Pride goes before the fall

The stock market closed up over 300 points today. The headlines soared!

STOCKS: Best Month Since '74!
'Largest percentage gain in quarter century'...
Partying, But Hangover Tomorrow?

S&P 500 Extends Best Month Since ’74, Euro Rises

Stocks surged, extending the biggest monthly rally for the Standard & Poor’s 500 Index since 1974, and the euro strengthened as European leaders agreed to expand a bailout fund to stem the region’s debt crisis. Treasuries sank, while metals and oil led a rally in commodities.

 Apparently all the jubilation was caused by the news that the EU had reached an agreement to bailout Greece and save the union. Of course, no one is really speaking of the deal for what it is and what it truly represents. 

The EU has forgiven 50% of Greece's debt, which is conservatively over 100 billion euros and they have sweetened the pot by floating them another advance for yet another 100 billion Euros. Most accountants would call the first part of the deal a structured bankruptcy and require the one bankrupting to be devoid of credit for at least seven years. But in this instance, the EU simply extended the credit limit of the Greeks and all of this is somehow supposed to stave off a complete collapse of the Euro.

I am no economist, but I say, don't count on it. Something tells me that this is a stop gap measure much like the little boy with his finger in the dike. The big burst will still happen. They may have postponed it, but it is coming and when the dam finally does break, it will devastate the whole of Europe and the UK and the Tsunami that it causes in the global markets will wash up on our shores in less than twelve hours after the collapse.

Happy days are here again!  Not so fast folks. These people are dancing on quick sand and they don't even have the sense enough to realize it.