By John Galt
December 29, 2011 – 05:25 ET
There is nothing Santa can do now but go home to the North Pole and melt the ice with the good Mrs. now, as the markets are totally focused on the reality of the PIIGS problems once again. The Euro is hovering and barely holding the 1.29 level as I type this, gold is moving south once again preparing to make new lows, and the yields on the 10 year Italian bond is well above 7.00% once again as displayed above.
The only question now is will the S&P 500 stay negative for the year or will the manipulators paint the tape one more time today and tomorrow.
The big question to this commentator is will the Greek 1 year yield FINALLY close above 400%:
My money is on no at the moment but if I’m wrong 2012 will start off with a resounding “thud” instead of the bang many bullmeisters wishcast for. Today look for a slow market unless the Euro breaks below 1.2870, in which case the S&P should decline another 0.3 to 0.5%, possibly a bit more. Gold will definitely move down over 1% if that level on the Euro is shattered also as the desperation to raise cash spreads throughout the hedge fund industry in anticipation of a deflationary disaster in early 2012.
Buckle up for a fun filled 48 hours of thin volume and insanity as the children still control the keyboards on Wall Street and the adults are not pleased with their performance since Tuesday.