Archive - Jan 2016

On the one year anniversary of the Charlie Hebdo attacks, one man decided to "celebrate" by storming a police station in Paris - with a knife. He was promptly shot.

• China turmoil sends oil, stocks sliding (Reuters)
• China's Stock Traders Go Home After 29 Minutes (BBG)
• Yuan hits weakest since Feb 2011 on fresh low midpoint (Reuters)
• Stocks Extend Rout, Oil Slides on China as Soros Warns of Crisis (BBG)
• China's 29 Minutes of Chaos: Stunned Brokers and a Race to Sell (BBG)
• North Korea Uses Bomb Test to Boost Dictatorship (WSJ)

Once China set the Yuan fixing some 0.5% lower, the biggest drop since the August devaluation, all hell broke loose and unleashed a global selling panic after China's stock market was promptly shut down less than 30 minutes into trading, then European shares dropped the most in more than 4 months as Asian equities plunges, as did US stock futures, the dollar weakened against the euro and the yen; crude plunged to fresh 12 year lows. Gold rose.

In a move that could very well lead Iran to take the "proxy" out of Yemen's proxy war, Saudi Arabia has reportedly bombed the Iranian embassy in Sana'a, injuring staff in what Tehran says was a "deliberate" attack. "My classmate and I were at recess when a huge explosion hit the neighborhood. We ran to the side and she fell to the ground in fear."

Surging volatility in global equity, currency, and credit markets and significant stress in a major world economy have George Soros on edge. Speaking at an economic forum in Sri Lanka, the billionaire hedge fund manager warned global markets are facing a crisis and investors need to be very cautious. On the heels of the second trading halt in four days, Soros exclaimed "I would say it amounts to a crisis... which reminds me of 2008."

Will the scheme by the One Bank and India’s government to steal some/most/all of the 20,000 tonnes of privately held gold in India be successful?

And pass the popcorn

Obama's Keystone pipeline rejection "mission accomplished" banner has just led to a big slap on the face of the former constitutional expert, and could carry a multi-billion dollar chage after late this afternoon, TransCanada filed a lawsuit in Federal court in Houston, suing the U.S. government and claiming the Obama acted unconstitutionally when he rejected the Keystone XL, while also seeking $15 billion alleging the pipeline denial was "arbitrary and unjustified."

"These people that we welcomed just three months ago with teddy bears and water bottles ... started shooting at the cathedral dome and started shooting at police. Well seasoned police officers then confessed to me that they never saw something like this in their entire lives."

American justice is a joke. It does not exist. The USA is a lawless country. By that we do not mean what conservative Republicans mean, which is, if we understand them, that racial minorities violate law with something close to impunity. What we mean is that only the mega-banks and the One Percent have legal protection, and that is because these people control the government. For everyone else law is a weapon in the hands of the government to be used against the American people.

“There’s always the possibility of keeping a certain distance of more than an arm’s length – that is to say to make sure yourself you don’t look to be too close to people who are not known to you, and to whom you don’t have a trusting relationship. We need to explain to people from other cultures that the jolly and frisky attitude during our Carnival is not a sign of sexual openness."

For more than four decades Washington’s middle eastern policy has been dead wrong and increasingly counter-productive and destructive. Washington’s Mideast policy is predicated on the assumption that the answer to high oil prices and energy security is deployment of the Fifth Fleet to the Persian Gulf. And that an associated alliance with one of the most corrupt, despotic, avaricious and benighted tyrannies in the modern world is the lynch pin to regional stability and US national security. Nothing could be further from the truth. The House of Saud is a scourge on mankind that would have been eliminated decades ago, save for Imperial Washington’s deplorable coddling and massive transfer of arms and political support.

Surely, The PBOC will step in at some point and save the collapsing currency? Nope - not if options traders (and Kyle Bass) are to be believed. The odds of the yuan breaking beyond 7 to the greenback by the end of March more than doubled to 12% (from 5.8% at the start of December). Ironically, Bloomberg reports only 1 of 39 analyst predicts Yuan to trade beyond 7 by the end of 2016. The market's extremely strong conviction, and apparent PBOC loss of control is "a dangerous situation for policy-makers" according to one Asian economist.