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For you collateral nerds…

Here is the ECB statement on its new collateral rules.

Sarkozy: Read my lips, no new taxes

• Economic crisis stopped him from scrapping 35 hr workweek
• Unemployed must undertake vocational training to receive benefits

Who could have seen this coming?

Me.

Glad I bailed when I did…

US wholesale inventories rise 1.3% in December, more than expected

Why should you care? Because inventory builds add to the GDP calculation…

A little Greek bailout trivia

EUR/USD continues to trade firmly amid hopes that the Greek’s have finally been able to strike a deal between the troika and with private-sector bond holders.

We had similar euphoria back on October 26 when the euro zone struck the original terms of the second bailout. When did EUR/USD top out on that run? October 27.

There was a huge short-covering pop on the 27th, to be sure, so be very careful before wading in on the short-side. It could happen again given the market’s big net short position.

I’m just sayin’…

 

Papademos: Agreement reached on austerity with party leaders

It’s official, at long last.

Did Draghi set the stage for an ECB contribution to the Greek rescue?

It seems so. His last statement of the press conference implied that the price at which the ECB transfers its bond holding to the EFSF is the issue, not the transfer itself.

If it transfers the bonds to the EFSF at a loss, it is a monetary contribution to Greece. If they transfer them at a profit, it is a distribution to member states, which the ECB does annually.

Sounds like he has set the stage for shedding the Bank’s Greek bonds but it all comes don to price.

EUR/USD runs into central bank sales again

Looks like China (or someone similar) continues to massage the market, selling the rallies and buying them back on dips for 75-80 pips at a clip. Nice work if you can get it…

Talk of 1.3325 and 1.3350 barriers in play, for what it is worth.

1.3315 the high. We trade now at 1.3278.

No trade off between interest rate changes, LTRO: Draghi

• Two different things, address two different problems
• On Japanese interventions, should be done in mulch-lateral framework, not unilateral
• Irish government should be praised for reform progress
• “Greece is unique in everything”
• No stigma on use of LTRO facilities
• If ECB give money to EFSF, that is monetary financing; if it gives part of its profit to governments (EFSF) that is not monetary financing  (got it? )

Drgahi: Fiscal Compact a meajor event

• Governments give up partial sovereignty on budgets
• A sign of commitment to the euro; makes euro a strong reality
• A first step toward fiscal union
• In union, each country would be responsible and strong
• A Plan B on Greece means defeat; no comment on ECB holding of Greek debt