The President appeals to Supreme Court to suspend investigation on him.

No, that’s not breaking news on the Trump administration’s ties to the Kremlin.

Rather, it comes from Brazil where Michel Temer is attempting to plug holes in a quickly sinking ship. You’ll recall that last week, a new corruption scandal erupted in the country, promptly sending the real tumbling and triggering circuit-breaker-tripping madness in Brazilian equities.

As we noted the next day, that rather unpleasant turn of events led directly to a case study in why you probably shouldn’t own triple-levered ETFs. Specifically, the Direxion Daily Brazil Bull 3x Shares ETF, ticker “BRZU,” crashed a truly impressive 48% on the day which, as you can see from the following chart, was “anomalous” to say the least:

Well for those wondering just how bad the FX carnage was historically speaking, have a look at this chart from Citi:

That red band is the 2-standard deviation band.

Yeah. Black swan-ish.

Of course there’s some significant spillover risk here for EM as a whole, so this is a situation you’ll probably want to watch fairly closely as much as it pains you to follow Latin American politics.

To help, here’s Bloomberg’s summary of the latest developments:

President Temer defiant as pressures mount, both in speech on Saturday and on interview w/ Folha, Estado column. Temer appeals to Supreme Court to suspend investigation on him and Court’s decision — expected for Wednesday — could be key in determining Temer’s remaining political support, local media says.

• Odds of Temer falling rose to 70% from 20% despite doubts over the evidence implicating him: Eurasia
• Govt coalition defends indirect election as Temer’s days seen numbered: Globo
• Newspapers bring several possible contenders to replace Temer; local media extensively discusses potential rules for who could run in indirect election, which isn’t completely clear, as well as possibility of direct elections
  • Supreme Court Chief Justice Carmen Lucia, Justice Gilmar Mendes, former Justices Joaquim Barbosa, Nelson Jobim among mentions from judiciary branch
  • Finance Minister Henrique Meirelles, Lower House President Rodrigo Maia, PSDB Senator Tasso Jereissati, Former President Fernando Henrique Cardoso also among cited; Former President Lula and Marina Silva, Ciro Gomes, Jair Bolsonaro also seen as potential bidders by local media
• Temer, citing Folha analysis, questions authenticity of audio; expert hired by newspaper says there are cuts in the file; J&F says audio was not tampered with
• Supreme Court Justice Fachin accepts Temer’s defense request to have tape analyzed; federal police says it has received the audio and asked prosecutors for access to equipment that made recordings; police also said there is no deadline to finish analysis
• Newspapers split on support to govt; Globo on Friday called for his resignation and defended indirect elections, while Estado and Folha have called for calm in op-eds; newspaper columnists highlight uncertainty of what would come next if Temer falls
• PSB splits w/ govt, but minister stays in govt: Globo
• PSDB postpones decision on govt support: UOL
• Temer met w/ ministers and lawmakers on Sunday night, asked for support: Estado
• Bar association says will file for Temer impeachment
  • Maia likely to dismiss all impeachment requests: Estado