Managing Expectations

Some bickering is afoot over in Europe as we approach the big day in Brussels on Friday. I'm sure this is natural. Merkel just doesn't know what to wear to the summit and Sarkozy doesn't know whether to go with the two or four inch shoe lifts.

There is so much hope and optimism, but an equal amount of skepticism as the markets approach the big day. Can they fix all this in one meeting? Of course not. Will it be easier to screw this one up then find a solution? Absolutely.

Here is some news that just broke this morning and futures dipped as a result:

Germany official: Still no EMU-wide agreement ahead of EU summit, now more "pessimistic" on chance of EU deal; cannot foresee running EFSF and ESM at same time - financial press- Sr German Official: Expects that EU states will have to meet on own at some point during EU summit; Talks in past days shown that some "actors" not aware of seriousness of situation in EU; Will not make bad treaty-change compromises at EU summit.

The news flow will undoubtedly heat up over the next couple of days and Europe may make best efforts to curb some enthusiasm.  Maybe the "Eurozone" would be in better shape if it didn't sound like a club full of tight shirts, hair gel and crappy disco music.

In other news, Obama turbo charged up his class warfare stance yesterday and Herman Caine was seen at a KFC spreading butter on a biscuit with a potato wedge. Mitt Romney never had time for any extramarital affairs, he was too busy taking his dungarees to the dry cleaners for crisp pressing.

Long $CLF, $AGU, $LOGM, $GPOR, $JLL, $PANL...short euro

Good luck today. Things are changing by the minute, so stay on your toes.