http://www.zerohedge.com/fullrss2.xml/wp-content/plugins/uBillboard/Korean en Bill Blain: "It Feels Like The Markets Are In A Limbo Phase" http://www.zerohedge.com/news/2017-03-23/bill-blain-it-feels-markets-are-limbo-phase <p><em>From the March 23 edition of Bill Blain's Morning Porridge </em></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>“Offer him full and unfettered cooperation, no.. full and willing cooperation.. Then I will tell you which papers to burn.” </p> </blockquote> <p>There is plenty written elsewhere about yesterday’s Lone Wolf terror attack in London. Hardening electoral sentiment is one danger – that’s their aim. Populism fuels Islamophobia which is the perverse goal of the Jihadis. Many analysts are terrified of the potential effects of attacks in France before the final ballot: how much will outrage benefit Le Pen? Be vigilant. </p> <p>Back to markets, <strong>and it feels like we are in a limbo phase. Something is happening, but we don’t know what it is. The biggest game in town remains the dollar and the outlook for the US… but for how long?</strong></p> <p>Trump’s set-piece reform and replacement of Obamacare is proving a nightmare to move through Congress. Its become his touchstone – and if he fails expect ructions. There are signs and signals a compromise is on the cards: getting rise of affordable care (leaving millions of American’s uninsured). The Donald is discovering Government of the people by the people is not an easy thing. </p> <p>The debate has revealed the complexity and cost of health insurance while exposing fault lines in Republican politics – appeasing the Freedom Caucus isn’t easy! Some kind of compromise involving State budget reconciliation rules will be worked up.. not that I understand exactly how. I’m sure barrels of pork will be involved somehow. All of which stinks of Beltway politics… which I thought we were going to avoid. Ach well.</p> <p>So where does that leave the rest of the Trump Jump policies? Do they fall by the wayside because they are difficult? Do we still get the spending and overarching tax-reform we have been promised? Er.. increasingly I doubt it. The Swamp could yet swallow Trump’s ambition.</p> <p>We will probably get more tinkering around the edges with the promised reforms slipping down the agenda till next year, or the year after that. Gridlock.</p> <p><strong>Other articles raise the threat of Trump lashing out to create a collision with the Fed – pushing back against Yellen’s tightening programme to desperately keep growth numbers up. Messy. That won’t help markets. </strong></p> <p>The Trump basket of tax-reform (both corporate and personal), plus a healthy big dollar-number infrastructure plan to rebuild America was going to change the world. <strong>Instead it’s bogged down in Washington Trenches while the new Emperor fiddles and suspects treachery in every corner. </strong></p> <p>Instead of fixing the US’s chronic internal communications and infrastructure, we’re going to get a 350 ship navy. Marvellous. </p> <p>The ships built by the last President to achieve that number are now being recycled into shaving blades. Remember, a new road or railway is for ever.. a new aircraft carrier is until the new Chinese ballistic missiles make it obsolete. (Which probably already happened..)</p> <p>Trump may not have grasped it, but he needs the support of Congress; the House and Senate – not just Republicans but also Democrats – to move through policy. <strong>The danger is he keeps haemorrhaging support while “distracted” by Fake News, Russian, Travel Bans, Mexican Walls and the rest. At some point he’s going to understand he is the servant of the people, not the other way around. But we know that.. its just that he doesn’t. Trade it accordingly. </strong></p> <p>Comprehensive tax reform now looks a massive ask – if its not revenue neutral it requires 60 Senate Votes, otherwise even a straight majority means it will expire in 10-yrs. Somehow I doubt its going to happen.</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="460" height="272" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/traders%20looking_20.jpg?1490262900" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-23/bill-blain-it-feels-markets-are-limbo-phase#comments American people of German descent Business Climate change skepticism and denial Congress Donald Trump France Obamacare Politics Politics of the United States Senate The Apprentice United States US Federal Reserve WWE Hall of Fame Thu, 23 Mar 2017 09:55:10 +0000 Tyler Durden 591541 at http://www.zerohedge.com Is This The Sound Of The Bottom Falling Out Of The Auto Industry? http://www.zerohedge.com/news/2017-03-22/sound-bottom-falling-out-auto-industry <p><a href="http://wolfstreet.com/2017/03/21/used-vehicle-wholesale-prices-fall-bottom-falling-out-of-auto-industry/"><em>Authored by Wolf Richter via WolfStreet.com,</em></a></p> <p><em><strong>Not quite, not yet, but it&rsquo;s not good either.</strong></em></p> <p>Let&rsquo;s hope that the problems piling up in the used vehicle market - and their impact on new vehicle sales, automakers, $1.1 trillion in auto loans, and auto lenders - is <strong>just a blip</strong>, something caused by what has been getting blamed by just about everyone now:<strong> the delayed tax refunds.</strong></p> <p>In its March <a href="http://img03.en25.com/Web/NADAUCG/%7B834e8da5-4828-4cfa-88ee-18e6678e0329%7D_Guidelines_UCG_201703.pdf" target="_blank">report</a>, the National Association of Auto Dealers (NADA) reported an anomaly: dropping used vehicle prices in February, which occurred only for the second time in the past 20 years. It was a big one: Its Used Car Guide&rsquo;s seasonally adjusted used vehicle price index plunged 3.8% from January, &ldquo;by far the worst recorded for any month since November 2008 as the result of a recession-related 5.6% tumble.&rdquo;</p> <p><strong>The index has now dropped eight months in a row and hit the lowest level since September 2010. The index is down 8% year over year, and down 13% from its peak in 2014.</strong></p> <p>The price decline spanned all segments, but it hit the two ends of the spectrum &mdash; subcompact cars and the luxury end &mdash; particularly hard. The list shows the change in wholesale prices from January to February in vehicles up to eight years old:</p> <p><img class="alignnone size-full wp-image-31406" height="332" src="http://wolfstreet.com/wp-content/uploads/2017/03/US-auto-used-vehicle-prices-2017-02.png" width="215" /></p> <p>NADA blamed three factors:</p> <ol> <li><strong>The surge in new vehicle incentive spending</strong>. Automakers, drowning in unsold inventories on dealer lots and desperate to move the iron and keep their plants running, increased incentive spending by 18% to the highest level in over a decade. This made new vehicle more competitive with late-model used vehicles. So this would be on the demand side.</li> <li><strong>The growing flood of used vehicles going through auction.</strong>&nbsp;Over the first two months this year, volume of vehicles up to eight years old rose by about 5% year-over-year. Volume of late-model vehicles &ndash; the supply from rental car companies and lease turn-ins &ndash; jumped 10%. So that&rsquo;s on the supply side.</li> <li><strong>The IRS tax refund fiasco</strong>. Restaurants, retailers, and others are already blaming various February debacles on these delayed tax refunds. After the IRS was hit with millions of fake e-filed tax returns last year that claimed the Earned Income Tax Credit and the Additional Child Tax Credit, Congress required the agency to delay sending out refunds this year.</li> </ol> <p>It&rsquo;s big money. According to the IRS, refunds issued through February 10 plunged 69% from the same period a year ago. That&rsquo;s $65 billion that didn&rsquo;t make it into consumers&rsquo; bank accounts. But then the money was unleashed. In the week ending February 17, the IRS sent out a record $74 billion in refunds. By the week ending February 24, refunds were down only 10%, or $15 billion, year-over-year. So most of the problem was resolved by the end of February.</p> <p><span style="text-decoration: underline;"><strong>That might explain part of the problem on the demand side, at least at the lower end of the scale. But it&rsquo;s hard to explain the plunge in prices at the luxury end. </strong></span>Also, <strong>these are wholesale prices</strong>. They don&rsquo;t react instantly to a brief consumer cash crunch caused by tax-refund delays, now resolved. Something else appears to be going on.</p> <p>The report, in attempting a forecast, cautioned:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>February&rsquo;s unusually soft showing makes pinpointing where used prices will go over the next few months a bit more challenging. However, given the slower than usual rollout of federal tax refunds, it&rsquo;s assumed prices will be somewhat stronger in March and April than originally anticipated.</p> </blockquote> <p>The Used Vehicle Index by <a href="https://publish.manheim.com/en/services/consulting/used-vehicle-value-index.html" target="_blank">Manheim</a>, the world&rsquo;s largest wholesale auto auction, didn&rsquo;t pick up a massive drop in used vehicle prices over the past few months, though it too is showing some&nbsp;weakness. The index edged down 0.2% in February. The report pointed out that, &ldquo;given a sharp decline in pricing in February of last year, the Manheim Index now shows a year-over-year gain of 1.1%.&rdquo;</p> <p><strong>The index has dropped in six of the past seven months (<a href="https://publish.manheim.com/content/dam/consulting/ManheimUsedVehicleValueIndex-LineGraph.png" target="_blank">chart</a>), but in small increments, and as it says, &ldquo;stability remains the watchword.&rdquo;</strong> It too acknowledge headwinds for the market, including the &ldquo;heavy new vehicle inventory and incentives,&rdquo; and &ldquo;a crazy tax refund season.&rdquo;</p> <h3><span style="text-decoration: underline;"><strong>Why are used vehicle wholesale prices important?</strong></span></h3> <p><em><strong>For one, they matter to lenders. Used vehicle wholesale prices determine the value of the collateral for $1.11 trillion in auto loans that have boomed on higher prices, higher unit sales, longer maturities (the average hit a new record of 66.5 months in Q4), and higher loan-to-value ratios (negative equity):</strong></em></p> <p><img class="alignnone size-full wp-image-31407" height="477" src="http://wolfstreet.com/wp-content/uploads/2017/03/US-auto-loans-2016-Q4.png" width="507" /></p> <p><strong><em>Dropping wholesale prices increase loan losses for lenders as recovery is lower. Declining wholesale values of lease turn-ins, if the trend persists, impacts how finance companies structure the lease terms, thus raising the costs for the customers and putting a damper on leasing activity.</em></strong></p> <p>All this puts <u><strong>pressure on new vehicle sales,</strong></u> further pushing automakers to pile on even larger incentives in order to move the units, grapple with inventories, and keep plants open. This works for a while &ndash; there&rsquo;s nothing like big-fat incentives to bring out reluctant buyers. But incentives, when everyone is doing them, are front-loading sales. This is ultimately self-defeating and gets very costly even as sales begin to decline. It was&nbsp;a contributor in the collapse of the industry during the Financial Crisis.</p> <p><strong>And there are well-established patterns of customers switching between new vehicles and late-model used vehicles.</strong> Large incentives by automakers put pressure on late-model used vehicles. In turn, falling prices on the used vehicle side cannibalize sales from the new vehicle side. In other words, they compete with each other, often on the same dealer lot. Especially if demand is lackluster despite the incentives, these patterns can trigger a downward spiral that is difficult to get out of.</p> <p>First oil &amp; gas, then construction, then new vehicle sales. <em>Read&hellip; &nbsp;<a href="http://wolfstreet.com/2017/03/15/how-auto-sales-are-getting-crushed-in-houston/">How Auto Sales Are Getting Crushed in Houston</a></em></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="260" height="171" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170322_car.jpg?1490222302" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/sound-bottom-falling-out-auto-industry#comments Auto auction Auto Sales Automotive industry Business Congress Economy Electric vehicles Federal Tax Government Government incentives for plug-in electric vehicles Internal Revenue Service Internal Revenue Service NADA National Association of Auto Dealers recovery Tax Taxation in the United States Transport Used Vehicle Thu, 23 Mar 2017 09:45:00 +0000 Tyler Durden 591476 at http://www.zerohedge.com Nunes Confirms There Was "Incidental Surveillance" Of Trump During Obama Administration, "Seems To Be Inappropriate" http://www.zerohedge.com/news/2017-03-22/nunes-trump-transition-members-and-possibly-trump-himself-were-under-surveillance-du <p><strong>Update</strong>: House Intel Chairman Nunes spoke to reporters when he left the briefing at The White House and had some more stunning things to say:</p> <ul> <li>*NUNES: BRIEFED PRESIDENT ON CONCERNS OVER INCIDENTAL COLLECTION</li> <li>*NUNES: `PRESIDENT NEEDS TO KNOW' THESE INTEL REPORTS EXIST</li> <li><strong>*NUNES: SOME OF WHAT I'VE SEEN SEEMS TO BE `INAPPROPRIATE'</strong></li> <li>*NUNES: TRUMP, OTHERS IN TRANSITION PUT INTO INTELLIGENCE REPORT</li> <li><strong>*NUNES: QUESTION IS IF TRUMP SHOULD BE IN THESE `NORMAL' REPORTS</strong></li> </ul> <p>And the punchline: there are "multiple FISA warrants outstanding against Trump" Nunes also told reporters:</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Wow - Nunes just said there are "multiple FISA warrants out there" involving Trump.</p> <p>— Tom Watson (@tomwatson) <a href="https://twitter.com/tomwatson/status/844628015845904385">March 22, 2017</a></p></blockquote> <p>*&nbsp; *&nbsp; *</p> <p>As we detailed earlier, it appears Trump may have been right, again.</p> <p>Two days after FBI director Comey shot down Trump's allegation that Trump was being wiretapped by president Obama before the election, it appears that president Trump may have been on to something because moments ago, the House Intelligence Chairman, Devin Nunes, told reporters that the U.S. intelligence community incidentally collected information on members of President Trump's transition team, possibly including Trump himself, and the information was "widely disseminated" in intelligence reports.</p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/nunes_0.jpg" width="500" height="271" /></p> <p>As <a href="http://bigstory.ap.org/8f45d6141e4e4cce86024af85841a9f7?utm_campaign=SocialFlow&amp;utm_source=Twitter&amp;utm_medium=AP">AP adds</a>, Nunes said that President Donald Trump's communications <strong>may have been "monitored" </strong>during the transition period as part of an "incidental collection."</p> <p>Nunes told a news conference Wednesday that the communications appear to be picked up through "incidental collection" and do not appear to be related to the ongoing FBI investigation into Trump associates' contacts with Russia. <strong>He says he believes the intelligence collections were done legally</strong>, although in light of the dramatic change in the plotline it may be prudent to reserve judgment on how "incidental" it was.</p> <p>"I recently confirmed that on numerous occasions, the intelligence community collected information on U.S. individuals involved in the Trump transition," Nunes told reporters. </p> <p><strong>"Details about U.S. persons involved in the incoming administration with little or no apparent foreign intelligence value were widely disseminated in intelligence community reports." </strong></p> <p>The information was "legally brought to him by sources who thought we should know it," Nunes said, though he provided little detail on the source. </p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">BREAKING!!! Rep Devin Nunes (Intel Cmte Chmn):<br />There was "Incidental collection" of <a href="https://twitter.com/realDonaldTrump">@realDonaldTrump</a> thru IC surveillance &lt;- BOMBSHELL</p> <p>— Eric Bolling (@ericbolling) <a href="https://twitter.com/ericbolling/status/844603089915129856">March 22, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>Nunes also said that "additional names" of Trump transition officials had been unmasked in the intelligence reports. <strong>He indicated that Trump's communications may have been swept up.&nbsp; </strong></p> <p>The House Intel Chair said he had viewed <strong>dozens of documents showing that the information had been incidentally collected. </strong>He said that he believes the information was legally collected.&nbsp; Nunes said that <strong>the intelligence has nothing to do with Russia and that the collection occurred after the presidential election.</strong></p> <p>Nunes said he briefed House Speaker Paul Ryan (R-Wis.) on the revelation and will inform the White House later today.&nbsp; Nunes' statement comes after he and other congressional leaders pushed back on Trump's claims that former President Obama had his "wires tapped" in Trump Tower ahead of the election.</p> <p><strong>Nunes said Wednesday that it was unclear whether the information incidentally collected originated in Trump Tower. </strong></p> <p>The revelation comes in the wake of the committee's explosive hearing on Monday, at which FBI Director James Comey confirmed that the bureau has been investigating Russia’s election hacking since July, which includes probing possible coordination between members of Trump’s presidential campaign and Moscow.</p> <p>The meeting represented the panel’s first open hearing on its investigation into Russia’s election meddling and also featured testimony from NSA Director Adm. Mike Rogers. </p> <p>Nunes says the communications of Trump associates were also picked up, but he did not name those associates. He says the monitoring mostly occurred in November, December and January. He added that he learned of the collection through "sources" but did not specify those source</p> <p>Politico adds that Nunes is going to the White House later Wednesday to brief the Trump administration on what he has learned, which he said came from "sources."</p> <blockquote class="twitter-tweet"><p dir="ltr" lang="en">Nunes says he is "bothered" by this. Won't say whether or not intel community spied on Trump et. al. But says he is "concerned."</p> <p>— David Corn (@DavidCornDC) <a href="https://twitter.com/DavidCornDC/status/844599302701940739">March 22, 2017</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>While there are no further details, we look forward to how the media narrative will change as a result of today's latest dramatic development. </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="1160" height="629" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/nunes_0.jpg?1490203989" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/nunes-trump-transition-members-and-possibly-trump-himself-were-under-surveillance-du#comments American people of German descent Climate change skepticism and denial Devin Nunes Donald Trump Donald Trump presidential campaign Donald Trump wiretapping claim Draft:Timeline of the Trump-Russia Scandal FBI Federal Bureau of Investigation Federal Bureau of Investigation House Intelligence James Comey Mike Pence Obama Administration Obama administration Politics Politics of the United States President Obama Testimony The Apprentice Trump Administration Trump Tower U.S. intelligence United States White House White House WWE Hall of Fame Thu, 23 Mar 2017 09:35:28 +0000 Tyler Durden 591431 at http://www.zerohedge.com Italy Falls Out Of Love With The Euro: Beppe Grillo Resurgent In The Polls http://www.zerohedge.com/news/2017-03-22/italy-falls-out-love-euro-beppe-grillo-resurgent-polls <p><a href="https://mishtalk.com/2017/03/22/italy-falls-out-of-love-with-euro-beppe-grillo-on-the-rise-recent-polls-for/"><em>Authored by Mike Shedlock via MishTalk.com,</em></a></p> <p>Recent polls for Italian politicians <strong>supporting </strong>the eurozone and EU <strong>have collapsed.</strong></p> <p>Pro-Europe polls are highly likely to get worse as a &nbsp;further splintering of Matteo Renzi&rsquo;s PD party takes place.</p> <p><strong>It is not out of question for Beppe Grillo&rsquo;s eurosceptic Five Star Movement (M5S) party to achieve an absolute majority in the next election</strong>. However, please note that 40% is the threshold for a &ldquo;majority&rdquo;.</p> <p>The Financial Times reports <a href="https://www.ft.com/content/91443ffe-028d-11e7-ace0-1ce02ef0def9" target="_blank">Italy is Falling Out of Love with Europe</a>.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Foreigners often underestimate Italy&rsquo;s ability to sidestep calamity. That said, the stakes are higher now than in 1992. Solutions may prove harder to find. The reason lies in the radically different EU and Mediterranean contexts in which Italy finds itself.</p> <p>&nbsp;</p> <p>Some of contemporary Italy&rsquo;s challenges appear similar to those of the early 1990s. <strong>The party system is once again in fragments. The ruling centre-left Democratic party (PD) split last month. The right is divided. The most popular opposition party is the anti-establishment Five Star Movement.</strong> Since November 2011 four prime ministers have taken office not because voters chose them, but because of a financial emergency, factional squabble, party coup and failed constitutional reform.</p> <p>&nbsp;</p> <p>Matteo Renzi, the former premier and PD leader, suffered a blow this month when it emerged that Tiziano Renzi, his father, and Luca Lotti, a close political ally, had been caught up in a judicial probe into suspected graft in public procurement.</p> <p>&nbsp;</p> <p><strong>The most disturbing comparison between 1992 and the present day concerns the Italian economy, which is projected this year to be the slowest-growing in the eurozone. </strong>Public debt is more than 132 percent of gross domestic product. Unemployment is almost 12 per cent; the youth jobless rate is over 37 percent.</p> <p>&nbsp;</p> <p>As a consequence, ever more Italian politicians question the merits of eurozone membership. So do Italian voters. In a Eurobarometer poll published in December, 47 percent called the euro &ldquo;a bad thing&rdquo; for their country and only 41 percent &ldquo;a good thing&rdquo;. This is the big difference with 25 years ago.</p> <p>&nbsp;</p> <p><strong>As long as the moderate left or right governs Italy, it may be possible to contain this disenchantment with the EU and the euro. But the PD&rsquo;s fissures are the latest sign that the party system is cracking under the strain. The Five Star Movement is waiting in the wings.</strong></p> </blockquote> <p><u><strong>PD Suicide</strong></u></p> <p>Via email, <em>Eurointelligence</em> comments on the costs of Matteo Renzi&rsquo;s PD&rsquo;s suicide mission.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>We have been saying it for a while &ndash; <strong>political parties that preoccupy themselves with their internal divisions are electorally doomed</strong>. It is happening to the Labour Party in the UK, and it is now happening to the Partito Democratico. This tendency is now being picked up by the polls, which show the Five Star Movement ahead of the PD by five points. We are now at the point where it becomes increasingly improbable for the PD to regain power after the next elections. They cannot do it on their own, and they do not have natural coalition partners to help them. Even a hypothetical alliance between Matteo Renzi and Silvio Berlusconi would not, on its own, meet the 40% majority threshold for a coalition, and there is no way the two parties would enter the election with a pre-arranged electoral pact in the first place.</p> <p>&nbsp;</p> <p><strong>The Five Star Movement is now only 6 points away from an absolute majority that would allow it to govern on its own</strong> &ndash; assuming that the present electoral law for the chamber of deputies forms the basis of a new electoral system for the Senate. If one adds up all the non-extremist parties (and let&rsquo;s count Berlusconi&rsquo;s Forza d&rsquo;Italia among them for the sake of argument), one would get to just over 40% &ndash; with the PD, Forza Italia, and the New Centre Right of foreign minister Angelino Alfano which only gets 2.8%.</p> <p>&nbsp;</p> <p>Worse for the PD, its support will fall even more after the split of the party becomes a reality &ndash; which it will before the elections. The poll puts the hypothetical support for PD dissidents at 7.1%, which would reduce the PD&rsquo;s overall support to under 20%. The new left, together with the old left, would have the support of close to 10%. All this shows that there can be only two election outcomes: either a fragmented parliament, with unstable and shifting coalitions, or a majority reign of the Five Star Movement. The Five Star Movement promises not to enter coalitions, and it will be interesting to see whether the party maintains that position after the elections.</p> <p>&nbsp;</p> <p><strong>On the issue that interests us the most &ndash; Italy&rsquo;s future in the EU, and in the eurozone in particular &ndash; the picture is even more grim.</strong> The only two parties that unconditionally support Italy&rsquo;s membership of the eurozone are the PD and the New Centre Right. Forza Italia is toying with the idea of a parallel currency, while the Five Star Movement has pledged a consultative referendum on Italy&rsquo;s future in the euro. While this referendum can legally not end Italy&rsquo;s membership in the eurozone, it would send a devastating signal to the outside world.</p> <p>&nbsp;</p> <p>The Five Star Movement has its own share of scandals &ndash; for example involving the new municipal government in Rome, and the party is in an internal state of war over the candidate for the mayoral elections in Genoa. But none of that seems to stick.</p> <p>&nbsp;</p> <p><strong>Our conclusion is that the Five Star Movement is rational to avoid alliances with other parties, as this approach is paying off electorally. With that strategy in place, they will either gain a sufficient majority (over 40%) at the next elections, or in the one after that.</strong></p> </blockquote> <p><u><strong>Italian Polls</strong></u></p> <p><em>Eurointelligence</em> referenced a specific Italian poll that has been since superseded.</p> <p>However, support for PD is clearly on the wane. Let&rsquo;s take a look at all of the recent <a href="https://en.wikipedia.org/wiki/Opinion_polling_for_the_next_Italian_general_election" target="_blank">Italian Election Polls</a>.</p> <p><a href="https://mishgea.files.wordpress.com/2017/03/italian-polls-3.png"><img class="alignnone size-large wp-image-44845" src="https://mishgea.files.wordpress.com/2017/03/italian-polls-3.png?w=529&amp;h=167" style="width: 599px; height: 189px;" /></a></p> <p>In only one poll since March 9 (clearly an outlier) did Matteo Renzi&rsquo;s PD party come in first place. Moreover, PD has not yet split for polling purposes but it will.</p> <p>I fail to see how M5s was &ldquo;6 points away from an absolute majority that would allow it to govern on its own&rdquo; as Eurointelligence states, but a coalition of eurosceptic parties totaling over 50% &nbsp;is easily at hand.</p> <p>Support for M5S (Five Star Movement) + Fi (Forza Italia) + LN (Lega Nord), all eurosceptic parties, totals 54.5%in the most recent poll.</p> <p>Forza Italia is former prime minister Silvio Berlusconi&rsquo;s &nbsp;party.</p> <p>On March 9, Bloomberg reported &nbsp;<span class="lede-text-only__highlight"><a href="https://www.bloomberg.com/news/articles/2017-03-09/enter-berlusconi-a-man-a-ban-and-his-plan-to-restore-the-lira" target="_blank">Enter Berlusconi: A Man, a Ban, and His Plan to Restore the Lira</a>.</span></p> <p><strong>If elections&nbsp;were held today, eurosceptic parties would easily hit not only a 40% threshold but a 50% threshold as well.</strong></p> <p>Whether eurosceptic could agree to form a coalition is another matter, but I suspect they would, especially if the alternative was a minority government led by PD.</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="276" height="161" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170322_grillo.jpg?1490236256" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/italy-falls-out-love-euro-beppe-grillo-resurgent-polls#comments Democratic Party Democratic Party European Union Euroscepticism Eurozone Fail Five Star Movement Forza Italia Forza Italia Gross Domestic Product Italy Italy Labour Party Matteo Renzi Mediterranean None PD party Politics Politics of Europe Politics of Italy Prime Ministers of Italy Reality Renzi Cabinet Senate Silvio Berlusconi Silvio Berlusconi Silvio Berlusconi’s party Star Movement Unemployment Withdrawal from the European Union Thu, 23 Mar 2017 09:00:00 +0000 Tyler Durden 591497 at http://www.zerohedge.com Art Bubble Pops As Sales Crash To Lowest Level Since 'Great Recession' http://www.zerohedge.com/news/2017-03-22/art-bubble-pops-sales-crash-lowest-point-great-recession <p>Just as Yellen &amp; Co. has finally decided that 'Everything is Awesome' and started raising interest rates (the timing of which we're almost certain was in no way influenced by the conclusion of the recent election cycle), signs continue to mount that global economies are not as healthy as the Fed suddenly believes them to be.&nbsp; In fact, over just the past couple of days we've highlighted a litany of negative economic data points including <a href="http://www.zerohedge.com/news/2017-03-19/bank-loan-creation-crashes-fastest-pace-financial-crisis">crashing bank loan creation</a>, <a href="http://www.zerohedge.com/news/2017-02-16/auto-bubble-burst-begins-subprime-delinquencies-soar-2009-levels">surging auto loan delinquencies</a> and continuous <a href="http://www.zerohedge.com/news/2017-03-22/retail-nightmare-just-wont-end-sears-crashes-going-concern-warning-payless-file-bank">deterioration of the retail sector</a>, just to name a few.</p> <p>And while the mega wealthy folks of the world are typically somewhat immune from the economic cycle, even they are suddenly taking a breather from purchases of multi-million dollar works of fine art which have collapsed to levels not recorded since 2009.&nbsp; Per <a href="https://www.bloomberg.com/news/articles/2017-03-22/global-art-sales-fall-11-to-lowest-point-since-financial-crisis">Bloomberg</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Sales of art and antiques dropped 11 percent to $56.6 billion</strong>, according to a report released on Wednesday by UBS Group AG and Art Basel. The decline, on top of a 7 percent slide in 2015, <strong>wipes out the gains seen in 2013 and 2014, when sales reached an all-time high of $68.2 billion.</strong></p> <p>&nbsp;</p> <p><strong>“It was quite a challenging year for the art market,”</strong> Clare McAndrew, founder of Arts Economics that prepared the report, said in a telephone interview.</p> <p>&nbsp;</p> <p>Her outlook for 2017 is cautious, with sellers holding back as economic and geopolitical uncertainty continues in many countries. Buyers, on the other hand, may view art and antiques as “a relative safe haven amidst volatility elsewhere,” increasing prices for the works that appear on the market, according to the report.</p> </blockquote> <p><a href="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/03/22/2017.03.22%20-%20Art%201.JPG"><img src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017/03/22/2017.03.22%20-%20Art%201_0.JPG" alt="Art" width="600" height="284" /></a></p> <p>&nbsp;</p> <p>This follows a <a href="http://www.zerohedge.com/news/2017-03-01/art-bubble-bursting-gauguin-painting-collapses-74-22-million">note we published</a> a few weeks ago noting that Russian billionaire Dmitry Rybolovlev had<strong> taken a 74% bath on a Paul Gauguin piece he purchased in 2008 for $85 million.</strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Russian billionaire Dmitry Rybolovlev paid €54 million or $85 million for a landscape by Paul Gauguin in a private transaction in June 2008. Yesterday, <strong>he incurred a whopping 74% loss on his store of value "investment" as reported by Bloomberg:</strong></p> <p>&nbsp;</p> <p>Gauguin’s 1892 landscape “Te Fare (La Maison)" fetched 20.3 million pounds ($25 million), including commission, at Tuesday evening’s sale of Impressionist and modern art at Christie’s in London. Rybolovlev will net about $22 million based on the hammer price. The auction house had estimated the value at $15 million to $22.4 million. The buyer was a client of Rebecca Wei, president of Christie’s Asia.</p> <p>&nbsp;</p> <p>The Gauguin was one of four Rybolovlev pieces offered for sale on Tuesday. Another work, a Mark Rothko painting, will be auctioned March 7.</p> </blockquote> <p>Of course, not all fine art is created equal...here were the biggest losers of 2016:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <ul> <li>Auction sales declined 26 percent to $22.1 billion, according to the report, released to coincide with the opening of Art Basel Hong Kong.</li> <li>Sales of <strong>postwar and contemporary works at auction fell 18 percent</strong> to $5.6 billion; <strong>modern art was down 43 percent</strong> at $2.6 billion; the Impressionist category declined 31 percent to $1.3 billion.</li> <li>The high end of the auction market -- where prices for artworks exceed $1 million -- fell 34 percent. <strong>Trophies priced at more than $10 million saw the biggest decline, at 53 percent.</strong></li> <li>Industry leaders Sotheby’s and Christie’s lost market share, together accounting for 38 percent of the auction sales, down from 42 percent in 2015.</li> </ul> </blockquote> <p><iframe src="https://www.bloomberg.com/api/embed/iframe?id=1c1071d4-f095-4b43-a944-f996d37a3af6" width="600" height="337" frameborder="0">&amp;amp;lt;br&amp;amp;gt;</iframe></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="694" height="442" alt="" src="http://www.zerohedge.com/sites/default/files/images/user230519/imageroot/2017.03.22%20-%20Art%20tease.JPG?1490198646" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/art-bubble-pops-sales-crash-lowest-point-great-recession#comments Art valuation AS Monaco FC Auction Auction houses Auctions Business Business Christie's Dmitry Rybolovlev Economy Hong Kong Market Share Paul Gauguin Recession Sotheby's US Federal Reserve Visual arts Volatility Thu, 23 Mar 2017 08:15:00 +0000 Tyler Durden 591423 at http://www.zerohedge.com 9 Years Later... Greece Is Still In A Debt Crisis! http://www.zerohedge.com/news/2017-03-22/9-years-later-greece-still-debt-crisis <p><a href="https://www.sovereignman.com/trends/nine-years-later-greece-is-still-in-a-debt-crisis-21202/"><em>Authored by Simon Black via SovereignMan.com,</em></a></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_greeks.jpg"><img height="313" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_greeks.jpg" width="600" /></a></p> <p><em><strong>Sometimes you have to marvel at the absurdity of the financial universe in which we live.</strong></em></p> <p><span style="text-decoration: underline;"><strong>On one side of the Atlantic, we have the United States of America,</strong></span> which triggered yet another debt ceiling disaster last Thursday when the US government&rsquo;s maximum allowable debt reset to just over $20 trillion.</p> <p>Of course, the US national debt is pretty much already at $20 trillion.</p> <p><em>(That&rsquo;s roughly $166,000 per taxpayer in the Land of the Free.)</em></p> <p>This means that Uncle Sam is legally prohibited from &lsquo;officially&rsquo; borrowing any more money.</p> <p>But far be it from the US government to start living within its means. Sacrilege!</p> <p>These guys have zero chance of making ends meet without going into debt.</p> <p><em><strong>Just last year, according to the government&rsquo;s own financial report, their annual net loss totaled $1 TRILLION, and the national debt increased by $1.4 trillion.</strong></em></p> <p><em><strong>And that was in a relatively stable year. There was no major war or financial crisis to fight. It was just business as usual.</strong></em></p> <p>This year isn&rsquo;t going to be any different.</p> <p>So, cut off from their normal debt supply (the bond market), the Treasury Department is resorting to what they call &ldquo;extraordinary measures.&rdquo;</p> <p>They&rsquo;re basically pillaging government employee retirement funds, and will continue to do so until Congress raises the debt ceiling.</p> <p><strong>It&rsquo;s a repeat of what happened in 2015. And 2013. And 2011.</strong></p> <p>Pretty amazing to consider that the &ldquo;richest&rdquo; country in the world has to plunder retirement funds in order to keep the lights on.</p> <p>Former US Treasury Secretary Larry Summers said it perfectly when he quipped &ldquo;How long can the world&rsquo;s biggest borrower remain the world&rsquo;s biggest power?&rdquo;</p> <p><span style="text-decoration: underline;"><strong>Then, of course, on the other side of the Atlantic, we have Greece, which is now in its NINTH YEAR of a major debt crisis.</strong></span></p> <p>Incredible.</p> <p><strong>Greece has had nine different governments since 2009</strong>. At least thirteen austerity measures. Multiple bailouts. Severe capital controls. And a full-out debt restructuring in which creditors accepted a 50% loss.</p> <p>Yet despite all these measures GREECE IS STILL IN A DEBT CRISIS.</p> <p>Right now, in fact, Greece is careening towards another major chapter in its never-ending debt drama.</p> <p><strong>Just like the United States, the Greek government is set to run out of money (yet again) in a few months and is in need of a fresh bailout from the IMF and EU.</strong></p> <p><strong><em>(The EU is code for &ldquo;Germany&rdquo;&hellip;)</em></strong></p> <p>Without another bailout, Greece will go bust in July&ndash; this is basic arithmetic, not some wild theory.</p> <p>And this matters.</p> <p>If Greece defaults, everyone dumb enough to have loaned them money will take a BIG hit.</p> <p>This includes a multitude of banks across Germany, Austria, France, and the rest of Europe.</p> <p>Many of those banks already have extremely low levels of capital and simply cannot afford a major loss.</p> <p><em>(Last year, for example, the IMF specifically singled out Germany&rsquo;s Deutsche Bank as being the top contributor to systemic risk in the global financial system.)</em></p> <p><strong>So a Greek default poses as major risk to a number of those banks.</strong></p> <p>More importantly, due to the interconnectedness of the financial system, a Greek default poses a major risk to anyone with exposure to those banks.</p> <p>Think about it like this:<em><strong> if Greece defaults and Bank A goes down, then Bank A will no longer be able to meet its obligations to Bank B. Bank B will suffer a loss as well.</strong></em></p> <p>A single event can set off a chain reaction, what&rsquo;s called &lsquo;contagion&rsquo; in finance.</p> <p><strong>And it&rsquo;s possible that Greece could be that event.</strong></p> <p>This is what European officials have been so desperate to prevent for the last nine years, and why they&rsquo;ve always come to the rescue with a bailout.</p> <p>It has nothing to do with community or generosity. They&rsquo;re hopelessly trying to prevent another 2008-style meltdown of the financial system.</p> <p>But their measures have limits.</p> <p><em><strong>How much longer do Greek citizens accept being vassals of Germany, suffering through debilitating capital controls and austerity measures?</strong></em></p> <p><em><strong>How much longer do German taxpayers continue forking over their hard-earned wages to bail out Greek retirees?</strong></em></p> <p><u><strong>After all, they&rsquo;ve spent nine years trying to &lsquo;fix&rsquo; Greece, and the situation has only become worse.</strong></u></p> <p>For a continent that has been at war with itself for 10 centuries and only managed to play nice for the last 30 or so years, it&rsquo;s foolish to expect these bailouts to last forever.</p> <p><strong>And whether it&rsquo;s this July or some date in the future, Greece could end up being the catalyst which sets off a chain reaction on both sides of the Atlantic</strong>.</p> <p><a href="https://www.sovereignman.com/trends/nine-years-later-greece-is-still-in-a-debt-crisis-21202/"><u><em><strong>Do <span class="underline_text">you</span> have a Plan B?</strong></em></u></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="600" height="313" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170322_greeks.jpg?1490235564" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/9-years-later-greece-still-debt-crisis#comments Austerity B+ Bailout Bond Business Congress Creditors Debt Ceiling default Department of the Treasury Deutsche Bank Economic history of Greece Economy European Union Eurozone crisis Financial crises Financial crisis of 2007–2008 Fiscal policy France Germany Government debt Greece Greek government Greek government-debt crisis International Monetary Fund International Monetary Fund Larry Summers Meltdown National Debt Stock market crashes Treasury Department U.S. Treasury US government Thu, 23 Mar 2017 07:30:00 +0000 Tyler Durden 591496 at http://www.zerohedge.com Will Thursday's Final TLTRO Finally Spark Carry Trades? http://www.zerohedge.com/news/2017-03-22/will-thursdaythe-tltro-spark-carry-trades <p><em>By Nick Kounis of <a href="https://insights.abnamro.nl/en/2017/03/euro-rates-watch-will-the-tltro-spark-carry-trades/">ABN Amro</a></em></p> <p><strong>Euro Rates Watch – Will the TLTRO spark carry trades?</strong><em><br /></em></p> <ul> <li>The last of the ECB’s TLTRO-II operations is expected to have a big take up, with the market expecting EUR 125bn, and some forecasts as high as EUR 300bn</li> <li>From a rates perspective, what matters is whether these funds will trigger flows into the bond or swap markets as banks set up carry trades</li> <li>Carry trades have certainly looked attractive and currently there is a possible spread of around 80bp between the rate on the TLTRO and similar maturity peripheral bonds</li> <li>However, there is little evidence that banks have used TLTRO-II funds for carry trades over the last few months</li> <li>Eurozone bank government bond holdings have actually fallen sharply since the first TLTRO-II…</li> <li>…while a very small proportion of banks said they would use the funds to buy assets in the ECB’s Bank Lending Survey</li> <li>Finally, there was no discernible impact on government bond curves around the time of the TLTROs…</li> <li>….and only a temporary impact on swap spreads in one of the three operations</li> <li>Overall, we doubt the last of the TLTRO’s will have a major lasting impact on bond or swap markets</li> </ul> <p><strong>The impact of TLTRO-II on the eurozone rates market</strong></p> <p>On Thursday, the ECB will hold its fourth tender under the TLTRO-II (Targeted Long-Term Refinancing Operations) programme. A large take-up is expected. A poll published by Reuters had a&nbsp; median forecast of EUR 125bn net borrowing (EUR 141bn gross given banks will repay EUR 16.74bn), with estimates as high as EUR 300bn. From a rates perspective, what matters is whether these funds will trigger flows into the bond or swap markets as banks set up carry trades. Certainly, carry trades can be attractive. At the time of past operations there has been a possible spread of around 40bp between the rate on the TLTRO and similar maturity peripheral bonds. Currently this spread has risen to around 80bp, given the rise in peripheral yields. In this note we assess how likely it is that we will see a major impact on bond and swap markets by looking at the impact of the first three tenders, which saw a cumulative net take up of EUR 138bn. We first take a look at what banks have said about the uses of TLTRO funds in the ECB’s Bank Lending Survey. We go on to look at bank bond holdings. Finally, we analyse price movements in the bond and swap markets around the time of the TLTROs.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%201_0.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%201_0_0.jpg" width="500" height="197" /></a></p> <p><strong>Only a very small proportion of banks say they used TLTRO to buy assets </strong></p> <p>The ECB’s Euro area Bank Lending Survey of January 2017 (see here) asked 134 banks about their participation in past TLTRO-II operations and the upcoming tender. In addition, the banks were questioned on their planned use of the funds (see charts below). Of the banks, 37% said they participated in the third TLTRO-II operation, which was lower than in the second tender (see graphs below). Meanwhile, 26% said they intended to participate in the upcoming TLTRO-II tender, while 42% was undecided and 32% indicated that they did not plan to participate. It is likely that more banks now intend to participate given it is final tender and market expectations of interest rate hikes have risen (see appendix). For the use of past TLTRO-II liquidity, banks revealed that they would use the cheap liquidity for granting loans (60%), to refinance other funding sources (24%), while only a very modest proportion said they intended to buy assets (9%). For tomorrow’s tender, a slightly higher proportion of the banks said they would engage in carry trades (13%).</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%202.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%202_0.jpg" width="500" height="185" /></a></p> <p><strong>Eurozone government bond holdings have fallen</strong></p> <p>The banks’ responses in the ECB survey appear to be corroborated in data on eurozone banks’ non-MFI bond holdings (see charts below). Eurozone banks’ bond holdings fell significantly between June of last year and&nbsp; January of this year. Total bond holdings fell by EUR 153bn (-9.6%), while domestic bond holdings fell by EUR 124bn (-10.6%). The large absolute falls were seen in Spain and Italy, followed by France and Germany. If banks had&nbsp; initiated carry trades by using TLTRO-II funds to invest in bonds, their bond holdings would have been expected to rise. Rather, a large buyer – the Eurosystem central banks – seems to have crowded them out of the market.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%203.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%203_0.jpg" width="500" height="194" /></a></p> <p><strong>Little discernible impact on bond or swap markets</strong></p> <p>Finally, we find no major or sustained impact on bo nd or swap markets in the day surrounding the TLTRO-II operations. In the charts below, T is the TLRO-II settlement day for the various operations, and we show movements in swap and bond markets 5 days before and 5 days after. Carry trades would be expected to induce steepening as they would support the segment around 4-years. The left hand chart shows 5s10s ASW swap spreads. There was only temporary steepening around the time of the first TLTRO-II in June, while there was no visible impact in the September and December editions. In the run-up to this month’s TLTRO-II, we do see some steepening, as there appears to be some front running. But it is too early to say it trend will be sustained, given the experience of the swap market behaviour in the first three tenders. The right hand chart shows the average 4s8s spreads of Italian and Spanish government bonds. There is little evidence of bull steepening around any of the operations.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%204.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/03/20/tltro%204_0.jpg" width="500" height="193" /></a></p> <p><strong>No major sustained impact expected from last TLTRO-II</strong></p> <p>The last of the TLTRO-II operations will probably see a large net take up of EUR 100bn or more. As discussed above, it would seem very attractive to invest TLTRO proceeds into especially peripheral government bonds&nbsp; or to conduct carry trades by entering receiver swaps of similar maturities to the tender. However, there is little evidence that banks have done so up until now, even though it has always been relatively attractive. One&nbsp; potential reason for this is that (especially peripheral) bank holdings of government bonds were already very large at the start of the TLTRO-II operations. They may feel uncomfortable adding to those holdings. Another reason is that by investing in assets, banks increase their balance sheets. This could be accompanied by higher regulatory costs which would make carry trades less profitable. Furthermore, there have been initiatives in Europe to risk-weight banks’ domestic government bond holdings. At the same time, investors have recently become more concerned about the fundamentals of certain sovereigns in the periphery,&nbsp; especially once QE ends. Overall, we&nbsp; doubt the last of the TLTRO’s will have a major lasting impact on bond or swap markets</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="1452" height="573" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/IMG_6133.JPG?1490256256" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/will-thursdaythe-tltro-spark-carry-trades#comments 5s10s Bank Lending Survey Bond Bond Business Central Banks Central banks Currency Economy Economy of the European Union Euro European Central Bank European Union Eurozone Eurozone Eurozone government Financial market France Front Running Germany Italian and Spanish government Italy Open market operation Policy reactions to the Eurozone crisis Reuters Sovereigns Swap Thu, 23 Mar 2017 06:43:42 +0000 Tyler Durden 591499 at http://www.zerohedge.com Economics Of The Standoff Between Turkey And The Netherlands http://www.zerohedge.com/news/2017-03-22/economics-standoff-between-turkey-and-netherlands <p><em><a href="http://www.strategic-culture.org/news/2017/03/22/economics-of-the-standoff-between-turkey-and-the-netherlands.html">Authored by Altay Atli via The Strategic Culture Foundation blog,</a></em></p> <p><em><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_turks.jpg"><img height="339" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_turks.jpg" width="600" /></a></em></p> <p><strong>As the diplomatic squabble between Turkey and the Netherlands continues to fester,</strong> concerns are raised about whether &mdash; and to what extent &mdash; the tensions will harm bilateral relations, particularly in economics where <strong>the two countries have robust trade and investment connections.</strong></p> <p><strong>For Turkey, the Netherlands offers a large and expanding export market. </strong>Trade between the two countries has roots in the 17th century when the Ottomans exported wool and cotton (later tobacco as well) to the Netherlands and imported clothes and linen in return. Commerce between the two countries remained strong into modern times; in 2016 the bilateral trade volume was US$6.6 billion.</p> <p><strong>The Netherlands is the 10th largest export destination for Turkey,</strong> and perhaps more importantly from the Turkish perspective, it is also a fast-growing market. Last year Turkish exports to the Dutch market amounted to $3.6 billion, against $3 billion in imports. And while the annual increase in imports was 3.4%, exports expanded much faster, at 13.8%. For the Turkish economy, which is suffering an acute current-account deficit, the increasing trade surplus with the Dutch is a precious commodity.</p> <div> <div><strong>On the other side of the equation, Turkey is and has always been a favored destination for Dutch investment.</strong> A process that started in 1930 when the Dutch company Philips set up shop in the newly established Republic of Turkey has reached new levels since then, making the Netherlands by far the largest source of foreign direct investment in Turkey today. According to data by the Turkish Central Bank, Dutch investment stock in Turkey was $22 billion in 2016, compared with $11.2 billion in US investments in second place, and $9.8 billion from Austria in third place.</div> </div> <p><strong>Turkey is home to 2,700 companies funded by Dutch capital.</strong> This figure includes those transnational companies registered in the Netherlands for legal and tax-related purposes. This sizeable Dutch involvement in the Turkish economy benefits both sides. For Dutch multinationals such as Unilever, ING Bank, Philips, Perfetti, Royal Dutch Shell and Philip Morris, Turkey is not only a favorable production base but also a lucrative market and a trading and logistics hub for access to the Middle East and North Africa, Balkans, Caucasus and Central Asia. More Dutch investment is set to come to Turkey, such as the recent purchase by Vitol Group of the Turkey-based fuel products distribution company Petrolofisi for $1.47 billion. Investment needs a stable political climate, and the diplomatic spat between Turkey and the Netherlands doesn&rsquo;t help.</p> <p>It is also worth nothing that while the amount of Turkish investment in the Netherlands is considerably smaller, <strong>there are several large Turkish firms that have set up subsidiaries enabling access to the larger EU market.</strong></p> <p><strong>For the past week, Dutch pundits have been commenting that Turkey is more dependent on the Netherlands, so possible sanctions imposed by Ankara would only mean &ldquo;shooting themselves in the foot.&rdquo; </strong>Turkish authorities have imposed political sanctions over the Dutch government&rsquo;s refusal to allow Turkish ministers to meet with members of the Turkish diaspora there, including halting high-level political discussions between the two countries and the closing of Turkish airspace to Dutch diplomats. But Ankara has carefully ruled out economic sanctions. Turkey&rsquo;s economics minister, Nihat Zeybekçi said: &ldquo;If we take these steps, both sides would be hurt.&rdquo; Ömer Çelik, minister of EU affairs said the Dutch business community, which is &ldquo;investing in Turkey, doing commerce and generating employment&rdquo; is &ldquo;certainly not a part of this crisis,&rdquo; and &ldquo;Dutch investment in Turkey is by no means under risk&rdquo;.</p> <p><strong>Economic sanctions between Turkey and the Netherlands don&rsquo;t seem likely at the moment, but longer-term threats remain.</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>First, even if no sanctions are imposed, the significant<strong> loss of confidence caused by recent events will take a toll on bilateral economic relations</strong> for some time.</p> <p>&nbsp;</p> <p>Second,<strong> the sizeable Turkish diaspora in the Netherlands, as well as the relatively smaller Dutch community living in Turkey, will face uncertainty</strong>, and this will have an<strong> economic impact </strong>too. An estimated 400,000 Turks live in the Netherlands, according to a diaspora association, and there are 25,000 businesses with Turkish owners, most of them smaller enterprises. Many of these companies are doing business with Turkey, and they are negatively affected by the current dispute between the two governments. So is the much smaller Dutch community in Turkey. But it is equally active in the economy, especially in the tourism sector. Declining tourist numbers will hurt Turkish and Dutch operators alike, and it might take some time to recover to pre-crisis levels of business.</p> <p>&nbsp;</p> <p>Third, the diplomatic spat is likely to have a <strong>negative effect on efforts to revise the Turkish-EU Customs Union.</strong> The union, which took effect in 1996, is outdated, failing to catch up with the requirements of today&rsquo;s global trade. Ankara and Brussels had begun talks to improve the deal, but the current circumstance&nbsp;is likely to overshadow attempts based on economic rationality.</p> </blockquote> <p>This week Turkish football team Be?ikta? played the Greek side Olympiakos in the European cup. The Turks won 4-1 helped by two goals from Ryan Babel, the Amsterdam-born Dutch striker. <strong><em>Turkey and the Netherlands have links that are closer than many realize, and it will benefit both to keep them intact.</em></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="627" height="354" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170322_turks.jpg?1490235391" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/economics-standoff-between-turkey-and-netherlands#comments Balkans Business Central Asia Dutch government East Africa Eastern Mediterranean European Union Foreign relations of Turkey Geography of Europe International relations Member states of the Union for the Mediterranean Middle East Middle East Netherlands Netherlands Netherlands–Turkey relations North Africa Politics Republics Strategic Culture Foundation Turkey Turkey Turkish central bank Turkish-EU Customs Union World Thu, 23 Mar 2017 06:00:00 +0000 Tyler Durden 591495 at http://www.zerohedge.com Hysteria on the Left Over Russia Has Reached a Fevered Pitch http://www.zerohedge.com/news/2017-03-23/hysteria-left-over-russia-has-reached-fevered-pitch <p>We first need to remember where this all started -- nearly a hundred years ago Trotsky was exiled from Russia; he packed his bags and headed for Mexico to start what is known today as the neocon movement. Their stated goal was to spread a brand of government via military means -- remaining in a state of revolution at all times. They are, essentially, communists masquerading as capitalists and they co-opted the republican party. Today, the children of the original neocons, like Bill Kristol, have hard-ons for Russia -- because it's in their blood. They can't help themselves. </p> <p>Now the left were always fans of the Soviet Union -- because communism appealed to them. If you recall, Ted Kennedy actually reached out to the Russians in the 80's to broker a deal with them in exchange for their help in undermining Reagan. It failed and Reagan ended up being the best leader since JFK.</p> <p>But ever since communism ended in Russia, the left have been very sore with them and have merged ideologies with the neocons to foment strife with them. Events transpiring in the Ukraine was the first excuse for these sleeper cells in our government to activate -- trying to lure Putin into an escalation. When Putin went into Syria, to defend his only deep water port in the Mediterranean and take out ISIS, who we armed and permitted to run wild about the region, we had Turkey shoot down their fighter jet followed by Secretary Kerry requesting that we send troops into Syria to support the 'rebels' -- who were/are terrorists. </p> <p>When John Podesta's emails were released, it was a massive embarrassment to the DNC and Hillary Clinton. Rumors of a child-pedo ring were running rampant and weird things started to happen -- such as the death of Seth Rich. Following Trump's victory, this narrative that Russia somehow hacked Podesta's emails and then delivered them to Wikileaks was energized to the tenth degree by the mercenary media, neocons, and the left. They've been using this feeble and easy to disprove narrative to undermine President Trump -- because he represents everything the establishment hates. They're impugning the honor and integrity of a military giant, one with advanced nuclear weaponry -- because their childish behavior demands it.</p> <p>Would you want your son drafted into a war to fight and die in Moscow because John "I don't need pizza now" Podesta's email box was hacked? Get the fuck out of here with these lunatics. </p> <p>I clipped this from the Russian 'echo-chamber' Infowars -- who did a good job documenting some of the more outlandish statements made by the left -- regarding Russia. These are not the actions and words of stable people.</p> <p><iframe width="560" height="315" src="https://www.youtube.com/embed/J3L_M4K9VTw" frameborder="0" allowfullscreen></iframe></p> <p><strong>Content originally generated at <a href="https://ibankcoin.com/">iBankCoin.com</a></strong></p> http://www.zerohedge.com/news/2017-03-23/hysteria-left-over-russia-has-reached-fevered-pitch#comments Conservatism Conservatism in the United Kingdom Conservatism in the United States Espionage Government John Podesta Mediterranean Mexico Neocons Neoconservatism Politics Politics Republican Party RT Television Turkey Ukraine WikiLeaks Thu, 23 Mar 2017 05:46:52 +0000 The_Real_Fly 591520 at http://www.zerohedge.com Davos For Democrats: DNC Mega Donors Meet At Mandarin Oriental Hotel To Plot "The Resistance" http://www.zerohedge.com/news/2017-03-22/davos-democrats-dnc-mega-donors-meet-mandarin-oriental-hotel-plot-resistance <p><a href="https://libertyblitzkrieg.com/2017/03/22/davos-for-democrats-dnc-mega-donors-meet-at-mandarin-oriental-hotel-to-plot-the-resistance/"><em>Authored by Mike Krieger via Liberty Blitzkrieg blog,</em></a></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_dems.jpg"><em><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/03/21/20170322_dems.jpg" style="width: 348px; height: 131px;" /></em></a></p> <p><em>The Daily Beast</em> just published an article previewing what should be referred to from this day forth as <strong>Davos for Democrats</strong>; a big-money infused orgy of wealthy donors telling their political puppets what to do as they&nbsp;mingle&nbsp;at one of the most luxurious&nbsp;hotel chains in the world.</p> <p><strong>Clearly learning absolutely zero lessons from their recent election pummeling</strong>, the Democratic Party is simply doubling down on its hopelessly failed strategy. Namely, a focus on <strong>more cash, even more donor influence and an absence of any new or interesting ideas that could actually get frustrated and struggling American&nbsp;voters excited</strong>. The post referenced below reads like something out of <em>The Onion</em> and would be downright hilarious if it wasn&rsquo;t so pathetic and deranged.</p> <p>From the article,&nbsp;<a href="http://www.thedailybeast.com/articles/2017/03/21/democratic-donors-gather-in-dnc-to-plot-the-resistance.html" target="_blank">Democratic Donors Gather in D.C. to Plot the Resistance</a>:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>The&nbsp;Democratic Party&rsquo;s top officials will meet with some of their wealthiest donors in Washington, D.C., this week to plot the Trump resistance, according to documents obtained by The Daily Beast.</em></p> <p>&nbsp;</p> <p><em>The chairs of the Democratic National Committee and the party&rsquo;s&nbsp;House and Senate&nbsp;campaign arms will huddle with activists, operatives, and deep-pocketed Democratic financiers at a biannual conference hosted by the Democracy Alliance, a leading left-wing donor collaborative at Washington&rsquo;s ritzy Mandarin Oriental hotel.</em><span id="more-43091"> </span></p> <p>&nbsp;</p> <p><em>They will discuss strategy for immediate opposition to President Donald Trump&rsquo;s policies, begin laying the groundwork for Democratic campaigns in next year&rsquo;s midterm elections, strategize future efforts for congressional redistricting, and promote an agenda focused on the state level, where Democrats still retain some power and hope to build a model for national progressive victories. And perhaps most importantly, map out how to fully fund their opposition to all things Trump.</em></p> <p>&nbsp;</p> <p><em>The Alliance brings together high-dollar liberal donors&mdash;individuals, labor unions, and charitable foundations&mdash;that pledge to give at least $200,000 annually to a suite of left-wing organizations. Through its &ldquo;partners,&rdquo; as the donors are known internally, <strong>the Alliance in 2015&nbsp;<a href="http://freebeacon.com/issues/worried-big-labor-democracy-alliance-scrambles-expand-fundraising/" target="_blank">raised $75 million</a>&nbsp;for its supported organizations, an annual record for the group.</strong></em></p> </blockquote> <p>A lot of good that $75 mill did. Encouraging to see the solution is just throw more donor money at the problem.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>Those include the Center for American Progress, a liberal policy shop that has turned its 501(c)(4) arm into&nbsp;<a href="https://www.buzzfeed.com/rubycramer/democratic-war-room-expands-with-plans-to-scrutinize-hundred" target="_blank">an anti-Trump &ldquo;war room,</a>&rdquo; and Media Matters for America, a media-focused rapid response group that has&nbsp;<a href="http://freebeacon.com/politics/media-matters-says-secretly-working-facebook-fight-fake-news/" target="_blank">recently retooled</a>&nbsp;its efforts toward &ldquo;fake news&rdquo; and pro-Trump disinformation.</em></p> </blockquote> <p>Dumb and Dumber.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>And on Friday, the Alliance will host what it describes as &ldquo;the first in <strong>a regular series of off-the-record dialogues between progressive political donors and Democratic Party officials about the future.&rdquo;</strong></em></p> </blockquote> <p>A regular series of off-the-record meetings between <strong>donors</strong> and Democratic officials. You can&rsquo;t make this stuff up.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>Donors in attendance will include Michael Vachon, a top aide to billionaire hedge fund manager George Soros;</strong> health care technology mogul Paul Egerman; Dallas philanthropist Naomi Aberly; Susan Sandler, the daughter of subprime mortgage pioneer Herb Sandler; and Ian Simmons, the husband of Hyatt hotel fortune heiress Liesel Pritzker Simmons.</em></p> <p>&nbsp;</p> <p><em>The Alliance&rsquo;s donors have recently had to step up their financial commitments as the group retools its mission from policymaking by way of an allied White House to opposition to Republican dominance at all levels of government.</em></p> <p>&nbsp;</p> <p><em>In addition to their annual contribution thresholds, Alliance partners must chip in to support the donor collaborative&rsquo;s operations. <strong>Partner dues increased by between $5,000 and $10,000 this year to support the Alliance&rsquo;s revamped mission</strong>, BuzzFeed News&nbsp;<a href="https://www.buzzfeed.com/rubycramer/democracy-alliance-raises-member-fees-and-retools-to-fight-t?utm_term=.jtrrpQEGJv#.nfO7gpmoQw" target="_blank">reported in January</a>.</em></p> </blockquote> <p>Long on money, short on ideas. That&rsquo;s the Demcoratic Party for you.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>That dovetails with recent Alliance strategy, which has focused on reversing dramatic Democratic losses at the state level ahead of the 2020 census and redistricting process. <strong>The Alliance considers a Democrat-friendly round of redistricting essential to future progressive policy gains.</strong></em></p> </blockquote> <p>A focus on redistricting. Again, no ideas.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>Another event, featuring Planned Parenthood president Cecile Richards, will examine the &ldquo;opportunity, spurred by the enormous energy of ordinary people taking grassroots action, to oppose the Trump agenda and <strong>how to channel this energy for a change </strong>in the nation&rsquo;s political direction, starting with building back power and winning critical state elections in 2017 and 2018.&rdquo;</em></p> </blockquote> <p>This article is just so telling about the priorities of the donor-controlled Democratic Party. They remain&nbsp;focused on money, redistricting and &ldquo;channeling energy&rdquo; (i.e. manipulating voters), as opposed to ideas. The party has nothing to offer Americans other than Trump opposition and Russia conspiracy theories.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>The first of those break-out sessions will plot &ldquo;strategy and plans to protect the safety net for low-income families and individuals.&rdquo; Among its attendees will be the director of US Programs for Soros&rsquo;s Open Society Foundations.</em></p> </blockquote> <p>Perhaps getting the opinions of actual poor people might be useful, as opposed to listening to the&nbsp;operatives of&nbsp;billionaires.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong><em>That discussion will be held at Washington&rsquo;s elite Cosmos Club, whose members&mdash;which have included three U.S. presidents, two vice presidents, and 12 Supreme Court justices&mdash;pay&nbsp;<a href="https://www.washingtonian.com/2015/04/29/private-social-clubs-are-doomed/" target="_blank">annual dues of about $2,000</a>.</em></strong></p> </blockquote> <p>How grassroots of them.</p> <p><em><strong>Meanwhile, did you watch the clip of Nancy Pelosi being asked by Anderson Cooper who the leader of the party&nbsp;is?</strong></em></p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/cuu5p2m0ESw" width="560"></iframe></p> <p>Obama and Hillary Clinton.</p> <p><strong>This party is an absolute joke, and the quicker we admit&nbsp;this and create something else, the better. It hasn&rsquo;t changed, and it&rsquo;s not going to.</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="348" height="131" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170322_dems.jpg?1490226902" /> </div> </div> </div> http://www.zerohedge.com/news/2017-03-22/davos-democrats-dnc-mega-donors-meet-mandarin-oriental-hotel-plot-resistance#comments Business Center for American Progress Cosmos Club Davos Demcoratic Party Democracy Alliance Democracy Alliance Democratic National Committee Democratic Party Donald Trump Donald Trump Finance George Soros George Soros Mandarin Mandarin Oriental Money Nancy Pelosi Politics Progressivism in the United States Senate Supreme Court The Alliance The Onion Washington D.C. White House White House Thu, 23 Mar 2017 03:35:00 +0000 Tyler Durden 591483 at http://www.zerohedge.com