Trying halfheartedly to find something bullish to grip onto

*At least this was not negative;

-As mentioned on several occassions over the last month, the Japanese authorities are throwing all they got at supporting their struggling corporates ahead of year end. Overnight, Japanese authorities announced they will be utilising 5 BN Usd from their FX reserves to support struggling Japanese corporates.

- Overnight, the Australian central bank (RBA) left their rates unchanged at 3.25%.
It would seem the RBA are awaiting the effect of measures taken so far before proceeding. Given that the recent Australian data actually has been stronger than other regions, it seems a reasonable conclusion. (Retailsales, C/A deficit, trade surplus, exports and imports have been better than expected or better than previous time period.) This triggered stops in many currencypairs, and made sentiment more positive, with equity markets clawing back losses.


- The move lower in equities yesterday was on very low volume.

Sorry , but I will leave it at that for the time being. The weakish JPY factor should at least help lower the deleveraging pressure and pace to some extent at least, despite it moving towards more illiquid assetclasses.

Other than that, the most positive sign I can find is that bearish momentum in equities seems to be loosing steam and pace, despite breaking lower through important levels. Worth monitoring implied volatilities. Given all the bearish macro news and other bearish news being pumped out on a daily basis, quite a bit more mayhem would have seem to be in place.

Anyway, yesterday I closed my long Usd/Zar after reaching the 10.50 target. Ditto for my long Usd/Cad in the low 1.29;s. The way the price action looks in Usd/Zar, a clear break of 10.50 will make me go long again, though. Next stop will then be 10.75/80 before 11.15.

*Gold continues to look top heavy, I have added to my shorts.

*Bailouts and bankinsolvencies

Other than that, Im getting numb by all the US bailoutpackages and by now it would seem that it should be clear to everyone that there is no quick fix easy solution other than taking the stop loss.

That would mean governments would need to come clean and admit that many of their banks are insolvent and then deal with it. As long as they keep pretending they are not, this will not end. business pretend, so to speak. One should remember that Europe is having its own subprime taking place right here and now and we have only seen the beginning of it.

This goes especially for governments of banks with heavy exposure towards the Baltics, the CEE but also the PIIGS countries. The absolute first on this "come clean about bank insolvency list" are governments owning banks with exposure to the BELL(alledgedly coined by strategists at Merrill Lynch, ehhh Bank of America) countries; Bulgaria, Estonia, Latvia and Lithuania. It is no coincidence that all of the BELL countries are under fixed or semi fixed currency regimes. They will all float.

As mentioned several times before, no substantial bank intermediary effect will be seen from governments pumping liquidity into banks til the "bad assets" are being separated from the good ones. The really frightening issue is whether these giant bad assets are really bailable.

At least, governments should stop pumping taxpayer money into countries with fixed or semifixed currency regimes. It is simply wasting capital. They will soon need it themselves. Cash is king, or was it options?

As always, good luck

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