Friday, October 28, 2011

Was A Wrecking Ball Just Taken To The EU Taxpayer Bailout Agreement?

Looks like the German high court has issued an injunction on the German Parlaiment's ability to deploy taxpayer money to fund the new EFSF funding agreement.  Sourced from zerohedge quoting Spiegel Online: 
Germany's Federal Constitutional Court on Friday expressed doubts about the legality of a new panel of lawmakers set up by the German parliament to reach quick decisions on the release of funds from the euro bailout mechanism, the European Financial Stability Facility (EFSF). The court issued a temporary injunction banning the nine-person committee in the Bundestag from taking any decisions on the deployment by EFSF of German taxpayer money.
Here's the direct LINK

As I commented yesterday, the "rescue agreement" has a lot of holes in it that can ultimately only be funded realistically by printing money and expropriating the Taxpayer wealth from countries that still have middle class wealth to steal and give to the banks under the guise of "saving" Greece.  It's good to see a supreme court that is still independent enough from the tentacles of banking wealth that will take a closer look at everything.  That would never happen in the United States these days...

But wait, there's more:  The Italian banks are looking a gift horse in the mouth and are lifting their leg on any new capital raising requirements.  This is absurd.  Italy, on the cusp of financial collapse, gets an offer of a free lunch from German taxpayers (and U.S. per the terms of the rescue deal via the IMF), and all they have to do is pay the tip.  Here's the article from the Financial Times LINK

This is crazier than last night's World Series game.  I wouldn't short this market, but I wouldn't bet that yesterday's EU deal gets implemented the way it was drawn up...but I would get ready for A LOT more money printing by buying as much gold as possible below $2,000/oz and as much silver as possible below $40.

This was the German public's response to the EU rescue agreement:


  1. Worth a listen..

    John Doody on Gold Stocks—Undervalued and UnderlovedDoody also discusses Argentina’s new tax legislation

  2. Eric Janszen: We Are Witnessing The Death of the Dollar

    What do you get when the producer of the world's reserve currency takes on too much debt? Nothing less than the end of the US Treasury-based monetary system.

  3. not only am i a broncos fan, but i'm a cardinals fan too, for over 30 years's been an exciting 28 hours!

  4. Some ride...

    all-or-nothing macroeconomic or systemic issues dominate the buy-sell decision on a daily basis.

    Ned Davis Research has been among the numerous longtime market
    watchers marveling at the unity with which stocks are either rising or
    (rare as it's been this past month) falling. Since 1972, the median
    correlation of an Standard & Poor's 500 member stock to the S&P index
    itself over the prior three months has been 0.46, meaning 46% of
    individual stocks moved the same way as the index. It hit 0.86 a week
    ago Friday in a rising tape, a level exceeding the day of the 1987
    crash and one usually associated with panicky crash-like days.

    This all-or-nothing character can also be seen in the frequency of
    days in which at least 90% of all stocks in the broad S&P 1500 move in
    one direction. Wayne Kaufman, market analyst at John Thomas Financial,
    says this happened 14 times in 2006. The next four years' tallies were
    23, 39, 44 and, last year, 47. So far this year there have been 58
    such days, including 33 of the past 62.

    Explanations range from the prevalence of hyperspeed cyber traders to
    the ascendance of exchange-traded index funds as preferred vehicles
    for the fast money.
    But this sort of monochromatic action also tends to accompany markets
    in which all-or-nothing macroeconomic or systemic issues dominate the
    buy-sell decision on a daily basis.

  5. Treaty of Debt - An Eye Opening Video on the ESM Bailout Mechanism

    There are no independent reviewers and no existing laws apply. Thus Europe's national budgets will be in the hands of one single, unelected body that is accountable to no one and immune from all legal actions.

    Is this the future of the EU or will the German supreme court and other governments put an end to it?

  6. Well..if you had any doubts where we're going...

    Larry Summers: Debt Got Us Into This Mess and Debt Will Get Us Out
    Debt Is Good?

    "The central irony of financial crisis is that while it is caused by too much confidence, too much borrowing and lending and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending," Summers writes in a recent op-ed in The Financial Times.

    Exclusive buttonwood gathering video..

  7. Fergusson discusses how the hyperinflation affected different groups in German society in different ways – with debtors benefitting and huge numbers of middle-class savers wiped out.
    The lbo kings will be rewarded...high junk issuers will reign even more supreme...

    James Turk in conversation with Adam Fergusson

    Riots, corruption and political extremism were just some of the malignancies encouraged by the hyperinflation. He points out that those who held hard currencies as well as people who held tangible assets like gold and silver were in-large part protected from the worst economic consequences of the hyperinflation. In his words: “gold remained at all times in Germany the measure of what was important to them.”

  8. Then we are joined by former constitutional and civil rights litigator and contributing writer to Salon, Glenn Greenwald, the author of “With Liberty and Justice for Some; How the Law is Used to Destroy and Protect the Powerful”. We discuss the two-tiered system of justice in this country that protects the powerful and punishes the powerless, and how the uprising by the 99% is the first step in reversing a complete takeover of America by oligarchs.

  9. Clear and Present Danger

    This might have been worth the risk if foreign borrowing had been invested for roads, high speed railroads, new
    industries, cheap energy, airports, and to fund scientific research. The debt would self-liquidate. Instead, some
    of the debt has been used for transfer payments to fuel current consumption or for items like farm subsidies.
    It’s as if you mortgaged your house to buy groceries. Eventually you’ll have no house and no food either.
    Moreover, a very large chunk of the debt has been monetized through Federal Reserve Bank purchases and used
    to fill gaping holes in bank balance sheets. Unrepentant banks resist reform and dilute attempts at regulation
    while soaking up ongoing subsidies. All of this is dead-end financing at the expense of citizens that saved their
    money and pay taxes.