEH and BSC went kaput? Perhaps some weekend emergency meetings and Sunday evening announcements?
yup. rivets popping on the bulkhead....
Abstavitively...
Look at the Kitco chart for the last 3 days.
Like clockwork, same time, same Bat Station, whammola
They're seemingly in something of a contain the shit no matter what mode.
Maybe not this weekend, but seemingly getting worser and worser.
Also, I'm getting the tone from friends and acquaintances in the biz... bad vibes. Just plain bad mojo. The official lines are the same as always, the individuals are chafing at the collars keeping them in line.
I've told them that I don't see it as very bad right now but that's because I'm in the gonna get one hell of a lot worse camp. Like ya'll ain't seen anything, yet.
And might even be a prolonged period of water torture, drip by drip.
What the fuck do I know?
Who knows?
This is when I'm glad that I'm in safe stuff.
Like talking with clients, etc.
How does one measure risk these days?
By how well one sleeps.
Shhhh Shhhhh it will be ok.... Just sleeeeep
Meanwhile, retail stocks are surging again today, and gold stocks are imploding.
The U.S. Consumer is totally unfazed by Europe, job market, etc. They are still spending come hell or high water.
http://www.wallstreetbear.com/board/view.php?topic=102940&post=374580
Because "Risk Off" simply means crashing commodity prices which translates into a huge tax cut.
Well from my POV, first you have to have a few garments if you want to start sewing your gold into the hems...
Classic
If they're smart, gold.
May not be available soon. Tyler's earlier post: http://www.zerohedge.com/news/thunder-road-report-death-march-approachin...
Devaluation in Western currencies are comng and the only protectin is PM's
Solar powered bathsalt production plants.
Next up will be rocksalt.
Perhaps human flesh powered? That's when things get interesting.
no thank you ...
Market skimming right along support can't get it up. Volumes dried out, waiting to see a big green Fed Stick lmao. Not looking to fresh at the moment, failed bull flag, a break of SPY 135 and we'll have a -300 day on our hands. Could happen any minute.
Your friendly drunken trading update. Yeehaw.
getting close to false flag distraction time.
a puppet show which will rip apart and kill real brown innocents.
depleted uranium us,uk nato missiles locked and loaded
death and distraction
war and reset
one of course always hopes this is simply not how bad it is getting, but history does not lie, does it?
3.4 million job openings, 27-34million need living wage jobs. Which is faster, increase jobs or rapidly reduce population?
I suspect war... It is the only natural population control left.
if by "unchartered" they mean: "this is fiat activity too far, it is beyond what can be rationally chartered thereof," then nm.
If they mean uncharted, then go watch gilligan's island until you get the diff right: the passengers CHARTERED a ship for a three hour cruise but got stranded on an UNCHARTED island getaway.
+1. What is it with some people having to poncify their words e.g. backwardation => backwardisation. So much more credible-sounding.
Ummm.. If the ECB is paying 0%, shouldn't gold be a strong buy? Granted, there are costs to storing gold, but they are not that high and, what is more, there is no risk of governments renegging.
Gold should be through the roof.
and it is lower today, so use the discount and buy some more.
They should short the eur/usd.
Only safehaven will be paid up property you can rent by the room for a day or night and ability to feed yourself. Amazing how fast gold becomes available for a bite to eat. During depression Ford cars were sold for gold watches, and I dont mean Rolex's. A good supply of gold does help---just in case
The closing of these MMs means there will be capital inflows into ...
Treasuries and Bunds.
That is all.
Wow, talk about no volume. Not enough to break lower that would be a real event for this time of day. I'm still waiting to see if they can float this POS up the last hour. No wait, scratch that. It's not worth fucking with im getting another beer. LMAO.
This just means that the UST, Gilts, Bunds and JGB bond bubbles get that much bigger.
When these suckers eventually pop, it will be something to see.
bullish!
Between you and I, Goldman, the affects of a grammatical misstake such as that cannot be understated and doesn't jive with the way press releases should be prioritized.
It doesn't "jibe." It's fucking jibe!!!!!
You're response doesnt jive with the intent of my post.
+1 Well done! You haff made ze Mysteerious Rooshian Vooman laff.
Riots in 5, 4, 3...
"we can't see how a MMF in Europe doesn't break the buck under this scenario".
September 2008 redux.
If the forest fires and the Free Radicals don't get ya Children,
There' always the Derivatives Market....
As the Economist points out:
Authority (FSA) in Britain and America’s Department of Justice, Barclays accepted that its traders had manipulated rates on hundreds of occasions.
And the idea that one party’s loss from the manipulation was another’s gain is irrelevant to those on the losing side:
I expect the firms involved to face a locust swarm of litigation. Lawyers may accomplish what regulators and politicians refused to do: strip the banks of ill gotten gains and bring their preening CEOs and “producers” down a few notches. A day of reckoning may finally be coming. (www.nakedcapitalism.com)
The Economist, like the WSJ in USA, has been the greatest proponet of Big Bang Thatcherian economics that hatched this monster of City. She is the original queen bee mother of an ideological revolution that has turned a nation state into a casino state all centered around the City; just like Ronny did with WS.
Having trumpeted for three decades this economic philosophy of corpocracy, Oligarchy haven, based in London, these same media shills, uber sophisticated paragons of free market enterprise, pretend they HATE the resultant corruption now exposed whereas they LOVED the philosophy that nurtured it, right from inception.
As that seminal article here on ZH has shown, you cannot be a supporter of the Creature of Jekyll Island, and then complain about crony capitalism, rampant political/bankster hand in hand corruption, financial scam and monopolist price fixing.
It was written in concrete right from beginning in the articles of that philosophy. As if The Economist didn't know that...turn coats all, following the weather vane.
Why Soros won?
Looking at the strange inverse yield curves of some European debt it seems to me as if the short maturity debt was considered a safe haven bonanza to exploit. Because liquidity in money markets is higher it was an easy bet to buy high yield short maturity debt and sell long term maturity debt. Stupidity of so called rescue crew made this arbitrage easy, knowing that Greece and Italy and Spain were to finance via short maturity debt and as such were easy prey. So the books are closed now.Where does the money go? Well, it is relatively easy to assume that one side of the yield curve is a wee bit undervalued.
They might as well do the same here...MM's "paying" .01%.
Thanks Ben you're a douche
Yes, it will be bitter when they face reality, they were fooled. It was all about bloody easy arbitrage. And the beauty is, politicians will be delighted to show they have managed the crises when there was none in the first place.
Must read, which shows that risk premiums are a theory, well an unproven one.
http://www.paecon.net/PAEReview/issue59/PopeSelten59.pdf
The governments of Europe have made it, in effect, impossible to compete with European governments for cash. See: Argentina.
the USD has been in unchartered territory since 1971. It never bothered GS.
Okay, folks, please help me. Is this real? A Bloomberg finance show hottie caught playing with her huge strapon whent the camera reaches her too quickly because of a "technical difficulty?" Is this really what it looks like, and if so, how does this happen?
Talk about unchartered territory or whatever... dang! That thing looks like it has some, ahem, serious ramifications, some unpredictable consequences, some kind of market shake-up... I could go on?
I just want to know if you all think that this is what it looks like or if you can explain it?
http://www.dailymotion.com/video/xquxle_reporter-caught-off-guard-with-s...
Someone told me that internet excuses were claiming that this is a microphone. Um, I'm sorry, but there's no way Bloomberg is making reporters this hot put microphones this big between their legs. Sorry.
I don't think this is a members only queef cam for paying subscribers, is it?
Bloomberg hotties wear strapons, bitchezzzzz! Bend over and get ready to scream because this thing is huge.
Yikes...
There has also been some news about Money Market funds across the pond (from Europe to US) lately... about letting USD Money Market funds float more freely from $1 (aka let it sink)
i gotta say, it looks more and more like the us of a is gonna come out on top in the whole shabang. ben squeeks by with extending 'twistie', a piddling amount in the face of the rest of the planet. china guesses wrong again and cuts rates trying to use up all that coal they gots. ecberoudoetchagaundteitfraupizza is soooo far f''k'd that toast is its new nickname.
patience ben patience. the bernanke put has to end someday....si?...gentle now is possible....patience ben. patience.
Eat your meat!
http://shutupnsing.wordpress.com/2012/07/07/scaling-the-wall-with-tyler-roger/
THE MUPPETS FIGHT BACK lol
Source: www.IPE.com
I have an interest checking account of over $50,000. I just received my
statement and I was credited with 31 cents interest for the month.
I hope this doesn't mean I am going to lose my monthly interest.
How will I get by?