Sep 132020
 


Pieter Bruegel the Elder The Fall of Icarus 1558

 

What’s Behind The DOJ Aggression Toward Julian Assange (CT)
Senate Chairman Asks DOJ IG To Open Probe Into Wiped Mueller Phones (JTN)
The United States & Its Constitution Have Two Months Left (PCR)
Bill Maher Mocks Dems: ‘You Guys Are Whistling Past The Graveyard’ (Fox)
When There are No Consequences for Anything (Kunstler)
Russia Dispatches First Batches Of COVID19 Vaccine To All 85 Regions (RT)
Chinese Virologist Vows To Release Proof COVID19 Was Made In Wuhan Lab (JTN)
The Coming Wave Of Defaults (Richard Vague)
China Steel Exports Hit By 15 New Anti-Dumping Probes So Far In 2020 (SCMP)
Greek PM Announces Huge Military Spending To Counter Turkish Aggression (K.)
Greek Riot Police Fire Teargas At Refugees Campaigning To Leave Lesbos (G.)
Academy Strips ‘Schindler’s List’ Of Oscar Due To Lack Of Diversity (BBee)

 

 

India will go above 100,000 new daily cases next week, one third of all global new cases. The US was never above 75,000.

 

 

 

 

 

 

 

 

Steve Martin

 

 

Wonder why it took the right wing so long to wake up to how Julian Assange is linked to the whole machine. Did they really need Tucker Carlson for that?

This is lawyer “sundance” at the Conservative Treehouse. The article has a lot more info, not just on Assange; he’s been digging for a long time. I know, it’s right wing media. But nobody else will cover this. And we want to get Assange released.

What’s Behind The DOJ Aggression Toward Julian Assange (CT)

On April 11th, 2019, the Julian Assange indictment was unsealed in the EDVA. From the indictment we discover it was under seal since March 6th, 2018. On Tuesday April 15th more investigative material was released. Again, note the dates: Grand Jury, *December of 2017* This means FBI investigation prior to…. The FBI investigation took place prior to December 2017, it was coordinated through the Eastern District of Virginia (EDVA) where Dana Boente was U.S. Attorney at the time. The grand jury indictment was sealed from March of 2018 until after Mueller completed his investigation, April 2019. Why the delay? What was the DOJ waiting for? Here’s where it gets interesting…. The FBI submission to the Grand Jury in December of 2017 was four months after congressman Dana Rohrabacher talked to Julian Assange in August of 2017: “Assange told a U.S. congressman … he can prove the leaked Democratic Party documents … did not come from Russia.” [..]


Knowing how much effort the CIA and FBI put into the Russia collusion-conspiracy narrative, it would make sense for the FBI to take keen interest after this August 2017 meeting between Rohrabacher and Assange; and why the FBI would quickly gather specific evidence (related to Wikileaks and Bradley Manning) for a grand jury by December 2017. Within three months of the grand jury the DOJ generated an indictment and sealed it in March 2018. The EDVA sat on the indictment while the Mueller probe was ongoing. As soon as the Mueller probe ended, on April 11th, 2019, a planned and coordinated effort between the U.K. and U.S. was executed; Julian Assange was forcibly arrested and removed from the Ecuadorian embassy in London, and the EDVA indictment was unsealed.

As a person who has researched this three year fiasco; including the ridiculously false 2016 Russian hacking/interference narrative: “17 intelligence agencies”, Joint Analysis Report (JAR) needed for Obama’s anti-Russia narrative in December ’16; and then a month later the ridiculously political Intelligence Community Assessment (ICA) in January ’17; this timing against Assange is just too coincidental. It doesn’t take a deep researcher to see the aligned Deep State motive to control Julian Assange because the Mueller report was dependent on Russia cybercrimes, and that narrative is contingent on the Russia DNC hack story which Julian Assange disputes. This is critical. The Weissmann/Mueller report contains claims that Russia hacked the DNC servers as the central element to the Russia interference narrative in the U.S. election. This claim is directly disputed by WikiLeaks and Julian Assange, as outlined during the Dana Rohrabacher interview, and by Julian Assange on-the-record statements.


The predicate for Robert Mueller’s investigation was specifically due to Russian interference in the 2016 election. The fulcrum for this Russia interference claim is the intelligence community assessment; and the only factual evidence claimed within the ICA is that Russia hacked the DNC servers; a claim only made possible by relying on forensic computer analysis from Crowdstrike, a DNC contractor. The CIA holds a massive conflict of self-interest in upholding the Russian hacking claim. The FBI holds a massive interest in maintaining that claim. All of those foreign countries whose intelligence apparatus participated with Brennan and Strzok also have a vested self-interest in maintaining that Russia hacking and interference narrative. Julian Assange is the only person with direct knowledge of how Wikileaks gained custody of the DNC emails; and Assange has claimed he has evidence it was not from a hack.

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I understand it takes 3 hours to wipe an iPhone by getting the password wrong 10 times in a row (because delays are built into the process). That’s all I personally need to know.

The term “accidental” doesn’t fit anywhere in the narrative. And destroying this sort of evidence is a criminal offence.

Senate Chairman Asks DOJ IG To Open Probe Into Wiped Mueller Phones (JTN)

Wisconsin Sen. Ron Johnson on Friday asked Department of Justice Inspector General Michael Horowitz to open an investigation into the dozen-plus phones belonging to associates of the Robert Mueller special counsel that had been wiped of data prior to being surrendered to investigators. Government documents released this week listed multiple phones belonging to members of Mueller’s Russia collusion probe as having been cleared of all data before they were handed over to Horowitz’s office. Many of the phones, according to the documents, were purged of data after the users entered incorrect passwords too many times.


In his letter, Johnson—the chairman of the Senate Committee on Homeland Security and Governmental Affairs—said the missing data “raise[s] concerns about record retention and transparency.” The senator asked Horowitz’s office to “open an investigation into this matter to determine what, why, and how information was wiped, whether any wrongdoing occurred, and who these devices belonged to.” Johnson also asked Horowitz to explain “when and how [his] office was made aware of this matter,” what steps the office took to “confirm whether information on these phones had been wiped,” whether or not the phones in question had “text message capabilities,” and if Horowtiz’s office has “the capability to retrieve the information from these phones?” The letter asks for a response “no later than September 18, 2020.”

Read more …

Paul Craig Roberts knows the machinery.

The United States & Its Constitution Have Two Months Left (PCR)

Bob Woodward writes that Trump’s Secretary of Defense, General James Mattis, and Trump’s Director of National Intelligence, Dan Coats, spoke together about taking “collective action” to remove President Trump from office. General Mattis said Trump is “dangerous. He’s unfit.” This is the same thing that the Generals and the CIA said about President John F. Kennedy. When Generals and the CIA say that a president is unfit and dangerous, they mean he is dangerous to their budget. By “unfit” they mean he is not a reliable cold warrior who will keep hyping America’s enemies so that money keeps pouring into the military/security budget. By serving defense contractors instead of their country, generals end up very wealthy.

Both Kennedy and Trump wanted to normalize relations with Russia and to bring home US troops involved in make-war operations overseas that boost the profits of defense contractors. To stop Kennedy they assassinated him. To stop Trump they concocted Russiagate, Impeachgate, and a variety of wild and unsubstantiated accusations. The presstitutes repeat the various accusations as if they are absolute proven truth. The presstitutes never investigated a single one of the false accusations. These efforts to remove Trump did not succeed. Having pulled off numerous color revolutions in which the US has overthrown foreign governments, the tactics are now being employed against Trump. The November presidential election will not be an election. It will be a color revolution.

We have reached the point in the demise of our country that a simple statement of obvious truth is not believable. As a number of carefully researched and documented books, some written by insiders, have proved conclusively, the CIA has controlled the prestige American media since 1950. The American media does not provide news. It provides the Deep State’s explanations of events. This ensures that real news does not interfere with the agenda. The German journalst, Udo Ulfkotte, wrote a book, Bought Journalism, in which he showed that the CIA also controls the European press. To be clear, there are two CIA organizations. One is an agency that monitors world events and endeavors to provide more or less accurate information to policymakers.

The other is a covert operations agency. This agency assassinates people, including an American president, and overthrows uncooperative governments. President Truman publicly stated after he was out of office that he made a serious mistake in permitting the covert operations branch of the CIA. He said that it was an unaccountable government in inself. President Eisehnower agreed and in his last address to the American people warned of the growing unaccountable power of the military/security complex. President Kennedy realized the threat and said he was going “to break the CIA into a thousand pieces,” but they killed him first.

It would be easy for the CIA to kill Trump, but the “lone assassin” has been used too many times to be believable. It is easier to overthrow Trump’s reelection with false accusations as the CIA controlls the American and European media and has many Internet sites pretending to be dissident, a claim that fools insouciant Americans. Indeed, it is the leftwing that the CIA owns. The rightwing goes along because they think it is patriotic to support the military/security complex. After the CIA overthrows Trump, they will use Antifa, Black Lives Matter, and their presstitutes to foment race war. Then the CIA will ride in on the Pale Horse, and the population will submit.

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“…5 or 6% is a lot in this country. That’s a big, big, big victory. And if he doesn’t get that…”

Bill Maher Mocks Dems: ‘You Guys Are Whistling Past The Graveyard’ (Fox)

“Real Time” host Bill Maher wasn’t nearly as confident about a Joe Biden victory in November as his guests were on Friday night. Maher began by citing what he called “frightening” finds from electoral analyst Nate Silver, who recently determined that if Biden wins the popular vote by less than 1%, he’ll have only a “6 percent chance” of becoming president through the electoral college. Similarly, if Biden wins the popular vote by 1 or 2%, he’ll have a “22% chance” of being elected in addition to the “46% chance” with a 2 to 3% popular vote margin. “So he could win by 3 percent and he still has less than half a chance of winning the election,” Maher said. “You’ve got to get up to 5 or 6% before he has a 98% chance of winning the election. That’s a f—ed up country.”

Author Jessica Yellin, a former CNN correspondent, dismissed any reason for panic among Democrats, pointing to Biden’s “unbelievably steady” polling throughout the year, stressing that he’s been “consistently up 6 points” against President Trump, and adding that the numbers don’t indicate the “worst-case scenario” like they did in 2016. Vanity Fair contributor Peter Hamby cited Trump’s weak polling among independents and women, insisting that a “fundamental shifting” among voters “would take something overwhelmingly dramatic.” “The whole ‘What about 2016?’ thing, it’s just not 2016,” Hamby insisted. “People have had four years of Donald Trump. A verdict has more or less been rendered since he’s taken office … and Joe Biden is just not Hillary Clinton. He’s not.”

“I know,” Maher responded. “But what Nate Silver is seeing, it doesn’t matter. Because 5 or 6% is a lot in this country. That’s a big, big, big victory. And if he doesn’t get that — and races tighten at the end! You sound like the panels I used to have on right before the last election. … You guys are whistling past the graveyard.” Yellin doubled down, telling Maher she thinks it’s “very hard” to see Trump convince the rest of undecided voters to support him, pointing to polling that shows his “law and order” messaging has not improved his standing among voters. “So far. Right now,” Maher told Yellin. “You think it’s going to shift?” Yellin replied. “It could,” Maher said. “People generally don’t like violence in the streets. I mean, yes, you’re right.

When he says, ‘I’m the one who’s going to protect you,’ they’re not getting that. They’re not buying that. What they’re saying is ‘Joe Biden is a healer and we need healing right now.’ But this could change.” Maher has previously expressed doubt about Biden’s chances for a November victory. Last month, he told MSNBC’s Joy Reid he was feeling “very nervous” following the conclusion of the Republican National Convention. “I am feeling less confident about this — maybe it’s just their convention bump got to me, but I’m feeling less confident than I was a month ago,” Maher said. “I feel very nervous, the same way I did four years ago at this time.”

Read more …

The usual suspects.

When There are No Consequences for Anything (Kunstler)

We’re informed hours ago, for instance, that the top lawyers in Robert Mueller’s Special Counsel operation wiped all the records from their cell phones before the DOJ Inspector General could collect evidence of their communications from the SC team’s three-year exercise in overthrowing a president. How is that not an obstruction of justice, and who will answer for it?

That’s on top of many other bits of essential evidence in the RussiaGate coup and other perfidious acts mysteriously gone missing — Special Agent Joe Pientka’s original “302” document from the Flynn interrogation, thousands of Strzok-and-Page’s text messages, official verifications of the Steele Dossier submitted to the FISA court, communications between the FBI “small group” (Comey, McCabe, Priestap, Carlin, McCord, Baker, et al.) plus CIA Chief John Brennan and DNI James Clapper with Senators Burr and Warner on the Senate Intel Committee, communications between “whistleblower” Eric Ciaramella, Col. Alexander Vindman and House Intel Committee chair Adam Schiff, records of CIA prop Stephan Halper’s doings with the Pentagon’s Office of Net Assessment, all communication records between State Department official Jonathan Winer and British ex-spy Christopher Steele….

And now, like a fever building to climax, comes the news right out-front that the Democratic Party intends to foment insurrection if the election goes against them. They’re supporting the coming siege of Lafayette Square set to kick off fifty days of “protest” across from the White House beginning Sept 17 as a warm-up for anarchy in the streets across the nation following the Nov 3 vote. Behind us is the summer of riots, arson, and looting, and who paid to support all that? Who paid for flying Antifa and BLM personnel from city to city, feeding and housing them, paying for their “commercial-grade” fireworks, pallets of bricks, gas masks, lasers, bullhorns, black riot outfits? Why is it hard to find out who bought the plane tickets, booked the hotels? Months have gone by since all that started. Is someone in the DOJ following the money? And following their communications (especially considering the crimes against property they’ve committed)?

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Yes, the Lancet, world no. 1 medical journal, said the vaccine is 100% effective. Questions?

Russia Dispatches First Batches Of COVID19 Vaccine To All 85 Regions (RT)

Russia has sent out the initial batches of the world’s first registered coronavirus vaccine to all parts of its vast territory, as authorities test the delivery system of the much-needed drug. The formula is expected to be delivered on Monday, said Russia’s Health Minister Mikhail Murashko. “The first small batches have already been shipped,” Murashko said, explaining that the government is testing the supply chain to ensure a robust delivery system across the country’s 85 regions. As well as testing the efficacy and safety of the vaccine itself, the government believes it is paramount to ensure the efficient distribution to citizens, especially to those at high risk. Russia’s homegrown Covid-19 formula is currently in the third and final stage of clinical trials, in which 40,000 Muscovites will take part.


While three-quarters will receive the jab, another quarter will be given a placebo. On Wednesday, Moscow’s Deputy Mayor Anastasia Rakova announced that testing had begun, and over 35,000 residents had applied. “Clinical trials have begun in Moscow,” Murashko said, adding that the ministry had also created “the world’s first mobile application” that allows participants to “report on their condition” throughout the lengthy trial period. [..] The vaccine’s development process has been criticized by some Western countries for its supposedly unsafe rapid development and improper testing. However, earlier this month, the respected British medical journal The Lancet published the Russian Ministry of Health’s Sputnik V study, showing the vaccine to be 100% effective, producing antibodies in all 76 participants of early-stage trials.

Halloween

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We are curious.

Chinese Virologist Vows To Provide Proof COVID19 Was Made In Wuhan Lab (JTN)

A Chinese scientist who reportedly fled her home country out of fear for her safety has said that she intends to release evidence proving that SARS-Cov-2 did not arise in nature but was actually manufactured in the Wuhan Institute of Virology. Virologist Li-Meng Yan claims to have done some of the earliest work on COVID-19 when it first emerged in China last year. She has said she left China in April and that she is currently in hiding in the U.S. On the British ITV television show “Loose Women” on Friday, Yan said she intends to release evidence showing “why this has come from the lab in China, why they are the only ones who made it.”


“The genome sequence [of the virus] is like a human finger print,” she told the talk show. “And based on this you can identify these things.” Yan said at the start of the pandemic she attempted to warn her supervisors of the threat the virus posed yet she was ignored. The scientist on the show declared it “critical” for the world to understand the virus’s origins, claiming: “We can not overcome it, it will be life-threatening for everyone,” though current epidemiological data indicate that the virus likely has a survival rate above 99%.

Read more …

The wave appears slow in the distance; it won’t be as it gets nearer.

The Coming Wave Of Defaults (Richard Vague)

With COVID-related income supplements and unemployment benefits now expired or reduced, we face a new wave of mortgage and rental delinquencies, many of which will come in the next few months. According to the Mortgage Bankers Association, as of June 30, mortgage delinquency in the U.S. had reached 8.2 percent, the highest since 2011 and almost double the 4.5 percent of a year earlier. With 53 million mortgages in the U.S., that means more than 4.3 million mortgages are delinquent. Add to that the fact that, per Black Knight mortgage analytics, almost 5 million homes have been in forbearance. With that, I estimate that at least 1 million to 2 million more of these loans will fall delinquent before the end of this year.

As for renters, the U.S. Census Bureau reports that, as of July, 18 percent were delinquent in their rent payments. That compares with less than 7 percent in prior years. With more than 43 million renters, that means more than 7.4 million are behind on their rental payments. With the loss of income and unemployment support, it is reasonable to believe that number will increase by several million over the next few months. Many of the resulting evictions that normally would have occurred have been forestalled by government mandate, and a major portion of the mortgage payments and apartment rental payments that would have been late have been staved off by the lifeline of the $1,200 checks from the CARES Act and augmented unemployment benefits.

Since this assistance has now expired, a new wave of delinquency is before us, and millions more Americans could go delinquent in the months immediately ahead. When people go delinquent on their mortgage or rent because of COVID-based job loss or income reduction, their lives often become a proverbial hell. Many resort to bankruptcy as a refuge. But that is just the start of what is a chain of impairment. For renters, their landlords are then hurt because of those missed rent payments, and so they in turn go into default on the loans they took out to buy the rental property, something felt especially by the small landlords who have little clout with their lenders. Then the lenders themselves — those that made mortgage loans to households and those that made property acquisition loans to the small landlords — suffer loss.

This all comes because the individuals who make up the first link in that chain can’t pay, often just temporarily. All can be protected — at least over the near term — by continued government support such as proposed in the HEROES Act now being debated in Congress. With that, individuals would be able to pay their rent and mortgages, and thus small landlords would be able to pay their loans, and community lenders could avoid major losses.

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Overproduction. China can’t do without it.

China Steel Exports Hit By 15 New Anti-Dumping Probes So Far In 2020 (SCMP)

China’s steel exports have been subject to 15 new anti-dumping investigations in the first nine months of the year, more than all of last year, as experts warn that the US-China trade war and the coronavirus pandemic have hastened a trend towards global protectionism. The US, Britain, Australia and Thailand are among the countries that have initiated dumping probes into Chinese products, including steel plates, grinding balls, cylinders and strands, as well as galvanised wires. Last year, China faced 13 anti-dumping investigations into its steel exports, according to the China Trade Remedies Database. Thailand went a step further in August, slapping a 35.67 per cent anti-dumping tariff on Chinese hot-dipped galvanised coils and sheets.

China, the world’s biggest steel producer, has long been accused of flooding the international market with cheap, subsidised steel, primarily due to oversupply at home. It produced 996 million tonnes of crude steel last year, more than half of the world’s combined output of 1.8 billion tonnes, according to the World Steel Association. But against the backdrop of the coronavirus pandemic, many smaller steel producers in Asia have had enough and are doing everything possible to protect their domestic industries. Korrakod Padungjitt, a Thai steel manufacturer and secretary general of the Thailand Iron and Steel Industry Club, said his country’s latest anti-dumping tariff on Chinese steel would just be a drop in the ocean. Chinese steel started flowing into Thailand in the early 2000s and has increasingly squeezed regional manufacturers, Korrakod said.

The Chinese steel onslaught was so ferocious that in 2010, mainland producers mixed alloy in their steel products to circumvent existing tariffs, he added. The issue is now a regular feature of annual meetings between the Asean Iron and Steel Council and the China Iron and Steel Association. Thailand’s industrial sector has been hard hit by the pandemic, with both investment and consumption plummeting. In July, Thailand’s car production fell 47 per cent compared to the same time last year, which was a significant blow to the steel sector. Earlier this year, Thailand’s Department of Foreign Trade launched an anti-dumping investigation into Chinese hot-dipped galvanised coils and sheets, which are used largely in construction and manufacturing, and in August followed through with a 35.67 per cent duty.

Read more …

Money that should go to refugees and homeless. Not French arms dealers. But due to historic and geographical factors, Greeks take their army very seriously. They’re one of few countries that meet their NATO quota.

Greek PM Announces Huge Military Spending To Counter Turkish Aggression (K.)

Greece will strengthen its armed forces by buying new weapons systems, Prime Minister Kyriakos Mitsotakis announced Saturday. Specifically, Greece will acquire 18 Rafale fighters, a full squadron’s strength, to replacing the aging Mirage 2000 planes; 4 new frigates, while refurbishing 4 existing ones; 4 Romeo naval helicopters; antitank weapons for the Army; torpedoes for the Navy and guided missile for its Air Force. It will also add 15,000 professional soldiers to its armed forces over the next five years, Mitsotakis said. The new weapons procurement program comes amid heightened tensions with Turkey over resources in the eastern Mediterranean. Its announcement dominated the first half of Mitsotakis’ speech on the grounds of the Thessaloniki International Fair (TIF).


The trade fair itself has been canceled, due to the coronavirus pandemic, but Mitsotakis delivered the customary speech describing next year’s economic policy. The extra spending on defense did not prevent Mitsotakis from announcing a new €6.8 billion injection into the economy, in the form of payroll and other tax cuts, subsidies and payments of pension cuts restored by the courts. “A shift in priorities (toward defense spending) does not mean a change in goals,” Mitsotakis told a restricted audience of just 50, all wearing masks and maintaining social distancing. “Ankara is now adding to the provocations in the Aegean, the undermining of peace in the entire Mediterreanean,” Mitsotakis said. “It is threatening the eastern borders of Europe, and it is undermining security in a sensitive crossroads of three continents.”

Greece military boost

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Wait. 200,000 Covid-19 rapid tests(?!) Which ones are those? Are they just PCR executed fast, or actual rapid tests?

Greek Riot Police Fire Teargas At Refugees Campaigning To Leave Lesbos (G.)

Greek riot police fired teargas at protesting refugees clamouring to leave Lesbos as the situation on the island became more explosive days after devastating fires forced thousands to flee its notorious migrant camp. Tensions mounted as asylum seekers, desperate to make their way to other parts of Europe, watched authorities, including the Greek army, rush to replace the now gutted facility of Moria with a new holding centre. “Freedom, freedom,” demonstrators chanted under the watchful eye of riot police deployed to the Aegean isle from Athens. “We don’t need new camp … we want freedom,” proclaimed some of the crude handwritten placards held aloft by protesters on Saturday.

Witnesses reported teargas being fired after younger migrants began lobbing rocks at the police units. A series of overnight blazes starting on Tuesday razed Moria, Europe’s largest refugee camp, decanting close to 13,000 men, women and children into the surrounding countryside. With the exception of 406 lone migrant children who have been flown to the Greek mainland, the former residents have been left to fend for themselves, many making makeshift shelters out of tarps and bamboo reeds along the side of a main road leading to Mytilene, the island’s port capital. Others have camped in fields, olive groves, churches and even cemeteries.

Frustration, the insistence of Greek officials that transferal is out of the question and a growing realisation that any prospect of leaving is diminishing fast have helped create an increasingly toxic atmosphere. The destruction of containers housing the asylum service in Moria has further fuelled a prevailing sense of desperation among refugees. “The thought that they may be here for even longer now, the sight of the replacement camp and being stranded without proper shelter for days has, for many, become the tipping point,” said one aid worker requesting anonymity because she was not authorised to speak. Earlier, Greece’s alternate migration minister, Giorgos Koumoutsakos, told SKAI TV Lesbos was facing a public health emergency, “a triple challenge” that also involves “public order and national security”.

On Saturday a woman and her 20-month-old baby were flown to Athens where they will be hospitalised after testing positive for the virus. They were not among the original group, most of whom were described as asymptomatic carriers of Covid-19. With fears of infection rates increasing, some 200,000 Covid-19 rapid tests were flown into Lesbos on a specially chartered plane on Friday. “There are now real fears among our island’s residents of the virus spreading,” local journalist Yannis Sinanis told the Guardian. Officials were working around-the-clock to erect the new settlement, a collection of 500 tents with the capacity to accommodate six people each. Other asylum seekers are expected to be accommodated in a ferryboat and naval ships.

Read more …

“..the Academy has plans to strip the award from over 95% of the winners and give them all to Brokeback Mountain.”

Academy Strips ‘Schindler’s List’ Of Oscar Due To Lack Of Diversity (BBee)

The Academy of Motion Picture Arts and Sciences has stripped Schindler’s List of its Best Motion Picture award for not having enough LGBTQ+ characters, people of color, and other oppressed groups. “Schindler’s List would have been a great movie if it just had a dozen transgendered characters,” said Le’Jon de Froofroo, spokesperson for the Academy. “As it is, there are just a bunch of Jews and Germans — very privileged races.” “Also, the movie has Nazis — this is the current year, for goodness’ sake!” Steven Spielberg has been ordered by the Academy to re-release the film with an unnecessary LGBTQ+ side plot, a gay roommate for Schindler, and a song and dance number set to a Lady Gaga song over the end credits if he wishes to re-earn the Academy Award. Otherwise, it will be re-awarded to Brokeback Mountain. This is just the first Oscar winner to be stripped of its award, as the Academy has plans to strip the award from over 95% of the winners and give them all to Brokeback Mountain.

Read more …

 

 

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Jun 062020
 


F.A. Loumis Independence Day 1906

 

Just 20% Of Coronavirus Cases Responsible For 80% Of Transmissions (RT)
Hydroxychloroquine Does Not Cure COVID19, Say Drug Trial Chiefs (G.)
A Second Major COVID Study Is Retracted (Newser)
UK Care Home Residents Face Steep Hike In Fees (BBC)
Bill Gates Dismisses ‘Bizarre’ COVID19 Conspiracy Theories (RT)
Tidal Wave Of Defaults And Evictions Looms (NPR)
Surprise: The BLS Admits Another Phony Jobs Report (Mish)
Biden Clinches Nomination, Readies For Fall Showdown With Trump (JTN)
Biden: 10-15% of Americans Are ‘Not Very Good People’ (JTN)
Lisa Page Is The New National Security And Legal Analyst At NBC News
Senate Approves 35 Subpoenas for Obama Administration Officials (NBC)
Letter From Lt. Gen. Michael T. Flynn, ‘I Am Not Done’ (SAC)

 

 

Worldometer puts global new cases for June 5 at + 130,529. Another record.

 

Note: I count not from midnight GMT to midnight GMT, as they do, but from about 6 am EDT to 6 am EDT.

My count over the past 24 hours is over + 147,000 cases.

 

 

New cases past 24 hours in:

• US + 25,393
• Brazil + 30,136
• Russia + 8,855
• India + 9,944
• Pakistan + 8,719
• Mexico + 4,346

 

 

 

 

 

Cases 6,871,728 (+ 147,632 from yesterday’s 6,724,096)

Deaths 398,663 (+ 5,110 from yesterday’s 393,553)

 

 

 

From Worldometer yesterday evening -before their day’s close-:

 

 

From Worldometer:

 

 

From COVID19Info.live:

 

 

 

 

 

 

I don’t suffer from insanity, I enjoy every minute

 

 

Superspreaders are simply people stupid enough to socialize a lot in long lasting events in closed spaces. That’s why “..roughly 80 percent of the effects come from 20 percent of the causes.”

Just 20% Of Coronavirus Cases Responsible For 80% Of Transmissions (RT)

The latest research into so-called “superspreader events” could inform public policy across the world, to help fight the widely feared “second wave” of coronavirus infections, but without the need for strict lockdowns. A “superspreader” is an infected person who transmits a virus to a large number of people. A growing body of evidence has found that superspreaders account for the vast majority of coronavirus transmissions. In the latest study on superspreaders, epidemiologists in Hong Kong analyzed over 1,000 coronavirus cases between January 23 and April 28, and found that just 20 percent of cases were responsible for 80 percent of total transmissions, data which could impact policy around the world. About 350 of the cases were community transmissions, while the rest were imported cases.

More than 50 percent of the community transmission cases were traced back to just six superspreader events, all of which involved indoor social gatherings that lasted several hours. “Superspreading events are happening more than we expected, more than what could be explained by chance. The frequency of superspreading is beyond what we could have imagined,” Ben Cowling, one of the study’s co-authors said. The study also found that 70 percent of infected people did not pass the virus to anyone else, further highlighting the need for a highly targeted response to defeating the pandemic. The work has yet to undergo peer review, but joins a growing body of work indicating the particular method of transmission which has spread the coronavirus to every corner of the globe, with disastrous consequences. If corroborated, however, this research could inform future public policy across the world.

Among the Hong Kong superspreading events studied, each ‘superspreader’ coronavirus carrier infected three times the average infection rate. The majority of the superspreader cases were traced back to a wedding, an event at a temple, and several bars in Hong Kong’s Lan Kwai Fong district. “You might be wondering if our study, or the experience of Hong Kong, with its small number of total infections, is more broadly representative. We think so,” Cowling wrote, referring to a widely studied phenomenon known as the “80-20 rule” or the “Pareto principle,” in which, for many events, roughly 80 percent of the effects come from 20 percent of the causes.

[..] One model from researchers at the London School of Hygiene and Tropical Medicine took it one step further and suggested just 10 percent of coronavirus cases may have accounted for at least 80 percent of transmissions worldwide. Similar results were found in coronavirus research conducted in Israel and China.

Read more …

Two “studies” embarrassingly flattened but they just keep on coming.

Again, nobody of any importance to the discussion has ever claimed HCQ cures COVID19. Why keep referring to that? It is not a vaccine, there is no claim to that. Remember, meanwhile remdesivir is being touted because it MIGHT shorten hospital stays by a few days.

As for this trial: there is no data in this piece on the stage at which patients wre given HCQ. If they were already severely sick, it would have been too late. Also, no mention of zinc.

Why do all these medical professionals volunteer to look ridiculous?

Hydroxychloroquine Does Not Cure COVID19, Say Drug Trial Chiefs (G.)

Hydroxychloroquine does not work against Covid-19 and should not be given to any more hospital patients around the world, say the leaders of the biggest and best-designed trial of the drug, which experts will hope finally settle the question. “If you are admitted to hospital, don’t take hydroxychloroquine,” said Martin Landray, deputy chief investigator of the Recovery trial and professor of medicine and epidemiology at Oxford University. “It doesn’t work.” Many countries have permitted emergency use of the drug for Covid-19 patients in hospitals, following claims from a few doctors, including Didier Raoult in France, that it was a cure, and the ensuing clamour from the public. President Donald Trump backed the drug, saying it should be given to patients, and later said he was personally taking it to protect himself from the virus.

Landray said the hype should now stop. “It is being touted as a game-changer, a wonderful drug, a breakthrough. This is an incredibly important result, because worldwide we can stop using a drug that is useless.” The first results from the Recovery trial, which has been testing seven therapies for Covid-19, swiftly followed the retraction of a paper in the Lancet medical journal on Thursday night claiming that hydroxychloroquine was linked to an increased risk of death in Covid-19 patients. The authors of the paper withdrew it after the US company Surgisphere refused to cooperate with an independent audit of the data it had supplied for the study.

Supporters of the drug hailed the paper’s retraction, but the World Health Organization and countries that have authorised use of the drug are now likely to change their position. The Recovery trial is a “gold standard” randomised controlled trial, designed to find an answer to a question by recruiting patients in similar circumstances either to take the drug or to take a placebo. Their doctors and the researchers do not know which ones are taking the genuine trial drug.

[..] Since March, when the trial began, a total of 1,542 patients had been randomised to receive hydroxychloroquine, while 3,132 patients were randomised to receive only normal care. Over 28 days, 25.7% of patients on hydroxychloroquine died, compared with 23.5% of the others. The difference is not statistically significant – it could have arisen by chance. But the clear conclusion was that hydroxychloroquine did not work, said the researchers.

Read more …

“.. I did not do enough to ensure that the data source was appropriate for this use..”

Fire the man, defund him. He never saw the data or the sources, he simply believed what he was fed because it served his purposes and those of his funders.

A Second Major COVID Study Is Retracted (Newser)

First, the esteemed Lancet medical journal retracted a major study on Thursday about hydroxychloroquine. Then, the New England Journal of Medicine did the same with another big study related to COVID-19 and blood pressure drugs. Both retractions have a common denominator: They relied on data supplied by a US analytics company called Surgisphere, which is coming under increasing scrutiny over the credibility of its international database. The Lancet study had cast doubt on the effectiveness of the anti-malarial drugs hydroxychloroquine and chloroquine as a coronavirus treatment, reports the Wall Street Journal. The retraction is now renewing the hope that the drugs (highly touted by President Trump) can work safely after all, and the World Health Organization already has said it would resume trials, notes the New York Times.


“It is now clear to me that in my hope to contribute to this research during a time of great need, I did not do enough to ensure that the data source was appropriate for this use,” says Harvard’s Mandeep Mehra, who was the lead author of both studies. “For that, and for all the disruptions—both directly and indirectly—I am truly sorry.” Both studies listed as a co-author Surgisphere founder/CEO Sapan Desai, whose name appears only on the NEMJ retraction. His company claims to have collected patient data from hospitals all over the world, but now red flags are going up. The Journal, for instance, got in touch with a dozen big US hospitals, and none shared patient data with the company. Surgisphere previously said it couldn’t name the 671 hospitals in the Lancet study out of privacy concerns. The controversy illustrates the rushed state of research amid the pandemic, notes the Times.

Read more …

It’s cheaper to die, gramps.

UK Care Home Residents Face Steep Hike In Fees (BBC)

Some older people in care homes are being asked to pay more than £100 a week extra in fees to cover the costs of coronavirus. Age UK said residents who pay their own fees are facing the bills to pay for protective gear and rising staff costs. It adds “insult to injury” for people who have “been through the mill” during the pandemic, the charity said. The government said it provided £600m for infection control in care homes and £3.2bn for wider council services. Care home residents who fund themselves have effectively subsidised the care system for many years, paying far more for their support than those funded by their local authority.


Age UK says on average these residents are charged just over £850 pounds a week, and some are now seeing their fees rise by 15%. It is not clear how many care homes have asked self-funding residents to pay more. There are 400,000 people estimated to be living in care homes in England, with 167,000 believed to be self-funders and 45,000 part self-funders. Caroline Abrahams, director of Age UK, said older people and their families have “been through the mill” in recent months as outbreaks occurred in one in three care homes. “It is adding insult to injury that after going through so much, some residents who pay for their own care are now facing a big extra bill – on top of already expensive fees.”

Read more …

The bogeyman speaketh. Extreme fear ensues.

Bill Gates Dismisses ‘Bizarre’ COVID19 Conspiracy Theories (RT)

“It’s almost hard to deny this stuff because it’s so stupid or strange that even to repeat it gives it credibility,” Gates said on numerous conspiracy theories swirling around him since the coronavirus crisis began and he became an outspoken champion for a vaccine. The Bill & Melinda Gates Foundation has just recently pledged $1.6 billion to vaccine alliance group Gavi, which will use the money to immunize children in poorer nations. Conspiracy theories linking Gates to the origins of Covid-19 or arguing he wants to track citizens through microchips under the guise of ensuring they are vaccinated against the virus were mentioned over a million times before May, according to Zignal Labs, a media analytics company.

The theories continue to swirl around social media and a poll from Yahoo News/YouGov from late last month even found 28 percent of respondents believed Gates wanted to use the coronavirus as an excuse to track and store their information. Among Republican respondents, that percentage was even higher. “I’ve never been involved in any microchip type thing,” Gates said, calling the poll results “concerning.” He did admit “data systems” would be a good idea to track a Covid-19 vaccine, but “there’s no chips or anything like that.” Gates has thrown his support behind a “national tracking system.” Concerns and theories about Gates’ influence have only intensified as his standing in the world has increased.

Already the second richest man on the planet with a net worth of about $100 billion, he is about to become the largest donor to the WHO, a position previously held by the US before President Donald Trump cut ties with the international group over their handling of the pandemic. In the last two years, the Bill and Melinda Gates Foundation has accounted for over 12 percent of the WHO’s budget, which equates to approximately $530 million, according to Devex. It is followed by Gavi alliance (8.18 percent) that the foundation also sponsors. The US gave slightly more in that time frame with payments equalling around $890 million. Lawrence Gostin the director of WHO’s Collaborating Center on National and Global Health Law, told Devex the potential of a private foundation becoming the largest donor to the organization could be “transformational.” “It would enable a single rich philanthropist to set the global health agenda,” he said.

Read more …

Storm warning.

Tidal Wave Of Defaults And Evictions Looms (NPR)

Americans are skipping payments on mortgages, auto loans and other bills. Normally, that could mean massive foreclosures, evictions, cars repossessions and people’s credit getting destroyed. But much of that has been put on pause. Help from Congress and leniency from lenders have kept impending financial disaster at bay for millions of people. But that may not last for long. The problem is that these efforts aim to create a financial bridge to the future for people who’ve lost their income in the pandemic — but the bridge is only half-built.

[..] millions of people are getting help from all kinds of lenders. According to the latest available numbers from the credit bureau TransUnion, about 3 million auto loans and 15 million credit card accounts are in some kind of program to let people skip or make partial payments. Those are probably low estimates. According to the analytics company Black Knight, 4.75 million homeowners — or 9% of all mortgages — have entered into forbearance plans. Lawmakers don’t want these delayed payments to hurt credit scores. Congress mandated that people who were current on their payments before the outbreak should still be reported as current on their payments while in a hardship program. And that appears to working for now.

“What we’re seeing consistently across the board is actually credit scores are moving upward,” says Matthew Komos, a vice president at TransUnion. He says that’s both on a month-to-month and year-over-year basis. But looking ahead, advocates say people could run into big trouble because the terms of these hardship programs can be all over the map. “Credit cards, auto loans, installment loans, there are no federal guidelines,” says Aracely Panameño, a director at the nonprofit Center for Responsible Lending. She says when it comes time to make up for all those skipped payments, there are federal rules for repayment plans for home mortgages but not for many other types of loans. So she says lawmakers need to protect people. Otherwise, she says, lenders could make demands beyond what people can afford. “You must have a capacity to catch up with your payments in an affordable way,” Panameño says.

Read more …

Hard to believe the BLS is still paid for their reports.

Surprise: The BLS Admits Another Phony Jobs Report (Mish)

BLS Admits Another Error “In the household survey, individuals are classified as employed, unemployed, or not in the labor force based on their answers to a series of questions about their activities during the survey reference week (May 10th through May 16th). Workers who indicate they were not working during the entire survey reference week and expect to be recalled to their jobs should be classified as unemployed on temporary layoff. In May, a large number of persons were classified as unemployed on temporary layoff. However, there was also a large number of workers who were classified as employed but absent from work. As was the case in March and April, household survey interviewers were instructed to classify employed persons absent from work due to coronavirus-related business closures as unemployed on temporary layoff.”

“However, it is apparent that not all such workers were so classified. BLS and the Census Bureau are investigating why this misclassification error continues to occur and are taking additional steps to address the issue. If the workers who were recorded as employed but absent from work due to “other reasons” (over and above the number absent for other reasons in a typical May) had been classified as unemployed on temporary layoff, the overall unemployment rate would have been about 3 percentage points higher than reported (on a not seasonally adjusted basis). However, according to usual practice, the data from the household survey are accepted as recorded. To maintain data integrity, no ad hoc actions are taken to reclassify survey responses.”


Job Revisions The change in total nonfarm payroll employment for March was revised down by 492,000, from -881,000 to -1.4 million, and the change for April was revised down by 150,000, from -20.5 million to -20.7 million. With these revisions, employment in March and April combined was 642,000 lower than previously reported. [..] Total nonfarm payroll employment fell by 20.5 million in April, and the unemployment rate rose to 14.7 percent, the U.S. Bureau of Labor Statistics reported today.

The official unemployment rate is 13.3%. However, if you start counting all the people who want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6. U-6 is much higher at 21.2%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.

It’s important to put the jobs numbers into proper perspective. In the household survey, if you work as little as 1 hour a week, even selling trinkets on eBay, you are considered employed. In the household survey, if you work three part-time jobs, 12 hours each, the BLS considers you a full-time employee. In the payroll survey, three part-time jobs count as three jobs. The BLS attempts to factor this in, but they do not weed out duplicate Social Security numbers. The potential for double-counting jobs in the payroll survey is large.


The payroll survey (sometimes called the establishment survey) is the headline jobs number, generally released the first Friday of every month. It is based on employer reporting. The household survey is a phone survey conducted by the BLS. It measures unemployment and many other factors. If you work one hour, you are employed. If you don’t have a job and fail to look for one, you are not considered unemployed, rather, you drop out of the labor force. Looking for jobs on Monster does not count as “looking for a job”. You need an actual interview or send out a resume. These distortions artificially lower the unemployment rate, artificially boost full-time employment, and artificially increase the payroll jobs report every month.

Read more …

The article says “Biden said”. But we have seen 1000 times now that Biden is incapable of stringing more than 3 words together (one more time below).

So it’s not “Biden said”, but “Biden’s handlers said”.

Biden Clinches Nomination, Readies For Fall Showdown With Trump (JTN)

Former Vice President Joe Biden on Friday night officially clinched the Democratic nomination for president, setting up a fall showdown with President Trump. Biden secured enough delegates in Tuesday’s round of primaries to finish with 1,993, two more than needed to secure the nomination at the party’s convention in Milwaukee in August, The Associated Press announced. The former vice president and senator immediately issued a statement laying out his vision for the fall campaign.


“It was an honor to compete alongside one of the most talented groups of candidates the Democratic party has ever fielded — and I am proud to say that we are going into this general election a united party,” Biden said. “I am going to spend every day between now and November 3rd fighting to earn the votes of Americans all across this great country so that, together, we can win the battle for the soul of this nation, and make sure that as we rebuild our economy, everyone comes along.”

Read more …

A comment made after calling Trump a “divisive leader”. Biden trying for Hillary 2.0.

Biden: 10-15% of Americans Are ‘Not Very Good People’ (JTN)

Presumed Democratic presidential candidate Joe Biden says that 10-15% of Americans are “not very good people.”Biden made the comment late Thursday during an online campaign event that he was having with black supporters, moderated by actor Don Cheadle. The conversation centered on race relations in America in the wake of the death of George Floyd in police custody on Memorial Day.


The former vice president was explaining his belief that President Trump has been a divisive leader and that while “the vast majority” of Americans are honorable people, “there are probably anywhere from 10 to 15% of the people out there that are just not very good people.” Biden has been criticized for his tendency to make gaffes during public appearances. This comment, in particular, is reminiscent of Hillary Clinton’s widely panned statement on half of Trump supporters being a “basket of deplorables,” whose ideas and actions were “racist, sexist, homophobic, xenophobic, Islamophobic”.

Read more …

Life imitates Bizarro World.

Robert Mueller’s office deleted 19,000 text messages between Lisa Page and her lover Peter Strzok. Why?

Lisa Page Is The New National Security And Legal Analyst At NBC News (DC)

Former FBI lawyer Lisa Page is the new national security and legal analyst for NBC News and MSNBC, the network announced Friday. “We’re very happy to welcome to our network Lisa Page, former FBI lawyer who worked as special counsel for Robert Mueller’s legal team,” Nicolle Wallace said. “She worked on the Russian government disinformation probe and on the Hillary Clinton email investigation.” Page was discovered in 2017 to be having an affair with former FBI agent Peter Strzok, who worked on special counsel Robert Mueller’s investigation before he was removed for showing bias against President Donald Trump in text messages exchanged with Page.


Thousands of the lovers’ text messages, which were sent on agency-issued phones, were released by the Department of Justice (DOJ) and FBI in 2017. Page sued the DOJ and FBI for releasing her text messages, alleging that it was “illegal.” Page testified in July 2018 that the FBI did not see strong evidence of Russian collusion with President Donald Trump 10 months after beginning its investigation. She worked on the Mueller probe before evidence of her affair led to her dismissal from the team. Page spoke in an interview with The Daily Beast in December 2019, asserting that “there’s no fathomable way” she “committed any crime at all.”

Read more …

It’ll be a fun summer, but more bizarre than you’ve ever imagined.

Senate Approves 35 Subpoenas for Obama Administration Officials (NBC)

The Senate Homeland Security Committee on Thursday authorized the issuing of nearly three dozen subpoenas of Obama administration officials as part of Senate Republicans’ investigation into the origins of the FBI and special counsel probe into Russian interference in the 2016 election and the Trump campaign. The Judiciary Committee, meanwhile, met to consider more than 50 additional subpoenas, but postponed action until next week. Republicans on the panels are looking into flaws in FISA application process, the “unmasking” of Trump campaign and transition officials, including ex-national security adviser Michael Flynn, and the FBI’s investigation of the Trump campaign more broadly — actions that President Donald Trump has collectively dubbed “Obamagate” and dismissed as a “hoax” and a “witch hunt.”


[..] The Homeland Security and Judiciary committees are considering issuing subpoenas for former CIA Director John Brennan, ex-Director of National Intelligence James Clapper, former FBI Director James Comey, former Obama chief of staff Dennis McDonough, former national security adviser Susan Rice and ex-FBI officials Peter Strzok and Lisa Page. The Judiciary panel is also considering subpoenas for current FBI Director Christopher Wray and former Justice Department officials, including former Attorney General Loretta Lynch and ex-FBI Deputy Director Andrew McCabe. Judiciary member Ted Cruz, R-Texas, asked Democrats on the panel to consider how they would feel if the situation were reversed and the Trump administration were looking into the former Vice President Joe Biden’s presidential campaign.

Read more …

“..if the United States wants to survive the onslaught of socialism..

Letter From Lt. Gen. Michael T. Flynn, ‘I Am Not Done’ (SAC)

Former National Security Advisor Lt. Gen. Michael T. Flynn, who has been fighting the courts to have his case thrown out, said “I am not done’ in an email to a journalist that was posted Friday on Twitter that “I am not done.” Flynn’s inference is important, as evidence discovered this year by the Justice Department has revealed that the three star general was allegedly set up by bureau agents investigating President Donald Trump’s 2016 campaign and their debunked theory that the campaign conspired with Russia. The Justice Department asked the court last month to drop the charges against Flynn and people from all across the country are fighting on his behalf. Flynn hasn’t spoken publicly in years. In fact, the first time people heard from the three star general was when he withdrew his guilty plea months ago, through his lawyer, Sidney Powell.


“This letter means that Lt. Gen. Flynn has not given up on the country and neither should you,” a very close friend of Flynn’s told me on Friday. The friend said it was in response to the growing unrest in the country and a warning that Americans need to be involved in the political process. He wrote the email to Scott Kesterson, a documentary filmmaker and journalist that spent 3 and half years in Afghanistan. Flynn warned ‘if the United States wants to survive the onslaught of socialism, if we are to continue to enjoy self-government, to secure the God-given individual blessings of liberty for ourselves, for our families, then good Americans must accept that each has a moral obligation to participate in the political life of our country.”

Read more …

 

 

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Mar 192020
 


DPC Cab stand at Madison Square, NY c1900

 

‘A Generation Has Died’ (G.)
Scientists Say Mass Tests In Italian Town Have Halted COVID-19 (G.)
Japanese Flu Drug ‘Clearly Effective’ Against Coronavirus, But.. (G.)
UK Failures Over COVID-19 Will Increase Death Toll, Says Leading Doctor (G.)
Asian Nations Face Second Wave Of Imported Cases (BBC)
Dollar Resumes Ascent As Investors Panic, Scramble For Cash (R.)
Cash Is King As Emergency Stimulus Fails To Stop Market Panic (R.)
Misunderestimate: Banks Are Going To Drown In An Ocean Of Defaults (Black)
Airline Industry Turmoil Deepens As Coronavirus Pain Spreads (R.)
The COVID-19 Crisis Is A Chance To Do Capitalism Differently (Mazzucato)
Russia Coronavirus Disinformation Designed To Sow Panic In West – EU (R.)
‘Putin’s Chef’ Threatens To Sue US Over Charges Of 2016 Election Meddling (G.)
Ghislaine Maxwell Sues Jeffrey Epstein’s Estate Over Legal Fees (BBC)

 

 

 

Cases 221,934 (+ 19,664 from yesterday’s 202,270)

Deaths 8,999 (+ 987 from yesterday’s 8,012)

 

From Worldometer yesterday evening (before their day’s close)

 

 

From Worldometer -NOTE: mortality rate briefly touched 10% –

 

 

From SCMP: (Note: the SCMP graph was useful when China was the focal point; they are falling behind now)

 

 

From COVID2019.app: (New format lacks new cases and deaths)

 

 

I wanted to show you how widespread the virus has become. Worldometer keeps a constantly updated record of new cases and deaths every day. Here is the harvest of just the past 10 hours; I left out the sources, go to their site for those.

• 1 new case in Sweden
• 5 new cases in Sri Lanka
309 new cases and 7 new deaths in Belgium
• 12 new cases in Bahrain
• 35 new cases in Norway
756 new cases and 3 new deaths in Germany
• 10 new cases in Tunisia
• 245 new cases and 2 new deaths in Spain
• 10 new cases in Peru
• 22 new cases in Pakistan
• 12 new cases in Armenia
• 104 new cases and 2 new deaths in Switzerland
• 2 new cases in Lithuania:
• 28 new cases in Finland
• 3 new cases in Tanzania
• 3 new cases in the State of Palestine
• 4 new cases in Bangladesh
• 4 new cases in Guam
• 5 new cases in Brunei Darussalam
• 1 new death in Greece
• 13 new cases and 1 new death in Croatia
• 4 new cases in Morocco
• 6 new cases in Bosnia and Herzegovina
• 15 new cases in the Philippines
• 7 new cases and 1 new death in Algeria
75 new cases and 2 new deaths in Denmark
• 2 new cases in Ghana
113 new cases in Australia (NSW), including a 6-year-old child
• 6 new cases in Slovakia
• 7 new cases in the DR Congo
• 6 new cases in Lebanon
96 new cases in Israel
• 132 new cases and 2 new deaths in Luxembourg

• 15 new cases in Latvia
• 50 new cases in Czechia
1st death in Russia
• 110 new cases in Malaysia

• 14 new cases in Faeroe Islands
• 6 new cases in Kuwait
• 1 new case in Cuba: a Canadian citizen
60 new cases in Thailand
• 82 new cases and 6 new deaths in Indonesia

• 18 new cases in Poland
• 8 new cases in Kazakhstan
1st death in Mexico
• 197 new cases and 1 new death in Austria

• 3 new cases in Bangladesh
• 8 new cases in Serbia
• 2 new cases in Sri Lanka
• 5 new cases in India
• 15 new cases in Hungary
• 2 new cases in Georgia
• 8 new cases in Taiwan
• 2 new cases and 1 new death in Bulgaria
• 5 new cases in Uzbekistan
• 5 new cases in Armenia
205 new cases and 5 new deaths in the United States
• 9 new cases and 3 new deaths in Japan
• 3 new cases in Honduras
• 2 new cases in Trinidad and Tobago
• 1 new case in French Polynesia
• 1 new death in Argentina
1st case in Nicaragua
• 1st case in El Salvador
• 1st case in Fiji

• 1 new death in Curaçao.
• 9 new cases in Colombia
152 new cases and 7 new deaths in South Korea
• 8 new cases in New Zealand
• 34 new cases, 8 new deaths (all in Hubei) in China

 

 

Time to wonder about mental health as well.

‘A Generation Has Died’ (G.)

Coffins awaiting burial are lining up in churches and the corpses of those who died at home are being kept in sealed-off rooms for days as funeral services struggle to cope in Bergamo, the Italian province hardest hit by the coronavirus pandemic. As of Wednesday, Covid-19 had killed 2,978 across Italy, all buried or cremated without ceremony. Those who die in hospital do so alone, with their belongings left in bags beside coffins before being collected by funeral workers. In Bergamo, a province of 1.2 million people in the Lombardy region, where 1,640 of the total deaths in the country have taken place, 3,993 people had contracted the virus by Tuesday. The death toll across the province is unclear, but CFB, the area’s largest funeral director, has carried out almost 600 burials or cremations since 1 March.

“In a normal month we would do about 120,” said Antonio Ricciardi, the president of CFB. “A generation has died in just over two weeks. We’ve never seen anything like this and it just makes you cry.” There are about 80 funeral companies across Bergamo, each receiving dozens of calls an hour. A shortage of coffins as providers struggle to keep up with demand and funeral workers becoming infected with the virus are also hampering preparations. Hospitals have adopted more stringent rules regarding the handling of the dead, who need to be placed in a coffin straight away without being clothed due to the risk of infection posed by their bodies. “Families can’t see their loved ones or give them a proper funeral, this is a big problem on a psychological level,” said Ricciardi. “But also because many of our staff are ill, we don’t have as many people to transport and prepare the bodies.”

For those who die at home, the bureaucratic process is lengthier as deaths need to be certified by two doctors. The second is a specialist who would ordinarily have to certify the death no later than 30 hours after a person has passed away. “So you have to wait for both doctors to come and at this time, many of them are also ill,” added Ricciardi. Stella, a teacher in Bergamo, shared the story of one of the deceased with the Guardian. “Yesterday, an 88-year-old man died,” she said. “He’d had a fever for a few days. There was no way to call an ambulance because the line was always busy. He died alone in his room. The ambulance arrived an hour later. Obviously, nothing could be done. And since no coffins were available in Bergamo, they left him on the bed and sealed his room to keep his relatives from entering until a coffin could be found.”

Adding to the torment is the fact that relatives cannot visit their loved ones in hospital, or give them proper funerals. “Usually you would be able to dress them and they would stay one night in the family home. None of this is happening,” said Alessandro, whose 74-year-old uncle died in Codogno, the Lombardy town where the outbreak began. “You can’t even see them to say goodbye, this is the most devastating part.” The harrowing impact of the virus on Bergamo can be gleaned from the obituary section of the local newspaper L’Eco di Bergamo. On Friday, reader Giovanni Locatelli shared online footage comparing the newspaper’s obituary section on 9 February, when listings took up just one page, to a copy dated 13 March, when 10 pages were needed to commemorate the dead.

Read more …

Test? Where do I get one?

Scientists Say Mass Tests In Italian Town Have Halted COVID-19 (G.)

The small town of Vò, in northern Italy, where the first coronavirus death occurred in the country, has become a case study that demonstrates how scientists might neutralise the spread of Covid-19. A scientific study, rolled out by the University of Padua, with the help of the Veneto Region and the Red Cross, consisted of testing all 3,300 inhabitants of the town, including asymptomatic people. The goal was to study the natural history of the virus, the transmission dynamics and the categories at risk. The researchers explained they had tested the inhabitants twice and that the study led to the discovery of the decisive role in the spread of the coronavirus epidemic of asymptomatic people.

When the study began, on 6 March, there were at least 90 infected in Vò. For days now, there have been no new cases. “We were able to contain the outbreak here, because we identified and eliminated the ‘submerged’ infections and isolated them,” Andrea Crisanti, an infections expert at Imperial College London, who took part in the Vò project, told the Financial Times. “That is what makes the difference.” The research allowed for the identification of at least six asymptomatic people who tested positive for Covid-19. ‘‘If these people had not been discovered,” said the researchers, they would probably have unknowingly infected other inhabitants.

“The percentage of infected people, even if asymptomatic, in the population is very high,” wrote Sergio Romagnani, professor of clinical immunology at the University of Florence, in a letter to the authorities. “The isolation of asymptomatics is essential to be able to control the spread of the virus and the severity of the disease.” [..] the problems of mass tests are not only of an economic nature (each swab costs about 15 euros) but also at a organisational level. [..] Massimo Galli, professor of infectious diseases at the University of Milan and director of infectious diseases at the Luigi Sacco hospital in Milan, warned carrying out mass tests on the asymptomatic population could however prove to be useless. “The contagions are unfortunately constantly evolving,” Galli told the Guardian. “A man who tests negative today could contract the disease tomorrow.”

Read more …

Every day brings new stories of miracles. And then you read them.

Japanese Flu Drug ‘Clearly Effective’ Against Coronavirus, But.. (G.)

Medical authorities in China have said a drug used in Japan to treat new strains of influenza appeared to be effective in coronavirus patients, Japanese media said on Wednesday. Zhang Xinmin, an official at China’s science and technology ministry, said favipiravir, developed by a subsidiary of Fujifilm, had produced encouraging outcomes in clinical trials in Wuhan and Shenzhen involving 340 patients. “It has a high degree of safety and is clearly effective in treatment,” Zhang told reporters on Tuesday. Patients who were given the medicine in Shenzhen turned negative for the virus after a median of four days after becoming positive, compared with a median of 11 days for those who were not treated with the drug, public broadcaster NHK said.


In addition, X-rays confirmed improvements in lung condition in about 91% of the patients who were treated with favipiravir, compared to 62% or those without the drug. Fujifilm Toyama Chemical, which developed the drug – also known as Avigan – in 2014, has declined to comment on the claims. Shares in the firm surged on Wednesday following Zhang’s comments, closing the morning up 14.7% at 5,207 yen, having briefly hit their daily limit high of 5,238 yen. Doctors in Japan are using the same drug in clinical studies on coronavirus patients with mild to moderate symptoms, hoping it will prevent the virus from multiplying in patients. But a Japanese health ministry source suggested the drug was not as effective in people with more severe symptoms. “We’ve given Avigan to 70 to 80 people, but it doesn’t seem to work that well when the virus has already multiplied,” the source told the Mainichi Shimbun.

Read more …

Not the first time we mention Richard Horton, editor-in-chief of the Lancet.

UK Failures Over COVID-19 Will Increase Death Toll, Says Leading Doctor (G.)

A “collective failure” to appreciate the enormity of the coronavirus pandemic and enact swift measures to protect the public will lead to unnecessary deaths, according to a leading doctor, who said the UK ignored clear warning signs from China. Richard Horton, editor-in-chief of the Lancet, rounded on politicians and their expert advisers for failing to act when Chinese researchers first warned about a devastating new virus that was killing people in Hubei eight weeks ago. The team from Wuhan and Beijing reported in January that “the number of deaths was rising quickly” as the virus spread in China. They urged the global community to launch “careful surveillance” in view of the pathogen’s “pandemic potential”.


But writing in the Guardian, Horton said the warning was met with complacency in Britain, where for unknown reasons, medical and scientific advisers watched and waited. At the time, scientists advising ministers appeared to believe it could be treated like influenza, and that a “controlled epidemic” would generate “herd immunity” that would help protect the most vulnerable against the infection. The scenario called for upwards of 60% of the population to contract the virus. The government’s strategy changed dramatically on Monday when the prime minister announced that new modelling from Imperial College London demonstrated that more draconian measures were needed to slash the estimated death toll from 260,000 to about 20,000. Without those measures, which have transformed society, the NHS would be overwhelmed, leading to a situation that has driven a brutal death toll in Italy.

Read more …

Excuse me, but why do they let it happen? Once you’ve been through Wave 1, shouldn’t you know better than to let people travel abroad and come back?

Asian Nations Face Second Wave Of Imported Cases (BBC)

South Korea, China and Singapore are among the Asian countries facing a second coronavirus wave, spurred by people importing it from outside. China, where the virus first emerged, reported no new domestic cases on Thursday for the first time since it started recording numbers in January. But it reported 34 new cases among people recently returned to China. South Korea saw a jump in new cases on Thursday with 152, though it is not clear how many were imported. A new cluster there is centred on a nursing home in Daegu, where 74 patients have tested positive. On Wednesday, Singapore reported 47 new infections – of which 33 were imported, including 30 residents who had been infected abroad and brought the infection back.


In China, there were eight more deaths, all in the central province of Hubei and most of them in Wuhan. All three countries had been showing success in controlling domestic cases, but there is concern that increases elsewhere could unravel their progress. Much of the focus has now shifted to Europe and the US, but the new numbers signal that the outbreak is far from over in Asia. Malaysia’s senior health office on Wednesday begged people to “stay at home and protect yourself and your family. Please”. The country has tallied 710 people with the virus, many of them linked to one religious event in the capital, Kuala Lumpur, in February. “We have a slim chance to break the chain of COVID-19 infections,” Noor Hisham Abdullah, director general of Health Malaysia, said on Facebook. “Failure is not an option here. If not, we may face a third wave of this virus, which would be greater than a tsunami, if we maintain a ‘so what’ attitude.”

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Far as I can see, the dollar sold of a lot recently. But now people need dollars to pay off their losses.

Dollar Resumes Ascent As Investors Panic, Scramble For Cash (R.)

The dollar resumed its relentless climb against major currencies on Thursday as wild financial market volatility and worries over tightening liquidity triggered by the coronavirus pandemic sparked an investor flight into cash. Sterling teetered near the lowest since at least 1985 against the greenback. The Australian dollar skidded to a 17-year low, while the New Zealand dollar crashed to an 11-year low as investors dumped riskier assets. The euro briefly rose against the dollar and the pound after the European Central Bank announced a €750 billion asset-purchase programme in response to the coronavirus outbreak, but even this effort was overwhelmed by a stampede into the dollar.


Investors are selling what they can to keep their money in dollars due to the unprecedented amount of uncertainty caused by the virus epidemic, which threatens to paralyse large swaths of the global economy. “This is similar to what happened during the global financial crisis in that investors are even selling what are normally considered safe-haven assets,” said Junichi Ishikawa, senior foreign exchange strategist at IG Securities in Tokyo. “The logic is the biggest hedge against risk is holding your money in cash, so the dollar is being bought. Investor uncertainty is about as high as it can get.” [..] In some cases investors are unloading Treasuries and gold in order to keep their money in dollars. This has confounded many analysts because investors normally buy government debt and precious metals during times of uncertainty.

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Same as above. “We’re in this phase where investors are just looking to liquidate their positions..” We’re in the phase where they have to pay their gambling debts. “Investor” just sounds better than “gamblig addict”.

Cash Is King As Emergency Stimulus Fails To Stop Market Panic (R.)

The dollar surged and everything else was blown away on Thursday as emergency central bank measures in Europe, the United States and Australia failed to halt a fresh wave of panic selling. “There’s no buyers, there’s not much liquidity and everyone is just getting out,” said Chris Weston, head of research at Melbourne brokerage Pepperstone. Stocks, bonds, gold and commodities fell as the world struggles to contain coronavirus and investors and businesses scramble for hard cash. U.S. stock futures were a hair’s breadth from hitting session down limits. The growth-sensitive Australian dollar was crushed 4% to a more than 17-year low. Nearly every stock market in Asia was down and circuit breakers were hit in Seoul, Jakarta and Manila.

Traders reported huge strains in bond markets as distressed funds sold any liquid asset to cover losses in stocks and redemptions from investors. Benchmark 10-year sovereign bond yields in Australia, New Zealand, Malaysia, Korea and Singapore and Thailand surged as prices tumbled. Gold fell 1% and copper hit its downlimit in Shanghai. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 5% to a four-year low, with Korea and Hong Kong leading losses. The Nikkei fell nearly 1%, the ASX 200 nearly 3%, while the Kospi lost 8% and the Hang Seng 5%. “We’re in this phase where investors are just looking to liquidate their positions,” said Prashant Newnaha, senior interest rate strategist at TD Securities in Singapore.

[..] J.P. Morgan economists forecast the U.S. economy to shrink 14% in the next quarter, and the Chinese economy to drop more than 40% in the current one, one of the most dire calls yet as to the scale of the fallout. “There is no longer doubt that the longest global expansion on record will end this quarter,” they said in a note. “The key outlook issue now is gauging the depth and the duration of the 2020 recession.”

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We could all write this by now.

Misunderestimate: Banks Are Going To Drown In An Ocean Of Defaults (Black)

On November 6, 2000, then US presidential candidate George W. Bush told a crowd of cheering supporters, “they misunderestimated me.” [..] ‘Misunderestimate’ seems to be a conflation of the words ‘misunderstand’ and ‘underestimate’. And while that was utterly hysterical 20 years ago when Bush first said it, ‘misunderestimate’ may be the most appropriate word of today. The entire world has completely ‘misunderestimated’ the Corona Virus. Banks are about to drown in an ocean of defaults. I’ll talk about this a lot more in the coming days, but briefly:

• There’s $250 TRILLION in global debt right now– mortgages, credit card debt, business loans, government debt, etc.
• And banks own a large portion of that debt.
• This virus crisis is going to trigger a wave of defaults from consumers, businesses, and even governments.
• Think about it: tourism alone makes up 10% of global GDP. Revenue in that entire sector– hotels, airlines, cruise ships, etc. has collapsed, and many of those companies aren’t going to survive.
• The crash in oil prices is going to wipe out countless oil companies.
• Many large retail chains, which were already struggling in the age of e-commerce, will likely declare bankruptcy.
• Countless businesses around the world have ‘temporarily’ closed due to public health policies, and many of them will go out of business entirely.
• MOST of these businesses owe lots of money to the banks, whether it’s a small business working line, or the $34 billion in debt that American Airlines owes. So the defaults are going to be massive.
• On top of that, millions of people are going to lose their jobs and be unable to make payments on their credit card debt, auto loans, and even mortgages.
• Again, there’s $250 trillion in global debt right now. Total bank capital worldwide is less than $10 trillion.
• So if the coming defaults trigger a mere 4% loss in total debt, it will exceed the entirety of global bank capital.
• And this doesn’t even take into consideration the impact of the $1 QUADRILLION derivatives exposure.

Misunderestimate? Absolutely.

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Why save something so bloated?

Airline Industry Turmoil Deepens As Coronavirus Pain Spreads (R.)

Airline industry turmoil deepened on Thursday as Qantas told most of its 30,000 employees to take leave and India prepared a rescue package of up to $1.6 billion to aid carriers battered by coronavirus, government sources said. The U.N.’s International Civil Aviation Organization called on governments to ensure cargo operations were not disrupted to maintain the availability of critical medicine and equipment such as ventilators, masks, and other health and hygiene items that will help reduce the spread of the coronavirus pandemic. Passenger operations have collapsed at an unprecedented rate as the virus spreads around the world, with Delta Air parking more than 600 jets, cutting corporate pay by as much as 50%, and scaling back its flying by more than 70% until demand begins to recover.

Shares in U.S. airlines fell sharply on Wednesday after Washington proposed a rescue package of $50 billion in loans, but no grants as the industry had requested, to help address the financial impact from the deepening coronavirus crisis. The Trump administration’s lending proposal would require airlines to maintain a certain amount of service and limit increases in executive compensation until the loans are repaid. American Airlines in a memo to staff rebuffed criticism that it had rewarded its shareholders with too many dividends and stock buybacks in better times, leaving it with less cash to manage the crisis. “Unfortunately, this is no ordinary rainy day,” said Nate Gatten, American’s senior vice president global government affairs. “These are extraordinary circumstances, and additional support is necessary to protect jobs and ensure that the flying public can continue to rely on our industry after the crisis ends.”

[..] Air Canada said it was gradually suspending the majority of its international and U.S. transborder flights by March 31. India is poised to join a growing list of countries offering aid to its aviation industry. The Finance Ministry is considering a proposal worth up to $1.6 billion that includes temporary suspension of most taxes levied on the sector, according to two government sources who have direct knowledge of the matter. New Zealand on Thursday outlined the first tranche of a NZ$600 million ($344 million) aviation relief package, including financial support for airlines to pay government passenger charges and cover air traffic control fees.

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Mariana Mazzucato is professor of economics at University College London.

I understand the temptation to theorize and wax enthusiastically about underlying systems, but isn’t it more useful to talk about how we can have 1 million tests per day by tomorrow morning?

The COVID-19 Crisis Is A Chance To Do Capitalism Differently (Mazzucato)

Since the 1980s, governments have been told to take a back seat and let business steer and create wealth, intervening only for the purpose of fixing problems when they arise. The result is that governments are not always properly prepared and equipped to deal with crises such as Covid-19 or the climate emergency. By assuming that governments have to wait until the occurrence of a huge systemic shock before they resolve to take action, insufficient preparations are made along the way. In the process, critical institutions providing public services and public goods more widely – such as the NHS in the UK, where there have been cuts to public health totalling £1bn since 2015 – are left weakened.

The prominent role of business in public life has also led to a loss of confidence in what the government can achieve alone – leading in turn to the many problematic public-private partnerships, which prioritise the interests of business over the public good. For example, it has been well documented that public-private partnerships in research and development often favour “blockbusters” at the expense of less commercially appealing medicines that are hugely important to public health, including antibiotics and vaccines for a number of diseases with outbreak potential. On top of this, there is a lack of a safety net and protection for working people in societies with rising inequality, especially for those working in the gig economy with no social protection.

But we now have an opportunity to use this crisis as a way to understand how to do capitalism differently. This requires a rethink of what governments are for: rather than simply fixing market failures when they arise, they should move towards actively shaping and creating markets that deliver sustainable and inclusive growth. They should also ensure that partnerships with business involving government funds are driven by public interest, not profit. First of all, governments must invest in, and in some cases create, institutions that help to prevent crises, and make us more capable to handle them when they arise. The UK government’s emergency budget of £12bn for the NHS is a welcome move. But equally important is a focus on long-term investment to strengthen health systems, reversing the trends of recent years.

Second, governments need to better coordinate research and development activities, steering them towards public health goals. Discovery of vaccines will necessitate international coordination on a herculean scale, exemplified by the extraordinary work of the Coalition for Epidemic Preparedness Innovations (CEPI).

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Unbelievable. More harmful than the virus. Or rather a virus in itself, one that kills slowly.

Russia Coronavirus Disinformation Designed To Sow Panic In West – EU (R.)

Russian media have deployed a “significant disinformation campaign” against the West to worsen the impact of the coronavirus, generate panic and sow distrust, according to a European Union document seen by Reuters. The Kremlin denied the allegations on Wednesday, saying they were unfounded and lacked common sense. The EU document said the Russian campaign, pushing fake news online in English, Spanish, Italian, German and French, uses contradictory, confusing and malicious reports to make it harder for the EU to communicate its response to the pandemic. “A significant disinformation campaign by Russian state media and pro-Kremlin outlets regarding COVID-19 is ongoing,” said the nine-page internal document, dated March 16…

“The overarching aim of Kremlin disinformation is to aggravate the public health crisis in Western countries…in line with the Kremlin’s broader strategy of attempting to subvert European societies,” the document produced by the EU’s foreign policy arm, the European External Action Service, said. An EU database has recorded almost 80 cases of disinformation about coronavirus since Jan. 22, it said, noting Russian efforts to amplify Iranian accusations online, cited without evidence, that coronavirus was a U.S. biological weapon. Most scientists believe the disease originated in bats in China before passing to humans. Kremlin spokesman Dmitry Peskov pointed to what he said was the lack in the EU document of a specific example or link to a specific media outlet.

“We’re talking again about some unfounded allegations which in the current situation are probably the result of an anti-Russian obsession,” said Peskov. The EU document cited examples from Lithuania to Ukraine, including false claims that a U.S. soldier deployed to Lithuania was infected and hospitalized. It said that on social media, Russian state-funded, Spanish-language RT Spanish was the 12th most popular news source on coronavirus between January and mid-March, based on the amount of news shared on social media. The European Commission said it was in contact with Google, Facebook, Twitter and Microsoft. An EU spokesman accused Moscow of “playing with people’s lives” and appealed to EU citizens to “be very careful” and only use news sources they trust.

[..] Russian media in Europe have not been successful in reaching the broader public, but provide a platform for anti-EU populists and polarize debate, analysis by EU and non-governmental groups has shown. The EEAS report cited riots at the end of February in Ukraine, a former Soviet republic now seeking to join the EU and NATO, as an example of the consequences of such disinformation. It said a fake letter purporting to be from the Ukrainian health ministry falsely stated here were five coronavirus cases in the country. Ukrainian authorities say the letter was created outside Ukraine, the EU report said. “Pro-Kremlin disinformation messages advance a narrative that coronavirus is a human creation, weaponized by the West,” said the report, first cited by the Financial Times.

It quoted fake news created by Russia in Italy – which is suffering the world’s second most deadly outbreak of coronavirus – alleging that the 27-nation EU was unable to effectively deal with the pandemic, despite a series of collective measures taken by governments in recent days.

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$50 billion.

‘Putin’s Chef’ Threatens To Sue US Over Charges Of 2016 Election Meddling (G.)

A businessmen allied with Vladimir Putin has said he will sue the US for $50bn (£41bn) in damages after prosecutors dropped charges of meddling in the 2016 elections. Yevgeny Prigozhin, often dubbed “Putin’s chef,” claimed in a statement on Tuesday that he had been “wrongfully persecuted” by US prosecutors who said his company Concord had funded an internet troll factory that had promoted Donald Trump’s candidacy during the US elections. The charges, which were filed by special counsel Robert Mueller following his nearly two-year investigation into Russian meddling, were abruptly dropped on Monday, a month before trial. Prosecutors said the Russian company had “no exposure to meaningful punishment” and that the prosecution risked exposing investigative sources and methods.


A day later, Prigozhin went on the attack, saying the dropped charges showed that the US government “feared publicity and just court proceedings”. “This means that the allegations that ‘Prigozhin interfered in the US presidential election,’ ‘Concord interfered in the US presidential election,’ or ‘Russia interfered in the US presidential election’ are mendacious and false,” said Prigozhin, according to the statement released by his company. Prosecutors had previously complained that documents they had provided to the defence had ended up online, and had been hesitant to deliver more sensitive information to Concord’s defence team. It is not clear whether the plans to file a lawsuit are serious, where the lawsuit will be filed, and why Prigozhin values the damages against him at $50bn. The company’s press office declined to give any more information about Prigozhin’s plans on Tuesday.

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Threats on her life. But not from the FBI.

Ghislaine Maxwell Sues Jeffrey Epstein’s Estate Over Legal Fees (BBC)

Ghislaine Maxwell, the former girlfriend of Jeffrey Epstein, is suing the late US financier’s estate seeking reimbursement for legal fees and security costs, court documents say. Ms Maxwell’s complaint states that she “had no involvement in or knowledge of Epstein’s alleged misconduct” and that he had promised to cover her costs. She also “receives regular threats to her life and safety”, it adds. [..] Ms Maxwell, a long-time friend of Epstein, has not been accused by the authorities of wrongdoing. Ms Maxwell’s lawsuit, which is dated 12 March but was made public on Wednesday, claims that “extensive global coverage” of the investigation resulted in her having to “hire personal security and find safe accommodation”. It adds that she “formed a legal and special relationship” with Epstein that obligated the estate to compensate her, and that “assurances” were made but later ignored after she filed a reimbursement claim in November.

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May 262018
 


Louise Dahl-Wolfe Looking at Matisse, Museum of Modern Art 1939

 

S&P 500 Companies Return $1 Trillion To Shareholders In Tax-Cut Surge (R.)
The 2020s Might Be The Worst Decade In US History (Mauldin)
Moody’s Warns Of ‘Particularly Large’ Wave Of Junk Bond Defaults Ahead (CNBC)
Moody’s Puts Italy On Downgrade Review, Junk Rating Possible (ZH)
UK Economy Posts Worst Quarterly GDP Figures For Five Years (G.)
Prospects of US-North Korea Summit Brighten (R.)
The Real ‘Constitutional Crisis’ (Strassel)
A Mendacious Exercise In Manufacturing Paranoia (Jim Kunstler)
Tesla Seeks To Dismiss Securities Fraud Lawsuit (R.)
Madrid Takes Its Car Ban to the Next Level (CityLab)

 

 

Oh, that’s what the tax cuts are for?!

S&P 500 Companies Return $1 Trillion To Shareholders In Tax-Cut Surge (R.)

S&P 500 companies have returned a record $1 trillion to shareholders over the past year, helped by a recent surge in dividends and stock buybacks following sweeping corporate tax cuts introduced by Republicans, a report on Friday showed. In the 12 months through March, S&P 500 companies paid out $428 billion in dividends and bought up $573 billion of their own shares, according to S&P Dow Jones Indices analyst Howard Silverblatt. That compares to combined dividends and buybacks worth $939 billion during the year through March 2017, Silverblatt said in a research note. Earnings per share of S&P 500 companies surged 26 percent in the March quarter, boosted by the Tax Cuts and Jobs Act passed by Republican lawmakers in December.

Companies have been returning much of that profit windfall to shareholders via share buybacks and increased dividends at never before seen amounts, highlighted by Apple’s record $23.5 billion worth of shares repurchased in the first quarter. S&P 500 companies have also plowed some of the windfall from lower taxes into investments toward growth or becoming more efficient. First-quarter capital expenditures totaled at least $159 billion, up more than 21 percent from the year before, according to S&P Dow Jones Indices. The biggest overhaul of the U.S. tax code in over 30 years, the new law slashes the corporate income tax rate to 21 percent from 35 percent, and charges multinationals a one-time tax on profits held overseas.

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Mauldin turns dark side.

The 2020s Might Be The Worst Decade In US History (Mauldin)

I recently wrote about a looming credit crisis that’s stemming from high-yield junk bonds. The crisis itself will have massive consequences for investors. But that’s not the worst part. The crisis will create a domino effect and trigger global financial contagion, which I usually refer to as “The Great Reset.” The collapse of high-yield bonds will hit stocks and bonds. Rising defaults will force banks to reduce their lending exposure, drying up capital for previously creditworthy businesses. This will put pressure on earnings and reduce economic activity. A recession will follow. This will not be just a U.S. headache, either. It will surely spill over into Europe (and may even start there) and then into the rest of the world.

The U.S. and/or European recession will become a global recession, as happened in 2008. Europe has its own set of economic woes and multiple potential triggers. It is quite possible Europe will be in recession before the ECB finishes this tightening cycle. As always, a U.S. recession will spark higher federal spending and reduce tax revenue. So I expect the on-budget deficit to quickly reach $2 trillion or more. Within four years of the recession’s onset, total government debt will be at least $30 trillion. This will further constrain the private capital markets and likely raise tax burdens for everyone—not just the rich.

Meanwhile, job automation will intensify, with businesses desperate to cut costs. The effect we already see on labor markets will double or triple. Worse, it will start reaching deep into the service sector. The technology is improving fast. The working-class population will not like this and it has the power to vote. “Safety net” programs and unemployment benefit expenditures will skyrocket. Studies show that the ratio of workers covered by unemployment insurance is at its lowest level in 45 years. What happens when millions of freelancers lose their incomes?

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We’re talking trillions. Poof!

Moody’s Warns Of ‘Particularly Large’ Wave Of Junk Bond Defaults Ahead (CNBC)

With corporate debt hitting its highest levels since before the financial crisis, Moody’s is warning that substantial trouble is ahead for junk bonds when the next downturn hits. The ratings agency said low interest rates and investor appetite for yield has pushed companies into issuing mounds of debt that offer comparatively low levels of protection for investors. While the near-term outlook for credit is “benign,” that won’t be the case when economic conditions worsen. The “prolonged environment of low growth and low interest rates has been a catalyst for striking changes in nonfinancial corporate credit quality,” Mariarosa Verde, Moody’s senior credit officer, said in a report.

“The record number of highly leveraged companies has set the stage for a particularly large wave of defaults when the next period of broad economic stress eventually arrives.” Though the current default rate is just 3 percent for speculative-grade credit, that has been predicated on favorable conditions that may not last. Since 2009, the level of global nonfinancial companies rated as speculative, or junk, has surged by 58 percent, to the highest ever, with 40 percent rated B1 or lower, the point that Moody’s considers “highly speculative,” as opposed to “non-investment grade speculative.” In dollar terms, that translates to $3.7 trillion in total junk debt outstanding, $2 trillion of which is in the B1 or lower category.

“Strong investor demand for higher yields continues to allow all but the weakest issuers to avoid default by refinancing maturing debt,” Verde wrote. “A number of very weak issuers are living on borrowed time while benign conditions last.” The level of speculative-grade issuance peaked in the U.S. in 2013, at $334.5 billion, according to the Securities Industry and Financial Markets Association. American companies have $8.8 trillion in total outstanding debt, a 49 percent increase since the Great Recession ended in 2009.

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President Mattarella has refused to accept the nominee for finance minister, Savona. He’s a euroskeptic.

Meanwhile, if Italian bonds are downgraded further, Europe has a massive problem.

Moody’s Puts Italy On Downgrade Review, Junk Rating Possible (ZH)

In a quite direct ‘threat’ to the newly formed Italian coalition, Moody’s warned that Italy will face a downgrade from its current Baa2 rating (potentially more than one notch to junk status) due to the lack of fiscal restraint in the new “contract” and the potential for delays to Italy’s structural reforms. While Italy’s current rating is Baa2, and a downgrade would leave it at Baa3 (still investment grade), one look at Italian debt markets this week and one can be forgiven for thinking it is pricing in a multiple-notch downgrade to junk… and thus potentially making things awkward for its ECB bond-buying-benefactor and its banking system’s massive holdings of sovereign bonds.

Full Moody’s Report: Moody’s Investors Service has today placed the Government of Italy’s ratings on review for possible downgrade. Ratings placed under review are the Baa2 long-term issuer and senior unsecured bond ratings as well as the (P) Baa2 medium-term MTN programme, the (P)Baa2 senior unsecured shelf, the Commercial Paper and other short-term ratings of Prime-2/(P) Prime-2 respectively. The key drivers for today’s initiation of the review for downgrade are as follows: 1. The significant risk of a material weakening in Italy’s fiscal strength, given the fiscal plans of the new coalition government; and 2. The risk that the structural reform effort stalls, and that past reforms such as the pension reforms implemented in 2011 are reversed.

Moody’s will use the review period to assess the impact of the fiscal and economic policy platform of the new government on Italy’s credit profile, with a particular focus on the effect on the deficit and debt trajectories in the coming years. The review will also allow Moody’s to assess further whether the new government intends to continue to pursue growth-enhancing structural reforms, or conversely to reverse earlier reforms, such as the 2011 pension reform, as well as other economic policy initiatives in the coming months that may have an incidence on the country’s growth potential over the coming years.

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What do you mean we can’t blame the weather?

UK Economy Posts Worst Quarterly GDP Figures For Five Years (G.)

The weakest household spending for three years and falling levels of business investment dragged the economy to the worst quarter for five years, official statisticians have said. The Office for National Statistics confirmed its previous estimate that GDP growth slumped to 0.1% in the first quarter, while sticking to its view that the “beast from the east” had little impact. The latest figures will further stoke concerns over the strength of the UK economy, amid increasing signals for deteriorating growth as Britain prepares to leave the EU next year. Some economists, including officials at the Bank of England, thought the growth rate would be revised higher as more data became available.

Threadneedle Street delayed raising interest rates earlier this month after the weak first GDP estimate, despite arguing that the negative hit to the economy from heavy snowfall in late February and early March had probably been overblown. Instead the ONS said it had seen a longer-term pattern of slowing growth in the first three months of the year. Rob Kent-Smith of the ONS said: “Overall, the economy performed poorly in the first quarter, with manufacturing growth slowing and weak consumer-facing services.” While admitting bad weather will have had some impact, particularly for firms in the construction industry and some areas of the retail business, statisticians said the overall effect was limited, with increased online sales and heightened energy production during the cold snap.

The figures show the services industries contributed the most to GDP growth, with an increase of 0.3% in the first quarter, while household spending grew at a meagre 0.2%. The construction industry declined by 2.7% and business investment fell by 0.2%.

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“..an advance team of 30 White House and State Department officials was preparing to leave for Singapore later this weekend..”

Prospects of US-North Korea Summit Brighten (R.)

Prospects that the United States and North Korea would hold a summit brightened after U.S. President Donald Trump said late on Friday Washington was having “productive talks” with Pyongyang about reinstating the June 12 meeting in Singapore. Politico magazine reported that an advance team of 30 White House and State Department officials was preparing to leave for Singapore later this weekend. Reuters reported earlier this week the team was scheduled to discuss the agenda and logistics for the summit with North Korean officials. The delegation was to include White House Deputy Chief of Staff Joseph Hagin and deputy national security adviser Mira Ricardel, U.S. officials said, speaking on condition of anonymity.

Trump said in a Twitter post late on Friday: “We are having very productive talks about reinstating the Summit which, if it does happen, will likely remain in Singapore on the same date, June 12th., and, if necessary, will be extended beyond that date.” Trump had earlier indicated the summit could be salvaged after welcoming a conciliatory statement from North Korea saying it remained open to talks. “It was a very nice statement they put out,” Trump told reporters at the White House. “We’ll see what happens – it could even be the 12th.” “We’re talking to them now. They very much want to do it. We’d like to do it,” he said.

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Through Kimberley Strassel, the Wall Street Journal distances itself ever more from the MSM.

The Real ‘Constitutional Crisis’ (Strassel)

Democrats and their media allies are again shouting “constitutional crisis,” this time claiming President Trump has waded too far into the Russia investigation. The howls are a diversion from the actual crisis: the Justice Department’s unprecedented contempt for duly elected representatives, and the lasting harm it is doing to law enforcement and to the department’s relationship with Congress. The conceit of those claiming Mr. Trump has crossed some line in ordering the Justice Department to comply with oversight is that “investigators” are beyond question. We are meant to take them at their word that they did everything appropriately. Never mind that the revelations of warrants and spies and dirty dossiers and biased text messages already show otherwise.

We are told that Mr. Trump cannot be allowed to have any say over the Justice Department’s actions, since this might make him privy to sensitive details about an investigation into himself. We are also told that Congress – a separate branch of government, a primary duty of which is oversight – cannot be allowed to access Justice Department material. House Intelligence Committee Chairman Devin Nunes can’t be trusted to view classified information – something every intelligence chairman has done – since he might blow a source or method, or tip off the president. That’s a political judgment, but it holds no authority. The Constitution set up Congress to act as a check on the executive branch—and it’s got more than enough cause to do some checking here.

Yet the Justice Department and Federal Bureau of Investigation have spent a year disrespecting Congress—flouting subpoenas, ignoring requests, hiding witnesses, blacking out information, and leaking accusations. Senate Judiciary Chairman Chuck Grassley has not been allowed to question a single current or former Justice or FBI official involved in this affair. Not one. He’s also more than a year into his demand for the transcript of former national security adviser Mike Flynn’s infamous call with the Russian ambassador, as well as reports from the FBI agents who interviewed Mr. Flynn. And still nothing.

[..] Mr. Trump has an even quicker way to bring the hostility to an end. He can – and should – declassify everything possible, letting Congress and the public see the truth. That would put an end to the daily spin and conspiracy theories. It would puncture Democratic arguments that the administration is seeking to gain this information only for itself, to “undermine” an investigation. And it would end the Justice Department’s campaign of secrecy, which has done such harm to its reputation with the public and with Congress.

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“..a malevolent secret police operation..”

A Mendacious Exercise In Manufacturing Paranoia (Jim Kunstler)

After many months, the gaslight is losing its mojo and a clearer picture has emerged of just what happened during and after the 2016 election: the FBI, CIA, and the Obama White House colluded and meddled to tilt the outcome and, having failed spectacularly, then labored frantically to cover up their misdeeds with further misdeeds. The real election year crimes for which there is actual evidence point to American officials not Russian gremlins. Having attempted to incriminate Trump at all costs, these tragic figures now scramble to keep their asses out of jail.

I say “tragic” because they — McCabe, Comey, Rosenstein, Strzok, Page, Ohr, et al — probably think they were acting heroically and patriotically to save the country from a monster, and I predict that is exactly how they will throw themselves to the mercy of the jury when they are called to answer for these activities in a court of law. Of course, they have stained the institutional honor of the FBI and its parent Department of Justice, but it is probably a healthier thing for the US public to maintain an extremely skeptical attitude about what has evolved into a malevolent secret police operation.

The more pressing question is how all this huggermugger gets adjudicated in a timely manner. Congress has the right to impeach agency executives like Rod Rosenstein and remove them from office. That would take a lot of time and ceremony. They can also charge them with contempt-of-congress and jail them until they comply with committee requests for documents. Mr. Trump is entitled to fire the whole lot of the ones who remain. But, finally, all this has to be sorted out in federal court, with referrals made to the very Department of Justice that has been a main actor in this tale.

The most mysterious figure in the cast is the MIA Attorney General, Jeff Sessions, who has become the amazing invisible man. It’s hard to see how his recusal in the Russia matter prevents him from acting in any way whatsoever to clean the DOJ house and restore something like operational norms — e.g. complying with congressional oversight — especially as the Russia matter itself resolves as a completely fabricated dodge. The story is moving very fast now. The Pequod is whirling around in the maelstrom, awaiting the final blow from the white whale’s mighty flukes.

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Gullible?

Tesla Seeks To Dismiss Securities Fraud Lawsuit (R.)

Tesla Inc on Friday asked a court to dismiss a securities fraud lawsuit by shareholders who said the electric vehicle maker gave false public statements about the progress of producing its new Model 3 sedan. In a filing in federal court in San Francisco, Tesla said that its statements about the challenges the company faced with Model 3 were “frank and in plain language,” including repeated disclosures by Chief Executive Elon Musk of “production hell.” Tesla did not seek to hide the truth, its motion to dismiss said. The company says its Model 3 has experienced numerous “bottlenecks” from problems with Tesla’s battery module process at its Nevada Gigafactory to general assembly at its Fremont plant.

Tesla is under pressure to deliver the Model 3 to reap revenue and stem massive spending that has put Tesla’s finances in the red. The ramp of the Model 3, Tesla said in the court filing, was “the first of its kind,” with difficulties likely to crop up after it got underway. The lawsuit filed last October seeks class action status for shareholders who bought Tesla stock between May 4, 2016 through October 6, 2017, inclusive. It said shareholders bought “artificially inflated” shares because Musk and other executives misled them with their statements. Tesla made such statements during the lead-up to, and early production of, its Model 3 sedan and failed to disclose that the company was “woefully unprepared” for the vehicle’s production, the lawsuit said.

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Good on ’em! Cars don’t belong in cities.

Madrid Takes Its Car Ban to the Next Level (CityLab)

The days when cars could drive unhindered through central Madrid are coming to a close. Following an announcement this week, the Spanish capital confirmed that, starting in November, all non-resident vehicles will be barred from a zone that covers the entirety of Madrid’s center. The only vehicles that will be allowed in this zone are cars that belong to residents who live there, zero-emissions delivery vehicles, taxis, and public transit. Even on a continent where many cities are scaling back car access, the plan is drastic. While much of central Madrid consists of narrow streets that were never suitable to motor vehicles in the first place, this central zone also includes broad avenues such as Gran Via, and wide squares that have been islands in a sea of surging traffic for decades.

The plan is thus not just about making busy central streets more pleasant, but about creating a situation where people simply no longer think of bringing their cars downtown. This might come as a shock to some drivers, but the wind has been blowing this way for more than a decade. Madrid set up the first of what it calls Residential Priority Zones in 2005, in the historic, densely packed Las Letras neighborhood. Since then, a modest checkerboard of three other similar zones have been installed across central Madrid. The new area will be a sort of all-encompassing zone that abolishes once and for all the role of downtown streets as through-routes across the city.

To get people used to the idea, implementation of the non-local car ban will be staggered. In November, manual controls by police around the zone’s edge will begin. Cars that are breaching the new rules will be warned of the fine they face in the future—€90 per occurrence—without actually being charged then. In January, a fully automated system with cameras will be put in place, and from February, the €90 will be actively enforced against any cars found breaking the rules.

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Jun 142017
 
 June 14, 2017  Posted by at 9:34 am Finance Tagged with: , , , , , , , , , ,  17 Responses »


Fred Lyon San Francisco cable car turnaround 1946

 

A Record 60% Of Americans Disapprove Of President Trump (ZH)
Age Is The New Dividing Line In British Politics (YouGov)
UK Low Income Families Forced To Walk ‘Relentless Financial Tightrope’ (G.)
Gundlach Says DC Establishment Wants to ‘Wait Trump Out’ (BBG)
Trump Administration Welshes on “Repeal Dodd Frank” Promise (NC)
Tillerson Says Allies Pleading With US To ‘Improve Russia Relations’ (RT)
Are Public Pensions A Thing Of The Past? (CNN)
Death Of The Human Investor: Just 10% Of Trading Is Regular Stock Picking (C.)
OPEC Oil Production Jumps In May Despite Output Cuts Deal (CNBC)
China Defaults Feared as Firms Confront Short Debt Addiction (BBG)
Greeks Promised Economic Boost Despair of Ever Seeing Debt Deal (BBG)
Schaeuble Promises Greece Deal With Lenders On Thursday (R.)
Foreign Buyers Snap Up Greek Property (K.)
State Of Emergency Declared On Lesvos As 800 Left Homeless (AP)
‘Impossible And Risky To Take In More Migrants’ – Rome’s Mayor (RT)

 

 

A nation divided.

A Record 60% Of Americans Disapprove Of President Trump (ZH)

Despite record high stock prices, 43-year lows in jobless claims, and near record-high optimism among small business owners, Gallup reports the percentage of Americans who disapprove of the job President Trump has risen to a record 60% this week. As Gallup details, despite the president’s claim on Monday at a Cabinet meeting that “Never has there been a president, with few exceptions – in the case of F.D.R. he had a major Depression to handle – who’s passed more legislation, who’s done more things than what we’ve done,” his administration has been roiled by controversies. Most recently, Trump ran into a buzz saw of criticism with his decision, announced June 1, to withdraw the U.S. from participation in the Paris climate accord.

He has also been under significant political scrutiny over the June 8 testimony of former FBI Director James Comey before the Senate Intelligence Committee. Those events coincided with the lower averages seen in the past two weeks. But, given that his averages were almost as low in the weeks leading up to them, it is difficult to establish direct causality between specific events and the president’s ratings.

The highly polarized nature of Americans’ views of Trump (and Obama before him) have been well-documented, and that pattern continues: Trump’s 8% average approval rating among Democrats last week is right at his 9% average to date; His 83% approval among Republicans is three points lower than his average among that group; Among independents, his approval is 31%, five points lower than his average among that group; Notably the spread between Republican ‘confidence’ and Democrat ‘confidence’ (via Bloomberg) has not been this wide since before Barack Obama was elected…

Trump’s job approval ratings are the worst of his administration so far, and Trump continues to have the lowest ratings for a newly elected president in Gallup’s history of approval ratings. The previous low first-year approval rating in June for an elected president was Bill Clinton, with a 37% approval June 5-6, 1993. The approval ratings of all other presidents since 1953 in June (May in the case of Eisenhower) of their first year after being elected were above 50%.

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Another nation divided, but not along the same lines. Older people, especially pensioners, vote Conservative, and a much higher percentage of them actually vote.

Age Is The New Dividing Line In British Politics (YouGov)

Since last week’s election result YouGov has interview over 50,000 British adults to gather more information on how Britain voted. This is part of one of the biggest surveys ever undertaken into British voting behaviour, and is the largest yet that asks people how they actually cast their ballots in the 2017 election. The bigger sample size allows us to break the results down to a much more granular level and see how different groups and demographics voted on Thursday. In electoral terms, age seems to be the new dividing line in British politics. The starkest way to show this is to note that, amongst first time voters (those aged 18 and 19), Labour was forty seven percentage points ahead. Amongst those aged over 70, the Conservatives had a lead of fifty percentage points.

In fact, for every 10 years older a voter is, their chance of voting Tory increases by around nine points and the chance of them voting Labour decreases by nine points. The tipping point, that is the age at which a voter is more likely to have voted Conservative than Labour, is now 47 – up from 34 at the start of the campaign.

Despite an increase in in youth turnout, young people are still noticeably less likely to vote than older people. While 57% of 18 and 19 year-olds voted last week, for those aged 70+ the figure was 84%.

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Corbyn growth territory.

UK Low Income Families Forced To Walk ‘Relentless Financial Tightrope’ (G.)

Low-income families are going without beds, cookers, meals, new clothes and other essential items as they struggle to cope with huge debts run up to pay domestic bills, according to a survey highlighting the cost-of-living crisis experienced by the UK’s poorest households. Clients of the debt charity Christians Against Poverty (CAP) had run up an average of £4,500 in debts on rent or utility bills, forcing them on to what the charity described as a “relentless financial tightrope” juggling repayments and basic living costs, leaving many acutely stressed and in deteriorating health. The pressure of coping with low income and debt frequently triggered mental illness or exacerbated existing conditions, with more than a third of clients reporting that they had considered suicide and three-quarters visiting a GP for debt-related problems.

More than half were subsequently prescribed medication or therapy. “The crippling reality of living in poverty and debt is still unashamedly evident in every home we visit, and year on year we see financial difficulty taking a tighter grip,” said Matt Barlow, the UK chief executive of CAP. Experts said the survey highlighted the extreme hardship faced by the “new destitute” – people on low incomes who might in the past have been able to rely on a welfare safety net to help them through financial shocks but who now were forced to go into debt to survive, leaving them struggling to afford even the basics. Debt had a crushing effect on living standards, the CAP survey found, with one in 10 clients unable to afford to buy or repair a bed, washing machine, TV, sofa or fridge. Roughly the same proportion could afford to acquire furniture only on punitive rent-to-buy terms, for example paying £6 a week to acquire a bed and mattress over a set three-year period.

The impact on family life was severe, with a quarter of clients saying debt caused relationship breakdowns, and more than two-thirds saying they felt unable to cater for their children’s needs. A sixth said they could not afford to feed their children three meals a day. A third feared eviction. A tiny handful of clients – predominantly single mothers – reported that they had turned to prostitution to make ends meet. Prof Suzanne Fitzpatrick, of Heriot Watt University, the co-author of groundbreaking research into destitution, told the Guardian: “The new destitute are citizens who would previously have managed to avoid absolute destitution with the help of the welfare safety net. But the level of working age benefits is now so low that people barely managing to get by can easily find themselves in a position where they can’t afford even the basic essentials to eat, stay warm and dry, and keep clean.”

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“If you’re a trader or a speculator, I think you should be raising cash today, literally today..”

Gundlach Says DC Establishment Wants to ‘Wait Trump Out’ (BBG)

DoubleLine Capital’s Jeffrey Gundlach said the establishment in Washington is trying to undermine President Donald Trump by running out the clock on his administration. “They’re really just trying to wait Trump out, trying to obstruct his agenda as much as possible,” Gundlach, one of the few money managers to predict Trump’s election, said during a webcast Tuesday. “Small change is what they’re looking for.” Gundlach, manager of the $53.9 billion DoubleLine Total Return Bond Fund, spoke during televised Senate testimony by Attorney General Jeff Sessions, which the money manager called “a sideshow or entertainment.” He called the U.S. political conflict “rope-a-dope,” a strategy used by boxer Muhammad Ali to wear out opponents.

Among Gundlach’s other observations:
• There’s a low probability of a recession.
• The days of low volatility markets are probably numbered.
• Expect higher bond yields and lower stock prices this summer.
• Yields on 10-year Treasuries are likely to end 2017 roughly in the 2.7% to 2.8% range, from about 2.2% currently.

The Dow Jones Industrial Average and the S&P 500 Index closed at record highs Tuesday prior to Gundlach’s talk. Futures trading implies a 98% probability the Federal Reserve will raise interest rates by 0.25% when it meets Wednesday. “If you’re a trader or a speculator, I think you should be raising cash today, literally today,” Gundlach said. “If you’re an investor, I think you can sit through a seasonally weak period.” The Total Return fund was up 2.7% this year through June 12, beating 84% of its peers, according to data compiled by Bloomberg.

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Yves Smith’s piece is too long and comprehensive to do justice here. Click the link.

Trump Administration Welshes on “Repeal Dodd Frank” Promise (NC)

After having promised banks to get rid of Dodd Frank, which was never a strong enough bill to have a significant impact on profits or industry structure, Trump didn’t even back the House version of the bill to crimp Dodd Frank. But you’d never know that from the cheerleading from bank lobbyists upon the release of a 147 page document by the Treasury yesterday, the first of a series describing the gimmies that the Administration seeks to lavish on banks. As we’ll touch on below, the document repeatedly asserts that limited bank lending post crisis to noble causes like small businesses was due to oppressive regulations. We wrote extensively at the time that small business surveys showed that small businesses then overwhelmingly weren’t interested in borrowing and hiring. Businessmen don’t expand operations because money is cheap, they expand because they see a commercial opportunity.

But the even bigger lie at the heart of this effort is the idea that the US will benefit from giving more breaks to its financial sector. As we’ve written, over the last few years, more and more economists have engaged in studies with different methodologies that come to the same conclusion: an oversized financial sector is bad for growth, and pretty much all advanced economies suffer from this condition. The IMF found that the optimal level of financial development was roughly that of Poland. The IMF said countries might get away with having a bigger banking sector and pay no growth cost if it was regulated well. Needless to say, with the banking sector already so heavily subsidized that it cannot properly be considered to be a private business, deregulating with an eye to increasing its profits is driving hard in the wrong direction.

[..] So if it wasn’t Dodd Frank, what was led the banks to focus so much on high FICO score borrowers? It was mortgage servicing reforms, which made it hard to foreclose due to stopping abuses, like dual tracking (continuing to foreclose even when supposedly considering a mortgage modification). To look at the bigger picture, it’s hard to take bank complaints about oppressive regulation seriously in light of this:

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But the domestic echo chamber makes that hard to do.

Tillerson Says Allies Pleading With US To ‘Improve Russia Relations’ (RT)

All of America’s allies and partners have been calling on Washington to improve its relations with Russia, Secretary of State Rex Tillerson acknowledged after the US Senate reached a bipartisan deal to boost sanctions against Moscow. “I have yet to have a bilateral, one-on-one, a poolside conversation with a single counterpart in any country: in Europe, Middle East, even South-East Asia, that has not said to me: please, address your relationship with Russia, it has to be improved,” Tillerson said on Tuesday during testimony before the Senate Appropriations Committee on Foreign Operations. Tillerson added that the countries urging the US to review its Russian policy “believe worsening this relationship will ultimately worsen theirsituation.” He added: “People have been imploring me to engage and try to improve the situation, so, that was our approach anyway.”

Earlier, Tillerson warned that the US Senate’s bipartisan deal on new set of restrictive measures against Moscow might further worsen relations with Russia and hinder existing efforts on joint US-Russia progress to fight terrorism in Syria. “There are efforts under way in Syria specifically, those are, I would say, progressing in a positive way,” America’s top diplomat said on Tuesday during testimony to the Senate Foreign Relations Committee. Despite the relationship between US and Russia being “at an all-time low,” according to Tillerson, the “objective is to stabilize that” rather than deteriorate it further. Washington is “engaged” and working with Moscow “in a couple of areas,” including on such issues of international importance as the Ukrainian and Syrian crises. “We have some channels that are open, where we are starting to talk, and I think what I wouldn’t want to do is close the channels off,” Tillerson told the Senate committee, warning that to establish “something new… will take time.”

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Yes, they are.

Are Public Pensions A Thing Of The Past? (CNN)

New teachers and state workers will no longer get a traditional pension in Pennsylvania. Governor Tom Wolf signed a bill Monday, making it the ninth state to replace the pension with a “hybrid” retirement plan. It goes into effect in 2019. The new plan combines elements of a traditional pension and a 401(k)-style account. Overall, new workers will contribute more of their salary, work longer, and likely receive a smaller payout in retirement than under the current system, according to a report from the state’s Independent Fiscal Office. But Pennsylvania’s pension system is currently one of the most underfunded in the country and is in need of reform. The bill had bipartisan support. “It’s a win for Pennsylvania taxpayers and fair to Pennsylvania’s workforce,” Wolf said at a press conference Monday.

The reform will build upon previous legislation to help fully fund the pension system and preserve a path to retirement for public workers, said Greg Mennis, a director at Pew Charitable Trusts. “Our research indicates that this would be one of the most – if not the most – comprehensive and impactful reforms any state has implemented,” he wrote in a letter urging state lawmakers to pass the bill. Over the past 10 years, Rhode Island, Virginia, Tennessee and Georgia have created plans similar to Pennsylvania’s. They require workers to contribute some of their salary to a pension-like plan that guarantees a certain payout based on their salary. Workers also contribute to a 401(k)-style plan that they can take with them if they leave public service. The state will make contributions to both plans on their behalf.

In Pennsylvania, workers will be defaulted into a hybrid plan, but there will be two other versions they could opt into. Under the default, workers will have to contribute a total of 8.25% of their salary. (Teachers currently contribute 7.5% and other public workers pay 6.25%.) Most will have to work until 67, instead of 65, in order to get their full payout in retirement. A state employee who works for 35 years and earns a final salary of $60,000, currently receives an estimated $40,000 a year in retirement. Under the reformed system, that same worker would receive $34,1048, according to the Independent Fiscal Office report. [..] Like pension plans in other states, Pennsylvania’s was badly hurt by the Great Recession. It also took a hit because of retroactive benefit increases made before the market took a dive. The pension fund went from a nearly $20 billion surplus in 2000 to a $70 billion deficit in 2015.

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ZIRP machines have taken over.

Death Of The Human Investor: Just 10% Of Trading Is Regular Stock Picking (C.)

Quantitative investing based on computer formulas and trading by machines directly are leaving the traditional stock picker in the dust and now dominating the equity markets, according to a new report from JPMorgan. “While fundamental narratives explaining the price action abound, the majority of equity investors today don’t buy or sell stocks based on stock specific fundamentals,” Marko Kolanovic, global head of quantitative and derivatives research at JPMorgan, said in a Tuesday note to clients. Kolanovic estimates “fundamental discretionary traders” account for only about 10% of trading volume in stocks. Passive and quantitative investing accounts for about 60%, more than double the share a decade ago, he said.

In fact, Kolanovic’s analysis attributes the sudden drop in big technology stocks between Friday and Monday to changing strategies by the quants, or the traders using computer algorithms. In the weeks heading into May 17, Kolanovic said funds bought bonds and bond proxies, sending low volatility stocks and large growth stocks higher. Value, high beta and smaller stocks began falling in a rotation labeled “an unwind of the ‘Trump reflation’ trade,” Kolanovic said. “Upward pressure on Low Vol and Growth, and downward pressure on Value and High Vol peaked in the first days of June (monthly rebalances), and then quickly snapped back, pulling down FANG stocks” — Facebook, Amazon.com, Netflix and Google parent Alphabet, the report said.

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Told you those output cuts wouldn’t go anywhere.

OPEC Oil Production Jumps In May Despite Output Cuts Deal (CNBC)

OPEC’s oil production jumped in May, despite the exporter group agreeing last month to extend its six-month deal to cap output into 2018. Production across OPEC rose by about 336,100 barrels per day to 32.1 million bpd, according to secondary sources, led by increases from Libya and Nigeria, which are exempt from the deal, and Iraq. Output from Libya surged by more than 178,000 bpd to 730,000 bpd as the country’s rival factions moved toward reconciliation, and supplies disrupted throughout years of conflict remained on line. In Nigeria, production was up more than 174,000 bpd to 1.68 million bpd as supplies sidelined by militant attacks on energy infrastructure last year came back into operation. With the gain, Nigeria reclaimed the title of largest African producer in OPEC from Angola, where output fell by 54,000 bpd, the biggest drop among the 13 members in May.

Iraq, OPEC’s second-largest producer, contributed the third-biggest increase with a more than 44,000 bpd jump. Baghdad has yet to cut deeply enough to hit its quota of 4.35 million bpd under the output cut deal. In May, it produced 4.42 million bpd. Only four countries were producing at or below the levels they agreed to in November: Saudi Arabia, Angola, Kuwait, and Qatar. Last month, OPEC and other exporters extended an agreement to remove 1.8 million barrels a day from the market in order to shrink brimming global stockpiles of crude oil. In May, inventories in the OECD, a group of mostly wealthy countries, remained 251 million barrels above the five-year average.

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More ground for shadow banks to take over.

China Defaults Feared as Firms Confront Short Debt Addiction (BBG)

China’s leverage crackdown is forcing local companies to confront their addiction to short-term bond sales that they use to roll over debt. The shock therapy is worsening the outlook for corporate defaults in the second half of this year after borrowing costs jumped to a two-year high. With yields surging, Chinese non-banking firms sold 131 billion yuan ($19.3 billion) of bonds with a maturity of one year or less in May, the least since January 2014 and less than half of the same month last year, according to data compiled by Bloomberg. About 87% of the short note sales last month will be used for refinancing, according to Bloomberg data.

The habit of relying on borrowing short-term money to repay maturing debt has pushed up such liabilities to a total of 5.2 trillion yuan on China’s listed non-financial companies’ balance sheets as of March 31, the highest on record, according to data compiled by Bloomberg. With no sign of an end to the government’s campaign against leverage, the average coupon rate for bonds maturing in one year or less rose to 5.5% in June, deterring issuers from raising money to roll over debt. “Small issuance of short-term bonds will be a normal phenomenon in the coming six months because cash supply will probably remain tight,” said Ma Quansheng at Fullgoal Fund Management. “Both default risks and the number of corporate bond defaults may increase.”

The loose funding environment last year helped Chinese companies raise enough money to withstand repayment pressure so far in 2017. There have been 13 onshore defaults in the public bond market in 2017, compared with 16 in the same period of 2016. The yield on one-year AAA rated company bonds averaged 4.19% this year, up from 2.97% in 2016. HFT Investment Management said more note defaults may come as the economy doesn’t look good. In the second half of this year, Chinese non-banking firms must repay 2.36 trillion yuan of bonds. “The current rising borrowing costs may have a big impact on companies’ operations and finance,” said Lu Congfan at HFT Investment Management. “What can you do when you must refinance to repay maturing debt while facing such high borrowing costs? That would be a question challenging many local companies in the second half or next year.”

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Well, well… Let’s see it.

Schaeuble Promises Greece Deal With Lenders On Thursday (R.)

German Finance Minister Wolfgang Schaeuble said on Tuesday he was confident that Greece and its international lenders will reach a compromise deal this week, a step that would unleash more loans for Athens. “We’ll manage it on Thursday. You’ll see,” Schaeuble said during a panel discussion in Berlin. Officials have said eurozone finance ministers and the IMF are likely to strike a compromise on Greece on Thursday, paving the way for new loans for Athens while leaving the contentious debt relief issue for later. IMF head Christine Lagarde suggested a plan last week under which the Fund would join the Greek bailout now, because Athens is delivering on agreed reforms, but would not disburse any IMF money until the euro zone clarifies what debt relief it can offer Greece.

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Greeks don’t believe you, Wolfie…

Greeks Promised Economic Boost Despair of Ever Seeing Debt Deal (BBG)

Alexis Tsipras has spent nearly two years telling Greeks that a debt deal and inclusion in the ECB’s quantitative-easing program will unleash an investment boom that salves the pain of austerity. The prime minister’s message hasn’t convinced Panagiotis Kouinis, a 60-year-old civil engineer in Corinth who says business has steadily dwindled through all of Greece’s eight-year crisis and has now ground almost to a halt. “What I know is they tell you pensions will be cut another 20%, wages down, and what is quantitative easing?” Kouinis said in an interview in his office near the city center. “Do we have to be economists so we can understand what they’re saying?” Across the country in places like Corinth, an industrial hub 80 kilometers west of Athens, Greeks have spent years treading water as news bulletins bombard them daily with reports of meetings and decisions in Brussels and Frankfurt that will determine their economic future.

In the meantime, as the ECB’s stimulus measures – including its asset-purchase program – buoy the rest of the euro-area economy, Greece’s output has been stagnant, leaving its people the most pessimistic in the region. Yet the ECB remains unlikely to include Greek bonds in its QE program in the foreseeable future, according to a person familiar with the matter. That’s because a meeting on Thursday of euro-area finance ministers, whose electorates are leery of debt relief, looks like delivering another fudge. There may be agreement to disburse more bailout loans but without easing repayment terms enough to satisfy the ECB and IMF. That would leave Tsipras high and dry.

[..] Despite some signs of an improvement in industrial output, Greece has been heavily reliant on consumers and a booming tourist sector to keep GDP – which shrank by a quarter in the early years of the crisis – from continuing its slide. While the economy hasn’t been in a recession since 2015, and grew 0.4% at the start of the year, it hasn’t strung together more than two quarters of consecutive expansion in more than a decade. Accountancy firm PWC said in March that infrastructure investment plunged during the crisis, leaving a backlog of planned and in-progress projects amounting to more than 21 billion euros. Near Corinth, that includes rail, waste management, road and marina developments. “With taxation what it is, not only will no-one come to invest here, but they’d need to be mad to,” said Kouinis, the civil engineer. “Growth needs to start from public works, because the private sector has been killed.”

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Foreigners buy apartments in Athens to rent out to other foreigners on Airbnb. So wrong in so many ways.

Foreign Buyers Snap Up Greek Property (K.)

Property buyers from abroad are this year growing at the fastest pace in a decade, as booming Greek tourism has had a positive impact on the property market too. According to the latest data from the Bank of Greece, in the first quarter of the year the inflow of capital from abroad for real estate acquisitions increased by 61.7% on an annual basis. The March figures have signaled a further improvement, since in the first couple of months the yearly rise had come to 56.7%. If the existing growth rate is sustained throughout 2017, it is likely that by the end of the year more than 430 million euros will have been invested the Greek property market from other countries. The equivalent figure for the whole of 2016 had amounted to 270 million euros, up 45.3% on the 2015 inflow of 186 million euros.

The only time a similar growth rate had been recorded before was in the first quarter of 2007, when foreign investors spent 66.5% more money on property acquisitions than a year earlier. Real estate professionals say this uptick in foreign funds entering the local property market is particularly positive because it came during a period when transactions are usually sparse: Expressions of buying interest this year started in the winter months, not in the summer when demand typically peaks. This has bolstered optimism about an even better summer in terms of transactions, which may reach their high for the entire period since the outbreak of the financial crisis.

The major rise in inflows this year is due to the increase in demand for apartments in Athens, primarily in the city center and the southern suburbs. This mainly concerns flats eligible for short-term leasing through Internet platforms such as HomeAway, Airbnb and FlipKey. It also concerns luxury mansions that would fit the bill for the same type of online platforms as well as for the purpose of getting a Golden Visas (for buys of properties worth 250,000 euros or more by investors from outside the European Union). Besides those buyers aiming for the five-year residence permits, considerable buying interest is also coming from Italy, France, Switzerland, Germany and the Scandinavian countries.

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It’s a miracle there are not many more victims.

State Of Emergency Declared On Lesbos As 800 Left Homeless (AP)

Authorities in Greece have declared a state of emergency on the island of Lesvos after an earthquake left one woman dead and more than 800 people displaced. The 6.1 magnitude undersea quake on Monday occurred south of Lesvos but was felt as far as Istanbul, Turkey. Officials from the island’s regional government on Tuesday said homes in 12 villages in southern Lesvos had been seriously damaged or destroyed. The mostly elderly residents affected were being housed with relatives, in hotels or at an army-run shelter. The earthquake marked the second crisis to hit the island in the last two years, after hundreds of thousands of migrants and refugees, including many fleeing war in Syria and Iraq, crossed to Lesvos on boats from Turkey as they headed to Europe.

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Brussels should be forced to take in 100,000. In their new swanky buildings.

‘Impossible And Risky To Take In More Migrants’ – Rome’s Mayor (RT)

Rome Mayor Virginia Raggi has asked the Italian Interior Ministry for stricter measures to be taken toward the influx of foreigners into the capital. A letter outlining the need for a “moratorium” on “the continued influx of foreign citizens” was sent by Raggi to Roman prefect Paola Basilone. “I find it impossible, as well as risky, to think up further accommodation structures,” she wrote in the letter, as quoted by La Repubblica on Tuesday. “This administration, given the high flows of unregistered migrants, hopes the assessments of new facilities take into account the evident migrant pressure on Roma Capitale [the City of Rome] and the possible devastating consequences in terms of social costs as well as for the protection of the beneficiaries themselves.”

In May, Raggi told RT that she was working to help accommodate refugees and asylum seekers in Rome, but also that she also has a responsibility to her constituents and other countries in the EU must do their part. “Let’s put it this way – Rome would be better off if European states didn’t build walls along their borders, but rather followed through on their obligations and respected the migrant quotas agreed upon by the EU,” she told RT’s Sophie Shevardnadze. “According to the law, the city of Rome must accept migrants, as Mayor – I have to follow the law and do everything in my power to make sure that people are granted a safe place to stay here. But if other European countries decide to finally follow through on their obligations, we will welcome that decision.” “As mayor of Rome, I have to accommodate migrants, but I am also responsible for the security of my city and its residents. We cannot ignore either issue.”

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Apr 252017
 
 April 25, 2017  Posted by at 7:59 am Finance Tagged with: , , , , , , , , , ,  4 Responses »


Pablo Picasso Self portrait 1972

 

Trump Slaps 20% Duty on Canada Lumber, Intensifying Trade Fight (BBG)
Trump Summons Entire Senate To White House Briefing On North Korea (G.)
Trump Advisers To Lay Out Tax Plan For Top Republicans Tuesday (BBG)
The Oil Market Has One Big Problem: People Aren’t Buying Enough Gas (CNBC)
Canadians’ Confidence In Housing Hits Record High (HPoC)
Housing’s Echo Bubble Now Exceeds the 2006-07 Bubble Peak (CHSmith)
Bubble, Bubble, Toil And Trouble: Ultra-Low Mortgage Rates Are Dangerous (G.)
Rising Defaults In China Reveal Hidden Debt (BBG)
China Markets Reel as $1.7 Trillion in Shadow Funds Unwinds (BBG)
Naked Selfies Used As Collateral For Chinese Loans (AFP)
Italy Is the Euro-Area’s Swaps Loser Facing $9 Billion Bill (BBG)
Ontario To Pay Guaranteed Incomes To The Poor (AFP)
Kim Dotcom Wants FBI Director Comey Questioned By New Zealand Police (IBT)
At Least 16 Refugees Drown as Boat Sinks off Greece’s Lesbos (R.)

 

 

They’ve been doing this forever: “..the fight is the “longest-running battle since the Trojan War.”

Trump Slaps 20% Duty on Canada Lumber, Intensifying Trade Fight (BBG)

U.S. President Donald Trump intensified a trade dispute with Canada, slapping tariffs of up to 24% on imported softwood lumber in a move that drew swift criticism from the Canadian government, which vowed to sue if needed. Trump announced the new tariff at a White House gathering of conservative journalists, shortly before the Commerce Department said it would impose countervailing duties ranging from 3% to 24.1% on Canadian lumber producers including West Fraser Timber. “We’re going to be putting a 20% tax on softwood lumber coming in – tariff on softwood coming into the United States from Canada,” Trump said Monday, according to a tweet by Charlie Spiering at Breitbart News. A White House official confirmed the comment.

The step escalates an economic battle among neighboring countries that normally have one of the friendliest international relationships in the world. U.S. Commerce Secretary Wilbur Ross amplified Trump’s remarks in a statement afterward that also referenced a fight over a new Canadian milk policy that U.S. producers say violates Nafta. “It has been a bad week for U.S.-Canada trade relations,” Ross said, adding “it became apparent that Canada intends to effectively cut off the last dairy products being exported from the United States.” He said the Commerce Department “determined a need” because of unfair Canadian subsidies to the lumber industry to impose “countervailing duties of roughly one billion dollars.” In a dig at NAFTA, which Trump has said he wants to renegotiate, Ross added, “This is not our idea of a properly functioning Free Trade Agreement.”

[..] The so-called countervailing duties, which counter what the U.S. considers Canadian subsidies, came in below some analyst expectations. CIBC analyst Hamir Patel forecast the initial combined countervailing and anti-dumping duties could reach 45 to 55%, he said in an April 23 note. The U.S. may also apply anti-dumping duties if it determines Canadian firms are selling for below costs. That decision is expected in June. “It definitely could’ve been a heck of a lot worse,” Kevin Mason at ERA Forest Products Research said by phone. “I think a lot of people were bracing for a higher duty.”

[..] Most of the softwood in Canada is owned by provincial governments, which set prices to cut trees on their land, while in the U.S. it’s generally harvested from private property. The fees charged by Canadian governments are below market rates, creating an unfair advantage, U.S. producers say. Canada disputes that. Robert Lighthizer, Trump’s nominee to be the next U.S. Trade Representative, said at his confirmation hearing last month that he views the lumber dispute as the top trade issue between the U.S. and Canada. Oregon Democratic Senator Ron Wyden told Lighthizer the fight is the “longest-running battle since the Trojan War.”

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Huffin’-and-a-puffin’.

Trump Summons Entire Senate To White House Briefing On North Korea (G.)

The entire US Senate will go to the White House on Wednesday to be briefed by senior administration officials about the brewing confrontation with North Korea. The unusual briefing underlines the urgency with which the Trump administration is treating the threat posed by Pyongyang’s continuing development of nuclear weapons and missile technology. It follows a lunch meeting Trump held with ambassadors from UN member states on the security council on Monday where he emphasised US resolve to stop North Korea’s progress. “The status quo in North Korea is unacceptable and the council must be prepared to impose additional and stronger sanctions on North Korean nuclear and ballistic missile programs,” Trump said at the meeting. “North Korea is a big world problem, and it’s a problem we have to finally solve.”

On Friday the US secretary of state, Rex Tillerson, is due to chair a security council foreign ministers’ meeting on the issue in New York, at which the state department said he would call once more for the full implementation of existing UN sanctions or new measures in the event of further nuclear or missile tests. “This meeting will give the security council the opportunity to discuss ways to maximise the impact of existing security council measures and to show their resolve to response further provocations with appropriate new measures,” said Mark Toner, state department spokesman. Senators are to be briefed by the defence secretary, James Mattis, and Tillerson on Wednesday. Such briefings for the entire senate are not unprecedented but it is very rare for them to take place in the White House, which does not have large secure facilities for such classified sessions as Congress.

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Not going to be easy. Trump’s too desperate to get a deal done.

Trump Advisers To Lay Out Tax Plan For Top Republicans Tuesday (BBG)

President Donald Trump will call for cutting taxes for individuals and lowering the corporate rate to 15% to fulfill a promise he made during his campaign, according to a White House official. The president on Wednesday plans to make public the broad outlines of what he wants to change in the tax code, though the details likely will be left until later negotiations among congressional leaders and officials from Treasury. Trump’s top economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin will brief House Speaker Paul Ryan, Senate Majority Leader Mitch McConnell and the leaders of congressional tax-writing committees – House Ways and Means Committee Chairman Kevin Brady and Senate Finance Committee Chairman Orrin Hatch.

While Trump and Ryan broadly agree on sharply cutting individual income and corporate taxes, there are areas of disagreement between the two. On the campaign, Trump called for a corporate tax rate of 15%; Ryan wants 20%, and he has warned that cutting it an additional 5 percentage points could prevent the ultimate tax plan from being revenue neutral. Without Democratic support, a plan would have to be revenue neutral to meet the criteria set by lawmakers to make tax changes permanent. “I’m not sure he’s going to be able to get away with that,” Hatch told reporters Monday. “You can’t very well balance the budget that way.”

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Demand goes down because people have less money to spend. All the rest is humbug.

The Oil Market Has One Big Problem: People Aren’t Buying Enough Gas (CNBC)

Lackluster gasoline demand is once again raising concerns that the oil market won’t be able to escape the doldrums. Demand for U.S. gasoline has recovered since January, but remained below 2016 levels throughout much of this year. Now, analysts are worried weak consumption will cause gasoline stockpiles to keep building and eventually result in weaker crude oil demand and pricing. U.S. gasoline futures were down more than 1% on Monday, reflecting demand concerns as refiners emerge from the winter maintenance season and prepare to turn out more fuel. Meanwhile, U.S. crude settled 39 cents lower at $49.23, extending last week’s deep losses. “As gas prices drop, that creates an undertow for the entire crude oil market,” said Tom Kloza, global head of energy analysis at Oil Price Information Service.

Part of the problem is a tough comparison with extraordinarily low gasoline prices last year. The national average gasoline price on Monday was nearly 28 cents above last year’s level, according to GasBuddy.com. “I’m in the camp that says last year was a little bit of the anomaly,” Kloza said. “Gas was so cheap that we drove a little bit more almost capriciously. This year, I just don’t think it’s going to happen.” In a troubling sign, the nation’s gasoline station operators have reported at industry conferences that their sales are down 1.5 to 2% this year, according to Andy Lipow, president of Lipow Oil Associates. “When you hear retailers telling you that their demand is down you’ve got to be a believer,” he told CNBC. Lipow said he fears that trend will carry through for the balance of 2017. Demand is certain to rise as the summer driving season ramps up, but Lipow sees stockpiles remaining relatively high.

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Stark raving madness. A housing market that is rising at ‘only’ 9.5% per year is labeled ‘rational’.

Canadians’ Confidence In Housing Hits Record High (HPoC)

The experts are getting louder in their warnings that a housing bubble has formed in some parts of Canada, but Canadians don’t seem worried. In fact, confidence in the housing market hit a record high in the latest weekly Bloomberg-Nanos index — even as respondents turned negative on their own personal finances. The survey found 48.5% of Canadians expect house prices to rise in the next six months, the highest level recorded in the survey since 2008. Fewer than 11% expect to see house prices decrease. “Bullish sentiment on real estate in Canada continues to drive consumer confidence,” pollster Nik Nanos said in a statement. “Household expectations have improved by roughly 10% since the start of the year as the effects of the oil price shock have stabilized and the focus has moved toward rising property values,” Bloomberg economist Robert Lawrie said.

“In recent weeks, however, consumer sentiment regarding personal finances began drifting lower, with extended household balance sheets perhaps the next focus of concern for policymakers.” High debt levels are precisely why many market observers are growing concerned about Canada’s priciest housing markets, namely the Toronto and Vancouver regions. House prices in Toronto jumped 33% in March from a year earlier, to an average of $916,567. While Vancouver’s house prices have moderated over the past six months, they remain elevated, with the benchmark price at $919,300 in March.

National Bank of Canada, which co-publishes the Teranet house price index, warned recently that “irrational exuberance” may be setting into some Canadian housing markets, noting that more than half of Canada’s regional markets are seeing price growth above 10% annually. With mortgages ballooning, Canadian household debt has repeatedly hit record highs in recent years, and now stands at $1.67 of debt for every dollar of disposable income. Those elevated debt levels are the main reason one why the Bank for International Settlements (BIS), a Geneva-based “central bank of central banks,” warned recently that Canada has the second-highest risk of a financial crisis, behind only China.

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Essential and repeated here a 1000 times: “Bubbles have a habit of overshooting on the downside when they finally burst.”

Housing’s Echo Bubble Now Exceeds the 2006-07 Bubble Peak (CHSmith)

A funny thing often occurs after a mania-fueled asset bubble pops: an echo-bubble inflates a few years later, as monetary authorities and all the institutions that depend on rising asset valuations go all-in to reflate the crushed asset class. Take a quick look at the Case-Shiller Home Price Index charts for San Francisco, Seattle and Portland, OR. Each now exceeds its previous Housing Bubble #1 peak:

It seems housing bubbles take about 5 to 6 years to reach their bubble peaks, and about half that time to retrace much or all of the gains. Bubbles have a habit of overshooting on the downside when they finally burst. The Federal Reserve acted quickly in 2009-10 to re-inflate the housing bubble by lowering interest rates to near-zero and buying over $1 trillion of mortgage-backed securities. When bubbles are followed by echo-bubbles, the bursting of the second bubble tends to signal the end of the speculative cycle in that asset class. There is no fundamental reason why housing could not round-trip to levels below the 2011 post-bubble #1 trough.

Consider the fundamentals of China’s remarkable housing bubble. The consensus view is: sure, China’s housing prices could fall modestly, but since Chinese households buy homes with cash or large down payments, this decline won’t trigger a banking crisis like America’s housing bubble did in 2008. The problem isn’t a banking crisis; it’s a loss of household wealth, the reversal of the wealth effect and the decimation of local government budgets and the construction sector. China is uniquely dependent on housing and real estate development. This makes it uniquely vulnerable to any slowdown in construction and sales of new housing. About 15% of China’s GDP is housing-related. This is extraordinarily high. In the 2003-08 housing bubble, housing’s share of U.S. GDP barely cracked 5%. Of even greater concern, local governments in China depend on land development sales for roughly 2/3 of their revenues.

If you need some evidence that the echo-bubble in housing is global, take a look at this chart of Sweden’s housing bubble. Oops, did I say bubble? I meant “normal market in action.”

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“..we may be in the latter stages of a bubble. As prices rise further and further out of reach, lenders need to find more and more ingenious tricks to keep rich people pumping their cash into an overheated market. The punch bowl has to keep going round, or the party stops.”

Bubble, Bubble, Toil And Trouble: Ultra-Low Mortgage Rates Are Dangerous (G.)

Between autumn 1977 and Christmas 1979, interest rates rose from 5% to 17%. If you were a young boomer whose biggest cost was a variable rate mortgage, that would have hurt. In 2009, by contrast, interest rates were cut to a record low of 0.5%, and stayed there for the better part of a decade. When eventually they did move again, it was down. You don’t know you’re born. Except, of course, you do – because, if you’re reading this and you’re under 40, there’s a pretty good chance you’re still stuck paying rent. Yes, interest rates are low; no, this is not particularly helpful. Even if you do have a mortgage, it’s probably a fixed rate one because, let’s be honest, those rates are going up again one day. But not, it seems, today. The Yorkshire Building Society has just launched a new mortgage that charges an interest rate of just 0.89%. “We are very pleased to offer borrowers the lowest mortgage rate ever available,” said a spokesman.

“The cost of funding has fallen in recent weeks and, as a financially strong building society with no external shareholders to satisfy, we have the ability to pass this on to borrowers.” (“We used to dream of mortgages at under 1%,” say the boomers.) So does that means that owning a home is now cheaper than it’s ever been? Well, no, of course not. For one thing, this isn’t a fixed rate deal. It’s actually a (bear with me on this) two-year-long discount of 3.85% to the standard variable rate (SVR) of 4.74%. That means it’s very, very unfixed indeed: a normal tracker mortgage moves in response to Bank of England rates; an SVR one moves in response to the lender’s whims. Accepting this mortgage means placing a bet that the Yorkshire Building Society will be nice to you. It also comes with an unusually high arrangement fee of £1,495, but this shouldn’t bother you, because you probably can’t get that rate anyway. To even be considered, you need a deposit worth 35% of the value of your home.

[..] But there’s another, more sinister, reading of the recent rash of ultra-low mortgage rates: it suggests we may be in the latter stages of a bubble. As prices rise further and further out of reach, lenders need to find more and more ingenious tricks to keep rich people pumping their cash into an overheated market. The punch bowl has to keep going round, or the party stops. But bubbles tend to burst. Prices can’t rise forever: one day, interest rates must surely rise. When the inevitable happens, there is a danger that those who took advantage of this deal may find their equity wiped out – and the rate they’re paying will shoot through the roof.

That would obviously be very sad for those who are affected; for those shut out of home ownership, though, it may be no bad thing. That’s because nine years of record-low interest rates have probably contributed to the fact that house prices have soared out of reach; and higher prices have meant increasingly unattainable deposits. A rise in interest rates could, paradoxically, make housing more affordable.

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Companies guaranteeing each other’s crappy debt. What could go wrong? Problem is, Beijing had let them do it for years.

Rising Defaults In China Reveal Hidden Debt (BBG)

Rising defaults in China are unearthing hidden debt at companies across the country. Small firms that can’t get loans by themselves have been winning banks over by getting other companies to guarantee their borrowings. The companies making those pledges exclude them from their balance sheets, leaving creditors in the dark. Borrowers often extend the guarantees for each other, raising the risk that failures could ricochet, at a time when increasing borrowing costs have already added to strains. China’s banking regulator has ordered checks of such cross-guaranteed loans, Caixin reported Friday. Scrutiny is mounting after a corn oil producer in the eastern province of Shandong said last month it had guaranteed debt of a neighboring aluminum product manufacturer which is now stuck in a cash crunch.

Just days before that, a local government financing vehicle in China’s southwest had to repay an auto parts maker’s loans it had guaranteed after the latter defaulted. “Disclosure of such guarantees isn’t timely,” said Qiu Xinhong at Shenzhen-based First State Cinda. “Sometimes, it’s like a buried mine and you don’t know when the risks will explode.” This debt minefield could be big. The amount of loan guarantees at privately held firms in China is equivalent to 11% of their equity, and at LGFVs is 18%, according to Citic Securities. The load is even heavier at weaker borrowers. About 44% of issuers rated lower than AA- have a ratio of more than 30%, according to Everbright Securities. The phenomenon is less common in the U.S. because banks don’t require such guarantees to offer loans, according to Fitch Ratings.

“If companies in the same region offer a huge amount of guarantees for each other’s debt, it would form a guarantee web and deepen interconnections among the companies,” said Gang Meng, director of rating at Golden Credit Rating International Co. in Beijing. “If one company has to repay debt for its guaranteed company, risks would quickly ripple to other companies in the web, which will result in a butterfly effect.” [..] Guarantors don’t mark the pledges on their balance sheets and often disclose them only on an annual basis. Such shadow debts pose rising risks after central bank tightening pushed up onshore corporate bond yields to two-year highs and defaults on local notes surged to a record.

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The distinction between state banks and shadows has become very murky.

China Markets Reel as $1.7 Trillion in Shadow Funds Unwinds (BBG)

A $1.7 trillion source of inflows into Chinese markets has suddenly switched into reverse, roiling the nation’s money management industry and sending local bonds and stocks to their biggest losses of the year. The turbulence has centered on so-called entrusted investments – funds that Chinese banks farm out to external asset managers. After years of funneling money into such investments, banks are now pulling back in response to a series of regulatory guidelines over the past three weeks that put a spotlight on the risks. Critics have blamed entrusted managers for adding leverage to China’s financial system and reducing transparency.

The banks’ withdrawals helped erase $315 billion of stock market value over the past six days and sent bond yields to the highest level in nearly two years, highlighting the challenge for Chinese authorities as they try to rein in shadow banking activity without destabilizing financial markets. While the government has plenty of firepower to prop up asset prices if it wants to, forecasters at Australia & New Zealand Banking predict the selloff will deepen this year. “We are seeing an exodus of funds,” said He Qian at HFT Investment Management, which oversaw about 189 billion yuan ($27.5 billion) as of last year. He was one of about half-a-dozen asset managers and analysts who said banks have started scaling back their entrusted investments.

The arrangements have become an important part of China’s shadow finance system. When banks sell wealth-management products – the ubiquitous savings vehicles that offer higher yields than deposits – the firms sometimes farm out client money to entrusted managers such as hedge funds and mutual funds. The managers invest the cash in bonds, stocks and other securities, hoping to generate enough income to cover the banks’ promised returns to WMP clients – plus some extra for themselves.

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You better look good than feel good.

Naked Selfies Used As Collateral For Chinese Loans (AFP)

Hundreds of photos and videos of naked women used as collateral for loans on a Chinese online lending service have leaked onto the web, highlighting regulatory problems in the fast-growing peer-to-peer marketplace. A 10-gigabyte file posted on the internet exposed the personal details of more than 160 young women who were asked to provide the explicit material to secure money through online lending platform Jiedaibao. Launched by JD Capital in 2015, Jiedaibao allows lenders to operate anonymously but requires borrowers to reveal their real names when making transactions. Loan amounts and interest rates can be customised to meet the needs of users – often people who have a hard time accessing loans through more traditional financial institutions, like banks.

Interest on the “nude loans” reached an astonishing 30% a week, according to the Global Times newspaper. Lenders told female borrowers that if they failed to repay the loans, their nude photos would be sent to their families and friends, whose information was also required for some transactions, the article said. Material in the file put on the web last Wednesday showed some borrowers also promised to repay loans with sexual favours, according to screen captures posted on social media websites. In a statement on its official Twitter-like Weibo account, Jiedaibao said it had tracked down the accounts of several borrowers through photos and ID information circulated online and had frozen the suspected lenders’ accounts. “The ‘nude loans’ deals were mainly initiated and completed offline, and Jiedaibao only played the role of a money transfer platform in the deals,” the statement said.

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Derivatives used this way are instruments of massive wealth destruction. Why use different rates for each side of the deal? “..the Italian Treasury “usually pays a flow anchored to a fixed rate, while receiving one indexed to the 6-month Euribor rate..”

Italy Is the Euro-Area’s Swaps Loser Facing $9 Billion Bill (BBG)

Derivatives burdened Italy’s public debt again last year for a record amount of €8.3 billion ($9 billion), making the country the biggest swaps loser in the euro region. Losses related to swaps held by the nation added €4.25 billion to the country’s debt while net liabilities’ burden totaled €4.07 billion, based on data released Monday by EU statistics office Eurostat. In the 2012-2016 period, the burden totaled €29.6 billion, also a euro-area record. Italy’s derivative-related losses and net liabilities were higher than those for the whole euro region combined both in 2016 and in the five-year period as some countries actually saw the swaps helping to alleviate their debts. Governments across the euro region have used derivatives to manage their debt-financing costs and to hedge against sudden changes in rates and excessive exchange-rate volatility.

Those deals have sometimes backfired with the effect of pushing nations’ debts even higher. In the existing interest-rate swaps the Italian Treasury “usually pays a flow anchored to a fixed rate, while receiving one indexed to the 6-month Euribor rate,” the government said earlier this month in an annex to its annual Economic and Financial Document. Since starting from November 2015, the Euribor stayed negative and the impact on the flow indexed to that rate was that the Treasury had to pay money to its counterparts, instead of being paid by them, the document also said. Italy’s public debt rose last year to €2.2 trillion, or 132.6% of the country’s GDP, Eurostat said in a separate report on Monday.

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it’s important to get it right.

Ontario To Pay Guaranteed Incomes To The Poor (AFP)

Ontario has launched a pilot program to provide a guaranteed basic income to a few thousand people to test its effects on recipients and public finances, the Canadian province announced on Monday. Provincial premier Kathleen Wynne said the program would provide a “basic income” for three years to 4,000 people living under the poverty line. “We want to find out whether a basic income makes a positive impact in people’s lives,” Ms Wynne said, adding that “everyone should benefit from Ontario’s economic growth.” Income support payments will be as high as Can$16,989 (£9,800) a year for an individual, or Can$24,027 for a couple, plus an additional Can$6,000 for the disabled.

The figures will be reduced for those holding part-time jobs – they will receive 50 cents less for each dollar earned. As a concrete example, a single person with a yearly salary of Can$10,000 will receive an additional payment of Can$11,989. The 4,000 participants, aged 18 to 65, have been chosen at random in three cities: Hamilton and Lindsay in the Toronto suburbs and Thunder Bay in the province’s west. The province estimates the cost of the program at Can$50 million a year. Ontario is the most heavily populated Canadian province, with 38% of the country’s 36.5 million inhabitants. 13% of Ontario residents live below the poverty line, according to Statistics Canada.

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What the FBI did has already been declared illegal in New Zealand courts.

Kim Dotcom Wants FBI Director Comey Questioned By New Zealand Police (IBT)

FBI Director James Comey is currently in New Zealand and if Kim Dotcom has his way, Comey could find himself being questioned by the New Zealand police. The internet entrepreneur, who is wanted by the United States on multiple charges including fraud and copyright infringement, filed a complaint with the police Tuesday against the FBI director for what Dotcom called theft of his data by the agency. The alleged theft happened when the police raided Dotcom’s home Jan. 20, 2012, as part of investigations instigated by the U.S. The charges against him are based on the now-defunct website Megaupload that he operated, where users could share content with each other.

Some of that content was illegal to share, but according to New Zealand laws, internet service providers are not held responsible for the actions of their users. In his complaint Tuesday, Dotcom’s lawyer urged the police to urgently question Comey, who is in New Zealand for a conference. The grounds for the complaint are that the FBI received copies of data that was taken from Dotcom’s home during the 2012 raid, an act which courts in the country have held to be illegal, according to the complaint.

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The value you put on someone else’s life inevitably becomes the value of your own life.

At Least 16 Refugees Drown as Boat Sinks off Greece’s Lesbos (R.)

At least 16 people, including two children, drowned after an inflatable boat carrying refugees and migrants sank off Greece’s Lesbos island, authorities said on Monday. They are believed to be the first confirmed deaths in Greek waters this year of migrants or refugees making the short but dangerous crossing from Turkey on overcrowded rubber dinghies. Nine bodies were recovered in Greek territory and another seven in Turkish waters, Greek and Turkish coastguard officials said. Two survivors have been rescued. The two women, one of whom is pregnant, told the United Nations refugee agency UNHCR that 20 to 25 people were on board when the dinghy capsized around 1900 GMT on Sunday. The women are from Cameroon and the Democratic Republic of Congo.

Though fewer than 10 nautical miles separate Lesbos from Turkish shores, hundreds of people have drowned trying to make the crossing since Europe’s refugee crisis began in 2015. In that year, Lesbos was the main gateway into the European Union for nearly a million Syrians, Iraqis and Afghans. But a deal in March 2016 between the EU and Ankara has largely closed that route. Just over 4,800 people have crossed to Greece from Turkey this year, according to UNHCR data. An average of 20 arrive on Greek islands each day. “The number of people crossing the Aegean to Greece has dropped drastically over the past year, but this tragic incident shows that the dangers and the risk of losing one’s life remains very real,” said Philippe Leclerc, UNHCR Greece representative.

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Dec 302015
 
 December 30, 2015  Posted by at 9:12 am Finance Tagged with: , , , , , , , , ,  4 Responses »


DPC Boston and Maine Railroad depot, Riley Plaza, Salem, MA 1910

US Companies Led the World in 2015 Debt Defaults (BBG)
China’s Unprecedented Real Estate Bubble Is a Ticking Time Bomb (Dent)
The Most Important China Chart Of 2015 (BI)
China Suspends Foreign Banks’ Forex Business (Reuters)
Oil Prices Become a Problem for US Steelmakers (BBG)
Oil-Producing US States Battered as Tax-Gushing Wells Are Shut Down (BBG)
Gulf States Forced To Empty Their Sovereign Wealth Funds (Reuters)
Oil Price Rout Will Bring End To Era Of Saudi Arabian Largesse (Telegraph)
Oil Crash Is Giving Ship Owners a Billion-Dollar Windfall (BBG)
Puerto Rico’s Debt Trap (Simon Johnson)
Marc Faber Seeing Recession Clashes With Yellen, Likes Treasuries (BBG)
World’s Oldest Bank Sells Bad Loans To Deutsche (BBG)
Italy’s Five Star Movement on the Rise (FT)
In the Year of Trump, the Joke Was On Us (Matt Taibbi)
Turkey’s Dangerous Game in Syria (WSJ)
Ukraine Inflation Hits 44% Amid Economic Collapse (Telegraph)
Frontex Sends 300 Guards In Migrant Mission To Greece (AFP)
Heated Areas To Open To Homeless In Athens As Cold Snap Expected (Kath.)
As Europe Turns Gray (Pantelis Boukalas)

“About 60% of this year’s global defaults have come from U.S. borrowers, Vazza wrote, up from 55% a year ago..”

US Companies Led the World in 2015 Debt Defaults, S&P Says (BBG)

More U.S. companies have defaulted on their debt this year than issuers from any other country or region, S&P analysts led by Diane Vazza wrote in a Dec. 24 report. As of last week, 111 companies worldwide had defaulted on their obligations, the highest tally since 2009 when the the figure hit 242 for the same period. About 60% of this year’s global defaults have come from U.S. borrowers, Vazza wrote, up from 55% a year ago, when 33 of 60 defaulters were American. After the U.S., companies from emerging markets were the second-largest defaulters, accounting for 23% of the pool, which is a smaller share than last year, according to S&P data. Plummeting oil prices and speculation about how the Federal Reserve’s plan to tighten monetary policy would affect corporate borrowing costs has made companies more vulnerable, Vazza wrote.

“The current crop of U.S. speculative-grade issuers appears fragile, and particularly susceptible to any sudden, or unanticipated shock,” she wrote. Arch Coal was the most recent addition to the list, having its credit rating downgraded to “speculative default” by Standard & Poor’s last week after the coal producer missed about $90 million in interest payments and exercised a 30-day grace period with the holders of some of its notes. Looking ahead, S&P expects the U.S. corporate default rate will rise to 3.3% by September 2016 from 2.5% a year earlier. The bulk of the failures will come from companies in the oil and gas sector, which accounted for about a quarter of this year’s defaults. Since 1981, the average default rate for global speculative-grade companies is 4.3%, Vazza said.

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The Chinese are buying into global bubbles. That’s going to hurt.

China’s Unprecedented Real Estate Bubble Is a Ticking Time Bomb (Dent)

We woke up this morning to find oil prices weighing on the market… again… with China suffering the biggest losses. Oil prices have already kept stocks at bay in the best time of the year. Funny how this “Santa Claus” rally that I predicted wouldn’t happen this year, didn’t. The last time was in 2007 and 2008 – the last years the stock market crashed. I’ve been looking at how low oil prices will be the first trigger in the next crisis. Although it helps consumers a bit, low prices kill the $1 trillion QE-driven fracking industry that’s been such a stalwart of this bubble economy. And it’s already causing junk bonds to fall further in value, as energy-related bonds have been as high as 20% of that market recently. But the second and biggest trigger I’ve been warning about is China’s unprecedented real estate bubble collapsing…

Recall the Japanese at the top of their stock and real estate bubble in 1989. They were buying real estate hand-over-fist, from Pebble Beach to Rockefeller Center to London. Then, after bidding them up, they ended up selling those holdings at big losses. The Chinese make the Japanese look prudent! Chinese buyers are bidding up the high end of the top coastal cities in English-speaking countries like they’ll never go down and like they can’t get enough. We’re talking Sydney, Melbourne, Brisbane, Auckland, Singapore, San Francisco, L.A., Vancouver, Toronto, New York, London… These markets are considered “Teflon-proof.” They’re not! In fact, they’re some of the greatest bubbles that exist today. China’s leading cities – like Shanghai, Beijing and Shenzhen – are up 700% or more since 2000!

Guess what happens when the bubble wealth in real estate that has built up in China finally collapses? So does the capacity of the more affluent Chinese to buy real estate around the world. And these are the guys who have by-and-large been driving this global real estate bubble at the margin on the high end! Bear in mind that Chinese real estate has been slowing and prices falling for over a year. That is precisely why China’s stock market bubbled up 160% in less than one year. When Chinese investors realized they could no longer make easy money in the real estate bubble, they turned to stocks. And after the dumb money piled in, the Shanghai Composite stock index fell 42% in just 2.5 months!

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China’s move towards a service economy is sure to fail. Xi cannot force his people to spend.

The Most Important China Chart Of 2015 (BI)

Now that the year is almost over, it’s time to reflect on 2015. BI reached out to the brightest minds on Wall Street to get their thoughts on what just happened. Hopefully, they’ll help us get a better handle on what is about to happen in 2016. Charlene Chu, of Autonomous Research, is widely considered one of the most brilliant China analysts in the world. So we asked her to send us a chart that helped her make sense of the world in 2015. Naturally it’s about China. “The chart below highlights the growth problem China is grappling with. In our view, a broken growth model lies at the core of China’s financial sector issues,” she wrote in an email to Business Insider. “This chart comes directly from official data, which is not adjusted in any way. Secondary industry comprises about 40-45% of GDP. As the title says, nearly half of China’s economy is already experiencing a very hard landing. This will likely intensify in 2016, which will weigh on global growth and add to corporate debt repayment problems.”


CEIC and the National Bureau of Statistics; Charlene Chu, Autonomous Research

In China, GDP is classified into three industries, primary (agriculture), secondary (manufacturing and construction), and tertiary (services). This slowdown in the secondary industry is part of China’s intentional shift toward an economy focused on services and consumer consumption rather than manufacturing. Chu’s point is that it’s happening harder and faster than anyone thought it would. All of this became all too apparent in 2015. This year China experienced two mainland stock market crashes, it devalued its currency, and once booming sectors of the economy — like exports and property — slowed sharply. In response, the government loosened monetary policy and enacted stimulus measures. The measures have had a limited impact, however, indicating that more structural measures will be needed to remedy the situation. Chu expects this slowdown to continue through 2016, affecting markets around the world.

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Trying to stop outflows. Ever since the IMF included the yuan in its basket, it’s been all downhill.

China Suspends Foreign Banks’ Forex Business (Reuters)

China’s central bank has suspended at least three foreign banks from conducting some foreign exchange business until the end of March, three sources who had seen the suspension notices told Reuters on Wednesday. Included among the suspended services are liquidation of spot positions for clients and some other services related to cross-border, onshore and offshore businesses, the sources said. The sources, speaking on condition that the banks were not named, said the notices sent to the affected foreign banks by the People’s Bank of China (PBOC) gave no reason for the suspension. The sources said the banks might have been targeted due to the large scale of their cross-border forex businesses.

“This is part of the PBOC’s expedient means to stabilize the yuan’s exchange rate,” said an executive at a foreign bank contacted separately. China has taken a slew of steps to keep the yuan stable since it devalued the currency in August. The latest move comes just three months since the PBOC ordered banks to closely scrutinize clients’ foreign exchange transactions to prevent illicit cross-border currency arbitrage, which takes advantage of the different exchange rates the yuan fetches in offshore and onshore markets. The spread has been growing since the August devaluation, which makes it increasingly difficult for the bank to manage its currency and stem an outflow of capital from its slowing economy.

The yuan has come under renewed pressure since late November amid speculation that Beijing would permit more depreciation after the IMF announced the currency’s admission into the fund’s basket of reserve currencies. The onshore yuan traded in Shanghai has lost 1.44% of its value since the end of November, and has repeatedly hit 4-1/2 year lows. The offshore market has traced a similar pattern. The Hong Kong-traded offshore yuan hit an intraday low of 6.5965 on Wednesday morning, its weakest since late September 2011.

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The oil industry is (was) a major purchaser of steel products.

Oil Prices Become a Problem for US Steelmakers (BBG)

U.S. steelmakers battered by plunging prices have been quick to blame a flood of cheap Chinese shipments. But with imports nearing four-year lows, another culprit is emerging: the energy collapse. Foreign steel coming into the U.S. dropped 36% in November from a year ago, according to U.S. Census Bureau data. That’s with domestic prices at the weakest in at least nine years and new taxes on products from six countries deemed to be unfairly priced. Yet U.S. mills have idled the most capacity since the financial crisis, operating at just 61% in the week ending Dec. 21. Helping explain the capacity decline is a drop in demand for steel pipes and drill bits used in the energy industry after the price of oil plunged 66% in the past 18 months. Previously, sales of high-margin products to oil and gas companies had helped shield U.S. mills from sluggish growth in construction and other industries.

“I don’t think imports are the only problem,” domestic mills face, Timna Tanners at Bank of America said in an interview Tuesday. “Nobody really expected oil to stay as low as it did as long as it has.” An important result of the energy collapse for steel consumption is that inventories held by steel and energy companies take longer to deplete as demand falls, exacerbating the decline in consumption, Tanners said. “Domestic mills in 2014 charged a price that was much higher than the rest of the world and that drew imports,” she said. “The domestic mills can complain that it’s unfairly traded, but there are factors outside of that that have nothing to do with fairness.” The price of hot-rolled steel coil, a benchmark product, has dropped 38% this year, according to The Steel Index, a trade publication that surveys buyers and sellers.

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Wait till home prices, and hence property tax revenues, go down as well.

Oil-Producing US States Battered as Tax-Gushing Wells Are Shut Down (BBG)

In Kern County, California, one of the nation’s biggest oil producers, tumbling energy prices have wiped more than $8 billion from its property-tax base, forcing officials to tap into reserves and cut every department’s budget. It’s only getting worse. The county of 875,000 in the arid Central Valley north of Los Angeles may face another blow in January, when it reassess the oil-rich fields that line the landscape. Last year’s tax bills were based on crude selling for $54 a barrel. It finished Monday at less than $37.
“We may never go back to $99 a barrel, but we were good at $54,” said Nancy Lawson, assistant administrative officer of Kern County, which includes the city of Bakersfield. “If it keeps going down and stays down we may have to look at more cuts in the next budget.”

As the price of crude falls for a second year, marking the steepest decline since the recession, the impact is cascading through the finances of states, cities and counties, in ways big and small. Once flush when production boomed, some governments in major energy producing regions are facing a new era of unwelcome austerity as wells are shut – along with the tax-revenue gushers they spouted. Alaska, Louisiana and Oklahoma have seen tax collections diminished by the rout, which has put pressure on credit ratings and led investors to demand higher yields on some securities. In Texas, the largest producer, the state’s sales-tax revenue dropped 3% in November from a year earlier as the energy industry exerted a drag on the economy.

Further west, Colorado’s legislative forecasters on Dec. 21 estimated that the state’s current year budget will have a shortfall of $208 million, in part because of the impact of lower commodity prices. In North Dakota, tax collections have trailed forecasts by 9% so far for the 2015-2017 budget. “The longer it goes the more significant it gets,” said Chris Mier at Loop Capital Markets in Chicago.

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“..these sheikhdoms – which pump about a fifth of the world’s oil – would almost drain their funds entirely by 2020.”

Gulf States Forced To Empty Their Sovereign Wealth Funds (Reuters)

Oil-rich Gulf sheikhdoms are being forced to raid their sovereign wealth funds to shore up their budgets. With U.S. crude oil prices falling below $40 per barrel in December, they have no choice but to reach into these rainy-day savings. For now, they can hold on to some of their trophy assets, like strategic investments in Volkswagen or Barclays. But if crude prices keep tumbling, a fire sale will be hard to avoid. During the most recent energy boom, the six members of the Gulf Cooperation Council – including Saudi Arabia, Qatar and Kuwait – amassed sovereign funds worth more than $2.3 trillion. These assets have traditionally comprised a mix of debt and other securities, in addition to influential stakes in some of the world’s biggest companies such as Glencore, VW and Barclays.

Large chunks of this cash are now being repatriated back to the region to finance widening budget deficits, which this year are expected to be in the region of 13% of GDP in the GCC. Should oil prices average $56 per barrel next year, then GCC states would need to liquidate some $208 billion of their overseas assets, or just below 10% of their sovereign fund holdings, based on a Breakingviews analysis of their fiscal break-even costs. But if oil prices fall to $20 a barrel, as Goldman Sachs has warned, the GCC states may have to sell $494 billion worth of booty to make up the budgetary shortfalls based on forecast fiscal costs for their oil production in 2016. This is provided they maintain the lavish rates of public spending that the region’s populations have become accustomed to.

At that rate of divestment these sheikhdoms – which pump about a fifth of the world’s oil – would almost drain their funds entirely by 2020. The Saudi Arabian Monetary Agency – which also acts as the country’s central bank – has already started to sell down some of its foreign assets, while money managers are reporting growing redemptions from other funds in the region. Gulf rulers have so far resisted any temptation to jettison their most treasured assets, which in many cases have granted them board seats atop some of the world’s leading companies. As oil keeps falling, even these investment jewels will come up for grabs.

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Saud will have to cut payments to its thousands of princes.

Oil Price Rout Will Bring End To Era Of Saudi Arabian Largesse (Telegraph)

A global oil price rout will bring an end to the era of Saudi Arabian largesse, as crude prices have tumbled to 11-year lows. “The era of material overspending is likely firmly behind us”, said Jean-Michel Saliba, an economist at Bank of America. A brutal sell-off in commodity prices has taken its toll on the Gulf state, which has been dependent on oil for more than three-quarters of its revenues. “Fiscal space is likely tight,” Mr Saliba said, in the wake of a historic budget for the Saudi regime. Officials have been forced to report a record budget deficit of 367bn riyals (£66bn) this year, up from 54bn riyals the previous year. While the deficit was smaller than anticipated, at 15pc of Saudi’s GDP, rather than the 20pc anticipated by economists, Mr Saliba warned that the government’s official figures have been prone to revision in the past, and have “tended to be revised upwards mid-way through the following year”.

Policymakers now plan to slash the deficit to 327bn riyals in 2016, by cutting back spending from 975bn riyals to 840bn riyals. The budget “is a significant one for the Saudi Arabian economy,” explained Mr Saliba. The country’s leadership, painfully reliant on oil, have failed to diversify the Saudi economy. The kingdom’s 2016 budget “likely markets the end of material overspending practices given tighten controls”, as the price of a barrel of Brent crude has tumbled from $115 (£77) in July 2014 to just $36 in recent days. “Budget execution will now be paramount,” said Mr Saliba. The new Saudi budget revealed plans to throttle investment spending. However, officials intend “only to slow the growth in recurring expenditure”, the Wall Street bank explained, rather than planning to cut it outright. The small non-oil parts of the economy will find themselves constrained by plans to cut public spending growth, preventing Saudi Arabia from rebalancing away from the commodity that until now has kept it wealthy.

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Don’t forget this is happening as everyone is producing at full blast. Storage space will be finite. And then?!

Oil Crash Is Giving Ship Owners a Billion-Dollar Windfall (BBG)

The most destructive oil crash in a generation is giving ship owners a billion-dollar windfall. With OPEC abandoning output limits in a drive for market share, ships that carry as much as 2 million barrels a trip are in demand to haul crude from the Middle East to Asia and North America. While oil prices fell about 35% in 2015, average earnings for these carriers jumped to $67,366 a day, the most since at least 2009, according to Clarkson, the world’s largest shipbroker. “The stars are aligned for us right now,” Nikolas Tsakos, CEO of Tsakos Energy Navigation, said in an interview at Bloomberg’s New York offices, adding that falling oil prices will likely stimulate demand and cargoes next year. Tanker analysts are predicting the rate boom will persist for many of the same reasons oil forecasters are bearish.

OPEC shows no sign of reversing its market strategy, and Iran has outlined plans to ramp up its exports once economic sanctions against the country are lifted. At the same time, the U.S. just repealed a four-decades old limit on its exports. With on-land inventories already at record levels, this could mean more barrels will eventually be stored on ships, further increasing profit, said Tsakos. The biggest tanker operators who manage fleets from Europe are Euronav, based in Antwerp, Belgium, DHT, Frontline, which runs Norway-born billionaire John Fredriksen’s tanker fleet, and Tsakos Energy in Greece. All have seen their shares rise this year while most energy producers have fallen. “We are benefiting from what is currently a challenging environment for the energy sector,” said Svein Moxnes Harfjeld, joint CEO for DHT. “We expect 2016 to be a rewarding year.”

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America’s very own Greece.

Puerto Rico’s Debt Trap (Simon Johnson)

The Caribbean island of Puerto Rico — the largest United States “territory” — is broke, and a human calamity is unfolding there. Unless a constructive course of political action is found in 2016, Puerto Rican migration to the 50 states will rival the scale of the 1930s Dust Bowl exodus from Oklahoma, Arkansas, and other climate-devastated states. With public debt service (principal plus interest) projected to reach nearly 40% of government revenue in 2016, Puerto Rico needs a new set of economic policies. But austerity will not work; this must be an investment-led recovery, with official measures oriented toward boosting growth by reducing the cost of doing business. The question is whether Puerto Rico will have that option.

Much of its $73 billion debt has been issued by government corporations. But, though federal law allows such municipal debt to be restructured under Chapter 9 of the bankruptcy code in all 50 states, this does not apply to U.S. territories like Puerto Rico. As a result, a protracted series of confusing legal battles and selective defaults looms. The cost of essential infrastructure services — electricity, water, sewers, and transportation — will go up while quality declines. One response has been to demand further belt-tightening, for example, in the form of wage reductions and health care cuts. But residents of Puerto Rico are also U.S. citizens and they vote with their feet — the population has fallen from 3.9 million to 3.5 million in recent years as talented and energetic people have moved to Florida, Texas, and other parts of the mainland.

The more creditors insist on lower living standards and higher taxes, the more the tax base will simply leave the island — causing bondholders’ losses to rise. Disorganized defaults by public corporations will make it hard for any part of the private credit system to function. Leading conservatives in the U.S. — including at the Hoover Institution — have long argued in favor of using established bankruptcy procedures when large financial firms fail. The same logic applies here: A judge can remove any doubt that actual insolvency exists, while also ensuring that credit remains available during a restructuring. During that process, a judge can rely on precedent and ensure fairness across creditor classes based on the precise terms under which loans were obtained.

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Oh good lord, Joe Stalwart Weisenthal…

Marc Faber Seeing Recession Clashes With Yellen, Likes Treasuries (BBG)

Marc Faber recommends Treasuries and says the U.S. is at the start of an economic recession, clashing with Federal Reserve Chair Janet Yellen’s view that things are improving. “Ten-year U.S. Treasuries are quite attractive because of my outlook for a weakening economy,” Faber, the publisher of the Gloom, Boom & Doom Report, said on Monday. “I believe that we’re already entering a recession in the United States” and U.S. stocks will fall in 2016, he said. Yellen raised interest rates this month for the first time in almost a decade and said Americans should take the decision as a sign of confidence in the U.S. economy. Analysts differ over whether the Fed’s decision to increase its benchmark came at the right time because the inflation rate is stuck near zero even as gross domestic product expands.

The benchmark U.S. 10-year note yield rose 2 basis points, or 0.02 percentage point, to 2.25% as of 8:31 a.m. in New York, according to Bloomberg Bond Trader prices. The price of the 2.25% security due in November 2025 fell 6/32, or $1.88 per $1,000 face amount, to 99 31/32. Treasuries have returned 1.1% in 2015, down from 6.2% last year, based on Bloomberg World Bond Indexes. U.S. economic growth slowed to an annualized 2% rate last quarter from 3.9% in the previous three months, the Commerce Department said Dec. 22. The last time the economy was in a recession was December 2007 until June 2009, according to the National Bureau of Economic Research. “While things may be uneven across regions of the country and different industrial sectors, we see an economy that is on a path of sustainable improvement,” Yellen said Dec. 16 after the Fed increased its benchmark rate by a quarter percentage point.

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Bank bailouts and bail-ins are Italy’s political powder keg.

World’s Oldest Bank Sells Bad Loans To Deutsche (BBG)

Banca Monte dei Paschi di Siena agreed to sell non-performing loans with a book value of about €1 billion to Epicuro SPV, a company backed by affiliates of Deutsche Bank, as the world’s oldest bank seeks to shore up its finances. Most of the loans became non-performing before 2009, the Italian bank said in a statement on Monday. The deal will have a negligible impact on Monte Paschi’s earnings and be completed by the end of the year. The portfolio is composed of almost 18,000 borrowers. CEO Fabrizio Viola is bolstering the bank’s finances by reducing risk and divesting assets after tapping investors twice in less than two years. In June, Monte Paschi sold €1.3 billion of non-performing loans to Cerberus Capita and Banca Ifis.

The portfolio sale is consistent with Monte Paschi’s 2015 to 2018 business plan, which forecasts as much as €5.5 billion of NPL disposals, according to a note from brokerage Fidentiis, which has a sell rating on the bank’s shares. The Siena, Italy-based lender said Dec. 16 that it will restate its financial accounts to comply with a request from Italy’s stock-market watchdog Consob that the bank change how it booked a transaction with Nomura. Consob asked the bank to amend its 2014 and first-half accounts to reflect the deal dubbed Alexandria should be treated as a credit-default swap instead of a repurchase agreement.

Milan prosecutors found new information this year as they investigated the transaction, which the former management had used to hide losses, the bank said, citing Consob’s request. The restatement should have a positive impact of €714 million before taxes on 2015 results, while it will be neutral on capital. Monte Paschi has been engulfed by legal probes into former managers who had covered losses with the Nomura transaction and a similar deal with Deutsche Bank. The lender is now seeking a buyer to help restore profit as bad loans mount.

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Can’t help wondering what Beppe is thinking right now. He never wanted M5S to get caught up in the poisonous Italian mainstream politics.

Italy’s Five Star Movement on the Rise (FT)

When the populist Five Star Movement burst into Italian politics in 2009 during the financial crisis, it was defined by uncompromising protests and the burly, sardonic figure of its leader, the comedian Beppe Grillo. But the Five Star Movement is now attempting to change its face from that of one of Europe s most eccentric -even clownish political parties. The transformation aims to achieve what seemed like a fantasy only a year ago: to govern the country and challenge the centre-left government led by prime minister Matteo Renzi. Mr Grillo, 67, has removed his name from the party logo, signalling that he may soon step aside. His most likely heir is Luigi Di Maio, a 29-year-old smooth-talking Neapolitan with polished looks, tight-fitting dark suits and moderate tones.

The perception of the movement has changed, Mr Di Maio tells the FT. At the beginning there was the idea that this was a protest movement .. “But we crashed through that wall. We want to govern”. The odds of that happening are increasing. The Five Star Movement is now Italy s second party. After trailing Mr Renzi s Democratic party by nearly 20 percentage points a year ago, recent polls suggest the margin has shrunk to about 5 percentage points, 32% to 27%. The Five Star Movement is certainly in the best shape of all of Renzi’s challengers, and he is scared of them, says Gianfranco Pasquino, a professor of political science at SAIS-Europe in Bologna. That the Five Star Movement even has a shot at threatening Mr Renzi says much about the waning political momentum suffered by the 40-year former mayor of Florence, who took office in February 2014 amid high hopes that he could transform Italy.

The economy is growing again after years of stagnation and recession. But the gains have not been broadly felt. “People are discouraged, disappointed and still angry”, Roberto D Alimonte, a political-science professor at Luiss university in Rome, says. The recovery has not filtered down. Mr Di Maio has certainly been honing his message against the prime minister. “Renzi seemed like a new face but it didn’t take much to understand that he was moving in the direction of the same old way of governing this country”, he says. But convincing Italians that the Five Star Movement is a credible alternative remains a tall order since many still see it as a party of pure obstruction and opposition. Mr Grillo’s best known political slogan when he launched the movement was “vaffanculo”, an earthy expletive aimed at the establishment. And he has refused to consider being part of any coalition government.

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I really don’t really want to spend time on Trump, or US politics in general, but Taibbi does a way above par analysis.

In the Year of Trump, the Joke Was On Us (Matt Taibbi)

A pre-2015 Trump fantasy was probably something like romping with models after simultaneously winning the Nobel Prizes for Peace, Literature and Physics (they love me in Sweden – scientists were amazed by the size of my skyscraper!). He almost certainly would have been grossed out by a Ghost-of-Christmas-Future-style image of his 2015 self being feted by crowds of rifle-toting white power nerds. But shortly after Trump jumped into the race, he stumbled onto a secret: whenever he blurted out forbidden thoughts about race, ethnicity or gender, he was showered with the attention he always craved. A sizable portion of the country seemed appalled at the things he said. But at the same time he was suddenly attracting huge and adoring crowds at down-home sites like Bluffton, South Carolina and Mobile, Alabama, pretty much the last places you’d ever expect the Trump brand to take off.

Trump had spent his entire career lending his name to luxury properties that promised exclusivity and separation from exactly the sort of struggling Joes who turned out for these speeches. If you live in a Trump building in a place like the Upper West Side, it’s supposed to mean that you’re too cosmopolitan, stylish, and successful – too smart-set – to mix with the rabble. But the rabble – white, working-class, rural, despising exactly those big-city elites who live in Trump’s buildings – turned out to be Trump’s base. They’re the people who hooted and hollered every time he said something off-color about Muslims or Mexicans or Asians (“We want deal!” Trump snickered earlier this year, in a Chinese-waiter voice) or “the blacks.” It was a bizarre marriage, but it made sense from from a clinical point of view. Attention is attention.

Patient with narcissistic personality disorder discovers massive source of narcissistic supply, so he sets about securing its regular delivery. So one comment about Mexicans turned into another about Megyn Kelly’s “wherever,” which turned into a call for a Black Lives Matter protester to be “roughed up,” which turned into an insane slapstick routine about a Times reporter with arthrogryposis, and so on. By December, you had to check Twitter every few hours just to see which cultural taboo Trump was stomping on now. The presidential campaign Trump began as just the latest in a long line of zany self-promotional gambits has now turned into the long-delayed other shoe dropping from the American civil rights movement. This goofball billionaire mirror-gazer has unleashed a half-century of crackpot grievances about the post-civil rights cultural landscape that a plurality of seething white people felt they never had permission to air, until he came along.

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“Turkey has gone from being viewed by Western government officials, media and academics as an influential, moderating force for regional stability and economic growth, to a tacit supporter, if not outright sponsor, of international terrorism.”

Turkey’s Dangerous Game in Syria (WSJ)

When the Syrian civil war broke out in 2011, Turkey was one of the earliest countries to invest heavily in the overthrow of the Assad regime. Despite a decade of warming relations with Syria, President Recep Tayyip Erdogan was making a bid to become the region’s dominant power. The situation in Syria has since changed dramatically—but the Erdogan strategy has not. The result is that Turkey has become a barrier to resolving the conflict. It wages war on the Syrian Kurds, Islamic State’s most effective opponents. And the country now plays host to an elaborate network of jihadists, including ISIS. Early on, Turkey wanted to foster a Sunni majority government in Syria, preferably run by the local branch of the Muslim Brotherhood.

This would deprive Turkey’s two historical rivals, Russia and Iran, of an important client state, while allowing it to gain one of its own. The plan was simple and elegant. But the Assad regime proved more resilient than expected, and the West refused to intervene and deliver a coup de grâce. So-called moderate Syrian rebels have either been sidelined by Islamist militants, or revealed to have been Islamist militants themselves. Thanks to Islamic State, the war has spread to engulf half of Iraq. And yet, as a global consensus solidified about the importance of defeating ISIS, Turkey has continued to play the game as if it were 2011. This summer, for example, the Erdogan government came to an important agreement to let the U.S. use two of its air bases for strikes against ISIS.

Yet Turkey has used the same bases to attack Kurdish forces in Iraq and Syria. The Erdogan government remains more concerned with limiting the power of the Kurds in Syria than with defeating ISIS. Turkey has gone from being viewed by Western government officials, media and academics as an influential, moderating force for regional stability and economic growth, to a tacit supporter, if not outright sponsor, of international terrorism. It is also viewed as a dangerous ally that risks plunging NATO into an unwanted conflict with Russia. When Russian President Vladimir Putin labeled the Erdogan government “accomplices of terrorists” after its fighter planes downed a Russian jet on Nov. 24, he was bluntly rewording an accusation that has been made repeatedly, but more diplomatically, in the West.

The accusation: Turkey allows oil and artifacts looted by Islamic State to flow across its border in one direction, while foreign jihadists, cash and arms travel in the other. Speaking last year of the porous Turkey-Syria border, Vice President Joe Biden let slip, in a moment of candor, that the biggest problem the U.S. faced in confronting ISIS was its own allies. More recently, on Nov. 27, a senior Obama administration official described the situation to this newspaper as “an international threat, and it’s all coming out of Syria and it’s coming through Turkish territory.”

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Throw in eye-watering corruption and you have a lot of misery. Thanks, Victoria Nuland!

Ukraine Inflation Hits 44% Amid Economic Collapse (Telegraph)

Inflation will hit 44pc in Ukraine this year, as the embattled economy has seen prices soar amid economic collapse. Consumer prices have hit eye-watering levels in 2015, according to the country’s central bank governor. Inflation averaged 24.9pc in 2014. Valeria Gontareva, of the National Bank of Ukraine, said authorities were aiming to get inflation to around 5pc by 2019. The war-torn economy, which has been plunged into crisis following conflict with neighbouring giant Russia, will also start to gradually lift capital controls as it begins to receive disbursements of bail-out cash from international lenders, said Ms Gontareva. Ukraine is set to receive around $9bn in rescue cash in 2016, including $4.5bn from the IMF, $1.5bn from the EU, and $1bn loan guarantee from the United States, which will be released in the first quarter of next year.

The economy has also lumbered under capital controls which limit the purchasing of foreign exchange in a bid to protect the collapsing value of the hryvnia. Bail-out cash will also help boost Ukraine’s dwindling foreign exchange reserves, which have steadily grown over the last months to stand at $13.3bn in December. Ukraine has been locked in a stalemate with Moscow over the repayment of a $3bn bond. Kiev defaulted on the debt earlier this month after Russian authorities refused to take part in a private sector debt haircut. The issue has also stoked tensions with the IMF, which changed its lending rules to continue providing aid to governments who fall into arrears. But Ukraine’s central bank chief said there was now no “hindrance” to the release of IMF aid to the country in 2016. “The IMF mission has agreed everything, they don’t need to come to Kiev anymore.”

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Frontex are the vanguard of an occupation force.

Frontex Sends 300 Guards In Migrant Mission To Greece (AFP)

EU border agency Frontex said Tuesday it had started to deploy 293 officers and 15 vessels on Greek islands to help Athens cope with the massive influx of migrants to its shores. The guards “will assist in identifying and fingerprinting of arriving migrants, along with interpreters and forged document experts,” Frontex said in a statement. “The number of border guards deployed will gradually increase to over 400 officers as well as additional vessels, vehicles and other technical equipment,” it added. More than one million migrants and refugees have landed in Europe this year, with more than 800,000 coming via Greece. At least 3,692 have died attempting to reach Europe across the Mediterranean, according to the International Organization for Migration (IOM).

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Topping off the misery. What everyone feared would happen. Kostas and his crew are handing out warm blankets like crazy.

Heated Areas To Open To Homeless In Athens As Cold Snap Expected (Kath.)

Municipal authorities in Athens are bracing for a cold snap at the end of the week and are opening emergency shelters for the capital’s homeless. Heated halls will be open to vulnerable groups from 10 a.m. on Wednesday at 35 Alexandras Avenue and at the indoor gymnasium opposite 165 Pireos Street. They will remain open until the cold snap ends, which is expected to happen on the weekend. The National Meteorological Service on Tuesday said that temperatures in the capital are expected to drop on Thursday and Friday to nighttime lows of below 0 degrees Celsius (32 Fahrenheit), with a chance of snow in northern parts. The cold weather is also expected to grip other parts of the country, particularly in the north, where authorities are also taking steps to provide warm spaces for vulnerable groups.

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F**king Amen, brother. “I was a stranger, and ye took me not in: naked, and ye clothed me not.”

As Europe Turns Gray (Pantelis Boukalas)

While the religious leaderships of Christian Europe went to pains to remind their faithful in their Christmas messages that Christ and his family were also refugees, Europe’s political leadership did not appear particularly moved – even less so great chunks of the societies that shape the contradictory and self-seeking face of Europe. The fact is that gray is about the most hopeful color that this part of the bloc can be colored, and it has covered much of its area. This is evidenced by elections and public opinion polls in France, Austria, the Czech Republic, Slovakia, the Netherlands and of course Greece, where the rot of racism from the far-right part of those nations is marring the heartfelt expressions of solidarity from so many other members of their societies.

This is also confirmed by the spike in hate attacks: Molotov cocktails launched at refugee camps, anti-refugee rallies, attacks on foreigners, sacred sites and symbols of non-Christian religions, enthusiasm for fences and barricades etc. This gray rot is insidious and threatens to swallow up all that is bright and gives birth to the solidarity shown toward migrants and refugees by those who have chosen to take action in the face of intolerance: people who act in the proper Christian spirit even if they are atheists, agnostics or of another faith. In an atmosphere where consumption fever and the commercialized “Christmas spirit” leaves little room for the true spirit of giving without expecting anything in return to flourish, the symbol of Christ as the political refugee becomes inert.

You cannot use him as a paradigm because he too will become another irritating figure without a home, someone belonging to a bygone era, unwanted and shunned. The fugitive Christ is born and dies every day in the faces of the children that drown in the Aegean or in the waters off Italy, Spain and France. He dies every day in front of the walls of a West that knows how to create wave upon wave of refugees through its cold, calculating actions but is indifferent to helping the victims.

The human mind cannot predict divine will. But maybe it is not blasphemous to speculate that if the Son of God were at Stephansplatz in Vienna last week – during the time of the year meant to celebrate his birth – and seen the disgusting performance of hate staged by far-right “thespians” (men in hoods posing as jihadists, beheading Europeans holding signs welcoming refugees), he would have been unable not to utter the words: “I was a stranger, and ye took me not in: naked, and ye clothed me not.”

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