CEO Of Rosneft Compares Oil Market Manipulation Which “Doesn’t Reflect Reality” To Gold Price Rigging

It was a little under two years ago when, when oil and gas prices were both surging, Obama decided to punish the evil speculators whose fault the rise of oil was when he announced he would “give the Commodity Futures Trading Commission authority to increase the amount of money that a trader must put up to back a trading position. The administration officials said such authority could help limit disruptions in energy markets.” Needless to say, Obama did not punish the world’s central banks for flooding the globe with excess liquidity, which by definition would end up in less than “productive” ventures such as barrels of oil. Over the weekend, it was the opposite, when instead of blaming speculators for soaring prices, none other than the CEO of Russia’s largest publicly-traded oil company, Rosneft, in not so many words, accused speculators of sending the price of oil plunging. Which […] Read More

Even The Algos Are Looking Forward To Today’s Early Close

Today’s early close across markets likely means that the blow-off top multiple-expansion mania phase (because forward EPS estimates over the past couple – that means 2 to Janet Yellen fanatics – weeks have in fact declined) of 2014 may be coming to an end. However with already abysmal volumes literally grinding to an early halt at 1:15 pm Eastern today, and with a market as boring as this one, where any news is immediately interpreted as good, not matter how bad it actually is or how “revised” or “goal-seeked“, we may see futures, which already are trading some 4 points above fair value, successfully levitate by another 20 points and hit Goldman’s 2100 year end target – year-end for 2015 that is – one year ahead of time. There has been no macro news in the overnight session to talk about, with Asian markets surging on the back of […] Read More

Russian Food Suppliers Have Begun Halting Shipments

Until now, when it comes to the fallout in the Russian economy from the crude price plunge leading to a collapse in the Russian currency, most of the interest has been on how the Russian financial system recovers and/or survives and just as importantly, what Putin‘s response would be. Just yesterday, we wrote that as a result of capital controls fears, many western banks led by Goldman Sachs had halted liquidity to Russian clients and other local entities. However while the adverse impact on the Russian banking system has been mostly confined to the upper class – since there is virtually no middle class in the country to speak of – the second cold war of words, which rapidly morphed into a very hot financial war, is about to hit the very ordinary Russian on the street, because as Russia’s Vedomosti reports, citing vegetable producer Belaya Dacha, juice maker […] Read More

The End Of Exuberance?

Submitted by Sean Corrigan via True Sinews blog, Back in the halcyon days of summer, it seemed nothing could go wrong. Commodities were still things it was not utterly disreputable to own. Base metals had shaken off a springtime swoon to hit 18 month highs. Though still suffering from that enervating, post-bubble flatness, precious metals had just enjoyed a neat little 10% rally. Energy was threatening to print new 2 ½ year highs as WTI sold for more than $107 at the front and $86 at the back of the curve. Nor were people much interested in paying for downside protection: across the complex, options premia were as low as ever they had been in recent years. Volatility – and risk measures in general – were drifting ever southwards, everywhere you looked. The US equity market’s VXO index was being quoted in single figures, the lowest in its 29-year […] Read More

Starting Monday, Billions In ETNs Are No Longer Marginable Collateral

When is marginable collateral not marginable collateral? When it is an ETN, or Exchange Trade Note: the cousin of the Exchange Traded Fund (ETF). The very mutated, and unabashedly evil cousin of the ETF that is. At least such is the view of US brokerage Interactive Brokers (and certainly not of the ECB where as is widely known blocks of feta cheese and olive oil are perfectly acceptable forms of collateral). First, what exactly is an ETN? Here is the IB definition: ETNs are not equity shares but rather a form of unsecured debt whereby the issuing institution promises to pay a return linked to a market index or other benchmark. As ETNs generally do not buy or hold assets like an Exchange Traded Fund (ETF), their returns are realized through holdings of derivative contracts such as options, futures and swaps. While ETNs trade on exchanges in a manner […] Read More