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Hi, It's Tim, I'm Stuck In Paris, And Need You To Send $500
From Peter Tchir of TF Market Advisors
Hi, It's Tim, I'm Stuck In Paris, And Need You To Send $500
This morning feels like a bad facebook scam. Mr. Geithner continues to remain convinced that nothing bad would have happened had Lehman not gone bankrupt - in spite of a dearth of evidence supporting that view - and has decided that giving more of my money to the IMF will help "solve" things.
Solve had been re-defined to mean temporarily, possibly, delay facing consequences only to face bigger problems at some point in the not too distant future. The IMF, EFSF, EU, G-20 are all busy figuring out how to take more taxpayer money to "solve" the problem. The problem is debt that cannot be paid back. Nothing is being done to ensure that the original lenders can pay back the debt. Not a single word of what is being discussed does anything about that. All this done is shift who will ultimately lose when that debt is not repaid. That is it. Instead of banks bearing the risk for bad credit decisions, they will roll out of their positions and shift it into all the supra-sovereign creations they have devised.
Contagion has spread to Spain and Italy not because Greece and Portugal are having problems, but because Spain and Italy have too much debt and their banks have too many bad loans on their books. 21% unemployment in Spain. Pictures of big buildings completely empty are easy to find. What cannot be found in Spain is real write-downs of the debt that financed that property boom. Spanish banks aren't in trouble only because of their exposure to sovereign debt, they never took the pain for their bad commercial and residential real estate lending. The problem is similar in Italy. We are just pumping money to delay a day of reckoning, but the cycle of each "solution" providing less relief for less time, more institutions and countries lining up at the trough, and fewer (if any) strong institutions there to provide those handouts.
Something will happen because we have brought up the "Lehman Moment" this morning. How so much can be blamed on Lehman is beyond me. It seems like a convenient myth because it leads to the simple conclusion that no big bank can fail. Yet Lehman just wasn't that big to cause all the damage that is attributed to. But since we have a convenient scapegoat, we will implement policies to save Lehman in the belief that fixes everything. It didn't fix things here, it didn't even provide a near term floor, and it is possible that the policies are why the economy has failed to stage a solid rebound and is continually in need of more government funds.
As equities rebound from some slight overnight weakness when briefly the attention was focused on the fact that financial conditions in Spain are deteriorating rather than the imminent solutions, we see credit remain weak. Italian and Spanish yields are increasing both on an outright basis and relative to Germany. I'm not sure that Spain and Italy can afford too many more "risk on" days or else their yields will get back to "dangerous" levels. Though 5.8% on Italian 10 year bonds doesn't seem that "safe". This is back from low yields of 4.9% when the ECB was buying bonds daily. I guess you can trick the market for a few weeks with ploys to re-allocate money, but the reality of a weak economy, no credible plan to fix it, and way too much debt eventually overwhelms the fiction that the politicians and central bankers try to create.
I am sure we are due to get a good IMF rumor, a good EFSF multi trillion rumor, or even plan, so am prepared for one more good run in stocks, though I think a lot of this is built in, and shortly after any new grand plan is announced, the attention will shift to France and its problems. French and Belgium bonds are the worst performing bonds in Europe today. I would expect that trend to continue.
On a side note, JPM has 234 billion of debt outstanding and generated 1.9 billion of profit from spread widening. I don't know how much of the debt is categorized in such a way that JPM has to run the spread widening and spread tightening through income, but I do know JPM credit spreads were relatively stable. JPM CDS went from 77 bps to 162 bps in the quarter. Not even 100 bps of widening in CDS. MS CDS went from 161 bps to 488 in the quarter. Again, I don't know what % of MS debt is subject to that form of accounting, or exactly where it was on June 30th, but with only 1.9 billion shares outstanding, MS could have a monster headline EPS number. From what I can tell, the consensus is 30 cents. The high estimate is 56 cents. If they only take the same 1.9 billion DVA that JPM took, those estimates will be blown away. How the market will respond is another question, but it should be an interesting announcement.
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Good luck with that since it's already priced in. I think you'll get to 1217 on the ES and then it's party over.
OT - Ah, has anyone else seen that they are now evacuating the Azore islands because the canary island volcanoes have started erupting (with some earthquakes?). I think if we wait for the below landslide (which seems to be very probable at this point ) http://www.youtube.com/watch?v=ghDNK8N7PFY, wall street will be under water soon anyways....
Just an FYI.
no need to send timmah the cash to extradite him from paris.
i've heard his head doubles as a hot air balloon. up, up and away. i fully expect to see him in the macy's thanksgiving parade held down by tethers.
MantiXX
FYI They evacuated 50 people from El Hierro in the Canary Islands. There has been a tiny undersea eruption off the island's coast. There would be no flank collapse on this island, you're thinking of La Palma.
So you got absolutely nothing right.
it'll blow past 1220 today as shorts continue to scamble and get fucked to death, once this happens, and 1220 is borken, then the momo's will come in and take it to 1260. The only thing that matters anymore is sovereign debt, but I can guarantee you no one every worries about national deficts until they matter. Right now, the huge sure in Treasuries is seen as bullish for equities because things are "looling up," even though in fact Treasuries are surging because there is no enough capital to plug unfunded deficts when the market goes parabolic.
In other words, you can just go long the markets, and finally short them again once the market wakes up to the debt problem which it has the uncanny knack for igorning because, you know, corporate profits are strooooooooooooong!
yep , agreed. i'm lookin to short somewhere between 1240-1270 .
Cocksuckers.
Taking my (our as in taxpayer) money to fucking bailout/not even fucking fix problems which they created, prolong, extend and make worse by multiple magnitudes had it just been let go.
There must be one mother-fucking hell of a humongoloid scam going on behind the scenes, of money from the wealthy flowing freely in Size to the pockets of these fuckers to let this kind of shit persist.
No fucking wonder that places like the Fed are never audited. They can create money freely, 0's and 1's out of thin air and wire it anywhere in the world to anyfuckingbody with no questions asked.
There fuckers should be tried for treason under the Coinage Act of 1792.
As Marie Antionette once said famously, let them eat shit.
And if you're wondering dear reader.... Yes, I'm pissed.
This shit is unconscionable.
E-fucking-nuff-is-E-fucking-nuff.
This has nothing to do with helping the people these turds govern. All about stealing for themselves the taxpayer money.
+1 knukles...
Not only can the Fed approved banking cartel, Jamie & Lloyd et al, counterfeit money out of thin air...
They make us pay it back with real, hard earned income in the productive economy...
And then pay them interest on it for the privilege of the sodomy...
yup!
let them fail, BiCheZ!
Tines of pitchfork now glistening.
"Nothing is being done to ensure that the original lenders can pay back the debt." Shouldn't that be "borrowers"?
In some language, I forget which, the words for lender and borrower are one and the same, I think it's pronounced print
In Esperanto it's "prunte" (doni/preni) -- but you know what the Bard said ...
Lets be clear, we are bailing out the BOND holders. Not the lender and not the borrower. In fact, I think the bond holders will be paid back and they will also foreclose. 100% return, ka-ching.
Yes, we do know what the Bard said. Bard said 'neither a borrower nor a lender be'. Bard was a wise man.
The world economy is in such a f'mess i think, when it comes to countries, the words borrower and lender are now interchangable. It's all a ponzi shell game wrapped in a confidence trick.
It's not my debt.
And I'm not going to pay it.
If you don't indebt yourself personally in the States your government will do it on your behalf. You'll pay along with the rest of us unless you i) get up & leave or ii) completely withdraw from all society and live in the wilderness. You choose.
Correct, but owning gold and to lesser extent silver is to opt out of the debasement.
The important point is to bide your time and go Galt when it is right for you.
Maybe my individual personal decision to stop paying 70 thousand or so a year in federal and state taxes wont be noticed, but when enough of us have decided that we would rather be idle than work, then we can crash the system.
At some point I shall join the other parasites and become a net burden on society. I want this socialist embarrassment Amerika to end, and see a return to real liberty and personal responsibility.
I wonder how long the host lasts when the real taxpayers decide they are tired of being a chump?
TCT, you have no idea how many people are all planning to "go Galt" just like you. It's going to be epic.
"Instead of banks bearing the risk for bad credit decisions, they will roll out of their positions and shift it into all the supra-sovereign creations they have devised."
Exactly....this is the fact...as soon as the bankers have protected themselves...they will let things fall.....they will make their trillions...and the sheeple will take the hit...sad but true.....the new law is that Bankers and their ilk can never lose....the new world playing field.....at some point they will control all of the gold and silver...then they will let the fiats fail too...
Santander announced this week that is going to write down all it's real estate exposure.
TIIIIMMMMAAAAA!!!
As soon a a plan is announced, the attention is going to shift to the US like a laser beam and the endless QE that the Fed is doing. QE3 is happening right now, the Fed is just lying about it and they likely increased the rate of QE3 yesterday. The Fed is going to announce QE3 early November and try to hide it under the cover of Greece defaulting which send silver to at least $75 by the end of the year.
The plan today is to give more funds to the IMF now.....that is the Feds....they will do it too....soon we will be buying ALL of our own treasuries...and the rest of the world will know the dollar is over as a world currency..if you are a strong country that has a credit balance sheet....they are changing now...to gold and silver I think...and will start asking for something else in the future.....the G20 might meet the EM 10...with the EM standing for emerging markets...I can predict the future..I can not see today
It is all fubar. I just wonder when the banks and goverments are going to tell the retiring baby boomers they cannot pay them.
never. just raise retirement age further, and let them work until they drop dead
I am already part of the generation that will. All equity in the house is gone.
It is somewhat satisifying that a 30 year old will find me dead at my desk.
Not for the 30 year-old.
Then he or she will poke you with a stick.
And due to our ever dumbing-down nation, he or she will think you are napping until at least day 3.
Thats the Singaporean CPF model.
You will never have a problem with "pension" savings when the govt keeps raising the retirement/withdrawal age, and automatically sweeps the fund into a govt administered annuity.
Still wondering why there are so many old folks in Singapore digging in the trash?
"So many"
Another urban myth.
A reference might be useful.
Go sit in a housing estate coffee shop or hawker center, or at 4am go to any MacDs or supermarket, you'll find elderly folk either digging for cans or cardboard.
I've seen it firsthand for long enough to know its no urban legend.
The urban myth is that all is well in Asia's paradise.
Sorry, qussl3, I disagree with you but you speak the lingo (coffee shop, hawker center) so I know you have some knowledge of Asia.
Those elderly are few and far between and I would venture that some do it just because they want to make it on their own and they refuse to take handouts. Some probably don't have all of their marbles.
There is a strong family unit in all of Asia; no need for massive medical insurance. This is just one area where Asia is killing the US.
Some people will always fall through the cracks. That's just humanity.
Asia IS paradise in my opinion.
I agree. Take your pick:
Debasement of the currency
Means testing for services
Raising the retirement age
Restricting health care for the elderly
This is why many upper middle class are engaging in medicaid financial planning, and moving assets in a way to appear poor enough to qualify for means tested medicare and social security.
After all, if we reward poor people and idleness then we will have more.
Build it and they will come.
It is fucking stupid to reward poverty and parasitism.
Oh, they'll pay the boomers, it'll just not be adjusted for inflation. Meaning, the sociable insecurity check for 600 bucks may get you the small bag of cat food, or maybe just one can.
Retail sales beat "estimates"...HFT's loaded for headline ramp...cue Bob Pisani with uncontrolled erection.
MS blowing out estimates on BS accounting would be the topping on the cake.
Epic.
So then Iran nuclear war kickoff Saturday or Sunday? Anyone gambling holding long over the weekend with the radioactive war sabres rattling?
I don't gamble which is why I hold sound investments such as LULU...I hear they might even be in the process of making an Ahmadinejad line.
Your tights are full of Shiite.
Maaaaaaaaaaaaa!!! Where's that meatloaf?!!
http://www.bloomberg.com/news/2011-10-14/g-20-said-to-weigh-boosting-imf-lending-power-to-aid-europe.html
Time for the PTBs to quintuple down....
Well, the deficit has been growing for years and the debt has been unrepayable since the 90's. With that said, how is it that any "taxpayer" money has been spent? No money collected from any of us has been spent on any of these recent adventures of Geithner and company since by definition that would require a surplus of taxpayer revenue to do so. So hasn't this problem of a currency crisis been more or less baked in the cake for some time now as evidenced by our ever increasing budget deficits and accrued debt, regardless of these vast expenditures more recently?
This is simply counterfeiting on a grand scale which will lead to the demise of the currency. At best we could argue these recent examples of monetization have sped up the process of the breakdown, but I think it was always in the cards regardless. Look at the out year obligations for SS and Medicare, this crisis has been mapped out for quite some time. That is why I no longer get pissed off at these fools with their big plans. They are idiots of the highest order for believing that a debt based monetary system was sustainable. It will come crashing down in the near future and of course they will all claim that no one could have seen it coming.
Debt based systems of fiat are sustainable if there is no monopolist manipulating interest rates for political motives and if there are never any bailouts.
You make bad loans and become insolvent then you cease to exist.
About once every 60 to 70 years are so a systemic cleansing and lots of pain are necessary to keep the system honest.
Timmys bailout + money printing song...
It started when I played with it
It turned into a habit
And after that once you've been bit
You can't seem to get rid of it
It's on my mind most of the time
That's when you find we all go blind
Then it will start to get in our hearts
It's gone too far, that's who we are
It's a monster
We all have within us
It's a monster
and fingers are snapping in coffee houses all over the world.
"all busy figuring out how to take more taxpayer money."
Period.
I've got two words for Tim 'shit for brains' Geithner:
Fannie
Freddie
I have two more:
ass
hole
tax
cheat
This is bad because?
I thought ZHers were all about tax avoidance. Timmmay, is your hero!
I think it has reached the point where true patriots are beginning to conclude that the beast will never voluntarily go on a diet, so he must be caged and starved.
You say tax avoidance, Timmmay says tax evasion.
You're
Fired
the plan has always been to transfer the problems to the tax payer "for our own good".
The problem will have to be transferred to either the Bernank or God because they are the only ones that can create wealth from nothing. The taxpayer is tapped out.
Alien invaders who will fund both sides of the colonial war and then get bored and leave. - Paul Krugman, Nobel Laureate, leader of the keynesian school, Ronald Regan expert.
It is comical to watch politicians spin and even become evasive when asked the question directly.
"Who are you going to make pay for the bad debt, the creditor, the debtor, or someone else?"
d) All of the above
Great headline!
Mr. Jeethner... "has decided that giving more of my money to the IMF will help "solve" things."
Crony Capitalism: Elite Always Failing Upwards
Timmah's thinking IMF employment after he's fired from Treasury...
Or the idiot Obummer is fired and Timmah is out with him...
So why not swing some business the IMF's way... Might help Jeethner's employment prospects...
Tim?! You never call, you never write, and now you need me to bail you out again?
Yeah, Timmy! The economy dips the way it wants lOlz http://www.youtube.com/watch?v=1J3w4cS2MvM