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Gordon McAlpin
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Does IMF Stand for Impressive Macroeconomic Flexibility?
So the IMF is holding a meeting on rethinking macroeconomic policy (I was invited but couldn’t make the timing work.) And the Fund’s chief economist has already made it clear that he’s open to some serious revision of the prevailing paradigm.
http://hat4uk.wordpress.com/2012/03/13/exclusive-why-these-first-greek-bailout-monies-are-a-myth/
EXCLUSIVE: WHY THESE FIRST GREEK BAILOUT ‘MONIES’ ARE A MYTH
“Watch my right hand very, very closely..”
130 billion euro EFSF sits unused as Draghi manufactures the 66 billion in ‘non-cash bonds’ earmarked for Athens.
Regler banks on the markets to supply the rest.As I retired to bed last night (funny how everything official in the EU happens while we’re all asleep) I had my doubts. Why would even the headcases in Brussels hand over the rest of the money to a crooked cadaver? And further, it would be real money this time – not paper leveraged in a bazooka-firewall, or some other blended metaphor….would they really release it? Had the planned default group given up?
Well, as always with the eurozone, the Devil is in the detail. Or rather, in this case, the con is in the soundbites. As a result of last night, precisely 5.9 billion has been released ‘from the EFSF’ to cover March. That can be added to the 35.9bn ‘approved’ last Friday – delivered in order to avoid sure default on March 20th: so, sorry Felix old top – you were wrong. That means the Greeks now have 40 billion; but they will be told, not asked, how to use it. And it isn’t real money. It isn’t even budgeted EFSF money.
The ‘money’ has been creaed by the ECB. No, you’re not seeing things: the plan is to go to the markets for the rest. The EU’s FinMin have yet to spend a brass farthing of the real money: they hope that the 130 bn of real EFSF money may not be needed.
Klaus Regler, the world’s most incompetent fundraiser, announced triumphantly last night that 66bn euros in EFSF bonds had already been obtained. Funny that, I thought: when did that get raised? The answer is, it didn’t. Again in the small print, ‘Last week, the fund issued 66 billion euros in bonds and bills without tapping the markets, comprised of [sic] 35 billion euros in European Central Bank collateral enhancements, and 31 billion euros in accrued interest and debt swap sweeteners.’ Aah, right: they borrowed it from themselves. That’s handy. The ECB describes the sum as ‘bonds issued on a non-cash basis’. Doncha love it? I didn’t know money could get any more unreal, but apparently it can.
What the Athens Government has right now is not even enough to start the bank recapitalisation there. Last night, Evangelo Venizelos smiled and said he was expecting to receive the 25 billion euros for that “soon”. Given that the Venizelos calendar works on a 1:50 quotient, that could mean anything: “within hours” during late January, for example, meant “three weeks from now”. But that won’t be real money, it will be Draghi-created accountancy money. Another 3.3 and 5.5 bn in April and May respectively will then follow. Allegedly.
I don’t think the Athens Government will ever get it.
Add up the numbers. 66 billion euros have been created by printing and swapping oddly un-cashlike bonds that no member State’s sovereign budget has yet been raided to get.
35.9 bn went out last Friday. 5.9 bn went out yesterday. 25 bn will follow ‘soon’. That is almost exactly 66 billion euros.
All that funny money may have gone before the month is out. At this point, Regler the House Idiot says, “We will go frequently to the market. And next week alone we may go three times to issue short-term bills, to issue five-year bonds and possibly also issue 25- or 30-year bonds. Given these amounts, the EFSF will be in the market from now on a very regular basis.”
The bloke’s tonto. Either that, or the folks who might buy them are tonto. Me, I think the soubriquet fits Klaus Regler rather more snugly.
Suppose the EFSF’s valiant entry into the markets goes phuurt next week – what then? Well, the end of that week is Friday March 23rd.
The bottom line is this: the ‘money’ being given to Greece has not changed the size of the EFSF by one cent. It is still 130 bn euros, and it is still sitting there, set aside (probably) for Italy’s use. The ‘bailout’ monies are artificially leveraged, created and printed funny-money. If Greece defaults Friday week, it can be written off with the minimum of pain.
Mario Draghi and his Troika chums have pulled off the most amazing illusion here. Christine Lagarde’s IMF, you may also note, has yet to cough up anything in this ‘bailout’.
But now, the cat’s out of the bag. Will the markets notice? Let’s wait and see."
BBC market data:
Previous close value
*All charts show local time
Dow Jones 15 min delayvaluechange%12959.71+37.69+0.29Top winner and loser Exxon Mobil Corp. 85.55+1.25+1.48JP Morgan Chase & Co. 40.54-0.49-1.19Nasdaq 15 min delayvaluechange%2983.66-4.68-0.16Top winner and loser Tudou Holdings Limited 39.48+24.09+156.53Anthera Pharmaceuticals Inc. 3.56-2.86-44.55S&P 500 15 min delayvaluechange%1371.09+0.22+0.02Top winner and loser Equifax Inc. 44.09+1.46+3.42MEMC Electronic Materials 3.68-0.19-4.91
Market reportsvaluechange%6120.61+4.92+0.08
London
FTSE 100 15 min delayvaluechange%5933.84+41.09+0.70Top winner and loser Vedanta Resources 1429.00p+60.00+4.38Antofagasta 1231.00p-39.00-3.07Dax 15 min delayvaluechange%6961.98+60.63+0.88Top winner and loser Commerzbank AG 1.86+0.07+3.68Bayerische Motoren Werke AG St 70.20-0.85-1.20The banks are buying it so far.
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aoscottnyt
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Critics' Picks Video: 'Akira'
“Critics' Picks Video: 'Akira' - http://nyti.ms/eqpZbU TETSUO!!!!!”Magic implies "superpowers".Magic is fiction.Magic does not exist.
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Roger Ebert
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Does IMF Stand for Impressive Macroeconomic Flexibility?
So the IMF is holding a meeting on rethinking macroeconomic policy (I was invited but couldn’t make the timing work.) And the Fund’s chief economist has already made it clear that he’s open to some serious revision of the prevailing paradigm.
Everyone is guessing. Some guess better than others.We can depend on powerful people to gather wealth.Power has no relationship to ethics.Not strictly true.Both power and ethics relate to jail time.
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neilhimself
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Church Mailer, Artist and Ally, Dies
“Norris Church Mailer's obituary - http://nyti.ms/daYMd5. We dined together twice, 19 years apart. She was the sweetest lady, funny & nice.”A loss for civilization.
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ropeofsilicon
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Anatomy of a Scene: 'The Fighter'
“Anatomy of a Scene: 'The Fighter' - http://nyti.ms/gUcNe7”Sooner is better. As soon as you can is best.
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Kino International
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The Ballad of Blu-ray and Scratchy Old Film
“The Ballad of Blu-ray and Scratchy Old Film - http://nyti.ms/6nLYI0”Dave Kehr is not any kind of technologist. The DVD player and the DVD itself have very little relationship to the digital file they hold.Do not blame the hardware for problems in the software.The relationship problems of the digital to Jellyware are all with the Jellyware.Kehr is troubled by the film industry and the sales departments of the film industry.These are business problems, not technical problems.
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kino_intl
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A Road Trip to the End of the Road
Richard Ray Whitman and Casey Camp-Horinek as a couple on a final journey in “Barking Water.”Sooner is better. - - As soon as you can is best.
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facetschicago
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Do the 10 Top the 5? Oscar Promoters Say Yes
“Do the 10 Top the 5? Oscar Promoters Say Yes - http://nyti.ms/dlPWXf”
Ten may not be a big enough number.The goal is the best work in a number of categories.each work requires about two hours of attention.120,000 hours of contributed effort.Sixty man years every year in just one category.It is a small pool to choose from.
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