Friday A/V Club: A Nightmare Vision of a World Without Congress

Ever wonder what would happen if we woke up one day to find that
Congress has disappeared? Coronet Instructional Films explores this
horrific world in 1947’s The Powers of Congress. The
courts would collapse! Texas would have its own army! And
without any regulations restraining it, a railroad would be free to
charge you $600 for a ticket! That’s 600 New York dollars,
of course, since Washington would be out of the currency business.
Watch and learn, libertarian!

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General Motors’ Bailout Still Screwing Over Americans

GM’s newbie CEO Mary Barra
apologized
to the customers of its recalled Cobalt and other
cars in the USA Today this week. “We are deeply sorry for
the lives lost and the lives it has affected.” GM is now guided by
three things, she said: “The customer is our compass, relationships
matter and individual excellence is crucial.

But if she were serious about the customer part, the last thing
she would be doing is trying to screw him/her over by hiding behind
the liability shield that GM got from the administration as part of
the bailout.

As I note in my own column in the USA Today this
morning, this shield means GM is not liable for any incidents
involving its vehicles prior to its bankruptcy, even though it knew
that Cobalt’s faulty ignition had the dangerous tendency of turning
off a moving vehicle and preventing the airbags from deploying.
This problem has been linked to 31 crashes and 12 deaths.Chrysler
got an even sweeter deal and is not responsible for even the
post-bankruptcy incidents involving any of vehicles that were on
the road at the time of bankruptcy, a deal GM also wanted but was
denied.

George Mason University’s Todd Zywicki told me that a liability
shield isn’t unusual in bankruptcy cases. But what is unusual is
that GM and Chrysler weren’t required to put money in special trust
funds for prospective victims. Instead, the corporate giants can
treat injured customers as shabbily as unsecured creditors. What
little compensation that is available will come from the sale of
closed GM plants being held in a shell corporation.

Go
here
to read the whole thing, but if Barra truly cared about
GM’s customers, she would forego the shield and offer the
plaintiffs in a class action suit filed against it last week just
compensation.

Call me cynical, but somehow I’m getting the feeling that she
doesn’t care that much.

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A.M. Links: Putin Finalizes Crimea Annexation, Still No Sign of Malaysia Airlines Flight 370, Turkey Bans Twitter

  • Russian President Vladimir Putin signed a treaty that formally

    annexes Crimea
    . Ukrainian Prime Minister Arseniy Yatsenyuk
    signed an agreement on closer relations with the
    European Union
    .
  • Search teams looking for the possible debris of
    Malaysia Airlines Flight 370
    seen on satellite images have
    found nothing.
  • Sen. Harry Reid (D-Nev.) ordered an investigation into the
    CIA’s alleged
    spying
    on the Senate Intelligence Committee.
  • Turkey
    banned Twitter
    , the social media site that is being used to
    share evidence of alleged corruption within Prime Minister Tayyip
    Erdogan’s inner circle. Erdogan said, “We’ll eradicate Twitter. I
    don’t care what the international community says.” Thankfully,
    Turks can still tweet via text.
  • Brigadier General Jeffrey A. Sinclair
    avoided jail time
    and was ordered to give up $5,000 per month
    for four months by the judge overseeing his sexual misconduct
    trial.
  • President Barack Obama told Democratic donors that Democrats
    usually
    “get clobbered” in midterms
    “either because we don’t think it’s
    important or we’ve become so discouraged about what’s happening in
    Washington that we think it’s not worth our while.”

Follow us on Facebook and Twitter,
and don’t forget to
 sign
up
 for Reason’s daily updates for more
content.

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Kurt Loder Reviews Divergent and Nymphomaniac: Volume I

Kurt Loder
reviews Divergent and Nymphomaniac: Volume I. Of
the latter, he writes, any movie containing lines like “I’ve always
demanded more of the sunset” and “I’m extremely fond of my hamster”
is a comedy in my book. The latest provocation from Danish director
Lars von Trier is heavy with sex, much of it prosthetically
effected, some of it graphic—the old in-out, in-out for real. (Porn
doubles provide the naughty bits.) But the film is also about fly
fishing, cake forks and Fibonacci numbers, among several other
things, and while it suggests interesting carnal-artistic
connections, giggles are sometimes hard to suppress.

View this article.

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Canadian Province Considers Russian Booze Ban

Sanctions against billionaires – that’s one (very much meaningless) thing. But halting sales of Russian vodka, now that could really cripple someone, just not clear who. And in an attempt to answer that question, the premier of Canada’s Saskatchewan province, Brad Wall, says he is considering banning Russian booze in government-run liquor stores because of Russia’s actions in Ukraine. Wall says it’s a small measure, but sends a strong statement.

Yes, well, rhetoric is one thing. The realization that trade is bilateral (as both the EU and USA have realized in recent days), something completely different. Which is why despite the posturing, don’t hold your breath. As Globanews reports, “Wall says trade issues have to be considered because Saskatchewan manufacturers sell shortline rail equipment into Russia…. the premier cautions that international trade can be complicated, so the province wants to work with the federal government to find out what trade sanctions are in the works.” Here’s the answer: none.

Still, this is a good marketing campaign for domestic booze makers nonetheless.

The Saskatchewan Liquor and Gaming Authority carries Russian Standard Vodka.

Why Saskatchewan? “Political violence in Ukraine hits home for many people in Saskatchewan where about 13 per cent of the population has Ukrainian roots.”

Finally, there would be nothing quite like sending the price of Russian booze soaring, leading to bumper profits for producers and bootleggers, if indeed someone were to arbtirarily halt such a “liquid” trade channel. Which is why it will never happen. Just like nobody will ever say no to that other “liquid” Russian exports, no matter tha posturing – crude oil.


    



via Zero Hedge http://ift.tt/1r4Tgyc Tyler Durden

Frontrunning: March 21

  • Australia says nothing spotted in search for plane (AP)
  • Putin looks to Asia as West threatens to isolate Russia (Reuters)
  • China Billionaire Builds Metals With Dreyfus, Glencore Hires (BBG)
  • China Beige Book Says Economy Slowing (BBG)
  • Caterpillar Said to Be Focus of Senate Overseas Tax Probe (BBG)
  • US Cancels Summit With Divided Group of Gulf Nations (WSJ)
  • Cyprus defense minister suffers aneurysm (AP)
  • Abe to zero in on economy as tax hike looms (Nikkei)
  • Europe strikes deal to complete banking union (Reuters)
  • Barclays Said to Miss Alibaba Fees by Defying SoftBank’s Son (BBG)
  • Tiffany posts 4Q loss due to large charge (AP)
  • Gunmen ram explosives-laden tanker into Iraq police HQ, killing many (Reuters)

 

Overnight Media Digest

WSJ

* U.S. President Barack Obama ordered a second round of financial sanctions on Russian officials and a St. Petersburg bank over Crimea, and the European Union added names to its sanctions list. Moscow responded with penalties against nine U.S. officials. (http://ift.tt/1hMXG6s)

* The Federal Reserve’s annual test of big banks’ financial health showed the largest U.S. firms are strong enough to withstand a severe economic downturn, a sign that many will get the green light soon to reward investors by raising dividends and buying back shares. The Fed said 29 of the 30 largest institutions have enough capital to continue lending even when faced with a hypothetical jolt to the U.S. economy lasting into 2015, including a severe drop in housing prices and a spike in unemployment. (http://ift.tt/1oEpA96)

* Symantec Corp, the computer-security company synonymous with “antivirus,” fired Chief Executive Steve Bennett amid sagging revenue and slumping shares, the second time it has dumped a CEO in less than two years. (http://ift.tt/1jbdWU8)

* Airbnb Inc, which once sold novelty cereal boxes to stay afloat before emerging as a threat to the hotel industry, is close to becoming one of the world’s most valuable startups. The online service that lets people rent their homes to travelers is in advanced talks to raise capital that would value it at about $10 billion. (http://ift.tt/1oEpxtU)

* Major bitcoin exchange Mt. Gox said it found nearly a quarter of the bitcoins it previously said were lost, raising questions about how much of the missing total could eventually be recovered. (http://ift.tt/1jbdW6L)

* The White House is testing smartphones from Samsung Electronics and LG Electronics Inc for internal use, threatening one of the last and most high-profile strongholds of BlackBerry Ltd. (http://ift.tt/1oEpA98)

* Exxon Mobil Corp has agreed to disclose how the regulation of carbon emissions could affect the value of its oil and gas holdings, a sign that America’s biggest energy company is stepping up efforts to address shareholders’ environmental concerns. (http://ift.tt/1jbdWUg)

* Hewlett-Packard Co shareholders have forgiven three company directors they heavily criticized for presiding during some of the firm’s most troubled periods. The company’s longest-serving directors Marc Andreessen, Raymond Lane and Rajiv Gupta, were re-elected by shareholders at HP’s annual meeting on Wednesday, the results weren’t released. (http://ift.tt/1oEpA9d)

 

FT

Airbnb is in talks with private equity firms including TPG Capital Management LP to raise funds that would price the online home-rental marketplace at about $10 billion.

Netflix Inc has accused big internet providers, including Comcast Corp, of using their “market position” to impose tolls for access to their networks, hindering the online video operator’s ability to provide a quality service.

Turkey blocked access to Twitter on Thursday, after Prime Minister Tayyip Erdogan vowed to eradicate the social media site for national security reasons as he battles a damaging corruption scandal.

Chinese e-commerce giant Alibaba Group <IPO-ALIB.N> has invested $215 million in mobile messaging app-maker Tango, valuing it at $1 billion.

Chemicals producer Ineos has accused Asia’s biggest refiner Sinopec Corp of breaching its intellectual property rights over the manufacture of a key industrial compound.

 

NYT

* U.S. President Barack Obama expanded sanctions against Russia on Thursday, blacklisting a bank and several wealthy businessmen with close ties to President Vladimir Putin, as the United States struggled to forestall further Russian incursions into Ukraine. (http://ift.tt/1jbdWUl)

* Technology companies have spent months denying they know anything about broad government spying on people who use their Internet services. But a legal case filed this week against a former Microsoft Corp employee shows the power these companies themselves have to snoop on their customers whenever they want to. (http://ift.tt/1oEpApx)

* Nearly all of the United States’ largest banks have adequate capital to withstand a severe economic downturn and market turmoil, the Federal Reserve has found in its latest annual stress test of the country’s financial system. (http://ift.tt/1jbdW6P)

* Airbnb, the company that was created nearly six years ago as a way to help people find spare rooms and couches to sleep on, is in advanced talks to raise more than $400 million in capital, a round of financing that would value it at more than $10 billion. (http://ift.tt/1oEpxu4)

* Credit Suisse has hired a new head of its power and renewables investment banking group from RBC Capital Markets, the firm announced in an internal memo on Thursday. (http://ift.tt/1jbdWn5)

 

Canada

THE GLOBE AND MAIL

* Canada is looking seriously at levying punitive sanctions against firms in Russian business sectors over Moscow’s seizure of Crimea, an increase in pressure under consideration as Prime Minister Stephen Harper heads to Ukraine to show solidarity with the beleaguered country. (http://ift.tt/1oEpxu6)

* On Friday, the Canadian Supreme Court will rule on whether Prime Minister Stephen Harper’s latest appointee to that court, Justice Marc Nadon of Quebec, has the legal qualifications for the job. (http://ift.tt/1jbdWn9)

Reports in the business section:

* U.S. retailer Nordstrom Inc will delay bringing its low-cost Rack stores to Canada, as it looks to contain expenses and avoid a repeat of Target Corp’s fumbled debut. (http://ift.tt/1oEpxKk)

NATIONAL POST

* Canada’s Conservative government wants to hear from the public about how to rewrite the prostitution laws that were struck down by the Supreme Court late last year. A month-long, online consultation period on the Justice Canada website began Monday and runs to March 17. (http://ift.tt/1jbdXaE)

FINANCIAL POST

* Valero Energy Corp, owner of Canada’s second-largest oil refinery, is working to source the Lévis, Quebec facility’s entire crude oil supply from North America by the end of 2014. The shift would mark a break from the refinery’s near-complete dependence on so-called Atlantic basin crude from Algeria and other overseas nations for the past several decades. (http://ift.tt/1oEpxKm)

* Merchant Law Group LLP, a Canadian class-action law firm, is going after General Motors Co for the automaker’s handling of defective ignition switches in 1.6 million small cars worldwide, including about 235,000 cars sold in this country. (http://ift.tt/1jbdXaG)

 

China

SHANGHAI SECURITIES NEWS

– China Hi-Tech Group Corp will repurchase all H shares of its listed subsidiary Jingwei Textile Machinery Co Ltd with a premium of 30 percent, the company said in a statement.

SECURITIES TIMES

– Hot rolled coils futures starts trading at Shanghai Futures Exchange on Friday with the benchmark price being 3316 yuan per tonne, according to a statement on its website.

NATIONAL BUSINESS NEWS

– China’s urbanization rate is expected to reach 60 percent by 2020, demanding investment of more than 42,00 billion yuan, the vice minister of the Ministry of Finance said. The investment will mainly come from private investors, he added.

21ST CENTURY BUSINESS HERALD

– China’s central bank said in a closed-door meeting that it would not change its supportive stance toward online financing industry, sources told the paper. This comes after it suspended the QR code payment service last week.

CHINA DAILY

– China should maintain diversity in its urbanization process and not harm the cultural and historical heritage preserved in its numerous villages and small towns, an editorial said.

PEOPLE’S DAILY

– The key of the success of China’s ongoing political and economic reform is the enforcement of the pronounced reform policies, the paper which acts as the party’s mouthpiece said in an editorial.

Britain

The Telegraph

BG GROUP PUTS 1,100 UK JOBS AT RISK

Up to 1,100 jobs are at risk at BG Group’s head office in Reading, England after the energy company started a redundancy programme. (http://ift.tt/1j9YgAA)

LIDL CHAIRMAN IN SHOCK EXIT OVER STRATEGY DIFFERENCES

The chairman of budget food retailer Lidl has abruptly resigned due to “unbridgeable” future strategy differences.(http://ift.tt/1j9Yfwu)

The Guardian

BP DRAWN INTO ROW OVER RUSSIA’S ANNEXATION OF CRIMEA

BP has been sucked into the row over Russia’s annexation of Crimea with calls for the delisting from the London Stock Exchange of Rosneft, the Moscow-based oil company in which the British group has a 20 percent holding. (http://ift.tt/1gZ57pr)

NEXT’S PROFITS SET TO OVERTAKE MARKS & SPENCER AFTER 12 PCT ANNUAL RISE

The decline of Marks & Spencer was again brutally underlined on Thursday when Next reported soaring profits that are almost certain to have beaten its venerable high street rival for the first time. (http://ift.tt/1gZ57px)

The Times

MULBERRY CHIEF EXECUTIVE QUITS IN WAKE OF PROFIT WARNING

Designs on pushing Mulberry Group upmarket have received a setback with the resignation of its chief executive only two years after he was appointed. (http://ift.tt/1j9YgQY)

POOR CUSTOMER SERVICE HITS RYANAIR CREDIT RATING

Ryanair’s reputation for abysmal customer service has resulted in a maiden credit rating for the budget airline of three notches above junk. (http://ift.tt/1j9YfMX)

INTU TAPS MARKET TO RAISE MONEY FOR MALLS

Intu Properties has defended its decision to buy three shopping centres from the Westfield Group for 868 million pounds ($1.43 billion) and fund the purchase through a deeply discounted 500 million pound rights issue. (http://ift.tt/1j9YgR4)

The Independent

BLOW FOR SCOTTISH NATIONALISTS AS BAE SAYS SPLIT WOULD DESTROY JOBS

The defence giant BAE Systems has finally warned that Scottish independence could threaten thousands of jobs north of the border, after months of refusing to comment on September’s vote. (http://ift.tt/1j9YgR8)

FAMILY WINS RIGHT TO SUE RBS OVER THEIR LOST FIRM

A family have won a landmark case giving them the green light to sue Royal Bank of Scotland Group for millions over the alleged mis-selling of interest rate swaps that ultimately left them with crippling borrowing costs on a 55 million pound loan. (http://ift.tt/1j9YgRc)

TRADER FINED AND BANNED FOR TRYING TO RIG UK BOND MARKET

A top trader was fined nearly 700,000 pounds and banned for life for manipulating the price of government bonds in an attempt to profit from the taxpayer-backed money printing programme known as QE. (http://ift.tt/1gZ57G7)

Fly On The Wall 7:00 AM Market Snapshot

ECONOMIC REPORTS

No domestic economic reports of note are scheduled today.

ANALYST RESEARCH

Upgrades

City National (CYN) upgraded to Outperform from Market Perform at Wells Fargo
Ensco (ESV) upgraded to Buy from Neutral at Guggenheim
Exelon (EXC) upgraded to Outperform from Neutral at Credit Suisse
JDSU (JDSU) upgraded to Buy from Neutral at MKM Partners
Posco (PKX) upgraded to Buy from Neutral at Citigroup
Progressive (PGR) upgraded to Outperform from Market Perform at William Blair
United Technologies (UTX) upgraded to Buy from Neutral at Goldman

Downgrades

Boeing (BA) downgraded to Neutral from Buy at Goldman
Community Health (CYH) downgraded to Fair Value from Buy at CRT Capital
ConAgra (CAG) downgraded to Neutral from Buy at Goldman
Equity One (EQY) downgraded to Hold from Buy at MLV & Co.
Lennar (LEN) downgraded to Neutral from Positive at Susquehanna
Symantec (SYMC) downgraded to Hold from Buy at Jefferies
Symantec (SYMC) downgraded to Market Perform from Outperform at Cowen
Symantec (SYMC) downgraded to Neutral from Buy at UBS
Symantec (SYMC) downgraded to Neutral from Outperform at RW Baird
Symantec (SYMC) downgraded to Sell from Buy at MKM Partners
Walgreens (WAG) downgraded to Sell from Hold at Cantor

Initiations

Apple (AAPL) initiated with an Outperform at Macquarie
Cardiovascular Systems (CSII) initiated with a Strong Buy at Needham
DexCom (DXCM) initiated with a Neutral at Sterne Agee
Erickson Air-Crane (EAC) initiated with a Hold at Canaccord
Insulet (PODD) initiated with a Buy at Sterne Agee
Keryx (KERX) initiated with a Buy at Mizuho
New York Mortgage (NYMT) initiated with a Buy at UBS
Primo Water (PRMW) initiated with a Buy at B. Riley
Spectranetics (SPNC) initiated with a Buy at Needham
Tandem Diabetes (TNDM) initiated with a Neutral at Sterne Agee
Volcano (VOLC) initiated with a Hold at Needham

COMPANY NEWS

The Federal Reserve released stress test results, said banks ‘collectively better positioned’
Netflix (NFLX) CEO said net neutrality ‘must be defended and strengthened’
Nike (NKE) warned that the impact from foreign currencies will impact its Q4 and FY15 results
Golden Gate Capital reported a 9.5% stake in Ann Inc (ANN), and said it intends to, “leverage [its] significant retail expertise and public and private equity experience to assist in creating value for the company’s shareholders
Aveo Pharmaceuticals (AVEO) said it regained worldwide rights to to AV-203, a clinical-stage inhibitory antibody candidate, from Biogen (BIIB)
Symantec (SYMC) terminated the employment of its CEO, Steve Bennett, and named Michael Brown as interim CEO

EARNINGS

Companies that beat consensus earnings expectations last night and today include:
Silver Wheaton (SLW), Rally Software (RALY), Nike (NKE), Envivio (ENVI), New York & Co. (NWY), TIBCO (TIBX)

Companies that missed consensus earnings expectations include:
Aeterna Zentaris (AEZS), Shoe Carnival (SCVL), AAR Corp. (AIR)

NEWSPAPERS/WEBSITES

General Motors (GM) CEO to testify before congressional comittee on April 1, WSJ says
Microsoft (MSFT) admits reading Hotmail inbox of blogger, AP reports
Sprint (S) to close three call centers, 55 stores, Re/code reports
Defense companies (LMT, UTX, RTN, GD) find new focus in working against hackers, WSJ reports
Caterpillar (CAT) at center of Senate overseas tax investigation, Bloomberg says
Deutsche Bank (DB) fails to end four U.S. lawsuits over soured mortgages, Reuters reports
Twitter (TWTR) banned in Turkey, VentureBeat says
Judge urges deeper Toyota (TM) probe to include employees, WSJ reports

SYNDICATE

A10 Networks (ATEN) 12.5M share IPO priced at $15.00
Amber Road (AMBR) 7.4M share IPO priced at $13.00
Borderfree (BRDR) 5M share IPO priced at $16.00
China Mobile Games (CMGE) 3.442M share Secondary priced at $24.00
EnLink Midstream Partners (ENLK) files to sell 17.99M common units for holders
Foundation Medicine (FMI) files to sell $150M of common stock
KB Home (KBH) 6.94M share Secondary priced at $18.00
PBF Energy (PBF) files to sell 15M shares of Class A common stock for holders
Sangamo (SGMO) 4.44M share Secondary priced at $22.50
Seacoast Banking (SBCF) files $150M mixed securities shelf
Sonus Networks (SONS) files to sell 43.125M shares for holders
TPG Specialty Lending (TSLX) 7M share IPO priced at $16.00
Tableau (DATA) 4M share Secondary priced at $89.25
TherapeuticsMD (TXMD) 9M share Secondary priced at $7.10
Versartis (VSAR) 6M share IPO priced at $21.00
Wix.com (WIX) files to sell $86.25M of ordinary shares


    

via Zero Hedge http://ift.tt/1fM1jHf Tyler Durden

Putin Signs Crimean “Absorption” Law, Asks To Have His Salary Transferred Into Sanctioned Bank Rossiya

Moments ago the “absorption” of Crimea into the Russian Federation was completed after Putin signed the final previously passed by parliament. And with that, in less than a month, the Crimean “question” has been answered. The only question is whether Putin will stop here or will the ease with which he just expanded the Russian political map leave him hungry for more.

In other news, as part of the Western escalations against Russia, Bank Rossiya, the one bank exclusively identified in the sanctions list, announced that Visa and MasterCard have stopped, without notification, providing services for payment transactions for clients. Another bank that saw the drop of merchant credit card services was SMP bank, co-owned by brothers Boris and Arkady Rotenberg, who were also on the latest U.S. sanctions list.

SMP bank said in a statement that it considered the credit card giants’ move unlawful, because the U.S. sanctions targeted shareholders and not the bank itself, Reuters reported Friday.

Earlier in the day, Bank Rossiya said it was working in a “stable regime” and was taking all the necessary legal measures to defend its rights and its clients’ rights and legal interests.

“In connection with the information about U.S. sanctions being imposed on Rossiya we can report that the bank is working in a stable regime. The bank is meeting and will, without a doubt, fully meet all its obligations to its clients and partners,” the bank said in a statement.

“The management of Rossiya understands the difficulties of clients in the current situation and will do all it can to solve them,” the bank said in a statement.

These moves in turn promptly led to Putin announcing that he wants to open an account with the Bank Rossiya. From Moscow Times:

“I don’t have an account there, but I will certainly open one there on Monday,” Putin said Friday, while speaking at a Security Council meeting, Interfax reported.

Putin later asked for his salary to be transferred to Bank Rossiya and ordered Russia’s Central Bank to take the sanction-hit lender’s clients under protection and provide all possible assistance to them, The Associated Press reported.

U.S. President Barack Obama on Thursday announced that Washington was levying a new round of sanctions affecting 20 Russian officials and businessmen, but also Bank Rossiya, which is chaired and part owned by businessman Yuri Kovalchuk, who is one of the 20.

Why was the bank singled out?

The United States Treasury Department stated that Bank Rossiya is used by senior Russian officials and that its shareholders include members of Putin’s inner circle.


    



via Zero Hedge http://ift.tt/1iJXHe3 Tyler Durden

Turkey PM Acts On His Threat To “Destroy Twitter”, Blocks Countrywide Access

When we reported early yesterday that Turkey’s Prime Minister Erdogan warned that since Twitter had ignored court orders to remove content related to a government corruption scandal., that he would “destroy Twitter” and that “we’ll dig up Twitter – all of them – from the roots,” he raged, “they’ll see the power of the Republic of Turkey” it may not have been quite clear what he meant. A few hours later it was revealed, when virtually all Twitter access was blocked in Turkey ten days ahead of the general election in a move that has already enraged the nation and resulted in a powerful public outcry.

Bloomberg reports that the “tweets targeted by the premier are from two anonymous users: one going by the name of Haramzadeler, a phrase translated by Turkish media as “Sons of Thieves” though it could also mean “bastard,” and another called Bascalan, or “Prime Thief.”  The person or persons have been leaking documents and audio files, some described as the results of a 15-month prosecutor-led investigation into corruption in Erdogan’s government. The leaks have captured the attention of Turkey’s 74 million citizens as the prime minister prepares for local elections on March 30. Zero Hedge reported on the leaks one month ago, which revealed that the PM and his sons were scrambling to hide their stolen money from the local prosecution during an anti-corruption raid in late 2013.

The leaks also call into question everything from the financial probity of ministers to their religious piety, and provide evidence of a media browbeaten by the government. That’s enlivened the opposition and put Erdogan on the defensive amid public allegations of graft involving the premier’s family and businessmen who’ve profited during his 11 years in power.

 

Turkey’s Information Technology and Telecommunications Board, or BTK, said Twitter had been blocked upon “complaints from our citizens” and “violations of personal rights and privacy,” according to a statement on its website today.

 

“The Internet site called Twitter has ignored decisions made by the courts of the Republic of Turkey,” the board said in the statement. “Left with no other choice to prevent the incompensable victimization of our citizens, a preventive measure blocking access to Twitter has been imposed in line with court decisions.”

Of course, the sheer idiocy of hoping to spread information by blocking one medium needs no commentary. What is worse for the embattled corrupt PM, however, is that worse revelations are coming.

Local media has reported that the most damaging leaks were yet to come. In a column in Yeni Safak newspaper yesterday, Hayrettin Karaman, a retired professor of Islamic law, pre-emptively denied the validity of a tape he said would be aired, showing him advising Erdogan on whether Islam would permit him to order the killing of politician Muhsin Yazicioglu, who died in a helicopter crash on March 25, 2009.

 

Yesterday, a prominent Turkish news anchorwoman denied rumors of a sexual affair with the prime minister. The pro-government media had been warning this week that new leaks would use “Hollywood” technology including silicon masks to make actors look like recognizable Turkish personalities.

 

While the original investigation stalled after prosecutors were removed, laws changed and thousands of police officers transferred, some of the files leaked from “Haramzadeler” have been incorporated into parliamentary record by the opposition.

As for the explanations from Erdogan, they have long since moved beyond the merely ridiculous:

Speaking across Turkey, Erdogan has dismissed one recording as a “montage,” described another as “natural” and said the entire investigation is backed by “foreign powers” and spearheaded by followers of a U.S.-based Islamic cleric, Fethullah Gulen. The latter has denied the allegations.

Regardless, the leaks are set to go on.

In a message on Twitter on March 19, “Haramzadeler” promised the leaks would continue until municipal elections and beyond.

“These publications will continue not just until March 30, but until Turkey sees the whole truth,” according to the post.

And since Turkey will certainly not stop at just Twitter, here is what is coming next: “Last week, Erdogan said the country could also block Facebook and YouTube.” One wonders how long until other despotic regimes – the Eurozone comes to mind – encourage Erdogan and decide to adopt some of his more radical measures.


    



via Zero Hedge http://ift.tt/1jb6AQB Tyler Durden

Bounce In Chinese Equities Pushes US Futures Higher

Once again there has been little fundamental news or economic data this morning in Europe with price action largely driven by expiring option contracts. In terms of key events, Putin says Russia should refrain from retaliating against US sanctions for now even as Bank Rossiya discovered Visa and MasterCard have stopped servicing its cards, and as Putin further added he would have his salary sent to the sanctioned bank – the farce will go on. Continuing the amusing “rating agency” news following yesterday’s policy warning by S&P and Fitch on Russian debt (was that a phone call from Geithner… or directly from Obama), Fitch affirmed United States at AAA; outlook revised to stable from negative, adding that the US has greater debt tolerance than AAA peers. Perhaps thje most notable move was in Chinese stocks which rallied overnight after major domestic banks said to have stopped selling trust products which were blamed for encouraging reckless borrowing and diluted credit standards. Speculation of further stimulus and the potential introduction of single stock futures also helped the Shanghai Comp mark its biggest gain of 2014 closing up 2.7%.

Despite expectations to the contrary, EM held up better than expectations yesterday. Indeed, some hoped that January’s selloff had strengthened EM positioning and valuations to better withstand a shift in Fed policy. Meanwhile other theories suggested that EM faces a delayed reaction to the Fed’s policy shift, much like January’s selloff came a month after the Fed’s taper announcement in December. Either way, a number of EMFX bellwethers including the BRL, MXN and TRY appreciated by 0.9%, 0.2% and 0.5% respectively against the USD yesterday. Rates markets were generally about 5- 10bp weaker across the board while EM sovereign credits were also wider. In Turkey, Prime Minister Erdogan surprised many by vowing to block access to Twitter immediately for national security reasons.

Turning to the day ahead, there’s not a lot on the data docket but the focus will be on speeches from four Fed officials which are the first speakers from the Fed since Wednesday’s FOMC. Perhaps we’ll get a clarification or elaboration of the Fed’s message from Wednesday. Bullard speaks on a Brookings Panel on the topic of nominal GDP. Fisher discusses the pros and cons of forward guidance. Kocherlakota and Stein will be speaking in Washington on monetary policy.

EU & UK Headlines

Little European news flow however analysts at Barclays believe that there is a risk of hawkish surprises from the BoE with any upside surprises in data could very well cause the timing of the first hike to get pulled forward.

US Headlines

Fitch affirmed United States at AAA; outlook revised to stable from negative, adding that the US has greater debt tolerance than AAA peers.

Analysts at Goldman Sachs still believe a hike to the Federal Funds rate is far off, noting that Yellen did not mean to send a strong signal on the shift in the reaction function. GS central forecast for the first hike remains early 2016, with risks of an earlier hike.

Equities

Stocks are seen higher across the board, with basic materials and telecommunications outperforming, although there was lack of tier 1 macroeconomic data releases or fresh macroeconomic news flow. Of note, German DAX index outperformed its peers, with Commerzbank leading the move higher following a positive broker recommendation by Morgan Stanley, with the bank also stating this morning that its 2013 capital target was reached.

In the US, the quarterly rebalance affects the S&P 500, S&P MidCap 400, and S&P SmallCap 600 indices.

Today also sees quadruple witching in the US, with the expiration of equity index futures, equity index options, stock options and single stock futures.

FX

AUD/USD edged up overnight and in Europe this morning towards its 200DMA line, supported by recovering gold prices as market participants looked to take advantage of weakness in spot prices throughout the week. Elsewhere, EUR/USD and GBP/USD are seen in minor positive territory, benefiting from a weaker USD amid profit taking following Yellen inspired gains. USD/CNY traded above its old 1% band for the third consecutive day printing a 13 month high. Analysts are now suggesting 6.25, rather than 6.20, is a key level to watch now that USD/CNY has traded above 6.20 for a number of days with little fall out from structured product unwinds.

Commodities

German Chancellor Merkel says EU leaders asked European Commission to prepare for possible broad economic sanctions against Russia over Crimea.This follows similar actions by Obama yesterday, who was preparing a bill for Congress on sanctions against ‘key sectors’ of the Russian economy. (BBG/RANsquawk) However Russian President Putin says Russia should not use retaliatory sanctions yet.

– Energy and precious metal prices, in particular palladium advanced to its highest level since September 2011 on fears that sanctions imposed on Russia will hamper exports channels. (Of note, Russia provided 41% of global palladium supply)

CME group said yesterday it is to launch shorter-term weekly energy options in April, in a bid to boost trading volumes. (RTRS)

Goldman Sachs says accelerating US growth to send gold price lower.

The Full Overnight Recap from DB’s Jim Reid

On Wednesday it felt a bit like the Fed had removed a support post from the market with the conclusion of the FOMC meeting but yesterday stronger data went some way to ease concerns about a potentially more hawkish Fed. This story will run and run with the Fed seemingly now in play again from a traditional policy point of view and maybe we will get a bit more market volatility to data now that the Fed has shifted away from quantitative thresholds. Within DB there is a school of thought that the Fed wasn’t actually as hawkish as has been made out but have indeed been fairly consistent in their views. Instead the argument goes that the market had perhaps become overly sanguine in recent weeks. Others think there were discrepancies between the statement, the press conference and the dots which might need ironing out by Fed speak which as you’ll see at the end starts again today with a few members appearing in public. We still think the Fed will find it much harder than it thinks to raise rates but with US data likely to now start seeing payback from the weather we could get a few months where the Fed’s own expected path seems rational. We may not know the true health of the US economy until the summer.

After underperforming Europe and the US yesterday, Asian equity markets are trading with a firmer tone this morning but volumes are on the low side with Japanese markets closed for holidays. Despite the better tone, sentiment remains fairly sensitive to the news flow from China. Chinese listed property developers are again outperforming (Shanghai Property equity index +3.1% vs Shanghai Comp +2.0%) after news that the Chinese securities regulator is reviewing the share-sale applications for three additional property developers. This comes after news that the regulator had approved share-sale applications for two developers yesterday. This is increasing optimism onshore that the government’s tightening stance on the sector may be coming to an end. In contrast, perhaps in a sign of the authorities’ stricter approach to the country’s trust sector, two of China’s biggest four banks (ICBC and CCB) are said to have halted selling trust products to third parties according to local media reports (Securities Journal, 21C Business Herald). This will only serve to tighten liquidity that flows to this sector. On a similar theme, we wrote yesterday that Shanxi-based steelmaker Highsee Group was the latest in a line of Chinese corporates reportedly getting into distress after the company failed to meet a RMB3bn bank loan repayment last week. It seems that the story has gotten more airplay overnight and local media are reporting that the company’s furnaces have already been shuttered and employees have not been paid (21st Century Biz Herald). It’s likely these kind of stories will continue to pop up in China this year reflecting tougher funding conditions for a number of sectors.

Coming back to yesterday, equities got a boost as the US session started helped by better than expected US data in the form of initial jobless claims (320k vs 322k expected) and the Philly Fed survey (9.0 vs 3.2 expected). More broadly the Bloomberg US Economic Surprise index has shown a steady improvement in March since bottoming out in February. DB’s Joe Lavorgna thinks that early March US data has been encouraging enough (particularly in the labour market) for him to revise up his March payrolls forecast to +275k from +225k previously. The S&P 500 ended up closing near the highs of +0.6%, leaving it within striking distance of March 7th’s record high of 1878.

Yesterday’s rally in equities was also driven by strong performance in the US banks. After the market close, the Fed published the results of its annual bank stress tests. All but one of the 30 US banks tested met or exceeded the Fed’s minimum capital targets under various scenarios. Under a severe adverse scenario, Zions Bancorp was the only bank with T1 capital below 5%, but the bank said that it would resubmit its capital plan after selling some CDOs to reduce risk. A number of bulge bracket banking stocks were up 2-3% in aftermarket trading. Also happening after market, Fitch affirmed the US’ AAA rating and took its rating outlook off watch negative to stable. Fitch cited that there has been stronger fiscal consolidation and signs of coherent economic policymaking.

In fixed income, European rates were weaker across the board as they reacted to Wednesday’s FOMC. Gilts, bunds and BTPs added 7bp, 5bp and 3bp respectively. US 10yr yields were relatively stable, adding 0.3bp, but weakening marginally following the US data. The front end of the UST curve was relatively stable (compared to Wednesday post-FOMC) and bear flattener trades have done well in the last 24 hours. As expected the post-FOMC analysis was a major discussion point for markets yesterday. On this topic, the WSJ said that Yellen’s first FOMC as Fed Chair highlighted the challenge that she faces in maintaining consensus on the Committee, highlighting the differences between some of her statements and the “dots” representing individual Fed official’s rate projections. Perhaps indicative of Yellen’s consensus building approach, the WSJ’s Fed-watcher Jon Hilsenrath noted that Yellen used the word “committee” 58 times in her one-hour news conference, more often than she uttered the words inflation, unemployment or economy. An additional 27 times she referred to the informal name of the Fed’s policy committee, FOMC, short for Federal Open Market Committee. Her predecessor, Ben Bernanke, by contrast, referred to the committee 24 times and to the FOMC 10 times in his last news conference in December (WSJ).

Despite expectations to the contrary, EM held up better than expectations yesterday. Indeed, some hoped that January’s selloff had strengthened EM positioning and valuations to better withstand a shift in Fed policy. Meanwhile other theories suggested that EM faces a delayed reaction to the Fed’s policy shift, much like January’s selloff came a month after the Fed’s taper announcement in December. Either way, a number of EMFX bellwhethers including the BRL, MXN and TRY appreciated by 0.9%, 0.2% and 0.5% respectively against the USD yesterday. Rates markets were generally about 5- 10bp weaker across the board while EM sovereign credits were also wider. In Turkey, Prime Minister Erdogan surprised many by vowing to block access to Twitter immediately for national security reasons.

Despite some negative headlines yesterday, Russian equities powered into the close to finish at +0.11% but Russian credit underperformed (5yr CDS +8bp) after S&P changed the country’s BBB rating outlook to negative from stable on geopolitical concerns. Fitch also changed its Russian rating outlook to negative overnight. In terms of the politics, both the EU and US yesterday announced expanded sanctions against Russian individuals. Reacting to the US actions, Russia’s Foreign Ministry published a reciprocal sanctions list of US citizens including a number of leaders of Congress. The EU also cancelled the upcoming EU-Russia summit, along with other bilateral summits. Merkel added that the EU was ready to start stage three sanctions against Russia if there is further escalation in the Ukraine. This came after Russia’s Foreign Minister Lavrov claimed that he was concerned over “numerous violations” of the rights of ethnic Russians in eastern Ukraine and the Ukrainian government said that it was preparing to defend the east using military means.

Turning to the day ahead, there’s not a lot on the data docket but the focus will be on speeches from four Fed officials which are the first speakers from the Fed since Wednesday’s FOMC. Perhaps we’ll get a clarification or elaboration of the Fed’s message from Wednesday. Bullard speaks on a Brookings Panel on the topic of nominal GDP. Fisher discusses the pros and cons of forward guidance. Kocherlakota and Stein will be speaking in Washington on monetary policy.


    



via Zero Hedge http://ift.tt/1h0DI6G Tyler Durden