Tag: news

Petro Poroshenko’s 14-point peace-plan is not going well (before it’s even unleashed). First, Russia blasted back that they were “surprised” by comments on their support and that “this does not represent reality,” and is more an ultimatum than a peace-plan:

• *RUSSIA SAYS UKRAINE CEASE-FIRE ISN’T OFFER OF PEACE: IFX
• *RUSSIA SAYS UKRAINE CEASE-FIRE LACKS KEY TALKS OFFER: IFX
• *POROSHENKO GIVING ULTIMATUM TO REBELS TO DISARM: IFX

Then things escalated further as Interfax reports, the ‘severe injury’ of a Russian border guard and ITAR-TASS reports “Moscow awaits explanations from the authorities in Kiev for the shelling of the Russian territory, which took place on the background of President Petro Proroshenko’s claims about a ceasefire.”

 

Poroshenko explained: “This is done for terrorists to be able to lay down arms, and those who fail to do so will be eliminated.”

He said during the ceasefire, “combat operations will only be carried out for retaliation.”

But Russia is not amused…

Moscow is surprised at the Ukrainian Foreign Ministry’s comment on the phone conversation of the heads of the Russian and Ukrainian foreign policy departments, the Russian Foreign Ministry said Friday.

 

“We were surprised to familiarize ourselves with the comment on this conversation made by the Ukrainian Foreign Ministry that says that the ministers support the Ukrainian president’s plan “with emphasis on effective control of the Ukrainian border. This does not correspond to reality,” the ministry said.

And as ITAR-TASS reports, the cease fire is not going well…

Moscow awaits explanations from the authorities in Kiev for the shelling of the Russian territory, which took place on the background of President Petro Proroshenko’s claims about a ceasefire, a spokesman for the Kremlin said Friday.

 

Customs officer severely wounded in incident at Novoshakhtinsk today, Russian Foreign Ministry says on website.

 

Russia condemns “aggressive act,” demands investigation

Who could have known that a peace plan that offered nothing to Russia would not work?

Russia demands an apology… (via reuters)

Russia said a ceasefire announced by Ukrainian President Petro Poroshenko on Friday was not a peace offer but an ultimatum to pro-Russian separatists, Russian news agencies cited the Kremlin press service as saying.

 

“This is not an invitation to peace and negotiations but an ultimatum to militias in the southeast of Ukraine to lay down their arms,” the Kremlin was quoted as saying in a statement.

 

It also said a Russian checkpoint on the border with Ukraine had come under fire and demanded “an explanation and an apology” from Kiev.

So to summarize:

1) Russia does not agree with Peace plan terms

2) Russia sees it as an ultimatum (threat)

3) The cease-fire has allegedly already been broken

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

Forget the 700-plus-page Piketty 'socialism for all' tome; here is economics that everyone can understand.

Click image for link to website

And here they are… the 5 things they don't tell you about economics…

1. 95% of economics is common sense

You don’t need a degree to understand it

 

We’ve got this profession wrong; a lot of professional economists think what they do is too difficult for ordinary people. You’d be surprised how often these people are stupid enough to say things, at least in private, like ‘you wouldn’t understand what I do even if I explained it to you’. If you cannot explain it to other people, you have the problem.

 

People express strong opinions on all sorts of things despite not having the appropriate expertise: climate change, gay marriage, the Iraq War, nuclear power stations. But when it comes to economic issues, many people are not even interested, not to speak of not having a strong opinion about them. When was the last time you had a debate on the future of the Euro, inequality in China or the American manufacturing industry, despite the fact that these issues can have a huge impact on your life, wherever you live?

 

2. Economics is not a science

Despite what the experts want you to believe, there is more than one way of ‘doing’ economics

 

People have been led to believe that, like physics or chemistry, economics is a ‘science’, in which there is only one correct answer to everything; thus non-experts should simply accept the ‘professional consensus’ and stop thinking about it.

 

Contrary to what most economists would have you believe, there isn’t just one kind of economics – Neoclassical economics. In fact there are no less than nine different kinds, or schools, as they are often known. And none of these schools can claim superiority over others and still less monopoly over truth.

 

I accept that being suddenly asked to taste nine different flavours of ice cream when you had thought that there was only one plain vanilla can be quite overwhelming. In order to help, I attach here a simple table that will help you overcome your initial fear.

 

3. Economics is politics

Economic arguments are often justification for what politicians want to do anyway

 

Economics is a political argument. It is not – and can never be – a science.

 

Behind every economic policy and corporate action that affect our lives – the minimum wage, outsourcing, social security, food safety, pensions and whatnot – lies some economic theory that either has inspired those actions or, more frequently, is providing justification of what those in power want to do anyway.

 

Only when we know that there are different economic theories will we be able to tell those in power that they are wrong to tell us that ‘there is no alternative’ (TINA), as Margaret Thatcher once infamously put it in defence of her controversial policies.

 

4. Never trust an economist

It is one thing not to foresee the financial crisis; it’s another not to have changed anything since

 

Most economists were caught completely by surprise by the 2008 global financial crisis. Not only that, they have not been able to come up with decent solutions to the ongoing aftermaths of that crisis.

 

Given all this, economics seems to suffer from a serious case of megalomania.

 

The financial crisis has been a brutal reminder that we cannot leave our economy to professional economists and other ‘technocrats’. We should all get involved in its management – as active economic citizens.

 

5. We have to reclaim economics for the people

It’s too important to be left to the experts alone

 

You should be willing to challenge professional economists (and, yes, that includes me). They do not have a monopoly over the truth, even when it comes to economic matters.

 

Like many other things in life – learning to ride a bicycle, learning a new language, or learning to use your new tablet computer – being an active economic citizen gets easier over time, once you overcome the initial difficulties and keep practicing it.

 

Unless you are willing and able to challenge the professionals, challenge the experts, what’s the point of having a democracy?

 

There is no excuse for complacency. If you organize and demand reforms then a lot of amazing things happen, but it won’t come easy – we have to fight for it.

And there it is – all you need to know when watching the talking head bloviation and justification day after day…

Source: Penguin Group (buy here)

via Zero Hedge http://ift.tt/UhJiO6 Tyler Durden

Janet Yellen just cemented her status as the third member of the unholy triumvirate of Fed Presidents: Greenspan, Bernanke, and now Yellen.

 

Greenspan was so afraid of deflation that he hired Bernanke (an alleged deflation expert) in the early 2000s. Between the two of them, they created bubbles in virtually every asset class on the planet.

 

Deflation did hit for a total 12-14 months (late 2007-early 2009). It was enough to terrify Bernanke to the point that he spent well over $3 trillion (an amount larger than all but a handful of countries’ GDPs), cut interest rates to zero (punishing savers) and generally destroyed the US economy… all in the quest of propping up a few crony capitalist banks that were sitting on several hundred trillion dollars’ worth of derivatives trades.

 

Yellen took over the Fed in early 2014 and has since proven herself to be just as misguided or dishonest as Bernanke was.  Among other things…

 

·      She claims there are no signs of stocks being overvalued, despite the fact that by virtually every metric in existence the market is SEVERELY overvalued.

 

·      She first claimed inflation was too low, and now claims that rising prices are just “noise” while meat prices hit record highs, gas prices hit their highest levels since 2008, home prices are as unaffordable as they were in 2005-2006, healthcare costs are up double digits and energy prices are rising.

 

It’s an astounding series of comments, coming from the woman in charge of US monetary policy. What’s even more astounding is that it appears Yellen actually believes this stuff, which indicates that she either A) doesn’t read the news or look at price charts for items or B) has no idea how to interpret data or C) is a liar.

 

This is the same story we had with Bernanke and Greenspan, both of whom oversaw epic meltdowns in the financial system. Yellen will be no different.

 

This concludes this article. If you’re looking for the means of protecting your portfolio from the coming collapse, you can pick up a FREE investment report titled Protect Your Portfolio at http://ift.tt/170oFLH.

 

This report outlines a number of strategies you can implement to prepare yourself and your loved ones from the coming market carnage.

 

Best Regards

 

Phoenix Capital Research

 

 

 

 

 

via Zero Hedge http://ift.tt/UnZXzJ Phoenix Capital Research

Submitted by Derrick Wulf of No Easy Trade blog,

One of the highlights of an otherwise uneventful press conference by Fed Chairman Janet Yellen earlier this week was her carefree dismissal of recent inflation gains as mere “noise.” This was significant for two reasons: first, it implied a level of forecasting confidence that seems wholly inconsistent with the “data-dependent” policy approach we have been told to expect from the Fed, and second, it was an entirely inaccurate characterization of the data. Much of the recent increase in CPI has in fact come from traditionally stable categories such as services, which have posted annualized three and six month gains of more than 3% for several months now, while weakness has actually come from the more volatile components such as “commodities less food”. The official BLS release for May even characterized the price increases as “broad based,” all of which strongly suggests there’s something more than mere noise behind these figures.

It’s important to remember that the FOMC has tactically embraced “forward guidance” as a monetary policy tool, and committee members know that in order for it to be effective they must speak with confidence and conviction. Most recently, their confidence has helped to reduce volatility and compress risk premia in a number of asset classes, but it also comes at the risk of damaging their credibility in the longer term. Moreover, history has shown time and again that the financial markets have an uncanny ability to seek out complacency and test the conviction of both investors and policymakers alike. Why should this time be any different?

On the day after Chairman Yellen’s press conference, investors aggressively bid up inflation trades across numerous asset classes. Gold and silver rallied sharply, TIPS implied inflation breakevens widened (despite a new slug of 30-year supply), Treasury yields rose, and the yield curve steepened. Based on investor positioning and market sentiment, I think there’s decent potential for additional gains in these inflation expressions in the days and weeks ahead.

In rates, for example, investors have accumulated significant short positions in the front end of the curve against longs in the 30-year sector, indicating potential for a meaningful curve steepening when these trades are unwound. Positioning surveys consistently show that “real money” investors are overwhelmingly short their duration benchmarks, while the CFTC’s Commitment of Traders data show record net short positions exceeding $1.5 trillion in notional rates exposure among speculators in the eurodollar futures markets.

Within the macro community, meanwhile, a number of large investors inspired by none other than Ben Bernanke in his paid private dinner musings maintain significant long-end rates exposure on the belief in a lower terminal fed funds rate. Frequent reassurances by various fed officials that inflation risks remain subdued has emboldened their view that 30-year yields can fall lower still.

But any time the Fed gets behind the curve on inflation, the yield curve steepens, and the post-FOMC price action yesterday warns that this may in fact soon be the case. Moreover, the charts show potential for a technical break in the 5s / 30s curve that may encourage additional unwinds of crowded curve-flattening trades.

 

A glance at the 30yr yield chart also indicates potential for additional long-end weakness, with the recent bull-trend already broken and a potential reversal now underway.

A break above 3.50% would confirm the reversal and likely seek 3.75% next. If the inflation trade has legs, however, it may not be long before 4% is revisited.

Key to this trade will be incoming data on wages, incomes, and consumer confidence, as well as investor sentiment regarding fed credibility on the outlook for inflation. Considering the recent rhetoric in the context of current market positioning, I perceive some vulnerability on this front, which may well lead to more than just a bit of noise on the charts.

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

Two days ago, before it was formalized that the US tacitly, if not explicitly, now supports the removal of the Iraqi Prime Minister whom it itself had helped elect, we summarized the geopolitical tensions and “national interests” in Iraq, which is shaping up to be a proxy war that makes last year’s Syrian escapade pale by comparison, as follows:

The situation in Iraq, already a jumble of domestic sectarian violence, is now pitting virtually all major (and regional) international players against each other as well. There is:

• US which tacitly supports Iran intervention in the region, but may have suddenly cooled in its support of Maliki despite sending naval and troop forces in the country after partially evacuating its embassy
• Saudi Arabia which wants to remain friendly with the US but is antagonistic to the Iraq regime, is potentially aiding the ISIS forces, and clearly refuses to allow Iran entrance in Iraq
• Iran, which has suddenly become America’s best friend in the region, which is willing to enter Iraq and protect its holy sites
• Syria, whose president is sitting back amused at last year’s failed campaign by the US to remove him from power, and whose army is at a stalemate with the local US-armed and funded rebels
• Qatar, which is supporting the Syrian rebels, but so far has not made its stance clear on Iraq. Like Saudi, it too may be indirectly backing ISIS
• Jordan, which is a close friend the US, and which may have hosted ISIS in a secret base on its territory with the US instructing the jihadist group according to an unconfirmed report
• Turkey, which is on constant alert to Kurdish escalation across the border, the same Kurds which now have far more leverage courtesy of ISIS crushing the Iraq army in the north and handing over Kurds access to oil fields in the north.
• And of course Russia: because while Putin clearly benefits from rising crude prices, it is his Lukoil that is developing (and investing vast amounts of money in) the vast Iraqi West Qurna-2 oil field. It is not clear how he would feel about it falling into ISIS hands.

It was the bolded text that was of biggest interest because as we noted the next day, when discussing the next steps for ISIS, we said that “One wonders how long until the mercenary force finds its latest major backer, because for all the western, US-led intervention, both Russia and China are oddly missing from the scene. We expect that to change soon.“

Because clearly one can’t have a global proxy war without China, and certainly without Russia.

Well, we said we expected Russia’s conspicuous absence to “change soon”, and so it did: within just 24 hours. Because apparently all Putin was waiting for was for Obama to pick sides (i.e., not Maliki) before the Russian leader made it clear whom he sides with. US, helpfully obliged yesterday morning when we also reported that “US Slams Its Former Iraq Puppet: “The Maliki Government, Candidly, Has Got To Go“.”

So what does Putin do? Why announce his undying support for Maliki, of course, and as AP reported, the former KGB spy offered Iraqi premier Nuri al-Maliki Russia’s total backing for the fight against fighters who have swept across the country.

Russian President Vladimir Putin has spoken by phone to Iraqi Prime Minister Nouri al-Maliki, expressing Moscow’s support for his action against the militant offensive.

 

The Kremlin said in a statement that al-Maliki informed Putin on Friday about his government’s steps to combat the “terrorist groups in the north of the country.” It added that the insurgency threatens security of the entire region.

 

Putin confirmed Russia’s “full support for the Iraqi government’s action to quickly free the territory of the republic from terrorists,” the Kremlin said, adding that Putin and al-Maliki also discussed bilateral cooperation.

 

Putin’s expression of support for the embattled Iraqi prime minister comes as al-Maliki’s rivals have mounted a campaign to force him out of office, with some angling for support from Western backers and regional heavyweights.

And just like in Syria from 2012 to 2013, the chessboard is once again set, with a regional middle-east conflict, this time in Iraq, merely serving as the proxy staging ground in which the Iraqi PM, once an obedient US puppet but now an enemy of Saudi Arabia and thus the US, “simply has to go” in the words of Dianne Feinstein, has suddenly become the fulcrum issue behind yet another soon to escalate conflict between Russia and the US.

One thing is certain: the more the US (and Saudi Arabia, and Qatar) pushes for Maliki’s ouster, the more involved Russia will become with its offers of support and bilateral cooperation. And if the Syrian fiasco (for John Kerry) is any indication, Russia is about to expand its “national interest” sphere of influence by one more country.

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

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via Zero Hedge http://ift.tt/1noIPAA williambanzai7

With 23 games behind us in the FIFA World Cup in Brazil, we stop to reflect on the success (or failure) of forecasts so far. As we showed here, Brazil began the tournament as more than 3 times more likely winners than any other team, and, according to Goldman's new estimations, remains the strong favorite with a 49.5% chance of raising the Jules Rimet trophy. England's disappointment leaves them a 3% chance of getting to the knockout phase (and USA a 0.7% chance of winning it all). Goldman, however, have severely over-estimated Brazil and Spain's performances (and under-estimated Holland and Spain) as their track-record so far is Stolper-esque at 34% win rate (8 right, 15 wrong).

 

 

Initial predictions…

 

The results (red) and new predictions..

 

For the knockout phase…

 

and odds of progressing…

 

Source: Golkdman Sachs

via Zero Hedge http://ift.tt/1igp4PJ Tyler Durden