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EURJPY Falters As ECB's Weidmann Suggests Savior Of Last Resort Won't Be There

Tyler Durden's picture




 

Speaking at the EuroFinance conference, the recently chatty Jens Weidmann makes it clear that expecting the ECB to save the day is not a good idea. His comments, via Bloomberg, were enough to crack EURUSD under 1.37 and take EURJPY below Friday's lows - dragging risk assets lower across the board.

*ECB'S WEIDMANN SAYS ITALY HAS `WORRYINGLY' HIGH DEBT BURDEN

 

*WEIDMANN: ECB MUST NOT SOLVE SOLVENCY ISSUES OF STATES, BANKS

 

*WEIDMANN SAYS MARKET FORCES HAVE `IMPORTANT DISCIPLINARY' ROLE

 

*WEIDMANN SAYS USE OF MONETARY POLICY FOR FISCAL NEEDS MUST STOP

Italian 10Y spreads are almost back to unch after being 11bps tighter at their best.

Chart: Bloomberg

 

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Mon, 11/14/2011 - 05:51 | 1874977 ThatThatcher
ThatThatcher's picture

I think it's become abundantly clear that the hope that the ECB would not become the lender of last resort has faded. Quickly. Thursday's 1 year BTP auction was a farce.....................

Mon, 11/14/2011 - 07:32 | 1875060 Popo
Popo's picture

It's amazing to me that underlying all of this is the belief that declining markets are somehow "bad". 

How on earth can any true capitalist believe this?  A market is *meant* to hand your ass to you if you do something stupid. 

The notion that the ECB, or any central bank has any business preventing a declining market is completely 'off the charts' insane.  A market is a mechanism for price-discovery, period.  If idiots are not taught a lesson by Mr. Market (ie:  if the market is artificially stimulated) the only thing that will be accomplished is an increase in the number of idiots.

Let. Shit. Fail.

Mon, 11/14/2011 - 08:46 | 1875144 trav7777
trav7777's picture

stop being so rational.  it's not fair for people to lose money.

Mon, 11/14/2011 - 05:53 | 1874979 misterc
misterc's picture

Bla bla bla. Print they will. You can bet the farm on it. 

Mon, 11/14/2011 - 06:42 | 1875017 topcallingtroll
topcallingtroll's picture

Never underestimate the joy germans receive from suffering.

My god! Ninety percent of BDSM fetish porn is german.

Mon, 11/14/2011 - 08:47 | 1875145 trav7777
trav7777's picture

there's an entire TV channel mostly devoted to reinforcing their perpetual guilt

Mon, 11/14/2011 - 21:25 | 1877780 smiler03
smiler03's picture

Which is?

Mon, 11/14/2011 - 05:57 | 1874981 Rip van Wrinkle
Rip van Wrinkle's picture

Wow, someone who gets it!

How long do you give him?

 

Mon, 11/14/2011 - 06:14 | 1874995 reload
reload's picture

Not long at all. There is a GS `advisor` already lined up to replace him following the imminent discovery of kiddie porn on his home computer.

Mon, 11/14/2011 - 06:06 | 1874988 The Swedish Chef
The Swedish Chef's picture

Isn´t there a spagetti auction later today? That will be interesting to watch...

Mon, 11/14/2011 - 06:10 | 1874990 Dick Darlington
Dick Darlington's picture

*ITALY SELLS 2016 BONDS AVG YIELD 6.29% VERSUS 5.32% ON OCT. 13

*ITALY 2016 BONDS BID TO COVER 1.47X   VS 1.34 ON OCT. 13

*ITALY SELLS EU3 BLN OF 5-YEAR BONDS AT 6.29%, MOST SINCE 1997

Nov. 14 (Bloomberg) -- The following issue went on sale today:

Issuer:                  Government of Italy
Manager:                 Bank of Italy

Type:                    Bond
Amount Tendered:         4.406 billion euros
Amount Allotted:         3 billion euros
Bid to Cover Ratio:      1.47
Average Price:           94.03 percent
Average Yield:           6.29 percent
Coupon:                  4.75 percent
Maturity:                Sept. 15, 2016
Settlement:              Nov. 16, 2011

Mon, 11/14/2011 - 06:58 | 1875035 Snidley Whipsnae
Snidley Whipsnae's picture

Yeah, we know 'the government of Italy' issued these bonds, we see the other specifics; ie, amount tendered, etc...

What we don't know is who bought the 4.06 billion euros of bonds...

Anyone care to hazard a guess?... and, not 'direct' vs 'indirect'... I'm talking specifics.

Since we can be fairly certain that no sane individual investor would put up money for this bond offering we are left with soverigns or central banks... which are quickly becoming the same thing.

Hey, for all we know the US Citizens might be the purchaser via the Fed.

Mon, 11/14/2011 - 07:20 | 1875050 Mike2756
Mon, 11/14/2011 - 07:10 | 1875044 Dick Darlington
Dick Darlington's picture

Aaaand after auction:

*ITALY FIVE-YEAR NOTES EXTEND DROP, YIELD JUMPS 12 BPS TO 6.58%

Mon, 11/14/2011 - 07:14 | 1875045 Irish66
Irish66's picture

oh boy

Mon, 11/14/2011 - 06:10 | 1874991 Cassandra Syndrome
Cassandra Syndrome's picture

But, but, but, Italy was annexed by Germance and Il Duce 2.0 was appointed leader. Everything was sorted, right? 

Mon, 11/14/2011 - 06:10 | 1874993 disabledvet
disabledvet's picture

From Bailout Nation to BAILOUT WORLD BABY! "What do we want!"..."Ten TRILLION!" "When do we want it?"..."NOW!" Now get that Kernan guy on this PRONTO!

Mon, 11/14/2011 - 06:37 | 1875014 topcallingtroll
topcallingtroll's picture

I have never understood why this is so hard.

Cut government expenditures thirty percent, primarily transfer payments from the productive to non productive.

Assure the population no one is allowed to starve.

Kill a bunch of rioters over the next month, the ones intent on disruption and destruction. Peacefull protests always tolerated. A few hundred anarchists dead will deter the others. Shoot on sight without warning any person with a molotov. Of course a few mistakes will be made, but a few dozen innocent killed accidentally in a country of thirty million is nothing.

Why is that so hard? Isnt it better to get it over wirh now while the situation is semi controllable?

The fewest number of people suffer this way.

Mon, 11/14/2011 - 06:42 | 1875018 Reptil
Reptil's picture

I don't think you've been to Italy yet. :-)

Mon, 11/14/2011 - 08:48 | 1875148 trav7777
trav7777's picture

compound debt can no longer be repaid.  I assume you can do math

Mon, 11/14/2011 - 06:40 | 1875016 Reptil
Reptil's picture

It seems, finally the germans are on to te game. (that Italy can't make it, under these conditions, and they'd be "helping them" perpetually.)
This outweighs the nice trade relationship between Italy and Germany for sure. ooops walked into a debt trap.
I'm sure putting a straight up Goldman Sachs guy at the helm raised some heads in Frankfurt.
Currency wars heating up. What will be the counter move?

Mon, 11/14/2011 - 06:48 | 1875025 Tao 4 the Show
Tao 4 the Show's picture

Let us hope so (about raising some heads). Why anyone would think these bankers have even the capability of looking out for ANYONE's good is beyond me. The minions think they will be blessed as the water carriers of the elite. They are so, so wrong. As the 60 Minutes show just demonstrated, they will be thrown under the bus as expediently required. No mercy means no mercy to anyone. When will idiot humans get it through their heads that joining the dark side provides no salvation, even in this world.

Mon, 11/14/2011 - 07:04 | 1875041 slaughterer
slaughterer's picture

The dark side are not looking for salvation.  The are simply looking for power and capital gains.  Only mass protest and litigation will take them out. 

Mon, 11/14/2011 - 07:14 | 1875046 Tao 4 the Show
Tao 4 the Show's picture

Agree. What I meant was that the PTB always need a second and third layer to execute their plans. People in those layers think the PTB will protect them because they are willing servants. In reality, they will be disposed of when useful to the PTB to do so. No mercy.

Mon, 11/14/2011 - 07:10 | 1875043 Snidley Whipsnae
Snidley Whipsnae's picture

"Why anyone would think these bankers have even the capability of looking out for ANYONE's good is beyond me."

............................

The bankers are sociopaths and are definitely looking out for their own good.

The citizens of the US totally misunderstand the current situation. The citizens still believe that the US gov and Wall St are working for the best interests of America and American citizens... but this simply is not so.

Hunger will be a big wake up call and motivator. America is on the fast track to third world status...

 

Mon, 11/14/2011 - 07:19 | 1875049 gianakt
gianakt's picture

Chinese spotted selling Euro's on heavy volume!!!

Mon, 11/14/2011 - 07:39 | 1875066 reload
reload's picture

link to source please.....?

Mon, 11/14/2011 - 07:41 | 1875067 williambanzai7
williambanzai7's picture

You mean shatty, not chatty.

Mon, 11/14/2011 - 07:49 | 1875073 Dick Darlington
Dick Darlington's picture

Listen to the official propaganda from EU-dictatorship after placing two of their own, unelected sock puppets to "lead" Greece and Italy and dismissing the ELECTED governments.

*EU COMMISSION SAYS SETTING UP GOVERNMENTS `A NATIONAL MATTER'

Uh huh...

Mon, 11/14/2011 - 07:52 | 1875074 Georgesblog
Georgesblog's picture

People can argue about whether ot not there is a Savior of last resort. The system of unjust weights and measures is an abomination, willful rebellion for which there is no forgiveness. Central banks can restore that which they stole by fraud, or take their just reward. Debt brings poverty. The currency is the lock on the prison gate.

 http://georgesblogforum.wordpress.com/2011/11/02/the-daily-climb-2/

Mon, 11/14/2011 - 08:50 | 1875154 trav7777
trav7777's picture

for most of the past 1000 years, being in debt was considered tantamount to sin

Mon, 11/14/2011 - 08:33 | 1875121 Tense INDIAN
Tense INDIAN's picture

its not his comments....EUR was supposed to come down anyway....the dollar is doing this PARALLEL channel....in the 30 minutes...I posted in the morning when the dollar was just resting on that lower trend line....The dollar moved up and the INDIAN markets fell....and now others are going down ....The inverse...correlation with the dollar is now 100% .....if u take a look at that chart it looks like the dollar is going to form a HnS or better a DIAMOND .....for this the recent high should not be breaced .....and this will the FUEL behind the NEXT rally which will take the Stocks higher ....and the Snp higher than the last high of 1292...

 

http://markettechnicals-jonak.blogspot.com/

Mon, 11/14/2011 - 08:37 | 1875128 johngaltfla
johngaltfla's picture

That isn't a falter, that's a collapse. If 105 doesn't hold there's a lot of air down to 102. After 102 it's market crashy-crashy time.

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