Orchestration and negotiation are my two words of the day today. Oh, and let me throw in cold as kind of a bonus word …
The Iran situation is heating up, and this is not good news for the market. All we need is another late winter, such as we had last year – the Japanese earthquake and tsunami, the Arab Spring, and the Libyan revolution. Those events disrupted the global supply chain and pressured oil prices, which pressured food prices, which then knocked a resurgent economy back on its heels.
Iran will target any country used as a launch pad for attacks against its soil, the deputy Revolutionary Guards commander said, expanding Tehran’s range of threats in an increasingly volatile standoff with world powers over its nuclear ambitions.
Now, this orchestration of a dangerous military dance threatens to do the same. As a market player, this concerns me greatly and I hope that Israel’s threats to attack Iran, and the mounting pressure for the U.S. to attack Iran, does not force the Obama Administration’s hand. It seems he understands the ramifications of such a move, and with the increased sanctions, it is possible Iran and Israel will stand down. Man-oh-man, wouldn’t it be nice if the market could catch a break this spring?
Any kind of additional military activity inside the Gulf is disruptive and has a big effect on us. It could have a big effect on oil prices …
The ongoing negotiations to get the Greeks the next tranche of their bailout package continues, and now the labor unions are under the spotlight.
Greece’s two major labor unions planned a 24-hour strike against austerity measures and reforms demanded by international lenders in exchange for a new bailout package.
By my count, negotiations are occurring with the private and public creditors, the “troika” consisting of the European Commission (EC), the International Monetary Fund (IMF), and the European Central Bank (ECB), the labor unions in Greece, and now the heads of the three opposition parties, who are mightily resisting deeper cuts in pay and pensions. Day by day, the Greek picture seems to worsen, but, as you might expect, this addled brain of mine still believes that the fundamental element of all the negotiation going on is for each of the players to maximize concessions for its side. In the end, it is inconceivable that any one or all would scuttle any deal because that means all will lose, and lose really big.
So, this leaves me with the word “cold.”
Bitterly cold weather sweeping across Europe claimed more victims Sunday, brought widespread disruption to transport services, and left thousands without power with warnings that low temperatures would continue into next week.
This is a personal tragedy, and it adds to the sad story of Europe these days. Furthermore, it is one more blow to an economy that is reeling from a serious lack of confidence. Some days, it easy to see how those with a negative orientation support their views. Yes, and some days, it is really hard to be me …
Trade in the day – Invest in your life …
