DEFINITIONS

Insanity: def. doing the exact same thing over and over believing that the result will change.

Yesterday, Jimmy Rogers was asked whether Bernanke would do what he did today  and his answer was, sur, he wants to keep his job in an Obama second term.  I don't think that is correct.  In announcing the purchase of $40 billion dollars of mortgage securities a month out as far as the eye can see until employment reaches an adequate level demonstrates that he' simply mad as a hatter and that HIS job security has nothing to do with it.  Didn't work the first time, didn't work the second time and it isn't  going to work this time.  But now we are all in sync (tank?); the Euros are throwing money at anybody and so are we.  Everybody gets a hand out!--except maybe the Greeks who today announced that they are going to need a lot more money.  What the hell, why not.  Let's all of us stay right in place until ALL the elections are over, over here and over there.  Seems to me that is what this is all about unless everyone got insane at the same time.  And maybe they did.

The markets loved it of course.  Through the roof, joy unbounding.  30 year add-on auction went swimmingly at well below 3 per cent.  And of course Massimo tracked me down early in the morning crowing again.                                                                                                              



"Charlie, you see what happen today?  How do you say, RIGHT AGAIN!"

"Oh stuff it Massimo, what did you get under 3 for the 3 year."

"Ha, UNDER 3?  Under two fifty.  Capice?  Due et ciquanta!!!"

I made believe we lost the connection but he was right again.  How the Italians do it I will never figure out but this was a real auction and while the coverage wasn't great it was a decline of 200 basis points in yield.  the Spanish come next but that has already been per-sold to the banks.  What kind of a deal they have made with the ECB remains to be seen.  I know there are crazy people out there I'm just beginning to wonder if it's me.