May 062018
 
 May 6, 2018  Posted by at 9:46 am Finance Tagged with: , , , , , , , , , , ,  


Paul Klee In the Houses of Saint Germain 1932

 

The Rising Dollar Will Trigger Next “Systemic Banking Crisis” – Napier (ZH)
Warren Buffett Compares Bitcoin To ‘Rat Poison Squared’ (Ind.)
UK Rates Will Stay Low For A Very Long Time (G.)
Trump White House Accuses China Of ‘Orwellian Nonsense’ (G.)
US Prosecutors Allege Ex-CEO of VW Knew All About Diesel Cheating (BBC)
US Freezes Funding For Syria’s “White Helmets” (CBS)
The U.S Government Can Still Confiscate Gold (GT)
Shock Figures From Top Thinktank Reveal Extent Of NHS Crisis (G.)
Earthquakes, Lava Fissures Could Last For Months On Hawaii (R.)
CO2 Levels In Earth’s Atmosphere ‘Highest In 800,000 Years’ (Ind.)
Facing Extinction, The North Atlantic Right Whale Cannot Adapt. Can We? (G.)

 

 

Emerging markets are already hurting. Watch Turkey.

The Rising Dollar Will Trigger Next “Systemic Banking Crisis” – Napier (ZH)

Fresh off his successful call earlier this year that the US dollar would strengthen in the coming months, macroeconomic strategist and market historian Russell Napier joined MacroVoices host Erik Townsend to discuss why he favors deflation and why he has such a bullish view on the US dollar. Echoing David Tepper’s concerns that the equity highs for the year might already be in, and that a 10-year yield above 3.25% could lead to market chaos, Napier said he sees interest rates rising sharply in the coming months as the dollar strengthens – a phenomenon that will push the US back into deflation.

Napier’s thesis relies on one simple fact: With the Fed and foreign buyers pulling back, who will step into the breach and buy Treasurys? The answer is – unfortunately for anybody who borrows in dollars – nobody. In fact, the Fed is expected to allow $228 billion in Treasury debt to roll off its balance sheet this year. This “net sell” will inevitably lead to higher interest rates in the US, as well as a stronger dollar. And once the 10-year yield reaches the 4% area, signs of stress that could be a lead up to a global “credit crisis” could start to appear.

“We know what the Federal Reserve plans to sell this calendar year, $228 billion. We know what the rise in global foreign reserves is, and about 64% of that will flow into the United States’ assets. Slightly less of that will flow into Treasuries. $228 billion, at the current rate at which foreign reserves are accumulating, we are not going to see foreign central bankers offsetting the sales from the Fed. So that’s a net sell. We don’t know what that net sale will be, but it’s a net sale from central bankers at a time when the Congressional Budget Office forecasts a roughly $1 trillion fiscal deficit. This is the first time in my investment career that savers will have to fund the whole lot. And it’s perfectly normal that real rates of interest have to go higher to attract those savings.

$1 trillion is still a large amount of money. It can come from anywhere in the world. It can come from outside the United States. It can come from inside the United States. But it’s a liquidation of other assets or a rise in the savings rate, which is necessary to fund this. Either of these things is positive for the dollar.”

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“It essentially will not deliver anything other than supposed scarcity..”

Warren Buffett Compares Bitcoin To ‘Rat Poison Squared’ (Ind.)

Mega-investor Warren Buffett still is not buying into the crypto-currency craze, likening Bitcoin to “rat poison squared”. “Cryptocurrencies will come to a bad ending”, Mr Buffett told shareholders at a retreat in Omaha, Nebraska, according to the Associated Press, adding that crypto currencies have no intrinsic value. “It essentially will not deliver anything other than supposed scarcity”, added Mr Buffett, who has earned the nickname the “Oracle of Omaha” for his prescient investment decisions. The Berkshire Hathaway CEO maintained his sceptical stance even as the alternate currency’s soaring value set off a scramble last year.

In an interview with CNBC last year, he said his company did not own any cryptocurrency and was avoiding taking a position in them. “What’s going on definitely will come to a bad ending,” Mr Buffett said at the time. Other prominent economists and investors have echoed those warnings, cautioning that the frenzied speculation around crypto-currencies had the makings of a bubble. Turning to politics, Mr Buffett downplayed the risks of a trade war breaking out as a result of Donald Trump imposing tariffs on steel and aluminum, which sparked Chinese retaliation. He said it was unlikely that the two countries would “dig themselves into” a “real trade war”, suggesting the broad appeal of trade would prevent conflict.

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If the Fed raises rates, can BoE remain behind?

UK Rates Will Stay Low For A Very Long Time (G.)

Bank of England governor Mark Carney has already faced accusations of behaving like the Grand old Duke of York and he will probably do so again should Britain’s central bank opt to keep interest rates on hold. Since he joined the Bank in 2013, he has marched borrowers and savers up the hill with heavy hints about the imminent prospect of a rate rise, only to march them back down again. Last November’s restoration of 2016’s emergency rate cut hardly qualified as a major move, whatever the Bank said about its significance. Until an interview with the BBC during the IMF spring meetings a fortnight ago, it seemed to be a racing cert that the Bank was finally ready to begin the long journey back to 3% and push the base rate from 0.5% to 0.75%.

The markets were guided to expect action at a meeting of the monetary policy committee on Thursday. And it wasn’t just Carney dropping hints. Almost every member of the committee who had previously blocked a rise had gone on the record arguing that the time for a rate increase was near at hand. Speeches by external member Jan Vlieghe constituted the most startling intervention. During 2016 and much of 2017, the former hedge fund economist turned interest-rate setter was one of the most vociferous opponents of a rise. His former brethren in the Square Mile considered him an arch dove who might never vote to increase rates, such was his downbeat view of the economy’s growth potential.

Yet, towards the end of last year, he was one of the most optimistic proponents of the economy’s resilience and the likelihood of a rate rise. Just as before, a moment of central bank exuberance looks like becoming a non-event – which is strange given Vlieghe’s reasoning for backing an increase last year. Then, he said that ultra-low unemployment, steady growth and the probable end to a long period of declining real wages was enough to justify tighter monetary policy.

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Ha!

Trump White House Accuses China Of ‘Orwellian Nonsense’ (G.)

The White House on Saturday condemned Chinese efforts to control how US airlines refer to Taiwan, Hong Kong and Macao as “Orwellian nonsense”. The harshly worded statement came as a high-level trade delegation led by the Treasury secretary Steven Mnuchin returned from negotiations in China. The carriers were told to remove references on their websites or in other material that suggests Taiwan, Hong Kong and Macau are part of countries independent from China, US and airline officials said. Taiwan is China’s most sensitive territorial issue. Beijing considers the self-ruled, democratic island a wayward province. Hong Kong and Macau are former European colonies that are now part of China but run largely autonomously.

A spokesman for Airlines for America, a trade group representing United Airlines, American Airlines and other major carriers, said the group was “continuing to work with US government officials as we determine next steps”. In January, Delta Air Lines, following a demand from China over listing Taiwan and Tibet as countries on its website, apologized for making “an inadvertent error with no business or political intention” and said it had taken steps to resolve the issue. Also in January, China suspended Marriott International’s Chinese website for a week, punishing the world’s biggest hotel chain for listing Tibet, Taiwan, Hong Kong and Macau as separate countries in a customer questionnaire.

On Saturday, White House press secretary Sarah Sanders said in a statement that Donald Trump “ran against political correctness in the United States” and as president would “stand up for Americans resisting efforts by the Chinese Communist Party to impose Chinese political correctness on American companies and citizens”.

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What will Germany do?

US Prosecutors Allege Ex-CEO of VW Knew All About Diesel Cheating (BBC)

It was an “appalling” fraud that went to the very top of the company. That is the striking allegation made by US prosecutors looking into the emissions-cheating scandal at the Volkswagen Group. The indictment unsealed on Thursday claims that former CEO Martin Winterkorn was not only fully briefed about what his engineers were up to, he also authorised a continuing cover-up. These allegations have yet to be tested in a court of law. But if true, they paint a picture of extraordinary executive wrongdoing at one of the titans of German industry. Dr Winterkorn himself is unlikely ever to face trial in the US. But he remains under investigation in Germany on suspicion of deceiving investors.

The Volkswagen scandal erupted in September 2015, when the company admitted that nearly 600,000 cars sold in the US were fitted with “defeat devices” designed to circumvent emissions tests. Shortly afterwards the then head of its US operations, Michael Horn, told a congressional committee that the deception was the work of “a couple of software engineers”. We know that was far from the truth. Volkswagen has already admitted as much in an agreed “statement of facts” published last year as part of a settlement with the US Department of Justice. That document set out how Volkswagen engineers struggled to make a diesel engine which would both perform well and be capable of meeting stringent US emissions standards.

It explained how instead they designed a system to switch on emissions controls when the cars were being tested, and turn them off during normal driving. It also described how managers repeatedly sanctioned the use of this system despite objections from some employees, and encouraged engineers to hide what they were up to. The indictment against Dr Winterkorn goes considerably further – suggesting that the CEO himself was made well aware of what the engineers were doing and authorised a continued cover-up. It claims that in early 2014, engineers heard about a study commissioned by the International Council on Clean Transport, which showed that VW diesels were producing far higher emissions on the road than in official lab tests.

It says that senior managers were informed, and warned that the study might result in VW’s deception being uncovered. A memorandum was written for Dr Winterkorn explaining that the company would be unable to explain the test results to the authorities.

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No, CBS, you can’t sing the praises of these people without looking behind them.

US Freezes Funding For Syria’s “White Helmets” (CBS)

Less than two months ago the State Department hosted members of the White Helmets at Foggy Bottom. At the time, the humanitarian group was showered with praise for saving lives in Syria. “Our meetings in March were very positive. There were even remarks from senior officials about long-term commitments even into 2020. There were no suggestions whatsoever about stopping support,” Raed Saleh, the group’s leader, told CBS News. Now they are not getting any U.S funding as the State Department says the support is “under active review.” The U.S had accounted for about a third of the group’s overall funding. “This is a very worrisome development,” said an official from the White Helmets. “Ultimately, this will negatively impact the humanitarian workers ability to save lives.”

The White Helmets, formally known as the Syrian Civil Defense, are a group of 3,000 volunteer rescuers that have saved thousands of lives since the Syrian civil war began in 2011. A makeshift 911, they have run into the collapsing buildings to pull children, men and women out of danger’s way. They say they have saved more than 70,000 lives. Having not received U.S. funding in recent weeks, White Helmets are questioning what this means for the future. They have received no formal declaration from the U.S. government that the monetary assistance has come to a full halt, but the group’s people on the ground in Syria report that their funds have been cut off.

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“..gold is actually what kept the Federal Reserve solvent in 2008.”

The U.S Government Can Still Confiscate Gold (GT)

By the 1930s, the US government was facing its most severe financial crisis, and it needed gold (something of value), to stimulate the economy that was running on the fumes of fiat currency. So, it took people’s gold. It was as simple as that. Non-compliance was threatened with severe punishment. We may be facing another financial crisis, and it might be best to avoid the role of fugitive “gold hoarder.” At this point, it doesn’t make sense for the government to confiscate private gold, as a cashless society will indirectly control peoples finances. Why would the government seize gold? In 1933, under the 1913 Federal Reserve Act, the dollar had to be backed by 40 percent gold.

This would give the Federal Reserve room to print new money when needed. What’s a government to do when it needs to print money, but doesn’t have the gold reserves needed to back it up? It passes an Executive Order making gold ownership illegal but buys up the illegal gold itself. That’s what Roosevelt did. When the government continued to print more money, it declared ownership of silver illegal a year later. Soon after the government confiscated all gold, the price rose by 40 percent. As if by magic, the US government had a lot more funds than it had before. What happens is that the government buys your gold with cash, then devalues the cash and raises the value of the gold. It wins, you lose.

While the government attributes artificial value to money, it can do and does the same to the value of gold. The government currently holds 261 million ounces of gold in reserve at marked on its book at $42.22 per ounce. That’s a total value of $11 billion. Or is it? The fair market value of gold today is around $1,300 per ounce. As Jim Rickards pointed out in the New Case For Gold, gold is actually what kept the Federal Reserve solvent in 2008.

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Third world.

Shock Figures From Top Thinktank Reveal Extent Of NHS Crisis (G.)

The NHS has among the lowest per capita numbers of doctors, nurses and hospital beds in the western world, a new study of international health spending has revealed. The stark findings come from a new King’s Fund analysis of health data from 21 countries, collected by the Organisation for Economic Cooperation and Development. They reveal that only Poland has fewer doctors and nurses than the UK, while only Canada, Denmark and Sweden have fewer hospital beds, and that Britain also falls short when it comes to scanners. “If the 21 countries were a football league then the UK would be in the relegation zone in terms of the resources we put into our healthcare system, as measured by staff, equipment and beds in which to care for patients,” said Siva Anandaciva, the King’s Fund’s chief analyst.

“If you look across all these indicators – beds, staffing, scanners – the UK is consistently below the average in the resources we give the NHS relative to countries such as France and Germany. Overall, the NHS does not have the level of resources it needs to do the job we all expect it to do, given our ageing and growing population, and the OECD data confirms that,” he added. The report concludes that, given the dramatic differences between Britain and other countries: “A general picture emerges that suggests the NHS is under-resourced.”

The thinktank’s research found that the UK has the third-lowest number of doctors among the 21 nations, with just 2.8 per 1,000 people, barely half the number in Austria, which has 5.1 doctors per 1,000 of population. Similarly, the UK has the sixth-smallest number of nurses for its population: just 7.9 per 1,000 people – way behind Switzerland, which has the most: 18 nurses, more than twice as many. With hospital beds, the UK has just 2.6 for every 1,000 people, just over a third of the number in Germany, which has the most – 8.1 beds – and which places the UK 18th overall out of the 21 countries which the OECD gathered figures for. The number of hospital beds in England has halved over the last 30 years and now stands at about 100,000 ..

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How wrong can this go?

Earthquakes, Lava Fissures Could Last For Months On Hawaii (R.)

More homes on Hawaii’s Big Island were destroyed on Saturday as eruptions linked to the Kilauea volcano increased, spewing lava into residential areas and forcing nearly 2,000 people to evacuate, officials said. Scientists forecast more eruptions and more earthquakes, perhaps for months to come, after the southeast corner of the island was rocked by a 6.9 tremor on Friday, the strongest on the island since 1975. The U.S. Geological Survey (USGS) said on Saturday that several new lava fissures had opened in the Leilani Estates subdivision of Puna District, about a dozen miles (19 km) from the volcano. Not all the fissures were still active, it added.

The Hawaiian Volcano Observatory said at midday local time on Saturday that “eruptive activity is increasing and is expected to continue.” Janet Babb, a spokeswoman for the observatory, said by telephone that the eruptions could carry on “for weeks or months.” Babb said the activity since Thursday is beginning to show similarities to another event in the area in 1955 that lasted for 88 days, when far fewer people lived near the volcano.

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Rebalancing carbon: there’s too much inside the planet.

CO2 Levels In Earth’s Atmosphere ‘Highest In 800,000 Years’ (Ind.)

The concentration of carbon dioxide in the atmosphere has reached its highest level in at least 800,000 years, according to scientists. In April, CO2 concentration in the atmosphere exceeded an average of 410 parts per million (ppm) across the entire month, according to readings from the Mauna Loa Observatory in Hawaii. This is the first time in the history of the observatory’s readings that a monthly average has exceeded that level. The Scripps Institution of Oceanography said that before the Industrial Revolution, carbon dioxide levels did not exceed 300ppm in the last 800,000 years.

The Keeling Curve, which plots the concentration of carbon dioxide in the atmosphere, shows a steady rise in CO2 levels in the atmosphere for decades. Scientists have warned levels of carbon dioxide are crossing a threshold which could lead to global warming beyond the “safe” level identified by the international community, fuelling a rise in sea levels. The latest reading shows a 30 per cent increase in carbon dioxide concentration in the global atmosphere since recording began in 1958. The first measurement was recorded as 315ppm. Carbon dioxide concentration exceeded 400ppm for the first time in 2013. Prior to 1800, atmospheric CO2 averaged about 280ppm, which demonstrates the effect of manmade emissions since the industrial revolution.

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“By 1935, with as few as 60 breeding individuals left, the situation was so dire that the right whale became the first cetacean to be protected by law.”

Facing Extinction, The North Atlantic Right Whale Cannot Adapt. Can We? (G.)

As if to confound everyone, this past week Dr Charles “Stormy” Mayo and his team from the Provincetown Center for Coastal Studies reported seeing up to 150 right whales in Cape Cod Bay. Dr Mayo – who has been studying these animals for 40 years and has a scientist’s aversion to exaggeration – is stunned. “It is amazing for such a rare and utterly odd creature,” he tells me. All the more amazing since he knows this great gathering could be a final flourish. By 2040, the North Atlantic right whale may be gone. He hesitates, then uses the e-word: extinction. How can such a huge mammal simply disappear within reach of the richest and most powerful nation on earth?

Shifting food sources – due to climate change – are leading whales to areas where maritime industries are unused to them. In the past 12 months, 18 rights have died after ship strikes or entanglement in fishing gear. With as few as 430 animals left, 100 of them breeding females in a reduced gene pool, the species is unsustainable. The right whale may be the strangest beast in the ocean. Vast and rotund, its gigantic mouth is fringed with two-metre strips of baleen, once “harvested” by humans to furnish Venetian blinds and corset stays but used by the whale to strain its diet of rice-sized zooplankton from the sea.

These bizarre animals are not easily known or imagined. They live far longer than us – like its Arctic cousin, the bowhead, the right whale may reach 200, perhaps more. Individuals could be older than constitutional America. They exist beyond us in time, dimension and experience. If we lose the right whale, we lose part of our planet’s biological history. [..] By 1935, with as few as 60 breeding individuals left, the situation was so dire that the right whale became the first cetacean to be protected by law. But by the start of this century, the numbers seemed to recover. Shipping lanes were shifted and fishing industries took on board the whale’s protected status. It even got its own air exclusion zone. “Like a Hollywood star,” as John Waters quipped to me.


Eubalaena glacialis with calf

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Jan 142018
 
 January 14, 2018  Posted by at 11:00 am Finance Tagged with: , , , , , , , , , ,  


Carl Mydans Pearl Harbor 1940

 

Hawaii Panics After False Alert Of Incoming Missile (AFP)
Rising Rental Rates Suppress Consumer Demand (Roberts)
The Chinese Are Now Spending As Much As Americans (ZH)
China To Step Up Banking Oversight In ‘Arduous’ Fight On Financial Risks (R.)
EU Set To Target UK’s Overseas Tax Havens (Ind.)
Historic Brexit Vote Could Be Reversed, Admits Nigel Farage (O.)
Globalization Is Stuck In A Trap. What When It Breaks Free? (Varoufakis)
The Trump-Russia Dossier Rehab Campaign (WSJ)
Chelsea Manning Seeks US Senate Seat (AFP)
Greeks Avoid Seeing A Doctor When Ill Due To Cost (K.)

 

 

Orson Welles strikes again.

Hawaii Panics After False Alert Of Incoming Missile (AFP)

An alert warning of an incoming ballistic missile aimed at Hawaii was sent in error Saturday, sowing panic and confusion across the US state – which is already on edge over the risk of attack – before officials dubbed it a “false alarm.” Emergency management officials eventually determined the notification was sent just after 8:00 am during a shift change and a drill after “the wrong button was pushed” – a mistake that lit up phones across the archipelago with a disturbing alert urging people to “seek immediate shelter.” There were frenzied scenes of people rushing to safety – a bathtub, a basement, a manhole, cowering under mattresses. Adventurer Alison Teal called it “the worst moment of my life.”

The erroneous message came after months of soaring tensions between Washington and Pyongyang, with North Korea saying it has successfully tested ballistic missiles that could deliver atomic warheads to the United States, including the chain of volcanic islands. “I deeply apologize for the trouble and heartbreak that we caused today,” said Vern Miyagi, administrator of Hawaii’s Emergency Management Agency. “We’ve spent the last few months trying to get ahead of this whole threat, so that we could provide as much notification and preparation to the public. “We made a mistake,” he acknowledged in a press conference. “We’re going to take processes and study this so that this doesn’t happen again. “The governor has directed that we hold off any more tests until we get this squared away.”

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And lead to recessions. Still lots of people out there saying price increases equal inflation. They don’t.

Rising Rental Rates Suppress Consumer Demand (Roberts)

[..] the cost of Housing, Medical Care, and Transportation have all risen sharply over the past 5-months with those three components comprising 67% of the inflation calculation. Clearly, the surge in “health care” related costs, due to the surging premiums of insurance due to the “Un-affordable Care Act,” pushed both consumer-related spending measures and inflationary pressures higher. Unfortunately, higher health care premiums do not provide a boost to production but drain consumptive spending capabilities. Housing costs, a very large portion of overall CPI, is also boosting inflationary pressures. But like “health care” costs, rising housing costs and rental rates also suppress consumptive spending ability.

Importantly, while households may be receiving a modest “tax cut” over the coming year, given the rise in three of the biggest expenditures in most households, whatever increase in incomes maybe received has likely already been absorbed by higher costs and debt service payments. “For the middle-class and working poor, which is roughly 80% of households, rent, energy, medical and food comprise 80-90% of the aggregate consumption basket.” – Research Affiliates. The problem for the Fed is that by pushing interest rates higher, under the belief there is a broad increase in inflation, the suppression of demand will only be exacerbated as the costs of variable rate interest payments also rise. With households already ramping up debt just to make ends meet, another increased expense will only serve to further suppress “consumer demand.”

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Brought to you as a success story.

The Chinese Are Now Spending As Much As Americans (ZH)

In the US, the latest batch of data, released this week, showed retail sales climbed in December for the sixth straight month – though they missed expectations, with growth slowing to 0.3% MoM. With the personal savings rate at a 10 year low, the US consumer is now fully tapped out: This latest uptick in spending has presumably been fueled by debt, as credit-card borrowing has reached an all-time high. But another milestone in the history of global consumerism passed last month: As the Washington Post points out, China tied the US in 2018 in terms of domestic retail sales – according to data compiled by Mizuho. In some important categories, China has overtaken the US: With 17.6 million vehicles sold in the US in 2016, for example, but that was far below the 24 million passenger cars sold in China.

US automakers account for about one out of every five cars sold in China, even though the communist party placed a 10% tax on luxury cars and trucks imported from the United States. This economic heft has made the problem of confronting China intractable: China is now responsible for 20% of sales for some of the largest US corporations. This is making it difficult for Trump to confront Xi Jinping. Any restrictions on Chinese access to the US market would be met with barriers to American companies selling in China. One area where there’s a lot of agreement across the political spectrum is to go after China’s theft of US intellectual property. Over the summer, Trump ordered an investigation by the US Trade Representative Robert Lighthizer to examine China’s IP policies.

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Xi’s knee jerk is to increase central control. But the bubble couldn’t have happened without the shadow system, i.e. decentralization.

China To Step Up Banking Oversight In ‘Arduous’ Fight On Financial Risks (R.)

China will step up oversight in the banking sector this year to reduce financial risks, the country’s banking regulator said, stressing that long-term efforts would be needed to control banking sector chaos. The China Banking Regulatory Commission (CBRC) said late on Saturday in a statement that its priorities included increasing supervision over shadow banking and interbank activities. “Banking shareholder management, corporate governance and risk control mechanisms are still relatively weak, and root causes creating market chaos have not fundamentally changed,” the CBRC said. “Bringing the banking sector under control will be long-term, arduous, and complex,” it said. The regulator said violations in corporate governance, property loans, and disposal of non-performing assets will be punished more strictly, and that it would strengthen risk control in interbank activities, financial products and off-balance sheet business.

China has repeatedly vowed to clean up disorder in its banking system. In recent months, regulators have introduced a series of new measures aimed at controlling risk and leverage in the financial system, with everything from lending practices to shadow banking under the microscope. Already in January, the CBRC has published regulations that put limits on the number of commercial banks that single investors can have major holdings in. President Xi Jinping has declared that financial security is vital to national security. The government is particularly concerned about the massive shadow banking industry, lending conducted outside of the regulated formal banking system. It fears that a big default or series of loan losses could cascade through the world’s second-biggest economy, leading to a sudden halt in bank lending.

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And not its own.

EU Set To Target UK’s Overseas Tax Havens (Ind.)

Demands to open up Britain’s shady network of overseas tax havens are set to be used by the EU as leverage to force concessions during Brexit trade talks, The Independent understands. The European Commission will soon review whether British territories previously left off a Brussels tax haven blacklist should now be added – just as negotiations move on to the all-important future trade deal. Publicly EU officials say the blacklisting process has nothing to do with Brexit, but separate sources in Brussels told The Independent British territories where billions of pounds are stashed will come into play. One official made clear the EU would “go after” them, while another said the UK Government must ask itself if it wants to fly in the face of British public opinion on tax avoidance.

EU commissioners in December produced a blacklist of uncooperative tax jurisdictions, in a bid to clamp down on evasion and avoidance, tackle “threats” to members states’ tax bases and take on “third countries that consistently refuse to play fair”. But the 17 jurisdictions listed included no British Overseas Territories or Crown Dependencies, despite them being named in earlier EU lists and some being implicated in the Paradise Papers scandal. The EU had agreed the blacklisting screening process would be put on hold for territories caught in Hurricane Irma, meanwhile the UK is said to have pushed back against tougher sanctions for blacklisted territories. But officials confirmed that the screening process will now restart in “early spring” for British territories including Anguilla, the British Virgin Islands and the Turks and Caicos Islands. Other British territories – Bermuda, the Cayman Islands, Guernsey, the Isle of Man and Jersey – promised to try and address EU concerns to stay off the list, which will now be reviewed annually.

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Covering his tracks?

Historic Brexit Vote Could Be Reversed, Admits Nigel Farage (O.)

Nigel Farage today makes a dramatic admission that the vote for Brexit could be overturned because Remainers have seized control of the argument over Britain’s future relationship with the EU. The former Ukip leader told the Observer that he was becoming increasingly worried that the Leave camp had stopped fighting their corner, leaving a well-funded and organised Remain operation free to influence the political and public debate without challenge. “The Remain side are making all the running,” said Farage. “They have a majority in parliament, and unless we get ourselves organised we could lose the historic victory that was Brexit.” On Thursday Farage angered many Brexiters, and many in Ukip, when he said he was coming round to the view that the country might need to hold a second referendum in order to close down the EU argument for good.

He said then that he believed such a vote would see the Brexit side win with a bigger majority than the one it achieved on 23 June 2016, when it triumphed by 52% to 48%. But, speaking on Friday, Farage appeared to change his tune, making clear that he was seriously worried that Brexit could be undone and reversed. The case for a complete break from the EU was no longer being made, even by pro-Brexit MPs in parliament, he said. Instead, the Remain camp was relentlessly putting out its message that a hard Brexit would be ruinous to the British economy and bad for the country, without people hearing the counter-argument that had secured Brexiters victory in the 2016 referendum campaign.

His latest intervention comes ahead of another vital week for the Brexit process in the House of Commons and as peers in the overwhelmingly pro-Remain House of Lords prepare to argue for retaining the closest possible links with the EU – and in some cases for a second referendum – when legislation reaches peers at the end of this month. Farage said he now had a similar feeling to the one he had 20 years ago when Tony Blair appeared to be preparing the country for an eventual entry into the euro. “I think the Leave side is in danger of not even making the argument,” he said. “The Leave groups need to regather and regroup, because Remain is making all the arguments. After we won the referendum, we closed the doors and stopped making the argument.”

Last Monday Farage held a meeting in Brussels with the EU’s chief Brexit negotiator, Michel Barnier, which, he said, left him convinced that the UK would not be offered the kind of deal that would be easy to sell as beneficial to the UK economy unless Leavers upped their game. “We no longer have a majority in parliament. I think we would lose the vote in parliament,” Farage said.

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Decentralize.

Globalization Is Stuck In A Trap. What When It Breaks Free? (Varoufakis)

Humanity has been globalizing since our ancestors left Africa, the earliest economic migrants on record. Moreover, capitalism has been operating for two centuries like “heavy artillery,” in Marx and Engels’ words, using the “cheap prices of commodities” to batter “down all Chinese walls,” “constantly expanding market for its products” and replacing “the old local and national seclusion and self-sufficiency” with “intercourse in every direction, universal interdependence of nations.” It wasn’t until the 1990s, when we noticed the unleashing of momentous forces, that we required a new term to describe the emancipation of capital from all fetters, which led to a global economy whose growth and equilibrium relied on increasingly unbalanced trade and money movements. It is this relatively recent phenomenon – globalization, we called it – that is now in crisis and in retreat.

Only an ambitious new internationalism can help reinvigorate the spirit of humanism on a planetary scale. But before arguing in favour of that antidote, it is worthwhile recounting globalization’s origins and internal contradictions. In 1944, the New Deal administration in Washington understood that the only way to avoid the Great Depression’s return at war’s end was to transfer America’s surpluses to Europe (the Marshall Plan was but one example of this) and Japan, effectively recycling them to generate foreign demand for all the gleaming new products – washing machines, cars, television sets, passenger jets – that American industry would switch to from military hardware. Thus began the project of dollarizing Europe, founding the EU as a cartel of heavy industry, and building up Japan within the context of a global currency union based on the U.S. dollar.

This would equilibrate a global system featuring fixed exchange rates, almost-constant interest rates and boring banks (operating under severe capital controls). This dazzling design, also known as the Bretton Woods system, brought us a golden age of low unemployment and inflation, high growth and impressively diminished inequality. Alas, by the late 1960s, it was dead in the water. Why? Because the United States lost its surpluses and slipped into a burgeoning twin deficit (trade and federal budget), rendering it no longer able to stabilize the global system. Never too slow to confront reality, Washington killed off its finest creation: On Aug. 15, 1971, then-president Richard Nixon announced the ejection of Europe and Japan from the dollar zone. Unnoticed by almost everyone, globalization was born on that summer day.

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The Wal Street Journal doesn’t mince its words.

The Trump-Russia Dossier Rehab Campaign (WSJ)

There’s no such thing as a coincidence in Washington, so why the sudden, furious effort by Democrats and the media to give cover to the Steele dossier? As in, the sudden, furious effort that happens to coincide with congressional investigators’ finally being given access to FBI records about the Trump-Russia probe. This scandal’s pivotal day was Jan. 3. That’s the deadline House Intelligence Chairman Devin Nunes gave the Federal Bureau of Investigation to turn over documents it had been holding for months. Speaker Paul Ryan backed Mr. Nunes’s threat to cite officials for contempt of Congress. Everyone who played a part in encouraging the FBI’s colonoscopy of the Trump campaign – congressional Democrats, FBI and Justice Department senior career staff, the Hillary Clinton and Barack Obama political mobs, dossier commissioner Fusion GPS, the press corps – knew about the deadline and clearly had been tipped to the likelihood that the FBI would have to comply.

Thus the dossier rehabilitation campaign. Weeks before, the same crew had taken a desperate shot at running away from the dossier, with a New York Times special that attempted to play down its significance in the FBI probe. You can see why. In the year since BuzzFeed published the salacious dossier, we’ve discovered it was a work product of the Clinton campaign, commissioned by an oppo-research firm (Fusion), compiled by a British ex-spook on the basis of anonymous sources, and rolled out to the media in the runup to the election. Oh, and it appears to continue to be almost entirely false. When the best you’ve got is that a campaign orbiter made a public trip to Russia, you haven’t got much. But with Congress about to obtain documents that show the dossier did matter, it was time for a new line.

And so the day before the Nunes deadline, Fusion co-founders Glenn Simpson and Peter Fritsch broke their public silence to explain in a New York Times op-ed that what really matters was their noble intention – to highlight Donald Trump’s misdeeds. The duo took credit for alerting the “national security community” to a Russian “attack.” Meanwhile, Dianne Feinstein, ranking Democrat on the Senate Judiciary Committee, decided it was suddenly a matter of urgency that the nation see Mr. Simpson’s testimony, which he gave back in August. That move provided the cable news channels with more than 300 pages of self-serving material. Mr. Simpson extols his journalistic chops, praises the integrity of dossier author Christopher Steele (a “Boy Scout”), professes his love of country and his distaste for Russians (other than those paying him), and ladles on more disinformation about Mr. Trump.

Democrats and the media have spun this into a new contention: What mattered were the motives and credentials of the dossier’s creators, which were sufficient to give the FBI good cause to run with the document. Which you have to admit sounds a lot better than “Hillary Clinton’s Campaign Conjured Up an Opposition-Research Document That Was Fed to the Obama FBI, Which Then Used It to Spy on the Trump Campaign.” Even if that’s a more accurate headline.

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Very smart, brave and strong.

Chelsea Manning Seeks US Senate Seat (AFP)

Whistleblower Chelsea Manning, jailed for leaking classified information, is seeking election in the US state of Maryland, a document seen on Saturday says. The Federal Election Commission document, filed Thursday, lists Chelsea Elizabeth Manning of North Bethesda, Maryland, as a Democratic candidate for the United States senate. Manning, now 30, was an army intelligence analyst sentenced to 35 years in prison in 2013 for leaking more than 700,000 classified documents related to the wars in Iraq and Afghanistan. The revelations by Manning, who is transgender and was then known as Bradley Manning, exposed covered-up misdeeds and possible crimes by US troops and allies.

Her actions made Manning a hero to anti-war and anti-secrecy activists but US establishment figures branded her a traitor. Then-president Barack Obama commuted Manning’s sentence, leading to her release in May. During her incarceration, Manning battled for, and won, the right to start hormone treatment. On Twitter, she identifies herself as a “trans woman,” and carries the slogan: “Make powerful people angry.”

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A great health care sytem has fallen victim to Brussels. Unforgiveable.

Greeks Avoid Seeing A Doctor When Ill Due To Cost (K.)

30% of people who fell ill in Greece in 2016 did not see a doctor, according to a new survey which found that 35.8% of those people who did not seek treatment did so due to the financial cost. The nationwide survey, based on a sample of 2,000 adults, was carried out in January 2017 by the National School of Public Health in Athens. The results, which highlight the impact of the financial crisis on access to medical care, were made available only recently. The study showed that the main reason Greeks consulted a health professional in 2016 was because they were experiencing a symptom or pain, with 47.4% giving that as a reason. In 2006 only 21% gave that as a main reason as most people visited doctors to receive medical prescriptions or routine checkups. Meanwhile, 26.4% of Greeks who needed healthcare in 2016 received it for free, compared to 52.6% in 2006.

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