Aug 262025
 


Joseph-Désiré Court Le Masque 1843

 

Zelenski Rejects Giving Land As Fascists Promise To Kill Him (MoA)
Zaluzhny ‘Biding Time’ To Challenge Zelensky – Guardian (RT)
CIA’s Covert Ukraine Invasion Plan (Kit Klarenberg)
US Won’t Play Key Role In Ukraine’s Security Guarantees – Trump (RT)
The Judicial Calvinball of Justice Ketanji Brown Jackson (Turley)
Trump Fires Fed Governor Lisa Cook For “Potentially Criminal Conduct” (ZH)
War, Trump’s New $500 Note & Volcanos -Martin Armstrong (USAW)
A Lesson on Slavery for CNN (Paul Craig Roberts)
‘Godfather of AI’ Warns Superintelligent Machines Could Replace Humanity (ET)
Musk Takes On Apple, OpenAI In Antitrust Showdown Over Chatbots (ZH)
Dutch Foreign Minister Quits Over Israel (RT)
US Scientists Axe ‘Woke’ To Keep Cash Flowing – WSJ (RT)
Trump Proposes Renaming Department of Defense to Its Original Name (ET)
Giving Trump The Nobel Peace Prize Makes Some Sense (Lukyanov)
Ghislaine ‘Splainin’ (James Howard Kunstler)

 

 

https://twitter.com/GuntherEagleman/status/1959996874892378315

Scalia

 

 

 

 

“He would style himself as a tough, wartime leader who would promise “blood, sweat and tears” to the Ukrainian people in return for saving the nation..”

Ideal for warmongers.

Zelenski Rejects Giving Land As Fascists Promise To Kill Him (MoA)

The (former) President Zelenski of Ukraine is refusing any compromise in negotiations with Russia. He would be killed and replaced by a more right wing figure if he would consider otherwise. In a speech on Sunday marking Ukraine’s independence Zelenski insisted of recapturing all of Ukraine including Crimea. As the Washington Post summarizes: “In Kyiv on Sunday, Ukraine’s Independence Day, Zelensky addressed the nation and vowed to restore its territorial integrity. “Ukraine will never again be forced in history to endure the shame that the Russians call a ‘compromise,’” he said. “We need a just peace.” He listed some of the regions occupied by Russia — including Donetsk, Luhansk and Crimea — and said “no temporary occupation” could change the fact that the land belongs to Ukraine.

Zelenski thus rejects calls by U.S. President Trump to give up Ukrainian territory in exchange for peace. One reason why he does so may be the personal danger he is in. Any compromise about territory may well cost his life. The London Times continues to make propaganda for Nazis. After a recent whitewashing interview with Azov Nazi leader Biletsky (archived) it yesterday published an interview with the former leader of the fascist Right Sector in Odessa Serhii Sterneneko. Sterneneko had a leading role in the 2014 massacres in Maidan Square and at the Trade Union’s House in Odessa. The Times is whitewashing his participation in those events. It does not mind to publish his threats against Zelenski: “[A]mong Ukraine’s younger generation of soldiers and civilians, Sternenko’s brand of truth to power has wide popularity. “I say what I think, and people like what I say.”

His views on President Putin’s demand for Ukraine to cede the territory it defends in the eastern Donbas region as a precondition for possible peace are typically direct. “If [President] Zelensky were to give any unconquered land away, he would be a corpse — politically, and then for real,” Sternenko said. “It would be a bomb under our sovereignty. People would never accept it.” Sternenko, who himself has avoided the draft, wants the war to go on forever: “Indeed, as he discussed Russian intransigence and President Trump’s efforts to end the war, Sternenko’s thoughts on the possibility of peace appeared to be absent of any compromise over Ukrainian soil. “At the end there will only be one victor, Russia or Ukraine,” he said. “If the Russian empire continues to exist in this present form then it will always want to expand. Compromise is impossible. The struggle will be eternal until the moment Russia leaves Ukrainian land.”

Other British media continue to promote the rise of Nazi affiliated figures in Ukraine. The Guardian adds by promoting the presidential campaign of the former Ukrainian general and now ambassador to the UK Valeri Zaluzhny: In private conversations, Zaluzhnyi has not confirmed he plans to go into politics, but he has allowed himself to speculate on what kind of platform he could propose if he does make the decision. Those close to him say he sees Israel as a model, despite its current bloody actions in Gaza, viewing it as a small country surrounded by enemies and fully focused on defence.

He would style himself as a tough, wartime leader who would promise “blood, sweat and tears” to the Ukrainian people in return for saving the nation, channelling Winston Churchill. In one private conversation, he said: “I don’t know if the Ukrainian people will be ready for that, ready for these tough policies.” A day before being fired as the commander of the Ukrainian army Zaluzhny took a selfie with the leader of the fascist Right Sector and commander of Right Sector brigade of Ukrainian military in front of a portrait of Nazi collaborator Stepan Bandera and the fascist OUN flag.

Read more …

Musical chairs solve nothing. It would still be Azov.

Zaluzhny ‘Biding Time’ To Challenge Zelensky – Guardian (RT)

There is an “increasing belief” in Kiev that former commander-in-chief, Valery Zaluzhny, is preparing to go head-to-head with Vladimir Zelensky in a potential presidential race, The Guardian has claimed. Amid growing tensions, Ukrainian leader Zelensky removed the general from his post in February 2024 and dispatched him to the UK to serve as Kiev’s ambassador. In an article on Monday, The Guardian claimed that while Zaluzhny has painstakingly concealed any political ambition he may have, “many assume he is just biding his time before entering the fray.” The British newspaper cited the general-turned-envoy’s supposed musings as to how he would present himself to Ukrainian voters and what platform he would run on, should he decide to vie for the presidency.

The outlet further stated that Zaluzhny has been receiving a steady flow of Ukrainian and Western dignitaries at both the embassy in London and in Kiev earlier this year. The Guardian also quoted anonymous sources as saying that in March, following the infamous showdown between Zelensky and US President Donald Trump at the White House, Vice President J.D. Vance secretly reached out to Zaluzhny, in an apparent attempt to sound him out as a potential alternative leader. He reportedly turned down Vance’s overtures. Last week, freelance journalist Katie Livingstone claimed that Zaluzhny was “quietly preparing a run for president – in direct opposition to Zelensky.” She quoted an unnamed source as suggesting that his team had “effectively begun” an unofficial PR campaign.

Zaluzhny’s press representative was quick to deny the speculation. A survey of 1,000 people in Ukraine conducted July 4-5 by ‘Rating’ indicated that the former commander-in-chief was trusted by 73% of respondents. That would put him in first place among political figures in the country, with Zelensky trailing six percentage points behind, the poll suggested. Another survey by a different pollster in late June showed that 41% of Ukrainians believed the country was drifting toward authoritarianism. Zelensky’s presidential term expired in May 2024, but he has refused to hold new elections, citing martial law. The Kremlin insists that the Ukrainian leader has lost legitimacy.

Read more …

“69% of citizens “favor a negotiated end to the war as soon as possible.” Just 24% wish to keep fighting.”

CIA’s Covert Ukraine Invasion Plan (Kit Klarenberg)

On August 7th, US polling giant Gallup published the remarkable results of a survey of Ukrainians. Public support for Kiev “fighting until victory” has plummeted to a record low “across all segments” of the population, “regardless of region or demographic group.” In a “nearly complete reversal from public opinion in 2022,” 69% of citizens “favor a negotiated end to the war as soon as possible.” Just 24% wish to keep fighting. However, vanishingly few believe the proxy war will end anytime soon. The reasons for Ukrainian pessimism on this point are unstated, but an obvious explanation is the intransigence of President Volodymyr Zelensky, encouraged by his overseas backers – Britain in particular. London’s reverie of breaking up Russia into readily-exploitable chunks dates back centuries, and became turbocharged in the wake of the February 2014 Maidan coup. In July that year, a precise blueprint for the current proxy conflict was published by the Institute for Statecraft, a NATO/MI6 cutout founded by veteran British military intelligence apparatchik Chris Donnelly.

In response to the Donbass civil war, Statecraft advocated targeting Moscow with a variety of “anti-subversive measures”. This included “economic boycott, breach of diplomatic relations,” as well as “propaganda and counter-propaganda, pressure on neutrals.” The objective was to produce “armed conflict of the old-fashioned sort” with Russia, which “Britain and the West could win.” While we are now witnessing in real-time the brutal unravelling of Donnelly’s monstrous plot, Anglo-American designs of using Ukraine as a beachhead for all-out war with Moscow date back far further.

In August 1957, the CIA secretly drew up elaborate plans for an invasion of Ukraine by US special forces. It was hoped neighbourhood anti-Communist agitators would be mobilized as footsoldiers to assist in the effort. A detailed 200-page report, Resistance Factors and Special Forces Areas, set out demographic, economic, geographical, historical and political factors throughout the then-Soviet Socialist Republic that could facilitate, or impede, Washington’s quest to ignite local insurrection, and in turn the USSR’s ultimate collapse. The mission was forecast to be a delicate and difficult balancing act, as much of Ukraine’s population held “few grievances” against Russians or Communist rule, which could be exploited to foment an armed uprising.

Just as problematically, “the long history of union between Russia and Ukraine, which stretches in an almost unbroken line from 1654 to the present day,” resulted in “many Ukrainians” having “adopted the Russian way of life”. Problematically, there was thus a pronounced lack of “resistance to Soviet rule” among the population. The “great influence” of Russian culture over Ukrainians, “many influential positions” in local government being held “by Russians or Ukrainians sympathetic to [Communist] rule, and “relative similarity” of their “languages, customs, and backgrounds”, meant there were “fewer points of conflict between the Ukrainians and Russians” than in Warsaw Pact nations. Throughout those satellite states, the CIA had to varying success already recruited clandestine networks of “freedom fighters” as anti-Communist Fifth Columnists. Yet, the Agency remained keen to identify potential “resistance” actors in Ukraine:

“Some Ukrainians are apparently only slightly aware of the differences which set them apart from Russians and feel little national antagonism. Nevertheless, important grievances exist, and among other Ukrainians there is opposition to Soviet authority which often has assumed a nationalist form. Under favorable conditions, these people might be expected to assist American Special Forces in fighting against the regime.”

Read more …

But Russia will.

US Won’t Play Key Role In Ukraine’s Security Guarantees – Trump (RT)

Europe must take the lead in providing “significant security guarantees” to Ukraine, US President Donald Trump said on Monday. Washington’s role will be supportive rather than primary, he stressed. “Europe is going to give them significant security guarantees – and they should, because they’re right there,” Trump told reporters at the Oval Office. He added that Washington would remain involved “from the standpoint of backup.” This isn’t the first time Trump has clarified Washington’s role in resolving the Ukraine conflict. Speaking in the Oval Office last week with Vladimir Zelensky, Trump was asked if security guarantees for Kiev could involve US troops. We’ll let you know that maybe later today, we’re meeting with the leaders of seven great countries. There will be a lot of help. Europe is the first line of defense because they are there, but we’re going to help, we’ll be involved.

Since the talks with Zelensky Trump has also clarified that as far as Washington is concerned, Ukraine getting Crimea back and joining NATO are both “impossible.” He told Fox & Friends last Tuesday that Kiev had approached the US-led military bloc to seek help in trying to get the peninsula back. “They went in and said ‘We want to get Crimea back’. This was at the beginning,” Trump revealed. “The other thing they said was ‘We want to be a member of NATO’. Well, both of those things are impossible.” “It was always a no-no,” both during the time of the Soviet Union, and now with Russia, Trump explained, adding that Russia has always stressed it did not want “the enemy” on its border. Zelensky said on Saturday that new details of security guarantees for Ukraine would be ready “in the coming days.”

“The teams of Ukraine, the United States, and European partners” are working together on the architecture of these guarantees, he said. NATO Secretary General Mark Rutte stressed that “robust security guarantees will be essential” and claimed that Washington, despite its limited role, would remain part of the process. Zelensky and his Western European backers have called for “Article 5-like guarantees” that would obligate countries to respond collectively if Ukraine were attacked. He also proposed defining which states would be responsible for ground support, air defense, and maritime security, alongside commitments to fund Ukraine’s armed forces.

Speaking in Kiev on Friday, Rutte called for strengthening Ukraine’s military capacity and putting in place binding guarantees from Europe and the US. Some nations have even floated sending peacekeepers, while Canada has not ruled out contributing troops. Washington has rejected deploying ground forces but left open the possibility of air support. After meeting Trump earlier this month, Russian President Vladimir Putin agreed that Ukraine’s security must be ensured but warned against solutions that exclude Moscow. Russian Foreign Minister Sergey Lavrov argued that guarantees “must be subject to consensus” and denounced proposals involving foreign military intervention as “absolutely unacceptable.”

Read more …

The Supreme Court as a woke podium.

The Judicial Calvinball of Justice Ketanji Brown Jackson (Turley)

“I just feel that I have a wonderful opportunity.” Those words of Justice Ketanji Brown Jackson came in a recent interview, wherein the justice explained how she felt liberated after becoming a member of the Supreme Court “to tell people in my opinions how I feel about the issues. And that’s what I try to do.” Jackson’s sense of liberation has increasingly become the subject of consternation on the court itself, as she unloads on her colleagues in strikingly strident opinions. Most recently, Jackson went ballistic after her colleagues reversed another district court judge who issued a sweeping injunction barring the Trump Administration from canceling roughly $783 million in grants in the National Institutes of Health. Again writing alone, Jackson unleashed a tongue-lashing on her colleagues, who she suggested were unethical, unthinking cutouts for Trump.

She denounced her fellow justices, stating, “This is Calvinball jurisprudence with a twist. Calvinball has only one rule: There are no fixed rules. We seem to have two: that one, and this administration always wins.” For some of us who have followed Jackson’s interestingly controversial tenure on the court, it was crushingly ironic. Although Jackson accused her colleagues of following a new rule that they must always rule with Trump, she herself is widely viewed as the very embodiment of the actual rule of the made-up game based on the comic strip of Calvin and Hobbes. In Jacksonian jurisprudence, it often seems like there are no fixed rules, only fixed outcomes. She then attacks her colleagues for a lack of integrity or empathy. To quote Calvin, Jackson proves that “there’s no problem so awful that you can’t add some guilt to it and make it even worse.”

Jackson has attacked her colleagues in opinions, shattering traditions of civility and restraint. Her colleagues have clearly had enough. She now regularly writes diatribes that neither of her fellow liberals — Justices Sonia Sotomayor or Elena Kagan — are willing to sign on to. Indeed, she has raged against opinions that her liberal colleagues have joined. Take Stanley v. City of Sanford. Justices Jackson and Neil Gorsuch took some fierce swings at each other in a case concerning a retired firefighter who wants to sue her former employer. The majority, including Kagan, rejected a ridiculous claim from a Florida firefighter who sued for discrimination for a position that she had neither held nor sought.

The court ruled that the language of the statute clearly required plaintiffs to be “qualified” for a given position before they could claim to have been denied it due to discrimination. (Stanley has Parkinson’s disease and had taken a disability retirement at age 47 due to the progress of the disease.) Jackson, however, was irate that Stanley could not sue for the denial of a position that she never sought, held, or was qualified to perform. Jackson accused the majority of once again showing how “pure textualists can easily disguise their own preferences as ‘textual’ inevitabilities.” It was not only deeply insulting, but perfectly bizarre, given that Kagan had joined in the majority opinion. Kagan is about as pure a textualist judge as she is a pure taxidermist.

Read more …

“Good luck with that plan when the FBI turns up tomorrow at your place of work.”

Trump Fires Fed Governor Lisa Cook For “Potentially Criminal Conduct” (ZH)

Update (2330ET): Former Fed governor Lisa Cook says she will not resign, the Washington Post reports, citing a statement from Cook. “President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” Cook said through a spokeswoman: WaPo “I will continue to carry out my duties to help the American economy as I have been doing since 2022,” Cook said. Good luck with that plan when the FBI turns up tomorrow at your place of work.
* * *
Promises made… promises kept… On Friday, President Trump warned that he would fire Federal Reserve Governor Lisa Cook who allegedly “falsified bank documents and property records to acquire more favorable loan terms” if she didn’t resign… She immediately played the victim card, claiming she “would not be bullied”. But now that is moot as President Trump has fired her, effective immediately: ” I have determined that there is sufficient cause to remove you from your position…

The Federal Reserve has tremendous responsibility for setting interest rates and regulating reserve and member banks. The American people must be able to have full confidence in the honesty of the members entrusted with setting policy and overseeing the Federal Reserve. In light of your deceitful and potentially criminal conduct in a financial matter, they cannot and I do not have such confidence in your integrity. At a minimum, the conduct at issue exhibits the sort of gross negligence in financial transactions that calls into question your competence and trustworthiness as a financial regulator.”

Read more …

“Everybody else is cancelling currency and putting in capital controls, and Trump is going in the opposite direction.”

“I still want to have one of those $500 notes.”

War, Trump’s New $500 Note & Volcanos -Martin Armstrong (USAW)

Five weeks ago, legendary financial and geopolitical cycle analyst Martin Armstrong warned his “Socrates” predictive computer program showed a “100% Chance of Nuclear War.” After that, Trump was able to get Putin to Alaska to start meaningful peace talks between Russia and Ukraine. The chance for war is still 100%, but now, that war may not involve America. Armstrong explains, “My sources in Ukraine are telling me the losses on the battlefield are approaching 1.8 million, 5 million fled to Russia, 8 million fled to the EU. . .. Ukraine is about ready to fall apart. . .. I spread this to Washington and that is President Zelensky was sending $50 million per month to UAE. So, Zelensky has been preparing to leave. There is no way this guy could possibly retire in Ukraine. They will kill him.”

Does this mean the war may be over? Zelensky and nearly all of Europe’s leaders came to Washington recently to meet with President Trump, but it really was not to talk peace. Armstrong says, “The fact that all those leaders came to Washington—uninvited, they all met with Zelensky before they went to meet with Trump. Why did they come? Because they need war. I have warned Washington.” So, if Europe starts a wider war with Russia, will Trump stay out of it? Armstrong says, “Yes, Trump said no American troops from what I have been told. Trump refuses to send any American troops to Ukraine as peacekeepers—period.”

Reading between the lines, does this mean Trump is putting the EU on notice we are not going to Article 5 in if you start a war? Armstrong says, “Article 5 is voluntary. I have made this very clear to them in Washington. You don’t have to participate. . .. I can’t stop the war. The best I can do is reduce the amplitude. If I can keep America out of this war, that is our best outcome. . .. Europe knows it’s in trouble financially. They have $335 billion of Russian assets frozen. France has about $71 billion. . .. The rumor going around right now is if there is a peace deal and they have to release those frozen assets, France can’t because they have been dipping into them. Europe is a complete mess. When it comes down to handing back $335 billion in Russian assets, I am not sure Europe is prepared to do that.”

Armstrong says forget all the talk of the elite wanting to get rid of cash and replace it with digital currency. Armstrong says, “No, no, no. Why is Trump talking about a $500 note. . .. Trump would not even contemplate doing a $500 bill if he was going to cancel the currency. Everybody else is cancelling currency and putting in capital controls, and Trump is going in the opposite direction. . .. Gold is still projected to go much higher because it is anticipating war.”

One of the surprising things Armstrong brought up are new signals from “Socrates” on increasing volcanic activity all over the world. Hawaii’s Kilauea eruption happened for the 31st time since December on Friday. It spewed lava for 12 hours, and then there was the recent eruption in Northeast Russia that had a huge eruption after 600 years of lying dormant. Armstrong says, “We have every data base in there. Earthquakes, volcanos and temperatures back to 1869 from New York City. It does not show global warming. . .. The computer says we are heading to global cooling and not global warming. . .. The computer is showing from 2025 on, we are going to be seeing a lot more volcanic activity. I just got off the phone with someone from Italy, and they say the super volcano there is starting to become active.”

In closing, Armstrong says, “I still want to have one of those $500 notes.”]

Read more …

“The black King of Dahomey.”

A Lesson on Slavery for CNN (Paul Craig Roberts)

The saga of American slavery has more holes in it than the Zionist saga of the Holocaust. Recently President Trump wondered about the woke Smithsonian Institute’s fixation on slavery as if it was the principal problem the world faces today. The liberal media had a hissy fit. CNN rushed to do a program on slavery, the woke rectification for which is multiculturalism and the replacement of the white racist population by people of color. This is the political agenda of the Democrat Party. To watch white people so determined to achieve their own destruction by voting Democrat is amazing. The response made by those critical of CNN’s attack on white Americans was that slavery was a matter of the distant past, and we made amends for our responsibility in a civil war.

What nonsense. No American ever had any responsibility for slavery. The black King of Dahomey did. Here are the undeniable, indisputable, basic facts: Over the course of history far more white people have been slaves than blacks. Some of these white slaves were held by Romans and other conquerors in ancient times. Most were held by people of color who raided Europe’s Mediterranean coast for slaves. Thomas Jefferson, the third president of the US (1801-1809) had to send the US Navy and Marines to “the shores of Tripoli” to stop the North Africans from capturing American ships and enslaving their passengers and crews. In the New World (Caribbean Islands, North and South America) European colonists found abundant resources but no labor force.

British and European sea captains saw a business opportunity in purchasing slaves from the black King of Dahomey and selling them to the colonists as a labor force. The black King of Dahomey conducted annual slave wars against other blacks and sold the surplus to Arabs and to European sea captains. No white colonist in what later became the United States ever enslaved a black person. They purchased blacks already enslaved by the black King of Dahomey. When the United States came into existence in the late 18th century, slavery was an inherited institution. Slavery existed as the labor force for large agricultural plantations, the agri-businesses of the time. The plantations using slave labor did not enslave the slaves. They purchased already enslaved labor as no work force was available.

In the United States slavery was doomed as the frontier closed. Slavery had a long life because white immigrants who entered America could avoid becoming agricultural labor by moving west and occupying land to which the native Americans had use rights but not ownership rights as understood in Western law. Thus the native inhabitants could be dispossessed. As the constant stream of immigrant-invaders, such as the US and Europe are experiencing today, continued, the Indian lands were settled by the immigrant-invaders and the frontier closed by 1890. Slavery could not have existed beyond that date and, in fact, could not have lasted that long. Slavery was costly compared to the wages of free labor.

Slavery was an expensive labor force. In 19th century America a male field hand cost $1,500. If a slave had blacksmith or carpenter skills, he cost $2,000. The price of a slave was three to four times the annual income of a skilled white man such as a blacksmith. Moreover, a slave, if he was to be productive, needed sufficient food, housing, and medical care. Moreover, he required respect and appreciation, Many of the slaves were warriors captured in the black King of Dahomey’s slave wars. They were experienced fighters and had to be treated with respect. For a white plantation owner to be surrounded by a large number of black men and for him to expect them to work required his respect and proper treatment of his labor force in which he had a large investment.

Propaganda such as Uncle Tom’s Cabin was northern war propaganda against the South. A few issues back, the City Journal posed the question of who was in charge of a rice or sugar plantation in the Caribbean when the one white owner, the only white on the premises, had a work force of 50 black men. The idea that it was customary to whip black warriors and to rape their wives is farfetched.

Read more …

“Making God”

‘Godfather of AI’ Warns Superintelligent Machines Could Replace Humanity (ET)

Geoffrey Hinton, the pioneering computer scientist called the “godfather of AI,” has once again sounded the alarm that the very technology he helped bring to life could spell the end of humanity as we know it. In an interview clip released Aug. 18 as part of the forthcoming film “Making God,” Hinton delivered one of his starkest warnings yet. He said that humanity risks being sidelined—and eventually replaced—by machines far smarter than ourselves. “Most people aren’t able to comprehend the idea of things more intelligent than us,” Hinton, a Nobel Prize winner for physics and a former Google executive, said in the clip. “They always think, ‘Well, how are we going to use this thing?’ They don’t think, ‘Well, how’s it going to use us?’”

Hinton said he is “fairly confident” that artificial intelligence will drive massive unemployment, pointing to early examples of tech giants such as Microsoft replacing junior programmers with AI. But the larger danger, he said, goes far beyond the workplace. The only silver lining is that “it won’t eat us, because it’ll be made of silicon,” he said. Hinton, 77, has spent decades pioneering deep learning, the neural network architecture that underpins today’s artificial intelligence systems. His breakthroughs in the 1980s—particularly the invention of the Boltzmann machine, which could learn to recognize patterns in data—helped open the door to image recognition and modern machine learning.

That work earned him the 2024 Nobel Prize in Physics, awarded “for foundational discoveries and inventions that enable machine learning with artificial neural networks.” The Royal Swedish Academy of Sciences noted how Hinton’s early use of statistical physics provided the conceptual leap that made today’s AI revolution possible. But Hinton has since emerged as one of the field’s fiercest critics, warning that its rapid development has outpaced society’s ability to keep it safe. In 2023, he resigned from his role at Google so he could speak freely about the risks without implicating the company. In his Nobel lecture, Hinton acknowledged the potential benefits of AI—such as productivity gains and new medical treatments that could be a “wonderful advance for all humanity.” Yet he also warned that creating digital beings more intelligent than humans poses an “existential threat.”

“I wish I’d thought about safety issues too,” he said during the recent Ai4 conference in Las Vegas, reflecting on his career. He noted that he now regrets solely focusing on making AI work, rather than anticipating its risks. Hinton has previously estimated that there is a 10 percent to 20 percent chance that AI could wipe out humanity. In a June episode of The Diary of a CEO podcast, he said that the engineers behind today’s AI systems don’t fully understand the technology and broadly fall into two camps: one that believes in a dystopian future where humans are displaced, and the other that dismisses such fears as science fiction. “I think both of those positions are extreme,” Hinton said. “I often say 10 percent to 20 percent chance [for AI] to wipe us out. But that’s just gut, based on the idea that we’re still making them and we’re pretty ingenious. And the hope is that if enough smart people do enough research with enough resources, we’ll figure out a way to build them so they’ll never want to harm us.”

Read more …

“If not for its exclusive deal with OpenAI, Apple would have no reason to refrain from more prominently featuring the X app and the Grok app in its App Store.”

Musk Takes On Apple, OpenAI In Antitrust Showdown Over Chatbots (ZH)

Elon Musk’s X and xAI have filed a federal lawsuit in Fort Worth, Texas, accusing Apple and OpenAI of “locking up markets” to preserve their monopolies and shut out rivals. This comes as Musk’s long-running feud with OpenAI chief Sam Altman intensifies. The lawsuit centers on Apple’s recent deal to make OpenAI’s ChatGPT the only generative AI chatbot on the iPhone’s operating system, effectively shutting out xAI’s Grok and other rivals, such as Google’s Gemini and Anthropic. The lawsuit’s introduction argues that Apple and OpenAI have teamed up to protect their monopolies in smartphones and AI chatbots:

“This is a tale of two monopolists joining forces to ensure their continued dominance in a world rapidly driven by the most powerful technology humanity has ever created: artificial intelligence (“AI”). Working in tandem, Defendants Apple and OpenAI have locked up markets to maintain their monopolies and prevent innovators like X and xAI from competing.1 Plaintiffs bring this suit to stop Defendants from perpetrating their anticompetitive scheme and to recover billions in damages. AI is fundamentally reshaping our world. Technology powered by AI has not only become embedded in our daily lives but is also transforming critical sectors like healthcare, education, and finance.

The consensus among global business leaders, academics, and scientists is that AI adoption is both unavoidable and transformational—and businesses that do not plan for it risk falling behind. As Apple now recognizes, AI poses an existential threat to its business. For example, AI is rapidly advancing the rise of “super apps”—i.e., multi-functional platforms that offer many of the services of smartphones, such as social connectivity and messaging, financial services, e-commerce, and entertainment—that do not require a customer to be tied to a particular device. In other words, super apps, like those being developed by X and xAI, stand ready to upend the smartphone market and Apple’s entrenched monopoly in it.

The writing is on the wall. Apple’s Senior Vice President for Services, Eddy Cue, has expressed worries that AI might destroy Apple’s smartphone business, just as Apple’s iPhone did to Nokia’s handsets. Apple knows it cannot escape the inevitable—at least not alone. In a desperate bid to protect its smartphone monopoly, Apple has joined forces with the company that most benefits from inhibiting competition and innovation in AI: OpenAI, a monopolist in the market for generative AI chatbots. OpenAI quickly rose to dominance in the generative AI chatbot market after introducing its flagship service, ChatGPT, in 2022. Today, OpenAI controls at least 80 percent of the market. Because of OpenAI’s monopoly, other generative AI chatbots have struggled to gain share. xAI’s Grok has yet to gain more than a few percent of the market despite accolades about its superior features.

Just like Apple, OpenAI has incentive to protect its monopoly by thwarting competition and innovation in the generative AI chatbot market. And just like Apple, it has done so in violation of the antitrust laws.

In June 2024, Apple and OpenAI announced that Apple would integrate OpenAI’s ChatGPT into Apple’s iPhone operating system (“iOS”). Apple and OpenAI’s exclusive arrangement has made ChatGPT the only generative AI chatbot integrated into the iPhone. This means that if iPhone users want to use a generative AI chatbot for key tasks on their devices, they have no choice but to use ChatGPT, even if they would prefer to use more innovative and imaginative products like xAI’s Grok. An OpenAI strategy document recognized the importance of competition in this emerging and transformational space: “Real choice drives competition and benefits everyone. Users should be able to pick their AI assistant.” Yet Apple and OpenAI have colluded to prevent exactly that.”

X and xAI argue: “If not for its exclusive deal with OpenAI, Apple would have no reason to refrain from more prominently featuring the X app and the Grok app in its App Store.” Just a few weeks ago, Musk threatened Apple with legal action over alleged antitrust violations regarding the App Store rankings of the Grok AI chatbot. He wrote in an X post that Apple’s behavior “makes it impossible for any AI company besides OpenAI to reach #1 in the App Store.” Musk is seeking an injunction to block Apple and OpenAI’s exclusive chatbot deal and billions in damages. If successful, the case could reshape how AI bots are distributed on smartphones.

Read more …

“Veldkamp, who previously served as Dutch ambassador to Israel, had advocated a ban on imports from Israeli settlements in occupied Palestinian territories..”

Dutch Foreign Minister Quits Over Israel (RT)

Dutch Foreign Minister Caspar Veldkamp has stepped down in protest over the coalition government’s refusal to impose sanctions on Israel for its actions in Gaza. The resignation of Veldkamp, along with the country’s Minister for Foreign Trade Hanneke Boerma, has reduced the Dutch caretaker government to holding just 32 out of 150 seats. In a statement on Saturday the foreign ministry said that “after a meeting of the cabinet on the situation in Gaza,” the Social Contract (NSC) party, of which both officials are members, decided to withdraw from the caretaker coalition government.Veldkamp, who previously served as Dutch ambassador to Israel, had advocated a ban on imports from Israeli settlements in occupied Palestinian territories in response to Israel’s continued military offensive in Gaza.

In a statement on its website on Friday, the party said that it had sought “additional measures” against Israel in light of the “increasingly deteriorating humanitarian situation in Gaza.” However, the other two coalition partners refused to back sanctions, prompting the NSC to pull out in protest. On Thursday, the Netherlands, along with 20 other nations, signed a joint declaration condemning Israeli plans to build an illegal settlement in the occupied West Bank. Last month, Amsterdam declared two hardline Israeli ministers persona non grata. Back in June, Spanish Foreign Minister Jose Manuel Albares called on the EU to “immediately suspend” the EU-Israel association agreement and impose a ban on arms sales to Israel.

In light of the ongoing Israeli military operation in Gaza, a growing number of traditionally pro-Israel Western countries, including France and the UK, have expressed in recent months a readiness to officially recognize Palestinian statehood. Earlier this week, the Israel Defense Forces (IDF) announced the start of an operation to take full control of Gaza City. The conflict erupted after a Hamas incursion into southern Israel on October 7, 2023, which left about 1,200 people dead and 250 taken hostage. According to Gaza’s Hamas-controlled Health Ministry, more than 62,000 people, most of them civilians, have been killed by Israeli strikes in the enclave since then.

Read more …

They’e playing politics. But what do they think?

US Scientists Axe ‘Woke’ To Keep Cash Flowing – WSJ (RT)

Researchers in the US have been revising their grant renewal applications en masse in recent months over fears that wording tied to diversity, equity and inclusion (DEI) initiatives could cost them government funding, the Wall Street Journal reported on Saturday Since taking office in January, US President Donald Trump, a long-time critic of what he views as “divisive” leftist narratives, has taken numerous steps to eradicate such policies and even associated language at the government level. Promoted by his predecessor Democrat Joe Biden, DEI programs sought to ensure that sexual and racial minorities were better represented in government agencies. The Trump administration has described the initiatives as “illegal and immoral discrimination.”

The WSJ wrote that at least 600 grant renewal applications since October 2024 had removed “terms associated with diversity, equity and inclusion,” such as “diverse,” “underrepresented,” and “disparities.” The outlet said it had reviewed thousands of applications for National Institutes of Health-funded projects in the fiscal years 2024 and 2025. Some scientists have also reportedly shifted the focus of studies that were originally centered on minority groups. A Johns Hopkins University spokesperson confirmed to the WSJ that “federal agencies have asked researchers to make modest modifications” before renewing grants. On his first day in office, Trump signed an executive order mandating a review of government DEI initiatives.

Addressing a joint session of Congress in March, Trump declared that “we’ve ended the tyranny of so-called Diversity, Equity and Inclusion policies all across the entire federal government and indeed the private sector and our military.” He stressed that appointments should be made strictly on the basis of skills and competence, not race or gender. The Trump administration has also targeted a number of elite universities, including Harvard, for their failure to address “anti-Semitic” protests in support of Palestine and abolish DEI policies, suspending federal funding and restricting international student enrollment.

Read more …

A rose by any other name…

Trump Proposes Renaming Department of Defense to Its Original Name (ET)

President Donald Trump proposed on Aug. 25 that his administration rename the Department of Defense to its previous name, the Department of War. “Pete, you started off by saying ’the Department of Defense.’ And somehow it didn’t sound good to me,” Trump said in the Oval Office, speaking to Defense Secretary Pete Hegseth, after signing executive orders on fighting crime, including in Washington. “Defense. What are we, defense? Why are we defense? It used to be called the Department of War, and it had a stronger sound. And, as you know, we won World War I, we won World War II, we won everything. Now we have a Department of Defense. We’re defenders. I don’t know.” Hegseth, standing behind Trump, said the name change is on the way. “That’s coming soon, sir,” he told Trump.

Trump said that “Department of War” sounds better than “Department of Defense.” “Defense? I don’t want to be Defense only. We want defense, but we want offense too, if that’s OK,” he said, adding that “as Department of War, we won everything, we won everything. And I think we’re going to have to go back to that.” Trump touted bringing an end to conflicts between India and Pakistan and the Congo and Rwanda. This was not the first time Trump had suggested changing the Defense Department back to its previous name. “You know it used to be called secretary of war,” Trump told reporters on June 25 at the NATO summit in the Netherlands. “Maybe for a couple of weeks we’ll call it that because we feel like warriors.” He introduced Hegseth as “secretary of war.” “Then we became politically correct and they called it secretary of defense,” Trump said. “Maybe we’ll have to think about changing it. But we feel that way.”

Prior to becoming defense secretary, Hegseth called for changing the Defense Department back to its old name. “Sure, our military defends us. And in a perfect world it exists to deter threats and preserve peace,” he wrote in his 2024 memoir, “The War on Warriors—Behind the Betrayal of the Men Who Keep Us Free.” “But ultimately its job is to conduct war. We either win or lose wars. And we have warriors, not ‘defenders. Bringing back the War Department may remind a few people in Washington, D.C., what the military is supposed to do, and do well.” The Defense Department was called the Department of War when it was established in 1789. In 1947, President Harry Truman changed the name after merging it with the Navy Department. He signed the National Security Act, which established the position of secretary of defense. It also established the National Security Council, the Joint Chiefs of Staff, and the U.S. Air Force.

Read more …

Once you have a Department of War, a Peace Nobel can’t be far behind.

Giving Trump The Nobel Peace Prize Makes Some Sense (Lukyanov)

In the early 1980s, former US President Jimmy Carter visited Stockholm. At a reception he approached Stig Ramel, the long-serving executive director of the Nobel Foundation, and asked with some bitterness why he had not received the Peace Prize for brokering the Camp David Accords between Egypt and Israel. “If I had been awarded it, I might have been re-elected for a second term,” Carter remarked. He had lost to Ronald Reagan in 1980. Ramel’s reply was blunt: “I’m sorry, Mr. President, but you were not nominated.” The 1978 prize went instead to Egyptian President Anwar Sadat and Israeli Prime Minister Menachem Begin. Carter’s story illustrates how the Nobel Prize has always been as much about timing and perception as about substance. And it brings us neatly to Donald Trump.

Unlike Carter, Trump has no problem with nominations. They come thick and fast, from Rwanda, Cambodia, Gabon, Armenia, Azerbaijan, and beyond. Individuals and organizations have joined the chorus. Trump has even gone a step further: he has demanded the prize outright, loudly and repeatedly. Vanity, not diplomacy, drives him. Carter sought the award to improve his electoral prospects. Trump simply wants every trophy on the shelf. Does the spectacle make sense? Strictly speaking, to be considered this year Trump had to be nominated by January 31 – just ten days after his return to the White House. Yet precedent suggests this is no obstacle. Barack Obama received the Peace Prize in his first year as president, when he had scarcely done anything to warrant it.

Alfred Nobel’s will set out clear criteria: the prize should go to the person who has done most “for fraternity between nations, for the abolition or reduction of standing armies, and for the promotion of peace congresses.” Judged against that standard, Trump looks an unlikely candidate. He is one of the most polarizing figures on the planet. America’s military budget is heading toward a record $1 trillion in 2026, hardly a sign of “reduction of standing armies.” Yet the White House insists Trump deserves recognition. Officials cite half a dozen cases, from preventing nuclear war between India and Pakistan to halting conflicts in smaller states. The centerpiece, of course, is Ukraine. Washington is hinting that Trump’s approach may finally bring the war to a close – with the timing of any peace announcement conveniently close to the Nobel Committee’s own deliberations.

The pitch has not been flawless. In touting his record, Trump recently confused Armenia with Albania. But these are minor slips. What matters is the narrative: that Trump alone can impose order where others have failed. Is the Nobel Committee likely to indulge him? Its members are not known for rewarding bluster. But Europe’s leaders are desperate to appease Washington’s eccentric benefactor. It is not inconceivable that some will lobby behind the scenes in Trump’s favor. In one sense, awarding him the prize would not be absurd. The Nobel Committee has always sought to encourage gestures toward peace, however imperfect. Today, in a world of upheaval, genuine solutions are scarce. At best, one can try to ease tensions.

Trump, in his way, is doing just that – using every tool available, from demonstrative military threats to wild rhetoric and economic coercion. Others are doing even less. To paraphrase Lenin, a Nobel for Trump would be “essentially justified, formally a mockery.” It would capture the spirit of the age: a prize not for genuine reconciliation but for the ability to posture as a peacemaker in a fractured world. Carter, who once felt slighted, eventually did receive the award – more than twenty years after leaving office, in recognition of his peacemaking work as an ex-president. The Camp David accords remain in force to this day, a rare achievement in Middle East diplomacy. Trump is cut from a different cloth. He will not wait decades. By age and by temperament, he demands everything now. Or never at all.

Read more …

“Well, I mean, I’m talking about the — the — I had had, there was a. . . . —Ghislaine Maxwell

Ghislaine ‘Splainin’ (James Howard Kunstler)

Did you happen to bother reading the transcript of Ghislaine Maxwell’s interview? It’s tough sledding at times — both Ms. Maxwell and Deputy AG Todd Blanche tend to speak in choppy, incomplete sentences (as does, you might have noticed, President Trump) — but altogether the confab reveals that just about everything you think you know about the scandal might not be so, and her story is full of shocking surprises, assuming you can believe her. For instance, Ms. Maxwell had exactly one night of actual sex with Jeffrey Epstein back in the 1990s, a few months after they met, and that was it. He had problems with straight-up sex, she says. At first, he claimed to have a heart condition.

She says he had erectile difficulty “. . . which meant that he didn’t have intercourse a lot, which suited me fine, because I actually do have a medical condition, which precludes me having a lot of intercourse,” she added. (We never learn what that condition was, exactly.) Anyway, she never had sex with him again. Huh. . .? There goes one pillar of the public perception of the scandal: that Ghislaine Maxwell was a sort of nymphomaniac consort of Mr. Epstein, while supposedly acting as chief procurer of his masseuse “victims” and that the whole decades-long saga was a cavalcade of threesomes and orgies. She even claims at one point of being “a prude.” So, what was her role in JE’s complicated life? Basically, a property manager, she says. You know, all those houses and compounds: the mansion on East 71st Street, the Palm Beach place, the ranch in New Mexico, Little St. James Island, a flat in Paris.

It was a lot to manage. She had to hire architects, construction crews, interior decorators, servants. There were horses to care for at the ranch. It was a lot. She didn’t even have a key to JE’s New York City townhouse and was there only twice, she told Mr. Blanche. During that time, JE had other girlfriends while in the early 2000s, Ms. Maxwell hooked up with the billionaire founder of Gateway Computers, Ted Waitt. He bought a big boat for them to start-up an oceanic research venture. The relationship foundered when, she says, a sketchy lawyer named Scott Rothstein, working for a crooked Florida law firm that was under a RICO investigation at the time, attempted to extract $10-million from Waitt to keep Ms. Maxwell’s name out of lawsuits brought by women claiming to be “victims” of Epstein’s massage shenanigans.

Ms. Maxwell claims that Epstein’s masseuses, underage or otherwise, were recruited by the original masseuses, not by her (Ms. Maxwell). Ms. Maxwell was out of Epstein’s life after 2009, when he got out of jail on state of Florida charges of soliciting prostitution and procuring a minor for prostitution. This was preceded by a sketchy federal case brought in the Southern District of Florida that ended with a peculiar non-prosecution agreement — when US Attorney Alexander Acosta was told to lay off on account of Epstein being an “intel asset.” Ms. Maxwell states in the new deposition that JE was not associated with any intel agency, claiming it would have been in his nature to brag about it. It would help if FBI chief Kash Patel or CIA head John Ratcliffe could clarify that. They would surely know, one way or the other.

Of course, the heart of all the salacious chatter about Epstein is the claim that he worked for Israel’s Mossad intel agency, and that many eminent global persons were recorded having sex with underage masseuses in order to blackmail them (and, supposedly, allow nefarious hidden parties to control world political affairs.) Ms. Maxwell maintains that this is not so. She says there were no hidden cameras in bedrooms or elsewhere in the many Epstein properties or airplanes, and that she would know because she hired the electricians who installed everything else in them. There were only the usual security cameras on front entrances and gates. . . except for the Palm Beach house where local police installed a camera in JE’s office to catch a thief who was stealing cash stashed there. (Turned out to be JE’s butler, who was fired.)

Another thread at the center of the Epstein rumor mill is the notorious Epstein client list — supposedly of notables alleged to have cavorted with Epstein’s masseuses. Ms. Maxwell claims there was no such list, that a fake list was concocted by attorney Brad Edwards who represented women claiming to be Epstein “victims” in the lawsuit connected with the $10-million Ted Waitt blackmail caper. The list was composed from notes supposedly made off a computer by that same Epstein butler, one Alfredo Rodriguez. When interviewed in 2007, Rodriguez failed to produce the so-called “black book.” In 2009, he offered to sell it to attorney Brad Edwards (representing various “victims”) for $50,000. In 2010, Rodriguez was convicted of obstruction of justice and sentenced to 18 months in prison. He died in 2015.

A lot of monkey business in all this, wouldn’t you say? Perhaps the most astounding point is Ms. Maxwell’s assertion that no government attorney (or any other official, including from the FBI) ever interviewed her, or even called her on the telephone, during all the years of legal wrangling that went on. Say, what. . . ? How could that possibly be? Well, apparently it is so.

Read more …

 

 

 

 

SV40


Blue Dragon

Bees

https://twitter.com/buitengebieden/status/1960045888170004599

Bird

Pebble

 

 

Support the Automatic Earth in wartime with Paypal, Bitcoin and Patreon.

 

 

 

 

 

Mar 252015
 
 March 25, 2015  Posted by at 7:39 am Finance Tagged with: , , , , , , , , ,  Comments Off on Debt Rattle March 25 2015


William Henry Jackson Jupiter & Lake Worth R.R., Florida 1896

The Long-Distance Relationship Between Americans and Jobs (WSJ)
American Cash Is Flooding Into European Stocks (CNN)
Bank of Canada, Government and Others Face Lawsuit for IMF Conspiracy (Epoch T.)
ECB Said to Limit Greek Lenders’ Treasury-Bill Holdings (Bloomberg)
Greeks Celebrate Independence as EU Creditors Discuss Their Fate (Bloomberg)
Next Task For Tsipras Is To Convince His Party (Kathimerini)
Greece: Fascists At The Gate (Hallinan)
China’s Influence Poised To Climb In Revamp Of Postwar Order (Bloomberg)
The New Chinese Dream (Pepe Escobar)
Gulf Should Be More Worried About Yemen Than Oil (CNBC)
Oil Stand-Off In Ukraine Shows Oligarchs Won Maidan Revolution (Sputnik)
Fiscal Virtue And Fiscal Vice – Macroeconomics At A Crossroads (Skidelsky)
Pension Funds Seek Shelter From Dollar’s Rise (WSJ)
Brazil Investigates Deficit-Ridden Pension Fund (Bloomberg)
Money May Make The World Go Round, But At What Cost? (BBC)
Obama Snubs NATO Chief as Crisis Rages (Bloomberg)
Paulson and Warren: The Unlikely Twin Towers of Dodd-Frank (Bloomberg)
Presidents, Bankers, the Neo-Cold War and the World Bank (Nomi Prins)
Financial Feudalism (Dmitry Orlov)
Antibiotics In Meat Rising Fast Worldwide, Especially Bacon (UPI)
Monsanto Bites Back at Roundup Findings (WSJ)

3 trillion kilometers driven last year.

The Long-Distance Relationship Between Americans and Jobs (WSJ)

For more Americans, jobs are moving out of reach, literally. The number of “nearby jobs”–jobs within a typical commute for residents in a major metropolitan area–dropped 7% between 2000 and 2012, according to a new study of census data by Elizabeth Kneebone and Natalie Holmes of the Metropolitan Policy Program at the Brookings Institution. Minorities and poor Americans, who have moved to the suburbs in droves, fared worse. The number of nearby jobs fell 17% for Hispanic residents and 14% for blacks over this time period, compared with a drop of 6% for whites. Typical poor residents saw a drop in job proximity of 17%, versus 6% for the nonpoor. The growing distance between Americans and job opportunities is a discouraging trend amid what’s become the strongest job creation in two decades.

Last month, U.S. employers added a seasonally adjusted 295,000 jobs, the 12th straight month of 200,000-plus net job creation. That’s the best streak since 1995. Most of those jobs are full-time. (In 2012, where the Brookings analysis ends, overall U.S. employment in America’s largest metros was about 2% higher than in 2000, following the Great Recession’s catastrophic job losses.) But what matters for Americans’ employment prospects isn’t just the number of job opportunities, or even how “good” they are, but where they are. People near jobs are more likely to work, and have shorter job searches and periods of joblessness—especially black Americans, women and older workers, Brookings says. Among the poor, being near a job increases the chances of leaving welfare.

Read more …

The world gets more distorted by the day.

American Cash Is Flooding Into European Stocks (CNN)

American cash is pouring into European stocks. Last week alone, U.S.-based funds sent a record amount -$3.9 billion – into Europe equities. That’s according to EPFR Global, a research firm that tracks fund flow data. “The trend is definitely accelerating,” says Cameron Brandt, director of research at EPFR. U.S. investments going to Europe thru mid-March have already outpaced February’s total and are triple the size of January’s figure. Here’s why investors are flocking to Europe:

• Europe’s stock success: It’s no secret that European stocks are hot right now. Since the ECB announced its stimulus plan for the continent in January, markets have surged. The STOXX index (SXXL) is up 16% this year while Germany’s DAX has risen 21% in 2015. Markets in Belgium, Sweden and even Spain – yes, Spain! – are doing great so far too. That’s a lot better than the U.S. markets, which are up just over 1% so far this year. As U.S. stocks look pricey, investors see more upside potential across the pond.
“It’s time for Europe to play catch up,” says Kevin Kelly at Recon Capital. “That’s why you’re seeing investors and funds flow into Europe.”

The stimulus plan has weakened the value of the euro, and at the same time the U.S. dollar is gaining value. The euro has rallied a bit this week, but it’s still near 12-year lows. Many believe the dollar and euro could be equal later this year. The currency situation makes European companies more attractive to investors because their products are cheaper to sell than American companies’ products. European exports are on the rise, and the eurozone economy is showing signs of a pick up.

• Expect the trend to continue: The flood of money into Europe is unlikely to stop any time soon. Sixty-three% of fund managers want to invest more in Europe this year, according to the most recent BofA Merrill Lynch fund manager survey. That’s the highest rate since 2001. One of the hot-ticket items right now for investors is exchange-traded fund (ETF) that own European stocks. Investment in those ETFs so far this year has doubled compared to the same time a year ago, according to BlackRock.

Read more …

Intriguing.

Bank of Canada, Government and Others Face Lawsuit for IMF Conspiracy (Epoch T.)

It would be easy to assume the people suing the Queen of England, the Bank of Canada, and three ministers for a conspiracy against “all Canadians” wear tinfoil hats. They don’t. They may be conspiracy theorists, but they are also intelligent, thoughtful people who have a lawyer with a history of winning unlikely cases. And despite the government’s best efforts to have this case thrown out, it’s going ahead after winning an appeal that overturned a lower court’s ruling to have it tossed and surviving a follow-up motion to have it tossed again. The government has one more chance to have it thrown out through an appeal at the Supreme Court, but that has to be filed by Mar. 29 and that looks unlikely. That means the Committee on Monetary and Economic Reform (COMER) is going to have its day in federal court.

This little think-tank alleges that the Bank of Canada, the Queen, the attorney general, the finance minister, and minister of national revenue are engaging in a conspiracy with the International Monetary Fund (IMF), the Financial Stability Board (FSB), and the Bank for International Settlements (BIS) to undermine Canada’s financial and monetary sovereignty. No major media have covered this story. That could be because of the powerful vested interests the suit targets, as Rocco Galati, the lawyer trying the case, suggests. Or it could be because there are parts of the statement of claim that read like they were pulled from the dark corners of some Internet conspiracy forum. They weren’t. These are serious people with wide knowledge of the financial and monetary system. And their lawyer is no slouch.

Read more …

Dangerous games.

ECB Said to Limit Greek Lenders’ Treasury-Bill Holdings (Bloomberg)

The ECB banned Greek banks from increasing holdings of short-term government debt, two people familiar with the matter said. The decision, approved by the ECB Governing Council, comes five days after the same body stalled a previous proposal by the institution’s supervisory arm, pending legal review. In the intervening days, Greek Prime Minister Alexis Tsipras met high-level euro-area officials, including ECB President Mario Draghi and German Chancellor Angela Merkel. Tsipras agreed to submit a comprehensive list of policy measures aimed at securing more financial aid from European partners.

Euro-area finance officials will hold a call on Wednesday to discuss progress on Greece, amid concerns that the country will run out of money by early April. The Governing Council decision makes previous supervisory recommendations legally binding, and reflects increasing concern at the ECB’s bank oversight body, the SSM, about Greek lenders’ exposure to the state and the accompanying default risk. The ban echoes decisions already made on the monetary policy side, such as a €3.5 billion limit on accepting Greek treasury bills as collateral, one of the people said.

Read more …

Independence Day. But not a lot of independence.

Greeks Celebrate Independence as EU Creditors Discuss Their Fate (Bloomberg)

Greeks celebrate their independence Wednesday with a military parade and a folk-music festival sponsored by the Ministry of Defense, as European officials more than 1,000 miles away review the financial aid that will shape their future. The ECB Governing Council will hold a weekly call to assess the Emergency Liquidity Assistance keeping Greece’s banking system afloat while euro-area finance ministry officials will have a separate discussion on the progress of the country’s economic policy program. Without access to capital markets, or the ECB’s normal financing operations, Greek banks rely on almost €70 billion of ELA to cover a financing shortfall exacerbated by steep deposit withdrawals.

While inspectors are gauging the case for continuing financial support for Europe’s most-indebted nation, many Athenians will be watching a parade of battle tanks and fighter jets to mark the beginning in 1821 of the war that won independence from the Ottoman Empire. The government of George Papandreou scaled down military parades to cut costs after the Greek debt crisis erupted in 2010. Fighter jets made a comeback to the skies of Athens last year at a cost of about €500,000, according to a defense ministry official from the previous administration.

With government cash supplies running out and negotiations on financial aid only inching forwards, European officials have said that Greece could default on its obligations within weeks unless there’s a breakthrough. The government has to pay about €1.5 billion of salaries and pensions by the end of March and Prime Minister Alexis Tsipras is at loggerheads with its creditors over the conditions attached to its emergency loans. Revenue from taxes also missed budget targets by about €1 billion in the first two months of the year, the country’s Ministry of Finance said Tuesday, further depleting cash buffers.

Read more …

Will Syriza blow it all up?

Next Task For Tsipras Is To Convince His Party (Kathimerini)

Returning from his official visit to Germany, one of Prime Minister Alexis Tsipras’s main tasks will be to ensure his party’s support for the reform list his government is compiling and preparing to send to lenders, possibly by the end of the week. Sources said that Tsipras will take it upon himself to convince SYRIZA members and MPs to back the reform plan, which should secure Greece the funding it needs to survive until the end of June, when the government will have to reach a new agreement with its lenders. The prime minister’s first port of call in this effort to sell the current package will be the party’s political secretariat. A meeting is expected to take place in the next few days.

This will be followed by a gathering of SYRIZA’s parliamentary group, where Tsipras will try to persuade the party’s 149 MPs to back the reforms when they come to Parliament. The content of the reform package is not yet known but the government is concerned that it will contain a number of items that will not go down well within SYRIZA. This could include the retention of the contentious ENFIA property tax for another year, albeit adjusted so that the less well-off pay less, as well as labor and pension reforms. The coalition has already sought to defuse any tension over privatizations by saying that it will only seek strategic partnerships that allow the state to retain a controlling majority.

An area of increasing friction is what the government plans to do with value-added tax. Lenders want the special 30% reduction on VAT enjoyed by islands to be scrapped. Alternate Finance Minister Nadia Valavani told ANT1 TV yesterday that one option might be to adopt regular VAT rates on the most popular islands, such as Santorini and Myconos. However, this runs counter to what government sources have been saying so far. It is believed the coalition is examining the option of adopting an across-the-board VAT rate of 15%, which means some goods will become cheaper and others more expensive, but with possible exceptions for some basic items such as medicines.

Read more …

Next in line if Syriza fails?!

Greece: Fascists At The Gate (Hallinan)

When some 70 members of the neo-Nazi organization Golden Dawn go on trial sometime this spring, there will be more than street thugs and fascist ideologues in the docket, but a tangled web of influence that is likely to engulf Greece’s police, national security agency, wealthy oligarchs, and mainstream political parties. While Golden Dawn—with its holocaust denial, its swastikas, and Hitler salutes—makes it look like it inhabits the fringe, in fact the organization has roots deep in the heart of Greece’s political culture Which is precisely what makes it so dangerous. Golden Dawn’s penchant for violence is what led to the charge that it is a criminal organization. It is accused of several murders, as well as attacks on immigrants, leftists, and trade unionists. Raids have uncovered weapon caches.

Investigators have also turned up information suggesting that the organization is closely tied to wealthy shipping owners, as well as the National Intelligence Service (EYP) and municipal police departments. Several lawyers associated with two victims of violence by Party members—a 27-year old Pakistani immigrant stabbed to death last year, and an Afghan immigrant stabbed in 2011— charge that a high level EYP official responsible for surveillance of Golden Dawn has links to the organization. The revelations forced Dimos Kouzilos, director of EYP’s third counter-intelligence division, to resign last September. There were several warning flags about Kouzilos when he was appointed to head the intelligence division by rightwing New Democracy Prime Minister Antonis Samaras.

Kouzilos is a relative of a Golden Dawn Parliament member, who is the Party’s connection to the shipping industry. Kouzilos is also close to a group of police officers in Nikea, who are currently under investigation for ties to Golden Dawn. Investigators charge that the Nikea police refused to take complaints from refugees and immigrants beaten by Party members, and the police Chief, Dimitris Giovandis, tipped off Golden Dawn about surveillance of the Party. In handing over the results of their investigation, the lawyers said the “We believe that this information provides an overview of the long-term penetration ands activities of the Nazi criminal gang with the EYP and the police.” A report by the Office of Internal Investigation documents 130 cases where Golden Dawn worked with police.

It should hardly come as a surprise that there are close ties between the extreme right and Greek security forces. The current left-right split goes back to 1944 when the British tried to drive out the Communist Party—the backbone of the Greek resistance movement against the Nazi occupation. The split eventually led to the 1946-49 civil war when Communists and leftists fought royalists and former German collaborationists for power.

Read more …

What if a big recession hits?

China’s Influence Poised To Climb In Revamp Of Postwar Order (Bloomberg)

Seven decades after the end of World War II, the international economic architecture crafted by the U.S. faces its biggest shakeup yet, with China establishing new channels for influence to match its ambitions. Three lending institutions with at least $190 billion are taking shape under China’s leadership, one of them informally referred to as a Marshall Plan – evoking the postwar U.S. program to rebuild an impoverished Europe. Also this year, China’s yuan may win the IMF’s blessing as an official reserve currency, a recognition of its rising use in trade and finance. China’s clout has been expanding for decades, as its rapid growth allowed it to snap up a rising share of the world’s resources, its exports penetrated global markets, and its bulging financial assets gave it power to make big individual loans and purchases.

Now, the creation of international lending institutions is leveraging that economic influence closer to the political and diplomatic arenas, as U.S. allies defy America to back China’s initiative. “This is the beginning of a bigger role for China in global affairs,” said Jim O’Neill, formerly at Goldman Sachs, who coined the term BRICs in 2001 to highlight the rising economic power of Brazil, Russia, India and China. Chinese President Xi Jinping’s vision of achieving the same great-power status enjoyed by the U.S. received a major boost this month when the U.K., Germany, France and Italy signed on to the Asian Infrastructure Investment Bank. The AIIB will have authorized capital of $100 billion and starting funds of about $50 billion.

Canada is considering joining, which would leave the U.S. and Japan as the only Group of Seven holdouts as they question the institution’s governance and environmental standards. Australian Prime Minister Tony Abbott’s cabinet approved negotiations to join too, according to a government official who asked not to be identified as the decision hasn’t been made public. “China’s economic rise is acting as a huge pull factor forcing the existing architecture to adapt,” said James Laurenceson, deputy director of the Australia-China Relations Institute in Sydney. “The AIIB has shown the U.S. that a majority in international community support China’s aspirations for taking on greater leadership and responsibility, at least on economic initiatives.”

Read more …

It’s still all just printed Monopoly cash, Pepe.

The New Chinese Dream (Pepe Escobar)

It’s no wonder top nations in the beleaguered EU have gravitated to the AIIB – which will play a key role in the New Silk Road(s). A German geographer – Ferdinand von Richthofen – invented the Seidenstrasse (Silk Road) concept. Marco Polo forever linked Italy with the Silk Road. The EU is already China’s number one trade partner. And, once again symbolically, this happens to be the 40th year of China-EU relations. Watch the distinct possibility of an emerging Sino-European Fund that finances infrastructure and even green energy projects across an integrated Eurasia. It’s as if the Angel of History – that striking image in a Paul Klee painting eulogized by philosopher Walter Benjamin – is now trying to tell us that a 21st century China-EU Seidenstrasse synergy is all but inevitable.

And that, crucially, would have to include Russia, which is a vital part of the New Silk Road through an upcoming, Russia-China financed $280 billion high-speed rail upgrade of the Trans-Siberian railway. This is where the New Silk Road project and President Putin’s initial idea of a huge trade emporium from Lisbon to Vladivostok actually merge. In parallel, the 21st century Maritime Silk Road will deepen the already frantic trade interaction between China and Southeast Asia by sea. Fujian province – which faces Taiwan – will play a key role. Xi, crucially, spent many years of his life in Fujian. And Hong Kong, not by accident, also wants to be part of the action.

All these developments are driven by China being finally ready to become a massive net exporter of capital and the top source of credit for the Global South. In a few months, Beijing will launch the China International Payment System (CIPS), bound to turbo-charge the yuan as a key global currency for all types of trade. There’s the AIIB. And if that was not enough, there’s still the New Development Bank, launched by the BRICs to compete with the World Bank, and run from Shanghai.

Read more …

.. the Saudi Arabian foreign minister said the GCC would take “necessary measures” to resolve the Yemeni conflict..”

Gulf Should Be More Worried About Yemen Than Oil (CNBC)

Civil strife and terrorism in Yemen could pose a greater threat to the Gulf countries of the Middle East than tumbling oil prices, a major bank said on Tuesday. “We can’t help but think that the turmoil in Yemen is the emerging and underappreciated risk for investors in GCC (Gulf Cooperation Council) stocks,” said Citi analysts Josh Levin and Rahul Bajaj in a research note. Despite worries about Islamic insurgency and destabilization in the Middle East and North Africa, investors in the oil-exporting GCC countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE) have focused on the potential hit from the slump in energy prices, with crude oil down around 50% since a peak in June 2014.

However, Levin and Bajaj said that increasing strife in Yemen—which borders Saudi Arabia to the south and Oman to the west— could be an “underappreciated risk” to the GCC. “One of the key takeaways from our GCC trip in early February came from an executive in Qatar who observed that while most people are focused on the price of oil, the recent instability in Yemen posed a greater and underappreciated risk to the GCC. Recent events appear to bear out this executive’s observation,” they said on Tuesday. Yemen is in the grips of a worsening civil war, with fighting intensifying between ousted Sunni President Abd-Rabbuh Mansuh Hadi and the Shiite, anti-American rebels who seized power in a coup in January.

The rebels also face violent resistance from Sunni tribesman and competing Islamist extremists in the south. Last week, suicide bombers opposed to the rebels killed 137 people and injured more than 300 others during Friday prayers in the Yemini capital of Sana’a. On Monday, the Saudi Arabian foreign minister said the GCC would take “necessary measures” to resolve the Yemeni conflict, according to media reports. This is in response to requests for military assistance from Hadi, who belongs to the same Muslim Sunni sect as Saudi Arabia’s leaders. Levin and Bajaj warned that the turmoil in Yemen had the potential to spill over into nearby countries. “We have no edge or ability to predict whether or not the conflict in Yemen will spill over into neighboring countries or impact other GCC countries,” they said.

Read more …

Kolomoysky ‘resigned’ after the article was written.

Oil Stand-Off In Ukraine Shows Oligarchs Won Maidan Revolution (Sputnik)

Whatever the outcome of the stand-off between President Petro Poroshenko and his subordinate Igor Kolomoysky may be, their conflict over Ukrainian oil giant Ukrnafta reveals realities about post-Maidan Ukraine which mainstream media manages to circumvent. Firstly, the country is still ruled by oligarchs, not by the people, even though Igor Kolomoysky is formally governor of Dnepropetrovsk region. Kolomoysky’s private army simply took control first of Ukrtransnafta (Ukraine’s oil transportation monopoly) and later of Ukrnafta. What does this tell us about the Ukrainian state? Secondly, Ukraine’s oligarchs are not at peace with each other; the country is bracing for a major ‘war for assets’ between the country’s richest men (Kolomoysky is worth $2.4 billion on the Forbes list and Poroshenko is worth $1.3 billion).

Thirdly, the Maidan revolution not only left the country without any meaningful legal opposition in the parliament or in the media – as Kost Bondarenko, director of the Kiev-based Foundation for Ukrainian Politics, put it in his article for the Moscow-based Nezavisimaya Gazeta – but the revolution also left Ukraine in a situation of complete lawlessness, when neither laws nor even the words of the president mean much before brutal force and big money (the main weapons of oligarchs). The story of the weekend conflict between Ukraine’s president and the governor of Ukraine’s most important industrial region is a perfect illustration of all these sad truths. Kolomoysky’s men with submachine guns not only took control of Ukrtransgaz on Friday, but the governor of Dnepropetrovsk was apparently untroubled by President Poroshenko’s reprimand for his “unethical behavior” issued the next day.

Kolomoysky’s response to this “scolding” from Poroshenko was widely reported, along with an officially unconfirmed freeze on the accounts of Poroshenko’s companies in Kolomoysky’s bank (Privat-bank). Adding armed insult to the financial injury, Kolomoysky’s men on Sunday took control of Ukrnafta, the country’s biggest oil company, presenting themselves as members of the “voluntary battalion Dnieper” (a Kolomoysky-sponsored paramilitary group known for its atrocities against civilians in the rebellious Donetsk Region). Despite Poroshenko’s order to disarm the gunmen and the president’s promise that “there will be no pocket armies in Ukraine,” Kolomoysky’s men did not leave the building on Monday; instead, they started to put up metal fences around it.

Read more …

“..fiscal tightening has cost developed economies 5-10 percentage points of GDP growth since 2010..”

Fiscal Virtue And Fiscal Vice – Macroeconomics At A Crossroads (Skidelsky)

Until a few years ago, economists of all persuasions confidently proclaimed that the Great Depression would never recur. In a way, they were right. After the financial crisis of 2008 erupted, we got the Great Recession instead. Governments managed to limit the damage by pumping huge amounts of money into the global economy and slashing interest rates to near zero. But, having cut off the downward slide of 2008-2009, they ran out of intellectual and political ammunition. Economic advisers assured their bosses that recovery would be rapid. And there was some revival; but then it stalled in 2010. Meanwhile, governments were running large deficits – a legacy of the economic downturn – which renewed growth was supposed to shrink.

In the eurozone, countries such as Greece faced sovereign-debt crises as bank bailouts turned private debt into public debt. Attention switched to the problem of fiscal deficits and the relationship between deficits and economic growth. Should governments deliberately expand their deficits to offset the fall in household and investment demand? Or should they try to cut public spending in order to free up money for private spending? Depending on which macroeconomic theory one held, both could be presented as pro-growth policies. The first might cause the economy to expand, because the government was increasing public spending; the second, because they were cutting it. Keynesian theory suggests the first; governments unanimously put their faith in the second.

The consequences of this choice are clear. It is now pretty much agreed that fiscal tightening has cost developed economies 5-10 percentage points of GDP growth since 2010. All of that output and income has been permanently lost. Moreover, because fiscal austerity stifled economic growth, it made the task of reducing budget deficits and national debt as a share of GDP much more difficult. Cutting public spending, it turned out, was not the same as cutting the deficit, because it cut the economy at the same time. That should have ended the argument. But it did not. Some economists claim that governments faced a balance of risk in 2010: cutting the deficit might have slowed growth; but not committing to cut it might have made things even worse.

Read more …

Reinforce your local infrastructure!

Pension Funds Seek Shelter From Dollar’s Rise (WSJ)

The soaring U.S. dollar is driving pension funds into the currency markets, in part to protect their overseas investments but also to take advantage of some of the biggest price swings in the financial world. In January, the California State Teachers Retirement System, the nation’s second-largest public pension fund with $190.8 billion under management, handed $500 million to a pair of specialist currency funds as part of an effort to limit losses on their international investments, which fall in value as the dollar rises against other currencies. Late last year, the $150.2 billion Florida State Board of Administration expanded its currency investments by more than 10%, to $2.25 billion.

Last June, the $29 billion Connecticut Retirement Plans & Trust Funds hired two managers to help reduce the foreign-currency risks in its international stock investments. And the $14.3 billion Kansas Public Employees Retirement System is now looking to hire a currency manager. The clamor to protect against currency swings marks a return to a strategy that pension funds have tried on and off for years, with mixed results. While it is good news for the money managers that provide the strategies, which stand to reap tens of thousands of dollars in fees for every pension plan that signs up, it also adds to the risks taken on by pensions. Currency markets are among the most volatile, raising the potential for big profits, but also big losses.

“The pickup since December has been extraordinary,” said Adrian Lee, who manages Adrian Lee & Partners hedge fund. “We’ve had more funds interested in our strategies in the last three months than we’ve had in the last three years.” The fund’s assets have grown 30% in the past year, as existing clients raised their allocations, Mr. Lee said. At their most basic, currency strategies come in two flavors. A passive currency-overlay program that seeks to hedge against foreign-exchange losses typically costs between 0.05% and 0.1% of assets, based on a pension’s exposure to foreign markets, according to NEPC, a consultant to pension plans.

Active strategies that seek to profit from currency swings tend to be several times more expensive, as they include higher management fees and allow hedge funds to keep a share of profits. The rising dollar has re-energized interest in both strategies. While the U.S. Federal Reserve is expected to raise interest rates as soon as June, both Europe and Japan are pumping out economic stimulus at unprecedented levels, seeking to stimulate their economies by keeping rates low. The divergence in borrowing costs has sparked an exodus of capital, as investors quit euro and yen-denominated assets and head into the greenback.

Read more …

From one scandal to the next.

Brazil Investigates Deficit-Ridden Pension Fund (Bloomberg)

The deficit-ridden pension fund for Brazilian postal workers is being investigated for alleged reckless management after several years of money-losing bets ranging from investments in Lehman Brothers bonds to Argentine debt, two people with knowledge of the matter said. Pension-fund agency Previc, securities regulator CVM, the central bank and federal prosecutors are collaborating on the probe and meeting weekly to conclude a report on Postalis, Brazil’s third-largest retirement system by number of beneficiaries, said one of the people, who asked not to be named because the issue is private. The findings may be released in coming days, the person said. Under Brazilian law, the agencies may seek penalties that may include fines of as much as 1 million reais ($320,200) and a 10-year ban from managing pension funds.

Postalis has been running a deficit every year since 2011 and the shortfall of 5.6 billion reais now eclipses its 5 billion reais in assets, public records show. Now, the pension fund created in 1981 to take care of Brazil’s more than 100,000 postal workers is requiring those same employees to boost contributions so it can keep making payments to beneficiaries. “They threw us under the bus,” said 36-year-old Douglas Melo, who is required to pitch in an extra 40 reais a month on top of the 55 reais he already contributes to guarantee future benefits of 200 reais a month. “The fund’s investments that later defaulted or were involved in scandals make no sense.”

Postalis amassed billions of reais in losses pursuing risky bets while its peers flocked to the relative safety and high yields of Brazilian government debt. Brazil’s pension funds allocated 15% of their combined 641.7 billion-real portfolio to Brazil local sovereign debt in 2012, according to the nation’s association that tracks the industry. Postalis held less than 1% in 2012. Postalis bet on a fund that booked 18 million reais of Lehman Brothers debt in August 2008, one month before the New York investment bank filed for bankruptcy, according to data from Brazil’s securities regulator. It bought bonds or invested in funds of mid-sized Brazilian banks that were liquidated by the central bank in 2012 amid fraud allegations and lack of capital.

Read more …

Rage against the monopoly. And then create another one just as fast.

Money May Make The World Go Round, But At What Cost? (BBC)

Banks once had a near monopoly on moving money around the world, and they charged a pretty penny for it. But since the 2008 financial crisis, their reputations have taken an almighty battering, and a growing number of technology-focused start-ups are intent on getting a slice of the action. Cost has become the battleground and technology the weapon in this huge business: people send more than $500bn (£334bn) abroad each year. TransferWise, for example, says banks and independent money transfer giants such as Western Union and MoneyGram, charge about 5-8% in fees when transferring money abroad, and these fees are often concealed within the exchange rate. It charges just 0.5% of the amount being converted. This can equate to a £100-£150 saving on a £5,000 international money transfer.

Founded by Estonians Taavet Hinrikus and Kristo Kaarman, the firm achieves this by matching people transferring money in one direction with people transferring it in the other – so called peer-to-peer transfers. In other words, you are in effect buying your currency from other individuals, thereby cutting out a big chunk of exchange rate and “foreign transaction” charges normally levied by banks. “We didn’t understand why transferring money had to be so expensive,” says Mr Hinrikus, who was one of the first employees of Skype, the online communications company. “With us, it’s all about transparency – that’s really important. We choose the mid-market rate when we transfer money.” Another key to their success – TransferWise has shifted more than £3bn of customers’ money since 2011 – is the simplicity of design, he says.

Read more …

Does he do this of his own accord?

Obama Snubs NATO Chief as Crisis Rages (Bloomberg)

President Barack Obama has yet to meet with the new head of NATO, and won’t see Secretary General Jens Stoltenberg this week, even though he is in Washington for three days. Stoltenberg’s office requested a meeting with Obama well in advance of the visit, but never heard anything from the White House, two sources close to the NATO chief told me. The leaders of almost all the other 28 NATO member countries have made time for Stoltenberg since he took over the world’s largest military alliance in October. Stoltenberg, twice the prime minister of Norway, met Monday with Canadian Prime Minister Stephen Harper in Ottawa to discuss the threat of the Islamic State and the crisis in Ukraine, two issues near the top of Obama’s agenda. Kurt Volker, who served as the U.S. permanent representative to NATO under both President George W. Bush and Obama, said the president broke a long tradition.

“The Bush administration held a firm line that if the NATO secretary general came to town, he would be seen by the president … so as not to diminish his stature or authority,” he told me. America’s commitment to defend its NATO allies is its biggest treaty obligation, said Volker, adding that European security is at its most perilous moment since the Cold War. Russia has moved troops and weapons into eastern Ukraine, annexed Crimea, placed nuclear-capable missiles in striking distance of NATO allies, flown strategic-bomber mock runs in the North Atlantic, practiced attack approaches on the UK and Sweden, and this week threatened to aim nuclear missiles at Denmark’s warships. “It is hard for me to believe that the president of the United States has not found the time to meet with the current secretary general of NATO given the magnitude of what this implies, and the responsibilities of his office,” Volker said.

Read more …

Barney Frank memoirs.

Paulson and Warren: The Unlikely Twin Towers of Dodd-Frank (Bloomberg)

On the surface, Henry Paulson, the former CEO of Goldman Sachs and Secretary of the Treasury under President George W. Bush, and Senator Elizabeth Warren, the populist Democrat from Massachusetts, seem an unlikely team. But former Representative Barney Frank, co-author of the Dodd-Frank financial reform legislation enacted in 2010, said he views Paulson and Warren as twin pillars protecting the financial system. In an interview this week on the Charlie Rose television program, Frank, who was chairman of the House Financial Services Committee during the 2008-2009 financial crisis, recalled former Federal Reserve Chairman Ben Bernanke and Paulson telling Congressional Democratic leaders, “The economy is about to fall apart and we have got to do something the public isn’t going to like.”

Frank worked with Bernanke and Paulson to push through the unpopular but ultimately successful financial bailout known as the Troubled Asset Relief Program. Paulson, Frank said, remained helpful even after leaving government, assisting in the drafting and passing of Dodd-Frank. While Paulson helped establish Dodd-Frank, Frank said, “Elizabeth Warren is helping safeguard it” from Republicans eager to scuttle the law. He acknowledged that Dodd-Frank is complex. But Frank insisted it was neither politically nor substantively possible to make the legislation, which overhauls some regulations dating to the 1930s, less complicated. “In the thirties, there was no such thing as credit default swaps and collateralized loan obligations and collateralized debt obligations,” he said.

Frank’s memoir – titled “Frank” – chronicles his more than four decades in public life. For the first two decades, he said, he felt it necessary to hide his sexuality while celebrating his advocacy of liberal policies. Now, he says, it’s easier to be gay — he was married during his final term in Congress – and harder to champion liberal policies.

Read more …

The World Bank as a power tool.

Presidents, Bankers, the Neo-Cold War and the World Bank (Nomi Prins)

At first glance, the neo-Cold War between the US and its post WWII European Allies vs. Russia over the Ukraine, and the stonewalling of Greece by the Troika might appear to have little in common. Yet both are manifestations of a political-military-financial power play that began during the first Cold War. Behind the bravado of today’s sanctions and austerity measures lies the decision-making alliance that private bankers enjoy in conjunction with government and multinational entries like NATO and the World Bank. It is President Obama’s foreign policy to back the Ukraine against Russia; in 1958, it was the Eisenhower Doctrine that protected Lebanon from a Soviet threat. For President Truman, the Marshall Plan arose partly to guard Greece (and other US allies) from Communism, but it also had lasting economic implications.

The alignment of political leaders and key bankers was more personal back then, but the implications were similar to the present day. US military might protected its major trading partners, which in turn, did business with US banks. One power reinforced the other. Today, the ECB’s QE program funds swanky Frankfurt headquarters and prioritizes Germany’s super-bank, Deutschebank and its bond investors above Greece’s future. These actions, then and now, have roots in the American ideology of melding military, political and financial power that flourished in the haze of World War II. It’s not fair to pin this triple-power stance on one man, or even one bank; yet one man and one bank signified that power in all of its dimensions, including the use of political enemy creation to achieve financial goals.

That man was John McCloy, ‘Chairman of the Establishment’ as his biographer, Kai Bird, characterized him. The relationship between McCloy and Truman cemented a set of public-private practices that strengthened private US banks globally at the expense of weaker, potentially Soviet (now Russian) leaning countries. [..] During the Cold War, the World Bank provided funds for countries that leaned toward capitalism versus communism. Political allies of the United States got better treatment (and still do). The Nations that private bankers coveted for speculative and lending purposes saw their debt loads increase substantially and their industries privatized. Equally, the bankers decided which bonds they could sell to augment public aid funds, which meant they would have control over which countries the World Bank would support. The World Bank did more to expand US banking globally than any treaty or entity that came before it.

Read more …

Good read.

Financial Feudalism (Dmitry Orlov)

Once upon a time—and a fairly long time it was—most of the thickly settled parts of the world had something called feudalism. It was a way of organizing society hierarchically. Typically, at the very top there was a sovereign (king, prince, emperor, pharaoh, along with some high priests). Below the sovereign were several ranks of noblemen, with hereditary titles. Below the noblemen were commoners, who likewise inherited their stations in life, be it by being bound to a piece of land upon which they toiled, or by being granted the right to engage in a certain type of production or trade, in case of craftsmen and merchants. Everybody was locked into position through permanent relationships of allegiance, tribute and customary duties: tribute and customary duties flowed up through the ranks, while favors, privileges and protection flowed down.

It was a remarkably resilient, self-perpetuating system, based largely on the use of land and other renewable resources, all ultimately powered by sunlight. Wealth was primarily derived from land and the various uses of land. Feudalism was essentially a steady-state system. Population pressures were relieved primarily through emigration, war, pestilence and, failing all of the above, periodic famine. Wars of conquest sometimes opened up temporary new venues for economic growth, but since land and sunlight are finite, this amounted to a zero-sum game. But all of that changed when feudalism was replaced with capitalism. What made the change possible was the exploitation of nonrenewable resources, the most important of which was energy from burning fossilized hydrocarbons: first peat and coal, then oil and natural gas.

Suddenly, productive capacity was decoupled from the availability of land and sunlight, and could be ramped up almost, but not quite, ad infinitum, simply by burning more hydrocarbons. Energy use, industry and population all started going up exponentially. A new system of economic relations was brought into being, based on money that could be generated at will, in the form of debt, which could be repaid with interest using the products of ever-increasing future production. Compared with the previous, steady-state system, the change amounted to a new assumption: that the future will always be bigger and richer—rich enough to afford to pay back both principal and interest.

Read more …

A tragic species killing itself:”..antibiotic use in livestock will likely rise 67% by 2030 if livestock conditions don’t improve. About 80% of antibiotics sold in the United States go to livestock”.

Antibiotics In Meat Rising Fast Worldwide, Especially Bacon (UPI)

In the next 15 years, countries around the world will see a major increase in antibiotic use in livestock, a new study finds. “The invention of antibiotics was a major public health revolution of the 20th century,” said senior author Ramanan Laxminarayan, a senior research scholar at the Princeton Environmental Institute and director of the Center for Disease Dynamics, Economics and Policy. “Their effectiveness – and the lives of millions of people around the world – are now in danger due to the increasing global problem of antibiotic resistance, which is being driven by antibiotic consumption.” The study was done by researchers at the Center for Disease Dynamics, Economics and Policy, Princeton University, the International Livestock Research Institute and the Université Libre de Bruxelles.

The researchers found antibiotic use in livestock will likely rise 67% by 2030 if livestock conditions don’t improve. About 80% of antibiotics sold in the United States go to livestock. Antibiotic resistance not only applies to the animals, but it can affect the humans eating the meat. The researchers found pig farmers producing pork and bacon use four times as many antibiotics as cattle farmers. One of the major reasons farmers are having to use more and more antibiotics is that demand for meat is going up, and animals are often subjected to smaller and smaller living quarters, where disease can spread.

Read more …

Feel the power.

Monsanto Bites Back at Roundup Findings (WSJ)

Monsanto Co. escalated its criticism of a World Health Organization agency’s finding last week that a commonly used herbicide probably has the potential to cause cancer in humans. The St. Louis-based agribusiness giant—a major seller of the weed killer—sought a meeting with senior WHO officials on the International Agency for Research on Cancer’s finding, while a WHO agency official defended what he called an “exhaustive” review of eligible data. The IARC’s classification of glyphosate, the U.S.’s most commonly used weedkiller, as “probably carcinogenic” in a report published Friday reignited debate over a chemical that environmental groups have long criticized and the agricultural industry has defended as safe for humans and less harsh on the environment than others.

“We are outraged with this assessment,” Robert Fraley, Monsanto’s chief technology officer, said Monday, arguing that the finding was derived from “cherry picking” data based on an “agenda-driven bias.” Monsanto, which markets glyphosate under the Roundup brand, sent letters to WHO members seeking to discuss the IARC classification, which Monsanto officials said ran counter to many other findings, including those by other WHO programs, according to Philip Miller, the company’s vice president of global regulatory affairs. Dana Loomis, deputy head of the monographs section for the IARC, said the agency’s classification of glyphosate as “probably carcinogenic” was based on an examination of peer-reviewed research and completed government reports on the herbicide.

“We feel confident that our process is transparent and rigorous, based on the best available scientific data, and that it’s free from conflicts of interest,” Mr. Loomis said. He also said it was “categorically not true” that the IARC overlooked research on glyphosate, as Monsanto and other agriculture groups alleged. He said the IARC seeks to find and review all publicly available, peer-reviewed research and government documents in their final form. That excludes draft research, he said, which can change before it is completed.

Read more …