Fail and Bail

So forget all that you see
It's not reality
It's just a fantasy
--Aldo Nova

Equity markets screamed higher worldwide on news that EU nations and banks struck an agreement on a Greek debt writedown and containment fund bolstering. Still largely concept only but that's obviously not today's business for the markets.

Banks were really on fire, with many putting on 10% or more today. One reason: the language of the accord makes the 50% haircuts to be taken by some bondholder 'voluntary.' As such, this is not viewed as an outright 'credit event' (a.k.a. default), so banks who are short Greek credit default swaps cannot be tapped.

Nothing like a little wordsmithing to line banker pockets...

The current agreement solves nothing and is consistent w/ the approach that bureaucrats continue to elect. Paper over a problem with more money printing, debt, and leverage. Tears is where this will end, but again that's not today's issue.

On the domestic front, President Obama announced a bailout of his own. Those burdened w/ college loans will be able to limit their debt payments to 10% of income, with the balance of loans to be forgiven after 20 yrs.

This, of course, is nothing more than pure vote buying on the president's part. He is also once again sidestepping Congress and the inconvenience of the Constitution to issue an 'executive order' to enact this policy.

Does a bailout a day keep reality away?

position in SPX