Aug 152019
 


Henri Matisse The terrace, St. Tropez 1904

 

US Yield Curve Inversion Highlights Recession Fears, Fed Dilemma (R.)
China: Paper Tiger (Jim Rickards)
Trade Wars and the Over-Valued Dollar (Hill)
Trump Ties China Trade Deal To ‘Humane’ Hong Kong Resolution (R.)
Autopsy Finds Jeffrey Epstein Had Several Broken Neck Bones (NYPost)
Jeffrey Epstein’s Body Claimed By Unidentified ‘Associate’ (NBC)
CEO Scott Borgerson Denies He’s Dating Epstein Pal Ghislaine Maxwell (NYPost)
UK Labour Vows To Bring Down PM Johnson And Delay Brexit (R.)
No Chance Of US-UK Deal If Northern Ireland Peace At Risk – Pelosi (G.)
Half of UK Farms Could Fail After No-Deal Brexit – Report (G.)
Gibraltar To Release Iranian Oil Tanker On Thursday (R.)
Scientists Find Micro Plastics Deep in Arctic Ice (R.)

 

 

It takes on average 18 months from a US yield-curve inversion to a recession.

US Yield Curve Inversion Highlights Recession Fears, Fed Dilemma (R.)

When the U.S. Federal Reserve cut interest rates last month for the first time in more than a decade, it signaled that further reductions in borrowing costs might not be needed. Bond markets vehemently disagree. Sliding bond yields and the inversion of a key part of the U.S. yield curve on Wednesday for the first time in 12 years show that bond investors have a far gloomier outlook for the U.S. and global economies than the U.S. central bank. “The rates market rarely lies and globally it looks like it’s expecting a day of reckoning,” said Tom di Galoma, a managing director at Seaport Global Holdings in New York.

Fears are also rising the Fed may not only be behind the curve in cutting rates, but that central banks may be running out of ammunition to stimulate growth as countries offset each other’s attempts to boost growth with looser fiscal policy. Worsening economic data, weak inflationary pressures, the escalating U.S.-China trade war and intensifying tensions between protesters in Hong Kong and the Chinese government have boosted demand for safe-haven debt, sending many European government bond yields deeper into negative territory while the longest-dated U.S. Treasury yields have fallen to record lows. The inversion of key parts of the Treasury yield curve, in which investors in short-term holdings get paid more than those in long-term ones, has historically been a reliable indicator of a coming recession.

On Wednesday, the yield on the U.S. 10-year Treasury note tipped 2.1 basis points below 2-year Treasury yields, the first time this spread has been negative since 2007, according to Refinitiv data. The inversion rattled investors already worried that a U.S.-China trade war might trigger a global recession and kill off a decade-long bull market on Wall Street. Major U.S. stock indexes were down about 2%.

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“The new “Cold War” is here. Get used to it.”

China: Paper Tiger (Jim Rickards)

[..] at $11,000 per capita GDP, China is stuck squarely in the “middle income trap” as defined by development economists. The path from low income (about $5,000 per capita) to middle-income (about $10,000 per capita) is fairly straightforward and mostly involves reduced corruption, direct foreign investment and migration from the countryside to cities to purse assembly-style jobs. The path from middle-income to high-income (about $20,000 per capita) is much more difficult and involves creation and deployment of high-technology and manufacture of high-value-added goods. Among developing economies (excluding oil producers), only Taiwan, Hong Kong, Singapore and South Korea have successfully made this transition since World War II.


All other developing economies in Latin America, Africa, South Asia and the Middle East including giants such as Brazil and Turkey remain stuck in the middle-income ranks. China remains reliant on assembly-style jobs and has shown no promise of breaking into the high-income ranks. In short, and despite enormous annual growth in the past twenty years, China remains fundamentally a poor country with limited ability to improve the well-being of its citizens much beyond what has already been achieved. [..] Trade wars with the U.S. are escalating, not diminishing as I warned from the start in early 2018.

Trump’s recent imposition of 10% tariffs on the remaining $300 billion of Chinese imports not currently tariffed (in addition to existing tariffs on $200 billion of Chinese imports) will slow the Chinese economy even further. China retaliated with a shock devaluation of the yuan below 7.00 to one dollar, a level that had previously been defended by the People’s Bank of China. Resorting to a currency war weapon to fight a trade war shows just how badly China is losing the trade war. But, this currency war counterattack will not be successful because it will incite more capital outflows from China.


The Chinese lost $1 trillion of hard currency reserves during the last round of capital flight (2014-2016) and will lose more now, despite tighter capital controls. The spike of bitcoin to $11,000 following the China devaluation is a symptom of Chinese people using bitcoin to avoid capital controls and get their money out of China. [..] lurking behind all of this is the coming debt crisis in China. About 25% of China’s reported growth the past ten years has come from wasted infrastructure investment (think “ghost cities”) funded with unpayable debt. China’s economy is a Ponzi scheme like the Madoff Plan and that debt pyramid is set to collapse.

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From last week, but a good reminder that different rules apply to the reserve currency.

Trade Wars and the Over-Valued Dollar (Hill)

President Trump and China are at it again—and both just upped the ante. Currency manipulation and an overvalued U.S. dollar have taken center stage in the news, thanks to Beijing devaluing its currency [last] Monday. Trump’s Treasury Department has countered by naming China a “currency manipulator.” But boiling the problem down to currency manipulation means the administration is fighting a previous war. And that highlights why the president lacks the strategic vision needed to keep up with newer global challenges. America’s trade problems have grown far more broad in recent years. Chronic global trade imbalances threaten the stability of the world economy. And that holds true whether these disruptions are caused by currency manipulation, trade barriers or global capital flows.

Designating China as a “currency manipulator” is long overdue. But it’s hardly a cure-all. It merely initiates consultations with the IMF. And it doesn’t necessarily provide leverage to solve core trade issues. What’s needed is an approach that addresses the fundamental causes of current trade imbalances. The problem does start with China, however, since Beijing just weakened its currency, the yuan, to its lowest level since 2008. This will likely neutralize the impact of new tariffs that the president announced in a tweet last week. China allowed its currency to fall by 2 percent in a mere 24 hours. That’s a significant drop, following an overall 11.4 percent decline since March of 2018.

Weakening the value of the yuan lowers the cost of Chinese goods in the U.S. market. And so, even though the president is attempting to raise the cost of imports through his new tariffs, their sticker price could still shrink. In the wider picture, Trump’s condo-selling mindset – in which he simply imposes more tariffs until Beijing agrees to a “deal” – is a poor means to address global trade imbalances. It’s not China’s intransigence that is overwhelming U.S. manufacturers; it’s an overvalued U.S dollar. There’s no doubt that China has long used predatory trade practices, such as dumping and illegal subsidies, to undercut U.S. manufacturers.

And Beijing has repeatedly intervened in currency markets to suppress the value of its currency—all to continue its job-killing trade surpluses with the United States. But China isn’t the only country that has played the currency game. Over the past two decades, Japan, South Korea and nearly 20 other countries in Asia and Europe have also bid up the price of the U.S. dollar to subsidize their own exports. And that has made U.S. goods increasingly uncompetitive in global markets—with the United States shedding five million manufacturing jobs and nearly 90,000 domestic factories in that time.

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Can the US sit still in case China invades Hong Kong? And what would such an invasion mean for the city’s status as a trade hub?

Trump Ties China Trade Deal To ‘Humane’ Hong Kong Resolution (R.)

President Donald Trump on Wednesday tied a U.S. trade deal with China to humane resolution of the weeks of protests wracking Hong Kong, hours after the State Department said it was “deeply concerned” about reports of movement of Chinese paramilitary forces along the Hong Kong border. The State Department warned that continued erosion of the territory’s autonomy put at risk the preferential status it enjoys under U.S. law. Trump, in his remarks on Twitter, appeared to suggest a personal meeting with Chinese President Xi Jinping to help resolve the crisis. “Of course China wants to make a deal. Let them work humanely with Hong Kong first!” Trump said on Twitter. “I have ZERO doubt that if President Xi wants to quickly and humanely solve the Hong Kong problem, he can do it. Personal meeting?”


Trump, who has been seeking a major deal to correct trade imbalances with China ahead of his 2020 reelection bid, has faced mounting criticism from Congress and elsewhere for not taking a stronger public line on Hong Kong and for his characterization of the protests earlier this month as “riots” that were a matter for China to deal with. In his tweets on Wednesday, Trump also said that his delay in 10% tariffs on more than $150 billion in Chinese imports to Dec. 15 from Sept. 1 “will be reciprocated” by China and the “much good will come from the short deferral to December.” His comment appeared to contradict senior officials in his administration, who said earlier that no concessions were made by Beijing in response to the delay announced on Tuesday.

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“..more common in strangulation murders than suicidal hangings..”

Autopsy Finds Jeffrey Epstein Had Several Broken Neck Bones (NYPost)

Jeffrey Epstein’s autopsy determined the convicted pedophile suffered multiple broken neck bones, according to a report. One of Epstein’s breaks was to the hyoid bone, an injury that experts told the Washington Post is more common in homicide victims. The discoveries were disclosed to the paper by two people familiar with the findings of the autopsy, which was completed on Sunday, but warranted more information by the Medical Examiner’s Office before they make a final cause of death ruling. “Today, a medical examiner performed the autopsy of Jeffrey Epstein,” said Chief Medical Examiner Dr. Barbara Sampson in a statement Sunday night.

“The ME’s determination is pending further information at this time. At the request of those representing the decedent, and with the awareness of the federal prosecutor, I allowed a private pathologist (Dr. Michael Baden) to observe the autopsy examination. This is routine practice.” Epstein was found dead of an apparent suicide in his cell at the Manhattan Correctional Center early Saturday. He was being held there without bail since his July arrest on sex trafficking charges. The Washington Post spoke to Jonathan Arden, president of the National Association of Medical Examiners, who said a broken hyoid bone — which is near the Adam’s apple — is more common in strangulation murders than suicidal hangings.

“If, hypothetically, the hyoid bone is broken, that would generally raise questions about strangulation, but it is not definitive and does not exclude suicidal hanging,” said Arden, who is not involved with the Epstein autopsy. Numerous studies were also cited by the paper that found hyoid bone breaks were found in the minority of suicidal hangings. One such study conducted from 2010 to 2013 that looked at suicidal hangings in India found that hyoid damage was present in just 16 of 264 cases.

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Bill Barr better get a grip on this. It’s turning into an absurdity.

Jeffrey Epstein’s Body Claimed By Unidentified ‘Associate’ (NBC)

Jeffrey Epstein’s body has been claimed from the New York City medical examiner’s office, a source close to the investigation told NBC News on Wednesday. Epstein, 66, was found dead by apparent suicide Saturday morning in his cell at the Metropolitan Correctional Center in Manhattan. The center’s warden has been temporarily reassigned, and the two guards assigned to watch Epstein have been placed on leave. Epstein wasn’t on suicide watch at the time of his death, multiple people familiar with the investigation have told NBC News. Attorney General William Barr has said that he was “appalled” by the development and that he has consulted with the Justice Department’s inspector general, who is also investigating. The person who claimed Epstein’s body was described only as an “Epstein associate.”

After Epstein was arrested last month on charges of sex trafficking of minors and conspiracy to engage in sex trafficking of minors, his attorneys asked U.S. District Judge Richard Berman to allow Epstein to post bond secured by a mortgage on his home in Manhattan. According to court documents, they said the bond would have been co-secured by his brother, Mark Epstein, and a friend identified as David Mitchell. Berman denied bond on July 18. About a week later, Epstein was found injured and in a fetal position in his cell, raising questions at the time of whether he had tried to kill himself. On Monday, Berman complained in a letter to the warden, Lamine N’Diaye, that the federal Bureau of Prisons still hasn’t explained what he called the July “incident.”

In a response later Monday, N’Diaye said that an internal investigation was completed on July 23 but that she couldn’t reveal any information because of the investigations into Epstein’s death on Saturday. On Tuesday, Justice Department officials confirmed that N’Diaye had been reassigned.


Painting said to be hanging in Epstein townhouse

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“..a property manager of an adjacent parcel of land said that Maxwell was living at Borgerson’s residence as recently as two weeks ago…”

CEO Scott Borgerson Denies He’s Dating Epstein Pal Ghislaine Maxwell (NYPost)

The man rumored to be dating Jeffrey Epstein’s former lover and alleged madam Ghislaine Maxwell has completely denied any romance between the pair. Maxwell has been reportedly living with tech CEO Scott Borgerson at his Manchester, Massachusetts home, according to the Daily Mail. But Borgerson called The Post Wednesday to insist he had been busy working abroad – and nobody has been at his home. He arrived back in the US late Wednesday, only to be met by a police escort, and said: “It’s pretty crazy, all of this just exploded. People keep asking me, but I am not dating Ghislaine, I’m home alone with my cat.” When asked about the status of his friendship with Maxwell now, Borgerson replied: “I don’t want to comment on that – would you want to talk about your friends?”


“I landed after a long flight and my phone went crazy, the first thing I did was call the local police to check my house.” Asked if he knew where Maxwell now is, Borgerson, a divorced dad, replied: “She’s not here, I have no idea where she is. “Nobody wants to be close to this radioactive situation.[..] The Post has been told that friends of Maxwell last saw her over the past month walking down a London street, but she has gone to ground. Borgerson refused to say whether Maxwell had ever stayed at his home. Despite this, NBC News reported on Wednesday that a property manager of an adjacent parcel of land said that Maxwell was living at Borgerson’s residence as recently as two weeks ago.

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Corbyn wants to be PM. But not a lot of MPs like him.

UK Labour Vows To Bring Down PM Johnson And Delay Brexit (R.)

The Labour Party has urged rebel MPs in the ruling Conservatives to help block a no-deal Brexit by bringing down Prime Minister Boris Johnson’s administration and allowing its leader Jeremy Corbyn to form a caretaker government. Johnson has promised to take Britain out of the European Union by Oct. 31, with or without a deal, setting the scene for a showdown in parliament where MPs are opposed to a divorce without a transition agreement. In a letter to opposition party leaders and several senior Conservatives opposed to a disorderly exit, Corbyn said his “strictly time-limited temporary government” would delay Brexit and hold a general election.


He said Labour would campaign in the election to hold a second referendum on the Brexit terms, including an option as to whether the country should remain in the bloc three years after it voted to leave. “This government has no mandate for No Deal, and the 2016 EU referendum provided no mandate for No Deal,” Corbyn said. “I therefore intend to table a vote of no confidence at the earliest opportunity when we can be confident of success.” A spokeswoman for Johnson’s Downing Street office said the choice was clear: “This government believes the people are the masters and votes should be respected, Jeremy Corbyn believes that the people are the servants and politicians can cancel public votes they don’t like.”

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Why is it Bolton who’s talking trade deals?

No Chance Of US-UK Deal If Northern Ireland Peace At Risk – Pelosi (G.)

There is no chance of Congress approving a US-UK trade agreement if Brexit undermines the Good Friday peace agreement in Northern Ireland, the speaker of the House of Representatives, Nancy Pelosi, has said. Pelosi was restating the entrenched position of congressional Democrats and many Republicans in the wake of remarks made by Donald Trump’s national security adviser, John Bolton, during a visit to London this week. Bolton had said that Britain and the US could sign interim, partial free trade deals, one sector at a time, which would go through the a fast track legislative process, to help the UK cope economically if there is a no-deal Brexit on 31 October.

In a statement on Wednesday, the House speaker, who commands a Democratic majority, warned that the Trump administration would not be able to sidestep congressional approval. “Whatever form it takes, Brexit cannot be allowed to imperil the Good Friday agreement, including the seamless border between the Irish Republic and Northern Ireland, especially now, as the first generation born into the hope of Good Friday 21 years ago comes into adulthood.” Pelosi said. “We cannot go back.” Bolton said the sectoral deals, focusing on industries such as car manufacturing, could be negotiated quickly, and insisted they would receive overwhelming bipartisan support in Congress.

“The ultimate end result is a comprehensive trade agreement covering all trading goods and services,” he said after meeting Boris Johnson and senior British officials on Monday. “But to get to that you could do it sector by sector, and you can do it in a modular fashion. In other words, you can carve out some areas where it might be possible to reach a bilateral agreement very quickly, very straightforwardly.”

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Most heavily subsidized.

Half of UK Farms Could Fail After No-Deal Brexit – Report (G.)

Campaigners for a second referendum are herding a flock of sheep down Whitehall to protest against the impact a no-deal Brexit could have on the farming community. According to a new report commissioned by the supporters of second poll, more than half of UK farms could go out of business if Britain crashes out of the EU on 31 October. Backed by the People’s Vote campaign and written by Dr Séan Rickard, former chief economist of the National Farmers’ Union, the report warns that 50% of farms could go under as the government would prioritise keeping down food prices for consumers ahead of protecting agricultural producers. To coincide with the report and launch of the Farmers for a People’s Vote group, campaigners are taking a small flock of sheep past the Cabinet Office where no-deal planning is taking place.

The report says the EU and all the countries with whom it has free-trade agreements would immediately apply tariffs and non-tariff barriers on food imports from the UK in the event of a no-deal Brexit. At the same time, UK tariffs on imports would be slashed or reduced to nothing. It argues: “The combination of the removal of support payments – only a proportion will be made up by enhanced environmental payments – and an adverse trading environment will render the majority of farm businesses unviable. By the mid-2020s a large proportion of farm businesses – 50% or more is not an unreasonable estimate – recognising that they face an unprofitable future will decide to cease trading.”

[..] In the event of a no deal Brexit, Rickard argued that many industries would suffer but agriculture would feel the most serious economic shock. “It is impossible to project the exact number of farmers who will go out of business”, he said. “What we do know is that over 40% of them will have no net income if the basic payment is removed. If at the same time the government removes all tariffs and so depresses prices, these two factors combined will render over 50% of farms in this country unviable. “The possibility of any compensation from the government going anywhere near offsetting this is remote because so many promises have been made to so many other sectors and not all can be fulfilled.”

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Bolton gone wrong.

Gibraltar To Release Iranian Oil Tanker On Thursday (R.)

The British territory of Gibraltar will on Thursday release an Iranian oil tanker seized by Royal Marines in the Mediterranean in July, the Sun newspaper reported, citing sources close to Gibraltar Chief Minister Fabian Picardo. Picardo would not apply to renew an order to detain Grace 1, the report said, adding that he is now satisfied that the oil tanker is no longer heading to Syria. Britain had said the vessel was violating European sanctions by taking oil to Syria, a charge Iran denies. “There is no reason to keep Grace 1 in Gibraltar a moment longer if we no longer believe it is in breach of sanctions against the Syrian regime,” the newspaper quoted a source close to Picardo as saying.

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Everywhere. Literally. If it’s deep in Arctic ice, it’s deep inside you too.

Scientists Find Micro Plastics Deep In Arctic Ice (R.)

Tiny pieces of plastic have been found in ice cores drilled in the Arctic by a U.S.-led team of scientists, underscoring the threat the growing form of pollution poses to marine life in even the remotest waters on the planet. The researchers used a helicopter to land on ice floes and retrieve the samples during an 18-day icebreaker expedition through the Northwest Passage, the hazardous route linking the Pacific and Atlantic oceans. “We had spent weeks looking out at what looks so much like pristine white sea ice floating out on the ocean,” said Jacob Strock, a graduate student researcher at the University of Rhode Island, who conducted an initial onboard analysis of the cores.


Microplastic found in ice core samples taken from the Northwest Passage. Northwest Passage Project/Camera: Duncan Clark via REUTERS

“When we look at it up close and we see that it’s all very, very visibly contaminated when you look at it with the right tools — it felt a little bit like a punch in the gut,” Strock told Reuters by telephone on Wednesday. Strock and his colleagues found the material trapped in ice taken from Lancaster Sound, an isolated stretch of water in the Canadian Arctic, which they had assumed might be relatively sheltered from drifting plastic pollution. The team drew 18 ice cores of up to 2 meters (6.5 feet) long from four locations and saw visible plastic beads and filaments of various shapes and sizes. “The plastic just jumped out in both its abundance and its scale,” said Brice Loose, an oceanographer at the University of Rhode Island and chief scientist of the expedition, known as the Northwest Passage Project.

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Jul 282019
 
 July 28, 2019  Posted by at 9:25 am Finance Tagged with: , , , , , , , , , , ,  


Pablo Picasso Portrait of Dora Maar 1937

 

UK Top Civil Servant Urged To Block Dominic Cummings Appointment (Ind.)
Johnson’s Key Adviser Dominic Cummings Must Face Sanctions, Demand MPs (G.)
UK To Ramp Up Funding For No-Deal Brexit Preparations (R.)
Ex-Chancellor Hammond Plots With Labour To Kill Johnson’s No-Deal Brexit (G.)
China Retreats Globally (F.)
How Close Is China To A Financial Crisis? (F.)
FAA Let Boeing Sign Its Own Safety Certifications On 737 MAX (ZH)
Tanker Seizures and Resurgent Imperialism (Craig Murray)
Hong Kong Protesters Defy Police Again On Sunday (AFP)
Alaskan Glaciers Melting 100 Times Faster Than Previously Thought (NatGeo)

 

 

The name Cummings dominates the news. In the US there’s Elijah Cummings, attacks on whom by Trump are making the word ‘racist’ popular again in the Dems camp suddenly. In the UK it’s Dominic Cummings, Boris Johnson’s key adviser, who draws the ire of MPs.

As I wrote a few days ago, Boris bringing in Dominic Cummings can only mean elections. Because that’s what he’s good at, and he wouldn’t come in for other reasons. Another aspect is Cummings doesn’t play second fiddle. He’s got the key to no. 10 now. So not only does the UK have its second unelected PM in a row, the PM has handed power to someone in the shadows. To ensure Brexit.

UK Top Civil Servant Urged To Block Dominic Cummings Appointment (Ind.)

The head of the civil service has been urged to block the appointment of Brexit mastermind Dominic Cummings to a senior Downing Street role. Boris Johnson’s decision to invite Mr Cummings to become a key No 10 adviser has sent shockwaves through Westminster, coming only months after he was found in contempt of parliament for refusing to give evidence to the Commons fake news inquiry. The move also sparked fears among Tory moderates about the new prime minister’s Brexit approach, as Mr Cummings was the architect of Vote Leave’s Take Back Control slogan and the pledge to claw back £350m a week from the EU for the NHS. The Liberal Democrats have written to Sir Mark Sedwill, the UK’s most senior mandarin, urging him to intervene as they warned the news should “send shivers down the spines” of the British public.

Layla Moran MP argued the Brexiteer’s conduct fell short of necessary Whitehall standards due to his admonishment for contempt and his involvement in Vote Leave’s “misleading” campaign about NHS funds. She also pointed to the decision by Mr Cummings to leak a confidential Digital, Culture, Media and Sport Committee report, when he reportedly declared “f*** the charlatans embargo” before posting the document on his personal blog. Ms Moran told The Independent: “The appointment of Dominic Cummings should send shivers down the spines of UK citizens. This is a man who has peddled lies and flouted the truth for sheer, cynical political gain. “The dark arts that he proffers should have no place in government, and no place in Downing Street.

[..] Mr Cummings is respected among Brexiteers as being instrumental to the success of the 2016 referendum campaign, but his vocal criticism of MPs and civil servants has ruffled feathers. Since the referendum, Mr Cummings has described Brexit as a “train wreck”, and said triggering Article 50 too early was like “putting a gun in your mouth and pulling the trigger”. He also branded David Davis, the former Brexit secretary, “thick as mince and lazy as a toad”, and described the Tory European Research Group as “useful idiots for Remain”.

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Just as I said a few days ago: “In his new role at Downing Street Cummings appears to be getting Johnson on an election footing..”

Johnson’s Key Adviser Dominic Cummings Must Face Sanctions, Demand MPs (G.)

Prominent MPs on the committee investigating fake news and disinformation want Boris Johnson’s aide Dominic Cummings, who has been found in contempt of parliament, to face sanctions in his new role at the heart of government. These could include docking his salary, denying him a security pass and putting pressure on the prime minister to force him to give evidence to parliament. Johnson’s decision to appoint Cummings as a key adviser outraged many MPs because it came less than four months after parliament unanimously passed a motion, tabled by the government, to censure him for failing to testify at the fake news inquiry. Some also have concerns about his role as mastermind of the Brexit campaign. The official Vote Leave group has been found to have broken electoral law and referred to the police.

“This is someone who campaigned to take back control for parliament, and yet has decided the only person who shouldn’t be accountable to parliament is him,” said MP Sarah Wollaston, who has left the Tory party and sits as an independent. “What does that say about the prime minister’s attitude to parliament? It’s a terrible error of judgment.” Wollaston admitted there was no mechanism to enforce motions holding individuals in contempt of parliament. But members of the committee that originally summoned Cummings to give evidence say they want to recall him again, and have suggested a range of sanctions. “We need to demand that he attends to give evidence and call on Boris Johnson [to ensure] that he does attend. We would expect the prime minister to fully support our call for evidence,” said Jo Stevens, one of the MPs on the committee.

She also suggested any decision to give him a security pass should be closely scrutinised. “Everyone who works in parliament has to go through a very stringent security procedure. How can someone who oversaw a campaign that is the subject of a serious criminal investigation pass that test? He will have access not just to parliament but to the inner sanctum of No 10. There are obvious and serious security implications to that.” [..] In his new role at Downing Street Cummings appears to be getting Johnson on an election footing; the Conservative party Facebook page has fielded hundreds of ads since his appointment. Although they are spending relatively small amounts, the range of ads allow them to test voters’ responses and gather data on those who do interact with the advertisements.

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Don’t think one billion will do much. Especially if it’s spent on PR campaigns.

UK To Ramp Up Funding For No-Deal Brexit Preparations (R.)

New British finance minister Sajid Javid plans to announce spending of around 1 billion pounds to make sure the country is properly prepared for a possible no-deal Brexit in October, a newspaper reported. Javid told the Sunday Telegraph he would overhaul the British Treasury’s approach to Brexit, starting with “significant extra funding” announcements in the coming days to get Britain fully ready to leave the European Union on Oct. 31, with or without a deal. The extra spending would include financing a major public information campaign for individuals and businesses.


The Sunday Telegraph also quoted Javid as saying he had plans for 500 new Border Force officers and possible new infrastructure around the country’s ports. Javid’s predecessor Philip Hammond, who opposed leaving the EU without a transition deal, was accused by Brexit supporters of failing to spend enough money to get Britain ready for a no-deal Brexit, undermining its negotiating position with Brussels.

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BIG fight coming up.

Ex-Chancellor Hammond Plots With Labour To Kill Johnson’s No-Deal Brexit (G.)

The former Tory chancellor Philip Hammond held private talks with Labour’s Brexit spokesman Keir Starmer shortly before Boris Johnson entered Downing Street last Wednesday, to plot cross-party moves aimed at preventing the new prime minister agreeing to a no-deal Brexit. The meeting in the House of Commons – which took place shortly after Hammond had resigned from the government – is evidence of the fierce backlash Johnson faces from MPs of all parties if he tries to defy parliament and take the UK out of the EU without an agreement on 31 October.

It is understood that the former political opponents Hammond and Starmer agreed to work together through the summer recess with other leading parliamentarians who oppose no deal, including former Tory ministers Oliver Letwin and Dominic Grieve, to thrash out how best to use parliamentary votes to torpedo no deal. On Saturday night Starmer confirmed that Johnson’s arrival in No 10 had spurred more cross-party discussions at high levels involving senior Tories sacked by Johnson, or who chose to resign, as opponents of no deal prepared a cross-party counter-offensive against his new hard-Brexit cabinet and government.

“The political direction of travel under Boris Johnson is clear,” said Starmer, “and so it is more important than ever that we build a strong cross-party alliance to stop a no-deal Brexit. “That work will intensify over the summer, before parliament resumes in September.” The plans being hatched include amending Brexit-related legislation that has to pass through parliament before the UK can leave the EU in a way that would force the Johnson to ask for a further extension to the UK’s membership if no Brexit agreement has been reached by early October. A “last resort” option is for Hammond and other Tory Remainers to vote for a no-confidence motion in their own government if no deal still appears on the cards.

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Written a lot about this. China doesn’t have the foreign reserves to let its people spend freely across the world. That was true even before the trade war. When are the Chinese tourists going to disappear from western streets?

China Retreats Globally (F.)

China has retreated globally – not from its artificial islands in the South China Sea but economically and financially. It seems just yesterday that the Middle Kingdom, as China calls itself, resembled an unstoppable juggernaut, cutting constructions contracts and buying properties all over the world. That is no longer the case. Trade war with the United States bears much of the blame (or gets the credit, depending on one’s perspective), but even if Washington and Beijing were to sign a deal tomorrow, China would not regain its old momentum. Official Ministry of Finance (MOF) figures, not surprisingly, offer a soothing picture of moderate decline, but private sources tell a much more dramatic story.

According to the American Enterprise Institute’s well-regarded China Global Investment Tracker (CGIT), Chinese overseas investments of all kinds in the first half of this year averaged only $27.5 billion, half the rate averaged during the same time in 2018 and barely a quarter the rate of 2017’s first half. This year’s figures are lower than any time since 2008. Construction contracts, largely in the third world as part of China’s Belt and Road initiative, have fallen off, too, but less dramatically. China clearly has become much less engaged with the world than it was. Two things have caused this retreat. One is a growing hostility among host countries toward Chinese investment. Especially developed countries, the US in particular, have balked over the Chinese practice of extracting technology.

Suspicions along these lines have held up approvals for Chinese purchases and other direct flows of funds. Some familiar with Chinese practice have gone a step further. The European Chamber of Commerce has warned against developing a dependence on China and Chinese funds. This combination of concerns and suspicions have centered primarily on China’s huge state owned enterprises and less on private Chinese investment. But if private investment has fallen off less dramatically, this growing reluctance in the West has had its effect there, too. More significant is China’s relative shortage of hard currency. Despite Beijing’s efforts to make the yuan a global currency, it is little used in currency transactions – no more than 2% of the total in fact – and so is of little use in overseas purchases.

Meanwhile the trade war with the United States has already begun to cut into Beijing’s supplies of foreign exchange. Beijing actually anticipated the problem and in 2017 and began to ration foreign exchange even before the White House added any tariffs. The first major investment declines occurred in late 2018, when the While House first imposed 10% tariffs on a range of Chinese products. The next drop coincided with this past spring’s increased tensions. To be sure, Beijing’s foreign exchange hoard remains huge, but officials are wary of how rapidly it has shrunk, falling some 25% from almost $4 trillion at its peak in 2014 to barely over $3 trillion during the first half of this year. Beijing’s rationing of these financial resources has affected the state-owned sector in particular. Private companies have a greater willingness and ability to borrow hard currencies abroad.

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Dangerously close.

How Close Is China To A Financial Crisis? (F.)

China haters have been waiting for a financial crisis out of China since at least the early 2000s. Each and every time, the People’s Bank of China’s plunge protection team or the central planners in Beijing would throw buckets of ice water on their heads. This time might be different. This time they are dealing with a trade war. Most investment banks have some proprietary model that gives their fund managers a gauge on crises. For Nomura Securities, no country is flashing red more than China. “China has the second-highest number of flashing early warning indicators after Hong Kong,” says Rob Subbaraman, an Asia economist for Nomura in Singapore.

Months of protests against an stalled prisoner extradition bill with China have turned into protests against the Hong Kong government, with the very real possibility of the U.S. doing away with its special trade relationship with Hong Kong. If that ever happened, the Hong Kong dollar would no longer be a de facto source of U.S. dollars for mainland China, assuming Washington included Hong Kong in its mainland China tariff regime. Chinese policymakers need to guard against a renewed build-up of financial stability risks, Subbaraman says. Out of 60 early warning indicators flashing on Nomura’s Cassandra risk assessment program, Hong Kong has 49 covered. China has 25. The U.S. has precisely zero.

Cassandra has reliably signaled around two thirds of the past 50 financial crises in a sample of 30 emerging market and advanced countries, including the U.S., since the early 1990s, Nomura says. Casandra looks at five early warning indicators, including debt-service ratio gap (DSR) with a particular country’s historic average; joint credit and real property price gaps with the average; joint credit and real effective exchange rate (REER) gaps; joint DSR and REER gaps; and finally, a combination of all three credit indicators above. The predefined thresholds of pain-points for a country are set in a way that the early warning indicators flash when one of those thresholds is breached. That means a crisis is likely to hit within three years.

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No surprise there. But that model is over.

FAA Let Boeing Sign Its Own Safety Certifications On 737 MAX (ZH)

Thanks to a ‘broken regulatory process,’ the Federal Aviation Administration has been passing off routine oversight tasks to manufacturers for years. In the case of the beleagured 737 Max, however, the plane was so advanced that the regulator “handed nearly complete control to Boeing,” which was able to sign off on its own safety certificates, according to the New York Times. The lack of regulatory oversight meant that the FAA had no clue how Boeing’s automated anti-stall system, known as MCAS, worked. In fact, “regulators had never independently assessed the risks of the dangerous software” when they issued a 2017 approval for the plane.

“The company performed its own assessments of the system, which were not stress-tested by the regulator. Turnover at the agency left two relatively inexperienced engineers overseeing Boeing’s early work on the system. The F.A.A. eventually handed over responsibility for approval of MCAS to the manufacturer. After that, Boeing didn’t have to share the details of the system with the two agency engineers. They weren’t aware of its intricacies, according to two people with knowledge of the matter.” -New York Times.

During the late stages of the Max’s development, Boeing engineers decided to increase the plane’s reliance on MCAS to fly smoothly. Unfortunately, a new version of the system relied on a single sensor which could malfunction and push the plane into a nosedive. Boeing never submitted a formal assessment of the MCAS system following its upgrade – which wasn’t required by FAA rules. An agency official claims that an engineering test pilot was familiar with the changes, however his job was to evaluate its effect on how the plane flew – not on its safety. The jet was eventually certified as safe to fly, and the FAA required very little pilot training until the second Max crashed less than five months after the first.

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There are very clear laws that forbid seizure of tankers. Give them all back.

Tanker Seizures and Resurgent Imperialism (Craig Murray)

[The] UN Convention which is one of the base blocks of international law [..] does not state that the right to transit through straits can be subject to any sanctions regime which the coastal state chooses to impose; indeed it is clearly worded to preclude such coastal state activity. Nor can it be overridden by any regional grouping of which the coastal state is a member. Jeremy Hunt’s statement to parliament that the Iranian tanker had “freely navigated into UK territorial waters” was irrelevant in law and he must have known that. The whole point of passage through straits is that it is by definition through territorial waters, but the coastal state is not permitted to interfere with navigation.

It is therefore irrelevant whether, as claimed by the government of the UK and their puppets in Gibraltar, the tanker was intending to breach EU sanctions by delivering oil to Syria. There is a very strong argument that the EU sanctions are being wilfully misinterpreted by the UK, but ultimately that makes no difference. Even if the EU does have sanctions seeking to preclude an Iranian ship from delivering Venezuelan oil to Syria, the EU or its member states have absolutely no right to impede the passage of an Iranian ship through the Strait of Gibraltar in enforcement of those sanctions. Anymore than Iran could declare sanctions against Saudi oil being delivered to Europe and close the Straits of Hormuz to such shipping, or Indonesia could declare sanctions on EU goods going to Australia and close the Malacca Strait, or Russia could declare sanctions on goods going to Ukraine and close the Strait of Kerch.

[..] I was for three years the Head of the Maritime Section of the Foreign and Commonwealth Office. I was Alternate Head of the UK Delegation to the UN Preparatory Commission on the UN Convention on the Law of the Sea. I both negotiated, and drafted parts of, the Protocol that enabled the Convention to come into force. I was the Head of the FCO Section of the Embargo Surveillance Centre and responsible for giving real time political and legal clearance, 24 hours a day, for naval boarding operations in the Gulf to enforce a UN mandated embargo. There are very few people alive who combine both my practical experience and theoretical knowledge of precisely the subject here discussed.

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“..leaving pools of blood in the same concourse where the suspected triads had attacked the previous weekend.”

Hong Kong Protesters Defy Police Again On Sunday (AFP)

Thousands of pro-democracy protesters defied a police ban and began marching through Hong Kong on Sunday, a day after riot police fired rubber bullets and tear gas in the latest violent confrontation to plunge the financial hub deeper into crisis. Huge crowds gathered in the heart of the city’s commercial district on Sunday afternoon, after police gave permission for a static protest in a park but banned a proposed march through the city. Yet protesters soon spilled into the streets outside the park and began marching in spite of the ban, ratcheting up the likelihood of renewed clashes. “I feel so conflicted, seeing young people sacrifice their future for Hong Kong,” a 22-year-old student protester called Marcus told AFP, breaking into tears.


The latest march comes a day after a town near the border with mainland China descended into chaos, as police battled protesters holding another banned rally against suspected pro-government triad gangs who beat up democracy demonstrators there last weekend. Riot police used tear gas throughout the afternoon and evening in Yuen Long after tense standoffs with protesters, some of whom were throwing projectiles and had surrounded a police van. Rubber bullets were fired later in the clashes which ended when officers baton-charged the last remaining demonstrators inside the town’s metro station, leaving pools of blood in the same concourse where the suspected triads had attacked the previous weekend.

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There’s a pattern.

Alaskan Glaciers Melting 100 Times Faster Than Previously Thought (NatGeo)

A new way of measuring how some glaciers melt below the surface of the water has uncovered a surprising realization: Some glaciers are melting a hundred times faster than scientists thought they were. In a new study published today in Science, a team of oceanographers and glaciologists unpeeled a new layer of understanding of tidewater glaciers—glaciers that end in the ocean—and their dynamic processes. “They’ve really discovered that the melt that’s happening is fairly dramatically different from some of the assumptions we’ve had,” says Twila Moon, a glaciologist at the National Snow and Ice Data Center at the University of Colorado-Boulder who was uninvolved with the study. Some of this calving and glacial melt is a normal process that glaciers undergo during seasonal transitions from winter to summer, and even through the summer.


But a warming climate accelerates glacier melting across the globe, potentially through melting across the surface of the glacier, but also through underwater melting. Glaciers can extend hundreds of feet below the surface, explained Ellyn Enderlin, a glaciologist at Boise State University who was not involved with the study. Finding higher rates of submarine melting tells us that “glaciers are a lot more sensitive to ocean change than we’ve even thought.” Understanding the melting processes and calculating the amount of melt accurately is essential for planning for sea level rise. “We are just super jazzed that we can even do this,” says lead author David Sutherland, an oceanographer at the University of Oregon. “We weren’t 100 percent sure it was going to work.”

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The Saffron Goddess (1600 B.C.) is a detail from a Minoan fresco depicting a saffron harvest, Akrotiri, Santorini island, Greece.

 

 

 

 

Jul 232019
 
 July 23, 2019  Posted by at 9:48 am Finance Tagged with: , , , , , , , , , , , ,  


Odilon Redon Sunset n.d.

 

US Justice Department Tells Mueller To Limit Congressional Testimony (R.)
What Goes Around (Kunstler)
A Non-Hack That Raised Hillary’s Hackles (Ray McGovern)/span>
Inequality is Destroying Democratic Capitalism (Deaton)
Who Was Jeffrey Epstein Calling? (NYMag)
Chelsea Clinton Denies Ties To Jeffrey Epstein’s Alleged ‘Madam’ (MN)
UK’s May Takes Parting Shot at Putin in Desperate Diversion From Failure (SCF)
Iran Warns West Against Starting Conflict (R.)
France To Shut Down Nuclear Plants Due To Heatwave (Montel)
Huge Swathes Of The Arctic On Fire, Satellite Images Show (Ind.)

 

 

He might as well stay home. Can’t talk about Concord, can’t talk about anything not in the report.

US Justice Department Tells Mueller To Limit Congressional Testimony (R.)

The U.S. Justice Department told former Special Counsel Robert Mueller on Monday he should limit his testimony before Congress this week to discussing his public report on the Russia probe. In a letter to Mueller, Associate Deputy Attorney General Bradley Weinsheimer said his testimony set for Wednesday “must remain within the boundaries of your public report because matters within the scope of your investigation were covered by executive privilege.” The letter said “these privileges would include discussion about investigative steps or decisions made during your investigation not otherwise described in the public version of your report.”

Mueller completed in March his nearly two-year-long probe into Russian meddling in the 2016 election and possible obstruction of justice by President Donald Trump. The Justice Department released a redacted copy of his 448-page report in April. A spokesman for Mueller, Jim Popkin, said no one at the Justice Department, Congress or the White House would review Mueller’s statement before he delivers it on Wednesday. In back-to-back hearings before the House of Representatives Judiciary and Intelligence committees, Democrats are expected to try to get Mueller to focus his testimony on specific examples of Trump’s misconduct.

[..] Mueller has been using offices at his former law firm WilmerHale and working with a small team from the special counsel’s office to prepare for Wednesday’s hearings, Popkin said. “He will come well prepared,” Popkin said. “His team has been working on this for a while and they will be ready for whatever comes their way.”

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“is it possible that he’s just not very bright?”

What Goes Around (Kunstler)

The entrapment operation that was the Special Counsel’s covert mission has turned out to be Mr. Mueller own personal booby-trap, prompting the question: is it possible that he’s just not very bright? Though Mr. Mueller’s final report asserted that the Russian government interfered in “a sweeping and systemic fashion” to influence the 2016 election, the 450-page great tome contains zero evidence to support that claim, and the discrepancy was actually noticed by federal judge Dabney Friedrich who is presiding over the case against the alleged Russian Facebook trolls that was one of the two tent-poles in the RussiaGate fantasy. The case is now blowing up in Robert Mueller’s face.

In early 2018, Mr. Mueller sold a DC grand jury on producing indictments against a Russian outfit called the Internet Research Agency and its parent company Concord Management, owned by Russian oligarch Yevgeny Prigozhin for the so-called election meddling. The indictment was celebrated as a huge coup at the time by the likes of CNN and The New York Times, styled as a silver bullet in the heart of the Trump presidency. But the indicted parties were all in Russia, and could not be extradited, and there was zero expectation that any actual trial would ever take place — leaving Mueller & Co. off-the-hook for proving their allegations.

To the great surprise of Mr. Mueller and his “team,” Mr. Prigozhin hired some American lawyers to defend his company in court. Smooth move. It automatically triggered the discovery process, by which the accused is entitled to see the evidence that prosecutors hold. It turned out that Mr. Mueller’s team had no evidence that the Russian government was involved with the Facebook pranks. This annoyed Judge Friedrich, who ordered Mr. Mueller and his lawyers to desist making public statements about Concord and IRA’s alleged “sweeping and systemic” collusion with Russia, and threatened legal sanctions if they did.

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Three years ago. That went by fast.

A Non-Hack That Raised Hillary’s Hackles (Ray McGovern)/span>

Three years ago Monday WikiLeaks published a trove of highly embarrassing emails that had been leaked from inside the Democratic National Committee. As has been the case with every leak revealed by WikiLeaks, the emails were authentic. These particular ones, however, could not have come at a worse time for top Democratic Party officials. The emails made it unmistakably clear that the DNC had tipped the scales sharply against Democratic insurgent Bernie Sanders, giving him a snowball’s chance in hell for the nomination. [..] A mere four days after the WikiLeaks release, a well orchestrated Democratic Convention nominated Clinton, while many Sanders supporters loudly objected.

Thus, she began her campaign under a cloud, and as more and more Americans learned of the fraud that oozed through the DNC email correspondence — including the rigging of the Democratic primaries — the cloud grew larger and darker. On June 12, 2016, six weeks before the convention, WikiLeaks publisher Julian Assange had announced in an interview on British TV, “We have upcoming leaks in relation to Hillary Clinton … We have emails pending publication.” Independent forensic investigations demonstrated two years ago that the DNC emails were not hacked over the Internet, but had been copied onto an external storage device — probably a thumb drive. Additional work over recent months has yielded more evidence that the intrusion into the DNC computers was a copy, not a hack, and that it took place on May 23 and 25, 2016.

No one knew how soon WikiLeaks would publish the emails, but the DNC offense/defense would surely have to be put in place before the convention scheduled to begin on July 25. That meant there were, at most, six weeks to react. But it only took two days. As early as July 24, about 48 hours after the leaks were published, and a day before the convention, the DNC first blamed Russia for hacking their emails and giving them to WikiLeaks to sabotage Clinton. Granted, it was a stretch — and the DNC would have to hire a pliable cybersecurity firm to back up their claim. But they had good reason to believe that CrowdStrike would perform that service. It was the best Clinton campaign manager Robbie Mook and associates could apparently come up with.

If they hurried, there would be just enough time to prepare a PR campaign before the convention and, best of all, there was little doubt that the media could be counted on to support the effort full bore. [..] It pretty much worked like a charm. The late Senator John McCain and others were quick to call the Russian “hack” an “an act of war.” Evidence? None. For icing on the cake, then-FBI Director James Comey decided not to seize and inspect the DNC computers. Nor, as we now know, did Comey even require a final report from CrowdStrike.

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Not sure having it discussed by well-paid economists is all that useful.

Inequality is Destroying Democratic Capitalism (Deaton)

At the risk of grandiosity, I think that today’s inequalities are signs that democratic capitalism is under threat, not only in the US, where the storm clouds are darkest, but in much of the rich world, where one or more of politics, economics, and health are changing in worrisome ways. I do not believe that democratic capitalism is beyond repair nor that it should be replaced; I am a great believer in what capitalism has done, not only to the oft-cited billions who have been pulled out of poverty in the last half-century, but to all the rest of us who have also escaped poverty and deprivation over the last two and a half centuries. It also provides our jobs and the cornucopia of goods and services that we take for granted.

And Milton Friedman, whose starry-eyed view of capitalism has much to answer for, was not entirely wrong when he extolled the freedom that free markets can bring. Though history has not been kind to his view that equality would be guaranteed by using markets to pursue freedom. But we need to think about repairs for democratic capitalism, either by fixing what is broken, or by making changes to head off the threats; indeed, I believe that those of us who believe in social democratic capitalism should be leading the charge to make repairs.

As it is, capitalism is not delivering to large fractions of the population; in the US, where the inequalities are clearest, real wages for men without a four-year college degree have fallen for half a century, even at a time when per capita GDP has robustly risen. Mortality rates are rising for the less-educated group at ages 25 through 64, and by enough that life expectancy for the entire population has fallen for three years in a row, the first time such a reversal has happened since the end of the first world war and the great influenza epidemic. Less educated Americans are dying by their own hands, from suicide, from alcoholic liver disease, and from overdoses of drugs. Morbidity is rising too, and they are also suffering from an epidemic of chronic pain that, for many, makes a misery of daily life.

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“If you watch Fox News, you will believe Bill Clinton was Epstein’s No. 1 pal and enabler. If you watch MSNBC, this scandal is usually all about Donald Trump. ”

Who Was Jeffrey Epstein Calling? (NYMag)

Perhaps, at long last, a serial rapist and pedophile may be brought to justice, more than a dozen years after he was first charged with crimes that have brutalized countless girls and women. But what won’t change is this: the cesspool of elites, many of them in New York, who allowed Jeffrey Epstein to flourish with impunity. For decades, important, influential, “serious” people attended Epstein’s dinner parties, rode his private jet, and furthered the fiction that he was some kind of genius hedge-fund billionaire. How do we explain why they looked the other way, or flattered Epstein, even as they must have noticed he was often in the company of a young harem?

Easy: They got something in exchange from him, whether it was a free ride on that airborne “Lolita Express,” some other form of monetary largesse, entrée into the extravagant celebrity soirées he hosted at his townhouse, or, possibly and harrowingly, a pound or two of female flesh. If you watch Fox News, you will believe Bill Clinton was Epstein’s No. 1 pal and enabler. If you watch MSNBC, this scandal is usually all about Donald Trump. In fact, both presidents are guilty (at the very least) of giving Epstein cover and credibility.

There are so many unanswered questions about Epstein, but one that looms over all of them is whether the bipartisan crowd who cleared a path for him will cover its tracks before we can get answers — not just Clinton and Trump and all those who drank at Epstein’s trough but also (among others) institutions like Harvard, Dalton, and the Council on Foreign Relations, or lawyers like the New York prosecutor Cy Vance Jr., whose office tried to downgrade Epstein’s sex-offender status; Kenneth Starr, who tried to pressure Republican Justice Department officials to keep the Epstein case from ever being prosecuted; and Alan Dershowitz, who tried to pressure the Pulitzer Prizes to shut out the Miami Herald for its epic investigative reporting that cracked open the case anew.

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People are going to start talking soon, if only to protect themselves. But why hasn’t Maxwell been arrested yet?

Chelsea Clinton Denies Ties To Jeffrey Epstein’s Alleged ‘Madam’ (MN)

Since Jeffrey Epstein’s latest arrest on sex trafficking charges, a who’s who of the rich and powerful — notably Donald Trump, Prince Andrew and Bill Clinton — have rushed to downplay their associations with the financier who is accused of abusing underaged girls. Now Chelsea Clinton has joined her ex-president father on this who’s who list. Her representative issued a statement to Politico over the weekend denying reports that the former First Daughter was close friends with Ghislaine Maxwell, Epstein’s ex-girlfriend and the alleged “madam” who has been accused of helping him procure underaged girls for sex.

Politico’s report on Maxwell, 57, focuses on how the daughter of the late British publishing mogul Robert Maxwell helped Epstein, the Brooklyn-born son of a New York City parks groundskeeper, gain access to social circles that allowed him to become friendly with two U.S. presidents, billionaire business moguls, America’s media elite and at least one member of the British royal family. Maxwell has not been criminally charged, but has settled two lawsuits filed by women who say she participated in Epstein’s alleged sex trafficking, the New York Times reported last week. She has denied any wrongdoing. Politico said Maxwell first grew close to the Clinton family after former president Bill Clinton left office, and eventually became friends with Chelsea Clinton, vice chair of the Clinton Foundation.

According to the news outlet, the two women vacationed together on a yacht in 2009, and Maxwell attended Chelsea’s wedding to Marc Mezvinsky in 2010, Politico reported. A photo of Maxwell at the wedding has circulated online. Maxwell also participated in the Clinton Foundation’s Clinton Global Initiative as recently as 2013, through The TerraMar Project, an oceanic non-profit she founded, according to the Initiative’s website. The contacts between Chelsea Clinton and Maxwell appear to have occurred after Maxwell’s name first emerged in accounts of Epstein’s alleged sexual abuse. “Ghislaine was the contact between Epstein and Clinton,” a person familiar with the relationship told Politico. “She ended up being close to the family because she and Chelsea ended up becoming close.”

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May goes away in July. Bye.

UK’s May Takes Parting Shot at Putin in Desperate Diversion From Failure (SCF)

In what was billed as her last major speech before quitting Downing Street, Britain’s outgoing Prime Minister Theresa May focused her concerns on Russian President Vladimir Putin, lashing out at his “cynical falsehoods” and admonishing her successor “to stand up to” the Russian leader. Given her ignominious failure as premier over the Brexit fiasco, it seemed a strange choice of topic as she addressed the Chatham House think tank in London this past week. Her speech dealt with the wider theme of rising “populist politics” in the US and Europe. And she sought to portray Putin as an archetypal sinister figure fomenting populist threat to the “liberal” democratic order.

At one point, May claimed: “No one comparing the quality of life or economic success of liberal democracies like the UK, France and Germany to the Russian Federation would conclude that our system is obsolete.” This was supposed to be a riposte to an interview given by Putin to the Financial Times last month ahead of the G20 summit in Japan. During a lengthy interview on a wide range of issues, the Russian president was quoted as saying: “The liberal idea has become obsolete. It has come into conflict with the interests of the overwhelming majority of the population.”

Putin was apparently explaining a fairly straightforward and, to many observers, valid assessment of international politics. Namely, that Western establishments and institutions, including the mainstream media, are experiencing a crisis in authority. That crisis has arisen over several years due to popular perception that the governance of the political class is not delivering on democratic demands of accountability and economic progress. That in turn has led people to seek alternatives from the established parties, a movement in the US and Europe which is denigrated by the establishment as “populist” or rabble rousing.

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Boris is capable of doing very stupid things.

Iran Warns West Against Starting Conflict (R.)

Iran’s foreign minister warned the West on Monday against “starting a conflict,” saying it was not seeking confrontation after its military seized the British-flagged tanker Stena Impero in the Strait of Hormuz last week. London described the seizure of the Stena Impero as “state piracy” and on Monday called for a European-led naval mission to ensure safe shipping through the Strait of Hormuz. Speaking in Nicaragua, Foreign Minister Mohammad Zarif said Iran had taken measures against the ship to implement international law, not in retaliation for the British capture of an Iranian tanker two weeks earlier in Gibraltar.


“Starting a conflict is easy, ending it would be impossible,” Zarif told reporters after meeting his Nicaraguan counterpart. “It’s important for everybody to realize, it’s important for Boris Johnson to understand, that Iran does not seek confrontation,” he said, referring to the front-runner to become Britain’s new prime minister. “Iran wants to have normal relations based on mutual respect,” he added. Zarif said Iran acted when it observed that the UK ship did not follow regulations. “The UK ship had turned down its signal for more time than it was allowed to (and) was passing through the wrong channel, endangering the safety and security of shipping and navigation in the Strait of Hormuz, for which we are responsible,” Zarif said.

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France imports UK wind energy.

France To Shut Down Nuclear Plants Due To Heatwave (Montel)

French weather service Meteo France issued a 40C heatwave warning on Monday for 21 regions across France, while utility EDF will shut down nearly 3 GW of nuclear capacity this week amid cooling water issues. Golfech 2 (1.3 GW) on the Garonne river would be stopped from Tuesday at 23:00 until 29 July at 23:59, while Golfech 1 (1.3 GW) would be halted from Wednesday at 02:00 until 29 July at 23:59. Low river flows and high water temperatures can force operators to cut output if it breaches environmental limits. Flows on key French rivers had “significantly” weakened over the last two weeks amid persistent hot and dry weather, the ministry of energy told Montel recently.


The St Alban 1 and 2 (2.6 GW) reactors, meanwhile, saw their output cut over the weekend, and though both reactors are now back online, EDF warned last week it could curb output at its nuclear plants located along the river Rhone – which also included Bugey (3.7 GW) – due to declining flows amid the hot weather. The temperature of the Rhone around St Alban and Tricast in was currently 26C, while it was 23.4C at Bugey, estimates from Montel’s Energy Quantified showed, with 28C deemed unsafe. French TSO RTE expected power demand to peak at 59.4 GW on Thursday and 58.6 GW on Friday, with a surge expected due to an increase in need for cooling.

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Ugly. Peat fires are impossible to control.

Huge Swathes Of The Arctic On Fire, Satellite Images Show (Ind.)

Vast swathes of the Arctic are suffering from “unprecedented” wildfires, new satellite images have revealed. North of the Arctic circle, the high temperatures are facilitating enormous wildfires which are wreaking ecological destruction on a colossal scale. It comes after the world’s hottest June on record which has been followed by a devastating heatwave in the US, with Europe forecast for the same treatment later this week. Satellite images reveal fires across Greenland, Siberia and Alaska, with warm dry conditions following ice melt on the enormous Greenland icesheet commencing a month earlier than average.

Pierre Markuse, a satellite photography expert, posted images showing smoke billowing across massive areas of uninhabited and wild land. The pictures show forest fires and burning peat. They also reveal the extent of the damage the fires leave behind. In Alaska wildfires have already burned more than 1.6 million acres of land. Mark Parrington, a senior scientist at the European Centre for Medium-Range Weather Forecast, said the amount of CO2 emitted by Arctic wildfires between 1 June and 21 July 2019 is around 100 megatonnes and is approaching the entire 2017 fossil fuel CO2 emissions of Belgium.


Satellite image processed by Pierre Markuse showing numerous wildfires burning in Russia just south of the Arctic Circle (Pierre Markuse/Creative Commons)

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Jun 092019
 
 June 9, 2019  Posted by at 9:52 am Finance Tagged with: , , , , , , , , , , , ,  


Georges Seurat A Sunday Afternoon on the Island of La Grande Jatte 1884

 

Angst and Madness at the End of Empire (Orphan)
Theresa May: The Total Decay Of Political Integrity And Vision (Ind.)
Boris Johnson Threatens To Withhold $50 Billion Brexit Payment (R.)
US Auto Loans Hit Record (CNBC)
Used-Car Wholesale Prices Surge (WS)
ECB Policymakers Open To Cut Rates If Growth Weakens (R.)
China Banking Regulator Says Small Bank Risks Manageable (R.)
IMF Warns Of Giant Tech Firms’ Dominance (BBC)
Amazon Gets Booted by FedEx (WS)
The End Of The Arctic As We Know It (G.)

 

 

“..those expensive bases of aggression around the world will begin to cost more than they bring in profit.”

Angst and Madness at the End of Empire (Orphan)

[..] the angst of the American bourgeoisie is demonstrated more by what it doesn’t speak about than what it does. It is a disquiet which is at once terrified of the collapse that looms ahead and horrified at the idea of losing the status quo arrangement, even though that status quo is benefiting fewer and fewer people. It stands simultaneously aghast and paralyzed before the obvious madness of its rulers, and yet continually grasps at failed “lesser evilism” as a solution. And it largely still buys into the noxious mythology of it being the “greatest country on earth.” The corporate elite, having stripped down civic education over decades, robbed them of their political agency and resistance and replaced it with a sanitized history and demoralizing optimism, or “positive thinking,” which places all blame for their collective state and its inadequacies on the individual.

That it has been so lauded by Wall Street should cause anyone to wonder why it has been so internalized by the disenfranchised masses. To be sure, this arrangement is rapidly meeting its end. Banking and corporate corruption, never really having been dealt with in the last “Great Recession” or its notorious state funded “bailout,” has only become more blind and reckless. The membrane of the bubble created after that fiasco, born in avarice, is thinning in plain sight. It is about to burst again, and this time it will be far more catastrophic. The endless imperialistic wars that the US has engaged in for the last decades are also creating a financial strain.

Coupled with climate breakdown those expensive bases of aggression around the world will begin to cost more than they bring in profit. In the US itself biblical floods are wiping clean the soil graded for agriculture throughout the Midwest and causing tremendous economic hardship for scores of rural and commercial farmers. Droughts offer a grim alternative to this increasingly chaotic climate pattern. Food prices will undoubtedly rise in the future thanks to a capitalist system which creates artificial shortages and surpluses.

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“..our so called leaders are devoid of principle, immune to responsibility and seem only to prioritise their own interests, power and most importantly private profit above all. Theresa May is exhibit one. ”

Theresa May: The Total Decay Of Political Integrity And Vision (Ind.)

As an NHS doctor, making a diagnosis is quite an important part of my job. Central to it in fact. One has to process and put together information while providing care to your patients. Attention to detail is critical. For many of us working within the NHS therefore, it has been abundantly clear that the diagnosis for Theresa May has been terminal for some time. But where did it all go wrong? Was it always destined to end like this? What could have been done? Watching her face crumple and tears fall as she defended her claim to have “tackled Britain’s burning injustices”, as well as saying she had proudly served the country she loved, surely only the coldest of hearts could not have pity for a woman who had done her very best at the worst of times?

Well let me answer in the only way I know how: honestly, Theresa May is a mere symptom of the problem. The diagnosis is much greater and much more devastating than this one tragic figure. What we appear to be all bearing witness to is the total decay of political integrity and vision. We now live in a world where our so called leaders are devoid of principle, immune to responsibility and seem only to prioritise their own interests, power and most importantly private profit above all. Theresa May is exhibit one.

The woman who has supposedly tackled “burning injustices” has consciously implemented measures to ensure inequality has soared, overseen childhood and old-age poverty skyrocket, had life expectancy fall under her watch, ordered the Home Office to send out racist, xenophobic anti-immigration “Go Home” vans, and who oversaw a “hostile environment” policy that led to the deportation of many of the Windrush generation.

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Hollowness echoes with the people.

Boris Johnson Threatens To Withhold $50 Billion Brexit Payment (R.)

Boris Johnson, the leading candidate to succeed Theresa May as Britain’s next prime minister, said he would withhold a previously agreed 39 billion pound ($50 billion) Brexit payment until the European Union gives Britain better exit terms. The EU has repeatedly said it will not reopen discussion of the Brexit transition deal it reached with May last year, which British lawmakers have rejected three times, prompting May to announce her resignation earlier this month. May stepped down as leader of the governing Conservatives on Friday. Johnson, a former foreign secretary in May’s cabinet, is popular with ordinary Conservative Party members, who will decide between the two candidates who come top in a series of votes by Conservative lawmakers over the coming weeks.


“I always thought it was extraordinary that we should agree to write that entire cheque before having a final deal. In getting a good deal, money is a great solvent and a great lubricant,” Johnson told the Sunday Times. Britain is due to leave the EU on Oct. 31. If Parliament does not approve a deal – and the government does not ask the EU for another delay – there risks being major economic disruption from a disorderly departure. The 39 billion pounds represents outstanding British liabilities to the EU, which would be paid over a number of years according to the withdrawal agreement negotiated by May. Johnson also said border arrangements with Ireland should be settled only as part of a long-term agreement, rejecting a “backstop” which would avoid checks on Northern Ireland’s border but which Conservative lawmakers fear is a backdoor way of requiring Britain to continue to follow EU rules after Brexit.

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Record loans for clunkers.

US Auto Loans Hit Record (CNBC)

People buying a new vehicle are borrowing more and paying more each month for their auto loan. Experian, which tracks millions of auto loans each month, said the average amount borrowed to buy a new vehicle hit a record $32,187 in the first quarter. The average used-vehicle loan also hit a record, $20,137. “We have not seen a slowdown in loan demand. In fact, volume for new and used loans is up from previous years,” said Melinda Zabritski, senior director of automotive financial solutions for Experian. With sales of new vehicles moderating slightly after the four best years the industry has ever seen in the U.S., dealers and auto executives are watching whether consumers will be more resistant to the steady increase in new car prices.


That is not happening. In fact, the average amount borrowed topped $32,000 for the first time ever. As a result, the average monthly payment for a new vehicle continued to climb to a new high of $554 and to a record $391 for used vehicles, according to Experian. While new car sales and loans are still strong, people with the best credit scores are increasingly buying a used model instead of new. Experian says 61.8% of those with a prime credit rating and 44.7% of those with a super prime credit rating took out loans to buy a used vehicle in the first quarter. Those are the highest percentages Experian has ever recorded for prime and super prime used vehicle borrowing.

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There’s something very ironic hidden in here.

Used-Car Wholesale Prices Surge (WS)

Prices of used vehicle that were sold in May at wholesale auctions rose 4.0% compared to May last year, according to Manheim, the largest auto-auction house in the US, running about 8 million vehicles through its venues a year. The chart of the Manheim Used Vehicle Value Index, which is adjusted for mix, mileage, and seasonality, shows the two price surges from end of March 2017 and March 2018 that were subsequently only partially unwound. And the 2019 selling season is beginning likewise. The last time there was such an extended period of year-over-year price gains was from the trough of the Financial Crisis. After prices had collapsed in 2008, they started bouncing off sharply in January 2009.

By the time the “Cash for Clunkers” program started officially on July 1, 2009, used vehicle prices had already recovered to their prior pre-crisis levels (see chart below). But “cash for clunkers” boosted prices further. Congress had appropriated $1 billion that was supposed to last through November. But by July 30, it was gone. Congress appropriated another $2 billion, which was soon gone too. Car buyers were handed this $3 billion to trade in their “clunkers” and buy a new vehicle. Cash for clunkers was designed to boost new-vehicle sales. The engines of these trade-ins under the program were destroyed and the vehicle was then towed to the salvage yard for parts.


As a side effect, the program destroyed a portion of the most affordable vehicles – another devastating blow to lower-income car buyers in subsequent years. Not only were the most affordable vehicles gone; but by removing this supply from the market, Cash for Clunkers caused the prices up the entire scale of used cars to surge. This included my three-year-old car. Its book value rose month after month, even as the car got older and accumulated miles, something I’d never seen before, and I’d spent many years in the car business.

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So Europeans can buy clunkers too?!

ECB Policymakers Open To Cut Rates If Growth Weakens (R.)

European Central Bank policymakers are open to cutting the ECB’s policy rate again if economic growth weakens in the remainder of the year and a strong euro hurts a bloc already bearing the brunt of a global trade war, two sources said. The ECB said on Thursday that its interest rates would stay “at their present levels” until mid-2020 but President Mario Draghi added rate setters had started a discussion about a possible cut or fresh bond purchases to stimulate inflation. The apparently mixed message failed to convince some investors, who saw it as too tenuous a commitment to more stimulus. This sent the euro rallying to a 2-1/2 month high of $1.1347 against the U.S. dollar.


But two sources familiar to the ECB’s policy discussions said a rate cut was firmly in play if the bloc’s economy was to stagnate again after expanding by 0.4% in the first quarter of the year. “If inflation and growth slow, then a rate cut is warranted,” said one of the sources, who requested anonymity because the ECB’s deliberations are confidential. The ECB’s deposit rate is already 40 basis points below zero and the bloc’s top-rated governments, such as Germany’s, can borrow at negative rates for up to a decade. In this context, countering the euro’s strength, rather than lowering already rock-bottom borrowing costs, would be the main reason for a further cut to that deposit rate, one of the sources said.

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What else are they going to say?

China Banking Regulator Says Small Bank Risks Manageable (R.)

China’s banking regulator says risks at small and mid-sized banks are manageable, a central bank publication reported on Sunday, in the latest move to soothe investors’ concerns after the government took over a troubled regional lender last month. The China Banking and Insurance Regulatory Commission (CBIRC) took control of Inner Mongolia’s Baoshang Bank due to “serious” credit risks on May 24, rattling Chinese markets and prompting the People’s Bank of China (PBOC) to inject cash into the banking system. While authorities said it was a standalone case, the seizure comes as Beijing is urging banks to boost lending to help cushion an economic slowdown, fuelling concerns about rising debt and more bad loans.


“At present, small and mid-sized banks are operating smoothly, liquidity is relatively ample, and overall risks are fully manageable,” the CBIRC said in a Q&A interview with the Financial News. The regulator also said big banks are willing to continue interbank business with small banks to safeguard the stability of financial markets. Some small banks rely heavily on short-term borrowing from the interbank market, leaving other banks at risk if they run into trouble. A Reuters analysis showed at least 18 smaller institutions have not published up-to-date financial reports, and in some of those cases senior regulatory officials have been appointed for bank management oversight.

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Can I add a warning about IMF dominance?

IMF Warns Of Giant Tech Firms’ Dominance (BBC)

Giant technology companies might cause significant disruption to the world’s financial system, the head of the International Monetary Fund has warned. Christine Lagarde said just a few firms with big data access and artificial intelligence could run the global payment and settlement arrangements. Her warning came as the G20 finance ministers met in Japan. The summit is also discussing the need to close tax loopholes for internet giants like Facebook and Google. One of the options being considered is to tax such companies where they make their profits – rather than where they base their headquarters.


“A significant disruption to the financial landscape is likely to come from the big tech firms,” Ms Lagarde said in Japan’s south-western city of Fukuoka. She said such firms “will use their enormous customer bases and deep pockets to offer financial products based on big data and artificial intelligence”.”This presents a unique systemic challenge to financial stability and efficiency,” she added. She cited China as a most recent example. “Over the last five years, technology growth in China has been extremely successful and allowed millions of new entrants to benefit from access to financial products and the creation of high-quality jobs,” Ms Lagarde said. “But it has also led to two firms controlling more than 90% of the mobile payments market.”

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Can Bezos buy FedEx?

Amazon Gets Booted by FedEx (WS)

Amazon is aggressively butting in on freight carriers with its own planes, trucks, and delivery infrastructure, and is at the same time aggressively pushing for faster and cheaper service from freight carriers such as FedEx, UPS, and the US Postal Service. And FedEx has had it with Amazon, announcing today that it was dumping Amazon as customer of its FedEx Express division. “FedEx has made the strategic decision to not renew the FedEx Express U.S. domestic contract with Amazon.com, Inc. as we focus on serving the broader e-commerce market,” it said in a surprise statement. The current contract ends June 30.


Its other units that do business with Amazon and its international services with Amazon are not impacted by this decision, FedEx said. FedEx is not overly dependent on Amazon – unlike some other freight companies that now have come to grief under Amazon’s boots, including New England Motor Freight, a less-than-truckload carrier that “stunned” the transportation world when it filed for bankruptcy in February. Interestingly, FedEx chose to address this point explicitly in the statement: “Amazon.com is not FedEx’s largest customer. The percentage of total FedEx revenue attributable to Amazon.com represented less than 1.3 percent of total FedEx revenue for the 12-month period ended December 31, 2018.”

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“It will go when stratification breaks down completely and the Atlantic takes over the whole region.”

The End Of The Arctic As We Know It (G.)

If the Arctic were a patient, doctors would be alarmed by its vital signs. As well as hot flushes, asthma and contamination (the researchers are following up on studies that suggest the Fram strait has one of the highest levels of microplastics in the world), the ocean has also been diagnosed with a weakening of its immune system. For centuries, the Arctic’s distinctive character has been shaped by a layer of cold, relatively fresh water just below the surface, produced by melting ice and glaciers. This has insulated the sea ice from the warmer, denser, saltier waters of the Atlantic currents that flow in the depth. But this stratification is collapsing as temperatures rise.

The oceanic shift was outlined in a landmark study published last year in Science, which found that the water density and temperature of the Fram strait and Barents Sea were increasingly like those of the Atlantic, while further east, Russia’s Laptev sea was starting to resemble what the Barents used to be. “The polar front is shifting,” the lead author, Dr Sigrid Lind, of the Institute of Marine Science and the University of Bergen, told the Guardian this year. “The Arctic as we know it is about to become history. It will go when stratification breaks down completely and the Atlantic takes over the whole region.”


This has not happened for more than 12,000 years, but the shift is well under way. First to succumb, according to Lind, will be the Barents Sea, which will have no fresh water by 2040, then the Kara sea. The consequences will be far-reaching. The food chain is already affected. Atlantic species of cod, herring and mackerel are moving northwards. For the next 20 to 30 years this could boost fishing catches, but forecasts by Norway suggest boom will turn to bust later as the waters grow too warm for fish larvae.


Photograph: Denis Sinyakov/Greenpeace

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Jun 042019
 
 June 4, 2019  Posted by at 9:35 am Finance Tagged with: , , , , , , , , ,  


Henri Matisse Still Life with Apples on Pink Cloth 1925

 

Repeal the Espionage Act (FFF)
Swedish Court Rejects Request To Detain Julian Assange (G.)
US Moving Toward Major Antitrust Probe Of Tech Giants (R.)
Tech Stocks Crushed by Potential “Unprecedented, Wide-Ranging Probe” (WS)
Amazon and Facebook Both Want To Read Human Emotions (Kesel)
House To Vote Next Week On Whether To Find Barr, McGahn In Contempt (R.)
The Zeitgeist Knows (Kunstler)
New Poll Finds 61% Would Back Remain In A Second Referendum (TNE)
Canadian Inquiry Calls Deaths Of Indigenous Women ‘Genocide’ (R.)
The Great Insect Dying (Hance)
Arctic Is Thawing So Fast Scientists Are Losing Their Measuring Tools (TO)
High Likelihood of Human Civilization Coming to an End in 2050 (Nafeez Ahmed)

 

 

A good place to start.

Repeal the Espionage Act (FFF)

World War I is the gift that just keeps on giving. Although the U.S. government’s intervention into this senseless, immoral, and destructive war occurred 100 years ago, the adverse effects of the war continue to besiege our nation. Among the most notable examples is the Espionage Act, a tyrannical law that was enacted two months after the U.S. entered the war and which, unfortunately, remained on the books after the war came to an end. In fact, it is that World War I relic that U.S. officials are now relying on to secure the criminal indictment of Julian Assange, the WikiLeaks head who released a mountain of evidence disclosing the inner workings and grave wrongdoing on the part of the U.S. national-security establishment, especially with respect to the manner in which it has waged it undeclared forever wars in the Middle East and Afghanistan.

Some news media commentators are finally coming to the realization that if the Espionage Act can be enforced against Assange for what he did, it can be enforced against anyone in the press for revealing damaging inside information about the national-security establishment — i.e., the Pentagon, the CIA, and the NSA. Therefore, they are calling on the Justice Department to cease and desist from its prosecution of Assange. Of course, they are right, but the problem is that they don’t go far enough. Their mindsets reflect the customary acceptance of the status quo. The mindset is that we Americans simply have to accept the way things are and plead with the government to go easy on us.

That’s just plain nonsense. It is incumbent on the American people to start thinking at a high level, one that doesn’t just accept the existence of tyrannical laws and instead calls for their repeal. [..] Wilson had to force American men to fight in World War I. He conscripted them. Enslaved would be a better word. When a government has to force its citizens to fight a particular war, that’s a good sign that it’s a bad war, one that shouldn’t be waged. In fact that was one of the reasons for the Espionage Act—not to punish people for spying but rather for criticizing the draft and the war. The law converted anyone who publicly criticized the draft or attempted to persuade American men to resist the draft into felons. And make no mistake about it: U.S. officials went after such people with a vengeance, doing their best to punish Americans for doing nothing more than speaking.

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The only thing that makes any sense is to close the case immediately.

Swedish Court Rejects Request To Detain Julian Assange (G.)

An attempt to extradite Julian Assange to Sweden has suffered a setback after a court in Uppsala said he did not need to be detained. The ruling by the district court prevents Swedish prosecutors from applying immediately for an extradition warrant for Assange to face an allegation of rape dating back to 2010. Assange denies the accusation. Assange is serving a 50-week sentence in Britain for skipping bail after he spent seven years in the Ecuadorian embassy in London attempting to avoid extradition to Sweden. Swedish prosecutors dropped their rape investigation in 2017 but reopened it after Ecuador rescinded its grant of asylum to Assange in April this year and allowed British police to arrest him.

The 47-year-old Australian was too ill to appear last week at the latest hearing at Westminster magistrates court in relation to a rival US extradition request. US government lawyers are seeking his removal to the US where he is charged with conspiracy to commit computer intrusion, which carries a maximum penalty of five years. He also faces additional charges of violating the Espionage Act by publishing classified information through WikiLeaks. If both Sweden and the US present competing extradition requests, it will be up to the UK home secretary, Sajid Javid, to decide which application takes priority. At the Swedish court on Monday, a judgment was read out saying that since Assange was already in a British prison he did not need to be formally detained to be questioned by Swedish prosecutors.

“As Julian Assange is currently serving a prison sentence, the investigation can proceed with the help of a European investigation order, which does not require Julian Assange’s detention (in Sweden). The court therefore does not find it proportional to detain Julian Assange,” the judgment said. Assange’s Swedish defence lawyer, Per Samuelson, argued that Assange’s imprisonment in Britain meant there was no flight risk. “He is in prison for half a year at least, and he is detained on behalf of the United States. So there is no point detaining him in Sweden too,” Samuelson said.

Responding to the ruling, the Swedish prosecutor Eva-Marie Persson said: “The investigation continues with interviews in Sweden. I will also issue a European investigation order in order to interview Julian Assange. No date has been set yet. We will constantly review the state of the investigation.” Before the judgment, the prosecutor confirmed that if the court granted her request she intended to issue a European arrest warrant for Assange “concerning surrender to Sweden”.

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May take years.

US Moving Toward Major Antitrust Probe Of Tech Giants (R.)

The U.S. government is gearing up to investigate whether Amazon, Apple, Facebook and Google misuse their massive market power, sources told Reuters on Monday, setting up what could be an unprecedented, wide-ranging probe of some of the world’s largest companies. The Federal Trade Commission and the Department of Justice, which enforce antitrust laws in the United States, have divided oversight over the four companies, two sources said, with Amazon and Facebook under the watch of the FTC, and Apple and Google under the Justice Department.


With jurisdiction established, the next step is for the two federal agencies to decide if they want to open formal investigations. Results are not likely to be quick. A previous FTC probe of Google took more than two years. Technology companies face a backlash in the United States and across the world, fueled by concerns among competitors, lawmakers and consumer groups that the firms have too much power and are harming users and business rivals. Shares of Facebook Inc fell 7.5% on Monday while Google’s owner Alphabet Inc shed more than 6%. Amazon.com Inc shares fell 4.6% and Apple Inc dipped 1%.

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Pretty wild swings.

Tech Stocks Crushed by Potential “Unprecedented, Wide-Ranging Probe” (WS)

It’s a rare moment in recent years that US government regulators are suddenly going after four tech and social media giants simultaneously – Facebook, Amazon, Google, and Apple. These four companies are part of my FANGMAN index that also includes Microsoft, Nvidia, and Netflix. The index dove 4.3% today, the biggest percentage decline since the infamous 4.6% drop on December 24, 2018. In terms of dollars, $137 billion in market capitalization was wiped out. Over the past four trading days the FANGMAN index has dropped by 6.6%. I highlighted today’s move in red (market cap data via YCharts):

The index has gone through some brain-twisting surges and plunges over the past two years. It peaked on August 31, 2018 (at $4.63 trillion), then plunged 29% by December 24 (to $3.29 trillion), then exploded 40% higher by April 29. But that day, at $4.61 trillion, it failed to take out the August high. And then the selling started. Since April 29, the FANGMAN index has dropped 14.0%, or by $645 billion in market cap, giving up 49% of the post-Christmas rally in just five weeks.

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And here’s that Orwell guy again.

Amazon and Facebook Both Want To Read Human Emotions (Kesel)

Facebook and Amazon’s insanity only seems to continue with no sign of slowing down anytime soon. Now, the two big conglomerate giants want to move into the uncharted territory of reading human emotions, both in their own ways. Facebook wants a robot that has five senses which can read human emotions. Facebook wants “emotionally sensitive” robots that can explore the world, identify objects and people and enable its users to make more friends, Dailymail reported. The robots would be fitted with wheels or tank-like caterpillar treads that would allow them to trundle about their environment. Alternatively, such robots could be fitted out with drive systems that would allow them to move around underwater, fly through the air or float in space, Facebook suggest in their patent.


I am not sure why anyone would trust Facebook with data ever again, let alone biometric data, after all the numerous scandals Activist Post has documented including data mining. But to each their own I guess. Amazon is also looking into reading human emotions in a completely different way by utilizing a voice-activated wearable device, that will sense its wearer’s state of mind by the tone of voice, Bloomberg reported. It’s worth noting that both companies have a smart home device, and after reading this you should fear what information is being gathered by the cameras and microphones attached to those electronics … besides the typically targeted advertising to turn consumers into the product.

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The Democrats need to hurry with that impeachment plan, lest ‘the other side’ starts handing out indictments.

House To Vote Next Week On Whether To Find Barr, McGahn In Contempt (R.)

The U.S. House of Representatives will vote next week on whether to hold Attorney General William Barr and former White House counsel Don McGahn in contempt of Congress for failing to comply with subpoenas related to the probe into Russian meddling in the 2016 election, the No. 2 House official said on Monday. “Next Tuesday, I will bring a resolution to the House floor forcing Attorney General Barr and former White House counsel McGahn to comply with congressional subpoenas that have been duly issued by the House Judiciary Committee,” House Majority Leader Steny Hoyer said in a statement. “The resolution will authorize the Judiciary Committee to pursue civil action to seek enforcement of its subpoenas in federal court,” said Hoyer, a Democrat.


The House move escalated the fight between the Republican White House and Democrats who control the House and are seeking documents and testimony relating to various investigations, ahead of the 2020 presidential election in which President Donald Trump is seeking a second term. The House Judiciary Committee voted on May 8 to recommend that the full House cite Barr, the top U.S. law enforcement official and a Trump appointee, for contempt of Congress after he defied its subpoena to hand over an unredacted version of Special Counsel Robert Mueller’s report on 2016 Russian election interference. Democrats had also subpoenaed McGahn to testify before the Judiciary Committee last month, but he did not appear after the White House directed him not to comply.

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“Everybody’s broke, one way or another, even though they are up to their eyeballs in products designed to fall apart in a few years.”

The Zeitgeist Knows (Kunstler)

Who said the global economy was a permanent installation in the human condition? The head cheerleader was The New York Times’s Tom Friedman, with his 1999 book, The Lexus and the Olive Tree, the trumpet blast for the new order of things. Since then, we partied like it was 1999, with a few grand mal seizures of the banking system along the way, some experiments in creating failed states abroad, and the descent of America’s middle-class into a Disney version of Hieronymus Bosch’s Last Judgment — which is kind of what you see on the streets of Los Angeles these days.

Guess what: the global economy is winding down, and pretty rapidly. Trade wars are the most obvious symptom. The tensions underlying that spring from human population overshoot with its punishing externalities, resource depletion, and the perversities of money in accelerated motion, generating friction and heat. They also come from the fact that techno-industrialism was a story with a beginning, a middle, and an end — and we’re closer to the end than we are to the middle. There will be no going back to the prior party, whatever way we pretend to negotiate our way around or through these quandaries.

The USA-China romance was bound to end in divorce, which Mr. Trump is surreptitiously suing for now under the guise of a negotiated trade rebalancing. The US has got a chronic financial disease known as Triffin’s Dilemma, a set of disorders endemic to any world reserve currency. The disease initially expressed itself in President Nixon’s ditching the US dollar’s gold backing in 1971. By then, the world had noticed the dollar’s declining value trend-line, and threatened to drain Fort Knox to counter the effects of holding those dollars. Since then, all world currencies have been based on nothing but the idea that national economies would forever and always pump out more wealth.

It turns out that they pump out more debt in the pursuit of that chimerical wealth until the economic viziers and banking poohbahs begin to declare that debt itself is wealth — and now all the major players around the world are choking to death on that debt, especially the USA and China, but also Japan and the dolorous commune known as the EU. Everybody’s broke, one way or another, even though they are up to their eyeballs in products designed to fall apart in a few years. Better learn how to fix stuff, especially machines, because a lot of it won’t be replaced going forward.

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Explosive.

New Poll Finds 61% Would Back Remain In A Second Referendum (TNE)

New polling has found that 61% of those who would vote in a second referendum would vote to Remain in the European Union. The YouGov survey for KIS Finance found that between the choice of Theresa May’s Brexit deal or remaining in the EU, 61% of those who confirmed they would vote stated they wanted the UK to stay in the European Union. When a no-deal scenario is added into the mix, 53% of people would vote to Remain, while 34% would vote for no-deal, and just 12% would vote for Theresa May’s deal. The research also uncovered that 1 in 10 have put off important financial decisions, such as buying their first home, moving house, spending money on home improvements, investing and making major purchases such as a car, until the future of Brexit is clear. In London this figures rises to 1 in 5 who have delayed key financial decisions as a direct result of Brexit.

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No words. How can a country allow this to happen?

Canadian Inquiry Calls Deaths Of Indigenous Women ‘Genocide’ (R.)

The deaths in Canada of more than a thousand aboriginal women and girls in recent decades was a national genocide, a government inquiry into murdered and missing indigenous women concluded in a report on Monday. The 1,200-page report, which resulted from an inquiry launched by Prime Minister Justin Trudeau’s government in 2016, blamed the violence on long-standing discrimination against indigenous people and Canada’s failure to protect them. It also made sweeping recommendations to prevent future violence against indigenous women. The Royal Canadian Mounted Police revealed in 2014 that 1,017 aboriginal women had been murdered between 1980 and 2012.


The inquiry, which was beset by delays and staff resignations, opened painful wounds as it heard testimony from 468 family members of missing or murdered women. “This colonialism, this discrimination and this genocide explains the high rates of violence against indigenous women, girls, 2SLGBTQQIA people,” Marion Buller, the chief commissioner of the inquiry, said at a ceremony held to present the report. The 2SLGBTQQIA group refers to two-spirit, lesbian, gay, bisexual, transgender, queer, questioning, intersex and asexual people. “An absolute paradigm shift is required to dismantle colonialism in Canadian society. And this paradigm shift must come from all levels of government and public institutions,” Buller said.

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“To assess the range of scientific opinion, Mongabay interviewed 24 entomologists and other scientists working on six continents, in more than a dozen countries, to better determine what we know, what we don’t, and, most importantly, what we should do about it. This is part one of a four-part exclusive series by Mongabay senior contributor Jeremy Hance.”

The Great Insect Dying (Hance)

Humans like to think we run the world, believing in our omnipotence. But while we shape and engineer — make, muddle and destroy — we are not, according to scientists, the world’s ultimate controllers. That role clearly falls to insects, “the little things that run the world,” as E.O. Wilson, the world’s pre-eminent entomologist, told us back in 1987. Insects may be tiny, but they are mighty and superabundant. British entomologist and ecologist C.B. Williams once estimated a population of one million trillion insects on Earth at any given time. They are everywhere that there is land and sky — intimately involved with everything.


Mirror image? Two look-alike insects photographed in Southeast Asia. Image by Tan Ming Kai

Insects tend to every square centimeter of living soil; they aerate and fertilize; they breakdown the billions of bits of organic debris and waste that other Earth residents produce, disposing of everything from leaf litter to elephant dung. Insects are the original recyclers, digesting dead wood and dead bodies. They also reside at the base of the food chain, feeding tens of thousands of birds, mammals, reptiles, amphibians, fish — and, by extension, us. More than 300,000 known plants are pollinated by animals, most of them insects.


It’s estimated that all the world’s arthropods, a group that includes insects, arachnids, millipedes, centipedes and crustaceans, weigh 17 times more than the planet’s 7.5 billion humans. Take away this vast mass of crawling, fluttering, skittering insects — comprising maybe 90 percent of all animal species — and you’re truly staring planetwide ecological breakdown in the eye. Waste will pile up; soil will shed nutrients without replacement; animals will starve; and potentially hundreds of thousands of plant species will vanish. Extinction would stalk the land like a famished beast, and the future of humanity would be at stake.


The Schoenherr blue weevil (Eupholus schoenherrii) is a spectacular blue and turquoise beetle from New Guinea. Image by Rhett Butler/Mongabay

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Tools swallowed up by thawing soil.

Arctic Is Thawing So Fast Scientists Are Losing Their Measuring Tools (TO)

Greenland is melting much faster than previously understood, as melting has increased six-fold in recent decades, according to a study published in the Proceedings of the National Academy of Sciences. “We wanted to get a long precise record of mass balance in Greenland that included the transition when the climate of the planet started to drift off natural variability, which occurred in the 1980s,” study co-author Eric Rignot told CNN. “The study places the recent (20 years) evolution in a broader context to illustrate how dramatically the mass loss has been increasing in Greenland in response to climate warming.”

Rignot added, “As glaciers will continue to speed up and ice/snow melt from the top, we can foresee a continuous increase in the rate of mass loss, and a contribution to sea level rise that will continue to increase more rapidly every year.” The study also shows how sea level rise is accelerating, and will continue to do so with each passing year, as the effects compound upon themselves. On that note, Indonesia recently announced it will be moving its capital city of Jakarta, partly due to the sinking of the land and sea level rise. This is a city of 10 million people.

Permafrost in the Arctic is now thawing so fast that scientists are literally losing their measuring equipment. This is due to the fact that instead of there being just a few centimeters of thawing each year, now several meters of soil can become destabilized in a matter of days. Adding insult to injury, another study revealed that this permafrost collapse is further accelerating the release of carbon into the atmosphere, possibly even doubling the amount of warming coming from greenhouse gases released from the tundra. Already in Greenland, the ice sheet’s melt season began about a month early while in Alaska, several rivers saw winter ice break up on their earliest dates on record.

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It’s life, captain, but no longer as we know it.

The headline may look crazy, but Nafeez is not a crazy man.

High Likelihood of Human Civilization Coming to an End in 2050 (Nafeez Ahmed)

A harrowing scenario analysis of how human civilization might collapse in coming decades due to climate change has been endorsed by a former Australian defense chief and senior royal navy commander. The analysis, published by the Breakthrough National Centre for Climate Restoration, a think-tank in Melbourne, Australia, describes climate change as “a near- to mid-term existential threat to human civilization” and sets out a plausible scenario of where business-as-usual could lead over the next 30 years. The paper argues that the potentially “extremely serious outcomes” of climate-related security threats are often far more probable than conventionally assumed, but almost impossible to quantify because they “fall outside the human experience of the last thousand years.”

On our current trajectory, the report warns, “planetary and human systems [are] reaching a ‘point of no return’ by mid-century, in which the prospect of a largely uninhabitable Earth leads to the breakdown of nations and the international order.” The only way to avoid the risks of this scenario is what the report describes as “akin in scale to the World War II emergency mobilization”—but this time focused on rapidly building out a zero-emissions industrial system to set in train the restoration of a safe climate.

The scenario warns that our current trajectory will likely lock in at least 3 degrees Celsius (C) of global heating, which in turn could trigger further amplifying feedbacks unleashing further warming. This would drive the accelerating collapse of key ecosystems “including coral reef systems, the Amazon rainforest and in the Arctic.” The results would be devastating. Some one billion people would be forced to attempt to relocate from unlivable conditions, and two billion would face scarcity of water supplies. Agriculture would collapse in the sub-tropics, and food production would suffer dramatically worldwide. The internal cohesion of nation-states like the US and China would unravel.

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“If we are (almost) the only animal with a sense of justice, it is because we also are (almost) the only animal with a sense of cruelty.”
– Nassim Nicholas Taleb

 

 

 

 

Sep 292018
 
 September 29, 2018  Posted by at 9:20 am Finance Tagged with: , , , , , , , , , ,  


M. C. Escher Corte, Corsica 1928

 

Trump Orders New FBI Probe Into Kavanaugh Following Senate Request (Ind.)
The Return Of The Inquisition (Simon Black)
Fiscal Irresponsibility (Roberts)
Junk Bonds Set For Record Winning Streak, High Grade Worst Since 2008 (ZH)
Elon Musk Believed He Had Verbal Deal With Saudis To Take Tesla Private (WSJ)
Labour Claims Theresa May’s Government ‘The Most Divided Ever’ (Ind.)
Boris Johnson’s ‘Super Canada’ Alternative Brexit Plan Rubbished (G.)
Democratizing Brexit (Varoufakis)
Facebook Says Nearly 50m Users Compromised In Huge Security Breach (G.)
Melting Arctic Ice Opens New Route From Europe To East Asia (AP)

 

 

“This country is being ripped apart here,” Mr Flake told the committee…

Trump Orders New FBI Probe Into Kavanaugh Following Senate Request (Ind.)

Donald Trump has ordered the FBI to carry out a fresh investigation into his nominee for the Supreme Court, after Republicans were obliged to delay a full confirmation vote after being blind-sided by one of their own senators. During a day of blurred and frequently confusing drama on Capitol Hill, the Senate Judiciary Committee on Friday voted 11-10 to approve Brett Kavanaugh for a confirmation vote in the full senate. But it did so, only after an 11th hour intervention from Jeff Flake, a senator from Arizona, who said his support in the later confirmation vote was dependent on the FBI being given a week to carry out an investigation into Mr Kavanaugh, the subject of sexual assault allegations from several women, all of which he denies.

“This country is being ripped apart here,” Mr Flake told the committee, after a vote scheduled for 1.30pm was delayed. “We ought to do what we can to make sure that we do all due diligence with a nomination this important.” Mr Flake’s deeds sent senior Republicans scrambling to decide how best to proceed. The senate’s Republican chairman, Chuck Grassley, who has long said he did not see the need for an additional investigation into Mr Kavanaugh, said it was the decision of Senate majority leader Mitch McConnell on when to hold the confirmation vote.

Within a matter of hours, Mr Grassley issued a statement saying he would ask the White House to request the FBI carry out an additional background check. Shortly afterwards, White House press secretary Sarah Huckabee Sanders released a statement from the president, which read: “I’ve ordered the FBI to conduct a supplemental investigation to update Judge Kavanaugh’s file. As the senate has requested, this update must be limited in scope and completed in less than one week.”

[..] Mr Flake may have been motivated to act by the words of two protesters who confronted him in a senate elevator after it was initially announced he would back Mr Kavanaugh. “What you are doing is allowing someone who actually violated a woman to sit on the Supreme Court. This is not tolerable. You have children in your family. Think about them. I have two children,” shouted one of the women, Ana Maria Archila. “I cannot imagine that for the next 50 years they will have to have someone in the Supreme Court who has been accused of violating a young girl. What are you doing, sir?”

Read more …

Plenty angles: … trial by social media…

The Return Of The Inquisition (Simon Black)

Senator Maize Hirono of Hawaii recently stated, “Not only do women like [Kavanaugh’s accuser], who bravely come forward, need to be heard, but they need to be believed.” By definition this is neither fair nor impartial, and turns the entire process into a Kangaroo Court… which is what the Senate has become. At a certain point yesterday, one Senator introduced multiple pieces of evidence on behalf of the accuser, including ‘expert reports’ that justify her inability to remember details from the assault. This is truly bizarre. These Senators are playing the role of judge in this matter. It seems impossible to do this while simultaneously acting as advocate for the accuser.

Another Senator sat smugly and sanctimoniously, leering down at Brett Kavanaugh and demanding explanations about code words for beer and flatulence that date back to Kavanaugh’s high school days. The fact that a United States Senator would actually consider this important evidence is an utter embarrassment. Another disgusting perversion of justice is that the United States Senate actually felt compelled to negotiate with the accuser about when/how she would testify. For example, the accuser wanted to prohibit certain questions, control who could/could not ask questions, determine the order of witness testimony, etc. This is simply NOT how the justice system is supposed to work.

[..] the saddest part – this manner of Inquisition… trial by social media… has now been condoned and advanced by the United States Senate, an institution whose members have ALL taken a solemn oath to support and defend the Constitution which they are now violating in the worst way. Clearly the Senate is no longer an assembly of kings… but a brood of bickering, immature weaklings. (The only resilience displayed has been from the accused and accuser, both of whom have had to endure insane public scrutiny.) There’s obviously an agenda here.

Perhaps some Senators are trying to win points with the #metoo movement for the upcoming elections. Or they’re intentionally blocking Kavanaugh simply because he is a Trump nominee. Whatever their reasons, they may be victorious in achieving their desired outcome. But it will be a Pyrrhic victory… for it will come at the expense of establishing a dangerous new standard that destroys the most important principles of Justice.

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As deficits grow, liquidity is shrinking.

Fiscal Irresponsibility (Roberts)

Without much fanfare or public discussion, Congress has decided to push the U.S. into deeper fiscal responsibility. Earlier this week, the House passed another Continuing Resolution (CR) to keep the government from “shutting down” prior to the mid-term elections. “The House on Wednesday passed an $854 billion spending bill to avert an October shutdown, funding large swaths of the government while pushing the funding deadline for others until Dec. 7. The bill passed by 361-61, a week after the Senate passed an identical measure by a vote of 93-7.” For almost a decade, Congress has failed to pass, and operate, underneath a budget.

Of course, without any repercussions from voters in demanding that Congress “does their job,” the path to fiscal insolvency continues to grow. The Committee For A Responsible Federal Budget made the following statement: “We’re pleased policymakers have likely avoided a shutdown and actually appropriated most of this year’s discretionary budget on time. But let’s not forgot that Congress did so without a budget and had to grease the wheels with $153 billion to pass these bills. That isn’t function; it’s a fiscal free-for-all.” Of course, with trillion-dollar deficits just around the corner, the negative impact from unbridled spending and debt increases will begin to reverse the positive effects from deregulation and tax reform.

The bigger problem with the $854 billion CR just passed by the House, and awaiting the President’s signature, is that it only covers spending from now until December. Such means that by the time we get the full 2019 budget funded, with the annual automatic increases still in place, we will be looking at more than $2 Trillion in annual spending. Such will require further increases in debt issuance at a time when there are potentially fewer buys of Treasuries readily available. As shown in the chart below, with the major Central Banks reducing their balance sheets simultaneously, some of the more major buyers are being removed from the market. “Central bank balance sheets have shrunk by over half-a-trillion dollars since March. This decrease in global liquidity – in the face of a global slowdown – raises the risk of policy mistakes much higher than is commonly assumed.” – ECRI

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Courtesy of your friendly neighborhood central bank.

Junk Bonds Set For Record Winning Streak, High Grade Worst Since 2008 (ZH)

For the latest confirmation of the upside down market, look no further than corporate bonds where the riskiest, CCC-rated junk bonds are set to make a positive return for the 3rd consecutive year, the longest winning streak since records began in 1997. Not only have the lowest quality junk bonds, those rated CCC or lower, generating respectable absolute returns of 5.8% YTD, they have also outperformed higher quality debt with a 1% total return so far this month, according to Bloomberg and ICE data. Additionally, the lowest rated junk bonds have also outperformed the broader junk bond index, which has returned 1.9% YTD.

And while the key contributor to the outperformance of lowest-rated bonds is demand for, well, higher yielding paper as investors continue to chase returns, a key structural issue has been the lack of HY supply, which at $150 billion YTD is the lowest since 2009. Meanwhile, as investors scramble for any paper that promises a material yield, regardless of underlying fundamentals, investment grade corporate bond returns have, in the worlds of Bloomberg’s James Crombie “fallen from darling to deadbeat.”

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Perhaps the biggest risk is that Tesla shares fall and loans have to be rolled over.

Elon Musk Believed He Had Verbal Deal With Saudis To Take Tesla Private (WSJ)

Tesla Inc. CEO Elon Musk believes he had a verbal agreement in place with Saudi Arabia’s sovereign-wealth fund to help finance a plan to take the auto maker private, according to a person familiar with the matter, a contention that could preview how he will fight regulators’ accusation that he misled shareholders. Musk was sued Thursday by the Securities and Exchange Commission, which alleged that he misled investors when he tweeted last month that he had funding secured to lead a Tesla buyout. The agency, which is seeking to oust Musk from Tesla, said in its complaint that he “knew that he had never discussed a going-private transaction at $420 per share with any potential funding source.”

Musk believes the SEC’s effort is flawed in assuming that a written agreement and fixed price were necessary for a deal, the person said. Musk also thinks regulators aren’t taking into account that Middle Eastern businesses routinely operate using verbal agreements in principle, the person said. In addition, Musk has told people that he could have led a go-private transaction using his own stake in SpaceX, if major Tesla investors were on board. SpaceX is the privately held aerospace firm that Mr. Musk controls and is valued at tens of billions of dollars.

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Tory conference soon. Spectacle.

Labour Claims Theresa May’s Government ‘The Most Divided Ever’ (Ind.)

Labour has accused Theresa May of leading “the most divided government ever” as it released a dossier claiming a third of Conservative MPs have publicly criticised either the government or a Tory colleague within the last year. On the eve of the Conservatives’ annual conference, Labour said more than 100 Tory MPs have recently turned their fire on a colleague or on government policy. The report said 80 per cent of the attacks were directed at Ms May or her government, with 83 MPs having criticised one of the two. The dossier was released as a number of senior Conservatives spoke out against Ms May’s leadership and voiced fears about the prospects of the party.

Much of the criticism outlined in the Labour document relates to Ms May’s Chequers plan for Brexit, which has been widely condemned by both Eurosceptics and Remain supporters on the Tory benches. It has been called “unworkable” by Justine Greening, the pro-European former education secretary, while former Brexit minister Steve Baker said it could lead to a “catastrophic split” in the Conservative Party. Mike Penning, previously seen as an ally of Ms May, described the plan as “dead as a dodo”, and former cabinet minister Priti Patel said it would be “a disaster for our country”. Ms May is facing mounting pressure to ditch the proposals, which are also highly unpopular with Tory members and have been rejected by EU leaders.

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EU has already thrown out Chequers.

Boris Johnson’s ‘Super Canada’ Alternative Brexit Plan Rubbished (G.)

Furious ministers rounded on Boris Johnson for suggesting the UK could renege on its Brexit agreements over the Irish border, calling it unworkable and criticising the former foreign secretary for denouncing agreements made while he was a cabinet minister. The Department for Exiting the European Union issued a defiant statement rejecting Johnson’s alternative, laid out in a 4,000-word Telegraph article, saying it was “not a workable or negotiable plan,” less that two days before the start of the Conservative party conference in Birmingham. Government sources mocked Johnson’s disavowal of the December withdrawal agreement, when he had been part of the cabinet that approved it, dismissing his intervention as “another very lengthy article which doesn’t offer any answers”.

Speaking ahead of the conference, May said the government was on the verge of a Brexit deal, despite admitting after the EU summit in Salzburg that the two sides remained some distance apart on customs and the Northern Irish border. “The right deal is close – and with it the opportunity to make life better for ordinary working people,” she said. But Johnson continued his public intervention with a series of television interviews – his first since quitting over Chequers – criticising the prime minister, warning May that she risked betraying the wishes of leave voters if she persisted with the Chequers deal but stopping short of calling her to go. Johnson told the BBC: “If you stick with Chequers, the electorate of this country will look at what we have produced and think how on Earth was that the outcome of voting leave.”

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If people want a second vote, isn’t that democratic?

Democratizing Brexit (Varoufakis)

As deadlines approach and red lines are redrawn in the United Kingdom’s impending withdrawal from the European Union, it is imperative for the people of Britain to regain democratic control over a process that is opaque and ludicrously irrational. The question is: How? Democracy can never aspire to being more than a work in progress. Decisions made collectively must constantly be reappraised collectively in the light of new evidence. Yet, in the UK’s current circumstances, nothing would be more poisonous to democracy than revisiting Brexit by means of a second referendum.

Both sides, Leavers and Remainers, feel betrayed. Even though Brexit was meant to restore its sovereignty, Parliament has no real say in a process that will mark Britain for decades to come. The Scots and the people of Northern Ireland are hostages to a distinctly English feud that could do them serious damage. The young feel the old have hijacked their future, while the old feel that their accumulated wisdom and legitimate concerns are being ignored by insiders striking bad deals behind closed doors on behalf of vested interests. In short, British democracy is failing its latest and most stringent test.

But a fresh referendum cannot be the answer to the unfolding disaster triggered by the original referendum. In June 2016, a stark choice was available to the people of Britain: leave the EU or stay in. While one can question the wisdom of making such a collective choice via a referendum, the logical coherence of the enterprise was beyond dispute. Once the verdict came in, and the process stipulated by the Treaty of Lisbon’s Article 50 was triggered, no binary yes-or-no choice to steer Britain out of its mess became available. In fact, there are now at least five options that must be collectively appraised.

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Oh, yeah, that has them worried. They want their friends spying on you, and nobody else.

Facebook Says Nearly 50m Users Compromised In Huge Security Breach (G.)

Nearly 50m Facebook accounts were compromised by an attack that gave hackers the ability to take over users’ accounts, Facebook revealed on Friday. The breach was discovered by Facebook engineers on Tuesday 25 September, the company said, and patched on Thursday. Users whose accounts were affected will be notified by Facebook. Those users will be logged out of their accounts and required to log back in. “I’m glad we found this and fixed the vulnerability,” Mark Zuckerberg said on a conference call with reporters on Friday morning. “But it definitely is an issue that this happened in the first place. I think this underscores the attacks that our community and our services face.”

The security breach is believed to be the largest in Facebook’s history and is particularly severe because the attackers stole “access tokens”, a kind of security key that allows users to stay logged into Facebook over multiple browsing sessions without entering their password every time. Possessing a token allows an attacker to take full control of the victim’s account, including logging into third-party applications that use Facebook Login. The security breach comes at a time of significant strife for the social media company, which has faced mounting criticism over issues including foreign election interference, the flow of misinformation, hate speech, and data privacy.

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I kid you not: there will be many voices labeling this as ‘opportunity’.

Melting Arctic Ice Opens New Route From Europe To East Asia (AP)

A Danish-flagged cargo ship has successfully passed through the Russian Arctic, in a trial voyage showing that melting sea ice could potentially open a new trade route from Europe to east Asia. The Venta Maersk made the journey as a one-off trial, said Palle Laursen, the chief technical officer of A.P. Moller-Maersk, the world’s biggest shipping group. The ship, carrying a cargo of frozen fish, arrived in St Petersburg on Friday, after leaving Russia’s Pacific port city of Vladivostok on 22 August. “The trial allowed us to gain exceptional operational experience,” said Laursen, adding the ship had performed well in the unfamiliar environment.

The Northern Sea route could be a shorter journey for ships travelling from east Asia to Europe than the Northwest Passage over Canada because it will likely be free of ice sooner due to climate change. Experts say it could reduce the travel distance from east Asia to Europe from the 21,000 kilometres (13,000 miles) it takes to go via the Suez Canal, to 12,800 kilometres (8,000 miles). This would cut transit time by 10 to 15 days. It’s not the first time a cargo vessel has completed the Russian Arctic route, and Maersk underlined that the journey was “to gain operational experience in a new area and to test vessel systems”. “Currently, we do not see the Northern Sea route as a viable commercial alternative to existing east-west routes,” Laursen said.

Read more …

Sep 022018
 
 September 2, 2018  Posted by at 9:16 am Finance Tagged with: , , , , , , , , , ,  


Salvador Dali Portrait of Picasso 1947

 

Is The US Economic Boom Beginning To Fizzle Out? (Coppola)
Former Eurogroup Head Dijsselbloem Says Demands On Greeks Were Too Heavy (R.)
The IMF Abetted The European Union’s Subversion Of Greek Democracy (Mody)
Ethiopia Debt Woes Curtail China Funding (R.)
May Vows No Compromise With EU On Brexit Plan (BBC)
Pentagon Cancels Aid To Pakistan Over Record On Militants (R.)
Monsanto-Bayer: Eliminating The Name Will Not Erase The Criminal History (CD)
What’s Happening To Our Weather? The Answers Are Hiding In Arctic Air (G.)

 

 

Bit short today. I think because all the focus is one two funerals I don’t care much about. In one, a bishop grabs boobs, in the other the one person not invited gets all the attention.

Is that a surprise?

Is The US Economic Boom Beginning To Fizzle Out? (Coppola)

President Trump is not going to be too happy with the New York Fed’s latest nowcast for Q3 2018. The staff projection, based upon the latest data, shows annualized quarter-on-quarter GDP growth slowing to 2% per annum. At the end of 2017 it was 4%, and even at the end of Q2 it was 3%.

The Atlanta Fed’s nowcast, which calculates GDP growth in the same way as the U.S. Bureau of Economic Analysis, also shows GDP growth slowing in Q3, though from a higher level. The Atlanta Fed’s growth estimate for Q3 is 4.1%. President Trump will no doubt be happy with this, but not so happy with the fact that at the beginning of August the estimate was 5%.

So what has gone wrong? Why are the nowcasts suggesting that U.S. economic growth is beginning to slow? The indicators that go into the NY Fed’s nowcasts have been gradually turning red for some time now. There appears to be something of a downturn going on in the housing market; both new starts and sales have fallen. Exports have fallen and imports have risen, apparently because of worsening terms of trade, most likely due to the strong dollar. Most recently, manufacturers have drawn down inventories, and there is a fall in orders and shipments for durable goods. There are no dramatic drops, but it all adds up to a gradual economic slowdown.

Read more …

How long have you realized this, Jeroen, and what have you done to repair it?

Former Eurogroup Head Dijsselbloem Says Demands On Greeks Were Too Heavy (R.)

Euro zone countries have asked for too much from the Greek people in return for international bailout loans, former Eurogroup chief Jeroen Dijsselbloem said in an interview on Dutch television on Saturday. “On reforms, we have asked a lot from the Greek people, too much,” Dijsselbloem told current affairs program Nieuwsuur. “Reforms are hard enough to accomplish in a society with a well-functioning government, but this was obviously not the case in Greece.” Greece emerged from the biggest bailout in economic history on Aug. 20, after receiving 288 billion euros in financial aid since 2010, with the European Union as its biggest lender.

During the crisis, the Greek economy shrank by a quarter, pushing a third of the population into poverty and driving thousands to move abroad. “Greece is obviously not a success story,” Dijsselbloem said. “Their crisis has been so deep, that you can’t call it a success.” Dijsselbloem chaired the Eurogroup of euro zone finance ministers from 2013 until the beginning of 2018, and led dozens of lengthy emergency meetings during which bailouts for Greece, Cyprus and the Spanish banking sector were grudgingly pieced together.

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Sister act.

The IMF Abetted The European Union’s Subversion Of Greek Democracy (Mody)

European authorities never allowed a conversation around the core imperative of reducing Greece’s debt burden. Syriza formed a government on January 25, 2015. On January 31, Erkki Liikanen, governor of Finland’s central bank and, in that capacity, a member of the ECB’s Governing Council, threatened that the ECB would stop funding Greek banks if the Greek government did not agree to the terms of the creditors. And on February 4, the ECB decided Greece’s fate. In an aggressive move that took everyone by surprise, the ECB cut off funding to Greek banks, preemptively immobilizing the Greek government before it could begin negotiations with its creditors.

The ECB withdrew an earlier arrangement under which Greek banks used their government bonds as collateral (security) to obtain funds for running their day-to-day operations. Although Greek government bonds had a junk rating and normally only higher-rated bonds qualified as collateral, the ECB had waived that requirement to help the banks stay afloat. With its February 4 decision, the ECB revoked that waiver. Greek banks could now borrow only from the Greek central bank under an Emergency Liquidity Arrangement (ELA); ELA funds carried a higher interest rate and, moreover, could be turned off at any time, thus choking the Greek financial system.

Stock prices of Greek banks fell sharply, and two days later, the rating agency S&P pushed the government bonds’ rating further into junk territory. With continuing deposit flight from Greek banks and the threat of a financial meltdown, the Syriza government rapidly lost all leverage before it could use its economic argument in a political negotiation.

Read more …

More Belt and Road.

Ethiopia Debt Woes Curtail China Funding (R.)

Ethiopia has been lauded by experts from China’s ruling Communist Party as a “model country” in Beijing’s $126 billion Belt and Road initiative to build rail, road and sea links tying China to Eurasia and Africa. But as the Horn of Africa nation of 100 million people faces debt distress, there are signs that China, a major creditor, is slowing financing to Ethiopia as doubts grow over the profitability of some infrastructure projects there. “The intensifying repayment risks from the Ethiopian government’s debt reaching 59 percent of GDP is worrying investors,” China’s mission to the African Union in Addis Ababa said on its website in July.

It said that Chinese investment in the country was cooling and that the China Export and Credit Insurance Corp was reducing the scale of its investment there. Against a backdrop of rising worry over African indebtedness to China, Prime Minister Abiy Ahmed will visit Beijing for the Forum on China-Africa Cooperation (FOCAC), which starts on Monday. He is due to meet Chinese Prime Minister Li Keqiang and is expected to court investment from Chinese firms into Ethiopia’s agro-industrial and pharmaceutical businesses, China’s Xinhua news agency said. Ethiopia has been a top destination for Chinese loans in Africa, despite its lack of natural resources, with state policy banks extending it more than $12.1 billion since 2000, according to the China Africa Research Initiative (CARI) at the Johns Hopkins School of Advanced International Studies in Washington (SAIS).

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Not your call, Theresa.

May Vows No Compromise With EU On Brexit Plan (BBC)

Theresa May has insisted she will not be forced into watering down her Brexit plan during negotiations with the EU. Writing in the Sunday Telegraph, the prime minister says she will “not be pushed” into compromises on her Chequers agreement that are not in the “national interest”. But Mrs May also warns she will not “give in” to those calling for a second referendum on the withdrawal agreement. She says it would be a “gross betrayal of our democracy and… trust”. The People’s Vote, a cross-party group including some MPs, is calling for a public vote on the final Brexit deal. The UK is on course to leave the EU on 29 March and the government had previously ruled out another referendum.

The prime minister writes that the coming months are “critical in shaping the future of our country”, but that she is “clear” about her mission in fulfilling “the democratic decision of the British people”. She adds that following the Chequers agreement in July – which led to the resignation of two cabinet ministers – “real progress” has been made in Brexit negotiations. While there is more negotiating to be done, Mrs May writes: “We want to leave with a good deal and we are confident we can reach one.” The government has been preparing for a no-deal scenario, even though this would create “real challenges for both the UK and the EU” in some sectors, she says. But the PM adds: “We would get through it and go on to thrive.”

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Just as they’ve voted in Imran Khan, who once suggested he might order the shooting down of U.S. drones if they entered Pakistani airspace, [and] has opposed the United States’ open-ended presence in Afghanistan.

Pentagon Cancels Aid To Pakistan Over Record On Militants (R.)

The U.S. military said it has made a final decision to cancel $300 million in aid to Pakistan that had been suspended over Islamabad’s perceived failure to take decisive action against militants, in a new blow to deteriorating ties. The so-called Coalition Support Funds were part of a broader suspension in aid to Pakistan announced by President Donald Trump at the start of the year, when he accused Pakistan of rewarding past assistance with “nothing but lies & deceit.” The Trump administration says Islamabad is granting safe haven to insurgents who are waging a 17-year-old war in neighboring Afghanistan, a charge Pakistan denies. But U.S. officials had held out the possibility that Pakistan could win back that support if it changed its behavior.

U.S. Defense Secretary Jim Mattis, in particular, had an opportunity to authorize $300 million in CSF funds through this summer – if he saw concrete Pakistani actions to go after insurgents. Mattis chose not to, a U.S. official told Reuters. “Due to a lack of Pakistani decisive actions in support of the South Asia Strategy the remaining $300 (million) was reprogrammed,” Pentagon spokesman Lieutenant Colonel Kone Faulkner said. Faulkner said the Pentagon aimed to spend the $300 million on “other urgent priorities” if approved by Congress. He said another $500 million in CSF was stripped by Congress from Pakistan earlier this year, to bring the total withheld to $800 million. The disclosure came ahead of an expected visit by U.S. Secretary of State Mike Pompeo and the top U.S. military officer, General Joseph Dunford, to Islamabad. Mattis told reporters on Tuesday that combating militants would be a “primary part of the discussion.”

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8,000 lawsuits. And Bayer is not a US company, big difference.

Monsanto-Bayer: Eliminating The Name Will Not Erase The Criminal History (CD)

Cancelling out Monsanto’s name and keeping only that of Bayer, does not mean forgetting the wrongdoings of a company which, according to the verdict of the Monsanto Tribunal of The Hague, is stained with crimes of ecocide. With Bayer’s official takeover of Monsanto, the giant multinational also inherits its liabilities. On the eve of the start of the integration process, Monsanto has been held liable for causing cancer through the use of its glyphosate-based weedkiller Roundup and ordered to pay $289 million of damages to the plaintiff Dewayne Lee Johnson in the first landmark case, settled in California in mid August 2018. The jury also found that Monsanto “acted with malice or oppression.”

According to Reuters, the number of lawsuits brought against Bayer’s newly acquired Monsanto is approximately 8000 in the US alone. UN experts Ms Hilal Elver, Special Rapporteur on the right to food and Mr. Dainius Puras, Special Rapporteur on the right to physical and mental health, defined the ruling “a significant recognition of the human rights of victims, and the responsibilities of chemical companies.” Revelations in reports published last year, most notably the “Monsanto Papers” and the “Poison Papers“, have shed light on strategies of big agrochemical groups to expand their empires: from lobbying, interference in government agencies’ proceedings, attacks in collusion with institutions on independent science, to mega mergers and acquisitions.

For the first time part of these documents were shown to a jury, which were able, among other things to also see that, “at least starting 20 years ago, Monsanto has known that their product can cause cancer, and has gone out of its way to ignore it and/or fight any science that suggests a link”, as declared to Democracy Now by Brent Wisner, the lead trial counsel for Dewayne Lee Johnson in his lawsuit against Monsanto. Added to this, in the same week, California’s Supreme Court rejected a challenge by Monsanto to the state’s decision to include glyphosate in its Proposition 65 list of carcinogens.

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How clean is the air?

What’s Happening To Our Weather? The Answers Are Hiding In Arctic Air (G.)

I am standing on the ocean. Ahead of me, the world is split into two perfect halves: blue sky above, white sea ice below. The view is clean and simple, but a continuous waltz of swirling and shunting is hidden inside those two colours: the inner workings of the Arctic engine. This place is special for many reasons, and to appreciate one of the most unusual all I need to do is to live; to breathe. The air is -2C, but the air coming from my lungs is invisible. The familiar wisps of cold breath that I associate with crisp winter air in Britain are absent. They cannot form here. And that anomaly is connected in a fundamental way to our presence here, on a scientific expedition to study this environment. For two months, the Swedish icebreaker Oden is home to 74 of us, living and working at the top of the world to tap into the stories that the blue and the white have to tell.

The Arctic has held on to its mystique for centuries. Many western explorers have pitted their wits, strength, and endurance against this environment, while traditional Arctic communities have learned to work with the complexities of the ice rather than against them. Those of us who live well south of the Arctic circle hear a lot about how the white in the north is changing, but less about how it is. It’s hard to construct a secondhand mental image of what it’s like here. There are no landmarks and you cannot step in the footprints of the past. This is an ocean with an icy shell that cracks and shifts as it’s pushed by the wind, breaking apart into separate floes or piling up to form ridges.

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Aug 222018
 
 August 22, 2018  Posted by at 9:36 am Finance Tagged with: , , , , , , , , ,  


Henri Matisse Laurette in a green robe 1916

Cohen Pleads Guilty, Says Violated Campaign Law At Direction Of Candidate (ZH)
Paul Manafort Found Guilty On 8 Counts, Mistrial Declared On Other Ten (ZH)
Genocide of the Greek Nation (Paul Craig Roberts)
Call For Two Years Further Freedom Of Movement After Brexit (G.)
Britain Extends Lead As King Of Currencies Despite Brexit Vote (R.)
Bank of England Chief Economist Warns On AI Jobs Threat (BBC)
Our Economic System Was Designed To Burn Everything In Its Path (NO)
The Economy of Permanent War (Connelly)
Tourists Are Destroying the Places They Love (Spiegel)
Arctic’s Strongest Sea Ice Breaks Up For First Time On Record (G.)

 

 

What comes next? Cohen’s lawyer has said he will prove collusion, which is Mueller’s mandate, but that lawyer is a bit of a shady character too.

Cohen Pleads Guilty, Says Violated Campaign Law At Direction Of Candidate (ZH)

President Donald Trump’s former personal lawyer, Michael Cohen, pleaded guilty on Tuesday to campaign finance violations and other charges, saying he made payments to influence the 2016 election at the direction of a candidate for federal office, potentially delivering a legal blow to the president. Cohen, 51, who agreed to a plea bargain with federal prosecutors earlier in the day, pleaded guilty to eight counts total, including five counts of tax evasion and one count of making a false statement to a financial institution. He also pleaded guilty to one count of making an excessive campaign contribution on Oct. 27, 2016, which is the same date Cohen finalized a payment to adult-film star Stormy Daniels as part of a nondisclosure agreement over an affair Daniels alleges she had with Trump.

The most damaging statement by Michael Cohen was made when, acknowledging the charges against him, Cohen said he was directed to violate campaign law at the direction of an unnamed candidate for federal office, whom he did not name. At the same candidate’s direction, Cohen said he paid $130,000 in violation of campaign finance laws to “somebody” to keep them quiet, which was later repaid by the candidate. He said he arranged to make payments “for (the) principal purpose of influencing (the) election” at the direction of a candidate for federal office; Cohen did not give the candidate’s name, but those facts match Cohen’s payment to Clifford and Trump’s repayment. Cohen’s exact words: “I have donated the money that was in the account in coordination with and at the direction of a federal candidate.”

Cohen also tells the federal court he evaded substantial taxes on his income, with Bloomberg noting that the sentencing guideline calls for 46 to 63 months in prison. The prosecutor told the judge the purpose of the payments was to ensure that the individuals did not disclose “alleged affairs with the candidate.” Besides the $130,000 payment, Cohen admitted to making an illegal contribution of $150,000, which was how much McDougal received from the National Enquirer’s publisher to quash her story. As Bloomberg explicitly adds, “at no time was the candidate’s name mentioned.” The prosecutor also said Cohen failed to report $4 million on taxes and lied about debts and banking details on loan applications.

His voice cracked as he answered questions from Judge William Pauley III. As Bloomberg notes, Cohen was shaking head and appeared to be holding back emotions as judge reviews possible sentence. Cohen faces a likely prison sentence of 46 to 63 months, the judge said.

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A mover and a shaker. Can’t help thinking we’re reading a real bad novel. Can’t wait for the movie.

Paul Manafort Found Guilty On 8 Counts, Mistrial Declared On Other Ten (ZH)

Jurors in the trial of former Paul Manafort have reached a verdict on eight of the 18 counts against the former Trump aide. After a day of passing notes to the Judge, they said they were unable to reach a decision on the other 10. Manafort was found guilty on all five tax fraud counts, while the other three are related to his failure to disclose foreign bank accounts and bank fraud. The verdict comes at the end of two and a half weeks of testimony, which included 27 witnesses and 88 documents submitted into evidence. Earlier, the jury asked Judge T.S. Ellis earlier in the day what would happen if they couldn’t reach a verdict on a count, and Ellis told them to keep working on it.

“If we cannot come to a consensus for a single count, how can we fill in the verdict sheet?” the jurors asked in the note. “It is your duty to agree upon a verdict if you can do so,” said Ellis, who encouraged each juror to make their own decisions on each count. If some were in the minority on a decision, however, they could think about the other jurors’ conclusions. Give “deference” to each other and “listen to each others’ arguments,” said Ellis, adding “You’re the exclusive judges … Take all the time which you feel is necessary.” Manafort stands accused of 18 counts of tax evasion, bank fraud and obfuscating foreign bank counts in the first trial brought against him by special counsel Robert Mueller as part of his investigation into Russian meddling in the 2016 election – despite the charges stemming from his work for the then-Ukrainian governing party.

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“The declaration that the Greek crisis is over is merely a statement that there is nothing left to extract from the Greek people for the interest of the foreign banks.”

Genocide of the Greek Nation (Paul Craig Roberts)

Traditionally, when a sovereign country, whether by corruption, mismanagement, bad luck, or unexpected events, found itself unable to repay its debts, the country’s creditors wrote down the debts to the level that the indebted country could service. With Greece there was a game change. The ECB, led by Jean-Claude Trichet, and the IMF ruled that Greece had to pay the full amount of interest and principal on its government bonds held by German, Dutch, French, and Italian banks. How was this to be achieved? In two ways, both of which greatly worsened the crisis, leaving Greece today in a far worst position that it was in at the beginning of the crisis almost a decade ago.

At the beginning of the “crisis,” which would have easily been resolved by writing down part of the debt, the Greek debt was 129% of Greek GDP. Today Greek debt is 180% of GDP. Why? Greece was lent more money to pay interest to Greece’s creditors, so that they would not have to lose one cent. The additonal lending, called a “bailout” by the presstitute financial media, was not a bailout of Greece. It was a bailout of Greece’s creditors. The Obama regime encouraged this bailout, because the American banks, expecting a bailout, had sold credit default swaps on Greek debt. Without a bailout the US banks would have lost their bet and paid default insurance on Greek Bonds.

Additionally, Greece was required to sell its public assets to foreigners and to decimate the Greek social safety net, reducing pensions, for example, to below subsistance incomes and so radically reducing medical care that people die before they can get treatment. If memory serves, China bought the Greek seaports. Germay bought the airport. Various German and European entities bought the Greek municipal water companies. Real estate speculators bought protected Greek Islands for real estate development. This plunder of Greek public property did not go toward reducing the debt that Greek owed. It went, along with the new loans, to paying the interest. The debt, larger than ever, still stands. The economy is smaller than ever as is the Greek population that bears the debt.

The declaration that the Greek crisis is over is merely a statement that there is nothing left to extract from the Greek people for the interest of the foreign banks. Greece is sinking fast. All of the income associated with sea ports, airport, municipal utilities, and the rest of public property that was forcibly privatized now belongs to foreigners who take the money out of the country, thus further driving down the Greek economy.

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Shifting goal posts, rearranging deck chairs.

Call For Two Years Further Freedom Of Movement After Brexit (G.)

Britain would face labour shortages in London and the south-east from a no-deal Brexit, according to a report calling for the government to extend freedom of movement for EU migrants to protect the wider economy. The Centre for Cities thinktank urged the government to extend freedom of movement for two years after the UK leaves the EU on 29 March 2019, in the event of no deal on the terms of exit and future relations with the union. Publishing a report on EU citizens working in British towns and cities across the country, the Centre for Cities warned cities such as Oxford, Cambridge and London, where the vote was in favour of remaining in the EU, are reliant on EU migrants, making them particularly vulnerable to tougher immigration rules should Britain crash out without a deal.

The report said about one in 10 employees in major southern cities were from the EU. It said they had brought with them “significant economic benefits” to the wider British economy, which could be put at risk from a no-deal Brexit. Andrew Carter, chief executive of Centre for Cities, said: “[The government] should continue to allow EU migrants to come and work in UK cities for at least the next two years, even if there is no Brexit deal in place. This will be crucial in helping cities avoid a cliff edge in terms of recruiting the workers they need.” The report comes ahead of the government’s publication of a series of technical notices detailing the impact of a no-deal Brexit.

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How far removed the City is from the country.

Britain Extends Lead As King Of Currencies Despite Brexit Vote (R.)

Britain has extended its lead in the global currency trading business in the two years since it voted to leave the European Union, in another sign London is likely to continue to be one of the world’s top two financial centres even after Brexit. Leaving the European Union was supposed to deal a crippling blow to London’s position in global finance, prompting a mass exodus of jobs and business. But with eight months to go, London has tightened rather than weakened its grip on foreign exchange trading, a Reuters analysis shows. Foreign exchange – the largest and most interconnected of global markets, used by everyone from global airlines to money managers in transactions worth trillions of dollars a day – is the crowning jewel of London’s financial services industry.

Reuters’ analysis, based on surveys released by central banks in the five biggest trading centres, shows forex trading volumes in Britain had grown by 23 percent to a record daily average of $2.7 trillion (£2.1 trillion) in April compared to April 2016. That was double the pace of its nearest rival, the United States, which was up 11 percent to $994 billion, mostly out of New York. That means about two-fifths of all trades are handled in Britain, nearly all of them in London – a daily volume almost equivalent to the annual economic output of the United Kingdom. The next three biggest markets are Singapore, which fell by 5 percent to $523 billion; Hong Kong, which grew 10 percent to $482 billion; and Japan, which increased by 2 percent to $415 billion.

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Time for a new Karl Marx?!

Bank of England Chief Economist Warns On AI Jobs Threat (BBC)

The chief economist of the Bank of England has warned that the UK will need a skills revolution to avoid “large swathes” of people becoming “technologically unemployed” as artificial intelligence makes many jobs obsolete. Andy Haldane said the possible disruption of what is known as the Fourth Industrial Revolution could be “on a much greater scale” than anything felt during the First Industrial Revolution of the Victorian era. He said that he had seen a widespread “hollowing out” of the jobs market, rising inequality, social tension and many people struggling to make a living. It was important to learn the “lessons of history”, he argued, and ensure that people were given the training to take advantage of the new jobs that would become available.

He added that in the past a safety net such as new welfare benefits had also been provided. Mr Haldane’s points were echoed by the new head of the government’s advisory council on artificial intelligence, who also warned there was a “huge risk” of people being left behind as computers and robots changed the world of work. Tabitha Goldstaub, chair of the newly formed Artificial Intelligence Council, said that the challenge was ensuring that people were ready for change and that the focus was on creating the new jobs of the future to replace those that would disappear. “Each of those [industrial revolutions] had a wrenching and lengthy impact on the jobs market, on the lives and livelihoods of large swathes of society,” Mr Haldane told me for the Today Programme.

“Jobs were effectively taken by machines of various types, there was a hollowing out of the jobs market, and that left a lot of people for a lengthy period out of work and struggling to make a living. “That heightened social tensions, it heightened financial tensions, it led to a rise in inequality. “This is the dark side of technological revolutions and that dark-side has always been there. “That hollowing out is going to be potentially on a much greater scale in the future, when we have machines both thinking and doing – replacing both the cognitive and the technical skills of humans.”

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“The shocks to our current system that arrive early are better than the ones that come too late.”

Our Economic System Was Designed To Burn Everything In Its Path (NO)

Boom and bust cycles in the extraction economy have always brought incredible destruction and pain, especially to those closest to the land. Not by accident but by design – billions of dollars of wealth has been stripped from the land for the benefit of mostly outside investors who never intended a long term sustainable plan for rural or Indigenous communities, much less the ecosystems they rely on. But with accelerating climate change, we now have boom, bust and burn (this burn has many forms, fire is just one). And it affects everyone. The truth is this economic system has always been on fire. The terrifying object at the end of the extraction economy is the devastating and total incineration of almost everything we know and love.

This is the only endgame in the extraction economy — it is what happens when a model dependent on infinite growth is played out on a planet with finite resources. The extraction economy is an extinction economy, or maybe more accurately an extinction machine. It has always burnt everything in its path. That is what it’s designed to do. The people and living things on the periphery have always felt it first. But now in a world of global climate disruption, the match has burned down to our fingers. There is no periphery and no centre. Just one interconnected and interdependent world – on fire, together. It is not a bad thing to see this laid bare. We need new models for a sustainable civilization, and this will be a big lift that will require change at every level of social organization. The shocks to our current system that arrive early are better than the ones that come too late.

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Free trade requires permanent war.

The Economy of Permanent War (Connelly)

Dr Kadri says that free trade is ‘a poisonous concept’ that requires a state of permanent war. “In way we are caught in a catch-22 situation,” he says. “War is awful, but it does wonders for the macroeconomy.” “One need only look at what has occurred in Yemen, Gaza, Libya, Syria, Afghanistan and Iraq to discover the new shape of war and what happens to countries that attempt to control their own resources in an age where war and war spending have become all the more necessary to take the market out of its slump.” Syria’s GDP was $73 billion in 2012, a 73% decrease in economic output from 2008, according to Statista. Cumulative GDP loss between 2011–2016 is estimated at $226 billion, according to the World Bank.

“Why would the US be interested in billion dollar trade, when it has made more than a trillion out of war in Syria?,” he says. “If you want cash in against the Syrian government, you spend a trillion dollars mobilising intelligence in the west, another couple of trillion sowing dissent, saying Syria is bad, we have a bad guy in power, we should kill him and free this country, maybe bring in ISIS, al-Qaeda or some other obscurantist group. They’re willing to pay even tens of trillions, because they will earn back every penny.” “If they spend ten trillion on this war, they’re going to earn $10–20 trillion back,” he says.

[..] The former UN economist says that free trade basically dislocates resources and never re-employs them back. “It either drives resources out of business, or it simply destroys them,” he says. “If you force governments in sub-Saharan Africa or the Middle East to subsidise their agriculture, while the EU, for instance, spends a trillion euros a year subsidising its agriculture, you already have an economic imbalance in the way policy occurs.” In many cases, war is actually more profitable than trade.

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Make every single part of the travel industry pay for the destruction it causes.

Tourists Are Destroying the Places They Love (Spiegel)

It’s not just Europeans exploring each others’ countries. The boom is also fueled by people from countries that have benefited handsomely from globalization. Much of the responsibility for the growth in global tourism lies with members of the newly emerging middle classes in Russia and with people from the Far East and Arab countries. They also bear a significant share of the responsibility for the growing problems. The boom, after all, is also producing losers, and many of them have begun revolting, as recently seen in the pilot strikes at European budget carrier Ryanair, whose poor working conditions and low wages are what make the airline’s low-cost strategy possible in the first place.

But residents of the cities and regions affected are perhaps the biggest losers. When, for example, it becomes more lucrative for property owners to rent their apartments out to tourists on a daily or weekly basis than to locals who need an affordable place to live. Or when commuters have to squeeze into overcrowded public transportation because local buses and trains have been filled to capacity by tourists. Or when people no longer feel comfortable in their neighborhood because they have become a minority in the cafés and restaurants they traditionally frequented. That is, assuming they can get in at all or afford the new prices.

The tourism industry suddenly finds itself confronted by a group that it hadn’t previously paid much attention to. Having always focused on the guests, it tended to overlook the hosts. “Tourism is a phenomenon that creates many private profits but also many socialized losses,” says Christian Laesser, a tourism professor at the University of St. Gallen in Switzerland. Often, the profits benefit very few – the landlords and hotel owners primarily, but also, to a much lesser extent, the often poorly paid employees working in the travel sector. The rest are stuck with the noise and the mess, the high rents and the feeling of being a stranger in their own country, like being an extra in some Disney World for tourists.

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The last ice area. That sounds ominous.

Arctic’s Strongest Sea Ice Breaks Up For First Time On Record (G.)

The oldest and thickest sea ice in the Arctic has started to break up, opening waters north of Greenland that are normally frozen, even in summer. This phenomenon – which has never been recorded before – has occurred twice this year due to warm winds and a climate-change driven heatwave in the northern hemisphere. One meteorologist described the loss of ice as “scary”. Others said it could force scientists to revise their theories about which part of the Arctic will withstand warming the longest. The sea off the north coast of Greenland is normally so frozen that it was referred to, until recently, as “the last ice area” because it was assumed that this would be the final northern holdout against the melting effects of a hotter planet.

But abnormal temperature spikes in February and earlier this month have left it vulnerable to winds, which have pushed the ice further away from the coast than at any time since satellite records began in the 1970s. “Almost all of the ice to the north of Greenland is quite shattered and broken up and therefore more mobile,” said Ruth Mottram of the Danish Meteorological Institute. “Open water off the north coast of Greenland is unusual. This area has often been called ‘the last ice area’ as it has been suggested that the last perennial sea ice in the Arctic will occur here. The events of the last week suggest that, actually, the last ice area may be further west.”

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Apr 252018
 
 April 25, 2018  Posted by at 8:27 am Finance Tagged with: , , , , , , , , , ,  


Amedeo Modigliani Nu allongé 1917

 

Why All Companies Fear ‘Death By Amazon’ (G.)
Richmond Fed Manufacturing Survey Crashes By Most In 25 Years (ZH)
Markets Better Prepare for Stagflation (DDMB)
Trade War With US And China’s $14 Trillion Debt-Ridden Economy (CNBC)
Big Farms Set To Pay The Price As EU Eyes Subsidy Cuts (Pol.)
In Japan, New Rules May Leave Home-Sharing Industry Out In The Cold (R.)
Palma de Mallorca To Ban Holiday Rentals After Residents’ Complaints (BBC)
Greece Uncovers Tax Evading Airbnb Owners By Posing as Customers (KTG)
World Wine Output Falls To 60-Year Low (R.)
Homelessness In UK ’10 Times Worse’ Than Official Figures Suggest (Ind.)
Over One In Five Greeks Can’t Make Ends Meet (K.)
Greek Minister Drafts Action Plans Amid Fears Over Refugee Influx (K.)
Greek Government Defies Court on Asylum Seekers (HRW)
Arctic Sea Ice Contains Huge Quantity Of Microplastics (Ind.)

 

 

Do we want monopolies? We’re letting them grow in front of our eyes.

Why All Companies Fear ‘Death By Amazon’ (G.)

Although its retail site is the most visible of its business strands, the $740bn company has quietly stretched its tentacles into an astonishing range of unrelated industries. Google and Facebook might have cornered the online advertising market, but Amazon’s business successes now include groceries, TV, robotics, cloud services and consumer electronics. “If you try to measure power by how many executives are up at night because of X company, I think Amazon would win,” said Lina Khan, legal fellow with the Open Markets Program at the thinktank New America. Amazon has a restaurant delivery service, a music streaming service and an Etsy clone called Amazon Homemade. It makes hugely successful hardware and software; it makes movies, television shows and video games.

It runs a labour brokerage for computer-based work and another for manual labour. It publishes books, sells books, and owns the popular social network site for book readers GoodReads.com. It sells diapers, baby food, snacks, clothing, furniture and batteries. It sells ads, processes payments, and makes small loans. It is the unexpected owner of a huge number of websites – everything from the gaming livestream site Twitch to the movie database IMDb. Of the top 10 US industries by GDP (information, manufacturing non-durable goods, retail trade, wholesale trade, manufacturing durable goods, healthcare, finance and insurance, state and local government, professional and business services, and real estate), Amazon has a finger in all but real estate.

And how confident can the real estate industry be right now that Amazon won’t at some point decide to allow people to buy and sell homes on its platform? “I see them as kind of a great white shark,” said Greer. “You don’t really want to mess with them.” “It’s basically become a railroad for the 21st century,” added Khan. “It’s existential for so many businesses but also competing with all those businesses.” What makes Amazon so frightening for rival businesses is that it can use its expertise in data analytics to move into almost any sector. “Amazon has all this data available. They track what people are searching for, what they click, what they don’t,” said Greer. “Every time you’re searching for something and don’t click, you’re telling Amazon that there’s a gap.”

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Recovery.

Richmond Fed Manufacturing Survey Crashes By Most In 25 Years (ZH)

When hope dies… against expectations of a small rise from March to a 16 print, April came in at a disastrous -3 (the worst data since Sept 2016). From record highs just a couple months ago, Richmond Fed manufacturing has crashed by the most in the survey’s 25 year history into contraction…

It was a bloodbath below the surface too. New orders collapsed to -9 from +17, order backlogs plunged to -4 from +10 and while wages and employees rose, workweek dropped notably. Finally, prices paid rose once again even as new orders crashed… Must be the weather, right?

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No, inflation is not “heating up by all metrics”. But we get the point.

Markets Better Prepare for Stagflation (DDMB)

Investors better wake up to the growing risk of stagflation. The coming weeks promise to deliver the verdict on how they should be positioned. By all metrics, inflation is heating up. But it’s not clear the same can said for underlying economic activity. According to producers, input costs have risen for six of the past eight months. And it’s not just big companies that are feeling pressure. One in four small businesses say they plan to raise prices, a 10-year high, according to the National Federation of Independent Business. Inflation’s persistence will finally begin to trickle through to consumers.

David Rosenberg, chief economist at the wealth management company Gluskin Sheff, recently quipped that investors “better say a prayer for Jay Powell,” the Federal Reserve chair. The deniers will dismiss the suggestion. But Rosenberg is serious, citing the core consumer price index’s March leap to 2.1%, a level that breaches the Fed’s 2% inflation target. “There is going to be a price to be paid for last year’s string of wireless-induced 0.1% prints which are falling out of the year-over-year math,” Rosenberg explained, referring to the collapse in wireless services that skewed inflation lower in 2017. “I see 50/50 odds of a 3% core inflation by year end.”

[..] The New York Fed’s regional survey also raised red flags. Delivery Times remained near their highest levels in seven years while New Orders, Backlogs and Employment all declined. The survey showed an even gloomier outlook for the future. The six-month business activity outlook dove to 18.8 from 44.1, the weakest since February 2016. Though one month can never make a trend, the depth of the plunge is bound to have raised eyebrows given that prior moves of its magnitude tend to coincide with recession.

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China’s so bloated with debt it is very vulnerable.

Trade War With US And China’s $14 Trillion Debt-Ridden Economy (CNBC)

While some of the rhetoric around trade tariffs on China has died down over the last couple of weeks, the prospect of a trade war has not. On April 18, China imposed preliminary antidumping tariffs of 178.6% on sorghum, a crop used to make alcohol and biofuels, while President Donald Trump’s threat to impose tariffs on $150 billion worth of goods on everything from solar panels to aircraft to cars remains on the table. If an actual U.S. trade war ensues, then China’s economic growth prospects could be negatively impacted in a significant way. While the country’s economy has shifted inward over the last few years, relying on its own citizens to fuel growth, it still exports billions of dollars in goods and services every year.

Last year it sold $506 billion in exports to the United States — nearly 20% of its exports go to America — while the United States sold just $130 billion to the Chinese. In January the IMF said China’s economic growth would top 6.6% in 2018, but it could now drop by as much as 0.5% if these tariffs are imposed — and it could slow even further if a global trade war truly heats up. China’s economy can likely weather a small decline in growth, in part because of its increased reliance on domestic spending, but this isn’t the only potentially GDP-destroying situation it’s dealing with.

Over the last few years, China’s debt-to-GDP has ballooned to more than 300% from 160% a decade ago, causing many people, including Chinese officials, to warn of a financial-sector debt bubble that’s waiting to burst. [..] How did it get so bad? After the recession, the country spent trillions on infrastructure projects, with many banks, including unregulated or “shadow” banks, loaning money to companies that have been unable to pay back their debts. According to a Chinese news outlet, Lai Xiaoming, chairman of China Huarong Asset Management, one of the country’s biggest asset management firms, said that total volume of nonperforming loans could hit a record $476 billion by 2020.

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Why the insects are dying. Europe should cut subsidies for anyone using chemicals.

Big Farms Set To Pay The Price As EU Eyes Subsidy Cuts (Pol.)

EU Budget Commissioner Günther Oettinger said Monday that Brussels plans to cut its payments to Europe’s biggest farms in the next budget cycle in order to reduce the bloc’s lavish agricultural subsidies by 6%. Brussels is due to make a proposal for the EU’s 2021-2027 budget framework on May 2, and cutbacks are seen as inevitable because Britain will no longer be contributing funds. Agricultural spending is one of the most obvious targets for cost cutting because the Common Agricultural Policy represents almost 40% of the EU budget, or some €59 billion each year.

When asked by POLITICO about CAP cuts on the sidelines of a trade conference in Hannover, Oettinger said: “We cannot fully exempt the existing programs from cutbacks. And in comparison to 2020, as the last year of the existing financial framework, my proposal will focus on approximately 6%, a moderate 6%, reductions.” One of the biggest criticisms of the CAP is that it has prioritized big landowners with direct payments based on acreage. Some 80% of CAP funds go to 20% of farms, owned by the likes of British royalty and major multinational companies. Oettinger said the new budget model would aim to balance that slightly.

“What we have in mind is degressive funding: That means a very big business receives for its hectares a little bit less money than a small enterprise. And that’s exactly what we still have to discuss within the next next days. On Wednesday, we will have a discussion between [Agriculture Commissioner Phil] Hogan and me on this.” Hogan has already told farmers to prepare for belt-tightening. “We need to be realistic: In the absence of more money from member states, there will be a cut to the CAP budget. My job as I see it is to build the strongest possible coalition to resist the worst of these cuts, and achieve the best outcome in a difficult scenario,” he said last week.

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Governments are starting to tackle Airbnb.

In Japan, New Rules May Leave Home-Sharing Industry Out In The Cold (R.)

Japan’s new home-sharing law was meant to ease a shortage of hotel rooms, bring order to an unregulated market and offer more lodging options for foreign visitors ahead of next year’s Rugby World Cup and the 2020 Tokyo Olympics. Instead, the law is likely to stifle Airbnb Inc and other home-sharing businesses when it is enacted in June and force many homeowners to stop offering their services, renters and experts say. The “minpaku,” or private temporary lodging law, the first national legal framework for short-term home rental in Asia, limits home-sharing to 180 days a year, a cap some hosts say makes it difficult to turn a profit.

More important, local governments, which have final authority to regulate services in their areas, are imposing even more severe restrictions, citing security or noise concerns. For example, Tokyo’s Chuo ward, home to the tony Ginza shopping district, has banned weekday rentals on grounds that allowing strangers into apartment buildings during the week could be unsafe. That’s a huge disappointment for Airbnb “superhost” Mika, who asked that her last name not be used because home-renting is now officially allowed only in certain zones. She has enjoyed hosting international visitors in her spare two-bedroom apartment but will stop because her building management has decided to ban the service ahead of the law’s enactment.

“I was able to meet many different people I would have not met otherwise,” said Mika, 53, who started renting out her apartment after she used a home-sharing service overseas. “I may sell my condo.” Mika added that if she were to rent the apartment out on a monthly basis, she would only make one-third of what she does from short-term rentals. The ancient capital of Kyoto, which draws more than 50 million tourists a year, will allow private lodging in residential areas only between Jan. 15 and March 16, avoiding the popular spring and fall tourist seasons.

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“..only 645 of 11,000 holiday rentals being offered to tourists on Palma have the licence required to do so.”

Palma de Mallorca To Ban Holiday Rentals After Residents’ Complaints (BBC)

The Spanish resort city of Palma, on the island of Majorca, is to ban flat owners from renting their apartments to travellers, becoming the first place in Spain to introduce such a measure. The restrictions follow complaints from residents of rising rents due to short holiday lets through websites and apps. Palma’s mayor says the ban, to be introduced in July, will be a model for cities suffering with mass tourism. But business associations say many families will be financially impacted. It was not immediately clear if the ban was restricted only to private flats advertised by their owners on apps or websites.

Houses and chalets will be exempt from the restrictions unless they are located inside protected areas, next to the airport or in industrial zones. Palma, like many other cities around the world, has seen an increase in visitor numbers driven, in part, by private rental accommodation offered through websites and apps. Officials from the local left-wing governing coalition cited a study suggesting that the number of non-licensed apartments on offer to tourists increased by 50% between 2015 and 2017. According to Spanish newspaper El País, only 645 of 11,000 holiday rentals being offered to tourists on Palma have the licence required to do so.

Locally, there is resentment over tourism pushing up prices – rents in Palma have reportedly increased 40% since 2013 – but also about deteriorating conditions in neighbourhoods popular with travellers due to noise and bad behaviour. “Palma is a determined and courageous city,” Mayor Antoni Noguera said. “We agreed on this [ban] based on the general interest [of the city] and we believe it will set the trend for other cities when they see that finding a balance is key.”

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They’re all doing it all wrong. Simply force Airbnb to supply numbers on all rentals.

Greece Uncovers Tax Evading Airbnb Owners By Posing as Customers (KTG)

Tax inspectors uncover tax evading Airbnb owners by pretending to be customers. According to Greece’s Independent Authority for Public Revenue (AADE), the trap has revealed a total of 55 Airbnbn tax evaders, so far. In some cases, the ‘fake customers’ even proceeded to booking an Airbnb flat. The first Airbnb owners who failed to declare their earnings from home-sharing practices were uncovered by Greece’s Independent Authority for Public Revenue (AADE) this week. Under a pilot program aiming to weed out violators, AADE inspectors posed as customers seeking to rent out short-term accommodation via the Airbnb platform. The undercover inspections focused on central points in the Greek capital as well as on luxury options available on popular Greek islands. In some cases, AADE authorities even proceeded to book.

According to AADE, 55 proprietors who had not proceeded with the mandatory declaration of earnings from home-sharing services were notified of the violation. A total of 39 came forward and proceeded with corrections to their income tax declarations indicating additional property income of approximately 921,163 euros resulting in over 200,000 euros going into state coffers. It should be noted that all owners renting out their properties on home-sharing platforms are required by Greek law to declare earned incomes from short-term lease in 2017 on their E2 Forms (column 7).

For income up to 12,000 euros, tax is imposed at a rate of 15%. Takings between 12,001 and 35,000 euros will be taxed at a 35% rate; annual gains over 35,000 euros at a 45% rate. For those offering additional services on the side, the earnings are assessed as income from business activity and taxed at 22% for earnings up to 20,000 euros, 29% for yields between 20,001 and 30,000 euros, 37% for takings between 30,001 and 40,000 euros, and 45% for profits exceeding 40,000 euros.

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Looked it up: World population 60 years ago was less than 3 billion (it hit that in 1960). It is now 7.5 billion. Ergo: people used to drink over 2x as much wine back then.

World Wine Output Falls To 60-Year Low (R.)

Wine production totaled 250 million hectoliters last year, down 8.6% from 2016, data from the Paris-based International Organisation of Vine and Wine (OIV) released on Tuesday showed. It is the lowest level since 1957, when it had fallen to 173.8 million hectoliters, the OIV told Reuters. A hectoliter represents 100 liters, or the equivalent of just over 133 standard 75 cl wine bottles. All top wine producers in the EU have been hit by harsh weather last year, which lead to an overall fall in the bloc of 14.6% to 141 million hectoliters.

The OIV’s projections, which exclude juice and must (new wine), put Italian wine production down 17% at 42.5 million hectoliters, French output down 19% at 36.7 million and Spanish production down 20% at 32.1 million. The French government said last year production had hit a record low due to a series of poor weather conditions including spring frosts, drought and storms that affected most of the main growing regions including Bordeaux and Champagne. In contrast, production remained nearly stable in the United States, the world’s fourth largest producer, and China, which has become the world’s seventh largest wine producer behind Australia and Argentina.

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Failed state.

Homelessness In UK ’10 Times Worse’ Than Official Figures Suggest (Ind.)

The true scale of homelessness in the UK is almost 10 times worse than official figures suggest, according to a new report. Homeless charity Justlife warns thousands of people are being “forgotten in statistics” after it estimated that at least 51,500 people were living in B&Bs in the year to April 2016 – compared with 5,870 official B&B placements recorded by the government. It comes after a separate investigation found that 78 homeless people died last winter – an average of at least two a week. The report by the Bureau of Investigative Journalism revealed the fatalities included rough sleepers, people recognised as “statutory homeless” and people staying in temporary accommodation.

Justlife reached its estimate on the homeless B&B population using data gathered from Freedom of Information requests to local authorities, along with other information from the government’s Rural and Urban Classification for Local Authority Districts data. Christa Maciver, author of the report, said: “We can no longer ignore the tens of thousands of people stuck homeless, hidden and ignored in our cities. This report shows there is so much we don’t know and that we really need to be calculating homelessness more accurately.

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And another failed state.

Over One In Five Greeks Can’t Make Ends Meet (K.)

Last year 21.1% of Greeks – or more than one in five – were unable to cover their basic needs, such as the timely payment of utility bills and regular consumption of meat, according to Eurostat. That 21.1% in 2017 may constitute a minor improvement from the 22.4% rate in 2016, but is still a particularly high level. This rate was also the second highest in the European Union and translates to a large share of the population, or 2.24 million people.

The people or households in that category are by definition those unable to meet the costs of at least four of the following: payment of utility bills in time, sufficient heating at home, tackling extraordinary expenses, consumption of meat (or fish or the equivalent in vegetables) on a regular basis, a one-week vacation away from home, and capacity to purchase a TV set, a washing machine, a car or a telephone. The age group with the highest rate of material deprivation in Greece includes those between 20 and 24 years, amounting to 32.6% – or one in three – though this is according to 2016 data. Notably, the year with the highest material deprivation rate in Greece from 2003 to 2017 (for which Eurostat has data), was 2009.

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Arrivals on Lesbos are 4 times what they were last year this time.

Greek Minister Drafts Action Plans Amid Fears Over Refugee Influx (K.)

Migration Minister Dimitris Vitsas conceded on Tuesday that he is “worried” about the significant increase in the flow of migrants and refugees to Greece observed recently. Vitsas said that arrivals on Lesvos had increased almost fourfold since last year, noting that daily arrivals were 54 on average last year compared to the 206 migrants who arrived on the island on Tuesday. Between January and April, more than 7,000 migrants and refugees arrived on the islands of the eastern Aegean, he said, noting that just 112 people were returned to Turkey during that same period. However, Vitsas appeared far more concerned with the increase in arrivals over the Greek-Turkish land border, noting that 340 people crossed the border on Tuesday.

“I’m not scared about the islands because we know what we have to do. What is really worrisome is the huge increase through Evros,” he said. Under pressure from the opposition over mistakes and omissions in the government’s current migration policy, Vitsas said that his ministry has prepared two plans to deal with the situation and pledged to outline their content to political party leaders in private. According to Bulgarian government statistics, 356 migrants have crossed into that country from Turkey since the beginning of the year. In the same period, more than 2,700 crossed Turkey’s land border with Greece, Vitsas said.

There are fears that the difference in flows is due to deteriorating ties between Greece and Turkey while relations between Sofia and Ankara are good, particularly since Bulgarian authorities returned alleged supporters of the US-exiled Turkish cleric Fethullah Gulen to Turkey in 2016. Security along Turkey’s border with Bulgaria has intensified since then. The opposite has been happening along the Greek border since the detention of two Greek soldiers who strayed across the border in early March. Greek border guards are now more cautious, and less inclined to crack down on migrants.

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Curious. Athens should be open about EU pressure on the topic.

Greek Government Defies Court on Asylum Seekers (HRW)

The Greek government’s move on April 20, 2018, overturning a binding court ruling ordering it to end its abusive policy of trapping asylum seekers on Greece’s islands raises rule of law concerns, 21 human rights and humanitarian organizations said today. Rather than carrying out the April 17 ruling by the Council of State, the country’s highest administrative court, the government issued an administrative decision reinstating the policy, known as the “containment policy.” It also introduced a bill on April 19 to clear the way to restore the policy in Greek law. Parliament members should oppose such changes and press the government to respect the ruling.

Parliament began discussing the draft law on April 24. But the government has preempted the debate on the bill, including the issue of the containment policy by reinstating it. On April 20, the new director of the asylum service reissued an administrative order setting down the reasons for the containment policy. Among grounds given to justify the restrictions imposed by the policy are the need to implement an EU-Turkey deal on migration and a broader public interest claim. But the decision goes against the Council of State ruling and Greece’s responsibilities under international, EU and Greek law, as it offers insufficient justification for the restrictions, the groups said.

The Council of State’s April 17 ruling said that Greece’s containment policy had no legal basis and that there were no imperative reasons under EU and Greek law justifying the restrictions to the freedom of movement of asylum seekers. It ordered the annulment of the administrative decision imposing the restrictions and permitted the free movement of asylum seekers arriving on the islands following the ruling’s publication. The ruling also highlighted that the disproportionate distribution of asylum seekers has overburdened the islands. The ruling is limited, however, applying only to new arrivals.

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“Each litre of sea ice contained around 12,000 particles of plastic..”

Arctic Sea Ice Contains Huge Quantity Of Microplastics (Ind.)

Scientists have found an unprecedented number of microplastics frozen in Arctic sea ice, demonstrating the alarming extent to which they are pervading marine environments. Analysis of ice cores from across the region found levels of the pollution were up to three times higher than previously thought. Each litre of sea ice contained around 12,000 particles of plastic, which scientists are now concerned are being ingested by native animals. Based on their analysis, the researchers were even able to trace the tiny fragments’ paths from their places of origin, from fishing vessels in Siberia to everyday detritus that had accumulated in the infamous Great Pacific Garbage Patch.

“We are seeing a clear human imprint in the Arctic,” the study’s first author, Dr Ilka Peeken, told The Independent. “It suggests that microplastics are now ubiquitous within the surface waters of the world’s ocean,” said Dr Jeremy Wilkinson, a sea ice physicist at the British Antarctic Survey who was not involved with the study. “Nowhere is immune.”

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Mar 072018
 
 March 7, 2018  Posted by at 10:46 am Finance Tagged with: , , , , , , , , , , ,  


Lewis Wickes Hine Italian family in the baggage room, Ellis Island, New York 1905

 

Currency Investors Are Bracing for a Full-Blown Trade War (BBG)
Trump Sticks With Tariff Plan, Warns EU On Trade (R.)
Europe Renews Tariffs On Chinese Steel Pipes As High As 72% (ZH)
US Considers Broad Curbs on Chinese Imports, Takeovers (BBG)
With Cohn Gone, Peter Navarro Is Unleashed At White House (CNBC)
It’s Not Bad Trade Deals, It’s Bad Money – Part 2 (Stockman)
China Dramatically Boosts Spending On Internal Security (WSJ)
Greater Toronto Home Sales Down 35% From February 2017 (CBC)
Italy’s Populists Split The Country in Half (BBG)
In The Alps, Traffickers Prey On Migrants And Rescuers Alike (AFP)
Europe’s Recurring Financial Crisis Has Not, Repeat, Not Ended (F.)
New Eurogroup Chief Warns Of Greek Vulnerability (K.)
Why Turkey Wants to Invade the Greek Islands (Bulut)
Arctic Has Warmest Winter On Record (AP)

 

 

For now, I doubt it.

Currency Investors Are Bracing for a Full-Blown Trade War (BBG)

In foreign-exchange markets, investors aren’t waiting to find out if all the tariff threats being thrown around lead to a full-blown trade war. Some money managers have begun piling into traditional havens like the yen; others are trimming currency exposure altogether; and even those who’re betting not much will come from the row are hedging just in case. The concern is that Trump’s plan to impose steel and aluminum tariffs will trigger a wave of retaliatory levies that derail the worldwide economic expansion. The EU has already responded, preparing punitive steps on iconic U.S. goods should Trump go through with his threats.

Gary Cohn’s resignation Tuesday drove home investors’ skittishness: the yen surged, while the peso and Canadian dollar sank. “Currencies can be very small but sharp objects, where a little exposure can have a large impact,” said Gene Tannuzzo, a portfolio manager at Columbia Threadneedle Investments. “So you could see more and more managers just not really stick their neck out as it relates to FX exposure.”

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There will have to be negotiations.

Trump Sticks With Tariff Plan, Warns EU On Trade (R.)

U.S. President Donald Trump reiterated on Tuesday his plan to slap big tariffs on imports of steel and aluminum, warning the EU it would get hit with a “big tax” for not treating the United States well when it comes to trade. “They make it almost impossible for us to do business with them and yet they send their cars and everything else back into the United States,” Trump said of the EU at a news conference with Swedish PM Stefan Lofven, whose country is an EU member. Trump said the EU was taking advantage of the United States on trade, adding: “They can do whatever they’d like, but if they do that, then we put a big tax of 25% on their cars – and believe me they won’t be doing it very long.”

Trump said on Friday he would impose a duty of 25% on imported steel and 10% on aluminum, a plan that sparked cries of foul from U.S. trading partners and warnings from U.S. lawmakers and businesses of the potential for a tit-for-tat trade war that could hurt the U.S. economy. Trump repeated his belief that the United States could win such a war, since it was running such a large trade deficit. “When we’re behind on every single country, trade wars aren’t so bad,” he told reporters at the White House. Lofven offered a warning of sorts to the U.S. president, saying: “I am convinced that increased tariffs hurt us all in the long run.”

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What’s the phrase? Do as they do, not as they say?

Europe Renews Tariffs On Chinese Steel Pipes As High As 72% (ZH)

As the world watches breathlessly if Trump will follow through with his threat to slap steel and aluminum import tariffs, Europe continues to quietly ratchet up its own trade war with China and nobody seems to mind. On Tuesday, as China was trying to define its future trade relations with the US, it was delivered a broadside from the European Commission after Brussels announced it had renewed tariffs on Chinese steel imports, some as high as 71.9%, saying producers in France, Spain and Sweden face a continued risk of imports from China at unfairly low prices. Ironically, that’s the same thing that Trump is saying. The original measures, imposed last April, saw Europe setting anti-dumping duties on imports of hot-rolled flat steel products from China at a higher rate than the preliminary tariffs already in place.

The European Commission explained it had set final duties of between 18.1% and 35.9% for five years for producers including Bengang Steel Plates, Handan Iron & Steel and Hesteel. This compared with lower provisional rates in place of 13.2 to 22.6%, following a complaint by EU producers ArcelorMittal, Tata Steel and ThyssenKrupp. Fast forward to today when Bloomberg reported that the European Commission reimposed for another five years the duties, which punish Chinese exporters including Huadi Steel for allegedly dumping pipes and tubes in Europe; the levies range from 48.3% to 71.9%, depending on the Chinese exporter.

“The repeal of the measures would in all likelihood result in a significant increase of Chinese dumped imports at prices undercutting the union industry prices,” the commission – the 28-nation EU’s executive arm in Brussels – said in the Official Journal; the five-year renewal will take effect on Wednesday. And even though China’s share of the EU market for stainless steel seamless pipes and tubes has been negligible, and hovering at around 2% since 2013, Brussels had no problem with pursuing what it thought was fair remedies, oblivious of the blowback. And now we turn our attention back to Washington, and whether Trump will do the same.

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Perhaps most interesting: Cohn’s resignation weakens Wall Street’s voice.

US Considers Broad Curbs on Chinese Imports, Takeovers (BBG)

The Trump administration is considering clamping down on Chinese investments in the U.S. and imposing tariffs on a broad range of its imports to punish Beijing for its alleged theft of intellectual property, according to people familiar with the matter. An announcement following an investigation by the U.S. Trade Representative’s office into China’s IP practices is expected in the coming weeks, potentially handing President Donald Trump further cause to impose trade restrictions. His announcement last week of tariffs on steel and aluminum imports has already ratcheted up global trade tensions – and led to the resignation Tuesday of his chief economic adviser Gary Cohn, who opposes such measures. Trump tweeted he’ll be making a decision on a replacement soon and that there are “many people wanting the job.”

The dollar fell and the yen – often a haven in turmoil – jumped as much as 0.6% to 105.46 per dollar, approaching a 16-month high set last week. Asian equities declined. The president is now fighting trade offensives on multiple fronts, from targeting strategic rival China to angering allies like Canada and the EU with threats to erect fresh barriers. While his counterparts have threatened retaliation, concrete action that would herald the start of an all-out trade war has yet to come. Liu He, President Xi Jinping’s top economic adviser who met with Cohn in Washington last week, told delegates at the National People’s Congress in Beijing that both sides had expressed a desire to avoid a trade war. Chinese officials – who have been studying curbs on U.S. products such as soybeans according to past reports – were otherwise largely quiet on the tariff question Wednesday.

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Depends on who succeeds Cohn.

With Cohn Gone, Peter Navarro Is Unleashed At White House (CNBC)

Peter Navarro suffered any number of humiliations in his first year in the White House, where the trade advisor was out of favor with President Donald Trump and his superiors for months. But nothing was more degrading than an order handed down by White House Chief of Staff John Kelly: Navarro had to copy his boss, Gary Cohn, on every single email he sent at the White House. “The chief wanted him under control,” a senior administration official told CNBC on Tuesday, referring to Kelly. But now the free-trading Cohn is stepping down as National Economic Council director, and Navarro’s brand of protectionist nationalism is in the ascendency. Presumably, there will be no one else at the White House looking over Navarro’s email now.

“Peter was quietly effective for nine months,” said an administration official. “He helped his reputation by keeping a low profile and being a model prisoner during his period of captivity. And when his opportunity came, he took it and he won.” Another administration official told CNBC that Cohn’s resignation is “a huge victory for the nationalists.” “Peter Navarro won the trade battle and now Gary’s given up,” that administration official said. “It literally reestablishes the intellectual framework and the personnel who were originally envisioned after Trump won the election. We can let Trump be Trump.” Navarro and Larry Kudlow, a prominent conservative and CNBC contributor, will likely be candidates for Cohn’s job. The second administration official played down the likelihood of Kudlow assuming the economic advisor role, however. Kudlow has been vocal in his opposition to the president’s planned tariffs on steel and aluminum.

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Add China’s Monopoly money to that mix.

It’s Not Bad Trade Deals, It’s Bad Money – Part 2 (Stockman)

In Part 1 we made it clear that the Donald is right about the horrific results of US trade since the 1970s, and that the Keynesian “free traders” of both the saltwater (Harvard) and freshwater (Chicago) schools of monetary central planning have their heads buried far deeper in the sand than does even the orange comb-over with his bombastic affection for 17th century mercantilism. The fact is, you do not get an $810 billion trade deficit and a 66% ratio of exports ($1.55 trillion) to imports ($2.36 trillion), as the US did in 2017, on a level playing field. And most especially, an honest free market would never generate an unbroken and deepening string of trade deficits over the last 43 years running, which cumulate to the staggering sum of $15 trillion.

Better than anything else, those baleful trade numbers explain why industrial America has been hollowed-out and off-shored, and why vast stretches of Flyover America have been left to flounder in economic malaise and decline. But two things are absolutely clear about the “why” of this $15 trillion calamity. To wit, it was not caused by some mysterious loss of capitalist enterprise and energy on America’s main street economy since 1975. Nor was it caused – contrary to the Donald’s simple-minded blather – by bad trade deals and stupid people at the USTR and Commerce Department. After all, American capitalism produced modest trade surpluses every year between 1895 and 1975. Yet it has not lost its mojo during the 43 years of massive trade deficits since then. In fact, the explosion of technological advance in Silicon Valley and on-line business enterprise from coast-to-coast suggests more nearly the opposite.

[..] What changed dramatically after 1975, however, is the monetary regime, and with it the regulator of both central bank policy and the resulting expansion rate of global credit. In a word, Tricky Dick’s ash-canning of the Bretton Woods gold exchange standard removed the essential flywheel that kept global trade balanced and sustainable. Thus, without a disciplinary mechanism independent of and external to the central banks, trade and current account imbalances among countries never needed to be “settled” via gains and losses in the reserve asset (gold or gold-linked dollars).

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China’s behind a few decades, just in time for 1984.

China Dramatically Boosts Spending On Internal Security (WSJ)

China has substantially increased spending on domestic security, official figures show, reflecting mounting concern about threats inside its borders as President Xi Jinping moves to acquire more power and reassert the authority of the Communist Party. Beijing’s budgets for internal and external security have grown faster than the economy as a whole for several years, but domestic security spending has grown far faster — to where it exceeds the national defense budget by roughly 20%. Across China, domestic security accounted for 6.1% of government spending in 2017, the Ministry of Finance said. That translates into 1.24 trillion yuan ($196 billion) and compares with 1.02 trillion yuan in central-government funding for the military.

The numbers, revealed in an annual budget report released this week, help illustrate the scale of a recent intensification of security and surveillance across China, particularly in Xinjiang and Tibet, minority-heavy areas on the country’s periphery. In Xinjiang the government has woven a web of surveillance, with checkpoints, high-definition cameras, facial scanners and street patrols; the region spent $9.1 billion on domestic security in 2017, a 92% increase from 2016, according to local government budget data.

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Any questions?

Greater Toronto Home Sales Down 35% From February 2017 (CBC)

The number of Toronto-area homes sold last month fell nearly 35% and the average selling price dropped more than 12% from historically high levels set last year, the Toronto Real Estate Board reported Tuesday. There was a total of 5,175 residential transactions through the board’s MLS system last month, down 34.9% compared to the 7,955 sales in February 2017. The region’s average selling price, covering all types of residential resales, was down 12.4% to $767,818 — still one of the most expensive in Canada. Detached houses — the most expensive of the major categories tracked by TREB — showed the biggest declines in both the number sold and sales price compared with last year.

The detached category had also been the driving force behind a spike in prices in the early months of 2017 that prompted the Liberal provincial government to introduce a package of measures last April to cool the market. That was followed by a financial stress test for buyers, which officially came into effect on Jan. 1 for federally regulated lenders, following an October announcement by the Office of the Superintendent of Financial Institutions. “When TREB released its outlook for 2018, the forecast anticipated a slow start to the year compared to the historically high sales count reported in the winter and early spring of 2017,” TREB president Tim Syrianos said Tuesday. “Prospective home buyers are still coming to terms with the psychological impact of the Fair Housing Plan, and some have also had to re-evaluate their plans due to the new OSFI-mandated mortgage stress test guidelines and generally higher borrowing costs.”

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It really is north and south now, Italy’s age-old dividing line between rich and poor.

Italy’s Populists Split The Country in Half (BBG)

Italy’s political map is a lot less colorful than it used to be. Whereas in previous elections the main parties had pockets of support across the peninsula, the March 4 vote resulted in a wave of anti-establishment Five Star yellow south of Rome and in the islands, and a sea of blue for the center-right coalition in the north, led by a strong showing on the part of the anti-immigrant League. “The South voted for the Five Star Movement and the North voted for the Lega, but both sides of the country expressed a vote of protest,” Luigi Zingales, professor at the University of Chicago’s Booth School, told Bloomberg TV.

The center-left, which used to dominate the central part of the country, was reduced to a few pockets in its former strongholds and to a handful of prosperous districts in the north. Big cities like Rome and Milan were small red dots isolated from the rest of their regions. The 2013 vote wasn’t so clear cut. It was Five Star’s first ever national election and it did well in Sicily and parts of the center and south, but the traditional parties still held on to some of their fiefdoms. Things went differently this time around. Five Star won every district in Sicily, Sardinia, Puglia, and Molise, and all but one in Campania. Large swathes of Tuscany and Emilia-Romagna and all of Umbria, which had voted left for generations, were won by the center-right.

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What a sad world we live in. Or rather, what sad completely different worlds. Universes even.

In The Alps, Traffickers Prey On Migrants And Rescuers Alike (AFP)

Five African migrants stumble through the snow, exhausted and numb, abandoned hours earlier by a smuggler who left them to make their own way down the mountain from Italy into France. They are among dozens who have been tricked in recent weeks into paying hundreds of euros to people traffickers who promised them a comfortable car ride across the border. The Montgenevre Pass isn’t steep, but the snow is deep, and the young men’s trainers and jeans do nothing to protect them against the biting minus 10ºC (14ºF) chill. If they get lost, it might take hours to cross – long enough to freeze to death. By the time members of the French volunteer group Tous Migrants (We Are All Migrants) come to their rescue in the black of night, the youths are broken.

[..] Thousands of young men from francophone west Africa have trudged across these mountains over the past two years, dreaming of jobs in France. In recent months, as news about the route filters back to Africa, the arrivals have gained pace. Since July, nearly 3,000 have passed through a modest shelter run by Tous Migrants [..] The smugglers, who are also French-speaking west Africans, charge up to €350 euros ($430) to sneak people into France. But once the group reaches the Italian border village of Claviere by train and bus, the car that is supposed to carry them on the last leg of their journey to Paris never materialises. The smugglers instead call the French volunteers to notify them that a group of Africans is heading their way – and then turn on their heels.

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One more piece arguing Greece needs to ‘reform’ to recover. BS.

Europe’s Recurring Financial Crisis Has Not, Repeat, Not Ended (F.)

It will happen again. Europe will go through another financial crisis, probably centered in Greece but not necessarily. It has had several already, because from the start few of the troubled countries have made the fundamental reforms needed to meet their obligations. Instead, the richer parts of the currency union, Germany in particular, have advanced funds on conditions of austerity that not only ignore the fundamentals but are otherwise counterproductive. The recipients pretend that they will abide by German conditions, and Berlin, to duck the disruption of a prolonged financial crisis, pretends to believe them. Rescue loans flow, and then, when another failure looms, the show repeats according to the same script. It will happen again.

The most resent run of this show was performed in spring of 2015. Greece, which had starred in the original pilot back in 2010, could not meet the payments due on its debt. German Finance Minister Wolfgang Schaeuble first lectured Greece on its spendthrift ways and then, according to script, said that Berlin would block any aid until Athens increases taxes and cuts spending sufficiently for its budget to run what is called a “primary surplus” (revenues less costs excluding the expense of debt service) equal to 3.5% of GDP. Greek Prime Minister Alexis Tsipras, also according to script, refused, pointing out, correctly too, that past such efforts have imposed unsupportable hardships on the Greek people. At the last moment, again according to script, he caved into Schaeuble’s demands. Berlin allowed Europe to extend the loan, and the crisis quieted as past crises have at this point of the show.

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New lapdog.

New Eurogroup Chief Warns Of Greek Vulnerability (K.)

Greece remains vulnerable to domestic and external shocks, the head of the Eurogroup, Mario Centeno, warned on Tuesday. The Portuguese finance minister also told the Athens-Macedonian News Agency that restoring its credibility in the credit market will be a gradual and not automatic process for this country. Centeno called on Athens to continue implementing the reforms of the bailout program even after its completion, adding that the eurozone will examine its strategy regarding the post-program framework later, along with the easing of Greece’s debt. The Portuguese official stopped short of making any pledges about the debt lightening, sticking to the letter of the Eurogroup decision.

Referring to the country’s access to the markets, Centeno stated that “if the conditions are fulfilled for the further easing of the debt at the end of the program, the Eurogroup – as has unequivocally been agreed – is ready to assist in this process.” He added that “all additional measures on the debt will have to be analyzed at a technical level. They will only be adopted if the two conditions are fulfilled: The program has to be completed successfully and the debt easing will have to be necessary for the Greek debt to be considered sustainable. This is why we need an integrated analysis by the institutional bodies; at the moment that has not come.”

Centeno said Greece is a “unique case in the eurozone,” implying that it is in this context that its exit from the bailout program will be examined. He added that “the end of the program will constitute a new political reality for Greece. Whatever the framework of monitoring agreed, Greece will regain control of its policies. Yet just as with every other European [Union] country, such policies will have to be compatible with the European framework.” He said he is not interested in Greek election results, but revealed that the EU is concerned about the political agenda in Greece: “I would just recommend to Greece to continue on its own reform agenda,” Centeno stated.

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Erdogan plays to cheap nationalist sentiments. Which can be fired up much higher by shooting at something. Where’s NATO, US, Germany?

Why Turkey Wants to Invade the Greek Islands (Bulut)

There is one issue on which Turkey’s ruling Justice and Development Party (AKP) and its main opposition, the Republican People’s Party (CHP), are in complete agreement: The conviction that the Greek islands are occupied Turkish territory and must be reconquered. So strong is this determination that the leaders of both parties have openly threatened to invade the Aegean. The only conflict on this issue between the two parties is in competing to prove which is more powerful and patriotic, and which possesses the courage to carry out the threat against Greece. While the CHP is accusing President Recep Tayyip Erdogan’s AKP party of enabling Greece to occupy Turkish lands, the AKP is attacking the CHP, Turkey’s founding party, for allowing Greece to take the islands through the 1924 Treaty of Lausanne, the 1932 Turkish-Italian Agreements, and the 1947 Paris Treaty, which recognized the islands of the Aegean as Greek territory.

In 2016, Erdogan said that Turkey “gave away” the islands that “used to be ours” and are “within shouting distance.” “There are still our mosques, our shrines there,” he said, referring to the Ottoman occupation of the islands. Two months earlier, at the “Conference on Turkey’s New Security Concept,” Erdogan declared: “Lausanne… has never been a sacred text. Of course, we will discuss it and struggle to have a better one.” Subsequently, pro-government media outlets published maps and photos of the islands in the Aegean, calling them the territory that “Erdogan says we gave away at Lausanne.”


Borders between Greece and Turkey after 1923 Lausanne Treaty

Ilargi: This may seem extreme, but original plans proposed by the -rejected- 1920 Sèvres Treaty went even further, giving Greece large parts of mainland Turkey as well. This was negotiated after the Ottoman empire lost WWI. The discussions also included claims to the likes of Palestine, Syria and Lebanon. Both treaties were negotiated -and signed- by the Ottoman Empire and the Allied French Republic, British Empire, Kingdom of Italy, Empire of Japan and the Kingdom of Romania. Somewhat ironially, the Kingdom of Greece was the only party not to sign Sèvres. Which was also heavily contested by Kemal Atatürk in Turkey. Wiki: ‘Atatürk led Turkish nationalists to defeat the combined armies of the signatories of the Treaty’ in the Turkish Independence War (1919-1923)


Borders between Greece and Turkey proposed by -rejected- 1920 Sèvres Treaty

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We read this. And then we all get in our cars.

Arctic Has Warmest Winter On Record (AP)

The Arctic [..] experienced its warmest winter on record. Sea ice hit record lows for the time of year, new US weather data revealed on Tuesday. “It’s just crazy, crazy stuff,” said Mark Serreze, director of the National Snow and Ice Data Center in Boulder, Colorado, who has been studying the Arctic since 1982. “These heat waves – I’ve never seen anything like this.” Experts say what’s happening is unprecedented, part of a global warming-driven cycle that probably played a role in the recent strong, icy storms in Europe and the north-eastern US. The land weather station closest to the North Pole, at the tip of Greenland, spent more than 60 hours above freezing in February.

Before this year, scientists had seen the temperature there rise above freezing in February only twice before, and then extremely briefly. Last month’s record-high temperatures have been more like those typical of May, said Ruth Mottram, a climate scientist at the Danish Meteorological Institute. Of nearly three dozen different Arctic weather stations, 15 of them were at least 10F (5.6C) above normal for the winter. “The extended warmth really has staggered all of us,” Mottram said. In February, Arctic sea ice covered 5.4m square miles, about 62,000 square miles smaller than last year’s record low, the ice data center reported, and it was 521,000 square miles below the 30-year normal.

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