Paper Late

It's too easy to talk about rocking the boat
Making changes and changing track
But you better not lock that door
'Cause you'll be coming back
--Genesis

I remember 9/19/2008 well. I recall the jovial happy b-day greeting sung by my mom and brother when I walked thru their door. It was grandparent's day at St Columban, and I proudly escorted Mom as my niece and nephew showed us their hallowed halls. We were still reeling from an inland hurricane the weekend before, and many homes were still without power.

It was also the day that the US government declared martial law on financial markets. Among other things, this entailed banning short sales on financial stocks--to curb the actions of 'speculators.' The Dow was at about 8000 at the time. After a voracious multi-day short covering rally that took the Dow to 9500ish, the selling returned with a vengeance. The Dow bottomed six months later at 6500 in the midst of an additional Shock and Awe campaign of stimulus.

This past weekend, the EU rolled out its own version of Shock and Awe in the form of a $1 trillion bailout package of Greece and other week EU members. Essentially, this involves Germany, France, and the IMF (read: the US) tossing in funds and printing money to prop up the debt of other EU members. The rhetoric included rationale aimed to curb 'speculators' against the euro and EU sovereign paper. Markets around the world are partying today, with world indices up anywhere from 4-12%.

Once again, the world is trying to paper over a debt problem w/ more debt.

Perhaps the end game is pushed out once more. But my sense is growing that the paper chase is getting long in the tooth.

position in SPX