friday brainstorming

1. Markets are going south on renewed trouble in EU land – Spain with widening protests joins the default ranks soon with protests on austerity measures at already 21 % jobless rate does not promise to be bread and games for the masses. In the meantime Goldman plays both sides of every market with selling lond and short opinions on the Euro.

Markets are nervous and a sell off is just a matter of time as banks prefer the benign situation to place more IPO’s and take-overs which are preferabley done at market highs.



Norway Stops Aid Payments To Greece

Submitted by Tyler Durden on 05/20/2011 09:37 -0400

And here comes the first domino: according to Swiss journal NZZ, the Greek bailout is about to take a turn for the worse. “Norway will first stop all further financial aid payments to the highly indebted Greece. The reason is that Greece does not fulfill its obligations descendants, the Norwegian Foreign Minister Jonas Gahr Store said on Thursday before the Parliament.” And with Norway which is a member of the European Economic Area, and actually one of the few solvent and non-basket case European countries saying let the chips fall where they may, it is just the first. Look for every other country currently on the sidelines vis-a-vis Greece (and just as insolvent) to follow suit as the European experiment falls apart.

Goldman Warns That Spanish Bonds, EUR Poised For Technical Breakdown

Submitted by Tyler Durden on 05/20/2011 08:29 -0400

As if Spain did not have enough to worry about with now daily protests gripping the main cities (the live webcam for the daily festivities in Madrid can be found here), next according to Goldman’s John Noyce not only are Spanish bonds on the verge of a technical breakdown (and yields about to breakout), but due to the very high correlation between the Bund-Spain spread and the inverse EUR, it likely means that should the market start pricing in the Spanish domino, then the EUR, already lagging the move, is about to take out 1.40 rapidly. And with Spanish spreads flying as is over concerns what the Spanish elections on Sunday could mean for the country and the region, we can see something snap in advance of the weekend any minute.


~ by behindthematrix on May 20, 2011.

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