Last Thursday, when to much fanfare, the latest diplomatic iteration of the Ukraine "de-escalation", i.e., the Geneva Accord, was revealed, we said "Everyone knows that the half-life of these pointless diplomatic summits aimed at "de-escalating" geopolitical tensions is measured in days if not hours..." Looks like many did not know. So moments ago Angela Merkel finally explained it for them, and even the slowst algos:
- MERKEL SAYS GENEVA ACCORD PROCESS HAS FAILED
During discussions with Vladimir Putin today, Merkel said Russia had a chance to convince Ukraine separatists to back down but "that chance has now gone."Perhaps even more concerning is her concluding remark that:
- MERKEL SAYS JOINT G-7 ACTION AGAINST RUSSIA NOW BEING PREPARED
.... To be followed shortly thereafter by the Russian "scorched earth" response to NATO we discussed earlier?
It seems for a brief period, Amazon traders were in denial... but a mere 12 hours after reading our six simple charts explaining the ugluy reality behind this greatest of all momentum stocks, it seems the algos have finally got the message and the game-theoretical first mover advantage is kicking in... Amazon is down almost 6% this morning (and down almost $40 from its post-earnings highs) suggests the Bezos magic money machine is fading fast.
Overnight, four months after our prediction, the FDIC-backed hedge fund not only that, but so much more that even we were shocked, because from a Q1 GDP which Goldman had originally predicted was going to be 3%, the crack team of economists - or is that team of economists on crack - lowered its Q1 GDP to, drumroll, 1%! And that's in the aftermath of the stronger than expected Durable Goods reports. Because it's only logical that good news is bad news. And vice versa.
Just 2 weeks ago, the USS Donald Cook entered The Black Sea on a mission to "reassure NATO allies and Black Sea partners." So, one wonders what it is to be made of the fact that, as ITAR-TASS reports, the US warship USS Donald Cook with the Aegis missile defense system onboard has left the Black Sea, according to a Russian Defense Ministry source. This leaves only the USS Taylor on its mission of "peace and stability"... should NATO allies be un-reassured?
UPDATE: Ukraine Says Provocations Possible Over May 1-9 Holidays
The fighting-talk (and actions) is growing louder from Eastern Europe. Following Lavrov's "bloody justice" comments, Ukraine's Acting Head of the Presidential Administration Serhiy Pashynskyi expects a Russian invasion is imminent, warnings that "in case Russian troops cross the Ukrainian border we will qualify it as military invasion and eliminate invaders." These strongly worded comments come after a Ukrainian military helicopter exploded at a base near the eastern town of Kramatorsk (held by pro-Russian forces) on Friday after being hit by a rocket-propelled grenade. Pashynskyi concludes, rather ominously, "I would not recommend Mr. Putin experiment with lives of his servicemen."
- Russia raises interest rates to 7.5% (FT)
- Shanghai to Allow Raw Material Exchanges in Trade Zone (BBG)
- US, Japan Fail to Clinch Trade Deal (WSJ)
- 'We don't have a magic wand', says ECB's Constancio (Reuters)
- Tokyo Inflation Quickens to Fastest Since 1992 (BBG)
- Demand for Home Loans Plunges (WSJ)
- EU banks urged to grasp chance to raise capital (FT)
The USDRUB rate is back above 36.00 - nearing its record lows - despite a surprise Russian rate hike this morning aimed at stalling the capital outflows. It seems Lavrov's comments that Kiev will face "bloody justice" geopolitical angst is trumping any arbitrage or macro data flows for now. Russian stocks are also fading.
Bonds, Gold, and JPY are bid this morning as US equity futures are fading fast. The Dow and S&P futures are now back below pre-AAPL/FB levels and Nasdaq futures falling fast. Gold is back above $1300 (up over $30 from yesterday's pre-Putin lows). Treasuries, led by the long-end, are rallying as safe-haven bids appear across the whole complex. 30Y yields are down to 3.53 - the lowest since July. JPY is bid once again as USDJPY tests back to the crucial 102 level.
Claiming $100 million in North American weather-related costs, and $310 million losses due to the devaluation of the Venezuelan currency, Ford Motor Company missed revenues and earnings quite significantly:
*FORD 1Q AUTOMOTIVE REV. $33.9B, EST. $34.2B
*FORD 1Q ADJ. EPS 25C, EST. 31C
Furthermore, Ford lost market share (for 0.6 percentage points to 15.3%) and expected operating cash flow in 2014 to be substantially lower than 2013. Ford is trading down 3% in the pre-market.
- Russia has done nothing to implement Geneva accord
- Ukraine will continue to comply with Geneva accord
- Ukraine urges Russia to keep promises, condemn extremists
- Ukraine calls on international community to unite against Russia,
- Russian invasion will turn into Europe-wide conflict, and the punchline:
- Russia Wants to Start Third World War
Presented with no comment... "Today, Bundy revealed himself to be a hateful racist... Bundy has endangered the lives of innocent women and children... it is unacceptable for individuals to use violence or the threat of violence to advance their radical views."
There have been 13 senior financial services executives deaths around the world this year, but the most notable thing about the sad suicide of the 14th, a 52-year-old banker at France's Bred-Banque-Populaire, is she is the first female. As Le Parisien reports, Lydia (no surname given) jumped from the bank's Paris headquarter's 14th floor shortly before 10am. FranceTV added that sources said "she questioned her superiors before jumping out the window," but the bank denies it noting that she had been in therpapy for several years.
If you thought that CCTV cameras tracking your every move in public was bad enough, you’re going to just love AISight (pronounced “eyesight” of course). The invention of a Houston, Texas based company called BRS Labs (which stands for Behavioral Recognition Systems) is headed by former secret service special agent John Frazzini, and this Orwellian surveillance platform brings artificial intelligence to all of those creepy cameras that have been installed everywhere around you. Apparently, this system is currently being installed in Boston, and has already been implemented in Chicago and Washington. The most disturbing part about this platform is that this artificial intelligence defines what is “normal” behavior and anything that falls outside of that narrow band can be flagged for “pre crime” potential.
Some worry about the quality of the drinking water in China, others fear the choking smog of the cities, still more are concerned about the inevitable collapse of their real-estate bubble; but none of these compare to the Gansu Province (in the Northwest of China) strongest sandstorm since at least 1996 that turned day into night Wednesday afternoon.
With President Obama in the middle of the pissing match between Japan and China's nationalist provocations, we thought it perfectly appropriate that none other than Justin Bieber would visit the Class-A war criminal housing Yasukuni shrine. As might be expected, his actions stirred up controversy... We are sure Obama was quick to point out that Bieber is Canadian...