United Kingdom

One month ago we showed that when it comes to the cost of basic (and not so basic) health insurance, the US is by far the most expensive country in the world and certainly among its "wealthy-nation"peers. It would be logical then to think that as a result of this premium - the biggest in the world - the quality of the healthcare offered in the US among the best, if not the best, in the world. Unfortunately, that would be wrong and, in fact, the reality is the complete opposite: as a recent study by the Commonweath Fund, looking at how the US healthcare system compares internationally, finds, "the U.S. fails to achieve better health outcomes than the other countries, and as shown in the earlier editions, the U.S. is last or near last on dimensions of access, efficiency, and equity." In other words: most expensive, yet worst in the developed world.

Following the initial de-dollarization meeting, there has been a slew of anti-dollar moves around the world (including Gazprom's shift of 90% of its clients to non-dollar payments). However, on the heels of the "anti-dollar alliance" discussions yesterday, DW reports that China would start direct trade between the renminbi and the British pound on Thursday. China's Foreign Exchange Trade System (CFETS) confirmed Sterling and yuan would be directly swapped without using the US dollar as an intermediary.

This week brings some key events and releases in DMs, including US FOMC (Goldman expects $10bn tapering, in line with consensus), IP, CPI, and Philly Fed (expect 13.5), EA final May CPI (expect 0.50%), and MP decisions in Norway and Switzerland (expect no change in either).

Volatility is depressed, micro dominates and as Goldman notes several of the key emerging themes of the last few years have lost their discovery value. There are many questions that investors should be asking as the second half of 2014 approaches (and the much hoped for 'recovery' picks up steam); but perhaps the most important one given the taper is "In a sea of liquidity, what happened to all the liquidity?" The supply of stock and volumes are down. Did you know Verizon’s current market cap is larger than Russia’s float?

First Italy, then Britain, and now Spain has decided that the key to reducing its debt-to-GDP ratio is not fiscal responsibility, growth, inflation, or restructuring but simply changing the denominator to better reflect reality - in other words, as El Pais reports, Spain is putting an official number on its sex trade and therefore juicing GDP. Prostitution, which is in legal limbo in Spain, is expected, according to revised figures released by the INE on Thursday Spanish GDP increases by between 2.7% and 4.5% after illegal activities such as prostitution, drug trafficking and smuggling are included. The Spanish government is undertaking a sexual services survey to better understand the industry...

Promises, promises! We’ve heard it all before. ‘We’re gonna get you, guys’. We know the song it’s just the words that get changed from time to time, but anyone can hum along to it these days. The bankers, those banksters are gonna get their comeuppance. Trouble is: they never do. It’s just getting boring now.

Anyone reading the regular Federal Open Market Committee press releases can easily envision Chairman Yellen and the Federal Reserve team at the economic controls, carefully adjusting the economy’s price level and employment numbers. The dashboard of macroeconomic data is vigilantly monitored while the monetary switches, accelerators, and other devices are constantly tweaked, all in order to “foster maximum employment and price stability." The Federal Reserve believes increasing the money supply spurs economic growth, and that such growth, if too strong, will in turn cause price inflation. But if the monetary expansion slows, economic growth may stall and unemployment will rise. So the dilemma can only be solved with a constant iterative process: monetary growth is continuously adjusted until a delicate balance exists between price inflation and unemployment. This faulty reasoning finds its empirical justification in the Phillips curve. Like many Keynesian artifacts, its legacy governs policy long after it has been rendered defunct. 

On June 6, 1944, Allied forces from the United States, United Kingdom and Canada launched the largest seaborne invasion in history by landing nearly 160,000 troops on the beaches of Normandy in a single day...

This week's busy calendar starts off with today’s global PMIs and ISMs. On Tuesday, President Obama begins a four day European trip ahead of the G7 meeting which starts on Wednesday. This G7 meeting is replacing the G8 meeting that was originally scheduled in Sochi but was cancelled after Russia’s annexation of Crimea. Tuesday’s data docket is important with Euroarea data releases including inflation and unemployment expected to further cement the ECB’s resolve in easing policy come Thursday. Wednesday features the global services ISMs and PMIs. Other data releases scheduled for that day includes the ADP employment report, which will provide an important preview to Friday’s NFP, and US trade. The Fed releases its Beige Book on Wednesday too and the second estimates of Euroarea GDP will be published on Wednesday as well. Apart from the ECB on Thursday, we also have the BoE policy meeting.

Several days ago, we looked at the big picture of US immigration, presenting the place of origin of America's 40 million foreign-born residents. However, as is always the case with the US, focusing on the big picture at the national level ignores the nuances at the state level. The following two charts using Pew Research data, compiled by the WaPo, show the dramatic changes in the land of origin of US immigrants, beginning with 1910 when Germany was the primary driver of US-born residents, accounting for 18% of US immigrants, and proceeding through 2010, when Mexico has become the biggest source of foreign-born residents: the birthplace of 29% of all immigrants in the US.

• Vietnam, China trade accusations after Vietnamese fishing boat sinks (Reuters)
• SEC Set to Spur Exchange Trading (WSJ)
• Bank of Japan quietly eyes stimulus exit (Reuters)
• Japan Risks Low Growth Even as Easing Spurs Inflation (BBG)
• Hello Japan: Bond Market Message to Fed: Your 4% Rate Outlook Is Too High (BBG)
• Malaysia, UK firm release satellite data on missing MH370 flight (Reuters)
• Fighting rages in eastern Ukraine city, dozens dead (Reuters)
• Bad Credit No Problem as Balance-Sheet Bombs Rally 94%  (BBG)
• Draghi’s Asset-Backed Drive Rouses Academic Skeptics (BBG)
• For-Profit Colleges Face Test From State, Federal Officials (WSJ)

Below is a real-time tracker of the results from the elections as they come in. For anyone but the Euroskeptics, the results will hardly be pretty...

Yes, U.S. capital markets have officially gone "Full Seinfeld"; As ConvergEX's Nick Colas notes, Tuesday’s selloff over “Nothing” reversed higher Wednesday throuygh Friday for similarly non-specific reasons. So, today we will go a little further afield and talk about words and what they tell us about shifting societal priorities and norms. Wonder what the most commonly searched word might be on the Merriam-Webster website?  It is “Pragmatic”... which seems incredibly ironic given the total lack of pragmatism that appears to be shown in world markets.

Using espionage for gain in negotiations is an age-old tactic; but are the norms of 'appropriate' espionage changing?