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We Have A Deal!

Tyler Durden's picture


We just may have a deal:

  • EU official, who wished to remain anonymous, tells Bloomberg that euro-area leaders are set to approve accord for 50% writedown on Greek bonds

If true, this means that Portugal, Ireland, Spain and Italy will promptly commence sabotaging their economies (just like Greece) simply to get the same debt Blue Light special as Greece. It also means that, at least according to Barclays, we have a CDS credit event, although we are certain that Europe would never announce this deal unless ISDA (complete determinations committee list here) was onboard, and corrupt as always. In addition, Greece was unable to generate a 90% acceptance for a 21% haircut tender offer. And we are somehow supposed to believe they can do it with 50%? Lastly, as a reminder, on September 14, Moody's put SocGen, BNP and Credit Agricole on downgrade review. This will be the trigger


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Wed, 10/26/2011 - 21:30 | 1815203 ForTheWorld
ForTheWorld's picture

Could this be linked to the ceasation of trading at the ASX? Surely they wouldn't pull the same tricks as the NYSE?

Wed, 10/26/2011 - 21:33 | 1815235 anynonmous
anynonmous's picture

Black Thursday (opposite)

Wed, 10/26/2011 - 21:39 | 1815278 johngaltfla
johngaltfla's picture

Uh, maybe not.

About all that CDS out there....

And doesn't this make the idea of PIIGS issued RMBS and CMBS like, worthless now?


This reeks of 2008 all over again; put a bandaid on a severed leg then tell the poor SOB to go run a marathon.

Wed, 10/26/2011 - 22:22 | 1815490 Mactheknife
Mactheknife's picture

And the ES ramps 12 points..LMAO. Folks, this is just the end of the "beginning" of the end.

Wed, 10/26/2011 - 23:46 | 1815883 The Big Ching-aso
The Big Ching-aso's picture

So help me out here.

Private bondholders 'voluntarily' took a 50% or thereabouts haircut and they're ok with this? I gotta wonder just how 'voluntary' this agreement is.

And I guess the message to the rest of the PIIGS is that if 50% didn't cause an end of the world ruckus then hells bells lets haircut their private asses by 90%.

It's apparently not such a good time to be a bondholder. Hell the recent past wasn't so good either. Just ask GM's bag holders.

Where in the hell is bond money going to come from now?

Wed, 03/21/2012 - 04:45 | 2276047 l.hauri
l.hauri's picture

I have the same opinion, but I am sure that they will change something in the future.
timeline covers

Wed, 10/26/2011 - 21:41 | 1815285 Ahmeexnal
Ahmeexnal's picture

Kinetic economic collapse action!

Wed, 10/26/2011 - 21:52 | 1815339 crazyjsmith
crazyjsmith's picture

So what happens when your Neighbor gets a loan modification on his house - cutting the principle by 50%, and you don't?

Let's ask Portugal, Ireland, Spain, Italy that same question.

Wed, 10/26/2011 - 21:56 | 1815363 Spastica Rex
Spastica Rex's picture

Yeah - there goes my wife's latest kitchen remodel and my new motorcycle. FUCK THAT!

Wed, 10/26/2011 - 21:57 | 1815367 Ahmeexnal
Ahmeexnal's picture

First step in all hyperinflationary events: your money is suddenly worth 50% of what it was supposed to be worth.


Wed, 10/26/2011 - 22:01 | 1815392 Dr Zaius
Dr Zaius's picture

Wouldn't this be highly deflationary? 50% of the debt is just being written off and such deleveraging events are usually associated with deflation.

Wed, 10/26/2011 - 22:08 | 1815425 Unprepared
Unprepared's picture

That's when they start to print like mad

Wed, 10/26/2011 - 22:15 | 1815461 hungrydweller
hungrydweller's picture

And yet ES is ++++++++++++

Short Time Bitchez!!!!!!!!

Mon, 03/26/2012 - 14:42 | 2291911 l.hauri
l.hauri's picture

It is a really nice approach. Maybe we should do it more often. hotels in harrow

Wed, 10/26/2011 - 22:57 | 1815670 tekhneek
tekhneek's picture

Yes but as most deflationists seem to ignore: You have to pay for that write-off somehow.

Wed, 10/26/2011 - 22:05 | 1815409 greensnacks
greensnacks's picture

US, Japan, Brazil, Australia, Europe all cutting rates at the same time? what could possible go wrong?

Wed, 10/26/2011 - 22:50 | 1815627 cdude
cdude's picture

Not your money but your investment that would suddenly be worth 50%...seems, if either, points more in a deflationary direction.

Wed, 10/26/2011 - 23:23 | 1815760 akak
akak's picture

If I read even ONE more idiot bringing up the non-existent "threat of deflation", my head is going to explode --- hyperinflate, as it were.

When will you fuckers ever examine or understand monetary history, and realize that THERE IS NO FUCKING DEFLATION, NOR HAS THERE EVER BEEN, NOR WILL THERE EVER BE, DEFLATION UNDER A FIAT MONETARY REGIME?!

Thu, 10/27/2011 - 03:03 | 1816205 Libertarians fo...
Libertarians for Prosperity's picture



You are a psychotic idiot.  

If you think deflation can't happen under a fiat money system, then what the fuck do you think happened in 2008/9?

Why do you think Bernanke is desperately trying to re-capitalize the banking system and inflate the economy?  Because of the threat of inflation?

It's difficult for me to fathom how someone could be so knee-buckling stupid, and, simultaneously, so brash about it.

That, coupled with your obnoxious, overly extreme "piss on their grave" animosity toward individuals who are supposedly "complicit" in the destruction of this country because they make bullish stock recommendations, and it quickly becomes obvious that you're just fucking out-of-this-cosmos psychotic.  







Thu, 10/27/2011 - 03:53 | 1816264 akak
akak's picture

Thanks for displaying your complete ignorance of monetary matters, you clueless, disingenuous, malicious, mother fucking piece of shit asshat troll.

Bernanke is desperately (and ultimately, unsuccessfully) trying to save the bloated, TBTF banks because, well, he is a banker, and wii do anything, ANYTHING to save his elitist cronies in crime.  But that has nothing to do with any putative, chimerical, mythical "deflation" --- which I emphasize, again, has NEVER once been seen under a fiat monetary regime in all of monetary history.

No, we did NOT see nor experience deflation in 2008, you statist, Keynesian bastard.  Deflation is a decline in the total stock of money, NOT a temporary deleveraging event.  But thanks for discrediting yourself, for the 472nd time (under your latest troll handle, not your previous five or six sockpuppet aliases here).

Thu, 10/27/2011 - 03:54 | 1816283 Libertarians fo...
Libertarians for Prosperity's picture



No, we did NOT see nor experience deflation in 2008....



Thu, 10/27/2011 - 04:05 | 1816293 akak
akak's picture

Almost as hilarious as those utterly clueless, statist, Keynesian fucks like you and "Caveman" Krugman who continue to insist that up is down, black is white, debt is money, and the solution to overindebtedness is taking on yet more debt.


Now, after discrediting yourself yet again so thoroughly, why don't you go change your handle here and come back pretending to be somebody else, as has been your pattern for the last two years now.

Thu, 10/27/2011 - 04:14 | 1816302 Libertarians fo...
Libertarians for Prosperity's picture



Discredit myself?  WHAT? !!


Even if we were to accept your one-dimensional definition for deflation, you're still wrong.

Dude, you are dumb. And psychotic. 

*LOL* at YOU!


Edit in:  I just noticed you edited OUT your definition of deflation!  *LOL*

CLUELESS!!!! You're so passionate about your stupid, one-dimensional definition, yet you quickly edited it out because you realized how FUCKING RIDICULOUS YOU ARE!!



Thu, 10/27/2011 - 04:35 | 1816309 akak
akak's picture

Oh my God.

You are truly the most embarrassingly stupid fucking troll I have ever encountered.

Obviously, you do not know how to read a graph.  If, however, you ever do learn to do so, you will see that while (the now officially unreported) M3 held steady or declined very slightly in 2008 and 2009, each of M1, M2 AND most importantly, the Monetary Base, all increased steeply and radically during that period (hint: you have to look at the shaded areas of the charts, NOT the lines, which represent the moving year-to-year % change in each monetary aggregate, NOT the stock of each.)

I expected you to discredit yourself, but damn, I never expected you to do so so completely!  And served up by you yourself on a silver (ahem) platter!

PS: I edited nothing out of my previous comment, you God-damned fucking liar.

PPS: With that amount of egg on your face, I won't be expecting any further replies from you in this thread, as at this point you could only dig the hole of your laughable monetary ignorance and non-crediblity that much deeper.  Ta ta.

Thu, 10/27/2011 - 05:06 | 1816340 Libertarians fo...
Libertarians for Prosperity's picture



Dude... there's nothing subtle or slight about those charts.  

You really don't have any idea what you're talking about.  If a central bank wants to decrease the monetary base, all it needs to do is increase reserve requirements. 

Go midway down the page to "Reserve Requirements."

Your one-dimensional definition of deflation is ridiculous.  You can't read those charts, at all.  You're contradicting yourself from one post to the next, and you have no understanding of what the "monetary base" is, nor do you understand how it can fluctuate - up OR down.  

This was hilarious for about 5 minutes.  Now it's just pathetic. 


Thu, 10/27/2011 - 06:10 | 1816365 Hephasteus
Hephasteus's picture

Psychotic is a relative phenomenon. Say if you are psychotic and suffered a loss of reality of what akak is refering to as a strong historical dataset involving massive relentless inflation interupted by about 2 weeks in the 30's when eggs dropped a few percent in their price. So you're right there is a psychosis going on here. It's just that you are the one involved in it.

But technically you both are wrong. In any money tightening situation even on relative basis which we currently are in. There is about at least a 20 percent drop in money supply to american households. In any situation like that you get simultaneous inflation and defaltion. The consumer gets it as inflation if they are only purchasing things that they require. The people yet unaffected by the tightening supply get it as deflation becaue they see their favorite luxury or non-essential goods dropping in price due to massive margin compression. The states get it as seeing massive tax revenue drops to their coffers because corrupt corporations continue collecting sales tax they just don't pay them to the state. Oh they pay but they lie about how much they collected and keep the exess taxes to battle the margin compression they are suffering from. I'm not saying wal-mart is doing this but if you checked them. You'd probably see that they are as they do not follow the inflation margin compression curves without them doing it. McDonalds is definitely doing it.

"If a central bank wants to decrease the monetary base, all it needs to do is increase reserve requirements."

You're living in history books. The most effective way to tighten monetary supply in ponzi bank fuck world is to stop ipo's. Record IPO's shattering 2007 records in 4th quarter 2010 resulted in massive inflation in 4th quarter 2010. That was to give the corporations free money so they could go on pretending they aren't getting margin compressed to death. The IPO's are faltering and there's been no significant ipo's for months. I think there have been 2 and people keep joking about the groupon ipo. So you see that's why people are nervous. Because the free money IPO ponzi tap has been turned off. And corporations are going from make shit up sales figures to make up a whole lot less shit sales figures. 3 years into this depression and the money tightening is making it's second visit to the chosen gangs of commerce.

There's not going to be much inflation ending out this year as long as the IPO ponzi orgy is shut down. But if it's shut down too long or too much then they will start kicking millions more out in the streets who will then look around and see "inflation" as they are no longer spending most of their money on useless crap.

I also just wanted to add the following tidbits. If the tightening to corporations continues the results based on their past behavior will be this. Massive firings. States suddenly bitching about tax revenue and having fucked up budgets because the corporations are stealing it. State defaults, Bankruptcies and lower gold prices. Because less people with less dow jones largesse will be out there fucking over the system that is designed to be thier fuck people over pathway by snatching up gold with the largesse.

Fri, 11/11/2011 - 00:40 | 1868977 haibop
haibop's picture

and the next ten years won't look that great... memory foam mattress

Wed, 10/26/2011 - 22:29 | 1815513 Comay Mierda
Comay Mierda's picture

sounds like a haircut with a chainsaw

Wed, 10/26/2011 - 21:43 | 1815298 TheFourthStooge-ing
TheFourthStooge-ing's picture

Expect a denial soon. I think the half-life of "deal reached" leaks/rumours is around ten hours.

The actual deal, to be announced on Friday after the markets close, will be an agreement to roll the calendar year back to 2010.


Wed, 10/26/2011 - 21:49 | 1815328 DormRoom
DormRoom's picture

another trial balloon to gauge the market?

Sat, 11/26/2011 - 11:49 | 1915109 haibop
haibop's picture

nice to see what to happen walk in cooler

Wed, 10/26/2011 - 21:49 | 1815332 wisefool
wisefool's picture

I see what you did there!

Sat, 11/19/2011 - 14:38 | 1894319 haibop
haibop's picture

I really enjoy reading these interesting posts. walk in freezer

Wed, 10/26/2011 - 22:09 | 1815431 Fidel Sarcastro
Fidel Sarcastro's picture

A  BONA-FIDE  D.E.F.A.U.L.T  and the f*cking market explodes...AGAIN!

Wed, 10/26/2011 - 22:12 | 1815444 i root for that...
i root for that fat jersey governor's picture

damn I closed my long and opened short today - TOO early! should stay long to eat those suckers lunch.

Tue, 12/06/2011 - 23:12 | 1953564 haibop
haibop's picture

This is always tomorrow :) range hoods

Wed, 10/26/2011 - 21:55 | 1815359 myne
myne's picture


As bad as it sounds, the sooner the entire PIIGS group and any other insolvent entities fail, the sooner the fire burns out.

The phoenix cannot rise from the fire. It HAS to rise from the ashes.

It'll suck for a few years, but it will be over and done with.

Wed, 10/26/2011 - 21:57 | 1815368 JLee2027
JLee2027's picture

A quick collapse is preferable to a slow lingering death in my book.

Wed, 10/26/2011 - 22:11 | 1815441 max2205
max2205's picture

12/31/2011 = all time SPX highs. FUCK

Wed, 10/26/2011 - 22:29 | 1815519 zorba THE GREEK
zorba THE GREEK's picture

Max, you may get a spx high, but not adjusted for the newly devalued currency.

Wed, 10/26/2011 - 22:22 | 1815489 Melin
Melin's picture

Yes...a quick collapse would've been preferable.

Wed, 01/18/2012 - 23:15 | 2076841 haibop
haibop's picture

how sad.. junk car for cash

Wed, 10/26/2011 - 21:57 | 1815369 Spastica Rex
Spastica Rex's picture

Phoenix is so 20th century.

Wed, 10/26/2011 - 22:07 | 1815423 kito
kito's picture

especially with their water shortage, mega dust storms and high crime rates. you would be a fool to move there...

Tue, 03/20/2012 - 09:05 | 2272781 l.hauri
l.hauri's picture

this seems to be a good deal. Maybe we can cooperate.
yacht charter dubrovnik

Wed, 10/26/2011 - 22:23 | 1815497 Sequitur
Sequitur's picture

Kudos to the Tylers: you got this out fast.

Sun, 12/11/2011 - 20:01 | 1968567 haibop
haibop's picture

real fast! electric fireplace

Wed, 10/26/2011 - 21:31 | 1815204 anynonmous
anynonmous's picture


Wed, 10/26/2011 - 21:33 | 1815236 caerus
caerus's picture

no shit...i'm on bullshit overload...cheers!

Wed, 10/26/2011 - 21:36 | 1815261 Milton Waddams
Milton Waddams's picture

Confirmed.  This 50% off deal on Greece bonds was today's Groupon.  The deal is on!

Wed, 10/26/2011 - 22:06 | 1815413 crazyjsmith
crazyjsmith's picture

Yes, ZERO is on sale today. Get ZERO at a blowout sale
50% OFF!! All ZEROS must go!

Yes you heard it right folks, you get nothing, but you get it for 50% OFF! But only for a limited time, while suppLIES last.

50% x $0 = $0

Fri, 03/16/2012 - 23:57 | 2264352 haibop
haibop's picture

impressive 48 gas range

Wed, 10/26/2011 - 21:36 | 1815207 bob_dabolina
bob_dabolina's picture



They are going to fuck this shit up soooooooooooo bad.

This doesn't even make sense from a math perspective.

You won't even need CDS...this will blow itself up.

Wed, 10/26/2011 - 21:42 | 1815290 chump666
chump666's picture

yeah they are 100% going to f*ck this up, now they gotta get that fund going over 1trillion just to shore up banks.  French and German borrowing costs will go into hyperspace

Wed, 10/26/2011 - 21:49 | 1815322 bob_dabolina
bob_dabolina's picture

I want my credit card debt cut in half.

I want ALL my debt cut in half.

Oh, I owe a million? FUCK YOU it's $500,000 now bitch.

Wed, 10/26/2011 - 21:52 | 1815341 wisefool
wisefool's picture

The USA owes 13T. it is now 7T. suck it. And I am now going to file corrected tax forms to refletct as much.

Wed, 10/26/2011 - 21:54 | 1815353 bob_dabolina
bob_dabolina's picture

7 trill? Bitch please...let me cut that shit in half

3.5 trill...and ya know what? I don't even wanna pay that mother fucker. Better come up with a fuckin' plan. 

Wed, 10/26/2011 - 21:56 | 1815365 Sequitur
Sequitur's picture


You still posting fake trades at Still using that practice account, pretending you got loot at risk?

Wed, 10/26/2011 - 22:00 | 1815379 bob_dabolina
bob_dabolina's picture

Thank you for the free advertising.

If you have something to say, say it on my blog....bitch

Wed, 10/26/2011 - 22:05 | 1815407 Sequitur
Sequitur's picture

Why waste time on that fake piece of shit, when we can prove, right here, the BS. Namely, here's one of YOUR images, taken from YOUR blog, of your purported trading account:

Yeah, see that "Reset All Positions" button? You only get to exit, or "reset" all your positions in a fake/paper/play account. Exposed.

Now shut the fuck up and leave the discussion to the adults.

Wed, 10/26/2011 - 22:16 | 1815435 bob_dabolina
bob_dabolina's picture

Spend your time doing something productive. 

Here is a real post...this is a real post, from my blog on my blog. I'm not arguing this anymore.

Post something other than a photo shopped screen shot. 

(yes that -75 /es is still open)

Wed, 10/26/2011 - 22:20 | 1815481 Sequitur
Sequitur's picture

Happy to oblige. Here's another one you put up, purportedly of your "real account."

Mmm, directly from your site. Except you were too fucking stupid to realize those big fat zeroes under buy/sell, positions, and your P/L open and P/L day all show big, fat zeroes. Lawlz, your so-called multimillion dollar account has gooseggs for money at risk, profit/loss in positions, and zero money made on the trading day.

Listen fucker, you're out of your league here. You've been exposed multiple times, we saved your entire site before you started photoshopping images, and I know -- and YOU know -- these images came from your site. You're a fraud, you don't know jack shit about trading, you can't even conceal a paper-trade account. What a fucking rookie mistake, posting your shit on a site where many traders hang.

You're a liar. A bad liar. Now run the fuck along to the kids table at Thanksgiving dinner, the adults are trying to make money and preserve wealth.


Wed, 10/26/2011 - 22:32 | 1815520 bob_dabolina
bob_dabolina's picture

Except you were too fucking stupid to realize those big fat zeroes under buy/sell, positions, and your P/L open and P/L day all show big, fat zeroes.

You stupid....stupid....stupid shit. I didn't HAVE any positions when I posted that. You must have shit in your brain. 

And listen you stupid cunting faggot, I don't give a shit if you think I'm lieing. 

Like I've told everyone follow my blog....or don't....or SHUT THE FUCK UP. 

You're a stupid cunt. That's all I have to say.

Wed, 10/26/2011 - 22:38 | 1815552 Sequitur
Sequitur's picture

Liar, you posted that very image when you said you made a killing on some gold options. In fact that very IMAGE refutes you -- because you've got the Dec 11s on the /gc selected.

Also, further proof how fucking dumb you are: you see that "Net Pos: 0" up in the top right corner? Yeah, if you were all in cash, your "position" would reflect your NET cash balance. Hence if you had the millions you say, you'd net to your cash position. See that zero? You got ZERO. Zero at risk. Zero on the trade you were highlighting. Zero profits and loss. Zero in cash. A NET zero position, including cash. ZERO. ZERO.

Fucking tard. I don't need to "think" your lieing. I know you're lieing, and you proved it. We all know you're a liar.

Exposed. Again.

Wed, 10/26/2011 - 22:48 | 1815607 bob_dabolina
bob_dabolina's picture

Liar, you posted that very image when you said you made a killing on some gold options

I've never in my life traded a gold option. 

Can you please tell me where I did so? 

When you can do that, I'll call myself a fraud. 

Ya know...I don't even care about your response. Have at it. 

Thu, 10/27/2011 - 06:02 | 1816368 Hephasteus
Hephasteus's picture

Ya. Of course you don't care. You're too lazy to not use the same stupid crap lie that you got caught in the first time.

Wed, 10/26/2011 - 21:58 | 1815371 wisefool
wisefool's picture

1.75 trillion and I and done yet. Bring it tough guy.

Wed, 02/15/2012 - 23:49 | 2164750 haibop
Wed, 10/26/2011 - 22:12 | 1815449 peekcrackers
peekcrackers's picture

you can have your credit card cut in half as long as They can hike your water rate by 65% and you can have all your debit cut in half as long as your children are willing to pay with there souls. sound good?

Wed, 10/26/2011 - 21:43 | 1815300 deebee
deebee's picture

that's real power - everyone knows how deeply fucked up yet it happens anyway

Wed, 10/26/2011 - 21:59 | 1815381 Sequitur
Sequitur's picture

Keep posting fake trades at

Keep pretending you have money at risk on your practice account.

Sat, 12/24/2011 - 03:30 | 2008937 haibop
haibop's picture

so bad? mini fridge

Wed, 10/26/2011 - 21:31 | 1815209 peekcrackers
peekcrackers's picture

Got Gold ?

Wed, 10/26/2011 - 21:31 | 1815210 Esso
Esso's picture

We'll see...

Wed, 10/26/2011 - 21:31 | 1815211 Alexmai
Alexmai's picture

Is that mean greece finally default?

Wed, 10/26/2011 - 21:40 | 1815232 peekcrackers
peekcrackers's picture

i think its the 6 time or something like that. I lost count around "almost dedult" number 3.5 in the summer

Wed, 10/26/2011 - 21:35 | 1815249 navy62802
navy62802's picture

Oh no! You didn't just call it a default! Use of that word has been prohibited when talking about Greek debt. The correct term is "haircut."

Wed, 10/26/2011 - 21:40 | 1815281 CrimsonAvenger
CrimsonAvenger's picture

Right - a haircut right down to your torso.

Wed, 10/26/2011 - 21:51 | 1815337 peekcrackers
peekcrackers's picture

Umm ok so lets just call it what the real name should be
dry ass rape

Wed, 10/26/2011 - 21:55 | 1815356 crazyjsmith
crazyjsmith's picture

Yes, a haircut. And your barber will be a Native American, Chief Rusty Blade.

Wed, 10/26/2011 - 22:17 | 1815468 I Got Worms
I Got Worms's picture

A haircut in the same sense that Lorena Bobbit gave John a haircut.

Wed, 10/26/2011 - 22:24 | 1815498 greensnacks
greensnacks's picture

Does that mean Greeks will actual go back to work and start paying their bills?

Wed, 10/26/2011 - 22:52 | 1815638 MS7
MS7's picture

They are protesting because their jobs are being cut and they do not have the money to pay bills. Your asking that question is similar to Marie Antoinette's alleged remark "Let them eat cake".

Wed, 10/26/2011 - 22:31 | 1815531 knukles
knukles's picture

Well, by any "normal" definition of default, yes.  Just like NYC's moratorium, GM and Chrysler's restructuring (nationalization and redistribution to unions), yes.  Emphatically, Yes.
Any deleterious change to the terms of the deal, interest rate, medium of payment, maturity, etc.
So, whose gonna call an event of default?  What jurisdiction?  Get my drift?  In the case of GM et al, the jurisdiction was the US and as it was the US government itself abrogating debt-holders rights AND told the debt holders to sue if they wanted and reminded them that the Government had infinite taxpayer funds to litigate....  Get my drift?
But yes.  It's an event of default.  Period.
Let us further examine the intrusion so insidiously imposed upon us by the so called rules makers and enforcers.  ISDA officially decides whether all of such contracts governed thereunder are triggered.  Swaps whether interest rate, credit default, etc.  If they say no, then I say (and I hereby appoint myself independent arbitrator as I have no fucking interest whatsoever other than the need to ridicule) the purchaser if the "insurance" gets screwed.  Shoulda been paid off but didn't happen.  Where ya gonna get relief?  What jurisdiction?  Owwweee!

So, by my stodgy olde fashioned pre-fuckupumbian modern interpretation of laws enforced to fuck everybody but he monied interests, this is an event of default and should trigger contracts. 

Wed, 10/26/2011 - 23:06 | 1815718 jdelano
jdelano's picture

Doesn't this make all sovereign CDs worthless instruments and therefore render the hedges of firms like MS worthless, meanin in essence that ms no has billions in unhedged exposure?

Wed, 10/26/2011 - 23:28 | 1815810 azusgm
azusgm's picture

How about BAC? What does that teetering toxic tower have on its derivative books?

Wed, 10/26/2011 - 23:51 | 1815902 knukles
knukles's picture

Tee heh....  Yorp....
Law of Unintended Consequences is Gonna Bite Real Fucking Hard.
And in more spots then anybody can imagine.... as is always the case.
This one just be way the fuck bigger.

But, yes.
Insofar as I've read, the ECB, ESFS (or fuck wgatever they're calling their CDO7) etc don't have to mark to market/realize haircut (what a fucking sham  Jesus H Fucking Christ) but, like you just asked, what about MS, GS, JPM, etc?
Owwweeee!  Wonder what and who gonna be the arbiter of that piece of shit sucking conundrum?  FASB, SEC, FED, CoC?  Who?

This is EU's GM moment.
The whole credibility of the Euro and Rule of Law in EU is destroyed.
Remember, it was the politicians who git the US downgraded.  Everybody already knew the financials, but when the noble statesmen who guide us talked of a default which was not in the cards, well, not much else to do.
Hello France?
Hello EU bank capitalizations?
Hello ECB reality of broken balance sheet.  It's been Zimbabwefied. 

Wed, 10/26/2011 - 21:32 | 1815214 beastie
beastie's picture


Is it true this time or are we going to have a denial in 5 minutes?

Wed, 10/26/2011 - 21:37 | 1815266 TheFourthStooge-ing
TheFourthStooge-ing's picture

A time-to-denial betting pool might be fun.


Wed, 10/26/2011 - 21:59 | 1815384 peekcrackers
peekcrackers's picture

the denial is the debit and as greece is fetal position taking a hot shower from one more ass raping.

Wed, 10/26/2011 - 21:31 | 1815216 Central Bankster
Central Bankster's picture

only 50%? Guess the greek bond speculators will make out nicely.

Wed, 10/26/2011 - 23:09 | 1815725 tekhneek
tekhneek's picture

Fiat's a bitch, ain't she?

Wed, 10/26/2011 - 21:32 | 1815220 trade the day
trade the day's picture

50%. When do I get my 50% haircut? Oh boy how exciting

Wed, 10/26/2011 - 21:32 | 1815223 RobotTrader
RobotTrader's picture

Looks like NY Composite is going to blast right up to the 200-day and clear it tomorrow.

Wed, 10/26/2011 - 21:44 | 1815307 Central Bankster
Central Bankster's picture

Hah! good to know momo fader is on the other side of my trade... whew!

Wed, 10/26/2011 - 21:56 | 1815362 DarkestPhoenix
DarkestPhoenix's picture

And take NFLX back up into its highs, I'd reckon!

Wed, 10/26/2011 - 21:58 | 1815376 Spastica Rex
Spastica Rex's picture

What are your thoughts on Buy?

Wed, 10/26/2011 - 22:35 | 1815545 knukles
knukles's picture

I'd like a large wet liver, a large container of lotion, a box of Kleenex and some hand sanitizer.
Oh, I almost forgot, a 1.75 of Smirnoff and Lindsay Lohan.

Wed, 10/26/2011 - 22:53 | 1815640 pods
pods's picture

Knuckles, you sir KNOW how to party!


Wed, 10/26/2011 - 22:10 | 1815433 Banksters
Banksters's picture

Still trying to get the tip of your cock in side eh robo.

Wed, 10/26/2011 - 21:33 | 1815224 lizzy36
lizzy36's picture

So 21% in June becomes 50% in October become 80% in January?

if a 50% loss on Greek debt does not trigger a credit event - what is the CDS worth?

Wed, 10/26/2011 - 21:35 | 1815251 anynonmous
anynonmous's picture

On a long enough timeline...

Wed, 10/26/2011 - 22:00 | 1815387 LongBallsShortBrains
LongBallsShortBrains's picture

Same as a house..... Whatever you can get the next idiot to pay for it.

Wed, 10/26/2011 - 22:16 | 1815465 oogs66
oogs66's picture

Sovereign CDS is now a waste

Wed, 10/26/2011 - 22:35 | 1815533 Iam_Silverman
Iam_Silverman's picture

"what is the CDS worth?"

What is it worth?  Probably ZERO!  That's right, nothing.  Remember, the CDS will only pay out in the event that the ISDA determines a default has occurred.  I work for a company (formerly TXU, now EFH) that in effect defaulted on lots and lots of bonds.  Some investors got angry and asked for their "insurance payout".  The agents broker said no.


See: ... and

You see, if it aint over til the fat lady sings, her manager will keep her backstage until he's ready for the curtain to drop.

Wed, 10/26/2011 - 21:32 | 1815227 kito
kito's picture

so does this mean that guys like kyle bass get deeply screwed if they claim "no credit event"? isnt the definition of a "credit event" written into the fine print when purchasing swaps? who gets to decide what a "credit event" is? 

Wed, 10/26/2011 - 21:37 | 1815265 chump666
chump666's picture

a 50% haircut is a credit event! Merkel/French guy have set up the default, now they got to keep the banks afloat as they will drain out liquidity from the EZ.  They will have to leverage the ESFS to hell. 

Wed, 10/26/2011 - 21:46 | 1815315 kito
kito's picture

tyler mentioned that the isda had to be on board for this. i take that to mean they will interpret this as a "non credit event". can that be? can the isda interpret favorably for the sovereigns to avoid a trigger? if not, then what does it matter whether the isda is on board or not?

Wed, 10/26/2011 - 21:57 | 1815358 DormRoom
DormRoom's picture

ISDA is the body that determines if an event is a credit default.  The determinsation committes is like an umpire.  What they 'call' becomes 'real'.



Wed, 10/26/2011 - 21:59 | 1815377 kito
kito's picture

right, which brings me back to my original point. guys like bass and other holders of swaps can get f-cked if the isda colludes with the eu and decide this is a "non credit event". that seems insane, but that iseems to be what tyler is saying by stating the isda is likely on!?!?

Wed, 10/26/2011 - 22:12 | 1815450 chump666
chump666's picture

in four, maybe five hours the European credit markets open.  Check there, they blow out, then something is up. 

Wed, 10/26/2011 - 22:13 | 1815451 pods
pods's picture

On the bright side, we won't have to worry about further issuance of swaps?


Wed, 10/26/2011 - 22:24 | 1815492 chump666
chump666's picture

Sarkozy on wires acting like the madman he is clamining the ESFS will be three times leveraged, i dunno whats that 3trillion?

What an idoit, now French and Germany borrowing costs go up as he goes to meet with Chinese french dude, seen iron ore prices lately? They are collpasing! That would seem that China is looking pretty screwed.


Wed, 10/26/2011 - 22:39 | 1815576 knukles
knukles's picture

(maniacal laughter)

thought balloon: (just getting fucking worse by the hour.)

Wed, 10/26/2011 - 22:40 | 1815569 Iam_Silverman
Iam_Silverman's picture

"ISDA is the body that determines if an event is a credit default."

That is correct.  Also, take a close look at who sits on the determination committee!  In the case of the EFH re-issuance (pseudo-default) the largest stakeholders turned one of the smaller guys into a bagholder..  Of course they would vote no - they may have even written some of the CDS covering the EFH bonds (rumored).

Wed, 10/26/2011 - 21:50 | 1815334 Wannabee
Wannabee's picture


Remember, wer'e playing Calvinball. Credit event is an event until it isn't

Wed, 10/26/2011 - 22:12 | 1815443 midgetrannyporn
midgetrannyporn's picture

right. a credit event is only a credit event if it benefits the right set of people. heads they win, tails we lose.

Wed, 10/26/2011 - 22:37 | 1815553 Dr Zaius
Dr Zaius's picture

Yep, sounds like Calvinball.

Wed, 10/26/2011 - 21:34 | 1815231 OldPhart
OldPhart's picture

So tomorrow will be:



Wed, 10/26/2011 - 21:39 | 1815275 navy62802
navy62802's picture

Just in time for Halloween too! Get the popcorn ready. If this report of a deal is true, the show has only just begun. Sit back, relax and enjoy!

Wed, 10/26/2011 - 21:33 | 1815234 Ciliano
Ciliano's picture

Whoa that eurusd spike while I was in the bathroom hit my entry limit sale pretty much exactly

Wed, 10/26/2011 - 21:33 | 1815237 Threeggg
Threeggg's picture

So, just a haircut and "No"-triggering of the CDO's and CDS's ?

No default ?

Wed, 10/26/2011 - 22:03 | 1815395 Manthong
Manthong's picture

Louis XVI did not consider his haircut a default.

Wed, 10/26/2011 - 22:42 | 1815585 knukles
knukles's picture

nor Samson

or Custer

Wed, 10/26/2011 - 21:33 | 1815239 chump666
chump666's picture

Exactly, plus banks will start to drive funds out of the PIIGS/EZ.  Nice.  Bet is on Greece leaves, then Italy, then Spain etc.  Bund/PIIGs spreads should widen on this after knee jerk buying will turn to selling.

Look forward to S&P credit default on Greece.  C'mon Europe time to face the chaos

Wed, 10/26/2011 - 21:34 | 1815242 Seize Mars
Seize Mars's picture

Wait wait wait


Does this mean that bank-owned Greek bonds get a different haircut (and so they can remain solvent)???

Wed, 10/26/2011 - 22:44 | 1815605 Seize Mars
Seize Mars's picture

50% Haircut does not apply to ECB holdings of Greek bonds

Wed, 10/26/2011 - 22:58 | 1815675 pods
pods's picture

Hasn't everyone in Europe puked their Greek bonds to the ECB already?


Wed, 10/26/2011 - 21:34 | 1815243 JSchroe
JSchroe's picture

Buying Opportunity

Wed, 10/26/2011 - 21:34 | 1815244 jcaz
jcaz's picture

This works... Until Nov 1.....

Wed, 10/26/2011 - 21:35 | 1815246 I am a Man I am...
I am a Man I am Forty's picture

a step in the right direction in my opinion

Wed, 10/26/2011 - 21:35 | 1815252 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

Tut, tut, a precident has been set... who the f**k would now pay 100% of their debt back with interest, when they can hold out for a nice 50% reduction at the very least.

Wed, 10/26/2011 - 21:43 | 1815294 I am a Man I am...
I am a Man I am Forty's picture

people that want to borrow money ever again at low rates

Wed, 10/26/2011 - 22:45 | 1815608 Iam_Silverman
Iam_Silverman's picture

"people that want to borrow money ever again at any rate"

There, fixed it for ya'.

Wed, 10/26/2011 - 22:09 | 1815430 Dr Zaius
Dr Zaius's picture

These people have no concept of "moral hazard".

Wed, 10/26/2011 - 21:35 | 1815257 Gene8696
Gene8696's picture

I did it... By shorting S&P today...

Wed, 10/26/2011 - 21:38 | 1815262 Christoph830
Christoph830's picture

Sell the news!

Italy's pathetic austerity package finally makes sense now.  Why implement true austerity when you can just ask for a 50% or more haircut?!???


Wed, 10/26/2011 - 21:43 | 1815301 Ahmeexnal
Ahmeexnal's picture

Seems like bunga-bunga cavalieri ain't such a dumbshit after all!

Wed, 10/26/2011 - 22:46 | 1815613 bxy
bxy's picture

I traded on the CBOE from 1994 - 2001 and I thought the firms manipulated and fucked with is now 100x worse.....The entire market is now complete bullshit....Hedge fund, Cyborg chaos.

Wed, 10/26/2011 - 21:37 | 1815263 treasurefish
treasurefish's picture

EXACTLY 100 years ago, there was a Tyler Durden, but his name was Alfred Owen Crozier.

There was also a William Banzai.  His name is lost to history, but his artwork remains!!!!

Wed, 10/26/2011 - 23:55 | 1815918 Bring the Gold
Bring the Gold's picture

Wow, what a find treasure fish and it's free to download. That book might as well have been written by Nostradamous. The person knew exactly what has happened 100 years in advance, amazing.

Wed, 10/26/2011 - 21:37 | 1815267 deebee
deebee's picture

So you think the PIIS's will sell their CDS to qualify the need for a bailout, and then use state assets to guarantee debt instead, screwing tax payers locally and abroad (and, indirectly, the entire financial system)?
Sounds terrible, I don't believe they'll do something like that, would they?

Wed, 10/26/2011 - 21:37 | 1815268 RebelYell
RebelYell's picture

It is such a great time to be alive, to be tuned into ZH, to be in cash and PMs, and to have a glorious family!

This is better than a new season of The Walking Dead!

Wed, 10/26/2011 - 22:13 | 1815454 I am a Man I am...
I am a Man I am Forty's picture

just watched the first season on Netflix, pretty good

Wed, 10/26/2011 - 21:37 | 1815269 vote_libertaria...
vote_libertarian_party's picture

This is 50% for the privately held bonds (I think). So it wouldn't wipe out the ECB, etc..

So it may not be as much of a reset as it sounds.

Wed, 10/26/2011 - 21:38 | 1815270 anynonmous
anynonmous's picture

Bloomberg Asia just now

"There's a plan in place to help the Banks shoulder the haircut and that's what's important John"

Wed, 10/26/2011 - 22:15 | 1815460 Dr Zaius
Dr Zaius's picture

Given the recent demonstrations around the world, how can such a plan to bailout the banks yet again be politically possible?

Wed, 10/26/2011 - 23:56 | 1815921 Bring the Gold
Bring the Gold's picture

I think you are still falling for that "Democracy" and "Representative Government" lie. The banks run everything and if people go really nuts it WILL be tanks in the streets time.

Wed, 10/26/2011 - 23:58 | 1815928 Bring the Gold
Bring the Gold's picture

And don't forget the follow up story:


"In an unrelated note, government issued personal defense lubricant budgets for taxpayers has been cut as part of the Austerity package."

Wed, 10/26/2011 - 21:41 | 1815272 earleflorida
earleflorida's picture

i guess when they asked greece to come back, they meant it to go away

sell on the news


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