Tuesday, January 31, 2012

Highway to Hell ? Happy Tuesday Edition !

European Bailout Infographic: Presenting The Truckloads Of Cash Needed To Rescue The Insolvent PIIGS

Tyler Durden's picture

...  No, literally truckloads. Our friends at demonocracy.info have been kind enough to put together an infographic that explains the European bailout in simple, visual terms, that even the most innocent of FTL truckers can grasp without much exertion, for the simple reason that it shows all the bailouts amounts in terms of trucks of cash. And here is the kicker: one would need a 13 lane highway, filled with trucks bumper to bumper, stretching for about 3 kilometers to represent the €2.91 trillion in total amounts owed by the PIIGS and their citizens (Click the link above for great info graphics , not that we should   worry about this , right ? ) 
     Well , a brief  rehash yesterday's Summit where nothing much got accomplished which wasn't already expected - the ESM got approved ( details to be supplied later ) , the fiscal compact was approved ( by 25 out of 27 countries - meaning its not legal under EU law as a binding treaty for the 27 country EU and naturally it has been watered down to boot ) , nothing has been accomplished with Greece ( second bailout and PSI deal coming in days , wait for Godot continues. ) Sarkozy continued to make a fool of himself ( starting a fresh row with the UK by saying at one point that the UK had lost its industry ) , vainly  trying to convince voters in France he's worthy of a fresh term in office ( one knows a wrecking hates to stop swinging until the building is totally demolished .)  
     Speaking of Greece , allegedly , the long awaited debt swap supposedly is coming to a head - with a coupon perhaps as low as 3 percent ! Good for Greece , very tough for private investors - naturally the devils will be in the details. At 3 percent and depending on the duration of the payout , the haircut could hit 80 percent ! Which means some of the hedge funds likely will litigate. And of course since 100 percent participation is required , that means Greece will have to pass some type of Collective Action Law to cram down those unwilling to take the sledge hammer write down voluntarily ! Which means CDS finally get triggered - which benefit the basis traders ( traders holding Greek bonds bought fairly recently at cheap prices with greek CDS as a hedge ) And of course the battlefield for the hedgies will be those bonds maturing on March 20th , which allegedly is held by hedgies seeking full payment. Can you say massive game of chicken going on ? And the talk of the ECB and IMF taking a haircut - seems to have vaporized ,  I guess ( like that MF Global customer money ) Speaking of other fables , Greek PM L-Pap say not only must the PSI talks get wrapped up this week , but the overall greek bailout 2 talks must be completed as well ( 130 or 145 billion euros ? ) Wonder how that gets wrapped up when Germany has said no further sovereign contributions above the 130 billion mark will be forthcoming - I guess the details will be coming late , along with Godot.
    One last item , a chart of the day . european unemployment . Good news for Germany , bad news for the eurozone and Italy. Germany sees its unemployment drop to 6.7 percent , a twenty year low. Meanwhile for Italy , the numbers has hit 8.9 and the eurozone at large - 10.4 percent . Youth employment remains staggeringly high across the Eurozone. Here is the chart , read it and weep . Happy Tuesday everyone  : 

Eurozone unemployment