Turdville Open Thread

233
Tue, Dec 16, 2014 - 10:32am

As historic events unfold around us, and with markets moving so quickly around the globe, I thought we should try something different today. Hopefully this open thread provides a forum for the free exchange of ideas and opinions as well as headline updates for all the global markets.

My opinion is this:

With overt sanctions against Russia having minimal impact, the U.S. set out on a course of covert sanctions last summer. Among these was a plan to manipulate down the paper price of crude oil as Russia derives nearly 15% of its national income from the sale of crude.

Once price broke $90, the spec algos took over and the growing momentum of the trade has driven price well beyond what the central planners originally thought possible. Now closing in on $50, the decline has imperiled all sorts of economies, currencies and derivatives around the globe.

Chief among those imperiled is the original target, Putin's Russia, which has seen the ruble devalue by nearly 50% in past few months, 20% in just the past few days. The US and NATO are already fighting a proxy war versus Russia in Ukraine. How might these events intensify the battles there?

And there are all sorts of other "unknown unknowns" here:

  • The $4T in US TBTF bank commodity derivatives, the majority of which are linked to crude oil.
  • The collapsing currencies and equity markets of other crude oil producing nations.
  • The US high yield bond market with an abundance of debt issued by energy companies.
  • Might even Russia surprise the world by "thinking outside the box", if you get my drift?

So, anyway, please discuss all of this here and be sure to add your own ideas and theories. I'm going to make this a public thread so that anyone stopping by will have the opportunity to explore the collective wisdom of Turdville.

As I close, the US stock market is now UP on the day (big surprise), while the 10-year note and the Long Bond are making new yield lows for 2014. Crude is down but $1.50 off its lows at $55.50 and, of course, gold and silver are DOWN. Again, no surprise there. Silver's actually down 4% and below $16. Funny...I guess I failed to notice how the global fundamental picture for silver has deteriorated by 10% since just last Friday.. Wow, how could I have missed that?

TF

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turd [at] tfmetalsreport [dot] com ()

  233 Comments

ReachWest
Dec 16, 2014 - 10:46am

Exactly, RW

THIS is what is so intriguing/concerning.

Putin must know that this is all being done deliberately against him. How will he respond? We must figure that ALL options are on the table.

jwmkratz
Dec 16, 2014 - 10:48am

Russia Has $500B In US Treasuries

And their in the middle of an economic war where casualties will high across the board. Enough said

Orange
Dec 16, 2014 - 10:49am

Bubbles

Harry Dent: “These falling oil prices trigger these fracking firms. They have 20% of the junk bond high-yield debt in the United States, and that’s all it takes to trigger another financial crisis…”

https://investmentwatchblog.com/harry-dent-these-falling-oil-prices-trigger-these-fracking-firms-they-have-20-of-the-junk-bond-high-yield-debt-in-the-united-states-and-thats-all-it-takes-to-trigger-another-financial-c/#1hAQgOv4CakRRvdG.99

Edit. Dent says he thinks gold to go to $250 to $400. I call that flat bullshit

Dec 16, 2014 - 10:49am

And don't forget

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Dobocop
Dec 16, 2014 - 10:50am

Gold backed ruble

A Gold backed Ruble is how i hope Putin responds.

jwmkratz
Dec 16, 2014 - 10:51am

Again, exactly

All bets are off. The US has created an existential threat against Putin and Russia. How he responds is totally unpredictable at this point. This IS the currency war that so many have written about.

ScottJ
Dec 16, 2014 - 10:52am

With Every Ending Comes a New Beginning

Hello Friends,

Long time no chat. I'm going to take the contrarian viewpoint and say that everything is going to be alright, and that we are moving into a new age of harmonious peace around the world. The end of the old Keynesian experiment may be upon us, but the new Keynesian experiment will be one which we can all participate within worldwide.

It's quantum physics!

Scott J

Dobocop
Dec 16, 2014 - 10:53am

Maybe

Maybe an immediate exit from SWIFT and replacement with their own system. Maybe start accepting only gold for crude.

At this point, anything is possible.

ScottJ
Dec 16, 2014 - 10:54am

Hello, Scott

It's always nice to hear from an old friend. I hope you are well.

ScottJ
Dec 16, 2014 - 10:54am

P.S. - Does anyone ever use

P.S. - Does anyone ever use the live chat room?

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