European Parliament president Martin Schulz said his faith in the Greek government had reached "rock bottom," and, as AFP reports, that he hopes it resigns after Sunday's referendum. Luckily, he has an idea for a solution... the time between the departure of Tsipras' hard-left Syriza party and new elections would have to "be bridged with a technocratic government, so that we can continue to negotiate." Just what The Greeks need - another "Yes man" puppet government to implement whatever Europe's bankers demand.
"... this [Greek] debt is so big that everyone understands that it won’t be repaid. Loans to Greece have just bought time so that those in power don’t have to take decisions. This is like a game: who can hold out longer by not showing that this money has been lost? This burden has become bigger and there obviously is no possibility to repay.... debt writedown of Greek debt will come after bankruptcy of state."
The US oil rig count rose 12 last week - the first rise since December and biggest absolute rise since October 2014. WTI Crude is sliding on the news... pushing near a $56 handle again.
Two short months ago, Yelp's share price collapsed following dismal earnings. Within days the company had an idea for pumping its stock back up - announce the investigation of a possible sale... Now weeks later, the CEO has been forced to admit: YELP CEO SAID TO DECIDE AGAINST FINDING A BUYER FOR NOW. We are sure there was just so much demand and that the company had so much organic growth ahead that he decided against it... traders are not amused - Yelp is down 8% and halted.
It appears the sovereign peoples of Europe would not go gently into a Federal States of Europe night. Investors need to prepare for the inevitable political solution: referendums across Europe on the constitution of the Federal States of Europe needed to sustain the Euro. Events this weekend will trigger the search for the democratic legitimacy for the single currency and the centralised constitution it requires... or the demise of the unelected 'king Juncker' and 'queen Lagarde' of the Federal States of Europe.
While Carl Icahn's latest ramblings have brought attention to the 'bubble' in high-yield debt, we would note that the HY market has already dramatically diverged from the ongoing bubble in US equities and as we have been discussing for the past year, this is exactly the pattern we saw in 2008. However there is another aspect of the HY market that is flashing red, High yield debt downgrades are the highest since Lehman and the upgrade / downgrade ratio has tumbled to its lowest since the crisis... The last time this happened, Bernanke unleashed QE3 - are we about to see the same in a massive surprise to markets?
Assuming "growth" will fund all promised pensions and entitlements is magical thinking. We're going to have to do better than indulge our Spoiled Brat Economy mindset because "we wuz promised." What we were promised based on faulty assumptions, faulty projections and wishful thinking no longer matters.
While "Greece doesn't matter," the comments by The IMF that Greece needs its debt restructured and thus the creditors' proposals should be implicitly said "Oxi" to, has spooked US equity markets on this quiet illiquid day...
According to a report prepared prior to capital controls and the banking sector meltdown, any deal that included creditor concessions on fiscal reforms would mean Greece's debt load would have to be written down.
It would appear the most transparent administration ever is in trouble with an 'ally' once again. Following its wrist-slap from France last week, and its previous quasi-admission of spying on Merkel and her senior officials (which we are sure President Obama said would never happen again - better to ask for forgiveness than permission?), The Guardian reports Angela Merkel’s chief of staff has asked the US ambassador for a meeting to discuss the latest reports of alleged US spying on Germany.
Americans Not In The Labor Force Soar By 640,000 To Record 93.6 Million; Participation Rate Drops To 1977 LevelsSubmitted by Tyler Durden on 07/02/2015 - 10:53
The devastation of the US labor force continues.
While Russia has been quiet on the sidelines of the Greco-European austerity-for-cash wrestling death match, offering assistance if it is needed and making new friends, it appears Putin is now getting more vocally involved:
*RUSSIA URGES EU TO RESPECT GREECE'S CHOICE IN REFERENDUM: RIA
*RUSSIAN ENVOY SEES NO THREAT OF GREEK EXIT FROM EURO AREA: RIA
A well-timed show of support for Greece from its potential alternate big brother may just be the ammo that Tspiras needs to reassure the people that they should vote without fear. With 3 days to go, we suspect fearmongering will rise.
Presented without comment.
There are two narratives, according to WSJ's Fed whisperer Jon Hilsenrath, that need to be considered when judging the Fed's next steps. First is, the economy stumbled in Q1 but everything will be awesome going forward (so we should hike rates); and a second newer narrative is the turmoil overseas which could be exaggerated by Fed actions. Hilsenrath hints today that despite the miss in jobs data, it remains above 200,000 and "suggests the U.S. economy finished the first half of the year with a solid foundation to weather turbulence from overseas," giving The Fed room to hike.