We Just Had A "Rerun" Of Bear Stearns: When Is Lehman Coming?

Tyler Durden's picture

As the attached chart showing USD liquidity swap line usage by the ECB, or more specifically by European banks, we have now seen a surge to levels last seen in August 2009. However, more importantly this is where the usage was for the first time after the failure of Bear Stearns, and when everyone thought all had been fixed... until Lehman came. We are there now, in other words, we have just experienced a behind the scenes Bear-type event. What is disturbing is just how fast the rate of change was this time around compared to before, when it took months to get to $50 billion. Now, it was one week. When "Lehman v2.0" hits and it will hit, the next step function in the Fed's global bailout will be so big and so fast, it will induce vertigo.

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GeneMarchbanks's picture

2008 Redux

'When "Lehman v2.0" hits and it will hit, the next step function in the Fed's global bailout will be so big and so fast, it will induce vertigo.'

Correction. It should be Lehman(s)

The Limerick King's picture



The insolvency crises is here

The headlights will soon hit the deer

With Ben at the wheel

Here comes the Big Steal

Bend-over and lube-up your rear.

ratso's picture

Simply put - this is not a rerun of Bear Sterns or Lehman.  It is, however, a European liquity crisis.

end da fed's picture

would someone mind explaining this to me? (and yes, i could use The Bears right about now)

TruthInSunshine's picture
Welcome To Bailout 2.0!

"...they want all of the benefits of a Capitalist society but want the Socialist economic format of the state providing everything for the society...

With the countries having VATs there are problems. Each nation has different rates.

The United Kingdom has a 50% Income Tax and a VAT of 17.5 % Total taxation per citizen: 67.5% Tax rate. Sweden: Income Tax 55%; VAT 25% Total: 80%. Norway: Income Tax: 54.3% Total: 79.3%. Denmark: Income Tax 58%; VAT 25% Total: 83%

Even with these outrageous tax structures these countries are NOT financing social programs solely from taxes. They’re in debt beyond their eyeballs and need bail-out money no other country can really afford to provide. Except Ben Bernanke; he’ll print money until it has NO value and then print some more. Some say Bernanke needs an exorcism. He’s channeling John Maynard Keynes to no good effect.

Bernanke thinks the European socialist economic system is something America needs to assist. Good luck.

I’d suggest rather than an exorcism for channeling Keynes; he needs an enema. It might clear his head.

Nikola Tesla's picture

VAT is 20% in the UK now. It's fucking killing me whilst buying silver.

TruthInSunshine's picture

Slightly Off Topic, but Timmay just sealed the death of the with a wet, sloppy kiss, as only the Jeetner can definitively do, with his perfect .000% batting average. From The New York Times (virtuous disseminator of Goebbelfied news):

Geithner Sees 'Progress' in Efforts to Shore Up Euro

*20%? When will the Brits wake up and ride the politicians out on a rail? I have little doubt that Amerika will adopt a VAT soon, just because it's another way for the largest industry - government workers - to grasp at any means of ensuring their bloated ranks, salaries, pensions and other gilded perks, given their -247% efficiency rating, redundancy on about 1800 levels, and uselessness from the outset on about 1800 more.

Nikola Tesla's picture

I've been trying to get everyone I know to save the world by having a "hang a banker" day, hasn't exactly taken off yet...

We're too stoic and the majority are too stupid to understand the rape that's occurring. People are annoyed, but believe it'll all be better in a few years. I've woken a few people up, but it's hard work. Remember, we sold the world the shit shows like x factor, [x] has talent etc, we really do know how to pump out the propaganda machine these days.

The media over here would make Goebbels blush!


Paying 20% on top of the spot + fee really makes silver unappealing, especially when it gets hammered back time and time again. However, as a poor debt serf it's all that's within my grasp.

Hugh_Jorgan's picture

It isn't a "behind the scenes" Bear Sterns event, it is the Fed propping up the ECB and the IMF over Greece and the rest of the PIIGS.

synonym's picture

Hey NK,

you probably already know, but just in case you don't, if you hold silver in a metal holding, such as Goldmoney or BullionVault, and don't take delivery then VAT is not payable. Plus, in future if you wanted to unlock some of the cash in your metal, with Goldmoney you can do that with their "SilverGrammes" i think.

Nage42's picture

Go somewhere, buy Canadian Maple Leaf Silver coins (CND$5 legal tender) and bring it back over the boarder as a financial instrument.

They can't duty you on carrying less than ~$10K in legal tender ~= 2000 coins...



nuinut's picture

whilst VAT on gold is...?

SaMsKy's picture

A small correction, Norway is financing by revenue. But the norwegian pension fund aka oilfund will be hit bad, and i dont like it!!

LawsofPhysics's picture

WRONG, it is a solvency crisis.  Liquidity implies the problem could be fixed by simply adding more money to the money supply (a.k.a. more printing).  This will do nothing as everyone is everyone else's counterparty and everyone is demanding collateral assets of REAL VALUE in exchange, only to realize the nobody has enough assets of real value to back the amount of printing that will be required.  Fucking default already and address the REAL fucking problem (which ultimately is that the WORLD is insolvent).  Good luck.

reboot this mofo's picture

wow, nailed that bitch. You get 2 lines.

powersjq's picture

Exactly. Insolvency is the ultimate cause. But illiquidity will the proximate cause. The crash will come about when major financial institutions have insuffient funds to meet current obligations. That's illiquidity. But the reason why they will be unable to meet their obligations is because no one will lend them money, because no one knows who has the assets to cover all his obligations--and this is problem because many, many banks simply do not have sufficient capital (liquid or near-liquid assets) to repay their current debts. That's insolvency.

Hugh_Jorgan's picture

Injecting liquidity is the short term Neo-Keynesian remedy for the symptoms of the underlying insolvency problem.

It reminds me of drinking whiskey to dull the pain of the leg amputation because it is 1880 and it the only remedy in the house.

With these devils at the helm, the question is; whether the patient actually dies from alcohol poisoning or blood loss.

fonzanoon's picture

Is it me or have TPTB figured out how to deal with a Lehman type event without the market falling apart?

LawsofPhysics's picture

Yes, suppress the PM paper market, steal client funds so they can not take delivery of physical PMs that don't exist and print all along through ZIRP policies and free open double secret loans to unknown banks all around the world.

Any questions?  It really has long since past any sort of polite letter writing campaign to your politician.

end da fed's picture

"free open double secret loans to unknown banks all around the world"

speaking of which... i want to make sure i understand this... the FED is creating FRN out of thin air and loaning it to banks everywhere. they can do this without anyone knowing, correct?

even if FOIA comes into play years down the road, the FED has the ability to hide this?

LawsofPhysics's picture

Unless the other parties come forward and tell the world, then yes.  Funny how in a world were the IRS can tell precisely how much money your were paid last year, and probably every year, and where you spent every single cent of those funds, the Bernanke can not tell congress who he made loans too, what the interest was, or what the precise amount was and duration/repayment schedule.  Lots of youtube video of Ben saying "I don't know" to these types of specific questions during congressional hearings.  Nice to see another mind awaken.  Sorry, too late to take the blue pill.

end da fed's picture

thanks! I awoke awhile back but still find myself astonished at times, like when i think im understanding something TD has posted, and i say to myself "no fucking way this is happening", and then i get confirmation from you guys that i've understood it correctly

LawsofPhysics's picture

I awoke when trying to close an account with Bank of America to take the cash to a coin dealer and they told me I could only take out $1,000 cash per day.  So I went over to another desk at the bank, got a credit card on the account and went to the coin dealer anyway and spent it all.  Came back and close the empty account the day after.  the good news is that these paper-pushing fucknuts are not that bright either.

end da fed's picture

brilliant- or not... such a simple run around. what a fucking joke. i think ive seen you post before that you want to be done with this farce. i agree. the sooner the better. i want to get this shit over too. unfortunately, i think alot more printing will happen first.

Dental Floss Tycoon's picture

"So I went over to another desk at the bank, got a credit card on the account and went to the coin dealer anyway and spent it all."

The only difference is that now they have a paper trail.  They know what you bought and where you bought it.

gojam's picture


Funny how the most sensible comment here gets stated.

Though LawofPhysics has a good point too, it's definately not a Bear Stearns or Lehman Brothers and I think that was your point


LawsofPhysics's picture


My point is that the effectiveness of printing without structural reform is becoming short lived and cost more and more.

ratso will get his liquidity crisis once all parties admit that they are insolvent and default.  In particular, I would predict a shortage of small denomination coins and bills.

gojam's picture

Hi LoF

I did credit you and I can't fault your views but insolvency is a lack of liquidity. European countries and banks have plenty of illiquid assets that nobody wants to buy.

But I think ratso was also right concerning this continual comparative historical analysis.


Spastica Rex's picture

"Asset that nobody wants"

Isn't that an oxymoron?

LawsofPhysics's picture

I disagree, if you are solvent you have the hard assets that can be sold to make you liquid again.  If you are right and I am wrong, then let's see the countries in trouble sell their assets and let's see how "liquid" they become.  It isn't an "asset" if nobody wants it.  You sound like a graduate student I know in eCONomics.

Don't look back to predict the future for if you really use honest historical analysis to predict where this is heading then you are predicting WWIII, I guess I'd like to be a bit more optimistic.

tarsubil's picture

Why not just create paper "assests" and sell them to each other? Problem solved!

LawsofPhysics's picture

Been doing that for 40+ years, the half-life for this "solution" is decreasing exponentially, unfortunately most do not understand exponential equations.

tarsubil's picture

Just create the assests exponetially faster!

But Captain, she canna take much more of this!

gojam's picture

Hi LofP,

It's my own fault for dashing down something quick before a meeting without really thinking.

I think ultimately you are right but I also think that the problems vary across Europe. Some banks are illiquid some are insolvent. Of the two it'll likely be insolvency which will trigger the big crisis which will expose liquidity issues. So you're right on that.

I'm against historical analysis as a predictor for future events which is why I think ratso was right to say this is not Bear Stearns or Lehman.

That was my main point too and I don't see why everyone jumped down his throat for saying it.

jonan's picture

light travels over 6 trillion miles per year, nothing can travel faster than it, other than the speed at which satanke can print, perhaps C in the keynesian world is the constant for coke?

DavidC's picture

Well, unless the guys at the large hadron collider are right about neutrinos...


tarsubil's picture

Theories are made to be broken.

jonan's picture

who would have known that bankers, not physicists, would discover how to warp space and time...next up, bernanke announces the grand unification of the four forces, catches the first ever graviton, and opens a portal the M dimensions, all done in his spare time while saving the world, must be nice doing gods work...

OpenEyes's picture

So, a bartender says "I'm sorry but we don't serve faster-than-light neutrinos here"


a neutrino walks into the bar

jonan's picture

was his name timmah or bernanke?

ArkansasAngie's picture

Hold on there Benny Boy.  You don't have my permission to hit the infinity button.


IAmNotMark's picture

Snarling reply:  "Permission?  We don't need no stinking permission!!!"

ACP5gTG's picture

I believe that would be "steenking", sir . . . 

FEDbuster's picture

Just think if they had to print all that cash?  Electronic fiat money is so damn convenient, no need for wheelbarrows this time around. 

Get your food, pm coins and battle gear, the coming crash will be Medieval.

Fips_OnTheSpot's picture

Yep, "outstanding", indeed =)

gojam's picture

"we have just experienced a behind the scenes Bear-type event"

Any speculation as to what that was ?

GeneMarchbanks's picture

Take your pick: Shock Gen, Credit Agri, any of the Spanish banks, Intesa etc etc