Feb 072015
 
 February 7, 2015  Posted by at 11:20 am Finance Tagged with: , , , , , , ,  


NPC Minker Motor Co, 14th Street NW, Washington, DC 1922

Currency Devaluations Are an Undeclared War (Bloomberg)
The PBOC – How To Fail In Business Without Really Flying (Russell Napier)
The Diverging Fates of China’s Provinces (Bloomberg)
Goldman Raises Alarm Over The Scariest Chart In The Jobs Report (Zero Hedge)
Stop Squeezing Syriza. We Can’t Afford Another Wrong Turn In Europe (Guardian)
Troika Trojan Horse: Will Syriza Capitulate In Greece? (Pepe Escobar)
Greece Seeks Plan C After Eurogroup Rules Out Bridge Loan (Bloomberg)
Syriza Vows To Fight Pressure To Stick To Bailout Terms (Guardian)
Greece: We Want No More Bailout With Strings (Reuters)
Defiance and Charm: A Measured First Week for New Greek Leader (Spiegel)
It’s Merkel Legacy Moment (Bloomberg)
Irish Fighting Bankers Show It’s Not Just Greeks Protesting Debt (Bloomberg)
The Biggest Loss for Scotland Since Independence Fail (Bloomberg)
Oil Production Increases Ahead: Alberta Premier (CNBC)
A Modest Proposal To Save The World (Charles Gave)
The TTIP US-EU Trade Deal -A Briefing (Guardian)
Pentagon 2008 Study Claims Putin Has Asperger’s Syndrome (USA Today)
US Navy Sailors Search for Justice after Fukushima Mission (Spiegel)
The Stuff Paradox: Dealing With Clutter (BBC)
American Sniper Is A Movie Hitler ‘Would Have Been Proud To Have Made’ (Ind.)

“The reason why this is a war is that it is ultimately a zero-sum game – someone gains only because someone else will lose.”

Currency Devaluations Are an Undeclared War (Bloomberg)

The global currency war is threatening to prove a silent killer. So says David Woo, head of global rates and currencies research at Bank of America Merrill Lynch in New York. While some question the existence of any conflict – arguing that falling exchange rates merely reflect efforts by central banks to spur lackluster domestic economies – Woo expresses concern. “There is a growing consensus in the market that an unspoken currency war has broken out,” he said in a report to clients this week. “The reason why this is a war is that it is ultimately a zero-sum game – someone gains only because someone else will lose.” The standard view on war-mongering is that by easing monetary policy, central banks from Asia to Europe are hoping to weaken their currencies to boost exports and import prices.

Trade rivals then retaliate, creating a spiral of devaluations as witnessed in the 1930s. Just this week, Reserve Bank of Australia Governor Glenn Stevens said “a lower exchange rate is likely to be needed” after he unexpectedly cut interest rates to a record low. With more than a dozen central banks injecting extra stimulus so far this year, currencies will be discussed when finance ministers and central bankers from the Group of 20 meet next week in Istanbul. For much of the past two years the G-20 has formally committed to refrain from targeting “exchange rates for competitive purposes.” That leaves Woo, a former IMF economist, declaring the war is one of “stealth” and warning the fallout from it is already roiling financial markets in a way undetected by most.

By measuring the volatility of currencies, which he calculates as the difference between the maximum and minimum exchange rate over a 26-week period, Woo estimates the dollar has been swinging about 20% against both the yen and the euro. In the past 15 years it was only higher following the collapse of Lehman Brothers in 2008. A second gauge of volatility that weighs currencies based on the gross domestic product of 20 major economies delivers the third-highest reading in two decades, topped only by the Asian crisis of 1997-98 and Lehman’s demise, he said.

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“.. the Costa Rican central bank has just announced that they will be floating the Colon. Those of a squeamish disposition should certainly not try googling “floating colon”..”

The PBOC – How To Fail In Business Without Really Flying (Russell Napier)

“Terrain seems a bit unstable…and there seems to be no sign of intelegent life anywhere” – Buzz Lightyear (Toy Story) “That wasn’t flying…that was falling with style” – Woody (Toy Story)

Another day, another central bank failure. In a world of currencies backed only by confidence, every failure is masqueraded as success. Like the ballet dancer who transforms the stumble into a pirouette, central bankers, knocked to the ground by market forces, smile and pretend that this was all part of the routine. Financial market participants, having bet everything on the promised omnipotence of central bankers, do indeed seem happy to see genius in every stumble. However a fall is a fall regardless of the style of the descent. So when will investors see that the earth is rapidly approaching and that style is just style? The key for investors today is to see behind the masquerade and the mask, the façade of those putting up a front behind a public face, and be able to tell the difference between the soaring flight of reflation and the perilous fall of deflation.

The more attitude you hear from policy makers, the more you can be sure it’s style compensating for the lack of real substance and that this is falling and not flying. And as the attitude becomes more high-handed, the lower the altitude gets. The attitude quotient is rising rapidly. Two weeks ago we noted the ‘flying’ undertaken by the Swiss National Bank as the market forced them to abandon their exchange-rate target. Deposit rates in Swiss Banks are now at such a low level that investors are better off converting deposits into bank notes and placing them under the bed. The Danish Central Bank has also instituted negative interest rates with the consequence that deposits in Denmark might also fly into paper. As the central bank managed to create over DKK106bn (US$16.3bn) in bank reserves, trying to stop a revaluation of their exchange rate last month, there will be no shortage of banknotes to go round should a ‘bank run’ from deposits to banknotes begin.

Taking interest rates so negative that they threaten a run on bank deposits should not be seen as success – it is failure. Creating bank reserves at that pace should not be seen as success – it is failure. The next failure may well be some government-inspired restriction on capital inflows. Well, you could call such restrictions, and risking the liquidity of banks, monetary success if you like, but then you probably also think it’s a success to throw the ball one yard from the touchline. Last week the Monetary Authority of Singapore was apparently “flying”, definitely not falling, when it cut interest rates and tried to devalue the SGD to defeat deflation. The Central Bank of Russia reduced interest rates while defending its exchange rate and, guess what, the currency fell. Most people, of course, would recognize that as simply falling, but as it was Russia you do have to ask did it just fall, or was it pushed ?

You may even have missed the news, that the Costa Rican central bank has just announced that they will be floating the Colon. Those of a squeamish disposition should certainly not try googling “floating colon” but, just take their word for it, the Colon will float. Elsewhere there were examples of more conventional falling, disguised as controlled flying, in the form of cuts in interest rates from Australia, Canada, Egypt, India, Pakistan, Peru and Turkey. The Turkish President has the perfect style for this sport and declared that interest rates had to fall as they were the cause and not the cure for inflation. As our hero himself remarked, ‘Buzz Lightyear to star command, I have an AWOL space ranger.’

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“The decline of fiscal revenue is the top risk in China and will lead to a sharp slowdown in GDP’..’

The Diverging Fates of China’s Provinces (Bloomberg)

From the biting-cold northeast bordering Siberia to the humid southwest next to Thailand, China’s growth rates are diverging almost as much as its geography. While the world’s second-largest economy slowed to a 7.4% expansion last year – just squeaking into the communist government’s “about 7.5%” target range – regional data presents a fractured landscape more akin to Europe’s than the rising-tide-floats-all-boats numbers we’re used to from China. There’s still a Germany: the wealthier export-focused and high-end manufacturing coastal region spanning Jiangsu, Zhejiang and Fujian. All were within about half a percentage point of their 2014 growth goals. The emerging provinces of Chongqing and Guizhou – later developers than their coastal cousins – look OK, too.

Let’s mark them down as China’s Poland, with lower labor and land costs attracting factories and helping exports. Both posted plus-10-percent expansions last year. The population-heavy Hunan, Hubei and Henan — with a combined 219 million people – almost matched their growth targets, with investment sustaining these massive economies. They’re way too populous to fit our European analogy, though. There’s even an Iceland-like outperformer: Tibet. The vast, mountainous region – which is about 12 times the size of tiny Iceland – was the only one of China’s 31 provinces and municipalities to match its 2014 target, racing ahead at 12%. Government-led infrastructure investment is behind its boom. Then we come to the sick men. While an expansion of about 5% would be stellar by European standards, in China that’s a slump.

The coal-dependent northern province of Shanxi missed its expansion target by a full 4 percentage points last year. Three other heavy industry and commodities driven north-eastern provinces – Heilongjiang, Jilin, Liaoning – all lagged with expansions near 6%, below targets of 8 or 9%. While policymakers in Beijing don’t have to contend with Grexit-like threats, there are headaches ahead. “Given the sluggish economic growth and fiscal pressure from dropping land sales, local governments have become much less ambitious than before,” Deutsche Bank AG’s chief China economist Zhang Zhiwei wrote in a Jan. 30 note. “The decline of fiscal revenue is the top risk in China and will lead to a sharp slowdown in GDP” to 6.8% this quarter. Like Europe, the slowdown may prompt more monetary easing after this week’s reduction in banks’ reserve ratio requirements.

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No good US jobs report without hidden secrets.

Goldman Raises Alarm Over The Scariest Chart In The Jobs Report (Zero Hedge)

Following the January jobs report, Goldman’s chief economist Jan Hatzius appeared on CNBC but instead of joining Steve Liesman in singing the praises of the “strong” the report (which apparently missed the memo about the crude collapse), he decided to do something totally different and instead emphasize the two series that none other than Zero Hedge has been emphasizing for years as the clearest indication of what is really happening with the US labor market: namely the recession-level civilian employment to population ratio and the paltry annual increase in average hourly earnings. This is what Hatzius said:

“The employment to population ratio is still 4% below where it was in 2006. You can explain 2% of that with the aging of the population that still leaves quite a lot of room potentially, and the wage numbers are telling us we are just not that close, although we are getting closer.”

Closer to what? Why the most dreaded event for any FDIC-backed hedge fund in the world: the Fed not only ending some $3 trillion of liquidity injections but actively starting to remove liquidity by tightening monetary conditions and rising rates. Hatzius’ punchline: “I think the case for “patience” is still quite strong.” In other words, the US may be creating almost 300K jobs per month, but stocks are still not high enough. So how should one look at today’s BLS report: well, for political purposes the data is great – just look at those whopping revisions; but when it comes to the markets, please focus on the the unadjusted, ugly details beneath the headlines. Those which we have been showing for months and months.

Because there always has to be something that prevent the Fed from hiking, and killing Chuck Prince’s proverbial music, in the process ending Wall Street’s 6-year-old “dance” ever since the 666 S&P lows. At this rate soon Goldman Sachs will become a bigger “skeptical realist” than Zero Hedge. Finally, which chart is Hatzius talking about? The one below, showing the uncanny correlation between the US civilian employment to population ratio and the annual rate of increases in hourly earnings, and the fact that neither is capable of actually increasing under the “NIRP Normal” recovery.

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And that’s how simple it is.

Stop Squeezing Syriza. We Can’t Afford Another Wrong Turn In Europe (Guardian)

With Syriza having won Greece’s election on a platform to reject the Troika-imposed bailout, the eurozone has reached yet another fork in the road. Let us hope it does not take the wrong turn, again. Squeezing Syriza and humiliating Greece further, as appears to be the strategy in Germany and other powers in the EU, could be the straw that breaks the eurozone’s back. Cutting Greece any slack is opposed by a majority of Germans, even while support for Alexis Tsipras in Greece soared after his election as he fought for concessions on debt. Political space in the eurozone has shrunk to a point where it may no longer be possible to implement sensible economic policy. Which wrong turns did we take? How can we choose wisely this time?

At the outbreak of the crisis, EU leaders insisted on national solutions to what was essentially a European problem: the fragility of large often pan-European banks. This increased the final bill, as countries refused to bite the bullet and delayed recognising that their banks were bust. Even as leaders came under domestic fire for rescuing banks with taxpayer money, Greece’s fiscal problems provided a godsend distraction. Many northern Europeans promoted a narrative of “lazy Greeks” who had been “fiscally profligate”. While the unsustainability of Greek debt was recognised by many, intensive lobbying by German and French banks which owned large amounts of Greek bonds meant that the much-needed restructuring of this debt was vetoed. An ill-designed programme was imposed as condition of financial aid to Greece.

This was essentially a bailout of European banks at the expense of Greek citizens and European taxpayers. Even worse, the narrative of “lazy southerners” and a “fiscal crisis” promoted by Germany and EU institutions crowded out the reality of an untreated banking crisis. Ireland, having foolishly guaranteed its insolvent banks, was then forbidden from imposing losses on bank bondholders by the ECB. Private debt became public and the banking crisis became a fiscal one. Even though the failure to repair and restructure banks was the biggest problem in countries such as Spain, many were treated as though they had been fiscally irresponsible and prescribed austerity.

As bank uncertainty and fiscal cuts were biting and driving the eurozone into a deep recession, the narrative of a “fiscal crisis” became self-fulfilling as debt-to-GDP ratios climbed because of both bank rescues and collapsing GDPs. The problem was compounded by Angela Merkel and Nicolas Sarkozy threatening to push Greece out of the eurozone, which in turn made markets question the viability of the single currency and fuelled panic, driving Spanish and Italian spreads up to record levels. Thus the downward spiral of a badly misdiagnosed and deliberately miscommunicated problem, and a tragically ill-conceived treatment began. Bailing out the supposedly lazy southerners has stoked anti-EU sentiment in creditor economies like Germany, who want to see more, not less austerity in debtor economies. Suffering under Troika-imposed excessive austerity has fuelled the rise of anti-austerity parties such as Syriza and Podémos.

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“The ECB bought Greek public debt from private banks for a fortune [..] private banks had found the cash to buy Greece’s public debt exactly from…the ECB. This is outright theft. ”

Troika Trojan Horse: Will Syriza Capitulate In Greece? (Pepe Escobar)

The 2015 Greek tragedy is a sorry (financial) remix of the Trojan War. But now the troika (ECB, EC, IMF) has replaced Greece, and Greece is the new Troy. It is now crystal clear the ECB will pull no punches to turn Greece into a European failed state. The rationale: others – from Spain to even, in the near future, France – must not entertain funny ideas. Toe the austerity line, or we’ll get medieval on you. It was so predictable that the destiny of Athens – and in fact the euro – would ultimately rest in the hands of ECB Governor Mario ‘Master of the Universe’ Draghi, purveyor of the latest QE which in thesis will grant an austerity-ravaged Europe a little extra time to pursue ‘reforms’.

Some background is essential. The troika sold Greece an economic racket, but it’s the Greek people that are paying the price. Essentially, Greece’s public debt went from private to public hands when the ECB and the IMF ‘rescued’ private (German, French, Spanish) banks. The debt, of course, ballooned. The troika intervened, not to save Greece, but to save private banking. The ECB bought public debt from private banks for a fortune, because the ECB could not buy public debt directly from the Greek state. The icing on this layer cake is that private banks had found the cash to buy Greece’s public debt exactly from…the ECB, profiting from ultra-friendly interest rates. This is outright theft. And it’s the thieves that have been setting the rules of the game all along.

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“The next showdown is scheduled for Feb. 11 in Brussels..”

Greece Seeks Plan C After Eurogroup Rules Out Bridge Loan (Bloomberg)

Euro-area governments won’t grant Greece’s request for a short-term financing agreement to keep the country afloat while it renegotiates the terms of its financial support, said Jeroen Dijsselbloem, chairman of the bloc’s finance ministers’ group. “We don’t do” bridge loans, Dijsselbloem told reporters in The Hague on Friday, when asked about Greece’s request. “A simple extension is possible as long as they fully take over the program.” The European Union’s latest rebuff raises the stakes for Greece’s new government, which has already failed in its demands for a debt writedown. The next showdown is scheduled for Feb. 11 in Brussels, when Greek Finance Minister Yanis Varoufakis faces his 18 euro-area counterparts in an emergency meeting after Prime Minister Alexis Tsipras delivers a major policy speech on Sunday.

“After an aggressive start, which resulted in a reality check for the new government, I think they are becoming more pragmatic,” said Aristides Hatzis, an associate professor of law and economics at the University of Athens. “No matter what they say to their internal audience, what they do abroad matters most.” Varoufakis has said his government won’t accept any more cash under the terms of Greece’s existing bailout, leaving €7 billion euros of potential aid on the table, rather than complying with demands for more austerity attached to the country’s international bailout agreement.

“Practically speaking, our proposal is that there should be a bridging program between now and the end of May, which would give us space – all of us – to carry out these deliberations and in a short space of time come to an agreement” Varoufakis said after meeting German Finance Minister Wolfgang Schaeuble in Berlin on Feb. 5. The standoff risks leaving Europe’s most-indebted state without any funding as of the end of this month, following the Jan. 25 election victory of Tsipras’s Syriza party. “It will be a first step in how we want to proceed together in the next weeks, months,” Dijsselbloem said, as he cautioned that a discussion over the terms of the bailout program would mean “we no longer talk about a simple extension.”

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Why does even the Guardian choose to speak of ‘Greece’s radical Syriza government’?

Syriza Vows To Fight Pressure To Stick To Bailout Terms (Guardian)

Greece’s radical Syriza government has vowed to keep fighting pressure from its eurozone neighbours to stick to the strict terms of its bailout package as battle lines were drawn ahead of crunch debt talks next week. Eurozone finance ministers have called an emergency meeting for Wednesday night in Brussels to discuss the Greek crisis after a whistlestop tour of Europe by Yanis Varoufakis, Greece’s finance minister, made little headway. Germany wants Greece to arrive with a plan on the repayment of €240bn (£180bn) in bailout loans it received from the international community.

The special debt meeting will be followed on Friday by a summit of European leaders, the first with Alexis Tsipras, the Greek prime minister. But a government official ruled out accepting a plan based on the old bailout and said Varoufakis would ask for a bridge agreement to tide Athens over until it can present a new debt and reform programme. “We will not accept any deal which is not related to a new programme,” an official told Reuters news agency.

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“It is … necessary that Greece is given the possibility to issue T-bills, beyond the (current) €15 billion threshold, in order to cover any extra needs..”

Greece: We Want No More Bailout With Strings (Reuters)

Greece’s new leftist-led government, isolated in the euro zone and under pressure from the European Central Bank, said on Friday it wanted no more bailout money with strings attached from the EU and IMF. Instead, a government official said, it wanted authority from the euro zone to issue more short-term debt, and to receive profits that the European Central Bank and other central banks have gained from holding Greek bonds. The official said Greece was in effect asking for a “bridge agreement” to keep state finances running until Athens can present a new debt and reform program, “not a new bailout, with terms, inspection visits, etc.”.

“It is … necessary that Greece is given the possibility to issue T-bills, beyond the (current) €15 billion threshold, in order to cover any extra needs,” said the official, asking not be named. Finance Minister Yanis Varoufakis returned empty-handed from a tour of European capitals in which even left-leaning governments in France and Italy insisted Greece must stick to commitments made to the European Union and IMF and rejected any debt write-off. The Athens official made clear that the new government, which came to power on a wave of anti-austerity anger in elections last month, now wanted to forego remaining bailout money that had austerity strings attached: “Greece is not asking for the remaining tranches of the current bailout program – except the €1.9 billion that the ECB and the EU member states’ central banks must return.”

Euro zone finance ministers will discuss how to proceed with financial support for Athens at a special session next Wednesday ahead of the first summit of EU leaders with the new Greek prime minister, Alexis Tsipras, the following day. However, the chairman of the finance ministers said the following meeting of the Eurogroup on Feb. 16 would be Greece’s last chance to apply for a bailout extension because some euro zone countries would need to consult their parliaments. “Time will become very short if they (Greece) don’t ask for an extension (by then),” said Jeroen Dijsselbloem. The current bailout for Greece expires on Feb 28. Without it the country will not get financing or debt relief from its lenders and has little hope of financing itself in the markets.

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Surprisingly positive piece from Der Spiegel, which just last week was very pro-Merkel. “..his left-wing government is already busy getting down to work. Many of its first moves have been the right ones.”

Defiance and Charm: A Measured First Week for New Greek Leader (Spiegel)

Syriza’s victory in the recent Greek elections set off a wave of concern in Europe. But even as the new prime minister tries to woo other leaders, his left-wing government is already busy getting down to work. Many of its first moves have been the right ones. [..] Something has happened in Greece that has not happened like this anywhere else in Europe: A handful of neophyte politicians, intellectuals and university professors have taken over the government. It feels like a small revolution instead of a handover of duties. And that’s not only because many members of the previous administration deleted their hard drives and took their documents with them, or that there initially wasn’t even any soap in the government headquarters.

No, the new government has upended the rules of the Greek political system – and spurred into action a Europe that is still unsure how it should react to the rebels. In Athens you can also see the euphoria reflected in the city’s traffic, which is a yardstick for the crisis. The streets had often been half empty, because fewer people were traveling to work, the gasoline was expensive, the mood gloomy. But now the city center is just as clogged as before. The people are once again in motion. Even though only 36% of voters chose Syriza, 60% of Greeks are happy with new government’s first few days. If there were new elections, support for the party could grow and Tsipras could renounce his coalition partner. Although he may be entertaining that scenario privately, members of the government deny that it is in the cards. But to maintain this enthusiasm, Tsipras now needs to show a real accomplishment: an end of the German “austerity mandate.” Which means that he doesn’t merely need to convince the Greeks, he needs to conquer Europe.

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“So either Tsipras turns 180 degrees or the euro area’s post-crisis, anti-contagion defenses will get their stiffest test.”

It’s Merkel Legacy Moment (Bloomberg)

It’s a legacy moment for Angela Merkel. How the German chancellor navigates the two-front crisis emanating from Moscow and Athens could determine whether she rises to her role as Europe’s dominant leader or slips into history as a risk-averse manager who couldn’t hold the region together. “The immediacy and urgency of taming the dual Greek and Ukraine nightmares are defining moments for Europe and for Merkel,” said Bud Collier, professor at the John F. Kennedy Institute of Berlin’s Free University. “The stakes are enormous.” An abundance of caution is the complaint she’s faced from the moment Greece spawned the euro financial crisis – forcing needy nations to take their medicine and suffer for budgetary sins in the name of becoming more competitive. In return, she slowly brought her reluctant electorate along and pried open her government’s checkbook.

Now the Greeks are as fed up as the Germans. They elected Alexis Tsipras as prime minister on the promise the days of pension, wage and job cuts were over. They’re also trying to get under Merkel’s skin. Standing in Germany’s finance ministry, the stone behemoth that was Herman Goering’s headquarters in Adolf Hitler’s regime, Greek Finance Minister Yanis Varoufakis touched the most sensitive spot in Germany’s collective consciousness: “Germany must and can be proud that Nazism has been eradicated here, but it’s one of history’s most cruel ironies that Nazism is rearing its ugly head in Greece, a country which put up such a fine struggle against it.” Remarks like that may explain Merkel’s exasperation with the new leaders in Athens and why she’s waiting for them to come around to see things her way. If they don’t, neither she nor her allies have expressed much interest in a middle ground.

So either Tsipras turns 180 degrees or the euro area’s post-crisis, anti-contagion defenses will get their stiffest test. The next signals are likely at the EU’s Feb. 12 summit. Also on the agenda at that gathering is what to do about Putin. As with Tsipras, she’s not optimistic. Unlike with Greece, though, Merkel has few cards to play. She’s stuck between the U.S. and Russia, herding the EU’s 28 governments and is largely the point person because of geography. She has stopped seeing Putin as a rational actor, according to German government officials, but is the closest to an interlocutor that she has. As she arrives for talks in Moscow with French President Francois Hollande and the fighting intensifies, the united anti-Putin front is at risk amid dwindling options: tougher sanctions that many EU leaders are resisting, arming the government in Kiev or yielding to the breakup of Ukraine.

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“About 117,000 home-mortgage accounts are in arrears, according to central bank figures, and the Free Legal Advice Centres group said last month that a “substantial spike” in repossessions may be on the way.”

Irish Fighting Bankers Show It’s Not Just Greeks Protesting Debt (Bloomberg)

Byron Jenkins says he would rather destroy his home than hand it over to the banks. The former builder owes about €750,000 euros on his house in a Co. Kildare town about 40 miles west of Dublin. After 15 court appearances, he’s still fending off repossession. “All they’ll get back is a pile of bricks,” Jenkins said. “I’ve told them that.” Banks lodged 10,000 applications to foreclose on family homes in the year through September, a legal rights group said last month, four times as many as in the previous year. The legacy of western Europe’s worst real estate crash is entering a new phase, bringing with it a very Irish version of the backlash against the establishment sweeping Europe.

As Greeks turned to Alexis Tsipras to reverse five years of austerity, and anti-immigrant parties gain ground in countries like France and Sweden, in Ireland, homeowners are increasingly organizing resistance. Jenkins is part of a group of activists allied to the Land League, named after a 19th century organization that battled with landlords when Ireland was ruled from London. In the 21st century, the fight is against bankers. “We have been creating mayhem, if by mayhem you mean keeping people in their homes,” said Jerry Beades, a developer who has spent almost a decade in disputes with banks and financial regulators and is now leading the League. “We are reflecting the anger that’s out there about the level of debt that just can’t be serviced.” About 117,000 home-mortgage accounts are in arrears, according to central bank figures, and the Free Legal Advice Centres group said last month that a “substantial spike” in repossessions may be on the way.

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“Aberdeen has been the focus of a classic oil boom..”

The Biggest Loss for Scotland Since Independence Fail (Bloomberg)

In Aberdeen, a city built out of granite on Scotland’s North Sea coast, a diamond merchant checks the price of oil every day. Until recently, the dealer, Oscar Ozdaslar, had been accustomed to North Sea oil workers stopping in to buy 3,500-pound ($5,260) diamond rings and earrings in his store on Union Street. “This Christmas was very quiet compared to the Christmas before,” said Ozdaslar, 50. “The oil guys didn’t come in.” Just six months ago, Aberdeen was the economic linchpin of Scotland’s campaign to split from the U.K. as oil traded above $100 a barrel. In the wake of the independence referendum’s failure, it serves as a microcosm of how crude’s slump to nearer $50 is hurting cities from Calgary to Kuala Lumpur.

“Aberdeen has been the focus of a classic oil boom,” said Gordon Hughes, a professor of economics in the University of Edinburgh. “There’s no doubt that the city will go through a bad period now that it’s over.” What’s more, the North Sea basin is among the most expensive in the world from which to extract oil. About 20% of U.K. production is “uneconomic” at $50 a barrel, trade group Oil & Gas U.K. says. After rallying this week, brent for March settlement traded at $57.72 a barrel on the ICE Futures Europe exchange on Friday. BP CEO Bob Dudley said this week it feels like the 1980s when he was living in Aberdeen working as an artificial lift engineer for Amoco before it merged with BP. Prices fell about 70% in a few months after Saudi Arabia increased production and didn’t recover until 1990. Regions worldwide that depend on the industry are having an “enormous shock,” he said.

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“We’ll actually be experiencing production increases over the next two years, notwithstanding low oil prices.”

Oil Production Increases Ahead: Alberta Premier (CNBC)

The steep drop in oil prices will lead to some slowdown of economic activity in Alberta, Canada, and the deferral of large capital investments in its oil sands, but Alberta Premier Jim Prentice told CNBC Friday its economy is resilient and will weather the rout. “This will be a difficult time. We’re assuming this will carry on for next 18 months or so and that we’ll be in a low-price environment,” he said in an interview. “We expect there will be some falloff in conventional drilling activity, shale drilling activity as well, clearly, but at the end of the day our economy is resilient.” Canadian rig count is down 13 rigs from last week, to 381, according to Baker Hughes. It is down 240 rigs from last year. However, oil production is going to increase. “We’ll actually be experiencing production increases over the next two years, notwithstanding low oil prices.”

Most of the oil in the region comes from oil sands, which produce about 1.9 million barrels of oil a day. In fact, Alberta’s oil sands are the third-largest crude oil reserve in the world. The province has proven oil reserves of 170 billion barrels. Prentice expects to see economic to slow down in cities like Calgary, but said Alberta has a strong public balance sheet and strong companies. About 121,500 citizens are directly employed in Alberta’s mining, oil, and gas extraction sectors. “I think there will be some consolidation to strength as we work our way through this. And certainly there will be implications and we’re concerned about that and we’re planning for that,” he said. That said, while he’s seen a deferral of large capital investments on new increments of oil sands investments and a reduction in capital expenditure in traditional oil and gas activity, Prentice sees a light at the end of the tunnel. “This will be part of a cycle, and we’ll eventually see the other side of this.”

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“..the final mission of any truly modern government must be to redirect the inventory of savings for the benefit of the rich (while, of course, claiming it is acting for the poor).”

A Modest Proposal To Save The World (Charles Gave)

As such, it seems that the ultimate aim of policy must be to transfer the nation’s entire wealth to an ever smaller number of rich people, most of who work in finance. Perhaps this is as it should be, since as already noted, money and only money can create value. Hence, the final mission of any truly modern government must be to redirect the inventory of savings for the benefit of the rich (while, of course, claiming it is acting for the poor). Interestingly, Europe’s socialists and the Democrats in the US have the ideal political cover to carry out this important exercise. And this, of course, brings us to Greece and my own big solution.

The lack of final demand in that benighted country shows that Alexis Tsipras must manage an economy suffering from not enough government spending. In response, Athens should issue unlimited sums of perpetual zero coupon bonds, which will be bought by the ECB. Next, the Italian, French and Spanish governments should follow suit. The proceeds can be transferred to local government districts in order for civil servants to be hired in earnest. The effect would be to greatly boost the local GDP, by the amount of the salaries paid to the civil servants, while the debt-to-GDP ratio will fall accordingly. The Bundesbank will be happy. Of course, the simple minded (non-economist fellows) might wonder who will buy this paper.

The answer is simple: the authorities must slap a 100% reserve requirement on all products held by insurance companies, banks and pension funds, and ‘hey presto!’ bond issues will be oversubscribed. Of course, if the choice is between a zero coupon perpetual bond and shares in the stock market, I have no doubt that the Dow will be at 100,000 in no time. At the same time, since the only competition for the perpetual zeros will be cash, the use of bank notes will need to be outlawed. Some smart fellows have already started working on this highly progressive idea. The only thing that I do not understand is why it has not yet been adopted. It must be the fault of incompetent politicians, advised by poorly trained economists. There is no other explanation.

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Again: the resistance to TTIP is not nearly strong enough.

The TTIP US-EU Trade Deal -A Briefing (Guardian)

What’s the story? It’s been called the most contested acronym in Europe, a putative free-trade deal between the world’s two richest trading powers that will either unleash untold prosperity or economic and cultural ruin, depending on your point of view. The Transatlantic Trade and Investment Partnership (TTIP) is an ugly mouthful, and not just in name. The aim is not just to reduce tariffs between the EU and US but to remove regulatory barriers and standardise rules so that companies can access each other’s market more easily. It has the potential to be the biggest trade deal ever concluded. But there are formidable pitfalls and obstacles along the way. Europeans hope the talks, which embark on an eighth round this week after almost two years of deliberation, will result in access to financial services in the US.

Washington is resisting. The Americans are eyeing up the food markets that serve the EU’s 500 million mouths. Europeans are concerned this will bring lower US food standards to a continent that prizes its Italian hams and French champagnes. Above all, public scepticism to the trade accord is spreading across Europe, where growing numbers are suspicious of their political leadership and disenchanted by two decades of globalisation. The treaty has been in the works for 12 years, and came about as it became apparent that bigger global trade deals would be hard to achieve. Negotiations started in 2013 and involve at least 100 participants. [..]

The biggest problem with TTIP is that the most significant gains are to be made from an area that the public is queasiest about: deregulation. Negotiators know that just removing tariffs is the easy bit – and not worth nearly as much as reforming, reducing and/or harmonising the differing regulations that govern business and industry in the US. But one person’s regulation is another’s protection, and opponents of TTIP argue that it could threaten consumer protection, social rights, health, the environment and data protection. Some even fret that it could open the door to privatisation by allowing, for example, US health companies to run parts of Britain’s publicly owned National Health Service.

The Europeans have already secured the exclusion of audio-visual services to protect the French film industry, a neuralgic issue for leaders in Paris. The question is: will the long list of other exceptions that already include GM food and hormone-fed beef dilute the deal to make it less worthwhile? An even bigger stumbling block is another clunky acronym, ISDS (Investor State Dispute Settlement), which would allow businesses to sue governments for action that would hurt future profits. Supporters of the bill have argued that ISDS plays an essential role in ensuring smooth transatlantic negotiations. Critics fret that it would bypass national laws and subjugate the interest of governments to those of big business.

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Fun with sketchy ‘science’.

Pentagon 2008 Study Claims Putin Has Asperger’s Syndrome (USA Today)

A study from a Pentagon think tank theorizes that Russian President Vladimir Putin has Asperger’s syndrome, “an autistic disorder which affects all of his decisions,” according to the 2008 report obtained by USA TODAY. Putin’s “neurological development was significantly interrupted in infancy,” wrote Brenda Connors, an expert in movement pattern analysis at the U.S. Naval War College in Newport, R.I. Studies of his movement, Connors wrote, reveal “that the Russian President carries a neurological abnormality.” The 2008 study was one of many by Connors and her colleagues, who are contractors for the Office of Net Assessment (ONA), an internal Pentagon think tank that helps devise long-term military strategy.

The 2008 report and a 2011 study were provided to USA TODAY as part of a Freedom of Information Act request. Researchers can’t prove their theory about Putin and Asperger’s, the report said, because they were not able to perform a brain scan on the Russian president. The report cites work by autism specialists as backing their findings. It is not known whether the research has been acted on by Pentagon or administration officials. The 2008 report cites Dr. Stephen Porges, who is now a University of North Carolina psychiatry professor, as concluding that “Putin carries a form of autism.” However, Porges said Wednesday he had never seen the finished report and “would back off saying he has Asperger’s.”

Instead, Porges said, his analysis was that U.S. officials needed to find quieter settings in which to deal with Putin, whose behavior and facial expressions reveal someone who is defensive in large social settings. Although these features are observed in Asperger’s, they are also observed in individuals who have difficulties staying calm in social settings and have low thresholds to be reactive. “If you need to do things with him, you don’t want to be in a big state affair but more of one-on-one situation someplace somewhere quiet,” he said.

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And what do they meet, of course? Denial.

US Navy Sailors Search for Justice after Fukushima Mission (Spiegel)

On March 11, 2011, the American aircraft carrier USS Ronald Reagan received orders to change course and head for the east coast of Japan, which had just been devastated by a tsunami. The Ronald Reagan had been on its way to South Korea when the order reached it and Captain Thom Burke, who was in charge of the ship along with its crew of 4,500 men and women, duly redirected his vessel. The Americans reached the Japanese coastline on March 12, just north of Sendai and remained in the region for several weeks. The mission was named Tomodachi. The word tomodachi means “friends.” In hindsight, the choice seems like a delicate one. Three-and-a-half years later, Master Chief Petty Officer Leticia Morales is sitting in a café in a rundown department store north of Seattle and trying to remember the name of the doctor who removed her thyroid gland 10 months ago.

Her partner Tiffany is sitting next to her fishing pills out of a large box and pushing them over to Morales. “It was something like Erikson,” Morales says. “Or maybe his first name was Eric, or Rick. Oh, I don’t know. Too many doctors.” In the last year-and-a-half, she has seen oncologists, radiologists, cardiologists, blood specialists, kidney specialists, gastrointestinal specialists, lymph node experts and metabolic specialists. “I’m now spending half the month in doctors’ offices,” she says. “This year, I’ve had more than 20 MRTs. I’ve simply lost track.” She swallows one of the pills, takes a sip of water and smiles wryly. It was the endocrinologist who asked her if she had been on the Ronald Reagan. During Tomodachi? Yes, Morales told her. Why?

The doctor answered that he had removed six thyroid glands in recent months from sailors who had been on that ship, Morales relates. Only then did Morales make the connection between the worst accident in the history of civilian atomic power and her own fate. The Fukushima catastrophe changed the world. Nuclear reactors melted down on live television and twice as much radioactive material was released as during the Chernobyl accident in 1986. The disaster drove 150,000 people from their towns and villages, poisoned entire landscapes for centuries and killed hundreds of thousands of farm animals. It also led countries around the world to rethink their usage of nuclear energy. Fukushima is more than just a place-name, it is an historical event – and it would seem to have changed the life of Leticia Morales as well.

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“It doesn’t make them happy – it’s a cover-up. We get so busy maintaining stuff, keeping it, making sure there’s a place for it. It’s not greed. It’s trying to fill up a hole that’s so big it will never be filled..”

The Stuff Paradox: Dealing With Clutter In The US (BBC)

While more and more Americans struggle to make do with less due to economic hardship, others are making a conscious choice to shed their possessions. When Courtney Carver was diagnosed with multiple sclerosis in 2006, she took a long, hard look at her life and decided to focus on only the things that were really important. And that meant reducing the amount of “stuff” cluttering her space and her time. “At first it seemed completely overwhelming and not manageable,” she recalls. “Even the thought of decluttering my closet felt like this huge accomplishment, and paying off tens of thousands of dollars of debt felt impossible.” But Carver persevered and discovered that casting off her possessions also reduced her stress levels and she began to feel better. “I’m not saying crazy lifestyles cause illness, but they certainly exacerbate issues,” she says.

“Freeing up a lot of resources allows me to give more of my time and attention and money to things that I care about.” She began blogging about her experience and eventually left her advertising job in Salt Lake City, Utah, to launch a website BeMoreWithLess.com. Her Project 333 – how to pare down a wardrobe to just 33 items – has attracted a large online following and she has just launched a similar initiative to reduce food in the kitchen. The point is to free up time and mental energy that would otherwise be spent on the everyday preoccupation of eating and fashion. Of course minimalism itself is nothing new. Some of the ancient Greek philosophers were advocates, most religions extol the virtues of austerity and figures as diverse as the Russian novelist Leo Tolstoy and the Indian civil rights leader Mahatma Gandhi have preached the benefits of a simple life. But a recent survey reveals that 54% of Americans feel overwhelmed by clutter and 78% have no idea what to do with it. [..]

Bev Hitchins is the founder of Align, a professional decluttering service based in Alexandria, Virginia. She has never met some of her clients and often provides counselling online. “I work with people who are poised to make a change,” she says. “They realise they’re stuck and have to do something about it. One of the easiest ways to get unstuck is to declutter.” That’s because most people accumulate possessions for psychological reasons, she says. “People gather stuff to protect themselves. It’s an illusion though. It doesn’t make them happy – it’s a cover-up. We get so busy maintaining stuff, keeping it, making sure there’s a place for it. It’s not greed. It’s trying to fill up a hole that’s so big it will never be filled. “But there’s a tremendous transformation that goes on if they stay with the process. You can go into therapy or you can start decluttering.”

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“I think when you make a film like American Sniper you have to be in decline.. You’re not a world leader any more..”

American Sniper Is A Movie Hitler ‘Would Have Been Proud To Have Made’ (Ind.)

The British documentarian Nick Broomfield has said that the controversial biopic American Sniper is a film which Adolf Hitler would have been proud to have made. In an interview for The Independent Magazine, the award-winning filmmaker branded it an example of ‘American fascism’ that made him question his decision to live in the United States. “After you’ve watched a film like American Sniper, you think “My God, what the fuck am I doing here?” He went on to say: “I think Adolf would have been proud to have made it”. Directed by Clint Eastwood, American Sniper is a biopic of the Navy SEAL sniper Chris Kyle, played by Bradley Cooper. Based on Kyle’s memoir, the film tells the story of how he rose to legendary status within the armed forces by making 164 confirmed “kills” during four tours in Iraq.

The film has been a runaway success at the US box office. American sniper Chris Kyle had over a 100 ‘kills’ to his name American sniper Chris Kyle had over a 100 ‘kills’ to his name Asked whether he agreed with criticism of America Sniper as propagandist Broomfield – who is promoting his new documentary Tales of the Grim Sleeper – labelled it a product of a country locked in an existential struggle with its own history and future. “It’s been amazing watching the whole Obama thing. Just seeing how deep-rooted it [American fascism] is. That’s really what Tales of the Grim Sleeper is about: incredible racism that really goes back to slavery and the country has not in any way got over it. “I think when you make a film like American Sniper you have to be in decline,” he added.

“You’re holding on to your bootstraps and you’re turning inwards. You’re not a world leader any more. I think it makes people very insecure and they sort of retreat to their most basic fears .The fact that that film has been such a touchstone here is worrying.” [..] Broomfield’s new documentary, Tales of a Grim Sleeper, investigates the murders of over 150 prostitutes, mostly African-American, in South Central Los Angeles. It is Broomfield’s 30th documentary – a number of which have been set in the US. “If you were making films in the 1850s when the British Empire was pre-eminent, you would undoubtedly be more interested about making films in Britain, about British people,” he explained. “But I think, in a way, it’s about to change. People look to the United States for things that are about to happen in the future.”

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Jan 262015
 
 January 26, 2015  Posted by at 11:33 am Finance Tagged with: , , , , , , ,  


DPC Levee, Ohio River at Louisville, Kentucky 1905

Tsipras Forges Anti-Austerity Coalition Within Hours Of Victory (Bloomberg)
Greece Shows What Happens When The Young Revolt Against Corrupt Elites (Guardian)
Anti-Austerity Syriza Leader Tsipras Vows To End ‘Pain and Humiliation’ (BBC)
‘For Five Years Greece Has Been Like A Patient Slowly Bleeding’ (Guardian)
Syriza Faces ‘Uphill Battle’ In Coming Hours (CNBC)
Syriza’s Historic Win Puts Greece On Collision Course With Europe (Guardian)
Prices in Europe Continue to Sink, Showing Why Draghi Had to Act (Bloomberg)
Is The Euro The Charlie Brown Of Currencies? (CNBC)
For Saudis, Falling Demand for Oil Is the Biggest Concern (Bloomberg)
Oil Slides to Near 6-Year Low (Bloomberg)
China Bull Market Masks Momentum Breakdown as Stock Volumes Sink (Bloomberg)
China Property Agony Deepens as Trust-Loan Lifelines Cut (Bloomberg)
China Bank Fraud Case Shocks Nation (MarketWatch)
UK Chancellor Osborne Urges Ministers To Fast-Track Fracking (Guardian)
Obama Moves to Put Much of Arctic Refuge Off Limits to Drilling (Bloomberg)
“Out Of My Face Please” – Why Are US Soldiers In Mariupol? (Zero Hedge)
Panic in Kiev? (Dmitry Orlov)
Michael Moore’s ’American Sniper’ Firestorm Rages On (MarketWatch)
American Sniper Illustrates The West’s Morality Blind Spots (Guardian)
Japan Is Trying To Figure Out How To Get Its People To Have More Sex (Bloomberg)
US East Coast Braces For ‘Biggest Snowstorm In History’ (Reuters)

Fast track: “The prime minister will meet with the president today for his swearing in ceremony, and will announce the government’s composition, in which we will take part.”

Tsipras Forges Anti-Austerity Coalition Within Hours Of Victory (Bloomberg)

Greek Prime Minister-elect Alexis Tsipras forged an anti-austerity alliance within hours of his election victory, challenging European peers with a declaration that the era of bowing to international demands for budget cuts is over. Tsipras’s Syriza party and the Independent Greeks announced their coalition in Athens Monday morning after Syriza won an historic victory in elections by harnessing a public backlash against years of belt-tightening, job losses and hardship. In his victory speech, Tsipras said his priority is “for Greece and its people to regain their lost dignity.”

The Independent Greeks party will support Syriza in a vote of confidence in Parliament slated for Feb. 5, party leader Panos Kammenos told reporters after meeting with Tsipras. The Syriza leader will meet with President Karolos Papoulias at 3:30 p.m. in Athens to receive the mandate to govern. “As of this moment there’s a government in Greece,” said Kammenos. “The prime minister will meet with the president today for his swearing in ceremony, and will announce the government’s composition, in which we will take part.”

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“In all of drama and comedy there is no figure more laughable than a rich man who does not know what he is doing. For the past four years the troika has provided Greeks with just such a spectacle.”

Greece Shows What Happens When The Young Revolt Against Corrupt Elites (Guardian)

At Syriza’s HQ, the cigarette smoke in the cafe swirls into shapes. If those could reflect the images in the minds of the men hunched over their black coffees, they would probably be the faces of Che Guevara, or Aris Velouchiotis, the second world war Greek resistance fighter. These are veteran leftists who expected to end their days as professors of such esoteric subjects as development economics, human rights law and who killed who in the civil war. Instead, they are on the brink of power. Black coffee and hard pretzels are all the cafe provides, together with the possibility of contracting lung cancer. But on the eve of the vote, I found its occupants confident, if bemused. However, Syriza HQ is not the place to learn about radicalisation. The fact that a party with a “central committee” even got close to power has nothing to do with a sudden swing to Marxism in the Greek psyche.

It is, instead, testimony to three things: the strategic crisis of the eurozone, the determination of the Greek elite to cling to systemic corruption, and a new way of thinking among the young. Of these, the eurozone’s crisis is easiest to understand – because its consequences can be read so easily in the macroeconomic figures. The IMF predicted Greece would grow as the result of its aid package in 2010. Instead, the economy has shrunk by 25%. Wages are down by the same amount. Youth unemployment stands at 60% – and that is among those who are still in the country. So the economic collapse – about which all Greeks, both right and leftwing, are bitter – is not just seen as a material collapse. It demonstrated complete myopia among the European policy elite. In all of drama and comedy there is no figure more laughable as a rich man who does not know what he is doing.

For the past four years the troika – the European Commission, IMF and European Central Bank – has provided Greeks with just such a spectacle. As for the Greek oligarchs, their misrule long predates the crisis. These are not only the famous shipping magnates, whose industry pays no tax, but the bosses of energy and construction groups and football clubs. As one eminent Greek economist told me last week: “These guys have avoided paying tax through the Metaxas dictatorship, the Nazi occupation, a civil war and a military junta.” They had no intention of paying taxes as the troika began demanding Greece balance the books after 2010, which is why the burden fell on those Greeks trapped in the PAYE system – a workforce of 3.5 million that fell during the crisis to just 2.5 million.

The oligarchs allowed the Greek state to become a battleground of conflicting interests. As Yiannis Palaiologos, a Greek journalist, put it in his recent book on the crisis, there is “a pervasive irresponsibility, a sense that no one is in charge, no one is willing or able to act as a custodian of the common good”. But their most corrosive impact is on the layers of society beneath them. “There goes X,” Greeks say to each other as the rich walk to their tables in trendy bars. “He is controlling Y in parliament and having an affair with Z.” It’s like a soap opera, but for real, and too many Greeks are deferentially mesmerised by it.

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High time.

Anti-Austerity Syriza Leader Tsipras Vows To End ‘Pain and Humiliation’ (BBC)

Anti-austerity Syriza party leader Alexis Tsipras has vowed to end Greece’s “five years of humiliation and pain” after his general election win. Before cheering supporters, Mr Tsipras again pledged to renegotiate Greece’s massive international bailout. With nearly all of the votes counted in Sunday’s poll, Syriza looks set to have 149 seats, just two short of an absolute majority. Syriza’s victory has raised fears about Greece’s future in the euro. Greece has endured tough budget cuts in return for its 2010 bailout, worth €240bn and negotiated with the so-called troika – the EU, IMF and ECB. The economy has shrunk drastically since the 2008 global financial crisis, and increasing unemployment has thrown many Greeks into poverty. Syriza’s election result will send shockwaves through Europe, the BBC’s Gavin Hewitt in Athens says.

A majority of voters in Greece have essentially rejected a core policy for dealing with the eurozone crisis as devised by Brussels and Germany, our correspondent adds. The election result is expected to be one of the main issues at Monday’s meeting of 19 eurozone finance ministers. In Germany, Bundesbank President Jens Weidmann said he hoped “the new Greek government will not make promises it cannot keep and the country cannot afford”. Belgian Finance Minister Johan Van Overtveld was quoted by VRT network as saying that Greece “must respect the rules of monetary union”, although he added that there was room for some flexibility. In Italy, EU Affairs Minister Sandro Gozi said: “After this vote we will have new opportunities to pursue change in Europe to create growth and investment and fight against unemployment.”

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From last week by Helena Smith.

‘For Five Years Greece Has Been Like A Patient Slowly Bleeding’ (Guardian)

“I will drive you to the wound of Greece. It won’t take long.” Tall, muscular and dark, Antonis is not a man given to hyperbole but he is, by his own admission, very angry. Now, staring into his rear-view mirror – only days before elections that could make or break Athens’ tumultuous ties with Europe – there is no hiding how incensed he is. “What has happened to this country is a catastrophe,” he fumes. “Our politicians, Europe, the IMF, they have stopped us having dreams.” The journey to the wound of Greece does not take long. For Antonis, a photographer with an eye for the unusual, it is not at the end of the pot-holed road we are driving down.

It is everywhere: in the mamas and papas scavenging through the rubbish bins, the broken pavements and shuttered shops, the abandoned cars and derelict houses, the new poor who mutter to themselves on graffiti-stained streets. “It is the loss of hope,” he says with a thump of his steering wheel. “I see it every day, a wound that will not heal. Please write that I, Antonis, hate this country, I hate everything about it.” For the 43-year-old, rage has been shaped by fate, one shared by over 1.3 million Greeks since their debt-stricken nation’s financial meltdown. In 2010, under the punitive effect of austerity – the price of the biggest bailout in western history – the Athenian photographic studio that employed him unexpectedly collapsed.

Overnight, he found himself out of work, another statistic in the record number of jobless thrown up by a crisis born in Athens that has reverberated through every EU capital since. “Unless they are stupid, or rich, no Greek has children anymore,” snarled Mavros who has been forced into the taxi driving business to make ends meet. “My predicament has denied me having the second child I always wanted.” It has also brought him face to face with the unravelling of a country that, five anguished years later, is torn between the agonising choice of yet more austerity, or voting in young insurgents who could put it on a devastating collision course with the EU and IMF, the creditors keeping it afloat.

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“But it’s ultimately going to be much more difficult to figure out exactly what policies they will ultimately agree..”

Syriza Faces ‘Uphill Battle’ In Coming Hours (CNBC)

As a victorious Syriza focuses on talks to find an ally to build a new Greek government, the left-wing party faces even more immediate and pressing problems, according to Greek politicians. Global markets are jittery as investors digest news that anti-bailout Syriza won a general election in Greece on Sunday. The party, led by Alexis Tsipras, is now in talks with the right-wing – and also anti-austerity — Independent Greeks party in order to form a coalition but are also due to meet the more centrist To Potama and Communist parties later today for coalition negotiations.

Talks are expected to continue over the next few days but could be concluded within hours, according to one former government minister. “By the end of the day we should have a coalition between these two parties (Syriza and Independent Greeks) but also there are other willing parties that are willing and available (to form a coalition) too,” Petros Doukas, former deputy finance minister of Greece, told CNBC Monday morning. “But it’s ultimately going to be much more difficult to figure out exactly what policies they will ultimately agree,” he said, adding that it would be an “uphill battle” for Syriza and the Independent Greeks – coming from the left and right of the political spectrum – to agree on policy.

“It’s going to be an uphill battle between Syriza and their left-wing promises, which they will not be able to deliver absolutely because they have some major problems to tackle immediately (such as) the banking problem and social security problems – there’s seven billion euros (worth of debt) maturing in March and they need European liquidity support for that,” Doukas said.

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“Greece’s incumbent prime minister, Antonis Samaras, conceded defeat early in the evening and admitted that “mistakes and injustices” had been made but insisted he was leaving office with a clear conscience. ”

Syriza’s Historic Win Puts Greece On Collision Course With Europe (Guardian)

European politics has been plunged into a volatile new era following a historic victory in Greece’s general election by far-left radicals committed to ending years of austerity. More than five years into the euro crisis that started in Greece in October 2009 and raised questions about the single currency’s survival, Greek voters roundly rejected the savage spending cuts and tax rises imposed by Europe which reduced the country to penury. Voters handed power to Alexis Tsipras, the charismatic 40-year-old former communist who leads the umbrella coalition of assorted leftists known as Syriza. He cruised to an eight-point victory over the incumbent centre-right New Democracy party, according to exit polls and projections after 93% of votes had been counted.The result surpassed pollster predictions and marginalised the two mainstream parties that have run the country since the military junta’s fall in 1974.

It appeared last night, however, that Syriza would win 149 seats – just short of securing the 151 of 300 seats that would enable Tsipras to govern without coalition partners. “The sovereign Greek people today have given a clear, strong, indisputable mandate,” Tsipras told a crowd of rapturous flag-waving party supporters. “Greece has turned a page. Greece is leaving behind the destructive austerity, fear and authoritarianism. It is leaving behind five years of humiliation and pain.” Greece’s incumbent prime minister, Antonis Samaras, whose conservative-dominated coalition had been in office since June 2012, conceded defeat early in the evening and admitted that “mistakes and injustices” had been made but insisted he was leaving office with a clear conscience. “I assumed charge of a country that was on the brink of collapse … and we restored its international credibility,” said Samaras.

Tsipras’s victory, widely predicted, was nonetheless stunning in scale and in impact. Single-party majorities are very rare in parliamentary systems in Europe these days, in recent years occurring in only Hungary and Slovakia under strongman leaders of the right and left. For an upstart party such as Syriza, which has never been tested in power, the victory highlighted how five years of fiscal orthodoxy in Europe have turned politics upside down.“I just voted for the party that’s going to change Greece; in fact, the party that is going to change the whole of Europe,” said Panagiotis, 54, a self-employed electrician voting in the Kipseli district of Athens. “There has to be change, big change. The economy has collapsed … Syriza is Greece’s hope.”

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Something to check by year-end: “Professional forecasters surveyed by the ECB before the QE announcement saw price growth of 0.3 % this year and 1.1 % in 2016. The bond-buying program is seen adding 0.4 percentage point and 0.3 percentage point respectively”

Prices in Europe Continue to Sink, Showing Why Draghi Had to Act (Bloomberg)

Mario Draghi’s reasons for flooding the euro area with money will be laid bare once again this week. Days after the European Central Bank president announced a €1.1 trillion ($1.2 trillion) stimulus plan, data may show prices in the euro area are falling at close to the fastest pace since the shared currency was introduced 16 years ago. Sinking prices, together with stubbornly high unemployment, will reinforce the picture of economic weakness that convinced the Frankfurt-based central bank to go ahead with the controversial purchase of government bonds. Anticipation of more action from Draghi to prevent a deflationary spiral lifted German investor confidence this month and that may be echoed in a euro-wide sentiment index on Thursday. “We’re seeing a moderate recovery, but the big question is, is it strong enough to get inflation back up over the relevant time horizon?” said Nick Kounis, head of macro research at ABN Amro.

“It helps the story if things start to move a bit more in the right direction and then he can get another round of Super Mario credit.” While the ECB’s decision to start full-blown quantitative easing was widely anticipated, the size of the program exceeded forecasts. With monthly purchases of 60 billion euros until at least September 2016, the total was double economists’ projections. Even with that scale, it’s unclear whether the stimulus will be enough to push inflation back toward the ECB’s goal of just under 2 %. Professional forecasters surveyed by the ECB before the QE announcement saw price growth of 0.3 % this year and 1.1 % in 2016. The bond-buying program is seen adding 0.4 percentage point and 0.3 percentage point respectively, according to a euro-area central bank official who has seen the ECB’s internal calculations.

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“That may be optimistic, with RBS saying the currency could fall toward record lows closer to $0.80..”

Is The Euro The Charlie Brown Of Currencies? (CNBC)

The euro may be the Charlie Brown of currencies, as like the comic character, it’s under a cloud of negatives, including the Greek election outcome, with analysts tipping further downside. “It’s the ugliest horse in the glue factory,” Jeffrey Halley at Saxo Capital Markets, told CNBC, advising selling it against all other G-10 currencies. The common currency nipped down, trading as low as $1.1098 in Asian hours Monday, its lowest since late 2003 although it later recovered to around $1.1174, after news Greece’s anti-austerity party Syriza looked set to win at least 149 seats in the 300 seat parliament – a larger-than-expected margin. The party ran on a platform of increasing spending and seeking forgiveness of some of its debt, with the rhetoric raising concerns Greece could dig in its heels on its bailout deal with the European Union, possibly defaulting on its bonds or exiting the common currency.

“Doubts over whether the EU bailout program (expiring on February 28) will be extended should keep Greek bonds and the euro under pressure,” Mizuho Bank said in a note Monday. It has a forecast for the euro to slip as lows as $1.0950. That may be optimistic, with RBS saying the currency could fall toward record lows closer to $0.80, although parity with the U.S. dollar is more likely in the meantime. The euro last traded at parity with the U.S. dollar in late 2002, in the wake of the dot-com bust and the late 2001 terrorist attacks in the U.S. “[The Greek election outcome] is something that’s going to generate a long debate on austerity with no real outcome for months,” said Greg Gibbs, senior foreign exchange strategist at RBS. “It’s another distraction.” The euro isn’t likely to find a bottom until the continent can produce “significantly” stronger inflation accompanied by stronger economic data, Gibbs said.

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“Nobody should imagine the world will continue to demand oil as long as you have it in your fields..”

For Saudis, Falling Demand for Oil Is the Biggest Concern (Bloomberg)

As the world’s oil producers wring their hands over a global glut that’s pushing down prices, evidence is mounting that Saudi Arabia is more concerned about shrinking demand. The world’s largest exporter has chosen not to cut production, counting instead on lower prices to stimulate consumption, said Mohammad Al Sabban, an adviser to Saudi Arabia’s petroleum minister from 1988 to 2013. The Saudis are keeping an eye on investments in fuel efficiency and renewable energy, according to Francisco Blanch, Bank of America Corp.’s head of global commodity research. “Nobody should imagine the world will continue to demand oil as long as you have it in your fields,” Al Sabban said in an interview. “We need to prepare ourselves for that stage.”

The U.S. shale revolution showed that forecasts of dwindling world oil supply were premature. It also gave credence to the old adage, attributed to a Saudi oil minister more than 30 years ago, that the Stone Age didn’t end because of the lack of stone. With costs falling for clean energy and international attention focused on slowing climate change, the Saudis are more worried that the world is inching closer to peak demand. Among industrialized countries, that peak was reached 10 years ago, according to the Paris-based International Energy Agency, and fast-developing countries such as India and China won’t become as carbon-intensive, Al Sabban said.

Oil supplied 31 % of the world’s energy in 2012, compared with 46 % in 1973, the IEA said. Even as oil prices dropped 48 % last year, the most since 2008, global production rose 2.1 % to 93.3 million barrels a day, according to the IEA. The price plunge was caused by years of record-high prices that spurred expanding supplies while impairing demand – and not a Saudi conspiracy, Al Sabban said. Saudi Arabia and other members of the Organization of Petroleum Exporting Countries hope cheap energy will foster economic growth and, in turn, more oil consumption, he said.

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Wow!: “U.S. inventories climbed to 383.5 million barrels last month, the highest level for December since 1930..”

Oil Slides to Near 6-Year Low (Bloomberg)

Oil fell to the lowest level in almost six years as signs that Saudi Arabia’s new king will maintain its production policy and rising U.S. crude stockpiles bolstered speculation that a global glut will persist. Futures dropped as much as 2.7% in New York, extending a 6.4% slide last week. King Salman Bin Abdulaziz, who took over after the death of King Abdullah on Jan. 23, pledged to maintain the policies of his predecessor. U.S. inventories climbed to 383.5 million barrels last month, the highest level for December since 1930, the American Petroleum Institute reported. Oil slumped almost 50% last year as OPEC resisted calls to cut output even as the U.S. pumped at the fastest pace in more than three decades.

Saudi Arabia, the world’s biggest exporter, has chosen not to reduce supply and count instead on lower prices to stimulate demand, according to Mohammad Al Sabban, an adviser to the kingdom’s petroleum minister from 1988 to 2013. “Crude production needs to slow down first to decelerate the speed of stockpiling, which is seen to be even faster than during the 2008 financial crisis,” Hong Sung Ki, a commodities analyst at Samsung Futures, said by phone. “With Saudi Arabia, the market hardly reacted last week and will remain unchanged as King Salman is known to be very conservative.” West Texas Intermediate for March delivery decreased as much as $1.24 to $44.35 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 72 cents to $45.59 on Jan. 23, the lowest close since March 2009. The volume of all futures traded was more than double the 100-day average.

Brent for March settlement slid as much as 94 cents, or 1.9%, to $47.85 a barrel on the ICE Futures Europe exchange. It gained 27 cents to $48.79 on Jan. 23. The European benchmark crude traded at a premium of $3.26 to WTI. Crude stockpiles in the U.S., the world’s largest oil consumer, increased 7.4% in December from a year ago, the API in Washington said in a monthly report on Jan. 23. Production accelerated 16% to 9.12 million barrels a day, the highest level for any month since February 1986, according to the industry group.

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Both stocks and property bubbles now at risk of popping.

China Bull Market Masks Momentum Breakdown as Stock Volumes Sink (Bloomberg)

Just below the surface of China’s world-beating equity rally, signs of trouble are emerging. While the Shanghai Composite Index touched a five-year high on Friday after a 63% gain during the past year, other gauges of investor enthusiasm are tumbling. Turnover sank 47% from its peak in December, while new equity account openings fell 50% and purchases using borrowed money dropped 38%. The number of stocks reaching new 52-week highs has declined 75% in the past six weeks. The indicators suggest to Deutsche Bank and Fortune SG that China’s mainland-traded A shares are no longer a one-way bet after monetary stimulus and a flood of new individual traders propelled the Shanghai gauge to 8 consecutive months of gains through December. Windsor Capital, one of China’s top 10 performing hedge funds, said last week investors will have to wait until the middle of this year before the $5.1 trillion market resumes its advance.

“We have seen fewer new account openings, narrower trading turnover and heightened market volatility recently in the A-share market,” Yuliang Chang at Deutsche Bank, Germany’s largest lender, said in e-mailed comments on Jan. 23. “This does not bode well for this liquidity-driven rally.” Chinese investors opened about 447,000 accounts to trade equities in the week to Jan. 16, down from a seven-year high of 892,000 in mid-December, while the number of accounts with transactions fell 29%. The value of shares traded on the Shanghai exchange has dropped to 420.7 billion yuan ($67.5 billion) from a record 792.7 billion yuan on Dec. 9. Meanwhile, the number of Shanghai Composite stocks recording new 52-week highs fell to 55 last week from 218 in December. Volatility has also increased, with a gauge of 30-day swings in the Shanghai index reaching a five-year high.

Government efforts to cool the growth of margin loans have curbed one of the biggest drivers of the rally. Stock purchases using borrowed money on the Shanghai exchange declined to 75.1 billion yuan on Jan. 22 from their Dec. 9 record of 121.8 billion yuan after policy makers suspended three of the nation’s biggest brokerages from loaning money to new equity-trading clients and said securities firms shouldn’t lend to investors with assets below 500,000 yuan.

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This is really about shadow banking.

China Property Agony Deepens as Trust-Loan Lifelines Cut (Bloomberg)

China’s investment trusts are pulling financing for the real estate industry as Kaisa’s missed payments heighten default concerns. Issuance of property-related products, which channel money from wealthy individual investors, tumbled 62% from a year earlier to 38.5 billion yuan ($6.2 billion) in the fourth quarter, data compiled by research firm Use Trust show. Builders must repay 241 billion yuan of trusts in 2015, up from 178 billion yuan last year. Kaisa, which missed a bond coupon payment this month, failed to repay a 2.5 billion yuan trust last week, people familiar with the matter said. “The record amount of trust products due is adding to the agony of property developers as they face a withering funding lifeline,” said Shuai Guorang, an analyst at Use Trust. “Investor demand for property trusts has declined as they are concerned about developers’ cash supply.”

While Premier Li Keqiang’s relaxation of property curbs has helped underpin a rebound in home sales, investors are speculating more developers may be caught up in an anti-corruption drive. Kaisa, Agile Property and Hydoo, which builds large-scale trade centers, have been linked to probes. Local authorities in Handan, southwest of Beijing, sent work teams into 13 developers after failure to repay funds, Xinhua News Agency reported. “A big portion of shadow bank funding, including trust financing, is borrowed by property developers,” said David Cui, China strategist at Bank of America. “If there is a sharp rise of defaults by the developers, it may cause a shock to investor confidence in shadow banking, which will raise risks of a credit crunch.” The number of publicly traded real estate firms with debt exceeding equity has increased to 135 out of 336 from 57 in 2007, according to data compiled by Bloomberg. “Chinese companies’ leverage ratio is too high,” said BOA’s Cui. “The probability of a credit crunch at some point is high.”

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“..after a man was wrongly jailed [for 4 years] for trying to recover money stolen by a bank employee.”

China Bank Fraud Case Shocks Nation (MarketWatch)

China’s central bank and its top financial regulator are vowing action against the theft of bank depositors’ money, an issue that has entered the spotlight after a man was wrongly jailed for trying to recover money stolen by a bank employee. The man in question is Zhang Jing, the former chairman of a listed battery company in the southwestern city of Chongqing. Zhang is currently negotiating with a local branch of Agricultural Bank of China after he spent four years in jail for suing the bank over his missing deposit of more than 1.2 million yuan ($192,000), according to a report Monday in the government-owned Changjiang Business Daily. Zhang had sued state-owned AgBank back in 2005, but when the lender claimed ignorance of any missing funds, Zhang found himself arrested and sentenced to four years in prison, along with a 100,000-yuan fine, for “defrauding public property” from AgBank.

After Zhang was released from prison in 2010, he sought redress from the Supreme Court and finally got his case corrected in December last year, the report said. “This is extremely ridiculous,” the newspaper quoted Gao Yifei, a professor at the Southwest University of Political Science and Law, as saying. “The judges from first and second instances were very rash” in their judgement. And Zhang is by no means alone — other Chinese savers have found their deposits at state banks have gone missing, only to see the bank claim no fault in the incidents. A combined 95 million yuan worth of deposits from 42 separate accounts have reportedly disappeared at the United Rural Cooperative Bank of Hangzhou, located in the eastern province of Zhejiang, the state-run Xinhua News Agency said Sunday in a special report.The missing funds turned out to be the result of an employee and her accomplices stealing passcodes, with two of the suspects now under arrest.

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British democracy: “..can “at his discretion” take the power to overrule planning decisions.”

UK Chancellor Osborne Urges Ministers To Fast-Track Fracking (Guardian)

George Osborne has requested that ministers make dozens of interventions to fast-track fracking as a “personal priority”, including the delivery of numerous “asks” from shale gas company Cuadrilla. The list of requests are laid out in a leaked letter to the chancellor’s cabinet colleagues. They include interventions in local planning, and offering public land for potential future drilling. Anti-fracking campaigners claim the letter reveals collusion with the industry, while Labour said it showed the government was an “unabashed cheerleader for fracking”. The revelations come on the day of a Commons vote on fracking – the first MPs have had on the issue – and just hours after an influential cross-party committee of MPs published a report calling for a fracking moratorium because of potential risks to public health and climate change.

The UK’s first planning applications for full-scale fracking are also set be decided this week, with Lancashire county councillors to begin deliberations on Wednesday – having already been advised to refuse the proposals by planning officials. David Cameron has said the government is “going all out” for shale gas in the UK, claiming it would create thousands of jobs, benefit community investment and cut reliance on imports. But opponents argue that high-pressure fracturing of rocks to release gas risks health and environmental impacts and will undermine the country’s climate change goals.In Osborne’s six-page letter, dated 24 September, to the high-level cabinet committee on economic affairs, the chancellor demands “rapid progress” on “reducing risks and delays to drilling” from Ed Davey, Eric Pickles, Vince Cable, Liz Truss and other ministers.

Top of the list is to “respond to the asks from Cuadrilla”, the company intending to frack in Lancashire. The “asks” include contacting the Health and Safety Executive and Lancashire county council about planning applications, and the Ministry of Defence over granting Cuadrilla trucks access to military land. In his preamble, the chancellor writes: “I expect to see rapid progress” on the recommendations. The letter, leaked to Friends of the Earth and seen by the Guardian, also includes moves to enable full shale gas production in future, such as ensuring that Pickles, whose communities department oversees planning, can “at his discretion” take the power to overrule planning decisions.

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Excellent.

Obama Moves to Put Much of Arctic Refuge Off Limits to Drilling (Bloomberg)

President Barack Obama will take steps to restrict 12 million acres of the Arctic National Wildlife Refuge from oil and gas exploration, a move denounced by Alaskan lawmakers who have fought for years to open the area up to drillers. The administration on Sunday announced a plan to add protections to the refuge and also called on Congress to designate “core areas” of the 19.8 million-acre refuge as wilderness, including its Coastal Plain, according to a statement from the Interior Department. The designation is the highest level of protection from development that’s available to public lands, according to the department. “Designating vast areas in the Arctic National Wildlife Refuge as wilderness reflects the significance this landscape holds for America and its wildlife,” Interior Secretary Sally Jewell said in the statement.

The administration and the U.S. Senate’s new Republican majority are already in conflict over energy issues, from climate change to construction of the Keystone pipeline from Canada. The arctic region represents one of the nation’s largest known petroleum reserves, though harsh conditions and environmental concerns have hampered exploration and development. Approval of a wilderness designation from the Republican-controlled Congress is “highly unlikely” with Alaska Republican Lisa Murkowski as chairman of the Senate’s key energy committee, said Cindy Shogan, executive director of the Alaska Wilderness League, an environmental group.

Shogan said the proposal is nonetheless significant because it reverses a White House position made to Congress by President Ronald Reagan in 1987 recommending oil drilling in the refuge. More than 7 million acres of the wildlife refuge are now protected as wilderness. Obama’s proposal would expand that territory and include for the first time the Coastal Plain. The Interior Department said the refuge is home to most diverse wildlife in the Arctic, including caribou, polar bears, wolves and muskoxen. It was established in 1960 by President Dwight Eisenhower and expanded in 1980 under President Jimmy Carter, according to the Alaska Wilderness League, which applauded Obama’s move. “This is a big deal,” Shogan said. “In the history of the Arctic Refuge, this is the closest that we have come to advancing Wilderness for the Coastal Plain.”

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What a surprise! Link to clip in Orlov’s article just below.

“Out Of My Face Please” – Why Are US Soldiers In Mariupol? (Zero Hedge)

Amid the devastation of yesterday’s Mariupol artillery strikes which killed or wounded dozens, which was promptly blamed by both sides on the “adversary” – and has been proclaimed by both ‘sides’ (more on that later) as more violent than before the truce – an ‘odd’ clip has emerged that appears to provide all the ‘proof’ a US intelligence officer would need to surmise that US military boots are on the ground in Ukraine. As the following clip shows, a Ukrainian journalist approaches what she thinks is a Ukrainian soldier (since he is wearing a Ukrainian military uniform and is carrying an AK) and asked him as they run through the battlezone, “tell me, what happened here?” His response, which requires no translation, speaks for itself.

With daily reportage of the ‘invasion’ of Russian military forces into Ukraine territory (admittedly unconfirmed by NATO), this clip raises many questions about American involvement in the ongoing conflict – most of all, was the US involved in the “staging” the Mariupol massacre, and if so it is clear who should be blamed (and isolated). Of course, US troops, or at least mercs, on the ground, should not be a total surprise, since just 2 months ago, we discussed the hacked US documents that revealed the extent of undisclosed US “lethal aid” being given to the Ukraine army. What was apparently left unleaked was the part of the US aid also includes US-speaking soldiers. The only question is whether US taxpayers are paying their wages.

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“Local authorities in Ukrainian-controlled districts near the front report that Ukrainian soldiers are deserting with their weapons and taking to looting the countryside in increasing numbers.”

Panic in Kiev? (Dmitry Orlov)

The following article appeared briefly at this URL on censor.net.ua and was quickly pulled down. Ironic? It would seem so. My translation. I bring it to you because it succinctly lays out the situation as I’ve been able to piece it together from multiple Russian- and Ukrainian-language sources, and because you are unlikely to come across anything this truthful from cough Western media cough.

“Panic in Kiev: Ukrainian forces surrender Donbass”

International observers report of growing panic in Kiev in connection with the successful counteroffensive of the separatists near Donbass. Over a week of fighting the partisans have delivered a heavy blow to the Ukrainian forces. The group of Ukrainian fighters in Donbas suffered huge losses, the soldiers are demoralized, the officers are confused and unable to control the situation. Ukrainian military leadership is seriously concerned of a new encirclement near Debaltsevo, as well as in other areas. The situation is made worse by the fact that army and national guard reserves are almost completely depleted, and plugging the gaps in defense using small formations cannot stabilize the front. Besides, the Ukrainian forces are running low on ordnance, food and medical supplies.

In turn, the partisan field commanders report 752 killed Ukrainian military personnel, 59 destroyed tanks and a large number of people taken prisoner. In view of their combat successes, the partisans are refusing to take part in any further negotiations in the format of the Minsk agreements and threaten to continue the counterattack. Local authorities in Ukrainian-controlled districts near the front report that Ukrainian soldiers are deserting with their weapons and taking to looting the countryside in increasing numbers. In this critical situation the military is afraid to report to president Poroshenko the real situation in the southeast of the country, hiding from him the full scale of the catastrophe.The head of state is still convinced that the situation is under control, and hopes that in case of a real threat he will still have the chance to ask the West for help.

And then there is this video evidence: American “boots on the ground” have invaded Eastern Ukraine. How do you say “Get out of my face, please!” in Ukrainian? I guess the grunts aren’t taught that in Basic Training… are they too busy learning how to shell civilians and then blame the other side?

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Moore in fine form: “I tried to save more lives than a sniper ever could hope to — by preventing us from going to war in the first place..”

Michael Moore’s ’American Sniper’ Firestorm Rages On (MarketWatch)

Filmmaker Michael Moore, an expert courter of controversy, has been pilloried over the past few days by some on the right, including the likes of Sarah Palin and Kid Rock, for incendiary words he tweeted about the “American Sniper” film. Newt Gingrich went so far as to suggest Moore should spend some time with ISIS and Boko Haram. This is what started it all:

After catching flak for his contentious remarks, Moore took to Facebook on Sunday to hit back at those accusing him of hating the troops. Damage control, it wasn’t. “Well, who would know better about hating our troops than those who supported sending them into a senseless war Iraq in the first place? And, for 4,482 of them, a senseless, unnecessary and regrettable death,” he wrote. “If you supported that invasion, if you voted for George W. Bush and the Republicans and Democrats who backed this war, then you are the ones who have some ‘splainin’ to do. Not me. You.” He went on to list the ways in which he’s proven his support of the troops. For one, when his dad died, Moore asked that instead of flowers, donations be sent to the Veterans of Peace. He also mentioned how he pushes businesses to hire vets, raises money for wounded soldiers and offers free admission for military personnel and their families at his theater in Michigan.

Moore also took a swipe at the director of the film. “You can’t have a conversation about what Clint Eastwood is up to if you haven’t seen what it is he’s up to,” he wrote. “Eastwood made maybe the greatest Western ever — ‘Unforgiven’ — but now it’s sad seeing him talking to an empty chair on a stage or making an Iraq movie that Rolling Stone this week called ‘too dumb to bother criticizing.’” Then he took a parting shot directly at his network nemesis. “I tried to save more lives than a sniper ever could hope to — by preventing us from going to war in the first place,” he said. “So, Fox News and the other lazy media — quit making s**t up about me! You look ridiculous.”

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“It’s as though we are continually caught by surprise that others have not chosen to ignore their humiliation, pain, anger and sorrow just because we have.”

American Sniper Illustrates The West’s Morality Blind Spots (Guardian)

Say what you like about the film American Sniper, and people have, you have to admire its clarity. It’s about killing. There is no moral arc; no anguish about whether the killing is necessary or whether those who are killed are guilty of anything. “I’m prepared to meet my maker and answer for every shot I took,” says Bradley Cooper, who plays the late Chris Kyle, a navy Seal who was reputedly the deadliest sniper in American history. There is certainly no discursive quandary about whether the Iraq war, in which the killing takes place, is either legal or justified. “I couldn’t give a flying fuck about the Iraqis,” wrote Kyle in his memoir, where he refers to the local people as “savages”. The film celebrates a man who has a talent for shooting people dead when they are not looking and who, apparently, likes his job.

“After the first kill, the others come easy,” writes Kyle. “I don’t have to psych myself up, or do anything special mentally. I look through the scope, get my target in the crosshairs, and kill my enemy before he kills one of my people.” Americans are celebrating the film. It has been nominated for six Oscars and enjoyed the highest January debut ever. When Kyle kills his rival, a Syrian sniper named Mustafa, with a mile-long shot, audiences cheer. It has done particularly well with men and in southern and midwestern markets where the film industry does not expect to win big. And while its appeal is strong in the heartland it has travelled well too, providing career-best opening weekends for Clint Eastwood in the UK, Taiwan, New Zealand, Peru and Italy. And so it is that within a few weeks of the developed world uniting to defend western culture and Enlightenment values, it produces a popular celluloid hero who is tasked not with satirising Islam, but killing Muslims.

Threats to Arab and Muslim Americans have tripled since the film came out, according to the American-Arab Anti-Discrimination Committee. It’s not difficult to see why. “If you see anyone from about 16 to 65 and they’re male, shoot ’em,” wrote Kyle, describing his understanding of the rules of engagement in Iraq. “Kill every male you see. That wasn’t the official language, but that was the idea.” The west does not see itself the way others see it; indeed it often does not see others at all. Solipsistic in its suffering and narcissistic in its impulses, it promotes itself as the upholder of principles it does not keep, and a morality it does not practise. This alone would barely distinguish it from most cultures. What makes the west different is the physical and philosophical force with which it simultaneously makes its case for superiority and contradicts it. It’s as though we are continually caught by surprise that others have not chosen to ignore their humiliation, pain, anger and sorrow just because we have.

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Global crisis or global solution to a problem?

Japan Is Trying To Figure Out How To Get Its People To Have More Sex (Bloomberg)

Mike Huckabee thinks, inspired by the president’s daughters’ love of Beyonce, that America is in the midst of a values crisis. But in Japan, the worry is about a libido crisis. The birthrate is falling fast. By 2060, the population is expected to go down by a third, and, by 2100, if trends continue, by 61 %. In 2011, sales of adult diapers in Japan exceeded those of baby diapers. It’s an urgent national problem: there isn’t enough procreation. To examine Japanese attitudes toward sex, the Japan Family Planning Association interviewed 3,000 subjects, both male and female, about their sex lives. The group found that 49.3 % of participants (48.3 % of men, 50.1 % of women) had not had sex in the past month. 21.3 % of married men said they were too tired after work (versus 17.8 % of women). Of men, 15.7 % answered that they were no longer interested, after having children. 23.8 % of women said sex was “bothersome.”

There are a number of diagnoses for this aversion to the bedroom. Morinaga Takuro, an economic analyst and TV personality, believes this has something to do with attractiveness. He has suggested a “handsome tax”: “If we impose a handsome tax on men who look good to correct the injustice only slightly, then it will become easier for ugly men to find love, and the number of people getting married will increase.” “I want to tell them that human women are also great fun!” Takuro writes a lament for the men in love with “2D female characters from anime and manga.” He expressed, in the Asahi Shimbun, “I want to tell them that human women are also great fun!” Technology, of course, gets blame: virtual worlds, not to mention porn. But many, especially alarmed to see that more than 20 % of men between 25-29 say they have little interest in sex, see the low interest in sex as part of economic depression.

A Japanese columnist named Maki Fukasawa observes an increase in a group of men he’s dubbed “herbivores”: heterosexual guys who, in contrast to “carnivorous” businessmen, live without expression of sexuality. Angelika Koch, a Cambridge University scholar, author of Manga Girl Seeks Herbivore Boy, sees “a subversion of the traditional male role of the Japanese ‘salaryman’: the corporate male in suit and tie who dedicates his life to his company as breadwinner for his family, the sexually assertive man who spends his evenings drinking with colleagues at hostess clubs and bars.” Whatever the case, it’s an urgent government concern. In 2014, aware of the dangers of becoming a nation of old folks, Prime Minister Shinzo Abe set aside 3 billion yen ($30 million) for programs aimed at boosting the birthrate, including matchmaking programs.

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Even with my extensive Montréal experience, 3 feet in 24 hours is a lot.

US East Coast Braces For ‘Biggest Snowstorm In History’ (Reuters)

A swath of the U.S. East Coast from Philadelphia to New York City to Maine braced for a potentially historic blizzard on Monday expected to dump as much as 3 feet (90 cm) of snow and snarl transportation for tens of millions of people. The National Weather Service (NWS) on Sunday issued a blizzard warning for the northern section of the East Coast from Monday afternoon until Tuesday, placing states from New Jersey to Indiana under winter storm watches and advisories. Airlines canceled hundreds of flights ahead of the storm. “This could be the biggest snowstorm in the history of this city,” New York Mayor Bill de Blasio told a news conference, saying the snowfall could reach up to 3 feet. De Blasio told residents of America’s financial capital and most populous city to stay off the roads and to “prepare for something worse than we have seen before.”

The biggest snowfall on record in New York City came during the storm of Feb. 11-12, 2006, dropping 26.9 inches (68 cm). The NWS called the approaching system a “crippling and potentially historic blizzard,” with many areas along the East Coast expected to be blanketed by 12 inches to 24 inches (30-60 cm) of snow. The New York City area could be the hardest hit, with lashing winds and snowfall of 30 inches (76 cm) or more in some suburbs. Delta Air Lines said on Sunday it was canceling 600 flights because of the blizzard warning for the East Coast, while United Airlines will cancel all Tuesday flights at airports in New York, Boston and Philadelphia. The carrier will limit operations beginning on Monday night at Newark, LaGuardia and John F. Kennedy airports in the New York area. Southwest Airlines said Sunday evening it would cancel more than 130 of 3,410 flights scheduled for Monday due to the storm, an increase from its earlier plan to cancel about 20 flights.

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