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MF Bankruptcy Causes Biggest Foreign Bank Liquidity Scramble To 'Fed Safety' Ever, Harbinger Of Major Eurobank Stress

Tyler Durden's picture




 

When Lehman filed for bankruptcy in that fateful week of September 2008, one thing caught everyone's attention: the epic surge in the Fed Reverse Repos originated by "foreign official and international accounts": essentially cash placed at the Fed by foreign institutions in exchange for collateral, primarily in the form of Treasurys, as well as other securities. This is nothing but an immediate cash parking in a 'safe place', which withdraws overall liquidity from the market, and as has been noted elsewhere, serves as an indirect gauge of banking system funding stress. In the week of September 24, this number soared from $46.6 to $93.7 billion, a $44 billion increase, or the single biggest jump in the history of the series. Well, as the chart below demonstrates, what happened with MF Global caught foreign banks, which as we have noted over the past several weeks have been dumping US Treasury and MBS paper, entirely by surprise as they scrambled to withdraw the last traces of available liquidity from the market, and to place as much of it as possible within the safety (and we use the term loosely) of the Fed. In the just released H.4.1 update, foreign Reverse Repos with the Fed soared from $81.3 billion to $124.5 billion, the most ever, and a weekly surge of $43.2 billion, the second largest ever, second only to the Lehman collapse. Furthermore, as noted daily, European banks have been doing precisely that with local cash from non-US subsidiaries, and parking near record amounts with the ECB (today the European central bank disclosed a whopping €253 billion had been deposited with it: just shy of the 2011 high), even as they have been dumping US Treasurys on one hand, and now are forced to repo what little paper they have left with the Fed due to systemic uncertainties in the MF aftermath, one can see why suddenly there was absolutely no liquidity left in the market, and why the meager €3 billion EFSF bond offering, so desperately needed to fund the ongoing Irish bailout and which incidentally is the story of the week, had to be pulled.

Behold the surge in weekly international reverse repos:

And the total weekly international reverse repo notional: we have a new all time record!

As the chart below shows, Fed reverse repo notionals are a very distinct leading indicator to the inverse performance of European financial stocks. Considering this, it would stand to reason that European banks are set to have some very turbulent upcoming days, as the money which should be in the market and be used to buoy European fin stocks, is far, far away, parked at some server located at Liberty 33.

The moral of the story is that the MF Global bankruptcy happened at the worst possible time. On one hand, European banks have been dumping tens of billions of US Treasurys, yet with the aftermath of this primary dealer bankruptcy, they have had to halt such sales and instead pledge USTs as collateral, thereby completely soaking up all incremental liquidity in the market. Recall that reverse repos are used by the Fed as a liquidity absorbing mechanism.

Which means that, all else equal, the pain for European banks, courtesy of the allegedly criminal mismanagement of the company of one Jon Corzine, is about to hit previously unseen levels.

 

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Thu, 11/03/2011 - 22:26 | 1843773 Careless Whisper
Careless Whisper's picture

Which means that, all else equal, the pain for European banks, courtesy of the allegedly criminal management of the company of one Jon Corzine, is about to hit previously unseen levels.

perhaps alot sooner than you think.

J. Corzine, MFCEO, Getting Slapped With A Subpoena

http://money.cnn.com/2011/11/03/news/companies/mf_global_subpoena/

 

 

Thu, 11/03/2011 - 23:23 | 1843888 paarsons
paarsons's picture

So when does it all fall apart.

Probably never.  These evil assholes are actually quite adept at keeping the ball in the air for a long long time.

http://fucklloydblankfein.blogspot.com

Thu, 11/03/2011 - 23:31 | 1843903 CrazyCooter
CrazyCooter's picture

Presented without comment ...

http://www.youtube.com/watch?v=-HaUQhzqwJs

... if you can't figure this math out ... or which side you are on ... well ... <insert some crap about history you won't read here> ...

Regards,

Cooter

Fri, 11/04/2011 - 00:15 | 1843999 Hohum
Hohum's picture

When does it fall apart?  When oil (WTI) is a little over $100.  Give the DOW another 15% at most.  When it's that much higher, WTI will be knocking on $110.

Fri, 11/04/2011 - 00:35 | 1844050 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

All of this has to do with oil.  From the Fall of '08, to the Wars around the globe, to the current collapse of the Fiat Ponzi, it all comes back to oil.

Fri, 11/04/2011 - 01:49 | 1844134 Richard Chesler
Richard Chesler's picture

Cockroach banksters will surive holocousts and nuclear attacks.

Live with it bitchez!

Fri, 11/04/2011 - 00:23 | 1844023 piceridu
piceridu's picture

I agree, I'm beginning to think that after what happened in 08 with the Lehman crash, and Paulson scaring the shit out of the dumbfucks in the House and Senate, that this will never end because nobody's watching the store. I wonder if they can just splash as many digits around the world as they want with impunity. 

Fri, 11/04/2011 - 00:44 | 1844058 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

They can; until gold is worth how much though?  $100k per?  LOL!

Fri, 11/04/2011 - 06:51 | 1844260 spankfish
spankfish's picture

Like all good shoplifters, the one's on Wall St. are watching the store.  Loot and pillage my friend.

Fri, 11/04/2011 - 05:52 | 1844234 CPL
CPL's picture

It took 20 years for the Savings and Loans to finish in court, WorldCom is still going, BreX I don't think has ever been closed.

 

Courts for baby lawyers to get their teeth cut and endless legal fees, what could be more kenysian.

 

Frankly I'm bullish about the whole thing...lol

Fri, 11/04/2011 - 02:24 | 1844156 Buck Johnson
Buck Johnson's picture

What was truly funny today was when a they thought Jeffries was another MF.  Whitney had to come out and essentialy defend them saying they weren't risk takers.  People where saying they where the same size and same rating and where investing like MF.  I think that there are alot of bodies that are about to float to the surface and MF was the first.

 

And as of right now this minute, go to CNBC and Commerzbank is the next body.  This is getting crazier and crazier.

Fri, 11/04/2011 - 05:54 | 1844235 CPL
CPL's picture

Well of course they are, CNBC can't justify it's 24 hour infomercial channel without defending it's sponsor.

Fri, 11/04/2011 - 06:19 | 1844247 Miss Expectations
Miss Expectations's picture

J. Corzine, MFCEO, Getting Slapped With A Subpoena

prefer...

J. Corzine, MFCEO, Getting Beaten Senseless with an Arrest Warrant.

Fri, 11/04/2011 - 07:25 | 1844300 max2205
max2205's picture

Bernie Ebers comes to mind. When does he get out?

Thu, 11/03/2011 - 22:26 | 1843774 spdrdr
spdrdr's picture

This is bullish, right?

Thu, 11/03/2011 - 22:42 | 1843813 navy62802
navy62802's picture

Definitely bullish ... extra bullish with some bullishness on the side. Hell, with all this extra bullish news coming out over the past few days, I don't know why we're not at Dow 14,000.

Thu, 11/03/2011 - 23:03 | 1843863 FranSix
FranSix's picture

This is black swannish of the soft variety, like a felt swan swimming down a river of ashes.

signed, 

Pancho Neruda Six

Fri, 11/04/2011 - 00:06 | 1843981 John_Coltrane
John_Coltrane's picture

In the language of "1984", its double plus bullish!

Fri, 11/04/2011 - 02:02 | 1844143 Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture

To the printing presses!  Damn the inflation, full speed ahead!

Thu, 11/03/2011 - 22:27 | 1843776 Mutatto
Mutatto's picture

So how fast can the money parked at the fed be recalled to the banks?

 

Thu, 11/03/2011 - 22:30 | 1843784 Tyler Durden
Tyler Durden's picture

It's not a question of speed. It's a question of confidence (ref: Jefferies). With the SEC's perpetual inability to enforce anything, and with moral hazard every place you look, confidence is gone.

Thu, 11/03/2011 - 22:32 | 1843792 Terminus C
Terminus C's picture

The question is, how many more primary dealers are going to drop off in the next week or so?

Thu, 11/03/2011 - 22:47 | 1843829 seek
seek's picture

That's a good question. I think the other good question is how many go away before we hit a confidence breaking point. I think maybe two more is the limit, and they better be small.

Thu, 11/03/2011 - 23:15 | 1843880 Spitzer
Spitzer's picture

I would guess some Euro land primary dealers are hurting.

Thu, 11/03/2011 - 23:51 | 1843937 CrazyCooter
CrazyCooter's picture

TD, I must dissent. All global markets needs is ... well ... more cowbell. If the 'Nank had three neurons touching in his skull, he'd have Christopher Walken on the white courtesy phone stat. I mean, he puts his pants on and knocks out GOLD!

Baby, don't fear the reaper.

Regards,

Cooter

Thu, 11/03/2011 - 22:40 | 1843804 Mutatto
Mutatto's picture

Thanks.  So it's not really an issue for the bank making the deposit so much as it is for the OTHER banks that might have wanted to use the funds?

Thu, 11/03/2011 - 22:44 | 1843821 navy62802
navy62802's picture

To me it doesn't look like "perpetual inability" to enforce anything. It looks more like corrupt refusal to enforce their own regulatory laws. I can only buy the ignorance cop-out so many times before it just looks like blatant corruption.

Thu, 11/03/2011 - 22:51 | 1843839 WonderDawg
WonderDawg's picture

It is, without question, blatant corruption.

Thu, 11/03/2011 - 23:01 | 1843860 DaveyJones
DaveyJones's picture

you got it

Fri, 11/04/2011 - 05:10 | 1844225 deKevelioc
deKevelioc's picture

If all the bastards go to jail, who will replace the useful idiots?

Fri, 11/04/2011 - 07:49 | 1844321 i-dog
i-dog's picture

a) They're not idiots. They are very deliberately complicit and corrupt!

b) There are plenty of reserves all warmed up and waiting on the benches for an opportunity to take to the field!

For every politician who "won" a chance to dip their snout in the swill trough, there are 6 more who lost and will be trying again.

For every bank executive who got promoted to a "bonus" slice of the swag, there are a dozen more jostling for position to take their place.

For every career regulator who has turned the other way and pocketed a bribe, there are a dozen more waiting to take their place as they exit through the revolving door to a cushy position with a "benefactor".

It's the system that is corrupt, not just the individuals who are "following the rules", "following orders" and/or "following the money".

As a corrupt senior cop once confided in me when I asked him why he did it: "You either get on the bus or get run over by it!"

Government is the problem, not the solution ... and the biggest problem of all is a remote central government!

SECEDE NOW!!

Thu, 11/03/2011 - 23:06 | 1843867 DeadFred
DeadFred's picture

What are the remaining factors between the present situation and a cascade of liquidity withdrawal like the one that made the Fed and Treasury say we were hours from collapse in '08? Just time, or were there other critical factors which have yet to rear their heads?

Thu, 11/03/2011 - 23:26 | 1843893 Mactheknife
Mactheknife's picture

When the sharks smell this much blood in the water....could be just one more little moronic keystroke away that causes some great white to take a big ole bite and take this corpse down.  Happy hunting.

Thu, 11/03/2011 - 23:40 | 1843920 westboundnup
westboundnup's picture

Oh that shark bites . . . with its teeth babe.

Fri, 11/04/2011 - 00:07 | 1843948 Arkadaba
Arkadaba's picture

There is no shark in the water. Have been looking to see one since 2007 but none sighted yet.

Fri, 11/04/2011 - 00:12 | 1843949 Arkadaba
Arkadaba's picture

.

Fri, 11/04/2011 - 00:13 | 1843950 Arkadaba
Arkadaba's picture

.

Fri, 11/04/2011 - 00:15 | 1843951 Arkadaba
Arkadaba's picture

Multiple connent - sorry all

Thu, 11/03/2011 - 23:12 | 1843876 holdbuysell
holdbuysell's picture

Exactly.

Why are many here at ZH pulling cash out of the financial system and parking it in hard assets, e.g. precious metals?

Fri, 11/04/2011 - 00:05 | 1843896 DeadFred
DeadFred's picture

Maybe in part, but grab a gold coin, heft it in your hand as you gaze at the pretty color. To get that feeling from looking at a paper account I think you'd need a 7 or 8 digit number on the bottom line.

Fri, 11/04/2011 - 00:17 | 1844007 Hohum
Hohum's picture

Maybe because precious metals have outperformed most stocks since the beginning of the year (and before, too).

Sun, 11/06/2011 - 18:55 | 1851383 css1971
css1971's picture

How is this taking cash out of the financial system?

You pay money to someone, what do they do with it?

Sun, 11/06/2011 - 19:49 | 1851528 LongBallsShortBrains
LongBallsShortBrains's picture

It goes to all the employees of the mint and the mine and all they consume, it goes to taxes on the mine and the employees and all they consume. It goes to the driver who delivered the fuel to the mine, to his boss, and the trucking company itself, and to taxes on the drivers income, all he consumes, taxes on the trucking company, taxes on the fuel .....................etcetera etcetera

In the end,
It mostly goes to taxes.

Thu, 11/03/2011 - 23:22 | 1843886 scatterbrains
scatterbrains's picture

btw as I understand it looting, pilaging or outright theft of account funds, should it cause a default/bankruptcy does not technicaly trigger a cds payout just so you know.

Fri, 11/04/2011 - 00:27 | 1844031 aus_punter
aus_punter's picture

you are wrong

Thu, 11/03/2011 - 23:49 | 1843932 Treason Season
Treason Season's picture

...confidence is gone = lose your counterparty = buy gold

Fri, 11/04/2011 - 00:52 | 1844070 HAL 9000
HAL 9000's picture

Has the mission been completed? You know that I have the greatest enthusiasm for it.

Thu, 11/03/2011 - 22:28 | 1843777 NotApplicable
NotApplicable's picture

Whee!

Thu, 11/03/2011 - 22:29 | 1843779 Terminus C
Terminus C's picture

Boom! Bitchez...

Thu, 11/03/2011 - 22:29 | 1843780 PicassoInActions
PicassoInActions's picture

lets get it clear.. will the eruo go down or up?

i am interesting in currencies only.

Any sugestions?

Thu, 11/03/2011 - 22:54 | 1843845 jeff montanye
jeff montanye's picture

are you interesting even then (snippy)?

Thu, 11/03/2011 - 22:54 | 1843846 I think I need ...
I think I need to buy a gun's picture

is this steve liesman from cnbs? I know those guys come on here

Thu, 11/03/2011 - 22:54 | 1843849 Melin
Melin's picture

You got junked for expressing self-interest...that's not yet acceptable to some on ZH.

Thu, 11/03/2011 - 23:21 | 1843885 Schmuck Raker
Schmuck Raker's picture

Oh crud.

I thought self-interest was why we were all here.

Fri, 11/04/2011 - 00:49 | 1844064 wretch
wretch's picture

Got junked for saying stupid shit.  You're picking up on a distinct bias ZH has against dumbasses.

Fri, 11/04/2011 - 06:10 | 1844243 CPL
CPL's picture

He got junked for for speaking out of turn, if he wants FIAT markets, there are a half dozen place he could go to.

Fri, 11/04/2011 - 06:10 | 1844244 CPL
CPL's picture

He got junked for for speaking out of turn, if he wants FIAT markets, there are a half dozen place he could go to.

Fri, 11/04/2011 - 00:50 | 1844066 Ponzi Unit
Ponzi Unit's picture

Why do I suspect he's not interesting in any language?

Oh, all right, the euro will fluctuate.

Thu, 11/03/2011 - 22:30 | 1843783 YesWeKahn
YesWeKahn's picture

Market rallied 25% since then.

Thu, 11/03/2011 - 22:31 | 1843787 Tyler Durden
Tyler Durden's picture

Since Monday?

Thu, 11/03/2011 - 22:42 | 1843814 YesWeKahn
YesWeKahn's picture

Sorry Tyler, misread the date.

Fri, 11/04/2011 - 00:51 | 1844069 wretch
wretch's picture

Brutal.  I think you're getting junked for showing weakness.

Fri, 11/04/2011 - 02:19 | 1844151 DavidPierre
DavidPierre's picture

Dear Tyler Durden:

Denying a recent freedom-of-information request from a citizen of the United Kingdom, the Bank of England has insisted on secrecy for its swapping and leasing of gold from the national reserves.

Replying on October 24 to GATA supporter James Burn, who sought a more precise accounting of the British gold reserves, Bank of England spokeswoman Jackie Keating wrote that the gold swap and leasing information is "market sensitive" and its disclosure "would allow enquirers to find out what gold transactions have been taking place." This, the bank's spokesman wrote, would impair the interests of both the British government and the bank's "private customers," to whom the bank "owes a duty of confidentiality."

The statement thus confirms that the Bank of England is surreptitiously active in the gold market on behalf of both the British government and the bank's "private customers" and that the interest of British citizens in knowing how their government is meddling in supposedly free markets is quite secondary.

Thanks to our friend Bern, it thus has been demonstrated again that there is plenty of financial journalism to be done simply by pressing central banks with questions about their surreptitious activity in the gold market.

Who will be the first financial journalist to attempt this and to have enough resentment about being shut out of the public's business that he publishes a news story about it?

Is there such a mainstream financial journalist willing to risk his invitation to a few very nice Christmas parties and his access to highly placed official sources?

The Bank of England's reply to Bern has been posted at GATA's Internet site here:

http://www.gata.org/files/BankOfEngland-GoldSwaps&Leases-10-24-2011.pdf

CHRIS POWELL

Sun, 11/06/2011 - 18:59 | 1851399 css1971
css1971's picture

This has been going on forever though.

Hell, Brown sold off all the gold for pennies, i'm not sure there's all that much left to meddle with.

Sun, 11/06/2011 - 19:55 | 1851546 LongBallsShortBrains
LongBallsShortBrains's picture

That's a lot of pennies!!!!

Thu, 11/03/2011 - 22:31 | 1843786 stocksugg
stocksugg's picture
MF Global may have hidden debt, WSJ reports

 

OS ANGELES (MarketWatch) -- Bankrupt broker MF Global Holdings Ltd. /quotes/zigman/7192996 MFGLQ +11.24% may have tried to disguise its debt through window-dressing, temporarily deleveraging ahead of releasing quarterly results, The Wall Street Journal reported Thursday, citing its own analysis. The U.S. Commodity Futures Trading Commission is already looking into reported shortfalls in customer funds at MF Global, which filed for bankruptcy protection earlier this week. The Wall Street Journal reported separately Thursday that MF GLobal Chief Executive Officer Jon Corzine, formerly governor of New Jersey and CEO of Goldman Sachs Group Inc. /quotes/zigman/188479/quotes/nls/gs GS +0.11% , has hired prominent defense attorney Andrew Levander of Dechert LLP to represent him if legal matters arise. The latter report cited unnamed people familiar with the matter

http://www.marketwatch.com/story/mf-global-may-have-hidden-debt-wsj-repo...

Thu, 11/03/2011 - 22:48 | 1843830 navy62802
navy62802's picture

This is why I just want to bang my head on the wall every time I hear politicians say we need more regulations. The regulations we have are sufficient to ensure healthy market operations. What we need is proper enforcement of those regulations. Which would begin with non-corrupt regulators who know what the fuck they're looking for. As it stands now, the regulations are little more than words on a page because the regulators are not enforcing their own laws ... whether it's because of ineptitude or corruption.

Thu, 11/03/2011 - 22:59 | 1843856 jeff montanye
jeff montanye's picture

and would that it were limited to white collar crime.  oh no, we've got to take extra legal imprisonment, illegal war, torture, rendition, assassination.  of u.s. citizens no less.  change you can't refuse.

Sat, 11/05/2011 - 05:54 | 1848120 MSimon
MSimon's picture

You left out Drug Prohibition.

 

"The Latin American drug cartels have stretched their tentacles much deeper into our lives than most people believe. It's possible they are calling the shots at all levels of government."
- William Colby, former CIA Director, 1995

Thu, 11/03/2011 - 23:21 | 1843884 DeadFred
DeadFred's picture

Every authoritarian dreams of a world where all actions are illegal but they alone get to choose who will be prosecuted. We aren't very far from that world. Anyone want to bet that the MF Global situation gets off-loaded onto some rogue Nigerian account manager?

Thu, 11/03/2011 - 23:42 | 1843923 Beam Me Up Scotty
Beam Me Up Scotty's picture

Why waste your time enforcing regulations when you can watch the latest Evil Angel porno on the internets?  Isn't that what regulators are paid to do?   Watch porn?

Fri, 11/04/2011 - 00:10 | 1843988 Catman
Catman's picture

And we need some executives with morals - remember those?

Fri, 11/04/2011 - 00:58 | 1844080 ReactionToClose...
ReactionToClosedMinds's picture

the 'market' will always be one-step ahead of the regulators ... ask old Joe Kennedy Sr ... the original head of the SEC

Fri, 11/04/2011 - 02:30 | 1844162 DavidPierre
DavidPierre's picture

MARKET=MAFIA

In 1933 Joseph Kennedy's years of partnership with the Mafia in the bootlegging business, along with a lot of garden variety swindling, have seen his fortune grow to about two hundred million dollars.  TPTB have wrung as much profit out of Prohibition as they can and it's time to change the rules of the game again.

As the repeal of Prohibition becomes imminent, Kennedy exploits his position as Franklin Roosevelt's bagman and takes Roosevelt's son James on a little trip to Britain.

The Roosevelt name gets Kennedy access to some of Scotland's largest distillers and he returns to the U.S. with the distribution rights to Haig & Haig, Dewar's Scotch and Gordon's Gin. Kennedy is able to exploit his Washington contacts to obtain import licenses for large quantities of liquor for "medicinal purposes" and fills his warehouses with Scotch and gin. When Prohibition is repealed on December 5th, Kennedy is ready to meet the demand and make another fortune.

The Securities and Exchange Commission (SEC) is created, theoretically to clean up the financial swindling industry which has ravaged the wealth of Americans.

Franklin Roosevelt, having a puckish sense of humor and owing a favor or two to "Jittery Joe" Kennedy for cash received, appoints him as the SEC's first chairman.

As one of America's leading financial scam artists and stock market swindlers, Kennedy certainly knows how the crooks work. Roosevelt justifies the appointment by telling an advisor that it takes "a thief to catch a thief."

You just can't make this shit up.

Sat, 11/05/2011 - 05:56 | 1848121 MSimon
MSimon's picture

I repeat myself:

 

"The Latin American drug cartels have stretched their tentacles much deeper into our lives than most people believe. It's possible they are calling the shots at all levels of government." - William Colby, former CIA Director, 1995

Fri, 11/04/2011 - 01:01 | 1844084 Ponzi Unit
Ponzi Unit's picture

Regulatory capture, legislative capture. Ah, sweet for the money masters. Until the marketplace is saturated with more corruption, self-dealing, and systemic risk than the global matrix can stand, at which point we experience criticality. That last grain of sand detaches from the slope, and...

Is there a Wiley Coyote moment in the offing, or just more crisis fatigue?

Fri, 11/04/2011 - 06:01 | 1844238 Dingleberry
Dingleberry's picture

As long as there is internet porn to distract it, the SEC will remain flaccid in prosecuting Wall Street criminals.  

Fri, 11/04/2011 - 07:10 | 1844272 spankfish
spankfish's picture

Na, regulation smegulation... I do have the porn site and password to the SEC account thou.

Fri, 11/04/2011 - 07:22 | 1844288 Bolweevil
Bolweevil's picture

"We need more stringent regulations," uttered by a congress-critter means "I'm bought and paid for, thank you very much."

Thu, 11/03/2011 - 22:33 | 1843788 bob_dabolina
bob_dabolina's picture

Gold bugs will be blowtorched as there is a mass dash to the safety of uncle Gorilla fiat paper

SBUX, NFLX, LULU, and XRT are all screamers punching through resistance levels 

Big buyers will swoop in tomorrow to pick great names like SBUX and JEF, bears will be throwing up blood

Thu, 11/03/2011 - 22:35 | 1843795 Terminus C
Terminus C's picture

Is that you Robo?

And... gold bugs don't get torched... paper traders get torched.

Torch my gold and I just recast and stamp it... still all there.

Thu, 11/03/2011 - 22:39 | 1843803 bob_dabolina
bob_dabolina's picture

haha... I can't believe that worked so quickly

Thu, 11/03/2011 - 22:50 | 1843838 Terminus C
Terminus C's picture

Well, we've determined you are not Robo as he never responds.

Thu, 11/03/2011 - 23:00 | 1843852 bob_dabolina
bob_dabolina's picture

It's funny because he says the same thing over and over again. 

His trading vernacular is very limited to the point it is instantly recognizable. It almost sounds scripted to me.

Thu, 11/03/2011 - 23:15 | 1843859 Terminus C
Terminus C's picture

Indeed, it is almost like he is a bot.

That would be fitting I guess.

*edit* I am not your junker btw.

Thu, 11/03/2011 - 23:31 | 1843902 bob_dabolina
bob_dabolina's picture

I could care less about junks.

Fri, 11/04/2011 - 00:55 | 1844076 wretch
wretch's picture

You couldn't care less, bob.  Think about your words.

Fri, 11/04/2011 - 01:13 | 1844100 bob_dabolina
bob_dabolina's picture

Unless I really do care about getting junked

Or perhaps I was using it as a reprensenation of sarcasm, in which case I suppose I should have followed through with /sarcoff

Perhaps the true tragedy is that now you will never know if I truly could care less, or couldn't care less, or if I'm being sarcastic about caring.

Fri, 11/04/2011 - 03:59 | 1844188 jomama
jomama's picture

or, you're just another lying, racist, asshole troll (that nobody likes).

but i'm sure you already get that a lot.

Thu, 11/03/2011 - 22:52 | 1843840 navy62802
navy62802's picture

On a side note, paper ignites at 451 degrees Fahrenheit. Gold melts at 1,947.52 degrees Fahrenheit.

Fri, 11/04/2011 - 01:27 | 1844121 Lazlo Toth
Lazlo Toth's picture

Damn.

There goes my theory that the WT center was made of Gold....

 

Fri, 11/04/2011 - 00:43 | 1844057 piceridu
piceridu's picture

No it's BullShit Bobby D...you know the guy that brags about trades he made in his paper account.

Fri, 11/04/2011 - 06:27 | 1844250 nmewn
nmewn's picture

;-)

Thu, 11/03/2011 - 22:40 | 1843805 Mr. Lucky
Mr. Lucky's picture

BTFD

Thu, 11/03/2011 - 23:20 | 1843883 fnord88
fnord88's picture

I want to....but how long do i keep powder dry? Maybe it will dip further, maybe it will not. Eventually it will be a lot higher than it is now,, so i'm starting to think I should just go all in. Watching this clusterfuck everyday is doing my head in. Maybe in the future i can get it at a 30% off sale, but for the sake of my sanity, maybe i should just buy now, and sit on a beach in Thailand for the next six months?

Fri, 11/04/2011 - 00:29 | 1844036 Mr. Lucky
Mr. Lucky's picture

I got bigger fish to fry.

Fri, 11/04/2011 - 01:21 | 1844114 merizobeach
merizobeach's picture

"maybe i should just buy now, and sit on a beach in Thailand for the next six months?"

 

Take out the 'maybe' and the question mark, and you've got your answer.

Thu, 11/03/2011 - 23:28 | 1843897 Never1
Never1's picture

You got a -1 and a +1.....

 

 

Someone just straddled your BTFD.

Thu, 11/03/2011 - 23:33 | 1843907 s2man
s2man's picture

I am waiting for TFD

Fri, 11/04/2011 - 07:27 | 1844308 Bolweevil
Bolweevil's picture

Great t-shirt

Fri, 11/04/2011 - 01:03 | 1844087 Ponzi Unit
Ponzi Unit's picture

dabolina sounds like a mean drunk.

Thu, 11/03/2011 - 22:32 | 1843791 stocksugg
stocksugg's picture

Jon Corzine hired prominent defense attorney Andrew Levander of Dechert LLP

 

The Wall Street Journal reported separately Thursday that MF GLobal Chief Executive Officer Jon Corzine, formerly governor of New Jersey and CEO of Goldman Sachs Group Inc. /quotes/zigman/188479/quotes/nls/gs GS +0.11% , has hired prominent defense attorney Andrew Levander of Dechert LLP to represent him if legal matters arise. The latter report cited unnamed people familiar with the matter

 

http://www.marketwatch.com/story/mf-global-may-have-hidden-debt-wsj-repo...

Thu, 11/03/2011 - 22:37 | 1843800 wisefool
wisefool's picture

Hopefully, he can use the enron defense "Hey, I was just a P.E. coach but I surrounded myself with smart people, like Nobel Laureate Paul Krugman"

SEC/DOJ. "Okay, well krugman is pretty smart, just dont do something like this again"

Thu, 11/03/2011 - 22:33 | 1843793 MK ultra
MK ultra's picture

Could someone please explain what the fuck all this means to a non-trader like myself?

(non-trader, but heavy into stacking and prepping)

Thu, 11/03/2011 - 22:37 | 1843799 Comay Mierda
Comay Mierda's picture

shit ----> fan

Thu, 11/03/2011 - 22:49 | 1843835 mfoste1
mfoste1's picture

nahh thats just bad luck hitting the fan

Fri, 11/04/2011 - 13:39 | 1843836 Jena
Jena's picture

fan ----> the rest of us, trying not to be the first one downwind

 

Some basic rules to remember:

1) Shit rolls downhill

2) Bears run faster and better uphill than they do downhill 

3) You only have to outrun the other guy (for awhile)

Thu, 11/03/2011 - 23:05 | 1843866 Careless Whisper
Careless Whisper's picture

press 2 for spanish

 

mierda ---->  ventilador

 

Thu, 11/03/2011 - 23:32 | 1843904 Schmuck Raker
Schmuck Raker's picture

The banks don't trust each other. Not good. Boom.

Fri, 11/04/2011 - 00:02 | 1843972 DeadFred
DeadFred's picture

The system needs flowing money the way your car needs it's coolant to flow. The banks and corporations aren't trusting each other so they're putting their money in safe places but then it can't move. Everything freezes up. Your car's gasoline may still burn but if the water pump is frozen tight the motor won't turn. It sucks if it's your car has it's coolant frozen but if everyone's car freezes the whole system stops dead. And as with a frozen engine block, it won't get better when it thaws because the the block is now cracked. Loans have been called in, margins weren't met, bankruptcies filed and CDSs activated. If the money stops flowing the system stops and will be really hard to fix afterward. Tyler is saying there are big crystals of ice forming similar to 2008 when it almost froze solid. How close are we? That's beyond my pay grade but it's dangerous stuff.

Fri, 11/04/2011 - 01:15 | 1844108 DoChenRollingBearing
DoChenRollingBearing's picture

+ 1

Gold and FRNs.

Fri, 11/04/2011 - 07:31 | 1844322 max2205
max2205's picture

Ice Nine has been an on going topic here for some time.

Thu, 11/03/2011 - 22:36 | 1843797 Lmo Mutton
Lmo Mutton's picture

Time to go long attorney fees.

Thu, 11/03/2011 - 23:02 | 1843861 jeff montanye
jeff montanye's picture

if legal matters arise.

Thu, 11/03/2011 - 22:36 | 1843798 socratesplus
socratesplus's picture

there is still bank liquidity in the eu.  institutions park cash with ecb, then ecb provides unlimited liquidity to banks.  ecb takes the funding risk is all.

Thu, 11/03/2011 - 22:39 | 1843802 TuesdayBen
TuesdayBen's picture

$40B? That's peanuts anymore. Hell, I hear some little old lady hit that on slots last week in Atlantic City

Fri, 11/04/2011 - 07:32 | 1844324 Bolweevil
Bolweevil's picture

Was she leveraged 40-1?

Thu, 11/03/2011 - 22:43 | 1843815 chump666
chump666's picture

Wow!  If that is the case, gold will be bid and equities will be toast. Looks like we have a liquidity/liquidation squeeze coming...and a major one.

Thu, 11/03/2011 - 23:13 | 1843874 sitenine
sitenine's picture

"It's not about liquidity, it's about access to credit", The Bernank

Thu, 11/03/2011 - 23:37 | 1843911 chump666
chump666's picture

Bernank is insane.

Thu, 11/03/2011 - 22:44 | 1843819 chump666
chump666's picture

EUR and risk FX are selling.  Maybe this news is filtering in.  Good stuff ZH

Thu, 11/03/2011 - 22:44 | 1843820 lizzy36
lizzy36's picture

So exactly where is the EUR1T for the EFSF going to come from?

Mars?

Thu, 11/03/2011 - 22:47 | 1843826 Terminus C
Terminus C's picture

Governments are going to tax solar radiation.  Just think, they'd get tax from everything... bullish for government revenue.

Thu, 11/03/2011 - 22:55 | 1843850 Jena
Jena's picture

Yep, in Riverside County, California, that is the plan:

http://www.mydesert.com/apps/pbcs.dll/article?AID=2011110230314

 

Whether it is a "fee" or a "tax" is under dispute but some in the county are determined to cash in on the many solar projects planned for the eastern part of the county.  If they actually get up and running, that is.

Thu, 11/03/2011 - 22:59 | 1843857 Terminus C
Terminus C's picture

I wasn't just talking about 'harvested' solar energy, I was talking about taxing daylight... consume food, well that used (x) amount of solar energy to grow, you pay (y) tax.  You have a tan? pay the tax... you get the idea ;)

It'll come right after they tax the air you breathe and the CO2 you exhale.

Thu, 11/03/2011 - 23:24 | 1843891 fnord88
fnord88's picture

Here in Oz, they are planning to start taxing my mum  for rain that falls on her farm, because it runs into a dam at the base of the property. We just got a c02 tax, soon to be applied to breathing.

Thu, 11/03/2011 - 23:34 | 1843908 Terminus C
Terminus C's picture

Taxing rainfall... that worked well in Bolivia.  As governments become more cash strapped they will become... more creative... in their revenue collection schemes, all in the name of protecting the environment (or some such thing) of course.

Time for this I think:

http://www.youtube.com/watch?v=QNzIKoAy2pk

 

Fri, 11/04/2011 - 00:22 | 1844020 ForTheWorld
ForTheWorld's picture

Which state government or local council is that? It sounds beyond absurd.

Fri, 11/04/2011 - 00:26 | 1844030 fnord88
fnord88's picture

South Australia. Google it. It has been mooted in Victoria as well I know, but since then lefty government has been kicked out and replaced with slighly less lefty, so who knows?

Thu, 11/03/2011 - 23:38 | 1843916 RmcAZ
Fri, 11/04/2011 - 13:38 | 1845852 Jena
Jena's picture

Ah, got it.  Short on George Hamilton, then.  And no wonder this is the weekend to set the clocks back.

Thu, 11/03/2011 - 22:55 | 1843848 DOT
DOT's picture

Some day an EU official will be walking through the park, and suddenly....there it is ! 

EUR 1T !

In cash.

The dutiful Bureaucrat will then deposit the funds. Crisis controlled.

Thu, 11/03/2011 - 23:06 | 1843869 island
island's picture

Can't they really just make it up?  In the end, the phantom financial economy is all a game -- the only thing that holds them back is their fear that the other guy/gal/bank/country will do the same.  The more corruption, the more likely it will be that some entity does exactly that - remember the $55B Euros "uncovered" by Germany a few days ago.  In the words of Nona Hendrix (LaBelle): "Who's watching the watcher?"  What you can be sure of: The fictitious numbers will serve the banksters and their governmental accomplices; the rest of us are of no interest to TPTB.

Thu, 11/03/2011 - 23:41 | 1843882 lineskis
lineskis's picture

From the perpetual debt servants Europe is building through the European Stability Mechanism (ESM), which will take over the EFSF. And EUR1T is just a start, it'll go till infinity and beyond...

Description of what it is from the EU itself:

http://ec.europa.eu/economy_finance/articles/financial_operations/2011-0...

Full text here:

http://consilium.europa.eu/media/1216793/esm%20treaty%20en.pdf

Best summed up here:

http://www.youtube.com/watch?&v=5CZr17HLH5U

European governments are giving away the soverignty of their coutries without even telling their people, in a way that makes the establishment of the FED looks like a democratic act... Priceless...

Sat, 11/05/2011 - 06:10 | 1848129 MSimon
MSimon's picture

Uranus

Thu, 11/03/2011 - 22:47 | 1843828 FutureShock
FutureShock's picture

The moral of the story is that the MF Global bankruptcy happened at the worst possible time. On one hand, European banks have been dumping tens of billions of US Treasurys, yet with the aftermath of this primary dealer bankruptcy, they have had to halt such sales and instead pledge USTs as collateral, thereby completely soaking up all incremental liquidity in the market

Ok wild conspiracy, Corzine sacrificed himself for the good of the Fed to avoid the Treasury sell off and keep inflation at bay and save the crash of American bank exposure should Reggie Middleton be right?

 

Thu, 11/03/2011 - 23:59 | 1843962 Mactheknife
Mactheknife's picture

>Corzine sacrificed himself

This planet you're from have a name?

>should Reggie Middleton be right?

Surely you jest.

Fri, 11/04/2011 - 01:16 | 1844110 nothing can go wrogn
nothing can go wrogn's picture

If you've been following the stalwart mainstream news agencies, Cortizene is a "victim" of the Euro debt crisis. Tough break for a hardworking trader, maybe he can sue Europe for damages or something?

They keep saying "Even though MF went under...his bets on Euro debt may have been right?"

Which makes me think that On a Long enough Timeline...

 

Thu, 11/03/2011 - 22:53 | 1843842 BlueStreet
BlueStreet's picture

MF has been slimy for years ever since they based out of the Caribbean.  That was a sign to pull your money out and move it elsewhere.  Sorry for those who still had money there but they shouldn't had.  

Thu, 11/03/2011 - 22:54 | 1843843 junkyardjack
junkyardjack's picture

I've been following these stories for a while but I still feel I'm missing something.  They are dumping treasuries and MBS' to get dollars I assume, what do they need the dollars for?

Thu, 11/03/2011 - 22:54 | 1843847 bob_dabolina
bob_dabolina's picture

.

Thu, 11/03/2011 - 22:56 | 1843851 Glass Steagall
Glass Steagall's picture

Even a water logged piece of flotsam would have looked “safe” to those floating in the ocean when the Titanic went down. And now they are all looking equally stressed.

Might have done better to have stayed in the grand ball room with their favorite bottle..

Thu, 11/03/2011 - 23:04 | 1843864 zorba THE GREEK
zorba THE GREEK's picture

Confidence is what the whole world fiat monetary system is built on, and the lack of

confidence is what brings about the swift collapse/bankruptcy of banks, businesses, and even countries.

The U.S.A. is technically bankrupt. If the U.S.A. was a company, with the overhanging debt it has and

the fact that it is spending 40% more each year than it is taking in, it would have had to file for bankruptcy

long ago. But the world is confident that the U.S.A. will pay it's debts (because it can print money at will)

and eventually get it's house in order, so it's business as usual and life goes on. The same goes for Japan,

Great Britain, and Europe, which the rest of the world believes the ECB will monetize the debts when all

else fails.

 

 

 

Thu, 11/03/2011 - 23:38 | 1843917 Schmuck Raker
Schmuck Raker's picture

The first two lines were ok, then you lost it.

Thu, 11/03/2011 - 23:06 | 1843868 Freebird
Freebird's picture

Catchy tune the fiddler plays

Thu, 11/03/2011 - 23:06 | 1843870 POTUS
POTUS's picture

Nice post Tyler...now we know what my friend Benny was referring to when he refernced some "bad luck" recently at his pres conference. Couple of my thoughts.. We know JC wasn't just plowing into all those short term piigs bonds sight unseen, no way, given the amount of ex-goldiesmrunning around over at MF, you know those positions were just mimicing what GS had on- only GS' positions are 30x bigger- oh boy. Also, makes sense that ex-goldie Draghi cut rates today, trying to give those shortnterm piigs bonds a little extra bid for his ex-colleagues.

Thu, 11/03/2011 - 23:12 | 1843875 chump666
chump666's picture

And we got the Chinese buying USD's (again) and selling CNY.

0305 GMT [Dow Jones] The USD/CNY hits its upside limit within minutes of the start of trading despite a second straight record-low USD/CNY fixing, as demand for dollars, partly for arbitrage interest, buoys the pair. Friday's central parity is set at 6.3165 from Thursday's 6.3198. In OTC trade, the USD/CNY stays put at its up-limit of 0.5% above the central parity at 6.3481 from 6.3514 late Thursday.

Thu, 11/03/2011 - 23:18 | 1843879 Atomizer
Atomizer's picture

I have full liquidity in my right pocket. Sometimes, it is necessary for me to be a drama queen to divert your attention. While you're looking at the car accident we featured on the morning  MSM news.. We shifted the funds to my left pocket. Winks

 

All the commotion undercuts the primary function of the government-- It's all build on failure and new reform too repeat the fleecing of taxpayers.  

The primary function of government is to pretend to? fail in order to succeed 

Perhaps too deep for some, others will understand.

Thu, 11/03/2011 - 23:23 | 1843890 Glass Steagall
Glass Steagall's picture

Haven’t the wheels already flown off this train?  The “government” you referred to is clearly no longer in control and flirts daily with military intervention at every hour.

No – I suppose the only fools left trying to play out this silly game are those that got in too late and are too vested to feel they could possibly lose anymore.  They are all in and are holding a bust hand.

Only trouble (for them) is, we already know it’s a bust hand.

Thu, 11/03/2011 - 23:51 | 1843938 Schmuck Raker
Schmuck Raker's picture

I'm sooooooo glad you're not a self-aggrandizing, elitist prig,

or I'd be tempted to junk you.

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