There's not much that Macro Man can write that you probably don't already know: markets are completely, utterly broken. Liquidity is nonexistent, in some cases literally, which naturally exacerbates the volatility which we are all observing.
While an RTC II is a welcome and obvious solution to many of the current problems, blaming short sellers and engaging in witch hunts are not. That policymakers seem to be opting for both reduces the integrity of the market.
Macro Man isn't able to write any more this morning, so below he leaves you with the post he wrote yesterday afternoon when it looked like the financial world was going to end (though in many ways, it looks even more so today.)
While it may not carry the immediacy that it had when he wrote it, its basic premise nevertheless applies. It's short and sweet. Enjoy....
"The ECB is a credible anchor of stability and confidence for 320 million citizens of the euro area."
- Jean-Claude Trichet, 18 July 2008
"We have only one needle in our compass. That needle is price stability, our definition of price stability."
- Jean-Claude Trichet, 7 August 2008
Monsieur Trichet: 320 million Europeans say, "Look at the ****ing compass, you arrogant git!"
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