How Big Data and Poker Playing Bots Are Taking the Luck Out of Gambling

From The Kernel:

In his new book, The Perfect Bet: How Science and Math Are Taking the Luck Out of Gambling, Adam Kucharski details how trying to understand dice games led one mathematician to develop probability theory, how one of the first wearable computers was designed to covertly predict the fall of a roulette ball, and how poker-playing bots are advancing more quickly than we think. As he

How to Get a Job In Venture Capital

In a 2014 post* I introduced the writer thusly:

And now Mr. Turck (*"Partner at FirstMark Capital. Previously, Managing Director at
Bloomberg Ventures and before that, co-founder of TripleHop
Technologies, acquired by Oracle....")
In this first paragraph of a post from last September I don't think he was talking specifically about Marc Andreessen but...

Playing “fake VC” (or the portfolio

Bonhams Auctioneers Has Allegedly Installed Sprinklers To Douse Homeless Outside the Building

It seems they got the idea from the Archdiocese of San Francisco.
Now, the auctioneers may think they are offering the homeless a cool, refreshing shower but boy the optics are bad.
From Curbed San Francisco:

SF Luxury Auction House Allegedly Turns Sprinklers on Homeless [Update]
Dousing the homeless with water as a preventative measure is nothing new in San Francisco 


Potrero Hill's Bonhams

Noah Smith: "Economics Struggles to Cope With Reality"

From BloombergView:

There are basically four different activities that all go by the name
of macroeconomics. But they actually have relatively little to do with
each other. Understanding the differences between them is helpful for
understanding why debates about the business cycle tend to be so
confused.

The first is what I call “coffee-house macro,” and it’s
what you hear in a lot of

Questions America Wants Answered: "Is the Jetpack Movement Finally Taking Off?"

From the Wall Street Journal, June 7:

..."Even Google couldn’t make it work. 'The jetpack is a death trap because
the engines go off and you’re dead,' says Astro Teller, the head of X,
the so-called moonshot factory of Google parent Alphabet Inc.
His team dropped the jetpack in favor of a gyrocopter—essentially a
backpack helicopter that descends slowly thanks to a rotor that turns

What’s the point of virtual reality?

If the psychologists are correct that the mind eventually accepts as real what is actually just virtual or imagined,* one natural endpoint is to use the technology to indoctrinate children to look up to me. In more ways than just physically.
And there will be no more back talk, short ones.

From techcrunch, May 26:

VR needs content if it’s to be more than a flash in the early adopter pan. But 

On the productivity puzzle: Does business investment explain it all?

Following up on last week's "Productivity Growth: It's the Investment, Stupid".
James Pethokoukis at AEI's Ideas blog, June 10:






This, I would venture, is a pretty illuminating econ chart. It comes from the White House econ team.
Productivity growth has been glacial since the end of the Great
Recession. And a collapse in “capital intensity” plays the biggest role.
From the CEA’s Jason

Google is Working on a Kill Switch to Prevent an Artificial Intelligence Uprising

From engadget:

But it isn't ready to be implemented across the board just yet.





Humans don't like the idea of not being at
the top of the food chain; having something we've created taking power
over us isn't exactly ideal. It's why folks like Tesla mastermind Elon Musk and noted astrophysicist Stephen Hawking are so determined to warn us

How to Reconcile Peak Profit Margins And The Race To The Bottom

One of the conundrums of the current landscape is the fact that overall profit margins, although coming off the record levels of a couple years ago, are historically elevated at the same time vast swaths of the economy have to run faster just to stay in place.

This piece and the embedded links give some clues as to what's going on.

From FT Alphaville:

Do digital industries break capitalism?

A

"Crude Slumps As Active Oil Rigs Rise For Second Week In A Row"

We don't put a lot of stock in the Friday moves when the rig count comes out but in this case we may be seeing a reversal of the long established downtrend. The number of active rigs is really low.
From Barron's Focus on Funds:

So much for $50 a barrel.


Crude took a leg lower in early afternoon trading after a weekly
reading on the number of active U.S. oil rigs increased. Oilfield
services

Natural Gas: EIA Weekly Supply/Demand Report

From the Energy Information Administration:

In the News:
Near-month futures contract indicates expectations of rising prices
Heading into the summer cooling season, the New York Mercantile
Exchange (Nymex) natural gas contract for July has markedly exceeded
Henry Hub spot prices, likely reflecting expectations for summer natural
gas consumption to increase substantially from current levels.

USDA World Agricultural Supply and Demand Estimates Report (WASDE), June 10, 2016

Wheat down 8.25 cents at $5.02; corn up 2.5 cents at $4.29.





FinViz
From the U.S. Department of Agriculture:

WHEAT:
Projected U.S. wheat supplies for 2016/17 are raised this
month on both increased
beginning stocks and
larger winter wheat production. Beginning stocks
are raised slightly
with a 3-million-bushel decrease in 2015/16 imports partially
offsetting a 5-million-bushel

"European Banks Are Crashing"

From ZeroHedge:

From Deutsche Bank to Credit Suisse and from Barclays to Banco
Popolare, the European banking system is getting battered this week with today's plunge the biggest in 4 months...



This is the worst two week drop in European banks since April 2012...



As Deutsche falls back to record lows...



And it's not about top get any better as Europe's yield curve collapses...MORE 

Société Générale's Albert Edwards Has Some Troubling News He Reluctantly Shares

..."We remain at the bearish extreme of the market," he wrote. 


"It is not a pleasant place. It is cold, dark, and damp. People
either don'’t speak to you or send you abusive emails. Members of
your own family pretend not to know you. Actually, I made that
last bit up."...


From Business Insider:

ALBERT EDWARDS: 'CONDITION RED ALERT' — a recession is imminent

Albert Edwards

"Angry banks complicate BOJ’s ability to deepen negative rates"

Following up on yesterday's "Deutsche Bank On the European Central Bank: We Are Governed By Idiots".
From Reuters via Asia Times:

The Bank of Japan may have run into an unexpected obstacle as it
considers expanding its extraordinary stimulus programme as soon as next
week — the wrath of the country’s powerful but typically compliant
banks over pushing interest rates deeper into negative

Good Deflation Is Good

Except, maybe, for debtors who have to run faster to stay in place on their payments.
From Ed Yardeni's Dr. Ed blog:



Why are the major central banks so paranoid about deflation? It’s
probably because they are staffed (stuffed) with macroeconomists who
associate deflation with depression. In their opinion, falling prices
make it harder for debtors to service their debts. Widespread defaults

Bayer Wants to Use Super-Powered Satellites to Improve Farming

From Modern Farmer:




Not an actual photo of a Bayer satellite. This is a stock satellite.

There's a growing movement to
harness more modern technology in agriculture, whether it's learning
from data science or implementing autonomous robots into the fields—both
of which we saw at the recent AgBot Challenge. Unsurprisingly, the industry's mega-corporations want a piece of the action.

Bank of Russia Cuts Rate First Time Since July as Risks Fade

Considering what she has had to work with, sanctions, oil prices etc., the central bank's performance has been as good as one could hope for.
From Bloomberg:



Economists were divided after rate pause lasted almost a year


Inflation surprised by remaining unchanged for three months




Russia’s central bank reduced borrowing costs for the first time in
almost a year as its focus shifts away

A fully priced-in rate cut is on cards in Russia

From Saxo's Trading Floor blog, June 9:

Higher oil and lower inflation allow room for cut
The need to keep rates high to attract capital not so pressing any more
Overseas analysts expect a 0.5% rate increase on June 10
Domestic analysts expect central bank to hold its fire



After almost a year of
keeping the Russian key rates at 11% it seems to be the time for a cut
and the central bank

Sharpen that pencil! Essay winner will become owner of Vermont newspaper

Intersting exit strategy.
From the Boston Globe:

When Ross Connelly “croaks,” he doesn’t want it to be in front of a
computer screen while he’s trying to make the deadline for next week’s
newspaper.

So the 70-year-old is offering to pass the torch and give away The Hardwick Gazette,
a weekly newspaper nestled in the Northeast Kingdom in Vermont that
he’s owned for 30 years, to the person

"From Regulating Uber to Subsidizing It"

From Reason, March 14, 2016:

On March 21, the Orlando suburb Altamonte Springs is starting a pilot program
that pays for part of riders' Uber fares. This misguided year-long
initiative has a budget of $500,000 and will cover 20 percent of each
fare for rides within the city's limits and 25 percent of each fare for
rides that start or end at mass transit stations.

Altamonte Springs is not

The 1916 Fabergé Imperial Eggs

Over the years we've looked at most of the Imperial Fabergé eggs (and one non-imperial).
Here are the two 1916 Easter eggs via Pearly's Qunol:


1916 - Steel Military
Egg







The exterior of
this egg is made from steel, coated in translucent enamel, surmounted by a gold
crown. It is divided into three sections by two smooth horizontal lines. In the
middle section, in inlaid gold, is an image

The Hottest PhD Market In the World

From The .Plan: A Quasi-Blog:

Fei-Fei Li,
a Stanford University professor who is an expert in computer vision,
said one of her Ph.D. candidates had an offer for a job paying more than
$1 million a year, and that was only one of four from big and small
companies.

--John Markoff and Steve Lohr, NYT, on the brains arms race in artificial intelligence

"What would it take to disrupt Facebook?" (FB)

Disruption as a goal is probably looking at things the wrong way around but if you are going to think it anyway you might as well think it big.

From Digitopoly:
[reposted from HBR Blogs]



To this day, Microsoft Office remains
the dominant office software suite, a position it has held since the
1990s. While competitors have emerged to appeal to different customer
niches (Google Docs with

"It Is Obvious FT Alphaville Does Not Understand Rocket Internet (RKET:GR)"

That was our headline story a year ago today.
Rocket is the little Berlin-hipster corporate-knockoff-making machine that thinks of itself as an incubator and says stuff like:


"Our proven winners generated aggregated net losses of €442 million" ($568 million)

-Rocket Internet prospectus via "How Do You Say 'Dot-Com Crash' in German?"

And they get no love from FTAV.
 Proven winners, bub.
The

Florida Man Patiently Waiting For Gawker Money To Arrive

Via the Florida Man feed:


Florida Man Begins Patiently Waiting for Gawker’s Money to Arrive pic.twitter.com/Q27lFWZ5t6
— Florida Man (@_FloridaMan) March 21, 2016

"Guard at ‘terror target’ Belgian nuclear site killed, access badge stolen – media"

From RT, March 26:

A security officer at a nuclear site was killed in the Belgian city of
Charleroi two days after the terror attacks in Brussels, local
newspaper Derniere Heure reported, citing police sources. The paper
added that the man’s security pass was stolen.

Charleroi is located 50 km from the Belgian capital.

A security guard, who was walking his dog, was shot dead in the early

Alt Investment: "How to Buy Bill Ackman, Dan Loeb on the Cheap"

I wouldn't touch the former, a little voice keeps saying Ackman is nothing more than fortuitous leveraged beta with a sidecar of front-running but it's an interesting way of looking at things. Having said that out in public, it'll probably double.
As to Loeb, maybe.
From Barron's:

Closed-end funds run by these hedge fund pros trade at a discount to net asset value.


Few prominent investors have

A Novel Co-Authored By An Artificial Intelligence Program Longlisted For Japanese SciFi Literary Prize

From the Yomiuri Shimbun's The Japan News: 

AI-written novel passes literary prize screening

The Yomiuri Shimbun

A short-form novel
“coauthored” by humans and an artificial intelligence (AI) program
passed the first screening process for a domestic literary prize, it was
announced on Monday. However, the book did not win the final prize.

Two teams submitted novels that were produced using

More On Current Oil Prices, Equities and Economic Activity

I quit supporting the Oxford comma.
Following up on the piece from the IMF blog, "Oil Prices and the Global Economy: It’s Complicated".

From Real Time Economics, Greg Ip weighs in:

One of the economy’s big puzzles is why lower oil prices have done so little to help economic growth. The correlation between oil and stocks is now strongly positive. The opposite should be true since cheaper oil is

Izabella Kaminska's Oil Trade Goes Sour: Shakespearean Tragedy Edition

Default, dear Brutus, is not in our stars,

But in ourselves, that we are underlings.

First rule of bidness: Know your counterparty or use a clearinghouse.

From FT Alphaville:


That time I defaulted on Bloomberg’s Tracy Alloway


Back in October, 2015, Bloomberg’s Tracy Alloway and I struck an OTC futures deal over a teeny, tiny vial of crude oil, which Tracy for some reason felt compelled to

"Oil Prices and the Global Economy: It’s Complicated"

From iMF Direct, Mar. 24:

Oil prices have been persistently low for well over a year and a half now, but as the April 2016 World Economic Outlook will document, the widely anticipated “shot in the arm” for the global economy has yet to materialize. We argue that, paradoxically, global benefits from low prices will likely appear only after prices have recovered somewhat, and advanced economies

Artificial Intelligence: Here's Why Microsoft's Teen Chatbot Turned into a Genocidal Racist, According to an AI Expert

Headlines from the future, today.
A twofer from Business Insider:

Microsoft is deleting its AI chatbot's incredibly racist tweets

Microsoft's new AI chatbot went off the rails Wednesday, posting a deluge of incredibly racist messages in response to questions.The tech company introduced "Tay" this week — a bot that responds to users' queries and emulates the casual, jokey speech patterns of a

What $40 Oil Means: Floor and Ceiling Edition

The writer says $35 will eventually be the new floor while we, for a couple reasons think it will be lower.
More on that after the OPEC production freeze meeting.
WTI $38.55 down $1.24; Brent $39.39 down $1.08.
From RBN Energy:

Are We There Yet? - What $40/Bbl Means To Crude Oil Markets

In the five weeks since February 11, the price of WTI crude oil on the CME/NYMEX spiked 50%, up from $26/bbl

IBM Says Their Newly Purchased The Weather Company Is An IoT Platform

And here I was thinking* the purchase was just a fancy way to mobilize Watson as a crop-insurance salesman along the lines of Google funded The Climate Corporation.

From http://www.ibm.com/annualreport/2015/why-weather-matters/:

Three Reasons Why Weather Matters
We surprised some with our acquisition of assets from The Weather Company. This is why it’s strategic







1. Weather Data + Other

"LPL: ‘Modest Stagflation’ Would Benefit TIPS"

For the last couple months we've been going on about inflation ticking up and the relative value in TIPS vs. treasuries. Here's a decent proxy, the iShares TIPS ETF, which seems to be digesting recent gains:


$113.43 up 17 cents. Closing that gap from Fed day would probably be healthy for the chart structure but it matters less than it would for a straight bond, or equity for that matter.

From

Lessons From the Mississippi Bubble--Edward Chancellor

Whenever emerging markets felt a little too frothy this last decade we'd trot out a bit of Chancellor profundity:


"Emerging market speculation tends to appear at a juncture in the economic cycle when 


declining yields on domestic bonds combine with an excess of capital to make 


foreign investments particularly attractive."

-Edward Chancellor

Devil take the Hindmost: A History of Financial

Oil: A Bit Of the 'ol Pump and Dump

Following up on yesterday's "Oil - American Petroleum Institute (API) Data - Inventory Build +8.796 Million Barrels".
WTI $40.28, down $1.17.
From ZeroHedge:

Oil Pumps'n'Dumps As DOE Reports 2nd Biggest Inventory Build In A Year, Production Drops

Following last night's API-reported yuuge build in crude of 8.8mm
barrels (and draw in gasoline and Cushing - confirming Genscape's
earlier report

British Pound: The Action Is In the Options

From Brown Brothers, Harriman & Co.'s currency maven:

Great Graphic: Brexit Fears Boost Sterling Put Buying

The UK referendum is three months away.  
Three-month options are a common benchmark for various market segments;
from speculators, to fund managers to corporations.  Events over the
past week have raised the risks that the UK votes to leave the EU.





The market has responded

New York Fed On Bitcoin

From the Federal Reserve Bank Of New York's Liberty Street Economics blog:

Is Bitcoin Really Frictionless?




The Case for Bitcoin
Bitcoin is the most popular virtual currency yet developed. Proponents
assert that bitcoin can remove frictions involved in payment and
settlement systems by eliminating the need for the financial
intermediaries that exist in traditional currencies. In this blog

Some Positive Impacts Of Russia's Ruble Devaluations On The Country's Economy--Moody's

From Sputnik:

Russian Gov't Protected Public From Oil Price Fall by Devaluing Ruble

Moody's Investors
Services said that the impact of the decline in global oil prices on
regions in Russia has been cushioned by an accompanying decline in the
value of the ruble versus the US dollar.

WASHINGTON
(Sputnik) — The impact of the decline in global oil prices on regions
in Russia has been

Oil - American Petroleum Institute (API) Data - Inventory Build +8.796 Million Barrels

WTI $41.19 down 33 cents
From ForeXlive:

Weekly oil inventory data from the American Petroleum Institute (API):
Prior was +1500K


Oil inventory build of 8796K barrels for the week


Gasoline -4302K vs -1900K expected


Distillates -391K vs -750K exp


Cushing -1370K

The big gasoline draw takes a bit of the shine off the massive oil build.

The FBI's Hack On The Apple Phone Probably Won't be Described as 'Elegant'

From Zdziarski's Blog of Things:
My Take on FBI’s “Alternative” Method

FBI acknowledged today that there “appears” to be an alternative way into Farook’s iPhone 5c – something that experts have been shouting for weeks now; in fact, we’ve been saying there are several viable methods. Before I get into which method I think is being used here, here are some possibilities of other viable methods

Financial Stability Oversight Council Considers Regulating Asset Managers Such As BlackRock

From the Washington Examiner:

Financial officials promise update on possible asset manager regulation

Top financial regulators plan to let the public in on their
plans for regulating the asset management industry sometime this spring,
the regulators said Monday.

The Financial Stability Oversight Council, the super-group of
regulators empowered under President Obama's banking reform law to

Tajikistan: Banking Crisis Nears Cracking Point

One of the countries we thought might be ripe for a color revolution this year. From January's "Report: UK, U.S., Russian troops in Libya":

Got a little (four years and counting) regime change going on here.

For those playing at home, some of the early betting favorites for 2016
are Moldova, Burundi, Tajikistan, Macedonia and Burkina Faso....
We'll probably be hearing next from Burundi as, to

Oil: Dreaded 'stealth' supply becomes reality as U.S. drillers turn on 'ducks'

WTI new front month May $41.38 down 14 cents.
Brent $41.58 up four cents.

From Reuters:

A dreaded scenario for U.S. oil bulls might just be becoming a reality.

Some U.S. shale oil producers, including Oasis Petroleum (OAS.N) and Pioneer Natural Resources Co (PXD.N),
are activating drilled but uncompleted wells (DUCs) in a reversal in
strategy that threatens to bring more crude to a

The FBI Has A ‘Possible Method’ to Unlock iPhone, Receive Postponement of Tomorrow's Court Hearing (AAPL)

From Politico:

Feds gain postponement of iPhone hearing
The Justice Department may not need Apple's help any longer.


Citing new leads about how to access an iPhone used by one of the
perpetrators of the San Bernardino terrorist attack, the Justice
Department on Monday asked to postpone a court hearing set for Tuesday
on whether Apple should be forced to help the FBI break into that
device.

"Vice Media Traffic Plummets, Underscoring Risky Web Strategy"

If I was in the media biz this would get my attention.
In December Disney put another $200 million into VICE at a $4 billion valuation, bringing their ownership to 10%.

From Variety:

Vice Media has come into the month of March looking more like a lamb than the proverbial lion.


The irreverent content brand saw its Web traffic suddenly
plunge 17.4% compared with the previous month, according

"Gawker Trial: Hulk Hogan Awarded $25 Million More in Punitive Damages"

Following up on "Gawker: Nick Denton's Is Not As Big As He'd Have You Believe".
From The Hollywood Reporter:


A Florida jury awards $25 million to punish the news site
for posting a sex tape (on top of an earlier $115 million verdict). 

 
A Florida jury has awarded Hulk Hogan $25 million in punitive
damages in his sex tape lawsuit against Gawker Media. That's $15
million from

"The Time and Place for ‘Helicopter Money’"

From the Wall Street Journal:

The promise of monetizing the debt is often too good to be true. That doesn’t mean it ought to be taboo, Greg Ip says.

With fiscal and monetary policy reaching their limits, the search for
new solutions to the world’s low-growth, low inflation rut has turned
to “helicopter money.”


The policy gets its name from an essay by Milton Friedman in 1969
that imagined

Gawker: Nick Denton's Is Not As Big As He'd Have You Believe

Net worth.
That should read Nick Denton's net worth is not as big as he'd have you believe.

What?
From Women's Wear Daily:
Gawker Asks for Leniency as Jury Deliberates Adding to $115M Judgment in Hulk Hogan Sex Tape Trial

Attorneys for Gawker Media asked a jury to show mercy when deciding on the amount of punitive damages to award to Terry Bollea, aka Hulk Hogan, after it already awarded him $

U.S. Mining & Extractive Industries: 2015 Losses Wipe Out Profits Of the Peak Of the Bubble Years

From Real Time Economics:

U.S. Mining Losses Last Year Wipe Out Profits From Past Eight Years

The U.S. mining industry—a sector that includes oil drillers—lost more money last year than it made in the previous eight.

Mining corporations with assets of $50 million or more recorded a
collective $227 billion after-tax loss last year, according to Commerce Department data released Monday. That

Apple's Plan To Be At The Center Of Healthcare: "Talk to Your iPhone and See Me in the Morning" (AAPL)

From MIT's Technology Review:

Apple wants to put its devices at the center of health care by figuring out how to solve medicine’s version of the last-mile problem. Today, Apple launched software to help hospitals and others more easily create apps that let patients manage their own conditions, such as by following a digital version of doctors’ orders, recording and tracking symptoms (with

Hurricane Risk and Insurance Pricing Coming Into the 2016 Season

Following up on Friday's "Re/insurance: 'El Niño in decline but impacting global weather, ~50% chance of La Niña'".

La Niña correlates with more hurricanes and in addition, as pointed out in the piece linked above, the now-ending El Niño bears some resemblance to what the Japanese researchers dubbed the Modoki varient, which is also correlated with more hurricanes.

From Artemis:

Will an

Agricultural Futures: "Hedge funds cover ag shorts en masse..."

They've fallen into my trap.*

From Agrimoney:


Hedge funds threw in the towel on short positions in
agricultural commodities at one of the fastest paces on record, in many cases
realising losses – although ironically raising questions about market strength
to come.





Managed money, a proxy for speculators, turned from a net
short position in the main US-traded ags of 213,000 contracts - the

"European Financial Networks: Prepare for Bloodletting to Commence"

From True Economics:

A recent paper, titled "Transmission Channels of Systemic Risk and Contagion in the European Financial Network"
co-authored by Nikos Paltalidis, Dimitrios Gounopoulos, Renatas Kizys,
Yiannis Koutelidakis (Journal of Banking and Finance, gated) tackles a
very interesting problem relating to the systemic stability of the
European banking system and the bi-directional

America Is Losing At Skyscrapers

From New York Magazine:






The Shanghai Tower (center) is the world's second-tallest building. The one on the right can also open beer bottles.





Photo:

Gensler




If you think those 1,200-foot beanpoles
going up in midtown are impressive, you should see what's sprouting in
Shanghai. According to

Home On (or off) The Road: The World's Burliest Camper Van

From Curbed:



Want a camper van that can climb up a double-black diamond, 45-degree slope and look cool doing it? Behold the KiraVan,
a tractor-trailer combo that could be the world's toughest expedition
vehicle. The yet-to-be-priced KiraVan tractor features a burly Mercedes
Unimog U500NA with a six-cylinder high efficiency turbo-diesel engine
and a four-door crew cabin. It has enough

"Report: UK, U.S., Russian troops in Libya"

Got a little (four years and counting) regime change going on here.
For those playing at home, some of the early betting favorites for 2016 are Moldova, Burundi, Tajikistan, Macedonia and Burkina Faso.

From al-Arabiya:

Saturday, 23 January 2016





Dozens of British, Russia and American troops have arrived in Libya
in support for the weak internationally-recognized government in

"Vermeer as Scientist"

From the Times Literary Supplement:




 View of Delft

It is a truism of responses to the Dutch painter Johannes Vermeer’s life and
works that what very little we know about the life stands in inverse
relationship to how intimately we relate to the work. This is only one of
many contrasts that shape our perception of the artist. His younger
compatriot Rembrandt van Rijn (1606–69) may have

Science/Not Science: Crusading Against Multiple Regression Analysis

 "A huge range of science projects are done with multiple regression analysis. The results are often somewhere between meaningless and quite damaging. ... "


From Edge:

I hope that in the future, if I’m successful in communicating
with people about this, that there’ll be a kind of upfront warning in
New York Times articles: These data are based on multiple regression
analysis. This would

Iran Leader Says Never Trusted West, Likes China Better. Also Downgrades U.S. From ‘Great Satan’ to ‘Great False Idol’

From Reuters via the Asia Times:

Iran’s supreme leader says he never trusted the West, seeks closer ties with China 

Iran’s Supreme Leader Ayatollah Ali Khamenei on Saturday called for
closer economic and security ties with China, saying Iran had never
trusted the West, as the two countries agreed to increase bilateral
trade more than 10-fold to $600 billion in the next decade.




Iran’s

3D Printing Comes Into Its Own: Fashion!

I know it's not advanced metalworking but it is still damn interesting technology.
From 3ders.org:

Berlin Fashion Week debuts Michael Michalsky's 3D printed lifelike mini mannequins

3D printing technologies are making a big splash at this years
Mercedes-Benz Fashion Week Berlin, though not on the catwalk as you
might expect. That is to say, reputable German fashion designer Michael

Trapped In the Snow With That Brother-In-Law Who Won't Stop Talking? Consider the Cannibal Lifestyle

Apparently there is some upside beyond even the blissful tranquility of silence.
From our 2010 post "Bite Me: An evolutionary case for cannibalism":

While
strolling last month through one of the dimly lit backrooms in a wing
of the National Galleries of Scotland, my inner eye still tingling with
thousands of Impressionistic afterimages, pudgy Rubensian cherubs, and
gothic quadrangles,

Felix Zulauf: «From Buy the Dips to Sell the Rally»

Mr. Zulauf is one of the more accurate members of the Barron's Roundtable gang, happening this month and which we'll link to after they wrap up next week. For now here he is at Switzerland's Finanz und Wirtschaft, Jan. 22:

According to
macro strategist Felix Zulauf, founder and president of Zulauf Asset
Management and Vicenda Asset Management in Zug, the almost
seven-year-old bull market is

Going Off-Line As Privilege Signaling

Sometimes you have to do a little signaling.




What better way to show you’re too cool to be ‘on’ all the time; that you need space to think great thoughts? 



That, and when you have the machines on, sure as hell somebody's going to try to contact you.
From the Guardian:

How living offline became the new status symbol 

It was a death as intensely private as the mourning was public. David 

Soros: ‘The EU Is on the Verge of Collapse’—An Interview (plus George's stock tips for the current market)

It's always interesting to hear what Mr. Soros has to say.


"Ils ne se servent de la pensée que pour autoriser leurs injustices, et
emploient les paroles que pour déguiser leurs pensées"

—François-Marie Arouet--'Voltaire', Dialogue xiv. Le Chapon et la Poularde (1766).


"Men use thought
only to justify their wrong doings, and employ speech only to conceal
their thoughts"
From the Feb. 11

Kremlin Denies Claims Russia Asked Assad To Step Down Last Year

Ahead of the (apparently delayed) Syrian peace talks the Financial Times' story was a bit of a bombshell this morning.
First up, from The Interpreter:

Live Updates: The Kremlin has denied claims published by the
Financial Times that the late GRU chief, Igor Sergun, had travelled to
Syria to ask, without success, that Bashar al-Assad step aside.

The previous post in our Putin in Syria column

Solar: The Quality Remains Long After The Price Is Forgotten

That's one version of a quote by Henry Royce, he of the Rolls-Royce motorcar.
First Solar is the Roller of solar, period.
Don't get me started on SunEdison.

From Investors Business Daily: 

First Solar, SunPower Gleam On Barclays Report

SolarCity (NASDAQ:SCTY) and Sunrun (NASDAQ:RUN) are prepped for a bare-knuckle slugfest over 2016 installations, but the skies are clear for First Solar (

Handy Hints For Our Soon-to-be-Snowbound East Coast Friends

At least once a year the Eastern seaboard sees a big storm and we try to be helpful.
From the Art of Manliness:

5 Ways to Tie a Scarf: Your 60-Second Visual Guide




Scarves are a great way to stay toasty warm when the winter winds
come biting. But many men don’t know how to tie a scarf in a masculine
and confident way. Using Antonio Centeno’s article from a few years ago, we illustrated 5 of

Natural Gas: EIA Weekly Supply/Demand Report

Right now supply is swamping demand despite natural gas almost topping coal as the power burn fuel of choice.
Front futures $2.139 up 0.001.

From the Energy Information Administration:



In the News:




Consumption of natural gas for power generation at record highs


Since January 1, consumption of natural gas for electric power
generation (power burn) has averaged 26.0

More On China's Cryptocurrency Push and Financial Repression

Following up on yesterday's "You Call That Financial Repression? I'll Show You Financial Repression: Chinese Central Bank Explores Cryptocurrency".

First up, state mouthpiece Xinhua:

China to issue digital currency "as soon as possible"

China's central bank on Wednesday announced that it will try to issue digital currency "as soon as possible."

A team in the central bank is examining

Short The Swiss (and Luxembourg)

Maybe Liechtenstein too. Never much cared for Doha either. And then there's...
errrmmm, excuse me.
From FT Alphaville:

Capital flow reversals and the Swiss

There’s a been recurring phenomenon at the World Economic Forum in
Davos this week. If the global elite have finally found their way to a
particular narrative or viewpoint — this year’s core fascinations being
tech disruption, Europe’s

The Wealthy Have Nowhere To Put Their Money, This Is A Problem

From The Week:

Rich people have nowhere to put their money. This is a serious problem.


So here's a mystery: According to the latest numbers
from the International Monetary Fund (IMF), the world economy grew 3.1
percent in 2015 and is projected to grow 3.4 percent in 2016. On the
world stage, that's a pretty modest rate, but it is growth. And yet at
the same time, financial markets started

Markets Bounding and Rebounding

From Marc to Market:

Collective Sigh of Relief Ahead of the Weekend




Like a car ignition that finally catches after several attempts, the
global markets are building on the recovery seen in North America
yesterday.  



Asian stocks rallied, with the Nikkei leading the
way with a 5.9% rally.  More modest 1.25% gains in Shanghai Composite
allowed Chinese stocks to finish the week with small

Half of Future Oil Output Uneconomic at $60/Barrel--Wood Mackenzie

From WoodMac:

Half of oil production from future developments is uneconomic at
US$60/bbl Brent – this is the conclusion from our comprehensive
breakeven analysis of future global oil developments. These comprise of
conventional projects which have yet to receive final investment
decision (pre-FID) and future drilling in US onshore Lower 48 plays;
which are critical for future oil supply.

Blockchain: "Blythe Masters' Firm Raises Cash, Wins Australian Contract"

Following up on Tuesday's "Blythe Masters' Blockchain Co. Hires In London, Still No Word On Financing". Now we have an answer.
From Bloomberg:

Digital Asset Holdings, the blockchain startup run by former JPMorgan
Chase & Co. banker Blythe Masters, raised $52 million from
investors and won a contract to radically speed up settlement in
Australia’s stock market.

The deal with ASX Ltd.,

You Call That Financial Repression? I'll Show You Financial Repression: Chinese Central Bank Explores Cryptocurrency

From Bloomberg: 

China Mulls Answer to Bitcoin With Digital Currency Study

China’s central bank said it is studying the prospects of issuing its
own digital currency and aiming to roll out a product as soon as
possible, contending that alternative payment systems can improve the
efficiency of global transactions.

The People’s Bank of China set
up a research team in 2014 to study digital

Silicon Valley's $585 Billion Problem

Is the emphasis on the Sili... or on the ...con?

A major piece from Fortune:

VCs have pumped up the value of the “unicorn” startups. Now tech IPOs are in trouble. Good luck getting out.

Of all the Silicon Valley IPOs in the past couple of years, Lending Club’s might have been the surest bet of all.
.
The San Francisco peer-to-peer lender is a star in the world of “fintech,” a growing sector

Davos, The Fourth Industrial Revolution and Robot Journalism

I'm pretty sure half the reports being filed from Davos, what with their regurgitated "Fourth Industrial Revolution" pablum, are written by robots.

Here's someone not in Switzerland, R&D Magazine:

Much attention at the 2016 World Economic Forum has been focused on the Fourth Industrial Revolution. With the proliferation of advanced robotics, autonomous transport, artificial intelligence,

"Natural-gas prices turn lower as U.S. supplies decline less than expected"

Front futures 2.084 -0.034.
From MarketWatch:
Natural-gas futures turned lower on Thursday after the U.S. Energy Information Administration reported that supplies of the commodity declined by 178 billion cubic feet for the week ended Jan. 15. That was less than the fall of between 183 billion cubic feet and 187 billion cubic feet expected by analysts polled by Platts. Total stocks now stand at

"Natural Gas Rises on Expectations for Big Draw from Stockpiles"--UPDATE

Update below.
Original post:

Well (so to speak) it's been six days since "Natural Gas: EIA Weekly Supply/Demand Report (and a long trade for the nimble)" at $2.108 and now, fifteen minutes ahead of the EIA's storage report we're sitting at $2.172 +0.054.; $640 to the good on each $2250 margin, or 28% cash on cash profit.
No pressure.
We've counted the heating degree days and taken the pulse of

Barclays Oil ETN Is Trading at A 40% Premium To Its Benchmark (OIL)

Or, as the writer puts it, "completely unhinged".
From Barron's Focus on Funds:

Barclays Oil ETN is Completely Disconnected from Commodity’s Price

Another oddity has developed in the market for exchange-traded notes.
.
Barclays warned investors this week that the market price of a popular oil-tracking ETN has jumped to a massive premium over the value of the index it’s designed to track. While

Ruble Continues Collapse, Analysts Weigh In

Following up on yesterday's "Russia: Bank of America Has A Scenario With The Ruble At 210 to the Dollar".

In December 2014 there was almost a frenzy among the commentariat regarding the fall of the ruble toward the 60's. This time around there seemed to be an air of resignation despite the move being inexorable since last May at under 50. Go figure.

Here Alphavillein David Keohane rounds up a

Watching Hong Kong And The Derivatives Trigger Of Doom (HSCEI)

The Hong Kong Stock Exchange Hang Seng China Enterprises Index is trading up 90.63 at 8,106.07.

Although we are not big fans of technical analyst Tom DeMark he said something today on Bloomberg that triggered some awareness sensitivity on our part. As quoted at ZeroHedge:





We are pretty confident the next level on the HSCEI is below 7,500.
We think what we're going to see in the HSCEI is

Russia: Bank of America Has A Scenario With The Ruble At 210 to the Dollar

USD/RUB: 81.4709 last. EUR/RUB 88.9471 as of 21:03 ET.
From Fort Russ: 

Bank of America Calculates $210[sic] Ruble Scenario 


If
oil prices fall to $25 per barrel, the budget could be reduced without a
deficit if the dollar is equal to 210 rubles, estimates economists of
Bank of America.




If
oil prices fall to $25 per barrel, for a balanced fulfillment of the
Russian budget for 2016,

Sometimes You Need A Helping Hand

From gCaptain:


The luxury cruise ship Le Boreal was loaded onto the deck of the COSCO Heavy Transport ship HLV Kang Sheng Kou in Punta Arenas, Chile this week about two months after the ship was hit by a major fire in the Southern Atlantic Ocean...MORE
Those heavy lift ships are some of the most amazing things in the world. Here's the biggest, the MV Blue Marlin moving some barges. Via the

"Turkish army establishing military base in Somalia"

Of course they are.
From PressTV:

Ankara has started to build a military base in Somalia to train soldiers from African countries to fight against al-Qaeda-affiliated al-Shabab militants, a report says. 

In a Monday report, Turkish newspaper Daily Sabah cited military sources as saying that based on an agreement between the Turkish and Somali governments, over 1,500 Somali troops will be

Having Avoided a Dow Theory Sell Signal....I'm Getting Too Old for This

From iBankCoin:

Cashin: We Dodged a Bullet

Rumors of derivatives in Hong Kong. Today’s reversal from -566, allowed us to avoid the ominous “Dow Theory sell signal.”.Watch what happens in Asia tonight..Oil’s rebound is what drove today’s rally..Had we broke 1,801 on the SPY, there would’ve been dragons in these lands....MORE

Naming Names: Cash Flow Negative Energy Companies With Big Debt (XLE; XOP)

The proxies we use for 'the industry' are the S&P Energy Sector ETF (XLE) for the integrateds and the SPDR Exploration and Production ETF (XOP) for the smaller guys.

Both set new multi-year lows again today, XOP currently down 5.78% at $22.49 and the XLE at $50.23, down $2.95 (5.55%)

From ZeroHedge:


America's Cash Flow Negative Energy Companies Have $325 Billion In Debt Among Them



With

"ISIS Terrorists Get a Big Pay Cut"---UPDATED

Update below.
Original post:

From the Fiscal Times:

It can’t be easy being a fighter for the terror group ISIS these days, what with some of the world’ most powerful militaries raining bombs and missiles down on you on a daily basis. But until recently, one thing ISIS-allied jihadists could count on was being better paid than the wretched civilians trapped in their so-called caliphate across

Where In the World Is Izabella Kaminska: Conservation of Energy Edition

She's in Switzerland!

And as Switzerland's CERN teaches us, when matter and anti-matter collide the result, due to conservation of mass energy, will be the annihilation of both but with an asymmetry favoring residual matter in the resulting hadron cascade.
Anyhoo, here's one of Ms Kaminska's tweets which you can blame for my ramble:


My new motto. For every good technology affords us, an equal

Here Comes Your 19th Market Meltdown: Gold Miners

Following up on yesterday's "Gold Tout Touts Gold: 'Ripe for ‘Mega Short Squeeze’'".
After setting a new multi-year low yesterday, $12.40, and closing down 61 cents at $12.47, the Market Vectors Gold Miners ETF (GDX) is showing up 31 cents (2.49%) in premarket action.
The junior miner ETF (GDXJ) also set a multi-year low at $17.06 and is in full-blown collapse mode:



FinViz
Feb. futures $

Business Reporters In Asia May Be Starting To Lose It

Down, down, down.
Two from Bloomberg's Haidi Lun:


Another day, another bear for Tokyo. Nikkei -20% from June high. Again. On the upside, I'm getting better at bears. pic.twitter.com/LMGC3nX8qZ
— Haidi Lun 伦海迪 (@HaidiLun) January 20, 2016



*CHINA DEC. TRADING IMPROVEMENT NOT DUE TO FAKE INVOICING: COMMERCE MINISTRY
— Haidi Lun 伦海迪 (@HaidiLun) January 20, 2016

The Shanghai composite actually

"Markets Resume New Year Slide"

Brown Bros. Harriman & Cos. Marc Chandler:


The market meltdown is extending into the third consecutive week. 
Once again, the attempt to stabilize has failed, and bottom pickers have been punished.  





It is easy to line up poor news developments, including IMF cutting world
growth on the same day that the IEA warns of an extended glut in the oil
market, the world's largest mining company

GM Buys Shuttered Uber Competitor, Sidecar

From ars technica:

GM buys Uber rival Sidecar, which shut down in December
Deal comes shortly after $500M investment into Lyft, Uber's last-standing rival.

General Motors has acquired the technology and most of the employees behind the now-defunct ride-hailing startup Sidecar, according to Bloomberg. Sidecar Co-founder and CEO Sunil Paul will apparently not be joining the company, but no

House For Sale Between Florence and Siena: Eight Bedrooms, Views, Previous Owner, Michelangelo

From Handsome Properties Intl.:




HT: Metafilter who write:

Art lovers take note: a sprawling villa once owned by the artist and sculptor Michelangelo Buonarroti is on the market.
And if you have a few million to spare, the masterpiece could be yours.
The eight-bedroom villa, located near Siena, was bought by the
Renaissance master in 1549 and remained in the Buonarroti family until
1867

Why Are Corporate CEOs More Famous In India?

I know that's not the intended takeaway but it's the first thing I saw.
From Quartz:

More than half of people can’t name a single CEO

Pop quiz: Name the first CEO that comes to mind.

If you answered “umm…” or “what’s a CEO?,” don’t fret—you are far from alone. In fact, a new survey
of the general public in 10 large countries found that almost 50% of
people polled say they couldn’t name a

Gold Tout Touts Gold: "Ripe for ‘Mega Short Squeeze’"

The fact that most stands out about gold over the past two months of market turmoil, what with China and oil and equities and ISIS and, well everything, is that it is up less than forty bucks from the multi year low of November-December which was $1049.40 spot:




Kitco
$1087.50 last.
Spot, not futures, spot.
From Barron's Focus on Funds:

Gold Prices Ripe for ‘Mega Short Squeeze,’ Fund Manager

So These Eight ISIS Wives Walk Into Raqqa HQ and Lift Their Burkas...

Gotta be the feel good story of the week.
On so many levels.
From The Sun:

Burka-clad SAS soldiers take out ISIS kingpin in daring Syria mission
They hid assault weapons, grenades and ammunition under their clothes

A CRACK team of commandos disguised themselves by wearing burkas for a daring attack on an Islamic State base. 

The SAS squad wore the female Islamic clothing to pose as the wives

#2 Natural Gas Producer Chesapeake Energy Down 15% on Talk of Death, Dismemberment (CHK)

From FinViz:



To quote an analyst I once knew: "A trend appears to be emerging".

There's no news at the moment but if I had to guess I'd say the debt swap they need to complete to avoid bankruptcy may have hit a snag.

More to come, I'm sure. In the meantime that's at least a 14-15-year low.
$3.02 down 54 cents last.

Goldman Calls For Oil Rally, Makes Rookie Mistake

But Goldman doesn't make mistakes.
So why do they violate the first rule of public pronouncements, namely if you give a price, don't never ever give a date.
(I violate the rule on a regular basis but that's a different story)

From Barron's Getting Technical column:

Goldman Expects Oil Rally; Sees Prices Popping Soon

Sentiment is at negative extremes, the bank’s derivative strategists say, a

Italy Appears To Be Getting Sick of Germany, Brussels Despite Junker Love

Damn near a Bloomberg headline!

I was told this morning that the €3 billion that Turkey talked the Germans into committing the EU to had not been wired.
Wha?

First up, The Independent, Sunday Jan. 17:

Italy 'preparing to cause trouble' for EU as relations with Germany sour 

Rome says it will no longer be intimidated by 'soundbites' from Berlin...MORE
Hmmm, let's dig a little deeper.

ANSA on