John Taylor: "The Euro Is In A Death Struggle"

FX Concepts' John Taylor has not had a good year. A month ago, talking to Bloomberg he admitted that "What’s really frustrating is that we’re supposed to do well in a lousy world market,” said John Taylor, the founder of New York-based FX Concepts LLC, the world’s largest currency hedge fund. Taylor said in an Oct. 19 interview in London that he has lost 12 percent this year and assets under management fell to $5 billion from as much as $8 billion. "We’re doing very badly." Naturally that is to be expected: after his banner year last year, and doing what is logical in 2011, it is not surprising that he did not anticipate the level of central bank involvement, and the resulting surge of the EURUSD in the past month. Either way, he very bearish stance on the EUR will soon be vindicated. In a brand news interview with Bloomberg he says that the the Euro has entered a "death struggle" and that it is "really worse than I could have dreamed it being." Logically, to every seller there is a buyer. To wit: "What’s stupid is that the ECB is holding it up.  Why are they holding up the euro? One of the problems, besides the ECB, is the banks are shrinking, and the banks are selling all of their offshore assets and bringing them back to Europe.  That means in fact there is a persistent buyer of euros and it’s their own financial institutions." All this, and more in the full interview below with transcript.

Europe's Grand Plan - 3 Strikes And You're All In

The "Grand Plan" on October 27th had 3 prongs - IIF-led PSI for Greece, Bank Recaps, and the levered EFSF. They have failed on each of their major initiatives, but now the market is comfortable that they will get ECB to "print" and that some form of "policy changes" will be fast tracked. Virtually all the analysis ends with print and treaties and we will be fine. We doubt that we get those yet, and we remain dubious that they will work and won't unleash new and bigger problems.

Commitment of Traders reports confirms effects of Risk Aversion trades

Trader Dan at Trader Dan's Market Views - 29 minutes ago

This past week's COT report was delayed until Monday (yesterday) on account of the Thanksgiving holiday. It does however confirm the market price action in both gold and silver which are currently stuck in no-man's land experiencing range bound trade with firm resistance on rallies and good support on dips. Simply put - speculative interest in the metals has dampened off considerably as more and more traders/funds move to a cash position and lower their overall exposure to the commodity sector in general (risk assets). This is particularly evident among the general public, the small... more » 

 

 

Junior Gold Miners Still Showing Distribution

Eric De Groot at Eric De Groot - 1 hour ago

The junior gold stocks continue to show signs of distribution over the short-term. Signs of distribution do not always precede a mark down phase, so do not needlessly panic here. While the long-term trend remains up, it is becoming more violent as the sovereign debt crisis metastasizes throughout the global financial system. Investors able to exercise flexibility of thought consistent with the... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] 

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Just When You Think It CAN'T Get Uglier Out There...

Dave in Denver at The Golden Truth - 1 hour ago

Before I get started on what I had intended to post, I want to present two items of acute interest. First, I hope everyone - Democrat or Republican - is aware of just how tight Jon Corine is with President Obama and the Obama White House insiders: LINK Not that it will matter for the Presidential race because the leading Republican candidates are thoroughly unelectable, but I sincerely hope that the conservative media makes Obama wear Jon Corzine the way that Republicans made Michael Dukakis wear Willy Horton in the 1988 Presidential race vs. George H. Bush (everyone remember that... more » 

 

 

He's Baaaaaaaaaaack

The Man. The Myth. The Womanizing Legend.

• BERLUSCONI SAYS HE WON'T LEAVE ITALY IN THE HANDS OF THE `LEFT'

 

 

Goldman's Sigma X Spot On Once Again: Predicts Imminent UK Contagion

Last Wednesday we put up the following blurb: "Five months ago, when Italian yields were still tame in the 3% ballpark, and not 7% where they are today, we suggested that based on trading patterns and overall volume in Goldman's dark pool, Italy may be about to experience a "Greek episode." Days later we were proven right as Italian yields and spreads started their relentless move wider, with only those who had access to Sigma X being able to get an advance whiff of what was about to happen. Well today we are happy to report that the German diversion may have worked: the truth is that nobody appears to care about Germany. Instead what everyone does seem to care about, is the nation with the greatest combined debt (government, corporate and household) to GDP in the world. Yup. The UK." Following that, a quick Twitter update from this morning indicated something was again going on with the UK from the perspective of the world's most connected insiders: "UK's LLOYDS and RBS top of most active on Sigma X this morning." Sure enough, here's Fitch with what may well be a precursor to the bond vigilantes finally focusing their attention on the last, latest and greatest AAA credit.

• FITCH: UK GOVT MAY BE MOST INDEBTED OF AAA SOVEREIGNS EX U.S. -BBG
  
• FITCH: NEW UK FISCAL VIEWS 'SIGNIFICANT DETERIORATION' VS MARCH - BBG
  
• And the punchline: "the capacity of UK public finances to absorb adverse economic and financial shocks that would result in yet higher public debt while retaining its 'AAA' status has largely been exhausted"

And cue the imminent downgrade rumors - and ensuing safe-haven outflows to TSYs.

Two Fed Members Speak, Contradict Each Other

It is not only Europe who has perfected the art of baffling everyone with intolerable and relentless bullshit. Fed members have it down pat too. Case in point, just presented prepared remarks by Fed uber-dove and vice chair Janet Yellen and hawk and Atlanta Fed president (who becomes eligible to vote in 2012) Dennis Lockhart. Here are the money quotes via Bloomberg:

• YELLEN SAYS `SCOPE REMAINS' FOR ADDITIONAL FED EASING
• YELLEN SEES `STRONG CASE' FOR POLICIES TO BOOST U.S. HOUSING

And minutes later:

• FED'S LOCKHART `SKEPTICAL' MORE BOND-BUYING WILL HELP ECONOMY
• LOCKHART SAYS ASSET PURCHASES NOT A `POTENT POLICY OPTION'

Mmmk.

With Bank Of America On The Verge Of Breaching $5.00, Our Question Of The Day Is...

... how many of the top 50 holders presented below, will be forced to sell once we get a 4 handle?




You Cannot Build a Financial System on Rumors and Lies

Posted by: Phoenix Capital...

Post date: 11/29/2011 - 11:43

You cannot build a financial system on lies. It simply doesn’t work. All it does is breed distrust and resentment. And as any businessperson can tell you, without trust business cannot work.

Thank You

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