ISIS Now Has A Navy, Launches Gunboat Attack Near Baghdad

First it was UN and US military hardware and artillery, second it was hijacked Syrian fighter jets, and now ISIS has 'commandeered' a Navy. As Reuters reports, Islamic State fighters attacked a riverside town north of Baghdad on Monday with gunboats and a car bomb, killing 17 people and wounding 54, a security source said. We anxiously await President Obama's Wednesday unveiling of the strategy to 'defeat' The Islamic State on land, and air, and now water...

Key Events In The Coming Week: iPhone 6 Release And Other Less Relevant Happenings

One of the more amusing comments overnight came from Bank of America, which now predicts that China's export growth will be boosted by iPhone 6 by 1% per month through year-end. Whether or not this is accurate is irrelevant, but we are happy that unlike before, BofA has finally figured out that iPhone sales are positive for Chinese GDP, not US, which was the case with the release of the iPhone 4 and 5, when clueless strategists all came out boosting their US (!) GDP forecasts on the iPhone release. We note this because the long-awaited release of Apple's new iPhone will certainly grab some attention tomorrow. According to a BofA poll last week and of the 124 respondents surveyed, 66% of those have noted that they are going to buy the new iPhone and of those planning to buy 75% of those will be replacing their iPhone 5/5s.

Frontrunning: September 8

  • Scotland split jitters send sterling to 10-month low (Reuters)
  • S&P 500 Beating World Most Since 1969 Doesn’t Spark Flows (BBG)
  • Happy ending guaranteed: Vietnam building deterrent against China in disputed seas with submarines (Reuters)
  • China Posts Record Surplus as Exports-Imports Diverge (Bloomberg)
  • Russia, U.S. to hold talks on 1987 arms accord (Reuters)
  • Halcon’s Wilson Drills More Debt Than Oil in Shale Bet (BBG)
  • Deadly Disappointment Awaits at Ebola Clinics Due to Lack of Space (WSJ)
  • Latinos furious at Obama on immigration delay, vow more pressure (Reuters)
  • Japan GDP Shrinks at Fastest Pace in More Than Five Years (WSJ)

All Overnight Action Is In FX As Market Reacts To Latest News Out Of The UK

After being solidly ignored for weeks, suddenly the Scottish independence referendum is all anyone can talk about, manifesting itself in a plunge in the GBPUSD which ha slide over 100 pips in the past 24 hours, adding to the slide over the past week, and is now just above 1.61, the lowest since November 2013. In fact, the collapse of the unionist momentum has managed to push back overnight news from Ukraine, major Russian sanction escalations, Japan GDP as well as global trade data on the back burner. Speaking of global trade, with both China and Germany reporting a record trade surplus overnight, with the US trade deficit declining recently, and with not a single country in the past several month reporting of an increase in imports, one wonders just which planet in the solar system (or beyond) the world, which once again finds itself in a magical global trade surplus position, is exporting to?

UK In "Full Panic Mode", Rains Brimstone, Bribes On Scotland As "Yes" To Independence Poll Crosses 50%

All pundits who over the past few months have been saying the possibility of Scottish independence as a result of the September 18 ballot, is at best a pipe dream got a rude wake up call overnight, when Scottish YouGov poll for the Sunday Times put the "Yes" (for independence campaign) on top for the first time since polling began, with No below the majority cutoff line for the first time, at 49, when undecided voters are excluded, and even when including undecideds "Yes" is still ahead by two points at 47-45. As the Spectator reports, "in the space of four weeks, "No" has blown a 22-point lead."

The Lesser Depression: How Bubble Finance Has Deformed The Jobs Cycle

The term “jobless recovery” is itself an oxymoron since the main function of any economic advance is to broaden participation. Thus a “jobless recovery” is nothing of the sort, indicating more so the re-arranging of numbers rather than full achievement – the hallmarks of redistribution.

As financialism spreads, so does disharmony, not just in function but in breaking correlations among economic accounts and statistics that were once seemingly so unconquerable.

Shinzo Abe's Six Most Worrisome Charts

It is not hard to find an exemplary chart of the collapse of the Japanese economy - as we have been diligently exposing for the past few years despite Abenomics' promises. Even Japanese government advisors are concerned: "My biggest concern is that most of the emphasis has been on solving the short-to-medium term challenges of overcoming deflation and boosting demand. While I think that emphasis has been the right approach, most Japanese economic problems really revolve around long-term issues: an aging and declining population, a need to increase our potential growth rate, and longer-term fiscal consolidation. Whether or not the government can overcome these challenges is still very much an unknown." These six charts suggest not only does Japan have a long way to go, but the trend is very much not their friend...

NATO & 21st Century War-Time Currency Counterfeiting

The justification for war has been escalated where NATO now considers it legitimate to respond to a large-scale cyber attack on a Member State with military force. The argument has been the threat of a massive cyber-attack upon the international financial markets that would cripple the international capital flows placing the economy at risk. Such a danger is actually the modern version of counterfeiting an adversary’s currency to disrupt its economy by undermining the currency thereby creating inflation and economic war.

OMGodzilla! Japanese Macro Data Revisions Even More Disastrous Than Expected

If the US equity market's reaction to the worst jobs data of 2014 is anything to go on; Japanese stocks should be a double overnight given the catastrophe that just printed. While the initial prints for the post-tax-hike period were bad enough (record worst levels in most cases), the revsions are even worse. Drum roll please: 1) Trade balance miss, worst in 4 months; 2) GDP -7.1% miss, revised down, worst since Q1 2009; 3) Business Spending/Capex -5.1% miss, revised down, worst since Q2 2009; and 4) Consumer Spending -5.3% miss, revised down, worst on record. But apart from that, as the Japanese leaders noted last week, "the recovery is heading in the right direction."

Guest Post: "We" Don't Want The Ukraine Ceasefire To Hold

While unofficial reports note the ceasefire has ended, officially there has been no comment. This is not surprising, since we few believed a truce or ceasefire holding for long. The ‘rebels’ have a lot of reasons to keep fighting: first off, they were winning; and second, they were on their way to establish a land bridge to the Crimea - which would lift their isolation. And does anyone truly believe the US/EU/NATO coalition expansionism, having spent billions on their Ukraine regime change project, are going to leave it at this? Ukraine as we draw it on the map today has ceased to exist. But that doesn’t mean the west won’t be willing to give it another try.

De-Dollarization Continues: China-Argentina Agree Currency Swap, Will Trade In Yuan

It appears there is another nation on planet Earth that is becoming isolated. One by one, Russia and China appear to be finding allies willing to 'de-dollarize'; and the latest to join this trend is serial-defaulter Argentina. As Reuters reports, China and Argentina's central banks have agreed a multi-billion dollar currency swap operation "to bolster Argentina's foreign reserves" or "pay for Chinese imports with Yuan," as Argentina's USD reserves dwindle. In addition, Argentina claims China supports the nation's plans in the defaulted bondholder dispute.

What Happens When It’s Easier To Pay No Wages Rather Than A Minimum

Today the entry-level position has morphed into something far different when you talk to anyone who's never owned or run a business. It's no longer thought of as "entry-level," as  - faced with a government-mandated 50% minimum wage pay rise in some cases - businesses may decide their choice is to either leave – or eliminate the need for - those positions all together? And the technology, along with the acceptance of it, might be farther along the development curve than many believe to foster such dramatic changes.

Stunning Video Of Iceland's Massive Lava-Fountain Lake

While Iceland's serene landscape may be the perfect analogy for world markets currently, the eruption of its Bardarbunga volcano shows what fierce reality lies just beneath the surface. Capitalism and free markets will always find away though, and as RT reports, one travel company is cashing in on the incredible awe-inspiring images by offering tours over the volcano at a height of around 150 meters. As the following stunning clip shows, at $920, it may well be the trip of a lifetime...

The Simple Truth About QE

There’s not a single day that we’re not treated to more smart treats about stimulus measures. Are they necessary, are they good, are they bad, who profits from them. It gets really long in the tooth. Today, former ECB head Trichet says unlimited stimulus ‘risks’ blowing bubbles. “Supplying unlimited amounts of liquidity at interest rates close to zero has “unintended counterproductive consequences.” No shit, assclown. Does Jean-Claude really mean to claim he just figured that one out now? Why else did he never say it before? There are 1001 other wise guys like Trichet who’ve only recently seen a sliver of light, and see fit to make the great unwashed party to their new found wisdom.

The Breaching Of American's Data Security

While Americans seem quite comfortable with the US government 'breaching' their privacy, the surge in private sector cyber-attacks and data hacks in recent months is worrisome to many. As Bloomberg illustrates below, so far the efforts have been focused on retail merchants (as opposed to banking) with Home Depot's latest breach yet to be sized but believed to be "massive."

Obama To Unveil Non-'Boots-On-The-Ground' Strategy For "Hunting Down" ISIS, On Wednesday

President Obama has swung from "we have no strategy" to "keep in mind this is something we know how to do," in a week, and speaking on Meet The Press this morning he teased the world's allies (and terrorists) with the promise that he will address the nation Wednesday to lay out U.S. plans for combating the Islamic State of Iraq and Syria (ISIS), promising the U.S. can and will defeat the group. As CBS reports, while not quite as gung-ho as Biden's "gates of hell" speech, President Obama appears to have stepped up his rhetoric from 'contain' to 'defeat' as he stated "we will hunt down [ISIS] members and assets wherever they are," but carefully added putting U.S. troops on the ground would be a "profound mistake."