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IMF Says 2 Year "Funding Gap" Hits $1 Trillion
First we learn the LTRO may be €1 trillion, then €10 trillion, now the IMF tells us it has misplaced $1 trillion. The world may be going totally broke but at least it does in style - in perfectly round 12 digit numbers.
- IMF SAID TO SEE POTENTIAL 2-YEAR FINANCING GAP AT $1 TRILLION
- IMF SAID TO SEEK RAISING LENDING RESOURCES BY $500 BLN
In other words, even after it "miraculously" procures this money, the IMF will still be half a trill short. But, with everyone broke, just who will "fund" the IMF shortfall? Hm, could the fact that stocks are rising indicate that the ultimate buyer will be none other than the global central banking cartel. In other news, with every passing day we learn just how correct our thesis has been for the past 3 years: the it is not a liquidity crisis, it is all about solvency. Or rather insolvency. Global insolvency.
More on this farce from Peter Tchir.
This is starting to be more and more like a bad Austin Powers movie.
Why should this group of unelected, many appointed based more on their political connections than their qualifications deserve so much money?
This was a cute and slightly prestigious entity when it helped channel the charity of big rich nations into small developing countries. Whatever their mandate was, this is now getting ridiculous. On the other hand, I will admit that at least they attempt to due their job with diligence as opposed to the IIF which has to be the entity with the least credibility (usefulness) that has somehow found itself thrust in the middle of developing plans.
The list of countries the IMF wants money from is almost comical. Japan is right up there. Of any country listed that may at some point need their own bailout, Japan is front and center. The bears are lining up to take a poke at JGB's. Most have been burned from time to time over the past 20 years shorting JGB's, but the stars do seem to be aligning for a shot.
Yesterday we rallied on news that China remains weak enough to need stimulus, yet here they are on the list of countries expected to make the IMF savior of the world (technically, they can't save the world until they create their own central bank, but how far off can that be?).
Brazil, Russia, and India all see to have enough of their own issues that stepping up their IMF contributions seems unlikely.
I assume the oil-exporting nations we are asking are the ones that we aren't going to embargo in 6 months (or just as soon as we don't need to buy their oil)? Or maybe it is the countries where the rulers (not really leaders) buy private jets with hot tubs, yet many of their people have a standard of living that most Europeans would consider appalling.
On the other hand, the market is either too long, too mature, or just realizes the likelihood of this happening (nil) that it couldn't even bother to jack up stock futures much. Kind of dull when a good old fashioned trillion dollar rumor can't cause much of a spike.
If 2011 was the year of "broken" markets, then 2012 is shaping up to be the year of "apathetic" markets.
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from funding to funnelling
You got that right. It's going to take an earthquake to break those pipelines.
Current politicans aren't the solution.
Global Insolvency.... please stop with the bombastic rhetoric. Maybe Global Misallocation would be a better phrase. There is still value here. Farm land, timber, water, oil, labor. Lots of assets does not represent insolvency... it is all just valued wrong.
Who's time should be worth more? A scumbag ambulance chasing lawyer (or even a comuunity organizer) or a man that knows how to grow and produce food to feed people?
INFLATION BY HOARDING WITHOUT CREDIT CREATION AND WITHOUT MULTIPLIER EFFECT:
Keynesians and Monetarists do not understand the process of inflation without credit Creation. Inflation without credit creation works the following way. Money as per Hayek should keep a stable relationship against a basket of commodities in order to satisfy the needs of savers. If money is stable against commodities, the population will buy commodities for current consumption and put the extra into money trusting that they can slowly use the money for future consumption of commodities. If the money does not keep the relationship with commodities, the public will buy the commodities as a substitute to money which is "INFLATION BY HOARDING". All of the sudden commodities will have the current consumption and the future consumption added up in the price structure. The consequence is that the proportion of income which goes for food and energy goes up for the middle class (commoners in the old days). This makes the population poorer and diminishes the taxing power of the government. This in turn makes the public more suspticious about the currency as a good savings medium and forces people to hoard more commodities. This moves prices up, makes people poorer, erodes the fiscal situation, increases distrust in currrency, this in a feedback loop which is a RUN ON TEH CURRENCY. BUY SOFT COMMODITIES. KOO does not understand that inflation can happen with the multiplier down. If I withdraw my money market fund to buy Wheat commodity fund, there is 0 multiplier, yet it will result in higher basic commodity prices if there is a continuous flow of people doing that. Many economists do not understand inflation outside of the multiplier effect.
1 trillion is a 13 digit number.
:-p
that'll please the ladies in the room!
“when it helped channel the charity of big rich nations into small developing countries.”
I used to think that before I got educated.
The IMF’s sole mission always been to get developing nations hooked on FRN debt.
The PTB are trying to set the IMF up now as the new savior by acting as the front man for central banks.
It will hypothecate the perception of value from worthless crap now on the CB books and use SDRs to pull same swap tricks the FED and ECB are doing at this very moment.
A new level of complexity that layers time, stocks and flow to keep the con going.
New liquidity, same old insolvency.
In their great scheme of things the French created Françafrique in the 60s, a comprehensive scheme for ex African colonies, whereby they had SOLE access to their RM in exchange for a French monetary line called CFA, pegged to the French Franc, and nominal aid in form of educational and cultural pennies to each pound paid in RMs. Ask those African countries how the CFA worked out for them over nearly fifty years...the answer is an education in itself...Vive la Françafrique..A small version of IMF dipped in french "jungle juice", local version of monetised gallic hydromel, old nectar of the Gods!
chump change in Warren's sofa, ask the maid.
Two number number....Zeros don't count ! Monedasbabble 2012 PSA: My bad....according to Websters....Zero is a number, a numeral, a digit and a cipher ! Money makes the world go 'round !
I think global insolvency is accurate. It's the nature of a the monetary system. Virtually all "money" in the system is created as debt (Fractional reserve banking... no matter what the original asset may have been, "money" is created when it is loaned into existence). The interest that begins to accumulate when that money is loaned does not exist. So the system, in order to stay solvent, must create more money (i.e. issue more debt).
There isn't enough "money" to pay the debt. That is insolvency. This is very much a global ponzi scheme. What you are talking about, when you talk about farm land, timber, water, oil and labor are clearly real and tangible things. And when our global monetary system collapses, it will be a good idea to have some of that stuff.
This ends either in a deflationary depression that makes the 30's look like a walk in the park, or with a coordinated effort to print our way out which will make the 30's look like a walk in the park. The net effect will be the same... the destruction of the myth of money.
I have been hearing and reading those predictions since 2002 when I first began investing in gold.
So far my returns have been great, but the monetary system has only become hyper fiat from where it was then.
Many people never handle cash. Direct deposited pay checks go into your account only to be allocated out via internet bill processing. It isn't even paper, only an accounting entry. While many predict the currency collapse, the evolution is suggesting something else. Currency transformation.
The story hasn't changed since 2002... we are simply on a higher point on the exponential curve of global debt expansion. Another couple of rungs have been added to Ponzi scheme. http://media.pimco.com/PublishingImages/IO%20Jan%202012%20Fig1.png - here is chart for the US, but spend some time on google images and do all sorts of different searches. "private and public debt" and then pick a western economy. The charts all look the same.
I'm not sure why handling cash vs. digital entries really makes a difference at the end of the day. I suppose it makes it easier to "print", but it doesn't change the nature of the relationship between creditor and debtor.
On your last sentence... sure... we will witness a currency "transformation"... namely, the destruction of our collective belief in our current monetary system. It will end and it will be replaced with something else. Our ability to expand credit is coming to an end... consumers are tapped out, corporations are tapped out, and "sovereign" governments are tapped out.
You saved your best sentence for your last! Right there is why things are going to change, and in a big way.
Well it just can not all stop. The force of human need will bring a new method of exchange to the real markets.
What do you consider more likely:
1 - A jubilee?
2 - A complete crash?
3 - A revaluing of the current system allowing the can to be kicked further?
I have no doubt it will be number 3. Assets will be revalued. Some for the better, most for the worse. We will all lose, but the banks will lose less.
4 - WWIII
Choosing 4 accomplishes 1 in the only way possible (who is going to pay debts to a country who they just defeated in war)... Choosing 4 allows for 2 to take place but for the blame to be placed on people other than the finance oligarchs who profit from the creation of money (let me create the money and I care not who makes the laws).
I am interested, if you are still visiting this thread, in understanding what you mean by #3. What is the mechanism through with this revaluing takes place? Is it a re-issue of currency with zeros added or removed? Who is revaluing the assets?
I would really like to understand how a "way out" might work... I just don't see it. We are staring into the abyss.
BRIC will contribute.
Sure they will.
While killing their own populace in the process. What a win-win eh?
"India will have to contribute upto Rs.15,000 crore (about more than USD 3 billion) to the International Monetary Fund (IMF) following the decision of the Fund to double its quota."
Crazy world. Broke nations, totally rag-clad broke nations have to pay into this den of vipers?
Sick.
ori
truth/
Seriously?
I think you will find that Russia is broke and that Brazil, India and China have already answered this silly call down in Mexico.
They all pointed out the impossibility of asking their citizens to bail out an economic union that enjoys per capita GDPs, standards of living and social insurance multiple times greater than their own.
Some BRIC governments might be as morally bankrupt as the Eurocrats, but their populations are relatively educated and more prone to violent exersize of democracy than the constituents of the European aotocracy that has it's cap out. They will not wade into the quicksand.
And as Brazil and China have both pointed out, transfer payments from the poorest of the developed world to the richest are unacceptable to their populace and utterly morally bankrupt.
Will never happen...
By apathetic markets I suppose that they mean that the retail sheep will abandon the casino, leaving only the big professionals trying to rip each other off with their HFT crap. Should be interesting to watch.
You know - TPTB should be on their knees thanking God that the average person is ignorant (or willfully ignorant) of just how badly they are being fucked. Because if and when the reality hits the masses - living in a gated community surrounded by a team of rent-a-cops isn't going to save them from the torches and pitchforks.
Let’s hope so as I cannot see any other way they will pay
hey, no biggie, who wouldn't like an additional $500,000,000,000?
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The average person, for all of recorded history, has been ignorant and will continue to be.
So we've had a couple hundred years of living as 'free' men with liberty and property and all the wonderful things that were supposed to come with it. Now it will be back to the thousands of years of serfdom, servitude and tyranny that humanity has always known.
The games always the same, the players just change.
Speaking of history, in 2013 we will be celebrating the 100 years anniversary since the establishment of Federal Reserve. That may ironically also be the year when the dollar will have lost 100% of its value since 1913.
Foz , znbz and Clean Channel will give second by second assurance that god has everything under control so all you left wing nut alarmists will be discredited, sprayed, and bused off to rehab, while we search your computer files for porn.
I know two venture capital guys, The "people" they employ to provide security at their homes in Hawaii and Aruba are hardly "rent-a-cops". Wake the fuck up dude. Try to approach the grounds of these estates and you won't see the infared beam that marks you milliseconds before your death. You are correct, many ignorant mother fuckers out there.
I think I read about this in a book (New, New Thing, maybe) or maybe I watched this on some Discovery Channel show... I don't remember exactly, but they were talking about the security on some Russian Oligarchs yacht. It was full on James Bond kind of stuff... the technology, the fire power, the personell... it was remarkable. I remember thinking at the time, "if this is stuff they are showing, what kind of stuff aren't they showing?
These people have all of the fake money in the world... and I'm positive they are trading as much of that fake money for real money as they can... to include the systems needed to protect it. The middle managers of the ponzi scheme... those guys might be vulnerable, but not the oligarchs.
No Prob....Barney Frank created a bill to give the IMF a line of credit for 1 Billion, or was that 1 Trillion. The rest of Congress agreed with him, no credit check required. To quote a rabbit... Funny taxpayers, tricks are for citizens, money's for politicians
It's priced in. Rally on
Bullish.
yep...futures up on more massive unvolume. Calling all momos, calling all momos!!
So the central banks print into infinity, prop up their own asset prices with it by paying themselves for it and they never have to sell them at market prices. They hold junkloads of crappy stuff, the banks are recapitalized as they unload it onto the central banker balance sheets in exchange for freshly printed cash. Might as well buy everything and deliver it all to the Feds. No need to ever worry about losses again.
What's the problem?
No problem at all. Of course there's also no jobs, no debt reduction, no growth. Other than that - the Fed and ECB got this.
As Nancy Reagan said:
JUST SAY NO!
Somebody seems to be living beyond their means.
Live styles of the rich and famous?
Criminals on one last spree
I've always thought that underpopulated countries in Africa are vastly underpolluted.
"The central irony of financial crisis is that while it is caused by too much confidence, too much borrowing and lending and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending.'' Guess who?Lawrence Summers
Summertime! When the living is eeeasyyy...
That song smells like marijuana.
Sorry, but most people can even fathom what a trillion even is.
It's sailing right over the head of 95% of the population.
Now, back to buying every ES contract you can get your hands on.
I have about one trillion grasshoppers here. Would the IMF like to fill its funding gap with those? Quality grasshoppers these ones, they eat everything & anything.
nice collateral..
This is becoming tragic. The wealth transfer is gathering speed from taxpayers to the corporotocracy, desperate to cling onto power and market valuaitions.
When the crisis began in late '07, people gasped as the CBs printed a few billion, but now we're immune and a few trillion is the standard and all people care about is the Ipad3.
My' friends' say to me...'why do you read all that depressing stuff?'.
THEY ALL LOST THEIR HOMES to adjustable mortgages resets, have 1099 income tax burdens to now face and would not listen then and won't now.
Thank you ZH for keeping me safe and depressed!!!!!!
WE LOVE YOU
i now have a Zero Tolerance Policy for stupid people. They deserve all the bad shit that comes their way
Insolvency solved.
Have they hired Robert Mugabe as their financial advisor?
L-Oil-L, somehow the MBA composite index is up +23%. Maybe the same person that calculates the IMF funding also does the MBA Index. #REF means you move the decimal over, right?
"Funding Gap" -- just like in Europe, for sure. Meanwhile, investors are lining up for bonds. The X-trillion refunding this year gives major opportunities, not collapses. We'll simply make it through the year. Funding crisis? -- Don't believe the hype.
It's a sequel...
Oh SNAP!
"I'll bet you $1 trill that there will be a more than $1 trill liquidity injection"
- Mitt Romney
This is just more "keep 'em guessing", opaque, and non-definitive news drivel that we're likely to see in the next month or two. I'm waiting for the huge snapping sound of some major bank (or soveriegn CB) that got taken out. The S&P hitting 900 or maybe 750 in a few days should be in order.
The other thought is that we'll have to wait until after November 6th to see the real fireworks.
A trillion here, a trillion there, and pretty soon you're talking real money.
I heard the I pad 3 is edible
The plastic parts anyway... I hear they eat plastic rice in China
This news is very important that the market seems to be ignoring. The reality of the desperate European situation will soon set in and that will mean trouble for the markets. The markets are on borrowed time as many indexes and currencies are at very important inflection points, which could set the tone for the rest of the year. Here is a look at the SPX, TNX, HG, CL, and AUDUSD. These are some very important charts. bit.ly/AlRxjr
Market talk about Golden Cross...when they should be talking about Gold bars ! Full steam ahead, wave to the shoreline, don't pay attention to the shoals until we hit them. ALL ABOARD !
1 trillion = 1 million x 1 million.
In 1913, the national debt was less than 5 billion and backed at one ounce of gold per $50 of debt.
I just thought I'd add those facts to illustrate how completely desensitized the world is to a lot of zeros. No one ever suspects the bubble they are really in.
its only fiat, and not even a panda!
If we are all in the free-falling bubble together...it looks relatively normal. Until we hit the shoals and the bubble pops, then we hit the rocks, and we have to swim to shore...wet, cold, waterlogged, and all our stuff just went down in the Costa Concordia. Fun trip while it lasted.
The IMF with a blessing from the financial Vatican, the "square mile" on the north bank of the Thames, has got it covered with the natural resources of the ME and Africa. Their servant G.W. Bush announced it at the G8 meeting in 2003 calling it "The Greater Middle East Project". That together with the establishment of the Center for Applied Non-Violent Actions and Strategies, and U. S. Africa Command (AFRICOM, est. 10-1-07), will ensure that these resource rich nations are fully developed and democratized. Bringing light to the dark continent and peace, prosperity and cooperation to the grumpy old Levant (before the Chinese do).
Now that is something to hope for!
Bringing democracy to Africa would do wonders for the World Economy.
Democratized, not democracy. Less Vaclav Havel more Idi Amin.
Money is power..and the IMF wants a lot of power...just think of the new private jets you could buy with all that money..and to be able to fly around the world with your security detail and handlers to meetings and good food....wow...I want some
IMF Lifestyle: room service, party. Wash, rinse. Repeat.
Caligula's Floating Brothel ?
Oh, when the saints go marching in, we'll sing that number, and it'll be in millions, in billions, in trillions; until the Lord Saviour comes, and then, we'll sing it in quadrillions! Oh when the Saints...go Marching in...we'll sing that numberrrrrr.
Does Corzine run the IMF also? Missing $1 Trillion?
"I have no idea where the money went."
They will probably put him out on IMF detention soon. Maybe he will be the new IMF ruler. Once Jon leaves the country he might be able to become a citizen of another country....or just stay in a jet all the time or stay in a floating boat off shore...never touching land again. Rogue Ruler.
"with every passing day we learn just how correct our thesis has been for the past 3 years: the it is not a liquidity crisis, it is all about solvency. Or rather insolvency. Global insolvency."
not exactly - it is meant to look like this
peak oil was to bring about economic collapse - peak oil IS being defined by economic collapse
what this is - an intentional "power down" of the globe.
the ARMs in 2006-2008 were the fuse lit - to crash commerce JUST AS OIL WAS PEAKING.
yes - the globe is broke, but not because it is out of money...because its ability to grow itself out of debt through cheap unlimited energy is no longer available.
the power brokers only mitigated the timing to their favor. until their bunkers are full of food.
it is time now....the effects of peak oil cannot be papered over any longer
I think Peak Oil is a part of the scenario, for sure... but the fuse you are talking about is only one rung in a finance Ponzi scheme that has been going on for a long time. We may be wittnessing a horrible confluance of events (peak oil in combination with, let's call it "peak finance fascism, fractional reserve fiat fuctardation")... of maybe we canjust call it peak exponential function, becausee that is what is destroying us, both in energy consumption and debt expansion.
perhaps
but most would agree that the collapse of the housing bubble triggered the current predicament
does anyone really think the power brokers did NOT know of peak oil?
not likely
If they need my printer, just give me a shout ;-)
In other news, I seek an additional $1B of funds. Seriously, why not.
I promise to hire at least an additional 10 people with that money (i am going to need a pilot, a chef and a houseboy, to start).
I will be making that announcement tomorrow. Feel free to frontrun.
So lizzy... You actually ARE the FLOTUS! Ladies & gentelmen, we have ROYALTY on ZH!
It was rather bizzare tonight to listen to a bunch of European globalists from The World Bank on ABC1 Australia's 7:00PM news bulletin saying we're in for another 2008-style global systemic credit lock and trade collapse.
They emphasised that it would be like 2008 but a lot worse than 2008, and last longer because there were no rosources left (public money) and policy tools that had not been used to 'stimulate' demand and employment.
No pump-priming mechanism at all (...except the suicide of printing monopoly money ... literally).
They looked scared and desperate. The basic message was there's nothing left that can be done but to "get ready", and that people and businesses should expect it. It was clear they're not talking about it being far away.
uh oh... when the idiot box starts telling the truth...
Maybe Austin Powers could just write a check from his Chase Credit card, now that they aren't collecting on bad debts. Woud Jamie bounce a check payable to the IMF for $500Billion?
"Mittens Romney Would you have signed the 'NDAA'"
Mitt Romney - 'Yes i would' but first i would do a speech about signing it for $300,000 a time you know .... chump change.
Awwwww...no karaoke machine in that wish list lizzy, we relly wanted to see you dance some more... Dancing With the Stars might have come calling... :)
Monedas predicts, if they are not already doing it, that the Fiat Despots will use their funny money to line each others pockets with PMs when the ship starts sinking......like an Italian cruise ship captain takes care of numero uno ! IMF is just one of the tools when they begin to raid the PMs for themselves ! They are doing it already by throwing obscene amounts of money "their way" and some of that is going into Socialist bureaucratic personal pockets as PMs ! Hang on to your pitiful, hard won stacks....don't sell to these beast or they will still be inpower after TSHTF....capice ? If they didn't get enough they will confiscate ! Monedas 2012 Socialist greed is the nastiest kind of greed and has no relation to productivity !
$1 Trillion short.....? Did they think to strip-search Strauss-Kahn before he left his tips ?
This is not a liquidity crisis.
This is not a solvency crisis.
This crisis is the absense of honesty and liberty.