So the great free markets imposed the short sale ban and helped some of the PIIGS’s equities go higher in today’s no volume trading session. All is great, or do we need to start preparing for the cold autumn? The debt situation in Europe is rather chaotic to say the least. Soon we will enter the interesting month of September. Kathimerini reports;

With Consumer confidence plunging to lowest levels in thirty years, expect the consumer driven Economy in the US to seriously start plunging into recession. Yes, SPX has fallen some from the manipulated top, but let’s not forget, many people are still in the money and SPX falling below 1000 shouldn’t be impossible. At least this is what Credit Markets are telling us. Some self explanatory charts below, courtesey Macro Story;

Better late than never….

Ft.com
France, Italy, Spain and Belgium have banned all short selling of financial stocks for 15 days in response to sharp share price falls this week, the FT reports, with the bans to take effect on Friday morninghttp://ftalphaville.ft.com/thecut/2011/08/12/651331/europe-bans-short-selling/

As much as €1bn (£877m) of distressed Irish properties backed by debt from Lloyds Banking Group could be transferred to a new venture with one of Ireland’s best-known property groups, the FT says. The aim is to help recover the properties’ values, http://ftalphaville.ft.com/thecut/2011/08/12/651491/lloyds-to-recover-value-from-irish-properties/

Business leaders’ confidence in their industries and the global economy deteriorated sharply in the months preceding the latest market turmoil, according to the FT/Economist Global Business Barometer. The survey of more than 1,500 executives worldwide http://ftalphaville.ft.com/thecut/2011/08/12/651481/global-business-confidence-slumps/

The Swiss franc dropped sharply on Thursday on speculation that the Swiss National Bank was preparing fresh measures to weaken its currency, the FT reports. The currency lost ground after Thomas Jordan,http://ftalphaville.ft.com/thecut/2011/08/12/651466/pegging-talk-hits-swiss-franc/

Food commodities prices surged after the US government slashed its forecast for the country’s crops due to the impact of a heatwave and drought, the FT reports. The US Department of Agriculture painted a bullish picture in particular for corn prices, saying: http://ftalphaville.ft.com/thecut/2011/08/12/651441/food-commodities-prices-surge-on-heatwave-impact/

North American chief executives and their senior managers are buying their companies’ shares on a scale not seen since March 2009, the FT says. The heads of Morgan Stanley, Chiquita Brands, Generalhttp://ftalphaville.ft.com/thecut/2011/08/12/651431/chief-executives-buy-own-shares-in-droves/

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The Bail outs are back, once again. The risk takers made the bets, took the bonuses and now want the taxpayers to pay for the party. We have learnt nothing, but that is the way people behave. Hudson on the German Taxpayers subsidizing the Bankers;

A bailout, like any other government expenditure, is a tax. Someone must pay all this money. And it is unfair to tax the broad population to pay for a special interest. Instead of being a progressive tax policy, bailouts enable bad behavior by the financial elite, sticking taxpayers with the cost.

Bailouts are unpopular among Europeans who see them as a tax being paid by the population as a whole to financiers at the top of the pyramid. These bankers have lived in the short run, taking large risks of capital for short-term gains to outperform their rivals. It is a game that most individuals have not played with their own savings, and they don’t think that governments should compensate banks for taking these risks.

The bonds in question are held largely in German and French banks in Europe, and by U.S. banks. Germans are especially angry by reports that U.S. Treasury Secretary Timothy Geithner intervened in opposition to the insistence of Germany’s chancellor, Angela Merkel, that bondholders should take a loss on their irresponsible investments. News reports say that as many as half the troubled securities are held by U.S. money market funds or subject to derivatives gambles. So it is not only European banks that are being bailed out, but also risk-taking U.S. speculators.

Full article, click here.

On off on. Short selling ban is back, so the speculators don’t ruin the stability of the financial world. It is always great to read the populist arguments about short sellers ruining the bull market, but as usual, the regulators fail to understand the majority of short sellers are just ordinary hedgers trying to manage the risk. 2008 deja vú is back, and we all know what happened after the first short sale bans were imposed last time, a total freeze in interbank lending. Regulators will try to stabilize the markets, but this will just cause more harm. Bloomberg reports,

France, Spain, Italy and Belgium imposed bans on short-selling from today to stabilize markets after European banks including Societe Generale SA hit their lowest level since the credit crisis.

“While short-selling can be a valid trading strategy, when used in combination with spreading false market rumors this is clearly abusive,” the European Securities and Markets Authority, which coordinates the work of national regulators in the 27-nation European Union, said in a statement after talks ended late yesterday. National regulators will impose the bans “to restrict the benefits that can be achieved from spreading false rumors or to achieve a regulatory level playing field.”

The watchdogs are trying to stem a rout that sent European bank stocks to their lowest in almost 2 1/2 years and quell concern that European lenders may be struggling to fund themselves. Banks’ overnight borrowings from the European Central Bank jumped to the highest in three months yesterday, a sign some lenders may have need for emergency cash. Regulators imposed similar limits on short sales in September 2008 following the collapse of Lehman Brothers Holdings Inc.

Full article, click here.