Category: Aggregated

Russian Foreign Minister Sergey Lavrov and Secretary of State Rex Tillerson held an hour-long informal meeting at the Russian United Nations Mission in New York. They reiterated their commitment to cooperate in Syria to eliminate conflict situations and reduction of violence, according to a statement by State Department spokesperson Heather Nauert.

“The two recommitted to deconflicting military operations in Syria, reducing the violence, and creating the conditions for the Geneva process to move forward, pursuant to United Nations Security Council Resolution 2254,” according to the document.

The Russian Foreign Ministry reported that they also discussed cooperation on the Syrian crisis and other aspects of the situation in the Middle East and North Africa as well as the status of implementation of the Minsk agreements.

Russian Senator Konstantin Kosachev said today that the meeting was a positive signal. “I see a positive signal in today’s meeting,” said Kosachev, who chairs Russia’s Federation Council (upper house of parliament) International Affairs Committee. “No doubt, the two countries, which are permanent UN Security Council members, should coordinate their steps ahead of the upcoming General Assembly. This is a good sign,” he said.

Nonetheless, Kosachev said it was unfortunate that in a interview with Face the Nation on CBS, Tillerson said that “if our diplomatic efforts (on North Korea) fall though, our military option will be the only one left.” Kosachev didn’t mention the fact that both U.S. Ambassador to the UN Nikki Haley and National Security Advisor H.R. McMaster issued similar threats of military action, speaking on Sunday talk shows.

“As long as the U.S. and other Western countries, their allies and neighbors of North Korea — South Korea, Japan and other regional countries— leave open the possibility of external interference and toppling the current regime there, unfortunately North Korea and its authorities will continue implementing its nuclear program,” Kosachev warned.

“Definitely, there is no military solution there, no doubt that if any military operation is carried out, unfortunately, North Korea’s authorities will fulfill those possibilities that they have,” the Russian Senator stressed. “All this will end sadly not only for the region but for the whole world, including the US.”

“That’s why I sincerely regret Tillerson’s statement as this is definitely not a solution to the North Korean problem, recognizing that this is a problem, it is evident that it exists and demands immediate solution,” the senator said.

Russian Foreign Minister Sergey Lavrov and Secretary of State Rex Tillerson held an hour-long informal meeting at the Russian United Nations Mission in New York. They reiterated their commitment to cooperate in Syria to eliminate conflict situations and reduction of violence, according to a statement by State Department spokesperson Heather Nauert.

“The two recommitted to deconflicting military operations in Syria, reducing the violence, and creating the conditions for the Geneva process to move forward, pursuant to United Nations Security Council Resolution 2254,” according to the document.

The Russian Foreign Ministry reported that they also discussed cooperation on the Syrian crisis and other aspects of the situation in the Middle East and North Africa as well as the status of implementation of the Minsk agreements.

Russian Senator Konstantin Kosachev said today that the meeting was a positive signal. “I see a positive signal in today’s meeting,” said Kosachev, who chairs Russia’s Federation Council (upper house of parliament) International Affairs Committee. “No doubt, the two countries, which are permanent UN Security Council members, should coordinate their steps ahead of the upcoming General Assembly. This is a good sign,” he said.

Nonetheless, Kosachev said it was unfortunate that in a interview with Face the Nation on CBS, Tillerson said that “if our diplomatic efforts (on North Korea) fall though, our military option will be the only one left.” Kosachev didn’t mention the fact that both U.S. Ambassador to the UN Nikki Haley and National Security Advisor H.R. McMaster issued similar threats of military action, speaking on Sunday talk shows.

“As long as the U.S. and other Western countries, their allies and neighbors of North Korea — South Korea, Japan and other regional countries— leave open the possibility of external interference and toppling the current regime there, unfortunately North Korea and its authorities will continue implementing its nuclear program,” Kosachev warned.

“Definitely, there is no military solution there, no doubt that if any military operation is carried out, unfortunately, North Korea’s authorities will fulfill those possibilities that they have,” the Russian Senator stressed. “All this will end sadly not only for the region but for the whole world, including the US.”

“That’s why I sincerely regret Tillerson’s statement as this is definitely not a solution to the North Korean problem, recognizing that this is a problem, it is evident that it exists and demands immediate solution,” the senator said.

Following the report of the UK-based Adam Smith Institute last week that City of London banks were more overleveraged than in 2007 and “an accident waiting to happen,” two new warnings emerged today of the bigger crash threat from the U.S. and European corporate bond markets.

Deutsche Bank chief credit strategist followed up CEO John Cryan’s remarks last week that the central banks had created “bubbles everywhere,” with a warning that “asset prices globally are the most elevated in history.” This history involved is since 1800, and the measures complicated. But the bank is clearly reporting that the credit, or bond markets, are closer than ever before to the highest global average price possible, meaning the lowest global average interest rate possible. Their report says “While they remain this high there is always a risk of a sudden correction that could be destabilising to a financial system and global economy that seems to require such elevated asset prices.”

The report also points to the epidemic in Europe and the United States of bond issues with “lite” or no covenants, meaning the company’s ability to repay cannot be judged. A homey example is given by Jared Kushner’s family real estate company, which owes billions in loans on which it has lacked the revenue even to pay interest.

The latest quarterly report of the Bank for International Settlements contains a warning about a potential corporate debt crisis or collapse. It estimates that 10% of all European non-financial firms are “zombie companies” which have become completely dependent on borrowing at near-zero interest rates, and will go bankrupt with any significant rate rise. They estimate that the ratio in the U.S. corporate sector is 16% “zombies.” Recall that the IMF 2017 global review three months earlier estimated that 20% or more of U.S. non-financial firms would “default” with any significant rate rise, not necessarily the same as going bankrupt; so this is an equally serious warning. “Ultra-low rates have allowed these companies to keep operating…. “In the event of a slowdown or an upward adjustment in interest rates, high debt service payments and default risk could pose challenges to corporates, and thereby create headwinds for GDP growth.”

BIS says investors still think the central banks will return to quantitative easing as soon as any market quakes. “This underlines just how much asset prices appear to depend on the very low bond yields that have prevailed for so long.”

This week the Fed is deciding whether to start selling assets, pushing interest rates up if it announces that. 

Following the report of the UK-based Adam Smith Institute last week that City of London banks were more overleveraged than in 2007 and “an accident waiting to happen,” two new warnings emerged today of the bigger crash threat from the U.S. and European corporate bond markets.

Deutsche Bank chief credit strategist followed up CEO John Cryan’s remarks last week that the central banks had created “bubbles everywhere,” with a warning that “asset prices globally are the most elevated in history.” This history involved is since 1800, and the measures complicated. But the bank is clearly reporting that the credit, or bond markets, are closer than ever before to the highest global average price possible, meaning the lowest global average interest rate possible. Their report says “While they remain this high there is always a risk of a sudden correction that could be destabilising to a financial system and global economy that seems to require such elevated asset prices.”

The report also points to the epidemic in Europe and the United States of bond issues with “lite” or no covenants, meaning the company’s ability to repay cannot be judged. A homey example is given by Jared Kushner’s family real estate company, which owes billions in loans on which it has lacked the revenue even to pay interest.

The latest quarterly report of the Bank for International Settlements contains a warning about a potential corporate debt crisis or collapse. It estimates that 10% of all European non-financial firms are “zombie companies” which have become completely dependent on borrowing at near-zero interest rates, and will go bankrupt with any significant rate rise. They estimate that the ratio in the U.S. corporate sector is 16% “zombies.” Recall that the IMF 2017 global review three months earlier estimated that 20% or more of U.S. non-financial firms would “default” with any significant rate rise, not necessarily the same as going bankrupt; so this is an equally serious warning. “Ultra-low rates have allowed these companies to keep operating…. “In the event of a slowdown or an upward adjustment in interest rates, high debt service payments and default risk could pose challenges to corporates, and thereby create headwinds for GDP growth.”

BIS says investors still think the central banks will return to quantitative easing as soon as any market quakes. “This underlines just how much asset prices appear to depend on the very low bond yields that have prevailed for so long.”

This week the Fed is deciding whether to start selling assets, pushing interest rates up if it announces that.