European Union

US Trade Deficit Widens In May As Exports Tumble Most In 3 Months

The US trade deficit increased from $40.7 bn to $41.8bn, slightly lower than expected. Impoorts fell a mere 0.1% (despite a record amount of imported auto parts) but exports fell 0.8% (driven by a decline in Aircraft sales), nudging GDP expectations lower. The trade deficit with China rose notably and exports to Europe dropped.

Frontrunning: July 7

  • Greece faces last chance to stay in euro as cash runs out (Reuters)
  • Tsipras Begins Brussels Campaign to Keep Greece Inside the Euro (BBG)
  • Greek Crisis Shows How Germany’s Power Polarizes Europe (WSJ)
  • Eurogroup Head Dijsselbloem Calls for ‘Credible’ Greece Package (BBG)
  • Europe Not Playing ‘Domino Theory’ Leaves Markets Calm on Greece (BBG)
  • China stocks fall again despite support measures (Reuters)
  • Chinese Trading Suspensions Freeze $1.4 Trillion of Shares Amid Rout (BBG)
  • Crude Creeps Higher After Downturn (WSJ)

Russia Is Taking Full Advantage Of Greek Crisis

With Greece’s debt situation spiraling downwards, the European project is showing some cracks. The July 5 referendum could end up amounting to a mandate on whether or not Greece stays in the euro. In the meantime, the turmoil offers an opportunity for Russia to advance its interests... and with The Krlemlin reporting that Putin held discussions with Hollande today, it appears something is going on behind the scenes.

With Yanis Gone, Now Troika Heads Must Roll

It’s time for the Troika to seek out some real men too. It cannot be that the winner leaves and all the losers get to stay. The attempts to suppress the IMF debt sustainability analysis were a shameful attempt to mislead the people of Greece, and of Europe as a whole. And don’t forget the US: Lagarde operates out of Washington. It cannot be that after this mockery of democracy, these same people can just remain where they are.

Russia Gloats: "Merkel's Misery Over Broken Europe Dreams"

"After the Greeks voted against accepting the latest demands from its creditors, Merkel is facing her worst nightmare: a possible Greek exit from the euro, a possible exit from the EU completely and loss of confidence in the currency itself.  Half of her was Merkel — the pragmatic economist, the other was Merkel — the great European. She has now discovered, in her vacillation, she has not shown the leadership expected of the most powerful woman in the European Union."

Frontrunning: July 6

  • Greece Bailout Referendum: They Voted ‘No’. Now What? (BBG)
  • Varoufakis Quits as Greece Enters New Showdown With Europe (BBG)
  • Merkel to Meet Hollande as Greece Told to Make Next Move (BBG)
  • German line hardens after Greek referendum 'No' (Reuters)
  • BOJ keeps rosy view of regional Japan, watching markets after Greek upset (Reuters)
  • Oil falls on Greece vote, China stock market turmoil (Reuters)
  • China Urges U.S.-Iran Compromise 36 Hours to Nuclear Deadline (BBG)
  • U.S. and Iran: the unbearable awkwardness of defending your enemy (Reuters)

All The Latest Greek Headlines

With the only thing that matters in the hours ahead, at least until China reopens and the Pandamonium repeats, is the sheer chaos out of Greece which now literally changes the narrative by the minute, here is a convenient timeline of everything that has happened so far this morning starting with Varoufakis' unexpected resignation and going from there.

Marine Le Pen, Anti Euro French Presidential Frontrunner, Applauds Greek Victory Over "EU Oligarchy"

"This 'No' from the Greek people must pave the way for a healthy new approach," said Marine Le Pen.  "European countries should take advantage of this event to gather around the negotiating table, take stock of the failure of the euro and austerity, and organize the dissolution of the single currency system, which is needed to get back to real growth, employment and debt reduction."

The Superpower Conundrum - The Rise and Fall of Just About Everything

The rise and fall of great powers and their imperial domains has been a central fact of history for centuries.  It’s been a sensible, repeatedly validated framework for thinking about the fate of the planet.  So it’s hardly surprising, when faced with a country once regularly labeled the “sole superpower,” “the last superpower,” or even the global “hyperpower” and now, curiously, called nothing whatsoever, that the “decline” question should come up.  Is the U.S. or isn’t it?  Might it or might it not now be on the downhill side of imperial greatness?

The Fourth Turning – An Interview With Neil Howe

"...If the S&P500 were to come down by 50% look at the bright side. The Millennial generation can finally buy into America’s future at a good price. Look at what they are facing right now: very little return on their savings and very lofty prices that they have to pay to invest in their future.  So we often forget that these wrenching dislocating financial events, particularly for older generations, can create opportunities for the young, and often create space for something more durable for the times to be built. So I’ll just summarize it with Schumpeter’s phrase: creative destruction. That’s how I prefer to see what happens in a Fourth Turning."

How Greece Has Fallen Victim To "Economic Hit Men"

"Greece is being 'hit', there's no doubt about it," exclaims John Perkins, author of Confessions of an Economic Hit Man, noting that "[Indebted countries] become servants to what I call the corporatocracy ... today we have a global empire, and it's not an American empire. It's not a national empire... It's a corporate empire, and the big corporations rule."

Beware Of Greeks Bearing Referenda

It appears the sovereign peoples of Europe would not go gently into a Federal States of Europe night. Investors need to prepare for the inevitable political solution: referendums across Europe on the constitution of the Federal States of Europe needed to sustain the Euro. Events this weekend will trigger the search for the democratic legitimacy for the single currency and the centralised constitution it requires... or the demise of the unelected 'king Juncker' and 'queen Lagarde' of the Federal States of Europe.

Is This Why 'Europe' Is Now Trying To Crush Greece?

"...won’t a successful Greece show others that — much as many young people who cannot afford to pay their rent return home — they, too, can return to the way things used to be?..."

Simply put -  Europe can't 'afford' anything positive to come of Greece...

Athens On The Potomac - It Could Never Happen Here, Right?

Financial experts in New York, London, and Brussels have tut-tutted Greece’s economic travails as Athens considers its future with the European Union. Why did they borrow so much money? How can they ever pay it back? Do they think that much debt is sustainable? Instead of pointing fingers at the innumerates running Athens, they should consider our own situation.