christmas

29-30 December: Greek Parliment Fire; AirAsia Shares Plunge As Flight Vanishes

29-30 December: Greek Parliment Fire; AirAsia Shares Plunge As Flight Vanishes

In what has to be the most heart wrenching year in modern civil aviation history, another civilian airplane has vanished without a trace over an area spanning between Indonesia and Borneo.

Earlier this year in March, Malaysian Airlines Flight MH370 flying from Kuala Lumpur, Malaysia to Beijing, China lost radio contact with Malaysian ATC while flying over the South China Sea towards Vietnam. Almost 9 months after its mysterious disappearance, the Boeing 777-200ER airplane that serviced MH370 is still not found, nor have parts that belonged to the aircraft been found despite extensive international search efforts across millions of square miles over the Indian Ocean. The conclusion of MH370 is still open ended, but consensus is that it has crashed in open waters West of Australia. MH370 was carrying 239 passengers in total, the world has never heard from them since.

The flight in question is QZ8501 operated by an affiliate of AirAsia, AirAsia Indonesia whose parent company is PT Fersindo Nusaperkasa. The firm was founded in December 2004 under the brand "Awair". As we go to print, the airplane is still missing after 48 hours since it broke contact with Jakarta ATC. No distress signal was given.

23-28 December: Record Highs on Santa Rally; Russia Say Ruble Crisis Over; Japanese Prices Slip Yet Lower

23-28 December: Record Highs on Santa Rally; Russia Say Ruble Crisis Over; Japanese Prices Slip Yet Lower

The S&P 500 index closed at a record high of 2083 at Friday's close, capping what has been an ebullient Christmas week where equities have historically enjoyed outsized returns relative to volatility. Indeed, the S&P 500 was joined by the Russell 2000 index of stocks and the DJIA (Dow Jones Industrial Average of 30 stocks) to close Friday at their respective record highs.

Trading volumes have been thin across the board, perhaps not so in China where people apparently are told not to celebrate the festivities of Christmas, as markets there remained opened for the entire week. Apart from American markets, the Shanghai Composite surged to a record high this past week. Reason? Mainstream media has been blaring more stimuli from the PBoC. If indeed true, that the PBoC is indeed gearing up for more stimulus come 2015, it would indeed be trying to balance a very tricky scale. Readers will recall that earlier in December, the PBoC reigned in on shadow banking by tightening collateral rules; and now wants to prop up asset prices by introducing more stimulus via other conduits? Seems like some central bankers over there are a little confused on what they actually wish to achieve with their Schrödinger policies.

19-22 December: Reeling From Russia's Pain, Belarus Implodes; Global Markets Rebound Sharply; Sony Hacking Satire

19-22 December: Reeling From Russia's Pain, Belarus Implodes; Global Markets Rebound Sharply; Sony Hacking Satire

The overnight night unsecured deposit rate on BYR has exploded north of 30% as the national bank has made it too expensive to lend BYR even amongst banks. As we learned from the bank's press release, it wants to halt sales of BYR by as much as possible though pseudo and conventional capital controls. The interest on commercial and retail deposits at local banks has also spiked to encourage individuals and businesses to leave their currency in their banks. Apparently enough, we know this is not working one bit and the run on banks continues and will probably extend all the way to Christmas Eve before there is any easing of tensions.

Indeed, just a few hours after AFP broke this news, the overnight interbank BYR deposit rate has surged past 50% as the fire intensifies.