Jun 262019
 
 June 26, 2019  Posted by at 9:46 am Finance Tagged with: , , , , , , , , , , , ,  7 Responses »


Pablo Picasso The muse 1935

 

Iran Says It Will Never Pursue A Nuclear Weapon (ZH)
Iran Foreign Minister Accuses Bolton Of Plotting For War (R.)
NATO Calls On Russia To Destroy New Missile, Warns Of Response (R.)
Mueller To Testify Before Two House Committees July 17 (AFP)
A. Gary Shilling Says The US Is Already In A Recession
Housing Market Slump Could Drive Global Growth To A Decade Low (MW)
Merrill Lynch Caught Criminally Manipulating Precious Metals Market (ZH)
Apple Doubles Down On Buybacks (Axios)
Italy’s Gold Now Belongs To The ECB (ZH)
Investors With $34 Trillion Demand Urgent Climate Change Action (R.)

 

 

“How many people have you killed with a nuclear weapon? How many generations have you wiped out with these weapons?”

Iran Says It Will Never Pursue A Nuclear Weapon (ZH)

Following Iran’s statement that diplomacy with the United States is “closed forever” after Washington sanctioned the Supreme Leader and other key officials, including on the foreign minister himself – making it practically hard to actually “do” diplomacy given sanctions also have the impact of restricting travel for the nation’s top diplomat – FM Javad Zarif slammed America’s track record with nukes. “You were really worried about 150 people? How many people have you killed with a nuclear weapon? How many generations have you wiped out with these weapons?” Zarif said Tuesday in reference to Trump’s calculus that he refrained from ordering last Thursday night’s readied military strike against Iran when informed 150 people would die.


“It is us who, because of our religious views, will never pursue a nuclear weapon,” Zarif added. Indeed it’s been long understood that since Iran’s Islamic revolution the Ayatollahs have been consistently against nuclear weapons on moral grounds, citing Koranic principles. The US remains the only country in the world to have ever deployed nuclear weapons in a wartime situation, dropping two on Japan at the end of WWII. Though scholars generally agree that the overwhelming destruction on Hiroshima and Nagasaki made counting impossible, conservative estimates tend to be at over 200,000 dead and wounded total wrought by the twin atom bombs dropped over those cities. And of course, the overwhelming majority of the Japanese dead and wounded were civilians.

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How dare he.

Iran Foreign Minister Accuses Bolton Of Plotting For War (R.)

Iran’s Foreign Minister Mohammad Javad Zarif accused U.S. National Security Adviser John Bolton of plotting for war against Iran in a tweet on Tuesday. “Wanna know why those with proven record of detesting diplomacy are suddenly interested in talks? Just read @AmbJohnBolton’s 2017 recipe for destroying the #JCPOA,” Zarif wrote, adding a link to a 2017 article written by Bolton in the National Review. The Joint Comprehensive Plan of Action, or JCPOA, is the landmark 2015 nuclear deal Iran signed with world powers. “Iran never left the negotiation table. #B_Team dragged the U.S. out, while plotting for war,” Zarif added. Zarif has in the past said that a “B-team” including Bolton, an ardent Iran hawk, and Israeli Prime Minister Benjamin Netanyahu, could goad Trump into a conflict with Tehran.

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An excuse for more rockets on Russia’s border.

NATO Calls On Russia To Destroy New Missile, Warns Of Response (R.)

NATO urged Russia on Tuesday to destroy a new missile before an August deadline and save a treaty that keeps land-based nuclear warheads out of Europe or face a more determined alliance response in the region. NATO defense ministers will discuss on Wednesday their next steps if Moscow keeps the missile system that the United States says would allow short-notice nuclear attacks on Europe and break the 1987 Intermediate-range Nuclear Forces Treaty (INF). “We call on Russia to take the responsible path, but we have seen no indication that Russia intends to do so,” Secretary-General Jens Stoltenberg told a news conference. “We will need to respond,” Stoltenberg said.


He declined to go into more details. But diplomats said defense ministers will consider more flights over Europe by U.S. warplanes capable of carrying nuclear warheads, more military training and the repositioning U.S. sea-based missiles. The United States and its NATO allies want Russia to destroy its 9M729/SSC-8 nuclear-capable cruise missile system, which Moscow has so far refused to do. It denies any violations of the INF treaty, accusing Washington of seeking an arms race. Without a deal, the United States has said it will withdraw from the INF treaty on Aug. 2, removing constraints on its own ability to develop nuclear-capable, medium-range missiles.

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Brought to you by the Trump 2020 re-election committee.

Mueller To Testify Before Two House Committees July 17 (AFP)

Former US special counsel Robert Mueller is to testify in public about his report into Russian electoral interference, paving the way for a historic television moment in which Democrats will attempt to make the case for President Donald Trump’s impeachment before the American people. The scrupulously tight-lipped Mueller will appear at back-to-back hearings on July 17 of the House Judiciary and Intelligence Committees, which announced Tuesday that the prosecutor had agreed to abide by subpoenas for his testimony. “Russia attacked our democracy to help Trump win. Trump welcomed and used that help,” House Intelligence Committee chairman Adam Schiff said on Twitter.


“As Mueller said, that should concern every American. And now, every American will get to hear directly from Mueller.” Trump’s apparent response to the announcement came swiftly in a two-word tweet in which he complained, without referring to Mueller, of “Presidential Harassment!” The Mueller report released in April outlined numerous contacts between Trump’s 2016 election campaign and government-linked Russians, as well as evidence that the president tried on several occasions to stymie the investigation. The Democrats have been split on whether to launch impeachment proceedings against the Republican president but — fearing that much of the country is unaware of the Mueller report’s contents — have been asking major figures in the probe to testify in public on its findings.

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He says it will be mild.

A. Gary Shilling Says The US Is Already In A Recession

Gary Shilling, an economist and financial analyst who is credited with predicting several recessions over the past 40 years, thinks the U.S. is in a relatively mild slump. “I think we’re probably already in a recession but I think it will probably be a run-of-the-mill affair, which means real GDP would decline 1.5% to 2%, not the 3.5% to 4% you had in the very serious recessions,” Shilling, president of economic and financial research firm A. Shilling & Co., said in a recent interview broadcast this week by Real Vision. In such a tempered slide, he says, “Stocks probably wouldn’t fall” but if they did, they likely would tumble about 22% — similar to other recent recessions. That, he says, would take the Standard and Poor’s 500 index about 200 points below it’s Christmas Eve nadir of 2,351.


His view is at odds with the vast majority of economists who expect the economy to grow a solid 2% to 2.5% this year after expanding at about a 3% clip last year and in the first quarter. Shilling points to: • Declining industrial production, a result of a weak global economy and the Trump administration’s trade war with China. • Feeble job growth of 75,000 in May, along with downward revisions to prior months. • The Federal Reserve Bank of New York’s recession probability chart, which shows about a 30% chance of a downturn the next 12 months, up from about 10% early this year. That data is based on an inversion of the yield curve, which has shown rates on 3-month Treasury bonds topping 10-year notes recently – a sign that investors don’t have much faith in the longer-term outlook. Inversions do herald recessions but often two years in advance.

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China: $6.8 trillion in household debt, a 70% rise in personal debt from just three years ago.

Housing Market Slump Could Drive Global Growth To A Decade Low (MW)

The global housing market is showing cracks. Those fissures could spread throughout the world-wide economy, potentially sending world-wide gross domestic product, or GDP, to its lowest annual pace of in 10 years, according to research from Oxford Economics, led by economists Adam Slater, and John Payne in a research report dated June 24. “A combined slump in house prices and housing investment in the major economies could cut world growth to a 10-year low of 2.2% by 2020 – and to below 2% if it also triggered a tightening in global credit conditions.” the Oxford Economics researchers wrote.

A decade since the 2008-09 U.S. housing bubble imploded, sparking a global financial crisis, worries about the health of the global housing market persist. An Oxford Economics’ proprietary gauge of housing conditions in the globe shows that home prices have declined by 10% and investments in houses have shrunk by 8%. Housing prices across the globe have come in to focus as a protracted tariff squabble between the U.S. and China ripples throughout the global economy, compelling a number of central bankers to entertain the idea of lowering benchmark borrowing costs in an effort to stimulate, or just maintain, economic expansion.

The Federal Reserve last Wednesday signaled a willingness to lower federal-funds rates, currently at 2.25%-2.50%, if financial conditions worsen. In China, a decade long housing boom has sent home values to the lofty levels, with buying in the region underpinned by some $6.8 trillion in household debt, according to the Bank for International Settlements, a 70% rise in personal debt from just three years ago, with much of that tied to residential mortgages. Oxford Economics says data show that residential investment in China is slowing as are starts for new construction also ebb

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Nopbody goes to jail, nobody even pays a fine. A broken system indeed.

Merrill Lynch Caught Criminally Manipulating Precious Metals Market (ZH)

On Tuesday after the close, the CFTC announced that Merrill Lynch Commodities (MLCI), a global commodities trading business, agreed to pay $25 million to resolve the government’s investigation into a multi-year scheme by MLCI precious metals traders to mislead the market for precious metals futures contracts traded on the COMEX (Commodity Exchange Inc.). The announcement was made by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. In other words, if the Merrill Lynch Commodities group was an individual, he would have gotten ye olde perp walk.

As MLCI itself admitted, beginning in 2008 and continuing through 2014, precious metals traders employed by MLCI schemed to deceive other market participants by injecting materially false and misleading information into the precious metals futures market. They did so in the now traditional market manipulation way – by placing fraudulent orders for precious metals futures contracts that, at the time the traders placed the orders, they intended to cancel before execution. In doing so, the traders intended to “spoof” or manipulate the market by creating the false impression of increased supply or demand and, in turn, to fraudulently induce other market participants to buy and to sell futures contracts at quantities, prices and times that they otherwise likely would not have done so.

Over the relevant period, the traders placed thousands of fraudulent orders. Of course, since we are talking about a bank, and since banks are in charge of not only the DOJ, and virtually every other branch of government, not to mention the Fed, nobody will go to jail and MLCI entered into a non-prosecution agreement and agreed to pay a combined – and measly – $25 million in criminal fines, restitution and forfeiture of trading profits.

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Stock manipulation

Apple Doubles Down On Buybacks (Axios)

Apple again led S&P 500 companies in buybacks, spending a new record $23.8 billion in Q1, more than doubling its spend from the previous quarter, data from S&P Global shows. Apple has long been a buyback behemoth. The company holds 8 of the 10 all-time records for quarterly buybacks, and has spent more than $75 billion on buybacks over just the past year. It has spent $234.7 billion over the most recent 5-year period, and $284.3 billion over the last 10-year period. Apple accounted for 23% of share buybacks made by the top 20 S&P 500 companies. The big picture: While Apple has increased its buyback spending, other S&P 500 companies have slowed from 2018’s record pace.


Companies bought back just $205.8 billion worth of their own shares, a 7.7% decline from Q4 2018, S&P reported. That ended the streak of 4 consecutive quarters of record buybacks. Yes, but: Buybacks rose 8.9% from Q1 2018, which set a record at the time. Outside analysis of the broader stock market, beyond just the S&P, shows announced buyback spending was higher in Q1 2019 than Q4 2018. Ratings agency Moody’s warned last month that companies are spending more on share buybacks and dividends than they were paying in taxes before the 2017 tax cut. The tax savings “can be wiped out entirely by even a modest change in share buybacks,” Christina Padgett, senior vice president at Moody’s, told Axios at the time.

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Italy has quite a lot of it.

Italy’s Gold Now Belongs To The ECB (ZH)

As the squabbling over Italy’s populist government’s plans to blow out its budget deficit to finance an agenda of tax cuts and social spending (including a ‘citizen’s income’ that’s essentially UBI-lite) crowded the headlines, the issue of who owns the 2,451 metric tons of gold reserves held by the Bank of Italy has been quietly ignored – at least, outside of Italy. But that might be about to change. On Tuesday, the ECB asked the League, the dominant party in Italy’s ruling coalition, to remove a reference to the Bank of Italy holding gold as an “exclusive title of deposit” according to Bloomberg. Translation? If Italy is not allowed to have title to Italian gold, then Italy’s gold now belongs to the ECB.

Today’s escalation over Italy’s gold “title” comes two months after the WSJ reported that Italy’s ruling populists pushed ahead with efforts to seize control of the central bank and its gold reserves. Complaining that hundreds of thousands of small individual investors lost billions of dollars after several Italian banks failed in recent years, the current Italian government depicted the central bank as a symbol of a technocratic elite aloof from the needs of ordinary Italians. “We need a change of course at the Bank of Italy if we think about what happened in the last years,” said Deputy Prime Minister Luigi Di Maio, leader of the 5 Star Movement. Shortly thereafter, 5 Star lawmakers asked parliament to pass two draft laws.

One law would instruct the central bank’s owners, most of them private banks , to sell their shares to the Italian Treasury at prices from the 1930s.The other law would declare the Italian people to be the owners of the Bank of Italy’s reserve of 2451.8 metric tons of gold, worth around $102 billion at current prices. “The gold belongs to the Italians, not to the bankers,” said Giorgia Meloni, leader of the Brothers of Italy, a far-right opposition party that supports both bills. “We are ready to battle everywhere in Italy and to bring Italians to the streets if necessary.” So far there has been no fighting but if indeed Draghi just told Italy that its gold now belongs to the Frankfurt-based central bank we expect that to change..

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So how much are they willing to pay?

Investors With $34 Trillion Demand Urgent Climate Change Action (R.)

Investors managing more than $34 trillion in assets, nearly half the world’s invested capital, are demanding urgent action from governments on climate change, piling pressure on leaders of the world’s 20 biggest economies meeting this week. In an open letter to the “governments of the world” seen by Reuters, groups representing 477 investors stressed “the urgency of decisive action” on climate change to achieve the Paris Agreement target. Almost 200 nations agreed in Paris in 2015 to limit the global average temperature rise to well below 2 degrees Celsius above pre-industrial times. Current policies put the world on track for at least a 3C rise by the end of the century.


The letter comes ahead of a June 28-29 G20 summit in Japan and as United Nations Secretary-General Antonio Guterres urges countries to back more ambitious climate goals. “There is an ambition gap… This ambition gap is of great concern to investors and needs to be addressed, with urgency,” a statement from the investors accompanying the letter said. Governments were urged to strengthen their Paris Agreement targets by 2020; phase out thermal coal power and fossil fuel subsidies by set deadlines; set a robust global carbon price by 2020 and improve climate-related financial reporting. “It is vital for our long-term planning and asset allocation decisions that governments work closely with investors to incorporate Paris-aligned climate scenarios into their policy frameworks and energy transition pathways,” the statement said.

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Arundhati Roy:

 

 

 

 

 

Jun 212019
 


Pablo Picasso La guerre 1951

 

Trump Approved Strikes On Iran But Cancelled Them: Reports (AlJ)
The Drone Iran Shot Down Was a $220 Million Surveillance Monster (W.)
The Real Meaning Of Trump’s Deplorable Aggression Against Iran (Stockman)
Senate Blocks Arms Sales To Saudi Arabia In Bipartisan Trump Rebuke (ZH)
More Spent On S&P 500 Buybacks Than All 2018 R&D (Axios)
China Concerned Over Possible US Dollar Shortage Risk (SCMP)
US Spend Ten Times More On Fossil Fuel Subsidies Than Education (F.)
Bring on Higher Oil Prices: They’ll Boost the US Economy (WS)
Defiant Italy Urges Changes To EU Rules (R.)
UK Will Be ‘Diminished’ After Brexit – Dutch PM Rutte (Pol.eu)
Ecuador Judge Frees Ola Bini, Swedish Programer Close To Assange (R.)
Ten Cities Ask EU For Help To Fight Airbnb Expansion (G.)
The Dangerous Methane Mystery (CP)

 

 

When something like this is leaked to multiple news outlets at the same time, isn’t it likely the White House itself does the leaking?

Kim Dotcom’s take:

Trump: Attack Iran now!
General: Iran can sink our Carrier strike group in the region.
Trump: What?
General: If we strike Iran now they can retaliate against thousands of US sailors.
Trump: WTF!
General: This isn’t Syria Sir.
Trump: Call it off.
THE END

Trump Approved Strikes On Iran But Cancelled Them: Reports (AlJ)

US President Donald Trump approved military strikes on Friday against Iran in retaliation for the downing of an unmanned surveillance drone, but pulled back from launching the attacks, the New York Times reported. A US official told Associated Press that the military made preparations on Thursday night for limited strikes on Iran in retaliation for drone shootdown, but approval was abruptly withdrawn. The official, who was not authorised to discuss the operation publicly and spoke on condition of anonymity, said the targets would have included radars and missile batteries.


Planes were in the air and ships were in position, but no missiles fired, when the order to stand down came, the Times cited one senior administration official as saying. The abrupt reversal put a halt to what would have been Trump’s third military action against targets in the Middle East, the paper added, saying Trump had struck twice at targets in Syria, in 2017 and 2018. However, it is not clear whether attacks on Iran might still go forward, the paper said, adding that it was not known if the cancellation of strikes had resulted from Trump changing his mind or administration concerns regarding logistics or strategy.

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This thing is huge: “..a wingspan of more than 130 feet and a maximum takeoff weight of more than 16 tons..”

Why would Iran want that in its airspace?

The Drone Iran Shot Down Was a $220 Million Surveillance Monster (W.)

Early Thursday morning, Iran shot down a United States unmanned aerial vehicle over the Strait of Hormuz, which runs between the Persian Gulf and the Gulf of Oman. Iran identified the drone as an RQ-4A Global Hawk, a $220 million UAV that acts as a massive surveillance platform in the sky. The attack marks an escalation with tensions already running high between the US and Iran—particularly because of the value and technical sensitivity of the downed drone. Iran’s Islamic Revolutionary Guard Corps said on Thursday that the Northrup Grumman-made Global Hawk—part of a multibillion-dollar program that dates back to 2001—had entered Iranian airspace and crashed in Iranian waters; US Central Command confirmed the time and general location of the attack, but insists that the drone was flying in international airspace.


Alamy

The incident comes on the heels of another situation last week in which the US accused Iran of attacking two fuel tankers in the Gulf of Oman. The US also said that Iran had attempted to shoot down a different UAV—an MQ-9 Reaper drone—but failed. The Pentagon also linked Iran to an attack on a Reaper drone in Yemen two weeks ago that caused the vehicle to crash. Thursday’s attack, though, targeted a massive and much more expensive surveillance drone, and likely represents a more definite escalation. “There’s a lot going on here, and we’re probably only seeing some of it,” says Thomas Karako, director of the Missile Defense Project at the Center for Strategic and International Studies.


“This is a more expensive, higher-altitude, more capable, long-range intelligence surveillance reconnaissance craft. If they’re shooting down aircraft in international airspace over international waters, that’s likely to elicit some kind of measured reprisal.” Global Hawks are massive surveillance platforms, in operation since 2001, with a wingspan of more than 130 feet and a maximum takeoff weight of more than 16 tons, equivalent to roughly seven shipping containers of cocaine. They have a range of more than 12,000 nautical miles, can fly at strikingly high altitudes of 60,000 feet, and can stay aloft for 34 hours straight.


U.S. military drone RQ-4A Global Hawk – Eric Harris/U.S. Air Force/Handout via REUTERS

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Iran has no army to speak of, and hardly an economy. But it does have friends.

The Real Meaning Of Trump’s Deplorable Aggression Against Iran (Stockman)

Iran has no blue water Navy that could even get to the Atlantic and only 18,000 sailors including everyone from admirals to medics; an aging, decrepit fleet of war planes with no long range flight or refueling capabilities; ballistic missiles that mainly have a range of under 800 miles; a very limited air defense based on a Russian supplied S-300 system (not the far more capable S-400); and a land Army of less than 350,000 or approximately the size of that of Myanmar. Indeed, Iran’s defense budget of less than $15 billion amounts to just 7 days of spending compared to the Pentagon’s $750 billion; and it is actually far less even in nominal terms than Iran’s military budget under the Shah way back in the late 1970’s. In inflation-adjusted dollars, Iran’s military expenditure today is less than 25% of the level prior to the Revolution.

Whatever the foibles of today’s Iranian theocratic state, a thriving military power it is not. In fact, that’s the real irony. Mostly what comprises the core of Iran air force is left over 40-50 year-old planes that had been purchased from the US under the Shah, and which have been Jerry-rigged with bailing wire and bubble gum to stay aloft and to accommodate some modest avionics and armaments modernizations. As one analyst further noted, some of its planes were actually gifts from Saddam Hussein! Much of the IRIAF’s equipment dates back to the Shah era, or is left over from Saddam Hussein’s Iraqi air force, which flew many of its planes to Iran during the 1991 Persian Gulf War to avoid destruction. American-made F-4, F-5 and F-14 fighters dating from the 1970s remain the backbone of the Iranian air force.

So military threat has absolutely nothing to do with it. Washington is knee deep in harms’ way and on the verge of starting a war with Iran solely on account of a misguided notion that the Persian Gulf is an American Lake that needs to be policed by the US Navy; and, more crucially, that Washington has the right to control Iran’s foreign policy and determine what alliances it may and may not have in the region – including whether or not they pass muster with Bibi Netanyahu. Stated differently, the missions of protecting the oil supply lines and regulating the foreign policy of what amounts to a two-bit economic power is straight out of the playbook of Empire First. As such, it amounts to a foolish policy of putting America’s actual security last.

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When your own party turns against you, it’s time to pay attention.

Senate Blocks Arms Sales To Saudi Arabia In Bipartisan Trump Rebuke (ZH)

The Senate voted on Thursday to block billions of dollars of armaments to Saudi Arabia in what the New York Times described as a “sharp and bipartisan rebuke of the Trump administration’s attempt to circumvent Congress” by declaring an emergency over Iran. “In the first of a series of three back-to-back votes, Republicans joined Democrats to register their growing anger with the administration’s use of emergency power to cut lawmakers out of national security decisions, as well as the White House’s unflagging support for the Saudis despite congressional pressure to punish Crown Prince Mohammed bin Salman after the killing last October of the journalist Jamal Khashoggi”. -NYT

The vote marks the sharpest division between the White House and lawmakers to date – and is the second time in recent months that the administration has faced bipartisan pushback against foreign policy. In April, both the House and Senate voted to cut off military assistance to Saudi Arabia for use in Yemen under the 1973 War Powers Act, only for Trump to veto the measure (the second of his presidency). And once again, Trump will use his veto power to override Congress: “While the Democratic-controlled House is also expected to block the sales, Mr. Trump has pledged to veto the legislation, and it is unlikely that either chamber could muster enough support to override the president’s veto”. -NYT

“This vote is a vote for the powers of this institution to be able to continue to have a say on one of the most critical elements of U.S. foreign policy and national security,” said New Jersey Democrat Sen. Bob Menendez, lead sponsor of the resolutions of disapproval. “To not let that be undermined by some false emergency and to preserve that institutional right, regardless of who sits in the White House.” 22 pending arms sales to three Arab nations were announced in late May utilizing an emergency provision contained in the Arms Export Control Act. In total, $8.1 billion in munitions are part of the sales.

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Call that an economy?

More Spent On S&P 500 Buybacks Than All 2018 R&D (Axios)

Total research and development spending in the U.S. last year totaled $608 billion, according to data from the Federal Reserve, while corporations in the S&P 500 spent $806 billion buying back their own stock. The total for all companies was well over $1 trillion. What it means: In 2018, the 500 biggest U.S. companies spent 33% more on their stock buyback programs than the country is investing in research and development. The trend looks to be continuing this year as the U.S. is on pace to spend $642 billion on R&D in 2019 and poised to surpass last year’s $1.085 trillion total in buyback spending.

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Starting to sound serious.

China Concerned Over Possible US Dollar Shortage Risk (SCMP)

Anbang Insurance Group’s plan to sell its condos at the Waldorf Astoria hotel in New York is the latest in the string of high-profile Chinese divestments that underscores China’s concern that the nation is running short of US dollars. The Chinese holding company bought the Waldorf for a record US$1.95 billion in 2014, but under pressure from the Chinese government, is reported to be seeking buyers for the 375 flats at the hotel despite a glut of unsold luxury flats in Manhattan. In total, it is aiming to shed a portfolio of assets that includes 15 hotels having, like other highly leveraged Chinese conglomerates with overseas investments, been placed under scrutiny by Beijing.

Chinese real estate mogul Wang Jianlin’s Dalian Wanda Group has dumped US$25 billion in assets since 2017, while troubled conglomerate HNA Group was forced to sell everything from Hong Kong land parcels, to its stakes in Deutsche Bank, Hilton Grand Vacations as well as its airlines. Chinese oil giant CEFC China Energy also wants to sell 100 properties worldwide. The government’s dramatic about-face from encouraging aggressive overseas acquisitions to cracking down on risky lending and overseas transfers underscores worries over the risk that the nation could run short of enough US dollars to make the interest and principal payments on its mounting debt at a time when the current account balance is coming under pressure.

“These companies are selling their assets because they don’t have enough US dollars,” said Kevin Lai, chief economist for Asia excluding Japan at Daiwa Capital Markets. “China does not want to use its US$3 trillion foreign reserves for the debt repayments, so that is why these companies need to sell their assets.” On the surface, China should be the last country to worry about a US dollar shortage given that its US$3.1 trillion worth of foreign exchange reserves is the largest help by any nation.

But analysts believe China’s reserves may be insufficient to pay for its massive imports and debt payments in response to a worse-case scenario caused by the ongoing trade war with the United States, particularly since many of its assets cannot readily be turned into cash to help the central bank to save a crashing financial system or sharp devaluation of the yuan’s exchange rate. “In reality, they don’t have as much as US$3.1 trillion of liquid reserves,” said Rabobank analyst Michael Every. “I would estimate they probably only have a little bit more liquid reserves than what they hold in US Treasuries.”

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Fuel fools.

US Spend Ten Times More On Fossil Fuel Subsidies Than Education (F.)

A new International Monetary Fund (IMF) study shows that USD$5.2 trillion was spent globally on fossil fuel subsidies in 2017. The equivalent of over 6.5% of global GDP of that year, it also represented a half-trillion dollar increase since 2015 when China ($1.4 trillion), the United States ($649 billion) and Russia ($551 billion) were the largest subsidizers. Despite nations worldwide committing to a reduction in carbon emissions and implementing renewable energy through the Paris Agreement, the IMF’s findings expose how fossil fuels continue to receive huge amounts of taxpayer funding. The report explains that fossil fuels account for 85% of all global subsidies and that they remain largely attached to domestic policy.


Had nations reduced subsidies in a way to create efficient fossil fuel pricing in 2015, the International Monetary Fund believes that it “would have lowered global carbon emissions by 28 percent and fossil fuel air pollution deaths by 46 percent, and increased government revenue by 3.8 percent of GDP.” The study includes the negative externalities caused by fossil fuels that society has to pay for, not reflected in their actual costs. In addition to direct transfers of government money to fossil fuel companies, this includes the indirect costs of pollution, such as healthcare costs and climate change adaptation. By including these numbers, the true cost of fossil fuel use to society is reflected.

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Yeah, try and sell that to your voters.

Bring on Higher Oil Prices: They’ll Boost the US Economy (WS)

Powered by the iffy situation in the Persian Gulf, the Strait of Hormuz, and the Gulf of Oman, with attacks on tankers and now the downing of a US drone, the price of crude oil got a little nervous in recent days. WTI jumped about 6% today to over $57 a barrel. But this was just a minor uptick in the overall scheme of things: The US, which has become the largest oil producer in the world, is in the middle of its second oil bust in five years:

P These two oil busts are largely a consequence of surging US crude oil production. During the oil bust of 2014-2016, the price of WTI collapsed by over 75%, careening from $107 per barrel to a low of $27 per barrel in 18 months, before starting to rebound. In the process, a slew of oil-and-gas drillers filed for bankruptcy. For a while it looked like the shale boom, where all the growth in production had come from, was running out of money, and therefore out of fuel. Production fell sharply from early 2015 through much of 2016, but then new money from Wall Street appeared, and production began to soar again, hitting new records all along the way.


Shale wells produce a variety of liquid hydrocarbons (they also produce gaseous hydrocarbons which are not included here). This production of crude oil and petroleum products soared from just over 7 million barrels per day (bpd) in 2010 to 16.6 million bpd currently, according to EIA data:

P The US used to be the largest net importer of crude oil and petroleum products in the world. Between 2005 and 2008, “net imports” (imports minus exports) of crude oil and petroleum products exceeded 12 million bpd. But surging production in the US has slashed imports. And recently exports have surged, and the trade in crude oil and petroleum products is now nearly balanced between the US and the rest of the world. And the net imports are heading toward zero – the point where the US imports as much as it exports. In February, net imports were down to just 176,000 barrels a day, the lowest in the EIA data going back to 1971. In March, the most recent data available, net imports were 842,000 barrels a day:

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“We have a stability and growth pact that focuses on stability and not on growth. We want to invert this order..”

Defiant Italy Urges Changes To EU Rules (R.)

Italy’s prime minister defied European Union concern over its debt on Thursday, saying the bloc’s fiscal rules should focus on growth rather than stability, and blaming partners for unfair tax competition and excessive surpluses. Arriving at a meeting of European leaders in Brussels, Giuseppe Conte dismissed warnings over Rome’s growing debt and said Italy was complying with EU fiscal rules. “We have a stability and growth pact that focuses on stability and not on growth. We want to invert this order,” Conte told reporters. Under current rules, EU states with large public debts should gradually reduce them, but Rome’s debt increased last year and is forecast to expand further until 2020.


Conte said the Italian government will complete the assessment of its finances in a meeting on Wednesday after which he expects new estimates to point to a 2019 deficit of around 2.1% of output, below the EU commission’s expectations. It is unclear, however, whether this would be enough for the EU Commission to stop a disciplinary procedure against Italy, which Brussels has said would be warranted on the basis of 2018 data and EU forecasts. [..] At the summit where EU leaders are discussing the bloc’s top jobs for the coming years, Conte echoed belligerent tones used by Italy’s deputy prime minister and far-right leader Matteo Salvini in attacking other EU members for unfair competition. He said there was something wrong in the fact that Italian firms relocate to other EU states for tax reasons – a probable reference to low corporate levies and lenient regulatory approaches in places like Luxembourg, the Netherlands or Ireland.

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“..you are not big enough to have an important position, important enough on the world stage, on your own.”

UK Will Be ‘Diminished’ After Brexit – Dutch PM Rutte (Pol.eu)

No U.K. prime minister would be able to mitigate the economic impact of Brexit on Britain or sustain its global power outside of the EU, especially after a no-deal exit, Dutch Prime Minister Mark Rutte warned Conservative leadership candidates today. Speaking ahead of the European Council summit in Brussels, he told BBC Radio 4’s “Today” program this morning: “With a hard Brexit — even with a normal Brexit — the U.K. will be a different country. It will be a diminished country. “It is unavoidable. Because you are not any longer part of the European Union and you are not big enough to have an important position, important enough on the world stage, on your own.”

The leader of the Netherlands, who described himself as an “Anglophile,” also said the next occupant of Downing Street must be clear about what they want from the EU if they aim to modify the so-called Political Declaration on the future relationship between the two sides; however he ruled out any reopening of the Withdrawal Agreement struck by outgoing British premier Theresa May. He dismissed claims by leadership hopeful Boris Johnson that the U.K. could be granted a Brexit transition period after a no-deal departure. “As Boris Johnson would say, Brexit is Brexit, and a hard Brexit is a hard Brexit,” Rutte said. “I don’t see how you can sweeten that.”

Home Secretary and Johnson’s rival Sajid Javid’s claim that he could renegotiate the controversial backstop plan directly with Dublin also got short shrift from Rutte, who said Ireland is an integral part of the EU and “we cannot have a backdoor” to the single market. Both Johnson and Javid have vowed to take Britain out of the EU, deal or no deal, by the current deadline of October 31 if they fail to renegotiate the exit plan with Brussels before then. The Dutch leader warned that any no-deal departure would be “chaos.” He said if a new British PM wanted an extension to continue negotiating on Brexit, something Environment Secretary Michael Gove has proposed, they would have to be clear about “making changes to the red lines the U.K. is currently holding.”

Read more …

Will the courts dare turn against Lenin Moreno?

Ecuador Judge Frees Ola Bini, Swedish Programer Close To Assange (R.)

An Ecuadorean judge on Thursday ordered that a Swedish citizen and personal friend of WikiLeaks founder Julian Assange be freed, two months after he was detained for alleged participation in a hacking attempt on the government. But Ola Bini, a 36-year-old software developer who has lived in Ecuador for five years, remains under investigation in the case and will be barred from leaving the country, according to the court ruling. Bini was detained in April at the Quito airport before boarding a flight to Japan, hours after Ecuador withdrew asylum for Assange, who had lived at its London embassy for almost seven years while facing spying charges related to WikLeaks’ 2010 publication of secret U.S. diplomatic cables.


Ecuador’s Interior Minister Maria Paula Romo had accused him of seeking to destabilize the Andean country’s government and compromising its national security. Bini has denied those allegations, but has acknowledged being close to Assange. “His right to freedom was violated,” judge Patricio Vaca said, reading the Thursday court ruling. “We accept the habeas corpus action proposed by the Swedish citizen Ola Bini, who can be immediately freed.” Bini worked at the Quito-based Center for Digital Autonomy, an organization focusing on cybersecurity and data privacy. His lawyer, Carlos Soria, told journalists on Thursday that he would ask “international courts” to determine any “prejudice” to the case that may have resulted from his arrest. “We will take actions against everyone because the court has determined that his detention was arbitrary. Now they will have to pay,” Soria said. “We will demonstrate Ola Bini’s innocence.”

Read more …

Better do it fast.

Ten Cities Ask EU For Help To Fight Airbnb Expansion (G.)

Ten European cities have demanded more help from the EU in their battle against Airbnb and other holiday rental websites, which they argue are locking locals out of housing and changing the face of neighbourhoods. In a joint letter, Amsterdam, Barcelona, Berlin, Bordeaux, Brussels, Krakow, Munich, Paris, Valencia and Vienna said the explosive growth of global short-stay lettings platforms must be on the agenda of the next set of European commissioners. In April the advocate general of the European court of justice found in non-binding opinion that under EU law Airbnb should be considered a digital information provider rather than a traditional real estate agent.

That status, if confirmed by the court, would allow Airbnb and similar platforms to operate freely across the bloc and, crucially, relieve them of any responsibility to ensure that landlords comply with local rules aimed at regulating holiday lets. European cities believe homes should be used first and foremost for living in, the cities said in a statement released by Amsterdam city council. Many suffer from a serious housing shortage. Where homes can be rented out more lucratively to tourists, they vanish from the traditional housing market. The cities said local authorities must be able to counter the adverse effects of the boom in short-term holiday lets, such rising rents for full-time residents and the continuing touristification of neighbourhoods, by introducing their own regulations depending on the local situation .

“We believe cities are best placed to understand their residents needs”, they said. “They have always been allowed to regulate local activity through urban planning and housing rules. The advocate general seems to imply this will no longer be possible when it comes to internet giants”. After several years of strong growth, Airbnb currently has more than 18,000 listings in Amsterdam and Barcelona, 22,000 in Berlin and nearly 60,000 in Paris. Data from the campaign group InsideAirbnb last year suggested that more than half were whole apartments or houses, and that even in cities where short-term lets were restricted by local authorities, up to 30% were available for three or more months a year.

Many cities say the short-term holiday lettings boom is contributing to soaring long-term rents, although speculation and poor social housing provision are also factors. Last year Palma de Mallorca voted to ban almost all listings after a 50% increase in tourist lets was followed by a 40% rise in residential rents.

Read more …

The Big Burp.

The Dangerous Methane Mystery (CP)

The East Siberian Arctic Shelf (“ESAS”) is the epicenter of a methane-rich zone that could turn the world upside down. Still, the ESAS is not on the radar of mainstream science, and not included in calculations by the IPCC (Intergovernmental Panel on Climate Change), and generally not well understood. It is one of the biggest mysteries of the world’s climate puzzle, and it is highly controversial, which creates an enhanced level of uncertainty and casts shadows of doubt. The ESAS is the most extensive continental shelf in the world, inclusive of the Laptev Sea, the East Siberian Sea, and the Russian portion of the Chukchi Sea, all-in equivalent to the combined landmasses of Germany, France, Great Britain, Italy and Japan.

The region hosts massive quantities of methane (“CH4”) in frozen subsea permafrost in extremely shallow waters, enough CH4 to transform the “global warming” cycle into a “life-ending” cycle. As absurd as it sounds, it is not inconceivable. Ongoing research to unravel the ESAS mystery is found in very few studies, almost none, except by Natalia Shakhova (International Arctic Research Center, University of Alaska/Fairbanks) a leading authority, for example: “It has been suggested that destabilization of shelf Arctic hydrates could lead to large-scale enhancement of aqueous CH4, but this process was hypothesized to be negligible on a decadal–century time scale. Consequently, the continental shelf of the Arctic Ocean (AO) has not been considered as a possible source of CH4 to the atmosphere until very recently.”


[..] early-stage warning signals are clearly noticeable; ESAS is rumbling, increasingly emitting more and more CH4, possibly in anticipation of a “Big Burp,” which could put the world’s lights out, hopefully in another century, or beyond, but based upon a reading of her latest report in Geosciences, don’t count on it taking so long. Shakhova’s research is highlighted in a recent article in Arctic News: “When Will We Die?” d/d June 10, 2019, which states: “Imagine a burst of methane erupting from the seafloor of the Arctic Ocean that would add an amount of methane to the atmosphere equal to twice the methane that is already there.”

Read more …

 

 

 

 

May 272019
 
 May 27, 2019  Posted by at 9:19 am Finance Tagged with: , , , , , , , , , , ,  8 Responses »


Pablo Picasso Landscape 1928

 

Europe’s Biggest Blocs Lose Grip On Power (BBC)
Centrist Bloc Loses Majority In EU (CNBC)
UK Tories And Labour Savaged As Voters Take Brexit Revenge (G.)
Nigel Farage Demands A Seat At Brexit Talks (R.)
US Efforts To Jail Assange For Espionage Grave Threat To Media (Rusbridger)
S&P 500 Would Be 19% Lower Between 2011 And Q1 2019 Without Buybacks (CNBC)
Fiat Chrysler Puts Merger Offer To Renault Board (R.)
China’s Small Bank Bailouts Duck Bankruptcy Test (R.)
US Army Twitter Question Highlights Toll Of America’s Wars (AFP)
Peru, Colombia, Ecuador And Bolivia Denounce Decision On Amazon Domain (R.)
World’s Rivers ‘Awash With Dangerous Levels Of Antibiotics’ (G.)

 

 

They’ve managed to fool people into thinking this has relevance. Both big blocks lose bigly, but they will still deliver Juncker’s successor. And the Commission decides the big issues. Yawn.

Europe’s Biggest Blocs Lose Grip On Power (BBC)

The big centre-right and centre-left blocs in the European Parliament have lost their combined majority amid an increase in support for liberals, Greens and nationalists. The centre-right European People’s Party remains the largest bloc, and is expected to form a pro-EU coalition. The Liberals and Greens had a good night, while nationalists were set for victory in Italy and France. Turnout was the highest for 20 years, bucking decades of decline. Populists gained ground in some countries but fell short of the very significant gains some had predicted.


In the UK, the newly-formed Brexit Party claimed a big victory, and a strong performance by the Liberal Democrats came amid massive losses for the Conservatives and Labour. Analysts said the EPP was likely to form a “grand coalition” with the Socialists and Democrats bloc, with support from the Liberals and Greens. The turnout bucked a long trend of decline in voter numbers, rising to just under 51% of eligible voters across the 28 member states.

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751 overpaid lackeys.

Centrist Bloc Loses Majority In EU (CNBC)

The EU Parliament will be much more fragmented over the next five years with the established centrist bloc set to fall short of securing a majority at this week’s election, early results show. The current projection from the European parliament is that center-right and center-left blocks will end up with a total of 329 seats out of 751.The lack of a majority for the centrist bloc — the center-right European People’s Party (EPP) and the center-left Socialist and Democrats (S&D) which has held power in Brussels for several decades — could further complicate decision-making at the European Union.


Pro-EU parties will hold onto two-thirds of the seats at the EU Parliament, but their nationalist opponents have also produced solid results. Italy’s anti-immigration Lega party has reportedly secured 28 seats, essentially doubling its level of national support. Euroskeptic groups in France and the U.K. look to have held the gains they saw in 2014 but that said, the results on Monday morning suggested a strong showing for Liberal and Green parties.

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Time for Corbyn to leave.

Fun: both sides, remain and leave, claim that overall, they won.

UK Tories And Labour Savaged As Voters Take Brexit Revenge (G.)

An insurgent Brexit party and reinvigorated Liberal Democrats have delivered a harrowing night for the Conservatives and Labour at the European elections, prompting profound soul-searching at the top of both major parties. Nigel Farage’s Brexit party humiliated the Conservatives in their rural heartlands but also made sweeping gains in cities such as Cardiff, Leeds and Sheffield, as well as in Hillingdon, the home of Boris’ Johnson’s seat where the Tories were pushed into fourth. Farage’s success campaigning in favour of a no deal Brexit is likely to push the Conservative leadership candidates into hardline positions on leaving the EU.

Jeremy Hunt, the foreign secretary, warned the Conservative were facing an “existential threat”, while Johnson said it was a “crushing rebuke” to the government’s failure to take the UK out of the EU. The night also confirmed an extraordinary revival of the Lib Dems, who overtook the Tories in Theresa May’s Maidenhead seat and came first in Jeremy Corbyn’s north London home of Islington. Overnight, the Brexit party gained 28 seats, with the Lib Dems in second on 15 seats. Labour held 10, having lost seven so far, the Green party won seven, a gain of four, and the Tories were languishing in fifth place, with just three seats.


The results so far show that the hard Brexit vote totalled 34.9% – with the Brexit party on 31.6% and Ukip on 3.3%. The overall total for pro-leave parties was up at 44% including the Conservatives on a historically low 9.1%. The pro-remain vote added up to 40.3% – with the Lib Dems on 20.3%, the Greens on 12.1%, the SNP on 3.5%, Change UK on 3.4% and Plaid Cymru on 1%. Labour, which tried to appeal to both sides with a soft Brexit pitch or a possible confirmatory referendum, was on 14.1%.

Read more …

A Brexit now would lead to civil war. Don’t do it. Postpone.

Nigel Farage Demands A Seat At Brexit Talks (R.)

Nigel Farage demanded a seat at Brexit negotiations on Monday after his new party swept to victory in the United Kingdom’s European Parliament election, warning that he would turn British politics upside down if denied. Farage, a bombastic 55-year-old commodities broker-turned anti-establishment supremo, won by riding a wave of anger at the failure of Prime Minister Theresa May to take the United Kingdom out of the European Union. As May’s Conservative Party prepares to pick a new leader, Farage had a warning for the next prime minister: A say in the United Kingdom’s biggest decision since World War Two.


“We should be part of the team now, that’s pretty clear,” Brexit Party leader Farage told Reuters at an election count in the southern English city of Southampton. After repeated delays to Brexit, Farage said the United Kingdom had to leave the EU on Oct. 31, the current deadline for Britain’s parliament to agree an exit deal. Farage would prefer to leave without a deal. “If we don’t leave on that day, then you can expect the Brexit Party to repeat this kind of surprise in the next general election,” he said.

Read more …

Alan Rusbridger is the former editor of the Guardian that publishes Luke Harding’s smear pieces on Assange. But now it’s the very same Guardian that feels threatened.

US Efforts To Jail Assange For Espionage Grave Threat To Media (Rusbridger)

As editor of the Guardian, I worked with Assange when we jointly (along with newspapers in the US and Europe) published other material Manning had leaked. Vanity Fair called the resultant stories “one of the greatest journalistic scoops of the last 30 years… they have changed the way people think about how the world is run”. The stories were, indeed, significant – but the relationship with Assange was fraught. We fell out, as most people eventually do with Assange. I found him mercurial, untrustworthy and dislikable: he wasn’t keen on me, either. All the collaborating editors disapproved of him releasing unredacted material from the Manning trove in September 2011. Nevertheless, I find the Trump administration’s use of the Espionage Act against him profoundly disturbing.


The Espionage Act was a panic measure enacted by Congress to clamp down on dissent or “sedition” when the US entered the First World War in 1917. In the subsequent 102 years it has never been used to prosecute a media organisation for publishing or disseminating unlawfully disclosed classified information. Nobody prosecuted under the act is permitted to offer a public interest defence. Whatever Assange got up to in 2010-11, it was not espionage. Nor is he a US citizen. The criminal acts this Australian maverick allegedly committed all happened outside the US. As Joel Simon, director of the Committee to Protect Journalists, has observed: “Under this rubric, anyone anywhere in the world who publishes information that the US government deems to be classified could be prosecuted for espionage.”

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Lowballing.

S&P 500 Would Be 19% Lower Between 2011 And Q1 2019 Without Buybacks (CNBC)

Buybacks have gotten a bad rap from both Republican and Democratic lawmakers this year. But the stock market would be trading at a much lower level without them. Data compiled by Ned Davis Research shows the S&P 500 would be 19% lower without buybacks. The firm looked at the S&P 5002 s performance between the first quarter of 2011 and the first three months of 2019. Then they subtracted the amount of net monthly repurchases to arrive to that conclusion. The broad market is up more than 125% in that time while net buybacks have totaled about $3.5 trillion. “Without focusing too much on numbers, we can say that the S&P 500 index would probably be lower today if not for buybacks versus other uses of cash”, Ed Clissold, chief U.S. strategist at Ned Davis Research, wrote in a note last month.

Lawmakers on both sides are bashing buybacks and want to make it harder for companies to repurchase their own stock. They argue that buybacks inflate corporate executives’ pay and share price at the expense of a company’s workers. In a Feb. 20 Medium post, Sen. Charles Schumer, D-NY, said companies should reinvest their capital differently. Earlier in February, Schumer and Sen. Bernie Sanders, I-VT — a presidential hopeful — proposed in a New York Times op-ed that companies should provide living wages and health benefits to workers if a buyback program is launched. “At a time of huge income and wealth inequality, Americans should be outraged that these profitable corporations are laying off workers while spending billions of dollars to boost their stock’s value to further enrich the wealthy few, ” the senators wrote in the op-ed.

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Still owned by governments, for Pete’s sake. What year is this?

Fiat Chrysler Puts Merger Offer To Renault Board (R.)

Fiat Chrysler has made a “transformative” merger proposal to Renault, the Italian-American carmaker said, in a deal that would create a new third-ranked global manufacturer. The proposal, finalised in overnight talks with Renault, was being discussed at a meeting of the French group’s board early on Monday. The deal would create a carmaker selling 8.7 million vehicles annually with a strong presence across key regions, automotive markets and technologies, FCA said. It would generate 5 billion euros ($5.6 billion) in estimated annual savings. The “broad and complementary brand portfolio would provide full market coverage, from luxury to mainstream,” it added.

If successful, the FCA-Renault tie-up would alter the competitive landscape for rival carmakers from General Motors to Peugeot maker PSA Group, which recently held inconclusive talks with FCA. It could also have profound repercussions for Renault’s 20-year-old alliance with Nissan, already weakened by the crisis surrounding the arrest and ouster of former chairman Carlos Ghosn late last year. The FCA-Renault plan would see the two carmakers merged under a listed Dutch holding company. After payment of a 2.5 billion-euro dividend to current FCA shareholders, each investor group would receive 50 percent of stock in the new company.


[..] The French government, Renault’s biggest shareholder with a 15% stake, supports the merger in principle but will need to see more details, its main spokeswoman said on Monday. France will be “particularly vigilant regarding employment and industrial footprint,” another Paris official said – adding that any deal must safeguard Renault’s alliance with Nissan, which had recently rebuffed a merger proposal from the French carmaker. The Italian government may also seek a stake in the combined group to balance France’s holding, a lawmaker from the ruling League party said on Monday. [..] Nissan, which is 43.4%-owned by Renault, would be invited to nominate a director to the 11-member board of the new combined company, under the plan presented on Monday.

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“Shanghai’s Pudong Development Bank was fined for using 1,493 shell companies to hide non-performing loans.”

China’s Small Bank Bailouts Duck Bankruptcy Test (R.)

China is ducking a bankruptcy test. Baoshang Bank, linked to missing billionaire Xiao Jianhua, has been brought under state control. Despite threats, Beijing remains wary of allowing even disgraced local lenders to fail. Interest in Baoshang, based in Inner Mongolia, comes thanks to its colourful history. Its biggest stakeholder – and a major borrower – was Tomorrow Holdings, run by Xiao until he vanished in 2017 from a Hong Kong hotel. The insurance conglomerate’s assets are now being sold off piecemeal. Rickety municipal lenders are common in China, even if Baoshang is more precarious than most: a 2018 analysis by Jason Bedford of UBS named Baoshang as one of a trio of lenders with Tier 1 capital adequacy ratios below 8 percent, the lowest in his national survey.


City banks held just 13% of total assets in the first quarter of 2019, and rural lenders another 7%, but they represent an outsize share of the country’s financial risk. As the state giants attract the best, government-guaranteed clients, small fry make do with the rest, which means more duff debt. Ruses to cover up the damage are not uncommon: in 2018, Shanghai’s Pudong Development Bank was fined for using 1,493 shell companies to hide non-performing loans. Other lenders, like Bank of Dalian, have been bailed out repeatedly. The People’s Republic rolled out a deposit protection scheme in 2015. This theoretically allows poorly run banks to collapse without hurting ordinary depositors. But work is still in progress. The national insurance fund had only $12 billion at the end of September, and officials were still talking about creating an implementation agency in March.

Read more …

What did the army expect would happen?

US Army Twitter Question Highlights Toll Of America’s Wars (AFP)

Days ahead of an annual holiday when Americans remember those who died while serving in the armed forces, the US Army’s Twitter account asked people how their time in the military affected them and received an outpouring of grief. The question drew some 10,000 replies since it was posted late last week — many of which were anonymous or included details that could not be independently confirmed, but which paint a harrowing picture of the toll America’s wars have taken on those who fought them. “OEF, OIF ptsd with chronic pain,” one Twitter user wrote, using the US military’s acronyms for the wars in Afghanistan and Iraq, and the abbreviation for Post-Traumatic Stress Disorder. The US launched the war in Afghanistan in 2001 and the Iraq war in 2003.


The conflicts left thousands of American service members dead and many more wounded. US troops are still deployed in both countries to this day. “My dad came back from fighting in Iraq and was abusive, constantly angry, paranoid, and following that went through a lot of therapy but his mental and physical health are still off and he was definitely changed through all he had been through,” another user wrote. “My son served and did one tour of OEF, he made it back, re-enlisted, and shot himself in the head,” said another. “The ‘Combat Cocktail’: PTSD, severe depression, anxiety. Isolation. Suicide attempts. Never ending rage. It cost me my relationship with my eldest son and my grandson. It cost some of my men so much more,” another Twitter user wrote. “How did serving impact me? Ask my family.”

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Priorities. Question should be: which came first?

Peru, Colombia, Ecuador And Bolivia Denounce Decision On Amazon Domain (R.)

The presidents of Peru, Colombia, Ecuador and Bolivia criticized a recent decision by the organization that manages internet protocol to grant global retailer Amazon Inc the rights to the .amazon domain. Amazon Inc has been seeking the exclusive rights to the .amazon domain name since 2012. But Amazon basin countries – including Peru, Colombia, Ecuador and Bolivia – have argued it refers to their geographic region and should not be the monopoly of one company. The four leaders – Peru’s Martin Vizcarra, Colombia’s Ivan Duque, Ecuador’s Lenin Moreno and Bolivia’s Evo Morales – vowed to join forces to protect their countries from what they described as inadequate governance of the internet.


Last week, the global Internet Corporation for Assigned Names and Numbers (ICANN), which oversees internet addresses, said it decided to proceed with the designation requested by Amazon Inc pending a 30-day period of public comment. The decision sets “a grave precedent by prioritizing private commercial interests above the considerations of state public policies, the rights on indigenous people and the preservation of the Amazon,” Vizcarra, Duque, Moreno and Morales said in a joint statement on Sunday after a gathering in Lima of the Andean Community regional bloc. They added that Latin American and Caribbean countries agreed in 2013 to reject any attempt to appropriate the Amazon name or any other name that refers to geography, history, culture or nature without the consent of countries in the region.

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Intelligent species.

World’s Rivers ‘Awash With Dangerous Levels Of Antibiotics’ (G.)

Hundreds of rivers around the world from the Thames to the Tigris are awash with dangerously high levels of antibiotics, the largest global study on the subject has found. Antibiotic pollution is one of the key routes by which bacteria are able develop resistance to the life-saving medicines, rendering them ineffective for human use. “A lot of the resistance genes we see in human pathogens originated from environmental bacteria,” said Prof William Gaze, a microbial ecologist at the University of Exeter who studies antimicrobial resistance but was not involved in the study. The rise in antibiotic-resistant bacteria is a global health emergency that could kill 10 million people by 2050, the UN said last month.


The drugs find their way into rivers and soil via human and animal waste and leaks from wastewater treatment plants and drug manufacturing facilities. “It’s quite scary and depressing. We could have large parts of the environment that have got antibiotics at levels high enough to affect resistance,” said Alistair Boxall, an environmental scientist at the University of York, who co-led the study. The research, presented on Monday at a conference in Helsinki, shows that some of the world’s best-known rivers, including the Thames, are contaminated with antibiotics classified as critically important for the treatment of serious infections. In many cases they were detected at unsafe levels, meaning resistance is much more likely to develop and spread.

Read more …

 

Don’t think I ever heard of this girl until recently. She’s haunting.

 

 

 

 

May 012019
 


Gustave Courbet The desperate man (self portrait) 1852

 

Maduro Claims Victory Over ‘Deranged’ Coup Attempt (G.)
Zero Percent of Elite Commentators Oppose Regime Change in Venezuela (FAIR)
About That Letter That Mueller Wrote To Barr… (ZH)
The Real ‘Bombshells’ Are About to Hit Their Targets (Kelly)
Why Are Clapper and Brennan Not in Jail?
Wall Street Puts Nearly $2 Billion in American Politics in 2016-18 Cycle
iPhone Sales Fall 17% In First Quarter (G.)
Australia House Prices Continue To Fall, Clearing Way For Rate Cut (SMH)
Tesla Filing Shows Results Were Goosed By A Surge In Credits (LAT)
Julian Assange’s Confinement And Arrest Are A Scandal (Maurizi)
Extradition of Julian Assange Threatens Us All (VIPS)
Canadian Threat Level At America Raised From “Miffed” To “Peeved” (Exp.)
Climate Crisis Facing Australian Rainforests Likened To Coral Bleaching (SMH)

 

 

The things we do for oil.

“‘Maduro had a plane on the tarmac and was ready to leave this morning’, claims @SecPompeo without offering evidence. But as Pompeo admitted just last week, telling lies was (and some may say still is) one of his key job requirements”.

Maduro Claims Victory Over ‘Deranged’ Coup Attempt (G.)

Nicolás Maduro claimed his troops have thwarted a botched attempt to topple him masterminded by Venezuela’s “coup-mongering far right” and Donald Trump’s deranged imperialist “gang”. In an hour-long address to the nation on Tuesday night – his first since the pre-dawn uprising began – Maduro accused opposition leader Juan Guaidó and his political mentor Leopoldo López of seeking to spark an armed confrontation that might be used as a pretext for a foreign military intervention. However, “loyal and obedient” members of Venezuela’s Bolivarian armed forces had put down the mutiny within hours of it starting shortly after 4am, Maduro claimed, in direct contradiction to Guaidó’s earlier remark that the president no longer had military backing.

By noon there only remained a small group of plotters who had chosen “the path of betrayal … [and] handed their souls over to the coup-mongering far right”. “They failed in their plan. They failed in their call, because the people of Venezuela want peace,” Maduro said, surrounded by Venezuela’s military and political elite. “We will continue to emerge victorious … in the months and years ahead. I have no doubt about it.” Maduro said the plotters would “not go unpunished” and said they would face criminal prosecutions “for the serious crimes that have been committed against the constitution, the rule of law and the right to peace”.


[..] Maduro called Tuesday’s “coup-mongering adventure” part of a US-backed plot to destroy the Bolivarian revolution he inherited after Hugo Chávez’s death in 2013. “I truly believe … that the United States of America has never had a government as deranged as this one,” he said, calling Guaidó and his team “useful idiots” of the empire. He also scotched claims from the US secretary of state, Mike Pompeo, that he had been preparing to flee Venezuela for Cuba on Tuesday morning, until he was told to stay put by his Russian backers. “Señor Pompeo, please,” Maduro said.

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Propaganda works.

Zero Percent of Elite Commentators Oppose Regime Change in Venezuela (FAIR)

A FAIR survey of US opinion journalism on Venezuela found no voices in elite corporate media that opposed regime change in that country. Over a three-month period (1/15/19–4/15/19), zero opinion pieces in the New York Times and Washington Post took an anti–regime change or pro-Maduro/Chavista position. Not a single commentator on the big three Sunday morning talkshows or PBS NewsHour came out against President Nicolás Maduro stepping down from the Venezuelan government. Of the 76 total articles, opinion videos or TV commentator segments that centered on or gave more than passing attention to Venezuela, 54 (72 percent) expressed explicit support for the Maduro administration’s ouster.

Eleven (14 percent) were ambiguous, but were only classified as such for lack of explicit language. Reading between the lines, most of these were clearly also pro–regime change. Another 11 (14 percent) took no position, but many similarly offered ideological ammo for those in support. The Times published 22 pro–regime change commentaries, three ambiguous and five without a position. The Post also spared no space for the pro-Chavista camp: 22 of its articles expressed support for the end to Maduro’s administration, eight were ambiguous and four took no position. Of the 12 TV opinions surveyed, 10 were pro-regime change and two took no position.


[..] This comes despite the existence of millions of Venezuelans who support Maduro—who was democratically elected twice by the same electoral system that won Juan Guaidó his seat in the National Assembly—and oppose US/foreign intervention. FAIR (2/20/19) has pointed out corporate media’s willful erasure of vast improvements to Venezuelan life under Chavismo, particularly for the oppressed poor, black, indigenous and mestizo populations. FAIR has also noted the lack of discussion of US-imposed sanctions, which have killed at least 40,000 Venezuelans between 2017–18 alone, and continue to devastate the Venezuelan economy.

Read more …

Mueller worried about media coverage.

“House Democrats, who have expressed distrust in the attorney general, are set to vote on Wednesday to allow House Judiciary Committee lawyers to question Barr at Thursday’s hearing.”

About That Letter That Mueller Wrote To Barr… (ZH)

In what the WaPo breathlessly reports late on Tuesday was a rebuke and “complaint” to Attorney General William Barr, special counsel Robert Mueller sent a letter to the AG in late March, just days after Barr sent out his summary to Congress, in which Mueller stated that Barr’s 4-page summary to Congress on the sweeping Russia investigation failed to “fully capture the context, nature, and substance” of Mueller’s work and conclusions, citing a copy of the letter it had obtained using its trusted deep intel sources. Pouring more fuel on the fire, the always pithy Axios adds that “this revelation about Mueller’s dissatisfaction with the characterization of his report will likely escalate the growing rift over Barr’s handling of the special counsel’s investigation.

[..] Or maybe not, and perhaps the WaPo/NYT report is not “so bad” if one actually reads it, because once the breathless WaPo finally does come up for air, we get to paragraph 13 – a point by which most readers have turned out – to read the following real punchline in the WaPo report: “When Barr pressed Mueller on whether he thought Barr’s memo to Congress was inaccurate, Mueller said he did not…” So, Mueller felt there was confusion… but he did not think the memo was inaccurate. Wait, what’s going on here and how is this even a story? Well, if we read the rest of the above sentence, we find the true object of Mueller’s “complaint”: “[Mueller] felt that the media coverage of it was misinterpreting the investigation, officials said.”

Which means that, as the WaPo itself reports, what Mueller was really angry with was the coverage of his report by media such as… the WaPo and the NYT?? The irony, it burns. [..] throughout a subsequent 15 minutes telephone conversation between the special counsel and the attorney general, Mueller’s main worry was “that the public was not getting an accurate understanding of the obstruction investigation.” This goes back to what Mueller’s letter requested: “that Barr release the 448-page report’s introductions and executive summaries, and made some initial suggested redactions for doing so, according to Justice Department officials,” the WaPo writes. What happened then? A few weeks later Barr did just that..

[..] tomorrow Barr is scheduled to testify on Wednesday before the Senate Judiciary Committee about the investigation, and the entire article is meant to focus on the headlines of the WaPo (and NYT) article, and certainly not on paragraph 13 which, not only refutes the prevailing tone that Barr did something wrong, but in fact exonerates him. But that won’t have any impact on tomorrow’s hearing which is now assured to be a complete kangaroo court.

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FISAgate. Get ready.

The Real ‘Bombshells’ Are About to Hit Their Targets (Kelly)

In the next several weeks, Inspector General Michael Horowitz is expected to issue his summation of the potential abuse of the Foreign Intelligence Surveillance Act by top officials in the Obama Administration and holdovers in the early Trump Administration who were overseeing the investigation of Donald Trump’s presidential campaign. And the perpetrators of the so-called FISAgate scandal now are scrambling for cover as the bad news looms. Horowitz announced last March that his office would examine the Justice Department’s conduct “in applications filed with the U.S. Foreign Intelligence Surveillance Court (FISC) relating to a certain U.S. person.” That U.S. person is Trump campaign associate Carter Page.

In October 2016, just two weeks before the presidential election, the Justice Department submitted an application to the FISC seeking authorization to wiretap Page. The court filing accused Page, a Naval Academy graduate and unpaid campaign advisor, of being an agent of Russia. The application cited the infamous Steele dossier—unsubstantiated political propaganda that had been funded by the Hillary Clinton campaign and Democratic National Committee—as its primary source of evidence. But the specific political origin of the dossier intentionally was omitted in the court filing. (Robert Mueller similarly tap danced around the role of Fusion GPS, the political consulting firm that hired Christopher Steele to create the dossier. Mueller never mentioned the name “Fusion GPS” in the 448-page document, referring to it only vaguely as “the firm that produced the Steele reporting.”)


Former FBI Director James Comey and former Deputy Attorney General Sally Yates signed the original FISA application. It was renewed three times; subsequent signers included former acting FBI Director Andrew McCabe and Deputy Attorney General Rod Rosenstein. If there’s one document that represents the malevolence, chicanery and arrogance of the original Trump-Russia collusion fraudsters, it’s the Page FISA application. But—to borrow a favorite term of the collusion truthers—the “walls are closing in” on the FISA abusers.

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Senator Rand Paul: “Subpoena Clapper & Brennan! Demand they answer whether they leaked classified information to the Washington Post. Examine their call records and lock them up if evidence proves them to be the leakers.”

Why Are Clapper and Brennan Not in Jail?

The clearest of all the laws concerning U.S. intelligence is Section 798, 18 U.S. Code—widely known in the Intelligence Community as “the Comint Statute,” or “the 10 and 10.” Unlike other laws, this is a “simple liability” law. Motivation, context, identity, matter not at all. You violate it, you are guilty and are punished accordingly.

Here it is: (a) Whoever knowingly and willfully communicates, furnishes, transmits, or otherwise makes available to an unauthorized person, . . . any classified information— (1) concerning the nature, preparation, or use of any code, cipher, or cryptographic system of the United States or any foreign government; or (2) concerning the design, construction, use, maintenance, or repair of any device, apparatus, or appliance used or prepared or planned for use by the United States …or (3) concerning the communication intelligence activities of the United States or any foreign government; or (4) obtained by the processes of communication intelligence . . . Shall be fined under this title or imprisoned not more than ten years, or both.


On December 9 and 10, 2016, the New York Times and the Washington Post independently reported that anonymous senior intelligence officials had told them that, based on intercepted communications, the intelligence agencies agreed that Russia had hacked the Democratic National Committee to help Donald Trump win the election. Their evidence was the fact of their access to U.S communications intelligence. A flood of subsequent stories also cited allegations by “senior intelligence officials” that “intercepted communications” and “intercepted calls” showed that “members of Donald J. Trump’s 2016 presidential campaign and other Trump associates had repeated contacts with senior Russian intelligence officials in the year before the election.” Incontrovertibly, the officials who gave these stories to the Times and Post violated the Comint Statute, and are subject to the “10 and 10” for each count.

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$2.5 million every single day for two years. That’s $1.9 billion.

Wall Street Puts Nearly $2 Billion in American Politics in 2016-18 Cycle

Wall Street poured at least $1.9 billion into the political process, the largest-ever amount for a non-presidential year, according to a new report by Americans for Financial Reform. This sum outstrips the total of $1.4 billion, in the 2013-14 election cycle, by 36 percent. The figure, which includes contributions to campaign committees and leadership PACs ($922 million) and lobbying expenditures ($957 million), reflects a massive rush of pro-industry nominees and legislation over the last two years, at a time when the biggest banks made $100 billion in profits for the first time. Industry subsequently spent heavily to influence what became one of the hardest-fought mid-term campaigns in decades.


“The last election cycle demonstrated yet again that Wall Street political spending produces policies that will do lasting financial damage to most Americans, including massive tax cuts for big banks, fewer consumer and investor protections, and other policies that that drive inequality and economic vulnerability,” said Lisa Donner, executive director, Americans for Financial Reform. “Year after year, big money in politics helps Wall Street rig the system in its own favor, and against the rest of us, and insulate itself from accountability, even though voters across party lines oppose so many of the policies it seeks.”

The 63-page report, “Wall Street Money in Washington,” draws on a special data set compiled by the Center for Responsive Politics for AFR in order to provide a more precise look at financial services industry spending. The set excludes spending by health insurers, who work to influence a different group of issues than, for example, banks. As the data does not include “dark money” that goes mostly unreported, the actual sums of Wall Street spending are surely much higher.

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So Apple buys back another $75 billion and shares rise 5%. But of course.

iPhone Sales Fall 17% In First Quarter (G.)

Apple’s iPhone sales fell 17% in the first three months of the year as the company’s flagship product continued to struggle. The tech company reported revenues of $31.05bn in iPhone revenues for the quarter, the majority of the $58.bn in revenues Apple brought in over the three months. The news was less gloomy than expected and Apple’s shares spiked 5% in after hours trading as Apple announced it was buying back another $75bn of its shares. The company made a profit of $11.6bn – ahead of expectations. But this quarter marked another quarterly decline in profit and revenue as the company struggled to move beyond the iPhone. In January Apple reported its first decline in revenues and profits in over a decade as slowing sales of iPhones and an economic slowdown in China took their toll.


Those results came after chief executive Tim Cook shocked investors by issuing Apple’s first profits warning since 2002 citing “the magnitude of the economic deceleration, particularly in greater China.” The company has stopped reporting unit sales of iPhones – leaving analysts searching other sources of data for their estimates. Most don’t expect a recovery in sales until the next generation of phones, using the super-fast 5G network, are launched, likely to be in 2020. In the meantime Apple is repositioning itself as a services and software company as well as the manufacturer of hardware. “Investors are slowly shifting their focus away from the iPhone cycle and valuing the company more based on the ecosystem of hardware, software, and services, but it will take several years for this to become consensus,” Gene Munster, managing partner of Loup Ventures, wrote in a blog post this week.

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Why? Maybe prices are far too high. Why would you want to keep them that way?

Australia House Prices Continue To Fall, Clearing Way For Rate Cut (SMH)

The national property market is enduring its biggest fall in values since the global financial crisis, being led down by double-digit drops in Sydney and Melbourne. New analysis by CoreLogic shows house values in Sydney dropped 0.8 per cent in April to be down by 11.8 per cent over the past 12 months. The situation is worse in Melbourne where values fell by 0.7 per cent last month to be down 12.6 per cent over the past year. Overall dwelling values in Sydney dropped by 0.7 per cent to be 10.9 per cent lower over the year. Since their peak in September 2017, Sydney dwelling values have fallen by 14.5 per cent.


In Melbourne, dwelling values dropped by 2.6 per cent to be 10 per cent down over the past 12 months. They have fallen by 10.9 per cent since their peak. National dwelling values were down by 0.5 per cent in the month to be down by 7.2 per cent on an annual basis, the largest drop since the 12 months to February 2009. Every capital city except Canberra suffered a fall in house prices last month with Hobart, which had been the nation’s strongest market, seeing a 1.2 per cent drop in April. Canberra, where values lifted last month, and Hobart are the only two capitals where prices are still growing above the inflation rate on an annual basis.

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Subsidies “R” Us.

Tesla Filing Shows Results Were Goosed By A Surge In Credits (LAT)

Tesla’s financial results released last week didn’t mention that the automaker’s revenue included $200 million collected from regulatory credits. When Chief Executive Elon Musk answered questions from analysts, he didn’t point that out, either. The number was buried in the official government filing known as Form 10-Q that Tesla filed Monday with the Securities and Exchange Commission. Without the revenue spike – which is unlikely to be repeated, analysts say – the company’s first-quarter loss would have been much deeper than the $702 million that Tesla reported. Gross margins on Tesla’s cars, a key measure of manufacturing profitability and efficiency, would have taken a significant hit. Bernstein analyst Toni Sacconaghi’s reaction? “Egad,” he said in a note to investors.


Tesla’s shares fell 1.2% to $238.69 on Tuesday. The $235.14 closing price Friday was its lowest in more than two years. The new data add to Tesla’s already bleak financial picture. The $702-million loss followed a $139-million profit in the previous quarter. Sales fell sharply. Automotive revenue plunged 41%, to $3.7 billion from $6.3 billion in the previous quarter, as vehicle deliveries dropped to 63,000 from 90,700 the previous quarter. Operating cash flow turned negative — a net $640 million going out the door over the three months compared to a positive $1.23 billion in the previous period. Cash on hand dropped from $3.69 billion at the end of last quarter to $2.2 billion, including $920 million to pay off convertible bonds.

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“.. they replied to me and my lawyers that they had destroyed the emails, even though the case is still ongoing, very high-profile and controversial.”

Julian Assange’s Confinement And Arrest Are A Scandal (Maurizi)

In the summer of 2015, when Julian Assange had already spent three years inside the embassy, I decided it was important to access the full documentation on his case to try to reconstruct it using factual information. It was at that point that I filed my comprehensive FOIA request on the Julian Assange and WikiLeaks case in four jurisdictions. I ran up against a real rubber wall, one so persistent that have been forced to sue the Swedish and British authorities. The documents I have managed to obtain after a lengthy FOIA litigation, which is still ongoing, provide indisputable evidence of the UK’s role in helping to create the legal and diplomatic quagmire which has kept Julian Assange arbitrarily detained since 2010, as established by the United Nations Working Group on Arbitrary Detention (UNWGAD.)

It was the UK Crown Prosecution Service which advised the Swedish prosecutors against the only judicial strategy that could have brought the Swedish rape investigation to a quick closure: questioning Assange in London, rather than trying to extradite him to Stockholm. It was the Crown Prosecution Service which tried to dissuade the Swedish prosecutors from dropping the case in 2013. Why did the Crown Prosecution Service act this way? And why did the Crown Prosecution Service write to their Swedish counterpart: “Please do not think that the case is being dealt with as just another extradition request”?


When I tried to dig into these facts, I discovered crucial gaps in the Crown Prosecution Service’s documents and asked the Service to provide an explanation for them. Their answer was rather incredible: they replied to me and my lawyers that they had destroyed the emails, even though the case is still ongoing, very high-profile and controversial. The Crown Prosecution Service which destroyed the records is the very same agency in charge of handling the extradition request from the United States, as well as from Sweden, if the Swedish prosecutors reopen the case before the statute of limitations on the rape allegations expires. Will anyone demand transparency and accountability from the Crown Prosecution Service in their handling of the Assange case from the very beginning?

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“It takes two to speak the truth–one to speak and one to hear.”

Extradition of Julian Assange Threatens Us All (VIPS)

Retaliation against Julian Assange over the past decade plus replicates a pattern of ruthless political retaliationagainst whistleblowers, in particular those who reveal truths hidden by illegal secrecy. U.S. law prohibits classifying information “in order to conceal inefficiency, violations of law, or administrative error; to prevent embarrassmentto a person, organization, or agency.” Whether U.S. authorities successfully prosecute Assange, accept a desperate plea deal or keep him tied up with endless litigation, they will succeed in sending the same chilling message to all journalists that they send to potential whistleblowers: Do not embarrass us or we’ll punish you—somehow, someday, however long it takes.

In that respect, one could say damage to journalism already has been done but the battle is not over. This extension of a whistleblower reprisal regime onto a publisher of disclosures poses an existential threat to all journalists and to the right of all people to speak and hear important truths. The U.S. indictment of Julian Assange tests our ability to perceive a direct threat to free speech, and tests our will to oppose that threat.Without freedom of press and the right and willingness to publish, whistleblowers even disclosing issues of grave, life and death public safety, will be like a tree falling in the forest with no one to hear.


The great American writer Henry David Thoreau wrote, “It takes two to speak the truth–one to speak and one to hear.” Today, it takes three to speak the truth–one to speak, one to hear, and one to defend the first two in court. If the U.S. Government has its way, there will be no defense, no truth.

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Real title: “Canada FURY after The Simpsons MOCKS Justin Trudeau amid scandal – ‘COMPLETE disrespect’”

I don’t know what to think of this. You decide. Onion? It’s actually the Express in the UK.

Canadian Threat Level At America Raised From “Miffed” To “Peeved” (Exp.)

Viewers were left disgusted after the word “Newfie” was used in the episode titled ‘D’Oh Canada’. The term is decades old and is considered an offensive, derogatory term for people in Newfoundland and Labrador. According to CTV News, it is commonly used to imply someone is stupid or foolish. The country’s Prime Minister Justin Trudeau also appeared in the episode. During the episode, which aired on Sunday night, the Simpsons family travel to Niagara Falls. Somehow Lisa Simpson ends up falling over the famous waterfall, which separates the US and Canada. In the controversial scene, Lisa stands next to some Canadian youngsters and says: “I’m sure you treat all people equally.”


One says: “Except the Québécois,” before others add, “and the Newfies. “Stupid Newfies.” The scene then cuts to Springfield youngster Ralph Wiggum who says “I’m a Newfie” before clubbing the head of a stuffed baby seal. Twitter erupted with fury following the show’s airing. One said: “I can take a joke. “When, however, it is complete disrespect disguised as a joke, I take exception.” Some also criticised the show for targeting seal hunters. The Simpsons has a long and often contentious past. Most recently the show was condemned for its portrayal of Apu Nahasapeemapetilon, who many now see as racist stereotyping.

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On and on we go.

Climate Crisis Facing Australian Rainforests Likened To Coral Bleaching (SMH)

Animals in Australia’s globally renowned wet tropics are on the brink of extinction after the hottest summer on record, according to official advice that equates the scale of the crisis to coral bleaching on the Great Barrier Reef. The extraordinary warning relates to the lush green coastal fringe spanning Townsville, Cairns and Cooktown in Queensland’s north – the Earth’s oldest rainforest and a World Heritage-listed tourist drawcard. A statement from the board of the Wet Tropics Management Authority on Tuesday said more than half of animal species endemic to the area may be extinct within decades. It called for strong global action to reduce greenhouse gas emissions and protect the ancient area for future generations.


The climate change policies of the major parties are under the microscope during the federal election campaign, as Labor and the Coalition pledge starkly different action to address the crisis. The Queensland government authority says “concerning new evidence has shown an accelerating decline” in the wet tropics’ unique rainforest animals. “Following the hottest summer ever recorded, some of the key species for which the Wet Tropics World Heritage Area was listed are at imminent risk of extinction,” the statement said. [..] Modelling has previously predicted that more than half of the area’s endemic species may be extinct by the end of this century. However the latest findings by James Cook University biodiversity professor Steve Williams suggested “these extinctions are happening even sooner”, the statement said.

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Apr 262019
 


Francisco Goya The dummy 1791

 

Trump Has Just Taken The Biggest Economic Gamble Of His Presidency (AEP)
A Nation at War With Itself (Pat Buchanan)
Trump Attacks Democrat ‘Coup’ In 1st Post-Mueller Interview (RT)
US Is Investigating Assange Under Espionage Act – WikiLeaks (NP)
UN Special Rapporteur On Privacy Meets Assange In Prison: “I Will Act” (Maurizi)
Macron Responds To Gilets Jaunes Protests With €5 Billion Tax Cuts (G.)
Macron: Smaller Schengen Zone Because EU Migration Policies ‘Do Not Work’ (RT)
Irish Backstop Could Undermine EU Standards – Report (G.)
Juncker Refuses To Reject Huawei ‘Just Because It’s Chinese’ (RT)
Huawei Leak Highlights Collapse Of Discipline In May’s Cabinet (G.)
European Equities May Benefit As $1 Trillion In US Buybacks Vanish (ZH)
Universe Expands Faster Than Expected – NASA

 

 

Ambrose calls the depletion of Ghawar a “first-order shock”. Common knowledge though. Still, Trump may not be aware of it either if Ambrose isn’t.

Trump Has Just Taken The Biggest Economic Gamble Of His Presidency (AEP)

Donald Trump’s double strangulation of Iran and Venezuela is reducing spare capacity in the global oil markets to wafer-thin levels very fast. If anything goes wrong in the geopolitical cauldron of world energy over the next six months, we will discover whether Saudi Arabia really is capable of cranking up an extra 2 million barrels a day of crude. What we learnt from the rare glimpse of Saudi Aramco’s books this month is that the legendary Ghawar field is badly depleted. It cannot pump more that 3.8m barrels a day. This is a first-order shock. The company has always asserted with magisterial confidence that it can produce 5m barrels a day without difficulty.

Jean-Louis Le Mee, from Westbeck Capital, says the physical oil markets are on fire. They are heading for a supply deficit of 1.3m barrels a day by the third quarter even if OPEC matches every barrel of lost oil from Iran sanctions. “These numbers should have every investor worried,” he said. Global spare capacity is arguably as low today as it was during the great oil shocks of the last half century. We are skating on thin ice. The immediate wild card is renewed fighting in Libya but other supply problems are stacking up fast. Draconian new rules on shipping fuel to lower sulphur emissions imply a surge in demand for variants of diesel. Bank of America says this will add 1.1m barrels a day in short-term crude demand over coming months. “We see a risk of $US100 Brent by year-end,” it said.

The options markets are not priced for this so the theatrics could be spectacular. Libya is again on the cusp of full-blown civil war after the fateful march on Tripoli by general Khalifa Haftar, the mercurial Nasserist of Benghazi. The National Oil Corporation warns that a free-for-all by rival militias could cause a near total collapse in crude exports. The world could lose another 700,000 barrels a day. Brent crude has risen to a six-month high of $US74.50, up 25 per cent from its average levels over the winter. It has not yet reached the pain threshold for Europe or emerging markets but it is getting close. Oil has of course been much higher in the past – $US148 in 2008 – but the nominal price is not the macro-economic variable that matters. Trouble starts earlier if crude is rising because of a negative supply shock. That is what we face today.

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No, I haven’t become a fan of Buchanan. But his view warrants attention.

“How does a nation so divided stand united in the world? And if it cannot stand united in the world, how long does it remain a great nation?”

A Nation at War With Itself (Pat Buchanan)

President Donald Trump has decided to cease cooperating with what he sees, not incorrectly, as a Beltway conspiracy that is out to destroy him. “We’re fighting all the subpoenas,” Trump said Wednesday. “These aren’t, like, impartial people. The Democrats are out to win in 2020.” Thus the Treasury Department just breezed by a deadline from the House Ways and Means Committee to deliver Trump’s tax returns. Thus the White House will invoke executive privilege to deny the House Judiciary Committee access to ex-White House counsel Don McGahn, who spent 30 hours being interrogated by Robert Mueller’s team. Thus the Justice Department is withholding from the Oversight Committee subpoenaed documents dealing with the decision to include a question on the 2020 Census about citizenship status.

Across the capital, the barricades are going up figuratively as they did physically in the 1960s and ’70s. Once more, it’s us against them. Cognizant of the new reality, Trump seems to be saying: These House investigations constitute a massive political assault, in collusion with a hostile media, to destroy my presidency. We do not intend to cooperate in our own destruction. We are not going to play our assigned role in this scripted farce. We will resist their subpoenas all the way to November 2020. Let the people then decide the fate and future of the Trump presidency — and that of Nancy Pelosi’s House.

[..] Whatever may be said about the “deplorables,” they are not obtuse. They do not believe that people who call them racists, sexists, nativists and bigots are friends and merely colleagues of another party or persuasion. Trump’s defiance of subpoenas, however, will force the more moderate Democrats to join the militants in calling for hearings on impeachment in the House Judiciary Committee, which is where we are headed. The media are already salivating over the possible removal of a president they have come to loathe more than their great nemeses of the 20th century — Joe McCarthy and Richard Nixon. And the media will reward those who echo the call for impeachment. This week, two more Democrats running for president, including Sen. Kamala Harris, came aboard. Soon, the House will capitulate to the clamor and the stampede will be on.

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Sometimes I think the Democrats work for Trump. They hand him everything on a platter by getting lost in a fictional narrative.

Trump Attacks Democrat ‘Coup’ In 1st Post-Mueller Interview (RT)

Trump unloaded on Democrats, accusing them of an “attempted coup” in his first interview since the release of the Mueller report. Rehashing his usual rhetoric, Trump called the ‘Russiagate’ flop “bigger than Watergate.” On a victory lap since his election campaign was cleared of collusion with Moscow, Trump relied on a few tried and trusted tropes as he bashed the “13 angry Democrats” and “dirty cops” from the FBI for sparking the Russia investigation in an interview with Fox News’ Sean Hannity. The long-awaited publication of the redacted version of the Mueller report appears to have given Trump a huge boost of confidence as he sounded more assertive than ever, taking aim at his political opponents and doubling down on his innocence.


“The greatest scandal in the history of our country. Bigger than Watergate, because it means so much. This wasn’t stealing information from an office in the Watergate apartments. This was an attempted coup. It’s inconceivable. Like a third world country.” Trump lashed out at former rival Hillary Clinton for “destroying the lives” of his staffers, and blasted the FBI for going light on her during her private server investigation. But now, he said, the “tables have turned” and “it’s time to look at the other side,” calling the Russia investigation an “attempted overthrow of the United States government” and “a disgraceful thing.”

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Death penalty. For which UK cannot extradite. US is talking to Daniel Domscheit-Berg, who had a big fall-out with Assange. Letter sent to him is underneath the article.

US Is Investigating Assange Under Espionage Act – WikiLeaks (NP)

Right after the London police carried Julian Assange from the Ecuadorian embassy, the United States demanded his extradition. A March 2018 indictment charges him with conspiracy to commit computer intrusion, carrying a maximum penalty of five years in prison. But that is not the entire truth. Only one day after writing the indictment, the US Attorney’s Office admitted it was also investigating Assange for the „unauthorized receipt and dissemination of secret information“. That is what the Department of Justice wrote in a letter to former WikiLeaks spokesperson Daniel Domscheit-Berg, which we are publishing in full.

This accusation can be charged under the Espionage Act of 1917, a World War I era federal law intended to protect military secrets which has also been used to charge Chelsea Manning and Edward Snowden. Convictions under the Espionage Act can be punished by death. The death penalty is not only inhumane and archaic, it has legal consequences: The United Kingdom is not allowed to extradite Assange if he faces the death penalty. Charging Assange for publishing classified information is an attack on press freedom, „obtaining and disseminating secret information“ is the very task of journalism. If WikiLeaks is charged, every journalist and media outlet publishing secret information will be on trial. While the Obama administration debated this dangerous precedent, the Trump government shows no restraints.

[..] In Virginia, a federal grand jury is secretly investigating Assange and WikiLeaks. In December 2017, an FBI agent filed an affidavit to support charging Assange with a computer hacking conspiracy. Based on that, the grand jury issued an indictment against Assange on March 6, 2018. This document was unsealed and published immediately after his arrest in London. It is the official justification for the extradition request. But that is not the whole story. Just one day after writing the indictment, on March 7, 2018, the same US Attorney, Tracy Doherty-McCormick, wrote a letter to the lawyers of Daniel Domscheit-Berg in Germany.

Sporting the Department of Justice seal, the chief federal prosecutor requests a „voluntary questioning“ of Domscheit-Berg, explicitly „about possible violations of US federal criminal law regarding the unauthorized receipt and dissemination of classified information“ – a drastic accusation under the Espionage Act. The US Attorney goes on to explain some conditions for Domscheit-Berg. He must answer all questions fully and truthfully, the US may use all statements and information for criminal investigations and cross-examination. In return, whatever Domscheit-Berg testifies will not be used for prosecutions against him.

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Bit late perhaps?!

UN Special Rapporteur On Privacy Meets Assange In Prison: “I Will Act” (Maurizi)

He is the first person who has been able to visit Julian Assange at the Belmarsh prison besides Assange’s lawyers. In fact, although two weeks have passed since the arrest of the WikiLeaks’ founder, no other visitors are allowed apart from his lawyers. The UN Special Rapporteur on Privacy, Professor Joe Cannataci, just visited Julian Assange at the Belmarsh prison, a high security prison marked by the strictest prison regime in the UK, and in fact even visitors have to undergo to intensive controls, including police interviews, and of course meetings are monitored. Repubblica just interviewed the UN Rapporteur Cannataci.

Professor Cannataci, how did Assange seem to be doing? «My visit went well, Mr Assange was ready to answer my questions. We have already started gathering facts and asked questions of Assange’s legal team and of the Ecuadorian ambassador in London»

How is Julian Assange? We were all shocked by his appearance the day of his arrest… «I am not a physician, and so I am unable to make a medical assessment of him and of course I met him in prison, which is never a pleasant place to meet, however, it seemed to me he was in fairly good condition».

Were you able to talk to him with some privacy, or were you under surveillance? «No, my impression was that the UK authorities assured us a level of privacy intended for meetings with legal counsel. Usually in the UK prisons you have the following rules: for social meetings, like meetings with relatives, you don’t expect privacy, whereas meetings with legal counsels are usually not subjected to monitoring. These kinds of meetings are held in special places, usually 10-15 small rooms where detainees can meet their lawyers confidentially. I had asked for a confidential meeting and I am happy that the UK government agreed to provide us such a private meeting».

What are you investigating exactly, in relation to this meeting with Julian Assange? «At the end of March Mr Assange submitted an official complaint, which said that his right to privacy had been infringed during his time in the embassy of Ecuador. Together with my team, I made a preliminary assessment to see if his privacy has been infringed, therefore I am gathering the facts, these facts lead to a number of questions about behaviour which took place in the embassy. Today we are still in the preliminary stage. After my meeting with Mr Assange, I had a meeting with his legal team and then a meeting with the ambassador of Ecuador».

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I tell you: Macron simply doesn’t know he’s lost it all. He’s blind: “Did we take a wrong turn?’ I believe quite the opposite.” And that in the face of 25 weekends of protests against him.

Macron Responds To Gilets Jaunes Protests With €5 Billion Tax Cuts (G.)

Emmanuel Macron has vowed to make his style of politics more “humane”, but insisted he would press on with his project to liberalise the French economy and overhaul its welfare state despite five months of demonstrations by gilets jaunes (yellow vest) anti-government protesters. In his first press conference in two years as president, Macron promised €5bn worth of cuts to income tax for lower and average earners as well as pension rises for the poorest and vowed no more schools or hospitals would be closed during his presidency, as he responded to protests.

The centrist politician conceded that he needed to inject more “humanity” into his style of governance but insisted he would not make changes to his pro-business programme, despite the ongoing anti-government Saturday protests by gilets jaunes, which resulted in sporadic rioting and arson in Paris and other cities. Macron said he recognised the protesters’ “just demands” and “anger and impatience for change” and their feeling of not being taken into account by the “elites”, including the presidency, but public order must now be restored. He said although he respected the demonstrators who gathered at the start of the movement in November, he said it had “transformed progressively” and been marred by episodes of antisemitic violence, homophobia and rioting.

He said he stood by his project to liberalise the French economy, defending his controversial cuts to its wealth tax, which protestors sought to overturn. He said France was unique in Europe in not having dealt with its structural problem of mass unemployment so he would not go back on his planned “transformation” of the country. He said: “I asked myself: ‘Should we stop everything that was done over the past two years? Did we take a wrong turn?’ I believe quite the opposite.” [..] He promised to scrap the École nationale d’administration elite graduate training school for French civil servants and public officials. Saying the French style of governance needed to shift, Macron said he planned to make it easier for citizens to propose national referendums, and also would introduce 20% proportional representation into the lower house of parliament.

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Schengen, Dublin, they don’t serve Macron’s career, so out with them.

Macron: Smaller Schengen Zone Because EU Migration Policies ‘Do Not Work’ (RT)

The Schengen agreement and the current migrant-sharing mechanism are deeply flawed and need urgent fixing, French President Emmanuel Macron has said. Europe must “have borders” even if it means a smaller Schengen zone, he said. In the first major press conference since the Yellow Vest movement took off in November, Macron unveiled a range of policy measures to placate the protesters, including a proposed overhaul of the European-wide migration policy and the Schengen agreement. The embattled French leader argued that the agreement that guarantees free movement across the Schengen area, while “wonderful,” does not work anymore. The same, he said, applies to the Dublin Regulation that determines which EU member-state is responsible for accepting asylum seekers.


Under the current version of the agreement, which came into force in 2013 and applies to all EU member-states except Denmark, the main criteria for determining responsibility is the first point of entry. “The common borders, Schengen, Dublin agreements do not work anymore,” Macron said, adding that it is essential for Europe to make “profound” changes in its way of handling migrant arrivals. Macron called for reinforced border security, which might entail having a Schengen “with fewer states.” The Schengen area comprises 26 states, including 22 EU member-states and four non-EU countries: Norway, Iceland, Switzerland and Liechtenstein. It is named after the 1985 agreement that abolished internal borders allowing people within the zone to travel freely from one country to another.

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Trojan horse.

Irish Backstop Could Undermine EU Standards – Report (G.)

It is a dastardly trap, designed to lock freedom-loving Britain into the European Union’s protectionist customs union: that is the argument against the so-called backstop, cited by hardline Brexit advocates as the main reason why they have thrice voted down Theresa May’s deal with the European Union. But as the dust settles after months of chaos in Westminster, suspicions are growing on the other side of the Channel that the backstop could in fact be the very opposite: a brilliant deception device constructed by crack UK negotiators, which would allow a more reckless British prime minister to undermine the EU’s green and social standards while still keeping access to the European single market.

A new report, commissioned by the German Green party and seen by the Guardian, will exacerbate concerns in Berlin over the small print of the withdrawal agreement in its current form. The deal, agreed between the EU and the UK in November 2018 but voted down three times in the House of Commons, states that the whole of the UK would remain in a de facto customs union with the EU until a trade and security agreement has been reached that prevents the setting up of a hard border between the Republic of Ireland and Northern Ireland. nTo prevent Britain from diverting from EU standards on environmental or social protection after the backstop has come into effect, the customs territory would “include the corresponding level playing field commitments and appropriate enforcement mechanisms to ensure fair competition between the EU27 and the UK”.

The new German report, however, warns that the wording of the deal means the EU side will find it impossible to stop a more aggressive Britain led by a Boris Johnson or a Jacob Rees-Mogg from flouting such standards while still being able to export British products into the single market. “If the EU wants to have a level playing field, it must not just set up the goals but also assign a referee,” said the author of the report, EU law expert Dr René Repasi. “At the moment it has even given the UK licence to assign its own players with officiating the match.”

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On 5G, individual countries make the decisions.

Juncker Refuses To Reject Huawei ‘Just Because It’s Chinese’ (RT)

European Commission President Jean-Claude Juncker says he won’t bar Chinese firms like Huawei from doing business with Europe, as long as they respect market rules, despite continued US pressure to ban the company. “We are not rejecting someone because he is coming from faraway, because he is Chinese, the rules have to be respected,” Juncker said at a press conference with Japanese PM Shinzo Abe on Thursday. Asked about his response to the US call to “eliminate” Chinese telecoms equipment from Europe’s 5G buildout, Juncker was defiant. “The European Union and our internal market are open markets and all those respecting our rules governing this internal market are welcome,” he said.


Last month, Europe’s Parliament passed a resolution “expressing their deep concern” about alleged Chinese cybersecurity threats, but a subsequent statement from the European Commission regarding 5G cybersecurity did not include such language, instead merely urging member states to develop a “toolbox of mitigating measures” to combat cybersecurity risks to their growing 5G infrastructure. The US has leaned heavily on allies to keep Huawei and other Chinese telecoms out of their countries, claiming the company could act as a spy for the Chinese government. Washington has even threatened to withhold intelligence from Germany over their refusal to ban the Chinese firm, pressure China’s foreign minister has called “abnormal” and “immoral.”

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May invites Huawei. Will she stand up to Trump in other areas too?

Huawei Leak Highlights Collapse Of Discipline In May’s Cabinet (G.)

Leaks from deep within Theresa May’s bitterly divided administration have become widespread and common: as one despairing official remarked recently, “this government is a sieve”. But the revelation of the highly sensitive news that ministers have decided to set aside cybersecurity concerns and involve the Chinese firm Huawei in the creation of Britain’s 5G network is regarded by many as a leak too far. The decision was taken at the national security council, on which ministers sit alongside officials and members of the security services. The secrecy of its discussions has never before been breached. A full-scale inquiry is now expected to be launched, but a slew of other briefings and counter-briefings from private meetings in recent weeks and months has not just gone unpunished but become almost unremarkable.


There are several, allied reasons for this pervasive culture of briefing and counter-briefing, which means multiple competing accounts of cabinet meetings are available shortly after ministers walk out of Downing Street. One is simply the ready availability of instant electronic communication – a string of WhatsApp messages is a lot quicker and more straightforward than the old-fashioned gossip over lunch or in a Westminster bar (though that still happens too, of course). Another is the historic significance of the issues at stake and the lack of trust on both sides of the Brexit debate, which means all the key players want to ensure their point is heard even if they lost the argument in the room.

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The Fed will make up the difference. Can’t have stocks going down.

European Equities May Benefit As $1 Trillion In US Buybacks Vanish (ZH)

European equities may start to finally see some love, as they are now positioned to take advantage of one significant coming tailwind from the U.S., according to Bloomberg. Over the next 12 months, US stocks are going to lose a significant amount of support that they have received from buybacks, as the nearly $1 trillion buyback bonanza that has fueled stock purchases in the United States starts to come to an end, according to Sanford C. Bernstein strategists. This could be an area where European stocks, due to their low dependence on buybacks, could see help as a result. Bernstein strategists led by Inigo Fraser-Jenkins said: “This would remove one advantage of U.S. equities over Europe. As the buyback support is reduced it will make a stronger relative case for Europe.”


And the decision of the U.S. central bank to hold off on rate increases may have temporarily reduced concerns about debt hurting equities, but the topic is still on the table and credit spreads are expected to keep widening over the next year. Furthermore, the significance of share repurchases to the US rally has been pronounced, with $1 trillion in buybacks in just 2018 alone, far overshadowing the $100 billion in net inflows from active and passive funds. And even though European equities have rallied to the tune of more than $1.5 trillion since December’s lows, shorting these stocks remains a popular trade globally, according to Bank of America Corp.’s latest fund manager survey. And many traders are still on the sidelines, as Europe’s ugly politics and mixed economic data continues to weigh on sentiment.

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To find this out, we must travel back in time.

Universe Expands Faster Than Expected – NASA

The universe is expanding considerably faster than it should be, Nasa has confirmed. The space agency’s Hubble Space Telescope shows that it is growing about 9 per cent faster than had been expected, based on the trajectory it started with shortly after the Big Bang, according to astronomers. While such a discrepancy had already been suggested, the new measurements reduce the chance this is a mistake to just one in 100,000. Such a confirmation could require astronomers to find new physics theories to explain the universe‘s strange behaviour. “This mismatch has been growing and has now reached a point that is really impossible to dismiss as a fluke.

This is not what we expected,” says Adam Riess, Bloomberg Distinguished Professor of physics and astronomy at Johns Hopkins University, Nobel laureate and the project’s leader. The speed of the universe’s expansion, known as the Hubble constant, is a central part of physics and our understanding of the universe. But it has repeatedly been observed to behave unexpectedly – the more astronomers find out about it, the more wrong it appears – in ways that have forced scientists to wonder whether our assumptions about it had been wrong. The new study confirms that speculation, and requires further work to explain how exactly the universe is growing.

The research saw Professor Riess and his team analyse light from 70 stars in a galaxy near ours, known as the Large Magellanic Cloud, using a new method that allowed them to capture the stars quickly. The stars they observed are called Cepheid variables, and change brightness predictably, allowing them to be used to measure intergalactic distances. The new method allowed the researchers to measure many more of those stars far more quickly. Normally, Hubble can only look at one star each time it takes one of its 90-minute orbits around Earth, but the new method allowed it to see dozens in that same time.

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Apr 092019
 


Paul Cézanne Bibémus quarry 1898-1900

 

Trump is Right to Blow Up the Fed (Christopher Whalen)
What Would Stocks Do in “a World Without Buybacks,” Goldman Asks (WS)
Nunes Sends AG Barr Eight Criminal Referrals For Leaks (G.)
Theresa May Forced To Delay Brexit After Historic Win For MPs (G.)
Theresa May To Ask Merkel And Macron For Brexit Delay (R.)
May Risks Wrath Of Tory Brexiters To Plead With EU For More Time (G.)
IMF Economist Warns On Australia Property Slide (AFR)
Stretched Australians Unable To Reduce Debt (AFR)
US Proposes New Tariffs On EU Products Over Airbus Subsidies (AFP)
The Curse of the Thinking Class (Kunstler)
Ecuador Removes Official Close To Assange From London Embassy (SBS)
Brexiteers to Communists And Everything Between Unite For Julian Assange (CF)
Pesticides And Antibiotics Polluting Streams Across Europe (G.)
Nepal Expedition To Remeasure Height Of Mount Everest (AFP)

 

 

But blow it up for real then. What are the odds of that given that the Fed protects the riches of the rich?

Trump is Right to Blow Up the Fed (Christopher Whalen)

Last week, President Donald Trump set the economics community aflame by suggesting that he will appoint businessman and presidential aspirant Herman Cain to the Federal Reserve Board. Even more than political economist Stephen Moore, the critics maintain, Cain represents a threat to the cabal that has controlled the central bank for decades. Why? Because Cain is a successful executive who founded a real business, took risks, and created jobs, things most academic economists will never ever do. Media outlets and other allied constituencies have howled with rage at the prospect of President Trump “packing the Fed,” a distant reference to attempts by President Franklin D. Roosevelt to pack the Supreme Court in the 1930s.

Those worried about the independence of the Federal Reserve Board should reconsider. Independence from what exactly? While the Fed is meant to be independent from the executive branch on a day-to-day basis, it is certainly not independent of Congress or the law. Yet the Fed in recent years has shown a troubling tendency to deviate from its legal mandate and make up new authorities to fit the changing economic situation. Case in point: the dubious notion that we should seek a 2 percent rate of inflation. Anybody who cares to read the 1978 Humphrey Hawkins law will know that the Fed is directed by Congress to seek full employment and then zero inflation. Not 2 percent, but zero.

Yet going back a decade and more, the Fed, led by luminaries such as Janet Yellen and Ben Bernanke, has advanced a policy of actively embracing inflation. And neither Bernanke nor Yellen bothered to consult Congress when they decided to discard their legal responsibilities. Quantitative easing, to take another example, represents a vast inflation of the financial markets and housing, yet Fed officials actually appear in public and talk about the conundrum presented by “low inflation.” The inflation in home prices that occurred during and after the Fed’s purchase of trillions in securities has permanently raised the price of housing in many parts of the country, preventing millions from purchasing homes. Yellen confesses to be “perplexed” by the dearth of home purchases by young families, but she is the cause of the malady.

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You are not allowed to know the value of the things you buy.

What Would Stocks Do in “a World Without Buybacks,” Goldman Asks (WS)

In the fourth quarter 2018, share repurchases soared 62.8% from a year earlier to a record $223 billion, beating the prior quarterly record set in the third quarter last year, of $204 billion, according to S&P Dow Jones Indices on March 25. It was the fourth quarterly record in a row, the longest such streak in the 20 years of the data. For the whole year 2018, share buybacks soared 55% year-over-year to a record $806 billion, beating the prior record of $589 billion set in 2007 by a blistering 37%! The record buybacks in Q4 came even as stock prices declined on average 5.3%, according to S&P Down Jones Indices. On some bad days during the quarter, corporations were about the only ones left buying their shares.

For the year 2018, these were the top super-duper buyback queens:
Apple: $74.2 billion
Oracle: $29.3 billion
Wells Fargo $21.0 billion
Microsoft: $16.3 billion
Merck: $9.1 billion


But who, outside of corporations buying back their own shares, was buying shares? Goldman Sachs strategists answered this question in a report cited by Bloomberg, that used data from the Federal Reserve to determine “net US equity demand.” These are the largest investor categories other than corporate buybacks, five-year totals:
Foreign investors shed $234 billion.
Pension funds shed $901 billion, possibly to keep asset-class allocations on target as share prices soared.
Stock mutual funds shed $217 billion.
Life insurers added 61 billion
Households added $223 billion.

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Also part of Russiagate.

Nunes Sends AG Barr Eight Criminal Referrals For Leaks (G.)

The “absolutely horrific” leak of Donald Trump’s contentious 2017 phone call with Malcolm Turnbull could lead to criminal charges. Devin Nunes, the highest-ranking Republican member on the US House of Representatives intelligence committee, announced on Sunday he was sending eight criminal referrals to the US attorney general, William Barr. One is aimed at finding out who leaked transcripts of the US president’s phone call with Turnbull on 28 January 2017, a call with the then Mexican president, Enrique Peña Nieto, and former national security adviser Michael Flynn’s communications with a Russian ambassador.

“You had conversations with the president of the United States and the prime minister of Australia leak,” Nunes told Fox News. “You had leaks of President Trump talking to the president of Mexico leak. “We all know the travesty of General Flynn. “Nobody knows where those supposed transcripts came from. “Those are just three examples that are absolutely horrific but there’s things that are even worse that were leaked, and there were only two or three reporters involved in this, so it would not be hard to get to the bottom of.” The Trump-Turnbull phone call transcript leak to the Washington Post rocked the usually solid US-Australian alliance, with both nations going into damage control when it was revealed the president abruptly cut short the planned hour-long call to just 24 minutes.

The transcript showed Turnbull pushing Trump to support the asylum seeker deal struck with the former US president Barack Obama. It was Trump’s last of numerous calls with world leaders that day, including the Russian president, Vladimir Putin. “Putin was a pleasant call,” Trump told Turnbull. “This is ridiculous.” Nunes said the eight referrals “are classified or sensitive” so he was unable to offer details. “Five of them are what I would call straight up referrals, so just referrals that name someone and name the specific crimes,” Nunes said. “Those crimes are lying to Congress, misleading Congress, leaking classified information.”

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How far removed are we from the Article 50 activation being withdrawn by the UK?

Theresa May Forced To Delay Brexit After Historic Win For MPs (G.)

Backbench MPs have passed historic legislation to delay article 50, forcing the government to set out its timetable for the length of the Brexit delay in order to prevent the UK exiting the EU with no deal. In extraordinary circumstances, the bill devised by Labour’s Yvette Cooper and the Conservative Oliver Letwin passed its final stages in the House of Lords on Monday night and was approved by the Commons that evening. The swift passage of the bill, which took just three sitting days to complete, was made possible by the success of an unprecedented amendment which allowed MPs to seize control of parliamentary business on particular days, meaning the government could not block its progress.


The EU Withdrawal (No 5) Act received royal assent just after 11pm on Monday night, forcing the prime minister to extend the article 50 process and to set out the length of the extension in the Commons on Tuesday. The Commons leader, Andrea Leadsom, said the government would no longer block the progress of the bill after it was passed by the Lords on Monday evening, but she called it a “huge dog’s dinner” and criticised how little time for debate the bill had been given.

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Take back control! Ask for permission!

Theresa May To Ask Merkel And Macron For Brexit Delay (R.)

British Prime Minister Theresa May will meet German Chancellor Angela Merkel and French President Emmanuel Macron on Tuesday to argue for a Brexit delay while her ministers hold crisis talks with Labour to try to break the deadlock in London. Britain’s departure from the EU has already been delayed once but May is asking for yet more time as she courts veteran socialist Jeremy Corbyn, whose opposition Labour Party wants to keep Britain more closely tied to the bloc after Brexit. “The Prime Minister has not yet moved off her red lines so we can reach a compromise,” Corbyn said ahead of further talks between his team and government ministers on Tuesday. While May travels to Berlin and Paris ahead of an emergency EU summit in Brussels on Wednesday, British lawmakers will hold a 90-minute debate on her proposal to delay Britain’s EU departure date to June 30 from April 12.

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There is no way out anymore.

May Risks Wrath Of Tory Brexiters To Plead With EU For More Time (G.)

Theresa May will go to Paris and Berlin to plead with Angela Merkel and Emmanuel Macron for a Brexit extension on Tuesday, promising to be a good member of the European Union until departure day and claiming talks with Labour have a serious chance of reaching a deal. Before an emergency European summit this week, the prime minister will head to the continent to make the case for extending article 50 only until the end of June. However, she is also being forced to make pledges that the UK would abide by EU rules for however long it is a member, given that a longer delay and participation in European elections now look like the most likely option.

EU leaders will decide at the talks on Wednesday night whether to grant an extension to article 50 at all but are most likely to offer a longer delay of up to a year involving strict conditions forcing the UK into “sincere cooperation” with the rest of the bloc. That prospect appeared to be acknowledged on Monday when the Conservative party drew the ire of hard Brexiters – already seeking an indicative confidence vote in the prime minister – by telling potential local election candidates it is preparing to fight in the European elections in May, and asking potential MEPs to put themselves forward.

To avoid EU elections, May would probably have to pass her deal by 12 April and have all the necessary legislation pushed through parliament by the day of the polls on 23 May. If no extension is granted and no withdrawal agreement passed, the UK will leave the EU without a deal on Friday.

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I don’t understand things like this: “..whichever party wins the next election will have its work cut out for it sustaining Australia’s near three-decade run of continuous economic growth.

You’re going to have to accept that growth may halt over 30 years, and to realize that may be a good thing.

IMF Economist Warns On Australia Property Slide (AFR)

Australia’s housing market contraction is worse than first thought, says a top IMF analyst, leaving the economy in what he called a “delicate situation” that boosts the need for faster infrastructure spending and even potential interest rate cuts. In an exclusive interview, the International Monetary Fund’s lead economist for Australia, Thomas Helbling, endorsed last week’s federal budget forecasts for recognising the “weaker outlook” and its use of sober commodity price forecasts. However, Dr Helbling warned the negative fallout from what the IMF will this week admit is a greater-than-anticipated property market downturn in Australia requires more effort by governments to deliver new sources of growth to make up for a worsening shortfall.


Dr Helbling implied the pace of infrastructure spending – as measured in the national accounts – has fallen short of what was scheduled in recent budget figures. “I think given where the economy is now, that this growth impetus comes forward is important in the current cyclical setting. “The ambition [on infrastructure spending] is in many senses welcome,” he said. “The housing market downturn is sort of sagging on the demand side, so you want to have other demand sources pulling.” The assessment by Dr Helbling suggests whichever party wins the next election will have its work cut out for it sustaining Australia’s near three-decade run of continuous economic growth.

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3 decades of growth, right?

Stretched Australians Unable To Reduce Debt (AFR)

Less than a third of Australians expect to reduce their debt load this year – down from 60 per cent last year – and not because they don’t want to but because they can’t, a survey by EY shows. Australia’s household debt-to-income ratio is 190 per cent, and the Reserve Bank of Australia says it remains one of the biggest vulnerabilities in the economy. The heightened level of debt is unlikely to change even with interest rates expected to fall over the coming year, and the introduction of income tax cuts helping some to reduce debt rather than increase spending.

When survey respondents were asked whether they expected to reduce, increase or keep personal and household debt at the same level, 28 per cent said they would reduce their debt level, down from 60 per cent in last year’s survey. In 2018, 73 per cent of high-income earners ($150,000 or more) said they expected to pay down debt. That has fallen to 37 per cent. “Given that our survey also showed that over 60 per cent of Australians are ‘extremely’ concerned about the increasing cost of living – the cost of essential services and increasing energy prices – it seems that more households are not paying down debt because they do not have the capacity to do so,” EY chief economist Jo Masters said.


[..] The number who said they would increase their debt level over the next 12 months has risen to 16 per cent, up from 4 per cent last year. In the income bracket of $70,000-$149,999 the number of people looking to increase debt has risen to 21 per cent up from just 6 per cent last year. The number in that income bracket who were looking to decrease their debt dropped to 34 per cent from 62 per cent last year.

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Dear Americans, you’re going to pay more for your European wine and cheeses so attention is deflected from Boeing.

US Proposes New Tariffs On EU Products Over Airbus Subsidies (AFP)

The US on Monday threatened to impose tariff counter measures of up to $11.2 billion on a host of European products in response to subsidies received by aircraft maker Airbus. In a statement, the office of the US Trade Representative (USTR) said the World Trade Organization (WTO) had repeatedly found that EU subsidies to Airbus have caused adverse effects to the United States. “This case has been in litigation for 14 years, and the time has come for action,” said US Trade Representative Robert Lighthizer.


“Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted.” The statement added that the final amount it would seek in duties was subject to arbitration at the WTO, the result of which was expected this summer. The USTR’s preliminary list extends to 14 pages and contains a number of products in the civil aviation sector, including Airbus aircraft.

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“.. a hopeless attempt to preserve their reputations and perhaps even their livelihoods.”

The Curse of the Thinking Class (Kunstler)

What is a bigger emergency: the destruction of all those towns, cities, and lives in flyover-land, or the S & P stock index going down twenty points? The choice made by the “experts” the past ten years is obvious: pump the financial markets at all costs by using dishonest policy interventions which they are smart enough to know will eventually blow up the banking system. They did it to preserve their reputations long enough to retire out of their jobs. The trouble is that the damage is now so extreme that when the time comes for them to apologize it will not be enough. They will lose their freedom and perhaps their heads. The neuroticism and dishonesty is exactly what turned two of this country’s most sacred and noble endeavors, higher education and medicine, into disgraceful rackets.

Sunday night, CBS 60 Minutes covered both bases in their lead story about how the NYU medical school recently declared its program tuition-free. This great triumph was due to an enormous cash gift from one of the founders of the Home Depot company, billionaire Ken Langone. Nowhere in the broadcast did CBS raise the question as to how the cost of a degree became so outrageous in the first place. Or how Mr. Langone made his fortune by putting every local hardware store in America out of business, which enabled him to capture the annual incomes of ten thousand small business owners and their employees. NYU’s grand gesture is just a way to paper over the shame of the University executives’ role in the college loan racket that may destroy countless lives.

[..] RussiaGate, of course, has been the most acute locus of neurotic dishonesty across this land the past two years. The primary information organs of the thinking class — The New York Times, The WashPo, CNN, MSNBC — have not only omitted to apologize for the dangerous hysteria they knowingly propagated, but they persist in supporting the matrix of fantasies at all costs in what must now be seen as a hopeless attempt to preserve their reputations and perhaps even their livelihoods. The repudiation of this nonsense by chief inquisitor Robert Mueller could not be more absolute, even if he was compelled by reality against his own wishes and instincts to do it. And now, what avenue will all this diseased animus of the thinking class go down in its destructive, shame-fueled frenzy to justify itself?

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I thought they’d already gotten rid of everyone even a little sympathetic to him.

Ecuador Removes Official Close To Assange From London Embassy (SBS)

The Ecuadorian government has removed an official from its London embassy accused of having a close rapport with WikiLeaks founder Julian Assange. Foreign Minister Jose Valencia has told Democracia radio in Quito the civil servant “worked in a very close way” with Assange. Valencia did not provide the official’s name or go into any detail, other than to say that embassy workers must respond first to the Ecuadorian state. The removal comes as tensions between Ecuador and Assange continue to mount. Ecuador recently accused WikiLeaks of helping spread leaked personal documents belonging to President Lenin Moreno.

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Cassandra’s been reporting from the street in front of the embassy. Undercover cops galore.

Brexiteers to Communists And Everything Between Unite For Julian Assange (CF)

The mainstream media tells us we live in an age of “hyper-partisanship.” But that’s not what I witnessed outside the Ecuadorian Embassy in London, where populist right-wingers, anti-imperialist socialists, Brexit supporters and even liberals stood united against the political establishment’s seven-year persecution of WikiLeaks and Julian Assange. Protesters from nearly every part of the political spectrum could be found outside the embassy during my three-day expedition, galvanized by reports that Assange may soon be expelled from the building where he has been living under political asylum since 2012.

On Saturday afternoon, England’s Yellow Vests and Brexit supporters flooded the area in support of the WikiLeaks publisher. A few steps away from them, also flying the flag for WikiLeaks, was an out-and-proud communist wearing a Black Lives Matter shirt, wheeling around a slogan-adorned cart praising Cuban revolutionaries. It was the first sign that both the far-left and the populist right, despite the gulf of their differences, could stand together in support of a free press. Both leftists and the pro-Brexit right wing crowd chanted “which side are you on” together to the police. They also found common cause in their distrust of the mainstream media, chanting “Fake News BBC” for several minutes – a reference to the notoriously biased British Broadcasting Corporation, the U.K,’s state-backed broadcaster.


Over the next few days, more than one leftist activist told me of their special disdain for BBC reporter John Sweeney, and one even expressed quiet praise for the populist Islam critic Tommy Robinson’s work exposing the BBC in general and Sweeney in particular. The following day, it was the turn of Latin American leftists to have a show of force. Scattered right-wing activists danced along with an upbeat protest organized by socialist Ecuadorian expats in support of Assange. The group held signs branding Ecuadorian President Lenin Moreno a traitor along with banners demanding that the WikiLeaks founder be protected — while standing around Che Guevara flags.


Ciaron O’Reilly has been camped outside the embassy for over 130 days

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“The pollution was so severe in places that the ditchwater itself could have been used as a pesticide.”

Don’t allow Monsanto and Syngenta to play the good guys, as they do here.

Pesticides And Antibiotics Polluting Streams Across Europe (G.)

Pesticides and antibiotics are polluting streams across Europe, a study has found. Scientists say the contamination is dangerous for wildlife and may increase the development of drug-resistant microbes. More than 100 pesticides and 21 drugs were detected in the 29 waterways analysed in 10 European nations, including the UK. A quarter of the chemicals identified are banned, while half of the streams analysed had at least one pesticide above permitted levels.

[..] One of the world’s biggest pesticide makers, Syngenta, announced a “major shift in global strategy” on Monday, to take on board society’s concerns and reduce residues in the environment. “There is an undeniable demand for a shift in our industry,” said Alexandra Brand, the chief sustainability officer of Syngenta. “We will put our innovation more strongly in the service of helping farms become resilient to changing climates and better able to adapt to consumer requirements, including reducing carbon emissions and reversing soil erosion and biodiversity decline.” Another major pesticide manufacturer, Bayer, said on Monday it was making public all 107 studies submitted to European regulators on the safety of its controversial herbicide glyphosate.

[..] The testing techniques used in the new research meant only a subset of pesticides could be detected. Two very common pesticides – glyphosate and chlorothalonil – were not included in the study.. [..] Irish Water said on Monday that EU pesticide levels were being breached in public water supplies across Ireland. In Switzerland, another new study found that soils in 93% of organic farms were contaminated with insecticides, as were 80% of the areas farmers set aside for wildlife. Research revealed in 2013 that insecticides were devastating dragonflies, snails and other water-based species in the Netherlands. The pollution was so severe in places that the ditchwater itself could have been used as a pesticide.

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1000s of highly sophisticated satellites in orbit but they still need climbers to measure a mountain.

Nepal Expedition To Remeasure Height Of Mount Everest (AFP)

Nepal is sending a team of government-appointed climbers up Mount Everest to remeasure its height, officials said Monday, hoping to quash persistent speculation that the world’s tallest mountain has shrunk. Four government surveyors will depart Wednesday for Everest, which lies on the Himalayan range straddling the border of Nepal and China. Its official height is 8,848 metres (29,029 feet), first recorded by an Indian survey in 1954. Numerous other teams have measured the peak, although the 1954 height remains the widely accepted figure. But a heated debate erupted in the aftermath of a massive earthquake in Nepal in 2015, with suggestions the powerful tremor had knocked height off the lofty peak.

Nepal’s Survey Department commissioned a team of surveyors in 2017 to prepare for an Everest expedition in the hope of putting the matter to rest. “We are sending a team because there were questions regarding the height of Everest after the earthquake,” the expedition’s co-ordinator from the Survey Department, Susheel Dangol, told AFP. Four government surveyors have spent two years fine tuning their methodology for measuring the peak, collecting readings from the ground and training for the extreme conditions they will encounter at the top of the world. They will ascend the treacherous mountain armed with advanced equipment to collect the remaining data to derive the true height of the peak, officials say.

[..] In May 1999 an American team added two metres to Everest’s height when it used GPS technology to survey the peak. That figure is now used by the US National Geographic Society, but otherwise not widely accepted. Later, Nepal became embroiled in a diplomatic row with China after the latter claimed the peak was four metres shorter than the accepted height.

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Nov 212018
 
 November 21, 2018  Posted by at 10:07 am Finance Tagged with: , , , , , , , , , , , , ,  7 Responses »


Jack Delano Lower Manhattan 1941

 

Senate Calls On Trump For Saudi Answers (BBC)
Saudi Arabia Tortured Female Right-to-Drive Activists – Amnesty (AP)
Trump Submits Answers To Robert Mueller Questions In Russia Probe (Ind.)
Trump Wanted To Order Justice Dept To Prosecute Clinton, Comey – NYT (R.)
Dow Plunges More Than 500 Points, Erases Gain For 2018 (CNBC)
Stunned Investors Observe The Market Carnage In Shock (ZH)
A Death Cross Is Forming In US Oil (MW)
Bitcoin Plunges As Much As 16% To Below $4,100, A New Low For The Year (CNBC)
Misguided Share Buybacks Are Hollowing Out Companies’ Balance Sheets (MW)
Bank of England Backs Theresa May’s Brexit Deal, Warns Of No-Deal Dangers (G.)
May’s Brussels Trip Only Start Of ‘Endless’ EU Trade Talks (G.)
UK To Be ‘Frozen Out’ Of 182 EU Decisions During Brexit Transition (Ind.)
Interpol Elects South Korean As Its President In Blow To Russia (G.)
Tax ‘Virgin Packaging’ To Tackle Plastics Crisis – Report (G.)
Dead Whale Washes Ashore In Indonesia With 6 Kilos Of Plastic In Stomach (AP)
Julian Assange Deserves A Medal of Freedom, Not A Secret Indictment (USA Today)

 

 

The indignation over Trump’s comments on Saudi Arabia is shifting into overdrive. Perhaps that’s needed to expose the hypocrisy inherent in them. It’s not Trump, it’s America that has condoned torture and murder by the House of Saud for decades. That started actively assisting the Saudi’s in Yemen under Obama. Trump refuses to be set up by the media and Democrats as the fall guy for $150 oil prices. He’s thinking: let Congress do it, now that it’s blue. If that’s immoral, he’s not alone.

Senate Calls On Trump For Saudi Answers (BBC)

US President Donald Trump has been asked to ascertain whether Saudi Crown Prince Mohammed bin Salman played a role in the murder of Jamal Khashoggi. Republican and Democratic leaders of the US Senate Foreign Relations Committee on Tuesday sent a letter demanding a second investigation. Mr Trump earlier defended US ties with Saudi Arabia despite international condemnation over the incident. Khashoggi was killed on 2 October inside the Saudi consulate in Istanbul. In a statement on Tuesday, Mr Trump acknowledged that the crown prince “could very well” have known about Khashoggi’s brutal murder, adding: “Maybe he did and maybe he didn’t!”

He later stated that the CIA had not made a “100%” determination on the killing. Following the president’s comments, Republican Senator Bob Corker and Democrat Bob Menendez issued a statement on behalf of the Senate Foreign Relations Committee. In it they called on Mr Trump to focus a second investigation specifically on the crown prince so as to “determine whether a foreign person is responsible for an extrajudicial killing, torture or other gross violation” of human rights. The request, issued under the Global Magnitsky Human Rights Accountability Act, requires a response within 120 days.

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OK, CNN, do your job.

Saudi Arabia Tortured Female Right-to-Drive Activists – Amnesty (AP)

Several activists imprisoned in Saudi Arabia since May, including women who campaigned for the right to drive, have been beaten and tortured during interrogation, Amnesty International has said. Saudi Arabia has detained at least 10 women and seven men on vague national security allegations related to their human rights work, the organisation said on Tuesday. Those detained include Loujain al-Hathloul, Eman al-Nafjan and Aziza al-Yousef, who had campaigned for the right to drive before the decades-long ban was lifted in June. Amnesty said that according to three testimonies it obtained, some of the activists were repeatedly given electric shocks and flogged, leaving some unable to walk or stand properly. In one instance, an activist was hung from the ceiling.

Another testimony said one of the detained women was subjected to sexual harassment by interrogators wearing face masks. The kingdom is at the centre of an international firestorm after the killing of Saudi journalist Jamal Khashoggi, who had written critically about Crown Prince Mohammed bin Salman’s crackdown on dissent, including the arrests of the women activists. Khashoggi was killed and then dismembered by Saudi agents in the kingdom’s consulate in Istanbul on 2 October. Lynn Maalouf, Amnesty’s Middle East research director, said: “Only a few weeks after the ruthless killing of Jamal Khashoggi, these shocking reports of torture, sexual harassment and other forms of ill-treatment, if verified, expose further outrageous human rights violations by the Saudi authorities.”

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What a waste of resources.

Trump Submits Answers To Robert Mueller Questions In Russia Probe (Ind.)

Donald Trump has submitted written answers to questions from Special Counsel Robert Mueller as part of the probe into Russian meddling in the 2016 election and possible collusion with the Trump campaign. “We answered every question they asked that was legitimately pre-election and focused on Russia,” Trump lawyer Rudy Giuliani said in an interview. “Nothing post-election. And we’ve told them we’re not going to do that.” Mr Giuliani said Trump did not plan to answer any questions from Mr Mueller on whether he tried to obstruct the investigation once he won office, such as by firing former FBI Director James Comey last year. “It is time to bring this inquiry to a conclusion,” the lawyer said in an earlier statement on the probe, which Mr Trump has repeatedly called a “witch hunt.”

Mr Trump signed the submission on Tuesday before he left Washington to spend the Thanksgiving holiday in Florida, a person familiar with the matter said. Mr Mueller was tasked to probe “any matters that arose or may arise directly from the investigation” into possible collusion between Mr Trump’s campaign and Russia during the 2016 election. [..] Mr Giuliani said in his statement the president had provided “unprecedented cooperation” with the probe over the past year and a half, noting that more than 30 White House-related witnesses had been questioned and 1.4 million pages of material turned over before Mr Trump responded to the pre-election questions in writing. He added that “much of what has been asked raised serious constitutional issues and was beyond the scope of a legitimate inquiry.”

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Not exactly news, is it? Of course there will be an investigation of Hillary, Comey and a whole circus around them. It would be a serious perverson of justice if there isn’t.

Trump Wanted To Order Justice Dept To Prosecute Clinton, Comey – NYT (R.)

U.S. President Donald Trump wanted to order the Justice Department to prosecute two political foes, his one-time presidential opponent Hillary Clinton and former FBI director James Comey, in the spring, but his White House counsel rebuffed him, the New York Times reported on Tuesday. Don McGahn, the White House counsel at the time, wrote a memo to the president outlining consequences for Trump if he did order these prosecutions. The outcomes ranged from the traditionally independent Justice Department refusing to comply, to congressional probes and voter outcry, the Times reported.

The New York Times also reported Trump’s lawyers privately asked the Justice Department to investigate Comey for mishandling sensitive government information and his role investigating Clinton’s use of a private email account and server, but law enforcement officials declined. It was not clear if Trump read the memo or pursued the prosecutions further, the New York Times said. It was also not clear what specific charges Trump wanted the Justice Department to pursue against Comey and Clinton, the Times reported. Trump has publicly railed against Clinton’s private email use during her tenure as U.S. Secretary of State, as well as her role in the Obama administration’s decision to allow a Russian company to buy a uranium mining firm.

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Time to start writing about finance again?!

Dow Plunges More Than 500 Points, Erases Gain For 2018 (CNBC)

The Dow Jones Industrial Average and S&P 500 fell sharply on Tuesday and turned negative for the year as a decline in Target shares pressured retailers, while some of the most popular tech shares dropped again. The 30-stock Dow dropped 551.80 points to 24,465.64 and the S&P 500 plunged 1.8 percent to close at 2,641.89. The Dow and S&P 500 were up 1.2 percent and 0.6 percent, respectively, for 2018 entering Tuesday. Meanwhile, the Nasdaq Composite also dropped 1.7 percent to 6,908.82 but managed to hang on to a slight gain for 2018. Tuesday’s declines come after the Dow dropped 395 points on Monday.

Stocks hit their lows of the day after Doubleline Capital founder Jeffrey Gundlach said stocks are still too expensive, adding there has not been a “panic low” yet. The Dow was down nearly 650 points at its session low, while the S&P 500 and Nasdaq had both dropped more than 2 percent. Target fell 10.5 percent after reporting weaker-than-expected earnings for the previous quarter. The company also posted lighter-than-forecast same-store sales, which is a key metric for retailers.

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Nah, they’re not investors.

Stunned Investors Observe The Market Carnage In Shock (ZH)

After another abysmal day, in which every single sector in the market closed in the red as stocks tumbled 2%, capping a dreadful two-month stretch since the S&P hit its all time highs exactly two months ago, which has seen both the S&P and the Dow turn red for the year with the Nasdaq just barely holding onto green, while oil crashed 6% slumping to a one year low, junk bonds matched a record streak of losses, the overall market just suffered one of its worst sessions in the past three years. But what is most remarkable is the following chart from Bloomberg which shows the year-to-date return of the best performing asset between US and global equities, corporate bonds, Treasuries, gold and real cash, and according to which 2018 is shaping up as what may be the worst year on record for cross-asset investors. Indeed, nothing at all has worked this year!

The inability of any single asset class to escape the dismal black hole supergravity of devastating losses in a brutal post-BTFD catharsis that has mutated into an equal-opportunity rout, crushing returns across all assets, has left investors reeling, shellshocked and paralyzed, and dreading what may come tomorrow let alone next year when both the US economy and corporate earnings are expected to see their supercharged recent growth rates come crashing back down to earth. “While there’s still no ‘panic in the streets,’ most traders are unconvinced that the selling will slow down anytime soon,” said Instinent’s head of trading Larry Weiss. “The flight to quality is now a flight to cash. It’s tough to convince anyone that now is the time to put money to work.”

[..] Hedge funds, who hoped that “buy the dip” would work one last time and who rushed into the traditional “safety” of tech stocks at the end of October, were whipsawed, and turned net sellers this month, with the group accounting for the most selling among major industries according to Goldman Sachs. Meanwhile, as if sensing the coming storm, Goldman writes that hedge fund net exposures steadily declined throughout 2018, including during 2Q and 3Q while the broad equity market rallied, leaving most investors in the cold. Net long exposure calculated based on 13-F filings and publicly-available short interest data registered 49% at the start of 4Q, a decline from 56% at the start of 2018, and one of the lowest in years.

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Potential volatility in oil is huge. Any little shrapnel of news, Saudi, Iran, Russia, shale, can force prices up 50%.

A Death Cross Is Forming In US Oil (MW)

Oil is already in a bear market, but now a fresh, negative pattern is crystallizing in the commodity that has absolutely bludgeoned bulls over the past two months. January West Texas Intermediate crude on its first full session as the front-month contract, was down a whopping 7.5%, to $52.91 a barrel on the New York Mercantile Exchange and that downtrend has propelled the U.S. benchmark to the brink of forming a death cross—a chart formation in an asset that many market technicians believe marks the point that a short-term decline morphs into a longer-term downtrend (see chart below).

Based on the continuous chart for the most-active oil contract, the 50-day moving average at $67.58 a barrel is less than 0.5% shy of falling beneath the long-term 200-day moving average at $67.25, according to FactSet data. At the current rate of decline, a death cross could occur within a week or two. Both the U.S. contract and the global benchmark Brent oil are in bear market, usually characterized as a decline of at least 20% from a recent peak. In fact, U.S. oil is down 31% from its Oct. 3 peak at $76.41 a barrel.

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Miners are ditching their equipment.

Bitcoin Plunges As Much As 16% To Below $4,100, A New Low For The Year (CNBC)

Bitcoin is still struggling to find a bottom this week. The digital currency dropped as much as 16 percent on Tuesday to its lowest level since Sept. 30, 2017, according to data from CoinMarketCap.com. Bitcoin fell as low as $4,076.59, bringing its total losses in seven days to roughly 30 percent. The cryptocurrency briefly pared those losses and was down about 7 percent in afternoon trading. As U.S. stock markets closed though, bitcoin was still down 12 percent over 24 hours, trading near $4,299, according to data from CoinDesk.

The price plunge came after weeks of rare stability for the world’s largest and best-known cryptocurrency. While global markets churned in October, bitcoin traded comfortably in the $6,400 range — a break from volatility earlier this year. Its total losses this year are now more than 65 percent. ts epic rise last year started right after Thanksgiving as it began to gain status as a household name. Since then, the cryptocurrency has fallen more than 40 percent. Bitcoin first topped $10,000 at the end of November and made it to nearly $20,000 a week before Christmas as retail investors poured in and two regulated exchanges prepared to launch futures markets.

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“With share repurchases in these companies being almost three times their actual investment, one must wonder how much actual U.S. economic growth they are expecting.”

Misguided Share Buybacks Are Hollowing Out Companies’ Balance Sheets (MW)

GE was one of Wall Street’s major share buyback operators between 2015 and 2017; it repurchased $40 billion of shares at prices between $20 and $32. The share price is now $8.60, so the company has liquidated between $23 billion and $29 billion of its shareholders’ money on this utterly futile activity alone. Since the highest net income recorded by the company during those years was $8.8 billion in 2016, with 2015 and 2017 recording a loss, it has managed to lose more on its share repurchases during those three years than it made in operations, by a substantial margin. Even more important, GE has now left itself with minus $48 billion in tangible net worth at Sept. 30, with actual genuine tangible debt of close to $100 billion.

As the new CEO Larry Culp told CNBC last Monday: “We have no higher priority right now than bringing those leverage levels down.” The following day, GE announced the sale of 15% of its oil services arm Baker Hughes, for a round $4 billion. Of course, since that sale values Baker Hughes at $26 billion, and GE paid $32 billion for 62% of Baker Hughes as recently as last year, which looks to me like a valuation for the whole company of $52 billion, GE shareholders appears to have lost half the value of their investment in Baker Hughes in about 18 months. [..] A recent Financial Times article outlined how the five tech companies with the most cash (Apple, Alphabet, Cisco, Microsoft and Oracle) have repurchased an astounding $115 billion of stock in the first three quarters of 2018.

By contrast, the total capital spending of the five companies was only $42.6 billion during the same period. The story then congratulated investors for having done so well out of President Trump’s tax reform, which lowered the corporate tax rate, thus encouraging investment in the United States. With share repurchases in these companies being almost three times their actual investment, one must wonder how much actual U.S. economic growth they are expecting. [..] These share repurchases are misguided in so many ways. First, Apple, Alphabet and Microsoft are valued by the stock market at close to $1 trillion, levels no company has ever reached before. If you ignore the current stock price, a company repurchasing its shares is simply giving away its cash and reducing its share count; it creates no value.

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Dangerously close to a political statement.

Bank of England Backs Theresa May’s Brexit Deal, Warns Of No-Deal Dangers (G.)

Mark Carney has thrown his weight behind Theresa May’s Brexit deal, warning that a no-deal scenario would damage the economy, trigger job losses, lead to lower pay for workers and cause inflation to rise. The governor of the Bank of England said May’s draft EU withdrawal agreement would “support economic outcomes” that would be positive for the British economy, primarily because it would give Britain more time to prepare for whatever final Brexit deal is agreed between Westminster and Brussels. “We welcome the transition arrangements in the withdrawal agreement. It’s at the heart [of the deal],” he told MPs on the Treasury select committee, a week after the prime minister agreed the terms of the deal with the EU.

“[The deal] improves our ability to discharge our function relative to having no deal,” he added. The timing of the governor’s comments could help to support May as she faces tough opposition from across the political divide, following cabinet resignations and Labour’s promise to vote it down in parliament. Carney warned that failure to agree a Brexit deal with Brussels before the March 2019 deadline would deliver a “large negative shock” to the UK economy that would have a persistent effect, lowering growth and causing job losses. He said such an outcome would deliver an “unprecedented supply shock” to the UK economy with few historical or international comparisons. “It wouldn’t be a happy situation to be in,” he said.

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These talks should have started two years ago. And even then.

May’s Brussels Trip Only Start Of ‘Endless’ EU Trade Talks (G.)

When Theresa May goes to Brussels for tea with Jean Claude Juncker on Wednesday afternoon, the two leaders will have in front of them a metaphorical Christmas tree of a political declaration. “And every member state has put a bauble on it”, an EU diplomat said. A seven-page document published last week, offering some heads of terms on the future relationship, is set to more than double to some 20 pages. Calls for more ambitious language around the trade elements have been made. Demands for a Spanish veto over any deal covering Gibraltar have been tabled. And an array of asks on so called “level playing field” commitments in any future trade deal are in the mix.

There is even talk of side-declarations to the political declaration emerging at the special Brexit summit next Sunday to allow member states to feel that they have drawn a line in the sand about the real trade talks to come. “It’s all getting very confusing,” admitted a second EU diplomat. Not to Sir Andrew Cahn, the former chief executive of the government’s UK Trade & Investment (UKTI) department, who was also an aide to Neil Kinnock when vice president of the European commission in the late 1990s. This is, he said, likely to be a mere amuse-bouche to the “continuous endless” talks that will open on the UK’s trading relationship with Brussels after 29 March 2019 as the UK finds its way around the EU’s orbit.

“It is a classic EU negotiation and the member states are performing their normal way,” Cahn said. “The French always come in late to toughen their negotiating position towards the end, and that’s when they can get some additional things. “The Spanish are copying with Gibraltar – although that is partly a function of domestic Spanish politics with Pedro Sánchez [the Spanish prime minister] being vulnerable at home.”

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What, she didn’t tell you?

UK To Be ‘Frozen Out’ Of 182 EU Decisions During Brexit Transition (Ind.)

The UK will be “frozen out” of EU decisions on no fewer than 182 new rules in the months after Brexit, a new analysis says, including over budget spending, road signs and drinking water. The full scale of fresh regulations in the pipeline – during Theresa May’s planned 21-month transition period – exposes the blunder of making Britain “a rule-taker, not a rule-maker”, it warns. During that transition, the UK will be bound by Brussels’ decisions but without any ministers in the EU council, or MEPs in the European parliament, to influence them. Now the campaign for a People’s Vote on the Brexit outcome has examined the decisions expected before 2020, which also include alcohol-taxing and rules for UK investment funds.

“This analysis sets out for the first time the full scale of the UK’s capitulation under this so-called deal,” said Chris Bryant, a Labour supporter of People’s Vote. “The prime minister’s deal would weaken our ability to have a say in over 180 crucial decisions that are going to be made in Europe while the UK is in transition – meaning we have to abide by their rulings but have no say and no ability to protect Britain’s interests. “This dodgy deal will leave Britain frozen out of decision making and forced to pay billions of Euros for the privilege.” The argument goes to the heart of criticism – by both pro and anti-Brexit MPs – that the UK will be a “vassal state” during the transition phase.

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Russophobia continues unabated.

Interpol Elects South Korean As Its President In Blow To Russia (G.)

South Korea’s Kim Jong-yang has been elected as Interpol’s next president, edging out a longtime veteran of Russia’s security services who was strongly opposed by the US, Britain and other European nations. The White House and its European partners had lobbied against Alexander Prokopchuk’s attempts to be named the next president of the international police body, saying his election would lead to further Russian abuses of Interpol’s “red notice” system to go after political opponents. Prokopchuk is a general in the Russian interior ministry and serves as an Interpol vice-president. Kim was chosen by Interpol’s 94-member states at a meeting of its annual congress in Dubai.

He will serve until 2020, completing the four-year mandate of his predecessor, Meng Hongwei, who went missing in his native China in September. Beijing later said Meng resigned after being charged with accepting bribes. Critics say that Prokopchuk oversaw a policy of systematically targeting critics and dissidents during his time in charge of the Russian office of Interpol. On Tuesday, the US secretary of state, Mike Pompeo, threw his weight behind Kim, who is the acting president of the global police body. “We encourage all nations and organisations that are part of Interpol and that respect the rule of law to choose a leader with integrity. We believe Mr Kim will be just that,” Pompeo told reporters.

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If only we move to recycled plastic! Geez, Louise, how about no plastic at all? You can cut at least 50% without changing anything much at all. More recycling is a fake message.

Tax ‘Virgin Packaging’ To Tackle Plastics Crisis – Report (G.)

The government should introduce a new tax on virgin packaging to revolutionise the recycling system in the UK and tackle the plastics crisis, according to a new report. The study, presented to MPs and industry figures at Westminster on Tuesday evening, calls on ministers to impose a fee on packaging materials and offer a rebate for those products that use more recycled material. The WWF and the Resource Association, which commissioned environment consultancy Eunomia to produce the report, said the proposals would transform the UK’s broken recycling system – and drastically reduce the demand for raw materials, including fossil fuels. Dr Lyndsey Dodd, head of marine policy at WWF UK, said: “Our oceans are choking on plastic, 90% of the world’s sea birds have fragments of plastic in their stomach.

Despite the public outcry, more products are being made with virgin, or new, plastic than with recycled plastic.” Last year the Guardian revealed that plastic production is set to increase by 40% over the next 10 years as fossil fuel companies look to use raw materials produced by fracking in the US. The new report follows an announcement in October that the government is launching a consultation on the introduction of a tax on all plastic packaging with a recycled content of less than 30%. [..] Earlier this year the Guardian reported the plastics recycling industry was under investigation for suspected widespread abuse and fraud within the export system. Since China banned the import of plastic waste, the UK has been chasing other markets in Malaysia, Vietnam and Thailand, but these countries are also imposing restrictions due to the stockpiling of waste.

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“..115 plastic cups, four plastic bottles, 25 plastic bags, two flip-flops, a nylon sack and more than 1,000 other assorted pieces of plastic..”

Dead Whale Washes Ashore In Indonesia With 6 Kilos Of Plastic In Stomach (AP)

A dead whale that washed ashore in eastern Indonesia had a large lump of plastic waste in its stomach, including drinking cups and flip-flops – causing concern among environmentalists and government officials in one of the world’s largest plastic polluting countries. Rescuers from Wakatobi National Park found the 9.5-metre sperm whale late on Monday in waters near Kapota Island, southeast of Sulawesi, after receiving a report from environmentalists that villagers had surrounded the dead creature and were beginning to butcher its rotting carcass, park chief Heri Santoso said. Researchers from wildlife conservation group WWF and the park’s conservation academy found about 5.9 kilograms of plastic waste in the animal’s stomach – including 115 plastic cups, four plastic bottles, 25 plastic bags, two flip-flops, a nylon sack and more than 1,000 other assorted pieces of plastic.

“Although we have not been able to deduce the cause of death, the facts that we see are truly awful,” said Dwi Suprapti, a marine species conservation coordinator at WWF Indonesia. She said it was not possible to determine if the plastic had caused the whale’s death because of the animal’s advanced state of decay. Indonesia, an archipelago of 260 million people, is the world’s second-largest plastic polluter after China, according to a study published in the journal Science in January. It produces 3.2 million tonnes of mismanaged plastic waste a year, of which 1.29 million tonnes ends up in the ocean, the study said.

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Can we say the MSM wakes up with this USA Today piece?

Julian Assange Deserves A Medal of Freedom, Not A Secret Indictment (USA Today)

On the same day the Assange indictment scored headlines, Trump awarded seven Presidential Medals of Freedom. No controversy greeted posthumous awards to Babe Ruth and Elvis Presley — unlike the ruckus regarding Miriam Adelson, wife of Republican super-donor Sheldon Adelson. Public Citizen, a liberal nonprofit, howled that the Adelson award “is just the latest sign of [Trump’s] ability to corrupt and corrode all aspects of the government.” New York Times columnist Paul Krugman caterwauled that it was “ludicrous” and “and an insult to people who received the medal for genuine service.” In reality, Presidential Medals of Freedom have routinely been exploited to buttress the political establishment, with bevies of awards for political operators, members of Congress, and pliable foreign leaders.

President Lyndon Johnson distributed a bushel of Medals of Freedom to his Vietnam War architects and enablers, perhaps as consolation prizes for losing the war. (The medal awarded to Defense Secretary Robert McNamara, whose lies about the war making progress cost thousands of Americans and Vietnamese their lives, fetched $40,625 at an auction a few years ago.) President George W. Bush conferred Medals of Freedom on his Iraq war team, including CIA chief George “Slam Dunk” Tenet, Iraq viceroy Paul Bremer, and ambassador Ryan Crocker, whom Bush called “America’s Lawrence of Arabia.”

Some of the biggest fabulists of the modern era — including Henry Kissinger and Dick Cheney — also pocketed the award.The controversies over Assange and Adelson provide a serendipitous opportunity to update the freedom awards. Because few things are more perilous to democracy than permitting politicians to coverup crimes, there should be a new Medal of Freedom category commending individuals who have done the most to expose official lies. This particular award could be differentiated by including a little steam whistle atop the medal — vivifying how leaks can prevent a political system from overheating or exploding.

Assange would deserve such a medal — as would Thomas Drake and Edward Snowden (who revealed NSA’s abuses), John Kiriakou (who revealed CIA torture), and Daniel Ellsberg (who leaked the Pentagon Papers). Admittedly, there may be no way to stop presidents from giving steam whistle freedom awards to political donors’ wives. Organizations like Wikileaks are among the best hopes for rescuing democracy from Leviathan. Unless we presume politicians have a divine right to deceive the governed, America should honor individuals who expose federal crimes.

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Nov 042018
 
 November 4, 2018  Posted by at 10:53 am Finance Tagged with: , , , , , , , , , ,  5 Responses »


Francisco Goya The straw mannequin 1791-92

 

Where the Heck are Share Buybacks in This Rotten Market? (WS)
Corporate Buybacks Return, Supporting Market (WSJ)
US Mortgage Rates Rise Sharply to Fresh 7-Year Highs (MND)
Theresa May’s ‘Secret’ Brexit Deal (Ind.)
Brexit Puts Good Friday Agreement At Risk – Irish PM (Ind.)
UK Business Leaders Call For Second Brexit Vote (BBC)
Brexit Is Just A Sideshow For An EU Beset By Problems On All Sides (G.)
“Posh Ghost Towers”: Gloom Spreads Over London Housing Market (DQ)
33 Trillion More Reasons Why New York Times Gets Russiagate Wrong (CN)
Break-in Attempted at Assange’s Residence in Ecuador Embassy (CN)

 

 

No blackout, no market. Only deceit.

Where the Heck are Share Buybacks in This Rotten Market? (WS)

Shares fell today in part because Apple, the giant in the indices, gave iffy guidance for the holidays Thursday evening; and with product sales not going anywhere, and only price increases boosting revenues, it said it would no longer disclose unit sales. This combo worked like a charm, and shares dropped 6.6%. So where are the corporate share buybacks when you need them? This is when companies buy back their own shares in order to prop up their price and thereby the overall market. Where is this panacea that was considered securities fraud until 1982? Throughout October, Wall Street gurus promised that shares would rise as soon as companies emerged from their “blackout” period that prevents them from buying back their shares. Alas, there is no federally mandated “blackout” period.

[..] Let’s take a gander at International Business Machines [IBM], one of the biggest share buyback queens. Since 2000, it blew $146 billion on share buybacks. The chart below shows the cumulative amounts since 2013 that IBM wasted on share buybacks: $43 billion (data via YCharts):

Wall Street gurus keep hyping that share buybacks “unlock shareholder value,” or “return cash to shareholders,” or some such thing. But here’s what IBM’s share buybacks did to shareholder value, as measured by the stock price:

[..] IBM has been buying back the shares it issued its own executives as part of their stock compensation plans, and the shares it issued to buy other companies, including minuscule privately-owned startups for billions of dollars. Buybacks covered up the dilutive effects from those actions. IBM could have spent this money on research and invented something cool. But that would have been too hard. Far better to farm out much of the work to cheap countries like India, shut down US operations, waste money on share buybacks in a vain effort to manipulate up its shares, and instead watch them go to heck.

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There are no functioning markets without price discovery, so what exactly is supported here? Deceit?

Corporate Buybacks Return, Supporting Market (WSJ)

U.S. companies are ramping up share buybacks again, offering potential support to volatile markets. Share buybacks fell ahead of earnings season, when regulations bar such repurchases. As that so-called blackout period ends, there has been a resurgence, with companies making the most of last month’s selloff. That has eased analysts’ concerns that the year’s buyback boom is over. Net buybacks in the month totaled just $12 billion by Oct. 19, but jumped to $39 billion by Oct. 29, according to estimates from JPMorgan Chase & Co. That is more than the $30 billion recorded in September and just under the $48 billion recorded in August.

The bank’s estimates are based on the average drop in share count across the S&P 500, FTSE Russell1000, Datastream U.S. and MSCI U.S. indexes. Some analysts hope a resurgence in buybacks could help support share prices during a period of geopolitical and economic uncertainty. Others are skeptical that companies can continue purchasing their own shares at the current pace, particularly as the stream of repatriated cash that helped drive the year’s buybacks slows down. “It is possible that some companies saw the equity correction as an opportunity to buy back their stock” in October, said Nikolaos Panigirtzoglou, global-markets strategist at JPMorgan. “But this raises the hurdle for November.”

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Great jobs numbers equals higher rates.

US Mortgage Rates Rise Sharply to Fresh 7-Year Highs (MND)

Mortgage rates had a bad week and an especially bad day following a much stronger-than-expected jobs report. The Employment Situation (the most important piece of labor market data and arguably the most important economic report as far as interest rates are concerned) showed the highest pace of wage growth since before the recession and a surprisingly robust addition of new jobs in October. Strong jobs data is the nemesis of low interest rates and today was no exception. Mortgage rates were already operating fairly close to long-term highs, but today’s move easily took them to new highs. The average lender is now quoting conventional 30yr fixed rates of 5% for relatively ideal scenarios.

Those without a big down payment or without perfect credit/income can expect to see even higher rates. Most lenders ended up recalling the morning’s initial rate sheets and reissuing higher rates at least once today. There’s really no silver lining apart from the fact that the higher rates go, and the quicker they get there, the closer we get to the point that the economy slows down as a result. When that happens, rates will begin to fall before just about anything else. Unfortunately, the expected time frame for such things is incredibly wide (not the sort of thing you hope for if you need to buy/refi). And yes… it’s also unfortunate that our one source of solace at the moment involves an economic downturn, but if you want low interest rates, that tends to come with the territory.

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The wool over your eyes.

Theresa May’s ‘Secret’ Brexit Deal (Ind.)

Theresa May has reportedly secured concessions from Brussels to keep the whole of the UK in a customs union in the wake of Britain’s withdrawal from the European Union. The agreement reached would prevent the need for Northern Ireland to be treated differently from the rest of the UK, a main stumbling block during Brexit negotiations. The “secret” deal would avoid the need for an Irish backstop and will be written into the legally-binding deal, according to The Sunday Times. However, Downing Street has poured cold water on the report, calling it speculation. The EU has reportedly suggested a backstop post-Brexit customs arrangement covering all of the UK could give mainland Britain some scope to set trade rules.

Preparations for a final deal were far more advanced than previously disclosed, the report said, and would lead to a document of 50 pages or more being published. The agreement would include an “exit clause” designed to convince Brexit-supporting MPs that remaining in the customs union was only temporary, The Sunday Times said. Ms May’s cabinet would meet on Tuesday to discuss her plan, and she hoped there would be enough progress by Friday for the EU to announce a special summit, the newspaper reported. The prime minister’s office has described the report as speculation, but claimed the majority of a deal on Britain’s exit from the bloc in March 2019 had been agreed.

“This is all speculation,” a spokesman for Ms May said. “The prime minister has been clear that we are making good progress on the future relationship and 95 percent of the withdrawal agreement is now settled and negotiations are ongoing.”

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Peace in Ireland is the no.1 concern.

Brexit Puts Good Friday Agreement At Risk – Irish PM (Ind.)

Brexit is “fraying” the relationship between the UK and Ireland and putting peace in Northern Ireland at risk, Irish premier Leo Varadkar has said. The Taoiseach said the Good Friday Agreement was being “undermined” by fractious relations between the two countries over how the Northern Irish border should be managed once Britain leaves the EU. It comes just a day after Theresa May’s de facto deputy, David Lidington, travelled to Dublin to hold talks with his Irish counterpart, Simon Coveney, in a bid to improve relations between the two governments.

But speaking within hours of the visit, Mr Varadkar described the relationship between the two countries as “fraying”. He told Irish broadcaster RTE: “Brexit has undermined the Good Friday Agreement and is fraying the relationship between Britain and Ireland. “Anything that pulls the communities apart in Northern Ireland undermines the Good Friday Agreement, and anything that pulls Britain and Ireland apart undermines that relationship.” The warning comes despite Mr Coveney having claimed a deal between the UK and the EU was “very close”.

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Many sides will call for this.

UK Business Leaders Call For Second Brexit Vote (BBC)

More than 70 business leaders have signed a letter to the Sunday Times calling for a public vote on the UK’s Brexit deal. The chief executive of Waterstones and former Sainsbury’s boss Justin King are among those saying a “destructive hard Brexit” will damage the UK economy. A group called Business for a People’s Vote will launch on Thursday. A Downing Street source told the BBC the Prime Minister was clear that there would be no new referendum. The letter was coordinated by The People’s Vote campaign, which wants a ballot on whether to accept the terms of the UK’s departure from the EU. Richard Reed, co-founder of Innocent Drinks, Lord Myners, the former chairman of Marks and Spencer and Martha Lane Fox, the founder of Lastminute.com, also signed the letter.

It reads: “The business community was promised that, if the country voted to leave, there would continue to be frictionless trade with the EU and the certainty about future relations that we need to invest for the long term. “Despite the Prime Minister’s best efforts, the proposals being discussed by the government and the European Commission fall far short of this. “The uncertainty over the past two years has already led to a slump in investment.” The letter concludes: “We are now facing either a blindfold or a destructive hard Brexit. “Given that neither was on the ballot in 2016, we believe the ultimate choice should be handed back to the public with a People’s Vote.”

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The only true Brezit reality. Merkel’s departure is a far bigger issue for Europe.

Brexit Is Just A Sideshow For An EU Beset By Problems On All Sides (G.)

There is a weariness to the coterie of diplomats and officials based in Brussels intimately involved in the negotiations over the United Kingdom’s withdrawal from the European union. Privately they describe it as “Brexit fatigue”, the result of second-guessing a chaotic situation in Westminster for two years, and working through the summer in response to the demand from the Brexit secretary, Dominic Raab, for continuous negotiations. These officials from the 27 other EU member states were picked as the brightest and the best for the existential crisis of the time, but the hard truth for these ambitious men and women is that the crisis in question is no longer Brexit.

“You go to the capitals, you can see that, because no one talks about it any more,” said Fabian Zuleeg, chief executive of the leading EU thinktank, the European Policy Centre. Speaking to his parliament on his return to Madrid from the recent leaders’ summit in Brussels, Spain’s prime minister, Pedro Sánchez, put it succinctly: “The British spend 24 hours a day thinking about Brexit and the Europeans think about it for four minutes every trimester.” While the UK’s chaotic withdrawal has become a dreary process to be managed, the EU is being dealt hammer blows from elsewhere – from crises that really could make or break the bloc, along with many diplomatic careers.

Foremost on the list of problem zones right now is Italy. “Nothing and nobody, no big or small letter will make us backtrack,” the country’s deputy prime minister, Matteo Salvini, and leader of the far-right League, told his followers in a Facebook video made in his office in Rome on Friday. “Italy will no longer be a slave and will no longer kneel down.”

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Let’s build a few highways to nowhere too.

“Posh Ghost Towers”: Gloom Spreads Over London Housing Market (DQ)

After decades of mind-boggling growth, home prices in metropolitan London, according to official numbers, started to fall this year, if barely. Between March and September, they slid 2.3%. But it’s a lot worse in the most expensive parts of the city: Prices in central London have already dropped 15% since 2014, according to James Hyman, head of the residential agency division at Cluttons. He expects another 7% drop over the next year and a half. And the total volume of transactions has fallen by a fifth, according to Residential Analysts. In 2014, a change in the stamp duty made buying high-end homes in the UK more costly. In London, the city that hosts the highest number of super-rich individuals per capita in the world, high-end homes are the staple product.

And it’s getting harder and harder to offload them: The Guardian reported that over half of the 1,900 ultra-luxury apartments built in London last year failed to sell. This freeze at the high end is fueling concerns that the city would be left with dozens of “posh ghost towers.” The newest phantom skyscraper is London’s Centre Point Tower, a 33-story office building from the 1960s that was recently converted into multi-million-pound luxury apartments. But demand is anemic and the developer behind the project, Almacantar, has all but given up trying to sell the flats after receiving too many “detached from reality” lowball offers. Until conditions improve, half of the tower’s 82 flats will lie empty.

Yet even as demand for upscale real estate in London fades, there’s little sign of any slow down in the construction of luxury apartments, meaning there will be an even greater glut of upscale real estate in the near future. That’s likely to further exacerbate the fall in prices. It’s the latest in a long line of reality checks for London. Clearly, those at the thin upper crust of the global wealth and income scale — just about the only people left who can afford to buy residential property in London these days — either have less money to spend on over-priced high-end London real estate or are splashing it elsewhere, including in other parts of the UK.

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Russiagate is a non-story kept alive by papers and TV stations.

33 Trillion More Reasons Why New York Times Gets Russiagate Wrong (CN)

Even more damning evidence has come to light undermining The New York Times‘ assertion in September that Russia used social media to steal the 2016 election for Donald Trump. The Times‘ claim last month that Russian Facebook posts reached nearly as many Americans as actually voted in the 2016 election exaggerated the significance of those numbers by a factor of hundreds of millions, as revealed by further evidence from Facebook’s own Congressional testimony. Further research into an earlier Consortium News article shows that a relatively paltry 80,000 posts from the private Russian company Internet Research Agency (IRA) were engulfed in literally trillions of posts on Facebook over a two-year period before and after the 2016 vote.

That was supposed to have thrown the election, according to the paper of record. In its 10,000-word article on Sept. 20, the Times reported that 126 million out of 137 million American voters were exposed to social media posts on Facebook from IRA that somehow had a hand in delivering Trump the presidency. The newspaper said: “Even by the vertiginous standards of social media, the reach of their effort was impressive: 2,700 fake Facebook accounts, 80,000 posts, many of them elaborate images with catchy slogans, and an eventual audience of 126 million Americans on Facebook alone.” The paper argued that 126 million was “not far short of the 137 million people who would vote in the 2016 presidential election.”

But Consortium News, on Oct. 10, debunked that story, pointing out that reporters Scott Shane and Mark Mazzetti failed to report several significant caveats and disclaimers from Facebook officers themselves, whose statements make the Times’ claim that Russian election propaganda “reached” 126 million Americans an exercise in misinformation. [..] only an estimated 29 million FB users may have gotten at least one story in their feed in two years. The 126 million figure is based only on an assumption that they shared it with others, according to Stretch. Facebook didn’t even claim most of those 80,000 IRA posts were election–related. It offered no data on what proportion of the feeds to those 29 million people were.

In addition, Facebook’s Vice President for News Feed, Adam Moseri, acknowledged in 2016 that FB subscribers actually read only about 10 percent of the stories Facebook puts in their News Feed every day. The means that very few of the IRA stories that actually make it into a subscriber’s news feed on any given day are actually read.

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Completely insane. Next time it might be police, military, mercenaries. Julian’s supporters need to stand watch 24/7 now.

Break-in Attempted at Assange’s Residence in Ecuador Embassy (CN)

An attempted break-in at Julian Assange’s residence inside the Ecuadorian Embassy in London on Oct. 29, and the absence of a security detail, have increased fears about the safety of the WikiLeak’s publisher. Lawyers for Assange have confirmed to activist and journalist Suzie Dawson that Assange was awoken in the early morning hours by the break-in attempt. They confirmed to Dawson that the attempt was to enter a front window of the embassy. A booby-trap Assange had set up woke him, the lawyers said. Scaffolding has appeared against the embassy building in the Knightsbridge section in London which “obscures the embassy’s security cameras,” the lawyers said.


Scaffolding near balcony where Assange has appeared. (Sean O’Brien)

On the scaffolding electronic devices, presumably to conduct surveillance, can be seen, just feet from the embassy windows. Later on the day of the break-in, Sean O’Brien, a lecturer at Yale University Law School and a cyber-security expert, was able to enter the embassy through the front door, which was left open. Inside he found no security present. Someone from the embassy emerged to tell him to send an email to set up an appointment with Assange. After emailing the embassy, personnel inside refused to check whether it had been received or not. O’Brien then noticed more scaffolding being erected and observed the devices, which he photographed. Though a cyber-security expert, O’Brien said he could not identify what the devices are.


One of the apparent surveillance devices. (Sean O’Brien.)

“I’ve never seen devices quite like this, and I take photos of surveillance equipment often,” O’Brien said. “There were curious plastic tubes with yellow-orange caps, zip-tied to the front. I have no idea what these are but they seem to have equipment inside them.” The devices are pointed towards the embassy, where all the blinds were open, and not the street, he said. “The surveillance devices in the photos reveals no manufacturer branding, serial numbers or visible device information,” Dawson said. “The combination of the obscuring of the street-facing surveillance cameras and the installation of surveillance equipment pointed into instead of away from the Embassy, is alarming.”

[..] On Thursday the government suddenly barred all access to Assange visitors, including his legal team until next Monday, raising fears that no witnesses could be present should there be an attempt to abduct Assange over the weekend.

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Oct 222018
 
 October 22, 2018  Posted by at 8:56 am Finance Tagged with: , , , , , , , , , , ,  9 Responses »


Vincent van Gogh Autumn landscape with four trees 1885

 

5 Companies That Spent Big On Stock Buybacks As Pension Funding Lagged (MW)
How Everything Has Changed Since Trump Became President (CNBC)
Trump Right To Blame Fed for Next Market Crash – Dave Janda (USAW)
Democrats Slide In Battle For Senate (Hill)
Erdogan Says Will Reveal Details Of Khashoggi Case Tuesday (DS)
No Arms For Riyadh While Khashoggi Questions Remain – Merkel (R.)
Germany Urges Other EU States To Also Stop Arms Exports To Saudi Arabia
Merkel to Resign: ‘Wants To Replace Juncker As European Commission Chief’ (VoE)
Italian Bank Fears Expected To Grow After Debt Downgrade (G.)
Brexit Deal Is 95% Settled, Theresa May To Tell Commons (G.)
Sydney Property Slowdown Bites As Auction Clearance Rates Tumble (G.)

 

 

Madness. Should never be allowed. Why do you have a pension fund when you are free not to contribute to it?

5 Companies That Spent Big On Stock Buybacks As Pension Funding Lagged (MW)

Even as corporate executives engage in a spree of share buybacks to spur stock prices higher, many have eschewed adding to their employee’s pension pots. That’s according to Danielle DiMartino Booth of Quill Intelligence who picked out a few of the more standout firms whose “enthusiasm for funding pensions was subpar compared to buybacks.” She lined up five of the worst offenders to illustrate that in the pursuit of higher stock prices and shareholder value corporations often left other pressing needs to languish. They include the likes of Boeing, General Electric and Lockheed Martin. In the chart below, the amount of buybacks and pension contributions between 2009 and 2017 for the five companies is compared alongside their respective pension funding ratio, which represents how much the company can deliver on its future pension obligations as a percentage of the plan’s total assets.

One case Booth highlights in the chart is American Airlines. Though, the airline carried around $18.3 billion of pension obligations, its pension system was only 62% funded even after a nine-year bull market. Market participants have cited the prevalence of share repurchases to the stock market’s searing rise in the past few years, even as equities retreated from their record highs in October. A report by Goldman Sachs said share buybacks could hit a record $1 trillion this year, nearly doubling last year’s haul.

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For now.

How Everything Has Changed Since Trump Became President (CNBC)

Since Donald Trump won the presidency, he has presided over both one the most tumultuous political times in recent memory, as well as the best economy the country has seen since well before the financial crisis. Consumer and small business confidence is up — but so are both the national debt and budget deficit. The chart below, using mostly data compiled by Goldman Sachs, quantifies just how much things changed from the days just before the election in November 2016 through September 2018. Of course, the stock market has weakened in October, which has been its historically most volatile month. The chart doesn’t include GDP, which has averaged 2.72 percent since Trump took over, compared to the 1.6 percent gain in 2016. But the numbers provide a solid overview of how conditions have evolved during the 45th president’s time in office.

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No, it’s the low interest rates that will cause a market crash. It’s the manipulation.

Trump Right To Blame Fed for Next Market Crash – Dave Janda (USAW)

Radio host Dr. Dave Janda says everybody in Washington knows the next big crash is right around the corner. It’s been 10 years since the Fed reflated the last meltdown, and Dr. Janda says President Trump is already blaming the Federal Reserve for killing the economy that his policies revived. Dr. Janda explains, “President Trump has been pointing the finger at the Fed. He’s been pointing the finger at the Fed, and that is exactly where he should be pointing. The globalist syndicate’s tentacle is the central banking system, and, in particular, in the United States, the Federal Reserve. The Federal Reserve is one of the entities that is directly responsible for this financial mess our country is currently in.

You would never see Obama or the Bushes, or Bill Clinton, point at the Fed and say what Trump has said. Trump said, ‘I think the Fed has gone crazy. I think the Fed is making a mistake. They’re so tight with interest rates. I think the Fed has gone crazy.’ Just the other day, Trump said, ‘My biggest threat is the Fed. . . . The Fed is raising rates too fast, and it’s too independent.’ Now, wait a minute, listen to that. It’s too independent. When was the last time a president of the United States said the Fed was too independent? . . . . Banking groups, that is their priority. So, when the President says the Fed is raising rates too fast, and it’s my biggest enemy, and too independent, what he is saying is they are looking out for their own interests.

They are not looking out for the interests of our country or for you or for me or for any American, and he’s right. I don’t know of any other president that has had the guts to say this.” So, what happens next? Dr. Janda says, “Trump knew this thing was rigged to blow, the economy, the financial system, and when the right time came, he would start pointing the finger at the globalists, the Fed. I believe that’s where we are right now.”

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As predicted.

Democrats Slide In Battle For Senate (Hill)

The battle for control of the Senate is looking worse and worse for Democrats, who just a month ago saw a path to the majority but now increasingly look like they could lose more seats and have a smaller minority next year. Republicans have seen a bump in the polls in several key races since Labor Day. They believe momentum has flipped to their party since the fight over Supreme Court Justice Brett Kavanaugh polarized the electorate, hurting Democrats running for reelection in states where President Trump is popular. Two states where Democrats had hopes of pulling major upsets — Texas and Tennessee — have moved in favor of Republicans.

Races in Nevada and Arizona, two other states where Democrats had hoped to make gains, remain tight, but Republicans feel more confident about their candidates. Meanwhile, the tide has moved against Democratic candidates in a couple of states that Trump won by double digits in 2016. In North Dakota, Democratic Sen. Heidi Heitkamp has fallen behind by double digits. And in Montana, Sen. Jon Tester (D), who seemed poised for victory a month ago, has seen his race tighten amid attacks by the president. There is some good news for Democrats in the polls. Sen. Joe Manchin (D-W.Va.), the only Democrat to back Kavanaugh’s confirmation, has maintained a healthy average lead of 9 points in the polls, despite running in a state that Trump won by a whopping 42 points in 2016.

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Do the US and Riyadh know what he knows?

Erdogan Says Will Reveal Details Of Khashoggi Case Tuesday (DS)

President Recep Tayyip Erdogan said Sunday that he will make important statements on Tuesday at the ruling Justice and Development Party’s (AK Party) parliamentary group meeting regarding the investigation on journalist Jamal Khashoggi’s fate, who was admittedly killed by Saudi authorities. “We seek justice and this will be revealed in all its naked truth, not through some ordinary steps but in all its naked truth. This is not an ordinary case. I will make statements on Tuesday at the AK Party parliamentary group meeting. The incident will be revealed entirely,” said Erdogan at a ceremony in Istanbul.

His comments are likely to heighten speculation that Turkey may be about to reveal some of the results of its investigations into the killing of the dissident journalist [..] Turkish newspapers have released information detailing a 15-member team that purportedly arrived in Istanbul to confront Khashoggi at the consulate. “Why did these 15 people come here (to Istanbul), why were 18 people arrested (in Saudi Arabia)? These need to be explained in detail,” Erdogan said. Saudi Arabia’s public prosecutor on Saturday said 18 people were arrested in connection with the incident. Turkish sources say the authorities have an audio recording purportedly documenting Khashoggi’s murder inside the consulate.

“If the incident transpired as it has been told across the world, there is no way Saudi officials can cover this up by saying a team from Saudi Arabia came and two or three men among them murdered him,” Numan Kurtulmus, deputy chairman of the AK Party, told broadcaster CNN Türk in an interview. “A crime committed in a consulate cannot be carried out without the knowledge of the senior state officials of that country. If this crime was really carried out as has been said, if the evidence really leads to that conclusion, the situation will be dire and this must have very serious legal consequences.”

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Not that Germany sells all that much.

No Arms For Riyadh While Khashoggi Questions Remain – Merkel (R.)

Germany will not export arms to Saudi Arabia while the current uncertainty over the fate of journalist Jamal Khashoggi persists, Chancellor Angela Merkel said on Sunday. Campaigning for her party in a regional election, Merkel repeated to a news conference her earlier condemnation of Khashoggi’s killing, which Saudi Arabia admitted had taken place inside its consulate in Istanbul. “First, we condemn this act in the strongest terms,” she said. “Second, there is an urgent need to clarify what happened – we are far from this having been cleared up and those responsible held to account … As far as arms exports are concerned, those can’t take place in the current circumstances.”

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But look at the UK. Will they stop arms exports?

Germany Urges Other EU States To Also Stop Arms Exports To Saudi Arabia

Germany wants other European Union member states to follow its example in stopping arms exports to Saudi Arabia as long as uncertainty remains over the killing of journalist Jamal Khashoggi, Economy Minister Peter Altmaier said on Monday. Riyadh has given multiple and conflicting accounts on what led to Khashoggi’s death on Oct. 2 at its consulate in Istanbul. On Sunday, Foreign Minister Adel al-Jubeir called the killing a “huge and grave mistake” but sought to shield Saudi Arabia’s powerful crown prince. Chancellor Angela Merkel said on Sunday that Germany would stop arms exports to Saudi Arabia as long as the uncertainty around Khashoggi’s death persisted.

Altmaier, a close ally of Merkel, said Riyadh’s explanations on the case so far had not been satisfactory. “The government is in agreement that we will not approve further arms exports for the moment because we want to know what happened,” Altmaier told ZDF broadcaster. So far this year the German government had approved weapons exports worth more than 400 million euros ($462 million) to Saudi Arabia, making it the second-biggest recipient of German arms after Algeria. [..] Altmaier said other EU states should stop arms exports to Saudi Arabia in order to increase pressure on Riyadh over the Khashoggi case. “For me it would be important that we come to a joint European stance,” Altmaier said.

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A popular job.

Merkel to Resign: ‘Wants To Replace Juncker As European Commission Chief’ (VoE)

Bavaria’s state election last weekend proved painful for German Chancellor Angela Merkel. In yet another election next week, Ms. Merkel is expected to see further discomfiture. The German leader could resign from her post at the December CDU party conference in December in order to take another senior European position. “Rumours are swirling in Brussels that Merkel could run for the European Commission next year”, Die Welt’s Stefanie Bolzen tells the BBC. As Jean-Claude Juncker gets ready to retire as European Commission President next year, there have been suggestions that French President Emanuel Macron is considering a run, Italy’s fierce and most popular politician in Italy’s history Deputy Prime Minister Matteo Salvini has also been asked to run, and now Germany’s Chancellor Angela Merkel could potentially be throwing her hat into the ring.

May the best Italian win!

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What happens when the vigilantes decide it’s time?

Italian Bank Fears Expected To Grow After Debt Downgrade (G.)

Fears that Italy’s banks face a black hole in their finances are expected to grow this week following a debt downgrade that could send the value of bank reserves plummeting. Despite efforts to shore up Italian banks’ reserves, a downgrade by the ratings agency Moody’s on Friday following a row between Rome and Brussels over the government’s budget could send them into freefall again. A senior government official added to the tension on Sunday by issuing a warning that Italy should not ignore the deteriorating financial situation and its effect on the country’s banks, including possible capital needs. Giancarlo Giorgetti said in a newspaper interview that a fire sale of Italian government bonds over the last five months had put huge pressure on bank reserves and could trigger a second crisis in two years.

The budget plans of Italy‘s populist government, which breach EU borrowing rules, have prompted investors to shed €67bn ($77bn) of Italian government bonds since May. The effect has been to push values down and the interest rate on government bonds, referred to as the yield, to more than three percentage points higher than safer German bonds. “The increase in the [bond yield] spread, the amount of public debt banks hold and new European Union banking rules put the industry under pressure and may generate the need to recapitalise the most fragile lenders,” said Giorgetti, who is an influential member of the far-right League, one of the two parties in Italy’s ruling coalition.

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But the remaining 5% were always the hardest, so nothing really changed.

Brexit Deal Is 95% Settled, Theresa May To Tell Commons (G.)

Theresa May will tell the Commons on Monday that 95% of the Brexit withdrawal agreement and its protocols are settled as she seeks to demonstrate to anxious MPs in her own party that she is making headway in the increasingly fraught divorce talks. The prime minister is expected to confirm she has resolved with the EU the future status of Gibraltar, developed a protocol around the UK’s military base in Cyprus and agreed a mechanism for resolving any future disputes with the EU.

Taking the unusual step of briefing planned remarks to the Commons in advance, May will conclude that “taking all of this together, 95% of the withdrawal agreement and its protocols are now settled” in talks that she has until now largely insisted on keeping secret. The prime minister is scheduled to make a statement on Monday afternoon, after intense criticism from the Tory right for appearing to have made no progress other than indicating at last week’s European summit that she was open to extending the post-Brexit transition period, prompting renewed speculation about a leadership challenge.

A clearly rattled Downing Street held two conference calls with cabinet ministers over the weekend to update them on the European summit before a cabinet discussion on Brexit on Tuesday. Concerns were raised about the transition period and time-limiting the Irish backstop. “No one is in the mood to be bounced,” said one cabinet source. May intends to show the progress made by highlighting all the specific areas of agreement already reached, including settling the divorce bill at £39bn, having an implementation period until at least the end of 2020 and recognising the rights of EU citizens living in the UK and vice versa.

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Down under goes further down.

Sydney Property Slowdown Bites As Auction Clearance Rates Tumble (G.)

Sydney’s housing market is facing the toughest conditions since the global financial crisis after auction rates slumped again at the weekend, with analysts predicting that the slowdown could get much worse in the months ahead. Australia’s biggest city saw only 44% of 567 listed properties sold at the weekend, according to Domain, the lowest preliminary clearance rate for a decade. The figure is likely to be revised down below 40%, a level of downturn not seen for a decade. The last time rates were in the 30% range was November 2008, at the peak of the global financial crisis. The two instances before that were May 2004, when New South Wales introduced vendor stamp duty, and July 1989, when interest rates were 17%.

Equally striking is the collapse in the total amount changing hands at auctions across the city, which sank to $160m at the weekend compared with $484m on the same weekend a year ago – a drop of about two-thirds. The decline in the property market, which AMP’s chief economist, Shane Oliver, thinks could fall 20% before bottoming out in 2020, has been most marked in Sydney where prices are down around 6.3% from the peak in 2017 as buyers drop out owing to tougher credit standards and falling confidence. The clearance rate in Melbourne at the weekend was below 50% on a much greater number of properties (nearly 1,000). But the dollar volume of auction sales shows a similar decline across the country, where buyers spent $453m at the weekend compared with $1.3bn the same weekend last year.

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Oct 142018
 


René Magritte The song of love 1948

 

Companies Buying Their Own Shares Could Fuel The Next Market Rally (CNBC)
Market Crash? Another ‘Red Card’ For The Economy (Lacalle)
4 Lessons From Iceland On Dealing With A Financial Crisis (WEF)
‘Crazy’ That Current Account Deficits Are ‘A Sin:’ Singapore Deputy PM (CNBC)
Draghi to Rome: Don’t Expect An ECB Rescue If Budget Talks Fail (CNBC)
Canada ‘Concerned’ About Khashoggi But Will Sell Arms To Saudis – Trudeau (RT)
David Davis Calls For Cabinet Rebellion Over Brexit Plan (BBC)
Brexit Negotiators Poised To Miss Deal Deadline As UK Hardliners Rebel (ZH)
Internet Censorship Just Took An Unprecedented Leap Forward (CJ)
Professor Exposes Rigged Markets One Academic Paper At A Time (ZH)
Hammer Time (Jim Kunstler)
Who The Hell Cares What Old People Think About Climate Change? (Ol.)
What’s Another Way to Say ‘We’re F-cked’? (Goodell)
‘Not Everything Was Looted’: British Museum To Fight Critics (G.)

 

 

“.. in the last 12 months, the companies in the S&P 500 have purchased $646 billion of their own stock, 29 percent more than the previous 12 months..”

“..at least $350 billion of buybacks that have been planned for the year and are just waiting to be put to work.”

Companies Buying Their Own Shares Could Fuel The Next Market Rally (CNBC)

With stocks down significantly, corporate buybacks could help stabilize the market. Buybacks have been one of the big stories supporting the market this year. DataTrek estimates that in the last 12 months, the companies in the S&P 500 have purchased $646 billion of their own stock, 29 percent more than the previous 12 months. And there’s plenty of “dry powder” left. One firm estimates at least $350 billion of buybacks that have been planned for the year and are just waiting to be put to work. And no, it is not just Apple that is buying its own stock. More than 300 large-cap companies have active buyback programs.

Unfortunately, some traders are resurrecting an old chestnut to help explain the current market weakness. They say we are entering a “blackout” period, when corporations cannot buy their stock because they are about to report quarterly earnings. It’s a neat explanation, except there’s not a lot to it. “Buybacks do occur during blackout periods,” Ben Silverman at InsiderScore told me. “Buyback volume does often decline in the first month of the quarter due to some buyback blackouts,” but companies can, and do, continue to buy back stock, he told me. Another trader (who declined to be identified) confirmed Silverman’s point. Corporate buybacks decline in the month before earnings, but only marginally. He estimated the decline is 30 percent or less.

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“..disproportionate valuations…”

$20 trillion worth of them.

Market Crash? Another ‘Red Card’ For The Economy (Lacalle)

The first thing we must understand is that we are not facing a panic created by a black swan, that is, an unexpected event, but by three factors that few could deny were evident: 1) Excessive valuations after $20 trillion of monetary expansion inflated most financial assets. 2) Bond yields rising as the US 10-year reaches 3.2%. 3) The evidence of the Yuan devaluation, which is on its way to surpass 7 Yuan per US dollar. 4) Global growth estimates trimmed for the sixth time in as many months. Therefore, the US rate hikes – announced repeatedly and incessantly for years – are not the cause, nor the alleged trade war. These are just symptoms, excuses to disguise a much more worrying illness.

What we are experiencing is the evidence of the saturation of excesses built around central banks’ loose policies and the famous “bubble of everything”. And therein lies the problem. After twenty trillion dollars of reckless monetary expansion, risk assets, from the safest to the most volatile, from the most liquid to the unquoted, have skyrocketed with disproportionate valuations.

The cracks in the building always appear first with currencies. Countries that have become accustomed to the idea that “this time is different” and that debt does not matter, started to multiply their indebtedness in foreign currency. Debt in dollars from emerging countries soared to 41% of their total debt. In the first three months of 2018, global debt rose 11% to a record of 247 trillion dollars (according to the IIF), and that of emerging markets soared by 2.5 trillion to an all-time high of 58.5 trillion. . When the lowest risk bond, the United States 10-year, went to 3.1%, the synchronized growth and complacent veil lifted, and many assets showed how risky they truly are.

Markets woke up to a reality that we had decided to ignore. That rates do rise. And if the safest bond gives a return of 3.2% … Am I willing to buy bonds from much riskier countries with negligible spreads? Add to that “sobriety” effect, another one. The inevitable devaluation of the yuan , which soared to almost 7 against the dollar. Am I willing to buy emerging markets and commodities when China exports its imbalances sending disinflationary pressure to the rest of the world?

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Iceland took it serious. No-one else did.

4 Lessons From Iceland On Dealing With A Financial Crisis (WEF)

Days after the collapse of 97% of its banking industry, Icelandic authorities designed a comprehensive policy of accountability, based on two overlapping objectives: establishing the truth and punishing those responsible. An independent truth commission was mandated to document the causes of the meltdown, and the newly established Office of the Special Prosecutor was tasked to thoroughly investigate and prosecute those responsible for any crimes committed in the run up to the crisis. Both mechanisms have been remarkably successful.

Published in 2010, the truth commission’s 2,200-page report not only documented the manifold failings of the financial system in Iceland but also offered specific recommendations to protect state institutions from a future crisis. The report instantly became a bestseller, with copies sold in supermarkets. It was a popular gift – parents even gave it to their children to help them avoid making the same mistakes. The Office of the Special Prosecutor successfully prosecuted 40 bank executives. This is remarkable, especially given the small population of the island and the comparative experience of other European countries affected by the recession, such as Ireland, Cyprus, or the UK (table below).

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Not many people see is that way.

‘Crazy’ That Current Account Deficits Are ‘A Sin:’ Singapore Deputy PM (CNBC)

For decades, developing countries have relied on outside investments to boost their growth despite trade imbalances. But running a current account deficit has come to be regarded as “a sin,” according to Singapore’s deputy prime minister. Such a development is just “crazy,” Tharman Shanmugaratnam told CNBC on Friday during the annual meeting of the Institute of International Finance on the Indonesian island of Bali. Shanmugaratnam was referring to the widely held outlook that nations should seek to avoid current account deficits — which indicate they’re operating on borrowed means because the value of incoming goods, services and investments exceeds the amount leaving the country.

“How did the Singapores and Koreas of the world grow?” he said. “We grew by running current account deficits at an early stage of development so we could invest ahead for growth while our savings were being built up.” Singapore was able to rely on financing through foreign direct investments and long-term investors during its early years of growth, as the international financial system at that time had capital flowing to developing economies, Shanmugaratnam said. “Today, it’s a sin to run a current account deficit and that’s crazy,” said the minister, who is also the chairman of the Monetary Authority of Singapore, the country’s central bank and financial regulator. “I mean, it’s bad in economics, it’s bad in policy sense, and the whole world is going to suffer.”

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But Draghi’s still an Italian.

Draghi to Rome: Don’t Expect An ECB Rescue If Budget Talks Fail (CNBC)

European Central Bank President Mario Draghi is sending a warning to Rome ahead of its formal budget submission: Don’t expect the ECB to save the day. In a Saturday press conference at the IMF and World Bank meetings in Bali, Indonesia, Draghi said he was confident that a budget agreement would be reached and urged all parties to “calm down with the tone.” He also voiced relief that there has not been evidence of a wider spillover effect in European bond markets, even as Italian yields hit multi-year highs. “Everything that happened today is local to Italy.”

When asked whether an eventual realization of contagion or a further rise in Italian yields would force the ECB to scrap tightening plans by year end, Draghi told CNBC: “I don’t want to speculate on this. I just don’t want to conceive such a hypothesis. I’m confident that the authorities — and by the way all parties, not only Italy — all parties will in the end find a compromise solution, an agreement.” He went on to suggest that the situation had been “dramatized,” and that was “not the first time there are deviations from established rules in Europe.” But investors are worried that the Italian government may seize on that precedent and take a gamble that running foul of EU budget rules won’t incur serious penalties, and that, if things do turn worse for Italian financial markets, they”ll be able to lean on the ECB for support. Draghi, for his part, told CNBC that would not be a possibility.

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“..Saudi Arabia expelled the Canadian envoy. It then froze trade talks, cut academic ties, and suspended flights to Canada.”

But arms sales trump everything.

Canada ‘Concerned’ About Khashoggi But Will Sell Arms To Saudis – Trudeau (RT)

Ottawa will keep its $15bn arms deal with Riyadh despite concerns over Saudi involvement in the disappearance of dissident journalist Jamal Khashoggi and the diplomatic row over human rights, Prime Minister Trudeau said. “We respected that contract,” Canadian Prime Minister Justin Trudeau told reporters on Friday, adding that his cabinet has put forward measures to make the arms sales more transparent. “We are making sure Canadians’ expectations and laws are always being followed,” he said. The contract was signed in 2014 by the previous conservative government, and has since been upheld by Trudeau. The specifics of the sales were originally not disclosed by the parties.

According to documents obtained by CBC News last month, a Canadian company is to ship 742 LAV-6 light armored vehicles to Riyadh. The same outlet revealed in March that hundreds of the LAV-6s will be outfitted as “heavy assault” and “anti-tank” types. [..] Human rights campaigners and journalists have criticized Canada’s approach to Saudi Arabia as inconsistent. They point out that the government doesn’t mince words when attacking the kingdom’s human rights record, but at the same time never waivers in its willingness to ship military hardware to Riyadh. Media reports have also strongly suggested that the Saudis might be using Canadian-made LAVs against civilians in Yemen.

[..] Canada stuck to the arms deal even after becoming embroiled in a diplomatic spat with Riyadh in August. Foreign Minister Chrystia Freeland called on the kingdom to release two high-profile dissidents. In response, Saudi Arabia expelled the Canadian envoy. It then froze trade talks, cut academic ties, and suspended flights to Canada.

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She won’t have a cabinet left soon.

David Davis Calls For Cabinet Rebellion Over Brexit Plan (BBC)

Cabinet ministers should “exert their collective authority” and rebel against Theresa May’s proposed Brexit deal, ex-Brexit Secretary David Davis has said. The PM has suggested a temporary customs arrangement for the whole UK to remain in the customs union while the Irish border issue is resolved. Brexiteers suspect this could turn into a permanent situation, restricting the freedom to strike trade deals. Writing in the Sunday Times, Mr Davis said the plan was unacceptable. “This is one of the most fundamental decisions that government has taken in modern times,” he added.

The issue of the border between Northern Ireland and the Republic Ireland is one of the last remaining obstacles to achieving a divorce deal with Brussels, with wrangling continuing over the nature of a “backstop” to keep the frontier open if a wider UK-EU trade arrangement cannot resolve it. The EU’s version, which would see just Northern Ireland remain aligned with Brussels’ rules, has been called unacceptable by Mrs May and the DUP. Mr Davis said the government’s negotiating strategy had “fundamental flaws”, arising from the “unwise decision in December to accept the EU’s language on dealing with the Northern Ireland border”.

On Saturday evening, German newspaper Suddeutsche Zeitung reported a deal had already been reached between Mrs May and the EU, and would be announced on Monday. But a No 10 source told the BBC the report was “100%, categorically untrue” and negotiations were ongoing. The paper said it had seen a leaked memo from EU negotiators to EU ambassadors stating: “Deal made.”

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Too many people want too many too different things.

Brexit Negotiators Poised To Miss Deal Deadline As UK Hardliners Rebel (ZH)

[..] early Sunday in London, the Brexiteer hardliners published an open letter signed by 63 Conservative MPs, including David Davis, the former Brexit secretary, Jacob Rees-Mogg, the chairman of the European Research Group of Eurosceptic backbenchers and former Brexit minister Steve Baker, the former Brexit minister. At the same time, Anne-Marie Trevelyan, a pro-leave MP, published an editorial in the Sunday Telegraph demanding that any possibility that the UK could remain in a “temporary customs arrangement” after the Brexit transition period ends in December 2020 be stricken from the final agreement – because leaving open the possibility would be tantamount to ignoring the political will of the 17.4 million Britons who voted for Brexit.

Meanwhile, Davis demanded in an editorial in the Sunday Times that Cabinet ministers should “exert their collective authority” and rebel against Theresa May’s proposed Brexit deal. All of this is happening amid even more conflicting reports, citing sources from the EU and sources from No. 10 Downing Street, affirming and denying that a deal had been reached. Underscoring the hostility to a deal, the leader of Northern Ireland’s Democratic Unionist Party said Sunday that she would prefer a “no deal” Brexit to a “backstop” transition agreement that would require any borders between Northern Ireland and the UK, arguing that this would amount to the “annexation” of Northern Ireland by the EU, per CNBC.

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The Atlantic Council got going. Social media have become too big a threat to the narrative.

Internet Censorship Just Took An Unprecedented Leap Forward (CJ)

While most indie media was focused on debating the way people talk about Kanye West and the disappearance of Saudi journalist Jamal Khashoggi, an unprecedented escalation in internet censorship took place which threatens everything we all care about. It received frighteningly little attention. After a massive purge of hundreds of politically oriented pages and personal accounts for “inauthentic behavior”, Facebook rightly received a fair amount of criticism for the nebulous and hotly disputed basis for that action. What received relatively little attention was the far more ominous step which was taken next: within hours of being purged from Facebook, multiple anti-establishment alternative media sites had their accounts completely removed from Twitter as well.

As of this writing I am aware of three large alternative media outlets which were expelled from both platforms at almost the same time: Anti-Media, the Free Thought Project, and Police the Police, all of whom had millions of followers on Facebook. Both the Editor-in-Chief of Anti-Media and its Chief Creative Officer were also banned by Twitter, and are being kept from having any new accounts on that site as well.

“I unfortunately always felt the day would come when alternative media would be scrubbed from major social media sites,” Anti-Media’s Chief Creative Officer S.M. Gibson said in a statement to me. “Because of that I prepared by having backup accounts years ago. The fact that those accounts, as well as 3 accounts from individuals associated with Anti-Media were banned without warning and without any reason offered by either platform makes me believe this purge was certainly orchestrated by someone. Who that is I have no idea, but this attack on information was much more concise and methodical in silencing truth than most realize or is being reported.”

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Interesting man.

Professor Exposes Rigged Markets One Academic Paper At A Time (ZH)

Finance professor John Griffin, along with his doctoral student companion, Amin Shams, were the two academics that drew market-moving conclusions about bitcoin last year, while the digital currency was trading around $20,000. After sifting through 2 terabytes of trading data, they alleged that bitcoin was being manipulated by someone using the cryptocurrency Tether to purchase it. Tether remains a relatively little-known crypto, which is pegged to one US dollar. Part of its appeal is that it can “stand in” for dollars when necessary, according to Bloomberg. Griffin and Shams authored a paper in June, with the results of their findings ultimately catalyzing many digital assets to move lower, despite the fact that the CEO of Tether publicly denied that its currency was used to prop up bitcoin.

Griffin works at the University of Texas at Austin, and has become quite an unpopular figure on Wall Street for similar work he has done in the past on ratings companies, the VIX and investment banks. In most of his findings, he claims that these well-known financial instruments and players are, in one way or another, rigged. And the professor seems to enjoy exposing precisely that: rigged, manipulated markets and shady players. “I not only want to understand the world, but make it better,” he told Bloomberg. Griffin’s work has become popular reading within the DOJ and the Commodity Futures Trading Commission, according to Bloomberg.

These regulators – many of them low on resources, time and staff – welcome any additional help they can get (the SEC’s budget has forced it into a hiring freeze and the CFTC budget was cut by Congress in March of this year). John Reed Stark, a former attorney in the SEC’s enforcement division, stated: “It’s incredibly helpful to have an expert of Griffin’s caliber.”

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“..the threat to order might be so great that an unprecedented “emergency” has to be declared, with soldiers in the streets of Washington..”

Hammer Time (Jim Kunstler)

If I were President, I’d declare Oct 12 Greater Fool Day. (Nobody likes Christopher Columbus anymore, that genocidal monster of dead white male privilege.) The futures are zooming as I write, a last roundup for suckers at the OD corral, begging the question: who will show up on Monday. Nobody, I predict. And then what? The great false front of the financial markets resumes falling over into the November election. The rubble from all that buries whatever is left of the automobile business and the housing market. The smoldering aftermath will be described as the start of a long-overdue recession — but it will actually be something a lot worse, with no end in sight.

The Democratic Party might not be nimble enough to capitalize on the sudden disappearance of capital. Their only hope to date has been to capture the vote of every female in America, to otherwise augment their constituency of inflamed and aggrieved victims of unsubstantiated injustices. It’s been fun playing those cards, and the Party might not even know how to play a different game at this point. Democratic politicians may also be among the one-percenters who watch their net worth go up in a vapor in a market collapse, leaving them too numb to act. The last time something like this happened, in the fall of 2008, candidate Barack Obama barely knew what to say about the fall of Lehman Brothers and the ensuing cascade of misery — though unbeknownst to the voters, he was already a hostage of Wall Street.

Complicating matters this time will be the chaos unleashed in politics and governing when the long-running “Russia collusion” melodrama boomerangs into a raft of indictments against the cast of characters in the Intel Community and Department of Justice AND the Democratic National Committee, and perhaps even including the Party’s last standard bearer, HRC, for ginning up the Russia Collusion matter in the first place as an exercise in sedition. The wheels of the law turn slowly, but they’ll turn even while financial markets tumble. And the threat to order might be so great that an unprecedented “emergency” has to be declared, with soldiers in the streets of Washington, as was sadly the case in 1861, the first time the country turned itself upside down.

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Good angle.

Who The Hell Cares What Old People Think About Climate Change? (Ol.)

The loudest and most powerful voices when it comes to the future of the planet — the ones with their hands on the levers of power — have a strong tactical advantage: they will be dead before the shit really hits the fan. This fact curiously goes unspoken, for the most part. Popular arguments tend to be framed around a rosy vision preserving the planet for future generations, which gives our boomer aristocracy the most effective cover story imaginable. They don’t need to care about that, as nice as it sounds. Why would they? It’s all completely hypothetical to them. You may as well be talking about climate patterns in Narnia. Make no mistake: older generations living in the developed world are part of history’s most under-appreciated death cult.

This isn’t abstract psychoanalysis. There is a brutal calculus going on in the minds of everyone from your skeptic uncle to the bankrollers of squillion dollar think tanks whenever they think or talk about climate change. They know that they will never have to really answer for their opinions on this matter, because they’ll be six feet under (and loving it!) when the world’s arable land is rendered infertile and its coastal cities flooded by rising oceans. In some dark and venal corner of their minds, they’re thinking about that fact all the damn time. Despite the frightening predictions of the new IPCC report, they’ve still got plenty of wiggle room to keep denying until they’re dead – which will be sooner rather than later. With any luck they’ll even avoid being held accountable in any concrete way, which for the conservative commentariat is an even worse fate than the Mad Max hellworld towards which we are hurtling.

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One scary dude.

What’s Another Way to Say ‘We’re F-cked’? (Goodell)

[..] a scientist named Richard Alley in a Skype discussion with students at Bard College, as well as with Eban Goodstein, director of the Graduate Programs in Sustainability at Bard. It would be just another nerdy Skype chat except Alley is talking frankly about something that few scientists have the courage to say in public: As bad as you think climate change might be in the coming decades, reality could be far worse. Within the lifetime of the students he’s talking with, Alley says, there’s some risk — small but not as small as you might hope — that the seas could rise as much as 15-to-20 feet.

[..] Richard Alley is not a fringe character in the world of climate change. In fact, he is widely viewed as one of the greatest climate scientists of our time. If there is anyone who understands the full complexity of the risks we face from climate change, it’s Alley. And far from being alarmist, Alley is known for his careful, rigorous science. He has spent most of his adult life deconstructing past Earth climates from the information in ice cores and rocks and ocean sediments. And what he has learned about the past, he has used to better understand the future. For a scientist of Alley’s stature to say that he can’t rule out 15 or 20 feet of sea-level rise in the coming decades is mind-blowing.

And it is one of the clearest statements I’ve ever heard of just how much trouble we are in on our rapidly warming planet (and I’ve heard a lot — I wrote a book about sea-level rise). To judge how radical this is, compare Alley’s numbers to the latest report from the Intergovernmental Panel on Climate Change, which was released on Monday. That report basically argued that if we don’t get to zero carbon emissions by 2050, we have very little chance of avoiding 1.5 Celsius of warming, the threshold that would allow us to maintain a stable climate. The report projected that with 2 Celsius of warming, which is the target of the Paris Climate Agreement, the range of sea level rise we might see by the end of the century is between about one and three feet.

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Sure. But start giving back what was. Problem is, so much of it WAS looted that the museum would become a pretty empty place.

‘Not Everything Was Looted’: British Museum To Fight Critics (G.)

The British Museum is launching an initiative intended to counter the perception that its collections derive only from looted treasures. The monthly Collected Histories talks, which begin on Friday, will provide information on how certain artefacts entered the collection, with the museum saying it will offer a more nuanced take on these stories than is available elsewhere. The museum has long faced criticism for displaying – and refusing to return – looted treasures, including the Parthenon Marbles, Rosetta Stone, and the Gweagal shield.

Earlier this year, the art historian Alice Procter’s Uncomfortable Art Tours around London institutions, including the British Museum, made headlines for their attempts to expose the role of colonialism, with those on the tour given “Display It Like You Stole It” badges. Dr Sushma Jansari, the curator of the Asian ethnographic and South Asia collections at the British Museum, said she had devised Collected Histories in response to Procter’s tours. “There are a lot of partial histories and they tend to focus on the colonial aspect of the collecting so you have a bunch of people who tend to be quite angry and upset,” she said. “We’re trying to reset the balance a little bit. A lot of our collections are not from a colonial context; not everything here was acquired by Europeans by looting.”

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