Mario Draghi, President of the ECB, had to eat humble pie today and admit publicly that indeed he does not have the authority to do what he wants to do. And the Bundesbank let it be known that Monti will not be allowed to do whatever he wants to, that the ECB needs authorization from European politicians.
Markets reacted sharply and immediately. Yields on Spanish 10-year bonds jumped to 7.165% (up .433) and Italian 10 year bond yield had jumped to 6.327% (up .396). Stock Markets took a hit as Italian PM Mario Monti announced that Italy will ask for a bailout. The Spanish PM dodged the question.
Larry's predictions are looking better as both the FED and the ECB refused to print and gold has dropped $18/oz so far.
Thursday, August 2, 2012
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