Archive - Oct 27, 2011 - Blog entry

There are several things that you need to know about the eurozone crisis and Wednesday's Summit agreement:

1. It isn't over.
2. The European Monetary Union's (EMU) "architecture" is a failure.
3. They spent too much and can't possibly repay the debt.
4. Banks will need to be bailed out.
5. They will print money.

USDJPY continues to push the high 80s in terms of percentage of traders long. AUDUSD with 59.55% of retail traders short has pushed into the long bias zone.

Consumer confidence indices collapsed to levels not seen in years or even decades. Yet the toughest, most indefatigable creature out there struck again.

Will this (1) Change everything (2) Change nothing or (3) Something in between?

Because we are rarely able to break our broken connections, our Self, our culture and our nation are littered with dysfunctional nonworking relationships that destroy so much more than they should or could, but for our own deliberate inattention.

I don't know who else is going to be stupid enough to say that that Marine, employed Marine mind you, got what he deserved for peaceably standing up for his principles. 

SPX could end the year above 1300

Mortgage principal writedowns may sound like a political panacea, until we consider the effects not only on borrowers, but on banks, and taxpayers, as well...

The suit seeks a civil penalty against MERS of up to $10,000 for each willful violation of the Deceptive Trade Practices Act, as well as restitution to borrowers who were harmed by these violations.

So, the European joke has come full circle. Indebted nations borrow more money to bail out other indebted nations who ask insolvent banks to cut a 50% off deal on the loans that were given to them, but the insolvent banks will then have to raise capital which the will of course borrow from the over-indebted nations whom they just gave money to. Get it? Problem solved - BTMFD!!!

With OVER $46 trillion in assets outstanding, this means that European banks would need to raise $1.77 TRILLION in capital to bring their leverage levels down to 13 to 1.

Finally. With news commentary that involved talk of deadlocks and disagreement on some occasions yesterday. The leaders of the EU have reached an agreement whereby private bond holders of Greek debt will commit to a 50% haircut on those debts, important to note that this is only the case for private sector debt, not total Greek debt.

Retail positioning in USDJPY continues to make new peaks with every day that passes, an all time peak of 87.18% of retail traders being LONG the pair has been reached today.