Europe's Most Parabolic Chart Resumes Climb As German TARGET2 Claims Rise To Just Shy Of $1 Trillion

Tyler Durden's picture

Perhaps one of the best advance indicators of the market respite that took place in August was the slowdown in Bundesbank TARGET2 claims, which until then had been rising at an exponential pace, only to see its first monthly sequential decline since 2011, dropping €1.4 billion. Now that August is gone, and the vacation that brought Europe to a merciful halt is over, the time to resume sucking Germany dry in order to fund current account (and other) deficits is back, and sure enough the just reported Bundesbank August update of TARGET2 claims shows that the increase is back. At a record €751.4 billion (or just shy of $1 trillion at today's exchange rate), Germany funded the periphery, mostly Spain with record €415Bn in liabilities, Italy with a record €280Bn, Greece at €105Bn, via the transfer of public risk to private sector benefit (sunk "public" Buba costs are a concurrent benefit to the German export sector) to the tune of over €1 billion each work day, with a total monthly increase of €24 billion in August. Look for this number to resume its astronomic rise as the periphery realizes its inventories needs restocking and that it needs to import German stuff using Bundesbank liabilities that will never be satisfied.

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Colombian Gringo's picture

Europe is fucked, full stop.

Haager's picture

The main problem is that they simply don't stop fucking. 

Rubicon's picture

Speaking of the Swedes, how are they doing?

Dr Benway's picture

Given the dismal birthrates one could conclude there is too little unprotected fucking, not too much. Maybe Assange had a noble purpose with his sexual abuse.

GetZeeGold's picture



Speaking of the Swedes, how are they doing?


They're supporting a generation of Greeks.....stop picking on them.


Rubicon's picture

Im serious. How can the Swedes be doing so damn well when the rest of the world cant afford herrings?

steve from virginia's picture


Keep in mind, dudes, this is circulating currency not central bank (ECB) credit-to-reserve accounts. Flow of funds to reserves is one direction, circulating money ... circulates!


Some is dumped back into the Target2 system when euros are swapped for sterling, dollars or gold. As soon as these find their way into some Spaniard's (or Greek's or Italian's) hands it's back to the Bundesbank for another go-around.


Enough dalliance before the inevitable wipeout and Bundesbank liabilities (in any currency including d-mark) will be greater than the total amount of euros in circulation. (I wonder of the Euro-bosses have thought of that?) 

Aquaman's picture

Just one of a million charts day in and day out that show how bad everything is....and yet here we are trading at four year highs.  Nothing tradable however.

GetZeeGold's picture



Yeah.....that's pretty fukkin amazing.....isn't it?


Dr Benway's picture

Markets are cottoncandy, 1% spin and 99% air, untradable for all except inveterate gamblers and hooked-up insiders.

LongSoupLine's picture

"but, charts that go up means good...right?" - any average American

CheapBastard's picture


Soros via Reuters:

"Germany should either lead in developing a growth policy, political union and burden-sharing, accept the cost of leadership, or leave through an amicable arrangement," Soros said in an interview with Reuters television in Vienna.

 "This policy is pushing Europe into a depression which is going to last five or 10 years," Soros said.


He said this would compound slowing global economic growth.

"I think this whole process is reinforcing the deflationary tendencies in the world, so Germany itself is slowing down and will stop growing," he said.

"China is actually destined for a hard landing, which will reinforce the global tendency towards depression."

No Euros please we're British's picture

Don't worry, Soros will make money out of it whatever happens.

Sandmann's picture


Chief Economist of Commerzbank AG forecasts German economic collapse within 5-10 years