Jun 162019
 
 June 16, 2019  Posted by at 9:03 am Finance Tagged with: , , , , , , , , , , ,  


Keith Haring Untitled 1984

 

Ai Weiwei on Hong Kong and Assange (Rep.)
ECB Will Act If Inflation Expectations Are De-Anchored: de Guindos (R.)
European Banks Sink to Dec 24, 2018 Level – First Seen in 1995 (WS)
Pentagon Keeps Trump in the Dark About its Cyber Attacks on Russia (RS)
Boris Johnson’s No-Deal Brexit Plan ‘Will Trigger Early Election’ (O.)
Hundreds Dressed In Black Rally To Demand Hong Kong Leader Steps Down (R.)
Is The Caspian A Sea Or A Lake? (ZH)
Pilots Reveal Safety Fears Over Boeing’s Fleet Of Dreamliners (O.)
Record CO2 Emissions In 2018 Driven By Surging Use Of Gas (CB)
Hundreds Of Dolphins Have Died Along Gulf Coast Since February (AP)
Namibia Forced By Drought To Auction 1,000 Wild Animals (AFP)

 

 

“Julian Assange is a political prisoner. Clearly. There is no clearer definition than that.”

Interview in Italy’s La Repubblica, translation is a bit dodgy.

Ai Weiwei on Hong Kong and Assange (Rep.)

“How could he defend himself? He will not be under a clear law environment if he is taken to the US or already now as he has been holding in Europe, UK. Julian Assange is a political prisoner. Clearly. There is no clearer definition than that. What Assange did is not more than any newspaper does or publish important information that they think the people need to know. I think that if Assange is extradited, it will have huge consequences not just to it but also to the European moral or legal system. And it would completely redefine Europe as a place not caring about human rights anymore. Unfortunately this is happening all the time. But this time it will be clearly remembered as a landmark of the failure of our times.

It’s very interesting if you look at what’s happening about extradition. There are three cases about that going on in the world: Hong Kong, Assange and Huawei case, here the daughter of the founder is jailed in Canada because the US asked her extradition. I don’t know if she is a political prisoner but for sure she is part of the US strategy to limit China’s development in the world and the possibility of becoming a global leader. I’m not saying if it is right or wrong but it is fair this kind of situation. These three cases resemble a very interesting judicial challenge. At this moment after globalization the whole political structure of the world is being restored.


Now it’s starting to be challenged at the foundation of our rules, how do you readjust those rules and how to protect individuals’ freedom from the interest of state powers. That is a new task that any establishment of rule has to be concerned with. Nobody had put this together. This is an issue now embodied by different characters but actually it is one character.

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Remember: central bankers don’t have to actually understand what they do (and they don’t), they just have to make you believe they do.

ECB Will Act If Inflation Expectations Are De-Anchored: de Guindos (R.)

Longer-term inflation expectations in the euro zone need to come unstuck for the European Central Bank to provide more stimulus, ECB Vice President Luis de Guindos was quoted on Saturday as saying. With growth slowing and inflation staying well below the ECB’s target, the bank recently raised the prospect of even more stimulus, arguing that a rate cut or even more asset purchases may become necessary. “What we need to see is a de-anchoring of inflation expectations,” de Guindos told Italian newspaper Corriere della Sera when asked what the bank needed to see to provide more stimulus. “This has not yet happened, despite the fact that there has been a drop in market-based inflation expectations.”


With interest rates already at record lows and a 2.6 trillion euro ($2.9 trillion) bond purchase scheme ended just last year, analysts argue that the ECB has very little actual firepower left as its remaining tools lack significant potency. “If there is a further deterioration, then we will react,” de Guindos added. “But for now, our monetary policy stance is fully compatible with both inflation and real activity.” But de Guindos added that monetary policy is largely powerless against the impact of global trade disputes, one of the biggest drags on growth and thus inflation. “You can certainly smooth the impact with monetary policy, but you will not be able to address and fix this kind of problems with monetary policy,” he said.

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“..the introduction of negative policy rates by the European Central Bank in mid-2014 leads to more risk-taking and less lending by euro-area banks..”

European Banks Sink to Dec 24, 2018 Level – First Seen in 1995 (WS)

European bank shares – which have been getting crushed and re-crushed for 12 years – are getting re-crushed again. On Friday, the Stoxx 600 Banks index, which covers major European banks, including our hero Deutsche Bank, dropped to an intraday low of 130.5 and closed at 131.2, thereby revisiting the dismal depth of December 24, 2018 (130.8). European banks did not soar on the first trading day after Christmas, unlike other stocks. Instead they fell further and hit their multi-year low on December 27 (129). The index is down 21.5% from a year ago and 33% from January 2018:

[..] that 33% drop from January 2018 in the above chart is a minuscule dip in the long-term collapse-scenario going back to 2007. Buy and hold, indeed. Back to the level first seen in October 1995:

Part of the problem for European banks is NIRP, which was never designed to boost the real economy or make banks healthier so that they could support a vibrant economy. It was designed to boost bond prices and thereby bring yields down, which lowers the costs of borrowing for debt-sinner countries such as Italy, and allows them to borrow for free, which even Italy s government can do with maturities of up to one year. But there is a price to pay. The ECB released a paper in August 2018 where it admits that NIRP could cause a financial crisis because it’s terrible for many banks.


This is the chilling abstract of the paper: “We show that negative policy rates affect the supply of bank credit in a novel way. Banks are reluctant to pass on negative rates to depositors, which increases the funding cost of high-deposit banks, and reduces their net worth, relative to low-deposit banks. As a consequence, the introduction of negative policy rates by the European Central Bank in mid-2014 leads to more risk-taking and less lending by euro-area banks with greater reliance on deposit funding. Our results suggest that negative rates are less accommodative, and could pose a risk to financial stability, if lending is done by high-deposit banks.”

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“..those new laws are protecting American interests… by keeping the sitting president out of the loop. What a (scary) time to be alive.”

Pentagon Keeps Trump in the Dark About its Cyber Attacks on Russia (RS)

On Saturday, the New York Times published an important story about how the United States military branches are attempting to thwart and combat Russian cyber attacks on American utility networks and interference in elections. But deeper into the article, an interesting and disturbing nugget has drawn attention: The Pentagon has gone out of its way to keep President Donald Trump ignorant of certain details about the operation because of “the possibility that he might countermand it or discuss it with foreign officials.” After giving an in-depth account about the “deployment of American computer code” into Russia’s electric power grid, to work as both a warning to Russian President Vladimir Putin and a more offensive posture in the cyber warfare realm, The Times then wrote:


“Two administration officials said they believed Mr. Trump had not been briefed in any detail about the steps to place ‘implants’ — software code that can be used for surveillance or attack — inside the Russian grid. “Pentagon and intelligence officials described broad hesitation to go into detail with Mr. Trump about operations against Russia for concern over his reaction — and the possibility that he might countermand it or discuss it with foreign officials, as he did in 2017 when he mentioned a sensitive operation in Syria to the Russian foreign minister.” New laws, enacted by Congress last year, allow such “clandestine military activity” in cyberspace to go ahead without the president’s approval. So, in this case, those new laws are protecting American interests… by keeping the sitting president out of the loop. What a (scary) time to be alive.

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And then they can’t leave?!

Boris Johnson’s No-Deal Brexit Plan ‘Will Trigger Early Election’ (O.)

Boris Johnson’s attempts to appease hardline Tory Brexiters will tilt the party into a “disastrous general election” that could be just months away, senior Conservatives are warning. The runaway favourite to replace Theresa May is being told that the coalition of support set to deliver him Downing Street “won’t survive the autumn”, when he will have to decide whether to accept a deal with the EU or try to force a no-deal Brexit – a move likely to precipitate an election. Senior party figures are already warning of a “wipeout” in some parts of the country, such as Scotland and London, should it go into an election pledging to deliver a no-deal Brexit.


They believe that once in office, Johnson will either be toppled by hardline Eurosceptic MPs should he back away from no deal, or provoke an election by pursuing such a policy. With leadership contenders ruling out a coronation on Saturday, Tory critics are demanding increased scrutiny of Johnson’s Brexit plans. David Gauke, the justice secretary, said: “Boris is saying that he will definitely leave the EU by 31 October, but he is refusing to say how he will do this if parliament takes steps to stop a no-deal Brexit. Will he respond by suspending parliament? Will he seek a general election? This lack of clarity is helping him maintain a broad base of support for now but it won’t survive the autumn. This is why his position on Brexit needs to be tested thoroughly now.”

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“..if Lam was a stock he would recommend shorting her with a target price of zero. “Call it the Carrie trade.”

Hundreds Dressed In Black Rally To Demand Hong Kong Leader Steps Down (R.)

Activists set up gazebos as protesters, some carrying flowers, started to gather in sweltering summer heat to march from Victoria Park to Hong Kong’s central government offices. Beijing-backed Hong Kong Chief Executive Carrie Lam on Saturday indefinitely delayed the extradition bill that could send people to mainland China to face trial, expressing “deep sorrow and regret”. The about-face was one of the most significant political turnarounds by the Hong Kong government since Britain returned the territory to China in 1997, and it threw into question Lam’s ability to continue to lead the city. Activist investor David Webb, in a newsletter on Sunday, said if Lam was a stock he would recommend shorting her with a target price of zero.


“Call it the Carrie trade. She has irrevocably lost the public’s trust,” Webb said. “Her minders in Beijing, while expressing public support for now, have clearly lined her up for the chop by distancing themselves from the proposal in recent days.” Protest organizers are hoping more than a million people turn up for the Sunday rally, scheduled to start at 2.30pm local time, similar to numbers they estimated for a demonstration against the proposed extradition bill last Sunday. Police put that count at 240,000.

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Tyler’s headline: “How Iran Was Swindled Out Of $3.2 Trillion”. But there’s more to this story. The difference between a lake and a sea is huge for the law.

Is The Caspian A Sea Or A Lake? (ZH)

At stake is the allocation of revenues from the wider Caspian basins area, including both onshore and offshore fields, that is conservatively estimated to have around 48 billion barrels of oil and 292 trillion cubic feet (Tcf) of natural gas in proved and probable reserves. Around 41 percent of total Caspian crude oil and lease condensate and 36 percent of natural gas exists in the offshore fields, with an additional 35 percent of oil and 45 percent of gas estimated to lie onshore within 100 miles of the coast, particularly in Russia’s North Caucasus region. The remaining 12 billion barrels of oil and 56 Tcf of natural gas are believed to be variously located further onshore in the large Caspian Sea basins, mostly in Azerbaijan, Kazakhstan, and Turkmenistan. The area accounts for an average of 17 percent of the total oil production of the five littoral states that share its resources, on average totalling 2.5-2.9 million barrels per day (mbpd).

[..] the legal designation of the Caspian as either a ‘sea’ or a ‘lake’ would have far-reaching repercussions on the assignment of revenues from it. If it was designated a sea then coastal countries would apply the ‘United Nations Convention on the Law of the Sea’ (1982), in which event each littoral state would receive a territorial sea up to 12 nautical miles, an exclusive economic zone up to nautical 200 miles, and a continental shelf. In practice, this would mean that countries such as Turkmenistan and Azerbaijan would have exclusive access to offshore assets that Iran would not be able to access. If it was designated a lake – and this was the informal designation before the August agreement – then the countries could use the international law concerning border lakes to set boundaries, by which each country effectively possesses 20 percent of the sea floor and surface of the Caspian.

In the preparations for the signing of the ‘Convention on the Legal Status of the Caspian Sea’ last August, Iran had engaged lawyers to challenge the established 20 percent share that each littoral state had informally agreed upon, based on the fact that Russia should have used its own original 50 percent share to make good stakes for its former USSR states. [..] Moscow was the prime mover in having the Caspian designated as a sea, not a lake. This was on the basis that because Russia had opened up the channel from the Volga River into the Caspian to prevent the levels dropping, the Caspian no longer conformed to the legal definition of a lake, which is that it is a localised water deposit standing independent of any river that serves to feed it.

[..] “This meant, effectively, that Russia could divide up the shares as it saw fit, and the way it saw fit was to benefit its existing ally, Kazakhstan, which was assigned a 28.9 percent share, and its wished-for ally, Azerbaijan, which secured a 21 percent stake, while Russia saw a slight increase, to 21 percent, while Turkmenistan’s share goes down to 17.225 percent, as it is seen as a softer touch by Russia, and Iran’s share goes down to just 11.875 percent,” said the Iran source. “This switch from 50 percent to just over 11 percent means that Iran will lose at least US$3.2 trillion in revenues from the disputed and lost value of energy products going forward,” concluded the Iran source.

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Can’t catch a break: “we would have to fly with a burning wing for up to three hours before we could safely land..”

Pilots Reveal Safety Fears Over Boeing’s Fleet Of Dreamliners (O.)

Airline pilots have voiced fears over the safety of a fleet of Boeing aircraft after a crucial fire-fighting system has been found to have the potential to malfunction. Boeing has issued an alert to airlines using its flagship B787 Dreamliner, warning that the switch used to extinguish an engine fire has failed in a “small number” of instances. The switch also severs the fuel supply and the hydraulic fluid to prevent flames spreading. UK airlines Tui, British Airways and Virgin Atlantic operate more than 60 Dreamliners between them. The US regulator, the Federal Aviation Administration (FAA), has decided not to ground the fleet, despite admitting a “risk to the flying public”.

Pilots, however, claim that the safety of passengers and crew is being compromised. “If there was an engine fire on a transatlantic flight and the aircraft had one of the defective fire switches, then we would have to fly with a burning wing for up to three hours before we could safely land,” a pilot with a British airline told the Observer. In its alert to airlines, Boeing warns that long-term heating can cause the fire switch to stick in the locked position so it can’t be used to release the two fire extinguishers in each engine.


[..] “Boeing insists that the risk of an engine fire is very low, and that’s true, but it’s Boeing’s attitude to the risk that has upset us, especially in light of recent B737 Max issues. If the fire switch malfunctions, there’s no manual override to deploy the engine fire extinguishers and therefore no way of putting out a fire, but Boeing says that it’s fine, and the airlines agree. Such is the fear of Boeing’s power that no one dares speak out.”

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More. And more.

Record CO2 Emissions In 2018 Driven By Surging Use Of Gas (CB)

Last year saw record levels of CO2 emissions, gas and oil use, and installations of renewable energy, according to new global data from oil giant BP. Gas was the largest driver of energy-use growth in 2018, responsible for more than 40% of the increase. This, along with increased use of oil and coal, led to global CO2 emissions rising by 2% in 2018, the largest year-on-year increase in seven years. Renewable energy sources were the largest source of new electricity generation worldwide for the third year in a row, driven primarily by the growth of wind and solar generation. Wind and solar grew at their second fastest rate on record, driven by growth in China, though the growth in wind and solar generation in the US, EU, and India was slower in 2018 than in 2017.

However, there is a constantly growing gap between today’s energy use and what would be needed to meet the goals of the Paris Agreement, given that emissions must, according to scientists, reach net-zero by mid-century to avoid dangerous levels of global warming. Energy use grew in 2018 at a rate of 2.9%, the largest growth since 2010. China, the US and India accounted for more than two-thirds of global energy-use growth, with US energy use expanding at the fastest rate for 30 years. Energy use increased by 390m tonnes of oil equivalent (Mtoe) in 2018. Fossil fuels were responsible for 71% of this, while near-zero-carbon energy sources, including solar, wind, hydro and nuclear, were responsible for 29%.


Natural gas represented the single largest contributor to global energy-use growth in 2018, increasing by 5.3% compared to 2017. It alone was responsible for 40% of the increase in total energy use. Non-hydro renewables grew by 14.5% in 2018. This was the largest relative growth of any energy source, though it was still below the record growth experienced in 2017. Non-hydro renewables now represent 4% of global energy use, with all zero-carbon sources representing 15% of global energy. Oil consumption grew by 1.5% in 2018, with China and the US contributing around 85% of the growth in oil use. This growth was primarily concentrated in the transportation sector, reflecting increased vehicle ownership and miles driven.

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Oil.

Hundreds Of Dolphins Have Died Along Gulf Coast Since February (AP)

At least 279 dolphins have become stranded across much of the US Gulf Coast since the start of February, triple the usual number, and about 98% of them have died, scientists from the National Oceanic and Atmospheric Administration (Noaa) said. Scientists will investigate whether lingering effects from the 2010 BP oil spill and more immediate effects from low salinity because of freshwater flowing from high rivers and a Louisiana spillway contributed to the deaths, said Teri Rowles, coordinator for Noaa fisheries’ marine mammal health and stranding response program. BP spill effects included problems with lungs and adrenal glands, which produce stress-related hormones; blood abnormalities; and general poor condition, according to earlier reports.

Those reports said the spill contributed to the Gulf of Mexico’s largest and longest dolphin die-off. “We do know some of the health conditions … are improving, but some have been slow to improve,” Rowles said on Friday. “Reproduction in the heaviest-oiled areas continues below normal.” Erin Fougeres, administrator for the marine mammal stranding program in Noaa fisheries’ south-east region, said 23% of the dolphins stranded from Louisiana to the Florida Panhandle had sores consistent with freshwater exposure. Such lesions are “not uncommon” in the spring, according to Noaa’s website. Mississippi had 121 dolphin strandings as of Wednesday, with 89 in Louisiana, 32 in Alabama and 37 in Florida, Fougeres said.


Moby Solangi, director of the Institute of Marine Mammal Studies in Gulfport, Mississippi, put that state’s total on Thursday at 126, and said the opening of the Bonnet Carré spillway was at least partly to blame.The effects were worse for Mississippi’s dolphins than the BP spill was, he said, noting that 91 dead dolphins were found in Mississippi during all of 2010. Dolphins continued to die for years because of oil spill damage, a 2015 study reported. Freshwater exposure “doesn’t appear to be the cause of death for all animals, so that’s something we’re continuing to investigate”, Fougeres said. Rowles noted that 70% of the carcasses were too decomposed for necropsy.

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There must be better ways.

Namibia Forced By Drought To Auction 1,000 Wild Animals (AFP)

Drought-hit Namibia has authorised the sale of at least 1,000 wild animals – including elephants and giraffes – to limit loss of life and generate US$1.1 million for conservation, the authorities confirmed Saturday. “Given that this year is a drought year, the [environment] ministry would like to sell various type of game species from various protected areas to protect grazing and at the same time to also generate much needed funding for parks and wildlife management,” the environment ministry spokesman Romeo Muyunda said. The authorities declared a national disaster last month, and the meteorological services in the southern African nation estimate that some parts of the country faced the deadliest drought in as many as 90 years.

“The grazing condition in most of our parks is extremely poor and if we do not reduce the number of animals, this will lead to loss of an animals due to starvation,” Muyunda said. In April, an agriculture ministry report said 63,700 animals died in 2018 because of deteriorating grazing conditions brought on by dry weather. Namibia’s cabinet announced this week that the government would sell about 1,000 wild animals. They include 600 disease-free buffalos, 150 springbok, 65 oryx, 60 giraffes, 35 eland, 28 elephants, 20 impala and 16 kudus – all from national parks. The aim is to raise $1.1 m that will go towards a state-owned Game Products Trust Fund for wildlife conservation and parks management.


The government said there were currently about 960 buffalos in its national parks, 2,000 springbok, 780 oryx and 6,400 elephants. The auction was advertised in local newspapers from Friday. Namibia, a country of 2.4 million people, has previously made calls for aid to assist in the drought emergency that has already affected over 500,000 people.

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May 302019
 
 May 30, 2019  Posted by at 9:48 am Finance Tagged with: , , , , , , , , , , ,  


 

WikiLeaks Expresses ‘Grave Concerns’ for Assange’s Health (CN)
Press Freedom is Under Threat in the Land of its Birth (CP)
Putin Has A Mueller Pee Tape (RT)
The Limits of American Destructiveness (Dmitry Orlov)
China Accuses US Of ‘Naked Economic Terrorism’ (AFP)
Why Tesla At $10 Is Not Far-Fetched (Colombo)
UK Car Production Plunged By Nearly Half In April (G.)
Boris Johnson To Face Court Over Brexit Claims (R.)
Boeing 737 MAX Won’t Fly Again Before August – IATA (G.)
The Day Einstein Became A Global Star (Dunn)
Good News: Elephant Slaughter Down. Bad News: They Still Face Total Doom (AFP)

 

 

“Assange’s health has deteriorated too much to appear via video link for today’s extradition hearing in central London. It may now take place at Belmarsh prison.”

WikiLeaks Expresses ‘Grave Concerns’ for Assange’s Health (CN)

WikiLeaks has condemned Britain for its treatment of Julian Assange, expressing “grave concerns” for the health of its publisher who has been transferred to the health ward of Belmarsh prison in London. In a statement released on Twitter on Wednesday, the publication also condemned Ecuador for having created conditions “incompatible with basic human rights” for Assange, who had been granted asylum in its London embassy and remained there for seven years. He was cutoff the last year from the internet with only minimal visits permitted. [..] Britain had twice ignored rulings by the United Nations working group on arbitrary detention that the UK should let Assange free and pay him compensation.


“The UK’s refusal to abide by UN rulings, and its subsequent treatment of Mr. Assange since his arrest, presents serious questions about the UK’s standing as a human rights-abiding nation,” WikiLeaks said in its statement. Assange has been kept in isolation for 23 hours a day at Belmarsh, and has been allowed only a handful of visits from his lawyers. The UN’s special rapporteur for torture visited him with a doctor, who examined Assange, earlier this month. The rapporteur’s report has not yet been released. “During the seven weeks in Belmarsh his health has continued to deteriorate and he has dramatically lost weight,” WikiLeaks said.

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“.. the tradition of press freedom was actually established way back in 1735..”

Press Freedom is Under Threat in the Land of its Birth (CP)

Assange had always claimed that he had skipped bail on a scheduled court hearing over a Swedish government extradition request that it was all a trumped up affair designed to get him to Sweden where he could then more easily be deported to the US to face espionage charges. That claim was scoffed at by British prosecutors, Swedish prosecutors and by most of the US media, including publications like the NY Times and the Washington Post. Those two publications had been all too happy to publish Wikileaks documents, but both have subsequently derisively mocked Assange’s claim to be a fellow publisher and journalist entitled to First Amendment protection from US prosecution for Wikileaks’ releasing of classified government documents obtained from whistleblowers like Snowden and Army private Chelsea Manning.

These smug supposed models of journalistic professionalism and integrity have been happy to have Assange’s Wikileaks do the dirty drudge work of gaining the trust of whistleblowers, receiving their leaked classified materials documenting criminal and corrupt behavior by the US and other governments, and disseminating those documents to the world’s media while protecting their sources — the very job that the reporters at publications like the Times and Post should be doing — but then turn around and claim that Assange is not a real journalist and Wikileaks is not a real publication because it supposedly doesn’t have a fine, professional editorial staff vetting its documents to protect privacy and of course “national security.” It’s a joke really, when one considers the error-filled and propaganda-peddling articles both publications regularly put into print despite or perhaps with the endorsement of those “professional” editors. (Besides which Wikileaks does review and where necessary, properly censors the material it releases.)

This pinched view of what constitutes the “press” when it comes to First Amendment protection ignores the reality that the tradition of press freedom was actually established way back in 1735, well before the founding of the United States or the passage of the Constitution and Bill of Rights. That’s when John Peter Zenger, the owner of a printing press in the colony of New York on which he published a small newspaper, the New York Weekly Journal, won acquittal in a criminal libel suit brought against him by the governor of the colony of New York. Was Zenger, an immigrant from Germany who’s English skills are described as “poor,” a “real” journalist with an editor overseeing his work for accuracy when he won that groundbreaking case? No. And how about that journalistic pioneer Ben Franklin? Did he have an editor checking his work for accuracy, respect for privacy, etc. in 1729 when he and partner Hugh Meredith began publishing their Pennsylvania Gazette? Of course not!

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How upside down is this?

Muellker: “If we had confidence that the president clearly did not commit a crime, we would have said so.”

Putin Has A Mueller Pee Tape (RT)

After Special Counsel Robert Mueller delivered a public statement standing by the findings of his final report, liberal commentators began reading between the lines. How long before Putin is accused of getting to Mueller?
Mueller delivered his public statement on Wednesday, and offered very few surprises. His final report, which cleared President Donald Trump of colluding with Russia in 2016 and found insufficient evidence to bring obstruction charges against the president, “speaks for itself,” Mueller said. The Special Counsel also stated that Attorney General William Barr has already “made the report on our investigation largely public,” and that he would not testify on anything beyond the publicly available information.

So a bland statement of Justice Department policy? On the surface, yes. But that didn’t stop Democrats from clamoring for further investigations, or viewing Mueller’s declination to prosecute as a dog-whistle for impeachment. Journalist Mark Ames joked that “Putin has a Mueller pee tape,” a reference to one particularly lurid tale presented in the ‘Steele Dossier.’ Ironically, the Steele Dossier –though completely uncorroborated– was used by the FBI to justify surveilling the Trump campaign and played a central role in kick-starting the investigation that Mueller eventually took over. Ames added: “If Maddow doesn’t air a segment tonight claiming Putin has a Mueller pee tape, it can only mean one thing–Putin has a Maddow pee tape.”

Are Robert Mueller and MSNBC’s Rachel Maddow guilty by urination? Well, no, but the idea that Maddow would air such a segment on Mueller is not a far-fetched one. In the two years since Mueller took over the ‘Russiagate’ investigation, Maddow has flung dung-heaps of conspiratorial Russian nonsense at viewers every night. There was her warning that the Kremlin could “flip the off switch” on the US power grid and freeze Americans to death last winter, the suggestion that Trump personally paid for the services of “Russian hackers,” and the insistence that Vladimir Putin would use the (then debunked) ‘Pee Tape’ to force Trump to withdraw US troops from Eastern Europe (the exact opposite happened).

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“You can’t tell anything by looking at [Pompeo’s] smirking fat mug, but I am sure that he was crying on the inside.”

The Limits of American Destructiveness (Dmitry Orlov)

When Saddam Hussein decided to start selling oil for euros, the CIA organized a provocation that caused him to invade Kuweit as punishment for stealing Iraqi oil. This allowed the US to organize a gigantic expeditionary force with divisions from a large number of countries, including Syria and Egypt and pretty much all of NATO. After a decade of Hussein festering in place, a somewhat smaller coalition dealt him the coup de grâce, destroying Iraq in the process. The victims of the American invasion and occupation outnumber Saddam Hussein’s victims by orders of magnitude. Later, the same thing was done to Muammar Qaddafi, for similar reasons, and Libya is likely to remain as a ruin. There, some sort of minor coalition was cobbled together.

But now the US finds that it urgently needs to knock out Iran because otherwise it will be too late. It is time to form a new coalition and Mike Pompeo has started racing around Eurasia. First off, he offended the Germans by canceling his state visit with Angela Merkel on a moment’s notice and without offering a reason. Instead, he flew to Baghdad—a perfect location for launching an attack on Iran, except that the Iraqi response was a message of solidarity with Iran, willingness to mediate the US-Iranian dispute, and consideration of a ban on US troops on Iraqi soil.

And so Mike flew to Sochi, where he met with Russian foreign minister Sergei Lavrov and, briefly, with Putin. Most likely, Putin told him where he can stuff his war plans, and so Mike canceled his planned trip to Moscow, to avoid having Sergei Lavrov wipe his feet on him again. And so Mike flew on to Europe, where he got a quick “no” on Iran from EU foreign policy head Federica Mogherini and an outright refusal to meet from the foreign ministers of France, Germany and Great Britain. And so Mike flew back to Washington. You can’t tell anything by looking at his smirking fat mug, but I am sure that he was crying on the inside.

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Thinking about that term. Is it the opposite of all-dressed economic terrorism?

China Accuses US Of ‘Naked Economic Terrorism’ (AFP)

China accused the United States of “naked economic terrorism” on Thursday as Beijing ramps up the rhetoric in their trade war. The world’s top two economies are at loggerheads as trade talks have apparently stalled, with US President Donald Trump hiking tariffs on Chinese goods earlier this month and blacklisting telecom giant Huawei. “We are against the trade war, but we are not afraid of it,” vice foreign minister Zhang Hanhui said at a press briefing to preview President Xi Jinping’s trip to Russia next week. “This premeditated instigation of a trade conflict is naked economic terrorism, economic chauvinism, and economic bullying,” Zhang said, stressing that China opposes the systematic use of sanctions, tariffs and protectionism. “There is no winner in a trade war,” he warned.


China has hit back with its own tariff increase that will take effect June 1, while state media has suggested that Beijing could stop exports of rare earths to the United States, depriving Washington of a key resource used to make hi-tech products. Meanwhile, state media and officials have stepped up the rhetoric, tapping patriotic fervour as the Communist Party digs in for what could be a long fight with the United States. An anchor for the English-language state broadcaster China Global Television Network (CGTN) even held a rare debate on Thursday with a presenter from Fox Business Network to discuss the trade war after jousting on social media. The debate between CGTN’s Liu Xin and Fox Business’s Trish Regan was civil, with the American journalist saying “I appreciate you being here” and the Chinese anchor inviting her to come to China, adding “I will take you around”.

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No bubble, no Tesla.

Why Tesla At $10 Is Not Far-Fetched (Colombo)

Last week, Morgan Stanley analyst Adam Jonas shocked the investing world by cutting his worst-case forecast for Tesla stock from $97 to just $10 per share (it was trading at approximately $200 per share at the time of the announcement). Jonas cited the company’s heavy debt load and exposure to China as the main reasons for his downgraded outlook – “The reduction in our bear case to $10 is driven primarily by our concerns around Chinese demand for Tesla products.” “Our revised bear case assumes Tesla misses our current Chinese volume forecast by roughly half to account for the highly volatile trade situation in the region, particularly around areas of technology, which we believe run a high and increasing risk of government/regulatory attention.” Tesla’s stock price has plunged by over 50% or $200 since its peak in December:

While most analysts and financial journalists completely laughed off Adam Jonas’ $10 worst-case forecast for Tesla stock, what immediately came to my mind was that it was not far-fetched at all. While Jonas’ basis for that price was the company’s heavy debt load and exposure to China, which are both valid risks in their own right, I have been warning about a much larger macro risk that virtually nobody else is discussing: Tesla’s exposure to the U.S. household wealth bubble. To summarize my argument, U.S. household wealth has been experiencing a bubble in recent years because the Fed has artificially inflated stock and bond prices. This household wealth bubble has created a wealth effect that has helped to temporarily boost consumer spending, including sales of Tesla automobiles.


Tesla is a luxury car company that sells expensive cars to affluent people, and the U.S. is responsible for approximately half of Tesla’s sales. As much as Tesla has been struggling (Tesla lost nearly $1 billion in 2018 and $2 billion in 2017), those struggles are occurring during the largest wealth bubble that has ever occurred in America’s history. If Tesla can’t make it in this frothy environment, they’re not going to make it period. Unfortunately, like all bubbles, today’s household wealth bubble will violently burst, just like it did in the early-2000s and in 2008 and 2009. When that happens, Tesla will bleed red ink like never before and $10 per share may become a reality.

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And I think that’s a good thing.

UK Car Production Plunged By Nearly Half In April (G.)

Car production plunged by nearly half in April as factories shut down to prepare for a Brexit date that never came, prompting renewed anguish from the UK motor industry at the “untold damage” done by prolonged uncertainty. In a slump that the Society of Motor Manufacturers and Traders (SMMT) described as “extraordinary”, 70,971 vehicles rolled off the production lines in April, down 44.5% from 127,970 in the same month of last year. Labour said the figures showed that the government’s “mishandling” of Brexit was already hurting carmakers, warning of further pain if the next Tory leader backs leaving the EU without a deal.

The majority of the decline in production was down to large automotive firms such as Jaguar Land Rover, BMW and Peugeot bringing forward annual maintenance stoppages that usually take place in the summer. By moving the date of the planned shutdowns, they hoped to ensure that any disruption to their supply lines around 29 March – the original date of Brexit – took place while production lines were already idling, minimising the impact. However, the postponement of the UK’s exit from the EU means that the stoppages, which the SMMT called “costly”, proved to be needless. The shutdowns cannot be repeated over the new Brexit date of 31 October, meaning car firms will have to bear any slowdown to their vital “just-in-time” manufacturing processes during a period of full-scale output.

[..] April’s fall in vehicle production is the 11th straight monthly decline, with previous falls put down to sluggish demand in international markets including the EU, US and China. However, the 44.5% slump in April was much steeper than the 15% seen in February and the 13% reported in March, with the SMMT blaming Brexit contingency plans.

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“..he lied about Brexit by stating Britain would be 350 million pounds a week better off outside the EU..”

Boris Johnson To Face Court Over Brexit Claims (R.)

Boris Johnson, the favourite to replace Theresa May as British prime minister, must appear in court over allegations he lied about Brexit by stating Britain would be 350 million pounds a week better off outside the EU, a judge ruled on Wednesday. The figure, famously emblazoned on a campaign bus, was a central and controversial part of the Leave campaign’s successful “take back control” message ahead of the 2016 Brexit referendum. Opponents argued that it was deliberately misleading and it became symbolic of the divisions caused by the referendum, which saw Britons vote by 52%-48% to leave the European Union.


District Judge Margot Coleman ruled that Johnson, a former British foreign secretary and ex-mayor of London, must answer a private summons alleging he had committed three criminal offences of misconduct in a public office. In her written ruling at London’s Westminster Magistrates’ Court, Coleman said the accusations were not proven. But she added: “Having considered all the relevant factors I am satisfied that this is a proper case to issue the summons as requested for the three offences as drafted. “This means the proposed defendant will be required to attend this court for a preliminary hearing, and the case will then be sent to the Crown Court for trial,” she said.

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The pressure mounts.

Boeing 737 MAX Won’t Fly Again Before August – IATA (G.)

The Boeing 737 Max aircraft will not return to the skies before August, according to the head of aviation’s main trade body.The 737 Max was grounded by regulators in the wake of two crashes, and although manufacturer Boeing has been working on a fix to allay safety concerns, it is likely to remain out of service for another 10 to 12 weeks, into peak season for many airlines. Alexandre de Juniac, the chief executive of the International Air Transport Association, said the timing would depend on regulators, but he hoped to see a unified global timetable for the model’s reintroduction. [..] Speaking in Seoul ahead of the association’s annual meeting, De Juniac said airlines were not expecting a return to service within the next 10 to 12 weeks: “But it is not our hands. That is in the hands of regulators.”

Iata is planning a summit meeting between airlines, regulators and Boeing in July to discuss a coordinated timeline to restore the 737 Max to commercial flying, De Juniac said. “We hope that [the regulators] will align their timeframe,” he said. The 737 Max disasters have ignited tensions between regulators on either side of the Atlantic, amid concerns over the FAA’s relationship with Boeing, including the degree of self-certification. Ethiopia chose to send the data recorders from the crash to safety investigators in Paris, and the European Union Aviation Safety Agency has indicated it would carry out its own assessment of the 737 fix, rather than rely on the FAA. According to Reuters, sources at ICAO, the UN aviation agency, believe the FAA will approve the 737 Max again as soon as late June.

US operators United Airlines, American Airlines and Southwest Airlines, early customers of the model sold as a more fuel-efficient iteration of the 737 shorthaul workhorse, have removed the planes from their flight schedules until early to mid-August. De Juniac said prolonged grounding was “taking its toll” on airlines. Although Iata expects its 290 airline members to be recording a 10th consecutive year of aggregate profit, he said the 737 was adding to headwinds including “rising costs, trade wars and other uncertainties [that] are likely to have an impact on the bottom line”.

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May 29 1919.

The Day Einstein Became A Global Star (Dunn)

One hundred years ago, two teams of British astronomers travelled thousands of miles to photograph the solar eclipse of 29 May 1919. But they weren’t just there for the spectacle – they intended to prove Albert Einstein’s relativity theory. Much like today, few people understood Einstein’s work in the 1910s. Those who could get their head round it, however, knew that if his ideas were correct, a massive body like the Sun would bend any light passing near it. A way to test this would be to photograph the stars around the Sun during an eclipse and then photograph them again when the Sun was further away from them. Comparing the images would allow you to measure any displacement in the stars’ apparent positions.

According to Einstein’s theories, the change should be 1.75 arcseconds, twice the value predicted by Newtonian physics. To put that figure in context, it’s like trying to measure the width of a penny from a mile away. But that was exactly what two teams of British astronomers hoped to do in 1919. To add to the challenge, they had to transport their equipment to Sobral in northern Brazil, and the island of Príncipe, off the west coast of Africa. One of the architects of the plan was Arthur Stanley Eddington, professor of astronomy at Cambridge and an active promoter of Einstein’s theories (he was one of the few people who understood them). As a Quaker and pacifist, he also welcomed the opportunity to promote international cooperation after global war.

Eddington went to Príncipe with clockmaker Edwin Cottingham, while Charles Davidson and Andrew Crommelin of the Royal Observatory, Greenwich, went to Brazil. Each team took a large telescope, used to capture the image fed into it from a coelostat, a clockwork-driven mirror that counteracted Earth’s rotation during long exposures of up to half a minute. The Sobral team also took a second, smaller telescope as backup. [..] It was only in November 1919 that the results were announced at a meeting in London. When they were, it was the photographs from the smaller telescope at Sobral that proved decisive and were then distributed to astronomers worldwide.

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Death penalty. Nothing else works.

Good News: Elephant Slaughter Down. Bad News: They Still Face Total Doom (AFP)

The illegal slaughter of African elephants to feed Asia’s demand for ivory has decreased by more than half in eight years, but the majestic mammals are still threatened with extinction, researchers warned. In 2011, poachers killed some 40,000 tuskers – about 10 per cent of the continent’s population, according to figures from the Convention on International Trade in Endangered Species (CITES), based in Geneva. Last year the kill rate was about four per cent, or 15,000 animals, according to new research published in Nature Communications. “We are seeing a downturn in poaching, but it is still above what we think is sustainable,” co-author Colin Beale, a conservation biologist at the University of York, said.


On current trends, the African elephant is in danger of being “virtually wiped out”, surviving only in small, heavily protected pockets, he said. A century ago up to 12 million of the world’s heaviest land animal roamed the continent. Today, they number about 500,000, if forest elephants – a subspecies – are included. Despite a 1990 ban on international trade in ivory, demand in Southeast Asia and especially China has overwhelmed the capacity of local and global authorities to curb the carnage. “Currently, poaching is worst in west and central Africa,” said Beale. “I worry most for the future of forest elephants.” Smaller, more solitary than their cousins on the savannah, forest tuskers in the Congo Basin are estimated to have declined by 65 per cent over the last 15 years alone.

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May 162019
 
 May 16, 2019  Posted by at 9:56 am Finance Tagged with: , , , , , , , , , , , , ,  


AFP Photo/TIMOTHY A. CLARY Jeff Koons – Stainless steel casting of inflatable rabbit (41″) sold for $91.1 million

 

Tulsi Gabbard Would Drop Julian Assange Charges, Pardon Edward Snowden (NW)
2020 Democratic Presidential Candidates Can’t Win Against Trump – Cuban (SC)
Russiagate’s Monstrous Offspring (Lazare)
The REAL Story Behind The Russian Hoax (Graham Noble)
The Disinformationists (Hopkins)
No “Do-Over” On Russia Probe: White House Tells Nadler To Pound Sand (ZH)
Barr’s Investigator John Durham Once Probed Mueller in a Shocking Case (S. Noble)
Trump Declares National Emergency Over IT Threats (BBC)
US Blacklists Huawei (R.)
UK Labour To Renationalize Energy Network End Consumer ‘Rip-Off’ (G.)
Majority Of Europeans Expect End Of EU Within 20 Years (G.)
Pilots ‘Raised Boeing Safety Fears’ Months Before Ethiopia Crash (BBC)
Single-Use Plastics A Serious Climate Change Hazard (G.)
Zimbabwe Sells 100 Elephants To China, Dubai (AFP)

 

 

Her own party will make sure that never happens.

Tulsi Gabbard Would Drop Julian Assange Charges, Pardon Edward Snowden (NW)

(start video 1.40.00 in)

Representative Tulsi Gabbard, a Democratic presidential candidate, said the U.S. should drop criminal charges against Julian Assange and Edward Snowden. The military veteran said during a lengthy interview on the Joe Rogan Experience podcast this week that WikiLeaks founder Assange and national security whistleblower Snowden should not be prosecuted for disclosing information. “What would you do about Julian Assange, what would you do about Edward Snowden?” Rogan asked. Gabbard said, if elected, she would drop the Assange charges and pardon Snowden. “We have got to address why [Snowden] did things the way that he did them,” she said.

“You hear the same thing from Chelsea Manning, how there is not an actual channel for whistleblowers like them to bring forward information that exposes egregious abuses of our constitutional rights and liberties, period. There was not a channel for that to happen in a real way, and that’s why they ended up taking the path that they did, and suffering the consequences.” In June 2013, Snowden handed over to journalists a trove of National Security Agency documents detailing a sprawling surveillance apparatus used by global intelligence agencies. The leak showed how the systems could be used to spy on U.S. citizens through their phone calls, text messages and internet use.

After fleeing the country to Hong Kong, a warrant was issued for Snowden’s arrest. Snowden was left stranded in Russia, where he was provided asylum. Gabbard told the podcast host that she could still remember the day she first read the details about mass surveillance in the American press. “I was shocked,” she said. “That was something that Snowden uncovered and released, something that I don’t know that even as members of Congress we would have been aware of,” Gabbard continued. “So now that we are aware of it, we can take action to close those loopholes, to change those policies, to protect our civil liberties… Was the NSA going to disclose that information voluntarily? Absolutely not.”

Assange, whose organization helped facilitate Snowden’s escape, was dramatically arrested last month and has been charged with conspiracy to commit computer hacking for “agreeing to break a password to a classified U.S. government computer,” the Justice Department said. On Monday, Sweden reopened its investigation into a rape allegation against Assange, who is now serving 50 weeks in a high-security U.K. prison relating to a 2010 bail violation. As a result, the WikiLeaks founder, who denies the assault allegation, is now facing two extradition charges.

“What happened with his arrest and all this stuff that just went down I think poses a great threat to our freedom of the press and to our freedom of speech,” Gabbard said. “The fact that the Trump administration has chosen to ignore how important it is that we uphold our freedoms…and go after him, it has a very chilling effect on both journalists and publishers…and also on every one of us as Americans. It was a warning call…saying ‘look what happened to this guy.’ It could happen to you. It could happen to any one of us.”

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I think he’s right.

2020 Democratic Presidential Candidates Can’t Win Against Trump – Cuban (SC)

Mark Cuban was interviewed by Scott Wapner on CNBC on Tuesday. When asked about 2020 race and whether he’d consider running, he left open the possibility saying: “We’ll see.” “We’ll see what happens. It would take the perfect storm for me to do it,” the owner of Dallas Mavericks said. “There’s some things that could open the door, but I’m not projecting or predicting it right now.” “I still think there’s a real opportunity for somebody who is in the middle but has some charisma, has the ability to relate to both sides but is not a politician. The reality is people don’t trust politicians,” Cuban said. When asked who on the Democratic side has the best chance of winning, Cuban said “nobody right now.” “If you look at why people voted for Donald Trump, in my opinion, first and foremost it was because he wasn’t a politician…Politicians are the least trusted of every profession,” said Cuban.

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“The idea that America may in anyway be responsible for its own fate is of course unthinkable.”

Russiagate’s Monstrous Offspring (Lazare)

Assange is guiltier than ever. If Washington gets its hands on him, he’ll no doubt be hauled before some sort of Star Chamber and then clapped in a dungeon somewhere until he confesses that Russian intelligence made him do it, even though a careful reading of the Mueller report strongly suggests the opposite. Assange languishing behind bars, war breaking out in Latin America or the Persian Gulf, Trump in the Oval Office for four years more – it’s the worst of all possible worlds, and the Democratic Party’s bizarre fixation with Vladimir Putin is what’s pushing it.


Ultimately, Russia-gate is yet a variation on the tired old theme of American innocence. If something goes wrong, it can’t be the fault of decent Americans who, as we all know, are too good for our deeply flawed world. Rather, it must be the fault of dastardly foreigners trying to hack our democracy. It’s a deep-rooted form of xenophobia that has fueled everything from the criminalization of marijuana (smuggled in by evil Mexicans) to the 1950s Red Scare (a reaction to Communism smuggled in by evil Russians), and the war on terrorism (the work of evil Muslims). The idea that America may in anyway be responsible for its own fate is of course unthinkable.

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What will be the reactions when Brennan, Clapper, Comey are indicted?

The REAL Story Behind The Russian Hoax (Graham Noble)

If there is any issue that cries out for a special counsel investigation, it is the evolution of the Trump-Russia collusion theory. Attorney General William Barr may well have decided that the nation does not need to go through such an ordeal again, but he did the next best thing by tapping John H. Durham to investigate what could well be the most nefarious political conspiracy in American history. Durham is Connecticut’s top federal prosecutor, an attorney with a reputation for toughness and a resume that includes investigations into high-level government corruption cases. Reports suggest that he has been on the job for some weeks already, and that is an indication of how seriously the matter is being taken by the attorney general.


[..] If Barr did not anticipate the possibility of criminal indictments or the need to subpoena former government officials – people like former FBI Director James Comey – he could have handed off the probe to Michael Horowitz, the DOJ’s inspector general. Horowitz, who is currently looking into the FBI’s application for a FISA warrant in 2016 and three subsequent extensions of that warrant, does not have the scope of authority to investigate the affair conclusively. Essentially, inspectors general could be described more as auditors than investigators. The Justice Department’s IG is expected to deliver his report sometime in June, and Durham may well use Horowitz’s findings in his own investigation. Unlike Horowitz, Durham can subpoena private citizens – including former government officials – as well as utilize the full range of prosecutorial tools.

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2 years wasted on fiction. And still not over.

The Disinformationists (Hopkins)

So, the election-meddling Putin-Nazi disinformationists are at it again! Oh yes, while Americans have been distracted by Russiagate, Obstructiongate, Redactiongate, or whatever it’s being called at this point, here in Europe, we are purportedly being bombarded with Russian “disinformation” aimed at fomenting confusion and chaos in advance of the upcoming EU elections, which are due to take place in less than two weeks. The New York Times reports that an entire “constellation” of social media accounts “linked to Russia and far-right groups” is disseminating extremist “disinformation,” “encouraging discord,” and “amplifying distrust in the centrist parties that have governed for decades.”

These accounts share some of the same “digital fingerprints,” and are engaging in “tactics” similar to the “tactics used in previous Russian attacks,” notably the Kremlin’s notorious mass-brainwashing of millions of defenseless African Americans with those deceptive anti-masturbation memes during the 2016 elections. Now, this is not just a bunch of nonsense dressed up with authoritative-sounding lingo. No, The Times spoke to “analysts” and “advocacy groups,” which informed them that certain websites in Italy “share the same signatures” as certain other websites sharing certain “pro-Kremlin views.” Moreover, two “political groups” in Germany used the same Internet service providers as those “Russian hackers” who attacked our democracy by stealing those Democratic Party emails that transformed Americans overnight into a nation of Trump-loving white supremacists!


That hasn’t happened here in Europe yet, but I’m not sure how much longer we can hold out against this relentless onslaught. According to an “analysis” concocted by some cloud-based cybersecurity firm and authoritatively cited by Politico, at this point, “more than half of Europeans might have seen some form of disinformation” spread by “Russians” on social media. They might have been exposed to “extremist views” and “amplified content” possibly produced by the far-right Alternative for Germany party, and even (God help them!) supporters of Brexit.

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Step by step we’re finding out just how enormously the Democrats have failed.

No “Do-Over” On Russia Probe: White House Tells Nadler To Pound Sand (ZH)

White House counsel Pat Cipollone wrote in a Wednesday letter to House Judiciary Chairman Jerrold Nadler (D-NY) that Congress doesn’t get a “do over” of special counsel Robert Mueller’s Russia investigation and others conducted by the Justice Department. Nadler has led recent efforts in the Democratic-controlled House to continue, which are set to include hearings with Mueller himself, along with key witnesses in his investigation. “Congressional investigations are intended to obtain information to aid in evaluating potential legislation, not to harass political opponents or to pursue an unauthorized ‘do-over’ of exhaustive law enforcement investigations conducted by the Department of Justice,” reads the 12-page letter laying out a legal argument for why Nadler is overstepping his bounds.


The letter goes on to say “As presently framed, the Committee’s inquiries transparently amount to little more than an attempt to duplicate – and supplant – law enforcement inquiries, and apparently to do so simply because the actual law enforcement investigations conducted by the Department of Justice did not reach a conclusion favored by some members of the Committee.” “This is not a proper legislative purpose,” writes Cipollone. “While the letter does not invoke executive privilege over any of the documents requested — and leaves the door open to a more narrow request from House Democrats — White House Press Secretary Sarah Sanders said last week that President Trump “has no other option than to make a protective assertion of executive privilege” over the full, unredacted Mueller report itself.”-Axios

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Oh, we’re going to find out who Robert Swan Mueller III is. I got a lot of flack for calling him a coward and a liar, but in reality he’s much worse than that. “Mueller kept four innocent people in jail for years to protect the informant status of Whitey Bulger..”

Barr’s Investigator John Durham Once Probed Mueller in a Shocking Case (S. Noble)

Connecticut U.S. Attorney John Durham was appointed to investigate the origins of the Russia-Trump probe. Apparently, he has been on the job for weeks. Durham is the perfect investigator for the job by all accounts and he had experience with Robert Mueller in the Whitey Bulger case. He did not side with Mueller and Mueller’s agents suffered the consequences of Mueller’s, some would say, corrupt leadership. Back in the late 1990s, there were “allegations that FBI informants James ‘Whitey’ Bulger and Stephen ‘The Rifleman’ Flemmi had corrupted their handlers. So, in 1999, Janet Reno appointed John Durham as Special Prosecutor and charged him with investigating FBI corruption in Boston.

As it turned out, FBI agents aided mass murderer, Whitey Bulger and hid his crimes. Bulger was a protected informant. Durham sent one agent involved to prison for 10 years. Then-US Attorney, Robert Mueller is probably the one who should have landed in the pen. He allowed four innocent men to be sent to prison for a murder he knew they didn’t commit. He did it to protect Bulger. One of the four men was in Florida at the time of the murder and could not have committed the murder. When Durham went through the documents. He found that the four men had actually been framed. Four people who were innocent were kept in jail for years in order to protect the status of Whitey Bulger as an FBI informant.

The Boston Globe wrote: “[Mike] Albano [former Parole Board Member who was threatened by two F.B.I. agents for considering parole for the men imprisoned for a crime they did not commit] was appalled that, later that same year, Mueller was appointed FBI director, because it was Mueller, first as an assistant US attorney then as the acting U.S. attorney in Boston, who wrote letters to the parole and pardons board throughout the 1980s opposing clemency for the four men framed by FBI lies. Of course, Mueller was also in that position while Whitey Bulger was helping the FBI cart off his criminal competitors even as he buried bodies in shallow graves along the Neponset…”

[..] Robert Mueller was knee-deep in this scandal, along with Andrew Weissman and the agent sent to prison, but because Reno gave him very limited authority, Durham was not able to prosecute Mueller, who was not in the FBI at the time. Mueller kept four innocent people in jail for years to protect the informant status of Whitey Bulger, a mass-murdering Boston mobster who ended up dying in California, and it ended up costing the government $100 million plus in civil judgments.

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Two separate issues: the emergency, and naming Huawei an “entity”, meaning it can’t buy US tech without government approval.

Trump Declares National Emergency Over IT Threats (BBC)

President Donald Trump has declared a national emergency to protect US computer networks from “foreign adversaries”. He signed an executive order which effectively bars US companies from using foreign telecoms believed to pose national security risks. The order does not name any company, but is believed to target Huawei. The Chinese tech giant said restricting its business in the US would only hurt American consumers and companies. Several countries, led by the US, have raised concerns in recent months that Huawei products could be used by China for surveillance, allegations the company has vehemently denied.

The US has been pressuring allies to shun Huawei in their next generation 5G mobile networks. In a separate development, the US commerce department added Huawei to its “entity list”, a move that bans the company from acquiring technology from US firms without government approval. The moves are likely to worsen tensions between the US and China, which had already escalated this week with tariff hikes in a trade war. Huawei has been at the epicentre of the US-China power struggle that has dominated global politics over the past year.


[..] Huawei consistently says that if the US bans Huawei from its networks, they are the ones to lose out, not Huawei. That is true. Even without the US market, Huawei is likely to control 40-60% of the networks around the world, industry analysts say. But what may hurt Huawei more is the US decision to put them on the “entity list” – effectively banning American suppliers from selling to the firm. Huawei may not need the US market, but it certainly needs the key components that it gets from the US.

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But Europe doesn’t.

US Blacklists Huawei (R.)

The Trump administration hit Chinese telecoms giant Huawei with severe sanctions on Wednesday, adding another incendiary element to the U.S.-China trade dispute just as Treasury Secretary Steven Mnuchin said he would visit China soon for more talks. The Commerce Department said it was adding Huawei Technologies Co Ltd and 70 affiliates to its “Entity List” – a move that bans the company from acquiring components and technology from U.S. firms without government approval.


Commerce Secretary Wilbur Ross said in a statement that President Donald Trump backed the decision to “prevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests.” Trump earlier in the day signed an executive order barring U.S. companies from using telecommunications equipment made by firms deemed to pose a national security risk. While the order did not specifically name any country or company, U.S. officials have previously labeled Huawei a “threat” and lobbied allies not to use Huawei network equipment in next-generation 5G networks.

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Privatization gone wild.

UK Labour To Renationalize Energy Network End Consumer ‘Rip-Off’ (G.)

Labour will announce plans on Thursday to seize back control of Britain’s energy network from private shareholders in an effort to fight climate change and end fuel poverty. Jeremy Corbyn and the shadow business secretary, Rebecca Long-Bailey, are expected to say that heat and electricity should be a human right for all and nationalisation of the network is key to decarbonising the economy. Under Labour’s plan, companies that control the UK’s £62bn energy infrastructure – the pipes and cables that supply homes and businesses with gas and electricity – would be taken back into state control soon after a Labour election win. This would include National Grid, and the network arms of Scottish Power and SSE, with the existing investors in those companies to be reimbursed with government bonds at a price determined by parliament.


Nationalisation of the energy networks forms a central part of Labour’s plans to address climate change, with the party arguing that the profits generated from the infrastructure should be invested in the green economy rather than given to shareholders in the form of dividends. Long-Bailey will say energy customers have been “ripped off” by the privatisation of the UK’s energy grid, with shareholders paid £13bn in dividends over the past five years. “It’s an insult and an injustice to our people and our planet for companies operating the grid to rip customers off, line the pockets of the rich and not invest properly in renewable energy,” she will say.

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Well well.

Majority Of Europeans Expect End Of EU Within 20 Years (G.)

More than half of Europeans believe the EU is likely to collapse within a generation, despite support for the bloc hitting heights not recorded in more than a quarter of a century. In France, Germany, Belgium, Italy, the Netherlands, Austria, Slovakia, Romania, Greece, the Czech Republic and Poland, a majority of people surveyed thought EU disintegration was a “realistic possibility” in the next 10 to 20 years. The figures are particularly stark in France, where President Emmanuel Macron’s La République En Marche party is trailing behind Marine Le Pen’s Brussels-bashing Rassemblement National (RN) in the polls for next week’s European elections.


According to the survey, commissioned by the European Council on Foreign Relations (ECFR) thinktank, 58% of people in France believe the EU is very likely or fairly likely to fall apart within 20 years, second only to Slovakia (66%). Of the 14 countries polled by YouGov – constituting 80% of the seats of the European parliament – it was only in Sweden (44%), Denmark (41%) and Spain (40%) that the proportion predicting implosion dipped below a majority. Nearly seven decades after the creation of the European Coal and Steel Community, bringing together France, Germany, Italy, Belgium, the Netherlands and Luxembourg in a pact designed to stave off further war, three in 10 people polled said conflict among countries within the EU was a realistic possibility. As many as a third of voters in France and Poland said they believed a war could be possible.

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Probably the worst thing I’ve read on the 727 MAX disasters.

If no Boeing executive goes to jail for this, you know something’s terribly wrong. And the media, in this case the BBC, helps them, but how do you “inadvertently” make an alarm feature “optional”?

Pilots ‘Raised Boeing Safety Fears’ Months Before Ethiopia Crash (BBC)

American Airlines pilots confronted Boeing about potential safety issues in its 737 Max planes in a meeting last November, US media are reporting. They urged swift action after the first deadly 737 Max crash off Indonesia in October, according to audio obtained by CBS and the New York Times. Boeing reportedly resisted their calls but promised a software fix. But this had not been rolled out when an Ethiopian Airlines’ 737 Max crashed four months later, killing 157 people. Currently 737 Max planes are grounded worldwide amid concerns that an anti-stall system may have contributed to both crashes. Boeing is in the process of updating the system, known as MCAS, but denies it was solely to blame for the disasters.

In a closed door meeting with Boeing executives last November, which was secretly recorded, American Airlines’ pilots can be heard expressing concerns about the safety of MCAS. Boeing vice-president Mike Sinnett told the pilots: “No one has yet to conclude that the sole cause of this was this function on the airplane.” Later in the meeting, he added: “The worst thing that can ever happen is a tragedy like this, and the even worse thing would be another one.” The pilots also complained they had not been told about MCAS, which was new to the 737 Max, until after the Lion Air crash off Indonesia, which killed 189. “These guys didn’t even know the damn system was on the airplane, nor did anybody else,” said Mike Michaelis, head of safety for the pilots’ union.


Earlier this month Boeing admitted that it knew about another problem with its 737 Max jets a year before the fatal accidents, but took no action. The firm said it had inadvertently made an alarm feature optional instead of standard, but insisted that this did not jeopardise flight safety. The feature – an Angle of Attack (AOA) Disagree alert – was designed to let pilots know when two different sensors were reporting conflicting data. The US Federal Aviation Administration said the issue was “low risk”, but said Boeing could have helped to “eliminate possible confusion” by letting it know earlier.

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I don’t think we’re going to help anyone by trying to turn everything into a climate change issue. Plastics are bad, period. Ban them in all but absolutely necessary cases. The carbon footprint of plastic is 0.5 Gt-CO2 per year, or about 1/80th (1.25%) of total emissions. Electricity is 25%, food is 24%.

I do like the link to US shale boosting plastics production, though, that helps people understand.

Single-Use Plastics A Serious Climate Change Hazard (G.)

The proliferation of single-use plastic around the world is accelerating climate change and should be urgently halted, a report warns. Plastic production is expanding worldwide, fuelled in part by the fracking boom in the US. The report says plastic contributes to greenhouse gas emissions at every stage of its lifecycle, from its production to its refining and the way it is managed as a waste product. This plastic binge threatens attempts to meet the Paris climate agreement. It means that by 2050 plastic will be responsible for up to 13% of the total “carbon budget” – equivalent to 615 coal-fired power plants – says the research published on Thursday.

The contribution of plastic production and disposal to climate change has been largely hidden, say the authors of the report by the Center for International Environmental Law, which estimates the greenhouse gas footprint of plastic from the cradle to the grave for the first time. While plastic pollution in the oceans has become a high-profile concern, the effect on climate change of the ubiquitous use of plastic has not been a focus. “After the extraction of fossil fuels to produce plastic, the carbon footprint of a material which has become ubiquitous across the globe continues through the refining process, and on well past its useful life as a drinks bottle or plastic bag, through the way it is disposed of and the plastic afterlife,” the report says. The authors say disposable plastic found in packaging and fast-moving consumer goods forms the largest and fastest-growing segment of the plastic economy.


Forty per cent of plastic packaging waste is disposed of at sanitary landfills, 14% goes to incineration facilities and 14% is collected for recycling. Incineration creates the most CO2 emissions among the plastic waste management methods. Nearly all plastic – 99% – is made from fossil fuels. Refining the material is the most greenhouse gas intensive part of the plastic lifecycle, and major expansions in the US and elsewhere will accelerate climate change, the report says. A Shell ethane cracker being constructed in Pennsylvania could emit up to 2.25m tonnes of CO2 each year and a new ethylene plant at ExxonMobil’s refinery in Baytown, Texas, could release up to 1.4m tonnes. The annual emissions from just these two new facilities would be equal to adding almost 800,000 cars to the road, the report says.

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Too many elephants, or too much land taken away from them? We should be paying Africans (not their governments) to take care of the wildlife. Stop dragging them around the world. This is not the 19th century.

Zimbabwe Sells 100 Elephants To China, Dubai (AFP)

Zimbabwe has sold nearly 100 elephants to China and Dubai for a total price of $2.7 million over six years, the country’s wildlife agency said Wednesday, citing overpopulation. Parks and Wildlife Management Authority spokesman Tinashe Farawo told AFP Zimbabwe’s elephants were overcrowding national parks, encroaching into human settlements, destroying crops and posing a risk to human life. “We have 84,000 elephants against a carrying capacity of 50,000,” he said, justifying the sales. “We believe in sustainable use of resources, so we sell a few elephants to take care of the rest. Farawo said 200 people have died in “human-and-animal conflict” in the past five years, “and at least 7,000 hectares of crop have been destroyed by elephants”.


The animals’ natural habitat has been depleted by climate change, he added, while recurrent droughts have added to strain on the overburdened national parks, forcing the pachyderms to seek food and water further afield. Farawo said money from the legal sales was allocated to anti-poaching projects, conservation work, research and welfare. According to the Zimbabwe Chronicle newspaper, 93 elephants were safely airlifted to parks in China and four to Dubai between 2012 and 2018, They were sold in a price range of between $13,500 and $41,500 each. Botswana, Namibia, Zambia and Zimbabwe have called for a global ban on elephant ivory trade to be relaxed due to the growing number of elephants in some regions. But over the past decade, the population of elephants across Africa has fallen by about 111,000 to 415,000, largely due to poaching for ivory, according to the International Union for Conservation of Nature (IUCN).

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Feb 252019
 


M. C. Escher Reptiles 1943

 

EU Explores Plans To Delay Brexit Until 2021 (G.)
May Delays ‘Meaningful’ Parliament Vote On Brexit Till March 12 (BBC)
Schiff Threatens To Call Mueller To Testify If Report Not Made Public (AP)
Trump To Delay China Tariff Hike After Trade Talks ‘Progress’ (AFP)
Global LNG Trade To Rise 11% This Year – Shell (R.)
Spain Surpasses Italy To Become “World’s Healthiest Country” (ZH)
African Union Seeks To Kill EU Plan To Process Migrants In Africa (G.)
One Million Tonnes Of Sludge To Be Dumped In Great Barrier Reef (BBC)
Concrete: The Most Destructive Material On Earth (G.)
Dearth Of Worms Blamed For Dramatic Decline In UK Songbird Population (Ind.)
Poachers Kill Elephant In Cambodia Wildlife Sanctuary (AFP)
Dozens Of Dead Elephants Discovered In Poaching Hot Spots In Botswana (BBC)

 

 

May is likely to ask for a few months’ delay, but Brussels won’t have that.

EU Explores Plans To Delay Brexit Until 2021 (G.)

Brexit could be delayed until 2021 under plans being explored by the EU’s most senior officials, at a time of growing exasperation over Theresa May’s handling of the talks, the Guardian can reveal. A lengthy extension of the negotiating period is gaining traction as the EU’s default position should the Commons continue to reject May’s deal, and a request emerge. Replacing the 21-month transition period with extra time as a member state would allow the UK and the EU to develop their plans for the future relationship with the aim of making the contentious Irish backstop redundant. Brussels is determined to avoid offering a short extension only to have to revisit the issue in the summer when the government again fails to win round parliament.

“If leaders see any purpose in extending, which is not a certainty given the situation in the UK, they will not do a rolling cliff-edge but go long to ensure a decent period to solve the outstanding issues or batten down the hatches,” one EU diplomat said. “A 21-month extension makes sense as it would cover the multi-financial framework [the EU’s budget period] and make things easier. Provided leaders are not completely down with Brexit fatigue, and a three-month technical extension won’t cut it, I would expect a 21-month kick [of the can]. It is doing the rounds in Brussels corridors. Martin Selmayr [the European commission’s secretary-general], among others, also fond of the idea.”

Exasperation with May’s handling of Brexit is growing in Brussels as senior insiders put the chance of the UK crashing out without a deal at “more than 50%”. Informed sources say there is dismay that senior government figures are focused on seeking domestic political advantage and appear wilfully blind to the opposition to reopening the withdrawal agreement. [..] There is also bewilderment that the recent flurry of meetings in Brussels involving May’s Brexit secretary, Stephen Barclay, and the attorney general, Geoffrey Cox, are being characterised in London as “negotiations” when the reality is the EU is still waiting for the prime minister to show them the alternative arrangements for the Irish backstop for which she claims to have a majority in support.

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Why is May not in London, but in Egypt with the EU she wants to leave in a month and change? Arms deals?

May Delays ‘Meaningful’ Parliament Vote On Brexit Till March 12 (BBC)

MPs will be able to have a fresh vote on the Brexit deal by 12 March, Prime Minister Theresa May has said. Speaking as she travelled to an EU-Arab League summit in Egypt, Mrs May ruled out holding another so-called “meaningful vote” this week. But she said “positive” talks with the EU were “still ongoing” and leaving on 29 March was “within our grasp”. Labour leader Jeremy Corbyn accused the prime minister of “recklessly running down the clock”. In a tweet, he said the move was intended to “force MPs to choose between her bad deal and a disastrous no deal”.

Labour, he said, would “work with MPs across the Commons to prevent no deal, break the deadlock and build support for our alternative plan”. On the plane to Sharm el-Sheikh for a summit between EU and Arab league leaders, Mrs May said her team would be returning to the Belgian capital on Tuesday for further talks. “As a result of that, we won’t bring a meaningful vote to Parliament this week, but we will ensure that that happens by 12 March,” she added.

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He wants No Collusion fully documented. Oh, wait, no, he wants to see if there are any scraps left that can serve to divert attention from the fact that there’s No Collusion.

Schiff Threatens To Call Mueller To Testify If Report Not Made Public (AP)

A top Democrat threatened on Sunday to call special counsel Robert Mueller to testify on Capitol Hill, subpoena documents and take the Trump administration to court if necessary, if the full report on the Russia investigation is not made public. House intelligence committee chair Adam Schiff told ABC’s This Week his committee will be watching Attorney General William Barr to see if he were “to try to bury any part of this report”. There will be intense scrutiny and pressure on Barr, he said, to fully release the report. “We will take it to court if necessary,” Schiff said. “If he were to try to withhold, to try to bury any part of this report, that will be his legacy and it will be a tarnished legacy.

So I think there’ll be immense pressure not only on the department, but on the attorney general to be forthcoming.” Schiff is not alone in calling for the report to be made public, or in promising aggressive investigations by Democrat-controlled committees. He himself has made such calls. But the pressure is mounting as Mueller is showing signs of wrapping up his nearly two-year-old investigation into possible coordination between Trump associates and Russian efforts to sway the 2016 election. Barr, who oversees the investigation, has said he wants to release as much information as he can. But during his confirmation hearing last month, he also made clear that he ultimately will decide what the public sees and that any report will be in his words, not Mueller’s.

On Sunday, Schiff suggested that anything short of Mueller’s full report will not be enough to satisfy Democrats. He pointed to a public interest in seeing some of the underlying evidence, such as information gathered from searches conducted on longtime Trump adviser Roger Stone and Paul Manafort, a former Trump campaign chairman. Schiff has said his committee planned to expand its own investigations by examining, for instance, whether foreign governments have leverage over Trump, his relatives or associates.

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From negotiations to dancing.

Trump To Delay China Tariff Hike After Trade Talks ‘Progress’ (AFP)

US President Donald Trump has vowed to delay a planned tariff increase on Chinese exports after both sides hailed “substantial progress” in trade talks, raising the prospect of a summit with President Xi Jinping to seal the deal. Trump said Sunday there could be “very big news” in the next two weeks, and he planned to meet with Xi at the US leader’s Mar-a-Lago resort in Florida if more progress is made. Top negotiators met in Washington for four days of talks that ended on Sunday in an effort to resolve a months-long trade war that analysts feared could torpedo the global economy.

The United States had been due to increase tariffs on more than $200 billion in Chinese goods on March 1, but Trump said he would now delay the punitive duties following the “very productive talks”. “I am pleased to report that the U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues,” Trump wrote on Twitter. The official Xinhua news agency used almost the exact same language, reporting “substantial progress” on those thorny issues in the talks led by Xi’s top trade negotiator, Vice Premier Liu He.

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Warning: someone will try to sell this to you as a positive for green.

Global LNG Trade To Rise 11% This Year – Shell (R.)

Global liquefied natural gas (LNG) trade will rise 11 percent to 354 million tonnes this year as new facilities increase supplies to Europe and Asia, Royal Dutch Shell said in an annual LNG report on Monday. Shell, the largest buyer and seller of LNG in the world, said trade rose by 27 million tonnes last year, with Chinese demand growth accounting for 16 million tonnes of those volumes. Shell’s forecasts, which see LNG demand climbing to 384 million tonnes next year, reflect a burgeoning industry with new production facilities opening in Australia, the United States and Russia and more countries becoming importers by constructing receiving terminals. Asia dominates the market with Japan remaining the top buyer.

China became the second largest in 2017 as demand soared due to a government-mandated push for power stations to switch from coal to cleaner-burning gas to help reduce pollution. Due to the uneven progress of developing liquefaction-export facilities on the one hand and regasification-import terminals on the other, many analysts see the global market becoming oversupplied if not this year then next year. But most also see a supply crunch around the mid-2020s because, at the moment, there are not enough liquefaction facilities being planned, financed and built. Such projects are underpinned by long-term supply contracts struck years in advance by their operators. Between 2014 and 2017 buyers were signing shorter-duration contracts for smaller volumes, making financing difficult to complete.

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Actually, it’s perhaps mostly about primary care.

Spain Surpasses Italy To Become “World’s Healthiest Country” (ZH)

As the US struggles with declining life expectancy (as deaths from suicides, drug overdoses and other “deaths of despair” climb), rising infant mortality and ballooning health-care costs that preclude access to preventative care for millions of Americans – not to mention the attendant ills of rampant obesity and tobacco use), America has seen its position among the world’s healthiest nations deteriorate, while, across the Atlantic, more European nations are claiming spots in the highest echelons of the global rankings. According to Bloomberg’s 2019 World Health Rankings, Spain has supplanted Italy as the world’s healthiest country. In the most ranking, published in 2017, Spain had placed sixth.

Four other European nations ranked among the top 10 in 2019: Iceland (third place), Switzerland (fifth), Sweden (sixth) and Norway (ninth). Japan was the healthiest Asian nation, climbing three ranks to place fourth overall, and supplanting Singapore, which dropped to eighth. Rounding out the top ten were Australia and Israel, which ranked seventh and 10th, respectively. Variables including life expectancy are used to rank countries, while factors like tobacco use and obesity work against the overall ranking. Environmental factors like access to clean water and sanitation are also taken into consideration. Spain has the highest life expectancy at birth among EU nations. Out of all 169 nations that BBG tracks, only Japan and Switzerland rank higher. By 2040, Spain is forecast to have the highest lifespan, at roughly 86 years, followed by Japan, Singapore and Switzerland.

The reason? Access to primary care. “Primary care is essentially provided by public providers, specialized family doctors and staff nurses, who provide preventive services to children, women and elderly patients, and acute and chronic care,” according to the European Observatory on Health Systems and Policies 2018 review of Spain. Over the past decade, this has helped bring about a decline in deaths from heart disease and cancer. While China ranked 52nd overall, it’s on track to surpass the US by 2040, according to the Institute for health metrics and evaluation.

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“When the EU wants something, it usually gets it..”

African Union Seeks To Kill EU Plan To Process Migrants In Africa (G.)

The African Union is seeking to kill off the EU’s latest blueprint for stemming migration, claiming that it would breach international law by establishing “de facto detention centres” on African soil, trampling over the rights of those being held. A “common African position paper” leaked to the Guardian reveals the determination of the 55-member state body, currently headed by Egypt, to dissuade any of its coastal states from cooperating with Brussels on the plan. The EU set plans for “regional disembarkation platforms” in motion last summer to allow migrants found in European waters to have their asylum requests processed on African soil.

Brussels has a similar arrangement in place with Libya, where there are 800,000 migrants, 20,000 of whom are being held in government detention centres. The Libyan authorities have been accused of multiple and grave human rights abuses. A UN report recently stated that migrants in the country faced “unimaginable horrors”. Some northern states, including Morocco, have already rejected the EU’s proposal over the new “platforms”, but there are concerns within the African Union (AU) that other member governments could be persuaded by the offer of development funds.

Italy’s far-right interior minister Matteo Salvini has called for the centres to be based around the Sahel region, in Niger, Chad, Mali and Sudan. An inaugural summit between the EU and the League of Arab States is being held in Sharm el-Sheikh in Egypt on Sunday and Monday, and migration is expected to be discussed. “When the EU wants something, it usually gets it,” said a senior AU official. “African capitals worry that this plan will see the establishment of something like modern-day slave markets, with the ‘best’ Africans being allowed into Europe and the rest tossed back – and it is not far from the truth.”

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I’m sure this means Australia is going for some kind of award. Just don’t know which one.

One Million Tonnes Of Sludge To Be Dumped In Great Barrier Reef (BBC)

Australia plans to dump one million tonnes of sludge in the Great Barrier Reef. Despite strict laws on dumping waste, the Great Barrier Reef Marine Park Authority (GBRMPA) gave the go-ahead. A loophole was found – the laws don’t apply to materials generated from port maintenance work. It comes one week after flood water from Queensland spread into the reef, which scientists say will “smother” the coral. The industrial residue is dredged from the bottom of the sea floor near Hay Point Port – one of the world’s largest coal exports and a substantial economic source for the country. Larissa Waters, senator for Queensland and co-deputy leader of the Greens Party, called for the license to be revoked.

“The last thing the reef needs is more sludge dumped on it, after being slammed by the floods recently,” she told the Guardian. “One million tonnes of dumping dredged sludge into world heritage waters treats our reef like a rubbish tip.” It’s just “another nail in the coffin” for the World Heritage-listed Great Barrier Reef, which is already under stress due to climate change, according to Dr Simon Boxall from the National Oceanography Centre Southampton. “If they are dumping it over the coral reef itself, it will have quite a devastating effect. The sludge is basically blanketing over the coral. “The coral relies on the algae, that’s what give them their colour and what helps them feed – without this partnership the coral will suffer dramatically.”

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“..we may have already passed the point where concrete outweighs the combined carbon mass of every tree, bush and shrub on the planet. ”

Concrete: The Most Destructive Material On Earth (G.)

In the time it takes you to read this sentence, the global building industry will have poured more than 19,000 bathtubs of concrete. By the time you are halfway through this article, the volume would fill the Albert Hall and spill out into Hyde Park. In a day it would be almost the size of China’s Three Gorges Dam. In a single year, there is enough to patio over every hill, dale, nook and cranny in England. After water, concrete is the most widely used substance on Earth. If the cement industry were a country, it would be the third largest carbon dioxide emitter in the world with around 2.8bn tonnes, surpassed only by China and the US.

The material is the foundation of modern development, putting roofs over the heads of billions, fortifying our defences against natural disaster and providing a structure for healthcare, education, transport, energy and industry. Concrete is how we try to tame nature. Our slabs protect us from the elements. They keep the rain from our heads, the cold from our bones and the mud from our feet. But they also entomb vast tracts of fertile soil, constipate rivers, choke habitats and – acting as a rock-hard second skin – desensitise us from what is happening outside our urban fortresses. Our blue and green world is becoming greyer by the second. By one calculation, we may have already passed the point where concrete outweighs the combined carbon mass of every tree, bush and shrub on the planet.

Our built environment is, in these terms, outgrowing the natural one. Unlike the natural world, however, it does not actually grow. Instead, its chief quality is to harden and then degrade, extremely slowly. All the plastic produced over the past 60 years amounts to 8bn tonnes. The concrete industry pumps out more than that every two years. But though the problem is bigger than plastic, it is generally seen as less severe. Concrete is not derived from fossil fuels. It is not being found in the stomachs of whales and seagulls. Doctors aren’t discovering traces of it in our blood. Nor do we see it tangled in oak trees or contributing to subterranean fatbergs. We know where we are with concrete. Or to be more precise, we know where it is going: nowhere. Which is exactly why we have come to rely on it.

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For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the message was lost.
For want of a message the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail.

Dearth Of Worms Blamed For Dramatic Decline In UK Songbird Population (Ind.)

Britain’s first farmland worm survey has revealed that nearly half of English fields lack key types of earthworm and may help explain the alarming decline of one of the country’s most loved songbirds. The citizen science project, in which farmers dug for worms in their own fields, has prompted 57 per cent of them to pledge to change their soil management practices – a move that may benefit the song thrush, for whom worms are a vital food source. The English population of the song thrush, popular for both its voice and its habit of using stones as an “anvil” to smash the shells of its other favourite food – snails – declined by more than 50 per cent between 1970 and 1995, leading to it being listed as a species of conservation concern.

The #60minworms survey, led by Dr Jackie Stroud, a Natural Environment Research Council (Nerc) soil security fellow at the Rothamsted Research centre, adds to the evidence that the song thrush is being affected by a reduction in farmland earthworm populations, along with the loss of hedgerow nesting sites. In a statement about the survey, Rothamsted Research said: “The results indicate widespread, historical over-cultivation, and may explain observed declines in other wildlife, such as the song thrush, that feed on these worms.” Stressing the importance of earthworms, Dr Stroud added: “Earthworms play vital roles in plant productivity and are great bird food as well. They are really important in our soil systems. “They influence carbon cycling, water infiltration, pesticide movement, greenhouse gas emissions, plant productivity, the breeding success of birds and even the susceptibility of plants to insect attack.

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Stop any and all trade with any and all countries where animal parts are traded.

Poachers Kill Elephant In Cambodia Wildlife Sanctuary (AFP)

An elephant has been found dead with its tusks and tail sliced off in a wildlife sanctuary in Cambodia, where wild elephant numbers have dwindled to just a few hundred due to poaching and deforestation. The Southeast Asian nation has emerged in recent years as a key transit hub for the multi-billion dollar illicit wildlife trade, with demand for products made from tusks, pangolin scales and rhino horns high in China and neighbouring Vietnam. According to the Mondulkiri Project, an animal rescue NGO, there are about 400 elephants in the wild in Cambodia, and about 50 held in captivity.

The body of the male Asian elephant was found on Sunday in a wildlife sanctuary in northeastern Mondulkiri province, said Environment Ministry spokesman Neth Pheaktra. “The elephant’s tusks were missing and its tail was also cut off,” he told AFP on Monday, adding the animal was killed about 10 days ago. “There was a wound from a gunshot under its right eye,” Neth Pheaktra said, adding authorities are still hunting for the poachers. A baby elephant was found dead last year in the same sanctuary when it was caught in a trap set by poachers, he said. The Asian elephant is hunted for its precious tusks, while its tail hair is considered lucky and embedded in rings and bracelets.


The body of a male Asian elephant was found in a wildlife sanctuary in northeastern Cambodia on Sunday (AFP Photo/Handout)

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“..Tanzania lost 60% of its elephant population in five years..”

Dozens Of Dead Elephants Discovered In Poaching Hot Spots In Botswana (BBC)

One of the last elephant sanctuaries in Africa has “a significant elephant-poaching problem”, according to the final results of an aerial wildlife survey in Botswana seen by the BBC. Elephants Without Borders, which conducted the four-yearly survey with the government, said there was a six-fold increase in the number of “fresh” or “recent” elephant carcasses in northern Botswana amid “obvious signs” of poaching. Mike Chase, the scientist who carried out the survey, sparked a fierce debate in the country when he went public half-way through his study in August last year with accusations there was a poaching problem and alleging the authorities were ignoring him. He told the BBC at the time that while flying over northern Botswana, he had discovered 87 recently killed elephants in one “hotspot” area – a number now revised to 88 – and 128 overall.

The government called his figures “false and misleading” and criticised “unsubstantiated and sensational media reports”. He received death threats and has since had one of his two research licences suspended by the government. President Mokgweetsi Masisi at the time described the allegations as the “biggest hoax of the 21st Century” and denied there had been a spike in poaching in the country. But the final report identifies four poaching hotspots, provides photographic evidence from ground surveys and has been peer-reviewed by nine international elephant experts. “The response from… various people was to try and deny or whitewash – label me a traitor and a liar – without having actually verified the evidence we bore witness to,” said Mr Chase.

Botswana is home to 130,000 elephants – a third of the total number in Africa – and it is an obvious target for poachers. Even when extrapolating poaching figures from the sample found in the survey, the numbers killed will not have a major impact on such a large population. “If we are talking about a number of carcasses that have accumulated over a period of two years, given the population of elephants in Botswana it doesn’t really raise eyebrows,” said national parks director Mr Tiroyamodimo. This was not satisfactory for Mr Chase. “At what point do we say we have a problem?” he asked.

“Is it at 10? 50? 100? 150? 1,000? Lessons have taught us – when we look at Tanzania that lost 60% of its elephant population in five years – that’s how quickly poaching can settle into a population. “We saw with our own eyes 157 confirmed poached elephants. We estimate that the total poached in the last year is at least 385 and probably far more because that is based on what we actually saw and have not had time or finances to visit all carcasses on the ground.”

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Aug 142017
 
 August 14, 2017  Posted by at 8:59 am Finance Tagged with: , , , , , , ,  


August Strindberg Alpine Landscape I 1894

 

Multiple Contraction : Stock Market Warning Siren is Blaring (WS)
Is The Euro Crisis Really Over? (Lacalle)
US Is The Real Trade Protectionist – China State Media (CNBC)
Fourth Turning: “It’s Going To Be A Rollercoaster Ride” (ZH)
Conspiracy or Chaos? (Jim Quinn)
Forget GDP – There’s More To Britain’s Wealth Than Its Bank Balance (Baggini)
Factory Farming, Antibiotics Use In Asia Creating Global Health Risks (G.)
More NGOs Follow MSF In Suspending Mediterranean Migrant Rescues (R.)
Syrian Refugees Can Return To Aleppo… And Do So In Their 100,000s (RT)
Do Elephants Have Souls? (NA)

 

 

Creative accounting is subject to inherent limits.

Multiple Contraction : Stock Market Warning Siren is Blaring (WS)

“Adjusted” earnings growth is 10.2% year-over-year in the second quarter, according to FactSet, based on the 91% of the companies in the S&P 500 that have reported results. The energy sector was a key driver, with 332% “adjusted” earnings growth from the oil-bust levels of a year ago. The sectors with double-digit earnings growth: information technology (14.7%), utilities (10.8%), and financials (10.3%). The rest were single digit. Earnings in the consumer discretionary sector declined. Revenues grew 5.1%, also led by the energy sector. At the beginning of Q2 last year, the WTI grade of crude oil traded at $35 a barrel. In Q2 this year, WTI ranged from $42 to $53 a barrel.

So the Wall-Street hype machine is cranking at maximum RPM to propagate the great news that earnings are soaring, and that this is the reason why stocks should also be soaring, and forget everything else. The hype machine carefully avoids showing the bigger picture which is dismal for earnings and ludicrous for stock valuations. Aggregate earnings per share (EPS) for the S&P 500 companies on a trailing 12-months basis rose for the second quarter in a row. That’s the foundation of the Wall Street hype. But here’s the thing with these EPS: they’re now back where they had been in… May 2014. Yep. More than three years of earnings stagnation. No growth whatsoever, even for “adjusted” earnings. In fact, on a trailing 12-month basis, aggregate EPS of the S&P 500 companies are down about 5% from their peak in Q4 2014.

And yet, over the same three-plus years of total earnings stagnation, the S&P 500 index has soared 34%. This chart shows those “adjusted” earnings per share for the S&P 500 companies (black line) and the S&P 500 index (blue line). I marked August 2012 as the point five years ago, and May 2014. And these are not earnings under the Generally Accepted Accounting Principles (GAAP). FactSet uses “adjusted” earnings for its analyses. These are the earnings with the bad stuff “adjusted” out of them by management to manipulate earnings into the most favorable light. Not all companies report “adjusted” earnings. Some only report GAAP earnings and live with the consequences. But others put adjusted earnings into the foreground, and that’s what Wall Street dishes up.

[..] This is the peculiar situation of today: On average, these companies have stagnating earnings per share propped up by “adjusting” these earnings and by financial engineering. The price-earnings multiple (P/E ratio) for stagnating companies should be low. In January 2012, the P/E ratio for the companies in the S&P 500 index was 14.9. And that was high. As of Friday, the aggregate P/E ratio is 24.3:

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Brussels keeps Europe from recovering. A continent of zombies.

Is The Euro Crisis Really Over? (Lacalle)

This week we have read that Brussels has certified “the end of the crisis”. In an uncomfortably triumphant statement, the group welcomed the fact that Europe had emerged from the crisis and returned to growth “thanks to the decisive action of the European Union”. Really? Thanks to the “decisive action” of the European Union the “economy is back in shape”? It is true that the communique says that “much remains to be done to overcome the legacy of the crisis years”, but if we can say something about the European crisis is that the “decisive” action of the European Union has not helped to end the crisis, but has perpetuated and silenced it. The European economy is not “in shape”.

According to the Bank of International Settlements and Merrill Lynch, Europe has more zombie companies today than before the crisis, 9% of large listed non-financial corporations are considered walking dead, ie generating operating profits that do not cover their financial costs, in spite of all-time low-interest rates and an unprecedented monetary stimulus. And that is among the big companies, where the business results of the Eurostoxx remain below 2008. If we go to SMEs, the European Union has higher rates of bankruptcies and losses than in 2008, yet the tax burden on companies has increased. In fact, if anything can be said of the European business fabric is that it has been devastated by taxes.

The European Union has continued to hamper the high-productivity sectors to support the so-called national champions and zombies, that large amount of low-value added conglomerates, ridden by high debt and poor margins. While the United States saw the astronomical takeoff of technology giants and corporate profits growing at double digit rates, the EU decided to put obstacles to growth, and today, in the Eurostoxx 100, we have the same collection of dinosaurs that we had a decade ago. European banks, at the end of 2016, had more than €1 trillion in non-performing loans, a figure that represents 5.1% of total loans compared to 1.5% in the US or Japan. Europe has gone from financial crisis to financial crisis, and recently we have had new episodes in Italy, Spain and Portugal.

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Theory: Xi will not put up a real fight if he’s not certain he can win (Deng Xiao Ping’s stance on US).

US Is The Real Trade Protectionist – China State Media (CNBC)

Trump is expected to issue the so-called Section 301 investigation under the 1974 Trade Act later on Monday to investigate Chinese trade practices that force U.S. firms operating in China to turn over intellectual property, multiple outlets reported. China will retaliate in such a case, said the Communist Party-linked Global Times, which is known for its nationalist slant. “The Trump administration should have second thoughts about putting pressure on China on trade and avoid a full-blown trade war,” said the newspaper, adding that the Beijing “should make use of the WTO mechanism to sue the U.S. for trade protectionism.” “The trade policies of the Trump administration have been widely criticized. Although filing a lawsuit with the WTO is time-consuming, it is highly likely that China would win,” it said.

The latest news about a U.S. probe into Chinese trade practices could lead to steep tariffs and comes as Trump is pressing for China’s cooperation in reining in North Korea’s nuclear program. “The U.S. now is walking softly and carrying a huge stick in regards to what it wants. Here, this is tactically nothing more than ‘We need your support with North Korea,’ part and parcel, that’s it. The symbolism of this is just politics and game play,” Frank Troise, managing director at SoHo Capital, told CNBC’s “The Rundown.” China has repeatedly said the two issues were not related, with the Global Times calling the link “illogical” in its Sunday night editorial. Commentaries in state media normally provide insight into government thinking beyond typically thin official statements.

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Neil Howe is an interesting voice, and that’s only partly because Steve Bannon likes his work.

Fourth Turning: “It’s Going To Be A Rollercoaster Ride” (ZH)

[..] .. although 9/11 changed America’s attitude towards the rest of the world, I think that the stock market boom and celebrity circus that’s here in the United States really hadn’t changed very much. And I don’t think you really had a shift, a fundamental shift, in America’s perception of themselves as a people, as their own country, to a fundamental degree until 2008. Also, 2001, as we explained to many people at the time, was simply too early. Every turning starts when each generation is beginning to move into a new phase of life. Back in 2001 boomers were not yet retiring, millennials were still—maybe the first one of them was barely graduating from high school.

So, this was not what we expected. 2008 really did coincide with the generational maturity of the turning, so to speak. And I think that, in terms of the basic shift in our efficacy of the social system, I think 2008 was a bigger change.” The crisis also ushered in an era where central banks exhibit total control of markets, which has created an “artificial quality,” Howe said. “The economic emergency that occurred in 2008-2009 really catapulted us into by far the biggest economic emergency we’ve been in since the early 1930s. And, arguably, we are still living out the consequences of that with complete change in central bank policy, monetary policy, with sustaining these record low interest rates and arguable very high valuations in financial markets—almost anything pushed by that—and people still wondering how we’re going to get out from under that.

The constant discussion is when are central banks going to pull back on their balance sheets and actually go back to the old normal? So, I think there is the sense, even in this the booming markets that we see today, that there is this artificial quality: people think that there’s something wrong about this. We have not re-righted where we were. We are not letting price discovery and actual markets function the way they did before then. So, I do believe that 2008 was the beginning of a whole new regime. And I also believe that the political dysfunction, the sense of political dysfunction—created during the two turns of the Obama presidency and, obviously, also into the Trump presidency—of government completely grinding to a halt is going to have some very powerful repercussions in the years shortly to come.”

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Anarchy in the UK.

Conspiracy or Chaos? (Jim Quinn)

Alan Moore, the renowned graphic novel writer, and author of the dystopian classic V for Vendetta, politically identifies as an anarchist. His view that all political states are an outgrowth of anarchy, with the biggest gang taking control and dictating how things will be run, is manifested in V for Vendetta. As an anarchist, you can understand why he is doubtful of conspiracy theories and an all-powerful entity controlling the world. He believes in a chaotic world competing gangs position themselves to gain power and control.

“We live in a badly developed anarchist situation in which the biggest gang has taken over and have declared that it is not an anarchist situation – that it is a capitalist or a communist situation. But I tend to think that anarchy is the most natural form of politics for a human being to actually practice.”- Alan Moore

The Guy Fawkes mask from V for Vendetta has been adopted by anarchist groups around the world, including: Anonymous, WikiLeaks, and the Occupy protestors. Moore’s positive view of the Occupy movement was based on his belief ordinary people had the right to reclaim what had been taken from them by criminal bankers. The initial impetus for the Occupy protests was the destruction of Main Street USA by Wall Street sociopaths, who not only escaped prosecution for their crimes, but were bailed out by the taxpayers they had pillaged and further enriched as captured politicians enabled them to get even bigger. Millions were evicted from their homes and lost their jobs. Middle class families have seen their real income continue to stagnate, while bankers, corporate executives, and politicians have reaped billions in bonuses, stock gains, and payoffs, provided by central bankers in their back pocket.

“I can’t think of any reason why as a population we should be expected to stand by and see a gross reduction in the living standards of ourselves and our kids, possibly for generations, when the people who have got us into this have been rewarded for it – they’ve certainly not been punished in any way because they’re too big to fail. I think that the Occupy movement is, in one sense, the public saying that they should be the ones to decide who’s too big to fail. As an anarchist, I believe that power should be given to the people whose lives this is actually affecting.” – Alan Moore

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Basic argument: technological growth beats economic growth. But why argue this using social housing and libraries?

Forget GDP – There’s More To Britain’s Wealth Than Its Bank Balance (Baggini)

How is this possible? Because “a lot of improvements in standard of living come not through what we normally consider as growth, but through technological improvements”. This is a concrete example of real growth without what is normally understood by economic growth. If we can grasp this, we can see why the argument about whether indefinite growth is environmentally sustainable is bogus. Orthodox economics says that it is essential if the world’s worst-off are to escape their poverty. Critics argue for zero or even negative growth, claiming that this is the only way to ensure we don’t deplete the planet’s resources. Both are wrong. Real wealth is created not just by exploiting more resources and increasing society’s cash pot but by exploiting the same or fewer resources better.

The whole question of GDP growth is a red herring if we are interested in real wealth. What matters is that we do more with the resources we have. Building a better future depends on seeing this clearly. Take the need to reduce inequality, which many now accept is urgent. To do this it is assumed we need to reduce the income gap between rich and poor. But real equality is increased simply by making it possible for the less well-off to do more with the money they have. Social housing was, and could again be, an example of that. Take two people, one of whom earns £30k a year and the other £15k. To close the real wealth gap between the two does not necessarily require increasing the income of the latter. Providing them with a decent council flat at low rent effectively allows their disposable income to equalise.

The basic principle here is that what matters most is giving people the resources they need to live better, which doesn’t necessarily require giving them more cash. This has in effect been the principle behind all sorts of socially levelling initiatives. Local authorities didn’t give local people free books, they gave them the use of libraries. They didn’t give them cars, they gave them bus passes. We need to relearn the wisdom of these policies, and update them for the modern age. In an era where car ownership is not rare, what about low-cost car clubs? Why shouldn’t more people be able to borrow laptops and tablets from libraries as well as books and DVDs?

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“Half of all antibiotics globally are now consumed in China alone.”

Factory Farming, Antibiotics Use In Asia Creating Global Health Risks (G.)

The use of antibiotics in factory farms in Asia is set to more than double in just over a decade, with potentially damaging effects on antibiotic resistance around the world. Factory farming of poultry in Asia is also increasing the threat of bird flu spreading beyond the region, with more deadly strains taking hold, according to a new report from a network of financial investors. Use of antibiotics in poultry and pig farms will increase by more than 120% in Asiaby 2030, based on current trends. Half of all antibiotics globally are now consumed in China alone. The Chinese meat and animal feed producers New Hope Group and Wen’s Group are now among the 10 biggest animal feed manufacturers in the world. The growth of Asian meat production in intensive units is also producing a rise in greenhouse gas emissions from the food chain, with emissions likely to rise by more than 360m tonnes, the equivalent of running 100 coal-fired power plants for a year.

There are knock-on impacts such as deforestation, as China’s need for animal feed is responsible for more than a third of Brazil’s soybean production. The report, Factory Farming in Asia: Assessing Investment Risks, comes three years after a meat scandal in China, in which suppliers to McDonalds, KFC and others were found to be using dirty meat and products past their sell-by date. It also comes in the midst of a growing food scandal in Europe, which has required the recall of millions of eggs tainted with harmful chemicals, and as concerns have been aired over the impact of Brexit on imports of farm products to the UK. Asian food companies have rapidly expanded their meat production in response to growing populations and the tastes of the rising middle class, but this expansion has come to the detriment of food safety.

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They’re being shot at. And the Italian Foreign Minister calls that “a welcome readjustment” and a “positive process”.

More NGOs Follow MSF In Suspending Mediterranean Migrant Rescues (R.)

Two more aid groups have suspended migrant rescues in the Mediterranean, joining Doctors Without Borders, because they felt threatened by the Libyan coastguard. Save the Children and Germany’s Sea Eye said on Sunday their crews could no longer work safely because of the hostile stance of the Libyan authorities. Doctors Without Borders – or Medecins sans Frontieres – cited the same concern when it said on Saturday it would halt Mediterranean operations. “We leave a deadly gap in the Mediterranean,” Sea Eye’s founder Michael Busch Heuer warned on Facebook, adding that Libya had issued an “explicit threat” against non-government organisations operating in the area around its coast. Libyan coastguard boats have repeatedly clashed with NGO vessels on the edge of Libyan waters, sometimes opening fire.

The coastguard has defended such actions, saying the shooting was to assert control over rescue operations. “In general, we do not reject (NGO) presence, but we demand from them more cooperation with the state of Libya … they should show more respect to the Libyan sovereignty,” coastguard spokesman Ayoub Qassem told Reuters on Sunday. Tension has also been growing for weeks between aid groups and the Italian government, which has suggested some NGOs are facilitating people smuggling, while Italy is trying to enhance the role of the Libyan coastguard in blocking migrant departures. This month, Italy began a naval mission in Libyan waters to provide technical and operational support to its coastguard, despite opposition from factions in eastern Libya that oppose the U.N.-backed government based in Tripoli.

[..] Italian Foreign Minister Angelino Alfano said in a newspaper interview on Sunday that Libya’s growing role in controlling its waters was curbing people trafficking and producing a welcome “readjustment” in the Mediterranean. MSF’s decision to halt its rescue operations was part of this positive process, he told the newspaper La Stampa.

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There’s propaganda and then there’s reality. You decide who you believe.

Syrian Refugees Can Return To Aleppo… And Do So In Their 100,000s (RT)

Aleppo, a city retaken by Damascus from rebels in December last year, has become a major destination for displaced Syrian returning home in 2017 as numbers of returnees to Syria spills over 600,000, according to the UN. Over the first seven months of 2017, over 600,000 displaced Syrians returned home, the International Organization for Migration (IOM) said Friday, citing its own figures as well as those of the UN Migration Agency and partners on the ground. The returnees are overwhelmingly internally-displaced people, but 16% returned to Syria from other nations, primarily Turkey. The number almost matched that recorded in the whole of 2016. An estimated 67% of returnees went to government-controlled Aleppo Governorate, with the provincial capital itself being the primary destination.

Among other places where refugees went in significant numbers, according to ICO, is Al-Hasakah Governorate, the north-eastern province dominated by Kurds. The city of Aleppo – the largest in Syria prior to the conflict – was retaken by the government army last year, aided by Russia, with hostilities ending in mid-December. For years before that, it was divided between two parts, held respectively by government forces and by a disjointed collection of militant groups, including hardcore jihadists. The battle for the city ended with a ceasefire deal, which allowed remaining rebel forces and their families leave Aleppo and go to Idlib governorate, which currently remains a rebel stronghold.

Earlier an increasing number of refugees returning to their homes in Syria was reported by the UN Refugee Agency (UNHCR), which said more than 440,000 internally-displaced persons and 31,000 refugees in other countries had done so over the first six months of 2016. Aleppo and other government-controlled governorates like Hama, Homs and Damascus were mentioned as destinations for the returnees. [..] The situation is far from rosy of course, according to IOM. The number of people forced to leave their homes in 2017 still outweighs that of returnees, with over 808,000 people estimated to be displaced. Around 10% of those who returned in 2016 and 2017 have ended up fleeing their homes again. Almost 20% of the returnees have no secure supply of food and access to water and health services is a problem for some 60%, a testament to the damage the Syrian war has taken on its civilian infrastructure.

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Love it. Absolute must read, the whole article. Very rich.

Do Elephants Have Souls? (NA)

The birth of an elephant is a spectacular occasion. Grandmothers, aunts, sisters, and cousins crowd around the new arrival and its dazed mother, trumpeting and stamping and waving their trunks to welcome the floppy baby who has so recently arrived from out of the void, bursting through the border of existence to take its place in an unbroken line stretching back to the dawn of life. After almost two years in the womb and a few minutes to stretch its legs, the calf can begin to stumble around. But its trunk, an evolutionarily unique inheritance of up to 150,000 muscles with the dexterity to pick up a pin and the strength to uproot a tree, will be a mystery to it at first, with little apparent use except to sometimes suck upon like human babies do their thumbs.

Over time, with practice and guidance, it will find the potential in this appendage flailing off its face to breathe, drink, caress, thwack, probe, lift, haul, wrap, spray, sense, blast, stroke, smell, nudge, collect, bathe, toot, wave, and perform countless other functions that a person would rely on a combination of eyes, nose, hands, and strong machinery to do. Once the calf is weaned from its mother’s milk at five or whenever its next sibling is born, it will spend up to 16 hours a day eating 5% of its entire weight in leaves, grass, brush, bark, and basically any other kind of vegetation. It will only process about 40% of the nutrients in this food, however; the waste it leaves behind helps fertilize plant growth and provide accessible nutrition on the ground to smaller animals, thus making the elephant a keystone species in its habitat. From 250 pounds at birth, it will continue to grow throughout its life, to up to 7 tons for a male of the largest species or 4 tons for a female.

Of the many types of elephants and mammoths that used to roam the earth, one born today will belong to one of three surviving species: Elephas maximus in Asia, Loxodonta africana (savanna elephant) or Loxodonta cyclotis (forest elephant) in Africa. There are about 500,000 African elephants alive now (about a third of them the more reticent, less studied L. cyclotis), and only 40,000 – 50,000 Asian elephants remaining. The Swedish Elephant Encyclopedia database currently lists just under 5,000 (most of them E. maximus) living in captivity worldwide, in half as many locations — meaning that the average number of elephants per holding is less than two; many of them live without a single companion of their kind.

For the freeborn, if it is a cow, the “allomothers” who welcomed her into the world will be with her for life — a matriarchal clan led by the oldest and biggest. She in turn will be an enthusiastic caretaker and playmate to her younger cousins and siblings. When she is twelve or fourteen, she will go into heat (“estrus”) for the first time, a bewildering occurrence during which her mother will stand by and show her what to do and which male to accept. If she conceives, she will have a calf twenty-two months later, crucially aided in birthing and raising it by the more experienced older ladies. She may have another every four to five years into her fifties or sixties, but not all will survive.

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Oct 042016
 
 October 4, 2016  Posted by at 9:36 am Finance Tagged with: , , , , , , , , ,  


Howard Hollem Assembly and Repairs Department Naval Air Base, Corpus Christi 1942

‘I Defy Any Analyst To Tell Me What Deutsche’s Derivatives Are Worth’ (Price)
IMF and ECB Don’t Even See Their Destruction of Greece as a Failure (M. Hudson)
The New Confessions of an Economic Hit Man (Yes!)
Median S&P 500 Stock Is More Overvalued Than At Any Point In History (Hussman)
TARGET2 Shows Europe’s Banking Crisis Is Escalating Again – Fast (Gerifa)
US Stock Buyback Plans Drop To 5 Year Low (ZH)
Subprime Auto-Loan Backed Securities Turn Toxic (WS)
Putin Suspends Plutonium Cleanup Accord With US Citing ‘Unfriendly’ Acts (R.)
Predictable Presidential Temperament (Scott Adams)
When It Comes to Tax Avoidance, Donald Trump’s Just a Small Fry (NYT)
ING Announces 7,000 Job Cuts As Unions Condemn ‘Horror Show’ (G.)
Why Biologists Don’t Believe In Race (BBG)
Bid For Strongest Protection For All African Elephants Defeated At Summit (G.)
EU Signs Deal To Deport Unlimited Numbers Of Afghan Asylum Seekers (G.)
Over 6,000 Migrants Rescued From Mediterranean In A Single Day, 22 Dead (R.)

 

 

Mark-to-Myth.

‘I Defy Any Analyst To Tell Me What Deutsche’s Derivatives Are Worth’ (Price)

This is getting to be a habit. Previous late summer holidays by this correspondent coincided with the run on Northern Rock, and subsequently with the failure of Lehman Brothers. So the final crawl towards the probable nationalisation of Deutsche Bank came as no particular surprise this year, but it is tiresome to relate nevertheless. The 2015 annual report for Deutsche Bank runs to some 448 pages, so one rather doubts if even its CEO, John Cryan, has read it all, or has a complete grasp of, for example, its €42 trillion in total notional derivatives exposure.

Is Deutsche Bank technically insolvent? We’d suggest that it probably is, but we have no dog in the fight, having never either owned banks, or shorted them. And like everybody else we assume that some kind of fix will soon be in – probably one that will further vindicate exposure to gold, both as money substitute and currency substitute. Professor Kevin Dowd, asking whether Deutsche Bank ist kaputt, suggests that the bank’s derivatives exposure is difficult to assess rationally; the value of its derivatives book:

“is unreliable because many of its derivatives are valued using unreliable methods. Like many banks, Deutsche uses a three-level hierarchy to report the fair values of its assets. The most reliable, Level 1, applies to traded assets and fair-values them at their market prices. Level 2 assets (such as mortgage-backed securities) are not traded on open markets and are fair-valued using models calibrated to observable inputs such as other market prices. The murkiest, Level 3, applies to the most esoteric instruments (such as the more complex/illiquid Credit Default Swaps and Collateralized Debt Obligations) that are fair-valued using models not calibrated to market data – in practice, mark-to-myth. The scope for error and abuse is too obvious to need spelling out.”

[As Compass Point’s Charles Peabody exclaims “I defy any analyst to tell me what that {derivative} portfolio is worth.”]

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Michael Hudson reviews Galbraith’s latest book. Europe’s Economic Hit Men.

IMF and ECB Don’t Even See Their Destruction of Greece as a Failure (M. Hudson)

[..] instead of an emerging “European superstate” run by elected representatives empowered to promote economic recovery and growth by writing down debts in order to revive employment, the Eurozone is being run by the troika on behalf of bondholders and banks. ECB and EU technocrats are serving these creditor interests, not those of the increasingly indebted population, business and governments. The only real integration has been financial, empowering the ECB to override national sovereignty to dictate public spending and tax policy. And what they dictate is austerity and economic shrinkage. In addition to a writeoff of bad debts, an expansionary fiscal policy is needed to save the eurozone from becoming a dead zone.

But the EU has no unified tax policy, and money creation to finance deficit spending is blocked by lack of a central bank to monetize government deficits under control of elected officials. Europe’s central bank does not finance deficit spending to revive employment and economic growth. “Europe has devoted enormous effort to create a ‘single market’ without enlarging any state, and while pretending that the Central Bank cannot provide new money to the system.” Without monetizing deficits, budgets must be cut and the public domain sold off, with banks and bondholders in charge of resource allocation. As long as “the market” means keeping the high debt overhead in place, the economy will be sacrificed to creditors. Their debt claims will dominate the market and, under EU and ECB rules, will also dominate the state instead of the state controlling the financial system or even tax policy.

Galbraith calls this financial warfare totalitarian, and writes that while its philosophical father is Frederick Hayek, the political forbear of this market Bolshevism is Stalin. The result is a crisis that “will continue, until Europe changes its mind. It will continue until the forces that built the welfare state in the first place rise up to defend it.” To prevent such a progressive policy revival, the troika promotes regime change in recalcitrant economies, such as it deemed Syriza to be for trying to resist creditor commitments to austerity. Crushing Greece’s Syriza coalition was openly discussed throughout Europe as a dress rehearsal for blocking the Left from supporting its arguments. “Governments from the Left, no matter how free from corruption, no matter how pro-European,” Galbraith concludes, “are not acceptable to the community of creditors and institutions that make up the European system.”

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“..it is not an American empire, it’s not helping Americans. It’s exploiting us in the same way that we used to exploit all these other countries around the world.”

The New Confessions of an Economic Hit Man (Yes!)

Sarah van Gelder : What’s changed in our world since you wrote the first Confessions of an Economic Hit Man?

John Perkins : Things have just gotten so much worse in the last 12 years since the first Confessions was written. Economic hit men and jackals have expanded tremendously, including the United States and Europe. Back in my day we were pretty much limited to what we called the third world, or economically developing countries, but now it’s everywhere. And in fact, the cancer of the corporate empire has metastasized into what I would call a failed global death economy. This is an economy that’s based on destroying the very resources upon which it depends, and upon the military. It’s become totally global, and it’s a failure.

van Gelder : So how has this switched from us being the beneficiaries of this hit-man economy, perhaps in the past, to us now being more of the victims of it?

Perkins : It’s been interesting because, in the past, the economic hit man economy was being propagated in order to make America wealthier and presumably to make people here better off, but as this whole process has expanded in the U.S. and Europe, what we’ve seen is a tremendous growth in the very wealthy at the expense of everybody else. On a global basis we now know that 62 individuals have as many assets as half the world’s population. We of course in the U.S. have seen how our government is frozen, it’s just not working. It’s controlled by the big corporations and they’ve really taken over. They’ve understood that the new market, the new resource, is the U.S. and Europe, and the incredibly awful things that have happened to Greece and Ireland and Iceland, are now happening here in the U.S. We’re seeing this situation where we can have what statistically shows economic growth, and at the same time increased foreclosures on homes and unemployment.

van Gelder : Is this the same kind of dynamic about debt that leads to emergency managers who then turn over the reins of the economy to private enterprises? The same thing that you are seeing in third-world countries?

Perkins : Yes, when I was an economic hit man, one of the things that we did, we raised these huge loans for these countries, but the money never actually went to the countries, it went to our own corporations to build infrastructure in those countries. And when the countries could not pay off their debt, we insisted that they privatize their water systems, their sewage systems, their electric systems. Now we’re seeing that same thing happen in the United States. Flint, Michigan, is a very good example of that. This is not a U.S. empire, it’s a corporate empire protected and supported by the U.S. military and the CIA. But it is not an American empire, it’s not helping Americans. It’s exploiting us in the same way that we used to exploit all these other countries around the world.

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“..easily exceeding the overvaluation observed at the 2000 and 2007 pre-crash extremes.”

Median S&P 500 Stock Is More Overvalued Than At Any Point In History (Hussman)

“In the ruin of all collapsed booms is to be found the work of men who bought property at prices they knew perfectly well were fictitious, but who were willing to pay such prices simply because they knew that some still greater fool could be depended on to take the property off their hands and leave them with a profit.” – Chicago Tribune, April 1890

[..] I’ve noted before that while the bubble peak in 2000 was the most extreme level of valuation in history on a capitalization-weighted basis, the recent speculative episode has actually exceeded that bubble from the standpoint of speculation in individual stocks. The most reliable measures of individual stock valuation we’ve found are based on formal discounted cash flow considerations, but among publicly-available measures we’ve evaluated, price/revenue ratios are better correlated with actual subsequent returns than price/earnings ratios (though normalized profit margins and other factors are obviously necessary to make cross-sectional comparisons).

The chart below shows the median price/revenue ratio across all S&P 500 components, in data since 1986. I should note that from a long-term perspective, the valuation levels we observed in 1986 are actually close to very long-term historical norms over the past century, as the pre-bubble norm for the market price/revenue ratio is just 0.8 in data since 1940. With the exception of 1986, and the 1987, 1990 and 2009 lows, which were moderately but not severely below longer-term historical norms, every point in this chart is “above average” from the standpoint the longer historical record. Presently, the median stock in the S&P 500 is more overvalued than at any point in U.S. history, easily exceeding the overvaluation observed at the 2000 and 2007 pre-crash extremes.

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Unstoppable. There’s not enough fingers for al the holes in the dikes.

TARGET2 Shows Europe’s Banking Crisis Is Escalating Again – Fast (Gerifa)

Problems of Deutsche Bank, Commerzbank, Monte dei Paschi and other German, Italian and Spanish banks are not the only concern of the European Banking System. Trouble is much deeper than it is thought because there is a systemic imbalance that has been increasing for almost ten years. Politicians do not want to tell us the truth, but soon we will experience the same crisis in the Monetary Union as we did in 2012. The extent of the problems in the European Banking System is TARGET2 and its balances of the National Central Banks of the Eurosystem. These balances, or rather imbalances, reflect the direction of the capital flight. And there is only one way: from Southern Europe into Germany. After Draghi’s famous words “I do whatever it takes to save the euro”, things seemed to improve; however, since January 2015 problems have been escalating again.


TARGET2, (i.e. Trans-European Automated Real-Time Gross Settlement Express Transfer System), is a clearing system which allows commercial banks in Europe to conduct payment transactions in the euro through National Central Banks (NCB) and the European Central Bank (ECB).

The excess money flow from banks in one country to banks in another country has to be compensated for. It can be done with loans or so called interbank lending. If there is no compensation from the interbank market (because banks do not trust each other any more) then country A has a liability and country B has a claim and compensation comes from the ECB. Therefore TARGET2 balances are net claims and liabilities of the euro area NCBs vis-a-vis the ECB. As long as the interbank money market in Europe functioned correctly, balances were relatively stable. Excess money that flows from Greece to Germany was compensated for with the purchase of Greek bonds or by interbank lending. However, after the crisis in the Euro Area, banks have stopped lending each other money and the compensation has to be provided by the central bank.

As the Euro Crisis Monitor shows, on the basis of the ECB data, the money is going now to Germany and also to Luxembourg, the Netherlands and Finland, while all other national banks have increasing liabilities! The worst situation is in Spain and Italy who are now close to the 2012 negative records. The current imbalance, or the excessive flow of money from Southern Europe to Northern Europe is not related to the trade balance deficit. Spain and Italy have managed to reduce their trade balance deficits. We hope clients from Banca Monte dei Paschi di Siena have not moved their money to Deutsche Bank. The Greek balance seems to be improving, but it is due to capital control: banks in Greece are limited in using the system.

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The only game is leaving town.

US Stock Buyback Plans Drop To 5 Year Low (ZH)

The value of stock buyback announcements from U.S. companies slowed to its lowest level in nearly five years, dropping to a fresh nine quarter low, TrimTabs Investment Research said on Monday, potentially jeopardizing one of the main drivers of the rising stock market. TrimTabs calculated that buybacks rebounded to $59.9 billion in September from a 3.5 year low of $21.5 billion in August, but two-thirds of last month’s volume was due to a single buyback by Microsoft. The 39 buybacks rolled out last month was the lowest number in a month since January 2011. “Buybacks have been trending lower for the past two years, which is a cautionary longer-term signal for U.S. equities,” said Winston Chua, analyst at TrimTabs. “Along with central bank asset purchases, buybacks have been a key pillar of support for the bull market.”

Somewhat surprisingly, the decline in buybacks takes place even as corporations issue record amounts of debt which in previous years was largely put toward stock repurchases but is increasingly going to fund maturing debt due to a rising rollover cliff in the coming year. “The U.S. stock market isn’t likely to get as much of a boost from buybacks as it did in recent years,” noted Chua. “Apart from big tech firms and the too-big-to-fails, fewer companies seem willing to use lots of cash to support share prices. One month ago, David Santschi, CEO of TrimTabs, warned that “buyback activity has been disappointing in earnings season”, a trend that has persisted in the coming weeks. “The reluctance to pull the trigger on share repurchases suggests corporate leaders are becoming less enthusiastic about what they see ahead.”

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As car sales are already under threat.

Subprime Auto-Loan Backed Securities Turn Toxic (WS)

In the subprime auto loan market, things are turning ugly as delinquencies and losses have begun soaring. Specialized lenders – a couple of big ones, and a whole slew of small ones that service the lower end of the subprime market – slice and dice these loans, repackage them into auto-loan backed securities (auto ABS), and sell them to investors, such as yield-hungry pension funds. Delinquencies of 60 days and higher among subprime auto ABS increased by 22% year-over-year in August, Fitch Ratings reported on Friday – now amounting to 4.9% of the outstanding balances that Fitch tracks and rates. And subprime annualized losses increased by 27% year-over-year, reaching 8.9% of the outstanding balances of auto ABS.

Even delinquencies among prime borrowers are rising, with delinquencies of 60 days or more increasing by 17% from a year ago, and annualized losses by 11%, though they’re still relatively tame at 0.4% and 0.6% respectively of the balances outstanding. And according to Fitch, the toxicity level in the subprime auto ABS space isgoing to rise, with “subprime auto losses to pierce 10% by year-end.” Total auto loan balances, both subprime and prime – given the soaring prices of cars, the stretched terms of the loans, and the ballooning loan-to-value ratios – have been skyrocketing, up 46% from the first quarter in 2011 through the second quarter in 2016, when they hit $1.07 trillion:

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“..taking into account this tension (in relations) in general … the Russian side considers it impossible for the current state of things to last any longer.”

Putin Suspends Plutonium Cleanup Accord With US Citing ‘Unfriendly’ Acts (R.)

Russian President Vladimir Putin on Monday suspended an agreement with the United States for disposal of weapons-grade plutonium because of “unfriendly” acts by Washington, the Kremlin said. A Kremlin spokesman said Putin had signed a decree suspending the 2010 agreement under which each side committed to destroy tonnes of weapons-grade material because Washington had not been implementing it and because of current tensions in relations. The two former Cold War adversaries are at loggerheads over a raft of issues including Ukraine, where Russia annexed Crimea in 2014 and supports pro-Moscow separatists, and the conflict in Syria.

The deal, signed in 2000 but which did not come into force until 2010, was being suspended due to “the emergence of a threat to strategic stability and as a result of unfriendly actions by the United States of America towards the Russian Federation”, the preamble to the decree said. It also said that Washington had failed “to ensure the implementation of its obligations to utilize surplus weapons-grade plutonium”. The 2010 agreement, signed by Russian Foreign Minister Sergei Lavrov and then-U.S. Secretary of State Hillary Clinton, called on each side to dispose of 34 tonnes of plutonium by burning in nuclear reactors. Clinton said at the time that that was enough material to make almost 17,000 nuclear weapons.

Both sides then viewed the deal as a sign of increased cooperation between the two former adversaries toward a joint goal of nuclear non-proliferation. “For quite a long time, Russia had been implementing it (the agreement) unilaterally,” Kremlin spokesman Dmitry Peskov told a conference call with journalists on Monday. “Now, taking into account this tension (in relations) in general … the Russian side considers it impossible for the current state of things to last any longer.”

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Dilbert creator Scott Adams was apparently “shadowbanned” by Twitter in the aftermath of this post for asking his followers for examples of Clinton supporters being violent against peaceful Trump supports in public.

Predictable Presidential Temperament (Scott Adams)

Do you remember the time someone insulted Donald Trump and then Trump punched him in the nose? Neither do I. Because nothing like that has ever happened. Instead, people attack Donald Trump with words (often) and he attacks them back with words. See if the following pattern looks familiar: 1. Person A insults Trump with words. Trump insults back with words. 2. Person B mentions some sort of scandal about Trump. Trump mentions some sort of scandal about Person B. 3. Person C endorses Trump (even if they publicly feuded before) and Trump immediately says something nice about Person C. The feud is instantly over. See the pattern? Consider how many times you have seen the pattern repeat with Trump. It seems endless. And consistent.

Trump replies to critics with proportional force. His reaction is as predictable as night following day. The exceptions are his jokey comments about roughing up protesters at his rallies. The rally-goers recognize it as entertainment. I won’t defend his jokes at rallies except to say that it isn’t a temperament problem when you say something as a joke and people recognize it as such. (We see his rally joke-comments out of context on news coverage so they look worse.) What we have in Trump is the world’s most consistent pattern of behavior. For starters, he only responds to the professional critics, such as the media and other politicians. When Trump responded to the Khan family and to Miss Universe’s attacks, they had entered the political arena.

As far as I know, private citizens – even those critical of Trump – have never experienced a personal counter-attack. Trump limits his attacks to the folks in the cage fight with him. And when Trump counter-attacks, he always responds with equal measure. Words are met with words and scandal mentions are met with scandal mentions. (And maybe a few words.) But always proportionate and immediate. Does any of that sound dangerous? What if Trump acted this way to our allies and our adversaries? What then? Answer: Nothing Our allies won’t insult Trump, and they won’t publicly mention any his alleged scandals. They will respect the office of the President of the United States no matter what they think of Trump.

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“Avoidance” is already a leading, and therefore unfortunate, term.

When It Comes to Tax Avoidance, Donald Trump’s Just a Small Fry (NYT)

Not paying taxes “makes me smart,” Donald J. Trump said last week. His surrogates called him “a genius” for his recently revealed tax avoidance strategies. Well, if they are right, the executives running corporate America are absolute virtuosos. An exhaustive study being released on Tuesday by a group of researchers shows in detail how Fortune 500 companies have managed to shelter trillions of dollars in profits offshore from being taxed. Mr. Trump’s efforts pale by comparison. Worse, the companies have managed to hide many of their tax havens completely, in many cases reporting different numbers to different government agencies to obfuscate exactly how they’ve avoided Uncle Sam. And, yes, it is all legal.

The immediate response from many readers may be ire for the companies avoiding taxes — or for Mr. Trump. But that’s not the goal of this particular column. In this case, that kind of thinking may even be counterproductive. Instead, the study — which notes that 58 Fortune 500 companies would owe $212 billion in additional federal taxes, “equal to the entire state budgets of California, Virginia and Indiana combined,” if they were taxed properly — should be a five-alarm call to voters and lawmakers to finally fix the tax system. If all the attention on Mr. Trump’s tax bill (or lack of one) isn’t enough to inspire a complete rewrite of the tax code, this study may be. The authors of the report, which include the U.S. PIRG Education Fund and Citizens for Tax Justice, combed through the filings of the Fortune 500 for 2015 and found an astonishing 73% “maintained subsidiaries in offshore tax havens.”

Maybe it is to be expected. Companies and individuals complain bitterly that taxes are too high and the rules too complicated, but many corporations and the wealthiest members of our society have found ways to make the tax code work for them. If all the Fortune 500 companies paid taxes on their sheltered profits, the researchers tallied, the government would receive a whopping $717.8 billion windfall. To put that number in context, the 2015 federal budget deficit was $438 billion. However, fixing our corporate tax system alone isn’t the answer to reducing our red ink; it might only be a drop in the bucket given that our total federal debt is nearing $20 trillion.

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Government bails out bank with taxpayers money, which then goes and fires taxpayers. What’s wrong with this picture?

ING Announces 7,000 Job Cuts As Unions Condemn ‘Horror Show’ (G.)

ING’s plans to shed 7,000 jobs and invest in its digital platforms to make annual savings of €900m by 2021 has drawn swift criticism of the Netherlands’ largest financial services company from unions. The layoffs represent slightly less than 12% of ING’s 52,000 workforce, because nearly 1,000 are expected to come at suppliers rather than at the bank itself. But they are the heaviest since 2009, when ING was forced to restructure and spin off its insurance activities after receiving a state bailout during the financial crisis. Unions were highly critical.

“I don’t think this was the intention of the [government] when it kept ING afloat with bailout money,” Ike Wiersinga of the Dutch union CNV said. In Belgium, where the number of jobs lost will be highest, labour leader Herman Vanderhaegen called the decision a “horror show” and said workers would strike on Friday 7 October. Although other large banks have announced mass layoffs at branch offices in the past year to boost profitability, ING said the job cuts were partly to combine technology platforms and risk-control centres, as well to help it to contend with regulatory burdens and low interest rates.

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Race is an invention to justify terrorizing groups of people.

Why Biologists Don’t Believe In Race (BBG)

Race is perhaps the worst idea ever to come out of science. Scientists were responsible for officially dividing human beings into Europeans, Africans, Asians and Native Americans and promoting these groups as sub-species or separate species altogether. That happened back in the 18th century, but the division lends the feel of scientific legitimacy to the prejudice that haunts the 21st. Racial tension proved a major point of contention in the first 2016 presidential debate, and yet just days before, scientists announced they’d used wide-ranging samples of DNA to add new detail to the consensus story that we all share a relatively recent common origin in Africa.

While many human species and sub-species once roamed the planet, there’s abundant evidence that beyond a small genetic contribution from Neanderthals and a couple of other sub-species, only one branch of humanity survived to the present day. Up for grabs was whether modern non-Africans stemmed from one or more migrations out of Africa. The newest data suggests there was a single journey – that sometime between 50,000 and 80,000 years ago, a single population of humans left Africa and went on to settle in Asia, Europe, the Americas, the South Pacific, and everywhere else. But this finding amounts to just dotting the i’s and crossing the t’s on a scientific view that long ago rendered notion of human races obsolete.

“We never use the term ‘race,’ ” said Harvard geneticist Swapan Mallick, an author on one of the papers revealing the latest DNA-based human story. “We’re all part of the tapestry of humanity, and it’s interesting to see how we got where we are.” That’s not to deny that people vary in skin color and other visible traits. Whether you’re dark or light, lanky or stocky depends in part on the sunlight intensity and climate in the regions where your ancestors lived. Nor is it to deny that racism exists – but in large part, it reflects a misinterpretation of those superficial characteristics. “There is a profound misunderstanding of what race really is,” Harvard anthropology professor Daniel Lieberman said at an event the night after the presidential debate. “Race is a scientifically indefensible concept with no biological basis as applied to humans.”

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Titanic and the Deckchairs. Nice name for a band. But with this I’m more convinced than ever that we will need to put the death penalty on killing elephants and lions and many other species. And we have to put our armies to good use, ours, not that of the military-industrial complex. Mankind will not survive with the natural world that gave birth to it, thoroughly decimated. And if you doubt that, ask yourself why on earth we should take the chance. And have our children know the most iconic animals on earth only from photos from the past.

Bid For Strongest Protection For All African Elephants Defeated At Summit (G.)

A bid to give the highest level of international legal protection to all African elephants was defeated on Monday at a global wildlife summit. The EU played a pivotal role in blocking the proposal, which was fought over by rival groups of African nations. But the Convention on the International Trade in Endangered Species (Cites), meeting this week in Johannesburg, passed other new measures for elephants that conservationists say will add vital protection. All 182 nations agreed for the first time that legal ivory markets within nations must be closed. Separately, a process that could allow one-off sales of ivory stockpiles was killed and tougher measures to deal with nations failing to control poached ivory were agreed.

More than 140,000 of Africa’s savannah elephants were killed for their ivory between 2007 and 2014, wiping out almost a third of their population, and one elephant is still being killed by poachers every 15 minutes on average. The price of ivory has soared threefold since 2009, leading conservationists to fear the survival of the species is at risk. The acrimonious debate over elephant poaching has split African countries. Namibia, South Africa and Zimbabwe, which host about a third of all remaining elephants, have stable or increasing populations. They argue passionately that elephant numbers are also suffering from loss of habitat and killings by farmers and that they can only be protected by making money from ivory sales and trophy hunting.

[..] Kelvin Alie, at the International Fund for Animal Welfare, said the failure to put all elephants on appendix one was a disaster: “This is a tragedy for elephants. At a time when we are seeing such a dramatic increase in the slaughter of elephants for ivory, now was the time for the global community to step up and say no more.”

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FIghting rages across Afghanistan as we speak. It has ever since ‘western interests’ invaded.

EU Signs Deal To Deport Unlimited Numbers Of Afghan Asylum Seekers (G.)

The EU has signed an agreement with the Afghan government allowing its member states to deport an unlimited number of the country’s asylum seekers, and obliging the Afghan government to receive them. The deal has been in the pipeline for months, leading up to a large EU-hosted donor conference in Brussels this week. According to a previously leaked memo, the EU suggested stripping Afghanistan of aid if its government did not cooperate. The deal, signed on Sunday, has not been made public but a copy seen by the Guardian states that Afghanistan commits to readmitting any Afghan citizen who has not been granted asylum in Europe, and who refuses to return to Afghanistan voluntarily. It is the latest EU measure to alleviate the weight of the many asylum seekers who have arrived since early 2015. Afghans constituted the second-largest group of asylum seekers in Europe, with 196,170 applying last year.

While the text stipulates a maximum of 50 non-voluntary deportees per chartered flight in the first six months after the agreement, there is no limit to the number of daily deportation flights European governments can charter to Kabul. With tens of thousands set to be deported, both sides will also consider building a terminal dedicated to deportation flights at Kabul international airport. The agreement, Joint Way Forward, also opens up the deportation of women and children, which at the moment almost exclusively happens from Norway: “Special measures will ensure that such vulnerable groups receive adequate protection, assistance and care throughout the whole process.” If family members in Afghanistan cannot be located, unaccompanied children can be returned only with “adequate reception and care-taking arrangement having been put in place in Afghanistan”, the text says.

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On and on and on and on.

Over 6,000 Migrants Rescued From Mediterranean In A Single Day, 22 Dead (R.)

About 6,055 migrants were rescued and 22 found dead on the perilous sea route to Europe on Monday, one of the highest numbers in a single day, Italian and Libyan officials said. Italy’s coastguard said at least nine migrants had died and a pregnant woman and a child had been taken by helicopter to a hospital on the Italian island of Lampedusa, halfway between Sicily and the Libyan coast. Libyan officials said 11 migrant bodies had washed up on a beach east of the capital, Tripoli, and another two migrants had died when a boat sank off the western city of Sabratha. One Italian coast guard ship rescued about 725 migrants on a single rubber boat, one of some 20 rescue operations during the day.

About 10 ships from the coast guard, the navy and humanitarian organisations were involved in the rescues, most of which took place some 30 miles off the coast of Libya. Libyan naval and coastguard patrols intercepted three separate boats carrying more than 450 migrants, officials said. Monday was the third anniversary of the sinking of a migrant boat off the Italian island of Lampedusa in which 386 people died. According to the International Organisation for Migration, around 132,000 migrants have arrived in Italy since the start of the year and 3,054 have died.

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Oct 012016
 
 October 1, 2016  Posted by at 9:26 am Finance Tagged with: , , , , , , , , , , ,  Comments Off on Debt Rattle October 1 2016


Lewis Wickes Hine Drift Mouth, Sand Lick Mine, near Grafton, West Virginia 1908

Why You Should Be Skeptical Of That $5.4 Billion Deutsche Settlement (CNBC)
A Deutsche Bank Settlement Rumor Overshadows US Equities (R.)
Deutsche Bank Takes a Lashing From the German Public (WSJ)
Trump Will Win, Unless the S&P Rallies in October (BBG)
Global Trade Crashes Back To “Very Old Normal” (ZH)
Global Corporate Default Tally By Far Highest Since 2009 (Barron’s)
US, Canadian IPOs Raise Lowest Annual Total Since 1990 (BBG)
US Consumer Spending Drops, Clouds Fed Rate Hike Outlook (R.)
China’s Yuan Joins Elite Club Of IMF Reserve Currencies (R.)
State Spending Keeps China’s Industrial Sector Humming in September (WSJ)
Has Vancouver Found The Solution To A Super-Heated Housing Market? (G.)
Bundesbank President Rejects Calls for German Stimulus (WSJ)
The “Pardon Snowden” Case Just Got Stronger (Cato)
Brexit Is A ‘Once-in-a-Generation’ Chance To Save UK’s WIldlife (Ind.)
Bees Added To US Endangered Species List For The First Time (G.)
Elephants Have Learned To Avoid Poachers By Hanging Out With Rangers (Konbini)

 

 

A planted rumor. “..if the number was correct, under German capital market rules Deutsche Bank would be required to confirm the amount by now..”

Why You Should Be Skeptical Of That $5.4 Billion Deutsche Settlement (CNBC)

Shares of Deutsche Bank were leaping in New York trade Friday on a report that it was near a settlement with the U.S. Department of Justice, but there’s reason to be skeptical about the number being cited. Shares of Deutsche Bank have extended their gains, up about 14% in afternoon trading, after an AFP report that Germany’s biggest bank is close to a $5.4-billion dollar settlement with the Justice Department over mortgage bonds. […] But if the number was correct, under German capital market rules Deutsche Bank would be required to confirm the amount by now. Its failure to do so indicates the number is not correct.

Any eventual settlement, however, would almost certainly be well below the reported $14-billion opening bid by the Department of Justice in its talks with Deutsche. Deutsche Bank is not publicly commenting on the supposed $5.4-billion figure. The capital market rules say the bank would have to react almost immediately to a report on such a settlement. That’s why two weeks ago, after The Wall Street Journal reported on the initial $14-billion figure, Deutsche Bank quickly put out a release confirming the news. “The negotiations are only just beginning,” Deutsche Bank said at the time. “The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts.”

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Far from over: “Once they come to some resolution on the difference between what they are charged, $14 billion, and what they are going to pay, call it $5 or $6 billion, the market is going to be afraid there is a problem..”

A Deutsche Bank Settlement Rumor Overshadows US Equities (R.)

Deutsche Bank will likely cast a pall over equity markets next week as the largest German lender navigates a possible multi-billion dollar settlement with the U.S. Department of Justice over the sale of mortgage-backed bonds. Deutsche shares traded in the United States hit a record low on Thursday, falling as much as 24% since the DOJ asked the bank to pay $14 billion to settle charges related to its sale of toxic mortgage bonds before the financial crisis. But the stock had its best day in five years Friday, on record volume, after news agency AFP reported that Deutsche was nearing a much-lower $5.4 billion settlement with the DOJ. Analysts at Morgan Stanley estimated Deutsche could pay about $6 billion to settle with the DOJ. Stocks on Wall Street broadly tracked Deutsche over the past few days and will likely continue to do so, analysts say.

“While it is in the headlines, it is an overhang,” said Art Hogan at Wunderlich Securities in New York. “Once they come to some resolution on the difference between what they are charged, $14 billion, and what they are going to pay, call it $5 or $6 billion, the market is going to be afraid there is a problem,” Hogan said. Deutsche’s market capitalization of near $18 billion makes it much smaller than its U.S. peers like Bank of America, at $155 billion, or Citi, at $133 billion. However its trading relationships with the world’s largest financial institutions make a potential breakdown at Deutsche a bigger risk to the wider financial system than any other global bank, the International Monetary Fund said in June. “Its world print and eurocentric role are unrivaled, so it is going to drive the narrative next week,” said Peter Kenny at Global Markets Advisory Group in New York.

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Merkel’s room to move is shrinking.

Deutsche Bank Takes a Lashing From the German Public (WSJ)

Deutsche Bank is getting rough treatment in the market. It is also having a hard time with its own public. The lender, founded in 1870, has turned from an object of patriotic pride into what critics on both sides of the political spectrum openly deride as a national embarrassment. Multibillion-dollar losses last year, investigations into misconduct around the world, concerns about its capital cushion and rich pay have made Deutsche Bank a handy target for left-leaning critics that accuse it of short-term thinking and greed. Many on the far right, meanwhile, regard Deutsche Bank as German in name only. Three out of its past four chief executives have been foreigners, including current CEO John Cryan, helping detractors tar it as the embodiment of out-of-control stateless capitalism.

The sentiment isn’t confined to political circles. A TNS Emnid poll for news magazine Focus conducted on Wednesday and released on Friday showed that 69% of respondents opposed any kind of state aid for Deutsche Bank, with only 24% in favor. “People feel it’s simply unacceptable that banks should be exempted from business risks,” said Frank Decker, politics professor at Rheinische Friedrich-Wilhelms-University in Bonn. [..] the lack of support at home, along with strict bailout rules Germany has backed for banks in the European Union, could limit the government’s room for maneuver should Deutsche Bank end up in a position that it does need help.

Despite the trauma of the financial crisis, large institutions such as Deutsche Bank haven’t learned any lessons, said Manfred Güllner, head of the Forsa polling group, making any bailout a tougher sell than in 2008. “While the returns on savings keep falling in a bottomless pit—and now into negative territory—the banks, as always, keep conducting their risky speculative businesses,” the populist Alternative for Germany party said in a Facebook post Thursday. “Whenever they get in trouble, the politicians are always there to help with taxpayers’ money.”

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“When the stock market ends up for the three-month period, the Democrat wins. When it’s negative, the Republican wins.”

Trump Will Win, Unless the S&P Rallies in October (BBG)

October is the bad boy of the stock market. The Panic of 1907, the Crash of 1929, Black Monday in 1987. It’s notable for another reason, too. The performance of Standard & Poor’s 500-stock index from July 31 to Oct. 31 has a curious way of predicting the winner of the presidential election. As with every prediction, take it with a giant grain of salt. But the pattern is solid, as shown in this chart by Sam Stovall, equity strategist for S&P Global Market Intelligence1. When the stock market ends up for the three-month period, the Democrat wins.

When it’s negative, the Republican wins. Since this July 31, the S&P is in slightly negative territory. Two times the pattern didn’t hold were in 1968 and 1980, when influential third-party candidates were in race, including George Wallace, who took about 14% of the popular vote in ’68. The pattern also failed in 1956, which Stovall says could be attributed to geopolitical events putting the markets on edge. That was the year of the Suez Crisis and the Hungarian Uprising, he noted.

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“What if the last 30 years of exuberant world trade growth was the ‘outlier’..”

Global Trade Crashes Back To “Very Old Normal” (ZH)

“Get used to it” is the message from Goldman Sachs when it comes to the collapse in global trade… What if the last 30 years of exuberant world trade growth was the ‘outlier’ and we are now reverting to the pre-Greenspan normal? As Goldman’s Goohoon Kwon explains, a low trade beta may be normal:

“Finally, another explanation for the trade slowdown is that it simply represents a return to normal. Historical trade data show that the global trade beta was slightly higher than 1 in the early 1950s before rising gradually due to a series of extraordinary events. In the 1960s-1980s, it rose to around 1.5, boosted by multilateral efforts for trade reforms, which reduced average tariffs from 35% in 1947 to 6.4% at the start of the of the Uruguay Round (1986-94) of global trade negotiations. Thereafter, the breakup of the Soviet Union enabled global trade to expand rapidly in the 1990s, and the WTO entry of China in 2001 helped sustain the trade beta at around 2 in the 2000s. There is therefore an argument that a series of largely one-off factors drove the trade beta to unusually high levels.”

And as Goldman warns, there is limited upside to global trade from here…

“Given these structural forces, the outlook for global trade remains weak in our view, though it might rebound somewhat in the short term. Asian trade is likely to recover moderately in coming years, helped by the eventual dissipation of capacity overhangs in China and reductions in internal imbalances in the economy. And further trade liberalization, including in services, presents upside for global trade. However, the restructuring of overcapacity sectors seems to be proceeding slowly so far in Asia, as reflected in low and still-falling capacity utilization in China and Korea. Moreover, the current political backdrops in the major economies suggest that another major push for trade liberalization might be off the table, at least for now.”

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By far the worst year since 2009.

Global Corporate Default Tally By Far Highest Since 2009 (Barron’s)

Three corporate defaults in the past week, two metals companies and one telecom firm, brought the total number of defaults around the world to 130. That’s a lot more than last year. Diane Vazza, head of S&P Global Fixed Income Research says: “The default tally is 60% higher than the count at this time in 2015 and has surpassed the total number of defaults recorded in full-year 2015, 113 defaults. The last time the global tally was higher at this point in the year was in 2009, when it reached 223 during the financial crisis.” Energy and commodity-related firms make up over half of the defaults; 70% are U.S. companies. Vazza notes: “As of Aug. 31, 2016, the global speculative-grade default rate for the energy and natural resources sector was 17.9%–more than seven times higher than the default rate of all other sectors.”

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How to make a pretty awful number sound good.

US, Canadian IPOs Raise Lowest Annual Total Since 1990 (BBG)

It’s been a paltry year for initial public offerings. Fewer than 135 companies have made their debuts in U.S. and Canada, putting 2016 on pace to be the slowest for IPOs since 1990, according to data compiled by Bloomberg. With $14.4 billion raised so far, we’re also on track to witness the lowest annual total on that score since 1990. For the companies that have made it to market, the dearth of activity has helped underpin demand. That’s especially true in the case of tech IPOs, where (as my colleague Shira Ovide has written) the paucity of new issues has left investors scrambling for any new listing, driving valuations to potentially unsustainable levels.

Nutanix, a tech unicorn that priced Thursday evening, will likely continue the trend, with its shares poised for a surge when they begin trading Friday. But another crop of listings – backed by private equity – has also done well out of the chute this year, and may offer the potential for more lasting gains. On average, new issues of private-equity backed companies have rallied 34.5% this year through Thursday, topping the 28.2% average return for all U.S. and Canadian IPOs during the same period, according to data compiled by Bloomberg.

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David Stockman put it like this: “They shopped till they dropped.”

US Consumer Spending Drops, Clouds Fed Rate Hike Outlook (R.)

U.S. consumer spending fell in August for the first time in seven months while inflation showed signs of accelerating, mixed signals that could keep the Federal Reserve cautious about raising interest rates. The Commerce Department said on Friday that consumer spending, which accounts for more than two-thirds of U.S. economic activity, fell 0.1% last month after accounting for inflation. Analysts polled by Reuters had expected a 0.1% gain. “Consumers took a breather in August,” said Chris Christopher of IHS Global Insight. Fed Chair Janet Yellen said last week she expected the U.S. central bank would raise rates once later this year to keep the economy from eventually overheating.

Prices for fed funds futures suggest investors see almost no chance of a hike at the Fed’s next policy meeting in early November and roughly even odds of an increase at its mid-December meeting, according to CME Group. The dollar was little changed against a basket of currencies while U.S. stock prices were trading higher. Consumer spending, which has been robust in recent months, partially offset the drag from weak business investment and falling inventories in the second quarter when the economy expanded at a lackluster 1.4% annual rate.

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A mixed blessing.

China’s Yuan Joins Elite Club Of IMF Reserve Currencies (R.)

China’s yuan joins the IMF’s basket of reserve currencies on Saturday in a milestone for the government’s campaign for recognition as a global economic power. The yuan joins the U.S. dollar, the euro, the yen and British pound in the IMF’s special drawing rights (SDR) basket, which determines currencies that countries can receive as part of IMF loans. It marks the first time a new currency has been added since the euro was launched in 1999.The IMF is adding the yuan, also known as the renminbi, or “people’s money”, on the same day that the Communist Party celebrates the founding of the People’s Republic of China in 1949.

“The inclusion into the SDR is a milestone in the internationalization of the renminbi, and is an affirmation of the success of China’s economic development and results of the reform and opening up of the financial sector,” the People’s Bank of China said in a statement. China will use this opportunity to further deepen economic reforms and open up the sector to promote global growth, the central bank added. The IMF announced last year that it would add the yuan to the basket, so actual inclusion is not expected to impact financial markets. But it puts Beijing’s often opaque economic and foreign exchange policy in the international spotlight as some central banks add yuan assets to their official reserves.

Critics argue that the move is largely symbolic and the yuan does not fully meet IMF reserve currency criteria of being freely usable, or widely used to settle trade or widely traded in financial markets. U.S. Republican presidential nominee Donald Trump has said he will formally label China a currency manipulator if he wins November’s election. China stunned investors by devaluing the currency last year and the yuan has since weakened to near six-year lows, adding to worries about already feeble global growth. Some China watchers also fear that Beijing’s commitment to further market opening and financial sector reforms will fade after its diplomatic success, despite repeated reassurances from Beijing it will continue with the process.

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Now that China has entered the IMF basket, it’ll get much harder to keep this up: “It’s very clear that this sort of continued funding of industrial overcapacity sectors is unsustainable.”

State Spending Keeps China’s Industrial Sector Humming in September (WSJ)

Activity in China’s crucial industrial sector appeared to stabilize last month, with an official index on manufacturing holding steady, buoyed by state spending on infrastructure. China’s official manufacturing purchasing managers index was unchanged at 50.4 in September compared with August, the National Bureau of Statistics reported Saturday. The gauge has remained above 50, which separates expansion from contraction, for six out of the past seven months. The September reading matched a median forecast of 50.4 by 11 economists polled by The Wall Street Journal.

Subindexes gave mixed readings. One measured new orders weakening, while another for production showed improvement; both remained above 50. The official nonmanufacturing PMI edged up to 53.7 in September from 53.5 in August. Economists said stepped-up bank lending and spending on government projects is helping to steady an economy that got off to a wobbly start to the year and has been slowing overall in recent years. “You’re seeing a bit of a credit-fueled holding pattern,” said Angus Nicholson, an analyst with IG Markets. “The question is: when does that turn around and when are they going to cut credit? It’s very clear that this sort of continued funding of industrial overcapacity sectors is unsustainable.”

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Better question: do other cities have the guts to follow suit?

Has Vancouver Found The Solution To A Super-Heated Housing Market? (G.)

There is a city which is suffering a worse property bubble than Sydney, whose residents are more priced-out than Londoners, and where there is a greater divide between the housing haves and have-nots than even San Francisco. That city is Vancouver, and in response to these mounting challenges, the west-coast Canadian metropolis recently imposed an extraordinary new tax on foreign buyers – whose impact is now being watched closely by other cities grappling with bloated property markets. On 2 August, Vancouver introduced a tax on anyone from outside Canada wanting to buy a home in its super-heated market. In future, city authorities said, if you weren’t Canadian, you would have to pay an extra 15% on the purchase price.

The impact has, by some measures, been more startling than campaigners could have hoped for. The price of the average detached home reportedly slumped by an astonishing 16.7% in August alone to C$1.47m (£856,000), according to the Real Estate Board of Greater Vancouver. Some agents are reporting that the market has gone from red hot to stone cold in a matter of weeks. British Columbia’s premier, Christy Clark, who introduced the tax, told reporters there will be no going back on it. “The prices were going up way too fast and if we helped slow that down, that’s good,” she said. In the year before the tax, prices in the city were galloping ahead at a rate of 39% a year amid widespread concern that investors, from China in particular, were pricing out local residents.

It is a concern echoed in cities across the Pacific Rim. In June, Sydney introduced a 4% stamp duty surcharge on foreigners buying homes; the following month, Melbourne hiked stamp duty rates from 3% to 7% for foreign buyers – in both cases to deter rampant property speculation. Queensland, whose capital is Brisbane, has followed suit with an extra 3% duty surcharge that will be slapped on “foreign persons” buying residential property and land from 1 October. In Auckland, New Zealand – currently the world’s frothiest property market – property investors are, as of last month, required to put down at least 40% of the purchase price in cash.

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By ignoring Germany’s role in destroying the Greek and Italian economies, Weidmann ensures the downfall of the eurozone, and thereby of Germany itself.

Bundesbank President Rejects Calls for German Stimulus (WSJ)

It’s absurd to ask Germany’s government to spend more to bolster eurozone growth, German Central Bank President Jens Weidmann said on Thursday, rejecting growing pressure on Berlin to loosen its purse strings. Speaking in the German capital, Mr. Weidmann said a fiscal stimulus program in Germany was unnecessary given the nation’s robust economy, and would have few positive effects for other countries anyway. Earlier this month, ECB President Mario Draghi joined the chorus of voices that have criticized Germany for reining in its spending at a time of weak economic growth. “Countries that have fiscal space should use it,” Mr. Draghi said at a news conference. “Germany has fiscal space.”

But Mr. Weidmann argued that Germany’s national debt was already high, and the country’s aging population “calls for lower rather than higher debts.” Mr. Draghi tempered his remarks on Wednesday after a meeting in Berlin with German lawmakers, who grilled him over the ECB’s easy-money policies and their impact on German savers and banks. “Germany does have fiscal space [but] we need to be nuanced,” Mr. Draghi said. “I never argued for irresponsible fiscal expansion.”

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It couldn’t be more obvious.

The “Pardon Snowden” Case Just Got Stronger (Cato)

Yesterday, the Department of Justice Inspector General (DoJ IG) issued a long overdue Congressionally-mandated report on FBI compliance with the PATRIOT Act’s Section 215 “business records” provision between 2012 and 2014. It is the first such report issued that covers the initial period of Edward Snowden’s revelations about widespread domestic mass surveillance by the federal government. Since his indictment for leaking the information to the press, Snowden’s lawyers have argued that he should not be prosecuted under the WW I-era Espionage Act because his revelations served the public interest. The DoJ IG report provides the clearest evidence yet that Snowden’s lawyers are correct (p. 6):

“In June 2013, information about the NSA’s bulk telephony metadata program was publicly disclosed by Edward Snowden. These disclosures revealed, among other things, that the FISA Court had approved Section 215 orders authorizing the bulk collection of call detail records. The telephony metadata collected by the NSA included information from local and long-distance telephone calls, such as the originating and terminating telephone number and the date, time, and duration of each call. The disclosures prompted widespread public discussion about the bulk telephony metadata program and the proper scope of government surveillance, and ultimately led Congress to end bulk collection by the government in the USA Freedom Act.”

Public discussion of the controversy. Very public action by Congress to change the law, addressing at least one major abuse brought to light by Snowden. And there was more (p. 33):

“An [National Security Division] Deputy Unit Chief noted that the number of business records orders reached its peak in 2012 and has declined annually since then, and that the number of [Electronic Communication Transation] requests has declined more than other types of requests. The Deputy Unit Chief said that the Snowden revelations have played a role in this decline, both in terms of the stigma attached to use of Section 215 and increased resistance from providers. The Deputy Unit Chief stated, “I think that it’s possible that folks … have decided it’s not worth pursuing [business records orders], you know, obviously things haven’t been great with providers since Snowden either.” ”

Translation: Snowden’s actions forced companies like Verizon, Yahoo and others to grow a spine and start defending the Fourth Amendment rights of their customers. Earlier this month, a group of non-governmental organizations and individuals launched a campaign to get President Obama to pardon Snowden before he leaves office. We now have the department seeking Snowden’s prosecution offering unambigous evidence that his whistleblowing actions served the public interest. Obama should direct DoJ to drop the case or he should pardon Snowden. Either approach would be in the public interest, just as Snowden’s actions were.

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if there’s anyone left claiming to be surprised by Brexit, they must be blind.

Record Numbers Left Homeless After Eviction By Private Landlords In UK (G.)

Record numbers of families are becoming homeless after being evicted by private landlords and finding themselves unable to afford a suitable alternative place to live, government figures show. The end of an assured shorthold tenancy (AST) was cited by nearly a third of the 15,170 households in England who were classed as homeless in the three months to June – a number that was up 10% on the same period last year. The problem was particularly acute in London, accounting for 41% of all homelessness acceptances in the capital during the period, according to figures from the Department for Communities and Local Government (DCLG). The end of an AST has rapidly become the single biggest cause of homelessness in recent years, triggered by spiralling rent rises and cuts to housing benefit support.

In 2010 just 11% of homeless acceptances in England were caused by the end of an AST. The government’s statistical release states: “Affordability [of housing] is an increasingly significant issue, as more households facing the end of a private tenancy are unable to find an alternative without assistance.” Bob Blackman, a Tory backbencher who has drawn up a private member’s bill seeking to require councils to do more to help households at risk of losing their homes, said: “It is a national disgrace when we have the highest number of people in employment ever, we have a low rate of unemployment, that we still have people sleeping rough. Goodness knows what will happen if there is a recession.”

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Not if and when the present political climate perseveres.

Brexit Is A ‘Once-in-a-Generation’ Chance To Save UK’s WIldlife (Ind.)

Brexit will be a “once-in-a-generation chance” to reverse the huge decline in Britain’s wildlife, according to four of the UK’s leading environmental groups. The RSPB, WWF UK, National Trust and The Wildlife Trusts said the British countryside was “key to our identity as a nation” and farmers had the ability address the “urgent challenge of restoring nature”. They called on the Government to replace the much-criticised EU Common Agricultural Policy subsidy system with a British one that pays farmers to maintain “high environmental standards”. Earlier this month, the State of Nature 2016 report – produced by more than 50 organisations – concluded the UK was one of the “most nature-depleted countries in the world”. More than one in seven species face extinction and more than half are in decline.

However, in its response to the conservation groups’ call, the Government insisted the natural environment was “cleaner and healthier than at any time since the industrial revolution”. The National Farmers Union (NFU) said its members understood “the importance of protecting the environment” and complained that some organisations were making suggestions about agricultural policy “without speaking to those the policy most affects”. In a joint statement, called A new policy for our countryside, the four conservation groups said the UK’s departure from the EU “will be one of the most defining events for farming and our environment in living memory”. “[It] provides an unprecedented opportunity to revitalise our countryside in a way that balances the needs of everyone, for generations to come,” they said.

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We have created far too great a distance between ourselves and the world that gives us life.

Bees Added To US Endangered Species List For The First Time (G.)

Seven types of bees once found in abundance in Hawaii have become the first bees to be added to the US federal list of endangered and threatened species. The listing decision, published on Friday in the Federal Register, classifies seven varieties of yellow-faced or masked bees as endangered, due to such factors as habitat loss, wildfires and the invasion of non-native plants and insects. The bees, so named for yellow-to-white facial markings, once crowded Hawaii and Maui but recent surveys found their populations have plunged in the same fashion as other types of wild bees – and some commercial ones – elsewhere in the United States, federal wildlife managers said.

Placing yellow-faced bees under federal safeguards comes just over a week since the US Fish and Wildlife Service proposed adding the imperilled rusty patched bumble bee, a prized but vanishing pollinator once found in the upper midwest and north-eastern United States, to the endangered and threatened species list. One of several wild bee species seen declining over the past two decades, the rusty patched bumble bee is the first in the continental United States formally proposed for protections. The listing of the Hawaii species followed years of study by the conservation group Xerces Society, state government officials and independent researchers. The Xerces Society said its goal was to protect nature’s pollinators and invertebrates, which play a vital role in the health of the overall ecosystem.

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Nice, but that’s just a few of them. I think we’re going to end up sending our armies, our children and grandchildren, to Africa and far beyond, to the oceans, to try and keep alive enough of what preceded us on this planet in order to guarantee our own species can survive. But I can’t say I have high hopes.

Elephants Have Learned To Avoid Poachers By Hanging Out With Rangers (Konbini)

In an effort to protect diminishing elephant herds in the Democratic Republic of Congo’s Virunga National Park, a Kenyan conservation group fitted elephants with collars so they could monitor and track them in real time. Save the Elephants claim some of the herds they track have started changing their behavior to avoid dangerous areas, which the team believes is an adaptation to poaching. “Several elephant families [were seen] clustered around ranger posts, suggesting they had learned to distinguish the heavily armed rangers as harmless,” STE founder Iain Douglas-Hamilton said. In one rebel-afflicted area, elephants had even started hanging out at ranger checkpoints where huge trucks of charcoal and hardwood rumble through every few minutes.

“Yet somehow the elephants sensed that they were safe there and walked close to the voluble rangers.” Elephants that are able to distinguish rangers from poachers represent an incredible feat of animal ingenuity, but according to experts, it’s all quite understandable. According to My Green World, these mammals are similar to gorillas, in that they’re “smart, sensitive, loyal and aware.” But while this is great news for elephants (and bad news for outsmarted poachers), there’s still the matter of curbing the ongoing colossal hunting epidemic. Africa had 1.3 million elephants in the 1970s, but today there are only 500,000. So there is still quite a way to go before elephants can be taken off the endangered species list.

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Sep 012016
 
 September 1, 2016  Posted by at 9:31 am Finance Tagged with: , , , , , , , , , ,  


F.A. Loumis, Independence (Bastille?!) Day 1906

Collapse of Hanjin, World’s 7th-Biggest Shipping Line, Upsets Global Trade (R.)
Investors Miss Out On $500 Billion As Global Bond Yields Plunge (CNBC)
In Case Of Recession, The Fed Might ‘Need’ To Cut Rates To Minus 2% (CNBC)
Eurozone Core Inflation Fall Raises Prospect Of ECB Stimulus Measures (G.)
Bank of Japan Has an $84 Billion Yen Gap in Balance Sheet (BBG)
Admitting Ignorance Is Better Than Groupthink For Central Bankers (BBG)
An 809% Debt Ratio And Investors Are Serene? It Must Be China (BBG)
Austria Says Will Start ‘Conflict’ In EU About Canada Trade Deal (R.)
Apple Travesty Is A Reminder Why Britain Must Leave The Lawless EU (AEP)
UK Defined Benefit Pension Fund Deficit Grows By £100 Billion In A Month (G.)
London’s Elite ‘Pushed Out Of Exclusive Postcodes By Super Rich’ (G.)
A Third Of Africa’s Elephants Were Wiped Out In Just 7 Years (CNN)

 

 

Excellent. We’re far too independent on the idiocy of 10,000 mile shipping lines. They’re heavily polluting (in more ways than one) and entirely unnecessary.

Collapse of Hanjin, World’s 7th-Biggest Shipping Line, Upsets Global Trade (R.)

The collapse of South Korea’s Hanjin Shipping sent ripples though global trade on Thursday, as the country’s largest port turned away its ships and as some manufacturers scrambled for freight alternatives. Hanjin on Wednesday filed for court receivership after its banks decided to end financial support, and ports from China to Spain, the United States and Canada have refused entry to Hanjin vessels in what is traditionally the industry’s busiest season ahead of the year-end holidays. An official with Hanjin Shipping in Busan confirmed that its vessels were not entering the southern city’s port as container lashing providers deny service on concerns that they will not be paid. The company was also worried that the ships may be seized by creditors.

LG Electronics, the world’s No.2 maker of TVs, told Reuters it was cancelling orders with Hanjin and was seeking alternatives to ship its freight. An executive at the Korea International Freight Forwarders Association said on Wednesday he had been inundated with calls from cargo owners worried about the fate of their shipments in transit to the United States and Europe. While mobile phones and semiconductors are carried by air, other electronics like home appliances are shipped by sea. “This will have an impact on the entire industry,” the official said.

South Korea’s maritime ministry said on Wednesday that Hanjin’s woes would affect cargo exports for two or three months, with about 540,000 TEU of cargo already loaded on Hanjin vessels and facing delays. It would be difficult to find alternative ships given high seasonal demand from August to October. The ministry said it would ask local rival Hyundai Merchant Marine to supply vessels to cover some of Hanjin’s routes to the United States and Europe, while also seeking help from overseas carriers.

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How central bankers kill pensions.

Investors Miss Out On $500 Billion As Global Bond Yields Plunge (CNBC)

Investors have seen their interest income squeezed as global bond yields plunge. On the flipside, governments aren’t complaining. Relative to yields in 2011, global investors are foregoing more than $500 billion in annual income on roughly $38 trillion in sovereign debt that is outstanding, Fitch Ratings said in a report on Wednesday. “Cash flow benefits have effectively been transferred from global investors to sovereign issuers, as sovereign borrowing costs have dropped in response to central bank monetary stimulus,” Fitch said in the report. “This has posed new challenges for income-reliant investors, such as insurers and pension funds, while enabling governments to borrow at increasingly attractive rates.”

Borrowers would realize benefits only slowly, however, as bonds with higher coupon rates matured and newer bonds with lower interest rates were issued, the rating agency said. According to Fitch, investors who tended to buy assets and hold them onto maturity would have to invest new cash in bonds that paid lower interest rates, blunting the money they earned from coupon payments. Government bond yields, which move inversely to prices, have plummeted around the world as central banks in many developed economies scooped up bonds in order to provide stimulus to their economies. These purchases have sparked a scramble for government debt, enabling many countries to flog bonds while cutting the interest rates they have to pay to lure investors.

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In itself a reasonable argumant re the history of spreads, but that does not make the conclusion alright, or logical.

In Case Of Recession, The Fed Might ‘Need’ To Cut Rates To Minus 2% (CNBC)

The U.S. Federal Reserve might need to cut interest rates to as low as negative 2%, far lower than levels other global central banks have tested, a former Fed economist said. That’s what would likely be needed to engineer a recovery if the U.S. economy were to fall into a recession in the next couple of years, Marvin Goodfriend, who was an economist and policy advisor at the Federal Reserve’s Bank of Richmond from 1993-2005, told CNBC’s “Squawk Box” on Thursday. Goodfriend, who is currently a professor of economics at Carnegie Mellon University, pointed to data on the eight recessions in the U.S. since 1960.

“In eight of those recessions, the Fed had to push the short rate 2.5 percentage points below the long term rate. Today, the 10-year rate in the U.S. is 1.5%,” he noted, saying that would indicate that during the next recession, the Fed would need to cut rates as low as minus 1% at a minimum. “In five of those recessions, the Fed had to push the federal funds rate 3.5 percentage points below the 10-year bond rate,” he said. “So if that happens this time around, we would have to push the federal funds rate to minus 2%.” That’s well below where any other central banks have ventured so far. Sweden’s central bank, an early adopter of negative rates, has set its benchmark at negative 0.5%.

The Bank of Japan’s rate was set at minus 0.1% earlier this year, while the ECB, which first moved its rates into negative territory in 2014, currently has a deposit rate of negative 0.4%. The Fed funds rate has remained in positive territory, with the U.S. central bank last increasing interest rates in December of 2015, its first hike since 2006. That raised the Fed’s target rate to a range of 0.25 to 0.5%. To be sure, Goodfriend didn’t expect the Fed would be headed there anytime soon, noting that he believed the central bank should actually raise rates before the end of the year.

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More more more.

Eurozone Core Inflation Fall Raises Prospect Of ECB Stimulus Measures (G.)

Speculation is growing that the European Central Bank could take action to stimulate the eurozone economy after official figures showed an easing in underlying inflation last month. Pressure on the ECB increased when the European commission’s statistical agency, Eurostat, published figures that showed core inflation in July was lower than in same month last year, despite aggressive action by the Frankfurt-based bank over the past 18 months. With concerns that the eurozone recovery was losing momentum, Eurostat said the headline rate of inflation remained unchanged at 0.2% in August. Core, or underlying inflation, which excludes energy, goods, alcohol and tobacco, fell from 0.9% in July to 0.8%.

Separate Eurostat data showed that eurozone unemployment was unchanged at 10.1% in July, the latest month for which figures are available for all 19 countries that use the euro. The jobless rate in the eurozone has fallen from 10.8% over the past year, but financial markets had been expecting the reduction to continue to 10% last month. The ECB has been using negative interest rates and quantitative easing in an attempt to increase activity and push inflation back towards its target of just below 2%. Analysts said the inflation and unemployment figures would be discussed when the ECB meets to discuss policy options next week.

Stephen Brown of consultancy Capital Economics said: “The unchanged headline inflation rate in August highlights the fact that price pressures in the eurozone remain weak and boosts the case for more monetary easing from the ECB. “With [the] survey data also pointing to a marked slowdown in growth ahead, there is a strong case for the ECB to announce further policy easing. This could come as soon as the bank’s meeting next week.”

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Abe and Kuroda won’t even take it serious.

Bank of Japan Has an $84 Billion Yen Gap in Balance Sheet (BBG)

There’s an 8.7 trillion yen ($84 billion) gap between the value of government bond holdings on the Bank of Japan’s balance sheet and their face value. While not an immediate problem because the BOJ’s income can cover the losses, the widening gap raises questions about the sustainability of the central bank’s bond purchases, which Governor Haruhiko Kuroda has said could be expanded. The costs of the central bank’s record stimulus are mounting, while its chief goal – spurring inflation to 2% – appears as far away as it was when Kuroda took the helm in 2013. The BOJ is in the midst of reviewing its policy before a board meeting later this month, but the governor has said there will be no scaling back of his monetary program.

“These numbers show the distortions of the BOJ’s current policies,” said Sayuri Kawamura, a senior economist at the Japan Research Institute in Tokyo. “The annual amortization losses are going to increase and consume the BOJ’s profits, and the risk is increasing that the bank’s financial stability will be shaken.” The bonds the BOJ owns are worth almost 326.7 trillion yen when taken at face value, but were marked at almost 335.4 trillion yen on the balance sheet in August. That gap is 42% bigger than before the introduction of negative rates in January, according to an analysis of the balance sheet and list of the bonds the central bank owns. Tadaaki Kumagai, a spokesman for the central bank, said “the BOJ releases half-yearly and yearly accounts,” while declining to comment further.

The gap exists because, unlike the Federal Reserve, the BOJ counts its bond holdings at the purchase price, minus amortization costs. This number is diverging more from the face value because the central bank’s purchases and negative rate policy are pushing up prices. The face value is what the BOJ will receive when the bonds mature. At the end of the 2015 fiscal year on March 31, the gap between the two valuations was 6.4 trillion yen and the BOJ wrote down 874 billion yen, according to documents seen by Bloomberg. That was covered by the 1.29 trillion yen in coupon income the bank received that year, a situation that may not continue indefinitely.

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Groupthink is all they have.

Admitting Ignorance Is Better Than Groupthink For Central Bankers (BBG)

If the Fed’s objective last week was to put its September meeting back into play as the potential venue for a rate increase, it can claim a partial success. Prices in the futures market show traders now see about a 34% chance of a hike on Sept. 21, up from 22% two weeks ago. But you still have to go out to December before the likelihood rises above 50%. There’s a very good reason for that market skepticism. Raising rates at a time when inflation is dormant and miles away from the central bank’s 2% target seems somewhat perverse, especially when the forecast is for prices to remain subdued for many months to come:

The Jackson Hole Symposium (and let us note in passing what a great word symposium is, adding gravitas to what would otherwise be a mere conference) was an opportunity, as the event title said, to consider “Designing Resilient Monetary Policy Frameworks for the Future.” Instead, Fischer’s comment suggests it’s business as usual at the Federal Open Market Committee, with no room at present for such innovations as changing the inflation goal or targeting nominal GDP. That’s a shame. There’s a consensus that monetary policy is becoming impotent, and that governments need to step in with fiscal stimulus. But until central banks admit that their firepower is waning, politicians can continue to evade responsibility. “You can’t expect us to do the whole job,”

Christopher Sims, a Nobel Prize-winning economist from Princeton University, said at Jackson Hole last week. “Fiscal expansion can replace ineffective monetary policy at the zero lower bound. So long as the legislature has no clue of its role in these problems, nothing is going to get done. Of course, convincing them that they have a role and there is something they should be doing, especially in the U.S., may be a major task.” Finance – particularly in an era of fractional reserve banking – is essentially a confidence trick. Depositors have to be confident their money will be there when they try to withdraw it. Businesses have to be confident that the economy is on a sound footing otherwise they won’t invest and hire. Central bankers aren’t just economists and policy makers; they’re also salespeople, selling a story.

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China is a giant debt bubble.

An 809% Debt Ratio And Investors Are Serene? It Must Be China (BBG)

Prudence dictates that a compulsive shopper who runs up a hazardous amount of debt should think about cutting the credit card in half and staying home for a while. Try telling that to China’s acquisition-hungry companies.Two prime examples were on show this week when China Evergrande Group, one of the nation’s biggest developers, and Fosun International, an expanding Shanghai-based conglomerate, reported first-half earnings. The results show just how hard it is to kick the buying habit in an environment where compliant lenders stand ready to advance seemingly unlimited sums. Total borrowings at junk-rated Evergrande jumped by 28% from the end of December to 381 billion yuan ($57 billion).

That pushed the Guangzhou-based company’s ratio of net debt to shareholders’ equity to 142%, above the average 108% for China’s overleveraged property developers, according to data compiled by Bloomberg. Count Evergrande’s perpetual bonds as debt rather than equity and even that ratio starts to look benign. The total debt to common equity ratio rose to 809% at the end of June, from 582% six months earlier. The developer added about 40 billion yuan more perpetual notes during the period. So, time to rein things in somewhat?

Not a bit of it. Evergrande wants to acquire brokerage and trust companies as well as smaller rivals, Chief Executive Officer Xia Haijun told reporters in Hong Kong Tuesday. That would be on top of more than $5 billion of purchases so far this year, including building a stake in larger developer China Vanke and acquiring a chunk of Shenyang-based Shengjing Bank. First-half profit, meanwhile, fell 23% excluding property revaluations and foreign-exchange losses.The debt buildup wouldn’t be so striking if Evergrande were acquiring cash-generating assets that can help pay down borrowings. If anything, things seem to be moving in the opposite direction.

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Good. Kill that too.

Austria Says Will Start ‘Conflict’ In EU About Canada Trade Deal (R.)

Austria is ready to confront other European Union members states over its opposition to a free trade deal with Canada, Chancellor Christian Kern said, because it sees it containing many of the same problems as one being negotiated with the United States. “This will be difficult, this will be the next conflict in the EU that Austria will trigger… We must focus on making sure… we don’t shift the power balance in favor of global enterprises,” Kern told broadcaster ORF late on Wednesday. Austria opposes a proposed free trade deal with the United States, and Kern said the deal with Canada, called the Comprehensive Economic and Trade Agreement (CETA), bore many of the same problems.

Ministers from Germany and France have also called for a halt in negotitations on the EU-U.S. deal, the Transatlantic Trade and Investment Partnership (TTIP). “We will have to see where the weaknesses of (CETA) are. Many are the same as with TTIP,” Kern, a social-democrat, said, without elaborating. Kern is expected to address issues surrounding TTIP at a news conference on Friday. There are widespread concerns in Austria that the TTIP could compromise food safety standards. Kern also opposes the idea that the agreement could allow companies to challenge government policies if they feel regulations put them at a disadvantage.

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There are multiple truths in this case. In the end, though, this is about Brussels seeking to supersede member states’ sovereign law. For that, the constitutions of 27 nations should be held to the light. I would venture that what Brussels does here, and in many other fields, violates a fair number of these constitutions. And that is not legal no matter what their respective governments say or do. That’s an issue for their judicial systems. There’s a reason why the political and judicial systems have been made separate entities.

Apple Travesty Is A Reminder Why Britain Must Leave The Lawless EU (AEP)

Europe’s Competition Directorate commands the shock troops of the EU power structure. Ensconced in its fortress at Place Madou, it can dispatch swat teams on corporate dawn raids across Europe without a search warrant. It operates outside the normal judicial control that we take for granted in a developed democracy. The US Justice Department could never dream of acting in such a fashion. Known as ‘DG Comp’, it acts as judge, jury, and executioner, and can in effect impose fines large enough to constitute criminal sanctions, but without the due process protection of criminal law. It misused evidence so badly in pursuit of the US chipmaker Intel that the company alleged a violation of human rights. Apple is just the latest of the great US digital companies to face this Star Chamber.

It has vowed to appeal the monster €13bn fine handed down from Brussels this week for violation of EU state aid rules, but the only recourse is the European Court of Justice. This is usually a forlorn ritual. The ECJ is a political body, the enforcer of the EU’s teleological doctrines. It ratifies executive power. We can mostly agree that Apple, Google, Starbucks, and others have gamed the international system, finding legal loopholes to whittle down their tax liabilities and enrich shareholders at the expense of society. It is such moral conduct that has driven wealth inequality to alarming levels, and provoked a potent backlash against globalisation. But the ‘Double Irish’ or the ‘Dutch Sandwich’ and other such tax avoidance schemes are being phased out systematically by the G20 and by a series of tightening rules from the OECD.

The global machinery of “profit shifting” will face a new regime by 2018. We can agree too that Apple’s cosy EU arrangements should never have been permitted. It paid the standard 12.5pc corporate tax on its Irish earnings – and is the country biggest taxpayers – but the Commission alleges that its effective rate of tax on broader earnings in 2014 was 0.005pc, achieved by shuffling profits into a special ‘stateless company’ with its headquarters in Ireland. “The profits did not have any factual or economic justification. The “head office” had no employees, no premises and no real activities,” said Margrethe Vestager, the EU competition chief.

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Someone will find a way to blame this on Brexit.

UK Defined Benefit Pension Fund Deficit Grows By £100 Billion In A Month (G.)

The combined deficit of the UK’s 6,000 defined benefit pension funds has grown by £100bn in the last month, bringing the total deficit to £710bn, according to a new report. The research, by the accountants PricewaterhouseCooper, found that the pension schemes have total assets of £1,450bn but are liable to pay out about £2,160bn in contractual promises to existing and former workers. Pension deficits have worsened since the EU referendum because companies use the interest rate on gilts, otherwise known as the yield, as the main tool in estimating how much they will have to pay out in pensions in the future. The lower the gilt yield, the more that companies have to set aside to meet their future costs.

The scale of the problems facing companies offering final salary pension schemes was underlined on Wednesday by the Yorkshire-based manufacturer Carclo, which issued a statement to the stock exchange to say that the recent increase in its pension deficit meant that a dividend payout to shareholders announced in June and due to be paid in October could not now go ahead. Carclo, which is based near Leeds and employs about 1,300 people making plastics and LED products, said in its statement: “If the corporate bond yield remains at its current low level then this will result in a significant increase in the group’s pension deficit.” It said this would have the effect of “extinguishing the company’s available distributable reserves”. The announcement immediately wiped almost 15% off the company’s share price.

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How to kill a city, Chapter 826.

London’s Elite ‘Pushed Out Of Exclusive Postcodes By Super Rich’ (G.)

London’s traditional elite, such as lawyers, architects and academics, are being pushed out of their enclaves in Mayfair, Chelsea and Hampstead by an influx of global super rich investors, causing a chain reaction of gentrification across the capital, according to research by the London School of Economics. An influx of extremely wealthy overseas buyers is leading the old elite to sell up and move from London’s most exclusive postcodes and buy in areas they previously considered undesirable, said Dr Luna Glucksberg, of the LSE’s International Inequalities Institute. This displacement of old money and affluent middle class professionals is in turn pricing neighbourhoods in south and east London out of the reach of average Londoners and threatening to push those on low incomes to the margins of the city and beyond, she added.

“The changes happening at the top end of the market are real, and although they do not affect large numbers of people directly, the ripple effects they generate do resonate across London,” Glucksberg said. “In terms of the impact on London as a whole, this represents a very different kind of ‘trickle down’ effect from what politicians across the spectrum have long argued would be the benefit of the ‘super rich moving into our city’,” said Glucksberg. “Affordability for average Londoners in the rest of the city is likely to become an even more difficult issue to solve.” The trend was contributing to dramatic house price rises in areas ranging from Battersea and Clapham to Acton, as the old elite bought property there with the significant profits – usually in the millions – made from selling up to the global uber wealthy, the researcher found.

“The study shows that the wealthy individuals and families that live in London’s most exclusive areas no longer feel able to compete at the top end of the capital’s property market,” said the researcher. “Instead they feel like they are being pushed out of elite neighbourhoods. For the first time, this elite group are buying flats for their children in areas they never would have previously considered.”

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We need the death penalty for poachers and buyers, the entire chain, not just in Africa but everywhere, also in China and Japan. If they don’t comply, no more trade and full isolation.

A Third Of Africa’s Elephants Were Wiped Out In Just 7 Years (CNN)

Scanning Botswana’s remote Linyanti swamp from the low flying chopper, elephant ecologist Mike Chase can’t hide the anxiety and dread as he sees what he has seen too many times before. “I don’t think anybody in the world has seen the number of dead elephants that I’ve seen over the last two years,” he says. From above, we spot an elephant lying on its side in the cracked river mud. From a distance it could be mistaken for a resting animal. But the acrid stench of death hits us before we even land. Up close, it is a horror. He was a magnificent bull right in his prime, 45 to 50 years old. To get at his prized ivory tusks, poachers hacked off his face. Slaughtered for their ivory, the elephants are left to rot, their carcasses dotting the dry riverbed; in just two days, we counted the remains of more than 20 elephants in a small area.

Visitors and managers at the tourist camps here are frequently alarmed by the sound of gunshots nearby. And Chase worries that if Botswana can’t protect its elephants, there’s little hope for the species as a whole. Chase, the founder of Elephants Without Borders (EWB), is the lead scientist of the Great Elephant Census, (GEC) an ambitious project to count all of Africa’s savannah elephants – from the air. Before the GEC, total elephant numbers were largely guesswork. But over the past two years, 90 scientists and 286 crew have taken to the air above 18 African countries, flying the equivalent of the distance to the moon – and a quarter of the way back – in almost 10,000 hours.

Prior to European colonization, scientists believe that Africa may have held as many as 20 million elephants; by 1979 only 1.3 million remained – and the census reveals that things have gotten far worse. According to the GEC, released Thursday in the open-access journal PeerJ, Africa’s savannah elephant population has been devastated, with just 352,271 animals in the countries surveyed – far lower than previous estimates. Three countries with significant elephant populations were not included in the study. Namibia did not release figures to the GEC, and surveys in South Sudan and the Central African Republic were postponed due to armed conflict. In seven years between 2007 and 2014, numbers plummeted by at least 30%, or 144,000 elephants.

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Jun 012016
 
 June 1, 2016  Posted by at 9:00 am Finance Tagged with: , , , , , , , , , ,  


Arthur Rothstein Steam shovels on flatcars, Cherokee County, Kansas 1936

China’s Debt Bubble Bigger Than Subprime Bubble (MW)
Yuan Tumbles As China PMI Miraculously Hugs Flatline (ZH)
Double Blow for China Banks as Fed Worry Meets June Cash Crunch (BBG)
Hong Kong April Retail Sales Fall 7.5%, 14th Straight Month (R.)
Abenomics “Death Cross” Strikes As Japan PMI Plunges To 40-Month Lows (ZH)
Pension Funds Pile on Risk Just to Get a Reasonable Return (WSJ)
Germany: Draghi v the Banks (FT)
The Most Powerful Man in Banking (WSJ)
Central Banks As Pawnbrokers Of Last Resort (M. Wolf)
Germany Considers Easing of Russia Sanctions (Spiegel)
Elephants In Tanzania Reserve Could Be Wiped Out By 2022 (AFP)
Mediterranean Death Toll Soars In First 5 Months Of 2016 (UNHCR)
Frontex Denies, Prevents Help To Refugees: Witnesses (MEE)

“The problem is that the banking sector in China has been pushing out new lending aggressively, but with slowing economic growth many loans have not gone to create more factories and jobs but to financial assets that have been leveraged to boost returns..”

China’s Debt Bubble Bigger Than Subprime Bubble (MW)

Unproductive debt in China—that is, debt that’s used to drive up asset prices—swelled in 2015, eclipsing the level seen in the U.S. in the run-up to the Great Financial Crisis, said Torsten Slok, chief international economist at Deutsche Bank, in a note to clients published Tuesday. Slok’s findings are illustrated in the chart below, where he compares the level of credit growth required in the U.S. and China to generate 1percentage point of GDP growth. (He notes that the red bar for 2015 also grew, suggesting more credit growth is now required in the U.S. to produce onepercentage point of GDP growth).

Chinese officials are partly responsible for the expansion of credit last year, analysts say, as the People’s Bank of China lessened requirements regarding the collateral lenders put up to borrow funds from the central bank, among other stimulus measures. The move was meant to spur economic growth, the pace of which slowed last year, stoking fears that it could precipitate a sharp global downturn. The world’s second-largest economy saw growth slow to 6.8% in 2015—missing the government’s target for 7% growth by a hair. In the first quarter of 2016, the country’s economy grew at an annual rate of 6.7%, its slowest pace since 2009.

It’s important to note, however, that many economists believe Chinese data overstates the strength of its economy. Over the past year, Chinese stocks, and more recently commodities like iron ore and steel rebar traded in China, have seen a series of dizzying rallies and frightening crashes as investors, emboldened by easy credit engage in speculation. “The problem is that the banking sector in China has been pushing out new lending aggressively, but with slowing economic growth many loans have not gone to create more factories and jobs but to financial assets that have been leveraged to boost returns,” Slok said.

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Everyone, US, Japan and EU too, needs that services PMI to flourish, but…

Yuan Tumbles As China PMI Miraculously Hugs Flatline (ZH)

Since May 2012, China Manufacturing PMI has miraculously stayed within a 1 point range of the knife-edge 50 level between contraction and expansion. May 2015 just printed 50.1, the same as April with New Orders weaker and business activity expectations (hope) tumbling to 4 month lows. The Steel Industry PMI collapsed from 57.3 to 50.9 with New Steel Orders collapsing from 65.6 to 52.7 – the biggest monthly drop in record. And while non-manufacturing PMI remained in ‘expansion territory at 53.1, it fell back from a brief bounce in April with employment and business expectations both weaker. For now, equity markets are unreactive but offshore Yuan is tumbling on the news, not helped by a sizable devaluation in the official fix. The magic of manufacturing data… as non-manufacturing slowly catches down…

Disappointment triggering more offshore Yuan selling… Not helped by yet another devaluation by PBOC…
*CHINA SETS YUAN FIXING AT 6.5889 VS 6.5790 DAY EARLIER
*PBOC CUTS YUAN FIXING TO LOWEST LEVEL SINCE 2011 FOR THIRD DAY

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Refinancing is becoming a major problem.

Double Blow for China Banks as Fed Worry Meets June Cash Crunch (BBG)

Shanghai’s money market is braced for higher borrowing costs as a credit-fueled economic recovery coincides with the prospect of higher U.S. interest rates in June, a month that has historically seen funding crunches in China. The overnight interbank lending rate averaged 1.99% in May, up from 1.18% a year ago, as Federal Reserve tightening weakened the yuan, spurring capital outflow pressures. That borrowing cost has climbed every June since 2011, as lenders hoard deposits ahead of quarter-end regulatory checks. The cost of fixing rates in the swap market is surging as data showed property leading a rebound in investment in the world’s second-biggest economy.

“The internal and external factors combined will certainly add pressure to the money market in June, driving interest rates higher,” said Liu Dongliang at China Merchants Bank, the nation’s sixth-largest lender. “We’re not optimistic about the bond market in the short term.” Any cash crunch would aggravate a rout in bonds that led to 190.6 billion yuan ($28.9 billion) in canceled sales this quarter, making it harder for issuers to refinance a record amount of maturing debt. The overnight money rate has been moving in tandem with the weakening currency in the past year after touching a six-year low, as estimated outflows reached $1 trillion in the past year, according to a gauge compiled by Bloomberg.

The yuan declined 1.5% in May as Federal Reserve Chair Janet Yellen said that evidence of strength in the U.S. economy means there could be an increase in borrowing costs in the coming months. The probability of Fed action in June has surged to 24% from 12% at the end of April, while the premium for China’s one-year sovereign yield over U.S. Treasuries has narrowed to a seven-week low. The People’s Bank of China has an incentive to keep monetary conditions relatively tight as it looks to control the yuan’s decline, rein in excessive lending by banks and keep a lid on inflation. The authority will create a neutral and appropriate monetary environment, it said in an article published in China Business News last week. The comments came after data showed the nation’s consumer price index maintained a 2.3% acceleration for the third month in April, a pace not seen since mid-2014.

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Mainland Chinese fail to appear.

Hong Kong April Retail Sales Fall 7.5%, 14th Straight Month (R.)

Hong Kong’s retail sales fell for the 14th successive month in April, as a drop in tourists and weak local consumption deepened the pain for retailers in the city. Retail sales in April slid 7.5% from a year earlier to HK$35.2 billion ($4.5 billion) in value terms, less than a 9.8% slump in March. In volume terms, April sales dropped 7.6%, government data showed on Tuesday. “Many types of retail outlet still recorded notable falls in sales, reflecting the continued drag from the slowdown in inbound tourism as well as the more cautious local consumer sentiment amid subpar economic conditions,” the government said in a statement.

Hong Kong is struggling with mounting economic challenges from the prospect of rising U.S. interest rates, which has stepped up capital outflows, and from China’s economic slowdown. Mainland tourists are avoiding the city amid political tensions with China and growing calls from radical activists for greater autonomy from Beijing. “The near-term outlook for retail sales will continue to depend on the performance of inbound tourism,” the government added.

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“Output tumbled at the fastest pace in 25 months and new orders are the worst since Jan 2013. This is the death cross for Abenomics..”

Abenomics “Death Cross” Strikes As Japan PMI Plunges To 40-Month Lows (ZH)

Since Abenomics was unleashed on the world (with QQE starting in April 2013), things have not worked out as the smartest men in the Japanese rooms predicted. In fact, with April’s final manufacturing PMI printing at 47.7, operating conditions in Japan worsened at the sharpest pace in 40 months… since Abe began his three arrows. Output tumbled at the fastest pace in 25 months and new orders are the worst since Jan 2013. This is the death cross for Abenomics… The weakest Japanese manufacturing PMI since the start of Abenomics…

Commenting on the Japanese Manufacturing PMI survey data, Amy Brownbill, economist at Markit, which compiles the survey, said: “The aftermaths of the earthquakes in one of Japan’s key manufacturing regions continued to weigh heavily on the manufacturing sector. Both production and new orders declined sharply midway through the second quarter of 2016. A marked fall in international demand also contributed to the drop in total new orders, as exports declined at the fastest rate since January 2013.” Flashing the “death cross” of Abenomics three arrows… As it is now clear that the massive expansion of the Bank of Japan balance sheet has done nothing… in fact worse than nothing… for the Japanese economy.

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Talk about a death cross…

Pension Funds Pile on Risk Just to Get a Reasonable Return (WSJ)

What it means to be a successful investor in 2016 can be summed up in four words: bigger gambles, lower returns. Thanks to rock-bottom interest rates in the U.S., negative rates in other parts of the world, and lackluster growth, investors are becoming increasingly creative—and embracing increasing risk—to bolster their performances. To even come close these days to what is considered a reasonably strong return of 7.5%, pension funds and other large endowments are reaching ever further into riskier investments: adding big dollops of global stocks, real estate and private-equity investments to the once-standard investment of high-grade bonds. Two decades ago, it was possible to make that kind of return just by buying and holding investment-grade bonds, according to new research.

In 1995, a portfolio made up wholly of bonds would return 7.5% a year with a likelihood that returns could vary by about 6%, according to research by Callan Associates, which advises large investors. To make a 7.5% return in 2015, Callan found, investors needed to spread money across risky assets, shrinking bonds to just 12% of the portfolio. Private equity and stocks needed to take up some three-quarters of the entire investment pool. But with the added risk, returns could vary by more than 17%. Nominal returns were used for the projections, but substituting in assumptions about real returns, adjusted for inflation, would have produced similar findings, said Jay Kloepfer, Callan’s head of capital markets research.

The amplified bets carry potential pitfalls and heftier management fees. Global stocks and private equity represent among the riskiest bets investors can make today, Mr. Kloepfer said. “Stocks are just ownership, and they can go to zero. Private equity can also go to zero,” said Mr. Kloepfer, noting bonds will almost always pay back what was borrowed, plus a coupon. “The perverse result is you need more of that to get the extra oomph.”

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How to destroy the euro from within.

Germany: Draghi v the Banks (FT)

In Dillingen an der Donau, a small town in rural Bavaria, the local Sparkasse savings bank is providing an unusual service. For customers who live a long way from a branch, it is giving out free bus tickets. And for those who cannot get to the bank at all — the old or sick, for example — it offers to send a member of staff directly to their homes to deliver small sums of cash. The Sparkasse came up with the idea to compensate for the fact that it was closing several branches as revenues dwindled due to interest rates being at a record low and customers visiting less frequently. “If your revenues are shrinking, then you have to do something about your costs,” says an official at the bank. “You have to economise.” The pressure on Germany’s army of savings banks is just one example of the increasing strains on the country’s financial system caused by the ultra-loose monetary policy of the Frankfurt-based ECB.

In a bid to jolt the eurozone’s lacklustre economy back to life , the central bank has, over the past five years, slashed interest rates to record lows and even pushed its deposit rate into negative territory. On top of this, it has launched a €1.7tn asset purchase programme, which has driven down bond yields across the continent. The measures have bought time for reform in the battered economies of southern Europe. Yet in Germany, they have met a blizzard of opposition. The country’s hawkish monetary policy establishment has always nurtured a degree of scepticism about the institution that succeeded the Bundesbank as the custodian of Germany’s monetary stability. But as savers, banks and insurers have been increasingly hurt by low interest rates — nominal yields on 10-year German bonds have fallen from about 4% in 2008 to less than 0.2% today — the criticism of the ECB has intensified.

The media has accused the central bank of fuelling a “social disaster”, while one bank has claimed that low interest rates will have deprived German households of €200bn between 2010 and the end of this year. Germany’s financial watchdog, BaFin, branded low rates a “seeping poison” for the country’s financial system. The most dramatic intervention, however, came from Wolfgang Schäuble, the hawkish finance minister, who blamed ECB president Mario Draghi for “half” the rise in support for Alternative for Germany, the rightwing, anti-immigration, anti-euro party. Mr Draghi hit back, archly noting that the ECB has a mandate “to pursue price stability for the whole of the eurozone, not only for Germany”, and argued that low borrowing costs were symptomatic of a glut in global savings for which Germany was partly to blame.

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“He’s judge and jury and everything else..”

The Most Powerful Man in Banking (WSJ)

The most important person in the banking business isn’t a banker. To most Wall Street executives, that title goes to Federal Reserve governor Daniel Tarullo, a brusque, white-haired former law professor who has come to personify Washington’s postcrisis influence over how banks do business. Mr. Tarullo heads the Fed’s Committee on Bank Supervision. On paper—and in practice for most of the previous decades—the post isn’t a hugely powerful one. But the 63-year-old took office at the Fed in 2009 at a moment of broad public support for a more aggressive tack and has pressed that advantage ever since. Financiers privately call Mr. Tarullo “the Wizard of Oz” for his behind-the-scenes sway over everything from corporate strategy to how many billions of dollars banks must maintain in capital.

Through the stress tests he championed to evaluate how banks might fare in another market shock, the Fed wields control over whether banks can raise the dividends they pay to shareholders. For a big bank in 2016, getting a stamp of approval from Mr. Tarullo is an effort consuming thousands of employees. The industry’s lawyers pore over transcripts of Mr. Tarullo’s dense speeches to grasp the meaning of every word. When Citigroup and Bank of America stumbled on the stress tests in recent years, each bank said it spent at least $100 million to correct the problems the Fed had called out. Peter Conti-Brown, a historian and author of “The Power and Independence of the Federal Reserve,” called Mr. Tarullo’s influence extraordinary. One former bank executive put a finer point on it: “He’s judge and jury and everything else,” he said.

Mr. Tarullo in an interview attributed his power to his longevity at the Fed and consensus with other regulators. And, he said, the full impact of the regulatory changes made on his watch have yet to be felt. “I think it likely that firms are going to have to change in some cases their size, in some cases their business model, and in some cases their organization,” he said. Mr. Tarullo’s influence illustrates the outsize role that government regulation now plays for banks. For most of the modern era, regulators took a more hands-off approach, monitoring the industry for abuses but stopping short of injecting themselves into bank operations. But the near collapse of the financial system in 2008 brought widespread criticism of regulators for not being more vigilant and changed the equation.

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“..governments try to make finance safer and finance exploits the support to make itself riskier.”

Central Banks As Pawnbrokers Of Last Resort (M. Wolf)

Will there be another huge financial crisis? As Hamlet said of the fall of a sparrow: “If it be now, ’tis not to come. If it be not to come, it will be now. If it be not now, yet it will come – the readiness is all.” So it is with banks. They are designed to fall. So fall they surely will. A recent book explores not only this reality but also a radical and original solution. What makes attention to this suggestion even more justified is that its author was at the heart of the monetary establishment before and during the crisis. He is Lord Mervyn King, former governor of the Bank of England. His book is called The End of Alchemy . The title is appropriate: alchemy lies at the heart of the financial system; moreover, banking was, like alchemy, a medieval idea, but one we have not as yet discarded. We must, argues Lord King, now do so.

As Lord King remarks, the alchemy is “the belief that money kept in banks can be taken out whenever depositors ask for it”. This is a confidence trick in two senses: it works if, and only if, confidence is strong; and it is fraudulent. Financial institutions make promises that, in likely states of the world, they cannot keep. In good times, this is a lucrative business. In bad times, the authorities have to come to the rescue. It is little wonder, then, that financial institutions have become so large and pay so well. Consider any large bank. It will have a wide range of long-term and risky assets on its books, mortgages and corporate loans prominent among them. It will finance these with deposits (supposedly redeemable on demand), short-term loans and longer-term loans. Perhaps 5% will be financed by equity.

What happens if lenders decide banks might not be solvent? If they are depositors or short-term lenders, they can demand their money back immediately. Without aid from the central bank, the only institution able to create money without limit, banks will fail to meet that demand. Since a generalised collapse would be economically devastating, needed support is forthcoming. Over time, this reality has created a “Red Queen’s race”: governments try to make finance safer and finance exploits the support to make itself riskier. Broadly speaking, two radical solutions are on offer. One is to force banks to fund themselves with far more equity. The other is to make banks match liquid liabilities with liquid and safe assets. The 100% reserve requirements of the “Chicago plan”, proposed during the Great Depression, is such a scheme.

If liquid, safe liabilities finance liquid, safe assets — and risk-bearing, illiquid liabilities finance illiquid, unsafe assets — alchemy disappears. Finance would be safe. Unfortunately, the end of alchemy would also end much risk-taking in the system. Lord King offers a novel alternative. Central banks would still act as lenders of last resort. But they would no longer be forced to lend against virtually any asset, since that very possibility must create moral hazard. Instead, they would agree the terms on which they would lend against assets in a crisis, including relevant haircuts, in advance. The size of these haircuts would be a “tax on alchemy”. They would be set at tough levels and could not be altered in a crisis. The central bank would have become a “pawnbroker for all seasons”.

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The US will need to pressure a lot harder to keep the sanctions going.

Germany Considers Easing of Russia Sanctions (Spiegel)

As expected, G-7 leaders reiterated their hardline approach to Moscow in the Japan summit’s closing statement. Chancellor Angela Merkel complained last Thursday that there still isn’t a stable cease-fire in Ukraine and the law pertaining to local elections in eastern Ukraine, as called for by the Minsk Protocol, still hasn’t been passed. That, she said, is why “it is not to be expected” that the West will change its approach to Russia. What Merkel didn’t say, though, is that behind the scenes, her government has long since developed concrete plans for a step-by-step easing of the sanctions against Russia and that the process could begin as early as this year. Thus far, the message has been that the trade and travel restrictions will only be lifted once all the provisions foreseen by the Minsk Protocol have been fulfilled. 100% in return for 100%.

Now, however, Berlin is prepared to make concessions to Moscow – on the condition that progress is made on the Minsk process. “My approach has always been that sanctions are not an end in themselves. When progress is made on the implementation of the Minsk Protocol, we can also then talk about easing sanctions,” says Foreign Minister Frank-Walter Steinmeier. The Chancellery also supports the new approach. Thus far, it was the Social Democrats that were particularly vocal about rapprochement with Russia. Led by Economics Minister Gabriel, the SPD is Merkel’s junior coalition partner. While Steinmeier, also a senior SPD member, has never explicitly demanded the easing of sanctions, he has long supported Russia’s return to the G-7. Merkel, by contrast, had always maintained a hard line. Now, though, the Chancellery also appears to be changing course.

[..] more and more EU member states have begun questioning the strict penalty regime, particularly given that it hasn’t always been the Russians who have blocked the Minsk process. Despite Tusk’s apparent optimism, indications are mounting that getting all 28 EU members to approve the extension of the sanctions at the end of June might not be quite so simple. Berlin has received calls from concerned government officials whose governments have become increasingly skeptical of the penalties against Russia but have thus far declined to take a public stance against them. Members of some governments, though, have very clearly indicated that they are not interested in extending the sanctions in their current stringent form. Austrian Vice Chancellor Reinhold Mitterlehner is among the skeptics as is French Economics Minister Emmanuel Macron. So too are officials from Italy, Spain, Greece and Portugal.

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Time for the death penalty?! Time to put our armies to good use?

Elephants In Tanzania Reserve Could Be Wiped Out By 2022 (AFP)

Elephants in Tanzania’s sprawling Selous Game Reserve could be wiped out within six years if poaching continues at current levels, the World Wildlife Fund warned. Tanzania’s largest nature reserve was in the 1970s home to 110,000 elephants, but today only 15,000 remain and they are threatened by “industrial-scale poaching”. The Selous “could see its elephant population decimated by 2022 if urgent measures are not taken,” the WWF said. More than 30,000 African elephants are killed by poachers every year to supply an illegal trade controlled by criminal gangs that feeds demand in the Far East. Tanzania is among the worst-affected countries with a recent census saying the country’s elephant population fell by 60% in the five years to 2014.

The Selous reserve is a tourist draw contributing an estimated $6 million (5 million euros) a year to Tanzania’s economy, according to a study commissioned by WWF and carried out by advisory firm Dalberg. It is named after Frederick Selous, a British explorer, hunter and real-life inspiration for the H. Rider Haggard character Allan Quatermain in King Solomon’s Mines. “By early 2022 we could see the last of Selous’ elephants gunned down by heavily armed and well trained criminal networks,” the report said. The 55,000-square kilometre (21,000-square mile) reserve in southern Tanzania was named a World Heritage Site by UNESCO in 1982. But it was put on a watch list in 2014 as poaching spiked, with six elephants killed every day and industrial activities including oil and gas exploration, as well as mining, threatening the delicate environment.

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The sadness just intensifies.

Mediterranean Death Toll Soars In First 5 Months Of 2016 (UNHCR)

At least 880 people are believed to have drowned last week in a spate of shipwrecks and boat capsizings on the Mediterranean, the UN Refugee Agency said today. “For so many deaths to have occurred just in a matter of days and months is shocking and shows just how truly perilous these journeys are,” said UN High Commissioner for Refugees Filippo Grandi. UNHCR told a press briefing in Geneva that the latest figures were arrived at following new information received through interviews with survivors brought ashore in Italy.

“As well as three shipwrecks that were known to us as of Sunday, we have received information from people who landed in Augusta over the weekend that 47 people were missing after a raft carrying 125 people from Libya deflated,” UNHCR spokesperson William Spindler detailed. He added that eight others were reported separately to have been lost overboard from another boat, and four deaths were reported after fire on board another. “Thus far 2016 is proving to be particularly deadly. Some 2,510 lives have been lost so far compared to 1,855 in the same period in 2015 and 57 in the first five months of 2014,” Spindler added.

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“Everything started after the EU agreement,” he said. “These people are no longer refugees to them [the authorities]. They are prisoners and are being detained. But they have left the humanitarian aspect out of the story.”

Frontex Denies, Prevents Help To Refugees: Witnesses (MEE)

Frontex denied aid to refugees including a baby and kept them floating in the sea off Greece for nearly two hours, according to aid workers. Eyewitnesses told MEE that Frontex officers prevented aid workers helping 50 people as they landed on the northern shore of the Greek island of Lesbos early on Monday. Their tactic was to take them directly into detention “without any aid, even the injured,” one aid worker said. Witnesses also told MEE that officers from the Maltese branch of the European border control police prevented a doctor tending to a baby that was “unresponsive”. In a written statement to MEE, Frontex said the crew on the Maltese ship had followed a Hellenic Coast Guard officer’s instructions and that none of the volunteers identified themselves as a doctor.

The reports come as the UN says that more than 2,500 people have died trying to make the perilous journey across the Mediterranean to Europe so far in 2016, a sharp jump from the same period last year. In the past week alone, at least 880 people are believed to have died in a series of shipwrecks – but thousands of people have also been rescued in the last seven days, with some 90 rescue operations launched. Frontex, supported by a series of national fleets and coast guards as well as several NGOs and some private volunteers, is charged with carrying out rescue operations in the Mediterranean. However, witnesses told MEE that the boat crammed with refugees was made to float out at sea until Frontex ground units came to take the passengers away in buses, after the Greek coastguard granted permission for the landing at the fishing hamlet of Skala Skiaminias on Lesbos’s north coast.

Esther Camps, from Spanish NGO Proactiva, which provides aid and rescue operations at sea, was at the scene. She said the incident took place at around 01:00 on Monday morning – the arrivals, she said, included around 10 children, as well as women who were crying out for help. “We were told to do nothing and to ‘stay away’,” she told MEE. “As they [the refugees and migrants] were disembarking, we saw there was a baby that was not making any noise. One of the officers said the baby was ‘fine’ and kept us away. We said, ‘how do you know it is OK? You are not doctors.'” Camps, who has been working with Proactiva since December, said that babies normally cry when they are brought ashore, but that in this case the child was not making any noise. MEE understands that a doctor from the aid organisation Waha was also at the scene but was denied access.


Handout photo released as courtesy by German humanitarian NGO Sea-Watch shows a crew member holding a drowned baby as dead bodies were recovered after a wooden boat transporting migrants capsized off the Libyan coast on 27 May, 2016 (AFP)

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