The T Report – The Day Austerity Died  Posted by on Apr 24, 2012
in Uncategorized | No Comments  Austerity is dead! Long live
Spending!  Futures are up, Italian and Spanish bonds are up, CDS
spreads on them are at least 10 bps tighter, and MAIN is 3 bps
tighter on the day (though I have this feeling I better type
fast as we are starting to fade off the best levels).  Lots of
little things seem to be contributing to the strength, TXU
earnings, no economic data, auctions that raised the required
money, etc., but there does also seem to be a belief that
Germany finally “gets it”. That Germany is finally going to
relent on their demands for austerity.  The first question is
“what is defined as austerity?” Programs that are providing
money today, that is quickly re-circulated into the economy
because it is paying for people to live should not be cut – that
is bad austerity. Raising taxes in general is probably bad
austerity, but what about actually collecting taxes on all those
who have avoided paying what they ow