Market recap: This just in - the European sovereign debt crisis has not been solved. Spanish...


Market recap: This just in - the European sovereign debt crisis has not been solved. Spanish bond yields surged, and markets in the U.S. and Europe reacted with their worst losses of the year. If Spain spins out of control, the worry is the European crisis will mushroom again and we can kiss the YTD stock gains in the U.S. goodbye. NYSE decliners routed advancers five to one.
Comments (11)
  • davidingeorgia
    , contributor
    Comments (2661) | Send Message
     
    Well, thank you, Captain Obvious, for that insightful update.
    10 Apr 2012, 04:19 PM Reply Like
  • youngman442002
    , contributor
    Comments (5123) | Send Message
     
    but he is right...many pundits said it was fixed..all was good..Greece is AOK...lol..right now people should be out of the EU market for good..its toast..go back in to buy up the pieces when it crashes...but it will crash
    10 Apr 2012, 04:47 PM Reply Like
  • Cliff Wachtel
    , contributor
    Comments (1766) | Send Message
     
    been saying it for weeks in my weekly review - obviously nothing solved was just a question of what would be the catalyst for the next outbreak - that's still unclear - bad US jobs reports or overbought risk assets hitting technical levels? gloomy US Q1 earnings? Unclear - once pessimism gets rolling that's all the excuse needed to feel nervous about what remains an utterly unresolved EU SOLVENCY (not liquidity) crisis. ECB LTRO solved temp liquidity issue - which was just a symptom of lack of confidence in EU solvency - that's why no rational person would lend to EU banks.

     

    Not saying anything new here, just reminding readers to keep this in mind when next liquidity bandage & other spin control comes along.

     

    Remember -that which can't be repaid....won't be (See: Greece, Spain...)
    10 Apr 2012, 06:49 PM Reply Like
  • Hendershott
    , contributor
    Comments (1754) | Send Message
     
    OK, so Greece is in a depression and has defaulted on it's debt. Spain and Italy are in severe recessions, along with Portugal and Ireland. With that going on, the US economy grew at a 3% clip last quarter so why the panic? The EU will do more QE eventually anyway because there is no other option.
    10 Apr 2012, 09:05 PM Reply Like
  • slard271
    , contributor
    Comments (64) | Send Message
     
    You're deluding yourself if you think the US economy is any well off than the rest of the debt laden countries around the globe. We're all in this together.

     

    Liquidity is a band-aid. When investors see through the cloud, it becomes quite irrelevant as witnessed by the decreasing half-life of liquidity injections.

     

    The jig is up.
    10 Apr 2012, 10:21 PM Reply Like
  • Kandiman
    , contributor
    Comments (25) | Send Message
     
    Why do we place so much emphasis on Europe and their activity? All they do is coast along and do just enuf to get by. The USA market is way way too much factored on Europe and should not be by any means!
    10 Apr 2012, 09:40 PM Reply Like
  • slard271
    , contributor
    Comments (64) | Send Message
     
    In a sense, you're exactly right. If the US could just give up all these ridiculous pretenses and provide mark to market prices, we'd again be the hotbed of capitalism. As well we should be.

     

    Until, however, we have central banking interference with markets, we will have nothing of the sort. Mark to market and, while we may have problems in the short term, America will come out supremely ahead. The solution is that simple.
    10 Apr 2012, 10:24 PM Reply Like
  • Tempo Dulu
    , contributor
    Comments (316) | Send Message
     
    the pain never goes.
    10 Apr 2012, 10:01 PM Reply Like
  • valinho
    , contributor
    Comments (25) | Send Message
     
    So many interesting coments about a place so few know about. Lets see how we fare when it comes knocking at our door!
    10 Apr 2012, 10:10 PM Reply Like
  • William Price
    , contributor
    Comments (3) | Send Message
     
    Actually it does matter what happens in Spain and all of Europe. Collectively, it is a huge market. However, most importantly, the US will likely prop up European banks that purchase Spanish debt. We did this last summer and will certainly do it again. It is not in the interest of the current administration nor the Federal Reserve to see a collapse of the Euro. Any problems there will quickly spread to the US.
    10 Apr 2012, 10:21 PM Reply Like
  • CaladesiKid2
    , contributor
    Comments (307) | Send Message
     
    Appears to me there may be knocking at our door now. Stocks cannot long outperform the GDP..... cost cutting has it's limits. Without an improvement in the global economic condition, there is no impetus for improving stock market performance. Market manipulation via QEs will/do and are having a diminishing impact. Perhaps even the equity markets are beginning to see the limits of such profligate 'easing'

     

    The reality is that China economic growth is largely dependent upon exports to Europe and North America. Despite China's accelerating domestic economy, it still represents a minor portion of their production and employment base. With Europe sliding into a potentially severe recession and the US flat lining at best (1.8%?), there is little basis for optimism in China, except for their version of QE which is already generating inflation signals.

     

    So what will be driving growth in equity values? Very little of substance and therefore the potential for a series of disappointing quarterly earnings results.
    10 Apr 2012, 10:34 PM Reply Like
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