"A Panorama Of The European Debt System" - The Definitive Primer Of The Eurozone

Tyler Durden's picture

Morgan Stanley has released "A panorama of the European Debt system" - easily the most comprehensive summary analysis (in 83 pages) of the Eurozone. To wit from the authors: "In this primer, we have compiled the key background information and statistics relevant to the context in which the European debt markets operate, encompassing Europe’s Institutional Framework, the ECB and the banking system, as well as sovereign, corporate and household debt, both in aggregate and by country. The compilation reflects the most frequently asked questions our economics and strategy teams receive from clients globally." Anyone who has ever had questions or been generaly curious about the uber-dysfuctional European debt system, and that would be everyone, especially the ECB, must read this document, if nothing else for the plethora of pretty charts.


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GeneMarchbanks's picture


Frog-And-Toad's picture

Was thinking about shorting the Dollar, (thinking not going to) as I believe it's the US turn to play the "we're ruined" card.  Thoughts?

sqz's picture

How come ZH not talking about this EU Commission Financial Tax?



It sure seems to have got the UK/City of London in jitters.

spiral_eyes's picture

I'm coming to believe that the Euro bailout will not mainly come from Germany, nor Trichet, nor China.

I think it might at least partially come from the Ben Bernank.


falak pema's picture

merkel-timmy tug of war. Oligarchs from Anglo and Euro groups fight it out squabbling over how to share the pain/ protect their own banks from maxi haircuts. 

Restcase's picture

Gold is not backed by any government! Man that is reporting at its most incisive!

I'm scared of assets not backed by any government!

Or maybe not.

Back to you, Brigit.

falak pema's picture

I posted on this yesterday. 

re :

1° Siemens hates the french for having being snubbed by Sarkozy (Alsthom/Areva deals where it was marginalised in France).

2° Lloyds in going John Bull. City is now dead against the Tobin Tax that EUroland will promulgate. EU is going to push hard regulation of shadow banking that is totally unregulated in WS  and the City hates that. Lloyds is expressing concerns about this trend. 

3° China stopped FX swaps, because somebody (FED/Timmy)  told them that they needed their help to scare the shits out of EU for not going whole hog on EFSF. ( USD Swap lines were momentarily tightened). Timmy has owned up to this caper now.

4° China keeps buying US treasuries. Same reasons as 3°. It pressures EU. China needs EFSF full blown as it helps kick the can on a global level...

5°  German reticence on EFSF : Continuing psy-war between Anglo and Euro Oligarchs. Merkel is still dithering.


IN WHICH CASE THAT TRADER ON BBC IS RIGHT : BOTH EU AND US CAPITALISM ARE DEAD.  GS rules the world to rocky bottom as it all burns to hell. 

Or else, EU can still survive and avoid the fate of WS. But this is up in the air : As...

We don't know how bad the true situation is in EU. France, Italy and Spain are unknowns. But its looking terrible based on what is visible, the dominos are all lined up....as even Greece can bring the banks down. 

Tuffmug's picture

Whole "crisis" is a giant con game by the EU. They have milked this for years now to try and get US, IMF, China, and even the other BRIC countries to pony up the money to pay off the debts from their disfunctional currency union. It's like when Cleavon Little in Blazing Saddles puts a gun to his head and threatening to shoot the "hostage??".

Tyler Durden's picture

Because it is merely a populist anger control tool which will never pass.

snowball777's picture

Ding! (pssst...don't tell em...it keeps em off the street and online)

GeneMarchbanks's picture

Take a look at that bond market. Thoughts? You want my sincere advice? Keep looking over here(Eurozone) until at least November then maybe the Yanks start their bullshit again. Bama seems determined to campaign hard so maybe the US looks good for a while who knows...

Deadpool's picture

short it by buying gold and silver. with so much money running and hiding in the world the flight to perceived quality will blow the dollar up for short periods of time while it's 100 year trajectory continues down. too risky.

Frog-And-Toad's picture

Yeah I definately agree that it's way to risky right now, because the market is going crazy on any rumor...


I won't be taking any position, but I was just curious of what other people who see the collapse coming thought...


It's all a big play, and I think the Euros have had their prolonged spotlight, and now it's time for someone else to play along... 

Whalley World's picture

Gartman was just on BNN, said get out of gold.  With his track record in the PM's its time to load the boat!

Al Huxley's picture

He's probably saying get out because he needs sellers to buy from.


There is No Spoon's picture

In the current environment, the U.S. "we're ruined" card means a stronger dollar because the "we're not ruined" card is simply printing money/debasing the dollar in some way to inflate away our debt and juice economic data. Also I don't think Europe's turn is over yet, nor will it be over until the Euro drops much more, at least breaking last year's lows.

snowball777's picture

Buck O'Nine...bank on it.

What we gonna read tommorow?
Something that we see today
Guns and tears and sorrows
What will the headlines read today?

DollarDive's picture

Morgan Stanley should be saving paper for the Federal Reserve.  Greenbacks - what a waste of bytes.

jdelano's picture

How many times have I seen this phrase "officials race to put in place measures that cordon off Greece" 

and thought to myself, "Race?  Really?"  Race.  Like a one-legged, headless chicken.  

Cheesy Bastard's picture

Now I got chart porn and pop corn. 

DCFusor's picture

Really, didn't have to watch the whole thing even.  A really good one.

mynhair's picture

- yawn -

Wake me again on the collapse.

My lead isn't getting any younger, ya know?

TN Jed's picture

83 pages?  Let me sum up:


Back and forth. Forever.

walküre's picture

None of this matters.

What matters is how German representatives vote tomorrow. If they vote "yes" to support the ponzi at German taxpayer's expense, the show will go on until it won't. If they vote "no" then the world will still turn, the sun will rise in the East and set in the West but life as we know it will be a bit upside down! The FED potentially announces a form of QE in their October 4th announcement to try and stem the tide.

However it is guaranteed that Greece goes BK immediately, Italy will be pushed towards it and the rest of the dominos will fall as well. Possibly the end of the EZ and the Euro. Those are realistic consequences.

Angela Merkel would probably asked to resign (Misstrauensvotum) the next day as Parliament will establish that she no longer holds the majority vote. She may resign anyway and not wait for the Misstrauensvotum.

This vote is crucial to her political survival.


Donnerstag, 29. September

Euro-Stabilisierungsmechanismus: Zu Beginn der Sitzung um 9 Uhr steht ein Gesetzentwurf der Koalitionsfraktionen, der die Ausweitung der deutschen Beteiligung am Euro-Stabilisierungsfonds EFSF vorsieht (17/6916, 17/7067, 17/7130) auf der Tagesordnung. Nach dem Willen von CDU/CSU- und FDP-Fraktion soll der deutsche Anteil an Kreditbürgschaften für überschuldete Euro-Mitgliedstaaten von bisher 123 Milliarden auf 211 Milliarden Euro steigen. Über die Vorlage stimmen die Abgeordneten im Anschluss an die zweistündige Debatte namentlich ab. Diskutiert wird auch über die Rechte des Parlamentes im Zusammenhang mit Entscheidungen im Rahmen des EFSF. Unions- und FDP-Fraktion fordern in einem Antrag (17/6945, 17/7067, 17/7130), dass die Bundesregierung bei Entscheidungen, die zu einer Übernahme oder Veränderungen von Gewährleistungen im Rahmen des Gesetzes zur Übernahme von Gewährleistungen im Rahmen eines europäischen Stabilisierungsmechanismus führen, die vorherigen Zustimmung des Deutschen Bundestages einholen muss. SPD (17/7175), Die Linke (17/1769, Die Linke: 17/1968, Grüne: 17/2922), die sich gegen die Ausweitung von befristeten Arbeitsverhältnissen wenden. Dazu wollen die Fraktionen das Teilzeit- und Befristungsgesetz dahingehend ändern, dass sachgrundlose Befristungen nicht mehr möglich sein sollen. Die Abstimmung über die Beschlussempfehlung des Ausschusses für Arbeit und Soziales (17/4180) folgt im Anschluss an die 90-minütige Debatte.



The Pope visited Germany last week and he addressed Parliament. Maybe that makes a difference.

sqz's picture

You mean the former Hitler Youth member returned to his homeland to find that most Germans did not want him there, did not care that he was there and even managed to raise several thousand protesters outside the half-empty Bundestag that he addressed? You mean that Pope?

I hope Germans have better sense than this come tomorrow ...

fxrxexexdxoxmx's picture

I watched a few broadcasts during the Popes recent visit to Germany. There were thousands of people in attendance and they were not protesting. I was suprised to see Merkle listing to him. No doubt he has detractors but the Pope is popular in Germany. Go figure, I spent 2 years in Germany in late 80's and found it hard to understand what Germans really think. Odd ducks but extremly intelligent although they do have a penchant to group. Not belonging to a self identified group, no matter how stange, is deemed odd by others.

Big Ben's picture

The fact that the Greece extension is touch-and-go means that any larger infusions from Germany are definitely out. So my guess is that the Greek funds get approved, everyone celebrates, disaster averted, market rallies, etc. Then over the next couple of months pressure starts to build on Italy and Spain. But Germany isn't going to commit any more funds until disaster is looming at the doorstep. Halloween could be really scary this year.

walküre's picture

Well, then there's that October 4th deadline we're working towards!

economicfreefall's picture

During the Great Depression of the 1930's there was deflation and deleveraging, and thousands of banks had to close down their businesses. Almost a third of the American population was unemployed, but prices dropped, so for the vast majority who still worked, the standard of living went up. The unlucky ones who didn't have a job could at least make due a bit longer as their savings purchased more.

Fast-forward to the current crisis and you have a huge debt bubble trying to deflate and real unemployment already north of 22%. But instead of letting the reset of the economy to run its course, we have politicians and central bankers flooding the system with even more money and debt (what's the difference anyway?). Instead of the rising salaries and savings of the 1930's as prices dropped, we're stuck in an environment where wages buy less and savings buy little. Simply put: almost everyone's standard of living is in decline.

Why on earth do people want inflation so badly, especially during hard times?


walküre's picture

People don't want inflation. The bankers want inflation as their income derives from capital expansion.

Big banks are now going after the midstream funding to make their fees. It's carnage out there, absolute carnage I tell ya!

economicfreefall's picture

No, seriously, people do want inflation. Just ask around, average people are really scared of deflation. They see stocks fall and think it will devastate their lives, even though most have very little in the stock market.

Normally banks would endorse deflation, since it makes their lent money rising in value. Problem now though is that everyone is broke and wouldn't be able to pay the loans back.

HCSKnight's picture

One big difference between the GD period and now is the "Social Safety Net" that now exists.

Which is wealth transfer parading as charity.

myne's picture

Because Bernanke want's to relive every single 20th century depression and recession one after the other.

First 1929, then 1974, then 1987, then 1981, then 1999.


His legacy will be as the catalyst of an entirely new economic theory that will revolutionise the world. Anti-Bernakeism.

Infamy ain't so bad. Hardly anyone studies good king Wenceslas, but everyone knows Atilla the Hun.

Rainman's picture

The whole Eurozone economic system is held together by a Memorandum of Understanding, the most worthless collection of words scribbled on papyrus and stuffed into a file. No surprises here. They will eventually go to battle with each other .....AGAIN.....over debts and territory. 

unum mountaineer's picture

hahaha, that everywhere though. when things get serious everybody bends the truth a lil...

djsmps's picture

According to the POTUS, who is running for election, current US economic problems are caused by Europe.


MaximusR's picture

ECB, FED, and BOJ independent from the political influence?? yah right!!

kito's picture

Morgan stanley presenting an analysis on how they themselves will DIE

mvsjcl's picture

Sort of O/T. Current Yahoooooooo headline: Dow Drops 180 Points as 4-Day Winning Streak Skids-. Did the DOW actually have a 4-day winning streak prior to today?

fdisk's picture

yeah, GOLD collapsing, bitchez.. Bubble got burst..

Fasten your seat bells

AldoHux_IV's picture

I can't believe these countries ever agreed to such a union in the first place-- it's (lack for a better term) a cluster fuck of institutions that go to mask the real scam: own Europe by debt. The current form doesn't make sense nor does continuing the current system with more fiscal unity-- economies of scale aren't good enough to lose one's sovereignty, liberty, and ability to provide prosperity for one's self.