Timber

 

 

by Larry Levin

Yesterday I ended with “There is more important news scheduled for Wednesday, Thursday, and Friday.  Additionally, the Greek situation may be coming to a head very soon.  In fact, Moody’s put Credit Agricole, SocGen, and BNP (French banks) on downgrade review due to the likelihood of a Greek default in the near future.”
 
The economic news, the Greek news, and the news from Moody’s put an axe to the prior day’s mighty oak that sprouted in the dung of the US economic data.  The indices dropped hard during a volatile and very choppy day.
 

1. Headline CPI was not zero as expected but still rising with a +0.2% increase for the month, while core inflation was also worse than expected at +0.3%.
2. Empire State Manufacturing Survey was in a word: dreadful.  The consensus reading was expected to be 14.0 but was actually -7.8.  “Recovery?”  What recovery?
3. Industrial production was also a bit worse than expected.
4. The Housing Market Index was worse than expected too.  Bloomberg said “Home builders are reporting the worst conditions since last year's post housing-stimulus fade. The housing market index fell a very sharp three points to 13. Components show a sweep of declines with future sales the weakest.”  
5. S&P downgraded four main Greek banks from B to CCC.
6. Greece’s capitol was deluged with protestors, which quickly became violent.
7. The Prime Minister of Greece said he was willing to step down and reorganize the entire government.  Problem: the leading opposition party that would take control is hell-bent against “austerity.”
8. Finally, the Irish made waves today when Mr. Noonan suggested they need debt restructuring too.  The IMF, he said, knew how rotted the Irish banking system was when it bailed out the bankster class…so screw them (so to speak).

 
When Ben Bernanke was reached for comment regarding this recent avalanche of bad news he said “It’s TRANSITORY.”
 

 

Trade Date: 6/15/11

E-Mini S&P Trades*

(before fees and commissions):

1. No "Secrets" trades filled today.

2. Algorithm positions (4)

3. "Reading the Tape" positions (6) ...combined Secret's, Algo, & "Reading the Tape" total... -5.25

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