Dec 172021
 


Paul Signac Boulevard de Clichy under snow 1886

 

Pfizer Vaccine Reprograms Both Adaptive And Innate Immune Responses (Rose)
BNT162b2 mRNA Vaccine Reprograms Adaptive And Innate Immune Responses (medRxiv)
Deep Data Dive: Is Omicron The End Of The Pandemic? (Unherd)
Studies Proving Generic Drugs Can Fight COVID Are Being Suppressed (Kory)
Omicron ‘Markedly Resistant’ To All 4 Covid Vaccines (DM)
EU Agency Backs Pfizer Covid Pill For Emergency Use (Br.)
Hong Kong Researchers Urge Third Covid-19 Shot After New Omicron Study(R.)
Refugees Lack Covid Shots Because Drugmakers Fear Lawsuits (R.)
mRNA Shots Are ‘Gene Therapy’ Marketed As ‘Vaccines’ To Gain Public Trust (LSN)
Persuasive Messaging To Increase Covid-19 Vaccine Uptake Intentions (NIH)
Pfizer and Moderna Made Large Dark-money Donations During 2020 Election (Fang)
The Year of the New Normal Fascist (CJ Hopkins)
Biden’s Build Back Better Bill Suddenly In Serious Danger (Hill)
Assange Lost Because The Judges Couldn’t Imagine The US Was Lying (Rees)

 

 

 

 

HEPA

 

 

Because the vast majority have “only” had 2 shots, and “only” minority have had 3. Goal posts.

 

 

 

Jessica Rose works with Peter McCullough.

Chemicals that reprogram your immune system are about as scary as it gets.

“..these findings provide very good reasons as to why we are seeing resurgences of latent viral infections and other adverse events..”

Pfizer Vaccine Reprograms Both Adaptive And Innate Immune Responses (Rose)

A brand new medRxiv pre-print study entitled: “The BNT162b2 mRNA vaccine against SARS-CoV-2 reprograms both adaptive and innate immune responses” has graced our world. This paper is so important and it provides evidence to support what many prominent immunologists and vaccinologists have been saying for a long time, including myself. These COVID-19 mRNA injectable products are causing, yes, causing, immune system dysregulation – and not just in the context of the adaptive system, but in the context of the innate system. Not only that, but these findings provide very good reasons as to why we are seeing resurgences of latent viral infections and other adverse events reported in VAERS (and other adverse event reporting systems) and perhaps more importantly, why we should under no circumstances inject this crap into our children. Children are fine in the context of COVID-19 (for the 80 millionth time – this well documented) and this is due to their extraordinary innate immune response systems.


Let’s rip into some background in immunology, shall we? Figure 2 shows many of the different cell types involved in the adaptive and the innate immune system branches. Most of you probably know about T cells and B cells. I would bet that many more of you have not heard of my personal favorite killer, the Natural Killer (NK) cell. They kill infected cells and are of utmost importance to a healthy and functioning immune system. The cell types involved in the innate immune response system emit special molecules in response to invaders. These special molecules primarily comprise defensins, collectins, c-reactive proteins, lipopolysaccharide (endotoxin) binding proteins and complement factors. These responses are non-specific and target invading pathogens and even cancer cells.


Figure 2: The big picture of adaptive versus innate immune cells.

In a nutshell, in this article, what they found was that the BNT162b2 (Pfizer/BioNTech) injectable products are modulating the production of inflammatory cytokines by innate immune cells upon stimulation with both specific (SARS-CoV-2) and non-specific (viral, fungal and bacterial) stimuli whereby the response of innate immune cells to TLR4 and TLR7/8 ligands was weaker after BNT162b2 injection, while fungi-induced cytokine responses were stronger. In conclusion, the mRNA BNT162b2 vaccine induces complex functional reprogramming of innate immune responses, which should be considered in the development and use of this new class of vaccines.

Read more …

Here’s that study. Which claims: “..has been shown to be up to 95% effective in preventing SARS-CoV-2 infections..”

While even CDC and WHO say it does not prevent infections. Like Pfizer said a year ago|:

BNT162b2 mRNA Vaccine Reprograms Adaptive And Innate Immune Responses (medRxiv)

The mRNA-based BNT162b2 vaccine from Pfizer/BioNTech was the first registered COVID-19 vaccine and has been shown to be up to 95% effective in preventing SARS-CoV-2 infections. Little is known about the broad effects of the new class of mRNA vaccines, especially whether they have combined effects on innate and adaptive immune responses. Here we confirmed that BNT162b2 vaccination of healthy individuals induced effective humoral and cellular immunity against several SARS-CoV-2 variants.


Interestingly, however, the BNT162b2 vaccine also modulated the production of inflammatory cytokines by innate immune cells upon stimulation with both specific (SARS-CoV-2) and non-specific (viral, fungal and bacterial) stimuli. The response of innate immune cells to TLR4 and TLR7/8 ligands was lower after BNT162b2 vaccination, while fungi-induced cytokine responses were stronger. In conclusion, the mRNA BNT162b2 vaccine induces complex functional reprogramming of innate immune responses, which should be considered in the development and use of this new class of vaccines.

Read more …

BREAKING: South Africa has decided not to introduce any new restrictions as a result of Omicron.

“If Omicron ‘outcompetes’ the Delta variant, then it could spell the end of the pandemic as we know it, putting coronavirus in the same category of disease as the common cold..”

Deep Data Dive: Is Omicron The End Of The Pandemic? (Unherd)

Since its discovery in the Gauteng province of South Africa in November, a new Covid variant has set off a spiral of harsh restrictions, travel bans and questions about the efficacy of the existing two-dose vaccines. Dr Angelique Coetzee, the scientist who first raised the alarm in Gauteng, has repeatedly assured the public that early observation of symptoms suggests that Omicron could be milder than the Delta variant. Despite some reassuring signs on the ground, reaction to the new variant has been dramatic, with Boris Johnson warning of a ‘tidal wave’ of cases in the UK and Joe Biden predicting an ‘explosion’ of cases in the US. To unpick some of the data coming out of Gauteng, Freddie Sayers sat down with researcher at the University of Johannesburg, Pieter Streicher, who has been following the developments of the Omicron variant in his home country.

Pieter is clear that, like all waves of the virus, there will predictably be a sharp increase in cases in the coming weeks in South Africa and beyond. But cases are not, he says, the best metric by which to measure the threat of Omicron. When measuring the virulence of any variant, it is more important to study records of hospitalisations and excess deaths. By these measures, Omicron is resulting in hospital admissions well below the previous wave in South Africa, and needing far less interventions like ventilation or supplemental oxygen. Excess deaths look likely to follow this pattern. With Delta, Pieter explains, patients were often coming into hospital with low blood oxygen levels and severe symptoms. Reporting from South African hospitals suggests that a higher percentage of positive tests are ‘incidental’ with the Omicron variant, with patients often asymptomatic or unaware that they were harbouring the virus.

Pieter appreciates that the initial exponential growth rate for Omicron does look dramatic. But scientists ‘make the mistake to project that [exponential growth rate] well into the future, well beyond even a plausible peak date.’ According to his observations, Omicron’s growth rate appears to already be slowing in Gauteng. If symptoms are less severe and numbers slowing, could this new variant actually be good news? Pieter is cautiously optimistic. If Omicron ‘outcompetes’ the Delta variant, then it could spell the end of the pandemic as we know it, putting coronavirus in the same category of disease as the common cold. Pieter is keeping a close eye on the newer numbers being recorded in Europe, as are we.

Read more …

“I wrote an op-ed calling out the most recent & blatant non-public health actions committed by our captured health agencies. One path forward is clear: we must redesign the system so Pharma is not in the drivers seat (they can sit in the back..maybe).”

“Why do repurposed drugs require numerous trials prior to an agency recommendation, while high-profit, novel, patented drugs get routinely approved after only a single trial?”

Studies Proving Generic Drugs Can Fight COVID Are Being Suppressed (Kory)

Since the summer of 2020, U.S. public health agencies have continually shut down the use or even discussion of generic treatments that are minimally profitable. The National Institutes of Health (NIH) funded 20 large research studies of patented pharmaceutical industry drugs before only recently (and slowly) agreeing to study repurposed generic medicines. The Food and Drug Administration and the Centers for Disease Control have recommended next to none. Instead, the Biden administration has thrown its political weight almost solely behind mass vaccinations, and hospitals and pharmacies have dogmatically followed suit. But this approach is proving insufficient to arrest COVID-19.

Just look at the evidence on fluvoxamine, a widely used generic antidepressant. A randomized controlled trial (RCT) published in November 2020 showed that the drug led to far less clinical deterioration in treated patients. Another, larger, double-blind RCT, published in The Lancet in October of this year, found fluvoxamine reduced COVID-19 mortality rates by up to 91 percent and hospitalizations by two-thirds. This is an FDA-approved drug. Dosed correctly and for such short periods, it is safe. And it costs about a dollar a pill. These findings have since been further reinforced by another study published by the Journal of the American Medical Association in November, which showed a strong “class effect” of benefits from anti-depressants very similar to fluvoxamine against COVID-19.

Yet, despite the large double-blind, placebo-controlled trial, neither the NIH nor the Infectious Diseases Society of America (IDSA) has arrived at a recommendation for routine use of these drugs to treat COVID-19. The NIH to date has ignored the study. Its last update on fluvoxamine dates back to April, more than seven months ago. More disturbing is the fact that the IDSA recently reviewed this high-quality trial, yet still held fast to its recommendation of “do not use outside of a clinical trial.” Why do repurposed drugs require numerous trials prior to an agency recommendation, while high-profit, novel, patented drugs get routinely approved after only a single trial?

A recent and most brazen example is Merck’s expensive new anti-viral COVID-19 drug, molnupiravir. The FDA rapidly approved it based on a single study of modest benefits in mildly ill outpatients, and the Biden administration swiftly agreed to pay $700 per course of treatment. That was all despite the fact the medicine costs about $20 per course to manufacture, according to a World Health Organization consultant, and may prove less effective or even harmful in practice. With our national debt registering at $2.77 trillion and inflation rampant, building the capacity in our federal government to study cheap, generic medicines would be a smart economic move. But there appears to be no appetite for fiscal prudence or scientific inquiry beyond the expensive, newly minted solutions churned out by our nation’s pharmaceutical industry.

Read more …

“Omicron is ‘markedly resistant’ to all four COVID vaccines and booster shots may only give ‘slight protection’, Columbia University study finds: Day after Fauci said triple-vaxxed should be protected”

Omicron ‘Markedly Resistant’ To All 4 Covid Vaccines (DM)

Columbia University researchers claimed that COVID-19 Omicron is noticeably resistant to vaccines and that boosters sometimes provide only just enough protection, but US COVID tsar Dr. Anthony Fauci insisted booster shots provided adequate coverage. In a study published Wednesday by Dr. David Ho and 20 other researchers, the scientists said that Omicron’s ‘extensive’ mutations can ‘greatly compromise’ all major COVID-19 vaccines – Pfizer, Moderna, Johnson & Johnson and AstraZeneca – even neutralizing them. The report, the first of its kind and conducted along side the University of Hong Kong, also said that while booster shots provided an additional layer of protection, the variant ‘may still pose a risk’ for those who get the third shot.’

The study does not prove booster shots are ineffective, and it comes a day after Fauci said the additional shots work against the Omicron variant and urged Americans to get their third jab. ‘Our booster vaccine regimens work against omicron. At this point, there is no need for a variant-specific booster,’ Fauci said. ‘If you’re unvaccinated, you need to get vaccinated to diminish you’re vulnerability, and if you are vaccinated, get boostered.’ The Columbia University study looked at the effectiveness of each major vaccine against the Omicron variant, finding several cases where they failed to provide the needed protection against infection. While the booster shots proved to be overall consistent, some recorded instanced put it right at the threshold of being fully effective.


‘These findings are in line with emerging clinical data on the Omicron variant demonstrating higher rates of reinfection and vaccine breakthroughs,’ the scientists wrote. ‘Even a third booster shot may not adequately protect against Omicron infection.’ Ho and the Columbia research team said the study delivers a grave warning about the future of COVID and its variants. ‘It is not too far-fetched to think that this [COVID-19] is now only a mutation or two away from being pan-resistant to current antibodies,’ the researchers wrote. ‘We must devise strategies that anticipate the evolutional direction of the virus and develop agents that target better conserved viral elements.’ The new study, however, is out of step with other reports that found three jabs provided sufficient coverage.

Read more …

Drug pushers. And that’s all they are.

EU Agency Backs Pfizer Covid Pill For Emergency Use (Br.)

The EU’s drug regulator on Thursday allowed member states to use Pfizer’s new Covid pill ahead of its formal approval, as an emergency measure to curb an Omicron-fuelled wave. Pills like those by US pharma giant Pfizer and rival Merck have been hailed as groundbreaking because they do not need to be injected or taken intravenously, making them more accessible. Pfizer said this week that its Paxlovid pill reduced hospitalisations and deaths in vulnerable people by almost 90 percent. “The medicine, which is not yet authorised in the EU, can be used to treat adults with Covid-19 who do not require supplemental oxygen and who are at increased risk of progressing to severe disease,” the EMA said in a statement.

“EMA issued this advice to support national authorities who may decide on possible early use of the medicine… for example in emergency use settings, in the light of rising rates of infection and deaths due to Covid-19 across the EU.” Pfizer CEO Albert Bourla said the decision “signifies the strength of our data for Paxlovid in the treatment of high-risk adults diagnosed with Covid-19.” “If authorised, Paxlovid has the potential to help save lives and reduce hospitalisations,” he said in a statement. The Pfizer pill is a combination of a new molecule, PF-07321332, and HIV antiviral ritonavir, that are taken as separate tablets. The Amsterdam-based EMA said it should be taken as soon as possible after a diagnosis and within five days of the start of symptoms, with the treatment lasting five days.

Possible side effects were taste changes, diarrhoea and vomiting. Pregnant women should not use the drug. The EMA said it also launching a “rolling review” of the Pfizer pill that could lead to its full approval in months. Merck’s pill received EMA emergency approval in November. It is already authorised in Britain and is in the process of being approved in the United States. Denmark on Thursday became the first EU country to approve its use.

Read more …

“..Just 20% to 24% of BioNTech vaccine recipients had detectable neutralising antibodies against Omicron..”

Hong Kong Researchers Urge Third Covid-19 Shot After New Omicron Study(R.)

Researchers in Hong Kong have urged people to get a third dose of COVID-19 vaccine as soon as possible, after a study showed insufficient antibodies were generated by the Sinovac (SVA.O) and BioNTech (22UAy.DE) products to fend off Omicron. Tuesday’s release of the results of a study by scientists in the microbiology department of the University of Hong Kong was the first published preliminary data on the impact of Sinovac’s vaccine against the Omicron variant of coronavirus. None of the serum of the 25 Coronavac vaccine recipients contained detectable antibodies that neutralised the new variant, according to the preprint study that has been accepted for publication in the journal Clinical Infectious Diseases, the researchers said.


Just 20% to 24% of BioNTech vaccine recipients had detectable neutralising antibodies against Omicron, the study found. “The public is advised to get a third dose of the vaccine as soon as possible while waiting for the next generation of a more matched vaccine,” the researchers said in a news release. The study, funded by the Hong Kong government, was carried out by microbiologists Yuen Kwok-yung, Kelvin To and Chen Honglin. Sinovac did not immediately respond to questions on the study, but a spokesperson said its own laboratory testing showed a third dose of its vaccine was effective in producing Omicron antibodies.

Read more …

How far away are we from saying the refugees are the lucky ones?

Refugees Lack Covid Shots Because Drugmakers Fear Lawsuits (R.)

Tens of millions of migrants may be denied COVID-19 vaccines from a global programme because some major manufacturers are worried about legal risks from harmful side effects, according to officials and internal documents from Gavi, the charity operating the programme, reviewed by Reuters. Nearly two years into a pandemic that has already killed more than 5 million people, only about 7% of people in low-income countries have received a dose. Vaccine deliveries worldwide have been delayed by production problems, hoarding by rich countries, export restrictions and red tape. Many programmes have also been hampered by hesitancy among the public read more . The legal concerns are an additional hurdle for public health officials tackling the coronavirus – even as officials say unvaccinated people offer an ideal environment for it to mutate into new variants that threaten hard-won immunity around the world.


Many COVID-19 vaccine manufacturers have required that countries indemnify them for any adverse events suffered by individuals as a result of the vaccines, the United Nations says. Where governments are not in control, that is not possible. The concerns affect people, such as those displaced by the Myanmar, Afghanistan and Ethiopian crises, who are beyond the reach of national governments’ vaccination schemes. For refugees, migrants and asylum-seekers, as well as people afflicted by natural disasters or other events that put them out of reach of government help, the global programme known as COVAX created a Humanitarian Buffer – a last-resort reserve of shots to be administered by humanitarian groups. Gavi, the vaccine alliance, is a public-private partnership set up in 2000 to promote vaccination around the world.

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The president of Bayer’s Pharmaceuticals Division.

mRNA Shots Are ‘Gene Therapy’ Marketed As ‘Vaccines’ To Gain Public Trust (LSN)

The president of Bayer’s Pharmaceuticals Division told international “experts” during a globalist health conference that the mRNA COVID-19 shots are indeed “cell and gene therapy” marketed as “vaccines” to be palatable to the public. Stefan Oelrich, president of Bayer’s Pharmaceuticals Division, made these comments at this year’s World Health Summit, which took place in Berlin from October 24-26 and hosted 6,000 people from 120 countries. Oelrich told his fellow international “experts” from academia, politics, and the private sector that the novel mRNA COVID “vaccines” are actually “cell and gene therapy” that would have otherwise been rejected by the public if not for a “pandemic” and favorable marketing.


“We are really taking that leap [to drive innovation] – us as a company, Bayer – in cell and gene therapies … ultimately the mRNA vaccines are an example for that cell and gene therapy. I always like to say: if we had surveyed two years ago in the public – ‘would you be willing to take a gene or cell therapy and inject it into your body?’ – we probably would have had a 95% refusal rate,” stated Oelrich. “Our successes over these 18 months [the duration of the COVID ‘pandemic’] should embolden us to fully focus much more closely on access, innovation and collaboration to unleash health for all, especially as we enter, on top of everything else that is happening, a new era of science – a lot of people talk about the Bio Revolution in this context,” continued the businessman.

Read more …

NIH PubMed, Oct 22 2021.

If the vaccines actually worked, there’d be no need for persuasion.

Persuasive Messaging To Increase Covid-19 Vaccine Uptake Intentions (NIH)

Widespread vaccination remains the best option for controlling the spread of COVID-19 and ending the pandemic. Despite the considerable disruption the virus has caused to people’s lives, many people are still hesitant to receive a vaccine. Without high rates of uptake, however, the pandemic is likely to be prolonged. Here we use two survey experiments to study how persuasive messaging affects COVID-19 vaccine uptake intentions. In the first experiment, we test a large number of treatment messages. One subgroup of messages draws on the idea that mass vaccination is a collective action problem and highlighting the prosocial benefit of vaccination or the reputational costs that one might incur if one chooses not to vaccinate.


Another subgroup of messages built on contemporary concerns about the pandemic, like issues of restricting personal freedom or economic security. We find that persuasive messaging that invokes prosocial vaccination and social image concerns is effective at increasing intended uptake and also the willingness to persuade others and judgments of non-vaccinators. We replicate this result on a nationally representative sample of Americans and observe that prosocial messaging is robust across subgroups, including those who are most hesitant about vaccines generally. The experiments demonstrate how persuasive messaging can induce individuals to be more likely to vaccinate and also create spillover effects to persuade others to do so as well.

Read more …

There is so much more going on than just this. It’s full capture.

Pfizer and Moderna Made Large Dark-money Donations During 2020 Election (Fang)

The representatives of the biopharmaceutical companies behind the Covid-19 vaccines made undisclosed donations to Democratic and Republican campaign organizations last year. The revelations are detailed in the latest tax filings of the Biotechnology Innovation Organization, which lobbies on behalf of Moderna, Pfizer, Johnson & Johnson, and other leading biotech companies involved in the business of treating the Covid-19 virus. BIO has long served as an influential voice for the biotech industry on Capitol Hill and has more recently become the public face of the vaccine industry amid the Covid-19 crisis. But the decision to step up direct contributions to dark-money groups active in the 2020 election reflects a new strategy for BIO, which in previous years only gave to congressional leaders through relatively low-dollar and transparent PAC donations.

The tax disclosure shows that BIO gave $500,000 to Majority Forward, a nonprofit that works to elect Senate Democrats. BIO gave $250,000 to American Bridge 21st Century, a Democratic fact-checking and research website that sponsored campaign advertisements in support of Joe Biden’s presidential campaign and Democrats during the Georgia special election. Neither group discloses donor information. Center Forward, which was instrumental in backing conservative Democrats opposed to broad drug price negotiation policies proposed this year as part of the Build Back Better Act, received $35,000 from BIO. The spending was part of a wave of pharma money entering politics through both lobbying and campaign cash that paid dividends.

After the election, many prominent Democrats, including Rep. Stephanie Murphy of Florida and Rep. Richard Neal of Massachusetts, sided with BIO against proposals to share vaccine intellectual property with low-income countries. More recently, the Build Back Better Act passed by the House contained a watered-down version of the original Democratic proposal for Medicare drug price negotiations. One Nation, the dark-money nonprofit with ties to Sen. Mitch McConnell, R-Ky., received $250,000 from BIO during the election. The group transferred much of its cash to super PACs backing Senate Republicans involved in closely contested races.

The campaign money, undisclosed during the 2020 election, was only made public in the 990 tax form over a year after voters went to the polls. And the true source of the money is still obscured. BIO is funded through annual contributions by biotech companies that use the organization as a veil of anonymity to cloak their political engagement. The group raised over $77 million last year. Johnson & Johnson voluntarily disclosed that it provided at least $500,000 last year to BIO and says that about one-third of its support to the organization goes to lobbying or direct political advocacy. Moderna also voluntarily discloses its support of BIO. John Young, a Pfizer executive, sits on BIO’s board of directors.

Read more …

I’m not sure that shouting “fascist” 20 times a minute at the top of your lungs is the way to go, but he does it…

The Year of the New Normal Fascist (CJ Hopkins)

I don’t need to review the entire year in detail. You remember the highlights … the roll-out of the “safe and effective” miracle “vaccines” that don’t keep you from catching or spreading the virus, and which have killed and injured thousands of people, but which you now have to get every three or four months to be allowed to work or go to a restaurant; the roll-out of the global social-segregation/digital compliance-certificate system that makes absolutely no medical sense, but which the “vaccines” were designed to force us into; The Criminalization of Dissent; The Manufacturing of “Reality”; The Propaganda War; The Covidian Cult; the launch of The Great New Normal Purge; the whole Pathologized Totalitarianism package.

I’d like to end on an optimistic note, because, Jesus, this fascism business is depressing. So I’ll just mention that, as you have probably noticed, more and more people are now “waking up,” or relocating their intestinal fortitude, and finally speaking out against “vaccine” mandates, and “vaccination passes,” and social segregation, and all the rest of the fascist New Normal program. I intend to encourage this “awakening” vociferously. I hope that those — and you know who you are — who have been reporting the facts and opposing the New Normal, and have been ridiculed, demonized, gaslighted, censored, slandered, threatened, and otherwise abused, on a daily basis for 21 months, as our more “prominent” colleagues — and you know who you are — sat by in silence, or took part in the Hate Fest, will join me in applauding and welcoming these “prominent” colleagues to the fight … finally.

Oh, and, if you’re one of those “prominent” colleagues and you start beating your chest and sounding off like you’ve just rediscovered investigative journalism and are now leading the charge against the New Normal for your YouTube viewers or your Substack readers, please understand if we get a little cranky. Speaking for myself, yes, it’s been a bit stressful, doing your job and taking the shit for you out here in the trenches for the past 21 months. Not to mention how it has virtually killed my comedy … and I’m supposed to be a political satirist.

But there I go, getting all “angry” again … whatever. As the doctor said, “buy the ticket, take the ride.” And it’s the season of joy, and love, and forgiveness, and publicly crucifying dissidents, and paranoia, and mass hysteria, and persecuting “Unvaccinated” relatives, and, OK, I might have had one too many. Happy holidays to one and all, except, of course, to the New Normal fascists, especially the ones that are torturing the children. God, forgive me, but I hope they fucking choke.

Read more …

DOA.

Biden’s Build Back Better Bill Suddenly In Serious Danger (Hill)

President Biden’s $2 trillion climate and social spending bill, which appeared to have strong momentum when it passed the House a month ago, now appears to be in real danger of collapsing in the Senate. Democratic senators now concede there is no chance of passing the Build Back Better Act before the end of the year, as they had hoped. A Senate Republican aide on Thursday said that Senate Majority Leader Charles Schumer (D-N.Y.) and Republicans are close to a deal to confirm a bloc of nominees and hold some others over until January, which would clear the Senate calendar for the rest of 2021 and allow senators to go home for Christmas.

But more importantly, there is also a chance the entire Build Back Better bill will have to be reworked to accommodate Sen. Joe Manchin’s (D-W.Va.) opposition to including a one-year extension of the expanded child tax credit in the bill. Manchin says he does not oppose the tax credit, which he has backed in past legislation. But he argues that because the credit is likely to be renewed over the next decade, its true cost is not reflected in the current bill’s official Congressional Budget Office score. The West Virginia senator wants the bill to reflect the 10-year cost of the tax credit, which would require other tax hikes or spending cuts to prevent the official cost of the bill from rising heavily.

With the Senate evenly divided, Democrats acknowledge they can’t move forward without Manchin and the bill will have to wait until 2022. And frustrations are rising. “The situation points out that a 50-50 Senate is really problematic, I’ve used the word sucks. It definitely enables one or two people to hold things up, so yes, I’m frustrated,” Sen. Mazie Hirono (D-Hawaii) told reporters, expressing frustration shared by many Democratic senators over the impasse.

Read more …

“Their whole original case in Westminster Magistrates Court was that Assange isn’t really a journalist and was just engaged in common-or-garden thievery.”

Assange Lost Because The Judges Couldn’t Imagine The US Was Lying (Rees)

The irony is a deep and bitter one. The defeat for Julian Assange’s lawyers in the Court of Appeal proved beyond doubt that their argument is correct. How so? It has always been a central contention of Julian Assange’s defence that the US government is bringing a political prosecution which should be thrown out because the Extradition Act specifically excepts political cases. The US prosecution mob’s lawyer, Jimmy Lewis, and his faithful assistant (Clair) Dobbin, make this point over and over again. Their whole original case in Westminster Magistrates Court was that Assange isn’t really a journalist and was just engaged in common-or-garden thievery. And yet, for all that, here they were in the appeal court relying on those most political of all political things: a diplomatic assurance from a government.

For in the end the whole appeal rested on diplomatic assurances from the US government that they would not subject Julian Assange to life-threatening conditions in a super-max US prison, the very reason why the original Magistrates Court had ruled against extradition earlier this year. To have upheld that refusal to extradite the appeal court judges would have had to said they did not trust the US government’s assurances. It’s not, of course, that the judges couldn’t reach such a view based on the evidence before them. Indeed, all the evidence pointed in that direction. The CIA were revealed, during the appeal, as plotting to either kidnap or kill Assange; the key US witness was revealed as a liar; the ongoing case in Spain has revealed that the CIA spied on Julian Assange, his family and lawyers; the US authorities are impeding that investigation.

These are hardly trust-building actions of a state with Assange’s best interests at heart. And then there’s the fact that the very document which offers the assurances also says that they can be withdrawn at any time. So, all in all, there are many reasons which might have led the judges to conclude that US bagman Jimmy Lewis was offering the court assurances that could not be trusted. The judges took a different view. They took the assurances very seriously. In the gravest and most sonorous tones the appeal court judge stressed how important it was to take US government diplomatic assurances in good faith. They were not something that was lightly given, he intoned, and had to be accepted. As the written judgement says: “There is no reason why this court should not accept the assurances as meaning what they say. There is no basis for assuming that the USA has not given the assurances in good faith.”

Read more …

 

 

 

 

michael breton @michaelpbreton
How is a ‘virus’ with a .00189% worldwide death rate over 2 FUCKING YEARS! even news????

 

 

“Morality is doing what is right regardless of what you are told. Obedience is doing what is told regardless of what is right.”
—H. L. Mencken

 

 

Keep fighting

 

 

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Jan 302017
 
 January 30, 2017  Posted by at 10:15 am Finance Tagged with: , , , , , , , , ,  7 Responses »


Edvard Munch Vampire 1893

Canadian PM Says Québec Mosque Shooting A ‘Terrorist Attack On Muslims’ (R.)
Canada To Offer Temporary Residency To Travelers Stranded By US (R.)
Trump Immigration Order Restricted By More US Judges (R.)
Priebus Says Trump’s Immigration Ban Doesn’t Include Green Card Holders (BBG)
Theresa May Confirms UK Exempt From Trump’s ‘Muslim Ban’ (Ind.)
A Clarifying Moment in American History (Eliot A. Cohen)
US Became A Dumping Ground For The World. No More (CNBC)
The Persuasion Filter and Immigration (Adams)
Theresa May To Warn Devolved Nations: You Have No Veto On Brexit (G.)
UK and EU Heading For Economic Cold War – Italian Foreign Minister (G.)
Eurozone ‘Destruction’ Necessary For Countries To Thrive Again – Stark (Tel.)
The Dollar Will Die With a Whimper, Not a Bang (Rickards)
Dow Companies Report Worst Revenues since 2010, Dow Rises to 20,000 (WS)
Eurozone Bailout Fund Says Greek Public Debt Is ‘Manageable’ (R.)
Turkish Gunboat With Army Chief Sails Into Greek Waters; High Alert (K.)
Greek Fishermen Who Brave The Seas To Rescue Refugees Now Need Saving (NBC)
NASA – 30 Years Of Before And After Images Around The World (F.)

 

 

Be wary of false flags. And ponder how much Canada is ahead of anybody else on immigration.

Canadian PM Says Québec Mosque Shooting A ‘Terrorist Attack On Muslims’ (R.)

Six people were killed and eight wounded when gunmen opened fire at a Quebec City mosque during Sunday night prayers, in what Canadian Prime Minister Justin Trudeau called a “terrorist attack on Muslims”. Police said two suspects had been arrested, but gave no details about them or what prompted the attack. Initially, the mosque president said five people were killed and a witness said up to three gunmen had fired on about 40 people inside the Quebec City Islamic Cultural Centre. Police said only two people were involved in the attack. “Six people are confirmed dead – they range in age from 35 to about 70,” Quebec provincial police spokeswoman Christine Coulombe told reporters, adding eight people were wounded and 39 were unharmed.

The mosque’s president, Mohamed Yangui, who was not inside when the shooting occurred, said he got frantic calls from people at evening prayers. “Why is this happening here? This is barbaric,” he said. Prime Minister Justin Trudeau said in a statement: “We condemn this terrorist attack on Muslims in a center of worship and refuge”. “Muslim-Canadians are an important part of our national fabric, and these senseless acts have no place in our communities, cities and country.” The shooting came on the weekend that Trudeau said Canada would welcome refugees, after U.S. President Donald Trump suspended the U.S. refugee program and temporarily barred citizens from seven Muslim-majority countries from entering the United States on national security grounds.

A Canadian federal Liberal legislator, Greg Fergus, tweeted: “This is an act of terrorism – the result of years of sermonizing Muslims. Words matter and hateful speeches have consequences!” The premier of Quebec province, Philippe Couillard, said security would be increased at mosques in Quebec City and Montreal. “We are with you. You are home,” Couillard said, directing his comments at the province’s Muslim community. “You are welcome in your home. We are all Quebecers. We must continue together to build an open welcoming and peaceful society”.

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Immigration Minister Ahmed Hussen was born in Somalia.

Canada To Offer Temporary Residency To Travelers Stranded By US (R.)

Canada will offer temporary residency to any travelers stranded by U.S. President Donald Trump’s orders temporarily barring people from seven Muslim-majority countries, a senior official said on Sunday. Immigration Minister Ahmed Hussen told a news conference he did not know how many people might be eligible but said only a handful of passengers headed to the United States from Canada had been denied boarding. Trump’s decision on Friday, which also affects refugees, left many people uncertain of whether they could enter the United States. “Let me assure those who may be stranded in Canada that I will use my authority as minister to provide them with temporary residency if they need it,” Hussen said.

Liberal Prime Minister Justin Trudeau’s government has refrained from criticizing the United States, which takes 75% of Canadian exports, preferring instead to stress Canada is open to refugees. “Every country has the right to determine their policies,” said Hussen. The Canadian Council for Refugees and the Canadian Civil Liberties Association, or CCLA, called on Ottawa to withdraw from a Safe Third Country agreement with the United States, under which Canada returns asylum seekers crossing the border. “There’s a danger that the U.S. is doing blanket detentions and deportations … and not honoring asylum claims,” said CCLA Executive Director Sukanya Pillay. Such a move would be diplomatically insulting and Hussen said the pact would remain unchanged for now.

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Many many lawsuits in the pipeline. Attorneys general are getting together to challenge this. Sharp edges are already being blunted.

Trump Immigration Order Restricted By More US Judges (R.)

U.S. judges in at least four states blocked federal authorities from enforcing President Donald Trump’s executive order restricting immigration from seven Muslim-majority countries. Judges in Massachusetts, Virginia and Washington state, each home to major international airports, issued their rulings late Saturday or early Sunday, following an order on Saturday night by U.S. District Judge Ann Donnelly in New York’s Brooklyn borough. Donnelly had ruled in a lawsuit by two men from Iraq being held at John F. Kennedy International Airport. While none of the rulings struck down the executive order, the growing number of orders could complicate the administration’s effort to enforce it. Trump’s order on Friday halted immigration from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen for 90 days, and stopped the resettlement of refugees for 120 days.

The new Republican president said these actions were needed “to protect the American people from terrorist attacks by foreign nationals admitted to the United States.” Condemnation of the order was swift and broad-based. Democratic politicians and civil rights groups weighed in, as well as U.S. allies who view the actions as discriminatory and divisive. Democratic attorneys general from California, New York and other states, meanwhile, were discussing whether to pursue their own legal challenges. The U.S. Department of Homeland Security on Sunday said it “will comply with judicial orders,” while enforcing Trump’s executive order in a manner that ensures those entering the United States “do not pose a threat to our country or the American people.”

Across the United States, lawyers worked overnight to help confused international travelers at airports. Activists and lawyers tracking the arrivals said some Border Patrol agents appeared to be disregarding the various court orders. “There is really no method to this madness,” Becca Heller, director of the New York-based International Refugee Assistance Project organization, told reporters on a conference call.

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Homeland Security Secretary John Kelly has confirmed this.

Priebus Says Trump’s Immigration Ban Doesn’t Include Green Card Holders (BBG)

The White House defended President Donald Trump’s executive order halting entry to the U.S. from seven predominantly Muslim Middle East countries after judges blocked parts of the plan. Republican lawmakers suggested the president’s action was too broad and potentially damaging to the U.S. Trump’s chief of staff said the immigration order doesn’t include holders of green cards, although those people could be subject to additional steps when they travel overseas. A federal judge in Boston became the latest to curb Trump’s immigration order, directing customs officials at the city’s Logan International Airport on Sunday to let passengers from the seven countries with valid visas disembark and go on their way. Trump told his almost 23 million Twitter followers on Sunday morning: “Our country needs strong borders and extreme vetting, NOW. Look what is happening all over Europe and, indeed, the world – a horrible mess!”

[..] The judges’ moves came at the end of a day when a number of students, refugees and dual citizens were stuck overseas or detained, and some businesses, including Google, warned employees from those countries not to risk leaving the U.S. Spontaneous protests erupted at a number of airports around the nation, and world leaders including London’s mayor and Canada’s prime minister joined U.S. lawmakers in crying foul. Although some U.S. visa and green-card holders were blocked from boarding flights to the U.S. on Saturday after the order was issued, “the executive order doesn’t affect green-card holders moving forward,” Reince Priebus, the White House chief of staff, said Sunday on NBC’s “Meet the Press” in what seemed to be an adjustment to the administration’s policy.

He added that green-card holders – legal permanent residents – may be subject to additional screening if they travel to one of the seven countries targeted by the order. Even U.S. citizens may be affected: “I would suspect that if you’re American citizen traveling back and forth to Libya you’re likely to be subjected to further questioning when you come into an airport.,” Priebus said.

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As is Canada.

Theresa May Confirms UK Exempt From Trump’s ‘Muslim Ban’ (Ind.)

Theresa May has confirmed most UK citizens will not be affected by Donald Trump’s “Muslim ban” in a frantic bid to prevent a broad backlash against the policy from damaging her government. Foreign Secretary Boris Johnson sought the clarification in anxious calls to senior figures in Mr Trump’s team, highlighting the political problems the ban was causing Ms May’s administration. The Prime Minister had finally told Mr Johnson and Home Secretary Amber Rudd to “make representations” to their US counterparts, after she initially refused to condemn the ban sparking an angry backlash from her own MPs and others. Her early reluctance to criticise it came after she was the first foreign leader to visit Mr Trump at the White House, where the pair were pictured holding hands and the President delighted Ms May by expressing a desire to sign a quick post-Brexit trade deal with the UK.

The clarification to Mr Trump’s plan to temporarily ban travellers coming into the US from a group of predominantly Muslim countries – Iraq, Iran, Libya, Somalia, Sudan, Syria and Yemen – confirms that the only people affected will be dual citizens of the UK and a listed country, going directly to the US from the listed country. But it is unclear if the move by ministers will be enough to quell anger over the ban, much of which was targeted at its discriminatory nature rather than the effect on Britons alone. As events unfolded on Sunday, Conservatives demanded Mr Trump be forbidden from addressing Parliament on his state visit, Labour and the Lib Dems called for the President to be banned from the country and champion athlete Sir Mo Farah launched an outspoken attack on the ban.

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“..as Lincoln put it, a perpetual story of “a rebirth of freedom”..”

A Clarifying Moment in American History (Eliot A. Cohen)

In an epic week beginning with a dark and divisive inaugural speech, extraordinary attacks on a free press, a visit to the CIA that dishonored a monument to anonymous heroes who paid the ultimate price, and now an attempt to ban selected groups of Muslims (including interpreters who served with our forces in Iraq and those with green cards, though not those from countries with Trump hotels, or from really indispensable states like Saudi Arabia), he has lived down to expectations. Precisely because the problem is one of temperament and character, it will not get better. It will get worse, as power intoxicates Trump and those around him. It will probably end in calamity—substantial domestic protest and violence, a breakdown of international economic relationships, the collapse of major alliances, or perhaps one or more new wars (even with China) on top of the ones we already have.

It will not be surprising in the slightest if his term ends not in four or in eight years, but sooner, with impeachment or removal under the 25th Amendment. The sooner Americans get used to these likelihoods, the better. The question is, what should Americans do about it? To friends still thinking of serving as political appointees in this administration, beware: When you sell your soul to the Devil, he prefers to collect his purchase on the installment plan. Trump’s disregard for either Secretary of Defense Mattis or Secretary-designate Tillerson in his disastrous policy salvos this week, in favor of his White House advisers, tells you all you need to know about who is really in charge. To be associated with these people is going to be, for all but the strongest characters, an exercise in moral self-destruction.

For the community of conservative thinkers and experts, and more importantly, conservative politicians, this is a testing time. Either you stand up for your principles and for what you know is decent behavior, or you go down, if not now, then years from now, as a coward or opportunist. Your reputation will never recover, nor should it. Rifts are opening up among friends that will not be healed. The conservative movement of Ronald Reagan and Jack Kemp, of William F. Buckley and Irving Kristol, was always heterogeneous, but it more or less hung together. No more. New currents of thought, new alliances, new political configurations will emerge. The biggest split will be between those who draw a line and the power-sick—whose longing to have access to power, or influence it, or indeed to wield it themselves—causes them to fatally compromise their values.

For many more it will be a split between those obsessed with anxiety, hatred, and resentment, and those who can hear Lincoln’s call to the better angels of our nature, whose America is not replete with carnage, but a city on a hill. This is one of those clarifying moments in American history, and like most such, it came upon us unawares, although historians in later years will be able to trace the deep and the contingent causes that brought us to this day. There is nothing to fear in this fact; rather, patriots should embrace it. The story of the United States is, as Lincoln put it, a perpetual story of “a rebirth of freedom” and not just its inheritance from the founding generation.

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Isn’t it simply the result of having the reserve currency, though?

US Became A Dumping Ground For The World. No More (CNBC)

America’s shift toward bilateral trade deals shows a total loss of faith in the ability of multilateral forums (G7 … G20) and U.N. agencies (IMF, etc.) to rebalance the world economy through effective international policy coordination. That was long time coming – a sad coda to the global economic (political) and financial order created at the Bretton Woods Conference in July 1944. It is at that time that the economic policy coordination was enshrined as one of the fundamental principles in the IMF’s Articles of Agreement, enjoining both surplus and deficit countries to balance out their external trade positions. What followed – to this day – has been an unending comedy of errors, recriminations and hypocrisy as policy coordination and rules of a sustainable free trade were shunned in pursuit of self-serving national interests.

Predictably, surplus countries refused to adjust (i.e., to reduce their surpluses by running stronger domestic demand to boost imports), extolled their “economic virtue” and continued to live off their trade partners. But deficit countries had no choice; they had to adjust (i.e., to reduce their deficits by shrinking their domestic demand and cutting down their imports) because they ran out of money and had to submit to foreign lenders demanding strict conditions with respect to the timing and magnitude of their trade adjustment. And here is the world we ended up with. Germany is currently running the world’s largest trade surplus of $300 billion. China is not very far behind with a $264 billion surplus. Japan’s $200 billion surplus is rapidly catching up with its large Asian neighbor, and a group of smaller export-driven East Asian countries is showing a steadily rising surplus of $300 billion.

These countries account for 40% of world GDP, but their combined trade surpluses of $1 trillion represent about 80% of the world’s total. In other words, nearly half of the world economy is a drag on the rest of the global demand, output and employment. Do you still wonder why the world economy is stuck in a hopelessly slow lane? With its systematic half-a-trillion dollars of quasi structural trade deficits, the U.S. accounts for 40% of the world’s total (trade deficits) and bears the brunt of what some would call beggar-thy-neighbor trade policies. In a more polished diplomatic “G something” language, you could also call that a “collateral damage” of uncoordinated global economic policies. Damage it is. Over the last two years, these trade deficits have taken an entire percentage point out of America’s sluggish economic growth.

Think also of the huge downward pressure on output and employment these deficits exerted, and continue to exert, in our import-competing industries. And think of this, too. While the surplus countries keep accumulating reserves and net foreign assets by recycling the money we pay for our imports, our trade deficits got us to a huge net foreign debt of $7.8 trillion during the first three quarters of last year – a $1 trillion increase from the same period in 2015. People carping about imaginary trade wars say that this is nothing to worry about. They believe that China, Japan and the rest of “dynamic Asia” will keep lending us the money we pay for their imports, and that they will be happy to hold $2.7 trillion of our IOUs – 46% of the total held by foreign investors – as they did at the end of last November. These, of course, are fairy tales. America’s trade problems are urgent and vitally important policy issues.

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I know people hate him, but he’s interesting.

The Persuasion Filter and Immigration (Adams)

[..] my starting point is the understanding that human brains did not evolve to show us reality. We aren’t that smart. Instead, our brains create little movies in our heads, and yours can be completely different from mine. We see that situation now. Half the country thinks President Trump is well on his way to becoming a Hitler-like dictator. But many other Americans think Trump is an effective business person with good intentions. They can’t both be right. I use the word “filter” to describe an optional way of looking at the world. A good filter is one that makes you happy and does a good job of predicting what happens next. Let’s use that standard to compare the Hitler Filter to what I call the Persuasion Filter. The Hitler filter clearly isn’t making people happy. The people watching that movie are protesting in the streets.

Meanwhile, the people who see Trump as a good negotiator looking out for the country are quite happy with the job he has done so far. The Persuasion Filter says Trump opens with a big first offer and negotiates back to something reasonable. If you don’t recognize the method, it looks crazy, random, and racist. But what about predictions? The Persuasion Filter predicting Trump would become president when the Hitler Filter thought he had no chance. Now we have another chance to test the predictive power of the Persuasion Filter. If Trump is a Master Persuader, as I have been telling you for over a year, he just solved his biggest problem with immigration and you didn’t notice. The biggest problem is that his supporters on the right want more immigration control than he can (or should) deliver while his many critics on the left want far less.

Normally when you negotiate there is only one party on the other side. But in this case, Trump is negotiating two extremes in two different directions. It’s the toughest possible situation. Best case scenario is that 40% of the country want you dead when it’s all over. Not good. So what does a President Trump do when he is in an impossible situation? According to the Hitler Filter, he does more Hitler stuff, such as being more extreme than anyone expected with his recent immigration declarations. That filter accurately predicted that he would be “worse” once elected. Sure enough, his temporary immigration ban is more extreme than most people expected. If things never get worse from this point on, we would have to question the Hitler Filter. But if things get worse still, the Hitler Filter is looking good.

Compare to the Persuasion Filter. This filter says Trump always opens with an extreme first offer so he has room to negotiate to the middle. The temporary ban fits that model perfectly. On the immigration topic alone, both the Hitler Filter and the Persuasion Filter predict that we get to exactly the point we are at today. Let’s call that a tie in terms of predictive power. The hard part is predicting what happens next. The Persuasion Filter says Trump is negotiating with his critics on the extreme right at the same time as he is negotiating with his critics on the left. He needed one “opening offer” that would set up both sides for the next level of persuasion. And he found it. You just saw it.

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Devolved: Scotland, Wales and Northern Ireland. What a mess this is going to be.

Theresa May To Warn Devolved Nations: You Have No Veto On Brexit (G.)

Theresa May is set for a bracing final round of Brexit talks with the leaders of the devolved nations before the likely triggering of article 50, with the prime minister warning her counterparts from Scotland, Wales and Northern Ireland that they can have no veto over the process. May is to see the other leaders in Cardiff on Monday at a meeting of the joint ministerial committee (JMC), the forum for soliciting views from around the UK on the process of leaving the UK. While the first ministers of Scotland and Wales, Nicola Sturgeon and Carwyn Jones, have stressed they cannot accept a hard Brexit without membership of or full access to the EU’s single market, May is set to tell them this will not be possible.

“We will not agree on everything, but that doesn’t mean we will shy away from the necessary conversations and I hope we will have further constructive discussions,” May said in comments released ahead of the meeting. Last week’s supreme court judgment on the need for MPs to vote on triggering article 50 “made clear beyond doubt that relations with the EU are a matter for the UK government and UK parliament”, May said. While the main element of the ruling was to oblige May to put the article 50 process, which will trigger departure from the EU, as a bill to parliament – a subsidiary element of the judge’s decision was that the devolved governments could not veto the process.

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Line of the day: “..We don’t need these kinds of tensions at this time of a geopolitical Jurassic Park..”

UK and EU Heading For Economic Cold War – Italian Foreign Minister (G.)

A senior Italian official has warned that the UK and the European Union are heading into an “economic cold war” over Brexit that could wreak havoc on the west and weaken the continent. Mario Giro, Italy’s deputy foreign minister, said that while many countries in the EU had said the UK’s vote to leave the EU represented a loss to the union, there were more hardliners in the EU against the UK than it appeared. “When we are among the 27 [countries within the EU, not including the UK], the hardliners are more numerous than it appears. I cannot quote a country in particular at the moment. We will see it at the beginning of the negotiation,” Giro said in an interview with the Guardian.

He added: “We are hearing more and more that there are people – economic interests – who are thinking they can inherit some economic position, thinking that they can take away from the UK some of the position of the City of London. Not Italy, of course, because we are not in that position. And this will be an economic war. Let’s say an economic cold war, and we are not in favour of it.” The statement followed remarks this month by the British prime minister, Theresa May, in which she said the UK was prepared for a “hard Brexit” if she could not negotiate a reasonable agreement with the EU over Britain’s departure. She said attempts by other EU countries to wreak vengeance on the UK would be an “act of calamitous self-harm” because the UK in turn would be prepared to radically cut taxes to attract businesses.

Italian officials have always said their top priority in Brexit negotiations would be to guarantee the rights of hundreds of thousands of Italians who lived in the UK. Giro suggested that a coming “battle of interests” – which he described as a competition between economic interests, not necessarily individual states – could have terrible consequences. “This will be a disgrace. To enter into a new era of hard competition on big money questions involving companies, this is very bad for the western world. We don’t need these kinds of tensions at this time of a geopolitical Jurassic Park,” he said, meaning that it was a world where every interest was out for itself.

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Creative destruction.

Eurozone ‘Destruction’ Necessary For Countries To Thrive Again – Stark (Tel.)

The eurozone must break up if its members are to thrive again, according to a former ECB official. Jürgen Stark, who served on the ECB’s executive board during the financial crisis, said it was time to “think the unthinkable” and work towards a “reset” of Europe that pulled power away from Brussels. The former vice-president of Germany’s Bundesbank said the creation of a two-speed eurozone, with France and Germany at its core, would help to ensure the smaller bloc’s survival. “We have to think the unthinkable. And it is already unthinkable to think about the restart of Europe, which means we have to be creative. But in order to be creative, you have to destruct [sic] something.” Mr Stark said countries such as Italy, which has seen its economy stagnate since the crisis, would be better off outside the single currency area.

“Italy was accustomed to this ongoing devaluation of the lira from the mid-Seventies until the late Nineties. Maybe they need devaluation and their own currency in order to become more competitive again,” he said. Speaking at an event organised by ETF Securities, Mr Stark said current accommodative ECB policy meant countries were likely to “muddle through” in the coming years and move closer “by coincidence”. However, he said the eurozone’s problems would resurface, regardless of the political landscape. “In the long run, in the context of a European reset, one has to discuss the issue of whether it is still appropriate to keep these countries with different economic structures and different economic performances together. There is no convergence anymore. “We have had divergence rather than convergence… from the very beginning.”

Mr Stark said Belgium, France, Luxembourg, the Netherlands and Germany “plus Austria and Finland” could form the core of a system with “staggered integration” for other countries such as Italy and Greece. While he described Marine Le Pen’s victory in French elections this year as “unlikely” due to the country’s voting system, Mr Stark said the Front National leader’s victory would also be the catalyst of a eurozone split. Mr Stark, who resigned from the ECB in 2011, said he “blamed” the central bank for allowing countries to drag their heels on reforms. “As long as the ECB gives a signal in its operations to governments that ‘we are the backstop’ and ‘we will prevent country ‘a’ or country ‘b’ from becoming insolvent’ – there will be no structural reforms,” he said.

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A correlation vs causation problem. Where the US was very strong, China is not.

The Dollar Will Die With a Whimper, Not a Bang (Rickards)

[..] the dollar and sterling seesawed over the 20 years following the First World War, with one taking the lead from the other as the leading reserve currency and in turn giving back the lead. In fact, the period from 1919–1939 was really one in which the world had two major reserve currencies — dollars and sterling — operating side by side. Finally, in 1939, England suspended gold shipments in order to fight the Second World War and the role of sterling as a reliable store of value was greatly diminished apart from the U.K.’s special trading zone of Australia, Canada and other Commonwealth nations. The 1944 Bretton Woods conference was merely recognition of a process of dollar reserve dominance that had started in 1914. The significance of the process by which the dollar replaced sterling over a 30-year period has huge implications for you today.

Slippage in the dollar’s role as the leading global reserve currency is not necessarily something that would happen overnight, but is more likely to be a slow, steady process. Signs of this are already visible. In 2000, dollar assets were about 70% of global reserves. Today, the comparable figure is about 62%. If this trend continues, one could easily see the dollar fall below 50% in the not-too-distant future. It is equally obvious that a major creditor nation is emerging to challenge the U.S. today just as the U.S. emerged to challenge the U.K. in 1914. That power is China. The U.S. had massive gold inflows from 1914-1944. Although China’s gold purchases may have fallen off recently, it has been experiencing massive gold inflows. Gold reserves at the People’s Bank of China increased to 1,842 tonnes at the end of 2016, according to the China Gold Association. That’s up 11% from the 1,658 tonnes it held in June, 2015.

But China has acquired thousands of metric tonnes since without reporting these acquisitions to the IMF or World Gold Council. Based on available data on imports and the output of Chinese mines, actual Chinese government and private gold holdings are likely much higher. It’s hard to pinpoint because China operates through secret channels and does not officially report its gold holdings except at rare intervals. China’s gold acquisition is not the result of a formal gold standard, but is happening by stealth acquisitions on the market. They’re using intelligence and military assets, covert operations and market manipulation. But the result is the same. Gold’s been flowing to China in recent years, just as gold flowed to the U.S. before Bretton Woods.

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Get your shades out. The future’s so bright.

Dow Companies Report Worst Revenues since 2010, Dow Rises to 20,000 (WS)

The Dow-20,000 hats have come out of the drawer after an agonizingly long wait that had commenced in early December with the Dow Jones Industrial Average tantalizingly close to the sacred number before the selling started all over again. What a ride it has been. From the beginning of 2011 through January 27, 2017, so a little more than six years, the DJIA has soared 73%, from 11,577 to 20,094. Glorious!! But when it comes to revenues of the 30 Dow component companies – a reality that is harder to doctor than ex-bad-items adjusted earnings-per-share hyped by Wall Street – the picture turns morose. The 30 Dow component companies represent the leaders of their industries. They’re among the largest, most valuable, most iconic American companies. And they’re periodically booted out to accommodate a changed world.

[..] Ah-ha, you say. It’s all the oil bust’s fault. Without the oil companies that have been ravaged by the oil bust, revenues are fine. OK, maybe not fine. Revenues without the oil bust companies are up 13% since 2011. That’s an average annual growth rate of 2.5%, barely above the rate of inflation! But the DJIA hit 20,000 with the oil majors in the average. So in looking at the relationship between aggregate revenues and stock price movements, we need to leave them in the mix. And reality looks even worse. Apple, whose revenues have skyrocketed by over 1,000% since 2006, from $19.3 billion to $216 billion, became a Dow component in 2015, replacing AT&T. And its revenues weren’t part of the 30 Dow components until 2015. So here’s what the aggregate revenues of the Dow components look like without Apple (blue columns) and without Apple but with AT&T (brown columns). A pure stagnation fest:

In both scenarios, revenues in 2016 were lower than they had been in 2008. Only 2009 and 2010 were lower. So in terms of revenues, 2016 was for the Dow components ex-Apple the worst year since 2010! And this despite the five-year binge in acquisitions! So how have the last two years been? Don’t even ask. Of the 30 companies in the Dow, 16 sported declining revenues in 2016. And 17 sported declining revenues over the two-year span since 2014! Only two of them are oil companies! This table shows that inglorious list in all its beauty:

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Deliberate torture in a sort of good cop bad cop routine.

Eurozone Bailout Fund Says Greek Public Debt Is ‘Manageable’ (R.)

Greece’s public debt can be manageable, the eurozone bailout fund said on Sunday, responding to a leaked report by the IMF that the country’s debt will explode to 275% of GDP by 2060. A spokesman for the bailout fund, the European Stability Mechanism (ESM), said the path for Greek public finances agreed between Athens and the eurozone was credible and backed by contingency measures in case of unforeseen events. “We believe that Greece’s debt burden can be manageable, if the agreed reforms are fully implemented, thanks to the ESM’s exceptionally favorable loan conditions over the long term and the recently adopted short-term debt relief measures,” the ESM said. In the document, seen by the Financial Times, the IMF calculated that Greece’s debt load would reach 170% of gross domestic product by 2020 and 164% by 2022.

But it would become explosive thereafter and grow to 275% of GDP by 2060, the paper quoted the report as saying. The spokesman said, however, that the eurozone had promised to offer Greece additional debt relief if Athens delivers on all its reform promises. “As a result, we see no reason for an alarmistic assessment of Greece’s debt situation”. The IMF has long been calling for substantial eurozone debt relief for Athens, but Germany, which faces elections this year, has been strongly opposed to such a move until after 2018, when Greece is to finish all its promised reforms. The IMF assessment of Greek debt developments may make it impossible for the Fund to join the current bailout for Greece, now shouldered only by eurozone governments, because the fund’s policy is to enter programs which in the end allow a country to cope on its own. Eurozone governments want the IMF on board, but do not seem to be ready to provide the debt relief to Greece that is necessary for the Fund to join.

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Incursions into Greek air space have become ‘normal’. Now this. Brussels better act. Or Greece will, at some point. It puts Theresa May’s fast trip to Ankara to sell more weaponry in a bleak light.

Turkish Gunboat With Army Chief Sails Into Greek Waters; High Alert (K.)

The Greek military was on high alert on Sunday after a Turkish gunboat carrying Chief of General Staff Hulusi Akar sailed into Greek waters and around the Imia islets at around 10.30 a.m. The Turkish gunboat was escorted by several assault craft carrying commandos, which also circled the islets that brought Greece and Turkey to the brink of war 21 years ago, almost to the day. Greek authorities responded to what is being viewed as Turkish provocation with warnings and dispatched the Hellenic Navy’s Krataios gunboat, which escorted the Turkish flotilla out of Greece’s territorial waters. Diplomatic officials believe the incident to be a response to a Greek Supreme Court ruling last week rejecting a request from Ankara for the extradition of eight Turkish servicemen accused of taking part in failed coup last summer. Turkish military authorities released photographs showing Akar on the gunboat, with Imia in the background.

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Bless their souls.

Greek Fishermen Who Brave The Seas To Rescue Refugees Now Need Saving (NBC)

At the height of the refugee crisis in Sept. 2015, the 63-year-old Marmarinos and the rest of the village’s fishermen gave up working to spend months saving families from the rough, cold waters. Many of them were seeking safety from the bombs falling on Syria. “Mothers, pregnant women, children,” Marmarinos recalled. “So many children, all in the waters, wet, in a horrible situation.” Pideris, 40, says the fishermen risked their own lives “because it was the humane thing to do.” He said refugees and migrants “would fall overboard, they didn’t know how to navigate, boats were left adrift, they’d lose their engines, they’d break apart and the sea would fill with people.” But today, it’s Pideris and Marmarinos who need help after a winter storm on January 9 dropped nearly two feet of snow in their village. The boat canopies couldn’t take the weight and capsized while tied up in the harbor.

The boats are the pair’s sole sources of income. Pideris said he was in shock. “I’ve been in danger at sea, fishing and helping refugees, and my boat sinks in the safety of the harbor,” he said. “My brain stopped. My heart stopped. I was the living dead.” Both vessels sat in the corrosive sea water for three days, until the roads cleared enough to bring in a crane. The electronics and engines on both vessels were destroyed and require thousands of dollars in repairs. The mayor of Lesbos says money from a humanitarian award — the Olof Palme prize, which given to the islanders for embracing migrants – will go toward the cost of repairs. Marmarinos says he’s proud “because I offered help and I see it’s coming back to me … Even if no one helped I’d still be proud and if it happens again, I’d do the same.” Marmarinos and Pideris hope to be fishing again by early next month.

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I think that’s the clearest picture of what has happened to Arctic sea ice that I’ve seen.

NASA – 30 Years Of Before And After Images Around The World (F.)

The Arctic’s sea ice has been in decline for decades as pictured above comparing September 1984 to September 2016. The total area of persistent (4 years or older) ice has declined from 718,000 square miles to 42,000 square miles in the time period above. In the above images blue/grey ice is younger whereas white ice is older.

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Sep 272016
 
 September 27, 2016  Posted by at 8:32 am Finance Tagged with: , , , , , , , , , ,  1 Response »


Arnold Genthe “Chinatown, San Francisco. The street of the gamblers at night” 1900

Why I Switched My Endorsement from Clinton to Trump (Scott Adams)
When America Was Great, Taxes Were High, Unions Strong, and Government Big (A.)
Global Debt Reaches Fresh High As Companies And Countries Keep Borrowing (Tel.)
When Small Is Evil (DQ)
Structural Growth and Dope Dealers on Speed-Dial (Hussman)
Treasury Market’s Biggest Buyers Are Selling as Never Before (BBG)
Deutsche Bank Crisis Could Take Angela Merkel Down – And The Euro (Tel.)
China’s Runaway Housing Market Poses Latest Challenge for Yuan (BBG)
Sydney Home Prices Need To Drop 25% To Help First Time Buyers (Abc)
Don’t Blame “Baby Boomers” For Not Retiring – They Can’t Afford To (Roberts)
Saudi Lobbyists Plot New Push Against 9/11 Bill As Veto Override Looms (Pol.)
Over 90% Of World Breathing Bad Air-WHO (AFP)
Canadians Are Embracing Syrian Refugees. Why Can’t We? (G.)

 

 

The most interesting and thought-provoking thing I’ve read about the election amidst a river of blubber.

Why I Switched My Endorsement from Clinton to Trump (Scott Adams)

5. Pacing and Leading: Trump always takes the extreme position on matters of safety and security for the country, even if those positions are unconstitutional, impractical, evil, or something that the military would refuse to do. Normal people see this as a dangerous situation. Trained persuaders like me see this as something called pacing and leading. Trump “paces” the public – meaning he matches them in their emotional state, and then some. He does that with his extreme responses on immigration, fighting ISIS, stop-and-frisk, etc. Once Trump has established himself as the biggest bad-ass on the topic, he is free to “lead,” which we see him do by softening his deportation stand, limiting his stop-and-frisk comment to Chicago, reversing his first answer on penalties for abortion, and so on.

If you are not trained in persuasion, Trump looks scary. If you understand pacing and leading, you might see him as the safest candidate who has ever gotten this close to the presidency. That’s how I see him. So when Clinton supporters ask me how I could support a “fascist,” the answer is that he isn’t one. Clinton’s team, with the help of Godzilla, have effectively persuaded the public to see Trump as scary. The persuasion works because Trump’s “pacing” system is not obvious to the public. They see his “first offers” as evidence of evil. They are not. They are technique. And being chummy with Putin is more likely to keep us safe, whether you find that distasteful or not. Clinton wants to insult Putin into doing what we want. That approach seems dangerous as hell to me.

6. Persuasion: Economies are driven by psychology. If you expect things to go well tomorrow, you invest today, which causes things to go well tomorrow, as long as others are doing the same. The best kind of president for managing the psychology of citizens – and therefore the economy – is a trained persuader. You can call that persuader a con man, a snake oil salesman, a carnival barker, or full of shit. It’s all persuasion. And Trump simply does it better than I have ever seen anyone do it. The battle with ISIS is also a persuasion problem. The entire purpose of military action against ISIS is to persuade them to stop, not to kill every single one of them. We need military-grade persuasion to get at the root of the problem. Trump understands persuasion, so he is likely to put more emphasis in that area.

Most of the job of president is persuasion. Presidents don’t need to understand policy minutia. They need to listen to experts and then help sell the best expert solutions to the public. Trump sells better than anyone you have ever seen, even if you haven’t personally bought into him yet. You can’t deny his persuasion talents that have gotten him this far. In summary, I don’t understand the policy details and implications of most of either Trump’s or Clinton’s proposed ideas. Neither do you. But I do understand persuasion. I also understand when the government is planning to confiscate the majority of my assets. And I can also distinguish between a deeply unhealthy person and a healthy person, even though I have no medical training. (So can you.)

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The Dream ended decades ago, it’s just a matter of picking which decade.

When America Was Great, Taxes Were High, Unions Strong, and Government Big (A.)

There is plenty about GOP hopeful Donald Trump to which potential primary voters respond. He’s successful. He’s plainspoken. At a time when politicians are historically unpopular, he’s not a politician. And he has a great slogan. That slogan resonates with his supporters, according to Republican pollster Frank Luntz, who ran a recent focus group, the results of which were written about in Time. “I used to sleep on my front porch with the door wide open, and now everyone has deadbolts,” one man told Luntz. “I believe the best days of the country are behind us.” Luntz concluded that people see Trump as a “real-deal fixer-upper,” able to make repairs that others have bungled. “We know his goal is to make America great again,” one woman astutely observed. “It’s on his hat.”

It could be on your hat too—Trump has begun selling “Make America Great Again” merchandise—if you can find one, that is. They have a tendency to sell out. As Russell Berman pointed out in The Atlantic earlier this month, many white Americans these days are pessimistic to the point of despair: “White Americans—and in particular those under 30 or nearing retirement age—have all but given up on the American Dream. More than four out of five younger whites, and more than four out of five respondents between the ages of 51 and 64 said The Dream is suffering.” No wonder Trump’s message is so powerful—it’s a sugar pill coated with nostalgia. He is not promising to make America great, he’s promising to make it great again. But to what era does he intend to take the nation back?

And what would that look like, practically speaking? The boundaries of America’s “golden age” are clear on one end and fuzzy on the other. Everyone agrees that the midcentury boom times began after Allied soldiers returned in triumph from World War II. But when did they wane? The economist Joe Stiglitz, in an article in Politico Magazine titled “The Myth Of The American Golden Age,” sets the endpoint at 1980, a year until which “the fortunes of the wealthy and the middle class rose together.” Others put the cut-off earlier, at the economic collapse of 1971 and the ensuring malaise. Regardless of when it ended, it would not be unfair to use the ’50s as shorthand for this now glamorized period of plenty, peace, and the kind of optimism only plenty and peace can produce.

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Ever more debt is the only way to keep the facade upright enough that people believe in it.

Global Debt Reaches Fresh High As Companies And Countries Keep Borrowing (Tel.)

Global debt issuance is on course to hit a record high in 2016 as figures showed sales this year topped $5 trillion (£3.9 trillion) at the end of September. Debt issuance rose to $5.02 trillion in the nine months to September 22, according to Dealogic, putting 2016 on course to beat the all-time high of $6.6 trillion recorded in 2006. Record low interest rates have encouraged countries and companies to issue debt as central banks around the world try to stimulate growth. The data also showed corporate issuance of investment-grade debt reached a record high of $1.54 trillion since the start of the year, up from $1.41 trillion in the same period a year earlier. Dealogic’s figures also highlighted the impact of the Brexit vote.

Sterling-denominated investment grade debt rose to $21.3bn in the first nine months of the year, up slightly from $20.9bn raised in the same period of 2015. Volumes in July fell to their lowest since 2000 as the referendum result slowed issuance, with just $564m issued, according to Dealogic. However, issuance is expected to pick up later this year following the Bank of England’s decision to buy £10bn of corporate debt as part of its revamped bond-buying programme. Sterling issuance in August jumped to six times the average following the Bank’s announcement. Green bonds – which raise money for environmentally friendly projects and often carry tax exemptions – are also rising in popularity.

Activity surpassed full-year 2015 levels in September as volumes reached a record high, worth $48.2bn. Mark Carney, the Governor of the Bank of England, has spoken out in favour of green finance, describing it as a “major opportunity” for investors. In a speech last week, he said long-term financing of green projects in emerging markets could help to promote financial stability. “By ensuring that capital flows finance long-term projects in countries where growth is most carbon intensive, financial stability can be promoted,” he said. More than $13 trillion of global sovereign and corporate debt trades at negative yields, highlighting the influence of central banks.

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Draghi’s comments on small banks remind me of Ken Rogoff’s war on cash.

When Small Is Evil (DQ)

There are plenty of reasons to be worried about the state of Europe these days, but if one had to choose one thing above all others, it would be the gaping disconnect between reality and senior European policy makers’ willful misperception of reality. A perfect case in point was a speech given in Frankfurt by ECB president Mario Draghi. He was addressing a conference of the European Systemic Risk Board (ERSB), an organization created in 2010 by the European Commission to warn about and mitigate systemic financial risks in Europe. During his address Draghi discussed what he saw as the biggest threats to Europe’s financial system.

Just as you’d expect from any senior central banker worth his or her salt, he did not point to the most obvious risk: the zombifying banks at the very top of the financial food chain — the same banks that coincidentally constitute the ECB’s number-one constituency and whose balance sheets are still filled to the rafters with toxic assets dating back to even before the last major crisis, in 2008. By now, virtually all of these banks are fully dependent on the never-ending and ever-growing welfare assistance provided by the ECB. Nor did Draghi mention the excessive complexity and interconnectedness of the banking system, routinely fingered as potential causes of the next global financial crisis.

Nor for that matter did he mention the destructive side effects of the ECB’s negative interest rate policy (NIRP), which – besides sacrificing millions of savers and retirees via their pension funds on the altar of rampant debt creation and completely undermining the crucial micro-economic role played by capital formation – is making it difficult for Europe’s largest banks to turn a meaningful profit. No, for Draghi, the biggest financial problem in Europe these days is that it is over-banked. “Over-capacity in some national banking sectors, and the ensuing intensity of competition, exacerbates this squeeze on margins,” he said. Put simply, there’s just too much competition from the thousands of smaller banks that are crowding out the profits for the big banks.

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“The weakness in real GDP growth is of greatest concern, because it’s largely the consequence of policies that encourage repeated cycles of bubbles and collapses..”

Structural Growth and Dope Dealers on Speed-Dial (Hussman)

In recent years, the U.S. equity market has scaled the third steepest cliff in history, eclipsed only by the 1929 and 2000 peaks, as investors rest their full confidence and weight on the protrusions of a structurally deteriorating economy, imagining that they are instead the footholds of a robust investment environment. The first of these is the current environment of low interest rates. While investors take this as quite a positive factor, it’s largely a reflection of a steep downturn in U.S. structural economic growth, magnified by reckless monetary policy. Over the past decade, the average annual nominal growth rate of GDP has dropped to just 2.9%, while real GDP growth has plunged to just 1.3%; both the lowest growth rates in history, outside of the Depression (see the chart below).

Indeed, probably the most interesting piece of information from last week’s FOMC meeting was that the Federal Reserve downgraded its estimate for the central tendency of long-run GDP growth to less than 2% annually. The weakness in real GDP growth is of greatest concern, because it’s largely the consequence of policies that encourage repeated cycles of bubbles and collapses, and chase debt-financed consumption instead of encouraging productive real investment. Indeed, growth in real U.S. gross domestic investment has collapsed since 2000 to just one-fifth of the rate it enjoyed in the preceding half-century, and has averaged zero growth over the past decade. While labor force growth has slowed, it’s really the self-inflicted collapse of U.S. productivity growth, enabled by misguided policy, that’s at the root of the problem.

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This is some investing tactic anymore. It’s about parties needing cash.

Treasury Market’s Biggest Buyers Are Selling as Never Before (BBG)

They’ve long been one of the most reliable sources of demand for U.S. government debt. But these days, foreign central banks have become yet another worry for investors in the world’s most important bond market. Holders like China and Japan have culled their stakes in Treasuries for three consecutive quarters, the most sustained pullback on record, based on the Federal Reserve’s official custodial holdings. The decline has accelerated in the past three months, coinciding with the recent backup in U.S. bond yields. For Jim Leaviss at M&G Investments in London, that’s cause for concern. A continued retreat could lead to painful losses in a market that some say is already too expensive.

But perhaps more important are the consequences for America’s finances. With the U.S. facing deficits that are poised to swell the public debt burden by $10 trillion over the next decade, foreign demand will be crucial in keeping a lid on borrowing costs, especially as the Fed continues to suggest higher interest rates are on the horizon. The selling pressure from central banks is “something you have to bear in mind,” said Leaviss, whose firm oversees about $374 billion. “This, as well as the Fed, all means we are nearer to the end of the low-yield environment.” Overseas creditors have played a key role in financing America’s debt as the U.S. borrowed heavily in the aftermath of the financial crisis to revive the economy.

Since 2008, foreigners have more than doubled their investments in Treasuries and now own about $6.25 trillion. Central banks have led the way. China, the biggest foreign holder of Treasuries, funneled hundreds of billions of dollars back into the U.S. as its export-based economy boomed. Now, that’s all starting to change. The amount of U.S. government debt held in custody at the Fed has decreased by $78 billion this quarter, following a decline of almost $100 billion over the first six months of the year. The drop is the biggest on a year-to-date basis since at least 2002 and quadruple the amount of any full year on record, Fed data show.

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“No one really knows where the losses would end up, or what the knock-on impact would be. It would almost certainly land a fatal blow to the Italian banking system, and the French and Spanish banks would be next.”

Deutsche Bank Crisis Could Take Angela Merkel Down – And The Euro (Tel.)

True, Merkel’s position is understandable. The politics of a Deutsche rescue are terrible. Germany, with is Chancellor taking the lead, has set itself up as the guardian of financial responsibility within the euro-zone. Two years ago, it casually let the Greek bank system go to the wall, allowing the cash machines to be closed down as a way of whipping the rebellious Syriza government back into line. This year, there has been an unfolding Italian crisis, as bad debts mount, and yet Germany has insisted on enforcing euro-zone rules that say depositors – that is, ordinary people – have to shoulder some of the losses when a bank is in trouble. For Germany to then turn around and say, actually we are bailing out our own bank, while letting everyone else’s fail, looks, to put it mildly, just a little inconsistent.

Heck, a few people might even start to wonder if there was one rule for Germany, and another one for the rest. In truth, it would become impossible to maintain a hard-line in Italy, and probably in Greece as well. And yet, if Deutsche Bank went down, and the German Government didn’t step in with a rescue, that would be a huge blow to Europe’s largest economy – and the global financial system. No one really knows where the losses would end up, or what the knock-on impact would be. It would almost certainly land a fatal blow to the Italian banking system, and the French and Spanish banks would be next. Even worse, the euro-zone economy, with France and Italy already back at zero growth, and still struggling with the impact of Brexit, is hardly in any shape to withstand a shock of that magnitude.

A rock and a hard place are hardly adequate to describe the options Merkel may soon find herself facing. The politics of a rescue are terrible, but the economics of a collapse are even worse. By ruling out a rescue, she may well have solved the immediate political problem. Yet when the crisis gets worse, as it may do at any moment, it is impossible to believe she will stick to that line. A bailout of some sort will be cobbled together – even if the damage to Merkel’s already fraying reputation for competence will be catastrophic. In fact, Merkel is playing a very dangerous game with Deutsche – and one that could easily go badly wrong. If her refusal to sanction a bail-out is responsible for a Deutsche collapse that could easily end her Chancellorship. But if she rescues it, the euro might start to unravel.

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Beijing purposely blows a giant bubble with money people don’t have.

China’s Runaway Housing Market Poses Latest Challenge for Yuan (BBG)

Here’s the latest uncertainty facing China’s currency: sky high house prices. A runaway boom in the largest cities will push investors to look for cheaper alternatives overseas, draining money out of China and putting downward pressure on the yuan in the process, according to analysis by Harrison Hu at Royal Bank of Scotland in Singapore. An “enlarged differential between domestic and foreign asset prices will lead to capital outflows and depreciation, until parity is restored,” Hu wrote in a note. He said that the 30% year-on-year price gain in Tier 1 and leading Tier 2 cities implies a 25% rise in dollar terms, which far outpaces the 5% gain in major U.S. cities. That ratio is here in red:

“It’s commonly believed that China’s policymakers will sacrifice the yuan exchange rate to avoid a sharp correction in domestic property prices, as the latter will more significantly derail China’s economy and the financial system,” Hu wrote. That’s because the importance of the property market in the world’s second largest economy far outweighs many sectors, including the stock market. Hu compares property as a percentage of economic output to the far lighter footprint of stocks. A real estate crash in China could have far reaching consequences and it would be a long time before investors regained their confidence, according to Hu.

That will put policy makers in a very difficult position. While the government has some cards in its hand, such as an ability to control land supply and enforce curbs on new home-buying, history shows that some tightening measures risk backfiring and only stoking speculative behavior such as “panic buying” like that seen in Shanghai earlier this year. Besides, the regulator’s handling of last year’s stock market turmoil did little to inspire confidence in the government’s ability to oversee the bubbly housing market. “No bubble has a happy ending,” Hu wrote.

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Someone should calculate the losses at a 25% price drop. And do 50% too. Losses for ‘owners’ and for lenders.

Sydney Home Prices Need To Drop 25% To Help First Time Buyers (Abc)

First home buyers are facing the biggest barrier in recent history to entering the housing market, with deposits at record high levels relative to incomes in the Sydney market. Research by Deutsche Bank’s chief Australian economist Adam Boyton shows it would take a 25% drop in Sydney home prices to bring the size of deposit required back to average levels over the past 20 years. Mr Boyton studied the Sydney market because it is the biggest, has seen rapid recent price growth and has the highest housing costs in the nation. In contrast to the record deposit needed – now estimated to be almost twice the typical annual earnings of a Sydney household – rising incomes over the early 2000s and falling interest rates since the global financial crisis have seen the burden of mortgage repayments remain comparatively stable relative to income.

Mr Boyton expresses this as “borrowing power”, which has broadly increased in line with Sydney home prices, albeit with prices jumping ahead somewhat during the most recent boom. At the low point in 2003, a Sydney household with a typical income could only borrow half what a typical house cost if their repayments were to be 30% of their gross incomes. At the best points for affordability, households could comfortably afford to borrow between 60-68% of the typical Sydney house price. Currently that figure is just over 50%.

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An epic clash unfolds before our eyes.

Don’t Blame “Baby Boomers” For Not Retiring – They Can’t Afford To (Roberts)

In business, the 80/20 rule states that 80% of your business will come from 20% of your customers. In an economy where more than 2/3rds of the growth rate is driven by consumption, an even bigger imbalance of the “have” and “have not’s” presents a major headwind. I have often written about the disconnect between Wall Street and Main Street. As shown in the chart below, while asset prices were inflated by continued interventions of monetary policy from the Federal Reserve, it only benefited the small portion of the population with assets invested in the market.

Cheap debt, excess liquidity and a buyback spree, led to soaring Wall Street and corporate profits, surging executive compensation and rising incomes for those in the top 10%. Unfortunately, the other 90% known as “Main Street” did not receive many benefits. This divide is clearly seen in various data and survey statistics such as the recent survey from National Institute On Retirement Security which showed the typical working-age household has only $2500 in retirement account assets. Importantly, “baby boomers” who are nearing retirement had an average of just $14,500 saved for their “golden years.”

[..] The gap between the young and elderly population has shrunk dramatically in recent years as the demographic trends have shifted. Old people are living longer and young people are delaying marriage and children. This means fewer people paying into a social welfare system, while more or taking out. Of course, the burden on the social safety net remains the 800-lb gorilla in the room no one wants to talk about. But with the insolvency of the welfare system looming in less than a decade, I am sure it will become a priority soon enough.

Of course, as we will discuss in a moment, the problem is that while the “baby boom” generation may be heading towards retirement years, there is little indication a large majority of them will be actually retiring. With a large majority of individuals being dependent on the welfare system in retirement, the burden will fall on those next in line. Welcome to the “sandwich generation” when more individuals will be “sandwiched” between supporting both parents and children in the same household. It should be no surprise multi-generational households in the U.S. are at their highest levels since the “Great Depression.”

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Obama’s fist veto override?

Saudi Lobbyists Plot New Push Against 9/11 Bill As Veto Override Looms (Pol.)

Saudi Arabia is mounting a last-ditch campaign to scuttle legislation allowing families of victims of the Sept. 11, 2001 attacks to sue the kingdom — and they’re enlisting major American companies to make an economic case against the bill. General Electric, Dow Chemical, Boeing and Chevron are among the corporate titans that have weighed in against the Justice Against Sponsors of Terrorism Act, or JASTA, which passed both chambers unanimously and was vetoed on Friday, according to people familiar with the effort. The companies are acting quietly to avoid the perception of opposing victims of terrorism, but they’re responding to Saudi arguments that their own corporate assets in the kingdom could be at risk if the law takes effect.

Meanwhile, Trent Lott, the former Senate majority leader who now co-leads Squire Patton Boggs’ lobbying group, e-mailed Senate legislative directors on Monday warning that the bill could lead other countries to withdraw their assets from the United States and retaliate with laws allowing claims against American government actions. “Many foreign entities have long-standing, intimate relations with U.S. financial institutions that they would undoubtedly unwind, to the further detriment of the U.S. economy,” reads one of the attachments, obtained by POLITICO. “American corporations with interests abroad may be at risk of retaliation, a possibility recently expressed by GE and Dow.” Still, the Saudis and their agents face a significant uphill battle, with lawmakers loath to take a vote against victims of the 9/11 attacks right before an election.

There was little public opposition to the bill as it made its way through the Capitol, and even now, efforts to tweak the bill haven’t caught much traction. Senate Majority Leader Mitch McConnell (R-Ky.) announced Monday that the Senate will vote Wednesday on a motion to override President Barack Obama’s veto, and if override advocates are successful there, the House will take the same vote Thursday or Friday, a House Republican leadership aide said. But even if Obama receives the first veto override of his presidency, the story won’t end there: the Saudis will seek a new bill to scale back the law in the lame-duck session or in the next session, after lawmakers are relieved from the heat of the campaign, people familiar with the plans said. “It’s Washington at its finest,” one of the people said.

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How to kill off your own species.

Over 90% Of World Breathing Bad Air-WHO (AFP)

Nine out of 10 people globally are breathing poor quality air, the World Health Organization said Tuesday, calling for dramatic action against pollution that is blamed for more than six million deaths a year. New data in a report from the UN’s global health body “is enough to make all of us extremely concerned,” Maria Neira, the head of the WHO’s department of public health and environment, told reporters. The problem is most acute in cities, but air in rural areas is worse than many think, WHO experts said. Poorer countries have much dirtier air than the developed world, according to the report, but pollution “affects practically all countries in the world and all parts of society”, Neira said in a statement. “It is a public health emergency,” she said.

“Fast action to tackle air pollution can’t come soon enough,” she added, urging governments to cut the number of vehicles on the road, improve waste management and promote clean cooking fuel. Tuesday’s report was based on data collected from more than 3,000 sites across the globe. It found that “92% of the world’s population lives in places where air quality levels exceed WHO limits”. The data focuses on dangerous particulate matter with a diameter of less than 2.5 micrometres, or PM2.5. PM2.5 includes toxins like sulfate and black carbon, which can penetrate deep into the lungs or cardiovascular system. Air with more than 10 microgrammes per cubic metre of PM2.5 on an annual average basis is considered substandard.

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Funny little story against a very serious backdrop.

Canadians Are Embracing Syrian Refugees. Why Can’t We? (G.)

Nobody warned the Hendawis about Canadian girls. Wadah and Raghdaa Hendawi survived the civil war in Syria, fleeing the devastation of Aleppo with their children for the relative safety of Lebanon. For three years their teenage sons missed out on an education while they worked to support the family. Then they hit the immigration jackpot – Canada. They were greeted at Halifax airport not by immigration officials or social workers, but by their sponsors – a bunch of well-meaning locals whose fundraising efforts would support the family for the next 12 months. And so the Hendawis arrived in the small fishing town of Shelburne, Nova Scotia, swaddled in new ski jackets, blinded by the winter sunshine bouncing off fresh February snow.

They were the only Syrians in the village, and had no idea what was in store for them. The Rev. Joanne McFadden knew the names and ages of the family she was helping to sponsor, but apart from that she too didn’t know what to expect. She certainly wasn’t prepared for the phone call that came three days after Saed (18), Mohamad (16) and Ahmed (15) started attending Shelburne Regional High School. I get a phone call from the principal. ‘Uhhh, Joanne, we have a problem.’ ‘What’s the problem, Mary?’ ‘Well, all the girls in the school are chasing the boys.’ This hadn’t even crossed our mind, right, that this was even a possibility. It was like, pardon me, we’ve got some things to figure out.

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