Bank of Canada Chimes In
Everyone from the ECB to the U.K. to Germany to the president of the United States... to Canada... is stepping up to assure us that they're on the case and monitoring markets.
The following statement was issued by the Bank of Canada on its website:
"In light of current market conditions, the Bank of Canada would like to assure financial market participants and the public that it will provide liquidity to support the stability of the Canadian financial system and the continued functioning of financial markets. These activities are part of the Bank's normal operational duties relating to the stability and efficient function of Canada's financial system. The Bank is closely monitoring developments, and will deal with issues as they arise."
Canada? Hey, we've gotta lotta fantastic Minyans from our neighbor to the north so we're not being saucy. We love Canadians! But it's Canada---it's about as laid back and chill as any country in the world. Heck, many Americans sew Canadian flags on their backpacks when they hike through Europe. Canadians ice fish. They play hockey. They're cooler than the other side of the pillow!
So, what's the big deal? Everyone from the ECB to the U.K. to Germany to the president of the United States... to Canada... is stepping up to assure us that they're on the case and monitoring markets. With the DJIA up 8% and Europe up for the year, the obvious question is begged---what do they see?
My hunch is that they "get" the globalized finance-based economy's dependence on credit and they're worried that the debt bubble has cracked. I'm not sure how this jaw-boning will manifest in the near-term (I remain short with stops above S&P 1505-1510 and BKX 111.5) but I will again ask you to remember how long the dot.com bubble took to unwind and how painful the housing path has been.
Given our A.D.D., immediate gratification society, the implications of this latest prick are entirely more profound. And that, I believe, is why the powers that be are wasting no time trying to shore up psychology.
Respect the agenda but please understand the motivation behind it.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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