A shot across the bow in an 18th Century naval battle was intended to fall harmlessly into the sea but had a purpose: WARNING! If the ship on the receiving end of the warning shot didn’t comply, there would be hell to pay.
As you surely know by now, Standard & Poor’s rating agency lobbed a shot across the bow of the US White House and Congress, which came in the form of a downgrade warning. If the US government doesn’t get its fiscal mess in order, S&P will no longer sit silently as the profligate spending goes on unabated. It gave the government until 2013 to stop the insanity.
From the S&P statement we read - We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer 'AAA' sovereigns.
Said another way, the White House and Congress must stop playing games (read: lying) and stop deficit spending now. No more claimed billions upon billions of cuts that are actually only $300 million or so. No more cuts only in the “out years” once the politicians are out of offices that are, incidentally, never cut. No more double-book-accounting, etc…or else.
But that wasn’t the only problem the markets had to deal with Monday morning. Finland voted in a new government that is anti-bailout. It sounds like the people of Finland have had enough and do not want to throw good money after bad (Greece, Ireland, and Portugal). The electorate knows that their funds are actually bailing out the German, French, and English banks which isn’t sitting well with the people. This could spoil the bailout party in Europe.
As you surely know by now, Standard & Poor’s rating agency lobbed a shot across the bow of the US White House and Congress, which came in the form of a downgrade warning. If the US government doesn’t get its fiscal mess in order, S&P will no longer sit silently as the profligate spending goes on unabated. It gave the government until 2013 to stop the insanity.
From the S&P statement we read - We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013; if an agreement is not reached and meaningful implementation does not begin by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer 'AAA' sovereigns.
Said another way, the White House and Congress must stop playing games (read: lying) and stop deficit spending now. No more claimed billions upon billions of cuts that are actually only $300 million or so. No more cuts only in the “out years” once the politicians are out of offices that are, incidentally, never cut. No more double-book-accounting, etc…or else.
But that wasn’t the only problem the markets had to deal with Monday morning. Finland voted in a new government that is anti-bailout. It sounds like the people of Finland have had enough and do not want to throw good money after bad (Greece, Ireland, and Portugal). The electorate knows that their funds are actually bailing out the German, French, and English banks which isn’t sitting well with the people. This could spoil the bailout party in Europe.
Trade Date: 4/18/11
E-Mini S&P Trades*
(before fees and commissions):
E-Mini S&P Trades*
(before fees and commissions):
|
Sign up as an AvidTrader Member to receive "The Technician" Value Area's each day. The market then has an 80% chance of filling the Value Area. Many traders familiar with the Value Area and the techniques that go along with it use it to help them decide what trades to do each day. Join and see how this technique can help you trade more successfully!
No comments:
Post a Comment