The U.S., Europe, and Russia continue to play their pieces on the chessboard of Ukraine. Russia wants a territorial land buffer between the Russian heartland and the U.S. via NATO. The U.S. and Europe don't want to give Putin that concession. It does seem that Russia may be interested in honoring a cease-fire for now. EU sanctions are up for review in March and the Russian economy could use a break. It also doesn't hurt that the U.S. has threatened to deliver weapons to Ukraine. This is another chess piece on a crowded and complicated game board. In the end, the situation is still a mess and very much up in the air.
On the Greek front, the Eurozone's finance ministers accepted the economic reforms proposed by Greece that gives the four-month extension of Greece's bailout program the green light. Many in Greece are unhappy with the deal and another major standoff in 3-4 months should be expected.
I appreciated this commentary on how all of these global crises intersect with each other:
"Germany needs a deal with Russia to be able to manage an existential crisis for the eurozone; Russia needs a deal with the United States to limit U.S. encroachment on its sphere of influence; and the United States needs a deal with Iran to refocus its attention on Russia. No conflict is divorced from the other, though each may be of a different scale. Germany and Russia can find ways to settle their differences, as can Iran and the United States. But a prolonged eurozone crisis cannot be avoided, nor can a deep Russian mistrust of U.S. intentions for its periphery.
Both issues bring the United States back to Eurasia. A distracted Germany will compel the United States to go beyond NATO boundaries to encircle Russia. Rest assured, Russia - even under severe economic stress - will find the means to respond." - The Intersection of Three Crises is republished with permission of Stratfor.
In other news, the Dow and S&P 500 both hit all-time records this week. Fed Chair Janet Yellen increasingly seems open to increasing interest rates. I believe Yellen is very open to releasing some air from the expanding balloon that is the U.S. stock market. Perhaps we will see a .25% increase in rates this summer sometime. We shall see.
The YELLOW ALERT continues to be in effect, and likely will continue to be. Be smart out there. I am maintaining large cash positions.
Let me know if you have any questions or if I can help in any way.
Disclosure: No positions.
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