Japan, Libya and Yemen Black Swan Formation Update

Tyler Durden's picture

While US stock futures continue doing their own thing, primarily on the back of JPMorgan's $20 billion financing for AT&T to buy T-Mobile (gotta love proximity to the discount window and/or excess reserves), with ES surging by 16 points overnight (but not Sprint - sorry guys, you are on your own) after the world apparently did not end, the black swan formation refuses to disperse. Here is the latest news update from Japan, Libya, and Yemen.

As Reuters reports, despite ongoing lies to the contrary, the situation in Fukushima has not improved much, and per the latest update there is in fact a fresh bout of smoke from the critically reactor #3 but also from the seemingly under control reactor #2: "The operator of Japan's tsunami-damaged nuclear power complex said on Monday it did not know the cause of smoke rising from two of the plant's six reactors. The smoke began to rise from the plant's No.2 and No.3 reactors on Monday, just as authorities had begun to show signs of progress in its efforts to avert nuclear disaster at the site." Of course this news has been offset with more news of improvement at reactors #5 and 6 which are completely irrelevant and have been under control from the beginning. Market ignores: QE3 will fix it.

In Yemen, the situation is about to get completely out of control, as tanks are now involved against protesters following the defection of a top general. From Al Arabiya: "Tanks were deployed outside the presidential palace in Yemen on Monday, as a top general announced his allegiance to the protest movement seeking to oust President Ali Abdallah Saleh from power. Tanks took up positions in key locations across Sanaa including at the presidential palace, the central bank and the ministry of defense, an AFP correspondent saw. The deployment came as General Ali Mohsen al-Ahmar, an armored infantry division commander, announced that he had joined the "revolution" along with other senior officers. Ahmar is the most senior military officer to pledge support for the opposition, which has been agitating for weeks to end Saleh's 32-year rule over the impoverished, tribal country. His pledge comes a day after Saleh sacked his cabinet in a bid to placate opposition calls for sweeping reforms. The defection of top military officers to the opposition is likely to complicate Washington's support for Saleh, whom it sees as a pillar of stability in a volatile country and a partner in the war against al-Qaeda."

And last, in Libya, the pounding continues even as Gaddafi is now said to be using human shields to prevent additional incursions by a crusading force which as we noted yesterday is seeing a split in its ranks with the Arab League now openly disagreeding with the offensive tactics. From Reuters: "Forces loyal to Libyan leader Muammar Gaddafi
are bringing civilians from nearby towns to the rebel-held city of
Misrata to use as human shields, a rebel spokesman told Reuters on
Monday. The report from Misrata, the only big rebel stronghold
left in western Libya, could not be independently verified and there was
no immediate comment from Libyan officials. Residents also said
that armed pro-Gaddafi forces had entered the city dressed in civilian
clothes and that snipers posted on rooftops were shooting anyone who
came within range. "The Gaddafi forces are forcing people from
Zawiyat al Mahjoub and Al Ghiran out of their houses and giving them
Gaddafi's pictures and the (official Libyan) green flag to chant for
Gaddafi," Hassan, a rebel spokesman, told Reuters."They are
bringing them to Misrata so they can enter the city and control it by
using the civilians as human shields because they know we are not going
to shoot woman and children and old people," he said by telephone from
Misrata."

In typical efficient market fashion, none of this will matter as the bipolar lemming herd lurches from one extreme to another, reacting to each and every headline in a way that confirms no proactive investment thesis can work for a long time again.

For those keeping a closer eye, here is the latest Fukushima data from Reuters:

- The World Health Organisation says the
detection of radiation in food is a more serious problem than first
expected, and food contamination is not a localised problem. It says,
however, there is no evidence of contaminated food from Fukushima
reaching other countries.

- China and South Korea say they will
toughen radioactivity tests on imports of Japanese food, and Japan tells
four prefectures near the nuclear plant to halt shipments of spinach.

- Government also bans milk shipments from Fukushima province.

* Government says Japanese foods produced outside the nuclear crisis zone is safe

- Official death toll from earthquake and tsunami 8,450 with 12,931
missing. Police say more than 15,000 feared dead in Miyagi prefecture
alone.

* The U.N. atomic agency chief said on Monday that
Japan's nuclear situation remained very serious but that he had no doubt
the country would "effectively overcome" the crisis.

- Japan's
nuclear safety agency says it sees risk of radioactive dust being
inhaled by workers at stricken Fukushima Daiichi nuclear power plant,
but there are no signs that has happened yet.

- Reactors at
the Daiichi nuclear power plant are showing some improvement but the
situation remains uncertain, Tetsuro Fukuyama, Japan's deputy chief
cabinet secretary, says.

* Smoke rises from the plant's No. 2
and No. 3 reactors, but the operator says it does not know the cause.
Smoke began to rise just as authorities had begun to show signs of
progress in their efforts to avert nuclear disaster.

- Engineers
have re-established power cables to all six reactors. Electricity
restored at No. 2 reactor and a pump in reactor No. 5 is now running on
power from grid.

- If engineers are unable to cool the reactor,
the last option would be entombing the plant with concrete and sand to
prevent a catastrophic radiation leak, the method used at Chernobyl in
Ukraine in 1986.

- Tests detect radiation above the national
safety level in spinach and milk produced near the Fukushima plant. A
sample of tap water from Tokyo shows a tiny level of radioactive.

- The health ministry said that radiation levels exceeded safety
standards in Fukushima and nearby Ibaraki prefecture. It said it had
prohibited the sale of raw milk from Fukushima prefecture.

- The
earthquake and tsunami will depress growth briefly before
reconstruction kicks off and gives the beleaguered economy a boost, the
World Bank says in a report.