Turbulent Tidbits

1.China and Russia have effectively switched to domestic currencies in trading using financial tools as swaps and forwards, as they seek to reduce the influence of the US dollar and foreign exchange risks. The country’s Foreign Exchange Trade System will carry out similar transactions with the Malaysian ringgit and the New Zealand dollar. China has set up bilateral currency swap lines with more than 20 countries and regions since 2009, including Switzerland, Brazil, Hong Kong, Indonesia and South Korea, Xinhua News reported in July.

COMMENT: There is a movement underfoot to reduce the reliance upon the USD as a reserve currency. Still small, but growing.

2. The Central Bank of Venezuela confirmed that the country entered a recession in 2014, a bank statement said Dec. 30, Reuters reported. According to the bank, Venezuela's economy shrank during the first three quarters of the year. GDP dropped by 4.8 percent year-on-year in the first quarter of 2014, followed by 4.9 percent and 2.3 percent declines in the second and third quarters, respectively. Additionally, 12-month inflation reached 63.6 percent by November. COMMENT: The fall in oil prices has devastated this economy and the first rat to flee the sinking ship is Cuba.

3.Ukrainians received gloomy economic news Dec. 30 when the governor of the National Bank of Ukraine announced that the country's real gross domestic product declined by 7.5 percent in 2014. COMMENT: Another unending crisis unfolds.

5.Israeli high-tech exits doubled to a record $15 billion in 2014. This has been by far the best-ever year for the country's high-tech and biomed sector in terms of exits, according to figures published today by PwC Israel. http://www.globes.co.il/en/article-record-15b-israeli-high-tech-exits-in-2014-1000997256 COMMENT: Go Israel!

6.Turkmenistan devalued its currency against the U.S. dollar by 18.6 percent Jan. 1, AFP reported. The move is a rare negative sign of The country's economy following the plunge of the Russian Ruble. The Central Asian country, which has seen high GDP growth in the past few years, is an important producer and exporter of natural gas.

7. The export-import bank of China granted Ecuador a $5.3 billion credit line following the decline of the price of oil Bloomberg reported Jan. 6. Finance Minister Fausto Herrera said in a statement that the country would use some $1.5 billion this year to finance infrastructure initiatives, including irrigation and transportation projects. Crude oil is Ecuador's biggest export, and the country was forced to cut spending after its drop. Ecuadoran President Rafael Correa traveled to China this week to ask for the loan.COMMENT: He who pays the piper calls the tune.

8.The US Labor Department said on Friday its Consumer Price Index fell 0.4 percent last month, the largest drop since December 2008, after sliding 0.3 percent in November. In the 12 months through December, CPI increased 0.8 percent. COMMENT: Imagine an interest rate rise on top of this figure!

The techniques I developed for studying turbulence, like weather, also apply to the stock market - Benoit Mandelbrot