FT Reports Europe To Sacrifice Its Banks To Bailout Sovereigns - Under €100 Billion In Bank Recap Funding Available

Tyler Durden's picture

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mayhem_korner's picture



Economists call this "scarcity."

hedgeless_horseman's picture



they have finally done the math and realize that to get the €2 trillion or so in EFSF insured capital they have to sacrifice their banks.

Have to?  No.  They will just sacrifice the EUR/USD and print more Euros, which makes Turbo Tax Tim smile.

LawsofPhysics's picture

Was thinking the same thing.  Timmy and Ben will get their inflation come hell or high water.

flacon's picture

"Sovereign" ----> most over-rated word of 2011

tmosley's picture

And simultaneously the most underrated word in modern history.

dlmaniac's picture

Who do we rape taxpayers for, bankers or Sovereigns? Hmmm, such a tough decision.

AldousHuxley's picture

it is more old rapes the young because they joined the ponzi earlier and rode the boom.

America with her corrupt selfish boomer leadership will soon become Italy in the future....


"To be frank," she said, "we've been a country in decline since the 1980s – had we but seen it. Actually, there are plenty of people, including in government, who still won't see it. All we can do now is try to manage that decline a bit better."

It's also a gerontocracy, she said, "run by the old, for the old. The prime minister is 76, the president is 87, the new head of the Bank of Italy will probably be a guy in his 70s, everyone in authority is old. I'm 49, and at the university I'm still considered 'promising'. So it's very, very hard for young people. I have former PhD students working in call centres." - Italian


smart young ones are already planning to move out.

Gadfly's picture

A false paradim really in light of our highly-interconnected financial world.  But if the choice were real and distinct, most would prefer to see the banks fail.  And then the sovereigns would become the banks... and then they would fail.

semperfi's picture

INFLATE -or- DIE ???
someone's gotta go back and get a shitload of printer cartridges

Smiddywesson's picture

Have to?  No.  They will just sacrifice the EUR/USD and print more Euros, which makes Turbo Tax Tim smile.

Half right.  They will print what they need to print, while they stack gold and prepare to ramp the price of that gold so their balance sheets, well, balance.  That's the rabbit up the sleeve.

eureka's picture

NO. I've been saying it for months: European sovereigns will nake their banks take haircuts - and - US banks will carry part of it, because they rigged both European sovereigns and EWuropean banks, and insured the fiat bubble with garbage paper CDS. 

Consequently EU and EUR prevails and US and USD goes down.

Watch carefully - it will happen last minute - and then very fast.

sushi's picture

Damp squib is UK speak for a wet firecracker. It won't go off. No bang. Weak phizz. Some wisps of smoke.

RichardENixon's picture

Sounds like what's been happening when I try to bang the old lady these days.

Getagrip's picture

I'm buying all the Euros 

I'm buying all the euros I can while they are still available! If they're good enough for Switzerland, they're good enough for me!!!!











LawsofPhysics's picture

What liquidity problem?  < snark >

hedgeless_horseman's picture




...for U.S. Treasuries and Gilts, which is the reason for the season of European discontent.

Oceania has always been at war with Continental Europe.

jm's picture

Long no fear of the printing press.

hedgeless_horseman's picture



Exactly!  There is nothing to be afraid of.  These two progressive humanitarians have shown the rest of the world how to manage inflation.




The Third Man's picture

From the article....


"The whole financing deal was set up on Chavez’s order by Chavez’s head of security, Gen. Henry Rangel."


General Rangel? Is that Charlies Rangel's brother? I knew there was something fishy about that family! ;-)

falak pema's picture

is she the next president with plastic boobs?

jdelano's picture

Seq--Noooooooo!  Don't join them.  It's a disease.  Like zombification.  

Speaking of which--you know how, in the zombie movie, the hero stabs the zombie through the eye or something and he thinks it's dead but after lying there a minute it roars back to life and attacks....that's this zombie market and the hero is ZH, which ought to alternately be called ZombieHeadhunter.  

Come on Zombie Headhunter, cut off the head, cut of the head!

mayhem_korner's picture

European leaders are due to ratify the plan at the weekend, alongside a broader sweep of initiatives to strengthen the eurozone,


Seems pablum is the precursor to hopium.  As Cris Carter would say...C'mon man.

St. Deluise's picture

buy the rumour

sell the squib

ZippyBananaPants's picture

lower colon.  haha.  you must mean spinkter hole


sabra1's picture

i thought he was refering to colon powell!

dr.charlemagne's picture

well......we certainly do find ourselves in quite a pickle. LOL

PianoRacer's picture

Origin of the phrase "damp squib"

While most modern squibs used by professionals are insulated from moisture, older uninsulated squibs needed to be kept dry in order to ignite, thus a "damp squib" was literally one that failed to perform because it got wet. Often misheard as "damp squid",[8] the phrase "damp squib" has since come into general use to mean anything that fails to meet expectations.[9] The word "squib" has come to take on a similar meaning even when used alone, as a synonym for dud.

Crisismode's picture

You are just reciting Wikipedia.


Please give credit.

ZeroPoint's picture

So when does this motherfucker pop? Give me a date dammit.

lizzy36's picture

So the take away is I am not getting my damn pony again this weekend.

Well moving on to "Wanting a Hippopotamus For Christmas".

fuu's picture

You have been bad this year Lizzy, nothing but coal for you.

Poetic injustice's picture

Vagons of coal for 12 hours/day. Future of many.

Mercury's picture



No market here kid...trades on the pinks!

zorba THE GREEK's picture

The ECB and the Fed will save the banks, that is their primary purpose.

And since Central banks can print money, consider it done. 

css1971's picture

Y'know. I don't really think the ECB is a central bank... I'm not entirely sure what it is, but it certainly doesn't behave like one.

qussl3's picture

Pretty sure its deposit facility and SMP had allowed the EZ zombies to hide the various levels of decay thus far.

mynhair's picture

Christ, why can't Europe start a 'Dancing With The Czars' TV program and go veg out!

chet's picture

Almost time for the Big Short Part Duex?

mayhem_korner's picture



I think the original will need a new title once this puppy goes paws up.

Mentaliusanything's picture

Passing the LIT SQUIB (Fire in the Hole)

streblo's picture

Squibs ignite explosives/fireworks. Damp squibs don't ignite. Hence, a damp squib means fireworks are expected, but nothing happens.



s2man's picture

If something is expected to have a great effect or impact but doesn't, it is a damp squib.

eBuddha's picture

and the idiots on CNBC have a link that asks "Has Market Sentiment Diverged From Reality?" -- suggesting people are just too negative.


jdelano's picture

I was cracking up when I read that this morning--clicked on it cause I thought CNBC was actually going to comment on how insane this rally has been.  Damn near pissed myself when I realized they meant that market sentiment is "negative"  (11% rallly?) while the realities (End of the free world) are positive....

heheheheheh actually, chuckling as I write this...