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Will China’s Economic Collapse Force A Revolutionary Change?

There is no question that China is in a heap of economic trouble. From massive credit bubble to empty cities, from shadow banking to slowing growth. We have covered it in great detail on this blog over the last couple of months. Plus, there are signs the Chinese bubble economy is starting to unwind with Hang Seng index plunging into an official bear market territory just a few days ago. My question is….

Will the Chinese crisis/collapse be severe enough to force a revolutionary change in China? 

Perhaps some of my Chinese readers can comment on the subject matter. What will happen when the Chinese economy slows down significantly, real estate collapses and tens of millions of Chinese families lose everything? I, for one, believe China might experience a violent (revolutionary) type of a governmental change. While today’s China illuminates the strength of its government, should the financial crisis be severe enough, the change might come faster/sooner than most people believe.  

What do you guys think? 

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Will China’s Economic Collapse Force A Revolutionary Change? Google

ChinasHouseofCards

The Daily Ticker: China heading toward a debt crisis with global ramifications: Banking vet

China’s economic engine appears to be contracting, or at least slowing. Chinese PMI fell to 48.1 in March, an eight-month low, and the index has been below 50 since January. A PMI below 50 indiates a contraction in the manufacturing sector.

Last year Suntech Power, a Chinese solar energy company, defaulted on a $541 million bond followed by Shanghai Chaori Solar failing to make a $14.7 million interest payment on March 7. On March 18, Zhejiang Xingrun Real Estate Company defaulted on a $400 million loan. China is also taking large (and potentially unsustainable) debts in emerging markets prompting investor concern. China’s hard currency debt exposure was $223 billion at the end of 2013, according to Nomura Securities

“China has significantly over-billed and created a significant amount of bad debt,” says Richard Vague, managing partner of Gabriel Investments. “They’ve grown private debt 56% in five years and their private debt levels are 180% or perhaps more.”

So is China looking at a 2008-style crisis with global ramifications?

“It looks to us like at least $2 trillion to 3 trillion in bad loans or suboptimal loans have been created so it’s not a small problem relative to their GDP, or the capital of the banks,” says Vague. But they have the capacity to rein in the problem, “both in terms of the reserves they have and they have capacity in terms of additional borrowing at the central government level.”

Still, says Vague, “It’s going to take no less than a concurrent effort to go in and recapitalize institutions and extend the safety net.”

The best case for China going forward? Significantly lower growth levels, says Vague. And worst case? A banking crisis where things contract and hit the global economy.

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Attention: Tech Stocks About To Surge?

With King Digital going public and Facebook’s $2 Billion acquisition, The Daily Ticker asks “Are we on the verge of another tech bubble?”

Idiots. 

On “the verge” implies that today’s valuation are normal and we are about to experience a huge run up, leading to an eventual “bubble”. We are in a massive bubble already. Today. Thanks to the FED and their monetary policy or lack thereof. The valuations are at astronomical levels and today’s active IPO market is a clear indication of that. Further, with our mathematical and timing work clearly predicting a severe bear market and a US recession between 2014-2017, the bubble is about to POP.  

Dumb and Dumber (Screengrab)

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Attention: Tech Stocks About To Surge?  Google

Daily Ticker Are we on the verge of another tech bubble?

Shares of King Digital Entertainment (KING), the mobile game maker of the popular Candy Crush, started  trading today for the very first time but below an IPO price of $22.50 a share which valued the company at  $7.1 billion. In early trading shares were down about 8% at $20.70.

Facebook (FB) announced it’s buying virtual reality firm Oculus VR for $2 billion--$400 million in cash plus stock–just five weeks after it announced a $19 billion acquisition of WhatsApp. Oculus makes virtual reality goggles used to play video games, but Facebook CEO Mark Zuckerberg said Tuesday he plans to expand its platform to include education, medicine and more.

Finally, Box Inc., a cloud storage company, announced Monday plans to raise $250 million through an IPO.Unlike King Digital, which had profits of more than half a billion dollars last year, Box has been operating at a growing deficit despite increasing revenues.

Could we be on the verge of another tech bubble?

“Don’t insult the real bubble of the 1990s,” says Henry Blodget, though he admits “some valuations are breathtaking,” like King’s. Its “numbers are already shrinking,” says Blodget. “I don’t know anyone who plays Candy Crush anymore.”

There are no current numbers for Oculus. Its virtual reality headset is available only as a prototype for developers and not for sale to consumers. “This is as speculative as you can get,” says Blodget. This acquisition is unlike Facebook’s other recent buys: $1 billion for Instagram, a company with 100 million users and $19 billion for WhatsApp with 450 million users (growing at a rate of 1 million users a day).

Most people have never used the Oculus virtual reality headset but those “who have tried it say it’s mind-blowing,” says Blodget. Still, he warns, “there’s a very good chance that this thing is worth zero in two years.”

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Bullish Nasdaq Delusion

Most market participants see Nasdaq and IBB distribution over the last 7 days as nothing more than another buying opportunity. Case and point, Chad Morganlander of Stifel’s Washington Crossing Advisors. He isn’t worried, according to him….. 

  • “The P/E (price-to-earnings) multiple for 2014 on the NASDAQ 100 is roughly about 18 times, that’s going off a growth trajectory of earnings of roughly about 17% and revenue growth expectations of roughly 7%. So, this slice of the market, the NASDAQ 100, has the get-up-and-go that justifies the valuation.”
  •  “We think Cisco, Oracle, and Microsoft with those companies, you see consistent earnings growth,”
  • “You see balance sheets that have a tremendous amount of cash with very little debt. And, also, they have this viability to them that we believe in the coming years will make the markets go higher.”

Big mistake Chad.  You can put your “fundamental” blinders on, but you cannot escape the reality of what is to come over the next few months/years. As a “value oriented fundamental analyst” I thought I would never say this, but in today’s market, fundamentals are irrelevant. They have been distorted by the FED’s credit infusion and cannot be considered valid. Instead, one should concentrate on technical analysis to try and ascertain the future. What technical analysis indicates for the NASDAQ is not good by any measure. 

Yet, you can go even further. As our mathematical and timing work (much more advanced than technical analysis) indicates, the bear market of 2014-2017 is just around the corner. When it starts it will slam the Nasdaq harder than most other indices. If you would like to find out exactly when the bear market will start (to the day) and it’s internal composition, please Click Here.    

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Bullish Nasdaq Delusion  Google

Talking Numbers Writes: This could spell trouble for the tech rally

Some big names in the tech-heavy NASDAQ Composite index are getting smacked around this month.

The hits are being felt by a wide-range of NASDAQ companies. There are the upstarts like Netflix, which lost 17% since the start of March, and Tesla, which is down 10% this month. And there are the Internet giants like Facebook (down 5%) and Google (down 4%). And, the ETF tracking NASDAQ’s biotech companies, the IBB, is down 10% this month as well.

Portfolio manager Chad Morganlander of Stifel’s Washington Crossing Advisors isn’t worried about this month’s decline many of the NASDAQ’s large cap stocks mega cap stocks.

“The P/E (price-to-earnings) multiple for 2014 on the NASDAQ 100 is roughly about 18 times,” says Morganlander about the index of the largest 100 non-financial NASDAQ stocks. “That’s going off a growth trajectory of earnings of roughly about 17% and revenue growth expectations of roughly 7%. So, this slice of the market, the NASDAQ 100, has the get-up-and-go that justifies the valuation.”

Morganlander is particularly optimistic about companies large cap NASDAQ companies like Cisco, Oracle, and Microsoft. “We think with those companies, you see consistent earnings growth,” says Morganlander.

“You see balance sheets that have a tremendous amount of cash with very little debt. And, also, they have this viability to them that we believe in the coming years will make the markets go higher.”

Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson, believes the technicals are more pessimistic than Morganlander’s fundamental analysis.

Ross sees the fund that tracks the NASDAQ, the PowerShares QQQ, as having traded in an upward-sloping trend channel for the past nine months, with the 100-day moving average serving as its support. However, the QQQ recently showed a rounded top pattern.

“That’s a sign of distribution,” says Ross. “When that distribution comes at the tail-end of a five-year bull market, you want to look out here.”

The QQQ closed at $88.51 on Tuesday. According to Ross, a break below the 100-day moving average, currently at $86.79, means the next support level is at the 200-day moving average, now at $81.55. 

“That’s a significant move down and it could come in a hurry,” says Ross

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Shocking Truth: Why The US Chose The Wrong Side In Ukraine/Russia Conflict

Final piece evidence showing that President Obama picked the wrong side in Ukraine/Russia conflict was released on Tuesday.  In it, Ukrainian national security service has put Crimea’s new super hot chief prosecutor Natalia Poklonskaya on its wanted list for unspeakable crimes against Ukraine (see article below). Realizing his mistake President Obama dialed up Putin saying “Sorry bro, I didn’t realize Ukrainians were that crazy”. All was good in the world thereafter.   

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Shocking Truth: Why The US Chose The Wrong Side In Ukraine/Russia Conflict  Google

RT Writes: Crimean chief prosecutor Natalia Poklonskaya ‘wanted’ by Ukraine’s security service

Ukrainian national security service has put Crimea’s chief prosecutor Natalia Poklonskaya on its wanted list. She is charged of taking actions aimed at the violent overthrow of constitutional order and takeover of government power.

Poklonskaya took the office as Crimea defied the coup-imposed government in Kiev and sought independence from Ukraine. After the peninsula joined the Russian Federation, she was appointed as Crimea’s acting chief prosecutor by Russia’s General Prosecutor Yury Chaika.

The Ukrainian National Service for Security and Defense accuse her of violating article 109 of the Criminal Code, which deals with overthrow of the government.

Poklonskaya became somewhat of an internet sensation due you relative youth, attractive appearance and emotional media conferences. A number of anime-style drawings of the official are currency circulation on the web, with many supporters calling her ‘kawaii prosecutor’ after the Japanese term for cuteness.

The now-wanted in Ukraine officer of the law is somewhat irritated with her web popularity, she told the media, because it undermines the serious nature of her job.

Last week the Ukrainian security service said it was investigating 22 alleged cases under Article 109. Seven of the alleged ‘separatists’, as Kiev calls them, are under arrest. Among those charged are several leaders of protests in eastern Ukraine, which defied the new authorities.

 

Image from reddit.com

Image from reddit.com

 

 

Image from reddit.com

Image from reddit.com

 

 

Image from reddit.com

Image from reddit.com

 

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Jim Cramer’s Perfect Timing

Last week Jim Cramer said Tesla (TSLA) is the next Apple (AAPL) and issued a buy recommendation. Tesla’s stock promptly went on to lose 8% of its value. Today, Jim is raving about the “undervalued” Blue Chips. Why? Well, because the Dow didn’t sell off last Friday and Monday as Jim’s favorite Nasdaq and IBB did. Duh!!!!

Is Jim right? Does it mean Blue Chips are undervalued? Hell NO. Market action over the last few days is indicative of complex market top formation. It has nothing to do with undervaluation or overvaluation. As I have said so many times before, the bear market of 2014-2017 is just around the corner. The market action and divergences you are seeing today are a clear indication of that. Point being, there is no value left and I would caution you against buying anything. Let alone what Jim suggests. 

If you would like to know exactly when the bear market will start (to the day) and it’s internal composition, please Click Here. 

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Jim Cramer’s Perfect Timing  Google

CNBC Writes:  Cramer: Are these stocks too darn cheap?

Jim Cramer has noticed a remarkable transformation in the market over the last few days. Investors are buying value.

That is, money is going to work in stocks that investors believe are, essentially, too cheap, if the economy is improving.

And in a market that’s been hyper-focused on growth, the “Mad Money” host thinks the shift is remarkable.

“I think this value move may have some real legs,” Cramer said. “The stocks that are attracting buyers are so much cheaper than the average equity that they could rally for days without running into any kind of ceiling.”

What’s likely to rally as value investors snap up bargains? The following stocks were on Jim Cramer’s radar Tuesday March 25, 2014.

Adam Jeffery | CNBC

Caterpillar

Looking at the valuation Cramer said there’s no doubt Caterpillar is cheap relative to the market. “Right now, CAT’s trading at about 14 times earnings estimates. That’s much cheaper than the S&P 500, trading at 17.2 times earnings,” Cramer explained.

Of course, the discount exists for a reason. Caterpillar had been facing serious business challenges. However, Cramer thinks the company’s fortunes may be about to turn. “We know from talking with United Rentals CEO Mike Kneeland that there’s a renaissance in optimism about commercial construction. That’s CAT’s bread and butter. Also, the Fed has suggested the economy is improving. Again, that’s right in Caterpillar’s wheelhouse. And I’m hearing about a revival in trucking. Caterpillar makes engines; they benefit from any kind of rebound in trucking.”

Johnson & Johnson

Like CAT, Johnson & Johnson is trading at a discount to the average stock in the S&P. “Value buyers think that disparity can’t last,” Cramer said. “J&J is the fastest growing major drug company with the best balance sheet of any company in the United States. And CEO Alex Gorsky has talked openly about shaking the company up which should unlock value. Is this the kind of company deserves to trade at a discount to the rest of the market? According to value investors the answer is a resounding ‘no.’ Shares closed more than 2% higher on Tuesday.

IBM

Although Cramer concedes that IBM missed the last quarter, he thinks the relative discount is too substantial given the transformation underway at the company. “It sells for ten times earnings,” he said.

“IBM is rapidly transitioning to the cloud. It’s much more of a software than a hardware play. At ten times earnings with a new cycle coming, it appears value investors just can’t pass up this bargain.”

Microsoft

Microsoft trades at 14 times earnings and yields almost 3% but Cramer thinks value investors could easily send shares higher. “I think the company’s new CEO, Satya Nadella, will usher in a new era of glasnost, where everything is on the table. No sacred cows.” Therefore, at $40, it’s a value.

Schlumberger

“Schlumberger is the finest oil service firm in the world with the best technology and the best minds,” Cramer added. However it had been trading at a discount to the S&P.

“That ended today when the company spoke at that Howard Weil conference and gave a tremendous outlook,” Cramer explained. The company’s comments suggested the energy renaissance underway in this country was still in early stages and Schlumberger was positioned to profit as developments unfolded.

Although the stock is no longer cheaper than the S&P average, give the catalysts, Cramer thinks value investors will continue to view it as a bargain.

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Warning: Facebook Destroys The Future Of Dating

Last night Facebook announced it’s acquisition of Oculus, a virtual-reality headset maker for $2 Billion. Sure, Facebook has, once again, overpaid wildly for a company with little or no revenue. Yes, all of these overpriced acquisitions will soon catch up to Facebook and take it’s stock price much lower in the upcoming bear market of 2014-2017. To close the gap at around $25. Yet, that is not my primary concern. This is……Thanks a lot Zuckerberg!!!!

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Warning: Facebook Destroys The Future Of Dating Google

Bloomberg Reports: Facebook Bets $2 Billion That Oculus Virtual-Reality Headset Will Be Center of Social Life

Facebook Inc. is making a $2 billion bet that a virtual-reality headset will one day become the center of its users’ social lives.

The largest social network yesterday said it is buying Oculus VR Inc., pushing into wearable hardware for the first time and stepping into a race with Google Inc. Irvine, California-based Oculus makes a ski-goggles-like device called Rift, now used for playing games, that eventually could immerse people in experiences like classes and sport events.

Facebook Chief Executive Officer Mark Zuckerberg is following Google in seeking growth beyond smartphones and tablets. While Apple Inc.’s iPhone and Google’s Android mobile devices dominate today, developers are looking for new gadgets to showcase wares and are focusing on the more lifelike experiences that Oculus provides, Zuckerberg said in a blog.

“Mobile is the platform of today, and now we’re also getting ready for the platforms of tomorrow,” Zuckerberg said. “Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate.”

Buying Spree

Facebook agreed to pay $400 million in cash and 23.1 million shares for Oculus, as well as an additional $300 million if the startup achieves certain milestones, the Menlo Park, California-based company said in a statement yesterday.

The deal follows a spate of acquisitions that Facebook has used to build up its mobile business. Last month, the company agreed to purchase messaging application WhatsApp Inc. for $19 billion. In 2012, Facebook bought mobile photo-sharing program Instagram for about $700 million.

The 10-year-old social network, which held an initial public offering in 2012, has completed or announced more than 40 acquisitions valued at a total of more than $21 billion, including WhatsApp, Oculus and a $550 million deal for a Microsoft Corp. portfolio of patents, according to data compiled by Bloomberg. Facebook had $11.4 billion in cash and investments at the end of 2013.

Facebook shares rose less than 1 percent to the equivalent of $65.03 in German trading at 9:04 a.m. Frankfurt time. They added 1.2 percent to $64.89 at the close in New York before the acquisition was announced and have gained 19 percent this year.

Real Potential?

Facebook’s claim about virtual reality’s potential is hard to prove or disprove, said Mark Mahaney, an analyst at RBC Capital Markets.

“What we do know is that Facebook was late to adopting the mobile platform, though it certainly caught up with this platform shift and is now arguably one of the shift’s leaders,” said Mahaney, who has the equivalent of a buy rating on the shares. “The question this time is whether Facebook is too early or simply betting on the wrong platform.”

Oculus will be competing in a crowded wearable-technology market. Google is rolling out Glass, which are spectacles with smartphone capabilities, and earlier this week teamed up with Luxottica Group SpA, which owns eyewear brands such as Ray-Ban, to help the product go mainstream. Samsung Electronics Co. has introduced smartwatches. Intel Corp. yesterday said it acquired closely held Basis Science Inc., the maker of a wristwatch-like device, website and app that help users track exercise and sleep.

Services, Advertising

Zuckerberg said on a conference call that he doesn’t expect the Oculus devices to be profitable. Facebook plans to make money through software and services or advertising instead, he said.

“We still have a lot of work to do on mobile but at this point we feel strong enough in our position that strategically we also want to start focusing on building the next major computing platform that will come after mobile,” the CEO said on the call. “We’re making the long-term bet that immersive, virtual and augmented reality will become a part of people’s daily lives.”

Facebook considered building its own virtual-reality platform, yet didn’t have the technology or engineers that Oculus had, Zuckerberg said. The CEO said he wants to make Oculus’s product “ubiquitous” and bring it to market as soon as possible.

Zuckerberg said Facebook can foster acquired technology by citing Instagram, which had about 30 million users in 2012 before its purchase and now has has 200 million.

Rift is available to some developers, though not yet to consumers. More than 75,000 software development kits have been ordered by those who want to build programs for the device, Oculus said.

Oculus’s Beginnings

Oculus was founded by entrepreneur Palmer Luckey, a self-described hardware geek, and is run by CEO Brendan Iribe. The company has raised more than $91 million, including a $75 million round led by Andreessen Horowitz in December and $2.5 million of preorders from a campaign on crowdfunding website Kickstarter in 2012. Bloomberg LP, the parent of Bloomberg News, is an investor in Andreessen Horowitz.

Most of Oculus’s 100 employees work near the John Wayne Airport in Orange County, California, in an office park that’s festooned with old game controllers and models of alien creatures.

The Oculus team met with Facebook executives including Zuckerberg a few months ago in Southern California, the startup said in a blog post. Discussions evolved into “an even deeper vision of creating a new platform for interaction that allows billions of people to connect in a way never before possible,” Oculus said.

No bankers were involved in the deal, according to a Facebook outside representative.

Shared Vision

“A few months ago when Mark and his team came down to visit our offices, it was immediately clear that the two teams share a passion for building a new world-changing communications platform,” Oculus CEO Iribe said on the conference call. “This is a team that’s used to making bold bets for the future.”

Facebook will help Oculus recruit, pursue partnerships and provide marketing and infrastructure, Iribe said.

Antonio Rodriguez, an Oculus board member who is a partner at Matrix Partners, said the startup has been an object of interest for other acquirers.

“I’m happy for Facebook because this is not a company that has lacked for suitors along the way,” Rodriguez said in an interview. “Facebook just did a much better job talking to the team.”

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FED Unemployment Delusions

I have argued, for at least a few years, that the FED is delusional and behind the ball most of the time. If minutes released from their 2008 meetings don’t prove that without a shadow of a doubt, I don’t know what will. If you recall, those minutes clearly showed Bernanke anticipating economic growth and worrying about housing prices going up as late as Q3 of 2008. Mind you, the stock market was already down more than 30% at that stage. To keep their stupidity streak alive, the FED presents us with another gem. Get this, according to James Bullard, president of the Federal Reserve Bank of St. Louis, the unemployment rate will fall below 6% this year. 

The reality, of course, is a little bit different. Never mind the fact that their unemployment calculation understates the real unemployment by a good 2-4%. The most significant issue here has to do with where we are in the economic cycle. Based on our mathematical and timing work, the bear market of 2014-2017 is about to rear its ugly head. Shortly thereafter, the US Economy will fall back into a severe recession where unemployment will quickly surge. To be honest, I am afraid Mr. Bullar will see 10% unemployment before he sees 6%. 

Just more prove, as if you needed any, that the FED is ill-equipped for forecasting future economic developments. 

If you would be interested in learning exactly when the bear market of 2014-2017 will start (to the day) and its internal composition, please Click Here. 

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FED Unemployment Delusions  Google

Reuters: Fed’s Bullard says U.S. jobless rate expected to fall below six percent this year

HONG KONG (Reuters) – The U.S. unemployment rate will fall below 6 percent by the end of this year, a Federal Reserve official said on Wednesday, offering a bullish view on the country’s economy after central bank comments sent shock waves through financial markets last week.

James Bullard, president of the Federal Reserve Bank of St. Louis, said that the outlook for the U.S. economy is “quite good,” despite data from early in the year.

“The biggest thing is that unemployment has come down more quickly than expected,” said Bullard, speaking on a panel at the annual Credit Suisse investor conference in Hong Kong.

He added later during a question and answer session that more progress is needed in the labor market before U.S. policymakers can consider raising interest rates.

Bullard is known to be one of the Fed’s more hawkish policymakers. He previously advocated for a rate hike as early as 2014, a stance he appears to have backed away from.

U.S. monetary policy tightening took center stage last week after a two-day policy meeting, when the Fed said it expected to keep benchmark interest rates near zero for a “considerable time” after it wrapped up a bond-buying stimulus program, which it is widely expected to do toward the end of the year.

Pressed on the statement at a news conference afterward, Fed Chairman Janet Yellen said the phrase “probably means something on the order of around six months or that type of thing.” Stocks and bonds immediately tumbled as traders took the statement to suggest rate hikes could come sooner than they had anticipated.

Bullard has joined other Fed officials in playing down the “six months” comment from Yellen, saying it was in line with what the private sector was anticipating. He repeated that view on Wednesday.

The unemployment rate for February rose to 6.7 percent from a five-year low of 6.6 percent as Americans flooded into the labor market to search for work.

But the rate hovering around the Fed’s previous 6.5 percent benchmark has raised the prospect of the central bank moving to push up rates more quickly than some in the market previously expected.

Fed officials appear increasingly worried that keeping policy so easy for so long could encourage investors to take too many risks, building bubbles that may eventually pop and roil financial markets.

The U.S. economy is “set for a pretty good year,” Bullard said on Wednesday. “Despite the spate of weaker data in the January, February time frame.”

The Fed has held rates near zero since late 2008 to help the economy recover from the 2007-2009 recession.

Bullard was asked about where he saw interest rates in 2016, at which point he referred to his “dot.”

The Fed introduced a “dot chart” in its January 2012 economic projections. Each dot represents the view of an individual policymaker on how they see the appropriate level of interest rates for the coming few years.

“I’m here to tell you that my dot has not changed,” Bullard said.

Data on Tuesday showed U.S. consumer confidence surged to a six-year high in March and house prices increased solidly in January, positioning the economy for stronger growth after a weather-induced soft spot.

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Russia Moves To The East

Russia, fed up with the West’s intentional destabilization of Ukraine and subsequent sanctions is moving fast to aggressively diversify it’s oil and natural gas business by going after China and India. Just as predicted earlier on this blog. This does not bode well for the EU, who might soon find itself competing for Russia’s natural resources with close to 3 Billiion people in Asia. 

Rosneft, one of the world top oil producers is looking to join forces with India’s Natural Gas Corp to supply India over the next few decades. At least. That is on top of partnerships and new deals Russia has with China. With geopolitical picture the way it is today, the future battle lines are being drawn today. With the USA/NATO on one side and China/Russia on the other.  Just as this report indicated.  

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Reuters Reports: Russia’s Rosneft, India’s ONGC may join forces on oil flows

(Reuters) – Rosneft (ROSN.MM), the world’s top listed oil producer by output, may join forces with Indian state-run Oil and Natural Gas Corp (ONGC.NS) to supply oil to India over the long term, the Russian state-controlled company said on Tuesday.

Rosneft CEO Igor Sechin, an ally of President Vladimir Putin, travelled to India on Sunday, part of a wider Asian trip to shore up ties with eastern allies at a time when Moscow is being shunned by the West over its annexation of Crimea.

With EU nations threatening to cut their reliance on Russian oil and gas, Russian officials have started to look East.

Rosneft said it had also agreed with ONGC they may join forces in Rosneft’s yet-to-be built liquefied natural gas plant in the far east of Russia to the benefit of Indian consumers.

Rosneft did not provide any additional details on its planned cooperation with ONGC.

The company said Sechin and the head of Indian conglomerateReliance Industries (RELI.NS) also met and discussed potential cooperation in developing Russia’s offshore resources, viewed by Moscow as a source of future oil production growth.

India was the last country in Sechin’s Asian trip, where he also visited Japan, South Korea and Vietnam.

Russia is the world’s top oil producer, pumping over 10 million barrels per day but mostly from west Siberian deposits, which are running out. Moscow is betting on offshore and unconventional oil to maintain the level.

At the same time, Russia is trying to diversify its energy flows away from its core European markets, with Rosneft leading the race with plans to triple oil flows to China to over 1 million barrels per day in coming years.

Rosneft said Sechin also discussed potential shipments of Russia’s East Siberia-Pacific Ocean (ESPO) oil blend to India’s biggest refiner Indian Oil Corporation (IOC.NS) but did not provide details.

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Stock Market Update. March 25th, 2014. InvestWithAlex.com

Daily Chart March 25, 2014 investwithalex

An up day for the markets with the Dow Jones up 91 points (0.56%)  and the Nasdaq up 8 points (0.19%).

The market continues to move exactly as per our mathematical and timing forecast (available in subscriber section). In fact, thus far, the setup has been ideal. As I have suggested yesterday the Nasdaq and the Biotech sectors were oversold and due for a bounce. We saw some of that today. I would anticipate that both of the aforementioned sectors will continue their bounce over the next few days. 

Yet, it’s not all peaches. Despite what most other market practitioners believe, the bear market of 2014-2017 is just around the corner. When it starts it will quickly retrace the move from February 5th low and keep going lower. Much lower. If you would be interested in learning exactly when the bear market will start (to the day) and it’s internal composition, please Click Here

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Stock Market Update. March 25th, 2014. InvestWithAlex.com Google