Yanis Varoufakis

Four Blood Moons Calling? Greek Elections again, S&P Minicrash, Gold bear over?

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Well, if the whole blood moons thing is correct, which I still doubt but it is possible, then the picture has to start deteriorating fast. Like now, within the next two months. According to Blood Moon Theory or whatever you want to call it, we have until Hoshanah Rabba 5776 for the world to change somehow.

Today, the S&P broke medium term support at 2040, gold is up again, miners up 20% since bottoming late July, China crashing again, VIX up 25% in one day. I’m long gold and miners (obviously), no longer short China anymore, but long the VIX expiring in November since covering the China short.

Let’s clarify this “China devaluing” mumbo jumbo for a second. China has a “peg” to the dollar. That means the PBOC doesn’t allow the Renminbi, or Yuan or whatever they call it, to trade below a certain exchange rate with the dollar. They control it by buying or selling dollars whenever it gets too close. China is not “devaluing” its currency so much as simply letting it trade below a previous peg without the PBOC selling dollars to strengthen it to within an arbitrary peg. Why are they doing this? They think they need to in order to “stimulate exports” which is a bunch of crap, like saying you need to take hit of your crackpipe to think clearly. Yeah, maybe for 3 seconds, but then you go nuts.

Now Vietnam and Kasakhstan and a whole bunch of other countries few people care about economically are doing the same thing. The peg is manipulation. Releasing that peg is allowing the free market to trade the currency.

I’m in the US now, and this is the first time in years I’ve even put on main stream financial media around market close today just to see what they say. The bullshit is so thick you can’t cut it with a chainsaw. Nobody has any clue what they’re talking about, and they all say that in different words.

Greek elections are happening again. My hope is Yanis Varoufakis will get off his butt and run for Prime Minister in a new party. He’d win hands down, I think, and send the banksters to hell. He’s the only one that would do it. September 20th apparently is the date.

Gold is on its way up past $1,150 after bottoming (hopefully) at $1,072. If this is the bottom, it’s been a long time coming.

When the S&P broke support since February when it steamrolled through 2040, it was in the last 15 minutes of trading today. If stocks don’t bounce back sharply tomorrow morning early, then the next support levels are at 1972. If that gets broken, 1820 is next. Tomorrow is a very important day for stocks. If they don’t bounce early, they probably won’t bounce.

Let’s see what happens.

GREECE CAVES: Will Yanis Varoufakis Come to the Rescue?

rafifarber Eurozone Crisis, The Jewish Libertarian Blog

He may have resigned as Finance Minister but the guy is pissed. Greece not only completely caved. They agreed to sell off 50 billion Euros of assets to the banks. Governments selling assets is good. But selling them to German banks is definitely not good.

Varoufakis has a Q&A up at Zerohedge that shows both sides of him pretty well. That gross white-wine-socialist side that seems to shrug off all the grotesqueness of the situation, and the human side of him. These are the most interesting lines: (The full interview can be found here.)

 “It’s not that it didn’t go down well – there was point blank refusal to engage in economic arguments. Point blank. You put forward an argument that you’ve really worked on, to make sure it’s logically coherent, and you’re just faced with blank stares. It is as if you haven’t spoken. What you say is independent of what they say. You might as well have sung the Swedish national anthem – you’d have got the same reply.”

This weekend divisions surfaced within the Eurogroup, with countries split between those who seemed to want a “Grexit” and those demanding a deal. But Varoufakis said they were always been united in one respect: their refusal to renegotiate.

“There were people who were sympathetic at a personal level, behind closed doors, especially from the IMF.” He confirmed that he was referring to Christine Lagarde, the IMF director. “But then inside the Eurogroup [there were] a few kind words and that was it: back behind the parapet of the official version. … Very powerful figures look at you in the eye and say ‘You’re right in what you’re saying, but we’re going to crunch you anyway’.”

Varoufakis was reluctant to name individuals, but added that the governments that might have been expected to be the most sympathetic towards Greece were actually their “most energetic enemies”. He said that the “greatest nightmare” of those with large debts – the governments of countries like Portugal, Spain, Italy and Ireland – “was our success”.“Were we to succeed in negotiating a better deal, that would obliterate them politically: they would have to answer to their own people why they didn’t negotiate like we were doing.”

The deal now has to go through a bunch of parliaments. Who knows if it will. But here’s a scenario that no one sees coming. It’s a long shot, but possible. The plan is implemented at the expense of the Greek government collapsing and new elections being called. Varoufakis is pleaded to run at the head of a new party. He wins.

And he scraps the deal.

Yanis Varoufakis is not a good economist. He’s a very bad one. But he does not covet power either. He’s half human, unlike the others who aren’t human at all. If he is forced into the Prime Minister’s seat, anything could happen.

We’ll Miss You, Yanis Varoufakis

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I’ve always had mixed feelings about the guy. On the one hand he’s a commie. On the other hand, he promised not take any bailout money and he never did.

He has resigned, saying:

Soon after the announcement of the referendum results, I was made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my… ‘absence’ from its meetings; an idea that the Prime Minister judged to be potentially helpful to him in reaching an agreement. For this reason I am leaving the Ministry of Finance today.

I consider it my duty to help Alexis Tsipras exploit, as he sees fit, the capital that the Greek people granted us through yesterday’s referendum.

And I shall wear the creditors’ loathing with pride.

I believe it was entirely Varoufakis who prevented any more bankster bailouts, and for that he should be commended. I fear that Greece may yet break if he’s not there.

I can proudly say that though at times I can’t stand the guy, I found him and thought he was cool before it was cool to think he was cool.

Can Greece Pay Up €750M Tomorrow?

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Yanis Varoufakis says it can be paid. Many aren’t too sure about that. But even if it is, there won’t be enough money left to pay Greek bureaucrats, who will have to be issued IOU’s, which will start circulating as a parallel currency, which will be a de facto exit from the Euro. I went over this in my column for  TheStreet.

The Greek government passed a controversial bill on April 24 mandating local governments to transfer idle cash reserves to the Greek Central Bank. From there, the funds can be borrowed by the state to (theoretically) squeak by its upcoming IMF bill, totaling €967 million ($1.05 billion): some €201 million of interest payments, due by May 6, with a €766 million principle payment coming up on May 12.

The problem is, the bill might be far too little to help.

It looks like the Greek State will barely get through May 6, but after that, the numbers are disputed, and time is of the essence. While the government estimates the idle cash seizure move will net anywhere from €1.5 billion to €2.5 billion, secondary reports of local Greek media claim that only €160 million has actually been collected from local authorities, hospitals, universities and municipalities.

Whether the Greek State defaults to the IMF or defaults to its own bureaucrats doesn’t matter. They want to spend more money and the people who print the money don’t want to give it to them. So they’ll have to print their own. That is the meaning of Grexit.

Watch Italian bonds. They’re next.

Varoufakis Goes Full Retard

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Never go full retard.

(I realize that this joke is insensitive, but I couldn’t resist. Forgive me.)

When you go politician, you go a little bit in, dabble your foot, play with words, deflect a question or two. But you never go full politician. ESPECIALLY when you state publicly that you will resign the minute you sense that you are turning into a politician.

Yanis Varoufakis has gone full politician, full retard, no holds barred (I don’t know what that means) all-in, I call your “Definition of Is” and raise you a “My twitter account was hacked and that’s not my penis!” and add another quadrillion.

Caught in a 2013 video giving the finger to Germany, Varoufakis replied:

“That video was doctored. I’ve never given the finger, I’ve never given the middle finger ever.”

Are you #$%^ing kidding me Yanis? Doctored? That’s what you’ve been reduced to? Taking Hedonism-Bot pictures of yourself living a life of luxury off of BAILOUT money?

Varoufakis Goes Full Retard
Varoufakis and his Trophy Wife, Living it Up on Bailout Money While Greece Burns
Yanis Varoufakis
Yanis Varoufakis’s Cartoon Doppleganger

And then THIS? Denying you gave the finger when you CLEARLY did, and even if it were, by some crazy conspiracy, actually doctored, you were CLEARLY TALKING ABOUT IT YOU IDIOT! (Finger at 1:50 mark)

What a disgrace you have become. NOT because you gave the middle finger to Germany. If you want to give the finger to Germany, give the finger to Germany! Just default and leave them holding the bag, see what happens! Just like you said!

But you know why he’s going full politician and has to calm the waters now by pathetic lying? Because if he really gives them the finger now, he’s kicked out of the Euro. Varoufakis never wanted to leave the Euro immediately. Why? Because his problem is that Greece has no Drachma to stuff its banks with and he thinks that the economy would have no money and revert to BARTER (such stupidity) for 8 months while they were busy printing them. He doesn’t understand that money would revert to gold and silver and copper and prices would adjust accordingly automatically. But that’s because he’s a Marxist idiot.

He also doesn’t want the Greeks to know he’s printing Drachma because then Euros would flee the country so as not to be converted to Drachma. So what he wants to do is SECRETLY print drachma, THEN default, THEN watch the value of the Euro tank to nothing, THEN tell the Greeks he has Drachma, THEN leave the Euro. He makes that sick evil scheme VERY CLEAR at the end of the video.

Result being that Greeks do not have the opportunity to ship whatever money they have left out of the country, everyone loses his savings while the government gets to start fresh, spending money, zero debt. That’s why he’s going full retard. Because he’s busy stealth printing Drachma, and when he defaults, he wants to convert Euros overnight to Drachma without warning his people. Screw him.

Greeks, get your money OUT of the country NOW and out of the Euro as well or you will all lose everything because of full retards like this clown. Varoufakis is going to sink the ship without warning you first. I’m warning you now.

Afra Lepumei, Yanis Varoufakis. What a joke. I’m ashamed I ever thought anything positive of you.

GREEK SADNESS Tsipras and Varoufakis Completely Cave Like Dogs

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If I were a Syriza fan, of which I absolutely am not, I would see this line as the saddest letdown ever. From Bloomberg, and it’s really, really pathetic. I almost feel for these sad Greeks. Not for Tsipras, but for the people. Just sad.

Prime Minister Alexis Tsipras is trying to access European bailout funds for Greece without completely ditching the anti-austerity agenda that won him election seven weeks ago. So far he’s dropped demands for a writedown on Greek debt, abandoned his plan to halt privatizations and accepted that he won’t get “bridge financing” without signing up to conditions.

In return he’s won concessions to shift some meetings to Brussels and persuaded European officials to describe the country’s official creditors as “institutions” rather than “the troika.”

So that’s it then. All Tsipras and Varoufakis have been able to get out of the EZ overlords is to change their name a bit so it doesn’t sound as bad. And move some meetings to Brussels. Wow.

But even sadder, is they couldn’t get even that.

 Greek officials are not hiding their frustration at the reappearance of the dreaded word “Troika” in statements made by several euro zone finance ministers today, reports Helena Smith.

The German finance minister Wolfgang Schauble, no less, used it four or five times – in what some are calling a deliberate act of spite.

Why is a worthless name change for the same freaking people and their sophisticated bailout acronyms so damn important? I don’t think it’s just an emotional thing, though that is part of it.

They want to be able to lie more convincingly to their sad Greek people that they did something positive, that the “Troika” is no more, that there are “different” people auditing us now, that everything is different.

But if the Germans keep calling a spade a spade, they can’t pass the lie.

Syriza did nothing, as expected. And Varoufakis cowers along. His fire is gone.

In retrospect, I should have seen this coming. Varoufakis wanted a writedown and to stay on the Eurozone. He was never going to get both. He can have a full writedown of course, but the ECB will never give Greece another Euro cent in that case.

GREXIT The Real Question is, Do the Morons at the ECB understand the Consequences?

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Here we go again with Greece. With Zero Hedge reporting (they really are on top of the latest crap, got to give them that, even if it’s sometimes overstated):

Unfortunately for Greece, moments ago Germany’s Frankfurter Allgemeine Zeitung confirmed the bad news, when it said that the EU commission has rejected the Greek request for speedy aid payments, cites Valdis Dombrovskis, EU commissioner for the euro. The commissioner adds that the Varoufakis letter “lacks specific enough action plan and that the reform steps must be approved by Greek parliament and be implemented.”

In other words, as we reported before, Greece is back to square minus one, where first Europe will send the dreaded Troika inspectors “on the ground” in Athens to catch up to everything they have missed in the months they have been absent and then, and only then, does Greece have any chance of even being seriously considered for more aid.

I’ll stop pretending I know what’s going on here. But the funniest part is that Greece (may have, depending on whether you think ZH is credible or not) issued a plan to use foreign tourists as wires against tax evaders, a plan which was laughed at by European creditors, Troika, ECB, EFSF, whatever:

Financial Times reports that the reaction from eurozone officials to the tourist plan was received with humor. They thought the proposal was hilarious and even laughed when they read it. “It’s quite hilarious, if it were not so tragic, that this is what a government in an industrialised country comes up with,” said one eurozone official involved in the talks.

Here’s the question really. It all comes down to this. Does whoever is financing Greece currently, with whatever stupid acronym they use to name themselves, really understand the consequences of a Grexit? Do they undestand the chain reaction that will ensue, given that the world is embroiled in a debt crisis the likes of which it has never, ever seen in history?

If they understand it, they will keep funding Greece indefinitely. If they don’t, they will start a chain reaction that will end the entire game.

Maybe I’m wrong. That’s what I think.

I’m reminded of a line from Payback, that Mel Gibson movie where Porter goes after the whole Outfit by himself for $70,000 he claims was stolen from him. Porter is looking for the one man in charge of the outfit. He says to one of the gangsters, “One man… you go high enough you always come to one man… who?”

It’s the same in legalized gangs like the Eurozone. You go high enough you always come to one man. Who? And does he understand that he has the trigger to the entire pile of cards collapsing in a matter of weeks? By that I mean everything the whole western financial system?

If he gets it, it’ll be a few more years. If he doesn’t get it, it could be any day now. But I don’t know, because I don’t know who that one man is.

Greece Caves, Varoufakis Fails, He Should Resign Immediately

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Oh well. I was wrong. I thought I was on to something with Varoufakis but apparently a grasp of basic economics (which Yanis Varoufakis does not quite have) is a necessary condition for having a spine. I thought that maybe it didn’t have to be that way, but he caved to a bailout extension of 4 months, and once you let the door open a crack like that, that’s it. There’s no going back. He’s a politician now. It’s over.

Zerohedge is reporting that Varoufakis actually sent a letter to the Germans sticking to his guns, with Tsipras then overriding that letter when the Germans said no deal. Varoufakis is denying there was ever any wrong letter. Who knows, now that he’s caved and won’t admit it, no one can trust anything he says anymore.

So four months from now this whole thing will repeat again.

Eventually though, reality will express itself with full force and the Eurozone will collapse. We just can’t count on anyone to be honest enough to get the ball rolling voluntarily. It will have to happen by some surprise event now.

The reality is, Greece still cannot pay back its debt, and the Syriza government sure won’t allow the economy to grow by getting out of the damn way. It looks like more debt slavery for the average Greek now. For four more months at least.

If Varoufakis were honest, he’d explain publicly why he has reversed himself from saying “no extension” to “four month extension”. But he won’t. He’s descended into the realm of the politician.

Varoufakis Holding his Own, Germans want him replaced!

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The Greek talks with the Eurozone just broke down again. There currently is no way forward. Greek bank runs may start as early as tomorrow. If they do, the Eurozone will disintegrate fast. Most people did not see this coming and thought Greece would cave. But I did. I felt Greece would not cave, at least strongly suspected it. Here’s why.

I don’t have much investment in Yanis Varoufakis other than fascination and an inkling he can hold his own. He’s showing the Eurozone leaders that he’s not a yes man, not a politician, but a guy with principles that won’t break.

Most commentators on my side of the spectrum, the libertarians, armageddonists, preppers and those folk simply assumed that Greece will cave to Troika demands sooner or later, but that’s because they haven’t been following Varoufakis for three years like I have. Or maybe it’s just a 6th sense I have or something that I recognized with Ron Paul and Feiglin, and to a certain extent with Varoufakis. This harks back to my Ron Paul article about soul.

Varoufakis is wrong about a lot of stuff, even about basic stuff, but he has a soul. And he will not break from what he sees as right. Tsipras and the rest of Syriza are all a bunch of politician monkeys and they’ll cave. But Yanis Varoufakis won’t. Interestingly, Varoufakis is not even a Syriza party member.

Bob Wenzel recently quoted Tyler Cowen, a mainstream economist, as saying this:

The Greek government will cave so cravenly on the substance that they want to have it on the record books that they supplied some expressive goods for a few weeks’ time, namely insulting the Germans and claiming that the Troika is dead and buried.

See, that would be true of any Greek politician except Varoufakis. He won’t cave on anything, unless absolutely ordered to do so, in which case he will resign, as he has said explicitly that he keeps his resignation letter in his inside pocket and will submit it the moment he feels he can no longer speak truth to power. Or his version of it anyway.

Even the bloggers on my side of the aisle like Wenzel simply don’t understand this. I covered this in my column two weeks ago at CalvinAyre, where I said the following:

In a nutshell, it’s like this. If just another politician occupied the Greek FinMin seat, eventually he’d be bought off by the Troika, that trifecta of acronyms like ESM and EFSF that hold all the bailout funds, and the proverbial can would be kicked down the road again. But Varoufakis is not just another politician, and that’s what political mainstreamers, as well as Eurozone leaders themselves, just don’t understand. He’s serious. He wants to default, he’s been saying it for years, and he is the only one with the guts and independence to mean what he says and do it.

Varoufakis still may cave. I don’t have as much faith in his strength of character than I do of Ron Paul or Moshe Feiglin, but so far he has been holding up. How much longer I don’t know. But we can safely assume that since he has not yet resigned, he has not caved.

Now, at the prospect of Greece being kicked out of the Euro, Varoufakis could get fired. Once he’s out, if that happens, you can be sure Greece will cave. Tsipras is a nobody, that I’m sure of. Zerohedge is reporting now that the Germans want Varoufakis out. Why? Because he literally is the only obstacle in the way of continuing this disgusting bailout. There is no one else in the way. Just him. Quoting Keeptalkinggreece:

An SPD politician from Merkels’ social-democrat coalition suggested s that Prime Minister Alexis Tsipras should replaces Finance Minister Yanis Varoufakis as he apparently creates lots of confusion, German politicians cannot understand.

SPD executive board member, Joachim Poß, wrote in an e-mail for his party colleagues:

“Greek Finance Minister Varoufakis has best demonstrated with his performance  until now, that he is not up to the demands of such an office. In the interest of the Greek people and in view of the difficult situation, Prime Minister Tsipras should consider to replace Mr Varoufakis with a political experienced, realistic-efficient person.”

Let me take that last bold paragraph out of Orwellian Newspeak and translate it into Human:

“Greek Finance Minister Varoufakis has best demonstrated with his performance until now that he is not up to simply caving to our demands for fear of being kicked out of the Euro. In the interest of the German government oligarchy and in view of the difficult situation, Prime Minister Tripras should consider to replace Mr. Varoufakis with a politician.”

Watch Greek capital flight tomorrow. It could get intense.

GREEK INSANITY Tsipras’ Solution to Insolvency is More Free Stuff

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We’re headed for default in Greece. Varoufakis may have human guts, but he’s still clueless, still doesn’t understand that the Everlasting Gobstopper doesn’t actually exist. That the government cannot simply supply endless resources at a whim. Just doesn’t get it.

Tsipras of course doesn’t get it. So it’s funny I should be reading this headline on Ynet first, in Hebrew. The other headlines to the same story do not catch the punchline. But the Israeli headline does. For example, Reuters:

“Defiant Greek PM sets up EU clash with bailout rejection, austerity rollback”

Ah, but the Jews get it. They get that you can’t solve an insolvency problem by handing out free stuff. Ynet, on the same story:

ר”מ יוון מציג: חשמל ומזון חינם לעניים

Greek Prime Minister Lays Out Plan: Free Electricity and Food for the Poor

Yeah, that’ll do it. That should put you right back on the road to financial stability. Hand out more free crap. Suck on the Everlasting Gobstopper that is government money.

What’s happening here, from what I can see, is a crazy angry Prime Minister with extreme Greek pride is combining with a confused Finance Minister with the guts to push Europe to the brink and over, with neither realizing at all the meaning of their “solutions”.

We’re on our way to default. The eurozone is going down folks, in weeks to months. Brace yourselves.