German Lower House Begins Debate On EFSF Ratification, And Other European Events

Tyler Durden's picture

Today at 9:00 GMT, Germany is expected to vote on the EFSF in a much anticipated vote. Needless to say, while futures are slowly drifting higher on expectations of a favorable outcome, a negative vote will see the EUR plunge to parity with the USD and kill markets in minutes as it would mean that German politicians pick their careers over rescuing a failed monetary experiment and bailing out pathological big spenders and liars. As the BBC reports, "If more than 19 members of Mrs Merkel's coalition rebel against her, she will have to rely on the support of the centre-left opposition to pass the bill on new powers for the European Financial Stability Facility (EFSF)." And if she does that, we will have a rerun of Angela's ashes.

From BBC:

German Chancellor Angela Merkel faces a major test of her authority, as MPs vote on whether to approve new powers for the EU's main bailout fund.


Some of her coalition oppose committing more money to propping up struggling eurozone members such as Greece.


In Athens, protesting civil servants have blocked entrances to ministries.


The demonstrations come as international inspectors resume talks with Greece to decide whether it has done enough to receive more funds.


If more than 19 members of Mrs Merkel's coalition rebel against her, she will have to rely on the support of the centre-left opposition to pass the bill on new powers for the European Financial Stability Facility (EFSF).


The BBC's Gavin Hewitt in Berlin says that although the bill is expected to pass by a close margin, Mrs Merkel could emerge weakened, unable to hold her coalition together at a critical moment in the eurozone crisis.


Mrs Merkel's Christian Democrats (CDU) and their allies have been pressuring the handful of dissidents to get in line before the vote
at 11:00 (09:00 GMT).

Here is Bloomberg with a summary of all key European events: German lawmakers are set to back an expansion of the euro-area rescue fund’s firepower. Finland wants Europe’s permanent crisis management facility to start a year earlier than first envisaged. Unemployment in Germany likely fell by 8,000 in September, 8:55 a.m. Romania’s central bank will probably leave interest rates unchanged today. The Swiss National Bank will use “all measures” to defend the franc ceiling of 1.20 versus the euro, Vice President Thomas Jordan said. Investors expect the world economy to relapse into a recession, according to a Bloomberg poll.

  • ECONOMICS: Spanish CPI, 8 a.m. ECB’s Nowotny, 9:15 a.m. U.K. money sup- ply, 9:30 a.m. Euro-zone economic confidence, 10 a.m.
  • COMPANIES: The London Metal Exchange said it got more than 10 “expressions of interest” and may recommend a bid to shareholders as early as March.
  • GOVERNMENT: EU leaders start two-day meeting with officials from eastern Europe. Italian and Spanish financial market regulators extended temporary bans on short selling of financial shares. Norway’s central bank will force lenders to wean themselves off its deposit facility in an effort to spur interbank lending.
  • MARKETS: The price of options to protect against losses on equities from China to India and Brazil has surged to its highest since 2009 relative to U.S. contracts. (All times are in local time for London.)

And some pretty charts from Bloomberg Brief:

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Fips_OnTheSpot's picture

The voting on EFSF is expected for lunch, at 9am a further talk/discussion started.

Already quite "historic" blabla running from the politicans. Some are now no longer so fond of it, since the leveraging deal would rule them out of decisions.


Protestors before Bundestag showing transparents with "EFSF - Europe Finance Suicide Fund"

taraxias's picture

Same story, different day. The are not fond of it, they are outraged but in the end.....they'll vote for it.



Fips_OnTheSpot's picture

Oh, for sure it will pass. No doubt here.

reload's picture

BBC `Newsnight` politics & current affairs show had 3 talking heads on last night. 2 `think tank` types and a snaggle toothed woman from Shroeders Investment management. Their consensus was that not only is this a done deal, but the next round of `levering up` is a done deal also. And guess what - just like `TARP` they all said if it was not, then it would be the end of the world, unthinkable consequenses etc etc. When the presesnter Jeremy Paxman noted that `the German finance minister is publicly against using an increase in bailout funds as leverage` the consenseus from the talking heads was that `he has to say that at this point` - so as not to scare the sheep too much. This is classic, give them an Inch and they take a Yard stuff.

Paxman feigned incredulity `you mean the politicians are not being honest`? to which the Schroeders woman basicaly said - well they can not be at this point, because the outcome is going to be that Germany backstops the whole EU, France can not do it, Finland will not and so the outcome WILL be that the Germans pick up the whole tab.

The Germans are trying to bring the Frogs to the boil nice and slowly and if they get away with it the German people are going to be utterly screwed - and when they wake up, VERY ANGRY. 

Nussi34's picture

Which opposition? What Europe is concerned they all have the same wet dream: Endless jobs for politicians that have been kicked out in their home countries!

turicum's picture

Does someone know when the talk/discussion is over and the votes will be cast?

Fips_OnTheSpot's picture

Might take another hour.. no fixed schedule.

covert's picture

Germany is moving in roughly the right direction.


Western's picture

Krystallnacht Redux in 3...2...1...

Sequitur's picture

The German version of the Congressional "whip" was saying he has the vote locked, and it will pass.

Fuck Geitner.

JLee2027's picture

No surprise. Anytime it's brought to a vote by the majority, it's a done deal.

Fips_OnTheSpot's picture

Is the S&P downrating template already filled out for Germany? :)

jmcadg's picture

Another day trading on hopium no doubt.

mfoste1's picture

The EMU is going to dissolve anyways....why doesnt germany just say screw it and leave, go back to the deutsche mark.

Fips_OnTheSpot's picture

Because the german Bigcorps profit from this stupid currency union. The debts are paid by the sheeples.

reload's picture

Because a lot of powerful vested interests see this as the perfect cover for EMU to morph into Fiscal AND Political Union. They are working on it and will not rest till they get it. Its well known that this is NOT what the people of Europe want, but hey, fuck them. Think of the size of the Gravy train these bastards are creating for themselves and their Banking overlords - it is truly sickening.

willien1derland's picture

At very least the German vote will indicate if all governments are as arrogant as the US - Socializing losses & Privatizing Profits - I hope the Germans end the relentless game of 'No Debtor Left Behind'

LookingWithAmazement's picture

German Lower House will agree with the proposals. No Armageddon. Yaaaawn.

you enjoy myself's picture

the halflife of this latest rescue doesn't last beyond noon on thursday.  assuming /ES ramps another 10 points at 5am, every sane investor sells into the rally and GTFU before the weekend.  approving EFSF just ensures the collapse will be an order of magnitude greater than it otherwise would have been.  and it doesn't matter anyways since once the quarter ends there's going to be mass dumping by everyone (and the 1st of the month auto-gains have now been front-run for the last several months, so getting liquid is likely due for thurs/fri).

turicum's picture

Please excuse my ignorane, but I keep reading about "ES" and I have no idea what that referes to. Can someone explain?

Sequitur's picture

Futures market. Traded on Globex. Underlying is the S&P. Look up e-mini future.

Wolferl's picture

Why is the Bundestag the "Lower house" ? Germany doesn´t have a two chamber parliament. The "Bundesrat" isn´t a part of parliament. 

Nussi34's picture

I hope we will see a second Hitler emerging soon. I do not wish that he becomes pwerful, but his sole existance would scare the Europhiles to death and they will start to care about what the people think again.

anyways's picture


Done. Yes: 523 No: 85 Abstention: 3