Feb 272019
 
 February 27, 2019  Posted by at 10:36 am Finance Tagged with: , , , , , , , , , , , , ,  


Salvador Dali Remorse – Sphinx Embedded in the Sand 1931

 

Michael Cohen Testimony: Trump A ‘Racist’, ‘Cheat’ And ‘Conman’ (G.)
3 Days That Will Decide Brexit – March 12-14th Will Seal Britain’s Fate (Exp.)
UK Economy Could Be 9% Weaker Under No-Deal Brexit – Government (G.)
The UK Doesn’t Have The Right Pallets For Exporting To The EU (BI)
The War on Venezuela is Built on Lies (Pilger)
Survival of the Richest (Nomi Prins)
Hey Yellen, It Was Trump Who Was Right (Every)
Now that Housing Bubble #2 Is Bursting…How Low Will It Go? (CHS)
Russia’s Share Of European Gas Market Surges To Almost 37%, Dwarfing LNG (RT)
UK Hunger Survey To Measure Food Insecurity (G.)
Glyphosate Found In 95% Of Wine And Beer (Ind.)
Am I The Only One Who’s Terrified About The Warm Weather? (G.)

 

 

Lots of wet panties, male and female, today in anticipation of Michael Cohen’s testimony. Of course, it’s been leaked, full text is here. A few quotes:

I may once again be in a party of one, but I think it’s awfully weak, it’s grasping for stuff rather than conveying it. First, there’s the inevitable Assange link:

In July 2016 [..] Mr. Stone told Mr. Trump that he had just gotten off the phone with Julian Assange and that Mr. Assange told Mr. Stone that, within a couple of days, there would be a massive dump of emails that would damage Hillary Clinton’s campaign. Mr. Trump responded by stating to the effect of “wouldn’t that be great.”

Anything related to Assange, whether from Mueller or Cohen, lacks credibility as long as he can’t defend himself against it. And Trump merely says: wouldn’t that be great? Not exactly the stuff of collusion or conspiracy.

Just as inevitable in smear campaigns: Trump the racist.

Mr. Trump is a racist. The country has seen Mr. Trump court white supremacists and bigots. You have heard him call poorer countries “shitholes.” While we were once driving through a struggling neighborhood in Chicago, he commented that only black people could live that way. And, he told me that black people would never vote for him because they were too stupid.

Calling a country a shithole is not racist. The policies that have created a situation in which many shithole countries are populated by black people stem from many decades of US/Europe policies that predate Trump. The rest is not racist either, if you look closer. Perhaps Trump is a bit racist, like so many Americans. But Cohen’s prepared words don’t show that.

Also: Trump doesn’t tell the full truth about his wealth. But Michael Cohen always has…

It was my experience that Mr. Trump inflated his total assets when it served his purposes, such as trying to be listed among the wealthiest people in Forbes, and deflated his assets to reduce his real estate taxes.

Gee, lock him up. I don’t get it. There’s so much wrong with Trump, but politics and media have singled out Russia collusion, and then failed to prove a thing about it, and now they switch to ‘racist conman’, with the weakest of accusations. I swear, they might as well all be working for the Donald.

Michael Cohen Testimony: Trump A ‘Racist’, ‘Cheat’ And ‘Conman’ (G.)

Michael Cohen is to accuse Donald Trump of being a “conman” and a “cheat” who had advanced knowledge that a longtime adviser was communicating with WikiLeaks during the 2016 campaign, according to opening testimony he will deliver to Congress on Wednesday. Cohen’s prepared remarks, confirmed by the Guardian, include a series of explosive allegations about the presidential campaign. The president’s former lawyer, who will publicly testify before the House oversight committee on Wednesday, will state that Trump was told by Roger Stone that WikiLeaks would publish emails stolen from the Democratic National Committee and Hillary Clinton’s campaign.

“In July 2016, days before the Democratic convention, I was in Mr Trump’s office when his secretary announced that Roger Stone was on the phone. Mr Trump put Mr Stone on the speakerphone,” Cohen’s opening statement reads. “Mr Stone told Mr Trump that he had just gotten off the phone with Julian Assange and that Mr Assange told Mr Stone that, within a couple of days, there would be a massive dump of emails that would damage Hillary Clinton’s campaign. Mr Trump responded by stating to the effect of ‘wouldn’t that be great.’” The remarkable allegations by Cohen go further than what has been made public thus far by the special counsel investigation into potential collusion between the Trump campaign in Moscow.

Cohen will also suggest his instructions to lie to Congress about a possible Trump Tower deal in Moscow during the 2016 campaign came from the president – albeit not directly. “In conversations we had during the campaign, at the same time I was actively negotiating in Russia for him, he would look me in the eye and tell me there’s no business in Russia and then go out and lie to the American people by saying the same thing,” Cohen will say. “In his way, he was telling me to lie.” “Mr Trump did not directly tell me to lie to Congress. That’s not how he operates,” he will add.

Read more …

Humor me and please read this. It’s so confusing that you almost forget it’s also complete madness.

3 Days That Will Decide Brexit – March 12-14th Will Seal Britain’s Fate (Exp.)

In a dramatic statement to the House of Commons, Mrs May confirmed that she will put her Withdrawal Agreement – including whatever additional assurances she has secured from Brussels – to a “meaningful vote” by March 12. If that fails, MPs will be offered two separate votes the following day – one on a no-deal Brexit, and the other on requesting an extension to the two-year Article 50 negotiation process to delay EU withdrawal beyond March 29. The sequence of votes will be proposed in an amendable motion tabled by the Prime Minister for debate and vote in the Commons on Wednesday. To uproar in the Commons, Mrs May told MPs: “They are commitments I am making as Prime Minister and I will stick by them, as I have previous commitments to make statements and table amendable motions by specific dates.”

Deputy Political Editor for Sky News Beth Rigby tweeted of Mrs May’s speech: “This really is a big shift. “May has finally played her cards and sided with the Europhile wing of her party .. “Vote for her deal (March 12) Vote for no-deal (March 13) Vote for delay (March 14) .. “Only yesterday she refused to even acknowledge there might have to be a delay to Brexit.”

Mrs May has declared a meaningful vote will take place by March 12, where MPs will vote on her Brexit deal. Should this deal not be voted through, on March 13, MPs will then be offered two separate votes by March 13 on whether the UK leaves with no deal or delays Brexit beyond March 29. The delay will then be voted on March 14, when a motion would be brought forward on whether Parliament wishes to seek a short limited extension to Article 50. If the House votes for an extension, this extension will have to be approved by the House with the EU and then necessary legislation will be brought forward to change the exit date.

[..] In her statement to MPs following a Cabinet meeting with senior colleagues at 10 Downing Street, Theresa May said she wanted to set out “three further commitments” to the Commons. She said: “First, we will hold a second meaningful vote by Tuesday, March 12 at the latest. “Second, if the Government has not won a meaningful vote by Tuesday, March 12, then it will – in addition to its obligations to table a neutral amendable motion under Section 13 of the EU Withdrawal Act – table a motion to be voted on by Wednesday March 13 at the latest, asking this House if it supports leaving the EU without a Withdrawal Agreement and a framework for a future relationship on March 29.

“So the United Kingdom will only leave without a deal on March 29 if there is explicit consent in the House for that outcome. “Third, if the House, having rejected the deal negotiated with the EU, then rejects leaving on March 29 without a Withdrawal Agreement and future framework, the Government will on March 14 bring forward a motion on whether Parliament wants to seek a short, limited extension to Article 50.” The Prime Minister also said she still believes she will be able to secure a deal: “I’ve had a real sense from the meetings I’ve had, and the conversations I’ve had in recent days, that we can achieve that deal. “It’s within our grasp to leave with a deal on March 29 and that’s where all of my energies are going to be focused.”

Read more …

Scared yet? Because that’s the idea.

UK Economy Could Be 9% Weaker Under No-Deal Brexit – Government (G.)

The government has issued a bleak warning over a no-deal Brexit, estimating the UK economy could be 9% weaker in the long run, businesses in Northern Ireland might go bust and food prices will increase. In an official document only published after repeated demands by the former Conservative MP Anna Soubry, the government also revealed it was behind on contingency planning for a third of “critical projects” in relation to business and trade. The latest no-deal notice states:

• The economy would be 6%-9% smaller over the next 15 years than it otherwise might have been, in the event of no deal, in line with Bank of England forecasts. • The flow of goods through Dover would be “very significantly reduced for months”. • With 30% of food coming from the EU, prices are likely to increase and there is a risk that panic buying might create shortages. • Only six of the 40 planned international trade agreements have been signed.

The document was published just hours after Theresa May was forced to promise two key votes, allowing MPs the option to reject no deal and to potentially delay Brexit for a short period, following pressure from remain-minded cabinet ministers. The prime minister set out a timetable that includes a vote on her Brexit deal by 12 March; if that fails, a vote the following day to support no deal, and if that also fails, a vote on 14 March on extending article 50. The delay is likely to further agitate the Tory party’s Eurosceptics, with Brexiter ministers including Andrea Leadsom and Liz Truss expressing their frustration over the issue in cabinet on Tuesday morning. Speaking in the House of Commons on Tuesday, May did not specify the length of any delay, saying only that she would prefer it to be the shortest possible. An extension beyond the end of June would involve the UK taking part in the European parliament elections.

[..] The no-deal notice said customs checks alone could cost businesses £13bn a year and that it was impossible to predict the impact of new tariffs. It said this was partly because the government’s communications to businesses and individuals about the need to prepare for no deal had not been effective. [..] The EU, which would treat the UK as a third country in the event of no deal, could impose tariffs of 70% on beef exports, 45% on lamb and 10% on cars, it said. “This would be compounded by the challenges of even modest reductions in flow at the border.”

Read more …

Absolutely fabulous.

The UK Doesn’t Have The Right Pallets For Exporting To The EU (BI)

The UK government is due to hold emergency talks with industry leaders on Tuesday after discovering that the country doesn’t have the right pallets to continue exporting goods to the European Union if it leaves without a deal next month. Under strict EU rules, pallets – wooden or plastic structures that companies use to transport large volumes of goods – arriving from non-member states must be heat-treated or cleaned to prevent contamination and have specific markings to confirm that they meet standards. Most pallets that British exporters are using do not conform to the rules for non-EU countries, or “third countries,” as EU member states follow a much more relaxed set of regulations.

The Department for Environment, Food, and Rural Affairs last week told business leaders that the UK would not have enough EU-approved pallets for exporting to the continent if it leaves without a withdrawal agreement next month. That means UK companies would be competing for a small number of pallets that meet EU rules, and those that miss out would be forced to wait for new pallets, which could take weeks to be ready. DEFRA has arranged for a conference call on Tuesday morning to discuss the pallet shortage, with 31 days until Brexit day on March 29. “It is the tiny, procedural, mundane-seeming stuff that will absolutely trip people up,” one industry figure briefed by Theresa May’s government told Business Insider, adding that the country was “not even remotely ready” for a no-deal Brexit.

Read more …

Chavez is the guy US intelligence have been chasing for so long, and still trying to get at after his death.

Got to love the man quoting world literature. Also because in the next article, Nomi Prins does the same.

The War on Venezuela is Built on Lies (Pilger)

Travelling with Hugo Chavez, I soon understood the threat of Venezuela. At a farming co-operative in Lara state, people waited patiently and with good humor in the heat. Jugs of water and melon juice were passed around. A guitar was played; a woman, Katarina, stood and sang with a husky contralto. “What did her words say?” I asked. “That we are proud,” was the reply. The applause for her merged with the arrival of Chavez. Under one arm he carried a satchel bursting with books. He wore his big red shirt and greeted people by name, stopping to listen. What struck me was his capacity to listen. But now he read. For almost two hours he read into the microphone from the stack of books beside him: Orwell, Dickens, Tolstoy, Zola, Hemingway, Chomsky, Neruda: a page here, a line or two there. People clapped and whistled as he moved from author to author.

Then farmers took the microphone and told him what they knew, and what they needed; one ancient face, carved it seemed from a nearby banyan, made a long, critical speech on the subject of irrigation; Chavez took notes. Wine is grown here, a dark Syrah type grape. “John, John, come up here,” said El Presidente, having watched me fall asleep in the heat and the depths of Oliver Twist. “He likes red wine,” Chavez told the cheering, whistling audience, and presented me with a bottle of “vino de la gente.” My few words in bad Spanish brought whistles and laughter. Watching Chavez with the people, la gente, made sense of a man who promised, on coming to power, that his every move would be subject to the will of the people. In eight years, Chavez won eight elections and referendums: a world record. He was electorally the most popular head of state in the Western Hemisphere, probably in the world.

Read more …

See? Like Pilger and Chavez, Nomi talks about literature. No space here to do this justice, please go read it. Key point: unlike the poor(er), the rich don’t live off the rewards of labor, but of that of wealth.

Survival of the Richest (Nomi Prins)

In George Orwell’s iconic 1945 novel, Animal Farm, the pigs who gain control in a rebellion against a human farmer eventually impose a dictatorship on the other animals on the basis of a single commandment: “All animals are equal, but some animals are more equal than others.” In terms of the American republic, the modern equivalent would be: “All citizens are equal, but the wealthy are so much more equal than anyone else (and plan to remain that way).” Certainly, inequality is the economic great wall between those with power and those without it. As the animals of Orwell’s farm grew ever less equal, so in the present moment in a country that still claims equal opportunity for its citizens, one in which three Americans now have as much wealth as the bottom half of society (160 million people), you could certainly say that we live in an increasingly Orwellian society.

Or perhaps an increasingly Twainian one. After all, Mark Twain and Charles Dudley Warner wrote a classic 1873 novel that put an unforgettable label on their moment and could do the same for ours. The Gilded Age: A Tale of Today depicted the greed and political corruption of post-Civil War America. Its title caught the spirit of what proved to be a long moment when the uber-rich came to dominate Washington and the rest of America. It was a period saturated with robber barons, professional grifters, and incomprehensibly wealthy banking magnates. (Anything sound familiar?) The main difference between that last century’s gilded moment and this one was that those robber barons built tangible things like railroads.

Today’s equivalent crew of the mega-wealthy build remarkably intangible things like tech and electronic platforms, while a grifter of a president opts for the only new infrastructure in sight, a great wall to nowhere. In Twain’s epoch, the U.S. was emerging from the Civil War. Opportunists were rising from the ashes of the nation’s battered soul. Land speculation, government lobbying, and shady deals soon converged to create an unequal society of the first order (at least until now). Soon after their novel came out, a series of recessions ravaged the country, followed by a 1907 financial panic in New York City caused by a speculator-led copper-market scam.

To fully grasp the nature of inequality in our twenty-first-century gilded age, it’s important to understand the difference between wealth and income and what kinds of inequality stem from each. Simply put, income is how much money you make in terms of paid work or any return on investments or assets (or other things you own that have the potential to change in value). Wealth is simply the gross accumulation of those very assets and any return or appreciation on them. The more wealth you have, the easier it is to have a higher annual income.

Read more …

Tyler got his hands on a piece by Michael Every at Dutch Rabobank.

Hey Yellen, It Was Trump Who Was Right (Every)

Rabo are already predicting a US recession in 2020, which will drag many down with it, and as the OECD now warns that swollen corporate debt piles, which central banks have so encouraged, is of ever lower quality and potentially more dangerous than it was back in 2008. 54% of investment grade bonds are now BBB-rated, up from 30% in 2008. The OECD argues “In the case of a downturn, highly leveraged companies would face difficulties in servicing their debt, which in turn, through higher default rates, may amplify the effects…Any developments in these areas will come at a time when non-financial companies in the next three years will have to pay back or refinance about USD4 trillion worth of corporate bonds. This is close to the total balance sheet of the US Federal Reserve.”

Guess what guys? China is right ahead of you on that curve – which is why it is trying to find another whale to nuke ASAP: things are looking truly ugly given many firms can’t even pay the interest on their debt, let alone the principle. And guess what else? That OECD and China warning sounds like an admission of the Minsky debt dynamic that you might have thought all central banks would have to have learned the lessons of post-GFC. Apparently not, however – because they think they already know everything. As former Fed Chair Yellen mocked yesterday, Trump doesn’t understand what the Fed’s dual mandates of price stability and stable employment are. That might well be true.

But was it the Fed or Trump who publicly called out how dangerous continuous Fed rate hikes are in a debt-laden, Minsky-teetering financial system where the yield curve is still inverted 9bps on 1s-5s even after a pause? I think Yellen will find it was Trump who was right and the Fed who was forced into a humiliating and frankly incongruous policy U-turn. So much expertise! Trump also made a similar intervention over oil prices overnight, and once again they dipped, though are opening up strongly this morning in Asia. [..] easy policy in the UK; ultra-easy policy in China; promises of more easing in Japan; an ECB U-turn to come(?); and the Fed on hold and stopping QT soon at least. And that’s with bullish markets and reasonable global growth – just wait until things head south: if all you have is a nuke, everything looks like a whale.

Read more …

Every bubble that bursts ends up below its starting level. Nicole had these graphs, Tulip, South Sea etc., that showed just that. This graph doesn’t quite do that.

Now that Housing Bubble #2 Is Bursting…How Low Will It Go? (CHS)

There are two generalities that can be applied to all asset bubbles: 1. Bubbles inflate for longer and reach higher levels than most pre-bubble analysts expected 2. All bubbles burst, despite mantra-like claims that “this time it’s different” The bubble burst tends to follow a symmetrical reversal of very similar time durations and magnitudes as the initial rise. If the bubble took four years to inflate and rose by X, the retrace tends to take about the same length of time and tends to retrace much or all of X. If we look at the chart of the Case-Shiller Housing Index below, this symmetry is visible in Housing Bubble #1 which skyrocketed from 2003-2007 and burst from 2008-2012.

Housing Bubble #1 wasn’t allowed to fully retrace the bubble, as the Federal Reserve lowered interest rates to near-zero in 2009 and bought $1+ trillion in sketchy mortgage-backed securities (MBS), essentially turning America’s mortgage market into a branch of the central bank and federal agency guarantors of mortgages (Fannie and Freddie, VA, FHA). These unprecedented measures stopped the bubble decline by instantly making millions of people who previously could not qualify for a privately originated mortgage qualified buyers. This vast expansion of the pool of buyers (expanded by a flood of buyers from China and other hot-money locales) drove sales and prices higher for six years (2012-2018).

As noted on the chart below, this suggests the bubble burst will likely run from 2019-2025, give or take a few quarters. The question is: what’s the likely magnitude of the decline? Scenario 1 (blue line) is a symmetrical repeat of Housing Bubble #2: a retrace of the majority of the bubble’s rise but not 100%, which reverses off this somewhat higher base to start Housing Bubble #3. Since the mainstream consensus denies the possibility that Housing Bubble #2 even exists (perish the thought that real estate prices could ever–gasp–drop), they most certainly deny the possibility that prices could retrace much of the gains since 2012.

More realistic analysts would probably agree that if the current slowdown (never say recession, it might cost you your job) gathers momentum, some decline in housing prices is possible. They would likely agree with Scenario 1 that any such decline would be modest and would simply set the stage for an even grander housing bubble #3. But there is a good case for Scenario 2, in which price plummets below the 2012 lows and keeps on going, ultimately retracing the entire housing bubble gains from 2003.

Read more …

Interesting how Europe smears Putin wherever it can, except where it counts.

Russia’s Share Of European Gas Market Surges To Almost 37%, Dwarfing LNG (RT)

Russia’s state-run energy major Gazprom said its share of sales of natural gas in the European Union has increased to 36.7 percent last year, rising over two percent against 34.2 percent in 2017. “In 2018, according to preliminary data, the share of gas supplies to the EU countries and Turkey has reached an all-time high and totaled 36.7 percent,” the director general of Gazprom Export Elena Burmistrova said at Gazprom’s Investor Day event, taking place in Singapore. Burmistrova added that Gazprom’s gas exports to Europe last year amounted to record 201.8 billion cubic meters, and is expected to significantly grow by 2035 due to the increasing demand.

According to a member of Gazprom’s management committee, Oleg Aksyutin, the company saw no threat to Gazprom’s business in the European market from global producers of liquefied natural gas (LNG), including the US. The company’s gas exports to Europe are reportedly three times more than the amount of LNG shipped to Europe by all global producers combined. Though the share of LNG shipments have been growing, it still makes up only 13 percent of the entire gas market, according to Burmistrova. The executive added that prices for natural gas saw a significant surge. “In 2018, in accordance with linked fuel prices, the average price of Gazprom gas increased by 24.6 percent to $245.5 for 1,000 cubic meters,” she said, stressing that in 2016 it stood at $167.

When it comes to China, one of the world’s biggest energy consumers, Gazprom is planning to become the country’s biggest supplier as soon as 2035, with the company’s share expected to reach 13 percent of Chinese overall consumption by the same year.

Read more …

It’s completely insane that any western country would have to do a Hunger Survey. Don’t fall for thinking it’s normal.

UK Hunger Survey To Measure Food Insecurity (G.)

The government is to introduce an official measure of how often low-income families across the UK skip meals or go hungry because they cannot afford to buy enough food, the Guardian can reveal. A national index of food insecurity is to be incorporated into an established UK-wide annual survey run by the Department for Work and Pensions (DWP) that monitors household incomes and living standards. Campaigners, who have been calling for the measure for three years, said the move was “a massive step forward” that would provide authoritative evidence of the extent and causes of hunger in the UK. They say food insecurity is strongly linked to poverty caused by austerity and welfare cuts and is driving widening health inequality.

Food insecurity is generally defined as experiencing hunger, the inability to secure food of sufficient quality and quantity to enable good health and participation in society, and cutting down on food because of a lack of money. The decision, which took campaigners by surprise, was revealed at an informal meeting on Tuesday attended by the DWP, the Office for National Statistics, Public Health England and the Scottish and Welsh governments, as well as a number of food poverty charities. Ministers have for years resisted calls to bring England into line with the US and Canada by measuring food insecurity. Critics said this was to avoid shedding unwanted light on the impact of welfare policy and the public health consequences of being unable to eat regularly or healthily.

Read more …

Why the hunger? Here’s why: we feed ourselves with plastics and poison.

Glyphosate Found In 95% Of Wine And Beer (Ind.)

A new study has shown that traces of a commonly-used and possibly cancerous weed killer can be found in the majority of wine and beer. Researches tested five wines and 15 beers from the US, Asia and Europe for traces of pesticide glyphosate. The research found that of the 20 samples, 19 (95 per cent) contained particles of the chemical, including products labelled as organic. The US Public Interest Research Group, which conducted the study, said the levels of the pesticide aren’t necessarily dangerous, but are still concerning. In 2015, the World Health Organisation’s International Agency categorised glyphosate as “probably carcinogenic to humans”, leading the state of California to add it to its list of chemicals that can cause cancer, which makes companies responsible for providing warnings to potential consumers.

The findings of the study coincide with the beginning of a class action lawsuit against Bayer, which acquired Monsanto last year. The suit claims that Roundup caused thousands of plaintiffs to develop non-Hodgkins lymphoma, a type of blood cancer. The first plaintiff, Ed Hardeman, testified this week, alleging that his use of the chemical on his 56 acres of land caused him to develop cancer aged 66. [..] Bayer has not commented on the results of the study, but the researchers are calling for glyphosate to be banned unless it can be proven safe.

Read more …

The earth’s weather system is far too complex to draw conclusions from a sunny day. The only things we can say about the climate must be based on long-term stats. This kind of article doesn’t help one bit, it merely points out the author literally doesn’t know what he’s talking about.

Am I The Only One Who’s Terrified About The Warm Weather? (G.)

They were everywhere in London on the weekend. The people in short sleeves or sandals. The ones with sunglasses ostentatiously hanging from the front of their shirts or balanced on top of their heads. The beer gardens and riverside pubs of the capital were heaving; corner shops ran out of ice-cream. Outside it was 17C (62F). Monday was another warm day, without a cloud in the sky, and in the late afternoon the light took on a magical, honey-coloured hue. It brought to mind one of those summer evenings you remember from childhood, when you’d be in the park all day and your parents let you stay out until bedtime, and you felt like you were doing something deliciously naughty just by being there.

Except it isn’t early summer: it’s February. And the entire developed world has not so much been doing something slightly naughty as systematically attacking the global ecosystem over a period of decades, and that’s how we go into this mess. We should try to hold on to this fact as young, posh men the nation over develop a strange delusion that anyone would want to see their elbows; this is not supposed to be happening. Less than a month ago, there was video footage of extreme cold weather coming out of Chicago. Forks supported in midair by suddenly frozen noodles, water poured from kettles instantly freezing on its way to the ground: you know the sort of thing.

OK, that was on the other side of the world, and was extreme and terrifying enough. But at least it was terrifying in the right direction. On Monday, though, the temperature hit 20.3C in Ceredigion, west Wales: the highest February temperature ever recorded in Britain and the first time the thermometer had breached 20C in winter. The BBC weather account tweeted it out with a gif of the sunshine icon and the same excitable breathlessness with which Springwatch would announce it had found a new type of vole. My response contained a single word, repeated seven times. It began with F.

Read more …

Mar 312016
 
 March 31, 2016  Posted by at 8:40 am Finance Tagged with: , , , , , , , , ,  


DPC Station at foot of incline, American Falls, Niagara Falls 1890

Americans Are Spending Again – But With Less Income (WSJ)
Britain Sacrifices Steel Industry To Curry Favour With China (AEP)
China Produced More Steel In 2 Years Than The UK Did Since 1870 (Conway)
China Ends This Quarter With The World’s Worst-Performing Stock Market (BBG)
China Investment Bank Defaults On ‘Dim Sum’ Bond (FT)
China’s Little Emperors Prop Up Aussie Housing Market (BBG)
China’s Largest Banks Post Lowest Annual Profit In A Decade (WSJ)
Saudi Aramco Expanding Oil and Gas Projects Even With Low Prices (BBG)
The World’s Largest Public Oil And Gas Companies (Rapier)
Bitcoin Technology’s Next Big Test: Trillion-Dollar Repo Market (WSJ)
Growth Of Fintech Forecast To Spur Almost 2 Million Banking Job Cuts (FT)
The Bribe Factory – How The West Corrupts The Middle East (SMH)
Pathocracy: The Rise Of The Political Psychopath (Whitehead)
Russia Vows ‘Totally Asymmetrical’ Response To US Troop Build-Up In Europe (RT)
Sea Levels Set To ‘Rise Far More Rapidly Than Expected’
Europe Is Too Important To Be Left To Its Clueless Rulers – Varoufakis (Tel.)
Refugees Run For Rio Olympic Dream Team (AFP)
Austria To Tighten Asylum Rules (P.)
Refugee Arrivals To Greece Rise Sharply Despite EU-Turkey Deal (Reuters)

There’s one way left only in which spending today can increase: debt must increase too: “..in 2004, a typical household in the lower third had $1,500 left over after expenses. By 2014, such households were $2,300 in the red.”

Americans Are Spending Again – But With Less Income (WSJ)

U.S. household spending has fully recovered since the latest recession, but income hasn’t, squeezing budgets and pushing many lower-income families into the red, according to a Pew Charitable Trusts report out Wednesday. “The lack of financial flexibility threatens low-income households’ financial security in the short term and their economic mobility in the long term,” the report said. Pew tracked inflation-adjusted expenditures and incomes of working-age Americans, ages 20 to 60, from 1996 to 2014. The results show the downturn and recovery for spending in the aftermath of the 2007-09 recession but also highlight stagnating incomes (including wages, government benefits and transfers, pensions, child support and other sources).

The study helps illustrate broader economic themes, including a slow recovery underpinned by steady job creation and rising consumer spending, alongside paltry wage growth and growing income inequality. Pew found that as of 2014, median income before taxes had fallen by 13% from a decade earlier, while expenditures had increased by nearly 14%. That left families across the income spectrum with fewer funds for savings and investment in things like education. Housing, transportation and food drove much of the rise in spending, leaving families with less financial wiggle room. Low-income families may not see much of an alternative to spending more on shelter, commuting costs and putting food on the table. Indeed, rent is now eating up nearly half of the income of low-income families, Pew found.

“That increase in the cost for shelter is a really important piece about why families at the bottom don’t feel financially stable,” said Erin Currier, director of the financial security and mobility project at Pew. “So many families are walking a financial tightrope—their core needs are getting more expensive and incomes aren’t rising to meet those costs.” That’s left many running a personal budget deficit despite spending less on restaurants, entertainment and other discretionary goods and services. Pew’s analysis found that in 2004, a typical household in the lower third had $1,500 left over after expenses. By 2014, such households were $2,300 in the red.

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Cameron has to save face now because of the publicity on the topic.

Britain Sacrifices Steel Industry To Curry Favour With China (AEP)

Britain’s special relationship with China is becoming more expensive by the day. It now threatens to destroy the British steel industry, a foundation pillar of our manufacturing economy. Britain is not alone. Most of Europe’s steel foundries are heading for annihilation under the current EU trade regime, with unthinkable consequences through the network of European and British supply chains. It is hard to pin down the exact moment when George Osborne’s love affair with China turned into a Faustian Pact. What we know is that the British government has for the last three years been blocking efforts by the EU to equip itself with the sort of anti-dumping weaponry used by Washington to confront China. The EU trade directorate has been rendered toothless by a British veto. So much for the canard that the UK has no influence in Brussels.

“The British are sacrificing an entire European industry to say thank you to China for signing up to the nuclear power project at Hinkley Point, and pretending it is about free trade,” said one official in Brussels bitterly. What they are blocking is a change to an EU regulation intended to beef up Europe’s ‘trade defence instruments’ (TDI), enabling it to respond much more quickly to Chinese dumping and too impose much tougher penalties. The British have cobbled together a blocking minority in the council, much to the annoyance of the French, Italians, Spanish, and Germans. The UK view is that the Commission mixed up good changes with bad changes, and that punitive tariffs merely hurt your own consumers, so you shoot yourself in the foot.

Yet the outcome is that it still takes Brussels 16 months to crank up full sanctions, twice as long as it takes the US. It is why the EU limits itself to a ‘Lesser Duty’ regime that often fails to reflects the full injury. While Washington has slapped penalties of 267pc on Chinese cold-rolled steel, the EU peashooter has so far managed just 13pc. Redcar has already paid the price for this ultra-free trade ideology, and Port Talbot is about to follow. There will eventually be little left if the current drift in trade policy is allowed to continue. China’s share of global steel output has risen from 10pc to 50pc over the last decade. It has installed capacity of 1.2bn tonnes a year that it can never hope to absorb as the construction boom deflates.

On OECD estimates it has built up 400m tonnes of excess capacity, twice the EU’s entire steel production. China’s unwanted steel is finding its way systematically into Europe, greased by export subsidies, tax breaks, cheap state credit, and the panoply of measures used by a mercantilist power to rig global trade. China has captured 45pc of the UK market for high fatigue rebar steel, from near zero four years ago. The price of hot rolled steel in Europe has fallen to $369 a tonne from an average of $650 from 2009 to 2013.

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Are people ready to acknowledge the extent of China’s bubble? I doubt it.

China Produced More Steel In 2 Years Than The UK Did Since 1870 (Conway)

Here’s a nugget that goes at least some of the way towards explaining the current woes of the British steel industry: in the past two years alone China has produced more steel than the total cumulative output of the UK since the industrial revolution. Or consider this: at today’s rate of production, it would take 68 years for Britain to generate the steel China churns out of its mills in a single year. Take a moment to digest these facts, because you simply cannot understand the pressures faced by the British, or for that matter every country’s steel industry without considering China. Steel is, of course the critical ingredient in modern manufacturing and construction. If you are making something – anything – chances are you will need steel to make it with, whether that’s a car, a rail line, a can of food or a skyscraper.

And to start with, China was a positive story for Britain’s steel industry. As it expanded over recent decades it initially didn’t produce enough steel of its own to satisfy its seemingly limitless domestic appetite for steel – from Chinese construction to Chinese cities desperate to expand, to Chinese manufacturers pumping out goods around the world. It became an important destination for UK exports. However, gradually the country has built its own steel industry – and what an industry. Since 1980 China has gone from producing 5% of the world’s steel to making more than half of it – just over 800m tonnes.

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But of course, this being Bloomberg and all, here comes the silver lining.

China Ends This Quarter With The World’s Worst-Performing Stock Market (BBG)

China’s Shanghai Composite Index is closing out the first quarter as the world’s worst-performing global measure, down 15%, with a rebound in March failing to compensate for a terrible start to the year. Here are some key metrics that may show this month’s 12% recovery may extend into April, including growth in margin lending, a jump in the number of new investors and easing volatility. Leverage is increasing, suggesting individual investors are slowly regaining confidence after getting burned last year. The value of outstanding margin loans, the fuel for the 2015 boom, is up about 6% to about 874 billion yuan ($135 billion) since touching a 15-month low on March 16. A state-backed agency restarted offering some loans to brokerages to fund clients’ borrowed bets, signaling a loosening of policies put in place to stem the market rout.

Volatility is receding. Thirty-day price swings in the Shanghai gauge have plunged since soaring to a four-month high in February. Volatility began to rise at the start of January, when regulators introduced a circuit-breaker system meant to reduce wild market movements. The circuit breakers had the opposite effect – trading was suspended twice in the first week due to steep declines before the mechanism was shelved altogether. The ChiNext index re-entered a bull market this month, rebounding 20% from a February low. The small-cap gauge, dominated by technology and consumer companies, has become a leading indicator for the Shanghai index. It entered a bull market in October, a month before the large-cap gauge did, and lapsed into a bear market a week before the Shanghai gauge followed suit.

The number of new stock investors rose to a nine-month high of 535,000 in the week ended March 25, as a rebound in margin trading and a market recovery led more people to open trading accounts. Retail investors account for 80% of stock trading. While the valuation of the Shanghai Composite is almost down 40% from a June high, it’s still 15% pricier than the MSCI Emerging Market index, according to data compiled by Bloomberg. Almost 60% of the 240 Shanghai-listed companies with full-year earnings estimates compiled by Bloomberg have missed projections so far.

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So far it was oil, steel, gas firms; now the banks start?!

China Investment Bank Defaults On ‘Dim Sum’ Bond (FT)

A unit of Guosen Securities, China’s eighth-largest investment bank, has defaulted on a Kong Kong-traded renminbi bond, according to a document seen by the Financial Times, marking the first debt breach by a state-owned enterprise in China’s offshore bond market in nearly two decades. The technical default by Guosen’s Hong Kong affiliate puts at risk a Rmb38m ($5.9m) coupon payment due April 24 on Rmb1.2bn in “dim sum” bonds sold in 2014. Missing that payment would set a precedent for the offshore units of Chinese SOEs, whose creditors widely assume the onshore parent will always stand behind its affiliates, according to analysts. The default was unexpected because Guosen’s onshore unit is by all appearances in rude health. With the city government of Shenzhen as its largest shareholder, Guosen Securities was fourth on the league table for stock and bond underwriting in 2015, according to AsiaMoney.

The Shenzhen-listed brokerage earned net profit of Rmb14.2bn in 2015, up 188% from a year earlier, according to a filing in January. It ranked eighth among mainland brokerages by assets at the end of 2014, according to industry association figures. Like other Chinese securities companies, Guosen benefited from a surge in stock trading commissions during China’s equity market roller coaster last year. But its offshore unit, Guosen Securities (HK) Financial Holdings, has struggled to gain a foothold in Hong Kong’s capital markets, where foreign and mainland banks compete on a more level playing field. A special purpose vehicle owned by Guosen (HK) issued the bonds in April 2014 at an interest rate of 6.4%.

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It may already be too late to sell.

China’s Little Emperors Prop Up Aussie Housing Market (BBG)

Han Fantong, an accountant, beat almost 60 other bidders to buy a three-bedroom home in Melbourne in November for A$930,000 ($709,000). He had an advantage – full funding from his parents back in China. Han, 32, an Australian permanent resident, bought the house on 688 square meters (7,400 square feet) of land in Ringwood East, about 30 kilometers (19 miles) east of Melbourne’s business district, after a five-month search. His parents sold a 23-year-old two-bedroom apartment in Beijing for 8.1 million yuan ($1.2 million) to help pay for the property, he said by phone. “It comes as a tradition in China to buy a home for a son to establish a family,” said Han who lives in the house with his 29-year-old wife Chen Junyang. “Without my parents, it would still be difficult for us to bear the large mortgage loans.”

Han is among scores of buyers who with the backing of relatives in China are underpinning a housing market in Australia that’s coming off the boil. More than half the buyers of Chinese origin are supported financially by relatives residing in the world’s second-largest economy, according to McGrath, Australia’s only listed real estate agency. The firm’s China desk has assisted in sales worth A$140 million since it was established in September 2013. Such demand, whether from permanent residents or overseas buyers, has triggered community concern that locals are being priced out of Australia’s property market. The government has responded to the unease with tighter scrutiny of foreign investment that critics say may deter much-needed offshore capital.

“Chinese buying in Sydney and Melbourne has stepped up from say where it was five years ago, but publicity around that has created a perception which has run ahead of reality,” said Shane Oliver at AMP Capital Investors in Sydney. “The Chinese demand – both from mainland China and Chinese Australians – is propping up the market and boosting construction.” [..] Purchases by foreigners, many with a connection to China, helped drive an almost 55% jump in home prices across Australia’s capital cities in the past seven years as mortgage rates dropped to five-decade lows. The median Sydney home price reached a record A$800,000 in October, according to research firm CoreLogic data. It has since fallen after a regulatory clampdown led to a slowdown in mortgages to landlords and the first increase in borrowing costs in five years.

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And that’s just official numbers. As is 1.67% in bad loans, which “..could be as high as 8.1% this year; other analysts have projected even higher estimates.” That’s perspective.

China’s Largest Banks Post Lowest Annual Profit In A Decade (WSJ)

China’s biggest banks posted their lowest annual profit growth in a decade, as bad loans mount in an ailing economy that is pushing lenders toward riskier avenues of expansion. Three major banks that reported 2015 results on Wednesday said they wrote off 142 billion yuan ($21.85 billion) in irrecoverable debt last year, 1.4 times the volume in 2014, an indication that their customers—many of them state-owned industrial companies—are struggling to repay loans. Profits for the three banks were nearly flat, compared with industry growth rates of close to 40% just three years ago. Banks are building ever-larger capital buffers to cover bad loans as Chinese companies flounder under a severe overhang of real-estate inventory and excess industrial capacity.

The prevalence of bad loans means booming business for asset-restructuring companies—state-owned “bad banks” set up to soak up and sell off soured debt—prompting conventional banks to explore ways to keep such deals for themselves. Net profit overall among commercial lenders rose 2.4% last year, compared with 9.6% a year earlier, according to figures put out recently by the China Banking Regulatory Commission. On Wednesday, China’s largest bank by assets, Industrial & Commercial Bank of China, posted 0.5% profit growth to 277.1 billion yuan ($42.65 billion) for 2015. “The operating results were achieved on top of a high base in light of mounting growth-related difficulties,” ICBC said in its annual report. “The larger the total profit, the harder the growth will be.”

[..] Industrywide, nonperforming loans rose to 1.67% of total loans last year from 1.25% in 2014, the China Banking Regulatory Commission said. Investment bank China International Capital estimated the true ratio could be as high as 8.1% this year; other analysts have projected even higher estimates. Credit is souring so fast that commercial lenders are having a hard time expanding capital provisions to keep pace. Two years ago, China Construction Bank was setting aside a buffer that was more than twice the size of its bad loans. Last year, that ratio had fallen to 1.5 times, it said Wednesday. Slowing profit growth has forced many Chinese banks, especially midsize lenders, to invest aggressively in shadow-banking assets such as trust and wealth-management products. Such holdings, termed “investment receivables,” are opaque cocktails of high-yield assets that could jeopardize liquidity should banks need to offload them if markets turn turbulent, analysts say.

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They have no choice. No major or even minor oil producer does.

Saudi Aramco Expanding Oil and Gas Projects Even With Low Prices (BBG)

Saudi Arabian Oil Co. is pressing ahead with an expansion of the Khurais oil field despite lower crude prices and plans to double its production of natural gas over the next 10 years, the company’s chief executive officer said. The world’s biggest oil exporter, known as Saudi Aramco, won’t cancel any oil, gas or refining projects, Amin Nasser told reporters during a conference in Al-Ahsa in eastern Saudi Arabia. Aramco is also studying a possible expansion of the country’s largest oil refinery, Ras Tanura, which has a capacity of 550,000 barrels a day, he said. “Until now all of our downstream and upstream projects are continuous,” Nasser said. “No project in our programs got canceled.”

[..][ Khurais oil field’s expansion is due to be complete in 2018, Nasser said. Aramco was seeking to add 300,000 barrels a day to the field’s production to reach a capacity of 1.5 million barrels a day, the company’s former CEO Khalid Al-Falih said in October 2013. Ghawar oil field, the world’s biggest, has been producing for 70 years and will keep pumping oil for “many years to come,” Nasser said at the conference. Sixty% of Saudi Arabia’s crude oil output comes from Ghawar, Abdul Latif Al-Othman, governor of the Saudi Arabian General Investment Authority, said at the same event. Aramco has made a “promising” shale gas discovery at the Jafurah field in the Al-Ahsa region and is assessing and appraising the area for future production, Nasser said. The company plans to double its gas production to 23 billion cubic feet a day over 10 years, he said. Aramco will also keep exploring for oil and gas in the Red Sea area, he said.

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Anything our former Oil Drum colleague Robert Rapier writes is still worth a read.

The World’s Largest Public Oil And Gas Companies (Rapier)

The past two years have been a wild ride for investors in the world’s biggest publicly traded oil companies. Compared with their high-water marks in mid-2014, Big Oil shares are down about 25% and earnings have collapsed. The big irony: even as oil prices have halved, Big Oil is still getting bigger. In July 2014 U.S. oil production was 8.75 million barrels per day, according to the Energy Information Administration. Nearly a year (and a 50% price dip) later, U.S. oil output had grown to 9.69 million bpd, its highest level in 45 years. U.S. production has since declined by more than half a million bpd to 9.07 million bpd, but global production continues to rise. From 92.4 million bpd in 2014, global oil production is up to 94.8 million bpd. A unique aspect of the recent surge is that most of the gains have not come from OPEC’s national oil companies.

While Saudi Arabia’s national oil company, Saudi Aramco, remains the world’s undisputed production leader, Western and Russian companies have added far more production over the past few years. The biggest contributor to new global oil production has been the U.S., where the shale oil boom added more than 4 million bpd of new production since 2010. In total, about two dozen countries expanded their oil production over the past five years, including Saudi Arabia, Canada, United Arab Emirates, Iraq, Kuwait and Russia. On a corporate basis, many of the companies responsible for the production increase are on our list of the World’s 25 Largest Public Oil and Gas Companies. Russian companies dominate the top of the list, which is based on the most recently published production data, accounting for more production than any other region.

Russia has been a major producer of oil and gas for decades, and when privatization took place in the 1990s a handful of extremely large companies were created that rival many of the world’s national oil companies. The U.S. has seven companies in the top 25, more than any other country, led by ExxonMobil, which is the world’s third largest public oil and gas producer. Many may not realize that China is among the world’s Top 5 oil producing countries. But PetroChina, which went public in 2007, produces almost as much oil as does ExxonMobil, and is but one of the three Chinese companies in the Top 25. European countries are well-represented on the list, as four of the world’s six integrated “supermajors” are headquartered in Europe. The largest of this group is BP , still ranked as the 5th largest oil and gas producer in the Top 25, despite its many divestments since the Deepwater Horizon disaster.

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Where wicked witch of the west Blythe Masters enters the blockchain.

Bitcoin Technology’s Next Big Test: Trillion-Dollar Repo Market (WSJ)

Depository Trust & Clearing Corp., a firm at the center of Wall Street’s trading infrastructure, is about to give the technology behind bitcoin a big test: seeing whether it can be used to bolster the $2.6 trillion repo market. DTCC said in a statement Tuesday that it will begin testing an application of blockchain, the digital ledger originally used to track ownership and payments of the cryptocurrency bitcoin, to help smooth over problems in the crucial but increasingly illiquid corner of short-term lending markets known as repurchase agreements, or “repos.” Repos play a critical role in the financial system by keeping cash and securities circulating among hedge funds, investment banks and other financial firms.

DTCC, an industry-owned utility that helps settle trades in the repo market and elsewhere, wants to apply blockchain technology to the market, so that lenders and borrowers can keep track of securities and cash flowing between firms in real time. To test blockchain’s ability to improve repo trading, DTCC has tapped Digital Asset Holdings, a startup run by former J.P. Morgan executive Blythe Masters. Earlier this year, DTCC invested in the firm focused on blockchain applications, along with a range of banks including J.P. Morgan, Goldman Sachs Group Inc., and others. Typically in repos, money-market funds lend cash to brokers in exchange for bonds and an agreement to buy back the securities later at an agreed-upon rate.

During the financial crisis however, problems in the repo markets were singled out for their role in the demise of Bear Stearns and Lehman Brothers. Now, big banks have been shying away from facilitating some repo trades due to new regulations that curtail the firms’ ability to take risks. Murray Pozmanter, managing director and head of clearing services at DTCC, said in an interview the new arrangement with Digital Asset should help because the ledger would provide a way for all firms to agree on trade terms more quickly. Currently, he said, traders have to process two legs of each trade separately: one for the borrower to deliver securities in exchange for cash, and the other in which DTCC unwinds the trade. While the trade is in motion but not yet completed, the banks involved can take on risk.

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Banks will be robots. Is that a good thing?

Growth Of Fintech Forecast To Spur Almost 2 Million Banking Job Cuts (FT)

European and US banks will cut another 1.7m jobs in the next decade as financial technology companies stalk profitable growth areas such as lending and payments, a new report by Citigroup has predicted. The 108-page Citi note takes a forensic look at where “fintech” companies are deploying their resources, how much business they have already won and the consequences for the traditional banking industry. The job cuts — equal to more than 30% of the staff the banks currently employ — come on top of the 730,000 jobs that Citi says US and European banks have already shed from their peak staffing levels. “Obviously the biggest take out will happen in countries that have been through a crisis or are tech savvy,” said Ronit Ghose, one of the authors of the report.

In the US, investment banks clearly have selectively cut a lot of people but US consumer banks haven’t cut as much … in Europe there s been little progress on branch headcount as well. The catalyst for the job cuts is twofold. One factor is the new technologies that enable banks to do more online and less in branches. The other is the financial imperative for banks to be leaner as they deal with an onslaught of new competition in their most profitable niches. High quality global journalism requires investment. Citi’s research found that lending stood out as a key battleground, accounting for 46% of the $19bn in private funding that flowed into fintech during the past six years. The next biggest was payments, accounting for 23% of the investment in fintech.

Lending and payments are both lucrative activities for banks, and losing out on market share is particularly painful when low interest rates are crippling banks’ profitability and low loan demand has made it almost impossible for them to increase revenue. “So far most of the market value in fintech has been created by companies that are embedded in the still relatively new ecosystem of ecommerce,” the report noted. “For banks in many countries, this is an opportunity lost rather than a loss of existing earnings.”

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Very interesting investigation.

The Bribe Factory – How The West Corrupts The Middle East (SMH)

A massive leak of confidential documents has for the first time exposed the true extent of corruption within the oil industry, implicating dozens of leading companies, bureaucrats and politicians in a sophisticated global web of bribery and graft. After a six-month investigation across two continents, Fairfax Media and The Huffington Post can reveal that billions of dollars of government contracts were awarded as the direct result of bribes paid on behalf of firms including British icon Rolls-Royce, US giant Halliburton, Australia’s Leighton Holdings and Korean heavyweights Samsung and Hyundai. The investigation centres on a Monaco company called Unaoil, run by the jet-setting Ahsani clan. Following a coded ad in a French newspaper, a series of clandestine meetings and midnight phone calls led to our reporters obtaining hundreds of thousands of the Ahsanis’ leaked emails and documents.

The trove reveals how they rub shoulders with royalty, party in style, mock anti-corruption agencies and operate a secret network of fixers and middlemen throughout the world’s oil producing nations. Corruption in oil production – one of the world’s richest industries and one that touches us all through our reliance on petrol – fuels inequality, robs people of their basic needs and causes social unrest in some of the world’s poorest countries. It was among the factors that prompted the Arab Spring. Fairfax Media and The Huffington Post today reveal how Unaoil carved up portions of the Middle East oil industry for the benefit of western companies between 2002 and 2012. In part two we will turn to the impoverished former Russian states to reveal the extent of misbehaviour by multinational companies including Halliburton. We will conclude the three-part investigation by showing how corrupt practices have extended deep into Asia and Africa.

The leaked files expose as corrupt two Iraqi oil ministers, a fixer linked to Syrian dictator Bashar al-Assad, senior officials from Libya’s Gaddafi regime, Iranian oil figures, powerful officials in the United Arab Emirates and a Kuwaiti operator known as “the big cheese”. Western firms involved in Unaoil’s Middle East operation include some of the world’s wealthiest and most respected companies: Rolls-Royce and Petrofac from Britain; US companies FMC Technologies, Cameron and Weatherford; Italian giants Eni and Saipem; German companies MAN Turbo (now know as MAN Diesal & Turbo) and Siemens; Dutch firm SBM Offshore; and Indian giant Larsen & Toubro. They also show the offshore arm of Australian company Leighton Holdings was involved in serious, calculated corruption.

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A point I’ve written a lot about. All our major institutions select for sociopaths (a term I’m more comfortable with in the context than psychopath).

Pathocracy: The Rise Of The Political Psychopath (Whitehead)

Twenty years ago, a newspaper headline asked the question: “What’s the difference between a politician and a psychopath?” The answer, then and now, remains the same: None. There is no difference between psychopaths and politicians. Nor is there much of a difference between the havoc wreaked on innocent lives by uncaring, unfeeling, selfish, irresponsible, parasitic criminals and elected officials who lie to their constituents, trade political favors for campaign contributions, turn a blind eye to the wishes of the electorate, cheat taxpayers out of hard-earned dollars, favor the corporate elite, entrench the military industrial complex, and spare little thought for the impact their thoughtless actions and hastily passed legislation might have on defenseless citizens.

Psychopaths and politicians both have a tendency to be selfish, callous, remorseless users of others, irresponsible, pathological liars, glib, con artists, lacking in remorse and shallow. Charismatic politicians, like criminal psychopaths, exhibit a failure to accept responsibility for their actions, have a high sense of self-worth, are chronically unstable, have socially deviant lifestyle, need constant stimulation, have parasitic lifestyles and possess unrealistic goals. It doesn’t matter whether you’re talking about Democrats or Republicans. Political psychopaths are all largely cut from the same pathological cloth, brimming with seemingly easy charm and boasting calculating minds. Such leaders eventually create pathocracies—totalitarian societies bent on power, control, and destruction of both freedom in general and those who exercise their freedoms.

Once psychopaths gain power, the result is usually some form of totalitarian government or a pathocracy. “At that point, the government operates against the interests of its own people except for favoring certain groups,” author James G. Long notes. “We are currently witnessing deliberate polarizations of American citizens, illegal actions, and massive and needless acquisition of debt. This is typical of psychopathic systems, and very similar things happened in the Soviet Union as it overextended and collapsed.” In other words, electing a psychopath to public office is tantamount to national hara-kiri, the ritualized act of self-annihilation, self-destruction and suicide. It signals the demise of democratic government and lays the groundwork for a totalitarian regime that is legalistic, militaristic, inflexible, intolerant and inhuman.

So why do we keep doing it over and over again? There’s no shortage of dire warnings about the devastation that could be wrought if any one of the current crop of candidates running for the White House gets elected. Yet where the doomsayers go wrong is by ignoring the damage that has already been inflicted on our nation and its citizens by a psychopathic government.

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We should be thankful Russia has such patience.

Russia Vows ‘Totally Asymmetrical’ Response To US Troop Build-Up In Europe (RT)

Russia’s envoy to NATO has vowed a “totally asymmetrical” response if the alliance stands by a plan to deploy new armored units to eastern Europe. Citing Russian “aggression” as a pretext, the US has announced “continuous troop rotations” starting 2017. “We are not passive observers, we consistently take all the military measures we consider necessary in order to counterbalance this reinforced presence that is not justified by anything,” Moscow’s permanent representative at the alliance Aleksandr Grushko said in an interview with TV channel Rossiya-24 on Wednesday. “Certainly, we’ll respond totally asymmetrically.” Grushko has not elaborated further on his statement, but said that Russia’s actions would correspond to its “understanding of the extent of the military threat, would not be extremely expensive, but also highly effective.”

“As of today, assessing as a whole what that the US and NATO are doing, the point at issue is a substantial change for the worse in the security situation,” he said. The comments from Russia’s NATO envoy fell shortly after the Pentagon announced a plan to increase its troop presence in “the European theater” of up to three fully-manned Army brigades by the end of 2017, one armored, one airborne and one Stryker brigade. “This Army implementation plan continues to demonstrate our strong and balanced approach to reassuring our NATO allies and partners in the wake of an aggressive Russia in Eastern Europe and elsewhere,” Air Force Gen. Philip M. Breedlove of the US European Command said. “This means our allies and partners will see more capability – they will see a more frequent presence of an armored brigade with more modernized equipment in their countries.”

The first such rotational armored brigade combat team would arrive in Europe in February next year. Each of the brigades will be on nine-month rotations and bring their own equipment to use for exercises across Europe. NATO also wants to enhance Europe’s current equipment and replace it with “the most modern the Army has to offer.” At the same time, the older gear would become a core of the earlier unveiled “Army pre-positioned stocks”, which NATO would keep in Belgium, the Netherlands and Germany. [..] “Reading these materials makes your hair stand on end, because of how some experts discuss with aplomb that if NATO had not taken measures, our [Russia’s] tanks would have already be in Tallinn and Riga,” Grushko said.

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Positive feedback. Accelerating returns.

Sea Levels Set To ‘Rise Far More Rapidly Than Expected’

Sea levels could rise far more rapidly than expected in coming decades, according to new research that reveals Antarctica’s vast ice cap is less stable than previously thought. The UN’s climate science body had predicted up to a metre of sea level rise this century – but it did not anticipate any significant contribution from Antarctica, where increasing snowfall was expected to keep the ice sheet in balance. According to a study, published in the journal Nature, collapsing Antarctic ice sheets are expected to double sea-level rise to two metres by 2100, if carbon emissions are not cut. Previously, only the passive melting of Antarctic ice by warmer air and seawater was considered but the new work added active processes, such as the disintegration of huge ice cliffs.

“This [doubling] could spell disaster for many low-lying cities,” said Prof Robert DeConto, at the University of Massachusetts Amherst, who led the work. He said that if global warming was not halted, the rate of sea-level rise would change from millimetres per year to centimetres a year. “At that point it becomes about retreat [from cities], not engineering of defences.” As well as rising seas, climate change is also causing storms to become fiercer, forming a highly destructive combination for low-lying cities like New York, Mumbai and Guangzhou. Many coastal cities are growing fast as populations rise and analysis by World Bank and OECD staff has shown that global flood damage could cost them $1tn a year by 2050 unless action is taken. The cities most at risk in richer nations include Miami, Boston and Nagoya, while cities in China, Vietnam, Bangladesh and Ivory Coast are among those most in danger in less wealthy countries.

The new research follows other recent studies warning of the possibility of ice sheet collapse in Antarctica and suggesting huge sea-level rises. But the new work suggests that major rises are possible within the lifetimes of today’s children, not over centuries. “The bad news is that in the business-as-usual, high-emissions scenario, we end up with very, very high estimates of the contribution of Antarctica to sea-level rise” by 2100, DeConto told the Guardian. But he said that if emissions were quickly slashed to zero, the rise in sea level from Antarctic ice could be reduced to almost nothing. “This is the good news,” he said. “It is not too late and that is wonderful. But we can’t say we are 100% out of the woods.” Even if emissions are slashed, DeConto said, there remains a 10% chance that sea level will rise significantly.

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A good Yanis article.

Europe Is Too Important To Be Left To Its Clueless Rulers – Varoufakis (Tel.)

It is eight months since Varoufakis resigned as Greece’s finance minister, in the wake of the historic referendum when the Greek people voted to reject the demands of the country’s creditors, the so-called ‘troika’. It was the result that Varoufakis and the Greek prime minster Alexis Tsipras had been campaigning for. But within 24 hours Tsipras had performed a volte-face, accepting the troika’s terms. Varoufakis resigned. A politician without office, Varoufakis now spends his time writing, giving speeches and campaigning to reform Europe from the grass roots up. In February he launched Diem25, a pan-European umbrella group, aiming to pull together left-wing parties, protest movements and ‘rebel regions’ from across the continent, with the object, as he puts it, to ‘shake Europe – gently, compassionately, but firmly’, and bring ‘democracy back to EU decision making.’

He has published a new book, And the Weak Suffer What They Must?, a detailed historical analysis of the origins of Europe’s financial crisis. Its basic thesis is that the eurozone is not the route to shared prosperity it was intended to be but “a pyramid scheme of debt with countries such as Greece, Ireland, Portugal and Spain at its bottom”. Its conclusion, put bluntly, is that Europe “is too important to be left to its clueless rulers”, and that the eurozone must be “fully recalibrated” if Europe is to avoid a “postmodern” repetition of the 1930s, with financial chaos, the rise of fascism, and the spectre of conflict.

He has recently returned from Abu Dhabi, talking to business leaders at the Global Financial Markets Forum. For every 15 lectures he gives for free, he gets paid for one, he says, ‘but that’s good enough’. And the self-described ‘erratic Marxist’ is a popular draw among bankers and financial institutions. ‘I say to them exactly what I say to a left-wing audience,’ he says. ‘For some reason bankers like my analysis of the euro and global crisis. They’ve had enough of people telling them what they think they want to hear, because that hasn’t worked very well for them in the last seven or eight years. The fact they want me to talk to them is a sign of how deep this crisis is.’

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At least at first glance, a great story. Let’s hope they win some golds too.

Refugees Run For Rio Olympic Dream Team (AFP)

High up in Kenya’s rugged Ngong Hills, refugees sprint around an athletics track in intensive training they hope will see them selected for a unique team for the Rio Olympics. Hand-picked from Kenya’s vast refugee camps – including Dadaab, the biggest in the world — to join the training camp just outside the capital Nairobi, the athletes here have their eyes set on racing in Rio de Janeiro in August. “It will be a very great moment for me and the rest of the refugees, who will be so proud for having produced one of their own who has gone to the Olympics,” said 22-year-old Nzanzumu Gaston Kiza, who fled Democratic Republic of Congo after his relatives were massacred in ethnic clashes. Here at Ngong, a high altitude running track some 2,400 meters (7,875 feet) above sea level, some 40 kilometres (25 miles) southwest of Nairobi, athletes from across eastern Africa are chasing the dream of the Olympics.

Amid a world record number of people forced from their homes and their countries, the International Olympic Committee (IOC) this month announced the creation and funding of Team Refugee Olympic Athletes (ROA) to compete in Rio under its flag. The team, expected to include between five to 10 athletes from across the world, is part of the IOC’s “pledge to aid potential elite athletes affected by the worldwide refugee crisis”. “Team ROA” will march just before the hosts Brazil enter the Olympic Stadium at the opening ceremony – carrying the Olympic flag and anthem – a position likely to be given enormous cries of support. While countries may field their own teams, the refugees are unable to return home safely to take part – and instead will run under the Olympic flag. “We want to send a message of hope for all refugees in our world,” IOC president Thomas Bach said when plans for the team were announced.

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International law no longer has any meaning. Welcome to Europe.

Austria To Tighten Asylum Rules (P.)

Austria is to introduce procedures at its borders to speed up asylum applications and limit the influx of refugees into the country, the government announced Wednesday. From May, authorities will determine “within hours” if an applicant can provide sufficient reason not to be sent back to a safe third country of origin, Austrian Interior Minister Johanna Mikl-Leitner and Defense Minister Hans Peter Doskozil said. “We will not accept any more asylum applications, unless we have to because of certain criteria like Article 8 of the human rights convention,” Mikl-Leitner said, referring to an article that grants asylum seekers, among other things, the right to stay in a country where they have a partner or children.

The announcement followed news that legal experts commissioned by the Austrian government found that a cap of 37,500 refugees allowed to apply for asylum per year, introduced by Vienna at the beginning of the year, was incompatible with international law. As of the end of March, 15,000 asylum applications had been submitted in Austria this year, according to the country’s interior ministry.

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This will not stop. It may move from one spot to another, but it will continue no matter what. Such is the despair.

Refugee Arrivals To Greece Rise Sharply Despite EU-Turkey Deal (Reuters)

Arrivals of refugees and migrants to Greece from Turkey rose sharply on Wednesday, just over a week since the European Union and Turkey struck a deal intended to cut off the flow. Greek authorities recorded 766 new arrivals between Tuesday morning and Wednesday morning, up from 192 the previous day. Most arrived on the northeastern Aegean island of Lesvos. Italy reported an even larger jump in arrivals on Tuesday, when officials there said 1,350 people – mostly from Africa – were rescued from small boats taking the longer migration route over the Mediterranean as the weather warmed up. The EU Commission said on Tuesday that the flows in the last week had reduced, with only 1,000 people arriving from Turkey on Greek islands, compared to an average of 2,000 a day in the last couple of months.

It was not clear why numbers had dropped, but the Aegean Sea had been hit with bad weather and gale force winds, making the journey from Turkey on small rubber boats even more dangerous. Under the deal in effect since March 20, migrants and refugees who arrive in Greece will be subject to being sent back once they have been registered and their individual asylum claim processed. The returns are to begin from April 4. More that 51,000 refugees and migrants, among those Syrians, Afghans, Iraqis and other fleeing conflict in the Middle East and Asia, are currently stranded in Greece following border closures across the Balkans. Nearly 6,000 people remain stuck at the country’s biggest port of Piraeus port near Athens, having arrived there on ferries from Greek islands close to Turkey before the deal.

Scores have found shelter in passenger waiting lounges while hundreds more sleep in the open, either in flimsy tents or on blankets spread on the dock. Queues for the few portable toilets are long, and scuffles have broken out in recent weeks over mobile phone chargers and food distribution. International rights group Human Rights Watch has described conditions at the port, including basic hygiene, as “abysmal” and says the situation is akin to a “humanitarian crisis.”

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