October 15, 2011

Newflash: CNBC's LIESman Lies Again - US has decided against expanding the IMF - Very Late On Friday Evening

US "Pours Cold Water" On IMF Expansion Plans, Leaves European Bailout To Europeans | ZeroHedge

It is probably not too surprising that the negative news of the day, namely that the US has decided against expanding the IMF and thus leaving the European bailout to the Europeans (at least for now), was released quietly long after happy hour started on Friday.
"U.S. Treasury Secretary Timothy Geithner and his Canadian and Australian counterparts poured cold water on the idea" of injecting $350 billion into the International Monetary Fund. As a reminder, the IMF expansion myth was one of the latest rumors floated today by none other than the tag team of Geithner and Liesman. It lasted less than24 hours but it served its purpose.
The second priority is to get the world's solvent countries' future so deeply intertwined with that of the bankrupt ones, that letting Greece, and hence France, would result in a Global Assured Destruction.
FT informs us that according to Greece itself any haircuts over 21% are out of the question: The lead negotiator for private holders of Greek debt has said that investors are unwilling to accept greater losses on their bonds than the 21 per cent agreed in July, jeopardising eurozone plans to finalise a second Greek bail-out by the end of next week.   Charles Dallara, managing director of the Institute of International Finance, criticised European leaders on Friday for failing to allow the July deal to proceed. He said any greater losses imposed on Greek bondholders could prompt investors to sell the sovereign debt of other eurozone countries, destabilising the single currency.   “We do not see that a compelling case has been made to reopen the deal,” Mr Dallara told the FT. “A deal is a deal.”
At 21.01% it becomes involuntary... and hence triggers CDS according to even that most corrupt of deterministic organizations, ISDA. And once there is an official Event of Default, and the multi billion CDS complex starts collapsing on itself, exposing the whole premise of "gross exposure is not net" due to bilateral netting for the lie it is, the not even the loftiest lies and the most incredible propaganda won't do anything to lift the offer in the EURUSD.

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