The ECB, where next?

Exhibit 1: A speech by Lorenzo Bini Smaghi, as reported on by Yves Smith:

nakedcapitalism.com/2010/05/ … risis.html

The comments are interesting too, if one-pointed - picking up on the ECB’s hypocrisy over the rating agencies and largely ignoring the rest of the criticisms.

Also knowns as the “short and distort” tactic described by James Kramer. Apparantly, its when a bunch of hedge funds or speculators all go short on something and then plant distorted stories in the media to further undermine confidence in whatever theyre shorting. This amplifies prices falls and allows them to profit further.

A good example of short and distort was the rumour put about last friday that Sarkozy theatened to pull out of the euro. Total exaggeration put about to further the euros fall and make more profits for the speculators.

On the bond purchases, some analysis:
ftalphaville.ft.com/blog/2010/05 … n-context/

I particularly liked this bit:

Not so much for the rather anodyne content, but more for the analyst’s name. Rather appropriate for the bond market?

“Opening the kimono” has to be the most ridiculous business buzzword to have come out of the last ten years. Hopefully, it will die the death it deserves soon, never to be heard from again.

Should we draw a discrete veil over it?

:laughing:

a little Off Topic but, if you’re wondering “Where Next” for the ECB in the Medium to Long term :

bloomberg.com/apps/news?pid= … yVt07YvEWg

Weber appears to have the ECB Presidency in the bag - Wolfgang Munchau in the FT also said as much today -

Stark - is appropriately enough a noted Inflation Hawk (appropriate if you speak ze German…) - and Weber is cut from the same cloth

ft.com/cms/s/0/7e114d26-6115 … ab49a.html

Holy shitola, how do the German’s make head or tail of what their compatriots are saying?:

Stark:
adjective

  1. strong
  2. high
  3. heavy
  4. powerful
  5. thick
  6. great
  7. severe
  8. large
  9. marked
  10. considerable
  11. intense
  12. substantial
  13. deep
  14. tough
  15. potent
  16. robust
  17. violent
  18. profound
  19. bright
  20. loud
  21. bad
  22. mighty
  23. keen
  24. stout
  25. forceful
  26. broad
  27. vivid
  28. profuse
  29. stiff
  30. able
  31. hearty
  32. virulent
  33. vehement
  34. wild
  35. high-powered
adverb
  1. strongly
  2. heavily
  3. greatly
  4. very
  5. severely
  6. hard
  7. badly
  8. a lot
  9. grossly
  10. keenly
  11. profusely
  12. brightly
  13. really well
    (Google translate)

PS not off-topic at all!