Buy dips

[TheRightSide]

The unlimited lending by ECB to European banks for 3 years at 1% is very positive. The Banks can buy 6% sovereign bonds & thus earning 5%.

This is good for shares, a Christmas rally might emerge.

 

[notting]

It is good for short term shares.
The only scarry part is when they try to sell their sovereigne bonds!
Or they just use the money to recapitalize their own balance sheets and leave the bonds alone.
That'd be smarter after what happened with Greece!

 

[Starcraftmazter]

The unlimited lending by ECB to European banks for 3 years at 1% is very positive. The Banks can buy 6% sovereign bonds & thus earning 5%.

If you have been following the news, the banks are not doing this - and in fact they are selling PIIGS bonds.

Did you really register just to post this?

 

[TheRightSide]

Some banks were selling bonds before as far as I know. Now that with more cash, they don't need to sell bonds in a hurry, that is good for the bonds. With more confidence, some might even buy the bonds for pocketing the difference.

 

[skc]

With more confidence, some might even buy the bonds for pocketing the difference.

Yup. If only MF Global could hold on for another 2 months... their trade is being bailed out softly softly.