- Europe’s Fatal Flaw Laid Bare For All To See. Again. (The Automatic Earth, Oct , Oct 17, 2014):
markets, at the end of last week, sort of refound their – shaky – feet, oil up a dollar, EU exchanges up 3% or so, Greece even up over 7%, while interestingly gold didn’t move much at all during the wild week (no safe haven), and most movement was perhaps, through all the see-saw, in bonds. To sum up the week: panic followed by plunge protection teams. And now the ‘leaders’ hope plunge protection will save another day too.
And they may. Germany sinks a bit, but Germany is strong. US housing is at least not falling further, but US consumer spending stalls and drops. The deep dark weakness has not yet hit the big economies. But the nerves are back. Volatility is back with a vengeance. As it should. And that will paint the picture going forward, plunge protection or not. Da markets will come again and again and dare central banks to plunge protect. Continue reading »