Greece & Turkey – Is War in the Future?

They say there is nothing more dangerous than a wounded animal. Perhaps. But there is something far worse for society – a wounded politician. When power begins to slip through their grasp, they ALWAYS turn to seek an external enemy. This is exactly what the Turkish president, Recep Tayyip Erdoan is doing. There are many within Turkey who fear he is trying to be a dictator. He has sought to gain total power and that has many people deeply concerned.
Erdoan is at risk of being overthrown and he knows it. The worse the economy becomes, the greater the probability he will be driven from power. Consequently, the fear factor is rising with tensions mounting in the Aegean and eastern Mediterranean Seas. Erdoan knows the historical animosity between Greece and Turkey. He is deliberately attempting to reignite those deep resentments by raising the prospect of a referendum on accession talks with the EU. The Greek defense minister came out and said that Greece was ready for any provocation.

This post was published at Armstrong Economics on Apr 2, 2017.

Julian Brigden: “This Is What The ‘Armageddon Scenario’ For Markets Looks Like”

Eric Townsend and Patrick Ceresna, the people behind the weekly Macro Voices podcast, have released an extended, hour-long interview with Julian Brigden founder of Macro Intelligence 2 Partners, in which among the various topics discussed (see the attached slidepack for supporting materials and charts) were:
U. S. Dollar impact on the U. S. shale bubble Peak acceleration in ISM manufacturing Headline inflation peaking Fed tightening going to start to impact data Bond shorting opportunity is over Risks to the reflationary trades Wage trends in the U. S. Perspective on European growth and inflation Relative pricing between U. S. and European bunds Brigden, who until recently was aggressively bearish Treasuries since June, is now confident that the “time to be out of US fixed income shorts for now.” The reason for that is that he anticipates the recent surge higher in economic indicators (all of them of the survey, or “soft” kind), is now rolling over, and it “doesn’t get any better.”
Furthermore, adding to the downward pressure will be the upcoming inflation peak, as the energy base effect will in several months start to exert a downward influence, the same way it boosted inflation in the late part of 2016 and early 2017.
Furthermore, the ongoing tightening of financial conditions via higher interest rates across everything from Libor to mortgages, will start to impact the data.

This post was published at Zero Hedge on Apr 1, 2017.

Will the Stock Market Crash as the Fed Hikes Rates?

This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
The U. S. Federal Reserve just hiked interest rates on March 15, but Boston Fed President Eric Rosengren says the Fed should raise rates three more times in 2017. After nearly a decade of interest rates below 1%, investors are wondering, ‘will the stock market crash as the Fed hikes rates again?’
After all, the Dow’s record-breaking run appears to be slowing down.
After smashing through all time-highs since Election Day, including a record 12-day run of consecutive all-time high closes to end February, the index is showing signs of slowing down as March ends. The index is down 2% since its all-time high on March 1.
That’s why the timing of the latest rate hikes has market watchers concerned a 2017 stock market crash could be on the horizon.

This post was published at Wall Street Examiner by Money Morning News Team ‘ April 1, 2017.

Is the Russian Government Insouciant?

On March 1 the US National Reconnaissance Office launched a spy satellite carried by an Atlas V rocket that was powered by a Russian RD-180 engine. The Unites States, an alleged ‘superpower,’ is not capable of putting its own spy satellites into space. The ‘superpower’ is dependent on Russia, which provides the ‘superpower’ with the rocket engines to put up spy satellites to spy on Russia!!! Here we have in Lenin’s words, the Russians selling Washington the rope with which to hang Russia!
Does Russia value a few more US dollars more than it values its national existence? Apparently so.
Do the Atlanticist Integrationists, the Washington funded and supported Fifth Column inside Russia, inside the Russian media, and inside the Russian government, so much desire to be part of the decadent and immoral West that they are willing to sacrifice Russian sovereignty and are willing, like all of Europe, Canada, Australia, and Japan, to be Washington’s vassal? Yes.

This post was published at Paul Craig Roberts on April 1, 2017.

Doug Noland Q1: Sure Bets That Weren’t

This is a syndicated repost courtesy of Credit Bubble Bulletin . To view original, click here. Reposted with permission.
An intriguing first quarter. The year began with bullish exuberance for the Trump policy agenda. With the GOP finally in control of Washington, there was now little in the way of healthcare reform, tax cuts/reform, infrastructure spending and a full-court press against regulation. As Q1 drew to a close, by most accounts our new Executive Branch is a mess – the old Washington swamp as stinky a morass as ever. And, in spite of it all, the global bull market marched on undeterred. Everyone’s still dancing. From my perspective, there’s confirmation that the risk market rally has been more about rampant global liquidity excess and speculative Market Dynamics than prospects for U. S. policy change.
It’s not as if market developments unfolded as anticipated. Key ‘Trump trades’ stumbled – longs and shorts across various markets. The overly Crowded king dollar faltered, with the Dollar Index down 2.0% during Q1. The Mexican peso reversed course and ended the quarter up 10.6% versus the dollar, at the top of the global currency leaderboard. The Japanese yen – another popular short and a key funding instrument for global carry trades – jumped 5% . China’s renminbi gained 0.84% versus the dollar. WSJ headline: ‘A Soaring Dollar and Falling Yuan: The Sure Bets That Weren’t’

This post was published at Wall Street Examiner by Doug Noland ‘ April 1, 2017.

Russia’s April 1 Voicemail: “Press 2 For Services Of Russian Hackers, Press 3 For Election Interference”

With the Russian election hacking scandal having gone from the merely strange, to the bizarre, to the ironic, to the McCarthyist, and most recently, jumping the patently absurd shark – as of last night, anyone who is against Hillary is “influenced by Russia” according to a former Clinton advisor – Russia decided to have some fun at the expense of US paranoia.
On Saturday, the ministry posted the following audio file of the “new” automated telephone switchboard message for Russian embassies.
“You have reached the Russian embassy, your call is very important to us. To arrange a call from a Russian diplomat to your political opponent, press 1. To use the services of Russian hackers press 2. To request election interference, press 3 and wait until the next election campaign. Please note that all calls are recorded for quality improvement and training purposes.”
Russian MFA developed automated voicemail system – please listen (Russian, then English) and tell us your opinion. Feedback appreciated! — Russian Embassy, UK (@RussianEmbassy) April 1, 2017

This post was published at Zero Hedge on Apr 1, 2017.

Is the Global Taxman Coming?

But who are they really going after?
Credit Suisse is once again under international investigation for allegedly helping its clients evade the prying eyes of national tax authorities. This comes after the bank was fined $2.6 billion by the U. S. government in 2014 for helping Americans evade taxes.
Helping high net worth private clients and corporations evade taxes, and then getting caught is not unique to Credit Suisse. Fellow Swiss megabank UBS and UK giant HSBC were fined hundreds of millions of dollars for their troubles.
The banks are not just helping their clients evade taxes. In a report titled Opening the Vaults, UK-based charity Oxfam International revealed this week that in 2015, Europe’s 20 largest banks registered over a quarter of their profits in tax havens – well out of proportion to the level of real economic activity that occurs there. Once again, Luxembourg was a top destination for funds, while in Ireland the same banks recorded profits that were 76% higher than the global average in 2015. Only the Cayman Islands was found to have a higher profitability rate.

This post was published at Wolf Street by Don Quijones ‘ Apr 1, 2017.

Who Wants What In Washington? The One Chart Summary

Once upon a time Washington was simple: on one hand you had Republican interests, on the other: Democrats, and inbetween them perhaps, the occasional independent or “green.” Now… it’s less simple. At last check, DC currently boasts at least nine different parties, groups, factions or ideologies. Which is why keeping track of who wants what, and how the various groups allign, in US politics has become quite complicated.
So, for all those confused, here is a table from Deutsche Bank which summarizes how the different groups within the White House, House and Senate align on key issues.

This post was published at Zero Hedge on Apr 1, 2017.

Maybe The Recovery Wasn’t Real After All

For a while there it looked like the US and its main trading partners had finally achieved escape velocity. Growth was up, inflation was poking through the Fed’s 2% target, and most measures of consumer sentiment were bordering on euphoric.
Then it all started to evaporate. Lackluster manufacturing and consumer spending reports sent the Atlanta Fed’s reading of Q1 GDP off a cliff to less than 1%:

This post was published at DollarCollapse on APRIL 1, 2017.

Equities Ignore Trump Chaos – Q1 Was The Calmest Market In A Decade

One glance at the shocking headlines over the first quarter of 2017 and one would imagine intense volatility in the world’s capital markets – from the leader of the free world being ‘managed’ by Putin to North Korean Nukes; and from Fed rate hikes to the rise of populism in Europe. But that would be entirely wrong – Q1 2017 was the calmest for US stocks since 2006…
Just a week ago, it looked as if the dormant CBOE Volatility Index was awakening.

This post was published at Zero Hedge on Apr 1, 2017.

Moscow And Beijing Join Forces To Bypass US Dollar In Global Markets, Shift To Gold Trade

The Russian central bank opened its first overseas office in Beijing on March 14, marking a step forward in forging a Beijing-Moscow alliance to bypass the US dollar in the global monetary system, and to phase-in a gold-backed standard of trade.
According to the South China Morning Post the new office was part of agreements made between the two neighbours “to seek stronger economic ties” since the West brought in sanctions against Russia over the Ukraine crisis and the oil-price slump hit the Russian economy.
According to Dmitry Skobelkin, the deputy governor of the Central Bank of Russia, the opening of a Beijing representative office by the Central Bank of Russia was a ‘very timely’ move to aid specific cooperation, including bond issuance, anti-money laundering and anti-terrorism measures between China and Russia.
The new central bank office was opened at a time when Russia is preparing to issue its first federal loan bonds denominated in Chinese yuan. Officials from China’s central bank and financial regulatory commissions attended the ceremony at the Russian embassy in Beijing, which was set up in October 1959 in the heyday of Sino-Soviet relations. Financial regulators from the two countries agreed last May to issue home currency-denominated bonds in each other’s markets, a move that was widely viewed as intended to eventually test the global reserve status of the US dollar.
Speaking on future ties with Russia, Chinese Premier Li Keqiang said in mid-March that Sino-Russian trade ties were affected by falling oil prices, but he added that he saw great potential in cooperation. Vladimir Shapovalov, a senior official at the Russian central bank, said the two central banks were drafting a memorandum of understanding to solve technical issues around China’s gold imports from Russia, and that details would be released soon.

This post was published at Zero Hedge on Apr 1, 2017.

Is .0006th Of An Oz Of Gold Significant Enough To Call The Bottom? [Yrly/Qrtly/Mthly Charts]

Yes.
.0006th of an ounce of gold = 80 cents, at $1250 the oz. How can 80 cents be significant relative to gold at that price? It is a tiny gap in price that was never filled. The probability of December 2015 being the end of the downside correction since the 2011 highs grows with each passing week/month. As our regular readers know, our focus is solely on developing market activity as determined by price and volume over time. We pay attention to what the market is saying about its participants and not what others are saying about the market.
There Are No Accidents:
The close at the end of December 2015 was 1060.20. The open for January 2016 was 1061.5 with a low of 1061, leaving a gap of 80 cents that has never been filled. [We use monthly continuation charts]. When looking at the higher time frame charts, the gap is so small that it does not appear as one, which is how we missed it, visually. We noticed it this week while doing a review of charts, and when we put the cursor on the annual, monthly, weekly charts, the December 2015 close of 1060.20 was clear, as was the January 2016 low at 1061, even though it did not appear as a gap when looking at the charts.

This post was published at Edge Trader Plus on April 1, 2017.

If I Were To Start My Third Hedge Fund…

This is a syndicated repost courtesy of Economy and Markets. To view original, click here. Reposted with permission.
As the great New York Yankee Yogi Berra once said, ‘It’s like dj vu all over again.’
That’s the way I feel about the markets.
I started my first hedge fund in 2002 to capitalize on what I thought would be the collapse of Internet and technology stocks. The sector dominated the market but lacked the revenues to support their valuations. Many stocks were overvalued by an infinite amount as their share value evaporated into dust.
That strategy worked out masterfully – if I may say so myself!

This post was published at Wall Street Examiner by John Del Vecchio ‘ March 31, 2017.

Goldman: “Our Client Conversations Make It Clear That Investors Fall Into Two Camps”

Judging by recent market action, it is becoming apparent that traders and investors are getting if not tired, then displeased with having to trade what boils down to one of two narratives: Trump Reflation Trade On, and – as has been the case recently – Trump Trade Off. As much is apparent in the latest weekly kickstart note from David Kostin who writes that with the market struggling to readjust its expectations for US government policy following the move away from health care reform, client conversations make clear that investors fall into two camps:
The first group worries that the failure to ‘repeal and replace’ the Affordable Care Act is a sign that other items on the policy agenda are less likely to be enacted than they had hoped. The second group is encouraged about the shift in focus to tax reform as the new top priority for the administration. Here Goldman notes, that despite the recent stumble by the Trump administration, its D. C. economist Alec Phillips continues to expect legislation late this year through the FY2018 budget resolution that will use dynamic scoring and some deficit expansion to reduce the statutory corporate tax rate. He views many of the additional reforms that have been proposed as less likely.
However, as Kostin cautions, from an equity market perspective, recent performance reflects an ongoing transition from post-election hope to an acceptance of political reality. Below, Kostin explains why the bank is increasingly souring not only on stocks (recall it downgraded global equities two weeks ago), but also on the broader economy:
Our S&P 500 outlook this year argued that the index would rally to 2400 in 1Q on hopes for earnings-friendly policy changes, but gradually decline to 2300 as investors recalibrate expectations to reflect the challenges of current politics in Washington. Although the S&P 500 has retreated from its record highs at the start of the month, it rose by 6% in 1Q 2017; its riskadjusted return (return/realized volatility) was the best since 2013.

This post was published at Zero Hedge on Apr 1, 2017.

Markets Are Set up for a Fall

This is a syndicated repost courtesy of The Daily Reckoning. To view original, click here. Reposted with permission.
I guess we can all use a break now and then, and this seems like one of those weeks when not much is happening.
We had a tumultuous 10-day period from March 14 – 24, which included a Fed rate hike, Dutch elections, a weaker dollar, a stronger euro, a rally in gold and a nervous stock market in an orderly retreat.
The news cycle was spun up with endless stories about Trump and the Russians, the failed Obamacare repeal vote and a Supreme Court nominee.
Now, suddenly, markets have gone quiet. Stocks, bonds, gold and the dollar are all sliding sideways, while the news cycle is repetitious at best and boring at worst.
On the financial front, this quiet phase may be due to the fact that there is no Fed policy meeting in April, the May meeting looks like a nonevent and the next important Fed meeting is on June 14, a long 11 weeks away.

This post was published at Wall Street Examiner by James Rickards ‘ March 31, 2017.

Russia’s New Voicemail: “Press 2 For Services Of Russian Hackers, Press 3 For Election Interference”

With the Russian election hacking scandal having gone from the merely strange, to the bizarre, to the ironic, to the McCarthyist, and most recently, jumping the patently absurd shark – as of last night, anyone who is against Hillary is “influenced by Russia” according to a former Clinton advisor – Russia decided to have some fun at the expense of US paranoia.
On Saturday, the ministry posted the following audio file of the “new” automated telephone switchboard message for Russian embassies.
“You have reached the Russian embassy, your call is very important to us. To arrange a call from a Russian diplomat to your political opponent, press 1. To use the services of Russian hackers press 2. To request election interference, press 3 and wait until the next election campaign. Please note that all calls are recorded for quality improvement and training purposes.”
Russian MFA developed automated voicemail system – please listen (Russian, then English) and tell us your opinion. Feedback appreciated! — Russian Embassy, UK (@RussianEmbassy) April 1, 2017

This post was published at Zero Hedge on Apr 1, 2017.

Down 10%, Mexico Oil Reserves Gone In 9 Years Without New Finds

(By Adam Williams-Bloomberg)
Mexico’s existing oil reserves are dwindling so fast the country could go dry within nine years without new discoveries.
That’s the message from the National Hydrocarbons Commission, which said Friday that the reserves fell 10.6 percent to 9.16 billion barrels in 2016, from 10.24 billion barrels a year earlier. Once the world’s third largest crude producer, Mexico’s proven reserves have declined 34 percent since 2013.
The decline in proven reserves is driven by record-low drilling activity the last three years, according to CNH Commissioner Hector Acosta. State-owned producer Petroleos Mexicanos drilled 21 wells last year, a record low, after averaging 31 per year since 2010.
‘If there isn’t drilling, it is going to be difficult to incorporate new finds,’ Acosta said. ‘The production figures and indicators that we are observing, tell us that there are flaws in the drilling activities being carried out by Pemex.’
Record-low drilling activity for 3 years seen as the cause Foreign explorers now working offshore offer boost by 2024 The diminished production comes from a combination of reduced investment and the continued maturation of fields, said Cesar Alejandro Mar, Adjunct Director of Reserves. He set 8.9 years as a time frame for the reserves to run out if no new exploration occurs.

This post was published at SRSrocco Report on APRIL 1, 2017.