Mar 092019
 


Juan Gris Portrait of Pablo Picasso 1912

 

World’s Biggest Debt Slaves: Americans Wimp Out in 11th Place (WS)
Chelsea Manning Jailed For Refusing To Testify About Wikileaks (ZH)
On Trump’s Ties To Russia, Americans Have Made Up Their Minds – Poll (R.)
Trump’s Private Talks With Putin May Contain Clues To His Russia Romance (G.)
Ilhan Omar Criticizes Obama And Past Presidents’ ‘Really Bad Policies’ (MW)
EU’s Barnier Sets May On Course For Brexit Defeat (G.)
Corbyn Tells May Second Defeat For Her Deal Is ‘The End Of The Road’ (Ind.)
Greenpeace Co-Founder Thrashes Global Warming ‘Brainwashing’ Campaign (RT)
Italy’s Government On Verge Of Collapse Over A Train (ZH)
Dutch Pharmacies Join Backlash At Expensive Drugs By Making Their Own (R.)
A Place of Your Own (Jim Kunstler)

 

 

Wolf Richter has the entire top-11. I picked a few. Note: this is debt-to-GDP. For debt-to-disposable income, graphs are different. Note 2: Switzerland is always an odd one out because of the role of its banking system.

World’s Biggest Debt Slaves: Americans Wimp Out in 11th Place (WS)

US household debt inched down to 76.4% of GDP in the third quarter 2018, according to the newest batch of global data from the Bank for International Settlements. This was the lowest level since 2002. It put Americans in the inexplicably wimpy, and for the finance sector, insufferable 11th place:

Canadian households have long been making headlines with their top-notch borrowing binge to support their top-notch housing bubble. By other debt measures, such as debt-to-disposable income, Canadian and Australian households have been battling over first place for years. In the debt-to-GDP measure, Canadian households are in a still respectable 6th place: This debt will pose some issues as the majestic housing bubbles in top metros are now deflating:

Households in the Netherlands were track to be undisputed king of the hill, with a debt-to-GDP ratio nearing 120%, in part because GDP plunged during the Financial Crisis, which caused the spike in the debt-to-GDP ratio and the collapse of some banks. During the subsequent euro debt crisis, GDP declined again. But since then, the economy has grown, and households have curtailed their borrowing, edging away from the brink, and in the process getting demoted to 4th place:

Australian households have been caught up in one of the biggest housing bubbles in the world, financed by debt. The household-debt-to-GDP ratio more than doubled between 1997 and 2016. Now that the housing bubble is deflating at an astounding pace, the debt ratio has begun to tick down, but remains in second place:

[..] the #1 debt slaves in the world: Swiss households. This is one of the reasons interest-rate repression remains the rule in Switzerland. The Swiss National Bank has imposed its negative interest rate policy on the country for years, and there have been stories of mortgages with 0% and even negative interest rates. There is simply too much household debt, and no one wants to see it blow up. Hence the negative interest rate policy. But this policy encourages more household borrowing, and the cycle will continue until it can’t:

China is in a category of its own. And so the chart has a different scale. The household-debt-to-GDP ratio is still in the German neighborhood of just above 50%, but it has quintupled in the 12 years since the BIS data began in 2006. The idea that Chinese households are paying cash to sustain their housing bubble or to buy cars has become a bad joke: Chinese consumers have discovered debt, and they are eagerly turning into debt slaves:

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Daniel Ellsberg: “Chelsea Manning is again acting heroically in the name of press freedom, and it’s a travesty that she has been sent back to jail for refusing to testify to a grand jury. An investigation into WikiLeaks for publishing is a grave threat to all journalists’ rights, and Chelsea is doing us all a service for fighting it. She has already been tortured, spent years in jail, and has suffered more than enough. She should be released immediately.”

Chelsea Manning Jailed For Refusing To Testify About Wikileaks (ZH)

Following a dramatic hearing at a federal district court in Eastern Virginia, activist and former military prisoner Chelsea Manning was jailed by a judge for contempt of court after refusing to testify to a grand jury empaneled in the government’s long running criminal investigation into Wikileaks and its founder, Julian Assange. The judge, the Hon. Claude H. Hilton, ruled that Manning must remain in civil detention until she testifies, her lawyer Moira Meltzer-Cohen told the New York Times. Manning was subpoeaned in January to testify before the jury. But she vowed not to cooperate even though prosecutors offered immunity for her testimony. “In solidarity with many activists facing the odds, I will stand by my principles,” she said on Thursday. “I will exhaust every legal remedy available. My legal team continues to challenge the secrecy of these proceedings, and I am prepared to face the consequences of my refusal.”

Manning’s jailing offers another glimpse into the government’s secretive investigation into Wikileaks, which was started under the Obama Administration and picked up by the Trump Administration. Manning served seven years in prison for leaking the infamous “collateral murder” tape to Wikileaks, by far the longest prison term ever served for leaking government secrets. Manning, who transitioned to a woman during her time in prison, twice tried to commit suicide before she was pardoned by Obama. Late last year, an accidental leak of some information in the case revealed that Assange had been charged under seal last summer. And while Manning has decided to refuse to cooperate, a Wikileaks volunteer recently agreed to testify against Assange in exchange for immunity. The grand jury has been investigating Assange for nine years.

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This is the worst condemnation of US media to date. And I betcha, no-one sees it that way. Whatever Mueller says, minds are made up. By what then? Can only be unproven accusations.

And it has similarities with the Chelsea Manning disaster: When will the first Republican refuse to testify before Nadler’s committee? In both cases people are looking to confirm pre-established narratives, if need be by force.

On Trump’s Ties To Russia, Americans Have Made Up Their Minds – Poll (R.)

Only a small number of Americans have not yet made up their minds about whether Donald Trump’s 2016 election campaign coordinated with Russian officials, according to new Reuters/Ipsos polling, which also showed deep divisions in the United States in the run-up to the 2020 presidential election. Eight out of 10 Americans decided almost immediately about Trump campaign ties to Moscow and only about two in 10 appear to be undecided, the opinion poll released on Friday showed. About half of Americans believe President Trump tried to stop federal investigations into his campaign, the survey found. Special Counsel Robert Mueller is expected to soon wrap up his investigation into U.S. allegations that Moscow interfered in the U.S. political process as well as the Trump campaign links and possible obstruction of justice.

Moscow and Trump deny the allegations. Barring bombshell revelations, the survey results suggest the investigation’s influence on voters in the 2020 campaign may already have run its course. The Reuters/Ipsos poll has tracked public opinion of the investigation since Mueller was appointed in May 2017 following Trump’s firing of FBI chief James Comey, gathering responses from more than 72,000 adults. Public opinion appears to have hardened early, changing little over the past two years despite a string of highly publicized criminal charges against people associated with the Trump campaign. Every time respondents were asked about the investigation, about 8 in 10 Democrats said they thought the Trump campaign colluded with Russia, while 7 in 10 Republicans said they did not.

With so few voters left undecided, the report expected from Mueller looks unlikely to serve as a significant voter turnout tool for Republicans or Democrats in November 2020 and could backfire on Democrats if they overplay it. “We keep waiting for something to happen during the Trump era to vastly change the way people view him,” said Kyle Kondik, a non-partisan analyst at the University of Virginia Center for Politics. “It hasn’t happened yet,” he said. “Maybe at this point there just aren’t many minds left to change.”

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The media can’t let go of Russiagate, no matter what Mueller says, it would leave them empty handed. So they play into the fact that Americans have their minds made up anyway. Scary when you think about it.

Trump’s Private Talks With Putin May Contain Clues To His Russia Romance (G.)

Since Donald Trump was sworn in as president he has met his Russian counterpart, Vladimir Putin, five times. The details of their conversations remain unknown to the public, and in most cases even to senior administration officials. Democrats in Congress are now demanding more details of communications between the two leaders. Secrecy around such meetings, they say, raises fresh questions about the nature of Trump’s relationship with Putin at a time when his ties to Russia are the subject of several investigations. The meetings with Putin are not the only subject of such Democratic demands. House leaders left little room for doubt this week that they will utilize their newly minted majority to cast a wide net around the president, his family and their businesses.

The judiciary committee issued document requests to 81 individuals and entities, seeking information on everything from contacts between Trump aides and Moscow to hush money payments to women and possible obstruction of justice. [..] Democrats now say Trump’s reportedly forceful attempts to conceal his communications with Putin raise questions about his motivations in pursuing closer relations with a regime largely regarded as a primary adversary. In a joint letter this week, the chairs of the House intelligence, foreign affairs and oversight committees raised “profound national security, counterintelligence and foreign policy concerns, especially in light of Russia’s ongoing active measures campaign to improperly influence American elections.

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Discussions America should have but refuses. The Dem old guard wants things to stay as they were/are. But the party must change in radical ways.

Ilhan Omar Criticizes Obama And Past Presidents’ ‘Really Bad Policies’ (MW)

Rep. Ilhan Omar (D-Minn.) says former President Barack Obama’s promise of “hope and change” was just a mirage in a Politico interview that hit on Friday. The magazine profile explains that when she ran for office in 2016, she was fed up with the Democratic Party — not so much Trumpism or politics in general. Omar also reminded the interviewer that there was “caging of kids” at the U.S.-Mexico border under the Obama administration. (Obama was called the “deporter-in-chief” by immigrant rights advocates for the record number of undocumented immigrants deported during his presidency; ICE deportations peaked at 409,849 in 2012. But it dropped to almost half of that by 2017.) mAnd she called out the “droning of countries around the world” under Obama. A 2015 report claimed that nearly 90% of people killed in recent drone strikes in the Middle East “were not the intended targets.”

The interview dropped the day after the House passed a resolution condemning bigotry that included anti-Semitism and anti-Muslim discrimination, which was a response to comments made by Omar, who accused people of having allegiances to foreign countries. (It did not mention Omar by name, however.) Her comments to Politico suggest she doesn’t mind being at the center of controversy. “As much as other people are uncomfortable, I’m excited about the change in tone that has taken place that is extremely positive … and my ability, I think, to agitate our foreign policy discussions in a way that many of my colleagues who have been anti-intervention, antiwar have been unable to do in the past,” she said. “So, I’m OK with taking the blows if it means it will ignite conversations that no one was willing to have before.”

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Is the Guardian finally standing up for May? Bit late, isn’t it?

EU’s Barnier Sets May On Course For Brexit Defeat (G.)

Theresa May appears set for a second humiliating defeat when she brings her Brexit deal back to parliament next week, after the EU’s chief negotiator, Michel Barnier, rebuffed her pleas for last-minute concessions. The prime minister urged MPs to “get it done” and back her deal, in an impassioned speech at a dockside warehouse in the leave-voting town of Grimsby. A vote against the deal would mean “not completing Brexit and getting on with all the other important issues people care about, just yet more months and years arguing”, May told MPs. “If we go down that road we might never leave the EU at all.”

Addressing workers from Ørsted, a Danish energy and wind turbine firm, May also urged the EU to make new concessions over the Irish backstop – the issue that caused many of her MPs to vote against the deal the first time – before last-ditch talks in Brussels this weekend. The EU “has to make a choice too”, the prime minister said. “We are both participants in this process. It is in the European interest for the UK to leave with a deal. We are working with them but the decisions that the European Union makes over the next few days will have a big impact on the outcome of the vote. “European leaders tell me they worry that time is running out and that we only have one chance to get it right. My message to them is: now is the moment for us to act.”

But Barnier immediately appeared to rebuff the prime minister, by responding with an offer of reverting to his original plan, the Northern Ireland-only backstop, which May repeatedly said no prime minister could accept, because it risked creating a border in the Irish Sea. The EU’s chief negotiator said in a series of tweets that the EU was committed “to give the UK the option to exit the single customs territory unilaterally, while the other elements of the backstop must be maintained to avoid a hard border. [The] UK will not be forced into a customs union against its will.” The Brexit secretary, Stephen Barclay, immediately replied: “With a very real deadline looming, now is not the time to rerun old arguments. The UK has put forward clear new proposals. We now need to agree a balanced solution that can work for both sides.”

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If a tree falls in a forest….

Corbyn Tells May Second Defeat For Her Deal Is ‘The End Of The Road’ (Ind.)

Jeremy Corbyn has warned Theresa May not to make a third attempt to ram through her Brexit deal if it crashes to its expected defeat next week, saying it must be “the end of the road”. The prime minister has not ruled out a third “meaningful vote” if MPs reject her agreement next week – even with the scheduled exit day from the EU just three weeks away. But, speaking to Labour activists in Scotland, Mr Corbyn said Ms May must accept that defeat on Tuesday would “represent an unprecedented failure in British political history”. “Having already failed once to get her deal through, I want to make it clear to the prime minister if she fails again it will be the end of the road for her deal,” the Labour leader said.

“There is no coming back from it. There can be no more playing for time.” Mr Corbyn again insisted Labour’s softer Brexit proposals could secure agreement both at Westminster and in Brussels, following his “discussions with Michel Barnier” [the EU negotiator]. However, he also insisted Labour was not “obsessed” by Brexit like other parties – pointing to poverty and climate change as the issues that really matter. “Turn on the news at the moment and you’ll hear endlessly about constitutional issues. Brexit. Independence. It borders on the obsessive,” he told a conference in Dundee. “You don’t hear so much about the children arriving hungry to school or how the teachers at one nursery have had to arrange for Tesco and Greggs to donate their leftovers so they can feed the kids.”

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I think Moore has at least a partial burden of proof here. Just shouting out stuff isn’t good enough at this stage. Suggesting that research is good only if it’s paid by General Electric or Dupont or 3M is quite the stretch. Even if politics and business are indeed eyeing huge profits off of going green and off people’s ignorance about what that means.

Greenpeace Co-Founder Thrashes Global Warming ‘Brainwashing’ Campaign (RT)

Greenpeace co-founder Patrick Moore had harsh words for the modern environmental movement, calling global warming “the greatest scam in history” and denouncing the use of “fear and guilt” to push the message. “The climate catastrophe is strictly a fear campaign – well, fear and guilt,” Moore told Breitbart radio host Rebecca Mansour. “You’re afraid you’re killing your children because you’re driving them in your SUV and emitting carbon dioxide into the atmosphere and you feel guilty for doing that. There’s no stronger motivation than those two.” “This abomination that is occurring today in the climate issue is the biggest threat to the enlightenment that has occurred since Galileo.”

“Nothing else comes close,” Moore insisted, likening the contemporary environmental movement to “a toxic mix of ideology, of politics and religion.” “CO2 is the food for life! It’s not pollution,” the would-be heretic declared, claiming that the use of fossil fuels had actually “saved life from an early demise” because CO2 had been declining since the last ice age, with barely enough for the earth’s plant life to sustain itself, until humanity stepped into the breach during the Industrial Revolution. Moore, who founded the pioneering environmental activist group almost 50 years ago to protest nuclear war, met with an outpouring of support from conservatives and weary Democrats alike, after tweeting a scathing rebuke earlier this week to Alexandria Ocasio-Cortez, whose quixotic Green New Deal has become the standard-bearer of the 21st century environmental movement.

“And so you’ve got the green movement creating stories that instill fear in the public. You’ve got the media echo chamber — fake news — repeating it over and over and over again to everybody that they’re killing their children, and then you’ve got the green politicians who are buying scientists with government money to produce fear for them in the form of scientific-looking materials, and then you’ve got the green businesses, the rent-seekers and the crony capitalists who are taking advantage of massive subsidies, huge tax write-offs, and government mandates requiring their technologies to make a fortune on this, and then of course you’ve got the scientists who are willingly, they’re basically hooked on government grants.

When they talk about the 99 percent consensus [among scientists] on climate change, that’s a completely ridiculous and false numbers, but most of the scientists — put it in quotes, scientists — who are pushing this catastrophic theory are getting paid by public money. They are not being paid by General Electric or Dupont or 3M to do this research, where private companies expect to get something useful from their research that might produce a better product and make them a profit in the end because people want it — build a better mousetrap type of idea — but most of what these so-called scientists are doing is simply producing more fear so that politicians can use it control people’s mind and get their votes because some of the people are convinced, ‘Oh, this politician can save my kid from certain doom.’

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The collapse may happen soon, but likely not because of an old topic like this.

Italy’s Government On Verge Of Collapse Over A Train (ZH)

With the Italian government seemingly on the verge of collapse every few months, and with tensions between the two parties in the ruling coalition – Five Star and the League, especially as the former has been sliding in the polls at the expense of the latter’s rising popularity – escalating in recent weeks, it was only a matter of time before Italian bondholders had a PTSD flashback to May 2018 when the populist government first stormed on the stage, sending Italian bonds plunging. All that was missing was a catalyst. Said catalyst emerged as a lingering dispute within Italy’s ruling coalition over the future of a train, or technically a high-speed rail link with France, escalated suddenly on Thursday, once again raising the risk of a government collapse, with the 5-Star chief accusing his partner of acting irresponsibly.

The Alpine rail line has been backed by the ruling League party but is fiercely opposed by its coalition partner, the 5-Star Movement, which argues Italy’s share of the funding would be better spent upgrading existing roads and bridges. And after League leader, the outspoken Matteo Salvini who continues to enjoy rising popularity with every new poll, said in an evening television interview he would not back down and his party would “never sign” a decree to block the project, 5-Star chief Luigi Di Maio accused him of threatening to bring down the government.

While the tensions between Di Maio and Salvini were for the most part contained before closed doors, the animosity between the two “equal” vice premiers erupted in public when Di Maio said in a statement that Salvini “will bear the responsibility before millions of Italians” adding that he considers “this to be irresponsible behavior” adding that he was “stunned by the threat of a government crisis” coming from Salvini. The TAV project (Treno Alta Velocita) is a joint venture between the Italian and French states to link the cities of Turin and Lyon with a 58-km (36-mile) tunnel through the Alps on which work has already begun. According to Reuters, the EU has pledged to fund up to 40 percent of costs, Italy up to 35 percent and France up to 25 percent.

Earlier on Thursday, Italy’s Prime Minister Giuseppe Conte said that recently updated traffic projections for the line warranted a review of the project’s long-term viability and, if necessary, a renegotiation of the way the funding is split. Conte told reporters he had strong personal doubts about the validity of the venture and he would take responsibility for a final decision based on a cost-benefit analysis already carried out by the government. That analysis, commissioned by Transport Minister Danilo Toninelli, a 5-Star politician, found the TAV was a waste of public money, estimating the economic return would be a negative balance of $7.9-$8.8 billion. Conte, who is technically not a member of either party but is closer to 5-Star, called the funding of the TAV “iniquitous” and said he would speak to France and the EU “to share our doubts and perplexities.”

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Like the part where Big Pharma gets the big subsidies.

Dutch Pharmacies Join Backlash At Expensive Drugs By Making Their Own (R.)

In a radiation-proof room at the Erasmus Medical Center in Rotterdam, Emar Thomasa sits behind shielded glass as he carefully measures and mixes lutetium octreotate, an intravenous treatment for certain types of cancer. The Dutch hospital has been offering it to patients for more than a decade at 16,000 euros ($18,000) for one course of treatments. Drug firm Novartis, which in 2018 acquired rights to sell it in Europe, is asking more than five times that for its proprietary version, Lutathera. Thomasa is part of a protest against high drug prices launched by an unlikely group of rebels: Dutch pharmacies.

Three – Erasmus, Amsterdam’s University Medical Center (UMC) and the Transvaal Pharmacy in The Hague – have vowed to bypass drug company products and make treatments for a handful of rare diseases themselves, exercising their right to “compound” medicines. The Dutch market is small, with only hundreds of patients for the diseases in question. But the dispute is part of a growing global backlash against high drug prices, from the United States and Canada to Japan, and campaigners said it was being closely watched by health experts elsewhere. “People with rare diseases are dependent on medicines that are so expensive that they can’t afford them, when they could be offered for a much lower price,” said UMC pharmacist Marleen Kemper.

“The pharmaceutical industry plays an important role in developing good products, but we think it’s not fair if these firms make big money off these patients.” Compounding is the ancient practice of preparing medicines for individual patients. Pharmacists are trained to compound, though nowadays most medicines are made by industrial producers. Drug companies have raised concerns about the safety of compounded medicines that have not been approved by European regulators. But the specialized compounding pharmacies, which have on-site laboratories, have been backed by the Dutch government as part of efforts to tame rapidly rising medicine costs.

[..] The first two drugs targeted by Dutch pharmacies are Novartis’s Lutathera and a drug called CDCA, registered in Europe by Leadiant. High prices are not unusual for new rare disease drugs, as companies must recoup development costs from a relatively small group of patients. Novartis charges 92,000 euros for a one-off course of four Lutathera injections. But while the drug is innovative, its development costs were relatively small and cannot justify the price tag, said Erasmus MC Chief Executive Ernst Kuipers. Main development costs amounted to about 40 million euros, including 15 million euros in public funding, according to Erasmus – where most of the testing took place – and a review published in the Dutch Journal of Medicine.

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Jim at his best.

A Place of Your Own (Jim Kunstler)

I don’t think you can overstate the damage we’ve done to ourselves in the sheer material arrangement of our national life. A decade ago, I sat in on many zoning board meetings called to approve new WalMarts and other chain-stores around my region of upstate New York and southern Vermont. Inevitably, the companies organized a claque of locals in the meeting hall — itself a depressing, low-ceilinged chamber of cinder blocks and fluorescent lighting — to fill the seats and yell in support of “bargain shopping.” That was some bargain they got. The chain-stores got approved and the Main Streets died, but that wasn’t the end of it. This dynamic also destroyed networks that gave local citizens an economic and social place.

Locally owned business people were the caretakers of the town. They took care of two buildings — their place of business and their home. They sat on library, school, and hospital boards and donated money to running local institutions. They employed people who lived in town and there were consequences for treating them well or badly. There was even a time in this country when local business people wouldn’t dare to put up an insultingly ugly building. A lot of this economic behavior has produced the social perversities of our time. Exterminating an entire class of local merchants has eliminated the heart of the American middle-class and grotesquely concentrated the nation’s wealth among corporate leviathans who comprise one percent of the population.

It also eliminated the place where young people learned how to do business, preparing themselves to try ventures of their own, and to make a place for themselves in the world. What is your place now? A cubicle in the marketing department of Old Navy? An aisle in the Home Depot? A desk in the Diversity and Inclusion office of some State University, pushing to sort the student population into racial and sexual categories because all other ways of belonging in society are gone? Or do you occupy ten square feet of sidewalk with a tarp and a shopping cart? None of those places are liable to furnish a personal sense that life is worth living.

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Mar 082019
 


Pablo Picasso Visage 1928

 

Paul Manafort Sentenced To 47 Months In Prison (ZH)
ECB’s Surprise Policy Moves Send Shivers Through Global Stock Markets (MW)
US Dollar Hits 52-Week High on New ECB Stimulus (WS)
China Exports Fall 20.7% In February; Trade Data Much Weaker (CNBC)
China’s February Trade Surplus With US Narrows Sharply To $14.72 Billion (R.)
US Households See Biggest Decline In Net Worth Since Financial Crisis (CNBC)
Fed QE Unwind Reaches $501 Billion, Balance Sheet Falls Below $4 Trillion (WS)
Germany Won’t Ban Huawei, Says Ready To Oppose US Pressure (RT)
May Urges EU To Agree Brexit Backstop Changes (BBC)
Corbyn Backtracks On Final Say Referendum (Ind.)
British Life Expectancy Falls By Six Months (G.)
Default Or Exit: A Battle Between Italy And The EU Is Inevitable (OR)
Blackout Darkens Much Of Venezuela (AFP)
This Jew Tells Speaker Pelosi: “You May Well Prove Ilhan Omar Correct” (Cohen)
Chelsea Manning Risks Jail To Fight WikiLeaks Grand Jury (SP)

 

 

Shimon Prokupecz from the courtroom: “Judge tells the courtroom that Manafort is not being sentenced for anything related to the Special Counsel’s investigation into Russian interference. Ellis said “He is not before the court for anything having to do with colluding with the Russian government”

So what’s the Guardian headline? “Trump-Russia figure Paul Manafort jailed”.

Paul Manafort Sentenced To 47 Months In Prison (ZH)

In a surprise decision that stands as a slap in the face to Special Counsel Robert Mueller, Judge Ellis handed Paul Manafort a surprisingly light sentence of 47 months -or just under four years in prison – rejecting federal sentencing guidelines that recommended Manafort face up to 24 years in prison – a sentence that would have effectively condemned him to die in jail. Manafort was also fined $50,000 (equivalent to a few of Manafort’s bespoke suits) and ordered to pay restitution of $25 million. At this rate, Manafort might be out before Mueller finally wraps up his probe.

Early in the trial, Manafort appeared headed for a stiff sentence despite showing up in court in a wheelchair and green prison jumpsuit. Initially, after a lengthy review of Manafort’s charges, Ellis, who presided over Manafort’s August trial, said he would reject his lawyers’ request for leniency and accused the former Trump campaign executive of not being entirely forthcoming with the court about his finances. Furthermore, he refused to give him credit for accepting responsibility for his crimes, and also rejected his lawyers’ argument that the fact that Manafort hadn’t been found complicit in Russian collusion detracted from the charges for which he was convicted. When it came time for their statement, prosecutors told the judge Manafort offered little meaningful help during his 50 hours of meetings with investigators, and that the main reason he spent so much time with investigators was because he had lied.

But when it came his turn to speak, Manafort sounded genuinely contrite, telling the judge he felt “humiliated and ashamed” for what he’d done, and that the last two years had been “the most difficult years for my family and I.” “I appreciate the fairness of the trial you conducted,” he said. “My life is professionally and financially in shambles.” In the first indication that the sentence would be lighter than many had anticipated, the judge told Manafort and the court that he felt the federal sentencing guidelines were too stiff, and that Manafort had led an “otherwise blameless” life. Ellis recommended that Manafort – who is reportedly suffering from gout and other unspecified health issues – serve his sentence in a Cumberland, Maryland prison camp. He also credited him with nine months already served.

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The power of central banks is destructive in every possible sense.

ECB’s Surprise Policy Moves Send Shivers Through Global Stock Markets (MW)

Mario Draghi has been grumbling about the deleterious side effects of trade tensions and other geopolitical worries for months, but the ECB’s surprise policy moves in the face of a slowing global economy appeared to bring the danger home to investors. Stocks on Wall Street fell alongside European equities, underlining rising worries among investors that weakness in the global economy could prove to be a drag on U.S. growth. While analysts had expected the ECB president to strike a dovish tone, policy makers went much further than anticipated.

First, the ECB extended its so-called forward guidance on ultralow interest rates, saying it doesn’t expect to begin lifting them until at least early 2020. That’s compared to its earlier plan to leave them on hold at least through the end of this summer. Second, the ECB launched its third iteration of a program of cheap loans — known as targeted long-term refinancing operations, or TLTROs — to eurozone banks. It all came as ECB staff slashed their macroeconomic forecasts, including reducing the outlook for 2019 GDP growth to 1.1% from a previous 1.7% and signaling that inflation will take even longer to reach the central bank’s target of near but just below 2%. Price stability is the ECB’s sole policy mandate.

Draghi’s comments on the economy were getting the blame from analysts and investors for a decline in European and, in part, U.S. stocks. The pan-European Stoxx Europe index ended 0.4% lower, while on Wall Street, the S&P 500 and the Dow Jones Industrial Average ended with a loss of more than 200 points, or 0.8%, after declining 320 points at its session low. European government bonds rallied and the euro extended a decline versus the U.S. dollar.

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Draghi just scared friend and foe. Get rid of him, and his job. The damage is unthinkable.

US Dollar Hits 52-Week High on New ECB Stimulus (WS)

The Dollar Index (DXY), which tracks the dollar against the euro, yen, pound sterling, Canadian dollar, Swedish krona, and Swiss franc, and which is dominated by the euro, jumped 0.83% to 97.71 at the moment, hitting at least briefly its 52-week high, as the euro slumped 1.1% against the dollar, following the ECB’s announcement earlier today. But it wasn’t just a one-day event for the dollar, but an eight-day rally in an uptrend that started in early February. The real worry is the economy in the Eurozone – despite the fabulous stimulus the ECB has heaped on it for years, including a brutal negative-interest-rate policy and massive QE that has inflated the ECB’s balance sheet to over 40% of Eurozone GDP (by comparison, the Fed’s balance sheet is down to 19.5% of US GDP).

The Eurozone economy is deteriorating rapidly. In the post-meeting press conference today, ECB president Mario Draghi announced that the ECB had slashed its economic growth forecast for the Eurozone to 1.1% for 2019, a sharp cut from its forecast of 1.7% growth at the December meeting, and down from its 1.9% growth forecast last summer. “Incoming data have continued to be weak, in particular in the manufacturing sector, reflecting the slowdown in external demand compounded by some country and sector-specific factors,” the statement says.

Instead of admitting that its radical experimental monetary policies were a colossal error as the economic growth is now dwindling despite or because of the stimulus, and instead of gradually raising its policy rates above the rate of inflation to end its brutal “financial repression,” and instead of shedding the bonds on its balance sheet to push up long-term interest rates and force a restructuring of the bogged-down European economy so that it would liquidate or restructure the debts of zombie companies and lighten the load of restructured companies to allow them to have a fresh start – all of it at investors expense – the ECB does the opposite.

It promises new bank liquidity programs in the Eurozone which is already drowning in central-bank liquidity, to get banks to lend more to these zombie companies and keep them from restructuring their debts.

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When did that big Party meeting end?

China Exports Fall 20.7% In February; Trade Data Much Weaker (CNBC)

China on Friday reported worse than expected trade data for the month of February, customs data showed amid Beijing’s trade dispute with the U.S. Dollar-denominated exports plunged 20.7 percent for the month of February from a year ago, missing economists’ expectations of a 4.8 percent decline, according to a Reuters poll. January exports had risen 9.1 percent from a year ago. Dollar-denominated imports fell 5.2 percent in February from a year ago, missing economists’ forecast of a 1.4 percent fall. January imports had fallen 1.5 percent on-year. China’s February trade balance was also significantly weaker than expected at $4.12 billion. Economists polled by Reuters had expected the overall trade balance to come in at $26.38 billion.

The country’s trade balance in January had been $39.16 billion. China’s politically sensitive trade surplus with the U.S. narrowed sharply to $14.72 billion in February from $27.3 billion in January. Although the 20.7 percent decline in Chinese exports for the month of February was a “big number” and the market will be “clearly disappointed,” the negative number should not come as a surprise as investors have been expecting a slowdown both globally and in China, said Sarah Lien, director and client portfolio manager at Eastspring Investments. “There are a lot of headwinds; there’s a lot of moving parts in market,” Lien told CNBC.

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So no currency manipulation needed?

China’s February Trade Surplus With US Narrows Sharply To $14.72 Billion (R.)

China’s trade surplus with the United States narrowed to $14.72 billion in February, from $27.3 billion in January, customs data showed on Friday. For January-February combined, China’s trade surplus with the U.S. stood at $42.1 billion. China’s large trade surplus with the United States has long been a sore point with Washington, and is at the center of a bitter dispute between the two countries. In 2018, the two governments imposed tit-for-tariffs on goods worth hundreds of billions of dollars.

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Do note: what wealth there is, or is measured, sits in real estate and stocks, the very two biggest bubbles blown by the Fed. Net worth my donkey.

US Households See Biggest Decline In Net Worth Since Financial Crisis (CNBC)

Americans’ net worth fell at the highest level since the financial crisis in the fourth quarter of 2018 as sliding stock market prices ate into the household balance sheet. Net worth dropped to $104.3 trillion as the year came to an end, a decrease of $3.73 trillion from the third quarter, according to figures released Thursday by the Federal Reserve. The fall amounted to a drop of 3.4 percent. Much of the slide came due to Wall Street’s woes, as the stock market suffered a precipitous decline that started in October and briefly reached bear market status. Equities skidded as investors began to fear that the Fed would keep raising interest rates even as economic conditions began to deteriorate. By the time the market drop ended in late December, households saw $4.6 trillion worth of equity value deteriorate.

The decline was offset somewhat by a $300 billion increase in real estate value. The overall move was the second-highest quarterly dollar drop since the Fed began tracking the statistic. Overall, financial assets totaled just more than $85 trillion at the end of the year, while real estate value was $29.2 trillion. Household net worth has been rising strongly since the crisis and is up 73 percent since 2009. After suffering their worst Christmas Eve in history, stocks staged a turnaround and ultimately saw their best two-month start to a year since at least 1991. The Dow Jones Industrial Average is off about 1.6 percent in March though still up more than 9 percent year to date.

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Cui bono.

Fed QE Unwind Reaches $501 Billion, Balance Sheet Falls Below $4 Trillion (WS)

Over the next few months, the Fed is expected to announce its new plan for its balance sheet. Meanwhile, as we’re riveted to the edge of our seat, the old plan continues on autopilot, and February was one of the few months when the Treasury “roll-off,” as Chairman Jerome Powell likes to call it, hit the “caps.” In February, the Fed shed $57 billion in assets, according to the Fed’s balance sheet for the week ended March 6, released this afternoon. This slashed the assets on its balance sheet to $3,969 billion, the lowest since December 2013. Via its “balance sheet normalization,” the Fed has now shed $501 billion. And since peak-balance-sheet at the end of 2014, the Fed has shed $547 billion:

During peak-balance-sheet at the end of 2014, total assets ($4.52 trillion) amounted to 26% of GDP. Today’s assets amount to 19.4% of GDP. In the years before QE started, the balance sheet ran around 6% of GDP. By comparison, the ECB’s balance sheet assets now exceed 40% of GDP, and the Bank of Japan’s assets amount to 101% of GDP. February’s drop of $57 billion is larger than the scheduled QE unwind that is capped at $50 billion. But the Fed has other activities that impact the balance sheet. QE revolved around Treasury securities and mortgage-backed securities (MBS). And so does the QE unwind.

[..] On February 15, three issues of Treasury securities on the Fed’s balance sheet totaling $43.5 billion matured. On February 28, three issues totaling $12.5 billion matured. This brought the total for the month to $56 billion – above the cap of $30 billion. So the Fed reinvested $26 billion in new Treasury securities and allowed $30 billion of Treasuries to “rolled off” the balance sheet without replacement. This reduced the total balance of Treasury securities by $30 billion, to $2,175 billion, the lowest since December 2013 – and down by $290 billion since the QE unwind began. This has whittled down the Treasuries acquired during the infamous “QE Infinity” by about one-third:

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When it comes to things like 5G networks, which cross borders, the rest of Europe has little choice but to follow Germany.

Germany Won’t Ban Huawei, Says Ready To Oppose US Pressure (RT)

Germany does not intend to prevent Chinese tech giant Huawei from developing 5G networks, the country’s economy minister said, adding that the EU stands ready to defend its interests, should a trade war with Washington escalate. Berlin will not pre-emptively ban any specific companies from bidding for contracts to develop the country’s next generation 5G mobile network, despite immense pressure from the United States to ostracize Huawei, Peter Altmaier said on Thursday evening, during a debate on ZDF television. “No, we will not want to exclude any company,” he stressed, explaining that the government is capable of implementing enough safeguards to protect Germany’s future networks.

Ignoring Washington’s earnest ‘concerns’ that, through Huawei systems, the Chinese government is planning to spy on the entire world, German authorities produced a list of telecom security requirements on Wednesday. Part of the new German rules requires certifying any security-related components with Germany’s IT security agency. The 5G network “may only be sourced from trustworthy suppliers whose compliance with national security regulations and provisions for the secrecy of telecommunications and for data protection is assured,” Germany’s Economic Ministry and the Federal Network Agency said in their guidelines. Thus Huawei, which has recently sued the US government demanding to see any proof behind their claims, can participate in the tendering process if it meets the requirements set out by Berlin.

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3 weeks to D-Day. Cue blame game.

May Urges EU To Agree Brexit Backstop Changes (BBC)

Theresa May will urge the EU to help get her Brexit deal through the Commons by agreeing legally binding changes to the controversial backstop. On Friday, she will say the EU’s actions will “have a big impact on the outcome” when MPs vote on it next week. But Labour’s Sir Keir Starmer said it was now “clear” the PM “will not be able to deliver the changes she promised to her failed Brexit deal”. The EU says the UK must come forward with new ideas to break the deadlock. The UK is due to leave on 29 March.

Mrs May will visit workers in Grimsby, Lincolnshire, on Friday, days before the second “meaningful vote” in the Commons on the withdrawal deal she has negotiated with the EU. She will tell them: “Just as MPs will face a big choice next week, the EU has to make a choice too. “We are both participants in this process. It is in the European interest for the UK to leave with a deal. “We are working with them but the decisions that the European Union makes over the next few days will have a big impact on the outcome of the vote.”

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Has Corbyn done anything not wrong?

Corbyn Backtracks On Final Say Referendum (Ind.)

Labour has admitted it will not support a new referendum on Brexit in all circumstances, in a major blow to those in the party campaigning for one. Sources close to the Labour leadership confirmed that the party is not advocating a referendum on anything other than a “damaging Tory Brexit” and will not support one if Britain leaves the EU on terms that Labour backs. The Independent has learnt that the issue was the subject of a row between Mr Corbyn’s shadow ministers that pitted Keir Starmer and Emily Thornberry against Brexit-backing frontbenchers led by Jon Trickett. As it dawned on Labour Remainers today, a prominent MP who backs the People’s Vote campaign warned that a failure of the party to follow through on the pledge to back a new referendum would be seen as a “betrayal”.

It comes as deputy leader Tom Watson is in the process of forming a new “social democrat” group within the party, while eight MPs have quit the party, in large part over Brexit policy, to form the new Independent Group. Labour said last week that it would support a vote on any “credible” exit plan passed by parliament, and shadow ministers took to the airwaves to promise to demand a “confirmatory referendum” on “whatever deal may or may not pass through parliament”. However, sources have now told The Independent that the party will only support a referendum on a “damaging Tory Brexit” deal. Crucially, it is understood that Labour does not consider this to include the type of arrangement being proposed by former Conservative ministers Sir Oliver Letwin and Nick Boles, who Mr Corbyn held talks with yesterday. Their plan would keep the UK in the single market and a customs union with the EU.

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This should panic the country like nothing else. But instead all the talk is Brexit and they’re signaling the advantages for pension schemes of people dying younger.

British Life Expectancy Falls By Six Months (G.)

British adults’ life expectancy has been cut by six months in the biggest reduction in official longevity forecasts. The Institute and Faculty of Actuaries, which calculates life expectancy on behalf of the UK pension industry, declined to speculate on why longevity is deteriorating for men and women in England and Wales. Some analysts, however, blame austerity and cuts in NHS spending, others point to worsening obesity, dementia and diabetes. The institute said it now expects men aged 65 to die at 86.9 years, down from its previous estimate of 87.4 years, while women who reach 65 are likely to die at 89.2 years, down from 89.7 years. The actuaries said the evidence of slowing life expectancy that first emerged around 2010-11 is “a trend as opposed to a blip”. Falling longevity has accelerated.

Last year’s analysis cut forecasted life expectancy by two months. This year it took off another six months. Compared with 2015, projections for life expectancy are now down by 13 months for men and 14 months for women. Flat or falling longevity has major implications for health, finance and government policy. The state pension age is planned to rise to 68 in 2037, and the government has floated the idea of increasing it to 70 but will come under pressure to backtrack if longevity drops. [..] Pension companies have already begun to cash in on falling expectations. This week Legal & General said it was releasing £433m of the reserves it holds to pay future pensions because of the reductions in longevity expectations.

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European parliament elections in May. That will bring a lot into the open.

Default Or Exit: A Battle Between Italy And The EU Is Inevitable (OR)

There is a dual Italian crisis brewing in the European Union. On the one hand, it is a political, or even geopolitical, crisis. Italy is undermining the unity of the European Union; blocking the EU’s recognition of those behind the coup in Venezuela as the legitimate authority; preventing the expansion of sanctions against Russia; and even supporting the ‘yellow vest’ movement in France, which is arousing the anger of the French government. On the other hand, the crisis is economic in nature. Italy is once more sliding into a recession (economic growth was negative in the country); Italian banks are again facing financial problems; and the business media has already estimated that the Italian economic crisis could blow up the entire European banking system.

There is a strong possibility that the EU’s leaders will soon be faced with a choice: try to save Italy (and the whole of Europe) from yet another crisis or set an example by punishing the Italian government for the country’s independent economic and foreign policies. In turn, Italian Prime Minister Giuseppe Conte’s government will most likely have its own dilemma to deal with: bow down and sell its principles to get help from Brussels or go all out and regain Italian independence. The choice will not be easy and either decision will be painful. Neither ending to this Italian drama could really be called happy. As this headline in The Telegraph quite rightly notes: “Crisis brewing in Italy will lead to default, exit from the euro, or both.”

[..] To really understand the Italian problem, it should be borne in mind that, as a member of the European Union and the eurozone, Italy does not have full national sovereignty, especially when it comes to economic matters. It does not control the monetary policy of the European Central Bank and cannot even prepare a budget in line with the wishes of its own government or parliament without the risk of running into sanctions or fines from the European Commission. What’s more, Italian eurosceptic politicians suspect that the European Commission (in which the main roles belong to people hand-picked by Germany, France and the US) is punishing Italy and literally strangling its economy because of a political dislike of the Italian government’s geopolitical actions.

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If this happens more often it won’t be a coincidence.

Blackout Darkens Much Of Venezuela (AFP)

Most of Venezuela plunged into darkness on Thursday evening as a blackout served up more misery for people enduring an economic crisis that has fueled a potent challenge to President Nicolas Maduro’s rule. The socialist government quickly blamed the outage affecting 23 of the country’s 24 states on what it called sabotage of a major hydroelectric dam. In Caracas, traffic lights went out and the subway system ground to a halt, triggering gridlock in the streets and huge streams of angry people trekking long distances to get home from work. The blackout in the capital was total and hit at 4:50 pm (2050 GMT), just before nightfall. Caracas is one of the world’s most crime-ridden cities so people set out for home early, well before the sun went down.

Commerce was shut down because most transactions are done with debit or credit cards. Hyperinflation has rendered the local currency, the bolivar, almost worthless. Telephone services and access to the internet were also knocked out. The capital’s international airport was hit, according to social media posts from would-be travelers. A Copa Libertadores football game in the city of Barquisimeto was postponed. As night set in, the nationwide outage dragged on and some people in Caracas banged pots and pans – a traditional Latin American method of letting off steam. About seven hours after the mess started, the lights did come back on in some buildings in eastern Caracas.

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But campaign finance!

This Jew Tells Speaker Pelosi: “You May Well Prove Ilhan Omar Correct” (Cohen)

Speaker Nancy Pelosi is reportedly still considering a symbolic “show vote” in Congress on an anti-Semitism and “hate” resolution – which would offer all the authenticity and honesty of a Soviet show trial. If Pelosi proceeds, it will prove Rep. Ilhan Omar’s point about the inordinate influence wielded over Congress by the “Israel-right or-wrong”/AIPAC lobby and its power to stifle criticism of Israel. The anti-Omar resolution, whether mentioning Omar or not, was originated by two Democrats who are among Congress’s most longstanding pro-Israel diehards: Eliot Engel and Nita Lowey. Both endorsed Bush’s Iraq invasion. Both opposed Obama’s Iran nuke deal. Both supported Trump’s move of the U.S. embassy to Jerusalem.

I’m a proud Jew raised in a liberal family that supported civil rights and human rights. My experience growing up during the 1950s and 1960s was typical of many Jewish Americans. Like many Jews with this background, I’ve grown increasingly ashamed of Israel. For 40 years, Israel has been ruled mostly by a series of right-wing governments – more and more openly racist and abusive of Palestinian rights. It’s not the land of tree-planting, kibbutzim and “a country treating its Arab minority nicely” that we were sold as youngsters. That’s why a large number of proud Jewish Americans – raised to believe in civil liberties and open discussion – are appalled by the campaign to muzzle Rep. Ilhan Omar, as well as Speaker Pelosi’s role in it. We’re also appalled that human-rights-abusing Israel is virtually off-limits to debate.

[..] Rep. Omar has made a simple and undeniable point – that AIPAC (American Israel Public Affairs Committee) and the funding it [receives] influences exert extraordinary power over Congress. Disputing that point is flat-earther terrain. The Capitol Hill farce of an “anti-hate” resolution would provide still more evidence on behalf of her argument.

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We lock up our best, brightest and bravest. It’s the only way we can continue on our present paths. But there should be a big Hollywood movie in the works about Chelsea Manning as a role model for all young Americans.

Chelsea Manning Risks Jail To Fight WikiLeaks Grand Jury (SP)

Chelsea Manning will face a closed contempt hearing after she refused to answer questions during proceedings held by a grand jury in Alexandria, Virginia, that is investigating WikiLeaks. The WikiLeaks grand jury investigation has been ongoing in some form or another in Alexandria since at least December 2010. It was convened by the Justice Department in response to disclosures Manning made to WikiLeaks in 2010, when she was an intelligence analyst for the United States Army. What Manning disclosed exposed war crimes, diplomatic misconduct, and other instances of wrongdoing and questionable conduct by U.S. government officials. But she arrested, subject to a court-martial, and convicted of violating the Espionage Act and other related offenses.

She received a 35-year sentence and was released after six years in military prisons because a grassroots campaign successfully pressured President Barack Obama to commute her sentence. “A judge will consider the legal grounds for my refusal to answer questions in front of a grand jury. The court may find me in contempt and order me to jail,” Manning stated. On March 6, Manning appeared before the grand jury after she was granted immunity for her testimony. “All of the substantive questions pertained to my disclosures of information to the public in 2010—answers I provided in extensive testimony during my court-martial in 2013. I responded to each question with the following statement: ‘I object to the question and refuse to answer on the grounds that the question is in violation of my First, Fourth, and Sixth Amendment, and other statutory rights.’”

Manning added, “In solidarity with many activists facing the odds, I will stand by my principles. I will exhaust every legal remedy available. My legal team continues to challenge the secrecy of these proceedings, and I am prepared to face the consequences of my refusal.” She could face up to 18 months in jail if she is found “in contempt” of court. A legal attempt to quash the subpoena prior to her appearance before the grand jury was rejected by a federal judge on March 5. Grand juries can be empaneled for 18 months, or if they are “special” grand juries, they may last up to 36 months. Over the past eight years, the grand jury has presumably gone through multiple iterations, either being renewed or relaunched.

According to a report from the Washington Post, the grand jury is interested in whether WikiLeaks editor-in-chief Julian Assange solicited Manning to disclose documents. Manning testified during her court-martial about accounts linked to WikiLeaks, or WLO, that she communicated with. It is possible she communicated with Assange, but they never exchanged identifying information. “No one associated with the WLO pressured me into giving more information. The decisions that I made to send documents and information to the WLO and the website were my own decisions, and I take full responsibility for my actions,” Manning asserted. The grand jury would like to try and poke holes in Manning’s testimony to try and build a case against Assange and possibly other staff members of WikiLeaks.

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Mar 062019
 


Pablo Picasso Bathers with ball 1 1928

 

Amazon To Release Mueller Report in Full Print on March 26 (Taer)
Roger Stone’s Book May Violate Gag Order (R.)
Sharply Lower Prices Help Sell New US Houses, But it’s Not Enough (WS)
Democrats In Search Of A Crime To Punish Trump And His Voters (Sara Carter)
Trump Slams Democrats Over Probe He Calls Harassment (MW)
House Dems’ Rebuke of Rep. Ilhan Omar is a Fraud For Many Reasons (Greenwald)
Will Congress Repair The Safety Net For Older Americans? (NA)
US Trucking Boom U-Turns (WS)
Division! Brexit Stretches Arcane British Parliament To Breaking Point (R.)
UK Cash System ‘On The Verge Of Collapse’ (G.)
BOE and ECB Activate Emergency Currency Swap Line (Ind.)
Toyota, BMW Warn No-Deal Brexit Could Hit UK Investment, Production (BBC)
What Do The People Of The World Die From? (BBC)
Arctic Animals Shift Feeding Habits (AFP)

 

 

Nice find.

Amazon To Release Mueller Report in Full Print on March 26 (Taer)

If you are a journalist looking for a copy of The Mueller Report, Amazon got news for you. They claim that the report will be out on March 26. It’s not clear if Attorney General William Barr has cleared the released of the full Mueller report. But Amazon announced today the pre-order of “The Mueller Report”, with an introduction by constitutional scholar Alan Dershowitz.

As CNN has previously reported, Barr has been closely consulting with top Justice Department officials on the outlines of plans to handle the highly anticipated report, including to what extent it should be shared with Congress, and by extension the public. Could this be a trick from Dershowitz to sell a book about the report or would it be the full report, this we will have to wait and see. Amazon also list Robert Mueller III as author of the book. The book will be offered in both e-book and paperback editions. This is a developing story that will be updated.

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A book that first came out in 2017. That can’t be it. It was re-published under another name and critized Mueller in its introduction. Oh, that’s it. Wait: it was published before the gag order was issued. No, so that can’t be it either.

Roger Stone’s Book May Violate Gag Order (R.)

A federal judge said Tuesday that the publication of a book last month by President Donald Trump’s former political adviser Roger Stone which criticized Special Counsel Robert Mueller may violate a media gag order – a transgression that could land the self-proclaimed “dirty trickster” behind bars. Judge Amy Berman Jackson for the U.S. District Court for the District of Columbia ordered Stone and his lawyers to provide her with a report by Monday explaining how he plans to comply with the order, and also demanded that he turn over certain records detailing everything he knew about the book’s release.

“There is no question that the order prohibited and continues to prohibit the defendant from making any public statements, using any medium, concerning the investigation,” Jackson wrote. “It does not matter when the defendant may have first formulated the opinions expressed, or when he first put them into words: he may no longer share his views on these particular subjects with the world.” Shortly after Stone was charged, Jackson gave him wide latitude to discuss the case against him as long as it was not in the vicinity of the federal courthouse. But just days later, she tightened the reins with a sweeping gag order after Stone posted a photo of her on his Instagram account next to an image resembling the crosshairs of a gun and a message critical of both her and Mueller.

In issuing her gag order on Feb. 21, Jackson warned Stone he would not have a second chance if he violated it. She also said his apologies about the posting, which was later removed, rang hollow. After the gag order, Jackson learned that a 2017 book by Stone originally titled “The Making of the President 2016” had been re-published under the name “The Myth of Russian Collusion” and that it criticized Mueller in its introduction. In addition, Stone also in March posted an item on Instagram that said “Who framed Roger Stone.” It was later removed. Stone’s lawyers have said the book does not violate the gag order because it came out on Feb. 19, before the order was issued.

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Did you notice the similarities between the US and China?

Sharply Lower Prices Help Sell New US Houses, But it’s Not Enough (WS)

Here is the good news: Lower prices stir sales. Clearly, homebuilders are motivated to move their inventory, and they’re making deals at lower prices. The median price of new single-family houses whose sales closed in December fell 7.2% from a year earlier, to $318,000, according to the Commerce Department this morning. December’s 7.2% drop and November’s blistering 11.6% drop were the sharpest year-over-year declines since Housing Bust 1:

The new-house sales data, produced jointly by the Census Bureau and the Department of Housing and Urban Development, is very volatile. It is revised in the following months, often quite drastically. But despite the ups-and-downs in the monthly data, trends emerge. The steep year-over-year price increases in prior years formed a multi-year boom in prices that has now outrun what the market can bear. The median price of new houses ballooned by about 55% from the range in 2011 and 2012 to the peak in November and December 2017 ($343,300), which exceeded by 31% the crazy bubble peak in March 2007, before it all came apart:

Sales of new houses, in terms of the seasonally adjusted annual rate, had plunged late last year. The year-over-year decline exceeded 15% in November. So in December, this seasonally adjusted annual rate of sales finally responded to lower prices and declined a little, instead of plunging. The year-over-year drop of 2.4%, to an annual rate of sales of 621,000, was the fourth month in a row of year-over-year declines – but a heck of a lot less bad than the double-digit plunges in the prior two months:

That the price declines have not moved the needle enough also shows up in the inventory of new houses for sale that just keeps on rising. In December, the supply surged 17% year-over-year to 344,000 houses, for a supply of 6.6 months at December’s rate of sales (up from 5.5 months a year earlier):

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Trump has this one down: “Basically they’ve started the campaign..”

Democrats In Search Of A Crime To Punish Trump And His Voters (Sara Carter)

The House Judiciary Committee’s Democratic Chairman Rep. Jerrold Nadler is a man in search of a crime. Nadler and his colleague House Intelligence Committee Chairman Adam Schiff have moved the conversation from Russian collusion and are now promising to investigate virtually everything connected to President Donald Trump. Mind you, we the tax payers will be paying for these investigations and it will drag America and the administration into another two years of endless witch hunts. Yes, a witch-hunt. Can you imagine if someone despised you so much that all they did day in and day out was search for something, anything, that would get those around you to doubt your intentions. Imagine having to fight every single day of your life against never ending accusations.

Even when those accusations are later proven false it won’t matter because the original lie has already been thoroughly disseminated far and wide among the population. Why are Nadler, D-NY, and Schiff, D-CA, promising these investigations? Because they want to impeach Trump. It’s just that simple. They also want to send a message to the American people: your vote really didn’t matter because in the end it’s Congress that holds the power. Think about that. There was never any evidence of crime that called for Deputy Attorney General Rod Rosenstein to establish a special counsel. Yet, he did. In fact, he wrote the letter authorizing Trump to fire former FBI Director James Comey. Comey would’ve been fired the first day had Hillary Clinton been president. However, obstruction charges are at the top of the Nadler’s list of investigations.

He also promises to investigate all of Trump’s financial dealings and past business associations. Why? The pair realize that Special Counsel Robert Mueller’s report will not do the damage they were hoping it would. Both Democratic leaders, supported by their party, realize that Mueller has found no evidence of a conspiracy with the Russians. It has left believers like Schiff, Nadler and many former Obama Administration officials who’ve worked diligently over the past several years to destroy Trump, seething. They do not want to go on the defensive. Nadler and Schiff don’t want to explain that their narrative has been debunked. They do not want Americans to look too close because in the end what will be discovered is that the crimes they are accusing others of committing are the ones they themselves have committed.

So what do they do? They fish for a crime, use the media to propagate their lies and spread malicious rumors. Those crimes can be anything from obstruction of justice, process crimes or financial crimes. The lawmakers will use the power of America’s purse. They will investigate Trump’s children, those who support him and those who work closely with him at the White House. nHowever, remember this: It is the American people, liberty and the principals endowed in our Constitution that will pay the heaviest burden. Nadler announced his probe on Monday into potential “obstruction of justice.” He will lob accusation, after accusation, against the Trump administration and his family. He will seek documents and communications from over 60 individuals connected with the White House. He will look for that needle in a haystack for as long as it takes.

Nadler and Schiff will conduct what they describe as thorough investigations. They will keep these lengthy investigations going to buy time on the clock until they get close to the Democratic National Convention. Nadler will do so at the cost of our nation. Don’t be fooled. He doesn’t care about the American people or justice. In the end, this all about ‘getting back’ for the Democrats.

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You won’t find anyone saying: “but he’s the president, the people voted for him” anymore. What will that mean for subsequent presidents?

Trump Slams Democrats Over Probe He Calls Harassment (MW)

President Donald Trump on Tuesday escalated attacks on Democrats investigating him and his associates, as he signed an executive order establishing a task force addressing veteran suicide. Trump blasted Democrats who have launched an investigation into his White House and allies, saying on Twitter that lawmakers including House Judiciary Committee Chairman Jerry Nadler are looking to “harass” the 81 individuals and entities they’re seeking documents from. Those individuals include Trump’s sons Eric and Donald Jr., as well as David Pecker, chairman and CEO of American Media, which publishes the National Enquirer.

Calling Nadler and House Intelligence Committee Chairman Adam Schiff “stone cold CRAZY,” Trump said letters were “sent to innocent people to harass them.” White House press secretary Sarah Sanders said late Monday the investigation was “disgraceful and abusive.” Nadler said his committee is beginning a probe into possible obstruction of justice, corruption and abuse of power. Trump later said Democrats’ probe was a “disgrace” and said they wanted to “play games” instead of work on infrastructure or health care. “Basically they’ve started the campaign,” he said.

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They’ve started the campaign. But they actually believe they can get rid of Ocasio and Omar whenever they want. And that’s not true. The old guard is done.

House Dems’ Rebuke of Rep. Ilhan Omar is a Fraud For Many Reasons (Greenwald)

GOP Congressman Steve King has served in the U.S. House of Representatives for sixteen years, yet Democrats – who controlled the House for four of those years and now control it again – never formally rebuked or condemned him until last month (they did so at the same time that Republicans removed him from his Committee assignments due to a long history of white supremacist remarks). By extremely stark contrast, Democratic Congresswoman Ilhan Omar – the first black Muslim woman ever elected to the Congress – has served in the House for a little more than two months, and House Democratic leaders have already formally condemned her once and are preparing to so again, this time even more harshly and officially, on Wednesday.

On February 11, the House Democratic leadership, responding to statements made by Omar about large donors and AIPAC driving pro-Israel policies, issued a joint statement condemning Omar for what they called her “use of anti-Semitic tropes,” adding that her “prejudicial accusations about Israel’s defenders” are “deeply offensive.” They then demanded: “We condemn these remarks and we call upon Congresswoman Omar to immediately apologize for these hurtful comments.” Omar then issued a statement of her own in which she “unequivocally apologized” for unintentionally invoking “anti-Semitic tropes,” but made crystal clear that “the problematic role of lobbyists in our politics” – whether it be AIPAC, as well as the NRA or the fossil fuel industry – was one she would continue to aggressively address and combat.

The Congresswoman quickly made good on her promise to continue speaking out about AIPAC’s toxic influence, the destructive and immoral support given to Israel by the U.S., and the subordination of Americans’ Constitutional rights and the country’s national interests to that foreign nation. Speaking last Wednesday in Washington at a town hall meeting with several other progressive House members, Congresswoman Omar was asked about the use of the “anti-semitism” label to shut down debate over Israel. In reply, she said: “I want to talk about the political influence in this country that says it is OK to push for allegiance to a foreign country.” That remark created a new outburst of anti-Semitism accusations against Omar, initially provoked by New York Magazine’s Jonathan Chait, whose column carried the most sensationalistic and misleading headline possible: “Ilhan Omar Accuses Israel Hawks of ‘Allegiance to a Foreign Country.’”

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Small detail: older Americans own lots of firearms.

Will Congress Repair The Safety Net For Older Americans? (NA)

The first two federal safety net programs, Social Security and Unemployment Insurance, will turn 65 next year. This historic milestone is being preceded by a new focus from the new Congress on how the government’s safety net programs are performing and what changes might be needed to improve them. Safety net programs have evolved over time, from Head Start in 1964 to Supplemental Security Income in 1972 to the Affordable Care Act (ACA) of 2010, with its expansion of Medicaid to approximately 15 million people. And social safety net programs have done a lot of good over time. For example, Social Security has lifted an estimated 27 million people out of poverty. However, against this backdrop are some more disturbing realities.

First, many eligible Americans, especially older adults, are not receiving safety net benefits to which they are entitled. For example, the National Council on Aging estimates that almost 60% of older Americans eligible for the Supplemental Nutrition Assistance Program (SNAP; formerly known as food stamps) aren’t enrolled. Access to federal benefits is especially challenging for older women, who represent nearly two-thirds of all people 65 and older living in poverty. Certain safety net programs have shown a bias against women regarding benefits and coverage by considering work history and salary history; historically, women have been more likely to be unpaid caregivers and to have lower salaries than men. Fixing this type of bias is a prime example of potential safety net reform.

Second, safety net program benefits are not keeping up with the need. For example, Supplemental Security Insurance (SSI), a program for low-income older adults and people with disabilities, has only seen minimal benefit increases since it was created nearly 50 years ago. Third, the government’s measurement of what constitutes poverty for safety net programs, especially poverty of older adults, is grossly outdated. This results in many more older Americans living in poverty than the federal guidelines show. Finally, out-of-pocket health care costs are not sustainable for some poorer, older adults in the Medicare program, leaving many with hard choices between paying for food or rent.

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But cyclical.

US Trucking Boom U-Turns (WS)

Orders for Class-8 trucks – made by Daimler (Freightliner, Western Star), Paccar (Peterbuilt, Kenworth), Navistar International, and Volvo Group (Mack Trucks, Volvo Trucks) – plunged 58% in February compared to February last year, to 16,700 orders, according to FTR Transportation Intelligence after they’d already plunged 58% year-over-year in January and 43% in December. The orders in January and February were back in the range of the “transportation recession” that had hit the industry in 2015 and 2016. At the time, truck and engine manufacturers reacted with layoffs. But for now, they’re sitting on a massive backlog from the boom in orders last year (data via FTR):

The business is infamously cyclical, with regular booms that lead to over-ordering and then overcapacity, followed by busts that then sort it all out again. The industry is also seasonal, so we can use year-over-year comparisons to eliminate most of the effects of seasonality. The chart below shows the percent change of Class-8 truck orders for each month compared to the same month a year earlier. The year-over-year plunges over the past three months are of the same magnitude as the plunges during the last transportation recession (data via FTR):

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Brexit according to Henry VIII.

Division! Brexit Stretches Arcane British Parliament To Breaking Point (R.)

Britain’s 800-year-old parliament has a big decision to make, and little time to make it. After months of drama and delay, the country’s fate could be decided next week in a series of Brexit votes in which lawmakers must choose one of two wood-panelled corridors to shuffle down inside the neo-gothic Westminster palace. Each vote, known as a division, takes about 15 minutes. If it takes too long, the Serjeant-at-Arms, dressed in shiny black shoes, knee-high socks and a long woollen suit, will be sent bearing a ceremonial sword to investigate. Rich in pageantry and theater, Westminster’s parliamentary format has been adapted, modernized and exported to more than two dozen countries across the globe.

[..] On March 12, May is expected to try once more to get her deal approved, though much will rest on whether she can secure extra assurances from Brussels about the thorny issue of Northern Ireland’s border. If that vote fails, May will ask parliament a day later whether it wants to leave the European Union without any kind of exit deal – a potentially disruptive divorce with damaging consequences for the world’s fifth largest economy. If parliament rejects that outcome as well, lawmakers will then decide on March 14 if they want to try to delay Brexit, potentially opening the door to a wholesale renegotiation with the EU – or even a second referendum at home. If the process does go to a third ballot, when Speaker John Bercow bellows “Division!” and bells ring across parliament and beyond to alert lawmakers to the vote, Britain could be 15 minutes from taking its first step towards reversing Brexit.

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“17% of the UK population – over 8 million adults – would struggle to cope in a cashless society”. And nobody cares.

UK Cash System ‘On The Verge Of Collapse’ (G.)

More than 8 million UK adults would struggle to cope in a cashless society, according to a major report which claims that the country’s “cash infrastructure” is in danger of collapsing. With Britons increasingly turning to digital payments, and bank branches and ATMs closing, the Access to Cash Review said companies and organisations providing “essential” services should be required to ensure that consumers can continue to pay by cash. The review is funded by cash machine network Link, but is independent from it, and is chaired by the former head of the Financial Ombudsman Service Natalie Ceeney, with other members including Richard Lloyd, the former executive director of consumer group Which?.

Ceeney said that “17% of the UK population – over 8 million adults – would struggle to cope in a cashless society”. Debit cards last year officially overtook notes and coins as the most popular form of payment in the UK for the first time, and the review’s report predicted that cash could fall to just 10% of all payments within the next 15 years. It also called on the government, regulators and banks to “act now or risk leaving millions behind”. A spokesman for the review claimed the UK’s cash system was “on the verge of collapse”. The bill for running the UK’s cash infrastructure – from ATMs to cash-sorting centres – was about £5bn a year, paid for predominantly by banks (and, ultimately, consumers), said the report. But while the costs were largely fixed, income was declining quickly. As a result, it said, “we have a cash infrastructure which is fast becoming unsustainable”.

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EU banks hold 15 percent of UK bank debt and 10 percent of UK government bonds.

BOE and ECB Activate Emergency Currency Swap Line (Ind.)

The Bank of England and the European Central Bank (ECB) have agreed an emergency currency swap line to ensure banks have access to cash in the event of a no-deal Brexit. The agreement means the Bank of England will offer to lend euros to UK banks on a weekly basis while the ECB will receive pound sterling from the BoE in exchange for euros. It means that even if the UK crashes out of the EU without a deal, the country will still remain reliant on Frankfurt to help safeguard the financial system. “Activation marks a prudent and precautionary step by the Bank of England… supporting the functioning of markets that serve households and businesses,” the ECB said on Tuesday.

Since 2013, Britain has had similar swap lines with four other central banks: the US, Canada, Japan and Switzerland. The UK needs free access to supplies of foreign currencies to facilitate trade and much of the financial services industry. During a crisis, banks can find it hard to access the volume of foreign currency they need. It is at this point that central banks will be available to provide cash through so-called swap lines. There had been some speculation that the ECB would not support a euro swap line if no Brexit deal is agreed with the UK. But the ECB and BoE confirmed on Tuesday that the facility will be available. The ECB said it will continue to work closely with the Bank of England to monitor market conditions carefully.

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Good. Let them ride bicycles.

Toyota, BMW Warn No-Deal Brexit Could Hit UK Investment, Production (BBC)

Car giants Toyota and BMW have both warned a no-deal Brexit threatens the production of their cars in the UK. BMW told Sky News it could consider moving production of its Mini from the UK in a no-deal scenario. Separately, the head of Toyota’s European operations said a negative outcome could put future investment at its UK factory near Derby at risk. Johan van Zyl told the BBC that if the Brexit “hurdles” are too high it would undermine Toyota’s competitiveness. Speaking to Sky News, BMW board member Peter Schwarzenbauer said if a “worst case” no-deal scenario happened, “we would need to consider what it exactly means for us in the long run”. “For Mini, this is really a danger,” he added.

Asked if BMW could move Mini production out of Cowley near Oxford, he said: “We at least have to consider it.” Earlier, BMW chief executive Harold Krueger told the BBC that the carmaker was preparing “for a lot of scenarios” and was “very flexible” in its approach to production. He said the company had “reserved some air flight capacity for the transportation of bigger materials” and had prepared its suppliers. “The logistics network is very flexible to adjust to changes,” he said. The warnings come after Japanese rivals Nissan and Honda both recently dealt major blows to the UK motor industry. Last month, Nissan reversed a decision to build a new car in the UK , and Honda said it was closing its Swindon plant , although both cited non-Brexit reasons.

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Our food is killing us.

What Do The People Of The World Die From? (BBC)

Around the world, people are living longer. In 1950, global average life expectancy at birth was only 46. By 2015, it had shot up to over 71. In some countries, progress has not always been smooth. Disease, epidemics and unexpected events are a reminder that ever-longer lives are not a given. Meanwhile, the deaths that may preoccupy us – from terrorism, war and natural disasters – make up less than 0.5% of all deaths combined. But across the world, many are still dying too young and from preventable causes. The story of when people die is really a story of how they die, and how this has changed over time.

About 56 million people in the world died in 2017. This is 10 million more than in 1990, as the global population has increased and people live longer on average. More than 70% die from non-communicable, chronic diseases. These are not passed from person to person and typically progress slowly. The biggest single killer is cardiovascular disease, which affects the heart and arteries and is responsible for every third death. This is twice the rate of cancers – the second leading cause – which account for about one in six of all deaths. Other non-contagious diseases such as diabetes, certain respiratory diseases and dementia are also near the top of the list.

In the past, infectious diseases played a bigger part than they do today. In 1990, one in three deaths resulted from communicable and infectious diseases; by 2017 this had fallen to one in five. Children are particularly vulnerable to infectious diseases. As recently as the 19th Century, every third child in the world died before the age of five. Child mortality rates have fallen significantly since then thanks to vaccines and improvements in hygiene, nutrition, healthcare and clean water access. Child deaths in rich countries are now relatively rare, while the poorest regions today have child mortality rates similar to the UK and Sweden in the first half of the 20th Century, and are continuing to catch up.

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Impossible choices.

Arctic Animals Shift Feeding Habits (AFP)

Seals and whales in the Arctic are shifting their feeding patterns as climate change alters their habitats, and the way they do so may determine whether they survive, a new study has found. Researchers harnessed datasets spanning two decades to examine how two species of Arctic wildlife – beluga whales, also known as white whales, and ringed seals – are adapting to their changing homes. Both species traditionally hunt for food in areas with sea ice and particularly at so-called tidal glacier fronts, where glaciers meet the ocean. But with climate change melting sea ice and prompting glaciers to retreat, researchers in Norway decided to look at whether and how animals in the affected areas were adapting.

“The Arctic is the bellwether of climate change,” the researchers wrote. “With the rapid pace of change rendering genetic adaptation unfeasible,” they reasoned that behavioural and dietary changes “will likely be the first observable responses within ecosystems”. [..] For the seals, they compared tracker data from 28 individuals between 1996-2003 and then 2010-2016, and for the whales they looked at data from 18 animals between 1995-2001 and 16 animals from 2013-2016. The data showed that two decades ago, both species spent around half their time foraging at glacier fronts and eating a diet dominated by polar cod. But ringed seals now spend “significantly higher proportions of time near tidal glacier fronts” while the white whales had the opposite response and had moved elsewhere to look for food.

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Feb 142019
 


Pablo Picasso Guitar 1925

 

Australia’s $7 Trillion Question: How Low Will House Prices Go (SMH)
US Mortgage Applications Drop Despite Lower Rates: Industry is Baffled (WS)
Surge In Delinquencies Threatens US Auto Loan Bubble (Colombo)
$1 Trillion Amazon Pays $0 In Income Taxes, Gets $129 Million Rebate (RT)
EU Officials: UK Only ‘Pretending To Negotiate’ Over Brexit (G.)
UK Has Rolled Over Just £16bn Out Of £117bn Trade Deals (G.)
Labour MPs Warn Corbyn: Back A Second Referendum Or We Quit (G.)
Hardline Brexiters Threaten To Vote Down Theresa May’s Motion (G.)
Maduro Claims Foes ‘Totally Failed’ To Topple Him As Efforts Falter (G.)
Venezuela Envoy Elliott Abrams Loses His Cool In Congress (ZH)
Germany Pulls Rank on Macron and Washington over Nordstream 2 (SCF)
Bikes Put Spanner In Works Of Dutch Driverless Car Schemes (G.)
Exposure To Glyphosate Increases Risk Of Cancer By 41% – Study (G.)

 

 

As I said yesterday, after 27 years without a recession, the no. 1 instrument to battle complacency, excesses and zombies, Australia is a fire hazard. At the same time, of course, after 27 years so many people have never seen a recession that nobody expects one anymore.

Australia’s $7 Trillion Question: How Low Will House Prices Go (SMH)

Industry experts say property prices in Sydney and Melbourne, which have led a slump in Australia’s $7 trillion residential property market, are likely headed lower before they hit rock bottom. The Australian Bureau of Statistics released figures this week showing new lending to owner occupiers fell 6.4% during December last year, outpacing the fall in lending to property investors, which dropped by 4.6%. The total value of new lending to households has now dropped 19.8% in the past year — the biggest annual fall in home loans since the height of the global financial crisis. “The lending numbers are atrocious; it tells us that property markets in Sydney and Melbourne are in a tailspin,” says Louis Christopher, managing director of property researcher SQM Research.

The issue is mostly access to credit and, for at least for past six months, banks have been scrutinising the spending of borrowers more closely when assessing their loans, Christopher says. Doron Peleg, chief executive of RiskWise Property Research, says the weak lending figures also show how those who would normally be entering the property market are now shying away in anticipation of lower prices. The Westpac-Melbourne Institute Index out this week showed consumers in Sydney and Melbourne have poor property price expectations. “Buyer sentiment has been hit as residential property, particularly in Sydney and Melbourne, is seen as a depreciating asset,” Peleg says.

[..] Many property experts are expecting a peak-to-trough drop in property prices of between 15% and 20%. “Without an interest-rate cut or regulatory changes there will be tough times ahead for the property market,” RiskWise’s Peleg says. [..] Tim Lawless, the head of research at property researcher CoreLogic, is expecting a peak-to-trough fall of up to 20% for both Sydney and Melbourne before prices start to level out in 2020. However, Lawless says the price declines should be kept in perspective. Sydney house and apartment prices have risen by more than 70% in the past decade, while Melbourne prices have gained even more, he says. This is despite recent price falls of more than 12% from their peak in Sydney in mid-2017 and 8% in Melbourne from a top in late 2017, he says.

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The Omen.

US Mortgage Applications Drop Despite Lower Rates: Industry is Baffled (WS)

A month ago, mortgages reappeared in the housing-hype circus, when it was widely reported that mortgage applications “soared” and “jumped.” Both types of mortgage applications did so: those used to purchase a home (purchase mortgages) and those used to refinance an existing mortgage (refinance mortgages). The jump in mortgage applications was ascribed to “plunging” mortgage interest rates. It was seen as a big sign that the weakening housing market was about to turn around. But that hope has gotten unwound.

Today, the Mortgage Bankers Association (MBA) reported that its purchase mortgage index – which tracks applications (not approvals) for conventional and government mortgages to purchase a single-family house – fell 6% from the prior week and was down 5% from the same week last year – despite falling mortgage rates, which should have cranked up home buying and mortgage activity. It was the fourth week in a row of drops:

The Purchase Mortgage Index is considered a reliable indicator of impending home sales, and so this decline, given the lower mortgage rates, mystifies the industry.“Application activity fell last week – even with rates decreasing – as renewed uncertainty about the domestic and global economy likely held potential homebuyers off the market,” said MBA Associate VP of Industry Surveys and Forecasts, Joel Kan, in the report. “The 30-year fixed-rate mortgage dropped to its lowest level since last March, and was 52 basis points lower than its recent high last November,” he said.

You can practically hear between the lines, so to speak, the bafflement in his voice about this decline in purchase mortgage applications in light of the decline in mortgage rates. The MBA also reported today that the average interest rate for 30-year fixed-rate mortgages with conforming loan balances inched down to 4.65%, back where it had been last April (chart via Investing.com):

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AKA the Thelma and Louise economy.

Surge In Delinquencies Threatens US Auto Loan Bubble (Colombo)

My concerns about the U.S. automobile bubble are being confirmed. As Bloomberg reports: “More Americans than ever are at least three months behind on their auto loans, a sign that the U.S. economy may have little growth left in the tank. The number of loans at least 90 days late exceeded 7 million at the end of last year, the highest total in the two decades the Federal Reserve Bank of New York has kept track. Expressed as a percentage of total debt, the delinquency rate is the highest since 2012, as overall borrowing has also increased.

The data show not all Americans are benefiting from the strong labor market, New York Fed economists say. Consumers with the weakest credit have driven deteriorating performance of auto debt: The share of subprime borrowers who fell well behind on car payments the last three months of the year was the highest since the second quarter of 2010.

As I’ve been warning for the past couple years, the U.S. automobile sales boom is a byproduct of a bubble in auto loans:

The auto sales and auto loan bubble is a byproduct of ultra-cheap credit conditions in the past decade since the Great Recession. Interest rates are now rising, which threatens the auto bubble: It’s only a matter of time before the U.S. auto sales and loan bubble experiences a serious bust. Rising delinquencies are just the start, I’m afraid. Booms fueled by cheap credit always end the same way – in a terrible bust. Ignore the voices that say “this time will be different!”

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And the people who lost their retail jobs don’t pay income taxes either anymore.

$1 Trillion Amazon Pays $0 In Income Taxes, Gets $129 Million Rebate (RT)

Trillion-dollar-company Amazon skated through 2018’s tax filings without paying a cent for the second year in a row. The e-commerce behemoth, which made $11 billion last year, will pay no taxes at all, thanks to 2017’s tax reform. Rather than pay the standard 21% corporate income tax rate, Amazon is actually claiming a tax rebate of $129 million, which works out to a logic-defying rate of -1%. Aside from the nebulous “tax credits,” which the company does not have to spell out in its public filings, Amazon is also claiming a tax break for executive stock options, according to the Institute for Taxation and Economic Policy – a longstanding loophole that permits profitable corporations to dodge federal and state income taxes on almost half their profits.

While President Donald Trump’s 2017 tax reform legislation lowered corporate tax rates from 35% to 21%, it was sold as an incentive for companies to keep their money in the US, instead of stashing it overseas where the IRS couldn’t touch it. Now that Amazon and Netflix have both made headlines for using the new regulations to avoid paying anything at all, it remains to be seen whether the legislation’s failure to close corporate loopholes will leave the US holding the bag for fiscal year 2018 as the country’s national debt inches past $22 trillion – a record high.

Amazon’s tax windfall doesn’t even take into account the billions in tax breaks the state governments of Virginia and New York offered the company to open a second (and third) headquarters in their states, though there are rumors that New York is getting cold feet about the unprecedented corporate giveaway. Amazon didn’t pay any taxes in 2017 either, though it raked in a comparatively paltry $5.6 billion in profits and extracted a slightly larger $137 million refund.

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“Verhofstadt asked Lidington four times what the British proposal was and “four times didn’t get an answer”, according to the EU official, who described the encounter as “very surreal”.”

EU Officials: UK Only ‘Pretending To Negotiate’ Over Brexit (G.)

The British government is “pretending to negotiate” with the European Union and has not presented any new proposals to break the Brexit deadlock, according to EU officials. Theresa May’s de-facto deputy, David Lidington, and the Brexit secretary, Stephen Barclay, met senior EU officials and MEPs in Brussels and Strasbourg this week, but the talks yielded no obvious results. The British side thinks a crucial process has begun and hopes progress will have been made by 27 February when MPs are expected to have another crunch Brexit vote. However, on Wednesday night European council president Donald Tusk said the EU27 was still waiting for proposals. “No news is not always good news,” he tweeted, after meeting with the EU’s chief negotiator Michel Barnier.

“EU27 still waiting for concrete, realistic proposals from London on how to break Brexit impasse,” Tusk said. Barnier, has said current talks with the UK do not even qualify as negotiations. In a call on Tuesday morning with Guy Verhofstadt, chief Brexit representative for the European parliament, Barnier said there were “no negotiations” with the British. “These are courtesy calls at best and we have nothing new to say,” Barnier was reported to have said, by a source familiar with the conversation. Verhofstadt had asked the EU negotiator for an update, following Barnier’s meeting with Barclay over dinner at the British ambassador’s residence in Brussels, where they dined on North Sea sole, roast duck and British cheese, washed down with sancerre and saint-émilion wines.

“They are pretending to negotiate while they still don’t know what they want and how they want it,” the source said, who described this week’s meetings as “kicking up dust” and a series of “photo opportunities and pictures”. “We are willing to negotiate, but there is nothing on the table from the British side.” Verhofstadt asked Lidington four times what the British proposal was and “four times didn’t get an answer”, according to the EU official, who described the encounter as “very surreal”.

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Don’t be so negative: they got a hard-fought deal with the Seychelles!

UK Has Rolled Over Just £16bn Out Of £117bn Trade Deals (G.)

The government’s push to roll over EU trade deals from which the UK currently benefits has yielded agreements covering only £16bn of the near-£117bn of British trade with the countries involved. Despite frenetic efforts by ministers to ensure the continuity of international trade after the UK leaves the EU on 29 March, the international trade secretary, Liam Fox, has so far only managed to secure deals with seven of the 69 countries that the UK currently trades with under preferential EU free trade agreements, which will end after Brexit.

Fox’s department has yet to sign agreements with several major UK trading partners – including Canada, Japan, South Korea and Turkey – while sources have said that sufficient progress is unlikely to be made before the Brexit deadline in less than 50 days’ time. Canada, Japan, South Korea and Turkey alone accounted for goods exports worth £25bn in 2017 and imports of merchandise worth £28.6bn, with the UK currently able to access these markets on preferential terms as part of membership of the EU. Fox sought to downplay the significance of the deals in parliament on Wednesday, saying all of the countries involved only accounted for about 11% of total UK trade in 2018, with the smallest 20 nations worth less than 0.8%.

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I’ve been wondering why any politician in Britain is still in their jobs.

Labour MPs Warn Corbyn: Back A Second Referendum Or We Quit (G.)

Jeremy Corbyn faces up to 10 resignations from the Labour frontbench if he fails to throw his party’s weight behind a fresh attempt to force Theresa May to submit her Brexit deal to a referendum in a fortnight’s time, frustrated MPs are warning. With tension mounting among anti-Brexit Labour MPs and grassroots members, several junior shadow ministers have told the Guardian they are prepared to resign their posts if Corbyn doesn’t whip his MPs to vote for a pro-referendum amendment at the end of the month. Corbyn has been struggling to balance the conflicting forces in his party over Brexit, as the clock ticks down towards exit day on 29 March..

Many party members and MPs would like him to take a lead in seeking to block Brexit before time runs out – but some frontbenchers are equally adamant they could never support a referendum. Len McCluskey, the general secretary of the Unite union and a close ally of Corbyn, risked stoking the conflict in the party on Wednesday when he argued that stopping Brexit was “not the best option for our nation”. “My view is that, having had a 2016 referendum where the people have voted to come out of the EU, to try and deflect away from that threatens the whole democratic fabric on which we operate,” he told Peston on ITV. “I’m saying that in reality it is not the best option for our nation.”

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43 days. Both extremities, hard brexit and 2nd referendum, think they have a chance of winning it all.

Hardline Brexiters Threaten To Vote Down Theresa May’s Motion (G.)

Hardline Brexit supporters are threatening to inflict yet another Commons defeat on Theresa May because they fear the government is effectively ruling out leaving the EU with no deal. Members of the Tory European Research Group are unhappy with the wording of a No 10 motion because it endorses parliament’s vote against any Brexit without a withdrawal agreement. The motion for debate on Thursday simply affirms “the approach to leaving the EU” backed by the Commons on 29 January, when an amendment was passed in favour of an attempt to replace the Northern Ireland backstop with “alternative arrangements”.

The motion was thought to be fairly uncontroversial until pro-Brexit supporters realised it also encompassed a second amendment passed on that day, which ruled out a no-deal Brexit. The amendment, tabled by Dame Caroline Spelman, “rejects the United Kingdom leaving the European Union without a withdrawal agreement and a framework for the future relationship”. The ERG group, led by arch-Brexiter Jacob Rees-Mogg, is planning either to vote against or abstain on Thursday’s government motion, potentially causing another embarrassing parliamentary loss for the prime minister. However, talks with government whips will continue on Thursday in an attempt to find a compromise.

An ERG MP said many of its members were “not minded to support such a clumsily worded motion” that effectively ruled out a no-deal Brexit. Another said the group would not trust verbal assurances from No 10 that no deal was still on the table as such promises from the dispatch box had not been honoured many times in the past.

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How far away is a false flag?

Maduro Claims Foes ‘Totally Failed’ To Topple Him As Efforts Falter (G.)

Venezuela’s embattled leader, Nicolás Maduro, has claimed he has seen off a dramatic opposition challenge to his rule, as those efforts appeared to falter and the United States conceded it was “impossible to predict” how long he might remain in power. In an interview with Euronews, Maduro boasted that his political foes had “failed totally” in their quest to topple him. Opponents “could march every single day of their lives” and achieve nothing, Maduro said. Venezuela’s newly emboldened opposition continues to insist Maduro’s days are numbered, with about 50 governments now recognizing its leader, Juan Guaidó, as the country’s legitimate president.

Tens of thousands of supporters poured back on to the streets of Caracas and other major cities on Tuesday to demand the resignation of a politician they accuse of leading their oil-rich country into economic ruin. But three weeks after Guaidó electrified the previously rudderless opposition movement by declaring himself interim leader, there are signs his campaign risks losing steam. An anticipated mass defection of military chiefs – which opposition leaders admit is a prerequisite to Maduro’s departure – has not materialized, and Maduro’s inner-circle has begun claiming it has weathered the political storm. “In the end, nothing will come of [this challenge]. We will prevail,” Maduro’s second-in-command, Diosdado Cabello, tweeted on Wednesday.

[..] Opposition leaders have spent recent days trying to dampen expectations that Maduro’s exit is imminent. Juan Andrés Mejía, an opposition leader and Guaidó ally, admitted that goal “could take some time”. “We want it to end very soon because we know that every day that passes by people are suffering. But Maduro still has control of the military and basically that is the reason we haven’t been able to move things forward,” he told the Guardian.

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Shaking up US politics since 2016. And c’mon, Abrams is a war criminal, he should be facing a court, not Congress.

Venezuela Envoy Elliott Abrams Loses His Cool In Congress (ZH)

Rep. Ilhan Omar clashed with newly minted Venezuela Envoy Elliott Abrams during a Wednesday hearing in front of the House Foreign Relations Committee discussing the role of the US military in Central America. “Mr. Abrams, in 1991 you pleaded guilty to two counts of withholding information from Congress regarding your involvement in the Iran-Contra affair, for which you were later pardoned by president George H.W. Bush,” began Omar. “I fail to understand why members of this committee or the American people should find any testimony that you give today to be truthful.” “If I could respond to that…” interjected Abrams. “It was not a question,” shot back Omar.

After a brief exchange in which Abrams protested “It was not right!” Omar cut Abrams off, saying “Thank you for your participation.” Omar: “On February 8, 1982, you testified before the Senate foreign relations committee about US policy in El Salvador. In that hearing you dismissed as communist propaganda, a report about the massacre of El Mozote in which more than 800 civilians – including children as young as two-years old – were brutally murdered by US-trained troops. During that massacre, some of those troops bragged about raping 12-year-old girls before they killed them. You later said that the US policy in El Salvador was a “fabulous achievement.” “Yes or no – do you still think so?” asked Omar.

Abrams replied: “From, the day that Duarte was elected in a free election, to this day, El Salvador has been a democracy. That’s a fabulous achievement.” Omar shot back: “Yes or no, do you think that massacre was a fabulous achievement that happened under our watch?” Abrams protested: “That is a ridiculous question- to which Omar shot back, “Yes or no,” cutting him off. “Yes or no, would you support an armed faction within Venezuela that engages in war crimes, crimes against humanity or genocide, if you believe they were serving US interests as you did in Guatemala, El Salvador and Nicaragua?” “I am not going to respond to that question, I’m sorry. I don’t think this entire line of questioning is meant to be real questions, and so I will not reply.” said Abrams.

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US accuses Russia of energy blackmail, tries to blackmail Germany. Germans will never accept not being independent when it comes to energy. Moreover, their economy is teetering.

Germany Pulls Rank on Macron and Washington over Nordstream 2 (SCF)

It was billed politely as a Franco-German “compromise” when the EU balked at adopting a Gas Directive which would have undermined the Nord Stream 2 project with Russia. Nevertheless, diplomatic rhetoric aside, Berlin’s blocking last week of a bid by French President Emmanuel Macron to impose tougher regulations on the Nord Stream 2 gas project was without doubt a firm rebuff to Paris. Macron wanted to give the EU administration in Brussels greater control over the new pipeline running from Russia to Germany. But in the end the so-called “compromise” was a rejection of Macron’s proposal, reaffirming Germany in the lead role of implementing the Nord Stream 2 route, along with Russia. The $11-billion, 1,200 kilometer pipeline is due to become operational at the end of this year.

Stretching from Russian mainland under the Baltic Sea, it will double the natural gas supply from Russia to Germany. The Berlin government and German industry view the project as a vital boost to the country’s ever-robust economy. Gas supplies will also be distributed from Germany to other European states. Consumers stand to gain from lower prices for heating homes and businesses. Thus Macron’s belated bizarre meddling was rebuffed by Berlin. A rebuff was given too to the stepped-up pressure from Washington for the Nord Stream 2 project to be cancelled. Last week, US ambassador to Germany Richard Grenell and two other American envoys wrote an op-ed for Deutsche Welle in which they accused Russia of trying to use “energy blackmail” over Europe’s geopolitics.

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Why on earth is that government pushing driverless cars?

Bikes Put Spanner In Works Of Dutch Driverless Car Schemes (G.)

The Dutch government is working with Germany and Belgium on establishing “truck platooning” – where one human-driven vehicle leads a convoy of autonomous ones — on major roads. Under the plans, about 100 driverless trucks would drive the “Tulip corridors” at night – from Amsterdam to Antwerp, and from Rotterdam to the Ruhr valley – fully maximising the routes through which the Netherlands distributes its goods using 5G technology and 1,200 smart traffic lights. The Dutch infrastructure minister, Cora van Nieuwenhuizen, has announced a “driving licence” for self-driving cars, through which it would certify new autonomous models, and a framework of legislation – known as the Experimenteerwet zelfrijdende auto’s – is being prepared.

But a report by the professional service company KPMG highlights a major problem for Dutch ministers in introducing the technology to urban centres, where the bicycle is increasingly king. Driverless cars detect other road users using a variety of cameras or laser-sensing systems to ensure that they stop if an object is detected in their path. But the varying sizes and agility of cyclists, with their sudden changes in speed and loose adherence to the rules of the road, present a major challenge to the existing technology. That challenge is particularly stark in the Netherlands, where 17 million people own 22.5m bicycles. More than a quarter of all trips made by Dutch residents are by bike. Of all trips of a distance of up to five miles, a third are made by bicycle, with the rate only dropping to 15% for trips up to 10 miles in length.

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Is it that hard to understand that pesticides and herbicides are the worst idea ever? Poison kills, cut it out.

Exposure To Glyphosate Increases Risk Of Cancer By 41% – Study (G.)

A broad new scientific analysis of the cancer-causing potential of glyphosate herbicides, the most widely used weed killing products in the world, has found that people with high exposures to the popular pesticides have a 41% increased risk of developing a type of cancer called non-Hodgkin lymphoma. The evidence “supports a compelling link” between exposures to glyphosate-based herbicides and increased risk for non-Hodgkin lymphoma (NHL), the authors concluded, though they said the specific numerical risk estimates should be interpreted with caution. The findings by five US scientists contradict the US Environmental Protection Agency’s (EPA) assurances of safety over the weed killer and come as regulators in several countries consider limiting the use of glyphosate-based products in farming.

Monsanto and its German owner Bayer face more than 9,000 lawsuits in the US brought by people suffering from NHL who blame Monsanto’s glyphosate-based herbicides for their diseases. The first plaintiff to go to trial won a unanimous jury verdict against Monsanto in August, a verdict the company is appealing. The next trial, involving a separate plaintiff, is set to begin on 25 February , and several more trials are set for this year and into 2020. Monsanto maintains there is no legitimate scientific research showing a definitive association between glyphosate and NHL or any type of cancer. Company officials say the EPA’s finding that glyphosate is “not likely” to cause cancer is backed by hundreds of studies finding no such connection.

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