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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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.

Aziz's picture

What's new?

His nickname.


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...

BarreraNorman70's picture

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akak's picture

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

HardwoodAg's picture

Tell your friend's mother to eat shit and die

DoChenRollingBearing's picture

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

So much lying, so much stealing...

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.

DoChenRollingBearing's picture

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

Hondo's picture

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

Bill D. Cat's picture

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

Racer's picture

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

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.

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!

knukles's picture

Some day this shit will be collectable.

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?"

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 

Not Too Important's picture

Are his lips moving? Yep.

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

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

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.

101 years and counting's picture

"Is Mario Draghi Lying Again?"

Rhetorical question, i presume.

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


holdbuysell's picture

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


GlassSteagall's picture

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

butchee's picture

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

ESM stands for Extremely Schizophrenic Mendacity.

tmosley's picture

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

samttmfw's picture

Just shocking! haha

q99x2's picture

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

world_debt_slave's picture

Is that a rhetorical question?

kikkoman's picture

He even lies when he just asks a question.

zebra's picture

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

akak's picture


for these banksters, lying is their vaseline

Had to correct you there.


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.

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.

Reptil's picture

pimps to my right and whores to my left

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.

Reptil's picture

What a strange question!


johnnyarrowmaker's picture

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

elwu's picture

"Is Mario Draghi Lying Again?"

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