From this mornings headlines:
Spain's economic recession deepened in the second quarter, as gross domestic product contracted by 0.4% from the first quarter and by 1.3% compared with the second quarter of last year. The government has been implementing austerity measures to reduce the third-largest budget deficit in the eurozone.
Spain cannot logically have lower borrowing costs if their economy is contracting.
Meanwhile, borrowing costs fell sharply at a government bond auction of both Spain and Italy.
That means somebody is buying the bonds that have deep pockets, but not normal investors. Why would you want to own them now? Only if you believe you are going to be bailed out later.
Asian stocks ended mixed Tuesday. While Chinese stocks rebounded from Monday's declines, Japanese stocks slumped after the country cut its economic forecast for the first time this year as slowing global growth weighed on exports.
China is pretty much going to lower interest rates and start their own brand of QE, Meanwhile, Japan continues to destroy itself.
European Central Bank President Mario Draghi was supposed to speak at Jackson Hole on Saturday, but he canceled his trip and no one from the ECB's executive board will attend. The ECB has been working on a bond-buying plan to ease the eurozone's debt problems and help trigger growth. The details of the plan, however, have been unclear, as is the timeline for its implementation.
This may be the best news, there is no reason to attend if you are not going to get help from the Fed. The parties to this madness are beginning to look out for themselves and are not trying to hide it anymore. Classic currency war going on.