As promised I am not going to rattle on about China. Instead, look at Putin-land. My tirade has a personal side. I had my teeth cleaned on Wednesday by Irina, the Russian dental hygienist, who scraped at the plaque by leveraging against the saliva suction device so hard that she drew blood at the base of my gums.

Maybe she thought she was fighting western imperialism despite my talking to her in my rudimentary Russian. I remarked that I had just returned from London which was full of Russians, and Irina insisted that they were tourists, not exiles.

Not so. Emigrés are investing in Britain to get out of Russia to protect their wealth and their family's future. The murder of Boris Nemtsov on a Kremlin bridge in Feb. led more activists to flee. Many London Russkiys fear trumped up embezzlement charges or assassination, not that London has proven a safe haven to Alexander Litvinenko, Alexander Perpilichny, or Boris Berzovsky, all dead under mysterious circumstances.

Less prominent Russians are piling into the UK, paying between £1 mn and £4 mn to gain residency rights, with the higher sum working faster. Most of the money is going into high-end real estate holdings to avoid the risk of expropriation by Russia.

Putin is desperate to stop the UK emigration wave which has led a quarter of a million Russians to move to Britain seeking to escape from the Russian state. A new Russian Federal Law 376-FZ, which went into force this year, requires that Russian living abroad report on their overseas commercial interests. This gives Putin a list of hidden assets that can be seized. Housing appears to be exempt, for now. The new law also requires that emigrés report second passports, a more serious threat to the Russian London community.

Irina aside, here are some bullying moves by Vladimir Vladimirovich Putin's country today. First Russia destroyed 150 mn metric tonnes of European Union pork in its cold stores because they had been illegally imported. They came into Russia after it banned pigmeat from the EU, ostensibly on health grounds. This was really an attempt to put pressure on the EU after it imposed sanctions over Ukraine.

Then it threatened to confiscate US-owned property were the US to freeze Russian state assets to enforce a $50 bn damages award to former Yukos shareholders. After its CEO Mikhail Khodorkovsky accused Putin's administration of accepting bri​b​es, Russia deliberately destroyed the oil company with punitive taxes and expropriated its assets.

Yukos shareholders and its employee pension scheme last summer were awarded those damages by the Permanent Court of Arbitration in The Hague. Under the terms of its adhesion to the court, Russia was allowed to name one of the 3 judges (who ruled against it with the other two) and also to plead its case with a team of lawyers. It still lost.

Under the New York Convention, of which Russia is a signatory, The Hague court can ask other countries to enforce its rulings by seizing Russian state assets. That the US Dept. of State authorized under international treaties Russia adhered to. Moreover, other Yukos suits by executives on behalf of shareholders in the International Court of Human Rights resulted in another judgment of euros 1.9 bn against Russia.

Unlike its exiled oligarchs, Russia is short of the ready. It invested in gold to avoid being subject to sanctions enforced by US banks for using dollars. It has lost $2 bn as the gold price fell.

I have long put off writing about how silly an idea robo-investing is. Gen Joe Shaefer, who manages money at www.stanfordwealth.com and writes a monthly called Investor's Edge, beat me to it. Here, with permission, is his note:

“I love new technologies. But it bears pointing that there are many sides to every innovation — and that human intervention should be part of any fail-safe robotic system. Otherwise we all become subjects of the old joke about the new pilotless commercial aircraft, where the announcement comes on after takeoff, 'Ladies and gentlemen, welcome to USAmDeltaUnited flight # 654 from Detroit to Puerto Rico. Embracing new technology, we are proud to announce there are no pilots aboard the aircraft and a cabin crew is not necessary since anything you need our automated robotic attendants can provide. So relax, sit back and enjoy the flight. And remember, nothing can go wrong, hic!, nothing can go wrong, hic!, nothing can go wrong...'

Like new technologies, a certain style of investment management and portfolio allocation has risen its head yet again — as it always does after a 5 or 6 year bull market. The benefit of these approaches is that they don’t require any decision-making. These are automated investment plans.

'Use a robot!' This will be either some quant black box approach that determines when to buy and sell or, better, rebalances a diversified portfolio tied to many different benchmarks like emerging markets, small cap US, large cap international, etc. The rebalancing forces you to buy low and sell high. When one part of the portfolio performs better than the others and another performs worse, the percent of each held will deviate from your chosen parameters, and you’ll rebalance. This approach assumes a steady reversion to the mean so you are, theoretically, selling a part of your winners and adding to your losers, which will revert to the mean and become winners.

“New 'robo-investing' sites tell you you shouldn’t pay someone else when you could be paying the robo-siteless. A robo-investing site that rebalances regularly without a human understanding of market history, technical analysis, fundamental analysis as to the external economic environment, or behavioral analysis of investor and consumer sentiment is a dangerous place to be — a la the automated airplane.

By selling on the basis of an arbitrarily-selected date and a graven-in-stone universe of geographic (US, international, emerging market, etc.) and/or capitalization-weighted (US large cap, foreign mid-cap, etc.) [allocation] one decides, in advance, to leave much on the table in exchange for not losing big.

Besides, if it isn’t possible to beat the benchmarks, then what accounts for the steady outperformance over many years of some of my colleagues? I note immodestly that our own G&V Portfolio has returned 9.4% annually versus the S&P’s 5% — including all S&P dividends. Maybe I and all my other colleagues I credit in these pages have just been lucky for a decade or more. Or maybe it pays to have a human driver, you, me, or someone else you trust, with a focus steadily on the road ahead and hands firmly on the wheel."

Results, results, results!

*Novo Nordisk (NVO) reported on H1 sales and profits and scored a clear beat, although warnings about China caused a market hiccough. H1 net profits rose 35% to DKK 18.2 bn ($2.6 bn) on sales up 25% to DKK 52.26 bn ($57 bn). While NVO cited mounting competition particularly in the US market, it also clearly is doing well thanks to its Victoza weight-loss drug and its Levemir insulin. It raised its estimate of full year operating profit gains to 19% from 17%.

In the conference call CEO Lars R. Sorensen remarked that China sales in Q2 at DKK 2.2 bn were off by the official drop in growth (6-7%) but also suffered because of sector specific issues. China is imposing cost containment on healthcare hitting imported drugs. Moreover doctors fear the anti-corruption drive by Beijing (after GlaxoSmithKline's (GSK) bribes were exposed) and are fearful of buying foreign meds and charging a premium when prescribing them, as was the past practice.

However, CFO Jesper Brandgaard stressed that NVO will not abandon China which has the largest number of diabetics in the world, 96.3 million people. Sorensen added that “we want to be seen as a Chinese company.” The stock fell 4.2% in Copenhagen and is off 2.3% so far here.

*Ecopetrol (COP) Q2 net income was COP 1.696 trillion ($5.006 bn) off 38% from prior year despite a 5% rise in production to 768 mn bbls/day and good refinery results, because of the oil price. Sales were COP 14.01 trillion, down 17%.

Facing a challenging oil price scenario, EC strategy is to continue searching for efficient and profitable barrels. It identified 630 initiatives YTD which can save COP $ 1.4 trillion in 2015. We stick with this stock mainly to play the peace dividend when and if a government deal is signed with the FARC from negotiations in Cuba. It is our only oil play. EC stock was up 2%+ on Wall St.

*Agrium (AGU) reports in US$. Its Q2 net earnings came in at $675 mn vs $625 mn a year ago, or $4.71/sh vs 4.34. For Canadians, it was even better. Scotiabank analyst Ben Isaacson writes about the advantage of owning a plant food firm with a retail arm:

AGU bulls may seek shelter, as three disappointments popped up, none of which we see as structural.

1. Investors may not like the cancellation of the Borger ammonia expansion, coupled with a delay to the urea ramp, as well as no material change to the $720M price tag. However, given YARA/BASF pushing forward with a 0.75M mt ammonia plant in TX, this is likely a prudent move by AGU.

2. AGU lowered its 2015 guide to $7.00-$7.50 from $7.00-$8.25, citing the impact of lower crop prices on retail EBITDA, lower P+K prices, and the impact of higher Alberta corporate tax rates.

3. Drought in Western Canada and California, coupled with wet conditions in the Corn Belt, led to reduced retail demand, which resulted in margin pressure. Accordingly, with new Retail EBITDA guidance of $1-1.05 bn coming in lower than $1.11 bn earned last year, investors will want to understand the defensive Retail thesis. It still holds.

Positives: AGU repurchased 0.95M shares @ $105/sh, and has now exceeded its 2017 targets for its Operational Excellence program ($125M recurring EBITDA + $350M one-time savings). Buy the weakness. Nothing has changed structurally, in our view.

​*For Q2, BCE Inc. (BCE) reported net earnings of C$759 mn, or 90 loony cents per share, up 25% from the same quarter last year. Excluding one-offs EPS was 87 cents meeting analyst forecasts.The increase was due largely to BCE’s full takeover of Bell Aliant, and to a $94-mn gain from selling half the Glentel wireless retail business toRogers.

Operating revenue was nearly $5.33 bn, up 2% and slightly ahead of analysts’ forecasts. Revenue in BCE’s media business was down 2.8% to $740 mn, worse than expected, because of a soft ad market. As the wireless industry navigates a competitive summer, BCE reported solid growth in mobile subscribers but spent more to keep them adding 61,000 net postpaid wireless subscribers beating analysts’ expectations.

Canadian wireless carriers are under pressure from the “double cohort,” when 2– and 3-year contracts expire at the same time because of a regulatory change banning longer terms. The industry was expected to spend heavily to keep customers with promotions, and BCE said the cost of retaining and attracting subscribers spiked by $64-mn year over year.

BCE’s churn rate in postpaid subscribers – which measures how many cut their service – rose to 1.23%, worse than forecast, offset by a 5.3% rise revenue per user. “We’ll definitely see a little lift in the retention spend in the second half of the year, and we’ll be able to absorb that within the revenue growth we’re seeing on wireless,” George Cope, BCE’s CEO, said in a conference call with analysts. Cope forecast full year revenues of C$21.25-21.67 mn vs earlier estimate of C$21,46 mn.

Last month, the CRTC regulators ruled that BCE and other Internet big providers must open access by smaller rivals to their latest-generation, fiber networks. Mr. Cope said BCE is “disappointed in the decision,” but will work to pivot to the new rules before they come into effect, likely next year. “We’ll adjust our business model and investments as we have always done, based on the incentives or the barriers put in place.”. BCE is up on Wall St.

*Zurich Insurance (ZURVY) reported H1 results with a 10% profit decline to $840 mn, well below analyst forecasts of $878 mn, which zapped the stock. It suffered from the higher Swiss franc in which it incurs costs while reporting in US$s. ZURVY is preparing a bid for UK insurer RSA for which it is raising financing. Its CEO Martin Senn told the conference call that ZURVY will return the capital it raises for RSA if it cannot get the price it wants and insure an internal rate of return of 10%. Given that Swiss insurance firms keep hefty reserves, it is significant that the Swiss insurer did not tap into these to artificially boost H1 results, to keep its powder dry gor the RSA bid. Mr. Senn said Zurich performance was “below our expectations.” Operating profit at the biggest arm of the firm, its general insurance business, fell 31% from last year to $1.17 bn. Gross premiums and fees fell 7% there and overall to $12.46 bn, off 10%. However, life insurance operating profits rose 6% in profits and 4% in premiums in the half, vs prior year. Its US sub, Farmer's Life, reported a 5% drop in operating profits, beating its parent. The stock is off 4.8%.

Other News

*Vale (VALE) will raise reais 1 bn ($290 mn by selling railway debt for its linkup to the Carajas iron ore mine whose expansion it will finance. The notes will run for 5 and 7 years and if the green shoe option is used, another reais 350 mn may be raised. Vale is again up on the news.

*Scotiabank warns about Veresen's (FCGYF) risk from low oil prices. Jordan Cove contracts are likely to be delayed. “We believe cheap oil-linked LNG caused counterparties to pause in the first place so the recent down-draft likely casts further doubt. Our estimates suggest the dividend is sustainable, excluding development costs on Jordan Cove. However, as development cost is not immaterial, the dividend may not be well covered if such costs were expensed. VSN is trading down toward our base NAV excluding Jordan Cove. But many of the stocks in our universe are now trading well below NAV. It is not inconceivable that VSN could trade below NAV particularly if Jordan Cove is further delayed.” VSN after falling hard is now off 5.4% in Toronto and about 20% down from our cost basis.

*Pershing Square Capital Mgm, whose activist offshore Amsterdam-listed closed-end hedge fund, Pershing Square Holdings (PSHZF), we own, is trying to put Humpty-Dumpty together again. Its BillAckman has taken a $5.5 7.5% bn stake in Mondelez International (MDLZ), the snack arm of the former Kraft, subsequently merged with Heinz. He wants MDLZ to grow faster or find a buyer. He filed an SEC 13D notice to tell the world. The MDLZ stock is up 5% on the news. PSH is up 1.14%.