Is Mario Draghi Lying Again?

Tyler Durden's picture


The last time Mario Draghi made an unequivocal statement regarding his actions under exceptional circumstances, we pointed out the unthruthiness of his comment that LTRO borrowing in no way stigmatized a bank. That did not end so well for the LTRO banks. Today's ECB press conference perhaps sets him up for another banana-skin down the road. From the 20 minute segment, the ECB head describes the lowering of eligibility standards for ECB collateral to include assets that banks take as collateral in the real economy ("credit claims and ABS of lower rating", i.e. rusty old cars, empty coffee-shops, unkempt holiday homes). His description of the hypothecated-hell: "It's very useful [for the banks] to lend to the real economy; as the banks generate collateral that they can now use for funding themselves" - which sounds awfully like a ponzi scheme - is nothing less than a massive on-boarding of all European asset risk by the ECB (using the banks as a simple pass-thru). This would seem to dramatically lower the quality of the ECB balance sheet. But have no fear, for as the new maestro puts it "we want to do this in a way to keep the risks of the ECB balance sheet very very low". Low indeed.

His commentary on the lending to SMEs and the broadening of ECB collateral eligibility starts at around 20:00...



All this comes down to is simply enabling 'some' credit to flow to the banks to cover funding holes from deposit flight (and ECB margin calls) and perhaps confirms our view that a Senior-Sub decompression trade remains worthwhile as more and more of European bank balance sheets become encumbered. Also worthy of mention is this is an implicitly inflationary action so perhaps could help gold in its leaking effect into the real economy - though we suspect this is less so.

Monitoring the levels of this line item of collateral in the ECB balance sheet is critical.

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Thu, 07/05/2012 - 20:09 | 2590580 Hedgetard55
Hedgetard55's picture

So, the prick is a pathological liar, what's new? Eurozone shithouse is going to collapse no matter what any human being says or does.

Thu, 07/05/2012 - 20:37 | 2590630 Aziz
Aziz's picture

What's new?

His nickname.


Thu, 07/05/2012 - 21:41 | 2590724 Stoploss
Stoploss's picture

Can WB7 at least put a fucking axe through that part in his hair?

The incessant exponential power steps of retardation are beginning to wear...

Thu, 07/05/2012 - 20:39 | 2590633 BarreraNorman70
BarreraNorman70's picture

A friend's mother makes $84 hourly on the computer. She has been out of a job for 7 months but last month her pay check was $18729 just working on the computer for a few hours. Read more here www.GoogleAdsCash.Com

Thu, 07/05/2012 - 21:24 | 2590693 akak
akak's picture

Your friend's mother gave my friend's father crabs and the clap.

Thu, 07/05/2012 - 21:34 | 2590708 HardwoodAg
HardwoodAg's picture

Tell your friend's mother to eat shit and die

Thu, 07/05/2012 - 20:09 | 2590581 DoChenRollingBearing
DoChenRollingBearing's picture

He is an ex-Golman Sachs bankster!  Of course he's lying!

So much lying, so much stealing...

Thu, 07/05/2012 - 20:40 | 2590635 Not Too Important
Not Too Important's picture

No, not ex-. He's Former Goldman-Sachs. There's a difference.  Ex- means he's not going back, kind of like an ex-wife (well, I wouldn't).

'Former' means he's still attached. Any US Marine can explain the difference. And they'll beat you if you push it. Fair dinkum.

Thu, 07/05/2012 - 21:40 | 2590721 DoChenRollingBearing
DoChenRollingBearing's picture

Thanks for the tip!  I'll be careful about talking about ex-es when Marines are around...

Thu, 07/05/2012 - 21:14 | 2590676 knukles
knukles's picture few muppets

Thu, 07/05/2012 - 20:09 | 2590582 Hondo
Hondo's picture

You just read that and say "WTF".....Ponzi is right...corrupt 

Thu, 07/05/2012 - 20:15 | 2590593 Bill D. Cat
Bill D. Cat's picture

Why in the fuck would any bank in the world lend to any one , thing , or business ?

Thu, 07/05/2012 - 20:17 | 2590596 Racer
Racer's picture

If you have money in a bank account... GTFO

Thu, 07/05/2012 - 20:22 | 2590605 vast-dom
vast-dom's picture

sheer insanity! allow me to take a hot steamy nutty shit that i may lend out and create uh......a few trillion euros! this is not even amusing. why interview this clown? why even watch him? he is a dried out turd pathological liar.

Thu, 07/05/2012 - 20:25 | 2590611 catch edge ghost
catch edge ghost's picture

Nope. He isn't - sort of.
They'll eventually be forced to start trading these 'bonds' at garage sales and flea markets. That will be a plus for the real economy - sort of.

Throw in the (spiderman) towel, Mario, and you got a deal!

Thu, 07/05/2012 - 21:13 | 2590675 knukles
knukles's picture

Some day this shit will be collectable.

Thu, 07/05/2012 - 20:33 | 2590622 taniquetil
taniquetil's picture


Thu, 07/05/2012 - 20:45 | 2590623 EvlTheCat
EvlTheCat's picture

"It's very useful [for the banks] to lend to the real economy; as the banks generate collateral that they can now use for funding themselves."


It's very useful [for the banks] to lend debased colorful paper to the "real economy"; as the banks can entrap more debt slaves so they can now perpetrate even higher stakes gambling crimes.

I suggest following this link to gamblers anonymous Draghi

EDIT:  Can the terminally insane ever know when they are telling the truth or lying?  From my understanding they only care that the ends justify the means.

"The first sign of corruption in a society that is still alive is that the end justifies the means."

Georges Bernanos, The Last Essays of Georges Bernanos (1955), "Why Freedom?"

Thu, 07/05/2012 - 21:05 | 2590660 vast-dom
vast-dom's picture

"EDIT:  Can the terminally insane ever know when they are telling the truth or lying?  From my understanding they only care that the ends justify the means." I used to know one of these and she funny enough was in a 12 step program -- she would twist anything to justify her insane needs. Very sick vampiric presence! BPD and deranged. STAY AWAY!

And yet this dangerous sociopath head of ECB is in a position of power such that he meddles with global institutions etc etc etc 

Thu, 07/05/2012 - 20:41 | 2590636 Not Too Important
Not Too Important's picture

Are his lips moving? Yep.

Fri, 07/06/2012 - 10:19 | 2591726 Manthong
Manthong's picture

I purposefully withheld posting my first reaction before scanning down the comments because I knew damn well that exact thought had to be someone else’s first impression, too.  : D

Thu, 07/05/2012 - 20:54 | 2590642 AUD
AUD's picture

the lowering of eligibility standards for ECB collateral to include assets that banks take as collateral in the real economy ("credit claims and ABS of lower rating", i.e. rusty old cars, empty coffee-shops, unkempt holiday homes).

There is nothing new in a progressive currency inflation, the ideal of which is to
"escape the impending depreciation of liquid funds".

In 1923, the Germans called it Substanzwerte, meaning everything from undeveloped real estate to empty matchboxes.   Melchior Palyi, 1936

Thu, 07/05/2012 - 23:42 | 2590898 SAT 800
SAT 800's picture

Good reminder; there is a known direction in which this is heading. My first reaction to reading it was to laugh out loud.

Thu, 07/05/2012 - 21:03 | 2590662 101 years and c...
101 years and counting's picture

"Is Mario Draghi Lying Again?"

Rhetorical question, i presume.

Thu, 07/05/2012 - 21:11 | 2590671 knukles
knukles's picture

Looka herea
Disssabe dah way it a be ah done a

You a gimme your Angeline.  When I be done with a her I give a her to Luigi and a when a he a done a with her, he a give a her to Pinochio.  Piniocho, he lika da leetile boys a lots so he trade a her for the little bambini whosa abeen a Bunga Bunga with ada Silvio walllah he grabba hees a crotche and a yell "Yo Angeline!"

Whassa matta witha a dat a uh?

Ess a da new programma the ECBBB
The ECB Bunga Bunga Collateral Managemant Exchange and Dinky Diddle.

You no lika dat ahuh?
You should a see what a da Greeks a do with a dere donuts in a dah morning.  Dats a why they gots a dah holes.
We no gots a dah holes in our a donuts, our be a dah creme a filled a canollis.  Where a you think a dah stuffing a come a from?  And  a den we pass along a da creme a to Angeline.  And a everybody gets a paid a back.

Don a tella da French.

They get a upa seta


Thu, 07/05/2012 - 21:15 | 2590679 holdbuysell
holdbuysell's picture

There are a boatload of landfills out there. Go nuts.


Thu, 07/05/2012 - 21:47 | 2590734 GlassSteagall
GlassSteagall's picture

Is Mario Draghi Lying Again? ....  When did he get annointed? ... yeah, since then

Thu, 07/05/2012 - 22:12 | 2590770 butchee
butchee's picture

When it gets serious you have to lie.....EU credo

ESM stands for Extremely Schizophrenic Mendacity.

Thu, 07/05/2012 - 22:38 | 2590814 tmosley
tmosley's picture

At what point did you think he wasn't lying?

Thu, 07/05/2012 - 23:02 | 2590843 samttmfw
samttmfw's picture

Just shocking! haha

Thu, 07/05/2012 - 23:34 | 2590884 q99x2
q99x2's picture

Of course he is lying otherwise he wouldn't have the position that he does.

Thu, 07/05/2012 - 23:43 | 2590899 world_debt_slave
world_debt_slave's picture

Is that a rhetorical question?

Fri, 07/06/2012 - 01:47 | 2590994 kikkoman
kikkoman's picture

He even lies when he just asks a question.

Fri, 07/06/2012 - 00:08 | 2590926 zebra
zebra's picture

for these banksters, lying is their baseline, telling truth is out of ordinary.

Fri, 07/06/2012 - 01:02 | 2590970 akak
akak's picture


for these banksters, lying is their vaseline

Had to correct you there.


Fri, 07/06/2012 - 01:51 | 2590997 northwind
northwind's picture

he might think it's actually true so then is he still lying? these guy could be so delusional they think it's true. just wondering.

Fri, 07/06/2012 - 02:31 | 2591019 Clashfan
Clashfan's picture

Draghi should do an interview with this armed and better equipped Bloomberg reporter. Is the crew playing games so that they can increase their audience? Is the mainstream, financial media this desperate? Or are they just... what? What kind of news team does stuff like this?

The camera crew catches this reporter playing with her strapon and puts her on the spot. Watch her face. Cover your keyboard before watching. ;)

Wow! Really? Wow! It's a party up in there, yo.

Fri, 07/06/2012 - 04:12 | 2591069 Reptil
Reptil's picture

pimps to my right and whores to my left

Fri, 07/06/2012 - 03:56 | 2591060 dcb
dcb's picture

1) the man rose to the heights of goldman sachs, so therefore he must be a liar. there are certain traits one mst have to get there and one should always consider this in their analysis.

2) the people who put him there know this, so there are certain things to be expected.

I have said, and I continue to say that the entire time the plan has always been to load up the ecb with all the bad crap from the financial system. then you aren't bailing out the financial system, or countries. then when push comes to shove the banker class will force a bailout of the ecb. this is the most clever form to risk transfer from the banker to the taxpayer is is the least likley to see civilian fall out.

you don't put a goldman guy there if you expect rules to be followed and dirty tricks not to be used. That' why you put them there. plus you know they will keep their mouth shut and there really won't be a paper trail of the behavior or real reasons for doing it.

Fri, 07/06/2012 - 04:06 | 2591066 Reptil
Reptil's picture

What a strange question!


Fri, 07/06/2012 - 04:17 | 2591073 johnnyarrowmaker
johnnyarrowmaker's picture

Is Nario lying? Easy to tell, is his mouth open?

Fri, 07/06/2012 - 05:25 | 2591103 elwu
elwu's picture

"Is Mario Draghi Lying Again?"

Come on, this is a Goldman Sachs guy, what do you expect?



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