If yesterday the bombardment, no pun intended, of bad news from around the globe was too much even for Mahwah's vacuum tubes to spin as bullish - for stocks - news, then tonight's macro economic updates have so far been hardly as bombastic, with the only real news of the day has Germany's IFO Business Climate reading, which dropped from 106.3 to 105.8, declining for the 5th month in a row, missing expectations, and printing at the lowest level of since April 2013! (More from Goldman below) Net result: Bunds yields were once again pushed in the sub-1% category, even if stocks today are higher because the European data is "so bad it means the ECB has no choice but to do (public instead of just private) QE" blah blah blah.
A day after US ambassador to The UN Samantha Powers stated, "we will not do the airstrikes alone if the president decides to do the airstrikes," and Russia warned, "bombing Syria without the cooperation of Damascus can have destructive practical consequences on the humanitarian situation in Syria," it appears President Obama's grand strategy to combat IS via a 'broad coalition' of allies is flailing. While the WSJ reports, The Pentagon is preparing war plans in Syria that would include an intensive initial wave of strikes against Islamic State targets, Germany's Foreign Minister Frank-Walter Steinmeier explained today that providing air support or sending ground troops to fight Islamic State is "out of the question for us." For now, it appears, the only nation involved in the 'broad coalition' is France. Why? Because as we said yesterday, this is merely over fears of more BNPs. "A key component of this would be allied participation," said a U.S. official; does '1' ally count?
US imperialism was once a fearsome force - mainly for ill. Under the latter heading, Washington’s savage destruction of Vietnam four decades ago comes readily to mind. But now the American Imperium has become just a gong show on the Potomac - even as its weapons have gotten more lethal and its purposes more spurious and convoluted. There is no more conspicuous proof than Obama’s quixotic “war” on ISIS.
The President pledges "no combat troops" in Iraq. The head of the Joint Chiefs of Staff, Gen. Martin Dempsey, says he may recommend combat ground troops in the battle against ISIS. The President, in a speech, reiterates "no ground troops," and "no combat troops." In short, when it comes to the making of American foreign policy what we have in Washington is what appears to be the functional definition of anarchy!
Whatever Russia does, doubt does not even enter the equation. The answer is sanctions. So here we go again. No one ever lost money betting on the stupidity of the usual, unknown “senior US officials” – who are now spinning the latest sanction package is to force Moscow to “respect international law and state sovereignty.” A cursory examination of the historical record allows this paragraph to be accompanied by roaring laughter. As for Russia’s "isolation", companies are barred from, in Washington-Wall Street newspeak, "important dollar-denominated funding sources." Or, euphemistically, "Western capital." This means the US dollar and the euro. Anyone following superimposed moves towards a multipolar world knows Russia does not need more US dollars and euro.
For climate change activists and those hoping for an energy future dominated by renewables or even less-polluting natural gas, the death of coal cannot come quickly enough. But with coal still the dominant form of cheap electricity throughout the world, it is unlikely the bogeyman of climate change will disappear anytime soon.
The idea that the Obama administration has the budget deficit under control is a complete and total lie. The U.S. national debt has actually grown by more than a trillion dollars in less than 12 months. We continue to wildly run up debt as if there is no tomorrow, and by doing so we are destroying the future of this nation.
Smuggled oil could be a pivotal issue for the U.S. as it seeks to destroy IS. The militant group sells oil at a reduced price – perhaps around $25 per barrel. At first, it sold the oil to middlemen, who moved the oil to Iran, Syria, Jordan and Turkey. But as IS’ operations grew, they forced out the middlemen, beat back other militant groups, and are now providing security to their own convoys of oil tanker trucks heading out of their territory to market. Air strikes may succeed in destroying vehicles and other military equipment under IS control, but cutting off the flow of money – specifically from oil smuggling – will likely go further in weakening the Islamic State.
Who could have seen this coming? In yet another example of untruthiness, it appears, according to Joint Chiefs of Staff Chairman Martin Dempsey, testifying before the Senate Armed Services Committee this morning, President Obama would back U.S. advisers accompanying Iraqi troops in battle to combat Islamic State militants if necessary. For now, Dempsey noted, Iraqi security forces are "doing fine," but as Republican, Sen. Jim Inhofe noted, "it is foolhardy for the Obama administration to tie its hands and so firmly rule out the possibility of special operators on the ground." Following Hagel's remarks that the fight will "not be an easy or a brief effort," Dempsey said if it doesn’t succeed, he would not rule out advising Obama to use U.S. ground forces.
Former BP CEO Warns "Sanctions Will Bite West" As US Gives Majors 14 Days To Wind Down Russian ActivitiesSubmitted by Tyler Durden on 09/14/2014 16:04 -0400
while sanctions until this moment had been largely intended to specifically allow energy companies to continue their status quo in Russia, as of this Friday, it is precisely the E&Ps that are being targeted, as we noted on Friday, and as Reuters follows up today, reporting that some of the world's largest companies, namely Exxon, Anglo-Dutch Royal Dutch Shell, Norway's Statoil and Italian ENI, will have to be put their Russian projects on hold: to wit, the companies will have 14 days to wind-down activities. And yet Russia may once again have the last laugh: enter Tony Hayward, the infamous former CEO of BP (and current Chairman of Glencore) who may have been disgraced by his handling of the Macondo spill but his comments on how the Russian sanctions will play out, are spot on. As the FT reported moments ago, "US and EU sanctions against Moscow are in danger of turning round and biting the west by constraining global oil supply and pushing up prices in coming years, the former chief executive of BP has warned."
"Rudderless and without a compass, the American ship of state continues to drift, guns blazing." While critics have been questioning the legality of U.S. military campaigns consistently since the end of World War II, one trend has become increasingly clear. With each new President and each new war, we have witnessed those who hold the office act more and more like dictators, and less and less like constitutional executives. One very important, and up until recently, overlooked point about Obama’s latest “war on ISIS” is that this is not at all just more of the same. This crosses yet another very important line of shadiness, and if we as as American public allow him to do so, we will suffer grave long-term consequences to our economic future as well as our liberties. This is very serious stuff.
Washington’s Iraq-Syria Policy: Throwing the Ball to a Midget Surrounded by an Entire Team of 7-Foot Basketball PlayersSubmitted by George Washington on 09/12/2014 14:04 -0400
Who Do You THINK Will End Up With the Ball?
Just a few hours ahead of President Obama's strategy oration, we thought worth noting that Americans' trust in the federal government to handle international problems has fallen to a record-low 43%. According to Gallup, confidence in the government to handle international problems slid 17 percentage points last year, when the Obama administration was planning military action against Syria. Unsurprisingly, Democrats remain the most confident in the government as Republicans' faith has collapsed. But it's not just international, only 40% of Americans have any confidence that government can handle domestic problems - also a record low.
For the terrorist group known as the Islamic State, Syria and Iraq were a good place to start their campaign, but in order to survive and prosper it knew from the outset that it had no choice but to set its sights on the ultimate prize: the oil fields of Saudi Arabia.
Last week, Adam Hartung qualified for the "Mark Twain Award" if there was such a thing. In his article, "Obama Outperforms Reagan On Jobs, Growth & Investing," Adam goes to some length to try and show that unemployment rate, the S&P 500 and economic growth are currently better under the current administration than they were during the Reagan administration. Unfortunately, that is not the case. When considering that President Obama has been able to achieve real economic growth of just 2.04% annually despite historically low levels of inflation and interest rates combined with massive government interventions and balance sheet expansions; it makes his overall performance even more disappointing.