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Monday, September 19

19th Sep Late – Greek Advent, or Eve?

Summary: The Greek default is now a certainty. Only the timing and the possibility of getting the second bailout tranche are open questions. UBS rogue trader updated. Leave a comment, follow me on Twitter or email me. 

Today’s Headlines – Between The Hedges

FX options 19th Sep 12:30 GMT
Vols, Risk Reversals & Pin Risk –

Credit market overview with good charts and comments

While the fiscal position of many countries was ok before crisis, end result was still fiscal trouble. Risks and sustainability are not captured by simple measures like budget deficits.

Required: credible solution to Europe’s debt crisis and recapitalization of banks

USD basis swap prices already back to levels before Thursday’s annoucement

Not BNP, so either SocGen or Credit Agricole.

No public announcements, decision on payment of next tranche moved to 3rd Oct. Actually, there was an announcement that the talks went great and everything is ok, but nothing..

Default coming, two official denials: “never believe anything until it’s officially denied”

“100% chance of default”
** Preparing for a Greek Default – The Burning Platform

Nouriel Roubini, headline says it all.

Coup is a possibility, but not very probable.

19th Sep speech on Greece

Markets are pricing in further easing, so policy scope is limited.

What’s a Fed to do on Wednesday? – Pragmatic Capitalism

Recent speech by Richard Fisher, President of Dallas Fed
(pdf) Of moose and men – BIS

Show this to the cultists complaining how banks create money from thin air.

Video interview and transcribed text