Putin "Talks" Spark Another De-Escalation-Fueled Hope Bounce In Stocks

Tyler Durden's picture

Forget POMO, today's market is all about FOMO - fear of missing out - when Ukraine is 'fixed' and new newer-er highs are achieved. All it took this morning to lift S&P futures 8 points was a headline that:

  • PUTIN, OSCE HEAD BURKHALTER TO DISCUSS UKRAINE CRISIS

USDJPY responded instantly, as did bond yields (higher) and gold (lower) as it's clear that everything will be fixed now. Of course, the Geneva "de-escalation" lasted 1 days; this latest "diplomacy" should last hours if not minutes, but for now the high freaks are delighted and upward momentum has been restored.

 

 

Of course, Yellen is also speaking this morning so there's enough rumor-mongering there alone to provide support in the pre-market illiquidty also.

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Headbanger's picture

Yeah never mind thousands of Russian tanks still being sent to the Ukraine border.

GetZeeGold's picture

 

 

It's just a police action...

Haus-Targaryen's picture

I would love to see a Vladamir Putin copy/paste of the Reagan pre-speech from 1985.

"I have just signed legislation banning the existance of the Ukraine. Bombing starts in 5 minutes."

Just to see market reaction.

Ghordius's picture

lol, yes. question is: would algos "grok" the implications? do algos understand humour, or sarcasm?

wallstreetaposteriori's picture

AI algos can... fuck people...who needs them.

Arius's picture

same kabuki over and over ... guess no new ideas ... if it works why change it ...

Ignatius's picture

After Reagan's visit to the Berlin wall in Germany and plea to Gorbachev, I always wanted Reagan to visit The Great Wall in China and plead to the Chinese President

"Chairman Li Xiannian, tear down this wall."

Reagan had a sense of humor, he might have done it.

disabledvet's picture

He should have gone to China and said "Build up this Wall! And we'll help you!" In the meantime the various skirmishing activities continue apace followed ye olde timey "hey, Johnny Reb! What u eatin fer grub?"

Followed by "Sem as you Yank Doodle. Just whatever we can scrounge up."

Ghordius's picture

it's not really a civil war at this stage, and I hope it won't become one. meanwhile the OSCE guys think they might find some compromise for de-escalation. a further hope

LawsofPhysics's picture

Yes, it appears that plenty of countries are willing to pay for Russia's commodities using rubles...

"problem" solved, rally on!

Haus-Targaryen's picture

As long as the two sides look at this situation like this:

Russian Prospective; 

"Tell you what EU, we'll compromise if you just leave the Ukraine to me.  Don't worry, we'll take care of it."

EU Prospective;

"Tell you what Vlad, we'll compromise and just take all of the Ukraine.  I am sure you're okay with that."

I think a Civil War in Ukraine is the "best case" scenario.  Last thing we need are EuroFighters and Typhoons getting blown out of the Sky by MiGs. 

Ghordius's picture

I miss the Ukrainian and the US perspective in your analysis. what do you think that is more important for the EU countries, Ukraine or... Russian trade?

Haus-Targaryen's picture

I didn't include the US and Ukraine for two reasons,

1) The US and EU's interests here are almost indistinguishable.  I doubt the US would kill off the EU economy just to impose sanctions on Russia (which is what the effect of really severe sanctions would be).  The US has a big talk, but here the EU and US are almost one in the same.  (Thanks you Bilderburger fuckers)

2) The prospective of the Ukranian people is irrelevant.  Neither the US/EU or Russia care at all.  They will use humanitarian reasons for the "people of Ukraine" to do this and that -- but at the end of the day, its all about the power struggle between the two.  Pure and simple.

gcjohns1971's picture

Ukraine in the EU view is a pawn.  But for Russia, it is a major strategic epicenter.

The EU needs to win in one or more of:  Syria, Georgia, Libya, Algeria, Tunisia.  A win there will get them their alternate energy supplies.

Russia MUST keep Crimea for the warm water port.  Russia also has a strategic interest in the Ukraine's terrain.  The same terrain that makes it the best place for pipelines from middle eastern and central asian energy providers, also makes it the best route to invade Russia from the West.

Putin is trying to satisfy Rosneft and Gazprom - mostly Gazprom - who want to be the major energy suppliers to Europe.

Germany's WWII and WWI experiences tell them that to allow themselves to be overly dependent on an energy supplier is to stop being an independant nation, and become a dominated puppet.

Russia is NOT IN A GOOD CHESS POSITION VIS-A-VIS UKRAINE, because they've been maneuvered into a choice of losing CRIMEA or losing the pipeline terrain.

To keep both, Russia cannot have a Civil War in Ukraine.  A Civil War in the avenue to Russia is not a secure avenue to Russia.  Meanwhile the timing and method the Crimea referendum has led Europe and the US to not recognize the Annexation. 

Plainly, the agitation in the Avenue-to-Russia part of Ukraine will continue until they get their energy suppliers.  Alternatively, Russian Crimea is not secure while Ukraine generally, is unsecure.

Of course, if Putin gives Gazprom and Rosneft the shaft, and lets other energy providers use the pipelines - or build their own on Ukraine's territory - then the problems in Ukraine will calm.

But politically, Putin can''t do that.  He has debts to Rosneft and Gazprom.  That is the nature of oligarchy.

 

stewie's picture

Russia is NOT IN A GOOD CHESS POSITION VIS-A-VIS UKRAINE, because they've been maneuvered into a choice of losing CRIMEA or losing the pipeline terrain.

 

How is that? Care to expand?


gcjohns1971's picture

You are right.  You will get a MINIMUM of a Civil War in Ukraine.

The EU wants alternate energy suppliers.  I say 'EU' but the primary actors are France and Germany. 

They have multiple ways to get them.  Russia has been working to stop them, wanting to keep them dependent.

The real question is whether their will to diversify is greater than Russia's will to keep them on the plantation.

I would bet that it is - because survival is always a greater motivator than dominance.

So...the EU has been lighting fires in all the Russian Ally states along energy pipeline routes. 

Because it is easier to light a fire than put one out, they are tying up more and more of Russia's resources, while conserving their own.

The only way that the Chess works out for Putin in any time horizon longer than an handful of years is if he can settle Ukraine quickly - so Russia's resources can address the other fires.

The problem with Russia's position is that they too have Cold-War-Itis.  They've been assuming the Americans were calling the shots, when plainly they aren't.  QUI BONO? 

If the Americans are calling the shots then why is he negotiating with Euros?

The problem is that to win, Russia must win every battle.  But for the EU to win, they need only win once.

So...it is nice to talk about who is a 'Chess Master'.  But it is BS.  Countries don't resort to using Armies when they are in control of the situation.  They use Armies when the situation is spinning out of control.

Night before last on Russian State TV (Channel 1) there was a segment about the History of Ukraine.  The Russian State now claims that Ukraine is an imaginary country, that Ukraine is really Russia, and always has been. 

They displayed maps over the last two centuries to convey the idea that Ukraine alternately did not exist, or was divided between Poland, Russia, and the Ottomans. 

They only have to erase or ignore the previous 1000 years, where Ukraine as a separate country under the prince of Kiev is mentioned even in the Russian First Chronicle, with the division of Ukraine resulting from the final conquests of the Mongol Golden Horde and the Princes of Europe who rallied to stop them.

I mention this because this bit of history is taught in Russian primary schools.  No doubt they are busy re-writing textbooks as we speak. 

To make such an outrageous claim indicates two things:

1) Russia is seriously contemplating conquering Ukraine -or at least all the important bits - and is articulating justifications for that.

2) Short of erasing ENORMOUS swaths of Russian history, they don't have a justification, or the State TV would never have broadcast such a ridiculous assertion.

None of this, neither the Russian State's telegraphing of their intentions, nor the geopolitical positioning of the EU indicates anyone is remotely willing to back down.

silvermail's picture

They only have to erase or ignore the previous 1000 years, where Ukraine as a separate country under the prince of Kiev is mentioned even in the Russian First Chronicle, with the division of Ukraine resulting from the final conquests of the Mongol Golden Horde and the Princes of Europe who rallied to stop them.

----

Ancient Kiev has never been the capital of the Ukraine.
Ancient Kiev for some time, was the capital of Ancient Rus (in Greek it sounds like Russia).
Kiev prince named as "Prince of All Rus."
Kiev prince "Vladimir Clear Sun" was a prince of all Rus and he brought Christianity to the Ancient Rus. 

Prince Vladimir as Prince of All Rus, was received from the Greek Church the right to bring Christianity to the ancient Rus.
Because he was the leader of the country, which was called the Rus, but not Ukraine.

You need to pay more attention to the study of history and less to listen to propaganda.

Haus-Targaryen's picture

lol this whole situation. 

1stepcloser's picture

Putin just figured out he is more powerful than Yellen!  

Max Damage's picture

What a complete and total farce of a market

101 years and counting's picture

nice knowing Putin is adhering to the script.  

Ignatius's picture

"Farce?"  Peace in our time, baby. 

useless_fact's picture

The founders of Hewlett-Packard flipped a coin to determine whose name would come first in the company.

GetZeeGold's picture

 

 

OK wuss.....heh heh.....I was so close!

 

Someone over there must work directly for Beelzebub.

fonzannoon's picture

They threw up a bond thread so I moved the comment over there.

GetZeeGold's picture

 

 

Understandable. It's just that I really wanted that softball....and it was suddenly gone mid-pitch.

Peter Pan's picture

Russia does not want to be drawn into a conflict that will drain her of blood and money. The USA is a stark reminder of where these things lead as is Afghanistan.

Nor does she want to wear the economic albatross called UKRAINE around her neck.

The only outstanding issue is how the Russians in the rest of Ukraine are treated, where the "allies" decide to place their missiles and whether Ukraine keeps paying for any gas it receives.

Ghordius's picture

and how Russian (-speaking) populations will be treated in our dear allied (NATO and EU) Baltic Nations

I was quite mad when there was this thing about an "Oath of Allegiance"

Omen IV's picture

given the timeline to the 25th and nothing done for the referendum- i agree that it appears Russia is standing down.

but the short term benefits you cite to russia will be negated in the long term danger to Russia as the USA abrogates whatever it agrees to - they want Russia and all the resources for the US - its how the debt gets paid for europe and usa.

The eastern Ukrainians will become refugees to Russia as they are forced out economically with no jobs by the IMF and the Ukranian American Business Counsel

so after hundreds of years Russia may finally be at the horizon of being broken up and divided for privatization in the next 20 years

sad - unipolar system will be death to most of mankind as corporations replace sovereign states and austerity is imposed everywhere

Uncle Remus's picture

W in TF are you prattling on about?

jtz5's picture

So, the markets have not been concerned about war in Ukraine at all up to this point, but if there is a resolution to this conflict, we are due for a relief rally.  Makes perfect sense...

/s

Winston Churchill's picture

Lavrov already put a pre condition on further talks on Monday.
The east must be a party to any agreement.
BS rumor , because the US will never agree to that.

LawsofPhysics's picture

It's almost as if the west really doesn't want any sort of election to occur. < shocker >

james.connolly's picture

Your grand-son just took over the helm of SERCO-GROUP today, I think you can sleep happy for a few hours.

SilverIsMoney's picture

Totally normal human behavior..

No reaction to the war but everything goes the planners way when they get news they can manipulate the market with!

Peter Pan's picture

Putin always has the option of releasing the harpies. That is, he just has to say that he is using US treasuries to buy gold.

In fact he just has to hint at it. Why should only Bernanke, Draghi and now Yellen try to drive the markets with hints?

Sudden Debt's picture

PUTIN HAD A HAMBURGER FOR LUNCH TODAY

This could indicate Putin want's to swallow anything Merkel and Obama throw at him as "Hamburger" is a German city but "Hamburger" is also something America claims to have invented.

Thus, the market should rally 5% on every index and gold should drop 900$ easy.

thank god he didn't eat any noodles...

Antarctico's picture

PUTIN HAD A HAMBURGER FOR LUNCH TODAY

 

Chez-burger, bacon chez-burger, or boring normal-fuck burger -- The world wants to know!

SheepDog-One's picture

If Putin haz chez-burger, that's probly worth 15 S&P points!

Mabussur's picture

What is really important is : Did he eat the fucking pickle ?

Antarctico's picture

Did he eat the fucking pickle ?

I hear that's more Barry's thing.

Peter Pan's picture

Eating a hamurger could be a message to the USA as to how he views America.

In any case, AMERICA is an anagram of A CRIMEA

Sudden Debt's picture

MY GOD! HOW COULD WE HAVE MISSED THAT??!

truth serum's picture

The US dollar is in its final days, maybe last chance to pick upgold.

fonzannoon's picture

we all need to take some time and reflect on this USD/JPY effect on the markets.

fonzannoon's picture

haha It just cracks me up how quick the narrative around here changes laws. Looks like this is really gonna be a death by a million cuts market.