S&P was down most of the day on fears of a Greek default (the same Greece we have been told several times is too small to make a difference). But wait! about 10 minutes to close it makes a maddening dash into positive territory. What happened? Did P&G revise earnings upwards? Did GM sell more cars? Did Pfizer announce a drug to cure hair-loss?
...and the answer is...U.S. Stocks Gain on Reports of Italy China Talks
Could this be true? Could this crisis just require a wink from the rich Chinese? Of course, the "reports" say nothing about who said what or, more importantly, how much would China invest in Italian bonds. In fact, they could buy them in the market without telling anyone and get much better prices.
In case you have been absent this year, this trick has been used before:
China buys Greek Bonds
China buys Portuguese Bonds
China buys Spanish Bonds
Coming soon: China buys French and German bank bonds. China buys Belgian bonds.
Quantities not disclosed.
“China is a poor country with only $4,000 per capita income. To talk and think about China to rescue countries with $40,000 per capita incomes is ridiculous.”
ReplyDelete-Yu Yongding, a Chinese top economist and former member of the central bank’s monetary policy committee