Hope for a debt solution fades

The chase by Marty Cej:

Turning to the European debt crisis and the meeting of European leaders this weekend, the market's expectations have been bludgeoned lower by German government spokesmen and images of European bureaucrats scrambling the private jets for urgent emergency last minute 11th-hour crisis summit talks in Berlin. Optimism for a plan has been downgraded to prayers for a blueprint for a plan to come up with a solution.

France wants the ECB to use its balance sheet to boost the bailout mechanism's – the EFSF – funds and for the EFSF to have a banking license. Germany would like the EFSF to provide first loss guarantees to boost the funds. The French approach would increase the EFSF's available funds, a good thing, but then it also increases the exposure of the guarantors and could lead to credit-rating downgrades.

The German approach limits members' liabilities to those already agreed under the recently enhanced EFSF, but it's questionable how much value investors will give to a partial guarantee which would undermine confidence. But it's only Thursday. There's plenty of time left.
Plenty of time left for a European solution, that is. Time appears to have run out for Moammar Gadhafi (nee Qadhaffi nee Gaddafi) however.

Reuters reports that the former Libyan despot and disco king was captured and wounded in both legs near his hometown of Sirte. There are also unconfirmed reports that he has died of his wounds. We'll continue to report developments as and when they can be confirmed.

The Canadian Pension Plan Investment Board is partnering with Microsoft to take a run at Yahoo, according to unnamed sources in the Wall Street Journal. What would the CPPIB want with Yahoo? How much would the pension plan throw into the kitty? What is Yahoo worth? The CPPIB has told us that it won't comment on the WSJ story so we'll have to look under the rocks for answers ourselves.

Earnings will dominate much of our coverage this morning with EnCana reporting a drop in earnings that still appears to have topped expectations. Paul Bagnell has the file in the early going but will hand off to Brett Harris. We're watching for Shaw Communications this morning and Celestica after the close. Out of the U.S., Union Pacific, AT&T and Eli Lilly will help set the tone ahead of Microsoft after the close of trading tonight.

A parade of economic data will either be cheered or jeered (not everyone loves a parade) this morning: Initial jobless claims at 8:30 will be followed by leading economic indicators at 10 as well as the market-moving Philadelphia Fed survey out at the same time. Existing home sales, also at 10, are expected to confirm that things are tough and just getting tougher.

Viewers are listening to the news and reading the headlines and wondering what to do. In our coverage of the daily breaking news, we occasionally miss the opportunity to talk strategy and financial planning.

How do investors prepare their portfolios for a lengthy period of subpar growth? How do they position their finances for a rebound in inflation? A rally in stocks? A slowdown in earnings? There are as many plans as there are hypotheses about the next several quarters.