Wasp in a Bottle.

  Yesterday TMM were trying to write a post and just gave up after rewriting a couple of paragraphs a few times as each sentence suddenly seemed to deserve a whole post. But reducing down the boiling mass of poorly linked thoughts we ended up centring around the idea that until we get the Greek elections out of the way the European function could suddenly move from the melt mode to sideways trading as the "sell" part of May turns to "go away". The bounce yesterday seemed to support that but the new levels of  panic earlier today challenged it, but by no means negated it. Equity markets have rapidly given up yesterday's gains but haven't broken new lows, periphery European bonds are steady and  it really seems to be the mainly the FX market that is shouting and screaming. No change there then.

 With that in mind we are going to stick to our "not really going anywhere for the next 2 weeks" view, so despite spikes of buzzy noise we expect the wasp to be trapped in the bottle. This led us to think that perhaps we should be using this morning's spikes in short term vol to sell it. This train of thought led on- Sell 2 week vol but perhaps buy 1 month for after the election event? For direction as well and in what? Is this for a stand alone trade or a hedge ? Looking at the Greek hedge (garden centre jokes aside) we feel the ultimate explosion in Euro would surely have to be in Eur/chf where, unless the SNB want to become the vomitorium of Europe, they would have to let the floor go at least temporarily. So we either get fancy and sell 2 week eur/chf puts and buy 1 month or we just don't bother and sell eur/chf cash. We then we got distracted and didn't do anything.

Without any new news, the debate is becoming religious over Europe and we do consciously try to avoid religious issues. This is also why we won't be talking anymore about Facebook. Elsewhere it does look as though we are coming to the end of the current supply cycle and the BRICS are losing their mortar as Brazil goes nuts, Russia's without love, speculators bone China and India curries no buyers. None of which is good for the commodity story but we will be posting on all of that tomorrow.

Finally TMM are suggesting that any thoughts of a "Grexit" should be accompanied by those of a "Gerxit". How about the rest of Europe default on everything they owe Germany, kick them out of the Euro and then print like crazy. That's what you do when you cant work out which of two scrapping schoolboys started it - send them BOTH out of the room.

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Stop press- A friend of TMM has just sent in this. We are unsure as to whether it is his own work or an original from the estate of the, very sadly, recently passed away Mr Robin Gibb. Either way, we are very proud to present Robin Van Bee Gee doing the EU-

Well you can tell
By the way I use my fork
It's EU dinner time
No time to talk
Disputes loud , a massive storm
Problems kicked around
Since the Euro was born

They'll say it's all right, it's ok
We'll have more dinner in late May
Bury our heads in the sand
And all come up with diferent plans

(chorus)
Whether you're a Frenchman
Or whether you're a German
The Euro's barely alive, barely alive
Feel the city breakin
And everybody shakin'
The Euro's barely alive, barely alive
Ba, ba, ba, ba, barely alive, barely alive
Ba, ba, ba, ba, barely alive

Bunds don't go low, they just go high
And if they don't do either, I start to cry
Long wings of dollars, in the blues
Buying Facebook Puts, I just can't lose

They'll say it's all right, it's ok
We'll have more dinner in late May
Bury our heads in the sand
And all come up with diferent plans

(chorus)
Whether you're a Frenchman
Or whether you're a German
The Euro's barely alive, barely alive
Feel the city breakin
And everybody shakin'
The Euro's barely alive, barely alive
Ba, ba, ba, ba, barely alive, barely alive
Ba, ba, ba, ba, barely alive