You didn’t think we could have a market panic without the european banks having a go at your emotions, did you? Out of nowhere, the PIGS are back on the charcuterie table- with Portuguese/German bonds spreads widening, Italian, Greek banks plummeted. And, of course, the ECB is interested in making matters infinitely more complicated by throwing a bunch of red tape around the issue.
An ECB spokesman said on Sunday a number of banks would be asked about high levels of non-performing loans. The burden of such loans, particularly in Greece, Portugal, Spain and Italy, is curbing the euro zone’s economic recovery by limiting banks’ ability to lend.
“The uncertainty in the market, be it in Europe or wherever else, is causing these banks to suffer,” Mark Foulds, sales trader at ETX Capital, said, adding that the sector was also under pressure from recent volatility linked to China.
“When the markets fall like they have done, everyone feels on edge. The market is dire, and there’s not the liquidity that there used to be, which can mean the market gets oversold.”
Truth be told, I have a headache and don’t have the patience to dive into this right now. Let’s just assume everything is horrible in Europe and the Nazis will make life exceedingly difficult for the PIGS (Portugal, Italy, Greece, Spain). I am certain this new crisis will escalate on a cartoonish scale until the irresponsible half-men in europe decide to end it by bailing everyone out again.
IMPORTANT NOTICE: Ibc is hosting a February investors boot camp, online, with Jeff Macke, The Option Addict and Raul giving a thorough review of Exodus. It’s a one week live video event that will help you get a better read on this tape.
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