Jim, the G-7 meets Sat. in Rome for a prelim, and I can bet the Europeans are going to be berated by US, as the ECB took a pass on more easing recently, thus screwing up the FED/Treasury plan of a worldwide concerted float.
The Europeans must be fed up with Pax-America, shoving it up our asses on the GE/HON deal, and not following the plan on cutting rates.
They want something from US, and I bet they get it in exchange for further ECB easing.
From Bloomberg:
The U.S. Federal Reserve has pared borrowing costs six times this year and
Congress has passed a $1.35 trillion tax cut, steps that show signs of reviving
the world's largest economy. The European Central Bank lowered rates once
while German Chancellor Gerhard Schroeder said he won't accelerate tax
reductions.
Europe and Japan ``need to play a locomotive role as well,'' U.S. Treasury
Secretary Paul O'Neill said before leaving for Rome. I guess we call it a train now???
World economic growth will halve to 2 percent this year, according to the
Organization for Economic Cooperation and Development. Japan, the world's
second largest economy, is in its fourth recession in a decade. Germany,
Europe's largest economy, may not have grown at all last quarter, the
government said.
``The U.S. is certainly annoyed at Europe,'' said Anne Mills, chief economist at
Brown Brothers Harriman & Co. in New York. ``The ECB has fiddled while the
European economy smoulders.''
The euro has declined 10 percent against the dollar this year as investors expect
faster growth in the U.S. than in Europe by the fourth quarter. The yen has
dropped 9 percent against the dollar.
The finance ministers don't plan to issue a statement urging changes in foreign
currency rates and economic policy. Central bankers will be absent, as ministers
prepare for a leaders' summit in Genoa, Italy on July 20-22.
Maybe after options expiration (20 July) the markets will get that lift?? This coming G-7 stuff should ignite a nice rally, the timing to get in is the only real question, as they are going to pull the stops out. So, I want to be long the indexes before Monday 23 July, at least that is my thinking this minute.
One of my ideas to play a ECB rate cut is LEON long. I imagine they want to extract something from US in order to keep the game going. Ah, politics.
My rebought ORCL 17.5 puts up 55% today, the $20's up 40%, cashed out..this stuff will drive you crazy. |
