Historic day: This is the beginning of the end for EUROZONE

Greece asks for help, finally: http://www.bloomberg.com/bb/n/aDsod9l4gmBE

Eurozone will not exist in five years time - the headwinds of fiscal deficits, overspending and overleveraged needs to be paid. The bill is arriving just as the world feels the most confident in two years!

Greece is now getting "bail-out" - and this is against both the legal but more importantly the spirit of the Maastricht Treaty. The bail-out will be challenged around Germany, Holland and Ireland - and I find it comic that Portugal and Spain now needs to pay for Greece = Farce! Farce!

I include picture from my screen to put this into perspective when we talk about this end of year: This is Lehman all over for me - I remember LEHMAN turning-and-twisting/lying about how healthy and how much progress they made. History has shown they deceived everyone and like Greece was outright liars.

Justics will prevail - maybe not this year, but it will. I end with one of my "own" qoutes:

Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing had happened.  ~Winston Churchill

Winston

Click on chart for bigger version

Quick-update

Just back from having been stranded courtesy of the Icelandic - First they overleveraged and now they disrupt traffic - not easy...

Been very light on trading as I have been waiting for the April 19/21 cycle top to potentially form.

Could it be today? Certainly STOXX50(Europe) turned below its 21 -dma today indicating some top and advance/decline also fading..


Themes right now:

1. Greece and more importantly contagion to Portugal (hit +179 bps over Germany today)
2. Timing of bail-out for Greece (and airlines industry) - the higher the spread goes the faster Greece needs the money + it adds to "minimum" price as no one is supposed to lose by supporting Greece (i.e reference to press conference two weeks ago)
3. Obama and US law makers financial reform bill. The banking industry was hated up until last week - now people wants BLOOD - Yes, there are beginning to be blood in the in street now - watch this play out... 
4. Mid-term election positioning has started - First rush: Who will make and take credit for TOUGH LEGISLATION on banks?
5. Timing - its too early to call for any sort of top, but on the other hand this time period is either make or break - if we "survive" next 48 hrs we will see 1250/1300 if not... a new paradigm is in town.

Positions: Add to Gamma long downside in stocks. Biggest VaR options on EUR downside.

Everything is up except Bob - sorry the EURO...

Sort of strange market this a.m, with EUR under pressure while stock market is making new highs - so not only Gold but also EUR is at odds with its long-term correlations... of risk on and off - either this means EUR situation getting more serious, and hence a need for further correction - or it is symbol of further rotation into the US away from Europe?

Either way we took out 1.3450 ish and saw new lows in this cycle - last move came on Fitch downgrading Portugal.

http://www.marketwatch.com/story/portugal-downgraded-to-aa-by-fitch-2010-03-24?siteid=bnbh

Morgan Stanley seems to think this is the start of further erosion of developed market vis-a-vis EMG:
http://www.businessinsider.com/morgan-stanley-developed-nations-will-have-sovereign-downgrades-2010-3

Another game changer 10yr vs swaps below 0:  http://ftalphaville.ft.com/blog/2010/03/24/185091/new-negative-territory/

Our models performed like this:

Inflation: - 30 bps (MTD: -30 bps)
Benchmark: +39 bps (+67 bps)
Inv. Bk 60/40: +30 bps (+67 bps)
Doom-and-Gloom: -88 bps (-225 bps)
Macro Old Style: -24 bps (-179 bps)