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Hope Springs Eternal
Via Peter Tchir or TF Market Advisors
It seems pretty clear that almost nothing from the big October 27th all-nighter is getting implemented. The bank recap program is still a vague notion, EFSF can't find aggressive buyers of its more straightforward bonds, and the leveraging schemes seems to have died on the vine. The IIF seems to be just beginning the process of negotiating what complex security they will create that pretends to be a 50% "haircut". Direct investments from China and Russia also seem to be off the table.
We are back to the ECB and IMF. Even the reports can barely be bothered to talk about how Spanish or Italian bond yields are improving. We have seen the drill too often...
- ECB calls a couple of desks and asks for some large offers on Spitalian bonds
- ECB doesn't trade but says they will be back in a bit
- dealers try and buy some bonds and leak the rumor that the ECB is in buying
- ECB calls back and again asks for some large offers, but doesn't trade
- dealers buy more bonds, funds buy some bonds
- everyone now figures out the ECB is a buyer and no one wants to sell
- ECB calls back, the dealers offer bonds at an even higher price, and the ECB buys some bonds, but not as much as the dealer hoped for
- the dealer aggressively gets out with the story that ECB is BIG buyer today
- hedge funds notice that the banks aren't really buying anymore and try and sell some
- desks wait for the ECB to call again
- desks get calls from hedge funds look for bids
- desk call ECB, but find out they are done buying for the day
- dealer tries to find some clients who haven't figured out the ECB is done for the day
- and sell their excess inventory to them
- everyone goes back to waiting for a new ECB rumor, because the market is weak and
- everyone is caught long again.
It is getting scary that there is no way to tell if the market is really improving. The ECB has corrupted the price discovery process so much that no rally is believed.
Protests in Greece and Italy continue. I'm not sure that they are bigger or smaller than before the technocrats came into power, but they shouldn't be ignored. The Spanish elections could be interesting as well, in any case, it will be hard to put a technocrat in charge of Spain so soon after an election. I am sure the other leaders in Europe are watching the results closely.
Is the ECB going to lend money to the IMF? Who knows, and who knows if it is lending trillions or if it is just lending the money the IMF has already committed to? Don't forget, the European nations in the IMF and the US are not keen to actually go to the markets so they can borrow money to give to the IMF. I suspect, if the ECB does finance the IMF, at least part of it will be to fund existing commitments that its members don't have the cash for.
The world seems to be splitting into two camps. Those who generally called the deterioration in Europe and saw the flaws in the plans to "fix" it. And those who didn't. Of those analysts who saw the path, saw what was happening in Greece, saw how EFSF actually fanned contagion, how austerity wouldn't work, and wondered why Italy and Spain weren't being pressured to do anything, at least half of them adamantly oppose printing money. These people who seem to have been right, are saying that printing and using the ECB is a bad idea. Of those who got it wrong, let's say Sarkozy, they are all over using the ECB and printing. The guys who have been wrong, wrong again, wrong some more, wrong once again, are the ones who are saying that ECB monetization is the best solution. Why should we believe them? It seems a bit like making the kid in the corner with the dunce hat the teacher.
There is a lot of hope that some sort of announcement will be made today. Failing that, there is hope that a weekend meeting will be scheduled, so we have a reason to be long coming into the weekend. I think we are getting close to seeing some sort of government action - new and bigger swap lines, an emergency rate cut or something, but I'm guessing it comes next week, and doesn't do much for the market. I think we are a long way from getting the ECB to fully turn on the printing press, and continue to hope that some alternative path is found. I really think that in the long run, some defaults will lead to a much better future, than printing will.
I guess we could be pleasantly surprised by the "super-committee" but somehow I doubt that too. Who came up with the name "super-committee" anyways? When we were kids, no one was allowed to create their own nickname.
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Exactly...because that is what central banks do. That is their primary function.
Yes and unfortunately this is rather bullish. They are using the old used car salesman "well it's only 89 bucks a week!" to confuse the average person on price. Also the more I look at it, it just seems like the Germans are playing good cop here. They are pretend to be on the market's side but both good cop and bad cop have the same intentions.
I have no idea what this means...or how it translates bullishly. You are going to be given the PERFECT opportunity to sell this morning. I suggest you take it.
Every day we hear "the Germans are against monetizing further" but then allow this: 20b * 52 = 1.04T.... 1.5 trillion dollars in bond purchases sounds like sovereign QE to me. That is what I am saying, you need to look at actions not words. If words meant anything, the Republican field would contain a lot more good candidates than just Ron Paul.
Actions...words...that's all fine. But the market has rallied on words, and sold off on actions [the absence of]. So just how you apply that is, again, beyond me.
Better to simply look at the truth. Default is the only viable solution. And if the ECB announces money printing, then at that time you pile into PMs. Until then, you simply sell every lift. EVERY LIFT.
As evidence, pull up the futures chart on the Russel this morning. Complete and utter BS futures push this morning...and 12 minutes into the market session...all gone.
Oh I agree with you. And the motions today are helping my doomsday TZA way OTM calls. I just worry that the Germans are not being as fiscally frugal with the ECB leash as they claim.
Actually it is the Mafia that corrupts the price discovery process. They are the representation of not playing by the rules where the rubber meets the road, so to speak.
The CB's are merely playing balancing act catch up for the Mafioso. The Black market is FAR larger than the white.
It's what's happening at the street level that counts. The rest, like their notional CDS values, are mirages.
ORI
My Creative Journey
A lot of bulls were positioned for a breakout and Santa Clause rally (~80% of the trading community).
Now they are in the trap and desperate for any rumor/news to bail them out.
Exactly...because that is the only catalyst left in a market that is no longer a market, at all.
The Kleptocrat game is not chance
It resembles a well-rehearsed dance
With lifts, dips, and spins
Until tyranny wins
And the middle-class shits in their pants.
yeah, was amazing how many people said the price action had given them the all clear signal
I'm not a very passive person. Sitting around while TBTF try to avoid involuntary bankruptcy is getting old.
This isn't in our best interests.
SELL!!!!
fuckinh hopium; i'm sick of it
Nice, I like the heavy slathering of sarcasm in the last 2 paragraphs- Hope? Nope.
Experience, Strength and Hopium.
Looks like Black Friday may be manipulated -- it's all so BULLISH:
" (MarketWatch) — U.S. stock futures pointed to a higher Friday open with analysts saying that European Central Bank purchases of sovereign debt have helped stabilize trading in Italian and Spanish bonds. "
Kool-Aide
So is it wax on or wax off ? I lost track
Grekopium.
[pop!]
easy market to trade! more debt=bullish, less debt= bearish!
Key quote above:
« ... how austerity wouldn't work ... »
Indeed.
And what will really not work is people in nations like Italy and Greece having 'austerity' dictated to them by what they feel are foreign or outside forces.
Merkel's ideas of having foreign supervisors from Germany or the EU going into individual nations and imposing 'austerity' cuts, is laughable. It is amazing how out-of-touch some EU leaders are getting, with the European street.
Dont forget she grew up in East Germany
Stasi youth leader too.
ORI
These assholes who have been wrong, wrong again, wrong some more, wrong once again, are like Linus waiting for the Great Pumpkin to arrive.
So assured that it will come and bring toys to all the girls and boys.
If they just patiently and believingly wait a little while longer in the pumpkin patch, the Great Pumpkin will arive.
"You'll see!", they say.
When in fact, much like Jesus, the Great Pumpkin ain't stopping by, either.
So monetizing the dollar made it weaker but rumors of monetizing Euro debt makes the Euro stronger? Printing dollars in the US raised the debt from $9 trillion to $15 trillion in three years, raised unemployment to 16%, put 47 million people on food stamps, and tripled the cost of just about everything while reducing real wages to the lowest percentage of GDP in history, but printing Euros fixes everything? I fail to see how "Europe getting it" solves a problem. Other than printing dollars doubled the value of the stock market in a year alowing the elite class to profit immensly. AHHHH THERE IT IS!!!!!!
"how austerity wouldn't work"........it really has not taken effect yet....that is what is funny...its losing money today...and expecting future cuts......today is our problem...not 5 years from now....what a joke...except I am not laughing...
Remember it does take 9 months after a all-nighter. When the Merkozy kid is born it will be crowned king or queen of Europe - or maybe in this day and age both at the same time.
The entire whirled is a psychological operation. It's not a case of a network of concurrent operations, the ENTIRE thing is now fully interwove and purely psychological - a whirled of be-dazzled idiots. Containment and deterrence of assertive reaction to its sick horror-esque is also purely psychological.
Any outright rejection of it must be marginalised, quashed and paternally belittled by the superior and sensible ones ... who have our best interests at heart, of course ... so that bitter dissent is normalised into submission.
Only two things maintain this nest of wallet parasites:
1) The intensity and scale of outrageous falseness constantly propagated via the MSM.
2) The willing-stupidity, gullibility, naivety and total lack of dignity or honesty of the average [non]developed-whirled human, who has been repeatedly TOLD and TAUGHT that they're at the Pinnacle of human kultural achievement, even though they have personally achieved nothing whatever, and whose average measure of ANYTHING they do is simultaneously extremely low-grade, next to useless, or actually useless.
Without control of our mind's inertia and it's propensities, they can not control us.
We are NOT being well-served by our clearly-failed, 'modern mind'.
Our minds are THE battlefield, and to me, the modern human mind, and its totally fucked and depraved kulture looks like the psychological version of Flanders after a hundred years of heavy bombardment.
If we are going to caste off these parasitic vermin it will not be via playing along with their global psychological operation.
In the end, we are either going to radically and automatically reject and mock everything these vermin present to us, or we're stuffed.
This is a war of the mind. It's not really about Banks, that's just the window dressing, and props that distract us - that's not the play itself.
And every connivance they use is purely a psychological tool of mass-destruction.
A derivative, or a loan and FRNs are each just psychological operations.
They all rely on us never having the balls to be fully frank with ourselves about this and to turn the tables 100% on them, and endlessly mind-fuck them, right back again, with a counter-barrage.
Such is destructive of everything, and it actually needs to be.
Long live fight-club, because to fight is to bombard them into mental ruins;
To actually defeat them we must demolish their mental foundation, and the sick inertia it's built and maintained within us - ALL.
"I really think that in the long run, some defaults will lead to a much better future, than printing will."
always a pleasure reading Tchir; that being said, all those that we think defaults are good don't matter. Those that matter don't want defaults, so...
They got named the "Super Committee" because the "Doobie Brothers" and the "Village People" were already taken.
Banned
Posted by: testosteronepit
Post date: 11/18/2011 - 19:38
Just in time to make you feel better about holiday travels: airport security scanners that use X-rays are acknowledged to cause cancer. No problem in the US; but now they’re banned in the EU.
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