Super Mario Enters With A Bang: ECB Cuts Rate By 25 bps To 1.25%

Tyler Durden's picture

The former Goldman banker cutting rates two days after his appointment? Stunning. Next up, we get to listen to an Italian accent instead of a French one for the first time in a decade, at the press conference to be held shortly. The EUR reaction is appropriate: completely schizophrenic.

3 November 2011 - Monetary policy decisions

At today’s meeting the Governing Council of the ECB took the following monetary policy decisions:

The interest rate on the main refinancing operations of the Eurosystem will be decreased by 25 basis points to 1.25%, starting from the operation to be settled on 9 November 2011.

The interest rate on the marginal lending facility will be decreased by 25 basis points to 2.00%, with effect from 9 November 2011.

The interest rate on the deposit facility will be decreased by 25 basis points to 0.50%, with effect from 9 November 2011.

The President of the ECB will comment on the considerations underlying these decisions at a press conference starting at 2.30 p.m. CET today.


European Central Bank
Directorate Communications
Press and Information Division
Kaiserstrasse 29, D-60311 Frankfurt am Main
Tel.: +49 69 1344 7455, Fax: +49 69 1344 7404

Reproduction is permitted provided that the source is acknowledged.

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Hansel's picture

This fixes everything!

ChickenTikka's picture

Great, we can go home now. I'm gonna go get drunk.

i-dog's picture

Yeah ... good plan ... putting a Jesuit in charge of the ECB! This should end well....

sqz's picture

I'd be more worried about the fact he's Italian and the core of the EZ problems as a currency area are neatly summarized in that one country.

With this rate drop, they have just reduced their tools for managing liquidity, and perhaps more importantly signalled the market for more easing. This increases likelihood of ECB becoming a permanent backstop for EU sovereign debt, with or without the EFSF/ESM, and thus effectively printing (since they seem atrociously bad at sterilizing most of it even at the previous higher reference rate).

Ghordius's picture

i-dog, I thought you have something against my friend of the Order of St. John. Now you have something against Jesuits, too? Did you escape some catholic boarding school or what is it? Were you raped by nuns? Were they hot? Did they force you to do disgusting things?

Draghi is first a EconProfessor, second a Goldmanite, third a career burocrat and fourth an Italian

Ah, I already miss Trichet... bring back, bring back, bring back stabeeleetee to me!

i-dog's picture

Goldman is also run by the Jesuits. You obviously missed my rundown a day or so back.

Maxwell Smart's picture

No, Mario Draghi is first a Bilderberger, so World Government is his primary goal.

qussl3's picture

They just hit the panic button.

For Draghi to cut is open admission that the EZ economy is imploding.

The implications for balance sheets and debt is dire.

We may rally, but this smells strongly of distribution.

LawsofPhysics's picture

"We may rally, but this smells strongly of re-distribution."


Fixed it for you.  You are right, timing is everything. We rally aaaaannnnndddd, it's gone.

rosex229's picture

this should drag down yields on italian bonds right. i'm genuinely curious if that corresponds directly to a 25 pip reduction in the italian 10 yr throwing it back below 6 percent...if not for just a few days

qussl3's picture

Doesnt matter, the headlines out of Greece will overwhelm this throw of the dice.

0.25 aint going to do squat if Greece says FU.

Mike2756's picture

.25 rate cut, 50% haircut.

knukles's picture

Be an Italian
Wear Greece
Bah dump bah dump bah dump bah dump
Watch your Euro
Slide to your Feet....

Gives Surrender a New Meaning.

Tsar Pointless's picture

Truly stunning.

My entire world view has been turned upside-down.

Next, you'll be telling me that the Kim Kardashian/Kris Whateverhisnameis wedding was a made-for-TV farce.

TuffsNotEnuff's picture

And the whole damned front page is about Europe.

How 1950....

trampstamp's picture

doesn't the dollar melt up on this?

homersimpson's picture

You think but don't underestimate stupidity.

Hansel's picture

ECB is at 1.25%, Fed is at 0% until 2013.

HD's picture

Zirp, zirp and away!

Bazinga's picture

Super Mario crashcart in action!

TooRichtoCare's picture

Super Mario basically telling Trichet that he's a dumfukk for having raised rates to begin with...."delivering price stability IMPECCABLY" my arse...good riddance trichet...long live the new king!

vegas's picture

I told you the mistresses and girlfriends were selling the Euro in the 1.3820's. WTF, it's how the world works.

Ancona's picture

That should be good for five percent in Europe today. Yay! More cheap money for everyone.

Wait a minute, these fuckers are still is this going to actually help?

St. Deluise's picture

start collecting them gold coins

paarsons's picture

Another Goldman-Sachs flunkie giving free money to his friends.

What a fucking shocker.

Fuck him in his ass.

reading's picture

Wow, the markets are seriously like an addict getting a crack hit this morning.  Jeez, little jumpy or what.

SofaPapa's picture

It does feel like that, doesn't it?  The withdrawal pain is going to be ugly...

Quintus's picture

What's Italian for "Zee price stabileeeteee"?

LMAO's picture

"Di praisa stabiliaté"

Or better still:

"Cosa Nostra"

Dealer's picture

price stabeeleteee


youngman's picture

Hmmm I thought they had pretty good inflation in ole Europe...and what about their thinks the Goldman Sachs world is back in charge

PaperBear's picture

Gold to $1,800/oz and silver to £36/oz by the end of todays American market ?

pragmatic hobo's picture

now, this in theory should cause euro to go lower in relation to us dollar, correct?

bonderøven-farm ass's picture

It all goes to zero.....when priced to 'confidence' what's the benchmark?

Careless Whisper's picture

The former Goldman banker...

There are no "bankers" at Goldman. It's a government backed hedge fund.

sumo's picture

There are no "former" vampire squid enablers. Once a Goldman always a Goldman.

GeneMarchbanks's picture

Too true. What if I said government was a Goldman backed slush fund?

Zola's picture

The European PRINTOCCHIO has arrived ... Time for that long Gold short Euro trade , I ALMOST WAITED !

Sequitur's picture

Zirp = Print = Debasement.

Cramer on CNBC: "rate cuts are good."

HD's picture

Flip a coin. It's more accurate than cramer on his best day.

sumo's picture

And less volatile. The coin gives you a better Sharpe ratio.

disabledvet's picture

rate cuts are good. it says a total retard has left the building and has not been replaced by another one.

ArkansasAngie's picture

The first person who loses control of his interest rates loses.

Can the whole world go to ZIRP

Anybody want to loan me $1,000,000 to buy Fayettevile rental property at ... gee ... I don't know ... say 2.5%

I'm a better long term risk than Europe.

GoldBricker's picture

Can the whole world go to ZIRP?

I think we're about to get some empirical evidence that it both can, and can't.

homersimpson's picture

That would explain why FAZ went down an additional 2% in seconds.. bastards.

vegas's picture

In about 2 hours, the Mercedes dealership in Athens is going to be busy as hell. Wish I had a webcam there for the bimbo alerts.

AngryGerman's picture