Frontrunning: May 27

  • FIFA Raided by Swiss Authorities in 2018, 2022 World Cup Probe (BBG)
  • Companies Send More Cash Back to Shareholders (WSJ)
  • Time Warner Cable Deal Stirs Debt Concerns (WSJ)
  • Qatar $200 Billion World Cup Under More Scrutiny Amid FIFA Probe (BBG)
  • Philippine, Vietnamese troops play soccer and sing on disputed island (Reuters)
  • The G-7's Problem: Can the World Deal With a Greek Default? (BBG)
  • SocGen Deal for Bache Illustrates Commodity-Trading Woe (WSJ)
  • China’s Naval Abilities Test Asia’s Insecurities (WSJ)

No Clues From Gartman About Today's Market Direction

"We begin then by saying without equivocation that we have changed our mind again regarding equities... Hence in our retirement funds here we reduced very slightly our long position in Apple directly and then wrote near-the-money calls  against the remaining position. Further, we sold just out-of-the money calls against the “tanker” shares we owned, and we used the money taken in from those calls to buy more derivatives sufficient to take us back to market neutrality."

Futures Flat After News Greek Deal Distant As Ever, Dollar Surge Continues

It had been a painfully quiet session in Asia (where Chinese levitation continues with the Shanghai Composite up another 0.6% oblivious of yesterday's rout in the US, because as we explained for China it is now critical to blow the world's biggest stock bubble) and Europe, where the only notable news as that for the first time in months the ECB had not increase the Greek ELA, keeping it at €80.2 billion on conflicting reports that Greek deposit withdrawals had halted even as Kathimerini said another €300MM had been pulled just yesterday, suggesting the ECB has reached the end of its road when it comes to funding nearly two-thirds of what Greek deposits are left in local banks. But the punchline came moments ago when Bloomberg reported that "Greece will likely miss a deadline for a deal with creditors by the end of the week as the two sides have made little progress during talks in recent days."

China's Third Bond Default Imminent: Coke Supplier To Miss Payment

Coca-Cola supplier Zhuhai Zhongfu Enterprise Co.will reportedly miss a principal payment on Thursday marking the third onshore default in China and underscoring the growing risks the country faces on a corporate debt pile that now totals some $14 trillion.

Asia Scholar Lays Out "Three Ways China And The US Could Go To War"

"Beijing has not yet declared a formal air defense identification zone (ADIZ) over the South China Sea, unlike the one it established over part of the East China Sea in 2013, nor could it today enforce such a zone effectively with its current fighters. However, with its reclamation activities continuing, and the Obama Administration apparently having decided to challenge China’s claims, the US and China are now potentially closer to an armed encounter than at any time in the past 20 years. Here are three ways the US and China could go to war..."

NATO General Warns, Putin Is A "Dangerous Gambler... Willing To Use Nuclear Weapons"

Hot on the heels of George Soros' warnings that we stand on the verge of World War 3, demanding Washington back off its anti-Yuan pressure, it appears "the good guys" are fighting back with their own good-cop, bad-cop propaganda. As Sputnik News reports, General hans-Lothar Domrose, NATO Commander of the Brunssum Allied Joint Force Command, said in an interview with German magazine Focus Online that Russian President Vladimir Putin is a tough-minded, forward-thinking politician who is capable of foreseeing situations, but also regards him as a dangerous "gambler," who "is willing to use nuclear weapons against NATO troops."

Why China Is So Desperate To Blow The Most Epic Stock Bubble

The Shanghai Composite is on the verge of 5,000 and has more than doubled in the past year but this may just be the beginning. The reason: if the Chinese stock bubble bursts, that will be the beginning of the end of the greatest con game in history.

Pivotfarm's picture

We have fast-paced lives, we pay to get fast-tracked, we eat fast-food and we fast-forward on a film that bores us. Our lives are fast. We even have fast fashion; our clothes are fast these days from catwalk to high street. We have fast love too.

"We're Living In A Make-Believe World" Biderman Warns "A Global Recession Is Inevitable"

"Right now, we’re living in a make believe world. Debt can’t be the main source of growth. Without a pick-up in final demand a lot of bad debts are out there. As long as you have excess capacity in the commodity production you have bad loans throughout the system. That means you have governments who can’t repay their debt without selling new loans and all their bad loans are funded by the central banks.... I think a global recession is inevitable...You just can’t devalue your way to prosperity. As long as the number of shares keeps declining, stock prices are going to go up and nobody cares [but] in the long term there has to be a major correction."

Russia Tells France It Gives Up On Mistral Ship Deal

With French ministers crowing about their better-than-expected GDP data (+0.7%) as some trend reversal that heralds a revolution, it appears Vladimir Putin is about to put a dent in their hopes and dreams. As Sputnik News reports, Moscow has finally given up on the $1.3 billion deal for two Mistral-class helicopter carriers and plans to build its own. Even worse for France, now Russia will discuss only the sum that Paris should pay Russia for the failed contract. However, as with everything in the world, there may be aulterior motive, as China comes sniffing as a white knight for the amphibious vessels (at a reduced price) and then sells to its 'ally' Russia (who has already pocketed the contract cancellation fees).