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The latest diplomatic spat to divide the EU worsened materially on Wedensday when Brussels opened an official inquiry into new media laws enacted in Poland. Although the laws have drawn criticism domestically as well as abroad, the Polish government views the probe as a violation of sovereignty by an increasingly intrusive Berlin.

While Chinese New Year seasonals are undoubtedly one factor in last night's "surprisingly good" Chinese trade data, the following chart shows the level of "bullshit factor" was extreme by anyone's measure. Three years ago we first brought China's 'fake' trade data and abundant discrepancies to the public's attention and despite an apparent crackdown by regulators, the gaping difference between imports from Hong Kong and exports to Hong Kong is downright embarrassing for China's SAFE as it is clear that capital outflows are being disguised as exports with "over-invoicing" back in play.

Russia has just taken significant steps that will break the present Wall Street oil price monopoly, at least for a huge part of the world oil market. The move is part of a longer-term strategy of decoupling Russia’s economy and especially its very significant export of oil, from the US dollar, today the Achilles Heel of the Russian economy.

As BofA admits, "we are increasingly concerned with this trend, as on an unadjusted basis non-commodity earnings growth has been negative 2 of the last 4 quarters, representing the worst 4 quarter average earnings growth in a non-recessionary period since late 2000."

“I’m not going to answer that. No, no, no. I don’t want to talk to you”...

“For them to say ‘hey you owe it to us, it’s Springfield’s fault, pick up our pension liability and let us kick the can in the rest of our pension liability, no, no, not happening.”

This decline is inevitable in fast-expanding economies that play fast and loose with credit/debt and leverage. All the phantom wealth piled up in China's boost phase is now melting down, and the China Syndrome will trigger a meltdown in global phantom assets.

"Panic is building, most likely setting the stage for a rally, but the missing ingredient here is growth. With analysts cutting estimates at an accelerating rate, increasing China risks and no apparent floor for oil prices, we remain cautious on our near term outlook for stocks."

In principle, the BRRD, or “bail-in directive” as it is also known, is quite a good idea. The fact that lending money to fractionally reserved banks or even merely depositing it with them, involves risks needed to be firmly reestablished. One simply cannot expect that banks and their creditors will be bailed out by taxpayers at every opportunity. Besides, the admission that there are risks in banking that have hitherto been glossed over or have even been lied about was long overdue. However, Europe’s governments are now likely to find out that the current monetary system with its fractionally reserved banks is actually incompatible with this admission, so to speak.

 In short, for oil prices to recover, US Production needs to drop to at the very least 6 million barrels per day for the market to rationalize in price.

"The increasingly frequent departures from Constitutional principles are destroying the Rule of Law foundation on which this country was built... The cure to these problems will not come from Washington D.C. Instead, the states must lead the way. The irony for our generation is that the threat to our Republic doesn’t come just from foreign enemies, it comes, in part, from our very own leaders."

- Texas governor Greg Abbott

Once, there was a time when Hitler, Stalin, Mussolini and Tojo ruled almost all of Eurasia. And another time when a monolithic Sino-Soviet Communist bloc ruled from the Elbe to the Pacific. As those times are long gone, is it not time for an exhaustive review of the alliances we have entered into and the war guarantees we have issued, to fight for nations and interests other than our own?

Earlier we gave a big picture explanation how the US can add 292,000 while average hourly wages actually decline. Below is a more nuanced answer, looking at the breakdown of jobs by industry in December.  It will probably come as no surprise to anyone that for another consecutive month, the well-paying jobs: mining and logging, wholesale trade, manufacturing, and information barely posted a net increase. At the same time, the poor paying jobs continued to soar.

Daniel Yergin and other experts say that U.S. tight oil is the swing oil producer of the world. They are wrong. It is preposterous to say that the world’s largest oil importer is also its swing producer. There are two types of oil producers in the world: those who have the will and the means to affect market prices, and those who react to them. In other words, the swing producer and everyone else.

Once China set the Yuan fixing some 0.5% lower, the biggest drop since the August devaluation, all hell broke loose and unleashed a global selling panic after China's stock market was promptly shut down less than 30 minutes into trading, then European shares dropped the most in more than 4 months as Asian equities plunges, as did US stock futures, the dollar weakened against the euro and the yen; crude plunged to fresh 12 year lows. Gold rose.