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What To Expect Out Of Europe

Tyler Durden's picture


From Peter Tchir of TF Market Advisors

I expect we will see a "grand plan" soon.  It will have a massive headline number.  It will have all sorts of bells and whistles. It will have caveats.

The headline program will sound huge.  The fact that most of it is self-referencing, writing insurance on yourself, etc., won't even be important.  It will be the conditions that are attached.  It won't be carte blanche, recipients will have to meet set criteria to receive help.  It will be phased in. It won't be all available at the first stage.

This is because Germany finally realizes, that if it commits the money carte blanche and takes leveraged exposure, it is no longer in charge.  The recipients are in charge.  Germany gets in.  France is still somewhat clueless, but Germany finally gets that the Grand Plan is the Grand Disaster for Germany.

Anything with stages of implementation and contingencies will fail to appease the market.  French ratings won't survive long enough to see full implementation, and it is unlikely the weak countries will meet any reasonable contingencies (though the TROIKA will be hiring like mad).

Maybe someone in Germany finally picked up a medical textbook and saw that a key element of battling "contagion" is QUARANTINE!   The Grand Plan ensures the spread of contagion.  If you want to stop contagion you QUARANTINE it, you don't give it mouth to mouth resuscitation.  (I still like my gangrene analogy better).

Go back to letting Greece default.  Let CDS trigger. Deal with the fallout.  It may not be as bad as people fear, in fact, in may provide a stable base that can let Europe really address the problems.




All this was predicted by Zero Hedge back on July 21: 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


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Tue, 10/18/2011 - 09:16 | 1784730 YesWeKahn
YesWeKahn's picture

France has no clue. But they are a part of the problem!

Tue, 10/18/2011 - 09:19 | 1784738 TuesdayBen
TuesdayBen's picture

Dominique, is that you?

Tue, 10/18/2011 - 09:27 | 1784763 gojam
gojam's picture

Peter, I think you should check this out by Dr Pippa Malmgren

I think Germany will announce it's leaving the Euro on Sunday.

Makes perfect sense and it joins all the dots nicely.

Tue, 10/18/2011 - 16:03 | 1786493 Ghordius
Ghordius's picture

Ze Germans not ready yet
Wait for November

Tue, 10/18/2011 - 09:17 | 1784735 Fips_OnTheSpot
Fips_OnTheSpot's picture

Go back to letting Greece default.  Let CDS trigger. Deal with the fallout.


Yes - please. I am sick&tired of the DRAMA

Tue, 10/18/2011 - 16:00 | 1786472 Ghordius
Ghordius's picture

Though I'm starting to enjoy the cabaret performance

Tue, 10/18/2011 - 09:19 | 1784740 Johnny Lawrence
Johnny Lawrence's picture

 Futures are now up.  Goldman up $2 pre-market, even though their numbers were terrible. Bonds giving back earlier gains.

No idea.

Tue, 10/18/2011 - 09:32 | 1784778 Belarus
Belarus's picture

Yeah, and even the Euro is losing ground against the USD: which is the sole reason for the 10+% rise in the market. Everyone's sales are disappointing on the top-line......China,ooops, Europe showing signs of weakening before any fiscal prudence, etc......

And the market: UP. It takes a sledgehammer to bring it down the slightest bit of dung-pile to make it soar. The market wants any fucking reason at all to skyrocket. But that's the way I figured it: until the "grand plan" is actually unveiled, the market won't blow'll just its downward trajectory from there, until Ben and Geithner realizes its print time.

Tue, 10/18/2011 - 09:37 | 1784788 MFL8240
MFL8240's picture

Prestty amazing country isnt this?  The games never seem to cease!

Tue, 10/18/2011 - 09:19 | 1784741 qussl3
qussl3's picture

Presuming the German pollies aren't bought and paid for that is.

Tue, 10/18/2011 - 09:19 | 1784742 BrocilyBeef
BrocilyBeef's picture

A tumor is not cured with a band-aid.

One size fits all currency doesn't work.

Either more integration or much, much less.

The Euro? That's so 2000s!

Tue, 10/18/2011 - 09:27 | 1784768 ATM
ATM's picture

excepting of course for gold

Tue, 10/18/2011 - 09:21 | 1784746 cossack55
cossack55's picture

Germany is attacking Russia again?

Tue, 10/18/2011 - 09:22 | 1784750 SheepDog-One
SheepDog-One's picture

This article says nothing at all except 'We're pretty sure more carrots and sticks out of bankrupt Europe'...same BS for months now wake me when something actually happens.

Tue, 10/18/2011 - 09:23 | 1784751 Ruffcut
Ruffcut's picture

What to expect? More bullshit to come. Fits like a glove or a rubber crox shoe.

Tue, 10/18/2011 - 10:23 | 1784959 theMAXILOPEZpsycho
theMAXILOPEZpsycho's picture

yep, I'm already bending over the kitchen table expecting more brussels sausage up my ass...

oh and I'm expecting to be financialy screwed by the eurocrates as well...

Tue, 10/18/2011 - 10:41 | 1785056 Tramp Stamper
Tramp Stamper's picture

Crox now oversold. Buy here at 16.50 and ride back up and sell around 20

Tue, 10/18/2011 - 09:24 | 1784754 buzzsaw99
buzzsaw99's picture

I will take back every bad thing I have ever said about germany if they will just stop listening to the usa maggots (for a change) and do the right thing.

Tue, 10/18/2011 - 09:24 | 1784756 eigenvalue
eigenvalue's picture

I don't think stages of implementation and contingencies will be a problem. Greece failed to meet the budget critieria but it's still gonna have the next tranche in November.

Tue, 10/18/2011 - 09:25 | 1784760 kaiten
kaiten's picture

Germany will endure a bit of a hardship, when the ownership of Europe is a price.

Tue, 10/18/2011 - 09:25 | 1784762 Rainman
Rainman's picture

If bullshit were a currency, the insolvent EU would be flush with cash

Tue, 10/18/2011 - 09:58 | 1784844 kaiten
kaiten's picture

Yes, and US supremacy would be ensured to infinity and beyond.

Tue, 10/18/2011 - 09:26 | 1784764 Shizzmoney
Shizzmoney's picture

Go back to letting Greece default.  Let CDS trigger. Deal with the fallout.


We have to fall before we build this thing back up.  And that's why we are still in arecession-almost-depression, b/c we still havent fallen to our low yet from the 2008 debacle.

Tue, 10/18/2011 - 09:31 | 1784776 ATM
ATM's picture

I don't think so. The previous bubble led to the next bubble - the sovereign debt bubble. That is the bubble we are now dealing with andwhen it finally bursts it will destroy money and then we got a real clusterfuck.

Tue, 10/18/2011 - 09:28 | 1784772 Platinum_Investor
Platinum_Investor's picture

New World Order grand plans.  Cripling debts for everyone so they can control everyone.

I hope Germany stands up and lets Greece fail.

Tue, 10/18/2011 - 09:29 | 1784773 Quintus
Quintus's picture

We may be coming to point beyond which the can may no longer be kicked.  Big decisions have to be made this week by the Eurogroup.

Trouble is, that making big decisions is not what they do.  Due to the almost complete lack of a democratic mandate for their 'Grand Projets' the modus operandi of the Euro leaders has always been to sneak their unpopular policies and schemes past the electorate slowly and in long, drawn-out stages.  Their entire executive process is built around this approach.

Unfortunately, when a big, irreversable (and again, unpopular and undemocratic) action needs to be taken urgently, we see the inherent flaw in the Euro leadership's arsenal.

They simply have no institutional capacity to agree and execute major policy decisions quickly and publicly.  Since the start of the Euro crisis they have adopted the usual incremental "Decision behind closed doors at private Merkozy meetings" and "Piecemeal solutions that are quite different from the headline announcements" approach.  

It hasn't worked, but they don't know any other way.

There will be no big all-encompassing agreement this weekend.  Just some big headlines and small, piecemeal actions agreed behind closed doors.


Tue, 10/18/2011 - 10:08 | 1784895 Smiddywesson
Smiddywesson's picture

Euro leaders has always been to sneak their unpopular policies and schemes past the electorate slowly and in long, drawn-out stages.  Their entire executive process is built around this approach.

Unfortunately, when a big, irreversable (and again, unpopular and undemocratic) action needs to be taken urgently, we see the inherent flaw in the Euro leadership's arsenal.

Wise words Quinus, but I can't agree with part of the premise: 

If the innaction in Europe is due to the flaw in the EU model which leaves the ECB without the power to take action, then why are other entities with such power also not taking action?  The Fed and the Treasury have done nothing to fix the system.  They are merely kicking the can and slowly acquiring gold.  If the EU were more centralized and the ECB had more power, sure it could kick the can more efficiently, but it's a mistake to believe they would use that power to fix anything at all.

The sytem can't be fixed.  There's too much debt and interlinked derivatives.  Other than kicking the can, the only long term action being taken by all central banks, all over the world, is purchasing gold.  They are even telegraphing what they are doing because they are lying about it.  The whole argument about what the ECB should do is just a smokescreen.  Even if they  could do those things, they wouldn't.   

Debt and derivatives are a giant tuna net that is slowly being drawn closed, and the only way out for the little fishies is to mirror the actions of the people in the know.  Buy gold.

Tue, 10/18/2011 - 16:12 | 1786549 Ghordius
Ghordius's picture

The Dawning of
the Age of Default

Quintus, the EuroZone was not designed to function like the UK/BoE!

Because we NEVER WANTED to!

Tue, 10/18/2011 - 18:15 | 1787120 Quintus
Quintus's picture

I don't know who 'We' is, since no European has ever been granted a direct vote on what they want the EU leadership to do (Have you? I haven't.), but it seems to me that the EZ 'Leadership' doesn't function at all in the current scenario because the system was designed primarily to hoodwink the European populace into 'Ever closer union' and not to deal with the inevitable crises resulting from this socialist/communist command-and-control approach.

Well, the crisis is here but there is no mechanism for dealing with it.  After all, why should there be when 'Political Will' would ensure that no crisis could ever happen.

In other news, 'Political Will' has repealed the law of gravity.  From now on it will be 6.66 m/s2 because 9.8 m/s2 is a legacy of primitive 'Nationalistic' nation statehood.

Tue, 10/18/2011 - 09:34 | 1784785 Money 4 Nothing
Money 4 Nothing's picture
"What To Expect Out Of Europe"


Nothing... as you were, you will hear the siren go off when there is notable news.



Tue, 10/18/2011 - 10:00 | 1784858 machineh
machineh's picture

Stand aside until you hear the toilet gurgle after it's flushed. 

Then buy freely.

Tue, 10/18/2011 - 10:20 | 1784938 Smiddywesson
Smiddywesson's picture

Funny analogy, but I can't agree with the proposal.

The deluge will occur so fast and so violently that this is a very risky strategy to take.  There is no way the Boyz will let retail contend with them for a seat in the lifeboat.  They will get a tip from the Fed that it's over and done with and they will bolt first.  When the end comes, mom and pop will be tucked in for the night, only to wake up and wonder what happened to their life's savings.

Expert timing is ok (like when everyone is kung-fu fighting) but I don't have that kind of timing so early positioning, at least with some part of your account, is a wise precaution. 

Tue, 10/18/2011 - 09:34 | 1784786 slewie the pi-rat
slewie the pi-rat's picture

tranche warfare, BiCheZ!

Tue, 10/18/2011 - 09:43 | 1784799 spanish inquisition
spanish inquisition's picture

Here is a headline.                "LE GRAND PLAN"

"Europe declares all losses stopped and it's business as usual, smooth sailing ahead! Victory was declared in the debt crisis with The Grand Plan. Details will follow, but all participants say it is what the market has been looking for and bound to work.  A general 3 piece outline has been released to much fanfare and excitement. It reads "1. Get underpants. 2. .... 3.Profit! Details are expected soon as the market digests this incredible piece of work."

Tue, 10/18/2011 - 10:16 | 1784930 fbrothers
fbrothers's picture

Do you think they are that smart?

Tue, 10/18/2011 - 10:21 | 1784950 Hannibal
Hannibal's picture

The American infatuation of Europe is amazingly astonishing. 

Tue, 10/18/2011 - 16:15 | 1786588 Ghordius
Ghordius's picture

We are sexy!
And alluring... And... And... Undecided...

Tue, 10/18/2011 - 18:10 | 1787103 supermaxedout
supermaxedout's picture

Time has come to let Greece fall down. In an interview in the German TV Schaeuble on Sunday said: The banks have to bite the bullet and the haircut will be much harder than previously thought. More than 60 % at minimum but probably 70%.

I'm sure Germany is prepared for such an action because they had time enough. Only problem is Deutsche Bank which is more an American Bank nowadays. They are deep in the derivate mud and Mr. Ackermann the Bilderberg man is fighting the haircut with everything he has.  The worst thing what can happen is that the Investment banking part of Deutsche Bank (located in London and New York) is going broke and the retail part (concentrated in Germany)  is saved by the German taxpayer by guaranteeing the saving accounts of the small costumers. That is much cheaper than saving Deutsche Bank. 

Deutsche Bank is an essential part of the fraud scheme of Wall Street and I hope that not one public Euro or Dollar is further spent for Deutsche Zombie Investment Bank.

Go Angela go, Give Ackermann and Wall Street hell. Let the derivate monster come down now it will come down anyhow soon. 

Angela Dragonkiller go.

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