The euro will fall apart. That the latest expection form the stock market Guru Felix Zulauf.

You were always a big critic of the euro. How goes the crisis?

FZ: Never have debt problems solved by more debt. In Greece, will play an epic drama. The Greeks are broke, its people and the Portuguese are close.

Who's next?

FZ: Spain is still doing well, but the matter will proceed as in Ireland. The Spainish bonds are priced correctly. The ECB manipulates the rates.

Is that all for the crisis countries?

FZ: No, it is missing Italy. Deposits are falling in their banks. We are experiencing a bank run in slow motion. Banks in Italy and in Spain are being refinanced with more short-term funds. Once the ECB stops being the biggest buyer of  government bonds the yields will have to rise.  It go crazy in Italy this year.

Can the Euro take it?

FZ: No. The markets want a breakup of the euro, with a value loss of 40 to 50 percent in the peripheral countries. The politicians want to save the euro. This is only possible with a weak currency and high inflation.

Newsflash: the crisis has spread to Italy. And it will only get worse at this point as Spain is largely ignored for now (until its own mortgage crisis starts making daily headlines like this one, however, where courtesy of the insolvent Cajas which are simply a GSE waiting to be nationalized, the can will be kicked down the road for at least 6-9 months ) and the vigilantes start dumping Italian debt and buying up every CDS available and related to Italy. "We can't go on for many more days like Friday," a senior ECB official said. "We're very worried about Italy." But, but, didn't Draghi just say Italy's banks will pass the second, "far more credible" stress test en masse? Welcome to the second, and final, part of the European insolvent dominoes contagion, the one which culminates with everyone bailing each other out... and the death of the euro currency of course.

..“In a narrow market, when prices are not getting anywhere to speak of but move within a narrow range, there is no sense in trying to anticipate what the next big movement is going to be.  The thing to do is to watch the market, read the tape to determine the limits of the get nowhere prices, and make up your mind that you will not take an interest until the prices break through the limit in either direction.”..

Jesse Livermore


.."Capitalism works better than it sounds, while socialism sounds better than it works"...


Richard Nixon

.."Just because you do not take an interest in politics doesn't mean politics won't take an interest in you"..


Pericles

.."I never found beauty in the longing for the impossible and never found the possible to be beyond my reach"...


Ayn Rand

.."The financial markets generally are unpredictable. So that one has to have different scenarios... The idea that you can actually predict what's going to happen contradicts my way of looking at the market."..

George Soros