Oct 262016
 
 October 26, 2016  Posted by at 9:52 am Finance Tagged with: , , , , , , , , , ,  Comments Off on Debt Rattle October 26 2016


Dorothea Lange Depression refugee family from Tulsa, Oklahoma 1936

The Euro Has Been A Disaster For Southern European Production (Gefira)
Washington: Don’t Think It’s Over When Trump Loses (Steve Keen)
213 North American Oil Industry Companies Have Now Declared Bankruptcy (FF)
China Tightens Capital Controls Amid Yuan’s Continuing Slide (Nikkei)
London House Prices Forecast to Plunge as Brexit Chokes Market (BBG)
AT&T Is Spying On Americans For Profit (DB)
The US Is Currently Bombing Seven Countries (PF)
Trump Says Clinton Policy On Syria Would Lead To World War Three (R.)
Most Americans Do Not Feel Represented By Democrats Or Republicans (G.)
The Biggest F*ck Ever Recorded In Human History (Michael Moore)
Antarctic Glaciers Are Melting at a ‘Staggering’ Rate (Gizm.)

 

 

Why it has to stop. Or rather, why it will be stopped.

The Euro Has Been A Disaster For Southern European Production (Gefira)

Some say that the common currency prevents less productive economies from cheating by weakening their national currencies and forces them to become more efficient and competitive. Industrial production data shows that it is not the case. Italy, France, Greece and Portugal have not only stopped producing more; they are producing now less than in 1990! The decay started immediately after the introduction of the euro in 2002! The OECD industrial production data analysis leads to the following conclusions: 1. since 1990 industrial production (manufacturing and construction included) has been growing in volume at large, even in the most developed countries; 2. the disproportion between industrial output in Germany and two other biggest euroarea economies, Italy and France, occurred already just after the 2001-2002 crisis; 3. Southern Europe’s economies have lost their ability to rebound in industrial production alongside the adoption of the euro.

1. Industrial output can increase In most of the most developed countries in the world industrial production has grown in volume since 1990, although a great deal of manufacturing capacities have been moved from the West to the emerging markets. Moreover, in countries like the USA, Israel, Switzerland, Austria and Germany the output has surpassed the 2008 pre-crisis levels. However, if we take a look at the euroarea or the Group of Seven (G7), then numbers are still lower than in 2008 but definitely higher than in 1990.

2. The euroarea has a problem A closer look at the European industrial production numbers gives a clear signal: something bad has happened after 2000. Before the introduction of euro, production trends ran more or less in the same direction. Meanwhile after the 2001-2002 crisis, French and Italian output did not rebound, while production in Germany expanded enormously and was able to reach the 2008 level quickly after the last crisis. Industry in France and Italy not only has not rebounded but also has started to curb.

3. Southern Europe will not rebound with the euro
Countries with a sovereign currency can easily build up their economies because of one simple mechanism: depreciation. A relatively strong currency (strong in comparison to the economic condition) would not have to be a problem for Italy or Greece if there still were some capacities for more debt. Then internal consumption could prop up industrial production. But Spain, Greece, Italy and Portugal have had neither a weak sovereign currency nor the possibility of incurring more debt.

Industry is very important for the economy, as it creates jobs and innovations. The euroarea in the current form is preventing Southern Europe’s industry from developing because of a different type of economy there. “Roman” economies are not worse than than Germany’s. They just need other tools, so restricting all these various economies in the German fashion will destroy the euro as well as the European unity.

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Steve Keen on which employment numbers are actually relevant. Curious to see how many people think Hillary’s got it in the bag. As an example, here’s a Bloomberg poll that just came out:

Washington: Don’t Think It’s Over When Trump Loses (Steve Keen)

Trump’s fans certainly have their “dark fantasies”, but Washington and Krugman have a “bright fantasy” if they believe that unemployment is genuinely low. My favourite and unimpeachable proof that this is false is an easily-obtained data series: the percentage of Americans aged 25-54 who have a job. While the “Unemployment Rate” is back within half a per cent of its pre-crisis low, the percentage of Americans aged 25-54 who have a job today is 2% lower than it was before the crisis. Perhaps an even more important fact that explains the anger behind Trump (and Sanders too, before he was eliminated by the Democratic Party’s peculiar primary process) is that the employment rate actually peaked in 2000, and even after this recovery, it is still 4% lower than in 2000 (78% today versus 82% in 2000).

What that means in terms of people with jobs is even more telling. The number of people aged 25-54 with a job in the USA peaked at 104.7 million in December 2007. It bottomed at 100.3 million in October 2013, and as of February 2015 (the most recent data) it was 101.2 million. So when Washington is talking about achieving “full employment” again, there are still more than 3 million less people employed today than in 2007. Demographic change has caused this segment of the population to decline since December 2007—from 126 million then to 125 million in February 2015—but that still means 2 million more people are unemployed today than in 2007. So if you look at the unemployment rate, everything is wonderful. That seems to be what Washington insiders—all with well-paying jobs—are doing. But if you look at the employment rate, the economy is still in the doldrums. Which series is telling the truth about the US economy?

The employment to population ratio is telling the truth, because it’s derived by asking employers how many people they have on their payroll. The unemployment rate, on the other hand, lies about the real level of unemployment, because it is derived by asking individuals whether they fulfil a number of criteria, including whether they have looked for a job in the last 4 weeks. The employment ratio accurately tells you the number of people receiving a salary; the unemployment ratio does not accurately tell you who is not receiving one. It’s no comfort to someone not receiving a salary to be told that they are not also unemployed, according to the official definition. Their justified reaction is to tell the “official definition” what to do with itself.

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A few billion here and a few billion there in debt.

213 North American Oil Industry Companies Have Now Declared Bankruptcy (FF)

Fewer and fewer oil exploration and production companies are declaring bankruptcy. But more oilfield service companies are. So far this month, only one North American E&P firm filed for Chapter 11 protection, according to data released on Tuesday by the Dallas law firm Haynes & Boone. That’s down from two in September, three in August and four in July. But it’s been an especially tough few months for service companies. As crude prices began crashing in 2014, drillers started idling rigs. That led to fewer jobs for the companies that make their money helping producers pump oil and gas. Moreover, when producers did hire service companies, they often forced them to heavily discount their rates.

Eight service companies filed this month. Seven filed last month, and eight again the month before. Almost 50 have filed in the last six months, half of the 108 over two years. In total, 213 North American oil and gas companies have now filed for bankruptcy since the start of 2015, listing more than $85 billion in debt. The most recent exploration firm: the private oil and gas company Mountain Divide, based in Montana, filed on Oct. 14, and listed $83 million in debt. On the oilfield services side, Houston-based Key Energy Services filed on Monday, with more than $1 billion in debt. And Basic Energy Services, headquartered in Fort Worth, said Monday it had reached an agreement with debt holders to file by Tuesday.

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While at the same time letting Chinese foreign purchases escalate.

China Tightens Capital Controls Amid Yuan’s Continuing Slide (Nikkei)

China has toughened restrictions on capital flows to prevent a negative feedback loop between a weakening yuan and capital flight. The State Administration of Foreign Exchange has introduced new capital measures in areas such as Shanghai and Guangzhou since the beginning of autumn, asking foreign and regional banks to cap the amount of foreign currency they will sell to customers during 2016. These limits, though ostensibly up to banks’ discretion, are set by negotiation with authorities and so are essentially directed by the government, a financial sector source said. A gag order has been imposed surrounding the measures, the source said. Some banks apparently have set steep exchange rates to pre-emptively curb foreign currency sales, a practice that could pose issues for foreign companies in China trying to repatriate earnings, for example.

China’s trade has flagged in recent months, with exports dropping 10% in September from the year-earlier level in dollar terms. The prospect of an interest rate hike in the U.S., meanwhile, has market players expecting further declines in the yuan’s value. Stashing assets abroad, rather than keeping them in China, is increasingly seen as the safer option. This view has led to further selling of the yuan, giving rise to a downward spiral that capital controls aim to break. Both the foreign exchange regulator and the People’s Bank of China have given banks several directives this year to curb outflows and the currency’s slide. Institutions are asked to report on corporate clients’ plans for buying foreign currency. Large fund transfers that involve foreign currency purchases must be explained by the institutions ahead of time. Individuals traveling overseas are asked to make reservations when exchanging money.

The yuan continues to depreciate despite these efforts. The central bank Tuesday set its daily guidance rate for the Chinese currency at 6.77 yuan to the dollar – just a little shy of the 6.82- to 6.83-to-the-dollar range at which the yuan was fixed for nearly two years following the September 2008 financial crisis. At the time, the goal was to prevent the currency from strengthening to stave off an economic slump. The concern now is that the yuan will become weaker and capital will flow out.

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The best thing to could happen in Britain.

London House Prices Forecast to Plunge as Brexit Chokes Market (BBG)

London property prices are set to fall next year as uncertainty about Britain’s exit from the EU damps the U.K. housing market, according to the Centre for Economics and Business Research. London, and especially the priciest areas of the capital’s housing market, will be most affected, with prices dropping 5.6% in 2017, according to the consultancy’s predictions. Across the U.K., while property value growth will accelerate to 6.9% in 2016, it’s set to slow to 2.6% next year. “Nervousness and uncertainty are starting to show,” said Kay Daniel Neufeld, an economist at Cebr. “We expect to see house-price growth across the U.K. slowing considerably in the fourth quarter of 2016, a trend that is set to continue in 2017.”

While the housing market was already facing headwinds from tax changes before June’s EU referendum, investors are becoming increasingly nervous about the possibility of a so-called hard Brexit. That could see the U.K. giving up membership of Europe’s single market for goods and services to secure greater control of immigration. Accelerating inflation, increasing unemployment and slowing business investment are all set to weigh on house prices, while curbs on migration and a retreat from the single market could slow demand from international buyers, the Cebr said.

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Wait till we find out what Google does.

AT&T Is Spying On Americans For Profit (DB)

In 2013, Hemisphere was revealed by The New York Times and described only within a Powerpoint presentation made by the Drug Enforcement Administration. The Times described it as a “partnership” between AT&T and the U.S. government; the Justice Department said it was an essential, and prudently deployed, counter-narcotics tool. However, AT&T’s own documentation—reported here by The Daily Beast for the first time—shows Hemisphere was used far beyond the war on drugs to include everything from investigations of homicide to Medicaid fraud. Hemisphere isn’t a “partnership” but rather a product AT&T developed, marketed, and sold at a cost of millions of dollars per year to taxpayers.

No warrant is required to make use of the company’s massive trove of data, according to AT&T documents, only a promise from law enforcement to not disclose Hemisphere if an investigation using it becomes public. These new revelations come as the company seeks to acquire Time Warner in the face of vocal opposition saying the deal would be bad for consumers. Donald Trump told supporters over the weekend he would kill the acquisition if he’s elected president; Hillary Clinton has urged regulators to scrutinize the deal. While telecommunications companies are legally obligated to hand over records, AT&T appears to have gone much further to make the enterprise profitable, according to ACLU technology policy analyst Christopher Soghoian.

“Companies have to give this data to law enforcement upon request, if they have it. AT&T doesn’t have to data-mine its database to help police come up with new numbers to investigate,” Soghoian said. AT&T has a unique power to extract information from its metadata because it retains so much of it. The company owns more than three-quarters of U.S. landline switches, and the second largest share of the nation’s wireless infrastructure and cellphone towers, behind Verizon. AT&T retains its cell tower data going back to July 2008, longer than other providers. Verizon holds records for a year and Sprint for 18 months, according to a 2011 retention schedule obtained by The Daily Beast.

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Just so you know.

The US Is Currently Bombing Seven Countries (PF)

For this fact check, we wondered if the U.S. is bombing seven countries. That at least has been so: In September 2014, PunditFact rated True a bombed-countries claim by Ryan Lizza of The New Yorker. Lizza referred to President George W. Bush and his successor, Barack Obama, in a tweet that said: “Countries bombed: Obama 7, Bush 4.” At the time, the U.S. on Obama’s watch had bombed Afghanistan, Iraq, Pakistan, Somalia, Yemen, Libya and Syria. When we asked Stein for her backup information, spokeswoman Meleiza Figueroa pointed out various web posts including a September 2014 CNN news story stating that Obama had ordered air strikes in seven countries through the bulk of his eight years in the office.

[..] The Bureau of Investigative Journalism, a nonprofit news service based at City University London, maintains a running list of U.S. military actions in a number of countries. The bureau annotates each incident with links to press reports. When we looked, the bureau’s accounts by country indicated the latest U.S drone strike in Pakistan occurred in May 2016; the latest strike in Somalia was in September 2016; and the latest U.S. strikes in Yemen and Afghanistan were in October 2016. Separately, we noticed, the Department of Defense said in an Oct. 11, 2016, web post that countries including the U.S. battling the Islamic State of Iraq and the Levant, or ISIL, have conducted 15,634 air strikes to date – 10,129 in Iraq, 5,505 in Syria – with the U.S. conducting 6,868 in Iraq and 5,227 in Syria. In a Sept. 30, 2016, post, the U.S. Air Force said attacks from the air have affected ISIL’s “ability to fight and conduct operations in Iraq, Syria and Afghanistan.”

Too, in August 2016, the New York Times reported the U.S. had “stepped up a new bombing campaign against the Islamic State in Libya, conducting its first armed drone flights from Jordan to strike militant targets” in Libya’s coastal city of Sirte. That news story quoted Obama saying during a news conference that the airstrikes were critical to helping Libya’s fragile United Nations-backed government to drive Islamic State militants out of Sirte, which the group has controlled since June 2015. Obama promised the air campaign would continue as long as necessary to make sure that the extremist group “does not get a stronghold in Libya,” the newspaper said.

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Trump -rightly- mirrors something I said a few days ago in Ungovernability “..her harsh criticism of Putin raised questions about “how she is going to go back and negotiate with this man who she has made to be so evil,” if she wins the presidency.”

Trump Says Clinton Policy On Syria Would Lead To World War Three (R.)

U.S. Republican presidential nominee Donald Trump said on Tuesday that Democrat Hillary Clinton’s plan for Syria would “lead to World War Three,” because of the potential for conflict with military forces from nuclear-armed Russia. In an interview focused largely on foreign policy, Trump said defeating Islamic State is a higher priority than persuading Syrian President Bashar al-Assad to step down, playing down a long-held goal of U.S. policy. Trump questioned how Clinton would negotiate with Russian President Vladimir Putin after demonizing him; blamed President Barack Obama for a downturn in U.S. relations with the Philippines under its new president, Rodrigo Duterte; bemoaned a lack of Republican unity behind his candidacy, and said he would easily win the election if the party leaders would support him.

“If we had party unity, we couldn’t lose this election to Hillary Clinton,” he said. On Syria’s civil war, Trump said Clinton could drag the United States into a world war with a more aggressive posture toward resolving the conflict. Clinton has called for the establishment of a no-fly zone and “safe zones” on the ground to protect non-combatants. Some analysts fear that protecting those zones could bring the United States into direct conflict with Russian fighter jets. “What we should do is focus on ISIS. We should not be focusing on Syria,” said Trump as he dined on fried eggs and sausage at his Trump National Doral golf resort. “You’re going to end up in World War Three over Syria if we listen to Hillary Clinton.”

[..] On Russia, Trump again knocked Clinton’s handling of U.S.-Russian relations while secretary of state and said her harsh criticism of Putin raised questions about “how she is going to go back and negotiate with this man who she has made to be so evil,” if she wins the presidency.

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“Less than half the public (43%) say they have a great deal of confidence that their vote will be counted accurately..”

Most Americans Do Not Feel Represented By Democrats Or Republicans (G.)

As they go to the polls in a historic presidential election, more than six in 10 Americans say neither major political party represents their views any longer, a survey has found. Dissatisfaction with both Democrats and Republicans has risen sharply since 1990, when less than half held that neither reflected their opinions, according to research by the Public Religion Research Institute (PRRI). The seventh annual 2016 American Values Survey was carried out throughout September among a random sample of 2,010 adults in all 50 states. Both party establishments have been rattled by the outsider challenges of Donald Trump, who was successful in winning his party’s nomination, and Bernie Sanders, who was not. In a year that seems ripe for third-party candidates, Libertarian Gary Johnson and Jill Stein of the Green party are seeking to capitalise but have fallen back in the polls in recent weeks.

61% of survey respondents say neither political party reflects their opinions today, while 38% disagree. 77% of independents and a majority (54%) of Republicans took this position, while less than half (46%) of Democrats agree. There was virtually no variation across class or race. Both Democratic presidential nominee Hillary Clinton and Republican standard bearer Trump continue to suffer historically low favourability ratings, with less than half of the public viewing each candidate positively (41% v 33%). Clinton is viewed less favourably than the Democratic party (49%), but Trump’s low rating is more consistent with the Republican party’s own favourability (36%).

The discontent with parties and candidates extends to the electoral process itself, which Trump claims is rigged against him. Less than half the public (43%) say they have a great deal of confidence that their vote will be counted accurately, while 38% have some confidence and 17% have hardly any confidence. [..] The PRRI found that pessimism about the direction of the US is significantly higher today (74%) than it was at this time during the 2012 presidential race, when 57% of the public said the country was on the wrong track.

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Slightly confused: I thought he was pro-Hillary?!

The Biggest F*ck Ever Recorded In Human History (Michael Moore)

I know a lot of people in Michigan that are planning to vote for Trump and they don’t necessarily agree with him. They’re not racist or redneck, they’re actually pretty decent people and so after talking to a number of them I wanted to write this. Donald Trump came to the Detroit Economic Club and stood there in front of Ford Motor executives and said “if you close these factories as you’re planning to do in Detroit and build them in Mexico, I’m going to put a 35% tariff on those cars when you send them back and nobody’s going to buy them.” It was an amazing thing to see. No politician, Republican or Democrat, had ever said anything like that to these executives, and it was music to the ears of people in Michigan and Ohio and Pennsylvania and Wisconsin – the “Brexit” states.

You live here in Ohio, you know what I’m talking about. Whether Trump means it or not, is kind of irrelevant because he’s saying the things to people who are hurting, and that’s why every beaten-down, nameless, forgotten working stiff who used to be part of what was called the middle class loves Trump. He is the human Molotov Cocktail that they’ve been waiting for; the human hand grande that they can legally throw into the system that stole their lives from them. And on November 8, although they lost their jobs, although they’ve been foreclose on by the bank, next came the divorce and now the wife and kids are gone, the car’s been repoed, they haven’t had a real vacation in years, they’re stuck with the shitty Obamacare bronze plan where you can’t even get a fucking percocet, they’ve essentially lost everything they had except one thing – the one thing that doesn’t cost them a cent and is guaranteed to them by the American constitution: the right to vote.

They might be penniless, they might be homeless, they might be fucked over and fucked up it doesn’t matter, because it’s equalized on that day – a millionaire has the same number of votes as the person without a job: one. And there’s more of the former middle class than there are in the millionaire class. So on November 8 the dispossessed will walk into the voting booth, be handed a ballot, close the curtain, and take that lever or felt pen or touchscreen and put a big fucking X in the box by the name of the man who has threatened to upend and overturn the very system that has ruined their lives: Donald J Trump.

They see that the elite who ruined their lives hate Trump. Corporate America hates Trump. Wall Street hates Trump. The career politicians hate Trump. The media hates Trump, after they loved him and created him, and now hate. Thank you media: the enemy of my enemy is who I’m voting for on November 8. Yes, on November 8, you Joe Blow, Steve Blow, Bob Blow, Billy Blow, all the Blows get to go and blow up the whole goddamn system because it’s your right. Trump’s election is going to be the biggest fuck ever recorded in human history and it will feel good.

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“.. like ice cubes rising as a soft drink is poured into a glass.”

Antarctic Glaciers Are Melting at a ‘Staggering’ Rate (Gizm.)

Scientists have long viewed the Amundsen sea embayment as the Achilles heel of West Antarctica, with papers in the 1970s and ‘80s describing it as “uniquely vulnerable,” “unstable,” and the “weak underbelly” of the continent. The fear, then and now, was that warm ocean waters lapping against the foot of the glaciers could cause the ice to pop up off of its rocky floor, like ice cubes rising as a soft drink is poured into a glass. When ice detaches from its so-called “grounding line,” it kickstarts a chain reaction that can trigger a lot of melting. “When water gets between ice and land, it moves quickly, bringing lots of heat in, and melting the ice above it more rapidly,” said Thomas Wagner, the director of NASA’s polar science program. “The Amundsen sea embayment is a place where we know this is happening.”

Indeed, satellite and radar data show that two of West Antarctica’s largest glaciers, Pine Island and Thwaites, have seen their grounding line retreat many miles since 2000, causing fresh water to pour off the ice and into the ocean. This process is so effective that glaciologists recently declared the total collapse of the Amundsen sea embayment—whose glaciers contain enough water to raise global sea levels by four feet—to be “unstoppable.” Here’s the rub: We still have no idea how quickly all of that ice will go, meaning we have no idea whether to prepare for a lot more sea level rise in ten years, in a generation, or at the end of the century. A new study, led by glaciologist Ala Khazendar of NASA’s Jet Propulsion Laboratory, points to ice disappearing sooner rather than later.

For years, NASA has been conducting an airborne campaign called Operation Ice Bridge, flying across sections of our planet’s north and south polar ice sheets and using ground-penetrating radar to measure changes beneath the surface. When Khazendar examined Ice Bridge’s datasets for the Amundsen sea embayment, he realized that NASA flew almost exactly the same path in 2009 that it did in 2002. “This presented an excellent opportunity to look at how ice thickness changed,” he said.

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NOTE: we know our Comments section doesn’t function properly. We’re looking into it.

Oct 232016
 
 October 23, 2016  Posted by at 9:12 am Finance Tagged with: , , , , , , , , , ,  Comments Off on Debt Rattle October 23 2016


NPC Oldsmobile Golden Rocket 88 Holiday Sedan for 1957, Columbus GA 1908

Financial Crises: 1987, 1997, 2007, 2017?! (BBG)
Government Debt Isn’t The Biggest Threat To Australia’s Credit Rating (G.)
Britain’s Leading Banks Set To Pull Out Of UK Early Next Year (G.)
AT&T To Buy Time Warner In Deal Trump Says ‘Destroys Democracy’ (G.)
Hillary Has ‘Nothing To Say’ About Email Revealing $12 Million Quid Pro Quo (DM)
Obama Warned of Rigged Elections Back in 2008 (ZH)
Trump Lays Out His Plan For First 100 Days In Office (ZH)
Official Publication Says China Needs Xi As Mao-Like Strongman Leader (SCMP)
Edward Snowden Is A Saint, Not A Sinner (Jimmy Wales)
75% Of Young Greeks, Italians Live With Their Parents (Kath.)
Rescuers Save 2,400 Migrants In Mediterranean, Recover 14 Bodies (R.)

 

 

Fun with numbers.

Financial Crises: 1987, 1997, 2007, 2017?! (BBG)

Next year ends in a 7. If you’re superstitious or a little loose with statistics, that makes us due for another financial crisis. The biggest one-day stock drop in Wall Street history happened in 1987. The Asian crisis was in 1997. And the worst global meltdown since the Great Depression got rolling in 2007 with the failure of mortgage lenders Northern Rock in the U.K. and New Century Financial in the U.S. You can’t really mark the next crisis down on your calendar, of course. The point is that crackups come fairly regularly. And some of the prerequisites for the next one do seem to be falling into place. The IMF may have gotten things about right in its annual Global Financial Stability Report, which was issued in October. It doesn’t sound an alarm but expresses concern.

Short-term risks have actually abated, the IMF says, pointing to rebounding commodity prices, which help some key emerging markets, and the prospect of easier money in developed markets. But, it says, “medium-term risks continue to build.” It cites the unsettled political climate, which makes entrenched problems harder to tackle; some weak financial institutions in developed markets; and heavy corporate debts in emerging markets. Risks that aren’t acute can build for a while before triggering a crisis. What’s indisputable is that debt, the tinder of almost every financial conflagration, is growing rapidly. At 225 percent of world gross domestic product, combined public and private debt outside the financial sector “is currently at an all-time high,” the IMF says. Debt fuels growth but also makes borrowers brittle. Debtors keep owing money even if they lose the ability to repay. If they default, their lenders are damaged and sometimes default on their own obligations, and so the dominoes fall.

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The last paragraphs of a piece that just can’t seem to get going, but ends ‘well’. Private debt is by far Australia’s main problem, as it is nearly everywhere else.

Government Debt Isn’t The Biggest Threat To Australia’s Credit Rating (G.)

The new head of the Reserve Bank, Philip Lowe, told the house economics committee soon after taking over the position last month, that the effects of a ratings downgrade on borrowing costs are “quite small”. He suggested that rather than be the main game, that credit ratings were just “a useful reminder that we need to make sure the recurrent budget is on a good path”. But while our government debt remains “admirable” by international standards, as the secretary of the treasury, John Fraser, noted this week, our levels of private debt are extremely high – indeed fifth-highest in the world. Worryingly, the IMF in its recent fiscal monitor report noted the level of this debt was a concern for Australia’s ongoing financial stability.

Fraser noted this aspect as well in his appearance before the Senate estimates committee, telling the committee that the Treasury, “are also conscious that credit rating agencies are focusing on household debt as well as corporate and government debt”. Policies to lower private debt however are much more thin on the ground than are the cries about the need to cut government spending to reduce government debt. The shadow treasurer, Chris Bowen, this week raised the issue in an opinion piece published by Guardian Australia. He highlighted that the ALP’s policy on capital gains tax and negative gearing, which it took to the last election, was the type of policy proscribed by organisations like the IMF to temper our love of taking on more and more private debt.

Should S&P downgrade Australia’s credit rating, no doubt almost all commentary and debate will focus on government debt. But regardless of whether or not such a downgrade will cause interest rates for governments and companies to rise, private – not government – debt will remain the issue that most urgently needs to be addressed.

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Hubris. Largely.

Britain’s Leading Banks Set To Pull Out Of UK Early Next Year (G.)

Britain’s biggest banks are preparing to relocate out of the UK in the first few months of 2017 amid growing fears over the impending Brexit negotiations, while smaller banks are making plans to get out before Christmas. The dramatic claim is made in the Observer by the chief executive of the British Bankers’ Association, Anthony Browne, who warns “the public and political debate at the moment is taking us in the wrong direction”. A source close to Brexit secretary David Davis said he and the chancellor Philip Hammond had last week sought to offer reassurance that they were determined to secure the status of the City of London.

However, the government’s stated intention to take control of the freedom of movement into the UK is widely recognised among officials to be a hammer blow to any chance of retaining the present terms of trade for banks, particularly given the bellicose rhetoric of major politicians on the continent. The so-called passporting rights for members of the single market allow UK-based banks to offer financial services to companies and individuals across the EU unimpeded, yet the French president François Hollande is among those who have insisted in recent weeks that hard Brexit will mean “hard negotiation” and that Britain will need to “pay the price” of leaving.

A hard Brexit would involve the UK leaving both the single market, a cental pillar of which is freedom of movement, and the customs union, which could potentially reintroduce tariff and non-tariff restrictions on British imports and exports. Browne warns that both British and European politicians who appear to be pursuing “anti-trade” goals need to recognise that “putting up barriers to the trade in financial services across the Channel will make us all worse off”. Browne, whose organisation has been in intense negotiations with the government, further warns the EU that banks based in UK are currently lending £1.1tn, therefore “keeping the continent afloat financially”, and that this arrangement is at risk.

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How many times has Time Warner been bought and sold now? Remember AOL?

AT&T To Buy Time Warner In Deal Trump Says ‘Destroys Democracy’ (G.)

The telecoms giant AT&T has agreed to pay $85bn to buy the media powerhouse Time Warner and create one of the world’s largest media, TV and telecoms firms. The boards of the two companies unanimously approved the deal on Saturday. AT&T will pay $107.50 per Time Warner share, in a combination of cash and stock, worth $85.4 billion overall. The deal, which combines America’s second-largest wireless telecoms company with the owner of HBO, CNN, Cartoon Network and the Warner Brothers movies, is likely to face tough regulatory scrutiny due to fears it could lead to less consumer choice and higher prices. If approved, the deal would be the biggest in the world this year.

AT&T’s CEO, Randall Stephenson, says he does not anticipate government blocking the acquisition, which the company says is expected to go through by the end of 2017. Time Warner’s CEO, Jeff Bewkes, says he expects all of his company’s creative and business executives to stay on “for a number of years”. The Republican presidential nominee said on Saturday he would block the deal if he were elected. In a speech in Gettysburg, Pennsylvania, Donald Trump said AT&T’s purchase of Time Warner would give the combined group “too much concentration of power” and would “destroy democracy”. Speaking about his continuing battle with the “dishonest mainstream media”, Trump said: “They’re trying desperately to suppress my vote and the voice of the American people.

“As an example of the power structure I’m fighting, AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it’s too much concentration of power in the hands of too few.” Trump said he would also consider “breaking” up the last big media deal, Comcast’s acquisition of NBC Universal in 2013. “Deals like this destroy democracy,” he said.

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Hillary and her campaign blaming everything on Russia is prodoundly damaging to the US, and on the office of President of the Unted States in case she gets elected.

Hillary Has ‘Nothing To Say’ About Email Revealing $12 Million Quid Pro Quo (DM)

A stone-faced Hillary Clinton refused to comment tonight on an email a top aide sent calling a Clinton Foundation quid pro quo a ‘mess’ of the former secretary of state’s own making. ‘I have nothing to say about Wikileaks, other than I think we should all be concerned about what the Russians are trying to do to our election and using Wikileaks very blatantly to try to influence the outcome of the election,’ Clinton said. The Democratic nominee was responding to a question posed by DailyMail.com during a media avail with reporters riding on her campaign plane.

Hacked emails revealed an internal disagreement among Clinton’s aides about her desire to hold a conference in Marrakech, Morocco.The country’s king made a $12 million pledge to fund the Clinton Global Initiative conference – but only if the the likely presidential candidate attended. Top confidante Huma Abedin bluntly wrote in a January 2015 email that ‘if HRC was not part of it, meeting was a non-starter.’ Then she warned: ‘She created this mess and she knows it.’ It was an uncharacteristic remark from Abedin, who is known for her abiding loyalty to Clinton over the years.

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Whatever direction the wind comes from.

Obama Warned of Rigged Elections Back in 2008 (ZH)

At a campaign rally for Hillary Clinton on Thursday in Miami Gardens, Fla., President Obama condemned Donald Trump’s “rigged election” claims, describing these remarks as “dangerous.” “When you try to sow the seeds of doubt in people’s minds about the legitimacy of our election, that undermines our democracy,” he said. “When you suggest rigging or fraud without a shred of evidence, when last night at the debate, Trump becomes the first major party nominee in American history to suggest that he will not concede despite losing…that is not a joking matter,” Obama added.

Trump said at the third presidential debate that he would keep the United States “in suspense” as to whether he would accept the election results. Later, at a campaign rally, he promised in a jesting manner that he would accept the results “if I win” as the crowd roared. But despite condemning Trump for suggesting an election can be rigged, here is a clip of then-candidate Barack Obama in 2008 warning about voter fraud and suggesting Republicans could try to sway the election in their favor. A female audience member asked… “I would just like to know what you can do to reassure us that this election will not be rigged or stolen?” Obama replies…

 

 

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On politics, he sounds less than crazed.

Trump Lays Out His Plan For First 100 Days In Office (ZH)

In a keynote speech in Gettysburg, Pa., about his plans for his first 100 days in office, Donald Trump laid out what he sees as the the core priorities of a Trump presidency, while focusing in the early part of the speech on attacks against Hillary Clinton and Wall Street, and repeating his core message by telling his audience that Washington and Wall Street are “rigged” against him and that he is the candidate to bring “the change that has to come.” “I am not a politician,” Trump told the crowd. “But when I saw the trouble our country was in, I felt I had to act.” Then, moments after promising Americans that he represented a break from the status quo, he promised to sue a number of women who have come forward to accuse him of sexual assault, calling them liars.

Trump also railed against the media for seeking to concentrate its power through mergers and for colluding with his accusers to align against his campaign. He added a new threat to his repeated criticisms of U.S. media companies, when he vowed that in his administration such mega mergers as that between AT&T and Time Warner, which was just announced, would not pass as it leads to “too much concentration of power in the hands of too few.” [..] In terms of soundbites, the following quotes stood out.

On the economy:
• “Change has to come from outside our very broken system.”
• “We’ve doubled our national debt to $20 trillion under President Obama.”
• “Nearly 1 in 4 Americans in their prime earning years isn’t even working.”
• “I am asking the American people to dream big once again.”
• “Will withdraw the U.S. from the Trans-Pacific Partnership.
• “Will cancel every un-Constitutional executive action, memorandum, and order issued by President Obama.”
• “We will cancel all federal funding of sanctuary cities.”
• “The veterans will finally be taken care of properly.”
• “If we follow these steps, we will once more have a government of, by, and for the people.”

In terms of actual political measures that Trump would propose and/or enact, he listed the following six:
1) “A Constitutional Amendment to impose term limits on all members of Congress.”
2) “A hiring freeze on all federal employees.”
3) “A requirement that for every new federal regulation, 2 existing regulations must be eliminated.”
4) “A 5-year ban on White House and Congressional officials becoming lobbyists after they leave government.”
5) “A lifetime ban on White House officials lobbying on behalf of a foreign government.”
6) “A complete ban on foreign lobbyists raising money for American elections.”

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We’ll see lots of this as things continue to slide downhill.

Official Publication Says China Needs Xi As Mao-Like Strongman Leader (SCMP)

China needs a leader like Mao Zedong and President Xi Jinping fits the bill, according to a media outlet affiliated to the Communist Party. Analysts said the call to make Xi a strongman leader was an attempt to raise his status to the equivalent of “Great Leader”. The exhortation was made by Peoples’ Tribune, which is affiliated with party organ People’s Daily and came just ahead of a key meeting of top officials this week to lay the groundwork for the leadership reshuffle next year. The article, published on October 18, also echoed praise from senior politicians earlier this year, calling for Xi to be named “the core” of the party leadership – a term that carries strong political meaning.

China needed a strongman politician so the nation could again rise to greatness amid a time of strategic challenges and risks, it said. Xi, as party general secretary, was widely regarded by officials and the public as such a leader, it said. “There is no longer such salutation as ‘leader’ after Mao,” said Chen Daoyin, a political scientist at Shanghai University of Political Science and Law. Mao’s brief successor Hua Guofeng was once called “Wise Leader”, but no one used “leader” to address Deng Xiaoping, Jiang Zemin or Hu Jintao, Chen said. The magazine added that without the awareness of loyalty to the “core” leadership of the party there was a danger policies would never be adhered to outside the walls of Zhongnanhai, the nerve centre of the party and central government.

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Jimmy Wales is the founder of Wikipedia.

Edward Snowden Is A Saint, Not A Sinner (Jimmy Wales)

Wikipedia is founded on a bedrock principle of neutrality, seeking to describe all relevant sides without taking a political stance. As an individual, I, too, try to stay out of most political debates — except where they directly impact my personal passion for the free flow of information. This is one of those times. When I founded Wikipedia in 2001, the Internet was a place where ordinary people could freely create and share with one another. Wikipedia emerged from that egalitarian spirit, as a community committed to the free exchange of knowledge. Our mission was and continues to be to collect the sum total of all human knowledge and make it available to everybody in their own language. Since its founding, Wikipedia has become one of the most popular websites in the world.

And we zealously guard the privacy of our users, both the 75,000 people who write the encyclopedia and the half-billion people who read it. In 2013, when Edward Snowden revealed the scope and scale of the system of mass surveillance that had been built by the National Security Agency and other national security agencies, we were horrified. It is thanks to Snowden that we can now participate in an informed and democratic debate about how the US government subverted the power of the Internet in the name of mass surveillance. As a result of what he disclosed, people began to realize their privacy had been massively eroded over the past decade, and not just by the NSA. They recognized that their personal information was being collected, stored, analyzed and shared.

Text messages, emails and phone records they thought were private were actually up for grabs, easily accessed by the US government either directly from major tech companies or by tapping the cables and switches that comprise the Internet’s “backbone.” And all of the surveillance was done without a warrant. That is why I’ve signed onto the campaign asking President Barack Obama to pardon Snowden. Without him, ordinary people around the world would still know little of the growing dragnet stifling the Internet’s enormous potential for good. As a result of Snowden’s actions, the Internet has become safer and users are better equipped to protect themselves. Since the disclosures began in 2013, the number of websites moving to HTTPS to encrypt traffic has skyrocketed. (This includes Wikipedia and US federal government websites.) Popular messaging apps like WhatsApp have adopted end-to-end encryption [..]

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And still there’s talk of recovery. And people who believe it, too.

75% Of Young Greeks, Italians Live With Their Parents (Kath.)

Three out of four Greeks aged between 15 and 24 were still living at home in 2014, according to a report by the OECD made public this month. The annual report, called “Society at a Glance,” found that southern European countries hardest hit by the debt crisis had the highest rates of young people remaining with their parents. Greece came second in the list of 35 OECD member states, after Italy, with 76% of young people reporting that they still lived at home. Italy and Greece were followed by Slovakia, Portugal and Spain, while northern European countries, namely Denmark, Sweden, Finland and Norway, had the lowest rates of young people remaining at home. Greece continues to have the highest rate of youth unemployment in the eurozone with more than half of young Greeks jobless and often obliged to live at home.

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Meanwhile, where human rights go to drown….

Rescuers Save 2,400 Migrants In Mediterranean, Recover 14 Bodies (R.)

Rescuers pulled 2,400 boat migrants to safety on Saturday, the Italian coastguard said, adding 14 dead bodies had been recovered in the past two days. The migrants were on rubber boats and other small vessels, it said in a statement. Some 20 operations were carried out on Saturday alone, including rescues involving an Irish naval ship and boats from humanitarian groups Doctors Without Borders and Sea Watch. Doctors Without Borders said in a tweet on Saturday it believed 12 people had died during rescue operations, four of them children. More than 3,100 migrants have gone missing or died this year while trying to use the route from north Africa to Europe by boat, the International Organization for Migration estimates.

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