WHAT SCOPE!

I had no idea I was being read in the White House and more importantly by the editorial board of the Wall Street Journal!  Copy cats!  Their leading article today was on Jacob/Jack, killer of businesses.  Oh well, better late than never.  Next time I'll give them a heads up so we can be on the same page.

The White House was busy as well.  Responding to my claim that we were witnessing very little leadership in regard to the economy and the Ebola outbreak, The Leader today announced the appointment of Ron Klain as the Ebola Tsar.  Now Ron Klain goes back a ways.  He was the chief of staff to Al Gore and the guy in charge of the recount (he lost primarily because he limited the counties recounted).  Before that he was Joe Biden's head guy when Uncle Joe was in the Senate.  Klain ran Biden's attack of now-Justice Thomas (he lost).  He ran Uncle Joe's Presidential campaign (he lost) and then became Chief of Staff to Vice President Biden where, among other things, he was the point guy for America's investment in Soylandra (he lost about a billion of the taxpayer's money).  In D.C. circles he is know as being very consist ant and a son-of-a-bitch of a political hack.  With the nation half terrified (probably without much reason) over this Ebola thing, he seems like the perfect choice for the position of Tsar.  He can take some of the pressure off the head of the CDC and allow him to get back to the business of banning the sale of 32 oz. bottles of soft drinks but preserving Americans' rights by allowing them to purchase two 16ozers at the same time as he did in New York.  As I have said, you can't make this stuff up.


Markets rebounded today for absolutely no reason but it was good to see.  This thing is more and more about Europe, gang, and the Euros, bless them, aren't making things any easier.  Relations between Germany on one hand and the entire southern cone led by France and Italy are at the lowest point in years.  The issue?  Fiscal stimulus vs. fiscal conservatism.  Economic restructuring vs. same old, same old.  Don't need me to tell you about it.  However, behind all of this but looming very large is the stress test results which I though were scheduled for next week but apparently I was in error.  They will be soon, however, and Brussels and the EBC are making a big thing of the fact that for the first time there will be a real transparency in the conditions of the financial sector.  Now as I have said the previous stress tests were jokes but I also have to wonder if "real transparency" is a completely good thing given what I feel is the true state of European banking.  I await the result.

Finally, I have been asked why I haven't commented on the AIG trial.  Simple, Don't know what happened, don't understand what is being alleged and don't care.  There are more important things: the World Series starts next week, the Premiership is back in business and there is one BIG game tomorrow in college football.  Let's keep our priorities straight.

WHERE'S THE LOVE?

Man, I got nothin.'  The Leader got up and babbled about nothing for an hour last night giving me no material whatsoever.  Poor Marco Rubio looked like a deer caught in headlights, setup in that awful setting and being forced to demonstrate his agility to remain in the "spot" whilst bending 45 degrees to the side to pick up a bottle of water which does nothing for us old timers who resent agility of any sort.  Where do the Repubs find these idiots who plan these events?

Anyway, I was looking for some really hot stuff from somebody last night to help out and got zip.  The Leader tried to get us to believe that fiscally, all is fine; that the economy is in it's fifth year of turning around; the world is a safer place and God's in his Heaven.  Somehow, I didn't feel much better after he was done.  There was one line in the speech that was important; the United States would begin a dialog with the EU on a trade agreement.  Now if Joe Biden could figure it out he would probably say something like, "This is a big, *&^)^%$ thing!"  but he can't and will not.  It is exactly that, however, as trade between the two continents totalled $800 billion dollars last year.  A big *&^)^%$ thing indeed.  Of course, we should not expect anything to occur in the breath of this administration: too many special interest at work (to be fair, Republicans have their share) and there are real divisions relating to the citizenry of both continents, for example as to genetically altered food that must be overcome in an area vitally important to the U.S.  But the journey begins and it is one that could lead to truly remarkable and beneficial future.  Strike me for saying it but this is far more important than the implementation of Basel III.

But as for financial and banking stuff, the next great hope is the G-20 meeting in Russia this weekend.  Russia in February:  now there's a really good idea.  Of course it will not be too crowded as every Russian with two Rubles to rub together will be somewhere else and because of that, something might get accomplished but probably not.  Currencies will be high on the agenda as they were at the G-7 pre-meeting yesterday where it was unanimously agreed that the manipulation of one's currency to gain advantage was simply not on and the G-7 would demand that the full G-20 agree to that principal...Come to think of it, maybe Russia IS the perfect venue for nonsense like that.  Nothing real has come out of there in 100 years.

And so we labor on in search of material.  Oh, the Bank of England announced today that the inflation target of 2% will continue to be exceeded until at least 2016.  As to what this meant in the great scheme of things remained undiscussed.  I'm beginning to think that even the reported 2 million+ nicker that they are going to pay Mark Carney may not be enough, then again he doesn't get there until July so things may have sorted themselves out by then.  We seem to be sinking deeper into the "phony war" syndrome.  I wonder when the shooting is going to start.

FROM THE RIDICULOUS TO THE RIDICULOUS

What else can one say.  Nikki and Angie came out--hand in hand--I might add, to their press conference today where they announced that they were in complete agreement on a totally impossible plan to regigger the EU by March of next year.  Did what they said make sense?  More so than not I suppose but  there is absolutely no chance for their plan to be accomplished within the time frame.  None.  But the "complete agreement" part resulted in the DOW opening up 145.  So much for the "it's all about Europe" supposed sentiment on Wall Street which if true those two could come out tomorrow and announce that they are in complete agreement that the moon is made out of and equal mixture of Brie and Limburger and we could watch the DOW reach 15,000.  It's nuts.

Not to be outdone S & P followed up with the thought that they might have to downgrade every country in Europe if the big meeting at the end of this week doesn't ratify the joint proposals.  Do any of you get the feeling--like me--that the irrelevancy of the rating agencies looms larger day by day?  I mean, there's a gutsy call and a threat all rolled up into one bundle.  The fact that France is trading around an A+ level rather than the AAA rating currently assigned, seems not to have arrived on S & P's doorstep as of yet.  I'm sure this will galvanize the Heads of State into action.

And to top of this day of stupidity, The Suit's journey across the pond was characterized as The Leader putting "tremendous pressure" on the Europeans and The Suit as "being prepared to show the Europeans how to do it" by Jim Kramer on CNBC today proving that his supply of stupid pills need not yet be renewed  by his friends at Treasury.  Having been thrown the hell of of Europe just over a month ago, I guess The Suit feels with some added advice from his buddy, Jim, he's once again ready for prime time.  This is while the Vice President, good ol' Joe Biden is announcing to the world that the Euros "Know what to do." Mindless.

I got a missive over the weekend from my Really Smart Friend, Larry, that I'll share, in part, with you tomorrow.  It is not happy reading and perhaps a bit too negative in scope from my standpoint, but I confess that his stuff requires multiple reads and I'm not there yet.  Tell you one thing, however.  The Euro closed at 1.33 and change today after the "full agreement."  I don't think either of us would be long.

More tomorrow

IMPATIENCE WITH IMPATIENTS

I planted 10,000 of the damned things today. My back is simply kaput, tot, dead. My hands don't work, my knees are shot and my neck feels like it survived a botched hanging. This is going to be short because I desperately need a wiskey.

Somebody should shoot Greece and put it out of its misery. Poor buggers (oops!) got downgraded again today all the way to single-B...as though anyone cares. Last week, however, amid the talk of the Euros (read Germans) probably having to come up with an extra 30 billion or so Euros on top of the already committed 110 billion, there began the rumbling that Greece would abandon the Euro altogether which caused to currency to rapidly decline against the dollar. That of course was rapidly dismissed by most of the adults involved but the speculation lingered over the weekend and into today. The currency bounced back a bit but the problem that I expect to rise up shortly is the perception that Emperor Europe is walking around without too many clothes on.. I really don't believe that things can improve without growth (as Carter suggested) which means that the boys have a pretty tough call: either they face reality and begin restructuring in earnest or take the pure political route and inflate their way out of the problem. The latter may well be unacceptable to Hans and Brunhilda but remember, this is all about the banks and all about money. Do the bankers get bailed out yet again or does the Volk triumph? Remarkably, I don't have the answer but I do know that this growth thingy better start happening over here or else The Leader and his gang are in for trouble in 2012. There are just so many terrorist leaders out there to whom you can give a double tap and boost the polls.

The Suit and Madame Clinton are in China today along with Jovial Joe Biden which scares the heck out of me whenever they allow him out on his own. Anyway, nothing is certain to come of this so I will leave it to the historian to write about whilst turning to a small but really good piece of news; Poo Bair has decided to call it quits. Now of course this may result in a complete disaster in re the new appointee for the head of the FDIC but I shall try to remain positive in approaching the future. The problem, of course, is the horrific piece of legislation that forms the template for the work of any agency head but ol'Poo and demonstrated such a lack of understanding of the matters at hand that one suspects she could misinterpret the Sermon on the Mount with relative ease. Anyway, she's gone and I just might add another wiskey to my evening's medicinal portion in quiet celebration. I should be in fine fettle about four hours from now.

See ya.

RANDOM THOUGHTS

A few days ago it was Joe Biden, today it's Laura Tyson. Laura Tyson is smart. Joe Biden is...well...Joe Biden. Anyway, they seem to be in agreement that they were really not on target with the state of the economy on January 20 and suggested that another stimulus might be in the offing. The Leader chimed in all the way from Russia with the thought, as here predicted, that it possibly the fault of the previous administration for not having and supplying good data. Aside from a debate as to what the present stimulus package has accomplished, the stock market at least took one look at the thought of another gazillion dollars in deficit spending and said, "Nope," and traded down 161 points on the Dow. The big auction of three year notes, however, went off reasonably well with adequate demand and while the yield was pushed up to 1.51%, some observers had expressed concern that there might have been real trouble brewing. What appears to be brewing is a return of the "flight to quality" syndrome given the growing concern as to the current and future state of the economy. The maturity of this auction appeared to be short enough to attract safe money; whether the longer-dated stuff will fare as well remains to be seen. Clearly, our Chinese friends continue to shorten the maturity profile of their portfolio so the coming months will be a test both for real demand and if that is absent, the willingness of the Fed to continue to monetize to any further extent.

And speaking of our Chinese friends, their movement to move away from the dollar as a reserve currency continued apace. It was reported that the monetary authorities have begun to allow trade settlement to occur in Renminbi as between Hong Kong and the mainland and in certain other locations in southeast Asia. Despite statements that the dollar will remain supreme for the foreseeable future and the smoke-screen concerning Special Drawing Rights (the Chinese are anything but stupid) the ascendence of the Chinese currency is proceeding far more rapidly than anyone anticipated...except for a few of us, that is. Look for a more accommodative attitude on the part of the Chinese in the coming months and perhaps a bi-lateral agreement involving commodities denominated in Renminbi. With whom is immaterial.

Finally, it would appear that Michael Jackson is still deceased and will remain in that state. Hopefully, he is at peace.

Tomorrow, thoughts on the G8 conference and whatever else might pop up.