Friday, April 17, 2015


And a good thing, too.  There was nothing good anywhere.  The malaise over Greece about which I spoke yesterday finally spilled over into the European equity markets and came straight across the pond Over Here.  At the close the DOW was down 280 which represented a bit of a come-back as it was off over 350 earlier in the day.  None of the numbers were particularly good including profit figures from the first quarter which were  not good to OK but never approaching great except in a few cases.  Blame was immediately placed on the strong dollar which of course totally ignores the fact that the whole financial world was long the dollar and presumably were advising their clients as to what was happening.  Ever hear of a hedge, guys?  When it's one way traffic you can actually make a bob or two to balancing out those translation hits.

In that regard, he's a tip for the future.  The only positive yield at any maturity in the German Bund market was in the 10 year.  Today that yield hit 7 basis points or as a guy on TV put it if you gave the Germans 1,000,000 Euros for ten years, each year you would get a check for 700 euros.  Makes a fella think.  Here we have a complete inability to capture any yield ANYWHERE in fixed income, the ECB continuing to pump up liquidity--which like water finds it's own level--and now global concerns which prey heavily on equity markets, we have a search for return that is becoming frantic.  Look at China:  the relaxing of regulations involving investments in Hong Kong--a tiny little opening to be sure--and a flood comes out of the mainland seeking somewhere, ANYWHERE, to gain a return.  The bubble that has been created there is massive.  If that bursts...

And then there is Greece.  Apparently, the Rock Star urged Il Duce to lean on the Euros in a short little chin wag. yesterday.  That--if you would pardon the phrase--pissed everyone off as I had suggested.  He got no joy of course so today he's meeting with Jacob/Jack who's just dumb enough to say something stupid resulting in a frenzy of speculation that will last perhaps 24 hours.  What has clearly crept into this situation is the inevitability of it all and a growing consensus that if the unthinkable does occur it really wont be so bad except for the people of Greece who didn't have access to Euros over the past few years...i.e. the poor.  As always, they will suffer the most.  I fear a violent end to this sad tale.

Anyway, we have been blessed with our eighth grandchild last week and we are headed out East to pitch in with getting him settled and to further spoil his siblings.  Can't promise to report in every day but check here next Tuesday which will be the first attempt.  I hope there will be something positive.  Return to home base is scheduled for May 5.  Up, up and away!

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