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Greece Issues Statement On PSI, Says €172 Billion Of Bonds Tendered In Swap, Will Enact CACs, ISDA To Meet At 1pm To Find If CDS Trigger

Tyler Durden's picture




 

The biggest sovereign debt restructuring in history is now, well, history. The headlines are finally come in:

  • GREECE ISSUES STATEMENT ON DEBT SWAP
  • GREECE COMPLETES DEBT SWAP
  • GREECE SAYS EU172 BLN OF BONDS TENDERED IN SWAP
  • GREECE GETS TENDERS, CONSENTS FROM HOLDERS OF 85.8%
  • GREECE SAYS 69% OF NON-GREEK LAW BONDHOLDERS PARTICIPATED

We learn that €152 of the €177 billion in Greek law bonds have tendered, which is 85.8%. This means that €25 billion in Greek law bonds have not - these are the hedge funds that could not be Steven Rattnered into participating, and will now sue Greece for par recoveries.This is also the number that ISDA will look at today to determine if, in conjunction with the CAC, means a credit event has occurred.

And yes, the CACs are coming, as is the Credit Event finding:

  • GREECE SAYS WILL AMEND TERMS OF GREEK LAW BONDS FOR ALL HOLDERS

As a reminder from February 24:

Finally, as we have said all along, it is the UK-law bonds that are the fulcrum security here:

  • GREECE TO EXTEND NON-GREEK LAW BOND OFFER PERIOD TO MARCH 23

And here is Veni:

«On behalf of the Republic, I wish to express my appreciation to all of our creditors who have supported our ambitious program of reform and adjustment and who have shared the sacrifices of the Greek people in this historic endeavour. With the support of our official sector and private creditors, Greece will continue implementing the measures needed to achieve the fiscal adjustments and structural reforms to which it has committed, and that will return Greece to a path of sustainable growth. Our invitations to offer to exchange, and submit consents with respect to, foreign law governed will remain open until 23 March 2012, after which there will be no further opportunity for creditors holding those instruments to benefit from the package of EFSF notes, co-financing and GDP linked securities which form an important and integral part of our invitations.»

Full release:

 

 

And ISDA is not wasting any time: it will meet at 1pm GMT to "discuss the question and to determine whether a credit event has occurred."

 

 

Finally, as a reminder, the ISDA vote today will be made by the following dealers and non-dealers. It will be up to them to decide if they wish to destroy the last trace of "integrity" of the CDS market and in effect commit institutional suicide. Because if they do in fact find that there has been no trigger event, then watch CDS bases go negative across the board, as any last pretense of CDS as a hedging instrument is thrown overboard, and the only "hedging" instrument left is to sell.

EMEA

Voting Dealers
Bank of America / Merrill Lynch
Barclays
BNP Paribas
Credit Suisse
Deutsche Bank
Goldman Sachs
JPMorgan Chase Bank, N.A.
Morgan Stanley
Societe Generale
UBS

Consultative Dealers
Citibank
The Royal Bank of Scotland

Voting Non-dealers
BlueMountain Capital (Second Term Non-dealer)
Citadel LLC(First Term Non-dealer)
D.E. Shaw Group (First Term Non-dealer)
Elliott Management Corporation (Third Term Non-dealer)
Pacific Investment Management Co., LLC (Second Term Non-dealer)

 

 

...And finally, congratulations to all Greek pensioners. You have now all been Corzined. Further instructions will be mailed in your next monthly pension statement.

 

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Fri, 03/09/2012 - 02:34 | 2238752 hangemhigh77
hangemhigh77's picture

Greeks are praying for Zeus to return and strike the Parliment building with a bolt of lightening.  It could happen.

Fri, 03/09/2012 - 02:39 | 2238765 hangemhigh77
hangemhigh77's picture

Well, now that the Greek problem is solved and all is well what's next on the agenda? Conjuring up Lucifer and driving to Spain?  ROAD TRIP

Fri, 03/09/2012 - 02:58 | 2238767 BlackholeDivestment
BlackholeDivestment's picture

...eh. what can be said at this point? The whole damn thing is embarrassing.

Fri, 03/09/2012 - 02:41 | 2238770 hangemhigh77
hangemhigh77's picture

Greeks, the assclowns of the world

Fri, 03/09/2012 - 02:42 | 2238772 Fips_OnTheSpot
Fips_OnTheSpot's picture

Schaawiiiing

 

Goodbye EYPO

Fri, 03/09/2012 - 02:46 | 2238789 Yen Cross
Yen Cross's picture

 Ok we understand the Greeks!  Hold and add to your short positions. We may have a disorderly default over the next week.

  Mark March 20'th on your calendars

Fri, 03/09/2012 - 02:48 | 2238795 chindit13
chindit13's picture

Tyler,

Maybe the way to look at this Greek bailout is not as a bond swap or even a default, but rather it is an M&A deal.  The EU grossly overpaid for merging with Greece, and this created a bucket load of goodwill that has to be amortized.  This first debt swap is the first amortization charge.  The fact that the ‘when issued’ new bonds are already trading well below par indicates this will be an accelerated amortization schedule.  Eventually all the goodwill will be written off, and then there will be a divestiture of Greece (from the EU).  And just like in the M&A market, IBs take a fee coming and going.

Fri, 03/09/2012 - 02:52 | 2238804 Tyler Durden
Tyler Durden's picture

Please don't lose sight of the big picture for a second: the whole purpose of the Greek "deal" was to activate the Greek Escrow account (aka bailout... of European banks) in a way that Greek underfunding will receive 'equitable treatment' in gold as the Greek constitution already allows. This is a deal: one to confiscate Greek gold and to set a precedent for further gold confiscation.

Fri, 03/09/2012 - 02:56 | 2238811 Yen Cross
Yen Cross's picture

That pesky Rail Road!

Fri, 03/09/2012 - 03:04 | 2238824 chindit13
chindit13's picture

Thanks.  I won’t, and didn’t, lose sight of it.  Again, like any M&A, the point is to suck out whatever value can be gained from the acquired company, then once drained, toss out the empty carcass.

Fri, 03/09/2012 - 04:25 | 2238905 bob_dabolina
bob_dabolina's picture

We are so cavalier discussing the lives of people we've never met.

I still havn't figured out why people choose to fight the market (swimming up-stream) but by god it happens.

...oh well

Fri, 03/09/2012 - 05:56 | 2238968 falak pema
falak pema's picture

the market is now a polluted river; you swim at your own risk. One day there will only be dead fish in this river; a lake Aral or Atlantis, forgotten continent. Its time to charter a new course and junk the market of junkies hooked on fiat pumped steroids.

Fri, 03/09/2012 - 08:00 | 2239069 williambanzai7
williambanzai7's picture

What we have is price manipulation, not discovery.

Fri, 03/09/2012 - 08:11 | 2239085 chubbar
chubbar's picture

Absolutely, and one day the taking of Greek gold for the paltry sum of a few hundred billion will actually be acknowledged for the swindle it is.

Fri, 03/09/2012 - 02:49 | 2238797 barliman
barliman's picture

 

Surreal

Live from Paris amd young fellow "with an outrageous French accent" breaking down French bank participation and charges taken in anticipation of haircut

"We are expecting a political reaction of relief."

RUN AWAY!!!!!

barliman

Fri, 03/09/2012 - 02:51 | 2238802 cranky-old-geezer
cranky-old-geezer's picture

 

 

95% of bondholders caved, taking a huge haircut. 

Greece fucks everybody again (except ECB of course).

Ok, now we know what Spain, Ireland, Itally, etc, will do.

Why anyone would buy Euro(trash) bonds anymore is beyond me.  

Fri, 03/09/2012 - 03:30 | 2238861 lolmao500
lolmao500's picture

 

Greece fucks everybody again (except ECB of course).

Hmmm no. Whoever bought Greek bonds fucked themselves.

Idiots and their money are easily separated.

Fri, 03/09/2012 - 05:03 | 2238937 GernB
GernB's picture

Well, most financial transactions are predicated on the idea that contracts are legally binding and enforceable. While it might be reasonable to expect investors to realize there's more risk in Greek bonds than is reflected in their rating, I'm not sure how reasonable it is to expect Greece to destroy contract law and with it the CDS market and any pretense that sovereign debt is anything but a crap shoot.

Fri, 03/09/2012 - 05:52 | 2238964 lolmao500
lolmao500's picture

It's not contract law. Is it contract law when you buy a stock and it drops in value?? Should the company pay you back??

The bond holders made a bad investment, they lose their money, period.

Fri, 03/09/2012 - 02:55 | 2238809 barliman
barliman's picture

 

Weeeeeeeeee Weee Weee Weee WEEEeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee

Talking head, "One commenter noted this was as voluntary as a confession to the Spanish Inquisition."

Cut to different blond (strict, pretty teacher look) in red (German accent?), "That comment is completely accurate."

WEEEeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee

Back to studio, "When you have these banks saying all these positive things, you have to smell a rat. The obvious quid pro quo was the LTRO money"

Weeeeeeeeeee

THIS was worth staying up for!  PPT stepping in on FX and futures.

barliman

Fri, 03/09/2012 - 03:10 | 2238829 Essential Nexus
Essential Nexus's picture

Thanks for staying up to inform us.  Much appriciated. 

Fri, 03/09/2012 - 03:15 | 2238832 slackrabbit
slackrabbit's picture

Q: Are you pregnant?

A: Sort Of

 

Q: Is the person dead?

A: Soft Of

 

Q: Is the Greek deal to rob the Greeks of their gold, steal from bond holders and destroy the Rule of Law?

A: No Commment

 

Max Keiser: "This was as voluntary as a confession in the Spanish Inquisition."

Fri, 03/09/2012 - 03:14 | 2238835 Zgangsta
Zgangsta's picture

No credit event, because those people voluntarily bought bonds that Greece could make worthless at any time (the fact that they did so retroactively being irrelevant...)

Fri, 03/09/2012 - 05:27 | 2238953 GernB
GernB's picture

The Greek government entered into a legally binding contract. Sure they can beach the contract at any time, just like I anyone could rob a bank at any time. However, each action has consequences, because at the end of the day the people doing the investing have other choices and if nothing else will choose to sit on cash before they will risk having it taken away by countries reneging on their obligations.

Fri, 03/09/2012 - 03:15 | 2238836 Yen Cross
Yen Cross's picture

I guess someone could toss a bridge loan in there. ( SOROS)? Ultimately this sends a BAD example!

Fri, 03/09/2012 - 03:19 | 2238841 Yen Cross
Yen Cross's picture

 The aud/usd actually caught a bid on the news.  Shit bag numbers and the RBA is going to lower rates 50BPS and that caught a bid?

Fri, 03/09/2012 - 03:20 | 2238845 barliman
barliman's picture

 

Take away ...

When the shit DOES hit the fan in Europe the nationalistic animosities will sweep everything before them like Japan's tsunami last year

They've moved on to discussing how inflationary the rise in oil prices are going to be.

New guest said something the German MS guy didn't like ... his left eye is twitching ... really creepy and kind of Dr. Strangelove-ish.

barliman

Fri, 03/09/2012 - 03:21 | 2238846 lolmao500
lolmao500's picture

What it means : EITHER WAY, THEY ARE FUCKED.

Choice 1 : Accept CDS trigger : KABOOOOOOOOOOOOM.

Choice 2 : Say it isn't a CDS trigger when it truly is : KABOOOOOOOOOOOOOM.

Either way, the system is kaboom.

The only way to get out of those two choices is to force people to accept the PSI deal.

Fri, 03/09/2012 - 03:28 | 2238860 Yen Cross
Yen Cross's picture

I'm the asshole that will trigger the event! English Law !

Fri, 03/09/2012 - 03:24 | 2238849 Bernankster
Bernankster's picture

uh oh!

 

Fri, 03/09/2012 - 03:25 | 2238853 barliman
barliman's picture

 

CNBC policy is consistent in Europe

If you want to be a female on camera, your bust must be large and tightly constrained.

Ooooohhh, they've cut back to strict, pretty schoolteacher with ze German accent ......

barliman

Fri, 03/09/2012 - 03:25 | 2238855 Monetative Easing
Monetative Easing's picture

ISDA is in a bit of a bind here.  

If they don't declare a credit event, the CDS market will be in shambles (as it will confirm what the markets have all known since AIG - which is that CDS is a trading and not a hedging vehicle).  Furthermore, peripheral debt should actually sell off as there will be no way to hedge or trade the basis.

On the other hand,  they have avoided a credit event for a reason here - they know that there will be some unforseen consequences that may threaten the whole can kicking exercise.  

The markets will try to trade either outcome as a risk postive event but that is a move that should be faded.  Its getting toward the time where someone will actually have to realize a loss. 

 

Fri, 03/09/2012 - 03:25 | 2238857 blunderdog
blunderdog's picture

No need to be cynical.

Fri, 03/09/2012 - 03:47 | 2238872 lolmao500
lolmao500's picture

The most important question : how much CDS get triggered if this is a credit event??

Or likely, the ISDA will say no credit event, and the stupid markets will ignore this and continue with their business as usual. Hell they've been ignoring the US/Japan problems for the last 20 years... so why not this??

There's no way the big banks will let go of their most lucrative business (CDS).

Fri, 03/09/2012 - 03:46 | 2238875 Yen Cross
Yen Cross's picture

 Greece is Going Fu Manchu .

Fri, 03/09/2012 - 03:50 | 2238880 zilverreiger
zilverreiger's picture

Does anybody still understand all these rescue plans anymore?

Fri, 03/09/2012 - 03:55 | 2238883 Jash
Jash's picture

Does this mean I should keep buying silver?

Fri, 03/09/2012 - 04:19 | 2238895 Dead Canary
Dead Canary's picture

No. It's all worthless. But I'm feeling generous, sooo...... I'll buy it for, lets sayyy  10 cents on the dollar. MmmKay?

Fri, 03/09/2012 - 03:57 | 2238885 Yen Cross
Yen Cross's picture

I'm starting to look for a double top ( usd/jpy) on that retrace to the mid 80's. I was looking at some  Asian Flow charts. I suspect GDP will be FLAT!

     Sector wise. The Japs and Nips will fight it OUT!

Fri, 03/09/2012 - 04:42 | 2238919 jomama
jomama's picture

orly?  'Nip' is slang for Nippon, which means: japanese.

/facepalm

Fri, 03/09/2012 - 05:17 | 2238947 Yen Cross
Yen Cross's picture

  You are how old? Koreans and Japanese dim sum! Get out of that Basement! I'll bet your daddy if you have one, is younger than me! Were you born in 2000? I was partying in Porte Douglas!

Fri, 03/09/2012 - 05:23 | 2238950 jomama
jomama's picture

cool story bro

Fri, 03/09/2012 - 06:19 | 2238983 Non Passaran
Non Passaran's picture

.. which still is no excuse for name calling.
Fail!

Fri, 03/09/2012 - 05:25 | 2238951 chindit13
chindit13's picture

The Japs and Nips will fight it OUT!

Do you mean Japan is going to have a civil war?  THAT isn't priced in.

Fri, 03/09/2012 - 04:04 | 2238890 css1971
css1971's picture

No CDS puts the counter party risk back where it originates. So where does the money go now?

Fri, 03/09/2012 - 05:10 | 2238906 chump666
chump666's picture

actually quite meaningless.  greece is a basket case with a zombie rotting in it.  the trick for this italian nutball (ecb) to bring down Italian and Spanish yields down which he will fail.  hence rangy market and muted rallies sans  employment number.

Fri, 03/09/2012 - 04:31 | 2238908 Ted Baker
Ted Baker's picture

NEXT WORLDWIDE CRISIS IN THE PIPELINE LIKE NEVER SEEN BEFORE:- THE MULTI-TRILLION DOLLAR CDS MARKET

Fri, 03/09/2012 - 04:33 | 2238910 capitallosses
capitallosses's picture

Meh, this is all so yesterday. 25 billion euros? Like get with it. This is the new millenium, we only talk about trillions now. ISDA is on the payroll and will do what they are paid to do!

Fri, 03/09/2012 - 04:42 | 2238918 Yen Cross
Yen Cross's picture

 Just Long covering. Dealers have to fills orders. That China news was shit bag ugly ehh?

Fri, 03/09/2012 - 04:58 | 2238934 xtop23
xtop23's picture

There is no way the ISDA will call it a default tomorrow .... not a chance in Hell. Cans will be kicked regardless of the outcome.

The beatings will continue until morale improves !!!

Fri, 03/09/2012 - 05:00 | 2238936 Yen Cross
Yen Cross's picture

 The whales are JUMPIMG! gasping in their Death throws. The currency markets are like the North Sea Sentinels.

   Gasping for their last " BULL CANDLE"!

Fri, 03/09/2012 - 05:09 | 2238942 Yen Cross
Yen Cross's picture

 This usd/jpy shit is getting old. Time to slam the Panda! Excuse me whilst I make a phone call!

Fri, 03/09/2012 - 05:35 | 2238956 Dull Which
Dull Which's picture

I'm a noob here so please be gentle but are we not in a weird cycle:

The banks have signed up as in so doing they have avoided (perhaps only temporarily) the solvency crisis and contagion that would create (through a widespread credit event/CAC/CDS) but are ignoring the fact that they are in a liquidity crisis as no one will lend a) to a PIIG or b) to the them (thus the overnights with the ECB).

Who's going to buy Greek debt (or any other PIIG debt) next time? That'll be the ECB... who are in a bind at the moment when it comes to printing as the Germans have woken up to the fact that it's not good.

Fri, 03/09/2012 - 05:45 | 2238963 falak pema
falak pema's picture

Now the real show begins. That the Greek pimple on the nose of world capitalism, of which the 'greenback' and the 'Uro-Uzo' are the two pillars, should have taken more than two years to resolve; with a collective LOSS estimated at 30 billion USD in additional interest expenses to the real economy, all injected to the benefit of the virtual Oligarchy economy expressed in fiat ponzi money, shows us where the real problem lies : in the overlevereged banking world itself, officially at 5/1-10/1 leveraging on average on both sides of the pond, but in fact much higher if we include off balance sheeting private sector banking scams, which are unregulated and often parked in off-shore havens. Contagion risk stays a dirty word in World Banksta town even more so every day. Its looks more and more like a losing race.

How will this machine that is making fiat money hand over fist;... aka creating poverty in real economy terms, as the cost of this carry trade of fiat money is far greater than real economic growth; its all circular money and its sucking the real economy dry to feed the ponzi, which is nothing more than a risk asset bubble pump,... will run the first world to deep depression or Armageddon is the ONLY REAL Story in town. Pax Americana and its surrogates now have their work cut out.

Place your bets, its one OR the other; or both at once.  Meanwhile the BRIC economies who create the real wealth in the burgeoning third world chug along to create their own monetary framework. THe day the OIl Oligarchy joins this show the writing will be on the wall for First world. Better hope we have a new energy paradigm in place by then!

Fri, 03/09/2012 - 06:03 | 2238970 ZeroIQ
ZeroIQ's picture

How the fudge will the markets react to the ISDA desicion? I mean no credit event is bad for the bondmarkets and will push risk up for bond investors and make investments in bonds not so attractive. This is bad I think...

On the other hand we have the credit-event, and here we have the whole off-balance sheet dilemmma. No one knows with certain how much CDS have been issued. This could be a event that pushes strained banks/insurers over the brink. This could mean more debt for European countries as they bailout their banks -> further downgrades and more expensive borrowing, although the CDS market will be proven by then, so perhaps borrowing will in fact be cheaper LOL.

 

So, two scenarios, out of which I think there will be some kind of mixed solution that  further complicate things -> more work for Tyler!
I think I will stand this one out, it's a friday too. Going out for a beer.

Fri, 03/09/2012 - 07:47 | 2239059 Catullus
Catullus's picture

It's a netting event with the CDS. If they're activated, we'll see how well the system actually works on sovereigns. I think Peter Tchir wrote recently that any bank who hasn't account for a Greek CDS payout is beyond dumb at this point.

Fri, 03/09/2012 - 06:05 | 2238972 100pcDredge
100pcDredge's picture

My BIG FAT Greek eh... uh... ahm... SOMETHING!

Fri, 03/09/2012 - 06:07 | 2238974 I am Jobe
I am Jobe's picture

Greece is a glimpse into the USSA. Just a nice small way to say this will come to the USSA

15 Reasons Why The U.S. Economic Crisis Is Really An Economic Consolidation By The Elite Banking Powers
http://endoftheamericandream.com/archives/15-reasons-why-the-u-s-economi...

Fri, 03/09/2012 - 06:53 | 2239006 Irish66
Irish66's picture

Something is fishy!

Fri, 03/09/2012 - 07:07 | 2239013 Watts_D_Matter
Watts_D_Matter's picture

Just watched the Weather Channel....said a SHITSTORM is heading towards Greece.....

Fri, 03/09/2012 - 07:15 | 2239021 MeanReversion
MeanReversion's picture

.

Fri, 03/09/2012 - 07:16 | 2239024 DutchDude
DutchDude's picture

Youth unemployment in Greece is 51% and counting... Capable people are leaving the country... Greece is doomed and never gonna be competative for at least 30 years. At least not with an expensive Euro and wages which allow people to bareley feed themselves.

Export is at an alltime low, production also so export is nearly dead, only thing that can help them now is tourism i guess... That's not gonna pay for a huge government apparatus and debt releaving measures...

Greece has no chance what soever...

Fri, 03/09/2012 - 08:09 | 2239081 Implicit simplicit
Implicit simplicit's picture

Act !!, Scene Pretend 111: World- pretend again everything is fine, while the Banks methodically suck the lifeblood from you until you are impoverished.

Cut, Cut. Dam it World, think hopium, hopium, hopium. For a moment, the look on your face reflected reality. Now get back to delusional thinking and Act dam it.

Fri, 03/09/2012 - 08:52 | 2239149 Non Passaran
Non Passaran's picture

Tourism? Maybe, but I wonder who's going to go there now that Germans aren't so welcome.

Fri, 03/09/2012 - 07:16 | 2239026 icanhasbailout
icanhasbailout's picture

The real interesting part comes if they manage to kick the can far enough to have Ireland and/or Portugal also cross the event horizon. Are they crazy enough to believe they can they juggle two or three at once?

Fri, 03/09/2012 - 07:38 | 2239047 Vince Clortho
Vince Clortho's picture

Yes.

Fri, 03/09/2012 - 07:18 | 2239028 Irish66
Irish66's picture

Rerack time

Fri, 03/09/2012 - 07:27 | 2239034 Revert_Back_to_...
Revert_Back_to_1792_Act's picture

"The problem of the re-inauguration of the perpetual circle of production and exchange in foreign trade leads me to a necessary digression on the currency situation of Europe.

Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become "profiteers,", who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.

In the latter stages of the war all the belligerent governments practised, from necessity or incompetence, what a Bolshevist might have done from design. Even now, when the war is over, most of them continue out of weakness the same malpractices."

- John Maynard Keynes - Economic Consequences of the Peace - 1920

http://www.gutenberg.org/files/15776/15776-h/15776-h.htm

 

Fri, 03/09/2012 - 08:02 | 2239048 Major Priapus
Major Priapus's picture

I was most intrigued by Tyler Durden's comments that the Euro contortions we are witnessing today represent transparent machinations permitting the ECB to loot Greece’s gold.

Interesting and most byzantine (byzantine?  ... most à propos – given we are talking Greece)

Ghee whiz – and all this time I naively thought that the EU was only determined to postpone the Greek default until taxpayers had assumed all the banks' liabilities. 

I direct everybody’s attention to a great Der Spiegel article from last June:  where leading German economist Stefan Homburg argued that euro-zone members should not bail out Greece, discussed who is making a profit from the crisis and explained why he himself is buying Greek bonds explaining 

I believe in the boundless stupidity of the German government

http://www.spiegel.de/international/europe/0,1518,770673,00.html

Things that make you go hmmm… anybody heard from Stefi lately or was this a classic case of “pump & dump”?

Fri, 03/09/2012 - 07:41 | 2239051 Vince Clortho
Vince Clortho's picture

No way will the CBs or their stooges admit default.  They will attempt to kick the can, extend and pretend as long as they still breathe oxygen.  The world may go up in flames but there will be no mention of default.

Fri, 03/09/2012 - 07:42 | 2239052 Catullus
Catullus's picture

The state pensions agreed to let the state default on them. Interesting how that works out. That thing in your hand is called a bag, bag holders.

Fri, 03/09/2012 - 07:58 | 2239068 overmedicatedun...
overmedicatedundersexed's picture

GM bond holders (the small ones) took it up the ass. what more do you need to know about gov's and law.

MSM will report a big surprise in BLS data of more jobs created not this bond mumbo jumbo  stocks to new highs.

next few months bonds fall apart as rule of law does not exist anywhere in the west. bullish for PM's stocks maybe as long as CNBC and the rat pack of MSM keep attention on anything but gov debt defaults.

Fri, 03/09/2012 - 08:10 | 2239082 Howdan
Howdan's picture

Nothing to see here people. Move along. No default, no reality, no truth. Just lies, damned lies and fraud. Hey, you - yes, you, MOVE ALONG I said. Nothing to see.

Fri, 03/09/2012 - 08:22 | 2239084 Major Priapus
Major Priapus's picture

Great article in today's Der Spiegel explaining Euro-folly  http://www.spiegel.de/international/europe/0,1518,820302,00.html

Here is a great opening quote:

" ...there are still more than 10 percent who are freeloaders hoping to be fully remunerated. [Stefan Homburg included in that list perhaps?] In part, they are speculators who bought the securities at very low prices on the market, at between 30 and 40 percent (of the nominal price), and are now betting on getting 100 percent back. They must be forced to take part (in the haircut). "

One can only presume that this forced participation is to be deemed "voluntary"!

another great quote:

"Many banks in Greece are already broke, but are still handing out loans. They get the money from the central bank and then lend it to speculators. It's a period of dodgy dealings that will come at the expense of the European taxpayers in the end. Politicians are unbelievably naïve if they allow that to happen."

One can only wonder - "naïve" or "complicit" !?

When this sordid tale has run its course - bankers will be hanging from lamp posts  - next to politicians !

Fri, 03/09/2012 - 08:28 | 2239101 eddiebe
eddiebe's picture

No the banksters will hire your neighbors and hang you from lamp posts,

Fri, 03/09/2012 - 08:25 | 2239097 eddiebe
eddiebe's picture

Hey greeks, that's what happens when you are asleep at the wheel and swap paper and pretty plastic baubles for gold.

Hey rest of the world, take note. The banksters are doing the same thing to you!

Fri, 03/09/2012 - 09:03 | 2239158 Major Priapus
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John Mauldin – (one of my favorite commentators) wrote a great piece a while back:  “Where Is All that Greek Gold?”

Here is a follow-up from one of his Greek fans explaining the peculiar Greek sense of Euro-entitlement. 

"Dear Mr. Mauldin,

 

I am an avid reader and I just wanted to correct you about a comment in one of your articles, "The Pain in Spain", specifically:

 
'Somehow they forgot about the German government paying 115 million deutschmarks in 1960 -- not a small sum back then.'

 

This repayment of 1960 is undeniable. but the total amount owed was $10 billion ($3.5 billion for the return of the gold stolen and the repayment of the war loans Greece was forced into giving Germany, and $7 billion in war reparations awarded to Greece in 1946). As the DM/$ parity was then four for one, this means they gave Greece $29 million out of the $10 billion owed.

 

Germany also proclaims that they have given Greece over the years, in one form or another, €16.5 billion. But the fact of the matter is that despite these alleged payments, the issue of the war loans and gold is still not settled.

 
Greece has never stopped asking for the money to be paid back ... it is estimated that this sum owed now totals $70 billion [I assume the Greeks want interest – JM]. So even taking into account the €16.5 billion, more than $50 billion is still owed.
 

 

Helmut Kohl refused to even discuss the repayment, presenting as an excuse that this amount was owed by the whole of Germany and until Germany is unified the issue could not be discussed.

 

Guess what, Germany is unified....

 

Best Regards,
Anthony Kioussopoulos

 

P.S. Do not take my e-mail as a refusal to acknowledge the fault of successive Greek governments in creating this mess; just take it as a correction for a specific issue."

“correction” indeed!  From the Greek perspective – the rest of Europe in general and Germany in particular still owes them!!! 

This Hellenic collective and total misaprehension of history explains much.  As John Mauldin himself points out - the distinction between perception and reality is moot.  As long as Greeks believe in this ersatz version of history, the Greeks will, in perpetuity, percieve themselves the injured party.  Already, there is talk of Greek re-alignment with Russia (both hailing from eastern orthodox traditions). Russia, for a paltry sum, could dismember NATO's eastern flank. 

So we are NOT just talking money on the table here - we are also talking about a toppled Geo-Political Chessboard - a salient point all-too-often forgotten in this discussion.

Fri, 03/09/2012 - 09:08 | 2239179 flyonmywall
flyonmywall's picture

There is no way that they will call a credit event. These guys know which side their bread is buttered on, and they like butter.

Fri, 03/09/2012 - 12:56 | 2239909 alexanderstollznow
alexanderstollznow's picture

i cant quite find the thread where ZH admits that its incessant harping on the the likelihood of PSI failure, was a/ just a beat up, and b/ wrong.  so i am going to put it here..

CHARLES DALLARA 1

ZERO HEDGE 0

 

now i see the story is that the 15% of greek law bond holders who are affected by CACs are going to sue.  how are they going to sue when the greek government has passed a law to insert the CACs?? get real. we all know that the reason there are holdouts at all, is to make sure the CACs ARE used, so their CDS pays out.  der.

Fri, 03/09/2012 - 17:10 | 2241317 Sudden Debt
Sudden Debt's picture

This is called "THE BUMMER EFFECT"

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