Crude

ISIS Goes Full-Wall Street, Rigs FX Rates To Generate Extra Profits

According to Reuters, ISIS has learned that when it comes to illicit gains, nothing beats white collar crime. Sure you can rape and pillage and even set out to establish your very own oil trafficking routes, but when it comes to racking up effortless gains, nothing works like rigging rates, a concept those "other" international criminal organizations (banks) figured out long ago.

Oil Market Shrugs At OPEC Jawboning

70% of the supply glut in crude is the US's fault, OPEC figures. And the cartel just can't seem to figure out how to "tackle" the problem.

Iraq On The Brink Of Chaos As Oil Revenues Fall

Nowhere are the stakes higher than in Iraq, and selling oil at half the price it would take to just break even could break this giant’s back. It certainly isn’t enough to stave off the unrest in Basra, not to mention the ISIS threat.

WTI Surges Above $33 Despite IEA 'Glutter'-For-Longer Warnings

WTI crude prices are up almost 6% this morning with April (the new front-month) trading above $33.50 - testing post-DOE plunge stops. The irony of the ramp is that it comes amid terrible global PMIs (demand), a report from IEA of oil staying in glut for longer than expected (supply), and warnings from Abu Dhabi's biggest bank that $20 oil is possible. Oh well, we are sure the algos know what they are doing... despite veterans of the 1980s oil glut warning it could take 7 to 10 years to emerge from the current slump.

Frontrunning: February 22

  • Futures sharply higher as oil extends gains (Reuters)
  • Global Stocks Gain on Rising Commodities Prices, China (WSJ)
  • Pound in freefall as Boris Johnson sparks Brexit fears (Telegraph)
  • Pound Slides Most Since 2009 as Johnson Backs ‘Brexit’ Campaign (BBG)
  • Oil Glut Will Persist Into 2017 as IEA Sees Prices Capped (BBG)
  • Japanese Seeking a Place to Stash Cash Start Snapping Up Safes (WSJ)

Markets Surge On Chinese Debt Flood; Worst European PMI In Over A Year; Crashing Pound

Propped up by the Chinese central bank and by a generous Chinese finance ministry, with further hopes a backsliding European economy will mean even more easing by Draghi, the risk on mood is back: "People are willing to take risk again,” Karl Goody, a private wealth manager at Shaw and Partners Ltd. in Sydney told Bloomberg. “People are looking at the selloff this year and saying: enough is enough, there’s been enough pain now."

Were We Lied Into War?

Yes, we know, this is a “conspiracy theory,” and therefore we aren’t allowed to consider it, let alone examine the facts that back it up. Nations never engage in conspiracies, and government officials never lie. But, Trump has ripped the bandage off the gaping and still suppurating wound of that ill-begotten war, and the howls of rage and pain are being heard on both sides of the political spectrum.

"Reversal Risk": Goldman Documents The History Of Central Bank Backpedaling

Things got off to a rather inauspicious start this year in the wake of the Fed's move to hike rates in December. Now, with policy divergence between the Fed and its DM counterparts set to support the dollar at the expense of both EM stability and US corporate profits and with the continual weakness in crude set to trigger a default cycle, the FOMC faces a rather vexing question: “is it better to admit to a policy mistake and reverse course at the risk of destroying credibility or is it preferable to cling to the narrative so as not to completely destroy the notion that all is well and the US recovery is on track?”  

Silver Linings: Keynesian Central Banking Is Heading For A Massive Repudiation

Inflation targeting has been a giant cover story for a monumental power grab. The academics who grabbed the power had no idea what they were doing in the financial markets that they have now saturated with financial time bombs. When these FEDs (financial explosive devices) erupt in the months and years ahead, the central bankers will face a day of reckoning. And they will surely be found wanting. The immense social damage from the imploding bubbles dead ahead will be squarely on them.

The World Is Red

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

The Global Oil Glut Is So Great, Tankers Take The Long Route Around Africa To Find A Buyer

Inbound cargoes take longer voyages, which allows more time to find a buyer, or onshore storage space. Many cargoes from the Middle East and India have diverted around the Cape of Agulhas, at the southernmost point of Africa, on their way to Europe rather than passing through the Suez Canal in Egypt. The longer trip takes 30-40 days instead of the 15-20 day journey through the Suez Canal.