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Market Reaction To German 'TARP' Vote

Tyler Durden's picture




 

A very small initial rally has given way to more significant selling now as credit and equity markets pull back, EUR drops, and Bunds have rallied 1-2bps. Selling the news makes some sense but is hardly confidence-inspiring...especially given sub financials (light blue) move - though we are sure we will flip-flop for another or two yet.

UPDATE: Bunds at low yields of day now

Perhaps the phrase - we're gonna need a bigger boat  - will become more popular vernacular today.

Chart: Bloomberg

 

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Thu, 09/29/2011 - 07:02 | 1721263 GeneMarchbanks
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Euro-TARP as dead as OT2...

We're gonna need more debt.

Thu, 09/29/2011 - 07:34 | 1721321 GetZeeGold
GetZeeGold's picture

 

You use the word debt like it's a bad thing.

 /sarc_off

Thu, 09/29/2011 - 08:14 | 1721431 MsCreant
MsCreant's picture


Price Stabellitee.

Humon Actevitee.

Thu, 09/29/2011 - 06:54 | 1721264 equity_momo
equity_momo's picture

We're gonna need a bigger tube of KY.

Thu, 09/29/2011 - 06:56 | 1721268 Jayda1850
Jayda1850's picture

We have the biggest boat available, its called the Titanic.

Thu, 09/29/2011 - 07:04 | 1721285 achmachat
achmachat's picture

I am relieved that you chose the boat they say even God can't sink.

Thu, 09/29/2011 - 07:11 | 1721306 Jayda1850
Jayda1850's picture

Maybe The Bismark would be more apropos.

Thu, 09/29/2011 - 07:43 | 1721358 Oh regional Indian
Oh regional Indian's picture

or perhaps the ARK? 

Noooooooooooo  Ahhhhhhhhhhhhhhhhhhhhhh........

Might as well enjoy it all eh?

Billary Caught! Now Waught?

Thu, 09/29/2011 - 07:08 | 1721293 Snidley Whipsnae
Snidley Whipsnae's picture

"its called the Titanic."

A perfect lifeboat for all TBTF azz hats and their lap dog Pols... load all fiat into the cargo holds.

Bonvoyage! 

Thu, 09/29/2011 - 07:24 | 1721328 GetZeeGold
GetZeeGold's picture

 

But...but...but....the gold lifeboat has been sinking.

Don't go near the gold lifeboat......it's sinking.

 

P.S. China says thank you.

 

Thu, 09/29/2011 - 07:52 | 1721377 Snidley Whipsnae
Snidley Whipsnae's picture

The gold lifeboat isn't sinking... It's being rocked by central banks via their bullion banks selling into the market... usually at odd hours when few bids exist for their dumping of paper gold...at a loss.

I'm still in the lifeboat and welcome the departure of those lightening the boat. As I look around I notice that the Chinese, Indians, and Mid Easteners are still rowing.

So, some fools that become nervous because the lifeboat is rocking decide to jump out of the boat and swim for a distant green island seen on the horizon.

Said island may be inhabited by head hunters and cannibals...or, perhaps it's just an island made of inedible dollars.

Thu, 09/29/2011 - 09:09 | 1721628 Captain Planet
Captain Planet's picture

Unfortunatly, all the Too Fat to Swim get lifeboats, while the rest get closed in to the hull and drown with the boat. 

If only the house plebs would make the fatsows fend for themselves. 

Thu, 09/29/2011 - 07:26 | 1721333 optimator
optimator's picture

How about the biggest boat ever made, ever.  The Mayflower!

(It must be the biggest, look at everyone's relatives that came over on it.)

"Deutschland unter alles"

Thu, 09/29/2011 - 06:58 | 1721270 wang (not verified)
wang's picture

seems the Germans continue in their all talk no action as Merkel retains support of her coalition and did not need the oppostiion to pass the legislation

http://www.reuters.com/article/2011/09/29/eurozone-merkel-vote-altmaier-...

Thu, 09/29/2011 - 07:11 | 1721300 AnAnonymous
AnAnonymous's picture

Made me laugh.

What opposition? Checking the result of the vote shows no opposition, only a few mavericks and the majority of the rest working to pretend an opposition.

US citizens are tiring as they can not provide better propaganda which has been debunked over and over again.

There is no discontinuity between a people and their government in the US style of government.

The institutions are empowered by The People. Representatives exercize institutional power.

No opposition. Only the pretense of it.

Germans do support the current string of policies.

US world order.

Thu, 09/29/2011 - 06:58 | 1721271 nmewn
nmewn's picture

So they decided to destroy the publics medium of exchange (and thus their labor) some more.

I'm shocked ;-) 

Thu, 09/29/2011 - 07:04 | 1721284 Snidley Whipsnae
Snidley Whipsnae's picture

Hugo Salinas Price is discussing events in Europe...

"Wolfgang Münchau in the FT of September 26 writes in the editorial page: “I have never seen Europe’s politicians as scared as I saw them in Washington last week”.

Europe’s politicians have good reason to be scared stiff; if the euro cracks up and the European Monetary Union collapses then the viability of the Welfare State is in question. Without the perpetual deficits that the Welfare State entails, how will it be possible to maintain the populations of Europe in their illusion of perpetual untrammeled bliss? If the peoples of Europe are to wake up one morning to find themselves once again in the real world, where survival means hard work and personal privations, the political upheaval will be gigantic. This is why the politicians are scared.

If the continued existence of the Welfare State is in question, then so is the Democratic State, because Democracy – or what passes for it - can only be simulated where the voting population is constantly appeased with ever greater hand-outs from the Welfare State, the Siamese twin of Democracy.

If the euro cracks up and the European Monetary Union goes the way of all fiat we can expect a political convulsion of the first order in Europe as the ingrained illusions vanish. Perhaps that would not be a bad thing. Bill Bonner has written, with his usual wry humor, “Give Collapse a Chance”."

http://www.plata.com.mx/Mplata/articulos/articlesFilt.asp?fiidarticulo=173

Thu, 09/29/2011 - 07:14 | 1721314 AnAnonymous
AnAnonymous's picture

Without the perpetual deficits that the Welfare State entails,

///////////////////////////////////////////////////////////////////////

No. Expansion is the cause of the perpetual deficits.

There were expansionists before the welfare state and they have this in common: they bid future gains against present consumption.

The upheaval is to be caused by the revelation that the good days of expansion are over for the West because no more room to expand.

Thu, 09/29/2011 - 07:36 | 1721347 Snidley Whipsnae
Snidley Whipsnae's picture

"No. Expansion is the cause of the perpetual deficits."

Expanison in the West in the last ~ 30 yrs has occured in the FIRE sector and very little elsewhere... Productivity gains have gone to the top in manufacturing and the FIRE sector...unless one counts a string of bubbles that collapsed... or edible Ipads. The US has been in a lock-down economy where, other than mom/pop start ups, real genius has been discouraged by the status quo, anti competition of multi national corps using near slave labor.

Enormous expansion could occur in the West if the nanny state were to be eliminated, sensible regulation of the FIRE sector were reinstated and enforced, and the Fed and it's TBTF banksters were to be disbanded.

You are selling short the inventiveness of the human enterpreneur when you make flat statements like 'no more expansion is possible'... No one forsaw Newton, Maxwell, Einstein, Marconi, and multitudes of less well knowns that created expansion.

To say otherwise is to mimic Francis Fukuyama and his rediculous 'End of History'...

Thu, 09/29/2011 - 08:12 | 1721427 AnAnonymous
AnAnonymous's picture

Too much to tackle.

Fukuyama? Dont know that guy. But I suspect he is a US citizen therefore a propagandist.

I strongly doubt that I share commonality with a US propagandist in regards of expansion.

Cutting down the 'nanny state' (the US has had a nanny state since inception) is just gimmick to pretend expansion.

Well know trick by expansionists. Expansionists expand onto an exterior. When the exterior is saturated, the only room left to expand is the interior.

No tremendous expansion. Only eating oneself.

Inventiveness? But inventiveness has been one of the major causes behind the current fiasco. Never been short of new ideas to consume vainly the environment etc...

Thu, 09/29/2011 - 10:35 | 1721850 BigJim
BigJim's picture

Yawn. More zero-sum economic worldview from AnAnonymous.

Thu, 09/29/2011 - 11:40 | 1722083 AnAnonymous
AnAnonymous's picture

Since when economists in this US driven world admit zero sum games?

Ah, yes, they do, just like their US citizen fellows do. When the world is supposedly bailed out of their US hard earned tax payer money or something like that...

The US is not the solution, the US is the problem.

Thu, 09/29/2011 - 08:25 | 1721459 Schmuck Raker
Schmuck Raker's picture

F.I.R.E.?

FIRE economy, a segment of the stock market: Finance, Insurance, Real Estate...TY Wikipedia.

Thu, 09/29/2011 - 09:07 | 1721615 LawsofPhysics
LawsofPhysics's picture

While I appreciate the optimism Snidley, you still need a cheap energy source that has minimal risk to drive all that "innovation" and "real genius".  It takes a tremendous amount of energy and capital to get any technology from the discovery bench to the market.  Then you must consider production and labor costs.  With the real black hole liquidity trap in place and no more cheap oil, REAL margins are compressed about as far as they will go.  I say we simply let it all crash.  At least then we find out who is really worth a shit and then maybe compensation (in whatever form that may be) will find its way back to those folks.

Thu, 09/29/2011 - 10:39 | 1721868 BigJim
BigJim's picture

Energy IS still cheap, at least relatively speaking, in historical terms of what your $ will buy energy-wise.

I have yet to see a convincing argument made that we are past the point of further economic expansion... providing, of course, we dismantle the state-imposed parasitism of our financial 'industry'

Thu, 09/29/2011 - 11:44 | 1722093 AnAnonymous
AnAnonymous's picture

What evidence?

Call of evidences by US citizens is just an opportunity for them to display their fantaisist leaning: facts are only facts when US citizens believe them to be facts.

So what?

The rise of the US was made through the rise of the State. Calling for its dismantlement as a parasitic adjunction is itself evidence of slower expansion rate.

But hey, US citizens are like that: addicted to cheap propaganda. They spurt propaganda and a few lines down, the debunking of it.

US citizens can not align two cogent ideads these days. The result of the US world order.

Thu, 09/29/2011 - 07:34 | 1721344 BigJim
BigJim's picture

Tethering Germans fiscally to Greeks is essentially the same as using taxation to redistribute value from the productive to the unproductive within a country. It's just intra-national socialism... and will have the same destructive long-term effects on both the Germans and the Greeks that socialism has on the inhabitants of any country that operates such wealth transfer schemes within its own borders.

Whether the majority of German taxpayers feel they have such a duty towards their Southern neighbours remains to be seen. Whether the German political class gives a damn about voter sentiment also remains to be seen.

Thu, 09/29/2011 - 07:49 | 1721365 youngman
youngman's picture

I wonder if many German tourists are visiting Greece now...or in the future....a good statistic to find if available.....to feel the pulse of the Germans

Thu, 09/29/2011 - 07:58 | 1721391 Snidley Whipsnae
Snidley Whipsnae's picture

"I wonder if many German tourists are visiting Greece now..."

Maybe those Germans that drive an armored Mercedes?

Brings to mind old WW2 film footage of Germans parachuting into Crete. :)

Thu, 09/29/2011 - 06:57 | 1721272 ZeroPower
ZeroPower's picture

CDS for WE sovereigns wider as well.

Thu, 09/29/2011 - 06:58 | 1721273 Fips_OnTheSpot
Fips_OnTheSpot's picture

As it was ruled out, I already hear the "we want leverage, we want leverage" chorus...

Thu, 09/29/2011 - 07:09 | 1721279 wang (not verified)
wang's picture

adding leverage is a foregone conclusion, of course there will be much wringing of hands and gnashing of teeth before getting there but it is just theatrics, like in America the EZ political class is bought and paid for

wasn't it just a couple of months ago that Finland was the great hope for defeating the bailout class and yet they were first off the mark yesterday in supporting the expanded EFSF

$2T leveraged fund - bank on it

OT

new post from London Banker

http://londonbanker.blogspot.com/2011/09/transaction-taxes-and-transpare...

Thu, 09/29/2011 - 07:00 | 1721277 wombats
wombats's picture

Now that bonuses at the German banks have been saved, maybe the world can now turn its attention to saving  bonuses at BofA...and  C, JPM, GS. 

Thu, 09/29/2011 - 07:01 | 1721280 Arie L Ultra
Arie L Ultra's picture

I heard this morning that Greece needs a other 100 billion Euros. Let the fight begin

Thu, 09/29/2011 - 07:02 | 1721281 fishface
fishface's picture

and no life boats...

Thu, 09/29/2011 - 07:04 | 1721282 Spigot
Spigot's picture

Wow! Not much thinking going on in Germany, by the pols. Or maybe they were given "the talk"...

Destruction here we come.

Thu, 09/29/2011 - 07:11 | 1721305 The Swedish Chef
The Swedish Chef's picture

Handful of morons/criminals sold out their country, the people didn´t.

 

I really, really hope this is going to cost Merkel her job.

Thu, 09/29/2011 - 07:20 | 1721323 BigJim
BigJim's picture

What does she care? She's already secured a post-politics sinecure in some European bank as a 'consultant' or 'non-executive director'

Thu, 09/29/2011 - 07:04 | 1721283 RunningMan
RunningMan's picture

I am shocked the Germans approved the bailout. I thought them a more prudent people than that. Seems like everyone is in on the wealth transfer game.  I still don't know how markets will go anywhere on reaction to this, as until the money is freed up, who will pay to prop the market? Not I, sir. Not I.

 

Thu, 09/29/2011 - 07:13 | 1721291 Jayda1850
Jayda1850's picture

The German people are more prudent than this. The German politicians, on the other hand, are too busy sucking off the corrupt banksters to give two shits about the German people.

Thu, 09/29/2011 - 07:17 | 1721318 MarkD
MarkD's picture

Insert "American" instead of "German".

Don't we approve every bailout when threatened with ,  If you don't......... we will collapse.

Thu, 09/29/2011 - 07:55 | 1721385 Incubus
Incubus's picture

yes; we will collapse and that's what we need.  

 

Either we don't "collapse" and we'll be slaves at the hands of banksters and other financial parasites, fighting their wars, and working our lives away for them, or we say "NO U" to them and their bullshit and we figure out what the fuck life without corporate-sponsorship is like. 

Just make sure to keep religious nuts from trying to fill the influence-void that corporations would leave, and I'd think we'd be on the way to a pretty decent society, and building lives with some meaning that aren't designed around greatest profits for the executives of some corporation, or their friends in government. 

 

 

Thu, 09/29/2011 - 07:15 | 1721316 AnAnonymous
AnAnonymous's picture

I am shocked the Germans approved the bailout.

/////////////////////////////////////////////////////////////////////////////

Either a very naive person. Or a bad actor.

I opt for number two.

Thu, 09/29/2011 - 07:32 | 1721339 GetZeeGold
GetZeeGold's picture

 

The majority of Germans didn't vote for jack.

 

Thu, 09/29/2011 - 08:14 | 1721432 AnAnonymous
AnAnonymous's picture

The majority of Germans approve of their government's actions.

Thu, 09/29/2011 - 08:42 | 1721491 JOYFUL
JOYFUL's picture

"I opt for number two"

 

And a fine job you do at it!

In your sneering invective against everything "American" here today, you remind me of none so much as Roger Fritz in his role as "Triebig"(Cross of Iron 1977)...

so much depth, so little emotion - ZH...it's a Latin thang... Now piss off!

http://gnosticliberationfront.com/germans_enraged_by_merkels_grovelling.htm

Thu, 09/29/2011 - 07:05 | 1721286 The Swedish Chef
The Swedish Chef's picture

Yeah, I noted that, Tyler, I noted that... Hoped that Stockholm OMX30 would go apeshit but no. Closing longs at 920 and take lunch. It´s been a decent morning, let´s see if NY can rescue this sinking ship.

Thu, 09/29/2011 - 07:11 | 1721301 wang (not verified)
wang's picture

El Erian telegraphed this yesterday on Bloomberg

audio

http://media.bloomberg.com/bb/avfile/News/Surveillance/vqorZrTbE.o0.mp3

Thu, 09/29/2011 - 07:11 | 1721303 MFL8240
MFL8240's picture

The fuckin clown show is never ending.  Next we will see Mr. Bernanke decide to unilaterally bail out Greece.  That my friend is coming because the real exposure to a default is his comrades in the banking cartel on Wall Street.

Thu, 09/29/2011 - 07:18 | 1721319 BigJim
BigJim's picture

Yes, I've been waiting for that announcement too.

In effect, though, it's already been done - remember all those swap lines? Remember most of QEII went to European banks? US bailing out Greece('s creditors) in all but name.

Thu, 09/29/2011 - 07:53 | 1721379 youngman
youngman's picture

He will announce it ..and we will all say they will NEVER vote for it ..the people do not want it....never...and then...they vote for it....there is no common sense now....its print print print from here to destruction..devaluation..hyperinflation...

Thu, 09/29/2011 - 07:14 | 1721313 David99
David99's picture

USA GOT tarp + talf + QE1,2,3 = Total $ 10 trillion

Europe all put together = Total $ 500 billion

I think, it is not fair

Markets will tank -2% today

Thu, 09/29/2011 - 07:18 | 1721320 maddogs
maddogs's picture

Looks like the "Daisy chain""reach around" is entering another downturn. Even though the Markets know deprciating Fiat Currency reduces the value of it's Citizens.. it's a case of Bank and Bondholders thinking anything that could be possible for survival must be tried first, land last. This is getting well past anything other than self promotion for the Banks. Hope they are aware,while failure is not an option, for them, they are assuring failure on mainstreet.

Mainstreet will assure their failure. Race to the Bottom underway.

Thu, 09/29/2011 - 07:20 | 1721322 PaperWillBurn
PaperWillBurn's picture

Trigger finger is getting itchy. Do I buy my gold now or wait until u.s market opens.

 

decisions, decisions

Thu, 09/29/2011 - 07:30 | 1721337 GetZeeGold
GetZeeGold's picture

 

Predictably pushed red.........I'd buy now.

 

 

Thu, 09/29/2011 - 07:22 | 1721326 BlackholeDivestment
BlackholeDivestment's picture

...white punks on dope.

Thu, 09/29/2011 - 07:33 | 1721340 Mr_Wonderful
Mr_Wonderful's picture

The market will now experience an eerie sense of tranquillity at least until 2 PM EST.

Thu, 09/29/2011 - 07:33 | 1721342 Fix It Again Timmy
Fix It Again Timmy's picture

Fiat currency, the welfare state and our brilliant politicians - an enduring menage a trois...

Thu, 09/29/2011 - 07:35 | 1721345 Market Efficien...
Market Efficiency Romantic's picture

Europe should play the credit reinsurance markets with its EFSF, which would serve several purposes:

1) Avoid speculative action against Italy and Spain in the CDS markets, which has for some time created contagion in the bond market due to the asynchronity of both markets.

2) Create an incentive for private investment in European sovereign bond markets by providing affordable credit protection.

Thu, 09/29/2011 - 08:04 | 1721409 Everybodys All ...
Everybodys All American's picture

More credit swap derivatives ... only create more AIG's.

Thu, 09/29/2011 - 08:15 | 1721434 Market Efficien...
Market Efficiency Romantic's picture

so true. Well, playing CDS sure does not solve the problem, market inefficiency etc. It was more an attempt of hinting at what is spreading contagion and how contagion could be firewalled.

Thu, 09/29/2011 - 07:37 | 1721348 Mr.Sono
Mr.Sono's picture

lets see how German people will react to this vote. do i smell blood?

Thu, 09/29/2011 - 08:13 | 1721429 the not so migh...
the not so mighty maximiza's picture

it looks like they have been brainwashed since childhood just like in US.  They will support the banking cartel.

Thu, 09/29/2011 - 07:43 | 1721359 yabs
yabs's picture

as exepected the TBTF will crash nthe market un til Leveraged ESSF and QE 3 passes

easy to see throught their games

Thu, 09/29/2011 - 08:08 | 1721418 Ned Zeppelin
Ned Zeppelin's picture

This vote is all about the temptation of and succumbing to "kick the can," which for politicians is frankly irresistable. 

Thu, 09/29/2011 - 08:23 | 1721453 blindman
blindman's picture

gilligan's island intro .. s.s. minnow
http://www.youtube.com/watch?v=cfR7qxtgCgY
.
don't laugh
.
and don't forget the pequod.

Thu, 09/29/2011 - 09:08 | 1721618 yabs
yabs's picture

I just want 5this to crash and get it over with

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