Morning Update - Tuesday Edition !

Good morning all ! We 're seeing a risk off start - european Bourse are off notably , in particular CAC and DAX. Shanghai and Hong Kong closed for the Lunar holidays but Australia was open - and was off more than one percent and a quarter percent.  US Futures off somewhat , US ten year bond three bps better ,  oil off mildly and gold off 12. Risk of is the word of the morn.Let's examine some reasons that may be the case today ! first item to consider , from ZH focuses on Greece , bit surprise that imminent deal is not exactly imminent after all
   
   

• EURO ZONE FINANCE MINISTERS REJECT OFFER OF GREEK PSI REACHED WITH PRIVATE BONDHOLDERS, ASK NEGOTIATORS TO CONSIDER COUPON ON NEW GREEK BONDS BELOW 4 PCT-EURO ZONE SOURCES - RTRS

What should we take from this ? First , let's walk through the sequencing of events. The Greece PSI talks have been dragging on for months - recall the first " deal " was for a  21 percent haircut  last July , which then changed to a need for a 50 percent haircut , then 50- 60 percent , now it is clear the private investors will have to accept a haircut closer to 80 percent. Last week , we heard the so called negotiator for the Banks , Charles Dallara say on Friday a deal was imminent , there was the predictable ramp up on the hopium or lies - pick your poison. then on saturday , good ole Charles suddenly flew out of town without a deal being reached ! Of course the spin was talks were continuing , a technical team remained in place , Charles was participating by phone - blah , blah , blah.

Now of course we find out a tentative deal was reached between Greece and Dallara , however , said deal was rejected out of hand by the EuroGroup Financial ministers as insufficient to reduce Greece's debt meaningfully by 2020.  So , Dallara's position is that the the offer put forth last weekend ( 4.25 coupon was the offer , compared with EU's demand that any coupon over 3.5 percent would not be accepted ) represented the last opportunity to achieve a " voluntary " deal , the EU veto could set the stage for a Greece default on March 20th as paying the 14.5 billion euro debt maturing on that date simply isn't feasible. Speaking of deadlines , once again they're falling away - the final PSI deal was to be completed by January 30th , now we hear Greece hopes to present its best and final offer to private investors by Febuary 13th ! Any day now expect more rumbling of Collective Action clauses ! By saying an official offer won't be tabled until F

ebuary 13th ( if then ) , there simply won't be time to secure meaningful participation as the process to obtain participation by and between the various private holders of Greek debt is one which takes weeks. Get ready , a default ( most likely a hard one ) is coming. 

PetroPlus, Largest European Refiner By Capacity, Files Bankruptcy

   Another odd item ,  considering the timing of the oil embargo just announced , one would think Governments in Europe would have " encouraged " the banks who had cut of the credit lines of PetroPlus ( which just happens to be the largest refiner by capacity in europe ) , to find a way to resolve these credit line issues - after all , didn't the Banks receive about 600 billion in a three year LTRO and isn't lending actually what Banks are supposed to do ? Well , i guess the real name of the game still remains deleveraging and seizing assets if you're a bankster ! Of course , just looking at the European Banks involved ( BNP Paribas , Soc Gen , Natixis , Credit Suisse , Deutsche Bank , Rabobank, ING and Comerzbank - one understand the need to delever and seize assets as said banks are troubled , to be kind ! So at the end of the day , what's good for the banksters is good for europe , unless one works at the refineries closed or wants to buy liters of gasoline in Europe ! Final piece to ponder , check the item below ! Just simply wow ! 

India to pay gold instead of dollars for Iranian oil. Oil and gold markets stunned
DEBKAfile Exclusive Report January 23, 2012, 5:57 PM (GMT+02:00)

Tags:  India   China   sanctions   Iranian oil   European Union 

Iranian oil for India

India is the first buyer of Iranian oil to agree to pay for its purchases in gold instead of the US dollar, DEBKAfile's intelligence and Iranian sources report exclusively.  Those sources expect China to follow suit. India and China take about one million barrels per day, or 40 percent of Iran's total exports of 2.5 million bpd. Both are superpowers in terms of gold assets.

By trading in gold, New Delhi and Beijing enable Tehran to bypass the upcoming freeze on its central bank's assets and the oil embargo which the European Union's foreign ministers agreed to impose Monday, Jan. 23. The EU currently buys around 20 percent of Iran's oil exports.

What else needs to be said other than China , India , Turkey are blowing off the Iran boycott and continuing to advance their national agendas -  and India isn't being very shy or diplomatic in rebutting the desires of the US and EU. Russia and China continue to provide support and assistance to Iran , therefore other than crush the economies of Greece and Italy , the EU oil boycott of Iran has already been neutered - watch Japan and south korea also work around the embargo as they will take the position that their economies shouldn't suffer when other countries they compete with globally thumb their nose at the boycott . How long will Israel play the game of waiting and watching Iran proceed with it progress in the nuclear arena ? my fear is not too long. Can you say " Other Events " ? Good morning and God speed !