EVERYTHING IS FIXED NOW, RIGHT?

                                         Europe In A Nutshell

For you grown-ups out there, this is like watching your kids get a free credit card from their grandparents; not a pretty sight. But not to worry, because everything is now fine in Spain because the smartest-guys-in-the-room have just thrown a check their way to the tune of a “1” with “11” zeroes behind it. Where this money comes from nobody has a clue.

But we are all smart enough to know by now that politicians solve a problem, not by actually solving anything, but by talking about it. Because you see, talking about it to them means it’s on their radar now, and not to worry, we are on it. Uh huh.

The Germans, natch, are expected to lend their AAA credit rating to this hair-brained scheme, but in all things like making sausage and passing out 100 billion Euros, the details are gonna get a bit sloppy. For one, nobody in Germany, except the Pols, are for this. Second, it ain’t gonna matter because on June 17^th, the Greeks say adios to the Euro. And third, as if we need another reason, every other deadbeat sovereign member of the PIIGS gang now wants the same deal as Spain.

“Hey, where’s our hundred billion with no strings attached?”

I swear, it’s enough to make you think the Pols are really in the biz of herding cats. A tough gig no?

                                         Politicians Take Note

Of course, with record spec short positions via the Crimex CME in EURUSD, it’s not really a surprise that we gapped up 100 big ones on the opening in Asia last night. Did you hear the big – WHEEEEW !! – whoosh out of Europe last night? But sadly, with all Ponzi schemes the half-life on this “solution” hasn’t even lasted 12 hours.

And gold? Firmly in control of the Central Planners and weakening as I write.

“But QE3 and QE4; c’mon man, money printing, ya know?”       

Yea, I will make sure and tell that to the prop desk over at JPM that is selling with both hands.”

And so, we find ourselves on countdown to next Tuesday, when we know for sure the Greeks are deadbeats, and the newly emboldened leftists tell Europe to go pound sand with their debt.

 Anybody want to make book on this?

Have a good day everyone.

-vegas

IF YOU’RE NOT NERVOUS YOU SHOULD BE

                                       Good For Traders Too

The real news today isn’t that Europe is toast; geez, we’ve all known that for some time. Only the politicians think that with just one more conference they can fool pretty much all of us find an answer to a non computable problem. Who else would sit around and try to figure out how 2 + 2 = 22 and then with a straight face tell you it is true?

No, the real news is that interest rates around the world are flattening big time. Pick a maturity, it doesn’t make any difference; everything is approaching zero or below.

The ramifications of this are mind blowing. What the Central Planners are attempting, while everyone else flees to safety in Germany, Japan, and U.S. government paper, is forcing you out of cash and into just about anything else. The rationale here is simple: money that lies around getting interest just isn’t productive.

So, while the Cntrl-P button over at the Mariner Eccles building is on full speed ahead and the dollar is getting debased by the minute, as of today your after tax yield on 10 YR. U.S. Gobermint toilet paper is less than 1%. Break out the party hats; you can loan spendaholic deadbeat politicians money for 10 years and get nothing back. Ten years from now what is that money going to be worth?

That this is terribly destructive to those who are near or in retirement isn’t really a concern of the Hope & Change crowd. So, how do Ma & Pa Kettle, besides the Ponzi known as Social Security, earn a return on their life savings and work? Easy Peezee; they don’t.

Don’t worry, we have all kinds of Gobermint benefits for you folks; food stamps [oops, I mean nutritional assistance], section 8 retirement housing, heating & cooling bill help, supplemental Medicaid and/or Medicare, and the list could go on for pages.

Rights enumerated in our Constitution are God given; benefits dolled out by Government are given and taken by the whim of the political elite.

“Hey Grandma, you haven’t eaten your broccoli today! Get with the program or we may just have to cancel your Medicaid. You are undermining the future of your grandchildren by unnecessarily raising health care costs.”

Given the fact that, on the whole, the Amerikan public is dumber than a bag of carrots, this won’t dawn on the masses until their IRA’s and 401k’s are confiscated or forced to buy Gobermint paper. Even then, though, I’m betting more than half will care more about American Idol and college football than the fate of the country.

At every step of the way, government will do whatever is necessary to keep the masses soothed and stupid. That they are intentionally robbing people of their life savings and productivity, right in front of their eyes, should make you nervous.

You are nervous aren’t you?

Have a good day everyone.

-vegas