Update...

Fed's Emergency Meeting With Primary Dealers Ends

From RBS' O'Donnell:

• NY Fed Meeting Over
• No Contingency Plan For Aug 2 Discussed
• No Decision On Next Week Treasury Auctions
• Talks Focused On 'Market Conditions'

Translation: Tiny Tim has absolutely no idea what he will do on Wednesday, aside from telling B-dog to sell the Tungsten replicas in Fort Knox of course. At $460/ounce that's not bad: still about $100 billion based on today's market prices.

Here Is Boehner's Amended Amended Bill

This the final final version of the Boehner bill which is "supposed" to pass Congress. We haven't read it yet. We doubt anyone else will either.

 

Overnight General Collateral Rate Presented Without Commentary

Submitted by Tyler Durden on 07/29/2011 - 11:51 This is perfectly bullish. As is Tullet Prebon's market of 0.30 bid and 0.21 offer. The whole market has now officially ODed on crazy pills.

Turkey's Entire Armed Forces Resign En Masse

Just to make things a little more interesting, and better for Greece, we have learned of a shocking mass resignation by virtually all of Turkey's armed forces. According to Reuters: "The head of the Turkish armed forces General Isik Kosaner along with the heads of the ground, naval and air forces have resigned, broadcaster CNN Turk reported on Friday. The reason for their resignations was not immediately clear. Tensions between the military and the government of Prime Minister Tayyip Erdogan have been high in recent years and the Supreme Military Council was due to hold a major meeting next week."  We have also learned that the Turkish AKP government is planning to hand over its struggle against the PKK to local police forces. In essence, Turkey is now effectiely defenseless. This is the perfect time for Greece to invade Turkey, and promptly flip it to the Fourth Reich in exchange for some debt forgiveness. There you go: we can spin idiotic things like the best of CNBC too.

Guest Post: This Country Defaulted Long Ago

The final collapse of our credit expansion boom approaches. We have a choice over the next week. We could voluntarily abandon further credit expansion by voting for a Balanced Budget Amendment to the Constitution or we can raise the debt ceiling, pretend to cut spending far in the future, and allow our currency system to experience a catastrophic final collapse. We’ll take what’s behind door #2 Johnny. The vested interests in Washington DC and Wall Street only care about power and wealth. They will never abandon credit expansion. It’s their drug. They must have it. They are addicted to it. They will keep injecting it into our system until they overdose America.

Stocks Reverse Entire Overnight Dump On One Headline

Update 2: Cantor says has votes to pass bill
Update: Sure enough: Boehner tells reported "I am smiling"
As expected earlier, the news of America's economic tumble are completely ignored now and the S&P is well above the levels before the GDP announcement. In fact, following a headline earlier that the GOP is preparing to amend its bill the computers went out in full rampage mode as the quote stuffing chart below demonstrates so vividly, the headline scanners did their job and robot after robot rushed to outrun each other for every available offer. We give this rally a few minutes before some republican says that the Boehner plan will in fact pass in current form, and the robotic buying spree turn into a dumpathon.

Guest Post: Whack-A-Mole

Bernanke and the Fed have to re-evaluate the grade they gave to QE2. How we have such a massive revision in Q1 GDP is hard for me to understand. Seriously, we need to find a way to get better data, but with a 0.4% quarter right in the heart of QE2, it is clear it did nothing to help the real economy. And yes, it is getting old, but I will say it again, the market is not the economy. I am now cutting all my short. I had cut some coming into this week, as I was scared of the rally, but kept enough on that I can't complain too much. I am flat and tempted to go long. We've had a big move, and government resolution is likely to come, but it feels like that is a crowded trade. No one seems really afraid, and everyone seems to expect a bounce. Just because everyone expects it, doesn't make it wrong, but I'm concerned that all the longs will pop out of their holes the second a deal is announced. They will look around for someone to panic and take them out of their positions on the debt ceiling news. Then they will look some more, and then realize that no one is caught short or surprised and they will scurry to get out of their positions. Well, I just convinced myself to go back to putting on a small short.






Observations Of French Markets From A Trader's Perspective: Contagion





On UBS and the FHFA Lawsuit

Posted by: Bruce Krasting

Post date: 07/29/2011 - 08:39

Watch this suit. The big USA financials are going to get hit on the head.