WASHINGTON, June 12, 2012 – As we pretty much predicted yesterday, the market opened on a positive note, buoyed by the EU’s “agreement” to bail out Spanish banks to the tune of about €125B (we think). The market was juiced at the open, but then swooned, perhaps in a bit of penance for last week’s bullish tilt, but more likely due to reading the fine-print on dealing with the rain in Spain.
So guess what? Futures are up again this morning, and the bulls are rarin’ to go. Or not. Bears these days tend to show up late morning or early afternoon, swamping the morning’s predictably wasted buying power. This week could be different, given that it ends with a quadruple witching Friday (see yesterday’s Market Maven post). So who knows, really. Our banner graphic, derived from an old Australian PR poster, kinda gives you a more accurate picture of this week’s likely action.
Bottom line is, things are likely to remain volatile and probably negative in the end, as we have Greek elections next week, with polls predicting socialist gains. Apparently, what the Greeks really, really want is to get all their jobs back; retire at full pensions at the age of 50; keep the Euro; have the Germans continue to send them money forever to fund this; not pay any taxes; and denounce the evils of capitalism whilst camped out at a nice outdoor café nursing a bottle of retsina.
You know what? We’d like some of that too, particularly after the pounding that everybody except JP Morgan, Goldman Sachs, and officials of the Obama administration have been taking since roughly Inauguration Day 2009. Problem is, the Greeks got there first and the Germans will be out of money by the time they get to us.
What a picture. We are beginning to think that the markets will remain virtually uninvestible until our own problems are (presumably) sorted out this November. If Mitt Romney wins, we might have a chance to get the economy moving again. If Barack “Choom”* Obama cops the brass ring again, we may have to purchase a couple of parka’s and emigrate to one of Canada’s western provinces where they still believe that drilling for and utilizing their own energy resources are a very good thing.
Not much to say about the upcoming nonsense today. We’ll have at least one or two great days this week, simply because of quadruple witching nonsense. And we already know that yesterday wasn’t one of those days.
So again, to the mattresses, to the utilities, whilst allocating at least a few bucks to getting fresh canned goods into your survival bunker. (Rest assured, the Feds already have stocked a great big one in the Blue Ridge Mountains, not far from where we’re writing this.) Nimble traders and option scalpers can actually have a lot of fun during a week like this, moving in and out, often daily, to take advantage of the computerized nonsense currently dominating the markets while most investors who are left seem to be hiding in zero-yield treasuries.
We however, as we’ve noted, remain invested in mattresses, utilities, and the occasional REIT, earnestly hoping that the rogue EPA won’t come up with some bright new rule that bans fossil fuel-burning utilities from generating any power at all. Hopefully, we—and the market—won’t have to deal with these job-sapping dopes in 2013.
But then again, we’ll always have Europe.
* The Urban Dictionary provides us with interesting additional parsings of this delightfully onomatopoetic neologism.
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