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Futures Red As Reality Returns: Bailout Half-Life Now Laughable

Tyler Durden's picture





 

After opening and surging to up 18 pts last night (to within a tick of its 200DMA), S&P 500 e-mini futures (ES) have faded the entire gain (just as we said last night) with ES now red. European financial credit is wider on the day. EURUSD has given most of its gains back and Italian and Spanish sovereign bond yields/spreads are considerably wider on the day. US major financials have turned red after opening significantly higher. Swiss 2Y rates are at new record lows at -34bps as the USD has strengthened from 0.8% lower to only 0.15% lower now - which is having an incremental impact on Gold, Silver, and Oil - all plunging at the US day session open. So apart from all that, what did the EUR100bn of #Spailout do for all of us?

ES notably given it all up and now red...

Led by major US financials...

European financial credit now wider (lower on chart)...

and broad risk assets are selling off notably more than stocks for now (as correlation picks up systemically)...

and PMs and Oil are suffering as risk assets plunge and USD rises...

Charts: Bloomberg and Capital Context

 


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Mon, 06/11/2012 - 09:59 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

The law of diminishing returns maybe?

Time to quadruple the Viagra dose. Hell, just chug the bottle.

Mon, 06/11/2012 - 10:04 | Link to Comment CPL
CPL's picture

That's the direction it historically goes until governments lock up, break and it turns into Peru as a current example to point to regarding hyperinflation.

 

What a mess.

Mon, 06/11/2012 - 10:18 | Link to Comment Chris Jusset
Chris Jusset's picture

Things will get really nasty when Spain begs for its 2d bailout (in a week or two).

Mon, 06/11/2012 - 10:22 | Link to Comment maxmad
maxmad's picture

As I have been mentioning the "sucker rally" has ended!  Get ready for a blood red finish today!

Mon, 06/11/2012 - 11:12 | Link to Comment Precious
Precious's picture

As history illustrates, what Spain needs is a good navy.

Mon, 06/11/2012 - 11:14 | Link to Comment CPL
CPL's picture

HA!

 

For some reason Black Adder the Second Series pops to mind

Mon, 06/11/2012 - 12:46 | Link to Comment twh99
twh99's picture

The last time Spain had a decent navy was right before they tried to invade England.

Mon, 06/11/2012 - 10:04 | Link to Comment idea_hamster
idea_hamster's picture

But note that the Context model correlation will actually have to fall to close the divergence -- ES is chasing the model value down, but the gap persists.  Somebody can't sell fast enough, huh?  Guess the PPT is out of practice using the "OMFG LIQUIDATE EVERYTHING!" button.

Mon, 06/11/2012 - 10:07 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Buy on the rumour, sell sell sell on the news.

In fact run like hell.

Mon, 06/11/2012 - 10:09 | Link to Comment EscapeKey
EscapeKey's picture

Spain (IBEX) now down over 5% from its intraday peak.

Mon, 06/11/2012 - 10:13 | Link to Comment Chris Jusset
Chris Jusset's picture

The bailout half-life is now measured in fractions of an hour.

Mon, 06/11/2012 - 10:29 | Link to Comment GMadScientist
GMadScientist's picture

"Time to quadruple the Viagra dose. Hell, just chug the bottle."

What'd ya say? Who's there? Huh? Why can't I see?

Mon, 06/11/2012 - 10:01 | Link to Comment orkneylad
orkneylad's picture

Meanwhile in la la land, the BBC runs "Markets welcome Spanish banks rescue deal" story . . . . . oh my sides!

Mon, 06/11/2012 - 10:02 | Link to Comment Dr. Engali
Dr. Engali's picture

What in the hell did they think  lousy 100 billion would do when they need trillions?

Mon, 06/11/2012 - 10:06 | Link to Comment EscapeKey
EscapeKey's picture

Through the magic of leverage no doubt.

Risk? What's that?

Mon, 06/11/2012 - 10:13 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

It's almost like they want things to fail.

/sarc

Mon, 06/11/2012 - 10:02 | Link to Comment MFL8240
MFL8240's picture

Laughable!

Mon, 06/11/2012 - 10:03 | Link to Comment SilverTree
SilverTree's picture

Half-life is a bitch!

Mon, 06/11/2012 - 10:33 | Link to Comment Zero Govt
Zero Govt's picture

Europe and America have been half-dead since 2008..

4 years on central bank drip-feeds, the new normal is nobody can find a pulse (or recovery) because nothing is normal anymore, we're faking an economy on fake wealth

Mon, 06/11/2012 - 10:03 | Link to Comment RobotTrader
RobotTrader's picture

First item thrown overboard?  Gold and Silver

Mon, 06/11/2012 - 10:04 | Link to Comment CPL
CPL's picture

Discounts before currency re-evaluation.

 

Make sure you aren't holding USD or anything paper on the other side.

Mon, 06/11/2012 - 10:05 | Link to Comment Bay of Pigs
Bay of Pigs's picture

in the boating accident...

Mon, 06/11/2012 - 10:06 | Link to Comment EscapeKey
EscapeKey's picture

Oh look it's our resident Netflix expert.

How have you been?

Mon, 06/11/2012 - 10:09 | Link to Comment ruffian
ruffian's picture

3/08

where was GE, BAC, C, CSCO, INTC, MSFT for example?

where was gold?

where are they respectively now?

where do mom and pop wish they had been? 

you're an idiot..........

Mon, 06/11/2012 - 10:09 | Link to Comment Ms. Erable
Ms. Erable's picture

Yes, there have been quite a large number of boating accidents where personally-held PMs have been swept overboard. Damn shame, really.

Mon, 06/11/2012 - 10:17 | Link to Comment eclectic syncretist
eclectic syncretist's picture

You can bet there are many countries, where the government is not run by a central bank, that would love to see a dip in the price of gold.  The game the central banks play is fast becoming all too obvious to them, and they want the insular stability gold offers.

Perhaps the US will begin overestimating it's gold holdings in order to maintain reserve currency status.

Mon, 06/11/2012 - 10:17 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Yup.

Can't have Gold showing strength in the face of the latest Ponzi insanity.

The system is breaking down. Soon enough they will either lose control of the Gold market or they will clamp down and try to suspend Gold trading. Desperate men always do desperate things. Always.

Mon, 06/11/2012 - 10:36 | Link to Comment GMadScientist
GMadScientist's picture

"First item thrown overboard?"

Well it won't be your LULU, that's for sure!

Mon, 06/11/2012 - 11:16 | Link to Comment CPL
CPL's picture

<snort>

 

Hopefully Robo still isn't holding.  I understood the value of buy and hold until dot.com, now the only sensible place to be is be completely disloyal to brands and ticker names

Mon, 06/11/2012 - 10:39 | Link to Comment GCT
GCT's picture

Robo I made a 33% return last year in PM's.  I will keep my PM's thank you. 

Mon, 06/11/2012 - 10:04 | Link to Comment q99x2
q99x2's picture

Ya can't bail out a boat that is in dry dock.

Mon, 06/11/2012 - 10:21 | Link to Comment Nobody For President
Nobody For President's picture

And stickin' feathers in your ass doesn't make you a chicken.

Mon, 06/11/2012 - 11:19 | Link to Comment CPL
CPL's picture

It does make you a Bird Fanboi Furry though.  (Furry: Adults that dress up as animals for personal reasons)

Mon, 06/11/2012 - 10:24 | Link to Comment Zero Govt
Zero Govt's picture

the question is how long can they keep these zombie banks (and Govts) half-dead?

Japan managed 20 years of this economic death on squeeky wheels, bless them!

Mon, 06/11/2012 - 10:04 | Link to Comment CcalSD
CcalSD's picture

Shit! I thought BTFD was Fool Proof?

Mon, 06/11/2012 - 10:06 | Link to Comment asteroids
asteroids's picture

I think the politicians are slowly waking to the reality that the pigmen have truly fucked everyone in sight. Everyone else knows and won't buy it any more.

Mon, 06/11/2012 - 11:20 | Link to Comment CPL
CPL's picture

Politco's are too late in resolving it.  Now it's question of time and will power on how fast they all lose their jobs.

Mon, 06/11/2012 - 10:09 | Link to Comment the not so migh...
the not so mighty maximiza's picture

This is an outrage, an outrage!!!!!!

Mon, 06/11/2012 - 10:09 | Link to Comment dingoj
dingoj's picture

Time I woke up this morning there wasn't any place left to go long, so I stuck with my shorts. It can go either way: the horse is almost dead but they've doped him so much he can't stop running!

Mon, 06/11/2012 - 10:25 | Link to Comment Nobody For President
Nobody For President's picture

With some trepadation, I stayed short over the weekend, hoping reality would intrude.

I'll be damned, looks like reality finally DID intrude, just as I was all primed to go long this morning. I held off just long enough, for once. I might actually make some fucking money today, for a change.

Mon, 06/11/2012 - 10:10 | Link to Comment canardo
canardo's picture

We're fast approaching the point where they can throw all the money they like at it and it won't do a goddamn thing for the economy, except jack up the price of stuff we really need. Funny, today I keep having these mental images of fuses being lit.

Mon, 06/11/2012 - 10:27 | Link to Comment walküre
walküre's picture

We're actually past that certain point you describe.

We crossed the Rubicon a while ago...

Now, everyone is paying attention. Whatever they do is getting scrutinized and people are asking questions. Everyone is interested.

You can't continue to run a scam and expect a return of confidence when everyone learns how it's done and that they're being conned.

Mon, 06/11/2012 - 10:34 | Link to Comment canardo
canardo's picture

You got a point there, people are indeed paying attention now. The difference with just a couple of years ago is immense. Makes life a lot harder for the status quo. The other day as people over here (Holland) were watching the European Championship game against Denmark the Spanish bailout happened and it filtered right through the non-excitement about the game. Many people don't give a toss anymore whether we win or lose the EC, they're worried.

Mon, 06/11/2012 - 10:11 | Link to Comment dizzyfingers
dizzyfingers's picture

Party over, or is there more?

Mon, 06/11/2012 - 10:14 | Link to Comment arkel
arkel's picture

Come on, let's just print and lend the 2.5 trillion Euros already and call it a day.

We know 100 billion is chump change now and we all know the TPTB want to tie that debt to every nation's real assets and collect when the naitons deafult. Can we just get to the last chapter of this story already???

This is all filler.

Mon, 06/11/2012 - 10:15 | Link to Comment Cursive
Cursive's picture

From here on out (until we get under 666), most rallies will be led by short covering.

Mon, 06/11/2012 - 10:20 | Link to Comment Zero Govt
Zero Govt's picture

"Bailout Half-Life Now Laughable"

 chuckle :)

...comensurate with the clowns/comedians running this banking/Govt circus

 

Mon, 06/11/2012 - 10:18 | Link to Comment Peter K
Peter K's picture

What did the Spailout do? Gave us better levels to get into our Risk Off/Reality On trades. ;) Ka Ching:)

Mon, 06/11/2012 - 10:19 | Link to Comment walküre
walküre's picture

Oil did a nice roundtrip overnight. How much oil did the Asian markets buy at $86 tonight?

Mon, 06/11/2012 - 10:19 | Link to Comment HaroldWang
HaroldWang's picture

Buy this dip. No doubt they'll juice this way higher into the close today. Same story different day.

Mon, 06/11/2012 - 10:26 | Link to Comment GMadScientist
GMadScientist's picture

A nostalgic impersonation, but the real HarryWanger would've ascribed it to a recovery in progress.

 

 

 

Mon, 06/11/2012 - 10:28 | Link to Comment walküre
walküre's picture

The real HarryWanger would have told us to buy FB at $25.95 and make millions.

Mon, 06/11/2012 - 10:24 | Link to Comment SmoothCoolSmoke
SmoothCoolSmoke's picture

I see Bankster Gulfstreams full of cash fueling up to head to Greece.  Vote buying booths on every street corner.  If Syriza wins.... it all comes apart at the seams.

Wow.

Mon, 06/11/2012 - 10:25 | Link to Comment brown_hornet
brown_hornet's picture

I think Robo meant the first thing to get dumped overboard is GLD and SLV.

Mon, 06/11/2012 - 10:35 | Link to Comment El Oregonian
El Oregonian's picture

No, he was talking about himself. He's just become so tired of having his ill-conceived thoughts.

Mon, 06/11/2012 - 10:31 | Link to Comment ghostzapper
ghostzapper's picture

"I used ta do a little but a little wouldn't do

so the little got more and more

i just keep trying ta get a little better

said a little better than before

I used ta do a little but a little wouldn't do

so the little got more and more

i just keep trying ta get a little better

said a little better than before

We've been dancin

with Mr. Brownstone

he's been knockin

he won't leave me alone"

 

I have never used drugs but I would imagine that the more you use Mr. Brownstone the more you need to keep that high going. 

Mon, 06/11/2012 - 10:39 | Link to Comment Legolas
Legolas's picture

Market movers and players are increasingly reading ZH.  Keep up the good work, TD !  You rock !

Mon, 06/11/2012 - 10:38 | Link to Comment caimen garou
caimen garou's picture

really you cant bail out a boat that had no proper frame work

Mon, 06/11/2012 - 11:03 | Link to Comment garyw
garyw's picture

Support Ron Paul  He has not given up as they would like you to think.

Mon, 06/11/2012 - 11:05 | Link to Comment orangegeek
orangegeek's picture

Oil was up over $2.50 this morning - now it's down $0.50 so far.

 

Elliot wave save more downside in oil is coming.

 

http://bullandbearmash.com/index/oil/daily/

Mon, 06/11/2012 - 11:17 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

miniscule price movements

as rorms are re-approached from the last phantom melt-up

if this turns into risk0ff i may pee myself!

Mon, 06/11/2012 - 11:19 | Link to Comment Grand Supercycle
Grand Supercycle's picture

Rally Warning from last week:

'Daily chart now gives bullish warning and significant
SPX rally & USDX retracement should commence in a week or so'

http://www.zerohedge.com/news/2012-12-24/market-analysis

Mon, 06/11/2012 - 11:25 | Link to Comment Lord Drek
Lord Drek's picture

Wait...each loan has to be bigger than the one before it so as to achieve the same effect? Sort of like...drugs?

 

 

Nah.

Mon, 06/11/2012 - 11:27 | Link to Comment Dre4dwolf
Dre4dwolf's picture

When you do bailouts back to back the market gains no traction its like flooring the gas on your car when your slipping on ice, your bound to crash.

Mon, 06/11/2012 - 12:00 | Link to Comment financial apoca...
financial apocalyptic contagion's picture

Has it become too easy to predict the market Tyler??

Try your hand at Euro 2012 bro

mad respect for calling this S&P fail

Mon, 06/11/2012 - 12:27 | Link to Comment lolmao500
lolmao500's picture

Silver getting pounded more than everything else, as always.

And as always, the stupid investors are getting out of a bubble (EU bonds) to another bubble (US bonds)... stupidity runs the markets...

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