friday brainstorming

1. Markets turned back down with even a bigger Obama jobs plan today as rumors that Greece will default this weekend are spreading – which I do not see yet happening but Q4 is a likely time. Crucial next week is another test of the 1144 SPX but one should probably focus on watching the DAX as the best indicator as it will make a low between 5050-5150 and rally from that level for a few weeks. The most likely point of time is around second half of next week. Also US financials are close to temporary lows as JPM which has  a weekly 13 but not done yet we will see it drop to the 31 area level before a stronger rebound should follow. The likelyhood of a QE3 around 21st is a good bet it seems short term. Medium term we will go far lower after the initial effect fades off and more importantly the very bearish sentiment moderates and some HFs get screwed how seem to be very bearish ( most in 4 years).

excerpt

Market Chatter Of Greek Default Over The Weekend

Submitted by Tyler Durden on 09/09/2011 – 09:00Bond CDS default European Central Bank Lloyds RBS Reuters United Kingdom

This email originated by Bloomberg’s TJ Marta currently making the rounds and sending European CDS spreads to the moon:

From colleague: trader friend just hit me with the following: There is “Chatter” in the market of a Greek Default this Weekend – and their CDS is over 400 wider…  Soc Gen is off 7% on exposure – German CDS more expensive than UK;s – despite the ballooning in the CDS prices for Lloyds and RBS.

 

Finally the Chinese Euro buying is fading away as the EU nears a collapse as the Euro tests the strong 1.37 support but we are heading lower medium term. Strange things as we have an exodus of German members from the ECB again a member quit far before his term ended – might be he was hired by an Investment bank as well 🙂 – but a hunch tells me something is in the pipeline soon

excerpt

Today, Jürgen Stark, Member of the Executive Board and Governing Council of the European Central Bank (ECB), informed President Jean-Claude Trichet that, for personal reasons, he will resign from his position prior to the end of his term of office on 31 May 2014. 

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~ by behindthematrix on September 9, 2011.

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