Don’t Tell Germany Draghi Is About To Monetize 90% Of Bund Issuance

Don’t Tell Germany Draghi Is About To Monetize 90% Of Bund Issuance (ZeroHedge, Dec 22, 2014):

The Bank of Japan’s expansion of record stimulus today may see it buy every new bond the government issues.

The BOJ said it plans to buy 8 trillion to 12 trillion yen ($108 billion) of Japanese government bonds per month under stepped-up stimulus it announced today. That gives Governor Haruhiko Kuroda leeway to soak up the 10 trillion yen in new bonds that the Ministry of Finance sells in the market each month.

Translated: the BOJ will monetize 100% of all Japanese debt issuance (source).

… And this:

in Q1, we expect the ECB to announce a EUR500bn sovereign QE program and buy EMU government bonds according to each EMU country’s ECB capital key contribution. This implies that the ECB would purchase EUR130bn of German bonds, i.e., 90% of the 2015 gross issuance of German Bunds.

Translated: the ECB will monetize 90% of all German debt issuance (source).

Or just show them this chart.

JGB and Bunds

And since Japan no longer cares what the lunatics in charge do as its fate is sealed anyway, please make sure any Germans observing the above are unable to see the chart below, which shows what happened the last time a central bank monetized all of their Bund issuance.

Germany - Euro area Inflation History

The Germans are going to need a bigger chart.

3 thoughts on “Don’t Tell Germany Draghi Is About To Monetize 90% Of Bund Issuance

  1. Didn’t they see what happened to the US?
    The US is finished, not only as a world power, but as an economic leader or builder.
    You cannot fund yourself with your own money……if others are not interested, you have a problem……Dallas, we have a problem…..

  2. Oops, meant “Houston, we have a problem.”
    Doesn’t anyone understand what this is……….a cheap way to go into debt and go into it twice……..it is the most insane behavior I have ever seen.
    The fall of the US ought to teach them all, but Japan is already falling………
    If the ECB does this with German bonds…………………the fall of the EU and the dollar is set into place.

  3. The more I think about this, the more disturbed I get.
    Germany is already deeply in debt. They had this illusion when they first joined the Euro that the nations spoke the truth about their debt level, so figured they would gain power by loaning them money………….become the leader of the largest economic system in the western world…………..such is the thing dreams are made of……..until they realized all these nations had used Enron accounting (exported by Moody’s), and their true debt level was far higher. By this time, Germany had their debt, but nothing to insure they would ever see their money again. They stopped loaning them money, told the ECB to step in, and now they are in bed with the ECB in order to borrow their own money, and use it…….regardless it is now all debt, regardless of what they earn.

    What does a profitable business make on their investments per year? Average is 30-35%, and that is only if they are really healthy. Governments, regardless of how they try, are not businesses, and cannot be run as one. As a result, they are lucky to break even or earn from exports……

    Exports…..the EU WAS earning E120 billion GDP from Russia until they instated those fool sanctions from the US. Putin pulled the plug, and now they entire EU is down E120 billion, an amount of money they will need to borrow in order to operate. All their exports have been denied by Russia, China can build their cars, Brazil can provide the food, India the technology, and so on.
    Putin has built a world economy that does not rely on the US or the EU…..and the reality of this is becoming apparent. So much for exports.

    So Germany is going to make the same mistake the US just did, only they are not as big, and have not been operating nearly as long. Soon, all that money will be burned up, then what?

    This simply accelerates the time the EU dumps the dollar and joins BRICS. They will have little choice. BRICS offers them good trade agreements, profits…….all the things they wanted when they started out. BRICS also offers loans to smaller nations who need funds and don’t want US domination. It is but a matter of weeks before the first EU nation goes with BRICS. Whoever set up the EU did not require all nations agree on everything.

    I cannot believe the Germans are being as foolish as the US.

    As for Japan, they are finished in any case. They are being cooked from the inside out. Fukushima is killing them, and all of us on the west coast of the US.

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