Thanks To "Title 50", US Boots Are Already On The Ground

"When are actual boots-on-the-ground, not Presidential promise-breaking boots-on-the-ground?" ... when, as The Washington Post reports, those 'boots' are protected by 'legal alchemy' called Title 50... simply put, as Ignatius concludes, "U.S. boots are already on the ground, and more are coming. The question is whether Obama will decide to say so publicly, or remain in his preferred role as covert commander in chief."

An Appalling Practice Used In Only Two Nations, Of Which The US Is One

Eritrea - a tiny, mostly unheard-of country in East Africa - taxes its citizens who live abroad. Nearly every other country in the world bases its tax system on residency rather than citizenship. This practice has been condemned as “extortion” and a "repressive" measure by an 'authoritarian' government by the media. In Resolution 2023, the UN Security Council condemned Eritrea for "using extortion, threats of violence, fraud and other illicit means to collect taxes outside of Eritrea from its nationals." You may be thinking, "What's the controversy? Eritrea is getting criticized, and rightly so.” But there's another country that does the same...

Russia To Deploy "Full-Scale Military Unit" In Crimea

Just a day after NATO began military exercises (with troops from the US) near the city of Lviv in Western Ukraine, WSJ reports Russia's Defense Minister Sergei Shoigu is responding to the "rising foreign military presence," near Russia. In a not-so-de-escalatory move, Shoigu explained that NATO's comments were "light-minded" and his ministry's key task now is to "deploy a full-scale and self-sufficient force grouping" in the Crimea region.

JPY Plunges To 6-Year Lows, Nikkei Tops 16,000 As Japanese Deficit Runs 41st Month In A Row

For the 41st month in a row, the Japanese Trade Balance is in deficit (around JPY1 trillion). Of course, the fact that exports fell 1.3% (but but devalued currency means competitive?) means nothing as all that really matters is the collapsing JPY (now at 108.60) at its weakest against the USD in 6 years. That can mean only one thing - a surging Japanese stock market - as the Nikkei breaks 16,000. What is odd - just as in the US - is the rising equity index (no doubt helped by Japanese pension funds buying JPY393billion in Q2) against a backdrop of plunging indivdidual stocks. Sony is limit down (as we explained earlier) with offers outnumbering bids 8-to-1. And that's Japan...

The "It Doesn't Matter Until It Matters" Chart Of The Day

Growing concerns about the weakness of breadth in the stock 'market' where, as we noted here, 47% of Nasdaq Composite stocks are down at least 20% from their highs with the average stock in the index in a bear market (down 24%), continue to be ignored by a market that cares nothing for fundamentals. NewEdge's Brad Wisack adds another "it doesn't matter until it matters" chart to the list of worrisome indicators today by noting that "we haven't seen this before..."

How Germany Defines, And Deals With, HFT Market Abuse

"The HFT Act will add the following clarification to the rules specifying the prohibition of market abuse: The placing of purchase or sale orders to a market by means of a computer algorithm which automatically determines the parameters of the order could be considered market abuse provided the placing of orders occurs without a trading intention, but (a) to disrupt or delay the functioning of the trading system, (b) to make it more difficult for a third party to identify genuine purchase or sale orders in the trading system, or (c) to create a false or misleading signal about the supply of or demand for a financial instrument."

Guest Post: The US-EU-Russia Sanctions Puzzle

Whatever Russia does, doubt does not even enter the equation. The answer is sanctions. So here we go again. No one ever lost money betting on the stupidity of the usual, unknown “senior US officials” – who are now spinning the latest sanction package is to force Moscow to “respect international law and state sovereignty.” A cursory examination of the historical record allows this paragraph to be accompanied by roaring laughter. As for Russia’s "isolation", companies are barred from, in Washington-Wall Street newspeak, "important dollar-denominated funding sources." Or, euphemistically, "Western capital." This means the US dollar and the euro. Anyone following superimposed moves towards a multipolar world knows Russia does not need more US dollars and euro.

Goldman's Former Head Of Housing Research Predicts Housing Crash, Recession Within Three Years

When a former Goldman executive and the prior head of its housing research team comes out with a shocking analysis so contrary to what the same individual would do in his "former life" when he would be extolling the "inevitable" rise of home prices from here to eternity and beyond, and also throw in an open letter to none other than president Obama, predicting at least a 15% crash in home prices in the next three years, a move which would without debt catalyze the next US recession, it is time to pay attention. Meet Joshua Pollard, who in February 2009 took over coverage of US Housing at Goldman Sachs.  His point, in short: "House prices are 12% overvalued today. They have already started to decline. Today’s misvaluation matches the excess of 2006-07, just before the Great Recession... 5 of the last 7 US recessions were led by a weakening housing market... I am lamentably confident that home prices will fall by 15% within three years." Or, as some may call it, crash.

California Is Burning: Postcards From The Inferno

As if the drought was not disastrous enough for California, a consequence of the state's dryness is that nearly 6,000 firefighters are battling 12 separate wildfires raging across the Golden State. As the Cal Fire chief notes, "We've seen a lot more fires, and with those fires, more and more people are at threat. Every day we continue to see new fires ignite, forcing hundreds to evacuate," and the following images from the infernos suggest there is no end in sight as "we start to see winds pick up and conditions are at their driest."

Goldman's Yellen Press Conference Post-Mortem: "Few Surprises"

Having confirmed yesterday that China's "Stealth QE" is absolutely uber-bullish (despite PBOC playing it down themselves), Goldman is out after the close (having seen stocks give all their post-FOMC gains back) to confirm the "Fed is still dovish" meme...

House Votes To Fund Arms To Moderate (For Now) Syrian Rebels (And Ex-Im Bank) - Live Feed

*HOUSE HAS VOTES FOR U.S. AID TO SYRIAN REBELS; VOTE CONTINUING

Those sneaky politicians... The House has just begun voting on whether to amend the US Spending Bill to enable funding for Obama's grand strategy of training "moderate Syrian rebels.

  • *SYRIAN REBEL AID IS PROPOSED AS AMENDMENT TO U.S. SPENDING BILL
  • *HOUSE BEGINS VOTE ON U.S. AID TO SYRIAN REBELS SOUGHT BY OBAMA

However, what few have also noticed is that the bill also includes an extension for funding the Export-Import bank.

Stocks Give Up Post-FOMC Gains; Dollar, Bond Yields Surge

Obviously, today's market was all about the Fed. some brief stop-running early on took out yesterday's highs only to fall back before Yellen... then the fireworks began. The initial kneejerk reaction was to sell stocks, sell bonds, and buy USDs. Then came the re-reaction - VIX was slammed below 12, the S&P 500 surged to near intraday record highs, bond yields accelerated higher, EUR and JPY weakness sparked USD bid, and PMs slipped lower as Yellen meandered uncomfortably through a two-faced press conference. By the close, the USD had hit fresh 4-year highs (USDJPY over 108), stocks had roundtripped to unchanged from FOMC, Treasury yields were notably higher, VIX back over 12.5, Trannies surged.

How To Game A Rigged Market

"it may make sense to stay invested, but we have reached a point where protection against an untidy denouement to the present market phase should be built into the construction of a portfolio. It is not enough to rely on a protection that will be executed in response to price signals."

VIX Slammed Under 12, S&P To Record Highs As Yellen Starts To Speak

UPDATE: Stocks have roundtripped again since she started...

Having oscillated in a wide range immediately after the FOMC statement's release, stocks have decided that up is the way to go and the S&P 500 just hit new all-time record intraday highs (helped by a VIXnado collapse under 12 and surge in USDJPY). Treasury yields are higher, USDdollar is higher (but fading back from its initial spike), and gold and silver and unchanged.

Janet Yellen's "Double-Dissent, Exit Strategy" FOMC Press Conference - Live Feed

Having used the most words ever in an FOMC statement to describe the total shenanigans that they have created, Janet Yellen prepares to 'meet the press' to explain how 'considerably' well things are going and yet how much 'considerably' more is needed to be done... For now the meme is that this statement is more dovish than the previous one; we suspect she will want to walk that back a little.

The "Dots" Chart - Then And Now

Perhaps the one most important, if completely meaningless chart (because it will as usual revised countless times in the next year and the final outcome will be anything but what the Fed is predicting) that everyone was looking for in today's FOMC forecast materials, is the so-called "dots", so here it is.