Archive - Jun 15, 2014 - Story

ISIS militants boasted on Twitter that they had executed 1,700 Iraqi government soldiers, posting gruesome photos to support their claim. If the claim is true, it would be the worst mass atrocity in either Syria or Iraq in recent years, surpassing even the chemical weapons attacks in the Syrian suburbs of Damascus last year, which killed 1,400 people and were attributed to the Syrian government.

As the 'negotiations' between Europe, Ukraine, and Russia were taking place this afternoon, technically unconfirmed reports of convoys of Russian military vehicles moving towards the Ukraine border were growing. As the 2amET gas-cut-off deadline looms, it appears Putin is mobilizing a significant force ahead of what will likely mean retaliatory actions by either Ukraine military forces or Ukraine militants. As InfoResist reports, up to 200 units are moving towards Ukraine from Kaluga and in the Rostov region, Russia.

About a month ago we showed photos of the Chinese police engaged in a drill designed to crush a "working class insurrection", in which the police did precisely what would be required to end a middle class rebellion. It made us wonder: what does China know that the US doesn't. As it turns out, nothing. Because long before China was practicing counter-riot ops using rubber bullets, all the way back in 2008, the US Department of Defense was conducting studies on the dynamics of civil unrest, and how the US military might best respond. The name of the project: "Minerva Research Initiative" and its role is to " “improve DoD’s basic understanding of the social, cultural, behavioral and political forces that shape regions of the world of strategic importance to the U.S." The premise behind Minerva is simple: study how violent political overthrow, aka mass civil breakdown, happens in the day and age of social networks, and be prepared to counteract it - by "targeting peaceful activities and protest movements" - when it finally reaches US shores.

Idiot central-planner and economist "justifications" for always being wrong aside, the reality is that El Nino is on its way even if the slowdown in the economy will be due to every other factor except the weather (start with the Fed) which just so happens is a "recurring" event. So upcoming GDP collapse (that nobody could have foreseen earlier, nobody, certainly not the Fed) notwithstanding, here is what one should really expect as a result of the unique weather formation which whose temperature and precipitation impacts across the United States occur during the cold half of the year, from October through March.

What do Scottish independence, UKIP, self-employment, cryptocurrencies and the black economy have in common? The neo-liberal establishment wont fix itself, so for those fed up with banging their heads against policy brickwalls, there’s only one direction. Separate.

As suspected given the huge distance between the bid and offer, the EU-brokered Ukraine-Russia gas deal has failed:

• *GAZPROM CEO MILLER LEAVES SITE OF UKRAINE GAS TALKS, SAYS TALKS ENDED, DEADLINE WON'T CHANGE
  
• *RUSSIA REJECTED EU'S GAS PROPOSAL: OETTINGER; UKRAINE WAS READY TO ACCEPT EU PROPOSAL ($300-$385)
  

Gazprom seeks $1.95bn from Ukraine for past shipments of gas by the 10am Moscow time deadline (2amET) and will continue to seek upfront payments for any further shipments.

With the president stuck schmoozing with donors, house hunting, and always improving his short game (like right now), while the US is preparing to launch the third war of Iraqi liberation  (from the same Al Qaeda Jihadists the US is arming across the border in Syria), the question on everyone's mind is a simple one: whose golf game is better: Obama's or Dubya's. The answer, courtesy of Mark Knoller, is a no contest.

Earlier today we reported that despite, or rather due to, all the confusing propaganda from either side, it was not exactly clear whether and how far away from Baghdad the ISIS offensive had been halted (if at all). It appears the confusion has also impacted none other than the US State Department, which moments ago announced it would evacuate an "substantial number" of the whopping 5,500 staff situated in the US embassy in Baghdad on the banks of the Tigris river, staff which incidentally is the largest of any US embassy. Additionally, the State Dept said that some additional U.S. govt security personnel will be added to Baghdad staff as result of instability and violence in certain areas of Iraq.

Yesterday, Polish magazine Wprost released a recording of a meeting between Interior Minister Bartlomiej Sienkiewicz and central bank Governor Marek Belka which took place in a Warsaw restaurant in July 2013. In the recording, Belka told the minister he would be willing to help the government out of its economic troubles if the finance minister was fired. And there goes the myth of impartial, apolitical central banks...

With the 2014 calendar nearly half way done, and the macro hedge fund community not only underperforming the S&P 500 for the 6th year in a row, but generating a negative return YTD, what is a macro hedge fund universe to do? Why lose all pretense of being sophisticated fundamental trend pickers and do what Bernanke and Yellen have been forcing everyone to do from day one: go all in stocks of course! According to JPM as of this moment there is no difference in the positioning of both traditional long/short hedge funds and macro funds, both of which have increased their equity exposure to the highest since May 2011!

While barely covered in the western media as a result of the curious blackout of recent developments in the Ukraine civil war, for nearly a month Ukraine has had a new president, 48 year old billionaire businessman, Petro Poroshenko. In order to cut through the fog, we decided to go straight to the source on what the US has to say about the country's new leader, who for now at least, appears to be in the good graces of both Putin and the US, namely the leaked Wikileaks cables. Readers will hardly be surprised to learn that he features quite prominently.