Late last week I wrote of Dexia bank: "The bailout rumor that sparked the massive short-covering rally Tuesday is still intact. What's odd, however, is that the rumor has yet to be substantiated. Indeed, it is still a fantasy of the banking mafia to date. Nevertheless, the march higher on putrid volume continues and has nearly reached a staggering 100-point reversal from the low."
The rumor of a private bailout turns out to be false. Dexia is being 100% NATIONALIZED by the countries of Belgium and France.
Reuters reported "The governments of France, Belgium and Luxembourg reached agreement on Sunday on a rescue package for Dexia, which will be put to the stricken Franco-Belgian bank's board later in the day for approval."
So France, Belgium, and Luxembourg will take over the failed bank, which means it not only guarantees the deposits of taxpayers, it also assumes the liabilities of the bank. On Friday these governments were not on the hook to pay off Dexia's liabilities. Come Monday, they are. I can only assume that this will bring more downgrades to the Eurozone - these counties in particular.
Speaking of downgrades, last Friday brought several; Italy was downgraded again, Spain's was downgraded, and Belgium was put under rating review. I can't help but wonder if the ratings agencies knew the nationalization was coming and got in front of it.
The rumor of a private bailout turns out to be false. Dexia is being 100% NATIONALIZED by the countries of Belgium and France.
Reuters reported "The governments of France, Belgium and Luxembourg reached agreement on Sunday on a rescue package for Dexia, which will be put to the stricken Franco-Belgian bank's board later in the day for approval."
So France, Belgium, and Luxembourg will take over the failed bank, which means it not only guarantees the deposits of taxpayers, it also assumes the liabilities of the bank. On Friday these governments were not on the hook to pay off Dexia's liabilities. Come Monday, they are. I can only assume that this will bring more downgrades to the Eurozone - these counties in particular.
Speaking of downgrades, last Friday brought several; Italy was downgraded again, Spain's was downgraded, and Belgium was put under rating review. I can't help but wonder if the ratings agencies knew the nationalization was coming and got in front of it.
The question remains, however: will France be downgraded too?
Trade Date: 10/7/11
E-Mini S&P Trades*
(before fees and commissions):
E-Mini S&P Trades*
(before fees and commissions):
1. FT sell @ 8:44am at 1160.50 = +2.00 & +2.25 (2 lot)
2. Algorithm positions (12)
3. "Reading the Tape" positions (2) ...combined Secret's, Algo, & "Reading the Tape" total...+10.50
2. Algorithm positions (12)
3. "Reading the Tape" positions (2) ...combined Secret's, Algo, & "Reading the Tape" total...+10.50
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