India

The morphing of “terrorism” and “domestic dissent” into an all encompassing and convenient category known as “domestic terrorists” or “domestic extremists” has been a long time coming. It has always been our contention, and continues to be, that the oligarchs who have funneled all of the wealth to themselves since the 2008 banker bailouts know exactly what they are doing. They also know that it will eventually result in severe domestic unrest during the next cyclical downturn. As such, the agenda has been to utilize the entirety of the intelligence-industrial-military complex created by the “war on terror” against the domestic population once it recognizes how badly it has been looted.

In China last year, just over 115 boys were born for every 100 girls, and since sonogram technology was introduced to China in the 1980s - allowing families to determine a baby’s gender during the first few months of pregnancy - the gender imbalance in the world's largest economy has grown colossal. However, as Beijing News recently explained, there may be a solution for China's 34 million woman shortfall... Ukrainian women, as "their economy is depressed but beautiful women are running rampant." While Foreign Policy notes that the best destinations for Chinese men to find spouses are Japan and South Korea, there appears to be plenty of fish in the sea, at least outside China. Oh the wonders of Ricardian comparative advantage - Ukraine needs an export business (and produces - from what we have heard - attractive women) and China needs to import 'women' (to fill its massive shortfall). Global economic growth problems, solved...

Meet Numbeo, the world’s largest database of user contributed data about cities and countries. This infographic uses this information to show the most expensive and cheapest places to live by country. Switzerland and Norway may not surprise you as two of the most expensive countries. However, Venezuela might not have been a place that was on your radar. Of course, in retrospect, when you have inflation spiraling out of control at a rate of 64% per year, that will make things a bit pricey. Want cheap goods and services? Head over to India, Nepal, and Pakistan.

• Falling Prices Spread Pain Far Across The Oil Patch (WSJ)
• ISIS Group Claims Responsibility for Attacks That Killed 27 in Egypt (NBC)
• Russia Unexpectedly Cuts Key Rate as Economy Eclipses Ruble (BBG)
• Greece’s Feisty Finance Minister Tries a More Moderate Message (NYT)
• U.S. homeownership hits 20-year low, but new households growing (Reuters)
• Indian Banks’ Shares Plunge as Bad-Loan Provisions Surge (BBG)
• Underground Terror Network Said to Benefit Would-Be Jihadists in Europe (WSJ)
• Russia warns West support for Kiev could lead to 'catastrophe' (Reuters)

Yesterday we reported that in less than 1 month in 2015, so far a whopping 13 countries have proceeded with "surprising" rate cuts: Singapore, Europe, Switzerland, Denmark, Canada, India, Turkey, Egypt, Romania, Peru, Albania, Uzbekistan and Pakistan. As of this morning, make that total 14, because in one of the more "surprising surprises" so far, it was none other than the Bank of Russia which cut its main interest rate from the 17% shocker it instituted at an emergency session on December 17 to halt the Ruble collapse (as a result of the crude price plunge) to 15% less than an hour ago. At the same time it cut the deposit rate to 14% and the repo rate to 16%.

For those keeping track of currency wars around the globe, 2015 - a year in which two central banks, those of Switzerland and Singapore have already admitted defeat, is shaping up as nothing short of historic. As DB's summarizes: just about 31 countries have, in less than a month, eased in the form of 13 mostly "surprise" rate cuts, while just 5 have tightened monetary policy.

• Who Doubts Yellen's Policies? Summers for One (BBG)
• Samsung, Apple Back in Dead Heat for Global Smartphone Dominance (WSJ)
• Islamic State purportedly sets new deadline for hostage swap (Reuters)
• Turkey's $7.9 Billion Mystery Money That's Simply Vanished (BBG)
• How a Two-Tier Economy Is Reshaping the U.S. Marketplace (WSJ)
• U.S. Prisons Grapple With Aging Population (WSJ)
• Hasenstab Sees $3 Billion Vanish in Ukraine as One Big Bet Sours (BBG) - maybe he should BTFD, pardon, "invest" in Belarus next?
• Belarus May Seek Debt Restructuring in 2015, President Says (BBG)

The bottom line is that unfortunately for the BTFDers, with the Fed no longer giving explicit buy signals with the "considerable time" language struck, and with an implicit economic upgrade suggesting a rate hike is still on the table, it is becoming increasingly more difficult to frontrun the Fed's "wealth creation" intentions.

"Eighty people hold the same amount of wealth as the world’s 3.6 billion poorest people, according to an analysis just released from Oxfam. The report from the global anti-poverty organization finds that since 2009, the wealth of those 80 richest has doubled in nominal terms — while the wealth of the poorest 50 percent of the world’s population has fallen." There you have it. The reason the wealth of the richest has doubled since 2009, is because “it’s not a recession, it’s a robbery.” Central bank and government policy has done this, it is no accident.

The threat posed by cyber war to our increasingly complicated, technologically dependent and vulnerable financial institutions, markets, banks and indeed deposits becomes more clear by the day. Fail to prepare ... prepare to fail ...

Who says the Russians, increasingly isolated by the west (Europe and the US threatened over the past 24 hours to escalate sanctions yet again) and increasingly more welcome by China, India and the rest of the non-western world, don't have a sense of humor? Days after the speaker of the Russian Duma, Sergei Naryshkin, faced scathing criticism of Russia's annexation of Crimean peninsula when he spoke at the Parliament Assembly of Europe, he has come up with a novel suggestion when he asked a committee to study a proposal to condemn the reunification of Germany in 1990.

US earnings drop materially less than a week after the ECB fires its gun & competing nations only start to react - just like the reaction at the beginning of the Great Depression! Rememberr, this isn' even a shootout yet. Wait until next quarter when the US multinatonals report. Of course, by then it'll be ALL OUT WAR!

2015 will be a year of shattered illusions; social, political, as well as economic. The common claim today is that the QE of Japan and now the ECB are meant to take up the slack left behind in the manipulation of markets by the Fed. I disagree. As I have been saying since the announcement of the taper, stimulus measures have a shelf life, and central banks are not capable of propping up markets for much longer, even if that is their intention (which it is not). Why? Because even though market fundamentals have been obscured by a fog of manipulation, they unquestionably still apply. Real supply and demand will ALWAYS matter – they are like gravity, and we are forced to deal with them eventually. The elites hope that this will be enough to condition the public to support centralized financial control as the only option for survival... It is hard to say what kind of Black Swans and false flags will be conjured in the meantime, but I highly doubt the shift away from the US Dollar will take place without considerable geopolitical turmoil.

Given that Russia perceives itself to be under financial and economic attack from the West, there is the possibility that they are accumulating more gold than they are declaring officially to the IMF.

De Nederlandsche Bank, the Dutch central bank has denied reports in Reuters, Bloomberg and picked up by GoldCore, that the bank had increased its gold holdings for the first time in sixteen years. IMF data had shown that the Dutch had increased their holdings to 622.08 tonnes.

Chairman of the Joint Chiefs, General Martin Dempsey has, according to Politico, asked The National Defense University to establish an essay and research competition focused on the Middle East in honor of Saudi Arabia’s late King Abdullah. How very generous for America's top uniformed military leader to recognize such a leader of another nation... Though no details of the prize are available, we thought we would take a stab (figuratively) at an essay...