Jean-Francois Millet The Young Shepherdess 1870-73
Iran remembers the sjah, and US involvement in his reign, and the Savak. Americans forget at their own peril. Painting Iran as the aggressor while siding with the Saudi’s against it is not 100% credible, to say the least.
Iran’s President Hassan Rouhani said the Islamic republic “will proudly bypass sanctions” by the United States that took effect on Monday targeting the country’s oil and financial sectors. “I announce that we will proudly bypass your illegal, unjust sanctions because it’s against international regulations,” Rouhani said in a televised speech. “We are in a situation of economic war, confronting a bullying power. I don’t think that in the history of America, someone has entered the White House who is so against law and international conventions,” he added. The measures described by Washington as “the toughest sanctions ever” follow US President Donald Trump’s controversial decision in May to abandon the multi-nation nuclear deal with Tehran.
The latest tranche aim to significantly cut Iran’s oil exports – which have already fallen by around one million barrels a day since May – and cut it off from international finance. The United States has given temporary exemptions to eight countries – including India, Japan and Turkey – to continue buying oil in a bid to avoid disturbing their economies and global markets. But US Secretary of State Mike Pompeo vowed to push Iran’s oil sales to zero. “Watch what we do. Watch as we’ve already taken more crude oil off the market than any time in previous history,” he told CBS’s “Face the Nation” on Sunday.
Iranian General Qasem Soleimani posted this
Clear and concise.
China said on Monday its lawful trade cooperation with Iran should be respected and expressed regret that the United States re-imposed sanctions on the Middle Eastern country. Speaking at a daily news briefing in Beijing, foreign ministry spokeswoman Hua Chunying did not directly comment on whether China had been granted exemption from the Iran sanctions by the United States. The restoration of U.S. sanctions on Monday targeting Iran’s oil sales and banking sector is part of an effort by U.S. President Donald Trump to force Iran to halt its nuclear and ballistic missile programmes outright, as well as its support for proxy forces in conflicts across the Middle East.
“The UAE and Saudi Arabia will be destroyed in 60 minutes. After 90 minutes the U.S. will have nothing in this country. And we haven’t even started with Israel. Beware of the day we go after Israel, too.”
Powerful Shia cleric Ayatollah Ahmad Alamolhoda is the Friday Prayer leader in Mashhad, considered Iran’s spiritual capital and among the holiest places in Shia Islam, and sits on the government’s “Assembly of Experts” but has no formal government role or decision-making ability. However, he’s a powerful leader and chief spiritual force behind Iran’s conservative faction who has long been at odds with President Hassan Rouhani. Iranian opposition sources report that Alamolhoda told his followers during his Friday prayer sermon: “If we reach a point that our oil is not exported, the Strait of Hormuz will be mined. Saudi oil tankers will be seized and regional countries will be leveled with Iranian missiles.”
The cleric is further reported to have declared that Iran has the power to “instantly” create conditions for $400 a barrel oil prices if it decides to act in the Persian Gulf. He said as reported in regional opposition media: “If Iran decides, a single drop of this region’s oil will not be exported and in 90 minutes all Persian Gulf countries will be destroyed. The UAE and Saudi Arabia will be destroyed in 60 minutes. After 90 minutes the U.S. will have nothing in this country. And we haven’t even started with Israel. Beware of the day we go after Israel, too. That’s why they want us to round up our missiles.”
“General Qassem Soleimani has said to President Hassan Rouhani: “You walk and we stand ahead of you. Don’t respond to Trump’s provocations because he is insolent and not at your level. I shall face him myself“
Today the harshest and highest level economic and energy sanctions that can be imposed on any country are being imposed unilaterally on Iran. The US establishment will try its best to bring the Islamic Republic to its knees and Tehran will do its best to cross the US minefield. Whatever the outcome, Iran will never submit to Washington’s twelve conditions.Iran is not a fledgeling country ready to collapse at the imposition of the first tight sanctions, nor will Iran allow its oil exports to be frozen without reacting. In fact, US and UN sanctions against Iran date to the beginning of the Islamic Revolution and the fall of the Shah in 1979.No doubt the Iranian economy will be affected. Nevertheless, Iranian unity today has reached new heights.
President Trump has managed to bring reformists and radicals together under the same umbrella! Iranian General Qassem Soleimani has said to President Hassan Rouhani: “You walk and we stand ahead of you. Don’t respond to Trump’s provocations because he is insolent and not at your level. I shall face him myself”. Rouhani believes “US policy and its new conspiracy will fail”. All responsible figures in the Iranian regime are now united under the leadership of Imam Ali Khamenei against the US policy whose aim is to curb the regime. Under the previous worldwide sanctions regime, Iran began developing missile technology and precision weapons. Iran has never yielded in support of its allies because these alliances are an integral part of its ideology.
Today, Tehran is not standing alone against the US and is waiting to see what course global sanctions will take before reacting. Officials in Tehran, convinced that Trump will win a second term, are preparing for a long siege. Sayyed Ali Khamenei said his country will never strike any deal with the US and won’t be a party to any future agreement because the US is fundamentally untrustworthy. Iran relies on the unity of its own citizens and on the support of its partners in the Middle East, Europe (a crucial strategic ally), and Asia.
End the Fed. Is that Trump’s endgame?
[..] perhaps the president’s goal is not to subtly affect Fed behavior so much as to make it patently obvious who is to blame when the next Great Recession hits. And recession is fairly certain to hit, because higher interest rates almost always trigger recessions. The Fed’s current policy of “quantitative tightening”—tightening or contracting the money supply—is the very definition of recession, a term Wikipedia defines as “a business cycle contraction which results in a general slowdown in economic activity.” This “business cycle” is not something inevitable, like the weather. It is triggered by the central bank. When the Fed drops interest rates, banks flood the market with “easy money,” allowing speculators to snatch up homes and other assets.
When the central bank then raises interest rates, it contracts the amount of money available to spend and to pay down debt. Borrowers go into default and foreclosed homes go on the market at fire-sale prices, again to be snatched up by the monied class. But it is a game of Monopoly that cannot go on forever. According to Elga Bartsch, chief European economist at Morgan Stanley, one more financial cataclysm could be all that it takes for central bank independence to end. “Having been overburdened for a long time, many central banks might just be one more economic downturn or financial crisis away from a full-on political backlash,” she wrote in a note to clients in 2017. “Such a political backlash could call into question one of the long-standing tenets of modern monetary policy making—central bank independence.”
And that may be the president’s endgame. When higher rates trigger another recession, Trump can point an accusing finger at the central bank, absolving his own policies of liability and underscoring the need for a major overhaul of the Fed. Trump has not overtly joined the End the Fed campaign, but he has had the ear of several advocates of that approach. One is John Allison, whom the president evidently considered for both Fed chairman and treasury secretary. Allison has proposed ending the Fed altogether and returning to the gold standard, and Trump suggested on the campaign trail that he approved of a gold-backed currency.
At some point David will be right.
David Stockman warns a 40 percent stock market plunge is closing in on Wall Street. Stockman, who served as President Reagan’s Office of Management and Budget director, has long warned of a deep downturn that would shake Wall Street’s most bullish investors. He believes the early rumblings of that epic downturn is finally here. It comes as the S&P 500 Index tries to rebound from its worst month since 2011. “No one has outlawed recessions. We’re within a year or two of one,” he said Thursday on CNBC’s “Futures Now.” He added that: “fair value of the S&P going into the next recession is well below 2000, 1500 — way below where we are today.” This is far from the first time he’s issued a dire warning. But this time, he suggests the latest leg down is an early tremor of the pain that lies ahead.
“If you’re a rational investor, you need only two words in your vocabulary: Trump and sell,” said Stockman, in a reference to President Donald Trump. “He’s playing with fire at the very top of an aging expansion.” According to Stockman, Trump’s efforts to get the Federal Reserve to put the brakes on hiking interest rates from historical lows is misdirected. “He’s attacking the Fed for going too quick when it’s been dithering for eight years. The funds rate at 2.13 percent is still below inflation,” he said. Stockman cited the trade war as another major reason why investors should brace for a prolonged sell-off. “The trade war is not remotely rational,” he said. If the dispute worsens, it “is going to hit the whole goods economy with inflation like you’ve never seen before because China supplies about 30 percent of the goods in the categories we import.”
The world’s fattest zombie?!
When we first heard news reports about a new investor in Deutsche Bank (DB), we of course assumed that this meant the purchase of new shares and thus an increase in capital. But no, it was merely an “activist investor” taking a stake in existing shares. Is this really news or merely a sign of a top in large bank stocks? The DB common is trading a hair over $10 or just 0.3x book value and has a beta of 1.5. Douglas Braunstein, founder and managing partner of Hudson Executive Capital and J.P. Morgan’s former CFO, said in an interview with CNBC that the firm has taken on the stake over the last few months after studying the stock for a year. We’ve been following DB for a lot longer than that and have great difficulty constructing a bull case for the name. But let’s take a look anyway.
First on the list of concerns is profitability. DB has been struggling for years to find a business strategy to deliver consistent profitability, the key measure of stability for any bank. Through the first nine months of the year, DB delivered net income of less than a €1 billion compared with €1.6 billion a year ago. For the full year 2017 the bank lost €750 million. As yet, no one on the management team – if we may so dignify DB’s executives – have been able to articulate a coherent plan to move forward. Second is capital. DB has just €61 billion or 4% capital to total assets of €1.5 trillion, one of the lowest simple leverage ratios of any major bank worldwide. The bank tries to hide this capital deficiency behind calculations that exclusively use “risk weighted “assets” of just €354 billion. In the bank’s non-GAPP disclosure, there is just €54 billion in tangible capital disclosed for a leverage ratio closer to 3%.
In the Q3 ’18 earnings call, when CEO Christian Sewing said that “we committed to conservative balance sheet management and maintaining a CET1 ratio above 13%,” he was referring to risk weighted assets, not total assets. If one assumes that the entire Basel III/IV framework is a confused mess when it comes to describing risk, then the leverage ratio is what matters. Risk weighted assets is a way to pretend that the rest of the banks in Europe and Asia are solvent. To be fair to DB, most European banks play the game of only referring to “risk weighted assets” in their financial disclosure to investors. The EU bank regulators are entirely complicit in this charade. Indeed, since the end of 2017 DB’s total capital has actually fallen 4%.
Italy knows. Austerity is under justified pressure. With Merkel leaving, and Juncker too.
With his dad jokes and fetish for spreadsheets, Philip Hammond does not fit the stereotype of a “gambler”. But the Institute for Fiscal Studies (IFS) nevertheless argues that the chancellor rolled the dice in last week’s Budget and took a rather risky wager. Instead of using his lower borrowing projection “windfall” from the official independent forecaster to reduce the deficit more rapidly, Hammond essentially spent it all on the health service, while leaving the overall path of government borrowing more or less unchanged. He could have had a projected budget surplus in five years’ time, but instead there’s still set to be around £20bn of borrowing in 2023-24.
Virtually the entire UK news media took up this “gambler” theme in their headline coverage of the aftermath of the Budget. Yet we should be extremely wary of this framing. Because it obscures the crucial truth that, in economics, the gamble is sometimes borrowing too little, not too much. The IFS, to be fair, was using the phrase in a narrow sense of the chancellor jeopardising his chances of meeting his own self-imposed fiscal rules. Those Office for Budget Responsibility (OBR) borrowing downgrades – whose origins remain mysterious given the official forecaster hasn’t upgraded its nominal GDP or growth forecasts which would be the most obvious explanations for higher than expected tax receipts lately – could very well be reversed in future budgets.
Since 2010, most underlying borrowing revisions have been negative (implying more borrowing than previously expected) rather than positive for the public finances. What the lord of forecasting (in this case OBR director Robert Chote) giveth, he can also taketh away. He even warned as much last week. And what would happen then?
if only she gives in she can have a deal yesterday.
The chances of Theresa May striking a deal with Brussels on the Irish border that she can sell to the cabinet and parliament are said by EU officials to be “50-50” as the fraught talks enter their final stretch. The British negotiating team and the European commission’s taskforce, led by Michel Barnier, are to enter a secretive phase known as the “tunnel” this week, but senior EU figures involved in the talks warned the competing redlines remain “incompatible” in key areas. The British government has set out its stall to make “decisive progress” on the issue of the Northern Ireland backstop by Friday, in the hope that Donald Tusk, the president of the European Council, could then call an extraordinary Brexit summit for the end of the month to seal the deal.
One Whitehall source said, should sufficient ground be made in the coming days, a tentative new date of 22 November is being floated for a meeting of the EU’s heads of state and government. Downing Street has insisted it does not have a deal ready for signoff, in response to reports over the weekend of there being an agreement in the making. “We are not sitting on powder keg knowledge that we have signed a secret deal,” the No 10 source said. “We are not on the cusp of some seismic shift.” Some at the highest levels of government fear that, unless progress is agreed by Tuesday when May sees her senior ministers and parliament breaks for recess, the cabinet may not have a direct input before a summit announcement is made.
“The reality is that we need a November summit more than the EU do,” a government source said. They suggested that a December deal would mean not only a later parliamentary vote but would require spending on no-deal planning and changes to the roles of hundreds of civil service.
Hard to see how May can avoid a Final Say.
Fourteen hundred of the UK’s top lawyers have urged Theresa May and MPs to back a second Brexit referendum, saying that democratic government “is not frozen in time”. Labour peer Baroness Kennedy QC, former Court of Appeal judge Konrad Schiemann and David Edward, a former judge of the Court of Justice of the European Communities, are among those who have called for a people’s vote on EU membership. In a letter to Mrs May, they say parliament should not be bound by the 2016 vote any more than it should be by the 1975 referendum that took Britain into the EU, especially when there are question marks over its validity.
They wrote that voters are entitled to know what they are voting for, and said: “There was a key difference between 1975 and 2016. The earlier referendum was held after negotiations were complete, so voters knew what they were voting for. “In 2016, the nature of the negotiation process and its outcome were unknown. Voters faced a choice between a known reality and an unknown alternative. “In the campaign, untestable claims took the place of facts and reality.” Human rights specialist Jonathan Cooper, a barrister at Doughty Street Chambers, said: “The current state of the Brexit negotiations is worrying people throughout the UK and the legal profession is no exception to that. “We represent people from across industry and society and we see every day the way the prospect of a catastrophic Brexit deal is already causing real harm.
First team of 15 to kill him, 2nd team of 11 to get rid of the body 9 days later. Question: what happened during those 9 days? The Turkish probably know.
Saudi Arabia deployed a chemist and toxicology expert to Istanbul after the murder of journalist Jamal Khashoggi in an attempt to cover up evidence of the killing, a Turkish newspaper reported on Monday. The murder of the Saudi royal-insider-turned critic inside Saudi Arabia’s consulate in Istanbul has provoked widespread international outrage. Turkish authorities have released gruesome details of a killing that President Recep Tayyip Erdogan has said was a targeted hit. While Riyadh officials have admitted the murder was planned, they have so far declined to release details of the whereabouts of the 59-year-old journalist’s missing body.
According to Turkey’s pro-government Sabah daily, Saudi Arabia sent an 11-member “cover-up team” to Istanbul on October 11, nine days after the Washington Post contributor vanished after entering the diplomatic compound to obtain paperwork for his marriage. The paper said chemist Ahmad Abdulaziz Aljanobi and toxicology expert Khaled Yahya Al Zahrani were among “the so-called investigative team”, which visited the consulate every day until October 17, before leaving Turkey on October 20. Saudi Arabia finally allowed Turkish police to search the consulate for the first time on October 15.
That might be a tad difficult. you know, between the bone saw and the acid…
The sons of slain Saudi journalist Jamal Khashoggi on Sunday issued an appeal for the return of their father’s body and said they wanted to return to Saudi Arabia to bury him. In an interview with CNN, Salah and Abdullah Khashoggi said that without their father’s body, their family is unable to grieve and deal with the emotional burden of their father’s death. “It’s not a normal situation, it’s not a normal death at all. All what we want right now is to bury him in Al-Baqi (cemetery) in Medina (Saudi Arabia) with the rest of his family,” Salah Khashoggi said. “I talked about that with the Saudi authorities and I just hope that it happens soon.”
[..] Khashoggi’s body has not been recovered, and Saudi authorities are conducting an official investigation. Saudi Arabian billionaire Prince Alwaleed bin Talal, an international businessman, said on Sunday that the probe will exonerate the country’s leader. Salah Khashoggi on Oct. 24 met in Riyadh with the crown prince and King Salman to receive condolences along with other Khashoggi family members. Salah departed for Washington a day later, and his CNN interview was his first public comments since then. He said King Salman assured him that those involved in Jamal Khashoggi’s murder would be brought to justice.
“We just need to make sure that he rests in peace,” Salah Khashoggi said of his father. “Until now, I still can’t believe that he’s dead. It’s not sinking in with me emotionally,” he said, adding that there has been a lot of “misinformation” about the circumstances of the death.
At some point we must ask ourselves: what have we been watching?
A Kentucky woman who accused Supreme Court Justice Brett Kavanaugh of rape has been referred to the Department of Justice after she admitted that she lied. The woman, Judy Munro-Leighton, took credit for contacting the office of Sen. Kamala Harris (D-CA) as “Jane Doe” from Oceanside, California. Jane Doe claimed – without naming a time or place – that Kavanaugh and a friend raped her “several times each” in the backseat of a car. Harris referred the letter to the committee for investigation. “They forced me to go into the backseat and took 2 turns raping me several times each. They dropped me off 3 two blocks from my home,” wrote Munro-Leighton, claiming that the pair told her “No one will believe if you tell. Be a good girl.”
Kavanaugh was questioned on September 26 about the allegation, to which he unequivocally stated: “[T]he whole thing is ridiculous. Nothing ever – anything like that, nothing… [T]he whole thing is just a crock, farce, wrong, didn’t happen, not anything close.” The next week, Munro-Leighton sent an email to the Judiciary committee claiming to be Jane Doe from Oceanside, California – reiterating her claims of a “vicious assault” which she said she knew “will get no media attention.” Upon investigation, the Judiciary Committee investigators found that Munro-Leighton was a left wing activist who is decades older than Judge Kavanaugh, who lives in Kentucky. When Committee investigators contacted her, she backpedaled on her claim of being the original Jane Doe – and said she emailed the committee “as a way to grab attention.”
“The witnesses that Dr. Ford identified as individuals who could corroborate her allegations failed to do so, and in fact, contradicted her..”
Republicans on the Senate Judiciary Committee late Saturday released a 414-page report in which the panel members say they found no supporting evidence for any of the allegations of sexual misconduct made against Supreme Court Justice Brett Kavanaugh ahead of his confirmation. “Committee investigators spoke with 45 individuals and took 25 written statements relating to the various allegations made in the course of the #SCOTUS confirmation process,” the Senate Judiciary Committee tweeted Saturday. “In neither the committee’s investigation nor in the supplemental background investigation conducted by the FBI was there ANY evidence to substantiate or corroborate any of the allegations.”
The committee investigators “found no verifiable evidence that supported” Christine Blasey Ford’s allegation that Kavanaugh pinned her to a bed in the early 1980s and attempted to remove her clothes while covering her mouth with one hand. “The witnesses that Dr. Ford identified as individuals who could corroborate her allegations failed to do so, and in fact, contradicted her,” the report notes. It also states that committee investigators “found no verifiable evidence” to support Deborah Ramirez’s claim that Kavanaugh exposed himself to her at a party when they were both at Yale. The report additionally dismisses allegations from Julie Swetnick, forwarded by lawyer Michael Avenatti.
“Indeed, the evidence appears to support the position that Julie Swetnick and Mr. Avenatti criminally conspired to make materially false statements to the Committee and obstruct the Committee’s investigation,” the report writes. Avenatti and Swetnick have both been referred to the Department of Justice for potential criminal investigations into their behavior during Kavanaugh’s confirmation process. Avenatti has been referred a second time.