What's Up On Wall Street - Steven Russolillo, WSJ

Gee -- I was still optimistic last night 930 this futures for a 45060. Points. Looks like you have the market's losing steam engine totally out maybe 25 on the down. As this it's a little -- but you know let's not get totally hungry I'm trying not Catholic I'm very. The Dow is up 31 points on his gorgeous Monday -- 500 up two NASDAQ up one point 75. It was a 72 cents to get the ten year US treasuries sitting at one point 627 that's a slight uptick right now on and you got gold thirty cents. At 1590 does not and I'm not complaining. I'm gonna complainant and a complaint to Stephen -- a little from the Wall Street Journal Steven are you doing. I don't -- -- I'm gonna complain as well this is. Is different not the reaction that many were expecting it especially equity the the bailout was announced over the weekend. -- -- -- exactly when on the weekend was yesterday that the -- Spanish bank bailout was announced Stephen. So it was Saturday that the reports started. Started coming out yesterday -- you know the official. Announcement. And you know as you pointed to there was a big pop. Last night but in the futures and beside him. An Asian markets -- European markets as well. That -- quickly stated in and I think the key issue here is that. You know this eighties it was expected that -- that that's some sort of -- it was going to be put in place well for the Spanish banks but. This doesn't this suggest the sovereign debt issues that that's -- Spain and so. The country itself did not get did not get any at any help from the and so. People are worried that deals being being the fourth largest economy in the eurozone. That that that -- -- -- actually need a bill at some point in two busted out of will be. Far more difficult than that that that coming up with any sort of solution for Greece which is a much smaller economies so. That is the key worry right now and so. I think that's plagued the Pristina the rally -- who's credited the scheme here. Actually dealt only a fifteen point eight now looks so. Still a lot of question mark in this routine month for Europe in general because there are a lot of elections that are expected that the the that are. You gotta agree so it yeah I get the Greek elections on Sunday right now. Greece Greece has to be feel like geez what he gave all this money to Spain Huckabee and show us any. Exactly exactly -- it's a great point and so. Depending on how that the vote cheeks that in Greece that there Israel where he picked that victories could end up leaving in the eurozone. You know if that would happen in on the one really knows what's going to happen at this point and so. It is the old cliche is that market he took effect uncertainty and so that which is creating huge if you try to uncertainties. And so. Isn't this a medal by the ECB Steven though that they want Greece to leave. I like I look at it in there. They're they're bailing out the the Spanish banks which saves the Spanish depositors right there so. The position no FDIC insurance so now if you've got your money in Spanish bank there's no reason to take it out in and put it into a German banks so it should stop that flow but. I interpret this as. The ECB saying Greece we would like you to leave please add your election on Sunday and we would like you to lever our mind misinterpreting mean these actions. I don't know that that's necessarily the case I think. The DCB. Last week you know they have that that there rate setting meeting instead essentially kept rates. The same and they and they didn't announce any new bill hospital visit their -- saying you know. These countries need to get there and that -- their act together and and they need to do without us because ECB has already done so much at this point. Very similar to what's happening here in the US so the Fed has done so much this point. The Fed is basically saying. He -- tiebreak he's saying to congress -- you know you guys need to know to something you need to try to pick up the slack here in and do something to to alleviate that that the stress that's going on in the economy and the financial markets and so. I don't know that the ECB is feasting -- -- -- you know we want -- out but. Just so that if that situation worse to color. I think you would see. I think that market to get pretty hairy and we get kind of messy from what we're seeing right now. Dare I ask you about Italy because Italy is also got major problems at their banking system. They didn't have the same -- -- bubble that Spain had that today Italy is also in financial difficulty in meeting of financial assistance from the ECB. Absolutely not I think that that's going to be news going to be the next. Country here that's gonna hit the headlines you know I feel so much attention focused on Greece and Portugal. Balance Spain and -- the next domino appears to the Italy. Which is I mean it's scary proposition because it's. We you don't know when this is going to and that all what is immediately but on this -- That is the big -- Radio Free Europe and so. You know is it to the markets credit I mean you know the stock or without. Four days in a row heading into today now if these negatives -- But. It just seems like. You know even amidst all this you know the market five week was intrigued but still hasn't had the BB correctional a lot of people. Anticipated with Europe getting worse so you can you can interpret that two ways one you could say okay now setting up for a big -- or you can interpret as saying no. -- maybe the mark has been a little bit result in here. I don't know that I want to pick other side of the -- but I think that. It's just it's at least this is the key military now and his texting because when you go into this summer months are -- are relatively quiet time for market -- I'll see you at that that's the financial crisis it's been anything but at. Seems like we're shaping up again for another. There's tumultuous summer. Stephen how much pressure do you think Wall Street and not not so much Wall Street but Washington DC is putting on the ECB I mean -- It Barack Obama if he if Europe doesn't settle down at this problem gets worse between now and November the worse the economy is the worse it is for the incumbent. And Europe's problems are in fact falling over here in the United States I've got to believe the president Barack Obama. Is putting a tremendous amount of pressure on his European counterparts to get their economy again. Oh absolutely and we needed to their impromptu press conference that Obama called on Friday is I think just such a clear indicator that. You know he and and Tim Geithner and a lot of other guys here are are basically in the ears of a lot of European officials saying well and get your act together now immediately don't waste anymore time. But of course these -- that has been -- -- -- for -- that Clinton and and the you're European company it would get their -- Yet you're right because that the worst -- situation gets its going to spill over into the US of course the US gets. That is clearly not a good -- prefer Obama heading into the elections so. You get there there is definitely a huge incentive on his part to definitely. Be calling for her very European leaders to really take more action and take more action sooner rather than later. And I think that the Friday press conference was such a clear indication that because how often you have the president. He'll hold a press conference. And an unscheduled press conference like that and really to -- such -- spending -- 5% of of that the conference talking about how Europe needs that. Two more -- it was just it it was quite a scene on Friday and down. You know I think the -- the markets reacted positively have started because it's -- to put more pressure on it's to get this the Spanish bank to get something announced over the weekend. Hey you Stephen may be worked maybe they would over the presidency d.s in this -- -- ticked off. And Andy and perhaps you know Europe is a socialist part of the world right so they'd rather have a guy like Obama in office than a guy like Romney the -- they may be looking at it insane. They would rather do business as Europeans to remember your -- just neglected a socialist French president. -- -- Mitt Romney is not their cup Petit. Had confessed that the. That's very true and you know -- that's if that's what it's gonna take to get them to move. Yeah I mean that that would that would be excellent because that would make. Our lives -- Make our situation a lot that are over here so you know time will tell. But. Unfortunately I think the reason why you're getting to and not -- positive reaction not just a big -- today is that people just are not. Really optimistic that that any sort of announcement that -- can control Muppets really going to be a game changer I mean this is what we've seen over and over. Any sort of any kind of used C a bill of announcement or some sort of. Coordinated action. It's almost like does the law of diminishing returns that that the pop in the initial positive reaction is getting smaller and smaller each time and so. I think that's it's clear -- example with playing playing today. All right Stephen thank you very much for your time sure appreciate it. -- We know I'd love to -- poll numbers coming out of Europe I'd love to know with the European financial leadership feels about Mitt Romney. As compared to Barack Obama and just figure out I was just thinking about that as you're doing the interview -- and. You know Angela Merkel right in and the new president of France I've got to believe that the president of France's socialist yes right. So who's Morse who's gonna be more in line with the socialists rankings Mitt Romney -- Barack Obama.