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FT Rumor Time: Stress Test III: The Search For Spock (Or Optimal Greek Haircuts)
In line with what Merkel hinted at early and appropriately early for the US close, the FT has just put out a headline with regard to a new set of stress tests (yes those ever-so-trustworthy self-inspected exams) to better understand the impact of a larger than expected Greek haircut. This makes sense given the market trading massively below prior stress test or PSI levels but perhaps the craziest thing is what this is supposed to achieve - remember its not so much Greece per se as the message that a restructuring sends to any and all indebted European nation...cue EUR at week's high levels?
From the FT: EU Banks face new 'Greek' stress test
European Union finance ministers have asked the bloc’s leading bank regulator to test the strength of Europe’s banks on the assumption of a big writedown on Greek sovereign debt.
The move, a tacit admission that the European Banking Authority’s two previous rounds of bank stress tests were not sufficiently robust, came as Angela Merkel, the German chancellor, said she was prepared to recapitalise her country’s banks if necessary. She suggested she wanted to discuss joint EU-wide bank support efforts at an EU summit in two weeks.
“We’re under the pressure of time and I think we need to take a decision quickly,” Ms Merkel said after meetings with the European Commission in Brussels.
According to senior officials involved in the process, the EBA has been instructed to provide a country-by-country breakdown of how much new capital banks would need in the event that Greece’s bonds were written down.
And so on.
This time the Stress Test will work, and Spock will be found, damn it Jim!
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Anything, no matter how stupid, that buys time si more then welcome! Right?!?! Yet, time, time for what? More looting? Guess YES! The only way to get tihis fixed it to kill the rich, which saint happening at least not voluntarily :)))!
Hair cuts my ass! I have yet to see a rich fuck take a write down on his "investment" voluntarily!
Michael Lewis (and especially Kyle Bass) are predicting either Germany is leaving the EU, essentially wiping out the EUR, or that Germany is going to impose its total will on EU bondholders (massive haircuts) after pounding PIIGS+France into complete austerity and financial reformation (good luck with that); either way, it's not a pretty picture that the future has in store for the global, and especially European, economies:
How The Financial Crisis Created A 'New Third World'
You self-obsessed pompous bastards should take a minute every so often and give a cyber-five to Tyler for the funny shit he writes. 'Stress-test III:The Search for Spock'. I snotted all over my keyboard when I read that...
The Tylers' wit is evident to all (and probably taken for granted by many at this point, admittedly).
MICHAEL LEWIS: Greece Is A Society In Total Moral Collapse
Must see interview with Lewis on how grave the EU situation really is (two short videos)
Chorus: How grave is it?
It's pretty damn grave.
Watch these two videos interviews of Lewis on the EU crisis, and because they lay out the crisis in such easy to understand ways, try and think of a scenario where PIIGS+France+UK does not ultimately become Lehman*500 (or 1,000).
http://www.thedailyshow.com/watch/tue-october-4-2011/exclusive---michael...
http://www.thedailyshow.com/watch/tue-october-4-2011/exclusive---michael...
Reverse "Chicken Little"!
We have the solution, ok today we have it, ok now we have it, verbally kicking the can down the road!
Why does everyone keep beleiving these pronouncements and buying stocks because its all gonna be fine now.
WE HAVE THE BIGGEST DEBT IN ALL HISTORY AND IT WILL NEVER BE PAID BACK.
This is just the start, and until politicians start letting mismanaged banks go bust and press reset we will throw good money after bad just like Japan has for the past 22 years.
We need Argentinian economic resolution, not Japanese, Austrian or Keynyan.
Lets see Dexia passed the test conducted 4 months ago.
Allied Irish Bank passed the test conducted 4 months before it defaulted.
Color me skeptical on EU "goal seek" stress tests.
Oh yes and since after the last round banks were supposed to raise $2.3B (a tad shy of the $200B the IMF said they need and really shy of the $1T goldman said they needed) and haven't raised a penny, someone remind me what the point of the "Stress Tests" are.
someone remind me what the point of the "Stress Tests" are.
I know, I know: So Goldman can call its clients and get them to pour capital into European banks that will all have naturally passed with flying fucking colors? And to move the ponzi market higher, if only but for another day?
BTFD - Bury the Feces Deep
hey, lizzy!
perhaps it is pelosiism for "do something"?
If they dont hurry up, this stress test will just be overthrown by reality... anyway the result of Test3.0 is irrelevant.
whiskey tango foxtrot
When all else fails, order another round of BS!
Sierra November Alpha Foxtrot Uniform.
Foxtrot Uniform Bravo Alpha Romeo.
(Translation for those of you who may not understand or be slightly inebriated - SNAFU - Situation Normal All Fucked Up - Fubar - Fucked Up Beyond All Recognition.)
Now do you think if they got Baghdad Bob to announce the results it would make them more credible?
pods
Even Baghdad Bob would tell them to fuck off. Lies of this magnitude are below his minimum acceptable credibility threshold.
should we go EURO long?
'Merkel, the German chancellor, said she was prepared to recapitalise her country’s banks if necessary.'
Hahaha! next thing ya know, they'll be inviting timmah back for new ideas!
My theory is that something was lost in the translation of recapitalize, thusly:
re - to do again
capita - head
lies - deliberate untruths and deceptions
I think what she really meant was, "we, the heads (of governments, ECB, EU, etc.), are prepared to lie repeatedly until we're believed."
Haha! gd1, 4th_S_ing!
so they will be inviting timmah back!
is it only me? i? moi? the NWO seems to be searching for a very compelling story to switch the narrative from its present "we are fuked" to a new level of "you are fuked"?
Let Them Fail! [accept no substitutes!] they are fuking banks, not immortal mythic heroes/gods to whom we must sacrifice everything for generations, for ponzi pete's sake!
Btw, Greece's "statistical office" made a small little revisions to their GDP for years 2005-2010. Wonder what the new deficit figures will look like... Press release can be found on their website.
http://www.statistics.gr/
Sorry for the Off Topic on the Greece Farce, Rumors, Lies & Innuendos (deja vu), but Robert Reich (whether one does or does not like him) has written an outstanding summary of the whos, whats, whys and others s's of the reason a bail out of Eurozone PIIGS+France+U.K. slop is really a bailout of....
....ta da!!!!! Wall Street!
The essential and quintessential guide to the what's really driving the EUROSLOPPIIGSFUK bailout (hint: Governments & citizens have almost no exposure to defaults; banks and investment firms like MS have MASSIVE exposure):
ROBERT REICH: Behind Europe's Debt Crisis Lurks Another Giant Bailout of Wall Street
Check out the greek riot cop cold cocking the photojournalist in the face...pow!
http://www.reuters.com/article/2011/10/05/us-greece-strike-idUSTRE79449L...
Modernized SATs:
"There's no place like home, there's no place like home, there's no place like home" is to "This is not 2008, this is not 2008, this is not 2008" as:
a: unicorn queefs are to leprechaun farts
b: expelliiarmus is to stupify
c: 'yes we can' is to 'you must pass this bill'
Any and all rumors about Europe have a direct and immediate impact on:
Gold, ES, AUD, EUR, Crude, as if they were all wrapped and tied together with velcro tape.
I don't think this bullshit is working anymore. A lot of smart money is shorting credit on every uptick. Considering the possibility of a bazooka, that's impressive. Is it on and it can't be turned off?
go read Hussman's piece and you'll see why. He makes a pretty case for why a Bazooka is damn near impossible.
http://www.youtube.com/watch?v=h2Xvqo491Fg&feature=related
Damn! Star Trek was FRUITY!
Greek minister Haris Kastanidis in Parliament said calling a Referendum about the crisis.
End game closer
http://www.eleconomista.es/flash/noticias/3428870/10/11/El-Gobierno-griego-planea-convocar-un-referendo-popular-sobre-la-crisis.html
+40oz delivery
In other words: What happens if we cut Greece loose?
Of course, these stress tests will assume that the bigger haircuts for Greek debt will have no effect on any of the other PIIGS.
Of course. Just like IMF's Borges said today, Spain and Italy are totally solvent. They are only victims of "market's risk aversion". And yes, he is a PhD.
<golf clap> on that headline.
Forget Star Trek, look to the Dukes of Hazzard with Boss Hogg and his ingenious ways of enriching himself at the expense of everyone else:
http://www.youtube.com/watch?v=iO4gPCpws60&feature=related
Why does this smell like the Versailles Treaty, in reverse?The history of Europe is one country trying to pound the rest into the dirt. This has more split ends than a bad hairdo.
http://georgesblogforum.wordpress.com/2011/10/05/war-under-heaven-the-world-at-commerce-update-10052011/
"remember its not so much Greece per se as the message that a restructuring sends to any and all indebted European nation.."
While I do agree, I can't help but wonder about what would happen if the European bankers work in an even more perfect unison with the Greek administration in order to impose even more inconceivably absurd austerity measures.
Because even if I do feel sorry for the investors who commited their capital in the most high-risk investments while maintaining their own non-risk environment attitude, I think that they can squeeze some more juice out of the completely dismantled and pillaged, to the point of totality, Greek corpse of a society.
Because I hear that some families can still afford bread and perhaps the ability of food refrigeration, and that the faint scent of a Democratic instituion still has a miniscule probability of resuscitation.
And of course all that gambling/speculation-derived wealth losses shant regenerate themselves.
so.. yeah..
Sincerely
Here's my latest blog on a similar topic: the renegotiation of Greece's bailout plan and bond swap.
http://how-to-trade-armageddon.com/2011/10/05/watch-the-isda/
"I still doubt, as I wrote in my Sept. 28 blog post, “Germany nudges Greece towards default”, that the ISDA could get away with calling the 50% haircut that is being discussed “voluntary”. That just strikes me as absurd, and what’s more, potentially devastating to CDS markets. CDS would come out looking like the Monty Python insurance salesman’s “never pay” policy."
Mr. Market, "how can you let this go on?"
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