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The Hill Just Killed The Market - Stocks, Euro Stumble As Conservatives Push To End IMF Bailout

Tyler Durden's picture


As rumors and chatter circulate across trading desks, European equity and credit markets are starting to lose their giddiness. European sovereigns are leaking back wider and financials starting to underperform and it is being noted that, as reported by The Hill, that conservatives say they will try to block the IMF from bailing out Italy and Spain. Pointing to the huge bill this could leave at US taxpayer's feet, Republicans are concerned at the secrecy with which Geithner has acted. Sen. Tom Coburn appears to be at the helm of this legislation, noting:

"We're throwing good money after bad down a hole that I think is not a solvable problem. Europe is going to default eventually, so why would you socialize their profligate spending."

Of course, this is beyond obvious, because as we have been saying all along with every reincarnation of the idiotic "IMF to bailout [XXX]" rumor, there always is just one snag. A rather substantial one at that: US congressional approval for expanded IMF bailout capabilities.Specifically, when discussing the latest iteration of the IMF rescue we said: "La Stampa forgot to mention one thing: any changes to the IMF, which currently is massively underfunded and is why the organization was forced to create two new liquidity facilities: a Precautionary and Liquidity Credit line, since it is unable to fund its New Arrangements to Borrow, have to go through US Congress when it comes to expanding funding capacity. Yup, the most dysfunctional, corrupt and criminal thing in the world - the US House of Representatives, where unless everyone is short Italian CDS, this will never pass. In other words: this rumor is dead in the water." And so it is.

From The Hill:

Conservatives craft bill to prevent IMF bailout of crumbling eurozone


Conservatives say they will try to block the International Monetary Fund from bailing out Italy and Spain, which they say could leave U.S. taxpayers with a huge bill.


Republicans on both sides of the Capitol complain that the Obama administration has refused to share details of what Treasury Secretary Timothy Geithner is discussing with European leaders amid reports the IMF could intervene.


Sen. Tom Coburn (R-Okla.) says he is planning legislation directing the U.S. government to veto an expanded role for the fund.


Senate Republican Steering Committee Chairman Jim DeMint (R-S.C.) and Rep. Cathy McMorris Rodgers (Wash.), a member of the House Republican leadership, also have legislation to curb the proposed intervention.


“I’m adamantly against the IMF being involved in this,” Coburn said.


“We’re throwing good money after bad down a hole that I think is not a solvable problem,” he said.


“Europe is going to default eventually, so why would you socialize their profligate spending,” he added.


Coburn estimates the U.S. could be liable for as much as $176 billion if the IMF shores up Italy and Spain and the European Union collapses.


President Obama this week said the U.S. “stands ready to do our part” to help resolve the crisis, and Geithner in October said using U.S. tax dollars through the IMF to shore up Europe’s efforts was appropriate.


DeMint offered an amendment to the defense authorization bill instructing the U.S. executive director of the IMF to use the voice and vote of the United States to oppose funding of the European Financial Stability Facility, the bailout fund that would be used to stabilize countries at risk of default.


“We need some transparency about what’s really going on,” said McMorris Rodgers. “It’s hard to get information. We’re talking about U.S. taxpayer dollars being involved in the European bailout. The administration needs to be honest with the Congress. I believe Congress needs to be involved in making this decision.”

At least this will halt the idiotic rumormill for a day or two.


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Fri, 12/02/2011 - 12:19 | 1938762 stop.snitching
stop.snitching's picture

Italian 5Y/10Y now inverted again! Saweet. A huge intraday turnaround of about 9 percent!!!

Fri, 12/02/2011 - 12:25 | 1938807 ucsbcanuck
ucsbcanuck's picture

Got a link to this?

Fri, 12/02/2011 - 12:28 | 1938823 stop.snitching
stop.snitching's picture

Just look at the 1 day charts on both...

5Y @ around 6.8%, 10Y around 6.7%

Fri, 12/02/2011 - 12:29 | 1938836 ucsbcanuck
ucsbcanuck's picture

Thanks buddy!

Fri, 12/02/2011 - 12:33 | 1938853 ratso
ratso's picture

This bill is as meaningful as a bill to end sharia law in the US.  It's going nowhere.

This is just more stupid political posturing by electioneering, right wing wingnuts

Fri, 12/02/2011 - 12:38 | 1938884 Carlyle Groupie
Carlyle Groupie's picture

It's also a glimps into your future if you pay taxes (99%'er).

Fri, 12/02/2011 - 12:58 | 1938991 whstlblwr
whstlblwr's picture

And they say voting doesn't matter.

Fri, 12/02/2011 - 13:19 | 1939074 strannick
strannick's picture

Congress can be such a party pooping nuisance.

Thats why the Fed finds it much easier and more convienient to perform their bailouts with low (no) interest currency swaps

“We need some transparency about what’s really going on,” said McMorris Rodgers. Is he kidding? Drag this financial abortion into the light of day, and people would run screaming from the market. Little late for righteous pontificating at this stage of the game.

Fri, 12/02/2011 - 14:32 | 1939357 eureka
eureka's picture

In Jim DeMint's demented world only the US has the right to monetize (aledgedly internally only) - after all USD is the world-mint - and yet, at the same time, Demint doesn'tunderstand that any bailout "loans" printed out of thin air by the US Fed and distributed to the globalist bankster-cartel (in this case EU banks to which US banks are heavily exposed) - costs the US absolutely nothing, but rather is essential to preserving global USD+military hegemony - and enables the uber-rich elite's continued aquisition of all real assets.

US FED RES has "printed" and donated $7.7 TRILLION to it's own local bankster cartels.

EU/Europe has yet to multiply its printing by a factor of 7 to catch of with US.

DeMint is a moron; he wants to tank his own Masters: the US Fed bankster military corporate mafia empire.

Whatever. Regardless of congressional theatrics, death is coming to USD as world currency reserve. Anyone with a brain knows it.

Fri, 12/02/2011 - 14:36 | 1939371 Augustus
Augustus's picture

Great observations.  Glad you are all in support of the IMF funding for the Euroland Bailout.

And you can call DeMint a Moron?

Fri, 12/02/2011 - 15:15 | 1939485 eureka
eureka's picture

I'm not in favor of any bailouts. I merely point out the hypocrisy: that US needs the bailout of some European banks, because its "own" banks are exposed to them - and, that since Germany won't allow ECB to "print" by issueing (and buying) EU bonds (as US FED RES buys US T-bonds) - well, the US FED & IMF has to print and "give"/"leand" it to some European banks.

AND - I point out that US "printing" "for" EU costs US nothing - but on the contrary is absolutely necessary to preserve US military and financial-corporate hegemony with cheap commodities for the US via a purposely deflating USD and continued exponential piling of US debt.

In other words, the matter is not US bailout of EU, but rather US bailout of itself and it USD world currency reserve regime. Of course I don't want the US/Fed Res to bailout EU banks - but - no such bailout is happening - the US is only bailing out itself - because it/Wall Street rigged EU sovereigns and EU banks with US garbage paper, just as it has rigged the entire world with increasingly worthless USD ever since WWII. 

US does not help anyone - US screws everyone, including the mass of its own citizens and working poor - and I merely point these facts out. Of course I also don't want US/FED bailout of US banks and corporations.

Here is my above comment again, in edited form (zh server failed to let me edit it aboove) Read it, and I'm sure you will see my point, and if not, you now know from the foregoing paragraphs what i was getting at.

thanks -

In Jim DeMint's demented world only the US has the right to monetize, and aledgedly internally onl. After all USD is the world-mint. Demint doesn't understand that bailout "loans" printed out of thin air by the US Fed and distributed to the globalist-bankster cartel (in this case EU banks to which US banks are heavily exposed) - not only does not costs the US absolutely anyhing, but rather is essential to preserving global USD+military hegemony - and to enabling the uber-rich elite's continued aquisition of all real assets.

US FED RES has "printed" and donated $7.7 TRILLION to it's own local bankster cartels.

EU/Europe has yet to multiply its "printing" by a factor of 7 to catch of with US.

DeMint is a moron, wanting to tank his own Masters: the US Fed bankster military corporate mafia empire.

Regardless of US congress theatrics, death is coming to USD as world currency reserve.

Fri, 12/02/2011 - 15:34 | 1939538 whstlblwr
whstlblwr's picture

Argument doesn't make sense. Deflating USD cause commodities to go up. It's time for taxpayers to stop bailing out US banks, whether from IMF, or whereever, banks who gamble and make risky bets that lose, should fail. Bernanke is rewarding risky behavior putting all of us at risk.

Fri, 12/02/2011 - 16:27 | 1939740 eureka
eureka's picture

Argument does make sense - from the POV of US elite and even US governent - who couldn't care less if commodities go up, because it/they are more concerned with controlling China and with decimating the value of China's holdings of USD and US Treasuries by purposely devaluing the USD which effectively wipes out US' massive debt, to not just China, but everyone. 

That said, I agree there should be no bailouts of any kind whatsoever, including of the US military empire, which serves no purpose except to force through globalism for the sake the global financial-corporate elite and their corporate and banking institutions.

The battle, gentlemen, is not between US and EU or the world - but between the global elite, who owns and controls the US Fed, US government, US military/CIA etc apparatus, and exploits the common man in the US as well as in most other countries, Europe somewhat excepted due to stringer worker's rights traditions.

And anyone here and anywhere, who are against worker's rights, by definition for the elite, the Fed etc..

Logic Will'st It, Bitchez. And that's Shapespearean Anglo-Mania, not Germania.

Sat, 12/03/2011 - 10:30 | 1941356 GetZeeGold
GetZeeGold's picture


What......the US taxpayer is against bailing out 50 year old Greek retired citizens.....that seems almost unamerican.

Fri, 12/02/2011 - 16:17 | 1939702 azusgm
azusgm's picture

The argument is based on the assumption that we NEED the TBTF banks and their derivatives.

Let those entities die and take the Fed with them.

Fri, 12/02/2011 - 16:31 | 1939756 eureka
eureka's picture

Agreed, just realize, acknowledge & embrace that with The Fed & banksters goes US Empire.

Fri, 12/02/2011 - 14:32 | 1939359 MonsterBox
MonsterBox's picture

What?!?  A congressman actually performing his duly elected duties?  Of course, it hasn't actually happened yet, so the insanity of shoveling taxpayer money to the banksters will likely prevail....

Fri, 12/02/2011 - 13:09 | 1939042 ceilidh_trail
ceilidh_trail's picture

Exactly. I for one do not want to pay ANYTHING to bail out useless europeans (via taxes or inflation). They spend themselves into oblivian and then cry and whine for the rest of us inferior beings to come rescue them AGAIN! We are not bailing out people so much as banksters that made dumbsh%t bets. When I do a dumb move, I eat it. Let them do the same.

Fri, 12/02/2011 - 13:12 | 1939060 Max Hunter
Max Hunter's picture

Not to mention.. We have our own problems..

Fri, 12/02/2011 - 15:05 | 1939457 ucsbcanuck
ucsbcanuck's picture

Aye to that - which is why I'm happy our Fin Min Jim Flaherty told them to solve their problems themselves

Fri, 12/02/2011 - 14:07 | 1939274 Jack Napier
Jack Napier's picture

If sovereigns default in Europe then banks across the globe, including in the US will default with them due to counter party risk. The Fed has to prop up Europe or all their primary dealers will go kaput, and then the game is over for the USD too. I don't like this any more than the next guy, but they don't have a choice. Their fate was sealed long ago, and they'll go down swinging. Just stay out of the way and enjoy the show. Guns, butter, and precious metals FTW.

Fri, 12/02/2011 - 14:26 | 1939332 Clorox Cowboy
Clorox Cowboy's picture

Wonder what tune Congress will be whistling once it becomes obvious that the "unfixable" hole that Europe is in will swallow the US as well?  I predict we'll see another TARP-style, ram-it-down-their-throat, MAD-avoiding bill...maybe Paulson is helping to draft it already?

Fri, 12/02/2011 - 14:23 | 1939328 Random_Robert
Random_Robert's picture

Why am I increasingly seeing people calling taxpayers the 99% .... ?

I'm seeing this everywhere. it's moronic.

In the US , The top 5% or earners pay 60% of the taxes, the next 45% of earners pay 37% of the taxes, and the bottom 50% pay 3% of taxes.

get your facts straight before spouting off about 99%'ers.

Fri, 12/02/2011 - 16:21 | 1939718 azusgm
azusgm's picture

Are you forgetting about the payroll taxes -- SS and Medicare?

Fri, 12/02/2011 - 12:38 | 1938886 Robot Traders Mom
Robot Traders Mom's picture

Agreed. It is pointless, right?

The Fed doesn't answer to congress. This isn't going to be the Treasury providing money to the IMF?

Fri, 12/02/2011 - 12:39 | 1938892 CClarity
CClarity's picture

A bit OT - but what's with the bump up in Morgan Staley, Goldman, and JPM.  7 and 8%?  Can't be Spain rumor.  BAC and WF not so much.  Clues?


Fri, 12/02/2011 - 12:43 | 1938922 ucsbcanuck
ucsbcanuck's picture

Sorry dude, that would mean trying to rationalize the market's behaviour, and if you haven't noticed by now - it's irrational.

Fri, 12/02/2011 - 13:02 | 1938999 Manthong
Manthong's picture

'Republicans are concerned at the secrecy with which Geithner has acted"

I believe Congress needs to be involved in making this decision.”

Geez.. so who sent them the memo pointing out that the House is supposed to control the purse strings?

Fri, 12/02/2011 - 14:10 | 1939286 Things that go bump
Things that go bump's picture

They want a piece of the vig.

Fri, 12/02/2011 - 12:40 | 1938900 Schmuck Raker
Schmuck Raker's picture


Although, it could pass if they attach a rider declaring 'Freedom' Fries will now be called 'Shut-the-f**k-up-and-do-what-we-tell-you' Fries.

Fri, 12/02/2011 - 12:48 | 1938940 SilverIsKing
SilverIsKing's picture

The Repubs need to be seen as trying to do the right thing so when the SHTF, they can blame the Dems.  They are all bought and paid for by the same banksters so nothing will come of this except make some of the sheep believe that they had our backs.

Fri, 12/02/2011 - 12:56 | 1938977 SMG
SMG's picture

You're right about them all being puppets. I wonder if the Oligarchy has finally decided to pull their finger out of the dam.  I still think one last deflationary wave benefits the oligarchy more, than just straight hyperinflation from here.

Fri, 12/02/2011 - 13:01 | 1939007 SilverIsKing
SilverIsKing's picture

Was the IMF set up in such a way that Congress has no jurisdiction over their decisions?

Fri, 12/02/2011 - 13:09 | 1939031 SMG
SMG's picture

I believe congress can cut or expand funding to the IMF.  But if congress is controlled by the same people who run the IMF, I guess it doesn't matter.

Fri, 12/02/2011 - 13:02 | 1939016 whstlblwr
whstlblwr's picture

No, not all are puppets, some care about country and not pocket book.

Fri, 12/02/2011 - 13:09 | 1939043 SMG
SMG's picture

As far as I can tell, anybody who cares about their country  and the 99%, and is effective at pushing that agenda, gets removed from office with character assisnation, redistricting,  or worse.

Fri, 12/02/2011 - 13:16 | 1939077 whstlblwr
whstlblwr's picture

Wrong. There is move on message board to discredit voting. Should tell you something, like maybe voting and getting involved matters.

Call your congress, organize people upset with military legislation or IMF funding to make meeting with their congressmen to oppose it.

Public opposition matters, and those we elect to represent us matter. If you can't run for office hold those you elect accountable.

Fri, 12/02/2011 - 13:35 | 1939138 Tramp Stamper
Tramp Stamper's picture

You sound like a terrorist to me

Fri, 12/02/2011 - 13:35 | 1939139 pods
pods's picture

Wow, please lay off the Hopium.  Or ship some my way!

Public opposition matters only when the issue doesn't.  For things that matters, you do NOT have a say (TARP).


Fri, 12/02/2011 - 14:17 | 1939208 whstlblwr
whstlblwr's picture

If we had elected enough of the right ones TARP wouldn't pass. Then after the vote public was mad and voted many out of office. Nothing happens in one minute. We must plan and most important is not to be wimps, you think Coburn et al do this because why? They were elected and represent people who don't like IMF getting taxpayer money.

If tired of bad news take break and them come back, but now is not the time to hide or shrug shoulders.

Fri, 12/02/2011 - 15:02 | 1939445 pods
pods's picture

I am not tired of bad news. I actually like the bad news.  The closer we are to collapse, the closer we are to restarting anew.

So we voted a whole hell of alot out, and the new crew did exactly what?

Anyone?  Bueller?

The TEA party put in a bunch, and when push came to shove, they voted for the system.  

You cannot vote in anyone who will take away his or her own power and authority.  Not going to happen as the people who want to be in those positions want power.

The IMF getting taxpayer money?  Please.

We have a 1.4 TRILLION dollar deficit, ain't no taxpayer money going to the IMF.  Unless you are speaking of my not yet born grandkids.

The system only survives cause of people like you who walk around with those dopey "I VOTED" stickers thinking that they actually have a say in the matter every two of four years.

Wake up.  It is a big fuckin club, and you ain't in it!  (thanks George)


Fri, 12/02/2011 - 15:31 | 1939520 whstlblwr
whstlblwr's picture

You're one of those who think if we stop printing we get collapse. Wrong. Maybe initially it will happen, because greedy people who buy bonds in bankrupt cities, companies will lose, but then opposite will happen, faith is restored.

Taxpayer money is going to IMF in form of inflation for all of us, idiot. And anyone who says inflation contained? How the hell is oil at $100, how the hell is stock market high when economy sucks? It's fucking inflation from printing that goes to bailout Europe, IMF, whoever the fuck they want.

Many elected Teaparty are doing good work and supporting things we care about, without the few it would be worse, and next election there will be more, and then election after that.

Fri, 12/02/2011 - 15:37 | 1939544 Flakmeister
Flakmeister's picture

The reason oil is at $100 is because of Peak Oil which is at the root of this mess. It is no longer possible to get growth out of the system and mask pledges that cannot be fulfilled... Very simple eh?

Now your Tea Party hacks are not doing good work, unless of course their goal is to collapse things in a way that screws most of the people.... I can handle hyperinflation, the black hole of deflation is another thing.....

Fri, 12/02/2011 - 15:44 | 1939565 whstlblwr
whstlblwr's picture

Peak oil is excuse all printers love to explain oil price. Without bank bailouts what would be price of oil? Good for you, you can handle hyperinflation, you have comfortable nest egg for yourself? good for you, selfish prick.

Fri, 12/02/2011 - 15:49 | 1939581 Flakmeister
Flakmeister's picture

So Peak oil is wrong?

Hell, with all the money printed up we should be able to increase supply, drop energy prices, stimulate consumption, in other words grow... What went wrong then??

So tell what the price of oil would be if the banks had not been bailed out? I am *very* curious to know...

Fri, 12/02/2011 - 15:53 | 1939591 whstlblwr
whstlblwr's picture

What was oil price in March 2009? Around $35, now it's 100. Think peak oil theory around since 70's. So in last two years peak oil got really serious, LOL.

Fri, 12/02/2011 - 16:19 | 1939626 Flakmeister
Flakmeister's picture

So you think that the price in a deflationary deleveraging of all assets is the correct one? So if oil should be $35 a barrel, what should gold be per oz?

Maybe explain to me why world oil net exports are down ~10% since 2005 and how the energy content of "All Liquids" is flat since then despite calling anything liquid that burns oil... 

And I have no idea what you meant by the word salad in the third sentence....

Fri, 12/02/2011 - 16:31 | 1939734 whstlblwr
whstlblwr's picture

Actually if you had comfortable nest egg, you wouldn't be on your knees for hyperinflation. You are leveraged to your neck. Those of us who don't use margin, or spend more than we can afford don't want to pay for your McMansion.

Fri, 12/02/2011 - 16:42 | 1939797 Flakmeister
Flakmeister's picture

Umm.. McMansion??? WTF are you talking about?

Look, you seem to be confused. I suggest you take some time and try to figure things out. I'll be back in a bit...

Fri, 12/02/2011 - 16:18 | 1939709 pods
pods's picture

I tried to be nice.  

If we stop printing we DO collapse.  Sorry, we have not paid a dime toward our debt principal for over 40 years!  Been running deficits that whole time.  

If we stop printing and have to fully fund each and every year's spending with current tax receipts we are going to suffer a cut to GDP of what, 13% immediately?  

As well as problems for every single muni and state who have borrowed money from the to fund UE shortfalls.  Forget about that?

What about the 45 million on food stamps?  How is that going to be financed?  SS?  That surplus is held in special non negotiable bonds.  Which would have to be rolled over or paid off.  No more debt spending, they would have to be paid off.  

With no printing then we would have to sell our bonds on the open market if we did try and deficit spend.  What do you think the effective interest rate should be on bonds for a nation with a 100% Debt to GDP ratio?

Less than 2% on the ten year?

Grow the fuck up and sit your ass at the big kids table.  TEA Party?  Sure the people are good, but the pricks elected are there to protect the system.  

If we are going to debate you have to realize what is actually going on.  

Stop your political thinking and actually try and imagine if the USSA would actually try to live within its means by either funding gov with current receipts or through actual open bond auctions.

But to sit off in lala land of "if we just elect the right people" bullshit while calling others idiots is the height of hypocrisy. 


Fri, 12/02/2011 - 17:50 | 1940037 whstlblwr
whstlblwr's picture

Whatever you do don't vote, right? It's just a waste of time, makes no difference they are all the same. Read a fucking history book and tell us that. You are an idiot. How did women and blacks get right to vote? Status quo were against it. I don't have time to teach you, but you obviously need school.

Fri, 12/02/2011 - 18:55 | 1940250 pods
pods's picture

If I am an idiot why is it you are asking a false question about women and blacks getting the right to vote?

There is no RIGHT to vote, it is a government granted privilege.  Rights exist independent of a government.  

If you are so big on democracy (which I am sure you support if you are calling voting a "right"), try and learn the term "legalized plunder."

It was written in a book, way back in history, which I clearly have no clue about, by a man who was smarter than most.

Bastiat was his name, and the essay was called The Law.

Look it up and get back to me.



Fri, 12/02/2011 - 19:41 | 1940333 whstlblwr
whstlblwr's picture

Hey fuckhead, you're harping on this on a blog post about Senators who want to stop IMF bailout. We voted for the senators, without them in office right now this second they would not be there to try and stop it. Tell your misguided point to someone who cares what you think.

Fri, 12/02/2011 - 20:08 | 1940419 pods
pods's picture

I replied to your post on a blog about how voting was going to be discredited.  Why the hell would those who run this show wan to discredit voting?

Voting is one of the only things they have left.  Voting is the true opiate of the masses.

It gives misguided souls like you the solace that they are actually doing something to affect the outcome of events.



Fri, 12/02/2011 - 19:12 | 1940293 Matt
Matt's picture

Societies that had inflationary collapses: Rome, China - several times, Weimar Germany, Zimbabwe.

Societies that had deflationary collapses: ??? Please provide some. I do not know of any country that had total social collapse as a result of deflation.

Look at Iceland as a model for how to deal with unmanageable debt, particularly bank debts owed by private banks.

Fri, 12/02/2011 - 19:55 | 1940391 pods
pods's picture

And what caused all those societies to collapse?  

Crushing debt. 

What was the cause of the hyperinflation?  Printing to avoid a crushing deflation.  

Iceland did great,but they were the first out, so they survived.  And had a small chunk of the world debt.

Rome collapsed by debasing the amount of silver in the Denarius.  This was to pay crushing debts and avoid deflation.

So you are correct in that the collapses were hyper-inflationary, but the causes were a deflationary default.


Fri, 12/02/2011 - 21:24 | 1940565 Use of Weapons
Use of Weapons's picture

Sadly, they might not.

There's a huge amount of mortgages still on the books (made not in ISK), with aggressive collection (with two of the major banks owned by non-Nationals), and 10-12 of the local municipalities are under extreme pressure, financially. There's parts of Iceland that are doing great (because, essentially, they were denied the "opportunity" to leverage up mortgages into foreign capital) and there's large sections (mostly in Rek) that are being flayed alive. Even for a small country, the situation isn't perfect. Add to this the things we're not supposed to talk about, such as massive fishing degradation in certain areas (Stikk - bivalves has crashed due to over-fishing) and the fact that if you look at the fishing data, they've had to switch from traditional sources into new species (such as mackerel, which has caused a new stand off with UK / Denmark) as they move north due to climate change moving their ranges because the traditional species / valuable markets got hammered.



We have hope that when the shit comes along, they'll probably do a viking berserk and do a reboot, and tell the foreigners to fuck right off. There's a good deal of hope that they can.

Fri, 12/02/2011 - 22:54 | 1940697 pods
pods's picture

Well on the outside they seem to be doing okay.  Better than most who have told the banksters to FO.

The one thing (from my outside view) that Iceland has going is that they seem to have energy independence.  That is a long term positive that is really valuable.

They also seem to have a very homogeneous population, which bodes well for nationalism.

I applaud them for the way they have basically told the bankers that the debts incurred are not those of Iceland.

The main staple of Iceland before the runup, fishing, is a very touchy situation.  The cold water fish reproduce slowly, and the stocks are not owned, so the old standby of fishing is perilous for them.  The demand of the USA has really taken a toll on the stocks, with cod and many other large cold water fishes being way over fished to allow McDonalds to give the masses access to "filets of fish."


Fri, 12/02/2011 - 16:42 | 1939798 dcb
dcb's picture

You got it. certain people in effect decide whom we vote for, then when in office are told if they don't do certain things, by certain people they will not get (fill in blank)

Fri, 12/02/2011 - 13:39 | 1939166 SMG
SMG's picture

Sure voting matters, but not enough people are awake to the Oligarchy to make a difference yet.  I am hopeful for the future though. 

Fri, 12/02/2011 - 16:39 | 1939786 dcb
dcb's picture

Now that he can be locked up by the military without trial for ever, I say go for it.

Fri, 12/02/2011 - 12:59 | 1938990 flattrader
flattrader's picture

They will be threatened with tanks in the streets...etc...just like 2008...and that will give them an excuse to cave.

Lather, rinse, repeat.

Fri, 12/02/2011 - 13:44 | 1939182 Teamtc321
Teamtc321's picture

You mean the U.S. treasury that act's without congress approval?

Fri, 12/02/2011 - 14:22 | 1939326 homme
homme's picture

Maybe, but it's not like there hasn't been unlimited opportunity prior, right? Why now?

Fri, 12/02/2011 - 12:26 | 1938815 jdelano
jdelano's picture

at least the clowns in washington are accidentally good for something once in a while...

Fri, 12/02/2011 - 12:51 | 1938950 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Exactly. Even a broken watch is right twice a day (at least one with hands). F*%k the IMF. I am tired of being a tax donkey for Europe!

Fri, 12/02/2011 - 13:21 | 1939092 JPM Hater001
JPM Hater001's picture

"Tax Donkey?  Oh no my friend, We will make your wives and your daughters tax donkeys.  You, by this day tomorrow you will be dead."

"You tell Rothchild there are FREE MEN HERE.  We will not be enslaved to your bank any longer!"

"Our arrows into your economy will crush your power.  Your sky will be papered in hyperinflation."

"Yes, but we have Ron Paul, bitch."

Fri, 12/02/2011 - 13:15 | 1939068 rufusbird
rufusbird's picture

Sounds like at least a few of them read ZH.

" Sen. Tom Coburn (R-Okla.) says he is planning legislation directing the U.S. government to veto an expanded role for the fund...I’m adamantly against the IMF being involved in this...We’re throwing good money after bad down a hole that I think is not a solvable problem,” he said.

Meanwhile I took the liberty to rewrite this part...

President Obama this week said the U.S. “stands ready to do our part” to help the money center banks out of this mess...

Fri, 12/02/2011 - 13:54 | 1939226 homer8043
homer8043's picture

I was going to say Tea Party but if you want to include all of the clowns, I can agree with that.

Fri, 12/02/2011 - 12:30 | 1938842 SMG
SMG's picture

Great insight in catching this IMF bailout failure. Thank you for your work Tylers.

Fri, 12/02/2011 - 12:43 | 1938919 Chief KnocAHoma
Chief KnocAHoma's picture

STAND FIRM CONSERVATIVES! This may sting a bit now, but at some point we have to take the pain!

I am The Chief.

Fri, 12/02/2011 - 12:52 | 1938962 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Conservatives are going to make sure the SHTF when election rolls around in Nov. 2012. It makes it all the easier to remove Obama.

Fri, 12/02/2011 - 13:16 | 1939075 Chief KnocAHoma
Chief KnocAHoma's picture

Not entirely true. Some are trying to do the right thing. No more debt, no more taxation.... enough of the socialist experiment.

Fri, 12/02/2011 - 13:22 | 1939094 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Chief, I agree with you. It is a right move. The Repugs make right moves when it benefits them though. Don't forget that.

Fri, 12/02/2011 - 13:32 | 1939123 Chief KnocAHoma
Chief KnocAHoma's picture

Oh I certainly agree. I describe the Republicans like this - THEY ARE SIMPLY LESS WRONG THAN THE ALTERNATIVE.

Fri, 12/02/2011 - 13:40 | 1939171 JPM Hater001
JPM Hater001's picture

Wow- look at us all the way out here...

Guys, Ron Paul.  Get it? Paul Vs Dems+Repugs.  His is the "Right answer" vs The Wrong and Less Wrong.

Im going to make posters that say that.  I'll make millions.

Fri, 12/02/2011 - 13:46 | 1939194 Chief KnocAHoma
Chief KnocAHoma's picture

I would like to support Paul, but fear a vote for him in a third party bid would be a vote for Obama. He can not win, and the LESS WRONGS won't allow him to be their nominee because of his foreign policy... he's too doveish for the blood thirsty.

Fri, 12/02/2011 - 14:22 | 1939323 JPM Hater001
JPM Hater001's picture

I lose more braincells explaining this to people so I dont remember if I read this here or somewhere else.

Clearly if Ron Paul won the nomination (just play along with me) I think pretty much all of the Republicans are going to vote for Ron Paul.

As for the Independents Ron Paul is the only Republican (he is actually a RINO but I'll take that shot like an Obama speech on ZH) candidate in some poll somewhere that beats Obama with the Independents.  I think you can add it up but I'll tell you the sum anyway: Reagan Landslide.

Fri, 12/02/2011 - 15:41 | 1939556 monoloco
monoloco's picture

If Ron Paul gets the nomination it won;t just be Republicans voting for him, there are plenty of independents and libertarian minded Democrats that are completely fed up with the current plutocratic two party clusterfuck, that will support him

Fri, 12/02/2011 - 17:55 | 1940063 Iwanttoknow
Iwanttoknow's picture

All independents will vote for RP.Libertarian repulicans will.may be ralph nader supporters will.I doubt chritian zionist will vote for RP.

Fri, 12/02/2011 - 13:39 | 1939164 Justawhoaman
Justawhoaman's picture

Too bad Demorats don't follow that policy...

Fri, 12/02/2011 - 14:24 | 1939330 JPM Hater001
JPM Hater001's picture

Please use adequately descriptive or uniformly complete names.

Make the idea easier to read...and accept.

Fri, 12/02/2011 - 12:56 | 1938978 SheepDog-One
SheepDog-One's picture

Bonds are where the real action is...equities are out back in the sandbox with hockey helmets on playing with cat turds.

Fri, 12/02/2011 - 13:38 | 1939154 pods
pods's picture

Or my favorite descriptior, "Paste Eaters".


Fri, 12/02/2011 - 21:46 | 1940593 Buck Johnson
Buck Johnson's picture

The author of this OP is totally dead on, there is no way that any funding or increased funding of the IMF (they where wanting to get rid of it anyway) will get through the house even the senate.  This is what you call the proverbial black swan event.  Everything falling apart, an election year in the US, all the EU countries (except for Germany) essentially insolvent, and a house and senate that is so toxic that Obama couldn't ask for something for free and they wouldn't give it to him because it's him. 

Sat, 12/03/2011 - 13:35 | 1941626 covert
covert's picture

eventually the whole truth fill come out and then there will be a sound financial policy leading to prosperity. this will take a very long while.


Fri, 12/02/2011 - 12:20 | 1938764 Fortunes Favor
Fortunes Favor's picture

Does this panic selling prove an investment thesis wrong? It does if you believe jumping off a cliff is right because everyone else is doing it.

Fri, 12/02/2011 - 12:22 | 1938765 Quinvarius
Quinvarius's picture

Unfortunately the Fed got permission to do whatever the Hell it wants to do from these "Senators" in 2009.  So that money is going out one way or the other.  This is what happens when a bunch of cowards give up their authority to a bunch of criminals.  The Senate has no power to do anything but suck it.

Fri, 12/02/2011 - 12:24 | 1938799 end da fed
end da fed's picture

yup that or the IMF will threaten to change the Petro Dollar to the Petro SDR

Fri, 12/02/2011 - 12:28 | 1938830 SokPOTUS
SokPOTUS's picture

Yeah, right.  Then we'll just turn off all the funding entirely.

You think any other .gov is going to continue to funnel money to that rat hole if we stop?


Fri, 12/02/2011 - 12:37 | 1938879 end da fed
end da fed's picture

i hope youre right, but can't the IMF just "print" too? (im not trying to be a smarta@%- i'm really wondering)

Fri, 12/02/2011 - 12:43 | 1938917 Paladin en passant
Paladin en passant's picture

In a word, no.  The IMF gets all its funds from member nations and the US is the largest contributor. So, no US dollars, no action, just lots of free words to appear like they're doing something.

Fri, 12/02/2011 - 13:08 | 1938933 end da fed
end da fed's picture

thx but then why all the talk about the IMF ever bailing out the US? the IMF wouldn't "print", they'd just use other members' funds?

Fri, 12/02/2011 - 13:32 | 1939122 flattrader
flattrader's picture

Yes...though it's a relatively laughable idea as the IMF stands now.

Britian, Japan and a few others with internal central banks can still print.

Of course, if the IMF charter/regs get rewritten in a global crisis, anything can happen via SDRs.

I personally think it will take an alien invasion to make THAT palatable.

Fri, 12/02/2011 - 13:44 | 1939181 end da fed
end da fed's picture

hmm thx then i'll hope for no aliens!

Fri, 12/02/2011 - 14:00 | 1939253 Cthonic
Cthonic's picture

Of course, if the IMF charter/regs get rewritten in a global crisis, anything can happen via SDRs.

That's why we need to get our gold contribution back.

Fri, 12/02/2011 - 16:10 | 1939670 Bansters-in-my-...
Bansters-in-my- feces's picture

The IMF is like a leech.

Without the blood of others it would die.....

Hmmm,Actually .come to think of it ,They are a leech.

Fri, 12/02/2011 - 12:31 | 1938847 The Fonz
The Fonz's picture

Well, undermining oil priced in dollars got Iraq, and Lybia invaded in less than three months. I would have to think that if the IMF tried that (they wouldn't) they would find themselves with a black sack over thier head on the way to an unaffliated torture facility... soonish. :P

Fri, 12/02/2011 - 12:39 | 1938893 Quinvarius
Quinvarius's picture

All I know is the Fed gave out 16 trillion in 2009 and told no one.  Lord knows what the Fed has been doing over the last two months.  And if the question ever comes up, these same senators will try to block finding out, just like they did last time.  My bet is the Fed has easily loaned 30 trillion by now.

Fri, 12/02/2011 - 13:12 | 1939062 whstlblwr
whstlblwr's picture

Yeah, right. Didn't Jim DeMint cosponsor audit the Fed?

Fri, 12/02/2011 - 13:45 | 1939192 TeresaE
TeresaE's picture

Not only did they "give" out 16 trillion, they did not have to increase their balance sheet at all to cover it.

Now that is some effective money printing, just push a few buttons and trillions can appear and disappear with NO effect!  NONE!

Ain't new math grand?

This is more political posturing by the corrupted.

The Fed Reserve don't need no stinkin' votes.

We will still (eventually) pay for this in spades.

Fiat on.

Fri, 12/02/2011 - 14:03 | 1939269 Cthonic
Cthonic's picture

The 16 trillion figure is hyperbole, the peak amount loaned secretly was around 1.8 trillion.  Isn't that an astounding enough sum?  Sure left me speechless.

Fri, 12/02/2011 - 12:21 | 1938768 the not so migh...
the not so mighty maximiza's picture

The congress people causing a problem will have a talkin too tonight.

Fri, 12/02/2011 - 12:28 | 1938822 kaiserhoff
kaiserhoff's picture

George Washington says there is no difference between the Parties...,

but then, he says a lot of stupid shit.

Fri, 12/02/2011 - 12:31 | 1938845 Spastica Rex
Spastica Rex's picture

Way to keep hope alive! Republicans to the rescue!

Fri, 12/02/2011 - 12:41 | 1938895 Carlyle Groupie
Carlyle Groupie's picture

The amazing thing is most of these uber-thesbians took NO acting classes. You are witnessing raw natural talent.

Fri, 12/02/2011 - 13:09 | 1939046 kaiserhoff
kaiserhoff's picture

Watch and Learn.

Fri, 12/02/2011 - 13:45 | 1939187 Spastica Rex
Spastica Rex's picture

We'll see, won't we?

Fri, 12/02/2011 - 12:22 | 1938771 SheepDog-One
SheepDog-One's picture

AHHHH HA HA HA HAAAAAA!!! Bye bye 600 DOW points! Caught the bulls like Peter Tchir with their mouths open!

Fri, 12/02/2011 - 12:28 | 1938827 ucsbcanuck
ucsbcanuck's picture

Dude you mean 60 points right? 600 is back to where we were on Tuesday LOL!

Fri, 12/02/2011 - 12:30 | 1938840 SheepDog-One
SheepDog-One's picture

UH yea before the fullretard'o'rama 'bailout news' runup. 600, bitchez.

Fri, 12/02/2011 - 12:38 | 1938889 ucsbcanuck
ucsbcanuck's picture

Gotcha - thought you meant the fall from the peak today. 

This is awesome - I hope there is a second pass at BAC $5 in the next week.

Never thought I say this, but GO REPUBLICANS! GO CONGRESS! Take away those hopium pipes!

Fri, 12/02/2011 - 20:06 | 1940413 ucsbcanuck
ucsbcanuck's picture

Wow someone junked me - work at B of A or something?

Fri, 12/02/2011 - 13:54 | 1939223 SamuelMaverick
SamuelMaverick's picture

TPTB decided to shear the sheep. Laughably predictable.

Fri, 12/02/2011 - 12:21 | 1938772 achmachat
achmachat's picture

are daytraders back in SLV and GLD?

how many more margin hikes do we need to get rid of the paper players?

Fri, 12/02/2011 - 12:23 | 1938787 RobotTrader
RobotTrader's picture

GDX/GLD ratio nearing 2011 lows.

GLD and SLV are holding up much better than GDX.

Fri, 12/02/2011 - 12:25 | 1938804 achmachat
achmachat's picture

please tell me that you know that GLD and SLV are just "paper" for daytrade playing/gambling?!

Fri, 12/02/2011 - 12:30 | 1938828 SheepDog-One
SheepDog-One's picture

This is Ro Bo Cosell, with, your, market, report-  Gold, which I, dont, down. 

Thank, you,....this has been Ro Bo Cosell...with your market minute.

Fri, 12/02/2011 - 13:24 | 1939102 dereksatkinson
dereksatkinson's picture

GDXJ is barely down.


GDX's move looks like funds that are doing year end selling.  It's sloppy and clearly a program.

Fri, 12/02/2011 - 12:21 | 1938773 JSD
JSD's picture

"Europe is going to default eventually, so why would you socialize their profligate spending."

Why not? We do it to ours once every few years.

Fri, 12/02/2011 - 12:21 | 1938774 rajat_bhatia
rajat_bhatia's picture

Down the rabbit hole we go

Fri, 12/02/2011 - 12:21 | 1938776 RobotTrader
RobotTrader's picture

Financials are not pulling back much.

MS still up 7% on the day.

Bears need to be careful.

Fri, 12/02/2011 - 12:25 | 1938809 SheepDog-One
SheepDog-One's picture

This, is, RoboCossell, financials which I dont own are up, gold which I dont Own, is, down....LULU and NFLX which, I, pre-tended, to own, are I, nevermind, all that.

This Has Been RoboCosell, with, your, morning, market, re-port.

Fri, 12/02/2011 - 12:35 | 1938870 Stoploss
Stoploss's picture

LOL!!! And just so there is no confusion, there is a rate imbalance between swap rate and the discount rate, which everyone should expect a discount rate cut of 25 to 50 bps.

Swap rates at 50 discount rate at 75. Robotard, they are pricing in a 50 bps rate cut at the disc wdo.

Fri, 12/02/2011 - 12:55 | 1938976 fuu
fuu's picture

I tried hard in a couple of spots in his theme song to make the voice sound like Howard just for you.

Fri, 12/02/2011 - 15:29 | 1939529 LongBallsShortBrains
LongBallsShortBrains's picture

".........LULU and NFLX which, I, pre-tended, to own, are I, nevermind, all that....."

It only pretends to own them when they are up.

Fri, 12/02/2011 - 12:26 | 1938813 homersimpson
homersimpson's picture

"MS still up 7% on the day"

Notice he didn't exactly post a link the MS chart the past year.

"Bears need to be careful."

So sayeth the bulltard whose livelihood basically on whether or not the Fed prints money. Not exactly the situation you want to live your life under.

Fri, 12/02/2011 - 12:30 | 1938839 Tsunami Wave
Tsunami Wave's picture

Homer, I know you're bullish (on occasion at least) with FAZ.. what are your thoughts on FAS?

Fri, 12/02/2011 - 12:29 | 1938832 slewie the pi-rat
slewie the pi-rat's picture

start drinking early, today, R_T

it was sink or swim for the euro

and it's stopped swimming


Fri, 12/02/2011 - 12:31 | 1938843 ucsbcanuck
ucsbcanuck's picture

Sorry slewie - like you and all, but let's calm down a little - you don't know what those printing presses are capable of

Fri, 12/02/2011 - 13:05 | 1939033 slewie the pi-rat
slewie the pi-rat's picture

hey!  ucsb? 

you've been posting up a storm, so, hi!

the heck i don't!  especially them swiss ones!

those EUR printers have been playing hard to least in public

now that we have the US pols involved in stentorious bloviating, elbowing for the cameras of pontification over the EU, let the serious holiday drinking begin!

[did you see where someone suggested the thesis that Prohibition caused the Depression?]

Fri, 12/02/2011 - 20:43 | 1940460 ucsbcanuck
ucsbcanuck's picture

Are you a Gaucho as well slewie? Yeah I was in UCSB grad school for electrical engineering from 1999 - 2005. I live in Ottawa, Canada these days. 

All I'm saying - in what can be best described as a complete gamble, I bought some BAC Dec 17 puts with a strike of $4. Not a whole lot - total outlay of around $1.5k for 200 contracts. I thought I was about to hit the jackpot on Wednesday - BAC was close to $5 on Tuesday, followed by the S&P downgrade. Then the co-ordinated bailout happened...

Hoping for another pass at $5 next week, but now I'm looking to recoup some capital more than anything else. It's clear to me now that TPTB will do ANYTHING to ensure that BAC will not drop below $5.

In any sane universe, the Euro would have been toast by now. How can any proactive company or individual hold cash in a currency with such an uncertain future? The USD sucks as well, but it doesn't face the same immediate existential crisis and it still is the global currency. Tyler's bank asset cash out and repatriation theory is the only reason that makes sense, but shouldn't the repatriation have ended by now? Unless there is something else going on that we don't know about. 

I've got puts on European and US banks expiring in 4, 6 and 12 months. I think some of those will be profitable.

"the heck i don't!  especially them swiss ones!"

Yeah, Switzerland has basically debased its currency. Stupid move really.

"did you see where someone suggested the thesis that Prohibition caused the Depression?"

Prohibition would have depressed me as well LOL! Seriously speaking - I think the Depression occurred due to a multitude of causes, but I don't think Prohibition was a cause. 

As for the US pols - you're right. Talk about a bunch of posturing blowhard assholes blowing hard out of their assholes. 

Fri, 12/02/2011 - 13:23 | 1939086 riley martini
riley martini's picture

 MS down 50% from Jan party on ROBO.

 Expect another bank stress test (sales pitch) from the FED to bring in the smart money.

Fri, 12/02/2011 - 12:21 | 1938779 qussl3
qussl3's picture

Repubs would blow up the world if they could unseat bambam.

2012 is going to be FUN.

Fri, 12/02/2011 - 12:26 | 1938810 Peter K
Peter K's picture

Bam's doing a great job of blowing up the US economy all by himself, thankyou. And the world too. Seen what's going on in Egypt lately :)

Fri, 12/02/2011 - 12:27 | 1938821 homersimpson
homersimpson's picture

Well, either way we're all screwed. So we mind as well be like a sports team and blow up quickly, take great pains, and rebuild sooner than 20 years later - like the Cleveland Browns.

Fri, 12/02/2011 - 12:33 | 1938859 Sophist Economicus
Sophist Economicus's picture

I loathe Obama,but I'm voting for him in 2012.   Why?  Because the only way to end this farce is to keep him in office - he will, unwittingly yet singlehandedly, revive the Constitution....

Fri, 12/02/2011 - 12:40 | 1938897 Global Hunter
Global Hunter's picture

Interesting theory and if I may add to your theory in my own words, a Republican President other than Ron Paul would just be a death by a thousand cuts, Obiewonder has gone full retard and it may just wake the sleeping.

Fri, 12/02/2011 - 13:09 | 1939050 americanspirit
americanspirit's picture

Just finished an interesting novel by Jack Higgens in which a German general says, regarding various attempts to assassinate Hitler, "Our only chance of ending this war is to keep Hitler alive. In his stupidity he was personally responsible for the loss of over 300,000 of our best troops at Stalingrad - what enemy could have been more effective. If he dies the war could go on indefinitely - with him in power it will end soon."

Hi Obie - wave to the cameras, read your prompter, and stay safe.

Fri, 12/02/2011 - 12:49 | 1938945 LawsofPhysics
LawsofPhysics's picture

Interesting thesis, but could be right.  The more he fights against it, the more he inadvertently exposes the intentions of the banking cartel and one world government.  He has allowed moral hazard to increase exponentially, this is what eventually leads to everyone saying "fuck it" and the system coming down.  Only then will compensation return to people who's labor is of real value (hint; not paper pushing fucknuts that buy congressmen).

Fri, 12/02/2011 - 12:55 | 1938969 spankfish
spankfish's picture

I am a Empire Wilderness kinda guy... waiting for the breakup.  Country cant last.  Some parts of the country have noting in common with the rest.  Why stay together?  Answer... it wont.

Fri, 12/02/2011 - 14:59 | 1939434 flattrader
flattrader's picture

Not until after they treat us as enemy combatants first.

Fri, 12/02/2011 - 12:22 | 1938780 Barry McBear
Barry McBear's picture

The story was posted on The Hill at 6:00 AM.  Took the market 5 hours to notice.  That's market efficiency for ya!

Fri, 12/02/2011 - 12:37 | 1938817 SheepDog-One
SheepDog-One's picture

Fullretard'O'Rama markets from here on out.

Markets earlier were too busy playing with cat turds in the sandbox to notice.

Fri, 12/02/2011 - 12:40 | 1938902 ucsbcanuck
ucsbcanuck's picture

More like the central banks turned on a laser pointer and the markets started chasing the laser pointer. Then they ran into a brick wall.

Fri, 12/02/2011 - 13:28 | 1939109 riley martini
riley martini's picture

 It took the corporate insiders that long to dump their shares before the corporate media news dump.

Fri, 12/02/2011 - 12:22 | 1938782 spartan117
spartan117's picture

Nice way to try and force liquidity into Treasurys.

Fri, 12/02/2011 - 12:29 | 1938783 GeneMarchbanks
GeneMarchbanks's picture

"IMF to bailout [XXX]"

Dirty. This is now becoming dirty.

'At least this will halt the idiotic rumormill for a day or two.'

Too bad the realization always comes at the end of the week.

Fri, 12/02/2011 - 12:22 | 1938784 AngryGerman
AngryGerman's picture

lol. whole europe is laughing over reps by now.

and don't forget, next time around imf will need to bail out us.

Fri, 12/02/2011 - 12:31 | 1938849 Dr. Engali
Dr. Engali's picture

We are the IMF

Do NOT follow this link or you will be banned from the site!