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Tuesday, September 27, 2011

Rumours Feed Markets - The End is Nigh

The European Investment Bank has stated the following today:

There have been media reports about a potential involvement of the EIB in a special purpose vehicle in connection with the EFSF, for the purpose of bailouts.

The EIB has not been approached and has no plans to be involved in this.

The EIB will continue to focus on its mission which is financing viable investment projects."

Why did these rumours start, and what purpose do they serve?

Markets have rallied briefly, in time for the month end, useful for traders et al looking to show a "good" month.

Those who doubt EIB's rebuttal, re read the last sentence:


"The EIB will continue to focus on its mission which is financing viable investment projects."

No one on the planet can call Greece a viable investment.

In fact Valor Economic reports that Brazil is now preparing for a Greek default within the week.

"Something must happen. Greece is a few days [from bankruptcy]" said a high official source."

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