Monday, May 10, 2010

Already a House of Cards, Europe piles on €1 Trillion more worth of debt

Just a quick follow up to my post yesterday regarding "Europe Engaged in 25 Hour Rescue of the Markets," it turns out that the initial amount of €560 was deemed "simply not enough" by some at the Euro Zone bargaining table last evening. The announcement came out at 3:20am (Belgium time) and it immediately pushed the futures up in the US by 2% and the Euro up 2.8% against the dollar. By the time I went to bed, futures were up nearly 3%, and the Euro steadied at $1.29. Six and a half hours later, when I awoke, to the surprise of many I am sure, the futures were up a whopping 4.7% and the Euro had reached $1.31 from just $1.25 12 hours earlier.

The UK Telegraph has a great article that explains some of the more obvious inevitable ramifications. I'll let our readers decide, however, some of the more subtle events that could transpire by the time this all comes home to roost. Indeed, I would love to get some feedback, as all this "government assistance" has risen to the point where it is now well over my head. Regardless, I sure hope the short-term gains of the few are worth it for the long-term pain we are all going to feel if this "ALL-IN" shove doesn't work. It has been said that the US bank bailouts were sending good money after bad. When we create €1,000,000,000,000 out of thin air I start questioning whether or not the money we are sending after bad qualifies as "good."

Hey Billy, can you kick the can this time, I have to spit.

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