While overnight markets are rocking based on continued speculation coming from some completely uncorroborated and unconfirmed source that Europe has just boldly gone where even Goldman's Abacus has not dared to go before courtesy of the ECB's acceptance of a CDO squared "Enron Special" SPV, Germany has once again made it very clear that not only will there not be any expansion in the EFSF in regular terms, but certainly not in structural ones. As Goldman's Dirk Schumacher makes it very clear, any attempts at imposing on Germany a fait accompli reality that has no bearing in actual reality (especially one that excludes the only relevant decision-maker in Europe) will be met with increasing protests from the entire German ruling class. According to Die Welt, the Free Democratic Party is threatening to vote against overhaul of EFSF if discussions about leveraging fund don’t stop. Goldman elaborates: "FDP and CSU not fond of further increase of EFSF. Leading figures from the FDP and the CSU, the Bavarian branch of the CDU, rejected any thoughts of a further increase of the EFSF (either directly or indirectly through leverage). FDP general secretary Lindner said that "the chancellor should make clear immediately that there is no change to the business model of the EFSF." So, yes, consider that an official denial of the Liesman rumor which as typical, has no confirmation anywhere else.
In other news, Germany did report some good news, but hardly the slam dunk Eurocrats were hoping for with the report of its GfK consumer confidence, which came in unchanged at 5.2%, on expectations it would drop to 5.0%. Again from Goldman:
Stable consumer confidence. GfK consumer confidence remained stable in October recording an unchanged level of 5.2. Among the subcomponents 'business cycle expectations' continued their downward trend (+4.8 after 13.4), while 'income expectations' rebounded strongly (35.1 after 27.6). The 'willingness to buy' index declined (29.7 after 36.9), but still remains high on a historical basis (see chart). While it seems that a growing number of households expect a deterioration of the economic outlook, most think that this will not necessarily affect their individual situation.