The European Central Bank promised in January to "review and reconsider" its monetary stance this week. The question, as BloombergBriefs notes, is not if policy makers will ease but how. Haruhiko Kuroda's humbling in FX markets shows what Mario Draghi is up against tomorrow: namely, that even the most forceful policy decisions can be overwhelmed by events, positioning, or sentiment.
Russian President Vladimir Putin has ordered the deployment of all of Russia’s RS-26 intercontinental ballistic missile systems, ahead of what the Russian Ministry of Defence say is an “impending” attack of the U.S. and Europe by ISIS militants. The RS-26 missiles are considered Russia’s “doomsday weapon”, packing in 1.2 megatons into its four 300 kiloton warheads. They are capable of hitting targets throughout the U.S. with their 11,000 kilometer range.
Liquidity worries are so 2015.
In the new year, there are much more pressing concerns.
Like a possibly imminent, overnight yuan float, which would quite simply torpedo every risk asset on the planet even as it would probably be just the thing Beijing’s economy needs to secure long-term stability.
Everyone assumed it would be the threat (or the reality) of international terrorism that would ultimately break Europe’s resolve when it came to goodwill towards Mid-East refugees.
Indeed, we remember vividly when the first reports of a “Kalashnikov assault” on cafes in the French capital hit social media on that fateful Friday in November.
“That’s it,” we assumed, for Europe’s experiment with an open-door migrant policy.
Authored by Paul Brodsky of Macro-Allocation.com,
The Triumph of Politics
All of life’s odds aren’t 3:2, but that’s how you’re supposed to bet, or so they say. They are not saying that so much anymore, or saying that history rhymes, or that nothing’s new under the sun. More and more theys seem to be figuring out that past economic and market experiences can’t be extrapolated forward - a terrifying prospect for the social and political order.
Consider today’s realities: