Archive - 2015

Thus ends KaloBios' "turnaround in progress" - two months after it was dragged out of bankruptcy by Martin Shkreli in an attempt to crush the company's shorts and unleash a massive squeeze, Kalobios is again, well, bankrupt.

Once upon a time, we had strong, vigorously enforced laws that made a bank the safest place to store paper assets. That is no longer. Now banks are where your wealth is most likely to be stolen – and by the bank itself. Thanks to the bail-in, the term “bank robbery” now has an entirely different meaning.

“We will satisfy the demand of our customers. We no longer limit production. If there is demand, we will respond. We have the capacity to respond to demand," Saudi oil minister Ali al-Naimi told reporters on Wednesday, underscoring the kingdom's belligerent stance as "lower for longer" heads into 2016. Meanwhile, Russia's Finance Ministry may reconsider its forecast for $50/bbl crude, a move which could inflate Moscow's budget deficit.

Even as Islamic State oil continues to flow from Syria and Iraq through Turkey, Ankara says it's cracking down on ISIS sleeper cells. In the latest example, Turkey has arrested two men the government says were planning a suicide attack on New Year's Eve in the country's capital.

• Oil rebound fizzles, sending global shares lower (Reuters)
• Saudi Arabia Won’t Change Oil Production (WSJ)
• China suspends forex business for some foreign banks (Reuters)
• Republicans come up short in search for diverse voters in 2016 election (Reuters)
• Oil Prices Become a Problem for U.S. Steelmakers (BBG)
• Oil-Producing States Battered as Tax-Gushing Wells Are Shut Down (BBG)

With just two days left in 2015, the main driver of overnight global stocks and US equity futures remains the most familiar one of all of 2015 - crude oil, which, after its latest torrid bounce yesterday has resumed the familiar "yoyo" mode, and again stumbled dropping below $37 on yesterday's surprising API 2.9 million crude inventory build, as well several more long-term "forecasts" by OPEC members, with Kuwait now budgeting for $30 oil, while Venezuela's Maduro said the oil price fell to $28/bbl and is "headed downward." As a result U.S. futures declined and European stocks fell, extending their worst December drop since 2002 in thin volume on the last full trading day of the year.

"We are right back at it: trying to stimulate growth through easy money. It hasn’t worked, but it’s the only tool the Fed’s got. The biggest hope I had was that we would enter a new era of personal responsibility. Instead, we doubled down on blaming others, and this is long-term tragic..."

For the first time since the August collapse, Offshore Yuan is trading over 1000 pips weaker (relative to the USDollar) than onshore Yuan, signalling outflows are once again escalating. Following the chaos in HIBOR money-markets, Offshore Yuan has crashed to 6.5970 (below August spike lows) to the weakest since Dec 2010. On the heels of this recent divergence between on- and off-shore Yuan, China has suspended some foreign banks from FX trading, we suppose to try and stem the capital outflows.

"The bottom line is that people around the world, regardless of their nationality, should know that the United States is not spying on ordinary people who don’t threaten our national security, and that we take their privacy concerns into account in our policies and procedures.  This applies to foreign leaders as well." - Barack Obama, January 17, 2014

At this point in time, nuclear war can only be avoided in two ways. One way is for Russia and China to surrender and accept Washington’s hegemony. The other way is for an independent leader in Germany, the UK, or France to rise to office and withdraw from NATO. That would begin a stampede to leave NATO, which is Washington’s prime tool for causing conflict with Russia and, thereby, is the most dangerous force on earth to every European country and to the entire world. If NATO continues to exist, NATO together with the neoconservative ideology of American hegemony will make nuclear war inevitable.

The U.S. dollar is currently accepted as the world’s reserve currency, but it hasn't always been this way...

In addition to receiving a salary and a constant stream of weapons courtesy of regional Sunni benefactors, and on top of being allowed to live in a perpetual state of dark, bacchanalian revelry, Islamic State soldiers also recieve 20% of the "loot" in captured territory and belong to a kind of militant Sam's Club which guarantees a 50% discount on a variety of fun items.

The movement toward deeper European integration appears to have halted, and gone into reverse, as the EU seems to be unraveling along ideological, national, tribal and historic lines. If these trends continue, and they seem to have accelerated in 2015, the idea of a United States of Europe dies, and with it the EU. And this raises a question about the most successful economic and political union in history - the USA.

"On one occasion, he told shareholders worried about the prospects of a gas well that they needed only to 'Trust Jim Bob'"...