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Sentiment Crumbles On Relentless Euro Crisis, French, Italian And Spanish CDS Hit Records

Tyler Durden's picture


Despite Congress passing the debt ceiling hike, the market's reaction has been swift, brutal and vicious as ever more attention is being paid to Italy and the unforgiving European crisis. As both Spanish and Italian spreads hit new all time records, while CDS are at all time wides for the two countries plus France, the vigilantes are once again preparing to attack and test the ECB's resolve to keep the Euro alive: at this point it is obviously a losing game although expanding the EFSFS to $2 trillion is inevitable (at which point the reaction to German spreads will be swift). In the meantime the scramble for safety is at 2011 highs, with gold on the verge of another record, while the 10 Year US Treasury touching a low of 2.685%, and UK Gilts touching record lows: remember - this is all to make QE3 more palatable when it does begin. Lastly, Bloomberg's TJ Marta summarizes all the market indicators of a day in which sentiment has truly crumbled and in which we expect Italian bank stocks to be halted at least 3 times before market close.

From Bloomberg All News:

  • Italian and Spanish spreads widened to euro-era record levels and 10-yr gilt yields slumped to record low after recent PMIs added to concern the global recovery is faltering.
  • 10-yr gilt yield -3bps to 2.78%; hit 2.77%, lowest since at least 1989 when Bloomberg began collecting the data, on speculation of fresh QE or tax cuts to boost growth
  • European stocks fall to 10-month low, Swiss Franc rose to a record against the dollar; 5-yr CDS for France, Italy and Spain rise to records
  • Although no significant negative headlines overnight, price activity suggests that EU crisis is at imminent risk of worsening
  • Euribor/OIS spread +4.75bps, 2.7 std devs, to 38.6bps, high since Jan.; 1yr euro basis swap -5.6bps, -2.3 std devs, to -39.0bps, 3rd-lowest since Jan.; all other general risk indicators flashing red
  • Eurodollar interest rate future yields higher, sign of US$ funding stress
  • EU peripherals almost all wider, with significant moves for Belgium 2, 10yr, Italy 2yr; record wides for Belgium, Italy, Spain
  • Swiss franc outperforming all major currencies on risk aversion, new record low vs. euro; A$ underperforming after RBA held rates steady with dovish rhetoric
  • Barclays Cuts 3,000 Jobs as Investment Bank Profit Declines

All in all, expect continued selling until 11:30 when Europe closes, and the low volume US-based levitation machine takes over.


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Tue, 08/02/2011 - 07:14 | 1516078 Dismal Scientist
Dismal Scientist's picture

Volumes are pathetic, trading rooms are morbid and its eerily quiet. This is looking increasingly like 2008.

Tue, 08/02/2011 - 07:21 | 1516092 Sudden Debt
Sudden Debt's picture




The year Obama got elected for President...


Let's hope 2011/2012 ISN'T LIKE 2008 AT ALL!!

Tue, 08/02/2011 - 07:34 | 1516105 i-dog
i-dog's picture

It's no longer even worth commenting on this farce between the EU and the US.

End the Feds!! (Federal Reserve  &
End the European 'Experiment'!!

Tue, 08/02/2011 - 09:04 | 1516326 topcallingtroll
topcallingtroll's picture

The death of what has been derisively called anglo finance has been greatly exaggerated.

Italy and Spain and Spain are getting ready to jump without a parachute.


I generally don't advise that.  In this case I will make an exception.

Tue, 08/02/2011 - 07:16 | 1516079 Sudden Debt
Sudden Debt's picture



Van Rompuy said it best! = "I have no idea why the markets react like this"

Good to know we have our smartest and briggest idiots at the steering wheel...




Tue, 08/02/2011 - 08:30 | 1516192 Thomas
Thomas's picture

At least he is telling the truth.

Tue, 08/02/2011 - 08:45 | 1516226 heyligen
heyligen's picture

That is why there is so much dark matter lobbying behind the scenes to appoint them in an undemocratic way. Jeethner neighter has a clue. Dumb asses to steer the ship where dark forces want it to go.

Tue, 08/02/2011 - 07:17 | 1516083 Josephine29
Josephine29's picture

I think that there is a lot going on and it is easy to miss things. Here is a link to a thoughtful article which suggests that the rise of the Swiss Franc is causing trouble for the Euro project and Italy in particular.

The surge in the Swiss Franc is causing the latest problems for Italy via her weakened banks

It would appear that the Italian banks did plenty of Swiss Franc lending which may be returning to haunt them at these levels...


Tue, 08/02/2011 - 07:22 | 1516094 oogs66
oogs66's picture

Nothing like getting slapped around by some unintended consequences by our central planners :)

Tue, 08/02/2011 - 07:24 | 1516098 Sudden Debt
Sudden Debt's picture

just wait untill they back the swiss franc up by gold...

Tue, 08/02/2011 - 08:39 | 1516210 Ghordius
Ghordius's picture

Totally unnecessary. Folks, the truth is neither Gold or Swissie are going up much.

EVERYTHING ELSE IS GOING DOWN (some slower, some faster).

I expect the Swiss are going to debate to split their currency this fall, something similar like South Africa had (for the opposite reasons).

Tue, 08/02/2011 - 07:18 | 1516084 TSA Thug
TSA Thug's picture

Morning Frankness®

This one is dedicated to the gang.

"I get a kick out of you"

Tue, 08/02/2011 - 07:19 | 1516087 ZeroPower
ZeroPower's picture

the vigilantes are once again preparing to attack and test the ECB's resolve to keep the Euro alive

Disagree, we're keeping them honest.

Tue, 08/02/2011 - 07:34 | 1516101 Sudden Debt
Sudden Debt's picture

but it's not patriotic!

Patriots go down with the sinking ship!


Now was it Patriots or Parots....

Tue, 08/02/2011 - 07:20 | 1516089 Larry Darrell
Larry Darrell's picture

HSBC cuts 30,000

Barclays cuts 3,000

I'm both delighted that these financial voodoo institutions are decreasing in overall profitability and horrified to think that all of the power continues to concentrate in fewer and fewer hands.

Tue, 08/02/2011 - 07:35 | 1516110 Sudden Debt
Sudden Debt's picture

Don't worry! HSBC will hire 15,000 new once in Azia!


Tue, 08/02/2011 - 07:21 | 1516090 Gully Foyle
Gully Foyle's picture

Found this via

small dead animals

JP Morgan warned clients that Italy has a thin margin of safety and risks running out of cash to cover spending as soon as September. “Italy and Spain will run out of cash in September and February respectively, if they lose access to funding markets,” said the bank’s fixed income team of Pavan Wadhwa and Gianluca Salford. Worries about Italy’s immediate cash level risks leading to “a self-fulfilling negative spiral.”


Tue, 08/02/2011 - 07:36 | 1516112 Sudden Debt
Sudden Debt's picture



Don't worry!

AMERICA HAS 2.4 TRILLION TO SPEND! Obama will bail them out.

Tue, 08/02/2011 - 08:07 | 1516154 moneymutt
moneymutt's picture

You are a broken racist record obsess over Obama like he, and he alone, has led us into this mess. Get out of your own boxed up head sometime. Obama and Biden could disappear tomorrow, would we be better off with Boehner in charge, would have McCain with his lead adivsor Gramm been less of a tool to Wall Street? Was Paulson better than Geithner, did W try to fire Greenspan or Bernanke?

Tue, 08/02/2011 - 08:29 | 1516191 Ghordius
Ghordius's picture

Relax, moneymutt, he is an European taking poetic liberty.

Exchange Obama with US Authorities including the FED. He has no better opinion of Bush, if this easies your mind.

Tue, 08/02/2011 - 09:32 | 1516432 Lednbrass
Lednbrass's picture

Too much Hopium damages brain cells.

Tue, 08/02/2011 - 08:08 | 1516159 Pay Day Today
Pay Day Today's picture

Sure will, via GS and JP Morgue, to make sure that the banksters get a fat cut and that the people of Spain, Italy and Portugal get the shaft.

Tue, 08/02/2011 - 07:24 | 1516097 oogs66
oogs66's picture

The last bailout was less than 2 weeks ago had no details and had no realistic chance of stopping the inevitable slide

Tue, 08/02/2011 - 07:25 | 1516099 sangell
sangell's picture

and Italy drops out of the EFSF. Its like '10 Little Indians', they go one by one until there were none.

Tue, 08/02/2011 - 07:28 | 1516103 Quintus
Quintus's picture

Everybody knows there's only one Indian really in play.  I hope the Germans are feeling generous.

Tue, 08/02/2011 - 07:48 | 1516128 sangell
sangell's picture

True but Italy had been expected to provide around 15% of the EFSF funding for the PIG states. Each time a country drops by the wayside the Franco-German commitment grows larger even though the EFSF does not.

Tue, 08/02/2011 - 07:52 | 1516136 Quintus
Quintus's picture

If they were honest with themselves, I suspect France Spain and Italy all signed up for the EFSF without seriously expecting to ever having to contribute to it.

It's just another in a long line of clever French schemes to relieve the Germans of some more money.

Tue, 08/02/2011 - 08:32 | 1516195 Ghordius
Ghordius's picture

HA! Not even the Germans signed up with serious expectations.

No, it's all a (half-) clever scheme to withstand the CDS pressure bullshit.

Tue, 08/02/2011 - 07:26 | 1516100 Quintus
Quintus's picture

It's like an interminable play that never ends, but drags on repeating the same scene over and over in ever decreasing circles.

Just die already, you ridiculous Frankenstein's monster of a currency!

Tue, 08/02/2011 - 08:08 | 1516161 tim73
tim73's picture

Yeah, dollar must go!

Tue, 08/02/2011 - 08:14 | 1516165 Quintus
Quintus's picture

Yup.  Dollar's just as bad.

Tue, 08/02/2011 - 08:33 | 1516201 Ghordius
Ghordius's picture

I wonder how it is that so many people have something against the EUR.

Do you have any interest in it? Or betting against it? ;-)

Tue, 08/02/2011 - 09:00 | 1516312 Quintus
Quintus's picture

I regard the Euro as a weapon of the unelected and illegitimate proto-dictatorship that is being built in Brussels.  It also happens to be the weakest point of this unloved and unwanted bureaucracy.  The one area where Bullshit and undemocratic arm-twisting cannot achieve the outcome the Eurocrats desire.

As such, I want it to fulfill its manifest destiny and go to the great scrapyard in the sky where all previous similar attempts at cobbled together currency unions have ended up.

I hope that, by its failure, it will advance the rejection and fall of the entire EU Supra-State project.

Tue, 08/02/2011 - 09:42 | 1516468 Ghordius
Ghordius's picture

Hmmm... let me see...

Proto-Dictatorship in Brussels > Sounds like something I was reading on some Murdoch media...

Undemocratic arm-twisting... Eurocrats... EU Supra-State project...

compute... compute... result/guesstimate: you don't live in the Eurozone (77%), you are British (47%) and you have no clue about how Brussels functions (51%).

Is my analysis correct? ;-)

Tue, 08/02/2011 - 10:13 | 1516564 Quintus
Quintus's picture

"Undemocratic arm-twisting"

cf. Forcing Ireland to have multiple referendums until they produce the right result on the Lisbon Treaty.

cf. Ignoring the French and Dutch 'No' vote on the Lisbon Treaty, changing the name of the document but nothing else and then ramming it through without another public vote.

cf. Forcing Ireland to take a bailout they didn't want and fought against for the 'Good of the Union'

Sounds like undemocratic arm-twisting to me.


"EU Supra-State project"

I cannot conceive of how one could imagine an EU with it's own police force, anthem, diplomatic service, parliament, tax raising powers, foreign policy etc. to be anything else.

Now they are pushing for full transfer union and a central fiscal policy.

Sounds like a 'Supra-State' body to me.

Tue, 08/02/2011 - 11:35 | 1516774 Ghordius
Ghordius's picture

IMO the arm-twisting is not coming from the EU, it's coming from the specific Governments.

Forcing Ireland to have multiple referendums: not possible without the Irish Government & a majority of the Irish Parliament.

Forcing Ireland to take a bailout: the same. Bailing out Anglo-Irish: last government.

The EU & EuroZone seem to take a lot of heat from the GOVs, eh?


EU Supra-State Project: IMO this exists only in a few technocratic French heads and in the ENGLISH SPEAKING MEDIA.

Full trasfer union? Central fiscal policy? NO WAY. Why? The Govs are against it.

EuroBond & EuroTax? This is something the banksters are lobbying for. They would LOVE it. The churn! The fees!


IMO the best way to understand what the EU is: a Syndicate of Governments. And the ECB is a Syndicate of Central Banks.

In order to do any harm to a citizen, they have to get the respective Government on board. I prefer it this way, to be frank. 

Tue, 08/02/2011 - 09:47 | 1516481 Ghordius
Ghordius's picture

This is one of the things that baffles me: why should the currency union be the "weakest point of this unloved and unwanted bureaucracy"?

Technically, you could scrap the one without touching the other. They are designed this way.

The other currency unions? They were simple "let's have all precious metal coins in the same size & weight". You can't compare much!

Tue, 08/02/2011 - 10:06 | 1516540 Quintus
Quintus's picture

Technically, you could scrap the one without touching the other. They are designed this way.

Somebody better tell the Germans.  They seem to think that it is worth saving this ridiculous currency because it is essential to Europe.


"A Europe without the euro is unthinkable" - Angela Merkel July 22

Although I will grant you that hers is an interesting perspective since we have demonstrably had many thousands of years of Europe without the Euro.


Tue, 08/02/2011 - 11:32 | 1516804 Ghordius
Ghordius's picture

LOL! Yes, Merkel is talking a lot of BS, a prime requisite for the head of a Government! You see? If the Germans become angry at the situation, then they will vote for a coalition that perhaps takes Germany out of the Eurozone (without exiting the EU).

The Germans are pining the loss of their currency, they want a HARD currency. Some political circles in Germany are also seriously angry at the Irish Government for bailing out Anglo-Irish, by the way. That was something Ireland should NEVER have done. I hope the next cases will be handled better.

Tue, 08/02/2011 - 11:38 | 1516842 swissaustrian
swissaustrian's picture

The left (Die Linke) won´t do anything against the EUR-madness. They are to stupid and they´re internationalists.

The liberals (FDP) won´t either because they´re bought by the banking lobby.

Merkels CDU is under control by Mutti and Ackermann.

The social democrats (SPD) and the green party (Die Grünen) think that the Euro is some kind of a peace guarantee for the continent, therefore they won´t do anything. Additionally they are also clueless.

Right wing populists don´t have any real influence in germany for historical reasons. They are dumbheads as well.


If the true liberals aka libertarians would still exist in German politics they should be rebelling. But their party (FDP) is a corrupt piece of shit.

Tue, 08/02/2011 - 11:51 | 1516890 Ghordius
Ghordius's picture

Yes, it's sad how deep the German FDP has fallen from their ideals. And the Swiss FDP looks a bit anemic, at best...

A country like Germany with all those family-led "Mittelstand" medium-sized companies exporting all around the world would naturally have a "globalist" approach in many things.

Would you as Swiss advise the Germans to leave the Euro? What do you think about the CHF re. the future?

Tue, 08/02/2011 - 11:53 | 1516900 Ghordius
Ghordius's picture

Don't forget Schäuble! Merkel has a scientific background and no clue of economics, he is the one that is really in charge at the moment...

Tue, 08/02/2011 - 07:36 | 1516111 Die Weiße Rose
Die Weiße Rose's picture

crisis or no crisis, how can the Euro be that high against the US Dollar ?

Ridiculous, the Euro has got to come down a lot more,

even though Bernanke won't like it when the USD gains against the Euro !

Tue, 08/02/2011 - 11:30 | 1516818 Ghordius
Ghordius's picture

You might want to start looking the other way round: the EUR is not really gaining at all, the USD is falling. Or can you buy more CHF and Gold with your EUR?

Tue, 08/02/2011 - 07:38 | 1516113 Cassandra Syndrome
Cassandra Syndrome's picture

The Greaseball Stock Exchange is now down 26% since March

Tue, 08/02/2011 - 08:15 | 1516152 gwar5
gwar5's picture



The constant global drama flirting with economic armageddon is just letting TPTB stripmine economies while simultaneously wearing down the people into embracing a one world currency.


"If they were merely stupid, they would occasionally make a mistake in our favor." -- James Forrestal.

Tue, 08/02/2011 - 08:07 | 1516153 tim73
tim73's picture

Applying the same logic to USA, when Florida or California declares bankruptcy, dollar is finished?

Tue, 08/02/2011 - 08:21 | 1516173 Quintus
Quintus's picture

It would be if you overlook the small detail that the US is explicitly a transfer union where each state agrees to fund every other state in accordance with overall Federal goals.  Taxpayers in New York cannot refuse to pay Federal taxes that are then used to support California.

The Eurozone does not have this mechanism.  Taxpayers in Germany may (and do) feel they have no moral or legal obligation to support the Italians or Spanish.  If they express this in the voting booth, nobody can make them pay up.

That, my friend, is the difference between the EU and the US.

Tue, 08/02/2011 - 08:31 | 1516196 tim73
tim73's picture

Except most US states are equally or worse bankrupted than even the PIIGS and the "good" few states cannot possible save them all.

Tue, 08/02/2011 - 08:32 | 1516197 Herbert_guthrie
Herbert_guthrie's picture

Once you take into account the all-too-important influence of the "Central Bank", any other differences between the EU and US are insignificant.

Tue, 08/02/2011 - 08:39 | 1516209 Curtis LeMay
Curtis LeMay's picture

"...price activity suggests that EU crisis is at imminent risk of worsening"

This is wonderful news indeed. The despotic EU's main instrument of tyranny - the euro - must be crushed.

Go "vigilantes" go!


Tue, 08/02/2011 - 08:45 | 1516225 Ghordius
Ghordius's picture

So the EUR is crushing you with it's tyranny because it looks (at the moment) that the Eurozone will experience a classical depression while the US is going to experience a classical strong inflation.

Let me guess: you are heavily indebted in EUR? Otherwise I don't understand your point...

By the way, the Eurozone will most probably experience at least a part of that inflation...

Tue, 08/02/2011 - 10:15 | 1516555 Curtis LeMay
Curtis LeMay's picture


Nope. I have no personal or professional exposure to the euro.

Rather, the EU was created upon lies, perpetuated by despots, and propped up by the euro "elite" who openly admit that they lie on all sorts of things EU related. It also is and always has been undemocratic to its core and any entity that counts the destruction of European nations as progress must itself - and its instruments of tyranny like the euro - be done away with immediately.

The world has had more than enough of watching Europe trying to be united by hook, crook, or war. Efforts to do so have failed repeatedly, and for damn good reasons: it's the fucking wrong thing to even try to do.

Yet the power hungry euro politicians and their collaborators in big business never learn. Well, they are being taught the same lesson again, though this time there will be no bloodshed, thank God, but lots of bankers are going to lose their shirts and those same politicians will go home in disgrace and actually have to make an honest living for once in their lives...

Tue, 08/02/2011 - 12:08 | 1516943 Ghordius
Ghordius's picture

As pointed out above, I prefer an European "Confederation" (i.e. the states are free to leave) to an "Union". In this, the European Union has always been a misnomer.

Undemocratic? Perhaps. It has a smack of "Sovjet", in the sense that the 17 Governments are those who call the shots. As long as they are elected democratically (note that nearly all Governments in Europe are appointed by Parliamentary Majorities, so there you have another "undemocratic" element), it's fine for me.

For me it all boils down to this: does the UK have to join the EUR? No. Could Greece exit the EuroZone? Yes, they would find a way in an eyeblink. Do they want to? NO.

Does Texas have any of those options?

Another question: why is the English-speaking media so strongly against the EU? Really?

I do join you in the prayer that bankers learn that they too might lose their shorts. Politicians in disgrace? Oh, this is too much even to pray for!

Tue, 08/02/2011 - 14:38 | 1517586 Curtis LeMay
Curtis LeMay's picture

Fair enough, Ghorud.

Briefly, remember when Eastern Europe became free once again?

At the time, euro (and US) politicians were running around Eastern Europe telling the Poles, Czech's, Slovaks, Estonians, etc that "the way forward" for these countries was to join NATO...and the EU.

What is not well known, but I know for a fact (my family has longstanding political ties to the governments and officials of an Eastern European country), is that Eastern European officials were told that they will not be allowed to join NATO - unless they also joined the EU. This is fact.

I also know, and which is common knowledge, that the overwhelming majority of Eastern European people and governments wanted only to join NATO. Even more, if these governments were offered the choice of either joining NATO or the EU, all Eastern Europeans would have overwhelmingly chosen NATO membership over EU membership, given a choice.

I cannot speak for anyone but myself, but this blackmailing of the people of Eastern Europe is simply unforgivable. Moreover, who in their right mind would even want to join the EU under such circumstances? No one but spineless and blind sheep...

You asked whether "Texas have any of those options?". This is a 100% false choice.

Texas is a State, exactly in the same way Germany's Lander such as Baden-Wurttemburg, Bavaria, Saarland, etc are States. Texas is not a country; so please reset your perspective.

As for "why is the English-speaking media so strongly against the EU? Really?", that's easy. Britons (like Americans, Australians, etc) love their countries dearly and hold freedoms and the right of self-determination as sacrosanct.

Regarding politicians and "disgrace"...remember they work for us. We pay their salaries. What's unfortunate for Europeans is, however, that  Europeans elect parties (i.e. party lists). America does not. Americans elect people and there is a 100% certainty that if they don't like the  man or woman currently in office, that man or woman can be thrown out on the street in a heartbeat if the people wish it.

By the way, I have both US and EU passports; so I take no pleasure in pointing out the rampant fraud, heinous lies and terrible dangers the EU poses. What Brussels and the euro "elite" have done and continue to do - against the very will of the people of the nations of Europe - simply can no longer be tolerated. If it continues, Europeans will very soon suffer an economic collapse akin to the 1920's and 30's, and is that what Adenauer and de Gaulle had in mind all those yeas ago?


Tue, 08/02/2011 - 17:53 | 1518578 Ghordius
Ghordius's picture

I have to excuse myself for the snarky "Texas comparison" - I understand you really can't compare. It is also part of my point, we are talking about Sovereign Nations - and their club. I still have no opinion about why the Eastern where kept out of the NATO (except if they joined the EU?). Back then, there was a strong current of "What are the American promising? Who allowed them to promise any EU membership without asking us? Are they mad?!", meanwhile Moscow was not happy at all about the NATO "Encroachment". No, I definitely remember the groan as Poland was suddently a candidate - let's say not everybody was happy (me other story).

Britons love their countries, etc. and their Common Law Principles - which I like while I see them as one of the biggest issue in any Commonwealth or Union. The two law principles cause unending quarrels and misunderstandings. You see this with the Irish Crisis. This "which layer of government is doing what?" and "why is this all so complex" is driving them crazy - so far as that now suddently the ECB is the bad guy and the Irish Government is the good guy... I ask you, who bailed out Anglo-Irish and went broke? The ECB or the Irish Government?

As you mention, another divide between "Britons" and "Continentals", if you want, is the Voting System & Party/Parliament setup. Yours is crazy for our citizens and ours is crazy for yours. Your UK Constitution is the craziest & biggest achievement ever - by not existing at all (for Continental standards) and still functioning (perhaps even better then others?).

But I digress. It's a Club. As a member - a Sovereign Nation, you are supposed to behave the way you want the others to behave - as grown-ups. My point: the members are - de facto - the Governments, who are usually appointed by the Parliaments, who are elected by the Peoples. Note the plurals.

If you feel that the little debate-center in Brussels has any say if a sizable chunk of the Govs have a different idea, then you are confusing the staff of the Club with the Patrons/Members. I can understand that the media focuses on them - some of them are seriously ill - but please, we still have Diplomacy (which you seem to see too secretive - well, the media too!).

If you feel that those Govs don't behave as gentlemen should - "rampant fraud, heinous lies and terrible dangers that the EU poses", then you are complaining about the Governments of France, Germany, Italy, Spain, etc. You might not be alone, but up to a certain point you, as citizen of a Partecipant Nation should direct this anger to your Government, and work to get your Parliament and your Electorate to exit the club. Or to make a referendum. You have to change the course of a democracy.

No, I pass so often across the Channel and I seriously don't see any difference in quality of life, freedom, etc. Your Customs are awful and the Napoleonic laws behind our Police forces is awful, etc. I can't see what is exactly bugging you. We are different Nations and share some organisations. Me? I'd give Turkey immediate membership (soon they'll stop wanting it).

Tue, 08/02/2011 - 12:16 | 1516986 Die Weiße Rose
Die Weiße Rose's picture

Curtis LeMay  you are full of shit ! look at the world map you moron. Europe is better and bigger than the US and if your head wasn't stuck up your arse you would actually realize this reality. The days of the old british Empire are over and the last reminance of the old colonial power, the US is falling apart as we speak. In a few years they will come begging to join the Eurozone, which by then will include Russia and most of the European continent while you still try to borrow more Money from Japan and China just to pay the Interest on what you owe to the rest of the world. Watch out,Reality bites hard.The USA is so deep in Debt, they will need Generations to crawl out of it, and don't forget,americans are soft and spoilt,they are not used to doing it tough like the Japanese,the Russians or us Germans. I am German and I believe in a united Europe and I can not wait until the Euro takes over as the World Reserve  currency from the worthless and bankrupt crap you call US Dollar. America as I see it,is both morally and financially bankrupt and it is only a matter of time until the world will no longer put up with this endless Bullshit that America has been serving up over the last few decades...

Everytime those rigged US Market of yours tank I can't help but smile...because your loss is my gain ;)


Tue, 08/02/2011 - 13:24 | 1517345 Use of Weapons
Use of Weapons's picture

I'd manufacture some Panzers before getting too high on your own supply there, Mr Kraut.



I'm actually interested in Estonia - apparently has the best GPD / debt ratio in Europe, and it has beautiful people & architecture (avoided all the bombing).

Tue, 08/02/2011 - 08:58 | 1516302 BlackholeDivestment
BlackholeDivestment's picture

...we are all kids of the black hole now.


Tue, 08/02/2011 - 09:49 | 1516491 Snidley Whipsnae
Snidley Whipsnae's picture

What is little understood is that Germany is on the verge of acheiving by economic manipulation what it could not achieve by two world wars.

The ESFS is little different than the 'treasury' function in the US system...Except that those wanting to access ESFS funds must submit to German fiscal 'oversight' of those wishing to borrow. IOWs, if you are Italy and want to borrow cheaply from the EFSF you have to play by rules set down by Germany.

...and, if the 'bond vigilanties' take on the German banks they will probably find that they are facing off against the Chinese buying up German (ESFS) debt.

Another oft overlooked item here is the structure of the Euro Currency. The ECB balance sheet revalues their gold holdings quarterly, which makes the Euro light years ahead of the US that still values it's gold at ~ $44 per oz... Think about it.

Tue, 08/02/2011 - 10:16 | 1516580 Dismal Scientist
Dismal Scientist's picture

Its little understood if you're in the US. If you're in Europe, then its been obvious for a while, sunshine.

Tue, 08/02/2011 - 13:26 | 1517356 Use of Weapons
Use of Weapons's picture

Aye, 'Book price' has been mentioned a few times by some posters...

Tue, 08/02/2011 - 10:20 | 1516597 Quincy
Quincy's picture

Anybody know why the euro and Italian/Spanish bonds have all bounced? Nothing in the newsfeed ...

Wed, 09/14/2011 - 04:33 | 1667296 chinawholesaler
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Wholesale Stapler
Wholesale Ruler
Wholesale Flashlight

Eye Mask

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