June 2012 MarketToday
Research for Online Investors

• Market in Correction
  
  The market has fallen through the 200-day moving average and is now officially in "correction" mode. Irish voters approved the European Fiscal Treaty yesterday.
• More Europe More Pain
  
  Spain need bailout money to rescue their banks. Germany wants the Spanish government to request a bailout then use the funds to recapitalize their banks. Germany is ready to endorse a tighter european fiscal union, but it involves giving up much sovereignty
• Fatal Hubris
  
  Spanish banks need $50 billion dollars to recapitalize them. The government is worried about borrowing one or two billion on Thursday, but won't apply for a bailout because they don't want to give up power to the euozone.
• Hard Lessons
  
  The French just lowered the retirement age for some workers to 60 years old. They are running a budget deficit but Hollande is a socialist and will spend other peoples money until he cannot.
• Money Gets Cheaper
  
  China lowered depositor interest to 3.25% this morning. This was the first cut since 2008. Spain sold debt this monring at 6.04% on ten-year bonds. The Bank of England held rates steady at 0.5%. Bernanke doesn't throw us a fig leaf in congressional testimony.
• Salting the Well
  
  Who is spreading rumors the Eurozone is going to announce a monetary program this weekend? Geithner is encouraging european leaders to enact a European TARP program.
• Bailout Half Life
  
  Spain received a committment for $120 billion dollar bailout for their banks over the weekend. Markets were up and their interest rates down for a short time, then reversed. The half-life of a bailout just went to 12 hours!
• $4.136 trillion x 0 = 0.00
  
  Central Banks have printed $4.136 trillion dollars. It is sitting in banks and treasury bonds. Without velocity of money, there is no inflation, there is no GDP growth effect. Here we sit.
• Countdown for Greece
  
  We are counting down the days to the Greek election. New Democracy appears to be gaining the upper hand which means Greece will stay in the Eurozone.
• Pee Wee Herman Market
  
  The market is rallying on a rumor a Grand Bargain is in the offing to backstop eurozone banks. It will be announced over the weekend. Buyers are following the leader, it is Pee Wee Herman
• Socialize the Losses!
  
  Investors are giddy with excitement about Central Banks willingness to make liquidity available next week. It doesn't matter. Liquidity does not make a bank solvent. This is why France wants the ECB to deal directly with banks.
• Headline Risk Overload
  
  This week the G-20 is meeting, also the FOMC and P5+1 negotiators with Iran in Moscow.
• Central Bank Rally?
  
  Obama can't convince Putin to join the U.S. opposing Syria's Assad. Nuclear negotiations with Iran end without resoultion. The FOMC announces tomorrow, no QE and the maket will be disappointed. Merkel resists paying for other county's excesses.
• Moment of Truth
  
  The FOMC statement will be released today at 12:30 eastern time. Some traders expect a new round of QE, some expect Operation Twist to be continued. We expect the market to be disappointed. European Leaders meet next week in Brussels. More disappointment on the horizon.
• Goldman Confirms Downtrend
  
  Goldman Sachs issues a warning to short the market to 1285. Greece wants to renegotiate the terms of their bailout...and get another $25 billion commitment. France, Italy and Spain want the ESM to buy sovereign bonds.
• Running Out of Money
  
  The eurozone is running out of money to pay bills. Every government, except Germany, has larger liabilities than they can afford going forward. Eventually the ECB will be forced to create euros.
• Get It Over With
  
  Greece, Spain, Italy and France want more money without any fiscal pain. Germany, the Netherlands and a few other countries are standing guard at the eurozone money gates. It is time to say "NO" and let the weak countries go bankrupt.
• Check-Mate?
  
  European Leaders are trying to paint Angela Merkel into a corner, to check mate her, we don't think they will be successful.
• Precious Metals = Trade
  
  We named Gold our Trade of Year for 2012. It is a trade not an investment. Why isn't it higher?
• Industrial Action
  
  European Leaders meet today and tomorrow in Brussels. Italy, Spain and France want the ECB to intervene in bond markets to lower interest rates. No joy here. The Supreme Court upholds Obamacare.
• Devil in the Details
  
  Bloomberg cannot be acessed in China today because they exposed the riches accumulated by Xi Jinping's family. He could be the next president of China. Germany made concessions in Brussels on the use of EFSF and ESM funds

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