Europe's Firewall Is Insufficient - A One Chart Explanation

Tyler Durden's picture

Unlike Eurocrat rhetoric, which is increasingly full of lies (thank you Jean Claude), prevarications, and half-truths, math is simple and binary. There either are enough numbers, or there aren't. In the case of the European firewall, there aren't (and that is even assuming the IMF somehow manages to convert all the money pledged for a European bailout bailout into money available for disbursement... because there is a world of difference between the two).

Source: Deutsche Bank

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Sudden Debt's picture

It might be me, being a stupid european and all but this graph kind of needs a bit more explenation. It's not really clear who needs what and who gets what. Sometimes they need a trillion, than 1.2 than 3 than 400...

Motorhead's picture

I'm with you.  Not even the St-Feuillien is helping.

Gunga's picture

Switch to PBR long necks, I only needed one to understand the firewall is bullshit.

TheFourthStooge-ing's picture

"Woman like long neck bottles,
And a big head on her beer.
I don't like to talk about my women,
But I hold that woman dear.

Well, one night she got to drinking,
Got out and shot up the town,
I'll be damned if she didn't
Bring an airplane down.
I don't like to talk about my women,
But this one sure could chug 'em down.

One night she started drinking,
Down by the river.
She dried up the river,
And backed the ocean down.
I don't like to talk about none o' my women,
But this one sure could hold her long neck bottle o' beer down.

When she walked into a bar,
They set 'em up and got right out of town.
'Cuz she picked 'em up a plenty
And she laid a lot of them down.
Woman like long neck bottles,
And a big head on her beer.
Now you got that down,
You got that down."


CPL's picture

As a nonsense powered Canuck the explaination is simple.  Currency is no longer valued against anything real and when folks click in once the tsunami of worthless credit is indeed determined as's going to be a mess.

malikai's picture

I can further summarize. Buy FB.

old naughty's picture

and its a massive mess...

echoing Reese Bobby below.

Lord Blankcheck's picture

What's a financial firewall?


pure BS

Zero Govt's picture

a firewall is a new word to tag another hastily arranged sack of cheap money to bailout the clowns that blew the previous sacks of cheap money termed 'rescue' and 'bailout' and 'fund'

wordplay, smoke and mirrors, all to mask politicians are a fuking sick joke 


TheFourthStooge-ing's picture

A firewall is a garbage bag full of paper in the basement of the Greek Finance Ministry.


CPL's picture

With fiat defended only by ideas instead of what it represents, unaccounted for debt on productivity so far in the distant future it represents nothing to anyone alive.

The only firewall that can be applied is denial.  Fixing the debt with more debt, is odious, using the world stage as the platform to manage it all...evil is a good word.

itstippy's picture

A financial firewall is an enormous pot of pledged government money that's ready to deploy instantly to crush anyone who dares question the stated book value of worthless shitass toxic garbage securities (WSTGS).

It's like having a bazooka in your pants.  If you've got it, and the bond vigilantes & hedge funds & speculators know you've got it, you'll never have to use it. So the pledged government money never actually gets tapped, and taxpayers' wallets are safe.

Hank Paulson can explain it better than I can.  With a financial firewall in place, taxpayers can sleep peacefully at night knowing Financial Stabeelitee is assured and they won't get screwed by unscrupulous speculators and confidence artists. 

Dre4dwolf's picture

Financial Fire Wall, is a similar to a furnace, its where you throw all the paper and worthless currency when its no longer worth trying to save.


In this case, the furnace is too small, as such construction of a larger furnace is needed .

Reese Bobby's picture

I would argue you need to include the bank refunding needs in the PIIGS as well.  And throw in France while your at it.  They're gonna need a much bigger boat.  So big it sinks.

Joe Sixpack's picture

"math is simple and binary. There either are enough numbers, or there aren't."


I have to disagree with you on that one, Tyler. Math can be used for lying- it's called statisitcs, and governments are full of ministries pushing out statistics.

Atomizer's picture

Obama administration is just another ‘Footman” to sell candy. Candy in which you cannot afford.

Dr. Engali's picture

So I was in my apartment making beer one day, when a nazi goon squad came barging in. Now I live in a luxurious resort at guantanamo.

q99x2's picture

Looks like there is less than half a decimal point there. That Gang of eight that met this week shouldn't have any problem in printing that. Especially if their jobs depended on it. What the hell do they care.

midgetrannyporn's picture

Fuck the firewall let it burn.

RoadKill's picture

Headline is right but chart is total BS.  The "firewall" is ALOT less well funded then shown.

You have to look at the source of funds and ask who is really going to be able to pay - both fiscally and politically.  All of a sudden a lot of funds disapear.  Same thing with the IMF.  Please show me the E350bbn in a warchest somewhere the IMF can tap without contributions from the USA (which will be blocked by Congress).

But the biggest understatement is the funding needs.  This analysis pretends that funding Italy & Spains deficits for the next 3 years would be sufficient.  HAHAHAHA.  You have to fund their deficits, their debt rolls, their banks as deposits flee, and you have to fund their business borrowing needs if you have ANY hope of stopping GDP from plunging 25%.  And what about the needs of the "donor" countries?  Germany and France both have to rescue their own banks from the cuts to soverign debt they need to recognize.  I'd guess you are underfunded by TRILLIONS of euros not hundreds of billions!

insanelysane's picture

Like I said last night the debt needs to be vaporized as there is no firewall large enough to bring us back from the edge.  Someone replied to my comment that retirement funds will suffer.  Unfortunately this is the type of thinking that the government wants.  The reality is that retirement funds and whomever is holding the paper from these countries have suffered, they just haven't realized it yet because of the way it is accounted for.  All of these banks are already bankrupt, they a running on fumes, and every LTRO, Twist, QE, merely gives them another few days.  The hedges, CDS, etc are with each other and the NET, NET is negative for pretty much everyone.  Vaporizing the debt just makes the accounting clearer instead of tying everything up in courts trying to determine what default events are and are not.

valley chick's picture

but...but...but...they just had a G-8 meeting and all is fixed. 


Piranhanoia's picture

1st bar is the current  pretend money ready to spend, 2nd is what is promised if they can steal it,  3rd what would be left if they steal it,  4th is the fictional IMF excess pretend money, (if the ECB can't figure a way to steal it)  5th is the fake total of fake money all in one fake pot,  6th is the smallest number they can pretend the PIG weighs in Euro's.   Please be advised that none of the above is true, real or possible;   Yours truly,   DB

sitenine's picture

I would have helped had they not built the firewall out of paper.

Seriously folks, what's the flashpoint of paper?

Amish Hacker's picture


So they wait till now to tell us the lifeguard can't swim?

gatorengineer's picture

You forget the most evil force in the universe..... Benny and the Jets (ink Jets that is), Chart makes it look like its a few hundred billion short.  Thats easy for benny, wouldnt even blink, doesnt need congresional approval.  yada yada yada...

The only thing in my view is needing a LITTLE political cover to hit control P....  markets flat to 5 percent down for the year aint it....

The question is, do we get a gradual decay, like we have seen for the last two weeks, or a catostrophic event that might be too big to print....

The Greeks also really need to be made to at least superficially cooperate as well.




worbsid's picture

I'm re-reading "Hitchhikers Guide to the Galixy" ... The fellow I really like there is the Pessimistic Android.  "Of course it will fail. Die leute sind nicht verdammt gut."  People are no damned good.

Caviar Emptor's picture

All that is needed here: One bailout, one scotch, one beer. 

WmMcK's picture

Georgie says swap the bailout for a whiskey and it's a deal.

nmewn's picture

lol...the rent lady can wait at this point.

The4thStooge's picture

She said "You got my money?"

I said "No!"

Alexandros's picture


...the unworthy Europeans, who in 1945 “took Europe down” from “Mount Olympus” and in 2012 relinquished “enslaved” Europe to the Phoenician loan sharks.


World War III - The first private war in history

Those who won all battles shall lose the war.

TheFourthStooge-ing's picture

Fuck off, copy and paste wanker.

You are the anti-genius of Greece.


Bag Of Meat's picture

No1 reads your BS bro, get over it

SqueekyFromm's picture

Well, if Europe is only short 400 billion dollars, or E thingies if the chart is in Euros, then that is doable. First, they lure Zuckerberg, Buffet, Gates, and a few sheiks to France for a party, then slip them each a rufie, and hold them for ransom in the sewers beneath the Opera House. . .

After they get all their money, they turn the "job producers" loose and in no time they will be back as rich as before, even if they have to start off at minimum wage at McDonalds, because they are all sooo smart and stuff.

Squeeky Fromm, Girl Reporter

luna_man's picture



Just gettin DEEPER and DEEPER!...

Keep it comin...MY MAIN MAN!...


only you!

WallowaMountainMan's picture

they are quantdominos. not firewalls.

turns out germany is best off with a greece default. sure it costs them big time up front, but after the fall of the euro, germany has access to cheaper labor/material for germans to manage.


costs drop, offsetting the german dollar thing getting stronger.


Nussi34's picture

Any firewall is insufficient as long as the source of fire (the Euro) is not extinguished.

luckylongshot's picture

The true source of the fire is the privately owned fractional reserve banking system. Noone wants to talk about this as it means the problem is a systemic one and so cannot be solved by using the available options within the system. Simply put there is too much debt and it has triggered a dominoe collapse that is unstoppable. Firewalls are as useful in the face of this tsunami as tsunami walls were in Japan last year. Where the discussion needs to be focused is on what we replace this current system with and we are nowhere near talking about this so all we can do is watch the dominoes continue to fall.

timbo_em's picture

Ctrl+P is the only 'solutuion'!

Somehow funny that it took the banksters' brain trust so long to figure that out. Italy and Spain have more than 2500 bn euros of debt (only official Eurostat numbers without derivaties or contingent liabilities) that they have to roll over approx. every 6.5 years. They currently pay 3.5 percent interest on average. This results in financing needs of almost 500 bn euros per year.

ps: It took my five minutes to figure that out...two years ago!

cnhedge's picture

what the economy can tell us about the election

Is the Euro area Credibly on Target?