Russia’s decision to greatly reduce its military presence in Syria, coming as it did with little warning, has left the world struggling for explanations. Russia is to maintain a military presence at its naval base in Tartous and at the Khmeymim airbase. In fact Russia is “withdrawing without withdrawing”. By re-establishing the Assad government in Syria, and permanently placing its forces at Syrian bases, the Russian’s have placed an impenetrable obstacle to the development of the Qatar gas pipeline.
Did you just trade in your €500 note for five €100s? You're probably a criminal, Greece reckons.
At the same time as the PBOC was cautioning about the dangers of excess debt (just as it injected a record amount of loans into the financial system), China's central bank warned about dangers from a stock market bubble, and perhaps just to assure the bubble gets even bigger, at the same time China eased on margin debt limits, in the process sending Chinese stocks soaring higher by 2.2%, and pushing the Shanghai Composite over 3000 for the first time in months as China now appears set to attempt another housing bubble "soft landing" while at the same time restarting its housing bubble.
"No modern welfare state has had an inflow of refugees per capita that’s equivalent to Sweden’s...We’ve gone past the breaking point... people may start wondering whether it's worth paying taxes."
Negative interest rates are a tax! Not a traditional tax paid to the government, but an expense paid, on savings. Years of policy designed to encourage spending and discourage savings is likely reaching the end game; the point where those exhibiting prudence must be punished to keep the game going. At some point, and likely soon, central bankers will be forced to realize the efficacy of lowering interest rates is vanishing and is hindering achievement of their goals. When this occurs a paradigm shift in the way monetary policy is conducted will likely occur. Investors that understand this dynamic, and what it portends, will be in a much better position to protect and profit from the asset price adjustments that lie ahead.
Earlier this month, a reader noticed something rather disturbing. Piraeus Bank seemed to have added a new line item in one of its reports and that new line item appeared to suggest that the bank was set to charge customers for exchanging €500 notes for smaller bills. Sure enough, two weeks later, our suspicions are confirmed.
The migrant crisis is over and Europe is fixed. Turkish PM Ahmet Davutoglu was in Brussels on Friday in an effort to hammer out a deal with EU officials that will help stem the flow of asylum seekers into Western Europe. As it turns out, eurocrats aren't very good at negotiating with an autocrat's messenger, which is why Europe came away with a set of promises that are impossible to enforce and Erdogan got €6 billion plus accelerated EU membership.
The timing of the Russian withdrawal could not be more fortuitous, as it occurs at the very pinnacle of the European refugee crisis, a crisis that was caused by Europe’s backing of the Saudi-Turkish attempt to overthrow Assad. Is Russia gambling on receiving some modicum of European gratitude for helping to stem the flight of refugees to its borders, with the pay-off in terms of easing sanction and enabling its long stalled pipeline projects to be completed.
Risk assets are up because "investors reassessed" the ECB announcement. Really? That's what happened? Real world investors stayed up till the wee hours last night and en masse concluded that they had just gotten it completely wrong yesterday? How about this for an alternative explanation: the allocation heads at one or two European mega-insurance firms were informed that they would be supporting risk assets this morning, the Narrative machine got into gear, and real world investors do what they always do, they play the Common Knowledge Game.
Hundreds of refugees from a camp in northern Greece have managed to get around a border fence and cross into Macedonia, according to a Macedonian police spokeswoman. However, a Reuters photographer estimated the number to be closer to 2,000. As the following live feed shows, the flood of refugees continues...
Less than 24 hours after European stocks tumbled on initial disappointment by Draghi's announcement that rates will not be cut further, mood has changed dramatically and the result has been that after "reassessing" the ECB kitchen sink stimulus, risk has soared overnight with both Asian and European stocks surging. As of this moment European bourses are all broadly higher led by banks, with the DAX and FTSE both up over 2.7%, while the Stoxx 600 is higher by 2.3% as of this writing.
Millennials. They may not yet be the present, but they’re certainly the future. These young, uninitiated minds will someday soon become our politicians, doctors, scientists, chefs, television producers, fashion designers, manufacturers, and, one would hope, the new proponents of liberty. But are they ready for it? It’s time millennials understood these 7 harsh realities of life so we don’t end up with a generation of gutless adult babies running the show.
With China's Plunge Protection Team having intervened and set a positive spin on another poor session, traders put declines in Asia behind them as European markets rose along with U.S. index futures and commodities. European shares advanced for the first time in three days on speculation the region’s central bank will ramp up monetary stimulus on Thursday. A gauge of raw materials rebounded from its biggest selloff in a month, buoyed by gains in oil and copper. Furthermore, the previously noted selloff in Japanese government bonds - one which triggered circuit breakers and which some speculated may have been precipitated by the BOJ itself - dragged Treasuries and German bunds lower, gold fell a second day and the euro dropped versus most of its major peers.