EURUSD Soars On Reuters Report That Greek Deal Is Reached... Which Is Same Deal As July 2011

Yeah, we had the same response as our readers when we saw that freak move in the EURUSD. Apparently, despite the fact that absolutely nothing has been resolved, Reuters just ran a headline that "Euro zone reaches deal on second Greek bailout package." And that is all it took for the EURUSD headline scanning algos to surge by 60 100 pips. That there nothing substantial in it, or that this is merely a rephrasing of the actual Bailout 2 announcement from before, is irrelevant. Here is what the actual Reuters report said.

Euro zone finance ministers struck a deal early on Tuesday for a second bailout programme for Greece that will involve financing of 130 billion euros and aims to cut Greece's debts to 121 percent of GDP by 2020, EU officials said.

"The financial volume (of the Greek package) is 130 billion euros and debt-to-GDP (will be) 121 percent. Now it's down to work on the statement," one official involved in the negotiations told Reuters.

Another official confirmed that the financing would total 130 billion euros with the aim of reducing Greece's debts from around 160 percent of GDP now to 121 percent by 2020.

And from AP:

The deal - details of which were still being worked out by European finance ministers in an all-night session in Brussels - was expected to bring Greece's debt down to 120.5 percent of GDP by 2020, according to the official. That's around the maximum that the International Monetary Fund and the eurozone considered sustainable.

Some eurozone ministers had indicated before the meeting that they would not accept a deal that didn't put Greece's debt on a sustainable path. The official spoke on condition of anonymity because a formal announcement was pending.

The deal should also give the green light to a related debt relief from private investors, who are expected to take significant losses on Greek bonds they hold.

So just the little matter of the statement, aka the details, which is what has been the stumbling block for the past 6 months. And incidentally, the broad strokes of this announcement is a carbon copy of the second bailout deal reached back in the summer of 2011. In other words, there is nothing substantial to this, and is merely boilerplate. But it was good enough to fool the algos. Now the only question is how long until this latest and greatest deal concoction falls apart again, and the whole farce is repeated all over.

In other news, De Telegraaf reports that the PSI has been agreed on and will reach 75% a haircut on Greek bonds. Translation - next up we have an exchange offer, the failure to reach a voluntary threshold, CACs, and all the fun the trickles down from triggered CDS.

For those bondholders of peripheral debt, as the Greek one is now a lost cause, and will trade down even more, here is what you can expected, courtesy of William Banzai.

Comments

[Mark123]

ho hum...the only way a bailout works is to foist the cost onto the general population either through taxes or inflation.  either way, we are all poorer in the long run other than those who construct the bailout and take advantage of inside knowledge.

stupid fools...all of us.  Too bad my kids will pay dearly for all this bullshit.

[AC_Doctor]

Mark, I doubt the current over-indebted FIAT money system lasts 3 more years.  It is the current population of sheeple, that hasn't prepared for this possibilty, that will pay with most of their life savings in paper assets.

[Dr. Engali]

Three years? I'm hoping the fed doesn't live to see its 100 th birthday.

[Mr Lennon Hendrix]

As long as we don't make a big deal about raising debt, and no one sells the market, this could go on forever!  We're geniuses!

[SAT 800]

Ah, the standard delusion. Well, it's either that, or Nietsche was right.

[Mark123]

I agree...just feel worse for my kids (I got to enjoy more of the fiat party).

Imagine if we were still on a gold standard, and you actually had Germany emptying its vaults into Goldman and JPMorgan trucks (collecting on their bad loans).

[jomama]

oh, you mean all that gold that the US is 'holding' for Germany? (chuckle)

[TradingJoe]

All in all a pretty muted reaction, this does not look good for domani la matina!!! Pre Market might be last chance to do the El Shorto Dance?!

[The trend is yo...]

Reuters breaks the story....bloomberg follows up and creates a positive loop.  The next time bloomberg or cnbs starts it off and the others follow. It's brilliant

Frustrated Short 

[Matt]

If one wanted to make some money, how exactly would one go about seeding a headline to trigger a market move?

[MinnesotaMD]

Blue horseshoe loves annecot steel.

Then shout "Winning" to your pair of ho's

[docmac324]

Something, anything is needed to break 13k on the market before we see five buck a gallon gas.

Hell, lets shoot for 14k, or 35k.

Its all just a game.

[Atomizer]

Managing an unsustainable global monetary experiment has moved the doom failure clock to 11:58 PM.

[Zgangsta]

You can't spell "drachma" without "drama"

[thedrickster]

An urgent message for politicans the world over.....Go Icelandic or go home.

[jomama]

so does this mean they are opting for The Butch?

[Dr. Engali]

Do you suppose they are over at the Reuters offices drinking it up and somebody says " hey watch what I can make the robots do ." ?Then they send out some fucked up headline followed up by shots all around and howls of laughter.

[jomama]

and we all know the guy running the algos to match the market is cut from the same stone as the guy who made all that shitty 80's yacht rock with one Casio.

[Mr Lennon Hendrix]

Funny

[TradingJoe]

It's getting boring, good night y'all!!

[vincent]

If they can duplicate the Greek process we'll have 10 more years of market euphoria.

[Caviar Emptor]

This is a vote of confidence in favor of the great utopia that we live in thanks to central banks, central planning and all those who engineered the bubble and collapse (yes WS and their cronie banks). 

Greece may just have been the model for all the dominos that will follow, right up to the G5. 

[yogibear]

We put different lipstick and makeup on this pig. It looks better now.

[AU5K]

Clearly this is not priced in and the market should soar at least 5%.  Who couldve foreseen the noble ECB coming to the rescue of poor Greece.  Everything is finally solved.  Until its not.

[q99x2]

Ok.Glad that is over. We're not going to have to go through that for Portugal, Spain and Italy too are we?  

[SAT 800]

Oh, no, no; definetly not. Everything will work out fine, I'm sure.

[ThisIsBob]

No. And nor ever again for Greece

[FreeNewEnergy]

Markets will open mildly positive and stall out. No crash, yet.

Everything is on hold until the details come out, though I would think some serious profit-taking is on the minds of some of the human (non-machine) traders about now.

No matter what, PIIGS still can't FLY...

Hang Seng, Shanghai and Taiwan Weighted already starting to tank. The eurocrats have run out of time.

[Conman]

Markets will rally on low volume. Its done it every time there was a greek "solution". This time is no different. The mental patients are running the asylum

[ekm]

Guys

Which market? There is no market in the sense of "willing buyers and sellers of products". Can anybody identify the buyers and sellers?

This is just primary dealers = plunge protection team trading with each other hoping that the suckers will come (suckers = mutual funds).

No suckers in view. People are withdrawing money even from hedge funds sincey they can't beat the primary dealers.

http://ftalphaville.ft.com/blog/2012/02/20/887721/hedge-funds-exit-stage-left-pursued-by-bearishness/

[SmoothCoolSmoke]

We rage, while Banksters are popping corks of Dom.   Hate it...but true.  

[chindit13]

Eupphoria

                 *******CLASSIFIED: SECRET********

From the most recent NSA telephone intercept:

"Nicos? Let me know when our 19% has cleared SWIFT. I'm going to put another call into the Troika for next week's allowance."

[SmoothCoolSmoke]

Euro 134 when London opens? 125?  We'll see.

[SmoothCoolSmoke]

OOps, meant 135?   (125.....only if....)

[q99x2]

Further proof that torture fails to produce useful information.

"Shares rangebound despite Greek deal."

[Global Hunter]

This 5pm press conference originally scheduled for 5pm EST on MOnday is never going to happen. They'll just instruct Reuters and Bloomberg to release some timely headlines about deals being reached...and almost reached...and reached again.

[yogibear]

LOL, deal #101, then deal #102, then deal #103.... The Euro version of Groundhog day . The clock raidio went off again playing the same song.  An  announcement of success for more Greek bailout money.

The calendar is already marked for future Greek bailout announcements once this one is no longer effective. 

[cnhedge]

this headline is indeed misleading!

http://www.cnhedge.com

[SillySalesmanQu...]

.

[asteroids]

Greece agrees to a deal that still leaves them broke. The algo's go wild!

[sasebo]

Just so everybody has plenty of funny money everything will be okay. Just keep printing.

[DB Cooper]

Wait 'till no one but the EU buys PIIS debt from here on out!

[Bdelande]

Now that the sham deal of the century has been cut.....the walk of shame begins.

Never have so many suffered at the hands of so few, for so much.........

The EU Technocrats have disgraced them selves by throwing the lowest rung of the Greek people under the bus, in order to save the greedy irresponsible Euro banksters, and thier partners in crime, the Greek politicians whom are bought and paid for by the very Greek elite scoundrels, that have ilegitimately gained the most from this dispicable scam, set up and endorsed by none other that the giant GS squid itself.........

May the money changers that permitted this travesty of the highest order all rot in perpetual hell..............

[Lore]

"The deal - details of which were still being worked out..."

If the details are still being worked out, then it's not a deal!

"Debt...to 120.5 percent of GDP...that's around the maximum that the International Monetary Fund and the eurozone considered sustainable."

Anything greater than 100% is "unsustainable."

If I was a Greek, I would worry less about the numbers and more about the snapperheads who are tampering with them.

BTW, how do they propose to pay for Iranian oil?  Will they pay with Euros, USDs, Drachma or Gold?

No mention of that in today's commentary...

[jimmyjames]

BTW, how do they propose to pay for Iranian oil?  Will they pay with Euros, USDs, Drachma or Gold?

No mention of that in today's commentary...

*************

Good question-i think they might be able to pay in any of those currencies but only if they default because if they do default and reinstate the Drachma-foreign money should follow-as in tourism boom/cheap labor etc-

It worked for Iceland-

[number cruncher]

"It is understood that the disbursements for the PSI operation and the final decision to approve
the guarantees for the second programme are subject to a successful PSI operation and
confirmation, by the Eurogroup on the basis of an assessment by the Troika, of the legal
implementation by Greece of the agreed prior actions. The official sector will decide on the
precise amount of financial assistance to be provided in the context of the second Greek
programme in early March, once the results of PSI are known and the prior actions have been
implemented."

So there is NO DEAL until the PSI operation is agreed upon........ so the bondholders need to agree to the PSI without parliamentary approval of the disbursements for the PSI to the bondholders... its a bit circular there.

[swani]

I have said this before but I will say it again, Greece will not be allowed to default until Obama, or another Manchurian Candidate who will continue with the same exact agenda is safely in the White House. Then, Greece will be allowed to default, Bank of America sure to follow loaded with all of the junk that they can cram into it the rest of the election year, the depositors' money will be taken a la MF Global to cover the exposure. This will be followed by a complete rewriting of the laws governing Credit Default Swaps, ext. The tax payers of the world will be squeezed for all of their money until they can't be squeezed any more, so we still have a ways to go until the end of this post bubble power grab.    

[Darkness]

So what does this really mean? Is it another European Ponzi?

[nathan1234]

!) The FASB has changed the Accounting Standards.

Accounts are not accounts anymore.

2) Politicians have changed Ethics and Norms.

Lying, cheating, twisting words and enacting illegal laws

And people have become dumb and likely to be dumbed down further.

Wonder what the future holds. Looks like War or Revolution or maybe both

[non_anon]

don't forget to turn the light off

[ruffles]

transitory.

[HungrySeagull]

Hong Kong Gold and Silver has gone up big as I type this.

Will it hold and break the 34.00 barrier for good?

[caerus]

"soars" is not the word i would have chosen

[Winston Smith 2009]

"aims to cut Greece's debts to 121 percent of GDP by 2020"

Ha!  What ignorant optimism.  It'll be much lower than that LONG before 2020 when they default.

[The Onion Of Tw...]

I always thought that all you need to be successful in banking is to be tall and have good hair. Now Banzai proves it.

[Olympia]

Loan sharks knew that if they took the dollars printing machines under their control they could suffocate the world ...they could initially suffocate USA and after taking the USA from the Americans, they could move and suffocate the whole world and take the countries from their people.

FED printed cheap money and loansharking multiplied this money in an unnatural way within the American economy boarders and they discarded them abroad so that they did not threaten USA. USA became the first state in the world with artificial “breathing”...

It cannot be possible but just in the USA for only the last year, more than one million houses were seized. It cannot be impossible but the New World has returned to tents and shelters ..has returned to the ages of Columbus. It cannot be possible that we allow to a few loan sharks looting the toils and the assets of people...

http://eamb-ydrohoos.blogspot.com/2012/01/global-debt-crisis.html

------------------------

Global Debt Crisis

Authored by PANAGIOTIS TRAIANOU

[Dre4dwolf]

It seems europe needs greece, you know because Loans  + Print money, but when you print money without cause it looks bad, see they needed a crisis . . .  a reason to print away and give it to their freinds.

My family in greece is actively trying to leave the country and come here to "look for work" hahaha we are talking about people who have lived there for generations (pre WW1) just getting sick of their govt and looking for anywhere to go.

Fuck you bankers you destroyed Greece.... just to make a quick buck and get in bed with a bunch of wanabes .... should be ashamed, banker low class trash.

[kanenas]

2009 Debt/GDP = 129% (possibly inflated to push for a Troika solution, DA is looking into it)

2010-2019 Austerity-fire sale of national assets-weaker working rights-cheaper labour

2020 Optimistic: debt/GDP= 121%, realistic 160%

Nice plan. Good luck sticking it to the people.

[rupeshpatel]

im new to ZH .. can someone explain why algos may move a market on a news story? to my knowledge algos are not programmed to pick up on words in stories. If this was a strategy it would probably be a losing one as stories on bloomberg/reuters are often yesterdays news/journalists who put these stories together havent got a clue?

[blueridgeviews]

You can keep printing these stories ad nauseum and the facts don't change one iota ( 3 years running). The entire financial system of Europe, Japan and the US is completely manipulated.

How about giving me something new to read like who the hell is behind all this mess. Who is controlling the price of oil. Who's who of GS andf their cronies in world Governments.

Where's the outrage over the GM bondholders taking a back seat to the UAW?

We all knew Greece was done 2 years ago. A third grader could deduce that from the facts.

Tell me something new!

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