Mexico

Frontrunning: July 30

  • Second-quarter GDP seen rebounding on consumer spending, housing (Reuters)
  • China Stocks Fall as Traders Puzzle Over Sudden Late-Day Swings (BBG)
  • European 'alliance of national liberation fronts' emerges to avenge Greek defeat (Telegraph)
  • Thomas Cook warns on earnings over Greece (MW)
  • Largest Greek toy seller Jumbo warns of hit from capital controls (Kathimerini)
  • Chevron and Exxon Get the Plaudits, but Some Smaller Drillers Faring Well (WSJ)
  • Schäuble outlines plan to limit European Commission powers (FT)
  • UBS Deal Shows Clinton’s Complicated Ties (WSJ)

Top Factors Undermining Any Oil Price Recovery

Global oil prices have returned to a state of flux. This is hardly news to any who follow the oil markets closely and yet prices continue to drive international headlines. While oil prices are notoriously difficult to predict, it has failed to deter the speculators. There are those warning that the latest dip is a precursor for $40 a barrel, a catastrophe for oil markets in some minds. On the other end of the spectrum are the optimists betting on a return to $100 by 2020. The World Bank has taken a typically middle-of-the-road approach, with forecasts of $57 a barrel in 2015. That said, given Iran’s potential revitalization, Russia’s murky outlook, and U.S. shale supply limits uncertain, prices will be responsive to supply and demand trends; at least in the short to medium term.

Could Trump Win?

The American political class has failed the country, and should be fired. That is the clearest message from the summer surge of Bernie Sanders and the remarkable rise of Donald Trump. But can Trump win?

Deflation Is Winning - Beware!

Deflation is back on the front burner and it's going to destroy all of the careful central planning and related market manipulation of the past 6 years. Clear signs from the periphery indicate that a destructive deflationary pulse has been unleashed. After years of suppression, the forces of reality are threatening to overwhelm our managed global ""markets"'. And it's about damn time.

The Three Cs Keeping CFOs Up At Night: China, Commodities, Currencies

With two-thirds of companies still set to report, and as the second quarter earnings season continues and assures the first revenue and EPS recession since 2009, the question on everyone's lips is just how bad will/can it get. The answer will be determined largely by any/all of the following three "C"s which continue to define the ugly face of non-GAAP corporate earnings for the past 3 quarters which appear set to persist for the foreseeable future.

Central Banks Have Shot Their Wad - Why The Casino Is In For A Rude Awakening, Part I

There has been a lot of chatter in recent days about the plunge in commodity prices - capped off by this week’s slide of the Bloomberg commodity index to levels not seen since 2002. That epochal development is captured in the chart below, but most of the media gumming about the rapidly accelerating “commodity crunch” misses the essential point. To wit, the central banks of the world have shot their wad.  The Bloomberg Commodity index is a slow motion screen shot depicting the massive intrusion of worldwide central bankers into the global economic and financial system. Their unprecedented spree of money printing took the aggregate global central bank balance sheet from $3 trillion to $22 trillion over the last 15 years. The consequence was a deep and systematic falsification of financial prices on a planet-wide scale.

Frontrunning: July 23

  • Greek PM keeps lid on party rebellion to pass bailout vote (Reuters)
  • Greek Prime Minister Alexis Tsipras Remains Popular Despite Tough Bailout Deal (WSJ)
  • Beijing's stock rescue has $800 billion bark, small market bite (Reuters)
  • Capital exodus from China reaches $800bn as crisis deepens (Telegraph)
  • Why Investors Shy Away From China’s $6.4 Trillion Bond Market (WSJ)
  • Oil Rigs Left Idling Turn Caribbean Into Expensive Parking Lot (BBG)
  • Bank of America replaces CFO in management shake-up (Reuters)
  • The Financial Buzz? Pearson to sell Financial Times (Reuters)

'Trump'ing Political Success Through An Irate Silent Majority

Richard Nixon made hay of the term “Silent majority” back in November 1969 to defend his Vietnam War policy.  It has since been used by American politicians to legitimize and expand the nature of a non-descript huge following they claim as their own, quite often asserting the existence of magnified populism and an implied democracy.  Nixon’s baton seems to have been now passed to Donald Trump, as he submits his candidacy for the highest political office in the land, and grabs the microphone to broadcast his unfiltered stand on immigration.  A message that questionably-qualified experts in the media are quick to devour, then defecate, on a public more receptive to shallow issues dealing with celebrities than anything of social significance or depth. 

Frontrunning: July 22

  • Stocks sour as Apple results leave bitter aftertaste (Reuters)
  • Awkward Alliance Running Germany Exposed by Greek Crisis (BBG)
  • Apple Faces Old Question of What’s Next After Record Profit (BBG)
  • Lawmakers, White House Explore Tax Revamp for U.S. Firms Overseas (WSJ)
  • Digital Misfits Link JPMorgan Hack to Pump-and-Dump Fraud (BBG)
  • More Debt Traders at Risk as European Banks Report Results (BBG)
  • Iran rejects sanctions extension beyond 10 years (Reuters)

Desperate California Farmers Turn To "Water Witches" As Drought Deepens

You know it's bad when... With most of California experiencing "extreme to exceptional drought," and the crisis now in its fourth year, state officials recently unleashed the first cutback to farmers' water rights since 1977, ordering cities and towns to cut water use by as much as 36%. With the drought showing no sign of letting up any time soon, and the state’s agricultural industry suffering (a recent study by UC Davis projected that the drought would cost California’s economy $2.7 billion in 2015 alone), Yahoo reports farmers have begun desperately turning to "water witches" who "dowse" for water sources using rods and sticks.