While the "developed" world scrambles to find a way to provide Ukraine with a bailout in such a way that Russia doesn't turn off the gas, Ukraine is doing some scrambling of its own to assure the local banks, which have been plagued by both bank runs and a collapse in the currency to record lows over the past few days, that it will be there to provide funding on a business as usual basis. Itar-Tass reports that "Ukrainian banks will be provided with necessary liquid assets, including cash." But there is a condition: the funding will only come "if they will remain under open control of the National Bank of Ukraine, the newly-appointed NBU Chairman Stepan Kubiv is quoted as saying on the bank’s official website."
Is the groundwork for the "transitioning out" of the US Attorney General being laid? From Reuters: U.S. Attorney General Eric Holder was taken to a Washington, D.C., hospital as a precaution on Thursday after he felt faint and was short of breath during a morning meeting with his staff, his office said in a statement. "He is currently resting comfortably and in good condition. He is alert and conversing with his doctors," according to the statement. Please get well soon Eric: how else will this nation sleep easy at night knowing there are still so many "Too Big To Prosecute" banks out there whose wrists you still have to slap?
Yesterday's "better than expected" New Home sales served as the "good news" pre-market boost to send futures ramping higher once again, if not enough to cause a fresh all time high. Here is what really happened when one spreads the numbers, courtesy of Mark Hanson's housing blog. "If all of the 4 regions were in this morning's New Home Sales print were rounded down to the nearest thousand by the Census Bureau vs up, it would subtract 4k sales, or about 12%. Even with the massive January seasonal adjustments, this would result in a SAAR headline print of 428k, or flat YoY vs the up 10% reported. If only the South was flat YoY like the other regions, the same thing would occur. "
Maybe because, gasp, it wasn't the weather?
The following remarks by John Kerry, borne out of his humiliation over the complete fiasco that was the US intervention in Syria last year and the even greater fiasco that was this year's attempt to get all feuding parties on the table in Geneva, only to see that outcome obliterated as well, appear to be borne out of his disgust at the defunding of the US defense budget, which for Kerry, more than his gross incompetence, is the reason why the US now finds itself in a "new isolationism" leading him to conclude that the US is "beginning to act like a poor nation." One wonders what tipped him off: the fact that the US debt just hit a record high $17,419,220,117,766.69 or that the biggest monetizers of US deficit spending are the Fed, China and just as insolvent Japan?
While the IMF is promising a massive bailout to the Ukraine, and NATO is using the harshest language it can possibly muster to halt Russia in its tracks, Putin is doing what he does best: employing brute force (as seen below), and using even harsher language, to wit: RUSSIA: WEST MUST STOP MAKING PROVOCATIVE STATEMENTS ON UKRAINE.
Two weeks ago, Janet Yellen's testimony to the Senate, following her remarks to the House, were delayed due to inclement weather. Now that it is no longer snowing, she is back behind the mic at the Senate Banking Committee, where she will deliver the same identical prepared remarks as she did last time, but obviously with a different Q&A. Watch it live here.
NATO Calls Ukraine Developments "Dangerous And Irresponsible", Urges Russia Not To "Escalate Tension"Submitted by Tyler Durden on 02/27/2014 - 09:51
Russian tat. And now, NATO tit.
- NATO CHIEF SAYS ACTIONS BY ARMED GROUP IN CRIMEA "DANGEROUS AND IRRESPONSIBLE"
- NATO URGES RUSSIA NOT TO DO ANYTHING THAT WOULD "ESCALATE TENSION OR CREATE MISUNDERSTANDING"
And the lie of the day:
- U.S., NATO HAVE NOT DRAWN UP ANY CONTINGENCY PLANS FOR HOW THEY WOULD RESPOND IF RUSSIA INTERVENED IN CRIMEA-NATO'S TOP MILITARY COMMANDER
- THERE IS NO REASON FOR NATO AND RUSSIA TO COMPETE OVER THE FUTURE OF UKRAINE-NATO COMMANDER
Actually, there is, which is precisely why Putin will smile when reading the latest NATO pleadings.
For now the only number that matters is the capital goods orders nondefense aircraft, aka core capex. It is here that while the sequential print was a modest increase of of 1.7%, compared to expectations of a -0.2% decline, it is the annual number that is of interest. We focus on this, because as can be seen on the chart, the annual change just posted its first annual decline in a year: in the past any such decline would mark the start of a recession, except of course for in 2012 when the New Normal central planning, and the trillions in Fed liquidity injections, made the business cycle as we know it meaningless. So much for that $1+ trillion in QE: it is good to know that it went to stock buybacks and dividends... if not so much to actually investing in future growth.
Pro-Russian Gunmen Seize Ukraine Crimean Parliament; Russia Puts Jets On High Alert; Hryvnia In Record PlungeSubmitted by Tyler Durden on 02/27/2014 - 09:01
All those clips we showed in the past few days of Russian forces amassing in the Crimean? Well, turns out they were all predictive of what has just happened in the Crimean region parliament at Simferopol, where around 120 pro-Russian Gunmen occupied the parliament building and raised the Russian flag. The scene was the site of Wednesday’s scuffles between Tatar groups and pro-Russian supporters. As Euronews reports, local Tatar leader Refat Chubarov posted that the buildings have been occupied by men in uniforms bearing “no recognisable insignia.” Kyiv says it would regard any movements by Russian military in Crimea outside Moscow’s Black Sea Base in Sevastopol as an act of aggression. Following the fall of President Viktor Yanukovych divisions in Ukraine have come to the fore. All this happens as Russian troops in the area are building up and at the same time as Russia put fighter jets on combat alert, according to Interfax.
According to the meteorologists interpreting last week's initial claims report, it must have snowed a lot in the week ended February 22, because while no states had any numbers estimated, the initial claims for the past week jumped by 14K, to 348,000 - the highest weekly number in all of 2014, and the biggest miss of expectations of 335K in a month, with the prior week's print revised as usual higher by 2K to 336K. Curiously while the Oracles attribute the seasonally adjusted number to seasonal factors (the NSA print actually dropped from 321K to 311K), the DOL itself said there were no special factors in last week's claims figures. So someone is lying. What is not lying, is that as the chart below clearly shows, the weekly claims level is now back to levels last seen in July of 2013 and is continuing to deteriorate. A lot of snow must have fallen in the past 7 months to explain this.
Draghi's Monetary Nightmare Refuses To End As European Private Lending Remains Stuck At Record Low LevelsSubmitted by Tyler Durden on 02/27/2014 - 08:24
With just released inflation figures out of Germany coming weaker than expected, Mario Draghi's monetary nightmare - how to spur credit creation in Europe to the private sector - just got even worse. Incidentally the topic of Draghi's "Monetary Nightmare" is well-known to regular readers and has been covered here extensively in the past, most recently here. So while we await to see how the ongoing deflation in Europe, soon hitting its core too, spreads through the system, the most recent data out of Europe is that lending to non-financial corporations declined once again in January, this time by €11.7billion, adjusted for securitizations and sales. On an annual basis, the decline in January was -2.0%, the same as December, and worse than the -1.8% in November as reported by the ECB.
- European Bonds Surge on Slowing German Inflation, Ukraine Tumult (BBG)
- Ukraine tensions hit shares (Reuters)
- Debating Geithner’s Appearances in 2008 Transcripts (Hilsenrath)
- Tensions in Asia Stoke Rising Nationalism in Japan (WSJ)
- GM Investigated Over Ignition Recall Linked to 13 Deaths (BBG)
- Smartphone wars shift from gadgetry to price (Reuters)
- Some Companies Alter the Bonus Playbook (WSJ)
- London’s Subterranean Luxury Manors Lure New Breed of Lenders (BBG)
- Japan No Country for Old Farmers as 7-Eleven Takes Plow (BBG)
- Dream of U.S. Oil Independence Slams Against Shale Costs (BBG)
Three unlucky attempts in a row to retake the S&P 500 all time high may have been all we get, at least for now, because the fourth one is shaping up to be rather problematic following events out of the Crimean in the past three hours where the Ukraine situation has gone from bad to worse, and have dragged the all important risk indicator, the USDJPY, below 102.000 once again. As a result, global stock futures have fallen from the European open this morning, with the DAX future well below 9600 to mark levels not seen since last Thursday. Escalated tensions in the Ukraine have raised concerns of the spillover effects to Western Europe and Russia, as a Russian flag is lifted by occupying gunmen in the Crimean (Southern Ukrainian peninsula) parliament, prompting an emergency session of Crimean lawmakers to discuss the fate of the region. This, allied with reports of the mobilisation of Russian jets on the Western border has weighed on risk sentiment, sending the German 10yr yield to July 2013 lows.