Viva Cuba

Greece and Italy will only qualify for new money from the EU and IMF if the governments reduce employment by over 200,000 combined. Presumably these will be living civil servants. The popular unrest will be measured in bottles of ouzo.

The US president plans to save $3.1 trillion by walking swiftly out of two wars ($1.1 trillion), increasing tax rates for earners in excess of $1 million, closing loopholes for income between $200,000 and $1 million ($1.5 trillion), and reducing entitlement spending for the balance. A strategy to insure the ire of all constituents and a new low in economic thought.

The Fed bereft of new monetary ammunition intends to make do with what it has in operation Twister, rolling $20 billion a month in maturing treasury notes into long term bonds at a rate that will insure the Fed holding 70% of the long term inventory.

Enlightened minds perched on economic bar stools believe that Twister will add .4% to US GDP (or the equivalent of 6% growth in India) and add 350,000 jobs. Sober patrons think that the only addition to GDP will be roughly $100 million in fees to the Street for executing the roll which will promptly be spent at Harrys.

The Chinese are loafing through this intellectual wreckage collecting mineral rights and offering a few billion here and there to insure demand for Chinese food in recipient countries outpaces McDonalds but more importantly to camouflage the $1.7 trillion lending bubble in its provinces.

Denial, economic contraction, and unemployment tend not to increase asset prices that are the collateral for bank and government balance sheets to engage in continued folly.

To wit the seers at OPEC have opined that anticipate demand for its wares are less than expected fearing prices closer to $50 than $150.

Sip Havana Club at sun down in the only civilized bastion left in the western hemisphere

Viva Cuba