"Who knew that the 24th electoral district in Chicago actually sits in Northwest Madrid?" That is how Art Cashin concludes his tangent into the president's pre-election tactics, which now apparently involve begging heads of sovereigns to accept bailouts from other sovereigns (coughgermanycough) just to boost one's reelection chances. Why? Because the one thing that could send the S&P ripping higher, however briefly, is what we have been discussing for the past week: namely the market finally getting the paradoxical catalyst that the market has already priced in - Spain admitting it is broke. And why would Obama be focused on a rising S&P, fiscal cliff after the election notwithstanding? The chart below should explain it.
Anyway, here's Art via UBS:
Good Afternoon Sir! I'm Calling About The Election – More than a few eyebrows were raised by a single headline that flashed by sometime around mid-day. The headline read something like:
"President speaks by phone with Spain's Rajoy"
Traders saw that as a president very concerned that Europe holds the key to his re-election. Here, courtesy of Politico's Morning Money is the White House release on the topic:
President Obama spoke with Spain's President Mariano Rajoy earlier today as part of his ongoing discussions with European leaders about the eurozone economy. President Obama acknowledged the difficult challenges that the Spanish people are facing, and reiterated his support for President Rajoy's efforts to get Spain's economy back on track.
Traders were sure the conversation was much more animated than that. It was a plea/demand that Rajoy formally request a bailout lest the rescue effort stumble and a new financial crisis erupts and ends President Obama's chances.
Who knew that the 24th electoral district in Chicago actually sits in Northwest Madrid.