Tag: finance

• Ukraine Seeks $35 Billion as Yanukovych Warrant Is Issued (BBG)
• Ukraine’s fugitive president wanted for mass murder (Reuters)
• Polar Vortex to Bring More Snow on Return to U.S. This Week (BBG)
• China property prices continue to rise (FT)
• Microsoft Said to Cut Windows Price 70% to Counter Rivals (BBG)
• Pentagon to propose shrinking Army, scrapping some jets (Reuters)
• Hedge Funds Turn Bearish on S&P 500 as VIX Advances (BBG)
• Draghi’s Data Jigsaw Takes Shape as ECB Readies Showdown (BBG)
• China, eyeing Japan, seeks WW2 focus for Xi during Germany visit (Reuters)
• U.S. now bugging German ministers in place of Merkel (Reuters)
• Emerging Stocks Decline With Copper as Natural Gas Surges (BBG)

 

Overnight Media Digest

WSJ

* Retail health clinics that are popping up in drugstores and other outlets shouldn’t be used for children’s primary-care needs, the American Academy of Pediatrics said, arguing that such facilities don’t provide the continuity of care that pediatricians do.

* With tax season under way, federal authorities are stepping up efforts to stop what they call a growing problem of fraudulent filings seeking tax refunds based on stolen identities.

* Hedge fund Blue Harbor has taken a 2.5 percent stake in Tribune and is discussing with its management moves to boost the media company’s shares.

* CNN says the prime-time talk show “Piers Morgan Live” is coming to an end after just three years in a key primetime slot. The program, hosted by former newspaper editor Piers Morgan, had struggled to gain traction at the 9 p.m. hour, and was routinely beaten in the ratings by cable competitors.

* The activist hedge fund fighting Darden Restaurants Inc over its plan to spin off Red Lobster is trying a new tactic: a shareholder vote that could halt the plan.

* Netflix Inc has agreed to pay Comcast Corp to ensure Netflix movies and TV shows stream smoothly to Comcast customers, a landmark agreement that could set a precedent.

* Boeing Co’s machinists at its St. Louis defense plant agreed Sunday to a seven and a half year contract extension that will further move the company’s unionized employees away from a defined benefit retirement plan.

 

FT

German Chancellor Angela Merkel is likely to urge Britain to stay at the heart of the European Union, dismissing eurosceptics, during her one-day visit to the UK.

European telecoms industry body, Etno, has criticised “over-regulation” of the sector, and blasted proposals for neutrality plans – which would bar them from giving importance to guaranteed internet access services – scheduled to be vetoed in the European Parliament this week.

The European Commission is expected to report a formal complaint against Telefonica’s takeover bid of 8.6 billion euros for KPN’s German mobile division, E-Plus, people familiar with the talks said.

Deutsche Bank has laid out plans to reduce its U.S. balance sheet as the U.S. Federal Reserve adopts new rules to shield the country’s taxpayers from costly bailouts.

British specialist credit advisory firm Venn Partners has bought a 500 million euro portfolio of Dutch residential mortgages, marking its entry into the residential mortgage-backed securities platform since the credit crunch.

 

NYT

The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.

* The Federal Reserve pumped hundreds of billions of dollars to nations to bolster global banks when dollars were scarce, newly released transcripts of 2008 Fed policy committee meetings reveal.

* An actuarial board is recommending a change in the financial information given out by public pension plans, saying more precise, meaningful information about the health of all public pension funds would give citizens the facts they need to make informed decisions.

* Comcast Corp and Netflix Inc announced an agreement Sunday in which Netflix will pay Comcast for faster and more reliable access to Comcast’s subscribers.

* Yahoo Inc is starting to push into two of the hottest areas of Internet advertising: stream ads and so-called native ads, with the aim of making the ads on Yahoo just as compelling and just as integrated with the news and information people seek on the company’s websites and mobile applications.

* Overtaken by new technology and shifting consumer habits, telephone movie listing and ticket service Moviefone will be disconnected.

* News organizations are rushing to form alliances with new companies they hope can give them an edge in finding stories and attracting younger viewers.

* Credit Suisse on Friday became the latest big bank to admit wrongdoing to the Securities and Exchange Commission, striking a deal over its failure to comply with a cardinal rule of the financial industry.

 

Canada

THE GLOBE AND MAIL

* John Tory will end months of speculation on Monday by declaring his candidacy for Toronto mayor, promoting low taxes and a downtown relief subway in a bid to unseat Rob Ford.

* Canada’s middle-class is mortgaging its future to stay afloat, making the Canadian dream “a myth more than a reality.” That is the blunt assessment of an internal Conservative government report, an unvarnished account of the plight of middle-income families that is in contrast to the rosier economic picture in this month’s budget.

Reports in the business section:

* Maple Leaf Foods Inc Chief Executive Michael McCain is asking for patience. Again. The meat company he runs – and owns one-third of – is nearing the end of a multiyear restructuring in which it is replacing production facilities and opening a new distribution system.

* After struggling through a year that Target Corp executives are probably relieved to put behind them, they now face further uncertainties, since the retailer is currently grappling with skittish consumers who are heading to stores less often.

NATIONAL POST

* Federal Liberals passed a controversial resolution calling for the de-criminalization of medically-assisted suicide during their policy convention on Sunday.

* Finance Minister Jim Flaherty said Canada’s economy could post surprising growth this year as optimism remains strong around the U.S. recovery.

FINANCIAL POST

* TekSavvy Solutions Inc must hand over the names of hundreds of its customers accused of illegal file sharing, the Federal Court ruled this week, but internet policy experts say the carefully crafted decision actually lowers the odds of “copyright trolls” setting up shop in Canada.

* With the ups and downs of the Keystone XL pipeline becoming a national obsession, many of those keeping score became more pessimistic this week about the United States approving the project because of a lack of progress at the Three Amigos summit in Mexico, in addition to an unfavourable ruling by a lower court in Nebraska.

 

China

SHANGHAI SECURITIES NEWS

– Widespread talk that some banks have posed curbs on loans to property developers has caused fresh alarm in the sector that has long been criticised for sky-high housing and land prices.

– A sharp fall in China’s short-term money market rates last week, partly propelled by milder-than-expected central bank open market operations, has sparked hopes that the long depressed domestic stock market may continue its recent rebound.

CHINA SECURITIES JOURNAL

– A commentary said unusual high investment in China’s property market over the past decade has caused a saturation in the sector and such investment will for certain cool down along with the slowdown of the country’s economy in recent years.

– The China Banking Regulatory Commission has convened a meeting on rapid expansion of the country’s money market funds, warning that risk is mounting in such products amid an official clampdown on excessive liquidity in the money markets.

CHINA BUSINESS NEWS

– The southern Chinese city of Guangzhou may take the lead to let the public conduct online search on officials’ salaries and other income, a step towards ordering officials to make public their assets, which has been a widespread call from the Chinese public yearning for a clean government.

SECURITIES TIMES

– China may simplify procedures to let brokerages sell assets-backed securities later this year, allowing them to just register with regulators to float such products, instead of applying for approval currently.

CHINA DAILY

– A number of security measures, including a permanent police presence, will be introduced in major hospitals after a rising spate of vicious attacks against medical workers, Sun Haibo, an official at the Ministry of Public Security, said.

SHANGHAI DAILY

– Factories have been closed and vehicles put off the road as China takes a slew of steps to curb persistent air pollution in major cities including its capital of Beijing.

PEOPLE’S DAILY

– China is amending its “Advertisement Law” and may ban any parties to send advertisements to anybody via mobile phone short messengers and emails without the permission of receivers.

 

Britain

The Telegraph

HSBC TO UNVEIL HIGHEST PROFITS SINCE START OF CRISIS

HSBC is expected to unveil its highest profits since the onset of the financial crisis on Monday, fuelled by a surge in mortgage lending as the UK’s economic recovery gathers pace.

GOODBYE NATIONAL INSURANCE. HELLO EARNINGS TAX

National Insurance, a 100-year old charge on employers and employees, will be renamed “earnings tax”, the Chancellor has signalled.

The Guardian

DAVID CAMERON TO PROMISE NORTH SEA OIL REVOLUTION

David Cameron will use his first ever cabinet meeting in Scotland to promise a revolution in North Sea oil and gas extraction worth up to 200 billion pounds over two decades – but that this will only be affordable if the union stays together.

SCANDAL OF EUROPE’S 11 MILLION EMPTY HOMES

More than 11 million homes lie empty across Europe – enough to house all of the continent’s homeless twice over – according to figures collated by the Guardian from across the EU.

The Times

BANKS MUST KEEP TO RULES ON LIQUIDITY, SAYS MARK CARNEY

The Governor of the Bank of England warned last night that banks have to stop refusing to follow new international rules on capital and liquidity.

SECRET PENSION FEES THAT COST BILLIONS ARE EXPOSED

The government is to make fund managers reveal the details of costs and charges for almost all pensions in Britain.

Sky News

HSBC CHIEF EXECUTIVE GULLIVER LANDS 1.8 MLN STG BONUS

HSBC is to hand its chief executive a bonus of 1.8 million pounds as part of a 7 million pound-plus overall pay deal for 2013, Europe’s largest bank will disclose on Monday.

Nokia X Android Smartphone Set For Launch

Nokia’s first Android smartphone is expected to be launched at the Mobile World Congress in Barcelona on Monday.

 

Fly On The Wall 7:00 AM Market Snapshot

ECONOMIC REPORTS
Domestic economic reports scheduled for today include:
Chicago Fed national activity index for January at 8:30 am ET–consensus -0.2
Dallas Fed manufacturing survey for February at 10:00 am ET–consensus 3.0

ANALYST RESEARCH

Upgrades

Artisan Partners (APAM) upgraded to Buy from Neutral at Citigroup
BankUnited (BKU) upgraded to Outperform from Neutral at Credit Suisse
CIBC (CM) upgraded to Buy from Neutral at Citigroup
Canadian Pacific (CP) upgraded to Buy from Hold at BB&T
Comcast (CMCSA) upgraded to Outperform from Sector Perform at Pacific Crest
Consolidated Edison (ED) upgraded to Hold from Underperform at Jefferies
Expeditors (EXPD) upgraded to Outperform from Sector Perform at RBC Capital
Genpact (G) upgraded to Outperform from Market Perform at BMO Capital
Gerdau SA (GGB) upgraded to Buy from Neutral at BofA/Merrill
Invesco Mortgage (IVR) upgraded to Buy from Hold at Wunderlich
Kindred Healthcare (KND) upgraded to Market Perform from Underperform at Wells Fargo
Marriott (MAR) upgraded to Outperform from Market Perform at Raymond James
Molson Coors (TAP) upgraded to Hold from Sell at Societe Generale
Nordstrom (JWN) upgraded to Neutral from Underweight at Atlantic Equities
Pilgrim’s Pride (PPC) upgraded to Buy from Hold at BB&T
Plexus (PLXS) upgraded to Market Perform from Underperform at Raymond James
Select Medical (SEM) upgraded to Market Perform from Underperform at Wells Fargo
Semtech (SMTC) upgraded to Neutral from Sell at B. Riley
Two Harbors (TWO) upgraded to Buy from Hold at Wunderlich
UTi Worldwide (UTIW) upgraded to Outperform from Sector Perform at RBC Capital
Verizon (VZ) upgraded to Buy from Neutral at BofA/Merrill

Downgrades

3D Systems (DDD) downgraded to Underperform from Buy at BofA/Merrill
Builders FirstSource (BLDR) downgraded to In-Line from Outperform at Imperial Capital
Commercial Metals (CMC) downgraded to Hold from Buy at KeyBanc
Container Store (TCS) downgraded to Hold from Buy at Stifel
Container Store (TCS) downgraded to Underperform from Neutral at BofA/Merrill
Extra Space Storage (EXR) downgraded to Neutral from Buy at ISI Group
Forest Labs (FRX) downgraded to Neutral from Outperform at Credit Suisse
Halliburton (HAL) downgraded to Market Perform from Outperform at Wells Fargo
Hibbett Sports (HIBB) downgraded to Sell from Hold at Stifel
Tim Participacoes (TSU) downgraded to Neutral from Buy at Citigroup
Toronto-Dominion (TD) downgraded to Neutral from Buy at Citigroup
U.S. Steel (X) downgraded to Hold from Buy at KeyBanc

Initiations

Canadian Solar (CSIQ) initiated with an Overweight at JPMorgan
Celladon (CLDN) initiated with an Overweight at Barclays
H&R Block (HRB) initiated with an Outperform at Credit Suisse
Lifetime Brands (LCUT) initiated with a Buy at Canaccord
Paragon Shipping (PRGN) initiated with a Buy at Jefferies
Zillow (Z) initiated with an Equal Weight at Morgan Stanley

COMPANY NEWS

Netflix (NFLX), Comcast (CMCSA) announced multi-year interconnection agreement
Chesapeake (CHK) to pursue strategic alternatives for Oilfield Services division
Microsoft (MSFT) added new Windows Phone hardware partners, including Lenovo (LNVGY), Foxconn and LG
Mueller Industries (MLI) hikes dividend 20%, announced 2-for-1 stock split
WellCare (WCG) CFO Tom Tran to step down
MasterCard (MA) to acquire C-SAM, terms not disclosed
Ericsson (ERIC), Facebook (FB) announced joint innovation lab for Internet.org initiative
Ericsson (ERIC), Telefonica (TEF) partner to virtualize networks

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
Autohome (ATHM)

Companies that missed consensus earnings expectations include:
TGC Industries (TGE)

NEWSPAPERS/WEBSITES

Ford (F) to dump Microsoft (MSFT) for BlackBerry (BBRY) in next-generation Sync, Bloomberg reports
HSBC (HBC) not planning to spin off U.K. retail bank, Reuters reports
Pfizer (PFE) to resume shipping thyroid drug Levoxyl, WSJ reports
Deutsche Bank (DB) outlines plans to meet new Fed rules, including reduction in assets held in U.S. unit by up to 25%, FT reports 
Nokia (NOK) looks to expand Juniper (JNPR) sales partnership, smaller deals, Bloomberg reports
Las Vegas Sands (LVS)’ Adelson: ‘I’d spend $10B in Japan,’ WSJ reports
Nokia (NOK) aims for emerging markets with Android smartphones, AP reports
UBS (UBS) wants immunity from U.S., EU in fx investigations, Bloomberg reports
GE (GE) to increase energy research $10B by 2020, Reuters reports
Apple (AAPL), Samsung (SSNLF) fail to reach settlement in patent dispute, WSJ reports
Sina (SINA) preparing to float Weibo in the U.S., FT reports

BARRON’S

Kinder Morgan (KMP, KMR, KMI, EPB) could lose appeal
AIG (AIG), Halliburton  (HAL), Ingersoll-Rand (IR), Discover (DFS) could double dividends
Kaiser Aluminum (KALU) could return about 20% in next 18 months
Ralph Lauren (RL) at good entry point for long-term investors
BHP Billiton (BHP), Rio Tinto (RIO) have room to run higher
Svenska Cellulosa AB (SVCBY) could jump 20% in a year
SanDisk (SNDK) still looks cheap
Compass Minerals (CMP) could reach $100
Facebook’s (FB) acquisition of WhatsApp could be age-driven

SYNDICATE

Atlas Pipeline Partners (APL) files to sell $250M of common units
IMAX (IMAX) files to sell 2.73M shares of common stock for holders
Quintiles (Q) files to sell 15M shares of common stock for holders
Rubicon Minerals (RBY) files to sell 37.15M shares of common stock

via Zero Hedge http://ift.tt/1k3xVkf Tyler Durden

Today’s AM fix was USD 1,333.00, EUR 968.54 and GBP 800.46 per ounce.
Friday’s AM fix was USD 1,320.75, EUR 963.63 and GBP 792.20 per ounce.           

Gold fell $0.20 or 0.02% Friday to $1,323.50/oz. Silver lost $0.02 or 0.09% at $21.81/oz.
Gold and silver were both up for the week at 0.37% and 1.68%.

Gold has risen 0.8% in London and reached $1,334.60/oz, its highest level since October 31. After last years 28% decline, gold is now 11% higher this year.

Gold in U.S. Dollars, 5 Year – (Bloomberg)

Gold may post its fourth week of gains as concern of prolonged political unrest in Ukraine raises fears of a sovereign default and contagion. This is adding to safe haven demand for gold – particularly in Eastern Europe and Russia.

A breakthrough peace deal for Ukraine has halted days of violence and may bring  sweeping political change, meeting many of the demands of the pro-European opposition. However, there are considerable financial and economic challenges facing Ukrainian banks, the Ukrainian pension system and the wider economy. There remains the risk of a default that could lead to contagion.

Bullion for immediate delivery traded at $1,325.10 an ounce at 2:23 p.m. in Singapore from $1,324.28 on February 21, when prices capped a third weekly gain.

The Financial Times reports this morning that global gold prices may have been manipulated on 50% of occasions between January 2010 and December 2013, according to analysis by Fideres, a consultancy.

The findings come amid a probe by German and UK regulators into alleged manipulation of the gold price. Prices are set twice a day by Deutsche Bank, HSBC, Barclays, Bank of Nova Scotia, and Societe Generale in a process known as the London gold fixing.

Fideres’ research found the gold price frequently climbs, or falls, once a twice-daily conference call between the five banks begins, peaks or troughs, almost exactly as the call ends, and then experiences a sharp reversal, a pattern it alleged may be evidence of “collusive behavior.”

Fideres concluded that this “is indicative of panel banks’ pushing the gold price upwards on the basis of a strategy that was likely predetermined before the start of the call in order to benefit their existing positions or pending orders.”

“The behavior of the gold price is very suspicious in 50% of cases. This is not something you would expect to see if you take into account normal market factors,” said Alberto Thomas, a partner at Fideres.

Pension funds, hedge funds, commodity trading advisers and futures traders are most likely to have suffered losses as a result, according to Mr Thomas. He said that many of these groups were “definitely ready” to file lawsuits.

Daniel Brockett, a partner at law firm Quinn Emanuel, also said he had spoken to several investors concerned about potential losses.

Matt Johnson, head of distribution at ETF Securities, one of the largest providers of exchange-traded products, said that if gold price collusion is proven, “investors in products with an expiry price based around the fixing could have been badly impacted.”

Gregory Asciolla, a partner at Labaton Sucharow, a U.S. law firm, added: “There are certainly good reasons for investors to be concerned. They are paying close attention to this and if the investigations go somewhere, it would not surprise me if there were lawsuits filed around the world.”

All five banks declined to comment on the findings, which come amid growing regulatory scrutiny of gold and precious metal benchmarks.

BaFin, the German regulator, has launched an investigation into gold-price manipulation and demanded documents from Deutsche Bank. The bank last month decided to end its role in gold and silver pricing. The U.K.’s Financial Conduct Authority is also examining how the price of gold and other precious metals is set as part of a wider probe into benchmark manipulation following finding of wrongdoing with respect to LIBOR and similar allegations with respect the foreign exchange market.

The Financial Times article, ‘Gold price rigging fears put investors on alert’,can not be accessed this morning, but the Gold Anti Trust Action Committee (GATA) covered the Financial Times story in their dispatches and it can be read here. 

Webinar: Gerald Celente On Strategies For Protecting Your Wealth In 2014 And Beyond
Join Gerald Celente on this broadcast as he examines the opportunities in 2014 and in the coming uncertain years.

Gerald Celente needs little introduction: Founder of The Trends Research Institute in 1980, Gerald Celente is a pioneer trend strategist. He is author of the national bestseller Trends 2000 and Trend Tracking (Warner Books) and publisher of the internationally circulated Trends Journal newsletter.

Celente’s Trends Research Institute has been featured on Oprah Winfrey amongst hundreds of media interviews and credited with forecasting many major geopolitical and economic trends.

These include the “Panic of ’08,” the collapse of the Soviet Union, the dot-com bust, the 1997 Asian currency crisis, the 1987 world stock market crash, increased terrorism against America, “Crusades 2000,” and the quagmire in Iraq … before war began and the last two recessions.

This webinar is scheduled for Wednesday, February 26, 2014 2000 GMT / 1200 PST / 1500 EST and will be moderated by Mark O’Byrne, Head of Research at GoldCore.

via Zero Hedge http://ift.tt/1c0Ztr1 GoldCore

Once again it was all about the China and the carry trade. First it was Chinese stocks that tumbled overnight, closing down 1.75% driven by real-estate stocks. The catalyst was new-home-price data released at the market open which showed average prices up 0.4% in January for a 9% gain from the year-earlier period. The housing bubble in the top-tier cities continued, if at a slightly slower pace.

So what drove China stocks lower? Shanghai Securities News noted that ICBC and some other banks have curbed loans to developers in sectors such as steel and cement. Slower gains in home property prices in China’s tier 1 cities are also not helping sentiment. Beijing and Shenzhen prices rose 0.4% in January, which looks to be the slowest monthly gain since October 2012 according to Bloomberg. Elsewhere there are reports that a property developer in Hangzhou (Tier 2 city in China) is reducing its unit prices by 19%. Our property analysts noted that given the strong gains seen in Tier-1 and some bigger Tier-2 cities in 2013, a slowdown or negative trends in price growth should not be a surprise. Nevertheless, it has been a very weak day for Chinese and HK markets with the Shanghai Composite and the Hang Seng indices down -2.0% and -1.2% lower as we type. Across the region, bourses in Japan and Korea are down -1.0% and -0.6%, respectively.

Among the losers, China Overseas Land is down 3.8%, China Resources Land is off 5.5%, and Agile Property is taking a punishing 8.3% sell-down.

The Chinese weakness in turn pushed the all important USDJPY pair lower, dropping as low as 102.20, which adversely impacted US futures and European stocks in early trade. In Europe we got confirmation once again that deflation rules, after the Eurozone CPI printed -1.1% in January, in line with expectations, and down from 0.3% previously, confirming the ECB’s strategy of hoping something changes on its own, will simply not work. Subsequently, the USDJPY perfectly expeted ramp since then to 102.50 in the now widely anticipated pattern where the USDJPY is sold off during overnight trading and bought – and aggressively ramped – during US hours, means that futures are currently modestly green and will likely go for another try at an all time high later today.

The release of better than expected German IfO survey failed to reverse the cautious sentiment which saw stocks open lower in Europe amid renewed fears over potential credit freeze in China. In terms of the price action overnight in Asia, JGBs were supported by reports that some commercial banks in China tightened lending for property, which in turn translated into softer stocks and triggered squaring of long USD/JPY positions. As a result, heading into the North American open, equities in Europe are seen mixed with the FTSE-100 index underperforming, with Vodafone trading ex-div and at a new adjusted weighting in the benchmark index.

Despite the lacklustre price action by EU stocks, the headline IfO reading, which climbed to its highest level since July 2011, resulted in an immediate selling pressure on Bunds, which were also weighed on by positive sentiment stemming from an upgrade of Spain’s sovereign credit rating prompting tightening of the SP/GE 10y spread since the get-go. Going forward, market participants will get to digest the release of the latest Chicago Fed and Dallas Fed Activity Index reports, as well as earnings by EOG Resources.

US event calendar

• Chicago Fed national activity index, cons n/a (8:30)
• Former Fed Chair Greenspan (8:45)
• US sells $50bn 3m and 6m bills (11:30)
• POMO: $2.50 – $3.00 billion in the 11/30/2019 – 02/15/2021 range

Asian Headlines

Japanese PM adviser Hamada says BoJ can wait for summer data releases, reflecting the tax hike effect to decide whether to ease further and PM Abe should put off the decision until H2 on a second sales tax hike if the Japanese job recovery stalls and deflationary gap persists. (RTRS)

EU & UK Headlines

German IFO Business Climate (Feb) M/M 111.3 vs. Exp. 110.5 (Prev. 110.6) – highest level since July 2011.
– Current Assessment (Feb) M/M 114.4 vs. Exp. 112.8 (Prev. 112.4)
– Expectations (Feb) M/M 108.3 vs. Exp. 108.1 (Prev. 108.9)

Eurozone CPI (Jan F) Y/Y 0.8% vs. Exp. 0.7% (Prev. 0.7%)
– Eurozone CPI (Jan) M/M -1.1% vs. Exp. -1.1% (Prev. 0.3%)
– Eurozone CPI Core (Jan F) Y/Y 0.8% vs. Exp. 0.8% (Prev. 0.8%)

The SP/GE 10y spread trades at the tightest level since early 2011 following Moody’s upgrading Spain’s sovereign rating to Baa2 from Baa3; outlook positive late on Friday.

ECB’s Draghi (Dove) signalled the central bank’s March policy meeting could be critical in determining whether the ECB will provide more stimulus to the Eurozone economy. Draghi said “by then we’ll have the full set of information needed for us to decide whether to act or not”. (DJN) Draghi added “I wouldn’t say I am comfortable with the inflation rate”. March’s ECB meeting will be the first with 2016 inflation forecasts for the policy-setting board. BoE’s Carney said the MPC will not take risks with the UK recovery, and guidance now requires more complex judgement. (BBG)

Meanwhile, Broadbent reiterated the recent cautious theme from the BoE, stating he expects interest rate hikes to be “gradual and limited” when the BoE decides to tighten policy. (Sunday Times)

Barclays preliminary pan-Euro agg month-end extensions: (+0.07y) (12m avg. +0.07y)
Barclays preliminary Sterling month-end extensions:(+0.05y) (12m avg. +0.06y)

Global

The G20 have agreed to target reforms aimed at adding more than USD 2trl to the global economy over five years, marking a shift in emphasis at G20 level from championing austerity to promoting growth as the financial crisis recedes. Ministers also reiterated their commitment for monetary policy among G20 members to be “carefully calibrated and clearly communicated”. (FT)

US Headlines

Barclays preliminary US Tsys month-end extensions:(+0.12y) (12m avg. +0.07y)

Equities

In terms of notable equity movers, London listed HSBC shares came under selling pressure in early trade after the bank reported lower than expected FY pretax, adding that it anticipates greater volatility in 2014 choppy markets. Elsewhere, Scania shares surged at the open (+35%) after Volkswagen offered to buy the rest of Scania for EUR 6.7bln to intensify cooperation with its other commercial-vehicles units.

US investor George Soros said he believes in the EUR adding that he is looking into investments in Greece as its economy improves. He added at Euro-area is at risk of Japan-style economic stagnation. (Spiegel)

FX

Despite the risk averse sentiment as evidenced in lower stocks, USD/JPY managed to recover off lowest levels, while EUR/CHF also traded higher. At the same time, concerns over credit markets in China failed to weigh on AUD, which traded higher, benefiting from a weaker USD and higher precious metal prices. Looking elsewhere, comments by  Carney and Broadbent had little impact on the price action of GBP/USD, which heading into the North American cross over is seen higher and remained a by-product of option related flow, with a number of large strikes expiring on Tuesday at 1.6650 level.

Commodities

Libyan oil production has fallen to 230,000bpd after the closure of the El Sharara oilfield due to industrial action and strikes in the area, according to the NOC. (RTRS)

China has issued new rules for the opening of oil and gas pipe network markets, saying operators should open pipelines to third-party companies if there’s surplus capacity. (BBG)

A 65-mile stretch of the lower Mississippi, including the Port of New Orleans, has been closed following a oil spill due to a barge being hit by another vessel, with no information as to when the river will be re-opened. (RTRS)

Gold speculators, managed money, have increased their net long positions in gold by 21,652 contracts to a net long position of 90,942 contracts, the most bullish since the beginning of November, with the group adding 10,830 bullish bets in sliver to a net long of 18,504 lots. (CFTC)

***

We conclude with the traditional overnight recap by DB’s Jim Reid:

With a US holiday last Monday and half-term for many, last week struggled for momentum. This wasn’t helped by US data still being in limbo due to the cold weather. We should get more trading activity this week but the data is unlikely to be clean enough yet for investors to make firm conclusions on the current economic run-rate. It seems ridiculous to say this given the weather on both sides of the Atlantic but my chronic early year hay fever struck yet again this past weekend after a week of bubbling under the surface. I was debilitated yesterday evening by a non-stop sneezing fit and itchy eyes. When I mentioned this last year I was stunned by how many readers also suffer early season. Any cures/remedies gratefully received as long as it doesn’t include giving up golf.

Over the weekend the dramatic turn of events in Ukraine was clearly the main story. The uprising in country saw toppled President Viktor Yanukovich flee the capital on Saturday and also the release of former Ukrainian PM Yulia Tymoshenko from prison hospital. Former speaker of the parliament, Oleksandr Turchynov, has been elected as the acting head of state until a new presidential election on the 25th May. Mrs Tymoshenko has ruled herself out of contention to be Ukraine’s new prime minister though. She is expected to run for president in the election in May. Mr. Turchynov has also urged parties to agree on a new coalition cabinet by tomorrow. Indeed there is little time to waste given the rising risk of a debt default. S&P last Friday downgraded its rating on Ukraine to CCC from CCC+ as the substantial deterioration in the political situation raises  question marks around the financial support from Russia, which Ukraine is dependent on – in particular a US$15bn tranche which was scheduled to be fully disbursed before 2H 2014. S&P estimates that the government and related state-owned entities have about US$13bn in foreign currency debt service to make in 2014. Speaking at the G20 finance ministers summit in Sydney, leaders from the western world have agreed to offer financial support when a new cabinet is formed. IMF’s Largarde echoed this and said the fund will be ready to engage which will probably be accompanied by some form of debt restructuring. Ukraine’s benchmark 7.5% 2023 dollar bonds rallied 4 points on Friday to around $85 after having traded as low as $78.8 the day prior. Likewise Ukraine’s 5yr CDS also snapped 150bps tighter on Friday. In equities, the country’s market benchmark rebounded by a sharp 5.6% on Friday so today’s price action will certainly be interesting to watch.

Indeed outside of news from Ukraine, the G20 finance ministers and central bank meeting in Sydney was the other main weekend event. The final communiqué set a target to develop ‘ambitious but realistic’ policies with the aim of lifting the G20 collective GDP by more than 2% above the trajectory implied by current policies over the next 5 years although it was light on concrete details on how exactly this can be achieved.

Turning to markets, Asian equities are trading lower across the board on the back of some negative credit stories from China. Shanghai Securities News noted that ICBC and some other banks have curbed loans to developers in sectors such as steel and cement. Slower gains in home property prices in China’s tier 1 cities are also not helping sentiment. Beijing and Shenzhen prices rose 0.4% in January, which looks to be the slowest monthly gain since October 2012 according to Bloomberg. Elsewhere there are reports that a property developer in Hangzhou (Tier 2 city in China) is reducing its unit prices by 19%. Our property analysts noted that given the strong gains seen in Tier-1 and some bigger Tier-2 cities in 2013, a slowdown or negative trends in price growth should not be a surprise. Nevertheless, it has been a very weak day for Chinese and HK markets with the Shanghai Composite and the Hang Seng indices down -2.0% and -1.2% lower as we type. Across the region, bourses in Japan and Korea are down -1.0% and -0.6%, respectively.

Previewing the week ahead we do have a fairly eventful data calendar although the second half of Yellen’s semi-annual monetary policy testimony before the Senate Banking Committee is probably the highlight in the US. Recall that her testimony was previously delayed by winter storm Pax but our house view is that it is unlikely that her prepared remarks will differ significantly from her statement before the House Financial Services Committee. Data has largely disappointed since her ‘first half’ appearance before the House so the Q&A session will be important as ever to watch for any changes in her tone/outlook regarding the economy. For the record Joe LaVorgna expects little change in her tone on that front. On that, while the market has been lowering their GDP outlook for Q1 Joe’s view of 3.1% remains unchanged. He believes money will just be spent on different things (eg utility bills and clean up works) rather than not spent at all. On the data front, notable US releases this week include the Conference Board Consumer Index (Tues), New Home Sales (Wed), Durable Goods Orders (Thurs), and the second reading of Q4 GDP, Pending Home Sales and the Chicago PMI (all on Friday). It is likely that we will see more weather-related distortions on the data flow this week though. On the other side of the pond, we have inflation readings across Eurozone (today), Germany (Thurs), and Spain (Fri).

We’ll also have the latest German IFO business confidence (today) and the final Q4 GDP print from Germany (Tue). It will be another busy week for earnings with 45 and 121 S&P 500 and Stoxx600 companies due to report. As US earnings season draws to a close, the focus will mostly be on Europe. HSBC, BASF, RBS and Telefonica are some of the major names scheduled to announce this week.

On the EM front, monetary policy meetings in Brazil (Wed) and Colombia (Fri) are the key events in Latam. A rate hike is likely in Brazil although market forecasters polled are rather divided between a 25bps and a 50bps increase. Data-wise we have GDP data in India, South Africa and Brazil throughout the week.

via Zero Hedge http://ift.tt/Ot9imW Tyler Durden

In what appears yet another straw on the camel’s back of Mt.Gox (following the re-freeze of account withdrawals), the Bitcoin Foundation this evening reported that:

“effective immediately, Mt. Gox has submitted their resignation from the board of directors.”

Bitcoin prices on the dying exchange tumbled on the announcement after quite an extreme volatility day – which saw prices swing from $151 to $239 and then down to $190 on the news.

 

 

Via The Bitcoin Foundation,

Mt. Gox Resigns Bitcoin Foundation Board Seat

 

Jon Matonis Feb 23 2014

 

Effective immediately, Mt. Gox has submitted their resignation from the board of directors. We are grateful for their early and valuable contributions as a founding member in launching the Bitcoin Foundation. MtGox Co. Ltd. (Japan) held one of the three elected industry member seats.

 

Further details, including election procedures, will be forthcoming.

There is still no further updates on when Mt.Gox will resume withdrawals.

As CoinDesk notes,

This is the second time in recent months that a senior Bitcoin Foundation member and Board Member has resigned from the position under a cloud. BitInstant CEO Charlie Shrem, who was the Board’s vice chairman, also resigned in late January after his arrest over allegations of money laundering.

via Zero Hedge http://ift.tt/1ffPY1u Tyler Durden

Submitted by Zachary Zeck via The Diplomat,

A senior researcher and officer in China’s People’s Liberation Army said that establishing an Air Defense Identification Zone (ADIZ) is essential to China’s national interest.

“The establishment of another ADIZ over the South China Sea is necessary for China’s long-term national interest,” Senior Colonel Li Jie, a researcher at the PLA Navy’s Military Academy and frequent media commentator, said on Friday, according to a report in Reuters.

Li’s comment seemed to be slightly inconsistent with a statement from China’s Foreign Ministry back in February, which dismissed Japanese media reports that said China was preparing to establish a South China Sea ADIZ. That statement, however, seemed to leave open the possibility that China might do so in the future.

When initially announcing its East China Sea ADIZ, Chinese officials readily admitted that they intended to establish other ADIZ over other areas in the future.

Li’s remark came in the context of a discussion about remarks made by U.S. Captain James Fanell, director of intelligence and information operations at the US Pacific Fleet. As The Diplomat previously reported, at a recent U.S. Naval Institute conference Capt. Fanell said that the PLA had held a drill to practice defeating Japan’s Maritime Self Defense Forces in the East China Sea as a prelude to seizing the disputed Diaoyu/Senkaku Islands.

In that same speech (see video below) Fanell also predicted that China would establish an ADIZ in the South China Sea by 2015 at the latest. Li characterized this remark as America’s attempt to deter China from establishing a South China Sea ADIZ.

On Thursday, however, the Pentagon distanced itself from Fanell’s remarks, with Pentagon spokesperson Rear Admiral John Kirby saying that “those were his views to express.” Kirby continued: “What I can tell you about what Secretary Hagel believes is that we all continue to believe that the peaceful prosperous rise of China is a good thing for the region, for the world.  We continue to want to improve our bilateral military relations with China.” Indeed, Army Chief of Staff Ray Odierno is currently in China meeting his PLA counterpart.

Li said that the Pentagon’s decision to distance itself from Fanell’s comments was a tactical move on the part of the U.S. “It’s a typical U.S. diplomatic strategy,” Li said, according to Reuters. “Washington is very concerned about the tension developing in the South China Sea, which will relate to its strategic interests.”

It’s worth noting that Rear Admiral Kirby distancing the Pentagon from Fanell’s remarks was likely referring in particular to the latter’s comments about China’s military forces training to defeat Japan’s MSDF in the East China Sea.

Fanell’s remark about China’s interest in establishing a South China Sea ADIZ was much less controversial and in fact broadly consistent with the comments made by numerous senior officials in recent months. As far back as last December, Secretary of State John Kerry stated: “Today, I raised our deep concerns about China’s announcement of an East China Sea Air Defense Identification Zone…. The zone should not be implemented, and China should refrain from taking similar unilateral actions elsewhere in the region, and particularly over the South China Sea.”

Here’s a video of the panel in which Capt. Fanell made his blunt assessment. Fanell begins speaking around the 19:00 minute mark, right after The Diplomat’s own Naval Diplomat gives his remarks, which we republished here.

 

and then this most recent note from sources…

Chan Kai Yee of China Daily Mail, a blog with no connection to Beijing, Feb. 22, 2014, provides the following summary translation of an article in Qianzhan.com, a Chinese-language news site headquartered in the city of Shenzhen in China’s southeastern Guangdong province, with offices in Beijing and Hong Kong:

Quite a few people have said that the conflict over the Diaoyus (known as Senkakus in Japan) has passed the stage of oral confrontation and what follows may very probably be direct military conflict.

 

It is especially so as, relying on US support, Japan is obviously declaring war against China already.

 

Sources say that China’s Central Military Commission has directly given Chinese military the instruction: “Fight if it is appropriate to fight.”

 

Sources pointed out that they had received information that Xi Jinping, Chairman of the Central Military Commission, gave a relevant warning to a Japanese economic and trade delegation that recently visited China.

 

Xi specially pointed out to the delegation when he met them, if Japan kept provoking China and thus gave rise to an unstable situation, it alone has to be responsible for all the consequences.

via Zero Hedge http://ift.tt/1hfUiCt Tyler Durden

Submitted by Zachary Zeck via The Diplomat,

A senior researcher and officer in China’s People’s Liberation Army said that establishing an Air Defense Identification Zone (ADIZ) is essential to China’s national interest.

“The establishment of another ADIZ over the South China Sea is necessary for China’s long-term national interest,” Senior Colonel Li Jie, a researcher at the PLA Navy’s Military Academy and frequent media commentator, said on Friday, according to a report in Reuters.

Li’s comment seemed to be slightly inconsistent with a statement from China’s Foreign Ministry back in February, which dismissed Japanese media reports that said China was preparing to establish a South China Sea ADIZ. That statement, however, seemed to leave open the possibility that China might do so in the future.

When initially announcing its East China Sea ADIZ, Chinese officials readily admitted that they intended to establish other ADIZ over other areas in the future.

Li’s remark came in the context of a discussion about remarks made by U.S. Captain James Fanell, director of intelligence and information operations at the US Pacific Fleet. As The Diplomat previously reported, at a recent U.S. Naval Institute conference Capt. Fanell said that the PLA had held a drill to practice defeating Japan’s Maritime Self Defense Forces in the East China Sea as a prelude to seizing the disputed Diaoyu/Senkaku Islands.

In that same speech (see video below) Fanell also predicted that China would establish an ADIZ in the South China Sea by 2015 at the latest. Li characterized this remark as America’s attempt to deter China from establishing a South China Sea ADIZ.

On Thursday, however, the Pentagon distanced itself from Fanell’s remarks, with Pentagon spokesperson Rear Admiral John Kirby saying that “those were his views to express.” Kirby continued: “What I can tell you about what Secretary Hagel believes is that we all continue to believe that the peaceful prosperous rise of China is a good thing for the region, for the world.  We continue to want to improve our bilateral military relations with China.” Indeed, Army Chief of Staff Ray Odierno is currently in China meeting his PLA counterpart.

Li said that the Pentagon’s decision to distance itself from Fanell’s comments was a tactical move on the part of the U.S. “It’s a typical U.S. diplomatic strategy,” Li said, according to Reuters. “Washington is very concerned about the tension developing in the South China Sea, which will relate to its strategic interests.”

It’s worth noting that Rear Admiral Kirby distancing the Pentagon from Fanell’s remarks was likely referring in particular to the latter’s comments about China’s military forces training to defeat Japan’s MSDF in the East China Sea.

Fanell’s remark about China’s interest in establishing a South China Sea ADIZ was much less controversial and in fact broadly consistent with the comments made by numerous senior officials in recent months. As far back as last December, Secretary of State John Kerry stated: “Today, I raised our deep concerns about China’s announcement of an East China Sea Air Defense Identification Zone…. The zone should not be implemented, and China should refrain from taking similar unilateral actions elsewhere in the region, and particularly over the South China Sea.”

Here’s a video of the panel in which Capt. Fanell made his blunt assessment. Fanell begins speaking around the 19:00 minute mark, right after The Diplomat’s own Naval Diplomat gives his remarks, which we republished here.

 

and then this most recent note from sources…

Chan Kai Yee of China Daily Mail, a blog with no connection to Beijing, Feb. 22, 2014, provides the following summary translation of an article in Qianzhan.com, a Chinese-language news site headquartered in the city of Shenzhen in China’s southeastern Guangdong province, with offices in Beijing and Hong Kong:

Quite a few people have said that the conflict over the Diaoyus (known as Senkakus in Japan) has passed the stage of oral confrontation and what follows may very probably be direct military conflict.

 

It is especially so as, relying on US support, Japan is obviously declaring war against China already.

 

Sources say that China’s Central Military Commission has directly given Chinese military the instruction: “Fight if it is appropriate to fight.”

 

Sources pointed out that they had received information that Xi Jinping, Chairman of the Central Military Commission, gave a relevant warning to a Japanese economic and trade delegation that recently visited China.

 

Xi specially pointed out to the delegation when he met them, if Japan kept provoking China and thus gave rise to an unstable situation, it alone has to be responsible for all the consequences.

via Zero Hedge http://ift.tt/1hfUiCt Tyler Durden

Before the Ukraine, there was Syria. Before Syria, there was Iran. For over 30 years, Iran was the perpetual strawman of every attempt to escalate hostilities in the middle east. One only needs to recall that the original “red line” was not Obama’s but that of Israel’s PM Netanyahu referring to Iran’s nuclear program (which most likely was under the control of Stuxnet, and thus the NSA, more than it was Iran’s to begin with).

What is surprising in recent months, is how quickly in the aftermath of the Syrian failed escalation script from last summer, Iran quickly dropped off the axis of America’s worst enemies, and from the biggest bogeyman, has rapidly become a nation with which the US is eager to resume diplomatic and trade relations. Sure, Israel pretended to be angry about Iran’s ascent in the ranks of US foreign allies-to-be, and issued a few angry press releases, but that’s all it was – posturing, fit only for the front page of tabloids. It is what was happening behind the scenes that is noteworthy.

And what is happening behind the scenes is the same thing that happens every time the US (or Israel, or any other western nations) finds a surprising new ally: said ally proceeds to purchase military equipment from the US (or other western nations), using loans from the US (or other western nation banks).

Enter bizarre twist #1 – US companies selling military parts to none other than the formerly country non grata (at least until mid-2013): Iran. Reuters reports:

U.S. aerospace companies are seeking permission to sell airliner parts to Iran for the first time in three decades, in a key test of the temporary relief on sanctions given under talks to curtail Iran’s nuclear activities.

 

At least two leading manufacturers, Boeing and engine maker General Electric, have applied for export licenses in a six-month window agreed by Iran and six world powers in November, industry officials and other sources familiar with the matter said.

 

If approved, the sales would be the first acknowledged dealings between U.S. aerospace companies and Iran since the 1979 U.S. hostage crisis led to sanctions that were later broadened during the dispute over Iran’s nuclear activities.

 

A source familiar with the matter said that Boeing, the world’s biggest manufacturer of passenger jets, had also filed a request for permission to export parts to Iran.

 

Boeing declined to comment, referring questions to the U.S. State Department, which in turn referred queries to the U.S. Treasury. A spokeswoman for the Treasury Department, which enforces international sanctions, declined to comment on specific license requests or applications.

Enter bizarre twist # 2 – “GE is doing it for the kids.”

A GE spokesman said his company had been asking since 2004 for permission to provide parts and maintenance for engines for safety reasons, without profiting from the scheme. GE, the world’s largest maker of jet engines by sales, refiled its request after the sanctions relief came into force, he added.

 

“We don’t want to make a penny on it. It’s entirely for flight safety,” Rick Kennedy said, adding that GE would donate any proceeds to charity.

But of course, because when one thinks suing the US to get tax refunds corporate generosity (if not bailouts), one thinks GE.

Enter bizarre twist # 3 – it is not only the US that is seeking to promptly capitalize on this “temporary” elimination of Iran sanctions. It is Iran’s perpetual nemesis, Israel, that is not only planning to supply weapons to Iran, but is already doing so. However, unlike the US which at least has clumsily stumbled upon a detente whose only purpose is logically to get Iran to buy Made in America weapons, with Israel the hypocrisy takes on a whole new meaning. Quote the Telegraph:

Benjamin Netanyahu, the Israeli prime minister, called for increased pressure on Iran to force it to abandon a programme that Israel regards as a front for building an atomic bomb and a threat to its existence.

 

Visiting the Golan Heights on Tuesday, he accused Iran of “arming those who are carrying out the slaughter” in neighbouring Syria.  “I would like to tell the world, today, as the talks between the major powers and Iran are being resumed, that Iran has changed neither its aggressive policy nor its brutal character. Iran is continuing to support the Assad regime, which is slaughtering its own people,” Mr Netanyahu said.

And this is where it gets embarrassing for Bibi: it was Israel that was arming Iran.

[A] court in Athens has told The Telegraph that parts appearing on an American list of forbidden military-grade materials had been shipped from Israel on two occasions, apparently destined for Iran.

 

The seized items comprised spare parts for military aircraft: a constant speed drive designed for the F-4 Phantom jet, and a voltage output sensor used in the F-14 Tomcat. The parts were confiscated by Greece’s financial crimes squad and were being sent to the US for investigation, court officials said.

 

…

 

Israeli arms dealers twice tried to send spare parts for fighter planes to Iran, The Telegraph has established, flouting an international arms embargo and openly contradicting the bitter enmity between the Jewish state and the Islamic regime.

 

The illegal shipments are now being investigated by the US Homeland Security Department after they were intercepted by authorities in Greece.

… 

 

The shipments – one in Dec 2012 and the other last April – were sent by courier from the Israeli town of Binyamina-Givat Ada, near Haifa, via a company in Greece, the newspaper reported. The firm was later established to be a ghost company. Its contact number was said to belong to a British national in the Greek city of Thessaloniki, who could not be traced.

Was Mossad involved? But of course.

A blogger, Richard Silverstein pointed the finger at two possible culprits who he said were well-known arms dealers living in Binyamina-Givat Ada. The pair had come to the attention of Israeli and US authorities on suspicion of violating the arms embargo on Iran in the past, Silverstein wrote, but had never been charged or prosecuted. “There can be no doubt that they are colluding with Israeli intelligence,” he added.

For those who are not convinced, “The defence and foreign ministries in Israel declined to comment on the seizures, which were first revealed by Kathimerini, a Greek newspaper. “

Finally, tying it all together, is another report from Reuters. in which we learn that “as Syria’s war nears the start of its fourth year, Iran has stepped up support on the ground for President Bashar al-Assad, providing elite teams to gather intelligence and train troops, sources with knowledge of military movements say.“

This further backing from Tehran, along with deliveries of munitions and equipment from Moscow, is helping to keep Assad in power at a time when neither his own forces nor opposition fighters have a decisive edge on the battlefield.

Assad’s forces have failed to capitalize fully on advances they made last summer with the help of Iran, his major backer in the region, and the Hezbollah fighters that Tehran backs and which have provided important battlefield support for Assad.

 

But the Syrian leader has drawn comfort from the withdrawal of the threat of U.S. bombing raids following a deal under which he has agreed to give up his chemical weapons.

 

Shi’te Iran has already spent billions of dollars propping up Assad in what has turned into a sectarian proxy war with Sunni Arab states. And while the presence of Iranian military personnel in Syria is not new, military experts believe Tehran has in recent months sent in more specialists to enable Assad to outlast his enemies at home and abroad.

 

Assad’s forces have failed to capitalize fully on advances they made last summer with the help of Iran, his major backer in the region, and the Hezbollah fighters that Tehran backs and which have provided important battlefield support for Assad.

 

But the Syrian leader has drawn comfort from the withdrawal of the threat of U.S. bombing raids following a deal under which he has agreed to give up his chemical weapons.

 

Shi’te Iran has already spent billions of dollars propping up Assad in what has turned into a sectarian proxy war with Sunni Arab states. And while the presence of Iranian military personnel in Syria is not new, military experts believe Tehran has in recent months sent in more specialists to enable Assad to outlast his enemies at home and abroad.

To summarize: in an act of complete disregard for the official diplomatic song and dance, both Israel and the US are now providing military support to Iran, which in turn is providing military support to Syria, which is also getting military support from Russia. And now, just to make things more interesting, the same labyrinth of “military support” is about to be unleashed in the Ukraine, whose western half is just as likely getting arms and military equipment (not to mention funding)from the West under the table, while Russia, whose main Black Sea port is in the Ukraine’s Crimean peninsula, is arming the Eastern part of the Ukraine.

What can possibly go wrong?

via Zero Hedge http://ift.tt/1eo8c0T Tyler Durden

The last 3 weeks have seen the macro fundamentals of the G-10 major economies collapse at the fastest pace in almost 4 years and almost the biggest slump since Lehman. Despite a plethora of data showing that 'weather' is not to blame, US strategists, 'economists', and asset-gatherers are sticking to the meme that this is all because of the cold on the east coast of the US (and that means wondrous pent-up demand to come). However, as the New York Times reports, for the earth, it was the 4th warmest January on record.

 

G-10 macro data is collapsing…

 

Must be the weather in the US, right?

For people throughout the Eastern United States who spent January slipping, sliding and shivering, here is a counter-intuitive fact: For the earth as a whole, it was the fourth-warmest January on record.

As NY Times reports,

But this might be another surprise: Despite all the weather drama, it was not a January for the record books.

 

By the time analysts averaged the heat in the West and the cold in the East, the national temperature for the month fell only one-tenth of a degree below the 20th-century average for January. January 2011 was colder.

 

No state set a monthly record for January cold. Alabama, also walloped by the ice storms, came closest, with the fourth-coldest January on its record books.

 

 

The United States covers only 2 percent of the surface of the globe, so what happens in this country does not have much influence on overall global temperatures.

 

Brazil, much of southern Africa, most of Europe, large parts of China and most of Australia were unseasonably warm in January, the National Oceanic and Atmospheric Administration reported Thursday. That continues a pattern of unusual global warming that is believed to be a consequence of human-caused emissions of greenhouse gases.

 

Even in the United States, more than a third of the country is in drought of varying intensity. Mountain snowpack in many parts of the West is only half of normal, portending a parched summer and a likelihood of severe wildfires.

 

…

 

But the cold weather in the East is being balanced, in a sense, by the bizarrely warm temperatures in the West. And that trend, too, is likely to continue.

 

The outlook over the next month is for continued above-normal temperatures in the West, the Southwest and parts of Alaska, as well as a continuation of the California drought, despite recent rains that have eased the situation slightly.

Can we finally put to bed the "weather" meme and perhaps, just perhaps, recognize that the global economy is slowing as the animal spirits exuberance of global central bank liquidity pump-priming has simply run its course and faces the reality of a debt-saturated, growth-stifled reality.

As the following publicly available paper notes, the years of 2.0% 'trend' growth for the US are over...

The United States achieved a 2.0 percent average annual growth rate of real GDP per capita between 1891 and 2007. This paper predicts that growth in the 25 to 40 years after 2007 will be much slower, particularly for the great majority of the population. Future growth will be 1.3 percent per annum for labor productivity in the total economy, 0.9 percent for output per capita, 0.4 percent for real income per capita of the bottom 99 percent of the income distribution, and 0.2 percent for the real disposable income of that group.

 

 

The primary cause of this growth slowdown is a set of four headwinds, all of them widely recognized and uncontroversial. Demographic shifts will reduce hours worked per capita, due not just to the retirement of the baby boom generation but also as a result of an exit from the labor force both of youth and prime-age adults. Educational attainment, a central driver of growth over the past century, stagnates at a plateau as the U.S. sinks lower in the world league tables of high school and college completion rates. Inequality continues to increase, resulting in real income growth for the bottom 99 percent of the income distribution that is fully half a point per year below the average growth of all incomes. A projected long-term increase in the ratio of debt to GDP at all levels of government will inevitably lead to more rapid growth in tax revenues and/or slower growth in transfer payments at some point within the next several decades.

 

There is no need to forecast any slowdown in the pace of future innovation for this gloomy forecast to come true, because that slowdown already occurred four decades ago. In the eight decades before 1972 labor productivity grew at an average rate 0.8 percent per year faster than in the four decades since 1972. While no forecast of a future slowdown of innovation is needed, skepticism is offered here, particularly about the techno-optimists who currently believe that we are at a point of inflection leading to faster technological change. The paper offers several historical examples showing that the future of technology can be forecast 50 or even 100 years in advance and assesses widely discussed innovations anticipated to occur over the next few decades, including medical research, small robots, 3-D printing, big data, driverless vehicles, and oil-gas fracking.

 

NBER by zerohedge

via Zero Hedge http://ift.tt/1hfFYd5 Tyler Durden

The last 3 weeks have seen the macro fundamentals of the G-10 major economies collapse at the fastest pace in almost 4 years and almost the biggest slump since Lehman. Despite a plethora of data showing that 'weather' is not to blame, US strategists, 'economists', and asset-gatherers are sticking to the meme that this is all because of the cold on the east coast of the US (and that means wondrous pent-up demand to come). However, as the New York Times reports, for the earth, it was the 4th warmest January on record.

 

G-10 macro data is collapsing…

 

Must be the weather in the US, right?

For people throughout the Eastern United States who spent January slipping, sliding and shivering, here is a counter-intuitive fact: For the earth as a whole, it was the fourth-warmest January on record.

As NY Times reports,

But this might be another surprise: Despite all the weather drama, it was not a January for the record books.

 

By the time analysts averaged the heat in the West and the cold in the East, the national temperature for the month fell only one-tenth of a degree below the 20th-century average for January. January 2011 was colder.

 

No state set a monthly record for January cold. Alabama, also walloped by the ice storms, came closest, with the fourth-coldest January on its record books.

 

 

The United States covers only 2 percent of the surface of the globe, so what happens in this country does not have much influence on overall global temperatures.

 

Brazil, much of southern Africa, most of Europe, large parts of China and most of Australia were unseasonably warm in January, the National Oceanic and Atmospheric Administration reported Thursday. That continues a pattern of unusual global warming that is believed to be a consequence of human-caused emissions of greenhouse gases.

 

Even in the United States, more than a third of the country is in drought of varying intensity. Mountain snowpack in many parts of the West is only half of normal, portending a parched summer and a likelihood of severe wildfires.

 

…

 

But the cold weather in the East is being balanced, in a sense, by the bizarrely warm temperatures in the West. And that trend, too, is likely to continue.

 

The outlook over the next month is for continued above-normal temperatures in the West, the Southwest and parts of Alaska, as well as a continuation of the California drought, despite recent rains that have eased the situation slightly.

Can we finally put to bed the "weather" meme and perhaps, just perhaps, recognize that the global economy is slowing as the animal spirits exuberance of global central bank liquidity pump-priming has simply run its course and faces the reality of a debt-saturated, growth-stifled reality.

As the following publicly available paper notes, the years of 2.0% 'trend' growth for the US are over...

The United States achieved a 2.0 percent average annual growth rate of real GDP per capita between 1891 and 2007. This paper predicts that growth in the 25 to 40 years after 2007 will be much slower, particularly for the great majority of the population. Future growth will be 1.3 percent per annum for labor productivity in the total economy, 0.9 percent for output per capita, 0.4 percent for real income per capita of the bottom 99 percent of the income distribution, and 0.2 percent for the real disposable income of that group.

 

 

The primary cause of this growth slowdown is a set of four headwinds, all of them widely recognized and uncontroversial. Demographic shifts will reduce hours worked per capita, due not just to the retirement of the baby boom generation but also as a result of an exit from the labor force both of youth and prime-age adults. Educational attainment, a central driver of growth over the past century, stagnates at a plateau as the U.S. sinks lower in the world league tables of high school and college completion rates. Inequality continues to increase, resulting in real income growth for the bottom 99 percent of the income distribution that is fully half a point per year below the average growth of all incomes. A projected long-term increase in the ratio of debt to GDP at all levels of government will inevitably lead to more rapid growth in tax revenues and/or slower growth in transfer payments at some point within the next several decades.

 

There is no need to forecast any slowdown in the pace of future innovation for this gloomy forecast to come true, because that slowdown already occurred four decades ago. In the eight decades before 1972 labor productivity grew at an average rate 0.8 percent per year faster than in the four decades since 1972. While no forecast of a future slowdown of innovation is needed, skepticism is offered here, particularly about the techno-optimists who currently believe that we are at a point of inflection leading to faster technological change. The paper offers several historical examples showing that the future of technology can be forecast 50 or even 100 years in advance and assesses widely discussed innovations anticipated to occur over the next few decades, including medical research, small robots, 3-D printing, big data, driverless vehicles, and oil-gas fracking.

 

NBER by zerohedge

via Zero Hedge http://ift.tt/1hfFYd5 Tyler Durden

Social media is increasingly home to civil society. As Pew Research notes, it is the place where knowledge sharing, public discussions, debates, and disputes are carried out. As the new public square, social media conversations are therefore as important to document as any other large public gathering. By analyzing many thousands of Twitter conversations, Pew identified six different conversational archetypes. The following infographic describes each type of conversation network and an explanation of how it is shaped by the topic being discussed and the people driving the conversation.

 

 

Conversations on Twitter create networks with identifiable contours as people reply to and mention one another in their tweets. These conversational structures differ, depending on the subject and the people driving the conversation.

Six structures are regularly observed: divided, unified, fragmented, clustered, and inward and outward hub and spoke structures. These are created as individuals choose whom to reply to or mention in their Twitter messages and the structures tell a story about the nature of the conversation.

If a topic is political, it is common to see two separate, polarized crowds take shape. They form two distinct discussion groups that mostly do not interact with each other. Frequently these are recognizably liberal or conservative groups. The participants within each separate group commonly mention very different collections of website URLs and use distinct hashtags and words. The split is clearly evident in many highly controversial discussions: people in clusters that we identified as liberal used URLs for mainstream news websites, while groups we identified as conservative used links to conservative news websites and commentary sources. At the center of each group are discussion leaders, the prominent people who are widely replied to or mentioned in the discussion. In polarized discussions, each group links to a different set of influential people or organizations that can be found at the center of each conversation cluster.

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Still, the structure of these Twitter conversations says something meaningful about political discourse these days and the tendency of politically active citizens to sort themselves into distinct partisan camps.

 

And on a slightly less socio-economically serious side, here’s 10 curious facts about Twitter…

via Zero Hedge http://ift.tt/1hIPokK Tyler Durden