Oil & Water, Politics & Markets, Euro & Dollar - David Kotok - Like oil and water, politics and markets do not mix well.  And politics are driving worldwide markets.  - Cumberland Advisors
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All Eyes on the Euro - Drop your investment thesis and watch the currency markets.  Nothing currently matters except for the state of the Eurozone and its ultimate resolution - Surly Trader
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CME Absolves High-Frequency Traders in Flash Crash - CME Group, in a detailed investigation into the flash crash of May 6, has put together evidence that suggests that the events might be traced to “divergent trade practices and price protection mechanisms” across the many trading venues that make up the National Market System. - NY Times

6 page CME Report

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With Deal Flow at a Trickle, Rating Agencies Get a New Competitor - by AUSTIN KILGORE - Jules Kroll, founder of Kroll and current principal of K2 Global Partners, plans to shake up the credit rating agency (CRA) sector, with the launch of Kroll Bond Rating this summer. ... go head to head with Moody’s Investors Service, Standard & Poor’s and Fitch Ratings.  His first target: mortgage-backed securities (MBS), a market segment that’s seen one issuance so far in 2010. - HousingWire

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Is the European Crisis Overblown? - ...  I thought it would be interesting to look at VIX action along with previous crises of confidence. ...  I would not be surprised to see the S&P 500 dip down to 1,000, but I do have a hard time imagining  that the VIX will spike to 80% as it did in 2008.  Regardless of this current decline’s magnitude, I am pretty confident that we will see the end of our crisis moment within the next 30 days. ... - Surly Trader

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KLARMAN: MORE SCARED NOW THAN HE’S EVER BEEN - There are a handful of investors who really make my ears perk up when they speak.  Seth Klarman at hedge fundpowerhouse Baupost is one of those investors.  Obviously, Klarman is a reader of TPC, seeing as how negative he has become in recent weeks.  In all seriousness though, the hedge fund legend is very negative. Speaking at yesterday’s annual CFA Institute conference Klarman said:  “I’m more worried about the world broadly than I’ve ever been in my whole career.” - The Pragmatic Capitalist

Bond Vigilantes - A FEARSOME HERD OF TYRANNOSAURUS REX APPROACHES - (deflation - we are Japan ) - ...  I’ve repeatedly shown how there is no solvency risk in a country who is the monopoly issuer of the currency in a non-convertible exchange rate system.   I’ve also shown how large budget deficits are unsustainable (anyone who thinks I am optimistic about the economic outlook is not a regular reader).  But most importantly, the only real risk of large deficits is inflation.   But I’ve also shown that there is no risk of inflation in the current environment.  Consumers are still deleveraging, there is ZERO wage growth, very low borrowing demand, low capacity utilization, high output gap, climbing unemployment, low aggregate demand, low cost push inflation – not exactly a recipe for inflation. ... - The Pragmatic Capitalist
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MUST READ ABOUT RISK:  Land, Labor & Capital May 2010 - plan B economics 
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The Machines That Ate the Market - By Nina Mehta, Lynn Thomasson and Paul M. Barrett  - Once upon a time, human beings oversaw the trading of stocks. They've been replaced by a complex system of computers that can produce a scary new kind of mechanized panic. An investigation into the crash of May 6 - Bloomberg BusinessWeek

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From Market Mania to Depression in One Month - Sean Maher - .... In a few months' time, it's a good bet that the debate will be back to how soon the Fed needs to tighten in a robust US cyclical recovery, China will have begun revaluing, Europeans will be feeling less anguished after a month on the beach (although you won't find many Germans on a Greek one), and 38% of CNBC poll respondents will believe that the Dow is headed to 15,000. ... - Seeking Alpha

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evil speculators - CFTC Set to Limit Oil Speculation With Senate Backing - By Asjylyn Loder - The top U.S. commodity regulator is poised to impose new rules on oil speculators as Congress and the European Commission attempt to rein in trading in the $615 trillion over-the-counter derivatives market. - Bloomberg

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10 Gold Charts Commercial Investment Firms Never Want Clients to See - Smart Knowledge U