S&P 500 Futures On Brink As Banks Lead Losses on Libor Probe

Tyler Durden's picture


The selling started as Europe opened last night and despite a few pull-backs to VWAP, has continued all morning. S&P 500 futures have crossed the chasm and are heading back to new cycle lows here as the major financials are being sold aggressively on the back of tomorrow's release of the NY Fed's Libor report (among other things we are sure) and have given up all their post EU-Summit gains. USD strength, commodity weakness (with Silver And Gold leading the charge lower this week now) and Treasury yields back to yesterday's post-auction spike lows. VIX up to 19.5% and correlation rising very systemically.

S&P 500 futures broke initial support and are teetering on the brink here...

as Financials give up all their post-EU-Summit euphoric gains...

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Thu, 07/12/2012 - 09:57 | 2609694 mrktwtch2
mrktwtch2's picture

can it last a day or 2..? im long vol..

Thu, 07/12/2012 - 10:21 | 2609777 DeadFred
DeadFred's picture

Good question. Things are getting a bit oversold and some support levels are coming up but a wave of LIBOR lawsuits against the banks is the type of thing that could possibly make people question the Bernanke put. Once that question becomes contagious many years of manipulation could disappear really fast [insert definition of really fast]. Oversold becomes unimportant when the rules change. The Fed can't backstop a serious LIBOR related assault and I've been scratching my head wondering why this thing ever saw the light of day and why now. 

Thu, 07/12/2012 - 10:24 | 2609783 tocointhephrase
tocointhephrase's picture


Thu, 07/12/2012 - 10:31 | 2609798 Wakanda
Wakanda's picture

Why now?

It's easier to get hot, pissed off humans into the streets to demand change when the weather is warm/hot?

Thu, 07/12/2012 - 09:58 | 2609702 hedgeisforpussies
hedgeisforpussies's picture

next suppoty on sp 1320 which is huge.if we can break that then 1305-1300 and 1260-1280 followed by 1200-1210. 

Thu, 07/12/2012 - 10:10 | 2609743 firstdivision
firstdivision's picture

Followed by QE

Thu, 07/12/2012 - 11:01 | 2609919 Desert Irish
Desert Irish's picture

So the Bernak is going to be either Obama's bitch or Romney's bitch? - no QE...market tanks...Obama fucked...who's it going to be?

Thu, 07/12/2012 - 09:59 | 2609705 Sudden Debt
Sudden Debt's picture

It's a good year!


let's just hope the option markets don't implode also....


Thu, 07/12/2012 - 10:30 | 2609803 eclectic syncretist
eclectic syncretist's picture

Amen to that.  JPM and WFC report earnings and outlook early tomorrow morning too, so a lot could happen in a hurry going into the weekend.  

Thu, 07/12/2012 - 10:00 | 2609713 midgetrannyporn
midgetrannyporn's picture

May the fed gangsters die with festering boils.

Thu, 07/12/2012 - 10:03 | 2609719 the not so migh...
the not so mighty maximiza's picture

on their bung hole.

Thu, 07/12/2012 - 10:22 | 2609782 Dead Canary
Dead Canary's picture

Fedsters are a seeping boil on the ass of a cancerous rodent.

Thu, 07/12/2012 - 10:08 | 2609735 fuu
fuu's picture

"Stocks Open Down as Fed Fails to Lift Spirits"

Ben just needs to drop some good hydro from the 'copter and all will be better.

Thu, 07/12/2012 - 10:12 | 2609747 mick68
mick68's picture

Yep, like the last two QE's, this one will fix everything right Dufus?

Thu, 07/12/2012 - 10:12 | 2609748 mick68
mick68's picture

And like the last 23 stimulus plans in Japan, all good now.

Thu, 07/12/2012 - 10:11 | 2609744 NumberNone
NumberNone's picture

In a survey of 500 senior executives in the United States and the UK, 26 percent of respondents said they had observed or had firsthand knowledge of wrongdoing in the workplace, while 24 percent said they believed financial services professionals may need to engage in unethical or illegal conduct to be successful.


Sixteen percent of respondents said they would commit insider trading if they could get away with it, according to Labaton Sucharow. And 30 percent said their compensation plans created pressure to compromise ethical standards or violate the law.


Does anything else need to be said?

Thu, 07/12/2012 - 10:17 | 2609762 Flakmeister
Flakmeister's picture

Given this data, who still thinks that an unregulated free markets can exist??

Thu, 07/12/2012 - 10:30 | 2609802 MachoMan
MachoMan's picture

The tradeoff with regulation is the monopolies and barriers to entry it creates.  Aside from the inherent limitations of monitoring and enforcement, as well as compromised enforcement/regulatory capture.

I'll posit that given the "living" nature of regulation, it is impossible for it to maintain stasis...  we start tacking on laws and that process doesn't stop until the economic engines cease to function...  rinse, wash, repeat.

Thu, 07/12/2012 - 10:32 | 2609809 malikai
malikai's picture

I'd like to see a similar survey on regulators and their "pressures" to ignore regulatory matters.


Show me a "regulator" who actually regulates as opposed to becoming a captured tool to be used against the market and maybe we can talk about it.

Thu, 07/12/2012 - 10:32 | 2609813 ArkansasAngie
ArkansasAngie's picture

It isn't unregulation that is the problem

This is a law enforcement problem.

Put people in jail and you will stop it

Thu, 07/12/2012 - 11:01 | 2609918 Saro
Saro's picture

You don't understand! Just like the solution to crippling debt is more debt, the obvious solution to the complete failure of all of our regulations and regulators is clearly more regulations and regulators!

This time will be different!

If only we could get the right people in charge!

Internet porn isn't going to surf itself!

Thu, 07/12/2012 - 11:16 | 2609974 ArkansasAngie
ArkansasAngie's picture

Personally I'd vote for a one-eyed drunked sailor.  It isn't so much to get the "right" person in as it is getting rid of the wrong one.

Neither a Republican nor Democrat be.

Thu, 07/12/2012 - 10:52 | 2609882 Spastica Rex
Spastica Rex's picture

I am a [libertarian] Landru.

Thu, 07/12/2012 - 10:19 | 2609769 5880
5880's picture

They were referring to sexual favors

Thu, 07/12/2012 - 10:15 | 2609755 mick68
mick68's picture

900K lawsuits lined up already against the banks, their stocks should be falling off a cliff today. Reality off day compared to what it should be. Hedge funds and large investors need a week or so to unwind from their bank holdings so we won't see the real drop until they get out. Yep, free market trading is what it's all about...

Thu, 07/12/2012 - 10:17 | 2609756 mick68
mick68's picture

Libor going to cost banks trillions by the time it's said and done, likely lead to the four remaining big banks turning into 1-2, just as planned.

Thu, 07/12/2012 - 10:19 | 2609770 roccman
roccman's picture



the global take over - and attendant crash of global commerce is at the door...


declining oil production was going to bring about this end anyway...all the mutants did was effect the timing.

Thu, 07/12/2012 - 10:19 | 2609768 SmoothCoolSmoke
SmoothCoolSmoke's picture

I'm hearing a new spin from the perma-bulls:  No QE will make stocks go up.  Karabell, Paulsen, etc...........

Thu, 07/12/2012 - 10:26 | 2609789 the 300000000th...
the 300000000th percent's picture

Like Biderman said, 1st QE = up 50%, down 20%, 2nd QE = up 40%, down 20% 3rd QE(op twist) = up 30%, only down 7% so far so wait for another 13% drop before playing QE 4

Thu, 07/12/2012 - 10:33 | 2609814 Bay of Pigs
Bay of Pigs's picture

Biderman? This is the guy you are following to make financial decisions?


Thu, 07/12/2012 - 10:39 | 2609831 the 300000000th...
the 300000000th percent's picture

hey thats not Biderman, thats an alien wearing a Biderman suit.... LOL. Nice clip they both look so young there. Biderman has changed his views dramatically, I guess once you get schooled by Peter your never the same.

Thu, 07/12/2012 - 11:05 | 2609934 Bay of Pigs
Bay of Pigs's picture

Ive been getting junked showing Biderman's inconsistencies and bad calls.

The current ZH crowd is getting very soft in the head.

Thu, 07/12/2012 - 10:31 | 2609805 wagthetails
wagthetails's picture

As if the Libor report will be any more realistic that the Stress Tests.  They'll acknowledge possible manipulation, but that it only amounted to negligible changes, small fine and then the obligatory "we are on the case, so this won't get any worse"  because we all know regulators always spot fraud. 

Thu, 07/12/2012 - 10:40 | 2609806 overmedicatedun...
overmedicatedundersexed's picture

is 7/13/12 a friday? and if so, is it a lucky day?

Thu, 07/12/2012 - 10:36 | 2609820 SmackDaddy
SmackDaddy's picture

Bitches trippin about paper.  Who gives a fuck about finance.  Oil and coal make this economy go 'round.  And the American military is the grease on the motherfucking wheel.

Thu, 07/12/2012 - 11:02 | 2609923 yabyum
yabyum's picture

Very sad but very true.

Thu, 07/12/2012 - 11:13 | 2609961 Alpacanio
Alpacanio's picture

Good time for a False flag?

Thu, 07/12/2012 - 11:34 | 2610026 True.North
True.North's picture

Tyler, please correct me if I'm wrong, but I'm assuming Lehman part of the BBA back in 2008. If so, wouldn't the suppressed LIBOR rates have lured in new investors, thinking the bank was healthier than it really was? As the FED has already acknowledged it knew about the manipulation dating back to 2007, couldn't a legal case be made against the regulators for misleading investors?

Again, this is all within the scope of the FED being responsible for thousands of financial crimes for the sake of 'systemic stability.' However I feel this case could be rather easy to make, and discovery could shine a light on other areas of wrongdoing by the FED. This would also put the FED under the scrunity of the courts, not Congress, which has been a complete circus.

There's never just one cockroach

Thu, 07/12/2012 - 11:38 | 2610037 Boilermaker
Boilermaker's picture

REITS magically shoved up again today.

My god...really?

Thu, 07/12/2012 - 12:10 | 2610126 OldE_Ant
OldE_Ant's picture

Over 1/2 the losses erased already, silver originally in the red now in the green.   Energy sector short pounding continues (meaning the companies not necessairly the commodities).  USD still up.

Plunge Protection Team in action.   Thinking they will try to close this green again, only to be sold into 'strongly' (haha) at the close.   All dog and pony for the remaining masses playing in the rigged market casino.

And all the while business as usual (print and spend until it doesn't hurt anymore) with the powerhungry and unstainable elite.  I guess there arn't enough PMs, guns, and ammo in enough slaves hands for confiscation (ahem re-allocation) yet for the global crackdown.

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