Apple

Stock buybacks have been in the news lately, as their growing size has lead to criticism, especially from politicians who believe they contribute to economic inequality. But the simplest critique of the practice of buybacks can be made on economic grounds, in terms of value created or destroyed.

So much going on that by the time an article is prepared, everything has changed and it has to be scarpped. But, in any event, here is an attempt to summarize all that has happened in another turbulent overnight session.

Risk-taking in financial markets has gone on for too long. And the illusion that markets will remain liquid under stress has been too pervasive. But the likelihood of turbulence will increase further if current extraordinary conditions are spun out. The more one stretches an elastic band, the more violently it snaps back. Restoring more normal conditions will also be essential for facing the next recession, which will no doubt materialise at some point. Of what use is a gun with no bullets left?

At the open, Europe looked in the abyss, and with no help coming from China, it did not like what it saw: And then the answer came from the Swiss National Bank, which stepped in to prevent the collapse just as Europe was opening. Because seemingly out of nowhere, a tremendous bid came in to life the EURCHF, buying Euros (against the CHF and the USD) and selling Europe's last left safety currency. We now know that it was the SNB, the same central bank which is the proud owner of well over $1 billion in Apple stock.

We're gonna need a bigger rate cut...

SHANGHAI COMPOSITE HEADS FOR BIGGEST 3-DAY DROP SINCE 1996
CHINA CSI 500 STOCK-INDEX FUTURES FALL BY MAXIMUM 10% LIMIT

"It's time to wake up," because, the fate of the world is in the hands of illiterate Chinese farmers and Greek grannies.

• Chinese Stock Plunge Leaves State Media Speechless (BBG)
• China’s Market Selloff Accelerates (WSJ)
• Any Deal on New Greek Bailout Funds Put Off Until Weekend (WSJ)
• ECB keeps ELA funding limit for Greece unchanged for third day in a row (Reuters)
• Impoverished Greek City Stands With Alexis Tsipras (WSJ)
• Why It Won’t Be a Default If Greece Misses IMF Payment Next Week (BBG)
• Valeant Makes Takeover Approach to Zoetis (WSJ) - or how Ackman assures himself another good T+3 quarter
• Obamacare ruling puts Supreme Court on hot seat in U.S. presidential race (Reuters)

Moments ago we learned that none other than that ultimate "arbiter" on all things moral and ethical, Apple itself, entered the fray with a decision to remove all Civil War games from its App Store! According to MacRumors, "Apple has removed seemingly all Civil War games from the App Store for displaying the Confederate Flag in "offensive and mean-spirited ways," our sister website TouchArcade has learned. Apple has sent a removal letter to affected developers to inform them that their app does not comply with Section 19.1 of the App Store Review Guidelines."

- We need a free market in currencies, not bail-ins and a war on cash and gold - People blindly trust “experts” so welcome that some of them giving prudent advice regarding diversification - Currencies of creditor nations – Norway, Switzerland, Singapore, Hong Kong will outperform in long term

Collapse is not an event, it is a process.

• Greece Handed New Terms as Tsipras Approaches Decision Time (BBG)
• As U.S. Probes $12.7 Trillion Treasury Market, Trader Talk Is a Good Place to Start (BBG)
• Signs Swedish QE Backfiring as Liquidity Evaporates (BBG)
• ECB approves ELA funding requested by Greece- banking source (Reuters)
• Greek Millennials Can't Find Work But Actually Want to Keep the Euro (BBG)
• Greek deal or not, the euro is now a different beast (Reuters)
• Promoter’s Arrest Sheds Light on Cynk’s $6 Billion Surge (BBG)
• The World's Biggest Economies Are About to Feel the Impact of China's Slowdown (BBG)
• Senate Clears Trade Bill’s Way to Passage (WSJ)

Time for the musicians to learn the lessons that the video guys in Hollywood learned from them...

• Greek offer to creditors runs into angry backlash at home (Reuters)
• Tsipras Seeks to Stave Off Greek Defections Over Aid Plan (BBG)
• Austria finmin says no agreement on Greek proposals without concrete plan (Reuters)
• Another ELA raise, this time under €1 billion: ECB raises emergency funding for Greek banks (Reuters)
• Greek energy, foreign ministers divided on Russia gas deal (Reuters)
• China’s Plan for Local Debt Amounts to a Bailout (WSJ)
• Key Democratic senators back plan for trade legislation (Reuters)
• South Carolina Governor: Time to Furl Flag (WSJ)

• Mood brightens after latest Greek offer to creditors (Reuters)
• ECB's Nowotny - Greek banks have funding extension for today (Reuters)
• Any Greece deal must match party manifesto, minister says (Reuters)
• Greece says now up to lenders to move on an agreement (Reuters)
• Greece sends wrong documents to monitors... Again (FT)
• U.S. won't let Russia 'drag us back to the past': Pentagon chief (Reuters)
• Belgium unblocks part of Russian diplomatic missions’ frozen accounts (Tass)
• Fed Scoop Heralded Era of Closed Doors for $100,000 Newsletters (BBG)

Since the beginning of this year the markets have primarily treaded water. The primary support for the bulls has been continued acknowledgement by the Fed on an inability to remove accommodative policy by raising interest rates. (Which should make you question what happens the first time they do.) The bears have been feasting on weak economic data and deteriorating fundamentals.

Ronald Reagan is surely rolling in his grave. He is credited for much that he didn’t actually accomplish on the economic front, but his most singular real victory - decisive repudiation of the Keynesian macro-economic policy model that had produced stagflationary havoc for more than a decade - overshadows all his fiscal failures and the urban legend that he actually tamed Big Government. Needless to say, however, that 35-years ago repudiation has now been itself completely repudiated by the keynesian apparatchiks who presently rule the Eccles Building. This week Janet Yellen was at it again, displaying outright contempt for the Gipper’s crowning achievement.