Morgan Stanley

• Confusion as Ukraine and Russia announce progress towards peace (Reuters)... but not for stock buying algos, they know everything
• Obama Expresses Skepticism About Possible Ukraine Cease-Fire (WSJ)
• Fighters Unwind in Russia Where Beer Doesn’t Spell Death (BBG)
• Despite dangers, U.S. journalist Sotloff was determined to record Arab Spring's human toll (Reuters)
• New Beheading Video Spurs Calls for Global Response (BBG)
• Christie’s Spending on Outside Lawyers Passes $50 Million (BBG)
• IEX to Apply for Exchange Status (WSJ)
• UK says not ruling out airstrikes against Islamic State, says hostage video genuine (Reuters)

Do you believe in miracles? Morgan Stanley's Adam Parker does, having given up on his sane bearish case long ago, he now predicts S&P to 3,000 because "if we get EPS growth of 6% per year from 2015-2020, that would drive S&P500 earnings to near $170; a 17x multiple would translate into a peak level for the S&P500 near 3000 under this scenario." So, just some simple math, eh? But he does add, "of course, no one can predict unforeseen shocks to the economy," but they will never happen, right?

Just when we thought centrally-planned markets could no longer surprise us, here comes last night's superspike in the USDJPY which has moved nearly 100 pips higher in the past few trading days and moments ago crossed 105.000. The reason for the surprise is that while there was no economic news that would justify such a move: certainly not an improving Japanese economy, nor, for that matter, a new and improved collapse, what the move was attributed to was news that Yasuhisa Shiozaki, who has been advocating for the GPIF to reduce allocation to domestic bonds, may be appointed the Health Minister when Abe announces his new cabinet tomorrow: a reshuffle driven by the fact that the failure of Abenomics is starting to anger Japan's voters. In other words, the GPIF continues to be the "forward guidance" gift that keeps on giving, even if the vast majority of its capital reallocation into equities has already long since taken place. As a result of the USDJPY surge, driven by a rumor of a minister appointment, the Nikkei is up+1.2%, which in turned has pushed both Europe and Asia to overnight highs and US equity futures to fresh record highs, with the S&P500 cash now just 40 points away, or about 4-8 trading sessions away from Goldman's revised 2014 year end closing target.

Although I never thought it was possible, it makes me angry to write this book review. I'm not angry because I don't like the book. On the contrary, this is the best economics book I've ever read. Indeed, it may be the best and most influential book I've ever read in my life. I only wish I had read it the moment it was published in April 2013. 

Thanks to the growing use of fracking, or extracting oil and natural gas from shale formations, shares of U.S. companies which supply sand to energy producers are surging, and as Bloomberg reports, it does not look set to stop anytime soon. “Sand is the new gold,” says Ivaylo Ivanov, founder of Ivanhoff Capital, as Ole Slorer, a New York-based analyst at Morgan Stanley, expects demand for fracking sand in 2016 will be 96 percent higher than last year’s level. Nope, no bubble here...

We believe Fed’s actions would be more appropriately described as permitted cancerous beliefs to spread throughout the financial system, thereby killing Democratic Capitalism which is the basis of the capital markets. Today we’re going to explain what the “final outcome” for this process will be. The short version is what happens to a cancer patient who allows the disease to spread unchecked (death).

• Clearly it's time to bomb Assad (on Qatar instructions): Islamic State executes dozens of Syrian army soldiers (Reuters)
• Ukraine Declares Russian Invasion as Sanctions Threat Raised (BBG)
• Ukraine Reports Russian Invasion on a New Front (NYT)
• German Unemployment Rises as Risks to Economy Build (BBG)
• Ebola spreads to Nigeria oil hub Port Harcourt (BBC)
• FBI Probes Possible Hacking Incident at J.P. Morgan (WSJ)
• FBI, Secret Service investigate reports of cyber attacks on U.S. banks (Reuters)
• If you like your Venezuela, you can stay in Venezuela: Airlines Abandon Fliers Amid Currency Dispute (WSJ)
• Boomer Wealth Dented by Mortgages Poses U.S. Risk (BBG)
• People Aren't Buying Guns (BusinessWeek)

• FTW: Europe Stocks Rise as Data Signals Need for Stimulus (BBG)
• More de-escalation: Dozens die in Ukraine in street battles, Donetsk shelling (Reuters)
• Calm largely holds in Missouri after grand jury opens shooting investigation (Reuters)
• Attorney General Eric Holder Vows Thorough Probe of Ferguson Shooting (WSJ)
• World’s Biggest Wealth Fund Slows Emerging Market Investment (BBG)
• Market Chilly to Argentine Debt Proposal (WSJ)
• Israeli air strike kills three Hamas commanders in Gaza (Reuters)
• Retooled Hamas Bloodies Israel With Help From Hezbollah (BBG)
• Investors Pour Into Vanguard, Eschewing Stock Pickers (WSJ)
• Fed Debates Early Rate Increases (WSJ)

With the FOMC Minutes in the books, the only remaining major event for the week is the Jackson Hole conference, where Yellen is now expected to talk back any Hawkish aftertaste left from the Minutes, and which starts today but no speeches are due until tomorrow. And while the Minutes were generally seen as hawkish, stocks continue to levitate, blissfully oblivious what tighter monetary conditions would mean to an asset bubble, which according to many, is now the biggest in history. And speaking of equities, US futures climbed to a fresh record high overnight on just the right mix of bad news.

For most (practically all) Americans, this is officially the worst recovery ever. As we pointed out previously, wage growth has never been slower in a post World War II recovery. However, not everyone is hurting...

*GOLDMAN SACHS SAID TO RAISE JUNIOR STAFF'S SALARIES ABOUT 20%

This comes just weeks after Morgan Stanley announced it would raise junior banker salaries by 25%. It appears President Obama's hopes for 'fair, livable' minimum wage is being heeded by the banking community - good patriots, they are.

• Ferguson at Turning Point After Night of Relative Calm (BBG)
• Gaza war rages on, Hamas says Israel tried to kill its military chief (Reuters)
• Surge in Putin Patriotism Masks Pain of Sanctions (BBG)
• Bank of England splits over rate hike for first time in 3 years (Reuters)
• Putin Meeting Leaves Kiev With Tough Choices (WSJ)
• European Gas Reverses Biggest Drop Since 2009 on Ukraine (BBG)
• "Isolation"  Mongolia Seeks Economic Lifeline With Pivot to China, Russia (BBG)
• Uber Picks David Plouffe to Wage Regulatory Fight (NYT)
• China Levies Record Antitrust Fine on Japanese Firms (BBG)

• Just how many rats are there? Steven Cohen's Firm Loses Another Top Executive (WSJ)
• Iceland Sees a Potential Volcanic Eruption, and Airlines Cower (Bloomberg)
• Iraqi forces battle to drive jihadists from Saddam's home town (Reuters)
• Israel, Palestinians Agree to Extend Gaza Truce for 24 Hours (BBG)
• Pimco now buying junk (BusinessWeek)
• Pakistan arrests 147 in Punjab towns as protests in capital continue (Reuters)
• Ex-Rabobank Employee Pleads Guilty in Libor-Rigging Probe (BBG)
• Ebola Orphans Targeted by Aid Groups as Newest Victims (BBG)
• Two California youths accused of plotting high school shooting spree (Reuters)
• Only Rich Know Wage Gains With No Raises for U.S Workers (BBG)

• Yellen Dashboard Warning Light Glows as Millions Work Part Time (BBG)
• More US drones boosting global GDP: Unidentified war planes, explosions heard in Libyan capital (Reuters)
• London Home Asking Prices Plunge Most in More Than Six Years (BBG)
• Carney - Rate Hike before Pay Recovers (Times)
• No Fed fireworks, but plenty of clues, expected at Jackson Hole (Reuters)
• Kurdish, Iraqi forces in control of Mosul dam (Reuters)
• China Pushes Cleanup of Banks (WSJ)
• Russia Widens Ruble Trading Band in Move Away From Managed Rate (BBG)
• Dollar General Makes $9.7 Billion Family Dollar Counterbid (BBG)
• Autopsy finds unarmed teen killed by police was shot six times (NYT)
• Bull Market Waning as Barclays Sees 1% Gain for S&P 500 (BBG)
• Credit Suisse Caught Up in Espírito Santo Mess (WSJ)

• Barack Obama's 'vacation from hell' (Politico)
• Russian aid convoy checked; military vehicles mass near Ukraine (Reuters)
• Ukraine Says APCs Entered From Russia to Aid Insurgents (BBG)
• Islamic State Said to Challenge Al-Qaeda for Leadership (BBG)
• Missouri protests calmer after governor puts black police captain in charge (Reuters)
• Finally someone will prove the US is a pyramid scheme (in a 1000 page presentation): Ackman’s Pershing Square Sues U.S. Over Fannie, Freddie (BBG)
• Banks, Financial Firms Load Up on Cheap Debt (WSJ)
• Putin to Meet Finnish President as Threat of Cold War Grows (BBG)

Ways for retail investors, and institutions small and large, to monetize a fundamental or economic outlook that the muppet masters will never tell you!