Wonder Twin powers activate! Form of a money printing press, shape of a distributor of all that money. http://www.timbeaux.com/wp-content/uploads/wonder_twins1.jpg. The DJ is reporting “A proposal that the IMF could call on the ECB to lend it money so it can finance bailouts for euro zone governments threatened with insolvency is gaining traction and if all parties agree, a deal could be announced at the Dec 9th European Union summit, two people with direct knowledge of the matter said.” The story went on to say the Germans and the ECB are “still opposed to the idea but with no other viable alternatives talks could start soon.” The S&P futures went straight up and European bond yields came off their highs on the story and we’ll see where this goes. Spain’s 10 yr however did come within 12 bps of 7% earlier and is still above 6.75% ahead of elections on Sunday. At the end of the day, while the ECB may decide to get more aggressive and the IMF may step up with greater resources, its still a story of just buying time and Italy, Spain and others must still liberalize their economies and spend less.
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