Bloomberg Reports That Greek Private Creditor Deal Near, At 32 Cent Recovery, According To Hedge Fund Involved

Last year it was bank posturing, coupled with Germany and the rest of the Eurocore countries, when it comes to Greece. Now it is the hedge funds. Bloomberg has reported that the Greek private creditors have "reached a deal" with Greece on existing debt which "would give creditors 32 cents per euro", or a 32% recovery according to Marathon Asset Mgmt CEO Bruce Richards, who until recently was a bondholder, but recently has been rumored to have dumped his holdings, which makes one wonder why or how he is talking for the creditor committee. Of course, with Greece now a purely bankruptcy play, we expect various ad hoc splinter "committees" to emerge, coupled with an equity committee as well (yes yes, we jest). Bloomberg reports also that Richards is "highly confident" a deal will get done. Nonetheless, the Marathon CEO expects Greece won’t make the €14.5 billion ($18.5billion) bond repayment scheduled for March 20. However, he does see a deal with creditors to be in place before then. For now the Greek government has declined to comment. We fully expect the IIF's Dalara to hit the airwaves shortly and to make it all too clear that the implied 68% haircut is sheer lunacy. Naturally, should this deal come to happen, we can't possibly see how Portugal, Spain or Italy would then sabotage their economies just so they too can enjoy 68% NPV haircuts on their bonds. Finally, even if Marathon likes the deal, all it takes is for one hedge fund hold out to necessitate the application of Collective Action Clauses which would blow the deal apart, create a two-tiered market, and effectively create the perception that the deal was coercive.

Morgan Stanley Quantifies The Probability Of A Global "Muddle Through": 37%

When it comes to attempts at predicting the future, it often appears that the most desirable outcome by everyone involved (particularly those from the status quo, which means financial institutions and media) is that of the "muddle through" which is some mythical condition in which nothing really happens, the global economy neither grows, nor implodes, and it broadly one of little excitement and volatility. While we fail to see how one can call the unprecedented market vol of the past 6 months anything even remotely resembling a muddle through, the recent quiet in the stock market, punctuated by a relentless low volume melt up has once again set market participants' minds at ease that in the absence of 30> VIX days, things may be back to "Goldilocks" days and the muddle through is once again within reach. So while the default fallback was assumed by most to be virtually assured, nobody had actually tried to map out the various outcome possibilities for the global economy. Until today, when Morgan Stanley's most recent addition, former Fed member Vince Reinhart, better known for proposing the Fed's selling of Treasury Puts to the market as a means of keeping rates at bay, together with Adam Parker, have put together a 3x3 matrix charting out the intersections between the US and European economic outcomes. Here is how Parker and Reinhart see the possibility of a global goldilocks outcome, and specifically those who position themselves with expectations of this being the default outcome: "A “muddle through” positioning is potentially dangerous: Our main message is that the muddle-through scenario might be the most plausible alternative, but its joint occurrence in the US and Europe is less likely than the result of a coin toss. Uncertainty is bad for multiples." Specifically - it is 37% (with roughly 3 significant digits of precision). That said, as was reported here early in the year, Morgan Stanley is one of the very few banks which expects an actual market decline in 2012, so bear that in mind as you read the following matrix-based analysis. Because at the end of the day everyone has an agenda.

Police, Military – Was Your Oath Sincere?

Presenting The Big Mac Index Infographic

With ever more Americans boldly crossing into the obesity zone, where so many have gone before, it is only fitting that the topic of today's infographic du jour is the Big Mac index: the world's intercontinental standard of purchase price parity.

Unsolvable Insolvency

by Bill Bonner, DailyReckoning.com:
Time and time again, Europe solves its debt problems… and every time they don’t get solved at all.
Italian bond yields are edging back up. And Greece is negotiating a default. They want to avoid a naked, noisy default…so they are dressing it up as “voluntary” or ‘soft.’ But they can’t disguise the fact that Greece has bills it can’t pay. On the 20th of March it needs to come up with 14.4 billion euros, followed by billions more in the months following. That is more than 6% of national GDP. It would be as though the US had to pay a trillion dollars.
Where’s the money to come from? The European Central Bank? The IMF? The Germans? Maybe. But little by little, even the fixers are beginning to realize that this is a problem than can’t be fixed with Band-Aids and bailouts. Greece has too much debt. About 100 billion euros worth of it will have to go away or the country will never be solvent.
Read More @ DailyReckoning.com

Greek Default Imminent probably March 20,2012/LTRO next auction 1 trillion euros

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 1 hour ago

Good evening Ladies and Gentlemen: Gold and silver had stellar days with gold rising by $24.80 to $1655.20 and silver finishing the day up by 36 cents to $30.11. There is still no doubt that the bankers are controlling the paper silver/gold market. Let's proceed over to the comex and assess trading there today with respect to open interest, inventory movements and amounts of precious metals

Priorities Straight! Ron Paul Plans D.C. Detour to Vote Against Debt Increase

By Stephen Dinan, WashingtonTimes.com:
Rep. Ron Paul will drop off the campaign trail in South Carolina on Wednesday and fly back to Washington to cast a vote against raising the debt ceiling, his campaign said Tuesday.
Jesse Benton, Mr. Paul’s campaign manager, said that vote was a big enough reason to change plans, which had called for them to be in South Carolina campaigning ahead of Saturday’s primary here.
Mr. Obama said late last month the federal government was once again close to breaching the legal limit on how much it can borrow, and he requested Congress raise the ceiling again. Opponents would need to pass a resolution disapproving of the increase and have it signed into law, or else override a presidential veto, to bloc the increase — which is highly unlikely.
Read More @ WashingtonTimes.com

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Sprott Physical Silver Trust PSLV Brings Out Its Follow On Offering

 

 

 Gold & Silver Banker-Cartel Prolonged Price Suppression Has Set the Foundation for an Explosive Move Higher in 2012

Posted by : smartknowledgeu

Post date: 01/17/2012 - 07:54

Recently, public interest in gold and silver and gold/silver mining stocks has been at multi-year lows. And that is a super bullish contrarian indicator. 

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Gold Daily and Silver Weekly Charts

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SP 500 and NDX Futures Daily Charts - Manhattan Melodrama

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SP Futures Intraday

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Are You Ready?

Eric De Groot at Eric De Groot - 5 hours ago

The talking heads talk so much their teeth fracture from the constant chattering. Let's be clear, capitalism is not "in crisis". Poor decision making from leadership to citizen has brought debts to unsustainable levels across the Western world (see charts below). The market's solution will be to purge the bad debt through default or monetization, but no one from leadership to citizen wants it to... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]

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Wells Fargo Earnings?

Dave in Denver at The Golden Truth - 6 hours ago

*U.S. debt and deficits are running over $1 trillion per annum and amount to over 700% of Federal revenue. And just last week, we learned that the monthly budget deficit climbed to $85.97 billion in December, from $78.13 billion in the same month a year earlier. The only relief from such debt will be a default on the part of the United States. A sovereign U.S. default would be pernicious for the dollar and massively bullish for gold. -* Michael Pento, on King World News I see Wells Fargo's earnings report was greeted by much fanfare by Bubblevision and the mass media slavishly... more » 

Guest Post: Returning to Simplicity (Whether We Want to or Not)

The modern world depends on economic growth to function properly. And throughout the living memory of every human on earth today, technology has continually developed to extract more and more raw material from the environment to power that growth. This has produced a faithful belief among the public that has helped to blur the lines between human innovation and limited natural resources. Technology does not create resources, though it does embody our ability to access resources. When the two are operating smoothly in tandem, society mistakes one for the other. This has created a new and very modern problem -- a misplaced trust in technology to consistently fulfill our economic needs. What happens once key resources become so dilute that technology, by itself, can no longer meet our growth needs?  We may be about to find out.

Jerry Yang Quits Yahoo Again, This Time For Good

Jerry Yang, who previously quit as YHOO CEO, has just announced his final resignation as Chairman of the company, in what appears to be a (pyrric) victory for Dan Loeb, who made the ouster of Yang his number one goal in life. Well, Yang is now gone, and Loeb can proceed with the value maximing exercise. We have a very distinct feeling Loeb will be rather disappointed with what he discovers. It may be even more difficult for Loeb to remind the general population that Yahoo is not Friendster, and is actually still in existence. Of course, the pain trade is fading all the MSFT for YHOO rumors which will start hitting the tape every day at 9:45am like clockwork. Stock was up as much as 5% after hours. Now fading.

Financials Lead Stocks Down As Futures Volume Stays High

Friday was the most active day in ES (the e-mini S&P 500 futures contract) since 12/16 and today saw volume once again surge in the futures market as it tested 1300 for the first time since 7/28. However, NYSE stock volume (which managed a very late-day spurt on Friday) was dismal once again today (for instance -25% from Friday with 3 minutes to go) with another extremely late jump taking it back to 'normal' for the year so far (but still dramatically low compared to previous year 'norms'). Stocks rallied on China GDP and an optically decent Spanish auction but as we moved into the European close, risk started to leak off and accelerated in the afternoon as IMF headlines, LTRO rumors, and IIF/PSI chatter hit though more expansive ECB rumors seemed to stall losses at last night's ES re-open levels. ES is down very marginally from Friday's late-day ramp close and credit outperformed today (though HYG hung in with stock's weakness) as financials underperformed. The majors were the worst performers with Citi and BofA giving decent amount of YTD gains back. EUR stabilized post-Europe (after selling off into their close) with the USD (DXY) down 0.4% from Friday and GBP underperforming. In the face of the USD stability this afternoon, commodities were mixed with Oil spiking back over $100 (as NatGas was crushed), Copper leaking off but holding gains 2%-plus gains from Friday (China), as Silver and Gold lost their earlier gains (3% and 1.5% at best) to end around 0.75-1% better from Friday's close (still a double on USD weakness). Treasuries closed marginally lower in yield from Friday (1bps max) but were 4-5bps lower in yield from around the European close (as 2s10s30s slid also). Stocks closed well below broad risk assets as FX carry never really joined the derisking craze and oil's strength seemed divergent for now.

Sen. Tom Davis: Why I Support Ron Paul

Peter Grandich Sees Where The Markets Are Headed And He’s Going For The Gold – 01-17-2012

from The Financial Survival Network:
Peter Grandich joins us for the first time today to discuss what’s going on with oil & gas, precious metals, and the stock market. Peter has been writing his newsletter for many years, and his biggest present concern is US debt. He describes the US as being in an eye of the storm–we’ve had the first wave and the back end, which is always worse, is rapidly approaching. Peter refers to the financial professional community as the dont worry be happy crowd. He describes the constant industry refrain that, “Stocks and bonds are always a buy,” is just mainstream media propaganda.
The US has so much debt, that there’s no foreseeable production of cash flow to service the interest rate, let alone pay down principle. Peter says the inevitable result will be a combination of three things: the debt is repudiated, renegotiated and monetized. We both agree that, the can can’t be kicked forever. However, the major problem with any reasonable solution, is that the people that we look to for solutions are the very same people that got us into this mess in the first place. It’s not a matter of which party, the political process is truly broken. Government has grown so big, that soon there will be more government workers than private. Once this occurs, Peter states, “We’ll never get the reform we need.” The day of reckoning is just as certain as “death and taxes.”
Click Here to Listen to the Interview