Financial sources feeds
After the mysterious assassination of a well-known Palestinian engineer and academic in Malaysia over the weekend, Israel's defense minister issued a statement denying accusations that the Israeli spy agency Mossad was behind the killing.
Dr Fadi Mohammed al-Batash, 35, had been living with his family in Malaysia for the past ten years and was a university professor in the field of electrical engineering. Batash was further recently employed by the Energy Authority in the Gaza Strip and had long held a position as lecturer at the British-Malaysian Institute at the University of Kuala Lumpur, according to Israel's YNet news. Israeli officials have recently accused him of being a rocket expert and downplayed his advisory work connected to Gaza's civilian infrastructure.
Multiple international reports indicate that as Batash made his way from his home in Kuala Lumpur to a nearby neighborhood mosque for dawn prayers sometime around 6am, a motorcycle drove by and two unidentified men unleashed a volley of ten shots, at least four of which hit Batash in the head and body, killing him on the spot.
Witnesses say the killers had European features.
Importantly, Malaysian authorities immediately classified the crime as a "targeted assassination" as others had been present at the scene but only Batash was killed. Security cameras had reportedly captured footage of the killing, and police say they have evidence that the killers had followed the Palestinian scientist for up to twenty minutes beforehand.
Hamas immediately claimed the victim as one of their own, calling him a "martyr" but stopping short of directly pointing blame at Israeli intelligence. However, Hamas affiliated media groups did make the accusation along with Batash's own family, who issued a statement saying, "We accuse the Mossad of being behind the assassination."
Israel's YNet news described the murky circumstances behind the assassination based on local police reports:
According to Malaysian media reports, the assassins, who were described by witnesses as "white men" with "European features," were driving a powerful BMW 1100cc motorbike. Security camera footage showed they waited for Albatsh for 20 minutes until he arrived at the scene.
"Preliminary investigations found four gunshot wounds on the victim's body. Two bullet slugs were found at the scene of the incident," Kuala Lumpur police chief Mazlan Lazim said in a statement.
The police said it believes "this was a targeted killed and not a terror attack, because there were other people at the scene but the assassins focused only on (al-Batash)."
Israeli officials were quick to point to Palestinian factional infighting as the likely reason for the killing.
And Defense Minister Avigdor Lieberman emphasized Batash's role in engineering Hamas rockets, telling Haaretz: "He wasn't involved with improving the electricity grid or infrastructure and water. We have heard the announcements by the heads of the Hamas taking responsibility for the man, explaining he was involved with the production of rockets, with improving the rockets' accuracy."
Lieberman added further, "A settling of scores among terrorist organizations, among terrorists, among various factions, is something that we see from time to time. I assume that's also what occurred in this case."
Meanwhile, Palestinian activists have pointed to a long history of Israeli assassinations of Palestinian, Iranian, and Syrian scientists, engineers, and notable figures living abroad.
One recent instance involved a Tunisian drone expert who was accused of designing weaponized drones for Hamas. His bullet-riddled body was found in his car near his home in Sfax, Tunisia in 2016. Some of the evidence left behind included rental cars and guns equipped with silencers.
Another notable headline grabbing operation, reportedly by Mossad agents, occurred in 2010 and resulted in the assassination of a top Hamas commander who had checked into a high end Dubai hotel after flying from Syria.
An eleven man Israeli hit squad had entered the hotel while dressed in tennis gear and carrying tennis rackets, and were later reported to be traveling on fake Irish and French passports. After conducting surveillance the Mossad agents got Hamas' Mahmoud al-Mabhouh to open his hotel room door and quickly suffocated him without arousing suspicion from other hotel guests. By the time the body was discovered, the assassins had flown out of Dubai to various locations around the world and were never seen again.
And in 2015 a secret document revealed by The Intercept as part of the Edward Snowden leaked NSA archives confirmed that Israeli agents had assassinated a top Syrian general and personal aide to President Assad in 2008 while the general dined at his family home near Tartus, along the Syrian coast.
The daring operation involved Israeli naval commandos and snipers targeting Gen. Muhammad Suleiman's house from the waters of the Mediterranean and shooting him in the head and neck. Israel considered him responsible for coordinating weapons and supplies between Iran and Lebanese Hezbollah, as well as overseeing an alleged nascent nuclear development program at Syria’s Al Kibar facility which had previously been bombed by Israeli jets.
And six months prior to Syrian General Suleiman's murder, a top Hezbollah officer was killed by a joint CIA-Mossad operation in the heart of Damascus. According to former intelligence officials who confirmed the assassination plot to the Washington Post, a car bomb planted near a Damascus downtown restaurant instantly killed Imad Mughniyah - Hezbollah's international operations chief who was believed to have masterminded several terror attacks targeting Americans.
So in spite of Israeli officials' current vehement denials, recent history suggests that Malaysian-based Fadi al-Batash's targeted killing was very likely yet another Mossad or other allied intelligence service hit.
Julian Assange's twitter account has started tweeting again, but not because Ecuadorian authorities have restored his access to the Internet. Instead, his Twitter account has been taken over by a group of supporters leading the campaign to #ReconnectJulian.
In late March, the Ecuadorian government decided to suspend Assange's Internet access due to his controversial tweets in support of Carles Puigdemont, the Catalan leader who had been detained in Germany. Ecuador's new government, according to RT, was facing intense diplomatic pressure from its European ally, Spain.
Assange's supporters announced their takeover in a tweet:
Julian Assange has been gagged and isolated from visitors and communications after heightened pressure. This is on top of his six years without access to sunlight and arbitrary detention in violation of two UN rulings. Account now run by his campaign. https://t.co/cbM33Ng42C pic.twitter.com/LLeERI5knj— Julian Assange ⌛ (@JulianAssange) April 23, 2018
Here’s a translation of a statement released by the government of Ecuador late last month when it decided to suspend Assange's Internet access, phone access and ability to receive visitors because Assange had refused to stop commenting on the political affairs of other nations.
The Government of Ecuador suspended the systems that allow Julian Assange to communicate with the outside world from the Ecuadorian embassy in London, where the citizen remains in an international protection situation for six years due to the risk to his life and integrity.
The measure was adopted in the face of Assange’s failure to comply with the written commitment it assumed with the Government at the end of 2017, for which it was obliged not to issue messages that implied interference with other States.
The Government of Ecuador warns that the behavior of Assange, with its messages through social networks, puts at risk the good relations that the country maintains with the United Kingdom, with the rest of the States of the European Union and other nations. Therefore, to prevent potential damage, the embassy in London interrupted this March 27 communications abroad to which Assange has access.
The Executive also keeps open the way to the adoption of new measures in the face of breach of commitment by Assange.
Shortly after the statement was released, supporters of Assange gathered in front of the embassy in London where they stood in solidarity for hours.
In the weeks that followed, the campaign to restore Assange's Internet access has picked up many high-profile supporters including Brian Eno, former Greek finance minister Yanis Varoufakis, journalist John Pilger and Noam Chomsky; a petition demanding an end to Assange's isolation has garnered more than 65,000 signatures.
Assange has been living in the Ecuadorian embassy in London since he sought asylum there in 2012. Assange entered the embassy to avoid extradition to Sweden which had wanted him for questioning in regard to an alleged sexual assault. Assange feared that if he was brought into custody in Sweden, it would only be a matter of time before he was extradited to the US, where he would face charges over Wikileaks' publishing of US diplomatic cables and other sensitive information, per RT.
Ecuador had granted him citizenship in December in a failed attempt to allow him to leave under diplomatic immunity. However, Ecuador's new president, Lenin Moreno, is less sympathetic to Assange's cause, considering him an "inherited problem" from the government of Rafael Correa.
The fate of Assange will become an especially sensitive issue once former CIA director Mike Pompeo, with whom Assange has repeatedly clashed, becomes Trump's new Secretary of State following his imminent confirmation.
Submitted by Bill Blain of Mint Partners
“Time you straighten right out, better think of the future, else you’ll wind up in jail.”
This morning we are all “cautiously optimistic”, apparently
The world reminds me of a duck: Serene and calm(ish) on the surface. Paddling furiously under the water. That’s one way to picture the current round of geopolitical manoeuvring across Asia: China-Japan, US-Korea, China-US dialogs. Forget the Trump noise, but these discussions are likely to lead to new dynamic across Asia.. If the outcome of the current games are as positive as we expect/hope, then the prospects for the global economy are pretty solid. Ducks can pivot on a heart-beat! Over the next 10-years or so we expect to see South-East Asia’s middle classes grow from around 600mm to over 2 billion – that’s an enormous market to sell into. It will be ripe with opportunity – and we have ideas, but not without challenge.
Much of what we see on the news, and read on the wires is just NOISE. It’s getting more confusing as twitterfeeds, fake-news, and rogue media provide more information than analysts can analyse to strip facts from the sturm-et-drang of “click-bait”. Noise can cause markets to go up, down, sideways and shake-it-all-about – but within the noise are clear trends. Some negative, some positive. Much to our surprise – like what’s happening in Asia -some of the noise is far more positive than we expected!
This morning I’m tempted to check some of the stuff I’m reading about Macron.. comparing himself to Trump seems a mistake of the first-egg, but hey-ho! As for the UK – the less said about our sorry excuse for government.. the better. They’ve dug themselves into a horrible mess over Windrush…. But I’m afraid it could get worse. As the blame game deepens, the Conservatives unerring ability to do the wrong thing is coming to the fore. Apologise Now! Put right the wrongs that have been done to our citizens, and then do the decent thing by resigning. End of.
Noise can be the small stuff – like an article that flashes up quoting a “reputable” investment manager trashing the outlook for a particular stock. It gets whooshed round the market as “click-bait”: with everyone reading it, sagely agreeing and the stock plummets. Few folk bother to check the facts: that the article first appeared in some meaningless rag somewhere obscure, or the supposedly “reputable” investor actually runs a $100k “hedge fund” from his garage. Its news and views and gets read no matter how wrong it is. (Sorry if this reads like Fake-News 101 to millennials who understand modern media..!)
At the other end of the scale is Big Noise. A good example is Oil. We’ve collectively bought into three big arguments over the past few years: i) the collapse of the oil monopoly (the increasing irrelevance of OPEC), ii) the US becoming the swing producer likely to constrain prices when shale/fracking kicks in at, say, £50. iii) Oil is no longer such an important commodity as the big carbon shift continues. Our conclusion was oil prices are likely to remain lower into perpetuity. That ignores the dynamics– we’ve absorbed most of the floating oil glut of excess stocks, demand is rising in line with economic growth and cheap oil, the swing producer is more than happy to produce, and the dynamics of Russia/Saudi oil have surprised us by becoming a fixed market feature. Folk need Oil. Higher oil prices, and a good example of how the NOISE led most of us to expect something utterly different.
Which leads us to this morning’s conundrum – where are markets going? We have two things worrying us:
- Stock Markets look due a correction – they’ve wobbled along this year, and the noise from pundits saying they look overvalued and need a price correction is thunderous. Yet, we’ve still got solid company results coming in, and an economic environment that feels solid (although more tenuous to perceive 18 months down the road.)
- Bond markets remain overly tight – spreads between asset classes and risk look implausibly tight, get continue to ratchet in. At some point risk vs return has to be considered, yet default rates remain low.
We’re all aware why markets are so tight. Too much money chasing assets as a result of unconventional monentary policy – QE? (I still reckon there is an enormous bill coming our way when we experience the unintended consequences and lashback of QE – but that’s a story for another morning….) Or is due to yield tourists rolling down the risk curve in search of higher returns in assets the don’t properly understand? Or is it the number of asset bubbles; like tech valuations, Fin-tech, cryptocurrencies etc that look ripe to burst?
All these things worry and concern asset managers. The big fear I’m hearing today is “liquidity” – what happens if we do get a market meltdown, bond and stock markets take a knock and we see the kind of market suspension we had in 2008? Investment managers will always tell you they are long-term investors – while keeping a time frame of a few days if markets look likely to go up/down (because that’s how their bosses measure them!).
Liquidity is whatever someone else is prepared to pay for your asset. In times of market dislocation its bound to be wide. Perhaps a better answer is not to worry about it – but choose the assets that are not only defensive, but most likely to simply get wet when the rains come and dry off quickly thereafter? Thinking back to the great bond rout of 2008 – most of the bonds that crashed far below 100 par as a result of liquidity being switched off, rose back very quickly as markets recovered.
Therefore: pick assets with duck like characteristics. They will get wet when the storm comes, but will shake their feathers remaining dry, warm and snug when the sun comes out again.. Not quite so sure about the legions of triple BBB issuers and inflated stock prices.. but…
And finally, my contribution to the “Click-Bait” world. Listening to my teenage nephews and nieces (plus my own millennials) at my parent’s Diamond Wedding party, I’m seriously worried about Facebook. They’ve already made up their minds… they understand stuff I just don’t….
Global stocks stumbled on Monday ahead of an avalanche of earnings in this season's busiest reporting week but the big story overnight was the spike in 10Y Yield which climbed as high as 2.9957%, the highest level since January 2014, and nearing the psychological 3% level which has triggered market spasms and more than one tantrum in the past. The move was catalyzed by Treasury Secretary Steven Mnuchin saying over the weekend that he is planning a trip to China, an indication the US is considering a truce in its trade war with China.
Citi's technical team repeats the key highlights, pointing out that we're 1bp away from the psychological 3% level in the Treasury 10y yield. "The benchmark is trading at levels not seen since 2014, and we are continuing to make fresh YTD highs. The 10s now trade at 2.99% while the 2s10s trades on the 51 mark."
If we break 3%, major levels come in here that extend up to 3.05%: this is the level where we have the 2014 high which is also the long term double bottom neckline and the long term channel top:
Not everyone is convinced that the 10Y will soar once it blows through 3% (especially not in a world which both the IMF and IIF said has record debt): "Ultimately it’s hard to see a move sustained above 3 percent on the U.S. 10-year,” Mitul Kotecha, a strategist at TD Securities, told Bloomberg TV from Singapore. “Some of the dialing down in tensions, in risk aversion, may be having some impact there as well as expectations of continued strong growth in the U.S.”
Meanwhile, rising yields are capping other risk assets and the recent sell off in Treasuries is being closely eyed by other markets, and supporting a pretty aggressive USD bid and VIX is rallying.
Mostly as a result of rising yields and a stronger dollar, S&P 500 Index futures turned lower, tracking moves in the Stoxx Europe 600 Index which failed to capitalize on an unexpected beat in the April PMI prints, while earlier the MSCI Asia Pacific Index also started off the week in the red.
In global stocks, MSCI’s world index fell 0.25% after Asia shed 0.5% overnight and Europe then slipped 0.2% as results from Switzerland’s biggest bank, UBS, disappointed. S&P futures also pointed to a modestly lower open.
Meanwhile, traders are on edge because in addition to earnings - more than 180 companies in the S&P 500 are due to report results this week, including Amazon, Alphabet, Facebook, Microsoft, Boeing and Chevron - traders also received the latest round of advance economic surveys that should show in the coming days if economic softness in the first quarter was just a passing phase linked to wintery weather and the Lunar New Year holidays in Asia. Readings from Japan, France and Germany were all relatively reassuring. Japan’s PMI data firmed as output and domestic demand picked up, France got help from its services sector, while Germany came in above forecast despite weaker new orders numbers.
- EU Markit Manufacturing Flash PMI (Apr) 56.0 vs. Exp. 56.6 (Prev. 56.6)
- EU Markit Services Flash PMI (Apr) 55.0 vs. Exp. 54.8 (Prev. 54.9)
- EU Markit Comp Flash PMI (Apr) 55.2 vs. Exp. 54.9 (Prev. 55.2)
“It’s a good reading, it’s still encouraging,” said Chris Williamson, chief business economist at IHS Markit, of the combined euro zone numbers, which he said pointed to quarterly GDP growth of 0.6 percent.
Helping the spike in yields is the recent sharp reversal/short squeeze in the dollar as the dollar; the BBDXY index gained a fifth day, rising 0.5% on Monday to the highest level since March 1, and is now up by 1.4% since Wednesday’s close, the most on a three-day basis since December 2016. In addition to the squeeze of near record dollar shorts, a "Europe-based trader" quoted by Bloomberg says dollar bids represent both unwinding of medium-term trailing stops and fresh positions, while another trader said that interbank names are seen selling the euro and the yen.
Elsewhere in FX, the EUR/USD slipped for a third day, down to a two-week low of 1.2226 while GBP/USD reversed an earlier gain to drop below 1.4000 handle as chances that the BOE may not move in May, together with renewed concerns over the Brexit front, weighed on pound sentiment. USD/JPY rose to trade above 108.00 for the first time since mid-February: option-related offers below that level capped for a while, before stops above the figure were filled. As Citi notes, some big levels have been broken in FX today:
- EURUSD is through Friday’s low at 1.2256 and is less than 30 pips away from the 100d MA at 1.2206.
- USDJPY has broken the 108 handle and now through 108.13. The reverse head and shoulders target of 109.36 looks feasible according to CitiFX Technicals.
- AUDUSD trendline comes in here at 0.7634 as we find fresh YTD lows.
- NZDUSD testing the 200d MA at 0.7185. From here, there are a few levels to eye with 0.71500 and 0.7111.
- USDCAD levels in 1.2720-80 including the 55d MA at 1.2767 seem to have been broken. Through 1.2800, there are plenty of levels from the March rally.
- USDNOK MTD highs are at 7.8990, and the 100d MA at 7.9284. EURNOK looks more mixed, with the 100d MA not until 9.6721.
- GBPUSD: The pair has broken through the 1.40 handle and looks like we could test the 100d MA at 1.3850. However GBP may stabilize against EUR here, with all the notable MA levels converging ahead.
It was a busy weekend in geopolitical news, with North Korea surprising the world on Saturday stating that it would immediately suspend nuclear and missile tests, scrap its nuclear test site and instead pursue peace and economic growth, a development which Trump quickly latched on to as evidence of yet another mission (nearly) accomplished. Additionally, talk of a trip by the U.S. Treasury Secretary to China also fueled hopes that the recent trade tensions between the world’s two biggest economies may be thawing.
In overnight central banks news, the Nikkei reported that the Bank of Japan has shown signs it is tapering its ETF purchases in order to trim what it sees as an outsize profile in the equity market. Meanwhile, BoJ Governor Kuroda said the Bank of Japan must continue very strong accommodative monetary policy for some time in order to
reach 2% inflation. However, he may not have the choice, as dark clouds continue to gather over the head of this boss and over the weekend, the approval of Japanese Prime Minister Shinzo Abe’s cabinet dropped in polls conducted by the Yomiuri and Mainichi newspapers to the lowest level since 2012.
Oil prices edged down in the cross-currents but were not far from their highest since late 2014. The market had wobbled on Friday when Trump tweeted criticism of OPEC’s role in pushing up global prices, but quickly steadied. Oil prices dipped in Monday trade with WTI down 0.6% at USD 68/bbl. In addition to echoes from Trump's anti-OPEC tweet, the modest weakness followed Baker Hughes reporting an increased rig count on Friday, which is now at its highest level since March 2015. The strengthening dollar is also weighing on gold with the yellow metal down 0.5% on the day. Some OPEC specific news coming from the Azerbaijani energy minister who says the country joining OPEC is not on the agenda.
It's a busy week (full preview to follow), with some of the key events as follows:
- French President Emmanuel Macron begins a three-day visit to the U.S. Monday
- U.S. manufacturing and services sector PMIs. Later this week: GDP and jobless claims.
- Earnings season continues. Among those reporting: Alphabet/Google, Amazon.com, Samsung and Credit Suisse.
- The European Central Bank has a rate decision on Thursday. Investors will watch for any sign that officials are preparing a shift in stimulus plans for their June meeting.
- Bank of Japan announces its latest policy decision Friday and releases a quarterly outlook report.
Bulletin Headline Summary from RanSquawk
- US 10 year treasury ticking towards 3.00% yield
- Upward pressure on the USD pushing down commodities
- Looking ahead, highlights include US existing homes sales, ECB’s Coeure and BoC’s Poloz
- S&P 500 futures down 0.2% to 2,667.25
- STOXX Europe 600 down 0.2% to 380.98
- MSCI Asia Pacific down 0.4% to 173.19
- MSCI Asia Pacific ex Japan down 0.5% to 564.10
- Nikkei down 0.3% to 22,088.04
- Topix down 0.02% to 1,750.79
- Hang Seng Index down 0.5% to 30,254.40
- Shanghai Composite down 0.1% to 3,068.01
- Sensex up 0.5% to 34,579.62
- Australia S&P/ASX 200 up 0.3% to 5,886.01
- Kospi down 0.09% to 2,474.11
- German 10Y yield rose 4.1 bps to 0.631%
- Euro down 0.3% to $1.2254
- Italian 10Y yield fell 0.3 bps to 1.524%
- Spanish 10Y yield rose 1.9 bps to 1.301%
- Brent futures down 0.5% to $73.66/bbl
- Gold spot down 0.7% to $1,327.23
- U.S. Dollar Index up 0.4% to 90.66
Top Overnight News from Bloomberg
- U.S. Treasury Secretary Steven Mnuchin said he’s considering a trip to China amid a trade dispute with Beijing that finance chiefs warn could derail the global economic upswing. Mnuchin said he’s “cautiously optimistic” of reaching an agreement with China
- President Trump tempered his optimism on North Korea on Sunday, saying that “only time will tell” how things turn out. U.S. lawmakers sounded skeptical about promises made by Pyongyang ahead of possible historic talks between the countries leaders
- North Korea will freeze nuclear and intercontinental ballistic missile launch tests from April 21, state-run media Korean Central News Agency said Saturday; The leaders of the two Koreas are set to hold their first summit since 2007 on Friday
- Approval of Japanese Prime Minister Shinzo Abe’s cabinet dropped in polls conducted by the Yomiuri and Mainichi newspapers over the weekend.
- French President Emmanuel Macron’s arrival in the U.S. kicks off a crucial week for European leaders in an uphill battle to convince Donald Trump to stay in the Iran nuclear deal
- “If conflict increases, there will be less growth, more inflation,” says Federal Reserve Bank of San Francisco President John Williams in an interview with El Pais published in Spanish
- Has an invisible hand stepped in to support the Indian sovereign bond market? Traders are abuzz with speculation over the identity of the buyer or buyers behind the $862 million of purchases Friday
- U.K. PM Theresa May’s inner circle thinks she could be forced to accept staying in the EU’s customs union because Parliament will reject her plan to withdraw from it when the issue comes to a vote in the House of Commons, according to one official. Such a move could trigger a challenge to May’s leadership from Brexit campaigners in the Conservative Party
- U.K. Chancellor of the Exchequer Philip Hammond has indicated a willingness to look abroad when he begins his search for a successor to Bank of England Governor Mark Carney
- Eurozone April Flash composite PMI 55.2 versus estimate 54.8
Asia equity markets began the week lacklustre after last Friday’s losses on Wall St where all majors declined on continued tech weakness and losses in Apple amid concerns regarding iPhone demand. However, overnight pressure was contained in the AsiaPac region amid a further improvement of the geopolitical climate in the Korean peninsula after North Korea announced it will stop nuclear and ICBM testing, as well as begin dismantling a nuclear test site in the north of the country. ASX 200 (+0.3%) and Nikkei 225 (-0.3%) were mixed with weakness in Japan the result of last week’s flows into JPY. Elsewhere, Shanghai Comp. (-0.1%) and Hang Seng (-0.5%) were choppy amid a lack of drivers and a neutral position by the PBoC which injected CNY 80bln via reverse repos to match maturing operations, although underperformance was observed in Hong Kong names. Finally, 10yr JGBs were lower amid spill over selling from USTs and as yields tracked the upside in their US counterparts, in which the US 10yr yield printed its highest since January 2014. PBoC injected CNY 80bln via 7-day reverse repos for a daily net neutral position.
Top Asian News
- Sudden Modi-Xi Meet Signals Diplomatic Thaw Between Neighbors
- Bond Traders in India Hope Mystery Buyer Is the Central Bank
- Ping An Good Doctor Aims to Raise as Much as HK$8.8b in IPO
- Noble Group Board Becomes Battleground as Goldilocks Fights
- New Hong Kong Tech Darling Hawks IPO With Rare Valuation Metric
European equities opened on the back foot this morning (Eurostoxx 50 -0.2%) following the dampened tone from Asia. Switzerland’s SMI is underperforming as index heavyweight UBS (-3.1%) lags following earnings. Sector wise, consumer staples underperform while Reckitt Benckiser (-2.2%) are at the bottom of the FTSE 100 following a downgrade at Raymond James and a target price cut at JP Morgan. In terms of stocks specifics, Fresenius (+0.6%) shares are higher following the terminations of the Akorn merger amid data breaches. Fresenius Medical (-3.6%) is at the foot of the DAX 30 following a revenue target cut for this year. Capita (+10.1%) is the best performing in the Stoxx 600 following earnings and reports the company is to raise GBP 701mln in a 3 for 2 rights issue entirely underwritten by Citigroup and Goldman Sachs.
Top European News
- May Is Said to Face Cabinet Pressure Over Brexit Customs Union
- Poland Shatters Fragile Peace With Its Jews After Holocaust Law
- Euro-Area Economy Stays in Lower Gear as Order Growth Weakens; German Growth Momentum Rebounds After First-Quarter Slowdown
- How China Bought Up A Swath of Europe When Nobody Was Looking
In FX, firmer US rates are certainly fuelling the latest Dollar revival and the Greenback’s broad gains, but latest conciliatory noises from NK on the nuclear front are also undermining the traditional safe-haven currencies. The index is now comfortably above 90.500 and 90.600 resistance, looking at 90.750 next. JPY/EUR: Both on the brink of breaking out of recent ranges, with Usd/Jpy up through 108.00 offers, a big barrier and resistance extending to 108.20, but capped just ahead of stops reportedly lying between 108.25-30, while Eur/Usd has breached last Friday’s 1.2250 low having failed to reach 1.2300 in wake of better than forecast Eurozone flash PMIs, and is now also below the next downside technical support level at 1.2235, eyeing 1.2200. CAD: Usd/Cad looks is revisiting 1.2800+ on the aforementioned supportive Greenback narrative and contrasting Loonie weights in the form of last Friday’s CPI data and a still cautious BoC, although latest NAFTA reports indicate a deal could be reached in early May. The range has been 1.2750-1.2805, and the recent peak is circa 1.2820 (February 9). GBP: Losing traction around the 1.4000 level after last week’s heavy losses on a mixture of UK data misses and dovish or less hawkish BoE policy guidance from Governor Carney. Looking to test chart support around 1.3960 while Eur/Gbp is nudging up towards the high of a 0.8745-75 range.
In commodities, oil prices dipping in Monday trade with WTI down 0.6% at USD 68/bbl. This follows Baker Hughes reporting an increased rig count on Friday, which is now at its highest level since March 2015, suggesting increased US production putting downward pressure on the fossil fuel, as well as tweets from the US President suggesting oil is “artificially high” due to OPEC. The strengthening dollar is also weighing on gold with the yellow metal down 0.5% on the day. Some OPEC specific news coming from the Azerbaijani energy minister who says the country joining OPEC is not on the agenda.
Kicking off the week today will be the flash April PMIs due to be released in Europe and the US. Other data worth flagging is US existing home sales data for March. Away from that French President Macron is due to begin a three-day visit to the US, while the ECB's Coeure is scheduled to speak in the afternoon. UBS and Google are the earnings release highlights.
US Event Calendar
- 8:30am: Chicago Fed Nat Activity Index, est. 0.3, prior 0.9
- 9:45am: Markit US Manufacturing PMI, est. 55.2, prior 55.6
- Markit US Services PMI, est. 54.1, prior 54
- Markit US Composite PMI, prior 54.2
- 10am: Existing Home Sales, est. 5.55m, prior 5.54m; MoM, est. 0.18%, prior 3.0%
We wonder whether this week will finally host the 10 year Treasuries at 3% party? The sell off continued on Friday with yields closing at the highs for the session at 2.96% (+5bps) - the highest since January 2014. This was in spite of a Trump tweet bomb where he accused OPEC of artificially driving up prices. This morning in Asia, yields have crept up another c1.5bp and edging us closer to this landmark. Elsewhere equities are trading mixed with the ASX200 up 0.42% while the Nikkei (-0.30%), Kospi (-0.19%) and Hang Seng (-0.36%) are down as we type. Datawise, Japan’s April Nikkei manufacturing PMI firmed 0.2pts mom to 53.3.
Back to yields, in terms of what might attract us or repel us to the 3% mark we have a busy week with the ECB and BoJ holding policy meetings and the latest flash PMIs out around the globe today as well as a first look at Q1 GDP in the US. European PMIs in particular will be closely watched given the recent sharp deceleration.
With regards to the two big central bank meetings this week the ECB (Thursday) is the more interesting. While no change in policy is expected all eyes will be any hints or signs that officials are preparing the ground for an announcement in June that stimulus is to come to an end by the end of the year. Weaker data of late and some slightly dovish ECB commentary perhaps means that risks are tilted to the downside so the market will likely be on the watch in Draghi's press conference. Ahead of this today sees the flash PMIs. In Europe the consensus is for a continued moderation with the manufacturing print expected to nudge down another 0.5pts to 56.1 (which would be the lowest since February 2017) and the services a more modest 0.3pt decline to 54.6. European data surprises have been hovering at multi-year lows of late so Europe could do with some stabilisation soon to avoid stoking fears of a sharper downturn. It’s possible that the easing trade war tensions and healthier sentiment in the last week or so won’t yet be in these numbers though.
In terms of earnings this week, 181 S&P 500 companies are scheduled to report including some of the big tech heavy hitters like Google (today), Facebook / eBay / Twitter (Wednesday), Microsoft / Amazon / Intel (Thursday). Also worth highlighting are earnings reports from Verizon, Caterpillar and Coca-Cola on Tuesday, AT&T and Boeing on Wednesday and Exxon Mobil and Chevron on Friday. Earnings season also picks up in Europe with 121 Stoxx 600 companies reporting including the likes of UBS today, Credit Suisse on Wednesday and Volkswagen, Total and Royal Dutch Shell on Thursday.
Last but by no means least, the big political event this week is likely to be the summit held between South Korea President Moon Jae-in and North Korea Leader Kim Jong Un in the demilitarized zone between the two countries on Friday. Over the weekend, President Trump seemed to have softened his expectations as he tweeted “we’re a long way from conclusion on North Korea….only time will tell”. Away from that, French President Macron is due to travel to the US on Monday for three days and is scheduled to meet US President Trump on Tuesday. German Chancellor Merkel is also due to meet Trump on Friday.
Turning to trade, tensions appeared to have eased further over the weekend as the US Treasury Secretary Mnuchin said he’s “cautiously optimistic” on reaching a trade agreement with China and that “a trip (to China) is under consideration”, but declined to comment on potential timing. On the other side, China’s Ministry of Commerce said it would welcome such a visit. Elsewhere, the PBOC’s Governor Yi reiterated that the recently announced measures to open up China’s financial sector will be “implemented either in the next few months or by the end of this year”. Finally, the Russian Finance Minister Siluanov has met with Secretary Mnuchin and sought “clarifications” on the US sanctions, without elaborating more.
Now recapping other markets performance from Friday. US bourses weakened further, weighted down by tech and consumer staples stocks (S&P -0.85%; Dow -0.82%; Nasdaq -1.27%). The VIX rose for the third straight day to 16.88 (+5.8%) while the Stoxx 600 was marginally lower. In FX, the USD index gained for the fourth consecutive day (+0.42%) while the Euro and Sterling fell -0.46% and -0.62% respectively. WTI oil edged up 0.10% to $68.40/bbl on Friday.
Elsewhere, European government bonds firmed and partly reversed Thursday’s losses with yields on 10y Bunds and OATs both down c1bp while Gilts outperformed (-4.1bp), partly due to BOE Governor Carney’s dovish talk on a potential rate hike in May. Notably, the Bloomberg implied odds of a May rate hike in the UK fell 31ppt to 46% on Friday.
Moving onto central bankers speak. The Fed’s Williams reiterated that it makes sense to keep raising rates through next year given an improving economy and noted that if growth slows, the USD could get “dramatically stronger”. In Europe, the ECB’s Villeroy said the greatest medium term risk is “incontestably protectionism”. He added that if tariffs increased by 10% and became the norm, then “global GDP could decrease by at least 2%”. Elsewhere, Bloomberg cited unnamed sources which noted the ECB see scope to wait until their July meeting to announce their plans on ending QE, in part to allow more time to judge the impacts of the recent economic slowdown.
In the world of DB Research, our US economists find that if the Fed continues to raise rates according to their forecast and the term premium does not recover, the yield curve would invert by the end of 2019, potentially as early as June of next year. However, several factors, including higher inflation and the unwind of central bank balance sheets, should help lift the term premium and delay an inversion. Overall, they argue that because a low term premium has contributed to the flat yield curve, the negative signal from the yield curve should be discounted some. However they acknowledge that the growth negative signal from the yield curve could build by the time we get to 2020.
Before we take a look at today’s and this week’s full calendar, we wrap up with other data releases from Friday. The Euro area’s April consumer confidence was above market and rose 0.3pts mom to 0.4 (vs. -0.1 expected) – the highest since January which was the two decade high. Elsewhere, Germany March PPI was slightly below expectations at 0.1% mom (vs. 0.2% expected), leading to an annual growth of 1.9% yoy.
A look at the day ahead: kicking off the week today will be the flash April PMIs due to be released in Europe and the US. Other data worth flagging is US existing home sales data for March. Away from that French President Macron is due to begin a three-day visit to the US, while the ECB's Coeure is scheduled to speak in the afternoon. UBS and Google are the earnings release highlights.
From Bloomberg macro commentator, Richard Breslow
The Markets Are Speaking and No One Is Listening
It almost never works out when commentators assure us this week or next week will be the big one. All will be revealed. Then we move on to the next hugest event. Which goes to show, with many exceptions, that it’s usually the surprises that pack the most bang for the buck. They haven’t been analyzed to death with all the reasons at the ready to explain any deviations from forecast to be trotted out. If there wasn’t weather, we’d have to invent it.
So, fully aware that I’ll no doubt regret it, we are in for a very interesting patch. With, as far as I can see, an awful lot of traders ignoring the price action in favor of the preferred narrative. And resolutely positioned against what seems the pull of the tides. An unusually resolute stance in a year when things have been going merely so so for asset managers. I can only surmise that being “flexible” hasn’t worked to plan so traders are choosing to stand their ground. Good luck with that.
There’s no arguing that the world has plenty of problems to go around. But the not even dead-cat bounce in equities, emerging markets or the likes of the Australian dollar from headlines about Treasury Secretary Mnuchin considering a trip to China to work on trade differences and China cautiously welcoming the gesture shouldn’t be ignored. Positioning is working against traders right across the board. And looking at the charts, stale positions, which are growing not shrinking, are not on the side of the path of least resistance.
Take CFTC positioning with a grain of salt. Especially if you only look at the top line. But it struck me that with all the news flow, geopolitical and relative monetary policy related, the dollar short position increased last week. Yet you don’t have to be a dollar bull to wonder why. The dollar index isn’t out of the woods, but support levels look a lot clearer than resistance. The more inclusive Bloomberg dollar index paints a similar but even more constructive picture. Even the supposedly impregnable emerging market currency indexes are noticeably sagging.
The euro and yen, both of whose central banks have meetings this week are giving a wonderful presentation of currencies looking to probe their downside. Yet there’s no shortage of wishful thinkers opining on “someday when they get going.”
The S&P 500 future last week tried and failed to surmount resistance marginally above 2700. Don’t dismiss the protective reaction functions but we know now the clearly defined topside challenge. Which as of last week became even more formidable. And watch the ever creeping higher and much ballyhooed 200-day moving average. Eventually the ever- hopeful earnings season will begin to wind down. It’s one thing to challenge support on a headline. Another if it happens just because.
As for bonds, using an investment thesis of, it has to stop somewhere, is a very QE view of the world. Several times over the weekend, I read about bond vigilantes. I reject the characterization. The sellers who have driven yields to multi- year highs aren’t protesting monetary and fiscal policy developments. They are embracing them.
Trading off news is what we do. Trading off the sheer weight of flows, however is the better way to make money.
WikiLeaks has hit back against a multimillion-dollar lawsuit filed by the Democratic National Committee (DNC), announcing over Twitter that they are seeking donations for a counter-suit, noting "We've never lost a publishing case and discovery is going to be amazing fun," along with a link which people can use to donate to the organization.
The Democrats are suing @WikiLeaks and @JulianAssange for revealing how the DNC rigged the Democratic primaries. Help us counter-sue. We've never lost a publishing case and discovery is going to be amazing fun:https://t.co/E1QbYJL4bB— WikiLeaks (@wikileaks) April 20, 2018
More options:https://t.co/MsNZhrTzTL pic.twitter.com/VbPp7FTNq3
Discovery is a pre-trial process by which one party can obtain evidence from the opposing party relevant to the case. The Trump campaign, which is also named in the DNC filing, says the lawsuit will provide an opportunity to "explore the DNC's now-secret records."
Hours after the Washington Post broke the news of the lawsuit, President Trump tweeted "Just heard the Campaign was sued by the Obstructionist Democrats. This can be good news in that we will now counter for the DNC server that they refused to give to the FBI," referring to the DNC email breach. Trump also mentioned "the Debbie Wasserman Schultz Servers and Documents held by the Pakistani mystery man and Clinton Emails."
Just heard the Campaign was sued by the Obstructionist Democrats. This can be good news in that we will now counter for the DNC Server that they refused to give to the FBI, the Debbie Wasserman Schultz Servers and Documents held by the Pakistani mystery man and Clinton Emails.— Donald J. Trump (@realDonaldTrump) April 20, 2018
In a statement which goes into the various items they'll be pursuing in court, the Trump campaign said the following:
While this lawsuit is frivolous and will be dismissed, if the case goes forward, the DNC has created an opportunity for us to take aggressive discovery into their claims of 'damages' and uncover their acts of corruption for the American people,"
If this lawsuit proceeds, the Trump Campaign will be prepared to leverage the discovery process and explore the DNC's now-secret records about the actual corruption they perpetrated to influence the outcome of the 2016 presidential election. Everything will be on the table, including:
• How the DNC contributed to the fake dossier, using Fusion GPS along with the Clinton Campaign as the basis for the launch of a phony investigation.
• Why the FBI was never allowed access to the DNC servers in the course of their investigation into the Clinton e-mail scandal.
• How the DNC conspired to hand Hillary Clinton the nomination over Bernie Sanders.
• How officials at the highest levels of the DNC colluded with the news media to influence the outcome of the DNC nomination.
• Management decisions by Debbie Wasserman Schultz, Donna Brazile, Tom Perez, and John Podesta; their e-mails, personnel decisions, budgets, opposition research, and more.
What's interesting is that of all the sources the DNC cites in their massive lawsuit - the Steele dossier they paid for isn't one of them.
The DNC suit has drawn criticism from prominent Democrats who would like to restore dignity to the party - such as Claire McCaskill (MO), Jackie Speier (CA) and former Obama White House adviser and CNN commentator David Axelrod - who suggested in a Friday tweet that the "ill-timed" combination of "Comey's flamboyant roll out" and the DNC lawsuit are playing into President Trump's strategy of portraying the investigation against him as a "partisan vendetta."
All of these sideshows—Comey’s flamboyant roll out; this @DNC lawsuit—seem spectacularly ill-timed and abet @POTUS strategy of portraying a sober and essential probe as a partisan vendetta.— David Axelrod (@davidaxelrod) April 20, 2018
Everyone should chill out and let Mueller do his job.https://t.co/e1edkIcrmr
DNC Chair Tom Perez defended the lawsuit on Sunday, which alleges a wide-reaching conspiracy between the Trump campaign, WikiLeaks founder Julian Assange, Russia and others to interfere with the 2016 election. Perez said that the DNC filed the suit "in a timely manner under the statue of limitations."
"I don't know when Director Mueller's investigation is going to end, nor would I ever ask him because I want him to do a good, thorough job," Perez continued, adding that he's confident the lawsuit will get a jury trial.
Perez told ABC News's This Week on Sunday that if the defendants think they can "relitigate all their wild theories" - likely in reference to the litany of bombshell revelations contained within the emails published by WikiLeaks, they will be sadly disappointed.
"(T)here's this thing called Rule 11, where you get sanctioned for trying to do things like that," he said. "That's why we have a civil justice system. You can't fire this judge who will preside over the case. You can't pardon defendants in a civil case. I think it's so important for the American people to see the truth here."
When asked on Meet the Press Sunday whether Hillary Clinton was Hillary Clinton's idea, he responded "You'll have to ask Secretary Clinton."
Despite the fact that the DNC's bank account is running on empty, Perez says that the party "can't afford not to" pursue the lawsuit.
"It's hard to put a price tag on preserving democracy," he continued, also acknowledging that he doesn't know how much money the lawsuit will cost the organization.
As a related aside, Julian Assange has been blocked by Ecuadorian authorities from using the internet for nearly a month due to his comments on the Catalonia separatist movement - depriving him of his ability to opine on topics or defend himself. The hashtag #ReconnectJulian has appeared in response, while supporters conducted a 10 hour online vigil in response.
Julian Assange has now been without visitors, phone or internet for nearly a month. Don’t let this become normalized https://t.co/hZuZOaam5F— Cassandra NoWar Fairbanks (@CassandraRules) April 22, 2018
Immigration is an issue that causes tempers to flare. Many Americans want our borders to be firmly closed to outsiders, especially if those outsiders are brown. Having lived in and been welcome in another country, and having brought my children to the United States, obviously, I’m pro-immigration.
But only to a point.
We had to jump through a lot of expensive hoops to legally be in the countries where we moved. I don’t think that the hoops should be as expensive as they are, but I definitely believe that some requirements must exist. We can’t allow an unchecked influx to upturn our culture.
The law prohibits state and local police agencies from notifying federal officials in many cases when immigrants potentially subject to deportation are about to be released from custody.
Administration officials argued that the state measures not only hinder their ability to carry out federal law, but also put immigration agents and communities at risk.
The other laws administration officials seek to challenge make it a crime for business ownersto voluntarily help federal agents find and detain undocumented workers, and create a state inspection program for federal immigration detention centers. (source)
During the election, Democratic candidate Hillary Clinton said it was our humanitarian obligation to take in refugees.
“We cannot allow terrorists to intimidate us into abandoning our values and humanitarian obligations. Turning away orphans, applying a religious test, discriminating against Muslims, slamming the door on every single Syrian refugee—that’s just not who we are. We are better than that.” (source)
Europe has opened their doors generously but now, they are filled with areas of high risk and looming flashpoints. Let’s take a look at what has happened in Sweden, where unchecked immigration has created a public safety crisis.
Sweden’s migrant problem
Sweden is a Scandinavian country of about 10 million people. The Swedes had a reputation of welcoming immigrants and refugees, but the arrival of 165,000 refugees in one year has caused them to take another look at their policies.
Sweden has been famously known for its welcoming attitude toward refugees and its commitment to family reunification. Until recently, it had the most generous immigration laws in Europe.
In 2014, Prime Minister Fredrik Reinfeldt made a famous speech urging Swedes to “open their hearts” to refugees seeking shelter. A year later, the population of just 10 million welcomed 165,000 asylum seekers to Sweden — more per capita than any other European nation.
But a strained welfare system isn’t the only issue with the influx of refugees.
The crime in Malmo and Stockholm has skyrocketed. You can read about it in these articles:
Violence against women has also increased dramatically.
According to the Swedish Crime Survey, compared to 2015, attempted rape against girls 15 – 17 was up 46 percent in 2016.
Rape of teens in that same date and age range is up 19 percent.
Attempted rape of girls under 15 increased 16 percent; rape of young girls in that same age increased by 26 percent.
Rapes against adult women increased by 7 percent.
Around that same time, in 2015, more than 160-thousand people applied for asylum in Sweden from war-torn countries in the Middle East and Africa. (source)
The politically correct laws of Sweden mean that the perpetrators cannot be described to the public, including their ethnicity. The women of Sweden have had to change how they live or risk attack.
In the southern city of Malmö, local media reports there have been four reported gang rapes since November 2017.According to reports, all four happened overnight in the early-morning hours.
As of this posting, there were no arrests, which has left some feeling alarmed.
Here are some women who describe their thoughts on the reports:
“I mean, I don’t walk a lot at night.”
“I wish it wouldn’t be that way, and I’m terrible about the rapes.”
“I know it’s very bad things happening here.”
@PeterSweden71 is a journalist who has been documenting horrific crimes for a few years now. Here are a few of his tweets from JUST ONE DAY, April 19th, 2018.
The fact that much of the crime is committed by migrants in a no-go zone is swept under the rug, which is pointed out in this article in Sputnik News (a Russian government-controlled news agency).
Unsurprisingly, Snopes also rebuts the link between immigrants and increased crime.
Here’s what the police officers have to say about it.
Swedish law enforcement tells a different story.
Peter Springaire, a police officer of 47 years was investigated by prosecutors for “inciting racial hatred” due to his viral post on Facebook.
I’m so fucking tired. What I will write here below is not politically correct. But I don’t give a shit. What I am going to say to you all taxpayers is forbidden to give us state employees…
…Here we go; this i have handled Monday-Friday this week: rape, rape, aggravated rape, överfallsvåldtäkt, extortion, extortion, abuse of justice, illegal threats, violence against police, threats to police, drug law, felony narcotics crime, attempted murder, Rape again, blackmail again and assault.
Suspected perpetrators; Ali Mohamad, mahmod, Mohammed, Mohammed Ali, again, again, again christoffer… what is it true? Yes a Swedish name crept into the outskirts of a drug law, Mohammed, Mahmod Ali, again and again.
Countries representing this week’s all crimes: Iraq, Iraq, Turkey, Syria, Afghanistan, Somalia, Somalia, Syria again, Somalia, unknown country, unknown country, Sweden. Half of the suspects we can’t know for sure because they don’t have any valid papers. Which usually means they lie about nationality and identity.
Now we’re just talking örebro municipality. And these crimes occupy our utredningsförmåga to 100 %. (source)
And Springaire isn’t alone. Watch the clip below. A friend in Sweden has confirmed that the English subtitles are indeed accurate. If a picture is worth a thousand words, then this video is worth a million.
The people in the video have no interest in listening to the police or abiding by the laws. Their goal is to intimidate and do whatever they please.
A cautionary tale
Before the flurry of frenzied accusations begins, I’m not being a racist to point out the fact that some areas of Sweden have been completely taken over by people who have no interest in assimilating into the culture of their host country. The stories above clearly illustrate this is the truth.
While our population is much larger than that of Sweden, we risk similar issues with a flood of immigrants flocking en masse to condensed areas. This isn’t to say that we should never accept any refugees. We’re a country that was built on immigration. But, we can be compassionate without being foolish.
I’m not talking about building walls and slamming the door in the faces of travelers. I’m not talking about mistreating those from different cultures, and I certainly don’t want to see the United States take part in the same kind of insanity that resulted in the internment of Japanese-Americans during World War II.
But we need to ask better questions of those who want to relocate to our country. We must make sure that the people whom we invite in are coming because they’re excited about being Americans. We want to invite people who want to make our country better and stronger.
We don’t want a surge of people who refuse to abide by our laws or who wish to enforce their religious beliefs on others. Our constitution guarantees us not only the freedom OF religion but also the freedom FROM religion.
Sweden is a cautionary tale. Right now Europe is full of these warnings but many still refuse to heed them.
As the old saying goes, those who do not learn from history are doomed to repeat it.
* * *
Note: I was hesitant to write this article because I know that some people will not examine this by the facts presented, but will be outraged that I dared to draw a conclusion that may not be politically correct. I urge you to get past your reflex to accuse me of racism and speak to the facts. Tell me how to avoid a problem like they’re facing in Sweden.
CTAs and quantitative funds are just starting to recover from the historic drubbing they endured during the February "volocaust" when stocks and bonds fell simultaneously in defiance of the funds' carefully calibrated assumptions about asset-price correlations.
And with speculative traders still struggling to fill the void left by the death of XIV (and many desperate to repair the damage done to their bank accounts) one $13.6 billion money manager called Direxion is launching a product that is sure to become the next daytrader darling. It's called the Direxion Daily Robotics, Artificial Intelligence & Automation Index Bull 3X Shares, and as one might deduce from the name, it allows traders to bet on daily fluctuations in a robotics and artificial intelligence index. The company runs other leveraged funds in different sectors.
The fund will compete with the $2.4 billion Robo Global Robotics & Automation Index ETF (ROBO) and the Global X Robotics & Artificial Intelligence ETF (BOTZ).
However, the company offered a disclaimed when approached by Bloomberg: The fund is "not suitable for all investors and should be utilized only by investors who understand the risks associated with seeking daily leveraged and inverse investment results, and intend to actively monitor and manage their investments."
As one might expect, the fund will charge a staggeringly high fee of $12.20 for every $1,000 invested to cover operating costs and "acquired expenses". Its base management fee is 75 basis points.
The only question now is how long it will take to go to zero?
Russia aims to position itself as a leader among energy-producing equals in Eurasia. Since 2015, Russia has sought to play a more active role in the Middle East, setting its sights on the region’s energy resources to achieve this strategic goal...
Having abandoned any attempt to join the Western global political order, Russia seems to have quickly found a new self-image: as the center and core of the Eurasian supercontinent, it can reach in all directions and provide a bridge between Europe and China on both ends. In this context, the Middle East has emerged as a central axis of Russia’s strategic concerns, perhaps for the first time in the country’s history.
In his recent book What Is Russia Up To in the Middle East?, Dmitri Trenin shows how the Middle East was always marginal to Russian geopolitical interests. When progressing south, Russian military expansion had its eyes on the Balkans or Istanbul, in some periods extending to British India, Afghanistan or northern Iran, but a serious push beyond those areas was never considered. Against Ottoman Turkey, Russia waged twelve wars. It took the czarist army half a century to prevail over the mountaineers of the North Caucasus. Russia also conquered Central Asia and invaded Afghanistan, a military adventure that left little appetite for a return to the heart of the Muslim world. But neither the Russian Empire nor the Soviet Union had ever fought directly in Arab lands. In 2015, something genuinely new and unexpected took place. Russia stepped into the Syrian conflict.
Any exercise considering what the Kremlin’s intentions and goals might have been has to start by noting how Syria offered a unique opportunity for promoting Russian strategic interests. By 2015 the United States had exhausted all choices there and showed signs of disinterest and disengagement. A Russian military intervention would constitute something of a revolution in global affairs. For the first time since the end of the Cold War, a country other than the United States would be projecting military force far away from its borders without consulting or involving Washington in the decision.
Syria had never been considered important for Russian national interests, but in the new global landscape that would quickly change. After all, Syria was a critical issue for Turkey and Iran. The refugee crisis was affecting the European Union in powerful ways and China saw the Syrian corridor linking West and Central Asia to the Mediterranean as potentially decisive for the “Belt and Road” initiative, its project of trade and infrastructure development across the Eurasian supercontinent.
With every other major actor reluctant to get involved in the Syrian civil war, Russia had an opening—not to solve the political and humanitarian crisis but to become the most important factor in any future solution.
Once these initial elements were considered, more interesting possibilities started to appear. Between 2013 and 2015, the Russian economy had been under extreme pressure, not so much because of the sanctions imposed after the Ukraine crisis but as a result of the precipitous fall in energy prices. As a major oil and gas producer, Russia had neglected to prioritize energy geopolitics, paying a steep price for that. While China, highly dependent on inward energy flows, had spent decades extending its influence and leverage in Central Asia, Africa, and South America—preparing for all possibilities and diversifying energy supply routes—Russia knew it had more energy resources within its borders than it could ever need and customers were forever assured a more or less mechanical result of a growing and more balanced global economy. But that set of assumptions neglected how other producers can hit your interests by manipulating market prices.
By 2015 the Kremlin was certain that the United States and Saudi Arabia were deliberately lowering oil market prices to squeeze Russia and Iran. With their budgets so highly dependent on oil revenues, Iran and Russia could be effectively pressured into limiting their expansionist agendas. One could even hope that they would become more inclined to abandon their nuclear ambitions, in the case of Iran, and aggressions against Ukraine, in the case of Russia.
At the end of 2015, a 10 percent cut in public spending in Russia was the best evidence of the growing stress from the pincer movement of international sanctions and low energy prices in an economy that depends on crude at $100 a barrel. Faced with a direct challenge, Russia decided that the Middle East was now the arena where its future would be decided.
One Map, Three Regions
In October 2017, Rosneft Chief Executive Officer Igor Sechin took the unusual step of presenting a geopolitical report on the “ideals of Eurasian integration” to an audience in Verona, Italy. One of the maps projected on the screen during the presentation showed the supercontinent—what Russian circles call “Greater Eurasia”—as divided between three main regions. For Sechin, the crucial division is not between Europe and Asia, but between regions of energy consumption and regions of energy production. The former are organized on the western and eastern edges of the supercontinent: Europe, including Turkey, and the Asia Pacific, including India.
Between them we find three regions of energy production: Russia and the Arctic, the Caspian, and the Middle East. Interestingly, the map does not break these three regions apart, preferring to draw a delimitation line around all three. They are contiguous, thus forming a single bloc, at least from a purely geographic perspective.
Sechin’s map has a number of other interesting elements. As noted already, Turkey is left on the European side of the line delimiting the energy production core in the west. The same is true for Ukraine, which although unavoidable in this context is still an unusual inclusion in a map sanctioned by the highest echelons of Russian state power. If one looks at the world through the prism of energy geopolitics, then Ukraine is a European country—a consumer, not a producer.
Some of the most persistent foci of conflict in the contemporary world are located on the delimitation line between regions of energy production and energy consumption: eastern Ukraine, northern Iraq, Syria, Afghanistan, and North Korea. The fact may not be entirely coincidental. Many of these transition zones have become valuable prizes in the global fight for energy resources, with major powers often supporting rival internal factions in their bids for influence and control.
In other cases, the “foci of conflict” are transit hubs for energy flows, determining who has control over them in case of future conflict. More interestingly, transition zones are often fault lines between different political and economic models. It seems to be the case, for example, that the attempt to create a form of personal rule in Syria in the absence of oil wealth created the need for sectarian politics.
Sectarianism—the persistent promotion of mistrust and conflict between different ethnic or religious groups—functions as an alternative to oil, a form of compensation for the lack of oil resources such as those at the disposal of royal families of the Arab Gulf. It provides the ruling elite with a third method of obtaining consent from the governed, distinct from both oil patronage and the social rights of a developed democracy. Lost between two competing models, Syria has been unable to develop a genuinely stable variety of consensual politics.
The map illustrates an important point about Russia’s new self-image. From the point of view of energy geopolitics, Europe and the Asia Pacific are perfectly equivalent, providing alternative sources of demand for energy resources. Russia has been struggling to abandon its traditional orientation toward Europe, hoping to benefit from the flexibility of being able to look both east and west to promote its interests. It seems that Sechin and Rosneft can place themselves in that position much more effortlessly.
Sechin’s map subtly makes one final—and decisive—point. As you consider the three areas it delimits, it becomes apparent that two of them are already led and organized by a leading actor: Germany in the case of Europe and China for the Asia Pacific. Production chains within these highly industrial regions are increasingly managed by German or Chinese companies, which tend to reserve the higher value segments for themselves. Their spheres of influence extend to all important inputs, with one glaring exception: energy. In order to address this vulnerability, the two regions of energy consumption will be attracted to the core region, where they need to ensure ready and secure access to energy resources. And their efforts may well be made easier by the fact that the core region of energy production lacks a hegemon capable of ensuring its survival as an autonomous unit in the Eurasian system.
One further and decisive factor must be mentioned here. As the United States drastically increased its oil and gas production over the last ten years—a result of the shale gas revolution—its role in global energy geopolitics started to shift. Two trends have become dominant.
First, Washington no longer sees the Middle East as critically important for its safety and prosperity. What was a constant of American foreign policy for almost a century now seems open to revision. If domestic supply can now take the place of imports, the United States is less pressured to invest in peace and stability in the Middle East. It is not difficult to speculate that its response to the Syrian civil war would have been different—much more active and resolute—before the shale gas revolution. This fact naturally opened opportunities for Russia, already discussed above.
Second, the new energy abundance in the United States might justify using energy as a geopolitical tool—steering energy flows and influencing market prices so as to reward friendly states and punish others. As we have seen, the Kremlin grew convinced that the United States was doing just that with regards to Russia and Iran. Attempts to use energy markets to drive geopolitical outcomes reinforced Russia’s conviction that it needed to acquire higher levels of dominance in global energy markets, pushing it to intervene more actively in the Middle East.
It is from this perspective that Russia’s renewed interest in the region must be understood. By consolidating all three energy-producing regions under its leadership, Russia can take the decisive step in shaping the new Eurasian system. Its interests lie more decisively in organizing a common political will for the core region than in recovering the old dreams of integration with Europe.
That the Syria military intervention is now regarded as a success—while the intervention in Ukraine led nowhere—may point to the fact that the former, but not the latter, took into account the facts of geopolitics.
On the one hand, Russia feels at home in the Middle East. The pursuit of shifting goals against a background of persistent chaos or state disorder appeals to Russian strategic culture and its early success in Syria was quickly put to use. Suddenly Russia became an important interlocutor for every country in the region. Turkey, Iran, Saudi Arabia, Iraq, and Israel all have significant interests in Syria, so they all need Russia, the new effective overlord above Bashar Al-Assad. On the other hand, Russian leverage in Europe and China depends on the extent to which Moscow is able to increase its control over energy production. Efforts after 2013 to engage China as a growing destination for its energy exports suffered from the obvious difficulty that China had already developed a diversified pool of suppliers and was therefore in a position to dictate purchasing terms that Russia found unattractive.
That a deal was finally reached with Saudi Arabia at the end of 2016 to collectively reduce oil production and give a boost to global oil prices is a direct result of Russia’s ability to influence decisions in the Middle East. Less than a year later, the agreement achieved its objective of raising oil prices to a level of $60 per barrel. King Salman’s visit to Russia in October 2017 was the first ever by a Saudi monarch. With Russia facing a new set of sanctions, Moscow now appears interested in exploring new sources of investment and capital. They may well include Saudi Arabia, following the announcement of more than $3 billion in potential investment deals upon the king’s visit.
In two other maps, Sechin proceeded to show how energy projects offer the best example of Eurasian integration. Major companies from Europe, Russia, China and elsewhere typically pool capital and expertise, investing in exploration and refining projects from Scotland and Egypt to Vietnam and Indonesia. Eurasian integration implies the participation of energy consumers in energy production through investments in the shareholder capital of producers. Rosneft is a good example, with 50 percent of shares owned by the Russian state and stakes from BP, Qatar Investment Authority, Glencore, and CEFC China Energy.
Moscow’s attempts to spread itself across the Middle East can be understood through a series of deals signed in the last two years. The oil and gas giant LUKOIL, the second largest company in Russia after Gazprom, is in negotiations to start production at the newly discovered Eridu field in Iraq. Gazprom Neft, Gazprom’s oil arm, has taken exploration blocks in Iraqi Kurdistan while also operating the Badra field in southern Iraq. Rosneft has signed cooperation agreements in Kurdistan and Libya and has bought a 30 percent stake in Egypt’s giant Zohr offshore gas field.
The very same day he delivered his speech on Eurasian geopolitics, Sechin announced that Rosneft would take control of Iraqi Kurdistan’s main oil pipeline, boosting its investment in the autonomous region to $3.5 billion, despite Baghdad’s military action sparked by a Kurdish vote for independence. The move helped shield Kurdistan from increasing pressure from Baghdad.
Two weeks later, Sechin went on to sign a preliminary pact with the National Iranian Oil Company, the first step before a binding deal to participate in Iran’s oil and gas projects over the next few years, with investments totaling up to $30 billion and a production plateau of 55 million tons of oil per year.
Four Russian oil companies have even begun negotiating for opportunities in Syria, a venture driven as much by politics as by commercial interest. The aim is not to explore and extract Syria’s modest petroleum reserves, of course. By actively participating in rebuilding and operating Syrian oil and gas infrastructure, Russian energy companies will be in control of a critical transit route for Iranian and Qatari oil and gas heading to Europe, bringing two rival producers closer to its orbit and tightening its stranglehold on the European gas supply. In 2009, Qatar proposed to run a natural gas pipeline through Syria and Turkey to Europe. Instead, Al-Assad forged a pact with Iran to build a pipeline from the Persian Gulf and then through Iraq and Syria and under the Mediterranean. This project had to be postponed because of the war. When it is resumed, Russia will be in control.
It is in the very nature of the Eurasian system described by Sechin that the core energy production region—provided it is sufficiently united and organized—will benefit from its central position, being able to pick and choose between east and west in order to obtain the most favorable terms. Russia and the Middle East are now part of the same geopolitical unit. It took the Russian military intervention in Syria for the world to start to come to terms with this reality.
German Green Party member Rebecca Harms has initiated an open letter calling on EU governments to stay away from the FIFA World Cup taking place in Russia in June.
Sixty Members of the European Parliament from 16 member states and 5 different political groups are supporting the call.
The letter (in full below) reads that the poisoning of a former Russian spy in Britain last month “was just the latest chapter in Vladimir Putin’s mockery of our European values.”
Citing “indiscriminate bombings of schools, hospitals, and civilian areas in Syria; the violent military invasion in Ukraine; systematic hacking; disinformation campaigns; election meddling; trying to destabilize our societies and to weaken and divide the EU.”
“All this doesn’t make for a good World Cup host."
Additionally, Harms said on Friday that Putin is responsible for the occupation and war in Ukraine.
Harms letter - and the backing of a growing group of MEPs follows White House representatives warning British and American fans to think twice before going to the World Cup in Russia.
The official said: “We won’t have the same ability to protect our citizens or even just deal with the regular consular affairs.
“If you get into any kind of difficulty there then we just won’t have the wherewithal. People have accidents. They get ill, they need to be medivacked out.”
The official also warned of the threat of Russian hooligans promising to hunt down English fans in the streets and even “kill”.
* * *
To all EU governments,
We, Members of the European Parliament, call on you, as representatives of the people in the European Union, to join the governments of Iceland and the UK in not attending the 2018 FIFA World Cup in Russia.
The Salisbury attack was just the latest chapter in Vladimir Putin’s mockery of our European values: indiscriminate bombings of schools, hospitals and civilian areas in Syria; the violent military invasion in Ukraine; systematic hacking; disinformation campaigns; election meddling; trying to destabilize our societies and to weaken and divide the EU - all this doesn’t make for a good World Cup host.
While we agree that sport can help build metaphorical bridges, as long as Putin is blowing up real ones in Syria, we cannot pretend this World Cup is just like any other major sporting event.
As long as Putin is illegally occupying Crimea, holding Ukrainian political prisoners and supporting the war in Eastern Ukraine we cannot pretend that this tournament’s host is our welcoming neighbour.
And as long as political dissidents and the free press are in constant danger in Russia and beyond, we cannot turn our backs on them to shake Putin’s hand in a football stadium.
Three days after the 2014 Winter Olympics in Sochi, Putin invaded Ukraine, and the world watched in dismay. This time, we can make things right by not cheering at his grave violations of human rights at the 2018 World Cup.
The world is looking at Europe in these difficult times. Our governments should not strengthen the authoritarian and anti-western path of the Russian President, but boycott the 2018 FIFA World Cup in Russia and raise their voices for the protection of human rights, of democratic values and peace.
Adaktusson, Lars (EPP, Sweden)
Andrikiene, Laima (EPP, Lithuania)
Auštrevičius, Petras (ALDE, Lithuania)
Boni, Michal (EPP, Poland)
Bové, José (Greens/EFA, France)
Buzek, Jerzy (EPP, Poland)
Childers, Nessa (S&D, Ireland)
Delli, Karima (Greens/EFA, France)
Durand, Pascal (Greens/EFA, France)
Eickhout, Bas (Greens/EFA, Netherlands)
Fjellner, Christofer (EPP, Sweden)
Fotyga, Anna (ECR, Poland)
Gabelic, Aleksander (S&D, Sweden)
Giegold, Sven (Greens/EFA, Germany)
Griffin, Theresa (S&D, UK)
Guteland, Jytte (S&D, Sweden)
Harms, Rebecca (Initiator of this call, Greens/EFA, Germany)
Hetman, Krzysztof (EPP, Poland)
Heubuch, Maria (Greens/EFA, Germany)
Hökmark, Gunnar (EPP, Sweden)
Jadot, Yannick (Greens/EFA, France)
Jávor, Benedek (Greens/EFA, Hungary)
Jazłowiecka, Danuta (EPP, Poland)
Joly, Eva (Greens/EFA, France)
Kalinowski, Jarosław (EPP, Poland)
Kelam, Tunne (EPP, Estonia)
Kozłowska-Rajewicz, Agnieszka (EPP, Poland)
Kudrycka, Barbara (EPP, Poland)
Lambert, Jean (Greens/EFA, UK)
Lewandowski, Janusz (EPP, Poland)
Łukacijewska, Elżbieta (EPP, Poland)
Macovei, Monica (EPP, Romania)
Moody, Clare (S&D, UK)
Olbrycht, Jan (EPP, Poland)
Pabriks, Artis (EPP, Latvia)
Pietikäinen, Sirpa (EPP, Finnland)
Pitera, Julia (EPP, Poland)
Plura, Marek (EPP, Poland)
Rivasi, Michèle (Greens/EFA, France)
Ropé, Bronis (Greens/EFA, Lithuania)
Rosati, Dariusz (EPP, Poland)
Sargentini, Judith (Greens/EFA, Netherlands)
Siekierski, Czesław (EPP, Poland)
Smith, Alyn (Greens/EFA, UK)
Šojodrová, Michaela (EPP, Czech Republic)
Staes, Bart (Greens/EFA, Belgium)
Štětina, Jaromír (EPP, Czech Republic)
Szejnfeld, Adam (EPP, Poland)
Tarand, Indrek (Greens/EFA, Estonia)
Telička, Pavel (EPP, Czech Republic)
Thun und Hohenstein, Róża Gräfin von (EPP, Poland)
Trüpel, Helga (Greens/EFA, Germany)
Turmes, Claude (Greens/EFA, Luxembourg)
Vaidere, Inese (EPP, Latvia)
Valero, Bodil (Greens/EFA, Sweden)
Wałesa, Jarosław (EPP, Poland)
Ward, Julie (S&D, UK)
Wenta, Bogdan (EPP, Poland)
Zdrojewski, Bogdan (EPP, Poland)
Zwiefka, Tadeusz (EPP, Poland)
Elite Forex Blog - Market Research & Analysis
“This was an operational error in the movement of collateral between Deutsche Bank’s principal accounts and Deutsche Bank’s Eurex account,” Charlie Olivier, a spokesman for Deutsche Bank, wrote in an emailed statement. “The error was identified within a matter of minutes, and then rectified. We have rigorously reviewed the reasons why this error occurred and taken steps to prevent its recurrence.”
The Lusitania set sail for Liverpool on May 1st, 1915 from New York harbor. It was carrying millions of rounds of ammunition and shrapnel. The previous captain Daniel Dow had resigned because of mixing civilian passengers with munitions. The ship was to have a British battleship escort called the Juno but was recalled before the rendezvous in spite of the knowledge that a Uboat was active in the path of the Lusitania.
Speaking with EuroNews, Russia's ambassador to the EU, Vladimir Chizov, said "Russian military specialists have visited this region, walked on those streets, entered those houses, talked to local doctors and visited the only functioning hospital in Douma, including its basement where reportedly the mountains of corpses pile up. There was not a single corpse and even not a single person who came in for treatment after the attack.""But we've seen them on the video!" responds EuroNews correspondent Andrei Beketov."There was no chemical attack in Douma, pure and simple," responds Chizov. "We've seen another staged event. There are personnel, specifically trained - and you can guess by whom - amongst the so-called White Helmets, who were already caught in the act with staged videos." "All these facts show... that no chemical weapons were used in the town of Douma, as it was claimed by the White Helmets." “All the accusations brought by the White Helmets, as well as their photos… allegedly showing the victims of the chemical attack, are nothing more than a yet another piece of fake news and an attempt to disrupt the ceasefire,” said the Russian Reconciliation Center.
“The Chinese have recently issued the gold backed Yuan, which they, and others, have vowed to use to sell/purchase oil (amongst other things). The last two nations that tried to introduce a currency to compete against the petrodollar were Libya and Iraq. The US needs that pipeline through Syria even more than ever now, especially if they are to compete for European gas/oil markets (presently controlled by Russia and their pipeline) and the Chinese Yuan. But i’m sure none of that has anything to do with it…”
“The United States will be a partner and a friend, but the fate of the region lies in the hands of its own people.”“Tonight, I ask all Americans to say a prayer for our noble warriors and our allies as they carry out their missions. We pray that God will bring comfort to those suffering in Syria.”
"Is the approach taken in Washington by the SEC adversely affecting distributed ledger technology in other areas? My quick answer is that my hope is that it's actually helping - because this technology is being used for fraud and to the extent that it's being used for fraud, history shows that government comes down harshly on that technology later."
Utility token debate
The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists.—Ernest Hemingway
By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), and section 301 of title 3, United States Code,I, DONALD J. TRUMP, President of the United States of America, in order to take additional steps with respect to the national emergency declared in Executive Order 13692 of March 8, 2015, and relied upon for additional steps taken in Executive Order 13808 of August 24, 2017, and in light of recent actions taken by the Maduro regime to attempt to circumvent U.S. sanctions by issuing a digital currency in a process that Venezuela’s democratically elected National Assembly has denounced as unlawful, hereby order as follows:Section 1. (a) All transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token, that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018, are prohibited as of the effective date of this order.(b) The prohibitions in subsection (a) of this section apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted before the effective date of this order.Sec. 2. (a) Any transaction that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in this order is prohibited.(b) Any conspiracy formed to violate any of the prohibitions set forth in this order is prohibited.Sec. 3. For the purposes of this order:(a) the term “person” means an individual or entity;(b) the term “entity” means a partnership, association, trust, joint venture, corporation, group, subgroup, or other organization;(c) the term “United States person” means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches of such entities), or any person within the United States; and(d) the term “Government of Venezuela” means the Government of Venezuela, any political subdivision, agency, or instrumentality thereof, including the Central Bank of Venezuela and Petroleos de Venezuela, S.A. (PdVSA), and any person owned or controlled by, or acting for or on behalf of, the Government of Venezuela.Sec. 4. The Secretary of the Treasury, in consultation with the Secretary of State, is hereby authorized to take such actions, including promulgating rules and regulations, and to employ all powers granted to the President by IEEPA as may be necessary to implement this order. The Secretary of the Treasury may, consistent with applicable law, redelegate any of these functions to other officers and executive departments and agencies of the United States Government. All agencies of the United States Government shall take all appropriate measures within their authority to carry out the provisions of this order.Sec. 5. For those persons whose property and interests in property are affected by this order who might have a constitutional presence in the United States, I find that because of the ability to transfer funds or other assets instantaneously, prior notice to such persons of measures taken pursuant to this order would render those measures ineffectual. I therefore determine that for these measures to be effective in addressing the national emergency declared in Executive Order 13692, there need be no prior notice given for implementation of this order.Sec. 6. This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.Sec. 7. This order is effective at 12:15 p.m. eastern daylight time on March 19, 2018.DONALD J. TRUMP
A bizarre political statement by Saddam Hussein has earned Iraq a windfall of hundreds of million of euros. In October 2000 Iraq insisted on dumping the US dollar - 'the currency of the enemy' - for the more multilateral euro.The changeover was announced on almost exactly the same day that the euro reached its lowest ebb, buying just $0.82, and the G7 Finance Ministers were forced to bail out the currency. On Friday the euro had reached $1.08, up 30 per cent from that time.Almost all of Iraq's oil exports under the United Nations oil-for-food programme have been paid in euros since 2001. Around 26 billion euros (£17.4bn) has been paid for 3.3 billion barrels of oil into an escrow account in New York.The Iraqi account, held at BNP Paribas, has also been earning a higher rate of interest in euros than it would have in dollars.At the time of the change the UN issued a report saying that the move could cost Iraq up to £270 million. Independent experts questioned the value of buying into a plummeting currency.'It was seen as economically bad because the entire global oil trade is conducted in dollars,' says Fadhil Chalabi, executive director of the Centre for Global Energy Studies.
There are stories of the government confiscating computers and mining equipment from people. Tell us about this.Yes, sometimes the police squad that visits your place decides to seize your mining equipment, and there is absolutely nothing you can do about it.
What do they do with the equipment?Rumor has it they install them on government facilities.
Operation PBFORTUNE, also known as Operation FORTUNE, was the name of a covert United States operation to overthrow the democratically elected Guatemalan President Jacobo Árbenz in 1952. The operation was authorized by US President Harry Truman and planned by the Central Intelligence Agency. The United Fruit Company had lobbied intensively for the overthrow because landmark land reform enacted by Árbenz threatened its economic interests. The coup attempt was also motivated by US fears that the government of Árbenz was being influenced by communists. It involved providing weapons to the exiled Guatemalan military officer Carlos Castillo Armas, who was to lead an invasion from Nicaragua. The coup was planned with the knowledge and support of Anastasio Somoza García, Rafael Leonidas Trujillo and Marcos Pérez Jiménez, the US-backed right-wing dictators of Nicaragua, Dominican Republic and Venezuela respectively, as well as the United Fruit Company. However, the US State Department discovered that details of the plan had become too widely known. US Secretary of State Dean Acheson was worried that the coup attempt would damage the image of the US, which had committed to a policy of non-intervention, and so terminated the operation. Operation PBFORTUNE was a precursor to Operation PBSUCCESS, the covert operation that toppled Árbenz and ended the Guatemalan Revolution in 1954.
"We have been shamelessly threatened by the most criminal empire that ever existed and we have the obligation to prepare ourselves to guarantee peace," said Maduro, who wore a green uniform and a military hat as he spoke with his army top brass during a military exercise involving tanks and missiles. "We need to have rifles, missiles and well-oiled tanks at the ready....to defend every inch of the territory if needs be," he added.
- First, I’d highlighted all the wrong things.
- Second, I saw instantly how much these men were alike.
Number One: Start Out Clueless
“Q: Did you know anything at all about what you were doing? Had you read anything about commodities or trading?
A: No, nothing.
Q: Did you even know the contract sizes?
A: No, we didn’t.
Q: Did you know how much it was costing you per tick?
Q: Apparently, that was about the only thing you knew.
A: Right. Our next trade, in wheat, didn’t work either. After that, we went back to corn and that trade worked out better; it took us three days to lose our money. We were measuring success by the number of days it took us to lose.”
Number Two: Make the Same Mistakes as Everyone Else
“Soybeans are going to the moon…You are a fool to stay short the November contracts. Let me lift your November shorts for you, and when the market goes limit-up for the next few days, you will make more money.”
“It was a moment of insanity. Fifteen minutes later, my broker calls me back, and he sounds frantic.
‘I don’t know how to tell you this, but the market is limit-down! I don’t know if I can get you out.’ I went into shock. I yelled at him to get me out.”
“I was up about $45,000. By the end of the day, I had $22,000 in my account.”
Number Three: Take a Big Loss
“I went into emotional shock. I could not believe how stupid I had been — how badly I had failed to understand the market, in spite of having studied the markets for years. I was sick to my stomach, and I didn’t eat for days. I thought that I had blown my career as a trader.”
“Q: How much did you lose on the trade by the time you liquidated?
A: I lost my own $30,000, plus $12,000 of the $20,000 my mother had lent me. That was my lesson in betting my whole wad.”
Step Four: Reflect and Come Back Stronger
“It was at that point that I said, ‘Mr. Stupid, why risk everything on one trade? Why not make your life the pursuit of happiness rather than pain?’
That was when I first decided I had to learn discipline and money management. It was a cathartic experience for me, in the sense that I went to the edge, questioned my very ability as a trader, and decided that I was not going to quit. I was determined to come back and fight.”
Step Five: Learn the Age Old Lessons the Hard Way
As Tudor Jones says “losers average losers.”
Step Six: Money Management
Paul Tudor Jones says “I am always thinking about losing money as opposed to making money…I have a mental stop. If it hits that number, I am out no matter what.”
Step Seven: Stop Following Others
“It is a happy circumstance that when nature gives us true burning desires, she also gives us the means to satisfy them.”
Ed Seykota said “eventually I became more confident of trading with the trend and more able to ignore the news. I became more comfortable with the approach.”
Step Eight: Develop Your Own Style
As Ed Seykota says, “Everyone gets what they want out of the markets.”
Ed went further: “I think that if people look deeply enough into their trading patterns, they find that, on balance, including all their goals, they are really getting what they want, even though they may not understand it or want to admit it.”
January 18, 2018
President & CEO
Investment Company Institute
1401 H St., NW, Suite 1200
Washington, DC 20005
Asset Management Group – Head
Securities Industry and Financial Markets Association
1101 New York Avenue, NW, 8th Floor
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Arbitrage (for ETFs)
Potential Manipulation and Other Risks
Division of Investment Management
U.S. Securities and Exchange Commission
- Krishna Mohan
- Jiongsheng Zhao
- James Vorley & Cedric Chanu
- Jitesh Thakkar & Edge Financial Technologies
The CFTC and Department of Justice said in their complaint that those modifications were designed to help him spoof the markets more efficiently.
Read the full story at: https://seekingalpha.com/article/4140678-tzero-ico-make-overstock-wall-street-favorite
Cash has the distinct advantage of being anonymous. You can put cash under your mattress or in a vault, and no one knows about it except you. A national cryptocurrency would make it far more difficult for criminals to hoard money because all transactions would be recorded in the government ledger. If a transaction was deemed illegal, the parties to the transaction could be identified. This is also true with bitcoin, whose ledger is viewable to anyone. Despite the negative press about bitcoin being used for illegal transactions, bitcoin is not anonymous, and criminals who use it often do not understand that their transactions are being recorded.There is another reason for governments to like the idea of a national cryptocurrency: strengthening the power of monetary policy to help manage the economy.
Having taken a gamble on bitcoin futures, which are set to begin trading by the end of the year, the CME is now seeking to avoid the consequences of what has emerged as both the cryptocurrency's best and worst selling point: its unprecedented volatility…While the CME already uses daily vol limits on most other markets, including crude, gold and market futures, to temporarily halt trading when price swings get out of control, the CME has never before dealt with something like bitcoin
The price of Bitcoin (notably, BTC/USD) has been exploding all week basically with the market expecting that with regulated futures contracts, it will bring institutional money into the Crypto market. While that may be true, this futures contract is not exactly a conduit, as it is 'cash settled' which means effectively 'not settled' or 'self-cleared'. CME will match buyers and sellers and not have any connection to any Bitcoin exchange or other clearing facility. At the end of the day, each contract will have a profit or loss, against each other. Crypto Market Makers could at their own risk, provide liquidity on-exchange and lay off risk independently, through the exchanges. But practically, why would they? Just to soak up 'newbie' liquidity from the moms and pops now able to trade the futures contract through their IRA? Something certainly doesn't add up here, and given the chaos and volatility we saw all week, we are expecting at best, a total market meltdown; at worst, they may cease trading the contract. There is certainly a lot of money waiting in the pipeline for the moment the contract goes live. And it's not the only one, CBOE has a contract too, which is the first one which will go live.
Traders wait in anticipation this week to see how the market will react to the first regulated Crypto contracts.
To get in on the action checkout some Bitcoin resources we've added to our website by clicking here. If you want to learn more about Bitcoin from the perspective of digital currency, which we've been doing for 15 years, checkout Splitting Bits - Understanding Bitcoin and the Blockchain.
About 40 percent of bitcoin is held by perhaps 1,000 users; at current prices, each may want to sell about half of his or her holdings, says Aaron Brown, former managing director and head of financial markets research at AQR Capital Management. (Brown is a contributor to the Bloomberg Prophets online column.) What’s more, the whales can coordinate their moves or preview them to a select few. Many of the large owners have known one another for years and stuck by bitcoin through the early days when it was derided, and they can potentially band together to tank or prop up the market.“I think there are a few hundred guys,” says Kyle Samani, managing partner at Multicoin Capital. “They all probably can call each other, and they probably have.” One reason to think so: At least some kinds of information sharing are legal, says Gary Ross, a securities lawyer at Ross & Shulga. Because bitcoin is a digital currency and not a security, he says, there’s no prohibition against a trade in which a group agrees to buy enough to push the price up and then cashes out in minutes.
“As in any asset class, large individual holders and large institutional holders can and do collude to manipulate price,” Ari Paul, co-founder of BlockTower Capital and a former portfolio manager of the University of Chicago endowment, wrote in an electronic message. “In cryptocurrency, such manipulation is extreme because of the youth of these markets and the speculative nature of the assets.”The recent rise in its price is difficult to explain because bitcoin has no intrinsic value. Launched in 2009 with a white paper written under a pseudonym, it’s a form of digital payment maintained by an independent network of computers on the internet‚ using cryptography to verify transactions. Its most fervent believers say it could displace banks and even traditional money, but it’s only worth what someone will trade for it, making it prey to big shifts in sentiment.
Like most hedge fund managers specializing in cryptocurrencies, Samani constantly tracks trading activity of addresses known to belong to the biggest investors in the coins he holds. (Although bitcoin transactions are designed to be anonymous, each one is associated with a coded address that can be seen by anyone.) When he sees activity, Samani immediately calls the likely sellers and can often get information on motivations behind their sales and their trading plans, he says. Some funds end up buying one another’s holdings directly, without going into the open market, to avoid affecting the currency’s price. “Investors are generally more forthcoming with other investors,” Samani says. “We all kind of know who one another are, and we all help each other out and share notes. We all just want to make money.” Ross says gathering intelligence is legal.
Ordinary investors are at an even greater disadvantage in smaller digital currencies and tokens. Among the coins people invest in, bitcoin has the least concentrated ownership, says Spencer Bogart, managing director and head of research at Blockchain Capital. The top 100 bitcoin addresses control 17.3 percent of all the issued currency, according to Alex Sunnarborg, co-founder of crypto hedge fund Tetras Capital. With ether, a rival to bitcoin, the top 100 addresses control 40 percent of the supply, and with coins such as Gnosis, Qtum, and Storj, top holders control more than 90 percent. Many large owners are part of the teams running these projects.
Some argue this is no different than what happens in more established markets. “A good comparison is to early stage equity,” BlockTower’s Paul wrote. “Similar to those equity deals, often the founders and a handful of investors will own the majority of the asset.” Other investors say the whales won’t dump their holdings, because they have faith in the long-term potential of the coins. “I believe that it’s common sense that these whales that own so much bitcoin and bitcoin cash, they don’t want to destroy either one,” says Sebastian Kinsman, who lives in Prague and trades coins. But as prices go through the roof, that calculation might change.
Some current and former Wells Fargo employees say its charges on foreign-exchange trades encouraged employees to cheat customers.
Unusually high fees
“Shinhan is testing a virtual bitcoin vault platform wherein the private keys of bitcoin addresses and wallets are managed and issued by the bank. The bank intends to provide the vault service for free and charge a fee for withdrawals,” the representative said.
“Though we are monitoring the practice of cryptocurrency trading, we don’t have plans right now to directly supervise exchanges. Supervision will come only after the legal recognition of digital tokens as a legitimate currency,” Choe said.
"I can hear the herd coming" Novogratz said.
“Remember, bubbles happen around things that fundamentally change the way we live,” he said. “The railroad bubble. Railroads really fundamentally changed the way we lived. The internet bubble changed the way we live. When I look forward five, 10 years, the possibilities really get your animal spirits going.”
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