The Trump attempt to get get a “reset” with Putin in Germany was not only misguided but unnecessary. The reason is that Germany's leading company already has worked out how to avoid the boycott placed on Russia over its seizure of the Crimea and parts of eastern Ukraine, as revealed yesterday by the Frankfurter Allgemeine Zeitung on its website in an article about Siemens. Europe's largest industrial manufacturing company has used joint venture companies in Russia to ship two embargoed electric power station equipment to Sebastopol, the main city in the Crimea and is now preparing to ship two further power stations to its second city, Simferopol. The power stations were made at Siemens Gas Turbine Technologies in St. Petersburg, which is 65% owned by the German firm and uses its technology.

The German conglomerate shipped the first Crimean power stations after the embargo by using a Russian joint venture with Rostec, a complex organization which owns civilian and military companies. While supposedly destined for Taman peninsula, the turbines were shipped to the seized Ukrainian territory in 2015. The rerouting caused problems for the jv, because the breakaway Crimean region could not pay for the power station and declared bankruptcy last Nov.

To overcome the problem, another Rostec-Siemens jv entered the breach, ZAO Interautomatika, in which Siemens owns only 46%. It funded and completed the Sebastopol power station installation and was preparing to ship another two turbines for Simferopol—until the press found out. Now this morning, after the FAZ article appeared, Siemens told Reuters it is taking legal action to prevent components necessary to commission the second power plant from being shipped to Crimea. An unnamed Siemens source in Berlin told the wire service that rerouting turbines for delivery to breakaway parts of Ukraine would be a breach of contract, but asked not to be named because the matter is still being investigated.

Siemens' slogan is “Ingenuity for Life”, but what this really means is “Ingenuity for Profits.”

Don't think crime doesn't pay. Arconic missold to installers of cladding to the Grenfell Tower which burned down last month and its stock price fell. This led J.P. Morgan analyst Seth Seifman to rate ARNC outperform rather than neutral while cutting his target price to $28 from $30. Friday the share was at $23.13 so naturally the ethically-challenged stock market price of the share rose 2.9% bringing its YTD rise after it was spun out by Alcoa to 27%. I own ARNC and now am considering buying SIEGY.

After a fat-finger trade crashed the gold market, another on Friday crashed the silver market. This may be an argument for or against robotic trading. I am not sure which.

Drugmakers

*The newly named board of Stada Artzneimittel of Germany, which was put back into the model portfolio at the end of last month, approved a renewed bid for STDAF from US hedge fund Bain Capital and British private equity group Cinven. The former board, CEO, and CFO resigned last week after the first bid bailed. In Frankfurt trading the share rose 1.3% to euros 65.32. The offer is at euros 66.25 while the earlier one was 3% lower. The pair also has reduced the level of acceptance to 63% from 65%, and cut the time to accept to two weeks. After the board approved, a BAFIN regulatory okay for the offer is a mere formality . When the offer goes live my brokerage, Fidelity, promises to send me word, which may not happen based on the last time. We bought it back after the earlier bid flopped because of the highly diverse individual shareholders at STADF and because of bad vibes about Andrei Shleifer, the Harvard economics prof whose fines of $26.5 mn for defrauding the US govt with funding for supposed help for democracy in Russia, where he was born. His fines were paid under Harvard's reign of Larry Summers, because he had tenure. Prof Shleifer is the nasty side of vulture capitalism from the German perspective, and the fact that he is Jewish may add to the negative view. Stada is largely owners by doctors and independent pharmacies, and Shleifer's fund is the 2^nd largest holder of its shares.

*Diabetes is in the news, as is hemophilia.

Vodafone will offer the iGlucose platform from SmartMeter LLC as a mobile phone app under its Internet of Things platform, eventually in over 160 countries. VOD is a telephone operating firm.

*Danish Novo Nordisk warned that some of its NovoPen insulin injection cartridges may break or become contaminated if cleaned and should be replaced. There are specific lines of the Echo and 5 lines that are being recalled. It is the leading maker of diabetes drugs but also is moving into hemophilia products.

*Shire Pharma over the weekend got an injunction in a Hamburg court against Roche over claims made by RHHBY for its emicizumab hemophilia drug which the Irish firm said were “incomplete and misleading. “ the Swiss firm said cut the bleed rate 87% in patients who had developed resistance to the standard therapy. However there were serious adverse events in the Roche trial, notably blood vessel damage in vital organs, like thrombotic microangiopathy, which can be fatal.

The hemophilia market is worth $11 bn per year and Shire claimed its injunction was to “prevent further dissemination of inaccurate and misleading characterization of the serious adverse events that occurred in the Haven 1 phase 3 trials.” Shire last year invested $32 bn to buy Baxalta, a US hemophilia drug specialist, for which SHPG went heavily into debt. Shire CEO Flemming Ornakov already told skeptics last week that ACE910 with questions abounding over its safety and tolerability, damaging Shire in hemophilia was not “super realistic”, especially outside the US where long-term supply contracts prevail. Shire will be repaying the money spent on Baxalta until 2020 so I hope he is right.

Roche can appeal against the preliminary injunction.

*Ford Equity likes drugmakers and raised both Teva and GlaxoSmithKline from hold to buy. TEVA is an Israeli generics producer and GSK a UK generalist. TEVA also may gain from problems with liver damage from Zinbryta, the multiple sclerosis drug from Biogen and Abbvie which now faces prescribing restrictions and a black-box warning. It directly competes with Teva's original Copaxone 20 mg daily dose, which also faces generic competition—but which can be given to people with liver disease.

Arms and Autos

*Ford Equity also raised BAE Systems to buy from hold. I wonder if they are copying me? BAESY is British and active in US armaments and cyber. BAE gained after a UK court rules against a group trying to stop it selling arms to Saudi Arabia because of heavy bombing of civilian targets in Yemen.

*Columbine Capital Services upped Sweden's Autoliv to favorable from neutral. ALV makes non-exploding airbags and is diversifying into automated driving systems.

Food and Clothing

*A mere 7 weeks after Naspers took a stake in Germany's Delivery Hero, which uses bicycles to deliver their dinner to city-dwellers in 40 countries, Delivery Hero did an ipo in Germany where it is HQ'd. NPSNY bought at $3.1 bn in May, giving the German tech startup more street cred. It is a first launch from an incubator in Berlin, Rocket Internet, which holds an even larger stake. Naspers' stake after the June 30 German listing is now worth $5 bn, according to this week's Economist. Bicycle delivery is particularly popular in Saudi Arabia and Hong Kong, the weekly says, but of course is not really a pure tech play either. The question is whether Delivery Hero can become a category killer via the network effect. I suspect it is not going to happen in the USA.

*Mexican MNC baker Bimbo stock gained 6% yesterday. GRBMF is heading for $2.60.

*Toray Industries, TRYIY, make of modern materials, mostly used for garments, was upped to buy from hold by Zacks, the Chicago-based analysis shop which is becoming an over-trader in my view.

Tech

*Lingo Media of Canada dropped 20% yesterday after protraderdaily.com, a UK tracker of moving averages said it was ahead of both its 50- and 200-day averages. LMDCF is already in the cross-hairs because of delays in its planned merger with US SchoolD, another edu-tech firm which offers free online and mobile app advise on matching students to colleges. The merger is being delayed until July 31 from an earlier June 30 target date. The real risks is that SchoolD may be suffering from the DeVry scandal because this outfit promised levels of pay and promotion which its courses did not fulfill.

The planned merger of equals will be followed by a private placement. SchoolD is considered by US News & World Report to be a “must-have” for international students and is run out of San Francisco where it was developed by Vested Finance Inc. I am holding back buying more lest there be more dirt around the schoolroom.

*Susquenhana has cut its target price for Infosys to $13 from $15 after the Indian software giant made a commitment to hire 2000 Americans for tech jobs in North Carolina by 2021, and 10,000 in the US overall. The new tech hubs are an attempt to escapte the uproar over INFY's use of H-1B visas to bring highly-skilled workers to the US temporarily. Indians account for about 70% of the H-1B visas issued. INFY moreover agreee to pay fines of $34 mn to settle claims from the US Dept of Justice and $1 mn to NY State for tax evasion and underpaying Indian workers by using travel visas rather than H-1B ones. The Industrial Commission of North Carolina, home of the Research Triangle, opted to change its rules to make it harder for Indians to work temporarily in the state and denying their employers the right to receive NC job-creation grants. The NC bill will deny companies the right to use visas to meet job-creation levels in incentives contract. Along with concerns that INFY brass are overpaying themselves, this is enough for us to exit INFy entirely before it reports in its Q1 July 14, Bastille Day.

Hydrocarbons

*BP plc informed the world that 5 of its new concessions are for natural gas rather than oil, a cleaner fuel. It may buy more of the Abu Dhabi State Oil Co (ADNOC) which is seeking to publicly list its shares in some operations. BP currently owns 10% of ADNOC, as does Total. Each paid $2.2 bn for the stake. But unlike TOT BP is not investing heavily in Iran, which may cause problems in the Emirates where ADNOC supplies most of the 2.9 mn barrels/day produced there. The sales may be in local markets outside the Gulf and include refining, petrochemicals, pipelines, and storage subs. ADNOC however will remain in state hands, unlike what is happening with Saudi Aramco.

*Delek Group revised its description of its newly acquired Canadian sub, Ithaca Energy, which operates in the UK North Sea from its earlier press release description of the acquisition. The main impact is to increase the possible variations in output from the assets.

Commodities

*Brazil's inflation having remained low, the CB now is not expected to raise rates, and both Vale and Cosan are up 2.5% yesterday. VALE and CZZ are heavy exporters and borrowers.

CZZ won approval from the Conselho Administrativo de Defesa Economico for buy refineries Santa Catarina and Paraiso.

Vale is benefitting from stronger Chinese demand for iron ore which hit $64.95/tonne in Qingdao

*SoQuiMich of Chile (SQM) is partnering 50:50% with Lithium Americas of Canada in the Exar project in Argentina, down the road from Orocobre of Oz, OROCF. The SQM jv won finance of $172 mn from Gangfeng Lithium of China for eventual produciton of 25,000 tonnes of Li per year. The latest rumor is that Gangfeng wants to buy into SQM as well.

*Agrium is up 6.06% as market resume their love-affair with commodities. It is being merged into Potash of Saskatchewan which mines potash.

Finance

*Allianz SE coverage was dropped by Zacks so if you want to learn about AZSEY of Germany you need to read this newsletter.

*Santander opted not to offer UK shareholders a chance to buy into the euros 7.1 bn capital increase for funding Banco Popular  because the legalities were too complicated. Same for ADR owners. Only in euroland and Spain can you buy the new shares.

It also is raising via a private placement of senior unsecured notes in the USA, also not for individual investors. The money may be used to up SAN's stake in Santander Consumer USA, its subprime car loan unit, which managed to pass the Fed's stress test a month ago, from 59% to 68% as co-founder Tom Dundon wants to sell.

*Validus Holdings reported insider acquisition of restricted stock units. The Bermuda reinsurance firm's insiders kept their VR shares which is bullish.

Funds

*Eaton Vance Global Dividend Equity Income Fund, EXG, reduced the amount of its payout coming from return of capital in the last quarter, to 89.7% because its earned income rose.

*City of London Investment Group, a fund of closed-end funds, bought 30,000 shares of Morgan Stanley India Fund, IIF, last week, worth $981 mn. The fund is run by Barry Olliff and is marketed to US institutions but not to retail investors. As we exit some of the over-exposed and under-performing Indian ADRs like Infosys and Tata Motors, put some of the money into IIF which specializes in Indian small cap selection. INFY rose 3.1% in India yesterday and TTM 2.3% so if the rise continues we will have cash on hand.

*New Ireland Fund's top holding as of June 30 was CRH plc, the Irish cement and aggregates firm. It lowered its stake in Ryanair over concern about how landing rights will be covered after Brexit given that RYAAY mostly flies Britons to vacation areas in the European Union. RYAAY now accounts for 14.8% of IRL's holdings vs 22.1% for CRH. Paddy Power plc at 7.4% is third; we sold it. Foodmaker Greencore Group at 2.6% is a minor holding but now ahead of Kerry Group, the dairy giant, also under threat from Brexit.

*Bonus stock Global Self Storage Inc is in play as Financial & Investment Mgm Group Ltd has taken an 11.62% stake in SELF. FIM is a 25-yr old US wealth management firm regulated as an investment advisor with the SEC operating across the US, and not associated with SELF, focused on undervalued assets. We got into SELF because it used to be Global Investment Fund, GIFD, a family controlled outfit which had the deepest discounts among global closed-end funds. It changed its mandate to self storage facilities. We sold half when my son the financial analyst said that storage rooms are often abandoned by people who run out of money and are riskier than other REITs.