In The Meantime, ECB QE Is On In Full Force With About $100 Billion In Open Market Bond Repruchases In Past Month

Tyler Durden's picture

And so the ECB's balance sheet, once upon a time clean of any monetization interventions, continues to deteriorate, and has now grown to a record €143 billion, after the bank disclosed €13.96 billion in PIIGS debt purchases in the prior week. This is an additional €70 billion since the SMP was expanded to purchase Italian and Spanish debt in early August (predicated by Italy complying with an Austerity prgoram that it has since made a complete mockery of). So for those complaining about the ECB pursuing Quantitative Easing, we wonder what one would call nearly $100 billion in bond repurchases in the open market in the past month: this is about as much as the Fed would purchase in its most active monetization month during either QE1 or QE2!

Alas, this is not enough for Morgan Stanley, which like the faitful copycat it is, has now joined Goldman in officially demanding more QE from Jean Claude Trichet.

Morgan Stanley's summary:

Bottom Line: As DM economies reach the end of their debt supercycle it really is different this time. Consequently, equities are unlikely to trough until long lasting solutions are found. We think this requires QE from the ECB, a new approach to fiscal policy and more debt write-downs.


This time it’s different


There has been a structural deterioration in the outlook for stocks given the relapse in growth and further escalation in the euro-zone debt crisis. We believe DM economies are now at the end of their debt supercycle. 


Equity valuations have further to fall


Market sentiment and valuation are low in a historical context, but are not yet at extreme levels of bearishness – for example, there is still 10% downside to a single-digit Shiller PE for Europe. Furthermore, equities are unlikely to bottom until we get evidence of fundamental improvement. 


What we want to see to turn more constructive


Given the size of problems facing DM economies we believe equity investors are increasingly looking for long lasting structural solutions. In our opinion, stocks are unlikely to trough until we see all of the following: #1 Large-scale QE from the ECB; #2 New fiscal policy to provide short-term boost and longer-term sustainability; #3 Debt write-downs for over-levered entities.

Full report:


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achmachat's picture

why is that not showing in precious metals?

what happened to precious metals these days.. I mean... where is all the money going? cash??

swissaustrian's picture

Looks like manipulation. Everytime London wakes up (4-6 am ET), pm´s take a hit. In 2008 this was done during CRIMEX trading (10 am ET. Statistical evidence: Just btfd

MillionDollarBonus_'s picture

The smart money is going into US treasury bonds. Smart, savy investors recognise that US treasuries derive safe-haven status from the courage and innovative ability of our congress and the intellectual capacity of our economic advisors. Obama's jobs plan includes a substantial amount of fiscal stimulus, which will power our consumer economy for the near-future, whereas Europe's lack of integration has caused disputes over large fiscal programs of a simmilar nature. The supercongress initiative is yet another example of our congress' ability to come up with innovative solutions to our economic problems. This has been priced in accordingly.

Theta_Burn's picture

^ WTF?

your making funnies right?

Theta_Burn's picture

You know, a WTF ETF sound brilliant about now

mess nonster's picture

That kind of sarcasm will put hair on your chest!

LowProfile's picture

You mean hair on his titanic balls.

WonderDawg's picture

Fuck, I wish I had that kind of poker face for my Wednesday night poker game. I could bluff my way to vast fortunes.

stormsailor's picture

i get it, its a momma joke. right?

Sneeze's picture

You are either the most sarcastic person I have ever read or the biggest moron outside of public service.  (If your in public service I can understand).  Tresuries do not "derive safe-haven status from the courage and innovative ability of our congress and the intellectual capactiy of our economic advisors"

Tresuries get safe-haven status because there are Americans left that still want wake up in the morning and go to work.

CosmicBuddha's picture


Judging by all the negative votes and comments you get I guess there are large number of zerohedgers who just don't understand irony.

I like the way you never explain yourself.

You make me laugh anyway!

Instant Wealth's picture

The MillionDollar Bonus opened my eyes. Tomorrow, I will convert from the heretic short side to BTFD.

MFL8240's picture

Because the finacial markets in the US are the most courrpt markets on the planet. When I saw the stock market turn positive, I laughed my ass off, this is just an all out effort to decieve.  Nothing new!!

Founders Keeper's picture


When markets are down and gold is up, that's a bad day.

When markets are down and gold is down, that's a REALLY bad day.  (Equals panic developing.)

Eventually, that will change.  For the worse.  As will life for all of us.



Spitzer's picture

Like when gold was up $25 on May 6 2010 ? (flash crash)

mess nonster's picture

Can't wait for PAGE to open, and see what happens to PM's then.

mess nonster's picture

Can't wait for PAGE to open, and see what happens to PM's then.

Overflow-admin's picture

Just look at Gold / Silver priced in CHF...

spondoolix's picture

PMs are down because the dollar is up against the Euro.  Read Gold Core's analysis posted on ZH earlier this AM.


good luck,


Spitzer's picture

Gold always makes a new high in Euros before it makes a new high in dollars. Check it out.

ZeroPower's picture

Yes - to fulfill margin calls on other shitty 'investment' choices.

Zap Brannigan's picture

NASDAQ, S&P are green, must be the trans-Atlantic wealth effect

DormRoom's picture

front running QE3 announcement on Sept 21.  If the Fed doesn't help now, it'll cost ALOT more in 4-6 months.

swissaustrian's picture

Price stabeeleetee through debt monetzation, bitchez!

agent default's picture

You mean the printing will continue until morale improves?

max2205's picture

Nice reversal in the market...PPT?

hedgeless_horseman's picture
09-09 12:38: Merkel says "Jah, zee German proles are goote whit zee money printing"
Instant Wealth's picture

Agreed. ZH should have an eye on him. Fits perfectly in the scheme "The Dark Lord of the Markets".

jdelano's picture

china buying euro, dollar down, market up

GeneMarchbanks's picture

FIAT is as FIAT does... Now truly, was the response of central bankers ever in doubt?


Founders Keeper's picture

They always print.  That's all you need to know.

Prepare accordingly.



Spitzer's picture

What do you think would happen if the ECB bid for gold with their US dollars ?Bretton Woods 2 would be dead the next day.

That is the ECB nuclear option and  I expect it in days.

Founders Keeper's picture

Only a fool would trade in this environment.

I cashed in my chips some time ago.  My only "trades" these days are in time.  Time to prepare for the worst while hoping for the best.

Theta_Burn's picture

HA and everyone was worried.

Even the Shit & Pee index is green now @ 9.59 EST (must have drank the purple coolaid)

hedgeless_horseman's picture

Did you see the Shuttle launch this morning?  Impressive display of American power.

Maybe-Not's picture

Aannnnddd........Were Green! All better now.

maxmad's picture

Looks like the manipulated rally FAILED, bitchez!

Belarus's picture

it's official: other than pure recreational entertainment, there is no need to follow these non-markets anymore. Sprott was right: JUST BUY PHYSICALL GOLD AND SILVER AND NOTHING ELSE, no stocks, funds, etfs, bonds, currencies, anything. Just physical. That will outperform EVERYTHING while preserve and protect. 

Fuck, last post of the day for me. I'll be too busy.

Dr. Engali's picture

Nice gap fill on the markets.

snowball777's picture

QE, Haircuts, and Riots...Oh My!

Everybodys All American's picture

Dow below 11,000 must set off Defcon 1 alert for Brian Sach


Gandalf6900's picture

sick green that is!

Eugend66's picture

"And so the ECB's balance sheet, once upon a time clean of any monetization interventions, continues to deteriorate, and has now grown to a record €143 billion, after the bank disclosed €13.96 billion in PIIGS debt purchases in the prior week. "

The Bernank is picking his nose, you think ?

Gandalf6900's picture

how easy is it to carry physical across borders?

thunderchief's picture

Metal confiscation will occur in many ways and is already.

Taxing yearly gains as winfall profits

not allowing export of metals

registering any purchases

mining taxes


dasein211's picture

Like i said. No huge moves until after 9/20 fed meeting. No one wants to sell in front of the qe train and no one wants to buy in front of the greece default train. Until then we trade sideways... Except for the dax and ftse of course.