Here is the online dictionary definition of ‘ilk’: sort – kind – species – type – genus – variety – breed. German Chancellor Angela Merkel blatantly lied to her ilk during the 2013 general election there. She told the Germans only a land of milk and honey lay ahead. The opposite is already obviously true.
Whatever the future might be for the German Volk, the future for the Eurozone ilk is quite clearly one of the destruction of fiat money. How terrifyingly predictable has the flow of negative data been since the election result in the Bundesrepublik at last lifted the veil on Truth.
Yesterday – with the ballot boxes still warm – Salvador Draghi told the EU Parliament, “We are ready to use any instrument, including another LTRO if needed, to maintain the short term money markets at the level that is warranted by our assessment of inflation in the medium term”. If ever there was the sort of Premiership obfuscatory bollocks that the late and much-lamented George Carlin would’ve just loved to get his razor-sharp teeth into, then that was it.
So for Carlin fans everywhere, let me just translate that into English:
“The ECB is willing to offer unlimited loans against any old form of horse-dung collateral you want to suggest, at ludicrously low interest rates, to any f**ked up eurobank that wants them, at any time, and anywhere.”
I mean, c’mon: let’s get real per-leeeez. Maintaining short term money markets at a level warranted by an assessment that is medium term in nature. Or to put this into a real-life commercial parallel:
“If I say that next Sunday is the previous Tuesday – based on my insanely optimistic fantasy about Sunday really being equal to Tuesday in all respects except the spelling – then that is the case, so help me Godraghi”.
The Italian piss-and-wind-blown galleon has had to put out this nonsense because the US Fed finally admitted that QE hasn’t worked for the 93.5%. Therefore, Uncle Ben’s Mice are going to keep on doing it because the 6.5% folks it worked for don’t like the idea of it not working for them any more. If you follow.
And also because the Italian’s Alma mater is in pretty bad shape too….another fact that was spookily confirmed just eighteen hours after Geli effectively became that fulsome lady alles über Deutschland. Here’s the heads-up on why the water has reached the neck of the Monte del Paschei’s Flying Circus, via Bloomberg yesterday:
‘Banca Monte dei Paschi di Siena SpA said it suspended interest payments on three hybrid notes after European authorities demanded bondholders contribute to the restructuring of the bailed out Italian lender.’
Note how EU authorities only started the demanding thing the day after the good Frau Doktor Merkel got elected. And note how the word ‘bailin’ is entirely missing from any EU press releases about the Del Paschei disaster.
“Monte likely will have to raise capital next year and we view any capital raising exercise in the market as challenging,” commented Eva Olsson, an analyst at Mitsubishi UFJ Securities in London. ‘Challenging”: there’s another of those Carlin words he so rightly hated.
Two weeks ago – in a piece that went almost entirely unremarked – The Slog predicted a Merkel landslide, asserting ‘….the external data suggest that the German majority is hopelessly wrong. There is in fact every chance that a broader ClubMed insolvency will lead to 0utright default in Italy and Spain. Germany couldn’t afford this, and that’s why – bizarrely – Merkel the faux Euro-unionist may within two years be taking Germany out of the ezone, and splitting the financially incontinent continent into two diametrically different halves.’
I see no reason tonight to change this view.