Jan 182019
 
 January 18, 2019  Posted by at 10:16 am Finance Tagged with: , , , , , , , , , , , , , ,  


Pablo Picasso Mother and child at the seaside 1922

 

Demand For Credit Cards And Mortgages In UK Falling Fast (G.)
May’s 10-Year Plan ‘Still Not Enough’ To Save NHS – (Ind.)
May Tells Corbyn It Is ‘Impossible’ To Rule Out No Deal (G.)
Run Down the Brexit Clock (Varoufakis)
Nigel Farage Urges Brexiteers To Prepare For Second Referendum (PA)
More Countries To Cut Down Their Belt And Road Investments (CNBC)
China’s Slowing Economy Takes Hong Kong’s Housing Market Down With It (BI)
Germany ‘Looks To Ban Huawei’ From 5G Build (BBC)
Huawei Funding Suspended By Oxford University (PA)
Alexandria Ocasio-Cortez Teaches Fellow Democrats How To Use Twitter (Ind.)
How We’ll Pay For Green New Deal Isn’t ‘A Thing’ – Nor Is Inflation (F.)
Another Good Day For Putin As Turmoil Grips US and UK (CNN)
Putin Stole Santa’s Home (F.)

 

 

It’s certainly true that Nancy Pelosi gets more popular because she opposes Trump. In the same way that the NYT and CNN got milliions more viewers and readers by echo-chambering their Trump ‘resistance’.

But still, if she refuses to hold the State of the Union, Trump simply takes her plane away. Being more popular in the echo chamber isn’t the same as being popular. So many Americans, in media, politics, and in the street, have lived in their echo chambers for so long, they think it’s the entire country. That is not true.

Yes, Britain should wean off personal debt as much as any nation. But do it too fast and your engines fail and bring you to a full standstill.

Demand For Credit Cards And Mortgages In UK Falling Fast (G.)

Borrowing on credit cards is expected to plunge to the lowest levels since 2007 in the three months before Brexit, according to the Bank of England, in another indication of stresses facing the UK economy. According to the latest quarterly health check on credit conditions from Threadneedle Street, high street banks forecast borrowing on plastic will decline in the first quarter by the most since records began 12 years ago. It comes amid growing concern over consumer spending on the high street after the worst Christmas for retailers since the financial crisis, setting the economy up for a weak first quarter. The Bank said its measure of demand for credit card lending over the three months to the end of March dropped to -20.7 from -7.2.

Its gauge for mortgage lending also dropped to -17.5 in the final quarter of 2018, from -0.2 in the third quarter, its lowest level since the end of 2010. The looming threat of a no-deal Brexit in less than 80 days dragged down the UK property market further in December, according to a report from Britain’s top surveyors, with prices falling at the fastest rate in six years and the outlook for sales the weakest in two decades. Economists said that the drop in mortgage lending likely reflected banks reining in their lending in response to the risk of a no-deal Brexit, with Threadneedle Street warning that prices could drop by almost a third. Despite the warnings, prices have continued to rise sharply in some parts of the UK, including Manchester and Birmingham, even as the value of homes in London stalls or declines.

Read more …

May’s legacy: failed Brexit, hostile environment and murder of a reasonably well functioning health system.

May’s 10-Year Plan ‘Still Not Enough’ To Save NHS – (Ind.)

The NHS is financially “unsustainable” and the government’s much-trumpeted 10-year plan is inadequate to rescue cancer, mental health and social care services, the National Audit Office (NAO) has warned. Years of underinvestment have resulted in longer waiting times, critical staff shortages and “substantial deficits” that have been covered up by raiding funds for long-term reform, an NAO review found. These factors “do not add up to a picture that we can describe as sustainable”, it said. NHS England’s recently published 10-year plan sets out how it aims to spend the pledged £20.5bn increase in its budget by 2023 to break this cycle.

But the NAO warns its success is dependent on the government producing – and funding – a long-delayed plan to reform social care and an estimated £6bn repair bill to fix run-down buildings. While NHS England expects to bring in thousands of staff from overseas to fill gaps, the report says ambitions to transform services will require significant additional growth. “The NAO has laid bare just how difficult it will be to achieve the ambitions of the NHS long-term plan given where the NHS is starting from,” Richard Murray, chief executive of the King’s Fund think tank, said. With health services finances “bedevilled by short-term fixes, fragile workarounds, and unrealistic expectations”, he said the NAO was right to make clear the government’s flagship investment is not an NHS panacea.

[..] key decisions about the future of waiting-time standards such as the four-hour treatment target in A&E departments have been deferred to a separate report. Auditors warned more than £700m will be required just to bring the NHS surgical waiting list down from a 10-year high of more than 4.3 million, to March 2018 levels. A workforce plan has also been delayed and the report says: “There is a risk that the NHS will be unable to use the extra funding optimally because of staff shortages.” This is because scarce funds are currently being squandered on costly agency staff to plug more than 100,000 vacant posts, and there could be too few people in key roles – like cancer or community services – to deliver its goals.

Read more …

May rules out a customs union and a second referendum, but not a “no deal”. Is that impossible, or merely her ‘principles’?

“..the prime minister was determined to stick to her “principles” on Brexit, including rejecting a customs union and a second referendum.”

May Tells Corbyn It Is ‘Impossible’ To Rule Out No Deal (G.)

Theresa May has told Jeremy Corbyn his demand that she rule out a no-deal scenario as a prerequisite for Brexit talks is “an impossible condition” and called on him to join cross-party discussions immediately. In a letter to Corbyn on Thursday afternoon, written after the Labour leader dismissed her request for talks as a “stunt”, May said that she would be “happy to discuss” the Labour leader’s ideas. She urged him to “talk and see if we can begin to find a way forward for our country on Brexit”. Referring to Corbyn’s instruction to Labour MPs not to meet with her, May asked: “Is it right to ask your MPs not to seek a solution with the government?”

The proposed talks have been stymied by Corbyn’s insistence that a no-deal must be ruled out as a precondition and May’s insistence that doing so would not be workable. In her letter she wrote: “It is not within the government’s power to rule out no deal.” May has been meeting other party leaders in the aftermath of the resounding defeat for her Brexit plan in the House of Commons earlier this week. A number of Labour MPs have defied their leader’s instruction not to engage in discussions designed to find a plan that might command a majority. Earlier, Downing Street insisted the prime minister was determined to stick to her “principles” on Brexit, including rejecting a customs union and a second referendum.

With the clock running down to Brexit day on 29 March, May kicked off Thursday’s talks with the Green party MP, Caroline Lucas. May’s official spokesman insisted these conversations would be approached “in a constructive spirit, and wanting to hear what the various groups have to say”. But when asked whether May was willing to flex any of her negotiating red lines, he said they remained in place.

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Yanis inserts a bit of -much needed- game theory into the debate. A deadline defeats the process, because there will be nothing happening before the deadline.

Run Down the Brexit Clock (Varoufakis)

Members of Parliament deserve congratulations for keeping their cool in the face of a made-up deadline. That deadline is the reason why Brexit is proving so hard and potentially so damaging. To resolve Brexit, that artificial deadline must be removed altogether, not merely re-set. [..] Once we are at, or close to March 29, heightened urgency will dissolve tactical procrastination. May’s deal will have bitten the dust, and Remainers will be closer to accepting that time is not on the side of a Brexit-annulling second referendum, perhaps turning their attention to the legitimate aim of a future referendum to re-join the EU.

At that point, government and opposition will recognize that only two coherent options remain for the immediate future. The first is Norway Plus, which would mean Britain would remain for an indeterminate period in the EU single market (like Norway), and also in a customs union with the EU. The second is an immediate full exit, with Britain trading under World Trade Organization rules while Northern Ireland remains within a customs union with the EU to avoid a hard border with the Republic of Ireland. Narrowing it down to two options will enable Parliament to choose. Once MPs acknowledge that freedom of movement between the UK and the EU is a red herring, the most likely outcome is Norway Plus for an indeterminate, deadline-free period.

Then and only then will Parliament and the people have the opportunity to debate the large-scale issues confronting Britain, not least the future of the UK-EU relationship. Norway Plus would, of course, leave everyone somewhat dissatisfied. But, unlike May’s deal or a hasty second referendum, at least it would minimize the discontent that any large segment of Britain’s society might experience in the medium term. And, because minimizing the discontent, along with a deadline-free horizon, are prerequisites for the people’s debate that Britain deserves, the overwhelming defeat of May’s deal may well be remembered as a vindication of democracy.

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It wouldn’t get more toxic that that.

Nigel Farage Urges Brexiteers To Prepare For Second Referendum (PA)

Nigel Farage has urged Leave campaigners to prepare for a second referendum as Britain’s Brexit deadlock continues. The former Ukip leader spoke at a packed Leave Means Leave rally in London, alongside former Conservative leader Iain Duncan-Smith, MP Esther McVey and Hotelier Rocco Forte. Mr Farage said he believed “it is now quite possible that we will see an extension of Article 50”. He added: “When I’ve talked in the past about being worried that they may force us into a second referendum. I don’t want it anymore than you do but I am saying to you we have to face reality in the face. Don’t think the other side aren’t organised, don’t think the other side aren’t prepared, don’t think they haven’t raised the money, don’t think they haven’t got the teams in place, they have.”

The audience at the Leave Means Leave rally were fired up and heckling throughout the nights speeches. Mr Duncan-Smith said Britain’s “greatness” lies in the post-Brexit future. He added: “I love this country dearly, I love it with all my heart. I love people whether they’re Remainers or Leavers, I don’t care. But I know one thing, this country’s greatness lies ahead of it and we have an opportunity and a duty to deliver it. I pledge to you tonight, I will not sleep, I will not rest, I will not wake to find a Britain that is otherwise than independent and free once again.” He branded the European Union a “political project that we have never fully been told the truth about” and described anti-Brexit arguments as “a load of rubbish”.

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As I’ve been saying for a while. “The phenomenon has been dubbed debt-trap diplomacy.”

More Countries To Cut Down Their Belt And Road Investments (CNBC)

Some countries are scaling down or scrapping entire projects that are part of China’s Belt and Road Initiative amid mounting financial concerns over the continent-spanning venture. In recent months, developing nations such as Pakistan, Malaysia, Myanmar, Bangladesh and Sierra Leone have either canceled or backed away from previously negotiated BRI commitments, citing worries over high project costs and their impact on national debt and the economy. That revised stance not only confirms global fears over the terms of BRI financing, it could also indicate that developing countries are now more willing to prioritize sovereign interests over their need for foreign investment.

The BRI — Beijing’s signature foreign policy program — is the superpower’s attempt to stretch its economic power across the globe through the construction of maritime and overland transportation links across Asia, the Middle East, Africa and Europe. But critics see it as a means to benefit China’s military, increase opportunities for Chinese companies and help Beijing gain political leverage. Under the trillion-dollar endeavor, Chinese state-owned entities flush with cash offer participating countries cheap loans and credit to build large-scale projects such as ports and railways.

[..] Many of these countries want to avoid the same fate as Sri Lanka. Shock waves rippled throughout the developing world when Colombo handed over a strategic port to Beijing in 2017, after it couldn’t pay off its debt to Chinese companies. It was seen as an example of how countries that owe money to Beijing could be forced to sign over national territory or make steep economic concessions if they can’t meet liabilities. The phenomenon has been dubbed debt-trap diplomacy

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The biggest housing bubble of them all.

China’s Slowing Economy Takes Hong Kong’s Housing Market Down With It (BI)

One of the world’s most expensive housing markets is facing a major slowdown. Analysts at HSBC dimmed their outlook for Hong Kong’s real-estate market on Wednesday, according to a research note. Previously forecasting activity would plateau, they now estimate prices will fall from 10% to 15% over the next six months. “We expect the first half of 2019 to be a challenging period for the Hong Kong housing market,” the analysts said. “Prices have already corrected 8% from the recent peak in August 2018 due to macro uncertainties and several events occurring in the property market that concerned investors.”

Hong Kong was ranked the most-expensive housing market in the world for eight consecutive years, benefitting from capital controls in mainland China that incentivize real-estate investments closer to home. But activity has slowed sharply in recent months, with property values falling by the most since the global financial crisis in 2008 in November. With China’s economy expected to continue to lose steam in coming months, the housing market looks poised to fall further. [..] Also helping to bring prices down from August highs, a vacancy tax aimed at discouraging investors from holding empty Hong Kong homes was introduced last year. Still, some are confident residential real estate activity will start to recover despite a slowing economy, with HSBC predicting annual price drops to shrink to between 5% and 10% by the end of the year.

Read more …

It’s about our intelligence controlling us. We don’t want Chinese intelligence to do that, and the only alternative we have is the CIA, MI6 etc.

Germany ‘Looks To Ban Huawei’ From 5G Build (BBC)

Germany is considering ways to block Huawei from its next generation mobile phone network, according to reports. Berlin is exploring stricter security requirements which may prevent Huawei products being used in its 5G network. Many countries have pushed against the involvement of the Chinese technology firm in their 5G networks over security concerns. The networks represent the next big wave of mobile infrastructure. The Chinese company, one of the world’s biggest producers of telecoms equipment, has faced resistance from foreign governments over the risk that its technology could be used for espionage. Huawei has denied claims it poses a spying risk.

Germany’s interior ministry had previously said it opposes banning any suppliers from its 5G network. But it may consider stricter security requirements and other ways to exclude Huawei, according to reports. Such a move would bring it in line with other Western countries. The Australian government has banned Huawei from providing 5G technology to its wireless networks, while New Zealand blocked a proposal to use its telecoms equipment over national security concerns. The US and UK have raised concerns with Huawei, and the firm has also been scrutinised in Japan and Korea.

Read more …

Some people have all the funding they need.

Huawei Funding Suspended By Oxford University (PA)

Oxford University is suspending research grants and funding donations from Huawei, amid growing security concerns about the Chinese firm’s telecommunication technology. Existing research contracts already received or committed with Huawei will go ahead, but the university will not pursue new funding opportunities with the company. There are two ongoing projects in which Huawei has committed £692,000, the university said.

“Oxford University decided on January 8 this year that it will not pursue new funding opportunities with Huawei Technologies Co Ltd or its related group companies at present,” an Oxford University spokesman said in a statement. “Huawei has been notified of the decision which the university will keep under review. The decision applies both to the funding of research contracts and of philanthropic donations. “The decision has been taken in the light of public concerns raised in recent months surrounding UK partnerships with Huawei. We hope these matters can be resolved shortly and note Huawei’s own willingness to reassure governments about its role and activities.

Read more …

The Democrats have their own Trump. But they don’t understand how that works, and personal desire for power is far too great amongst the octogenarians (or soon to be) anyway.

Alexandria Ocasio-Cortez Teaches Fellow Democrats How To Use Twitter (Ind.)

There are some things, such as courage and a sense of humour, that you cannot teach. But becoming a titan of social media? That may just be possible to learn. Such is the hope, at least, of Democrats on Capitol Hill, who have undergone a class in how to tweet more effectively, from Alexandria Ocasio-Cortez, the veritable Twitter superpower. “With @AOC, @RepDebDingell, @jahimes, @davidcicilline, @RepCartwright & @Twitter representatives at training session on Twitter for Democratic Members of Congress,” tweeted California congressman Ted Lieu, after the lesson. “The below pic is called a selfie.”

Nobody in the Democratic party – Michelle and Barack Obama included – has as much Twitter power as the 29-year-old congresswoman of New York’s 14th district. Axios reported recently that from December 11 2018, to January 11 2019, Ms Ocasio-Cortez, had 11.8m Twitter interactions, second only to Donald Trump, – who had 39.8m – among politicians or the news media. Senator Kamala Harris was third with 4.6m, Barack Obama was fourth with 4.4m, and CNN came fifth with 3.1m.

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Robert Hockett is professor of Law and Public Policy at Cornell University. “How will we pay for it?” is not that interesting. “What’s in it?” is a much better question.

I don’t think I’m going to like the answer. Because I don’t think the people proposing the various Green New Deals can see sufficiently across the wide range of fields involved: finance, pollution, energy, politics, psychology etc.

How We’ll Pay For Green New Deal Isn’t ‘A Thing’ – Nor Is Inflation (F.)

Representative Alexandria Ocasio-Cortez’s announcement of an ambitious new Green New Deal Initiative in Congress has brought predictable – and predictably silly – callouts from conservative pundits and scared politicians. ‘How will we pay for it?,’ they ask with pretend-incredulity, and ‘what about debt?’ ‘Won’t we have to raise taxes, and will that not crowd-out the job creators?’ Representative Ocasio-Cortez already has given the best answer possible to such queries, most of which seem to be raised in bad faith. Why is it, she retorts, that these questions arise only in connection with useful ideas, not wasteful ideas? Where were the ‘pay-fors’ for Bush’s $5 trillion wars and tax cuts, or for last year’s $2 trillion tax giveaway to billionaires?

Why wasn’t financing those massive throwaways as scary as financing the rescue of our planet and middle class now seems to be to these naysayers? The short answer to ‘how we will pay for’ the Green New Deal is easy. We’ll pay for it just as we pay for all else: Congress will authorize necessary spending, and Treasury will spend. This is how we do it – always has been, always will be. The money that’s spent, for its part, is never ‘raised’ first. To the contrary, federal spending is what brings that money into existence. If years of bad or no economic education make that ring counterintuitive to you, you’re not alone: politicians and pundits who ought to know better are with you. But the problem is readily remedied: just take a look at a dollar (or five dollar, or ten dollar, or … dollar) bill.

The face you see is George Washington’s – a public official’s – not yours or some other private sector person’s. The signatures you’ll find, for their part, are those of the Treasurer and the Treasury Secretary, not yours or some other private sector person’s. And the inscription you’ll read across the top is ‘Federal Reserve Note,’ not ‘Private Sector Sally’s Note.’ ‘Note’ here, note carefully, means ‘promissory note.’ Money betokens a promise. Hence money’s relation to credit. We’ll come back to this later. The money that Treasury spends is, in any event, jointly Fed- and Treasury-issued, not privately issued. That is to say it’s the citizenry’s issuance, not some single citizen’s issuance. It’s like a promise we make to each other. Hence the term ‘full faith and credit’ you’ll hear about when asking what ‘backs’ our currency and our Treasury securities.

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A narrative repeated so often most people will think it must be at least partly true. But then there’s this very curious line: “Whether the political distemper in the West was sown by a Russian intelligence operation masterminded by Putin may not matter because he is making a belated effort at winning the peace after the end of the Cold War.”

Another Good Day For Putin As Turmoil Grips US and UK (CNN)

The news just keeps on getting better for Vladimir Putin. On either side of the Atlantic, the United States and Britain, the two great English-speaking democracies that orchestrated Moscow’s defeat in the Cold War, are undergoing simultaneous political breakdowns. And the Russian leader may have had a hand in triggering the turmoil.

The allies are experiencing the reverberations of populist revolts that erupted in 2016 – in the Brexit vote and the election of Trump – and are now slamming into legislatures and breeding division and stasis. The result is that Britain and the United States are all but ungovernable on the most important questions that confront both nations. That’s music to Putin’s ears. The Russian leader has made disrupting liberal democracies a core principle of his near two-decade rule, as he seeks to avenge the fall of the Soviet empire, which he experienced as a heartbroken KGB agent in East Germany. Russia has been accused of meddling in both the Brexit vote and the US election in 2016 – the critical events that fomented the current crisis of the West.

Over the last five years, Putin has defied Western scorn about Russia’s frayed economic power and made the best of a bad hand, working to re-establish influence in the former Soviet orbit. He has seized Crimea from Ukraine and restored Moscow’s former political beachhead in the Middle East. In the last two years, Putin has had a witting, or unwitting, ally in Trump, whose attacks on NATO and US allies and decision to pull US troops out of Syria played into Russia’s goals. Whether the political distemper in the West was sown by a Russian intelligence operation masterminded by Putin may not matter because he is making a belated effort at winning the peace after the end of the Cold War.

Read more …

Original headline was “The Magnetic North Pole Has Moved. Here’s What You Need To Know”, but obviously this alternative one, phrased by someone on Twitter, is so much better.

Other than that, I’m curious to know how this affects animals that use magnetic poles, like migrating birds and insects. Unfortunately, the article doesn’t address the issue.

Putin Stole Santa’s Home (F.)

Earth’s magnetic pole is moving in the direction of Siberia and away from Canada. This is something that scientists have been tracking for a long time. It’s fairly easy to look up the location of the magnetic pole dating back to the early 1900s. The recent changes of the drifting pole are raising some concerns but the direction is not the problem. In fact, the direction of the drifting pole has been roughly the same for as long as scientists have been tracking it. The speed is the issue. Every five years scientists recalculate the location of the magnetic pole. This is important information for global navigation, which includes GPS satellites and other technology. These changes can make a big difference in our everyday lives.

The movement of the pole is caused by flows of molten liquid iron in the Earth’s core. This liquid and how it moves creates the Earth’s magnetic field. Variations in the liquid flow cause the magnetic field to change over time and cause the location of magnetic north to move. The global model was off because of a geomagnetic pulse the occurred beneath South America in 2016. This pulse just came at a bad time. The 2015 World Magnetic Model was brand new and not scheduled to be renewed until 2020. It seems that in the future we may not be able to wait as long between updates. The poles movement has sped up in recent memory from 9 miles a year in the 1990s to about 34 miles a year at present day.

Read more …

Dec 192018
 
 December 19, 2018  Posted by at 10:01 am Finance Tagged with: , , , , , , , , , , ,  


Francisco Goya Fire at night 1793-94

 

Fed Expected To Move Forward With Rate Hike, Despite Trump (CNBC)
Has “BTFD” Become “STFR”? (Roberts)
Oil Slump Could Get Much Worse Amid Oversupply Concerns (CNBC)
Alan Greenspan Has A New Warning For Investors: ‘Run For Cover’ (CNBC)
Revenge Of The Spies: Flynn Case Shows Extent Of Anti-Trump #Resistance (Malic)
This Radical Plan to Fund the ‘Green New Deal’ Just Might Work (Ellen Brown)
Thousands Of British Troops On Standby For No-Deal Brexit (Ind.)
New ‘Integrity Initiative’ Leaks: Military Ties, Infiltration of European Media (RT)
Either The EU Ditches Neoliberalism Or Its People Will Ditch The EU (Wight)
Belgian PM Charles Michel Resigns After No-Confidence Motion (G.)
France, Hungary, Serbia: Is Half Of Europe Protesting? (DW)
Hungary’s Opposition Plans More Protests After ‘Slave Law’ Passes (G.)
One of Earth’s Largest Living Things Even Bigger Than Previously Thought (Ind.)

 

 

As long as Powell hints that hikes will be slower, the ‘markets’ will cheer.

Fed Expected To Move Forward With Rate Hike, Despite Trump (CNBC)

The Federal Reserve is expected to raise interest rates by a quarter point Wednesday and also signal it will not be raising rates as much as it had previously forecast. Strategists say that may soothe volatile financial markets, but the Fed has a tough task in terms of explaining its actions in a way that will not sound too alarmist about the economy or too unconcerned about deteriorating financial conditions. The Fed will be taking the fed funds rate range to 2.25 to 2.50 percent, and Fed watchers expect it to remove language in its post-meeting statement that says it will continue with ‘gradual’ rate increases.

According to its forecast, the Fed was expected to raise interest rates three more times next year, but economists now expect that will change to show two more hikes next year, with another possible in 2020. “The economy is decelerating. They were too optimistic on their outlook, but by the same token, they’re going to have to walk a fine line that they’re not overly concerned. They’re just going to take it down a notch,” said George Goncalves, head of fixed income strategy at Nomura. The Fed’s rate hike is coming against a backdrop of financial market turbulence. Markets have been reacting to concerns about rising interest rates as well as concerns trade wars and weaker global data could lead to a recession.

Fed Chairman Jerome Powell, unlike other Fed chairs, has also faced a stream of criticism from the White House, with President Donald Trump protesting rate hiking policy and in a tweet on Tuesday, the Fed’s balance sheet policy. “I do think the Fed will try and likely succeed in sending a comforting tone to the equity market. I think the market is forcing the Fed to deliver a very dovish hike. We think 2019 dots will come to two. 2020 will show one hike but just above 3 percent. The Fed will make some changes to show they are less on a pre-set course and more data dependent,” aid Mark Cabana, head of U.S. short rate strategy at Bank of America Merrill Lynch.

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“..what happens when these algo’s reverse course and rather than “buying the f***ing dip,” they begin to “sell the f***ing rallies” instead..?”

This is where I leave Lance Roberts behind. That graph simply tells me, to the extent that further graphs lose their meaning, that every single thing, the only thing, that happened since 2009 was central banks.

Has “BTFD” Become “STFR”? (Roberts)

Kevin Wilson recently penned a piece for Seeking Alpha that made a great point about where the markets are currently. To wit: “Famous market observer Art Cashin mentioned a metaphor in October 2017 that resonated with me. He said (words to the effect that) at that moment, market players had only the protection provided by pictures of lifeboats, not the lifeboats themselves. This is just like the Titanic, whose measly 16 lifeboats looked nice, but left many hundreds on board with no means of escape when the ship sank. That is the current market situation in a nutshell. Players seem to believe that their positions are diversified enough to protect them in a downturn, and in any case, many appear to expect no major drawdown in spite of many months of extreme volatility. I would argue that the risk is far greater than perceived by many, and the protections most have in place are quite inadequate.”

Indeed, that is the case. As I noted in this past weekend’s newsletter, while the S&P 500 has declined only marginally for 2018, the devastation across markets has been dramatically worse. In other words, traditional diversification, which is considered the “defacto” portfolio protection strategy by the mainstream media, has not worked. Over the last several weeks, I have been discussing the transition of the market from “bullish” to “bearish.” “The difference between a ‘bull market’ and a ‘bear market’ is when the deviations begin to occur BELOW the long-term moving average on a consistent basis.”

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There goes the Saudi budget: ‘Uncertainty and volatility reign once again. ‘

Oil Slump Could Get Much Worse Amid Oversupply Concerns (CNBC)

Oil prices are likely to fall even further over the coming weeks, analysts told CNBC Tuesday, as a sharp sell-off in global equities combines with intensifying fears about a market that could soon to be awash with crude. The latest wave of energy market selling comes amid reports of swelling inventories and forecasts of record U.S. and Russian output. Heightened worries of a possible economic slowdown in 2019 have also added downward pressure to the value of a barrel of oil. “The only way is down,” Tamas Varga, senior analyst at PVM Oil Associates, said in a research note published Tuesday.

“There are lots of variables regarding next year’s oil balance but based on available data, information and sentiment, it is fair to say that any price rally will be met by fierce resistance from the sellers’ side,” Varga said. Brent crude fell as much as 4 percent to as low as $57.20 a barrel on Tuesday, on track to register its third consecutive session of declines. The international benchmark has since trimmed some of its losses to trade down 2.7 percent. Meanwhile, U.S. West Texas Intermediate (WTI) dipped further below $50 a barrel on Tuesday, after settling below the psychologically important level for the first time in more than a year in the previous session. U.S. crude stood at $47.94 at around 11:00 a.m. ET, trading 4 percent lower.

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Scrooge and the Grinch in one person.

Alan Greenspan Has A New Warning For Investors: ‘Run For Cover’ (CNBC)

Alan Greenspan, the former Federal Reserve chief who called out the tech-fueled rally of the mid-1990s as “irrational exuberance,” is now giving investors a new warning. In a CNN interview, Greenspan said it was unlikely that the current market would stabilize and then take another big leg higher. “It would be very surprising to see it sort of stabilize here, and then take off again,” Greenspan said. Markets could still go up, but “at the end of that run, run for cover.” Greenspan told CNN the bull market is over, pointing to how stocks have fumbled in recent days.

On Tuesday, stocks rallied but they tumbled on Monday and have been in a decline since October, weighed by concerns over global trade conflict and slowing global economies. The S&P was on track, as of Monday’s close, for the worst December since 1931. [..] In the CNN interview, Greenspan said the U.S. could be headed into “stagflation,” an economy characterized by high inflation and high unemployment such as was seen in the 1970s. “How long it lasts or how big it gets, it’s too soon to tell.”

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Strangest thing for me yesterday was the judge accusing Flynn of treason, only to apologize for that accusation minutes later.

Revenge Of The Spies: Flynn Case Shows Extent Of Anti-Trump #Resistance (Malic)

President Donald Trump’s ill-fated first national security adviser Michael Flynn will twist in the wind for another three months or more, before he can face a sentence for getting caught in a FBI ambush while doing his job. Flynn was supposed to be sentenced on Tuesday, ending the year-long legal saga that destroyed his reputation, nearly bankrupted him, and even endangered his family. Then, in a bizarre last-minute twist, his lawyers asked for a delay. The next status hearing will be in March, with the actual sentencing who knows when. At one point in the hearing, Judge Emmett Sullivan urged Flynn to reconsider his guilty plea, telling him that the violation he was admitting to amounted to treason – only to walk back the comments minutes later.

The media, predictably, gave far more coverage to the original statement than the retraction. It’s the perfect example of the collective hysteria that has followed Flynn’s case from the very beginning. Despite the publication of FBI documents showing that agents interviewing Flynn in January 2017 did not think he misled them, intentionally or otherwise, about the content of his conversations with Russian ambassador to the US Sergey Kislyak, Flynn chose to stand by his guilty plea from a year ago. His reasons for this are a mystery. What is not a mystery, however, is how the people involved in railroading Flynn are the same ones implicated in the institutional #Resistance to the Trump administration.

[..] In the orgy of sensationalist reporting that has gripped the US mainstream media for the past two years, Flynn’s actual transgression has been lost to the din of shouting “treason” and “RUSSIA.” What he pleaded guilty to is lying to FBI investigators about his calls with Kislyak. The contacts themselves were right and proper, mind you: it was literally his job to reach out to foreign diplomats on behalf of the president-elect. So, why was the FBI even probing them?

That is where things get interesting. Somebody from the Obama administration – we still don’t know who – “unmasked” Flynn’s name from the classified NSA intercepts of his conversations with the Russian ambassador. This somehow got to Acting Attorney General Sally Yates, who testified that she reached out to the White House with concerns about Flynn being blackmailed. It also somehow got to the Washington Post. There was talk of the Logan Act, an obscure 200-year-old law never used to prosecute anyone.

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I have a bunch of questions and doubts, but I like Ellen Brown.

Question 1: Is it a good idea to spend trillions on Green New Deals? How much of it would be geared towards decreased energy use?

Question 2: Is Abenomics really the success Ellen claims it is?

This Radical Plan to Fund the ‘Green New Deal’ Just Might Work (Ellen Brown)

[..] the “Green New Deal” promoted by Rep.-elect Alexandria Ocasio-Cortez, D-N.Y., appears to be forging a political pathway for solving all of the ills of society and the planet in one fell swoop. Her plan would give a House select committee “a mandate that connects the dots” between energy, transportation, housing, health care, living wages, a jobs guarantee and more. But even to critics on the left, it is merely political theater, because “everyone knows” a program of that scope cannot be funded without a massive redistribution of wealth and slashing of other programs (notably the military), which is not politically feasible.

A network of public banks could fund the Green New Deal in the same way President Franklin Roosevelt funded the original New Deal. At a time when the banks were bankrupt, he used the publicly owned Reconstruction Finance Corp. as a public infrastructure bank. The Federal Reserve could also fund any program Congress wanted, if mandated to do so. Congress wrote the Federal Reserve Act and can amend it. Or the Treasury itself could do it, without the need to even change any laws. The Constitution authorizes Congress to “coin money” and “regulate the value thereof,” and that power has been delegated to the Treasury. It could mint a few trillion-dollar platinum coins, put them in its bank account and start writing checks against them.

What stops legislators from exercising those constitutional powers is simply that “everyone knows” Zimbabwe-style hyperinflation will result. But will it? Compelling historical precedent shows that this need not be the case. Michael Hudson, professor of economics at the University of Missouri-Kansas City, has studied the hyperinflation question extensively. He writes that disasters such as Zimbabwe’s fiscal troubles were not due to the government printing money to stimulate the economy. Rather, “Every hyperinflation in history has been caused by foreign debt service collapsing the exchange rate. The problem almost always has resulted from wartime foreign currency strains, not domestic spending.”

As long as workers and materials are available and the money is added in a way that reaches consumers, adding money will create the demand necessary to prompt producers to create more supply. Supply and demand will rise together and prices will remain stable. The reverse is also true. If demand (money) is not increased, supply and GDP will not go up. New demand needs to precede new supply. Infrastructure projects of the sort proposed in the Green New Deal are “self-funding,” generating resources and fees that can repay the loans. For these loans, advancing funds through a network of publicly owned banks would not require taxpayer money and could actually generate a profit for the government. That was how the original New Deal rebuilt the country in the 1930s at a time when the economy was desperately short of money.

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The title of my article yesterday very much reflects Brexit: Chaos in 2018, Mayhem in 2019.

Thousands Of British Troops On Standby For No-Deal Brexit (Ind.)

Thousands of troops have been put on standby to handle any fallout of Britain crashing out of the European Union without having secured a withdrawal deal. The government has said that, with 100 days to go until Brexit day on 29 March, it will implement all of its no-deal planning “in full” – following a clash in cabinet reflected in the wider Tory Party. Senior ministers went head-to-head, with one group demanding “no deal” become Britain’s central planning assumption, while others including the chancellor branded departing without an agreement a “unicorn” idea. Jeremy Hunt, foreign secretary, is said to have told colleagues their party would never be forgiven if it fails to deliver Brexit, but other Conservatives vowed to do everything in their power to stop a no-deal scenario.

In yet another day of Brexit high drama, defence secretary Gavin Williamson revealed he had made 3,500 troops ready to “support any government department on any contingencies they may need”. While he told MPs there had been no request for the troops yet, he said “What we are doing is putting contingency plans in place, and what we will do is have 3,500 service personnel held at readiness, including regulars and reserves, in order to support any government department on any contingencies they may need.” The Ministry of Defence later confirmed the troops would be put on alert in addition to the 5,000 already on standby to deal with potential terror attacks.

[..] Ministers have already announced plans to stockpile food and medicines, chartering ferries to bring in extra supplies and providing extra resources for border agencies. Downing Street said that advice on no-deal preparations would also be going out to households by various channels over the coming weeks. The Treasury will supply an additional £2bn on top of the £2bn already provided, with the Home Office receiving £500m for border security and handling the settlement scheme for EU nationals who want to remain in the country. Another £400m will go to Defra, the environment department, for projects including ensuring clean drinking water, which the UK treats with chemicals and gases imported from the EU.

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More British troops, just with different weapons.

“The goal was to establish “key influencers” on social media and determine who is “friendly” to the UK.”

New ‘Integrity Initiative’ Leaks: Military Ties, Infiltration of European Media (RT)

It’s been over a month since hackers began exposing the Scotland-based ‘Integrity Initiative’ as a UK government-funded propaganda outfit — and gradually new details of the organization’s clandestine activities have come to light. The documents were leaked by a group which claims to be associated with the Anonymous hackers. The first batch of leaks revealed the Integrity Initiative (II) was stealthily operating “clusters” of influencers across Europe working to ensure pro-UK narratives dominate the media. The second batch showed that the organization was also running disinformation campaigns domestically — specifically a smear campaign against Labour leader Jeremy Corbyn; all done under the guise of combatting “Russian propaganda.”

Now, a third batch of leaks has exposed that the project allegedly operated much like a modern-day version of Operation Mockingbird — a secretive 1950s project whereby the CIA worked hand-in-glove with willing journalists in major media outlets to ensure certain narratives were adhered to. Only this time, it’s a UK-funded organization with deep links to the intelligence services and military passing itself off as a non-partisan “charity.”

[..] 3. Skripal ‘monitoring campaign’ The II leapt into action after the poisoning of ex-Russian spy Sergei Skripal in March and supposedly put together a proposal to monitor social media discussion to “evaluate how the incident is being perceived” across Europe. The goal was to establish “key influencers” on social media and determine who is “friendly” to the UK. Lists of tweets on the Skripal affair were put together, along with country reports detailing how journalists in Europe were responding, the leak suggests. One report noted that in Italy, doubts about the UK narrative had been raised by “high-quality newspapers” and suggested that an “effective, discrete and articulated information campaign” must be directed at key figures in Italian politics and media.

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Neoliberalism simply failed to rise people’s living standards, so why should they support it any longer?

Either The EU Ditches Neoliberalism Or Its People Will Ditch The EU (Wight)

De Gaulle took a dim view of the UK in the postwar period, considering London a proxy of Washington. It was a view that gained common currency within French political circles after the debacle known to history as the Suez Crisis, when in 1956 the French and British entered into an ill-fated military pact with Israel to seize control of the Suez Canal from Egypt and effect the overthrow of the country’s Arab nationalist president Gamal Abdul Nasser. President Eisenhower forced the British into a humiliating retreat, threatening a series of punitive measures to leave London in no doubt of its place in the so-called special relationship. The French had been eager to continue with the Suez operation and were disgusted at London’s craven climb down in the face of Eisenhower’s intervention.

In 1958, two years after the Suez debacle, De Gaulle entered the Elysee Palace as French president. Thereafter, the humiliation of Suez still raw, he embarked on an assertion of the country’s independence from Washington that contrasted with Britain’s slavish and unedifying subservience. The French leader withdrew France from NATO’s integrated command and twice blocked Britain’s entry into the European Economic Community (EEC) – the previous incarnation of today’s EU – on the basis that London would be a US Trojan horse if admitted. There is, given this history, delicious irony in the fact that the country responsible for injecting the poison of neoliberalism into the EU – the UK under its fanatical leader Margaret Thatcher – is currently embroiled in a messy divorce from the bloc.

The EU in its current form is a latter-day prison house of nations locked inside a neoliberal straitjacket and single currency. Not only can’t it survive on this basis, but it also does not deserve to. Ultimately, either Europe’s political establishment decouples from Washington and its works – the Trump administration notwithstanding – or its peoples will decouple from them and theirs. As things stand, the latter proposition is far more likely.

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Belgian Cabinets are notorious for taking forever to form.

Belgian PM Charles Michel Resigns After No-Confidence Motion (G.)

Belgium’s government of four years has fallen on the issue of migration after the country’s parliament rejected an appeal from prime minister, Charles Michel, for its support for a minority administration. Michel was forced to offer his resignation to the King of the Belgians, Philippe, after the Socialist party, with support from the Greens, proposed a vote of no confidence in his administration. The country is now braced for a snap election in January. The head of Michel’s party said the opposition had rejected the government’s “fair offer” in order to secure a political scalp. “The Socialist opposition and Greens wanted a trophy and have it”, said David Clarinval, chairman of the liberal Reform Movement party.

[..] The N-VA, a Flemish nationalist party with hardline views on immigration, walked out of the government earlier this month over Michel’s signature to a UN migration pact providing for a common global approach to migrant flows. The draft UN accord lays down 23 objectives to open up legal migration and better manage a global flow of 250 million people, 3% of the world population. The US dropped out of talks on the pact last year and countries including Italy, Hungary, Austria, Poland, Bulgaria, Slovakia and Australia have rejected it. The deal is expected to be ratified at the UN headquarters in New York on 19 December.

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Employers can ‘ask’ employees to work 400 hrs of overtime per year without compensation.

France, Hungary, Serbia: Is Half Of Europe Protesting? (DW)

People have taken to the streets to protest against a labor law in Hungary, against tuition costs in Albania and against state violence in Serbia. Germany, meanwhile, has seen its first “yellow vest” style demonstration. Looking at the photos, one could mistake the sea of lights in Budapest for a festive holiday event. The people who gathered in Hungary’s capital Sunday night weren’t holding candles, however, but smartphones. And their message is political, not religious. They are demanding Prime Minister Viktor Orban take back a law that allows companies to ask their employees to work 400 hours overtime per year.

Since the measure was passed in parliament last Wednesday, more and more people have been protesting what has been called a “slave law.” In some cases, the rallies were overshadowed by violence. The protests on Sunday started off peaceful, but police later resorted to teargas again. With around 10,000 or even 15,000 participants, Sunday’s rally was the biggest event so far in a series of protests the likes of which Hungary hasn’t seen during Orban’s eight years in power. France is experiencing similar unrest with the “yellow vest” protests. Is the climate in Europe’s streets growing more heated?

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Of course Orban blames it all on Soros. He may come to regret ignoring his people’s anger. Same feelling as with Macron.

Hungary’s Opposition Plans More Protests After ‘Slave Law’ Passes (G.)

Hungary’s beleaguered political opposition has vowed to keep up the pressure on the country’s far-right prime minister, Viktor Orbán, after a week of protests in which thousands came on to the streets of Budapest, and four MPs were roughed up by security guards after attempting to get their demands across on state television. The protests were triggered by a so-called “slave law”, passed amid chaotic scenes in the Hungarian parliament last Wednesday, which allows employers to force employees to work overtime, and lets them delay payment for up to three years. It was passed together with legislation that provides for greater government control over the court system, the latest move by Orbán’s Fidesz party to capture independent state institutions.

A number of different opposition parties are cooperating on a joint strategy to keep pressure on the government. “We’re closely cooperating on a daily basis, and are planning roadblocks and further demonstrations if the president signs this into law,” said Tímea Szabó, of the opposition LMP party. She also said the opposition would announce civil disobedience action, though she refused to specify what it had in mind.

[..] “Brace yourselves for a new kind of democracy, one born of a carefully managed revolution by remote control,” wrote government spokesman Zoltán Kovács in a blogpost about the protests. “The revolution unfolds with protest leaders from a band of the usual suspects, many of them trained abroad and with close ties to Soros networks.” Kovács also pointed the finger at the international media, claiming they were overselling the protests, and at the “stomach-churning opportunism” of the liberal Belgian politician Guy Verhofstadt, who tweeted his support for the protests and used the hashtag #O1G, which refers to a Hungarian meme insulting Orbán in vulgar language. Kovács described Verhofstadt as “one of Soros’s henchmen in Brussels”.

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Living organisms that are 1000s of years old and span 100s a of acres.

One of Earth’s Largest Living Things Even Bigger Than Previously Thought (Ind.)

A giant honey mushroom considered a contender for the largest organism on the planet is both much larger and much older than previously thought. Scientists first studied the enormous fungus, which lives deep underground in a Michigan forest, in 1992. Then they estimated it was 1,500 years old, and the extensive mass of underground fibres and mushrooms that formed it weighed 100,000kg and stretched 15 hectares. Returning to the site, the same team used more rigorous testing to estimate the fungus was in fact closer to 2,500 years old.

They also discovered that it weighed 400,000kg and stretched over 70 hectares. This makes the enormous honey mushroom, which mostly consists of an underground network of tendrils wrapped around tree roots, heavier than three blue whales. “I view these estimates as the lower bound… The fungus could actually be much older,” said Professor James Anderson, a biologist at the University of Toronto who undertook both studies. [..] While the Michigan fungus is large, it is outclassed by another honey mushroom from Oregon that is even larger. There is also the Pando aspen in Utah, a forest originating from a single underground parent clone that is thought to weigh up to 6 million kg.


Armillaria mellea, Honey Fungus, taken in Whitewebbs Wood, Enfield, UK

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Dec 142018
 
 December 14, 2018  Posted by at 10:13 am Finance Tagged with: , , , , , , , , , , , , ,  


Paul Signac Boulevard de Clichy under snow 1886

 

ECB To Halt €2.6 Trillion Stimulus Despite Eurozone Slowdown Concerns (G.)
Shipping Costs From China To The US More Than Doubled In 2018 (CNBC)
China Reports ‘Ugly’ Industrial Output And Retail Sales Growth (CNBC)
Average UK Worker Earns A Third Less Than In 2008 (PA)
EU Leaders Scrap Plans To Help Theresa May Pass Brexit Deal (Ind.)
Labour Plans To ‘Throw Kitchen Sink’ To Force May’s Hand On Brexit (G.)
There Should Be No Exit from Brexit (Spiegel)
My Plan To Revive Europe Can Succeed Where Macron, Piketty Failed (Varoufakis)
A World That Is the Property of the 1% (Nomi Prins)
Trump Inauguration Spending Under Criminal Investigation (CNBC)
US ‘Miscarriage Of Justice’ In Butina Case Denounced (RT)
US Senate Passes Resolution Saying MbS Responsible For Khashoggi Murder (Ind.)

 

 

No. 1 victim will be Italy. ECB was the only buyer of their bonds. And bit by bit Europe will realize Draghi has been spending them into a blind alley. 2019 promises to be a crazy year in Europe.

ECB To Halt €2.6 Trillion Stimulus Despite Eurozone Slowdown Concerns (G.)

The European Central Bank will halt its €2.6tn stimulus programme in January despite concerns that the eurozone is poised to slow down over the next couple of years. Mario Draghi, the ECB boss, warned that rising uncertainty had forced the bank to downgrade its outlook for the currency bloc next year and the effects would continue to be felt in 2020. Draghi, without mentioning the US-China trade war, Brexit or the Italian government’s dispute with Brussels, said: “The balance of risk is moving to the downside.” He said growth would be limited to 1.7% in 2019, “owing to the persistence of uncertainties related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial market volatility”.

The worse-than-expected outlook sent the euro tumbling on international exchanges as investors cut back their expectations for growth across the continent. Figures showing that the German economy contracted in the last quarter were a clear signal that the eurozone had come under pressure from weakening global trade, while the slowing of the bloc’s other two major economies – France and Italy – only added to the worsening outlook. However, the ECB said the recovery was strong enough that it could stop expanding its QE programme that has seen it pump €2.6tn into the eurozone economy to stoke growth and inflation from January.

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Fear of tariffs and trade wars cause US importers to front-load their orders, causing shipping to get much busier. The US imported much more, not less after Trump’s tariffs rhetoric.

Shipping Costs From China To The US More Than Doubled In 2018 (CNBC)

The price of shipping a container from China to the United States has risen dramatically in the last year due to uncertainty surrounding trade tensions between Washington and Beijing. That’s because Chinese exporters have been rushing to get goods to U.S. ports before new tariffs kick in, but data are suggesting that trend may soon run out of steam. China and the U.S., the world’s two largest economies, have been locked in a tit-for-tat tariff fight over the last year, levying duties on each other’s imports worth hundreds of billions of dollars in the last few months. Increasingly strong fears of an all-out trade war have inspired exporters to push forward shipment dates — a phenomenon called front-loading.

In fact, freight prices for containers going from China to the U.S. have surged more than 100 percent from a year ago as of the beginning of December, according to data from Freightos, an online freight marketplace, “Transpacific ocean freight peak season has been a bonanza, with prices still more than double last year,” said a report on the most recent Freightos data published on the Baltic Exchange’s news website. That was as freight rates for China to the U.S. West Coast jumped 128 percent while those from China to the U.S. East Coast surged 123 percent compared to the same period a year ago. In contrast, China to North Europe freight rates were up just 11 percent in the same period due to pre-Christmas cargoes.

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And that is after exports to the US were frontloaded because of tariffs. What’s going to happen after January 1?

China Reports ‘Ugly’ Industrial Output And Retail Sales Growth (CNBC)

China on Friday reported industrial output and retail sales growth for the month of November that missed expectations, according to data from the National Bureau of Statistics, as the world’s second-largest economy started to show signs of slowing amid a bitter trade dispute with the U.S. Industrial output in November grew 5.4 percent from a year ago — the slowest pace in almost three years as it matched the rate of growth seen in January to February 2016, according to Reuters records. The growth in industrial production was lower than the 5.9 percent analysts in a Reuters poll had predicted.

Retail sales rose 8.1 percent in November — the weakest pace since 2003, according to Reuters’ records — lower than the 8.8 percent the analysts expected. November retail sales growth was down from 8.6 percent in October. Fixed asset investment rose 5.9 percent from January to November, marginally higher than the 5.8 percent the economists had forecast. FAI rose 5.7 percent from January to October. [..] The weaker Chinese data in November shows that the positive impact of front-loading had begun to taper off and that downward pressure on the Chinese economy was increasing, wrote Sue Trinh, head of Asia foreign exchange strategy at RBC Capital Markets in Hong Kong. The industrial output and retail sales data released on Friday were “ugly,” she added in a Friday note.

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Why Brexit, you asked?

Average UK Worker Earns A Third Less Than In 2008 (PA)

Wages are still worth a third less in some parts of the country than a decade ago, according to a report. Research by the Trades Union Congress (TUC) found that the average worker has lost £11,800 in real earnings since 2008. The UK has suffered the worst real wage slump among leading economies, said the union organisation. The biggest losses have been in areas including the London borough of Redbridge, Epsom and Waverley in Surrey, Selby in North Yorkshire and Anglesey in north Wales, the studyfound.

Workers have suffered real wage losses ranging from just under £5,000 in the north-east to more than £20,000 in London, said the report. The TUC general secretary, Frances O’Grady, said: “The government has failed to tackle Britain’s cost-of-living crisis. As a result, millions of families will be worse off this Christmas than a decade ago. “While pay packets have recovered in most leading economies, wage growth in the UK is stuck in the slow lane. “Ministers need to wake up and get wages rising faster. This means cranking up the pressure on businesses to pay staff more, especially at a time when many companies are sitting on large profits.”

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“..European leaders were left amazed when she turned up without any developed requests or ideas…”

EU Leaders Scrap Plans To Help Theresa May Pass Brexit Deal (Ind.)

Theresa May‘s Brexit plan was dealt another major blow at a meeting with EU leaders on Thursday night in a disastrous turn of events that resulted in them scrapping written commitments to help her pass her deal through parliament. After arriving in Brussels with promises to help the prime minister, European leaders were left amazed when she turned up without any developed requests or ideas. The 27 heads of state and government subsequently decided to delete lines from their council conclusions saying the EU “stands ready to examine whether any further assurance can be provided” and that “the backstop does not represent a desirable outcome for the union”.

The key paragraphs appeared in leaked earlier drafts on the conclusions and their absence leaves a barebones statement that does the bare minimum to help the prime minister. The limited assurances provided in the statement are extremely unlikely to placate Ms May’s MPs, who have said they want major changes to the agreement. Accounts of the meeting suggest the prime minister’s speech, in which she called for help to get the agreement “over the line”, was repeatedly interrupted by Angela Merkel asking her what she actually wanted from them. Senior UK government officials admitted that the prime minister did not bring any documented proposals with her to the meeting. The approach puzzled EU diplomats, who for days before the conference had said they needed to see what proposals Ms May had come up with before they could respond to her request for aid.

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Labour lacks all strength. What have they been doing in the past 2 years?

Labour Plans To ‘Throw Kitchen Sink’ To Force May’s Hand On Brexit (G.)

Jeremy Corbyn will seek to increase pressure on Theresa May in parliament next week in a bid to prevent the Tories running down the clock on Brexit. As the prime minister urged EU leaders to offer fresh concessions in Brussels on Thursday, senior Labour sources stressed the party was determined to “turn up the heat” at home. May’s spokeswoman confirmed on Thursday that “there will be no meaningful vote before Christmas”, while the prime minister negotiates with her EU counterparts. But Labour fears May will only be able to win cosmetic changes to the backstop – and that she will use the ongoing talks as an excuse to avoid testing the will of parliament.

“There must be no more dither and delay, or attempts to run down the clock in an attempt to deny parliament alternative options,” Corbyn said on Thursday. “People and businesses need certainty. The prime minister should put her deal before parliament next week in our country’s interest,” he said, adding that there was “no time to waste”. The Labour leader has held meetings with the shadow Brexit secretary, Sir Keir Starmer, who has been pressing for the party to table a motion of no confidence in the government before parliament rises for a Christmas break next Thursday. That option has not been ruled out – depending on the reaction of Conservative backbenchers and the DUP when May reports back to MPs from the European council meeting on Monday.

But the party is also studying alternative, less drastic options, including tabling an urgent question on the government’s no-deal preparations; and demanding a three-hour emergency debate to allow parliament to set out its expectations for the latest negotiations over the backstop. It could also demand a full parliamentary debate of regulations readying the financial services sector for a no-deal Brexit, which are currently due to be considered in a committee. “Essentially we can throw the parliamentary kitchen sink at them,” said another senior Labour source, “with all the trimmings”. Some shadow ministers are more sceptical about calling a no-confidence vote early, fearing it would only unite the Conservatives behind May. One told the Guardian: “We’ve got to wait until January now.”

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Germans that don’t want a way back for Britain. But that’s not their decision.

There Should Be No Exit from Brexit (Spiegel)

For two years, the British government has been negotiating the terms of its withdrawal with the European Commission, and now Prime Minister Theresa May is unable to secure a majority for that deal in parliament. The more chaotic things get in London, the more tempting it will become for the country to exit from Brexit through the emergency door the European Court of Justice unlocked on Monday when it declared that the British government could unilaterally move to revoke Article 50. A second referendum that would provide democratic legitimacy to that step seems increasingly likely. But such a move could potentially have graver consequences than an orderly Brexit — both for Britain and the EU.

There’s a good and perhaps even compelling argument for a second referendum: Now that a deal with the EU is on the table, voters would at least finally know what it is they were voting on. In the first referendum in June 2016, that wasn’t even remotely the case. But the campaign ahead of a second referendum would in all likelihood be even more xenophobic and hate-filled than the first. That could in turn produce a British society that is even more divided than it already is today, particularly given that recent polls show the pro-EU camp winning a second referendum by a narrow margin. This time, however, it is likely that the losers would be even angrier and more disappointed than the losers of the first vote.

Many would feel that their long-desired Brexit had been stolen from them and would turn away from democracy in frustration. It would provide a significant boost to anti-European right-wing populists. And this would lead to problem No. 2: Such an outcome would also be uncomfortable for the rest of the EU. The European bloc is currently desperately seeking to find common ground on important policy areas including economic and monetary union, defense and immigration. A Britain that is hopelessly divided on domestic policy could cause significant damage were it still an EU member state.

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I’m wondering how much of any Green New Deal -there are quite a few- depends on investing billions in allowing energy consumption to stay at equal levels, just with a shift from fossil to something else. How many people propose a 10-20-50% cut in overall energy consumption?

My Plan To Revive Europe Can Succeed Where Macron, Piketty Failed (Varoufakis)

[..] the latest Piketty manifesto retains a hybrid parliamentary chamber, but forfeits any Europeanist ambition – all proposals for debt pooling, risk sharing and fiscal transfers have been dropped. Instead, it suggests that national governments agree to raise €800bn (or 4% of eurozone GDP) through a harmonised corporate tax rate of 37%, an increased income tax rate for the top 1%, a new wealth tax for those with more than €1m in assets, and a C02 emissions tax of €30 per tonne. This money would then be spent within each nation-state that collected it – with next to no transfers across countries. But, if national money is to be raised and spent domestically, what is the point of another supranational parliamentary chamber?

Europe is weighed down by overgrown, quasi-insolvent banks, fiscally stressed states, irate German savers crushed by negative interest rates, and whole populations immersed in permanent depression: these are all symptoms of a decade-long financial crisis that has produced a mountain of savings sitting alongside a mountain of debts. The intention of taxing the rich and the polluters to fund innovation, migrants and the green transition is admirable. But it is insufficient to tackle Europe’s particular crisis. What Europe needs is a Green New Deal – this is what Democracy in Europe Movement 2025 – which I co-founded – and our European Spring alliance will be taking to voters in the European parliament elections next summer.

The great advantage of our Green New Deal is that we are taking a leaf out of US President Franklin Roosevelt’s original New Deal in the 1930s: our idea is to create €500bn every year in the green transition across Europe, without a euro in new taxes. Here’s how it would work: the European Investment Bank (EIB) issues bonds of that value with the ECB standing by, ready to purchase as many of them as necessary in the secondary markets. The EIB bonds will undoubtedly sell like hot cakes in a market desperate for a safe asset. Thus, the excess liquidity that keeps interest rates negative, crushing German pension funds, is soaked up and the Green New Deal is fully funded. Once hope in a Europe of shared, green prosperity is restored, it will be possible to have the necessary debate on new pan-European taxes on C02, the rich, big tech and so on – as well as settling the democratic constitution Europe deserves.

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From 2009 to 2017, the number of billionaires that own as much as the poorest 50% of world population went from 380 to 8. At that rate, pretty soon the world’s richest individual will own that much.

A World That Is the Property of the 1% (Nomi Prins)

Thanks to the massive accumulation of wealth by a 1% skilled at gaming the system, the roots of a crisis that didn’t end with the end of the Great Recession have spread across the planet, while the dividing line between the “have-nots” and the “have-a-lots” only sharpened and widened. Though the media hasn’t been paying much attention to the resulting inequality, the statistics (when you see them) on that ever-widening wealth gap are mind-boggling. According to Inequality.org, for instance, those with at least $30 million in wealth globally had the fastest growth rate of any group between 2016 and 2017. The size of that club rose by 25.5% during those years, to 174,800 members.

Or if you really want to grasp what’s been happening, consider that, between 2009 and 2017, the number of billionaires whose combined wealth was greater than that of the world’s poorest 50% fell from 380 to just eight. And by the way, despite claims by the president that every other country is screwing America, the U.S. leads the pack when it comes to the growth of inequality. As Inequality.org notes, it has “much greater shares of national wealth and income going to the richest 1% than any other country.” That, in part, is due to an institution many in the U.S. normally pay little attention to: the U.S. central bank, the Federal Reserve. It helped spark that increase in wealth disparity domestically and globally by adopting a post-crisis monetary policy in which electronically fabricated money (via a program called quantitative easing, or QE) was offered to banks and corporations at significantly cheaper rates than to ordinary Americans.

[..] In our post-2008 era, people have witnessed trillions of dollars flowing into bank bailouts and other financial subsidies, not just from governments but from the world’s major central banks. Theoretically, private banks, as a result, would have more money and pay less interest to get it. They would then lend that money to Main Street. Businesses, big and small, would tap into those funds and, in turn, produce real economic growth through expansion, hiring sprees, and wage increases. People would then have more dollars in their pockets and, feeling more financially secure, would spend that money driving the economy to new heights — and all, of course, would then be well.

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It should not be possible to have this kind of investigation into one side and not the other, simultaneously.

Trump Inauguration Spending Under Criminal Investigation (CNBC)

Manhattan-based federal prosecutors are investigating whether some of the $107 million in donations to then President-elect Donald Trump’s inaugural committee were misspent, The Wall Street Journal reported Thursday. The Journal, citing people familiar with the matter, said the investigation arose in part from the slew of materials seized in April raids on Trump’s former personal lawyer, Michael Cohen, by federal prosecutors. Cohen on Wednesday was sentenced to three years in prison on charges that came in part from those April raids on his office and residence. The criminal probe is also looking into whether some of the committee’s top spenders traded money for access to the incoming Trump administration, as well as “policy concessions or to influence official administration positions,” sources told the Journal.

“Giving money in exchange for political favors could run afoul of federal corruption laws,” the newspaper explained. “Diverting funds from the organization, which was registered as a nonprofit, could also violate federal law.” Federal prosecutors have reportedly also questioned Richard Gates — the ex-partner of onetime Trump campaign chairman Paul Manafort — who pleaded guilty in February to conspiracy and lying charges lodged by special counsel Robert Mueller. Gates, who has cooperated with investigators in Mueller’s probe of Russian interference during the 2016 U.S. election, served as deputy chairman of Trump’s inaugural committee.

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Exactly what I said about the case a few days ago. It’s become accepted in the US to coerce guilty pleas with vile threats and ugly treatment.

US ‘Miscarriage Of Justice’ In Butina Case Denounced (RT)

Maria Butina’s only crime is that she is Russian, legal analysts told RT, attacking the US justice system for keeping her in solitary confinement until she admitted guilt to at least one of the many charges brought against her. “This is an utter and total miscarriage of justice,” retired CIA agent and whistleblower John Kiriakou told RT after Butina pleaded guilty to the charge of failing to register with the Justice Department as an agent of the Russian government. “You can see clearly, this is not about justice, this is not about criminal activity. This is about making a political point. This is about identifying Russia and Russians as the enemy of the United States, and punishing them.”

“We arrested this young woman because we need dirt on Trump and Russia. And she is Russian, political and pro-Trump,” US legal analyst Jennifer Breedon explained. “We are seeing [the Foreign Agents Registration Act – FARA] being used specifically as it relates to undermining the Donald Trump administration or conservatives really with anybody involved in Russia, friends with Russia or contacts.” The Russian gun activist was subjected to “unbearable pressure” from US authorities, by being kept in solitary confinement in the Alexandria detention center outside Washington, and only allowed to take an hour-long break from her “cage” per day. John Kiriakou believes this borderline “torture” could have forced her to admit to a crime she might never even have committed.

“This woman is not an enemy combatant. So, unless news surfaces that there was some kind of skirmish or issue within the jail… it seems to go against US policy and laws as to who is forced into solitary confinement, just based solely on the charges that were lodged against her,” Breedon said. “You are kept in a steel cage 23 hours a day. And for what? Because she failed to fill out a form to send to the Justice Department?” Kiriakou pondered. “It is no wonder people in solitary confinement in the United States commit suicide every day.”

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Nothing to do with defying Trump, he wants this. Imagine he would say this, and then be held responsible for $400 oil. It’s much easier to speak as senator than as president. And many of these senators have politically supported Saudi for decades. They’re merely cleaning up their own mess.

US Senate Passes Resolution Saying MbS Responsible For Khashoggi Murder (Ind.)

The Senate has passed a resolution saying Saudi Arabian Crown Prince Mohammed bin Salman is responsible for the murder of journalist Jamal Khashoggi. Defying Donald Trump’s desire to maintain close relations with Saudi Arabia including lucrative weapons deals, Senate Foreign Relations Committee chairman Bob Corker proposed the legislation, which has been backed by at least 10 of his fellow Republicans. The CIA is reported to have assessed with “high confidence” that Crown Prince Mohammed was involved in the order to kill Mr Khashoggi, partly based on the judgement that as the country’s de facto ruler he would have had to have known. Saudi authorities have blamed a “rogue” team of operatives for the killing and have repeatedly denied any involvement by the crown prince.

Mr Trump and a number of administration officials have sought to play down the CIA assessment, with Secretary of State Mike Pompeo saying this week that it has been reported “inaccurately”. The joint resolution calls for the Saudi government to ensure “appropriate accountability” for all those responsible for Mr Khashoggi’s death, calls on Riyadh to release Saudi women’s rights activists and encourages the kingdom to increase efforts to enact economic and social reforms. However, it is unclear if the House of Representatives will consider voting on the measure.

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