Thursday, July 21, 2016


The DOW broke its winning streak today.  It's sort of like our class secretary.  It seems nobody dies when he's on vacation.  I keep telling him to never return.  I should probably take my own advice.

Mario Draghi did his thing today at the ECB which was really a lot of nothing which is what was expected.  All one could take away from his comments was that he's still not happy with the direction of the European economy but not so displeased as to initiate another rate cut.  Since everything is negative Over There I still keep trying to figure out why the guy wants to do more of what doesn't seem to work but as I keep saying I'm confused about a lot of things.  Oddly, there was no mention of the state of European banking which strikes me as being the numero uno fly in the ointment at the moment.

DeutscheBank suffered another downgrade this week but it is the entire Italian system that is the focus of the international markets, especially Monte de Paschi di Sienna, the world's oldest bank and far and away the most beautiful bank headquarters ever unless you are completely turned off by 15th century Italian architecture.  It's broke as is most of the system but I can't help believing that Sr. Draghi pays it no interest because he knows damn well that it will not be allowed to fail and the only question is who gets stuck with the bill.  Odds on here it will be the taxpayers of Europe (again) but this one is a bit of a closer call.  The problem of course is that while the problem is immediate, so is August and therefore we must recognize that like manana, domani is a word well-understood in Italy. It's going to get solved because Italy is a real country but with the Brits on the way out, getting there will be a delicate dance to insure that no one follows good ol' Albion in a huff.

Speaking of BREXIT, Ms. May met with Angie yesterday and Frankie Holland today to introduce herself and have some preliminary back and forth on the subject.  Except for the standard press releases, there has been little reporting on the talk...probably because there was nothing of substance to report.  This is like the early rounds of a heavyweight fight; jabbing and probing and faking.  We can certainly back-burner this one until 2017.

OK.  Now we are up to date.  With all this excitement maybe I should have stayed away even longer.  But duty called and I responded.  Besides, I couldn't afford the neighborhood.

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