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European Bonds Tumble Most In 15 Months, Stocks Slammed
The one-way street in European peripheral bond yields/spreads... is over. Today saw Italian, Spanish, and Portuguese bond spreads smashed higher by the most in over 15 months. European stock markets all tumbled too with the FTSE-100 down over 3.5% and Portugal down 2.8%. Greece's retroactive tax idea (quickly denied) drove Greek stocks into the red for the year and slammed the new GGB issue lower. Europe's credit markets cratered wider and Europe's VIX burst back over 17.
Ugly day for European stocks and bonds...
Leaving Greek stocks red for the year and the high beta names tumbling...
Worst day for EU bonds in 15 months...
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FTSE 100 down 3.5%? Maybe 0.35%.
FTSE down 0.55% for today
http://data.cnbc.com/quotes/.FTSE
*rushes to the 'safe haven' of Ukranian bonds*
My money's safe because I moved all of it into banks in Cyprus.
Oh, wait...
What do you mean, what happened in Cyprus?
OH MY GOD WHERE'S MY MONEY!!!!!!????????
All hands on deck for free drinks and string quartet! Nevermind that icy water sloshing around...that's our 'liquidity' and it's a good thing.
looks like they finally got the greatest fool to go long PIIGS bonds and US stocks.
The spread between yields in the U.S.S.A. and the E.Z. are finally collapsing?
< shocker >
Fuck, even Santeli saw this one coming.
Wait for it....
The question is which pile of money are they going to steal:
1) From everyone via printing capital and then with inflation.
2) From public pensions again.
3) From private 'safe' savings retirement plans
4) From the remaining operational skelton crew minding all the operational stuff that actually keeps the world functioning.
5) All of the above at the same time and wall paper the theft with media reports that spin theft into 'long term strategic planning'.
Weirdly though the: Drop what they are all doing, push the reset button and start over isn't on the list. For some reason they want to go the long and hard way around the mountain when the obvious is never examined because of their own mental road blocks of greed and over burdened sense of entitlement.
My guess though is they just like inflicting pain on 7+ billion people and it's got less to do with money at this point than it does with the fact they can. Why? Because they are crazy.
Me thinks CONgress will soon enact a national sales (VAT) tax.
Don't hold your breath.
BTFD
Despite Tepper & Rubenstein, I'm patiently waiting for 3:30... rarely ever fails me.
Medium term target for the Euro , 1.50
You can certainly buy a lot of American treasury paper with that kind of purchasing power...
When America blows it, the rest of the world sneezes:
http://bit.ly/QN2u3Z
Nothing Marketwatch publishes really surprises me but one statement made today in an opinion piece was pretty breathtaking. Here's what MW says:
" It’s hard to take seriously the 10-year Treasury yield being in the 2.5% range."
Apparently, bond prices don't jive with their "improving U.S. economy" theme so they tell readers to just ignore the bond markets.
http://www.marketwatch.com/story/economy-improving-faster-than-markets-fed-accept-2014-05-15
Well, since Yellen has to create dollars at a 1:1 ratio to treasury face value she can't exactly bid it lower can she?
It is not like a lot of real buyers are there anymore to add to the bid, just sock-puppets with a Fed hand in their rear-end.
Essentially, the entire year's bond offerings have been monetized.
And I am pretty sure that Mario et al are champing at the bit to be able to do mutual bond monetization with the UST & Fed. When the shroud comes off of that you'll really see fireworks.
The DOW and ES remind me of that "I've fallen and I can't get up" commercial... It's not 3:30 EST yet though.