Mark Grant’s Wake Up Call: Italy Has $211 Billion In Notional Exposure To Derivatives And Debt To GDP of 144%!
- The official statistics coming out of the Eurozone are BS. The sovereign debt problem is alot bigger than what they are telling us. Was Greece saved? Debt forgiveness amounted to about €$100-105B but the new debt (2nd bailout) is €$130B. The reality is: their debt problem has just grown bigger by about €$25-30B! The Illuminist banksters have no intentions of solving the debt problem. They are making the problem bigger so that when everything goes to hell, they will own many countries. The sheeple will be turned into perpetual debt slaves!
Mark Grant’s Wake Up Call: Italy Has $211 Billion In Notional Exposure To Derivatives, And Other Trivia!
by Mark Grant, http://www.zerohedge.com/
… Today is March 21, the day after the day that was enshrined in our memories as the payment on the Greek bonds was due. A red letter day that was crossed out by the EU bailout and not even a mention of it today in the Press. The end of the Ides of March or perhaps the beginning of something more ominous; et tu Brutus?
It was nothing more than a footnote in the Morgan Stanley financials; a $3.4 billion pay-out by Italy to settle a derivatives contract made in 1994. Say goodbye to 50% of the tax hikes imposed by the Monti government because that is what was wiped out by this payment. It is also interesting to note that that Mario Draghi, currently President of the European Central Bank, was the Director-General of the Italian Treasury when this derivative was formulated.
Then comes the bomb, only mentioned in a brief article yesterday on Bloomberg, and not noted anywhere in the Press this morning. Marco Rossi Doria, an undersecretary in Monti’s administration, tasked with responding to a parliamentary interrogation on derivatives, admitted that the Italian Treasury had $211 billion in “notional” exposure to derivatives, which is around eleven percent (11%) of Italy’s total GDP. This new exposure, coupled with the work I did a few days ago and noted in my commentary of March 17, now brings Italy’s actual debt to GDP ratio to a whopping 144.3%.
The Unsustainable Path
I call the ball early; that is what I do. I do not sling around Gloom and Doom nor do I make any effort to make the next big call for self-aggrandizement. I stare at the facts, follow the deductive process down the road and present my conclusions. It is as simple and as complicated as that as I made my predictions on Greece, Portugal and Ireland. You may say what you like, attribute it to luck or my friendship with the Wizard but my predictions are in black and white and, once made, there for anyone to evaluate.
So this morning I state, with a great deal of certainty, that regardless of the markets currently ignoring anything and everything, that we are on an unsustainable path that is going to whack us all on the backsides some quarters out. You cannot continue to play charades with the truth and present false data as accurate numbers without the Truth eventually springing out of Pandora’s Box and pulling on your ear lobes.
Please note the increasing size of Target-2, the amount of loans made by the ECB, the decrease in the quality of collateral at the European Central Bank, the real debt to GDP ratios of Italy, Spain, Portugal, Belgium et al and it becomes readily apparent that the pyramid scheme constructed by Europe cannot and will not hold past some indeterminate point in time. Ponzi bonds and Ponzi schemes always work for a while but then the cat comes charging out of the bag, claws out, fangs bared and one bloody mess will be the final outcome.
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