2014/09/01 TrendView VIDEO: Global View (early)
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TrendView VIDEO ANALYSIS & OUTLOOK: Monday, September 1, 2014 (early)
Invasion or no invasion? Is that really the question? As we note in the early phase of our analysis, any confusion as to whether Russia has ‘invaded’ Ukraine is moot. There are definitely Russian troops across the border, as Master Dissembler Putin is keeping on the pressure without needing to do anything quite so bold as invade. He is merely keeping his options open (and domestic popularity rating high) by maintaining the destabilization of eastern Ukraine to the degree necessary to exercise control. Especially in light of the dithering of the Western powers, this is an effective approach, even if the equity markets are occasionally disturbed by the more active fighting phases.
And the wailing and gnashing of teeth in the West on Russia being a reprobate throwback to the 19th century doesn’t really count for much. They are also just not doing much about it. Europe’s commercial ties to Russia (including that critical dependence on natural gas supplies) and the US aversion to any involvement anywhere (beyond the rhetorical and sanction pressure) means Putin can proceed as he’s planned. It is important to keep in mind that he doesn’t want to ‘own’ the Ukraine and its Brobdingnagian debts, he merely wants to control it; both the resources in its east, and preventing NATO membership.
Why is all this important to the markets? Because it will be a drag on the already weak Euro-zone economy for one. And that plays right into the other factor that is a key right now: the equities return to a ‘bad news is good news’ psychology on recent central bank indications (even in spite of the slight shift toward center by Janet Yellen.) Anyone who doesn’t understand that shift merely needs to look at how well equities are holding up on the serial weak Asian and European economic data over the past couple of weeks. While the have been some high points in US data of late, all of the overnight data elsewhere has consistently been somewhere between weak and abysmal. And yet, US equities are up in spite of even US Personal Spending coming in negative versus a positive expectation.
Video Timeline: It begins with macro (i.e. fundamental influences) discussion of some all the weak recent data in spite of some high spots in the US last week. However, even there Friday’s Personal Spending figure coming in at -0.10% versus 0.20% expected is a weak sign for the US consumer. The review of the non-US and non-Canadian data (both Closed for Labor Day holidays) was quite weak again on balance from Asia right through Europe.
It moves to SEPTEMBER S&P 500 FUTURE short-term view at 03:00 and intermediate term at 05:20, then the OTHER EQUITIES from 07:35, with GOVVIES analysis beginning at 12:20 and SHORT MONEY FORWARDS at 20:30. FOREIGN EXCHANGE begins with the US DOLLAR INDEX at 24:15, jumping over to EUROPE at 25:30 and ASIA at 28:20, followed the CROSS RATES at 31:40 and a return to SEPTEMBER S&P 500 FUTURE at 36:30 for a final view and additional perspective. As this is an especially extensive analysis, even more so than usual we suggest using the timeline cursor to access the analysis most relevant for you.
Authorized Gold and Platinum Subscribers click ‘Read more…’ (below) to access the balance of the opening discussion and TrendView Video Analysis and General Update. Silver and Sterling Subscribers click ‘Read more…’ (below) to access the balance of the opening discussion.