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Front Page Of Main Austrian Business Press: "Politiker Riskieren Hyperinflation"
Now, we admit our German is a little rusty, but we are fairly confident we get the gist of it. Also, it appears that Die Presse says "Hyperinflation" not "Hyperdeflation" - have even the Austrians realized that no government, political system or social regime in the history of mankind ever imploded due to hyperdeflation?
We present the first two paragraphs for our German speaking readers in their entirety. We are confident everyone else will also grasp the hatred toward the creeping bailouts that now seeps everywhere, and why the alternative is, as Die Presse, says hyperinflation.
Der (offenbar zu kleine) Euro-Rettungsschirm ist von den nationalen
Parlamenten noch nicht einmal abgesegnet, da ist schon von einer
gewaltigen Aufstockung die Rede: Am Rande der laufenden Weltbanktagung
in Washington wird darüber geredet, wie man dem mit 440 Milliarden Euro
dotierten Rettungsschirm EFSF im Falle des Falles „mehr Feuerkraft“
verleihen könnte.
Einfach aufstocken geht schwer: In „Zahlerländern“ wie Deutschland
oder Österreich ist der Unmut in der Bevölkerung über die Riesensummen,
die für die Rettung der Eurozone aus Steuermitteln bereitgestellt werden
müssen, schon jetzt groß. EU-Währungskommissar Olli Rehn spricht
deshalb schon offen darüber, dass es notwendig werden könnte, die Mittel
des EFSF zu „hebeln“, um „aus einem Euro fünf“ zu machen. Angelpunkt
dieses Finanz-Kunststücks soll die Europäische Zentralbank (EZB) werden.
Druck dazu kommt unter anderem von den USA, deren Finanzminister
Timothy Geithner gemeint hatte, die Eurorettung werde nur funktionieren,
wenn der Rettungsschirm unbegrenzte Haftungen übernehme.
Die wildeste Variante sieht so aus: Der EFSF kauft Anleihen von
Pleitestaaten wie etwa Griechenland auf und hinterlegt diese als
„Sicherheiten“ für weitere Kredite bei der EZB. Mit diesen Krediten
kauft er wieder Staatsanleihen, die er als Sicherheiten für neuerliche
Darlehen bei der Notenbank hinterlegt. Das wäre eine wesentliche
Änderung der bisherigen Pläne, die vorsahen, dass sich der EFSF mithilfe
von Staatsgarantien auf dem Kapitalmarkt finanzieren müsste.
Full thing below:
h/t Open Europe
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From Google translate:
The (apparently too small) euro rescue package is the national
Parliaments have not even approved, there is already a
tremendous increase in the speech: On the edge of the ongoing World Bank meeting
Washington is talking about how the 440 billion euros
endowed rescue EFSF in extreme cases "firepower"
could give.
Simply top up is difficult: In "payer" countries such as Germany
and Austria is the resentment among the population about the enormous sums
provided for the salvation of the Euro zone by taxes
must already large. EU Monetary Affairs Commissioner Olli Rehn says
therefore been open about the fact that it might be necessary, which means
to "pry" the EFSF to make "one of five euros." fulcrum
this financial piece of art is to be the European Central Bank (ECB).
Pressure to come by, inter alia, the United States, whose finance ministers
Timothy Geithner had said that the rescue will work only €,
if the bailout assume unlimited liability.
The wildest variant looks like this: The EFSF buys bonds from
Bankrupt states such as Greece and deposited them as
"Collateral" for further loans from the ECB. With these loans
he buys back government bonds as collateral for his recent
Loan with the bank deposit. That would be a significant
Changes in current plans, which stipulated that the EFSF using
financing of government guarantees on the capital market would have.
From TSX500 translate : BTFD
The system will collapse. It was built to.
These types of articles can't be good for the Fed's new "social media whatchdog".
Oh, and, Fuck you Bernanke.
"The wildest variant looks like this: The EFSF buys bonds from Bankrupt states such as Greece and deposited them as "Collateral" for further loans from the ECB."
This is the real meaning of collateral damage... ;)
The German constitutional high court has set strict limits to future bailouts, so they need to take the ECB train now. Or openly break the constitutional limits. Trust me, nobody wants revolting Germans, the ECB will have to pay.
But our friends from the City of London and the other non-euro share holders in the ECB , do they want to take the risks collectively with the rest of the euro-europeans?
"Trust me, nobody wants revolting Germans"
YOU might not be attracted to them, but it's a little over the top to call them revolting.
Collateral?
I got your collateral . . . right here!
www.youtube.com/watch?v=-zJlsc8GU50
This is utter nonsense.
The moment the ECB would try something like this, the Germans would mobilize.
Its that simple.
don't you mean "udder"?
The only mobilization you'd see is them packing the beer gardens in a year long Oktoberfest to be instituted by the power elite.
don't know about that ... there have been protesters in the streets against the EFSF in a number of German towns. And in Stuttgart, they have been holding Monday night protests attended by thousands of people against a new train station for over a year. Germans are not as complacent as you seem to think.
Are you calling him a cow?
Given were he's grazing, you must not wonder....
Seriously, do you believe that S&P would allow this clunkers for cash game without sending it all down to C ---- ?
aUsTrIaNs, YOU MADE ME LAUGH vErY hArD ONCE MORE... :-D
The gist of the article is that the EFSF will use the bonds it has already purchased as collateral at the ECB for future purchases of sovereing debt with a multiplier effect to get to 5:1 on the initial authorized amount of the EFSF fund. I'm not sure where the ECB would get the resources to sterilize all that.
Those bonds, which they paid full price for when nobody else wanted them at any price, how can you use "garbage" as collateral for more loans in the future? It would be like me buying a huge house everyone knows I cannot afford and then using that as collateral for a Bentley everyone knows I can't afford.
From thin air.
Thanks for the translation. Looks like a stuggle between Bankers (who do not want to lose very Fat Bonuses) and Europeans working/retired Folks (mainly German speaking peoples) who have the burden and the pain.
It's gonna get pretty heated I suspect.
BTW, Anyone read the Faber article posted on ZH earlier?
KLINK!!!!!
getten zee assenheimer in heir mach schnell!
You used German when you should have used Austrian.
The (apparently too small) Euro rescue package has not even been approved and it is is being discussed at the periphery of a running World bank meeting in Washington how the EFSF could be granted the endowed, 440 billion Euro bailout, just in case.
Actual human being translation:
The (apparently too small) Euro rescue package has not even been approved and it is is being discussed at the periphery of a running World bank meeting in Washington how the EFSF could be granted the endowed, 440 billion Euro bailout, just in case.
Simply stocking up will be difficult, In “Payer countries” like Germany and Austria, the displeasure of the population about the enormous sum, which must be provided in advance from tax revenues, is already large now. Therefore, EU Monetary Affairs Commissioner Olli Rehn, says that it could be necessary to “pry open” the EFSF funds, in order to make “five euros out of one.”
TheEuropean Central Bank (ECB/EZB) should become the fulcrum of these financial tricks. Additional pressure comes, among others, from the USA, whose Finance Minister, Timothy Geithner, had mentioned, the bailout of the Euro will only work, if the bailout assumes unlimited liability.
The wildest variant looks like: The EFSF buys up the bonds of bankrupt states, like Greece, and deposits them as “securities” for additional credit with the EZB (ECB). With these credits, it purchases additional governments bonds, which it deposits as securities for new loans with the Fed. That was an essential change from the previous plans, in which the EFSF had to finance itself with the help of state guarantees on the capital market.
Schwanz-tanz.
Don't speak German, but intuitively I'd venture a guess that "Pry open" should be "lever up"
I think you must be right. I know German, but not Finance. Thanks!
Don't forget that "bend over" is also in there somewhere.
how did I miss that?
(smacks forehead)
here it us,
"Uber-benden mussen Sie Alle!"
hyperinflation is the fiat way.
http://expose2.wordpress.com
Oro mis amigos!
I demand anchluss between the euro and physical gold....it will make everything better.
Tyler, you're da man
Why does it feel like we just passed the "it's getting ugly" sign on the SHTF highway?
Highway? Feels like we're doing 80 mph on a washboard pothole filled gravel road...... one hell of a rough ride and it doesn't seem like the brakes are working....and we're on a LONG downhill grade - with lots of curves.... reminds me of this back road into Death Valley out of the ghost town of Rhyolite
you forgot the washed out bridge
That and the fact that there are at least 15 incompetent, blithering idiots all wrestling over the steering wheel.
Ja ja, hierzulande redet man eben Tacheles! Jawohl, so sieht's aus!
Translate "jaja" to the audience ... :-P
is it just me, or does timmy sound like a guy trying to make a certain currency worse than his own?
I'm just glad there is no civil unrest in the world! Then we might have more problems......
On the contrary, you have civil unrest!!! Be glad it's isolated in the middle East & Africa, for now.
Now with the protests in Manhattan things are getting ugly. As I come from a former socialist country I know the symptoms and believe me, this is just the start of a change for US. Two possible paths:
a) either those in real power at present guide the society into an immitation of a change (striving for the least possible dammage of the status quo)
b) or there is a real change
guess what's better for the middle class (currently under extinction) and regular Joe's
P.S. for (a) to happen they will create for you an enemy (needs to be more scary than the current... why not China or Russia)
'Hatred of bailouts everywhere'...central banksters caught between a rock and a hard place. Its not 2008 anymore when people thought bailouts were cool, now they fool no one.
sounds like deeeeeeeeee-flation to me sheepie
'Deflation', similar to the Hindenberg.
combustive deflation. I wonder what that looks like economics-wise.
Well everything burns. Of course.
Immoflation
Bail outs are not cool? BAIL OUTS AREN'T COOL!? Taking my money and to give it to private businesses that made horrible investments, and inflating profit margins over years of money priting is effing awesome. We should have been doing this as a nation for years. That debt needs to be up around $30-$40 trillion. There should be a $15 trillion bail out so everyone in the US can be a millionare-billionare that pays more in taxes and can buy more shit. All problems solved homie.
And don't forget the ponies. Everyone gets a pony.
Finally, finally after all these years of wishing, I will get a pony!! childhood aspirations vindicated!
To hell with the Pony, I want a UNICORN that poops skittles!
I want a pony that eats debt and shits bricks of gold ... ain't going to happen.
Bail outs are not cool? BAIL OUTS AREN'T COOL!? Taking my money and to give it to private businesses that made horrible investments, and inflating profit margins over years of money priting is effing awesome. We should have been doing this as a nation for years. That debt needs to be up around $30-$40 trillion. There should be a $15 trillion bail out so everyone in the US can be a millionare-billionare that pays more in taxes and can buy more shit. All problems solved homie.
You will never get your money back.
But rest assured you will at least have the gratifying experience of taking many...MANY turns at the bat while the banksters/politicians and their families are foisted like pin~atas for the masses to beat to a pulp.
hey ahmeexnal, re: ecuador-- it is no secret that correa despises the dollar. but he is an economist first, and has not tried to replace it, knowing it has brought stability to ecuador. that being said, there have been rumors floating around for quite some time that he has the mechanism in place should he be required to re-introduce the sucre.
as far as salinas, it has seen some booming construction for quite a while. a hot coastal area these days is bahia de caraquez--very good for surfing. my only concern about the coast is security. over the past several years, crime in ecuador has been on the upswing, much of it as a result of colombia cleaning up and the roaches moving across the border. the coastal areas tend to have a higher concentration of it than the andean region. correa is taking meaningful steps to reduce it though.
Thanks for the info. My guess is even if there's not a fast enough sucre backup plan, people would continue to trade with colombian/venezuelan/uruguayan currency.
Another question, do you know how hard is it for foreigners to buy real estate in Ecuador? I've searched and I get many links about how easy and great it is to buy real estate there compared to other South American countries. But if I change the name of the country on the search, I get similar results.
no, its not hard, especially if you are a cash buyer. that being said, things generally move at a snails pace in most of latin america, so you can expect alot of "manana" (which literally means tomorrow, but really means next week or next month.....). if you are looking at the coast, i would definitely say bahia is the way to go now. its really flourishing, and its got a great vibe. and remember, there is the ecuadorian price, and the gringo price, so dont accept what price you see as reality depending on the medium that advertises.
Thye don't know what bankrupt means??
Niether do you.
"Bankrupt" has linguistic and cultural roots traced back to 8th century BC Sumeria, where the invading Hittites introduced the idea that when your neighbor owes you money you forgive the debt and marry his sisters. The Sumerians called it Ban k'Ruupeen which loosely translates as "Marry the bastard's sisters, he's a lousy Hittite and ain't gonna pay anyway at least you'll get some tail."
Just kidding. You're right, they don't know jack about bankruptcy.
Hyperinflation? Don't let Karl Denninger hear it, he'll instantly ban you!
I imagine he is having a field day with gold/silver right now (though he is smart, and probably giving it a few more days).
Bokkenrijder... Here is an interesting HYPOTHESIS from G Lira regarding hyper inflation and how it might happen... Interesting read...
http://gonzalolira.blogspot.com/2010/08/how-hyperinflation-will-happen.html
Don't worry.
Merkel & Sarkozy are meeting again, it is rumored, to do/say/imply/stare-at something, it is rumored.
09-26 11:17: Market talk of a joint statement from Merkel and Sarkozy at 1700BST - Unconfirmed
Market talk of a joint statement from Merkel and Sarkozy at 1700BST - Unconfirmed MARKET COMMENTARYThat and the bad data seemed good enogh for the equity momos to pump S&P 20 points up. Also the undemocratic nature of Merkozy secret joint meeting has so rotten smell on it that it must be worth at least 5 points more.
Okay then, I'll start a rumor that Merkozy are having a torrid extramarital affair and are using the global financial crisis as a cover for their midnight flings at expensive hotels on the public dime.
You read it here first.
The austrians have always been good for Germany. Well, almost always ...
While I was in Austria three summers ago I kept asking everyone who was working there how they are enjoying the euro. Everybody without exception - waiters, cab drivers, everybody hated converting to the Euro because it made all their costs more expensive. All were in favor of getting out of the EU and getting the Turks out of Austria. But that was another issue..
And here I had thought they kicked the Turks out back in 1683.
Im pretty sure the FED now just pumps stocks to make us pissed off here at Zerohedge.
That would represent about as sound a monetary policy as anything else they've tried so far.
World-wide QE3, 440 billion euros
endowed rescue EFSF is a joke, they need at least couple TRILLION.
Yes, that's just the tip on the bill. Not even the main course.
There was a report on NPR's MarketWatch this morning (yes, it's public radio, yes it's a scam, and yes, MarketWatch is nearly as bad as CNBS with the sell sider propaganda. Don't ask why I was listening to it; it wasn't by choice) that the EFSF will be funded with a minimum of 2 trillion EUR, though details on who will contribute what amounts were non-existent (big surprise).
In any event, given that Merkel is being pummeled in the court of German Public Opinion, and that Sarkozy's party just suffered massive losses in French elections (much as Merkel's party recently did), and given that Germany and possibly two other far smaller Euro States are solvent, while PIIGS+UK+France are all as technically as insolvent as Greece (since none of these nations will ever pay back their debts absent massive EUR printing and a TARP-like program to buy their bonds - aka Suck It Up, Europeans who saved, have money, and acted responsibly - only to kick the can, and not restructure the fatal flaw in the EU), I'd imagine it would take multiples higher than 2 trillion EUR being printed and freely distributed to save the EU, if even temporarily.
The U.S. Treasury, aided by the Federal Reserve, injected 5.2 trillion USD to try and bail out banks and bad financial actors (on the backs of taxpayers), and even that isn't going to stop the full court depressionary economic press.
I'd imagine that if the European Sadists who apparently want to punish Germany and solvent EU Member States are serious about kicking the can far down the street, they'll need to scrape together 3.5 to 4 trillion EUR, for starters. That amount, as an opening bid at can kicking, will be enough to crush the EUR by a minimum of 35%, and then, there are the contagion affects of that to consider, as well as what happens when they have to inevitably print even more EUR to kick the can again (not to mention that such an amount will break living standards all over Europe, and especially rile up Germans as they see their savings literally drained in a matter of a year or so).
You got a green just for that first sentence!
Do we really want to give the Germans "mehr Feuerkraft"?
Blitzkrieg gegen Spekulaten
Jah, die "bösen" Spekulanten bezahlen müssen!
Lafo, hol die Heuschreckenklatsche raus ! (olden but golden)
große Heuschrecken!
wasnt it muentefering who coined the lovely locust comparison?
Reuters:
There is a growing acceptance" that Greek default "is inevitable...Greece cannot pay its debt"
who cares if greece can't pay its debt...bankers bonuses can cover that, the REAL problem is that ITALY has absolutely no way of paying it
...and Spain, Portugal, and throw in France for good measure
Pan European Weimar, bitchez!
the austrians make a brand of cake called sachertorte. Anybody who makes true sachertorte does not cheat on chocolate, jam (marmalade) and butter content. I have a feeling that EFSF is not sachertorte. So its normal that the Austrians bitch about hyper...you don't get good value for money with this margarine and spartam cook.
painted cardboard and wax icing
Potemkin Sachertorte for Everyone!!!
That descriptor is so good along so many fronts, not least of which is "look out below!".
I'm pretty sure that was a mis-translate. At least, into American english.
Your feeling does not mislead you.
The right translation is "sleight of hand".
better translation would be "financial trick."
orly. I thought it was going to be financial piece of shit.
Glad you guys cleared that up.
Though it does reduce somewhat my respect for their journalists. I was all fyred up thinking those guys really say it like it is.
Financial forgery perhaps?
Step one: dig hole.
Step two: toss money in hole.
Step three: profit.
I am disappointed. I scanned that whole article and did not see:
Die Kacke ist am Dampfen.
pods
That was going to be the title.
Managing editors have no shame.
<--- allow me to translate
In Germany the 'Media', especially the TV, is nothing else than Propaganda: Nazi Goebbels at his finest. In Austria a few free Media try to hold the flag of free press and journalism. Though, it is too late.
DW has this Euro sychophant named Meade, looks like one of Rumpoy's bumbuddies. The day the French voted against the EU constitution this EU buttboy was apoplectic, so revolting it was good kind of thing.
Might as well be in a foreign language because god knows noboby here in the states grasps any of this shit.
Just in time for Oktoberfest. For this kind of bumpy ride, I think I need lederhosen more than a hard hat.
Don't go to the fest, that's where they get rid of the bad beer. Order my name anywhere else!
Das kann ja nicht gut für Business sein.
Anyone trading this market has a death wish. I cannot imagine any other reason for trying to time it.
Nowadays hyperinflation is about as elusive as earth-destroying comets and asteroids, man-eating aliens and supervolcanoes suddenly waking up from a 500 thousand-year sleep to devastate a continent.
Deflationary forces are extremely strong: Runaway technological advances a wave that will rise for decades to come, extreme productivity increases, incredible overcapacity and oversupply of everything and totally endless supply of dirt cheap labor in Asia.
Add that the labor market in the west is very depressed. Wages and purchasing power are stagnant at best. You simply can´t have any meaningful inflation without employment participation. Hike prices and you´ll soon run into demand failure and corresponding downward adjustment of prices.
Da word "hyperinflation" translated to english talk means dat stuff gets crazy expensive to buy with da money you gots in yous pockets. I don't know what dem other words says.
You have seen the myth of scarcity being propped up in the U.S. with QE1 and 2. This creates temporary speculative inflation in commodities and stocks and depresses the dollar but once the tap is turned off the bubbles collapse and the dollar rockets up importing deflation into the U.S. That´s how strong the deflationary forces I mentioned are.
Presently a good bout of deflation would be very good for the import-dependent U.S. economy. Collapsing energy prices would be very stimulating for economic activity as would falling prices of foodstuffs and raw materials. This would increase purchasing power and spending of consumers and take down costs of small businesses, both spurring hiring. Also bear in mind that deflation is in effect a hidden tax cut which benefits everyone.
Of course a steady dollar at 100 plus would mean DOW at 4000 but that´s a small price to pay for jobs and increased purchasing power.
Two things bother me:
Or is this simply the biggest coordinated fuck-up in the history of history? Okay, 3 things bother me.
I don´t see how ownership of largely useless stuff like gold could be made illegal. They could as well try to outlaw rare stamps, paintings, weird artifacts and exotic tulips.
The so called precious metals have traded as a hedge against a myth, hyperinflation and are by now facing record price of cash waiting to pick them and other overpriced stuff up at pennies on the dollar.
Silver seemed to get this message during the summer after illusions of grandeur earlier in the year. Since June it has traded like another industrial metal, check the three-month chart for platinum, they´re virtually identical.
Mega does somehow sound more doomy than hyper but just barely.
Probably just a propaganda final exhaustive top about ready to give up the ghost.
Love the line... "damit Mega-Inflation"! Not just Hyperinflation bitchez!!!! , but Damit Mega-Inflation Bitchez!!!!!!!!!
I dont buy this "germans will not put up with this" nonsense. Germans are not bleeding at the moment, not the least. Revolution happens only when they are really forced to pay for this shit, and then even with 10 years delay. So Germany has to be actually broke to allow any meaningful resistance here.
RE: Industrial metals silver and platinum trading in lockstep for the last three months. That´s all well and good but still there is a question of price ratio between these metals. Platinum is very rare, I belive, probably 30 times rarer than gold. So, this is a problem. It costs maybe $5-10 per ounce to extract silver out of the ground and that may be inflated since there´s just so much of the stuff.
Being very generous I would posit that the platinum/silver ratio should be something like 100-1 in a real marketplace of price discovery driven by unmanipulated forces of supply and demand from the economy.
Dollar Devalued 50% will be the Headlines one morning when wake up.
Larry Summers said the dollar needs to be much weaker so we can stimulate exports and get out of this recession.
He may be right after all.
You have heard this spin from Wall Street and doomsayers a lot resulting in massive hoarding of cash waiting for falling prices.
Exports? Gimme a break. Did you visit a store today? Where did what you bought come from? Did you drive a car? Would falling import prices from a rising dollar hurt you?
A rising dollar is bad for U.S. multinationals since it results in fewer dollars to book back home as revenue and profits thus leading to lower stock prices. These multinationals dominate the archaic Dow Jones Industrial Average which then lead pretty much everything else. So you can see the agenda that drives this inflationary propaganda.
But it gets worse. This inflationary mindset they have been peddling in the face of massive deflationary forces has allowed them to totally overissue the stock market. You can see those penny stocks everywhere. Major stock watering scams are still down 60-80% from dot com bubble high. About a third of the DOW needs to write off worthless stock via reverse splits right now.
Reading these threads and as much of others as is within my capacity I´m somewhat belatedly moved to admit that the Federal Reserve and the powers that be and the illuminati and the aliens that control it all
are extremely oversold to say the least.
What if the FED is really trying to help the common man by maanipulating interest rates? Their newest twist clearly aims at lowering mortgage rates. They refrain from further capital injection to speculators blowing up impossible bubbles in economic input. Maybe they´ve seen the light. The economy desperately needs lower input costs. There are imbalances but it would be best to leave it to the marketplace to even those out. It will be painful for sure so you must concentrate on dissipating the pain of the many at the expense of the few. Poor vs. rich. That´s classic. Once the ratio of rich vs. poor reaches breaking point you have revolutions and mass executions. The only thing you the common man have in common with those masters of the universe is the urge of self-preservation. So it would be in both parts intersts to try to muddle through the present situation and avoid violent confrontation. It seems to me that the much maligned FED has been trying just that.
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We should try to build an independent business politics, independent from other states that are struggling with the financial crisis. I read some interesting information about that in one of Bradley Cohen's articles, I actually think that building this kind of independence is achievable.