Mar 05

ECB

Europe to start €1.14trn ‘easy money’ program on March 9 – ECB President (RT, March 5, 2015):

The European Central Bank will kick off its monthly €60 billion purchases of government bonds and private sector assets next Monday, said the head of the ECB Mario Draghi.

“Following up on our decisions of 22 January 2015, we will, on 9 March 2015, start purchasing euro-denominated public sector securities in the secondary market. We will also continue purchasing asset-backed securities and covered bonds, which we started last year,” Draghi said in a press-release published Thursday after a news conference in Cyprus.

The programme will last till September 2016, Draghi confirmed. The €1.14 trillion package is hoped to avert deflation and save the eurozone from a triple-dip recession. Continue reading »

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Feb 22

Petras-Book-image

The Assassination of Greece (Veterans News Now, Feb 21, 2015):

by Dr. James Petras

The Greek government is currently locked in a life and death struggle with the elite which dominate the banks and political decision-making centers of the European Union.What are at stake are the livelihoods of 11 million Greek workers, employees and small business people and the viability of the European Union.  If the ruling Syriza government capitulates to the demands of the EU bankers and agrees to continue the austerity programs, Greece will be condemned to decades of regression, destitution and colonial rule.  If Greece decides to resist, and is forced to exit the EU, it will need to repudiate its 270 billion Euro foreign debts, sending the international financial markets crashing and causing the EU to collapse. Continue reading »

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Feb 21

Schäuble-Varoufakis

How Greece Folded To Germany: The Complete Breakdown (ZeroHedge, Feb 20, 2015):

Having, as we previously explained, been given ‘just enough rope’ by the Germans, we thought it worth looking at just what Greece capitulated on (or perhaps a shorter version – what they did not capitulate on) and how Tsipras and Varoufakis will sell this to their fellow politicians… and most of all people.

As OpenEurope explains,

What points has Greece capitulated on?

1. Completion of the current review – Greece has basically agreed to conclude the current bailout. Any funding is conditional on such a process: 

Only approval of the conclusion of the review of the extended arrangement by the institutions in turn will allow for any disbursement of the outstanding tranche of the current EFSF programme and the transfer of the 2014 SMP profits. Both are again subject to approval by the Eurogroup.

This is a clear capitulation for Greek Prime Minister Alexis Tsipras, who said the previous bailout was “dead” and the EU/IMF/ECB Troika is “over”.  Continue reading »

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Feb 20

Related info:

Shots Fired: Schauble Says “Greeks Certainly Will Have A Difficult Time To Explain The Deal To Their Voters” (ZeroHedge, Feb 20, 2015):

Did anyone honestly not think the German finance minister would not have the final word?

GERMAN FINMIN SCHAEUBLE SAYS AS LONG AS THE PROGRAMME FOR GREECE ISN’T SUCCESSFULLY CONCLUDED THERE WILL BE NO PAYOUT
GERMAN FINMIN SCHAEUBLE SAYS ‘THE GREEKS CERTAINLY WILL HAVE A DIFFICULT TIME TO EXPLAIN THE DEAL TO THEIR VOTERS’

He’s right.

The 330 Billion Reasons Why The Grexit “Can” Was Kicked Down The Road (ZeroHedge, Feb 20, 2015):

Perhaps this explained why Greece and The Eurogroup have (reportedly) come to an agreement to avoid an actual Grexit for 4 months. As Die Welt explains that Euro-area nations will face losses of up to EUR330bn as Greek outright government debt, ECB capital needs, and TARGET2 liabilities have soared in the last 2 years since the crisis last erupted…


–  Full Eurogroup Statement On Greece – Redline Comparison With Previously Rejected Statement (ZeroHedge, Feb 20, 2015):

Just out from the Eurogroup, the final statement. Bottom line: Greece caves on pretty much everything, however it has two semantics successes: the dreaded “Troika” words has been replaced with “institutions” and “current programme” has been changed to “current arrangement” – surely nobody will notice. Sarcasm aside, Greece has just kicked the can for four months. Why four months? Because that’s just ahead of the big Greek debt maturity.

Eurogroup statement on Greece

The Eurogroup reiterates its appreciation for the remarkable adjustment efforts undertaken by Greece and the Greek people over the last years. During the last few weeks, we have, together with the institutions, engaged in an intensive and constructive dialogue with the new Greek authorities and reached common ground today.

The Eurogroup notes, in the framework of the existing arrangement, the request from the Greek authorities for an extension of the Master Financial Assistance Facility Agreement (MFFA), which is underpinned by a set of commitments. The purpose of the extension is the successful completion of the review on the basis of the conditions in the current arrangement, making best use of the given flexibility which will be considered jointly with the Greek authorities and the institutions. This extension would also bridge the time for discussions on a possible follow-up arrangement between the Eurogroup, the institutions and Greece. Continue reading »

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Feb 20

grexit-3


From Germany’s Spiegel:

Google translation (Original article in German down below):

Im Licht der blauen Stunde
ECB headquarters in Frankfurt am Main: Simulation games for the Grexit

Debt dispute: ECB prepares for Greek euro exit (Spiegel, Feb 20, 2015):

Still negotiating Athens and the Euro-partners about new grants. Behind the scenes alternatives are already being played: The ECB is preparing by SPIEGEL information on the Greek exit from the euro before.

Frankfurt – The European Central Bank (ECB) is preparing for a Greek exit from the monetary union. To that effect, Employees by information obtained by SPIEGEL, an internal simulation games by how the rest of the euro zone could be held together.

Despite all the denials to urge the European monetary authorities the Greeks to finally introduce capital controls. According to the findings of the ECB, the Greeks have a day more than one billion euros abroad. Continue reading »

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Feb 20

Greek Deposit Run Accelerates Ahead Of Monday’s Bank Holiday (ZeroHedge, Feb 19, 2015):

Official Greek deposit data began tumbling in December (outflows around EUR3bn), and accelerated in January in the run up to the Syriza election (proxied by JPMorgan at over EUR 12bn). During the last two weeks, however, the absence of ATM lines and visible bank runs has been curiously lacking as, at least on the surface, there appears to be no panic. However, as Dody Tsiantar reports, sources in the Greek banking sector have told Greek newspapers that as much as EUR 25bn euros have left Greek banks since the end of December with outflows surging this week. Perhaps they are getting anxious that authorities will take Cypriot advantage of the Bank Holiday that is planned in Greece on Monday.

Greek Bank Holiday

As Dody Tsintar reports (via CNBC), Continue reading »

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Feb 19

draghi prayer

ECB Releases Minutes From Its Historic January 22 “QE Launch” Policy Meeting (ZeroHedge, Feb 19, 2015):

Today, for the first time, the ECB released minutes from its historic January 21-22 meeting during which the ECB unleashed QE. While hardly containing anything earthshattering, here are the main highlights. First, from Bloomberg:

  • ECB MEETING ACCOUNT SHOWS POLICY MAKERS SPLIT ON QE
  • LARGE NUMBER’ OF COUNCIL MEMBERS IN FAVOR OF BUYING GOVT DEBT
  • ECB POLICY MAKERS SAW NO OPTION FOR POLICY OF `BENIGN NEGLECT’
  • ECB CONSENSUS WAS SOVEREIGN DEBT BUYING ONLY SUFFICIENT OPTION
  • ECB ACCOUNT SHOWS OFFICIALS CONSIDERED BUYING CORPORATE DEBT
  • ECB DECIDED TO RAISE BOND BUYING TO EU60B FROM EU50B PROPOSED
  • ECB POLICY MAKERS SAW DETERIORATION IN PRICE-STABILITY OUTLOOK
  • QE OPPONENTS SAID NO URGENT NEED FOR ACTION SEEN NOW
  • QE OPPONENTS SAID BUYING SOVEREIGN DEBT SHOULD BE LAST RESORT

And the key excerpt from the section discussing monetary policy: Continue reading »

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Feb 18

Nigel Farage On “The Great Game Of Poker Over The Future of The Euro” (ZeroHedge, Feb 17, 2015):

“There is a great game of poker taking place for the future of this currency,” Nigel Farage exclaims as he  deservedly takes a small victory lap over his warnings of the anti-democratic nature of the dis-union that has been created. As his warnings that “the EU will crush, and kill, and destroy nation state democracy,” have gone unheeded, this last week has seen The Eurogroup’s behavior justify everything Farage has feared… Juncker: “there can be no democratic choice against the Euro.”

Farage at his best…

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Feb 18

Draghi Satan

“In The End Capital Controls Will Probably Have To Be Imposed” – Eurogroup Official (ZeroHedge, Feb 17, 2015):

With less than 24 hours until the ECB’s meeting at which Mario Draghi and company are set to decide if i) they will increase the current Greek emergency liquidity allotment from €65 billion as a result of the ongoing bank deposit run or ii) reduce – or even outright cancel it – to send Tsipras a message that the time for negotiations is over, Europe is no longer playing Mr. nice guy. In fact, judging by the latest report in Reuters, which may well be nothing but another planted trial balloon (in the aftermath of today’s latest Telegraph revelations one should read everything presented in the media, here certainly included, with a cape-size ship full of salt) Greece can kiss goodbye not only any a loan extension without a bailout “programme” resumption, but also any hope that tomorrow’s its ELA will be increased.  Continue reading »

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Feb 17

From the article:

“In short: anyone betting that tomorrow the ECB will extend the Greek last-ditch source of liquidity no questions asked, may want to not hold their breath. And once Greek ELA access is withdrawn, well… Cyprus was called a “blueprint” for a reason.”


Mario-Draghi-laughing

As Bank Run Accelerates, Greek Depositors Pray To Saint Mario (ZeroHedge, Feb 17, 2015):

As we have consistently shown over the past month, the battle between Greece and the Eurozone is all about leverage, and specifically who has more of it. Furthermore, as we laid it out previously, the best way to quantify this duel of leverage is through two easily observable metrics: the level of Eurozone risk asset prices (if Greek contagion fears were dominant, the Eurostoxx would be tumbling), and the pace of deposit outflows from Greek banks (if the Greeks fear the ECB is about to yank all money they would pull their cash from the bank, in the process forcing Tsipras and Varoufakis to the negotiating table willing to sign anything Europe throws at them).

Which is why in a Eurozone in which all price levels are now controlled by the ECB, it is not surprising that no amount of huffing and puffing has managed to derail the Stoxx or the Dax even briefly from their relentless surge to all-time highs. Continue reading »

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Feb 16

David Stockman: The Global Economy Has Entered The Crack-Up Phase (PeakProsperity, Feb 15, 2015):

Few people understand the global economy and its (mis)management better than David Stockman — former director of the OMB under President Reagan, former US Representative, best-selling author of The Great Deformation, and veteran financier.

David is now loudly warning that events have entered the crack-up phase, which he predicts will be defined by the following 4 developments: Continue reading »

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Feb 13

Stealth Greek Bank Run Continues: ECB Hikes Emergency Lending To EUR 65 Billion (ZeroHedge, Feb 12, 2015):

It would appear the un-sourced rumors of Greek banks having used up their Emergency line of credit with the ECB are true. Following a hastily put together conference calls this morning:

  • *ECB RAISES GREECE ELA ALLOWANCE TO EU65BN: FAZ

Up from the previous EUR59.5 Billion. It appears the stealth bank run in Greece is showing no signs of slowing.

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Feb 10

Yanis Varoufakis Sums Up Europe In One Sentence

–  Varoufakis Blasts ECB “Has Lost Control Of Monetary Policy” As Germany Tells Greece: “There Is No Way Out” (ZeroHedge, Feb 9, 2015):

“There is no way out” for Greece from its treaty obligations warns German lawmaker Michael Fuchs (Angela Merkel’s deputy caucus chairman) telling Bloomberg TV that conditions set for Greece by The Troika (EU, ECB, IMF) for bailout funds “have to be fulfilled…. That’s it, very simple.” The Greeks remain adamant that they will not ask for an extension to the bailout mechanism with both Tsipras and Varoufakis confirming that a bridge agreement is required and the latter adding “the ECB has lost control of monetary policy,” demanding the Troika structure come to an end. Then German Finance Minister Wolfgang Schaeuble exclaimed at the G-20 meeting that “Greece either has to find a way to get bridge financing, or, if they want to do it with us, they need a program,” seeming to push the door open to possible Russian financial aid for Greece as Europe’s pivot to Putin appears to be rising. Continue reading »

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Feb 09

Flashback:

Here Is What Happens After Greece Defaults (ZeroHedge, May 21, 2011):

What happens when Greece defaults. Here are a few things:

  • Every bank in Greece will instantly go insolvent.
  • The Greek government will nationalise every bank in Greece.
  • The Greek government will forbid withdrawals from Greek banks.

Greek Euro Exit: 60% Currency Devaluation, Default, Banking Sector Collapse (Forbes, Sep. 06, 2011)

How can the Greek people protect themselves?

Belarus Devalues Its Currency By 56% Overnight, Against Every Currency Out There (ZeroHedge, May 23, 2011):

Luckily for those who held their “money” in the form of gold and silver, they just got an instantaneous 56% value preservation and a relative boost in their purchasing power with just one central bank announcement.


grexit-3

If Greece Exits, Here Is What Happens (Redux) (ZeroHedge, Feb 8, 2015):

Now that the possibility of a Greek exit from the euro is back to being topic #1 of discussion, just as it was back in the summer of 2012 and the fall of 2011, and investors are propagandized by groundless speculation posited by journalists who have never used excel in their lives and are merely paid mouthpieces of bigger bank interests, it is time to rewind to a step by step analysis of precisely what will happen in the moments before Greece announces the EMU exit, how the transition from pre- to post- occurs, and the aftermath of what said transition would entail, courtesy of one of the smarter minds out there at the time (before his transition to a more status quo supportive tone), Citi’s Willem Buiter, who pontificated precisely on this topic previously. Three words: “not unequivocally good.” Continue reading »

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Feb 06

GReeCe 2015...

Greece: The Big Picture Update, And Why Deutsche Bank Thinks Europe Will Fold (ZeroHedge, Feb 5, 2015):

The Greek situation summaries Greece by Deutsche Bank’s George Saravelos have consistently been among the best in the entire sellside. His latest Greek update, which is a must read for anyone who hasn’t been following the fluid developments out of southeast Europe, which fluctuate not on an hourly but on a minute basis, does not disappoint.

But while his summary of events is great, what is of far greater significance is his conclusion, namely that ultimately Europe will fold: “we consider the most likely outcome to be a Eurogroup offer of a new Third program” and “given that the current program expires this February the offer to negotiate a new Third program may provide political room for the government to sit on the negotiating table. At the same time such an offer is very likely to be attached to strict conditions, with the willingness to accommodate t-bill issuance an open question. Developments overnight suggest that this has become less likely, imposing maximum pressure on the government to reach agreement within a matter of weeks.” Continue reading »

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Feb 04

Mario-Draghi-laughing

ECB Pulls The Trigger: Blocks Funding To Greece Via Debt Collateral – Full Statement (ZeroHedge, Feb 4, 2015):

Just what the market had hoped would not happen…

  • *ECB SAYS IT LIFTS WAIVER ON GREEK GOVERNMENT DEBT AS COLLATERAL
  • *ECB SAYS IT CAN’T ASSUME SUCCESSFUL CONCLUSION OF GREECE REVIEW

What this means simply is that since Greek banks are now unable to pledge Greek bonds as collateral and fund themselves, and liquidity is about to evaporate, the ECB has effectively just given a green light for Greek bank runs, as suddenly it has removed, both mathematically but worse politically, a key support pillar from underneath the already bailed out Greek banking system, (or merely a negotiating move to let Greece see just what kind of chaos this will create ahead of the big D-Day on Feb 25th when ELA could be withdrawn). Continue reading »

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Feb 04

Mario-Draghi-laughing

– First Germany, Now ECB Rejects “Latest Greek Bailout Plan” (ZeroHedge, Feb 3, 2015):

So much for the Greek “conciliatory proposal” story in which Greece was said to “drop” its debt writedown request, driven by yesterday’s FT article, and the catalyst for Monday’s late day market surge.

As reported earlier today, first it was Germany’s turn when it “threw up all over Varoufakis proposal, calling Greek plan “Half-Baked.” And now, somewhat poetically, is the FT’s turn to yank the other stool from underneath those who saw yesterday’s development as even remotely meaningful as opposed to merely attempts by Greece’s restructuring advisor Lazard to thrown anything at the wall and see what sticks, following a report that “the European Central Bank is resisting a key element of the Greek government’s new rescue plan, potentially leaving Athens with no source of outside funding when its international bailout expires at the end of the month.”

Continue reading »

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Jan 31

varr8

Caught On Tape: Dijsselbloem To Varoufakis: “You Just Killed Troika” (ZeroHedge, Jan 31, 2015):

Amid ‘turmoiling’ stock markets on Friday, CNBC’s Simon Hobbs summed up the status quo’s thinking on the new Greek leadership when he noted, somewhat angrily and shocked, “The Greeks are not even trying to reassure the markets,” seeming to have entirely forgotten (and who can blame him in this new normal the world has been force-fed for 6 years) that political leaders are elected for the good of the people (by the people) not for the markets. Yesterday saw the clearest example yet of Europe’s anger that the Greeks may choose their own path as opposed to following the EU’s non-sovereign leadership’s demands when the most uncomfortable moment ever caught on tape – the moment when Eurogroup chief Jeroen Dijsselbloem (he of the “template” foot in mouth disease) stood up at the end of the EU-Greece press conference, awkwardly shook hands with Greece’s new finance minister, and whispered…”you have just killed the Troika,” to which Varoufakis responded… “wow!”

As Keep Talking Greece reports,

Continue reading »

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Jan 31

You can’t make this stuff up!


mortgage

In Denmark You Are Now Paid To Take Out A Mortgage (ZeroHedge, Jan 30, 2015):

With NIRP raging in the Eurozone and over €1.5 trillion in European government bonds trading with negative yields, many were wondering when any of this perverted bond generosity will spill over to other debtors, not just Europe’s insolvent governments (who can only print negative interest debt because of the ECB’s backstop that it will buy any piece of garbage for sale in the doomed monetary union). In fact just earlier today we, rhetorically, asked a logical – in as much as nothing is logical in the new normal – question:

Little did we know that just minutes after our tweet, we would learn that at least one place is already paying homeowners to take out a mortgage. That’s right – the negative rate mortgage is now a reality.

Thanks of Mario Draghi’s generosity with “other generations’ slavery”, and following 3 consecutive rate cuts by the Danish Central Bank, a local bank – Nordea Credit – is now offering a mortgage with a negative interest rate! This means, according to DR.dk, that Nordea have had to pay instead of charging interest to to a handful of customers, says housing economist at Nordea Kredit, Lise Nytoft Bergmann for Finance. Continue reading »

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Jan 30

Mario-Draghi-Just-Evil

AXA Investment Managaer Explains Why The ECB’s QE Has Already Failed Using “Widget Makers” (Zerohedge, Jan 29, 2015):

“People say, ‘Sell government bonds and lend money to widget manufacturers.’ It doesn’t really work like that.” Hayes says, adding that “Low yields don’t necessarily mean more lending to the real economy; time and confidence are key elements and last 6 years have shown QE can’t control those.” In short: it hasn’t even started and QE is already a complete failure. Good job central-planners.

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