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Greece To Miss Budget Deficit Targets, As Usual, While Qatar Prepares A Bailout Pennies-For-Gold Swap

Tyler Durden's picture


As the Greek parliament meets to finalize huge public sector job cuts, Reuters is reporting that Greece will miss the deficit targets set in its EU/IMF bailout this year and next... We would say "again" but at this point "as usual" makes far more sense, Why this should come as a surprise to anyone is beyond us but the next steps by the Troika (as again and again targets are not met and yet still bank-extending-and-pretending-funding is provided) will be fascinating as they switch from carrot to stick and back to carrot perhaps. Assuming, of course, the "wildcat strikes" at any and all government institutions by government workers about to be sacked, allow Troika member access at some point in the near to long-term future. Although using numbers conceived on napkins as a replacement will be nothing new to either Greece, Eurostat or the Troika. Add to this the comment from the Deputy Leader of the CSU (one of Merkel's tri-party coalition) that Greece would find it easier to recover outside the currency bloc and rhetoric remains high, as do expectations for an inverse surge in the EURUSD at open in a few hours. The biggest winner: Qatar which just snuck in some recycled petrodollars into Greece, which will last the kleptocorrupt government about 1 week, in exchange for Greek gold.

Deutschland sets to pace of what to expect from the EURUSD in two hours:

"I believe it is a solution, if one wants to bring Greece back into a economically stable competitive condition, that this would be done outside the euro zone,"

More from Reuters:

Greece will miss the deficit targets set in its EU/IMF bailout this year and next as it faces worse-than-expected recession, sources said ahead of the adoption by the cabinet of the 2012 draft budget on Sunday.


Greece sees its 2011 budget deficit reaching 8.5 percent of GDP this year, missing a 7.6 percent target, the documents set to be approved by the cabinet show, two sources said.


The budget draft foresees that the deficit will be brought down to 6.8 percent of GDP, above a 6.5 percent target in the bailout that saved Greece from bankruptcy, the sources said.


In the same documents, Greece sees its economy contracting by 5.5 percent this year and 2 percent next year. This is in line with the IMF's World Economic Outlook, published last month, but much worse than the projections used for the July bailout negotiations, which predicted the country's economy would return to growth next year. 


Athens blames its failure to meet EU/IMF deficit targets on the worse-than-forecast contraction of the economy, while its lenders say failure to push through much-needed structural reforms is also largely to blame.


A deeper-than-expected recession makes it harder for Greece to collect revenues and meet its deficit targets. It also makes the impact of austerity measures such as tax hikes and wage cuts weigh harder on people.

At least it is always somebody's fault.

The good news, at least for Qatar, is that the Arab country will provide some much needed funding... in exchange for gold.

Qatar's sovereign wealth fund will invest $1 billion in European Goldfields including $600 million to finance operations in Greece, where the London-based firm has a permit to mine gold, the fund's head said on Saturday.


It was the second major investment in Greece by the Gulf state in two months. Qatar struck a deal in August to provide funding for a merger of two of the recession-hit country's largest banks.


Greece, which is in dire need of private investment as its worst recession in four decades is seen extending into next year, has long sought to convince the wealthy emirate to invest in its private and public companies.


Qatar Holdings will buy a 10 percent stake in European Goldfields from Greek building firm Ellaktor (HELr.AT) and has a call option to buy another 5 percent, CEO Ahmad al-Sayed said after a meeting between Greek and Qatari officials in Athens.


"In total, we will invest in the company about $1 billion," Sayed told reporters.

And in a shocking twist of Ph.D. fate, Greek spam factories remain without any Petrodollar funding.


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Sun, 10/02/2011 - 13:57 | 1730990 Conrad Murray
Conrad Murray's picture

Greece: Get everyone's mind off your shining example of how socialism is a failure, and bomb Turkey.

Sun, 10/02/2011 - 14:18 | 1731014 Cynical Sidney
Cynical Sidney's picture

not to bomb turkey; the greeks have built a huge navy, have it invade and pillage turkey, and use the loot to pay back what it owes

ps. see poe's law

Sun, 10/02/2011 - 14:54 | 1731136 sabra1
sabra1's picture

you do not bomb turkey, you shoot turkey! canadian thanksgiving coming up, and a bombed turkey cannot be served, unless held together with greece!

Sun, 10/02/2011 - 15:11 | 1731159 Panic Panic Panic
Panic Panic Panic's picture

But you Can eat a turkey bombed.

Sun, 10/02/2011 - 15:27 | 1731195 disabledvet
disabledvet's picture

With Wild Turkey anything is possible.

Sun, 10/02/2011 - 17:44 | 1731476 Ahmeexnal
Ahmeexnal's picture

Should have bought FAZ friday morning!

Sun, 10/02/2011 - 19:58 | 1731774 zorba THE GREEK
zorba THE GREEK's picture

If Iran attacked Turkey from rear, Greece would help.

Sun, 10/02/2011 - 20:46 | 1731885 LeonardoFibonacci
LeonardoFibonacci's picture

you mean from behind.  Get anal on the Turks

Sun, 10/02/2011 - 21:18 | 1731950 Panic Panic Panic
Panic Panic Panic's picture

Turkeys have pretty beaks.

Sun, 10/02/2011 - 15:35 | 1731206 disabledvet
disabledvet's picture

Insofar as Poe's "Law": Gravity is weak. And that's a fact. No one makes fun of atheists either because there's nothing funny about an atheist or nihilism in general. (Cue: "I did stand up comedy for Hitler" and other tall tales.) And what the heck is a "tiki-dude"?

Sun, 10/02/2011 - 14:08 | 1731029 Phil Free
Phil Free's picture

How about some reality.  With Turkey's new partnership with Egypt?  Uh, huh.  The only thing Greece will be doing is leaving the Eurozone.  And, for their sake, that should be sooner than later.

Sun, 10/02/2011 - 14:14 | 1731042 terryfuckwit
terryfuckwit's picture

strange habit folks have of replacing the words "greedy wanker bankers" with "socialism". If unrestrained greedy bankers is the issue can we stick with that or shall i put my wife 's name in cause i hate her too ... get real!!

Sun, 10/02/2011 - 14:45 | 1731108 Pegasus Muse
Pegasus Muse's picture

OT:  Just finished listening to an interview at PFSGroup on the demand for Physical Silver as a result of the lastest CRIMEX/CME/CFTC orchestrated take-down in the futures market.  Bottom Line:  Demand for physical silver is through the roof.  Retail investors appear to be waking up.  They're buying silver like it's the last time they'll be able to get it.  Who knows ... they could be right.  Interview starts at the 21:45 marks and runs about 20 minutes.    


“Knowing When and What to Buy in Precious Metals”

Jim addresses the important topic of "knowing when and what to buy in precious metals" in the Big Picture. Jim is also joined by Kathy Derbes CFA of KDerbes Precious Metals LLC to discuss the recent wave of precious metals purchasing at the retail level, and how the premiums have escalated.

A native of New Orleans, Kathy graduated from Vanderbilt University with a BE in Civil Engineering. Following six years of engineering experience, Kathy began her investment management career.

Sun, 10/02/2011 - 14:48 | 1731122 Cynical Sidney
Cynical Sidney's picture

would like to see how JPM will come out of its exposures in PM.

Sun, 10/02/2011 - 15:00 | 1731141 Quintus
Quintus's picture

What do you think the recent carpet bombing of metals was all about? Check out the latest Commitment of Traders report. UNPRECEDENTED volume of short covering by the Commercials just took place. They know what's coming. The takedowns may not be done yet, since there are still a lot of shorts to cover, but the path is clear now. JPM had hit the EJECT button. No doubt they'll be massively long when the SHTF in Greece.

Sun, 10/02/2011 - 17:05 | 1731366 Cynical Sidney
Cynical Sidney's picture

please explain the math of this to me as i lack knowledge in this subject. how is the 'carpet bombing of metals' done? does JPM manipulate the market so they could unwind their short positions on silver? how exactly does drop in commerical net shorts push down the price of PM? perhaps they won't open the same positions at these low prices again in the market as traders anticipate that the price of commodity will experience rapid ascend or descend?

Sun, 10/02/2011 - 17:41 | 1731470 Quintus
Quintus's picture

Oh dear. Where to start. Are you asking a genuine question or are you not really an innocent in the shark-infested waters of the metals markets? Let's give you the benefit of the doubt.

JPM was short >100 days global production of silver. This is a problem. However, there is no effective regulation of the metals futures market in the US (regulatory capture of the CFTC) so they sell massive volumes of paper silver against which they can never deliver actual metal. In an unrelenting dump-fest they drive the price below the 50, 100 and 200 day moving averages, triggering a cascade of sell stops among the tech fund community.

Prices plunge. Then JPM buy back the contracts they sold but at prices far lower than the original sales prices. End result is they are now short 'Only' 82 days of global production and probably made some money on the deal.

Sun, 10/02/2011 - 17:54 | 1731496 RockyRacoon
RockyRacoon's picture

I suggest anyone who wants to stay on top of the movements of the shorts and general PM info subscribe to Ed Steer's daily email letter.   He da man.    ...and it's free.

Sun, 10/02/2011 - 15:52 | 1731246 Ricky Bobby
Ricky Bobby's picture

Central planning and limitless state intervention sounds like socialism to me. Before the Fed bankers played with there own capital and if they lost it so be it. Now they "socialize" there losses. If walks like a duck and quacks like a duck ...

Mon, 10/03/2011 - 00:03 | 1732256 Reggie Middleton
Reggie Middleton's picture

Honestly, who was expecting anything else?? Lies, Damn Lies, and Sovereign Truths: Why the Euro is Destined to Collapse!

The IMF and the EU have been consistently
and overtly optimistic from the very beginning of this crisis. Their
numbers have been dramatically over the top on the super bright, this
will end pretty, rosy scenario side - and that is after multiple
revisions to the downside!!! We can visit the US concept of regulatory
capture (see How Regulatory Capture Turns Doo Doo Deadly and Lehman Brothers Dies While Getting Away with Murder: Regulatory Capture at its Best)
for the EU, but due to time constraints we will save that topic for a
later date. To make matters even worse, the sovereign states have taken
these dramatically optimistic and proven unrealistic projections and
have made even more optimistic and dramatically unrealistic projections
on top of those in order to create the illusion of a workable
"austerity" plan when in reality there is no way in hell the stated and
published plans will come anywhere near reducing the debts and deficits
as advertised - No Way in Hell
(Hades/Tartarus/Anao/Uffern/Peklo/Niffliehem - just to cover some of the
Euro states caught fudging the numbers)!

Let's take a visual perusal of what I am talking about, focusing on those sovereign nations that I have covered thus far.


Notice how dramatically off the market the IMF has been, skewered HEAVILY to the optimistic side. Now, notice how aggressively the IMF has downwardly revsied their forecasts to still end up widlly optimistic. image018.pngimage018.pngimage018.png

Ever since the beginning of this crisis, IMF estimates of government balance have been just as bad...


The EU/EC has proven to be no better, and if anything is arguably worse!




and the EU on goverment balance??? Way, way, way off.


If the IMF was wrong, what in the world does that make the EC/EU?

The EC forecasts have been just as bad, if not much, much worse in
nearly all of the forecasting scenarios we presented. Hey, if you think
tha's bad, try taking a look at what the govenment of Greece has done
with these fairy tale forecasts, as excerpted from the blog post "Greek Crisis Is Over, Region Safe", Prodi Says - I say Liar, Liar, Pants on Fire!...


about it! With a .5% revisions, the EC was still 3 full points to the
optimistic side on GDP, that puts the possibility of Greek government
forecasts, which are much more optimistic than both the EU and the
slightly more stringent but still mostly erroneous IMF numbers, being
anywhere near realistic somewhere between zero and no way in hell
(tartarus, hades, purgatory...).

Sun, 10/02/2011 - 13:58 | 1730996 Mongo
Mongo's picture

What an epic farce... but I am not laughing

Mon, 10/03/2011 - 09:53 | 1731225 Oh regional Indian
Oh regional Indian's picture

Seriously! Greek Tragedy. Given that they are the "cradle" of the west, somehow fitting they are going first. Even so, I feel the pony that will shoot forward on turn 7 and shock everyone is Spain.

Greek is equally the Trojan Horse Archetype. 

Maybe Spain will leap out of the horse's belly, soonish?



Sun, 10/02/2011 - 13:59 | 1730998 knukles
knukles's picture

Get Jimmy O'Neil to take charge and all'll be healed.
Healed I say!  Healed!

The depths of despair to which these people are being driven by this criminal madness is incomprehensible.
T'will be coming Big Time unglued before too long.

Sun, 10/02/2011 - 14:00 | 1730999 tim73
tim73's picture

Revenge in Greece: Go and complete your enemy's house. That way he will have to start paying real estate tax :)

Sun, 10/02/2011 - 14:01 | 1731002 Poetic injustice
Poetic injustice's picture

How can they fail meeting targets, if on last meeting they refused to provide any numbers?

Monday will be stormy, as Merkel will have to fly to Paris again and make "joint announcement of toothless tiger".

Sun, 10/02/2011 - 14:02 | 1731005 johngaltfla
johngaltfla's picture

Feather, knock me over.

This is akin to the headline:

U.S. Budget Deficit far worse than estimated.


______________ (name the institution) under investigation for Insider Trading

Sun, 10/02/2011 - 14:03 | 1731006 He_Who Carried ...
He_Who Carried The Sun's picture

They won't go anywhere without Merkozy's written approval !

Sun, 10/02/2011 - 14:22 | 1731009 GeneMarchbanks
GeneMarchbanks's picture

Greece is like the Bad Boy of the global economy. 'Yeah, listen, maybe next year... wait ... no not even then...

Greece you're so controversial!

'And in a shocking twist of Ph.D. fate, Greek spam factories remain without any Petrodollar funding.'

Nice Tyler, a dig at Roubini. Nice.

Sun, 10/02/2011 - 14:05 | 1731013 agent default
agent default's picture

If Greece goes bust then we will get a Dollar rally which will not be good for PMs.  I think we should be getting out of the way for this one.

Sun, 10/02/2011 - 14:14 | 1731041 zorba THE GREEK
zorba THE GREEK's picture

I wouldn't bet on PMs going down because the dollar goes up. Just a few months ago PMs and the $

were going up and down together. There are many factors influencing the price of PMs.

The only sure winner in the last 10 years has been to buy and hold unlevered PMs.

Sun, 10/02/2011 - 14:34 | 1731085 LowProfile
LowProfile's picture

Yes, and PMs can also go down in dollar terms while soaring in other currency terms.

USD still has some life left in it, you'll see.  Use it to your advantage.

But it changes nothing long term.

Sun, 10/02/2011 - 18:41 | 1731516 DoChenRollingBearing
DoChenRollingBearing's picture

Correct!  more green...

Best to have LOTS of gold and enough dollars in FRNs to cover your bases, you know, in case TSHTF.  The gold will carry your wealth through the crisis.  Might want to have some guns and ammo to protect it though, as I am sure LowProfile does, what with the bullet hole and everything...

Sun, 10/02/2011 - 14:48 | 1731120 jimmyjames
jimmyjames's picture

I wouldn't bet on PMs going down because the dollar goes up. Just a few months ago PMs and the $

were going up and down together. There are many factors influencing the price of PMs.


Someone gets it-

This bullshit idea of an always inverse currency/dollar/gold relationship is nothing but a illusion-why can't these people do a bit of checking before they spout out their misguided "calls"

Gold is simply a currency-like any other currency-but it is the King currency today-



Sun, 10/02/2011 - 16:22 | 1731330 disabledvet
disabledvet's picture

I agree. It's when you get "120% return on a sovereign debt instrument" that i think gold has found a little competition. i'm looking for an interest rate return on my vast Peruvian holdings--and yep, says right here...i've lost everything.

Sun, 10/02/2011 - 15:33 | 1731203 Hulk
Hulk's picture

Zorba, the dollar will be forced down, the economy can't survive a strong dollar...

Sun, 10/02/2011 - 15:47 | 1731226 zorba THE GREEK
zorba THE GREEK's picture

Hulk, there is no doubt in my mind that the dollar will be forced down . Massive QE3 should be very effective to that end.

Sun, 10/02/2011 - 18:07 | 1731520 DoChenRollingBearing
DoChenRollingBearing's picture

Hulk and zorba, both of you are correct and get green.

QE3 will come at some point.  It is the easiest SHORT-TERM solution.

Do what Qatar (sort of) did: buy gold!  While it is still cheap.

Sun, 10/02/2011 - 15:52 | 1731238 jimmyjames
jimmyjames's picture

Zorba, the dollar will be forced down, the economy can't survive a strong dollar...


I doubt they have much room for forcing the dollar down-

A panic to USD safety will confound any political attempts to devalue-

A strong dollar is what the US needs-it cuts import costs and that gives exporters a margin window to lower prices-thus becoming legitimately competitive in world trade-not by devaluing and shifting the negative effects of price inflation onto the backs of consumers who are barely making ends meet-

Sun, 10/02/2011 - 16:13 | 1731309 zorba THE GREEK
zorba THE GREEK's picture

JJ,  I agree that a strong dollar is a good thing for a country, but we have dis-functional government running the

western world. Every country's economy is weak and weakening their currencies to increase exports is now the objective.

In the U.S. weakening the dollar and creating inflation seem to be the only politically acceptable plan to deal with debt.

Bernanke's last public statement was that deflation was unacceptable and that he would take steps to ease (print) if there

were any signs of inflation going down. If Europe crashes and U.S. banks take a big hit, We could see massive bail-outs

even greater than 2008-2009. The only way to keep money from running to the dollar for safety is for the Fed to print

massive amounts of $ and that would probably send money into gold.

Sun, 10/02/2011 - 16:54 | 1731393 jimmyjames
jimmyjames's picture


Yes to what you say-the problem-if you can call it that is the "perception" of USD safety when panic strikes-

You and me and a "few" others know about Gold-the rest only know about paper currency which is one reason for the latest pullback in Gold and USD strength-

At some point fear will implant itself in all the so called safehaven currencies and then Gold will decide how may pieces of different colored paper it will take to buy it-

Sun, 10/02/2011 - 14:33 | 1731080 LowProfile
LowProfile's picture

Careful, you'll draw attention to us.

Sun, 10/02/2011 - 14:06 | 1731017 RyanW525
RyanW525's picture


Sun, 10/02/2011 - 14:14 | 1731040 Zero Govt
Zero Govt's picture

THIS.....IS........SOCIALISM !!


Sun, 10/02/2011 - 14:35 | 1731089 donsluck
donsluck's picture

That's funny. Everything eventually has a 100% failure. The point is, does the government serve the people (as the USA founding fathers insisted should be the case) or does it serve the bankers and business oligarchs?

Sun, 10/02/2011 - 15:43 | 1731218 BigJim
BigJim's picture

The Greek government, like every other majoritarian government, serves the largest and most powerful voters: the poor, and the rich, respectively.

Everyone else gets raped.

Sun, 10/02/2011 - 14:06 | 1731019 tom a taxpayer
tom a taxpayer's picture

Germany 'won't give more to EU bail-out fund'

"AFP - German Finance Minister Wolfgang Schaeuble ruled out Germany contributing any more money to the beefed-up EU bail-out fund than the 211 billion euros approved by parliament, in an interview published Saturday. "The European Financial Stability Facility has a ceiling of 440 billion euros ($590 billion), 211 billion of which is down to Germany. And that is it. Finished," he told the magazine Super-Illu."

"He also suggested the European Stability Mechanism, which is due to replace the EFSF by 2013 at the latest, would be smaller. "Then it will be only a matter of 190 billion in total, for which we will be guarantors, including interest," he explained."

Sun, 10/02/2011 - 18:27 | 1731563 edotabin
edotabin's picture

Junk away, but I call bullshit on Wolfgang and his announcements. 

Sun, 10/02/2011 - 14:09 | 1731025 Zero Govt
Zero Govt's picture

You can't bailout decades of Suicide Socialism and the private economy it has killed with rules and motive-sacking totalitarism and market intervention... ask East German socialist Merkel if she's ever made a profit from the €100's of billions West.G poured/pissed-away into East.G.?

Greece is going to collapse no matter how much good money you pour after bad... the place is a pigs ear of Govt intervention and political 'management' ...Socialist pigs trying to make a silk purse with other peoples money always go down the toilet, good they're taking the bankers with them this time

Sun, 10/02/2011 - 14:24 | 1731059 mjk0259
mjk0259's picture

Greece isn't socialism, it's thievery. They never had any intention of paying these loans back.

Sun, 10/02/2011 - 14:38 | 1731095 GeneMarchbanks
GeneMarchbanks's picture

Good point. No intention to pay back, unlike for example the States.

Sun, 10/02/2011 - 15:48 | 1731233 AbelCatalyst
AbelCatalyst's picture

Very true... I think we're going to see the bond decouple from equities in the US... It will not be long (early to mid 2012) before bond yields begin to rise as equities fall due to the US debt issues. When that happens look out below!! The only safe haven will be PM's.... When bond yields rise as equities fall, this will indicate a loss of faith in US debt/fiat. That will be the moment to back the bus up and pile into PM and short bonds. Until then debt deflation will drive yields and PM lower... I'm just sayin'...

Sun, 10/02/2011 - 16:32 | 1731343 disabledvet
disabledvet's picture

i think we all need to differentiate the term "intent" from perhaps the word..."willing." even Greece "intends" to repay. However whatever you do don't ask for your money back since they may say "we are lacking in the will" or in this case "the people lack the will" repay. "But we thank you nonetheless!" should follow as well should this be "the Roger's Rules of Club Euro." Thank God all they have to do is print more!

Mon, 10/03/2011 - 02:45 | 1732375 mjk0259
mjk0259's picture

States will repay loans. We'll just print more money and inflate it. Anyway, lots of people seem to be crazy eager to lend US money even at zero% and we are only bringing down our own economy at the moment, not all neighboring countries.

Sun, 10/02/2011 - 16:06 | 1731284 crazyjsmith
crazyjsmith's picture

No, Greece IS Socialism AND Banking Thievery. You can be both.
Greece is a deadly mix of the two, just as the US is.

Sun, 10/02/2011 - 18:08 | 1731522 DoChenRollingBearing
DoChenRollingBearing's picture

Yes, excellent point.

Sun, 10/02/2011 - 14:41 | 1731099 falak pema
falak pema's picture

I would have thought that Greece is your nirvana state  :  Zero government, 100% Oligarchy. Why aren't you happy with the state of things in Greece? Your thesis is met 100%. Nobody pays taxes, government is totally ineffective, oligarchs can fukk every body they want including their neighbouring governments through phony sovereign bonds. SO they can plan and execute your universal dream : bring down all  governments through domino effect of private sector rape of public sector via  ponzi financing of non existant government sector bonds. Wow, can't get more sleight of hand than that!

I'm surprised you have not become an honorary citizen of zero government Greece!

Sun, 10/02/2011 - 14:46 | 1731117 Alvaro de Esteban
Alvaro de Esteban's picture

Soo.. more than 1 million public employees are Zero Governmet???

Retirment at 53 for public "servants" is Zero Goverment???

I kwow Its Sunday and we have to be merciful...but don´t try so hard please

Sun, 10/02/2011 - 16:09 | 1731295 agent default
agent default's picture

Zero government infinite burden.  Banana republic 101.

Sun, 10/02/2011 - 16:35 | 1731353 disabledvet
disabledvet's picture

just add a zero. it's all good.

Sun, 10/02/2011 - 16:56 | 1731392 falak pema
falak pema's picture

More than I million UNPAID public employees is zero government (without MEGA and seemingly unlimited outside help). All it needed was ONE word in your first line to set it right...The situation of Greece is unknown in the annals of European nation states. Its more like Africa...this non governance and this absence of government funding through tax collection and this prodigality of government spending, which is classical in banana republics.

Sun, 10/02/2011 - 18:29 | 1731565 edotabin
edotabin's picture

The government is the oligarchy.

Sun, 10/02/2011 - 14:45 | 1731115 DeadFred
DeadFred's picture

What's going on is so opaque few can really tell the true state of affairs but you can make some good guesses on motivations based on actions. The actions we see seem incredibly stupid at face value but make more sense if the situation is a lot worse than reported. My guess is the ones with the inside info realize the financial system is only a half step away from a killer freeze that is so scary they will try ANYTHING to try to stave it off. They are poring toxic antifreeze into a sinkhole hoping it will somehow prevent the system from dying. Who cares if it's only a temporary fix, who cares how much it costs to clean out the mess afterward, it is rank fear that motivates them. Either that or they're braindead stupid and I doubt that.

Sun, 10/02/2011 - 15:18 | 1731172 tickhound
tickhound's picture

it is "rank fear", they are "braindead stupid"

I agree BUT-and-

OR, things are more or less on schedule and by design.  A controlled demolition by way of coordinated currency depreciation seems preferable... when even WE can see the end game.  The fear is in actually controlling (hiding) the demolition in the face of ever increasing public awareness and scrutiny.

Are they hoping to prevent the system from dying?  Or is the hope to somehow prevent the system from dying, too fast?

Sun, 10/02/2011 - 18:11 | 1731528 DoChenRollingBearing
DoChenRollingBearing's picture

@ DeadFred

I have noticed that your writing and logic are consistently clear and logical.  You write well.  Consider starting a blog.

Your point (that short-term is all they care about) is spot on.

Mas verde!

Sun, 10/02/2011 - 15:21 | 1731182 terryfuckwit
terryfuckwit's picture

Your good buddies Jamie and LLoyd take offence to your suicide socialism label. These unsurpassed Private Economy Killers see themselves as pioneering capitalists. They want to know why they are called socialists when they get too good at robbing the poor to feed the rich..


Does any one really think unrestrained rampant socialism caused this crisis as opposed to unrestrained rampant capitalism...

Sun, 10/02/2011 - 16:10 | 1731300 GeneH3
GeneH3's picture

Unrestrained socialism was merely to appease the masses. It was unrestrained crony capitalism/kleptocracy that caused the crisis.

Sun, 10/02/2011 - 14:08 | 1731028 DormRoom
DormRoom's picture

It's not surprising.. Greece has many social programs. More austerity implies more job losses, and slower economic activity, which has to absorbed by her social programs.  Also, no one is paying, so tax revenues will continually trail forecast, as liabilitites from social program grows.


Greece needs to default, and exit the Euro.  Or Germany will exit.   Interesting how Axel Weber leaves ECB, and becomes prospective chairman of UBS.  And UBS comes out with a report showing the non double speak  policy options: German exit.  Or Greece exit.

Sun, 10/02/2011 - 14:24 | 1731058 Phil Free
Phil Free's picture

Greece will be the first out of the Euro.  How long do you think it will take Germany before they bow out also, and return to the Deutsche Mark?  75% of the German citizenry want to have nothing to do with bailing out their broke neighbors, throwing good money after bad.   The Germans have only been on the Euro for 9 years (adopted Feb. '02).  The Euro will not be missed.

Sun, 10/02/2011 - 16:26 | 1731332 zorba THE GREEK
zorba THE GREEK's picture

Germany realizes Greece is just the tip of the iceberg. They now see the the EZ experiment has failed.

Germany is headed for the exits. They have been printing Deutschemarks and have made requests to

the printers to speed up the printing. To stay in the EZ would be suicide for the Germans. When that

happens, and it will be sooner than most think, the Euro will crash down to at least parity if not lower.

We are in for a storm of volatility. 

Sun, 10/02/2011 - 14:11 | 1731031 Joebloinvestor
Joebloinvestor's picture

Greece should do what the US does and LIE about its' gold (since it lies about everything else).

The US counts among the 8000 tons it claims, the un-mined gold on federal land.

This is known as "gold in reserve", which is total bullshit.

Sun, 10/02/2011 - 14:32 | 1731077 Phil Free
Phil Free's picture

Yep.  Don't forget about the empty Fort Knox.  Nixon carefully made off with most, if not all, of the gold stored there (being the primary reason behind Nixon's gold-standard move - he wanted to play with the gold).  Primary reason the FED is so allergic to any kind of audit.  Think of the shockwaves if news got out that Knox was essentially empty.  Would be a sight to see.


Sun, 10/02/2011 - 14:10 | 1731032 PulauHantu29
PulauHantu29's picture

Chinese newspaper "People's Daily" published a front page editorial Saturday telling Europe to quit "dilly-dallying" and get its act together, via Reuters.

Read more:
Sun, 10/02/2011 - 14:18 | 1731051 PulauHantu29
PulauHantu29's picture

The Barbaric Metal shows its shiny head...again.

Sun, 10/02/2011 - 15:27 | 1731196 jomama
jomama's picture

orly, three hours before the 'markets' opened?

Sun, 10/02/2011 - 14:23 | 1731057 you enjoy myself
you enjoy myself's picture

As the Greek parliament meets to finalize huge public sector job cuts, Reuters is reporting...

The Greek constitution guarantees jobs for life to all state employees.  Seriously, that is not a joke.  That's why the ongoing EU attempts to salvage Greece are a tragic comedy.  Imposing "austerity" will literally meet a Constitutional challenge.   Of course, it would never get to the courts in time.  You'll see anarchy in the streets and a complete societal breakdown if job cuts are attempted via the legislature.  There are many towns in Greece where over 30% of the populace works for the goverment.  Job cuts are only going to happen when Greece literally runs out of money.  As their entire society is essentialy one big Ponzi, it can only end like a Ponzi - suddenly, and completely.

I can't believe the Germans continue to throw good money after bad.

Sun, 10/02/2011 - 14:27 | 1731067 mjk0259
mjk0259's picture

Yeah and these "job cuts" - they still get 60% of their salary. It's really early retirement with a generous pension even if you only worked for a couple weeks. The Greeks have their head so far in the trough, they can't be bothered to wonder if the farmer is ever going to stop filling it up. Europe should kick them out and just pay their banks for their Greek bonds - much cheaper and Greece is hopeless. Let Turkey make them a colony again.

Sun, 10/02/2011 - 19:37 | 1731715 Peter Pan
Peter Pan's picture

Let turkey make them a colony again? If i am not mistaken, Turkey and other Muslims have already made a colony of Europe. Or should we allow China and Japan to complete the economic colonisation of the USA with an influx of excess chinese workers and a few boat loads of Japanese retirees?

Those that lent money to Greece without proper due diligence, stuffed up. It will be mutually assured destruction.

Sun, 10/02/2011 - 16:28 | 1731335 traderjoe
traderjoe's picture

One fiat goes they all go.

Sun, 10/02/2011 - 17:32 | 1731453 moldygoat
moldygoat's picture

Looks like theShock Doctrine at work. Greece will be privatized soon enough.

Sun, 10/02/2011 - 14:32 | 1731075 lapedochild
lapedochild's picture

"as again and again targets are not met and yet still bank-extending-and-pretending-funding is provided"...

This is baffling to me as well, but to keep the ponzi going, cognitive dissonance is rampant. Does anyone seriously believe the IMF would be the one to withold the next trance? That would be the unpinning of the hand grenade. For what it's worth, Greece should negotiave for this position of strenght, basically threatning to default.. then you will see how quickly the EZ will pony up more money to keep their own banks solvent.

Anyone have a figure on what percentage of that 8B will leave the country immediatly as interest payments to euro banks?

Greek bailout my ass, Greece is just the medium through which the banks are being bailed out.

Think AIG making good 100c on the dollar to GS with taxpayer money.

Sun, 10/02/2011 - 14:34 | 1731078 PulauHantu29
PulauHantu29's picture

Will France force Germans to pay up? They have done it before:

"In 1922, French and Belgium troops invaded the Ruhr; Germany’s most valuable industrial area. The French and Belgium troops took over the iron and steel factories, coal mines and railways. Those Germans who lived in the Ruhr and were considered not to be co-operating with the Germans were imprisoned. Food was taken. That this action by the French and Belgium broke the rules of the League of Nations - which both belonged to - was ignored by both countries. France was considered one of the League's most powerful members and here she was violating its own code of conduct."

...and this invasion of Germany by the French indirectly resulted in WWII.

Sun, 10/02/2011 - 14:42 | 1731107 Phil Free
Phil Free's picture

An intellectual exercise, but -- no.  France is more in the hole than Germany is.  They'll be exiting the Euro themselves before any troop silliness.


Mon, 10/03/2011 - 11:24 | 1733165 falak pema
falak pema's picture

they'll be exiting the rugby cup and the euro on the same day?

Sun, 10/02/2011 - 14:32 | 1731079 ivars
ivars's picture

Comparison charts between DJIA prediction and actual prices 8 months after forecast:


Accuracy  for last 2 months ( since it was long term forecast, I consider that most important) - 0-5%.

Future trend- accelerating downturn, reaching 10 000  in November 1st, 2011, 9500 end of December 2011, 7500 March 1, 2012, then more or less stable ( as USD takes a hit-devaluation from q2, 2012) , 7000 Nov 2012 ( elections)!

From earlier correlations, such stock market prices means 2-4% drop in GDP starting from Q1 2012.

And loss of internal and external creditor trust in the USA debt leading to default - starting from Q2 2012 once double recession is obvious and future is even less happy.

Mon, 10/03/2011 - 00:59 | 1732316 Campagnolo
Campagnolo's picture

thank you Ivars for the chats, very interesting, please continue posting your thoughs here, I am sure there will a lot of folks that will find relief in your charts and predictions. Everybody please welcome our new zerohedge brother Ivars!, from Latvia with love (and I mean it)

Sun, 10/02/2011 - 14:38 | 1731094 Storch
Storch's picture

If I don't pay you back $100 shame on me for being a deadbeat. If I don't pay you back $100,000,000,000 shame on you for not doing due diligence. Time to punish the countries that lent Greece money so Greece could continue to buy the crap they were manufacturing.

And, if you want to get detailed, shame on them for lending to Greece at an absurdly low interest rate that retardly did not even reflect a remote possibility of default.

The purchase of Greek bonds was motivated by greed and stupidity, and if those traits are not punished in the market then capital goes to dumb shit instead of possibly dumb shit, and we are all screwed.

So default with pride Greece. I will still buy feta and olive oil and probably for a lot less than i can now.

Sun, 10/02/2011 - 16:38 | 1731361 anonnn
anonnn's picture

Interesting viewpoint...

Moneylenders can corrupt, at will,  with nefarious intentions.

Moneylenders' income can come thru hollowing out institutions,  their own   and the recipients'.

Moneylending can be used to create hordes of losers, who become the ultimate source of the OtherPeoplesMoney that was initially hypothecated into existance and then funded by the hordes that were stuck with the original empty [htpothecated] bag.

Sun, 10/02/2011 - 16:40 | 1731369 disabledvet
disabledvet's picture

how 'bout if i don't repay the 1,000,000,000,000,000,000,000,000,000,000,000,000...000,000,000,000,000,000,000.00? What words do i use then?

Sun, 10/02/2011 - 14:44 | 1731110 RSloane
RSloane's picture

They need to be honest with the EU citizens and tell them Greece has no intentions of ever paying anyone back, Greece has no intentions of actually implementing whichever austerity measures that are fashioned in the Greek parliment, and the Greek people have no intentions of paying taxes because you can't levy enough taxes against them to pay for long years of gov't tit living by such a large portion of their population. After that if the EU citizens still think its a good idea to continuously bail out Greece then have at it. At the very least be honest with the people and let them decide. 

Sun, 10/02/2011 - 15:58 | 1731263 Ricky Bobby
Ricky Bobby's picture

Sounds good to me what are there immigration laws?

Sun, 10/02/2011 - 17:10 | 1731422 knukles
knukles's picture


You have to demonstrate to some supercilious, under-qualified, disinterested, corrupt, baksheesh numbed public servant that you know how to take it up the bung without getting too flaky when your mates question your manhood. 

Sun, 10/02/2011 - 15:01 | 1731143 RobotTrader
RobotTrader's picture

Harry Dent tells Carol Massar that the Dow is going to 3000-5000 soon...


Sun, 10/02/2011 - 15:25 | 1731191 GeneMarchbanks
GeneMarchbanks's picture

Totally funny Robo, especially because it'll meet up with Au at around those numbers.

Sun, 10/02/2011 - 15:36 | 1731207 kito
kito's picture

Harry dent went to havard....he must be smart

Sun, 10/02/2011 - 18:40 | 1731586 DoChenRollingBearing
DoChenRollingBearing's picture

PLUS ONE!  I thought that was damn funny!  How can you junk that?  Ivy Leaguers are causing many of our problems.  Not Rice U people though...

Sun, 10/02/2011 - 19:49 | 1731753 SamuelMaverick
SamuelMaverick's picture

Harry Dent is great at demographics and long term macro trends, but he sucks at market price targets, and is clueless on how to trade especially entry / exit points.    Dents ETF has had a 1.49 % gain since its inception in 2009  and is currently 61%  cash and 39% stocks. Any tin foil hat wearer on ZH has crushed this idiots returns just by buying lumps of metal over the past ten years.  Smarten up Robo....

Sun, 10/02/2011 - 15:07 | 1731151 hungarianboy
hungarianboy's picture

Interbank shows gap low of 40 pips ATM from Friday close. No big deal.

Gap will be filled anyway.

Sun, 10/02/2011 - 15:12 | 1731163 tim73
tim73's picture

Greeks are truly fucked double time over. IMF loans are blood money, those guys are tougher than mafia enforcers. When they say jump, you better jump and give all you got. Greece is going through something worse than even Iceland, it could be failed state by next spring. It was not that long ago when military was in charge...

Greek government probably is in full panic mode and that cannot be good for Greece. Even default cannot help that much if the same corrupted system stays. 

Sun, 10/02/2011 - 15:24 | 1731190 Romford_Dave
Romford_Dave's picture

That's f**ked it, gold's sure to head downwards now that an Arab Soveriegn wealth fund invested in it. Their short term investment track record is appalling!

Still on a longer time line, they tend to do a lot better so I guess I'll go all in once it's slipped to maybe 1250 arse wipes per oz.

Sun, 10/02/2011 - 15:32 | 1731199 tom a taxpayer
tom a taxpayer's picture


Breaking News: Greek debt crisis averted in triple deal: U.S., Italy, and Greece.

A frantic last-minute deal before the Guam markets open on Sunday has provided temporary relief to  Greece in a mutually beneficial trade deal between Greece, Italy, and U.S.

1. U.S. to invest $8 billion in Greece solar energy thru Solyndra II, a govt-financed private enterprise. The ambitious sunbeam-catcher project plans to market solar electricity under the trademark-protected "Greek sunshine" brand. 

2. Greece will relinquish to Italy all claims to antiqities, classical art, "birthplace of democracy", "home of the Olympics", and bragging rights to any and all aspects of classical old world history.

3. Italy will free Amanda Knox to U.S.


Mon, 10/03/2011 - 11:23 | 1733159 falak pema
falak pema's picture

and USA will release Fort Knox to whom? A knox for a knox and you can jump like jack in your springbox. 

Sun, 10/02/2011 - 15:47 | 1731231 jmcadg
jmcadg's picture

I heard on BBC radio tonight that a new gold mine had been discovered in Greece, that would make it the biggest player on the continent. But 'Green' groups are up-in-arms about the environmental impact.

Is this anything to do with this Qatar investment?

Sun, 10/02/2011 - 16:36 | 1731356 Schmuck Raker
Schmuck Raker's picture


Mon, 10/03/2011 - 11:19 | 1733143 falak pema
falak pema's picture

Qatar has found the lost city of Atlantis under the sea, entirely made of gold. Apparently, the Israelis and Turks are also laying claims to it. So it might get rough. I hope they don't find any oil there. I wouldn't like my gold to be oil covered, like chocolate sour cream.

Sun, 10/02/2011 - 16:21 | 1731329 monopoly
monopoly's picture

Qatar smart. They know exactly what they are doing.

OK. I run Greece, I am the man. Now, I decide, and I convince the people that we default on all our debt, wipe it out, leave the common market and print drachmas again. Pay nothing back. We are bankrupt, insolvent, sorry, nothing I can do about it. Lloyd, Jamie, and the others are screwed.

For a while the markets shut them out. Don't they have enough of necessities to survive? Iceland slowly coming out of their depression, they told the banks screw you.  Recapitalize Greek banks, put them on a strong footing, suffer depression status for a year or so and then start over and become a strong country. Outside of the common market. At some point trade will begin again and they are truly a country.

What am I missing guys? Citizens are screwed no matter which way you turn the page, but this way they come out ahead long term??? Or do they not understand how this plays out.

Sun, 10/02/2011 - 16:35 | 1731354 Schmuck Raker
Schmuck Raker's picture

This whole fiasco boils down to a lack of imagination.

Germany should sell Greece to Japan.

Isn't it obvious?

There isn't enough Euros to recap EZ banks, so they could really use the Yen.

The Japanese need a few new islands to inhabit that don't glow in the dark. And, as a bonus, having Greece as an "asset" would help keep the Yen from shooting through the roof.

I know, I know...your thinking, "But what do the Greeks get out of it? People are people, not commodities!" Well I've thought of that too - the Greeks get to stop drinking that Ouzo shite, cuz' now they'll be able to afford sum dezents SAKI!

Hmmmmmn, Saakiiiieee.....

Sun, 10/02/2011 - 16:43 | 1731374 disabledvet
disabledvet's picture

I have a note that says "I own Greece" though. Signed "Poopy-Doo" no less. How dere you claim your country for yourself!

Sun, 10/02/2011 - 20:28 | 1731559 TheArmageddonTrader
TheArmageddonTrader's picture

Reuters is missing something here. The deficit targets that donors are insisting Greece stick to are nominal amounts measured in Euros. The deficit/GDP ratio is a forecast, which depends on the GDP forecast.

If Greece is promising to stick to its nominal deficit targets while admitting it will miss its deficit/GDP forecasts, donors will be okay with that.

If Greece is saying it can't meet its nominal deficit targets, donors will probably not be okay with that.

Anyway the much bigger holes in the bailout program have to do with the planned privatization revenues and planned savings from the private bond swap.

An update edit: Greece is saying this budget is troika-approved, as I suspected. Of course GDP will keep on missing forecast and revenues will keep on missing target, but assuming they can get this through parliament it should be enough to unlock the 8 billion and push back default another few months. Meanwhile Germany's push to cancel the bond swap and instead have a "managed default" remains alive.

Mon, 10/03/2011 - 09:04 | 1732731 mekia
mekia's picture

The biggest winner: Qatar which just snuck in some recycled petrodollars into Greece, which will last the kleptocorrupt government about 1 week, in exchange for Greek gold.


The Qataris bought a stake in the company from another company in the secondary market, This helps Greek government how?


The mines in Chalkidiki have been in operation since the 20s and have been foreign owned since the early 90s (TVX Gold - Canada).

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