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Humpty Van Rompuy Has Fallen Off The Wall

Tyler Durden's picture





 

From Mark Grant, author of Out of the Box

Europe, A Victim Of Its Own Folly

“Do you wrestle with dreams? Do you contend with shadows? Do you move in a kind of sleep? Time has slipped away. Your life is stolen. You tarried with trifles, Victim of your folly.”

 

                       -Frank Herbert, Dune

You may have noticed, I have certainly noticed, that Europe is living in a kind of dream world where they propose various schemes and hope that you see them as some kind of solution for their problems and so; go back to sleep. This worked initially and they keep hoping it will work again but the Sleeper has awakened and is paying attention which is why the “Headline Rallies” have become so short in duration. Many of the schemes now are coming from the troubled countries or the ones that may be troubled shortly, to quote the famous song in Casablanca, “As Time Goes By.” I think it has gotten to the point that they believe their own rhetoric. They spewed it for the masses and they spewed it for the world’s investors and it has been repeated so often that they now rely upon their own fantasy as truth. The Europeans have become the victim of their own folly.

If you stand back and place all of the current schemes upon a small knoll and observe them carefully you will notice one thing; each is tied with a red ribbon trying to get Germany, the Netherlands, Austria and Finland et al to pick up the tab for everyone else. The Spanish pleas for ECB intervention, some Grand Duke to supervise, control and pay for the banks, Eurobonds, bailout funds; they all have the same purpose which is a plea for money from those that have it to be transferred to those that do not have it waved under the banner of a United Europe where each nation is responsible for every other nation and where each country eventually settles to the same cost of funding and standard of living as all of the countries; at the mean. This is the theme that wafts in the wind and it is just various color bearers that wave the flag.  The Germans and the rest of the monied countries have taken two tacts in response to all of this. First they say that “maybe, somewhere out in the future, when the time is right” and so forth to placate those asking for the averaging of Europe which will accrue to their benefit and then, when pressed, they just say, “No” which ends the conversation as nothing can be done without the acquiescence of those still holding their own bags of gold. The politics is not complicated. Germany, for their part, wants to keep the other European nations placated so they will keep buying their goods and services but this part of the equation is also getting problematical. The poorer nations beg, the richer ones hand out some charity but refuse to pour out their purses upon the ground and very little gets done or will get done because the two camps are at cross purposes that cannot, and will not in my opinion, ever get resolved.

If cousin Jake got in financial trouble and his business verged on bankruptcy and he was forced to move to a walk-up tenement in Brooklyn and he pleaded for help I am sure that you would respond. You would “do what you could” you would say which would be to provide him some money. You might even wander over to his business and look at his books and set down guidelines for the receipt of your money so that it would not be squandered. You would not, however, endanger your own way of life and give him so much money that you were forced to move from your very pleasant house in Westchester and give up your Bentley to help your cousin who had brought this all upon himself. This would not be happening and it will not be happening in Europe and all of the schemes and plans and artifices devised by those in need will not get Germany and the rest to live in the same fashion as those in Athens, Dublin, Lisbon and Madrid. When you see the next, new, new fanciful plan floating around in the wind don’t be alarmed and don’t be taken in by the pretty colors. Unless Germany agrees to something it will not be happening and Germany will not, cannot without severe political consequences, agree to the demands of their needy neighbors.

Heading South

All of Europe is gripped by a recession except for Germany. Germany will soon be included as the demand for their goods and services dries up due to the financial conditions on the Continent. There is no decoupling in the world and there has not been in decades as the economy for all of the world is now global. So the United States will also head into a recession which will be caused by the troubles in Greece, Portugal, Ireland and Spain just as the recession in 2008/2009 was caused by the idiocy of free money and no documentation mortgages that took place in America. Europe will soon be returning the favor. That is my opinion. It will not be Armageddon or some 1930’s type of travesty but it will be unpleasant and serious especially as Europe wants to concentrate on liquidity and firewalls and all manner of schemes that do not address the real problems of the countries that are deeply troubled. The solutions proposed do not confront the core issues and, until they do, the situation will only worsen with Spain and Italy joining Casey at the bat.

It’s What You Count That Matters

Allow me to comment on one final issue this morning. When calculating the debt to GDP ratios of the countries in Europe I include their derivatives, regional guaranteed debt, bank guaranteed debt, corporate guaranteed debt and other obligations assumed by the nation. It is not Mark Grant’s opinion or viewpoint rather it is just that I count everything while Europe does not. However the difference is only academic when things go rolling merrily along. When economies head into a recession the differentiation matters.

Europe also allows for sovereign debt to be counted as risk-free assets and not marked-to-market. Many nations, Spain is one example, allow for Real Estate loans, mortgages and even commercial loans to be carried at face value as a matter of financial engineering. I think it is a bad joke but the bite has come. This occurs when the loans no longer pay and the revenues are no longer present no matter how you carry them on your books. Then, if the banks try to off-load the properties they have assumed they take losses which are real losses and have to be accounted for on the books or they are securitized and placed as collateral at the ECB which then hides the problem for a while but not indefinitely and the “indefinite” has run out of time which is why any number of banks are calling “Uncle” and why the sovereign nation nations are crying “Uncle” and trying to deflect their problems first back to the ECB and then to find some new scheme so that the country does not fall victim to the Men in Black. All fine, all dandy, but, once again, the central issues are not dealt with and all of the schemes like all of the King’s men and horses cannot put Humpty back together again.

Humpty has fallen off the wall.

 


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Tue, 06/19/2012 - 08:21 | Link to Comment GenXer
GenXer's picture

Farage said it best about this gimp

Tue, 06/19/2012 - 08:25 | Link to Comment Harlequin001
Harlequin001's picture

Bernard Madoff shouldn't be in prison, he should be in charge of the ECB...

At least he knew when he'd run out of money...

Tue, 06/19/2012 - 08:32 | Link to Comment Rubicon
Rubicon's picture

Leave Golum alone. He is in conflict with himself.

Tue, 06/19/2012 - 08:42 | Link to Comment Aziz
Aziz's picture

Fifth rate bank clerk.

Tue, 06/19/2012 - 09:07 | Link to Comment Temporalist
Temporalist's picture

All the king's horses and all the king's men asked "Who the fuck is Van Rompuy?"

Tue, 06/19/2012 - 09:17 | Link to Comment Badabing
Badabing's picture

Did we forget? I remember that it was a “bank” that fudged the books for Greece to join the European Union.  And it’s a bank that wants Greece to pay the debt that was created out of thin air. And it’s a fucking bank that has bought up all the politicians and keep them in their pockets like so many nickels and dimes. And it’s a bank that’s responsible for inflation and stealing the working mans savings. And it’s a fucking bank that caused my mom to stop raising me and my siblings and go out and get a job to make ends meet. And its fucking bank that changed the constitution and is breaking the law as I type.

FUCKING BANK!!  Don’t forget!   

Tue, 06/19/2012 - 10:26 | Link to Comment kridkrid
kridkrid's picture

Right click, copy, right click, paste.  You should add that post in most threads.  For realz.

Tue, 06/19/2012 - 12:56 | Link to Comment Badabing
Badabing's picture

Thanks                 Fucking banks!

Tue, 06/19/2012 - 13:01 | Link to Comment LeonardoFibonacci
LeonardoFibonacci's picture

Born from a reptile mother

Tue, 06/19/2012 - 08:32 | Link to Comment Colombian Gringo
Colombian Gringo's picture

Best news I read this morning. If only the rest of the EU bureaucrats could also crack their heads, then there would be hope for Europe.

Tue, 06/19/2012 - 08:31 | Link to Comment LeonardoFibonacci
LeonardoFibonacci's picture

Nigel Farage has already called him UGLY.  The best thing is he is an ugly guy!

Tue, 06/19/2012 - 08:40 | Link to Comment Gully Foyle
Gully Foyle's picture

TrainWreck1

"*in an Al Gore sort of way..."

http://abclocal.go.com/kabc/story?section=news/politics&id=7521944

In an interview with police she describes Gore as "a crazed sex poodle."

Tue, 06/19/2012 - 08:45 | Link to Comment falak pema
falak pema's picture

she hasn't met DSK. 

Tue, 06/19/2012 - 08:46 | Link to Comment TrainWreck1
Tue, 06/19/2012 - 08:33 | Link to Comment Gully Foyle
Gully Foyle's picture

Everytime I see this guy all I can picture is Sandler's Happy Gilmore mocking his name for like five minutes.

That is after the Benny Hill big assed sex romp skit.

Tue, 06/19/2012 - 08:35 | Link to Comment aus_punter
aus_punter's picture

Just to get it off my chest: I absolutely fucking detest Von Rumpuy.  This elitist cunt, born into privelege, who hides behind a Socialist disguise so that he can subordinate the populous, represents everything that is wrong with the freakshow that is the European Commission.

This misfit would have been hanging from a hook by his underpants at school and yet now his arrogance and ineptness affects the lives of millions

An unelected, parasitic scumbag of the highest order.  No leadership qualities, no charisma, no values.  I feel sorry for you poor subjucated European fools.

Tue, 06/19/2012 - 08:49 | Link to Comment BigJim
BigJim's picture

I doubt the 'leaders' in whatever corner you're hailing from are much different.

Tue, 06/19/2012 - 09:11 | Link to Comment Al Gorerhythm
Al Gorerhythm's picture

Goddamn sensationalist headline. I clicked to look thinking that the slimy little lizard like bastard had prematurely kicked it. I hate disappointments.

Tue, 06/19/2012 - 08:22 | Link to Comment disabledvet
disabledvet's picture

They are a "victim of hope over experience" I would agree with that. Nothing is more human of course.

Tue, 06/19/2012 - 08:23 | Link to Comment GMadScientist
GMadScientist's picture

"I regret to inform you that I may not have remembered to pack the parachutes. Sorry, my bad."

Tue, 06/19/2012 - 08:47 | Link to Comment old naughty
old naughty's picture

Germany doesn't want to put all of their humpties in the ECB basket...Sorry, "meine bose".

Tue, 06/19/2012 - 08:24 | Link to Comment q99x2
q99x2's picture

an Rompuy Has Fallen Off The Wall

I found one of these in my cousin's room yesterday. It was green and crawling on her jacket. I caught it with my hand and threw it out the back door of the house. I don't know if it came in through the TV or what but I'm going out to buy some spray today.

Tue, 06/19/2012 - 08:25 | Link to Comment Mamzer Ben Zonah
Mamzer Ben Zonah's picture
Greek octopus forms coalition with dolphin's genitals

http://www.newscientist.com/blogs/shortsharpscience/2012/06/greek-octopus-forms-coalition.html

Maybe William Banzai can make something out of this image ....

Tue, 06/19/2012 - 08:30 | Link to Comment Jack Sheet
Jack Sheet's picture

It's all so simple - 103 trillion $ of new credit

http://www.weforum.org/news/over-us-100-trillion-additional-credit-neede...

Could be used for some creative infrastructure projects, like connecting all the Greek islands with tunnels

Tue, 06/19/2012 - 08:58 | Link to Comment francis_sawyer
francis_sawyer's picture

Try to stay away from the Minotaurs...

Tue, 06/19/2012 - 09:21 | Link to Comment flacon
flacon's picture

At first I thought that article was a joke, but then I notied it is from the "World Economic Forum" and then I knew it was a joke. 

 

But yeah... holy shit! $103T in C.R.E.D.I.T.!

Tue, 06/19/2012 - 08:28 | Link to Comment Bro of the Sorr...
Bro of the Sorrowful Figure's picture

shitty analogy. you got the pleasant house in westchester and the bentley from money earned from jake buying your stuff for 10 years after you gave him a member's only credit card he could use at your store. 

Tue, 06/19/2012 - 08:30 | Link to Comment TrainWreck1
TrainWreck1's picture

Even if Herman loses everything, he's still got his looks.

http://i.telegraph.co.uk/multimedia/archive/01578/van-rompuy_1578002c.jpg

Tue, 06/19/2012 - 08:38 | Link to Comment Gully Foyle
Gully Foyle's picture

TrainWreck1

Dude, you are on the money.

That is if he moves to Japan.

http://www.weirdasianews.com/2008/10/26/74-yearold-japanese-porn-star/

74 Year-Old Japanese Porn Star Still Going

I think all men have a glimmer of hope that when we are in our 70?s and starting to need a little assistance around the house, that we might get a nice hot nurse to come and take care of us.

Some fantasy’s might even include a little happy time when being helped into bed or getting your sponge bath, but these are just fantasy’s and cant possibly come true… right?

Well for 74 year-old Shigeo Tokuda, this is a reality that happens more often than you would think.

Thats because Shigeo is actually a 74 year-old porn star who sometimes performs in roles where he is an elderly man in a home, when a hot nurse who is there to help him out gives him a little more help than normal.

http://www.weirdasianews.com/wp-content/uploads/2008/10/elderly-porn.jpg

“Lately I’m also starring as the main actor in a porn series set in a senior-care home. The girl that I’m costarring with might play my son’s wife, a daughter of a relative that I happen to be looking after, or a helper at one of the care homes.”

It all started over 20 years ago, when Shigeo wanted to buy a porn video and was embarassed to purchase it at an adult store. He went to the production company itself and over time became friends with the director.

Shigeo has since performed in over 250 adult films during his over 14 years in the porn film industry.

Although you would think it is the sex that keeps Shigeo coming back for film after film, it is actually the role playing and acting that turns him on the most.

“I mentioned before that I like films that are set up like TV dramas. This is partly because I’ve always had the desire to turn into all sorts of different people. So personally, I don’t get off just having sex with somebody. I continue working in this industry not because I like starring in adult films, but because I am given the opportunity to act in various roles. The appeal for me is in the fact that I can play different people, not that I can boast about my acting skills. Consequently, most of the films that I’m in have a proper plot and narrative.”

Shigeo has plans to continue moaking more adult films until he feels his health and age become an issue.

“Right now I don’t have any illnesses, so I guess I’ll keep watching my health and at least try to go on until I’m 80 [laughs].”

(The guy is 74. He has 14 years in the industry. Started at 60 and made over 250 films. DAMN, I have a new role model to aspire to.}

Tue, 06/19/2012 - 08:43 | Link to Comment TrainWreck1
TrainWreck1's picture

It's his black socks that make women puddle.

http://www.euroskop.cz/gallery/57/17241-van_rompuy_plaz.jpg

 

 

Tue, 06/19/2012 - 08:31 | Link to Comment youngman
youngman's picture

The accountants just announced that their report would be delayed until September......wow.....gues its bad....real bad...

Tue, 06/19/2012 - 08:33 | Link to Comment AU5K
AU5K's picture

Outlaw short selling, mark to market and bond vigilantes.  There, everything is fixed.

Tue, 06/19/2012 - 08:37 | Link to Comment GMadScientist
GMadScientist's picture

Hey, why is everyone selling?

Tue, 06/19/2012 - 08:40 | Link to Comment LMAOLORI
LMAOLORI's picture


Why it's time to outlaw credit default swaps

http://finance.fortune.cnn.com/2012/06/18/credit-default-swaps/

Tue, 06/19/2012 - 08:38 | Link to Comment LMAOLORI
LMAOLORI's picture

 

Barroso blames eurozone crisis on US banks

 

http://www.guardian.co.uk/world/2012/jun/18/g20-summit-barroso-eurozone-crisis

 

He has a point here!

Tue, 06/19/2012 - 09:12 | Link to Comment zilverreiger
zilverreiger's picture

First time he's making sense indeed ( but it's all intertwined, and it still doesn't give him the right to milk out his subordinate neuro nations in turn.)

Tue, 06/19/2012 - 08:40 | Link to Comment Jim in MN
Jim in MN's picture

Hey, Larry Summers has a piece in the Post today about not ending the world n stuff.  Let's pile on Larry!

 

http://www.washingtonpost.com/opinions/lawrence-summers-avoiding-a-globa...

 

Tue, 06/19/2012 - 08:41 | Link to Comment falak pema
falak pema's picture

ha ha ha the only real Humpty in the world is the US Dolla! But that is another story. Go see Irma la douce and you'll get it. 

Tue, 06/19/2012 - 08:43 | Link to Comment MFL8240
MFL8240's picture

I thought for a second they were talking about this country!

Tue, 06/19/2012 - 08:52 | Link to Comment apberusdisvet
apberusdisvet's picture

 

 

Von Rumpled

Tue, 06/19/2012 - 08:52 | Link to Comment chubbar
chubbar's picture

I semi lost interest in his comments when I read this sentence.

"So the United States will also head into a recession which will be caused by the troubles in Greece, Portugal, Ireland and Spain just as the recession in 2008/2009 was caused by the idiocy of free money and no documentation mortgages that took place in America."

For someone who fancies himself an analyst who can see through the bullshit fanancial shenanigans being played in Euroland by the bankers, he has a blindspot a mile wide here in the U.S.

Every BLS statistic is straight out of fantasy land, especially GDP, yet he buys it hook, line and sinker. The U.S. is in a depression. I'd welcome a recession right about now.

Tue, 06/19/2012 - 08:53 | Link to Comment francis_sawyer
francis_sawyer's picture

 "sovereign debt to be counted as risk-free assets and not marked-to-market"

~~~

Naturally ~ How can there possibly be any risk to investing whatsoever? What could possibly go wrong?

Tue, 06/19/2012 - 08:56 | Link to Comment franzpick
franzpick's picture

find some new scheme so that the country does not fall victim to the Men in Black

With that kind of accounting world citizens have already fallen victim to sovereign and financial leaders and van rumpy's ilk - the men in red.

Tue, 06/19/2012 - 09:00 | Link to Comment azzhatter
azzhatter's picture

Besides being a despicable thug, this guy looks like a cunt. A pasty faced little prick who needs a beat down badly.

Tue, 06/19/2012 - 09:05 | Link to Comment TahoeBilly2012
TahoeBilly2012's picture

Grant- How do you KNOW it will not be some 1930's style calamity?

Tue, 06/19/2012 - 09:09 | Link to Comment MFL8240
MFL8240's picture

"Many nations, Spain is one example, allow for Real Estate loans, mortgages and even commercial loans to be carried at face value as a matter of financial engineering."

 

 

INCLUDING THE US GANGSTERS AT BOFA, CITI, WELLS, CHASE AND GS.  SAME THING HERE, WE HAVE THESE NONPERFORMING ASSETS IN OFF BALANCE SHEET ACCOUNTS.

 

SO WHAT ABOUT THIS STORY IS NEW?

Tue, 06/19/2012 - 09:52 | Link to Comment Winters75
Winters75's picture

Barroso and Van Rompuy.. the undead

http://i49.tinypic.com/28bbknp.jpg

Tue, 06/19/2012 - 10:22 | Link to Comment Unholy Dalliance
Unholy Dalliance's picture

"The Germans and the rest of the monied countries have taken two tacts…"

 

Look, why should I take anything this guy says if he keeps on making English 'faux pas'? The last word in the quote above should be tack: as in the nautical expression to change direction. Tact is the English word meaning discretion or, perhaps, diplomacy, polite caution etc., etc.

U D 

Tue, 06/19/2012 - 10:52 | Link to Comment The Count
The Count's picture

He does not resemble Humpty at all, rather he appears to be some kind of Rompuystizchen.

Tue, 06/19/2012 - 10:53 | Link to Comment Element
Element's picture

It's the third recession that's going to be the cruel one ... after that we're going to become hard bastards, and mighty pissed off.

Tue, 06/19/2012 - 11:14 | Link to Comment shutupnsing
Tue, 06/19/2012 - 20:58 | Link to Comment neutrinoman
neutrinoman's picture

The Basel rules are partly responsible for this fiasco. Instead of old-fashioned credit analysis, the rules magically declared certain classes of debt "risk-free" (sovereign bonds -- how convenient), mortgage and other debt "low risk," and so on. Because of the lower risk weightings assigned to these classes of debt, banks could lower their overall risk scores by just gorging on the favored classes of debt.

So naturally the banks loaded up on mortgages (here) and sovereign debt (there).

Unfortunately, these really bad standards are being phased in here too.

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