Wednesday, April 21, 2010

Tomorow May Be A Big Day

Tomorrow may be G day (as in Greece day - or Germany day).

What spooked the market today. Well since CNBS basically never mentioned a word of the big breakdown today or why it was happening (just more solid financial reporting from "the" industry leader), so I naturally went straight to Zero Hedge. We need to pay attention to what's happening there tomorrow.

Failed Bund Auction Having Spillover Effects On Europe was what got the market this afternoon. the supposed strength of the EU had a failed auction. "Eariler today there was an auction of €3 billion 30 Year Bunds that failed to attract enough demand to cover the offer: only €2.752 billion in bids were collected, with just €2.458 was sold. This is the first failed bond auction in Germany in over a year." This following up lots of German rhetoric that Germany's Critical Main Opposition Party Says "No Greek Bailout ".

Next is the fact that the financial heads of the world are descending upon Athens as we speak. this is new. this is big and means that they are going to finally get some result and not three more months of speculation regarding the bailout of the "possibly" bankrupt country. All Shall Be Well - Goldman's Latest Perspectives On Greece "Delegations from the IMF, European Commission and ECB – a reported total of 20 people – are arriving in Athens today to start negotiations on the macro conditionality of the rescue package." You don't just airlift in 20 people like this for nothing. This sounds more like a negotiated bankruptcy than some sore of bailout conglomerate.

Then tomorrow you get the Tomorrow EuroStat Reports European Government Deficits: Expect More Pain For Greece On "Downside Surprise" a report from EuroStat may be as reliable as a report from out BLS or one of the three fine ratings agencies we can fully trust here. Bottom line is in this report there may be some fireworks as clean and never massaged EuroStat data may ignite some reality based fear about the under reported real conditions of the european economy.

Mish has Credit Default Swaps on Greece Hit Record High; IMF Calls Greece Crisis a “Wake-Up Call” on Sovereign-Debt Risks a nice post further emphasizing the problems in Greece and with some of the other PIIGS.

The trouble at home is really getting stirred up. Hell we may not have to vote anyone out of office if the GS suit expands to the true width it deserves, they may all just get kicked out. A Sober Warning To The GOP - And The Democrats is a post from Deninger that is extensive and some of his best work I have seen yet (something about sticking sticks in the eyes of the bad guys must be his thing). I highly suggest you read this well documented and concise post that covers the political fallout that may be worse than the eruption of the volcano Eslkjfglkabfglakdfbglakjfbgaa.

Tomorrow and Thursday have potential to be huge market movers as fallout here politically (the mixed blessing is that our government may become totally dysfunctional) and overseas might just shut down more than air traffic.