Here Comes The Non-Boring Weekend: G7 Says "Central Banks Ready To Provide Liquidity As Required"

Tyler Durden's picture

The G-7 is in full panic mode. The organization for the prevention of harm to the Status Quo was expected to release a communique possibly over the weekend, but the speed with which one was dropped for mass circulation is stunning and confirms that its members are in full meltdown as the weekend comes. It is now certain that the G-7 will attempt some major intervention over the next 48 hours to inject a last dose of hope into capital markets, or else the Monday open will be an epic collapse.

G-7 Statement on Tackling Slowdown, Supporting Banks

“We met at a time of new challenges to global economic recovery, with significant challenges to growth, fiscal deficits and sovereign debt, stemming from past accumulated imbalances.

This is reflected in heightened tensions in financial markets.

There are now clear signs of a slowdown in global growth. We are committed to a strong and coordinated international response to these challenges.

“We are taking strong actions to maintain financial stability, restore confidence and support growth. In the U.S., President Obama has put forward a significant package to strengthen growth and employment through public investments, tax incentives and targeted job measures, combined with fiscal reforms designed to restore fiscal sustainability over the medium term. Euro area countries are implementing the decisions taken on July 21 to address financial tensions, notably through the flexibilization of the EFSF, reaffirming their inflexible determination to honor fully their own individual sovereign signatures and their commitments to sustainable fiscal conditions and structure reforms. Japan is implementing substantial fiscal measures for reconstruction from the earthquake while ensuring the commitment to medium-term fiscal consolidation.

“Concerns over the pace and future of the recovery underscore the need for a concerted effort at a global level in support of strong, sustainable and balanced growth. We must all set out and implement ambitious and growth-friendly fiscal consolidation plans rooted within credible fiscal frameworks.

Fiscal policy faces a delicate balancing act. Given the still fragile nature of the recovery, we must tread the difficult path of achieving fiscal adjustment plans while supporting economic activity, taking into account different national circumstances.

“Monetary policies will maintain price stability and continue to support economic recovery. Central Banks stand ready to provide liquidity to banks as required. We will take all necessary actions to ensure the resilience of banking systems and financial markets. In this context we reaffirm our commitment to implement fully Basel III.

“We reaffirmed our shared interest in a strong and stable international financial system, and our support for market- determined exchange rates. Excess volatility and disorderly movements in exchange rates have adverse implications for economic and financial stability. We will consult closely in regard to actions in exchange markets and will cooperate as appropriate.

“We look forward to working with our colleagues in the G20 and the IMF in the coming weeks to rebalance demand and strengthen global growth. As previously agreed, structural reforms will make an important contribution in this regard.”



Translation: the great experiment in encroaching statism, failed monetary policy and central planning continues... Until imminent failure.


And select soundbites of last ditch desperation courtesy of Reuters:



"The G7 reaffirmed its comittment to safeguarding the solidity of sovereign ratings."

"We have to get away from the idea there is only one solution for all... It's not rigour versus growth."

"It was a G7 where everything was raised. There was no dead time."


"There is an extreme tension on the markets, what's important is that very strong measures are taken by governments concerned."

"It was really a meeting of great cohesion and force. There was a determination by everyone to meet challenges."


"The G7 sees a need for a concerted effort at global level in support of strong, sustainable and balanced growth.

"We must all set out and implement ambitious and growth-friendly fiscal consolidation plans rooted within credible frameworks.

"The G7 affirmed its interest in a strong, stable international financial system."



"It is completely within the capacity of the stronger members of the euro area to absorb those costs. Those costs would be much, much greater for them and their economies if they sit here and do nothing and they recognize that."


"I hope we would all agree we have to stay the course, that we have to go through the pain of fiscal consolidation. It's not easy, it creates stresses in some countries, but it's necessary, we have to get through this rough patch.

"There's no point kicking the can down the road. If we don't deal with it now we'll have to deal with it later and we know that these problems do not get better with the passage of time."


"We support the United States in its work so that the U.S. recovery can continue, while in Europe we have our own challenges related to fiscal consolidation and restoring confidence in the European economy."

On bank funding:

"Solutions should be found from private markets, from private investors and if that is not is possible there should be national backstops in place to ensure recapitalisations or restructuring for these banks."

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Mactheknife's picture

Like Margaret Thatcher said "The problem with Socialism is that sooner or later you run out of other people's money".  Guess what Greece?

Smiddywesson's picture

Collapse now or collapse later, what's the difference?

The only real difference is measured in how much gold the central banks stack.  Stack more and survive, stack less and control slips out of their hands.  Therefore, more can kicking.

MsCreant's picture

Cancer is a growth Rocks.


RockyRacoon's picture

Happiness is wanting what you have, not having what you want.

I've never understood the need to "grow" but I've learned that it is necessary if one wants to perpetuate the debt-driven system.   That system is now dying.   Bu-bye!

Shell Game's picture

I've never understood the need to "grow" but I've learned that it is necessary if one wants to perpetuate the debt-driven system.

Rocky, you outlined nearly the entire systemic problem with that sentence.  Agree, agree, agree.

LeBalance's picture

You gots to have more than you can get to make it go.

That why it can go no mo.

Arkadaba's picture

I never have understood it either which is why if I ever had a company, I wouldn't want it to go public (unless I was going to sell it and make a lot of money). Once you have shareholders, they want increased profits over everything (as is their wont) but what happened to a steady dividend over the years?

knukles's picture

So that's where I went wrong as a child.  My mom had kept me comapny and later in life I sold her.  Never had any regrets.  A few calls and letters demanding refunds, but no regrets. 

infinity8's picture

"if you're not growing, you're dying!" - always disagreed w/that b.s., makes me crazy. I can agree with "if you're not changing/evolving/improving, you're dying" but not the whole bigger is better crap.

akak's picture

The only thing in nature that grows without inherent limits is cancer.

Is that really the model upon which we want to pattern our economy and our society?

RockyRacoon's picture

To extend the metaphor:  It always kills its host as well.   Painfully, and with innocent members being cannibalized of their energies and functions.   There ya have it.

Arkadaba's picture

When I was reading your post, a moth landed on my arm. Really. I gave it a puff of wind.

Smiddywesson's picture

When you consider that the available pool of customers waxes and wanes, both in their numbers, and in their ability to shovel out money, bigger is better is shown for the idiocy that it is.  For the good fo the company that is, not the CEOs who collect big bonuses from growth like that asshat Jack Welch who ruined GE.

New_Meat's picture

Dude, u goin' all Zen on us?  I've met playaz' who have, or have been in the zone of playaz:

Start here, it was Sam's PhD. thesus in (not Economics!) Chinese Studies at Oxford.  Back when ..., well all y'all can investigate this Honorable American Hero, if you wish.

- Ned

(and you can find his book everywhere, but it is a) simple, b) complex beyond all understanding, and c) better than all other translation attempts}

{{ Sam was i) a Playa and b) had sufficient integrity to do the job, in many circumstances}}

{{{Americans might wish to look up/acquire his other books}}}

disabledvet's picture

yeah well just because i want her really bad and she's mine doesn't mean i'm gettin' any tonight either.

fishface's picture

I've never understood the need to "grow"

Thats why you're a tiny racoon, but a happy one ;-)

Nascent_Variable's picture

I wish just once that these assholes would say precisely what their vision of an endgame is.

Printing and bailing out to infinity can't possibly be it, even by the twisted logic of the central planners.  They must think another bubble will come along to keep the gravy train running, a la Krugman circa 2002 calling for a housing bubble.  Of course that's ridiculous, but they need to be pinned down on it.  The theory of perpetual growth through excascerbation of the boom/bust cycle needs to be seriously debated on the global scale.

T1000's picture

They got no other answer. There is nothing else they can do. They got one solution: print there way out. First it will be billions, then trillions, then quadrillions, then quintillions, up to centillions, bitches!

they'll give you all the fancy pants, phd reasons you need to believe them, but this is the end game. Prepare accordingly!

akak's picture

A government scorpion asks a citizen frog to carry him (and his printing press) across an (inflating) financial river.  The frog says "No, if I do that you will start wildly printing money in the middle of the river, and kill my savings and standard of living." The scorpion says "Do not worry, I would never do that, or I would thereby fiscally drown as well."  The citizen frog reluctantly agrees to carry the government scorpion across, only to promptly have the government scorpion fire up his printing press in the middle of the river.  "Why did you do that?", asked the citizen frog, as they both began to sink, "now you have doomed us both".  To which the government scorpion replied "I could not help it --- it is my nature."

New_Meat's picture

akak, I see that you, too, are afflicted with the "pussy, junksa' attraction" disease.  Why, this is a well known arab parable of "couldn't help myself" situation.  How could anyone junk that???

- Ned

akak's picture

After the anti-gold trolls fled the site earlier this year, having utterly and completely discredited themselves, the deflationary trolls are now coming out of the woodwork to pick up the pro-Establishment propaganda baton.  I suspect that my junking here is from one of them.

tmosley's picture

Bob is playing the anti-PM troll again as well.

As if anyone cared.

akak's picture


Could I have missed one?

You're not talking about TexasGunslinger/LongJuanSilver/RedneckRepugnicant/WilliamtheBastard, are you?
Funny that that one seems to have finally flown the coop.

Smiddywesson's picture

They got no other answer. There is nothing else they can do. They got one solution: print there way out. First it will be billions, then trillions, then quadrillions, then quintillions, up to centillions, bitches!

Right and wrong.  There is nothing they can do to fix THIS system, but they are completely in control to set up a new system.  They are not going to commit suicide and let us free.  It will never happen.  They know there is no way to pay off these debts.  Once you reach that point, it doesn't matter how much debt is racked up to kick the can.  The one long term action they are taking is buying gold. That's their answer. Either you have gold or you have nothing under the system that is coming.  

DosZap's picture

Smiddywesson  @ Sat, 09/10/2011 - 09:55 | 

I am amazed that some of the folks here (esp here) do not get it.

Thinking they are trying to save this system is NOT the agenda.

Making it unbearable is the goal, till nearly ALL BEG for a new one is.

DeadFred's picture

The end game is printing and bailing out for as long as possible to give the elites more time to steal and take control of as much as possible. He who controls the assets after the reset wins.

TheFourthStooge-ing's picture

The end game is printing and bailing out for as long as possible to give the elites more time to steal and take control of as much as possible. He who controls the assets after the reset wins.

...and the elites that are hanged from lampposts lose. Thus is balance restored.

Long strong stout ropes.


Smiddywesson's picture

He who controls the assets after the reset wins.

He who controls the asset by which all other assets are valued wins, gold!

There, fixed it.

LeBalance's picture

Their vision for the endgame is desperate people manning their war machines, putting on Haz-Mat suits and rushing the lines of the other desperate groups of people.  Clubbing eachother to death for a scrap of paper nothing and holding the meaningless trophy high overhead to the growls and grunts of their fellows.  Brutes, heroes, sheep warriors!  Yarrrrrr!

11b40's picture

Pined down?  How can they be pinned down?  They only talk to one another.  When glimpsed in public, they are between some location's front door and the open door to the waiting Limo.

Actually, I was thinking 'strung up' instead of 'pinned down'.

max2205's picture

Derivatives fuse is just starting the exponential burn

Jumbotron's picture

What else can you do other than print money when you have a 600 trillion dollar derivative hoie to fill?

I read somewhere a couple of years ago that if you calculated the entire worth of the world and sold it to aliens it would only come out to 400 trillion.

The debt hole to be filled by printing fiat is not only huge, it's cosmic.

Chaffinch's picture

Would they try and fob us off with some extra-terrestrial fiat paper money? I don't reckon we should take their first offer, even if it is shiny beads or something!

Jumbotron's picture

Shiny beads of Di-lithium Crystals would at least solve Peak Cheap Energy.

"SULU !  Let's boldly go find some hot, green alien chicks you're gay."


bid the soldiers shoot's picture

They may have been looking for hot, green aliens ... but necessarily chicks.

Wikipedia: "Roddenberry often humorously referred to Captain Kirk as "Horatio Hornblower in Space"."

Res ipsa loquitor.

bid the soldiers shoot's picture

Don't we have a 12% interest in the Sun? That should be worth something to the Alien corporate raiders.

CrashisOptimistic's picture

They can ease and print all they want.  It won't matter.  It will push on the string.

There is insufficient oil and nothing can be done about that -- except reduce population rapidly.

But another thing . . . does anyone remember a time when there was this kind of panic from central bankers and politicians at any other point in history with GDP growth of 1%?  Did anyone ever panic prior to year 2000 over 1% growth?

Answer: No.  1% is not disastrous in and of itself.  But when the system is configured to break down (pension funds MUST have +8% markets each year minimum to make their payments) at less than 8+% S&P, it's disastrous, and panic is required.

Sequitur's picture

Exactly. I cannot remember a time in the markets when there was so much "intervention" day-to-day, hour-to-hour.

IQ 145's picture

no, no; definetely not. not in the last forty years. The Euro was a joke to begin with; but it will cause a huge "Tidal wave" of human psychological reaction when it goes "Pop"; (as in bubble gum); or simply "hisssss"; either one.

whstlblwr's picture

Don't underestimate panic from Ron Paul doing well in a poll. A new independent poll today and he is even with Romney ahead of Perry.

If anything happens to him, there will be major unrest and civil problems, he becomes the martyr, so they better not try it.

Troll Magnet's picture

I LOVE Ron Paul as he is the only one uniquely qualified to start getting us out of this mess - He won't fully get us back on track even if he serves two terms, but he will put us on the right path.  But as a gold/silver owner, I have to wonder if his getting elected will be good for PMs or bad for PMs.  My thinking is that it'll be bearish for PMs if he's elected President because as long as he wants to put in a sound monetary policy, he has to make sure that gold and silver prices are within everyone's reach.  Or at least as many people as possible.  Am I wrong?  

Prometheus418's picture

"Bearish for PMs," sure.

But, what the fuck do you want?  Personally, I'd be thrilled to return to a US that is the innovative powerhouse of the world, where hard work and due dilligence lead to success, and silver costs $1/oz- not because I want my silver to be "worthless," but because I want the "full faith and credit" of the United States to mean something more than a sick joke again.

We all stand to gain far more by having a strong and stable system where anyone who is willing to work can thrive, than any one of us stands to gain from having a pile of shiny metal, and that is the whole point.

Anyone buying PMs as a hedge, and not a trade, should be praying that the investment tanks.  Right now, I could lie, cheat and steal to gain as much gold as I can, but no matter how much I might gain in nominal terms, my standard of living would decrease.  I would far rather be a basic citizen in the US than be a king in a new dark age.

And it's important to bear in mind that the "gold standard" is the one that matters, not the dollar standard.  How can you really care what number is applied to your Ozs?  Whether that number goes up or down, you're still going to get what you always got when you trade that shiny metal in.

Jumbotron's picture

Really...Whstlblwr ?

Who gives a shit about that useless blow hard who named his kid after that pyschopathic, serial killer admiring bitch Ayn Rand?

The rest of the herd will temporarily look up from grazing on American Idol and Chaz Bono on Dancing With The Stars to see the Jack Boots stomp the shit out of you all and then go back to grazing with a shrug and a "Well, it sucks to be them.  They shouldn't have rioted....terrorist, Ayn Rand loving freaks !"

Oh...and don't get me started on Ayn Rand.  Became obseesed with her in the 6th grade after wondering why my new favortie band at the time...Rush....and their drummer Neil Peart....had dedicated the album 2112 to her in 1976.  Wrote numerous term papers and essays on her in high school and college.  Read all her books.

Simply put...Ayn Rand was so traumatized by her experience in Bolshevik Russia and so helpless and contolled by the circumstances that she conflated her desire for relief from that situation and her desire for control into a pseudo-intellecual philosophy and a worldwide movement (cult) called Objectivism.

In fact...she was such a psychopath, that she modeled her vision of the Nietzschian "Superman" after William Edward  Hickman, a serial killer in the 1920's who after already murdering and cutting in half a 12 year old girl, convinced her father that if he paid the ransom he would return his daughter to him unharmed.  The father agreed.  Only to find out to his horror when Hickman dumped the girl's bisected body that Hickman had already killer her, stuffed her abdominal cavity with a towel, propped her up in the car and sowed her eyelids opened to make it seem she was awake and alive as he drove through town to the drop off point.  All the while throwing out other body parts along the way.

Granted...Rand did not look at his actions as good and noble....but she wrote numerous things in her journals about that most admirable quality that drove Hickman's psychosis....his absolute, unflinching rational egoism. 

One psychotic admiring another.  Birds of a feather.

So here we are in America, surround by psychotics like you who believe there will be "major unrest and civil problems" when the psychotic Ron Paul is taken out by an equally psychotic fascist government ruled by psychotic collectivists and psychotic Randian banksters.

Yeah....right.  That's a recipe for success.  LOL !

bid the soldiers shoot's picture

Thank you for sharing.

What did we miss if you had got started on Ayn Rand? Catch us up next time, will you?

Thanks again.

Jumbotron's picture

Nothing you could handle....

like the truth.

bid the soldiers shoot's picture

Are you trying to tell me AR was worse than Pam Geller? You can water board me and I won't agree with you.