Sep 122018
 
 September 12, 2018  Posted by at 1:17 pm Finance Tagged with: , , , , , , , , , ,  


Winslow Homer Salt Kettle, Bermuda 1899

 

In the wake of a number of the Lehman and 9/11 commemorations in America, and as a monster storm is once again threatening to cause outsize damage, we find ourselves at a pivotal point in time, which will decide how the country interacts with its own laws, its legal system, its Constitution, its freedom of speech, and indeed if it has sufficient willpower left to adhere to the Constitution as its no. 1 guiding principle.

The main problem is that it all seems to slip slide straight by the people, who are -kept- busy with completely different issues. That is convenient for those who would like less focus on the Constitution, but it’s also very dangerous for everyone else. Americans should today stand up for freedom of speech, or it will be gone, likely forever.

The way it works is that president Trump is portrayed as the major threat to ‘the rule of law’, which allows other people, as well as companies and organizations, to drop below the radar and devise and work on plans and schemes that threaten the country itself, and its future as a nation ruled by its laws.

Bob Woodward’s book “Fear: Trump in the White House” and the anonymous op-ed published in the NYT a day later serve as a good reminder of these dynamics. If you succeed in confirming people’s idea that Trump is such an unhinged idiot that an unelected cabal inside the White House is needed to save the nation from the president it elected, you’re well on your way.

Well on your way to separate the country from its own laws, that is. Not on your way to saving it. You can’t save America by suspending its Constitution just because that suits your particular political goals or points of view.

 

Late last night, Michael Tracey wrote on Twitter: “Trump’s preference to pull out of Afghanistan is depicted in the Woodward book as yet another crazy impulse that the “adults in the room” successfully rein in.” “We’re going to save you from yourselves, thank us later!” Nobody voted for those adults in the room anymore than anyone voted for the Afghanistan ‘war’ to enter year 17.

Meanwhile Infowars said: “Several people within Trump’s inner circle know the threat to the mid-terms and his re-election chances that social media censorship poses, including Donald Trump Jr. and Brad Parscale, his 2020 campaign manager. However, older members of the administration are completely unaware of the fact that banning prominent online voices and manipulating algorithms can shift millions of votes and are oblivious to the danger. This ignorance has placed a temporary block on Trump taking action, despite the president repeatedly referring to Big Tech censorship in tweets and speeches over the last few weeks.”

Yes, Infowars, I know, everybody loves to hate Alex Jones. And perhaps for good reasons, at least at times. But does that mean he can be banned from a whole slew of internet platforms without this having been run by and through the US court system? Without even one judge having examined the ‘evidence’, if it even existed, that leads to such banning, blocking and shadowbanning?

Alex Jones is an ‘easy example’ because he’s so popular. Which is also, undoubtedly, why all the social media platforms ban him so easily, and all at the same time. ‘He’s a terrible person’, say so many of their readers. But that’s not good enough, far from it. Twitter and Facebook should never be allowed to ban anyone, using opaque ‘Community Standards’ or ‘Terms and Conditions’ interpreted by kids fresh out of high school.

These platforms have important societal functions. They are for instance the new conduits governments, police, armies use to warn people in case of emergencies and disasters. You can’t ban people from those conduits just because a bunch of geeks don’t like what they say. If you can at all, it will have to be done through the legal system.

That this is not done at present poses an immense threat to that legal system, and to the Constitution itself. But Americans, and indeed Congressmen and Senators, have been trained in a Pavlovian way to believe that it’s not Google and Facebook who threaten the Constitution, but that it’s Trump and his crew.

 

Meanwhile, Trump is being put through Bob Mueller’s Special Counsel legal wringer 24/7, while Alphabet, Jack Dorsey and Mark Zuckerberg escape any such scrutiny at all. That discrepancy, too, is eating away at the foundations of American law.

And like it or not, Trump had it right when he said “You look at Google, Facebook, Twitter and other social media giants and I made it clear that we as a country cannot tolerate political censorship, blacklisting and rigged search results..”

America as a country cannot tolerate a few rich companies deciding whose voice can be heard, and whose will be silenced. It is entirely unacceptable. That goes for voices Trump doesn’t want to hear as much as it does for whoever Silicon Valley doesn’t. That’s why neither should be in charge of making such decisions. It kills the Constitution.

None of the above means that everyone should be free to post terrorist sympathies or hate speech on social media platforms. But it does mean that legislative and judicial systems must define what these things mean, that this not be left up to arbitrary ‘Community Standards’ interpreted by legally inept Silicon Valley interns, nor should it be left to secret algorithms to decide what news you see and what not.

America itself hangs in the balance, and so do many other western countries. What exactly is the difference between China’s overt internet censorship and America’s hidden one? That is what needs to be defined, and that can only be done by the legal system, by Congress, by the courts, by judges and juries.

And it’s not something that has to be invented from scratch, it can and must be tested against the Constitution. That is the only way forward. That social media have taken over the country by storm, and nary a soul has any idea what that means, can never be an excuse to leave banning and silencing voices over to private parties, whoever they are.

 

It’s not a unique American problem. In Europe there are all sorts of attempts to ban ‘hate speech’, but there are very few proposals concerning who will define what that is. And since Europe has no Constitution, but instead has 27 different versions of one, it will be harder there. Then again, it will also be easier to get away with all sorts of arbitrary bannings etc.

Hungary will be inclined to ban totally different voices than for instance Denmark and so on. And nobody over there has given any sign of understanding how dangerous that is. Banning ‘hate speech’ doesn’t mean anything if the term hasn’t been properly defined. But that also allows for banning voices someone simply doesn’t like. To prevent that from happening, we have legal systems.

It’s essential, it’s elementary, Watson. But it’s slipping through our fingers because our politicians are either incapable of, or unwilling to, comprehending the consequences. Why stick out your neck when nobody else does? It’s like the anti-thesis of what politics means: stay safe.

So the social media’s industry’s own lobbying has a good shot at getting its way: they tell Washington to let them regulate themselves, and everything will be spic and dandy. That would be the final nail in the Constitution’s coffin, and it’s much closer than you think. Do be wary of that.

 

In the end it comes down to two things i’ve said before. First, there is no-one who’s been as ferociously banned and worse the way Julian Assange has. His ban goes way beyond Silicon Valley, but it does paint a shrill portrait of how far the US, CIA, FBI, is willing to go, and to step beyond the Constitution, to get to someone they really don’t like.

But has Assange ever violated and US law, let alone its Constitution? Not that we know of. Mike Pompeo has called WikiLeaks a ‘hostile intelligence service’, and the DOJ has said the 1st Amendment, and thereby of necessity the entire US Constitution, doesn’t apply to Assange because he’s not an American, but both those things are devoid of any meaning, at least in a court of law.

Bob Woodward has an idea of what Assange faces, and he’d do much better to focus on helping him than trying to put Trump down through anonymous sources. And that also leads me to why I, personally, have at least some sympathy for Alex Jones, other than because he’s being attacked unconstitutionally: Jones ran/runs a petition for Trump to free Julian Assange.

Come to think of it: it’s when that petition started taking off that Jones’s ‘real trouble’ started. Given how closely interwoven Silicon Valley and the FBI and CIA have already become, I’m not going to feign any surprise at that.

And before you feel any wishes and desires coming up to impeach Trump, do realize that he may be the only person standing between you and a complete takeover of America by the FBI/NSA/CIA/DNC and Google/Facebook/Twitter, which will be accompanied by the ritual burial of the Constitution.

Think Trump is scary? Take a step back and survey the territory.

 

 

 

 

Aug 202018
 
 August 20, 2018  Posted by at 1:05 pm Finance Tagged with: , , , , , , , ,  


Pablo Picasso Science and Charity 1897

 

I thought I’d make list of things we can expect to emanate from the White House over the coming year or so. I’m sure you will agree, wherever you stand on the political roller coaster, that there’s little chance things are going to be boring going forward. Here goes:

 

Trump will end the ‘monopolies’ of Facebook, Google, Twitter et al. The intelligence community will hate this, but they already hate him anyway, so why bother? And besides, it’s the only thing to do that makes any sense. The AT&T model might be useful, essentially creating Baby Bells, though the international reach of the companies may add a layer or two of complications.

But you simply can’t have a few roomfuls of boys and girls ban and shadowban people with impunity from networks that span the globe and reach half of the world’s population on the basis of opaque ‘Terms and Conditions’ that in effect trump the US constitution the way they are used and interpreted. Whether they are private companies or not will make no difference in the end.

At some point an ‘entity’ becomes a ‘utility’. Twitter and Facebook already are the most efficient way to alert people in cases of emergency. To throw people out of such systems is indefensible.

The CIA and FBI will protest like there’s no tomorrow, but they have to realize that spying on Americans the way they do at present in conjunction with Alphabet and Facebook is just as indefensible as throwing people off these services. The judicial system will at some point be forced to curtail these powers. Better for the executive power to be ahead of that. Baby Bells it is.

 

Trump will tell his people to open up to Mueller . He’s already done this, but will do it again, loudly and publicly, citing the need to wrap up the Mueller investigation ASAP. That will be the target: stop the ‘inquisition’. Mueller has talked for 30 hours over the past nine months to White House lawyer Donald McGahn II, and at some point enough is enough.

As I cited a few days ago, Trump’s legal team has given Mueller until September 1 to talk to the president, and that’s it. It doesn’t look like that’s going to happen, Giuliani again said he doesn’t want to rush Trump into a perjury trap, but Mueller has had plenty time to have that talk. The investigation risks being used as a political tool in the midterms, and that can’t happen.

 

Moreover, since US District Court Judge Amit Mehta has ruled that the FBI must release documents pertaining to what it knew about the ‘veracity’ of the Steele dossier, the most consequential reason to start the Special Counsel investigation in the first place may well soon be going going gone.

The FBI offered to pay Steele $50,000 for evidence that what was in his report was true, and they never paid that money. Ergo, it is reasonable to conclude that he never delivered the evidence. This points to huge potential problems for the FBI, the DNC -which financed the dossier-, Steele himself, and various other parties. How about James Comey?

Since the judge’s ruling was a direct effect of Trump declassifying the Nunes and Schiff memos in February, count on one thing: Trump will declassify many more documents . Judge Mehta ruled in January that the FBi didn’t have to “disclose the existence of any records containing the agency’s efforts to verify the dossier”, but now says that after Trump declassified the memos ‘the ground shifted’.

In other words, once docs are declassified, intelligence services no longer have a place to hide. Trump is thinking: why didn’t I do this much more and much sooner? Note: it still took 6 months for the judge to rule on the FBI and the memos, but next time this could go much faster. And there are thousands of files that could be de-classified.

 

Trump will revoke the security clearance of many former FBI and CIA agents whose names have come up in connection with Russiagate. He needs to do this so they can’t get in the way of the Second Special Counsel he’s going to initiate. By now, there are many more reasons for the second counsel than there ever were for the first.

Mueller is going after George Papadopoulos, a nobody, because he’s the only person who allegedly ever mentioned Russians. Everyone else he’s focused on has only ever been indirectly -at best- connected to Russia. But Papadopoulos was allegedly caught saying the R-word when he was drunk, to some never properly identified ‘professor’.

And that’s the only ‘link’ between Russia and the Trump campaign that we’ve ever seen. It is at times like this that we can see how shaky and shady the entire Mueller file was from the get-go. And why that Second Special Counsel will become reality. If you’d like to read a very long and detailed report on this, I recommend Barbara Boyd’s damning Fish Stinks From the Head Down for LaRouchePAC:

In the past week, we have learned that Steele was being paid as a human source by the FBI early in as of February 2016, if not sooner, based on a release of his highly redacted FBI file to Judicial Watch in a FOIA suit. After he was fired as an official FBI human source in October 2016, based on the obvious fact that he was using his FBI relationship as coinage in the information warfare operation he was running against Donald Trump for the British government, Barack Obama, and Hillary Clinton, his relationship to the FBI was continued through a back channel.

That channel was the Number Four attorney at the U.S. Department of Justice, Bruce Ohr, whose wife, Nellie, worked for Steele’s American employer, Fusion GPS, on the Trump Russiagate project. According to documents finally released to Congress by the Justice Department, Ohr would meet with Steele, who would convey new “information,” and then meet with the FBI to convey Steele’s findings.

This relationship lasted through May 2017, if not later. Ohr’s meetings with the FBI were meticulously recorded on formal FD 302s by the FBI agents, the Deputy Associate Attorney General of the United States having become, in effect, an FBI informant in order to circumvent Christopher Steele’s firing as an informant for egregious violations of FBI Guidelines. Steele sought Ohr’s intervention when Senators Lindsay Graham and Chuck Grassley referred him to the Department of Justice for prosecution because of lies he told the FBI. Steele also sought Ohr’s help in getting placed on Robert Mueller’s investigative team.

Boyd provides a lot of additional details of a part of the Mueller investigation that has so far barely been mentioned: the involvement of British intelligence. And on the link between Christopher Steele and Victoria Nuland.

 

Finally, Trump will push for Julian Assange to testify -with immunity- to probably the Senate Intelligence Committee (but there are alternative options) on what he knows about -potential- Russian involvement in US election meddling and hacking of DNC or RNC servers and computers. There’s no-one who know more on this than Assange, and he has evidence.

That his deal with the DOJ was killed by James Comey will be all the more impetus for Trump to hear what he has to say. For many people, it will appear ironic, but this may be Assange’s best bet to regain freedom.

The one person who can prove that there was never any collusion between Trump and Russia is locked up in a tiny embassy in London. And the one person who can get him out of there lives in the White House.

 

 

May 202018
 
 May 20, 2018  Posted by at 10:13 am Finance Tagged with: , , , , , , , , , , , ,  


Roman Vishniac Isaac Street, Krakow 1930s

 

Stefan Halper: The FBI Informant Who Monitored the Trump Campaign (GG)
IG Horowitz Finds FBI, DOJ Broke Law In Clinton Probe (ZH)
China Agrees To Bolster Purchases Of US Goods (CNBC)
With Iran Sanctions Trump Made Europeans Look Like The Fools They Are (RT)
Europe, China, Russia Discussing New Deal For Iran (R.)
Now Facebook Serves NATO’s Agenda (McDonald)
Hedge Funds Bet On Big Turnaround By Italy’s Mid-Tier Banks (R.)
Companies Are Now Paying Off Their Employees’ Student Loans (CNBC)
What Happens In An Internet Minute In 2018? (WEF)
Drunk People Are Better at Creative Problem Solving (HBR)

 

 

Why not just call him a spy?

Stefan Halper: The FBI Informant Who Monitored the Trump Campaign (GG)

An extremely strange episode that has engulfed official Washington over the last two weeks came to a truly bizarre conclusion on Friday night. And it revolves around a long-time, highly sketchy CIA operative, Stefan Halper. Four decades ago, Halper was responsible for a long-forgotten spying scandal involving the 1980 election, in which the Reagan campaign – using CIA officials managed by Halper, reportedly under the direction of former CIA Director and then-Vice-Presidential candidate George H.W. Bush – got caught running a spying operation from inside the Carter administration. The plot involved CIA operatives passing classified information about Carter’s foreign policy to Reagan campaign officials in order to ensure the Reagan campaign knew of any foreign policy decisions that Carter was considering.

Over the past several weeks, House Republicans have been claiming that the FBI during the 2016 election used an operative to spy on the Trump campaign, and they triggered outrage within the FBI by trying to learn his identity. The controversy escalated when President Trump joined the fray on Friday morning. “Reports are there was indeed at least one FBI representative implanted, for political purposes, into my campaign for president,” Trump tweeted, adding: “It took place very early on, and long before the phony Russia Hoax became a “hot” Fake News story. If true – all time biggest political scandal!”

In response, the DOJ and the FBI’s various media spokespeople did not deny the core accusation, but quibbled with the language (the FBI used an “informant,” not a “spy”), and then began using increasingly strident language to warn that exposing his name would jeopardize his life and those of others, and also put American national security at grave risk. On May 8, the Washington Post described the informant as “a top-secret intelligence source” and cited DOJ officials as arguing that disclosure of his name “could risk lives by potentially exposing the source, a U.S. citizen who has provided intelligence to the CIA and FBI.”

Read more …

Excellent from Zero Hedge. Things are going to change. Read the whole thing.

IG Horowitz Finds FBI, DOJ Broke Law In Clinton Probe (ZH)

As we reported on Thursday, a long-awaited report by the Department of Justice’s internal watchdog into the Hillary Clinton email investigation has moved into its final phase, as the DOJ notified multiple subjects mentioned in the document that they can privately review it by week’s end, and will have a “few days” to craft any response to criticism contained within the report, according to the Wall Street Journal. “Those invited to review the report were told they would have to sign nondisclosure agreements in order to read it, people familiar with the matter said. They are expected to have a few days to craft a response to any criticism in the report, which will then be incorporated in the final version to be released in coming weeks.” -WSJ

Now, journalist Paul Sperry reports that “IG Horowitz has found “reasonable grounds” for believing there has been a violation of federal criminal law in the FBI/DOJ’s handling of the Clinton investigation/s and has referred his findings of potential criminal misconduct to Huber for possible criminal prosecution.” Sperry also noted on Twitter that the FBI and DOJ had been targeting former National Security Advisor Mike Flynn before his December 2016 phone call with Russian Ambassador Sergey Kislyak, stemming from photos of Flynn at a December 2015 Moscow event with Vladimir Putin (and Jill Stein). As we reported in March, Attorney General Jeff Sessions appointed John Huber – Utah’s top federal prosecutor, to be paired with IG Horowitz to investigate the multitude of accusations of FBI misconduct surrounding the 2016 U.S. presidential election.

The announcement came one day after Inspector General Michael Horowitz confirmed that he will also be investigating allegations of FBI FISA abuse. While Huber’s appointment fell short of the second special counsel demanded by Congressional investigators and concerned citizens alike, his appointment and subsequent pairing with Horowitz is notable – as many have pointed out that the Inspector General is significantly limited in his abilities to investigate. Rep. Bob Goodlatte (R-VA) noted in March “the IG’s office does not have authority to compel witness interviews, including from past employees, so its investigation will be limited in scope in comparison to a Special Counsel investigation,” Sessions’ pairing of Horowitz with Huber keeps the investigation under the DOJ’s roof and out of the hands of an independent investigator.

Read more …

You’ll need to put meat on that bone.

China Agrees To Bolster Purchases Of US Goods (CNBC)

China and the U.S. have mutually agreed to “substantially reduce” the yawning trade imbalance between the two countries, a joint statement read on Saturday, in a move that will involve the Chinese boosting more of what they buy from American producers. Amid fears of a global trade war and rising tensions between the world’s two largest economies, both China and the U.S. have entered bilateral talks to bolster cooperation. In a statement issued by the White House, both parties forged a “consensus on taking effective measures to substantially reduce the United States trade deficit in goods with China.”

Just a day ago, both countries were sharply at odds over a claim, made by White House Economic Advisor Larry Kudlow, that China would move to cut its trade deficit with the U.S. by $200 billion annually. That characterization was disputed by Chinese officials. Left unclear was exactly how much the Chinese would boost its purchases of U.S. goods. The Wall Street Journal reported on Saturday that China’s delegation rebuffed American demands to commit to an exact deficit reduction figure, and the two sides bickered all night over the statement’s language. The trade imbalance has long been a thorny and intractable topic in the Sino-US relationship.

Commerce Department data recently showed that imbalance between what China buys from the U.S. and vice versa hit a record in 2017 at over $375 billion. However, President Donald Trump has staked a resolution of the dispute on his personal relationship with Chinese President Xi Jinping. This week, Kudlow stated that China was “meeting many” Trump administration demands to cut its U.S. surplus. The statement released on Saturday struck a conciliatory tone. “To meet the growing consumption needs of the Chinese people and the need for high-quality economic development, China will significantly increase purchases of United States goods and services. This will help support growth and employment in the United States,” it read.

Read more …

John Laughland: “..the constitutional charter of the EU subordinates it to NATO, which the USA dominates legally and structurally ..”

With Iran Sanctions Trump Made Europeans Look Like The Fools They Are (RT)

First, the links between the EU and the US are not only very long-standing, they are also set in stone. NATO and the EU are in reality Siamese twins, two bodies born at the same time which are joined at the hip. The first European community was created with overt and covert US support in 1950 in order to militarize Western Europe and to prepare it to fight a land war against the Soviet Union; NATO acquired its integrated command structure a few months later and its Supreme Commander is always an American.

Today the two organizations are legally inseparable because the consolidated Treaty on European Union, in the form adopted at Lisbon in 2009, states that EU foreign policy “shall respect” the obligations of NATO member states and that it shall “be compatible” with NATO policy. In other words, the constitutional charter of the EU subordinates it to NATO, which the USA dominates legally and structurally. In such circumstances, European states can only liberate themselves from US hegemony, as Donald Tusk said they should, by leaving the EU. It is obvious that they are not prepared to do that.

Second, EU leaders have burned their own bridges with other potential partners, especially Russia. Angela Merkel traveled to Russia on Friday but only a few weeks ago more than half of the EU member states expelled scores of Russian diplomats and encouraged non-EU European states like Ukraine and Montenegro to do the same, in retaliation for the poisoning in Salisbury of Sergei and Julia Skripal.

How is Mrs Merkel going to convince Mr Putin to join her in keeping Iran’s nuclear program under control if she officially thinks that Mr Putin is guilty of secretly stockpiling and using chemical weapons for assassinations in the West? Only a few weeks later, in mid-April, Britain and France, together with the US, attacked Syria on the basis that its army had used chemical weapons at Douma with Russian backing. If they try to turn on the charm now in Sochi or in Moscow, do they really expect the Russians can take them seriously?

Read more …

It might yet work.

Europe, China, Russia Discussing New Deal For Iran (R.)

Diplomats from Europe, China and Russia are discussing a new accord to offer Iran financial aid to curb its ballistic missile development and meddling in the region, in the hope of salvaging its 2015 nuclear deal, a German newspaper reported on Sunday. The officials will meet in Vienna in the coming week under the leadership of senior European Union diplomat Helga Schmid to discuss next steps after the May 8 decision by U.S. President Donald Trump to pull out of a 2015 nuclear accord with Iran, the Welt am Sonntag newspaper said, citing senior EU sources. Germany, France, Britain, Russia and China would participate in the meeting, but the United States would not, it said. It was not immediately clear if Iran – which has resisted calls to curb its ballistic missile program in the past – would take part.

Under the 2015 deal, Iran agreed to curb its nuclear program in return for the lifting of most Western sanctions. One of the main complaints of the Trump administration was that the accord did not cover Iran’s missile program or its support for armed groups in the Middle East which the West considers terrorists. Concluding a new agreement that would maintain the nuclear provisions and curb ballistic missile development efforts and Tehran’s activities in the region could help convince Trump to lift sanctions against Iran, the paper said. “We have to get away from the name ‘Vienna nuclear agreement’ and add in a few additional elements. Only that will convince President Trump to agree and lift sanctions again,” the paper quoted a senior EU diplomat as saying.

Read more …

CIA, military, they all want in.

Now Facebook Serves NATO’s Agenda (McDonald)

Facebook has engaged a think tank funded by weapons manufacturers, branches of the US military and Middle-Eastern monarchies to safeguard the democratic process. It’s akin to hiring arsonists to run the fire brigade.
If Facebook truly wanted to “protect democracy and elections worldwide,” it would build a broad coalition of experts and activists from a wide and disparate range of the countries it serves. Instead, the American social media giant has outsourced the task to NATO’s propaganda wing. For the uninitiated, the Atlantic Council serves as the American-led alliance’s chief advocacy group. And its methods are rather simple: it grants stipends and faux academic titles to various activists that align with NATO’s agenda.

Thus, lobbyists become “fellows” and “experts,” while the enterprise constructs a neutral sheen, which is rarely (if ever) challenged by Western media outlets – often reliant on its employees for easy comment and free op-eds. While that has always been ethically questionable, Facebook’s latest move, given its effective monopoly position, is far more sinister. Because it is now tied to a “think tank” which has proposed terrorist attacks in Russia and has demanded Russian-funded news outlets be forced to register as “foreign agents” in the United States. Make no mistake: this is a dream scenario for NATO and those who depend on it for their livelihoods and status. Because the Atlantic Council is now perfectly positioned to be the tail wagging the Facebook dog in the information space.

On Thursday, the social network announced how it was “excited to launch a new partnership with the Atlantic Council, which has a stellar reputation looking at innovative solutions to hard problems.” It then added that “experts” from the Atlantic Council’s Digital Forensic Research Lab (DFRL) will liaise closely with Facebook’s “security, policy and product teams” to offer “real-time insights and updates on emerging threats and disinformation campaigns from around the world.” Now, this sort of talk would be fine if Facebook had assembled a diverse group, comprised of stakeholders from a wide range of democracies. But, by selecting a clearly biased actor to police “misinformation and foreign interference” during “elections and other highly sensitive moments” and also work to “help educate citizens as well as civil society,” Mark Zuckerberg’s team has essentially made their company a tool of the US military agenda.

Read more …

Wonder what the new government will do to this.

Hedge Funds Bet On Big Turnaround By Italy’s Mid-Tier Banks (R.)

Major hedge funds have picked Italian mid-tier banks as one of Europe’s few remaining recovery plays, betting they will shed billions of euros in bad loans. Europe’s 2010-2012 debt crisis left Italy’s banks with among the euro zone’s biggest hangovers, some 285 billion euros ($338 billion) of soured debt on their balance sheets. But when Credito Valtellinese sold new shares in a February rights issue for eight times its market value, they were lapped up by hedge funds in the United States and Britain. Now the mid-sized Italian bank counts Algebris Chief Investment Officer Davide Serra, Toscafund Asset Management and a hedge fund run by Eurizon Capital SGR among its biggest investors, Thomson Reuters data shows.

So far the bet seems to be paying off as Italy’s bank shares have risen 15% year-to-date against a fall of 1% for European banks, while Credito Valtellinese stock has risen 7.5% since the rights issue completion. Although the price-to-book ratio of Italian banks has improved since Rome announced a state bailout fund in 2016, it trades around 8% below the European sector average. Even the possible formation of a new government comprising two anti-establishment parties has not put off many of the funds contacted by Reuters, some of whom invested in Greek government bonds on a similar bet, who said the investment stacked up despite the vagaries of Italian politics.

Italy’s bad loans are a legacy of the recession that followed the debt crisis and with small and medium-sized businesses heavily dependent on bank lending, the soured loans have long been a drag on the third biggest euro zone economy. But pressure from regulators has begun to have an impact and the ratio of gross impaired loans to total loans has fallen to 14.5% from 17.3% a year ago, Bank of Italy data shows ..

Read more …

But move away from paying for the education.

Companies Are Now Paying Off Their Employees’ Student Loans (CNBC)

Student loan assistance, which started as a niche offering by a handful of companies, is finding its way into the mainstream menu of workplace benefits. “This is certainly emerging as a new and very important benefit,” said David Pratt, a professor at Albany Law School who studies employee benefits. This year, Fidelity began to offer businesses a way to contribute to their workers’ education debt. Since then, more than two dozen companies have signed up and it expects that number to double by the year’s finish. “This is going to grow rapidly over time,” said Asha Srikantiah, vice president of workplace emerging products at Fidelity. “We’re seeing so many more people who have debt and who are overwhelmed by that.”

Indeed, 7 in 10 college graduates have student loan debt. The average person leaves school $30,000 in arrears, while nearly 20% owe more than $100,000. Americans are now more burdened by education loans than they are by credit card or auto debt. [..] one of the factors likely contributing to the nation’s swelling student loan debt is that the number of employers helping their workers with their original education costs is shrinking. Company contributions to undergraduate education expenses dropped to 53% in 2017, from 61% in 2013, according to the Society for Human Resource Management. During that same time period, graduate school assistance at work also fell, to 50% from about 60%.

Read more …

100 trillion emails per year.

What Happens In An Internet Minute In 2018? (WEF)

In your everyday life, a minute might not seem like much. But when it comes to the vast scale of the internet, a minute of time goes much further than you ever could have imagined. That’s because the internet has a degree of scale that our linear human brains are unaccustomed to operating on. Today’s infographic is from Lori Lewis and Chadd Callahan of Cumulus Media, and it shows the activity taking place on various platforms such as Facebook or Google in each 60 second span. It really helps put an internet minute in perspective.

The numbers for these services are so enormous that they can only be shown using the 60 second time scale. Any bigger, and our brains can’t even process these massive quantities in any useful capacity. Here are just a few key numbers scaled to a monthly basis, for fun: • 42,033,600,000 Facebook logins • 159,840,000,000 Google searches • 1,641,600,000,000 WhatsApp messages sent • 8,078,400,000,000 emails sent On an annualized basis, the data becomes even more ridiculous, with something close to 100 trillion emails sent.

Read more …

The world’s biggest problems are solved in bars.

Drunk People Are Better at Creative Problem Solving (HBR)

Professor Andrew Jarosz of Mississippi State University and colleagues served vodka-cranberry cocktails to 20 male subjects until their blood alcohol levels neared legal intoxication and then gave each a series of word association problems to solve. Not only did those who imbibed give more correct answers than a sober control group performing the same task, but they also arrived at solutions more quickly. The conclusion: drunk people are better at creative problem solving.

JAROSZ: You often hear of great writers, artists, and composers who claim that alcohol enhanced their creativity, or people who say their ideas are better after a few drinks. We wanted to see if we could find evidence to back that up, and though this was a small experiment, we did. We gave participants 15 questions from a creative problem-solving assessment called the Remote Associates Test, or RAT—for example, “What word relates to these three: ‘duck,’ ‘dollar,’ ‘fold’?”; the answer to which is “bill.” We found that the tipsy people solved two to three more problems than folks who stayed sober. They also submitted their answers more quickly within the one-minute-per-question time limit, which is maybe even more surprising.

HBR: So alcohol doesn’t slow us down mentally after all? It still does, but we think that creative problem solving is one area in which a key effect of drunkenness—loss of focus—is a good thing. In an exercise like the RAT, it’s important not to fixate on your first thought, and alcohol seems to help that seemingly irrelevant stuff slip in. When we asked participants how much they relied on strategic thinking versus sudden insights to solve the problems, the intoxicated people reported solving via insight on 10% more problems than their sober counterparts did.

Read more …

Apr 302018
 
 April 30, 2018  Posted by at 12:40 pm Finance Tagged with: , , , , , , , , , , ,  


Gustav Klimt The Park 1909

 

 

Dr. D feels his own golden age coming on. It’s just a bit dark gold. Nothing a good polish can’t help, I’m sure. In the end, the spirit is familiar:

A man only begins to grasp the true meaning of life when he plants a tree under whose shade he knows he will never sit.

That is literally how he finishes this:

It’s going where it’s going, as I grow plants and make the bees happy, let the trees rest in the forests, as best I’m able when devoid of any help. They will survive. We are as perennial as grass, and will diminish someday. When we do, I will have left the trees, the seeds, the order, the patterns that will feed the generations that follow, as true men, not infants, should.

It’s spring.

 

 

Dr. D:

Ilargi —
 
Would rather work on a more positive article, something about life, nature, spring, gardens; however I find that they are so complicated as to be inexpressible.  So many, from Thoreau to Sand County Almanac spend entire books and barely scratch an overview of the complexity of nature.  It’s at once so obvious and, lacking personal experience, so inexplicable.  So I haven’t done that, but it’s been chilly and till the asparagus, start the plants (too early) and wait for the leaves.
 
Maybe it’s the case that once we understand how much there is, no thoughts can be put into a 1,000 word article.  Certainly that’s to the detriment of modern thinking and persuasion.  Maybe I just always use too many words to say things and draw in sidelines that are better neglected, however interesting and connected; for all things are really equally connected in mind just as in nature, and because of our linear minds we can’t look at them at once, but only one by one.
 
John Day is correct of the gestalt, however seldom that happens to humankind.  And what is it?  Does that not mean we partake of Jung’s mass consciousness, that we are in fact telepathic, like schools of fish and flocks of birds gyring in the sky?  The nation has gone insane, truly mad, I could not describe it to you.  80% of people believe whatever they think that minute is reality.  When CNN tells them the opposite of yesterday, or the beginning of the sentence is the opposite of the ending, it causes no distress. 

It’s truly Robespierre, cultural revolution, and it doesn’t end well, for the expression of all of it is Crowley’s “Do what thou will” with Ayn Rand’s “What’s best for me is best for all” so you have a system of plundering by power, whether by force or victimhood, where the reality – actually, earnestly, incontrovertibly believed – is whatever will get me the most in this moment.  Is it easier to fake medical paperwork, not check patients, and let them die rather than get out of a chair once an hour?  We do it. 

Call them on it and they’ll deny it, believing even to themselves.  Steal from your own work, your family, banish them on Facebook if they call you on it, then expect a minute later there should be no ill will, no consequences?  Certainly.  Look around and call on public opinion for the callous, selfish, murdering behavior, and 80% of them support you, they think it’s normal and fine, punishing the 20% who still have order, consequences, cause and effect, logos. 
 

 

I have no explanation for it, nor is there an end, but I greatly fear the only cure for it is for the good people to withdraw and leave the bad people starving in a ditch, their children and dogs included, for as adults, it is nearly impossible for them to change, and impossible for any good people to trust that change.  And how are you supposed to run a justice system, a society, in a world of truly pathological, lying, self-serving sociopaths?  How even will their children not end up the same, with only 20% left to throw a lifeline?  A lifeboat cannot save the ship, you know.  It can hardly save itself.
 
I was surprised at the comments today, for this open, transparent, appalling, illogical lies are still completely internalized, completely believed at the meta level.  Trump has an open war on the CIA and Deep State – I don’t know how it could possibly be more obvious or advertised – and any common level would tell you we have been antagonizing North Korea to justify keeping country-sized bases in Japan and SoKo because the men needed to contain China wouldn’t fit in Pearl Harbor and are too far away. And yet when Trump’s team openly undercuts the CIA and peace breaks out everywhere, it’s suddenly not him. 

It’s Kim Jong actually, I read yesterday, he beat the U.S., Trump lost (when Trump also wasn’t trying anything) and…I don’t know, NoKo is going to invade us and SoKo, after they nuke Miami and the moon with the CNN missiles that can hit anywhere on earth?  After Pompeo (and allegedly Trump) met with Kim Jong in the Forbidden City? Earlier, however, he WAS completely responsible for war and the 12M dead Wolf Blitzer and Rachel Maddow longed for.  So let me translate: all bad things forever in time and space are Trump, all good things forever in time and space, not Trump.  And that’s logic now.
 
Maybe it’s inappropriate to give the Nobel to a man when it’s often a team, maybe we shouldn’t give prizes for doing a normal, decent thing and simply not killing each other, but that’s not the tradition.  Personally, I wouldn’t give it to him because in my estimation all he did was STOP the CIA from holding Kim and NoKo hostage to his own Deep State Generals.  Kim is a Swiss-raised trust fund playboy: he doesn’t want war unless forced to it.  I can’t give a medal for simply stopping a war that never should have existed, and one they even now lie about and won’t admit. 

 

But that’s not the point.  The point is, our own readers, who are very smart and should be more than up to speed, seem to completely fall for CNN, Brian Williams, and an endless list of exposed, transparent liars for 20+ years, instead of you, for example, who’s been calling it out and they read every day. My God, what will it take?  It’s disheartening.  I believe that is part of the same Jungean mass-mind they have somehow hacked and it’s a struggle for even smart people to break through.
 
So apparently Kanye, following Professor Griff and a wide number of other immediately ignored and sidelined black artists, has woken up before our own readers.  Not that Trump is great or anything, because he’s a jerk, but that they’ve arranged the same system from 100 years ago where darkie has to think and vote the way master says, or else.  That’s the worst system of slavery ever devised.  You think your color, vote your color, dress your color, watch your color, apply for jobs according to your color, and not your free thinking, your talents, your politics, your soul. 

Yet again, that’s normal: that’s not racism to tell groups how they better vote, yet it IS racism to tell them to think for themselves.  All overwhelmingly racist countries easily elect and accept Black Presidents with Muslim names, have black leaders in both parties, black billionaires, black megastars.  That’s how we know they’re racist, right?  Reality doesn’t matter, evidence doesn’t matter, logic doesn’t matter, it hasn’t mattered my whole life, it will never matter ever again.
 
It strikes me that although pretty poor, whose mascot should be the rhino, Republicans are the party AGAINST slavery, AGAINST the southern Democrats, born AGAINST the KKK, who have black cabinet members, black presidential candidates going back decades as still today. 

Doesn’t matter.  Doesn’t have the slightest effect.  Then they are so racist, so bigoted, that when any member of a subgroup, be they Kanye, Milo, Janda, Diamond and Silk should cross the aisle, they are easily welcomed as party members and people, as thinkers, and not as races, skin colors, or issues – no backlash, no contention in the party. Doesn’t matter.  Hasn’t mattered in 100 years, doesn’t matter now.  It’s truly astonishing.
 

 

Like I said, I once thought, “if only people knew”, if only there were events that would remove the mask of lies, corruption, and abuse, but there are dozens daily, and as Churchill said, they pick themselves up and brush it off, continuing with the lie, no matter how continually debunked, for example, daily for two hysterical years.
 
So what are we supposed to do when that lie — which everyone knows is a lie, but they lie and claim it’s not a lie — can get us into a war ending life on earth?  I do not know.  I say stop lying, as Trump plays along, for all the good that does us.  People tell the truth constantly: big, high-profile journalists, stars, senators…doesn’t have the slightest effect.  They’re still crazy, and the Assad-gassed-his-people-because-he-likes-to-lose-although-we-sniffed-the-backpack-and-door-handle-and-found-nothing are still credible and rational. 

Nor do I trust the gestalt.  They have a bad habit of going where they’re going, and when driven by what are essentially insane people have a bad habit of going astray, meeting their karma, with all the bad consequences therein.  I can’t stop that, but I am an American, and it’s my duty to survive this madness and this civil conflict as did my ancestors before me.  And I’m sure I will, or well enough.  Where would I go to escape this karma anyway?  Britain?  Belgium?  China?  I don’t think so. 
 
It’s going where it’s going, as I grow plants and make the bees happy, let the trees rest in the forests, as best I’m able when devoid of any help.  They will survive.  We are as perennial as grass, and will diminish someday.  When we do, I will have left the trees, the seeds, the order, the patterns that will feed the generations that follow, as true men, not infants, should.

 

 

Apr 182018
 
 April 18, 2018  Posted by at 5:21 pm Finance Tagged with: , , , , , , , , ,  


Francesco Hayez The Death of the Doge Marin Faliero 1867

 

 

Dr. D’s swift response to my essay yesterday, Every Kingdom Divided Against Itself. On the mechanisms by which empires fall. They’re always similar and familiar.

 

 

Dr. D: Wonderfully said. Since no one will report, here’s what happened to that airstrike. The one where we declare a victory and go home (or try to).

They targeted 10 sites, yet after the Pentagon said it was a perfect mission, they only reported on 4. Who were the other 6?


Duwali airbase – 4 missiles fired, 4 shot down
Dumayr airbase – 12 missiles fired, 12 shot down
Baley airbase – 18 missiles fired, 18 shot down
Shayrat airbase – 12 missiles fired, 12 shot down
Marj Ruhayyil airbase – 18 missiles fired, 18 shot down
Damascus international airport – 4 missiles fired, 4 shot down

Sounds like an amazing ad for Russian military hardware and Russian alliances, and an amazing warning to warhawks in the Pentagon to check themselves.

And hold on: wouldn’t bombing a major chemical weapons manufacturing facility lead to a cloud of nerve and/or other gas killing every civilian within 20 miles? I.e. the entire capital city? Or did they know that there was nothing there already which is why they were confident it could not lead to an incident that would be recorded as the worst chemical attack of all time? You know, chemically attacking 1.7 million Syrians to save 10 Syrians from chemical attacks?

Yet this illegal, reckless, and (intentionally?) futile attack is NOT ENOUGH for CNN, MSNBC and their ilk. Denouncing Trump for bombing Syria, they also denounced him for NOT bombing Syria. Adequately. Or fully mobilizing the entire U.S. military for a ground invasion.

Or whatever, as weasel-faced chicken hawks, they wouldn’t openly say what they wanted, only that Trump openly bombing a nation outside the U.N. without a declaration of war as they themselves demanded, was pointless and weak. Which is why they also wanted it, in side-by-side front page articles? Or like Veruca Salt they want a pony AND an oompa loompa?

 

This IS weak, and like the late Soviet Union, it IS divided, no one IS in charge, clearly, as we see: the FBI, Justice, Pentagon, CIA, all make it a point of honor to openly, proudly disobey direct orders from their boss, and with him their real employer, the American people who elected him. And which they worked tirelessly to election tamper and deny and/or remove him.

And that’s perfectly okay with everybody. Is that normal for everyone in a business, a platoon, to directly countermand all direct orders? It is these days, and not just with Trump. Once you throw off the Logos, every man does what is right in his own eyes, they are not restrained by petty law and custom, by order and precedent, for they will be as the most high.

This is as true down at Taco Bell as in Federal Court, in the Justice Department, true in police departments, schools, hospitals, and even public lavatories. Order, rules, are whatever some official wants them to be during the 5 minutes they meet you. An hour later, the rules, your punishment, even their description of reality itself is all different. Railroad one guy: it’s legal, commendable! Railroad the next guy? It’s draconian, the death penalty.

Look at someone wrong? Have an opinion? Lose your life, liberty, property, reputation and career. A Celebrity? Poor dear: no matter how many felonies, how many killed, or how often wrong, it never matters. Not just saying that, the number of police acquitted for killing unarmed citizens exceeds Parkland by leagues. And this licence is given not just to judges and investigators but by the people themselves.

 

We have an Emperor Nero or early Robespierre government. There is no logic in them. No Logos. When you expel Logos actively, joyfully, you get the anti-Logos: pure random chaos, disorder, violence, and death. No one can work with anyone, trust anyone, restrain anyone, work together, or plan. You get the Reign of Terror and the purges of the Lion’s Mouths under the Council of Ten.

This was well engineered to bring down the U.S. in a repeat of the Russian Revolution of 1918, and it’s going relatively well. When the people themselves have no order, it’s hard enough to hold the people. But when the government doesn’t either, and fights itself while lying, there’s less hope than ever.

Because while government can be reformed, it takes generations of work to re-instill the Logos, rules, law, customs, order, consequences, back into the people. Sometimes it seems nothing can purge them of these delusions of theft and power but fire.

But one way or the other, we’re in it now. The Civil War is at home. Syria is just an example of our domestic war. Remember the L.A. Times reporting the CIA-imbedded resistance openly shooting the Pentagon-imbedded Kurds? Two agencies killing each other with bullets? That went on every day before and since, politically, socially, economically, and now militarily.

The airstrike in Syria — real or fake — is that war. A war of order and law vs unrestrained will-to-power. And that battle of Logos and anti-Logos is worldwide.

 

 

Mar 212018
 
 March 21, 2018  Posted by at 2:21 pm Finance Tagged with: , , , , , , , , , , ,  


Hildegard von Bingen (1098-1179) German artist, philosopher, composer, mystic Cosmic Tree

 

All of a sudden, politicians in the EU, UK, and USA all want to talk to Mark Zuckerberg. That’s a bad enough sign all by itself. It means they all either have been asleep, complicit, or they’re not very bright. The media tries to convince us the Facebook ‘scandal’ is about Trump, Russia (yawn..) and elections. It’s not. Not even close.

If Zuckerberg ever shows up for any of these meetings with ‘worried’ politicians, he’ll come with a cabal of lawyers in tow, and they’ll put the blame on anyone but Facebook and say the company was tricked by devious parties who didn’t live up to their legal agreements.

After that, the argument won’t be whether Facebook broke any laws for allowing data breaches, but whether their data use policy itself is, and always was, illegal. Now, Facebook has been around for a few years, with their policies, and nobody ever raised their voices. Not really, that is.

And then it’ll all fizzle out, amid some additional grandstanding from all involved, face-saving galore, and more blame for Trump and Russia.

 

The new European Parliament chief Antonio Tajani said yesterday: “We’ve invited Mark Zuckerberg to the European Parliament. Facebook needs to clarify before the representatives of 500 million Europeans that personal data is not being used to manipulate democracy.”

That’s all you need to know, really. Personal data can be used to manipulate anything as long as it’s not democracy. Or at least democracy as the Brussels elite choose to define it.

First: this is not about Cambridge Analytica, it’s about Facebook. Or rather, it’s about the entire social media and search industry, as well as its connections to the intelligence community. Don’t ever again see Google or Facebook as not being part of that.

What Facebook enabled Cambridge Analytica to do, it will do ten times bigger itself. And it sells licences to do it to probably thousands of other ‘developers’. The CIA and NSA may have unlimited powers, but prior to Alphabet and Facebook, they never had the databases. They do now, and they’re using them. ‘Manipulate democracy’? What democracy?

Then: 50 million is nothing. Once the six degrees of separation giant squid gets going, there’s no stopping it. The Cambridge Analytica thing supposedly started with a few hundred thousand people who consented to having their data used for ‘academic’ purposes. From there it’s easy to get to 50 million. It’s harder to stop there than it is to go to hundreds of millions. It’s the six degrees of separation.

Facebook allegedly has over 2 billion user accounts, and their algorithms don’t stop there either. If anything, 50 million is a bit of a failure. What you should understand in this is that Cambridge Analytica are a bunch of loose cannons (yeah, yeah, those dark videos look so incriminating..) and nobody knows what they ever captured.

The real issue lies elsewhere. And we can figure it out. All we need is a few glances into the past. This first article is from June 30 2014. It contains all you read today, and more. Just a bit less Russia and Trump.

 

Facebook Reveals News Feed Experiment To Control Emotions

It already knows whether you are single or dating, the first school you went to and whether you like or loathe Justin Bieber. But now Facebook, the world’s biggest social networking site, is facing a storm of protest after it revealed it had discovered how to make users feel happier or sadder with a few computer key strokes. It has published details of a vast experiment in which it manipulated information posted on 689,000 users’ home pages and found it could make people feel more positive or negative through a process of “emotional contagion”.

In a study with academics from Cornell and the University of California, Facebook filtered users’ news feeds – the flow of comments, videos, pictures and web links posted by other people in their social network. One test reduced users’ exposure to their friends’ “positive emotional content”, resulting in fewer positive posts of their own. Another test reduced exposure to “negative emotional content” and the opposite happened.

The study concluded: “Emotions expressed by friends, via online social networks, influence our own moods, constituting, to our knowledge, the first experimental evidence for massive-scale emotional contagion via social networks.”

The question is simple, isn’t it? Do you want to provide a bunch of, well, geeks, with the ability to change how you feel, just so their employers can make -more- money off of you? That is 1984. That is thought control. And Facebook is some modern honey trap.

Lawyers, internet activists and politicians said this weekend that the mass experiment in emotional manipulation was “scandalous”, “spooky” and “disturbing”. On Sunday evening, a senior British MP called for a parliamentary investigation into how Facebook and other social networks manipulated emotional and psychological responses of users by editing information supplied to them.

Jim Sheridan, a member of the Commons media select committee, said the experiment was intrusive. “This is extraordinarily powerful stuff and if there is not already legislation on this, then there should be to protect people,” he said. “They are manipulating material from people’s personal lives and I am worried about the ability of Facebook and others to manipulate people’s thoughts in politics or other areas. If people are being thought-controlled in this kind of way there needs to be protection and they at least need to know about it.”

Um, so 4 years ago, there was a call for a parliamentary investigation in Britain and a member of the Commons media select committee proclaimed there should be legislation to protect people. Wonder how that panned out? Read the news today. Time stood still.

But there’s of course much more going on. You can claim that people should know about their thoughts being controlled, but that’s nonsense. Nobody in their right mind would, provided the arguments are honestly laid out, permit any such thing.

Moreover, it’s not just their own emotions that are being manipulated, it’s those of their friends and family too. If you are deeply unhappy, they may not see you expressing your distress; it can be easily filtered out so you appear in great spirits. Your friends feel good but someone wants you sad? No problem.

And there’s yet another aspect, one that Facebook may try to use for legal reasons: ever since the days of Edward Bernays, advertisements, and media in a broader sense, are shaped to influence what you think and feel. It sells soda, it sells cars, and it sells wars.

So yeah, people should know about all this, but the role of politicians and parliaments must also be to eradicate it altogether and forever from the societies that vote them in power. Or to tell their voters that they think it’s acceptable, and by the way, they too use deception to get more votes.

A Facebook spokeswoman said the research, published this month in the journal of the Proceedings of the National Academy of Sciences in the US, was carried out “to improve our services and to make the content people see on Facebook as relevant and engaging as possible”. She said: “A big part of this is understanding how people respond to different types of content, whether it’s positive or negative in tone, news from friends, or information from pages they follow.”

But other commentators voiced fears that the process could be used for political purposes in the runup to elections or to encourage people to stay on the site by feeding them happy thoughts and so boosting advertising revenues. In a series of Twitter posts, Clay Johnson, the co-founder of Blue State Digital, the firm that built and managed Barack Obama’s online campaign for the presidency in 2008, said: “The Facebook ‘transmission of anger’ experiment is terrifying.”

He asked: “Could the CIA incite revolution in Sudan by pressuring Facebook to promote discontent? Should that be legal? Could Mark Zuckerberg swing an election by promoting Upworthy [a website aggregating viral content] posts two weeks beforehand? Should that be legal?”

The ‘transmission of anger’ experiment. This is the world you live in.

Well, no, none of it should be legal. And none of it would be if people knew what was going on.

It was claimed that Facebook may have breached ethical and legal guidelines by not informing its users they were being manipulated in the experiment, which was carried out in 2012. The study said altering the news feeds was “consistent with Facebook’s data use policy, to which all users agree prior to creating an account on Facebook, constituting informed consent for this research”.

But Susan Fiske, the Princeton academic who edited the study, said she was concerned. “People are supposed to be told they are going to be participants in research and then agree to it and have the option not to agree to it without penalty.”

James Grimmelmann, professor of law at Maryland University, said Facebook had failed to gain “informed consent” as defined by the US federal policy for the protection of human subjects, which demands explanation of the purposes of the research and the expected duration of the subject’s participation, a description of any reasonably foreseeable risks and a statement that participation is voluntary. “This study is a scandal because it brought Facebook’s troubling practices into a realm – academia – where we still have standards of treating people with dignity and serving the common good,” he said on his blog.

Ah, academia, you unblemished child. We never knew you. Incidentally, what appears to be creeping through between the lines here is that Facebook’s data use policy was prepared from the start, 14+ years ago, for exactly these kinds of ‘experiments’. Which gives a whole new dimension to the discussion today.

It is not new for internet firms to use algorithms to select content to show to users and Jacob Silverman, author of Terms of Service: Social Media, Surveillance, and the Price of Constant Connection, told Wire magazine on Sunday the internet was already “a vast collection of market research studies; we’re the subjects”.

“What’s disturbing about how Facebook went about this, though, is that they essentially manipulated the sentiments of hundreds of thousands of users without asking permission,” he said. “Facebook cares most about two things: engagement and advertising.

If Facebook, say, decides that filtering out negative posts helps keep people happy and clicking, there’s little reason to think that they won’t do just that. As long as the platform remains such an important gatekeeper – and their algorithms utterly opaque – we should be wary about the amount of power and trust we delegate to it.”

Robert Blackie, director of digital at Ogilvy One marketing agency, said the way internet companies filtered information they showed users was fundamental to their business models, which made them reluctant to be open about it.

“To guarantee continued public acceptance they will have to discuss this more openly in the future,” he said. “There will have to be either independent reviewers of what they do or government regulation. If they don’t get the value exchange right then people will be reluctant to use their services, which is potentially a big business problem.”

Feel a bit more awake now? Remember, that was a 2012 study. Let’s move on to 2016, when Shoshana Zuboff penned the following for German paper Franfurter Allgemeine. Just in case you thought it was all about Facebook. This is a bit more abstract, but worth it, in all its length (which I don’t have space for).

 

The Secrets of Surveillance Capitalism

[..] The game is no longer about sending you a mail order catalogue or even about targeting online advertising. The game is selling access to the real-time flow of your daily life –your reality—in order to directly influence and modify your behavior for profit. This is the gateway to a new universe of monetization opportunities: restaurants who want to be your destination. Service vendors who want to fix your brake pads.

Shops who will lure you like the fabled Sirens. The “various people” are anyone, and everyone who wants a piece of your behavior for profit. Small wonder, then, that Google recently announced that its maps will not only provide the route you search but will also suggest a destination.

This is just one peephole, in one corner, of one industry, and the peepholes are multiplying like cockroaches. Among the many interviews I’ve conducted over the past three years, the Chief Data Scientist of a much-admired Silicon Valley company that develops applications to improve students’ learning told me:

“The goal of everything we do is to change people’s actual behavior at scale. When people use our app, we can capture their behaviors, identify good and bad behaviors, and develop ways to reward the good and punish the bad.

[..] There was a time when we laid responsibility for the assault on behavioral data at the door of the state and its security agencies. Later, we also blamed the cunning practices of a handful of banks, data brokers, and Internet companies. Some attribute the assault to an inevitable “age of big data,” as if it were possible to conceive of data born pure and blameless, data suspended in some celestial place where facts sublimate into truth.

I’ve come to a different conclusion: The assault we face is driven in large measure by the exceptional appetites of a wholly new genus of capitalism, a systemic coherent new logic of accumulation that I call surveillance capitalism. Capitalism has been hijacked by a lucrative surveillance project that subverts the “normal” evolutionary mechanisms associated with its historical success and corrupts the unity of supply and demand that has for centuries, however imperfectly, tethered capitalism to the genuine needs of its populations and societies, thus enabling the fruitful expansion of market democracy.

[..] the application of machine learning, artificial intelligence, and data science for continuous algorithmic improvement constitutes an immensely expensive, sophisticated, and exclusive twenty-first century “means of production.” [..] the new manufacturing process converts behavioral surplus into prediction products designed to predict behavior now and soon.

[..] these prediction products are sold into a new kind of meta-market that trades exclusively in future behavior. The better (more predictive) the product, the lower the risks for buyers, and the greater the volume of sales. Surveillance capitalism’s profits derive primarily, if not entirely, from such markets for future behavior.

And then we get to today. For more examples of the same, and for confirmation that even though all of this stuff was known -let alone knowable- years ago, nothing has changed.

 

Ex-Facebook Insider Says Covert Data Harvesting Was Routine

Hundreds of millions of Facebook users are likely to have had their private information harvested by companies that exploited the same terms as the firm that collected data and passed it on to Cambridge Analytica, according to a new whistleblower.

Sandy Parakilas, the platform operations manager at Facebook responsible for policing data breaches by third-party software developers between 2011 and 2012, told the Guardian he warned senior executives at the company that its lax approach to data protection risked a major breach. “My concerns were that all of the data that left Facebook servers to developers could not be monitored by Facebook, so we had no idea what developers were doing with the data,” he said.

[..] That feature, called friends permission, was a boon to outside software developers who, from 2007 onwards, were given permission by Facebook to build quizzes and games – like the widely popular FarmVille – that were hosted on the platform. The apps proliferated on Facebook in the years leading up to the company’s 2012 initial public offering, an era when most users were still accessing the platform via laptops and computers rather than smartphones.

Facebook took a 30% cut of payments made through apps, but in return enabled their creators to have access to Facebook user data. Parakilas does not know how many companies sought friends permission data before such access was terminated around mid-2014. However, he said he believes tens or maybe even hundreds of thousands of developers may have done so. Parakilas estimates that “a majority of Facebook users” could have had their data harvested by app developers without their knowledge.

[..] During the time he was at Facebook, Parakilas said the company was keen to encourage more developers to build apps for its platform and “one of the main ways to get developers interested in building apps was through offering them access to this data”. Shortly after arriving at the company’s Silicon Valley headquarters he was told that any decision to ban an app required the personal approval of the chief executive, Mark Zuckerberg…

OK, to summarize: Mark Zuckerberg will be fine, apart from some stock losses. Facebook’s data use policies may not conform to every single piece of legislation in every country Facebook operates in, but they’ve been there since 2004. So lawmakers are as culpable as the company is.

There’ll be big words, lots of them. And there may be people leaving Facebook. But the platform is addictive, and 2 billion addicts is a very large target group. Some other company may develop a competitor and promise ‘better’ policies and conditions, but the big money is in the very thing discussed today: manipulating people’s data, and thereby manipulating their behavior.

Perhaps if news media and advertizers were so inclined, they’d explain to their readers and viewers exactly that, but in the end they A) all do it to some extent, and B) are all connected to Facebook and Google to some extent.

But the main driving force is and will remain the intelligence agencies, who have come to depend on ‘social media’ for the one thing they themselves were incapable of providing, but saw Alphabet and Facebook incite gullible people themselves to provide: an artificial intelligence driven database that knows more about you than you know yourself.

That the intelligence community today is powered by artificial intelligence is pretty out there to start with. That AI would give it the means to predict your future behavior, and manipulate you into that behavior seemingly at will, is something that warrants reflection.

George Orwell could not have foreseen this.

 

 

Feb 192018
 
 February 19, 2018  Posted by at 10:56 am Finance Tagged with: , , , , , , , , , ,  


Frank Larson Broadway Billboard Seven Year Itch 1955

 

Global Dividends Hit Record Of $1.25 Trillion In 2017, More To Come (R.)
Jittery US Bond Market Braces For Supply Wave (R.)
How Did America Go Bankrupt? Slowly At First, Then All At Once (CH)
London’s Housing Boom Is Over, Rightmove Says (BBG)
Average Price Of Newly Marketed UK Home Rises Above £300,000 Again (G.)
Ex-CIA Director Thinks US Hypocrisy About Election Meddling Is Hilarious (CJ)
German Carmakers In A Spin Ahead Of Diesel Ban Ruling (R.)
Sweden Is Getting Worried About Its Cashless Society (BBG)
Europe Is A Collection Of Filter Bubbles (BBG)

 

 

As is the case with buybacks, this is all money that execs decide NOT to invest in a company (productivity, modernization, maintenance), but in its stock value.

Global Dividends Hit Record Of $1.25 Trillion In 2017, More To Come (R.)

Global dividends rose 7.7% to an all-time high of $1.25 trillion (1 trillion euros) last year boosted by a buoyant world economy and rising corporate confidence, Janus Henderson said on Monday, predicting another record year ahead. The surge – the strongest since 2014 – was driven by increases in every region and almost every industry with record showings in 11 countries including the United States, Japan, Switzerland, Hong Kong, Taiwan and the Netherlands, the investment manager added. For 2018 Janus Henderson expects dividends to keep the same 7.7% growth rate to reach around $1.35 trillion, as corporate and economic growth remains strong even in more volatile financial markets. “Companies are seeing rising profits and healthy cash flows, and that’s enabling them to fund generous dividends.

The record payout last year was almost three-quarters higher than in 2009, and there is more to come,” Ben Lofthouse, Director of Global Equity Income at Janus Henderson, said. “The next few months are set fair, and we expect global dividends to break new records in 2018.” Adjusting for movements in exchange rates, special one-off dividends and other factors, global dividends rose 6.8% last year and are expected to rise another 6.1% in 2018. Janus said 2017’s dividend growth showed less regional divergence than in previous years, reflecting the broadly based global economic recovery, though Europe lagged behind. European dividends rose just 1.9% to $227 billion, weighed down by cuts from a handful of large companies in France and Spain, lower special dividends and a weak euro during the second quarter, when most dividends are paid, it said.

Read more …

How can more debt not be good?

Jittery US Bond Market Braces For Supply Wave (R.)

Bond investors, who have been on edge over signs of growing inflation and a possibly more aggressive Federal Reserve, will have their work cut out for them as the U.S. government seeks to sell $258 billion worth of debt this coming week. The Treasury Department began ramping up its debt issuance earlier this month to fund the expected growth in borrowing tied to the biggest tax overhaul in 30 years and a two-year federal spending package. Last year’s tax reform is expected to add as much as $1.5 trillion to the federal debt load, while the budget agreement would increase government spending by almost $300 billion over the next two years. Analysts worry the combination of a rising budget deficit, faster inflation and more Fed rate increases have ratcheted up the risk of owning Treasuries. Those concerns pushed benchmark 10-year Treasury yields up to 2.944%, a four-year peak last week.

Treasury bill and two-year yields have reached their highest level in more than nine years. The five-year Treasury yield is hovering at its highest levels in nearly eight years, while seven-year yield climbed to levels not seen since April 2011. The increase in U.S. yields may entice investors seeking steady income in the wake of the rollercoaster sessions on Wall Street and other stock markets this month, analysts said. [..] The heavy Treasury supply will kick off on Tuesday with $151 billion worth of bills including record amounts of three-month and six-month T-bills. The rest of the debt sales will spread over a holiday-shortened week with $28 billion of two-year fixed rate notes on Tuesday; $35 billion in five-year debt on Wednesday and $29 billion in seven-year notes on Thursday. The Treasury Department also plans to add $15 billion to an older two-year floating-rate issue.

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Everything is debt. Imagine what would happen if it wasn’t there. Or soon won’t be.

How Did America Go Bankrupt? Slowly At First, Then All At Once (CH)

Clearly, debt has surged since 2000 and particularly since 2008 versus decelerating net full time jobs growth. The number of full time employees is economically critical as, generally speaking, only these jobs offer the means to be a home buyer or build savings and wealth in a consumer driven economy. Part time employment generally offers only subsistence level earnings. But if we look at the change over those periods highlighted, we get a clear picture. Full time jobs are being added at a rapidly declining rate while federal debt is surging in the absence of the growth of full time employees.

And if we look at the federal debt added per full time job added (chart below)…broken arrow…broken arrow!!! That is $1.92 million dollars in new federal debt per net new full time employee since 2008. Compare that to the $30 thousand per net new full time employee from ’70 to ’80…or $140 thousand from ’80 to ’90…and nearly quadruples the $460 thousand per from ’00 to ’08. Despite a far larger total population and after ten years of “recovery” since ’08, this is likely as good as it gets. We are likely at or very near the top of this economic cycle. This pattern is likely to carry forward over the next decade and economic cycle…likely with disastrous results.

[..] US population growth has been decelerating since 1790 and debt to GDP rising (chart below). Originally, the combination of a relatively small population, high immigration, and high birth rates meant annual population growth in excess of 3% and relatively low debt to GDP. Over time, as the population grew, immigration slowed, and birth rates collapsed; US population growth tumbled. Since 1950 total annual population growth (black line in chart below) has decelerated almost 75% (from 2% to 0.6%) but more critically the annual population growth among the under 65 year old population has essentially ceased (as the yellow line in the chart shows) and more debt has been the resounding “solution”. Massive interest rate cuts to incent debt creation have been substituted for the decelerating organic growth.

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About time.

London’s Housing Boom Is Over, Rightmove Says (BBG)

London’s property market has moved out of its boom phase and home sellers need to be more realistic about their price demands, according to Rightmove. The February report from the home-listing website shows that asking prices were down 1% from a year earlier, a sixth consecutive fall. They rose 4.4% on the month, reflecting the usual jump at the start of the spring season. While multiple reports point to a cooling in London housing, the damage is being limited by cautious sellers, who aren’t flooding the market in a panic to dump property. That means the long-running supply-demand imbalance in the city is providing some support to prices. “End-of-the-boom prices normally readjust more quickly if there is an over supply,” Miles Shipside, Rightmove director, said in the report. However, “some would-be sellers are holding back, preventing a glut of competition from forcing prices downward,” he said.

The capital’s housing market was the worst performing in the U.K. in 2017 and there’s little to suggest any upturn is in store. Brexit uncertainty has damped demand, while years of rampant inflation has pushed ownership out of reach for many. The mean asking price in London this month was almost 630,000 pounds ($885,000), more than 20 times average U.K. earnings. For those who need a fast sale, Shipside’s advice is to “sacrifice some of the substantial price gains of the last few years.” The average time to sell a property in London is now 83 days, up from 73 days a year ago. Nationally, asking prices increased 0.8% in February from January, though that was below the 10-year average for the time of year. The average price of 300,000 pounds is up 1.5% year-on-year. That compares with gains of about 6% seen less than two years ago.

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But wait, this quotes Rightmove as well…

Average Price Of Newly Marketed UK Home Rises Above £300,000 Again (G.)

The average price of a UK property coming on to the market has risen by more than £2,400 in a month to just over £300,000 amid evidence of “record” levels of house-hunting activity, according to Rightmove. The website, which tracks 90% of the UK property market, said the national average asking price for a home had increased by 0.8% during the past month, following the 0.7% rise it reported in mid-January. However, some sellers may be over-pricing their properties: the average time to sell has risen once again and is now 72 days, compared with 67 days a month ago and 55 during the summer of 2017. In London, the average has climbed to 83 days. Rightmove said that while it was the norm for new sellers’ asking prices to be buoyant at the start of a new year, “this first complete month in 2018 is seeing more pricing optimism than the comparable period in 2017”.

In general, however, sellers were not being over-ambitious or setting too high a price, it added. The website, which claims to display a stock of more than one million properties to buy or rent, said the average asking price now stood at £300,001, compared with £297,587 a month ago. It described January as its “busiest month ever”, with a record 141m website visits. In all the UK regions it tracks, the typical price of a newly-marketed property rose during the past month, with the exception of south-west England, where the figure slipped back slightly. Scotland saw the biggest monthly increase, at 5.1%, while the north-east and Wales managed 3.6% and 3.5%. However, on a national basis, the annual rate of price growth “remains subdued” at 1.5%, said the website.

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Isn’t it?

Ex-CIA Director Thinks US Hypocrisy About Election Meddling Is Hilarious (CJ)

Take off the terrorist’s mask, and it’s the CIA. Take off the revolutionary’s mask, and it’s the CIA. Take off the Hollywood producer’s mask, and it’s the CIA. Take off the billionaire tech plutocrat’s mask, and it’s the CIA. Take off the news man’s mask, and guess what? It’s the motherfucking CIA. CIA influence is everywhere. Anywhere anything is happening which could potentially interfere with the interests of America’s unelected power establishment, whether inside the US or outside, the depraved, lying, torturing, propagandizing, drug trafficking, coup-staging, warmongering CIA has its fingers in it. Which is why its former director made a cutesy wisecrack and burst out laughing when asked if the US is currently interfering in other democracies.

Fox’s Laura Ingraham unsurprisingly introduced former CIA Director James Woolsey as “an old friend” in a recent interview about Special Prosecutor Robert Mueller’s indictment of 13 alleged members of a Russian troll farm, in which Woolsey unsurprisingly talked about how dangerous Russian “disinformation” is and Ingraham unsurprisingly said that everyone should really be afraid of China. What was surprising, though, was what happened at the end of the interview. “Have we ever tried to meddle in other countries’ elections?” Ingraham asked in response to Woolsey’s Russia remarks. “Oh, probably,” Woolsey said with a grin. “But it was for the good of the system in order to avoid the communists from taking over. For example, in Europe, in ’47, ’48, ’49, the Greeks and the Italians we CIA-”

“We don’t do that anymore though?” Ingraham interrupted. “We don’t mess around in other people’s elections, Jim?” Woolsey smiled and said said “Well…”, followed by a joking incoherent mumble, adding, “Only for a very good cause.” And then they both laughed. They laughed about this. They thought it was funny and cute. They thought it was funny and cute that the very allegation being used to manufacture support for world-threatening new cold war escalations against a nuclear superpower was something they both knew the United States does constantly, usually through Woolsey’s own CIA. The US government’s own data shows that it has deliberately meddled in the elections of 81 foreign governments between 1946 and 2000, including Russia in the nineties. That isn’t even counting the coups and regime changes it facilitated, including right here in my home Australia in the seventies.

The US meddles constantly in other democracies, not “for a good cause” as Woolsey claims, but to advance the agendas of the loosely allied plutocrats, intelligence and defense agencies which comprise America’s permanent government. It does this not to improve or protect the lives of ordinary Americans, but to make the rich richer and the powerful more powerful, usually at the expense of the money, resources, homes, governments, livelihoods and lives of people in other countries. It does this with impunity and without hesitation.

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Carmakers rule the country.

German Carmakers In A Spin Ahead Of Diesel Ban Ruling (R.)

A court will decide on Thursday whether German cities can ban heavily polluting cars, potentially wiping hundreds of millions of euros off the value of diesel cars on the country’s roads. Environmental group DUH has sued Stuttgart in Germany’s carmaking heartland, and Duesseldorf over levels of particulate matter exceeding EU limits after Volkswagen’s 2015 admission to cheating diesel exhaust tests. The scandal led politicians across the world to scrutinize diesel emissions, which contain the matter and nitrogen oxide (NOx) and are known to cause respiratory disease. There are around 15 million diesel vehicles on German streets and environmental groups say levels of particulates exceed the EU threshold in at least 90 German towns and cities.

Local courts ordered them to bar diesel cars which did not conform to the latest standards on days when pollution is heavy, startling German carmakers because an outright ban could trigger a fall in vehicle resale prices, and a rise in the cost of leasing contracts, which are priced on assumed residual values. The German states concerned, where the carmakers and their suppliers have a strong influence, appealed against the decisions, leaving Germany’s federal administrative court – the court of last resort for such matters – to rule on whether such bans can legally be imposed at local level.

“The key question is whether bans can already be considered to be legal instruments,” said Remo Klinger, a lawyer for DUH. “It’s a completely open question of law.” Paris, Madrid, Mexico City and Athens have said they plan to ban diesel vehicles from city centers by 2025, while the mayor of Copenhagen wants to ban new diesel cars from entering the city as soon as next year. France and Britain will ban new petrol and diesel cars by 2040 in a shift to electric vehicles.

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Big Brother is not worried.

Sweden Is Getting Worried About Its Cashless Society (BBG)

‘“No cash accepted” signs are becoming an increasingly common sight in shops and eateries across Sweden as payments go digital and mobile. But the pace at which cash is vanishing has authorities worried. A broad review of central bank legislation that’s underway is now taking a special look at the situation, with an interim report due as early as the summer. “If this development with cash disappearing happens too fast, it can be difficult to maintain the infrastructure” for handling cash, said Mats Dillen, the head of the parliamentary review. He declined to get into more details on what types of proposals could be included in the report. Sweden is widely regarded as the most cashless society on the planet. Most of the country’s bank branches have stopped handling cash; many shops, museums and restaurants now only accept plastic or mobile payments.

But there’s a downside, since many people, in particular the elderly, don’t have access to the digital society. “One may get into a negative spiral which can threaten the cash infrastructure,” Dillen said. “It’s those types of issues we are looking more closely at.” Last year, the amount of cash in circulation dropped to the lowest level since 1990 and is more than 40 percent below its 2007 peak. The declines in 2016 and 2017 were the biggest on record. An annual survey by Insight Intelligence released last month found only 25 percent of Swedes last year paid in cash at least once a week, down from 63 percent just four years ago. A full 36 percent never use cash, or just pay with it once or twice a year.

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There is no such thing as one Europe. And the more the EU promotes the narrative, the more that will become obvious.

Europe Is A Collection Of Filter Bubbles (BBG)

The EU can act in unison at times – for example, on Russia sanctions or, at least so far, on Brexit. But as French President Emmanuel Macron and German Chancellor Angela Merkel try for a closer union in the next few years, they will need to be mindful of the fact that there is no single narrative among the publics in different European countries on matters of economic importance. A recent paper for Bruegel, a Brussels-based think tank, vividly shows this by analyzing coverage of Europe’s recent financial crisis by four important centrist newspapers: Germany’s Sueddeutsche Zeitung, France’s Le Monde, Italy’s La Stampa and Spain’s El Pais. The total data set encompassed 51,714 news stories. The researchers fed them to a content analysis algorithm and then analyzed the results to construct generalized narratives. Their focus was on how blame for the crisis was attributed.

They found that only El Pais consistently attributed blame to Spain itself for its financial troubles during the euro crisis. “In Spain, the connection between the global financial crisis, the local housing bubble and the mismanagement of a previous period of impressive growth was more visible,” Porcaro explained to me. As one might expect, Sueddeutsche Zeitung blames the crisis on a departure from the traditional German social market economic model. Everyone except Germany seems to have contributed, according to the Munich paper — from greedy financial market players to financially imprudent Greeks to the ECB with its loose monetary policy. Le Monde, too, blamed the banks and speculators, but also German intransigence in handling the indebted southern Europeans.

And La Stampa focused on Italy’s role as a victim of circumstance, namely globalization and German-imposed austerity. Banks and financiers didn’t get much attention as culprits from the Italian newspaper, but the Italian political system and government did get some blame, as in Spain. Le Monde and La Stampa, according to the Bruegel paper, both “embrace a sense of desperation that goes far beyond purely economic considerations but calls into question the entire political system and social fabric.” It’s as if the euro area’s four biggest economies didn’t share a reality. The four quality dailies resemble the blind men in the Indian parable, feeling different parts of an elephant’s body, declaring the whole animal should look like a tree or a snake, then coming to blows when they can’t agree.

Read more …

Jan 102018
 
 January 10, 2018  Posted by at 9:19 pm Finance Tagged with: , , , , , , , , , ,  


Giorgione The Tempest 1508

 

Happy belated new year. Belatedly. Thought I’d sit out a few days, since there wasn’t much news to be expected. And it did pan out that way, other than Trump bogarting the limelight; but then, that isn’t really news either. Anything he says or does triggers the expansive anti-Donald echo chamber into a daily frenzy. And frankly, guys, it’s not just boring, but you’re also continuously providing him with free publicity. At least make him work for some of it.

Then, however, the big microprocessor (chip) security ‘flaw’ was exposed. And that’s sort of interesting, because it concerns the basic architecture of basically every microchip produced in the past 20 years, even well before smartphones. Now, the first thing you have to realize is that we’re not actually talking about a flaw here, but about a feature. We use that line a lot in a half-jokingly version, but in this case it’s very much true. As Bloomberg succinctly put it:

All modern microprocessors, including those that run smartphones, are built to essentially guess what functions they’re likely to be asked to run next. By queuing up possible executions in advance, they’re able to crunch data and run software much faster. The problem in this case is that this predictive loading of instructions allows access to data that’s normally cordoned off securely..

And:

Spectre fools the processor into running speculative operations – ones it wouldn’t normally perform – and then uses information about how long the hardware takes to retrieve the data to infer the details of that information. Meltdown exposes data directly by undermining the way information in different applications is kept separate by what’s known as a kernel, the key software at the core of every computer.

As I said: feature, not flaw (or two really, Spectre and Meltdown). And that makes one wonder: fixing a flaw is one thing, but how do you fix a feature? Several quotes claim that software patches would mean the performance speed of affected chips (that would be all of them) would go down by 25-30% or so. Which is bad enough, but the problem is not -limited to- software. And patching up hardware/firmware issues with software can’t be easy, if even viable.

That would make one suspect that even if a software patch can suppress this feature, as long as the architecture doesn’t change, it can still function as a backdoor. Apple may say there are no known exploits of it, but would they tell if for instance intelligence services used it? Or other parties that cannot be labeled ‘hackers’?

 

All that ties in seemingly seamlessly with Apple shareholders expressing their worries about the effect of their investments. Though you might want to wonder if their worries would be the same if Apple shares plummeted tomorrow.

 

Two Major Apple Shareholders Push for Study of iPhone Addiction in Children

..activist investor Jana Partners and the California State Teachers’ Retirement System urged Apple to create ways for parents to restrict children’s access to their mobile phones. They also want the company to study the effects of heavy usage on mental health.

There are a few things off with this. First, there’s the risk of these kids’ iPhones being hacked through the flaw, feature, backdoor mentioned above. That’s potentially a lot worse for them. Then, there’s the obvious fact that parents can simply take their children’s phones away, there’s no better way to restrict access. Why should that be Apple’s responsibility?

But most of all, children are addicted to their phones because of the content, and Apple, though they would wish it were different, are not the major content providers. That role is played by Alphabet/Google/YouTube and Facebook/Instagram, and to a lesser extent Snapchat and Twitter. And they are a much bigger threat than Apple is.

 

There has been a lot of talk about hate speech, fake news and election interference over the past year and change -and it won’t stop anytime soon, because it’s political gold dust. Germany, France, the UK, US and a whole slew of smaller nations have all tried to implicate Russia in all of these issues, and for good measure opposition parties to incumbent governments have been fingered too.

There are perhaps very obvious examples of all three topics, but the issue as a whole is far from clear. In Germany, Twitter accounts of the Alternative für Deutschland party have been blocked, but given that they now have seats in parliament, that is a tricky problem. Likewise, much of what the US MSM has been writing about Trump and his organization has proven unsubstantiated, and could therefore be labeled fake news. It isn’t to date, other than by the president himself, but who draws the line where?

The US election interference narrative is shaky, since it largely appears to rely on $100k or so in Facebook ads bought by some mysterious party, ads that are supposed to have been much more effective than many billions of dollars in campaign funding. The kind of thing that makes you think: if the Russians are so much better at this than we are, we might as well hand it all over to them right now.

The main problem with the election interference stories is that none of it has ever been proven. Not even the $100k+ in Facebook ads; they might just as well have originated in Langley and we only have Langley’s word for any alternative claims. Overall, defining what is hate speech and what is fake news seems to come down far too much to opinions rather than facts, and that has us sliding down a supremely slippery slope, not exactly a place to build solid policy on.

So how and why can Facebook and Google be trusted to provide objective assessments on what is fake news and hate speech vs what is not? That is what they are being tasked with at present. They hires tens of thousands of people to do that ‘job’. But what are these people’s qualifications? How do these companies make sure political bias is kept out of the process? Do they even want to keep it out, or do Zuckerberg, Brin, Schmidt want to confirm their own bias?

It’s hard to see how the decision making process, fake vs real news, hate speech, political meddling, will not inevitably become one guided and goaded by intelligence services, because they are the ones who claim to have both the knowledge and the evidence upon which these decisions must be based. But US intelligence is not politically neutral, and they don’t share the sources of their ‘evidence’.

 

 

Still, none of that is the main problem here either. Though we’re getting closer.

Over the holidays, I saw a movie in which there was a teachers’ Christmas party at some highschool. All the teachers were bored and sat or stood in silence looking at nothing. And I realized that kind of scene no longer exists today. Though the movie was just 10-15 years old, there have been some profound changes. At a party like that, or at a busstop, in a bus or train, a waiting room or even a family dinner, everyone is now glued to their smartphone. Even people walking down the street are. And those driving down the street.

What all these people seem to do most is look at their Facebook/Instagram/Snapchat etc. accounts. And apart from the profound changes to human interaction in public spaces, there are other things that deserve attention. Like for instance that while you think you’re having private conversations with your friends and family, there’s nothing private about it. Everything you tell your ‘friends’ de facto becomes property of the owners of the app you’re sharing it on.

When your friends read what you just wrote, they see not only that but also ads that the app displays alongside it. That means Facebook makes money from your friends’ attention for your words. Since Facebook reached 2 billion active users in 2017, that adds up. And they don’t have to do anything for that, other than keep the channels open.

But that is not the worst part. Facebook not only makes money off your contact with family and friends, something most people would probably find comparatively innocent, it also ‘spies’ on you. At the very least, its algorithms actively scour its databases to suggest possible additional friends, and/or people you might know. That can lead to unexpected and potentially undesirable results:

 

Facebook Figured Out My Family Secrets, And It Won’t Tell Me How

Rebecca Porter and I were strangers, as far as I knew. Facebook, however, thought we might be connected. Her name popped up this winter on my list of “People You May Know”, the social network’s roster of potential new online friends for me. The People You May Know feature is notorious for its uncanny ability to recognise who you associate with in real life. It has mystified and disconcerted Facebook users by showing them an old boss, a one-night-stand, or someone they just ran into on the street.

These friend suggestions go far beyond mundane linking of schoolmates or colleagues. Over the years, I’d been told many weird stories about them, such as when a psychiatrist told me that her patients were being recommended to one another, indirectly outing their medical issues.

What makes the results so unsettling is the range of data sources – location information, activity on other apps, facial recognition on photographs – that Facebook has at its disposal to cross-check its users against one another [..] . People are generally aware that Facebook is keeping tabs on who they are and how they use the network, but the depth and persistence of that monitoring is hard to grasp. And People You May Know, or “PYMK” in the company’s internal shorthand, is a black box.

To try to get a look into that black box – and the unknown and apparently aggressive data collection that feeds it – I began downloading and saving the list of people Facebook recommended to me, to see who came up, and what patterns might emerge. On any given day, it tended to recommend about 160 people, some of them over and over again; over the course of the winter, it suggested more than 1400 different people to me. About 200, or 15% of them, were, in fact, people I knew, but the rest appeared to be strangers.

And then there was Rebecca Porter. She showed up on the list after about a month: An older woman, living in Ohio, with whom I had no Facebook friends in common. I did not recognise her, but her last name was familiar. My biological grandfather is a man I’ve never met, with the last name Porter, who abandoned my father when he was a baby. My father was adopted by a man whose last name was Hill, and he didn’t find out about his biological father until adulthood.

The gist of the tale is clear: Someone being introduced by Facebook to someone (s)he never knew, and may not have wanted to know, or know about him/her.

But we’re still skirting the real problems. Though by now you may want to give it all another thought. The real problem is that by giving out the information on Facebook, even if it all seems completely harmless and innocent to you, you have become Big Brother.

That may sound over the top, and I wouldn’t want to go into popular innuendo that the NSA has started either Facebook or Bitcoin, but it’s obvious that when Google’s and Facebook’s algorithms can dig up so much information on people and the links between them, the intelligence community wants a piece of that. Google/Alphabet’s CEO (he’s leaving that post soon) Eric Schmidt is the head of DOD’s Defense Innovation Board for a reason, and he has been close to the Democratic Party core for years.

It all fits too well to be discarded. It’s inevitable that the NSA, the CIA have recognized the potential of Big Tech for spying on Americans -and everyone else- for a while now. What you write on Facebook may seem harmless, but the algorithms can do more with it than -quite literally- is ‘dreamt of in your philosophy’.

And so Pirate Bay co-founder Peter Sunde is accurate in recognizing the symptoms, but not in diagnosing the underlying affliction. Mark Zuckerberg is not the dictator, and Trump is not in control of the data. They are mere conduits, and the buck stops elsewhere. We’ve centralized all our data to Big Brother.

 

We’ve Centralized All Of Our Data To A Guy Called Mark Zuckerberg

“Everything has gone wrong. That’s the thing, it’s not about what will happen in the future it’s about what’s going on right now. We’ve centralized all of our data to a guy called Mark Zuckerberg, who’s basically the biggest dictator in the world as he wasn’t elected by anyone. Trump is basically in control over this data that Zuckerberg has, so I think we’re already there. Everything that could go wrong has gone wrong and I don’t think there’s a way for us to stop it.”

One of the most important things to realize is that the problem isn’t a technological one. “The internet was made to be decentralized,” says Sunde, “but we keep centralizing everything on top of the internet.” To support this, Sunde points out that in the last 10 years, almost every up-and-coming tech company or website has been bought by the big five: Amazon, Google, Apple, Microsoft and Facebook. The ones that manage to escape the reach of the giants, often end up adding to the centralization.

We don’t create things anymore, instead we just have virtual things. Uber, Alibaba and Airbnb, for example, do they have products? No. We went from this product-based model, to virtual product, to virtually no product what so ever. This is the centralization process going on. Although we should be aware that the current effects of centralization, we shouldn’t overlook that it’s only going to get worse. There are a lot of upcoming tech-based services that are at risk of becoming centralized, which could have a huge impact on our daily lives.

[..] Feeling a bit optimistic, I asked Sunde whether we could still fight for decentralization and bring the power back to the people. His answer was simple. “No. We lost this fight a long time ago. The only way we can do any difference is by limiting the powers of these companies – by governments stepping in – but unfortunately the EU or the US don’t seem to have any interest in doing this.”

The model is absolutely perfect, and it’s not even one that was built on purpose. When Facebook started, Zuckerberg et al were not thinking about 2 billion active users. Nor were they aiming for algorithms that could so pervasively document people’s lives and their connections to others across space and time, or that these people themselves would provide them with the information that can be used to build files on them that can at some point in their lives be used against them, if that is deemed necessary.

And this is just early innings. This is before artificial intelligence and virtual -and/or augmented- reality have really taken off. But when AI is truly unleashed upon the internet, everyone’s seemingly innocent everyday stories as told to family and friends will be a treasure trove when it comes to building the pictures of their lives that are useful to governments and their intelligence agencies.

These platforms are labeled social media, and we might want to think about that label. It’s nice to be able to communicate with people who are not where you find yourself at a given point in time, but there’s a price to pay for that; actually, multiple prices. We’ve likely all found ourselves in situations by now where people act less, not more sociable precisely because of social media; they’re just communicating with their phones, not their immediate surroundings.

Somehow at times that feels a whole new -big- step for mankind: you’re together but you’re not. We are social animals but we attempt to transfer our social lives across space and time to moments and places we’re not at. And we have a gadget that does that for us. That is a puzzling development, and from where I’m sitting a worrying one as well. Somewhere along the same lines as being able to watch ever better photography from ever more remote nature scenes as that nature is being destroyed.

 

Still, few of us would have imagined that when 1984 finally happened, we would ourselves turn out to be Big Brother, but that’s what we are. Or if you want you can insist we’re merely feeding the monster. Same difference. But maybe that too is just a small step for man and a giant leap for mankind. Just like the never before seen quality footage of animals about to go extinct.

Who is anyone of us to judge any of it? It’s confusing, it throws us off everything we were taught is normal and lasting, and that’s only when we pay attention, and it all happens at lightning speed.

One thing we can say though: none of this is innocent. Whatever it is mankind is leaping into, we left innocence behind for good.

 

 

Nov 112017
 
 November 11, 2017  Posted by at 9:15 pm Finance Tagged with: , , , , , , , , ,  


Jean-Léon Gérôme Truth Coming Out of Her Well to Shame Mankind 1896

 

An entire library of articles about Big Tech is coming out these days, and I find that much of it is written so well, and the ideas in them so well expressed, that I have little to add. Except, I think I may have the solution to the problems many people see. But I also have a concern that I don’t see addressed, and that may well prevent that solution from being adopted. If so, we’re very far away from any solution at all. And that’s seriously bad news.

Let’s start with a general -even ‘light’- critique of social media by Claire Wardle and Hossein Derakhshan for the Guardian:

 

How Did The News Go ‘Fake’? When The Media Went Social

Social media force us to live our lives in public, positioned centre-stage in our very own daily performances. Erving Goffman, the American sociologist, articulated the idea of “life as theatre” in his 1956 book The Presentation of Self in Everyday Life, and while the book was published more than half a century ago, the concept is even more relevant today. It is increasingly difficult to live a private life, in terms not just of keeping our personal data away from governments or corporations, but also of keeping our movements, interests and, most worryingly, information consumption habits from the wider world.

The social networks are engineered so that we are constantly assessing others – and being assessed ourselves. In fact our “selves” are scattered across different platforms, and our decisions, which are public or semi-public performances, are driven by our desire to make a good impression on our audiences, imagined and actual. We grudgingly accept these public performances when it comes to our travels, shopping, dating, and dining. We know the deal. The online tools that we use are free in return for us giving up our data, and we understand that they need us to publicly share our lifestyle decisions to encourage people in our network to join, connect and purchase.

But, critically, the same forces have impacted the way we consume news and information. Before our media became “social”, only our closest family or friends knew what we read or watched, and if we wanted to keep our guilty pleasures secret, we could. Now, for those of us who consume news via the social networks, what we “like” and what we follow is visible to many [..] Consumption of the news has become a performance that can’t be solely about seeking information or even entertainment. What we choose to “like” or follow is part of our identity, an indication of our social class and status, and most frequently our political persuasion.

That sets the scene. People sell their lives, their souls, to join a network that then sells these lives -and souls- to the highest bidder, for a profit the people themselves get nothing of. This is not some far-fetched idea. As noted further down, in terms of scale, Facebook is a present day Christianity. And these concerns are not only coming from ‘concerned citizens’, some of the early participants are speaking out as well. Like Facebook co-founder Sean Parker:

 

Facebook: God Only Knows What It’s Doing To Our Children’s Brains

Sean Parker, the founding president of Facebook, gave me a candid insider’s look at how social networks purposely hook and potentially hurt our brains. Be smart: Parker’s I-was-there account provides priceless perspective in the rising debate about the power and effects of the social networks, which now have scale and reach unknown in human history. [..]

“When Facebook was getting going, I had these people who would come up to me and they would say, ‘I’m not on social media.’ And I would say, ‘OK. You know, you will be.’ And then they would say, ‘No, no, no. I value my real-life interactions. I value the moment. I value presence. I value intimacy.’ And I would say, … ‘We’ll get you eventually.'”

“I don’t know if I really understood the consequences of what I was saying, because [of] the unintended consequences of a network when it grows to a billion or 2 billion people and … it literally changes your relationship with society, with each other … It probably interferes with productivity in weird ways. God only knows what it’s doing to our children’s brains.”

“The thought process that went into building these applications, Facebook being the first of them, … was all about: ‘How do we consume as much of your time and conscious attention as possible?'” “And that means that we need to sort of give you a little dopamine hit every once in a while, because someone liked or commented on a photo or a post or whatever. And that’s going to get you to contribute more content, and that’s going to get you … more likes and comments.”

“It’s a social-validation feedback loop … exactly the kind of thing that a hacker like myself would come up with, because you’re exploiting a vulnerability in human psychology.” “The inventors, creators — it’s me, it’s Mark [Zuckerberg], it’s Kevin Systrom on Instagram, it’s all of these people — understood this consciously. And we did it anyway.”

Early stage investor in Facebook, Roger McNamee, also has some words to add along the same lines as Parker. They make it sound like they’re Frankenstein and Facebook is their monster.

 

How Facebook and Google Threaten Public Health – and Democracy

The term “addiction” is no exaggeration. The average consumer checks his or her smartphone 150 times a day, making more than 2,000 swipes and touches. The applications they use most frequently are owned by Facebook and Alphabet, and the usage of those products is still increasing. In terms of scale, Facebook and YouTube are similar to Christianity and Islam respectively. More than 2 billion people use Facebook every month, 1.3 billion check in every day. More than 1.5 billion people use YouTube. Other services owned by these companies also have user populations of 1 billion or more.

Facebook and Alphabet are huge because users are willing to trade privacy and openness for “convenient and free.” Content creators resisted at first, but user demand forced them to surrender control and profits to Facebook and Alphabet. The sad truth is that Facebook and Alphabet have behaved irresponsibly in the pursuit of massive profits. They have consciously combined persuasive techniques developed by propagandists and the gambling industry with technology in ways that threaten public health and democracy.

The issue, however, is not social networking or search. It is advertising business models. Let me explain. From the earliest days of tabloid newspapers, publishers realized the power of exploiting human emotions. To win a battle for attention, publishers must give users “what they want,” content that appeals to emotions, rather than intellect. Substance cannot compete with sensation, which must be amplified constantly, lest consumers get distracted and move on. “If it bleeds, it leads” has guided editorial choices for more than 150 years, but has only become a threat to society in the past decade, since the introduction of smartphones.

Media delivery platforms like newspapers, television, books, and even computers are persuasive, but people only engage with them for a few hours each day and every person receives the same content. Today’s battle for attention is not a fair fight. Every competitor exploits the same techniques, but Facebook and Alphabet have prohibitive advantages: personalization and smartphones. Unlike older media, Facebook and Alphabet know essentially everything about their users, tracking them everywhere they go on the web and often beyond.

By making every experience free and easy, Facebook and Alphabet became gatekeepers on the internet, giving them levels of control and profitability previously unknown in media. They exploit data to customize each user’s experience and siphon profits from content creators. Thanks to smartphones, the battle for attention now takes place on a single platform that is available every waking moment. Competitors to Facebook and Alphabet do not have a prayer.

Facebook and Alphabet monetize content through advertising that is targeted more precisely than has ever been possible before. The platforms create “filter bubbles” around each user, confirming pre-existing beliefs and often creating the illusion that everyone shares the same views. Platforms do this because it is profitable. The downside of filter bubbles is that beliefs become more rigid and extreme. Users are less open to new ideas and even to facts.

Of the millions of pieces of content that Facebook can show each user at a given time, they choose the handful most likely to maximize profits. If it were not for the advertising business model, Facebook might choose content that informs, inspires, or enriches users. Instead, the user experience on Facebook is dominated by appeals to fear and anger. This would be bad enough, but reality is worse.

And in a Daily Mail article, McNamee’s ideas are taken a mile or so further. Goebbels, Bernays, fear, anger, personalization, civility.

 

Early Facebook Investor Compares The Social Network To Nazi Propaganda

Facebook officials have been compared to the Nazi propaganda chief Joseph Goebbels by a former investor. Roger McNamee also likened the company’s methods to those of Edward Bernays, the ‘father of public’ relations who promoted smoking for women. Mr McNamee, who made a fortune backing the social network in its infancy, has spoken out about his concern about the techniques the tech giants use to engage users and advertisers. [..] the former investor said everyone was now ‘in one degree or another addicted’ to the site while he feared the platform was causing people to swap real relationships for phoney ones.

And he likened the techniques of the company to Mr Bernays and Hitler’s public relations minister. ‘In order to maintain your attention they have taken all the techniques of Edward Bernays and Joseph Goebbels, and all of the other people from the world of persuasion, and all the big ad agencies, and they’ve mapped it onto an all day product with highly personalised information in order to addict you,’ Mr McNamee told The Telegraph. Mr McNamee said Facebook was creating a culture of ‘fear and anger’. ‘We have lowered the civil discourse, people have become less civil to each other..’

He said the tech giant had ‘weaponised’ the First Amendment to ‘essentially absolve themselves of responsibility’. He added: ‘I say this as somebody who was there at the beginning.’ Mr McNamee’s comments come as a further blow to Facebook as just last month former employee Justin Rosenstein spoke out about his concerns. Mr Rosenstein, the Facebook engineer who built a prototype of the network’s ‘like’ button, called the creation the ‘bright dings of pseudo-pleasure’. He said he was forced to limit his own use of the social network because he was worried about the impact it had on him.

As for the economic, not the societal or personal, effects of social media, Yanis Varoufakis had this to say a few weeks ago:

 

Capitalism Is Ending Because It Has Made Itself Obsolete – Varoufakis

Former Greek finance minister Yanis Varoufakis has claimed capitalism is coming to an end because it is making itself obsolete. The former economics professor told an audience at University College London that the rise of giant technology corporations and artificial intelligence will cause the current economic system to undermine itself. Mr Varoufakis said companies such as Google and Facebook, for the first time ever, are having their capital bought and produced by consumers.

“Firstly the technologies were funded by some government grant; secondly every time you search for something on Google, you contribute to Google’s capital,” he said. “And who gets the returns from capital? Google, not you. “So now there is no doubt capital is being socially produced, and the returns are being privatised. This with artificial intelligence is going to be the end of capitalism.”

Ergo, as people sell their lives and their souls to Facebook and Alphabet, they sell their economies along with them. That’s what that means. And you were just checking what your friends were doing. Or, that’s what you thought you were doing.

The solution to all these pains is, likely unintentionally, provided by Umair Haque’s critique of economics. It’s interesting to see how the topics ‘blend’, ‘intertwine’.

 

How Economics Failed the Economy

When, in the 1930s, the great economist Simon Kuznets created GDP, he deliberately left two industries out of this then novel, revolutionary idea of a national income : finance and advertising. [..] Kuznets logic was simple, and it was not mere opinion, but analytical fact: finance and advertising don’t create new value, they only allocate, or distribute existing value in the same way that a loan to buy a television isn’t the television, or an ad for healthcare isn’t healthcare. They are only means to goods, not goods themselves. Now we come to two tragedies of history.

What happened next is that Congress laughed, as Congresses do, ignored Kuznets, and included advertising and finance anyways for political reasons -after all, bigger, to the politicians mind, has always been better, and therefore, a bigger national income must have been better. Right? Let’s think about it. Today, something very curious has taken place.

If we do what Kuznets originally suggested, and subtract finance and advertising from GDP, what does that picture -a picture of the economy as it actually is reveal? Well, since the lion’s share of growth, more than 50% every year, comes from finance and advertising -whether via Facebook or Google or Wall St and hedge funds and so on- we would immediately see that the economic growth that the US has chased so desperately, so furiously, never actually existed at all.

Growth itself has only been an illusion, a trick of numbers, generated by including what should have been left out in the first place. If we subtracted allocative industries from GDP, we’d see that economic growth is in fact below population growth, and has been for a very long time now, probably since the 1980s and in that way, the US economy has been stagnant, which is (surprise) what everyday life feels like. Feels like.

Economic indicators do not anymore tell us a realistic, worthwhile, and accurate story about the truth of the economy, and they never did -only, for a while, the trick convinced us that reality wasn’t. Today, that trick is over, and economies grow , but people’s lives, their well-being, incomes, and wealth, do not, and that, of course, is why extremism is sweeping the globe. Perhaps now you begin to see why the two have grown divorced from one another: economics failed the economy.

Now let us go one step, then two steps, further. Finance and advertising are no longer merely allocative industries today. They are now extractive industries. That is, they internalize value from society, and shift costs onto society, all the while creating no value themselves.

The story is easiest to understand via Facebook’s example: it makes its users sadder, lonelier, and unhappier, and also corrodes democracy in spectacular and catastrophic ways. There is not a single upside of any kind that is discernible -and yet, all the above is counted as a benefit, not a cost, in national income, so the economy can thus grow, even while a society of miserable people are being manipulated by foreign actors into destroying their own democracy. Pretty neat, huh?

It was BECAUSE finance and advertising were counted as creative, productive, when they were only allocative, distributive that they soon became extractive. After all, if we had said from the beginning that these industries do not count, perhaps they would not have needed to maximize profits (or for VCs to pour money into them, and so on) endlessly to count more. But we didn’t.

And so soon, they had no choice but to become extractive: chasing more and more profits, to juice up the illusion of growth, and soon enough, these industries began to eat the economy whole, because of course, as Kuznets observed, they allocate everything else in the economy, and therefore, they control it.

Thus, the truly creative, productive, life-giving parts of the economy shrank in relative, and even in absolute terms, as they were taken apart, strip-mined, and consumed in order to feed the predatory parts of the economy, which do not expand human potential. The economy did eat itself, just as Marx had supposed – only the reason was not something inherent in it, but a choice, a mistake, a tragedy.

[..] Life is not flourishing, growing, or developing in a single way that I or even you can readily identify or name. And yet, the economy appears to be growing, because purely allocative and distributive enterprises like Uber, Facebook, credit rating agencies, endless nameless hedge funds, shady personal info brokers, and so on, which fail to contribute positively to human life in any discernible way whatsoever, are all counted as beneficial. Do you see the absurdity of it?

[..] It’s not a coincidence that the good has failed to grow, nor is it an act of the gods. It was a choice. A simple cause-effect relationship, of a society tricking itself into desperately pretending it was growing, versus truly growing. Remember not subtracting finance and advertising from GDP, to create the illusion of growth? Had America not done that, then perhaps it might have had to work hard to find ways to genuinely, authentically, meaningfully grow, instead of taken the easy way out, only to end up stagnating today, and unable to really even figure out why yet.

Industries that are not productive, but instead only extract money from society, need to be taxed so heavily they have trouble surviving. If that doesn’t happen, your economy will never thrive, or even survive. The whole service economy fata morgana must be thrown as far away as we can throw it. Economies must produce real, tangible things, or they die.

For the finance industry this means: tax the sh*t out of any transactions they engage in. Want to make money on complex derivatives? We’ll take 75+%. Upfront. And no, you can’t take your company overseas. Don’t even try.

For Uber and Airbnb it means pay taxes up the wazoo, either as a company or as individual home slash car owners. Uber and Airbnb take huge amounts of money out of local economies, societies, communities, which is nonsense, unnecessary and detrimental. Every city can set up its own local car- or home rental schemes. Their profits should stay within the community, and be invested in it.

For Google and Facebook as the world’s new major -only?!- ad agencies: Tax the heebies out of them or forbid them from running any ads at all. Why? Because they extract enormous amounts of productive capital from society. Capital they, as Varoufakis says, do not even themselves create.

YOU are creating the capital, and YOU then must pay for access to the capital created. Yeah, it feels like you can just hook up and look at what your friends are doing, but the price extracted from you, your friends, and your community is so high you would never volunteer to pay for it if you had any idea.

 

The one thing that I don’t see anyone address, and that might prevent these pretty straightforward ”tax-them-til they-bleed!” answers to the threat of New Big Tech, is that Facebook, Alphabet et al have built a very strong relationship with various intelligence communities. And then you have Goebbels and Bernays in the service of the CIA.

As Google, Facebook and the CIA are ever more entwined, these companies become so important to what ‘the spooks’ consider the interests of the nation that they will become mutually protective. And once CIA headquarters in Langley, VA, aka the aptly named “George Bush Center for Intelligence”, openly as well as secretly protects you, you’re pretty much set for life. A long life.

Next up: they’ll be taking over entire economies, societies. This is happening as we speak. I know, you were thinking it was ‘the Russians’ with a few as yet unproven bucks in Facebook ads that were threatening US and European democracies. Well, you’re really going to have to think again.

The world has never seen such technologies. It has never seen such intensity, depth of, or such dependence on, information. We are simply not prepared for any of this. But we need to learn fast, or become patsies and slaves in a full blown 1984 style piece of absurd theater. Our politicians are AWOL and MIA for all of it, they have no idea what to say or think, they don’t understand what Google or bitcoin or Uber really mean.

In the meantime, we know one thing we can do, and we can justify doing it through the concept of non-productive and extractive industries. That is, tax them till they bleed. That we would hit the finance industry with that as well is a welcome bonus. Long overdue. We need productive economies or we’re done. And Facebook and Alphabet -and Goldman Sachs- don’t produce d*ck all.

When you think about it, the only growth that’s left in the US economy is that of companies spying on American citizens. Well, that and Europeans. China has banned Facebook and Google. Why do you think they have? Because Google and Facebook ARE 1984, that’s why. And if there’s going to be a Big Brother in the Middle Kingdom, it’s not going to be Silicon Valley.

 

 

Oct 272017
 
 October 27, 2017  Posted by at 9:33 am Finance Tagged with: , , , , , , , , ,  


Salvator Rosa Lucrezia as poetry 1640-41

 

The World’s Witnessing A New Gilded Age (G.)
ECB Sees Option for Ending QE With Short Taper in 2018 (BBG)
The Fed Balance Sheet Unwind Myth (Roberts)
Alarm Sounds Over State Of UK High Street As Sales Crash (G.)
75% of UK MPs Don’t Know Where Money Comes From (CityAM)
China’s Minsky Moment (Muir)
Catalonia’s Leader Rules Out Snap Election, Crisis Deepens (R.)
Catalan Companies Face Boycott Over Independence Push (AFP)
New JFK Files Reveal FBI Warning On Oswald And Soviets’ Missile Fears (G.)
Australian Court Rules Deputy PM Ineligible For Parliament (R.)
‘I Want The Government … To Bring Kindness Back’ (RNZ)

 

 

A hundred years ago.

The World’s Witnessing A New Gilded Age (G.)

The world’s super-rich hold the greatest concentration of wealth since the US Gilded Age at the turn of the 20th century, when families like the Carnegies, Rockefellers and Vanderbilts controlled vast fortunes. Billionaires increased their combined global wealth by almost a fifth last year to a record $6tn – more than twice the GDP of the UK. There are now 1,542 dollar billionaires across the world, after 145 multi-millionaires saw their wealth tick over into nine-zero fortunes last year, according to the UBS/PwC Billionaires report. Josef Stadler, the lead author of the report and UBS’s head of global ultra high net worth, said his billionaire clients were concerned that growing inequality between rich and poor could lead to a “strike back”. “We’re at an inflection point,” Stadler said. “Wealth concentration is as high as in 1905, this is something billionaires are concerned about.

The problem is the power of interest on interest – that makes big money bigger and, the question is to what extent is that sustainable and at what point will society intervene and strike back?” Stadler added: “We are now two years into the peak of the second Gilded Age.” He said the “$1bn question” was how society would react to the concentration of so much money in the hands of so few. Anger at so-called robber barron families who built up vast fortunes from monopolies in US rail, oil, steel and banking in the late 19th century, an era of rapid industrialisation and growing inequality in America that became known as the Gilded Age, led to President Roosevelt breaking up companies and trusts and increasing taxes on the wealthy in the early 1900s. “Will there be similarities in the way society reacts to this gilded age?,” Stadler asked. “Will the second age end or will it proceed?”

Read more …

We’re doing so well we need to keep throwing money at bankers.

ECB Sees Option for Ending QE With Short Taper in 2018 (BBG)

European Central Bank policy makers implicitly assume their newly-extended bond-buying program will be tapered to a halt by the end of next year so long as the inflation outlook improves, according to officials with knowledge of the discussions. The Governing Council, which met on Thursday, focused on the first nine months of next year for its quantitative-easing program and didn’t formally debate options for what to do after that, said the people, asking not to be named because the talks are private. While tapering would be possible, extending the program without changing the pace of purchases is also a credible option if inflation doesn’t show sufficient progress, one of them said. Whether to set a firm end-date on the bond-buying program has been a key sticking point for some officials.

The council agreed to cut monthly purchases in half, to €30 billion ($35 billion), and President Mario Draghi said that a “large majority” backed the decision to include a pledge to extend again if needed. He added that “it’s never been our view that things should stop suddenly.” The meeting came after governors were presented with several scenarios at a seminar on Wednesday, according to the people. Those included a reduction to 40 billion euros a month through June, and a 12-month tapering through December, similar to the Federal Reserve’s exit from its own program. The latter scenario wasn’t considered a realistic policy option, one of the people said. Governors also looked at a three-month scenario that would see buying after September tapered in monthly steps to 20 billion euros, 10 billion euros and 5 billion euros, another official said.

Read more …

“..In fact, just last week the Fed increased their balance sheet by over $13.5 billion dollars. No wonder the stock market shot higher.”

The Fed Balance Sheet Unwind Myth (Roberts)

Since the beginning of the year, the Federal Reserve has been heavily discussing, warning rather, they were going to begin to “unwind” their gargantuan balance sheet. As Michael Lebowitz recently penned in his subscription-only article “Draining The Punchbowl:” “Since QE was first introduced, the S&P 500 has gained 1,546 points. All but 355 points were achieved during periods of QE. Of those remaining 355 points, over 80% occurred after Trump’s victory.” That is a pretty amazing set of stats. I have previously noted the high correlation of the financial markets relative to the ongoing liquidity operations of the Federal Reserve. I have updated that analysis to show the reduction in the balance according to the Fed’s proposed schedule.

While the market stumbled following the end of QE in the United States, global QE, as shown in the charts of the major global Central Banks picked up the slack.

But now, the ECB has already begun discussing their plans to begin cutting the amount of their QE program by half in the coming year. The hope, of course, by Central Bank officials is that global economies are now humming along at a pace strong enough to withstand the reduction of “emergency measures.” Of course, the real question is whether the Central Bank’s “measures” of economic strength are accurate. While there are certainly indicators such as GDP growth, production, and employment measures which suggests that global economies are indeed on a cyclical upswing, there are also numerous measures which suggest the opposite.

With the Fed trying to raise interest rates, and reduce the balance sheet simultaneously, the “tightening of monetary policy” is a drag on economic growth and ultimately the stock market. But as I stated above, while the Fed is currently “discussing” the reduction of their balance sheet beginning in October, they actually haven’t. In fact, just last week the Fed increased their balance sheet by over $13.5 billion dollars. No wonder the stock market shot higher.

Read more …

It’s the weather. Too warm to shop.

Alarm Sounds Over State Of UK High Street As Sales Crash (G.)

The fastest monthly fall in high street sales since the height of the recession in 2009 has raised fears for the retail sector ahead of the crucial Christmas trading period. A survey by the the CBI found that 50% of retailers suffered declining sales in October while only 15% benefited from an increase, leaving a rounded balance of -36%, the lowest since March 2009. The business lobby group said the survey showed retailers were “feeling the pinch” from rising inflation, which has eaten into consumer incomes and squeezed profit margins. Uncertainty surrounding the outcome of the UK’s Brexit negotiations has also preyed on consumer confidence, which has declined sharply over the past 18 months and depressed spending. Figures estimating GDP growth in the third quarter showed the services sector holding up despite recent declines in wages adjusted for inflation.

However, the construction sector fell into recession. Rain Newton-Smith, the CBI chief economist, said: “While retail sales can be volatile from month to month, the steep drop in sales in October echoes other recent data pointing to a marked softening in consumer demand.” The gloomy CBI survey came as Debenhams warned of an “uncertain” environment on the high street in the run up to Christmas after suffering a 44% dive in profits. [..] Warm autumn weather and low consumer confidence in the wake of the Brexit vote have also combined to deliver a “grim” October, according to the John Lewis boss, Paula Nickolds, who revealed last week that shoppers are continuing to put off expensive household purchases. That comes after the UK retail sector recorded its lowest growth rate in four years for the three months to the end of September, according to official data.

Read more …

Maube the Bank of England should send them their reports?

75% of UK MPs Don’t Know Where Money Comes From (CityAM)

Only 15% of MPs surveyed answered correctly when asked a true/false question on whether banks create money when they make loans. Almost two-thirds of the 50 MPs surveyed by Dods for campaign group Positive Money wrongly thought banks can’t create money, while a quarter admitted they didn’t know. In a far from stellar field Conservative MPs outperformed slightly “in this regard”, with 19% answering correctly, compared to only one in 20 Labour MPs. More than three-quarters of the MPs surveyed incorrectly believed that only the government has the ability to create new money. Some 23% knew this to be false, with Labour performing better than the Conservatives. The Bank of England has previously intervened to point out that most money in the UK begins as a bank loan.

In a 2014 article the Bank pointed out that “whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money.” The perception of money creation has been complicated further by the unorthodox use of quantitative easing, in which the government creates money electronically, which is then used to buy financial assets. Fran Boait, executive director of Positive Money, said: “Despite their confidence in telling the public that there is ‘no magic money tree’ to pay for vital services, politicians themselves are shockingly ignorant of where money actually comes from. “There is in fact a ‘magic money tree’, but it’s in the hands of commercial banks, such as Barclays, HSBC and RBS, who create money whenever they make loans.”

Read more …

The difference between short and long term.

China’s Minsky Moment (Muir)

Sometimes you have to love the naivety of the markets. At this week’s Communist Party Congress meeting in Beijing, the governor of the PBoC (People’s Bank of China) said the following; “If we are too optimistic when things go smoothly, tensions build up, which could lead to a sharp correction, what we call a ‘Minsky moment’. That’s what we should particularly defend against.” Yet instead of focusing on this dire warning, markets are busy trying to discount the chance of a Powell Fed or a Republican tax cut. Although both of these developments would be important, China is the tail that wags the dog. Full stop. Figure out China, and all the other financial market forecasts become that much easier. Some might argue this “Minsky moment” warning is nothing more than a Central Bank whistling in the wind.

Didn’t Greenspan caution about a similar concern with his “irrational exuberance” speech? And didn’t that end up being a complete non-event? Yet I would argue that China is not the same as other countries. Although there are market elements to their economy, to a large degree, China is still a command economy. If Chinese leadership wants a particular outcome, they can just demand it, and it will happen. So when the head of the PBoC warns about a “Minsky moment”, it’s probably not a good idea to load up on financial assets. For the longest time, China exported goods and imported developed nation debt and other financial assets. They had already started down the road of re-balancing their economy away from this export driven model, but this recent development confirms that the old playbook should be thrown out the window.

The global financial system is changing, and China is leading the way. Their moves will reverberate for years in the future. The Chinese authorities have just put up the warning flag, and you would be foolish to not believe it. This long term warning coincides with my belief that over the short term, the risks are all to the downside. I have been banging the drum on the fact that the Chinese government have done everything in their power to keep markets stabilized through their Communist Party Congress. They haven’t even hidden this fact. From the big sign above the Shenzhen Securities Exchange building that read “Use every effort to protect the stability of stock market for 20 days,” to the recent release that the Chinese government has asked firms to delay bad result during Congress, the message is clear.

Read more …

Too many last minute turnarounds. But still explosive.

Catalonia’s Leader Rules Out Snap Election, Crisis Deepens (R.)

Catalonia’s leader Carles Puigdemont on Thursday said he would not hold a new regional election to break the deadlock between Madrid and separatists wanting to split from Spain, sharpening a political crisis that could turn into direct confrontation. Puigdemont had been expected to announce an election to head off moves by Madrid to take direct control of the autonomous region in the next few days. But, speaking in the courtyard of the regional government headquarters in Barcelona, Puigdemont said the central government had not provided sufficient guarantees that holding an election would prevent the imposition of direct rule. “I was ready to call an election if guarantees were given. There is no guarantee that justifies calling an election today,” Puigdemont said.

He said it was now up to the Catalan parliament to move forward with a mandate to break from Spain following an independence referendum that took place on Oct. 1 – a vote which Madrid had declared illegal and tried to stop. Some independence supporters are pushing him to unilaterally declare independence. Late on Thursday, the regional government’s business head resigned over his opposition to a unilateral declaration, a sign of growing division in the separatist movement. Puigdemont’s stand sets the stage for the Spanish Senate on Friday to approve the take-over of Catalonia’s institutions and police, and give the government in Madrid the power to remove the Catalan president.

But this could spark confrontation on the streets as some independence supporters have promised to mount a campaign of civil disobedience. Spanish Deputy Prime Minister Soraya Saenz de Santamaria, speaking in a Senate committee, said: “The independence leaders have shown their true face – they have promised a dream but are performing tricks.” The aim of Article 155 – the constitutional trigger for direct rule – was to permit any election to take place in a normal and neutral situation, she said. The Spanish government has said it would call such a vote within six months of taking over Catalonia.

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Sad.

Catalan Companies Face Boycott Over Independence Push (AFP)

Calls for a boycott of Catalan food, cars and other goods, to punish the region for its separatist push, are worrying businesses who fear the economy will suffer. “You have to hit them where it hurts the most: the wallet,” a Twitter user wrote under the hashtag #boycottcatalanproducts. “We Spaniards who do not want Spain to be broken up… we can take action by adopting dissuasive steps of an economic nature,” reads a Facebook page calling for consumers to snub Catalan products. Appeals for a boycott have become more urgent since Catalonia’s separatist regional government held a banned independence referendum on October 1 in defiance of Spain’s central government and courts. The campaign targets Catalonia’s key agriculture and food sectors, with consumers urged to shun cava, a sparkling wine, Estrella Damm beer, as well as Vichy Catalan and Font Vella bottled water.

Medicines are also on the list to hurt Catalonia’s important pharmaceutical sector, as well as cars made by Seat, German carmaker Volkswagen’s Spanish unit in the region. Products made by foreign multinationals in Catalonia, including Nestle and Unilever, have also been swept up in the campaign. Mobile phone applications help consumers identify which products come from the rebel region. The impact of the boycott campaign is hard to measure to date. “We have had some clients who have bought less,” especially in Madrid, Rosa Rebula, a manager at cava producer Rosell i Formosa, told AFP. But she said the company will only be able to confirm the trend in November — a peak period for sales of cava ahead of the Christmas holiday season.

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CIA/FBI got to Trump? They’ve had 50 years to redact docs, but need 6 months more? Best comment I read: A whole generation knows where they were when Kennedy was shot, except George HW Bush. Turns out he was in Dallas.

New JFK Files Reveal FBI Warning On Oswald And Soviets’ Missile Fears (G.)

The US government released 2,800 documents on Thursday, but President Donald Trump delayed the release of others, saying he had “no choice” but to consider “national security, law enforcement and foreign affairs concerns” raised mostly by the FBI and CIA. One of the first interesting documents to be unearthed, as journalists, scholars and the public pored over them, was a memo written by director J Edgar Hoover that said the FBI had warning of a potential death threat to Oswald, who was then in police custody. “There is nothing further on the Oswald case except that he is dead,” Hoover wrote on 24 November 1963. “Last night we received a call in our Dallas office from a man talking in a calm voice and saying he was a member of a committee organized to kill Oswald.

[..] The files comprise almost the final 1% of records held by the federal government and their publication follows a release in July when the record-keepers, the National Archives, posted 3,801 documents online, mostly formerly released documents with previously redacted portions. An administration official told reporters on Thursday that the files that remain secret have information that “remains sensitive depending on its context”. Trump ordered the agencies to review those redactions over the course of six months, the official said, to ensure more documents reach the public. The next deadline for documents is 26 April 2018. According to the National Archives, 88% of records related to Kennedy’s murder were already fully open and another 11% released but partially redacted. In total, that makes for about 5m pages.

The newly released documents also reveal that Soviet Union leaders considered Oswald a “neurotic maniac who was disloyal to his own country and everything else”, according to an FBI memo documenting reactions in the USSR to the assassination. The Soviet officials feared a conspiracy was behind the death of Kennedy, perhaps organised by a rightwing coup or JFK’s successor Lyndon Johnson. They also feared a war in the aftermath of Kennedy’s death, according to the memo: “Our source further stated that Soviet officials were fearful that without leadership, some irresponsible general in the United States might launch a missile at the Soviet Union.”

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How many more?

Australian Court Rules Deputy PM Ineligible For Parliament (R.)

Australia’s High Court ruled on Friday that Deputy Prime Minister Barnaby Joyce is ineligible to remain in parliament, a stunning decision that cost the government its one-seat parliamentary majority and forced a by-election. The Australian dollar fell a quarter of a U.S. cent after the unexpected decision. Australian Prime Minister Malcolm Turnbull said he accepted the court’s ruling, even though it was “clearly not the outcome we were hoping for”. Turnbull did not name a new deputy leader during a short news conference in Canberra soon after the court’s ruling. The Australian leader had been scheduled to travel to Israel on Saturday for a week-long visit but a spokesman for Turnbull told Reuters his departure has now been delayed. The spokesman said the new travel arrangements are still be finalised.

Turnbull’s center-right coalition is now in a precarious position. His Liberal Party is the senior party in a coalition with the smaller National Party, which Joyce led. He must now win the support of one of three independent lawmakers to keep his minority government afloat, with two sitting weeks of parliament left until it recesses for the year. At least two independent lawmakers have promised their support. Independent MP Bob Katter told Reuters he would support the government, but he may reconsider that if the coalition tried to block renewed efforts for a sweeping investigation into the scandal-ridden financial system. “I think we have the numbers for a commission into the banks and, if the government tries to block that, then I think we will get into murky waters,” Katter said. The opposition Labor Party immediately went on the attack and threatened to launch a legal challenge to every decision made by Joyce since last year’s election.

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Great intentions. But she has to talk to Trump, Xi et al.

‘I Want The Government … To Bring Kindness Back’ (RNZ)

Shortly before she was sworn in as the new Prime Minister, Jacinda Ardern spoke to Checkpoint with John Campbell as she was on her way to Government House in a Crown car. She said she wants the new government to “feel different”, to be empathetic and kind. There was a significant part of her that was focused on the work that needed to be done, she said. “Once you’re there, get on with it.” She said she wanted the government to feel different. “I want it to feel like we are a government that’s truly focused on everybody. Perhaps I’m more acutely aware of that sense having now led a set of negotiations in our government that brings together a range of parties.

“I know I need to transcend politics in the way that I govern for this next term of Parliament but I also want this government to feel different, I want people to feel that it’s open, that it’s listening and that it’s going to bring kindness back. “I know that will sound curious but to me if people see they have an empathetic government I think they’ll truly understand that when we’re making hard calls that we’re doing it with the right focus in mind.” She said there were tough times during the coalition negotiations. “It’s not about just preserving people’s political careers. It’s not about power. It’s about being in a position to make a difference to people who need it most. “This will be a government that works with others. “There is a lot to do.” Asked if there was a central tenet to her approach to the new role, she said it was empathy.

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