Monday, September 19, 2011

Jefferies Describes the Endgame: Europe Is Finished

Tyler Durden

The most scathing report describing in exquisite detail the coming financial apocalypse in Europe comes not from some fringe blogger or sound - bite striving politician, but from perpetual bulge bracket wannabe, Jefferies and specifically its chief market strategist David Zervos. "The bottom line is that it looks like a Lehman like event is about to be unleashed on Europe WITHOUT an effective TARP like structure fully in place. Now maybe, just maybe, they can do what the US did and build one on the fly - wiping out a few institutions and then using an expanded EFSF/Eurobond structure to prevent systemic collapse.

Importantly, France GDP is only 2 trillion and in bank balance sheets are some 400% of that number. The banks are dead men walking with massive leverage to both home country income as well as assets. The governments are about to take charge and Europe as a whole is about to embark on a sloppy financial market socialization process that has been held back for nearly 2 years by 3 bailouts. The weak links will not be able to raise enough Euros/wipe out enough private sector equity to get this done, so there will be EMU members that need to exit and use a reintroduced currency for this process.

1 comment:

  1. Tell that to helcopter ben who just guaranteed them 3 trillion in paper swaps.

    No sir - make no mistake about it - this is for ALL the marbles and ALL central banks are in on it

    No failure until it all implodes TOGETHER


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