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SNB Refuses To Identify Bank Using FX Swaps, Says "Repo Already Unwound"

Tyler Durden's picture




 

More on the biggest market moving story from last night. According to a blast from Bloomberg, minutes ago SNB spokesman Werner Abegg announced that a bank sought USD through the SNB FX swap with the FRBNY, via a repo operation. Abegg added that the repo has already been unwound. But, but, it was only $200 million so what's the big deal? There is no stigmata to micro amounts... Oh wait there is stigmata to any amounts. And sorry, this is just the first of many times that not only the SNB but all other central banks will very soon be scrambling to the Fed to bail out their dollar collateral short banks. Unfortunately, the 2008 redux is only just starting.

 

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Fri, 08/19/2011 - 08:55 | 1576621 slaughterer
slaughterer's picture

Swiss confidentiality at its best.

Fri, 08/19/2011 - 09:08 | 1576632 TheTmfreak
TheTmfreak's picture

They kept the jig up long enough for everyone to think they're a safe haven asset.

Fri, 08/19/2011 - 09:59 | 1576929 TheFourthStooge-ing
TheFourthStooge-ing's picture

Officer Barbrady: Move along people, there's nothing to see here.

 

Fri, 08/19/2011 - 09:17 | 1576724 OpenEyes
OpenEyes's picture

The Swiss do NOT talk about Fight Club!

Fri, 08/19/2011 - 11:08 | 1577347 Overflow-admin
Overflow-admin's picture

 

 

 

  1. The Swiss don't ask questions.
  2. The Swiss don't ask questions.
  3. No excuses.
  4. No lies.
  5. The Swiss have to trust Tyler.
Fri, 08/19/2011 - 08:56 | 1576629 ZeroPower
ZeroPower's picture

Well if the repo has indeed already been unwound, that actually is good news. Still no excuse for needing that overnight capital though..

Fri, 08/19/2011 - 09:25 | 1576759 NotApplicable
NotApplicable's picture

So they squared the books for a day. What about tonight?

Fri, 08/19/2011 - 09:00 | 1576630 dwdollar
dwdollar's picture

Well I guess it's not that critical then...  so why would it hurt to name the bank?  Oh wait, it probably is critical and they are playing cover-up like usual.

Fri, 08/19/2011 - 08:56 | 1576631 firstdivision
firstdivision's picture

Wait a sec.  Didn't they say earlier that SNB did not access the FX Swap line?

Fri, 08/19/2011 - 08:58 | 1576644 the not so migh...
the not so mighty maximiza's picture

i hate these central banker guys

Fri, 08/19/2011 - 09:00 | 1576649 Iriestx
Iriestx's picture

This must be more of the transparency that Obama promised.

Fri, 08/19/2011 - 09:00 | 1576650 hugovanderbubble
hugovanderbubble's picture

Credit Suisse-------------------------------SocgEn...........................BAC---------------------------------

 

Just look the Credit suisse 2 yrs CDS...No comments.

Fri, 08/19/2011 - 09:01 | 1576652 zorba THE GREEK
zorba THE GREEK's picture

I think that once the SNB bluffed about pegging to the Euro, they have lost all credibility.

Fri, 08/19/2011 - 09:02 | 1576658 eigenvalue
eigenvalue's picture

Then it is Crap Suisse? Crap Suisse has an even lower tangible common equity ratio than Ugly BullShit does. 

Fri, 08/19/2011 - 09:04 | 1576666 somethingelse
somethingelse's picture

who knew the "change we can believe in"  was FX swaps   

Fri, 08/19/2011 - 09:06 | 1576674 ZippyDooDah
ZippyDooDah's picture

Obama has certainly changed what I used to believe in.  Maybe that's what he meant.

Fri, 08/19/2011 - 09:05 | 1576671 gwar5
gwar5's picture

 

Well, at least they're not denying it at this point. For them, that's a big first step.

 

Fri, 08/19/2011 - 09:08 | 1576679 lizzy36
lizzy36's picture

2008 2.0.

Now that is change you can believe in.

I love the smell of a new server and a redux in the morning.

Fri, 08/19/2011 - 09:09 | 1576682 Karl Napp
Karl Napp's picture

In one German blog the Swiss bank was named as Hypothekarbank Lenzburg, a medium sized regional bank (CHF 4 bln balance sheet total).

Fri, 08/19/2011 - 13:29 | 1578040 Lazlo Toth
Lazlo Toth's picture

Gesundheit

Fri, 08/19/2011 - 09:09 | 1576683 Fix It Again Timmy
Fix It Again Timmy's picture

Things are FX'D UP - you can bank on it!

Fri, 08/19/2011 - 09:10 | 1576691 ViewfromUnderth...
ViewfromUndertheBridge's picture

In 2008 banks would run small amounts, say $5m, just to test that the swaps system worked...this was just a test, but a leap in the de minimis quantum to reflect the great unwind redux of 2011. 

Fri, 08/19/2011 - 09:13 | 1576702 SheepDog-One
SheepDog-One's picture

Entire world economy now based upon banks 'swapping', not much different than kids trading baseball cards.

Fri, 08/19/2011 - 09:12 | 1576697 SheepDog-One
SheepDog-One's picture

'2008 redux is only just starting'

And this time, they have no answer, QE aint it. No ones buying that failed crap anymore. Drop a QE and all theyve done is mark down the dollar, and mark up commodities.

Painted into a corner, bitchez.

Fri, 08/19/2011 - 09:14 | 1576698 knukles
knukles's picture

Bingo....
Hit it on the head!  A bank (maybe even not Swiss?) using the SNB as the channel for dollar funding.

Now, moving past the immaterial to the Big Material, if the world continues to come unglued (as if it's not already happened by my reckoning) and what with the SNB trying to bang the Swisse (like bang de hoe) down to sub-Euro levels (Who can ooze under the newly lowered devaluation bar first?) what are people gonna wanna hold?

Gold and...
US$, the traditional flight to saftey currency (The one eyed in the land of the blind, the tallest pygmy, etc)  

So, where does one get excess large major serious fucking tons of dollars from when everybody's hoarding the stuff? 
Der Federalies is where.

Expect a lot more swaps.  Tons and tons, oodles and oodles, bunches and bunches, gobs and gobs.

And hold on real tight.

                        hug hug hug glom grab grip

 

Fri, 08/19/2011 - 09:15 | 1576713 SheepDog-One
SheepDog-One's picture

Then one morning soon, 'BOOM' something that makes 9-11 look small.

Fri, 08/19/2011 - 09:26 | 1576764 knukles
knukles's picture

Distractions, diversions, rally the troops.... pure Bernays.
Absolutely.

Fri, 08/19/2011 - 10:15 | 1576980 nyse
nyse's picture

...and lock in Bambam for Hope 2.0.

Fri, 08/19/2011 - 09:26 | 1576767 Joshua Falken
Joshua Falken's picture

Well done Knuckles

I wonder if the US$200 million channelled through the SNB was for a European or Swiss shareholder of a Fedral Reserve bank.

 

A backdoor bailout for the boys just like the last US$16 trillion the Fed sneaked past Congress.

 

Bernanke's audacity grows

Fri, 08/19/2011 - 09:18 | 1576732 steve from virginia
steve from virginia's picture

 

Hmmm ... Interesting ... was interesting when the story came out.

I doubt there is a dollar liquidity problem with Credit Suisse or Union Bank o' Switzerland: both have been feasting on dollar liquidity from the QEs and have billion both in reserves and liabilities.

It looks more like a smaller bank with an investment in US stockmarket. A US bank in the same position has lots of available cash due to Bernanke's generosity but the Euro-dollars are harder to come by:

http://futures.tradingcharts.com/chart/GE/M?anticache=1313759640

This is also due to Bernanke's generosity and the 'devil dollar' propaganda aimed at repatriating dollars. The propaganda works ...

The small bank asked the SNB to act on its behalf while it unwound its losing trade.

What is more interesting is the idea of failure/margin call(s) taking place in a bullish environment which indicates the strong franc is another bubble in the process of being popped.

 

Fri, 08/19/2011 - 09:30 | 1576782 hugovanderbubble
hugovanderbubble's picture

+1

Has been Credit Suisse.

Fri, 08/19/2011 - 09:27 | 1576776 sudzee
sudzee's picture

Weiner Abegger, now there's a name that just ooozzzzes credibilty. You can't do much damage control by beating a begger with a weiner. You have to at least use an italian sausage to make a begger listen. We all know that.

Fri, 08/19/2011 - 09:42 | 1576844 SwissNico
SwissNico's picture

maybe it's just smoke on the mirror and actually no swiss banks has asked the SNB to use this line to bluff the market that a Swiss Bank is in trouble and to weaken CHF, or at least slow down the flight to safety into CHF.

Fri, 08/19/2011 - 09:55 | 1576913 BeatTheMarket
BeatTheMarket's picture

I was thinking the same thing...

Fri, 08/19/2011 - 10:00 | 1576935 mynhair
mynhair's picture

Should be good for 50 handles on S&P, no?

Unwound like a good Swiss watch.

Fri, 08/19/2011 - 10:32 | 1577107 Jovil
Jovil's picture

Living through a currency devaluation and how to cope

In 1976 I was managing an American subsidiary of a successful large US Company in Mexico. It had been a financial turnaround for our team. Cash flow had accumulated in our bank in Mexico and corporate didn’t want the money repatriated to the US. Although we had already paid a 35% income tax to the Mexican government, we would have to pay an additional 30% exit tax to repatriate the money. In addition, we would have to pay high fees for the peso/dollar exchange, in order to make the transfer. The company wanted to expand our successful business and so we decided to keep the money in Mexican pesos to be used for further expansion.

One morning, as my wife and I were on a trip driving on the highway, we heard a national message from the President of Mexico, Luis Echevarria, one of the most corrupt presidents in Mexican history. “It is a lie that we are going to devalue the peso,” he said.

http://lonerangersilver.wordpress.com/?s=living+through+a+currency+deval...

Fri, 08/19/2011 - 10:39 | 1577160 lexic0n
lexic0n's picture

Stigmata and stigma are two very different things. Just FYI.

Fri, 08/19/2011 - 12:48 | 1577900 thegr8whorebabylon
thegr8whorebabylon's picture

Stigmata;  Spontaneous bleeding from the wounds of Jesus Christ, an image for these times.  May I recommend google images.

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