http://www.zerohedge.com/fullrss2.xml en Janet Yellen's J-Hole Speech: Slack Remains, QE Is Over, Rates Could Rise Sooner (Or Later) http://www.zerohedge.com/news/2014-08-22/janet-yellens-j-hole-speech-slack-remains-qe-over-rates-could-rise-sooner-or-later <p>Simply put, as Citi noted, <strong><a href="http://www.zerohedge.com/news/2014-08-20/jackson-hole-tremendous-downside-risks-if-yellen-doesnt-go-full-dovish">unless Fed head Janet Yellen goes full-dovish, risk assets face tremendous downside potential</a></strong>.&nbsp; As ConvergEx&#39;s Nick Colas notes, Yellen receives a &quot;B&quot; grade from financial professionals, <strong><u>fewer than half (49%) of those surveyed approve of the job the Federal Reserve is doing</u></strong>. A clear majority (59%) of respondents describe the Fed as being &quot;behind the curve&quot; with respect to interest rates. Despite better-than-expected data whereever one looks in the US (apart from wages and housing), any hint of seni-dovish, or contingent dovish... or heaven forbid hawkish comments and the massive consensus trade that the Yellen Put has an ever-increasing strike price will fall rapidly by the wayside... though Draghi could come in later and save the day. <em>With S&amp;P so close to 2000, we suspect any hint of word &#39;slack&#39; and algos will run stops and USDJPY will break 104.</em></p> <p><strong>Pre-Yellen: </strong>S&amp;P Futs 1986, 10Y 2.407%, JPY 103.77, Gold $1278, Oil $93.35</p> <ul> <li><strong>*YELLEN: LABOR MARKET HASN&#39;T FULLY RECOVERED EVEN AMID JOB GAINS</strong></li> <li><strong>*YELLEN SAYS THERE&#39;S `NO SIMPLE RECIPE&#39; FOR APPROPRIATE POLICY</strong></li> <li><strong>*YELLEN: FOMC SHIFTING TO QUESTIONS ON LEVEL OF JOB-MARKET SLACK</strong></li> <li><strong>*YELLEN SAYS GAUGING LABOR-MKT SLACK NEEDS TO BE `MORE NUANCED&#39;</strong></li> <li><strong>*YELLEN REITERATES ASSET BUYING TO BE COMPLETED IN OCTOBER</strong></li> <li><strong>*YELLEN SAYS ASSESSMENT OF SLACK DEPENDS ON RANGE OF VARIABLES</strong></li> <li><strong>*YELLEN SAYS FASTER PROGRESS ON GOALS MAY BRING RATE RISE SOONER</strong></li> <li><strong>*YELLEN SAYS SLOWER PROGRESS ON GOALS MAY DELAY RATE INCREASE</strong></li> <li><strong>*YELLEN COMMENTS AT FED CONFERENCE IN JACKSON HOLE, WYOMING</strong></li> <li><strong>*YELLEN SAYS FOMC SEES SIGNIFICANT UNDER-USE OF LABOR RESOURCES</strong></li> </ul> <p>&nbsp;</p> <p>We are unsure if there is a live feed (due to start at 10amET) - <em>click image for link to live Feed from Bloomberg if there is one.</em></p> <p><a href="http://www.bloomberg.com/tv/livestream/" target="_blank"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2014/08/20140822_yellen.jpg" style="width: 525px; height: 335px;" /></a></p> <p>&nbsp;</p> <p>The full Yellen wordcloud:</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/Yellen%20Word%20Cloud.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/Yellen%20Word%20Cloud_0.jpg" style="width: 600px; height: 378px;" /></a></p> <p>Full Statement (<a href="http://federalreserve.gov/newsevents/speech/yellen20140822a.htm">link</a>):</p> <p><iframe class="scribd_iframe_embed" data-aspect-ratio="0.7729220222793488" data-auto-height="false" frameborder="0" height="600" id="doc_63446" scrolling="no" src="//www.scribd.com/embeds/237503254/content?start_page=1&amp;view_mode=scroll&amp;access_key=key-JoKKOY6rFgS2fNnMti8M&amp;show_recommendations=false" width="100%"></iframe></p> <p>&nbsp;</p> <p>&nbsp;</p> <p>*&nbsp; *&nbsp; *</p> <p>BACKGROUND...</p> <p>As Deutsche&#39;s Jim Reid notes,</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>Chair to provide us with an updated assessment on the infamous &lsquo;Yellen dashboard&rsquo; in evaluating the ongoing labour market slack and how they have yet to normalise relative to 2002-2007 levels.</strong> Some of these alternative measures she monitors include duration of unemployment, quit rate in JOLTS data, labour force participation etc. Any sound bite that touches on the debate of cyclical versus structural drivers of labour force participation will also be closely followed. Unlike some of the previous Jackson Hole symposiums, this is likely not one that will serve as a precursor of any monetary policy changes but the tone of Yellen&#39;s speech may still have a market impact and set the mood for busier times ahead in September. <u><strong>Given markets are seemingly expecting nothing but another dovish display from Yellen the risk is perhaps skewed to the other side.</strong></u></p> </blockquote> <p>And ConvergEx shows even the pros are in doubt...</p> <ul> <li>ConvergEx Group Survey Finds <strong>Less Than Half of Respondents Approve of Job the Fed is Doing</strong></li> <li><strong>Two-Thirds of Respondents Say Central Bank Has Too Much Influence On Markets</strong></li> <li>Financial Professionals Name<strong> Paul Volcker As Best Federal Reserve Chairman Of All Time</strong></li> </ul> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;The financial industry likes Janet Yellen but believes she leads a central bank that is overexposed and behind the curve,&quot; said Nicholas Colas, ConvergEx Group chief market strategist. &quot;There&#39;s tangible fear among investment professionals about the unwinding of Quantitative Easing and the painful increases in rates that will follow. Our survey shows that Ms. Yellen is seen as a strong leader, and investors don&#39;t want to scrap the structure of the Fed, but there is real concern about what happens next.&quot;</p> </blockquote> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/news/2014-08-20/jackson-hole-tremendous-downside-risks-if-yellen-doesnt-go-full-dovish">As we noted previously, expectations are extremely high...</a></p> <p><strong>&lsquo;Full dovish&rsquo; means moving the goal posts on the targets.</strong> Keeping the current targets, even accompanied by rhetoric and optimism, is hawkish because it suggests that normalization is coming as well get closer to the targets.<br /><strong>&nbsp;<br />There are three ways by which Yellen can express dovishness, but only one that breaks new ground:</strong><br />&nbsp;<br /><strong>i) Full dovish</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>1) Argue that the natural rate is less than 5 &frac14; -&nbsp; 5 &frac12; %</p> <p>&nbsp;</p> <p>2) Advocate for a temporary overshoot of the inflation target</p> <p>&nbsp;</p> <p>3) Emphasize the uncertainty around NAIRU estimates that tightening can wait till there is real evidence of accelerating inflation.</p> <p>&nbsp;</p> <p>4) Introduce a soft wage target of about 3.5%, consistent with&nbsp; aspirational 1.5% productivity growth and 2% unit labor cost growth</p> </blockquote> <p><strong>ii) Semi dovish</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>1) Make the case that there is no sustained inflation likely without accelerating wage growth and there is little broad evidence for such a pickup, but keep existing inflation and unemployment targets</p> <p>&nbsp;</p> <p>2) Introduce a new labor market indicator that captures the slack she feels that the unemployment rate misses, but again keep to existing targets</p> </blockquote> <p><strong>iii) Contingent dovish</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>1) Forecasting a pickup in productivity and labor force participation that will limit the need for tightening</p> </blockquote> <p><strong>Full dovish goes beyond anything she has stated explicitly in her comments.</strong> It would give stimulus more room on unemployment, inflation or both, and&nbsp; lead to yields dropping even further, taking the USD with them. There are straightforward arguments to justify full dovish, but the Chair has not advocated any of them so far, so it would clearly plant her among the most committed doves.<br />&nbsp;<br /><strong>Semi dovish may generate a strong initial market reaction if it looks as if it is introducing new factors into the policy equation but is much more ambiguous.</strong> &#39;Low wages imply low inflation&#39; is a property of most inflation models but much weaker than&nbsp; saying that wage growth is now a target.&nbsp; Were inflation to pick up for others reasons the Fed would still tighten, even if wages remained soft. Similarly it&nbsp; is unclear what it means to say that the unemployment rate understates slack, but 5 &frac14; - 5 &frac12;% is the target anyway. While we would focus on whether the goalposts are being shifted, semi dovish can sound very dovish until it becomes clear whether there is any functional shift in the FOMC&rsquo;s goals.<br />&nbsp;<br /><strong>Contingent dovish is the argument she has put forward for a long time. </strong>It sounds more dovish than it is because no one has a real handle on the drivers of trend productivity growth and the US supply side has disappointed badly.&nbsp; Both the participation rate and productivity growth are at weak levels and there is no compelling case that either will pick up.&nbsp; The safest assumption is that trend productivity growth over the next three years is what it was the last three years, and that participation rates are unlikely to surge.</p> <p>*&nbsp; *&nbsp; *</p> <p><strong><u>Were she simply to say that the targets are the targets and they will begin to reduce stimulus as they are approached, it would be a tremendous let down and viewed as very hawkish versus expectations.</u></strong></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="832" height="524" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/Yellen%20Word%20Cloud.jpg?1408716815" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/janet-yellens-j-hole-speech-slack-remains-qe-over-rates-could-rise-sooner-or-later#comments B+ ETC Federal Reserve Janet Yellen Jim Reid Monetary Policy Paul Volcker Quantitative Easing Unemployment Fri, 22 Aug 2014 14:04:04 +0000 Tyler Durden 493346 at http://www.zerohedge.com Ukraine Issues Statement On "Illegal" Entry By Russian Convoy, Warns Of "Planned Provocation" http://www.zerohedge.com/news/2014-08-22/ukraine-issues-statement-illegal-entry-russian-convoy-warns-planned-provocation <p>Because the comedy never ends. Btw, how is that "evidence" of a destroyed Russian convoy coming along... or the MH-17 ATC tapes? Any minute now?</p> <p><em>From the <a href="http://mfa.gov.ua/en/press-center/comments/2211-zajava-mzs-ukrajini-u-zvjazku-z-nezakonnim-peretinom-konvojem-rosijsykoji-federaciji-derzhavnogo-kordonu-ukrajini">Ukraine Ministry of Foreign Affairs:</a></em><a href="http://mfa.gov.ua/en/press-center/comments/2211-zajava-mzs-ukrajini-u-zvjazku-z-nezakonnim-peretinom-konvojem-rosijsykoji-federaciji-derzhavnogo-kordonu-ukrajini"></a></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Statement of the MFA of Ukraine in connection with illegal crossing of the state border of Ukraine by the Russian convoy</strong></p> <p>&nbsp;</p> <p>On August, 22 Russia began smuggling humanitarian aid to Ukraine, ignoring established international rules, procedures and agreements, without the consent and escort of the International Committee of the Red Cross.</p> <p>&nbsp;</p> <p>Although the border and customs services of Ukraine have already started clearance of the Russian convoy, in the morning Ukrainian officials were blocked by the Russian forces and detached from the inspection of the rest of the trucks in the column, despite previous agreements and the fact that they had been invited to the territory of Russia. We are concerned about the safety of our employees. Moreover, deep concern is raised because so far neither Ukrainian side nor the ICRC are aware of the content of the cargo.</p> <p>&nbsp;</p> <p><strong>The fact that Russian trucks entered the territory of Ukraine without proper border and customs procedures and that the cargo was not donated to the representatives of the International Committee of the Red Cross indicates deliberate and aggressive nature of Russia’s actions.</strong></p> <p>&nbsp;</p> <p>As we have previously emphasized <strong>the Russian side is fully responsible for the safety of the cargo</strong>. It is important to note that <strong><span style="text-decoration: underline;">the Ukraine</span> has already taken all necessary measures to ensure the security of the cargo.</strong></p> <p>&nbsp;</p> <p>In order to prevent any provocations we have issued all necessary instructions for the safe passing of the convoy. Despite all attempts by the Ukrainian side the contact between the General Staff of the Armed Forces of Ukraine and the one of Russia, has not been established, which is critical to ensure security along the route. <strong>We point out that terrorists carry out mortar attacks along the possible route of the cargo.</strong></p> <p>&nbsp;</p> <p><strong>We also are not aware of the content of the agreements of the Russian side with Luhansk insurgents and we do not exclude the possibility of any planned provocation.</strong></p> <p>&nbsp;</p> <p><strong>We consider this act to be another flagrant violation of the fundamental principles of international law</strong>, including inviolability of borders, non-interference in the internal affairs of another state and bona fide fulfillment of international obligations by the Russian Federation.</p> <p>&nbsp;</p> <p>We call on all international partners to join the strong condemnation of illegal and aggressive acts of the Russian Federation.</p> </blockquote> <p>So it's "the Ukraine" after all? And some headlines from Yatseniuk:</p> <ul> <li><strong>YATSENYUK SAYS CONVOY IS FARCE, NOT HUMANITARIAN AID</strong></li> <li><strong>YATSENYUK: UKRAINE SEEKS 4-PARTY TALKS W/ RUSSIA, U.S., EU</strong></li> <li><strong>YATSENYUK SAYS RUSSIA VIOLATED INTERNATIONAL LAW</strong></li> </ul> <p>And the punchline:</p> <ul> <li><strong>YATSENYUK SAYS PUTIN PERSONALLY RESPONSIBLE FOR CONVOY SAFETY</strong></li> </ul> <p>So, attack imminent which will then be blamed on Russia as a false flag attemp provocation. Got it.</p> http://www.zerohedge.com/news/2014-08-22/ukraine-issues-statement-illegal-entry-russian-convoy-warns-planned-provocation#comments headlines Ukraine Fri, 22 Aug 2014 13:49:39 +0000 Tyler Durden 493345 at http://www.zerohedge.com JPM's Three Scenarios Of How The Ukraine Conflict Plays Out http://www.zerohedge.com/news/2014-08-22/jpms-three-scenarios-how-ukraine-conflict-plays-out <p>With USDJPY algos, and thus the S&amp;P, reacting as if stung like bees by every fabricated headline emerging out of Ukraine (only to reverse the move promptly after once the market realizes the biggest war in Ukraine continues to be one of disinformation), there appears to be far more confusion about how the Ukraine conflict will play out than what the Fed will do (recall that <em><strong>every</strong></em>one is certain today Yellen will release even more dovishness). So to help out with the confusion here are three scenarios and trades from JPM, on how the Ukraine conflict may play out, if only in capital markets.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The market continues to be headline driven, with frequent surprises, since the onset of the Ukrainian crisis in March, yet the signs of de-escalation are emerging more frequently. We try to address the “what’s next and what to do” among investors’ FAQs. The effect of the crisis and sanctions becomes clearer through performance comparisons for Russia vs. EMs with more granularities provided through the industrial sector indices’ comps. Not surprisingly, the biggest damage can be seen in Energy and Financials, as both have some major names already sanctioned. These remain in a risk zone, yet it’s fair to assume that the de-escalation would warrant a symmetrical recovery trade. We assess the potential scenarios and strategies here.</p> <p>&nbsp;</p> <p><strong>Conceptually, the nature of the negative effects should be two-fold</strong>: (A) A higher risk premium related to deterioration of earnings visibility and investability of shares; and (B) the macro impact on earnings expectations through top line and FX hits. Both are visible in the general and sector index performance comparison in the table below.</p> <p>&nbsp;</p> <p><strong>Scenarios and trades. The gap analysis suggests the following scenarios and trades:</strong></p> <ol> <li>the positive “de-escalation” scenario triggering gradual sanctions removal, and moderate acceleration of the macro environment could see the repetition of the April-July rally (~15% upside) with the most pronounced catch-up in Financials;</li> <li>the “status quo” scenario – Russia distances itself from Ukrainian events yet the conflict drags on and fades into the cold season with no further sanctions, triggering reduction of risk premiums benefiting the three laggard sectors (EN, FN, TC);</li> <li>the negative “escalation” scenario: the impact would match the extent of the additional sanctions’ scope and depth; at the extreme, investability of&nbsp; the market could be severely impaired.</li> </ol> <p><strong>In focus: </strong>the next big catalyst is a high level Russia/Ukraine/EU meeting in Minsk on August 26</p> <p>&nbsp;</p> <p><strong>Stock-specific performance is illustrative</strong>. The July-to-August trough and the recovery from the August low is shown in the chart below. We show the names with the most negative performance combo, featuring many of the sanctioned names.</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/JPM%20ukraine.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/JPM%20ukraine_0.jpg" width="600" height="361" /></a></p> </blockquote> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1312" height="790" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/JPM%20ukraine.jpg?1408714450" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/jpms-three-scenarios-how-ukraine-conflict-plays-out#comments B+ Capital Markets recovery Risk Premium Ukraine Fri, 22 Aug 2014 13:34:58 +0000 Tyler Durden 493344 at http://www.zerohedge.com Roundup Of Key Research Papers At Jackson Hole http://www.zerohedge.com/news/2014-08-22/roundup-key-research-papers-jackson-hole <p>With all eyes and ears firmly focused Janet Yellen's opening oratory this morning (due at 10ET), the contents of the rest of the conference appear to have been forgotten (and yet in the past have been among the most crucial to comprehend central banks' actions after the fact - forward guidance and QE for 2). <a href="http://www.businessweek.com/news/2014-08-21/who-s-who-on-guest-list-of-fed-symposium-jackson-hole-journal">As Bloomberg BusinessWeek reports</a>, <strong>robots <span style="text-decoration: underline;">don’t</span> steal jobs</strong>, the U.S. <strong>labor market is <span style="text-decoration: underline;">less</span> flexible than it was</strong>, and <strong>workers <span style="text-decoration: underline;">haven’t</span> suffered unprecedented periods out of work</strong> (and rehiring odds are the same as always), are among the conclusions of key papers being presented at the symposium, along with (unsurprisingly) findings that <strong>policymakers would benefit from a better understanding of labor market dynamics</strong>. The following is a brief review of their contents...</p> <p><strong>Robots and computers don’t steal as many jobs as some believe, and automation actually benefits many workers</strong>, <a href="http://www.kansascityfed.org/publicat/sympos/2014/093014.pdf">Massachusetts Institute of Technology Professor David Autor said in his paper</a>.</p> <blockquote><p>A key reason humans aren’t obsolete yet is that simple tasks such as visually identifying a chair, which any child can do, aren’t so easy for engineers to teach to computers, Autor said.</p> <p>&nbsp;</p> <p>“<span style="text-decoration: underline;"><strong>Journalists and expert commentators overstate the extent of machine substitution for human labor and ignore the strong complementarities that increase productivity, raise earnings, and augment demand for skilled labor,</strong></span>” he wrote. “Challenges to substituting machines for workers in tasks requiring flexibility, judgment, and common sense remain immense.”</p> </blockquote> <p><strong>The U.S. labor market became less fluid in recent decades partly because of an aging workforce, a shift to older businesses, and the spread of occupational licensing and certification,</strong><a href="http://www.kansascityfed.org/publicat/sympos/2014/083014-1.pdf"> economists Steven J. Davis</a> and <a href="http://www.kansascityfed.org/publicat/sympos/2014/083014-1.pdf">John Haltiwanger wrote in their paper.</a></p> <blockquote><p>The economists define labor market fluidity as “flows of jobs and workers across employers.” The paper found the U.S. “underwent a large, broad-based decline in the pace of labor market flows in recent decades.”</p> <p><span style="text-decoration: underline;"><strong>“An aging workforce is a factor behind the slowdown of worker reallocation,”</strong></span> the paper said.</p> <p>Other factors they found included the “information revolution in hiring practices”; minimum wage laws; and “job lock” associated with employer-related health insurance.</p> </blockquote> <p><strong>US workers in the aftermath of the 2007-2009 recession haven’t experienced unprecedentedly long bouts of non-employment</strong>, according to a <a href="http://www.kansascityfed.org/publicat/sympos/2014/080014.pdf">paper by economists Jae Song and Till von Wachter.</a></p> <blockquote><p>Their findings “suggest that<span style="text-decoration: underline;"><strong> the potential for hysteresis in the aftermath of the Great Recession is moderate</strong></span>,” the paper said.</p> <p>&nbsp;</p> <p>Hysteresis posits that people out of work for too long have a harder time finding work, leading to a persistent decline in the employment-to-population rate.</p> <p>&nbsp;</p> <p>In contrast to long-term unemployment, the extent of long-term non-employment <span style="text-decoration: underline;"><strong>“was comparable to that in previous recessions,”</strong></span> the paper says, finding that non-employment spells lasting more than two years “exhibited moderate cyclical movements” also similar across downturns.</p> </blockquote> <p><strong>Policy makers would benefit from a better understanding of labor markets</strong>, <a href="http://www.kansascityfed.org/publicat/sympos/2014/090014.pdf">economist Giuseppe Bertola argued in a paper</a> that weighed the impact of rules making those markets rigid or flexible.</p> <blockquote><p><span style="text-decoration: underline;"><strong>Rules that protect workers from job losses and provide more generous unemployment benefits can soften and smooth shocks to the economy</strong></span>, said Bertola.</p> <p>&nbsp;</p> <p>More rigid policies have a greater appeal to policy makers “after a crisis that casts doubt on the efficacy of financial markets and shows that monetary and other macro policies cannot always prevent deep recessions”</p> <p><span style="text-decoration: underline;"><strong>Rules that make it easier for companies to fire workers can speed up how an economy adjusts after a crisis</strong></span> and are particularly useful when “sector reallocation” is needed “but it would be wishful to suppose that it can quickly and painlessly restore equilibrium”</p> <p>Pros and cons of market rigidities depend on circumstances, and labor policies should adapt to specific conditions</p> <p>“Policy makers should be ready to react appropriately to cyclical and structural developments in labor as well as monetary, financial and goods markets”</p> <p>“Labor market rigidities may yet become fashionable in the aftermath of a crisis where they were useful”</p> </blockquote> <p>&nbsp; *&nbsp; *</p> <p>So, there you have it - in full Obi Wan Kenobi 'this is not the reality you are looking for' style - the smartest people in the room want you to believe that robotification does not mean minimum wage hikes are impossible (<a href="http://www.zerohedge.com/news/2014-08-07/minimum-wage-hikers-worst-enemy-spotted-china">just don't tell McDonalds</a>) and that workers really haven't suffered that much (compared to ther recessions) -<strong> <a href="http://www.zerohedge.com/news/2014-08-19/worst-recovery-ever">despite this being the worst recovery ever.</a></strong></p> <p>Finally, for those looking for today's full agenda, <a href="http://www.kc.frb.org/publications/research/escp/escp-2014.cfm">here it is</a>:<strong>&nbsp;</strong></p> <p><strong><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/JHole%20agenda.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/JHole%20agenda_0.jpg" width="600" height="1228" /></a><br /></strong></p> <p><a href="http://www.businessweek.com/news/2014-08-21/who-s-who-on-guest-list-of-fed-symposium-jackson-hole-journal"><em>Source: Bloomberg and Bloomberg BusinessWeek</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="459" height="312" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20140822_johole.jpg?1408712323" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/roundup-key-research-papers-jackson-hole#comments McDonalds Reality Recession recovery Unemployment Unemployment Benefits Fri, 22 Aug 2014 13:12:13 +0000 Tyler Durden 493343 at http://www.zerohedge.com Russian Humanitarian Convoy Enters Ukraine Without Authorization; Ukraine Considers Move "Direct Invasion" http://www.zerohedge.com/news/2014-08-22/russian-humanitarian-convoy-enters-ukraine-without-authorization-ukraine-considers-m <p><em><strong>Update 3: </strong></em>Ukraine's president speaks:</p> <ul> <li><strong>UKRAINE CONCERNED OVER RUSSIAN AID CONVOY INTRUSION: POROSHENKO</strong></li> <li><strong>UKRAINE SEEKS TO AVOID ‘HEAVIER CONSEQUENCES’: POROSHENKO</strong></li> </ul> <p>And yet the locals seem happy:</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/convoy%20locals.jpg" width="600" height="363" /></p> <p><em><strong>Update 2</strong></em>: All trucks are now in Ukraine:</p> <blockquote class="twitter-tweet"><p>All the trucks have crossed the border and are now in Ukraine. We are back in Russia.</p> <p>— Andrew Roth (@ARothNYT) <a href="https://twitter.com/ARothNYT/statuses/502792901534158848">August 22, 2014</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p><em><strong>Update</strong></em>: the farce is complete, although at least this time it didn't take Ukraine several hours to fabricate then unfabricate its plot line, <em>because literally minutes after it accused Russia of invading, <strong>Ukraine's foreign minister said the convoy was "allowed" to avoid provocations. </strong></em>He added that the rebel militants are using mortars on the convoy route and that it had taken all necessary steps to ensure cargo safety but that Russia wouldn't discuss security for the convoy.&nbsp; Nonetheless it still accused Russia's convoy of breaking international law and said that convoy would go to separatists, not civilians, and called on its "international partners" (we suppose it means the CIA here, which apparently is feeding it this ridiculous script) to condemn the Russian convoy. </p> <p>From Bloomberg:</p> <ul> <li>UKRAINE SAYS ALLOWED RUSSIAN CONVOY IN TO AVOID PROVOCATIONS</li> <li>NALYVAYCHENKO SAYS WILL GO TO SEPARATISTS, NOT CIVILIANS: IFX</li> <li>UKRAINE SAYS RUSSIA WOULDN’T DISCUSS SECURITY FOR CONVOY</li> <li>UKRAINE SAYS IT TOOK ALL NECESSARY STEPS TO ENSURE CARGO SAFETY</li> <li>UKRAINE SAYS RUSSIAN CONVOY IS BREAKING INTERNATIONAL LAW</li> <li>UKRAINE HAS CONCERNS OVER CONTENTS OF UNCHECKED RUSSIAN TRUCKS</li> </ul> <p>Finally:</p> <ul> <li>UKRAINE WILL NOT USE ANY FORCE AGAINST RUSSIAN AID CONVOY, WISHES TO AVOID "PROVOCATIONS" - UKRAINIAN STATE SECURITY CHIEF NALIVAYCHENKO</li> </ul> <p>Translation: it will accuse "rebels" of a direct attack on the Russian convoy when it happens, blaming Russia for trying to stage an attack so Russia has a provocation pretext to really invade, as opposed to the fake "invasion" Ukraine accused Russia of just moments ago.</p> <p>In other words, the "MH17 scenario" is now in play, with the question not so much if and who "provokes" the Russian convoy in the coming days, but how Russia will react to it. It appears that contrary to expectations, today will be another trading session in which the main catalyst will be not Jackson Hole but Ukraine once again, as algos react, in an already illiquid market, with extended momentum to each and every contradictory headline.</p> <p>Finally, with a scenario evolving in such a farcical and chaotic fashion, one wonders if John Kerry somehow managed to sail his sailboat into Kiev and is currently giving the Ukraine government the play by play.</p> <p>&nbsp;</p> <hr /> <p>Here we go again. Precisely a week after the fabricated headlines last Friday that Ukraine had blown up Russian military vehicles in Ukraine territory, "news" which promptly was forgotten when Russia denied and Ukraine couldn't produce any proof of said attack, now it is time for the real "humanitarian" convoy to become the topic du jour, and so it did a few hours ago when some 90 trucks from the convoy were said to have entered Ukraine territory, a move which Ukraine promptly denounced as a direct invasion. </p> <p>A clip of the Russian trucks entering Ukraine via AP:</p> <p><iframe src="//www.youtube.com/embed/7QIq-BWY5KI" width="600" height="338" frameborder="0"></iframe></p> <p>The reason for the convoy movement came overnight <a href="http://www.mid.ru/bdomp/brp_4.nsf/sps/9BACEA6220212D7544257D3C0029BDF9">when the Russian Foreign Ministry </a>said Ukraine seems to be seeking military victory by country’s independence day, "deliberately" delaying delivery of humanitarian aid.&nbsp; Russia added that is sees no reason to delay further, and the aid convoy starts moving toward Luhansk.&nbsp; "We warn against any attempts to halt solely humanitarian mission" that was prepared transparently with cooperation from Ukraine, Red Cross, ministry says. </p> <p>RT adds that Russia said it had met all imaginable and unimaginable demands, including handing exhaustive lists of cargo details to the Red Cross, and that Kiev was inventing new pretexts each day for delaying humanitarian convoy, while the Red Cross reportedly said it was frustrated with Kiev in letting the convoy into Ukraine. That said, because it could not obtain security assurances, the Red Cross would not accompany the Russian convoy.</p> <p>It is this perhaps why moments ago, Interfax (the Ukraine version that is) blasted the following headline via Bloomberg:</p> <ul> <li><strong>UKRAINE SEES RUSSIAN AID CONVOY AS INVASION: INTERFAX</strong></li> </ul> <p>With the head of security council Nalyvaychenko cited as the source. Additionally Ukraine speaker Lysenko added that Russia aid convoy ignored agreement on cargo processing. </p> <p>This promptly resulted in a drop in S&amp;P 500 futures fall 0.3% to 1983.40, Stoxx Europe 600 falls 0.6% to session low after the Interfax report that Ukraine sees Russian aid convoy as invasion. </p> <p>Expect much more disinformation out of Ukraine over the next few. hours as last Friday plays out once again.</p> <p><em>Here is Reuters with the <a href="http://www.reuters.com/article/2014/08/22/us-ukraine-crisis-aid-convoy-idUSKBN0GM0IS20140822">full report</a>:</em></p> <p>&nbsp;Ukraine declared on Friday that Russia had launched a "direct invasion" of its territory after Moscow sent a convoy of aid trucks across the border into eastern Ukraine where pro-Russian rebels are fighting government forces.</p> <p>Moscow, which has thousands of troops close on the Russian side of the border, warned against any attempt to "disrupt" the convoy but did not specify what action it was prepared to take if Kiev's forces intervened.</p> <p>Kiev, for its part, said Ukrainian forces would not attack the convoy and had allowed it to pass to avoid "provocations".</p> <p>"Ukraine will liaise with the International Committee of the Red Cross so that we, Ukraine, are not involved in provocations (accusations) that we have been holding up or using force against the vehicles of so-called aid," he told journalists.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="600" height="363" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/convoy%20locals.jpg?1408711020" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/russian-humanitarian-convoy-enters-ukraine-without-authorization-ukraine-considers-m#comments headlines Reuters Ukraine Fri, 22 Aug 2014 13:02:45 +0000 Tyler Durden 493338 at http://www.zerohedge.com Dour Comments By China's Leading Supply Chain Manager Reinforce Citi's View For €1 Trillion ECB QE http://www.zerohedge.com/news/2014-08-22/dour-comments-chinas-leading-supply-chain-manager-reinforce-citis-view-%E2%82%AC1-trillion-e <p>While the US Q2 earnings season is now largely in the history books, an interesting place to get some additional commentary on the world economy is none other than China's leading global sourcing/supply-chain management firm Li &amp; Fung, which "supplies high-volume, time-sensitive consumer goods from an extensive global network of suppliers and distributors", which had some interesting comments on the current state of global economic developments. </p> <p>Here is the summary of their latest results commentary from Deutsche Bank:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Li &amp; Fung’s latest results yesterday offered some interesting anecdotes. The company’s performance for the first 6 months was hampered by ongoing macroeconomic weakness, geopolitical and weather events in its key destination markets (US and Europe). Price discounting remains a theme in US retail even beyond the end of June. The company also noted a reduction of foreign tourist flow by Russian tourists into Europe which is affecting retail markets there. This fits consistently well with some of the ECB’s geopolitical concerns outlined at its previous policy meeting.</p> </blockquote> <p>In short, hardly the stuff "escape velocity" global recoveries are made of. The good news: considering the ongoing weakness in both the European and Chinese economy, this surely means, at least according to Wall Street penguins, that more easing is due any minute out of both the ECB and China. And sure enough, moments ago Citi'sGuillame Menuet saaid that the ECB will likely launch a €1 trillion QE some time in Q4. </p> <p>From the note: "<em>ECB QE: Why, When and How</em>"</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Reinforcing our QE view </strong>— The euro area recovery is struggling, as evidenced by Q2 GDP reports and Q3 surveys. Downside risks to economic activity, a still-strong euro, large output gap and persistent undershooting of its inflation target, all point even more strongly to the ECB announcing a large QE programme soon.</p> <p>&nbsp;</p> <p><strong>December more likely to September </strong>— We do not expect QE to be announced at the September meeting, mainly because of expectations that the June policy decisions will ease funding conditions further, uncertainty pertaining to the AQR and ECB stress tests, and the ECB’s hope of strong bids at the Sep and Dec TLTROs. However, we believe that the consensus underestimates the likelihood of QE in late Q4-14 or early Q1-15, and the ECB’s willingness to defend its inflation target.</p> <p>&nbsp;</p> <p><strong>€1tn asset purchase </strong>programme — Increasing signs that medium-to-long term inflation expectations are drifting lower and the need to defend its mandate and credibility will lead to aggressive action, in our view. We expect a 60/40 split between public and private sector assets, with the latter focused mainly on bank bonds and loans.</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/Eurozone%20eligible%20assets.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/08/Eurozone%20eligible%20assets_0.jpg" width="600" height="347" /></a></p> </blockquote> <p>In other news, the only thing better than good news for stocks continues to be, what else, bad news.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="912" height="527" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/Eurozone%20eligible%20assets.jpg?1408711920" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/dour-comments-chinas-leading-supply-chain-manager-reinforce-citis-view-%E2%82%AC1-trillion-e#comments China Deutsche Bank None Output Gap recovery Fri, 22 Aug 2014 12:52:21 +0000 Tyler Durden 493342 at http://www.zerohedge.com Russia Busts European Sanctioned-Fruit Smuggling Ring http://www.zerohedge.com/news/2014-08-22/russia-busts-european-sanctioned-fruit-smuggling-ring <p>Just days after Russia banned the import of various foods from sanctions-supporting nations, <a href="http://vz.ru/news/2014/8/18/700939.html">VZ reports</a><strong> Russia's food safety ministry Rosselhoznadzor has discovered fruit being smuggled in via Belarus that was restamped as being from Zimbabwe</strong> and various other non-sanctioned nations. It appears the smuggling nation <span style="text-decoration: underline;"><strong>culprits are Poland, Slovenia, and Greece</strong></span> and Russia is now "actively monitoring the situation," suggesting they may extend import bans to Belarus also if the situation continues. In addition, Rosselhoznadzor intends in the future to move to a system of electronic certification of goods in transit.</p> <p>&nbsp;</p> <p><a href="http://vz.ru/news/2014/8/18/700939.html"><em>As VZ reports (via Google Translate)</em></a>,</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Rosselhoznadzor for a few days gave delivery to Russia via Belarus parties apples, peaches, plums, tomatoes without specifying the country of origin or an indication of permitted Turkey, Serbia, Macedonia, and a number of African countries, including Zimbabwe.</strong> However, phytosanitary documents of origin have not been parties or they caused suspicion among Russian inspectors. During the inspection it was found that <strong>fruits and vegetables imported from Poland, Slovenia, the Netherlands, Lithuania and some other EU countries</strong>, he continued. A number of parties had no permits phytosanitary documents Belarus.</p> <p>&nbsp;</p> <p><strong>"Some EU countries have started to send products to Belarus, without specifying the actual country of origin</strong>. and <strong>we found that it is Poland and Greece</strong>, because there is no evidence of Macedonian origin", - he said, reports ITAR-TASS .</p> <p>&nbsp;</p> <p><strong>"We are actively monitoring the situation and will promptly verify the origin of dubious parties to prevent the supply of so-called countries cover",</strong> - he said.</p> <p>&nbsp;</p> <p>In terms of sanctions phytosanitary certification transit of European goods lies on Belarus recalled Dankvert. <strong>"If we have a detection of quarantine objects, we impose restrictions on the supply of Belarus",</strong> - he said.</p> <p>&nbsp;</p> <p><strong>Rosselhoznadzor intends in the future to move to a system of electronic certification of goods in transit</strong>, continued Dankvert. In the meantime, the agency is in contact with the authorized supplier countries, and intends to establish the involvement of buffer states to the issuance of phytosanitary documents for re-export products.</p> <p>&nbsp;</p> <p><strong>In addition, Rosselhoznadzor intends to monitor re-dairy, meat and fish products through Switzerland, Kazakhstan and the Faroe Islands,</strong> continued to head the agency. "In Switzerland, while no cases at the Faroe Islands, too - there are a few companies, it will be immediately obvious, and Kazakhstan already have the facts of transit goods, which are deposited in Moscow ", - stressed Dankvert.</p> </blockquote> <p>*&nbsp; *&nbsp; *<br />And this is happening as Poland and Greece demand recompense from their EU leaders for lost revenues over the sanctions...<br />*&nbsp; *&nbsp; *</p> <p>No big surprise...</p> <blockquote class="twitter-tweet" lang="en"><p>'It's a catastrophe. The cold-storage warehouse is overflowing with fruit that we can't sell' <a href="http://t.co/QkG1JELcPQ">http://t.co/QkG1JELcPQ</a> <a href="http://t.co/yyH0rDrklg">pic.twitter.com/yyH0rDrklg</a></p> <p>— Financial Times (@FT) <a href="https://twitter.com/FT/statuses/500134826956304384">August 15, 2014</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="584" height="515" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20140822_fruit.jpg?1408709696" /> </div> </div> </div> http://www.zerohedge.com/news/2014-08-22/russia-busts-european-sanctioned-fruit-smuggling-ring#comments Google Greece Kazakhstan Lithuania Netherlands Poland Switzerland Turkey Twitter Twitter Fri, 22 Aug 2014 12:15:15 +0000 Tyler Durden 493341 at http://www.zerohedge.com Frontrunning: August 22 http://www.zerohedge.com/news/2014-08-22/frontrunning-august-22 <ul> <li>Ukraine accuses Russia of invasion after aid convoy crosses border (<a href="http://www.reuters.com/article/2014/08/22/us-ukraine-crisis-aid-convoy-idUSKBN0GM0IS20140822">Reuters</a>)</li> <li>Hunt for Foley’s Killer Spans Old Policing and Tech Tools (<a href="http://www.bloomberg.com/news/2014-08-21/social-media-linguistics-scoured-to-find-foley-s-killer.html">BBG</a>)</li> <li>U.S. Probe Examines GM Lawyers (<a href="http://online.wsj.com/articles/u-s-examines-role-of-gm-lawyers-in-probe-of-delayed-recall-1408663774?mod=djemalertNEWS">WSJ</a>)</li> <li>Argentina accuses U.S. Judge Griesa of "imperialist" attitude (<a href="http://www.reuters.com/article/2014/08/22/argentina-debt-idUSE6N0PF02720140822">Reuters</a>)</li> <li>Violence-weary Missouri town sees second night of calm (<a href="http://www.reuters.com/article/2014/08/22/us-usa-missouri-shooting-idUSKBN0GF0LP20140822">Reuters</a>)</li> <li>Geneva Banks Break 200-Year Silence to Unveil Earnings (<a href="http://www.bloomberg.com/news/2014-08-22/geneva-banks-break-200-year-silence-to-unveil-earnings.html">BBG</a>)</li> <li>Richest Jailed Putin Foe Says Ukraine Fears Sparked Prosecution (<a href="http://www.bloomberg.com/news/2014-08-21/richest-jailed-putin-foe-says-ukraine-fears-sparked-prosecution.html">BBG</a>)</li> <li>Disclosure of Failed Attempt to Rescue James Foley Is Criticized (<a href="http://online.wsj.com/articles/disclosure-of-failed-attempt-to-rescue-james-foley-is-criticized-1408670188?tesla=y">WSJ</a>)</li> <li>Execution of U.S. journalist reveals the changing business of war coverage (<a href="http://www.reuters.com/article/2014/08/22/us-media-violence-idUSKBN0GM08X20140822">Reuters</a>)</li> <li>Confronted With Grisly Images, Twitter Is Walking a Fine Line (<a href="http://online.wsj.com/articles/twitter-is-walking-a-fine-line-confronted-with-grisly-images-1408659519?mod=WSJ_hps_sections_business">WSJ</a>)</li> <li>American’s 3-Class Jets Dwindle as First Class Fades Away (<a href="http://www.bloomberg.com/news/2014-08-21/american-s-3-class-jets-dwindle-as-first-class-fades-away.html">BBG</a>)</li> <li>Apple iPhone 6 screen snag leaves supply chain scrambling (<a href="http://www.reuters.com/article/2014/08/22/us-apple-iphone-idUSKBN0GM0N620140822">Reuters</a>)</li> <li>Citigroup Earning Less From Tokyo Than CEO Salary (<a href="http://www.bloomberg.com/news/2014-08-21/citigroup-earning-less-from-tokyo-than-ceo-salary-japan-credit.html">BBG</a>)</li> <li>Oklahoma City policeman arrested for raping women while on patrol (<a href="http://www.reuters.com/article/2014/08/21/us-usa-oklahoma-crime-idUSKBN0GL2DL20140821">Reuters</a>)</li> <li>Accounting scandal just the latest of Penn West's problems (<a href="http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/penn-west-petroleum-plagued-by-many-problems/article20165751/">G&amp;M</a>)</li> </ul> <p>&nbsp;</p> <p><strong>Overnight Media Digest</strong></p> <p><em><span style="text-decoration: underline;">WSJ</span></em></p> <p>* The Obama administration's decision to release secret details of an unsuccessful mission in Syria last month to rescue several Americans held captive by extremists is raising concerns that the disclosure could make it harder for the military to carry out similar operations in the future. (<a href="http://on.wsj.com/1ohyaI6" title="http://on.wsj.com/1ohyaI6">http://on.wsj.com/1ohyaI6</a>)</p> <p>* The beheading of journalist James Foley has prompted American officials to begin working to knit together a broader international campaign to combat the extremists of the Islamic State, an effort that the Pentagon, headquarters of the U.S. Department of Defence, warned that it will require taking the fight beyond Iraq and into neighboring Syria. (<a href="http://on.wsj.com/1qvryY6" title="http://on.wsj.com/1qvryY6">http://on.wsj.com/1qvryY6</a>)</p> <p>* The police response to the unrest in Ferguson, Missouri, has been criticized for a lack of coordination, but experts say the fast-moving situation was difficult to manage. (<a href="http://on.wsj.com/1ohyp65" title="http://on.wsj.com/1ohyp65">http://on.wsj.com/1ohyp65</a>)</p> <p>* U.S. Federal prosecutors are scrutinizing whether employees inside and outside General Motors Co's legal department concealed evidence from regulators about a faulty ignition switch, potentially delaying a recall of vehicles with the fatal problem, according to people familiar with the matter. (<a href="http://on.wsj.com/1msf02C" title="http://on.wsj.com/1msf02C">http://on.wsj.com/1msf02C</a>)</p> <p>* Central bankers gathering for the Jackson Hole conference in Wyoming confront a global economy that has once again disappointed, leaving them reluctant in some places and unable in others to turn off spigots of easy money. (<a href="http://on.wsj.com/1q3xeLG" title="http://on.wsj.com/1q3xeLG">http://on.wsj.com/1q3xeLG</a>)</p> <p>* U.S. corporate-bond issuance is hurtling toward a record for the third consecutive year, as companies take advantage of a surprising interest-rate decline to stock up on cash. (<a href="http://on.wsj.com/1pPeC33" title="http://on.wsj.com/1pPeC33">http://on.wsj.com/1pPeC33</a>)</p> <p>* The Obama administration moved to restrict prescriptions of the most commonly used narcotic painkillers, with the Drug Enforcement Administration saying it would put hydrocodone combination drugs in the category reserved for medical substances with the highest potential for harm. (<a href="http://on.wsj.com/1rpaqKa" title="http://on.wsj.com/1rpaqKa">http://on.wsj.com/1rpaqKa</a>)</p> <p>* Sears Holdings Corp burned through more cash as its losses mounted in the second quarter, prompting the once venerable retailer to say it is weighing additional steps to shore up its balance sheet. (<a href="http://on.wsj.com/1v1cAjA" title="http://on.wsj.com/1v1cAjA">http://on.wsj.com/1v1cAjA</a>)</p> <p>* Citigroup Inc faces restrictions that will prevent it from selling investments in hedge funds and private-equity funds to wealthy clients, following a recent deal with U.S. regulators. (<a href="http://on.wsj.com/YGmsBR" title="http://on.wsj.com/YGmsBR">http://on.wsj.com/YGmsBR</a>)</p> <p>* Bank of America Corp's financial-crisis hangover may finally be fading. The bank agreed to pay $16.65 billion to settle the U.S. government's accusations it sold flawed mortgage securities in the run up to the 2008 crisis, the largest settlement ever reached between the United States and a single company. (<a href="http://on.wsj.com/1ljwCCS" title="http://on.wsj.com/1ljwCCS">http://on.wsj.com/1ljwCCS</a>)</p> <p>* Royal Bank of Canada is facing a conundrum about one of its fastest-growing businesses. The bank's capital-markets business, after fighting for years to become a global player, threatens to become a victim of its own success. Earnings from capital markets are bumping up against a self-imposed limit that is key to the risk control on which Canada's banks built their recent reputation. (<a href="http://on.wsj.com/1p15raD" title="http://on.wsj.com/1p15raD">http://on.wsj.com/1p15raD</a>)</p> <p>* Family Dollar Stores Inc rejected Dollar General Corp's $9 billion cash offer, opting instead to stick with Dollar Tree Inc's $8.5 billion cash-and-stock deal that is worth less money but may have an easier time passing muster with antitrust regulators. (<a href="http://on.wsj.com/1qvfOou" title="http://on.wsj.com/1qvfOou">http://on.wsj.com/1qvfOou</a>)</p> <p>* Jumpy commodities markets are taking hedge funds for a wild ride. A spate of unpredictable U.S. weather, a surprise record harvest and even a pig virus are giving commodities traders exactly what they craved: volatility. Unlike in years past, when star managers scored megapaydays in high-profile markets such as oil and gold, some of the biggest winners in recent months are in commodities like corn, soybeans, natural gas and electricity. (<a href="http://on.wsj.com/1sYz1VO" title="http://on.wsj.com/1sYz1VO">http://on.wsj.com/1sYz1VO</a>)</p> <p>* Home Depot Inc named company veteran Craig Menear its new chief executive on Thursday, handing him the challenge of keeping sales growing as the company shifts from building new U.S. stores to investing online. (<a href="http://on.wsj.com/1pPiaSZ" title="http://on.wsj.com/1pPiaSZ">http://on.wsj.com/1pPiaSZ</a>)</p> <p>* Al Gore and his business partners had "serious reservations" about selling Current TV to Al Jazeera, but ultimately overcame them because they believed the United States was likely to influence the Qatar-backed broadcaster more than the other way around, according to court papers filed on Thursday. (<a href="http://on.wsj.com/1tqIVxo" title="http://on.wsj.com/1tqIVxo">http://on.wsj.com/1tqIVxo</a>)</p> <p>* Dipchand Nishar, a LinkedIn Corp senior vice president who helped the professional social network expand internationally and on mobile devices, is resigning to pursue a chief executive post. (<a href="http://on.wsj.com/1z9syFU" title="http://on.wsj.com/1z9syFU">http://on.wsj.com/1z9syFU</a>)</p> <p>* Russian authorities stepped up their pressure on McDonald's Corp, saying they were inspecting restaurants across the country for alleged sanitary violations, a day after officials closed several outlets in Moscow. (<a href="http://on.wsj.com/XE8mAI" title="http://on.wsj.com/XE8mAI">http://on.wsj.com/XE8mAI</a>) </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">FT</span></em></p> <p>United States top security advisers say that the Islamist militant group in northern Iraq can be defeated only by tackling them in Syria, signalling an escalation of the country's military campaign.</p> <p>The United Arab Emirates' central bank on Thursday warned Standard Chartered Plc that it was liable to face legal action in the UAE after it agreed to close some customers' UAE accounts in an anti-money laundering settlement with U.S. authorities.</p> <p>Tougher western sanctions have come in the way of a planned $2 billion deal between Kremlin-backed Rosneft and oil trader Vitol.</p> <p>The world's biggest aluminium producer Rusal completed the restructuring of its $10 billion debt pile after negotiations with creditors that lasted a year.</p> <p>Executives at Rabobank of the Netherlands and Raiffeisen Bank International of Austria have warned of the impact of geopolitical tensions between the EU and Russia on their business.</p> <p>The head of UK's Channel 4 said the British television industry risked becoming a victim of its own success with U.S. takeovers of British TV companies threatening the UK's creative economy.</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">NYT</span></em></p> <p>* Sears Holdings Corp, which owns Sears and Kmart stores, announced on Thursday that it lost $975 million in the first six months of the year. (<a href="http://nyti.ms/1z9Opx8" title="http://nyti.ms/1z9Opx8">http://nyti.ms/1z9Opx8</a>)</p> <p>* As Europe slogs through its latest round of bank stress tests, a growing number of analysts have already reached their own conclusion: Eurozone banks need additional cash. (<a href="http://nyti.ms/1ohyB5s" title="http://nyti.ms/1ohyB5s">http://nyti.ms/1ohyB5s</a>)</p> <p>* Wall Street now finds itself with the public relations challenge of having to woo and retain young talent. As part of the effort, many new hires found out this week that they could be paid roughly 20 percent more than their counterparts were offered last year. (<a href="http://nyti.ms/1rpm33z" title="http://nyti.ms/1rpm33z">http://nyti.ms/1rpm33z</a>)</p> <p>* A federal court judge said on Thursday that Argentina's attempt to skirt one of his rulings was "lawless" but stopped short of finding the country in contempt of court. (<a href="http://nyti.ms/1wfQ6Nq" title="http://nyti.ms/1wfQ6Nq">http://nyti.ms/1wfQ6Nq</a>)</p> <p>* Dollar General Corp has offered more money to Family Dollar Stores Inc shareholders than Dollar Tree Inc's $8.5 billion deal, but it was not enough to sway the Family Dollar board. Rejecting a bid over concerns other than price when a higher offer is in place is dangerous ground for any board. Family Dollar's shareholders are bound to be wondering how this money can be left on the table. (<a href="http://nyti.ms/VJREhJ" title="http://nyti.ms/VJREhJ">http://nyti.ms/VJREhJ</a>)</p> <p>* New York's Department of Financial Services said on Thursday that it would extend by 45 days the comment period for its proposed virtual currency regulations. Those interested in submitting comments on the new rules will now have until Oct. 21. (<a href="http://nyti.ms/1q3RAnP" title="http://nyti.ms/1q3RAnP">http://nyti.ms/1q3RAnP</a>)</p> <p>* Bank of America's $16 billion mortgage settlement is less painful than it looks. The company's financial burden for the settlement may not exceed $12 billion - certainly a large amount, but one significantly less than the number the government trumpets. (<a href="http://nyti.ms/1qvvvvY" title="http://nyti.ms/1qvvvvY">http://nyti.ms/1qvvvvY</a>)</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Canada</span></em></p> <p>THE GLOBE AND MAIL</p> <p>* Ontario and Quebec are forging a central Canadian alliance to co-operate on issues, including potentially expanding electricity trade, hoping their combined clout will bring back prosperity to both provinces. Ontario's Kathleen Wynne and Quebec's Philippe Couillard announced the new regional partnership in Quebec City on Thursday. (<a href="http://bit.ly/1ADlMeg" title="http://bit.ly/1ADlMeg">http://bit.ly/1ADlMeg</a>)</p> <p>* With students and parents preparing for an extension of the ongoing teacher strike into the new school year, a public spat erupted on Thursday after British Columbia's education minister, Peter Fassbender said negotiations are impossible because the leaders of the British Columbia Teachers' Federation are at a conference in Kamloops. (<a href="http://bit.ly/1pPPcT5" title="http://bit.ly/1pPPcT5">http://bit.ly/1pPPcT5</a>)</p> <p>Reports in the business section:</p> <p>* Calgary energy company, Penn West Petroleum Ltd bogged down by debt following its biggest deal, the C$3.6billion takeover of Canetic Resources Trust, had devised an aggressive growth plan to spend heavily on new drilling techniques in hopes of sending production and cash flow soaring. In the end, though, Penn West could not drill itself to success. That led to a host of management changes and asset sales in an effort to refocus the company. But now it faces a new problem: the discovery of accounting irregularities in the hundreds of millions of dollars, making it the target of numerous investor lawsuits and clouding its future. (<a href="http://bit.ly/1s8C8GH" title="http://bit.ly/1s8C8GH">http://bit.ly/1s8C8GH</a>)</p> <p>NATIONAL POST</p> <p>* The Royal Canadian Mounted Police are considering outsourcing the replacement and modernization of the national sex offender registry and the creation of a proposed new public website to the private sector. This is in advance of new legislation, expected this fall, which will toughen penalties for sexual predators. (<a href="http://bit.ly/1q47JK9" title="http://bit.ly/1q47JK9">http://bit.ly/1q47JK9</a>)</p> <p>* Canadian Prime Minister Stephen Harper says police investigations, not a national inquiry, are the best way to deal with crimes involving missing and murdered aboriginal women. The death of Tina Fontaine, a 15-year-old aboriginal girl found wrapped in a bag and dumped in the Red River has prompted renewed calls for a national inquiry. But the conservative government has rejected all calls for a national inquiry, saying it prefers to address the issue in other ways, such as through aboriginal justice programs and a national DNA missing person's index. (<a href="http://bit.ly/1txH8W8" title="http://bit.ly/1txH8W8">http://bit.ly/1txH8W8</a>)</p> <p>FINANCIAL POST</p> <p>* The Ontario Securities Commission is allocating C$2.5 million collected from monetary sanctions and settlements to the Canadian Foundation for Advancement of Investor Rights. The bulk of the funds for the investor advocacy group will be placed in trust with the recently established FAIR Canada Jarislowsky Endowment Fund for long-term funding of the organization. The remaining C$500,000 will cover day-to-day operating expenses at FAIR. (<a href="http://bit.ly/1pZ76T7" title="http://bit.ly/1pZ76T7">http://bit.ly/1pZ76T7</a>)</p> <p>* Stockwell Day, the former federal international trade minister and former Alberta treasurer, has joined the management team of Pacific Future Energy Corp as a senior advisor, director, and chair of the company's advisory committee. The Vancouver-based company backed by Mexico's Grupo Salinas is proposing a C$10 billion refinery on British Columbia's North Coast. (<a href="http://bit.ly/1ohEPC9" title="http://bit.ly/1ohEPC9">http://bit.ly/1ohEPC9</a>) </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Hong-Kong</span></em></p> <p>SOUTH CHINA MORNING POST</p> <p>-- State media have started to roll out articles lambasting the luxurious lives of senior executives at state-owned enterprises - a clear indication, observers say, that President Xi Jinping not only plans to cut their perks, but will make them the next target of his anti-graft campaign. (<a href="http://bit.ly/1twex3C" title="http://bit.ly/1twex3C">http://bit.ly/1twex3C</a>)</p> <p>-- Facebook outranks popular messaging applications WhatsApp and WeChat as the most favoured digital platform in Hong Kong, according to a survey commissioned by the social network and conducted by market researchers TNS. (<a href="http://bit.ly/1sYoYjM" title="http://bit.ly/1sYoYjM">http://bit.ly/1sYoYjM</a>)</p> <p>-- Coolpad, one of China's smartphone brands, plans an aggressive expansion into overseas markets and greater online sales in the second half of this year. Chairman Guo Deying said the firm would focus on providing customised smartphones for mobile network operators in Asia, North America, Europe and other markets. (<a href="http://bit.ly/1pXiyOZ" title="http://bit.ly/1pXiyOZ">http://bit.ly/1pXiyOZ</a>)</p> <p>THE STANDARD</p> <p>-- Department store operator AEON Stores (Hong Kong) said it returned to the black in the first half, earning HK$81.94 million. The U-turn, from a loss of HK$26.34 million a year back, was driven by better operating results from the mainland and a fair value gain from a property investment along with lower impairment costs. (<a href="http://bit.ly/1s78W2B2384" title="http://bit.ly/1s78W2B2384">http://bit.ly/1s78W2B2384</a>)</p> <p>-- Electrical appliance maker Techtronic Industries Co said it would continue to invest in product enhancement despite capital expenditure surging 35 percent in the first half from a year earlier. Group Chief Financial Officer Frank Chan said $64 million was spent on acquisitions and raising productivity. (<a href="http://bit.ly/1pP6FLo" title="http://bit.ly/1pP6FLo">http://bit.ly/1pP6FLo</a>)</p> <p>HONG KONG ECONOMIC TIMES</p> <p>-- Chinese sportswear firm Xtep International Holdings Ltd , which posted a 16.6 percent fall in first-half net profit, sees industry consolidation coming to an end and expects same-store sales to return to double-digit growth in the third quarter from single-digit growth in the second quarter, according to Chief Financial Officer Ho Yui-pok.</p> <p>MING PAO DAILY NEWS</p> <p>-- The Link Real Estate Investment Trust is seen planning to sell six shopping malls in Kowloon and New Territories, which can generate about HK$2 billion $(258 million), according to market sources.</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Britain</span></em></p> <p>The Times</p> <p>MILIBAND BLAMED FOR HIGH ENERGY PRICES</p> <p>The boss of one of the United Kingdom's biggest energy companies has blamed Labour's threatened price freeze for his group's failure to cut bills, despite the recent slump in wholesale gas prices.</p> <p>BURBERRY BOSS CLASHES WITH INVESTORS OVER SALE</p> <p>Only six weeks after a revolt by investors over excessive pay at Burberry, its boss has boosted his bank balance by cashing in 5.2 million pounds worth of shares.</p> <p>The Guardian</p> <p>LONDON HEDGE FUND EXECUTIVES SEE PAY PACKETS HALVE AS BONUSES PLUMMET</p> <p>Hedge fund executives in London saw bonuses plummet last year, resulting in their pay packets being less than half of what they were 12 months ago.</p> <p>BRITISH TV INDUSTRY AT RISK FROM U.S. TECH AND MEDIA GIANTS, SAYS CHANNEL 4 CHIEF David Abraham says creativity will be sacrificed for profit as U.S. companies buy up British broadcasters and producers.</p> <p>The Telegraph</p> <p>SCOTTISH BUSINESS LEADERS PREPARE TO UNITE AGAINST INDEPENDENCE</p> <p>More than 100 business leaders with Scottish operations are planning to speak out against independence for the first time in a united statement that could be a hammerblow for Alex Salmond, The Telegraph has learned.</p> <p>Sky News</p> <p>HEDGE FUNDS URGE FASTER CO-OP BANK OVERHAUL</p> <p>The Co-operative Bank Plc is facing demands from some of its biggest shareholders to accelerate an overhaul of its operations and commercial strategy. </p> <p>&nbsp;</p> <p><strong>Fly On The Wall Pre-market Buzz</strong></p> <p>ECONOMIC REPORTS</p> <p>No economic reports scheduled. Janet Yellen is scheduled to speak at 10am</p> <p>&nbsp;</p> <p>ANALYST RESEARCH</p> <p>Upgrades</p> <p>AK Steel (AKS) upgraded to Neutral from Sell at UBS<br />Edison International (EIX) upgraded to Outperform from Market Perform at BMO Capital<br />Gap (GPS) upgraded to Buy from Neutral at Janney Capital<br />Inter Parfums (IPAR) upgraded to Buy from Neutral at Citigroup </p> <p>Downgrades</p> <p>Ampio (AMPE) downgraded to Hold from Buy at Jefferies<br />Cyberonics (CYBX) downgraded to Hold from Buy at Canaccord<br />DCT Industrial (DCT) downgraded to Market Perform from Outperform at BMO Capital<br />Liberty Property (LPT) downgraded to Market Perform from Outperform at BMO Capital</p> <p>Initiations</p> <p>MobileIron (MOBL) initiated with an Outperform at Imperial Capital<br />SuperCom (SPCB) initiated with an Outperform at Imperial Capital</p> <p>COMPANY NEWS</p> <p>Home Depot (HD) announced that Craig Menear will replace Frank Blake as CEO, effective November 1<br />Gap (GPS), which reported Q2 results above analyst estimates, announced plans to open the first franchise-operated Gap stores in India in 2015<br />OncoGenex (OGXI) said its Phase 3 ENSPIRIT Trial passes early interim futility analysis<br />Salesforce.com (CRM) said it is targeting $1.1B in cash flow at end of FY15, next company goal is $10B in annual revenue<br />LinkedIn (LNKD) product head Dipchand “Deep” Nishar to leave company, effective October 3</p> <p>EARNINGS</p> <p>Companies that beat consensus earnings expectations last night and today include:</p> <p>Salesforce.com (CRM), Brocade (BRCD), GameStop (GME), Gap (GPS), Hibbett Sports (HIBB), Royal Bank of Canada (RY), Nordson (NDSN), Scansource (SCSC), The Fresh Market (TFM), TravelCenters (TA), Lantronix (LTRX), Mentor Graphics (MENT), Marvell (MRVL), MICROS (MCRS), Ross Stores (ROST)</p> <p>Companies that missed consensus earnings expectations include:</p> <p>Qunar (QUNR), Accuray (ARAY), Tuesday Morning (TUES), Tuesday Morning (TUES), Intuit (INTU)</p> <p>Companies that matched consensus earnings expectations include:</p> <p>New York &amp; Co. (NWY)</p> <p>Salesforce.com (CRM) raises FY15 adjusted EPS view to 50c-52c from 49c-51c<br />GameStop (GME) sees FY14 EPS $3.40-$3.70, consensus $3.68<br />GameStop (GME) sees Q3 EPS 58c-64c, consensus 59c<br />Salesforce.com (CRM) sees Q3 adjusted EPS 12c-13c, consensus 13c<br />Brocade (BRCD) sees Q4 EPS 21c-23c, consensus 22c<br />Intuit (INTU) sees FY15 adjusted EPS $2.45-$2.50, consensus $3.97<br />Gap (GPS) raises FY14 EPS view to $2.95-$3.00, consensus $2.95</p> <p>NEWSPAPERS/WEBSITES</p> <p>Apple (AAPL) suppliers scramble after iPhone 6 screen hurdle, Reuters says<br />Citigroup (C) faces restrictions on hedge-fund sales, WSJ reports<br />Comcast (CMCSA) launches streaming TV services for college campuses, WSJ reports (NFLX)<br />Qualcomm (QCOM) seeks to end anti-trust probe, China regulator says, Reuters reports<br />Allergan's (AGN) suit against Valeant (VRX) won't delay special meeting, NY Times reports<br />GT Advanced (GTAT) estimated to supply 1.35M-2.25M 5.5-inch iPhone sapphire covers by end of 2014, DigiTimes reports</p> <p>SYNDICATE</p> <p>Avago (AVGO) files to sell $1B of 2% convertible senior notes due 2021<br />BIOLASE (BIOL) files to sell 6.25M shares for holders<br />Fidus Investment (FDUS) enters $50M equity distribution agreement<br />TriNet (TNET) files to sell $100M in common stock</p> http://www.zerohedge.com/news/2014-08-22/frontrunning-august-22#comments 8.5% Apple Bank of America Bank of America Capital Markets China Citigroup Comcast Creditors Dollar General Eurozone General Motors Global Economy Hong Kong India Iraq Janet Yellen Natural Gas Netherlands Obama Administration Oklahoma Raiffeisen Real estate Reuters Sears Standard Chartered Twitter Twitter Ukraine Volatility Fri, 22 Aug 2014 11:53:50 +0000 Tyler Durden 493340 at http://www.zerohedge.com Futures Tread Water As Ukraine Tries To Steal The Jackson Hole Scene http://www.zerohedge.com/news/2014-08-22/futures-tread-water-ukraine-tries-steal-jackson-hole-scene <p>While today's key events were supposed to be the Jackson speeches first by Janet Yellen at 10:00am Eastern and then by Mario Draghi at 2:30 pm, Ukraine quickly managed to steal the spotlight yet again when moments after the first Russian humanitarian aid convoys entered Ukraine allegedly without permission, Kiev first accused Russia of staging a direct invasion, even if moments later it changed its tune and said it had allowed the convoy in to "avoid provocations." In other words, your daily dose of Ukraine disinformation, which initially managed to push futures down some 0.3% before futs regained virtually all losses on the subsequent clarifications. Expect much more conflicting, confusing and very provocative headlines out of Kiev as the local government and the CIA try to get their story straight. </p> <p>In terms of overnight markets, Asian equities and credits are mostly firmer ahead of Jackson Hole. The Shanghai Composite ad HSCEI indices are both around 0.2% as they recover somewhat from yesterday’s disappointing flash manufacturing PMI. Chinese stocks are poised to close higher for the 6th consecutive week in what would be its longest streak since March 2012. Elsewhere in Asia the Nikkei is flat on the day while the Hang Seng and the KOSPI are +0.4% and +0.5%, respectively. Turning to credit, Asian IG cash continues to grind tighter amid very light supply. Key benchmarks are about 1bps tighter as we type. The UST 10-year yields are a touch firmer at 2.40% while the Dollar index is unchanged. </p> <p>After initially opening flat, European equities drifted slightly lower ahead of the US crossover on position squaring ahead of Fed Chair Yellen’s appearance at Jackson Hole. The financials sector is slightly supporting the indices as European bank stocks look forward to ECB’s Draghi speech in Wyoming, expected to stress the broad divergence in monetary policy between the US and the Eurozone. Vodafone (+1.1%) shares traded in minor positive territory this morning after AT&amp;T bid chatter was recycled in UK press. US stock futures trade relatively flat ahead of the open, with record highs still well within reach. In pre-market news, Apple (AAPL) are reportedly suffering from supply chain issues, with the drive for a thinner iPhone model is causing backlight issues, with the supply chain source remaining unsure on whether this could delay release.</p> <p>There is nothing of note on today's US econ release docket: it will be a very quiet day for data which sets up the spotlight nicely for Yellen and friends at Jackson Hole.</p> <p><strong>Bulletin headline summary from RanSquawk and Bloomberg:</strong></p> <ul> <li>After a flat open, Bund futures broke above yesterday’s highs of 150.40 as markets remain wary over Russia’s aid convoy making its way to Luhansk – reportedly escorted by a small group of pro-Russian rebels without Kiev’s approval </li> <li>European equity markets trade slightly lower on position squaring ahead of various central bank speeches in Jackson Hole, Wyoming later today </li> <li>Speeches from Fed Chair Yellen (1500BST/0900CDT) and ECB Governor Draghi (1930BST/1330CDT) are expected to stress the policy divergence between the Federal Reserve and the ECB</li> </ul> <p><strong>FIXED INCOME </strong></p> <p>European fixed income futures opened flat amid particularly light newsflow and thin volumes. Nonetheless, Bund futures broke above yesterday’s highs as Russia warned that any disruption to the aid convoy heading toward Luhansk, eastern Ukraine would not be tolerated. Still, volumes below 100k in Sep-14 Bund futures kept price action relatively erratic. Despite this, witness reports suggest the aid convoy is being escorted by a small number of pro-Russian rebels, without Ukraine’s consent is keeping markets wary of the developments. Core fixed income markets remain somewhat supported by the particularly chunky month-end extensions, particularly in the US:</p> <p>Prelim Barclays month end extension for Pan-Euro Agg at +0.03y (Prev. 0.12yrs, 12m average +0.03yrs)<br />Prelim Barclays month end extension for Sterling Agg Tsy at +0.08y<br />Prelim Barclays month end extension for US Treasuries +0.12yrs (Prev. 0.08yrs, 12m average +0.09yrs)</p> <p><strong>EQUITIES</strong></p> <p>After initially opening flat, European equities drifted slightly lower ahead of the US crossover on position squaring ahead of Fed Chair Yellen’s appearance at Jackson Hole. The financials sector is slightly supporting the indices as European bank stocks look forward to ECB’s Draghi speech in Wyoming, expected to stress the broad divergence in monetary policy between the US and the Eurozone. Vodafone (+1.1%) shares traded in minor positive territory this morning after AT&amp;T bid chatter was recycled in UK press. US stock futures trade relatively flat ahead of the open, with record highs still well within reach. In pre-market news, Apple (AAPL) are reportedly suffering from supply chain issues, with the drive for a thinner iPhone model is causing backlight issues, with the supply chain source remaining unsure on whether this could delay release.</p> <p><strong>FX</strong></p> <p>The USD continued to retreat from 11-month highs this morning, allowing EUR/USD and GBP/USD to pull back toward 1.3300 and 1.6600 respectively. Elsewhere, USD/JPY trades slightly lower as the pair continues to retreat way from 104.00 after a failure to break that level yesterday. Looking ahead, Canadian CPI will likely dictate the USD/CAD range, with a slew of option expiries at 1.0920-25 (280mln) and 1.1000 (1.23bln) at the 10am (1500BST) NY cut particularly close to market.</p> <p><strong>COMMODITIES</strong></p> <p>WTI and Brent crude futures fell ahead of the NYMEX open, with WTI futures prices retreating to the mid-point of yesterday’s range, on track to mark a sharp weekly loss of over USD 1.50/bbl. Spot gold still sits below the 200DMA at USD 1,284.49, however has benefited this morning from renewed risk surrounding eastern Ukraine and a moderately softer USD.</p> <p>* * * </p> <p><strong>DB's Jim Reid, or rather his team while he is on vacation, concludes the rest of the overnight events</strong></p> <p>The Jackson Hole symposium is the main event for today. If that wasn’t enough we also have an all star line up of central bank governors this year. All eyes will clearly be on the Yellen’s key note address but this time round we’ll also hear from Draghi at lunchtime, Kuroda from the Bank of Japan, and Broadbent from the Bank of England. It was 2011 when we last had both the Fed Chair and ECB President at Jackson Lake Lodge so today’s line up is certainly eye-catching especially given the policy divergence amongst the themselves. The theme of this year's symposium is "Re-Evaluating Labour Market Dynamics". Yellen will kick things off with her opening remarks at 8.30am local time (3pm UKT) followed by a luncheon address from Draghi at 12.30pm (7.30pm UKT). Broadbent, Kuroda and Tombini are panellists at a panel discussion titled ‚Labour Markets and Monetary Policy? the next day which could be an interesting one given Carney’s recent comments on wages. </p> <p>So what can we expect from Yellen? Our US economists expect the Fed Chair to provide us with an updated assessment on the infamous ‘Yellen dashboard’ in evaluating the ongoing labour market slack and how they have yet to normalise relative to 2002-2007 levels. Some of these alternative measures she monitors include duration of unemployment, quit rate in JOLTS data, labour force participation etc. Any sound bite that touches on the debate of cyclical versus structural drivers of labour force participation will also be closely followed. Unlike some of the previous Jackson Hole symposiums, this is likely not one that will serve as a precursor of any monetary policy changes but the tone of Yellen's speech may still have a market impact and set the mood for busier times ahead in September. Given markets are seemingly expecting nothing but another dovish display from Yellen the risk is perhaps skewed to the other side. </p> <p>In terms of overnight markets, Asian equities and credits are mostly firmer ahead of Jackson Hole. The Shanghai Composite ad HSCEI indices are both around 0.2% as they recover somewhat from yesterday’s disappointing flash manufacturing PMI. Chinese stocks are poised to close higher for the 6th consecutive week in what would be its longest streak since March 2012. Elsewhere in Asia the Nikkei is flat on the day while the Hang Seng and the KOSPI are +0.4% and +0.5%, respectively. Turning to credit, Asian IG cash continues to grind tighter amid very light supply. Key benchmarks are about 1bps tighter as we type. The UST 10-year yields are a touch firmer at 2.40% while the Dollar index is unchanged. </p> <p>Staying on macro matters we thought global supply chain manager Li &amp; Fung’s latest results yesterday offered some interesting anecdotes. The company’s performance for the first 6 months was hampered by ongoing macroeconomic weakness, geopolitical and weather events in its key destination markets (US and Europe). Price discounting remains a theme in US retail even beyond the end of June. The company also noted a reduction of foreign tourist flow by Russian tourists into Europe which is affecting retail markets there. This fits consistently well with some of the ECB’s geopolitical concerns outlined at its previous policy meeting.</p> <p>Back to yesterday markets had a positive day as strong US data outweighed the mixed European PMI reads. The Eurozone Composite PMI disappointed, falling to 52.8 vs expectation of 53.4. As our European economists noted yesterday, the disappointment was driven by the periphery as the combined Italian, Spanish and Irish index fell by 1.8 points compared to a fall on the combined German-French composite PMI index of 0.1 points (implied consensus -0.4). Other then this regional divergence, there was a continued divergence between the Eurozone services and manufacturing read as the former came in just below expectation (53.5 vs 53.7) whilst the latter came in at 50.8 vs expectation of 51.3. In terms of what these reads mean for Europe, according to our economists these reads are still consistent with between +0.3% and +0.4% qoq GDP growth in Q3 GDP.</p> <p>Across the Atlantic, it was a strong day for US data with every data point of note beating expectation. The initial jobless claims came in lower than expected at 298k (vs 303k consensus). On the activity side the Markit manufacturing PMI came in at an impressive 58 (vs 55.8 consensus), the highest read in the indexes 3 year history, the Philly Fed reached its highest level in over 3 and a half years at 28, and finally the string of good US housing data continued with July existing home sales coming in at +2.4% MoM against expectations that it would slip -0.5%. </p> <p>Despite the mixed European PMI data stocks in Europe were up with the Stoxx 600 up +0.66% led by strong gains on the FTSE MIB (+2.06%), IBEX 35 (+1.30%) and CAC (+1.23%). Credit also performed yesterday with iBoxx Main and Xover -1bp and -3bps tighter. Yesterday’s peripheral outperformance even given the PMI’s suggests the moves were largely driven by rising expectations for European QE activism which probably adds more importance (if any were needed) to Draghi’s luncheon speech later today. Over in the US, the stronger data were clearly helpful which saw the S&amp;P 500 (+0.29%) close at a new all time high of 1992. In US credit, the CDX IG and HY moved -2bp and -6bps tighter, respectively. </p> <p>Whilst on Credit it’s worth noting that weekly US HY fund flows turned positive for the first time in 7 weeks. According to EPFR data the asset class received inflows of US$2.7bn during the week that ended 20 August vs an outflow of US$781m in the previous week and US$8.2bn the week before that. European HY outflows have also slowed down with the latest weekly outflows coming in at US$193m versus US$654m in the previous week and US$934m the week prior to that. </p> <p>Moving on to geopolitical updates, US strikes have continued in Iraq in support of Kurdish and Iraqi forces fighting IS near the city of Mosul (BBC). In Ukraine, guards at the country’s border have begun to inspect the Russian aid convoy’s trucks. Ukrainian President yesterday also announced that he may dissolve parliament as early as Sunday to set up parliamentary elections in late October (Reuters). Focus this weekend will be his meeting with Merkel at home followed by the Russia-Ukraine summit in Minsk next Tuesday in an effort to de-escalate the conflict. </p> <p>Looking ahead to today it will be a very quiet day for data which sets up the spotlight nicely for Yellen and friends at Jackson Hole.</p> http://www.zerohedge.com/news/2014-08-22/futures-tread-water-ukraine-tries-steal-jackson-hole-scene#comments Apple Bank of England Bank of Japan Barclays CPI Crude Equity Markets ETC Eurozone Federal Reserve fixed Fund Flows headlines Initial Jobless Claims Iraq Janet Yellen Japan Jim Reid Markit Monetary Policy Nikkei NYMEX Philly Fed Price Action RANSquawk Reuters Ukraine Unemployment Fri, 22 Aug 2014 11:15:22 +0000 Tyler Durden 493339 at http://www.zerohedge.com Buy Physical Gold and Silver Bars - Ex Mafia Boss http://www.zerohedge.com/news/2014-08-22/buy-physical-gold-and-silver-bars-ex-mafia-boss <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: bold; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><a href="http://www.cnbc.com/id/101932292" style="text-decoration: none;"><span style="font-size: 15px; font-family: Calibri; color: #1155cc; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: underline; vertical-align: baseline; white-space: pre-wrap;"><img src="https://lh5.googleusercontent.com/HwcwGDOk9vYZMzl8w2aWC3WYxRfnp8sy0lCvhapj2KS9yGa6EtL4mXbwy66Qbjh7AMwknwMVV8NLOZ8wuDH_iMEezUPgZDJPt3ebN9avoJeQ_mNVI6cbdedj-tgNoP4nEw" width="522px;" height="287px;" style="border: none; transform: rotate(0.00rad);" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span></a><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Michael Franzese, the former powerful mafia boss turned motivational speaker and author, warned on </span><a href="http://www.cnbc.com/id/101932292" style="text-decoration: none;"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: underline; vertical-align: baseline; white-space: pre-wrap;">CNBC</span></a><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"> that stocks are a bubble, Wall Street is crooked and advised people to own physical gold and silver bars. </span></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Asked for his “top investment tips,” Franzese told CNBC:</span></p> <p><strong id="docs-internal-guid-3fc50743-fcf6-49f3-54f7-7c6b8ae93b38" style="font-weight: normal;"><br /></strong></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">“I did a lot of things at times with people on Wall Street and I don’t trust them … that is the bottom line … a lot of [Wall Street] guys are shady and they did shady things with me and I don’t trust them. And I don’t like other people that I don’t know really well taking care of my money. I think that I can do it better.”</span></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Regarding stocks he said he thinks “there is a bubble there and when it bursts it is not going to be good.”</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">He said he would not invest in gold ETFs, rather he owns physical bars:</span></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">“No matter what, it’s &lt;bullion bars&gt; always going to have a value and there will always be something there.”</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><img src="https://lh5.googleusercontent.com/K0EJ9fssLPYskxwzuWYYLuHElx38e9xzKn6F7bH0MPvosB8UgskZ9PjgcAYmriQPNLNSv34GvPUOgKnng72sx0IT1Vgm07RzQ6e8hDIy4X3ZTh59kMvgeGMEYKwCH1Arvg" width="191px;" height="299px;" style="border: none; transform: rotate(0.00rad);" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">“Unlike stocks, where in our country, you go to sleep, everyone tells you everything is wonderful, you wake up and everything is gone. We have experience that. Fortunately, I wasn’t invested at the time.”</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">The interviewer asks “it sounds like you are bracing for Armageddon?”</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Franzese says “Well I don’t think so … that’s been my experience and I have done that successfully and like I said I always have something to hold onto.”</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Regarding diversification, he agrees with diversification but says you need to have knowledge and understand what you are investing in and not allow others to pick investments for you. </span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">The Colombo crime family’s former boss – Michael Franzese – says even he doesn’t trust Wall Street.</span></p> <p><strong style="font-weight: normal;"><br /></strong></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">Franzese – played by Joseph Bono in the 1990 Martin Scorsese movie “GoodFellas” – spent 10 years in prison after he was convicted on federal racketeering charges.</span></p> <p><strong style="font-weight: normal;"><br /></strong></p> <p style="line-height: 1.1500000000000001; margin-top: 0pt; margin-bottom: 0pt;" dir="ltr"><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">When he was 35, Franzese ranked number 8 on Fortune Magazine’s list of the 50 most wealthy and powerful mafia bosses. 44 of those on the list are now dead, and three are doing life in prison without parole. He reportedly raked in up to $8 million a week. &nbsp;Franzese is the only surviving high-ranking member of a major crime family to publicly walk away and refuse protective custody.</span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;"><br class="kix-line-break" /></span><span style="font-size: 15px; font-family: Calibri; color: #222222; background-color: #ffffff; font-weight: normal; font-style: normal; font-variant: normal; text-decoration: none; vertical-align: baseline; white-space: pre-wrap;">He also said that what made him turn over a new leaf was the love of a good woman who is now his wife of 29 years.</span></p> <p><span style="color: #222222; font-family: Calibri; font-size: 15px; white-space: pre-wrap; line-height: 1.1500000000000001;"><br />Franzese is right to be wary of Wall Street given the litany of fraudulent activities uncovered in recent years. Bullion banks have been found to be charging “storage fees” to store gold bullion … without having the bullion in storage. They also offer unallocated gold accounts where there is not the &nbsp;ounce for ounce backing of clients purchases - meaning that the same gold is pledged to numerous people.</span></p> <p><span style="color: #222222; font-family: Calibri; font-size: 15px; white-space: pre-wrap; line-height: 1.1500000000000001;"><br />Owning physical gold coins and bars, rather than paper gold or gold owned via a digital platform, remains the safest way to own gold.</span></p> <p><span style="line-height: 1.3em; font-size: 15px; font-family: Calibri; color: #222222; font-weight: bold; vertical-align: baseline; white-space: pre-wrap;">Inform yourself of the </span><a href="http://info.goldcore.com/how-to-store-gold-bullion-the-seven-key-must-haves-in-2014" style="font-size: 1em; line-height: 1.3em;"><span style="font-size: 15px; font-family: Calibri; color: #222222; font-weight: bold; vertical-align: baseline; white-space: pre-wrap;">7 Key Gold Storage Must Haves</span></a><span style="line-height: 1.3em; font-size: 15px; font-family: Calibri; color: #222222; font-weight: bold; vertical-align: baseline; white-space: pre-wrap;"> </span><a href="http://info.goldcore.com/how-to-store-gold-bullion-the-seven-key-must-haves-in-2014" style="font-size: 1em; line-height: 1.3em;"><span style="font-size: 15px; font-family: Calibri; color: #0000ff; font-weight: bold; text-decoration: underline; vertical-align: baseline; white-space: pre-wrap;">here</span></a></p> http://www.zerohedge.com/news/2014-08-22/buy-physical-gold-and-silver-bars-ex-mafia-boss#comments Racketeering Fri, 22 Aug 2014 09:07:19 +0000 GoldCore 493337 at http://www.zerohedge.com