While the euro crisis seems far away as all Eurozone countries ran government deficits below 3 percent of GDP, there is one problem for the euro that quietly keeps growing: the unresolved banking crisis. And this is not a small problem...
"...in an environment in which the Middle East views conflicts as zero-sum games, China is likely to find it increasingly difficult to remain aloof and straddle both sides of the fence. Salvaging the Iranian nuclear deal could come at a cost China may not want to pay."
"The real currency of this world is not backed by gold, nor by oil, nor by bureaucratic fiat, nor even by direct military might. No, the real currency of this world is narrative, and the ability to control it..."
The EB-5 program will not end well. It cannot be “fixed.” It is shot through with fraud. The honest course is for the SEC to admit that the program has mutated into a scam, even in ‘normal’ projects. The Chinese money should be returned to all investors who want it back.
"...the trigger for a crisis could be anything if the system as a whole is unstable. Moreover, the size of the trigger event need not bear any relation to the systemic outcome. The lesson is that policymakers should be focused less on identifying potential triggers than on identifying signs of potential instability."
"Central bankers and eurozone finance ministers have been balanced in their reaction to the mini-BoT proposal. Balanced, that is, between outrage and apoplexy..."
key economic releases this week are the minutes from the May FOMC meeting on Wednesday and the durable goods report on Friday. There are several speeches from Fed officials this week, including one from Chairman Powell on Friday
Steve Mnuchin said "we're putting the trade war on hold" and will be perceived as a positive - but the devil will be in the details. The real issues to solve are IP and services. Meanwhile, Mnuchin’s name is now high on the Trump deadpool list as White House staffers brief against him.
"We are putting the trade war on hold": all it took was 8 simple words, with little factual backing and no way of enforcement, to send global markets and US equity futures soaring overnight.
Since 1895, the Dow, using daily data, has spent just 4.32% of its time at “new highs.” The rest of the time, investors were simply making up previous losses...
"...citizens moving from these blue states to red states aren’t just abandoning political loyalties while they’re at it. They are still going to maintain their same beliefs in their new homes, which has caused some seemingly 'safe' red states to come into question."
