Team Macro Man provide a translation of the latest G"whatever" statement on Ukraine. The original is in italics.
We, the leaders of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States and the President of the European Council and President of the European Commission, join together today to condemn the Russian Federation’s clear violation of the sovereignty and territorial integrity of Ukraine, in contravention of Russia’s obligations under the UN Charter and its 1997 basing agreement with Ukraine.
We the G8 (oh we can't say that can we, how about G7? Just stick our names down) have in our hands a piece of paper signed my MisterHitler Putin.." It seemed to work for Mr Chamberlain. Oh it didn't? Are you sure?
We call on Russia to address any ongoing security or human rights concerns that it has with Ukraine through direct negotiations, and/or via international observation or mediation under the auspices of the UN or the Organisation for Security and Cooperation in Europe. We stand ready to assist with these efforts.
Hey why don't you all just talk about this? You can borrow one of the meeting rooms at the UN if you like and we'll provide the coffee and biscuits.
We also call on all parties concerned to behave with the greatest extent of self-restraint and responsibility, and to decrease the tensions.
Okay you can see we aren't armed. Now put down the weapon and don't touch that gas tap.. please? Let's take a deep breath and we'll have a nice cup of tea and, err what else?
We note that Russia’s actions in Ukraine also contravene the principles and values on which the G-7 and the G-8 operate. As such, we have decided for the time being to suspend our participation in activities associated with the preparation of the scheduled G-8 Summit in Sochi in June, until the environment comes back where the G-8 is able to have meaningful discussion.
As is fashionable when we run out of or can't find any actual laws being broken we accuse you of being MORALLY wrong and hence we are morally right not to come to your morally wrong party until you start behaving morally right. So there. (Hey who wrote this "until the environment comes back where" bit? A Google translator bot?)
We are united in supporting Ukraine’s sovereignty and territorial integrity and its right to choose its own future. We commit ourselves to support Ukraine in its efforts to restore unity, stability, and political and economic health to the country.
When we say commit we mean we are resolute and determined to appear strong and unified and hope that no one asks what we will actually do. Oh they will? Err, oh hell.. how about..
To that end, we will support Ukraine’s work with the International Monetary Fund to negotiate a new program and to implement needed reforms. IMF support will be critical in unlocking additional assistance from the World Bank, other international financial institutions, the EU, and bilateral sources.
There. We'll give them an overdraft facility. That should solve it shouldn t it? It sort of worked for Greece and Ukraine is near Greece isn t it? And they both have nuts Eurovision song contest entries. Or was that Azerbaijan?
Has Russia backed down yet? Oh please God make that nutter back down because he's too big for us to "Sadam Hussain". He's got Nukes??? You're F##kin kidding me..... Michelle? Where're the bunker keys???
We, the leaders of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States and the President of the European Council and President of the European Commission, join together today to condemn the Russian Federation’s clear violation of the sovereignty and territorial integrity of Ukraine, in contravention of Russia’s obligations under the UN Charter and its 1997 basing agreement with Ukraine.
We the G8 (oh we can't say that can we, how about G7? Just stick our names down) have in our hands a piece of paper signed my Mister
We call on Russia to address any ongoing security or human rights concerns that it has with Ukraine through direct negotiations, and/or via international observation or mediation under the auspices of the UN or the Organisation for Security and Cooperation in Europe. We stand ready to assist with these efforts.
Hey why don't you all just talk about this? You can borrow one of the meeting rooms at the UN if you like and we'll provide the coffee and biscuits.
We also call on all parties concerned to behave with the greatest extent of self-restraint and responsibility, and to decrease the tensions.
Okay you can see we aren't armed. Now put down the weapon and don't touch that gas tap.. please? Let's take a deep breath and we'll have a nice cup of tea and, err what else?
We note that Russia’s actions in Ukraine also contravene the principles and values on which the G-7 and the G-8 operate. As such, we have decided for the time being to suspend our participation in activities associated with the preparation of the scheduled G-8 Summit in Sochi in June, until the environment comes back where the G-8 is able to have meaningful discussion.
As is fashionable when we run out of or can't find any actual laws being broken we accuse you of being MORALLY wrong and hence we are morally right not to come to your morally wrong party until you start behaving morally right. So there. (Hey who wrote this "until the environment comes back where" bit? A Google translator bot?)
We are united in supporting Ukraine’s sovereignty and territorial integrity and its right to choose its own future. We commit ourselves to support Ukraine in its efforts to restore unity, stability, and political and economic health to the country.
When we say commit we mean we are resolute and determined to appear strong and unified and hope that no one asks what we will actually do. Oh they will? Err, oh hell.. how about..
To that end, we will support Ukraine’s work with the International Monetary Fund to negotiate a new program and to implement needed reforms. IMF support will be critical in unlocking additional assistance from the World Bank, other international financial institutions, the EU, and bilateral sources.
There. We'll give them an overdraft facility. That should solve it shouldn t it? It sort of worked for Greece and Ukraine is near Greece isn t it? And they both have nuts Eurovision song contest entries. Or was that Azerbaijan?
Has Russia backed down yet? Oh please God make that nutter back down because he's too big for us to "Sadam Hussain". He's got Nukes??? You're F##kin kidding me..... Michelle? Where're the bunker keys???
38 comments
Click here for commentsC says
ReplyOn a positive note at least this time they won't have to manufacture any claims about 'weapons of mass destruction'.
Talking about positive notes, no , not the ones delivered to your email box recommending Bull/Spreads. The one about our own Aussie Cate picking up an Academy for Best Actress in Blue Jasmine..good on you Cate!..us here never had any doubt you'd come through for us, your a trooper!
Replyhttp://www.huffingtonpost.co.uk/2014/03/03/the-suns-front-features-a_n_4888432.html?utm_hp_ref=uk
ReplyWe all worry about the political risk of owning shares of assets in countries with pseudo-representative democracy, powerful oligarchs, unfair taxation, military adventures, and unconstitutional security state activity, but despite this we DO actually own US stocks.
ReplyGazprom $ ADS down 13% in UK trading and € shares down 12% in Frankfurt. OGZPY likely to open below $7 this morning which represents a 10% discount from Friday's trade. If you buy here you will be buying shares of a huge multinational oil and gas company. You are buying a stock with a P/E of 2, and a dividend yield that might approach 8.
From my perspective, buying in Russia is no different, except that the risks of investing there have been priced in to the shares of Gazprom, whereas the risks of US investing are not necessarily priced in to shares of Exxon Mobil, for example.
It's a really good day to have a lot of Treasuries, all things considered. Kevlar gloves at the ready. Hard to know how far Russian shares can sink, since there aren't very many people left to sell. Gazprom OAO ADS traded at 6.50 last summer. at the depths of the crisis in 2008, they did reach about 6. A lot of this is/was due to the surge in USDRUB, which has probably reached extremes now, especially since the Russian Central Bank hiked rates today. Was this a good buy at $17 in 2011? Or at $30 in 2007? Not so much. Down here at 6 and 7, there just isn't that much left to go wrong.
YNDX starter.
Reply"We all worry about the political risk of owning shares of assets in countries with pseudo-representative democracy, powerful oligarchs, unfair taxation, military adventures, and unconstitutional security state activity, but despite this we DO actually own US stocks."
Replyha! thanks for such gems
Someone has to say it. Apart from the propaganda machines, there isn't a whole lot of difference between one fascist oligarchy and another republic of crony capitalism.
ReplyPutin will be quaking in his boots now, as "US prepares tougher action against Russia". Perhaps we will soon see Obama threaten Putin with "the soft cushions and the comfy chair"?
The Comfy Chair
name that movie: "Corruption is why we win"
ReplyWho will rule Ukraine at the end of the year? Odds at bookmakers now: Putin 1.50 , Obama 1.60 , some Ukrainian 100.0
ReplyMy calculations tell me that's not a fair book @ 129 percent.
ReplyIf we have learned anything here at TMM, it is that you let your judgement run with no constraints.Let it run.
C Says
ReplyRe Russian equity all I have to say ,and it's got nothing to do with macro, or even Russian equity per se, is this. After a double digit plunge you can usually put money on covering action (the bounce). The more debateable question comes afterwards. That is, when the covering stops does it simply run out of momentum, roll over and continue down on very disinterested volume. The plunge volume encompasses the herd panic action ,but the low volume that can follow signifies NFI which is applicable to negating the "not many sellers left" ,because there are not many buyers either.
Can be different of course ,but without my favourite crystal ball it's all misty.
Coming up but who knows when, QE taper-made banking crises in the developing world:
Replyhttp://www.financialsense.com/contributors/james-gruber/em-banking-crises-next
Rossmorguy
C says
ReplyThanks Ross, good link if probably a bit complex for the average direction finder.
Interestingly ,I'm looking closely now at the US dollar Index ,because is usually only inhabits narrowish ranges for about 4 months give ,or take before it makes another directional ,hurtful move if you're on the wrong side.
C,
ReplyVery astute observation, we've been watching that too, and Bucky seems to want to slip beneath the 80 line. Last year was all about the DX getting stronger b/c of the Taper and The Reflation, and as a consequence we saw the flogging of EMs, REITs, munis etc.
This year may be all about a slower US recovery, weaker DX and a return to investing in EMs over DMs. This isn't necessarily bearish US equities but we expect EMs will easily outperform, once investors see that China and Brazil have bottomed out, which may already be happening.
C says
Reply"80" wouldn't do it for me. I'm watching that 79 line.
C says
ReplyIndeed ,looking at the USD it appears more likely to be moving back up at least temporarily on a daily. I'm waiting for the weekly though for any entry and I don't know which way that entry will be at this time.
C Says
ReplyWe're certainly not lacking volatility this year. I note the leaderboards in both directions often print disparate numbers that make me think either daytraders are in charge ,or amateurs who think bluechips at or 10% on the day represents sound entry opportunities.
In effect the Ftse100 has gone nowhere as an index since last May which says a lot about rotation and churn.
I suspect there's a considerable degree of what else is there to do going on here.
C Says
ReplyGoing back over a year I was quite bullish UK when the general view was the UK was Europe's weakman etc and £ was hammered. That didn't seem to me to be representative of what I saw around me. We seemed to be muddling through and of course you always depend on the politicians to get vote buying happy. Out of that time arose some decent exports favoured by that weakfish pound and latterly some uplift in property based upon the govt/BOE backstopping the lenders freeing up liquidity.
So why am I getting itzy about the UK now? Betty's had a hell of a run some places and that £ looked to have priced in a lot of good news. Likewise property and their equities when essentially policy is electioneering and probably not an ongoing policy. Indeed , the Uk won't be much different to the US in the sense of rising prices outside London will pretty soon meet unaffordability issues even without rate rises given disposable incomes have not yet improved measurably for most people.
Again , I get the sense people are overegging the situation. The UK was not as weak as people thought over a year ago ,but today I really think they are in danger of going the other way and overestimating our strength.
Betty looks too pretty at these levels for me and going forward towards a 2015 election preceded by the Scottish vote I think there is plenty of uncertainty to make people rethink their positional stance.
C, that teeter totter of boom or bust re individuals appears to me to be due to the inappropriateness of Interest rates as the one stop tool. Keep them low and leverage increases by those that can borrow ( normally not those that NEED to borrow) creating cost pressures but raise rates and you completely stuff those that NEED to borrow. Blue sky thinking but perhaps we somehow need to limit borrowing and so reduce the resultant leverage not by price but by some other metric. "UK budget decree that borrowing is means tested .. sorry squire you ve got grillions .. spend that .. no leverage allowed" I dunno
ReplyBut guess that would drive borrowing off shore!
ReplyC says
ReplyBy the way I really appreciated the Crimean stroke in pulling forward the vote date to the 16th March. Given the ethnic composition what price the outcome is a vote to go Russian which I presume is different to going commando? this isn't going to go down well most places. However, one has to admire Putin strategical nous in handling the western bureaucrats.
C Says
ReplyIndeed Pol.
Russia has produced many chess grand masters. In this case, Putin is beating the G(8-1) champs on seven different boards simultaneously with one hand tied behind his back, while eating a sandwich and reading sexts from Sarah Palin on his iPhone.
ReplyBloombags had a chart of USDRUB today, with the headline "The Ruble cannot strengthen", which made me wonder whether perhaps that trade had already run its course.
Have to agree with C on Betty. She's tottering around on nine inch heels at this point, which is fun to watch but she'll end up on her back again fairly soon.
Bucky's bid to achieve lift off from 80 failed again. At this point only yen carry is sustaining the old lad. Sorry, C, he's tired and he wants to go to bed, for a nap.
From LNB's vantage point between the Mianus and the Housatonic, Connie Consumer looks pretty shagged out from keeping the kids fed and warm all winter and shoveling snow, so her ability to boost demand for US retail goods looks to be quite limited.
Whispers from the Asian links of the supply chain suggest that orders are off and shipments of plastic thingies will be slow for some time to come. It's not just the weather, it's what the heating bills did to the US household budget.
Dr Aghi: 0.4pp of disinflation due to EUR strength.
ReplyThis is bad news for USD and GBP bulls as it means the ECB reckon they can quantify stuff and might stomach some more of this German medicine. 1,5000 anyone?
Loads and loads of USD and GBP longs out there v. no love for EUR and JPY. It's about time for a turn.
C says
Reply"Sorry, C". No reason for you to be. I really don't have a directional conviction on the USD. For me the level t make or break downside is 79 and 80.5/6 upside ,but either must be on a weekly close not a daily. yesterday it was smidgen over 80 so nothing is decided for me at this point.
Agreed, dollar direction still in the balance for now.
ReplyC Says
ReplyAs the week ends I thank the Ukraine and poppers for another chance to add a slice of short to my equity position. Patience is the name of this game. At this time breadth still suggests the losers are rising and that means the rotation is concentrating yet again in a lower number of stocks. Doesn't usually signify immediate crash mode although flash crash can and does occur sometimes before one get's fully loaded. Also explains why we such silly moves in bluechips on any given day when all the little Johnnies club together to play.
$a short squeeze pain. The rba is snookered. How long before the mono croud jump on that one ? Ltl
ReplyC Says
ReplyLove it. Unemployment number wee spike up then bang. Bring it on.
Hours worked actually DECLINED. Hourly wages up about +0.4%, hours worked down -0.3%. Sounds like inventory build, orders down, less overtime worked and wait and see before they lay off workers.
ReplyWhatever Johnny is buying today, YOURS.... we'll take some fixed income today, thank you very much.
FED to Mr Market:
Reply"OK, so QE didn't work. You said it wouldn't, b/c there's no aggregate demand. The jobs market still s*cks giant donkey d*ck. But we made our constituency happy with free money, so Eat Me. But we are still going to Taper, b/c we said we were going to, when our QE policy worked. Which it has. Sort of. So, to our buddies, we are f**king Tapering, but we aren't hiking for ages, b/c the economy does still s*ck giant donkey d*ck. But as the MBS and Ts mature and run off, our balance sheet is going to contract slowly, so don't get left holding the bag with those small caps, sell them now to some d*ckhead who doesn't know how the system works."
C Says,
ReplyLB, looks like the puntariat still like cheap could be cheaper on Russia.
http://www.bloomberg.com/news/2014-03-07/putin-s-push-shorted-in-etf-market-as-cheap-get-cheaper.html
On a rough and ready take it would look likely that with that kind of interest we're going to see some wide swings in front of us where covering meets bottom feeding.
For the future this could develop into something really interesting on a fundamental value basis. The no rush, pick up a bit as we go as that volatility ultimately dissipates.
Agree. Russian assets worth looking at on the days of big dumps for the time being. The point on Gazprom is that if you fill 50% of the natural gas demand of Eastern Europe you are going to be in decent shape.
ReplyBrazil also cheap, can't get a lot cheaper.... seems to be dumped every time we get bad news from China.
China, oddly enough, still not cheap, probably going to get a lot cheaper one day, maybe this cycle, but maybe not until further down the road.
Skippy has been on the ground in Russia this week. Crimea is gone as far as the alpha dog (Putin) is concerned. However, it is not clear whether he wants the rest of Ukraine just yet.
ReplySkip senses deep revulsion on Russian equities locally, not just globally. On the weekend before last, money changers were not changing hard currency - although it was still available in most ATMs. While the CB has decent reserves, that contributed to the rate decision last week.
Just to add, Blog still accessible from Russia (unlike China)
ReplyInteresting stuff, Skippy. We did fill our boots once more last week with Gazprom, and have an eye on the Revulsion Meter at all times. Speaking of which....
ReplyCurrently eyeing Brazil after two plunges in Dr Copper have resulted in back to back woodshed trips for Brazilian equities. Avid macro watchers might be surprised to learn that Brazilian govies 10s, are +12%, while Greek are 6.8% and Spain 3.3%. Brazil as risky as Greece and Spain combined? Shurely, shome market ineffishiency? VALE, EBR and CIG yield all quite attractive here, surely even PBR will not decline in price in perpetuity...?
But the real attraction of Brazil in general is that it might now be standing on the threshold of two decades of mild disinflation that would be a dream environment for investors, like buying US Treasuries or equities in 1982?
C Says
ReplyNo boot filling here. I'm interested in where this goes ,but that's future tense.
Problem is I am topdown man. I see US fiscal policy tighter (nevermind monetary policy which I think is delusional anyway) along with China trying to squeeze it's credit cycle back into a box not labelled 'Pandora'.
I think risk globally owes me one real risk puke out of the US before I am willing to think that cheap is not going to be going cheaper. The theory is simple, if US equity revalues then every single equity market in the world will follow it. because this time won't be different.
There are countries like the UK where opinion seems optimistic ,but again I just think people are not joining up the dots. What we've got here is either export lead and subject to a coldwind ,or hopelessly concentrated in property where the limitations are quite obvious one's.
Indeed when it comes to export models we're in an everyman for himself world that doesn't even pretend to have a global approach any longer.
Yes,talking about the Property market and the Global sphere, be that I've metamorphosed into a ultra time frame trader since mid last year. Maybe you can see the ending already?...seriously. Real estate and Casino markets have been banging it out consistently harder the last 12 months, and for me these sector players seemed to think the show can go on forever. Yes , I do think the market is overdone, hard! but there's no way I'm stepping in front of it. But what I will do is invite some of my more culturally inclined friends around ( the goths,grunges,punters,hippies,cowboys,artists-philosophers-you get the idea) grab the popcorn and sit back and enjoy the display of watching decades of intangible investments strewn across the toilet floor in the name of being able to sit back and collect annual annuities off the one arm bandits.
ReplyPs..Popcorn taste good, and the company couldn't be better!