reply to post by surrealist
Again, market internals are absolutely horrible with 50 stocks hitting new highs and 600 at new lows.
Shorts are probably covering in anticipation of further lows.
2011 Global Stock Market Collapse Watch, page 46
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reply posted on 15-9-2011 @ 12:15 AM by galdur
The market is going totally bananas. A 500-point drop one of these days seems very likely, IMO.
Meanwhile, this sounds sort of ominous:
Shadow Banking Contagion Approaches As European Banks Sign Private Repo Agreements With US Counterparts
In what is probably the riskiest escalation of the second credit crisis to date, IFR has released information that was until now speculated, but not confirmed, namely that European banks not only continue to make a mockery out of LiEbor by posting whatever rates they deem appropriate (for the simple reason they don't use interbank funding), while in the meantime going directly to US banks, using shadow, and hence completely unregulated conduits, in the form of private repo arrangements with "at least three of the five biggest US banks."
www.zerohedge.com... m_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+survival+rate+for+everyone+drops+to+zero%29
Meanwhile, this sounds sort of ominous:
Shadow Banking Contagion Approaches As European Banks Sign Private Repo Agreements With US Counterparts
In what is probably the riskiest escalation of the second credit crisis to date, IFR has released information that was until now speculated, but not confirmed, namely that European banks not only continue to make a mockery out of LiEbor by posting whatever rates they deem appropriate (for the simple reason they don't use interbank funding), while in the meantime going directly to US banks, using shadow, and hence completely unregulated conduits, in the form of private repo arrangements with "at least three of the five biggest US banks."
www.zerohedge.com... m_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+survival+rate+for+everyone+drops+to+zero%29
reply posted on 15-9-2011 @ 12:21 AM by galdur
This is what Zerohedge is quoting, from
www.ifre.com...
US banks have become the unlikely saviours of their ailing European counterparts, signing private agreements to lend them billions of dollars in recent weeks after an exodus of nervous money market funds left many without ready access to short-term funding.
Agreements worth tens of billions of dollars have been signed in the last month alone, according to bankers directly involved, who added that senior management of firms on both sides of the transactions have been closely involved with hammering out deals.
French lenders are among those using such facilities, say bankers, although deals have also been struck with UK and other European firms. Loans have been made as repo agreements, with banks posting assets such as corporate loans and mortgage portfolios as collateral.
“We were able to use some of our assets to get long-term repos,” said one board member at a French bank. “It was a move we made to monetise some of the assets we had on the balance sheet which were good, quality assets, and also to mitigate the withdrawal of money market funds.”.
Paris-based Societe Generale said that it had struck US dollar repo deals equivalent to €6bn against a portfolio of commercial mortgage-backed securities and collateralised loans with maturities longer than six months. US bankers say other banks have struck similar deals in recent weeks to generate cash.
One source at BNP Paribas with knowledge of the situation said the bank was using US dollar repo markets for fixed income activity, but “not more than usual”, though the bank acknowledged that its use of short-term US money market funds dropped by €10bn to €36bn since the end of July.
“Doing repo means you don’t have to sell and don’t have to take the loss on many of these assets upfront,” said another banker at a US bank, who has signed off on such deals in recent weeks. “You can do it privately, so nobody needs to know, and spread losses over the lifetime of the assets.”.
The fact that US banks are willing to increase their exposure to European firms – even if they insist on significant haircuts and conservative interest rates – demonstrates that they are happy dealing with such counterparties, at least for the moment.
www.ifre.com...
US banks have become the unlikely saviours of their ailing European counterparts, signing private agreements to lend them billions of dollars in recent weeks after an exodus of nervous money market funds left many without ready access to short-term funding.
Agreements worth tens of billions of dollars have been signed in the last month alone, according to bankers directly involved, who added that senior management of firms on both sides of the transactions have been closely involved with hammering out deals.
French lenders are among those using such facilities, say bankers, although deals have also been struck with UK and other European firms. Loans have been made as repo agreements, with banks posting assets such as corporate loans and mortgage portfolios as collateral.
“We were able to use some of our assets to get long-term repos,” said one board member at a French bank. “It was a move we made to monetise some of the assets we had on the balance sheet which were good, quality assets, and also to mitigate the withdrawal of money market funds.”.
Paris-based Societe Generale said that it had struck US dollar repo deals equivalent to €6bn against a portfolio of commercial mortgage-backed securities and collateralised loans with maturities longer than six months. US bankers say other banks have struck similar deals in recent weeks to generate cash.
One source at BNP Paribas with knowledge of the situation said the bank was using US dollar repo markets for fixed income activity, but “not more than usual”, though the bank acknowledged that its use of short-term US money market funds dropped by €10bn to €36bn since the end of July.
“Doing repo means you don’t have to sell and don’t have to take the loss on many of these assets upfront,” said another banker at a US bank, who has signed off on such deals in recent weeks. “You can do it privately, so nobody needs to know, and spread losses over the lifetime of the assets.”.
The fact that US banks are willing to increase their exposure to European firms – even if they insist on significant haircuts and conservative interest rates – demonstrates that they are happy dealing with such counterparties, at least for the moment.
reply posted on 15-9-2011 @ 10:10 PM by galdur
reply to post by SeekerofTruth101
Nice picture, but I don´t think so.
I think it´ll be maximum upside for business and maximum downside for taxpayers as usual.
Timmy Geithner is busy bailing out Europe, mainly because US banks are loaded with crap from over there.
And vice versa, I´m sure.
Starting to hear folks mixing metaphors, like
they´ll kick the can so far down the road that it´ll run into the house of cards.
Nice picture, but I don´t think so.
I think it´ll be maximum upside for business and maximum downside for taxpayers as usual.
Timmy Geithner is busy bailing out Europe, mainly because US banks are loaded with crap from over there.
And vice versa, I´m sure.
Starting to hear folks mixing metaphors, like
they´ll kick the can so far down the road that it´ll run into the house of cards.
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