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EURUSD Tumbles, Italian Yields Pop After Merkel Says "Firmly Against Eurobonds"
The entire hopium driven rally from yesterday afternoon on a Reuters report that Germany may be warming up to the idea of Eurobonds destroyed by one word out of place, in this case Merkel's who just said that "she stands firmly against joint Euro-bonds." Translation: market will have to punish EURUSD far more for her to change her mind.
And Italian yields:
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Jetzt geht loss!
This bitch is crazy. How can she say that it is imperative to mantain the unity of the euro region opposes eurobonds. Either Europe consolidates fiscally and uses 1 currency and 1 fiscal scheme or it desintegrates. Choose your poision bitch.
Question to you Hard 1 : how much more money should the Germans pump into the loser states of Europe before even you can realize that it won't work?
Go Angie! finally, finally stick it to those losers and pull Germany out of this so-called "EU adventure"!
Angie can be replaced by a technocrat too ... we'll see
Merkel will resign and there will be an investigation into her devious sexual practices. How do you say "bunga-bunga" auf deutsch?
Arnold Schwarzenegger will most probably be appointed as new german fuhrer.
The village idiot out again!
Similar things were said at the beginning of reunification, "Why should hard-working West Germans pay for the East Germans?" -- They wanted this EU projekt, now pay for the profligate states or leave the union and release D-Mark 2.0 - what did they think would happen during the hard times? Central planning fail.
and it was the Germans who claimed "bailing out Greece would be no big deal" yes, yes? Are we now speaking of the unity of "Germany" itself now?
Do you understand the difference between unification and reunification?
Eurogold: If pumping to other countries is not what you want, then the alternative is to leave the Euro, and issue Deutsche Marks, which i think would be best in the long run for Germany. My point is that you cannot have both, same currency and different fiscal policies, as has been proven to be an obvious fact by now.
Hard 1 you are right ....you can't have it both ways. My hope is for Germany to pull out.
"no united Europe, no united Germany."
Hats off man. The question is : Will the ECB print or not?
I know if they do print, then the EURUSD down. I guess you would expect the markets to spike for a short period. But US markets is correlated with EURUSD, so will that rally (to be) short lived? Also if they print, I expect gold to spike!!
If they don't print, still the EURUSD will go down, and of course all markets will go down and may break the EZ.
I suspect that the markets will go down irrespective if they print or not. I wish people can share their thoughts.
NOT TOO many years ago, when the State of Utah was going to execute a human being, said human being was given the choice of being shot or hanged. [Urban legend is that one human being asked which method cost the State of Utah more money, and opted for that method.]
So A-Merk....What will it be? Woven necklace or a red dot on your forehead? You get to choose.
maybe she can hold in tight.
http://expose2.wordpress.com
whyyyy? just issue eurobonds, and have ECB buy 600 billion a year.
yours
Ben S. Bernanke
Come on Angie baby, Do the Twist.
Uptight germans.
http://www.youtube.com/watch?v=xbK0C9AYMd8
Idiotttt Banksters want Germany to monetize European Governments failures!
Stay tough Mrs. Merkel, I am with you!
Besides its not tumbling, its just returning to its new normal 'mean'.
Deutsche Bank obviously hasn't got Angela by the balls..
..as the Bangsters have the rest of the spineless puppets in the West
We're lucky that she has no 'balls' to be grabbed by the mob.
The new iron lady!
C'mon Angie, smash 'em!
Stay strong Angie!!!!!!
started out thinking she was the only sane one in Europe, then looked like she was doing the EFSF thought she was just like all the rest and now with her foot dragging and dithering i'm 50/50 undecided
changing my mind like a woman!!!
no, no, no. Monetization PROTECTS the government PROVIDED it is done right. The right term "in this instance" would be "burden sharing." If Germany wants the markets as well as the greatest labor pool on the planet it must give. Without giving...it get's neither. One need only look at Wall Street today: it gave nothing...and is now losing everything to the government.
Squid 0 Germany 1
Hang on. How come the squid gets 0? Don't GS technojerks in Greece, Italy and ECB count for anything? The squid at the very least deserves a -3.
lol no wonder the euro dropped. i love merkel; dont give in
Merkel is a lying twat. She says she's against it, but behind closed doors, that's not what is happening.
Exactly, she's only posturing for elections.
Are you saying she is bent over? Oh, right. That's the German people.
I doubt she flies around in helicopters anymore, at any rate.
I don't understand. If she holds out against Eurobond creation, why should the EurUSD drop?
Shouldn't the EurUSD drop when she gives in and allows the Euro printing?
Somebody enlighten me..
Funny article on cnbc discussing this, heading stated Germany warming up to Euro Bond purchase but it in article it states Merkel will not allow it. The bankers and Loser countries can't admit that it ain't happening anytime soon. Faz and tvix = retirement at 50
With her remark, Merkel destroyed the entire goal of the press conference: to improve confidence. She is as high a risk in these settings as Berlusconi was. Replace her with Abby Joseph Cohen, basta.
you think "confidence" is improved by bubble blowing?
so where are we since piling new debt on old debt started 2 years ago??
CONfidence must be sky high by now right?
tks giving gift form merkel.....loool
Back to the Germany crushing EFSF then!
I fail to understand why Germany would ever be pressured. Regardless to what the market does - the EU is asking Germany to backstop everyone, for everything with no real guarantees (or gold). Massive, endless printing will do nothing but drag everyone down - including Germany. Am I wrong to think it's just easier to kick the piigs out and let the IMF deal with them?
That would prove how stupid several generations of bureaucrats in Europe were to construct such an idiotic Eurozone structure. Nobody wants to be proved stupid so everybody pressures Germany to keep the status quo...
the "idiotic structure" begins with Govt ...that leads to even more delusional (detached) international Govt.
All mistakes begin with the biggest social and economic mistake in history: Govt
Right then, back to the "divine right" of Kings, or:
http://pixel420.com/pixel420/stateless/
I am with you! No Germany should just leave the party with the punch-bowl!
The European Feeration of Germany's States?
We are approaching a critical moment. Everything is signalling deflation except Gold which is the last man standing. It is caught in a fight between $1680 and $1700 which will see one side take the upper hand soon. Watch out for the 150 sma (at about $1650 right now) it represents the uptrend line since 2008. If it is taken out, Gold will be in a very bad position. After that the last line of defence is the 200 sma (at $1590 right now) if it fails deflation will be confirmed. Silver and the rest of the commodities are already saying we are in deflation or de-inflation to be more accurate.
A good defensive position is to be 50% Gold and 50% cash (or US bonds) you will be protected no matter what happens.
Good luck.
I have been trading for about 1 year now so still have much to learn but I never understood why you should have defensive positions by keeping cash when you can purchase inverse funds. Why not just own some vxx, tvix, etc am I missing something?
Hello MF Global ! It is still headline news !
In the end the winners are those who loose the least.
Yes, and be sure to keep that cash where you can see, smell and touch it.
Sealy?
...am I missing something?
yeah, a brain.
After moving out of Gilts today, 50/50 cash & gold (some physical in my possession and some ETF / spread-bet with stop-loss) is where I stand.
Looking forward to picking up some bargain equities (and more physical) in the coming shift out of bonds.
Ask Gerald Celente how wise of him was to have gold ETFs.
He still holds his ETF's. Its his december futures that he got screwed on. See his Alex Jones interview
Oil is the best tell on inflation deflation. No deflation yet.
If by Oil you mean WTI then you're wrong.
WTI is irrelevant, the world uses Brent and it’s not doing well.
Not doing well??
http://www.tradingeconomics.com/commodity/brent-crude-oil
Seems OK to me given huge deflationary impulse in last 3 months. When they turn the inflation spigot back on, gasoline is $5 or $6 per gallon. Count on it.
"...Seems OK to me given huge deflationary impulse in last 3 months..."
I think you just said it here and 20% below the years high is not well to me. In fact when something drops by 20% it is considered to be a in bear market.
Get real. 20% is child's play. U naive
Impulse does not mean long term trend
In the prior twelve months it was up 100%, so it corrects 20% and we have deflation? I don't think so champ. Until we get lower lows this is no 20% bear market. Go back to the textbooks.
"A" bottom or "the" bottom, there is a difference haha.
The true bottom comes when technicals and fundamentals no longer matter.
Before that you at least have to see the safe-haven sectors sell of eg utes.
First, I'm not talking about the long term either.
Second, you can't base your judgement just on Oil.
Third, most commodities are down at least 20% and 20% is significant. I know they had a good run up but that does not change the fact that they are going down and the momentum is to the downside.
Fourth, the USD is strengthening and that reinforces what I'm saying.
Sixth, bonds are saying deflation too.
Finally, bankruptcies and defaults are deflationary.
So yeh, we are very likely going into deflation until Benny starts pumping again.
I thought WTI soared 20 percent once the pipeline flow was reversed? that doesn't sound deflationary to me at all. Are we going to have supply issues now? cuz once that happens then governments can't finance themselves either...
Supply issues? You mean like the Strait of Hormuz suddenly filled with mines and/or sunken ships?
I still fail to see what the Eurobonds will change/improve net net. If the Eurobonds encompass all 17 Eurozone countries, they will be rated accordingly. It's not as if they will get the rating of the choice of the litter. And even if they did, the market will still ignore it. Can't forget about the last 18 months, now can you. And Europe will still be insolvent as a continent. So what is the big deal?
Loosely speaking with a simple example:
(AAA*(high weighted German funding needs) + B (low weighted Portugese funding needs) )/2 = AA- (when you factor in that Portugal needs to raise far less capital than Germany)
The problem is that countries with serious funding needs like Spain, Italy, and France are too large for a risk pooling scheme to be politically acceptable. It will impact funding costs for Germany far too much and put them in similar straits.
Print (then hope for sufficient time for fiscal reform to heal the situation) or disintegrate.
Perhaps at EUR/USD 1.29 we will see some market-friendly policies from the Euro-muppets, but not till then.
@ Peter K: it depends whether all EZ-members will be joint and severally liable for the eurobonds. In a perfect world, the liquidity premium should be lower on the eurobonds which should make a difference for the smaller countries in the EZ.
Yes, but only if one assumes that the liquidity premium/credit risk was correctly priced pre crisis. And I think that is is safe to say that this was not the case.
Seriously, look at The Fed's stress test for OUR banks. They can't possibly survive further 21% decline in house prices.
Upcoming Case-Shiller Report and The Fed Reserve Comprehensive Capital Analysis and Reviewhttp://confoundedinterest.wordpress.com
Merkel is so conflicted that she comes off as a complete idiot. Make up your mind and lead!
You either print or you don't. There is very little time left before your choice becomes irrelevant.
but strong is the force in the fat one!
actually all those developments are Euro bullish imho> it would be the eurobonds that would be the nail in the coffin for the euro so what we are seeing are baby steps (no monetization / no eurobonds) to a currency that may survive (once weak members are expelled) and the EURUSD >2 here we come...
if the EUR/USD goes over 2 and Germany is still in the EU...German exports are toast.
For this reason alone Germany needs France to stay in the Euro. Also, the very raison d'etre of the Eurozone is to not allow Germany and France to be in different camps.
And if Germany really cares for its exports, Italy should stay in too.
I'll be going to Thanksgiving Dinner later today and I'll be hit on by multiple family members for cash loans or co-signs of loans. There will be hard feelings if I deny any of these loans or co-signs of loans.
If I deny all loans I'll be an insensitive, uncaring ogre.
If I loan money to the resposible and/or truely needy family members, but deny the lost-cause family members, I will tear the family apart.
If I loan money to all I will become insolvent myself.
Is there a way to issue "Itstippy Family Bonds" and sell them to the IMF?
Best defense is offense. Immediately announce upon entry that you lost your ass in the market and would anyone be so kind as to loan you some money? Piss and moan about being poor again and then proceed to enjoy your meal and football.
That's not a bad strategy.
I pile on a Brussels strategy. I insist on absolute control of family member fiscal policy to dictate what they buy for food and transport and downsizing their apartment.
The request for loan is usually withdrawn.
Rule of thumb regarding loaning money to family members or friends: If you can't afford to just give it to them, don't loan it to them.
"Are there no banks or credit untions?" -- Ebeneezer Scrooge, paraphrased
I didn't say don't give it to them if you can afford to.
BDSM PISS SKAT alive and well in the fatherland. No pain too great for the world
Merkel vs. the Bankers and EuroFascists! She better get a food taster, start wearing Kevlar, and update her will.
I think you guys seriously underestimate the democracy deficiency in Germany and in pretty much whole Europe.
The thing is, Germans might not like the idea of Eurobonds (yuckkk!) , and they even might vote culona inchiavabile ( pardon my Italian ) out of office over the issue, but what they will get is another party which will hand over the bailouts just the same.
There is no politician in Germany which will simply say 'let's do what is best for the German citizen'. They all say 'let's do what is best for Europe'. Likewise in other countries, and if you dare say otherwise, you make yourself a pariah. Case in point: True Finns, Haider, V. Klaus, Kaczynski, many others.
Everybody wants "the wife drunk and the barrel full" (literal translation from an italian proverb meaning all the good things together) in Europe. Even Germany: alone they would have an Euro 2.0 worth 2 USD or more, so they would enjoy crashing exports and a loong recession. That is why nobody is able to take any decision: there is no possible good outcome for anyone.
I knew it. I have seen Merkel in a porn video.
Doesnt she look like a classic German latex femdom?
The bitch is enjoying the punishment she is handing out
ironic that it boils down to germany and the jewish bankers again, this time in the usa.
merkel will give in when she decides there is enough room to give in. she could use some help from some usa bureaucrats to show her how to post a negative growth and deflation chart so she has political cover to do it. of course, a war in the middle east with russia cutting off euro gas supplies for a coupla weeks would do it, too.
EURUSD headed to parity before sinking to 0.00.
Before EUR dropps to zero, they need to find buyers for the debt
http://inkom.com.au/German_Bond_Auction_Failure_Signals_Higher_Borrowing_Costs