EURUSD Opens 100 Pips Lower On Latest Round Of Greek Default Fears

Tyler Durden's picture

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unky's picture

Last monday we already hit 1.3499. So it still seems OK now, I guess.

 

By the way, did ZeroHedge report the limitation of swiss banks to draw out cash. This applies for German citizens, as of now (due to new tax agreements between both governments).

GtownSLV's picture

One of my favorite charts. There's a little support at 1.352, then 1.270. A nice Bernanke bitch slap to the FED when they dillute the shit out of the dollar and it still's going up. Isn't it about time for another bailout rumer?

http://www.fxstreet.com/rates-charts/live-charts/

Djirk's picture

hmmmm since all the euro dra(ch)ma has been going on for months, one would assume some default risk is priced into the EU/USD. So when there is  real news and/or a resolution, the dollar may be fjucked  EU/USD ...2????

 

Funny how after the EU drops, it magically arllies when the US markets open? Ben you out there? China trying the same buy debt, sell goods, then try to buy assets on the cheap strategy?

Eally Ucked's picture

It looks to me that ZH got overrun by 1 sentence (irrelevant) trolls. They just dilute the content with their useless statements and pseudo thoughts. Oh, well success has some price, not to mention paid trolls.

Hulk's picture

It is boring as hell. Been eating popcorn for almost 4 years now...

runlevel's picture

could you imagine 4 years worth of popcorn all in one kernel... KABOOM!!!!!!

Hman's picture

It must be a Keynesian corn your eating ...

Hansel's picture

+1, I've been bored for quite a while.

X.inf.capt's picture

can we get this over with, please

Zero Govt's picture

always takes longer than you can ever imagine ...this banking collapse, like the recent stock market rally, is like water torture or waiting on your luggage at an airport.. you know it's going to happen just takes forever to freekin arrive!!

C'mon bwankers just fall on your sword you old stupid duffers

Spirit Of Truth's picture

Even in 2008 it took weeks and months for the obvious to unfold.  Bear Stearns went down in March and it wasn't until September that Fannie, Freddie, Countrywide, Lehman, etc. went belly-up:

http://en.wikipedia.org/wiki/Late-2000s_financial_crisis#Financial_institutions

What's more, even as the collapse unfolded, there wasn't a full panicked response in financial markets until October.

This is what I'm trying to highlight here with my blog on the seasonality of mass panics.  While the pieces are all in place, the timing of the full-fledged panic apparently abides by seasonal parameters.  This has occurred time and time again throughout history, e.g., 1857, 1869, 1873, 1907, 1929, 1939, 1962, 1973, 1987, 1989, 1997, 2001, 2008.  In all of these years the ingredients for the eventual panics came together over months or years, but the acute phase of a break in collective mood and confidence did not strike until the proper seasonal moment in September/October:

http://thespiritoftruth.blogspot.com/2011/09/autumn-panic-update-will-civilization.html

Seize Mars's picture

It is boring as hell. Been eating popcorn for almost 4 years now...

Bored of Trade? Heh heh

buzzsaw99's picture

perfect timing. fomc tues & wed.

mkanterm's picture

I have said this before and I reiterate my thesis that either the weaklings are going to be shot out of the Euro in a massively costly Lehman-like event, or, as modern economic theory would predict based on game theory and what not, they would come closer together fiscally and politically, with the EFSF taking the role of an EMF (IMF like institution for the Eurozone), in effect creating a European treasury to issue Euro-bonds, and thus instituting a blue-bond, red-bond plan where x % of a country's financing is European and y% is domestic, thus limiting debt by market rates but at the same time providing a backstop of European credit quality for the majority of debt, implying that the x% would be greater than 50%, probably somewhere near 65-70%.

So Close's picture

The current hole in your theory is that what the market is pricing Greek debt at is different than the interest they are paying.  It is the resolution of that issue on which everyhing hangs.  Right now the answer is German taxpayers are making up the differance.  Something must give.

Cdad's picture

Correct.  We need not wait to hear from Germany that it likes blue and red bond plans.  Neither do we need DSK to tell us that Greece is done.  The market has already spoken.

That politicians pretend it hasn't is simply the extent to which everything becomes more expensive on the way down to nothing.

And those waiting for Ben Bernanke to bail out Europe simply have NO IDEA what is truly going on.

mkanterm's picture

I have said this before and I reiterate my thesis that either the weaklings are going to be shot out of the Euro in a massively costly Lehman-like event, or, as modern economic theory would predict based on game theory and what not, they would come closer together fiscally and politically, with the EFSF taking the role of an EMF (IMF like institution for the Eurozone), in effect creating a European treasury to issue Euro-bonds, and thus instituting a blue-bond, red-bond plan where x % of a country's financing is European and y% is domestic, thus limiting debt by market rates but at the same time providing a backstop of European credit quality for the majority of debt, implying that the x% would be greater than 50%, probably somewhere near 65-70%.

Haole's picture

That's the longest sentence I've ever seen, twice...

oogs66's picture

Neither the blue bonds nor the red bonds will work

geminiRX's picture

I feel like I'm in the matrix - blue pill or red pill :)

propflow's picture

press <HELP> for explanation

 

Zola's picture

Exiting the euro for the weaklings will not be costly , it will be salutary. Only a few leveraged banks and crooked politicans will be impacted. The average citizen in the northern countries would have massive boost in purchasing power and the southern countries could start exitig from their weight of debt. Only the media is conditioning you to believe such outcome is "costly"...what is costly is the total failure of the euro in hyperinflation and thankfully the germans will have none of it.

A Man without Qualities's picture

It will be costly, and it will be painful, and the effect will go further than the banks and politicians (hint - pension funds and insurance companies, ECB requiring recapitalization.).  It will drag down the Euro, therefore not creating much of a boost in purchasing power.

The other problem is, when the defaults start, there's going to be all sorts of surprises creeping out of the dark, some of which might be very nasty indeed.

However, it is necessary and almost certainly inevitable and only once it happens will the recovery start (no matter how slow and long).

All the attempts to fix the problems are nothing more than delaying tactics by desperate politicians who just don't want it to happen on their watch.


silver500's picture

In the current climate teh Greek government does not have the integrity to issue a new fiat currency.  They can mandate that the Greek people pay taxes in it but will be unable to enforce them to exchange their Euros for New Drachma.

Subprime JD's picture

Give it time, eventually this market will break to the downside as the Euro crisis is much bigger than subprime mortgages.

Father Lucifer's picture

Pixies and leprechauns have announced they will be selling their gold to bail out the EU.

Spitzer's picture

Using deflationsists logic, the Euro should be rising on this news.  I wonder if Robert Prechter and Mish are long Euros....

buzzsaw99's picture

deflationistas never do read the writing on the wall ( MENE, MENE, TEKEL, PARSIN ). They may not see the bank bailouts coming but the currency markets always do.

itsonlymoney's picture

They have ALL been weighed, and they have ALL been found wanting...

buzzsaw99's picture

Modern day bankers (Belshazzar) can't hold a candle to the grizzled old timers (Nebuchadnezzar). The end of their reign of terror is nigh.

itsonlymoney's picture

Won't be long until the seventieth week begins. 

Hman's picture

Guess what ... markets will open stocks down, gold up, dollar up, US bonds up  ... The Euro wins the ugliest contest for now..

unky's picture

Silver down with the Euro, I bet

Hman's picture

Naah, it will be 2 x gold to the upside ...

unky's picture

No, that will happen only when Bernanke prints. And then the Euro will go up too. Then we will see Gold up 1x and Silver up 2x and Euro up 1x maybe.

Sudden Debt's picture

You're right, silver has always followed the euro.

Monday silver will be down. 100% sure.

 

Hearst's picture

Nah.  Safety flight into Gold will tug Silver's reigns.  Both metals are primed to explode.

MsCreant's picture

Gold's got your back for sure, we will see about silver.

LawsofPhysics's picture

Yep,  back and forth, back and forth.  The dollar is ugly, the euro is ugly, the dollar is ugly, rinse repeat, fleecing all taxpayers a little bit each time until eventually the central bank can kick the can or the BRICS say enough is enough.  If the BRICS didn't have their own problems they would have thrown the dollar and the euro off the see-saw.  I mean fuck, they built and OWN the playground equipment.

 

Stay ahead of the curve people, the signs were clear on friday. 

gwar5's picture

Bernanke will have lots of room to print with Euro-collapse.  Curously, Rickards and Rogers both said they were long Euros and would buy on collapse.  They expect it to be saved and rebound? How so that?

FunkyMonkeyBoy's picture

The theory is that they expect only the strongest european countries to be left using the Euro, so it will be a strong currency once all the weak countries like Greece, Spain et al are tossed out.

buzzsaw99's picture

unless germany leaves and the weak stay.

Prometheus418's picture

If it collapses to .5000 or below, I'm a buyer.  I still have faith in Germany and *gasp* France.  I can't see them allowing Greece and Portugal to take them down.