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

Dec 16, 2014 - 12:23pm

Crude headed right back into

Crude headed right back into the toilet.

And though equities rallied as if some kind of relief was happening, it was never confirmed by the bond market. Still UP on the day with the 10-year at 2.08 and the LB at 2.71

Marchas45
Dec 16, 2014 - 12:24pm

Awesome Site Murphy

Really Enjoy It. Keep Stacking

Dec 16, 2014 - 12:27pm

Long Bond chart

Stopped earlier within two ticks of the Oct 15 high. We break 148 and it's goodnight Irene...

flyinkel
Dec 16, 2014 - 12:28pm

Scott

AM also rolls astrological into his charting at times. His thread is "The Set-up for the big trade". Suspect he looks at and interprets the astrological aspect far more often than he actually posts about it.

kardnul
Dec 16, 2014 - 12:28pm

RE: Russian Central Bank suppressing Russian economy

Great video, interesting take on the Russian Central Bank working against the Russian economy, while subverting Putin. Now it is much more clear why the Ruble is in trouble and what options Putin has.

Putin will have to take control and do something like nationalize the RCB to try and stop the west's attempt at regime change, like they did to Kiev, and do it soon. Of course that can not be tolerated by the western banking cartel.....hence war.

All wars are banker wars

Dec 16, 2014 - 12:32pm

worser and worser and worser and worser

God help us all: https://www.zerohedge.com/news/2014-12-16/obama-sign-lethal-us-aid-ukrai...

With apologies to ZH, here's a C&P of the entire ZH post. This is way too important to take the chance that not everyone reads it.

As we reported over the weekend, in the tumult surrounding Citigroup's annexation of Congress with the passage of the theatrically dramatic $303 trillion derivative quid-pro-$1.1 trillion spending quo, what most missed is that Congress also unanimously passed the The Ukraine Freedom Support Act of 2014, which not only expands Russian sanctions (read the details here) but far more impotantly, provides "lethal assistance to Ukraine’s military." And as we explained, passage of this law is just the pretext some Russian legislators needed to push for a full-blown, preemptive military incursion in east-Ukraine.

Recall:

“The decision of the US Senate is extremely dangerous. If it is supported by the House of Representatives and signed by their president, Russia must reply with adequate measures,” Mikhail Yemelyanov of the Fair Russia party told reporters on Friday.

"It is quite possible that we should return to the decision by our Upper House and give the Russian president an opportunity to use military force on Ukrainian territory preemptively. We should not wait until Ukraine is armed and becomes really dangerous,” the lawmaker stated.

Yemelyanov also noted that in his opinion the US Senate’s decision to arm Ukraine had revealed that Washington wasn’t interested in the de-escalation of the Ukrainian conflict. He then said that US actions gave him the impression they was seeking to turn Ukraine into some sort of an “international militant targeting the Russian Federation.”

“In a few years Ukraine will turn into a poor and hungry country with an anti-Russian government that will teach its population to hate Russia. They will be armed to the teeth and Ukraine and US reluctance to recognize the Russian Federation within its current borders would always provoke conflicts,” the MP said.

Furthermore, we asked if "this means that what was a lingering proxy cold civil war in east Ukraine between NATO-armed Ukraine troops and Russia-armed Separatists and local militias is about to escalate into a shooting precursor to something greater? There is still hope an all out escalation can be avoided" and we cited White House press secretary Joshn Earnest who last week said that "the administration hadn’t finished reviewing the language and isn’t ready to take a position on the legislation. He said the administration wants to ensure that the U.S. and its European allies are working together, that any sanctions are effective and that they minimize harm to U.S. and European companies. “This is delicate work,” Earnest said."

Apparently, not delicate enough, and moments ago we got confirmation that the epic collapse in the USDRUB is just a jovial preview of the main event. To wit:

  • OBAMA DOES INTEND TO SIGN RUSSIAN SANCTIONS LEGISLATION:EARNEST
  • OBAMA LIKELY TO SIGN SANCTIONS BILL BEFORE END OF WEEK: EARNEST

And with that, US "lethal aid" will shortly begin arriving in Kiev, which in turn will be just the pretext needed by Sergey Lavrov and the Kremlin to escalate the recent events in Russia as a direct attack by the West, and to demand retaliation against a US president who "does not reason" as the Russian media will appeal to the population in an attempt to "rally round the flag", and as a result Russian tanks may have no choice but to enter the separatist territories in East Ukraine.

What the western, and certainly NATO, response at that point will be, is far beyond our meager prediction skills.

Barfly
Dec 16, 2014 - 12:32pm

Word of the day is deflation.

Word of the day is deflation. Thank you fed. Edit: I think the bond bubble will get even bubble-ier when the stock markets tank. All the lemmings will be "running to safety."

nut cutter
Dec 16, 2014 - 12:35pm
Dec 16, 2014 - 12:44pm

My intention is not to alarm

And I hope I don't sound panic-stricken. However, this is really, really bad and I am getting very, very concerned.

Please read this. This is the bill that both houses of the American Congress passed over the wekend and Woody is about to sign into "law". Pay particular attention to this:

  • Amends the Foreign Assistance Act of 1961 to designate Ukraine, Georgia, and Moldova as major non-NATO allies for purposes of that Act and the Arms Export Control Act.
  • Provides assistance to Ukraine for: (1) the military, defense, energy, and civilian sectors; and (2) internally displaced persons.

Summary: S.2828 — 113th Congress (2013-2014)All Bill Information (Except Text)

There is one summary for this bill. Bill summaries are authored by CRS.
Shown Here:
Introduced in Senate (09/16/2014)

Ukraine Freedom Support Act of 2014 - Directs the President to impose three or more sanctions under this Act against:

Rosoboronexport;
any person that knowingly makes a significant investment in a special Russian crude oil project; or
any entity owned by the government of the Russian Federation or controlled by its nationals that transfers or brokers the transfer to, or manufactures or sells defense articles transferred to, Syria or into the territory of a specified country without its government's consent.
Defines "specified country" as Ukraine, Georgia, Moldova, or any other country of significant concern for purposes of this Act, such as Poland, Lithuania, Latvia, Estonia, and the Central Asia republics.

Authorizes the President, through the Bureau of Industry and Security of the Department of Commerce or the Office of Foreign Assets Control of the Department of the Treasury, to impose additional licensing requirements or other restrictions on the export of items for Russia's energy sector.

Directs the President to impose sanctions under this Act on Gazprom if it is withholding significant natural gas supplies from North Atlantic Treaty Organization (NATO) member countries, or further withholds significant natural gas supplies from countries such as Ukraine, Georgia, or Moldova.

Sets forth sanctions against a foreign person, including executive officers of an entity, relating to:

  • Export-Import Bank of the United States assistance,
  • executive agency procurement,
  • arms and dual-use item exports,
  • U.S. property transactions,
  • banking transactions,
  • investing in or purchasing equity or debt instruments, and
  • U.S. entry prohibition or visa revocation.

Authorizes the President to waive the application of sanctions, or waive sanctions for a specific transaction, for purposes of U.S. national security, and with congressional notification.

Amends the Foreign Assistance Act of 1961 to designate Ukraine, Georgia, and Moldova as major non-NATO allies for purposes of that Act and the Arms Export Control Act.

Provides assistance to Ukraine for: (1) the military, defense, energy, and civilian sectors; and (2) internally displaced persons.

Directs the Secretary of State to work with Ukrainian officials to help Ukraine reduce its dependence on natural gas imported from the Russian Federation.

Directs the Chairman of the Broadcasting Board of Governors to submit to Congress a plan for increasing the quantity of Russian-language broadcasting into the countries of the former Soviet Union in order to counter Russian Federation propaganda. Requires such plan to prioritize broadcasting into Ukraine, Georgia, and Moldova by the Voice of America (VOA) and Radio Free Europe/Radio Liberty.

IF YOU'RE PUTIN, HOW DO YOU SEE THIS...ALL OF IT, FROM COLLAPSING CRUDE AND THE RUBLE TO THIS NEW ACT...AND NOT CONSIDER IT AN ACT OF WAR?

SS121
Dec 16, 2014 - 12:46pm

December 16th Congratulations!!

to all those who cashed out of the system and TODAY received their cash-in-hand... CONGRATULATIONS!

physical Silver is currently/still available from local and online dealers at system fake-chart prices. the soon-to-be-ending opportunity of a lifetime

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