Reuters

Frontrunning: February 13

  • Greece will do 'whatever it can' to reach deal with EU (Reuters)
  • ECB Urges Greek Political Deal as Emergency Cash Is Tight (BBG)
  • Fighting rages in run-up to Ukraine ceasefire (Reuters)
  • Eurozone GDP Picks Up, Thanks to Germany (WSJ)
  • Two J. P. Morgan Executives Connected to Asia Hiring Probe Pushed Out (WSJ)
  • Putin's High Tolerance for Pain and Europe's Reluctance to Inflict It (BBG)
  • Indigestion Hits Top U.S. Food Firms (WSJ)
  • Alibaba's Jack Ma seeks to reassure employees over U.S. lawsuits (Reuters)

German DAX Rises Above 11,000 For First Time After European GDP Surprises To Upside

Who would have thought all it takes for Eurozone Q4 GDP to print above expectations, even if by the smallest of possible margins - one which even the Chinese goalseek-o-tron bows its head down to in respect - which at 0.3% Q/Q was above the 0.2% expected and above Q3's 0.2%, was for Europe to admit it has finally succumbed to deflation. Oh, and for the ECB to admit the situation has never been more serious by launching Q€. Oh, and add the "estimated contribution" to GDP from hookers and drugs. Put all that together and on an annualized basis, the European economy grew by 1.4%. Whatever the reason, Q4 GDP was the best print since Q1, even as Germany blew not only consensus of 0.3%, but the highest GDP estimate of 0.6% out of the water when it reported that courtesy of a spike in spending, its economy grew by 0.7% in the fourth quarter, up from the near-recessionary 0.1% in Q3. That, together with QE and ZIRP now raging across the continent, was enough to push the DAX above 11,000 for the first time ever.

Stealth Greek Bank Run Continues: ECB Hikes Emergency Lending To EUR 65 Billion

It would appear the un-sourced rumors of Greek banks having used up their Emergency line of credit with the ECB are true. Following a hastily put together conference calls this morning:

  • *ECB RAISES GREECE ELA ALLOWANCE TO EU65BN: FAZ

Up from the previous EUR59.5 Billion. It appears the stealth bank run in Greece is showing no signs of slowing.

Greece To ECB: "Get To Work, Mr. Draghi"

With talk that Greek banks have hit their emergency lending limit with the ECB (which has prompted a teleconference this morning among ECB polcy-makers), it seems the newly-found position of negotiating strength for Greece (perhaps encouraged by China or Russia behind the scenes) has prompted more demands:

  • GREECE'S SYRIZA CHIEF ECONOMIST JOHN MILIOS PROPOSES OVERALL EURO ZONE DEBT OVERHANG REDUCTION BY ECB
  • ECB COULD BUY ALL EURO ZONE DEBT MATURING IN 2016-2020 AND ALL INTEREST PAYMENTS-SYRIZA'S MILIOS
  • ECB WOULD FOOT THE BILL NOW, BUT BY 2040 IT WOULD BE ABLE TO ERASE ALL LOSSES THROUGH PROFIT RETENTION-MILIOS

Roughly translated - "Get back to work, Mr.Draghi" and monetize all of Europe's debt. With negative net issuance (i.e. central banks already monetizing over 100% of 2015's expected issuance) already here, this demand merely pushes the 'independent' monetary policymakers to enable more fiscal profligacy.

Frontrunning: February 12

  • 'Glimmer of hope' for Ukraine after deal at Minsk peace summit (Reuters)
  • Ruble Rebounds, Russian Stocks Surge on Ukraine Cease-Fire Deal (BBG)
  • Greek PM Tsipras in Brussels as clock ticks on EU bailout (Reuters)
  • Emerging-Market Currencies Rout Not Over for Traders (BBG)
  • Little noticed, new Saudi king shapes contours of power (Reuters)
  • In Wake of Financial Crisis, Goldman Goes It Alone (WSJ)
  • AmEx Is Losing Its Millionaires (BBG)
  • Thousands to Lose Health Insurance Over Residency Questions (WSJ)

Market Wrap: Whirlwind Manic-Depressive Session Sees Futures Slide Then Surge

So far it has been an overnight session which clearly forgot to take its lithium, with futures first tumbling after CNBC's "leak" that a Greek deal had been reached was refuted, only to surge subsequently on both the Riskbank's foray into NIRP and QE which crushed the Swedish currency and sent its stocks to recorder highs, and more importantly, on the latest ceasefire out of Minsk which has pushed Russian and European assets substantially higher. While only the most naive believe that any palpable end to Ukraine hostilities will emerge as a result of today's delay, expect for Greek headlines to return with a vengeance as today it is Tsipras' turn to speak at a summit of the 28 European Union leaders set to begin momentarily.

Greek Deal Falls Apart After EU Says "No Way Forward", No Eurogroup Statement; Greece "Questions Merit" Of Bailout Extension

Following earlier deal rumors citing 'unidentified sources' stating that:*GREECE AGREEMENT `IN PRINCIPLE' REACHED, GREECE WILL STAY IN EU BAILOUT PROGRAM, DETAILS OF GREECE DEAL UNCLEAR, CNBC REPORTS (after which stocks futures and EURUSD surged), the Eurogroup and Greece have completely denied any progress was made whatsoever...

GREEK GOVT OFFICIAL SAYS NO AGREEMENT IN EUROGROUP, GREECE WILL NOT ACCEPT AN EXTENSION OF CURRENT BAILOUT
DIJSSELBLOEM: NO STATEMENT POSSIBLE WITHOUT JOINT CONCLUSIONS
GREECE WOULD NEVER AGREE TO STAY IN CURRENT PROGRAM: VAROUFAKIS

Austria's 3rd Largest Bank Goes Full Bear Stearns: CEO Blames "Short Sellers" For Firm's Demise

You know it's bad when... you start blaming speculators. Very reminiscent of the "it's not us, we have a solid balance sheet, it's the short selling speculators" bullshit in the days before and after the stock crashes of American Insurance Group, Bear Stearns, Lehman Brothers and Merrill Lynch; mere days after his bank's bonds crashed, the CEO of Raiffeissen Bank (Austria's 3rd largest) has stated (unequivocally) that "panic was created artificially," blaming short-sellers for his bank's demise.

Eurogroup-Greece "Deal Or No Deal" Press Conference Begins - Live Feed

EU President Jeroen Dijsselbloem is about to explain how there is an agreement in principle (if Greece folds, follows the program it's been given and behaves itself - which they have since confirmed they won't) and that discussions are ongoing (haven't changed on bit all day)...

Obama May Attack ISIS In Any Country He Chooses, Deploy Ground Troops On A Whim, Delay Afghanistan Pull Out

The Nobel peace prize-winning president has been busy today: not only did he already petition Congress earlier to declare war on the Islamic State, a non-country which technically doesn't exist, but now he plans to expands his "war powers" to any other place in the world. From Reuters:

  • MILITARY AUTHORIZATION BILL WOULD PRESERVE PRESIDENT'S ABILITY TO ORDER OPERATIONS AGAINST ISLAMIC STATE IN COUNTRIES OTHER THAN IRAQ, SYRIA - WHITE HOUSE SPOKESMAN
  • WHITE HOUSE SAYS COMBAT BOOTS ON THE GROUND MAY BE USED FOR HOSTAGE RESCUE OPERATIONS
  • OBAMA NOT RULING OUT DEPLOYING COMBAT TROOPS ON GROUND TO ASSIST AIR STRIKES AGAINST ISLAMIC STATE, IF PENTAGON RECOMMENDS IT -WHITE HOUSE

And not only that: also according to Reuters, Obama is considering a request from Afghan President Ashraf Ghani to slow the pace of the withdrawal of U.S. troops in Afghanistan, a senior administration official said on Wednesday.

Deserted US Embassy In Yemen Immediately Seized By Armed Rebels

Moments after its US inhabitants leave the embassy in Yemen for one final time, it is now officially owned by the new, less than supported by the US, rebel regime.

  • ARMED HOUTHI REBELS SEIZE U.S. EMBASSY VEHICLES AFTER AMBASSADOR, DIPLOMATS LEAVE COUNTRY - LOCAL MEMBERS OF EMBASSY STAFF

We could make a token witty comment about how this entire episode is emblematic and symbolic of all US foreign policy in recent history, but at this point, what difference does it make?

Full Circle: Obama Asks Congress For Troop Deployment In Iraq, War Authorization On Islamic State

Update: OBAMA ASKS CONGRESS TO AUTHORIZE WAR AGAINST ISLAMIC STATE: AP

Several years ago, Obama impressed a handful of crusty, old people in Norway who believed the recent Illinois senator's vision of a world without war, validated by his eagerness to end the war in Iraq and withdraw US troops to their native country. He got an award for it. Today, Obama will finally complete the circle started in August when, under the premise of "humanitarian intervention", allegedly meant to save a group refugees stranded on a mountain, Obama launched an airborne coalition effort to destroy the same group of radical jihadist extremists that the US was assisting when they were merely fighting the Assad regime in Syria. Because today is when Obama will officially request that those same troops that he so liberally pulled out in compliance with his Nobel Peace Prize, be put back in Iraq in order to declare war on, drumroll, a nation that doesn't technically even exist: the Islamic State.

Frontrunning: February 11

  • Methodology change sees Indian economy grow faster than China's (Reuters)
  • Can Greek Businesses Even Survive? (WSJ)
  • Putin to travel to Minsk talks raising hopes of a deal over Ukraine (Euronews)
  • Ukraine contact group representatives deny ceasefire deal in Minsk (Reuters)
  • Moar buybacks! Hedge Fund-Backed Investor Puts Himself Up for G.M. Board (NYT)
  • Ukraine peace summit overshadowed by some of war's worst fighting (Reuters)
  • Time for non-non-GAAP excluding China: Tesla CEO threatens firings after dismal China sales - sources (Reuters)
  • Jon Stewart leaving Comedy Central's 'The Daily Show' (Reuters)