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I'll Hold Yours If You Hold Mine: The Italian Ponzi Comes Home

Submitted by Tyler Durden on 01/05/2012 11:06 -0400

Via Peter Tchir of TF Market Advisors,

So, according to this, Mediobanca is the largest shareholder of UniCredit. I guess it could be custodial, but does explain why they are part of the underwriting group that backstopped the deal.

If you combine the Central Bank of Libya, Libyan Investment Authority, and Libyan Foreign Bank holdings, then they are actually bigger than Mediobanca.

At the risk of making a mountain out of a mole hill, Unicredit is the largest holder of Mediobanca (8.7% according to Bloomberg)

Remember when CDO's all bought each other's BBB and BB tranches, because no one else would?

- advertisements -

Thu, 01/05/2012 - 11:09 | 2035381 hugovanderbubble

Peter and Generali Assecurazioni

Tyler and ZH knows perfectly that GENERALI is in BK

*OAS-BUND SPREAD 153

Thu, 01/05/2012 - 11:11 | 2035393 Hugh_Jorgan

Gentlemen, start your death spiral...

Thu, 01/05/2012 - 11:14 | 2035401 hedgeless_horseman

Please remind me again. Who is the largest holder of US TreAAsuries? Oh, that is right, The Federal Reserve.

Thu, 01/05/2012 - 11:16 | 2035408 Pladizow

Circle Jerk Bitches!

Thu, 01/05/2012 - 11:17 | 2035411 LawsofPhysics

Perhaps, but it seems like the circle is getting notably smaller. Either that or the game is going "underground".

Thu, 01/05/2012 - 11:23 | 2035436 Pladizow

This seems familiar, Oh Yeah - BofA owns 34% of Black Rock and Black Rock is the largest owner of B of A shares.

Yet Black Rock, the NY Fed and Pimco all filed suites against BofA.

Perhaps the heads of the family have once again given an order to wack a made man!

Thu, 01/05/2012 - 11:27 | 2035446 LawsofPhysics

Many will be getting "whacked", but don't hold your breath on it being anyone in the elitist's club. By extension of your analogy, does this mean that JPM is "the godfather"?

Thu, 01/05/2012 - 11:50 | 2035516 redpill

Italy: http://www.youtube.com/watch?v=68LOWc-plpw

Thu, 01/05/2012 - 12:07 | 2035596 economics1996

That was gross after breakfast, getting ready for lecture.

Thu, 01/05/2012 - 11:25 | 2035443 pods

Pretty soon old Ben is going to have to play "The Stranger."

http://www.urbandictionary.com/define.php?term=the%20stranger

pods

Thu, 01/05/2012 - 11:41 | 2035487 Agent P

I never thought about trying that. Sorry it took me so long to comment on your post...I'm typing with one hand at the moment.

Thu, 01/05/2012 - 12:10 | 2035609 economics1996

Eh gads, I never knew that.

Thu, 01/05/2012 - 11:50 | 2035518 centerline

Yup. With escalating counterparty exposure. When the tipping point happens, everyone goes down.

Just more proof of what Tyler has been pointing out for quite some time now.

Thu, 01/05/2012 - 11:23 | 2035429 EscapeKey

That's totally different for reasons which should seem obvious to you by now, and anyway, that the Keynesians don't really have time to go into details about now.

Anyway, snark aside, Chinese treasury holdings have been stagnant over the past year, which, due to the spiralling total US debts, now account for only 7.6% of the total pie, rather than the 8.7% last year.

Their incredible shrinking (but static) stake.

Thu, 01/05/2012 - 11:33 | 2035451 LawsofPhysics

Yes, it would seem that "dilution" can solve many problems in addition to pollution.

Thu, 01/05/2012 - 20:12 | 2037530 StychoKiller

Hmm, all those depreciating T-Bills...if only there were some "hard" currency to exchange them for...

Thu, 01/05/2012 - 12:02 | 2035572 smlbizman

alright stand, hand over heart and listen..the big "o" is talking...you will listen and agree..

Thu, 01/05/2012 - 11:09 | 2035387 a growing concern

Mobius strip death spiral!

Thu, 01/05/2012 - 11:10 | 2035389 fonzanoon

Peter I thought you said the other day that LTRO would be enough to help the European Banks?

Thu, 01/05/2012 - 20:41 | 2037605 oogs66

He was wrong! Or flip flopped. Or just tries hard to dig deep

Thu, 01/05/2012 - 11:10 | 2035392 Ghordius

"At the risk of making a mountain out of a mole hill"

right

Thu, 01/05/2012 - 11:12 | 2035394 Hansel

I'm my own grandpa.

Thu, 01/05/2012 - 11:11 | 2035395 Cognitive Dissonance

Sounds more like a musical chairs circle jerk to me.

Whoops! Who turned off the music?

Thu, 01/05/2012 - 11:14 | 2035404 GeneMarchbanks

Ah, CD do I just have to follow you around and make corrections indefinitely?

2008 the music stopped, 2012 we all went soft.

Thu, 01/05/2012 - 11:34 | 2035462 Cognitive Dissonance

I did not say when the music stopped, only that it had. :>)

Thu, 01/05/2012 - 20:13 | 2037531 StychoKiller

"It's got a good beat and you can dance to it." (the "Jerk", that is!) :>D

Thu, 01/05/2012 - 11:11 | 2035398 GeneMarchbanks

Ponzi-rific.

Thu, 01/05/2012 - 12:12 | 2035626 economics1996

Bernanke needs to fucking print, wait, didn't he do that? Credit swaps or some shit?

Thu, 01/05/2012 - 11:12 | 2035399 lolmao500

What a ponzi.

What's sad about all this economic crap is that it diverts attention from real problems... like the CHERNOBYL reactor needing a new DOME to you know, avoid big problems....

http://www.aljazeera.com/news/europe/2011/04/2011419203114563968.html

Ukraine raises $788m for Chernobyl dome

An international conference has raised $788m to help build a containment shell at the site of the Chernobyl nuclear disaster, falling short of Ukraine's $1bn fundraising target.

The ruins of Chernobyl's Number Four reactor, which blew up in April 1986 after a safety experiment went wrong, are housed in a cement structure.

The structure is slowly crumbling and there are fears that radiation from more than 200 tonnes of nuclear material may escape into the atmosphere.

"Much of the money comes from the European Union and the European Bank of Reconstruction and Development," he said.

A prevailing southeast wind carried a cloud of radioactivity over Belarus and Russia and into parts of northern Europe.

But eh, keep ignoring this and keep printing money for the bankers... what about the ECB prints a few billions for this?

Thu, 01/05/2012 - 11:16 | 2035407 a growing concern

Do dollar bills insulate from radiation? If so, Tiny Tim can load up some C130s and air drop pallets of Benjamins to plug the holes in the radiation dome.

Thu, 01/05/2012 - 11:59 | 2035551 HardlyZero

Hey!

We can turn the whole fallout region into a Business Opportunity Center, provide zero business taxes. We can setup all the banking headquarters there and run free popcorn from the dome (free heat source). This could really help develop the region into a "banking powerhouse" .

Over time...the banking problem will "go away".

Has anyone else thought of that ?

Thu, 01/05/2012 - 12:15 | 2035639 economics1996

No, most of us were thinking of the old school way of hanging them about 10 feet off the ground way.

Thu, 01/05/2012 - 11:18 | 2035414 EconSammie

Last night I watched the Jeff Randall Live show on Sky News and the economist Shaun Richards said that he thought that Unicredit was on its way into deeper trouble. Here is his update on the subject.

Firstly let me welcome any new readers who are reading this blog after seeing me be interviewed on Jeff Randall Live on Sky News yesterday evening. For those who did not see the interview I gave my opinion on the Italian bank Unicredit’s prospects and gave two major problems for it. These are its holdings of Italian government bonds ( and indeed other sovereign bonds) where prices have fallen heavily (over the last year or so the benchmark Italian ten-year bond yield has risen from 4% to 6.93%). And also that lending in foreign currencies to individuals and businesses in other nations, particularly in Hungary, was going wrong. I highlighted the way that the Hungarian Forint had hit a new low against the Euro and that in spite of moves by the Swiss National Bank it was heading lower against the Swiss Franc too. This means that those who borrowed in Swiss Francs and Euros but repay in Hungarian Forints have a problem which means that the lender also has a problem.

I note that today two of these matters have progressed further. Firstly the Hungarian Forint has fallen to a further low against the Euro of 321.68 this morning and secondly the Unicredit share price has fallen by 7% today to 5 Euros after falling by 14% yesterday

http://www.mindfulmoney.co.uk/wp/shaun-richards/my-thoughts-on-unicredit-and-the-banking-corpses-kept-on-life-support-in-ae-or-emergency-rooms/

Thu, 01/05/2012 - 11:19 | 2035418 Jlmadyson

Gollum says; Ponzi! Ponzi! Ponziiiiii! Cough!

Thu, 01/05/2012 - 11:19 | 2035420 TzaristBondHolder

Replaying the Margin Call movie only this time there are no buyers and they buy themselves!

Thu, 01/05/2012 - 11:21 | 2035423 Seasmoke

i help you, you help me......fuck everyone else

Thu, 01/05/2012 - 11:20 | 2035424 Sizzurp

Nothing a few zeros on Bernanks screen won't fix. A few keystrokes and "Ahhh that was strenuous, now off to the club for lunch".

Thu, 01/05/2012 - 11:21 | 2035427 williambanzai7

This is a foundation of modern finance now.

Thu, 01/05/2012 - 11:25 | 2035442 Irish66

Amazing how clear that is and the color just pops

Thu, 01/05/2012 - 11:31 | 2035456 MsCreant

Alternate to Euro Bail:

"Euro Fail"

"Euro Flail"

"Euro Check Kiting Zone"

Nice work

Thu, 01/05/2012 - 12:10 | 2035563 HardlyZero

Eurotic Fluffer.

Eurotic hand-job ?

Euromancer (sorry William Gibson, author of Neuromancer).

Thu, 01/05/2012 - 11:33 | 2035460 hedgeless_horseman

Is one pen black ink, and the other red ink? Or are they both red ink?

Thu, 01/05/2012 - 11:38 | 2035478 MsCreant

I know I'm seeing red. So do a lot of folks.

Thu, 01/05/2012 - 11:52 | 2035525 williambanzai7

I can't tell you how rewarding it is to be able to take images and pictures that I loved all my life and now adapt them to current use. It really is a creative rush.

Thu, 01/05/2012 - 12:08 | 2035602 Schmuck Raker

Very nice, William.

Thu, 01/05/2012 - 11:23 | 2035432 ucsbcanuck

Great. Let the shitstorm begin. My popcorn was going cold.

Thu, 01/05/2012 - 11:23 | 2035433 lolmao500

Yep, everything I learned at school on economics doesn't apply anymore.

Thu, 01/05/2012 - 11:28 | 2035450 s2man

That's what I told my son, who is enjoying his college econ class.

Thu, 01/05/2012 - 12:21 | 2035669 economics1996

The economic text books are full of shit. I teach the shit. All the Keynesian modeling crap is BS. Tell your kid to suck it up, pass the class, and get some Murray Rothbard to clear his head out after the class.

http://usa-wethepeople.com/2011/12/what-is-the-real-gross-domestic-product-down-6-8-from-2007/

http://usa-wethepeople.com/2011/02/y-c-i-g-nx-and-the-gdp-bull-crap-numbers/

http://usa-wethepeople.com/2011/07/usa-university-economic-propaganda-exposed/

The last one is the shit I uncovered in text books that was pure 100% lies. Enjoy!

Thu, 01/05/2012 - 12:00 | 2035560 valley chick

they actually teach this shittt? /sarc

Thu, 01/05/2012 - 12:22 | 2035675 economics1996

Here, this link is for you.

http://usa-wethepeople.com/2011/07/usa-university-economic-propaganda-exposed/

Pure bull shit taught in universities.

Thu, 01/05/2012 - 12:25 | 2035686 economics1996

It never applied, it was all bull shit propaganda meant to get you to be an obedient citizen.

Thu, 01/05/2012 - 11:23 | 2035435 Undecided

Barclays downgrades Canada financial sector

http://ca.reuters.com/article/businessNews/idCATRE8040OV20120105

Bank Spreads Widest Since '09 on Europe Contagion: Canada Credit

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2012/01/04/bloomberg_articlesLX9YML6VDKHZ.DTL

Thu, 01/05/2012 - 11:35 | 2035470 lolmao500

All the banks they downgrade are the bankrupts ones who pledged their entire deposit bases in CDS...

Thu, 01/05/2012 - 11:24 | 2035440 apberusdisvet

The problem is that "yours" is shrinking and is unacceptible for economic intercourse.

Thu, 01/05/2012 - 11:34 | 2035463 HardlyZero

Is there a fluffer in the house ?

Hey, why can't the banks just go "off planet" and run their banks from the Moon ?

They would not be tied up with any fancy laws and they could dump their paper on the Earth all day and night long !

Maybe there is a new NASA contract ? It could be win-win...we get a way to get away from this mess. Kind of like a reverse (or perverse) Man Who Fell to Earth.

Thu, 01/05/2012 - 11:27 | 2035448 Quinvarius

Taken to extremes, you can see how all this debt is a farce and meaningless. It is all just excuses to create money. Imagine two banks creating money to buy each other's debt 100% and using that debt as an asset like this nonstop. Fiat money is a joke when you let banks in on the party wiith fractional reserve lending.

Thu, 01/05/2012 - 11:27 | 2035449 MsCreant

The banksters hire mobius strippers for all their parties. It seems they are always undressing but never finally appear to be naked. The emperor loves them, but he is a naked short.

Thu, 01/05/2012 - 11:39 | 2035479 s2man

Witty, MC. Very good.

Thu, 01/05/2012 - 11:30 | 2035453 lemosbrasil

That's hillarious !! so comic !!!

Thu, 01/05/2012 - 11:32 | 2035459 fonzanoon

BAC. It hurts to watch.....Reggie? Reggie???? whats happening?

Thu, 01/05/2012 - 11:37 | 2035476 HardlyZero

Someone has BAC's backside in control now. Good fluffer. All the banks want this fluffer. Got fluffer ?

Thu, 01/05/2012 - 11:49 | 2035514 jomama

does a fuzzy blumpkin count?

Thu, 01/05/2012 - 11:38 | 2035477 HardlyZero

(got excited)

Thu, 01/05/2012 - 11:35 | 2035471 fonzanoon

Does anyone else's balls ache when they look at Bank of America?

Thu, 01/05/2012 - 12:11 | 2035619 K_I_T_T_Y

it will not last long, believe me....

Thu, 01/05/2012 - 11:42 | 2035489 Joe Davola

http://www.youtube.com/watch?v=7oyfcfgdYsE

Thu, 01/05/2012 - 11:43 | 2035493 bbelux

Maybe the capital increase @ 1.943 and the 2:1 ratio may add to the pressure no?

Thu, 01/05/2012 - 12:17 | 2035649 Jlmadyson

Euro at 1.279. Oh the pain that is coming.

Thu, 01/05/2012 - 12:20 | 2035659 blunderdog

They should just go swapsies and call it even.

Thu, 01/05/2012 - 13:28 | 2035986 Georgesblog

If it were only Italy, the news wouldn't last long. As we've seen, this disease is contagious. This is going to turn into a barfight at an ice cream social.

http://georgesblogforum.wordpress.com/2011/11/02/the-daily-climb-2/

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I'll Hold Yours If You Hold Mine: The Italian Ponzi Comes Home

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