This sums up how I feel year to date.
“Bond and Currency markets are now so rigged by policy makers that I have no meaningful insights to offer, other than my bubble fears.” Bob Janjuah, Nomura
There are no trades out there anymore. There is just a whole lot of reaction.
Reaction to the theatrics of global political stage.
And today I turned long EUR/USD for the day, throw in the AUD/SGD and USD/JPY too. Just reacting.
No need to think too much about it. It is blind reaction to Greece, ranked about 32nd in the world for nominal GDP by IMF in 2010.Greece is about the a tenth the size ofGermany and an eighth ofFrance, a quarter ofSpain and actually, bigger thanPortugal.
So Greece is not a toe-nail afterall.
Despite the positive headlines, we still have those loose ends.
There is the collateral for Finland, the CDS trigger, the “Collective Action Clause, who is really represented by the IIF, the $20Bn budget shortfall, the contribution of the IMF, the methodology for handing Greece the money, possible further notions that Greece has not met its commitments, law suits on the way for the ECB’s subordination of private bond holders and for the “haircut” coercion where different classes of investors have been retroactively applied and for the retroactive implementation of some “CAC”. All of these things are forthcoming regardless of what we find in Europe’s pronouncements so that the lens laid over today’s sun will tomorrow be removed and the glare of the light will be startling in its clarity and reflection. http://www.zerohedge.com/news/tomorrow-and-tomorrow-and-tomorrow-0
EUR/USD is still going to test 1.3330, the taboo level where the stops are. I will square before that. Looks like no more fresh news out ofEurope. So it’s a game of who blinks first and the fastest draw wins and the last one left carries baby home.