Putin has achieved his main objectives. He gets to keep Crimea, even if Russia’s annexation is never legally recognized (think Israel and East Jerusalem). He ensures that Ukraine joining NATO or the EU is out of the question for the foreseeable future. He shows that former-Soviet countries that openly defy Russia will suffer severe punishment, so deterring others such as Georgia and Azerbaijan from flirting with the EU and NATO. He reveals, yet again, that NATO and the US are what Mao Zedong used to call ‘paper tigers’. And he shows that any popular uprising against his regime in Moscow would be ruthlessly crushed. He thereby reinforces his political invulnerability and even his popularity within Russia.
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REASONS RUSSIA OUTCOME IS BEST CASE SCENARIO Russia is a
dictatorship and doesnt need approval The U.S. and Europe were
clear from the beginning they would not defend Ukraine militarily
The cease-fire amounts to a partition of Ukraine but leaves Ukraine
with a lot of sovereign territory Ukraine knows it would be
destroyed with no sovereignty in an actual fight with Russia.
Russia proved Eastern European countries cannot depend on U.S./NATO
to defend them Putin got his East Ukraine land bridge to Crimea
Putin has Crimea as a warm water port allowing him to supply
weapons to anyone via sea. SETTLEMENT MORE STABLE THAN GENERALLY
THOUGHT. AGREEMENT CAN ENDURE BECAUSE EVERYONE GOT WHAT THEY WANT
The Ukrainian government shows it made a HEROIC goal line stand.
Obama weakened the U.S. as he wanted to Russia got its warm water
port and more territory to control Ukraine got to survive as a
apparently sovereign country Putin has achieved his main
objectives. He gets to keep Crimea, even if Russias annexation is
never legally recognized (think Israel and East Jerusalem). He
ensures that Ukraine joining NATO or the EU is out of the question
for the foreseeable future. He shows that former-Soviet countries
that openly defy Russia will suffer severe punishment, so deterring
others such as Georgia and Azerbaijan from flirting with the EU and
NATO. He reveals, yet again, that NATO and the US are what Mao
Zedong used to call paper tigers. And he shows that any popular
uprising against his regime in Moscow would be ruthlessly crushed.
He thereby reinforces his political invulnerability and even his
popularity within Russia. QQQ vs. IWM The all-issues Adv-Dec Line
has been in a steady climb, setting a new high for the bull market
on Sept. 2nd. This performance outpaces the gains in the NY Comp.
Index, which set its most recent bull market high on July 3rd.
However, the performance of the all-issues Adv-Dec Line has been
boosted by gains in the many non-operating company issues traded on
the NYSE, such as closed end bond funds and preferred stocks, which
continue to benefit from the very low interest rate environment. In
addition, these issues tend to be illiquid and carry small
capitalizations. Thus, they have a larger influence on an Adv- Dec
Line than on a capitalization weighted price index. That is, a
1-penny rise puts an issue in the advance column of the Adv-Dec
Line but contributes little to price gains in the NY Comp. Index. 1
year advance/decline line everyone sees NYSE Advance/Decline line
without bond funds and foreign stocks. This is the first failure.
Remember the S&P 500 and the QQQ are at new bull market highs
as of 9/5/14 1 pm Tuesday rally day not a break out Qqq not a
change in trend Early August led to rally. The 1.75 level. Clean
out Monday. The point on the ratio is 175, when the big
long-lasting rallies start. That level requires a much bigger
sell-off that the market has been able to sustain this spring and
summer.. The 1.75 level. Clean out 8/ Back in August this was how
we called the start of the rally -- Spx 1920/ Rut = 1.706 Today Wed
evening 9/18/14 9/18/14 Inflection Point. Cant tell where it goes
next, but this will help read the XRAY! Hope for break-down, and
could cross briefly and suck technicians in. Anchoring is automatic
trained seal response Change of character? Another way of looking
at it. Monday 9.30 am Tuesday morning. WEDNESDAY Evening. How
quickly they forget! 1 pm Tuesday rally day not a break out Tuesday
1 pm QQQ not a change in trend Wednesday Evening no help yet on
Russel Wed evening- selling running out of gas just as Russel:SPY
becoming oversold again. Remember why it didnt last! Effective Use
of Leverage = Effective Management of Resources. Bonds do not stop
you from owning stocks The question is what happens to the money
when you are less than all in. How often is your level of certainty
high enough for 100% of possible allocation? John Mauldin,
Best-Selling author and recognized financial expert, is also editor
of the free Thoughts From the Frontline that goes to over 1 million
readers each week. For more information on John or his FREE weekly
economic letter go to:
