Follow us on Facebook!

There's conflicting and rather dramatic news out of Europe today over the BBC's report that George Papandreou is offering to resign from his role as Greek Prime Minister. New information says the embattled PM will fight to keep his position. All of this comes just days after announcing that Greece would hold a referendum on the terms of the country's bailout. The prospects of a Greek vote causing a delay in the implementation of the rescue plan announced last Thursday shocked global markets and outraged European officials.

In response, German Chancellor Merkel and French President Sarkozy demanded any Greek referendum be simple yes or no choice on whether the country will remain in the Eurozone or go it alone. Regardless of Papandreou leaving office or not, staying on as Premier, or slinking off the international scene entirely, it's been made clear that Greece will either accept Europe's charity as offered or get nothing and deal with it. From what we've seen so far, it looks like the Greeks are going to go with the former.

Oh yeah, the European Central Bank (ECB) announced a surprise 25-basis point rate cut to address the growing crisis.

It's unclear whether these developments qualify as the "monumental" moves from Europe some traders want, but it certainly changes the conversation. The only debate now is whether or not Greece will be allowed to stay in the Eurozone and what it would mean if they left. I spoke to Peter Schiff, president of Euro Pacific Capital yesterday, prior to the latest developments, to discuss Greece's plight.

"Greece itself is not the problem," says Schiff. "It's the moral hazards that result from how Greece is handled." Schiff believes whatever the EU does with Greece now will set the tone for the rest of the troubled nations.

Follow us on Facebook!

The Federal Reserve may have released a relatively benign statement taking no further action to stimulate the economy, but a fierce debate is just getting started over the Central Bank's next moves.

The FOMC statement reiterated that interest rates will hold near zero through mid-2013, and "Operation Twist" —the program to shift its bond holdings toward longer dated maturities, remains in place. This, along with language stating "economic growth strengthened somewhat in the third quarter," enabled a sturdy Wednesday afternoon market rally.

During his quarterly press conference held nearly two hours after the FOMC statement release yesterday, Federal Reserve Chairman Ben Bernanke issued the committee's updated economic outlook, forecasting a gloomier picture for GDP and the unemployment rate. The Fed's 2011 GDP outlook was slashed to a range of 1.6 - 1.7% from 2.7 — 2.9%, and 2012's cut to 2.5 — 2.9% from 3.3 — 3.7%. The outlook for the unemployment rate is now 8.5 — 8.7% for 2012. Due to the weakened forecast, the Fed Chief made it clear that the central bank is ready to act if necessary.

"You might call it over propaganda," says Peter Schiff of Euro Pacific Capital in the attached video. " I think the U.S. economy is getting worse and the Fed is constantly having to ratchet down its previous expectations."

Bernanke did make it clear that he's "dissatisfied" with the rate of economic improvement calling it "frustratingly slow." Subsequently, he's not alone, as there's a growing chorus of complaint that wants the Fed to back off.