Mark Grant And Rick Santelli On Europe: "It's A Ponzi Scheme To Be Honest With You"

Tyler Durden's picture


As Simon Hobbs noted this morning, Olli Rehn confirmed ahh that err "both the European Union and the ECB are ready to take action" but only conditional upon requests for aid. What is perhaps missed by most observers is what Rick Santelli and Mark Grant discuss in more detail in the short clip below. Greece managed to sell EUR4 billion short-dated bills this morning at remarkably low yields - not exactly the kind of thing that incentivizes political leaders to request aid - but how did they do it? Who bought it? Well, we suspect you know the answer but Mark Grant's clarifying response to Santelli's question concluded simply that the ECB-to-Greek-Banks-to-The-Bank-Of Greece-to-ECB circle-jerk is "in a sense, a kind of Ponzi scheme." Santelli's response that "it really is a rigged game" and that our reflexive response to the signaling of bond yields is remarkable given the manipulation; Grant agrees adding that "the real money guys are either out of Europe, getting out of Europe, or have cut back as much as they can" since simple math shows you that at some point Europe will have it's 'moment'.


Hobbs introduces, discusses Greece at around 3:00 and then Santelli and Grant take over at 3:40...

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Tue, 08/14/2012 - 12:36 | 2704074 vinu02
vinu02's picture

I wished governmet thinks about bailing out their citizen someday. I m tried of hearing bank getting bailout or country.

Tue, 08/14/2012 - 12:43 | 2704099 MillionDollarBonus_
MillionDollarBonus_'s picture

Peripheral debt is a screaming buy right now. The ECB and European commission are battle hardened and stand ready to take the necessary steps to promote economic stability. Only a fool would ignore these mouth watering double digit yields and pass up the investment opportunity of a lifetime.

Tue, 08/14/2012 - 12:49 | 2704113 No Euros please...
No Euros please we're British's picture

Alas, MDB, my worst fears are confirmed. You truly are a troll of the 1st order. Either that or a complete fool.

Tue, 08/14/2012 - 12:51 | 2704129 Roger O. Thornhill
Roger O. Thornhill's picture

MDB is just a gag- mocking the kool-aid drinkers and pollyannas - he probably laughs everytime he posts his nonsense.

As to this whole situation... it is the craziest thing I've seen in my lifetime. The whole thing really is a CONfidence scheme at this point. And how long until the marks get fleeced? Hard to say. Like musical chairs, no one knows it's over until the music stops - the question then is the ratio of players to chairs.


Tue, 08/14/2012 - 12:57 | 2704145 insanelysane
insanelysane's picture

We'll wake up one of these mornings and the European markets will all be closed.

Tue, 08/14/2012 - 13:15 | 2704215 Nage42
Nage42's picture

Well duh, it happens every year for the month of August, it's called "summer break" for the French.

I poiniently remember a coworker (French) who was explaining teary-eyed that he couldn't believe the level of slavery his employer held him to and that he "only" had 3-contiguous weeks of holiday in August, and had to reserve his remaining 10 days for the Christmas holiday... he was going on like it was the end of the world... that people would be so hard-put upon that they had to suffer with so little as 3-solid weeks of paid vacation with only 1 week in reserve for the winter.

peak oil ain't got nothing on "European peak piss-take {tm}."


Tue, 08/14/2012 - 13:28 | 2704288 Stackers
Stackers's picture

If a person did what they just described they would be prosecuted for a crime known as Check Floating. where you write checks to yourself to clear other checks, with none of the checks actually being good.

Tue, 08/14/2012 - 12:59 | 2704153 kliguy38
kliguy38's picture

just a computation for maximum damage remaining

Tue, 08/14/2012 - 13:17 | 2704223 SmallerGovNow2
Tue, 08/14/2012 - 12:56 | 2704142 A Lunatic
A Lunatic's picture

I wish those were my worst fears................

Tue, 08/14/2012 - 13:08 | 2704185 PiratePawpaw
PiratePawpaw's picture

Or perhaps there is a third option.

Perhaps he is employing sarcasm and acting as a straight man/devil's advocate.

Perhaps not, but that is how I choose to take him.

On a related note: the comment above about bailing out the citizen makes me think of the anonymous chinese citizenism citizen guy. An alt maybe?

Tue, 08/14/2012 - 12:47 | 2704114 tocointhephrase
tocointhephrase's picture

A bit like your advise to buy Facebook on the IPO? FOLLOW HIS ADVISE AT YOUR OWN RISK!!!

Tue, 08/14/2012 - 13:19 | 2704236 SmallerGovNow2
SmallerGovNow2's picture

AKA Farcebook...  or part II...

Tue, 08/14/2012 - 12:47 | 2704115 azzhatter
azzhatter's picture

MDB, you're barely trying anymore

Tue, 08/14/2012 - 12:51 | 2704127 francis_sawyer
francis_sawyer's picture


So with all your "gems" of recommendations of opportunities of a lifetime, when are you going to change your name to MillionDollarBAILOUT?

Tue, 08/14/2012 - 12:51 | 2704131 tocointhephrase
tocointhephrase's picture


Tue, 08/14/2012 - 12:52 | 2704132 Dr. Engali
Dr. Engali's picture

There are plenty of fools who get their investment advice from CNBC. I'm sure they will be glad to jump on the chance.

Tue, 08/14/2012 - 14:55 | 2704623 NidStyles
NidStyles's picture

It's called "the greater fool" for a reason.

Tue, 08/14/2012 - 12:58 | 2704146 kliguy38
kliguy38's picture

COUNT ME IN!!  I'll be behind you every step of the way .......... Bill Murray (Stripes)

Tue, 08/14/2012 - 13:01 | 2704161 LongSoupLine
LongSoupLine's picture

didn't you say the Facebook IPO was the "opportunity of a lifetime" too? 



Tue, 08/14/2012 - 13:02 | 2704162 Gringo Viejo
Gringo Viejo's picture

MDB....I'v got a double digit yield that'll make your mouth water. Whose your daddy?

Tue, 08/14/2012 - 14:55 | 2704625 NidStyles
NidStyles's picture

It is spellt "Who's". 

Tue, 08/14/2012 - 13:03 | 2704164 WhiteNight123129
WhiteNight123129's picture

 This time around MDB you disappoint me, look at Irish 10 Years, they trade inside Italy, while they were at 50 cents on the dollar last year. Ireland manufacturing to GDP is 22%, higher than Germany, so clearly it is a special case, maybe the only case of periphery where so far austerity seems to have been rewarded. There is no other way than pain, government shrinking expenditures, maintaining this tense situation for as long as necessary to keep the pressure on government to cut spending. Coene from ECB had a statement saying that it would serve no purpose to buy Italian and Spanish bonds if those government do not inflict more pain in the short term that is shrink the government expenditures to give some relief long term to the private sector. You can do better than that MDB, it is a temporary moment of fatigue I suppose. WHere is the surrealist poet in MDB today, is he on vacations?


Tue, 08/14/2012 - 13:09 | 2704188 prains
prains's picture


have you doubled down on face plant yet? or doubled over for the upcoming reaming?

Tue, 08/14/2012 - 13:27 | 2704274 Vincent Vega
Vincent Vega's picture

Last time I heard somebody use the phrase 'only a fool...' was when a friend of mine was telling me how much MCI-Worldcom stock she owned. I advised her to sell a substantial portion of it (at least enough to pay off her house and go ahead and fund the kids college). She replied 'only a fool would ever sell their Worldcom stock.'   just sayin' 

Tue, 08/14/2012 - 13:37 | 2704322 Anglo Hondo
Anglo Hondo's picture

MCI-WorldCom died a few months before my employee stock options matured. Only a quarter mill down the drain.  At least Bernie Ebbers is still in lockup - I hope.


Tue, 08/14/2012 - 13:52 | 2704375 Vincent Vega
Vincent Vega's picture

My friend worked there too. She lost about 800k. Sorry to hear about your deal. Pretty sure Bernie is still in lockup.

Tue, 08/14/2012 - 13:31 | 2704298 Q.E.easy
Q.E.easy's picture

+1 for being one of ZH's best trolls yet.... I can't believe theres still guys here who think your serious.

Couple months ago I thought you were slipping.... and then you go and deliver in spades!

Tue, 08/14/2012 - 14:18 | 2704483 monopoly
monopoly's picture

I wonder, is MDB related to Robot Trader?

Tue, 08/14/2012 - 16:05 | 2704892 Lucius Corneliu...
Lucius Cornelius Sulla's picture

And if you didn't spend your wad on all of that Greek debt that was a "screaming buy" you might have some left to buy more!

Tue, 08/14/2012 - 18:45 | 2705234 boogerbently
boogerbently's picture

Where's the "<sarc>" sign ??

Tue, 08/14/2012 - 12:36 | 2704079 SaveTheGreenback
SaveTheGreenback's picture

Santelli for Mayor of NYC!!

Tue, 08/14/2012 - 12:58 | 2704151 insanelysane
insanelysane's picture

What do you have against Santelli???

Tue, 08/14/2012 - 13:35 | 2704311 SaveTheGreenback
SaveTheGreenback's picture

Nothing!   He is the man.

Tue, 08/14/2012 - 12:36 | 2704080 Yen Cross
Yen Cross's picture

Lets also toss Italy and Spain in the three ring circus.

Tue, 08/14/2012 - 12:40 | 2704094 buzzsaw99
buzzsaw99's picture

either the ecb or fidelity bought them

Tue, 08/14/2012 - 12:52 | 2704097 TruthInSunshine
TruthInSunshine's picture

Steps in Ponzi Scheme using Fractional Reserve Model:



1)  Lend fiat (where did it come from? how was it created? it magically appeared) to club members at 0.25% interest.

2)  Incentivize club members to buy treasuries yielding greater than 0.25% interest.

3)  Buy treasuries from club members and pay them a commission for the privilege of selling that which has already been profitable (due to massive, radical, central fractional reserve bank QEeesing and Twisting).

4)  Incentivize club members to invest fiat received in exchange for sale of treasuries into equities, other bonds and credit/debt instruments, and other assets they would ordinarily not buy without implied (or express) backstop under anything remotely resembling free market conditions.

5)  Allow club members to mark their current assets [liabilities] to unicornium levels.

6)  Crowd out private investment by non-club members, as well as completely break supply/demand curve, any ability for price discovery, and all other market functions along the way.

7) Repeat steps 1 through 6 over and over and over and over.....

Tue, 08/14/2012 - 12:57 | 2704143 francis_sawyer
francis_sawyer's picture

8) especially with regards to #6 above, create paper instruments to control the price of PM's & other critical commodities

9) Enrich executive members of 'club' with lavish bonuses so that they can systematically stockpile large quantities of the same PM's & critical commodities at firesale prices, (as well as construct personal defense bunkers) for the day when the plug is pulled on the entire operation.

Tue, 08/14/2012 - 13:04 | 2704170 LongSoupLine
LongSoupLine's picture

well done TIS


Tue, 08/14/2012 - 13:25 | 2704267 SmallerGovNow2
SmallerGovNow2's picture

Good post Truth...

Tue, 08/14/2012 - 13:28 | 2704290 yrbmegr
yrbmegr's picture

It would be much more efficient to just hand out Benjamins on the steps of the Treasury Building.  How many you want today?

Tue, 08/14/2012 - 12:44 | 2704101 ITrustMyGut
ITrustMyGut's picture



<3 it when truth leaks onto the interwebs and airwaves.. even if discarded and unseen...  it gives me a chubby

Tue, 08/14/2012 - 12:44 | 2704103 Cognitive Dissonance
Cognitive Dissonance's picture

Rick Santelli speaking truth to power. May I suggest you avoid hot tubes and light aircraft.

Just a word to the wise.

Tue, 08/14/2012 - 13:15 | 2704217 Nadaclue
Nadaclue's picture

Nah, they'll just Breitbart Rick and he'll be found face down, out of his nightly stroll. Sadly, his heart just gave out of him.

Tue, 08/14/2012 - 13:59 | 2704399 NotApplicable
NotApplicable's picture

As long as he's talking about Europe, he's fine, as it still fits into the divide and conquer theme.

If he gets too far off base, he'll be let go and wind up over at RT, where he'll be portrayed as a loon by the MSM. Once again, fitting into their divide and conquer operation.

Tue, 08/14/2012 - 12:45 | 2704107 Atomizer
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