Schauble Wants ESM To Be Used Over EFSF For Spanish Bailout

Tyler Durden's picture

... And what Germany wants, Germany gets. Sorry Spanish bondholders.

From Bloomberg

German Finance Minister Wolfgang Schaeuble wants aid for Spain’s banks to come from the future permanent backstop, the European Stability Mechanism, to avoid greater risks for the German budget, Handelsblatt said.


Spain would not be able to guarantee loans from the current backstop, the European Financial Stability Facility, if funds for its banks came from the EFSF, the newspaper said, citing European Union diplomats it didn’t name.


Germany’s share of guarantees to the EFSF would rise in such an event, the newspaper said. The ESM is financed by all 17 euro-region countries, including those that receive funds from it, the newspaper said.

Recall earlier the European Commission (of laughable clowns who get financial advice from JT Marlin?) scrambled to say the Spanish bailout would take place under the EFSF, not ESM, to avoid the whole subordination trigger issue. Oh well.

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BeetleBailey's picture

Zee ESM - dumkopfs....Danka!

slaughterer's picture

I heard the Brussels office of JT Marlin is quite successful these days.    

No Euros please we're British's picture

Have they opened a catering division?

Chief KnocAHoma's picture

Just last month our start up company launched an exciting new product to raging success. We are now the World's best guillotine manufacturing company. Demand for our product has been extremely high and largely well received except for one product defect.

Our original model was intended to kill bankers slowly, with a great deal of pain. The jagged edge blade was intended to only partially cut off the offender's head on the initial drop. This feature was intended to allow the executioner the opportunity to retract the blade, leaving the offender writhing and wailing in pain.

Unfortunately, there have been reports of our product lopping off skulls on the first drop, thus leaving crowds disappointed. These mobs want a justice equal to the pain they have suffered, not quick painless retribution. For this defect our company offers a sincere apology.

We recommend, in the future, switch men drop the blade from lower heights, or simply email us and we will send you free of charge two rusty and dull axes which can be used to remove the feet of your scumbag banker right before the crowd drags him to the stage.

And again, thank you for your business.


Chris Jusset's picture

So who's running the show?  Are there even two Euro central bankers that agree on the same thing?


Whenever these bozos decide to leave central banking, they will assuredly have jobs offered them as clowns in a circus.

Temporalist's picture

All my investment is now with PT Barnum.

When PT Barnum speaks...the show must go on.

canardo's picture

Still looking for that egress ...

slewie the pi-rat's picture

they may have access to unnamed diplo-mats like schaeuble (with the 'e') himself

this is what the finiMinis do and herrS is right out there leading the confusion, again! 

the real action is possibly with the committee headed by marioECB which will have a banksters' plan ready by the 20th;  this plan, which will cause all germany to shit like a goose at once, will be approved b/c angela will again demurely refuse to be the uber who tosses the EU out with the rest of the bathwater, where it belongs

tempo's picture

I bet the UK is SO glad they are not party of the EU joke.

Silver Alert's picture

The UK has their own comedy show.

GCT's picture

And the Beat Goes On!  You just cannot make this stuff up anymore. 

CrashisOptimistic's picture

Guys, I was excited to see red this morning too after watching the futs +1% last night, but you are all once again forgetting the Great Lesson of 2011.

They will do ANYTHING to keep the wheels turning.

This analysis of subordination and what it does to spreads . . . no.  They can stop this.  They can buy up all the bonds.  They could declare the relevant passages of the legislation null and void and declare no subordination (until they reverse later).  They can put a bullet in Syriza's lead guy.  They can send out firing squads and mow down the line outside banks doing the bank run.  There Are No Rules.

You have simply got to stop thinking this situation is amenable to analysis.  It's not.  There is no calculating anything anymore.

FlyoverCountrySchmuck's picture

At LEAST until Nov 6, 2012.

If Obama wins, the day after the election the US Treasury is open for all, for worldwide bailouts.

CrashisOptimistic's picture

No it isn't.  Congress has to appropriate that money.  There is no TARP slush fund.  It expired.

The Fed might be able to do something, but I doubt it.  They have explicit legal restraints too.

Now, all legal restraints can be dissolved, but that would require GOP majorities in Congress to agree -- and they might.

pleseus's picture

Too many holes in the dam.  This sucker is gonna give way.

trebuchet's picture

this one really has that feeling  - have never been so concerned about the loose ends that just getting looser


italy cds racking up, cyprus out of the woodwork, moral hazard play on full view - Germany vs the rest, all EU on watch negative, macro economy going down, CBankers like posen admitting QE hasnt worked and it needs to go direct to real economy....

why was spain deal talked about this weekend and not in June after elections and full bank assessment?

Coz its a Solvency NOT liquidity issue............................................


And the EFSF/ESM is NOT solvent either, so deckchairs moving aroudn the titanic.  



Temporalist's picture

Not to worry.  The kleptocrats on TV are smiling and the public feels at ease because of it.  Everything must be fine.

trebuchet's picture

thats what makes it even more worrying!!  Coz while your post was im sure intended to be ironic, the sad fact is its true.... 


and when the mob turns, there is true panic on the streets

Tyler Durden's picture

The ESM was SIGNED on February 2, 2012

Done at Brussels on the second day of February in the
year two thousand and twelve in a single original, whose Dutch,
English, Estonian, Finnish, French, German, Greek, Irish, Italian,
Maltese, Portuguese, Slovak, Slovenian, Spanish and Swedish texts are
equally authentic, which shall be deposited in the archives of the
Depositary which shall transmit a duly certified copy to each of the
Contracting Parties.


1. This Treaty shall be subject to ratification, approval or acceptance by the signatories. Instruments of ratification, approval or acceptance shall be deposited with the Depositary

Ratification does not = signed.

No loophole.

See page 60 of 62

Bazza McKenzie's picture

"The ESM is financed by all 17 euro-region countries, including those that receive funds from it".  So Spain is to bailout Spain!

Dr. Engali's picture

So has everybody had a chance to see Madonna's nipple?

LULZBank's picture

Nopes .. do you have a link.

Fuck Europe. This is serious business!

bigdumbnugly's picture

hard to believe over the years anyone hasn't so i think she must've done that for the few out there that recently had their sight miraculously restored.

and those few now probably think sight is overrated.

Ookspay's picture

I could barely make it out, too many cobwebs.

LULZBank's picture

And it probably has more lines than Deutsche Bahn!

GeneMarchbanks's picture

Schauble... an old dog.

noses's picture

Remember? He's the guy Germany is attributing miracles to. "Schäuble is living proof that you are able to trample around on the German constitution even if you are sitting in a wheel chair." If he can do *taht* he'll be able to do even more interesting things.

mayhem_korner's picture



This charade of alphabet soup for braggin rights is laughable.  In the end, it will all get subordinated to physical assets. 

dracos_ghost's picture

Well the only one left is DOA.

dingoj's picture

An ESM subordination save? A bit over my head, so fuck you Bernanke!

Tyler Durden's picture

The ESM was SIGNED on February 2, 2012

Done at Brussels on the second day of February in the year two thousand and twelve in a single original, whose Dutch, English, Estonian, Finnish, French, German, Greek, Irish, Italian, Maltese, Portuguese, Slovak, Slovenian, Spanish and Swedish texts are equally authentic, which shall be deposited in the archives of the Depositary which shall transmit a duly certified copy to each of the Contracting Parties.

Ratification does not = Signed.

No loophole.

See page 60 of 62

slewie the pi-rat's picture

 <--< troll alert?

 < --< there is no money?  this ESM won't hunt?  we were warned?  everybody is lying?  the finiMinis couldn't get a cab?  angela's clothes are at the cleaners?

what (if anything other than a fresh cocktail) is tyler up to here? 

EscapeKey's picture

Another one bites the dust

Bank of Spain deputy governor Aríztegui resigns

LULZBank's picture

In my country there is a saying "Getting a blind man to fuck you and then escorting him back to his place too."

financial apocalyptic contagion's picture

what a bunch of retards

wish Stewart and Colbert covered financial news of this sort, there won't be any shortage of material and plenty of Herman Cains to chose from

FlyoverCountrySchmuck's picture


The Big Bankers are only Republicans in Hollywood Movies. You don't get invited to those fancy-dress DC and Manhattan parties if you have an R after your name.

IN REAL LIFE, the Big Bankers own the Socialists and Democrats (easier and cheaper to buy), and have funded them for decades.

Darth Hayek's picture

Heh.  You can only stick one person with all the bills for so long before they walk.

Forget math, these idiots fail at human nature.  The reckoning, it's a-coming.

holdbuysell's picture

How the markets give any credibility to these jokers is unconscionable.

That is the true miracle in all this.

PaperBear's picture

Use this piece of s**t over this other piece of s**t, doesn't really matter. It's all going down.

booboo's picture

I am beginning to think these clowns just waddle from one global confrence buffet to another with their Staples "Easy" button thinking that it is a real device like the Nuclear Codes kept safe in a super secure briefcase.

Dr. Engali's picture

I see they have been upgraded to clowns from ass clowns on a previous thread.

Temporalist's picture

I'm sure everyone is agreeable to the bailouts and this has been contained...


Spanish Bailout Can’t Go to Unhealthy Banks, Finland Says


Italy Moves Into Debt-Crisis Crosshairs After Spain

asteroids's picture

My banker is better than your banker. I want my banker to subordinate your banker.

LULZBank's picture

ESM prints better notes than EFSF.

JR's picture

"The poorest man may in his cottage bid defiance to all the force of the crown. It may be frail; its roof may shake; the wind may blow through it; the storms may enter; the rain may enter--but the King of England cannot enter; all his forces dare not cross the threshold of the ruined tenement." -- William Pitt, Earl of Chatham

 “The wind and rain may enter the cottage of the most humble Englishman,” the proverb went, “but the King with all his might and majesty may not.”

The final frontier for the onslaught of big-banker stealing was the threshold of America’s and Europe’s homes. The savings and product of Americans' and Europeans’ livelihoods, which is held in their very homes, was just too tempting for these bankers to resist and they moved in to take it.

Therefore, let those who made the profits from the real estate bubbles that destroyed people’s home equity and savings, those who are now stealing depositors’ savings to re-inflate their quadrillion dollar derivatives bubble, i.e., the bankers who created this crisis, pay the losses.

The bankers who operate this worldwide financial system went gone too far when they have put into their pockets the very proceeds of a man’s home equity, life savings, and future…just to satisfy their greed. And, in the current chaos they created, are acting as crazed animals.

We need, finally, to put the levers that control the financial system into the hands of the people and to slap the hands that are in the till and fit them with handcuffs,

They are not bankers; they are robbers.