1. We are slowly topping out as the wild swings around the 200 MA in the DOW and SPX indicat The crisis in the EU has reached a too big to save Italy with yields reaching the 7% today. At some point the BTP had lost 5% today and for banks like Intesa holding 60 bil ( I guess parts are hedged) it meant 3 bil were wiped out from their equity on 1 day theoretically with a market cap of around 16 bil and that is just one part of their losses in their balance cheat. Just to give you an idea and that is just todays losses one fraction, which is going on for weeks now.
The climax is due around early December than Saturn is exact square the Euro’s natal Venus/ Saturn square. Greece is now just a sideshow which already has shaken the grounds of the Euro but Italy is 6-7 times the size plus Spain and France that will force the ECB to start a QE1 policy with a 1-2 tril balance sheet which Germany opposes so far and is basically against the treaty and German constitution.
Another scenario against the treaty is the story which this idiots leaked they consider a core EU – they should have thought about that from the beginning now its to late no one can exit especially not Germany without causing a financial bloodbath which would let Lehman be a little warm-up event and that would rather be a reason for war. French never would make it alive to such a core EU as their exposure to the PIIGs is to big to survive such a meltdown of assets. Plus no one would dare to pay once the treaty is breached and the whole financial system would collapse. The only they can do is rather follow the FED and start a 2 tril QE program to buy time and pray for a miracle.
German and French officials have discussed plans for a radical overhaul of the European Union that would involve establishing a more integrated and potentially smaller euro zone, EU sources say.
French President Nicolas Sarkozy gave some flavor of his thinking during an address to students in the eastern French city of Strasbourg on Tuesday, when he said a two-speed Europe — the euro zone moving ahead more rapidly than all 27 countries in the EU — was the only model for the future.