Standby for a Phony Crisis

Brought to you by hedge funds that are pissed that Argentina (as everyone knew they would) is planning to stiff some hedgies.

Oh, it’s going to be terrible…woe is with us…this is the beginning of the end!!!”

I can hear the hand-wringers already – which is odd when I think about it, because the talking heads of the market haven’t been spun up for the day yet, but that’s besides the point.

One of the genuinely rational reports out there, calling it like it is, is being served up this morning from Heidi Moore’s pen over at the UK’s Guardian website.

Headlined as…

It’s the end of Argentina as we know it, and the world economy will be just fine

An entire country defaulting on its debt? After a fight with US hedge-funders? This is the stupidest ‘nuclear option’ yet”

It’s a breath of fresh air to see that there may actually be more than one rational observer of the world’s careening financial misbehavior, driven by too much paper and too little common sense.

How’s the Hoax du Hedgies going?  A review of world markets this morning should be saved as an indicator of the possible economic intelligence of the various markets around the world.  The smart people have markets going UP while the stupid people find their markets going DOWN is one way to look at it.

Here’s the rundown as of press time:

China is smart.  The Hang Seng was up 24 points.  I guess you don’t get to be a 5,000 year old civilization (which invented paper, remember?) by believing that paper really is value.  No, they’ve figured out People and Resource are the value.  And lately, prison camps and cheap labor, but they aren’t planning on the world ending, just yet, it seems.

Japan was down 25 points overnight.  That’s hardly anything…and this from a country which has 40-years or more of Fukushima clean-up still to come.  Why, you’d think they’d be the easiest to spook, but no.

Europe (UreUp) is a different deal.  Krautenlanden was down more than 1% when I looked.  But there’s a reason built into the psychology of the Germans that can be traced back to the Brothers Grimm.

The French are similarly frightened, down almost 1%, but the Brits who we call the “kneelers” seem to be remarkably sober-minded and not panicking, either.

Wikipedia makes an interesting observation about the Grimm boys:

Some critics such as Alistair Hauke, use Jungian analysis to say that the deaths of the brothers’ father and grandfather are the reason for the Grimms’ tendency to idealize and excuse fathers, as well as the predominance of female villains in the tales such as the wicked stepmother, and stepsisters in “Cinderella”, but this disregards the fact that they were collectors, not authors of the tales

Cristinakirchnermensaje2010.jpgUh, wait!  Did they say female villain?

As in Cristina Fernández de Kirchner, the president of the country that’s stiffed the hedgies this morning?  Doesn’t look so villainous to me…

Oh, sure, Argentina has done this before and no, it didn’t end the world that time, either. Why would now be different?

It ain’t, that’s why!

Forbes has an article this morning that loudly proclaims “Argentina In Default: Everyone Lost, From Cristina Kirchner And Paul Singer’s Elliott To Judge Griesas

Well, hold up there Buckos du Kapital.

Am I the only one that noticed that the Argentine stock market was up almost 7% in yesterday’s trading?

And from lows earlier this year around 5,407, the Argentinian Merval index closed yesterday at 8,937 and change.

That’s an incredible/whopping/ insert your own surprise 65% gain for the (Argentinian) folks down home.  So sorry, hedgies.

This time when Forbes rolls with how dire things are and how everyone lost, I’m not buying it.  And I don’t think you should, either.

But then again, like I said, markets today will be a pretty good IQ measurement if you can step back from it a ways.

More after this…

Markets Today

Smart Money seems to be on the downside for the open this morning with futures showing down more than a hundred on the Dow.  But we expect any declines for the balance of this week to be short-lived and resume upside action not later than Tuesday which is the traditional turnaround day when you get a Thursday-Friday disaster with some follow-through on Monday.

Tomorrow we get the Big Number of the week – unemployment, and that might offer an upside surprise, given the unexpected strength in the GDP report out yesterday.  4% annualized growth is nothing to sneeze at.

Wars of the World

Where to begin, eh, Orson?

Israel is calling out 16,000 reservists to dig up everything that looks like a Hamas tunnel.  Western media are quietly letting on that the Israelis have told Hamas in advance where they’re planning to strike and so Hamas has blood on its hands for not allowing people to move from critical areas.

Then there’s the War with Mexico, which the Washington Cartel is in the process of loosing, especially when you look at it from the US side of (what used to be a) border.   Cartel boss Obama has raided federal budgets to pay for his (however you label it) policy.

The Russian PR machines is running stories like “MH17 Tragedy:  Beating drums for war in Ukraine.”

But, like Argentina, this also comes down to money:  Russia wants to get paid for its natural gas and now that the Kievgov has tossed in with Euromaniacs, the blow-back is no freebies.  Payback’s a bitch, as we know.

The good news, such as it is, is that one of my favorite “deeper thinking” sites, The Atlantic, is out with a story asking  just the kind of thing we were addressing in Peoplenomics and here a couple of weeks back:  “Just how likely is another World War” where they look into the parallels between 1914 and care to guess when?

Californians Dry Out

No, this is not your Lindsay Lohan or rehab story.

Santa Monica is about to join the list of California communities deciding on water rationing.

As this morning’s update Drought Monitor shows, the severity of the Drought is really tightening up and despite a few showers to keep the dust down, there’s a terrible mess and the water main break earlier this week didn’t help, either.

Here at the ranch overnight, just a spit and a promise as showers in Texas quickly left the state for parts east.  Part of the Obama cloud resettlement program?  Hard telling, but sometimes we wonder.

Here, have a trace of barium oxide and don’t think about it too much.