Wednesday, October 24, 2012


--There is a famous film of the great American football coach, Vince Lombardi, looking out across the field and asking, "What the hell is going on out there?"  At 9:00 am this morning the Greeks let leak that they had received a two year extension by the Troika for the meeting of their financial targets and their-agreed fiscal plan.  About 11:00 am Reuters, the original publisher of the leak, began to question its veracity.  By 5:00 pm the Greeks were denying that any extension had been granted and the Troika indicated that Plan Greece had not been accepted.  I can just hear Vince yelling, "What the hell is going on out there?"  Beats the hell out of me, Coach.

--Continuing to be in the role of the uninvited guest, David Cameron today announced that the UK would veto the proposed increase in the EU budget.  What! A mere 11% increase in the amount of money that a bunch of professional politicians in Brussels could spend on themselves?  Surely you jest!...Apparently not as the ol' boy was joined by the Dutch.  And one wonders why things don't get done.

--Mario Draghi spent a number of hours trying to convince the Bundestag that spending all the money in the world to bail out everyone and everything in Euroland will not be inflationary in the long run.  Little Paulie Krugman could be heard cheering in New York but apparently a number of German politicians wandered out of the get-together in a move interpreted as they not being convinced.

--As more and more people begin to look at the true state of the Spanish banking system, there appears to be a growing concensus that what the government has said is need to fix it...i.e. in recapitalization...may be a number whose basis is firmly planted in thin air.  And where have you heard that before I humbly ask?  Slowly yields rise once again and I suspect will continue to do so.

--But there is a saving grace.  I have it on good authority that someone high in the German Finance ministry let it slip that there are times when the fiscal detectives must be aware that their efforts at finding a solution may be subject to political realities and timing.  When are those elections? Next October?  You mean we have another year of this nonsense?   What the hell is going on out there?

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