Charles Payne

“Today is a reminder that the United States means what it says, and we will rally the international community in standing up for the rights and freedom of people around the world”

-President Obama

Yesterday, the rally faded quickly as Europe ratcheted up sanctions against Russia, with America following suit. Make no mistake, this is a high-stakes gambit; there is no guarantee it works, or how long it would take Russia to cry, “Uncle.” On that note, it does seem like our definition of civilized behavior would be Ukraine separatists allowing international observers to review the crash site and to gather more bodies.

When asked if this was the start of a new Cold War, President Obama replied, “No,” and made the point that Ukraine is better armed than the separatists. It might not be the start a cold war officially, but the stock market reacted with a strong chill. And speaking of the cold, Russia has a long history of suffering for the cause, while the west has a long history of losing to them during winter. This could get ugly if this non-Cold War drifts long enough. Bundle up.

In the meantime, those Russian sanctions have sent money rushing into bonds, sending European yields to levels not seen in a few years: Spain since 1789, France for 200 years, Germany since the 1800s, and the Netherlands for 500 years. These funds would be better used to help the continent recover, instead of bracing for the worst.

Europe

Yield

1 Year

Germany

1.12%

-54

Britain

2.54%

+23

France

1.50%

-77

Italy

2.64%

-182

Spain

2.46%

-221

Netherlands

1.31%

-75

Portugal

3.56%

-288

Greece

5.76%


Charles Payne

Charles V. Payne is a regular contributor to the Fox Business and Fox News Networks. He is also the Chief Executive Officer and Principle Analyst of Wall Street Strategies, Inc. (WSSI), founded in 1991 which provides subscription analytical services to both individual and institutional investors.