”Good Gendarme: Recently Downgraded France Opposes German Demands For Greek “Tutelage””
Breaking News Ellis Martin Report with Jim Sinclair http://www.youtube.com/watch?v=9802NwSSS6U
The Impending Undeclared Default Of 5 Major US Banks by Jim Sinclair
@ Youri Carma and evolutis
Thanks, those clowns do sum up the situation quite well in the USA today.
Youri’s images contain a mug shot of the Queen which also made me chuckle.looks like she’s been out wiv sum bova boyz.
@Youri …”Breaking News Ellis Martin Report with Jim Sinclair”
Jim says …
ISDA is more powerful than Governments right now.
It will determine whether the 5 biggest US Banks bite the dust this week :
My view ? …. NO … they’ll just create new spin and lie as usual !
They’ve been doing this since 2007.
”Destination Persian Gulf? US nuclear sub and destroyer enter Red Sea”
PS@Youri …”Breaking News Ellis Martin Report with Jim Sinclair”
Actually, I was the first to mention — HERE and elsewhere — that ISDA .. AND the Politicians …. had agreed to call it a “voluntary haircut – therefore NO credit event” …. just a few hours after it happened !
I therefore think Jim is a bit behind the times here .
Thanks for the link Ray. All 5 major US banks totally wiped out this week unless…… The ISDA decides that a 70% “restructuring” of Greek debt is “Voluntary”. So question number one is, “Why did MF Global go bankrupt?” Because the ISDA declared a 50% write-down of Greek sovereign debt “voluntary”. This ruling made MF global instantly insolvent because it’s CDS hedge didn’t pay out. MF Global was the smallest primary dealer in the chain so it went pop on exposure to Greek debt.
Question number two. “How many other financial institutions will blow up when the ISDA declare a 70% write-down as Voluntary?” Obviously many more will be wiped out and also the illusion that CDS are an effective hedge against default risk will be broken. This means, any firm or pension plan, Etc. That are hedged like this will experience a huge loss in value. (Because they are not hedged if the CDS doesn’t pay out on a 70% write-down.
On the ISDA website is has a Q&A PDF about it but it’s very deceptive. It talked about net exposure as just a few billion. So what do they mean by net exposure? I think they mean offset by counter party agreements. The problem is that these 5 US banks hold 90% of all the derivatives in CDS. So who are the counter parties? I suspect the answer maybe themselves in a circle jerk. The reason I think that is because only they are big enough to counter party this much exposure. Unless you were “Too big to fail” this gang would just eat you like they did MF Global.
The issue is that if the ISDA does call a 70% write-down a default, all 5 TBTF banks are wiped out this week. Obviously they won’t do this but it will be interesting to see if they can announce a “non credit event” at 70% write-down with a straight face.
Expect some large European failures from this ruling, a new leg down in market confidence and massive and desperate QE (very bullish for Gold and silver). Even if they can somehow get away with this outrage, it’s only a matter of a few short months before this happens again at maybe 90% write-down. Again they will have to declare this as a “non credit event”. At that point, no sovereign will be able to sell bonds to anyone because the hedges they need to take out the risk turns out to be just a massive insurance fraud.
As An interesting kicker, the small change in US Bankruptcy law means that the derivative holders (The same 5 banks) get first call on pay outs in the companies that their fraud has bankrupted. They can just take everything including all the customer accounts and force the FDIC (Taxpayers) to bail out the account holders who were robbed.
See Ray from Canada’s link for the 29 minute interview with John Sinclair. There’s a total mainstream media black out on this. They are hoping to do the deed in secret and then and then present a done deal.
Worse to come: Derivatives are leveraged at 100:1. To work out the size of the hole, take the hundreds of billions that has been raised by the banks through selling the fresh cut issue of these contracts and multiply that figure by 100! Think economic mushroom clouds!
The inverse loss is 100 times the obverse gains made.
can someone answer what would happen if interest rates went back to 5%, it was said on this show recently that if they went back to that level in UK half of the home owners would default on mortgages…would it be better to wipe out the parasitical speculators or the home owners ?
@ Danny Cunnington
Meanwhile the Triumvirate of Blair, Bush and Rice just took over America’s reserve tank, AKA Nigeria.
JP Morgue as of this year is now an in Oil in Nigeria and Syria, as well as Lybia and has Gold mines in Afghanistan.
The Morgue has been busy over the Holidaze.
I guess Fraud never sleeps.
Re: ISDA, CDS, Jim Sinclair interview. Interesting. He repeated himself so often and so slowly that even I started to understand what he was saying. He did rather tend to emphasise the “positives” though didn’t he? Good job we’ve got Danny C to lay out the negatives for us. What will be the new name for retirees/pensioners when they will no longer have a pension, and they cannot afford to retire. Surely the nazis will be pushing the euthanasia option on us for the ultimate solution to “useless eaters”?
@ inquisitive mind
can someone answer what would happen if interest rates went back to 5%, …..
The UK would be a squatters paradise, the streets would be full of Hippies, and the price of an ounce of Hashish would become the defacto currency standard.
@Al Kyder, And of course, the IMF has just forced a national oil workers strike by insisting that all the fuel subsidies which the oil workers need to make a living must be stopped and the money turned over to the insolvent IMF. Meanwhile, on the quiet, there’s loads of US and other NATO troops stationed in Libya trying to protect the oil investments. Of course the soldiers won’t be totally pissed off that they are not fighting for their country but for a TBTF bank that the taxpayer has been forced to subsidise. Than of course all the bills for the troops gets picked up by the taxpayers too.
You only have to look at the slowdown in the developed countries to see that without NATO threatening Iran for completely bogus reasons (Even the head of the CIA admits has “no basis in reality”), The IMF causing a strike in Nigeria and the NATO looting and destruction in Libya and the oil price would probably be below $50 right now.
The EU sanctions achieve nothing other then attacking the economies of Greece, Italy, Spain and Portugal. Much of their refinery capacity needs a blend with Iranian oil or it can’t refine without rebuilding refineries. Of course the refined products glut in those countries mean they are already teetering on bankruptcy. They will probably shut down because countries like India can take Iranian oil, refine it into products and sell it to those European countries for Euros.
As Europe isn’t even remotely threatened by even a bogus Iranian threat, the sanctions are a bit of a mystery unless the intention was to make the on-going crisis worse by design and goose the oil price to price gouge the unwashed masses.
The other little snippet I heard was that the US has offered to foot 100% of the military bill to any NATO forces who join it in it’s unilateral threat of pre-emptive war against Iran.
In other diplomatic rumours, Israel is darkly muttering to the UK & US that it could just tell the world that 9/11 and the London 7/7 05 were false flags and they have all the evidence. The Israeli logic is, “We’ll see who this damages the most”. They are of course right. Israel has little reputation to lose and it’s an expert in playing victim. It could easily claim they had no choice but to participate because of the huge aid it relies on from these two countries. Of course, because they revealed it they could claim whistle blower moral status.
So expect terrified politicians to do exactly what Israel tells them.