"Sanctions could lead to retaliatory action, and that would trigger a spiral with unforeseeable consequences," warns China's envoy to Germany adding that "we don't see any point in sanctions." On the heels of Merkel's warning that Russia risked "massive" political and economic damage if it did not change course, Reuters reports ambassador Shi Mingde urged patience saying "the door is still open" for diplomacy (though we suspect it is not) ahead of this weekend's referendum. Russia's Deputy Economy Minister Alexei Likhachev responded by promising "symmetrical" sanctions by Moscow. So now we have China joining the fray more aggressively.
Merkel Warns Putin Of "Massive Damage", Russia Continues Piling Troops, Pro-Russia Oligarch Arrested, Gazprom SpeaksSubmitted by Tyler Durden on 03/13/2014 10:05 -0400
It's crunch time for Ukraine.
"Europe faces 25 years of Japan-style stagnation," warns George Soros in this brief Bloomberg TV interview, adding that without deeper integration, "it’s an incomplete association of nations and it may not survive." While claiming that the financial crisis may be over they now "face a political crisis," with the voluntary association cracking due to the creditors (Germany) being in charge. However, he hopes "Ukraine is a wake-up call to Europe, because Russia has emerged as a rival to the European Union." Putin, Soros worries, "has a very different idea of what a society should be like... he has a blind spot - he believes people can be manipulated and cannot resist." That's not the case according to Soros, who exclaims "people do believe in freedom."
At the onset of the derivatives collapse in 2007/2008 it would have been easy to assume that most of America was receiving a valuable education in normalcy bias. As much as we are for people waking up to the nature of the crisis, there comes a point when those who are going to figure it out will figure it out, and the rest are essentially hopeless. The cultism surrounding the U.S. economy and the U.S. dollar is truly mind boggling, and by “cultism” we mean a blind faith in the fiat currency mechanism that goes beyond all logic, reason and evidence.
Globalization is certainly at the heart of what it means to become a trading partner with another country. I’ll scratch your back if you scratch mine. But, what happens when the itching continues or the scratcher starts scratching himself in an unlikely place rather than where he’s supposed to?
As is widely known, Ukraine's acting post-coup PM Arseniy Yatsenuk is currently in the US and holding heating talks with president Obama on just how to define the "costs" to Russia should Putin conclude his annexation of the Crimea this weekend in a way that the Russian leader will finally pay attention. As was less known, after his meeting, at 8 pm tonight, the PM was supposed to hold a press conference at the National Press Club. As of moments ago, this propaganda meet and greet has been cancelled.
- DUE TO A SCHEDULING CHANGE, THE PRIME MINISTER HAS CANCELED THIS EVENT
Scheduling change? Really? Did Yatsenyuk ask Obama, in passing, to show him where the Ukraine gold, which as we reported a few days ago was rumored to have been airlifted to the NY Fed, which resulted in a less than pleasant response by the US president?
The G-8(-1) is clearly concerned about the fall-out from this weekend's referendum in Crimea and in its strngest language yet is condemning (and threatening) Russia:
- *G-7 CALLS ON RUSSIA TO 'DE-ESCALATE THE CONFLICT IN CRIMEA'
- *RUSSIA ANNEXATION OF CRIMEA WOULD VIOLATE UN CHARTER: G-7
- *G-7 CALLS ON RUSSIA TO HALT SUPPORT FOR CRIMEA REFERENDUM
- *G-7 SAYS WILL NOT RECOGNIZE RESULT OF CRIMEA REFERENDUM
- *'CEASE EFFORTS TO CHANGE' STATUS OF CRIMEA, G-7 TELLS RUSSIA
- *G-7 SAYS ANNEXATION OF CRIMEA WOULD HAVE 'GRAVE CONSEQUENCES'
Then, after the threats, calls on Russia to let observers into the country and enter into talks with the Ukrainian government (which has already appeared to give up on Crimea). This comes as Ukraine's PM visits Obama in D.C.
It should now be evident that America's foreign policy is to an extent being driven by our banking mess. Again and again, we see Washington, including Wall Street's handmaiden, the Fed, exporting monetary chaos implicitely in order to weaken the status of potentially competing reserve currencies. Until democratic governments around the world become strong enough to counteract the power of the plutocrats by taxing them, both their income and their wealth (as Sweden does) the revolving looting of sovereign governments and demolition of middle classes by the plutocrats and their corporations will continue.
3,000 Americans around the world renounced their citizenship last year. CNN Money introduces us to five U.S. citizens who have given up their passports -- or are thinking about it...
Let's be clear about one thing (to quote the president): the Fed's policies have been an unqualified success for financiers and an abject failure for everyone who has to work for a living. The Fed has not just failed to rectify the nation's obscene inequality in wealth and income; it has actively widened it by handing guaranteed returns to the banks and financiers while strip-mining what's left of the middle and working classes' non-labor income, i.e. interest on savings.
Diplomacy Fails In Ukraine: Putin Slams Kerry Plan, Kiev Issues Ultimatum, Crimea Suspends All Non-Moscow FlightsSubmitted by Tyler Durden on 03/11/2014 08:01 -0400
While it may have been pushed back from the front pages to keep confidence high, things in the Crimea, and in Ukraine in general (which may or may not waved goodbye to its gold reserves) are going from bad to worse with every passing day, with the near term catalyst of course being this Sunday Crimean referendum vote, which seems like a done deal, and which will give Russia a carte blanche to annex the territory over the howls of protest from Ukraine's coup government, and the west of course.
How much faith can we put in our ability to decipher all the numbers out there telling us the US is closing in on its cornering of the global oil market? There’s another side to the story of the relentless US shale boom, one that says that some of the numbers are misunderstood, while others are simply preposterous. The truth of the matter is that the industry has to make such a big deal out of shale because it’s all that’s left. There are some good things happening behind the fairy tale numbers, though—it’s just a matter of deciphering them from a sober perspective.
For those who have been following every twist and turn of the Ukrainian political crisis ever since its start in November of last year, the following post is likely a recap of familiar facts and dates. For everyone else, or those who just wish to plug the occasional hole in their memory, here is a full timeline of events that led to the coup that replaced the elected president Yanukovich - despite the signing of an agreement memorandum which was endorsed by Europe and the West keeping him in power and calling for presidential elections - with an acting president who has been classified as illegitimate by Russia, in exchange for which, as well as for numerous other reasons, Moscow has completely occupied the Crimea and increasingly more cities in east Ukraine are telegraphing their alliance with Putin.
European sovereign bond spreads have not batted an eyelid during the recent Russia-Ukraine crisis... and why should they, Draghi will do "whatever it takes." Even HY credit in Europe is holding up - despite an ugly squeeze wider on Friday (chatter that positioning in very long credit). But with Europe's VIX above 20, the broad European stock index is now below pre-Putin levels. What is perhaps most stunning is that while investors have piled out of German, Swiss, and French stocks in the last few days, they have backed-up-the-truck in "new normal" safe-haven Portugal. The reason proferred by some - Portugal is further from Ukraine (and less dependent on Russia's gas) - which of course is the critical swing factor for an economy that remains crushed aside from trade with Germany.
"It's the weather" That's all Abe has left to pretend that 'recovery' is right around the corner. Japan just printed its worst current account deficit on record and its worst GDP growth since Abenomics was unveiled - both missing by the proverbial garden mile and both confirming that all is not well in Asia. As for the perpetual hope of a J-curve (or miracle hockey-stick reversal)? There won't be one! As Patrick Barron noted, "monetary debasement does not result in an economic recovery, because no nation can force another to pay for its recovery."And the latest joke from Asian trading floors: "when asked what he thought of the recovery, Shinzo Abe responded "Depends!""