Dec 232020
 


Edward Hopper Automat 1927

 

Trump Kicks COVID Bill Back To Congress; Demands $2,000 Stimulus (ZH)
Force The Vote On Direct Aid (DP)
Biden’s Austerity Zealotry Helped Cut The Stimulus Bill In Half (DP)
COVID19 Catch-22: Regime-Change Policies Come With US Pandemic Relief (GZ)
White House Memo Details How ‘Pence Card’ Can Save Trump Presidency (NF)
Growing Number Of GOP Lawmakers Back Electoral College Challenge (Hill)
Trump Pardons George Papadopoulos (DC)
WHO: New UK COVID19 Strain No Deadlier, Only Slightly More Infectious (RT)
America Is Now Ruled By People Older Than Soviet Union ‘Gerontocracy’ (RT)
Stalemate (Paul Edwards)
China Has Infiltrated America (Rickards)
Financial Warfare Is Real (Rickards)
UN Expert Melzer Asks US President Donald Trump To Pardon Julian Assange (UN)

 

 

Trump kicks the relief bill back to Congress and says he wants $2,000 checks. Everyone scrambles to react. Bernie campaigner David Sirota writes: “The question now: Will Pelosi, Schumer and Biden do everything in their power to call Trump’s bluff..?”. But what bluff? Saying the same thing as the squad is a bluff? And they can “call the bluff” only by agreeing with the man they’ve demonized for 4 years?

Trump has been talking about bigger checks for a long time. Was this a bluff that whole time? Amy Klobuchar tries her own private angle, and calls raising the stimulus to $2,000 per person “an attack on every American”. What? Is that also a bluff? At the end of the day, Trump and the Squad both want the same thing. All the rest are stuck in the middle.

And AOC tries to save the day, and her face, by saying the Squad had the proposals for $2,000 checks already written up.

Okay, explain where they went. How hard did you fight Pelosi etc. in order to get the exact same thing Trump wants?

Who’s calling whose bluff around here?

 

 

“Send me a suitable bill or else the next administration will have to deliver a COVID relief package and maybe that administration will be me and we will get it done.”

Trump Kicks COVID Bill Back To Congress; Demands $2,000 Stimulus (ZH)

President Trump appeared to threaten to veto the COVID-19 stimulus package that Congress passed almost 24 hours earlier, telling lawmakers to boost checks for Americans to $2,000 as well as “get rid of wasteful and unnecessary items” in the spending bill. Trump said “throughout the summer, Democrats cruelly blocked COVID relief legislation in an effort to advance their extreme left wing agenda and influence the election…” “it’s taken forever” to get a package and the bill passed “is much different than anticipated.” “It really is a disgrace,” he added. Then reeled off a list of disgusting ‘pork’ that has been piled into this record-breaking 5,593 page bill.


As Axios notes, many of the items Trump listed, such as foreign aid, which were not related to COVID-19 are not part of the coronavirus relief package. These form part of the government funding bill, which was passed alongside the coronavirus relief package. Then he took a shot at Biden and the election. “Send me a suitable bill or else the next administration will have to deliver a COVID relief package and maybe that administration will be me and we will get it done.”

Trump relief speech

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“Luckily for Biden, Nancy Pelosi and Chuck Schumer — and for millions of people who need help — Trump is giving them one last chance to do the right thing..”

Force The Vote On Direct Aid (DP)

Donald Trump on Tuesday threatened to veto emergency stimulus legislation unless lawmakers increased direct payments to millions of families facing the prospect of eviction, loss of health insurance, unemployment and starvation. Lawmakers had settled on meager one-time $600 checks but the president demanded $2,000 payments — a proposal that was championed months ago by congressional progressives but that was ignored by both parties’ legislative leaders. The declaration from the GOP president follows his other recent statements in support of bigger checks. The entire situation shows that Joe Biden and Democratic congressional leaders either could have driven a much tougher bargain in their negotiations over new COVID-19 relief legislation with Republican Senate Majority Leader Mitch McConnell — or they actually deliberately prioritized austerity and didn’t want a bigger spending package in the first place.

Luckily for Biden, Nancy Pelosi and Chuck Schumer — and for millions of people who need help — Trump is giving them one last chance to do the right thing and back a bolder version of the $1,200 direct payment proposal that Sens. Bernie Sanders, I-Vt., and Josh Hawley, R-Mo., have been pushing from the beginning of this most recent round of negotiations. In fact, seven months ago Sanders joined Sens. Kamala Harris, Ed Markey and Kirsten Gillibrand in introducing a bill to provide monthly $2,000 checks to individuals until the pandemic is over. (That’s not surprising, given that Sanders and the Congressional Progressive Caucus he led were the original authors of the first stimulus check of the modern era, way back in 2001.) The question now: Will Pelosi, Schumer and Biden do everything in their power to call Trump’s bluff and force a vote to increase the $600 checks to $2,000?

Pelosi clearly feels the heat — she is suddenly pretending she’s always been ready to take Trump up on his offer to support $2,000 survival checks, even though prior to about an hour ago, she had never tried to triangulate Trump against McConnell on the issue. Earlier this month, she supported a deal that did not include checks at all, and just yesterday she insisted that $600 checks were “significant.” Indeed, the $2,000 is a new ask for Democratic leaders — progressive lawmakers had been pushing it for months, but Pelosi’s much-touted HEROES Act only asked for $1,200 one-time, means-tested checks. Regardless, the Democratic House Speaker is now finally saying she wants a vote to amend the stimulus bill to increase the small $600 checks to $2,000 — and such an amendment has already been written by Democratic Reps. Alexandria Ocasio-Cortez and Rashida Tlaib.

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“That last line of Biden’s statement is arguably the most disturbing foreshadow of all: He is depicting the process — which starved America for months and now skimps on benefits — as a terrific “model” for the future.”

Biden’s Austerity Zealotry Helped Cut The Stimulus Bill In Half (DP)

If there is any consistent throughline in Joe Biden’s long career, it is his commitment to the ideology of austerity. He has obsessively pushed for Social Security cuts for decades, and he is stocking his administration with deficit hawks — including today’s announcement that notorious Social Security cutterBruce Reed will be White House deputy chief of staff. Biden has even threatened to veto Medicare for All legislation on the grounds that it costs too much (even though Congress says it would actually save a lot of money). Now, in the whittling down of the stimulus legislation, we see the first concrete example of how Biden’s ideology can change policy in the here and now — and in deeply destructive ways.

As pain and suffering is crescendoing across the country, Biden refrained from aggressively pushing the bipartisan initiative for $1,200 survival checks. Indeed, at a time when there was a legitimate chance to flip some Republicans — including Donald Trump! — against McConnell and push for a more robust stimulus, he demurred. However, the New York Times reminds us today that Biden was “not an idle bystander in the negotiations.” On the contrary, the paper of record tells us that the president-elect played a decisive role in making sure the legislation was cut in half. Here is the key excerpt:

“With Republican and Democratic leaders in the House and Senate far apart on how much they were willing to accept in new pandemic spending, Mr. Biden on Dec. 2 threw his support behind the $900 billion plan being pushed by the centrist group. The total was less than half of the $2 trillion that Speaker Nancy Pelosi and Senator Chuck Schumer, Democrat of New York, had been insisting on. Mr. Biden’s move was not without risks. If it had failed to affect the discussions, the president-elect risked looking powerless to move Congress before he had taken the oath of office. But members of both parties said his intervention was constructive and gave Democrats confidence to pull back on their demands.”

Read that again, just so it sinks in: Biden endorsing an initiative to slash the stimulus bill in half “gave Democrats confidence to pull back on their demands” for a much more robust rescue package at a time when America faces rising food insecurity and poverty. His enthusiastic lauding of the final bill underscores the role he played. “In November, the American people spoke clearly that now is a time for action and compromise,” Biden said in a statement. “I am heartened to see members of Congress heed that message, reach across the aisle, and work together. This is a model for the challenging work ahead for our nation.” That last line of Biden’s statement is arguably the most disturbing foreshadow of all: He is depicting the process — which starved America for months and now skimps on benefits — as a terrific “model” for the future.

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But it’s 2 different bills, says everyone. Yeah, big difference that makes.

COVID19 Catch-22: Regime-Change Policies Come With US Pandemic Relief (GZ)

The longest piece of legislation in United States history, containing both a coronavirus relief package and the annual omnibus spending package, quickly passed through Congress on December 22, with little opposition. While technically separate bills, the omnibus and stimulus were debated and passed together, at the same time.The massive piece of legislation — a staggering 5,593 pages in length — lays bare the priorities of the US government, prioritizing regime change in foreign nations and the imperatives of empire over the basic needs of Americans. In just a few hours, it passed through the House of Representatives by 359-53, and through the Senate by 92-6.

While the US public was forced to grovel for months for a $600 direct payment, the same piece of legislation pumps billions of dollars into “democracy programs” — US government code for regime-change operations via civil society NGOs — and foreign military assistance. The measly $600 survival checks pale in comparison to the massive foreign spending on regime change and titanic allocations to prop up US-friendly authoritarian militaries. On so-called “Democracy Programs” alone, the legislation appropriates $2.417 billion, and $6.175 billion on the “Foreign Military Financing Program.” Another $112.9 million is appropriated for “International Military Education and Training.”

$6 billion more is allocated toward the domestic procurement of US Air Force missiles and US Navy weapons of war. This is in addition to the $740 billion defense bill passed earlier in December. By contrast, the stimulus package comes at a value of $900 billion, with the largest portion devoted to business bailouts. The Federal News Network reports that the $1.4 trillion omnibus includes $671.5 billion allocated to “base defense spending,” with another $77 billion going to “overseas contingency operations.”

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“Pence has the sole power determine whether to reject impermissible states of electors.”

White House Memo Details How ‘Pence Card’ Can Save Trump Presidency (NF)

Sources in the Trump administration confirmed to National File that President Donald Trump’s most vocal advocates within the White House have determined that both U.S. Code and the Constitution contain language that requires Vice President Mike Pence to reject unlawful Electoral College certificates, but Pence must act by no later than Wednesday, December 23. The drafters of this White House memo believe that the federal check to the states’ elections resides with Vice President Mike Pence in his role as President of the Senate. Additionally, Pence has the sole power determine whether to reject impermissible states of electors. However, Pence is legally required to do this on the fourth Wednesday in December, which this year falls on December 23.

National File’s sources in the White House indicated that the memo was requested by those in the President’s circle who are most keen to see the 2020 election, and the ensuing fallout, administered in as transparent of a manner as possible. They also indicate that the push to find a path to verify the 2020 election’s integrity is not coming solely from the White House, but also comes from across numerous agencies in the administration. FROM THE MEMO: Article II, Section 1 of the U.S. Constitution requires that “Each State shall appoint, in such Manner as the Legislature thereof may direct, a Number of Electors.” Therefore, the papers (or “slates”) the states attempted to submit to the President of the Senate and Archivist of the United States are not legal, permissible certificates of votes and lists by Electors as recited in Title 3, U.S.C., sections 9 and 11. Arizona, Georgia, Michigan, Nevada, Pennsylvania, and Wisconsin violated the U.S. Constitution’s Art. 2, S.1, Cl.2 and 14th Amendment, Section 1, Equal Protection Clause in administering their elections, therefore rendering their slates impermissible.

On Dec. 14, the States consummated a fraudulent and Constitutionally deficient certification of their electors as required by 3 USC 7. State and federal authorities have discovered Overwhelming evidence of election fraud and irregularities since Nov. 4, likely rising to the level of criminal election fraud and public corruption. Civil courts dismissed these claims procedurally, rather than on substance.

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And the Hill doesn’t like it.

Growing Number Of GOP Lawmakers Back Electoral College Challenge (Hill)

A growing number of House Republicans say they will challenge the results of the 2020 presidential election when Congress meets to certify the Electoral College results on Jan. 6. The latest Republican to say he will do so is Rep.-elect Madison Cawthorn (N.C.), who will be a part of the House when it convenes in early January. He implored other Republicans to also challenge the results in a video message. “I have a message for all other Republicans across the country,” Cawthorn said. “If you are not on the record calling for fair, free and just elections now and in the future, I will come to your district and I will fund a primary opponent against you.” Not doing this to help my career in Washington, in fact this will most likely harm it. But no one should go to Washington as a career. Go there to serve the people. And on behalf of the people I am contesting this election based on constitutional violations by key states. — Madison Cawthorn (@CawthornforNC) December 21, 2020


There is no evidence the results of the last election showing President-elect Joe Biden defeating President Trump by more than 70 electoral votes and more than 7 million votes overall was unfair, and efforts by Trump and his allies to reverse the outcome have gone nowhere in the courts. The effort in the House is also doomed to failure, as it will not be possible for supporters to secure a majority vote given Democratic control of the lower chamber, and the fact that a number of Republicans also object to the effort first launched by Rep. Mo Brooks (R-Ala.). But Trump has encouraged the effort, and a number of House Republicans, likely with an eye on getting attention from the most powerful Republican in the country, have said they will join Brooks.

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“Today’s pardon helps correct the wrong that Mueller’s team inflicted on so many people.”

Trump Pardons George Papadopoulos (DC)

President Donald Trump granted a full pardon on Tuesday to George Papadopoulos, the former campaign aide at the center of the FBI’s investigation into possible collusion with Russia to influence the 2016 election. “Mr. Papadopoulos was charged with a process-related crime, one count of making false statements, in connection with Special Counsel Robert Mueller’s investigation into possible Russian interference in the 2016 presidential election,” the White House said in a statement about the pardon. “Today’s pardon helps correct the wrong that Mueller’s team inflicted on so many people.” Trump also pardoned Alex van der Zwaan, a Dutch national convicted in the Mueller probe. Last month, Trump pardoned Michael Flynn, his former national security adviser, who pleaded guilty to false statements charges on Dec. 1, 2017.

Papadopoulos was the first Trump associate to plead guilty in the Mueller probe. He served 12 days in prison on charges that he made false statements to the FBI in January 2017 regarding his interactions with a Maltese professor who claimed to have learned that the Russian government had Hillary Clinton’s emails. The FBI opened Crossfire Hurricane, its counterintelligence investigation of the Trump campaign, on July 31, 2016, based on an Australian diplomat’s tip regarding a meeting he had on May 10, 2016 with Papadopoulos. Alexander Downer, the diplomat, claimed that Papadopoulos told him that Russia might help the Trump campaign by releasing material close to the election.

Investigators initially thought that Papadopoulos took part in a collusion scheme with Russia or knew of Trump associates who might have been. But the FBI probe, and the Mueller investigation that followed, ultimately turned up no evidence of a conspiracy between Trump associates and the Russian government. Papadopoulos has denied telling anyone on the Trump campaign about his conversations with the Maltese diplomat, Joseph Mifsud. “Notably, Mueller stated in his report that he found no evidence of collusion in connection with Russia’s attempts to interfere in the election. Nonetheless, the Special Counsel’s team still charged Mr. Papadopoulos with this process-related crime,” the White House said in its pardon statement.

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The borders already re-opened.

WHO: New UK COVID19 Strain No Deadlier, Only Slightly More Infectious (RT)

The World Health Organization has come forward to calm things down amid the anxiety over a new potentially ‘highly infectious’ Covid-19 strain found in the UK, saying it is not that different from other coronavirus strains. “There is zero evidence that the new coronavirus variant increases severity of the disease,” the WHO’s Health Emergencies Program Chief Mike Ryan told at a press conference on Monday, citing data received from British scientists. The risks faced by the people that catch this particular strain of the virus are pretty much the same as odds faced by other people suffering from Covid-19. According to the WHO, it is neither more aggressive, nor any deadlier than the other strains.= It does seem to be spreading somewhat easier, the health watchdog admitted. Still, its contagiousness appears to be nothing out of the ordinary and it is still much less infectious than diseases such as mumps.


The new strain would also hardly affect the efficacy of drugs and vaccines developed against Covid-19, the WHO Chief Scientist Soumya Swaminathan said. “So far, even though we have seen a number of changes, a number of mutations, none has made a significant impact on … the susceptibility of the virus to any of the currently used therapeutics, drugs or the vaccines under development,” she said. WHO officials also described a flurry of travel bans to and from the UK imposed by some two dozen of nations across the world as a move taken out of abundance of caution. “We have to find a balance. It’s very important to have transparency, it’s very important to tell the public the way it is, but it’s also important to get across that this is a normal part of virus evolution,” Ryan said, while still calling this decision “prudent.”

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”.. prompting then-US president Ronald Reagan to say “How am I supposed to get anyplace with the Russians if they keep dying on me?” Yet Reagan was 74 at the time, older than all three.”

America Is Now Ruled By People Older Than Soviet Union ‘Gerontocracy’ (RT)

Joe Biden, set to be the oldest-ever US president, is actually on the younger side of people currently running the American political establishment, who show no sign of wanting to ever step aside for another generation. It is often overlooked that Donald Trump currently holds the distinction of being the oldest-ever US president, being 70 at the time of his inauguration. Biden will take that trophy as well if he’s inaugurated in January 2021, having turned 78 last month. Even so, he is actually younger than the current leaders of the House and the Senate! Though all major power brokers in Washington are older than the “gerontocracy” that ruled the Soviet Union in the 1970s and the 1980s, you won’t hear the US mainstream media make the comparison, as it wouldn’t fit their Narrative.

Sure, there has been some carefully calibrated talk about the “cognitive decline” of Senator Dianne Feinstein, who is 87. But Feinstein is from an overwhelmingly Democrat state and she can be easily replaced at the same time as Kamala Harris, Biden’s running mate who still hasn’t resigned her Senate seat. House Speaker Nancy Pelosi (D-California) is 80, and has raised eyebrows herself with the whole “Good Morning. Sunday Morning” glitch-in-the-Matrix behavior during a TV appearance in September. Way back in 2018, Pelosi insisted that any talk about wanting someone younger in the leadership position was “sexist,” and went on to ruthlessly crush any opposition to her getting the gavel – and the power that went with it – inside the party. In the same interview, Pelosi blanked out on the name of Senate Majority Leader Mitch McConnell (R-Kentucky), calling him “whatshisname.”

Born several months ahead of Biden in 1942, McConnell is 78 himself. He had a bout with polio when very young, and though successfully treated, he’s had difficulty climbing stairs all his life. While he hasn’t shown any signs of cognitive decline, his political choices as of late have certainly caused some Republicans to wonder if he’s truly the legislative genius his supporters make him out to be. [..] the young activist House members who came in with 2018’s “Blue Wave,” such as Alexandria Ocasio-Cortez (D-New York), are being kept in check by the old guard. Just last week, AOC was denied a spot on the House Energy and Commerce Committee, thwarting her plans to push for her “Green New Deal” proposal. Compare this state of US politics with the notorious “gerontocracy” of the Soviet Union. Three aging Soviet leaders died in quick succession between 1982 and 1985, prompting then-US president Ronald Reagan to say “How am I supposed to get anyplace with the Russians if they keep dying on me?” Yet Reagan was 74 at the time, older than all three.

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“On top of that, there is now—I won’t call it news—official yammer that those pesky Russkies are at it again…”

Stalemate (Paul Edwards)

In chess, stalemate describes the endgame situation in which one party has no possible legal moves. It is the point at which we are arrived in our Presidential fiasco. There has been great angst and gnashing of teeth over it, and ebullient, if tentative, rejoicing on the part of giddy enthusiasts for whom Trump’s electoral defeat represents the Jubilee, the Dawn of Glory, and re-establishment of righteousness on earth. This view, deluded and infantile as it is, is nevertheless sincere and widely held. Stalemate, though, is not victory, in chess or otherwise. In a stalemate the game ends in a draw. That said, it seems likely Trump will depart—in spite of the hysteria peddled by so many in media and cyber-flackery—without anything faintly resembling the Reichstag Fire, or even a Proud Boys version of the shootout at the OK Corral. He’ll go with a whimper, not a bang.

So the crisis ends in victory? Or has it indeed been a sort of draw? We’ve been assured from authoritative quarters, in the most decisive terms, that, in his mulish, petulant refusal to take no for an answer to his grandiose ambitions, Trump has done irreparable damage to the Great Institution of our Electoral Democracy; that his dogged denial of his loss, and utter rejection of the protocols of cordial transition have sorely undermined, and perhaps even fatally shaken, our collective faith in the purity and justice of our Constitutional process and its benign functioning. On top of that, there is now—I won’t call it news—official yammer that those pesky Russkies are at it again. Yes, by golly, they’ve diabolically infiltrated our Official Secrets Crypt, no doubt goaded into it by that fiend, Putin, who, according to what we’ve been schooled for four years to believe, ought to have been spending all his energies backing Trump, but somehow overlooked that.

It appears that after doing so much to elect him in ‘16, they didn’t bother this time and let him lose. Just no fathoming their deviltry. Anyhow, our noble protectors and defenders, those fab Security Services—FBI, NSA, CIA and the other sixteen or twenty-three sister spook units who’ve done so much to keep us from harm—all have their knickers in a twist, one hand clutching their pearls and the other making a bold fist at the Kremlin, over Vlad & Co. attacking the dead meat of our sanctified secrets catacombs. What a dogpile! What a gang-bang! Trump and the Russians, allied again, bringing all their satanic powers to bear on the frail, vulnerable vessel of our fate, the very motor and mainspring of Columbia, the Gem of the Ocean: our hallowed electoral system. Come on, somebody has to call bullshit on this nonsense.

Read more …

Two pieces from Jim Rickards at Daily Reckoning.

China Has Infiltrated America (Rickards)

Spying is as old as civilization. As long as there have been leaders with secrets and armies on the march, opponents have wanted to know what they’re thinking and where they’re going. Hence the need for spies. And it comes as no surprise that the Chinese are as good as anyone when it comes to spying and that their main target is the United States. What may come as a surprise is the scope of their success and the enormous number of operatives, influencers, sleepers and other varieties of spies who have already infiltrated critical U.S. institutions. Of course, a lot of spying today involves surveillance of phone calls, digital message traffic, online financial transactions, facial recognition software, satellite surveillance and other electronic tradecraft.

But the old fashioned methods of the human spy penetrating organizations, gaining trust and stealing secrets have never gone away. In fact, that type of human intelligence (HUMINT) seems to be having a renaissance. Members of the Chinese Communist Party who pledge to “fight for communism throughout my life … and… be loyal to the party” are hard at work inside companies like Boeing, Pfizer and Qualcomm, political strongholds like the U.S. State Department, and on Capitol Hill. Other spies operate clandestinely, including a woman named Fang Fang, a young attractive Chinese spy who worked her way into an intimate relationship with Congressman Eric Swalwell (D-CA), a member of the House Intelligence Committee who routinely receives classified briefings.

This is a classic intelligence technique known as a Honey Trap. Swalwell fell for it. Somehow Fang got a heads up and fled back to China before she could be turned into a double-agent or simply arrested by the FBI. No word yet on who gave her the heads-up, but Swalwell is suspected. The Chinese intelligence services have also penetrated academia using so-called Confucius Institutes (cultural exchange facilities that are really nests of spies) and lavish research grants. Too often, Americans are ensnared in Chinese spying efforts either because they are naive or just greedy for the money the Chinese spread around. U.S. targets simply turn a blind eye to the damage to America. Until things change, America’s technological and strategic edge will be blunted by Chinese theft of secrets and compromise of elite decision-makers.

Let’s hope this changes, but don’t hold your breath. Will the U.S. intelligence community get a grip on the Chinese threat? There’s good news and bad news. The good news is that the U.S. The Intelligence Community, particularly the CIA, seem to have woken up to the fact that the world has changed. The bad news is that it still seems to be riddled with the same hidebound bureaucrats, the same ‘go along to get along’ guys I saw during my years at the Agency. A big problem is the “culture of secrecy.” Forty years ago, secrets were valuable, and open-source information was not particularly useful beyond just keeping up with the news. Information used to be a scarce resource. But that world has changed. Today, information flow is like a fire hose; there’s almost more than you can process. The scarce resource today is not information; it’s analytic ability.

Read more …

War simulations. Better than board games.

Financial Warfare Is Real (Rickards)

In my 2011 book, Currency Wars, I gave a detailed description of the first-ever financial war game sponsored by the Department of Defense. This financial war game took place in 2009 at the top-secret Applied Physics Laboratory located about twenty miles north of Washington, D.C., in the Maryland countryside. Unlike typical war games, the “rules of engagement” for this financial exercise did not permit the use of any kinetic weapons such as bombs, missiles or drones. The only weapons allowed were financial instruments including stocks, bonds, currencies, commodities and derivatives. The game was played out over two days in the main War Room of the laboratory using six teams divided into the U.S., China, Russia, Europe, East Asia, and Banks & Hedge Funds.

The contestants included about 40 players on the six teams and another 60 participants including: uniformed military, civilian defense officials, observers from the Treasury, Federal Reserve, CIA and other government agencies, think tanks, universities, and financial industry professionals. In that original financial war game, a scenario involving Russia, China, gold and the destruction of the U.S. dollar was played out against a backdrop of geopolitical events, including the collapse of North Korea and a threatened Chinese invasion of Taiwan. In May 2015, the Pentagon sponsored a new financial warfare session, which I was also invited to attend. This time the financial war took place inside a secure meeting facility at the Pentagon itself.

This new financial war game exercise was smaller and more focused than the one in 2009. We had about 20 participants. Our group included representatives from the diplomatic corps, military, think tanks, universities, CIA and the National Security Council. I was one of three individuals from the investment management community. Our scenario this time was not global but was instead limited to a confrontation between China and the U.S. involving disputed jurisdiction in the South China Sea. Six nations have claims in the South China Sea – China, Taiwan, Philippines, Malaysia, Vietnam and Brunei. These claims overlap to a great extent, setting the stage for disputes and possible war.

The South China Sea is rich in oil, natural gas reserves, fishing rights and other natural resources. The surrounding nations dispute with certain island groups – the Spratly Islands and the Paracel Islands – and are also using reefs, sunken vessels and landfill to create artificial islands, which they are populating with bases and military garrisons. The U.S. has treaty obligations to the Philippines and Taiwan, which could result in the U.S. becoming engaged militarily in the event of a dispute with China. This volatile mix of disputed claims, natural resources and complex treaty networks has the ingredients needed to escalate into a Third World War. All it would take to start a war is some spark, such as a collision at sea or an attack based on mistaken identity or misunderstood intentions. The occurrence of such a war is likely inevitable.

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Stating the obvious.

UN Expert Melzer Asks US President Donald Trump To Pardon Julian Assange (UN)

“Mr. President, Today, I respectfully request that you pardon Mr. Julian Assange. Mr. Assange has been arbitrarily deprived of his liberty for the past ten years. This is a high price to pay for the courage to publish true information about government misconduct throughout the world. I visited Mr. Assange in Belmarsh High Security Prison in London, with two independent medical doctors, and I can attest to the fact that his health has seriously deteriorated, to the point where his life is now in danger. Critically, Mr. Assange suffers from a documented respiratory condition which renders him extremely vulnerable to the Covid-19 pandemic that has recently broken out in the prison where he is being held.

I ask you to pardon Mr. Assange, because he is not, and has never been, an enemy of the American people. His organization, WikiLeaks, fights secrecy and corruption throughout the world and, therefore, acts in the public interest both of the American people and of humanity as a whole. I ask because Mr. Assange has never published false information. The cause for any reputational harm that may have resulted from his publications is not to be found in any misconduct on his part, but in the very misconduct which he exposed. I ask because Mr. Assange has not hacked or stolen any of the information he published. He has obtained it from authentic documents and sources in the same way as any other serious and independent investigative journalists conduct their work. While we may personally agree or disagree with their publications, they clearly cannot be regarded as crimes.

I ask because prosecuting Mr. Assange for publishing true information about serious official misconduct, whether in America or elsewhere, would amount to “shooting the messenger” rather than correcting the problem he exposed. This would be incompatible with the core values of justice, rule of law and press freedom, as reflected in the American Constitution and international human rights instruments ratified by the United States. I ask because you have vowed, Mr. President, to pursue an agenda of fighting government corruption and misconduct; and because allowing the prosecution of Mr. Assange to continue would mean that, under your legacy, telling the truth about such corruption and misconduct has become a crime.

In pardoning Mr Assange, Mr. President, you would send a clear message of justice, truth and humanity to the American people and to the world. You would rehabilitate a courageous man who has suffered injustice, persecution and humiliation for more than a decade, simply for telling the truth.

Read more …

 

 

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Alexandros Maragos Conjunction of Jupiter and Saturn over #Athens

 

 

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Dec 012017
 


Edward S. Curtis Mosa Mohave girl c. 1903

 

The Mean Reverting History Of Profit Growth (Roberts)
US Household Debt Is Rising 60% Faster Than Wages (ZH)
We Give Up! Government Spending And Deficits Soar Everywhere (Rubino)
Lemmings In Full Stampede Toward The Fiscal Cliff (Stockman)
Brexit Risks Leaving Banks on the Hook for Impossible Contracts (BBG)
I’m Glad Morgan Stanley Has Warned Us About Jeremy Corbyn (Ind.)
US Senate Suspends Tax Bill Votes to Friday Morning (BBG)
Australian Banks Face Public Inquiry Amid String of Scandals
Gold Trader Implicates Erdogan In US Sanctions Breaking Case (BBC)
From The Caucasus To The Balkans, China’s Silk Roads Are Rising (Escobar)
Paris – The Financial Capital Of West And Central Africa (Gefira)
Chinese Satellite Closes In On Dark Matter Mystery (AFP)

 

 

Another great set of graphs from Lance Roberts, who just keep churning them out. I picked these two to show how dependent economies have become on suppressing wages. Problem is, that threatens economies. You need money rolling at the ground level to keep your economy going.

The Mean Reverting History Of Profit Growth (Roberts)

Since 2000, each dollar of gross sales has been increased to more than $1 in operating and reported profits through financial engineering and cost suppression. The next chart shows that the surge in corporate profitability in recent years is a result of a consistent reduction of both employment and wage growth. This has been achieved by increases in productivity, technology, and off-shoring of labor. However, it is important to note that benefits from such actions are finite. (Note the acceleration in profits starting with the Reagan Tax Cuts in the 1989’s. There is no evidence that cutting taxes for corporations leads to higher wages for employees.)

Given the economic landscape of recent years, large offsetting sectoral deficits and surpluses are not surprising, but they should not be taken as evidence that the long-term profitability of the corporate sector has permanently shifted higher. Stocks are not a claim to a few years of cash flows, but decades and decades of them. By pricing stocks as if current profits are representative of the indefinite future, investors have ensured themselves a rude awakening over time. Equity valuations are decidedly a long-term proposition, and from present levels, the implied long-term returns are quite dim.

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And then you get this…

US Household Debt Is Rising 60% Faster Than Wages (ZH)

The good news: total mortgage debt has decreased since 2008, to $8.743 trillion from $9.29 trillion, but as of the third quarter of 2017, still accounts for 67.5% of overall consumer debt. The bad news: since 2008, the growth in total debt has been attributable to the auto loan and student loan sectors. Auto loan debt has increased by 50% since 2008, to slightly over $1.2 trillion from approximately $800 billion. The most dramatic growth rate, as Zero Hedge readers know well, has been in student loan debt which has grown by 122% since 2008, to $1.357 trillion from $611 billion. But a bigger concern flagged by DBRS is that the growth in consumer debt is raising concerns when viewed in the context of the existing wage stagnation hampering the current economic environment.

The rating agency cites a paper published in October 2017 by the Harvard Business Review which stated that the inflation-adjusted hourly wage has grown by only 0.2% per year since the mid-1970s and labor’s share of income has decreased to its current level of 57% from 65%. Meanwhile, in the second quarter of 2017, wages were only 5.7% higher than they were a decade earlier. In comparison, the Federal Reserve Bank of New York/Equifax data shows that consumer debt growth over the same period was 9.3%. In other words, the purchasing power of US households has been largely a function of rapidly rising debt, which over the past decade has risen 60% faster than wages. There is another concern: while overall delinquency rates have stabilized in recent years, the one stubborn outlier remains student debt, where 90+ day delinquencies have risen to more than 10%.

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“Obviously debts of this magnitude can’t and therefore won’t be repaid. Which means the coming decade will be defined by how — and how quickly — we end up defaulting.”

We Give Up! Government Spending And Deficits Soar Everywhere (Rubino)

A recurring pattern of the past few decades involves governments promising to limit their borrowing, only to discover that hardly anyone cares. So target dates slip, bonds are issued, and the debts keep rising. This time around the timing is especially notable, since eight years of global growth ought to be producing tax revenues sufficient to at least moderate the tide of red ink. But apparently not. In Japan, for instance, government debt is now 250% of GDP, a figure which economists from, say, the 1990s, would have thought impossible. Over the past decade the country’s leaders have proposed a series of plans for balancing the budget, and actually did manage to shrink debt/GDP slightly in 2016. But now they seem to have given up, and are looking for excuses to keep spending.

[..] To put the above in visual terms, here’s an infographic from Howmuch.com that shows per-capita government debt for the world’s major countries. Note that a Japanese family of five’s share of its government’s debt is close to $450,000 while in the US a similar family owes $300,000. That’s in addition to their mortgages, car loans, credit cards, etc. Obviously debts of this magnitude can’t and therefore won’t be repaid. Which means the coming decade will be defined by how — and how quickly — we end up defaulting.

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More of that same story.

Lemmings In Full Stampede Toward The Fiscal Cliff (Stockman)

The lemmings are now in full stampede toward the cliffs. You can literally hear the cold waters churning, foaming and crashing on the boulders far below. From bitcoin to Amazon, the financials, the Russell 2000 and most everything else in between, the casinos are digesting no information except the price action and are relentlessly rising on nothing more than pure momentum. The mania has gone full retard. Certainly earnings have nothing to do with it. As of this morning, the Russell 2000, for instance, was trading at 112X reported LTM earnings. Likewise, Q3 reporting is all over except for the shouting and reported LTM earnings for the S&P 500 came in $107 per share. That’s of signal importance because fully 36 months ago, S&P earnings for the September 2014 LTM period posted at $106 per share.

That’s right. Three years and $1 of gain. They talking heads blather about “strong earnings” only because they think we were born yesterday. What happened in-between, of course, was the proverbial pig passing through the python. First, the global oil, commodities and industrial deflation after July 2014 took earnings to a low of $86.44 per share in the March 2016 LTM period. After that came the opposite—the massive 2016-2017 Xi Coronation Stimulus in China. The new Red Emperor and his minions pumped out an incredible $6 trillion wave of new credit, thereby artificially stimulating a global rebound and a profits recovery back to where it started three years ago.

The difference of course is that $106 of earnings back then were priced at an already heady (by historical standards) 18.6X, whereas $107 of earnings today are being priced at a truly lunatic 24.6X. After all, nothing says earnings bust ahead better than an aging business cycle, a cooling Red Ponzi, an epochal shift toward central bank QT (quantitative tightening) and a massive Washington Fiscal Cliff. Yet every one of those headwinds are self-evident and have made their presence known with a loud clang in the last few days.

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For good measure, let’s throw in some Catch 22.

Brexit Risks Leaving Banks on the Hook for Impossible Contracts (BBG)

As far as Brexit headaches go, John McFarlane, who chairs Barclays and London’s bank lobby, says that while his firm is on top of job moves, he’s more concerned about rewriting “hundreds of thousands” of contracts. He’s not alone. Andrew Bailey, head of the U.K. Financial Conduct Authority, said “contract continuity” was among the biggest potential disruptions from a no-deal, no-transition Brexit. Both men were testifying to lawmakers Wednesday. Bank of England Governor Mark Carney and ECB President Mario Draghi have also expressed concern about the issue and the dearth of time left for a fix. A week ago, data from the European Banking Authority showed the scope of the issue, and that money is already on the move for precisely this reason: European banks have slashed their U.K. assets by $425 billion, driven by a 35% drop in derivatives exposures.

Insurance policies are affected too: Carney estimates about 20 billion pounds of insurance liabilities in Britain could be affected without swift action. The issue arises because one side or the other of a contract can meet its obligations only thanks to an authorization that’s set to disappear once the U.K. leaves the European Union in 2019. This might result in a firm being obliged by contract law to do something that regulation prohibits it from carrying out, and impossibility generally isn’t a defense against non-performance of a contract, said Simon Gleeson at Clifford Chance in London. “A bank which enters into a contract which becomes illegal to perform by reason of Brexit may well be liable in damages for its non-performance to the counterparty,” said Gleeson. “Dealing with this is so much in everyone’s interest that I’m amazed it hasn’t been addressed.”

[..] Cross-border revolving credits – credit lines that can be drawn down, repaid, then drawn down again – are among such contracts. Many of these are issued to EU companies by syndicates with members based in the U.K. For example, lenders to Volkswagen Financial Services’s €2.5 billion ($3 billion) line include London-based entities for Bank of America and Citigroup, as well as the U.K. units of the major British banks, data compiled by Bloomberg show. A lender that lost its authorization but made an advance to the company under the revolver might find itself in breach of local law in jurisdictions including Germany and France, according to Clifford Chance. On the other hand, it might be in breach of contract if it failed to make the loan.

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Because Morgan Stanley exposes itself this way. As Corbyn himself said: Yes, we’re a threat. To you.

I’m Glad Morgan Stanley Has Warned Us About Jeremy Corbyn (Ind.)

This week, Morgan Stanley claimed that “Corbyn would be more of a danger to markets than hard Brexit”, something which I saw as supremely ironic. Because the actions of Morgan Stanley, and others like it, laid the foundations for Leave because of their role in the financial crisis: a crisis of capitalism, which ushered in seven years of austerity, falling wages and insecure work. Precisely the conditions that would encourage the majority of British people to vote against the status quo and opt for Leave. Morgan Stanley’s role in the financial crisis cannot be understated; and, given describing things as a “danger to markets” appears to be in fashion right now, let’s remind ourselves what they got up to just over a decade ago.

Essentially, they packaged up sub-prime mortgages as something called Collateralised Debt Obligations (CDOs), got credit ratings agencies – who were entirely conflicted as their clients were the investment banks – to rate these absolute garbage CDOs triple-A investments. Morgan Stanley then misled investors who bought them. Because they knew what those investments were actually worth, Morgan Stanley’s traders bought what are known as “credit default swaps” on those CDOs – effectively amounting to a bet on it defaulting. You can buy or sell a credit default swap even if you don’t own the investment. They did this thousands of times.

[..] the right-wing press, which gleefully reported on this Corbyn/Brexit warning, clearly has a short memory about what really happened. After all, the lie that Labour caused the financial crisis, and not investment banks like Morgan Stanley, was a convenient pretext for maintaining the economic status quo while cutting to public spending. This forced ordinary working people to pay for a financial crisis they did not cause. It’s little wonder that people voted Leave having been totally shafted by the system. But the opportunity to do so only arose because the narrative that “Labour crashed the economy” helped secure David Cameron a majority in 2015 on a manifesto that promised a referendum.

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Make it 2018.

US Senate Suspends Tax Bill Votes to Friday Morning (BBG)

Senate Majority Leader Mitch McConnell said votes on the tax bill will resume at 11 a.m. on Friday as the collapse of a key compromise to win a majority for a Senate tax overhaul left Republicans scrambling to salvage the legislation. Debate over the bill may continue into the evening, McConnell said. It’s unclear when the unlimited amendment vote series known as “vote-a-rama” would begin. After seeming to gain momentum during the day, the GOP’s tax cut plan smacked into a decision from the Senate’s rule-making office that said a so-called trigger proposed by GOP holdouts didn’t pass procedural muster. At least three Republicans – Bob Corker of Tennessee, Jeff Flake of Arizona and James Lankford of Oklahoma – had tied their votes to the mechanism, which would have increased taxes if revenue targets weren’t met.

The trio is now demanding that leaders agree to other changes in the bill to avoid a huge deficit increase. Republicans have a slim majority in the Senate and can only afford to lose two members if they want to pass the tax bill without Democratic support. Adding to the difficulty was a ruling by a key fiscal referee that the tax plan would blow a $1 trillion hole in the nation’s debt – even after accounting for economic growth. The day’s events left GOP leaders contemplating a variety of potentially unpalatable measures — including making some tax cuts on the individual and corporate side end within six or seven years. The current version of the Senate bill would sunset individual breaks in 2026.

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Wait till home priced start to plummet. That’s when the scandals will break.

Australian Banks Face Public Inquiry Amid String of Scandals

Australia’s banks will be subject to a wide-ranging public inquiry after Prime Minister Malcolm Turnbull bowed to pressure to address scandals besetting the industry. The yearlong royal commission will examine the conduct of the nation’s banks, insurers, financial services providers and pension funds, and consider whether regulators have enough power to tackle misconduct, Turnbull said Thursday. He pledged the inquiry would not put “capitalism on trial.” The announcement came just minutes after Commonwealth Bank of Australia, Australia & New Zealand Banking, Westpac and National Australia Bank dropped their opposition to an inquiry, saying in an open letter to the government that months of political squabbling over the issue risked undermining offshore investor confidence.

More than A$8 billion ($6 billion) was wiped off the market value of the big four lenders in early Sydney trading, with Commonwealth Bank declining as much as 2.7%. “Ongoing speculation and fear-mongering about a banking inquiry or royal commission is disruptive and risks undermining the reputation of Australia’s world-class financial system,” Turnbull said. The inquiry will “further ensure our financial system is working efficiently and effectively.” The main opposition Labor party has for months been demanding a royal commission into the finance industry, amid a string of scandals ranging from misleading financial advice, attempted rate-rigging and alleged breaches of anti-money laundering laws. Pressure was growing on Turnbull to hold an inquiry, with some lawmakers in his Liberal-National coalition threatening to force a vote in parliament next week.

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A big problem for Erdogan. The US takes its sanctions seriously.

Gold Trader Implicates Erdogan In US Sanctions Breaking Case (BBC)

A controversial Turkish-Iranian gold trader has told a US court that Turkish President Recep Tayyip Erdogan personally approved his sanction-breaking deals with Iran. Reza Zarrab, 34, is a key witness in the criminal trial of a Turkish banker whom he allegedly worked with to help Iran launder money. Mr Erdogan has denied that Turkey breached US sanctions on Iran. The case has strained relations between Ankara and Washington. In his testimony, Mr Zarrab implicated Mr Erdogan in an international money laundering scheme that he and the banker, Mehmet Hakan Atilla, ran between 2010 and 2015 that allegedly allowed Iran to access international markets despite US sanctions.

He said that he was told in 2012 by the then economy minister that Mr Erdogan, who was prime minister at the time, had instructed Turkish banks to participate in the multi-million dollar scheme. Mr Erdogan said earlier on Thursday that Turkey did not breach US sanctions on Iran, Turkish media report. His government has described the case as “a plot against Turkey”. The Turkish president is yet to respond to the new allegations about him made in court. Mr Atilla has pleaded not guilty. Nine people have been charged in total. Mr Zarrab was arrested by US officials in 2016 and accused of engaging in hundreds of millions of dollars’ worth of transactions on behalf of the Iranian government, money laundering and bank fraud. But he decided to cooperate with prosecutors and is now their star witness in the New York trial.

On Wednesday, he told the court he paid Zafer Caglayan, then Turkey’s economy minister, bribes amounting to more than €50m to facilitate deals with Iran. Turkey’s Deputy Prime Minister, Bekir Bozdag, responded to the allegations, saying that Mr Zarrab had been “pressured into committing slander”. Speaking to state-run news agency Anadolu, Mr Bozdag called the trial a “theatre”. The Turkish government had previously said that Mr Caglayan acted within Turkish and international law.

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Overcapacity export.

From The Caucasus To The Balkans, China’s Silk Roads Are Rising (Escobar)

The 19th Chinese Communist Party Congress made it clear that the New Silk Roads – aka, the Belt and Road Initiative (BRI) – launched by President Xi Jinping just four years ago, provides the concept around which all Chinese foreign policy is to revolve for the foreseeable future. Up until the symbolic 100th anniversary of the People’s Republic of China, in 2049, in fact. Virtually every nook and cranny of the Chinese administration is invested in making the BRI Grand Strategy a success: economic actors, financial players, state-owned enterprises (SOEs), the private sector, the diplomatic machine, think tanks, and – of course – the media, are all on board. It’s under this long-term framework that sundry BRI projects should be examined. And their reach, let’s be clear, involves most of Eurasia – including everything from the Central Asian steppes to the Caucasus and the Western Balkans.

Representatives of no fewer than 50 nations are currently gathered in Tbilisi, Georgia, for yet another BRI-related summit. The BRI masterplan details six major economic “corridors,” and one of these is the Central Asia-West Asia Economic Corridor. That’s where Georgia fits in, alongside neighboring Azerbaijan: both are vying to position themselves as the key Caucasus transit hub between Western China and the European Union. [..] The action in the Caucasus was mirrored in Europe earlier in the week as Chinese Premier Li Keqiang and Hungary’s Prime Minister Viktor Orban opened the sixth “16+1” summit, involving China and 16 Central and Eastern European nations, in Budapest. “16+1” is yet another of those trademark Chinese diplomatic “away wins.”

Some of these nations are part of the EU, some part of NATO, some neither. From Beijing’s point of view, what matters is the relentless BRI infrastructure and connectivity drive. Beijing may have invested as much as US$8 billion so far in Central and Eastern Europe. China is having a ball in the Western Balkans – especially in Serbia, in Montenegro, and in Bosnia and Herzegovina, where EU financial muscle is absent. China has invested in multiple connectivity and energy projects in Serbia – including the much-debated Belgrade-Budapest high-speed rail link. Construction of the Serbian stretch started this week, with 85% of the total cost (roughly €2.4 billion) coming from the Export-Import Bank of China.

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Dream of power are always costly.

Paris – The Financial Capital Of West And Central Africa (Gefira)

France’s current zone of influence in Africa is the result of the policies of President Charles de Gaulle, who was unable to come to terms with his defeats in Indochina (1954) and Algeria (1962) and therefore sought to achieve the dominance of France in his former colonies. After de Gaulle, however, other presidents did not refrain from using military force and violence in Africa to defend their interests, on the pretext of protecting human rights and democracy. The French often achieved the opposite, because they made the same mistakes in their military actions as Americans made elsewhere in the world: they supported people who later became their enemies or violated human rights.

For example, it was the regime of Juvenal Habyariman in Rwanda that was supported by Paris: the French supplied Hutu combat groups with weapons, thus contributing to the Tutsi massacre. Hollande, who in Paris and Europe was perceived as a weakling, showed the face of a warrior and sent heavy units and fighter planes to Mali in 2013. This would not have been necessary if French President Sarkozy and the USA had not overthrown Qaddafi. It was Sarkozy that initiated the NATO led airstrikes against Libya. The removal of Colonel Qaddafi gave rise to the creation of the Caliphate with the help of Tuaregs in the north of Niger and Mali. After a few years since the start of the mission in Mali one wonders: has it made Europe safer?

Has the flow of migrants been stopped through Sahel countries? Are the Jihadists of African descent a lesser threat in Europe? The cost of the military action in Mali in 2013 amounted to €650 million. Operation Barkhane (as it is called) continues to this day and costs the French budget €500 million per year. Of course, democracy in Mali is a top priority for most Europeans, right? A total of 9,000 French soldiers are currently stationed in Chad, Niger, Mali, Burkina Faso, Senegal, Gabon, the Central African Republic and Djibouti. The growing military presence is intended to support the fight against terrorism and crime, in fact it is about the French elites extending their power to the south, reaching for cheap raw materials and outlet markets.

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“..if we can identify it is dark matter for sure then that is very significant. And if not, it is even more significant because they would be fresh new particles that no one had predicted before..”

Chinese Satellite Closes In On Dark Matter Mystery (AFP)

Scientists have detected cosmic ray energy readings that could bring them closer to proving the existence of dark matter, a mysterious substance believed to comprise a quarter of our universe, a study revealed on Thursday. Likely made up of unknown sub-atomic material, dark matter is invisible to telescopes and can be perceived only through its gravitational pull on other objects in the universe. Beijing’s first astronomical satellite launched two years ago detected 1.5 million cosmic ray electrons and protons, the study said, and unprecedented measurements found curiously low-energy rays. The team of researchers from China, Switzerland and Italy, who published their first results in the journal Nature, said the data may cast light on “the annihilation or decay of particle dark matter”.

“This new unseen phenomena can bring breakthroughs,” Bai Chunli, president of the Chinese Academy of Sciences, said at a briefing. “After collecting more data, if we can identify it is dark matter for sure then that is very significant. And if not, it is even more significant because they would be fresh new particles that no one had predicted before,” Bai added, to applause from fellow scientists. The Dark Matter Particle Explorer (DAMPE) is now collecting more data from space to help researchers figure out what it could be. DAMPE was launched from the Jiuquan Satellite Launch Centre in the Gobi desert in December 2015, after nearly 20 years in development. Its designers boast that DAMPE is superior to its US counterpart, the AMS-02 (Alpha Magnetic Spectrometer) that NASA installed on the International Space Station in 2011.

“Our cosmic ray detection range is 10 times that of AMS-02 and three times as accurate,” said DAMPE chief scientist Chang Jin. “Proving the existence of dark matter takes a lot of time. Now we have worked out the most precise spectrum, but we are not 100% sure that this can lead us to the location of dark matter,” he said.

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Jul 052016
 
 July 5, 2016  Posted by at 12:20 pm Finance Tagged with: , , , , , ,  2 Responses »


Dorothea Lange Miserable poverty. Elm Grove, Oklahoma County, OK 1936

We used to have this saying that if someone asks you to do a job good, fast and cheap, you’d say: pick two. You can have it good and cheap, but then it won’t be fast, etc. As our New Zealand correspondent Dr. Nelson Lebo III explains below, when it comes to our societies we face a similar issue with our climate, energy and the economy.

Not the exact same, but similar, just a bit more complicated. You can’t have your climate nice and ‘moderate’, your energy cheap and clean, and your economy humming along just fine all at the same time. You need to make choices. That’s easy to understand.

Where it gets harder is here: if you pick energy and economy as your focus, the climate suffers (for climate you can equally read ‘the planet’, or ‘the ecosystem’). Focus on climate and energy, and the economy plunges. So far so ‘good’.

But when you emphasize climate and economy, you get stuck. There is no way the two can be ‘saved’ with our present use of fossil fuels, and our highly complex economic systems cannot run on renewables (for one thing, the EROEI is not nearly good enough).

It therefore looks like focusing on climate and economy is a dead end. It’s either/or. Something will have to give, and moreover, many things already have. Better be ahead of the game if you don’t want to be surprised by these things. Be resilient.

But this is Nelson’s piece, not mine. The core of his argument is worth remembering:

Everything that is not resilient to high energy prices and extreme weather events will become economically unviable…

…and approach worthlessness. On the other hand,…

Investments of time, energy, and money in resilience will become more economically valuable…

Here’s Nelson:

 

 

Nelson Lebo: There appear to be increasing levels of anxiety among environmental activists around the world and in my own community in New Zealand. After all, temperature records are being set at a pace equal only to that of Stephen Curry and LeBron James in the NBA Finals. A recent Google news headline said it all: “May is the 8th consecutive month to break global temperature records.”

In other words, October of last year set a record for the highest recorded global monthly temperature, and then it was bettered by November, which was bettered by December, January, and on through May. The hot streak is like that of Lance Armstrong’s Tour De France dominance, but we all know how that turned out in the end.

Making history – like the Irish rugby side in South Africa recently – is usually a time to celebrate. Setting a world record would normally mean jubilation – not so when it comes to climate.

Responses to temperature records range from sorrow, despair, anger, and even fury. Anyone with children or grandchildren (and even the childless) who believes in peer review and an overwhelming scientific consensus has every right to feel these emotions. So why do I feel only resignation?

We are so far down the track at this point that we are damned if we do and damned if we don’t. Remember the warnings 30 years ago that we needed 30 years to make the transition to a low carbon economy or else there would be dire consequences? Well, in case you weren’t paying attention, it didn’t happen.

While these warnings were being issued by scientists much of the world doubled down – Trump-like – on Ford Rangers, Toyota Tacomas, and other sport utility vehicles. The same appears to be happening now, with the added element that we are experiencing the dire consequences as scientists issue even more warnings and drivers buy even more ‘light trucks’. Forget Paris, the writing was on the wall at Copenhagen.

 

The bottom line is that most people will (and currently do) experience climate change as a quality of life issue, and quality of life is related to a certain extent to disposable income. Acting or not acting proactively or reactively on climate change is expensive and gets more expensive every day.

If the international community ever takes collective action on climate change it will make individuals poorer because the cost of energy will rise significantly. If the international community fails to act, individuals will be made poorer because of the devastating effects of extreme weather events – like last year’s historic floods where I live as well as in northern England, etc – shown to be on the increase over the last 40 years in hundreds of peer-reviewed papers with verifiable data.

And here is the worst part: most economies around the world rely on some combination of moderate climate and cheap fossil fuels. For example, our local economy is heavily dependent on agriculture and tourism, making it exceptionally vulnerable to both acting AND not acting on climate change.

Drought hurts rural economies and extreme winds and rainfall can cost millions in crop damage as well as repairs to fencing, tracks and roads. As a result, both farmers and ratepayers have fewer dollars in their pockets to spend on new shoes, a night out, or a family trip. This is alongside living in a degraded environment post-disaster. The net result is a negative impact on quality of life: damned if we don’t.

On the other hand, tourism relies on inexpensive jet fuel and petrol to get the sightseers and thrill seekers to and around the world with enough dollars left over to slosh around local economies. Think about all of the service sector jobs that rely on tourism that in turn depend entirely on a continuous supply of cheap fuel. (This is not to mention peak oil and the lack of finance available to fund any long and expensive transition to an alternative energy world.) I’m told 70% of US jobs are in the service sector, most of which rely on inexpensive commuting and/or a highly mobile customer base.

Any significant approach to curbing carbon emissions in the short term will result in drastic increases to energy prices. The higher the cost of a trip from A to Z the less likely it is to be made. As a result, business owners and ratepayers at Z will have fewer dollars in their pockets to spend on new shoes, a night out, or a family vacation of their own. The net result is a negative impact on their quality of life: damned if we do.

 

I suppose it deserves repeating: most OECD economies and the quality of life they bring rely on both moderate climate and cheap fossil fuels, but these are mutually exclusive. Furthermore, regardless of emissions decisions made by the international community, we are already on track for decades of temperature records and extreme weather events that will cost billions if not trillions of dollars.

The response in many parts of the world has been to protest. That’s cool, but you can’t protest a drought – the drought does not care. You can’t protest a flood – the flood does not care. And even if the protests are successful at influencing government policies – which I hope long-term they are – we are still on track for decades of climatic volatility and the massive price tags for clean up and repair.

Go ahead and protest, people, but you better get your house in order at the same time, and that means build resilience in every way, shape and form.

Resilience is the name of the game, and I was impressed with Kyrie Irving’s post NBA game seven remarks that the Cleveland Cavaliers demonstrated great resilience as a team.

As I wrote here at TAE over a year ago, Resilience Is The New Black. If you don’t get it you’re not paying attention.

This article received a wide range of responses from those with incomplete understandings of the situation as well as those in denial – both positions dangerous for their owners as well as friends and neighbours.

The double bind we find ourselves in by failing to address the issue three decades ago is a challenge to put it mildly. Smart communities recognize challenges and respond accordingly. The best response is to develop resilience in the following areas: ecological, equity, energy and economic.

The first two of these I call the “Pope Index” because Francis has identified climate change and wealth inequality as the greatest challenges facing humanity. Applying the Pope Index to decision making is easy – simply ask yourself if decisions made in your community aggravate climate change and wealth inequality or alleviate them.

For the next two – energy and economics – I take more of a Last Hours of Ancient Sunlight (credit, Thom Hartmann) perspective that I think is embraced by many practicing permaculturists. Ancient sunlight (fossil fuels) is on its way out and if we do not use some to build resilient infrastructure on our properties and in our communities it will all be burned by NASCAR, which in my opinion would be a shame.

As time passes, everything that is not resilient to high energy prices and extreme weather events will become economically unviable and approach worthlessness.

On the other hand, investments of time, energy, and money in resilience will become more economically valuable as the years pass.

Additionally, the knowledge, skills and experience gained while developing resilience are the ultimate in ‘job security’ for an increasingly volatile future.

If you know it and can do it and can teach it you’ll be sweet. If not, get onto it before it’s too late.

 

 

Dr. Nelson Lebo is a serial permaculture property developer and consultant. He likes underdogs but not drug cheats. Congratulations Cleveland and Ireland.