Sep 162019
 
 September 16, 2019  Posted by at 9:20 am Finance Tagged with: , , , , , , , , , , ,  21 Responses »


Pablo Picasso Night fishing at Antibes 1939

 

Oil Explodes 20% Higher, Biggest Jump On Record (ZH)
Trump Says US ‘Locked And Loaded’ As Iran Blamed For Saudi Attack (AP)
Liquidity Dies in Darkness (Rivelle)
‘Very Difficult’ For China’s Economy To Grow 6% Or Faster: Premier Li
China’s August Industrial Output Growth Grinds To 17.5-Year Low (R.)
General Motors Faces Strike By Almost 50,000 Staff (BBC)
OxyContin Maker Purdue Pharma Files For Bankruptcy Protection (R.)
Industrialized Militaries Are A Big Part Of The Climate Emergency (IC)
Farming Subsidies Destroy The World (G.)
The World’s Most Important Political Prisoner (Craig Murray)

 

 

It went down a little after, but then the war threats started.

Oil Explodes 20% Higher, Biggest Jump On Record (ZH)

Shanghai Oil futures are halted limit up.


Source: Bloomberg

With traders in a state of near-frenzy, with a subset of fintwit scrambling (and failing) to calculate what the limit move in oil would be (hint: there is none for Brent), moments ago brent reopened for trading in the aftermath of Saturday’s attack on the “world’s most important oil processing plant”, and exploded some 20% higher, to a high of $71.95 from the Friday $60.22 close, its biggest jump since futures started trading in 1988. As Bloomberg notes, “for oil markets, it’s the single worst sudden disruption ever, surpassing the loss of Kuwaiti and Iraqi petroleum supply in August 1990, when Saddam Hussein invaded his neighbor. It also exceeds the loss of Iranian oil output in 1979 during the Islamic Revolution, according to data from the U.S. Department of Energy.”

Furthermore, in light of news that the Saudi outage could last for months, this could be just the start. As a reminder, according to Morningstar research director, Sandy Fielden, “Brent could go to $80 tomorrow, while WTI could go to $75… But that would depend on Aramco’s 48-hour update. The supply problem won’t be clear right away since the Saudis can still deliver from inventory.” Of course, should Aramco confirm that the outage – which has taken some 5.7mmb/d in Saudi output after 10 drones struck the world’s biggest crude-processing facility in Abqaiq and the kingdom’s second-biggest oil field in Khurais – will last for weeks, expect the crude juggernaut to continue until the price hits $80, and keeps moving higher.


Source: Bloomberg

Read more …

Does any of this make any sense to you?

Trump Says US ‘Locked And Loaded’ As Iran Blamed For Saudi Attack (AP)

The U.S. government produced satellite photos showing what officials said were at least 19 points of impact at two Saudi energy facilities, including damage at the heart of the kingdom’s crucial oil processing plant at Abqaiq. Officials said the photos show impacts consistent with the attack coming from the direction of Iran or Iraq, rather than from Yemen to the south. Iraq denied Sunday that its territory was used for an attack on the Kingdom and U.S. officials said a strike from there would be a violation of Iraq’s sovereignty. The U.S. officials said additional devices, which apparently didn’t reach their targets, were recovered northwest of the facilities and are being jointly analyzed by Saudi and American intelligence.

The officials, who spoke on condition of anonymity to discuss intelligence matters, did not address whether the drone could have been fired from Yemen, then taken a round-about path, but did not explicitly rule it out. The attacks and recriminations are increasing already heightened fears of an escalation in the region, after a prominent U.S. senator suggested striking Iranian oil refineries in response to the assault, and Iran warned of the potential of more violence. “Because of the tension and sensitive situation, our region is like a powder keg,” said Iranian Brig. Gen. Amir Ali Hajizadeh. “When these contacts come too close, when forces come into contact with one another, it is possible a conflict happens because of a misunderstanding.”


[..] “Amid all the calls for de-escalation, Iran has now launched an unprecedented attack on the world’s energy supply,” Pompeo wrote. “There is no evidence the attacks came from Yemen.” [..] U.S. officials previously alleged at least one recent drone attack on Saudi Arabia came from Iraq, where Iran backs Shiite militias. Those militias in recent weeks have been targeted themselves by mysterious airstrikes, with at least one believed to have been carried out by Israel. Iranian Foreign Ministry spokesman Abbas Mousavi on Sunday dismissed Pompeo’s remarks as “blind and futile comments.” “The Americans adopted the ‘maximum pressure’ policy against Iran, which, due to its failure, is leaning toward ‘maximum lies,’” Mousavi said in a statement.

Read more …

“Trouble is, while loanable funds can be created without limit, the things that can be purchased with these funds is finite.”

Liquidity Dies in Darkness (Rivelle)

If democracy dies in darkness, so does liquidity in that embodiment of economic democracy, i.e., the capital markets. When information is scarce, investors must color in between the lines. That which is not known nor well quantified must be assumed or modeled. The door is therefore open to different investors reaching quite different conclusions about the underlying value of an asset leading, of course, to illiquidity. More so perhaps than any other in history, this cycle is the wellspring of the theories and actions of the central bankers who, in their infinite wisdom, determined that they could model interest rates better than markets could price them. Central banks have flooded the system with what they call “liquidity” but which are actually nothing more–nor less–than electronically conjured “loanable funds.”


Under the banner of “doing whatever it takes,” trillions in loanable funds were created so that now $17 trillion in global debt is priced to yield less than nothing. The magic trick of inverting economic logic with negative rates results from the capacity of the central banks to create unlimited quantities of loanable funds at no cost. Trouble is, while loanable funds can be created without limit, the things that can be purchased with these funds is finite. But, “free money” not only makes loans cheap, it also erodes the capacity of lenders to ask for such reasonable terms as traditional loan covenants and basic financial disclosure.

Read more …

Preparing the people for bad news?!

‘Very Difficult’ For China’s Economy To Grow 6% Or Faster: Premier Li

Chinese Premier Li Keqiang said it is “very difficult” for China’s economy to grow at a rate of 6% or more because of the high base from which it was starting and the complicated international backdrop. The world’s No.2 economy faced “certain downward pressure” due to slowing global growth as well as the rise of protectionism and unilateralism, Li said in an interview with Russian media which was published on the Chinese government’s website, gov.cn. China’s GDP grew 6.3% in the first half of the year, and Li said the economy was “generally stable” in the first eight months of the year.


“For China to maintain growth of 6% or more is very difficult against the current backdrop of a complicated international situation and a relatively high base, and this rate is at the forefront of the world’s leading economies,” Li was quoted as saying. Analysts say China’s economic growth has likely cooled further this quarter from a near 30-year low of 6.2% in April-June. Morgan Stanley says it is now tracking the lower end of the government’s full-year target range of around 6-6.5%.

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4.4% it is.

China’s August Industrial Output Growth Grinds To 17.5-Year Low (R.)

The slowdown in China’s factory and consumer sectors deepened in August, with industrial production growing at the weakest pace in 17-1/2 years, a sign of increasing weakness in an economy lashed by trade headwinds and soft domestic demand. Production rose 4.4% in August year-on-year, slower than the 4.8% growth in July. Analysts polled by Reuters had forecast output would rise 5.2%. August’s data is the slowest growth since February 2002. [..] The data also showed retail sales growth at 7.5%, below the 7.9% expected in a Reuters poll and the 7.6% increase in July.


Fixed-asset investment for the first eight months of the year rose 5.5%, according to data published by the National Bureau of Statistics, compared with a 5.6% rise forecast by analysts. Data last week showed factory-gate prices fell at their fastest pace in three years and analysts predict that producer deflation will continue to worsen in the coming months. It also follows a factory survey that showed activity shrank for the fourth straight month as the U.S. trade war dragged on. China’s imports of unwrought copper also fell 3.8% year-on-year in August, a metal with wide use in infrastructure, power and consumption.

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America’s dying unions.

General Motors Faces Strike By Almost 50,000 Staff (BBC)

Almost 50,000 General Motors workers have been called out on strike after the car giant failed to reach a pay and conditions deal with the United Auto Workers union (UAW). “We do not take this lightly. This is our last resort,” UAW vice-president Terry Dittes told reporters in Detroit. The sides had set a Saturday night deadline to reach agreement. The strike – from midnight (04:00 GMT) on Monday – is the first at GM, America’s biggest carmaker, since 2007. In that strike, a two-day stoppage cost $300m (£240m). The union’s previous four-year contract with GM expired this weekend, and the two sides had been holding negotiations on wide-ranging issues, including wages, healthcare, profit sharing, and job security.

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Right after the Sackler family had transferred their billions to safe locations.

OxyContin Maker Purdue Pharma Files For Bankruptcy Protection (R.)

OxyContin maker Purdue Pharma LP filed for bankruptcy protection Sunday night, succumbing to pressure from more than 2,600 lawsuits alleging the company helped fuel the deadly U.S. opioid epidemic. Purdue’s board met Sunday evening to approve the long-expected bankruptcy filing, which the company is pursuing to restructure under terms of a proposal to settle the widespread litigation. Purdue, which filed for Chapter 11 protection in a federal bankruptcy court in White Plains, New York, reached a tentative deal to resolve lawsuits with 24 states and five U.S. territories, as well as lead lawyers for more than 2,000 cities, counties and other plaintiffs, the company said.


Two dozen states remain opposed or uncommitted to the proposed settlement, setting the stage for contentious legal battles over who bears responsibility for a public health crisis that has claimed the lives of nearly 400,000 people between 1999 and 2017, according to the latest U.S. data. Thousands of cities and counties, along with nearly every state, have sued Purdue and, in some cases, its controlling Sackler family. The lawsuits, seeking billions of dollars in damages, claim the company and family aggressively marketed prescription painkillers while misleading doctors and patients about their addiction and overdose risks.

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I’d rather have a look at overall pollution, not just emissions.

Industrialized Militaries Are A Big Part Of The Climate Emergency (IC)

A British doctor who co-authored two studies on the environmental impact of U.S. military operations in Fallujah said that the city’s population suffers “the highest rate of genetic damage in any population ever studied.” Much of this impact can be blamed on the use of depleted uranium munitions by U.S. forces. Despite vowing to cease their use, a study by the independent monitoring group Airwars and Foreign Policy Magazine found that the military continued to use the toxic munitions during its most recent bombing campaign in Syria. The fact that fossil fuel emissions have been the major driver of climate change adds another grim irony to these wars.


For decades, the heavy U.S. military footprint in the Middle East has been justified by the need to preserve access to the region’s oil reserves. The industrial extraction of those same reserves has been one of the major drivers of global carbon dioxide emissions. In other words, we have been killing, dying, and polluting to ensure our access to the same toxic resource most responsible for our climate disruption. It took this perfect symmetry between industrial warfare and industrial exploitation of the earth to bring about the unspeakable emergency we now face.

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$1 million every minute. And look at the sugary crap we’re eating.

Farming Subsidies Destroy The World (G.)

The public is providing more than $1m per minute in global farm subsidies, much of which is driving the climate crisis and destruction of wildlife, according to a new report. Just 1% of the $700bn (£560bn) a year given to farmers is used to benefit the environment, the analysis found. Much of the total instead promotes high-emission cattle production, forest destruction and pollution from the overuse of fertiliser. The security of humanity is at risk without reform to these subsidies, a big reduction in meat eating in rich nations and other damaging uses of land, the report says. But redirecting the subsidies to storing carbon in soil, producing healthier food, cutting waste and growing trees is a huge opportunity, it says.

The report rejects the idea that subsidies are needed to supply cheap food. It found that the cost of the damage currently caused by agriculture is greater than the value of the food produced. New assessments in the report found producing healthy, sustainable food would actually cut food prices, as the condition of the land improves. “There is incredibly small direct targeting of [subsidies at] positive environment outcomes, which is insane,” said Jeremy Oppenheim, principal at the Food and Land Use Coalition (Folu), the collaboration of food, farming and green research groups that produced the new report. “We have got to switch these subsidies into explicitly positive measures.”


He said the true global total was likely to be $1tn a year, as some subsidies are difficult to quantify precisely: “That trillion dollars of public funding is available and is a massive, massive lever to incentivise the farming community across the world to act differently.”

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“..all the excuses for Assange’s imprisonment which so-called leftists and liberals in the UK have hidden behind will evaporate.”

The World’s Most Important Political Prisoner (Craig Murray)

We are now just one week away from the end of Julian Assange’s uniquely lengthy imprisonment for bail violation. He will receive parole from the rest of that sentence, but will continue to be imprisoned on remand awaiting his hearing on extradition to the USA – a process which could last several years. At that point, all the excuses for Assange’s imprisonment which so-called leftists and liberals in the UK have hidden behind will evaporate. There are no charges and no active investigation in Sweden, where the “evidence” disintegrated at the first whiff of critical scrutiny. He is no longer imprisoned for “jumping bail”.

The sole reason for his incarceration will be the publishing of the Afghan and Iraq war logs leaked by Chelsea Manning, with their evidence of wrongdoing and multiple war crimes. In imprisoning Assange for bail violation, the UK was in clear defiance of the judgement of the UN Working Group on arbitrary Detention, which stated:

“Under international law, pre-trial detention must be only imposed in limited instances. Detention during investigations must be even more limited, especially in the absence of any charge. The Swedish investigations have been closed for over 18 months now, and the only ground remaining for Mr. Assange’s continued deprivation of liberty is a bail violation in the UK, which is, objectively, a minor offense that cannot post facto justify the more than 6 years confinement that he has been subjected to since he sought asylum in the Embassy of Ecuador. Mr. Assange should be able to exercise his right to freedom of movement in an unhindered manner, in accordance with the human rights conventions the UK has ratified,”


In repudiating the UNWGAD the UK has undermined an important pillar of international law, and one it had always supported in hundreds of other decisions. The mainstream media has entirely failed to note that the UNWGAD called for the release of Nazanin Zaghari-Ratcliffe – a source of potentially valuable international pressure on Iran which the UK has made worthless by its own refusal to comply with the UN over the Assange case. Iran simply replies “if you do not respect the UNWGAD then why should we?”

Read more …

 

 

 

 

 

Sep 152019
 
 September 15, 2019  Posted by at 9:26 am Finance Tagged with: , , , , , , , , , , , , , ,  9 Responses »


Marcel Duchamp About young sister 1911

 

Israeli Attacks On Syria Halted After Russian Threat To Shoot Down Jets (ZH)
US, Israel Talk About Mutual Defense Treaty – Trump (RT)
Netanyahu’s Plan to Escape Trial (Haaretz)
US Blames Saudi Oil Strikes On Iran, Not Houthis (BBC)
Global Spare Oil Capacity In US Hands After Saudi Outage (R.)
US Stands Ready To Tap Emergency Oil Reserve After Saudi Attacks (R.)
London Upper Tribunal Rejects La Repubblica’s Assange Docs Appeal (Maurizi)
Johnson Is A Liar Who Only Backed Leave To Help His Career – Cameron (G.)
US To Hit EU With Billions In Tariffs After Victory In Airbus Case (Pol.eu)
Italy’s New Government Lets Charity Ship Head To Italian Port (R.)
World ‘Losing Battle Against Deforestation’ (BBC)
The Spy Who Failed (Ritter)

 

 

What Putin tells Netanyahu, he also tells Trump at the same moment. A red line in the sand. This is the new world order.

Israeli Attacks On Syria Halted After Russian Threat To Shoot Down Jets (ZH)

According to reports in both Israeli and Arabic regional media, Israel this past week was preparing to expand major airstrikes against “Iran-backed” targets in Syria, but Moscow imposed its red line. The Independent has published a story describing that Russia’s military in Syria threatened to shoot down any invading Israeli warplanes using fighter jets or their S-400 system. The Jerusalem Post, citing sources in the UK Independent (Arabia), writes just after the latest meeting in Sochi between Prime Minister Benjamin Netanyahu and Russian President Vladimir Putin: “According to the report, Moscow has prevented three Israeli airstrikes on three Syrian outposts recently, and even threatened that any jets attempting such a thing would be shot down, either by Russian jets or by the S400 Anti-aircraft missiles.


The source cited in the report claims a similar situation has happened twice, and that during August, Moscow stopped an airstrike on a Syrian outpost in Qasioun, where a S300 missile battery is placed.” Netanyahu’s hasty trip to meet with Putin on Thursday – even in the final days before Tuesday’s key election – was reportedly with a goal to press the Russian president on essentially ignoring Israel’s attacks in Syria. Citing further sources in the British-Arabic Independent Arabia, The Jerusalem Post continues: According to the Russian source, Putin let Netanyahu know that his country will not allow any damage to be done to the Syrian regime’s army, or any of the weapons being given to it… Israel sources cited by the Arabic newspaper described Netanyahu’s attempts to persuade Putin as “a failure”. This in spite of Netanyahu telling reporters after the meeting that his relations with Moscow were stronger than ever.

Read more …

Israel is going to defend the US?

US, Israel Talk About Mutual Defense Treaty – Trump (RT)

The US and Israel are discussing a mutual defense treaty that would further cement the already “tremendous” alliance between the two countries, President Donald Trump has revealed. “I had a call today with Prime Minister Netanyahu to discuss the possibility of moving forward with a Mutual Defense Treaty, between the United States and Israel, that would further anchor the tremendous alliance between our two countries,” Trump tweeted. Trump voiced not-that-veiled support for Benjamin Netanyahu ahead of the upcoming parliamentary elections in Israel. “I look forward to continuing those discussions after the Israeli Elections when we meet at the United Nations later this month!” Trump wrote.


The support surely comes in handy, as Netanyahu’s backing appears to be quite shaky. The September 17 polls are the second snap legislative elections this year after Netanyahu failed to form the government back in April. The outcome of the upcoming vote is hard to predict, as Netanyahu’s party, Likud, has almost equal support as their main opponent the Blue and White led by Benny Gantz, opinion polls show. Netanyahu was quick to respond to Trump’s announcement, lauding the prospects of the alliance and managing to call the US president a “friend” twice in a single tweet.

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Netanyahu wanted to bomb Syria to support himself in the Sep 17 Knesset elections. Putin said we’ll shoot down your jets.

Netanyahu needs victory in the election to keep himself out of jail. He may be indicted by mid-October. Trump might want to reconsider who he’s friends with.

Netanyahu’s Plan to Escape Trial (Haaretz)

Immediately after the last election, Prime Minister Benjamin Netanyahu outlined to members of his inner circle a plan to extract him from facing trial. The plan was based on obtaining immunity from the Knesset and passing legislation to prevent the High Court of Justice from removing that immunity. If his bloc wins 61 Knesset seats next week, Netanyahu will presumably resort to this rescue plan. For him it will be the Day of Judgment. “Stop being frightened. It’s time for them to be frightened,” Netanyahu told his confidants, referring to justice officials, headed by Attorney General Avichai Mendelblit and State Prosecutor Shai Nitzan, who have decided to indict him in three cases, subject to a hearing.

Netanyahu told his confidants why he insisted on his destructive plan, telling them he had lost all confidence in the legal system on all levels – the attorney general’s office, the state prosecutor and the court system. “They want me in prison,” he told one of his cronies, noting that if he were indicted that would indeed be the result – not because he had crossed a red line, but merely due to the jurists’ collective hostility toward him and his ideology. Netanyahu appears to wholeheartedly believe himself to be a victim, framed by prosecutors and that Mendelblit, who is weak, doesn’t believe in them at all, but couldn’t withstand the pressure.

In his interviews with the police Netanyahu acted like a hunted man. “It’s a wacky conception,” he told national fraud squad chief Koresh Bar-Nur in January 2017. Bar-Nur came to Netanyahu’s residence with a team of investigators to question him under caution on Case 2000, involving a bribery deal Netanyahu allegedly negotiated with Yedioth Ahronoth publisher Arnon “Noni” Mozes.

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Trump was talking about lifting sanctions on Iran and then this happens?! That smells like Assad attacking his own people with chlorine just as things were getting better.

US Blames Saudi Oil Strikes On Iran, Not Houthis (BBC)

US Secretary of State Mike Pompeo has blamed Iran for Saturday’s drone attacks on Saudi oil facilities. He dismissed a claim by Yemeni Houthi rebels that they had attacked the two facilities, run by state-owned company Aramco. Saudi Arabia’s energy minister said the strikes had reduced crude oil production by 5.7 million barrels a day – about half the kingdom’s output. Correspondents say they could have a significant impact on world oil prices. TV footage showed a huge blaze at Abqaiq, site of Aramco’s largest oil processing plant, while a second drone attack started fires in the Khurais oilfield. The Saudis lead a Western-backed military coalition supporting Yemen’s government, while Iran backs the Houthi rebels.


If the rebels were responsible for the attacks, their drones would have had to fly hundreds of miles from Yemen into central Saudi Arabia. Meanwhile experts are investigating whether the attacks could have been carried out from the north – either by Iran or its Shia allies in Iraq – using cruise missiles rather than drones, the Wall Street Journal reports. Tensions between the US and Iran have escalated in recent months. since US President Donald Trump abandoned a deal limiting Iran’s nuclear activities last year and reinstated sanctions. In a tweet, Mr Pompeo said there was “no evidence” the drones came from Yemen. He described the attack as “an unprecedented attack on the world’s energy supply”.

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The US and Saudi Aramco (its IPO is near) stand to gain most if oil prices shoot up.

Global Spare Oil Capacity In US Hands After Saudi Outage (R.)

An attack on Saudi oil facilities on Saturday is believed to have disrupted half the country’s production capacity, making the United States the only real holder of the global supply cushion via its ability to raise own output or to soften sanctions against other major oil producers. Saudi Arabia has yet to comment on the extent of damage on its oil production but industry sources have said some 5-6 million barrels per day (bpd) or 5-6% of global supply have been affected. Saudi Arabia, the Organization of the Petroleum Exporting Countries’ de-facto leader and largest producer, has been long seen as the custodian of the world’s spare oil capacity.

Spare capacity is the extra oil a producing country can bring onstream and sustain at short notice, providing global markets with a cushion in the event of natural disaster, conflict or any other cause of an unplanned supply outage. Industry sources have said Saudi Arabia will be able to restore supply within days. A prolonged supply outage will have a major bullish impact on oil prices, which in turn will spur further gains in U.S. shale production. The United States has briefly overtaken Saudi Arabia as the world largest crude exporter this year, only a few years after removing a ban on oil exports because of large needs at home as the world’s largest oil consumer.

Analysts have repeatedly underestimated U.S. output growth gains with the country now producing around 15% of global supply. Besides the United States, the only countries which have significant spare capacity are Iran and Venezuela.

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Only to replace it with much more expensive oil?

US Stands Ready To Tap Emergency Oil Reserve After Saudi Attacks (R.)

The Trump administration is prepared to tap U.S. emergency oil reserves if necessary after drone attacks shut oil output in Saudi Arabia, the world’s largest crude exporter, a Department of Energy spokeswoman said. Energy Secretary Rick Perry “stands ready to deploy resources from the Strategic Petroleum Oil Reserves if necessary to offset any disruptions to oil markets as a result of this act of aggression,” spokeswoman Shaylyn Hynes said. Yemen’s Iran-aligned Houthi group claimed credit for Saturday’s attacks on two plants at the heart of Saudi Arabia’s oil industry, including the world’s biggest petroleum processing facility Abqaiq.


Perry directed department leaders to work with the Paris-based International Energy Agency (IEA) “on potential available options for collective global action if needed,” Hynes said. The IEA said on Twitter earlier in the day that it was in contact with Saudi authorities and other major oil-producing nations, and that markets for now are well-supplied. The United States has occasionally coordinated with the IEA on collective draw downs of oil from international reserves. The SPR, held in heavily-guarded underground storage caverns on the Texas and Louisiana coasts, currently holds nearly 645 million barrels, or about the amount the United States consumes in a month.

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Where are the British people protesting this?

London Upper Tribunal Rejects La Repubblica’s Assange Docs Appeal (Maurizi)

The press does not have the right to access the full set of documents on the Julian Assange case. That is what judge Edward Mitchell finally ruled in an appeal taken to the London Upper Tribunal by la Repubblica, after we have spent the last four years trying to access the full documentation to investigate the Assange case and factually reconstruct it.

In an extremely technical judgement just made public and which the judge himself characterises as “unusually long”, Mitchell rejects our legal arguments and states that he believed public knowledge of Mr Assange’s case would not have increased if it was known that the CPS held information from the US State Department or Department of Justice. A rather incredible argument considering that the entire Assange case revolves around the role of the United States authorities, who want to get their hands on the WikiLeaks founder, extradite him to the US and jail him for life: establishing whether the British and US authorities discussed this possibility from the very beginning is crucial.

[..]Our attempt to access the documents has been hindered and hugely delayed in every jurisdiction. However, the very few documents we have obtained so far have allowed us to unearth crucial information. They provide indisputable evidence of the UK’s role in helping to create the legal and diplomatic quagmire which kept Julian Assange arbitrarily detained since 2010, as established by the United Nations Working Group on Arbitrary Detention (UNWGAD). In fact, it was the UK Crown Prosecution Service which advised the Swedish prosecutors against the only judicial strategy that could have brought the Swedish rape investigation to a quick closure: questioning Assange in London, rather than trying to extradite him to Stockholm. It was the Crown Prosecution Service which tried to dissuade the Swedish prosecutors from dropping the case in 2013. Finally, it was the Crown Prosecution Service that wrote to its Swedish counterpart: “Please do not think that the case is being dealt with as just another extradition request” and destroyed crucial documents, even though the case is still ongoing and very controversial.

When we tried to shed light on these facts, to understand why the British authorities acted this way and why the Assange case was not “just another extradition request”, we ran up against a true rubber wall, so much so that we were forced to sue the Crown Prosecution Service. Our first appeal to the London First-tier Tribunal was rejected: the judge established that the press has no right to access the documentation, because the need for the British authorities to protect the confidentiality of the extradition process outweighs the public interest of the press to know. Today, Judge Edward Mitchell has rejected our appeal to the Upper Tribunal. At this point it is not clear who will be able to introduce some transparency and oversight in the Assange case, considering that the press is not allowed to do so.

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Selling a book.

Johnson Is A Liar Who Only Backed Leave To Help His Career – Cameron (G.)

Boris Johnson is a liar who only backed the Leave campaign to help his career and Michael Gove was a “foam-flecked Faragist” whose “one quality” was disloyalty, David Cameron writes in his memoirs. The former prime minister poured vituperation on both his former colleagues Priti Patel, the current home secretary, and Dominic Cummings, the No 10 adviser, in extracts from the book published on Sunday. In what may be Cameron’s most explosive allegation yet, he effectively accused Boris Johnson of mounting a racist election campaign by focusing on Turkey and its possible accession to the EU. “It didn’t take long to figure out Leave’s obsession,” he writes. “Why focus on a country that wasn’t an EU member?


“The answer was that it was a Muslim country, which piqued fears about Islamism, mass migration and the transformation of communities. It was blatant.” Then Cameron echoes the explicitly racist Conservative campaign slogan used in Smethwick in 1964: “They might as well have said: ‘If you want a Muslim for a neighbour, vote “remain”.’” In Smethwick, Peter Griffiths had been elected as Conservative MP on the slogan “If you want a n**** for a neighbour, vote Labour.” Cameron writes that Johnson’s claims of concerns about British sovereignty were “secondary to another concern for Boris: what was the best outcome for him?”

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Get ready for more fun.

US To Hit EU With Billions In Tariffs After Victory In Airbus Case (Pol.eu)

The United States has gotten the green light to impose billions of euros in punitive tariffs on EU products in retaliation for illegal subsidies granted to European aerospace giant Airbus. Four EU officials told POLITICO that the World Trade Organization ruled in favor of the U.S. in the long-running transatlantic dispute and sent its confidential decision to Brussels and Washington on Friday. The decision means that U.S. President Donald Trump will almost certainly soon announce tariffs on European products ranging from cheeses to Airbus planes. One official said Trump had won the right to collect a total of between €5 billion and €8 billion. Another said the maximum sum was close to $10 billion.


The decision sets the stage for a showdown between Europe and Washington just as the EU is transitioning to new leadership under incoming Commission President Ursula von der Leyen and Trade Commissioner-designate Phil Hogan. In unveiling her team on Tuesday, von der Leyen signaled a robust approach to transatlantic disputes on trade and other issues with the Trump administration. aWashington has previously announced it would follow through with tariffs if it won the case in Geneva and has prepared a list of EU exports worth a total of $21 billion. The U.S. can choose products from that list and then tax them at different rates in order to claw back the total amount of damage resulting from the EU subsidies.

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After EU nations agreed to take the refugees.

Italy’s New Government Lets Charity Ship Head To Italian Port (R.)

Italy’s new government allowed a French charity ship to bring ashore 82 migrants on Saturday in an apparent reversal of the uncompromising, closed-door policy of the previous administration. However, Foreign Minister Luigi Di Maio, who heads the 5-Star Movement in the governing coalition, said the Ocean Viking was only being given access to the southern island of Lampedusa because other European states had agreed to take in many of those on board. The government formally took office on Tuesday, promising a fresh approach to migration following the hardline clampdown on rescue ships introduced by former interior minister Matteo Salvini, who heads the far-right League.


Prime Minister Giuseppe Conte said on Thursday that “several EU countries” had agreed to take in the Africans aboard the Ocean Viking but did not give further details. The ship is run by French charities SOS Mediterranee and Doctors Without Borders. It picked up the migrants off Libya earlier this week and had asked both Italy and Malta for permission to dock. Recent such requests from other boats had been rejected, leaving migrants stranded at sea for prolonged periods. The center-left Democratic Party (PD), which has replaced the League in the ruling coalition, applauded the announcement that the vessel had been given access to Lampedusa.

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As long as it pays more to cut and burn trees than to grow them or just leave them alone, this is inevitable.

World ‘Losing Battle Against Deforestation’ (BBC)

A historic global agreement aimed at halting deforestation has failed, according to a report. An assessment of the New York Declaration on Forests (NYDF) says it has failed to deliver on key pledges. Launched at the 2014 UN climate summit, it aimed to half deforestation by 2020, and halt it by 2030. Yet deforestation continues at an alarming rate and threatens to prevent the world from preventing dangerous climate change, experts have said. The critique, compiled by the NYDF Assessment Partners (a coalition of 25 organisations), painted a bleak picture of how the world’s forests continue to be felled.


“Since the NYDF was launched five years ago, deforestation has not only continued – it has actually accelerated,” observed Charlotte Streck, co-founder and director of Climate Focus, which co-ordinated the publication of the report. The report says the amount of annual carbon emissions resulting from deforestation around the globe are equivalent to the greenhouse gases produced by the European Union. On average, an area of tree cover the size of the United Kingdom was lost every year between 2014 and 2018. Tropical forest loss accounts for more than 90% of global deforestation, with the hotspot being located in Amazon Basin nations of Bolivia, Brazil, Colombia and Peru.

Read more …

Your must read for the Sunday. Excellent. You’ll know a lot more about the CIA in Moscow, and in the US elections.

The Spy Who Failed (Scott Ritter)

Oleg Smolenkov was a controlled asset of the CIA. While he was given certain latitude on what information he could collect, generally speaking Smolenkov worked from an operations order sent to him by his CIA controllers which established priorities for intelligence collection based upon information provided by Smolenkov about what he could reasonably access. Before tasking Smolenkov, his CIA handlers would screen the request from an operational and counterintelligence perspective, conducting a risk-reward analysis that weighed the value of the intelligence being sought with the possibility of compromise. Only then would Smolenkov be cleared to collect the requested information.

It is not publicly known what prompted the report from Smolenkov which Brennan found so alarming. Was it received out of the blue, a target of opportunity which Smolenkov exploited? Was it based upon a specific tasking submitted by Smolenkov’s CIA handlers in response to a tasking from above? Or was it a result of the intervention of the CIA director, who tasked Smolenkov outside normal channels? In any event, once Brennan created his special analytical unit, Smolenkov became his dedicated source. If Smolenko was in this for the money, as appears to be the case, he would have been motivated to come up with the “correct” answer to Brennan’s tasking for information on Putin’s role. By late 2016, Western media had made quite clear what kind of answer Brennan wanted.

Every intelligence report produced by a controlled asset is subjected to a counterintelligence review where it is examined for any evidence of red flags that could be indicative of compromise. One red flag is the issue of abnormal access. Smolenkov did not normally have direct contact with Putin, if ever. His intelligence reports would have been written from the perspective of the distant observer. His report about Putin’s role in interfering in the 2016 election, however, represented a whole new level of access and trust. Under normal circumstances, a report exhibiting such tendency would be pulled aside for additional scrutiny; if the report was alarming enough, the CIA might order the agent to be subjected to a polygraph to ensure he had not been compromised.

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Dec 212018
 
 December 21, 2018  Posted by at 10:42 am Finance Tagged with: , , , , , , , , , , , , , , ,  12 Responses »


Pieter Bruegel the Elder Hunters in the snow 1565

 

Dow Drops 470 Points To 14-Month Low In Day 2 Of Big Losses After Fed Hike (CNBC)
As Fear Rises On Wall Street, Strategists Warn The Worst Is Yet To Come (CNBC)
US Defense Chief Mattis Quits As Trump Pulls From Syria, Afghanistan (AFP)
House Passes Spending Bill With Border Wall Money, Senate Showdown Next (CNBC)
China Denies ‘Slanderous’ Economic Espionage Charges From US Allies (R.)
Russian Media Regulator Starts Checking Legality Of BBC’s Operations (R.)
Gatwick Runway Reopens After Days Of Drone Disruption (G.)
There’s A National Emergency All Right – But It Isn’t Brexit (G.)
Germany’s Hidden Crisis – Social Decline In The Heart Of Europe (G.)
Malaysia Seeks $7.5 Billion In Reparations From Goldman Sachs Over 1MDB (R.)
Singapore Said To Expand 1MDB Criminal Probe To Include Goldman Sachs (BBG)
Carlos Ghosn Re-Arrested On New Charges In Japan (BBC)
New Tree Species Became Extinct Before It Was Named (Ind.)

 

 

Jay Powell pricks the bubbles. Painful and inevitable. But if he ever decides to lower rates again next year, look for the bubbles to return. That’s his dilemma.

Dow Drops 470 Points To 14-Month Low In Day 2 Of Big Losses After Fed Hike (CNBC)

U.S. stocks swooned for a second day Thursday after the Federal Reserve raised benchmark interest rates and said that it would continue to let its massive balance sheet shrink at the current pace. Fears of a government shutdown also sent stocks tumbling to new lows Thursday afternoon. The Dow Jones Industrial Average fell 464.06 points to 22,859.6, bringing its two-day declines to more than 800 points and its 5-day losses to more than 1,700 points. The S&P 500 fell 1.5 percent to finish at 2,467.41 as technology stocks underperformed. The Nasdaq Composite fell 1.6 percent and closed at 6,528.41, briefly dipping into bear market territory amid big losses in Amazon and Apple.

The Nasdaq is 19.7 percent below its recent high. Companies in the S&P 500 have lost a total of $2.39 trillion in market cap this month. The Cboe Volatility Index — one of the market’s best gauges of marketplace fear — rose above 30. The Dow and Nasdaq posted their lowest closes since October 2017, while the S&P 500 finished at its lowest level since September 2017. The Dow and S&P 500, which are both in corrections, are on track for their worst December performance since the Great Depression in 1931, down more than 10 percent each this month. The S&P 500 is now in the red for 2018 by 7.7 percent.

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Yeah, all these experts. Who cares? There’s not nearly enough fear yet.

As Fear Rises On Wall Street, Strategists Warn The Worst Is Yet To Come (CNBC)

“The market’s in no man’s land,” said Peter Boockvar, chief investment strategist at Bleakley Advisory Group. Stocks have broken through the lows of the year, and technicians are scurrying to find the next support levels. On the S&P 500, he said 2,400 is a potential psychological area of support. The market plunged Thursday against the backdrop of a congressional feud with the White House over a continuing budget resolution, but the markets were more focused on the worries that have been festering over global growth and the potential for recession. “You can guarantee if the government shuts down it’s going to very soon reopen,” said Boockvar.

“This could be a carry through from yesterday, that’s legitimate. The problem now is this is the first time in years in this bull market that people are doing tax-loss selling. That’s helping to exaggerate the move. You’re also having redemptions.” Since the Fed announced its rate hike Wednesday, the Dow was down 815 points. The sharp drop in stocks since early October was unexpected and even more crushing recently, since December is typically a positive time for stocks. The 10 percent decline so far in the S&P 500 is its worst December performance since 1931. If it remains this way, it would the first time ever that December is the worst month of the year for the index.

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Have all those people who now say Mattis is the wisest and most balanced in the White House, forgotten why he’s called Mad Dog?

US Defense Chief Mattis Quits As Trump Pulls From Syria, Afghanistan (AFP)

US Defense Secretary Jim Mattis resigned Thursday, leading a chorus of protests at home and abroad after President Donald Trump ordered a complete troop pullout from Syria and a significant withdrawal from Afghanistan. Trump steadfastly defended his sudden push for retrenchment, vowing that the United States would no longer be the “policeman of the Middle East” and saying the 2,000-strong US force in Syria was no longer needed as the Islamic State group had been defeated. Mattis, a battle-hardened retired four-star general seen as a moderating force on the often impulsive president, made little attempt to hide his disagreements with Trump.

“Because you have the right to have a secretary of defense whose views are better aligned with yours,” Mattis said in a letter to Trump, “I believe it is right for me to step down from my position.” Mattis hailed the coalition to defeat Islamic State as well as NATO, the nearly 70-year-old alliance between North America and Europe whose cost-effectiveness has been questioned by the businessman turned president. “My views on treating allies with respect and also being clear-eyed about both malign actors and strategic competitors are strongly held and informed by over four decades of immersion in these issues,” Mattis wrote. One day after the surprise announcement on Syria, a US official told AFP that Trump had also decided on a “significant withdrawal” in a much larger US operation – Afghanistan.

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No government into Christmas?

House Passes Spending Bill With Border Wall Money, Senate Showdown Next (CNBC)

The House passed a temporary spending bill Thursday with money for President Donald Trump’s proposed border wall, further muddying the scramble to dodge a partial government shutdown by Friday. The chamber approved the measure to keep the government running into February by a 217-185 vote. But the path forward now is murky. The bill likely will not clear the Senate because it includes more than $5 billion for the border barrier, increasing the chances that funding for seven agencies lapses after the midnight Friday deadline. Senators were told Thursday to prepare for potential votes Friday. The chamber convenes at noon. The Senate unanimously approved a bill Wednesday night to keep the government running through Feb. 8 — without border wall money.

Trump insisted Thursday that he would not sign it. It forced House Republicans to include the wall money in the new bill. Both House Minority Leader Nancy Pelosi and Senate Minority Leader Chuck Schumer have flatly said congressional Democrats will not approve wall money. As Republicans need Democratic votes to pass spending legislation in the Senate, a partial shutdown is all but assured if the GOP insists on funding for the barrier. It is unclear if Republicans will abandon that goal in an effort to keep the government running past Friday. During a televised Oval Office fracas last week, Pelosi challenged Trump by saying he did not have the votes for wall money in the House. It turns out he did.

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We can do it, but they can’t.

China Denies ‘Slanderous’ Economic Espionage Charges From US Allies (R.)

China’s Foreign Ministry said on Friday it resolutely opposed “slanderous” accusations from the United States and other allies criticizing China for economic espionage, urging Washington to withdraw its accusations. The United States should also withdraw charges against two Chinese citizens, the ministry said, adding that China had never participated in or supported any stealing of commercial secrets and had lodged “stern representations” with Washington. “We urge the U.S. side to immediately correct its erroneous actions and cease its slanderous smears relating to internet security,” it said, adding that it would take necessary measures to safeguard its own cybersecurity and interests.

It has long been an “open secret” that U.S. government agencies have hacked into and listening in on foreign governments, companies and individuals, the ministry added. “The U.S. side making unwarranted criticisms of China in the name of so-called ‘cyber stealing’ is blaming others while oneself is to be blamed, and is self-deception. China absolutely cannot accept this.” U.S. prosecutors indicted two Chinese nationals linked to China’s Ministry of State Security intelligence agency on charges of stealing confidential data from American government agencies and businesses around the world. Prosecutors charged Zhu Hua and Zhang Shilong in hacking attacks against the U.S. Navy, the space agency NASA and the Energy Department and dozens of companies. The operation targeted intellectual property and corporate secrets to give Chinese companies an unfair competitive advantage, they said.

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More of the same: We can do it, but they can’t. The west wants to blame RT for all sorts of stuff beacuse that fits the Russophobe narrative.

Russian Media Regulator Starts Checking Legality Of BBC’s Operations (R.)

Russia’s media regulator said on Friday it would carry out checks to determine if the BBC World News channel and BBC internet sites complied with Russian law, a move it described as a response to British pressure on a Russian TV channel. Roskomnadzor, the regulator, said in a statement its checks were Russia’s response to a decision by British media regulator Ofcom, which on Thursday said that Russian broadcaster RT had broken impartiality rules in some of its news and current affairs programs. “The results of our check will be announced separately,” the Russian regulator said. Ofcom said on Thursday it was considering imposing some kind of sanction on RT, which is financed by the Russian state.

It took issue in particular with its coverage of the poisoning in Britain of former Russian spy Sergei Skripal and his daughter. Britain has accused agents working for Russia’s military intelligence agency, the GRU, of committing the crime, an allegation Moscow denies. British Media Secretary Jeremy Wright also weighed in on Thursday, saying what he called RT’s mask as an impartial news provider was slipping. RT rejected Ofcom’s findings, saying Ofcom had ignored its explanations and not paid “due regard” to its rights. Commenting on the launch of the Russian investigation on Friday, Margarita Simonyan, RT’s editor-in-chief, said on Twitter that Ofcom had hinted that it planned to strip her channel of its broadcasting license in Britain. “(Welcome to the) brave new world,” she wrote.

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Days of panic due to one or two drones, at an airport that has just one runway to begin with?!

Gatwick Runway Reopens After Days Of Drone Disruption (G.)

The first flights have resumed at Gatwick airport after a series of drone sightings caused days of disruption, affecting more than 100,000 passengers. Airlines warned customers to continue to check their flight’s status on Friday morning as the airport worked to “introduce a limited number of flights over the coming hours”. The runway had remained closed throughout Thursday night, forcing passengers to search for accommodation or shelter at the airport, and bringing demands for new aviation regulations to tackle the threat. The airport’s chief operating officer, Chris Woodroofe, said 120,000 passengers’ flights had been disrupted by the incident.

On Thursday night police said there had been more than 50 sightings of the drone in 24 hours from when the runway was first closed. Night-flight restrictions had been lifted at other airports, so “more planes could get into and out of the country”, the transport secretary, Chris Grayling said. “This is clearly a very serious ongoing incident in which substantial drones have been used to bring about the temporary closure of a major international airport,” he said. “The people who were involved should face the maximum possible custodial sentence for the damage they have done. The government is doing everything it can to support Sussex police.”

Shooting down the drone was being considered as a “tactical option” after other strategies to stop it had failed. Amid disbelief that the drone incident could be enough to bring one of the UK’s key airports to a standstill, the perpetrator or perpetrators eluded a search conducted by 20 units from two police forces in the surrounding area.

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Britain just stumbles from crisis to crisis, hidden from view by discussions about someone saying Stupid Woman.

There’s A National Emergency All Right – But It Isn’t Brexit (G.)

[..] there is a world beyond Brexit. True, it lacks the frenzied drama of cabinet walkouts, prime ministerial straw-clutching or humiliation served cold in Brussels. But things still happen – it’s just that they haven’t won much attention. It has been a good month to bury bad news. So allow me to disinter some of the headlines deep inside the newspapers. Since we’re counting small things, let’s start with children. Last week it was reported that a primary school in Great Yarmouth had opened its own food bank. It was launched by the headteacher, Debbie Whiting, after she saw pupils under 11 so hungry they were stealing from others’ lunchboxes.

This week, more than half of teachers surveyed by the National Education Union expressed fears that some of their kids won’t have enough to eat this Christmas. They reported a boy turning up wearing his trousers back to front, in order to hide the holes in the knees, and a class where one in three children sleep in their uniforms because they have no pyjamas. If anything qualifies as a national emergency, it should be this. A new generation growing up without adequate food and clothing ought to be leading TV bulletins and shaming government ministers into action. What dominates instead is blue-on-blue match commentary, because Jacob Rees-Mogg is box office while poor people can be slipped in just before the “And finally”.

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“..of all German women in work only one in three earns the minimum wage…”

Germany’s Hidden Crisis – Social Decline In The Heart Of Europe (G.)

The cover of Oliver Nachtwey’s book depicts a VW Beetle, emblem of Teutonic manufacturing prowess since Hitler’s day, driving off a cliff. Is the country that got used to imposing its values on feebler client nations – bailing out southern Europeans with their oversized public sectors, rampant tax avoidance and long lunches – in trouble? The Germany described by this Frankfurt School professor is a basket case – post-growth, post-democratic, with the first fascists in the Bundestag since the Third Reich. Despite being Europe’s richest country, it has higher numbers of working poor than any other EU state; almost one in four of its workers is paid less than the €9.30 (£8.40) minimum wage, many requiring state support.

Sociologist Ulrich Beck in the giddy 1980s called Germany an elevator society, in which millions of skilled workers upgraded from VWs to Audis and expected their children to rise still further in social status and wealth. The elevator may have seized up for a while after reunification, but only five years ago Germany seemed unstoppable. Every German, Beck thought, was in the same lift. No longer. Not only has downward mobility become more evident but the poor get poorer, the rich get richer, the older get tenure, the younger join the precariat. Sure, greater equality of opportunity means more women work than ever before, but of all German women in work only one in three earns the minimum wage.

“So while German women are more equal in terms of rights, inequality between women has never been greater than it is today,” Nachtwey argues. This is symptomatic of what he calls regressive modernisation and of the following paradox: “The more a society is based on equality of opportunity, the more unequal it becomes, and the more legitimate its inequalities”. Legitimate? The losers are perceived to be those who deserve to lose, the winners those who deserve to win. And the losers are the usual suspects – women, immigrants, those who have no qualifications. A Germany that once prided itself on social mobility, and whose sociologists once crazily imagined class distinctions were over, has become, in terms of class, as sclerotic as Britain.

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There’s a class action case looming as well.

Malaysia Seeks $7.5 Billion In Reparations From Goldman Sachs Over 1MDB (R.)

Malaysia is seeking US$7.5 billion in reparations from Goldman Sachs over its dealings with scandal-linked state fund 1MDB, the Financial Times reported on Friday (Dec 21), citing the country’s finance minister. Malaysian prosecutors this week filed charges against Goldman Sachs in connection with its role as underwriter and arranger of three bond sales that raised US$6.5 billion for 1Malaysia Development Berhad (1MDB), the first criminal action against the US bank over the scandal. Goldman Sachs has consistently denied wrongdoing and said certain members of the former Malaysian government and 1MDB lied to the bank about the proceeds of the bond sales.

In addition to the bonds’ total value, Goldman Sachs should also return US$1 billion to cover US$600 million in fees paid to the bank and bond coupons that were “higher than the market rate”, the FT quoted Malaysian finance minister Lim Guan Eng as saying. The three 10-year bonds carried coupons ranging from 4.4 per cent to 5.99 per cent. Lim also told the FT that reparations should at least be more than US$1.8 billion, the sum Goldman Sachs has told investors it had set aside to cover potential losses related to 1MDB legal proceedings. “Their figure is US$1.8 billion. Ours is US$7.5 billion,” Lim said. Goldman Sachs told the FT: “The 1MDB bond offerings were meant to raise money to benefit Malaysia; instead, a huge portion of those funds were stolen for the benefit of members of the Malaysian government and their associates.”

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The squid screwed up royally. But no-one at Goldman will be arrested.

Singapore Said To Expand 1MDB Criminal Probe To Include Goldman Sachs (BBG)

Singapore has expanded a criminal probe into fund flows linked to scandal-plagued 1MDB to include Goldman Sachs, which helped raise money for the entity, people with knowledge of the matter said. Police in the city-state had been examining Goldman’s relationship with the Malaysian state investment company since at least late 2017, but until recently, the firm’s local unit itself wasn’t a focus of any investigation, said the people, asking not to be named discussing sensitive information.

Authorities are trying to determine whether some of the roughly $600 million in fees from the three bond deals Goldman arranged for 1MDB from 2012 to 2013 flowed to the Singapore subsidiary, they said. Singapore’s widened probe opens a potential new battle front for Goldman, less than a week after Malaysia filed the first criminal charges against the firm over a relationship that spawned one of the biggest scandals in its history. Singapore is coordinating closely with the U.S. Justice Department, which is also investigating Goldman and has filed criminal charges against two former senior bankers at the firm, the people said.

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He’s been at it for a while: “..prosecutors now accuse Mr Ghosn of shifting a private investment loss of over $16m onto Nissan in the wake of the 2008 financial crisis.”

Carlos Ghosn Re-Arrested On New Charges In Japan (BBC)

Former Nissan chairman Carlos Ghosn has been re-arrested on fresh charges, Japanese media report, dashing any hopes he could be released on bail. Mr Ghosn has spent the last month in prison, accused of misusing funds and hiding $80m of income. But on Thursday a court rejected a request by the prosecution to extend his detention, which meant he could apply to be released on bail. Friday’s arrest is on a new charge of aggravated breach of trust. According to Japanese broadcaster NHK, prosecutors now accuse Mr Ghosn of shifting a private investment loss of over $16m onto Nissan in the wake of the 2008 financial crisis.

A towering and revered figure in the auto industry, Mr Ghosn has not yet responded to the latest allegation – but he has consistently denied all prior accusations made against him. He was first arrested in Tokyo in November as allegations of financial misconduct surfaced. The BBC’s Mariko Oi says that ever since Carlos Ghosn stepped off his private jet only to be taken into police custody, the case has gripped Japan with speculation rife over what could be behind such a stunning fall from grace. The case has been highly unusual – not least for a high profile chief executive to be spending time in jail – but also because of its legal twists such as yesterday’s when the court rejected an application to extend his detention..

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Animal species are much easier to worry over. Maybe that’s not all that smart.

“..at least six other studies failed to turn up any sign that the tree still exists. Tens of thousands of plant species globally face similar risks.”

New Tree Species Became Extinct Before It Was Named (Ind.)

Scientists have identified a new species of tree that is thought to have become extinct before it was even named. The tree, which has now been called Vepris bali, is believed to have been unique to a forest reserve in west Africa, but forest clearing and agricultural development have wiped it out. Scientists are studying the vepris species for the antimicrobial and antimalarial properties of their essential oils. Researchers hope several other vepris trees will be identified and named in Cameroon before they also disappear. A specimen was collected by a forester, Edwin Ujor, in the Bali Ngemba Forest Reserve in Cameroon in 1951.

The specimen was thought to belong to the genus vepris, which has 80 species, mostly found across Africa. But the tree has not been seen anywhere since. Researchers from the Royal Botanic Gardens, Kew, and the country’s University of Yaoundé I examined the original specimens and used molecular phylogenetic studies to identify the new species. They say the tree is now either critically endangered or already extinct.

Repeated efforts to find the species between 2000 and 2004 and at least six other studies failed to turn up any sign that the tree still exists. Tens of thousands of plant species globally face similar risks. According to the International Plant Names Index, only about 5 per cent of all known species have ever been formally assessed for their extinction risk. The authors wrote: “This makes it a priority to discover, document and protect such species before they become globally extinct.” The Bali Ngemba Forest Reserve, an officially protected forest, is part of the Bamenda highlands, an area so denuded of its natural forest vegetation that it is now known in Cameroon as “the grasslands”.

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Jan 022018
 
 January 2, 2018  Posted by at 10:36 am Finance Tagged with: , , , , , , , , , ,  18 Responses »


Horacio Coppola Avenida de Mayo entre Bolívar y Perú, Buenos Aires 1936

 

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No Financial Stress (Mish)
Bitcoin Is Already Having A Bad Year (BBG)
Bitcoin Fever To Burn Out In ‘Spectacular Crash’ – David Stockman (CNBC)
Britain’s Benefits System Has Become A Racket For Cheating Poor People (G.)
Russia Posts Highest-Ever Natural Gas Output in Expansion Drive (BBG)
US Is Running The Same Script With Iran That It Ran With Libya, Syria (CJ)
More Than 170 Refugees Reach Lesbos, Samos Early New Year’s Day (K.)
Syrian Grandmother Defies Perils To Cross Aegean At Age 110 (K.)
Drones Over Africa Target $70 Billion Illegal Poaching Industry (ZH)

 

 

Article by Mish. Graph annotation by Jesse Colombo.

No Financial Stress (Mish)

As we head into 2018, the St. Loius Fed reports there is no financial stress. The STLFSI measures the degree of financial stress in the markets and is constructed from 18 weekly data series: seven interest rate series, six yield spreads and five other indicators. Each of these variables captures some aspect of financial stress. Accordingly, as the level of financial stress in the economy changes, the data series are likely to move together. The average value of the index, which begins in late 1993, is designed to be zero. Thus, zero is viewed as representing normal financial market conditions. Values below zero suggest below-average financial market stress, while values above zero suggest above-average financial market stress.

Financial stress has been negative since June 18, 2010. I expect 2018 will not be so complacent.

Jesse’s annotations: “Bubbles form during periods of very low financial stress”.

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Check back minutes later and it’s rising.

Bitcoin Is Already Having A Bad Year (BBG)

Bitcoin is already having a bad year. For the first time since 2015, the cryptocurrency began a new year by declining, extending its slide from a record $19,511 reached on Dec. 18. The virtual coin traded at $13,624.56 as of 5 p.m. in New York on Monday, down 4.8% from Friday, according to data compiled by Bloomberg. That’s also a fall from the $14,156 it hit Sunday, according to coinmarketcap.com, which tracks daily prices. The cryptocurrency fluctuated in early Asian trading on Tuesday.

Bitcoin got off to a much stronger start last year, and then kept that momentum going, helping to create a global frenzy for cryptocurrencies. It rose 3.6% on the first day of 2017 to $998, data from coinmarketcap.com show. It ended the year up more than 1,300%. That rally drew a growing number of competitors and last month brought bitcoin to Wall Street in the form of futures contracts. It reached the Dec. 18 peak hours after CME Group Inc. debuted its derivatives agreements, which some traders said would encourage short position-taking.

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Any questions?

Bitcoin Fever To Burn Out In ‘Spectacular Crash’ – David Stockman (CNBC)

David Stockman, President Ronald Reagan’s former director of the Office of Management and a relentless Wall Street bear, is warning investors that the cryptocurrency boom will end disastrously. “It’s basically a class of really stupid speculators who have convinced themselves that trees grow to the sky,” he told CNBC’s “Futures Now” last week. “It will burn out in a spectacular crash. All of these latter-day speculators will have their hands burned to a crisp, and they will learn the proper lesson.” Stockman’s latest prophecy isn’t exclusive to bitcoin. He’s been saying a “gigantic, horrendous storm” could soon hit stocks. In September, he warned investors that a 40% to 70% correction wasn’t too far down the road. On Friday, the Dow Jones Industrial Average flirted with 25,000, with the S&P trading just shy of a new record.

Stockman blamed the Federal Reserve and central banks for creating the hype surrounding the stock and cryptocurrency markets. He argued that too much liquidity was pumped into the marketplace to deal with the 2008 global financial crisis — noting that not even regulators can improve the frothy situation. “What we really need to do is not think these are regulator problems, but understand they’re monetary problems,” he said. “It’s an irrational, overheated market like never before.” In the past two years, bitcoin prices have soared by more than 3,000%. Its wild price swings have sparked debates on Wall Street over how much it’s really worth. Bitcoin’s less expensive peers such as litecoin and ether have also surged. Stockman can’t put a price tag on them.

“I have no idea. I mean it could double or triple from here or it could fall to zero. But the point is that it’s not real money because real money for transactions has to be stable,” he said. According to Stockman, the CBOE and CME decisions to add bitcoin futures to their exchanges don’t give this emerging asset class legitimacy. “Anytime Wall Street sees an opportunity to shear the sheep, and they see the sheep stampeding to the slaughter, they line up with some new gimmick to take advantage of the circumstances. That’s all,” he said. “There is nothing that’s being validated by the opening up of a futures market. It’s just everybody trying to get on the train for the ride,” he added.

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Who needs the poor?

Britain’s Benefits System Has Become A Racket For Cheating Poor People (G.)

When Moira gets scared, she cuts herself. “It’s my way of taking control.” Right now she’s very scared. In a few days she faces a tribunal that will judge whether she is entitled to her disability benefit. She has been through forms and examinations and the officials who tell her one thing and those who tell her another, and she is nearly broken. In a low-ceilinged office at the back of a housing estate, she starts sobbing. “I cannot live like this any more.” Steph Pike lets Moira talk, before telling her, “stay focused”. After years as a welfare rights adviser, Pike knows what tribunals want: short, direct answers shorn of humiliation and pain. Now in her late 40s, Moira was raised in care, went to jail and has been repeatedly cheated of her benefits. Part of her life story is of being let down and punished by authority – but Pike needs her to set all that aside. “Bear with me,” Pike keeps saying. “This is important.”

Such meetings are normally confidential, but for three days over two weeks I had exclusive access to Pike in her work for the Child Poverty Action Group charity. I saw her advise others who appeared to have been wronged by state officials – and I accompanied Moira to that tribunal. That our benefits system is broken is no longer up for debate. Ministers are told universal credit is a fiasco and MPs weep over starving families in one of the richest societies in human history. Even rightwing tabloids run grim updates on how men with terminal cancer are declared fit to work just weeks before they die. Such cases are described as shameful. As failures. They are lined up like so many one-offs – not representative of fair-play Britain. But Pike and her colleagues know different. They see a system that routinely snatches money out of the hands of people who need and are entitled to it and bullies claimants with contempt.

Moira never went looking for welfare advice; she was just starving That’s Moira’s experience, too. Her trouble started when she found herself feeling steadily worse – and so did as she was told and rang the Department for Work and Pensions. Her recent back operation hadn’t worked, the arthritis in her spine, hips and knees was getting worse and the heavy-duty painkillers were wrecking her kidneys. She was summoned for a reassessment in Southend, a 70-mile round trip from her home in London – tricky for a woman who cannot walk more than 10 steps without crutches. Claimants such as Moira are entitled to a home assessment, but Pike told me they are often dispatched “miles away”. She was still told off for being late, says Moira. After the examination, she lost her personal independence payment.

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Selling to the west and east.

Russia Posts Highest-Ever Natural Gas Output in Expansion Drive (BBG)

Russia registered its highest-ever natural gas production last year amid plans to expand into China and boost sales of liquefied natural gas. The nation’s output of the fuel jumped 7.9% to 690.5 billion cubic meters, according to data emailed Tuesday by the Russian Energy Ministry’s CDU-TEK unit. That beat the previous record, set in 2011, by 2.9%. Russia, the world’s largest gas exporter, is working to boost output with plans to increase production of LNG with new plants in an area that stretches from the Baltic region to its Pacific coast. That will put the country up against the biggest producers of the super-chilled fuel, including Qatar, Australia and the U.S. Russia has resources to increase its LNG production almost 10 times by 2035, led by the privately-owned Novatek PJSC in the Arctic, according to the nation’s Energy Ministry.

The country is also working to keep shipments to Europe near record levels this year as state-run Gazprom PJSC, the continent’s biggest supplier, plans to start pipeline exports to China in late 2019. Gazprom meets more than a third of Europe’s demand for natural gas, Russia’s biggest and most lucrative market worth some $37 billion in revenue this year. The U.S. became the world’s largest natural gas producer in 2009, leapfrogging Russia thanks to its fracking revolution. It pumped 22.1 trillion cubic feet (about 626 billion cubic meters) of dry gas in first 10 months of 2017, according to December data from the U.S. Energy Information Administration. This was 11% higher than Russia for the same period.

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Create chaos.

US Is Running The Same Script With Iran That It Ran With Libya, Syria (CJ)

Two weeks ago a memo was leaked from inside the Trump administration showing how Secretary of State and DC neophyte Rex Tillerson was coached on how the US empire uses human rights as a pretense on which to attack and undermine noncompliant governments. Politico reports: The May 17 memo reads like a crash course for a businessman-turned-diplomat, and its conclusion offers a starkly realist vision: that the US should use human rights as a club against its adversaries, like Iran, China and North Korea, while giving a pass to repressive allies like the Philippines, Egypt and Saudi Arabia. ‘Allies should be treated differently -and better- than adversaries. Otherwise, we end up with more adversaries, and fewer allies,’ argued the memo, written by Tillerson’s influential policy aide, Brian Hook.

With what would be perfect comedic timing if it weren’t so frightening, Iran erupted in protests which have been ongoing for the last four days, and the western empire is suddenly expressing deep, bipartisan concern about the human rights of those protesters. So we all know what this song and dance is code for. Any evil can be justified in the name of “human rights.” In October we learned from a former Qatari prime minister that there was a massive push from the US and its allies to topple the Syrian government from the very beginning of the protests which began in that country in 2011 as part of the so-called Arab Spring. This revelation came in the same week The Intercept finally released NSA documents confirming that foreign governments were in direct control of the “rebels” who began attacking Syria following those 2011 protests.

The fretting over human rights has occurred throughout the entirety of the Syrian war, even as the governments publicly decrying human rights abuses were secretly arming and training terrorist factions to murder, rape and pillage their way across the country. We’ve seen it over and over again. In Libya, western interventionism was justified under the pretense of defending human rights when the goal was actually regime change. In Ukraine, empire loyalists played cheerleader for the protests in Kiev when the goal was actually regime change. And who could ever forget the poor oppressed people of Iraq who will surely greet the invaders as liberators?

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Conveyor belt.

More Than 170 Refugees Reach Lesbos, Samos Early New Year’s Day (K.)

More than 170 undocumented migrants reached the shores of Lesvos and Samos in the early hours of New Year’s Day, according to government figures. The first incident occurred at 12.30 a.m. when a plastic boat carrying 52 people reached the coastline of Mytilene, the main port of Lesvos. Another 83 migrants arrived at 1.30 a.m. on another boat that followed the same route from neighboring Turkey. Shortly after midnight, a vessel belonging to the European Union’s border monitoring agency Frontex intercepted another plastic boat east of Samos, with 38 people aboard. All the migrants were transferred to reception centers on the two islands.

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“..The family now live in Athens and are getting to know their new neighborhood until their asylum hearing – unfortunately set for 2019, despite Laila’s age…”

Syrian Grandmother Defies Perils To Cross Aegean At Age 110 (K.)

How far can a desire to see a loved one take us? Laila Saleh was so desperate to see the granddaughters she helped raise that she didn’t think twice about following the rest of her family out of northern Syria, despite being 110 years old. Her yearning to see Nisrin and Berivan, who had fled Kobani for Europe three years ago and now live in Germany after being granted asylum, bolstered her determination. “The journey was not easy, of course,” Laila’s grandson, Halil, told Kathimerini as he welcomed us into an apartment rented by Solidarity Now for asylum seekers in downtown Athens. The family, which is of Kurdish descent, traveled from Kobani to Izmir on the Turkish coast, and from there to the Greek island of Lesvos by inflatable boat. “Our grandmother can walk a little bit, but not long distances.”

Their group consisted of seven people, spanning four generations, and tried to ensure that as little as possible of the journey was on foot. When finding transport proved impossible, Halil and his father would carry Laila. “I carried the two children, one on my front and one on my back,” said his young wife, Saousan, as she played with twins Azar and Ari, Laila’s great-grandchildren. Despite the enormous challenges of the journey and a treacherous sea crossing – a first for Laila – the idea of leaving the elderly woman behind never crossed her children’s minds. “Our house had been bombed and we had to rent another one, but living conditions were bad,” said Halil. “Even though Grandmother is independent, she wouldn’t want to live anywhere without her children.”

The family had already suffered tremendous loss and there was little to keep them in war-ravaged Kobani. “In Syria, it is the duty of the youngest son to take care of his mother when she grows old,” said Laila’s son Ahmet, who has a heart problem and couldn’t carry his mother alone. He thankfully has his wife of 33 years, Ali, by his side, who helps care for the elderly woman. “I sleep very lightly at night because she often needs me,” said the 58-year-old woman. “She is very confused right now because of all the changes,” she added of her mother-in-law. Born in December 1907, Laila had a birthday this month, though the family does not know her exact date of birth. He longevity may make an impression on outsiders, but the family thinks it normal. “Our grandfather, Laila’s husband, died at the age of 115. That was in 1987, and Grandmother has lived with us since,” said Halil.

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“.. a 9000% increase in rhino killings since 2007 in South Africa alone..

” .. a rhino is slaughtered twice a day and an elephant is killed every 14 minutes…”

I’ve said it before, unless and until the penalty for killing big game is death (and even then!), we won’t solve this.

Drones Over Africa Target $70 Billion Illegal Poaching Industry (ZH)

In addition to the central bank-created bubble in financial markets, there is another bubble festering in the fields of Africa, called the “poaching boom.” Economic development in Vietnam, China, and the United States have fueled an illegal $70 billion industry of killing elephants and rhinoceroses for tusks. Poachers illegally hunt elephants and rhinos under the cover of darkness using surveillance equipment and high-tech weaponry.

The boom in poaching has contributed to a 9000% increase in rhino killings since 2007 in South Africa alone. Across Africa, a rhino is slaughtered twice a day and an elephant is killed every 14 minutes. According to Air Shepherd, a wildlife conservation group aimed at stopping poachers through a new AI drone system that targets poachers said, “at this rate elephants and rhinos will be extinct within 10 years.”

According to Air Shepherd, a wildlife conservation group aimed at stopping poachers through a new AI drone system that targets poachers said, “at this rate elephants and rhinos will be extinct within 10 years.” Air Shepherd has already conducted 6,000 flight hours over the skies of Africa testing the new AI drone system. Air Shepherd’s drones use high-tech airborne sensors, such as thermal infrared vision to detect heat coming from human or animal bodies. The mobile command center fits into the back of a van and uses AI systems developed by researchers from Carnegie Mellon, the University of Southern California, and Microsoft to detect potential poachers.

For now, the new AI drone surveillance system could greatly expand the area of coverage used to protect endangered wildlife by spotting poachers and alerting officials before the killing of an elephant and rhinoceros occurs. Which begs the question: are AI drones set to disrupt an illegal $70 billion industry in Africa? Perhaps, but not without a fight. Which is why we expect that the poaching industry will soon unveil a new set of aggressive countermeasures, which renderd the drone system powerless, which leads to the next question: are we about to observe the first drone-on-drone violence deep in the bowels of Africa?

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 November 11, 2016  Posted by at 11:00 am Finance Tagged with: , , , , , , ,  5 Responses »


Leonard Cohen 21 September 1934 – 7 November 2016

The End of Growth and the Rise of Trump (Tyee)
Donald Trump Is Moving To The White House, And Liberals Put Him There (Frank)
Rupee Note Cancellation Plunges India Into Panic (G.)
Emerging-Markets Rout Deepens as Europe Shares, Commodities Rise (BBG)
China Household Debt/GDP More Than Doubled In Under 10 Years To 40.7% (R.)
China’s Yuan Set for Steepest Weekly Loss Since January (BBG)
Judge Tells Trump University Litigants They Would Be Wise To Settle (R.)
The Unbearable Smugness Of The Press (CBS)
Obama Asks Congress For Extra $11 Billion, Wants More Lethal Drones (BBG)
BoE Chief Economist Andy Haldane: Economics Suffers From Tunnel Vision (BBG)
London Property Market Is “Tanking By The Day” (BBG)
Leonard Cohen Knew Things About Life, And If You Listened You Could Learn (G.)

 

 

Andrew Nikiforuk calls me an economist. Now we’ve heard it all… Still, good to see people are listening.

The End of Growth and the Rise of Trump (Tyee)

The economist Raúl Ilargi Meijer wrote an interesting essay explaining why there is a Donald Trump in September. He credited Trump’s rise to “the most important global development in decades.” That development, says Meijer, is “the end of global economic growth, which will lead inexorably to the end of centralization (including globalization). It will also mean the end of the existence of most, and especially the most powerful, international institutions.” “In the same way it will be the end of — almost — all traditional political parties, which have ruled their countries for decades and are already today at or near record low support levels (if you’re not clear on what’s going on, look there, look at Europe!),” he wrote.

“This is not a matter of what anyone, or any group of people, might want or prefer, it’s a matter of ‘forces’ that are beyond our control, that are bigger and more far-reaching than our mere opinions, even though they may be man-made.” The end of growth is tied inexorably to the deplorable quality of energy now being fracked and mined in North America. Bitumen and fracked oil just can’t support rich societies because these poor resources invite debt, environmental ruin and poor returns. Meijer adds “that the politico-econo-media machine churns out positive growth messages 24/7 goes some way towards explaining the lack of acknowledgement and self-reflection, but only some way. The rest is due to who we ourselves are. We think we deserve eternal growth.”

In the end, neither candidate talked about what mattered: growing climate anarchy; unrelenting economic stagnation; declining energy returns; and the onslaught of robots and algorithms in the workplace, government and home. Trump should remind us of two things and Camus, who understood the nature of tragedy, has expressed them well. The first is that “Nothing is more despicable than respect based on fear.” Trump embodies that sentiment. The second is the growing absurdity of it all. “Basically, at the very bottom of life, which seduces us all, there is only absurdity, and more absurdity. And maybe that’s what gives us our joy for living, because the only thing that can defeat absurdity is lucidity.”

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Not too impressed with Thomas Frank’s piece overall, but he gives a reasonable expose of what the Dems did wrong.

Donald Trump Is Moving To The White House, And Liberals Put Him There (Frank)

Start at the top. Why, oh why, did it have to be Hillary Clinton? Yes, she has an impressive resume; yes, she worked hard on the campaign trail. But she was exactly the wrong candidate for this angry, populist moment. An insider when the country was screaming for an outsider. A technocrat who offered fine-tuning when the country wanted to take a sledgehammer to the machine. She was the Democratic candidate because it was her turn and because a Clinton victory would have moved every Democrat in Washington up a notch. Whether or not she would win was always a secondary matter, something that was taken for granted. Had winning been the party’s number one concern, several more suitable candidates were ready to go.

There was Joe Biden, with his powerful plainspoken style, and there was Bernie Sanders, an inspiring and largely scandal-free figure. Each of them would probably have beaten Trump, but neither of them would really have served the interests of the party insiders. And so Democratic leaders made Hillary their candidate even though they knew about her closeness to the banks, her fondness for war, and her unique vulnerability on the trade issue – each of which Trump exploited to the fullest. They chose Hillary even though they knew about her private email server. They chose her even though some of those who studied the Clinton Foundation suspected it was a sketchy proposition. To try to put over such a nominee while screaming that the Republican is a rightwing monster is to court disbelief.

If Trump is a fascist, as liberals often said, Democrats should have put in their strongest player to stop him, not a party hack they’d chosen because it was her turn. Choosing her indicated either that Democrats didn’t mean what they said about Trump’s riskiness, that their opportunism took precedence over the country’s well-being, or maybe both. Clinton’s supporters among the media didn’t help much, either. It always struck me as strange that such an unpopular candidate enjoyed such robust and unanimous endorsements from the editorial and opinion pages of the nation’s papers, but it was the quality of the media’s enthusiasm that really harmed her. With the same arguments repeated over and over, two or three times a day, with nuance and contrary views all deleted, the act of opening the newspaper started to feel like tuning in to a Cold War propaganda station.

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From email I received yesterday: “People have been wiped out overnight. He had given a tax amnesty initially, declare your black money and pay a 30% tax. Later that increased to 50% and finally this. Huge wealth confiscation. Property prices expected to collapse. Dunno why such a shock move was implemented? The economy is doing well, low levels of debt overall, banks under state control and he was doing the right things. Income tax reform and a sales tax would’ve been much better to widen the tax base. India has major issues but when I went earlier this year to Delhi the development and progress is obvious. Infrastructure is pretty good, super airport, air quality is horrid, malls springing up everywhere and housing rental is very affordable but buying is ludicrously expensive. Economy was booming. Perfect black swan event. Only 3 people knew- The PM, FM and CB governor.”

Rupee Note Cancellation Plunges India Into Panic (G.)

Queues of angry, panicked Indians wound around bank buildings in Mumbai, the financial capital, on Thursday morning, two days after the prime minister, Narendra Modi, announced that 500- and 1,000-rupee notes, worth around £6 and £12, would be taken out of circulation. In a televised announcement on Tuesday night, Modi had urged Indians not to rush to banks, as they would have until the end of 2016 to deposit cash in their accounts. But with the high-value notes withdrawn from Wednesday in an effort to combat corruption, black-market trade and tax evasion, many were left without cash for day-to-day expenses. Banks were closed on Wednesday, and reopened on Thursday morning with a cap on cash withdrawals. ATMs remained closed, so currency was only available from the banks.

Newspapers around the country reported long queues at branches, as people scrambled to exchange their high-value banknotes for 100-rupee bills. At the Churchgate branch of the Bank of India, dozens of people queued in the midday heat, filling out deposit forms as a security guard barked instructions. “Life is completely paralysed,” said Maganbhai Solanki, who had been waiting in line for four hours. “On the news, they said banks would open at 8am today. I got here at 8.01,” he said. “Now, it’s noon, but I’m still here. Around 50 people in the queue ahead of me got tired of waiting and left but I have no choice. There’s no money in the house. We only have 500- and 1,000-rupee notes which are worth nothing. We didn’t even have enough to pay the milkman this morning.”

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The dollar comes home.

Emerging-Markets Rout Deepens as Europe Shares, Commodities Rise (BBG)

An emerging-markets selloff deepened amid concern developing economies will face capital outflows and weakening exports once Donald Trump is in The White House, while optimism surrounding his policies spurred gains in commodities and European shares rose. MSCI gauges of emerging-market equities and currencies sank to four-month lows since the election of Trump, who pledged to restrict imports and add fiscal stimulus that’s seen hastening interest-rate hikes by the Federal Reserve. More than $1 trillion was wiped off the value of bonds this week, something that’s happened only once before in the last two decades, as Treasuries lost the most since 2009. Shanghai shares entered a bull market, while industrial metals had their best week in more than 25 years.

Developing-nation assets have been roiled since Trump’s surprise win in Tuesday’s vote and central banks in India and Indonesia were said to have intervened Friday in support of their currencies. Futures indicate an 80% chance that the Fed will raise rates next month and expectations are building for more increases. Ten-year Treasury yields have climbed above 2% for the first time since January amid speculation the president-elect’s plans to cut taxes and boost spending will widen the U.S. budget deficit and stoke inflation. “There’s been a big rotation out of emerging markets into U.S. dollar assets,” said Jeffrey Halley, a market strategist at Oanda Asia Pacific Pte in Singapore. “An emerging market is a market you can’t emerge from in an emergency. It’s one of the best lessons I’ve ever learnt in 30 years in the market. When everybody runs for the door at the same time, the door’s very small.”

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Why repeat the west’s mistakes? What’s in it for Xi?

China Household Debt/GDP More Than Doubled In Under 10 Years To 40.7% (R.)

China’s household debt as a proportion of GDP has more than doubled to 40.7% in less than 10 years. While developed nations have higher rates of household debt, Chinese families are much more leveraged because income is lower and so proportionately the costs of social welfare from pensions to healthcare are much higher. At the end of 2014, the out-of-pocket health spend in China as a%age of total expenditure was 32%, compared to 9.7% in Britain and 11% in the United States, World Health Organization data shows. “Household debt leverage is very alarming, even though the aggregate amount is controllable,” said Wan Zhe, chief economist at China National Gold Group Corporation, visiting researcher at Chongyang Institute for Financial Studies, Renmin University of China.

“The first issue is that household debt has risen too quickly, the second is that it has risen too quickly as a proportion” of GDP and disposable income, said Wan. Underlining these concerns, authorities are trying to calm a property rally. In the latest move, regulators told banks to limit the issuance of home loans, the Shanghai Securities Journal reported on Thursday. The balance of retail mortgages at the end of the third quarter hit 16.8 trillion yuan ($2.5 trillion), more than a third higher than a year earlier, China central bank data shows. More broadly, consumer debt financed by Chinese banks has grown sharply, from 3.8 trillion yuan at the end of 2007 to 17.4 trillion yuan at the end of last year, a compound annual growth rate of 21%, Fitch Ratings said in a report.

But the growth in income has been much more modest, rising 6.3% in January to September compared with the year-earlier period, the weakest pace since 2013 when the National Bureau of Statistics first started issuing the data. “The rapid growth in outstanding (consumer) loan balances has been accompanied by an increase in NPLs (non-performing loans) across all segments of consumer debt,” the Fitch report said.

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It just keeps falling, that’s all it does anymore.

China’s Yuan Set for Steepest Weekly Loss Since January (BBG)

China’s currency is heading for its steepest weekly drop since January, when a series of weaker fixings roiled global financial markets, as Donald Trump’s election victory boosted the dollar and raised the threat of a more protectionist America. Bonds tumbled. The yuan fell 0.06% to 6.8134 at 10:07 a.m. in Shanghai, approaching the 6.83 level at which China pegged the currency after the 2008 global financial crisis. The exchange rate has fallen 0.9% this week to a six-year low as Trump’s unexpected win spurred a tectonic shift in fund flows, with emerging-market currencies tumbling with bonds while stocks rally. The 10-year yield on government debt climbed about 10 basis points this week, the most since May 2015.

Bloomberg’s dollar index held near an eight-month high amid speculation the Federal Reserve will boost interest rates to cap inflation as a Trump-led administration steps up spending. Trump has also threatened punitive tariffs on China’s imports. Accelerating declines in the yuan are a turnaround from the August-September period, when policy makers were suspected of propping up the currency before its entry into the IMF’s reserves basket. “A rally in the dollar has driven the yuan weaker, and the PBOC won’t likely defend the currency at this point because the costs of intervention could be very high under such an environment,” said Irene Cheung at Australia & New Zealand Bank in Singapore. “But if the depreciation accelerates in the coming weeks, there’s still a chance that China could take measures to stabilize the market.”

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Potentially messy if used for political purposes.

Judge Tells Trump University Litigants They Would Be Wise To Settle (R.)

The U.S. judge overseeing a lawsuit against President-elect Donald Trump and his Trump University told both sides they would be wise to settle the case “given all else that’s involved.” Lawyers for the president-elect are squaring off against students who claim they were they were lured by false promises to pay up to $35,000 to learn Trump’s real estate investing “secrets” from his “hand-picked” instructors. Earlier on Thursday, U.S. District Judge Gonzalo Curiel tentatively rejected a bid by Trump to keep a wide range of statements from the presidential campaign out of the fraud trial. Trump owned 92% of Trump University and had control over all major decisions, the students’ court papers say. The president-elect denies the allegations and has argued that he relied on others to manage the business.

Trial is scheduled to begin Nov. 28, and Curiel told lawyers he was not inclined to delay the six-year-old case further. Trump lawyer Daniel Petrocelli said he would ask to put the trial on hold until early next year, in light of the many tasks the magnate has before his inauguration. Curiel said he would allow both sides to file briefs on whether to delay the case. He also indicated they should consider making a deal. “It would be wise for the plaintiffs, for the defendants, to look closely at trying to resolve this case given all else that’s involved,” Curiel said. Petrocelli told reporters after the hearing that Trump might have to be a “little more flexible” about settling the case now that he is president-elect, although the lawyer wasn’t sure his client would was willing.

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ANother thing that just continues.

The Unbearable Smugness Of The Press (CBS)

The mood in the Washington press corps is bleak, and deservedly so. It shouldn’t come as a surprise to anyone that, with a few exceptions, we were all tacitly or explicitly #WithHer, which has led to a certain anguish in the face of Donald Trump’s victory. More than that and more importantly, we also missed the story, after having spent months mocking the people who had a better sense of what was going on. This is all symptomatic of modern journalism’s great moral and intellectual failing: its unbearable smugness. Had Hillary Clinton won, there’s be a winking “we did it” feeling in the press, a sense that we were brave and called Trump a liar and saved the republic. So much for that. The audience for our glib analysis and contempt for much of the electorate, it turned out, was rather limited.

This was particularly true when it came to voters, the ones who turned out by the millions to deliver not only a rebuke to the political system but also the people who cover it. Trump knew what he was doing when he invited his crowds to jeer and hiss the reporters covering him. They hate us, and have for some time. And can you blame them? Journalists love mocking Trump supporters. We insult their appearances. We dismiss them as racists and sexists. We emote on Twitter about how this or that comment or policy makes us feel one way or the other, and yet we reject their feelings as invalid. It’s a profound failure of empathy in the service of endless posturing. There’s been some sympathy from the press, sure: the dispatches from “heroin country” that read like reports from colonial administrators checking in on the natives.

But much of that starts from the assumption that Trump voters are backward, and that it’s our duty to catalogue and ultimately reverse that backwardness. What can we do to get these people to stop worshiping their false god and accept our gospel? We diagnose them as racists in the way Dark Age clerics confused medical problems with demonic possession. Journalists, at our worst, see ourselves as a priestly caste. We believe we not only have access to the indisputable facts, but also a greater truth, a system of beliefs divined from an advanced understanding of justice. You’d think that Trump’s victory – the one we all discounted too far in advance – would lead to a certain newfound humility in the political press. But of course that’s not how it works.

To us, speaking broadly, our diagnosis was still basically correct. The demons were just stronger than we realized. This is all a “whitelash,” you see. Trump voters are racist and sexist, so there must be more racists and sexists than we realized. Tuesday night’s outcome was not a logic-driven rejection of a deeply flawed candidate named Clinton; no, it was a primal scream against fairness, equality, and progress. Let the new tantrums commence!

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How about using the $11 billion to rebuild Syria?

Obama Asks Congress For Extra $11 Billion, Wants More Lethal Drones (BBG)

An $11.6 billion defense request that President Barack Obama sent Congress includes funds to buy more lethal drones for U.S. commandos fighting Islamic State and other terrorists as well as networks to counter the pilotless aircraft those groups are now using. The extra war-related funding requested Thursday for the current fiscal year would provide $5.8 billion for the Pentagon to continue operations in Iraq and Afghanistan. An equal amount for the State Department and the U.S. Agency for International Development would support counterterrorism efforts, refugee aid and improved embassy security, Obama said in a letter to lawmakers. While the amount requested for lethal drones is small, it provides a glimpse into a largely hidden phase of U.S. special operations in Iraq.

The White House requested $46.5 million to buy 535 Lethal Miniature Aerial Missile Systems and related equipment requested by the Special Operations Command Central due to “urgent operational needs.” The drone request is described as “for analytics, targeting, training, and equipment to support deployed U.S. Forces.” The only U.S. fighters in Iraq who are actively engaged in combat against Islamic State are in the highly classified Expeditionary Targeting Force set up a year ago to kill or capture militants. U.S. special operations forces also conduct raids in Afghanistan. The administration also requested, without elaboration, $150 million to develop and field within two years a network of “counter-small unmanned aerial systems at sites” in Iraq.

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A rare light in the profession.

BoE Chief Economist Andy Haldane: Economics Suffers From Tunnel Vision (BBG)

Bank of England Chief Economist Andy Haldane says economics suffers from tunnel vision and there’s a need to bring new ideas to the profession to make it relevant again. Haldane, whose speeches and papers have analyzed policy using everything from technology to biology, said his industry remains an “insular, self-referential discipline,” and this has to change. “One of the potential failings of the economics profession is that it may have borrowed too little from other disciplines – a methodological mono-culture,” he said in a speech on Thursday in Cambridge, England. An issue that dogs current economic models is forecasting performance, he said, noting the failure to predict the financial crisis and, since then, IMF world growth projections that “consistently over-estimated” the recovery.

It’s a timely point for BOE policy makers, who last week revised their projections for growth and inflation in the wake of Brexit. Haldane said economists need to improve their understanding of the world because rapid changes in economies have social and political implications. “It has been argued that these models were not designed to explain such extreme events” as the financial crisis, he said. “For me, this is not really a defense. If our models are silent about these events, this jeopardizes the very thing that makes economics interesting and economic policy important.” In his speech, he cited economist George Shackle’s description of the economy as a “kaleidoscope, a collision of colors subject to on-going, rapid and radical change.”

Haldane said agent-based models used in physics, chemistry and other sciences could enable a “fundamental changes in model dynamics.” Using it at the BOE has helped a better understanding of the housing market and the interaction of buyers, lenders and renters. Contrasting ABM models with traditional micro-founded economic ones, Haldane said the big picture usually looks very different from the small one. “Aggregating from the microscopic to the macroscopic is very unlikely to give sensible insights into real world behavior, for the same reason the behavior of a single neuron is uninformative about the threat of nuclear winter.”

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It will take a long time before people understand this is a positive thing.

London Property Market Is “Tanking By The Day” (BBG)

London’s real estate market, hurt by the Brexit vote, is “tanking by the day,” Green Property Chairman Stephen Vernon said. The firm, which has closed its London office, is waiting for an opportunity to buy into the market at lower values, the 66-year-old said at a conference in Dublin. Vernon would consider buying a real estate company, raising a fund or buying a portfolio of assets in London, he said. “It’s absolutely fantastic what’s going on,” said Vernon, who sold most of the firm’s properties in Ireland before values there crashed in 2008. A decision to re-enter the London market would be through a venture separate from Green Property and focus on commercial real estate, a spokesman for the investor said.

Office values in the City of London financial district fell the most in at least seven years in July after Britain voted to leave the European Union. Home prices in the U.K. capital fell for a fifth month in August, the worst streak since 2009, as higher taxes and the referendum result damped demand. The referendum result, higher levies on business premises and a rise in the stamp duty sales tax have led to a reduction in London commercial property values, Derwent London Plc Chief Executive Officer John Burns said in a statement on Thursday. “The central-London office market faces a number of challenges, including heightened global uncertainty, and business activity is likely to slow,” he said.

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I am the one who loves changing from nothing to one.

Leonard Cohen Knew Things About Life, And If You Listened You Could Learn (G.)

Leonard Cohen was always the grown-up in the room. He was young once, of course, but the world never saw much of the modestly successful poet and novelist from Montreal. He was already 33 — ancient by 60s standards — when he gazed out from the sepia-tinted, photo-booth snapshot on the cover of 1967’s Songs of Leonard Cohen with his shirt, tie and smart side-parting. The face suggested that he’d been around the block a few times; the voice and words confirmed it. The man knew things about life and if, you listened closely, you might learn something. The truth was that Cohen felt as lost as anybody. What gave his work its uncommon gravitas wasn’t that he knew the answers but that he never stopped looking.

He searched for clues in bedrooms and warzones, in Jewish temples and Buddhist retreats, in Europe, Africa, Israel and Cuba. He tried to flush them out with booze and drugs and seduce them with melodies. And whenever he managed to painfully extract some nugget of wisdom, he would cut and polish it like a precious stone before resuming the search. Funny about himself but profoundly serious about his art, he liked to describe his songs as “investigations” into the hidden mechanics of love, sex, war, religion and death – the beautiful and terrifying truths of existence. A Leonard Cohen song is an anchor flung into a churning sea. It has the kind of weight that could save your life. [..] When the chief executive of Columbia Records heard that A&R man John Hammond wanted to sign Cohen in 1967, he reportedly said: “A 32-year-old poet? Are you crazy?” But Hammond, who had launched Billie Holiday, Bob Dylan and Aretha Franklin, didn’t give up. During the first recording session for Songs of Leonard Cohen he shouted encouragement: “Watch out, Dylan!”

At the time, Bob Dylan was rock’n’roll’s preeminent poet. Cohen really was a poet but he wasn’t rock’n’roll. Steeped instead in literary discipline, French chanson and Jewish liturgy, his work suggested old-fashioned patience. To Dylan a song was a lump of wet clay to be moulded before it sets fast; to Cohen it was a slab of marble to be chipped into shape with immense dedication and care. Cohen never stopped being a poet or lost his reverence for words. You’ll find some erratic musical choices in his back catalogue but not a single careless line; nothing disposable. Years later, he said he had only one piece of advice for young songwriters: “If you stick with a song long enough it will yield. But long enough is beyond any reasonable duration.” When you sense that a songwriter has spent that long finding the right words, the least you can do is pay attention.

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Nov 202015
 
 November 20, 2015  Posted by at 10:28 am Finance Tagged with: , , , , , , , , , , ,  6 Responses »


Marjory Collins “Crowds at Pennsylvania Station, New York” Aug 1942

This Is What Will Kill The EU (Novak)
Goldman Eyes $20 Oil As Glut Overwhelms Storage Sites (AEP)
China Has a $1.2 Trillion Ponzi Finance Problem (Bloomberg)
A Hard Landing in China Could ‘Shake the World’ (Bloomberg)
The Real Reason Behind China’s Latest ‘Stimulus’ (CNBC)
China Cracks $64 Billion ‘Underground Bank’ Moving Money Abroad (Bloomberg)
China’s Yuan May Enter IMF Basket With Lower Share (Reuters)
Asian And Russian Buyers Desert Prime London Property Market (FT)
Here’s How the Boring German Housing Market Turned Piping Hot (Bloomberg)
Volkswagen Faces Pressure In US To Buy Back Older Diesel Cars (Reuters)
Volkswagen Faces Major Spending Cuts And Regulatory Deadlines (NY Times)
US Probes VW Supplier Bosch In Cheating Scandal (Reuters)
Caterpillar’s Depression Has Never Been Worse .. But It Has A Cunning Plan (ZH)
EU Targets Bitcoin, Anonymous Payments To Curb Terrorism Funding (Reuters)
Who Are The Traders Buying And Selling ISIS Oil? (Zero Hedge)
US Drone Operators: ‘Ever Step On Ants, Not Give It Another Thought?’ (Guardian)
Hottest October On Record Is Bad News For Polar Bears (MarketWatch)
US Clears GMO Salmon For Human Consumption (Reuters)
Merkel Confronts Refugee Policy Critics On Decade In Power (Bloomberg)
Toronto Couple Cancels Big Wedding To Help Sponsor Syrian Refugees (CBC)
Half of New Yorkers Say They Are Barely or Not Getting By (NY Times)
Of America’s Half Million Homeless, Nearly A Quarter Are Children (Reuters)

Excellent: “The truth is evil people who commit evil acts transcend economic trigger points, which is why you can get mugged by a poor person the same day that a billionaire banker cheats you out of your retirement savings and a rich terrorist tries to blow up an airliner with a bomb in his pants.”

This Is What Will Kill The EU (Novak)

It’s always the things you don’t expect that get you. After banking scandals, currency issues, and a Greek/Portugese/Spanish debt crisis just about every six months, the economic and political partnership that is the European Union seems much more likely to fall apart for an entirely different reason after all. That reason is ISIS. The direct cause is actually an extremely divisive and growing dispute about open borders, immigration, and refugee resettlement. But that conflict just became a lot more serious thanks to the horrific ISIS terrorist attacks in Paris Friday night. Now, this discussion has grown and migrated, (pun intended), from a political debate among E.U. elites to the #1 pressing issue on the streets of Europe.

When relatively smaller economic nations like Hungary began closing their borders to migrants and Syrian refugees last month, it could be written off as perhaps an isolated incident. But all bets are off now that France is closing its borders in response to the attacks, even if it is just temporarily. That’s because in so doing, President Francois Hollande has unambiguously connected the border issue with the effort to fight the spread of terror. It’s so obvious that even the most politically uninterested person can see what it means. And just in case the message still isn’t entirely clear to everyone, one of the major stories in Europe today is about how the alleged mastermind of the Paris attacks, Abdelhamid Abaaoud, boasted in videos about how easily he crisscrossed the borders of the E.U. for years.

This is a political nightmare for the statist bureaucrats who have been working for decades to reduce true representative democracy all for the goal of a unified and monolithic economic entity without worrying about being hindered by annoying little things like the will of the people. Before these attacks and the border response, the E.U. simply glossed over dissent and most attempts to challenge its un-elected sovereignty. Its best weapon in that fight has always been using the accusations of racism and xenophobia against those who refused to integrate and obey the E.U. fully and quickly enough in all matters of economics, immigration, and tax law. With a mostly compliant state-sponsored news media on its side, the “racist” and “xenophobic” label has been used the most against Britain’s anti-E.U. UKIP party more and more in recent years.

UKIP does keep gaining in popularity in the U.K., but it still has to fight very hard to beat back those scare tactic accusations. But what do the people who spread accusations of racism and xenophobia do now that more Europeans than ever believe their governments are sacrificing their safety in favor of remaining compliant with E.U. immigration dogma? The simple answer is that they’re in trouble, and no amount of sanctimonious shaming or economic threats will do much good when the majority of the public doesn’t feel safe anymore.

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No, Ambrose, OPEC’s pump and dump is not a strategy, it’s despair.

Goldman Eyes $20 Oil As Glut Overwhelms Storage Sites (AEP)

The world is running out of storage facilities for surging supplies of oil and may soon exhaust tanker space offshore, raising the chances of a violent plunge in crude prices over coming weeks, experts have warned. Goldman Sachs told clients that the increasing glut of oil on the global market has combined with mild weather from a freak El Nino this winter. The twin-effect could send prices plummeting to $20 a barrel, the so-called ‘cash cost’ that forces drillers to abandon production. “Risks of a sharp leg lower remain elevated,” it said. Oil has fallen from $110 a barrel early last year and is hovering near $40 for US crude, and $44 for Brent in Europe. The US investment bank said the overall glut in the commodity markets may take another twelve months to clear.

It cited ‘red flag’ signals on the Shanghai Future Exchange over recent days. Copper contracts point to “imminent weakening” in China’s ‘old economy’ of heavy industry and construction, it said. The warnings came as OPEC producers and Russian companies fight a cut-throat battle for market share in Europe and Asia. Saudi Arabia is shipping crude to Poland and Sweden for the first time, poaching new customers in the Kremlin’s traditional backyard. Iraq is selling its low grade ‘Basra heavy’ crude on global markets for as little as $30 a barrel as the country runs out of operating cash and is forced to cut funding for anti-ISIS militias. Iraq is seeking a large rescue loan from the IMF. “The drop in oil prices is a difficult test for us,” said premier Haider al-Abadi.

It is estimated that at least 100m barrels are now being stored on tankers offshore, waiting for better prices. A queue of 39 vessels carrying 28m barrels is laid up outside the Texas port of Galveston, while the Iranians have a further 30m barrels offshore ready to sell as soon as sanctions are lifted. “The world is floating in oil, and commercial stocks on land are at a record high,” said David Hufton, head of oil brokers PVM Group. “The numbers we are facing now are dreadful. Stocks have been building continuously for two years. This is unprecedented.” “What has saved us so far is that China has been buying 200,000 to 300,000 barrels a day (b/d) for their strategic reserve,” he said.

It is unclear exactly how much more space China may have. The Chinese authorities certainly want to keep building stocks – and do so at bargain prices – since reserves cover just 50 days demand, far short of the 90-day minimum recommended by the International Energy Agency. But the new storage depots in Gansu and Xinjiang will not be ready until the end of the year, at the earliest. Data from the US Energy Department shows that America’s storage sites are 70pc full, in theory leaving room for another 150m barrels. But this is already tight enough to create regional bottlenecks. It will not be sufficient if OPEC continues to flood the global market in a bid to drive out rivals. Excess supply is running near 2m b/d.

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I doubt that’s the total number. Try ten times that one.

China Has a $1.2 Trillion Ponzi Finance Problem (Bloomberg)

Chinese borrowers are taking on record amounts of debt to repay interest on their existing obligations, raising the risk of defaults and adding pressure on policy makers to keep financing costs low. The amount of loans, bonds and shadow finance arranged to cover interest payments will probably rise 5% this year to a record 7.6 trillion yuan ($1.2 trillion), according to Beijing-based Hua Chuang Securities. Dubbed “Ponzi finance” by Hyman Minsky, the use of borrowed funds to repay interest was seen by the late U.S. economist as an unsustainable form of credit growth that could precipitate financial crises. Chinese companies are struggling to generate the cash flow needed to service their obligations as economic growth slows to the weakest pace in 25 years and corporate profits shrink.

While the debt burden has been eased by six central bank interest-rate cuts in 12 months and a tumble in corporate borrowing costs to five-year lows, the number of defaults in China’s onshore corporate bond market has increased to six this year from just one in 2014. “Some Chinese firms have entered the Ponzi stage because return on investment has come down very fast,” said Shi Lei, the Beijing-based head of fixed-income research at Ping An Securities Co., a unit of the nation’s second biggest insurance company. “As a result, leverage will be rising and zombie companies increasing.” China Shanshui Cement became the latest company to default on yuan-denominated domestic notes last week as overcapacity in the industry hurt profits and a shareholder dispute stymied financing.

State-owned steelmaker Sinosteel, which pushed back an interest payment on a bond last month, postponed it again this week. Metrics of corporate health in Asia’s largest economy have deteriorated as growth slowed. The number of Shanghai and Shenzhen-listed companies that have less cash than short-term debt, net losses and contracting revenue has increased to 200 as of June from 115 in the year-earlier period, according to data compiled by Bloomberg. The amount of bad debt among Chinese banks rose 10% in the third quarter from the previous three months to 1.2 trillion yuan, about the size of New Zealand’s economy. Total debt at listed companies has climbed to 141% of common equity, based on a market-capitalization weighted average, the highest level in three years.

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It already is.

A Hard Landing in China Could ‘Shake the World’ (Bloomberg)

China’s slowdown is already playing out across the world, dragging down commodity prices and weighing on trade partners. And that’s while the economy is still growing at about 7%. So imagine what happens in a hard-landing scenario. The crew at Oxford Economics have done just that in a new report that makes stark reading for anyone with a stake in the global economy. China’s economic boom of the past 30 years means it now accounts for 11% of world GDP and around 10% of world trade. For resources, it’s an even bigger player, accounting for 11% of world oil demand and 40 to 70% of demand for other key commodities, according to the Oxford Economics research. Its financial system is massive, with its broad money supply now larger than the U.S.’s and amounting to over 20% of the world’s.

So were China to sneeze, the world may well catch a cold. First to trade. The volume of goods imported into China have already fallen by around 4% in the first three quarters of the year, after rising an average 11% per year from 2004-14. That means China has cut around 0.4 percentage point from world goods trade growth in the nine months to the end of September, after having added an average 1 percentage point a year in the previous decade. The biggest losers are those with the closest trade links and those whose economies are most open. For most advanced economies, their reliance on trade with China is lower, with Germany among the more dependent.

Then there’s the indirect effects as the drag on GDP of China’s trading partners works through the global economy. For instance, Japan would not only suffer from weaker exports to China but also to Korea and other Asian trading partners affected by China’s slowdown, the Oxford Economics research shows. Another transmission is via commodity prices, with any further slowdown in Chinese growth leading to additional price falls, especially as supply has expanded significantly in recent years. That would be bad news for the likes of Australia and Brazil. And here’s another spillover you may not have thought of: One consequence of the plunge in crude prices is that oil exporting countries and their sovereign wealth funds now have less money to invest in advanced economy financial assets.

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Making shadow banks look less attractive..

The Real Reason Behind China’s Latest ‘Stimulus’ (CNBC)

A decision by the People’s Bank of China (PBoC) to lower short-term borrowing costs for banks is not the standard pick-me-up aimed at a weakening economy. Instead, the latest step by the PBoC is an experiment towards finding alternatives to benchmark interest rates whose efficacy has been blunted in recent years by the surge in the shadow banking system as well as removal of limits that tied commercial bank rates to official policy rates, economists say. Late on Thursday, the central bank reduced its Standing Lending Facility (SLF) interest rates, yet another policy tool to inject cash into banks, with the seven-day rate cut to 3.25% and the overnight rate to 2.75% from 5.5% and 4.5%, respectively.

Typically, Chinese monetary stimulus relies on interest rate cuts or reductions in bank reserve requirements, with the lesser-known SLF only being used in anticipation of periods of tight liquidity, such as holidays. The facility hasn’t been used since March. Thursday’s departure from traditional policy tools suggests that the central bank wasn’t necessarily trying to boost economic growth, unlike previous easing episodes. Thursday’s cuts were to “discover the function of the Standard Lending Facility as the ceiling of the interest rate corridor,” according to the PBoC’s statement. Global central banks use the interest corridor system to guide market interest rates towards main policy rates.

When monetary conditions are tight, short-term money market rates move towards the upper end of the corridor as commercial lenders borrow from the central bank. Conversely, when financial markets are awash with cash, the lower end of the corridor ends up guiding policy.

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Watch out housing bubbles.

China Cracks $64 Billion ‘Underground Bank’ Moving Money Abroad (Bloomberg)

China said it cracked the nation’s biggest “underground bank,” which handled 410 billion yuan ($64 billion) of illegal foreign-exchange transactions, as the authorities try to combat corruption and rein in capital outflows that have hit records this year. More than 370 people have been arrested or face lawsuits or other punishment in the case centered in eastern Zhejiang province, the official People’s Daily reported on Friday, citing police officials. The case brought the total for underground banking and money-laundering activities to 800 billion yuan since April, the newspaper said. The probe began in September last year and the police took almost a year to sort through more than 1.3 million suspicious transactions, the state-run Xinhua News Agency reported separately. The authorities froze more than 3,000 bank accounts, Xinhua said.

The case highlights the nation’s struggle to control capital outflows that have helped to send real-estate prices soaring from Vancouver to Sydney – even when Chinese citizens are officially limited to converting $50,000 of yuan per year. Some people may be moving the proceeds of corruption, while others may be concerned about the outlook for the economy and the potential for the yuan to weaken. “The government wants to stem outflows and stabilize the yuan’s exchange rate, but the outflows cannot be stopped unless people change their expectation on yuan depreciation,” said Xi Junyang, a finance professor at Shanghai University of Finance & Economics. Besides illegal banking operations, “a lot of money is leaving the country by legal means,” Xi said.

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Xi will probabbly be elated. The yuan goes down because the IMF wants it. Beggar thy neigbor by decree.

China’s Yuan May Enter IMF Basket With Lower Share (Reuters)

China’s yuan may enter the IMF’s benchmark currency basket at a lower weighting than previously estimated because of changes in how to calculate the make-up of the basket, people briefed on the Fund’s discussions told Reuters. IMF policymakers are expected to add the Chinese currency to the Special Drawing Rights basket later this month, after a campaign by Beijing for the yuan, or renminbi, to have equal billing with the dollar, euro, pound sterling and yen. Two people familiar with IMF deliberations said policymakers were considering changing the way the weights of currencies in the basket are calculated to make export volumes less important and financial flows more important.

China, the world’s largest exporter, lags other countries in financial transactions and such a change would give China’s yuan, also known as the renminbi, a lower share in the basket than under the current formula. The yuan’s inclusion is largely seen as a recognition of China’s political and economic heft and as setting the seal of approval on its economic reforms and would likely not have a major impact on financial markets. IMF staff calculated in July the yuan could have a weighting of about 14 to 16% and HSBC estimated it would have about 14% under the current formula. “I would say that it’s too high,” one person briefed on the IMF discussions said, referring to the estimates.

A second person, an official of a major Asian country who saw the IMF staff report, said: “It’s barely a two-digit rate, just the minimum (rate to be a double-digit one).” The SDR basket determines the mix of currencies that countries like Greece can receive as IMF disbursements and economists expect that inclusion will boost demand for the yuan. A lower weighting may crimp demand slightly. Last set in 2010, the basket is currently 41.9% dollar, 37.4% euro, 11.3% sterling and 9.4% yen. Capital Economics economist Andrew Kenningham said the methodology change would impact the yuan the most, while the other countries would maintain similar ratios. “The renminbi is completely different because despite its inclusion in the SDR, it’s not really a fully convertible currency and has very thin, much less liquid markets,” he said.

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The Chinese will soon follow, Beijing’s launching crackdowns.

Asian And Russian Buyers Desert Prime London Property Market (FT)

Asian and Russian homebuyers who once made up a third of those buying property in London’s wealthiest areas have largely deserted the market this year as emerging market currencies plunged against sterling. Properties in leafy boroughs such as Kensington, where the average home price is £1.5m, have been a sought-after asset in recent years among wealthy buyers seeking a base or an investment in a global, politically stable city. But that has changed in 2015, in a shift that estate agents said was partly down to turmoil in emerging markets and partly to a change in stamp duty that means buyers of the priciest homes pay substantially more tax. Asian homebuyers made up 26% of those buying homes in areas such as Kensington, Chelsea and Belgravia in the first three-quarters of last year, but that number was down to 6% in the same period of 2015, according to figures compiled by Hamptons, a high-end estate agent.

Chinese buyers were down from 9% of the total to 3%. Russians made up just 1% of buyers in the prime London areas, which also include Knightsbridge and Mayfair, in the first three-quarters of 2015, down from 7% a year earlier. The fall has coincided with a period of turbulence in Chinese equity markets, which spread to other Asian emerging markets and prompted falls in the region’s currencies against sterling. China’s renminbi is down 6.6% since April. In Russia, the war in Ukraine and international sanctions, together with lower oil prices, have taken a big toll on the country’s economy and currency. The rouble has shed 25% against sterling since April and is down 53% over the past two years. [..] Total transactions in prime London boroughs were down 19 per cent in the first three-quarters of 2015 against a year earlier, according to figures from LonRes, with agents blaming the stamp duty rise.

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Germany catches the Anglo-Saxon housing disease.

Here’s How the Boring German Housing Market Turned Piping Hot (Bloomberg)

Germany’s housing market is hot. Rents are rising in big cities including Berlin and Hamburg as young people seeking work move there from rural areas and elsewhere in Europe. Construction, however, has been slow to catch up, which has led to housing shortages and made leasing apartments a bonanza for landlords. Low interest rates make it cheaper than ever for companies to buy apartments, fueling record acquisitions by landlords including the country’s biggest, Vonovia. Portfolio sales rose from €5 billion in 2011 to €18.4 billion in the first nine months of this year, according to data compiled by Savills.

While shopping-mall owners and office developers dominate the listed-property sector in other countries, Germany’s residential property market is lucrative for landlords because it’s a nation of renters – and Germans tend to pay their rent on time. The surge in mergers and acquisitions, coupled with rising stocks, have allowed the market value of Germany’s publicly traded landlords to grow tenfold since 2012. The top two – Vonovia and Deutsche Wohnen – are now among the world’s biggest owners of homes, surpassing peers in the U.S. What’s more, Vonovia wants to buy its rival to create Europe’s No. 2 property company. With about 1 million refugees expected to enter Germany this year, the most of any European country, demand for apartments is unlikely to shrink anytime soon.

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At what prices?

Volkswagen Faces Pressure In US To Buy Back Older Diesel Cars (Reuters)

Volkswagen, which is set to provide detailed plans to fix vehicles that do not comply with U.S. emissions standards, faced more pressure on Thursday from officials in Washington and California to buy back older diesel cars. A California Air Resources Board spokesman said officials at the automaker are scheduled to meet Friday with CARB and the U.S. Environmental Protection Agency to present detailed proposals for recalling and fixing about 482,000 vehicles sold in the United States with diesel engines that emit more smog-forming pollutants than allowed by law. California has set a Nov. 20 deadline for Volkswagen to come up with a plan to fix the diesel cars affected by its rigging of emissions tests.

The carmaker said in September that around 11 million diesel powered cars were affected worldwide, including 482,000 in the United States. “I am personally hopeful we will be able to announce something soon about the remedies … and which we are discussing with the agencies in upcoming days,” Michael Horn, head of Volkswagen’s U.S. operations, said at the Los Angeles Auto Show on Wednesday. The CARB spokesman also confirmed that the agency’s head, Mary Nichols, told the German daily Handelsblatt that Volkswagen might have to buy back some of the older diesel models. “I think it is quite likely that they will end up buying back at least some portion of the fleet from the current owners,” the paper quoted Nichols as saying in an interview to be published on Friday.

Newer cars might get easy software fixes and medium generation ones might need software and hardware components to fix the issue, Nichols said, according to the paper. But older cars might have to be repurchased rather than fitted with new pollution control devices. Separately, U.S. Senators Ed Markey of Massachusetts and Richard Blumenthal of Connecticut on Thursday released a letter calling on the automaker to buy back diesel vehicles that don’t meet pollution standards. The lawmakers noted that Volkswagen had signaled it could buy back cars sold in Europe that have inaccurate carbon dioxide emissions ratings.

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The California Air Resources Board is our best hope.

Volkswagen Faces Major Spending Cuts And Regulatory Deadlines (NY Times)

Volkswagen is expected to announce substantial spending cuts on Friday as the carmaker braces for the financial impact of its emissions-cheating crisis — potentially setting up a confrontation with its powerful labor representatives. Volkswagen also faces a Friday deadline to inform regulators in the United States of how it plans to bring its diesel cars there into compliance with air-quality standards. The company admitted in September that it had installed software in the cars that was meant to enable the vehicles to cheat on emissions tests. That scandal, which involves about 11 million vehicles worldwide — most of them in Europe — is a big reason Volkswagen is now forced to cut costs.

The company must pay to modify the cars and could face billions of dollars in fines and legal settlements. Senior officials from the United States Environmental Protection Agency and the California Air Resources Board plan to meet with representatives from Volkswagen and its Audi division on Thursday and Friday to review the company’s proposed solutions, according to a spokeswoman for the E.P.A. Volkswagen is also under pressure to demonstrate to United States authorities that it is serious about identifying the people responsible for installing the software. Of the vehicles affected worldwide, about 500,000 are in the United States.

In addition, Volkswagen has admitted making exaggerated claims about the carbon dioxide output and fuel economy for 800,000 more cars in Europe. The Friday deadline was set by the California Air Resources Board, which helped to expose Volkswagen’s use of the so-called defeat software in its diesel vehicles. CARB, as it is known, is a particularly influential regulator in part because of the size of the California car market and also because it sets some of the most stringent emissions standards in the United States.

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“A garage mechanic who soups up a car so a bank robber can make his getaway is participating in the crime.”

US Probes VW Supplier Bosch In Cheating Scandal (Reuters)

U.S. authorities are investigating German auto supplier Robert Bosch over its role in Volkswagen’s massive scheme to cheat U.S. emission standards, according to people familiar with the matter. Federal prosecutors with the U.S. Department of Justice are examining whether Bosch, the world’s largest auto supplier, knew or participated in Volkswagen’s years-long efforts to circumvent U.S. diesel emissions tests, the people said. Bosch built key components in the diesel engine used in six Volkswagen models and one Audi model that the automaker has admitted to rigging to defeat emissions tests. Federal authorities are also investigating how deeply the scheme permeated VW’s hierarchy, according to people familiar with the matter.

The probe is at an early stage and there is no indication that U.S. prosecutors have found evidence of wrongdoing at Bosch, the people added, asking not to be named because the matter is not public. Volkswagen has admitted to installing software that allowed its 2.0 liter diesel models to pass U.S. clean air tests, while shutting off emissions control systems when its diesel cars are actually on the road. VW said in September that around 11 million diesel powered cars were affected worldwide, including 482,000 in the United States. Bosch provides the engine control module, called EDC17, and basic software for nearly all the four-cylinder diesel cars sold in North America, including by Volkswagen, BMW and Daimler’s Mercedes-Benz.

Those systems regulate how a vehicle cleans burned-up fuel before it is expelled as exhaust. Volkswagen had the engine software modified to turn on the vehicle’s emission control system when it was being tested in the lab, then turn it off when the vehicle was on the road, according to U.S. regulators. For authorities to bring charges against Bosch, they would have to prove the supplier knew that their technology was being used by Volkswagen to evade emissions requirements, said Daniel Riesel, an environmental attorney at Sive, Paget & Riesel P.C. “If you know that a crime is being committed and you actively facilitate part of the crime you are on the hook,” Riesel said. “A garage mechanic who soups up a car so a bank robber can make his getaway is participating in the crime.”

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Having fun on the way down. Way down.

Caterpillar’s Depression Has Never Been Worse .. But It Has A Cunning Plan (ZH)

Moments ago Caterpillar reported its latest monthly retail sales statistics and the numbers have never been worse: not only is the dead CAT bounce in US sales finally over, tumbling -8% Y/Y, after a -4% decline in September and hugging the flatline for the past few months, but sales elsewhere around the globe were a complete debacle: Asia/Pacific (mostly China) was down -28%, a dramatic drop from the -17% a month ago, EAME dropping -13%, and Latin America down -36%…

… but global retail sales just posted a massive -16% drop in the past month, after dropping 9% a year ago and another 12% in 2013, this was the biggest annual drop since early 2010. As the chart below shows, CAT has now suffered a record 35 months, or nearly 3 years, of consecutive declining annual retail sales – something unprecedented in company history, and set to surpass the “only” 19 months of decling during the great financial crisis by a factor of two!

Worse, with the market no longer rewarding stock buybacks, Caterpillar suddenly finds itself flailing in the gale strength winds of what nobody can claims any longer is not a global industrial depression. However, there is good news – while Caterpillar’s revenues and cash flows may be plummeting with every passing month, at least the company has a cunning plan how to recover some inventory. According to the WSJ, Caterpillar is eager to reassure shareholders it won’t get burned on equipment leased to customers in China even as the economy cools there. CAT Financial Services President Kent Adams said during a conference call on Tuesday that the company keeps tabs on the position of machinery electronically through its Product Link system.

“If a customer falls behind, we have the ability to derate the engine or turn the engine off, and we’ve set up a legal presence in all of the provinces of China.” In other words, any and all Chinese lessors who fall behind on their payments will suddenly find their excavator’s engine shut down and no longer operable, stuck in the middle of a mine, quarry, or construction site with a paperweight weighing dozens of tons.

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Sliding scales. There’s no proof Bitcoin is used this way.

EU Targets Bitcoin, Anonymous Payments To Curb Terrorism Funding (Reuters)

EU countries plan a crackdown on virtual currencies and anonymous payments made online and via pre-paid cards in a bid to tackle terrorism financing after the Paris attacks. EU interior and justice ministers will gather in Brussels on Friday for a crisis meeting called after the Paris carnage of last weekend. They will urge the European Commission to propose measures to “strengthen controls of non-banking payment methods such as electronic/anonymous payments and virtual currencies and transfers of gold, precious metals, by pre-paid cards,” draft conclusions of the meeting said. Bitcoin is the most common virtual currency and is used as a vehicle for moving money around the world quickly and anonymously via the web without the need for third-party verification. Electronic anonymous payments can be made also with pre-paid debit cards purchased in stores as gift cards. EU ministers also plan “to curb more effectively the illicit trade in cultural goods,” the draft document said.

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No reason to doubt ‘we’ know who they are.

Who Are The Traders Buying And Selling ISIS Oil? (Zero Hedge)

[..] what we have been wondering for months and what we hope some enterprising journalist will soon answer, is just who are the commodity trading firms that have been so generously buying millions of smuggled oil barrels procured by the Islamic State at massive discounts to market, and then reselling them to other interested parties. In other words, who are the middlemen. What we do know is who they may be: they are the same names that were quite prominent in the market in September when Glencore had its first, and certainly not last, near death experience: the Glencores, the Vitols, the Trafiguras, the Nobels, the Mercurias of the world.

To be sure, funding terrorist states is not something that some of the most prominent names in the list above have shied away from in the past. Which one (or ones) are the guilty parties – those who have openly breached terrorism funding laws – we don’t know: it may be one, or more of the above, or someone totally different. At this point, however, three things are certain: whoever the commodity trading house may be that is paying ISIS-affiliated “innocent civilians” hundreds of millions of dollars for their products, they are perfect aware just who the source of this deeply discounted crude is. Crude so deeply discounted, in fact, it results in massive profits for the enterprising middleman who are engaging in openly criminal transactions.

The second certainty: whoever said middleman is, it is very well known to US intelligence services such as the NSA and CIA, and thus to the Pentagon, and thus, the US government. The third certainty is that while the US, and Russia, and now France, are all very theatrically bombing something in the Syrian desert (nobody really knows what), the funding of ISIS continues unabated as someone keeps buying ISIS oil. We wonder how long until someone finally asks the all important question regarding the Islamic State: who is the commodity trader breaching every known law of funding terrorism when buying ISIS crude, almost certainly with the tacit approval by various “western alliance” governments, and why is it that these governments have allowed said middleman to continue funding ISIS for as long as it has?

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Sickening. Shooting little children video game style.

US Drone Operators: ‘Ever Step On Ants, Not Give It Another Thought?’ (Guardian)

When Michael Haas, a former senior airman with the US air force, looks back on the missions he flew over Afghanistan and other conflict zones in a six-year career operating military drones, one of the things he remembers most vividly is the colorful language airmen would use to describe their targets. A team of three would be sitting, he recalls, in a ground control station in Creech air force base outside Las Vegas, staring at computer screens on to which images would be beamed back from high-powered sensors on Predator drones thousands of miles away. The aim of the missions was to track, and when the conditions were deemed right, kill suspected insurgents. That’s not how they put it, though. They would talk about “cutting the grass before it grows out of control”, or “pulling the weeds before they overrun the lawn”.

And then there were the children. The airmen would be flying the Predators over a village in the tribal areas of Pakistan, say, when a series of smaller black shadows would appear across their screens – telling them that kids were at the scene. They called them “fun-sized terrorists”. Haas is one of four former air force drone operators and technicians who as a group have come forward to the Guardian to register their opposition to the ongoing reliance on the technology as the US military’s modern weaponry of choice. Between them, the four men clocked up more than 20 years of direct experience at the coalface of lethal drone programs and were credited with having assisted in the targeted killings of hundreds of people in conflict zones – many of them almost certainly civilians.

As a senior airman in the 15th reconnaissance squadron and 3rd special operations squadron from 2005 to 2011 – a period straddling the presidencies of George W Bush and Barack Obama – Haas participated in targeted killing runs from his computer in Creech that terminated the lives of insurgents in Afghanistan almost 8,000 miles away. He was a sensor operator, controlling the cameras, lasers and other information-gathering equipment on Predator and Reaper drones as well as being responsible for guiding Hellfire missiles to their targets once the pilot sitting next to him had pulled the trigger. Haas looks too youthful to be burdened by such enormous issues. Yet the existential sensation of killing someone by manipulating a computer joystick has left a deep and lasting impression on him.

“Ever step on ants and never give it another thought? That’s what you are made to think of the targets – as just black blobs on a screen. You start to do these psychological gymnastics to make it easier to do what you have to do – they deserved it, they chose their side. You had to kill part of your conscience to keep doing your job every day – and ignore those voices telling you this wasn’t right.”

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Lowball 101: “There are currently an estimated 22,000 to 31,000 polar bears globally, but that number could shrink by as much as 30% by 2050..”

Hottest October On Record Is Bad News For Polar Bears (MarketWatch)

If the month of October felt unusually hot, that’s because it was. The average temperature over land and ocean surfaces was the highest since records began in 1880, according to the National Oceanic and Atmospheric Administration. As the chart below illustrates, Africa and Australia had their hottest Octobers since records began, while must of the rest of the world baked in higher-than-average temperatures, said the NOAA in its October Global Analysis report. Among the report’s other findings, U.S. had its warmest October since 1963, and fourth-warmest since record keeping began in 1895. In South America, northern and central areas had warmer-than-average conditions, while southern areas had much cooler-than-average temperatures.

Parts of Argentina set new monthly record low temperatures. In Europe, Denmark had its driest October since 1972, while Latvia had its driest October on record. At the same time, Eastern Europe and areas of western Russia had cooler-than-average temperatures. Much of Africa was hotter-than-average in the month, yielding the highest October for the continent on record. Australia had its warmest October since record keeping started in 1910, while the departure from the average was also the highest for any month on record. Meanwhile, Arctic sea ice extent was 13.4% below the 1981 to 2010 average, marking the sixth smallest October since satellite records first began in 1979. Extent is the area measured in square miles that has at least some ice on it.

That’s bad news for polar bears, which on Thursday were added to a list of endangered species by a conservation watchdog. Polar bears are highly vulnerable to climate change as it is rapidly eroding their sea ice habitat, according to the International Union for Conservation of Nature (IUCN). There are currently an estimated 22,000 to 31,000 polar bears globally, but that number could shrink by as much as 30% by 2050, if they continue to lose the floating ice that allows them to hunt seals, said the IUCN.

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Mary Shelley’s laughing.

US Clears GMO Salmon For Human Consumption (Reuters)

U.S. health regulators on Thursday cleared the way for a type of genetically engineered Atlantic salmon to be farmed for human consumption – the first such approval for an animal whose DNA has been scientifically modified. Five years ago, the U.S. Food and Drug Administration first declared the product, made by Massachusetts-based AquaBounty Technologies, to be as safe as conventional farm-raised Atlantic salmon. AquaBounty’s product will not require special labeling because it is nutritionally equivalent to conventional farm-raised Atlantic salmon, the FDA said on Thursday.AquaBounty developed the salmon by altering its genes so that it would grow faster than farmed salmon, and expects it will take about two more years to reach consumers’ plates as it works out distribution.

AquaBounty is majority owned by Intrexon Corp, whose shares were up 7.3% at $37.55 in afternoon trading. AquaBounty says its salmon can grow to market size in half the time of conventional salmon, saving time and resources. The fish is essentially Atlantic salmon with a Pacific salmon gene for faster growth and a gene from the eel-like ocean pout that promotes year-round growth. Activist groups have expressed concerns that genetically modified foods may pose risks to the environment or public health. Several on Thursday said they would oppose the sale of engineered salmon to the public, while some retailers said they would not carry the fish on store shelves.

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She’s fine for now, but what if there’s attacks in Germany?

Merkel Confronts Refugee Policy Critics On Decade In Power (Bloomberg)

Angela Merkel heads to Bavaria on Friday for an appointment with some of the most persistent domestic critics of her refugee policy, in a test of her staying power just before her 10th anniversary in office. As terrorism fears add to Europe’s refugee crisis, the German chancellor’s address to the Christian Social Union will seek to preserve domestic harmony as she pursues international diplomacy to secure the region’s outer border. While Merkel is likely to reaffirm her goal of limiting the influx to Germany, she won’t offer the cap on migration that some in the CSU want, according to a person familiar with her thinking. It’s part of the balancing act as Merkel stakes her political future on persuading Germans they can cope with the biggest influx of migrants and refugees since World War II, putting at risk the standing she’s built up since taking the oath of office a decade ago Sunday.

“There is a lot of grumbling” within Merkel’s faction about her handling of the crisis as she pursues her humanitarian convictions, said Jan Kallmorgen, a partner at political consultancy Interel in Berlin. Her position is strengthened, though, because she’s “overwhelmingly respected” abroad and “the only one who has the international standing to work with other leaders” beyond the European Union, he said. With at least 800,000 asylum seekers expected in Germany this year, Merkel’s stance that the country is morally and legally obliged to accept them has spurred resistance in Bavaria, the main entry point. Merkel mollified Bavarian premier and CSU head Horst Seehofer with an agreement this month to restrict economic migrants from regions including the Balkans. [..]

As towns and cities struggle to shelter and feed refugees and winter approaches, support for Merkel’s CDU-CSU bloc has declined in polls while Alternative for Germany, or AfD, which advocates immigration limits, has gained. The CDU stumbled to 37.5% from 42% in September, while the AfD has doubled its support to 7%, according to an Allensbach poll for Frankfurter Allgemeine Zeitung newspaper. The Social Democrats, Merkel’s junior coalition partner, was unchanged at 26% in the Nov. 1-12 poll. Merkel’s poll numbers remain well above the lows reached at the height of the euro area’s debt crisis, giving her the clout to stand firm toward her Bavarian regional ally.

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Cool people.

Toronto Couple Cancels Big Wedding To Help Sponsor Syrian Refugees (CBC)

A Toronto couple has cancelled their plans for a big, expensive wedding and is instead putting the money toward sponsoring a family of Syrian refugees. Samantha Jackson and Farzin Yousefian were planning to have a traditional wedding with all the trimmings in March that would have cost tens of thousands of dollars. They had already booked a venue, hired caterers and invited their family and friends. But in September, they saw the pictures of three-year-old Syrian refugee Alan Kurdi’s lifeless body washed up on a Turkish beach. The couple cancelled their plans and instead put the wedding funds towards sponsoring a Syrian refugee family of four.

“We thought this really has to be an opportunity for us to really use our wedding as a platform, as a way to make a difference alongside our friends and family in what has obviously become an absolutely outstanding humanitarian crisis,” Jackson told CBC News. Jackson is a PhD student at Ryerson University, where she studies refugee health care policy and volunteers with the Ryerson University Lifeline Syria Challenge, which raises funds to sponsor refugees in Toronto. While planning their wedding, she and Yousefian would often talk about the global refugee crisis and wonder if there was anything they could do to help. “When there’s such a dire situation, it’s easy to become overwhelmed about thinking of ways to contribute,” Yousefian said.

“We just thought, wait a second, there’s a better way to do this. Given the circumstances, we need to turn the focus on the crisis and raise awareness and funds.” The couple tied the knot last month in a small ceremony at city hall. In lieu of wedding presents, friends and family donated to the cause. “I think the best part about this whole process has been seeing people’s reactions and then seeing just how thrilled they are for the idea and how excited they are about finding a way to contribute as well and to help us contribute,” Yousefian said. “We owe it all to our friends and family. Without them, this really couldn’t have happened a short time frame.”

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All these bubble cities suffer the same thing.

Half of New Yorkers Say They Are Barely or Not Getting By (NY Times)

Half of New York City residents say they are struggling economically, making ends meet just barely, if at all, and most feel sharp uncertainty about the future of the city’s next generation, a new poll shows. The poll, conducted by The New York Times and Siena College, shows great disparities in quality of life among the city’s five boroughs. The stresses weighing on New Yorkers vary widely, from the Bronx, where residents feel acute concern about access to jobs and educational opportunity, to Staten Island, where one in five report recently experiencing vandalism or theft. But an atmosphere of economic anxiety pervades all areas of the city: 51% of New Yorkers said they were either just getting by or finding it difficult to do so.

Even in Manhattan, three in 10 said they were just getting by. (58% said they were doing all right or thriving financially — the highest response of the five boroughs.) In some respects, the poll echoed the “tale of two cities” theme of Mayor Bill de Blasio’s 2013 campaign: Residents of the Bronx and Brooklyn shared the most pronounced sense of economic insecurity, and the lowest confidence in local government and the police — a distinctly different experience from the rest of the city. In those boroughs, nearly three in five residents said they were straining to make ends meet. In the Bronx, 36% said there had been times in the past year when they did not have the money to buy enough food for their family; only one in five said they and their neighbors had good or excellent access to suitable jobs.

But if the city appears divided into broad camps of haves and have-nots, it was, perhaps surprisingly, the less privileged segments of New York that shared the most positive outlook on the future. Four in 10 Brooklyn residents said their neighborhood was getting better, and 36% of Bronx residents said the same. Manhattanites and Staten Islanders were most likely to say things were getting worse in their area.

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The land of the …?!

Of America’s Half Million Homeless, Nearly A Quarter Are Children (Reuters)

More than 500,000 people – a quarter of them children – were homeless in the United States this year amid scarce affordable housing across much of the nation, according to a study released on Thursday. The report, from the U.S. Department of Housing and Urban Development (HUD), said the number was down slightly from 2014. Many U.S. cities are confronting a sluggish economic recovery, stagnant or falling wages among the lowest-income earners and budget constraints for social welfare programs. Los Angeles, Seattle, Portland, Oregon and Hawaii have all recently declared emergencies over the rise of homelessness, and on Thursday Seattle’s mayor toured a new encampment for his city’s dispossessed. “Despite national estimates, New York City continues to experience near record homelessness,” said Giselle Routhier at the Coalition for the Homeless.

According to HUD’s latest tally, nearly 565,000 people were living on the streets in cars, in homeless shelters or in subsidized transitional housing during a one-night national survey in January. Nearly one-fourth were aged 18 or under. That number was down 2% from the previous year’s count and 11% from 2007, HUD said. The actual U.S. homeless population is likely higher than HUD’s snapshot suggests because many people living without the means to put a roof over their heads are beyond the reach of the survey, sleeping on a friend’s couch or a relative’s basement. HUD reported separately this month that roughly 1.49 million individuals used a shelter in 2014, up 4.6% from 2013, agency spokeswoman Heather Fluit said.

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