What’s wrong with this market, I’m often asked.
Rumors…
Today, with 20 minutes left in trading, for example, the Nikkei reported the following, according to Zero Hedge.
- G-20 considering IMF lending program for Europe, according to the Nikkei
- G-20 considering $600 billion IMF lending program for Europe, according to the Nikkei
And it sent the market up.. even after CNBC reported that the IMF denied the rumors.
Yet, morons keep buying the market, thinking all is well. It’s almost laughable… almost.
Yesterday, at exactly 3 p.m. EST, the Financial Times “mysteriously” came up with even more rumors, sending the market rocketing more than 100 points.
According to Zero Hedge, the latest rumor was:
- EU officials are weighing running two rescue funds together, according to FT
- EU is weighing running two rescue funds with motre IMF support, according to FT
- And the EU is weighting giving ESM access to ECB funding, according to the FT
“In other words,” says Zero Hedge. “Europe has now given up on nuances and has resorted to nuclear rumormongering: it is commingling all failed funds, adding the IMF, and promises to add Marsian capital as soon as said capital is discovered. That the EFSF was unable to raise €3 billion (and only did so with underwriters retaining half of the issued bonds) on its way to €1 trillion (let alone €2) remains irrelevant.”
And, of course, CNBC jumped all over it with an “exclusive interview.”
