Sovereign debt bubble thread

[Admiral Yi]

History will prove us right.  They can put it on our tombstones.

If we can afford tombstones.

You're talking about Keynes, right?

You don't have to wait, history already knows you're right.  Deficit spending increases GDP when there is unused capacity.

Those Eurozone countries are not practicing austerity because they doubt Keynes' model, they're doing it because nobody will lend them the money to do it.

[Ed Anger]

?

We're sorry, this product is not available. [no picture, nada]

The brain is the biggest erogenous zone I guess.

HOLY SHIT. SUPPLIES ARE RUNNING OUT. PANIC.

Anyways, it was this:

http://www.shelfreliance.com/basic-1-year-dehydrated-food-supply.html

[Ideologue]

If they've got astronaut ice cream, I'm so there.  If you want a vision of the future, imagine me clutching an AK-47 that I have no idea how to properly maintain, camped out in the Cape Canaveral gift shop with chalky deliciousness smeared all over my face.

[Ideologue]

History will prove us right.  They can put it on our tombstones.

If we can afford tombstones.

You're talking about Keynes, right?

You don't have to wait, history already knows you're right.  Deficit spending increases GDP when there is unused capacity.

Those Eurozone countries are not practicing austerity because they doubt Keynes' model, they're doing it because nobody will lend them the money to do it.

I'm not blaming Ireland.  I'm blaming the ECB.  They demanded the austerity measures in the Eurozone crapholes, right?

[Ed Anger]

If they've got astronaut ice cream, I'm so there.  If you want a vision of the future, imagine me clutching an AK-47 that I have no idea how to properly maintain, camped out in the Cape Canaveral gift shop with chalky deliciousness smeared all over my face.

There is a supply of that shit at Wright Patterson in the Museum cafeteria. And the Gift shop. I'm surprised there wasn't a astronaut ice cream dispenser in the restrooms.

[Ideologue]

I really, really wish they sold it grocery stores.  I mean, I know I can order it online, but that does not meet my impulse consumption needs.  You can't plan ahead for the snack attack.

[Ed Anger]

I really, really wish they sold it grocery stores.  I mean, I know I can order it online, but that does not meet my impulse consumption needs.  You can't plan ahead for the snack attack.

Got a planetarium nearby? They usually show up in those.

[mongers]

?

We're sorry, this product is not available. [no picture, nada]

The brain is the biggest erogenous zone I guess.

HOLY SHIT. SUPPLIES ARE RUNNING OUT. PANIC.

Anyways, it was this:

http://www.shelfreliance.com/basic-1-year-dehydrated-food-supply.html

That stuff is crap and it'll give you the craps as well.

Plus how come it's only going be be giving you 1300 cals per day, that's not sustainable for a year.   

For $1200 you could buy a much better balance selection of emergency food.

[Ed Anger]

It.was.a.joke.

[The Brain]

I don't see anyone laughing.

[jimmy olsen]

  If you want a vision of the future, imagine me clutching an AK-47 that I have no idea how to properly maintain

AK-47 are a piece of cake to maintain.

[jimmy olsen]

Great news! 

http://www.nytimes.com/2011/12/29/business/global/italys-borrowing-costs-drop-sharply-at-auction.html?_r=1

Italy's Borrowing Costs Plummet, Reducing Pressure
By HARVEY MORRIS
Published: December 28, 2011

Italy's short-term borrowing costs dropped sharply on Wednesday at an auction of government bills, easing the immediate pressure on the country's economy.

The sale of 9 billion euros ($11.8 billion) of six-month Treasury bills was seen as the first postholiday indication of the condition of the beleaguered euro zone, the 17 members of the European Union that use the euro.

The bills were sold at a yield of 3.251 percent, down from 6.504 percent at a previous auction in late November. Demand was 1.7 times the amount offered, compared with 1.47 times previously.

In an auction of two-year bonds, which raised 1.7 billion euros, the yield fell to 4.853 percent from 7.814 percent last month. The auctions raised a total 10.7 billion euros.

The lower borrowing costs appeared to reflect the adoption of a new austerity package in Italy, as well as a huge infusion of low-cost, long-term liquidity into euro zone banks by the European Central Bank last week.

With the central bank now charging only 1 percent interest on three-year loans, banks can take the cash, buy short-term securities and earn a quick profit.

In anticipation of the loans, Spain's borrowing costs fell drastically at an auction on Dec. 20. And the central bank will offer the three-year loans again in late February.

On Thursday, Italy plans a sale of 8.5 billion euros ($11 billion) in long-term debt, which analysts said would be a more significant indicator of market sentiment.

The brighter outlook for Italy was reflected elsewhere in the debt markets, where Spain's long-term borrowing costs fell to almost 5 percent. German bonds, a benchmark for the euro zone, edged lower to 1.89 percent.

"The target size of the auction was in line with the intended amount," analysts at IFR Markets wrote in a note after the Italian debt sale, "so over all a smooth auction."

The sale of long-term debt on Thursday probably will "go the same way," they added, "as domestic players come in to support" the bonds.

Nevertheless, there was evidence that the financial system remained stressed. The central bank reported that banks in the euro zone had deposited a record amount of overnight funds for the second day in a row. Banks parked 452.03 billion euros ($584 billion) for 24 hours, beating a previous record of 411.8 billion euros set on Tuesday.

The heavy use of the deposit facility indicates that banks in the euro zone remain wary of lending to one another, although analysts note that market activity has been muted because of the year-end holidays, and there is more cash in the system after the central bank's action.

Italy has been in the spotlight as a result of slow growth combined with escalating borrowing costs and a debt equal to 120 percent of gross domestic product. It needs to raise 450 billion euros ($582 million) in 2012.

Italy suffered its biggest decline in Christmas retail sales in 10 years, according to data released this week by the consumer group Codacons.

[The Minsky Moment]

Good news but . . . the Italian 10 year yield did not improve in secondary trading, which indicates long term sentiment is still poor.  And not surprising because even at 3.25 - 4.85 percent, the interest costs are still too high for ultimate sustainability.

[Sheilbh]

I thought today's 10 year auction was less joyous.  They didn't sell as much as hoped and the yield was back under 7% but barely.  Hopefully things'll improve once Monti presents his 'Grow Italy' plans.

[Admiral Yi]

Maybe a few more demonstrations will lower those 10 year rates.