Right. The Kiev army always attacks on Thursday and then withdraw on Saturday.
But this time could be serious: according to RT, at least 25 pro-Russian activists were discovered to have been choke to death. If this is confirmed, then further escalation of the conflict is likely.
As you know, Obama's people knew exactly how Putin will react, so they are creating the very conditions for him to react --- direct Russian Intervention.
Rationally, they will pump the oil price up to assist Russian economy.
US, in my view, tried to achieve two objective with the Ukraine Crisis: weaken Russia, through sanction; weaken EU, hence EURO, the only alternative global reserve currency to US Dollar.
Things are getting serious now. The civil war is very much likely. It should serve US foreign policy well.
Finally, the market caught up with the Ukraine Crisis/Civil War, after the market professional have loaded up on the short positions. So the downside could be as much as 30%, as predicted by many market bears.
I want to make it clear that this is my educated guess. I have no idea what kind of position or risk exposure JPM might have on Eastern EU credit. But with all kind of "hard-to-value" and "over-the-counter" instruments, it is almost impossible for even the CEO to discover any large loss generating leveraged bets until many months later.
The same can be said about many global banks.
US wants a Ukrainian Civil War. Russia probably prefer that outcome too, though it does not the fact that the turmoil happens close to its border.
So the losers on Eastern EU Credit trades are expected to lose more, way more, than their risk management would be able to control.
It is more than what meets the eyes. Please educate yourself by reading "The Grand Chessboard" by Brzezinski, if you have not. Actually, you can download a free pdf file by search it online.
It helped me to have a deeper understanding about this grand chess game played.
AIG needed government bailout in 2008 because it sold massive amount of Credit Default Swap contracts on Subprime Mortgage Bond and CDOs, and suffered tens of billions dollar of loss.
What now? CDS contracts on Eastern EU Credit spreads?
The turmoil in Eastern EU credit market will spread to Credit Default Swap market, and will likely wipe out the parties on the losing side of the trades.
But because CDS contracts are traded only "over-the-counter", nobody, not even Wall Street professionals, know who is holding what. It could be AIG, some of the major global banks, and some hedge funds.
It is hard to say whether we will see the same "liquidity crunch" in 2008, given the reforms in the financial system.
I think that Ukraine Crisis is related to the diminishing influence of US Dollar as global reserve currency. It is going to happen, I assume.
The problem is that we do not have insider information, and the media will not report any of this until it is already too late. So maybe it is time to cut risk exposure.
NASDAQ is in sell-off mode again, I have to conclude that whoever lost big on Eastern EU Credit bet are liquidating their winning positions on NASDAQ stocks. If this is indeed the case, then expect at 10% further decline on NASDAQ dices.
Right. US so far only gave $1 billion loan guarantee as the economic assistance to Ukraine. In return, Ukraine would likely need to buy tens of billions of weapon from US using the fund just received IMF.
Who is going to lose big? The average Ukrainian.
Now you know. The big players can start the war, and can crash the market. Under normal circumstances, they would prefer doing it as naturally as possible. But we are living in a "new normal". ;-))
On the western front:
May 9, WW2 Celebration in Crimea
May 11, Referendum in two Eastern Ukrainian cities.
On the eastern front:
Japan is prompted to join NATO.
Geopolitical risk between US/EU and BRICS camps. ;-))
Right. Just try to be positive there.
She is handling a very tough job at a very tough period of history. Wish her good luck!
Do not forget she is just a front person of massive forces.
But some people do not really like true democracy. That would likely introduce volatility to the global market.
Also, Japan is invited to join NATO. So we are having a war between US/EU and BRICS.
I have to guess that the US Dollar is really the contention point here. EU is held hostage.
as the global reserve currency.
The Ukrainian Crisis and the simultaneous "fight" with Russia and China are all about the status of US Dollar as the global reserve currency.
I sense the desperation there.
Expect further decline in US Dollar, if the Ukrainian crisis is resolved through splitting the country in half.