Germany

Yesterday CDS speculators, today financial shorts, tomorrow the world. German regulator BaFin has learned absolutely nothing from America's 2008 brush with the short sale ban, and has announced that it is tightening disclosure rules on short-selling as related to ten financial company shares, saying it "wanted to ensure the stability of the financial system" is preserved. Ah, the old "if-the-world-is-threatened-by-vicious-speculators-you-must-acquit-of-irresponsible-fiscal-policies-and-mismanagement" defense. Additionally, BaFin, which is still trying to figure out just who it was that got cremated on the most ridiculous short squeeze ever (i.e., Volkswagen) said that the move was made necessary "by the need for the regulator to be informed quickly to take "targeted action" should such activity pose risks."

It has been at least 15 minutes without a rumor, report, or actual development on Greece. So here is one: Market News reports that a senior member of Chancellor Palpatine, er, Angela Merkel's CDU/CSU-FDP government coalition has told the news agency that "Greece cannot count on financial help from the European Union and has to solve its budget problems on its own."

SocGen's Dylan Grice provides a gripping account of Germany's hyperinflationary episode, in which he charts the extended parallels between not just the precursor economy that lead to a 16,579,999% inflation in 1923 Weimar Germany, and modern day developed (and highly leveraged) countries, but between Germany's then central banker Rudolf von Havenstein, and the Greenspan-Bernanke duo. And while we know how "der Geld Marschall's" Weimar experiment ended, the future before the U.S., as a result of the Maestro's (both Senior and Junior) almost identical policy response is still open-ended. As the future of America is now exclusively in the hands of insidious economists, the following insight from Grice into the utility of economic models and decision-making should be sufficient to dash the hopes of any optimist for a favorable outcome.

Have we just crossed the historic Rubicon when a photoshopped classical statue is about to lead to a collapse in a monetary and customs union, and possibly something a tad more serious? Also, is the KFW bailout rumor too little too late? It appears the Greeks are two minutes away from saying "take you bailout and shove it." The reason: The Focus cover which shows a status of Venus de Milo flipping off the Greeks, who were characterized as the "cheats of the eurozone." After recent Greek media outbursts have recalled the Nazi wartime occupation of the country, as well as demands for WWII reparations, today's action by the Federation of Greek Consumers, calling for a boycott of products, made by "banana-eating" Germans, is a direct response to the airbrushed statue of Venus expressing the communal German sentiment. Oh, and that whole KfW rumor? Don't buy it: "[KfW bond purchasing] considerations have been presented because it's seen as the only way of avoiding accusations of...direct aid," the lawmaker said. But he stressed that no decisions have yet been taken. I.e., More posturing.

Germany is considering buying Greek bonds through state-owned lender KfW Group, German lawmakers said today. KfW is preparing measures that are part of a European plan to grant Greece as much as 25 billion euros ($34 billion) in aid should the need arise, said four lawmakers, who spoke on the condition of anonymity because the information is confidential....Assistance to Greece should flow through the International Monetary Fund, the most suitable body to offer financial help that’s tied to stringent conditions, the lawmaker said. The IMF should provide more than technical assistance, the lawmaker said, citing aid given to Hungary and Baltic states as examples.

More as we get it.

Crazy pill time. More disinformation as we get it. Is Germany merely probing to see the market reaction to leaks? If the Bund collapses can they just call the whole thing off?

Total, utter, complete confusion. The latest from Reuters, quoting a German Government official, is that the Greece bailout rumors are UNFOUNDED.

Now that there is no more risk, anywhere, here are the preliminary thoughts on how kicking the can down the road has just taken on a whole new meaning, courtesy of the FT Deutschland. We are certain that citizens of Germany and France will be ecstatic to see their tax money used to first save Greece, then Spain, the Portugal, then Italy, then Lithuania, then Bulgaria, etc.

Yet another rumor denied vehemently by the Greek Finance Ministry, which automatically means it is 100% true, is that Greece rescue talks are reaching a fever pitch, and according to FT-Deutschland, Germany is seeing increasing pressure to bail out the struggling country. As Dow Jones reports "rescue talks are being held in the EU and with certain capitals about aid for Greece, according to the sources, the report adds. Several options are being discussed, one of which being bilateral loans from some euro zone countries, where Germany would have to shoulder a major part as the euro zone's largest economy."

In a sign of just how eager all foreigners are to piggy back on the US' premeditated destruction of the dollar, Germany has just issued $4 billion in three-year dollar denominated bonds.

As the U.S. is preparing to issue trillions in Treasuries, with the latest twist being to add to the U.S.