This page has been archived and commenting is disabled.
Best Day In 5 Months As Europe Soars On Second "Bill Issuance" Catalyst In One Week
While many are celebrating the all-clear again as Spain manages to sell Spanish bills to Spanish banks at a huge risk premium to the last time it did the same, it is perhaps not surprising to hear that this was the biggest gain for the broad European equity market since November. What concerns us most is the absolute schizophrenia that the market is undergoing as the swings in European (and for that matter US) markets is extremely reminiscent of the absolute chaos that reigned last summer as markets suddenly flip-flop +/-2 standard deviations. The sad fact is how quickly our memories (or the algos that surround us) forget just last week we saw the same - exact same - euphoric response to Italy managing to sell short-term Italian bills to Italian banks (again at a significant yield premium to their prior attempt) and the mainstream-media's irrational pump that this is somehow important or noteworthy (remember even Greece managed to sell short-dated bills during the middle of its PSI discussions). European equities are back to pre-NFP levels (same as last week) and credit markets have snapped tighter today (just as they did last week as they got squeezed). This time, however, financials are lagging still and the squeeze in credit is not as hard as overall they remain less ebullient than equities. Sovereign spreads are following the same path as last week also, Italy and Spain yields compressed - though we note that they remain (especially Spain) notably wider than last week's rally. Will the rest of the week play out in a similar manner to last week? As longer-dated auctions and financials weigh heavily on risk sentiment?
European equity markets see biggest gain since November after also seeing biggest fall since November just a few days ago...
And for some comparisons, here is the last week equity vs credit performance...
And European Sovereigns following the same path as last week...
And the day so far in US markets has been - umm - interesting in its schizpohrenia across asset classes also...
Next Step?
Charts: Bloomberg
- 5057 reads
- Printer-friendly version
- Send to friend
- advertisements -






This will not end until Bernanke is sucking Bubba's cock in PRISON.
Leave Bubba out of this. He won the Master's fair and square.
Where is the CONTEXT overlay?
The markets breathe a huge sigh of relief that a sovereign nation was able to sell debt....and thus rally.
What was a benign, non-event in the past has become front and center.
That fact alone should add some perspective on where the financial system is today.
Am I missing something?
Yep, the best 1 day rally in 5 mths.
If its any consolation, I missed it to...
My first thought as well. We're cheering for the expected? And not only cheering, but celebrating it? That's the first sign something's seriously wrong.
And if I've not forgotten, don't banks print their own money so are just buying the bonds with fakeish anyway?
All sold as banks being confident in their purchase. And trust that the only people it fools are those not paying attention. Which means those jacking the market higher today are posed to bail at the earliest sign of stress.
Pass the Fucking Popcorn!
This can all be explained as an analogy:
(Scene: Man standing at hotdog cart placing an order on Broadway. Homeless man gets mugged to his left.)
"LOOK! That homeless man just got kicked in the face! Fuck that's got to hurt. Wait a minute! He's getting up! Alright! Good for him.
Oh darn.... He fell in the gutter again. So... Can I have extra onions on that?
All this means is direction is down. Bet on it. Within the month.
It's doesn't get more irrational than this.
Europe takes off today based on more debt being paid for by more debt.
Primary wave 2 up social mood continues. Primary wave 3 down will be one ugly baby.
http://bullandbearmash.com/index/sp-500/weekly/
why is AAPL not on that chart
POTUS will unleash his economic team on these irrational equity speculators. What will he do when he discovers its his team?
this reminds me of the nazdaq's climb past 5,000...........all the ney sayers were TOO early and the masses started chanting the mantra
its a bull market...peg overnight rates at 5% ben
"how quickly our memories..." ?? Of whom do ye speak??
After programming machines for a quarter century it is most decidedly and painfully obvious they have no 'memory'.
They do what they are 'told'. ...and if the story be told by idiots, well, what's left when 'we' forget?
Also, today is the last day to open and fund IRA before April 17 contribution deadline. They are marking up stocks today to suck in retail investors at inflated levels (and to create "I am missing the rally" perception).
This is the right answer. I wonder if the folks on CNBC would crap their drawers if you got on today and said "Today is the last day to fund IRAs for tax purposes so The Street is marking up prices to sell to the new retail dollars" --- stunned silence
The rally in GM vs Ford this morning betrays the use of Dark Pools by the FED an the WH to sell a political agenda.
This is so painful to watch. Like watching an autistic child repeatedly banging his head against a wall until a big bloody mess
As soon as I read the doom and gloom reports about the impending market crash over the past weekend, I had a feeling they were about to tick upwards. In manipulated markets, it seems one should always do the opposite of what seems to make the most sense.
"The balance sheet of the European Central Bank has expanded by more than 1 trillion dollars over the past nine months. The balance sheet of the European Central Bank is now larger than the entire GDP of Germany and the ECB is now leveraged 36 to 1. So just how far can you stretch the rubberband before it snaps?
Perhaps we are about to find out. The European financial system is leveraged like crazy right now. Even banking systems in countries that you think of as "stable" are leveraged to extremes. For example, major German banks are leveraged 32 to 1, and those banks are holding a massive amount of European sovereign debt.
When Lehman Brothers finally collapsed, it was only leveraged 30 to 1."
http://theeconomiccollapseblog.com/archives/27-statistics-about-the-euro...