Market Optimistic On Central Bank Intervention

via: ZeroHedge
by: Tyler Durden
August 7, 2012

Market Optimistic On Central Bank Intervention

Today’s AM fix was USD 1,613.00, EUR 1,300.39, and GBP 1,032.39 per ounce.
Yesterday’s AM fix was USD 1,606.75, EUR 1,299.43 and GBP 1,032.28 per ounce.

Silver is trading at $28.08/oz, €22.71/oz and £18.01/oz. Platinum is trading at $1,415.70/oz, palladium at $582.50/oz and rhodium at $1,100/oz.

Ireland observed a national holiday on Monday.

Gold climbed $8.40 or 0.52% in New York yesterday and closed at $1,611.20/oz. Silver hit a high of $27.985 and closed with a gain of 0.5%.

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In Order To Be Saved, Spain And Italy Must First Be Destroyed

via: ZeroHedge
by: Tyler Durden
August 4, 2012

There has been much confusion over last week’s remarks by Mario Draghi, with the prevailing narrative being that the market first got what Draghi meant wrong (when it plunged), then right (when it soared). The confusion is further granulated by attempts to explain what was merely a desperate attempt at delaying a decision for action, which was inevitable considering the now open opposition by Buba’s Weidmann, into a formal and planned plotline: “Inverse Twist” or other such technical jargon is what we have seen floating around. The reality is that, just like all other central bankers, Draghi did what he does best: use big words and threats of action in hope it will buy him a few extra days of time. The reality is also that, just like when the LTRO was announced, the market did get it right initially, when peripheral bonds plunged, and got it wrong over the subsequent 3 monthswhen bond prices rose, only to collapse to new lows (and in the case of Spain – record high yields as of two weeks ago). Back then, the ECB merely bought a few months time with itstransitory intervention. This time it has at best bought a few days with the lack of any actual action. And yet, Draghi didleave a way out, for at least another brief respite (where unless Europe expands the available bailout machinery yet again, the respite will have an even briefer half life than that from the LTROs). The way out is simple, and in order to avoid any confusion, we will use an allegory from the movie Batman: Spain and Italy can be saved. But first they must be destroyed.

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Bankers Being Arrested All Over The World

via: EliotNess
July 29, 2012

Ireland Allows Iconic Potato to be Genetically Modified

via: NaturalSociety
by: Anthony Gucciardi
July 30, 2012

In a monumental move that signifies the truly terminal state of the international food supply, Ireland’s government officials have given the green light to begin genetically modifying the iconic potato. Met with severe resistance from both citizens, watchdog organizations, and political figures, the decision allows for the genetically modified potatoes to be planted within Ireland by the Irish food development authority Teagasc.

Starting off with a trial within the nation’s borders, Ireland’s Environmental Protection Agency (EPA) has authorized Teagasc to plant the GMO crops throughout a two hectare land plot. While supports continue to assert that the relatively small size makes the process ‘safe,’ experts from within the Emerald Isle say otherwise. In response to the idea that starting the trial with a ‘small’ land plot is safe, The Organic Trust in Dublin explains that once you unleash genetically modified seeds into the environment, the consequences that may follow do not depend on how many acres of land is modified — only the fact that genetically modified seeds have been planted.

Continue Reading At: NaturalSociety.com

For Italy, It Is Game Theory Over

via: ZeroHedge
By: Tyler Durden
July 27, 2012

We discussed the use of Game Theory as a useful tool for analyzing Europe’s predicament in February and noted that it was far from optimal for any (peripheral or core) sovereign to pre-emptively ‘agree’ to austerity or Eurobonds respectively (even though that would make both better off). This Prisoner’s Dilemma left the ugly Nash-Equilibrium game swinging from a catastrophic break-up to a long, painful (and volatile) continuation of the crisis. Recent work by BofAML’s FX team takes this a step further and in assigning incentives and from a ‘do-not-cooperate’ Nash-equilibrium between Greece and Germany (no Greek austerity and no Eurobonds) they extend the single-period game across the entire group of European nations – with an ugly outcome. Analyzing the costs and benefits of a voluntary exit from the euro-area for the core and periphery countries, the admittedly over-simplified results are worrying. Italy and Ireland (not Greece) are expected to exit first (with Italy having a decent chance of an orderly exit) and while Germany is the most likely to achieve an orderly exit, it has the lowest incentive to exit the euro-zone – since growth, borrowing costs, and a weakening balance sheet would cause more pain. Ultimately, they play the game out and find while Germany could ‘bribe’ Italy to stay, they will not accept and Italy will optimally exit first - suggesting a very dark future ahead for the Eurozone and with EUR tail-risk so cheap, it seems an optimal trade – as only a weaker EUR can save the Euro.

The cost of insuring against EUR tail risk, which was already in retreat even before the EU Summit, has fallen further since, is at 2 year lows.

Continue Reading At: ZeroHedge.com

Spain Discussed €300 Billion Full Bailout, Germany “Uncomfortable”

via: ZeroHedge
by: Tyler Durden
July 27, 2012

While the EUR was soaring, and Spanish bond yield were (very briefly) plunging in the past 48 hours, the reality behind the scenes was very different than what was blasted publicly in the headlines. Namely, Spain was on the verge of requesting a full blown sovereign bailout, one which would see it become the next country after Greece, Ireland and Portugal to fall under the Troika’s control. From Reuters: “Spain has for the first time conceded it might need a full EU/IMF bailout worth 300 billion euros ($366 billion) if its borrowing costs remain unsustainably high, a euro zone official said. Economy Minister Luis de Guindos brought up the issue with German counterpart Wolfgang Schaeuble in a meeting in Berlin last Tuesday as Spain’s borrowing costs soared past 7.6 percent, the source said. If needed, the money would come on top of the 100 billion euros already agreed to prop up Spain’s banking sector, stretching the euro zone’s resources to breaking point, and Schaeuble told de Guindos he was unwilling to consider a rescue before the currency bloc’s ESM bailout fund comes on line later this year.” So why the sudden attempt to talk up European risk in the last two days? Simple - Germany did not agree to fund Spain’s bailout. Which meant it was suddenly up to Europe’s apparatchiks to jawbone markets into cooperation. “De Guindos was talking about 300 billion euros for a full program, but Germany was not comfortable with the idea of a bailout now,” the official told Reuters.”

What this means is that, as we suggested yesterday, Draghi really has nothing up his sleeve, and the promises of the last two days from Nowotny and less than Super Mario are very ad hoc and even more hollow, and that the vigilantes are about to come back with a vengeance as Spain has effectively admitted it is broke. So once the euphoria from the latest risk on episode fades, watch out.

Continue Reading At: ZeroHedge.com

Goldman Murders Muppets, Tells Them To Stay Long Spanish, Italian Bonds

via: ZeroHedge
by: Tyler Durden
July 23, 2012

Curious just how we were 100% certain that the June 29 summit was an epic disaster, in addition to the obvious? Because in a note from that morning we said the following: “Below is Goldman’s quick take on the E-Tarp MOU (completely detail-free, but who needs details when one has money-growing trees) announced late last night. In summary: “We recommend being long an equally-weighted basket of benchmark 5-year Spanish, Irish and Italian government bonds, currently yielding 5.9% on average, for a target of 4.5% and tight stop loss on a close at 6.5%.” By now we hope it is clear that when Goldman’s clients are buying a security, it means its prop desk is selling the same security to clients.” Sure enough, its prop desk was selling, and selling, and selling. Since then Spain and Italy have blown out, and only the strange tightening in Ireland has prevented yet another stop loss from the squid which is now known for cremating clients more than anything else. The stop loss is certainly not far: the basket is now at 6.20%, and has just 30 bps to go until yet another batch of Goldman clients is slaughtered. Which is now only a matter of time – Goldman just told its clients it has a little more of its 5 Year exposure left to sell, and then it will be done. Of course by then another muppet murder scene will have to be cordoned off.

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‘Black Friday’ Blame-Game Escalates As Spain Is Out Of Money In 40 Days

via: ZeroHedge
by: Tyler Durden
July 21, 2012

With Valencia bust, Spanish bonds at all-time record spreads to bunds, and yields at euro-era record highs, Spain’s access to public markets for more debt is as good as closed. What is most concerning however, as FAZ reports, is that “the money will last [only] until September”, and “Spain has no ‘Plan B”. Yesterday’s market meltdown – especially at the front-end of the Spanish curve – is now being dubbed ‘Black Friday’ and the desperation is clear among the Spanish elite. Jose Manuel Garcia-Margallo (JMGM) attacked the ECB for their inaction in the SMP (bond-buying program) as they do “nothing to stop the fire of the [Spanish] government debt” and when asked how he saw the future of the European Union, he replied that it could “not go on much longer.” The riots protest rallies continue to gather pace as Black Friday saw the gravely concerned union-leaders (facing worrying austerity) calling for a second general strike (yeah – that will help) as they warn of a ‘hot autumn’. It appears Spain has skipped ‘worse’ and gone from bad to worst as they work “to ensure that financial liabilities do not poison the national debt” – a little late we hesitate to point out.

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Transition Towns: Agenda 21 Comes to Life

via: ActivistPost
by: Susanne Posel
June 25, 2012

Transition towns are a movement modeled after the UN’s Agenda 21 to create communities that adhere to initiatives that center around reducing CO2 emissions.

Under the alarmist perspective of man-made climate change, founders Rob Hopkins and Naresh Giangrande created the Transition Model based on studies conducted by Ben Brangwyn on global relocalization agendas.

At an initial Transition Bristol meeting in the UK, the Tudor Trust began funding this initiative. This led to the creation of the Transition Initiatives Primer, an explanatory guide to the scheme and fake grassroots groups who coerced communities into adopting the plan.

Transition Initiatives were created in Australia, Canada, England, Germany, Ireland, Italy, the Netherlands, New Zealand, Scotland, South Africa, Spain, Sweden, USA, and Wales. Training courses have been developed to ensure that this ideal becomes a global movement.

Issues under Transition Initiatives governance are food production, manipulation techniques in dealing with local governments, sustainable housing, reduction of public energy consumption, adaptation of communities to resemble transition cities and control over local economies.

Continue Reading At: ActivistPost.com

Moody’s Downgrades Spanish Banking Sector By 1-4 Notches

via: ZeroHedge
by: Tyler Durden
June 25, 2012

The long anticipated downgrade of the recently bailed out Spanish banking sector has arrived. Moody’s just brought the hammer down on 28 Spanish banks. Also apparently in Spain banks are now more stable than the country: “The ratings of both Banco Santander and Santander Consumer Finance are one notch higher than the sovereign’s rating, due to the high degree of geographical diversification of their balance sheet and income sources, and a manageable level of direct exposure to Spanish sovereign debt relative to their Tier 1 capital, including under stress scenarios. All the rest of the affected banks’ standalone ratings are now at or below Spain’s Baa3 rating.” Can Spain borrow from Santander then? They don’t need the ECB.

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