"Lehman 2.0" Imminent Warns John Taylor
By John R. Taylor, Jr. Chief Investment Officer FX Concepts
Lehman 2.0
Global investors either have extremely short memories or they are far too concrete, as my wife the psychologist would say. Saying that Greece is not a bank but a country means nothing. Almost all Europeans argue that a default by the Greek government would now be more straightforward and not as significant as the collapse and bankruptcy of Lehman Brothers in September 2008, especially since the Eurozone, under the influence of the surplus countries, has effectively ‘ring-fenced’ Greece from the other 16 members. Lehman was not a very large factor in the global banking scene with less than one quarter the capital of the biggest US banks and with assets below those of more than 100 banks around the world. Greece might represent less than 3% of the GDP of the Eurozone, but when lined up against Lehman, Greece stands larger in its relevant market. Anyone can read the newspapers, blogs, and Internet scribblings before the Lehman collapse and see that the impact of its collapse was not expected to be significant. Tim Geithner, then head of the New York Fed, worked to arrange the emergency liquidation of Lehman’s assets and there were expectations that the company could be sold to Bank of America or Barclays, but the Bank of England vetoed a sale to Barclays and the US government refused to lend any support to Bank of America in its effort to buy Lehman.
Rereading the documents and remembering the situation as I set out for a weekend cruise on the Chesapeake, the world was not worried. The market had already seen the rescues or restructuring of Washington Mutual, Countrywide, Fannie Mae, and Freddie Mac, so no one was worried. This looked like another Bear Stearns, a manageable problem but this time the Bush administration was not interested in getting involved – ‘let the market solve this, don’t throw good money after the bad.’ So, what is the difference now? The world is as blasé about a Greek default or departure from the euro as it can be – credit spreads are dropping, the other weak Eurozone sovereigns are financing themselves easily, and everyone thinks the LTRO has solved the problem for the next year or two. Why should we worry about Greece? Who cares if their unemployment is 20.9% and climbing very fast, or that it is now in its fifth year of declining GDP? Let’s teach them a lesson!
Hubris is at the heart of this. Everyone says this cannot happen – we won’t allow it. Says who? The EU says: if it is written in an agreement, it must be totally correct, unchangeable, and followed at all costs. New realities can’t intervene and no slippage is allowed. Why the Germans are so sure that they know the future is beyond me. They are fallible too, but they won’t admit it, and the Greeks can’t make them budge. Haven’t they looked around? Santorini has a different economic and social cost structure than Wiesbaden. Humanity (and common sense) seems totally lacking in the negotiations with the Greeks and a violent backlash would be totally understandable. Why the countries that have been fattening up their current account surpluses selling products to Greeks, whom they should have known were basically broke – just as they always have been – should be paid 100% on the euro is beyond me. Major losses should apply not only to sovereign borrowings but also to accounts receivable for cars, electronics, and other consumer goods. The market has not opened its eyes to the impact this Greek unraveling will have. The Eurozone will be mortally wounded and the world will suffer a significant recession – maybe as deep as 2008. European banks will lose much of their capital base and many should be bankrupt, but just as in the Lehman aftermath, the governments will try to save the banks and the banks’ bondholders, solvent or not. As the bank appetite for Eurozone sovereign paper will be decimated, austerity will probably follow shortly, followed by deflation and uncontrollable money creation. The European recession should be one for the record books.
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March 23rd - http://hat4uk.wordpress.com/
Maybe. Got physical? we are all greek now.
This is good news. US unemployment will drop to 5%, A wall street stooge will get elected, Recession....what recession ? We are having an economic boom...
All of this in Prozac induced LA LA LAND.
“As the bank appetite for Eurozone sovereign paper will be decimated, austerity will probably follow shortly, followed by deflation and uncontrollable money creation. The European recession should be one for the record books.”
They will bail out Greece with “uncontrollable money creation” anyway!
It's more likely to follow the Lehman example - let one go down, create fear and panic and in the confusion bail out the bigger problem. Therefore, Spain and Italy will be the Citi and AIG, with Portugal and maybe Hungary as the Merrill/ Bear. It is important to remember it was the near collapse of Citi and AIG which scared the shit out of the markets, not the "Lehman moment"...
IMHO, they know they are going to have to do something massive (LTRO is not a panacea, it merely creates a centralized repo market, it does not de-risk), and they could choose to bring Greece inside the tent, but frankly, the level of BS coming from the Greek establishment has made it easy to kick them down.
My guess, they will find a way to arrange the bond swap without putting too much money down, and the banks will take it, because given the almost total collapse in Greece, a 75% haircut in order to switch from local law to London, Lux will make sense in the long run.
'The European recession should be one for the record books.' I certainly fuckin hope so, I've got rather a lot of gold and silver that I'm not expecting to go down...
Funny thing is the EUers could end the entire crisis any time they want.
Create a fiscal entity (a room w. a computer in it) and an oil import fee for the continent. Fuel imports are now priced so that gasoline is now five euros per liter. The new entity would issue new bonds to retire the 'trash'.
- Energy conservation would be imposed to cut external currency drain. Import fee would be increased as necessary to cut fuel imports in half.
- The shiny, new lender of last resort would take away the bond vigs. Greek debt would be like New York State General Obligation bonds.
Sorry, bad dream this won't happen Greece will repudiate its debts and credit will freeze across Europe despite LTRO. Germany will exit the euro or go bankrupt -- it cannot pay Greece's finance debts any more than Greece can. The euro will die and trillions of euro wealth extinguished.
All for the sacred auto manufacturers and dealers. Can't ask them to sacrifice, can we?
This sucks!!!! I just learned how to use Lehman 1.0 and now there's a new version!!!!! Damn it all to Hell!!!!!!
NO MARK TO MARKET, NO PROBLEMS.
The whole "see no evil" thing is a lot more appealing when the monkey isn't also a pilot.
"Got physical?"
I've got this video of a song by Olivia Newton-John.
http://www.youtube.com/watch?v=vWz9VN40nCA
(Warning may shock younger viewers or anyone with a sensitive disposition.)
you mean the sweaty fat guys? or the pole smokers?
Who knows, there has been so much disinformation over the last few years, I've become numb to it.
Leaking a "rumor" like this could be just enough to set up millions of shorts for the slaughter once again.
On the other hand, maybe it's true and we can finally reset, and my shorts will finally pay off.
But again, this is a crooked casino, full of lies and tricks.
then again, you could ignore the troll's re-post of claptrap...
Total debkaesque BS
As opposed to US mediaesque total BS.
Tyler,
John Ward is fairly reliable. If he's says he's seen this document AND got confirmation then he has.
Whether it's a contingency document or a timetable is a another matter.
I'm not aware that John Ward's source is Debka. I seriously doubt it.
The storyline here sounds correct to me: the €14.5 billion bond is due on March 20, but supposedly one can push the default by another week to March 27. Therefore the weekend starting March 23 is the optimal time to pull the plug and put in place capital controls in Greece.
The narrative on the negotiations also appears to be credibly described.
I fully expect Greece to hard default, and it not to cause a Lehman 2.0. Pain and suffering and write offs, but no systemic shock. During the Lehman times the short-term interbank funding, Tier 1 capital ratios at around 5% and overextended CDS positions at the likes of AIG were truly horrible.
I will enjoy the resulting pain nevertheless. It is good to see capitalism in action: losses for Greek investors, whether public, private, IMF or ECB.
This IFR article on the March CDS not being triggered due to 7 day grace period also makes the "The Slog" blog entry sound very credible. Some idiots are left with useless March 2012 CDS positions that cost a fortune and don't give any protection, when the March 23 default weekend comes!
http://www.ifre.com/derivatives-investors-dump-march-greek-cds-contract/20048490.article
come on even the biggest german travel agencies as TUI, etc. have negotiated contracts with all of their hotel providers that they have to accept THE new currency of Greece if it would be introduced. That was back in 2011. google for yourself.
So go figure yourself what the future "surprise" will be!
@TD
What does that mean?
Read and draw your own conclusions -
http://debka.com/
just because Debka's conspiracy theories aren't nearly so diabolical as those found on ZH doesn't mean they're any less entertaining...
Tyler,
What's your grief with debka?
Ziops
So if they shut it down on March 23rd and Greece pays back NONE of their bonds...zero...nada...will the grand poo bas that rule on whether it is a default finally deem it a default?
"Oh sure you are getting none of your money back but it was voluntary. You really wanted to get nothing back."
What part of "...or they are far too concrete" by John Taylor didn't you understand?
These financial terrorists and their enablers in governments, holding the world hostage for the purposes of enriching themselves and gaining power, need to be skinned alive in front of their children on a worldwide television broadcast.
You're joking right? They own television networks across the globe.
Lehman 2 imminent; hitchcockian scenario for doom and gloom; whereas MSM sings "alles gut" in 2012 for US economy!
Who sings the true, true song of economy?
Its The ZIRP Song
Very nice. Thank you.
Greece is not Lehman
Say your mantras! *mantra mantra mantra...*
There is no inflation. Gold is not money.
There is no inflation. Gold is not money.
There is no inflation. Gold is not money.
You're right! I do feel better. ;)
everything's going according to my evil plan.
You forgot your evil laugh. This is very important in these matters.
Do you start the monologue with the evil laugh or end it? I get the timing of the pinky to the lips thing, but I always get confused and a bit self conscious about the laugh part.
Peter Schiff was accurate in calling the housing bubble pop and subsequent recession....has John Taylor's calls been accurate? and which calls were they and when? I have not followed Taylor.
All I could find is this, but my Google fu is weak.
http://marketswiki.com/mwiki/John_R._Taylor,_Jr.
Schiff is a tiny pimple on Taylor's ass.
Taylor called the equity market top in May 2011 very accurately.
http://www.bloomberg.com/news/2011-05-12/currency-hedge-fund-manager-tay...
The EU says 'If it is written in an agreement, then it must be followed'....WELL except for our own EU charter...but nevermind all that hey China can we haz a few trill?
but the Bank of England vetoed a sale to Barclays and the US government refused to lend any support to Bank of America in its effort to buy Lehman.
NOT TRUE ! The Bank of England had nothing to do with it as Regulation of Banks was in the hands of the FSA following changes in 1998. Geithber and Cox were too busy in New York to bother telling London what was going on and failed to involve the Financial Services Authority in discussions which meant they could not advise on UK Company Law or EU Law. So Barclays needed 60 days to arrange a Shareholder Vote to approve a takeover as it involved >5% Barclays share capital and in those 60 days someone had to guarantee Lehman trades plus which the Clearing House in London was due a software upgrade that same weekend and HBOS was failing.
The Masters of the Universe like Paulson seem remarkably ignorant about other jurisdictions and laws, even the Lehman Bankruptcy was bungled with Cox ORDERING a US Company to file bankruptcy yet failing to take account of English Bankruptcy Law where the trades were taking place and stripping out all the Cash from the London operations on a Friday for window-dressing in new York so there were no cash reserves in London to meet trades or payroll which by definition is Bankruptcy and that means shutdown.
Coming so soon after Paulson had wiped out Shareholders in Fannie Mae and Freddie Mac one wonders how this Goldman Strategy of "Fuck Your Client" ever got into the US Treasury
Oh and btw, Ken Lewis had the Feds lean on the Federal Reserve Bank of Richmond with regard to B of A's rather poor ratios as a quid pro quo for paying $29/share for a dog and guaranteeing $5.8 billion in bonuses
"The Masters of the Universe like Paulson seem remarkably ignorant about other jurisdictions and laws."
Why pay attention to something as trivial as "laws," which you've spent your life ignoring and consider applicable only to the hoi polloi. Paulson was and is a criminal and a traitor to the American Republic and its People. The criminal mind is blind to such considerations.
Yeah, saying that TPTB even consider laws and jurisdictions is the very definition of naive. Jon Corzine stole 750 million from his clients and is still vacationing in the Hamptons and dining in 5 star restaurants. I don't think he thought for one moment that he was going to jail over it.
The long rumored financial apocalypse is a perennial no show. I'll guess we'll see soon.
Thats true, 2008 economic implosion was also a ridiculous no-show, confined to subprime, nothing to see here move along and just keep buying stocks we got this shit...till 1 morning we had a nice -800 point open.
OH yea and also the exact same maniacs who saw nothing coming last time are still in charge of it all today. Cheers!
It's good to know there is an experienced hand guiding the ship.
Exxon Valdez.
No. The Costa Concordia. TPTB will leave the sinking vessel and let the passengers fend for themselves.
Well-played. :)
More like the Patna. No one is chasing some Moldovan tail, it's deliberate.
Ned is correct however in that the Greek-initiated apocalpyse has been breathlessly predicted for years now. Every time one of the artificial "deadlines" comes up, it's going to be the one that starts the dominoes tumbling. Only, the deadline comes and goes and nothing happens. Forgive me if I don't get my panties in a bunch over March 20.
Econoapocolypse nears.
The realization of all of our fears.
When currencies crash,
Global powers will clash.
To those you are close to, hold dear.
Step 1 Steal everything you can
Step 2 Marginalize problem
Step 3 Complete failure
Well, the first 2 steps are over.
Evidently, Europe did not read Tyler's Subordination 101.
Imminence Front
The sun shines... and people forget.
https://www.youtube.com/watch?v=07hoKUrMT5A&feature=related
What about this?
GREEK DEFAULT EXCLUSIVE: SENIOR US BANKERS GIVEN EXPLICIT TIMETABLE FOR ATHENS DEFAULThttp://hat4uk.wordpress.com/2012/02/16/greek-default-exclusive-senior-us...
I was just about to post that.
Interesting story...massive story if true. It fits with what I always believed that any default would be announced after market close on a Friday.
I guess we'll know if it's true or not soon enough.
March 23....(cue Jaws theme music)
Posted above. But yea, wtf I dont even doubt it at all.
I'll be convinced if anybody can find and post here, somewhere that I can bet on this.
If anybody had to predict it, it would surely be a Friday and close to the 20th March deadline anyway?
edit: Can anybody else remember reading here, months ago, that Germany was printing Deutsche Marks?
http://www.zerohedge.com/contributed/germany-already-printing-money%E2%80%A6-deutsche-marks
Let the Greeks default, there'll be a dip in the market for awhile but no Lehman event. Argentina and Mexico didn't cause a global panic following their defaults. Best thing for the ECB to do is print print print, stop the Troika from demanding incredibly harsh austerity measures on Greece which is only crippling the population. Either throw them some cash without too many strings, or let them out of the Euro fantasy and back on the Drachmas.
Ummm...you think the US is in the same position it was for Argentina and Mexico? LOL
Do you work for the ISDA?
Always risk for contagion, so the shock might not come from Greece, but if Spain or Italy follows all bets are off. And I would love to be able to pick up some swaps, unfortunately I'm not a big ole hedge fund with deep pockets. I'm not sure how much investment the US has to Greece directly, indirectly to some of its European lenders yeah. I'm sure the US had more direct investments with Mexico and Argentina back in those days than it has with Greece now.
HELLO?! One word: derivatives
I would like to know what the unprecedented volume in TVIX may signify. Have the machines simply advanced their front of consumption into TVIX or is it something more. It is not like there is a tremendous price change to match the nearly double the amount of float changing hands on a daily basis. I've never seen anything like it.
I don't really get your post, my fault. I',m nervous about the volume, i have a vxx option...
GL/
The volume in TVIX is 1.5 x any historical daily volume and that is unprecedented. So unless the amount of shares available for trading increased the stock is churning like never before. Something is causing that. What is it?
The price is acting completely normal.
Looks to me like TVIX has become a HFT favorite.
thanks. i guess i'll be holding it for a while or sell half , to get my original capital.
ETF's don't have float stupid. But volume is up as much as 4 to 1 over average. And, the price is tied to the volatility index. So the volume could mean massive accumulation ahead of an expected rise in volatility.
Conclusion on what little I have to draw on: Massive accumulation since demand is more likely to show up in a historical record high volume than the increase in volume being the result of an attack from HFT machines.
Maybe someone knows something ahead of time?
Dont worry, we got a slight beat in housing data this morning.
slight beat on cpi as well...
Moral Haphazard.
The Working Class will always be forced to bailout the Rich. The Money Counters live in Jubilee Forever Land .
Priced in Johnny!
What does this all have to do with LINSANITY?
Greek default = Lehmans x 10
I think a random dude off the street could tell you this at this point.
But, but, but guess what?
PRICED IN RIGHT.
Every single day I live knowing this is coming and it sucks.
Confined to 'Priced-In' I'm sure.
'The world is as blasé about a Greek default or departure from the euro as it can be – credit spreads are dropping, the other weak Eurozone sovereigns are financing themselves easily, and everyone thinks the LTRO has solved the problem for the next year or two.'
Blasé reporting is a media strategy for stemming panic. It's akin to: If I repeat it enough it must be true.
This is still about the banks, mostly French but also German and general 'contagion'. Had we had this four years ago we'd be in much more clear waters instead the water is murky and down below there be... dragons.
Personally im getting tired of guessing what is/not going to happen. It certainly has Iran on the backburner. For now.
I had to laugh when Italy "finally got those interest rates down to a manageable level" after raising..."a massive 4 billion." that's with a 2 TRILLION dollar debt. The fact is when all the debts of the member states were converted into "euro debt" the die was cast: "grow your economy or die."
PLEASE READ THIS - EVIDENCE OF ACTORS PLAYING ROLES IN FAKE TV REPORTS AND FAKE LEADERS (FAKES INCLUDE ADOLF HITLER, JANET NAPOLITANO, DAVID ICKE, RICHARD BRANSON, AMY WINEHOUSE, LADY GAGA, JULIAN ASSANGE, presidential candidate GARY JOHNSON, RICK PERRY, KEYSEY GRAMMER, GLENN BECK, various witnesses of 9/11, G20, OWS).
The site www.wellaware1.com is the diligent work of Ed Chiarini, and describes the use of actors in falsified MSM reports of various shootings (Fort Hood, Columbine, and others), incidents such as Gabrielle Giffords, Virginia Tech, child abductions, and the use of actors in various political positions, including fake senators in the US. Also the use of actors in other positions of prominent leadership.
FOR EXAMPLE
Adolf Hitler was not a real person; he was played by Walt Disney, a member of one of the 13 bloodlines families, d'Isigny, who came to the US from France. Disney is a satanist organisation who made propaganda movies for the US during WW2, and who is a big player in mind control today.
Janet Napolitano is not a real person; she is actually Leslie Cagan, a writer and activist from jewish communist family; has worked with black panther party, her partner is to Melanie Kay / Kanterwitz, founder of jews for radical and economic justice (www.jfrej.org), and a devoted campaigner for Jewish Women's rights and anti-defamation of Jews (her website is www.diasporism.net; 'diaspora' means the seeding of scattered colonies of Jews throughout the world). However, the character is Melanie Kay / Kantrowitz is played by Bea Winkler, sister of Henry Winkler (The Fonz!).
The character, Bradley Manning (a US army private who supposedly leaked classified documents to Wikileaks), is fictitious, and the actor who plays him (Joshua Federici) was seen recently at an OWS protest. Bradley Manning is represented by the fake lawyer, Judy Clarke, who also represented Susan Smith (also fake). Judy Clarke is played by Lisa Fithian, who was photographed with the activist character, Abbie Hoffmann in the 1970s (played by Paul Michael Glaser, see below). Lisa Fithian has also played several other characters. The whistleblower of Bradley Manning is also played by an actor and is fake.
Julian Assange is a successful actor called Julian Sands who has starred in various movies; he also plays the Norway Bomber.
JonBenet Ramsay (who was supposedly killed in 1996, and whose body disappeared) is actually Lady Gaga. Also Lady Gaga played the character Amy Winehouse, until this character 'died' recently. Multiple actors played attorneys, the parents, investigators,
The recent raid on an organic farm in Nevada was entirely fake and played by various actors, many of whom turn up in other fake news reports. This organic farm raid was aired on Infowars with Alex Jones.
One human being plays both characters, David Icke and Sir Richard Branson.
The character Benjamin Fulford is played by an actor who is a member of the Independent Film Associaton of Southern Arizona (IFASA), called Lawrence J Fuller.
Paul Michael Glaser (Starsky!) played 1970s activist Abbie Hoffmann as part of the 1970s Chicago 7 demonstrations, of which many TV reports were made, but these were fake.
Elizabeth Glaser (Paul's 'wife') was played by Bea Winkler, sister of Henry Winkler (The Fonz). Paul and Elizabeth Glaser had 2 children who supposedly died of congenital AIDS since Elizabeth supposedly contracted HIV via a blood transfusion during her first pregnancy. After the children's death, Paul and Elizabeth started the 'Elizabeth Glaser pediatric AIDS Foundation', who purpose was promotion of global healthcare with a big focus on AIDS in Africa. Bea Winkler plays the character of Dr Anja Giphart who is on the management team of the Elizabeth Glaser paediatric AIDS Foundation.
The character of Joran van der sloot (killer) who was supposed to have killed Natalie Holloway in Aruba, was played by actor, Steve-O whose father is president of Pepsico, South America.
Disclosure (of UFOs) Project is totally fake, with many actors involved.
Many of these actors are members of the Strong, Greenberg and Rockefeller elite families. (eg. Maurice Strong, inventor of the Carbon Tax), and may of these actors are actually from Canada. Even children of these families are used to play roles in many fake TV news reports and shows in the USA.
www.wellaware1.com by Ed Chiarini, the DallasGoldBug
Site is a little slow, but worth the wait.
DallasButtPlug is a fake himself dude.
No, this is DallasGoldBug. There is also DallasButtPlug.
Before trashing this, just check out 4 things which are easily verifiable -
1. David Icke & Richard Branson are the same guy (I mean we all know David Icke is an idiot, with his reptilians, etc)
2. Hitler is Walt Disney
3. Julian Assnage is the actor Julian Sands (It has independently been suggested that Assange is fake - http://thedailybell.com/bellinclude.cfm?id=2624)
4. Janet Napolitano is the Jewish Communist, Leslie Cagan.
And, after you have said bullshit to these, then trash it.
DON'T YOU BELIEVE THE USA HAS BEEN HIJACKED? SO, HOW WAS THIS DONE AND HOW IS IT BEING DONE?
Hilary Clinton's legs are played by my Steinway piano's legs.
Julian Assange is the Warlock. you have to get some nails and stick them in his footprints.
Wait, there's more:
Janet Napolitano is actually the actress Mindy Kohn, you know the token big gal from Facts of Life. She lost weight and faked her death as Dana Plato in the 90's, then assumed her new role in politics.
You eat the cake and eat the pie and now you know the reason why your fat for life.
No doubt the US and the world have been hijacked (well, hijacking implies taking something that is not yours), but the answer is probably much more simple.
One might look a little more deeply at the three eternal questions that we all should be asking ourselves:
- Who am I?
- Where am I?
- Why am I here?
... and no, I do not have the ultimate answers to the ultimate questions ... and my guess is that neither do "they". "They" have simply had access to the records from their own history and those that were destroyed/hoarded over time in places such as the Library of Alexandria, Ancient India, China and the Maya (and other similar cultures).... and were thought to have been destroyed in Ancient Sumer, but some actually survived.
History Rhymes ...
... but does anyone in this, "NBA digging/Dancing with the Stars watching/Amped on fiat", world care?
Maybe ...
Answer is 42 dude. Old news.
i reckon all junks to 0 paints the true picture of your post Rodo...
Good job Rodolfito.
We're all counting on you, we know you won't let us down.
We expect to hear again from you in, oh..... let's say October.
Remember, you're doing god's work.