FWIW, here is my current view on things:

In our world today, it is indisputably clear for all to see, that a globe made up of individual sovereign states governed by nationally elected statesmen has almost completely ceded way to a new paradigm.  The international banking & corporate titans are now the real powers directing world affairs.  To understand what comes next in our economic outlook, and how the market may react to it, it is essential to think about what these new centers of power are interested in. 

The first order of business for our new masters, is to take full advantage of the sovereign debt crisis now imploding in Europe.  Rahm Emanuel's mantra comes to mind "never let a major crisis go to waste".  One could even go so far, as to make the case, that the current debt crisis now engulfing Europe was actually initiated by the financial oligarchs themselves, so as to further consolidate their grip on the independent nation states.  After all, it was the financial & commercial elites of the world, that most fiercely advocated for, and imposed the EU & EURO on to the Sovereigns.

Saving Italy & Spain from financial collapse, and protecting all of Europe from descending into a great debt depression will no doubt be sighted as the reasons for their bold actions.  But the real and much more sinister motivation, is to use this crisis, to further consolidate the powers of the EU & the international banking cabal over the Sovereigns, by creating a Pan European bond market.  The final result, will be the near total evisceration of the national right of a country to direct its own monetary & fiscal affairs.  All of this delivered without even one vote ever being cast by a Nation's own people. 

So here is my take on how this raging European debt crisis will unfold.  A new stealth QE3 will be devised by the upper most echelons of the international banking cabal.  The heads of the TBTFs both here and abroad, world renowned financial industry wizards, and esteemed economic academia, will assert their influence on the FED / Treasury to roll out the following.  Let's call it Evil Plan 3.0………..

The FED will implement its established currency swap lines to wire massive amounts of new digital USD currency to the ECB.  The ECB will then use these new funds, much like the FED did with TARP & QE2, so as to shore up the European banking system, instill confidence in national bond markets, and support all financial asset classes.  These actions will also serve to prop up the EURO, and keep downward pressure on the USD.  Both of which are desired outcomes by international banking & multi-national corporate interests.

So how will this effect the U.S. equity markets you ask?  My best guess is, that this newly unleashed liquidity Juggernaut will once again find its way into all financial risk assets.  So after this policy is announced over the weekend, and is implemented next week, I am expecting a sharp relief rally which normally would be quickly sold off, but much to all our surprise, will sustain itself, and possibly carry the market back up near 1300……….PMs should continue to shine brightly (Happy B-Day Dutch!). 

 
 Written by BDI  (SOH's Idiot Savant)

FWIW, the following is my current take on things:      ( Much to the chagrin of fat Pandy )

Both sides in the relentless debt-ceiling debate are getting further and further entrenched, and hardened in their respective positions.  If a grand compromise was to be reached, it should have happened by now.  The reason for this impasse is clear.  Each side knows full well, that if they abandon their principled positions, they will completely alienate their base, and most likely not be in power come November 2012.  
 
The Democrats want to maintain near term spending in place, so as to both appease their liberal base, and more importantly, keep the sputtering economy afloat until the elections.  Also, they have Benny & the Jetts in their pocket, ready to give them an extra jolt of QE, a few months before the actual elections takes place. 
 
The Republicans on the other hand, know exactly what brought them back to power, and that was having taken a firm principled position on curtailing massive government over spending.  The critical Tea-Party vote certainly made that crystal clear. They also know, that if they force Obuma's hand by demanding and obtaining major upfront reductions in spending, it will most likely stall the economy going into the critical elections.  Thus, putting further blame on Obuma's mis-handling of the economy. 
 
The point here, is simply that both sides know, that if they give in to the other in the slightest, they will seal their fate come election time. 
 
Thus, having said this, my view is that the following scenario will come to fruition;  As the impasse closes in on the August 2nd deadline, Obuma & Geithner will instruct Benny & the Jetts to orchestrate a brief very sharp waterfall decline in the Dow, so as to scare the pants off of the Republicans, forcing them to the table for a compromise.  This also may very well explain why we got that incredulous moon shot out of nowhere, in the face of continued worsening economic fundamentals. They simply used the supposed Greek band-aid as an excuse to turbo charge a rally, so as to give themselves the necessary room for the pending planned waterfall. 

Evil plan a la Tarp 2.0 is in place….. 
 
Consider yourselves warned…..and position yourselves accordingly as we approach the August 2nd day of reckoning.

  
  BDI  (Idiot Savant) 

Beware The Aging Raging Bull

A young bull is fresh and full of vigor, a more mature bull is strong and determined, the old fatigued bull is   irritable, distressed, and often dangerous.  This historic bull market certainly has had quite a remarkable run, but I contend that it is currently showing signs of exhaustion.  The first leg which began in the Spring of 2009, like a young bull, was certainly fresh and invigorating.  The second leg, as a more mature bull, was strong, determined and persistent.  This final leg, much like an aging bull, has been unstable, irratic and belligerent.  2011 sure has been a rough ride thus far for this grizzled, irritable, exhausted bull…………heaving to and fro…………bucking wildly up and down…………throwing many a seasoned traders face first into the dirt.

For all those Slopers bulled up by last week's impressive yet "suspect" parabolic move in the dow, you may want to take pause and consider whether this truly is the revived 3rd leg of a seemingly indomitable bull market, or perhaps rather the beginning of the end for this majestic animal.  All you raging bulls will undoubtedly snort……"How can you call this a suspect rally?!"   Well, it's not to often that we see a spectacular relentless 700 point surge on the dow in only 5 days.  Particularly one seemingly based off of nothing more than yet another Greek bailout band aid followed by a below average ISM number. 

Forgive my dubiosity, but what I saw last week started out as; an expected relief bounce off of the much anticipated narrowly passed Greek austerity vote, combined with end of quarter window dressing & a dash of pre 4th of July exuberance, which then suddenly morphed into a turbo charged rally by setting off a mechanical, bot driven short squeeze on low volume. Who let the dogs out?  "The algos dogs were then let loose order "stuffing" their way up to each stop without pausing, and scaring mental stops into action along the way."  Adding to the heroics, was a very timely Chinese EURO pump, with Benny & the Jetts piling on for good measure, by firing up the re-activated FED/ECB currency swap lines, furthur pushing the EUR/USD back up towards the recent highs. 

One would be hard pressed to attribute this sudden explosive rally to any recent revelation of actualized gains in a particular business sector, or any newly discovered fundamental strengths in our sputtering economy as a whole.  What does that tell us about the legitimacy of this super spike, will it have staying power?  Is it some sort of belated blow off top…..is it irrational……is it real?

Five ways to know if a bull market is over:

1)    Oil prices surge and remain elevated………check

2)    Treasury yields begin to run up………qualified check (may well have begun)

3)    Number of rising stocks starts to shrink………check

4)    Consumer spending often slows………check

5)    Corporate earnings growth starts to slow………qualified check (will know for sure shortly)

One final note from your favorite Idiot Savant……Parabolic moves generally don't end well, especially when they are manufactured………They're planting stories in the press.