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The Time To Re-Re-Reban CDS Is Here As Italian Spreads Explode

Submitted by Tyler Durden on 10/31/2011 11:33 -0400

The first three CDS ban attempts have failed. So has the coordinated ISDA attempt to make sovereign CDS a product with absolutely no functionality. The fourth time will be the charm though. The EFSF guarantees it! On the other hand, think of the massive EPS profit that Italy will post this quarter as a result of today's CDS blow out courtesy of the DVA accounting gimmick. Surely Dick Bove will imminently upgrade it to Dodecatuple Turbo Buy.

ITALY           439/447 +38
SPAIN           333/341 +22
PORTUGAL      950/980 +5
IRELAND      675/705 +20
GREECE     53/56 +1
BELGIUM      265/275 +28
FRANCE     172/176 +14
AUSTRIA 139/144 +14.5
UK                  81/85 +7
GERMANY        82/85 +7

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Mon, 10/31/2011 - 11:36 | 1828628 Fips_OnTheSpot

+38 +29 ...? No wait, confused.

Just ban it!

Mon, 10/31/2011 - 11:35 | 1828633 lolmao500

If sources are correct the ECB already intervened at 5:50am this morning in the italian 10 year bonds. But they are afraid to announce it because they had so little effect. It weared off in 20 minutes. If this is true then the Vigilantes will eat the ESFS alive.

Mon, 10/31/2011 - 11:39 | 1828650 slaughterer

ESFS => this winter's "Big Short."

ESFS => downhill skiing from here.

Mon, 10/31/2011 - 11:39 | 1828652 GeneMarchbanks

EFSF is about as alive as MF Global.

Mon, 10/31/2011 - 11:40 | 1828655 topcallingtroll

Aahhh. The return of the bond vigilante. Long time no see. You planning to stick around this time or is this just another quickie?

Mon, 10/31/2011 - 11:46 | 1828658 Zero Govt

You mean EFSF ...Eurozone Financial Suicide Fund

Eaten alive by vigilantes? ...it's going to jump out of the 18th floor at Brussels HQ all by itself

Mon, 10/31/2011 - 11:51 | 1828695 kaiserhoff

Let's make sure no financial information gets out about nobody. That will fix it.

Mon, 10/31/2011 - 12:01 | 1828715 DormRoom

Germany strapped itself to a financial bomb. Greece has signed itself to 7 years of economic depression, thereby brutalizing its citizens. And they can't exit. For if they do, it would set off the EFSF bomb.

Greece cannot adjust its Euro cost by 30% in that time frame, without economic depression, to be competitive.

QED. If Greece exits -> Germany-Greece armed conflicts?

1912. all over again. WE know what the the theatre of war will be

Mon, 10/31/2011 - 12:19 | 1828776 Ghordius

DormRoom, I'm getting war fatigue here.

Explain again, how would Greece invade Germany in your "please have Germany in another war fantasy?"

Or do you really mean Germany would be in any way irate for Greece leaving the EZ?

Do you have any clue abot the two countries except from your comics?

Mon, 10/31/2011 - 12:30 | 1828800 DormRoom

you've misinterpreted my comments.

If Greece exits, it would set off the EFSF bomb, and Germany would face huge loses, after backstopping Europe. So Germany cannot allow Greece to exit.

Therefore, if Greece exits (alleviate the economic depression on its citizen), it would antagonize Germany, possible leading to armed conflict.

This is assuming the bailout passes the legislature.

Mon, 10/31/2011 - 12:10 | 1828752 Innocent Bystander

Apparently ECB did. This is a repeat of August,

Japanese intervention followed by ECB intervention in Spanish / Italian Bonds.

October - Japanese intervention followed by ECB in Italian bonds. So far everything is as per plan.. or is it?

on another note why bother driving the CDS higher, when ISDA has made it irrelevant? food for thought

Mon, 10/31/2011 - 11:36 | 1828636 bill1102inf

GOLD Bitchezzz!!! Is going down.

Mon, 10/31/2011 - 11:49 | 1828690 Zero Govt

Yes Gold's down '1.5% today ...but not as fast as bankers (BNP down -15% today, Soc-Gen down -9%, Deutsche down -8%) or Central Bankers and their Fiat money

it's relative mate ...relative to fraud and insolvency

Mon, 10/31/2011 - 12:02 | 1828733 tmosley

Indicating that it is time to buy.

Of course, I prefer to buy silver, which is still a spectacular bargain.

Mon, 10/31/2011 - 11:37 | 1828638 HoofHearted

Can we leverage up the EFSF 2 trillion times? If so, then we've got plenty of euros to take care of all of this...

Mon, 10/31/2011 - 11:37 | 1828639 irishlink

Belgium is starting to look very shaky indeed ,but it might be ok as there is not a government to screw things up further.

Mon, 10/31/2011 - 11:38 | 1828643 uhb

double plus good

Mon, 10/31/2011 - 11:38 | 1828646 Hard1

Instead of banning them, the authorities are trying to kill the market by making them not an effective hedge. After what they are attempting to make the banks shove down their throats in Greece, anybody who has European credit risk hedged with CDS should be selling the bonds right now!

Mon, 10/31/2011 - 11:42 | 1828664 GeneMarchbanks

They are as we type...

Mon, 10/31/2011 - 11:40 | 1828651 dasein211

Zombie bond market- Bitchez!!

Mon, 10/31/2011 - 11:40 | 1828653 sergei

Ken Rogoff

http://www.youtube.com/watch?v=ESIZMkKLBF4

Mon, 10/31/2011 - 11:40 | 1828654 Irish66

EGAN OCT. 18th

http://www.youtube.com/watch?v=w_hYeXHHrbQ

Mon, 10/31/2011 - 11:41 | 1828656 slaughterer

Could be CDS buying to hedge new risk acquisitions in EZ. But I somehow doubt it.

Mon, 10/31/2011 - 11:41 | 1828659 sergei

Kyle Bass

http://www.youtube.com/watch?v=99aRrF33p0s

Mon, 10/31/2011 - 11:44 | 1828667 Note to self

I thought all soveriegn CDS were disarmed last week. What's goin on?

Mon, 10/31/2011 - 12:04 | 1828730 Zero Govt

it's a political 'solution'

which of course means from hereon everything's going completely fuking pear-shaped

Mon, 10/31/2011 - 11:44 | 1828668 RobotTrader

The time to buy stocks is when credit spreads are blowing out and the news flow is at its worst.

Especially when the tape seems to buck off the worst of the worst news time and time again.

Mon, 10/31/2011 - 11:51 | 1828697 maxmad

Best time to buy, is when ROBO capitulates!

Mon, 10/31/2011 - 12:04 | 1828736 mendigo

You are the true contrarian.

Vaya con Dios amigo.

Mon, 10/31/2011 - 11:45 | 1828672 willien1derland

John Corzine to lead the EFSF - Tragic Irony or Poetic Justice?

Mon, 10/31/2011 - 11:49 | 1828687 Oh regional Indian

I'll take a little of both please.

ORI

Mon, 10/31/2011 - 11:45 | 1828674 CrashisOptimistic

Well, if swaps are neutered and you can't hedge default risk in a bond, then you either don't buy the bond, sell what you have, or if you think your clients are complete morons, you buy the bonds only if you can get 15% on 5 year paper.

The countering wind is the fact that a lot of money is made buying and selling swaps, from a commission perspective. Every one of those salesmen will be screaming into their telephones that the instrument still has value.

They'll lose that battle.

Mon, 10/31/2011 - 11:45 | 1828675 common_sense

Ban bank shorts

Ban CDS

Ban greek bonds

Ban stocks

Ban everything.... Ban free capitalist market, because we go now for a NEW MODERN COMUNISM...CALLED....CHINA !!! so we continue... Ban internet, Ban communication, Ban occupy wall street, Ban Tiannanmen... oh my goc, what a nice futur !!!!

Mon, 10/31/2011 - 11:49 | 1828692 Balmyone

The ECB needs to get to work and start buying up those worthless Italian bonds.

Otherwise, 7% here we come, and then Italy goes with hat in hand for a bailout.

Draghi is Italian, no. Will he turn the printing press on for his homeland.

I wonder if Italian's are buying USD, CHF, JPY, or perhaps GOLD and SILVER.

http://gainesvillecoins.com

Mon, 10/31/2011 - 13:40 | 1828995 FinalCollapse

I think they have voting mechanism in ECB - no? Draghi cannot drag ECB anywhere without German's permission.

Mon, 10/31/2011 - 11:51 | 1828698 Lord Welligton

Surely if the EU introduced a regulation to stop time everything would be just dandy.

Mon, 10/31/2011 - 11:58 | 1828721 BurningFuld

Gold going down? Bahaha. I've got to get more tomorrow. The PRINTING is not far off now boys!

Mon, 10/31/2011 - 12:05 | 1828741 mendigo

Seems like to news flow is coming a little faster now - TSHF?

Mon, 10/31/2011 - 12:10 | 1828754 AngryGerman

centillion euro bailout coming

Mon, 10/31/2011 - 12:23 | 1828771 Saxxon

Whoa, you guys a swarming a bit. This is an orderly selloff and understandable given the runup.

Some of us shorts who have been smoking seeds & stems all month are getting a taste of bud today and getting all kinds of high . . .

I covered this a.m. premarket. Yes, a tad early but we are only back to Thursday in the SPY and I reckon if it can hold 127 the day is a success for the bulls.

Mon, 10/31/2011 - 12:19 | 1828777 vote_libertaria...

yepper...got my 2013 TBT calls. It's a small dollar amount but could definitely pay off big if things get Greek-ified.

Mon, 10/31/2011 - 13:01 | 1828890 Rat King

Robo does appear to have the recipe for happiness down pretty well http://www.youtube.com/watch?v=TgOn7wuC3tk

Tue, 11/01/2011 - 00:42 | 1830872 Tompooz

"This video contains content from EMI, who has blocked it in youThis video contains content from EMI, who has blocked it in your country on copyright grounds. r country on copyright grounds. Sorry about that. The beginning of copyright censorship.

Mon, 10/31/2011 - 16:50 | 1829749 prophet

Insurance - a mechanism whereby the majority of participants pay for something they will not use so that those few who need it will have use of that something.

Pooling of risk is poorly understood.

The Time To Re-Re-Reban CDS Is Here As Italian Spreads Explode

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