Archive - Mar 2014 - Story

With at least 300,000 German jobs dependent on business relations with Russia, it is hardly surprising that, as Reuters reports, several top German executives have criticized the strategy of the U.S. and Europe in dealing with Russia fearing the consequences for their businesses. On the heels of Siemens CEO's comments (as we noted here) that "you don’t want to sanction anyone you depend on,” a number of other senior German executives have commented that that great change could be achieved if the West cooperated with Russia rather than being confrontational. Deutsche Post's Appel summed it up, "Since we don't have major sources of raw materials in Europe, we will always be dependent on others... and it seems questionable to me whether dependence on the Middle East or Venezuela would be better than that on Russia."

There are just hours left until the formal March 31 deadline (although at this point so many deadlines have been extended it is not quite clear just which deadline this is) to sign up for Obamacare. Or rather, to put Obamacare in your check out basket with the intention of paying... at some indefinite time in the future. So instead of rehashing and repeating all the things that have already been said countless times about Obamacare, below we show some of the best cartoons laying out the tragicomedy that is Obamacare by Politico's Matt Wuerker.

One of the big problems in America today is that a lot of people simply do not seem to care about what they are doing anymore.  The level of sloth, laziness and apathy that we are witnessing in this country is absolutely mind-numbing.  Of course this is not true of everyone.  There are still many Americans that are extremely hard working.  But overall, it really appears that people are not taking as much pride in their work as they once did.  Some of the examples below are quite funny; others are more than just a little bit disturbing.  But they all have a common theme.  Americans from all walks of life are simply giving up.  Whether they are teachers, delivery people or fast food workers, the truth is that there are a whole lot of people out there that seem to have mentally checked out.

Both the entire month of March, and its last full week, particularly for biotech investors and especially hedge funds, is a time that many would rather forget and continue pretending that the saying "as January goes, so goes the year" is no longer applicable. Luckily, for all those bulls who have forgotten that in a normal market there is both return and risk, at least in pre-New Normal times, there may be some good news. As Bank of America's chief technician MacNeil Curry reminds us, April is the least cruel month for stocks, posting the highest monthly average return since 1950, returning just over 2.0%.

No tree grows to the sky. Once extremes are reached, trends reverse, often with symmetry: the decline often matches the ascent. Which leads to an interesting question: have we reached Peak Putin? The capture of a few pawns has cleared the chessboard, but the strategic choices already made have greatly reduced Putin's room to maneuver.

A week after initial votes showed the far-right anti-Euro National Front party gaining ground in French municipal elections, it appears the ongoing disappointment in the ruling Socialists is increasing (amid record joblessness).

• *FAR RIGHT MAKES FURTHER GAINS IN FRENCH MUNI ELECTIONS
• *MOSCOVICI SAYS TODAY'S  ELECTIONS 'UNQUESTIONABLY A DEFEAT'
• *MOSCOVICI SAYS IT'S 'DIFFICULT TO REFORM FRANCE'

These are the first nationwide elections in France since Hollande took office and point to rather concerning lack of support for his party and his policies (and the core of the EU); but a record high 38.5% of votes abstained suggesting major apathy as the country's north-south divide grows.

Last week in the markets was all about what was happening below the calm surface waters, which saw the DJIA post a tiny increase and the S&P dip just a fraction. If one was going off merely by the two main indices, one would certainly have missed the drubbing that tech and specifically biotech stocks suffered. However, nowhere was it worse than in the "hedge fund hotel" basket of names most near and dear to the hearts of hedge funds, and respectively those most hated, one which Goldman defines as the long Very Important Positions <GSTHHVIP> vs. short Very Important Shorts <GSTHVISP>. It was here that P&Ls saw one of the worst weekly losses for hedge fund positions since 2001.

While many have pointed out that the Middle-East/Far-East are drifting to a more "Orwellian" world and the West is a more "Huxleyan" environ, the merger of the two dystopias is seemingly growing each day. As The Guardian previously noted, Huxley's dystopia is a totalitarian society, ruled by a supposedly benevolent dictatorship whose subjects have been programmed to enjoy their subjugation through conditioning and the use of a narcotic drug - the rulers of Brave New World have solved the problem of making people love their servitude. On the Orwellian front, we are doing rather well – as the revelations of Edward Snowden have recently underlined. We have constructed an architecture of state surveillance that would make Orwell gasp. The most striking parallel of course is that both men foresaw the future as totalitarian rather than democratic and free. Both Big Brother’s world and the Brave New World are ruled by authoritarian elites of a basically socialist/communist nature, whose only real purpose is the maintenance of their own power and privileges.

IIn a country which has banned the free flow of information via social networks and other venues in order to preserve the corrupt government, why one would believe any official data is unclear, but for those who are curious, here are the early results from today's municipal elections (where eight people have already died as fights broke out between rival candidates in two villages near the southeastern border with Syria): with 12.4% of ballots counted, the ruling AKP party appears to be a blowout victory, with 48.1% of the vote, while CHP has 24% and MHP is at 13.8%, based on CNNTurk reporting. And, as expected, there are huge discrepancies between the numbers provided by the state run news agencies, and the pro-Gulen, Cihan, news agency.

American exceptionalism is a common theme in any policy debate surrounding the United States. We have to protect American manufacturing, protectionists ignorant of economics argue, because America is exceptional. We have to pass expansive welfare programs to care for the poor, because America is exceptional. Most recently, we have to intervene in the conflict between Russia and Ukraine, because America is exceptional. Why the imputed exceptionalism requires one country to police the world and meddle in matters that do not concern them remains unexplained.

Widening income disparity has been a feature of many advanced and developing economies for the past few years and has myriad investment implications. As we noted yesterday, the USA is at levels of income disparity not seen since the roaring 20s (and by some counts worse) but how does that stack up to the rest of the world? Fed fans will be proud to say that once again USA in Number 1... in global income inequality.

"The war mongers will continue to use propaganda and misinformation to convince you we are in danger if the war budget is cut by 2%. The truth is that we need to cut the military by 50%, stop trying to operate a world empire, and withdrawal our troops from Germany, Japan, and the dozens of other countries around the globe. We need to stop handing billions of dollars we don’t have to Israel, Egypt and dozens of other countries so they can buy arms from our arms dealers. We are the cause of all the war and violence in this world. The job of our military is to protect our borders, not to police the world. Hubris, arrogance, and overreach, financed by central bank created debt, is how empires die."

Over the past month, there has been a lot of "Hilsenrathing", or the biased media urgently "explaining" to the Western world, just what Russia's actions mean both tactically in response to Ukraine developments, and strategically as part of Putin's global perspective. So instead of relying on the broken media narrative which serves merely to perpetuate US corporate interests and rally the public behind this or that company's geopolitical interests, here, straight from the horse's mouth, in this case Russian foreign minister Sergey Lavrov, how Russia sees itself in a world in which it is allegedly "isolated", and "threatening Ukraine" with further invasion but more importantly, how the Russians view the rapidly changing global balance of power, in which post-USSR Russia has emerged from the backwood of slighted nations and stormed to the stage of nations who dare defy the former global hegemon, the US.

It just hasn't been JPMorgan's year. Or several years for that matter. The bank which has been on a steady downward slope when it comes to paying billions in quarterly "non-recurring, one-time" legal settlements and charges, and for which engaging in criminal behavior which is neither admitted nor denied, yet which has cost JPM nearly $30 billion in the past several years, has just had its latest "wristslapping" incident, one which involves none other than the recently departed CEO of JPM Asia, Fang Fang, whose office was raided on March 26 by Hong Kong's anti-corruption agency amid a U.S. investigation into the bank’s hiring practices as reported by Bloomberg.

Diplomatic relations can be roughly categorized into realism (utilitarianism) and idealism (led by ideology and philosophy). Although realism has been dominant in modern times, idealism has seemingly been everywhere and nowhere - U.S. is a realist with ideals, while China is a realistic idealist. The “realism” of each country is more or less the same, but the ideals are not. The U.S. adores liberty and democracy while China worships the idea of a socialist democracy with Chinese characteristics. It’s because of such compromises and concessions by the U.S. and China that “new type great power relations” becomes possible. Russia, however, is a realist through and through. Of course, you can’t blame Russia for this…