India

Farage Threatens To "Destroy The Old EU" As Marc Faber Says Brexit "Best Thing In British History"

The European Union is an "empire that is hugely bureaucratic," warns Marc Faber, telling CNBC that he thinks that "a Brexit would be bullish for global economic growth," because "it would give other countries incentive to leave the badly organized EU." The Gloom, Boom & Doom-er explained that Brexit is a risk Britain should be willing to take, and that it would not be a disaster, "on the contrary, it would be the best thing for Britain that would ever happen!" Rubbing further salt into the wounds of Europe's establishment, outspoken pro-Brexit campaigner Nigel Farage exclaimed that he said he would "destroy the old EU", together with 5-Star leader Beppe Grillo.

The Pentagon's Great Wall Of Impotence

No one ever lost money betting on the Pentagon refraining from exceptionalist rhetoric. As expressed by neocon Carter, Pentagon rhetoric – faithful to its own estimation of China as the second biggest “existential threat” to the US (Russia is first) – revolves around the same themes; US military might and superiority is bound to last forever; we are the “main underwriter of Asian security” for, well, forever; and China better behave in the South China Sea – or else.  So here’s an instant translation: we do a NATO in Asia; we control it; you will answer to us; and then we encircle you – and Russia – for good.

Frontrunning: June 8

  • World stocks struggle to build on highs as Europe weighs (Reuters)
  • Oil hits eight-month high on disruptions, Chinese demand (Reuters)
  • Hillary Clinton Set for Democratic Nomination After Primary Wins (WSJ)
  • DNC avoids calling Clinton presumptive nominee (The Hill)
  • Trump, Rattled by Critics, Treads Carefully in Victory Speech (BBG)

Futures Levitate To Session Highs As ECB Enters The Bond Market; Crude Hits $51

In an overnight session dominated by the latest political developments out of the US where Hillary Clinton officially claimed the democratic nomination, the financial newsflow focused on China's trade data, where exports fell 4.1% from a year earlier, in line with expectations, but imports dropped 0.4% from a year earlier, the smallest decline since they turned negative in November 2014, driven entire by soaring "imports" from Hong Kong - aka capital outflows - which soared by 243% y/y.  The other main news was the official launch of the ECB's corporate bond buying, which helped drive government bonds yields in German to new record lows, and the average yields on investment-grade corporate debt below 1%.

Frontrunning: June 7

  • Soothing Fed sounds send stocks to five-week high (Reuters)
  • Clinton reaches magic number in fight for Democratic nomination (Reuters)
  • Euro-Area Economy Grows Faster as Consumption Gathers Pace (BBG)
  • Trump unyielding on Hispanic judge uproar (Reuters)
  • European Firms Find ‘Increasingly Hostile’ Environment in China (WSJ)
  • China tells U.S. to play constructive South China Sea role (Reuters)

S&P Nears All Time High, Global Stocks Rally As Dovish Yellen Unleashes Animal Spirits

Stock whisperer Yellen said all the right things yesterday, when she sounded more optimistic than pessimistic on the economy but while the economy is "strong" it is most likely not strong enough to weather a rate hike in the immediate future. As a result, the S&P 500 climbed toward a record on Monday (and continued rising overnight) after Yellen said she expects to raise interest rates only gradually and held off from specifying any timeframe, a shift from her May 27 stance that a move was probable “in the coming months.” This was interpreted that both a June and July rate hike are now off the table, with September odds rising modestly.

Iran Oil Exports Soar As Offshore Tanker Armada Comes To Tehran's Rescue

More than 25 European and Asian-owned supertankers are shipping Iranian oil, data seen by Reuters shows, allowing Tehran to ramp up exports much faster than analysts had expected following the lifting of sanctions in January. Iran was struggling as recently as April to find partners to ship its oil, but after an agreement on a temporary insurance fix more than a third of Iran's crude shipments are now being handled by foreign vessels.

Peak Facebook? New Study Finds Social Media App Usage Tumbles Across The Globe

While Facebook's stratospheric ascent to new record highs continues, storm clouds may be gathering for the $340 billion market cap company: according to a new study by marketing intelligence firm Across the board, people are spending less time on their Social Media apps. Using SimilarWeb data on Android apps, the company found that in almost all countries, time spent on the 4 leading Social Media apps is down, in many cases sharply. On Facebook, Snapchat, Instagram, and Twitter, Android users seem to be cutting down on their Social Media app usage time.

Futures Flat Following Friday's Jobs Fiasco: All Eyes On Yellen Again

Every ugly jobs report has a silver lining, and sure enough following Friday's disastrous jobs report, global mining and energy companies rallied alongside commodities after the jobs data crushed speculation the Fed would raise interest rates this month.  “The disappointing U.S. jobs report on Friday means that a summer Fed rate hike is off the table,” said Jens Pedersen, a commodities analyst at Danske Bank. “That has reversed the upwards trend in the dollar, supporting commodities on a broader basis. The market will look for confirmation in Yellen’s speech later today.”

How The "Rest" Of America Lives: Wanting For Work, Buried In Debt

The flyover zones of America are wanting for work and buried in debt. That’s the legacy of three decades of Washington/Wall Street Bubble Finance. The latter has exported jobs, crushed the purchasing power of main street wages and showered the bicoastal elites with the windfalls of financialization. In short, Wall Street loves financial repression because it inflates financial asset values and fuels debt-funded gambling in the casinos. But it’s the opposite of what’s needed in flyover America.

Global Markets Flat, Coiled Ahead Of Today's Risk Events: OPEC And The ECB

There are just two drivers setting the pace for today's risk mood: the OPEC meeting in Vienna which started a few hours ago, and the ECB's announcement as well as Mario Draghi's press statement due out just one hour from now. Both are expected to not reveal any major surprises, with OPEC almost certainly unable to implement a production freeze while the ECB is expected to remain on hold and provide some more details on its corporate bond buying program, although there is some modest risk of upside surprise in either case.

So, You Thought Slavery Was Dead? Think Again

Nearly 46 million human beings are subject to slavery, a new report released this week concluded. According to the third annual Global Slavery Index, which gathers and analyzes surveys conducted by Gallup, the number of people forced into “modern slavery,” or “human trafficking, forced labour, debt bondage, forced or servile marriage or commercial sexual exploitation,” rose from 35.8 million to 45.8 million since 2014 — a 28 percent increase.