FIRST YOU SAY YOU WILL, THEN YOU WONT...

THEN YOU SAY YOU DO AND THEN YOU DON'T... Rather racy lyrics for their time and so fitting for today's headlines. First, the Greeks had a deal...then they didn't...then they had agreement...but no terms discussed...it was a guarantee...no,it was...Ah forget it. Translation; methinks the Germans agreed that they would save Euroland as we know it but nobody like the terms they were discussing. So everybody goes home to figure out how to eat humble pie and the talking heads can remain all atwitter not really having a clue at what is going on.

I still think it's going to be some form of guarantee but another way to do it is simply throw a bid in under any new Greek refinancing which will, for the professional underwriters at least, supply them with known distribution whilst maintaining the fiction that the Greeks were able to refinance themselves. Sovereigns like that. To be seen being bailed out by another country--especially one by whom you were occupied well within human memory is not good for the political spirit. In the mean time the government is making all the right noises as to fiscal policy and the unions are going nuts which is always a good sign. In the end, there is always the threat of the cursed IMF getting involved and NOBODY wants that I suspect unless all the players have lost their reason. Anyway, it now seems certain that a deal will be done so at this point what sort of a deal it is is really no more than of academic interest.

More interesting is the possible knock-on effect or as we like to say in the trade, will there be "contagion" among the other players in the region to wit, Spain, Portugal and Italy? Could be. If Greece gets a good deal, why not me? Know what I mean, mate? That remains to be seen. Spain and Italy are REAL countries as opposed to Greece which is only a real country. Of course, Italy has been playing this game since Julius Caesar was a corporal but we shall have to wait and see. What the heck, Al Gore is lost, the country is frozen solid and there's nothing to do in the mid west til' March Madness. There is one thing to think about, however, that I find fascinating. The Euro

The conventional wisdom is that whatever happens the result is not going to be good for the Euro. That's probably correct. So my favorite question arises, Cui Bono...who benefits? Obviously, the first thing that comes to mind is the dollar. That's every-bodies' trade as the Euro has fallen--nay, dropped like a rock---from over 1.60 to 1.37 almost overnight. USA! USA! Ah, just hold on a minute. Remember what The Leader blurted out during the State of the Union? We're going to triple exports to put our house back in order (I wonder why he didn't say TEN times over, it's equally stupid and sounds better)? Not with the Euro around 1.20 we're not or anything like that. In fact we will probably get our butt kicked all around the globe beginning with...think about it...still thinking...you got it! Germany. So I said to myself, Self, ol' Fritz just might come out of this one smelling like a rose. Their enormous export engine which just lost first place to the Yellow Horde now powered by a more than competitive currency while the Yuan is locked to a rising dollar? You could sell tickets to watch that one. 'Of course I'm making it sound simple (haven't spoken with my smart buddy Larry yet) but this thing has more implications to it that you read about in the paper. And you heard it here first. As for The Leader and his band of merry men...YOU'RE UNDECIDED NOW SO WADDA YA GONNA DO?

More tomorrow. I'm having fun with this.