A Brief Reminder Of Certain Events 100 Years Ago

The more things change, the more they stay the same. Following today's dramatic geopolitical escalations (which we hope are nothing like an "Archduke Ferdinand" moment); this evening has grown loud with the mainstream business media's deafening roar of BIS-deniers proclaiming that everything bad is priced-in and nothing good is priced-in and how "this is a teflon market." This is nothing new... as no less than The Financial Times proclaims on June 30th 1914 that "stock markets have been scarcely affected by the assassination of the heir to the Austrian throne... there's no evidence that stock holders took fright" as it's priced in (or contained?). It seems things didn't quite work out as 'priced-in'.

Israeli Tanks Are Rolling Into Gaza

Residents in the northern Gaza Strip said they could hear the sound of tanks entering from Beit Lahiya as we noted earlier and now the Army has confirmed:

*ISRAEL SENDING TANKS INTO GAZA: ARMY

As NY Times reports, the military released a statement saying the goal of the operation was to "establish a reality in which Israeli residents can live in safety and security without continuous indiscriminate terror." Judging by the images and clips below, they are deadly serious. Hamas warns, “The occupation will pay its price expensively, and Hamas is ready for confrontation.”

Putin Says "Ukraine Responsible For Crash... Wouldn't Happen If At Peace"

According to Russian news agency Interfax, Vladimir Putin remarked during a government meeting today that:

*PUTIN SAYS UKRAINE IS RESPONSIBLE FOR MALAYSIA JET CRASH: IFX
*MALAYSIA CRASH WOULDN'T HAPPEN IF UKRAINE WAS AT PEACE: IFX

But ordered Russia's government to all it can to investigate the crash.

Stocks Plunge, Gold/VIX Spike On Worst Airline Tragedy Since 9/11

Despite an initial attempt to rally after the terrible news out of Ukraine hit, stocks were unable to mount any serious BTFD as uncertainty spread. Despite Bullard's best efforts, bond yields crashed lower (over 7bps today) with 10Y at 2.45% near the lowest close in 13 months. Gold prices jumped over $20 (even as the USD Index flatlined - though JPY strengthened notably as risk-off set in). VIX exploded 3.7 vols (its biggest swing - 45% - since Aug 2011). Equity markets cratered into the close as Israel ground invasion news (A White House Lockdown) added to the concerns leaving all US markets red post-payrolls and red post-Yellen. The S&P 500 dropped 1.18% - its biggest drop in 3 months. The Russell 2000 is now down 2.5% year-to-date.

Fed's Bullard Urges Investors To Sell Bonds (But Not Stocks)

Given the market's rapid surge to dismissing The Fed's stock-selling recommendations, we are stunned by the silence of "market defenders" as once again the Fed takes to the airwaves to demand investors sell their bonds...

BULLARD SAYS FED BALANCE SHEET POSES INFLATIONARY RISK; QE 'FORCED SOME INVESTORS INTO MORE RISK TAKING'
BULLARD SAYS HE WORRIES ABOUT A BOND MARKET BUBBLE BUT STOCKS RETURNED TO MORE TRADITIONAL VALUATION'

Of course we know why they are so desperate for investors to sell their bonds (aside from the economic growth reassuring meme it provides), because they are in full panic mode over the broken repo markets we discussed in detail here.

Ukraine Rebels Find Black Box, Multiple Airlines Halt Routes Over Ukraine: Full MH 17 Update

The plot thickens. Moments ago, after Ukraine emergency services complained the crash probe was being hampered by separatists, it is these same "rebels" that appear to have found a key piece of the puzzle.

  • PRO-RUSSIAN SEPARATISTS IN EASTERN UKRAINE SAY THEY HAVE FOUND "BLACK BOX" FLIGHT RECORDER OF DOWNED MALAYSIAN AIRLINER - INTERFAX

The question now is simple: what happens to the black box next, and perhaps more importantly - why anyone thinks a black box will have any information on who shot the missile that allegedly took down flight MH 17.

President Obama Speaks - Live Feed

While President Obama is supposed to be discussing the need to spend more and more taxpayer money (especially those who benefitted unequally from the Fed's money printing) on infrastructure... but can't because of the Republicans... think of the bridges and roads. However, we suspect he will be forced to take note of the ongoing accusations in Ukraine (and his conversation with Putin)...

Jim Rogers Blasts "The US Dollar Is A Terribly Flawed Currency"

Reflecting on the growing anti-dollar alliance (especially among the BRICS as we noted here), Jim Rogers exclaims "The US dollar is an extremely flawed currency... we have serious problems... and the world needs something else." His perspective is that maybe (just maybe) a combined China, Russia, Brazil joint-currency can battle the dollar's dominance. Rogers goes on to discuss the rationale for the increased cooperation between these 5 nations with multi-billion populations but notes while Russia has lots to add, "I would throw India out" of BRICS.

State Department Live Briefing On Malaysian Airlines Crash

It is abundantly clear that nobody knows anything at this point (aside from the ridiculous "news" circulating on social networks that separatist leader Igor Strelkov admitted to shooting down the plane, which he did not as can be seen on his actual VK.com page), but that will not prevent the media from already having a clear narrative of exactly what happened, and State Department Jen Psaki will be unable to confirm or deny anything. Watch live below.

Russian TV Live Coverage Of Malaysian Airlines Jet Crash

This is a video feed from Russian news outlet Life News which will obviously have an appropriate bias. We are using it as they are the first news crew to allegedly have reporters on the crash site. The images are disturbing.

Obama And Putin Speak, Mention Plane Crash; Obama Threatens With More Sanctions

While the world was riveted by the latest Malaysian Airlines tragedy, Obama and Putin spoke. According to Reuters, Obama warned Russian President Vladimir Putin on Thursday that the United States and its allies are prepared to impose additional sanctions on Moscow if it does not change course in Ukraine.

Russian Ruble Crashes Most In 3 Years

The Ruble was already losing ground on the back of US Sanctions but those losses accelerated markedly after the Malaysia Airliness jet crash news. This is the biggest drop in the Ruble since August 2011...

Gold Up Most In A Month, VIX Spikes Most In 6 Months

Despite CNBC's best afforts to play down this "may have been shot down" news of 295 dead on a Malaysian Airlines jet in Ukraine, markets are turmoiling. New lows for the day in stocks and bond yields have been accompnied by a surge in Gold (up over $25) and VIX (up almost 2 vols) with its biggest jump in 6 months.

The Fingerpointing Begins: Ukraine Accuses Rebels Of Shooting Down Airplane, Rebels Deny

That didn't take long for the Ukrainian government to know exactly what happened:

*UKRAINE REBELS SHOT DOWN MALAYSIAN PLANE, GERASHCHENKO SAYS; But
*DONETSK SEPARATISTS SAY NOT INVOLVED IN PLANE CRASH: INTERFAX

All 280 passengers and 15 crew were killed in the crash. The Malaysian Airlines jet was shot down by the BUK Missile System according to Interfax.