In Zeev's Honor, Plan the Trade and Trade the Plan

[Alex G]

the big money is still on vacation in the Hamptons... things will probably heat up in September


Too Many Questions. Answers Due Soon.
http://www.streetsmartpost.com/2012/08/21/too-many-questions-answers-due-soon/
Tuesday, August 21, 9:25 a.m.

The dog days of August are drawing to a close. European leaders are beginning to return from vacations. Important meetings are scheduled for early September. Rumors are rampant. Opinions are wide-ranging. News is sparse and contradictory.

It’s been reported that the ECB is finalizing a bazooka attack on the eurozone debt crisis that will include placing a cap on the bond yields of troubled members. The report was immediately denied by Germany’s Finance Minister. But the Spanish bond market seems to believe the report, with the yield on Spain’s bonds dropping significantly.

In Asia, continuing indications that China’s economy, the 2nd largest in the world, is coming in for a hard landing has its stock market hitting repeated new long-term lows. Hopes have been high that its government can and will still come to its rescue in time. Analysts are convinced it will. But China’s central bank is providing no hints of action.

In the U.S., the market is still hopeful the Fed will provide another round of stimulus even though there are encouraging signs that the economy is beginning to recover again on its own.

Answers from all directions should be coming soon.

German, French and Greek leaders are meeting this week on Greek’s crisis. Rumors are that some euro-zone leaders would be just as happy if Greece were to exit the eurozone. Others claim such an event would be a disaster.

The ECB’s next policy meeting takes place on September 6.

In the U.S., the Fed’s annual Jackson Hole Economic Symposium takes place August 30 through September 1. Fed Chairman Bernanke speaks on Friday August 31, and it’s widely expected he will provide guidance on whether some form of QE3 will be forthcoming.

With news so sparse in August, the market has been unusually non-volatile and trading on very low volume, conditions that are usually followed by periods of large moves.

Opinions vary on which direction that move will take, but some of the uncertainties should have answers before the month ends.