While we will have to wait a few weeks to see if the French are still into that whole "Liberté, égalité, fraternité" deal, it appears that the markets have already priced-in a future in which Frexit does not exist.
Global banking stocks rallied after it was announced Sunday that centrist Emmanuel Macron will advance in the French election to take on Marine Le Pen, a far-right candidate. Investors rushed into bank stocks, fleeing safe havens like government bonds and gold as interest rates moved higher.
This was the scenario nervous traders going into the weekend wanted most, and it removed a heavy uncertainty overhanging global markets and the euro since the start of the year.
Perhaps not since our eyes were gifted with the imagery of Yanis Varoufakis riding his BMW motorcycle through the streets of Athens has optimism in Europe been this high. Oh, you think we're being hyperbolic?
Shares of Deutsche Bank rose by more than 10 percent after market open in the U.S. on Monday, as investors took the results from the first round of the French presidential election to mean it will be business as usual for banks in the Euro zone.
That's not a typo. Deutsche Bank stock is UP. Behold, a miracle:
So certain is the market of an eventual Macron victory that people are now consciously investing in what's left of John Cryan's Frankfurt fiefdom. And nothing says stone-cold certainty in a Le Pen defeat like handing your money to Cryan, the unluckiest British man in Germany who isn't a character from a John LeCarre novel.
As far as the market is concerned, Le Pen's xenophobic, populist, geopolitically destabilizing political revolution is over! And taking into account how the market has predicted the last few xenophobic, populist, geopolitically destabilizing political revolutions, Le Pen is almost definitely going to win.