The Nuclear Option is Now on the Table
Okay, this is going to be a very simple trade.
First let me start off by saying this is not a surprise. We saw this train coming for weeks, if not months. The Italian locomotive of death and despair is here and it wants blood. Everything gets marked down because a full fledged crisis is now materializing. However, this is going to be resolved shortly. Let me tell you what is going to happen.
Italian 10 yr yields were hitting 7.6% earlier this morning, now trading at 7.26%. Spanish 10 yr yields are at 5.8%, approaching dangerous levels. And, believe it or not, French yields are widening, now 3.2%–record levels versus Germany. The ECB must monetize its debt or else pandemonium will hit the EZ and world markets are going to crash. The reason why markets are behaving like a gentleman with a top hat and white gloves, gingerly falling down a flight of stairs with grace, is because the nuclear option is on the table.
The nuclear option is the decision to monetize the debt in a non-sterile way aka printing of money.
Question for you to ponder: Will Germany walk away from the EU now and let the shit hit the fan?
If so, short oil with reckless abandon. WTI will fall $30 in a matter of weeks from current levels. On the other hand, if the nuclear option is initiated, gold and silver are your best plays. The denigration of paper money will funnel asset managers into hard assets.
Nothing else matters.
I will be taking this dip to add to my silver positions.
108 Responses to The Nuclear Option is Now on the Table
Has to be so.
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blow it up, who gives a fuck anymore
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Interesting phenomena to share.
http://stockcharts.com/h-sc/ui?s=$NYMO&p=D&b=5&g=0&id=p93086706271
This is the McClellan Oscillator, daily chart.
Now the weekly chart –
http://stockcharts.com/h-sc/ui?s=$NYMO&p=W&b=5&g=0&id=p13339892864
The weekly suggests the market is overbought and wants to correct. The daily shows that in the recent past, there are three dips into the buy zone before the market rises (similar to the Woodies CCI “ghost” formation).
I think today we are entering the second dip, which is the larger of the three. We’ll get a nice rise after this, then a lesser dip, and then it’s all in long after that.
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Lol!!
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Share your trading strategy kind sir, and let us entertain ourselves, accordingly.
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Costanza!!
Or maybe turn your charts upside down.
ReplyPingback: Poster's Paradise » The Nuclear Option is Now on the Table
It’s all BS! Europe sucks. We’ll see a huge sell off. Then people will start picking through the carnage and realize most of the companies whose stocks were castrated over this are not materially impacted or at least not as impacted as the drop off would indicate. I won’t pretend to be able to say where we’ll find the next “bottom,” but do believe that when it is hit some stock will bounce faster and higher than others. Short covering will accelerate the bounce. So, I’m looking for over sold stocks with high short interest with an approaching ex-dividend date. Shorts hate paying dividends.
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S&P 500 earnings will crumble once Europe decides to monetize or not. The benefit of a weak dollar is about to go poof in either scenario (monetize or do nothing)
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Monetize and its game over.
There will be no buyers of any of thie PIGGS debt ow that the CDS swaps are no longer money good due to extreme counterparty risk.
It’s too late for the ECB to get ahead of this and they don’t have the money to do so anyway. Europe is toast. Bond vigilantes want blood.
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Exactly..
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The sky is falling… the sky is falling. That’s your strategy?
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I think I can…I think I can…That’s your strategy?
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Been working so far…
http://en.wikipedia.org/wiki/File:SP500FF.svg
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Yes it has…
http://cbullitt.files.wordpress.com/2009/03/assholebadge.jpg?w=400&h=400
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The ECB has been lackluster, yes. But the argument that no one will buy reminds me of the argument that nobody will buy US bonds.That argument always turns out to be laughable.
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How dare the Eyetalians attempt to hinder the Turkey gods?
The Eytals will be lucky if said gods do not send their minions from Turkey to “Go All-Anzio” on they asses.
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you talkin bout germany ovah der?
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No, although there are certainly enough Turks in Germany to make a second front a possibility.
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Reminds me of when the camel fuckers in Dubai tried to throw down with the Turkey Gods in 2009. Bears got shart on something awful a couple of days after that.
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yep, ECB must buy a whole lot of bonds are non-fun will occur in large quantities.
but in the end they must create a mechanism to create new currency on a regular basis and in unlimited quantities.
Even the gold standard has constant new currency creation, constant. From gmold mining.
The US can create dollars and does most years (via deficit spending, the fed does not create new dollars)… So can Japan, the UK, etc.
The Eurozone, on the other hand, cannot. It is the worst monetary system ever devised.
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So true. Predictions of what’s going on now were made 10 years ago.
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That isn’t correct. The ECB increases the money supply in accordance to expected GDP increase and population expectations.. so around 2 to 3% per year.
The Euro is not a frozen quantity.
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Not frozen in the true sense of the work frozen, but it’s more like a disabled kid on crutches trying to make it up 3 flights of stairs.
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the trouble for the ECB is that it is prevented by law to bail any country out by buying its bonds. The Germaniacs are insistent on that, or have been up to now. Buying large amounts of bonds would be seen as a bailout.
The entire problem are the germaniacs if they relent they will simply QE.
I think that is their only hope.
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Agreed. What they should do and what they will do are too very different things. I don’t think they can change either that easily, or that quickly.
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BTW, this type of “bond vigilante” yield surge won’t ever happen in the US.
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If the ECB runs their printing presses does everybody get some? Or just the countries that have squandered their economy, errr- need debt relief?
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If WTI drops $30 does that mean crack spreads could widen or is Brent going down $30 as well?
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No Brent will remain exactly where it is. That totally makes sense.
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You think you know fuck everything!
You know fuck all!
(From last page in response to Teahouse’s Atlantic Monthly article trumpeting the badly mistaken Judge Silberman’s ruling. It’s a shame The Atlantic Monthly can’t find a decent legal analyst.)
Unfortunately for the Confiscatory Libtard Cause, Silberman got his interpretation wrong. It’s not even a complicated explanation…
If one is to use Wickard v. Filburn(See page 30 of the ruling) to justify a Commerce Clause allowance for Obamacare Constitutionality, one would have to use the insurance company as the variable in place of the farmer, not the insured, which Obamacare compels.
Silberman, probably because he needs to take the long vacation of retirement, made a logical error in equating purchasing with providing, which is what Wickard contemplates.
And if you think something as logically simple to understand as that is going to get past the razor sharp brains of the Conservative members of the Supreme Court, you truly are living in Liberal Loopy Land. But good luck with that.
As an aside, what is truly distressing to me, however, is how someone who purports to be for a free and open economy could actually cheer a senile judge’s ruling to compel the purchase of any good or service.
What fucking country is it you’d like to live in, exactly? What other things would you have Congress force you to purchase?
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In Canada, we are compelled to purchase liabiity insurance in order to legally operate a motor vehicle. I would assume the same is true in the US. Similar principle,n’est pas?
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No, because you do not have to drive. And the insurance in that case is for the protection of others you might harm, not your own protection.
Also, there are alternate forms of transportation. In the case of health insurance, there are alternate forms of financing one’s healthcare.
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One is “free” to ignore the law and drive without insurance … happens all the time especially with the illegals.
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Doesn’t that make you a racist Tea?
Aren’t you supposed to be applying the National Socialist’s Party principles of dictating that certain races and nationalities get special protections that gain superior treatment to “traditional” Americans?
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Not I sir … As I said, I’m an Independent and mostly in the middle but left on some issues and right on others. I oppose illegal aliens obtaining citizen rights and in fact think the amendment making children born in the U.S. automatic citizens changed … their parents s/b legal citizens for them to obtain the rights and privileges of this country.
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Aren’t those of us who pay for insurance covering the cost of those that don’t?
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I’m sure you can conclude where i’m going with this.
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I for one would like to not pay for the freeloaders and have them actually pay something so I can get a break in the cost I pay.
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What other forced payments would you have Congress compel?
There are other ways of dealing with freeloaders besides the abrogation of freedom.
Especially those that lead to abysmally slippery slopes.
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I say burn down congress and the healthcare system and start over. They’re both fucked up. 
its Doctors and Hospitals driving costs..insurance companies base their rates on the bills they have to pay submitted by doctors and hospitals…those big hi tech hospitals with all those rooms (that everybody loves when they need em) have to be paid for regardless of occupancy….of course people that run to the doctor every time they have a scratchy throat dont help either!!!
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I work in the industry. You should see the ridiculous mark up’s on drugs. Some higher than 1000%, no BS.
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If we make the market price sensitive by structuring like it was in the old days, with insurance only for catastrophic (i.e, over $5k) bills, and “first dollar” being paid out of a HSA or some similar tax friendly account (which Obamacare got rid of, by the way!), then you will see hospitals magically moving toward a competitive market system, and insurance companies no longer telling you where you “gotta go.”
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or you could just mandate the hospitals ignore the uninsured as they have “opted out” of the system … Congress can forgive the medical industry for violating their Hypocratic [sic] Oath.
As I already mentioned, there are other ways of dealing with indigent care — market based ways — that do not entail State Authoritarianism.
What other freedoms are you willing to sacrifice to the bureaucratic gods in Washington, Teahouse? Because if you let this one go through, it will only be the beginning.
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As I’ve said earlier, we’ve already done that on a State level with mandatory auto insurance … you don’t gripe about that. Does it really matter which bureaucracy, state or Federal, does the mandating.
Indeed we do. But aren’t US hospitals compelled to provide emergency care to all? IE: those who pay, cover those who don’t..
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Exactly. Which is why I keep getting screwed every fucking year a renew my health insurance. I’m sick of this bullshit.
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If you think your health insurance costs are going up because of ER care, rather than state ologopolistic pricing (through the compelling of certain care characteristics), then you are not familiar with the health care pricing structure.
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Not just ER care, but insurance companies are the one’s paying for ER care and just about everything else, aren’t they?
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No, hospitals take the hit for non-paid ER care.
Insurance companies absorb some of that cost via higher total overhead pricing by hospitals.
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“some” ???
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Yeah, insurers are not the only ones who pay hospital receivables you know.
Or maybe you don’t.
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or maybe you minimize the cost passed off to insured via their providers (???)
This is where the travesty began. The Hill-Burton act, where hospitals were compelled to provide indigent care for accepting gov’t financing. thereby beginning the cost shift to people who could pay more. That and tax free health benefits to employees which got us on the workplace provided health insurance model. It’s a whole system of unintended consequences.
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Agreud. Another reform would be to make health insurance mobile and independent (ie, not dependent on one’s employer).
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like Obamacare … LOL
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with a public option of course
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Obamacare is top down price controlled gummint interferernce. It’s the last thing to mobility anyone could ever hope for.
All it guarantees are runaway costs and decreased care. Quite the daily double.
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Absolutely. Could not agree more. And it should be paid for by the individual with pre-tax dollars, like an HSA. And, all prices for any consultations and procedures should be freely available for all to see and compare.
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and then the best providers will join elite insurers and pricing that excludes the avg citizen will exclude them from the best care as they are forced to insured with providers based on their ability to pay … more elitism!
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nothing to see here only down 275 .. this should be down 800.
there could be a deal cut behind the scenes today, maybe watch fins for a tell?
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Money printing and monetizing debt would work if there was growth. There’s no growth
Italy has maintained its debt with an average 0.6 gdp. Yields blowing out no way. Spain very bleak growth. Unsustainable
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You my friend have lost your compass .
You are passing bad advice with every
post and the children are following .
Silver , really ? Jeezus , buy gold
and forget this poor man b.s.
BANNED
EXK is UP.
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He should be banned for having Ohio State in his moniker anyway.
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WHHAAAA?
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That’s what “THEosu” is short for — “THE Ohio State University”
If you watch NFL games during the intros, that’s what the players who went there say.
Like my large main man, Giant TE, Jake Ballard.
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Fuck Gold
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I agree with Fly’s analysis. I only question timing. Seeing how demented these cocksuckers acted in 2008/2009 why not wait to see what they do and then act. It’ll take months for them to get their act in gear. The FED took 3 months or so to get the ball rolling in 2009.
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$GOLD is the driver, but $SILVER will follow and the gains will be greater. I would be worried however as it approaches 40, because the parabola has been broken recently and it will take awhile for it to recover completely. GDX on the other hand is just waiting to take off and its possibilities are very great because it has consolidated for so long.
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I am in deep in silver bullion. However, I have no expectation other than absolute manipulation of the price. Holding for when the USD finally gets traded in for another fiat currency, thereby diminishing the wealth of the Western world and moving it to the third world (central banker beat-off material).
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Does Italy still have to pony up their 18% of the EFSF or do Germany and France shoulder the burden?
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They’re fucked, which is why either The PIIGS leave the Euro, Germany does or they QE. Italy can’t fork over 18% of anything.
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It was a rhetorical question. Close to half of the EFSF fund is supposed to come from those that needed to be bailed out.
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It’s going to be a meatballs and sauce thanksgiving this year.
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If you think ECB will come bail out Europe…think again according to these guys:
65% chance of European meltdown by end of November
http://www.cnbc.com/id/45218531
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I hear Mitch McConnell is sponsoring a bill to have “personhood” given to money. Holy Crap! Just think of all the new voters there will be with more money printed.
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That’s some craptastic humor, there.
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One dollar, one vote.
One million dollars, ten million votes.
One billion dollars, don’t need votes.
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Three trillion dollars in a budget…
Why vote?
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the Birchers lost that one in ole MS, one of the most conservative states in the nation … time for the Right to put that shit to bed and respect women’s rights sans Cain.
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Yeah, let’s go butcher some babies in celebration!
Woohoo!
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So lame …
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I wonder if K. McCoolah has put any of that cash to work?
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Look the shit hit the fan this morning. Put on your shit suit and get a lot of baby wipes. ECB currently can’t leagally QE, and politically won’t.
Italy’s debt is bigger than all of the other PIIGS (according to Bloomberg). They’re going to market with a bill auction tomorrow. Should be fun.
BTW, why are we discussing ObamaCare in here when the world is falling apart? France and Italy have economies that are historically intertwined.
My dumb ass guess is that France is next up, not Spain as I had thought. Watch those spreads, and stock up on baby wipes. They will be out of stock when you really need them.
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Obamacare is part of the reason the world is falling apart… it’s speeding us on to our very own debt crisis.
Plus, Teahouse was trumpeting the Silberman ruling yesterday, which was actually built upon a misinterpretaton of a prior ruling to an embarrassing degree.
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Trumpeting? I just pointed out that even a Reagan Conservative Justice agreed that National Healthcare was legal and with all the other court rulings it makes it that much harder for the Supreme Court to even hear the case.
Jake, you spin so much wool here you have nothing to fear, that sweater will be done by Christmas for sure.
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You trumpeted it, despite not understanding even what you were linking to.
Typical Demmie, unfortch.
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Like Rush says Jake, Demmigod’s lack intellectual acuity to factually reason through higher orders of logic.
I still don’t think that’s a reason to give them a “PASS.”
Fight on.
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The thing about Obamacare, is that if the personal mandate is found unconstitutional, the next step would be to just tax and provide the benefit, cutting out the private insurers.
The next election might just determine if there’s enough juice in the tank. I’m not so sure either side, left or right has much gas in the tank anymore. Nonetheless, it will be an interesting election.
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Explain yourself. “Tax” whom and “provide” what benefit?
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Sounds like the Canadian system; flawed, for sure, but nobody here goes bankrupt because of a medical problem either. That kind of “freedom” I could live without.
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You guys really think all the yield-starved pension funds are not going to put a bid under Italy north of 7%? Italy is not greece, its closer to Japan – a heavy debt load but mostly domestically held, with a strong but slow economy.
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@Spook’s – you need to factor in the hair cut those bonds will be getting. They can’t pay those yields, that’s the real problem. They will get a haircut like the Greek debt did.
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Yes. They have a developing demographic problem like Japan too.
I would disagree about the pension funds though. Austerity austerity austerity
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Italian citizens do not have 70% savings rates or a sense of duty to their country. They will move first to screw over anyone who is not Italian, and then second their own citizens.
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The US Great Depression was so bad NOT because of the stock market crash, but (1) the sovereign debt crisis that wiped out savings and reduced capital in the USA contributing to over 3000 bank failures, and (2) the Dust Bowl that eliminated agrarian jobs when agriculture accounted for 40% of the civil work force resulting in the “hobo” lifestyle.
It was WWII that provided the “transition” reducing unemployment and transformed farmers into skilled labor.
Poker player captures $8.7 million prize
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Today is the time to buy for the next two-day rally up. Get ready kids.
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BOT GS December 100 puts
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great play
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BANNED!
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Actually, if you go back more than 24 hours, the Fly was banking only on a run to Christmas, then was waiting for a short into the new year.
This is an annual speculation; waiting for the Gift of the Gobble.
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Ha! You beat Fly to it.
But I agree, BANNED.
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