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Initial Response To Merkel Conference
From Peter Tchir of TF Market Advisors
Plan seems long on big picture idea, short on details and short on other member states being consulted. Feels like more concrete, immediate action, was already priced in. If anything, seems like they are going to start taking money from banks to pay for bailouts of banks. Makes sense in a weird way, if you believe banks should be bailed out, but don't think that was the "support" the market was looking for. With all the short covering, and high expectations, I think market will end up the day disappointed.
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Who is going to print? The Germans or the French or both.
Seems the French can now pile into UST's since their AAA+ US debt rating confirmation.
A euro bond would actually put pressure on the Treasury if it were ever created. Because the Chinese and others would find it as attractive if not more so. At the very least a way to diversfy from US T's. I'm not so sure the Bernanke wants that competion.
both sark and merk are crystal clear euro bond a non starter
everyone
Print faster please! Hasten the head-on train wreck!
Something's always gotta give :)))!
Huh? Market didn't even move.
EURUSD bumped higher and some French CDS were lifted (2x) but ya, nothing crazy like last week.
Well, markets have all that 'priced in' money theyre sittin on.
rule 34, the €urito is over
http://www.entendance.com/forums/viewtopic.php?f=6&t=784&p=18769#p18769
We've entered end game- banks cannibalize each other, no Euro printfest, QE3 looks like a fart in a hurricane $300 billion. Time to get out.
Quck - take a memo to WillamBanzai: movie poster should read "Around the world in 80 days" - pitting Helicopter Ben against Angela in her Zepplin, and Nic in his Hang Glider -- bags of cash are no object, just a matter of whose Ponzi in the sky can stay afloat longer
This is the funniest press conference I have ever seen.
They both say nothing and it’s damn obvious from their confused looks they have absolutely no idea what to do.
Damn this is entertaining - it’s like a watching a 5 years old doing show and tell....except the kids would know more
Au royaume des aveugles les borgnes sont rois.
Prominently missing was a Bernankean promise to keep euro rates at zero till mid-2013.
No free money? Then I'm checkin' out! SELL EVERYTHING!
i'm guessing trichet's got his finger on the buy button
He seems to have mistaken his sphincter for the Enter key.
Is this news what hit ES?
Guess so...not much of a 'hit' though at -5 considering ES is up 100 in 3 days.
The market apparently supports moral hazard in this case.
my practicing practicing has it down over three hundred at the end.
All is well though, as the only firm news from the meeting is the idiot Von Rompuy will be EU president for 2 more years.
i think the belgians have a word for van rompuy- anodin
http://www.youtube.com/watch?v=Fyq7WRr_GPg&feature=player_embedded#!
THAT GUY IS THE BIGGEST IDIOT ON EARTH!!
HE WRITES UNREADABLE POEMS GODDAMEND!!
HE'S THE BIGGEST RETARD WHO LIVES OUT OF THIS PLANET!
Faz spiked beautifully
Has anyone ever been to that city in Germany, oh yes it's called Nothingburger. I believe it's on the outskirts of Hamburg.
Is that near Shitburger?
Sarkozy: "I'll show you mine if you show me yours"
Merkel: " once you've seen Ben's, there's no other that can compare"
what's all this golden rule nonsense they are talking about
these two monkeys make Obama seem like Winston Churchill
just now Merkel
"Had people been more responsible in the past we wouldn't be facing these problems now"
Well if you buy or sell stock in EU, you are gonna be taxed.
Maybe if you deposit or withdraw from the bank?
http://www.bloomberg.com/news/2011-08-16/france-germany-to-propose-finan...
Thats it, massive new regulations, penalties, and sea of red tape will certainly fix markets no one trusts at all. Nice work.
Huh...well maybe this -100 point DOW plunge is the 'fear and panic' catalyst that will allow Ben to announce his paltry $300 billion QE that has already been priced in? ZZZzzzzzzzz.
that fitch rating on US debt was a nice kabuki piece, now that was superb acting. Move along sheeple ! goddammit MOVE!
Finally the EU is getting their own Super Congress to make it appear they are going to do stuff. They are so behind the times.
Merkel
"we need to practice what we preach, for sometime now in Europe we have discussed the use of harmonized indicators, the markets are telling us that if we want a common currency we need more harmonization"
"we will tell Rumpel that the golden rule should be put into effect in 2010"
Sark now talking about a franco german economic area
To me, it seems as if countries in southern Europe are pretty confident that they will get their money from Germany one way or the other. If they don´t get Eurobonds they just may force Germany to give more money to other countries by a majority decision in the EU. As far as I can understand, it is now possible for 55 % of the EU countries to force a minority to give their money to the majority. In the past, it took a unanimous vote to do so.
Perhaps some people now also will argue that the EU now needs to become one country so that the euro also can become a credible reserve currency so that Europe also can print money like the US for while in order to cover budget deficits.
I suspect that it will be better for Sweden if Germany and the Netherlands voluntarily pay for the southern European countries debt so that non-euro EU-members don´t have to pay as much.
I think that there is no doubt that the ruling parties in the EU want the EU countries to merge into one country. The debt crisis and the possibility to print money may serve as a “rational” argument for that when trying to persuade hesitating politicians to agree.
However, I doubt the euro will be able to serve as a reserve currency for a long time. As China and other Asian economies grow the possibilities to use the euro and the dollar as reserve currencies will probably shrink. When Europe has merged into one country it will might be too late for the euro as a 2nd reserve currency. But I don´t think that the European leaders will care once they have got their completely unified Europe.
I think that the best solution for countries in Northern Europe would be that they paid a fair amount of money for public buildings etc in Southern Europe and that the Southern European countries used that money for reducing their debt. If Spain and other countries would hurry to sell everything to the highest bidder right now the result would might be fire sale prices. So that wouldn´t solve any problems. But it is outrageous to force German, Dutch and Swedish tax payers to pay for Spanish debt without any securities, especially if we consider the hundreds of billions of dollars that already has been given to Southern Europe.
sark
"The french have enormous respect for our German friends, in history we have been enemies but now we must not be afraid of this rapprochement"
merkel
"I think it is interesting that when sark and I engage in discussions we can make use of ideas from the south of Euorpe or the north, we can build a joint vision in the context of globalization but there are no gaurantees but since the 19th century we have generally known periods of growth, we need to unite if we want to reach our goals"
Looks as if they are proposing a variation of the "Tobin Tax". It is a transactional tax on that would look to curb speculation. It would require cooperation from the major developed countries.
In the short run, a coming Tobin tax is an incentive to SELL NOW.
Save the HFT algos! With a Tobin tax, they'll be put out of business in Europe.
Sark
"We are heading for a confederation"
"We are closely monitoring the situation and will act ... uh, maybe, sometime, then, whenever........uh"
and as a European I already know THAT EVERY FUCKING LEMMING WON'T EVEN REACT ON NEWS LIKE THAT BECAUSE NOBODY GIVES A RATS ASS ABOUT POLITICS!
SO:
IN EUROPE WE GET A UNELECTED PRESIDENT
IN AMERICA YOU GET A SUPER CONGRESS THAT DOESN'T HAVE TO ANSWER TO ANYBODY!
IT LOOKS LIKE TYRANY, IT SMELLS LIKE TYRANY, IT TASTES LIKE TYRANY
HELL IT MIGHT EVEN BE TYRANY!
To me, it seems as if countries in southern Europe are pretty confident that they will get their money from Germany one way or the other. If they don´t get Eurobonds they just may force Germany to give more money to other countries by a majority decision in the EU. As far as I can understand, it is now possible for 55 % of the EU countries to force a minority to give their money to the majority. In the past, it took a unanimous vote to do so.
Perhaps some people now also will argue that the EU now needs to become one country so that the euro also can become a credible reserve currency so that Europe also can print money like the US for while in order to cover budget deficits.
I suspect that it will be better for Sweden if Germany and the Netherlands voluntarily pay for the southern European countries debt so that non-euro EU-members don´t have to pay as much.
I think that there is no doubt that the ruling parties in the EU want the EU countries to merge into one country. The debt crisis and the possibility to print money may serve as a “rational” argument for that when trying to persuade hesitating politicians to agree.
However, I doubt the euro will be able to serve as a reserve currency for a long time. As China and other Asian economies grow the possibilities to use the euro and the dollar as reserve currencies will probably shrink. When Europe has merged into one country it will might be too late for the euro as a 2nd reserve currency. But I don´t think that the European leaders will care once they have got their completely unified Europe.
I think that the best solution for countries in Northern Europe would be that they paid a fair amount of money for public buildings etc in Southern Europe and that the Southern European countries used that money for reducing their debt. If Spain and other countries would hurry to sell everything to the highest bidder right now the result would might be fire sale prices. So that wouldn´t solve any problems. But it is outrageous to force German, Dutch and Swedish tax payers to pay for Spanish debt without any securities, especially if we consider the hundreds of billions of dollars that already has been given to Southern Europe.
(This doesn´t mean that I think that printing money is generally good for the United States. I think that it is risky and that the inflation also harms American consumers and small/medium-size savers. But I think that printing money currently stands out as a more attractive solution than raising taxes or cutting domestic spending. The only solution that probably would be better for America is eliminating military spending abroad, raising import duties and minimizing unnecessary supply to the labour market, i. e. something similar to what Pat Buchanan advocates.)
Great, how long till we start seeing "container people" coming in from France and Germany now?
American dollar is and will continue to be the reserve currency.What matters,in terms of global balance of power,is control on world resources industrial capacity and powerful army.Note that both Britain and American had all of them as reserve currency countries.
Dollar's position is being questioned because USA is actually a nation that imports both resources and industrial products in strike contrast with say 50 years ago.Still USA and its "allies"control most of world's oil resources primarily due to american armed forces.In other words dollar's position depends on the power of american military,the money spend on weapons protect dollar's status mora than anything else.
At this point no other currency can claim dollar's place,both eurozone and china lack one thing,control of resources.China's and GErmany's industries mean nothing if they can't get their hands on resources.China's "economic miracle" would turn to a nightmare just by a slight distortion in the supply of resources.
In my eyes the key player in this geopolitical game is Russia.Ony Russia backing with its resources either eurozone or China(propably eurozone) can challenge dollar's and America's position.
Nice puke in stocks not too long after this article. Thanks tyler
Then, brothers, it came. Oh bliss, bliss and heaven:
Merkel And Sarkozy Propose New European Economic Government