Overnight Markets-Leading News-Update 2


Greece Bond Swap Update-Bloody England Defeated

Greece moved closer to sealing the biggest sovereign restructuring in history as investors indicated they’ll participate in the nation’s debt swap.

Holders of about 60 percent of the Greek bonds eligible for the deal, including Greece’s largest banks, most of the country’s pension funds and more than 30 European banks and insurers including BNP Paribas (BNP) SA and Commerzbank AG (CBK), have agreed to the offer so far. That brings the total to about 124 billion euros ($163 billion), based on data compiled by Bloomberg from company reports and government statements.

The euro and stocks gained on speculation Greece will reach its participation target by the deadline of 10 p.m. in Athens today. The goal of the exchange is to reduce the 206 billion euros of privately held Greek debt by 53.5 percent and turn the tide against the debt crisis that has roiled Europe for more than two years.

The swap “will go through” and markets won’t be jarred should a majority fall short of the targeted amount, Peter Bofinger, an economic adviser to the German government, said in an interview from Berlin today with Bloomberg Television.

Clauses

While Greece would prefer a voluntary deal, the government has said it will use collective action clauses to force holders of Greek-law bonds into the swap if the so-called private sector involvement falls short and it gets sufficient approval from investors to change the bonds’ terms.

“I think that the markets are aware of the risk that a majority for voluntary restructuring is not available, and so I think the surprise won’t be too big if tonight when they realize the collective action clauses will have to be applied,” Bofinger said.

Under the rules of the exchange, investors holding at least 50 percent of the eligible bonds must vote on the swap, and 66 percent of those must agree to amend the bonds to enable the government to impose the collective action clauses,Commerzbank AG (CBK)’s head of fixed-income strategy,Christoph Rieger, said in a note yesterday.

“Adding up the commitments to participate in the Greek PSI, it is now clear that the CAC hurdles will very likely be cleared,” Reiger said.

The 17-nation euro added 0.5 percent to $1.321, while the Stoxx Europe 600 Index gained 1.3 percent to 263.35 at 10:48 a.m. in London….

http://www.bloomberg.com/news/2012-03-07/investors-with-39-of-greek-debt-agree-to-join-in-swap-iif-says.html

Draghi Says Stagflation -But leaves Rates

European Central Bank President Mario Draghi said inflation will probably breach the bank’s 2 percent limit this year and signaled the worst of the sovereign debt crisis may be over even as the economy stalls.

“Inflation rates are now likely to stay above 2 percent in 2012, with upside risks prevailing,” Draghi said in Frankfurt today after the ECB kept its benchmark interest rate at a record low of 1 percent. Latest data “confirm signs of a stabilization in the euro area economy,” though the economic outlook “is still subject to downside risks,” he said.

Draghi’s comments are “certainly hawkish,” said James Nixon, an economist at Societe Generale SA in London. “Basically, the ECB is confident that the crisis has been averted and the focus is now back on inflation.”

The sovereign debt crisis is damping growth across the euro region and making banks reluctant to lend. Having flooded the banking sector with more than 1 trillion euros ($1.31 trillion) to avert a credit crunch, the ECB is now confronted with an oil- price increase that’s propping up inflation at a time when at least six of the 17 euro nations are in recession.

Draghi said the ECB’s latest economic projections show inflation averaging 2.4 percent in 2012, up from a December forecast of 2 percent. They show the economy may contract 0.1 percent, down from the previous forecast for 0.3 percent growth.

Gradual Recovery

“Looking ahead, we expect the euro-area economy to recover gradually in the course of this year,” Draghi said. However, tensions created by the debt crisis “are expected to continue to dampen the underlying growth momentum,” he said.

Growth will accelerate to 1.1 percent in 2013 and inflation will slow to 1.6 percent, according to the ECB’s projections.

“Risks to projected HICP inflation rates in the coming years are seen to be still broadly balanced, with upside risks in the near term mainly stemming from higher-than-expected oil prices and indirect tax increases,” Draghi said. “However, downside risks continue to exist owing to weaker than expected developments in economic activity.”

With widening economic divergences making it harder for the ECB to set a common monetary policy, its response may be to do nothing. It will keep rates on hold at least through the third quarter of 2013, the median forecast in a Bloomberg survey shows.

Policy makers didn’t discuss changing interest rates at their meeting today, Draghi said

http://www.bloomberg.com/news/2012-03-08/draghi-sees-europe-inflation-rate-above-2-with-economic-growth-stalling.html

Pirate hedge funds mull risky Greek debt battle

http://www.reuters.com/article/2012/03/07/hedgefunds-greece-idUSL5E8E76T920120307

Fukushima People Being Used by NWO as test Rats

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/03/07/MN8P1NH8HP.DTL

Greek bond swap prospects lifted by fresh pledges

(Reuters) – Major banks and pension funds threw their weight behind Greece’s bond swap offer to private creditors on Wednesday, making it increasingly likely that the deal will pass and clear the way for a bailout package to avert an immediate default on its debt.

A group of banks and funds representing 40.8 percent of Greece’s 206 billion euros of outstanding debt said they would take part in the deal, joining other Greek and foreign banks and pension funds which have already pledged to accept the offer.

A senior Greek finance ministry official told Reuters the government was now optimistic that well over 75 percent of eligible bonds would be submitted, easily clearing the original minimum threshold it had set for the deal to proceed.

In total, bank, insurers and pension funds holding bonds worth around 120 billion euros have already declared they will take part. Some hedge funds and several Greek pension funds were holding out against the deal.

The European Union and International Monetary Fund have made a successful bond swap a pre-condition for final approval of the 130 billion euro ($170 billion) bailout agreed last month and ministers will decide on whether to clear the package in a conference call on Friday afternoon.

Athens, totally reliant on international support to stave off a default that could set off a severe banking crisis across the euro zone, has asked its private sector creditors to accept steep losses on their Greek bond holdings..

http://www.reuters.com/article/2012/03/07/us-greece-bonds-idUSTRE82412N20120307

Asian Markets Rise on Expectation Greek Bond Swap To be Completed

http://www.reuters.com/article/2012/03/08/us-markets-global-idUSTRE8181RD20120308

Report on German’s demanding Gold back is wrong Although German Parliament is getting worried

Okay here it is reported in Bild, kind of the NY Post of Germany. The Bundesbank is very evasive and in violation of German law with respect to record keeping and some other issues. Basically there has been no audit since 2007 by the Bundesbank of the Gold at the Fed. No mention in the article of the Bundesbank or German Parliament asking for the gold back although some people in the German Parliament are going to put it to the Bundesbank.

So again if this was ZH source they are rumor mongering again.

Thanks the reader who sent me the link to this story.

I dont read Bild anymore as the front page is frankly softly pornographic at best and sleazy. FAZ is Germanys financial paper of record. ZH what an outfit. Rumor du jour. A little enclave of Lodon. A gossip and rumor mill. This is a pretty funny article. A pair of Bild Reporters show up at the NY FED and demand to see Germany’s gold and are denied, of course.

BILD beim Goldschatz der Deutschen in New York

Deutsche Goldreserve: BILD beim Gold-Schatz der Deutschen in New YorkCDU-Außenexperte Philipp Mißfelder (l.) und BILD-Reporter Ralf Schuler vor der Federal Reserve Bank in New York. In New York lagern tonnenweise deutsches Gold

New York – Es ist der wertvollste Schatz, den wir Deutschen besitzen: 3401 Tonnen pures Gold – rund 1800 Euro für jeden. Absolut krisenfest, verteilt auf Hochsicherheitstresore in Frankfurt, Paris, London und New York! Und die Bundesbank kümmert sich nicht darum!

Der unglaubliche Gold-Skandal! Am 19. November 2011 berichtete BILD, dass die Deutsche Bundesbank 2007 zum letzten Mal einen Blick auf unsere Goldbestände in New York geworfen und damit sogar den Bundesrechnungshof alarmiert hat (Prüfung dauert an).

Ein klarer Rechtsbruch, sagt Top-Bilanzrechtler Prof. Jörg Baetge zu BILD: „Mindestens alle drei Jahre müssen Kontrollzählungen der Barren vorgenommen werden.“ Das hat die Bundesbank nicht getan.

Eine Schlamperei mit handfesten Folgen: In der jährlichen Bilanz der Bundesbank machen die Goldreserven (aktueller Wert rund 147 Mrd. Euro) einen „bedeutsamen“ (Baetge) Posten von mehr als 17% aus: Sind also die Bundesbank-Bilanzen der letzten Jahre falsch?

Alarmiert von dem BILD-Bericht, wollte es der CDU-Bundestagsabgeordnete und Außenpolitik-Experte Philipp Mißfelder genauer wissen. Am Rande von Gesprächen bei der UNO in New York will Mißfelder die dort gelagerten Teile der deutschen Goldreserven bei der Federal Reserve Bank (Fed) kontrollieren.

Nach dem BILD-Bericht fordert er von Bundesbank-PräsidentJens Weidmann die Liste der Goldbarren. Mißfelder zu BILD: „Ich war schockiert. Erst hieß es, es gebe keine Liste. Dann gab es doch Listen, die geheim seien. Dann sagte man mir, Nachfragen gefährden das Vertrauen zwischen Bundebank und Fed.“

Als die Bundesbank von den BILD-Recherchen zum deutschen Staatsgold erfährt, versucht Kommunikationschef Michael Best sogar, den Besuch des Abgeordneten und die Berichterstattung in BILD zu behindern: „Vor diesem Hintergrund bitte ich um Verständnis, dass die Bundesbank Ihr Besuchsanliegen (…) nicht weiter unterstützt.“

Was will die Bundesbank verheimlichen?

BILD vor Ort. Nummer 33 Liberty Street, Downtown Manhattan. Es geht fünf Etagen in die Tiefe. „E-Level“:  Blanke Fußböden, summende Lüftung, gigantische Stahltüren. Und: 7000 Tonnen Gold! Mehr als im legendären Fort Knox. Es ist das größte Gold-Depot der Welt.

Aber wo ist das deutsche Gold?

Jack Gutt vom Stab des Fed-Vizepräsidenten: „Es ist in einigen dieser 122 Stahlgitter-Abteilungen. Mehr darf ich nicht sagen.“

Wieviel Barren? Alles geheim. Keine Fotos!

Nur soviel: Das deutsche Gold liegt in einigen der Gitter-Kammern hier im New Yorker Tresor. BILD will es sehen: Keine Chance! Gezeigt bekommt es nur die Bundesbank. Dieser Ortstermin wäre Ihr Job gewesen, Herr Bundesbank-Chef!

Wie erkennt man das deutsche Gold?

Jack Gutt zu BILD: „Es gibt Listen mit allen Barren. Jeder Barren hat eine Nummer, einen Stempel für den Reinheitsgrad des Goldes und ein Siegel.“ Die deutschen Goldbestände können also nach Recht und Gesetz gezählt werden. Im Bundestag wächst der Druck:

Mißfelder zu BILD: „Es kann nicht sein, dass beim Gold-Vermögen der Deutschen offenbar gegen geltendes Bilanzrecht verstoßen wird. Das ist ein Fall für das Parlament. Ich fordere eine klare Bestandsaufnahme.“

http://www.bild.de/geld/wirtschaft/edelmetalle-gold/bild-beim-gold-schatz-der-deutschen-in-new-york-22990156.bild.html

Someone Shut Lunatic Bibi Up for Now- Iran Talks 

http://www.reuters.com/article/2012/03/07/us-iran-nuclear-israel-idUSTRE8260IT20120307

Trouble In Gold Rigger’s Paradise?

I don’t know if this true. If it is, it could be the beginning of the End of the dollar. I’ve seen no mention in the German press of this. I think this originated at Zero Hedge which is simply not a reliable source. I’m sure the Swiss Referendum is True as I have reported on that in the past. The demand for gold to be returned by Germany and France is not substantiated currently by the FT, typically always the first to know or FAZ. ZH wastes enormous amounts of time floating false rumors. So take this with a grain of source until someone credible reports on this.

Switzerland Wants Its Gold Back From The New York Fed
Posted by Alexander Higgins – March 7, 2012 at 10:25 pm – via Alexander Higgins Blog

http://blog.alexanderhiggins.com/2012/03/07/switzerland-gold-york-fed-91882/

Switzerland is joining the Germans in demanding that their physical gold being stored at the Fed be returned.

Earlier today, we reported that Germans are increasingly concerned that their gold, at over 3,400 tons a majority of which is likely stored in the vault 80 feet below street level of 33 Liberty (recently purchased by the Fed with freshly printed money at far higher than prevailing commercial real estate rates for the Downtown NY area), may be in jeopardy,and will likely soon formally inquire just how much of said gold is really held by the Fed. As it turns out, Germany is not alone: as part of the “Rettet Unser Schweizer Gold“, or the “Gold Initiative”: A Swiss Initiative to Secure the Swiss National Bank’s Gold Reserves initiative, launched recently by four members of the Swiss parliament, the Swiss people should have a right to vote on 3 simple things: i) keeping the Swiss gold physically in Switzerland; ii) forbidding the SNB from selling any more of its gold reserves, and iii) the SNB has to hold at least 20% of its assets in gold. Needless the say the implications of this vote actually succeeding are comparable to the Greeks holding a referendum on whether or not to be in the Eurozone. And everyone saw how quickly G-Pap was “eliminated” within hours of making that particular threat. Yet it begs the question: how many more international grassroots outcries for if not repatriation, then at least an audit of foreign gold held by the New York Fed have to take place, before Goldman’s (and New York Fed’s) Bill Dudley relents? And why are the international central banks not disclosing what their people demand, if only to confirm that the gold is present and accounted for, even if it is at the Federal Reserve?

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4 Responses to Overnight Markets-Leading News-Update 2

  1. Anon says:

    Good story to follow closely. Thanks. Please stay on top of this one.
    Still, FRB, DOD, have leverage over germany and proly served to delay repat so far.
    Parliamentary bills and referendums are easy to confirm and for the media to track. Nationalism is on the rise.
    Will Germany move into Ivan’s sphere, under it’s nuke umbrella?
    Audits are worthless, tungsten, unless each numbered bar is assayed and the full audit published so ben cant audit the same bars multiple times to different countries.

  2. JW says:

    What are the Gremans worried about, 3400 tons is only a measly 5 trillion dollars

  3. vino says:

    This act of repatriating physical within the anglo-system, is in itself an acknowledgement of a return to a quasi gold standard.

    Fears Fed is Loaning German Gold Savings, Germany to Repatriate Reserves
    http://www.goldsilver.com
    MARCH 07, 2012

    http://goldsilver.com/news/fears-fed-is-loaning-german-gold-savings-germany-to-repatriate-reserves/

    The German Federal Audit Office has criticized lax Bundesbank controls of and management of Germany’s 3,396.3 tons in gold reserves. It is believed that some 60% of Germany’s gold is stored outside of Germany and much of it in the Federal Reserve Bank of New York, to facilitate payment and trade, according to German newspaper Bild. A Parliamentary Budget Committee will assess how the bank manages the inventory of bullion totaling 42% of Germany’s money held as savings in reserve.

    Other central banks will follow Hugo Chavez’s “mission accomplished” (Detail Here), and now Germany’s footsteps in bringing home – repatriating – their gold, retaining direct possession of and therefore true ownership, not multiple paper promises of ownership (re-hypothecated).

    Good timing for this type of news, as paper gold shorting has escalated as of recent and can absorb the bids which this news prompted, preventing a paper price spike much higher than the goal of maintaining order allows.

    These moves are important in order to be better prepared for systemic crisis. Clearly this concern is developing, as moves in gold custody become more frequent. If the eurozone were to collapse under the 37x leveraged €3 trillion balance sheet chock full of non-performing “assets” the Bundesbank’s losses would total near €500 billion, more than 150% of GDP. Chart below current to January 2012.

    Should the ECB and the Euro collapse, the gold would be needed to support the Deutschmark currency. This argument alone does not mean the gold needs to be repatriated as Germany is backing the Euro currency system today with their gold being held abroad. The real problem is that the gold held at the Fed could simply be confiscated in order to satisfy dollar swap agreements with the ECB, should they be unable to repay due to an epic collapse.

    This type of event, leading to intensification of the currency wars, brings the ‘nuclear option’ of a drastic upward revision of the price of gold into view. Confidence in re-hypothecated or multiple concurrent gold loans is collapsing, meanwhile the price of loaning gold is at a high.

    This act of repatriating physical within the anglo-system, is in itself an acknowledgement of a return to a quasi gold standard. Nothing more than confidence backs the inverted currency pyramid, and this is confidence lost by those who administer the system.

  4. I did wonder what they might be. Self righteous, self appointed law makers. Too lazy to break sweat, the bain of all.

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