Archive for 2014

Guest Post: The U.S. Airstrikes In Northern Iraq Are All About Oil

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by John B Judis via The New Republic,

This week, President Barack Obama announced that he was authorizing American airstrikes in Iraq. He described his intervention as a “humanitarian effort to help save thousands of Iraqi civilians who are trapped on a mountain” and as an effort “to protect our American personnel.” One word that he didn’t mention is “oil,” but it lies near the center of American motives for intervention.

The United States is conducting airdrops to aid the Yazidis who have fled the advance of Islamic State militants, but it is conducting airstrikes around Erbil, which is to the east. There are American consular personnel in Erbil, but they could be evacuated if necessary. What Obama left unsaid was that Erbil, a city of 1.5 million, is the capital of the Kurdish regional government and the administrative center of its oil industry, which accounts for about a quarter of Iraq’s oil. The Kurds claim that if they were to become an independent state, they would have the ninth-largest oil reserves in the world. And oil wells are near Erbil.

If the Islamic State were to take over Erbil, they would endanger Iraq’s oil production and, by extension, global access to oil. Prices would surge at a time when Europe, which buys oil from Iraq, has still not escaped the global recession. Oil prices have already risen in response to the Islamic State’s threat to Erbil, and on Thursday, American oil companies Chevron and Exxon Mobile began evacuating their personnel from Kurdistan. But oil traders are predicting that American intervention could halt the rise. “In essence we find U.S. air strikes more bearish than bullish for oil as the act finally draws a line for IS and reinforces both the stability in south Iraq and in Kurdistan,” Oliver Jakob, a Swiss oil analyst, told Reuters.

In portraying American intervention in Iraq as a purely humanitarian effort, Obama is following the script he read from in Libya, when he justified American intervention as an effort to prevent a massacre in Benghazi. In a March 28, 2011 address to the nation, Obama painted the American intervention as a response to “brutal repression and a looming humanitarian crisis.” Oil was not mentioned, even though Libya was the world’s sixteenth-largest
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The Wonders Of The Modern World: China’s Amazing Tower Of Garbage

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

When it comes to ancient wonders of the world, there is the tower of Babel, and to a lesser extent, the leaning tower of Pisa. Sadly, modern wonders leave something to be desired: case in point, this 30 metres high garbage mountain at the crossroad of Huanghe avenue and Zhufeng street of Shijiazhuang, central China’s Hebei province. The garbage mountain has been piled up as high as a 9-story Building in the last 30 years. The local village committee now is dealing with these wastes: best of luck. And to think all it took were several trillion in non-performing loans…

Source: CRI





What Countries Are Currently At War? The Complete List

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

A month ago we explained that 11.7% of the world’s population was at war and mapped out the key global geopolitical hotspots. However, while Israel, Palestine, Ukraine, and Iraq monopolize the headlines nowadays, they are not the only groups currently at war. Serious armed conflicts are happening all over the world – we just don’t hear about them. Here’s our complete list of the wars happening right now…

 





AN IMPoRTaNT MeSSaGe FRoM BaGDaD BRo..

Courtesy of ZeroHedge. View original post here.

Submitted by williambanzai7.

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Hussman On “The Greatest Risk That Investors Face Here”

Courtesy of John Hussman

[Via Zero Hedge]

Excerpt from the Weekly Market Comment

My impression is that today’s near-absence of risk premiums is both unintentional and poorly appreciated. That is, investors have pushed up prices, but they still expect future returns on risky assets to be positive. Indeed, because all of this yield seeking has driven a persistent uptrend in speculative assets in recent years, investors seem to believe that “QE just makes prices go up” in a way that ensures a permanent future of diagonally escalating prices. Meanwhile, though QE has fostered an enormous speculative misallocation of capital, a recent Fed survey finds that the majority of Americans feel no better off compared with 5 years ago.

We increasingly see carry being confused with expected return. Carry is the difference between the annual yield of a security and money market interest rates. For example, Wall Street acts as if a 2% dividend yield on equities, or a 5% junk bond yield is enough to make these securities appropriate even for investors with short horizons, not factoring in any compensation for risk or likely capital losses. This is the same thinking that contributed to the housing bubble and subsequent collapse. Banks, hedge funds, and other financial players borrowed massively to accumulate subprime mortgage-backed securities, attempting to “leverage the spread” between the higher yielding and increasingly risky mortgage debt and the lower yield that they paid to depositors and other funding sources.

We shudder at how much risk is being delivered – knowingly or not – to investors who plan to retire even a year from now. Barron’s published an article on target-term funds last month with this gem (italics mine): “JPMorgan's 2015 target-term fund has a 42% equity allocation, below that of its peers. Its fund holds emerging-market equity and debt, junk bonds, and commodities.”

…it's helpful to be aware of how compressed risk premiums unwind. They rarely do so in one fell swoop, but they also rarely do so gradually and diagonally. Compressed risk premiums normalize in spikes.

…when risk premiums are historically compressed and showing early signs of normalizing even moderately, a great deal of downside damage is likely to follow. Some of it will be on virtually no news at all, because that normalization is baked in the cake, and…
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Military Coup In Iraq: Prime Minister Maliki Refuses To Step Down; Security Forces On Alert, Encircle Presidential Palace

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Just days after the US launched a campaign that implicitly aides the current regime headed by the supposedly outgoing PM, al-Maliki, it appears that latest US intervention has already led to “unexpected” consequences, this time with the prime minister appearing to have just staged a coup overthrowing Iraq’s president President Fouad Massoum moments ago.

Reuters reports that the prime minister “indicated that he will not drop his bid for a third term and accused the president of violating the constitution in a tough televised speech likely to deepen political tensions as a Sunni insurgency rages. Maliki, seen as an authoritarian and sectarian leader, has defied calls by Sunnis, Kurds, some fellow Shi’ites and regional power broker Iran to step aside for a less polarising figure who can unite Iraqis against Islamic State militants.

The days of Iraq’s president appear numbered:

Bloomberg adds that Maliki says he’s going to federal court to sue President Fouad Masoum for violating the constitution, according to comments made to Iraqi state television. President Masoum in breach when he extended constitutional period for chosing a candidiate to form government and for missing deadline for new period, according to Maliki. Maliki adds that Masoum is in a “coup against the poilitical process” that would lead “Iraq into a dark tunnel.” Maliki warned Presidential council, parliament and federal court about Masoum.

The news has promptly led the WaPo Beirut chief correspondent Liz Sly to ask the question: did Baghdad just have a coup 3 days after the US conducted its fourth military intervention under as many US presidents?

Others are inclined to agree:


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Ukraine Fighting Rages On As Russia Calls For Another Ceasefire: Ukraine Demands Total Surrender

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

With Ukraine shelling having killed 52 civilians in the city of Horlikva (Donetsk region) over the last two weeks alone, Russia is growing increasingly vocal of the need for a humanitarian cease-fire (notably with Germany also “concerned about the humanitarian situation” in Ukraine). However, as AP reports, fighting raged once again today as Ukrainian forces killed 1 and injured 10 in Donetsk, ignoring calls for a cease-fire. Andriy Lysenko, a spokesman for Ukraine’s National Security and Defense Council, said the only way for the rebels in Donetsk to save their lives would be to “lay down their arms and give up.” Meanwhile, just as we warned, the mainstream media is starting to pick up on the ‘other’ border dispute that Russia is involved in as Putin mediates talks between Armenia and Azerbaijan.

 

*UKRAINE SHELLING KILLS 52 CIVILIANS IN HORLIVKA OVER 2 WKS: RIA

Death toll include 9 children in city in Donetsk region, state-run Russian news service RIA Novosti reports, citing Horlivka’s health department.

 

71 people hospitalized between July 27 and Aug. 10, according to RIA

As Russian concerns about the humanitarian crisis grow…

Russia is in talks with Ukraine, UN humanitarian organizations and the International Committee of the Red Cross on urgent relief supplies to the Luhansk and Donetsk regions, said Russian Foreign Minister Sergei Lavrov.

 

“We have given priority in our talks with Ukraine, with the International Committee for the Red Cross and with UN humanitarian organizations to the necessity to dispatch relief aid to the Luhansk and Donetsk regions without delay,” Lavrov told reporters in Sochi on Sunday.

 

There is neither power, nor water in Luhansk, where hospitals have no essential medicines at their disposal, Lavrov said.

 

“All this is a sign of the most acute humanitarian situation. I discussed it over the past two days with the Ukrainian foreign minister, the U.S. secretary of state, the British secretary of state for foreign affairs, the leader of the International Committee of the Red Cross and with other colleagues,” the Russian foreign minister said.

 

“This issue is urgent and cannot be delayed, and it is under the Russian president’s control. I am convinced we will manage to reach agreement on relief


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“The Train Wreck Is Coming,” David Stockman Warns, “All Hell Will Break Loose”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by David Stockman via Contra Corner blog,

Transcript of David Stockman Interview on King World News

Eric King:  “David, the man who is counsel to big money around the world, Michael Belkin, just spoke with KWN and issued a dire warning for the financial markets.  I just wondered how you see things at this point with the Dow recently tumbling and everything that is happening across the globe?  What should we expect?”

Stockman“Well, the watchword at this point is stay out of harm’s way.  We are headed into a perfect storm of policy failures.  This is not simply a failure by the Fed, which has inflated this massive bubble and painted itself into a corner with no clue how to get out, but we are also seeing an absolute failure of American world dominance….

Our foreign policy is collapsing everywhere and yet the Washington war party keeps wanting to do more of the same.  This confrontation with Putin is utterly out of hand and unnecessary.  Now we have a trade war going that is going to ricochet through an already fragile European economy.

We hear today that Obama is considering going back into Iraq.  What is he thinking?  If you layer that on top of an already fragile financial bubble that is waiting to burst, I think we are in a zone of extreme danger.  It’s hard to predict whether this will be the big, destructive bear market that inevitably has to come, or simply just another dip that encourages the robots and the trained seals on Wall Street to buy for another move higher.  But one of these times we are going to have a big failure and I don’t think it’s too far down the road.

If you look at the stock market it has gone nearly straight up for the last 64 months.  If you look at the chart of the S&P 500 you can see that year after year the dips get shallower and more infrequent and that is not a healthy chart.  That is a sign of a market that is not discounting the actual real world future, but simply trading the word clouds and the liquidity that is being injected by not only our central bank, but…
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What We Will Likely Learn in the Coming Days


Courtesy of Marc to Market 

The most important economic events of August are behind us.  The ECB meeting and the US employment data are have taken place.   The purchasing managers surveys for July have already been reported.  
 
Much of the data due out in the coming days will  flesh out details of what is generally understood in broad strokes.  This is especially true of Japan and euro zone's first estimates of Q2 GDP.
 
The available data indicates that the euro zone economy enjoys no momentum, and questions have been raised whether the growth is has reported (0.2% in Q1) is sufficient to signal that the recession truly ended. Draghi's formulation of the recovery being weak, fragile and uneven is not inconsistent with this view. 
 
The consensus expects the most meager of growth in Q2 (0.1%) and the risks are on the downside. The Bundesbank warned that the Germany economy may have stalled in Q2, and investors have already been told the Italian economy contracted by 0.2%.  The Italian economy grew in one-quarter (0.1% in Q4 13) since Q3 11, and some clever pundits want to call this a triple dip.  Surely it is more compelling and accurate to recognize that the Italian economy never emerged from the recession that began in Q4 11.  
 
Already reported data points to a steep contraction in Japan's Q2 GDP under the weight of the retail sales tax increase on April 1.  The consensus calls for a contraction of around 7.5% at an annualized pace.  Much of the key economic data, like household consumption and industrial production, were weaker than economists had expected.
 
This warns of potential downside risks to the GDP estimate, as if the consensus has yet to fully appreciate the fullimpact of the sales tax increase.  A consensus report would erase in full the 6.7% expansion in Q1 (annualized pace), and mean that the world's third largest economy contracted in H1.  Both the government and the central bank have cut their economic assessments but are reluctant to indicate the need for new stimulative measures.  
 
With the euro


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They’re Lying To Us, Part 5: Fake Credit Scores

Courtesy of John Rubino.

Like any other weak-willed entity, an over-indebted country eventually finds that formerly-easy things get harder to do. Today, for instance, banks are having trouble attracting customers with the kinds of credit scores that meet previously-set criteria for mortgages and car loans. As a result they’re writing fewer loans and the economy is seeing less debt-fueled growth than policy makers think is ideal for the run-up to the next election.

So the government has begun a mass-education program to teach citizens how to manage credit wisely and limit borrowing to highly productive projects. Just kidding! What the government is actually doing is changing the way credit scores are calculated to raise them to fit bank lending standards.

This of course should not be a surprise, since it has recently become the policy of most US institutions do define standards downward in a pinch. College grade inflation is an obvious example, as is the fact that government inflation, unemployment and GDP statistics are systematically distorted to make bad numbers look better.

In this latest case, credit scores will no longer include the impact of past-due debts that have been settled and will give less weight to debts relating to medical expenses. Take those things out and voila, the average American has a lot better-looking credit, more of them will qualify for mortgages, more homes will be bought, and the economy will be stronger in November 2016.

For a longer, very well-done look at this subject, see Zero Hedge’s As “Housing Recovery” Fizzles A New Scheme Emerges: Boost FICO Scores By Changing The Definition


Visit John’s Dollar Collapse blog here >





 
 
 

Phil's Favorites

Brexit identities: how Leave versus Remain replaced Conservative versus Labour affiliations of British voters

 

Brexit identities: how Leave versus Remain replaced Conservative versus Labour affiliations of British voters

Courtesy of Geoffrey Evans, University of Oxford and Florian Schaffner, University of Oxford

British politics was relatively stable in the post-war decades, and voters’ strong party loyalties were influenced by their place in society. More recently, there has been a marked decline in the number of people identifying with a political party, and in the strength of that attachment.

Now, our new research for a repor...



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Zero Hedge

Stocks Jump On Kudlow Denial: "There Is No Cancellation. None. Zero."

Courtesy of ZeroHedge. View original post here.

"There are no cancellations. None. Zero. Let's put that to rest."

Hours after a headline from the FT about the US cancelling a round of trade talks with two senior Chinese ministers send stocks reeling to their lows of the day, the administration has dispatched Larry Kudlow (who apparently had to wait until 20 mins before the close thanks to CNBC's wall-to-wall Davos coverage) to jawbone the markets back into the green by...



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Kimble Charting Solutions

S&P and Crude both testing key breakout levels!

Courtesy of Chris Kimble.

The correlation between Crude Oil and the S&P 500 has been rather high over the last 100-days, as each looks to have peaked at the same time around the 1st of October at (1).

After peaking together in October, Crude fell over 40% and the S&P nearly declined 20%, with both bottoming on Christmas Eve at each (2).

Both have experienced counter-trend rallies since the lows, as Crude is up 23% and the S&P 13%.

These rallies have both testing dual resist...



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Insider Scoop

Cowen Suits Up With Nike, Looks To Outperform

Courtesy of Benzinga.

Related NKE Consumer Discretionary Q4 Earnings: U.S. Consumer Appears Strong Amid Heightened Global Uncertainty Golf Equipmen...

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Chart School

Weekly Market Recap Jan 20, 2019

Courtesy of Blain.

After entering the week quite overbought, indexes took a small retreat Monday before hurling back upwards.  This is typical of the “V” shaped moves up after any significant selloff, we’ve seen most of the past decade and watching them unfurl is quite amazing actually.  Thought maybe this time would be “different” but not so much.  So two week’s ago we asked “Has the Fed solved all the market’s problem in 1 speech?” – and thus far the market has answered resoundingly yes.  The word of the year thus far in 2019 is “patience” as that simple insert into a speech change the whole complexion of everything.

China has also been busy stimulating; on Tuesday:

An announcement from the People’s Bank of China that ...



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ValueWalk

Everyone Else Is Selling Stocks, So Is It Time To Buy?

By Michelle Jones. Originally published at ValueWalk.

After a difficult few trading days in the beginning of the year, U.S. stocks are bouncing back with meaningful gains on Monday following Friday’s strong rally. The S&P 500, Dow Jones Industrial Average and Nasdaq 100 were all up by more than half a percent by midday. It looks like investors could be taking advantage of the end-of-the-year declines, but is this a wise time to be buying?

Trying to time the bottom of the market will almost always be a fool’s errand, but one firm suggests equities could have much farther to fall before they hit bottom in 2019.

...



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Digital Currencies

Transparency and privacy: Empowering people through blockchain

 

Transparency and privacy: Empowering people through blockchain

Blockchain technologies can empower people by allowing them more control over their user data. Shutterstock

Courtesy of Ajay Kumar Shrestha, University of Saskatchewan

Blockchain has already proven its huge influence on the financial world with its first application in the form of cryptocurrencies such as Bitcoin. It might not be long before its impact is felt everywhere.

Blockchain is a secure chain of digital records that exist on multiple computers simultaneously so no record can be erased or falsified. The...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

Reminder: We are available to chat with Members, comments are found below each post.

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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