Baltic Dry Index. 1015 +73
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
Due to travel, today’s update is briefer. However,
I note the sudden surge in the Baltic Dry Index. A precurser to war, i ponder.
War was avoided over the weekend and if the spin
from Kiev is to be believed, the end is nigh for the Russian separatists. With virtually nothing being produced in
eastern Ukraine and western Ukraine on the IMF/USA/EU dole, my guess is that
blowback from unwise sanctions on Russia will make this year’s soon to arrive “Crash
Season” a crash season to remember in the dying EU.
Ukraine army pushes into rebel stronghold of Luhansk
Government says state flag raised over police station in separatist-held city, as foreign ministers of Russia, Ukraine, France and Germany meet in Berlin to discuss crisis
By Tom Parfitt, Moscow 7:04PM BST
17 Aug 2014
The Ukrainian army pushed into a
key city controlled by Russia-backed separatists on Sunday, the government
said, as the two countries' foreign ministers met in Berlin for crisis talks.
Kiev also admitted the rebels had
shot down one if its fighter aircraft, while accusing the separatists of
bringing three missile launchers onto Ukrainian territory from Russia.
Andriy Lysenko, a Ukrainian
military spokesman, said government forces had advanced into the Zhovtneviy
neighbourhood in the northeast of the besieged city of Luhansk and taken
control of the neighbourhood police station.
"They raised the state flag
over it," he told a news briefing.
Luhansk, with a peacetime
population of 420,000, is the second largest stronghold being defended by the
rebels in eastern Ukraine, whose main bastion is the city of Donetsk, 90 miles
to the west.
Seizing Luhansk would be a major
victory for Kiev, disrupting alleged supply lines from Russia. A picture posted
on Twitter appeared to show the Ukrainian flag being fixed on the side of the
police station, but it could not be independently verified.
As fighting continued, Sergei
Lavrov, Russia's foreign minister, and Pavlo Klimkin, his Ukrainian
counterpart, flew to Berlin to meet with Germany and France's top diplomats
More
Asian stocks stall as Ukraine sours mood, dollar sags
By Shinichi Saoshiro TOKYO
(Reuters) - Asian stocks
stalled and the dollar sagged against the safe-haven yen on Monday, as another
bout of tensions in the Ukrainian conflict sapped investor confidence.Spreadbetters are picking European shares, which already had a chance on Friday to absorb renewed tensions in the Ukraine, to fare better. They forecast Britain's FTSE .FTSE to open as much as 0.4 percent higher, Germany's DAX .GDAXI 0.8 percent and France's CAC 0.6 percent .FCHI.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was effectively flat, treading water through most of the day. The index had gained 2.5 percent last week, its largest weekly rise in nearly five months.
Tokyo's Nikkei .N225 inched up 0.1 percent.
News late on Friday that Ukrainian forces said they had destroyed a Russian military column in Ukrainian territory initially hit Wall Street, drove down government bond yields and boosted safe-haven currencies such as the yen and Swiss franc.
----Still, with the four-month conflict reaching a critical phase over the weekend - Kiev and Western governments are nervously watching if Russia will intervene in support of the increasingly besieged rebels in eastern Ukraine- risk appetite was subdued.
"A feeling of complacency had been creeping back into investor psychology last week with a general feeling that perhaps the declines at the start of the month were overdone," Jasper Lawler, market analyst at CMC Markets, said in a note to clients.
"The encounter in Ukraine was a hefty reminder that geopolitics cannot be ignored," he said.
More
In other news, did China’s bubble just pop? If it
did, is crash season coming early in 2014?
China Home Prices Fall in Majority of Cities on Weak Demand
Aug 18, 2014 4:09 AM GMT
China’s new-home prices
fell in July in almost all cities that the government tracks as tight mortgage
lending deterred buyers even as local governments eased property curbs. Prices fell in 64 of the 70 cities last month from June, the National Bureau of Statistics said today, the most since January 2011 when the government changed the way it compiles the data. Beijing prices fell 1 percent from June, posting the first monthly decline since April 2012.
“The falling trend of China’s property market has no sign of improving,” Shen Jian-guang, Hong Kong-based chief Asia economist at Mizuho Securities Asia Ltd., said in a phone interview today. “The key issue is the mortgages, despite all types of local government easings. The high rate is damping sentiment of owner occupiers.”
China’s property market has become a drag on the world’s second-biggest economy, prompting cities to start easing local curbs in June. Thirty-six cities had loosened measures as of the end of last week, according to Centaline Property Agency Ltd., while developers have cut prices since March to lure buyers. The International Monetary Fund has urged China to target slower expansion in 2015, saying the economy faces a “web of vulnerabilities” from rising debt and financial institutions’ exposure to real estate.
More
China’s First Bond Default in Focus as Debtholders Meet
Aug 18, 2014 4:22 AM GMT
Holders of China’s first corporate bond to default onshore plan to meet
today in Shanghai,
as investors look for clues on how the government will balance market
liberalization with steps to maintain stability. Investors in notes of Shanghai Chaori (002506) Solar Energy Science & Technology Co. will gather this afternoon as they seek repayment, Vice President Liu Tielong said by phone. Shanghai marked a milestone in corporate bankruptcy in June when a court accepted a restructuring application for the solar-panel maker.
While Premier Li Keqiang said defaults may be unavoidable in some cases after Chaori failed to make a full coupon payment on March 7, the country has averted similar cases since. Widespread bond nonpayments would cause financial market turbulence, which can’t be allowed when the economy faces “relatively heavy” downward pressure, according to a front-page commentary in a central bank publication today.
Chaori only paid 4 million yuan ($650,755) of an 89.8 million yuan coupon due in March on its 2017 bonds, becoming the first company to default on a yuan note onshore.
The Shanghai No. 1 Intermediate People’s Court accepted the restructuring application from Chaori’s supplier, Shanghai Yihua Metal Materials Ltd., because the solar-panel maker can’t repay overdue debt, according to a statement posted on the court’s website on June 27. As of March, Chaori’s liabilities were more than 700 million yuan greater than its assets, according to the statement.
More
At the Comex silver depositories Friday final figures were: Registered 59.88 Moz,
Eligible 116.31 Moz, Total 176.19 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, more on our new lawless age, as the great
disconnect in the Fed’s final bubble soars. Another “Mission Accomplished” for
the west in the sands of the Sahara.
Unidentified war planes, explosions heard in Libyan capital
TRIPOLI(Reuters) - Unidentified war planes flew over the Libyan capital Tripoli early on Monday and explosions could be heard, residents said.
A Libyan TV channel said planes
targeted positions in Tripoli where militias have been fighting for control for
over one month. None of the militias is believed to own war planes.
Government officials could not be
reached for comment.
Tripoli residents said they could
hear several explosions but said the cause was unclear. The city was quiet
afterwards.
Militias from the city of Misrata
and fighters allied to the western town of Zintan on Sunday again traded
gunfire in parts of Tripoli, part of growing chaos in the oil producing nation
three years after the ousting of Muammar Gaddafi.
Three years since Gaddafi's rule
ended, Libya's fragile efforts towards democracy are close to chaos. A month of
fighting in Tripoli and Benghazi has further polarized the political factions
and their militia allies.
Libya's weak government has no
functioning national army and almost no control over Tripoli, with most
officials working from Tobruk in the far-east where the new parliament has
set-up to escape the violence.
Most of the fighting has raged
over the international airport in Tripoli, which fighters from Zintan have
controlled since sweeping into the capital during the 2011 war.
The militia battles have forced
the United Nations and Western governments to evacuate diplomats, fearing Libya
is sliding into civil war.
On Sunday, the U.N. Mission in
Libya said in a statement that it "deeply regrets that there was no
response to the repeated international appeals and its own efforts for an
immediate ceasefire."
More
The monthly Coppock Indicators finished July.
DJIA: +157 Down. NASDAQ: +318 Down. SP500: +232 Down. The Fed’s final bubble has taken on a
very scary wobble, but this is nothing compared to the return of real interest
rates at some point ahead.
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