Zero Hedge - PIMCO Sees UK Rating Downgrade Probability At 80%, Gilts Higher By 100 Bps "Today PIMCO's Scott Mather told Dow Jones his expectation for a rating downgrade of the island nation: "It's just a question of when on the current trajectory, not if. Based on what we know today about the debt trajectory and about the inability to adjust that, I think it's greater than a 50% likelihood for sure. Call it more like 80%."" This should be a huge tell to anyone participating in the market. PIMPCO IMO should be used a an enormous barometer. In this case the pressure is getting lower and a cold front (not the one outside right now) is on the way. Benny's bond bitch has an itchy trigger finger. They have been moving to cash for some time preparing for some apparent impending event. Maybe Mohamed and Bill know whats up and are actually doing something proactive? Referring to a post of mine from last June - Pimco's Gross: Boom Times Are Over
The Market Ticker - Hint To Other Nations: Here's The Bill - Sticking with the global default/potential capitulation theme here. Remember yesterday when I mentioned the finger pointing was beginning as laying the blame to who caused this mess between Ben and Barney? Well, the European house of cards is beginning to show signs of even larger cracks in the foundation. We all know Iceland has been in trouble for some time. Are they about to be hung out to dry if they dont play the game the cabal wants them to? Has it all gotten so silly that if you want to do the right thing and let the banks fail and wipe the slate clean you are now out of the club? Go figure. I guess it is best not to go against the familia.
Washington's Blog - "This Time, It Is Not The Usual Suspects Such As Brazil And Mexico Who Are In the Worst Positions. Instead, It Is the Industrialized Nations" - You catcing on to the theme here today - GLOBAL DESTRUCTION on a massive scale. The dreaded P3 is a coming. "The threat of sovereign defaults is not surprising. In fact, BIS - the world's most prestigious financial agency, nicknamed the "central banks' central bank" - warned in December 2008 that the bailouts and other bank rescue programs were putting nations were transferring risks from private companies to nations." Let's just say it how it really is. They are not putting the problems on the nations but on the tax payers already levered backs. Those assholes are sucking up to special interest groups, bailing out the world, printing money like there is not tomorrow to cover up their greed and lack of regulation and praying that this storm will blow over. Not a chance my friend. Not a chance.
Mish - Showdown in Cleveland: Unions Refuse Nominal Pay Cuts - Changing the theme here, but the point is the same. The lender of last resort has helped every company TBTF and has forgotten something - the trickle down effect. Mish's blog is chock full of pension issues all over the states right now. For some strange reason the states can't seem to pay the bills? The implosion is happening. States are going down this year. wait till the first Muni default. They are coming, trust me. GO is gonna stand for Go Take A Hike, I got's no monies to pay yo bills. (watch this for a few minutes - http://www.usdebtclock.org/ )
naked capitalism - Ambrose Evans-Pritchard: Apocalypse 2010 - You permabears will really appreciate this find, "If things work out badly (and I see the odds of that as reasonably high; China is looking more and more like late 1980s Japan), they will work out very badly, markets are highly connected and if the right dominoes fall, many others go down in fast sequence. So the idea that the amplitude on the downside is likely to be extreme is very plausible. But he has also made a timing as well as a depth call, and sees things unravelling pretty soon."
The Pragmatic Capitalist - WE HAVE BECOME SLAVES TO THE STIMULUS - "Today’s pending home sales data was one more sign of the enormous problems that linger in the real estate market. Despite some near-term signs of stability (courtesy of uncle Sam and his never ending bailout campaign) the long-term structural problems in real estate remain. The government can alter the laws of supply and demand in the short-term with their boom/bust policies, but over the long-term the laws of the free market will win." If you want some insight into the home numbers today and just how bad the situation is, here is a nice primer for you. Hint: it ain't purdy at all.
GL out there and have a great evening.
