European Union

We all know how sectarian, religious and political differences have thrown many Middle Eastern countries into chaos and armed conflict. But there is a deeper factor at play which deserves greater recognition: severe water scarcity.

With the Greek bailout deal now nearly done, all that stands in the way of disbursal is the Greek parliamnent and a predictably incalcitrant Germany which, according to Bild (citing EU sources) has now determined that the new bailout plan is "insufficient."

Too much of the commentary about the Greek crisis has focused on whether or not Greece should drop the euro and not enough on the structural problems arising out of decades of socialism. Meanwhile, the Greek government has borrowed more money than the Greek people can possibly repay, and debased money will not make this fact disappear. On the contrary, more easy money will cause even more harm. The best thing that Europe and Greece can do for itself right now is to confront some of the economic fallacies that have long driven the debate over Greece, the euro, austerity, and debt.

Here is an overview of next week's events and data placed in the larger context.  

"There's a saying, 'if there's peace, it will start from Cizre, and if there's war, it will start from here as well.' And we can say we have a civil war in Turkey."

Deflation is a bitch. The only way the rich can keep getting richer is if the rest of us keep getting poorer. Economic growth is a thing of the past. Deleveraging has started for real. Huge amounts of zombified ‘money’ are disappearing as we speak. That leaves the world with a lot less wealth. And still the rich seek to get richer, and they are in charge. The math is simple... but there is a point when the can gets so big and heavy, no-one can kick it down any road anymore.

What if the assumptions about a U.S. economic recovery and Fed rate hikes were wrong? Could observers be mistaken now about the trajectory of the Dollar vs. the Euro as they were back in 2000? Confidence is the only thing that really undergirds modern fiat currencies. But confidence can be very ephemeral...disappearing as quickly as it arrives. The U.S. Dollar benefits from confidence that the Euro currency may just be unworkable, that the U.S. economy will continue to improve, and that the Fed will raise rates throughout the remainder of 2015 and into 2016. If these expectations are unfulfilled, there could be a Euro reversal.

After a lukewarm start by the Chinese "market", which had dropped for the past 6 out of 7 days despite ever escalating measures by Beijing to manipulate stocks higher, finally the Shanghai Composite reacted favorably to Chinese micromanagement of stock prices and closed 3.7% higher as Chinese regulators stepped up their latest measures by adjusting rules on short-selling in order to reduce trading frequency and price volatility, resulting in several large brokerages suspending short sell operations. At this pace only buy orders will soon be legal which just may send the farce of what was once a "market" limit up.

Just a few short years after they dared to downgrade the US, S&P has unleashed their worst on Europe:

*EUROPEAN UNION OUTLOOK REVISED TO NEGATIVE FROM STABLE BY S&P

We are sure this will be met by S&P office raids throughout Europe, litigation over somethhing or other, and denials broadly from any and every unelected member of EU's elite... because "when it's serious you have to lie."

The IMF made some frowing decisions...

“It is absolutely ludicrous that when only 10% of the entire UK GDP is exports to the EU that the other 90% of our businesses are tied up with European rules – and I think people are starting to understand that.”

• U.S. stock futures slip amid lukewarm earnings, fall in commodities (Reuters)
• Stressful times for low-polling Republicans who may miss debate stage (Reuters)
• Trump shows staying power with surge ahead of first debate (Reuters)
• China Market Manipulation Probe Targets Spoofers After Crash (BBG)
• Beijing Chosen to Host 2022 Winter Olympics (WSJ)
• Obama Warns Support on Iran Deal ’Getting Squishy’ Amid Pressure (BBG)
• Pacific trade negotiators chase elusive final deal in tough talks (Reuters)

Tehran, Beijing, Moscow, Islamabad, and New Delhi have been actively establishing interlocking security guarantees. They have been simultaneously calling the Atlanticist bluff when it comes to the endless drumbeat of attention given to the flimsy meme of Iran’s "nuclear weapons program."  And a few days before the Vienna nuclear negotiations finally culminated in an agreement, all of this came together at a twin BRICS/SCO summit in Ufa, Russia -- a place you’ve undoubtedly never heard of and a meeting that got next to no attention in the U.S.  And yet sooner or later, these developments will ensure that the War Party in Washington and assorted neocons (as well as neoliberalcons) already breathing hard over the Iran deal will sweat bullets as their narratives about how the world works crumble.

"The letter has been sent." Greece formally invites the troika back to Athens sparking anger, resentment among a conquered people.

• Gunman kills two, wounds seven in Louisiana theater before killing himself (Reuters)
• Health insurer Anthem to buy Cigna in $54.2 billion deal (Reuters)
• Murder, Poisoning, Raids: It’s Election Season in Russia (BBG)
• Lagarde Push for Greece Debt Relief Challenges Merkel (Bloomberg)
• Fund Boss’s Gamble on Health Law Pays Off Big (WSJ)
• Wall Street Cranks Up Its Outlook for Amazon After It Delivers Monster Earnings Report (BBG)
• China's Richest Man Marks Push Into Hollywood With Jake Gyllenhaal Movie (BBG)
• West Africa's alarming growth industry - meth (Reuters)