So I was out of touch for seven hours or so. I check in with the news sources just now on all the stories that matter. Unbelievable how much things have changed in a third of a day. Even more unbelievable is that all of the news is good.
First of is the No Fly (“NF”). Jim Cramer said on the TV the other day that as soon as the NF is announced, it is off to the races. The NF means that all that Libyan crude and gas is coming back on line in just a few days. Any supply issues that were nagging the market have been relived by just the news. Oil should be under 90 and headed to 80 in just the next few weeks!
There is also very reassuring news on the Japan nuke front. None other than the leader of the free world has spoken. Obama has made it very clear that there is no risk of radiation on US soil. From Hawaii to Guam and Samoa. From Alaska down to the coast of Mexico. Not any place where the American flag flies is there ANY risk of exposure that would/could have a medical consequence. This is very reassuring news. There is no risk what so ever to America. None.
Important developments at the failed nuke site. There are now 300 hundred people attempting to deal with the problem. As one news report highlighted this is a 600% improvement in just 24 hours. Clearly progress is being made.
We now have fire trucks on location that are able to squirt water on the stricken reactors and storage sites. I was not aware that this technique could be so successful. Apparently putting out a 3,000 degree fire of boiling spent rods is not as difficult as first thought. Even better is the helicopter. The pictures I saw showed that the Huey was able to drop the water with pinpoint accuracy. Not a drop was wasted. What an elegant solution.
The final bit of info that should bring a resolution to the nuke problems is that the French have airlifted in 100 tons of boric acid. Just in case that might not prove to be enough the S. Koreans are sending another 56 tons. Problem solved.
Once again I am surprised. I thought boric acid was only useful for killing cockroaches. Some say it can be helpful with a yeast infection. But now we know that old-fashioned 20 Mule Team Borax is all that is needed to absorb any unwanted radiation.
The now, more than adequate, water supply coupled with the magic of borax creates the favorable status that bankers refer to as “Two ways out”. Lawyers think of it as, “Belt and suspenders”. There are options, there are solutions, there’s little risk.
The final bit of data is that the G7 Central Bankers are now acting as one in coordinated global currency intervention. This truly is good news. The steady hands of the central bankers have eliminated downside market risk. With the risk now behind us only the upside is left. The Yen carry trade now has the blessings of all those well meaning central bankers. We know how powerful a force this can be. This is the “stealth” QE3-4 that Bernanke desperately needs and wants. The circumstances will give him good “cover”. When global inflation ratchets up again as a result of the Free Money Card from the G7 Ben can say, “Don’t blame me. It was the other guys that made me do it”.
A look at the latest “smart thoughts” from virtually every financial institution and TV talking head is that the tragic events of the past few weeks can lead to only one conclusion. Global growth is about to explode. Yes there may be a hiccup for a bit, but the future is as bright as it has been for some time.
Not one fucking word of this is true. It will take years for those nukes to cool down. There is more risk in front of us than behind. The resources being brought to bear are inadequate. There is no quick fix, including borax. I truly hope the winds will always be favorable. But that is just a hope. If the citizens decide they want to be at least 200 miles away it would have major consequences to the capital and the country. There is no Japanese growth story until the nuke issue has been resolved.
In a few hours NATO forces will take out the airports and anti-aircraft installations in Libya. I have no doubt that they will control the skies. But they will not strafe forces loyal to Ghadaffi. They will not put boots on the ground. The civil war in Libya just got notched up, not down. Where is the next NATO No Fly? Jordon? Syria? Bahrain? Algeria? How about Iran? A few big protests over there and all we have to do is send in a carrier or two and do the No Fly?? We shall see if this leads to stability in the ME. I see it is as an act of desperation. One that will bring significant negative consequences.
The G7 lit a fire tonight. I think this was also an act of desperation. When markets don’t do what they want Central Bankers come to the rescue. They fix the markets. Just like that. They buy stability with printed money. And they tell you there is no cost to it. Simply not true.
Those bankers that are spinning a tale of upside opportunity are an interesting part of the mix. You don’t normally see them coming out of the woods together like this. The noise from the “good news” boys seems a bit too orchestrated for me. One thing that may be a factor is the calendar for new issues, secondary’s and big syndicate bond deals. There is a ton of paper that wants/needs to get sold. It is sitting on the shelf waiting for a window. Those bankers have a good reason not to rain on their parade. But really, how can they be so confident when there is so much uncertainty?
Sorry for the rant. I’ve been around for a bit. I’ve always made note of the events that shape us. Never in my life have I seen so much spinning and manipulating. It is coming from heads of state, government officials, central bankers, commercial bankers and the press. It will be interesting to see how long the spinning and manipulating will work. Not long is my guess.
Spin, Spin and more Spin