Monday, October 24, 2011

The EU and Attitude

We told clients on Oct/9 and again Oct/15 to expect progress towards a solution, that EU leaders were on to something and that - key - the market crowd would come to agree. Clients were then not to set trades which would benefit by the way of disappointment. There were no odds in such of move.

Timidity, half measures are corrosive but this has not been lost on EU policy makers; they have known that for goodness sake; this is not just the stuff of critics. But suddenly, late Sep they realized they’d approached the point of no return. There was a sea-change in attitude then when policy makers came to understand the wisdom of Ben Franklin, that they had better pretty quick find a way to hang together, or they would all go down together.

And of course we know that the tools have been there all along. We’re not smart enough to know which will be chosen but that doesn’t matter for our purpose. It was only sensing the change in attitude and intent ahead of most others which mattered for our clients.

Irish Prime Minister Edna Kenny, in today’s WSJ, "For the first time, I found leaders of the Eurozone focusing on the fundamentals here in respect from the situation arising from Greece and the fear of contagion. There was clearly an understanding the world was watching and there wasn’t any point in doing this in a half hearted fashion."
 
Indeed.
 
Robert Craven

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