Barclays in Africa…..what’s going on in London? Disturbing news reaches me from the Dark Continent. It appears that in at least three countries, trust in the Barclays retail operation has plummeted. However, it doesn’t seem to be a case of the fraudulent bribery that is endemic through Africa.

Allegedly, over the last four to six weeks, international transfers from other accounts (with non-Barclays banks) in Canada and Asia have not arrived, as such. All such transfers to Africa go through Barclays London as intermediary.

In one particular case, a Barclays employee in Tanzania alleges that the transfer could be seen on the system by the local branch there but the money was not released by London. It then vanished. Elsewhere, UNICEF employees are becoming somewhat restive about their salaries….als0 paid through Barclays London, and also suffering from acute Glenn Miller syndrome.

One is left wondering whether the huge fines for serial fraud that Barclays ran up under Black Bob the part-time airline pilot were perhaps too onerous. Let us all hope there is an innocent explanation for this, as it would be a shame if the new fraud-shredding system there contained a flaw.

Spain, Italy, and the default option….an unstoppable force? The Slog has been boffing on about the size of the real Spanish bank emptiness – and the size of the economic fibs coming out of Italy – for a long time now. But both realities are finally beginning to dawn upon both the locals and the Sprouts.

Part of the specific banking problem in Iberia is the ridiculously overvalued assets used to suggest that any of them are solvent – especially in property. Madrid has, for instance, allocated €32 billion as the sandbagging required to keep Banco Malo (the ‘bad bank’) from collapsing when the tide comes in. But with some analysts now predicting a next stage of property price collapse to within 15% above the boom’s starting point, others believe the real amount required is at least ten times that. Mariano Rajoy has already told Brussels and the ECB that €500billion is the starting point for any bailout.

That begins to make the default option seem a worthwhile risk from the Spanish viewpoint….and a similar attitude is gaining ground in Italy. The alleged ‘comedian’ Grillo is in fact a smart cookie. He told the media last week that “Italy’s debt is so large now, renegotiation is the only option….we are being crushed by our debt. When the interest payments reach €100 billion a year, we’re dead….in six months time, we will no longer be able to pay pensions and the wages of public employees.” It’s obvious that Signor Grillo is using ‘renegotiation’ as the polite term for effective default. His reasoning is the same as Rajoy’s: there is no possible way that the electorate are stupid enough to accept more austerity (rather than debt reneging) if the debt mountain can’t be climbed anyway.

Volatility and Futures: Is the Fed manipulating the indices? The S&P Vix hit 90 in 2008, today it’s slumped to 14. The miners GDX is low, and the rate of descent has been increasing over the last 48 hours. The Comex gold futures table shows flat expectations around $1590, with a smallish dent in the middle.

Almost everyone got it wrong in 2008 until the very last minute. My hunch this time is that either they’re even more hopelessly wrong than they were last time (in which case, sell stocks and buy gold) or a lot of unrecorded and very probably printed Fed money is being thrown at keeping the indices in Happy Hour (in which case, sit tight). This latter probably wasn’t a factor last time (when the S&P Vix was high from late 2008, but the size of impact caught Washington completely off guard) and so I would hypothesise is may well be this time. As it happens, a New York banker told me the week before last she was “very surprised” that the S&P index was still falling – often code with this lady for “it’s totally incredible”.

Nobody knows for sure, but my trusted New Mexico marathon man comments, “the VIX spiked well in advance of the March 2009 lows for the S&P….so there is some lead/lag involved”. Stay tuned….and if you have a view, let’s hear it.

Earlier at The Slog: Venizelos Kettle calls pot Schäuble black, accuses him of conspiring at Grexit