European Union

• ‘Flash Crash’ Overhaul Is Snarled in Red Tape (WSJ)
• ECB Considers Tighter Noose on Greek Banks (BBG)
• Dollar Falls as U.S. Data Cast Doubt on Fed Policy Tightening (BBG)
• Market U-Turn Rams Hedge Funds (WSJ)
• Greece makes 200 million euro IMF payment due Wednesday (Reuters)
• Greek unemployment was 25.4 percent in February (Reuters)
• J.P. Morgan’s Barista-Turned-Banker Sees Good Things Brewing (WSJ)

Americans might be quite surprised to know that even with all the U.S. Government sanctions and threats of war with Russia, America still imports a significant amount of petroleum from the former communist country. How much petroleum does the United States import from Russia? Actually, a lot more when we focus on net imports...

On the heels of Monday's news that the IMF may demand a write-off of Greek debt by European creditors before the organization will disburse its portion of a €7.2 billion aid tranche to Athens, it now appears the situation has deteriorated further with unnamed Greek officials reporting "serious disagreements" between the IMF and the EU which may make a compromise "impossible" by the critical May 12 deadline.

Turkey is currently trying to decide which of the two similar though competing projects - the Eurasian or the European Energy Union - would be more beneficial for the country. Russia’s attempts to build an ever closer relationship with Turkey - and the latter’s openness to such gestures - will complicate regional energy geopolitics further. Thus, Brussels and Ankara are likely to disagree on strategically important energy security issues over the coming years unless Turkey and the EU can achieve tighter cooperation under the framework of the European Energy Union. But if Turkey instead starts to pursue a more independent policy, particularly one at odds with the European Union, the Eurasian region will experience ever more unstable and competitive energy geopolitics.

There is little sign that Washington and its vassals care about life on Earth.

This conflict is not about Ukraine but about the future of the planet. There is no “Novorussian” or even “Ukrainian” solution. The only possible outcome is a strategic victory of either Russia or the USA which will affect the entire planet. In the following, Rostislav Ishchenko provides a superb overview of the risks and options for both sides and offers the first comprehensive “key” to the apparently incomprehensible behavior of Russia in this conflict.

Earlier this week, Greek pensioners discovered that a "technical glitch" caused the delay of some €2 hundred million in pension payments. Apparently, Athens ran out of money. Exhausted, exasperated, and short on cash, restless retirees have now taken to storming pension fund meetings and forming lines at banks.

• Record month ends in pain as biotech, small-caps, Apple tumble (BBG)
• Japan inflation rises for first time in nearly a year (WSJ)
• US Navy starts to accompany ships in strait where Iran seized cargo carrier (WSJ)
• Russia may be readying for new Ukraine offensive: NATO commander (Reuters)
• Big banks use loophole to avoid ban (WSJ)
• China April official PMI shows factories struggling to grow (Reuters)
• CME suspends traders for alleged Sarao-like manipulation (BBG)

Will a desire to protest the current establishment see Nigel Farage's UKIP broaden its mandate in the upcoming election? This UK election will mirror many elections around Europe (since the crisis started) in focusing on inequality and the need for political protest. This could make for big moves in the mandates... We foresee Scottish National Party and UKIP protest votes proving far more numerous than the latest polls suggest.

• Maryland Governor Calls in National Guard to Control Baltimore Riots (BBG)
• Fed Seen Delaying Liftoff to September to Push Down Unemployment (BBG)
• Nepal PM says toll could rise to 10,000 (Reuters)
• China Readies Fresh Easing to Tackle Specter of Debt (WSJ)
• ‘Damned Lies’ Threaten to Overshadow U.K. GDP in Election Fight (BBG)
• Uncertainty Over Impact of a Default by Greece (NYT)
• Why the Cost of Hedging European Banks Stocks Has Soared (BBG)
• Carinthia cash crunch gives Austria its own mini-Greece (Reuters)

While sentiment towards gold in the West is abysmal - even as gold languishes at record lows when adjusted for inflation - Asian demand remains insatiable. It would be wise for investors to inform themselves as to why this should be so. Demand for gold in Asia is often written off by Westerners as an irrational impulse of uneducated Asian peasant farmers and workers. 

As the Greek negotiations with the eurogroup and the ‘institutions’ show us with intense and increasing clarity, the notion of the euro being a boat to lift all tides turns out to be full-on bogus. Southern Europe’s nations will be either thrown out or allowed to stay only as debt servants. For now, Germany and Holland prefer to keep everyone on board, but that may still change. It would therefore seem like a good idea for Greece and Italy to make their moves while they can. What Tsipras and Varoufakis must accomplish is to make people understand that what Europe does to the refugees, it will do to its own citizens too.

"The EU and US need to hear the pleas coming from the southern European countries, as well as those of the refugees. The humanitarian catastrophe has reached large scale, with profound and irreversible consequences. Greece is paying a disproportionately high price, although Greece played no role in triggering this catastrophe. The EU and the US have the moral obligation, which is also consistent with their long-term interests, to take the necessary steps to put an end to the suffering of those in war zones, while at the same time preventing Greece’s collapse under the mounting pressure of refugees."

• Obama’s Drone-Strike Rules to Be Reviewed (WSJ)
• Hostage locations difficult to track - and may be getting harder (Reuters)
• Varoufakis Said to Take Hammering From Riled EU Ministers (BBG)
• EU Frustration Mounts as Greeks Try to Bypass Aid Process (BBG)
• Kleiner Perkins seeks almost $1 million in costs in Pao case (Reuters)
• Google Misses, Caps Costs as Growth Slows (WSJ)... stock surges 
• Oil prices trade near 2015 highs on Yemen worries (Reuters)
• Pentagon Announces New Strategy for Cyberwarfare (NYT)
• Bloomberg Oil at $65 Seen Freeing 500,000 Barrels From Shale Fracklog (BBG)
• ‘Flash Crash’ Trader Navinder Sarao: It Was Wits, Not Bits (WSJ)

The new term follows in the footsteps of the classic (but now tired) “Grexit” and its underrated predecessor “Graccident,” and refers to two of the four outcomes Citi imagines are possible in the unfolding Greek drama. The bad news: both scenarios involve capital controls, deposit flight, and defaults.