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Debt Rattle September 11 2026

Sep 112026
 
 September 11, 2026  Posted by at 9:40 am Finance Tagged with: , , , , , ,  31 Responses »


Roy Lichtenstein Femme d’Alger 1963


• Trump Floats $5,000 For Every US Adult Citizen If GOP Holds Congress (ZH)
• ‘The Greatest Evangelist for American Liberty,’ Charlie Kirk (Salgado)
• Tributes Pour in on Anniversary of Charlie Kirk’s Martyrdom (Salgado)
• European Leaders Trying To ‘Buy Time’ For Kiev With Ceasefire Calls – Lavrov (RT)
• ECB Raises Interest Rates to Avoid Settling Ukraine-Russia Conflict (CTH)
• Democrats Asked for It, and Trump and the GOP Delivered (Eric Florack)
• Bessent: ‘Nothing Else Matters’ If China Pulls Ahead of US in AI (ET)
• New Four-hour Elon Musk Documentary (BBC)
• The US Has Entered Stage 3 in the Trade War With Canada (Victor Davis Hanson)
• The Story of Slavery Told Correctly (Paul Craig Roberts)
• Jamaica Demands Answers On Slavery (Egountchi Behanzin)

 


 

 


 


“Stimmy” Checks?!

• Trump Floats $5,000 For Every US Adult Citizen If GOP Holds Congress (ZH)

During a speech Wednesday night at the GOP’s midterm convention in Dallas, Texas, President Trump proposed sending every adult American citizen a $5,000 “Trump dividend” if Republicans retain control of both chambers of Congress in November. “If the Republicans win the House of Representatives and the United States Senate, both of them,” Trump said, “I will issue a dividend to every adult citizen in the United States of America for $5,000.”bHe continued, “It will be called the Trump dividend,” adding, “Now all we have to do is win.”


Trump told the audience at the American Airlines Center: “Your vote will decide whether our country stumbles at the starting gate of our next 250 years or surges forward and never looks back.” nQuick math: A $5,000 payout to 270 million adults would cost the US government approximately $1.35 trillion. The proposal comes as US public debt surpassed $40 trillion for the first time in recent weeks.mBloomberg strategist Mark Cudmore warned that a large fiscal injection could intensify existing market pressures, including weaker Treasuries, dollar depreciation, and demand for commodities and other real assets.

“The general reaction from markets is very muted precisely as everyone sees almost zero chance of this happening. The US economy is strong and already at risk of running too hot, so pumping in so much extra fiscal stimulus when under funding pressure will exacerbate all the dynamics we’re already focused on in markets: weaker Treasuries, a depreciating dollar and a rush to commodities and real assets,” Cudmore said.

The proposal also arrives as Trump acknowledges that significant fuel-price relief may not come until after the midterms. The national average for gasoline remains above the politically sensitive $ 4-per-gallon level, while diesel prices are at record highs. Trump also indicated that the Iran conflict could continue beyond the elections. President Trump’s approval rating is around 38%, according to reporting by The Guardian.

Vice President JD Vance said that these proposed post-election direct payments to Americans could be funded by revenue from Trump’s wide-ranging tariff program.

Read more …

He gave Trump young America. And now?

• ‘The Greatest Evangelist for American Liberty,’ Charlie Kirk (Salgado)

Exactly a year ago today, an LGBTQ radical assassinated Charlie Kirk with one shot, taking away in a split second a man who could have been the next great leader of America’s Patriots for decades to come. At the Republican midterm convention, President Donald Trump paid tribute to Charlie, and the White House released a video in his honor.


The White House video combined clips of Charlie himself, including from that morning at Utah Valley University just before he died, along with clips from Charlie’s funeral and Trump‘s eulogy. “On that terrible day, Sept. 10, 2025, our greatest evangelist for American liberty became immortal; he’s immortal now for American freedom,” Trump had praised Kirk. Do we remember what Charlie stood for enough to carry on his legacy with enthusiasm and courage?


With his speeches and debates around the country from the time he was a teenager, Charlie Kirk was able to electrify young people in a way the most conservatives never have. “Do you know you are part of something bigger than yourself?” the White House clip of Kirk asked. “Do you know that you are part of the most exciting, diverse, powerful movement in the history of this country? This movement is about the citizens versus the oligarchs. This movement is about We the People versus the ruling class. This movement is about America versus the globalists. This movement is about all of us against them.”

Kirk loved the Biblical saying, “Here I am. It means, ‘Lord, use me.’ Abraham, at the binding of Isaac said, ‘Lord, here I am.’ Moses at the burning bush,… Samuel, Isaiah… It means, ‘give me the orders,’” he said. Erika Kirk has harkened back to this attitude of her husband’s and how he had offered himself to God, without realizing that he was going to be a martyr.

Trump made a point of honoring Charlie Kirk at the midterm convention on the evening of September 9, just before the anniversary of his death. “In Charlie’s honor, I just want to say we love you, Charlie, and Erika is here someplace,” Trump said, urging Charlie’s widow to stand up. The packed crowd gave Erika Kirk a standing ovation, and then broke out into chants of, “Charlie! Charlie!”


During the speech, Trump reflected, “It was actually one year ago tomorrow, a far-left extremist assassinated my great friend and conservative voice, Charlie Kirk, because Charlie Kirk spoke the truth.” And of course, it was precisely Kirk‘s success at what he did, and his unfailing charity in doing so, that made him such a promising candidate for president in the future and a particular target of leftist hatred. Tyler Robinson killed Kirk, and countless leftists celebrated the assassination because Kirk was too persuasive with the truth.


Trump referred to this reality. “What shocked millions of Americans was not only the fact that Charlie was murdered, as bad as it was, but also how many people made an excuse for it or cheered for it. They were cheering, some people, sick people. For a brief moment, the mask came off the radical left, and you saw what they were… all about. And now those same people are trying to get power over you in this election, and they are all voting Democrat.”

We cannot bring back Charlie Kirk, but we can try to continue the work that he began so successfully of bringing young people back to a love for country, faith, and family. Winning this midterm election is what Charlie would want, but it is only the beginning.

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9/11 commemoration turns into Charlie Kirk memorial.

• Tributes Pour in on Anniversary of Charlie Kirk’s Martyrdom (Salgado)

“One year ago, our nation witnessed pure evil when Charlie Kirk was taken from us,” Attorney General Todd Blanche declared September 10. But as Texas Attorney General Ken Paxton declared, “I miss my friend, and I’ll honor him by never backing down… Charlie will never be forgotten.”


President Donald Trump paid tribute to Kirk both at the Republican midterm convention Wednesday night and in a video the White House released to “the greatest evangelist for American liberty.” Trump urged Americans to vote against the party that celebrated Kirk’s death. “It was actually one year ago tomorrow, a far-left extremist assassinated my great friend and conservative voice, Charlie Kirk, because Charlie Kirk spoke the truth,” the president emphasized. Many members of his administration also praised Charlie and mourned the anniversary of his death. Secretary of State Marco Rubio illustrated how he is trying to implement policies that would make Charlie proud.


HHS Secretary Robert F. Kennedy Jr. wrote, “One year ago, a bullet silenced one of the most eloquent truth-tellers of our era. But it could not silence the principles Charlie Kirk stood for. Today, we honor Charlie’s devotion to God, to our country, and to the Constitution. We carry his legacy forward by summoning his best virtues in ourselves—and living with the courage, conviction, and faith that defined his life.” Similarly, Bishop Robert Barron praised Charlie‘s ability to see every human being as a beloved creation of God. Like the White House, Secretary of War Pete Hegseth used the biblical commendation, “Well done, good and faithful servant.”


White House advisor Stephen Miller exclaimed, “Charlie was a beloved friend, an unflinching ally, and an indispensable warrior for America. He was murdered not only by an evil assassin but an entire ecosystem of far-left extremism that normalizes, justifies and glorifies violence against its political opponents. The success of America depends upon the dismantlement of these violent networks. As we grieve an unimaginable loss, we pledge ourselves to accelerate the work for which Charlie gave his very life. No one can remain on the sidelines when the stakes are so vast.”


One artist is honoring Charlie with a statue in New York City, and there is also a new statue of Charlie in Phoenix.


Charlie’s own Turning Point USA and his widow Erika released heart-breaking homages. “We have had to learn how to carry on without the person who was at the center of everything we do,” the TPUSA team said soberly. “We have celebrated milestones that Charlie should have been here to celebrate. We have stood on stages where his voice should have been heard. We have watched his children grow without their father there to see it. And we have felt the weight of his absence in ways that never seem to get easier.” Indeed, “For the people who knew and loved Charlie, September 10 will never simply be an anniversary. It is the day our lives were changed forever.”


The Daily Wire’s Ben Shapiro warned against conservatives splitting into hate-filled and conspiratorial factions, urging a united front against all the leftists celebrating “Kirkiversary.”

There were even international tributes. Slovenian Prime Minister Janez Jansa posted, “A man of strong faith, a husband and a father, Charlie believed that political and ideological differences should be confronted through argument and democratic debate – never through hatred or violence… Charlie Kirk is no longer with us, but the values he stood for – freedom of expression, faith, courage and peaceful political debate – remain. They deserve to be defended.”

But the greatest tribute that any of us can ever give Charlie Kirk is to continue the work that he started and refuse to let the radical, godless left take over America.

Read more …

“Russia will not accept as a neighbor a nation ruled by a “Russophobic and aggressive neo-Nazi regime,” the top diplomat has said ..”

• European Leaders Trying To ‘Buy Time’ For Kiev With Ceasefire Calls – Lavrov (RT)

Zelensky and Finnish President Stubb, Kiev, Ukraine, August 24, 2026

European leaders calling for a ceasefire in the Russia-Ukraine conflict are seeking to preserve the government in Kiev in its current aggressive anti-Russian form, Russian Foreign Minister Sergey Lavrov has said. Even politicians who acknowledge that Kiev cannot militarily retake the former Ukrainian regions that have joined Russia since 2014 and now advocate a truce are pursuing an agenda that threatens Russia and its citizens, the top diplomat said. Speaking in an interview on Tuesday, Lavrov named Finnish President Alexander Stubb and Italian Prime Minister Giorgia Meloni as examples.


The proposed ceasefire “is also just a way to buy time, as everyone knows,” Lavrov said, adding that Ukrainian leader Vladimir Zelensky “makes no secret of that” as he seeks additional weapons supplies. mAccording to the Russian minister, the goal of this ploy is to preserve and keep in power “the regime currently ruling in Kiev,” whose defining traits he described as “Nazism, aggressive Russophobia, violations of human rights, language rights and religious freedom.” As for Europe, it wants to preserve that openly Russophobic and aggressive neo-Nazi regime. It is the European plan. I don’t see how the Russian people can accept this outcome.

Moscow’s objections to freezing the conflict remain unchanged, as does its opposition to proposals to deploy troops from NATO member states in Ukraine following a potential peace deal, Lavrov said. “Any people in military uniforms and any military facilities will be legitimate [targets] for us, and no scenario under which Ukraine will acquire NATO membership in all but name is acceptable to us,” he stressed.Lavrov was interviewed in Moscow by Russian-American television host Dimitri Simes and visiting US political commentator Andrew Napolitano, better known as Judge Napolitano, after his former role on the New Jersey Superior Court.

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Good observation. The EU blames Putin AND Trump. And it wants no ceasefire.

• ECB Raises Interest Rates to Avoid Settling Ukraine-Russia Conflict (CTH)

The European Central Bank raised interest rates a quarter of a percent claiming the effort will reduce energy prices. However, the primary cause of higher energy costs is energy policy not monetary policy. As you can see, Europe is blaming the Iran conflict, and by extension blaming President Trump for inflicting higher oil and gas prices. Yet in reality, it was the European decision to cut themselves off of Russian oil and gas that led to their massive price increases.


In essence, if you ask yourself how far the EU collective is willing to go in order to combat the fictitious threat represented by Russia’s conflict with non-EU state Ukraine, it appears there is no upper limit. Rather than assist in a resolution of the Ukraine-Russia conflict, they are willing to keep fueling the war and diminishing their own economy in the process. From the perspective of the welfare of the average European, none of this makes sense. This is bureaucratic ideology running amok.

FRANKFURT, Germany (AP) — The European Central Bank raised interest rates Thursday to cool inflation that is being fed by high oil prices from the Iran war. The decision was supported by a stronger-than-expected economy that suggests businesses can weather the higher borrowing costs. The central bank for the 21 EU member countries that use the euro currency raised its benchmark rate by a quarter percentage point to 2.50% at a meeting held in Berlin, away from the bank’s Frankfurt headquarters.

Bank President Christine Lagarde said at her news conference that “the conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period.” “The outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth,” she said, adding that the bank would make future rate decisions meeting by meeting based on incoming data. She said the central bank would not commit to any particular path for rates before seeing the data. (read more)

It is ironic his announcement comes from Berlin as the German economy announces the loss of 100,000 auto workers while the EU Central Bank says, “a stronger than expected economy.” Ever the faithful leftist WEF member, Poland Prime Minister Donald Tusk notes that Poland is paying the highest energy prices in the world, but he faithfully supports the EU agenda. Because it’s Russia’s fault, and of course he does.

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“Stopping him from doing what, exactly?” That’s the question Democrats don’t want asked, because it’s where their whole strategy comes apart.”

• Democrats Asked for It, and Trump and the GOP Delivered (Eric Florack)

Ever the consummate showman, President Trump invented the concept of the midterm convention, and he stepped right in to headline it. But there’s a perfectly legitimate argument that Republicans should run on what they’ve actually accomplished rather than turning this election into another referendum on one man. I made exactly that argument myself, at column length, yesterday in the VIP article, “So, What Has Donald Trump Actually Accomplished?” (If you’re not a VIP member yet, why not?)


Elections ought to be about results, policy, and competing visions for the future — not another round of “Trump good” versus “Trump bad.” That’s the ideal. Unfortunately, politics doesn’t happen in the ideal. It happens in the real world, and every strategy has to survive contact with the reality surrounding it.

And here’s the reality Republicans can’t wish away: Democrats have already made Donald Trump the centerpiece. They’ve been doing it for over a decade. Since he first came down that escalator, Democrats and most of the institutional media have treated virtually everything in American life as somehow being about Donald Trump — his personality, his tweets, his speeches, his insults, his policies, his supporters, his opponents, his legal troubles, his victories, his defeats.

Did the cat hack up a hairball on your pillow while you were sleeping? Trump’s fault. Car won’t start? Trump’s fault. Kid brought home a report card that reads like a cry for help? Also, somehow, Trump’s fault. At this point, Democrats have done everything but formally rename the San Andreas Fault “Trump’s Fault.” For years, Democrats told voters, loudly and on an endless loop, that the defining issue facing the country is Donald Trump. They made him the issue. They made him the villain. They made him the explanation for everything they didn’t like.

They made him the explanation for everything that happened after he left office. They made him the explanation for everything that’s happened since he came back. bAnd now, having spent years insisting Donald Trump is an existential threat to the Republic, they apparently expect Republicans to politely agree that maybe we shouldn’t bring him up too much this fall? That’s adorable.

Sorry. That’s not how this works. Republicans can certainly choose to talk about something else — but that strategy has a fatal flaw: you don’t get to unilaterally decide what the other side’s campaign is about. If Democrats plan to spend the whole cycle talking about Trump (and obviously they do), pretending he isn’t part of the election just hands them the subject uncontested. Not answering them isn’t strategy. It’s surrender with better lighting.

There’s also a real difference between making Trump the centerpiece and simply recognizing that the opposition has already made him the centerpiece. Those aren’t nearly the same move. Republicans don’t have to make every speech about Trump. They don’t need his face on every mailer. They don’t need every candidate sounding like they were personally deputized by Trump to defend Western civilization before breakfast. But they do need to recognize the political battlefield they’re standing on.

The question isn’t whether Republicans should crown Donald Trump the centerpiece of the midterms. It’s whether they’re willing to fight on the battlefield that already exists — which is exactly what I did in yesterday’s column, and from what I saw, what they did last night, in Texas. If Democrats are going to campaign on stopping Trump, Republicans have every right, and frankly an obligation, to ask voters a simple follow-up: “Stopping him from doing what, exactly?” That’s the question Democrats don’t want asked, because it’s where their whole strategy comes apart.

It’s one thing to tell voters that Donald Trump is an awful human being, a threat to democracy, a fascist, a dictator-in-waiting, or whatever label happens to be trending that week. And as they’ve demonstrated, you don’t even need to have any proof of any of it. Simple repetition does the work. However, it’s an entirely different thing to explain why the actual policies voters are living under should be thrown out. Democrats have clearly demonstrated that they can’t do the second part. They’ve never had to — they’ve spent a decade coasting on the former.

Read more …

“There Is No Day After Tomorrow”; Bessent Warns Of Consequences To Losing AI Arms Race To China,

• Bessent: ‘Nothing Else Matters’ If China Pulls Ahead of US in AI (ET)

Treasury Secretary Scott Bessent said the United States cannot afford to fall behind China in artificial intelligence, warning that a Chinese lead would outweigh other U.S. advantages. “Beating China – there is no day after tomorrow if China wins at this,” Bessent said on Sept. 9 at Breitbart News’s “State of the Economy” event in Washington. “If they were to pull ahead of us on AI, then nothing else matters.” Bessent made the remarks while answering a question about opposition to data centers and the need to expand the infrastructure required for AI development.


On the same day, the National Security Agency, Cybersecurity and Infrastructure Security Agency, and FBI issued a joint advisory accusing six China-based AI companies of conducting industrial-scale campaigns to extract capabilities from U.S. frontier AI models. The agencies named DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, and Z.AI, saying the companies had extracted billions of tokens through millions of requests to frontier models including Claude, GPT, Gemini, and Grok since at least late 2024.

Agencies Detail Model Distillation
Knowledge distillation is a machine learning technique in which one model is trained using the outputs of another. The technique is commonly used legitimately, including to develop smaller or less expensive models. The advisory alleged, however, that the six companies engaged in “aggressive, malicious, and targeted” distillation at an industrial scale to extract restricted proprietary functions and capabilities from U.S. models. The NSA said the companies were systematically extracting U.S. model capabilities to train their own systems.

According to the advisory, the companies distributed their activity across model providers, cloud platforms, and other infrastructure to avoid detection. Some used third-party services to relay requests to U.S. models, allowing them to bypass geographic restrictions and other safeguards, the agencies said. The agencies assessed that the alleged activity took place “likely with Chinese government awareness.” The advisory did not state that Chinese authorities directed the individual campaigns.

It said DeepSeek had allegedly conducted an organized campaign since at least late 2024 to obtain reasoning capabilities, specialized optimizations, and other functions for use in its R1 and V3 models. The agencies also attributed large-scale distillation activity to Alibaba’s Qwen models and to models developed by the other four companies. The agencies said such activity could allow Chinese AI developers to narrow the technology gap while avoiding some of the computing power, electricity, foundational research, and other costs required to independently develop frontier models. The advisory stated that advances in Chinese AI models could also expand military and cyber capabilities.

Beijing rejected the allegations on Sept. 9. Chinese Foreign Ministry spokeswoman Mao Ning said China’s AI development came from domestic technological development and international cooperation. The Sept. 8 advisory urged American AI companies and infrastructure providers to improve detection of suspicious activity and strengthen coordination across model developers, cloud providers, and application programming interface providers to counter large-scale distillation campaigns.

Earlier Warnings From US AI Companies
The federal advisory follows earlier accusations by American AI developers. Anthropic said in February that it had identified industrial-scale campaigns by DeepSeek, Moonshot AI, and MiniMax involving more than 16 million exchanges with Claude through approximately 24,000 fraudulent accounts. The accounts violated its terms of service and regional access restrictions, Anthropic said. It also said that while distillation is a legitimate training method, competitors can misuse it to acquire capabilities developed by other companies without bearing comparable development costs.

OpenAI separately told the House Select Committee on the Chinese Communist Party in February that it had observed activity indicating continued attempts by DeepSeek to distill capabilities from OpenAI and other U.S. frontier models, including through increasingly obfuscated methods intended to make the activity harder to detect.

Data Centers and the AI Race
Bessent tied the competition with China to the U.S. buildout of data centers and other infrastructure needed for AI. He said the United States currently has the lead because of its technology companies, advanced chips, financing, and startup ecosystem, but argued that development could not be paused. “We can’t pause,” Bessent said. “You can’t, because the Chinese won’t pause.”

He criticized technology companies for failing to engage adequately with communities affected by new data-center construction. Bessent also alleged that some opposition to data-center development involved Chinese “agitprop.” He did not identify specific examples for that assertion during the discussion. He gave data-center developers, hyperscalers, and major AI companies a “D-minus” for community outreach and said they needed to do a better job explaining their projects and potential benefits to residents.

Read more …

Missed chance,.

• New Four-hour Elon Musk Documentary (BBC)

The Venice Film Festival has hosted the premiere of major documentary-maker Alex Gibney’s epic and provocative new profile of the richest man on Earth, which has been years in the making. Here are five key takeaways from the film.


Alex Gibney, the Oscar-winning director of Taxi to the Dark Side and Enron: The Smartest Guys in the Room, has made documentaries about some of the richest and most powerful people on Earth. But none of them has been as rich and powerful as Elon Musk. Maybe that’s why Gibney’s profile of the tech entrepreneur and SpaceX boss is such an epic. Musk, which premiered at the Venice Film Festival on Tuesday, has a running time of 225 minutes, and will be released with a 10-minute intermission – so that’s almost four hours on the life and work of the world’s richest man.

Still, the time rockets by. There is little in the film that isn’t already on record, but Gibney gathers all the extant reporting into one breathlessly fast-moving, largely negative, and terrifyingly apocalyptic profile. Here are five things you should know about the documentary – just in case you don’t have four hours to spare.

1. Musk himself isn’t interviewed – but appears as an AI avatar
Gibney initially tried for an interview with Musk, but when the project was announced back in March 2023, Musk declared on social media that it would be a “hit piece”, to which Gibney responded, “How would you know?” The director’s solution is to have an AI-generated avatar of Musk repeat things that he has said in public. This is apt, says Gibney in his voiceover, because Musk believes that we might all be living in a simulation – a video game being played by our descendants in the future.

2. David Byrne helped write a theme song
David Byrne has co-written Let Me Sell You a Dream for the film’s closing credits, which has lyrics consisting entirely of phrases spoken by Musk in the past. The title is appropriate, according to some of Gibney’s interviewees, who say that Musk tends to attract investment by promising that imagined future accomplishments – such as cities on Mars and completely safe self-driving cars – are imminent or already realised.

“That’s not happening,” says Adam Becker, an author and astrophysicist, about Musk’s scheme to colonise Mars. “The gravity is too low, the radiation is too high, there’s no air, and the dirt is filled with poison.” Musk has consistently defended his visionary philosophy however: “I’m very good at predicting the future,” he told The Economist in a July interview. “I’m not perfect but I’m very good… people don’t realise that what I’m saying will come to pass – maybe not exactly in the timing that I thought, but it will come to pass.”


3. Musk’s time in the White House is scrutinised The film suggests that Musk dealt with the US government the way he dealt with Twitter. Zoë Schiffer, the author of Extremely Hardcore: Inside Elon Musk’s Twitter, says that after Musk bought the social media platform, what she refers to as his “goons” pushed out the majority of the staff without pausing to learn what they actually did. Later, as the head of President Trump’s Department of Government Efficiency, or Doge, Musk followed “the Twitter playbook”, Schiffer says, describing how he tried and failed to wipe out the US national debt by slashing the budget of numerous departments, this time with the help of a group of assistants in their early twenties who had no government experience. Musk bemoaned that Doge had become “the whipping boy for everything” in an interview with the Washington Post in May last year, just before leaving the Trump administration.


4. An old British film makes a surprise appearance
Gibney uses clips from a British fantasy film, The Man Who Could Work Miracles (1937), to illustrate his very dramatic view of Musk. In this black-and-white classic, based on an HG Wells story, a celestial being bestows an ordinary man (Roland Young) with infinite powers. The man eventually demands that the world’s leaders change society instantly, but he ends up accidentally destroying the planet.

5. The film has had a strong reception so far
Reviews from the Venice premiere have so far been largely positive. Variety called it “a lacerating and important watch, grounded in Gibney’s supremely insightful but user-friendly mastery of the documentary form”, while in a four-star review, The Telegraph dubbed it “a chillingly forensic hatchet job”. Unsurprisingly, Musk himself has not been one of its admirers: on X on Wednesday, among other comments, he described the film as “a hit piece that misses, and makes the fatal sin of being boring for 4 hours”.

Read more …

“They’re fed up with countries that said for 30 years they were gonna protect themselves and help NATO, and the most egregious offender in the last 15 years has been Canada.”

• The US Has Entered Stage 3 in the Trade War With Canada (Victor Davis Hanson)

The philosopher Heraclitus, an ancient Greek philosopher, once said that you don’t step into the same river twice, meaning the river flows. Other people look at that quote and said he meant panta rhei, everything flows or changes, although he didn’t necessarily say that himself. Everything changes. That applies to our current U.S.-Canadian spat. We were given an initial description in the media, and then we had some clarification, and now we’re in what I would call Stage Three.


Stage One was outrage at Donald Trump and the United States, and this is the narrative that we got from one side, from Mark Carney. He said the Americans are at it again, and Trump in particular. They’re bullying us. They’re demanding that they’re gonna take away our sovereignty, and they’re saying to whom, and with whom we can trade and with whom we can’t. And then, they wanna squash Canadian nationalism, and they want to suppress indigenous reading, literature, influence in the French language, and we’re not gonna do that. So we had to back out.

So, everybody got very angry. The Wall Street Journal said: This is a silly Trump spectacle right on the eve of the midterms. This is crazy. nAnd then we went into Stage Two: clarification. People in Canada, 90%, supported Carney. They were booing the American “Star-Spangled Banner” when it was played at sporting events in Canada. And they started to informally boycott U.S. products.

And then they stuck out their chest and said we might not give four million barrels of oil to the United States from Canada. We may stop our pipeline. We can do all of these things to the United States. They need us. And the world is against Trump. And our prime minister can deal with China if he wants. He prefers China. bSo, we heard all that, and then we found out that the deal was almost cemented, and Carney brought up his objections at the last moment.

Then we found out the United States did not wanna suppress the French language or Indigenous culture in Canada. It just said our digital media companies operate worldwide. Why, in this particular country of Canada, should they pay a 5% surtax on top of charge, in addition to income tax, just to subsidize for the particular agendas of the Canadian government? We don’t do that to Canada. We don’t say, “If you come into the United States and you have a product or a media conglomerate, we’re gonna slap a 5% so we wanna promote DEI, we want to promote poor white people in East Palestine.” We don’t do that.

Then we find out that we don’t want to take away Canada’s sovereignty. We are in an existential struggle to save the West from Chinese mercantilism. They have been dumping product. They have been manipulating currency. They’ve been stealing patents. They don’t respect copyrights. They run up trillion-dollar surpluses with us, half a trillion with Europe, and we’re saying no more. We want symmetry.

And [China], to get around that, is dumping cheap steel and aluminum and saying to Canada, “You can buy our product very cheap, much cheaper than you can produce it. Then you can use it in your assembly of cars and trucks and other manufactured goods and send it into the United States and undercut American producers. You win, and then we get around the American tariffs.” And Trump and his team said, “No, we know what you’re doing.” So, that was a clarification that didn’t look too good.

Then people said, “Well, wait a minute. Canada can’t even send its oil, highly sulfurous and thick tar sands, to Ontario or to British Columbia because the provinces are so at each other’s throats under this weird system that they don’t. They have almost autonomy with one another, and they won’t let pipelines be built. But the Americans will let it be built.” So, they need the 4 million-a-day export. After all, if Canada’s doing so well, why don’t … Alberta said, “We can’t give you our oil. We need it. We’re booming. That’s what we’ve been told.

“Why would we give it to a booming United States that already is the greatest producer of gas and oil in history and self-sufficient, unless it’s in our interest? It’s right across the border. The United States treats us better than our other provinces treat us. They allow a pipeline into a foreign country, i.e., the United States. Our other provinces don’t allow Alberta to do that. “And, by the way, they allow a pipeline then to go into Quebec and Ontario. If we cut off their pipeline, they’ll cut off two of our provinces.”

And then the jobs report came out. We’ve only been at this 10 days, but it already affected the August jobs report. They said, “We didn’t need the United States.” Well, they’re down 41,000 jobs. And we can hurt the United States? The United States is up 160,000 jobs. And so now we’re in a crisis. How does Canada get out of this situation? Because they walked out of a deal that was better than basically any other deal the United States had cut with other countries, and it was only one of two countries. The other in the same league was communist China that retaliated against the United States.

The others admitted, “Aw, shucks. We know we’ve had asymmetrical tariffs with you for a long time. We understand this is a reckoning. Let’s kind of moderate it and don’t get too hysterical that we’ve been taking you to the cleaners on trade.” OK. Not Canada. Canada immediately started retaliating like China. OK. And now they’re in Stage Three. What is Stage Three? Stage Three is the Americans are saying to themselves:

Well, we have 13 times the economy that Canada does, and we have nine times the population, and we have one state, California, that has about the same population as all of Canada. And of all of our states, it’s the worst run, the most socialist, with the most inept governor, and usually with the highest social welfare costs, the highest taxes, the highest unemployment, the highest inflation, the highest power. And guess what? It has double the gross domestic product of Canada, even though there’s the same population. Double.

And then the Americans are saying: “We don’t want—we don’t need your oil. We can produce your oil. We’d like your oil. It helps you. It helps us. But if you don’t wanna cut us off, cut us off. And we’d like to trade with you, but you know what? If you don’t wanna—if you wanna help Canada get around our tariffs, and we understand that, just don’t do it. And the subtext behind all of this is the United States is fed up. They’re fed up with countries that said for 30 years they were gonna protect themselves and help NATO, and the most egregious offender in the last 15 years has been Canada.

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High time this story was told.

• The Story of Slavery Told Correctly (Paul Craig Roberts)

For several decades I have emphasized that black slavery was a product of black slave wars in Africa for which no white person has any responsibility. It was black African rulers, such as the King of Dahomey, who enslaved and sold black Africans to Arabs and to British and European colonies in the New World where there was abundant resources and fertile land but no work force. This is an indisputable fact. Some of the most famous leftists in history, such as Karl Polanyi, have documented this fact.


Today as I write there stands on the Atlantic coast of Africa three miles south of Ouidan in Benin, the former Kingdom of Dahomey, the Gate of No Return, a memorial erected to mark the departure point where Africans enslaved by Africans were loaded aboard ships to be marketed to Arabs and to British and European colonists in the New World. The Gate of No Return sits at the end of a road known as the Route of the Slaves. As far as I can ascertain, none of this factual history is acknowledged in any black studies program in any Western university or by any of the black organizations agitating for reparations from white peoples who neither enslaved nor owned a slave.

In the Western World the entire story of slavery is a total fabrication. It is important to understand that no white Southerners or white anyone went into Africa to round up black slaves. The black King of Dahomey was a powerful person. His army was armed with rifles obtained from the Arabs in exchange for slaves. The King had an Amazon contingent, reportedly extremely ferocious. No one was going to poach on the King of Dahomey. Any who wanted slaves paid the King’s price. Dahomey dominated the slave wars, and the captives of Dahomey’s wars were the slaves who ended up in America.

As slaves were the products of slave wars between black Africans, many of the slaves sold to colonists in the British colonies that eventually became the US were themselves warriors engaged in slave wars against other blacks who were defeated in combat. I have often made the point that every collection of slaves on Southern plantations in the American South contained trained warriors captured in combat who greatly outnumbered the number of whites on the “slave cotton plantations.” Any such behavior of slave owners, such as that fraudulently reported by Harriet Beecher Stowe in Uncle Tom’s Cabin would have resulted in a successful uprising.

Plantation owners understood this, and for their own preservation and that of their families did not behave as the lying bitch Harriet Beecher Stowe alleges in Uncle Tom’s Cabin. The purpose of Uncle Tom’s Cabin was war propaganda, to stir up hatred of the South by northerners in order to make acceptable Lincoln’s war criminals, Sherman and Sheridan. The south was defeated by the North’s destruction of the South’s livestock and farms, leaving the Confederacy unable to provision the Army of Northern Virginia which in the end was marching in bare feet with no food.

The proof that there was unity between the slaves and the plantation owners was demonstrated by the complete failure of Lincoln’s Emancipation Proclamation. This was a war measure that Lincoln intended would draw Confederate soldiers from the front lines to return home to protect their families from black insurrection. But no insurrection occurred, and the Southern soldiers did not leave the front lines.

Lincoln, a war criminal of the highest order, issued the Emancipation Proclamation, which as Lincoln’s own Secretary of State pointed out, applied only to slaves under Confederate control, and not to any under Union control, out of frustration that Union general after Union general whose forces were three to four times larger than Lee’s Army of Northern Virginia were repeated defeated by General Robert E. Lee, a leader who steadfastly refused to participate in war crimes.

The Emancipation Proclamation was a complete failure as a war measure. But the white liberals misrepresented a war measure as the freeing of the slaves from “Southern oppression.” What are we to think of northern liberals this totally dishonest, this totally devoid of all integrity, of all respect for historical truth? I won’t print the expletives that come to mind. The “freedom” left former slaves without homes and food. Many were raped by Union soldiers. “Liberated” blacks followed behind the Union armies hoping their “liberators” would provide food and water and medical care. But as the Union soldiers did not own the former slaves, no one had an investment or interest in them.

“Liberation” was chaos for the “liberated.” Many of the “liberated” experienced devastating hardship and death. Historians have documented that the contraband camps that were set up by the Union were characterized by overcrowding, poor sanitation, meager food rations and by massive outbreaks of diseases such as smallpox and dysentery. The brutal conditions killed a large percentage of the Southern black population. The consequence of “emancipation” was genocide. The former slaves who survived did so by performing manual labor for the Union occupying army.

A country with a high percentage of people as dishonest as white liberals has no chance of being great if it is to be a multicultural society. No multicultural society can exist when the disparate interests are turned against one another in hate, which is what the white liberals have done to America.

The alleged American “civil war” is another fabrication. The war was the result of the North, which Lincoln called the Union, invading a separate country, the Confederacy, which had exercised its constitutional right to exit the United States in order to avoid being economically exploited by northern manufacturing which insisted on a tariff to be paid by the South on its exports and imports. The day before Lincoln’s inauguration the Northern Congress passed the Morrill Tariff that imposed massive economic cost on the South. Simultaneously Lincoln and the Northern Congress offered the South Constitutional protection forever of slavery if the South would stay in the Union and pay the tariff.

The South replied that their concern is the tariff, not slavery. Despite all evidence the white liberals claim without a shred of evidence that the Union cause was to deliver blacks from slavery. Clearly, people as unworthy as white liberals desperately need to be replaced by immigrant-invaders. I was delighted when I read that the white liberal government in Massachusetts had decided to replace themselves with Muslims. Perhaps there is some virtue in The Camp of the Saints. The white liberals will be the first to go, just as they are in The Camp of the Saints.

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“Egountchi Behanzin, founding president of the international African Black Defense League, spokesperson for the Pan-African Brothers, political analyst, and pan-African activist..”

• Jamaica Demands Answers On Slavery (Egountchi Behanzin)

Knocking on the king’s door: Decades in the making, the September 7 filing brings a direct legal challenge against the British Crown for its ties to the slave system


On September 7, 2026, a high-level Jamaican delegation delivered a historic legal petition to Buckingham Palace addressed to King Charles III. Its objective was to compel the monarch, as Jamaica’s head of state, to refer to the Judicial Committee of the Privy Council, the island’s highest court of appeal, three questions that have haunted the British Empire for centuries. Was the forced transportation of Africans to Jamaica and their subsequent enslavement lawful? Did this system constitute a crime against humanity? Does the United Kingdom bear an obligation to make reparation for slavery and its enduring consequences?

Culture Minister Olivia Grange, who led the delegation, shared a photo on X of herself holding the document aloft, captioned: “The petition has been filed.” King Charles III was not present at the handover. British media reported he was on vacation at the time, though Buckingham Palace said it had worked closely with the Governor General of Jamaica to ensure the petition was properly lodged.

Why the date is no coincidence
The day before, on Sunday, September 6, the delegation had taken part in a church service in south London under the theme of “remembrance, justice and repair,” ahead of the formal filing the following day. This timing is no accident: September 6 commemorates the 1781 departure of the slave ship Zong, aboard which more than 140 enslaved Africans were thrown into the sea so their owners could collect an insurance payout. That crime, unpunished for 245 years, now stands as the symbol of a justice the diaspora refuses to let fade into oblivion.

“In relation to the wrongs that were done, we want answers,” Grange told the Associated Press the day before the filing. “Once we get those answers, then our attorneys will determine what the next move is.” This petition is part of a strategy, built step by step by Jamaica’s National Council on Reparations chaired by Laleta Davis Mattis, with the support of a legal subcommittee led by attorney Bert Samuels, and a team of UK lawyers. The Caribbean Community (CARICOM) has thrown its full weight behind the effort proof that this question reaches beyond the borders of a single island. The entire post-slavery Caribbean is rising behind Jamaica.

The UN slavery resolution as a first step
But it is precisely here that Jamaica’s fight joins Africa’s own, and this link must now be made visible, since Western media have worked hard to keep it quiet. On March 25, 2026, the United Nations General Assembly adopted, on Ghana’s initiative, resolution A/RES/80/250 – the very first resolution in UN history devoted exclusively to slavery and the transatlantic slave trade.One hundred and twenty-three states voted in favor. Only three opposed it: the United States, Israel, and Argentina. Fifty-two countries, mostly European including the United Kingdom itself, chose to hide behind abstention.

The resolution designates the transatlantic trafficking of Africans and racialized chattel enslavement as the “gravest crime against humanity.” Ghanaian President John Dramani Mahama, speaking on behalf of the African Group of 54 states, the UN’s largest regional bloc, declared that voting for the text meant standing on the right side of history. It calls for the restitution of looted cultural property, formal apologies, and opens the door to the consideration of financial compensation. This is an international normative framework, patiently built by the African Union since February 2024, when it proclaimed 2025 the “Year of Justice for Africans through Reparations for Slavery, Colonialism, and Apartheid.”

Jamaican jurist Bert Samuels was not mistaken when he stated that this UN resolution strengthens Jamaica’s legal position against London. Here is the thread that binds Accra to Kingston, the African motherland to the diaspora torn from it. A single struggle is fought on two complementary fronts – one continental and diplomatic, the other insular and judicial, both aimed at the same goal of making the former empire pay for four centuries of human plunder.

A history of reversed debts
To grasp the full weight of this gesture, one must recall that Haiti, the first free black nation of the modern era, was forced in 1825 to pay France a colossal indemnity to “compensate” former slave owners for the loss of their “human property” – a debt that bled Haiti’s economy for more than a century. History, as written by the colonial powers, long decreed that it was the enslavers who deserved compensation, never the enslaved.

Jamaica’s petition overturns this criminal logic. It is no longer the victims who owe the executioner, it is the executioner who must now answer to its victims. This reversal builds on groundwork laid over more than a decade by the CARICOM itself, which as early as 2013 adopted its own ten-point plan for reparatory justice, demanding formal apologies, debt cancellation, technology transfers, and public health programs to offset the health devastation bequeathed by slavery.

The September 7 filing is therefore the legal culmination of a long matured Caribbean strategy that has now chosen to confront head on, in a court of law, the very institution that sanctioned and protected the slave system: the British Crown.

What it means for the diaspora
For the African diaspora across Africa, the Americas, Europe, and the Caribbean alike, this filing is experienced as a long-deferred reckoning. For generations, our elders awaited a political gesture of this magnitude – a formal legal demand addressed directly to the head of the house that organized, financed, and profited from the trade.

Reparations movements that once fought each in their own corner Caribbean organizations, Afro-descendant collectives in the Americas, African diasporas in Europe, activists on the continent itself are beginning to speak with a single voice, carried by recognized institutions: the African Union on one side, CARICOM on the other, and now the UN as a global sounding board.

In West Africa, Jamaica’s move is being followed with particular attention, seen as the natural extension of the fight President Mahama carried to the UN stage. The Africa that watched its children leave in chains is, four centuries later, reunited with a part of its diaspora now come to knock, together, on the same imperial door. In Southern Africa, where the memory of apartheid remains raw, many Pan-African organizations see in this filing further proof that struggles for historical justice slavery, colonialism, apartheid can no longer be treated separately, but must be understood as a single, unified case against the West.

In Europe, among Afro-descendant communities in France, Belgium, and the United Kingdom itself, Jamaica’s petition serves as both a signal of hope and a painful reminder: That our own states of origin or residence still drag their feet on these questions, while little Jamaica, with its modest means, dared to carry the fight directly to the monarch’s door. In the Americas, Afro-descendant movements from Brazil to Colombia are also watching this case closely, seeing in it a potential legal precedent that could be mobilized for their own claims against the former Iberian colonial powers.

This convergence is visibly rattling Western capitals. The United Kingdom’s vote – an abstention, that is, a refusal to choose – speaks volumes about the quiet panic setting in London. One can sense, in the remarks of certain British political figures, particularly within Euroskeptic and identitarian factions, a desire to ridicule Jamaica’s move, to dismiss it as an expensive whim or a political stunt.

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https://twitter.com/EricLDaugh/status/2098040640378425446?s=20

 

 

 

 

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Debt Rattle July 13 2022

Jul 132022
 
 July 13, 2022  Posted by at 8:31 am Finance Tagged with: , , , , , , , , , , , ,  41 Responses »


Pablo Picasso Guernica [Study] 1937

 

• The Judgement of the Nations (Batiushka)
• No, Iran Will Not Deliver Armed Drones To Russia (MoA)
• Joe Biden’s Oil Gamble Set to Backfire as Saudi Arabia Sticks With Russia (NW)
• The World Braces For Europe’s July 22 “Doomsday” (ZH)
• Washington Isn’t Ready for Higher Interest Rates (NR)
• Democrats Defend Trump Officials’ COVID-19 Response (NW)
• Covid Booster Significantly Delays End Of Infection (INN)
• FDA Colluded With Moderna to Bypass COVID Vaccine Safety Standards (CHD)
• The Serious Adverse Events of mRNA Covid-19 Vaccine Trials (Demasi)
• Cassidy Hutchinson Begged Trump Officials For ‘Financial Assistance’ (DC)
• The Ex-CIA Agents Deciding Facebook’s Content Policy (MacLeod)
• Someone Tell The PM The World Needs More Fertilizer, Not Less (TSun)
• DUCK AND COVER 2.0: Prepare for a Nuclear Attack (Celente)

 

 

 

 

I simply don’t understand this anymore.

Hawley – Khiara M. Bridges, Professor Of Law, UC Berkeley School of Law, Berkeley, CA
https://twitter.com/i/status/1546892242899668992

 

 

 

 

State secrets on the table.

Bolton – Jake Tapper: “One doesn’t have to be brilliant to attempt a coup.”
John Bolton: “I disagree with that. As somebody who has helped plan coup d’etat, not here, but other places, it takes a lot of work.”
https://twitter.com/i/status/1546963273408565249

 

 

PaxVax
https://twitter.com/i/status/1546900583919095810

 

 

 

 

“Russia knew that in order to win a war, you have to win the peace afterwards.”

• The Judgement of the Nations (Batiushka)

Originally, this was not a war, but a limited Operation, still involving a small proportion of the Russian Armed Forces. Had Russia wanted to occupy the Ukraine with massive military violence, in German, with a ‘Blitzkrieg’, in American, with ‘shock and awe’, with hundreds of thousands, perhaps millions, of victims, all could have been done in a couple of weeks. However, this is not Hollywood. That was not the aim. The clear aim was to free the Russian part of the Ukraine and to demilitarise and denazify the rest, so it would no longer present a threat to the Russian World. Obviously, doing this meant not just winning the genodical war which the backers of the Kiev regime had begun in 2014, but also doing it, causing the smallest number of victims among the Russian and Allied military and Ukrainian civilians as possible, and at the same time doing the least amount of damage to civilian infrastructure as possible.

Pictures showing huge damage to civilian infrastructure, especially in Mariupol and Donetsk, show above all the enormous amount of damage done by NATO-backed Kiev regime bombardments over the last eight years. It was clear to Russian military and political planners that the Operation would take at least months, perhaps years, as the whole of the Kiev Armed Forces had been digging in here for eight years. Russia knew that in order to win a war, you have to win the peace afterwards. It was no good doing like the Americans did in Vietnam, Iraq and Afghanistan, destroying infrastructure, making the people hate you and then, once you realise that you have lost, running away, leaving chaos and misery.

The Russian authorities also knew that since NATO had already de facto declared war on Russia in 2014, the Operation to liberate the Ukraine through denazification and demilitarisation would further activate their war effort and provoke many more ‘sanctions’. Now that the Operation has become a NATO war against Russia, much as expected, it is all the more difficult to forecast the future. Many missed the point. The Special Military Operation is not where it is at. The Ukraine is only the location, the battlefield, and the Kiev junta are only the actors on the stage, puppets. This is not primarily a battle of the military and their technologies, although they are very important, this is above all a battle of world views and ensuing realities. This battle is political and economic, spiritual and moral. Why else did the Johnson regime ban the Russian Orthodox Patriarch from visiting the UK?

Here we understand President Putin’s words of 7 July 2022 before Russian parliamentarians that Russia ‘has not even started anything in earnest in the Ukraine yet’, that the military operation in the Ukraine signifies ‘a cardinal break with the US world order, the beginning of the transition from the liberal globalism of US egocentricity to the reality of a multipolar world….the march of history is unstoppable and the attempts of the West to foist its New World Order on the world are doomed to failure’.

Putin – Multipolar world

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Of course not. Just a stupid attempt to implicate more of America’s perceived enemies.

• No, Iran Will Not Deliver Armed Drones To Russia (MoA)

In March this year we were treated to an onslaught of obviously false claims that China would deliver weapons to Russia for the fight in Ukraine. “Russia seeks military equipment and aid from China, U.S. officials say – Washington Post – March 13, 2022 “Russia has turned to China for military equipment and aid in the weeks since it began its invasion of Ukraine, U.S. officials familiar with the matter told The Washington Post. The development comes as White House national security adviser Jake Sullivan plans to travel to Rome on Monday to meet with his Chinese counterpart, Yang Jiechi. “We are communicating directly, privately to Beijing, that there will absolutely be consequences for large-scale sanctions, evasion efforts or support to Russia to backfill them,” Sullivan told CNN.

Russia is an exporter of military weapons and China is one of its biggest customers. There is nothing in the Chinese arsenals that Russia can not and does not produce itself. The claim was false from the get go but Sullivan, the mediocre National Security Advisor of the Biden regime, planted it to put pressure on China. It of course did not work. China denied that it had received any request from Russia or that it was in any way willing to ever fulfill one if it would come: No Chinese weapons have been seen in Ukraine. Now an equally stupid claim was launched by the very same liar who launched the fake Chinese weapons claim.

“White House: Iran set to deliver armed drones to Russia” – AP – Jul 7, 2022 “The White House on Monday said it believes Russia is turning to Iran to provide it with “hundreds” of unmanned aerial vehicles, including weapons-capable drones, for use in its ongoing war in Ukraine. U.S. National Security Adviser Jake Sullivan said it was unclear whether Iran had already provided any of the unmanned systems to Russia, but said the U.S. has “information” that indicates Iran is preparing to train Russian forces to use them as soon as this month.” “Our information indicates that the Iranian government is preparing to provide Russia with up to several hundred UAVs, including weapons-capable UAVs on an expedited timeline,” he told reporters Monday.”

Russia has for some time build mass production facilities for its own drones. A decade ago, the Russian Armed Forces possessed fewer than 200 UAVs, and now this figure stands at over 2000, and each year is replenished by 300. Furthermore, the Russian defence industry is conducting R&D on the application of artificial intelligence (AI) in UAVs, with the ambition of enabling them to perform as unified “swarms of drones” in combat zones. Sources claim that this was already tested in 2020, during the Kavkaz-2020 military exercise. Russia has absolutely no need to buy drones from Iran. Besides that it is dubious that Iran would be able to deliver some and certainly not ‘several hundreds’.

The Washington Post notes the weird timing of Sullivan’s claims thereby hinting that it was made for purely political purposes which have nothing to do with Russia: “The revelation comes as President Biden prepares to depart for the Middle East, where he is expected to confer with key allies on a unified regional policy toward Iran. Tensions between Washington and Tehran have been further strained in recent weeks, amid faltering nuclear talks and an uptick in rocket and drone attacks on U.S. military installations in the Middle East, conducted by militia groups armed and funded by Iran.” The whole issues is just a talking point designed to put Iran and Russia into the same ‘baddies’ binder for Biden’s talks in the Middle East. The countries there may not like Iran but they will certainly not allow for a condemnation of Russia. The whole idea is, as many others Sullivan had, stupid to begin with.

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Saudi’s No 1 is not the same as America’s.

• Joe Biden’s Oil Gamble Set to Backfire as Saudi Arabia Sticks With Russia (NW)

President Joe Biden’s attempt to lower rising oil prices by convincing Saudi Arabia to increase production looks set to fail as Saudi officials have indicated the country is not willing to abandon its oil production alliance with Russia, which Washington has claimed is part of the reason for sky-high fuel costs. Biden will begin his Middle East trip this week in his first trip to the region since taking office, starting in Israel and the occupied West Bank. He will end his trip in Saudi Arabia. Biden has said that the trip will advance American interests by focusing on the global trade and supply chains the U.S. relies on. Many countries in the West, including the U.S., want Saudi Arabia to produce more oil to help mitigate the growing global energy crisis that was ignited by the Ukraine war.

More production will also punish Russia, a major oil exporter, by bringing global prices down. According to a report in the Wall Street Journal on Sunday, U.S. officials said Biden will discuss Saudi Arabia’s human rights record during the trip. The paper reported that Saudi officials are not likely to make any human rights concessions nor will they be willing to abandon an oil-production partnership with Russia. Saudi Arabia has been looking to secure an oil alliance with Russia for decades but has to walk a tightrope to do this while improving strained relations with the U.S. over its human rights record. Washington and Riyadh have expressed different ideas about what the priorities will be during Biden’s visit. The Biden administration said that the summit of the Arab nations will take center stage, as the president will meet multiple heads of state from the region during the summit.

However, according to the Wall Street Journal, Saudi officials said the meeting between Biden and Saudi King Salman and his leadership team, which includes his son, Crown Prince Mohammed bin Salman, will feature “substantial exchanges between Prince Mohammed and the president on a range of topics and [Saudi officials] have described the summit as peripheral.” The crown prince is considered a pariah by many in Washington after U.S. intelligence agencies concluded in February 2021 that the 36-year-old future king approved the 2018 murder of Washington Post journalist Jamal Khashoggi.

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“European stocks plunging 20%. Junk credit spreads widening past 2020 crisis levels. The euro sinking to just 90 cents, before a full-blown recession slams the world’s 2nd biggest economy.”

• The World Braces For Europe’s July 22 “Doomsday” (ZH)

Two weeks ago, when previewing the scheduled 10-day shutdown of the Nord Stream 1 pipeline – which supplies the bulk of European nat gas usage courtesy of Russia – for maintenance, we quoted from DB FX strategist George Saravelos that if the gas shutoff is not resolved in coming weeks this would lead to a broadening out of energy disruption with material upfront effects on economic growth, and of course much higher inflation, or as he puts it, “beyond the market’s worries about slower global growth in recent months, what is unfolding in Europe in recent days is a fresh big negative supply shock.” As such, DB’s Jim Reid said that July 22, the day gas is supposed to come back online, could be the most important day of the year:

“while we all spend most of our market time thinking about the Fed and a recession, I suspect what happens to Russian gas in H2 is potentially an even bigger story. Of course by July 22nd parts may have be found and the supply might start to normalize. Anyone who tells you they know what is going to happen here is guessing but as minimum it should be a huge focal point for everyone in markets.” Fast forward to today when, one day after the start of the scheduled 10-day shutdown period which has already sent flows through to NS 1 pipeline to basically zero… … and the market is now focusing on the worst case scenario: what happens if Russia cuts off all gas on July 22, the day even Bloomberg has now dubbed Europe’s “doomsday scenario.”

Here is a sample of what Wall Street expects to happen then: European stocks plunging 20%. Junk credit spreads widening past 2020 crisis levels. The euro sinking to just 90 cents, before a full-blown recession slams the world’s 2nd biggest economy. And all this power in the palm of Putin’s hand, almost as if he knew precisely how much leverage he had back in February while Europe was – as always – completely clueless. So to help Europe’s braindead bureaucrats, where energy policies have been dictated by a petulant Scandianvian teenager and a bunch of German “greens”, strategists across Wall Street have tried to put numbers on a scenario that would be unthinkable in normal times. The caveat of course is that there are so many variables, such as the length of any shutdown, the extent of supply cuts, and how far countries would go to ration energy, that anyone’s prediction is a guess at best. Even so, the scenarios are catastrophic.

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“Washington was already projected to add $100 trillion in baseline deficits over the next three decades due primarily to Social Security and Medicare shortfalls. ”

• Washington Isn’t Ready for Higher Interest Rates (NR)

Congress and the White House are not prepared for a world with higher interest rates, and there’s no backup plan. Weary families have already seen soaring inflation reduce their real wages by 3 percent over the past year. The Federal Reserve and market forces will likely defeat inflation within a reasonable time frame. But the resulting higher interest rates will cost Washington — and taxpayers — for many years to come. Any family shopping for a new home is already feeling the interest-rate crunch. Since last year, the average mortgage rate on a conventional fixed-rate loan has jumped from 2.6 percent to 5.8 percent, pushing up the monthly payment on a median-priced home from $1,289 to $1,877. Interest rates on car loans and small-business loans have jumped as well.

Rates are likely to continue rising. The Federal Reserve has quickly hiked the federal funds rate from 0.25 to 1.75 percent, yet will likely have to go higher to crush inflation. And once inflation is defeated, a more vigilant Fed is unlikely to drop rates back within the 0–2.5 percent range that has prevailed over the past 14 years. Investors will likely demand many years of higher interest rates and an inflation risk premium to avoid getting burned again. Such a scenario helped drive up 1980s interest rates in response to 1970s inflation. Other factors that may drive up interest rates for years to come include a long-awaited productivity surge (which would increase borrowing by making capital investments more profitable, and families more willing to borrow against future wealth), global investors chasing stronger returns in faster-developing economies, and baby boomers finally spending down their decades of retirement savings.

The colossal national-debt surge projected by the Congressional Budget Office would add approximately three percentage points to interest rates over three decades. Washington, perched for now on top of a mountain of debt, can ill afford higher interest rates. For the past few years, short-sighted lawmakers, economists, and columnists have demanded that Congress take advantage of low interest rates by engaging in a massive borrowing spree. Indeed, President Biden’s enormous spending agenda was often justified by the low interest rates on government borrowing. This case never made sense for two reasons. First, Washington was already projected to add $100 trillion in baseline deficits over the next three decades due primarily to Social Security and Medicare shortfalls.

Even with low rates, interest costs were projected by the CBO to become the most expensive item in the federal budget and consume half of all tax revenues within a few decades. Additional borrowing would deepen the hole. Second, Washington never locked in the recent low interest rates. In fact, the average maturity on the federal debt has fallen to 62 months. If interest rates rise at any point in the future, nearly the entire escalating national debt would roll over into those rates within a decade. Consequently, continued federal borrowing means gambling America’s economic future on the hope that interest rates never rise again. And there is no backup plan if rates do rise.

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Martin Kulldorff and Jay Bhattacharya

• Democrats Defend Trump Officials’ COVID-19 Response (NW)

With more than one million reported COVID-19 deaths and enormous collateral damage to public health, education, and the economy, our pandemic response was a disaster. Yet some House Democrats are now defending the Trump administration officials responsible for initiating those misguided policies. Two Trump-appointed officials—former CDC director Robert Redfield and White House Coronavirus Response Coordinator Dr. Deborah Birx—formally directed the federal response from the start of the pandemic through January 2021. They adopted lockdowns, including school and business closures, as the centerpiece of the national coronavirus response. In a recent report, Democrats on the Congressional Select Subcommittee on the Coronavirus Crisis defended these Trump officials. In doing so, they reiterated the misunderstandings underpinning the Birx-Redfield-Fauci strategy.

The Trump officials made two fundamental mistakes. First, they failed to prioritize protecting older Americans from a disease that had an infection fatality rate more than a thousand times higher for the elderly than for the young, leading to many unnecessary deaths. Unlike Ebola, but similar to influenza and previously circulating coronaviruses, it was never possible to suppress COVID-19 to achieve “zero COVID.” Many countries tried, but not one succeeded. Lockdowns only prolonged the pandemic. Despite harsh government lockdowns, extensive contact tracing, and constant anxiety-inducing warnings, most Americans got infected. Inevitably so. With their singular focus on COVID suppression, Birx, Redfield, and Anthony Fauci failed to implement measures to protect older, high-risk Americans. They praised governors who ordered hospitals to discharge COVID-infected patients to nursing homes, where they infected other residents.

Excess staff rotation spread the virus both within and between nursing homes. Instead of implementing daily testing at nursing homes, Birx, Redfield, and Fauci used limited resources to test asymptomatic children and students. It was only when Dr. Scott Atlas arrived at the White House in July 2020 that the government made more tests available to nursing homes. When enough people recover from COVID, the country reaches herd immunity. After that, the disease becomes endemic, like other coronaviruses that cause occasional colds. Since the Birx-Redfield-Fauci strategy led to mass infection and eventual herd immunity, it is curious that congressional Democrats now claim these Trump officials were opposed to a “herd immunity strategy.” The truth, now obvious to all, is that all COVID strategies lead to herd immunity. That is how pandemics end.

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Because it compromises the immune system.

• Covid Booster Significantly Delays End Of Infection (INN)

A new study published in the New England Journal of Medicine (NEJM) has demonstrated that people who are triple-vaccinated (boosted) against COVID recover significantly more slowly from COVID infection and remain contagious for longer than people who are not vaccinated at all. The study did not deal with the severity of illness with or without a vaccine. Researchers swabbed infected people and cultured the swabs, repeating the process for over two weeks until viral replication was not observed. At five days post-infection, less than 25 percent of unvaccinated people were still contagious, whereas around 70 percent of boosted people were still carrying viable virus particles. For those partially vaccinated, around 50 percent were still contagious at this point.


Even more strikingly, at ten days post-infection, one-third of boosted people (31 percent) were found to still be carrying live, culturable virus. By contrast, just six percent of unvaccinated people were still contagious at day 10. In other words, people who have received a booster shot are five times more likely still to be contagious at ten days post-infection than are unvaccinated people. The findings go a long way to explaining why Paxlovid, Pfizer’s anti-viral medication, is often not effective for people who have been vaccinated against COVID, with many experiencing a recurrence of symptoms along with a positive COVID test after completing the five-day regimen (as recently occurred with quadruple-vaccinated Dr. Anthony Fauci). This phenomenon is known as COVID rebound.

Read more …

“Moderna claims the active substance — mRNA in Spikevax — does not need to be studied for toxicity and can be replaced with any other mRNA without further testing.”

• FDA Colluded With Moderna to Bypass COVID Vaccine Safety Standards (CHD)

According to an ex-pharmaceutical industry and biotech executive, documents obtained from the U.S. Department of Health and Human Services (HHS) on Moderna’s COVID-19 vaccine suggest the U.S. Food and Drug Administration (FDA) and Moderna colluded to bypass regulatory and scientific standards used to ensure products are safe. Alexandra Latypova has spent 25 years in pharmaceutical research and development working with more than 60 companies worldwide to submit data to the FDA on hundreds of clinical trials. After analyzing 699 pages of studies and test results “supposedly used by the FDA to clear Moderna’s mRNA platform-based mRNA-1273, or Spikevax,” Latypova told The Defender she believes U.S. health agencies are lying to the public on behalf of vaccine manufacturers.

“It is evident that the FDA and NIH [National Institutes of Health] colluded with Moderna to subvert the regulatory and scientific standards of drug safety testing,” Latypova said. “They accepted fraudulent test designs, substitutions of test articles, glaring omissions and whitewashing of serious signs of health damage by the product, then lied to the public on behalf of the manufacturers.” In an op-ed on Trial Site News, Latypova disclosed the following findings:

  1. Moderna’s nonclinical summary contains mostly irrelevant materials.
  2. Moderna claims the active substance — mRNA in Spikevax — does not need to be studied for toxicity and can be replaced with any other mRNA without further testing.
  3. Moderna’s nonclinical program consisted of irrelevant studies of unapproved mRNAs and only one non-GLP [Good Laboratory Practice] toxicology study of mRNA-1273 — the active substance in Spikevax.
  4. There are two separate investigational new drug numbers for mRNA-1273. One is held by Moderna, the other by the Division of Microbiology and Infectious Diseases within the NIH, representing a “serious conflict of interest.”
  5. The FDA failed to question Moderna’s “scientifically dishonest studies” dismissing an “extremely significant risk” of vaccine-induced antibody-enhanced disease.
  6. The FDA and Moderna lied about reproductive toxicology studies in public disclosures and product labeling.

“Moderna’s documents are poorly and often incompetently written — with numerous hypothetical statements unsupported by any data, proposed theories, and admission of using unvalidated assays and repetitive paragraphs throughout,” Latypova wrote. “Quite shockingly, this represents the entire safety toxicology assessment for an extremely novel product that has gotten injected into millions of arms worldwide.”

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“Trials” in this case doesn’t mean what it usually does. There have been either no “trials” or one very big one.

• The Serious Adverse Events of mRNA Covid-19 Vaccine Trials (Demasi)

In December 2020, the US FDA authorised the Moderna and Pfizer mRNA covid-19 vaccines, claiming “the benefits outweighed the harms.” Now, a group of international researchers has gone back to re-analyse the original trial data upon which that claim was made. A pre-print study (not yet peer-reviewed) by Fraiman and colleagues contradicts the FDA’s claim that the benefits outweigh the harms of the mRNA vaccines. In fact, the authors conclude that the vaccines are associated with an “increased risk of serious adverse events” that surpass the “risk reduction for covid-19 hospitalisation” relative to the placebo group. The conclusion is provocative. While some have criticised the study for fuelling ‘anti-vax’ sentiment, many have welcomed the independent scrutiny of the trial data.

The researchers focused on analysing serious adverse events — specifically, they narrowed it to serious adverse events of “special interest” which were derived from a predefined list by the Brighton Collaboration, an established framework for vaccine safety used for over two decades. The advantage of this method is that it removes adverse events that are unlikely to be vaccine-related such as gunshot wounds and car accidents, thereby removing ‘noise’ from the analysis. They also pooled the trial data for the two mRNA vaccines which increased the sample size and achieved higher confidence in the results (more precision). The upshot of the analysis was that mRNA vaccines were associated with an absolute risk increase of serious adverse events of 12.5 per 10,000 vaccinated people (95% CI 2.1 to 22.9) over placebo.

Put another way, 1 in 800 people experienced a serious adverse event following either one of the mRNA vaccines (95% CI: 437 to 4762). “That is very high for a vaccine. No other vaccine on the market comes close,” says Martin Kulldorff, professor of medicine at Harvard (on leave) and former CDC vaccine safety committee member who was not involved in the study. Kulldorff says the closest any other vaccine on the US market comes to this is the MMRV vaccine which is no longer recommended for 1-yr-olds because they found the excess risk of febrile seizures was 1 in 2300 compared to separate MMR and Varicella vaccines (no excess risk in 5-yr olds). The Fraiman study found that coagulation disorders and cardiovascular problems were driving most of the serious adverse event in the trials, which seems to corroborate reports in the pharmacovigilance databases.

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“Every conversation that she described that she had with people from McCarthy to Ratcliffe to Cipollone never happened..”

• Cassidy Hutchinson Begged Trump Officials For ‘Financial Assistance’ (DC)

The Jan. 6 Committee’s key witness, Cassidy Hutchinson, asked former Senior Trump officials for financial assistance and legal help in February after she was subpoenaed by the committee, according to an email obtained exclusively by the Daily Caller. [..] “I was subpoenaed by the 1/6 Committee on November 9, 2020, but was not formally served until Wednesday, January 26, 2021. I’ve had difficulty securing a legal team, and was hoping you may be able to put me in contact with any fundraising organizations and/or attorneys that are involved in this process,” Hutchinson said in the email to the former senior Trump official. “My aunt and uncle applied to refinance their house to loosen up some money since I don’t have much immediate family, but they weren’t approved,” Hutchinson said in a separate email.

Multiple senior Trump officials and a person with first-hand knowledge told the Daily Caller that former White House Chief of Staff Mark Meadows would not answer Hutchinson’s calls after she was subpoenaed. A Meadows spokesperson confirmed those claims to the Daily Caller, saying Meadows didn’t return those calls to avoid the appearance of improperly influencing any testimony. [..] “Cassidy Hutchinson reached out to various people in Trump world asking for both financial assistance and help finding a lawyer. She told us she was in significant financial distress, had no family that could help, and couldn’t even afford food. She also told us Mark Meadows wouldn’t return her calls. To our knowledge, she spoke with multiple lawyers and chose Stefan Passantino to represent her,” a person with first-hand knowledge told the Daily Caller.

The person with first-hand knowledge also said that Trump officials were sympathetic because of her age and lack of employment and said at her request, Trump’s PAC agreed to help her financially and, at her request, suggested attorneys she could interview. The person also said Hutchinson made derogatory comments about the Jan. 6 committee to multiple people in Trump world. A former senior Trump official also mentioned Meadows not returning Hutchinson’s calls and said she reached out to Trump’s circle and asked for help. “She reached out to Trump world and was like, ‘Hey. The committee reached out to me. I really need help.’ She didn’t have a job. She didn’t have money to pay a lawyer. Trump has been trying to be really helpful, especially with young people who weren’t like bad actors on J6, like get you a lawyer. Pay for it. Meadows wasn’t returning her phone calls and like her circle of people, weren’t, like, helpful,” a former senior Trump official told the Caller.

[..] “She was in a horrible, she was in horrible shape financially. She had no employment prospects because like, you know, coming out of the Trump White House election wasn’t exactly, you know, a great line on the resume. And she was desperate,” the other Trump official told the Caller. “Every conversation that she described that she had with people from McCarthy to Ratcliffe to Cipollone never happened,” the official added. Another former senior Trump official told the Caller that Hutchinson was supposed to go work for Trump in Palm Beach, Florida, after leaving the White House and was stunned by Hutchinson’s testimony in front of the committee.

“She made it sound like all these people, I mean, I was in that West Wing, that these people basically were reporting to her and she was giving Meadows advice. And I’m like, What? I was there … But here’s the part that I do know firsthand she was supposed to take a job in Palm Beach,” the former senior Trump official said. “All I know. She was thrilled to go down there. Thrilled. Thrilled. This is after January 20!” the former official continued.

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“Facebook, in short, is utterly swarming with spooks.”

• The Ex-CIA Agents Deciding Facebook’s Content Policy (MacLeod)

It is an uncomfortable job for anyone trying to draw the line between “harmful content and protecting freedom of speech. It’s a balance”, Aaron says. In this official Facebook video, Aaron identifies himself as the manager of “the team that writes the rules for Facebook”, determining “what is acceptable and what is not.” Thus, he and his team effectively decide what content the platform’s 2.9 billion active users see and what they don’t see. Aaron is being interviewed in a bright warehouse-turned-studio. He is wearing a purple sweater and blue jeans. He comes across as a very likable, smiley person. It is not an easy job, of course, but someone has to make those calls. “Transparency is incredibly important in the work that I do,” he says.

Aaron is CIA. Or at least he was until July 2019, when he left his job as a senior analytic manager at the agency to become senior product policy manager for misinformation at Meta, the company that owns Facebook, Instagram and WhatsApp. In his 15-year career, Aaron Berman rose to become a highly influential part of the CIA. For years, he prepared and edited the president of the United States’ daily brief, “wr[iting] and overs[eeing] intelligence analysis to enable the President and senior U.S. officials to make decisions on the most critical national security issues,” especially on “the impact of influence operations on social movements, security, and democracy,” his LinkedIn profile reads. None of this is mentioned in the Facebook video.

Berman’s case is far from unique, however. Studying Meta’s reports, as well as employment websites and databases, MintPress has found that Facebook has recruited dozens of individuals from the Central Intelligence Agency (CIA), as well as many more from other agencies like the FBI and Department of Defense (DoD). These hires are primarily in highly politically sensitive sectors such as trust, security and content moderation, to the point where some might feel it becomes difficult to see where the U.S. national security state ends and Facebook begins. In previous investigations, this author has detailed how TikTok is flooded with NATO officials, how former FBI agents abound at Twitter, and how Reddit is led by a former war planner for the NATO think tank, the Atlantic Council. But the sheer scale of infiltration of Facebook blows these away. Facebook, in short, is utterly swarming with spooks.

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WEF-coordinated between several countries.

The discussion is priceless.

• Someone Tell The PM The World Needs More Fertilizer, Not Less (TSun)

The Trudeau government’s plan to reduce the use of fertilizers in Canada in the name of fighting climate change is the kind of thinking that globally applied, will lead to skyrocketing food prices and famine.It is another example of how Prime Minister Justin Trudeau’s mantra that the world must move ever faster away from the use of fossil fuels is increasingly becoming disconnected from reality because of rapidly changing global events.The problem right now is that the world needs more fertilizer, not less, for the same reason it needs more fossil fuel energy, not less.The severe shortage of both is happening for the same reasons — supply chain disruptions as countries try to recover economically from the COVID-19 pandemic, along with Russian President Vladimir Putin’s war on Ukraine.

Just as Russia is a major supplier of natural gas and oil to Europe, it is also the world’s largest producer of fertilizer. A global shortage of fertilizer — exacerbated by economic sanctions against Russian fertilizer and Russian export restrictions on fertilizer — is already contributing to higher prices, not just for the fertilizer needed by farmers to grow crops, but for the prices consumers pay for food at the grocery store. At least that’s the case in developed countries like Canada.For developing countries, it raises the spectre of famine. The real “green revolution” in agriculture, which started in the 1960s by making food production increasingly more efficient — in large part due to fertilizers — is literally keeping billions of people around the world alive today.

A global shortage of fertilizer, unless it is meaningfully addressed, will do the opposite over time.Enter the Trudeau government with a policy of reducing greenhouse gas emissions from fertilizers in Canada to 30% below 2020 levels by 2030. That’s an absurdly short time frame which is just as unrealistic as his target of reducing Canada’s greenhouse emissions to 40%-45% below 2005 levels by 2030 and to net zero by 2050. The Liberals, as well as the Conservatives, have never hit a single emission reduction target they’ve set over the past 34 years, and the reason is they set targets which are technologically unfeasible over and over again.

‘Nobody believes you’: Poilievre grills Trudeau as he testifies over WE Charity controversy

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This crazy video feels like a sign of these crazy times.

• DUCK AND COVER 2.0: Prepare for a Nuclear Attack (Celente)

The Ukraine War continues to escalate and America and NATO have vowed to do whatever it takes to defeat Russia. As we have forecast, the longer the war drags on, and the more weapons of death that are sent to Ukraine to keep bloodying the killing fields, the hotter it’s going to get, even to the point where there will be a nuclear exchange. Now the message being broadcast via the mainstream media is that the worst is yet to come, and they are warning the people, as they were during the Cold War, to “Duck and Cover.” Yesterday, New York City released a public service announcement warning the people that a nuclear bomb can be dropped and gave them idiotic and moronic instructions on what to do to save their lives after the bomb was dropped.


Assuming that they did not burn or melt in the initial blast, the New York City Emergency Management Department gave New Yorkers a three-step plan reminiscent of the duck-and-cover stupidity they sold the people at the height of the Cold War. The biggest takeaway: you really have to be a stupid dumbbell to swallow the crap from this shit show production. The short video, which looks like it was filmed on a Hollywood set, takes place on a partially bombed city street with a scene with damage that looks more Sesame Street than a nuclear apocalypse. Dressed in black, the presenter is the culturally perfect presenter in America’s dead-woke society. The actor playing the government mouthpiece role appears calm, almost like a flight attendant pointing to emergency exits on a plane and the only indication that something is amiss is the faint sound of sirens going on in the background.

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Led by Donkeys

 

 

 

 

Mahathir
https://twitter.com/i/status/1546003810253803521

 

 

 

 

 

 

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Debt Rattle June 7 2021

Jun 072021
 
 June 7, 2021  Posted by at 8:48 am Finance Tagged with: , , , , , ,  72 Responses »


Vincent van Gogh Daubigny’s garden 1890

 

• Was the Whole Pandemic About the Vaccine? (Mercola)
• Unthinkable Thoughts… (Josh Mitteldorf)
• ‘Damning’ Science Shows Covid-19 Likely Engineered In Lab: – Experts (NYP)
• Virologist Who Told Fauci Virus Potentially Engineered Nukes 5,000 Tweets (ZH)
• Fauci Told World Leaders Last Spring Virus Could Have Come From Wuhan Lab (DM)
• Ivermectin Confirmed As Covid Treatment By Bombay High Court (FSoir)
• California County COVID Death Toll 25% Lower After Counting Method Change (ZH)
• Children Are ‘Vulnerable Host’ For Covid As Cases Recede – US Expert (G.)
• Greek Minister Nods For Post-Vaccination Privileges (K.)
• ‘Pygmy Possum’ Leaders Impose One Punishing Lockdown After Another (RT)
• Oh Lordy, Yellen Comes Out for Higher Interest Rates (WS)

 

 

PCR sensitivity

 

 

“McCullough points out that a number of countries are already talking about making the as-yet unlicensed COVID-19 vaccine compulsory, meaning anyone and everyone can be forced to take it against their will.”

• Was the Whole Pandemic About the Vaccine? (Mercola)

In my opinion Dr. Peter McCullough is one of the most courageous well credentialed academic physicians out there and I hope to interview him soon. He is vice chief of internal medicine at Baylor University Medical Center and despite his impeccable credentials, he has been vilified for stating during the very beginning of the COVID-19 pandemic, that it was all about the vaccine and getting a global mass vaccination campaign underway. “All roads lead to the vaccine,” McCullough said in a recent interview with stakeholders banking on countries mandating the vaccine worldwide. McCullough points out that a number of countries are already talking about making the as-yet unlicensed COVID-19 vaccine compulsory, meaning anyone and everyone can be forced to take it against their will. “That’s how bad stakeholders want vaccination,” McCullough says. “They do want a needle in every arm. But why?” That’s the million-dollar question right there.

[..] Considering the U.S. Vaccine Adverse Events Reporting System (VAERS) has logged more deaths following COVID-19 vaccination than all available vaccines combined from mid-1997 until the end of 201316 — a period of 15 1/2 years — one has to wonder why our leaders are so insistent on everyone getting these experimental gene therapies. They’re even pushing for former COVID-19 patients to get the jab, even though they already have superior permanent immunity17 and studies show they have a far higher risk of severe side effects from the COVID jab. If it’s really about protecting the public against COVID-19, why aren’t recovered COVID patients — whose protection is far superior to vaccine-induced immunity — offered some sort of immunity passport or granted access to sporting events or education that is now only granted to those with vaccine certificates?

What’s more, North Carolina has now passed legislation that allows children as young as 12 to get the COVID vaccine without parental consent. Think about that. As of May 21, 2021, 4,406 Americans had died after the COVID vaccine including three teenagers and 12-year-olds are now being encouraged to make a life and death decision without their parents? As noted by McCullough, historically, the threshold at which an experimental vaccine program is shut down is 25 to 50 deaths, yet here we are, with over 4,000 deaths being reported in the U.S. and many thousands more in Europe.

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“..if it came from a laboratory (whether it leaked or was deliberately released) the spike protein might be actually be the agent of damage. There are several reasons to suspect that this is the case.”

• Unthinkable Thoughts… (Josh Mitteldorf)

The spike protein is the part of the virus structure that interfaces with the host cell. SARS 1 and SARS 2 viruses both have spike proteins that bind to a human cell receptor called ACE-2, common in lung cells but also present in other parts of the body. Binding to the cell’s ACE-2 receptor is like the wolf knocking at the door of Little Red Riding Hood’s grandmother. “Hello, grandmama. I’m your granddaughter. Please let me in.” The virus is a wolf wearing a red cape and hood, pretends to be an ACE-2 enzyme molecule seeking entrance to the cell. In order to enter the cell, the virus must break off from the spike protein and leave it at the doorstep, so to speak. This is an important and difficult step, as it turns out. Unique to the SARS-CoV-2 virus is a trick for making the separation. Just at the edge of the protein is a furin cleavage site.

Furin is an enzyme that snips protein molecules, and it is common in our bodies, with legitimate metabolic uses. A furin cleavage site is a string of 4 particular amino acids that calls to furin, “hey — come over here. I’m a protein that needs snipping.” The most compelling evidence for a laboratory origin of COVID is that coronaviruses don’t have furin cleavage sites, and until last year, this trick has never evolved naturally. The classical understanding of a viral or bacterial disease is this: A parasite is an organism that uses the host’s resources for its own reproduction. It is evolved to reproduce efficiently. If it has co-evolved with the host, it may be evolved to spare the host’s health, or even to promote it, because this is the optimal long-term strategy for any predator or parasite.

But newly-emerged parasites can do well for awhile even if they disable or kill their hosts, and this is the kind of disease that is most damaging to us. The damage is done because the (young) virus’s strategy is to reproduce rapidly and disperse itself into the environment where it can find new hosts. The virus has no interest in harming the host, and was not evolved to this end, but this is a side-effect of commandeering the body’s resources for its own reproduction. A bioweapon virus is designed to cause a certain kind of harm. What kind of harm? It depends on the projected use for the weapon. Doesn’t the virus have to reproduce? Probably, for most weapon applications; but a bioweapon is not necessarily designed for rapid reproduction. A bioweapon can be designed as a “sleeper” to remain dormant for months or years, or to cause incremental disability over a long period.

If COVID had evolved naturally, we would expect that its spike protein would be adapted to mate well with the human ACE-2 receptor. There’s no reason to suspect it being otherwise biologically active. But if COVID is engineered, it may be that the spike protein itself has been designed to make us sick. One reason this is significant is that the vaccines have all been designed around the spike protein, assuming that the spike protein were metabolically neutral. If the virus had been naturally evolved, this is a reasonable assumption. But if it came from a laboratory (whether it leaked or was deliberately released) the spike protein might be actually be the agent of damage. There are several reasons to suspect that this is the case.

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“Why did it replicate the choice the lab’s gain-of-function researchers would have made?”

• ‘Damning’ Science Shows Covid-19 Likely Engineered In Lab: – Experts (NYP)

“Damning” science strongly suggests that COVID-19 is a man-made monster, optimized in a lab for maximum infectivity before hitting the outside to catastrophic effect, two experts said Sunday. Writing in an opinion piece for The Wall Street Journal, Dr. Steven Quay and Richard Muller pointed to two key pieces of evidence to support the claim, which has increasingly gained steam after long being derided as little more than speculation. The first relates to the nature of gain-of-function research, in which microbiologists tweak a virus’ genome to alter its properties, such as making it more transmissible or more lethal.

Of the 36 possible genome pairings that can produce two arginine amino acids in a row — which results in boosting a virus’ lethality — the one most commonly used in gain-of-function research is CGG-CGG, or double CGG, wrote Quay and Muller. “The insertion sequence of choice is the double CGG,” wrote Quay, the founder of Atossa Therapeutics, and Muller, a former top scientist at the Lawrence Berkeley National Laboratory, who now teaches physics at the University of California’s Berkeley campus. “That’s because it is readily available and convenient, and scientists have a great deal of experience inserting it,” they wrote. “An additional advantage of the double CGG sequence compared with the other 35 possible choices: It creates a useful beacon that permits the scientists to track the insertion in the laboratory.”

The pair noted that the double CGG sequence has never been found naturally among the entire group of coronaviruses that includes CoV-2, which causes COVID-19. But, in what Quay and Muller called a “damning fact,” it was found in CoV-2. “Proponents of zoonotic origin must explain why the novel coronavirus, when it mutated or recombined, happened to pick its least favorite combination, the double CGG,” they wrote. “Why did it replicate the choice the lab’s gain-of-function researchers would have made?

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And then tweeted that it was an automated process.

• Virologist Who Told Fauci Virus Potentially Engineered Nukes 5,000 Tweets (ZH)

A California virologist who told Anthony Fauci that COVID-19 looks ‘potentially engineered’ and ‘inconsistent with expectations from evolutionary theory’ – only to later reverse course and publish a ‘natural origin’ paper 8 weeks later (before receiving a multi million-dollar NIH grant) has deleted more than 5,000 tweets. Kristian G. Anderson who runs the Andersen Lab in La Jolla, CA, wrote in a Feb. 1 email to Fauci “The unusual features of the virus make up a really small part of the genome, less than 0.1 percent, so one has to look really closely at all the sequences to see that some of the features (potentially) look engineered,” adding that he and his team found “the genome inconsistent with expectations from evolutionary theory.”

Anderson was responding to an article sent to him by Fauci exploring the origins of the virus. The next day, Fauci sent an urgent email to his deputy, Hugh Auchincloss, with the subject “IMPORTANT,” writing “Hugh, it is essential that we speak this a.m. Keep your cell phone on. … Read this paper as well as the email that I will forward. You will have tasks today that must be done.” The document attached was titled “Baric, Shi, et al – Nature medicine – SARS gain of function.pdf.” So right after one of Fauci’s trusted scientific advisers suggests COVID-19 could be man-made (while Fauci and associates publicly dismissed the possibility as a conspiracy theory), he shot a research paper concerning gain of function research – which Fauci was funding at the Wuhan Institute of Virology – to his deputy.

And now Anderson has deleted more than half of his tweets. Anderson claims that his old tweets are ‘auto deleted’ – which would suggest a rolling, automated process – not the sudden disappearance of over 5,000 tweets preceding March 7, 2021. The deleted tweets come as internet sleuths begin to unravel Anderson’s involvement with Fauci and the NIH.

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Is Gottlieb turning his back on Fauci?

• Fauci Told World Leaders Last Spring Virus Could Have Come From Wuhan Lab (DM)

The former head of the Food and Drug Administration, Scott Gottlieb, has said Dr. Anthony Fauci told world leaders in the spring of 2020 that the coronavirus may have escaped from a lab in Wuhan, China. U.S. researchers around that time still were considering whether the virus came from a lab break, and Fauci told the health leaders gathered that the newly identified strain of the coronavirus ‘looked unusual,’ according to Gottlieb. The disclosure from the former FDA chief comes as an increasing number of mainstream scientists and media figures no longer are parroting the line from the Chinese Communist Party that the virus came from a bat. Even President Joe Biden has ordered government agencies to investigate the possibility that it might have come from a lab.

Now, Gottlieb says Fauci last year at least considered that COVID-19 could have come from a lab – before closing ranks around the idea that it occurred naturally. Gottlieb, who served under President Donald Trump, said a former senior member of the Trump administration told him at the time of Fauci’s 2020 talk. Gottlieb said he’d recently reconfirmed with that person that Fauci had given the talk. ‘I think early on, when they looked at the strain, they had suspicions,’ Gottlieb recalled Sunday on CBS Face the Nation, speaking of U.S. scientists. ‘And it takes time to do that analysis, and that dispelled some of those suspicions,’ he added.

Meanwhile, Gottlieb said it was a mistake to only look at the virus from a scientific perspective: It also needs to be examined from a national security lens, he said. ‘A scientific mindset looks at the virus and the virus’ behavior and draws a conclusion,’ he said. ‘A national security assessment looks at that and then looks at the behavior of the Chinese government, the behavior of the lab, other evidence around the lab – including the infections we now know took place – and that changes the overall assessment,’ he said.

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Google translate.

• Ivermectin Confirmed As Covid Treatment By Bombay High Court (FSoir)

In India, the Ministry of Health included ivermectin as part of the treatment of Covid19 as early as April 2021 and confirmed this on several occasions, including in its last recommendation. The Minister of Health therefore did not follow the advice of the WHO not to use ivermectin . India, after a scientific review of the existing evidence, followed suit with Senegal, which had not followed the WHO advice on hydroxychloroquine with continuous use in combination with another molecule since March 2020.” We do not blindly follow the WHO” declared Prof. Moussa Seydi, head of the infectious diseases department at Fann hospital in Dakar.

As several Indian states continue to prescribe ivermectin with success, WHO chief scientist Soumya Swaminathan tweeted on May 10 that the United Nations agency advises against the use of the drug to treat patients with the disease. COVID-19, except in clinical trials. The tweet included a press release issued by the company that makes the drug, Merck, saying it had found no evidence to support the use of ivermectin in the treatment of COVID-19. The Indian Bar’s response was direct – a formal notice before action demanding accountability from the 51-page scientific director who takes up the various arguments in favor of ivermectin and especially questions why the scientific director tweeted a old Merck press release while on March 31, 2021 she herself issued a WHO opinion on ivermectin. This really raises questions.

A few weeks ago a group of Indian lawyers, whose sponsors are not yet identified, attacked the decision by the state of Goa to include ivermectin as part of the treatment against the Covid19 thus following national guidelines. The reasons given in the procedure were that the WHO had not approved the use of ivermectin. The Goa government has therefore produced a response brief thus confirming that the rationale for WHO’s advice not to use ivermectin is flawed. This thesis is based on a lot of evidence including the contradictory analysis of the WHO opinion made by the FLCCC of Dr Pierre Kory . It is therefore a first for a government to take a legal position in favor of early treatment.

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Easy as pie.

• California County COVID Death Toll 25% Lower After Counting Method Change (ZH)

The number of COVID-19 deaths in Alameda County, California, fell by about 25 percent after health officials changed their methodology for total mortality count, removing those that were not a “direct result” of the disease, or “in whom death caused by COVID-19 could not be ruled out.” The county’s COVID-19 dashboard, following an update on June 4 to reflect the total number of COVID-19 deaths using the state’s death reporting definition, shows 1,223 deaths were caused by the CCP (Chinese Communist Party) virus, 411 fewer than what it previously reported. “Alameda County previously included any person who died while infected with the virus in the total COVID-19 deaths for the County,” the county’s public health department said in a press release.

For example, someone who tested positive for the virus before dying in a car accident would still have been counted toward the COVID-19 death toll . “Aligning with the State’s definition will require Alameda County to report as COVID-19 deaths only those people who died as a direct result of COVID-19, with COVID-19 as a contributing cause of death, or in whom death caused by COVID-19 could not be ruled out,” the health officials said, noting that their system of reporting COVID-19 deaths on the dashboard and to the state was implemented early in the pandemic, before the state established guidelines for how deaths should be classified.

Alameda County Health Officer Dr. Nicholas Moss told the Mercury News that his department was aware of the inconsistency between the county and state’s numbers, but they had to put off the change because of a major surge in infections during the winter. “We just weren’t able to move as quickly on this as we would’ve liked, but we felt it was important and sometimes better late than never,” he said.

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Meant to sell vaccines, the article becomes an ad for Mississippi, 50th and last among states in vaccinations.

• Children Are ‘Vulnerable Host’ For Covid As Cases Recede – US Expert (G.)

A US public health expert has warned that though cases of Covid-19 are at their lowest rates for months and much of the country is returning to normal life, young Americans are still “a vulnerable host” for the coronavirus. Dr Richina Bicette, associate medical director at Baylor College of Medicine in Houston, told CNN children were now accounting for nearly 25% of US cases. “As adults get vaccinated and become more protected and immune,” she said, “the virus is still in the community looking for a vulnerable host and pediatric patients fit that description.” Children aged 12 and above are eligible to receive the Pfizer-BioNTech vaccine, one of three in US use. Federal authorities will this week debate extending vaccines to children aged 11 and under.

Centers for Disease Control and Prevention (CDC) data shows that 52% of the US population over the age of 12 has had at least one vaccine dose and 42% is fully protected. The Biden administration wants 70% of US adults to have received at least one shot by 4 July. A range of incentives are being offered. Deaths in the US have slowed drastically, the toll a little under 590,000. But with virus variants causing problems as other countries reopen, experts have voiced concern over slowing rates of vaccination, particularly in Republican states. On Sunday the Republican governor of Mississippi, Tate Reeves, appeared on CNN’s State of the Union. Mississippi is 50th and last among states in vaccinations, with 30% of residents fully protected and 40.5% aged 12 and older having received at least one dose, according to the CDC.

The states with the highest vaccination rates are Vermont (80.6% – with a Republican governor, Phil Scott), Hawaii (78.6%) and Massachusetts (76.8%). “I believe the vaccine works,” Reeves said. “I believe it’s safe. I believe it’s effective. I took my first dose in January, as did my wife, on TV live, and I have encouraged Mississippians to do the same. “But I also want to point out that President Biden’s goals for 4 July or otherwise are arbitrary to say the least.” Reeves said his focus was on providing “quality care” for people with Covid-19 – and trumpeted a steep decline in hospitalisations. “At our peak, we had 1,444 individuals in the hospital,” he said. “Today, we have 131. We’re down 90%. At our peak, we had 2,400 cases per day over a seven-day period. Over the last seven days, we have had barely 800 cases in total.

“And so, for that entire year period, the goalpost was, let’s reduce the number of cases. And we have been successful at doing that. The question is, why? “We have had a million Mississippians that have gotten the vaccine, but we have also had 320,000 Mississippians that have tested positive for the virus. Many people believe that somewhere between four and five times more people have gotten the virus that have not tested [positive]. “And so we have got probably a million or so Mississippians that have natural immunity. And because of that, there is very, very, very little virus in our state. But we’re still working to get the vaccine distributed, and hope we will continue to do so.”

Read more …

These people don’t know what they’re doing.

• Greek Minister Nods For Post-Vaccination Privileges (K.)

Greece may soon grant privileges to individuals inoculated against Covid-19. Speaking on Skai radio on Monday, Development Minister Adonis Georgiadis said such measures could be introduced only when vaccine supply has outpaced demand in the country. “We need to be certain that one did not get vaccinated because one did not want to do so, not because one could not schedule a [vaccination] appointment,” the conservative minister said. Georgiadis predicted that this would happen in the next two or three weeks. He did not specify what these privileges could be. In comments made on Sunday, Alternate Interior Minister Stelios Petsas also said that giving special privileges to vaccinated individuals could be used as an incentive to boost Greece’s nationwide inoculation program.

Read more …

“910 people in a population of 25 million have died from Covid-19, with just one single death – that of a returning traveller – in the last six months.”

• ‘Pygmy Possum’ Leaders Impose One Punishing Lockdown After Another (RT)

Having all but sealed the international borders until mid-2022, Oz reached a new high, or low, this week when Victoria, the most densely populated state, had a seven-day snap lockdown extended to a fortnight using the logic of one lockdown to prevent another lockdown, after alarm bells were raised when two people tested positive (later proven false positives) for the virus. Currently, there are 70 active cases of Covid in Victoria. Common sense went out the window. The state premier took refuge behind public health officials, just like everywhere else, citing a pressing need to crush a variant of the virus before it took hold. Melbourne’s four million residents were told to stay indoors for another week. The fourth lockdown for my home state, for a weary population that had already endured more than 100 gruelling days of enforced isolation over summer.

The latest move is cruel, cowardly and downright stupid. But you won’t convince the politicians that they need to try some leadership, because they are cowering in fear from what they have come to fearfully refer to as “a beast,” despite the fact that just 910 people in a population of 25 million have died from Covid-19, with just one single death – that of a returning traveller – in the last six months. Right now, Australia’s more than 7,000 critical-care beds remain empty and just 17 people nationwide are lying in hospitals suffering from Covid infection. Yet still, the leaders are ramping up the fear.

[..] Queensland Premier Annastacia Palaszczuk raised the idea of a fervent regionalism when she declared the state’s hospitals were “for our people.” This meant that a seriously ill woman pregnant with twins who lived in New South Wales was denied urgent medical treatment by her nearest hospital because it lay across the state border in Queensland. She lost one of her unborn babies thanks to political grandstanding. Only the politicians of Sydney, the New South Wales capital, have come out of this with any sort of credit seemingly determined to live with the disease and a staunch refusal to panic. Now that’s the Aussie spirit! Because elsewhere, it really does appear that crushing Covid-19 infection is the only thing that matters, despite the numbers of people who are vaccinated or even if anyone is even sick.

Read more …

Is it that they know it’s inevitable, so they might as well act as if they wanted it?

• Oh Lordy, Yellen Comes Out for Higher Interest Rates (WS)

Starting in 2018, President Trump harangued and hammered Fed Chair Jerome Powell to end Quantitative Tightening and to cut interest rates, and Powell buckled and did his infamous “180.” And now suddenly – unless this gets walked backed again tomorrow – we’ve got the opposite. Treasury Secretary Janet Yellen said in an interview with Bloomberg News on Sunday that higher interest rates would “actually be a plus for society’s point of view and the Fed’s point of view.” Under Fed Chair Yellen, the Fed hiked interest rates five times, starting in December 2015. Yellen departed in February 2018 as Trump had refused to reappoint her, and instead replaced her with Powell. At the time, the sixth rate-hike was already baked in for the March 2018 meeting. She is no stranger to rate hikes.

Now Yellen – presumably with the backing of President Biden – is supporting Powell on rate hikes, which is a dramatic shift from the prior administration. The issue in the interview was inflation and whether or not it would be fired up further by the federal government’s $4 trillion additional spending spread over 10 years, adding $400 billion per year in extra spending. Yellen said that this would not be enough for inflation to over-run. And she said that the current “spurt” in prices powered by the stimulus would fade next year – toeing the line that the biggest burst of inflation in three decades that blew through the Fed’s target by a big margin would just be “temporary.”

But, and here it comes: If the current burst of inflation turns out to be not temporary and triggers more persistent inflation, and thereby higher interest rates, it would be a good thing. “If we ended up with a slightly higher interest rate environment, it would actually be a plus for society’s point of view and the Fed’s point of view,” she told Bloomberg News. “We’ve been fighting inflation that’s too low and interest rates that are too low now for a decade,” she said. “We want them to go back to” a normal interest rate environment, “and if this helps a little bit to alleviate things then that’s not a bad thing – that’s a good thing.”

Read more …

 

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Debt Rattle January 27 2020

Jan 272020
 
 January 27, 2020  Posted by at 9:55 am Finance Tagged with: , , , , , , , , , ,  28 Responses »


Lewis Wickes Hine A heavy load for an old woman. Lafayette Street below Astor Place, NYC 1912

 

• China Extends Holiday, Businesses Shut As Virus Toll Rises To 81 (R.)
• Coronavirus Latest: Over 2,800 Global Cases Resulting in 80 Fatalities (ZH)
• Coronavirus: 100,000 May Already Be Infected, Experts Warn (G.)
• Chinese Nurse Says 90,000 Already Infected (ZH)
• WHO To Hold Special Meeting In Beijing As Death Toll Jumps (G.)
• Bolton’s Manuscript Leaks On Same Day Amazon Sales Begin (Fox)
• Fed Trying to Stop Global Economic Contagion – Martin Armstrong (USAW)
• ECB’s Knot: Don’t Expect Real Change In Rates In Coming Years (R.)
• French NGOs, Local Authorities Take Court Action Against Oil Giant Total (G.)
• Locust Swarms The Size Of Cities (AP)
• Julian Assange: ‘Unofficial’ Solitary Confinement as Torture (Cross)

 

 

Going through the latest corona numbers today, mostly released at midnight local time by the Beijing government, we now have:

• 81 deaths (round numbers, up 25 from yesterday, previous 2 days were both up 15)

• 2,744 infected (bit less than the 3,390 predicted by the Fibonacci sequence, but there’s a new category):

• 5,794 suspected infections (if only half are confirmed, this would blow Fibonacci out of the water)

• 461 critical patients

• reports of 90,000-100,000 infected in Wuhan (see articles below) and virus is spreading fast beyond Wuhan

• reports of 5 million Wuhan residents having left the city for the holiday, prior to the lockdown

Moreover, as Tyler remarked on Twitter: “Coronavirus mortality rises above 5% with 76 dead on 1,423 confirmed Hubei cases. Was 2% three days ago.”

Numbers from Beijing:

And the Fibonacci numbers again:


Fibonacci

Another 3-4 days of holiday. What good can it do with that 2-week incubation time? One thing is sure: it’s going to hurt the economy: “On Saturday, overall transportation dropped by 28.8% from the same day last year. Railway transportation fell by 41.5%, roads 25% and passenger flights 41.6%.”

• China Extends Holiday, Businesses Shut As Virus Toll Rises To 81 (R.)

The death toll from a coronavirus outbreak in China rose to 81 on Monday, as the government extended the Lunar New Year holiday and more big businesses shut down or told staff to work from home in an effort to curb the spread. Chinese Premier Li Keqiang visited the central city of Wuhan, the epicenter of the outbreak, as the government sought to signal it was responding seriously. But Asian shares tumbled, with Japan’s Nikkei average sliding 2.0%, its biggest one-day fall in five months, as investors grew increasingly anxious. Demand spiked for safe-haven assets such as the Japanese yen and Treasury notes. The total number of confirmed cases in China rose about 30% to 2,744, with about half in Hubei province, whose capital is Wuhan.


As worries grew around the world, Chinese-ruled Hong Kong, which has had eight confirmed cases, banned entry to people who had visited Hubei in the past 14 days. The ban did not cover Hong Kong residents. The nearby gambling hub of Macau, which has had at least one case of the flu-like virus, imposed a similar ban on those arriving from Hubei, unless they can prove they are virus-free. The city of Haikou on Hainan island in southern China said tourists from Hubei would be quarantined for 14 days. “Hubei people are getting discriminated against,” a Wuhan resident complained on the Weibo social media platform. The number of deaths from the virus in Hubei climbed to 76 from 56, health officials said, with five deaths elsewhere in China.

Read more …

Slightly different numbers here and there, but the trend is clear:

• Coronavirus Latest: Over 2,800 Global Cases Resulting in 80 Fatalities (ZH)

• In China there are now 2,744 confirmed cases as of 1200am on Jan 27, an increase of 39% resulting in 80 deaths, up 43%. This is triple the 916 mainland China cases reported late on Friday. Across the globe, there are now 2,807 confirmed cases and 80 Chinese fatalities, as so far nobody outside of China has died from the disease (that we know of).

• Some very unpleasant math: in China’s Hubei province where Wuhan is located, epicenter of the coronavirus breakout, there have been 1,423 cases and 76 deaths, resulting in a mortality rate of over 5%.

• 5th US Coronavirus infection confirmed by CDC in 4 states (AZ, CA, IL, WA)

• Incubation is asymptomatic, contagious, and can be as long as 14 days

• 5 million may have left Wuhan for Lunar New Year

• 1st case was Dec 1 NOT Dec 31 so infect pop may be much bigger

• 3 Beijing hospitals using AIDS drugs to treat virus

[..] the outbreak-related news out of China went from bad to worse on Sunday, as Wuhan’s Mayor not only informed the public that he suspects the number of cases in the city to increase by a considerable margin (as we mentioned below), but also that some 5 million residents of Wuhan – roughly half of the city’s population – had already left the city before the quarantine was fully implemented. Some left early last week for the lunar new year holiday, while others fled after learning about Beijing’s plans to cut off the city from the outside world (except for the flow of personnel and supplies needed to fight the outbreak). Anybody who tries to leave Wuhan on Sunday will find the roads blocked and guards ordering them to turn back.

The barricade, at one of the tolls for highways exiting the city, was blocked with red and yellow plastic barriers and cones. “Nobody can leave,” a policeman told AFP. But that’s far from the only disturbing news to emerge in the past few hours. To try and assuage citizens’ frustration about the virus overshadowing the LNY holiday, Beijng announced an extension of the holiday. That should take a bigger bite out of China’s GDP as factories, offices and government services will remain shuttered – but ideally China’s battered travel and tourism industry might be able to make up for some of the hit. As we noted earlier, Suzhou, a factory hub, was the first city to announce a holiday-like shutdown of industry until Feb. 8. China’s top transportation official confirmed on Sunday that travel has plummeted for the holiday. On Saturday, overall transportation dropped by 28.8% from the same day last year. Railway transportation fell by 41.5%, roads 25% and passenger flights 41.6%.

After the third case was confirmed in California on Sunday, health officials in Virginia have announced that three patients suspected to have contracted the virus are under observation, according to Fox. More alarmingly, a student at Connecticut’s Wesleyan University is being monitored for the virus after reporting a fever and a cough. Though it has yet to be confirmed, this underscores the difficulty in stopping the spread of the virus to the US, as Chinese students return to their American schools for the new semester, as the Hartford Courant reports. More suspected cases have been reported in California and Texas (though the Texas cases have mostly been cleared).

Read more …

Neil Ferguson. Note: no separate reports on infection rates among children.

• Coronavirus: 100,000 May Already Be Infected, Experts Warn (G.)

About 100,000 people could be infected with the new coronavirus around the world, experts have warned, as the UK government faced calls to reassure people that the NHS is ready to deal with any British cases within days. Prof Neil Ferguson, a public health expert at Imperial College, said his “best guess” was that there were 100,000 affected by the virus even though there are only 2,000 confirmed cases so far, mostly in the city of Wuhan in China where the virus first appeared. “Sooner or later we will get a case,” he said. “There are very large numbers of Chinese tourists across Europe right now. Unless the Chinese manage to control this, and I’m sceptical about whether that is possible, we will get cases here.”

Ferguson, whose team have been modelling the disease for the World Health Organization, said they estimated the virus had a reproductive rate of 2.5-3, meaning that each person infected would potentially transmit it to up to three others. “My best guess now is perhaps 100,000 cases right now,” he said, although it could be between 30,000 and 200,000. “Almost certainly many tens of thousands of people are infected.” Most of the cases that have been exported to other countries from China have been mild, he said. That could mean mild cases of disease spread more easily than severe, life-threatening cases, which sounds like good news. But on the other hand, it means it is possible there will be a reservoir of mild disease in the country that goes unnoticed and can spread until it affects somebody vulnerable because of underlying poor health, who becomes seriously ill.

“People looking for people with a travel history to China are not necessarily looking in their local population,” he said. There is a lot still unknown, he explained. “We don’t have reports as yet as to the extent to which children are becoming infected, probably because of the bias towards severe cases.” Unlike Sars, which made everyone who contracted the virus severely ill, the new virus appears to be able to slip under the radar, he said. Firstly, there are the many mild carriers, who will infect other people without necessarily being recognised. Secondly, there are reports from China of people who have infected others before they have experienced any symptoms.

Ferguson said it was possible this is not quite as it appears. It may be that the authorities have not actually identified the index case – the person who infected a group of people – making it look as though they picked up the virus from someone who had no symptoms.

Read more …

This is from a few days before Ferguson gave his 100,000 infected estimate. The lack of medical supplies is also noteworthy. Stories about “amateur” equipment.

• Chinese Nurse Says 90,000 Already Infected (ZH)

A viral video, reposted on Twitter 48 hours ago, has more than 800k views and reveals an urgent message from a Wuhan nurse, who claims more than 90,000 people in China have been infected with the fast-spreading coronavirus. An unverified translation of the nurse, posted by @purplelovehime, has been retweeted more than 13.7k times since Saturday, states: “I am Jin Wei. I am currently inside the Wuhan outbreak region, Han Hou area. I would like to describe the condition inside the Hubei province, as well as the outbreak situation in the entire China. Currently, there are already 90,000 cases of pneumonia contraction.”

“What is the rate of contraction? If one person contracted this disease and is not properly quarantined and treated, this I individual will infect 14 people that came in contact with him. That is a significant multiplier. During the spring festival, in our culture, families like to get together, dine together. But this is unlike any other years. I hope that people can stay home, do not gather, and do not visit families. There is a spring festival every year. If everyone can stay safe, you can always get together later,” the unverified translation of the nurse said. The translation went on to say that medical supplies from bio suits, medical masks, goggles, and gloves “are in great shortages.”

The nurse, in an emotional plea, said everyone in Wuhan and surrounding cities to “not go out! Stay home!” The translation ended with the nurse delivering some “very bad news:” “The coronavirus has mutated. It is now a second-generation virus. When it was still in its first generation, we were still able to treat this… However, after the last mutation, it became deadly… The rate of infection are now increasing exponentially. So please remember do not go out, do not visit people, do not gather in a group, do not have dinner party.”

Read more …

60 million under lockdown now? hard to keep track.

• WHO To Hold Special Meeting In Beijing As Death Toll Jumps (G.)

The head of the World Health Organisation will hold a special meeting with officials in Beijing on Monday to discuss how to contain the coronavirus that has killed 80 people and left more than 400 in a critical condition. In an effort to reduce chances of infection during what is China’s busiest travel season, officials announced the end of this week’s lunar new year holiday would be postponed until at least 2 February. Authorities have also widened sweeping restrictions that have curbed the movement of tens of millions of people. A total of 17 cities are now under lockdown, with several areas banning long-distance bus services, including Beijing, Shanghai and the eastern province of Shandong, home to 200 million people.


On Monday, Chongqing municipality, which has a population of 30 million, adopted similar measures. The municipality borders Hubei province, where the vast majority of deaths, have been recorded. The suspension of long-distance bus services, the cheapest way to travel, is likely slow down the return of millions of migrant workers who have visited their families over the lunar new year. By postponing the end of the holiday to Sunday from Friday, officials hoped to “effectively reduce mass gatherings” and “block the spread of the epidemic,” a cabinet statement said. Many of China’s big retail chains have also said they will temporarily close their stores, while some online businesses and banks have advised employees returning from Hubei province to work from home.

Read more …

As the “trial” restarts today, Bolton will hover in the background. From the Dems’ worst enemy to their best hope.

Aaron Maté: “Bolton news is fuzzy. Bolton isn’t saying Trump tied Ukraine weapons $ to opening a Burisma/2016 probe. Bolton says Trump wanted Ukraine to “[turn] over all materials they had about the Russia investigation that related Mr. Biden & and supporters of Mrs. Clinton in Ukraine.” Huh?”

• Bolton’s Manuscript Leaks On Same Day Amazon Sales Begin (Fox)

Former national security advisor John Bolton’s team was under fire from conservative commentators Sunday night, after a report in The New York Times revealed a bombshell excerpt from Bolton’s forthcoming book that could prove pivotal in President Trump’s impeachment trial — just as the Amazon product page for the book went live. The drama began earlier Sunday when the Times exclusively reported that Bolton’s manuscript included a claim that Trump explicitly linked a hold on Ukraine aid to an investigation of Joe and Hunter Biden. Trump told Bolton in August, according to a transcript of Bolton’s forthcoming book reviewed by the Times, “that he wanted to continue freezing $391 million in security assistance to Ukraine until officials there helped with investigations into Democrats including the Bidens.”

The Times further claimed Bolton had shared a manuscript of his forthcoming book with “close associates” — prompting Bolton’s team to deny the claim, and assert that the National Security Council’s [NSC’s] review process of pending manuscripts is “corrupted” and prone to leaks. A “pre-publication review” at the NSC is standard for any former government officials who held security clearances and publicly write or speak publicly about their official work. The review typically would focus on ferreting out any classified or sensitive material in advance of publication, and could take from days to months.

Conservatives, however, suggested Sunday evening that Bolton’s team may have leaked the information themselves while using the media as unwitting tools to juice their book sales. Online merchants began taking orders for Bolton’s book, entitled “The Room Where It Happened,” just as the Times’ story broke, with a March release date. Sarah Tinsley, a senior adviser to Bolton, told Fox News he had submitted a hard copy draft of his manuscript to the NSC several weeks ago for “pre-publication review,” but had not shared it with anyone else. The NSC is the White House’s internal national security and foreign policy arm.

[..] “Just like James Comey, John Bolton is trying to get rich off of a lie- and leak-fueled campaign to overturn the 2016 election results,” wrote The Federalist’s Sean Davis.”I suspect it will work out as well as all of Bolton’s other wars.” Davis added: “John Bolton is running the exact same revenge playbook against Trump that James Comey used. He’s even using the same agent and leaking to the same reporters. All because he’s mad Trump fired him for leaking and trying to start new wars. It’s so boring and predictable. … If you think anyone other than Bolton’s lawyer, publisher, or agent leaked this to 1) juice sales of his book, and 2) get revenge against Trump for firing Bolton and refusing to start a bunch of new wars, you’re an idiot.”

Read more …

You don’t think they’ve given up yet?

• Fed Trying to Stop Global Economic Contagion – Martin Armstrong (USAW)

Legendary geopolitical and financial analyst Martin Armstrong says, “The Fed is trapped. If it stops (injecting money into the repo market by billions of dollars daily), interest rates will rise.” Armstrong goes on to explain, “The Bank of Japan came out and said we’re going to buy government bonds unlimited. They, too, are trying to prevent interest rates from rising. . . . The ECB cannot afford rates to go up. . . . This is a global contagion that’s developing, and it’s pretty serious. The rise in interest rates has tremendous implications all the way around the globe. . . . Interest rates are rising because there is increased risk – period.” The big risk, according to Armstrong, is global governments, including the U.S., Armstrong says.

“You have to understand, at some point in time, capital begins to figure out who is the greatest risk, and the risk is government. At that stage in the game, when that point is reached, then you have shifts. The capital will move from public types of investments, such as government bonds and things of that nature, and then will move into the private sector. That’s equities, and that can be gold and real estate in different places. You try to go to tangible assets.” So, what could go wrong with the Fed trapped in the repo market and cannot stop liquefying bad debt? Armstrong says, “What can go wrong is that they lose the game. They are doing this to try to prevent interest rates from rising. If they did not do this, the short term rate would be up dramatically.”

What could go wrong is the Fed can continue to fuel the repo market with cheap money and interest rates can rise anyway? Armstrong says, “Correct. They have already lost control, otherwise they wouldn’t be doing this. . . .They are trying to keep rates down. If the Fed loses, rates are going to go up, and you are going to see this in the Treasury auctions. Then it won’t matter what the Fed is trying to do in the repo market. You will see this stress in the Treasury auctions, and the government will have to start paying higher prices. This is what’s going to take place.”

Read more …

The ECB is using Bernanke’s “savings glut” boondoggle to destroy your savings and pensions. Lagarde said it very clearly: jobs are better than savings.

What actually IS happening is they protect bankers’ profits by annihilating (your) savings in a broad sense. Pitchforks!

• ECB’s Knot: Don’t Expect Real Change In Rates In Coming Years (R.)

European Central Bank policymaker Klaas Knot on Sunday said he does not expect interest rates to fundamentally change in the coming years. “I don’t see any move towards fundamentally different rates in the coming years,” Knot said in an interview with Dutch television program Buitenhof. Rates could go up again in the future, the Dutch central bank governor said, but for now are being kept historically low by an abundance of savings and by a structurally low inflation rate in the euro zone. Knot also warned of the lingering threat of a ‘no-deal’ Brexit at the end of this year, which he said could lower economic growth in the Netherlands by 0.5%. “The imminent threat of a no-deal Brexit on Jan. 31 is negligible”, Knot said. “But the Brexit risk has only been postponed, as it seems impossible to have a comprehensive trade agreement that includes financial services in 11 months.”

Read more …

This might work in France. But how about the EU?

• French NGOs, Local Authorities Take Court Action Against Oil Giant Total (G.)

An alliance of 14 French local authorities and several NGOs will take unprecedented court action this week against the French oil firm Total to try to force the firm to drastically reduce its greenhouse gas emissions. It is the first climate change litigation against a private company in France. Campaigners want the court to ensure Total does more to curb its emissions. Total is on the list of top 20 global fossil fuel companies whose joint exploitation of the world’s oil, gas and coal reserves can be directly linked to more than a third of all greenhouse gas emissions in the modern era, according to analysis last year. The towns and local authorities that have brought the case range from Bayonne, in the south-west, to La Possession, on Réunion island in the Indian Ocean, and Sevran, north of Paris.

They argue that the climate emergency is already being felt by ordinary citizens and not enough is being done by large firms. Under a French law called the duty of vigilance, large companies must set out clear measures to any prevent human rights violations or environmental damage resulting from their activities. The non-governmental organisations bringing the case said Total had not included enough substantial detail in its vigilance plan to curb emissions, and the firm was out of step with the Paris climate agreement’s goals on limiting global heating. On Tuesday, a court summons will be made in Nanterre, outside Paris.

Sandra Cossart, the head of Sherpa, a French NGO working on economic transparency and corporate-related human rights, said: “It’s the first climate litigation in France against a private company, and it aims to change that company’s strategy in terms of greenhouse gas emissions.” Sandra said that under the duty of vigilance law, “Total is legally required to identify the risks resulting from its contribution to global warming and to take the necessary measures to reduce its emissions.” She said the case was an “important moment” to show that big companies have to step up on the climate emergency. “The more impact you have, the more responsibility you have.”

Read more …

Best line of the day: “Even cows are wondering what is happening..”

“One especially large swarm in northeastern Kenya measured 60 kilometers long by 40 kilometers wide (37 miles long by 25 miles wide).”

• Locust Swarms The Size Of Cities (AP)

The worst outbreak of desert locusts in Kenya in 70 years has seen hundreds of millions of the bugs swarm into the East African nation from Somalia and Ethiopia. Those two countries have not had an infestation like this in a quarter-century, destroying farmland and threatening an already vulnerable region with devastating hunger. “Even cows are wondering what is happening,” said Ndunda Makanga, who spent hours Friday trying to chase the locusts from his farm. “Corn, sorghum, cowpeas, they have eaten everything.”

When rains arrive in March and bring new vegetation across much of the region, the numbers of the fast-breeding locusts could grow 500 times before drier weather in June curbs their spread, the United Nations says. “We must act immediately,” said David Phiri of the U.N. Food and Agricultural Organization, as donors huddled in Kenya’s capital, Nairobi, a three-hour drive away. About $70 million is needed to step up aerial pesticide spraying, the only effective way to combat them, the U.N. says. That won’t be easy, especially in Somalia, where parts of the country are in the grip of the al-Qaida-linked al-Shabab extremist group.

Even a small swarm of the insects can consume enough food for 35,000 people in a single day, said Jens Laerke of the U.N. humanitarian office in Geneva. Farmers are afraid to let their cattle out for grazing, and their crops of millet, sorghum and maize are vulnerable, but there is little they can do. About 70,000 hectares (172,973 acres) of land in Kenya are already infested. [..] A single swarm can contain up to 150 million locusts per square kilometer of farmland, an area the size of almost 250 football fields, regional authorities say. One especially large swarm in northeastern Kenya measured 60 kilometers long by 40 kilometers wide (37 miles long by 25 miles wide).

Read more …

Quite afew comments on this, but I would be careful linking street protests to changes in Julian’s conditions. The imates may have helped.

• Julian Assange: ‘Unofficial’ Solitary Confinement as Torture (Cross)

The sustained violation of the human rights of Wikileaks founder, Julian Assange, has been carried out in full view of the world throughout his arbitrary detention in HMP Belmarsh. Until now, condemnation of his treatment and pleas to end his suffering have been met with denial and silence by the British authorities. But the announcement this week that Assange has been moved out of Belmarsh healthcare unit where he has been detained in solitary confinement since May, is a sign that the campaign to stop his persecution is gaining traction.

Also of significance is the involvement of his fellow inmates in helping to secure Assange’s release from solitary confinement, which suggests that within the walls of Belmarsh it is understood that the healthcare unit has been weaponized to arbitrarily isolate and punish a prisoner. Moving Assange from solitary confinement shows a shift from official government position that solitary confinement ‘does not exist’ Until now the British authorities have not only denied that Assange has been detained in solitary confinement, but that solitary confinement is not practised in British prisons.

In an attempt to mitigate growing public outrage, Her Majesty’s Prison and Probation Service (HMPPS) has been sending out letters in response to the influx of complaints it has been receiving regarding the abuse of Assange. In its response it refuses to address his case and produces a list of standards and laws written for the protection of prisoners as evidence he is in ‘safe hands.’ However, anyone who has followed the continued arbitrary detention of Assange in Belmarsh will know he has been placed effectively outside the reach of laws and standards; even access to his lawyers and legal documents, normally preserved by statutory prisoner rights – has been harshly restricted, all of which has had a crippling effect on preparation for his defence in a case of historical significance.

Read more …

 

https://twitter.com/i/status/1221454003491540992

 

 

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Debt Rattle December 23 2019

Dec 232019
 
 December 23, 2019  Posted by at 10:07 am Finance Tagged with: , , , , , , , , , , ,  8 Responses »


Mathew Brady Three captured Confederate soldiers, Gettysburg, PA 1863

 

• ECB’s Knot Says Low Rate Policy Risks Becoming Counterproductive (R.)
• Doomsday Debt Machine: Impeach Congress, Too! (Stockman)
• Nancy Pelosi: The Woman Who Stood Up To Trump (G.)
• Adam Schiff Has ‘No Sympathy’ For FBI Victim Carter Page (ZH)
• SmoCo Sneaks Home Amid The Ashes Of His Government (MB)
• Why Public College Should Be Free (Covert)
• London Will Never Give Independence – We Must Take It (Craig Murray)
• West Africa Renames CFA Franc But Keeps It Pegged To Euro (R.)
• Erdogan Says Turkey Can’t Handle New Migrant Wave From Syria, Warns Europe (R.)

 

 

Central banker who makes an excellent case against central bank interference in interest rates. But he doesn’t even get it himself, so how can a petty journalist? The idea that somehow magically conditions will (re-)appear that favor raising rates is as faulty as it is dumb. There is no way back. They’ve entered a black hole, they’ve crossed the event horizon.

• ECB’s Knot Says Low Rate Policy Risks Becoming Counterproductive (R.)

Interest rates in the euro zone could remain historically low for years, but the European Central Bank’s (ECB) ultra-loose monetary policy risks becoming counterproductive, ECB governing council member Klaas Knot said in an interview published on Monday. “I do not have a crystal ball, but I cannot rule out that the current low interest rate environment could last another five years”, Knot told Dutch newspaper De Volkskrant. “This worries me, because temporarily low interest rates are something quite different from persistently low interest rates.” The Dutch central bank president said the current low rates lead to excessive risk taking among investors, while younger generations on the other hand might feel forced to keep increasing their savings.


“From a macro-economic perspective that would be undesirable,” Knot said. “And it is also an example of how our low interest rate policy may eventually shoot itself in the foot. If people start saving more in response to the low interest rates, this will add further downward pressure on inflation.” Knot is a frequent critic of the ECB’s ultra-easy monetary policy, and slammed the bank’s new stimulus measures earlier this year as disproportionate. The Dutchman has repeatedly said he is looking forward to the strategic review of ECB policy, promised by its new President Christine Lagarde, and has called for the bank to adopt a more flexible inflation target. “The balance between positive and negative effects of the low interest rates is shifting in the wrong direction”, he told the paper.

Read more …

High crimes.

• Doomsday Debt Machine: Impeach Congress, Too! (Stockman)

If bringing one’s country to fiscal ruin were an impeachable offense, you’d have to impeach the entire city of Washington. On December 16 the gross Federal debt breached a new level to $23.1 trillion, while the net debt after $401 billion of cash weighed in at $22.71 trillion. The latter monstrous figure is notable because on June 30, 2019 it stood at $21.76 trillion. So what has happened in the last 167 days is a $948 billion increase in the Uncle Sam’s net debt, which amounts to a gain of $5.7 billion per day – including, as we like to say, weekends, holidays and snow days.

Worse still, not a single dollar of that gain got absorbed in government trust funds. The Treasury float held by the public actually rose by $953 billion. So why in the world do the knuckleheads on bubblevision not understand where the spiking rates and ructions in the repo market came from? The law of supply and demand is still operative, and the US Treasury is literally flooding the bond pits with new supply. Even at the bottom of the Great Recession, Uncle Sam did not drain $5.7 billion per day from the bond market.


But nary a soul down in the Imperial City has noticed this borrowing eruption at the tippy-top of the business cycle, which now teeters on borrowed time at a record 127 months of age. Instead, this very day the Congress is busily engaged in what is a fair approximation of abolishing the election process at the heart of American democracy. We will address today’s hideous impeachment Gong Show below. But here we note that every talking head showing up on the screen today is claiming that the market can keep on bubbling higher because the pending impeachment of the nation’s 45th president is a great big nothingburger. Au contraire!

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It’s not easy to even imagine, but there are people who see Pelosi as a hero. That they need to quote Leon Panetta to make that case should say enough. Still, after, Russiagate, Mueller, Ukrainegate, Pelosi refusing to send article to the Senate, this is just deaf, dumb and blind.

• Nancy Pelosi: The Woman Who Stood Up To Trump (G.)

In December 2018, weeks after the Democrats’ conquest of the House, the soon-to-be speaker arrived for a White House meeting with Donald Trump. The subject was a government shutdown but the subtext was a showdown between the most powerful woman in American politics and the president of the United States. In the extraordinary, televised exchange that followed, Trump sought to undermine Nancy Pelosi, whom he repeatedly addressed as “Nancy”, by reminding his audience in the Oval Office – and those watching at home – that she had yet to secure the 218 votes needed to reclaim the speakership and was “in a situation where it’s not easy for her to talk right now”. Her response was sharp and sure. “Mr President, please don’t characterize the strength that I bring to this meeting.”

It was the first test of a new power dynamic in Washington and when it ended, there was little disagreement over who had won. Pelosi emerged from the White House wearing a now-famous burnt-orange coat, sunglasses and the triumphant smile of a woman who has never forgotten the advice imparted to her by the late Louisiana congresswoman Lindy Boggs: “Darlin’, know thy power and use it.” That 15-minute Oval Office meeting marked the beginning of a struggle between Pelosi and Trump that culminated last week in the president’s impeachment by the House of Representatives for “high crimes and misdemeanors”. Pelosi, dressed in funeral black, banged down her speaker’s gavel to finalize the vote, binding together their legacies for all time.

It was not how Pelosi, who once said Trump was “not worth” impeaching, had hoped to end a year that began with her historic, second ascension to the speakership. Pelosi, the first – and only – woman ever to serve as Speaker of the House, would rather be remembered for legislative accomplishments – the Affordable Care Act above all – than for impeachment. But Trump, Pelosi said, left her “no choice”. She quoted Thomas Paine: “The times have found us.” In the wake of Trump’s impeachment, however, Democrats believe there was perhaps no leader better suited to the times. “She is, thank God, the exact right person in the right place at the right time,” said Leon Panetta, a former defense secretary and CIA director and a California native who’s known Pelosi for decades.

“I’m not sure anybody else would have had the experience or capability to be able to do what she has done.” “Donald Trump really has met his match with Nancy,” Panetta added. Her grace under fire as speaker has earned comparisons to Sam Rayburn, the country’s longest-serving speaker, who died in 1961. One Democrat called her an “as good or better” legislative leader than Lyndon Johnson, who was a Senate majority leader before he was president. And when the question is asked whether a female presidential candidate can beat Trump in 2020, the Democrats point to Pelosi, who “does it every single day”.

Read more …

It’s OK for the FBI to break the law 6 ways from Sunday because Schiff doesn’t like the guy they spied on. And it’s not even 2020 yet.

• Adam Schiff Has ‘No Sympathy’ For FBI Victim Carter Page (ZH)

Rep. Adam Schiff (D-CA) says it’s hard to feel sympathetic for former Trump campaign aide Carter Page, despite the fact that he was spied on by the FBI after the agency fabricated evidence to obtain a surveillance warrant from the Foreign Intelligence Surveillance Act (FISA) court. After the FISA court denied their request, FBI attorney Kevin Clinesmith fabricated evidence to exclude the fact that Page was a CIA source, with “positive assessment,” despite the fact that the CIA informed Clinesmith of Page’s prior work for the agency. Schiff, however, has no love for Page despite DOJ Inspector General Michael Horowitz finding 16 significant ‘errors’ in the FBI’s FISA applications used to surveil Page.


“I have to say, you know, Carter Page came before our Committee and for hours of his testimony, denied things that we knew were true, later had to admit them during his testimony,” Schiff told PBS News’ Margaret Hoover. “It’s hard to be sympathetic to someone who isn’t honest with you when he comes and testifies under oath. It’s also hard to be sympathetic when you have someone who has admitted to being an adviser to the Kremlin.” Hoover countered, noting “But then was also informing the CIA,” to which Schiff replies “Yes, yes.” “Which we didn’t know about,” replied Hoover. “Who was both targeted by the KGB but also talking to the United States and its agencies and that should have been included, made clear, and it wasn’t, according to the inspector general,” Schiff responded.

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When is the last time Australia had an actual politician? How is the entire country not a province for US and UK bankers to loot?

• SmoCo Sneaks Home Amid The Ashes Of His Government (MB)

There are moments in politics when everything that has come before is crystalised in a moment. Malcolm Turnbull branded himself a phony when he leapt into bed with the Coalition’s right wing. Tony Abbott captured himself when he recommended Prince Phillip be offered an Australian knighthood. Before him, John Howard made himself a political legend when he threw children overboard. Julia Gillard did it in her act of backstabbing. Kevin Rudd did it when he dumped climate change mitigation for Big Australia. Paul Keating branded himself forever with the “recession we had to have”. So on and so forth. These are moments when the truth about a leader’s character is revealed for all to see and branded that way forever more.

For Keating it was arrogance. For Howard it was opportunism. For Rudd it was narcissism. For Gillard it was illegitimacy. For Abbott it was archaic ineptitute. For Turnbull it was hollowness. That moment arrived last week for Scott Morrison. He will henceforth be remembered as SmoCo, the guy that fled to Hawaii – sand, sun and Mai Tais – as his nation burned to the ground. No doubt his minders will kid themselves that he can spin his way out of it. That the marketing guru will find a new angle to shift the blame elsewhere. They are wrong. The Morrsion Government is now covered in ash and forever will be. Over Christmas tables across the nation for the next week, SmoCo will be a combined laughing stock and object of incredulous anger.

SmoCo of the “quiet Australians” has become instead the incredible vanishing PM. In truth, it’s not all SmoCo’s fault. His party is really to blame. It has made destructive climate politics the centre of its value system for thirty years. It has unilaterally blockaded global action. It has embraced and defended carbon interests. It has ruined the debate with pseudo-science. It has trashed energy policy and twisted mitigation policy to such an extent that Australia now faces combined environmental and energy calamity. From day one, it has divided and conquered instead of uniting and acting.

Read more …

Another one of those discussions that cannot be avoided or ignored. Still, Sanders and Warren haven’t found the solution yet.

• Why Public College Should Be Free (Covert)

Nearly all of the Democratic presidential candidates have plans to reduce the exorbitant cost of college. But there’s an emerging rift: On one side, candidates like Elizabeth Warren and Bernie Sanders have proposed making public college free for all; on the other, candidates like Pete Buttigieg and Amy Klobuchar want to make it free for only a slice of the population. The latter worry that by providing free college to everyone who wants it—including, in Buttigieg’s words, “the children of millionaires and billionaires”—too many resources will be squandered on the rich. In reality, we already subsidize college for kids from wealthy families, and those further down the income scale would benefit the most if public institutions were free.

In 2017, the most recent year for which we have data, all of the tuition and fees charged by public colleges came to $75.8 billion. That’s less than what the federal government spends to subsidize the cost of college. In the same year, the government disbursed about $160 billion in the form of student loans, grants, and tax breaks to help make higher education less of a burden on American families. Certainly the students who take advantage of those federal funds use them to go to a variety of higher education institutions, not just public colleges. But it would be more efficient to simply eliminate public college tuition than to spend all that money propping up institutions through a maze of grants and tax breaks.

Right now, the government’s money flows largely to well-off students. After student loans, the biggest chunk of student aid is delivered through the tax code; excluding loans, it makes up more than half of all aid. In 2012 the federal government gave $34 billion in tax breaks, a billion more than it spent on Pell Grants for those in financial need. And most of that money is going to the wealthiest families. In 2013, for example, families that made $100,000 or more a year captured more than half of the tuition and fees deduction as well as the exemption for dependent students.

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Murray is a proud Scot.

• London Will Never Give Independence – We Must Take It (Craig Murray)

Yesterday the Scottish Government published “Scotland’s Right to Choose“, its long heralded paper on the path to a new Independence referendum. It is a document riven by a basic intellectual flaw. It sets out in detail, and with helpful annexes, that Scotland is a historic nation with the absolute and inalienable right of self-determination, and that sovereignty lies not in the Westminster parliament but with the Scottish people. It then contradicts all of this truth by affirming, at length, in detail, and entirely without reservation, that Scotland can only hold a legitimate Independence referendum if the Westminster Parliament devolves the power to do so under Section 30. Both propositions cannot be true. Scotland cannot be a nation with the right of self-determination, and at the same time require the permission of somebody else to exercise that self-determination.


I was trying to find the right words to discuss the document. One possibility was “schizophrenic”. The first half appears to be written by somebody with a fundamental belief in Scottish Independence, and contains this passage: “The United Kingdom is best understood as a voluntary association of nations, in keeping with the principles of democracy and self determination. For the place of Scotland in the United Kingdom to be based on the people of Scotland’s consent, Scotland must be able to choose whether and when it should make a decision about its future. The decision whether the time is right for the people who live in Scotland again to make a choice about their constitutional future is for the Scottish Parliament, as the democratic voice of Scotland, to make.”

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Colonialism takes many forms.

• West Africa Renames CFA Franc But Keeps It Pegged To Euro (R.)

West Africa’s monetary union has agreed with France to rename its CFA franc the Eco and cut some of the financial links with Paris that have underpinned the region’s common currency since its creation soon World War Two. Under the deal, the Eco will remain pegged to the euro but the African countries in the bloc won’t have to keep 50% of their reserves in the French Treasury and there will no longer be a French representative on the currency union’s board. Critics of the CFA have long seen it as a relic from colonial times while proponents of the currency say it has provided financial stability in a sometimes turbulent region.

“This is a historic day for West Africa,” Ivory Coast’s President Alassane Ouattara said during a news conference with French President Emmanuel Macron in the country’s main city Abidjan. In 2017, Macron highlighted the stabilizing benefits of the CFA but said it was up to African governments to determine the future of the currency. “Yes, it’s the end of certain relics of the past. Yes it’s progress … I do not want influence through guardianship, I do not want influence through intrusion. That’s not the century that’s being built today,” said Macron. The CFA is used in 14 African countries with a combined population of about 150 million and $235 billion of gross domestic product.

However, the changes will only affect the West African form of the currency used by Benin, Burkina Faso, Guinea Bissau, Ivory Coast, Mali, Niger, Senegal and Togo – all former French colonies except Guinea Bissau. The six countries using the Central African CFA are Cameroon, Chad, Central African Republic, Congo Republic, Equatorial Guinea and Gabon, – all former French colonies with the exception of Equatorial Guinea. The CFA’s value relative to the French franc remained unchanged from 1948 through to 1994 when it was devalued by 50% to boost exports from the region.

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Another attack on Assad, under a different guise. We eagerly await comment from Bellingcat and the White Helmets. And what’s that smell?

• Erdogan Says Turkey Can’t Handle New Refugee Wave From Syria, Warns Europe (R.)

Turkey cannot handle a fresh wave of migrants from Syria, President Tayyip Erdogan said on Sunday, warning that European countries will feel the impact of such an influx if violence in Syria’s northwest is not stopped. Turkey currently hosts some 3.7 million Syrian refugees, the largest refugee population in the world, and fears another wave from the Idlib region, where up to 3 million Syrians live in the last significant rebel-held swathe of territory. Syrian and Russian forces have intensified their bombardment of targets in Idlib, which Syria’s President Bashar al-Assad has vowed to recapture, prompting a wave of refugees toward Turkey.

Speaking at an awards ceremony in Istanbul on Sunday night, Erdogan said more than 80,000 people were currently on the move from Idlib to Turkey. “If the violence toward the people of Idlib does not stop, this number will increase even more. In that case, Turkey will not carry such a migrant burden on its own,” Erdogan said. “The negative impact of the pressure we will be subjected to will be something that all European nations, especially Greece, will also feel,” he said, adding that a repeat of the 2015 migrant crisis would become inevitable. He also said Turkey was doing everything possible to stop Russian bombardments in Idlib, adding that a Turkish delegation would go to Moscow to discuss Syria on Monday.

[..] Turkey is seeking international support for plans to settle 1 million Syrians in part of northeast Syria that its forces and their Syrian rebel allies seized from the Kurdish YPG militia in a cross-border incursion in October. Ankara has received little public backing for the proposal and has repeatedly slammed its allies for not supporting its plans. Turkey’s offensive was also met with condemnation from allies, including the United States and European countries. “We call on European countries to use their energy to stop the massacre in Idlib, rather than trying to corner Turkey for the legitimate steps it took in Syria,” Erdogan said on Sunday, referring to the three military operations Turkey has carried out in Syria.

After a global refugee forum in Geneva last week, the United Nations refugee agency said states pledged more than $3 billion to support refugees and around 50,000 resettlement places. But, Erdogan, who attended the forum, said on Sunday that sum was not enough. U.N agencies say hundreds of people have been killed in Idlib this year after attacks on residential areas. Russia and the Syrian army, which is loyal to President Bashar al-Assad, both deny allegations of indiscriminate bombing of civilian areas and say they are fighting al Qaeda-inspired Islamist militants.

Read more …

 

 

 

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Debt Rattle September 24 2019

Sep 242019
 
 September 24, 2019  Posted by at 9:12 am Finance Tagged with: , , , , , , , , ,  19 Responses »


Paul Gauguin Clovis Gauguin asleep 1884

 

• Why Repo Is Such a Big Deal, and Its $400 Billion Bailout So Unnerving (Fort.)
• Interest Rate Business Model is Dead (Welt)
• Discord At The Top Is Bad For The ECB (MW)
• Boris Johnson Refuses To Rule Out Suspending Parliament Again (G.)
• UK Labour Party Remains Split Over EU (CNBC)
• The Odor of Desperation (Kunstler)
• Why Is The Media Circling The Wagons To Protect Hunter Biden? (NYPost Ed.)
• Democrats Were First To Enlist Ukraine In US Elections (Solomon)
• Democrats Announce Tighter Criteria For Fifth Presidential Debate (R.)
• Google Wins Landmark Right-To-Be-Forgotten Case In Europe (BBC)
• US Government Moves To Block Alleged Drone Whistleblower’s Defense (SProof)

 

 

2 things:

1) the UK Supreme Court ruling on prorogation will come too late to include here.

2) I’m sorry that Greta Thunberg made me feel queasy yesterday. I know she means well, but it all came out very strangely in her speech. Could hardly bear to watch it. Who’s pushing her? To Davos first, and now the UN?

 

 

“..any counter-party in need of cash, and only holding collateral like Treasuries, agreed to pay the much higher going repo rates. That’s supply and demand..”

• Why Repo Is Such a Big Deal, and Its $400 Billion Bailout So Unnerving (Fort.)

Repos (short for repurchase agreements) are short-term borrowing transactions, often made overnight. Think of them as trades of cash for some kind of collateral. In a repo transaction, the borrower will sell certain securities in their possession with the agreement to buy them back the next day. If the transaction is not rolled over, then the trade has to be settled the following day, with the borrower repurchasing the collateral from the lender for slightly more than it had previously sold it for, compensating the lender with interest for taking on the risk. Large corporations and banks typically hold vast quantities of highly liquid financial assets, and so they like using these markets as a means of quick and easy financing.

In fact, there are more than $1 trillion worth of overnight repo transactions collateralized with US government debt occurring every day. Banks frequently go to these markets to fund the loans they issue, and to finance the trades they execute. That’s when it’s working smoothly. The repo market seized up last week, with median repurchase rates skyrocketing from their usual band of 2.00-2.25% to 2.46% on Monday, and 5.25% on Tuesday. Keep in mind, that’s the median rate. Some repo rates were as high as 9%, more than quadruple the Federal Reserve’s own target rate, which usually puts a cap on how high Treasury repo rates could climb.

An unlucky confluence of events, including an exceptionally large demand for cash from U.S. companies that needed to pay their corporate tax bills, sucked a lot of the available cash out of the financial markets. What happened last week was any counter-party in need of cash, and only holding collateral like Treasuries, agreed to pay the much higher going repo rates. That’s supply and demand, plain and simple, and it mirrors what happened in certain repo markets in 2007 before the housing crash and the Great Recession that followed.

Read more …

This is from an article by Anne Kunz and Holger Zschäpitz for Die Welt. Mish ran a Google translate which he corrected later.

I must say, the impression is too strong that Deutsche Bank and Commerzbank are in trouble only because of Draghi. That is simply not true.

And banks are not the main victims of low rates, savers and pensioners are.

• Interest Rate Business Model is Dead (Welt)

The cash cow bank lending model is dead, buried by the European Central Bank (ECB). The coup de grace came at the recent meeting. As ECB President Mario Draghi squeezed the negative interest rate for banks even deeper. The ECB will restart its bond purchase program in November. This time, without a time limit. Thus, the monetary authorities have permanently chained the long-term interest rate at a low level and cut the profit opportunities of the financial sector to a level that isn’t sustainable. For a long time, institutions have made good money from the difference between long-term and short-term interest rates.That time is now over.

In 2016, Commerzbank employed more than 50,000 people. CEO Martin Zielke wants to close one-fifth of the 1,000 branches and even wants to part with an important source of income including his Polish subsidiary MBank. The workforce should be reduced to around 38,000 by the end of 2020. The sale of Mbank is a desperate attempt at salvation. In terms of stock market value, Deutsche Bank and Commerzbank are now loosely hanged even by more regionally active institutions from Norway and Sweden. [That is a direct translation that reads wrong but I do not know how to fix it]. Even the once proud Landesbanken is a restructuring case. This is a dangerous development.

“With the allowance, the ECB has relieved the German banks in the short term by around 500 million euros. At the same time, banks will be burdened considerably by the continuation of the low interest rates for an indefinite period, “says Peter Barkow, financial expert at Barkow Consulting. “Especially the German banks are very much dependent on income from the long-term investment of customer deposits at higher interest rates, called maturity transformation. This strategy only works very limited, “warns the expert. [The allowance refers to the ECB not charging banks a portion of the negative interest on excess reserves]

However, the corresponding earnings impact on the banks will only be delayed. “Many German banks have to find new sources of income in the medium term. In the short term, a further reduction in costs will probably be necessary, “says Barkow. For more than a hundred years, banks lived on long-term lending or investing in securities their clients entrusted to them in the short term. Historically, banks made money out of time. If time no longer has a price, because there is no more interest, nothing can be earned. Ten-year Bunds yielded around 1.5 percentage points more than two-year issues in historical terms. Currently, the difference is just under 0.2 percentage points.

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Depends on Lagarde.

• Discord At The Top Is Bad For The ECB (MW)

The ECB on September 12 launched a new round of monetary easing, arguing that the decline of inflation expectations in the eurozone, triggered by the current economic slowdown, is throwing further doubt on its ability to reach its official target of “below but close to 2%”. The central bank not only resumed its asset purchases while lowering its key interest rate to minus 0.5%: It also, for the first time, declined to set a date for the end of the program, indicating only that it would be phased out once inflation is “robustly” back on the 2% track. The decision came after a heated debate on the governing council, which includes the 19 central bankers from the monetary union’s member countries and the ECB’s six-strong executive board. Even traditional doves, such as the council’s two French members, argued against the resumption of the bond-buying program.

As soon as the decision was announced, the fiercest opponents to the package went public with their frustration. German central bank President Jens Weidmann told the newspaper Bild that the package was “unnecessary.” The day before, the same newspaper had accused Draghi, dubbed “Count Draghila,” of “sucking dry” the accounts of German savers. Austrian central bank head Robert Holzmann told Bloomberg the package “may have been a mistake.” And Klaas Knot, the Dutch central bank chief, added that the package was “disproportionate.” The loose monetary policies initiated by ECB President Mario Draghi in the summer of 2012, less than a year after he took office, were always reluctantly accepted by eurozone central’s most hawkish members, even when they occasionally voted for some of the measures — such as the first round of bond-buying, back in 2014.

But it is the first time that the relative confidentiality of the governing council’s deliberations has turned into such a public airing of dirty monetary laundry.

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“..Johnson also categorically ruled out any sort of deal with Nigel Farage’s Brexit party..”

• Boris Johnson Refuses To Rule Out Suspending Parliament Again (G.)

Boris Johnson has refused to rule out suspending parliament again if the supreme court rules on Tuesday that he abused his powers as prime minister in doing so earlier this month. The British prime minister, who is in New York for a UN summit, also indicated he would not feel obliged to resign if the justices rule he misled the Queen in his reasons for suspending parliament. Asked if he felt a verdict going against him would make his position untenable, Johnson said: “No. I think the reasons for wanting a Queen’s speech are extremely good.” Speaking to reporters, Johnson also categorically ruled out any sort of deal with Nigel Farage’s Brexit party in the likely imminent election, saying the Conservatives would contest every seat.


The supreme court judgment, which could have a huge impact not just on Johnson’s future but also the wider ability of the courts to take a view in political decisions made by government, is due to be announced at 10.30am, following last week’s hearing. The panel of 11 judges were tasked with hearing appeals from two separate legal challenges to Johnson’s decision to prorogue parliament – the technical term for gaps in parliamentary sessions which do not involve dissolution before an election – for five weeks from 9 September.

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Corbyn’s attempts to not lose the Leave voters divide the party. Damned if you do…

• UK Labour Party Remains Split Over EU (CNBC)

Britain’s main opposition party has narrowly voted to maintain a neutral stance on the country’s most divisive topic, Brexit, after chaotic scenes at the party’s conference Monday evening prompted fresh criticism from both internal party activists and senior political opponents. Much of the party’s ordinary membership are in favor of the U.K.’s continued membership in the European Union, but Labour chief Jeremy Corbyn has long remained publicly ambivalent on the subject in a bid to hold his party and its supporters together ahead of an expected national election. But those efforts were severely tested as the party’s ruling body put forward a series of proposals on Brexit, many of which had been crafted by dozens of the local Labour constituencies over the course of several days.


Corbyn’s team had insisted that the party remain agnostic for now on whether the U.K. should leave or remain in Europe, and demanded that a final decision be made at another future meeting; at an undetermined time and after a putative election victory. [..] Those Labour activists and party officials who are concerned about those departing voters, and who also advocate remaining in the EU, had put forward a separate proposal Monday. It would have forced the party to adopt a clear policy in favor of continued EU membership, but it was marginally defeated in a vote of raised hands that even the meeting’s chairwoman acknowledged had been hard to judge with total certainty.

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And every second headline says impeachment again. Am I the only one getting tired of that?

• The Odor of Desperation (Kunstler)

The swamp abides. The latest news media dumpster fire over President Trump’s phone conversation with Ukrainian president Volodymyr Zelensky is a three-way ruse. Ruse 1: deflect attention from the main issue, which is Joe Biden’s trolling for payoffs on his missions to foreign lands as vice-president, first Ukraine, where son Hunter was gifted a board of director’s chair and $50K-a-month salary with Ukrainian gas company Burisma, and then a $1.5 billion “private equity investment” to Hunter Biden’s wealth management fund from the state-owned Bank of China. Ruse 2: to deflect attention from the damage soon to be inflicted on the Deep State by the forthcoming DOJ Inspector General’s report on FISA court abuses. Ruse 3. To set in motion yet another obstruction of justice trap for Mr. Trump on the basis of false charges.

This comes at the instigation of Intelligence Community Inspector General Michael Atkinson, who was formerly senior legal counsel to John Carlin head of the National Security Division of the Department of Justice, deeply implicated in the FISA court matters of 2016 under investigation by federal prosecutor John Durham. Mr. Atkinson cited a complaint by an unnamed whistleblower who claims to have heard from a source that the President offered a quid pro quo to Ukrainian President Zelensky for reopening the Burisma case. The “whistleblower” may be Mr. Atkinson himself. Of course, gaffe-prone Joe Biden spilled the beans on video earlier this year, when he bragged about shaking down Ukraine’s then-president Petro Poroshenko over a billion-dollar loan guarantee unless he fired the prosecutor investigating Burisma, which he did. Is there any ambiguity here?

The coordination between the news media and the Deep State is impressively blatant in this new gambit, with former acting FBI director Andrew McCabe (dismissed for cause in 2018), in his new position as a CNN “contributor” (while awaiting prosecution) teeing up a new “Trump collusion” narrative with The New York Times, WashPost, and NBC marching in step. In this new age of disinformation, narratives are the political weapon of choice in the campaign to harass and disable the winner of the 2016 election. The big play of RussiaGate failed, the play of “racism” is failing, so UkraineGate is next up.

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“Imagine the son was Eric Trump, and the politician Donald Trump. Would the media be dismissing it as nothing worth looking at, a “debunked” issue?”

• Why Is The Media Circling The Wagons To Protect Hunter Biden? (NYPost Ed.)

A foreign natural gas company brings a top US politician’s son onto its board, even though he has no relevant expertise, for $50,000 a month. The politician travels to that country and demands the removal of a prosecutor who’s investigating the company. That prosecutor then gets axed, and the investigation shut down. Imagine the son was Eric Trump, and the politician Donald Trump. Would the media be dismissing it as nothing worth looking at, a “debunked” issue? Yes, Ukraine’s chief prosecutor declared in May that he’d seen no evidence of wrongdoing by Joe or Hunter Biden. Of course not: Again, the investigation got closed years ago.

Yet Yuriy Lutsenko also basically told Bloomberg News he didn’t want to see any such evidence: “I do not want Ukraine to again be the subject of US presidential elections.” And Volodymyr Zelensky took over as Ukraine’s new president after that Lutsenko interview — having won on a vow to end Ukraine’s endemic corruption. Was it really so strange that President Trump pushed the reformer to reopen the probe? No, Trump hasn’t bathed himself in glory with his ham-handed pressure on Ukraine. Then again, Joe Biden’s boasts about getting that prosecutor axed also look clumsy. Then there’s Lutsenko’s claim that the Obama administration handed him a “do not prosecute” list in mid-2016, even as it was pushing Ukraine for dirt on Paul Manafort, Trump’s campaign manager.

That evidence eventually helped send Manafort to prison. What might come of a full-on Hunter Biden probe?

Read more …

“..the pressure began at least as early as January 2016, when the Obama White House unexpectedly invited Ukraine’s top prosecutors to Washington..”

“..What wasn’t known at the time, Shokin told me recently, was that Ukrainian prosecutors were preparing a request to interview Hunter Biden about his activities and the monies he was receiving from Ukraine.”

• Democrats Were First To Enlist Ukraine In US Elections (Solomon)

Earlier this month, during a bipartisan meeting in Kiev, Sen. Chris Murphy (D-Conn.) delivered a pointed message to Ukraine’s new president, Volodymyr Zelensky. While choosing his words carefully, Murphy made clear — by his own account — that Ukraine currently enjoyed bipartisan support for its U.S. aid but that could be jeopardized if the new president acquiesced to requests by President Trump’s lawyer, Rudy Giuliani, to investigate past corruption allegations involving Americans, including former Vice President Joe Biden’s family. Murphy boasted after the meeting that he told the new Ukrainian leader that U.S. aid was his country’s “most important asset” and it would be viewed as election-meddling and “disastrous for long-term U.S.-Ukraine relations” to bend to the wishes of Trump and Giuliani.

“I told Zelensky that he should not insert himself or his government into American politics. I cautioned him that complying with the demands of the President’s campaign representatives to investigate a political rival of the President would gravely damage the U.S.-Ukraine relationship. There are few things that Republicans and Democrats agree on in Washington these days, and support for Ukraine is one of them,” Murphy told me today, confirming what he told Ukraine’s leader. The implied message did not require an interpreter for Zelensky to understand: Investigate the Ukraine dealings of Joe Biden and his son, Hunter, and you jeopardize Democrats’ support for future U.S. aid to Kiev.

The Murphy anecdote is a powerful reminder that, since at least 2016, Democrats repeatedly have exerted pressure on Ukraine, a key U.S. ally for buffering Russia, to meddle in U.S. politics and elections. [..] As I have reported, the pressure began at least as early as January 2016, when the Obama White House unexpectedly invited Ukraine’s top prosecutors to Washington to discuss fighting corruption in the country. The meeting, promised as training, turned out to be more of a pretext for the Obama administration to pressure Ukraine’s prosecutors to drop an investigation into the Burisma Holdings gas company that employed Hunter Biden and to look for new evidence in a then-dormant criminal case against eventual Trump campaign chairman Paul Manafort, a GOP lobbyist.

[..] Biden threatened to withhold $1 billion in crucial U.S. aid to Kiev if Poroshenko did not fire the country’s chief prosecutor. Ukraine would have been bankrupted without the aid, so Poroshenko obliged on March 29, 2016, and fired Prosecutor General Viktor Shokin.At the time, Biden was aware that Shokin’s office was investigating Burisma, the firm employing Hunter Biden, after a December 2015 New York Times article. What wasn’t known at the time, Shokin told me recently, was that Ukrainian prosecutors were preparing a request to interview Hunter Biden about his activities and the monies he was receiving from Ukraine. If such an interview became public during the middle of the 2016 election, it could have had enormous negative implications for Democrats.

Read more …

Tulsi Gabbard is on the verge of making the October debate. They don’t want a repeat in November.

• Democrats Announce Tighter Criteria For Fifth Presidential Debate (R.)

The Democratic National Committee on Monday announced new criteria for the fifth presidential debate in November, requiring candidates to meet one of two polling requirements and have 165,000 unique donors. Candidates must either receive 3 percent or more support in four national or early state polls or 5 percent or more support in two polls of the states that hold early presidential nominating contests: Iowa, New Hampshire, South Carolina or Nevada. They must show a minimum of 600 unique donors per state in at least 20 U.S. states, territories or the District of Columbia, the DNC said.


The new requirements promise to further cull the large Democratic field of 19 candidates seeking to challenge Republican President Donald Trump in the November 2020 election. Former Vice President Joe Biden has led most opinion polls so far, followed by U.S. Senators Elizabeth Warren and Bernie Sanders. The sprawling field has made it difficult for lesser-known candidates to register in the minds of Democratic voters, with several polling at 1 percent or less nationally. [..] Criteria for the September and October debates required donations from at least 130,000 people and support of at least 2% in four DNC-approved polls.

Read more …

Local bans on global networks?!

• Google Wins Landmark Right-To-Be-Forgotten Case In Europe (BBC)

Europe’s top court has ruled that Google does not have to apply the right to be forgotten globally. It means that firm only needs to remove references to articles and other material from its search results in Europe – and not elsewhere – after receiving an appropriate request. The ruling stems from a dispute between Google and a French privacy regulator. In 2015, CNIL ordered the firm to globally remove links to pages containing damaging or false information about a person. The following year, Google introduced a geoblocking feature that prevents European users from being able to see delisted links. But it resisted censoring search results for people in other parts of the world.


And the firm challenged a 100,000 euro fine that CNIL had tried to impose. Google had argued that the obligation could be abused by authoritarian governments trying to cover up human rights abuses were it to be applied outside of Europe. The tech firm had been supported by Microsoft, Wikipedia’s owner the Wikimedia Foundation, the non-profit Reporters Committee for Freedom of the Press, and the UK freedom of expression campaign group Article 19, among others. ECJ adviser Maciej Szpunar had also concluded that the right to be forgotten be limited to Europe in a non-binding recommendation to the court earlier this year.

Read more …

An all-out attack on the Espionage Act.

• US Government Moves To Block Alleged Drone Whistleblower’s Defense (SProof)

The United States government has moved to block Daniel Hale, a former U.S. Air Force language analyst, from presenting any evidence that he had “good motives” when he allegedly disclosed documents to a reporter that exposed a targeted assassination program involving armed drones. Yet, while the U.S. government hopes to ensure Hale cannot put on a whistleblower defense during his trial, Hale’s defense attorneys have directly challenged the constitutionality of the Espionage Act, arguing it violates the First Amendment. They also assert that the government is selectively and vindictively prosecuting Hale for his alleged act of dissent.

Hale was indicted on five counts on May 9. Three of the charges allege he violated the Espionage Act. One charge alleges he disclosed “communications intelligence” without authorization. The fifth charge alleges he stole “government property.” In October 2015, The Intercept published a “cache of secret documents detailing the inner workings of the U.S. military’s assassination program in Afghanistan, Yemen, and Somalia.” The media organization said the documents were provided by a whistleblower and offered “unprecedented glimpse into [President Barack] Obama’s drone wars.” They were called “The Drone Papers.” These are the documents that the government accuses Hale of disclosing without proper authorization to the public.

[..] There were only three prosecutions under the Espionage Act for the first 75 years that were “premised” on “leaks.” However, since 2009, there have been 18 prosecutions of media sources, according to Hale’s attorneys. President Barack Obama’s administration set the record for more leak prosecutions under the Espionage Act than all previous U.S. presidents combined, and the Obama Justice Department’s novel interpretations of the Espionage Act set the stage for President Donald Trump to launch a prosecution against Hale, as well as WikiLeaks founder Julian Assange, who is the first journalist to be charged with violating this particular law.

Read more …

 

 

 

 

 

All US Homes Are Overvalued

Jun 092018
 
 June 9, 2018  Posted by at 12:37 pm Finance Tagged with: , , , , , , , , , ,  7 Responses »


Dorothea Lange Children and home of cotton workers at migratory camp in southern San Joaquin Valley, CA 1936

 

My long time pal Jesse Colombo, now at Real Investment Advice, recently linked on Twitter to a Zero Hedge article, which quoted CoreLogic as saying more than half of American homes are overvalued. CoreLogic calls itself “a leading provider of consumer, financial and property data, analytics and services to business and government.”

Well, CoreLogic is way off. All American homes are overvalued. How can we tell? It’s easy. It’s so easy it’s perhaps no wonder that people overlook the reasons why. But we all know them: The Fed has pushed some $20 trillion down the throats of the financial system. It has also lowered interest rates to near zero Kelvin. Then the government added a “relaxation” of lending standards and an upward tweak of credit scores. And Bob’s your uncle.

These measures haven’t influenced just half of US homes, they’ve hit every single one of them. Some more than others, not every bubble is as big as San Francisco’s, but the suggestion that nearly half of homes are not overvalued is simply misleading. It falsely suggests that if you buy a home in the ‘right’ place, you’ll be fine. You won’t be. The Washington-induced bubble will and must pop, and precious few homes will be ‘worth’ what they are ‘worth’ today.

Here’s what Jesse tweeted along with his link to the Zero Hedge article:

“Almost half of the US housing market is overvalued” – this is why U.S. household wealth is also overvalued/in an unsustainable bubble.

He followed up with:

U.S. household wealth is in a bubble thanks to Fed-inflated asset prices. This is creating a “wealth effect” that is helping to drive our spurious economic recovery. This economy is nothing but a sham. It’s smoke and mirrors. Wake the F up, everyone!!!

My reaction to this:

Sorry, my friend Jesse, but every single US home is overvalued. It just depends on the vantage point you look from. All prices have been distorted by the Fed’s policies, not just half of them. Arguably some more than others, but can that be the core argument here?

Jesse’s reply:

Yes, that’s a good point.

Another long time pal, Dave Collum, chimed in with a good observation:

I think even us bunker monkeys start recalibrating, no matter how hard we try to maintain what we believe to be perspective.

Yes, we’ve been at this for a while. Even if Jesse was still a student when he started out. We’ve been doing it so long that he recently wrote an article named: Why It’s Right To Warn About A Bubble For 10 Years. And he’s right on that too.

Let’s get to the article the conversation started with:

 

More Than Half Of American Homes Are Overvalued, CoreLogic Warns

CoreLogic reports that residential real estate prices nationwide increased 6.9% year over year from April 2017 to April 2018. The firm’s Home Price Index (HPI) also shows a 1.2% rise on the month-over-month basis from March to April 2018. This has certainly sparked the debate of housing affordability across the nation with many millennials struggling to achieve the American dream.

CoreLogic Market Condition Indicators showed that 40% of the 100 largest metropolitan areas were overvalued in April, compared to 28% undervalued, and 32% in line with valuations. The report uncovers a shocking discovery that of the nation’s top 50 largest residential real estate markets, 52% were overvalued in April.

CoreLogic’s methodology behind overvalued housing markets “as one in which home prices are at least 10% higher than the long-term, sustainable level, while an undervalued housing market is one in which home prices are at least 10% below the sustainable level.”

The CoreLogic people probably mean well, but they also probably don’t want to rattle the cage. It’s not really important. As soon as someone starts talking about a ‘sustainable level’ for home prices, you can tune out. Because no such thing exists. Unless you first take those $20 trillion out of the ‘market’, free up interest rates, tighten lending standards and lower credit scores. Only then MAY you find a ‘sustainable level’ for prices.

Historically a house in the US cost around 3 to 4 times the median annual income. During the housing bubble of 2007 the ratio surpassed 5 – in other words, the median price for a single-family home in the United States cost more than 5 times the US median annual household income. According to Mike Maloney, this ratio is heavily influenced by interest rates. When interest rates go down the affordability of a house goes up, so people spend more money on a house. Interest rates have now been falling since 1981 when they peaked at 15.32% (for a 10-year US treasury bond).

Mike Maloney, another longtime friend of the Automatic Earth, is dead on. Price to income is a useless point unless you include interest rates in the calculation. And then you can get large differences. Since interest rates have been falling for 37 years, count on them to rise. And see what that does to your model.

“The best antidote for rising home prices is additional supply,” said Dr. Frank Nothaft, chief economist for CoreLogic. “New construction has failed to keep up with and meet new housing growth or replace existing inventory. More construction of for-sale and rental housing will alleviate housing cost pressures,” Nothaft added.

Right, yeah. Now we know the CoreLogic mindset. The more you build, the better home prices will be. Just one of many problems with that is that if you really expect prices to fall once you build, people will build fewer houses, because profit margins fall too. The whole idea that we can save housing markets by simply building ever more has never rung very true. But that’s for another day.

In a recent op-ed piece via The Wall Street Journal, Paul Kupiec and Edward Pinto place the blame on the government for creating another real estate bubble through “loose mortgage terms pushing home prices up.” They claim that mortgage underwriters need to tighten standards.

“Home prices are booming. So far, 2018 has posted the strongest growth since 2005. “About 60% of all U.S. metros saw an acceleration in the rate of price increases through February this year,” according to Housing Wire. Since mid-2012, real home prices have increased 28%, according to data from the American Enterprise Institute. Entry-level home prices are up about double that rate. In contrast, over the same period household income has barely kept pace with inflation. The current pace of home-price inflation is increasing the risk of another housing bubble.

The Fed is raising rates -finally- and home prices grow at the fastest rate in 13 years. Over the past 6 years prices are up 28%. Entry level homes are up more than 50% in that time frame. That is just profoundly scary. It’s like Dante’s descent into hell. And no, it’s not true that “The current pace of home-price inflation is increasing the risk of another housing bubble”. We’re already caught up head first in a new housing bubble.

“The root of the problem is declining underwriting standards. In April Freddie Mac announced an expansion of its 3% down-payment mortgage, the better to compete with the Federal Housing Administration and Fannie Mae . Such moves propel home prices upward. Because government agencies guarantee about 80% of all home-purchase mortgages, their underwriting standards guide the market.

Making lending even more dangerous, CNBC recently reported that “credit scores may go up” because new regulatory guidance allows delinquent taxes to be excluded when calculating credit scores. These are only some of the measures that “expand the credit box” and qualify ever-shakier borrowers for mortgages.”

As I said before: if you lower lending -and underwriting- standards and artificially raise credit scores, then yes, you can keep the bubble going for a while longer. But it overvalues properties. You’re just moving goalposts.

“During the last crisis, easy credit led home prices to rise at an unsustainable pace, leading marginally qualified borrowers to stretch themselves thin. Millions of Americans’ dreams became nightmares when the housing market turned. The lax underwriting terms that helped borrowers qualify for a mortgage haunted many households for the next decade.”

No, it’s not just homes. Stocks and bonds as just as overvalued. Because of a behemoth attempt at making the economy look good, even though it’s entirely fake. No price discovery, no market, just central banks and tweaking standards and surveys. C’mon, we all know where this must go. We just don’t want to know. So this Marketwatch piece gets a wry smile at best:

 

America Is House-Rich But Cash-Poor

The housing market has not only recovered from the Great Recession, it’s heated up. According to an analysis from Attom Data, nearly 14 million Americans are now “equity rich” – meaning they have at least 50% equity in their homes. It bears repeating that many owners and communities are not so lucky: over a million Americans are underwater, and some cities and towns are still reeling under the weight of abandoned and vacant homes and stagnant micro-economies. But for most of the country, rapidly rising home prices and a dearth of anything else to buy means people are staying in their homes longer, allowing them to accrue more and more equity: $15 trillion worth, to be exact.

 

 

Everything The Fed Does Is Scripted

Oct 302014
 
 October 30, 2014  Posted by at 12:18 am Finance Tagged with: , , , ,  14 Responses »


John Collier Street Corner, Monday after Pearl Harbor, San Francisco Dec 8 1941

Janet Yellen today solemnly stated that the Fed has killed QE because the jobs outlook has improved. These are the guys and gals who have more and better access to more and better data than any of us have. And we all know that the sole reason the BLS unemployment rate has fallen is that 90-odd million working age Americans are no longer counted as part of the work force, and a huge part of those who are still employed moved to worse-paying jobs and/or had their pay and/or benefits cut.

To claim that QE improved the jobs picture is either very stupid, and I’ve never thought that gang is stupid, just perverted, or it means they don’t have the proper data, but we already saw that they do. So that jobs thing is bollocks.

And I haven’t seen anyone come up with a satisfactory answer as to why the Fed really quit QE the moment they’re doing it. Here I’m thinking that’s an interesting question, and all the pundits and experts leave that question alone. Then again, I have of course tried to answer it, a number of times, with the help of some other people’s observations, and noted that Wall Street banks saw their profits slip because everyone was on the same side of the wagers as they were. They were still getting the free money, but they couldn’t make it work for them anymore the way it once did. And something had to change.

Does anyone outside the Fed want to claim that QE had a positive influence on the American economy, other than through boosting prices of stocks and homes that could only happen because people started seeing things that weren’t really there? I guess there’s plenty of you out there who think the jobs picture actually has improved, and that those $4 trillion or so actually had something to do with that, but that only leads us right back to the beginning:

Why does the Fed cut QE now, when in reality nothing has improved in the American economy if you wipe the smoke from the mirrors, and they know it, even if they say the opposite? And if their view remains as distorted as it is today, why wouldn’t they raise rates much sooner than everyone seems to presume? QE never had anything to do with the real economy (even Greenspan said as much in the WSJ), so there’s no point in keeping rates low to save that real economy. QE has created a perception only, and no substance. And if they take away the perception, there still won’t be any substance, so why not do it?.

When you see Greenspan being paraded in public like he was in the WSJ this morning, you know everything must be scripted. That’s no coincidence. You know, just in case you hadn’t figured that out yet. The Oracle is pushed onto the stage to confuse the ranks a bit more, just so as much money as possible stays invested in the very things Wall Street wants them to be invested in. Greenspan’s job is to say the things Yellen cannot. His words are published the morning of the day she’s set to announce the death of QE.

He said that the purchases of Treasury and mortgage-backed securities did help lift asset prices and lower borrowing costs. But it didn’t do much for the real economy. “Effective demand is dead in the water” and the effort to boost it via bond buying “has not worked,” said Mr. Greenspan. Boosting asset prices, however, has been “a terrific success.”

Too many questions there to mention. Asset prices are high but there’s no demand, to sum it up. Which raises that one question again: if “effective demand is dead in the water”, why kill QE? Or: if QE boosted asset prices, what will its demise result in?

Asked whether he regrets not doing more with Fed policy to stop the financial-market bubbles that preceded the crisis, Mr. Greenspan said “no.” He observed that history shows central banks can only prick bubbles at great economic cost. “It’s only by bringing the economy down can you burst the bubble,” and that was a step he wasn’t willing to take while helming the Fed …

Greenspan effectively admits he created a bubble in those words, plus he doesn’t regret it. And he realizes the only way to burst the bubble, which, he also admits, has grown to behemoth proportions through QE, is by bringing the economy down.

There’s tons of people claiming QE4 is just around the corner. I’m certainly not one of them. I think the Fed is going to do what Greenspan said there: bring the economy down. And justify that by saying that it’s the only way to burst the bubble and make it healthy again. Raise interest rates and declare that they’ve been too low for too long. Pump up the dollar and claim it’s been undervalued too long because of the global impact of QE’s flood of cheap credit.

Low interest rates don’t work to improve the real economy. Neither does free credit for Wall Street. So now that more people are finally figuring that one out, they’re going to let go of these manipulations that pose as policies, while supporting their member banks in making the biggest possible profits off of the impending changes.

And don’t think that every move they’ve made over the past years has not been as scripted as the Greenspan interview. The Fed doesn’t react to – changing – circumstances, it scripts them. And it’s not about Greenspan or Yellen or Bullard or even Jamie Dimon, they’re hand-puppets; it’s about the wizards behind the curtain. Pretty clear cut. You just have to pay attention. Or you’ll lose your shirt and then some.

The Fed Must Feed The Beast

Oct 142014
 
 October 14, 2014  Posted by at 8:39 pm Finance Tagged with: , , , ,  6 Responses »


Dorothea Lange Drought-stricken farmer and family near Muskogee, OK Aug 1939

With the US mid-term elections just 3 weeks away, of course there won’t be any sudden interest rate hikes or other major moves directly traceable to, or even remotely suspected to be from, the Federal Reserve and its Wall Street and/or global central bank chums. But I’ll explain once more why I think those hikes are coming – just not before November 4 – on the back of a Bloomberg piece today.

Mark October 26 as well, by the way: ECB stress test results and Ukraine elections without east Ukraine. And if you’re interested, you can read back what I said before about those rate hikes in This Is Why The Fed Will Raise Interest Rates (Aug 29) and Why The Fed WILL Raise Rates (Sep 30).

Actually, there’s two Bloomberg pieces today that are relevant to my point. Here’s the first:

Too-Big-to-Fail Banks Face Up to $870 Billion Capital Gap

Too big to fail is likely to prove a costly epithet for the world’s biggest banks as regulators demand they increase debt securities to cover losses should they collapse. The shortfall facing lenders from JPMorgan to HSBC could be as much as $870 billion, according to estimates from AllianceBernstein, or as little as $237 billion forecast by Barclays. The range is so wide because proposals from the Financial Stability Board outline various possibilities for the amount lenders need to have available as a portion of risk-weighted assets.

With those holdings in excess of $21 trillion at the lenders most directly affected, small changes to assumptions translate into big numbers. “The direction is clear and it is clear that we are talking about huge amounts,” said Emil Petrov at Nomura in London. “Regulatory timelines will stretch far into the future but how quickly will the market demand full compliance?”

A hard question to answer given that the Fed et al have been the market for a long time now. Them and the HFT robots. Webster’s should really redefine the term markets. But then, I understand there’s been some pick-up from ultra-low volumes recently as the VIX rises with human nerves.

The FSB wants to limit the damage the collapse of a major bank would inflict on the world economy by forcing them to hold debt that can be written down to help recapitalize an insolvent lender. For senior bonds to suffer losses under present rules the institution has to enter bankruptcy, a move that would inflict huge damage on the financial system worldwide if it happened to a global bank. That’s what happened when Lehman collapsed in 2008.

The FSB, which consists of regulators and central bankers from around the world, will present its draft rules to a G-20 summit in Brisbane, Australia, next month. Its proposals call for 27 of the world’s largest banks to hold loss-absorbing debt and equity equivalent to 16% to 20% of their risk-weighted assets to take losses in a failure …

Under the plans, these lenders will also have to meet buffer rules set by the Basel Committee on Banking Supervision, another group of global regulators. These can amount to a further 5% of risk-weighted assets, taking banks’ requirements to as much as 25% of holdings.

All the numbers and percentages don’t matter much, because they could all just as well have been invented on the spot. What makes this piece, and those ECB stress test results, relevant, is that they point out the how big banks are still far from healthy, no matter the profits and bonuses they report and dole out. No surprise there if you’ve been paying attention the past decade. No amount of free money will ever nurse them back to health. But it can keep them slugging along, replete with lots of green goo, empty sockets and tombstones.

It gets more interesting in the next bit, where you need to read between the lines a little. I took the liberty of bolding the juiciest bites:

No Stock Salvation Seen in Bank Results as VIX Surges

Options traders are skeptical this week’s bank earnings will deliver calming news to a stock market enduring its worst losses in two years. U.S. stocks have fallen for the past three days on concerns about global growth, the future of interest rates and the spread of Ebola. With companies from JPMorgan to Goldman Sachs and Bank of America scheduled to report this week, demand for bearish options on the largest U.S. financial firms has increased to the highest since May 2013.

Even though banks have escaped the worst losses in the recent selloff, the companies will struggle to boost profits if the Federal Reserve keeps interest rates near zero. Analyst projections tracked by Bloomberg show financial companies in the S&P 500 Index increased earnings 3.1% in the third quarter and 1.6% in the fourth. “There’s an anticipation that a significant percentage of earnings are going to lower forward guidance relatively significantly, including some of the big banks,” Jeff Sica at Sica Wealth Management said by phone.

“That’s going to have a very negative impact on the stock market.” JPMorgan, Citigroup and Wells Fargo are scheduled to provide quarterly results this morning. Bank of America, Goldman Sachs and Morgan Stanley report later in the week. Low interest rates have crimped lending profits for banks, which benefit from higher loan yields. Net interest margins, the difference between what a firm pays in deposits and charges for loans, were a record-low 3.1% in the second quarter…

Fed Vice Chairman Stanley Fischer said during the weekend that U.S. rate increases could be delayed by slowing growth elsewhere. The central bank should be “exceptionally patient” in adjusting monetary policy, Chicago Fed President Charles Evans said yesterday.

Wait, that’s not what Fisher implied, at least not as MarketWatch reported it:

Fed’s Fischer Says Rate Hike Won’t Damage Global Economy

The Federal Reserve’s eventual rate increase, the first since 2006, will not damage the global economy, Federal Reserve Vice Chairman Stanley Fischer said on Saturday. While there could be “further bouts of volatility” in international markets when the Fed first hikes, “the normalization of our policy should prove manageable for the emerging market economies,” Fischer said in a speech at the IMF’s annual meeting.

[..] Since last year, Fischer said, the Fed has “done everything we can, within limits of forecast uncertainty, to prepare market participants for what lies ahead.” The Fed has been as clear as it can be about the future course of its policy course, and markets understand, Fischer said. “We think, looking at market interest rates, that their understanding of what we intend to do is roughly correct … ”

There’s a veiled message in there that’s very different from Chuck Evans’ “The central bank should be “exceptionally patient” in adjusting monetary policy.” Fisher says it won’t make any difference, because everybody already knows what will come. Which is a load of male bovine, because many of the emerging nations that are neck deep in dollar denominated debt have nowhere to turn. And besides, the Fed doesn’t serve market participants, or the real economy, or Americans, and certainly not enmerging markets, The Fed serves banks. Still, for now the confusing messages work miracles (we return to that 2nd Bloomberg piece):

Federal fund futures show the likelihood of a September 2015 rate increase fell to 46%, from 56% on Oct. 10, and 67% two months ago, according to data compiled by Bloomberg.

Wow, that’s a lot of behinds risking a severe burn. You better hope your pension fund manager is just a tad less complacent.

“If you get rates rising, you can price that into loans,” Peter Sorrentino at Huntington Asset Advisors, said. “We haven’t seen much shift in the yield curve, even though people thought this would be the year for it because of the Fed easing on QE. There’s a disappointment that we haven’t seen better margin growth this year.”

That’s all you need to know. Wall Street banks are still ‘down on their luck’ (I know I’m funny), they’re no longer making real money with interest rates scraping zero, and the answers to their ‘sorrows’ are right there in the hands of the people they own: the Fed. There have been a few years of free cash and zero rates which were profitable, but that has put all market parties in the same boat, so the real money, nay, the only money, is now in being on the other side of that boat, that bet, that trade. The trade, and the emotion, has shifted singnificantly. 90º, 180º, take your pick.

Increased volatility will boost trading revenues for the financials, according to Arjun Mehra of JPMorgan. [..] “For the first time in over a year, the largest U.S. banks are expected to get a boost from their trading business, which stands in stark contrast to press reports heading into the second quarter that called for the death of trading,” Mehra wrote. The VIX, a gauge of S&P 500 derivatives prices, jumped 41% last quarter for its biggest increase in three years. Bank of America Merrill Lynch’s MOVE Index, which measures implied volatility on U.S. Treasuries, climbed 22%.

Everyone’s gotten complacent, everyone follows Yellen’s lips, everyone thinks the same. There’s no money in that, and Wall Street needs money, badly. The money is now in volatility, not the lack thereof. So we will have volatility, it’s already rising.

“There are two things banks need to work: higher rates and credit expansion,” Mark Freeman at Westwood Holdings said. “Just as the outlook for growth is getting called into question, the outlook for higher rates is being called into question, and that’s been a headwind for the group as of late.”

The higher rates will be there, and not as late as September 2015. No profit in that. Credit expansion comes to an end, in a sense, with the tapering of QE. But guess what? A significantly higher dollar works the exact same way. It expands ‘credit’ in all – or most – other currencies, and in commodities.

Understand the make-up of the system, the role of the Fed and other central banks, and their relationship with the major commercial/investment banks, and it becomes obvious what their next moves will – must – be. The beast must be Fed.

Debt Rattle Oct 1 2014: Europe Is Crumbling Into Collapse

Oct 012014
 
 October 1, 2014  Posted by at 9:40 pm Finance Tagged with: , , , , , , ,  16 Responses »


David Myers Theatre on 9th Street, Washington, DC July 1939

For me, the quote of the day is this one: “If there’s a periphery of the eurozone’s periphery, that’s Naples.”. The city of Napoli hosts ECB boss Mario Draghi and the heads of Europe’s central banks this week in some very posh former Bourbon family royal palace, and the contradictions involved couldn’t be more striking.

Napoli is home to an immense amount of poverty and misery, and the advent of the EU and the euro has done absolutely nothing to make life in the city any better. Quite the contrary. And there’s not a single thing in sight that holds any promise of alleviating the deepening Italian downfall. Therefore things can, and will, only get worse from here.

And that’s not just true for Italy, or Napoli. It’s true for all of Europe. That is not because Mario Draghi hasn’t spent enough money, or too much of it, or that he’s spent it in the wrong places. It’s because Napels is not Berlin or Frankfurt, or even Milan in the much richer north of Italy. And because Italy is not Germany, and Greece is not Finland, and trying to force all of them into one and the same economic mold can only possibly end in the poor getting poorer.

Unless there would be a massive wealth transfer from rich to poor, from north to south, but that’s never been in the cards. The intention was always to make the EU a tide to lift all boats, or even, in the wildest dreams, a boat to lift all tides. That intention has failed in dramatic fashion. But not one single one of the architects and present day leaders is ready to fess up to their failures.

Almost 15 years after the euro was introduced, the battlefields are littered with dead and wounded bodies. And the only answer that comes from Brussels is to strengthen the – financial and political – army. The only answer that comes from Brussels is that Europe, including Italy, Greece, Spain, needs more Brussels, more centralized control.

And Napoli is not the only place that can lay claim to the title “periphery of the eurozone’s periphery”. Spain and Greece have unemployment numbers just like Napoli, only for them it’s in their entire countries. All have had youth unemployment at well over 50% for years now, a sort of real life version of throwing your babies away with the bathwater. And all have regions and cities where things are much worse still.

Oh well, at least Bloomberg has a poetic headline for once:

Draghi Takes ECB to Land of Gomorrah as Naples Prays

As Europe’s central bankers gather in Naples to discuss the state of the region’s economy, the city stands as a stark warning of just how bad things can get. “If there’s a periphery of the eurozone’s periphery, that’s Naples,” said economist Riccardo Realfonzo, a former councilman of the Southern Italian city. “The gap between the debate at the Royal Palace in Capodimonte and everyday life can’t be filled with just monetary policy.”

In Naples “there is a hunger for bread and justice, hope and future, work, legality and planning,” local Catholic Archbishop Crescenzio Sepe on Sept. 19 told the faithful gathered in the city’s medieval cathedral for the ritual of the so-called miracle of San Gennaro, the patron saint.

Last year, Naples scored the highest among Italy’s main cities on the misery index, a gauge which combines unemployment and deflation. With a reading of 26.7% it stood above Greece. Much like Greece, Naples, hard hit by Italy’s longest recession on record, risked default this year after a court rejected plans to cut municipal debt of about €1 billion ($1.3 billion). [..] Naples’ 2013 gross domestic product per capita was one-third less than Italy’s average and its unemployment was more than double the national average at 25.8%.

The outlook for the future is far from rosy after Italy entered a new recession in the second quarter and the government was forced to cut the country’s growth forecast. Finance Minister Pier Carlo Padoan said yesterday 2014 GDP is seen shrinking 0.3%, compared with an April forecast of a 0.8% expansion. The government also sees GDP growing just 0.6% next year, compared with a previous estimate of 1.3%.

In that setting, or rather overseeing it from a heavily guarded and inaccessible palace, enjoying the best food and wine freshly printed money can buy, Europe’s central bank bosses are planning their next moves.

And still the only answer is more Brussels. Where Mario Draghi now wants to start buying up Greek and Cypriot junk loans, simply because that’s all they have left to sell. That’s where we stand today. We’re back to toilet paper as the only thing that represents any value.

And, you know, if a country like Spain, with 25% unemployment, can get investors to nevertheless buy its bonds with real yields below zero, maybe there is some – although doomed – logic somewhere in Draghi’s ideas. If you distort and pervert values enough so nobody knows what anything is worth anymore, and you still have all these big funds needing to roll over their ‘investments’, you have them trapped, or at least temporarily.

The question is, for how long?

European Bond Yields Go Negative

Record-low interest rates in Europe have flipped bond investing on its head. Some bond buyers, typically paid for lending out their money, have begun paying borrowers to look after their cash. In September, yields on two-year Irish government debt dipped below zero for the first time, just four years after the country needed a €67.5 billion ($85.6 billion) bailout to avert a banking-system collapse. At the height of the eurozone’s debt crisis, Ireland’s two-year bonds were yielding more than 14%.

Now, they are yielding about minus 0.01%. Yields move inversely to prices. The sharp drop in Ireland’s borrowing costs marks a rapid return of investor confidence, but the recovery is also part of a wider theme in Europe: central-bank policy pushing interest rates ever lower, and in some cases, turning bond yields negative.

[..] “We think negative yields will spread, because the impact of the ECB’s rate cut is ongoing,” said Mr. Bayliss. Yields will continue their decline as short-term debt matures and cash is reinvested, he added. “You’re going to see more countries and longer maturities in the negative-rate camp,” he said. Given that backdrop, one way investors can boost returns is by buying longer-dated bonds. Spanish government debt maturing in July 2017, for instance, yields roughly 0.5%, according to Tradeweb.

By instead lending to Spain for 10 years, yields jump to about 2%. Another way to snag higher yields is to buy riskier bonds with lower credit ratings. Ben Bennett, a credit strategist at Legal & General Investment Management, says that with investment-grade corporate bonds yielding so little the only way to get a reasonable return in Europe is by lending to junk-rated companies or by buying junior bonds that are first to take a hit if a company defaults on its debt. “This should work out fine if the ECB’s policies kick-start the European economy, but they don’t have a very successful track record in recent years,” Mr. Bennett said.

They sure don’t. And that’s not even Draghi’s fault, he’s just a clown. The entire structure of the EU is to blame. Draghi won’t be able to buy any toilet paper unless Merkel gives in. But the EU economy has now started to drag down Germany as well, so she will have to choose to protect her own people first. Which is precisely where the EU fails, that that is still possible.

In the US California can’t say screw Kansas. In the EU, that is an option. The richer nations only signed up to the project to get richer off it. The same as the poorer. Nobody ever gave any thought to what should be done is everybody got poorer, and if they did, it certainly wasn’t put into written words. So Germany CAN elect to put itself first, and try to boost its economy at the expense of Spain. And that’s what it’ll do, especially after the recent rise of anti-euro sentiments.

Sentiments that will crop up and grow in ever more places in ever stronger ways. Because there is no way to save the pan-European ideals within the settings laid out inside the EU. You can’t turn Spain into Germany overnight, for the same reason that you can’t demand the Spanish turn to beer and bratwurst from one day to the next.

There is not one reason why Europe couldn’t be a looser organization of nation states, each with their own currency if that works better for them, but still with many ties defined by those things that do indeed bind them. The thing is, France has close ties to Spain, they share the same border, and France has similar ties to Germany, but Germany and Spain don’t have those ties.

It’s much easier to resolve regional differences within a country the size of France or Spain that it is within a 28-member EU. The differences have become too overwhelming. People from Finland vote on issues in Greece, but they have no idea about those issues. While the Greeks sink into desolation:

60% Of Greeks Live At Or Below Poverty Line

Three in every five Greeks, or some 6.3 million people, were living in poverty or under the threat of poverty in 2013 due to material deprivation and unemployment, a report by Parliament’s State Budget Office showed on Thursday. Using data on household incomes and living conditions, the report – titled “Minimum Income Policies in the European Union and Greece: A Comparative Analysis” – found that “some 2.5 million people are below the threshold of relative poverty, which is set at 60% of the average household income.” It added that “3.8 million people are facing the threat of poverty due to material deprivation and unemployment,” resulting in a total of 6.3 million people.

In the medium term, Europe will fall to bits. It’s inevitable. The crumbling of the walls could only be prevented by overall increasing wealth, but the very structure of the Union doesn’t allow for that to happen. And neither does the global economy.

As for the cheap loans and the yields on peripheral sovereign bonds, the money that investors have out there will flee in a massive move to the global financial center, the US, as soon as interest rates there are raised. Which is another major reason why they indeed will be raised. Come to daddy.

And the EU will go from the lofty ideal of a peacemaker to the reality of being a cause for unrest and then war. It has already made that switch, but nobody notices yet.

Draghi Takes ECB to Land of Gomorrah as Naples Prays (Bloomberg)

As Europe’s central bankers gather in Naples to discuss the state of the region’s economy, the city stands as a stark warning of just how bad things can get. “If there’s a periphery of the eurozone’s periphery, that’s Naples,” said economist Riccardo Realfonzo, a former councilman of the Southern Italian city. “The gap between the debate at the Royal Palace in Capodimonte and everyday life can’t be filled with just monetary policy.” In Naples “there is a hunger for bread and justice, hope and future, work, legality and planning,” local Catholic Archbishop Crescenzio Sepe on Sept. 19 told the faithful gathered in the city’s medieval cathedral for the ritual of the so-called miracle of San Gennaro, the patron saint.

Last year, Naples scored the highest among Italy’s main cities on the misery index, a gauge which combines unemployment and deflation. With a reading of 26.7% it stood above Greece, according to Bloomberg calculations. Much like Greece, Naples, hard hit by Italy’s longest recession on record, risked default this year after a court rejected plans to cut municipal debt of about €1 billion ($1.3 billion). Nor do its troubles end there. Located in one of Italy’s poorest and most crime-ridden areas, Naples’ 2013 gross domestic product per capita was one-third less than Italy’s average and its unemployment was more than double the national average at 25.8%. The city is also prey to periodic garbage crises caused by overflowing landfills and saw its transport system come to a halt last year amid strikes and fuel shortages.

• European Bond Yields Go Negative (WSJ)

Record-low interest rates in Europe have flipped bond investing on its head. Some bond buyers, typically paid for lending out their money, have begun paying borrowers to look after their cash. In September, yields on two-year Irish government debt dipped below zero for the first time, just four years after the country needed a €67.5 billion ($85.6 billion) bailout to avert a banking-system collapse. At the height of the eurozone’s debt crisis, Ireland’s two-year bonds were yielding more than 14%. Now, they are yielding about minus 0.01%. Yields move inversely to prices. The sharp drop in Ireland’s borrowing costs marks a rapid return of investor confidence, but the recovery is also part of a wider theme in Europe: central-bank policy pushing interest rates ever lower, and in some cases, turning bond yields negative.

Germany, the Netherlands, Austria, Finland, Belgium and France had already seen their two-year borrowing costs drop below zero amid a move by the European Central Bank to start charging eurozone banks for keeping deposits at the ECB. That policy shift is encouraging lenders to look for cheaper ways to park their surplus cash. If “you buy short-dated Irish or French paper and pay less [than depositing at the ECB], you’re improving your net income, even if the yields are still negative,” said Jonathan Bayliss, a managing director for global government bonds at Goldman Sachs Asset Management in London. Ireland’s drop into negative territory came after the ECB on Sept. 4 cut benchmark interest rates by 0.1 percentage point to 0.05% and overnight deposit rates by the same amount to minus 0.2%, in a fresh bid to revive the region’s stalling economy. The ECB said it intends also to buy bonds backed by loans such as residential mortgages in an attempt to boost lending, potentially further weighing on yields.

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Nice image.

• Trading The Euro: A Seat On The Titanic? (CNBC)

With the European Central Bank set to meet on Thursday, currency strategists are weighing up whether to join a crowded trade and short the euro or whether to go long and get comfortable with what has been described as a “seat on the Titanic.” The common currency – shared by the 18 nations in the region – has been a one-way trip south this year with the ECB expanding its balance sheet while central banks in the U.S. and the U.K. have been looking to reverse their ultra-easy policies. The currency has depreciated 8.22% year-to-date against a greenback that has recently hit a four-year high against a basket of currencies. The euro is on course for its worst yearly drop since 2005 and September marked its biggest monthly fall since February 2013.

Ranko Berich, the head of market analysis at Monex Europe, a U.K.-based foreign exchange company, believes that the euro could be set for a major collapse. “A long position on the euro might as well be a seat on the Titanic,” he said in a note on Tuesday. Meanwhile, John Higgins, the chief markets economist at Capital Economics, has given a forecast of $1.15 for the euro by the end of 2016. “We suspect (the euro) will drop further as the monetary policies of the (Federal Reserve) and the ECB continue to diverge by more than widely envisaged,” he said in a research note late Tuesday.

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• Mario Draghi Pushes For ECB To Accept Greek And Cypriot ‘Junk’ Loans (FT)

Mario Draghi is to push the European Central Bank to buy bundles of Greek and Cypriot bank loans with “junk” ratings, in a move that is set to exacerbate tensions between Germany and the bank. Mr Draghi, ECB president, will this week unveil details of a plan to buy hundreds of billions of euros’ worth of private-sector assets – the central bank’s latest attempt to save the euro zone from economic stagnation. The ECB’s executive board will propose that existing requirements on the quality of assets accepted by the bank are relaxed to allow the euro zone’s monetary guardian to buy the safer slices of Greek and Cypriot asset backed securities, or ABS, say people familiar with the matter. Mr Draghi’s proposal is designed to make the program of buying ABS, which are bundles of loans sliced and diced into packages, as inclusive as possible.

If it is backed by the majority of members of the ECB’s governing council, the central bank would be able to buy instruments from banks of all 18 euro zone member states. However, the idea is likely to face staunch opposition in Germany, straining already tense relations between the ECB and officials in the euro zone’s largest economy. Bundesbank president Jens Weidmann, who also sits on the ECB’s policy-making governing council, has already objected to the plan to buy ABS, which he says leaves the central bank’s balance sheet too exposed to risks. Wolfgang Schäuble, Germany’s finance minister, has also voiced his opposition, saying purchases would heighten concerns about potential conflicts of interest between the ECB’s role as monetary policymaker and bank supervisor.

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Inevitable.

• Factories Slashing Prices Toughens Draghi’s Deflation Battle (Bloomberg)

Euro-area manufacturing expanded at the slowest pace in 14 months, according to today’s report. The gauge stood at 50.3 in September, just above the 50 mark that divides expansion from contraction, and below a preliminary estimate of 50.5. Euro-area factories cut prices in September by the most in more than a year and German manufacturing shrank, underlining the mounting challenge facing Mario Draghi. The European Central Bank president is on a mission to avert deflation as the euro region’s economic landscape deteriorates. Purchasing Managers’ Indexes from Markit Economics showed manufacturing activity also contracted in France, Austria and Greece, with a gauge for the 18-nation region pointing to almost stagnant output. As the euro area’s economic weakness spreads to countries in the region’s core, the ECB will face increased scrutiny tomorrow when it unveils details of an asset-purchase plan.

The fresh round of stimulus comes against a backdrop of weak inflation and stuttering growth, with geopolitical uncertainty and high unemployment weighing on confidence and demand. “ It is very hard to put any positive spin” on the data, said Howard Archer, chief European economist at IHS Global Insight in London. “Clutching at straws, the best that can be said is that it indicates that the manufacturing sector is still growing.” Euro-area manufacturing expanded at the slowest pace in 14 months, according to today’s report. The gauge stood at 50.3 in September, just above the 50 mark that divides expansion from contraction, and below a preliminary estimate of 50.5. The euro slid after the German report and extended its decline after euro-area data were published. Today’s PMI data make for a “gloomy reading,” said Chris Williamson, chief economist at Markit in London. “The weakening manufacturing sector will intensify pressure on the ECB to do more to revive the economy and no doubt strengthen calls for full-scale quantitative easing.”

A manufacturing gauge for Germany, once Europe’s export-led powerhouse economy, slid to 49.9 last month, the lowest level in 15 months, with new orders falling at the fastest pace since 2012. By contrast, factory activity in Italy returned to growth, with expansions also registered in Spain, the Netherlands and Ireland. In the euro area, new orders fell for the first time since June 2013 due to weak domestic demand and waning exports, Markit said, casting doubt on forecasts that the industry will pick up toward the end of the year. There’s “negative momentum in manufacturing activity, especially in Germany where the pace of slowdown is rather pronounced,” said Marco Valli, chief euro-area economist at UniCredit SpA in Milan. “The data flags clear downside risks to the ECB staff’s growth forecast.”

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• Germany A Fresh Source Of Weakness As Eurozone PMI Falls (MarketWatch)

Activity in the eurozone’s manufacturing sector slowed more sharply than first estimated in September, with Germany joining France in contraction, while Italy staged a surprise revival. Fresh signs that the currency area’s economy remains mired in stagnation, with manufacturers cutting prices for the first time since April, will likely add to pressure on the European Central Bank to take more dramatic stimulus measures to boost demand and inflation. The headline measure from data firm Markit’s monthly survey of purchasing managers at more than 3,000 manufacturers fell to 50.3 from 50.7 in August, an indication that activity barely increased. A reading above 50.0 for the Purchasing Managers Index indicates an expansion in activity, while a reading below that level signals a contraction. The final measure was slightly below the preliminary estimate of 50.5 released in September, and the lowest in 14 months.

In a setback for the currency area’s recovery hopes, Germany’s manufacturing sector was a fresh source of weakness, with its PMI falling to a 15-month low and indicating that activity declined — albeit very marginally. “In a sign of spreading economic malaise, Germany, Austria and Greece all joined France in reporting manufacturing downturns in September,” said Chris Williamson, Markit’s chief economist. Williamson said the surveys suggest the currency area’s “northern industrial heartland has succumbed to the various headwinds of weak demand within the euro area, falling business and consumer confidence, (and) waning exports due to the Ukraine crisis and Russian sanctions.” The surveys suggest that manufacturing activity won’t soon revive, with new orders declining for the first time in 15 months, and export orders rising at the slowest pace since July 2013.

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• Germany Fights On Two Fronts To Preserve The Eurozone (MarketWatch)

The European Court of Justice announced Sept. 22 that hearings in the case against the European Central Bank’s (ECB) bond-buying program known as Outright Monetary Transactions (OMT) will begin Oct. 14. Though the process is likely to be lengthy, with a judgment not due until mid-2015, the ruling will have serious implications for Germany’s relationship with the rest of the eurozone. The timing could hardly be worse, coming as an anti-euro party has recently been making strides in the German political scene, steadily undermining the government’s room for maneuver. The roots of the case go back to late 2011, when Italian and Spanish sovereign bond yields were following their Greek counterparts to sky-high levels as the markets showed that they had lost confidence in the eurozone’s most troubled economies’ ability to turn themselves around. By summer 2012 the situation in Europe was desperate.

Bailouts had been undertaken in Greece, Ireland and Portugal, while Italy was getting dangerously close to needing one. But Italy’s economy, and particularly its gargantuan levels of government debt, meant that it would be too big to receive similar treatment. In any event, the previous bailouts were not calming financial markets. As Spain and Italy’s bond yields lurched around the 7% mark, considered the point where default becomes inevitable, the new president of the European Central Bank, Mario Draghi, said the ECB was willing to do whatever it took to save the euro. In concert with the heads of the European governments, the ECB developed a mechanism that enables it to buy unlimited numbers of sovereign bonds to stabilize a member country, a weapon large enough to cow bond traders.

Draghi never actually had to step in because the promise of intervention in bond markets convinced investors that eurozone countries would not be allowed to default. But Draghi’s solution was not to everyone’s taste. Notable opponents included Jens Weidmann, president of the German Bundesbank. Along with many Germans, Weidmann felt the ECB was overstepping its jurisdictional boundaries, since EU treaties bar the bank from financing member states. Worse, were OMT ever actually used, it essentially would be spending German money to bail out what many Germans considered profligate Southern Europeans.

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No.

• China’s Latest Property Rescue Package: Will It Work? (CNBC)

The latest steps to rescue China’s sagging property sector are among the most high-profile yet, but don’t expect a market turnaround, economists say. Late Tuesday, the People’s Bank of China and China Banking Regulatory Commission announced measures to support housing sales and increase lending to cash-strapped property developers. “These measures are substantial enough to improve sentiment and sales on the property market,” Louis Kuijs, chief China economist at RBS wrote in a note. “[But] we do not expect this package to lead to a rapid recovery of the real estate sector… given the inventories of unsold housing and additional large volumes of housing in construction but not finished hanging over the market,” he said. New measures include granting second-home buyers that have paid off their first mortgage access to lower mortgage rates and lower down-payment requirements.

Now they’re eligible for a 30% discount on mortgage rates, an offer previously limited to first-home buyers. Down payment levels were also cut to 30% from 60-70%. In addition, banks were asked to support the funding needs of “quality” developers, increase their access to the bond market and introduce pilot programs for REITs. An acceleration in China’s property market downturn in recent months intensified concerns about slowing economic growth. New home prices fell for the fourth straight month in August, down 1.1% from the month before, after dipping 0.9% in July, according to Reuters’ calculations of figures released by the National Bureau of Statistics. Many analysts have cited the cooling property sector as a major risk for the economy. The sector accounts for about 15% of gross domestic product and is linked to some 40 industries from furniture to steel.

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And surging.

• Dollar-Yen Breaches 110 For First Time Since 2008 (CNBC)

The dollar hit a new high six-year high against the yen on Wednesday, breaching 110 for the first time since August 2008. The currency pair reached 110.08 in early Asian trading, prompting a Japanese government spokesperson to say that authorities will monitor the yen’s movement carefully. The greenback has strengthened more than 8% against the yen since early August, driven by the Federal Reserve’s tightening monetary policy and recent weakness in the Japanese economy. Japanese policymakers welcome a weaker yen, which boosts exports, but the rapid move is worrying. Japan is stuck with a chronic trade deficit; a major yen depreciation raises the cost of buying materials abroad, squeezing corporate earnings. The dollar-yen could rise slightly further, but will stabilize soon, according to Eisuke Sakakibara, former vice finance minister of Japan.

“Although Japanese economy is currently somewhat weaker than anticipated, it’s still doing fairly well,” said Sakakibara, also known as Mr Yen for his influence on Japan’s currency when he was in office from 1997 to 1999. “Continued weakness of the yen is unlikely; this is clearly the strength of the U.S. dollar. The market has already incorporated the strength of the U.S. dollar so I wouldn’t think dollar-yen will go beyond 112 or 113 – It will be in range trading between 107 and 112 in my view,” he added. There have been increasing calls for policymakers to take further action to prop up the Japanese economy, which has been hit hard by a sales tax hike introduced in April. Fresh data on Tuesday showed a mixed reading – retail sales rose 1.2% on year in August, while household spending fell an annual 4.7%. The Bank of Japan (BOJ) is due to meet next week and many analysts have penciled in a move from the central bank to ease monetary policy further. But Sakakibara believes BOJ governor Haruhiko Kuroda will reserve his ammunition for now.

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Oops.

• Japan Stunned After Massive $617 Billion “Fat Finger” Trading Error (ZH)

A few days ago, Bloomberg had a fascinating profile of the person, pardon degenerate Pachinko gambler, who goes under the name CIS, and who is the “mystery man who moves the Japanese market.” In a nutshell, CIS, a momentum day trader and living proof of survivorship bias in finance (because for every CIS who has, allegedly, made it some 999,999 have failed) has amassed a fortune that he says now exceeds 16 billion yen after having traded 1.7 trillion yen in his career, generating an after tax profit of 6 billion yen in 2013 alone. Of course, the numbers are likely wildly fabricated for pageview purposes becuase as Bloomberg itself admits, “CIS didn’t offer a complete accounting of his investing returns and his wealth for this story, and some of his claims can’t be verified.”

That said, it is indeed the case that Japan has increasingly become a cartoon market in which while days can go by without a single trade taking place in its rigged bond market, where the BOJ has soaked up all the liquidity, when it comes to equities, it has become a free for all for “Mr. Watanabes” who have never taken finance, accounting or economics, but who know all about heatmaps and chasing momentum, and as a result, in a rising market/tide environment, have all grown ridiculously rich. The problem, of course, is that what some may call a market is anything but, and has become a fragile playground for a few technicians who move massive sums of money from Point A to Point B, hoping to outsmart the few remaining others, while in the process earning the rents that the BOJ is eagerly handing out by injecting liquidity at a pace that dwarfs what the Fed did for the past 2 years.

The other problem is that it is a merely of time before everything crashes into a pile of smoldering rubble thanks to the unprecedented fragility that is now embedded in every market, although most likely in Japan first. Which leads us to what just happened in Japan when as Bloomberg reports, stock orders amounting to a whopping $617 billion (yes Bilion with a B) or more than the size of Sweden’s economy, were canceled in Japan earlier today, for reasons unknown although the early culprit is that this was one of the biggest trading errors of all time. Of course, since this trade was noted, and DKed, one can assume that a major whale was on the losing end of the trade: recall that this is precisely what happened to Goldman time and again, when some errant algo caused the firm to lose millions on several occasions in 2012 and 2013. There is one tiny difference: this time it was not Goldman, and the total amount was not a few paltry million but over half a trillion dollars!

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Creative accounting shouldn’t be this transparent.

• Fall In UK Living Standards Deeper Than Thought (Guardian)

The UK’s fall in living standards has been worse than previously thought, the TUC claimed, after new figures showed a bigger squeeze on households’ disposable incomes. The Office for National Statistics published sweeping updates to its previous estimates on the economy on Tuesday that suggested Britain recovered from the recession three-quarters sooner than initial estimates. Its move to new ways of measuring GDP put the size of the economy at 2.7% above its pre-crisis peak in 2008, compared with the previous estimate of 0.2%. But the TUC said the figures also revealed that the toll taken by years of falling real wages was greater than previously thought, as estimates of household disposable income were revised to show it further off its previous peak.

For 2013, real household disposable income per capita, described by the TUC as “the most comprehensive measure of living standards”, was 2.6% below its peak according to the latest data. It was £16,881 in 2013 down from a peak of £17,324 in 2007. On the previous figures, the measure had been 1.8% off the peak, standing at £15,764 in 2013 down from a peak of £16,060 hit in 2009.The TUC general secretary, Frances O’Grady, said: “While the size of the economy has been revised up, household incomes have been revised down. It turns out the UK’s living standards crisis is even worse than we thought.” “This is set to be the first full parliament since the second world war when the government leaves office with people’s pay packets worth less than when they came into power. There is something deeply wrong when the economy is growing, but the people who do all the work face ever shrinking pay and falling living standards.”

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Love it!

• Drugs, Hookers, New GDP Measuring Make UK Economy Look Better (Guardian)

Britain’s economy was bigger and grew faster than previously thought over the second quarter, according to official figures that measure GDP in a new way. The economy also recovered sooner than previously thought from the recession. The Office for National Statistics (ONS) said the economy expanded 0.9% over April to June as both the dominant services sector and construction enjoyed strong growth. That beat economists’ forecasts for GDP growth to hold at a previous estimate of 0.8%. But at the same time the ONS revised down the first quarter figure to 0.7% from 0.8%, leaving the estimate of year-on-year growth at 3.2%. The size of the economy was also upgraded as the ONS moved to a new European-wide way of measuring GDP and incorporated other changes.

Under the new method, illegal activities such as drug dealing and prostitution are included and other activities are accounted for differently, including research & development and military spending. Explaining the figures, the ONS said: “The new data are based on the most far-reaching set of improvements to the national accounts in the last 15 years or so.” The ONS left full-year GDP growth in 2013 unrevised at 1.7%. But it said the changes meant that UK GDP recouped lost ground from the downturn sooner than previously thought. “The new data show that during the recent downturn the economy shrank by 6.0%, rather than the 7.2% previously estimated. GDP was also estimated to have exceeded its pre-financial crisis levels in Q3 2013, three quarters sooner than previously estimated. However, overall, the average absolute quarter-on-quarter revision between 1997 and 2014 Q2 was 0.16%age points,” statisticians wrote alongside the data.

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They, too, are Wall Street banks.

• Fed Rate Policies Aid Foreign Banks (WSJ)

Banks based outside the U.S. have been unlikely beneficiaries of the Federal Reserve’s interest-rate policies, and they are likely to keep profiting as the Fed changes the way it controls borrowing costs. Foreign firms have received nearly half of the $9.8 billion in interest the Fed has paid banks since the beginning of last year for the money, called reserves, they deposit at the U.S. central bankaccording to an analysis of Fed data by The Wall Street Journal. Those lenders control only about 17% of all bank assets in the U.S. Moreover, the Fed’s plans for raising interest rates make it likely banks will see those payments grow in coming years. Though small in relation to their overall revenues, interest payments from the Fed have been a source of virtually risk-free returns for foreign banks. Large holders of Fed reserves include Deutsche Bank, UBS, Bank of China and Bank of Tokyo-Mitsubishi, according to bank regulatory filings. U.S. banks including JP Morgan, Wells Fargo and Bank of America are also big recipients of Fed interest payments, according to the filings.

“It is a small transfer from U.S. taxpayers to foreign taxpayers,” said Joseph Gagnon, a former Fed economist at the Peterson Institute for International Economics. The transfer, he added, was a side effect of Fed policy, not a goal. Behind the payments is a complex interplay between new government regulatory policies and new methods the Fed has developed to control short-term interest rates. The Fed has pumped nearly $3 trillion into the banking system since the 2008 financial crisis, increasing banks’ reserves, in efforts to stabilize markets and boost economic growth. Since 2008, it has paid banks interest of 0.25% on those reserves. The Fed affirmed this month that the rate it pays on reserves will be the primary tool it uses to raise short-term borrowing costs from near zero when the time comes, likely next year. In part because regulatory requirements discourage domestic banks from holding more cash reserves than they need, many of the reserves created by the Fed are held by foreign banks.

In the past, the Fed influenced interest rates by increasing or reducing money in the banking system through small amounts of short-term bond trades with banks. This caused the Fed’s benchmark federal funds rate to rise or fall, influencing other borrowing costs across the economy, such as those on mortgages, credit cards and business loans. Because there is so much money in the financial system now, that old method won’t work and the Fed plans to rely primarily on adjusting the interest rate on reserves to change the fed funds rate and other borrowing costs. The interest payments totaled $4.7 billion so far this year and $5.1 billion last year, and will increase over time as the Fed raises rates. The Fed remits most of its profits to the U.S. Treasury, and the rising cost of the interest payments could put downward pressure on the amount the central bank sends to taxpayers each year, the Fed has said.

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The U.S. government is borrowing about $8 trillion a year.

• If Something Rattles This Ponzi, Life In America Will Change Overnight (MS)

I know that headline sounds completely outrageous. But it is actually true. The U.S. government is borrowing about $8 trillion a year, and you are about to see the hard numbers that prove this. When discussing the national debt, most people tend to only focus on the amount that it increases each 12 months. And as I wrote about recently, the U.S. national debt has increased by more than a trillion dollars in fiscal year 2014. But that does not count the huge amounts of U.S. Treasury securities that the federal government must redeem each year. When these debt instruments hit their maturity date, the U.S. government must pay them off. This is done by borrowing more money to pay off the previous debts. In fiscal year 2013, redemptions of U.S. Treasury securities totaled $7,546,726,000,000 and new debt totaling $8,323,949,000,000 was issued. The final numbers for fiscal year 2014 are likely to be significantly higher than that. So why does so much government debt come due each year?

Well, in recent years government officials figured out that they could save a lot of money on interest payments by borrowing over shorter time frames. For example, it costs the government far more to borrow money for 10 years than it does for 1 year. So a strategy was hatched to borrow money for very short periods of time and to keep “rolling it over” again and again and again. This strategy has indeed saved the federal government hundreds of billions of dollars in interest payments, but it has also created a situation where the federal government must borrow about $8 trillion a year just to keep up with the game. So what happens when the rest of the world decides that it does not want to loan us 8 trillion dollars a year at ultra-low interest rates? Well, the game will be over and we will be in a massive amount of trouble.

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• French Policy Stupor Sends Bearish Equity Bets Soaring (Bloomberg)

French stocks have beaten euro-area stocks for six years. Options traders are betting 2014 will be different. With a budget deficit poised to rise and economic growth running at half the region’s rate, investor sentiment on the CAC 40 Index is deteriorating. Options protecting against swings in the equity gauge cost the most since April 2013 relative to the Euro Stoxx 50 Index, data compiled by Bloomberg show. French stocks slid in the last three months, completing their first quarterly loss in more than two years. International investors are losing patience because policy measures in Europe’s second-largest economy have failed to keep up with those in Spain, Portugal or Ireland, said Yves Maillot, head of European equities for Natixis Asset Management in Paris.

“Being bearish on French stocks is definitely a sentiment story,” Maillot said by phone. “Reforms have only just begun in France and there is still so much to do.” A Bank of America Corp.’s European fund-manager survey conducted last month showed a net 38% of respondents see France as the country they most want to be underweight in the coming year, meaning they plan to own less of the shares than are represented in equity benchmarks. That’s the most in Europe. About 18% are overweight euro-area stocks, an improvement from a month earlier, the survey showed.

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• 60% Of Greeks Live At Or Below Poverty Line (Ekathimerini)

Three in every five Greeks, or some 6.3 million people, were living in poverty or under the threat of poverty in 2013 due to material deprivation and unemployment, a report by Parliament’s State Budget Office showed on Thursday. Using data on household incomes and living conditions, the report – titled “Minimum Income Policies in the European Union and Greece: A Comparative Analysis” – found that “some 2.5 million people are below the threshold of relative poverty, which is set at 60% of the average household income.” It added that “3.8 million people are facing the threat of poverty due to material deprivation and unemployment,” resulting in a total of 6.3 million people.

The State Budget Office’s economists who drafted the report argued that in contrast with other European countries “which implement programs to handle social inequalities, Greece, which faces huge phenomena of extreme poverty and social exclusion, is acting slowly.” They added that there is high demand for social assistance, while its supply by the state is “fragmented and full of administrative malfunctions.” In that context “the social safety net is inefficient, while there is no prospect for the recovery of income losses resulting from the economic recession in the near future,” the report noted, reminding readers that the measure of the minimum guaranteed income “arrived in Greece belatedly.”

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• Maybe This Is Why Carmen Segarra Drove the Fed Nuts (Bloomberg)

We’ve lost something in our human nature since – we’re guessing – the conclusion of the Second World War. Certainly since Vietnam. It’s the willingness to be firm, to say things no one wants to hear, in person. We lost the muscle that allows us to say “no” to something because it might risk upsetting someone, even if it’s the right thing to do, because people are petty and insecure, and no matter the substance of the message that goes along with “no,” it will be how you say “no” that overshadows why you say “no.” “No” means anything negative: I disagree. You are wrong. You didn’t do what you said you would. You’re late and wasted my time. This is central to why Carmen Segarra was fired from the New York Federal Reserve, the dirty laundry from it all now scattered about Wall Street’s front yard for all the neighbors to see. Beyond the other elements to the conflict that resulted in the termination of a woman who did the job she was hired to do, but didn’t do it the way Jennifer Aniston would have done it, lies human nature.

It’s now human nature to play nice. Above all, be nice. It will be referred to as being “professional” or being “collegial.” We’d always thought that risking screwing something up because of a preoccupation with hurting someone’s feelings was being unprofessional. There are those other elements that might explain why Segarra was fired besides the nice quotient, but it’s almost impossible to believe her termination had anything to do with job performance. Like most except Goldman Sachs, we hate to disagree with the New York Fed, but what Ivy League- and Sorbonne-educated international lawyer secretly records herself doing a crappy job for 46 hours? After reading the Pro Publica story and listening to the parallel radio version produced by “This American Life,” we came away asking why, exactly, someone at the New York Fed or any regulator would be afraid of, or intimidated by, the bank or industry they regulate so much that they’d sacrifice Segarra or anyone else in her position. We had to know to help us understand.

Michael Lewis knows his way around Wall Street a little, so we asked him. His column on all this hit the same day as the news. He came up with some of the other, more practical elements. “The simple answer is that it’s become standard practice for Fed employees to go to work for Wall Street firms, so the last thing they want to do is to alienate those firms and come across as people who don’t ‘get it,’” Lewis wrote to us in an e-mail. “When you ask a person making $150,000 a year to control a person making $1.5 million a year, you are asking for trouble,” he wrote. “To that, add the problem that the typical Fed regulator is in the awkward position of having to be educated about whatever the Wall Street firm has dreamed up.”

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• The Rational Complacency Of Financial Markets (Roubini)

There appear to be good reasons why global markets so far have reacted benignly to today’s geopolitical risks. What could change that? Several scenarios come to mind. First, the Middle East turmoil could affect global markets if one or more terrorist attacks were to occur in Europe or the US – a plausible development, given that several hundred Islamic State jihadis are reported to have European or US passports. Markets tend to disregard the risks of events whose probability is hard to assess, but that have a major impact on confidence when they do occur. Thus, a surprise terrorist attack could unnerve global markets. Second, markets could be incorrect in their assessment that conflicts such as that between Russia and Ukraine, or Syria’s civil war, will not escalate or spread. The Russian president Vladimir Putin’s foreign policy may become more aggressive in response to challenges to his power at home, while Syria’s ongoing meltdown is destabilising Jordan, Lebanon and Turkey.

Third, geopolitical and political tensions are more likely to trigger global contagion when a systemic factor shaping the global economy comes into play. For example, the mini-perfect storm that roiled emerging markets earlier this year – even spilling over for a while to advanced economies – occurred when political turbulence in Turkey, Thailand, and Argentina met bad news about Chinese growth. China, with its systemic importance, was the match that ignited a tinderbox of regional and local uncertainty. Today – or soon – the situation in Hong Kong, together with the news of further weakening in the Chinese economy, could trigger global financial havoc. Or the Federal Reserve could spark financial contagion by exiting zero rates sooner and faster than markets expect. Or the eurozone could relapse into recession and crisis, reviving the risk of redenomination in the event that the monetary union breaks up.

The interaction of any of these global factors with a variety of regional and local sources of geopolitical tension could be dangerously combustible. So, while global markets arguably have been rationally complacent, financial contagion cannot be ruled out. A century ago, financial markets priced in a very low probability that a major conflict would occur, blissfully ignoring the risks that led to the first world war until late in the summer of 1914. Back then, markets were poor at correctly pricing low-probability, high-impact tail risks. They still are.

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He was initially sent home with antibiotics?! WTF?

• First Ebola Case Is Diagnosed in the US (Bloomberg)

The first case of deadly Ebola diagnosed in the U.S. has been confirmed in Dallas, in a man who traveled from Liberia and arrived in the U.S. on Sept. 20, the Centers for Disease Control and Prevention said. The man is being kept in isolation in an intensive care unit. He had no symptoms when he left Liberia, then began to show signs of the disease on Sept. 24, the CDC said yesterday. He sought medical care on Sept. 26, was hospitalized two days later at Texas Health Presbyterian and is critically ill, said Thomas Frieden, director of the CDC. Frieden said the agency is working to identify anybody who had contact with the man and track them down. “There is no doubt in my mind that we will stop it here,” he said at a press conference in Atlanta.

The CDC has a team of epidemiologists on the way to Texas, he said. The team will follow anyone who has had contact with the man for 21 days. If they develop any symptoms, they’ll immediately be isolated, and public health officials will trace their contacts. The diagnosis was first confirmed by a Texas lab based on samples of the man’s blood and confirmed by the CDC. The man was traveling to the U.S. to visit family here and was staying with them. He was exposed to only a “handful” of people during the time when he had symptoms, including family members and possibly some community members, according to Frieden, who said there was little risk to anyone on a flight with the man.

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Good article.

• In Less Than 2 Human Generations, 50% Of World Wildlife Is Gone (Bloomberg)

If animals were stocks, the market would be crashing. The chart below shows the performance of an index that tracks global animal populations over time, much like the S&P 500 tracks shares of the biggest U.S. companies. The Global Living Planet Index, updated today by the World Wildlife Foundation, tracks representative populations of 3,038 species of reptiles, birds, mammals, amphibians and fish. To say the index of animals is underperforming humans is an understatement. More than half of the world’s vertebrates have disappeared between 1970 and 2010. (In the same period, the human population nearly doubled.) The chart starts at 1, which represents the planet’s level of vertebrate life as of 1970.

It makes sense that the WWF is framing of biodiversity loss as an index that may look more familiar to financial analysts than environmentalists. The research group’s message is as much economic as environmental: Not only do animal populations represent valuable natural systems that economies rely on, in many cases they are actual tradable goods, like stocks of wild fish. “In less than two human generations, population sizes of vertebrate species have dropped by half,” writes WWF Director General Marco Lambertini. “We ignore their decline at our own peril.” Humans are currently drawing more from natural resources than the Earth is able to provide. It would take about 1.5 planet Earths to meet the present-day demands that humanity currently makes on nature, according to the WWF. If all the people of the world had the same lifestyle as the typical American, 3.9 planet Earths would be needed to keep up with demand.

The report reads like one of the “alarm bells” U.S. President Barack Obama referenced in his climate change speech last week. Unfortunately, according to the WWF, the effects of climate change are only starting to be felt; most of the degradation of the past four decades has other causes. The biggest drivers are exploitation (think overfishing) responsible for 37% of animal population decline, habitat degradation at 31%, and habitat loss at 13%. Global warming is responsible for 7.1% of the current declines in animal populations, primarily among climate-sensitive species such as tropical amphibians. Latin American biodiversity dropped 83%, the most of any region. But the toll from climate change is on the rise, the WWF says, and the other threats to animal populations aren’t relenting. For social and economic development to continue, humans need to take better account of our resources. Because right now, life on Earth is not a bull market.

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