USD

This is a fundamentals discussion Subz. Please offer up your fundamental reasoning :-)

I know you understand it all Cat, the link was for everyone else :-) And there are choices to be made, all bad choices :-)

In his eloquent letter, Papandreou boldly stated that, in essence, Greece is no longer prepared to make further concessions and will thus blow up Europe's financial system if it is subjected to any more pressure. In other words, it is now time for all additional concessions to come from the side of Germany, the ECB and the EU. The willingness of Papandreou to speak so boldly is hugely important since it marks a recognition by the debtors that they now have the whip-hand in these negotiations. The Greeks (and Irish) for some reason failed to realize their power last year, but they do now. This transforms the balance of power in the negotiations. As a result, Germany and the ECB have reached the moment of truth either they comply with the debtor countries' demands or they abandon the euro. This ultimatum probably helps explain why the euro has been so weak and why it should be heading even lower.
http://www.johnmauldin.com/frontlinethoughts/back-to-the-basics

This week's letter from JM touches upon europe but focuses mainly upon US debt and thoroughly explains GDP = C + I + G + Net Exports, explaining all the ramifications of playing with this fundamental equation. This is somehing he has written about many times before leading up to the financial crisis. This week puts everything into current context. Recommended reading !

China Daily writes ( not so new)
Liu Jiayi, the country's top auditor, said in a report to the National People's Congress that local governments had an overall debt of 10.7 trillion yuan ($1.65 trillion) by the end of 2010, and some were at risk of defaulting on payments.

The scale, amounting to more than one-quarter of China's GDP in 2010, which stood at 39.8 trillion yuan, raised concerns that local government debt could destabilize the financial system of the world's second largest economy if it is not managed properly.

Although some analysts argued that concern over local government debt was unnecessary as long as the country maintained its rapid economic growth, some international investors have lowered their outlook on China's long-term local-currency rating.

Leading rating agency Moody's said on Tuesday that China's local government debt could be even larger than the official number, which may set off loan defaults.

Since China reportedly bought Jap sov bonds I come back to the idea of going long USDJPY
@78 that level was not hit yet.

It pains me to see such a great nation (and world leaders) on the path of self destruction. We don't see much frustration from US traders in this forum but other american traders I have got to know over many years are immensly frustrated with the last 10 years of administration in their great country.