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Fleckenstein: The Stock Market Is A Farce And The Spanish Bailout Was An 'Airball Of An Idea'

Bill Fleckenstein

King World News interviewed Bill Fleckenstein, president of Fleckenstein Capital, on the markets after the Spanish bailout, which he called a "complete airball of an idea."

The stock market is kind of a farce, which is not to say that stocks are uniformly expensive because lots of them aren’t.

So I think there’s a lot of fluff in the S&P.  But the fact that the market is not hugely expensive is why it seems somewhat impervious to some of this bad news.  Plus, when you have these algorithmic trading programs on the loose, trying to ferret out what the market might be telling you is next to impossible.

Fleckenstein stated in an article with MSNBC last month that "nothing will change unless change is forced upon us by a crisis." He expanded on those thoughts in his interview with KWN.

Similarly, all of the city, state, county, and government debt that we have, because the debts and contingent liabilities grew large through 15 or 20 years of money printing, has created much bigger problems.  This is a long way of saying, it’s not just the bubbles that these idiots produced that caused the problems, it was (the fact) that nobody focused on the long-term issues during that period and everything just got worse.

In short, Fleckenstein thinks the focus should be on the long-term and not the ups and downs of the stock market. Figuring out where the stock market is going to go is extremely difficult, if not impossible as he notes, but building and planning for the long-term certainly can be done.

Read more at KingWorldNews.com.

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Meet Alexis Tsipras, The Youthful Greek Leader Who Terrifies The European Financial Elite

Alexis Tsipras Syriza

ATHENS, Greece (AP) — Alexis Tsipras has rarely been on good terms with Greece's establishment.

During high school, he was a leader in a student protest against education reform that shook the conservative government of the early 1990s, appearing on television as a confident 16-year-old spokesman for the movement.

Two decades later, he's rattling Europe and the world economy as he campaigns to become Greece's next leader with a simple if startling pledge: to tear up a multibillion-euro international agreement that bailed out Greece as it hurtled toward bankruptcy.

The extreme left-wing Tsipras believes the budget-cutting imposed on Greece, which is suffering through its fifth year of recession and an unemployment rate nearly 22 percent, should be cancelled. Global financial markets are on tenterhooks over a possible victory by the tough-talking 37-year-old, who dresses casually and has a portrait of the Argentine revolutionary Che Guevara on his office wall.

European financial leaders quickly put together a plan to rescue Spain's banks over the weekend in part to try to limit financial fallout from the Greek election.

Tsipras' radical agenda scares even many Europeans who have railed against austerity. And if he's given the power to carry it out, Greece may soon find itself kicked out of the euro common currency.

Opinion polls now put his Tsipras' Syriza party, which long struggled to win seats in Parliament, in a dead heat with the once powerful center-right New Democracy. The election is June 17.

Greeks deserted mainstream parties in May 6 inconclusive elections after the country sank into a government-debt crisis that forced draconian spending cuts. Even low-income pensioners and minimum wage-earners have been forced to make sacrifices.

"The rotten and reliant establishment is making its last stand. Their dominance is ending after they looted the country and saddled it with debt," Tsipras said at a recent campaign appearance.

Friends describe him as down-to-earth and committed to change. He is Greece's first major political leader to be born after the fall of the country's 1967-74 military dictatorship, which ended decades of political turmoil. He grew up in an era of unprecedented political freedom in Greece, without having experienced any of the harsh polarization between left and right that marked the country since the mid-1930s.

"He has played a big role in the party's (success), mainly because he's a politician who does not keep his distance from people," ranking Syriza member Sofia Sakorafa told the AP.

Sakorafa, a longtime javelin world record holder before going into politics, said she was impressed by Tsipras' ability reach out to voters.

"He can talk to people, and he is genuine. He wins them over with the truth as he believes it."

Rarely seen wearing a tie, Tsipras has broken the mold of the Greek career politician. Unlike many of them, he isn't linked to one of the country's powerful families, and during the crisis he hasn't been seen as being out of touch.

He has been riding high on a wave of anti-austerity sentiment that has swept the country as deep spending cuts have eaten into health care, salaries and pensions, sent the unemployment rate soaring and forced tens of thousands of businesses to shut down since late 2009.

Despite two international rescue loan packages, Greece has been unable to pull itself out of its debt crisis, leading the heads of all the main political parties to argue for some form of renegotiation to the terms. But it is Tsipras who has the most radical approach, saying that simply extending loan repayment times or slightly tweaking targets will not work. He wants the terms cancelled.

But while the iPad-tapping, football-watching civil engineer has youthful appeal, not everyone is buying it.

A growing number of political opponents have a different description for him: an irresponsible populist, whose disregard for basic monetary arithmetic could nudge the country into financial oblivion.

"Syriza is selling the public a fairytale with populism and propaganda of the worst kind ... pretending they can solve the country's problems with a magic wand," Theodoros Pangalos, deputy prime minister in the previous Socialist-led government, told private Real FM radio.

Mainstream parties and market analysts insist Tsipras cannot shred Greece's deal with 16 other eurozone countries and expect to remain in the single currency for long.

"(His) views only have appeal because of the exceptionally difficult circumstances this country and its people are in," Pangalos said.

Syriza came second to the conservatives in May 6 elections that failed to produce a government, winning nearly 17 percent of the vote and increasing its support four-fold.

Polls before a two-week pre-election ban projected Syriza's support could have surged to as high as 30 percent, with the race between Tsipras and the conservatives polarized by the crisis. Most have him neck-and-neck with the conservative New Democracy party.

Greece's €240 billion financial rescue from the EU and International Monetary Fund came with harsh conditions that have caused a dramatic drop in living standards as an average of 900 people have lost their job per day.

The country, Tsipras argues, is now trapped in a revolving door of debt, with banks recovering their money from new state loans from the EU, which steadily add a burden on ordinary Greeks, depriving them of wealth and services.

"Bankruptcy is not when the bankers have no money ... Bankruptcy is what we are living through today, it is the destruction of pension funds, it is hospitals running out of money and medicine, it is schools with no books and children who arrive hungry in the morning," he told parliament in February, when lawmakers slashed the minimum wage and other benefits to secure a second massive rescue package.

Fully named the Coalition of the Radical Left, Syriza is an amalgam of small and often fringe left-wing groups and has its roots in the Euro-Communist movement of the late 1960s. It is led by a party formed in 1991 that split from the hardline Greek Communist Party, or KKE, following the collapse of the Soviet Union.

As a teenager, Tsipras briefly joined the KKE youth.

Since the last major split in the Left two decades ago, Syriza has been a magnet for left-wing intellectuals unable to stomach the KKE's unconditional opposition to the European Union. Politically, however, most have spent their careers in obscurity.

Until now. At a recent campaign event, camera crews from around the world packed into an arts center where Tsipras spoke, as supporters chanted "The hour of the left has arrived!"

Embassy representatives from Cuba, Venezuela and France were present, as Syriza listed each of its campaign promises to loud applause: Axed benefits will be restored, troops will come home from Afghanistan and other overseas missions, police will be banned from using tear gas at demonstrations.

If he wins on Sunday, Tsipras left little doubt over his intentions.

"The first act of the new Left government, immediately after parliament is formed, will be to cancel the bailout terms and the laws passed to implement (austerity)," he said.

"People should remember that Greece is still a democracy: The voters elect their representatives, and they exercise their sovereign right to pass the laws of the land."

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The Weekend Is Over, And The Euro Surges To its Highest Level In Weeks

Following the Spailout, the Euro has surged to its highest level in weeks.

You can see the spike EUR/USD via FinViz:

Image

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