As we pointed out last week, nobody cares about either Greece or the PIIGs any more. The focus among the smartest money out there, in the face of CDS traders, for the third week running, is on the core of Europe, and specifically on the UK. Last week the net notional derisking in UK was a massive $1,063 million in 280 traded contracts, which according to our files is the single biggest one week derisking amount on record. all the Greek "speculators" are now focusing their attention squarely on the UK... and France, which came in second with $384 million in derisking. Incidentally, these two represented the greatest amount of of derisking in all top 1000 CDS reference names (third altogether was not surprisingly Goldman Sachs with $256 million). The bet is now squarely on that the PIIGS contagion will move to the UK, and that France will also not be spared.Despite what you hear about the economy of the US improving it is my opinion that we are not out of the woods yet. Not by a long shot.
If one studies the history of the Great Depression one finds that there were a number of false dawns. The #1 rule of the universe is that if something is unsustainable it will not be sustained.
BTW the comment section at the very first link above is most interesting and amusing. I had more than a few LOLs reading it.