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Things In Europe Go From Bad To Worse As Germany's FDP Party Seeks Referendum Over EFSF

Tyler Durden's picture


No sooner has the EFSF "passed" the German constitutional court (with large caveats, most notably that the German government will have a much greater say in any and all future European bailouts, assuming such are actually needed and the Euro does not implode), that we learn that yet another hurdle for the Greek bailout presents itself courtesy of primary fund provider, Germany, which is now finally very angry (as suggested first here "The Fatal Flaw In Europe's Second "Bazooka" Bailout: 82 Million Soon To Be Very Angry Germans, Or How Euro Bailout #2 Could Cost Up To 56% Of German GDP" two months ago) at what it realizes is an ongoing transfer without checks and balances (remember: the insolvent PIIGS hold all the trump cards) of capital from Europe's prudent workers to those who are, well, not. To wit, according to the Spiegel, German FDP Party has just announced that it will seek a referendum on the ESM/EFSF. What this means is that while the hurdle is not insurmountable from a legal perspective, it will merely add further uncertainty to the final bailout of a country that according to the market at least is 100% bankrupt in an alternative universe in which fundamentals matters.

Google translated:

Several front against the Liberals make permanent euro rescue ESM. With a membership vote, a group wants to prevent the FDP politician Schäffler and stag party for the approval of the aid package.


The Christian Lindner letter reached Friday afternoon by 17 clock by messenger. Since then, should the weekends of the FDP-General to be thrown overboard. In order to prevent the approval of the FDP faction in the Bundestag for permanent euro rescue ESM in the fall, a group aimed at the euro-skeptic Frank Schäffler and the Old Liberals Burkhard Hirsch, a membership vote on. "The discussion in the FDP on more measures to rescue debt-ridden countries in Europe is an important political issue and requires a broad discussion in the FDP," it said in a letter to FDP General Secretary Christian Lindner on Friday. The letter is from SPIEGEL ONLINE.


In a decision that the critics of the euro rescue measures apply to "permanent emergency measures for which Germany is liable for the debts of other European states." It continues: "The FDP opposes hence the establishment of a permanent European Stability Mechanism (ESM)." Should not the previously agreed measures prove to be sufficient, says the FDP in favor of over-indebted countries in an orderly exit from the to allow Euro to avoid a messy break-up of our currency. "


For Chancellor Angela Merkel (CDU) and the FDP, the party leadership is bad news. And it comes at an inopportune time. Just ECB chief economist Juergen Stark has resigned. In addition, the conservative-liberal government is currently fighting for the majority of the extended, temporary rescue EFSF. Now threatens the later vote on the following permanent pilot chute for ESM to be cliffhanger. Lacks the Chancellor with such a central issue in European politics with a majority, it could mean the end for the black-yellow coalition.


Especially since it is not excluded that the Euro-critics with their application be successful. 3,400 signatures have to collect the protesters for the action, which is five percent of about 68,000 FDP members. It provides for the Rules of Procedure. The last and only time the FDP had consulted their members in 1997 when the Great eavesdropping. The party leadership has the opportunity to amend the critics with its own alternative proposal to counter. One-third of the members involved in the decision, the result is official policy position of the FDP. The faction in the Bundestag must vote accordingly.


Initiator of the request is € tireless critic Frank Schäffler. That he is supported by Burkhard Hirsch, a Liberal of the old school, his concerns should give a new impetus. "I'm for Europe. But I am afraid that the way we want to save the euro, it says that we will divide Europe at the end," said Hirsch SPIEGEL ONLINE. "I am against a slide into a debt union. So far, all the billions we have paid to Greece, led to no result."

We expect the market will take the usual several hours to process this.


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Fri, 09/09/2011 - 13:08 | 1651453 swanpoint
swanpoint's picture

Things, Bitchez!

Fri, 09/09/2011 - 13:12 | 1651476 AldousHuxley
AldousHuxley's picture

Germans have history of world wars. Don't make them angry. They are already angry from Mercedes Benz association with Chrysler.


WSJ..."FRANKFURT—Jürgen Stark, Germany's top representative on the European Central Bank's executive board, is resigning, a blow to an institution struggling with its credibility in Germany over its controversial decision to restart its government bond-purchase program."

Fri, 09/09/2011 - 13:29 | 1651539 Ahmeexnal
Ahmeexnal's picture

False flag attack to prop up the markets?
Breivik's imaginary buddies about to make headlines?

Fri, 09/09/2011 - 14:20 | 1651679 slewie the pi-rat
slewie the pi-rat's picture

lemme just jump the string like swami salami, ok?  who fuking carez?

c'mon, BiCheZ!  junk me!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

in trying to keep up w/ the other ad-bot T-R-0-0-Lz, such as oobrien, oo0RI, and bob_d, and will post this same post all fuking day long, b/c i don't hava blogsite...except for zH, of course, where i may have a "subscriber" or two.  who knowZ?

Q:  has the West's unfettered and  unlawful aggression in libya helped destabilize NATO & turn the EU into a pushover for the muslims or the girl scouts? 

well, the moQ is still somewhere or other, and THE Council which has promised elections w/in 8 months is demanding his surrender as well as those who are still armed and ready, willing, and able to keep fighting 
US "intelligence" is now saying he is in some desert oasis, so i guess that place will get "surgically flattened" pretty soon if all the "bad guys" don't come out with their hands up
the press is now reporting a "total" of 6 who were "rendered" to libya on condiefuking rice's watch "under" g.w. "puppet" bush
here's the recent bodycount: At least 30,000 Killed, 50,000 Wounded in Libyan Conflict
anyone interested in "doing the math" only needs to "estimate" how many were "combatants", subtract, and get the innocent civilians not protected by the ~10,000 NATO bombings.  oh, the "statisticians" are saying the "final" totals may be adjusted upwardZ in a "few weeks"
and, as we remember the "reason" that the USA now has a policy of torture and denial of, NOT "human rights", but denial of LAW & JUSTICE to all, please consider what the best freaking presidential candidate of the century has to say about this 9.11 weekend~~~yeah, the guy who has been on the ballot in all 50 states for the last two elections, ralphie-boy nader:
The Empire is Eating Itself » Counterpunch: Tells the Facts, Names the Names
L0L!!!  (if you take a few minutes to read this piece, you will understand why he is the best candidate.  if he runz, of course, no matter wtf tyler is hallucinating, politically, these daze)

p.s. risk off, BiCheZ!
p.p.s. no mo coffee for tyler. ever!  but he does look fabulous in that Dow 11,000 hat w/ the two "fat fingers" for the oneZ! 

Fri, 09/09/2011 - 15:19 | 1652082 tooktheredpill
tooktheredpill's picture

if someone says bitchez one more time...

Fri, 09/09/2011 - 18:17 | 1652672 edotabin
edotabin's picture

Overused as BITCHEZ may be, I still think its better than "bailout, bailout, bailout" and "eurbond, barroso, rompuy" and all the other crap we have been reading over and over and over and over........

Going down .................BITCHEZ!!


Fri, 09/09/2011 - 13:59 | 1651701 BlackholeDivestment
BlackholeDivestment's picture

13 Banks ah Bailout Go Go and NWO 911 German Curveball. Steeee ...rike.

Fri, 09/09/2011 - 13:29 | 1651543 Oh regional Indian
Oh regional Indian's picture

i think what everyone needs to notice here is the classic sleight of hand played by the.........wait for it..... CORPORATIONS.

Keep the people buried with political shennanigans, distractions, perhaps soem religion thrown in.....but the corporations always come out fine!

Germany is booming in India. As is Japan. Just BOOMING. Japan has the low end, Germany has the high end. Both have been here a long time, Mercedes Benz, Bosch, Siemens, it. Honda, Toyota, Komatsu, all plum partnerships with India's sell out Globalists the tatas, mahindras, ambanis...

They will have no problem leaving German's/Japanese hanging if push comes to shove. They never outsourced here, set up factories, both countries. With primary German ownership and management.

The corporations are doing fine, using simple labour arbitrage and regulatory capture and bribery to spin their web around the globe.

It's not about the Germans or the Greeks or the Americans or the Indians.....


Signs of the Fall

Fri, 09/09/2011 - 14:31 | 1651861 slewie the pi-rat
slewie the pi-rat's picture

hey, toy boy!

nice ads today!  evrybody sure loves the way they don't show that they go to the aardvark site no mo, too!

thanks for the fortune telling!  and helping the zHeads to understand current events more deeply

if "germany sinks the EU", will you and yer touch-hole buddy, falak penis, go back to telling the whole world how "germany won WWII"?   you haven't mentioned that "thesis" since the german high court ruled (cum caveats) that the euro bonds weren't "illegal" have ya?

whatza matter, wind shift on ya? 

Fri, 09/09/2011 - 15:33 | 1652143 mick
mick's picture

well remembered - that "germany won ww2" nugget was one of the stupidest comments ever posted

Fri, 09/09/2011 - 13:52 | 1651673 kaiten
kaiten's picture

Just to make it clear. FDP is talking about party referendum, not nationwide.

Fri, 09/09/2011 - 14:45 | 1651886 Roger Knights
Roger Knights's picture

Thanks -- the Google translate was unusually unclear.

A nationwide referendum is the next logical step for the FDP to call for. Such referendums will be called for in other countries too, like Finland, Slovenia, Slovakia, and ...  The euro-elites won't be able to keep control of the political process.

Fri, 09/09/2011 - 14:34 | 1651875 Bluesdog
Bluesdog's picture

"They are already angry from Mercedes Benz association with Chrysler."

LMAO. Dude when taken in context of your post and the original article, that has to be funniest line of Month if not year. Freakin hilarious!


Fri, 09/09/2011 - 13:18 | 1651498 Clorox Cowboy
Clorox Cowboy's picture

Long AKs, non-GMO seeds, colloidal silver...and NFLX

Fri, 09/09/2011 - 13:26 | 1651526 Azannoth
Azannoth's picture

The FDP is dead in the watter they might not clear the 5% entry point in the next election, thus they got nothing to loose and this would be a very popular move if they could block the PIIGS bailout

good luck to them

Fri, 09/09/2011 - 13:58 | 1651697 CrashisOptimistic
CrashisOptimistic's picture

This is true, but the reason this is powerful is that in a secrecy of the ballot booth, people will vote to be German and not European.

Politicians in parties might fear being told they are returning to nationalism and not being good Europeans if they speak out so publicly, but the public . . . in secret . . . will vote their own pocketbooks every single time.

A referendum vote by the people would kill all the bailouts.  It's powerful.

Fri, 09/09/2011 - 13:08 | 1651454 redpill
redpill's picture

This is a time game now, a match between how long it all gets stretched out, and how long it takes Greece to officially default. Although in the end I don't think the ECB would ever allow the latter to happen.

Fri, 09/09/2011 - 13:11 | 1651470 mayhem_korner
mayhem_korner's picture

I'll take that bet. 

Fri, 09/09/2011 - 13:30 | 1651544 Spitzer
Spitzer's picture

What is right with the Euro is what is wrong with it.

How does debt default result in hyperinflation of the Euro ? It doesn't. The Euro will fall just like the currencies in the Asian financial crisis but it will not hyperinflate. The dollar sure will though.

Betting against the Euro currency is not a god idea.

Fri, 09/09/2011 - 13:35 | 1651574 mayhem_korner
mayhem_korner's picture

I was taking the bet that the ECB would let Greece default.

Fri, 09/09/2011 - 13:48 | 1651640 Spitzer
Spitzer's picture

My bad. I would take that bet too.

The Fed wont let Greece default though. Haha poor dollar.

Fri, 09/09/2011 - 14:45 | 1651923 Instant Wealth
Instant Wealth's picture

Back in the old days, I took the bet that they would allow ITALY to join the eurozone. I knew the whole thing was rotten from the start (... oh, yes, and I won that bet, of course). 

Fri, 09/09/2011 - 13:12 | 1651477 maxmad
maxmad's picture

Seriously, I thought someone would have to be awake to get on to ZH?  hmmm..  Maybe I'll try getting on while I'm asleep!

Fri, 09/09/2011 - 13:08 | 1651455 Id fight Gandhi
Id fight Gandhi's picture

It's about time the Germans tell the eu and Greece to get fucked. Theyre just dead weight.

Fri, 09/09/2011 - 13:11 | 1651466 Scisco
Scisco's picture

Two words: vendor financing.


Fri, 09/09/2011 - 13:32 | 1651559 Lord Welligton
Lord Welligton's picture


Although it doesn't always work out does it.

Fri, 09/09/2011 - 13:42 | 1651607 Scisco
Scisco's picture

It falls apart when accounts become due. Which should be in 3 .. 2 ..

Fri, 09/09/2011 - 13:10 | 1651462 John McCloy
John McCloy's picture

Wow..and that's the ballgame folks. Please remember to toss out your crackerjacks.

Fri, 09/09/2011 - 13:34 | 1651570 SilverRhino
SilverRhino's picture

I wonder if it's possible to do a PUT on the USDEUR exchange rate.  Anyone know?  I bet parity is coming.  :)

Fri, 09/09/2011 - 15:53 | 1652233 Roger Knights
Roger Knights's picture

There are "markets" (multiple bets on the year-end EUR/USD ratio on Intrade, but unfortunately trading is thin and spreads are wide. I have an offer in, at 50:1, that the euro will reach parity with the dollar, but there have been no bids. I have managed to place a few short sales on the eur/usd ratio at other levels. Here's the link:

One can also bet on whether any country will leave the eurozone by the end of this year or subsequent years. Trading is fairly active. Here's the link:

Fri, 09/09/2011 - 13:10 | 1651464 mayhem_korner
mayhem_korner's picture

The roaches have realized the lights are on and are headin' for the exits.

Fri, 09/09/2011 - 13:10 | 1651465 Josh Randall
Josh Randall's picture

Germany is taking their marbles and going home

Fri, 09/09/2011 - 13:21 | 1651510 TruthInSunshine
TruthInSunshine's picture

Germans are about to make liverwurst out of any of their politicians that support the EU 'redistribution mechanism,' so their politicians are trying to hatch schemes as to how they can perpetuate the Ponzi on the sly, aka stealth-like.

But they can't, and they won't, because it's not possible at this point...

They already tried to sneak one by with the 'Eurobond' crap.

Fri, 09/09/2011 - 13:12 | 1651475 max2205
max2205's picture

Great News: we filled the gap from Sept 7th....weee onward and upward

Fri, 09/09/2011 - 13:20 | 1651507 Stax Edwards
Stax Edwards's picture

I am with you : )

Fri, 09/09/2011 - 13:13 | 1651480 RobotTrader
RobotTrader's picture



If the Euro bounces from oversold conditions, there will be an irresistable urge to buy any and all crappy cyclical stocks.

Too many guys want to "Make Their Year" in 2011.

Trichet single handedly caused the "double dip" with his rate hikes and then finally foamed at the mouth about "price stability".

Now the Euro is in free fall and credit spreads are blowing out so all it will take is for some bureaucrat to utter some soothing "words" to turn things around.

Fri, 09/09/2011 - 13:33 | 1651561 Spitzer
Spitzer's picture

Euro Fed primary dealer bankruptcies will result in dollar printing, not Euro printing. 

The ECB is divorced from the commercial banking sector in Europe.

Fri, 09/09/2011 - 17:30 | 1652438 DaBernank
DaBernank's picture

Why not stick with the "every thing that's wrong with X is what's right with X" line? After all, it could apply to everything.

You should be honest from now on and admit that the ECB has less gold than even the netherlands: (as of May 2011) 501.4 tonnes, 18.8% of its total reserves, market value: $18.6 billion. No sovereigns are going to give an ounce more to the ECB if gold actually begins to see its historical persona.

The ECB is loaded with public debts of member states and there is no end in sight. It is officially not beholden to political interests but of course it is. It is not technically intertwined with SocGen but the ability to recapitalize off the back of the French will be severely compromised if SocGen pulls a Lehman. The ECB is also officially unallowed to *directly* monetarize the European States' deficit spending, which just means that there's a magical "off-balance sheet" entity which gets inserted between point A and point B. And there are also 16 little National banks all transferring the shit from their balance sheets to the ECB, hoping somebody else defaults first - guess who? Opa! Balance sheet acrobatics does not a solid bank make.

Perhaps Spitzy and I can agree on one thing: if you have Dollars, buy gold. if you have Euros, buy gold.

Fri, 09/09/2011 - 13:14 | 1651484 PulauHantu29
PulauHantu29's picture

Germans don't want to take it up the Butt (w/o the Lube) for Bankers Bonuses?

Can't imgaine why they are angry?

Fri, 09/09/2011 - 13:13 | 1651485 rayban
rayban's picture

This initiative, if implemented, is likely to seal the end of the current coalition. Angela might be replaced pretty soon.

Fri, 09/09/2011 - 13:14 | 1651489 Cone of Uncertainty
Cone of Uncertainty's picture

This is such horseshit.

Germany will play right into the hands of these bankrupt countries.


Fri, 09/09/2011 - 13:15 | 1651491 RobotTrader
RobotTrader's picture



GDX just turned red, SMH green.

All the Waxie Parness "Red Light" and "Green Light" or "Stop" and "Go" programs probably issued a buy signal.

Fri, 09/09/2011 - 13:22 | 1651512 Cdad
Cdad's picture

This rise in the dollar through the 200 day is bound to play hell with EVERY algorithm out there.  Short term pops in anything should be sold...period.

Fri, 09/09/2011 - 13:28 | 1651535 SheepDog-One
SheepDog-One's picture

A rising dollar thru the 200 is the FED's worst possible nightmare....they survive by devaluing the dollar to keep their phony assets inflated. This could end very badly any minute, the FED central banksters will spare no lives to save themselves.

Of course all idiots like Robo sees is a green color and get excited like a dumb cow,

Fri, 09/09/2011 - 13:40 | 1651593 Cdad
Cdad's picture

Correct.  And this dollar rally has legs, Dog.

Fri, 09/09/2011 - 14:32 | 1651866 ReactionToClose...
ReactionToClosedMinds's picture

Sorcerer's Apprentice just getting started ..... US$ ironically looks like intermeidate term strenghten ... for all the worst reasons too

Fri, 09/09/2011 - 15:05 | 1652016 TruthInSunshine
TruthInSunshine's picture

USD is going to be the least ugly currency at the dog pound for some time.

Relativity, bitchez.

(Bernank & Timmay G don't mind, as it makes their job of tnote selling much easier)

Fri, 09/09/2011 - 13:43 | 1651612 mayhem_korner
mayhem_korner's picture

So what would they do to combat the flight to the USD?  The only thing they know is to print.  Do they have enough ink on hand, or are you saying they'd have to unleash the $1B FRN...?  What's a Ben to do?

Fri, 09/09/2011 - 13:16 | 1651495 scratch_and_sniff
scratch_and_sniff's picture

looks like Greece is on the denial, just after european close too, well thats a supprise.

Fri, 09/09/2011 - 13:23 | 1651499 Stax Edwards
Stax Edwards's picture

My read of it says that should the EFSF (that has already been approved), be insufficient (which it is), they oppose a permanent ESM mechanism.

So not convinced this is exactly groundbreaking news.

Edit: Correct me if I am mistaken, but the headline of the post is wrong is it not? 

Fri, 09/09/2011 - 13:21 | 1651511 THE DORK OF CORK
THE DORK OF CORK's picture

Prudent workers me hole - here is how it worked , reduce fiscal defecits at the core , thus hyperinflating credit - give it to Irish , Iberian and Greek banks - let them destroy capital through malinvestment - wait 15 years until no more wealth can be extracted and buy Gold with your loot.

Germans & French have been betrayed by their own banks - their domestic capital investment has imploded since 1992.

Fri, 09/09/2011 - 13:27 | 1651521 swissaustrian
swissaustrian's picture

If FDP doesn´t support the ESF, SPD will.

Fri, 09/09/2011 - 13:25 | 1651525 rexzy
rexzy's picture

My fathers 60th birthday coming up.  Was thiking of getting him a rolex watch for about 5grand.  but with the way economy is going to shit.  I've started to think of maybe getting him some bullions.

Fri, 09/09/2011 - 13:32 | 1651555 Amish Hacker
Amish Hacker's picture

May I suggest 5 grand worth of AU and a 20-dollar Swatch?

Fri, 09/09/2011 - 13:40 | 1651591 Moe Howard
Moe Howard's picture

Solid gold rolex. Best of both.

Fri, 09/09/2011 - 13:26 | 1651528 Temporalist
Temporalist's picture

It's funny how so many are increasing their bearish sentiment either about the US or EU;  Zuckerman, Roubini, Feldstein, Greenspan...and simultaneously Gold is not going up but is being covered in the media as a safe haven.

Why isn't gold up $100 today? 


Fri, 09/09/2011 - 13:29 | 1651538 SeverinSlade
SeverinSlade's picture

Patience lad, patience.

Fri, 09/09/2011 - 13:46 | 1651634 mayhem_korner
mayhem_korner's picture

Margin hike yesterday took out $30/oz overnight.  From that manipulated baseline, it's up a healthy bit.  Would be nice to see a "19" handle going into the weekend, though.

Fri, 09/09/2011 - 13:28 | 1651536 Atomizer
Atomizer's picture

Ladies and Gentlemen,

It's a pleasure to be here today and to speak to so many distinguished guests. I only have Thirty-five euros and a six pack to my name.

Fri, 09/09/2011 - 13:41 | 1651581 Burr's 2nd Shot
Burr's 2nd Shot's picture

I know

It will be ok

When I get a six-pack in me

That's Right!

My Chancellor asked me which one I like better

I hope the answer won't upset her (it's six pack!)

Fri, 09/09/2011 - 13:28 | 1651537 John Law Lives
John Law Lives's picture

It's okay. The Great Chairsatan can fix the global economy in 15 minutes. He can print more money and make things right. Everything will be coming up roses and daffodils.

100% FUBAR.

Fri, 09/09/2011 - 13:29 | 1651541 tony bonn
tony bonn's picture

the fdp will fail spectacularly - even if they win at the ballot box the german high court will rule the objection unconstitutional or claim that the plaintiffs have no standing.....

david rockefeller asserted during the 1970s latin american debt crises that sovereigns do not go bankrupt, and so shall it be.....after all, it isn't a government at risk of failing but a cabal of banksters.....and that, my friend, shall never happen....

Fri, 09/09/2011 - 13:30 | 1651545 citta vritti
citta vritti's picture

9, 9, 9, 9, 9, 9, 9, 9 ....

Fri, 09/09/2011 - 13:31 | 1651548 kahunabear
kahunabear's picture

that according to the market at least is 100% bankrupt in an alternative universe in which fundamental matters

The bulk of the discussion on this site are about markets NOT reflecting fundamentals. I guess the key to understanding markets is that they are only correct when they price in complete bankruptcy, given that the world is bankrupt, huh?

Fri, 09/09/2011 - 13:32 | 1651554 Tyler Durden
Tyler Durden's picture

That... and when one looks at implied default levels per CDS which are... 100%

Fri, 09/09/2011 - 13:55 | 1651683 Yen Cross
Yen Cross's picture

Plus one to Ya"

Fri, 09/09/2011 - 13:39 | 1651589 Spitzer
Spitzer's picture

The only real central bank the world has is the ECB. The ECB is poised to run the world as Bretton Woods 2 collapse's before our eyes.

Fri, 09/09/2011 - 13:51 | 1651662 THE DORK OF CORK
THE DORK OF CORK's picture

Of course they have destroyed the industrial fabric of Europe in the process - to the victor the spoils I guess.

Fri, 09/09/2011 - 14:41 | 1651910 FreedomGuy
FreedomGuy's picture

You beat me to the exact same thought. In that alternate universe is the USA also a AAA credit rating? Laughable.

Fri, 09/09/2011 - 13:34 | 1651566 Belarus
Belarus's picture

Any good artifcles on reprecussions if Greece is allowed to leave Euro or default?

Fri, 09/09/2011 - 14:09 | 1651637 Nate H
Nate H's picture

it will be an unmitigated disaster as market quickly prices in same for Portugal, Italy etc. Lehman X 10. Possibility >25% of trade cessation within Europe and beyond.  Possibility ~10% of grid going down and grocery stores empty etc.  (some think I exaggerate, these things are possibilities not certainties, but I have researched this for years -what if EUR not accepted for trade/LOCs. The leverage and complexity of current international trade system would take your breath away -and the market is focused only on 'the market' forgetting that certain aspects of finance can spill directly and urgently into our physical systems).  "good articles"?  No

Fri, 09/09/2011 - 13:35 | 1651569 vast-dom
vast-dom's picture

SP dips under 1k on the 20th and Bernank prints on the 21st!


Paranoid and Correct.

Fri, 09/09/2011 - 13:35 | 1651571 Everybodys All ...
Everybodys All American's picture

My take is that one of two things is about to happen (couple weeks or months). Either Greece is forced to leave the Euro or Germany will leave on their own and go back to the Deutchmark.

Fri, 09/09/2011 - 13:39 | 1651590 rexzy
rexzy's picture

There is no Euro with out Germany

Fri, 09/09/2011 - 13:41 | 1651598 Everybodys All ...
Everybodys All American's picture

The Germans are not stupid and are concerned about their own survival.

Fri, 09/09/2011 - 13:43 | 1651609 Spitzer
Spitzer's picture


The ECB will hold the Fed hostage to print dollars to bail out their Euro Fed primary dealers. It is happening now.

The more dollars the Fed prints, the less valuble the ECB and world CBs dollar holdings get and the more valuble the ECB and world CB Euro holdings and gold get.

Euro currency CB holdings are above 30%.

Fri, 09/09/2011 - 13:54 | 1651678 Everybodys All ...
Everybodys All American's picture

Got a better reason for Jürgen Stark to resign from the ECB today?

Fri, 09/09/2011 - 14:44 | 1651918 Spitzer
Spitzer's picture

He was bribed to leave by Goldman to throw dirt on the ECB

Fri, 09/09/2011 - 13:36 | 1651577 bugs_
bugs_'s picture

A Debt Union!

Of by and for the Debt!


Fri, 09/09/2011 - 13:37 | 1651582 firstdivision
firstdivision's picture

I'm sure the ECB will ring fence this Greek problem, like the Fed ring fenced the sub-prime problem.

Fri, 09/09/2011 - 13:42 | 1651606 Caviar Emptor
Caviar Emptor's picture

I think Tyler's underestimating the situation in Germany: debt/GDP is right behind France's. Banks are insolvent too. Aging population with restricted immigration. Huge entitlements: Average Germans get 6 weeks paid vacation per year and expect free healthcare, education and pensions and work week is 38-42 hours. In other words far worse than US entitlements where the population is younger

Fri, 09/09/2011 - 13:45 | 1651617 Spitzer
Spitzer's picture

Germany has a trade surplus with China.  Germany is a creditor nation. They can afford allot of this shit.

Fri, 09/09/2011 - 13:48 | 1651645 Caviar Emptor
Caviar Emptor's picture Greece, you mean? 

Fri, 09/09/2011 - 14:19 | 1651788 schadenfreude
schadenfreude's picture

Germans have 5trn in savings and participation rate in equity markets is below 10%.

Fri, 09/09/2011 - 13:44 | 1651620 Lord Welligton
Lord Welligton's picture

It Greece defaults it is difficult to see a lot of appetite for the €60bn Italian debt rollover this month.

Fri, 09/09/2011 - 13:49 | 1651652 kito
kito's picture

its a tad disturbing not to see gold moving up on europe today. i hate having that 2008 feeling, even if its ever so slight. 

Fri, 09/09/2011 - 13:50 | 1651655 dcb
dcb's picture

noting like a little democracy to get in the way of facism.

Fri, 09/09/2011 - 13:52 | 1651665 Pretorian
Pretorian's picture

Did some 1 in Germany fart the word EFSF? Pls submit if happened so the markets can tank more.

Fri, 09/09/2011 - 13:53 | 1651677 Yen Cross
Yen Cross's picture

C Dad Rocks!  +`~

Fri, 09/09/2011 - 14:04 | 1651717 mfoste1
mfoste1's picture

watch the EU come begging the fed for help with taxpayer dollars

Fri, 09/09/2011 - 14:06 | 1651728 Temporalist
Temporalist's picture

Bloomberg's Matt Miller just said they herd from Zerohedge about Der Spiegel's report.

Fri, 09/09/2011 - 14:36 | 1651882 dcb
dcb's picture

the entire take home lesson fropm lehman is "keep dropping the market until you get what you want (if you are a bank)

think about it, trigger a greek default, get your cdes protection paid, take the bonds, have them traded ibto the ecb (will get a fair percent here because they are so afraid), and those who get in trouble for writing cds will get bailed out. If done right the banks can make money from the tax payer three ways here. the Goldman sachs trick!!!

Fri, 09/09/2011 - 14:36 | 1651884 tj3
tj3's picture

68,000 FDP members.

Nowhere is FDP defined; versus say, European Stability Mechanism (ESM).

Fri, 09/09/2011 - 16:01 | 1652279 Roger Knights
Roger Knights's picture

Free Democratic Party. (Free market.)

Fri, 09/09/2011 - 14:40 | 1651904 bankruptcylawyer
bankruptcylawyer's picture

fellas fellas, this is about italy and spain not greece. 


and the domino idea , while correct, is not a good analogy because dominoes are all of  the same size and tend to fall at a constant speed on one another. 


greece is a smidgeon of italy and spain. and it will not knock them over that quickly. these things take time.

Fri, 09/09/2011 - 15:48 | 1652222 Stack Trace
Stack Trace's picture

Is it a bad idea to short the Euro at this stage?

Fri, 09/09/2011 - 16:02 | 1652282 Roger Knights
Roger Knights's picture

Lots of downside. Not much upside.

Fri, 09/09/2011 - 16:39 | 1652435 phuckingphed
phuckingphed's picture

Coincidence that one of the worst bankers in Europe is about to take the helm at the ECB? Mario Draghi, the governor of the Bank of Italy, will succeed Jean-Claude Trichet, whose eight-year term is ending in October. This reminds me of when Tim Geithner got promoted to Treasury Secretary after completely botching his job as NY Fed president.

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