Salvador Dali Grandmother Ana sewing 1920
I’ve been in a Not The Onion mode all day. It started off with reading that Shell is paying to offset its UK customers’ carbon emissions. For blunt stupidity, that’s hard to beat. That Johnson and Johnson was “ordered to pay $8 billion (!!!) after drug causes man to grow breasts” already seemed more logical after that. That Joe Biden made even more money off Burisma than Hunter did, then seemed perfectly normal. It was all uphill from there.
• Inside Hunter Biden’s Dealings With Shadowy Foreign Firms (ZH)
According to the FT, Biden’s business interests “often show up in unexpected places.” While Democrats obviously prefer to focus on their impeachment investigation, there’s no denying that Biden’s business dealings in Ukraine, China and elsewhere clearly raise questions about potential conflicts that existed while his father was in office. Joe Biden has denied wrongdoing, but questions linger over his role in the ouster of a top Ukrainian prosecutor, which some have suggested was done to help protect Hunter. When Hunter joined the Navy Reserves in May 2013, he required several waivers (at 42, he was above the age of enlistment, and there was an unspecified ‘drug-related’ incident that also would have disqualified him).
Despite his apparent eagerness to join, Biden was discharged from the Navy the following year after testing positive for cocaine. Soon after, his more successful older brother, Beau, passed away, and his wife Kathleen filed for divorce, citing Hunter’s “spending extravagantly on his own interests including drugs, alcohol, prostitutes, strip clubs and gifts for women with whom he has sexual relations.” Next, he started dating his brother’s widow. But in between trips to rehab and legendary drug benders. In 2016, shortly after he started dating Hallie Biden, Beau’s widow, Hunter made plans to stay at a detox center in Arizona. But he somehow got sidetracked during a stopover in Los Angeles, and ended up missing the next wing of his flight. Instead, he traveled to Skid Row, where he was reportedly held up at gun point, but nevertheless apparently succeeded in buying and using crack, causing him to return several times over the following days.
Eventually, Hunter Biden took a Hertz rental car to his treatment center in Arizona, but workers at the Hertz office called the police after finding a crack pipe and baggie of crack, along with Biden’s license and a badge from Beau’s time as Delaware AG. Prosecutors declined to pursue the case, claiming a lack of evidence, but it definitely wasn’t a good look for Hunter. More recently, Hunter has been in the headlines for his whirlwind marriage to a South African Instagram model, and for a paternity suit brought by a woman claiming Hunter is the father of her newborn son. Of course, none of these transgressions have stopped Biden from earning millions of dollars off his family name and connections. In Wednesday’s issue, the FT published a breakdown of Biden’s foreign business interests.
As I said, perfectly normal.
• Joe Biden ‘Personally Paid $900,000 By Burisma’ – Ukrainian MP (ZH)
Ukrainian MP Andriy Derkach revealed on Wednesday that former Vice President Joe Biden received $900,000 from Burisma Group for lobbying activities, citing materials related to an investigation. Via Interfax: “Former U.S. Vice President Joe Biden received $900,000 for lobbying activities from Burisma Group, Ukraine’s Verkhovna Rada member Andriy Derkach said citing investigation materials. Derkach publicized documents which, as he said, “describe the mechanism of getting money by Biden Sr.” at a press conference at Interfax-Ukraine’s press center in Kyiv on Wednesday”. -Interfax. “This was the transfer of Burisma Group’s funds for lobbying activities, as investigators believe, personally to Joe Biden through a lobbying company.”
“Funds in the amount of $900,000 were transferred to the U.S.-based company Rosemont Seneca Partners, which according to open sources, in particular, the New York Times, is affiliated with Biden. The payment reference was payment for consultative services,” said Derkach. Derkach also puiblicized sums of money transferred to Burisma Group representatives – including Joe Biden’s son Hunter. “According to the documents, Burisma paid no less than $16.5 million to [former Polish President, who became an independent director at Burisma Holdings in 2014] Aleksander Kwasniewski, [chairman of the Burisma board of independent directors] Alan Apter, [Burisma independent director] Devon Archer and Hunter Biden [who joined the Burisma board of directors in 2014],” Derkach added.
“If you are represented by Mark Zaid and you’re claiming to be a whistleblower, you are not…”
• An Insult To Real Whistleblowers- Kiriakou (RCP)
Former CIA official and whistleblower John Kiriakou weighed in on Ukraine whistleblower being celebrated by the media. Kiriakou called the person a “so-called whistleblower” that is acting anonymously even though they have no undercover position at the CIA, likely an analyst. “I don’t think this is a whistleblower, not at all,” Kiriakou told FNC’s Tucker Carlson. “I think this is an anonymous source for the Democratic staff in the House of Representatives.” “You can’t hide this person’s identity just to save him from embarrassment or trouble of being recognized,” Kiriakou said. “It’s just not appropriate. If this is a whistleblower, he needs to come forward in public, testify in open session and blow that whistle.”
“Even his attorney, Mark Zaid, is one of these CIA insiders. He’s attached at the hip with the CIA. He’s represented dozens of CIA people. He has a CIA security clearance. If you are represented by Mark Zaid and you’re claiming to be a whistleblower, you are not,” Kiriakou said Wednesday.
Yup, the British are funny.
• Shell To Offset Carbon Emissions For British Fuel Buyers (R.)
Royal Dutch Shell said on Thursday it would offset the carbon dioxide emissions of around 1.5 million road users in Britain starting later this month under a loyalty scheme. Shell, like other oil companies, has come under pressure from shareholders to show how it plans to reduce its carbon footprint and help cut greenhouse gas emissions, a major cause of global warming. Britons are increasingly concerned about their environmental impact, with thousands of students striking earlier this year and green group Extinction Rebellion carrying out civil disobedience to push for more ambition on climate change.
Sinead Lynch, Shell UK country chair, said the best way for people to cut their road emissions was to use electric vehicles, supplied with renewable power. “But today the majority of people still use petrol and diesel. We can help them address the impact of their emissions by offsetting their fuel purchases,” she said in a statement. From Oct. 17, emissions relating to fuel purchased by customers with the Shell Go+ app or card will be offset for free until September 2020. Shell said about 20% of its customers were registered with the loyalty scheme. It expects the program to cost roughly 10 million pounds ($12.2 million) and offset emissions from around 1.5 million cars.
It’s too late to repair their nonsense.
• Federal Reserve Policymakers Increasingly Divided On Way Ahead (R.)
Most Federal Reserve policymakers supported the need for an interest rate cut in September, minutes of the central bank’s last policy meeting showed, but they remained divided on the path ahead for monetary policy. The readout of the meeting, released on Wednesday, also showed that the Fed agreed it would soon need to discuss increasing the size of its balance sheet following ructions in short-term money markets. Fed Chair Jerome Powell announced an imminent expansion of the central bank’s assets on Tuesday. Fed policymakers at the Sept. 17-18 meeting decided, in a 7-3 vote, to lower the benchmark overnight lending rate by a quarter percentage point to between 1.75% and 2%.
“Most participants believed that a reduction of 25 basis points in the target range for the federal funds rate would be appropriate,” the Fed said in the minutes. The U.S. central bank has lowered borrowing costs twice this year after having raised interest rates nine times since 2015. But what remains unclear from the minutes is how a softening in economic data since that meeting will affect viewpoints on the need for further rate cuts, if at all. In projections that accompanied the September statement, seven of the Fed’s 17 policymakers indicated they forecast one more rate cut this year. Five policymakers did not see any more cuts needed and the other five projected a rate rise by the end of 2019. Investors overwhelmingly expect another rate cut at the next meeting on Oct. 29-30.
Working? You sure that’s the right term?
• US Tariffs On China Are Working – Wilbur Ross (R.)
Tariffs are forcing China to pay attention to U.S. concerns, Secretary of Commerce Wilbur Ross said in Sydney on Thursday. Ross said the United States would have preferred not to implement tariffs against Chinese goods more than a year ago, but added that it has forced Beijing into action. The trade war has weighed on global growth and roiled financial markets. “We do not love tariffs, in fact we would prefer not to use them, but after years of discussions and no action, tariffs are finally forcing China to pay attention to our concerns,” Ross told a business function held by the American Chamber of Commerce in Australia. “We could have had a deal two-and-a-half years ago without going through the whole tit-for-tat on tariffs that we have.”
Top U.S. and Chinese trade and economic officials will meet in Washington on Thursday and Friday to try to end the escalating dispute. Without a significant breakthrough, Washington is set to hike the tariff rate on $250 billion worth of Chinese goods to 30% from 25% next Tuesday. Negotiators had made no progress in deputy-level trade talks held on Monday and Tuesday in Washington, the South China Morning Post (SCMP) said, citing unidentified sources with knowledge of the meetings. The two sides have been at loggerheads over U.S. demands that China improve protections of American intellectual property, end cyber theft and the forced transfer of technology to Chinese firms, curb industrial subsidies and increase U.S. companies’ access to largely closed Chinese markets.
Let’s call it a draw?
• Nearly All Goods Traded By US And China Will Have Tariffs By December 15 (R.)
U.S. and Chinese negotiators meet in Washington on Thursday and Friday to try, once again, to defuse a trade war that has roiled markets and triggered tit-for-tat tariffs on hundreds of billions of goods traded between the world’s largest economies. The meetings come days after the U.S. Department of Commerce blacklisted 28 Chinese companies, and China and the U.S. started reciprocal visa bans. Chinese officials say they have little expectation of significant progress. If negotiators cannot come to an agreement, a new set of punitive U.S. tariffs kicks in on Oct. 15 on about $250 billion of Chinese goods, and then both countries put tariffs on billions of dollars more of each others’ goods on Dec. 15. Here is what is set to take effect in the next few weeks:
U.S. OCT. 15 INCREASE A proposed Oct. 15 tariff rate boosts to 30% a duty of 25% already in place on at least $250 billion worth of Chinese imports. Set to take effect on Oct. 1, the higher tariff was delayed late in September by Trump “as a gesture of good will.” The 25% tariffs were adopted over nearly a year, from an initial tranche of largely non-consumer goods in July and August 2018, including machinery and electronic components such as semiconductors and printed circuit boards and many chemicals. Later the U.S. added consumer goods and building products, including furniture, vacuum cleaners, lighting fixtures, handbags and vinyl flooring.
U.S. DEC. 15 TARIFF INCREASE Two months later, the U.S. plans to target an additional tariff of 15% at about $300 billion in imports from China. These had already been hit with a tariff of 15% on Sept. 1, in a list mostly of consumer products, based on a Reuters analysis of 2018 U.S. Census Bureau data. It includes flat panel television sets, flash memory devices, power tools, cotton sweaters, bed linens, multifunction printers and some footwear. The largest category of targeted products covers smart watches, smart speakers, Bluetooth headphones and other internet-connected devices spared in a prior round of tariffs, with Chinese imports estimated at $17.9 billion annually by the Consumer Technology Association.
The numbers are not that impressive, but the trends are clear.
• Chinese Consumers Are On A Worrying Staycation (Lam)
China is shopping, just not quite enough. Official numbers after a week-long National Day break showed revenue from domestic tourism climbed 8.5% compared to 2018, the slowest pace in at least 17 years. Retail and dining numbers also failed to dazzle. Beijing wants consumers to help revive a flagging economy, but a weak yuan and the fading impact of tax cuts will keep purse strings tight. Golden Week, which began on Oct. 1, has long offered a snapshot of Chinese consumption. This year, the picture is less than shiny. Spending on retail and dining was up 8.5% compared to a 9.5% increase last year according to Citi, and well below double-digit increases a decade ago. Growth in domestic travel cooled too.
Some 7 million Chinese still ventured overseas, a measure of the country’s increasing wealth, but the number of outbound travellers in the first six days of October fell 15% compared to a year ago. In part that was due to China’s anniversary celebrations, and Hong Kong hardly helped: anti-government protests there have prompted numbers coming over the border to fall precipitously. But it measures wider household concerns. Instead, it was the small luxuries that did well, like trips to the movies. Patriotic flicks including ‘My People, My Country’ – stories inspired by China’s history – drew record box office revenue and over 100 million viewers during the holiday, according to Xinhua.
Beijing, which usually leans on infrastructure to stimulate the economy, has increasingly turned to consumers too. Stimulus measures, including a personal income tax unveiled late last year, did help lift disposable incomes by 8.8% in the first half. That would have been 7.2% without the boost, reckons analyst Ernan Cui of Gavekal Dragonomics. Unfortunately, that’s not feeding into shopping baskets fast enough, given it impacted wealthier households more.
The very idea of “privately outsourced incarceration” is so insane we should never even consider it.
• California Set To End Private Prisons And Immigrant Detention Camps (R.)
America’s largest state prison system is moving to quit the practice of farming out inmates to lockups run under contract by private companies, following a nationwide decline in the for-profit incarceration business. California Governor Gavin Newsom is expected to sign legislation this week designed to effectively ban private, for-profit corporations from running prisons or immigration detention facilities. Sponsors of the measure say it will end a brief but hapless experiment in privately outsourced incarceration begun as a means to ease overcrowding – an endeavor Newsom branded an outrage when he took office in January.
Bill supporters say private prisons, driven to maximize shareholder profits, lack proper oversight or incentives to rehabilitate inmates, and have contributed to a culture of mass incarceration by making it cheaper to lock up people. They point to research cited in a 2016 U.S. Justice Department Office of Inspector General report that found private prisons spend less on personnel, and are less safe, than public institutions. “This is a total and complete failure, and it’s hurting and abusing Californians,” said state Assemblyman Rob Bonta, a chief author of the bill.
Yeah, well, the horse and the barn.
• Owner Of Spanish Security Company That Spied On Assange Arrested (El Pais)
David Morales, the owner of the Spanish security company that was in charge of protecting the Ecuadorian embassy in London while Julian Assange was living there, has been arrested and released on bail, judicial sources have told EL PAÍS. The director of UC Global S. L. is being investigated by Spain’s High Court, the Audiencia Nacional, after allegedly ordering the private conversations of the WikiLeaks founder to be spied on, as well as supposedly passing the information collected to the United States’ intelligence services. Morales’ arrest took place on September 17 in the southern Spanish city of Jerez de la Frontera, which is where the security firm is based. The information had not come to light until now given that the investigation is under seal.
Police officers searched the company’s offices and also seized hard disks and documents, all of which are now being analyzed by the judge in charge of the case, José de la Mata. According to judicial sources, two firearms with their serial numbers erased were found in Morales’ home, as well as €20,000 in cash. Morales was taken to Madrid were he was questioned at the High Court before being released on bail. His passport was taken from him and his bank accounts frozen. He currently has to check in at the High Court every two weeks. [..] After the revelations were published by EL PAÍS, Assange’s defense team filed a criminal complaint against Morales, in which he is accused of alleged privacy offenses as well as the violation of attorney-client privilege, misappropriation of funds, bribery and money laundering.
A glimpse of your future.
• PG&E Power Outage: Lines For Gas, Batteries, Groceries And Generators (LAT)
The massive blackouts imposed across Northern California on Wednesday led to a run on gasoline, portable generators and other supplies while retailers struggled to serve customers. Millions were expected to lose power as Pacific Gas & Electric shut down service in a bid to avoid wind-driven fires caused by downed power lines. Angie Sheets of El Dorado Hills outside Sacramento noticed that generators were flying off the shelves at the local Costco as she shopped for groceries earlier in the week. Considering the nearly $1,000 worth of food she planned to purchase and the imminent power outage, Sheets said she called her husband to talk about buying a generator for their home. “By the time I had done that, the last big generator was gone off the shelves,” she said. Her husband, a law enforcement officer, later found a generator at a Costco in Rancho Cordova.
You sure it wasn’t Putin? How about Ukraine?
• Seven Latam Nations Suggest Maduro Behind Unrest In Ecuador (R.)
Seven Latin American countries reject any attempt by Venezuelan President Nicolas Maduro to destabilize democracies in the region and back Ecuadorean President Lenin Moreno as he tries to calm unrest, Peru’s foreign ministry said on Tuesday, speaking on behalf of the group. A statement from the Peru’s foreign ministry said that it as well as Argentina, Brazil, Colombia, El Salvador, Guatemala and Paraguay all expressed their “firm backing for actions taken by President Lenin Moreno” and “reject any action aimed at destabilizing our democracies by the regime of Nicolas Maduro.”
Still bankrupt though.
• For The First Time Ever, Greece Issues Negative Yielding Debt (ZH)
As armies of fixed income strategists battle over whether US Treasuries are facing higher or lower yields, Greece has no such qualms and in a historic shift today, the former bond market pariah and Eurozone’s most indebted nation, joined the exclusive club of negative-yielding European nations when bond investors lined up to pay the nation that was at the heart of Europe’s sovereign debt crisis. A sale of €487.5 million of 13-week bills on Wednesday drew Greece’s first-ever negative yield of minus 0.02% as investors now pay Athens for the privilege of lending it cash, as Bloomberg first reported. Greece joins the likes of Ireland, Italy and Spain – not to mention virtually all core Eurozone nations – which benefit from the ECB’s insane monetary policy and deepening fears of a global recession.
It’s been an unprecedented turnaround for twice bankrupt Eurozone member, whose bondholders suffered massive losses back in March 2012 when the country was forced to accept the biggest bond restructuring in history, bringing the Eurozone to the verge of collapse. Just a few years and several trillions in bond purchases by the ECB later, the region is grappling with an altogether different problem – the spread of negative yields, which reduces borrowing costs for governments in a form of soft default, one which is crushing savers, pension funds and insurers, and which has prompted some of the most respected names in finance to shriek in terror as the cost of money in even Europe’s most insolvent nations is now negative.
