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Thursday, September 22

22nd Sep Early - Waking up

Summary: After the FOMC everything back to risk-off. The Fed did little, and all of it and more were already priced in. I put all Fed-related links to a dedicated post, as the event is of great interest to some, and the rest could not care less, here: Super Fed Aftermath.  I also updated UBS rogue trader and the What happens if Greece defaults? is still there, if you haven't noticed. Leave a comment, follow me on Twitter or email me.

News roundups Wednesday early Between The Hedges and late Between The Hedges

Vols, Risk Reversals & Pin Risktradingfloor
FX option vols 22th Sep 07:00 GMT

EURO CRISIS
** Maximum Intervention to take us to Crisis 2.0tradingfloor
possible next steps: extension of Greek debt, Fed indicates nominal inflation and unemployment targets, SnB raises EURCHF floor to 1.25, European Monetary Fund. But one more huge crisis, with a mother of all risk-offs could be required before the willingness to solve comes.

**Bundesbank ready to pull the Euro’s ripcordLighthouse IM
Two Germans leaving ECB – are they leaving the euro? Interestingly, during the cold war Germany had billions of banknotes with new design in case Soviets would have flooded them with counterfeit money. The Germans are probably prepared for the breakup now.


Marco .. Marco … PoloEconoMonitor
Europeans are more happy to listen to China than USA. Just because China would more probably put its money where its mouth is.

Meet Greek Austerity...At Long LastZH
Some serious cutting of pensions. Ridiculous and unbelievable that this comes so late in the game – and maybe too late.

Greece will get the next tranche of fundingeconomistmeg
Meg believes that if Greece plays nice and does not resort to playing the chicken, funding till December will happen, but at that point all bets are off.

The IMF can make your €200bn capital hole disappear in days! alphaville / FT
They managed to put something nasty into their report, even given the loud political opposition frm Europe.

Italian Government Debt Faces Paradigm ShiftThe Source / WSJ
ING bank selling Italian bonds, ECB’s bond purchases provide opportunity to lighten

OTHER** If Rational Capitalist Speculator Were A DictatorRational Capitalist Spectator
Cut defense (=war) spending by a third, raise rates, reinstitute mark-to-market, destroy abandoned homes, raise taxes on capital gains etc etc.

The Biggest Bubble of All Time: Commodities Market SpeculationEconoMonitor
Argues that the slowdown will hit the prices soon.

China CDS Spikes To Highest Since MAR09 As PMI DisappointsZH

How Long Can Japan Play The Endgame?ZH

Moody’s Cuts Ratings on Three Big BanksDealBook / NYT
Boa, Citi, Wells Fargo

The Danger Zone: Financial Stability Risks SoariMFdirect

** “Why I’m An Austrian In Economics”The Daily Capitalist
Economists should be more humble. Uncertainty is the only given, large buffers are needed but regulation gives a false sense of security.

Jim Chanos: China Has Tons of Contingent Debt Via State-Owned EnterprisesEconoMonitor
Chinese true debt is at European levels or even worse, property bubble. He is long casinos, his “long corruption / short property”-trade.