Jul 142019
 


Salvador Dali The hand 1930

 

Where the American Dream Goes to Die: House Prices, Rents, and Incomes (WS)
Why Does The Media Only Care About Dead Migrant Children Under Trump? Ryan)
Big Tech ‘Indenture Entire Populations Into Servitude’ – Snowden (RT)
Epstein’s New Mexico Ranch Linked To Investigation (AP)
A Dozen New Epstein Abuse Victims Come Forward (ZH)
New Envoy Leak Claims Trump Scrapped Iran Nuclear Deal ‘To Spite Obama’ (BBC)
Suspected Leaker of UK Ambassador Cables Identified (R.)
UK Says Iran Tanker Will Be Freed After Guarantees On Destination (AFP)
The Spirit Of Rebellion Spreads In Hong Kong (G.)
Turkey Receives More S-400 Parts As US Holds Off Retaliation (RT)
Chevron Spills 800,000 Gallons Of Oil, Water In California (AP)

 

 

Lots more graphs in the article. This is what happens when a central bank blows a bubble.

Where the American Dream Goes to Die: House Prices, Rents, and Incomes (WS)

The “San Francisco Housing Crisis,” as it’s called on a daily basis, is an extreme. But housing costs in major urban areas in the US have been eating up more and more of household incomes, as house prices and rents have soared and as incomes have crept up painfully slowly. In many cities, not just San Francisco, this condition is now called a “housing crisis” where families with median incomes can no longer afford to rent or buy adequate housing, or where too much of their income is spent on housing, with not enough left over for other things. They have no savings, they barely make it to the next paycheck, and they can’t help the local economy because housing saps their spending power.


Just how out-of-whack this discrepancy between income versus rents and house prices has become over the years is depicted in a new study with long-term charts, released by the research department of Clever Real Estate. Based on Census data going back to 1960 for median household incomes, median gross rents per month, and median house prices, all adjusted for inflation, it shows that nationally, incomes since 1960 have risen just 16%, while rents have risen 72%, and house prices have soared 121%:

In Los Angeles, the median house price increased 358% since 1960, adjusted for inflation, while the median household income rose only 32%. In other words, house prices increased 11 times faster than household incomes:

San Francisco is tops, when it comes to house price increases: Since 1960, house prices surged 531% adjusted for inflation. Over the same period, household incomes also rose sharply, but not nearly enough: 91%. In San Francisco – where about 1% of the population is homeless and many others are struggling – the phrase “housing crisis” is in daily use for a reason: House prices increased about six times faster than incomes:

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In light of the expected ICE actions today, and the equally expected outrage, here’s Danielle Ryan from June 27. Everyone needs to get their facts straight, not just one set of them.

Why Does The Media Only Care About Dead Migrant Children Under Trump? Ryan)

A 2015 lawsuit described “inhumane” conditions in border detention facilities under Obama. Men, women and children, it said, were “packed into overcrowded and filthy holding cells with the lights glaring day and night.” They suffered “in brutally cold temperatures; deprived of beds, bedding, and sleep,” were denied adequate food, water and medical care, as well as “basic sanitation items” like soap, toilet paper and diapers. This all while the media treated Obama with kid gloves and liberals sang his praises.

There were no deaths of children in Customs and Border Protection custody under Obama — and there have been six under the Trump administration, so it is fair to argue, that with the implementation of some more extreme anti-asylum policies and perhaps an even greater lack of caring, Trump has taken an already dysfunctional, inhumane and under-funded system — and simply made it worse. There is a case to be made that he has done this on purpose; to make the situation as unappealing as possible to those who might be tempted to make the treacherous and potentially fatal journey to and across the US’s southern border — but the reality is, however unappealing he tries to make it, for many, it will still be more appealing than the alternative.

The biggest elephant in the room, however, is not that the Obama administration was guilty of many of the same things as the current one. It’s that every single US administration for decades has been guilty of contributing to the creation of this crisis through an abominable imperialist foreign policy that has ravaged the very countries these migrants are coming from. Democrats and Republicans have spent decades enthusiastically destabilizing Latin America under the guise of democracy promotion. In reality, they have stolen its wealth and resources, engineered military coups and installed dictators, funded and equipped death squads — and imposed deadly economic sanctions. Where are all the liberals crying about that? How could such inhumane policy have led to anything else?

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As Steve Wozniak advises people to get off Facebook.

Big Tech ‘Indenture Entire Populations Into Servitude’ – Snowden (RT)

Tech giants such as Google or Facebook store vast amounts of personal data for their own gain but they are also “happy to hand over” this data to governments, making people vulnerable to persecution, Edward Snowden warned. Any person can pretty much be sure that “everything you’ve done, everything you’ve typed into their search box, everything you have clicked on, everything you’ve liked” is duly recorded and stored in the enormous databanks of the big tech corporations, the NSA whistleblower said addressing the UK Open Rights Group Conference (ORGCON19) in London via a video link from Moscow. Your communications, as they happen largely today, don’t actually take place between you and the person that you are talking to.

They happen between you and Facebook, who then provides a copy of it to the person you are talking to, or you and Gmail, who then gives a copy of it to the person that you are talking to and every time these transactions occur through these service providers, they keep a record of it.” The corporations do that primarily to advance their own financial and economic interests, yet they seek to not only “better their class” but also to “better their state” and are, thus, more than happy to share the data they obtained with governments, which, in turn, make a use of it in its mass surveillance programs, Snowden warned.

“We see that governments increasingly care less and less about compliance, and care more and more about power,” he said, adding that the governmental security structures, which were supposedly created to protect the people against the threat of terrorism, are in fact used against pretty much anyone from critically-minded journalists and dissidents to immigrants and minorities. The corporations, which now virtually control the most part of internet communications, have been long abusing their position of power, forcing people into relations one would never “meaningfully consent to” while staying largely unaccountable. The law simply has not caught up to the fact that a technological corporation now can indenture entire populations into servitude to the corporate good, rather than to individual or public good.

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Middle of nowhere?!

Epstein’s New Mexico Ranch Linked To Investigation (AP)

At the center of Jeffrey Epstein’s secluded New Mexico ranch sits a sprawling residence the financier built decades ago — complete with plans for a 4,000-square-foot (372-square-meter) courtyard, a living room roughly the size of the average American home and a nearby private airplane runway. Known as the Zorro Ranch, the high-desert property is now tied to an investigation that the state attorney general’s office says it has opened into Epstein with plans to forward findings to federal authorities in New York. Epstein, who pleaded not guilty this week to federal sex trafficking charges in New York, has not faced criminal charges in New Mexico.

But the scandal surrounding him has still sent a jolt through the rural Southwestern state as it comes under scrutiny for laws that allowed him to avoid registering as a sex offender following a guilty plea a decade ago in Florida.“New Mexico continues to lag behind the rest of the country in strengthening outdated and weak laws that fail to protect our children from abuse,” Balderas said in an emailed statement to The Associated Press. “This is a huge black eye for our state.” In addition to confirming his office had interviewed possible victims of Epstein who visited his ranch south of Santa Fe, Balderas’ spokesman also said Friday that the attorney general would renew his push for legislation requiring anyone with a sex trafficking conviction to register as a sex offender in New Mexico.

[..] In New Mexico, the attorney general said he has been in touch with the U.S. Attorney’s Office in the Southern District of New York. Balderas’ office has not said, however, how many accusers his office has interviewed and he has not elaborated on what they say took place at the ranch. In a 2015 court filing in Florida, a plaintiff in a lawsuit against Epstein said she had been abused at several locations, including the New Mexico property.

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If the prosecutors are serious about asking girls to come forward, he cannot be allowed out on bail, because then they wouldn’t.

A Dozen New Epstein Abuse Victims Come Forward (ZH)

Jeffrey Epstein’s defense team is arguing that their client should be released on house arrest until his trial. They’re also arguing that the charges being brought against Epstein in New York were previously resolved in Florida ten years ago, where Epstein struck his sweetheart deal with prosecutors led by now-Labor Secretary Alex Acosta. But it appears the FBI’s request that any other victims of Epstein come forward succeeded in convincing more than a dozen women, whose cases were not part of the Florida prosecution, to come forward and testify about the abuse they suffered at the hands of Epstein.


According to the Miami Herald, which revived prosecutors’ interest in Epstein with its ‘Perversion of Justice’ series of investigative reports about how Epstein was let off with a slap on the wrist and minimal jail time despite evidence that he was an inveterate, unrepentant pedophile. At least four women have contacted David Boies, the New York power-lawyer who represents some of Epstein’s victims, and at least 10 others have approached other lawyers who have previously represented Epstein’s victims.

“Following Epstein’s arrest Saturday in New Jersey, four women have reached out to New York lawyer David Boies, and at least 10 other women have approached other lawyers who have represented dozens of Epstein’s alleged victims in the past. Jack Scarola, a Palm Beach attorney, said at least five women, all of whom were minors at the time of their alleged encounters with Epstein, have reached out to either him or Fort Lauderdale lawyer Brad Edwards. “The people we are speaking to are underage victims in Florida and in New York. They are not individuals whose claims have previously been part of any law enforcement investigation,” Scarola said. […] “I believe that there was a fairly effective message that was delivered by New York authorities that victims need not fear that they will be treated in the same way that victims had been treated in South Florida,” Scarola said


[..] But New York prosecutors – who say they found “an extraordinary volume of photographs of nude and partially nude young women and girls” while executing a search warrant at his Manhattan residence last weekend – have already argued that he’s likely to either flee the country or add to what they say are dozens of victims as young as 14 from New York to Palm Beach. “I don’t care if he gives up his license and his jet, he still has the wherewithal to take off any time,” said Spencer Kuvin, a Palm Beach attorney who represents three Epstein accusers. “Think about it – if he was a plumber in Queens, do you think the judge would say ‘Yeah, let’s give him an ankle bracelet and send him home?'”

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But then he provides no evidence. Is that an ambassador’s job?

New Envoy Leak Claims Trump Scrapped Iran Nuclear Deal ‘To Spite Obama’ (BBC)

Donald Trump abandoned the Iran nuclear deal to spite Barack Obama, according to a leaked memo written by the UK’s former ambassador to the US. Sir Kim Darroch described the move as an act of “diplomatic vandalism”, according to the Mail on Sunday. It says the memo was written after the then Foreign Secretary Boris Johnson appealed to the US in 2018 to stick with the nuclear deal. Under that agreement Iran agreed to limit its sensitive nuclear activities. It would also allow in international inspectors in return for the lifting of crippling economic sanctions. However, President Trump did not think that the deal went far enough.


The newspaper reports that after Mr Johnson returned to the UK from the US, Sir Kim wrote that President Trump appeared to be abandoning the nuclear deal for “personality reasons” because the pact had been agreed by his predecessor, Barack Obama. The British ambassador is said to have highlighted splits amongst US presidential advisors and that the White House did not have a “day-to-day” strategy of what to do following withdrawal from the deal. The paper reports that Sir Kim wrote a memo to Mr Johnson, saying: “The outcome illustrated the paradox of this White House: you got exceptional access, seeing everyone short of the president; but on the substance, the administration is set upon an act of diplomatic vandalism, seemingly for ideological and personality reasons – it was Obama’s deal.

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They’re going to keelhaul him/her, set an example.

Suspected Leaker of UK Ambassador Cables Identified (R.)

The suspect behind the leak of confidential memos from Britain’s Washington ambassador has been identified, the Sunday Times newspaper has reported. British officials have launched an inquiry to find the person responsible for the leak of emails published by the Mail on Sunday. Counter-terrorism police have launched a criminal investigation. According to the Sunday Times, which cited unnamed government sources, a suspect had been identified and suggestions that it could be the result of a computer hack by a foreign state had been ruled out. “They think they know who did the leaking,” an unnamed government source told the paper.


“It’s now a case of building a case that will stand up in court. It was someone with access to historical files. They went in and grabbed a range of material. It was quite crude.” Both the Sunday Times and the Mail on Sunday reported that intelligence officials from the GCHQ eavesdropping spy agency were about to join the investigation to find the suspect by examining email and phone records. The Mail on Sunday published newspaper published memos from Kim Darroch in which he described Donald Trump’s administration as “inept” and “dysfunctional“, prompting an angry response from the US president and causing the envoy to announce his resignation. It has now published further memos from Darroch, defying a police warning that doing so could be a criminal act.

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What a pitiful little country Britain has become. Stumbling from blunder to blunder.

UK Says Iran Tanker Will Be Freed After Guarantees On Destination (AFP)

British Foreign Secretary Jeremy Hunt sought to ease tensions with Iran on Saturday, saying a tanker held by Gibraltar would be released if Tehran guaranteed it was not heading to Syria. He said he had a “constructive call” with his Iranian counterpart Mohammad Javad Zarif, who he said assured him that Tehran “is not seeking to escalate” tensions between the countries. “I reassured him our concern was destination not origin of the oil on Grace One,” a tanker seized off the coast of the tiny British territory of Gibraltar on July 4, Hunt tweeted. An Iranian statement confirmed the conversation and said Hunt underlined Iran’s “right to export oil”. It added that Tehran hoped that an investigation in Gibraltar into the seized ship “would lead quickly to the release of the Iranian tanker”.


US officials believe the tanker was destined for Syria to deliver oil, in violation of separate EU and US sanctions. Hunt said Britain “would facilitate release if we received guarantees that it would not be going to Syria, following due process in Gib (Gibraltar) courts. “Was told by FM Zarif that Iran wants to resolve issue and is not seeking to escalate.” Tehran had reacted angrily to the seizure, and Britain this week said Iranian military vessels had tried to “impede the passage” of a British oil tanker in the Strait of Hormuz. Iran, in its statement relayed by state media, said Zarif had told Hunt that his country would continue to export its oil “in all circumstances” and that the Grace One’s destination was a “legal” one, in “the eastern Mediterranean”. He did not specify where.

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Overall aversion against anything China. Not sure that helps.

The Spirit Of Rebellion Spreads In Hong Kong (G.)

An old Chinese idiom has become the key catchphrase of Hong Kong’s social discourse in recent days. Pien Dei Hoi Fa – flowers blooming everywhere – is the term being used to describe the emergence of local protests and so-called Lennon walls, colourful collages of sticky labels with political messages, that are popping up in local communities all over Hong Kong. Millions in this former British colony have flocked to the streets in several mass protests over the past month to fight against a proposed law that would allow individuals to be extradited to stand trial in China’s opaque courts. Now, feeling emboldened by the solidarity and big turnout at recent protests, which have made headlines across the world, Hong Kong people are now riding on the wave of their success to speak up on a range of issues, which are generally related to their discontent with the encroachment of China into Hong Kong.

Over the past weeks, there have already been many smaller scale rallies on the sidelines of the main protests, among them a couple of mothers’ rallies urging the authorities to listen to young people and numerous open-air Christian gatherings urging peace. But many more, with different themes, are in the pipeline: there are at least five planned protests or rallies over the coming week and nine until the end of the month, and lists of these are going viral on social media. On Saturday thousands of people turned out for a Reclaim Sheung Shui protest in a town near the mainland border, a show of anger against so-called parallel traders who snap up goods ranging from foreign-made formula milk to cosmetics and medicines and resell them in China.

On Sunday, a rally in Shatin against the extradition bill and a separate journalists’ march on Hong Kong island against the police’s rough handling of reporters are planned. There will be an elderly people’s march to support the young next Wednesday and a rally against pro-Beijing media in the next few weeks.

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‘..until after coup attempt anniversary..’ i.e. July 16. US, NATO can’t afford to let the S-400 anywhere near their equipment. So expulsion?

Turkey Receives More S-400 Parts As US Holds Off Retaliation (RT)

Additional S-400 air defense components have arrived in Turkey, as Washington remains unusually silent while reportedly contemplating the proper timing and degree of pain it wants to inflict on its NATO ally for disobedience. An Ilyushin Il-76 cargo plane landed at Murted Turkish Air Force Base just outside Ankara on Saturday with the latest batch of S-400 parts, the Defense Ministry confirmed, a day after three gigantic Antonov An-124 jets delivered the first components of the defense system. The cargo was welcomed by a large number of military personnel and offloaded by heavy-duty military trucks into secure hangars.

Despite the lack of immediate reaction from Washington, the White House is currently working on a sanctions package which will be invoked under the Countering America’s Adversaries through Sanctions Act (CAATSA), sources familiar with the matter told Bloomberg. The content and degree of the punitive measures have reportedly already been carefully debated between State Department and National Security Council officials together with the Pentagon. Now it is up to Trump to sign off on the package, which is unlikely to come before the end of next week, as the administration allegedly wants to “wait until after Monday’s anniversary” of the Turkey military coup attempt as to “avoid fueling further speculation” about Washington’s possible involvement.

Turkish President Recep Tayyip Erdogan blamed the failed July 15, 2016 rebellion on a cleric living in the US under CIA protection and – amid souring relations with Washington which accused Turkey of conducting a brutal crackdown on the coup plotters – began increasingly turning to Russia for defense supplies.

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BAU. Carbon is a bitch. And there are still people who can look at an entire landscape, in this case a canyon, and declare there’s nothing much there. Every landscape teems with life.

Chevron Spills 800,000 Gallons Of Oil, Water In California (AP)

Officials began to clean up a massive oil spill Friday that dumped nearly 800,000 gallons of oil and water into a California canyon, making it larger — if less devastating — than the state’s last two major oil spills. The newly revealed spill has been flowing off and on since May and has again stopped, Chevron spokeswoman Veronica Flores-Paniagua said. She and California officials said the spill is not near any waterway and has not significantly affected wildlife. The last flow was Tuesday. Chevron reported that 794,000 gallons of oil and water have leaked out of the ground where it uses steam injection to extract oil in the large Cymric Oil Field about 35 miles west of Bakersfield.


The steam softens the thick crude so it can flow more readily and is a different process from fracking, which breaks up underground layers of rock. The state has issued Chevron a notice of violation ordering it to stop steam injections around the spill. The company also increased its production of oil from wells in the area. Both actions are intended to relieve underground pressure that may be forcing the mix of oil and water to the surface.

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Jul 122019
 
 July 12, 2019  Posted by at 9:14 am Finance Tagged with: , , , , , , , , , , , , , ,  


Jack Delano Rebuilt Chicago and North Western Railroad caboose at the Proviso yard in Chicago 1943

 

Making Banking Boring Again: The Decline Of Deutsche Bank (NS)
The Parable of Deutsche Bank and Investment Banking (Wright)
Bank Of England Warns Of Lending Crisis For EU Firms After No-Deal Brexit (G.)
Epstein Sold ‘Lolita Express’ Weeks Before Arrest (ZH)
Did Pedophile Jeffrey Epstein Work for Mossad? (Giraldi)
AOC on the 2020 Presidential Race and Trump’s Crisis at the Border (NYer)
Guardian Publishes, Then Censors Jewish Open Letter Defending Labour MP (GZ)
BBC Panorama’s Hatchet Job On Labour Antisemitism (Cook)
Bitcoin Extends Losses After Fed Chief Urges Halt To Facebook’s Libra (R.)
Japan Crypto Exchange Says $32 Million Missing In Hack (AFP)
Iran Calls On Britain To Release Seized Oil Tanker Immediately (R.)
Greek Growth Expected To Recover In The Second Half Of The Year (K.)

 

 

“If Deutsche falls, it could pull many other European banks down with it.” And American banks too.

Making Banking Boring Again: The Decline Of Deutsche Bank (NS)

There once was a time when Deutsche Bank’s central purpose was to expand its investment banking operations to compete with its American counterparts. On Sunday (7 July), its CEO declared those “days of spectacular ambition” over, announcing a major restructuring in a last attempt to save the bank from collapse. In a decade of decline for the once-great European investment banks, Deutsche has fared particularly badly. In the aftermath of the financial crash, it refused a German government bailout. Regulators have since discovered it was only able to do so by fiddling its books, earning it a large fine from the US Securities and Exchange Commission. The bank has remained fragile. The IMF called it the “most important net contributor to systemic risks in the global banking system”.


If Deutsche falls, it could pull many other European banks down with it. It has also been breaking rules in pursuit of a return to profitability. It earned big post-crisis fines for its role in the Libor rigging scandal, for laundering Russian money, and for violating US sanctions against a string of countries. The bank’s share price has fallen to below €7, from a pre-crisis peak of €112. The scale of its restructuring has shocked many analysts. Having already squeezed shareholders for huge amounts of capital, Deutsche aims to pay for it by cutting costs. Eighteen thousand jobs will be lost worldwide and the bank will shift away from expensive investment banking and return to its “traditional strengths” in corporate banking.

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Quite obvious what went wrong.

The Parable of Deutsche Bank and Investment Banking (Wright)

I first started writing about Deutsche Bank in the mid-1990s as a cub reporter on a City trade paper and this week’s news made me feel quite nostalgic. My first interview as a reporter in 1996 was on an empty trading floor in the City with someone called Edson Mitchell – the uber-trader hired by Deutsche Bank in 1995 to spearhead its ambitious project. He patiently explained to a clueless reporter why the bank was hiring 500 traders and what they would soon be doing. My first front page splash a few months later was that Deutsche Bank had hired the entire Latin American equities team of about 70 people from ING Barings. Why bother building a business from the bottom up when you can just buy the people from another firm that has already done so?

Those early moves were repeated many times over. You want to build the best trading business? Hire a huge team from Merrill Lynch. You want the best equities and advisory business? Take the best team on the street from SG Warburg. In the early days of the Deutsche Bank project it had the culture of an ambitious start-up: hire large teams of very good people, pay them a ton of money, focus on revenues, scale and market share – and eventually the profits will follow. Throw in as much leverage as your balance sheet can bear, and the numbers started adding up pretty quickly. It was a simple and successful formula. Soon Deutsche Bank graduated from hiring teams to buying entire firms: its acquisition of Bankers Trust in 1998 for $10bn – the biggest ever attempt by a European bank to break into the US market – briefly made it the biggest bank in the world in terms of assets.

It snapped up Scudder Investments a few years later, and Russian investment bank UFG a few years after that. The danger was that this ambitious start-up culture became the de facto culture of the investment bank. As a business model it worked when regulators around the world were more generous with how much leverage banks could have and when everyone was printing money in the years running up to the financial crisis. In 2007 the investment bank at Deutsche generated a shade under €20bn in revenues of a balance sheet that was just shy of €2 trillion. Two thirds of that revenue came from its huge sales and trading business. Pretax profits topped €5bn and its return on equity – a measure of profitability – was just under 20%. The Deutsche Bank project had worked.

The problem with this culture and business model – or rather, collection of businesses that had been rammed together over the previous decade – was that when the music stopped in 2008 it left Deutsche Bank with a huge and unproductive balance sheet, a cost-base that was nowhere near as flexible as it should have been, and a toxic culture in which many people’s expectation of how much they should be paid had become disconnected from the reality of the day-to-day business.

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“Britain has enabled UK companies banking with EU institutions located in Britain to keep on trading in the same way, even in a no-deal scenario, under special rules legislated for by the government. However, Brussels has not taken similar steps, the Bank warned.”

Bank Of England Warns Of Lending Crisis For EU Firms After No-Deal Brexit (G.)

The Bank of England has warned that a no-deal Brexit could trigger a material shock to the UK economy while causing widespread disruption for EU companies by cutting them off from London-based banks. Stating that the risk of Britain crashing out without a deal had risen, the Bank said the City of London was ready to withstand such a scenario and avoid banks failing, as they did in the financial crisis. However, there would still be major disruption for companies. Mark Carney, the Bank’s governor, said: “The perceived likelihood of no-deal Brexit has increased since last year. Although the degree of preparedness for such a scenario has improved, material risks still remain.”

He said the absence of further action by Brussels to get ready for Brexit could leave the door open to disruption for banks and their customers in the EU, while warning that the UK would face “material economic disruption” from a no-deal departure. “Although such disruption would primarily affect EU households and businesses, it could amplify volatility and spill back to the UK in ways that cannot be fully anticipated or mitigated,” he said. Against the backdrop of a rising threat of a no-deal Brexit, the central bank used its twice yearly financial stability report to say that UK, EU and international banks operating in London had made progress planning for a disorderly departure.

However, it warned that about half of EU companies using banks registered in Britain could be cut off from their banking services after the Halloween Brexit date, as they had yet to fully prepare. Britain has enabled UK companies banking with EU institutions located in Britain to keep on trading in the same way, even in a no-deal scenario, under special rules legislated for by the government. However, Brussels has not taken similar steps, the Bank warned.

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If they let him out on bail there’ll be riots.

Epstein Sold ‘Lolita Express’ Weeks Before Arrest (ZH)

A curious footnote has appeared in a court filing by Jeffrey Epstein’s attorneys suggesting that the registered sex offender sold his infamous Boeing 727-200 weeks before his Satuday arrest on suspicion of sex-trafficking minors. While arguing for why Epstein should be allowed to remain under house arrest pending trial, his attorneys made the case that the wealthy financier would “deregister or otherwise ground his private jet,” with the footnote reading “Mr. Epstein owns one private jet. He sold the other jet in June 2019,” placing the sale just weeks before his July 6 arrest upon his return from Paris in his Gulfstream G550 according to Bloomberg.

In other words, it looks like the financier unloaded the potentially ‘evidence-rich’ aircraft – said to have had a bed installed where passengers reportedly had group sex with young girls – right before the hammer came down. According to investigative journalist Conchita Sarnoff – who first revealed the former president’s extensive flights on Epstein’s “lolita express” in a 2010 Daily Beast exposé – former president Bill Clinton flew on the ‘lolita express’ no fewer than 27 times.

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Still just a theory. I would be careful with that.

Did Pedophile Jeffrey Epstein Work for Mossad? (Giraldi)

Questions about Epstein’s wealth also suggest a connection with a secretive government agency with deep pockets. The New York Times reports that “Exactly what his money management operation did was cloaked in secrecy, as were most of the names of whomever he did it for. He claimed to work for a number of billionaires, but the only known major client was Leslie Wexner, the billionaire founder of several retail chains, including The Limited.” But whose intelligence service? CIA and the Russian FSB services are obvious candidates, but they would have no particular motive to acquire an agent like Epstein. That leaves Israel, which would have been eager to have a stable of high-level agents of influence in Europe and the United States.

Epstein’s contact with the Israeli intelligence service may have plausibly come through his associations with Ghislaine Maxwell, who allegedly served as his key procurer of young girls. Ghislaine is the daughter of Robert Maxwell, who died or possibly was assassinated in mysterious circumstances in 1991. Maxwell was an Anglo-Jewish businessman, very cosmopolitan in profile, like Epstein, a multi-millionaire who was very controversial with what were regarded as ongoing ties to Mossad. After his death, he was given a state funeral by Israel in which six serving and former heads of Israeli intelligence listened while Prime Minister Yitzhak Shamir eulogized: “He has done more for Israel than can today be said”

[..] It will be very interesting to see just how far and how deep the investigation into Epstein and his activities goes. One can expect that efforts will be made to protect top politicians like Clinton and Trump and to avoid any examination of a possible Israeli role. That is the normal practice, witness the 9/11 Report and the Mueller investigation, both of which eschewed any inquiry into what Israel might have been up to. But this time, if it was indeed an Israeli operation, it might prove difficult to cover up the story since the pedophile aspect of it has unleashed considerable public anger from all across the political spectrum. Senator Chuck Schumer, self-described as Israel’s “protector” in the Senate, is loudly calling for the resignation of Acosta. He just might change his tune if it turns out that Israel is a major part of the story.

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Yes, the US needs to improve conditions at the border, no doubt about it. But calling it Trump’s crisis while it plays out in Obama facilities is a step too far. At least get some stories about what went on there before January 2017.

And AOC saying Trump called migrants “animals” is simply false. He was referring to MS-13 gang members (see video), and it’s very hard to believe she doesn’t know that. And then he compliments her. Maybe it’s time she pays him a compliment in return. Varoufakis said it very well:

“Come on, wake up! You can not say to Trump voters that they are idiots, and Putin duped them. You can say that, but then that’s it – you lose them forever. And it’s also not true.”
– Yanis Varoufakis

AOC on the 2020 Presidential Race and Trump’s Crisis at the Border (NYer)

So, we walked in and in one of the cells, the cell is just all concrete. There were just women on a concrete floor, and then there were two concrete slabs where they could sit, and then in the back there was a toilet, and a concrete slab in front of the toilet, but no door. And these women were just in these sleeping bags on the floor over each other. There’s no way that they could all sleep at once. Almost no way. And [..] it was, it was the physical manifestation of Trump’s rhetoric in calling migrants animals.


Caption: “[Trump] was responding during a White House event to a point made by a California sheriff about the MS-13 gang, which was started in the 1980s by immigrants from Central America.”

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The UK looks to be dissolving into complete chaos. Corbyn sympathizes with the Palestinians, and this is what happens.

Guardian Publishes, Then Censors Jewish Open Letter Defending Labour MP (GZ)

Britain’s leading newspaper The Guardian, which has relentlessly attacked Jeremy Corbyn and his leftist allies, published but then quickly removed an open letter signed by Noam Chomsky defending Labour MP Chris Williamson from “anti-Semitism” smears. Britain’s leading newspaper The Guardian has censored an open letter published by prominent Jewish intellectuals, writers, and activists that defended leftist Labour Party Member of Parliament Chris Williamson from “anti-Semitism” smears. The Guardian printed, but then quickly removed the letter without explanation. Meanwhile, the paper has refused to retract a wholly discredited article that maligned journalist and political prisoner Julian Assange which has remained on the website for more than seven months.

WikiLeaks says this piece is completely false, and has pledged to sue the newspaper over it. The retracted open letter was a defense of Chris Williamson emphasizing that the socialist and anti-imperialist MP “has a longer record of campaigning against racism and fascism than most of his detractors,” and “stands as we do with the oppressed rather than the oppressor.” Among the more than 100 signatories on the missive are world-renowned intellectual Noam Chomsky, accomplished scholar Norman Finkelstein, anti-war activists Medea Benjamin and Ariel Gold, legal expert and former UN special rapporteur Richard Falk, Holocaust survivors, Israeli dissidents, and leaders of progressive Jewish organizations in the United Kingdom.

Chris Williamson has been a key Corbyn ally in Parliament, advancing a staunchly progressive anti-war and anti-imperialist politics at a time when many Blairite holdovers in the Labour Party are pushing for more aggressive and bellicose policies against Russia, China, Venezuela, Iran, and Syria. Williamson was suspended in February after making comments which were later misrepresented by anti-Corbyn activists. He lamented that the Labour Party, which had “done more to stand up to racism is now being demonised as a racist, bigoted party.” “I’ve got to say I think our party’s response has been partly responsible for that because in my opinion,” the MP added. “We’ve backed off far too much, we’ve given too much ground, we’ve been too apologetic.”

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Britain has a whole bunch of right wing papers, and then there’s the Guardian that has the same agenda phrased slightly differently, and then there’s the BBC. The media environment is perfect for smear jobs. Watch Assange.

There’s no way out anymore.

BBC Panorama’s Hatchet Job On Labour Antisemitism (Cook)

It is difficult to describe as anything other than a hatchet job the BBC Panorama special this week that sought to bolster claims that the Labour Party under Jeremy Corbyn has become “institutionally antisemitic”. The partisan tone was set from the opening shot. A young woman whose name was not revealed tearfully claimed to have been abused with antisemitic taunts at a Labour Party conference. The decision not to disclose the interviewee’s identity is understandable. It would have discredited the whole narrative Panorama was trying so hard to build. The woman’s name is Ella Rose, a senior official in the Jewish Labour Movement (JLM), an organisation representing Jewish and non-Jewish members of Labour at the forefront of attacks on Corbyn.

Rose has a secret past too: she once worked at the Israeli embassy in London. Two years ago she and other JLM officials were exposed collaborating with Shai Masot, an Israeli embassy official. He had to be hurriedly removed from the UK after an undercover Al Jazeera documentary showed him plotting with activists in the Labour and Conservative parties to discredit British politicians seen as a threat to Israel. Most observers believe that Masot was operating within the embassy, as part of Israel’s strategic affairs ministry, which in turn has been running black ops against western critics of Israel. Corbyn, we can safely assume, is high on that list. Rose is on record as saying she was a close friend of Masot’s.

[..] Why, one can reasonably ask, did Panorama ignore Jewish Voice for Labour in this supposed “investigation” of Labour and anti-semitism? The group was specifically set up by Jewish members to counter the claims being made by activists like Rose. Groups like the Jewish Labour Movement have implied that Jewish supporters of Corbyn are the “wrong kind of Jews” – an extremely ugly insinuation that Panorama appeared to endorse by entirely sidelining them. This was one of the reasons the Labour leadership censured the programme-makers in a 50-page document presented to BBC boss Tony Hall, in which it argued that Panorama had “pre-determined the outcome of its investigation”.

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Trump doesn’t like crypto either. He thinks there should be banking charters required.

Bitcoin Extends Losses After Fed Chief Urges Halt To Facebook’s Libra (R.)

Bitcoin dipped almost 8% on Thursday, extending losses the day after U.S. Federal Reserve Chairman Jerome Powell called for a halt to Facebook’s Libra cryptocurrency project until concerns ranging from privacy to money-laundering were addressed. The original cryptocurrency initially fell 7.7% to $11,164 in early morning trade, following a 3.8% slide on Wednesday after Powell’s testimony on monetary policy before the U.S. House of Representatives Financial Services Committee. It was last down 4.5%. Other major cryptocurrencies including Ethereum and Ripple’s XRP fell by similar levels.


“This is a direct response to the Powell testimony and comments on Facebook’s Libra and the implications that could have for the entire cryptocurrency space,” said Craig Erlam, senior market analyst at FX trading platform OANDA. “Libra raises many serious concerns regarding privacy, money laundering, consumer protection and financial stability,” Powell told the committee, adding that he did not think the project could proceed unless those concerns were addressed.

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Hot wallets appear weak.

Japan Crypto Exchange Says $32 Million Missing In Hack (AFP)

A Tokyo-based cryptocurrency exchange said Friday it had halted all services after losing cryptocurrency worth more than $32 million in the latest apparent hack involving virtual money. Remixpoint said its subsidiary BITPoint Japan discovered overnight that about 3.5 billion yen ($32.3 million) in various digital currencies had gone missing from its management. The apparent hack was discovered after an error appeared in the firm’s outgoing funds transfer system on Thursday night. It said the cryptocurrency went missing from a so-called “hot wallet”, which is connected to the internet, but that currency held in “cold wallets” that are offline was not affected.


BITPoint Japan handles various virtual currencies, including bitcoin, ethereum and ripple. Remixpoint said the firm was still analysing the loss and offered no further details. It said it would compensate customers for the losses. Around 2.5 billion yen worth of the missing currency was customer funds, with the rest owned by the firm. Remixpoint shares plunged 18.6 percent following the announcement.

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It’s like Venezuela. Aggression gone completely wrong.

Iran Calls On Britain To Release Seized Oil Tanker Immediately (R.)

Iran called on Britain on Friday to immediately release an oil tanker that British Royal Marines seized last week on suspicion it was breaking European sanctions by taking oil to Syria, a foreign ministry spokesman told state news agency IRNA. “This is a dangerous game and has consequences … the legal pretexts for the capture are not valid … the release of the tanker is in all countries’ interest,” the spokesman, Abbas Mousavi, said. Iran has warned of reciprocal measures if the tanker is not released.


Britain said on Thursday that three Iranian vessels tried to block a British-owned tanker passing through the Strait of Hormuz, which controls the flow of Middle East oil to the world, but backed off when confronted by a Royal Navy warship. Iran denied that its vessels had done any such thing. Tension between Iran and the West has increased a week after Britain seized the tanker and London said the British Heritage, operated by oil company BP, had been approached in the strait between Iran and the Arabian peninsula. Mousavi accused Britain of seizing the tanker under U.S. pressure. “Such illegal measures could increase tensions in the Persian Gulf,” he told IRNA.

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Oh, sure, the new right wing government will make things look like they recover. But the EU squeeze is still on and growth will only be a mirage. Watch the poor get poorer. As long as Greece has to have a 3.5% budget surplus, taking all that direly needed money out of its economy, growth is mathematically impossible.

Greek Growth Expected To Recover In The Second Half Of The Year (K.)

The Greek economy is expected to regain its growth momentum in the second half of the year, after a slowdown in the previous quarters, as a result of increased confidence and favorable monetary conditions, a report by the financial analysis department of the National Bank of Greece argues. The report projects that after a drop in the growth rate in late 2018 and at the start of 2019, economic activity is set to rebound in July-December, with the main indexes reflecting a trend for strengthening consumption and for increased investments.


Nevertheless, the NBG report adds that increased exports are making the economy more vulnerable to the slowdown of the European economy. This, it says, is also reflected in the stagnation of international tourism arrivals over the first four months of the year, on a year-on-year basis. The bank’s baseline scenario provides for a zero increase to tourism revenues in 2019 from the record year of 2018.

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Mexico wants out of the EU

 

 

 

 

Jul 112019
 
 July 11, 2019  Posted by at 8:53 am Finance Tagged with: , , , , , , , , , , , , , ,  


Pablo Picasso Guernica 1937

 

Dollar Slips After Powell Bolsters Rate Cut Bets (R.)
AOC Is Making Monetary Policy Cool (and Political) Again (NYM)
Trump Tasks Aides To Find A Way To Weaken The US Dollar (CNBC)
Lock Him Up (Pinkerton)
Schumer Got Thousands In Donations From Jeffrey Epstein (NYP)
Democrat Rep. Stacey Plaskett To Donate Epstein Campaign Contributions (CNBC)
US Probing Deutsche Bank’s Dealings With Malaysia’s 1MDB (ZH)
Obama the Conservative vs Trump the Revolutionary (EH)
Former UK PM Major Vows To Block Brexit Parliament Suspension (R.)
OPCW’s New Chemical Weapons Team To Launch First Syria Investigations (R.)
UK, US Claim Iranian Boats Attempt To Seize Tanker In Strait Of Hormuz (ZH)

 

 

I’m getting so sick of this. Powelll wants to cut rates but it makes no sense if he’s to uphold Trump’s claim of a great US economy. So what does his spin team come up with? Cut rates because other countries are not doing so well. Cut the crap.

Dollar Slips After Powell Bolsters Rate Cut Bets (R.)

The dollar eased on Thursday after Federal Reserve Chairman Jerome Powell set the stage for a rate cut later this month, vowing to “act as appropriate” to ensure the world’s biggest economy will be able to sustain a decade-long expansion. In testimony to Congress, Powell pointed to “broad” global weakness that was clouding the U.S. economic outlook amid uncertainty about the fallout from the Trump administration’s trade conflict with China and other nations. “Chairman Powell sounded dovish on most dimensions. This is slightly surprising given benign trade developments following last month’s G20 meeting and the recent rebound in nonfarm payrolls,” said Michael Swell, co-head of global fixed income portfolio management at Goldman Sachs Asset Management.


“Overall, his comments around slowing growth against a backdrop of muted inflation and elevated uncertainties is consistent with ‘insurance rate cuts’ this year.” Adding to a generally dovish tone in his testimony, the minutes from the Fed’s previous policy meeting showed many policymakers thought more stimulus would be needed soon, reviving speculation of an aggressive rate cut.

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And AOC also wants low interest rates. Everyone wants the same thing, and nobody says: Wait a minute?!

AOC Is Making Monetary Policy Cool (and Political) Again (NYM)

Ocasio-Cortez : In early 2014, the Federal Reserve believed that the long run unemployment rate was around 5.4 percent. In early 2018, it as estimated that this was now lower, around 4.5 percent. Now, the estimate is around 4.2 percent. What is the current unemployment rate today?
Powell : 3.7 percent.

Ocasio: 3.7 percent…Unemployment has fallen about three full points since 2014 but inflation is no higher today than it was five years ago. Given these facts, do you think it’s possible that the Fed’s estimates of the lowest sustainable unemployment rate may have been too high?
Powell : Absolutely.

This exchange may sound dull and technical. But the congresswoman’s point has real human stakes. America’s central bank has a dual mandate: to promote full employment and price stability. How the Fed chooses to balance those two objectives has redistributive implications. The wealthy have far more to lose from inflation than they do from modest levels of unemployment. In fact, many business owners may actually prefer for the U.S. economy not to achieve full employment, since workers tend to be less demanding when jobs are scarce. By contrast, the most vulnerable workers in the U.S. — such as those with criminal records or little experience — will struggle to get a foothold in the labor market unless policy makers err on the side of letting unemployment fall “too low.”

And this is what AOC’s questions are implicitly about. If the Federal Reserve believes that the U.S. economy cannot sustain unemployment below 5 percent without suffering high inflation, then it will raise interest rates to cool off investment, thereby preventing too many workers from getting jobs. Ocasio-Cortez’s implication is that, by raising interest rates out of a fear of illusory inflation, the Fed may have needlessly hurt American workers. Powell’s concession on that point is significant, and suggests that the central bank will be less inclined to err on the side of hurting the vulnerable in the future.

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We’re all of us in the gutter… (but apparently there’s no-one left looking at the stars).

Trump Tasks Aides To Find A Way To Weaken The US Dollar (CNBC)

President Donald Trump has reportedly tasked aides to find a way to weaken the U.S. dollar in an effort to boost the economy ahead of the 2020 presidential election. The president also asked about the greenback while interviewing Federal Reserve board nominees Judy Shelton and Christopher Waller, people familiar with the matter told Bloomberg News. Those individuals also told Bloomberg that Trump’s chief economic advisor, Larry Kudlow, and Treasury Secretary Steven Mnuchin disapprove of the idea of government tampering to weaken the dollar. Traditionally, past administrations have always maintained publicly they were for a strong dollar because dollar assets like Treasurys are so widely held around the globe.


Trump has often bemoaned the relative strength of the U.S. dollar in foreign exchange markets, blaming foreign nations for devaluing their currencies and thereby inflating the American trade deficit. Last week, the president said in a tweet that the U.S. should match China and Europe’s “currency manipulation game.” “China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA,” Trump said on Twitter. “We should MATCH, or continue being the dummies who sit back and politely watch as other countries continue to play their games – as they have for many years!”

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About Epstein, but with a historical twist.

Lock Him Up (Pinkerton)

One landmark of American reform was the White-Slave Traffic Act, signed into law in 1910 (“white slavery,” we might note, is known today as “sex trafficking”). That law, aimed at preventing not only prostitution but also “debauchery,” is known as the Mann Act in honor of its principal author, Representative James R. Mann, Republican of Illinois, who served in Congress from 1897 to 1922. Mann’s career mostly coincided with the presidential tenures of two great reformers, Theodore Roosevelt and Woodrow Wilson. And it’s hard to overstate just how central to progressive thinking was the combatting of “vice.” After all, if the goal was to create a just society, it also had to be a wholesome society; otherwise no justice could be sustainable.

Thus when Roosevelt served as police commissioner of New York City in the mid-1890s, he focused on fighting vice, rackets, and corruption. Of course, Mann, Roosevelt, and Wilson had much more on their minds than just cleaning up depravity. They saw themselves as reformers across the board; that is, they were eager to improve economic conditions as well as social ones. So it was that Mann also co-authored the Mann-Elkins Act, further regulating the railroads; he also spearheaded the Pure Food and Drug Act, creating the FDA. It’s interesting that when Mann died in 1922, The New York Times ran an entirely admiring obituary, recalling him as “a dominating figure in the House…[a] leader in dozens of parliamentary battles.” In other words, back then, the Times was fully onboard with full-spectrum cleanup, on the Right as well as the Left.

To be sure, the Mann Act hardly eradicated the problem of sex-trafficking, just as Mann’s other legislative efforts did not put an end to abuses in transportation and in foods and drugs. However, we can say that Mann made things better. Of course, the Mann Act has long been controversial. Back in 1913, the African-American boxer Jack Johnson was convicted according to its provisions. (Intriguingly, in 2018, Johnson was posthumously pardoned by President Trump.) In 1944, film legend Charlie Chaplin, too, found himself busted on a Mann Act rap. Chaplin was accused of transporting a young “actress” across state lines; he was acquitted after a sensational trial, but not before it was learned that he had financed his lover’s two abortions. Chaplin’s career in Hollywood was effectively over.

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Schumer telling others what to do, but doing dick all himself. How much did the Clinton Foundation get?

Schumer Got Thousands In Donations From Jeffrey Epstein (NYP)

Sen. Chuck Schumer — who called on Labor Secretary Alexander Acosta to resign and said President Trump should “answer” for his friendship with Jeffrey Epstein — accepted thousands of dollars in donations from the alleged pedophile throughout the 1990s, The Post has learned. Federal Election Commission records show that Schumer received seven $1,000 donations from Epstein between 1992 and 1997, first as a U.S. congressman from New York and then when he was vying to be the state’s senator in 1998, an election he won. Epstein — who was arrested Saturday and charged with sex trafficking and a related conspiracy count for allegedly sexually abusing a vast network of underage girls — also gave $10,000 to “Victory in New York,” a joint fundraising committee established by Schumer and the Democratic Senatorial Campaign Committee.

Epstein gave an additional $5,000 to “Win New York,” a Schumer-associated joint committee that benefited the Liberal Party of New York State. Both of Epstein’s donations to the committees came in October 1998 — and look to have primarily benefited the DSCC and the Liberal Party of New York, as Epstein would have already met the $2,000 limit of donating individually to Schumer. At the time, donors could give $1,000 to a candidate per election — once in the primary and again in the general. That means Schumer and Schumer-linked entities received a combined $22,000.

On the Senate floor Tuesday, Schumer made three Epstein-related demands. He first called on Acosta to resign. [..] “Instead of prosecuting a predator and serial sex trafficker of children, Acosta chose to let him off easy,” Schumer said on the floor. “This is not acceptable. We cannot have, as one of the leading appointed officials in America, someone who has done this.” Schumer also asked that the Department of Justice’s Office of Professional Responsibility make public its review of Acosta’s handling of the case. Finally, Schumer said that Trump should paint a fuller picture of what he meant when he called Epstein a “terrific guy” in a 2002 article for New York Magazine.

An April 2011 court filing shows that Trump eventually barred Epstein from Mar-a-Lago “because Epstein sexually assaulted a girl at the club,” the documents allege. Trump didn’t officially launch a political career until June 2015. No FEC records show that Epstein was ever a Trump donor.

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So when will Schumer follow suit? And the rest of them?

Democrat Rep. Stacey Plaskett To Donate Epstein Campaign Contributions (CNBC)

Democratic congresswoman Stacey Plaskett has decided to reverse course and will give away the contributions she has received from Jeffrey Epstein, who is accused of child sex trafficking. The move comes a day after her team told CNBC that she was unlikely to return the campaign donations after Epstein’s arrest. “In light of new information and allegations that have been made against Jeffrey Epstein I have decided to make contributions to Virgin Islands organizations that work with women and children in the amount of his previous contributions,” Plaskett said in a statement Tuesday.

“My litmus test for accepting campaign contributions has been based on whether the donor’s money was made legally or by ill-gotten means and that the contributor will not ask of me or my Congressional office for any special favors. All my contributions have passed that test. In this case however, I am uncomfortable having received money from someone who has been accused of these egregious actions multiple times,” said Plaskett, who represents the U.S. Virgin Islands in the House as a delegate. Her spokesman Mike McQueery later noted the Epstein donations will be given to The Women’s Coalition and The Family Resource Center.

Her initial announcement led to an outcry on social media, with prominent Democratic strategists such as Adam Parkhomenko calling on Plaskett to give the money over to a nonprofit organization such as the Rape, Abuse & Incest National Network. Since Epstein pleaded not guilty Monday, Plaskett is the first politician to say she is giving away donations from Epstein.

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Deutsche severed ties with Epstein just months ago.

US Probing Deutsche Bank’s Dealings With Malaysia’s 1MDB (ZH)

When it rains inside the halls of Deutsche Bank, the flood is biblical. Just when it seemed that the biggest (if not for long) German bank, already reeling from the biggest mass layoffs since Lehman, couldn’t possibly bear any more bad news, along comes the US government with yet another potentially criminal investigation, this time over Deutsche Bank’s involvement with the sprawling, multibillion-dollar Malaysian development fraud scandal that toppled a prime minister, crippled Goldman Sachs stock and stretched from Hollywood to Wall Street. According to the WSJ, the DOJ is investigating whether the German bank violated foreign corruption or anti-money-laundering laws in its work for the 1Malaysia Development Bhd. fund, or 1MDB, which included helping the fund raise $1.2 billion in 2014 as concerns about the fund’s management and financials had begun to circulate.

So how did Deutsche Bank get thrown into yet another scandal? It turns out that DB was snitched out by former Goldman banker, Tim Leissner, the man who was ground zero in the original 1MDB scandal, and who ended up costing Goldman billions in dollar in market cap as its stock tumbled last year as its role in the biggest Malaysian corruption scandal got exposed, and according to some, cost Lloyd Blankfein his job. As it turns out, Leissner is now cooperating with authorities, and among his “good Samaritan” duties decided to throw the one bank that has more dirt on it than Goldman: Deutsche Bank. As we have reported extensively in the past, prosecutors have been investigating similar issues at Goldman, where Leissner, a former managing director, pleaded guilty last year and admitted to earlier helping siphon off billions of dollars from the fund.

[..] But wait, there’s more! Because roughly at the same time as DB’s potential role in the 1MDB scandal was exposed by the WSJ, both the NYT and Bloomberg reported that the German bank had extended relations with yet another, even more scandalous figure: Jeffrey Epstein. According to NYT, Epstein “appears to have been doing business and trading currencies through Deutsche Bank until just a few months ago.” But as the possibility of federal charges loomed, the bank ended its client relationship with Epstein. It is not clear what the value of those accounts were at the time they were closed. Bloomberg confirms, reporting that “Deutsche Bank severed business ties with Jeffrey Epstein earlier this year, just as federal authorities were preparing to charge the financier with operating a sex-trafficking ring of underage girls [..] “

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Nice take by Ed Harrison. I’m no big fan of these alleged sharp divisions between generations, though.

Obama the Conservative vs Trump the Revolutionary (EH)

I would argue that [Obama] ran for President in 2008 on a slogan – Change You Can Believe In – which very much fits his generation, late baby boom reaching across to the early Gen X’ers. “Change you can believe in” is a moniker designed to evoke a sense of technocratic tweaking, of taking a good system and making it more efficient and more fair for all citizens. It is not a call for revolution. What Obama was saying was essentially, “I am going to take the system we have – the best that man has created – and make it better.” He was not saying, “the system is rigged. The system is broken. And I’m going to burn it down and build up something better.”

Obama’s message was a conservative message. It was a message that was steeped in the status quo, with the change coming only at the margin. It meant continuity in policy and a bevy of tried and trusted policymakers to get us to the next destination. Even Obamacare is a tweak of the existing policy. It is not a fundamentally different healthcare system controlled by different healthcare providers. [..] Donald Trump doesn’t think that way. Norms only matter to him to the degree they move his personal agenda forward. He’s a pretty simple guy in this sense. If a policy choice or a norm helps Donald Trump, then he’s for it. If it hurts him, he’s against it. It’s as simple as that. But, that’s not conservative …at all. Trump may message “Make America Great Again”. But, his process is more about bending and breaking rules, damn the consequences.

None of this is to say that Millennials would support Trump over Obama because they want change. It’s more that Obama’s ‘change you can believe in’ approach was a very incremental, status quo-oriented conservative approach that has disappointed Millennials. They want still more change – not a bend and break the rule kind – but a fundamental systemic change. What does that mean about the next economic downturn? Personally, I think it means that — when people living in precarious at-will employment, with insufficient healthcare coverage, saddled by student debt, unable to purchase homes to build wealth feel the full bore of an economic downturn — they will be willing to burn the system down. They will have no allegiance to the status quo and will vote accordingly.

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Oh, c’mon, wouldn’t it be highly fitting if the Queen were to hammer the final nail into British democracy?

Former UK PM Major Vows To Block Brexit Parliament Suspension (R.)

Former British prime minister John Major vowed on Wednesday to go to court to block his party colleague Boris Johnson from suspending parliament and dragging the queen into a constitutional crisis to deliver a no-deal Brexit. Johnson, the favourite to win a Conservative leadership election and so become the next prime minister, has refused to rule out suspending, or proroguing, parliament to ensure Britain leaves the European Union on Oct. 31 — with or without a deal. That could provoke a constitutional crisis in one of the world’s oldest and most stable democracies because parliament is opposed to a disorderly exit, lacking a transition deal to ease the economic dislocation of leaving the bloc.

While it is essentially up to the prime minister to make the decision, Major, an opponent of Brexit who has not shied away for criticising his party on the issue, said it would require the queen’s blessing. “In order to close down parliament, the prime minister would have to go to Her Majesty the Queen and ask for her permission to prorogue,” he told BBC Radio. “If her first minister asks for that permission, it is almost inconceivable that the queen will do anything other than grant it. “She is then in the midst of a constitutional controversy that no serious politician should put the queen in the middle of. If that were to happen, there would be a queue of people who would seek judicial review. I for one would be prepared to go and seek judicial review.”

Major accused Johnson of hypocrisy for backing Brexit to secure more power for Britain’s parliament, only to propose to sideline lawmakers when it suited him. He said parliament had not been suspended since King Charles I did so during the English Civil War. Charles was eventually executed, in 1649.

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The OPCW killed its own credibility, thoroughly. Disband it.

OPCW’s New Chemical Weapons Team To Launch First Syria Investigations (R.)

A new team established by the global chemical weapons watchdog to attribute blame for the use of banned munitions in Syria will investigate nine alleged attacks during the country’s civil war, including in the town of Douma, sources briefed on the matter told Reuters. The Organisation for the Prohibition of Chemical Weapons (OPCW) was created in 1997 as a technical body to enforce a global non-proliferation treaty. Until now it had been authorised only to say whether chemical attacks occurred, not who perpetrated them. Last June, the Investigation and Identification Team (IIT) was established by the OPCW’s member states during a special session, a move that has brought deeper political division to the U.N. -backed agency.


Now it has identified the locations of its first investigations to be conducted in the coming three years. A document circulated to OPCW member states, a copy of which was seen by Reuters, said the team “has identified a non-exhaustive provisional list of incidents on which it intends to focus its investigative work” between 2014 and 2018. The British-led proposal creating the 10-member team was supported by the United States and European Union, but opposed by Russia, Iran, Syria and their allies. Syria has refused to issue visas to the team’s members or to provide it with documentation, OPCW chief Fernando Arias said in comments to member states published last month.

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Where’s the credibility in this case?

UK, US Claim Iranian Boats Attempt To Seize Tanker In Strait Of Hormuz (ZH)

With the Persian Gulf uncharacteristically quiet in recent days, without any material provocation either real or staged, late on Wednesday CNN reported that five armed Iranian Islamic Revolutionary Guard boats unsuccessfully tried to seize a British oil tanker in the Persian Gulf. There was no independent verification of the report, but instead it was once again sourced to those who stands to gain the most from a way with Iran, namely “two US officials with direct knowledge of the incident.” According to the report, the British Heritage tanker was sailing out of the Persian Gulf and was crossing into the Strait of Hormuz area when it was approached by the Iranian boats.


The Iranians ordered the tanker to change course and stop in nearby Iranian territorial waters, according to the officials. A US aircraft was overhead and recorded video of the incident, although so far a video has not been released. In addition to the US aircraft escort, the UK’s Royal Navy frigate HMS Montrose had been escorting the tanker, and during the confrontation, it trained its deck guns on the Iranians and gave them a verbal warning to back away, which they did. Montrose is equipped on the deck with 30 mm guns specifically designed to drive off small boats. The frigate was in the region performing a “maritime security role” according to a prior notification from UK officials.

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Seen at the inane Defend Media Freedom conference in the UK.

 

 

 

‘Man goes to a psychiatrist. He says, “I keep thinking I’m a dog.” Psychiatrist says, “OK, let’s get you on the couch.” Man says, “I’m not allowed on the couch.”‘

 

 

 

 

Jul 072019
 
 July 7, 2019  Posted by at 9:12 am Finance Tagged with: , , , , , , , , , , ,  


Pablo Picasso Guernica [Study] 1937

 

Trump Administration Is ‘Inept And Insecure’ – UK Ambassador (BBC)
Trump Couldn’t Ignore Contradictions of His Foreign Policy Any Longer (Atl.)
China Looks At Britain And Sees Only Weakness And Hypocrisy (O.)
Deutsche To Fire 20,000, Bad Bank Soars To €80BN, 5x DB’s Market Cap (ZH)
Iran To Lift Uranium Enrichment To 5%, Above Level In 2015 Deal |(R.)
Macron Warns Rouhani Of Consequences If Nuclear Deal Weakened (R.)
Bought Politicians (Craig Murray)
China Station Next Target For Hong Kong Protesters (AFP)
UN Chief Bachelet’s Venezuela Report Follows US Regime Change Script (GZ)
Second Migrant Rescue Boat Defies Salvini And Docks In Italy (AFP)
Sea-Watch Captain To Sue Italian Minister Salvini For Defamation (ToM)
Greeks Vote In Snap General Election (BBC)

 

 

This guy sends secret notes calling the US government ‘inept’, to his own government which is what exactly?

Does he do this because he knows they will love to forget their own incompetence?

And do I detect a sense of regret that Trump was “never fully on board” with the Iran bombings?

Trump Administration Is ‘Inept And Insecure’ – UK Ambassador (BBC)

The Trump administration has been labelled “inept”, insecure and incompetent in leaked emails from the UK ambassador to Washington. Sir Kim Darroch said that the White House was “uniquely dysfunctional” and “divided” under Donald Trump. But he also warned that the US president should not be written off. The Foreign Office said the leak of the memos to the Mail on Sunday was “mischievous” but did not deny their accuracy. The White House has not yet responded to the revelation of the contents of the memos, but it could test the so-called “special relationship” between the US and UK.

In the messages, Sir Kim said: “We don’t really believe this administration is going to become substantially more normal; less dysfunctional; less unpredictable; less faction-riven; less diplomatically clumsy and inept.” He questioned whether this White House “will ever look competent”. Although Sir Kim said Trump was “dazzled” by his state visit to the UK in June, the ambassador warns that his administration will remain self-interested, adding: “This is still the land of America First”.

Differences between the US and the UK on climate change, media freedoms and the death penalty might come to the fore as the countries seek to improve trading relations after Brexit, the memos said. To get through to the president, “you need to make your points simple, even blunt”, he said. In a message sent last month, Sir Kim branded US policy on Iran as “incoherent, chaotic”. Mr Trump’s publicly stated reason for calling off an airstrike against Tehran with 10 minutes to go – that it would cause 150 casualties – “doesn’t stand up”, Sir Kim said. Instead, he suggested the president was “never fully on board” and did not want to reverse his campaign promise not to involve the US in foreign conflicts.

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Everyone wants Bolton to stay in Outer Mongolia.

Trump Couldn’t Ignore Contradictions of His Foreign Policy Any Longer (Atl.)

As during the previous twist in the narrative, Trump now finds himself with a national-security team out of sync with his preferences. Changes are inevitable. Pompeo will likely survive. He is nothing if not adaptable. After the Iran decision, he and Vice President Mike Pence let it be known that although they supported military action, they were equally enthusiastic about the president’s U-turn. It’s hard to see how Bolton can stay. Trump has long known that Bolton wants war more than he does. He sidelined him on North Korea and overruled him on Iran. For his part, Bolton has privately attacked Pompeo, long a Trump favorite, as falling captive to the State Department bureaucracy and has predicted that the North Korea policy will fail.

Bolton has given an unusually large number of interviews to reporters and has been rewarded with positive profiles lauding his influence and bureaucratic prowess. Those of us who predicted that he would cling to the post of national security adviser, as it would be the last job he’d ever get, may have been wrong. In fact, Bolton looks and sounds as if he is preparing to exit on his own terms. Better that than being sent on a never-ending tour of the world’s most obscure places. For Bolton, leaving because he’s too tough for Trump is the perfect way to save face. Otherwise, he may be remembered as the man who presided over one of the weakest national-security teams in modern American history and someone whose myopic obsessions—such as international treaties and communism in Venezuela—meant the United States lost precious time in preparing for the national-security challenges of the future.

Who will replace Bolton is unclear. The best-case scenario would be Biegun, the North Korea envoy. He was rumored to be the runner-up to Bolton for the post in 2018. (Mattis and Kelly pushed for him, although at that point he had not spent time with Trump. Now he has.) Trump may see him as the man to oversee his various negotiations, as he has on North Korea. But will Trump go for a mainstream figure who would not be out of place in a traditional Republican presidency?

If the past is prelude, Trump may turn instead to his favorite source of information, Fox News, just as he did for Bolton. One of Tucker Carlson’s frequent guests on his show is a retired Army colonel by the name of Douglas Macgregor. Macgregor served in the first Gulf War and appears to be ideologically aligned with Carlson, favoring retrenchment from the Middle East and good relations with authoritarian states. His appointment would be treated as a calamity by the Republican foreign-policy establishment—which is one reason it may appeal to the president.

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The Chinese have not forgotten British atrocities, even if the Brits have.

The UK looks at the US and sees ineptness, while China looks at the UK and sees…

China Looks At Britain And Sees Only Weakness And Hypocrisy (O.)

It’s not all China’s fault. Deep-rooted anger at Britain has its origins in events largely forgotten in London but not in Beijing. It is true, as China says, that postwar colonial Britain showed scant regard for Hong Kong residents’ rights. This indifference was consistent with earlier humiliations heaped on the ruling Qing dynasty by Victorian imperialists – the cause of China’s “lost century”, concluding in 1945. The first Anglo-Chinese opium war, from 1839-42, was supposedly a response to Chinese insults to Britain’s national honour. In truth it was mostly about money and power, about imposing free trade, and about securing a lucrative market for opium exports from British India, regardless of the human cost.

This destabilising intervention opened the gates to other foreign invaders and to decades of revolts, such as the Taiping rebellion, when up to 100 million people may have died. It also foreshadowed an infamous act of cultural vandalism, the burning and looting by British and French forces of the emperor’s wondrous Summer Palace in Beijing in 1860. Its Chinese name was Yuanmingyuan – “garden of perfect brightness”. And it was utterly destroyed. All Chinese schoolchildren are taught this. Hunt deplored Beijing’s trashing of the 1984 Sino-British joint declaration, calling it an affront to the international rules-based order from which China benefits. But such righteous outrage comes awkwardly from a country that waged war in Iraq without legal authority and stays on friendly terms with murderers in Saudi Arabia.

It ignores the lawless history of the pre-1914 “unequal treaties”. Ironically, these old injustices were instrumental in shaping the Chinese communists’ 20th-century anti-imperialist, nationalist ideology – and the party’s insistence on regaining sovereignty over “lost” territories such as Hong Kong, Macau and, prospectively, Taiwan. As was often the case during its empire-building days, Britain sowed the seeds of its ultimate displacement. China’s disdain, bordering on contempt, for Britain’s warnings stems not only from London’s past hypocrisy and historical amnesia, but also from a keen assessment of its current, palpable weakness. Given the gaping power imbalance, Hunt’s threat of unspecified “severe consequences” is all but meaningless.

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Lagarde’s main job at the ECB: keep Deutsche Bank from collapsing. is that what she was hired for?

Deutsche To Fire 20,000, Bad Bank Soars To €80BN, 5x DB’s Market Cap (ZH)

One month ago, Jeff Gundlach – in his latest DoubleLine investor call – cracked jokes that Deutsche Bank’s imploding stock, which has been hitting fresh all time lows virtually every day, had “major support” at €0. Once again, he was on to something because just a few days later, the FT first reported that the bank which was this close to nationalization in 2016, and failed to consummate a merger with that “other” German bank, Commerzbank, was preparing to roll out Plan Z: amid a deep overhaul of its trading operations (read: mass terminations), the biggest German lender was set to roll out a “bad bank” holding some €50 billion in legacy toxic derivative assets, a plan that was quite popular in the depths of the global financial crisis.

As we noted at the time, it would hardly come as a surprise that the German bank best known for housing €43.5 trillion in gross derivatives notional (something we first pointed out way back in 2013) would stuff its “bad bank”, known internally also as “the non-core asset unit”, with – drumroll – long-dated derivatives. More to the point, we said that while this “bad bank” plan was commendable – after all admitting you have a problem is the first step toward recovery – it would fall far short of what is necessary to be ring-fenced from DB’s legacy balance sheet.

Today, Bloomberg confirmed as much when it reported that just two weeks after the original, €50 billion bad bank plan was floated, the German bad bank has already grown by 60%, with about €75 billion “and maybe as much as 80 billion euros of risk-weighted assets will form the basis of bad bank”, a Bloomberg source said. At the higher number, that’s the equivalent of about a quarter of Deutsche’s total balance sheet; it is also more than 5 times the German largest bank’s market cap, suggesting that absent this critical restructuring shape, Europe’s largest bank by assets is now effectively insolvent.

There is one final problem: in the summer of 2016, just a month before fears about the viability of DB sent its stock careening lower and prompting Angela Merkel to discuss whether or not DB will be nationalized, the IMF found that Deutsche Bank is “the bank that poses the greatest risk to the global financial system”: Network analysis suggests a higher degree of outward spillovers from the German banking sector than inward spillovers. In particular, Germany, France, the U.K. and the U.S. have the highest degree of outward spillovers as measured by the average percentage of capital loss of other banking systems due to banking sector shock in the source country. Here is the IMF’s chart showing the key linkages of the world’s riskiest bank:

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The West needs to cooperate with Russia and China on this. There is no other way.

Iran To Lift Uranium Enrichment To 5%, Above Level In 2015 Deal |(R.)

Iran on Sunday will announce an increase in uranium enrichment to 5%, a concentration above the limit set by its 2015 nuclear deal, an Iranian official told Reuters, in a move signaling a deepening challenge to escalating U.S. sanctions pressure. The declaration comes at a time of sharply increased U.S.-Iranian confrontation, a year after Washington quit the pact and reimposed sanctions that had been lifted under the accord in exchange for Tehran curbing its nuclear work. “The main announcement tomorrow will be the increase of the level of enrichment to 5% percent from 3.67% that we agreed under the deal,” the official said on Saturday on condition of anonymity.


In a sign of heightening Western concern, French President Emmanuel Macron said he and Iran’s President Hassan Rouhani had agreed to seek conditions for a resumption of dialogue on the Iranian nuclear question by July 15. Macron’s office added that he would keep on talking with Iranian authorities and other involved parties to “engage in a de-escalation of tensions related to Iranian nuclear issue.” The deal is aimed at extending the time Iran would need to produce a nuclear bomb, if it chose to, to a year from roughly 2-3 months. Iran says its nuclear program is only for peaceful purposes, such as power generation, and not to make bombs.

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And Iran says France should be much more vocal in its defense of Iran and the nuclear deal.

Macron Warns Rouhani Of Consequences If Nuclear Deal Weakened (R.)

French President Emmanuel Macron told his Iranian counterpart on Saturday that he was deeply concerned by any further weakening of the 2015 nuclear deal and warned that consequences would inevitably follow any such move. Macron spoke to Iranian President Hassan Rouhani a day before Iran is set to increase uranium enrichment purity above the limit set by Iran’s deal with world powers. “The president recalled his deep concern in the face of the risk of a new weakening of the 2015 nuclear accord, and the consequences that would necessarily follow,” a statement from the French presidency said. It was unclear exactly what consequences the statement was referring to.


European diplomats have said that further breaches of the accord could see the European parties to the deal – France, Britain and Germany – trigger a dispute resolution mechanism within the accord that could eventually lead to the reimposition of United Nations sanctions. Iran’s expected announcement comes at a time of sharply increased U.S.-Iranian confrontation, a year after Washington quit the pact and reimposed sanctions that had been lifted under the accord in exchange for Tehran’s curbing its nuclear work. The Iranians have demanded that the Europeans do more to save the deal by ensuring Iran gains economic benefits, notably badly needed oil revenue, which the United States has in particular targeted.

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Power for sale.

Bought Politicians (Craig Murray)

Between just 28 May and 10 June Boris Johnson received £235,500 in “private” donations, to himself personally, as he prepares to become the UK’s unelected Prime Minister. The blatant corruption of the UK’s political system is part of the reason for popular alienation from the ruling classes. It was Blair who elevated British politics to US levels of shamelessness in the matter of politicians’ self enrichment, and Johnson looks set to follow the Blair example. While some may pretend to do so, I do not accept that there is anybody who is naive enough genuinely to believe that such donations do not influence politicians’ policy decisions. Straight donations aside, the slightly disguised corruption of our political system should also be taken into account.

The banks put politicians in their pockets not through direct payments, but through massive, often six figure, fees they pay them for “speaking at dinners”. That is how Hillary Clinton garnered much of her Wall Street funding. In the case of Boris Johnson, it is interesting that in the House of Commons Register of Members’ Interests, he frequently lists the name of the speaking agency who paid him, but not who the client was. Another way to pay less obvious bribes – and one particularly pursued by New Labour – was the book deal, where publishers pay massive six figure advances to politicians which are, routinely, up to ten times the actual royalties earned for which they are an “advance”.

This only makes sense when you realise that every single one of the major publishers is owned by a much bigger multinational – for example until recently Murdoch owned HarperCollins. James Reuben, who gave two donations totaling £50,000 to Johnson, is the scion of the UK’s second wealthiest family, worth £18 billion. The Reubens made their money, like Roman Abramovich and Alisher Usmanov, in the pillaging of Russia’s massive metal producing assets, which were physically seized by gangsters, in the chaotic US organised Yeltsin privatisation process. The entire basis of their vast fortune was the exploitation of assets effectively stolen from the Russian state and people.

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Xi is itching to get involved.

China Station Next Target For Hong Kong Protesters (AFP)

Anti-government protesters in Hong Kong plan to rally later Sunday outside a controversial station where high-speed trains depart for the Chinese mainland as they try to keep up pressure on the city’s pro-Beijing leaders. The rally is the first major protest planned since last Monday’s unprecedented storming of parliament by largely young, masked protesters — a move which plunged the international financial hub further into crisis. Hong Kong has been rocked by a month of huge peaceful protests as well as a series of separate violent confrontations with police, sparked by a law that would have allowed extraditions to mainland China.


Recently opened multi-billion-dollar station that links Hong Kong to China’s high-speed rail network (AFP Photo/ANTHONY WALLACE)

The bill has since been postponed in response to the intense backlash but that has done little to quell public anger, which has evolved into a wider movement calling for democratic reforms and a halt to sliding freedoms in the semi-autonomous city. Protesters are demanding the bill be scrapped entirely, an independent inquiry into police use of tear gas and rubber bullets, amnesty for those arrested, and for the city’s unelected leader Carrie Lam to step down. Beijing has thrown its full support behind Lam, calling on Hong Kong police to pursue anyone involved in the parliament storming and other clashes.

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Excellent by Anya Parampil.

UN Chief Bachelet’s Venezuela Report Follows US Regime Change Script (GZ)

When United Nations High Commissioner for Human Rights Michelle Bachelet traveled to Venezuela earlier this year, she met with an array of citizens who lost family members to right-wing violence in the country. [..] Bachelet made no mention of opposition violence in her report. Her failure to properly detail the plight of Venezuelans who have suffered at the hands of anti-government rioters was just one of many glaring omissions which has one of the top international legal experts to have served at the UN calling the high commissioner’s objectivity into question. Alfred de Zayas became the first UN rapporteur to visit Venezuela in 21 years, traveling to the country in 2017 to examine the social and economic impact of unilateral coercive measures applied by the US.

He determined US-led sanctions were largely to blame for the country’s hardship, accusing Washington of waging “economic warfare,” and comparing its harsh measures to “medieval sieges of towns.” De Zayas was no less scathing towards Bachelet’s report, slamming it as a politicized document that depended heavily on unfounded claims by activists dedicated to Maduro’s removal. “The new Bachelet report is methodologically flawed, as were indeed the earlier reports, relying overwhelmingly on unverified allegations by opposition politicians and advocates of regime change who are only interested in weaponizing human rights,” the former special rapporteur told The Grayzone.

[..] Bachelet’s dismissal of the destructive impact of sanctions on the Maduro government overlook years of sustained economic attack on the Venezuelan economy by the most powerful nation on earth. With the Obama administration’s move to declare Venezuela’s government a “national security threat” in March of 2015, Venezuela’s economy and its ability to restructure its debt have been under systematic attack.

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“A poll published in Italy’s Corriere della Sera newspaper on Saturday said 59% of Italians approved of Salvini’s closing ports to NGO vessels. ..”

The silence from Brussels is getting louder.

Second Migrant Rescue Boat Defies Salvini And Docks In Italy (AFP)

A charity rescue vessel brought 41 shipwrecked migrants into port in Lampedusa on Saturday, the second boat to defy far-right interior minister Matteo Salvini’s bid to close Italian ports to them. Mediterranea’s Italian-flagged Alex arrived in port where a strong police presence was waiting for them but everyone remained on board after spending two days with the rescued migrants and asylum-seekers on the sailboat. “In view of the intolerable hygiene conditions aboard, the Alex has declared a state of emergency and is sailing towards Lampedusa, the only possible safe port for landing,” Mediterranea said in a tweet earlier.

Salvini, who leads the Lega party and is also deputy prime minister, last month issued a decree that would bring fines of up to €50,000 (£45,000) for the captain, owner and operator of a vessel “entering Italian territorial waters without authorisation”. Salvini tweeted after the Alex docked that the charity workers were “jackals… will they go unpunished also?” “Law enforcement forces are ready to intervene… in a normal country there would be immediate arrests and the boat would be impounded,” Salvini said in another tweet. Authorities on Lampedusa last week seized another rescue ship belonging to German aid group Sea-Watch after it forced its way into port with dozens of rescued migrants on board and arrested its captain, Carola Rackete.

An Italian judge this week ordered her freed as she had been acting to save lives, a decision that sparked Salvini’s ire but may have encouraged the Alex crew. Two other investigations, on charges of helping people smugglers and resisting the authorities, are still under way after Rackete forced her way past Italian customs vessels. A third rescue ship, German charity Sea-Eye’s vessel Alan Kurdi, carrying 65 shipwrecked migrants rescued off Libya on Saturday, arrived and held its position in international waters off Lampedusa. [..] A poll published in Italy’s Corriere della Sera newspaper on Saturday said 59% of Italians approved of Salvini’s closing ports to NGO vessels.

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“Rackete has gone into hiding following numerous threats..”

Sea-Watch Captain To Sue Italian Minister Salvini For Defamation (ToM)

The captain of detained migrant rescue ship Sea-Watch 3, Carola Rackete, will sue Matteo Salvini for defamation after a tirade of insults from Italy’s far-right interior minister, her lawyer said Friday. “We have prepared the legal complaint against minister Salvini,” Alessandro Gamberini told Italian radio, saying “it’s not easy to make a complete list of all the insults Salvini has made these last weeks.” Salvini, who is also deputy prime minister and an admirer of US President Donald Trump, is an avid user of social media, which he also uses to insult people he disagrees with. Salvini “stirs the troubled waters of hate. A defamation lawsuit is a way to send a signal,” the lawyer said, prompting a swift and angry response from the Lega minister.

“She breaks laws and attacks Italian military vessels, and then she sues me,” the anti-migrant Salvini tweeted. “I’m not afraid of the Mafia, let alone a rich and spoiled communist!” Italian police last week arrested Rackete, 31, after she defied orders to stay away and forced her way into port on Italy’s southern Lampedusa island to disembark 40 rescued migrants who had been stuck at sea on her vessel for two weeks. An Italian judge this week ordered her freed as she had been acting to save lives, a decision which also sparked Salvini’s ire. Two other investigations, on charges of helping people smugglers and resisting the authorities are still underway after she forced her way past Italian customs vessels.

During the two week standoff and after Salvini launched a series of furious tweets at the charity worker, including calling her a “pain in the arse”, “criminal”, “delinquent” and “poor woman who only tried to kill five Italian soldiers.” Rackete has gone into hiding following numerous threats, her charity Sea-Watch said Wednesday, a day after her release from Italian custody.

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I see a lot of outright stupid takes on this, as in Greeks turn their backs on populism. In reality, Tsipras is losing big only because he failed to deliver what he promised. Now an old right wing party named New Democracy with a leader who belongs to an actual political dynasty (!) will take over, and things will get even worse for the poor. I’m also afraid of violence in the streets.

Greeks Vote In Snap General Election (BBC)

Greeks are going to the polls to elect a new parliament, with the centre-right opposition mounting a strong challenge to the leftist government. The New Democracy party of Kyriakos Mitsotakis is hoping to end more than four years of rule by Prime Minister Alexis Tsipras’s Syriza party. Mr Tsipras called snap elections soon after suffering an electoral defeat in May’s European elections. The crisis triggered a succession of financial bailouts, with the Greek economy shrinking by 28% between 2008 and 2016, and increasing unemployment has thrown many Greeks into poverty. Greece exited the bailout programme in August of last year and growth has returned.

Mr Mitsotakis is promising lower taxes, greater privatisation of public services and plans to renegotiate a deal with Greece’s creditors that would allow more money to be reinvested in the country. Mr Tsipras, who came to power in 2015, has promised more investment and recently boosted pensions. His own investment policies would also have to be renegotiated with creditors as the country remains under eurozone supervision. Each of the country’s numerous parties needs to gain at least 3% of the vote to get into the parliament and as many as seven of them could win seats.

The winning party gets a 50-seat bonus and needs 151 seats in the 300-seat parliament to have a majority. At the European elections, New Democracy won 33.11% of the vote against 23.78% for Syriza. The highest percentage of 18-to-24 year olds (30.5%) at that election backed New Democracy.

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Europe c.1320

 

 

 

 

Jul 052019
 


Pablo Picasso Rest 1932

 

US Job Growth Seen Accelerating, Rate Cut Still Expected (R.)
German Industrial Orders Fell Far More Than Expected In May (R.)
Iran Demands Britain Release Oil Tanker Held In Gibraltar (AFP)
Europe Trade Channel With Iran Close To First Deal In Days (R.)
Has Trump Turned an Important Corner? (Luongo)
Mueller Report Gets Trump Tower Meeting Wrong; Promotes Browder Hoax (CN)
Vast Chinese Loans Pose Risks to Developing World (Spiegel)
The End Of Inheritance For The Middle Class (F.)
Electric Cars Will Not Solve Transport Problem (BBC)
Brazil Deforestation Increase Exceeds 88% In June (R.)
From Madagascar to Brazil, Researchers Pick Best Spots To Replant Forests (R.)
Tree Planting ‘Has Mind-Blowing Potential’ To Tackle Climate Crisis (G.)
Europe’s Treatment of Migrants Is Shameful (Spiegel)
82 Migrants Feared Dead After Boat Capsizes Off Tunisia (AlJ)

 

 

No, no fireworks, jets or tanks here.

 

The world of finance has developed a whole new logic.

US Job Growth Seen Accelerating, Rate Cut Still Expected (R.)

U.S. job growth likely rebounded in June, with wage gains expected to pick up, but that would probably not be enough to discourage the Federal Reserve from cutting interest rates this month amid growing evidence the economy is slowing. Lack of concrete progress in resolving an acrimonious trade war between the United States and China was also seen forcing the U.S. central bank’s hand, regardless of a strong employment report from the Labor Department on Friday. The Fed last month signaled it could ease monetary policy as early as July, citing low inflation as well as growing risks to the economy from an escalation in trade tensions between Washington and Beijing.

President Donald Trump and Chinese President Xi Jinping last week agreed to a trade truce and a return to talks. White House trade adviser Peter Navarro said on Tuesday talks were heading in the right direction, but it would take time to get the right deal made. The trade fight has undercut business confidence, leading to a downturn in equipment spending and manufacturing. “Given signs of slowing growth and little material progress on the trade war, a rebound in job growth would still leave the Fed on course to cut rates at the July meeting and we expect a 25 basis points cut,” said Sam Bullard, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.

Nonfarm payrolls probably increased by 160,000 jobs last month after rising by only 75,000 in May, according to a Reuters survey of economists. May marked the second time this year that job gains dropped below 100,000. Reports on Wednesday showed private employers hired far fewer-than-expected workers last month and a measure of services industries employment declined.

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When Germany has a problem, the entire EU does.

German Industrial Orders Fell Far More Than Expected In May (R.)

German industrial orders fell far more than expected in May, and the Economy Ministry warned on Friday that this sector of Europe’s largest economy was likely to remain weak in the coming months. Contracts for ‘Made in Germany’ goods were down by 2.2% on the month after rising slightly in March and April, data from the Economy Ministry showed. The reading undershot the Reuters consensus forecast for a 0.1% decline. “The great order book deflation continues,” ING economist Carsten Brzeski said. Devastating new orders data just undermined any hopes for an industrial rebound.”


Other recent data have painted a gloomy picture of the sector too, with engineering orders falling and activity in the manufacturing sector contracting. In a sign that the economic slowdown is beginning to bite, a survey by the Ifo institute published on Thursday showed German manufacturers expect to make more use of “Kurzarbeit” — a short-hours facility aimed at avoiding mass lay-offs. “What misery!” VP Bank economist Thomas Gitzel said after the orders data was published. “Given the significant decline in incoming orders, industrial production will remain extremely weak in the second half of the year and that increases the risk of recession for the German economy.”

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It didn’t even dock, it just slowed down to take on provisions. In waters that EU member Spain says are Spanish.

Iran Demands Britain Release Oil Tanker Held In Gibraltar (AFP)

Iran demanded Friday that Britain immediately release an oil tanker it has detained in Gibraltar, accusing it of acting at the bidding of the United States. A senior foreign ministry official “described the UK move as unacceptable” in a meeting with British ambassador Rob Macaire, who had been summoned to hear a formal protest, the ministry said in a statement. He “called for the immediate release of the oil tanker, given that it has been seized at the request of the US, based on the information currently available”, the statement added. Authorities in Gibraltar, a British overseas territory on Spain’s southern tip at the western entrance to the Mediterranean, said they suspected the tanker was carrying crude to Syria in violation of EU sanctions.


The detention of the 330-metre (1,000-feet) Grace 1 vessel comes at a sensitive time in Iran-EU ties as the bloc mulls how to respond to Tehran announcing it is poised to breach the uranium enrichment limit it agreed to in a troubled 2015 nuclear deal. The Grace 1 tanker was halted in the early hours of Thursday by police and customs agencies in Gibraltar, aided by a detachment of British Royal Marines. The ship was detained 2.5 miles (four kilometres) south of Gibraltar in what it considers British waters, although Spain, which lays claim to the territory, says they are Spanish. It was boarded when it slowed down in a designated area used by shipping agencies to ferry goods to vessels.

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So how do we link the seized Iran tanker to the new Instex trade channel set up to bypass the US?

Europe Trade Channel With Iran Close To First Deal In Days (R.)

French Finance Minister Bruno Le Maire said on Thursday he hoped a special trade channel set up with Iran would complete a first, limited transaction in the coming days. Set up by France, Britain and Germany, Instex is a barter trade mechanism that aims to avoid direct financial transfers by offsetting balances between importers and exporters on the European side. The mechanism is aimed at making it possible for trade between European Union members and Iran to continue in the face of stiff U.S sanctions since Washington quit a 2015 nuclear accord between Tehran and world powers last year.


Those sanctions have effectively suffocated Iran’s economy by clamping down on its oil sales. “We want Instex to enter into force in a few days, and I hope that we will be able to operate in a few days. I hope the first transaction will be completed in a few days,” Le Maire told journalists at a meeting in Poland. “The first transaction will be a limited one, but this is a starting point and we expect Instex to be an efficient tool,” Le Maire added. [..] France’s foreign ministry said on Wednesday that Instex would become operational based on Iran’s “full compliance with its JCPOA (Iran deal) commitments.” “We aren’t going to press the yes button if there are doubts about its compliance,” said one European diplomat.

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Bolton in Mongolia, Tucker Carlson in Air Force One.

Has Trump Turned an Important Corner? (Luongo)

Donald Trump’s surprise visit to North Korea last week was impressive. It was a bold first step in repairing a foreign policy in tatters after more than a year of assaults by his neoconservative boobsie-twins Secretary of State Mike Pompeo and National Security Advisor John Bolton. Trump took Kim at his word who said after talks broke down thanks to Bolton and Pompeo in Hanoi that no dialogue would be possible if Bolton was involved. So, Trump sent Bolton to Mongolia. Then he went to Korea and did the one thing he had to do to begin unraveling the mess he’d gotten himself into. Last week I asked where does Trump go after his confrontation with Iran? Trump answered that question in dramatic fashion. And he deserves a lot of credit for it.

But what does this mean in the wider context? It’s a good first step but we’ve seen this game from him before, making bold moves only to be reined in by his staff. I would say that the optics of sending Bolton to Mongolia are pretty clear. Bolton’s time in the White House is nearly over. This is also a strong signal to Iran that Trump trying to back down without actually saying that. The drone incident was intended to box Trump into a path to war with Iran after the tanker attack in the Gulf of Oman two weeks prior. That was likely not the Iranians but the Saudis and/or MEK, again trying to get Trump to fly off the handle, since he’s easily manipulated into emotional acts. But he was talked out of it at the last minute, presumably by Tucker Carlson, who was with him on Air Force One when Trump went to meet Kim.

[..] A lot has changed in the past four months since the end of the Mueller investigation. And the signs are all there that Trump is feeling a lot more secure both politically and financially that would allow him to not only make bold first moves but follow through on them. Speaker Nancy Pelosi backed down on border wall funding. She’s ruled out impeachment as a bad political tactic. And she’s under fire from the hard-core Progressives in the party. This makes them weak. So, from a re-election standpoint Trump looks very secure, especially after the “I’m more woke than you” fest that was the first debate among DNC candidates. We’re looking at a mirror of 2016 with the Republicans that Trump beat. A wide and shallow pool of less than capable candidates who will all eat each other alive while he rides to re-election.

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“On the issue of Browder, the Magnitsky story and the essence of the Trump Tower meeting, the Mueller Report is a deception intended to keep the myth of collusion in the air while dismissing that any collusion took place.”

Mueller Report Gets Trump Tower Meeting Wrong; Promotes Browder Hoax (CN)

The Mueller report thus focuses instead on “efforts to prevent disclosure of information about the June 9, 2016 Trump Tower meeting between Russians and senior campaign officials.” But the report on this topic is deceptive. Ironically, as it attacks Donald Trump and top campaign officials for lying, the report itself lies about the issue the meeting addressed. It wasn’t to provide dirt on Hillary Clinton, which the Russian lawyer did not have and never produced. That was a ploy by Robert Goldstone, a British music publicist whose job is to get what his clients want, in this case, a meeting. So, recklessly, he invented the idea of Clinton dirt as a bait-and-switch to get Trump’s people to come to it. He got the lawyer the meeting for her to lobby a potentially incoming administration against the Magnitsky Act, which is why she was in the United States in the first place.

The Magnitsky Act is a 2012 U.S. law that was promoted by William Browder, an American-born British citizen and hedge fund investor, who claimed his “lawyer” Sergei Magnitsky had been imprisoned and murdered because he uncovered a scheme by Russian officials to steal $230 million from the Russian Treasury. It sanctioned Russians he said were involved or benefitted from Magnitsky’s death. It has since been used by the U.S. to put sanctions on other Russians and nationals from other countries.

The lawyer lobbying against the act, Natalia Veselnitskaya, told Trump Jr., Kushner and Manafort that Browder’s story was fake, a smokescreen to block the Russians from going after him for multi-millions in tax evasion. She argued the Magnitsky Act was built on this fraud. Manafort’s notes, included in the Mueller Report, trace what she said.

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At the heart of Belt and Road is Chinese overcapacity.

Vast Chinese Loans Pose Risks to Developing World (Spiegel)

The future rail link cuts its way through the jungles of Laos for over 400 kilometers. Soon, trains will be rolling through — over bridges, through tunnels and across dams built just for the line, which runs from the Chinese border in the north to the Laotian capital of Vientiane on the Mekong River. After five years of construction, the line is set to go into service in 2021. And the Chinese head of one of the sections has no doubt that it will be finished on time. “Our office alone employs 4,000 workers,” he says. There is also no lack of money: The Chinese government in Beijing has earmarked around 6 billion dollars for the project and has recently become both Laos’s largest creditor and most significant provider of development aid.

China, after all, isn’t just directly financing 70 percent of the new train lain, it is also building dams, schools, military hospitals and has even launched a communications satellite into space for the country. In April, Beijing loaned Laos another 40 million dollars for road construction — a credit that was provided through the multilateral Asian Infrastructure Investment Bank based in Beijing, a financial institution that China established as an alternative to Western development banks. If Hong Kong is included, China isn’t just the largest creditor in Laos, but in the entire world. Beijing’s foreign loans dominate global markets almost to the same degree as its toys, smartphones and electric scooters do.

From Kenya to Montenegro, from Ecuador to Djibouti, roads, dams and power plants are being built with billions in loans from Beijing. And all of those countries will have to pay back those loans in the years to come. With interest. The flood of capital from China helped prevent the global economy from plunging into depression following the bankruptcy of Lehman Brothers and the ensuing financial crisis. But it isn’t without controversy. For some, the billions of dollars from China are a welcome contribution to helping many underdeveloped regions in Asia and Africa expand infrastructure. For others, the loans from Beijing have forced half the world into economic and political dependency on Beijing.

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What is left of Americans’ wealth dies by a thousand cuts. A predator society.

The End Of Inheritance For The Middle Class (F.)

Increasingly, the old family homestead is not being passed down to the family when the parents die. Older parents are taking advantage of reverse mortgages to pay off credit cards and to escape poverty and debt. This reduces equity in the home and often leads to foreclosure, leaving traditional heirs with nothing but memories. Not only are reverse mortgage companies feasting upon the assets of older Americans; so too are health insurers and prescription drug companies. Moreover, seniors on a fixed income were adversely affected by President Trump’s Tax Cuts and Jobs Act, which raised the threshold on medical expense tax deductions and placed a cap of $10,000 on the itemized deductibility of state and local taxes.

America seems to be in the midst of a paradigm shift. Wealth transfer is skipping the deceased’s traditional heirs and going directly into the pockets of mortgage companies, banks, international corporations and the government. An alarming percentage of older Americans have insufficient money to cover basic necessities. According to the Institute on Assets and Social Policy, one-third of senior households have no money left over each month or are in debt after meeting essential expenses. This makes them vulnerable to the lure of reverse mortgages.

Reverse mortgages allow homeowners age 62 and above to withdraw a portion of their home’s equity to help them pay expenses in retirement. The debt usually comes due when the borrower dies and is repaid through the sale of the home. However, borrowers can face foreclosure while living if they fall behind on property taxes or homeowner’s insurance.

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That a report must be written on this is what drives me to despair.

Electric Cars Will Not Solve Transport Problem (BBC)

Car use will still need to be curbed even when all vehicles are powered by clean electricity, a report has said. It warns that electrifying cars will not address traffic jams, urban sprawl and wasted space for parking. The Centre for Research into Energy Demand Solutions (CREDS) report calls on the government to devise a strategy allowing people to have a good standard of living without needing a car. The government said it was spending £2bn to promote walking and cycling. It also says it plans to spend £50bn on improving roads. However, critics accuse the government of not having a serious plan to deal with the social problems associated with mass car ownership.


CREDS is an academic consortium of more than 80 academics across the UK. “Car use is a massive blind spot on government policy,” Prof Jillian Anable, one of the authors of the report, said. She added: “For many years ministers have adopted the principle of trying to meet demand by increasing road space. “They need to reduce demand instead.” The authors say there will always be people who depend on cars, especially in the countryside or suburbs. But, they point out that many young people in cities are choosing not to buy cars. Instead they are using public transport, walking, cycling, taking minicabs and hiring cars when they are needed.

Read more …

Imagine all the species that vanish with the trees.

Brazil Deforestation Increase Exceeds 88% In June (R.)

Deforestation in Brazil’s portion of the Amazon rainforest soared more than 88% in June compared with the same month a year ago, the second consecutive month of rising forest destruction under new President Jair Bolsonaro, who has called for development of the region. According to data from Brazil’s space research agency, deforestation in the world’s largest tropical rainforest totaled 920 square km (355 square miles). The data showing an 88.4% deforestation increase is preliminary but indicates the official annual figure, based on more detailed imaging and measured for the 12 months to the end of July, is well on track to surpass last year’s figure.


In the first 11 months, deforestation already has reached 4,565 square km (1,762 square miles), a 15 percent increase over the same period in the previous year. That is an area larger than the U.S. state of Rhode Island. Environmentalists have warned that Bolsonaro’s strong remarks calling for the development of the Amazon and criticizing the country’s environmental enforcement agency Ibama for handing out too many fines would embolden loggers and ranchers seeking to profit from deforestation. “Bolsonaro has aggravated the situation. … He has made a strong rhetorical attack,” said Paulo Barreto, a researcher at Brazilian nongovernment organization Imazon.

Read more …

“..more than half of the tropical forests in the world are gone – most of that in the last 50 years..”

From Madagascar to Brazil, Researchers Pick Best Spots To Replant Forests (R.)

Researchers have identified swathes of lost tropical rainforests as the best places to replant trees, hoping to redress some of the damage done by deforestation and limit climate change. A four-year study used high-resolution satellite imagery to pinpoint more than 100 million denuded hectares (247 million acres) – from South Sudan to Brazil and India – that would deliver good results if reforested. “Globally, more than half of the tropical forests in the world are gone – most of that in the last 50 years,” said Robin Chazdon, a professor at the University of Connecticut and co-author of the study published on Wednesday in the journal Science Advances.


“These forests provide a huge amount of functioning and services for our planet and people that have gone unappreciated,” she told the Thomson Reuters Foundation. The tropics lost 12 million hectares of tree cover in 2018, the fourth-highest annual loss since records began in 2001, according to forest monitoring service Global Forest Watch. Of greatest concern, it said, was the disappearance of 3.6 million hectares of old-growth rainforest, an area the size of Belgium, much due to fires, land-clearing for farms and mining. Environmentalists say protecting existing forests and restoring damaged ones prevents flooding, stores carbon, limits climate change and protects biodiversity.

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Strong contender for stupidest headline.

Tree Planting ‘Has Mind-Blowing Potential’ To Tackle Climate Crisis (G.)

Planting billions of trees across the world is by far the biggest and cheapest way to tackle the climate crisis, according to scientists, who have made the first calculation of how many more trees could be planted without encroaching on crop land or urban areas. As trees grow, they absorb and store the carbon dioxide emissions that are driving global heating. New research estimates that a worldwide planting programme could remove two-thirds of all the emissions that have been pumped into the atmosphere by human activities, a figure the scientists describe as “mind-blowing”. The analysis found there are 1.7bn hectares of treeless land on which 1.2tn native tree saplings would naturally grow. That area is about 11% of all land and equivalent to the size of the US and China combined.


Tropical areas could have 100% tree cover, while others would be more sparsely covered, meaning that on average about half the area would be under tree canopy. The scientists specifically excluded all fields used to grow crops and urban areas from their analysis. But they did include grazing land, on which the researchers say a few trees can also benefit sheep and cattle. “This new quantitative evaluation shows [forest] restoration isn’t just one of our climate change solutions, it is overwhelmingly the top one,” said Prof Tom Crowther at the Swiss university ETH Zürich, who led the research. “What blows my mind is the scale. I thought restoration would be in the top 10, but it is overwhelmingly more powerful than all of the other climate change solutions proposed.”

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“This year alone, just under 600 migrants have drowned in the Mediterranean, a figure that is far greater than the number who have died along the U.S.-Mexican border.”

Europe’s Treatment of Migrants Is Shameful (Spiegel)

Today’s migration policies in the European Union are even more brutal than those pursued by Donald Trump. It may be true that the Europe doesn’t have border officials separating children from their parents, but the Europeans have entered into pacts with Libyan militias that operate horrific camps where torture and rape are commonplace, and they work together with the so-called Libyan coast guard, which is little more than a militia at sea. Sea rescue operations in the Mediterranean have practically been shut down, and Italian hardliner Matteo Salvini is no longer allowing private rescue ships to come ashore in the country.

The aim of all of this is clear: The crossing to Europe should be made more dangerous as a way of discouraging migrants from attempting it. And it seems to have worked: Fewer boats are coming. But more of those who try are dying. This year alone, just under 600 migrants have drowned in the Mediterranean, a figure that is far greater than the number who have died along the U.S.-Mexican border. The horrors of the EU’s migration policies aren’t playing out in front of the cameras — they are unfolding in North Africa and on the high seas. There was one exception last week: The captain of a ship with the German rescue organization Sea Watch, Carola Rackete, steered her ship to Lampedusa because people on board had already spent two weeks crammed together on deck and she felt the situation was no longer tenable. The captain was promptly arrested upon the vessel’s arrival in Italy. She was released by an Italian court on Tuesday.

Despite the suffering, the situation in the Mediterranean Sea is quite convenient for countries in northern Europe, while Italian Interior Minister Salvini is playing the role of brutal doorman and scapegoat. The numbers of refugees are stable, but the status quo also means that the issue of migration isn’t being solved. And meanwhile, the EU is selling its soul.

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Time to normalize Libya.

82 Migrants Feared Dead After Boat Capsizes Off Tunisia (AlJ)

A boat carrying at least 86 refugees and migrants has capsized off the coast of Tunisia with most feared drowned. Some of the four initial survivors told the Tunisian coastguard on Thursday the boat sank off the town of Zarzis, Tunisian Red Crescent official Mongi Slim told Reuters news agency. Tunisian fishermen came across the sinking boat and were able to pull four survivors out on Wednesday night, but could not find any of the other passengers, said Lorena Lando, head of the International Organization for Migration (IOM) in Tunisia.


Eighty-two people remain missing in the incident, which comes a day after a deadly air attack on a Libyan detention centre killed at least 44 migrants. Al Jazeera’s Sarah Khairat, reporting from a refugee camp in Zarzis where the survivors were brought, said the vessel was heading from the west of Libya to Europe when it capsized. The four survivors were all men – three from Mali and one from the Ivory Coast. The Ivory Coast national later died and two of the others are in hospital. Slim told dpa news agency the boat set sail from Libya on Monday. Earlier this week, another boat from Libya made it to the Tunisian port of Sfax with 65 people on board.

Read more …

 

Europe c.1320

 

 

 

 

Jul 042019
 
 July 4, 2019  Posted by at 7:14 pm Primers Tagged with: , , , , , , , , , , , , , , , ,  


Odilon Redon The Birth of Venus II c.1910

 

How do you define terror? Perhaps, because of the way the term has evolved in the English language, one wouldn’t call the west ‘terrorists’ per se, but ‘we’ are certainly spreading terror and terrorizing very large groups of people. Yeah, bring on the tanks and parade them around town. Add a marching band that plays some war tunes.

The ‘official’ storyline : at the request of the US, Gibraltar police and UK marines have seized an oil tanker in Gibraltar. The super-tanker, 1000 feet (330 meters) long, carrying 2 million barrels, had stopped there after sailing all around the Cape of Good Hope instead of taking the Suez canal on its way, ostensibly, from Iran to Syria.

And, according to the storyline as presented to and in the western press, because the EU still has sanctions on Iran, the British seized the ship. Another little detail I really appreciate is that Spain’s acting foreign minister, Josep Borrell, said Madrid was looking into the seizure and how it may affect Spanish sovereignty since Spain does not recognize the waters around Gibraltar as British.

That Borrell guy is the newly picked EU foreign policy czar, and according to some sources he’s supportive of Iran and critical of Israel. Them’s the webs we weave. He’s certainly in favor of Palestinian statehood. But we’re wandering…

Why did the tanker take that giant detour along the African coastline? Because potential problems were anticipated in the Suez canal. But also: why dock in Gibraltar? Because no problems were anticipated there. However, the US had been following the ship all along, and set this up.

A trap, a set-up, give it a name. I would think this is about Iran, not about sanctions on Syria; that’s just a convenient excuse. Moreover, as people have been pointing out, there have been countless arms deliveries to Syrian rebels in the past years (yes, that’s illegal) which were not seized.

 

The sanctions on Syria were always aimed at one goal: getting rid of Assad. That purpose failed either miserably or spectacularly, depending on your point of view. It did achieve one thing though, and if I were you I wouldn’t be too sure this was not the goal all along.

That is, out of a pre-war population of 22 million, the United Nations in 2016 identified 13.5 million Syrians requiring humanitarian assistance; over 6 million are internally displaced within Syria, and around 5 million are refugees outside of Syria. About half a million are estimated to have died, the same number as in Iraq.

And Assad is still there and probably stronger than ever. But it doesn’t even matter whether the US/UK/EU regime change efforts are successful or not, and I have no doubt they’ve always known this. Their aim is to create chaos as a war tactic, and kill as many people as they can. How do you define terror, terrorism? However you define it, ‘we’ are spreading it.

That grossly failed attempt to depose Assad has left Europe with a refugee problem it may never be able to control. And the only reason there is such a problem is that Europe, in particular Britain and France, along with the US, tried to bomb these people’s homelands out of existence. Because their leaders didn’t want to conform to “our standards”, i.e. have our oil companies seize and control their supplies.

 

But while you weren’t looking some things changed, irreversibly so. The US and Europe are no longer the undisputed and overwhelming global military power they once were. Russia has become a target they cannot even consider attacking anymore, because their armies, assembled in NATO, wouldn’t stand a chance.

China is not yet at the ‘might’ level of Russia, but US and NATO are in no position to attack a country of 1.4 billion people either. Their military prominence ended around the turn of the century/millennium, and they’re not going to get it back. Better make peace fast.

So what we’ve seen for a few decades now is proxy wars. In which Russia in particular has been reluctant to engage but decisive when it does. Moscow didn’t want to let Assad go, and so they made sure he stayed. Syria is Russia’s one single stronghold in the Middle East, and deemed indispensable.

Meanwhile, as over half of Syrians, some 11 million people, have been forced to flee their homes, with millions of them traumatized by war, ‘we’ elect to seize a tanker allegedly headed for a refinery in the country, so we can make sure all those people have no oil or less oil for a while longer.

So the refugees that do have the courage and will to return will find it that much harder to rebuild their homes and towns, and will tell those still abroad not to join them. At the same time Assad is doing fine, he may be the target of the sanctions but he doesn’t suffer from them, his people do.

 

Yes, let’s parade some tanks around town. And let’s praise the heroic UK marines who seized an utterly defenseless oil tanker manned by a bunch of dirt-poor Philippinos. Yay! There is probably some profound irony that explains why Trump and Bolton and Pompeo want a military parade at the very moment the US military must concede defeat in all theaters but the propaganda one.

Still there it is. The only people the US, the west, can still credibly threaten, are defenseless civilians, women, children. The leaders of nations are out of reach. Maduro, Assad, let alone Putin or Xi.

Happy 4th of July. Not sure how independent you yourself are, but I can see a few people who did achieve independence from western terror. Just not the poor, the ones that count. But don’t look at the tanks, look at the wind instead. The winds are shifting.

 

 

 

 

Jun 292019
 
 June 29, 2019  Posted by at 10:09 am Finance Tagged with: , , , , , , , , , , ,  


Salvador Dali Paranoiac Woman-Horse (Invisible Sleeping Woman, Lion, Horse) 1930

 

Wall Street Wraps Up Its Best June In Generations (R.)
Not A Rate-Cut Economy (WS)
You Are Nuts To Think A July Interest-Rate Cut Is A Slam Dunk (MW)
Deutsche Bank To Fire Up To 20,000: One In Six Full-Time Positions (ZH)
China and US Agree To Restart Trade Talks (R.)
Russia-India-China Will Be The Big G20 Hit (Escobar)
Trump Offers To Meet Kim Jong-Un At The DMZ (R.)
Boeing 737 Max Likely Grounded Until The End Of The Year (CNBC)
Boeing 787 Dreamliner Caught In Deepening 737 MAX Probe (RT)
EU Leaders Decide Against Weber For Commission Presidency (R.)
Say Anything! (Kunstler)

 

 

And nobody cares that none of it is real… Or that 3/4 of Americans live paycheck to paycheck.

Wall Street Wraps Up Its Best June In Generations (R.)

Wall Street advanced in heavy trading on Friday, with the S&P 500 and the Dow closing the book on their best June in generations, ahead of much-anticipated trade talks between U.S. President Donald Trump and Chinese counterpart Xi Jinping at the G20 summit now underway in Japan. All three major U.S. stock indexes gained ground at the close of the week, month, quarter and first half of the year, during which time the U.S. stock market has had a remarkable run. The S&P 500 had its best June since 1955. The Dow posted its biggest June percentage gain since 1938, the waning days of the Great Depression.


From the start of 2019, after investors fled equities amid fears of a global economic slowdown, which sent stock markets tumbling in December, the benchmark S&P 500 jumped 17.3%, its largest first-half increase since 1997. “The market came to the realization that the world is not going to end,” said John Ham, financial adviser at New England Investment and Retirement Group in North Andover, Massachusetts. “Also, (Federal Reserve chair) Powell did a 180 since (the Fed’s) last (interest) rate hike, which has put wind in our sails in the first half of the year.”

Read more …

Mostly it all just sounds stupid to me.

Not A Rate-Cut Economy (WS)

The inflation index that the Fed has anointed to be the yardstick for its inflation target – the PCE price index without the volatile food and energy components – rose 0.19% in May from April, according to the Bureau of Economic Analysis this morning. This increase in “core PCE” was near the top of the range since 2010. It followed the 0.25% jump in April, which had been the third largest increase since 2010. Fed Chair Jerome Powell, at the press conference following the no-rate-hike FOMC meeting last week, gave a clear and succinct summary of the US economy. It was mostly in good shape, he said, in particular where it mattered the most: “All of the underlying fundamentals for the consumer-spending part of the economy, which is 70% of the economy, are quite solid,” he said.

[..] The Fed’s “symmetric” target is a 2% annual increase in the core PCE index, meaning the increase can fluctuate some above or below the target without causing the Fed to act. Core PCE inflation was in the 2%-range for much of last year. But early this year, the increases softened. So in his opening remarks at the press conference, Powell said that “committee participants expressed concerns about the pace of inflation’s return to 2 percent.” [..] a trigger for a rate cut would be a “sustained” period significantly below the 2% target. Inflation data is volatile and jumps up and down. Earlier this year, when core PCE inflation fell significantly below 2%, Powell said that the factors behind this low inflation were “transitory.”


Janet Yellen, when she was still Fed Chair, also used “transitory” to describe the factors that in early and mid-2017 were causing an actual dip in core PCE – which hasn’t happened this year. And a few months later, she was proven right. After today’s data on the increase in the core PCE index, following the jump in April, the three-month increase – March, April, and May – has now hit 0.50%. Annualized, this amounts to 2.0% core PCE inflation over the past three months, in the bull’s eye of the Fed’s symmetrical target, with the last two months being substantially above the Fed’s target. But note the sharp decline in January, February, and March, and how it has now reversed:

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The sooner the Fed is gone the better.

You Are Nuts To Think A July Interest-Rate Cut Is A Slam Dunk (MW)

The markets have gotten so used to the Federal Reserve doing whatever it takes to keep the S&P 500 and bond prices rising that traders and investors are now expecting the Fed to go against its own judgment and aggressively cut interest rates next month. In putting a 100% probability on a cut in the federal funds target rate at the next Fed meeting on July 30 and 31, traders — and the economists who advise them — seem to have forgotten how language and math work. Not to mention economics. Comments by Fed Chairman Jerome Powell in the past 10 days have indicated that the Fed is open to cutting rates if necessary to keep the expansion going, but there’s no sign that policy makers have made up their minds about a July cut — or any cut at all, for that matter.


Powell said it would depend, “you know, on actual data and evolving risks.” The Fed might very well deliver the rate cut that the market is demanding, but only if something significant changes in the next four and a half weeks. The Fed won’t cut rates because it promised to do so at the last Fed meeting (it didn’t). And it won’t cut rates because the U.S. economy is teetering on the edge of recession (it isn’t), or because inflation is dropping (uh-uh), or because fragile financial markets could use a shot of confidence (nope). Before they cut rates, Fed officials would want to see some hard evidence that the outlook for the economy has materially worsened since they met on June 19. About the only thing that would qualify would be a disastrous meeting between Donald Trump and China’s Xi Jinping this weekend.

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No more global player.

Wall Street may have the best June in generations, but not all of Wall Street.

Deutsche Bank To Fire Up To 20,000: One In Six Full-Time Positions (ZH)

While Deutsche Bank finally delivered some good news for a change to its long-suffering investors, when it miraculously failed to fail the latest Fed stress test, on Friday the chronically sick bank reverted to its “cutting into muscle” baseline when the largest German lender with the €45 trillion notional derivatives was said to be preparing “to cut as much as half its global workforce in equities trading as part of a broad restructuring to boost profitability”, according to Bloomberg with the WSJ adding that the total number could be between 15,000 and 20,000 job cuts, or more than one in six full-time positions globally. The cuts being contemplated by senior executives reflect an acceleration of Deutsche Bank’s downsizing and another major pullback from its global ambitions.


If followed through, the reduction would represent 16% to 22% of Deutsche Bank’s workforce of 91,463 employees, as disclosed by the bank as of the end of March. According to the proposed plan the bank will eliminate hundreds of positions in equities trading and research, as well as derivatives trading, and is expected to start informing staff of cuts – including in the U.S. and Asia – as soon as next month. Rates trading is also affected. While the move begs the question just how effective half of the bank’s equity trading desk was, it will likely be welcomed by the market even if by slashing revenue producers the bank confirms that its trading margins have dropped to negative levels, a virtually unheard of event.

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They should always talk.

China and US Agree To Restart Trade Talks (R.)

The United States and China agreed on Saturday to restart trade talks and that Washington would hold off on imposing new tariffs on Chinese exports, signaling a pause in the trade hostilities between the world’s two largest economies. The truce offered relief from a nearly year-long dispute in which the countries have slapped tariffs on billions of dollars of each other’s imports, disrupting global supply lines, roiling markets and dragging on global economic growth. “We’re right back on track and we’ll see what happens,” U.S. President Donald Trump told reporters after an 80-minute meeting with Chinese President Xi Jinping on the sidelines of a summit of leaders of the Group of 20 (G20) major economies in Japan.


Trump said while he would not lift existing import tariffs, he would refrain from slapping new levies on an additional $300 billion worth of Chinese goods – which would have effectively extended tariffs to everything China exports to the America. “We’re holding back on tariffs and they’re going to buy farm products,” he said at a news conference. “If we make a deal, it will be a very historic event.” Trump said China would buy more farm products but did not provide specifics. In a lengthy statement on the talks, China’s foreign ministry said the United States would not add new tariffs on Chinese exports and that negotiators of both countries would discuss specific issues. Xi told Trump he hoped the United States could treat Chinese companies fairly, the statement added.

Read more …

India and Iran.

Russia-India-China Will Be The Big G20 Hit (Escobar)

It all started with the Vladimir Putin–Xi Jinping summit in Moscow on June 5. Far from a mere bilateral, this meeting upgraded the Eurasian integration process to another level. The Russian and Chinese presidents discussed everything from the progressive interconnection of the New Silk Roads with the Eurasia Economic Union, especially in and around Central Asia, to their concerted strategy for the Korean Peninsula. A particular theme stood out: They discussed how the connecting role of Persia in the Ancient Silk Road is about to be replicated by Iran in the New Silk Roads, or Belt and Road Initiative (BRI). And that is non-negotiable.

Especially after the Russia-China strategic partnership, less than a month before the Moscow summit, offered explicit support for Tehran signaling that regime change simply won’t be accepted, diplomatic sources say. Putin and Xi solidified the roadmap at the St Petersburg Economic Forum. And the Greater Eurasia interconnection continued to be woven immediately after at the Shanghai Cooperation Organization (SCO) summit in Bishkek, with two essential interlocutors: India, a fellow BRICS (Brazil, Russia, India, China, South Africa) and SCO member, and SCO observer Iran.


At the SCO summit we had Putin, Xi, Narendra Modi, Imran Khan and Iranian President Hassan Rouhani sitting at the same table. Hanging over the proceedings, like concentric Damocles swords, were the US-China trade war, sanctions on Russia, and the explosive situation in the Persian Gulf. Rouhani was forceful – and played his cards masterfully – as he described the mechanism and effects of the US economic blockade on Iran, which led Modi and leaders of the Central Asian “stans” to pay closer attention to Russia-China’s Eurasia roadmap. This occurred as Xi made clear that Chinese investments across Central Asia on myriad BRI projects will be significantly increased.

Read more …

“While there, if Chairman Kim of North Korea sees this, I would meet him at the Border/DMZ just to shake his hand and say Hello(?)!”

Trump Offers To Meet Kim Jong-Un At The DMZ (R.)

U.S. President Donald Trump said on Saturday he would like to see North Korean leader Kim Jong Un this weekend at the demilitarized zone (DMZ) between North and South Korea, and North Korea said a meeting would be “meaningful” if it happened. Trump, who is in Osaka, Japan, for a Group of 20 summit, is due to arrive in South Korea later on Saturday. He is scheduled to return to Washington on Sunday. If Trump and Kim were to meet, it would be for the third time in just over a year, and four months since their second summit, in Vietnam, broke down with no progress on U.S. efforts to press North Korea to give up its nuclear weapons.


Trump made the offer to meet Kim in a comment on Twitter about his trip to South Korea. “While there, if Chairman Kim of North Korea sees this, I would meet him at the Border/DMZ just to shake his hand and say Hello(?)!” he said. Trump later told reporters his offer to Kim was a spur-of-the-moment idea: “I just thought of it this morning.” “We’ll be there and I just put out a feeler because I don’t know where he is right now. He may not be in North Korea,” he said. “If he’s there, we’ll see each other for two minutes, that’s all we can, but that will be fine,” he added. Trump said he and Kim “get along very well”.

Read more …

They still pretend it’s about software.

Boeing 737 Max Likely Grounded Until The End Of The Year (CNBC)

Boeing’s 737 Max could stay on the ground until late this year after a new problem emerged with the plane’s in-flight control chip. This latest holdup in the plane’s troubled recertification process has to do with a chip failure that can cause uncommanded movement of a panel on the aircraft’s tail, pointing the plane’s nose downward, a Boeing official said. Subsequent emergency tests to fix the issue showed it took pilots longer than expected to solve the problem, according to The Wall Street Journal. This marks a new problem with the plane unrelated to the issues Boeing is already facing with the plane’s MCAS automated flight control system, an issue the company maintains can be remedied by a software fix.


Boeing hopes to submit all of its fixes to the Federal Aviation Administration this fall, the Boeing official said. “We’re expecting a September time frame for a full software package to fix both MCAS and this new issue,” the official said. “We believe additional items will be remedied by a software fix.” Once that software package is submitted, it will likely take at least another two months before the planes are flying again. The FAA will need time to recertify the planes. Boeing will need to reach agreement with airlines and pilots unions on how much extra training pilots will need. And the airlines will need some time to complete necessary maintenance checks.

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There we go…

Boeing 787 Dreamliner Caught In Deepening 737 MAX Probe (RT)

Federal prosecutors are expanding their Boeing probe, investigating charges the 787 Dreamliner’s manufacture was plagued with the same incompetence that dogged the doomed 737 MAX and resulted in hundreds of deaths. The US Department of Justice has requested records related to 787 Dreamliner production at Boeing’s South Carolina plant, where two sources who spoke to the Seattle Times said there have been allegations of “shoddy work.” A third source confirmed individual employees at the Charleston plant had received subpoenas earlier this month from the “same group” of prosecutors conducting the ongoing probe into the 737 MAX.

Boeing is in the hot seat over alleged poor quality workmanship and cutting corners at the South Carolina plant. Prosecutors are likely concerned with whether “broad cultural problems” pervade the entire company, including pressure to OK shoddy work in order to deliver planes on time, one source told the Seattle Times. The South Carolina plant manufactured 45 percent of Boeing’s 787s last year, but its supersize -10 model is built exclusively there. Prosecutors are on the hunt for “hallmarks of classic fraud,” the source said, such as lying or misrepresentation to customers and regulators. Whistleblowers in the Charleston factory who pointed to debris and even tools left in the engine, near wiring, and in other sensitive locations likely to cause operating issues told the New York Times they were punished by management, and managers reported they had been pushed to churn planes out faster and cover up delays.


[..] A critical fire-fighting system on the Dreamliner was discovered to be dysfunctional earlier this month, leading Boeing to issue a warning that the switch designed to extinguish engine fires had failed in “some cases.” While the FAA warned that “the potential exists for an airline fire to be uncontrollable,” they opted not to ground the 787s, instead ordering airlines to check that the switch was functional every 30 days.

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Tidings from the Empire.

EU Leaders Decide Against Weber For Commission Presidency (R.)

European Union leaders have agreed that conservative German candidate Manfred Weber will not become president of the bloc’s executive Commission, Germany’s Die Welt daily reported on Friday, citing sources familiar with the decision. The decision was reached during talks on the sidelines of the G20 summit in Osaka, Japan, Die Welt said. If confirmed, the compromise would be a blow to Chancellor Angela Merkel, who had backed Weber’s bid to replace Jean-Claude Juncker. French President Emmanuel Macron had opposed Weber’s candidacy, partly because of his lack of experience in high office.

EU leaders failed at a summit earlier this month to agree on who should hold the bloc’s top jobs after European Parliament elections last month, including on the Commission, which has broad powers on matters from trade to competition and climate policy. Weber is the leader of the European People’s Party (EPP), the conservative bloc that won most seats in the election and which includes Merkel’s Christian Democrats (CDU). A senior European diplomat told Reuters that socialist Dutchman Frans Timmermans, a deputy head at the Commission, was the front-runner to succeed Juncker. “Timmermans is the best placed,” the diplomat said.


The EU’s 28 national leaders will meet on June 30 to decide who fills the five prominent positions that would help the bloc navigate through internal and external challenges. The jobs include the presidency of the European Central Bank, which has helped the bloc’s economy return to growth after the financial crisis thanks to an extraordinary monetary stimulus programme.

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“..a wayward jellyfish blown hither and yon by Progressive winds..”

Say Anything! (Kunstler)

Apart from the colorful homage to all things Mexican, the signal event of the night was Elizabeth Warren’s stealth political suicide when the popular question of Medicare-for-all came up and NBC’s Lester Holt asked the candidates for a show of hands as to who would abolish private health insurance altogether. Up shot Liz’s hand. Only New York’s mayor, the feckless Bill DeBlasio joined her. If the contest was a game of “Survivor” both would have thereby voted themselves off the island — except Big Bill was never really on the island, just circling around it like a wayward jellyfish blown hither and yon by Progressive winds.


The only “B” Team figure onstage who appeared to be a serious candidate was Hawaiian congressperson Tulsi Gabbard, a major in the US Army Reserve with tours-of-duty in Iraq and Kuwait — especially impressive when smacking down cretinous Ohio congressman Tim Ryan, who mistakenly asserted that the Taliban were behind 9/11. Uh, no, Tulsi informed him, it was al Qaeda (sponsored by our “friend” Saudi Arabia). I predict Tulsi will make the cut to the “A” team, despite the news media’s desperate efforts to shove her off the playing field.

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Jun 282019
 
 June 28, 2019  Posted by at 9:41 am Finance Tagged with: , , , , , , , , , , ,  


Salvador Dali Invisible Sleeping Woman, Horse, Lion 1930

 

56% Of Americans Are Lying Awake At Night Worrying About Money (MW)
America’s Monopoly Crisis Hits the Military (AC)
US Car Industry Is Killing Itself (WS)
Baoshang Bank Collapse Threatens China’s Economy (ABC.au)
Deutsche Bank Passes Fed Stress Test In Boost For Its US Operations (R.)
Paul Singer Warns A 40% Market Crash Is Coming (ZH)
US Gets No Commitment From NATO Allies For Help On Iran Threat (AP)
Boeing Hopes To Complete 737 MAX Software Fix In September (AP)
Large US Companies Are Getting Bigger While The Small Wither Away (MW)
CIA Finances Another Group of Fraudsters: the Venezuelan ‘Opposition’ (SCF)
Varoufakis: My Proposals Don’t Need Negotiation With Greece’s Creditors (A.)
The First Genetically Modified Animals Approved For US Consumption (AP)

 

 

Brought to you by the world’s richest country.

56% Of Americans Are Lying Awake At Night Worrying About Money (MW)

How are you sleeping lately? Some Americans are feeling uneasy. Consumer confidence fell to a two-year low in June, the Conference Board announced this week. It fell to 121.5 this month from a 131.3 in May. That’s the lowest level since September 2017. “The escalation in trade and tariff tensions earlier this month appears to have shaken consumers’ confidence,” Lynn Franco, senior director at the Conference Board, said in a statement. Continued uncertainty could “diminish” people’s confidence in the economic expansion, she added. Many people are living with wildly fluctuating income, a recent report from the Board of Governors of the Federal Reserve System said.


“Volatile income and low savings can turn common experiences — such as waiting a few days for a bank deposit to be available — into a problem.” Despite unemployment hitting a 49-year low, plus low interest rates and inflation, people are feeling skittish. “A major trade war between the U.S. and China represents our greatest economic risk,” according to Lynn Reaser, chief economist of the Controller’s Council of Economic Advisors. All of these worries are taking their toll. 78% of adults are losing sleep over work, relationships, retirement and other worries, according to a study released Thursday by personal-finance site Bankrate.com. Over half (56%) of Americans are lying awake at night worrying about money.

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Can’t make anything anymore. And now there are plans to make Europe use US nukes…..

America’s Monopoly Crisis Hits the Military (AC)

Early this year, U.S. authorities filed criminal charges—including bank fraud, obstruction of justice, and theft of technology—against the largest maker of telecommunications equipment in the world, a Chinese giant named Huawei. Chinese dominance in telecom equipment has created a crisis among Western espionage agencies, who, fearful of Chinese spying, are attempting to prevent the spread of Huawei equipment worldwide, especially in the critical 5G next-generation mobile networking space. In response to the campaign to block the purchase of Huawei equipment, the company has engaged in a public relations offensive.

The company’s CEO, Ren Zhengfei, portrayed Western fears as an advertisement for its products, which are, he said, “so good that the U.S. government is scared.” There’s little question the Chinese government is interested in using equipment to spy. What is surprising is Zhengfei is right about the products. Huawei, a relatively new company in the telecom equipment space, has amassed top market share because its equipment—espionage vulnerabilities aside—is the best value on the market. In historical terms, this is a shocking turnaround. Americans invented the telephone business and until recently dominated production and research. But in the last 20 years, every single American producer of key telecommunication equipment sectors is gone.

Today, only two European makers—Ericsson and Nokia—are left to compete with Huawei and another Chinese competitor, ZTE. This story of lost American leadership and production is not unique. In fact, the destruction of America’s once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely. Huawei is just a particularly prominent example.

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Well, they can still make cars…

US Car Industry Is Killing Itself (WS)

The average age of passenger cars and trucks on the road in the US ticked up again in 2019, to another record of 11.8 years, IHS Markit reported today. When I entered the car business in 1985, the average age had just ticked up to 7.8 years, and the industry was fretting over it and thought the trend would have to reverse, and customers would soon come out of hiding and massively replace those old clunkers with new vehicles, and everyone would sell more and make more. But those industry hopes for a sustained reversal of the trend of the rising average age have been bitterly disappointed:

This rising average age is largely driven by vehicles lasting longer – an unintended consequence of relentless improvements in overall quality, forced upon automakers by finicky customers in an ultra-competitive market where automakers struggle to stay alive. To make it in the US, they have to constantly improve their products, and stragglers that can’t compete are left unceremoniously by the wayside. US consumers are brutal. This unintended consequence of rising overall quality contributes to the dreadful industry problem: The US, despite constant population growth, is a horribly mature auto market. In 1999, so 20 years ago, new vehicle sales reached a record of 16.9 million units.


This record was broken in 2000, with 17.3 million units. Then sales tapered off. By 2007, they’d dropped to 16.1 million units. Then the Financial Crisis hit, GM and Chrysler went bankrupt, Ford almost did, and peak-to-trough, sales plunged 40% to 10.4 million units by 2009. The recovery has been steep, and in 2015, finally the old record of the year 2000 was broken, but barely with 17.48 million units, and in 2016, the industry eked out another record of 17.55 million units. And that was it. Sales have fizzled since then. So far in 2019, the data indicates that sales are likely to fall below 17 million units, according to my own estimates, bringing the industry right back where it had been 20 years ago in 1999:

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Nothing a little QE won’t fix?!

Baoshang Bank Collapse Threatens China’s Economy (ABC.au)

Up until a few weeks ago the Baoshang Bank’s prospects seemed bright enough. According to Baoshing’s most recent regulatory filing, the smallish lender based in Inner-Mongolia, made a $600 million profit in 2017. It had assets of around $90 billion, non-performing loans were modest — under 2 per cent — and its capital buffers would fit comfortably with the global demands of a Tier1 bank. Then it collapsed. That set off a series of events rarely, if ever, seen in Chinese banking. Regulators seized Baoshang, the first action of its type since 1998. That may have shaken the foundations of Chinese banking, but of far greater significance was the collapse caused by China’s first recorded interbank default.

It is yet to be a “Lehman moment” — where the credit market freezes, banks stop lending to each other and the economy teeters above the abyss —but it has, as Societe Generale’s Wei Yao noted, “triggered severe liquidity tensions in the interbank market”. “The Baoshang incidence has challenged one fundamental belief of China’s financial system; interbank defaults are not possible thanks to 100 per cent implicit guarantees,” Ms Yao said. “Now that credit risks and counter-party risks have finally descended on this very core market in China’s financial system, all the key players in the system have to figure out how to price risks in the new paradigm, and quickly.”

Ms Yao said the understandable consequence was “a big and unpleasant wave of risk repricing”, with major banks shying away from doing business with smaller lenders. And that’s a worry, as small-to-medium sized banks combined have balance sheets as big as the big banks combined, but are far more dependent on interbank funding. The central bank (PBoC) immediately pumped around 600 billion yuan ($125 billion) into the system and halted a run on the banks by guaranteeing 100 per cent of all retail deposits.

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Not the Onion.

Deutsche Bank Passes Fed Stress Test In Boost For Its US Operations (R.)

Deutsche Bank’s shares rose as much as 4.8% on Friday after Germany’s biggest bank passed an annual health check by the U.S. Federal Reserve, in a boost to its Wall Street operations. But the Federal Reserve placed conditions on the U.S. operations of Credit Suisse, knocking its shares 1% lower after identifying weaknesses in its capital planning. The tests assess whether it is safe for banks to implement their capital plans, including using extra capital for stock buybacks, dividends and other purposes beyond providing a cushion against losses. They are designed to avoid a repeat of the taxpayer bailouts of the 2007-2009 financial crisis.


Deutsche Bank, whose U.S. business has been plagued by litigation, underperformance and regulatory investigations, topped the German bluechip index .GDAX in Frankfurt after its U.S. shares were up as much as 6% in after-the-bell trading on Thursday following the Fed’s news. The German bank maintained a large presence on Wall Street after the 2007-2009 financial crisis, while Credit Suisse made big cuts. But Deutsche’s efforts to compete with U.S. rivals have been hampered by litigation and regulatory investigations. Deutsche Bank Chief Executive Christian Sewing, who is battling to turn the bank around, said the Fed’s decision was “excellent news” in a memo to staff on its website. “Achieving success here was one of the key goals we set a year ago. It is a huge step forward for our business in the U.S. and globally. A strong operating platform in the Americas is essential to our clients,” he said.

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Lowballing.

Paul Singer Warns A 40% Market Crash Is Coming (ZH)

Speaking at the Aspen Ideas Festival, billionaire investor and Elliott Management founder, Paul Singer, warned that the global economy is heading toward a “significant market downturn” cautioning that “the global financial system is very much toward the risky end of the spectrum.” While Paul Singer’s traditionally downcast outlook is hardly surprising, as it permeates every investor letter published by the successful investor who has been particularly clear in the past decade that the Fed’s monetary experiment will end terribly, he sees two particular reasons why the economy is approaching a tipping point: “global debt is at an all-time high.

Derivatives are at an all-time high and it took all of this monetary easing to get to where we are today and I don’t think central bankers, or policymakers or academics are in any better shape to predict the next downturn and I think we are the high end of the risk spectrum.” He then ominously added that “I’m expecting the possibility of a significant market downturn.” How bad would the crash be? According to the Elliott Management CEO, there will be a market “correction” of 30% to 40% when the downturn hits, although unlike Goldman – which gave a timeline of 12 months in which the next major market will materialize, Singer said he couldn’t predict the timing.

In the panel discussion, Singer also said the market meltdown late last year after interest rates spiked in the 4th quarter was the first hint of a pending slump, as it indicated that the Federal Reserve and other central banks were now victims of their policies, something he has been warning about for years. “December supported the notion that they’re trapped,” he said. “What they should have done, and what they should do now, is try to restore the soundness of money. They should not be cutting rates right now. They should be calling on the congresses and parliaments around the developed world to take steps to deal with the economic slowdown in growth.”

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Europe likes Iran just the way it is.

US Gets No Commitment From NATO Allies For Help On Iran Threat (AP)

NATO allies gave the U.S. no firm commitments that they will participate in a global effort to secure international waterways against threats from Iran, acting Defense Secretary Mark Esper said Thursday, wrapping up his first alliance meeting. Esper said the U.S. will come back next month and provide reluctant allies more details on exactly how the Iranian threat has escalated in recent months, and how nations can work together to deter further aggression. “At the end of the day what our ask is here, near term, is to publicly condemn Iran’s bad behavior,” Esper said as he prepared to leave Brussels. “And in the meantime, in order to avoid a military escalation, help us maintain the freedom of navigation in the Strait of Hormuz, in the Persian Gulf and wherever.”


Esper, who didn’t have high expectations for firm commitments coming in, got little of either, though he said that some allies privately expressed interest in hearing more. Esper’s visit to NATO, just days after he took over at the Pentagon, came amid sharply increased tensions between the U.S. and the Islamic Republic. The Trump administration has blamed Iran for recent attacks on oil tankers in the Gulf of Oman, as well as bombings in Iraq. Iranian forces also shot down an American drone that it said had flown into its airspace, which the U.S. disputes. Earlier this week, as he headed to NATO, Esper said his goal was to persuade allies that the confrontation with Iran is a global challenge requiring an international response, and that it is “not Iran versus the United States.”

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“There are many families here who will not want to participate in mediation until they know what Boeing knew, when they knew it, what they did about it, and what they’re going to do about it..”

Boeing Hopes To Complete 737 MAX Software Fix In September (AP)

Boeing says it expects to finish work on updated flight-control software for the 737 Max in September, a sign that the troubled jet likely won’t be flying until late this year. The latest delay in fixing the Max came a day after the disclosure that government test pilots found a new technology flaw in the plane during a test on a flight simulator. The plane has been grounded since mid-March after two crashes that killed 346 people. Preliminary accident reports pointed to software that erroneously pointed the planes’ noses down and overpowered pilots’ efforts to regain control. A Boeing official said Thursday that the company expects to submit the software update to the Federal Aviation Administration for approval “in the September timeframe.”

Once Boeing submits its changes, the FAA is expected to take several weeks to analyze them, and airlines would need additional time to take their grounded Max jets out of storage and prepare them to fly again. Airlines were already lowering expectations for a quick return of the plane, which has been grounded since mid-March. Southwest Airlines, the biggest operator of Max jets, announced Thursday that it has taken the plane out of its schedule for another month, through Oct. 1. Earlier this week, United Airlines pulled the plane from its schedule through early September.

While Boeing engineers continue working on the plane’s software, company lawyers pushed Thursday to settle lawsuits brought by the families of dozens of passengers killed in the October crash of a Lion Air Max off the coast of Indonesia and the March crash of an Ethiopian Airlines Max near Addis Ababa. Boeing and the families of Lion Air Flight 610 victims agreed to mediation that could lead to early settlements. However, the families of some Ethiopian Airlines Flight 302 passengers are resisting mediation. “There are many families here who will not want to participate in mediation until they know what Boeing knew, when they knew it, what they did about it, and what they’re going to do about it to prevent this kind of disaster from occurring again,” said Robert Clifford, a Chicago lawyer who filed lawsuits on behalf of nearly two dozen victims of the Ethiopian crash.

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Concentrate.

Large US Companies Are Getting Bigger While The Small Wither Away (MW)

FTSE Russell will rebalance its suite of indexes at the close of trade Friday, and the changes will reflect several broad trends in equity markets over the past year, including the resilience of large-capitalization companies, the dismal performance of smaller U.S. firms, and the emergence of new, highly valued technology companies that promise to, or already have, revolutionized their respective industries. “We reconstitute the Russell indexes annually to accurately reflect equity markets,” said Catherine Yoshimoto, director of product management at FTSE Russell, in an interview. “All the companies are ranked by total market capitalization and the break point between the [large cap] Russell 1000 and [small cap] Russell 2000 are reset.”


The dividing line between the large cap index and the small fell this year, from a capitalization of $3.7 billion to $3.6 billion, as a result of the poor performance of small cap companies, which shrunk in average market capitalization from $2.5 trillion to $2.4 trillion, as the small cap index fell 6.3% over the past 12 months, versus a 7.5% rise in price for larger companies. Steven DeSanctis, equity strategist at Jefferies told MarketWatch that today’s environment — with rising labor costs, material costs and new trade barriers — is especially difficult for small companies to navigate. He estimates that earnings for Russell 2000 companies fell 14.5% in the first quarter of this year on 3.4% of sales growth, while the second quarter will likely show small-cap earnings falling 11.5%, on 3.6% of revenue growth. “Small cap companies are getting squeezed at the margin,” he said. “A lot of companies have revenue growth but falling profits.”

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The story gets uglier by the day.

CIA Finances Another Group of Fraudsters: the Venezuelan ‘Opposition’ (SCF)

Once again, the Central Intelligence Agency has been caught financing a group of grifters and fraudsters at the expense of the American taxpayers. In the latest case, just another in the agency’s 72-year history, the Trump administration-appointed ad hoc board of CITGO, the US subsidiary of the state-owned Venezuelan oil company, PDVSA, stands accused of steering $70 million of escrowed funds, earmarked for PDVSA’s fiscal year 2020 bond, to the pockets of CIA-supported officials of the Venezuelan opposition “Popular Will” party headed by the so-called “interim president” of Venezuela, Juan Guaidó.

In addition to Guaidó, who is accused by the legitimate Venezuelan government of money laundering, treason, and corruption, other Popular Will leaders under investigation by both the Venezuelan Attorney General and the US Justice Department include Carlos Vecchio, Guaidó’s envoy in Washington; Rossana Barrera and Kevin Rojas, Guaidó’s emissaries in Cucuta, a Colombian-Venezuelan border town; Sergio Vargara, Barrera’s brother-in-law and a Member of the Venezuelan Congress; Guaidó’s “ambassador” to Colombia, Humberto Calderon Berti, opposition businessman Miguel Sabal; and Guaidó’s chief of staff, Roberto Marrero. Over two dozen other Popular Will leaders are also under investigation for fraud involving money earmarked by the Trump administration, particularly Iran-Contra scandal felon and current Trump special envoy for regime change in Venezuela, Elliot Abrams.

Barrera and Rojas are accused of spending money given to the Popular Will by the US Agency for International Development (USAID), a longtime CIA financial pass-through, for “humanitarian relief” for alleged massive numbers of Venezuelan refugees in Colombia. The Popular Will grifters reportedly used the aid money, including that which was raised by Virgin Group’s billionaire founder and obvious CIA dupe Richard Branson, for expensive hotels, fancy restaurants, nightclubs, prostitutes, and clothing.

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Varoufakis is way ahead of his time. Elections July 7, but he’ll be lucky to get any seats at all.

Varoufakis: My Proposals Don’t Need Negotiation With Greece’s Creditors (A.)

– Reduction of the public debt with an embedded growth clause: the higher the national income, the more creditors will receive, and the reverse. Varoufakis said that this will force lenders to become partners in the recovery of Greece.

– Ending austerity by a drastic reduction of surpluses. Varoufakis said that Syriza and ND have pledged to return to the lenders the equivalent of at least 7,000 euros per capita each year from the so-called primary state surpluses. MeRA25 will unilaterally reduce these surpluses by 60-100 pct, depending on the recovery rate, he added.

– Abolition of obligatory prepayment of 100% of taxes, and capping the VAT rate at 18% for cash purchases, 15% for using a credit card. Reduction of corporate tax: e.g. from current 29 pct, to 26 pct for large businesses, 20 pct for medium-sized ones and 15 pct for small businesses; capping profits on SMEs at 50 pct tax (currently at 75 pct).

– Public extra-bank reliant payment system allowing free digital transactions among citizens, businesses and the state, benefitting all: e.g. by mutual debt cancellation, tax deductions, funding of anti-poverty programs, reducting the hold of private banks and the European Central Bank on citizens and state alike.

– Establishment of a public management company of private debt, so that non-performing loans (NPLs) are transferred from banks to this organisation, in exchange for government guarantees not counted towards public debt. In addition, a ban on loan sales, foreclosure auctions, especially of primary residences and small businesses.

– Inclusion under the Foundation of Social Insurance (IKA) of all freelancers who work more than 8 hours a week for the same employer. Incentives towards start-up entrepreneurs with a 5-year exemption from taxes and insurance contributions.

– Conversion of the Hellenic Republic Asset Development Fund to a Development Bank, abolition of all privatizations, and use of public property as collateral to create investment flows in the public sector; the new bank’s shares will be owned by insurance funds, boosting their capitalization.

Yanis Varoufakis insisted that these measures would be implemented without negotiation with Greece’s lenders and financial institutions, and underlined that the creditors might react by bringing back GRexit scenarios. In this case, which he ruled out, “it will cost them 1 trillion euros.” “If we continue to apply Syriza’s fourth memorandum there will be no young people left in our country,” concluded Varoufakis, who also reiterated that his party will not give a vote of confidence to either Syriza or New Democracy, but will nevertheless support any bill it considers fair.

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Mass suicide.

The First Genetically Modified Animals Approved For US Consumption (AP)

Inside an Indiana aquafarming complex, thousands of salmon eggs genetically modified to grow faster than normal are hatching into tiny fish. After growing to roughly 10 pounds (4.5 kilograms) in indoor tanks, they could be served in restaurants by late next year. The salmon produced by AquaBounty are the first genetically modified animals approved for human consumption in the U.S. They represent one way companies are pushing to transform the plants and animals we eat, even as consumer advocacy groups call for greater caution. AquaBounty hasn’t sold any fish in the U.S. yet, but it says its salmon may first turn up in places like restaurants or university cafeterias, which would decide whether to tell diners that the fish are genetically modified.

“It’s their customer, not ours,” said Sylvia Wulf, AquaBounty’s CEO. To produce its fish, Aquabounty injected Atlantic salmon with DNA from other fish species that make them grow to full size in about 18 months, which could be about twice as fast as regular salmon. The company says that’s more efficient since less feed is required. The eggs were shipped to the U.S. from the company’s Canadian location last month after clearing final regulatory hurdles.

As AquaBounty worked through years of government approvals, several grocers including Kroger and Whole Foods responded to a campaign by consumer groups with a vow to not sell the fish. Already, most corn and soy in the U.S. is genetically modified to be more resistant to pests and herbicides. But as genetically modified salmon make their way to dinner plates, the pace of change to the food supply could accelerate. This month, President Donald Trump signed an executive order directing federal agencies to simplify regulations for genetically engineered plants and animals. The move comes as companies are turning to a newer gene-editing technology that makes it easier to tinker with plant and animal DNA.

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Jun 262019
 
 June 26, 2019  Posted by at 9:46 am Finance Tagged with: , , , , , , , , , , , ,  


Pablo Picasso The muse 1935

 

Iran Says It Will Never Pursue A Nuclear Weapon (ZH)
Iran Foreign Minister Accuses Bolton Of Plotting For War (R.)
NATO Calls On Russia To Destroy New Missile, Warns Of Response (R.)
Mueller To Testify Before Two House Committees July 17 (AFP)
A. Gary Shilling Says The US Is Already In A Recession
Housing Market Slump Could Drive Global Growth To A Decade Low (MW)
Merrill Lynch Caught Criminally Manipulating Precious Metals Market (ZH)
Apple Doubles Down On Buybacks (Axios)
Italy’s Gold Now Belongs To The ECB (ZH)
Investors With $34 Trillion Demand Urgent Climate Change Action (R.)

 

 

“How many people have you killed with a nuclear weapon? How many generations have you wiped out with these weapons?”

Iran Says It Will Never Pursue A Nuclear Weapon (ZH)

Following Iran’s statement that diplomacy with the United States is “closed forever” after Washington sanctioned the Supreme Leader and other key officials, including on the foreign minister himself – making it practically hard to actually “do” diplomacy given sanctions also have the impact of restricting travel for the nation’s top diplomat – FM Javad Zarif slammed America’s track record with nukes. “You were really worried about 150 people? How many people have you killed with a nuclear weapon? How many generations have you wiped out with these weapons?” Zarif said Tuesday in reference to Trump’s calculus that he refrained from ordering last Thursday night’s readied military strike against Iran when informed 150 people would die.


“It is us who, because of our religious views, will never pursue a nuclear weapon,” Zarif added. Indeed it’s been long understood that since Iran’s Islamic revolution the Ayatollahs have been consistently against nuclear weapons on moral grounds, citing Koranic principles. The US remains the only country in the world to have ever deployed nuclear weapons in a wartime situation, dropping two on Japan at the end of WWII. Though scholars generally agree that the overwhelming destruction on Hiroshima and Nagasaki made counting impossible, conservative estimates tend to be at over 200,000 dead and wounded total wrought by the twin atom bombs dropped over those cities. And of course, the overwhelming majority of the Japanese dead and wounded were civilians.

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How dare he.

Iran Foreign Minister Accuses Bolton Of Plotting For War (R.)

Iran’s Foreign Minister Mohammad Javad Zarif accused U.S. National Security Adviser John Bolton of plotting for war against Iran in a tweet on Tuesday. “Wanna know why those with proven record of detesting diplomacy are suddenly interested in talks? Just read @AmbJohnBolton’s 2017 recipe for destroying the #JCPOA,” Zarif wrote, adding a link to a 2017 article written by Bolton in the National Review. The Joint Comprehensive Plan of Action, or JCPOA, is the landmark 2015 nuclear deal Iran signed with world powers. “Iran never left the negotiation table. #B_Team dragged the U.S. out, while plotting for war,” Zarif added. Zarif has in the past said that a “B-team” including Bolton, an ardent Iran hawk, and Israeli Prime Minister Benjamin Netanyahu, could goad Trump into a conflict with Tehran.

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An excuse for more rockets on Russia’s border.

NATO Calls On Russia To Destroy New Missile, Warns Of Response (R.)

NATO urged Russia on Tuesday to destroy a new missile before an August deadline and save a treaty that keeps land-based nuclear warheads out of Europe or face a more determined alliance response in the region. NATO defense ministers will discuss on Wednesday their next steps if Moscow keeps the missile system that the United States says would allow short-notice nuclear attacks on Europe and break the 1987 Intermediate-range Nuclear Forces Treaty (INF). “We call on Russia to take the responsible path, but we have seen no indication that Russia intends to do so,” Secretary-General Jens Stoltenberg told a news conference. “We will need to respond,” Stoltenberg said.


He declined to go into more details. But diplomats said defense ministers will consider more flights over Europe by U.S. warplanes capable of carrying nuclear warheads, more military training and the repositioning U.S. sea-based missiles. The United States and its NATO allies want Russia to destroy its 9M729/SSC-8 nuclear-capable cruise missile system, which Moscow has so far refused to do. It denies any violations of the INF treaty, accusing Washington of seeking an arms race. Without a deal, the United States has said it will withdraw from the INF treaty on Aug. 2, removing constraints on its own ability to develop nuclear-capable, medium-range missiles.

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Brought to you by the Trump 2020 re-election committee.

Mueller To Testify Before Two House Committees July 17 (AFP)

Former US special counsel Robert Mueller is to testify in public about his report into Russian electoral interference, paving the way for a historic television moment in which Democrats will attempt to make the case for President Donald Trump’s impeachment before the American people. The scrupulously tight-lipped Mueller will appear at back-to-back hearings on July 17 of the House Judiciary and Intelligence Committees, which announced Tuesday that the prosecutor had agreed to abide by subpoenas for his testimony. “Russia attacked our democracy to help Trump win. Trump welcomed and used that help,” House Intelligence Committee chairman Adam Schiff said on Twitter.


“As Mueller said, that should concern every American. And now, every American will get to hear directly from Mueller.” Trump’s apparent response to the announcement came swiftly in a two-word tweet in which he complained, without referring to Mueller, of “Presidential Harassment!” The Mueller report released in April outlined numerous contacts between Trump’s 2016 election campaign and government-linked Russians, as well as evidence that the president tried on several occasions to stymie the investigation. The Democrats have been split on whether to launch impeachment proceedings against the Republican president but — fearing that much of the country is unaware of the Mueller report’s contents — have been asking major figures in the probe to testify in public on its findings.

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He says it will be mild.

A. Gary Shilling Says The US Is Already In A Recession

Gary Shilling, an economist and financial analyst who is credited with predicting several recessions over the past 40 years, thinks the U.S. is in a relatively mild slump. “I think we’re probably already in a recession but I think it will probably be a run-of-the-mill affair, which means real GDP would decline 1.5% to 2%, not the 3.5% to 4% you had in the very serious recessions,” Shilling, president of economic and financial research firm A. Shilling & Co., said in a recent interview broadcast this week by Real Vision. In such a tempered slide, he says, “Stocks probably wouldn’t fall” but if they did, they likely would tumble about 22% — similar to other recent recessions. That, he says, would take the Standard and Poor’s 500 index about 200 points below it’s Christmas Eve nadir of 2,351.


His view is at odds with the vast majority of economists who expect the economy to grow a solid 2% to 2.5% this year after expanding at about a 3% clip last year and in the first quarter. Shilling points to: • Declining industrial production, a result of a weak global economy and the Trump administration’s trade war with China. • Feeble job growth of 75,000 in May, along with downward revisions to prior months. • The Federal Reserve Bank of New York’s recession probability chart, which shows about a 30% chance of a downturn the next 12 months, up from about 10% early this year. That data is based on an inversion of the yield curve, which has shown rates on 3-month Treasury bonds topping 10-year notes recently – a sign that investors don’t have much faith in the longer-term outlook. Inversions do herald recessions but often two years in advance.

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China: $6.8 trillion in household debt, a 70% rise in personal debt from just three years ago.

Housing Market Slump Could Drive Global Growth To A Decade Low (MW)

The global housing market is showing cracks. Those fissures could spread throughout the world-wide economy, potentially sending world-wide gross domestic product, or GDP, to its lowest annual pace of in 10 years, according to research from Oxford Economics, led by economists Adam Slater, and John Payne in a research report dated June 24. “A combined slump in house prices and housing investment in the major economies could cut world growth to a 10-year low of 2.2% by 2020 – and to below 2% if it also triggered a tightening in global credit conditions.” the Oxford Economics researchers wrote.

A decade since the 2008-09 U.S. housing bubble imploded, sparking a global financial crisis, worries about the health of the global housing market persist. An Oxford Economics’ proprietary gauge of housing conditions in the globe shows that home prices have declined by 10% and investments in houses have shrunk by 8%. Housing prices across the globe have come in to focus as a protracted tariff squabble between the U.S. and China ripples throughout the global economy, compelling a number of central bankers to entertain the idea of lowering benchmark borrowing costs in an effort to stimulate, or just maintain, economic expansion.

The Federal Reserve last Wednesday signaled a willingness to lower federal-funds rates, currently at 2.25%-2.50%, if financial conditions worsen. In China, a decade long housing boom has sent home values to the lofty levels, with buying in the region underpinned by some $6.8 trillion in household debt, according to the Bank for International Settlements, a 70% rise in personal debt from just three years ago, with much of that tied to residential mortgages. Oxford Economics says data show that residential investment in China is slowing as are starts for new construction also ebb

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Nopbody goes to jail, nobody even pays a fine. A broken system indeed.

Merrill Lynch Caught Criminally Manipulating Precious Metals Market (ZH)

On Tuesday after the close, the CFTC announced that Merrill Lynch Commodities (MLCI), a global commodities trading business, agreed to pay $25 million to resolve the government’s investigation into a multi-year scheme by MLCI precious metals traders to mislead the market for precious metals futures contracts traded on the COMEX (Commodity Exchange Inc.). The announcement was made by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. In other words, if the Merrill Lynch Commodities group was an individual, he would have gotten ye olde perp walk.

As MLCI itself admitted, beginning in 2008 and continuing through 2014, precious metals traders employed by MLCI schemed to deceive other market participants by injecting materially false and misleading information into the precious metals futures market. They did so in the now traditional market manipulation way – by placing fraudulent orders for precious metals futures contracts that, at the time the traders placed the orders, they intended to cancel before execution. In doing so, the traders intended to “spoof” or manipulate the market by creating the false impression of increased supply or demand and, in turn, to fraudulently induce other market participants to buy and to sell futures contracts at quantities, prices and times that they otherwise likely would not have done so.

Over the relevant period, the traders placed thousands of fraudulent orders. Of course, since we are talking about a bank, and since banks are in charge of not only the DOJ, and virtually every other branch of government, not to mention the Fed, nobody will go to jail and MLCI entered into a non-prosecution agreement and agreed to pay a combined – and measly – $25 million in criminal fines, restitution and forfeiture of trading profits.

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Stock manipulation

Apple Doubles Down On Buybacks (Axios)

Apple again led S&P 500 companies in buybacks, spending a new record $23.8 billion in Q1, more than doubling its spend from the previous quarter, data from S&P Global shows. Apple has long been a buyback behemoth. The company holds 8 of the 10 all-time records for quarterly buybacks, and has spent more than $75 billion on buybacks over just the past year. It has spent $234.7 billion over the most recent 5-year period, and $284.3 billion over the last 10-year period. Apple accounted for 23% of share buybacks made by the top 20 S&P 500 companies. The big picture: While Apple has increased its buyback spending, other S&P 500 companies have slowed from 2018’s record pace.


Companies bought back just $205.8 billion worth of their own shares, a 7.7% decline from Q4 2018, S&P reported. That ended the streak of 4 consecutive quarters of record buybacks. Yes, but: Buybacks rose 8.9% from Q1 2018, which set a record at the time. Outside analysis of the broader stock market, beyond just the S&P, shows announced buyback spending was higher in Q1 2019 than Q4 2018. Ratings agency Moody’s warned last month that companies are spending more on share buybacks and dividends than they were paying in taxes before the 2017 tax cut. The tax savings “can be wiped out entirely by even a modest change in share buybacks,” Christina Padgett, senior vice president at Moody’s, told Axios at the time.

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Italy has quite a lot of it.

Italy’s Gold Now Belongs To The ECB (ZH)

As the squabbling over Italy’s populist government’s plans to blow out its budget deficit to finance an agenda of tax cuts and social spending (including a ‘citizen’s income’ that’s essentially UBI-lite) crowded the headlines, the issue of who owns the 2,451 metric tons of gold reserves held by the Bank of Italy has been quietly ignored – at least, outside of Italy. But that might be about to change. On Tuesday, the ECB asked the League, the dominant party in Italy’s ruling coalition, to remove a reference to the Bank of Italy holding gold as an “exclusive title of deposit” according to Bloomberg. Translation? If Italy is not allowed to have title to Italian gold, then Italy’s gold now belongs to the ECB.

Today’s escalation over Italy’s gold “title” comes two months after the WSJ reported that Italy’s ruling populists pushed ahead with efforts to seize control of the central bank and its gold reserves. Complaining that hundreds of thousands of small individual investors lost billions of dollars after several Italian banks failed in recent years, the current Italian government depicted the central bank as a symbol of a technocratic elite aloof from the needs of ordinary Italians. “We need a change of course at the Bank of Italy if we think about what happened in the last years,” said Deputy Prime Minister Luigi Di Maio, leader of the 5 Star Movement. Shortly thereafter, 5 Star lawmakers asked parliament to pass two draft laws.

One law would instruct the central bank’s owners, most of them private banks , to sell their shares to the Italian Treasury at prices from the 1930s.The other law would declare the Italian people to be the owners of the Bank of Italy’s reserve of 2451.8 metric tons of gold, worth around $102 billion at current prices. “The gold belongs to the Italians, not to the bankers,” said Giorgia Meloni, leader of the Brothers of Italy, a far-right opposition party that supports both bills. “We are ready to battle everywhere in Italy and to bring Italians to the streets if necessary.” So far there has been no fighting but if indeed Draghi just told Italy that its gold now belongs to the Frankfurt-based central bank we expect that to change..

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So how much are they willing to pay?

Investors With $34 Trillion Demand Urgent Climate Change Action (R.)

Investors managing more than $34 trillion in assets, nearly half the world’s invested capital, are demanding urgent action from governments on climate change, piling pressure on leaders of the world’s 20 biggest economies meeting this week. In an open letter to the “governments of the world” seen by Reuters, groups representing 477 investors stressed “the urgency of decisive action” on climate change to achieve the Paris Agreement target. Almost 200 nations agreed in Paris in 2015 to limit the global average temperature rise to well below 2 degrees Celsius above pre-industrial times. Current policies put the world on track for at least a 3C rise by the end of the century.


The letter comes ahead of a June 28-29 G20 summit in Japan and as United Nations Secretary-General Antonio Guterres urges countries to back more ambitious climate goals. “There is an ambition gap… This ambition gap is of great concern to investors and needs to be addressed, with urgency,” a statement from the investors accompanying the letter said. Governments were urged to strengthen their Paris Agreement targets by 2020; phase out thermal coal power and fossil fuel subsidies by set deadlines; set a robust global carbon price by 2020 and improve climate-related financial reporting. “It is vital for our long-term planning and asset allocation decisions that governments work closely with investors to incorporate Paris-aligned climate scenarios into their policy frameworks and energy transition pathways,” the statement said.

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Arundhati Roy:

 

 

 

 

 

Jun 252019
 
 June 25, 2019  Posted by at 9:36 am Finance Tagged with: , , , , , , , , , ,  


Pablo Picasso Minotauromachie 1935

 

Interest Rates Don’t Need To Rise Much To Cause Recessions Now (Colombo)
The Federal Reserve Is About To Create A Lot More Zombies (MW)
The Solution to Trump’s Iran Mayhem (FFF)
Iran Says New US Sanctions “Permanent Closure” Of Diplomacy (AFP)
Oil Prices Drop Amid Demand Worries, But US-Iran Tensions Support (R.)
Provoking Iran Could Start a War, Crash the Entire World Economy (Pieraccini)
House Party (Jim Kunstler)
Three Years After The Brexit Referendum, What Has Changed? (Coppola)
Firms Fear For Deliveries In Shipping Pollution Shakeup (R.)
‘Climate Apartheid’: UN Expert Says Human Rights May Not Survive (G.)

 

 

The shadow Fed Funds rate is already rising sharply. Wiggle room approaches zero.

Interest Rates Don’t Need To Rise Much To Cause Recessions Now (Colombo)

As a result of debt growing faster than our underlying economy, America’s debt as a percent of GDP soared from just over 150% in the early-1980s to approximately 350% in recent years. This higher debt burden is the reason why our economy simply cannot handle interest rates as high as they were before 2008. Particularly worrisome is the fact that U.S. federal debt is at a record of over 100% of the GDP (vs. 62% before the Great Recession), which will make it a much greater challenge to keep the economy afloat in the coming recession:

As the Fed Funds rate chart below shows, the interest rate threshold necessary to trigger recessions (recessions are designated by the gray bars) keeps falling as our debt burden increases:

Though many optimists are quick to point out that the benchmark Fed Funds rate was only increased from 0% to 2.5% during the current tightening cycle, the reality is that the current tightening cycle is even more aggressive than the past several cycles when the Fed Funds rate is adjusted for quantitative easing (this is known as the shadow Fed Funds rate). According to this methodology, interest rates have increased by the equivalent of 5.41% in the current cycle versus just 3.62% before the 2001 recession and 4.26% before the Great Recession of 2007 to 2009:

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It’s like hearing my own echo.

The Federal Reserve Is About To Create A Lot More Zombies (MW)

Long-term interest rates just fell off a cliff. And if you think they can’t keep falling, think again. Albert Edwards, a strategist at SG Securities, pointed out in a recent note that none of the experts surveyed by the Wall Street Journal at the start of the year predicted 10-year Treasury yields would fall below 2.5%. Current level: 2%. I guess we can toss those forecasting models out the window. He adds that mainstream economists have been saying for years that long-term rates would never end up at zero percent. Yet rates in Europe are now negative. People are paying half a percent a year for the privilege of lending money to the government of Switzerland. Even in the U.S., 10-year rates adjusted for inflation are only 0.29%. A generation ago, they were typically 2% or better.

Western economists used to say that zero percent rates were a weird and unique thing you only saw in Japan — like people eating raw puffer fish and hoping not to die. It would never catch on over here, they said. But they already have. Today European rates are even lower than those in Japan. When U.S. rates first collapsed in 2011-2012, we were assured it was a freak one-off event and was never going to happen again. When it happened again in 2016, we were told it was, well, a “two-off” event that was certainly never going to happen a third time. Now it’s happening a third time, and I guess we’re waiting for the official line on why, once again, this is just a temporary derangement and nothing to worry about.

But the Bank for International Settlements says there is something to worry about, and it’s the reason that economic growth, inflation and interest rates can’t get off the ground: zombies. No, I’m not making this up. The BIS says there are way too many zombies around, and they’re killing the economy, and it’s all the fault of low interest rates. We’re talking “corporate zombies,” of course. The BIS found that, ever since the 1980s, falling interest rates have made it easier and easier for bad companies with lousy management and terrible products and dismal prospects to stay in business long after they should have gone the way of all flesh. These “zombie” companies can stay alive — or whatever the correct term is for zombies — if they can just keep borrowing.

And when money gets cheaper, that’s great for zombies. Lower interest rates are correlated with rising numbers of zombie companies, the BIS found. And there are a lot of zombies around. The BIS reckons no fewer than 12% of the non-financial companies on major developed stock markets could be “zombie” companies, at least by a loose definition. This is an epidemic. In the early 1990s, the figure was about 2%.

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“Restore America’s founding principles of a limited-government republic and its founding foreign policy of non-interventionism. That’s the way to restore peace, prosperity, morality, harmony, normality, fiscal responsibility, and freedom to our land.”

The Solution to Trump’s Iran Mayhem (FFF)

Should the Nobel Peace Prize be awarded to a man who resolves his own crises and then chooses to kill innocent people with sanctions rather than bombs as a way to achieve a political end? Even a blind man can see that Trump’s actions toward Iran have been entirely belligerent, all with the aim of squeezing the Iranian citizenry and bullying their government officials into complying with his dictates or else face a “defensive” U.S. bombing attack. It’s helpful to remind ourselves of what happened here. Iran entered into a deal with the U.S. government under the presidency of Barrack Obama. Pursuant to the deal, Iran would agree not to acquire nuclear weapons and the U.S. government would lift the brutal U.S. sanctions that were impoverishing and even killing the Iranian citizenry.

Complying with the agreement, Iran gave up its nuclear weapons programs, fully expecting the U.S. government to comply with its end of the bargain by lifting its sanctions. Then Donald Trump entered the presidency and proceeded to immediately tear up the deal, knowing full well that Iran had compiled with it with the expectation that the U.S. government would fulfill its end of the bargain. Not only did Trump not lift the sanctions, he doubled down and began enforcing them even more brutally than Obama had. In other words, Iran was double-crossed by the U.S. government operating under Trump. (I wonder if North Korean officials are noticing this.)

[..] The problems began when the U.S. government abandoned its founding policies of a limited-government republic and non-interventionism and instead became a national-security state and embraced a foreign policy of empire and interventionism. This is what gave the country a huge, permanent military establishment, both domestically and in foreign countries. It also gave the nation assassinations, torture, coups, regime-change operations, alliances with dictatorial regimes, installation of dictatorial regimes, sanctions, embargoes, illegal invasions and occupations, undeclared wars, wars of aggression, terrorism, a war on terrorism, out-of-control spending and debt, and, of course, the destruction of American liberty and privacy.

[..] There is but one solution to all this mayhem: Restore America’s founding principles of a limited-government republic and its founding foreign policy of non-interventionism. That’s the way to restore peace, prosperity, morality, harmony, normality, fiscal responsibility, and freedom to our land.

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Sanctions as a military tool. May not be that wise.

Iran Says New US Sanctions “Permanent Closure” Of Diplomacy (AFP)

Iran said Tuesday US sanctions on its leaders represent the “permanent closure” of diplomacy with Washington, after President Donald Trump tightened the screws on a nation he has threatened with “obliteration”. “Imposing fruitless sanctions against Iran’s supreme leader and the commander of Iran’s diplomacy is the permanent closure of the path to diplomacy with Trump’s desperate government,” ministry spokesman Abbas Mousavi said in a tweet. Washington imposed new sanctions against supreme leader Ayatollah Ali Khamenei Monday ahead of blacklisting Foreign Minister Mohammad Javad Zarif later this week, its latest salvo in a tense standoff that has raised fears of a regional conflict.


“Trump’s government is destroying all established international mechanisms for keeping global peace and security,” he added. Tehran and Washington broke off diplomatic relations in 1980 over the hostage crisis at the US embassy in Tehran following Iran’s Islamic revolution. US President Donald Trump also imposed new sanctions Monday against top Iranian military chiefs, pressuring the country it has threatened with “obliteration” if a war breaks out.

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Oil prices fall in this climate. That’s remarkable.

Oil Prices Drop Amid Demand Worries, But US-Iran Tensions Support (R.)

Oil fell on Tuesday amid concerns over the outlook for crude demand, but prices were supported after Washington announced new sanctions on Iran amid mounting tensions in the Middle East. Benchmark Brent crude futures were down 34 cents, or 0.5%, at $64.52 a barrel by 0639 GMT. They dropped 0.5% on Monday. U.S. crude futures were down 24 cents, or 0.4%, at $57.66 a barrel. The U.S. benchmark rose 0.8% in the previous session. Brent climbed 5% last week and U.S. crude surged 10% after Iran shot down a U.S. drone on Thursday in the Gulf, adding to tensions stoked by attacks on oil tankers in the area in May and June. Washington has blamed the tanker attacks on Iran, which denies having any role.


U.S. President Donald Trump targeted Iranian Supreme Leader Ayatollah Ali Khamenei and other top Iranian officials with sanctions on Monday, taking an unprecedented step to increase pressure on Iran after Tehran’s downing of the drone. “This would appear to effectively rule out any talks or negotiations to end the crisis,” said Tom O’Sullivan, founder of energy and security consultancy Mathyos Advisory.

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Derivatives and oil again.

Provoking Iran Could Start a War, Crash the Entire World Economy (Pieraccini)

As if the political and military situation at this time were not tense and complex enough, the two most important power groups in the United States, the Fed and the military-industrial complex, both face problems that threaten to diminish Washington’s status as a world superpower. The Fed could find itself defending the role of the US dollar as the world reserve currency during any conflict in the Persian Gulf that would see the cost of oil rise to $300 a barrel, threatening trillions of dollars in derivativesand toppling the global economy. The military-industrial complex would in turn be involved in a war that it would struggle to contain and even win, destroying the United States’ image of invincibility and inflicting a mortal blow on its ability to project power to the four corners of the world.

Just look at how surprised US officials were about Iran’s capabilities to shot down an advanced US Drone: “Iran’s ability to target and destroy the high-altitude American drone, which was developed to evade the very surface-to-air missiles used to bring it down, surprised some Defense Department officials, who interpreted it as a show of how difficult Tehran can make things for the United States as it deploys more troops and steps up surveillance in the region.” The US dollar-based economy has a huge debt problem caused by post-2008 economic policies. All central banks have lowered interest rates to zero or even negative, thus continuing to feed otherwise dying economies.

The central bank of central banks, the Bank for International Settlements, an entity hardly known to most people, has stated in writing that “the outstanding notional amount of derivative contracts is 542 trillion dollars.” The total combined GDP of all the countries of the world is around 75 trillion dollars. With the dimensions of the problem thus understood, it is important to look at how Deutsche Bank (DB), one of the largest financial institutions in the world, is dealing with this. The German bank alone has assets worth about 40 trillion dollars in derivatives, or more than half of annual global GDP. Their solution, not at all innovative or effective, has been to create yet another bad bank into which to pour at least 50 billion dollars of long-term assets, which are clearly toxic.

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Don’t know what to call it? No worries, mate, Jim can help.

“..as if Mr. Biden might have been mistaken for a waiter in the senators’ dining room, with its old fashioned-ways and renowned bean soup.”

House Party (Jim Kunstler)

As the first of 12 presidential debates blows in at mid-week like an evil patch of bad summer weather, twenty candidates vie for the position of Ole Massa on the Democratic Party plantation, and the air is gravid with bad vibes. One highly-favored entry, Mayor Pete (Buttigieg) of charming South Bend, Indiana, stepped into (and tripped over) a big fresh patty of mule poop over the weekend at a “town hall” meeting that was called to address the June 16 shooting of one Eric Logan, 54, by a police officer dispatched to check out “a suspicious individual going through cars” at 2:30 a.m. The officer said the suspect came at him with a knife. The officer failed to switch on his body-cam, or so the police department said. Conclusions were jumped to. Then, in the wee hours just before Mayor Pete’s June 24 town hall, another black man was killed and 10 other people wounded in the shoot-up of a watering hole called Kelly’s Pub.

God knows what that was about — no police were involved in the shoot-up — but Mayor Pete caught the blame for it, of course, and the Sunday town hall meeting turned into a shriek-in by outraged “community” members. He was hardly allowed to admit his failures, issue apologies, and promise to do better. After the ordeal, Mayor Pete struggled to hold in his tears talking to the media. No doubt he will be pressured to keep ‘splainin’ these matters until either his campaign folds up its tent or he is anointed at the national convention in Milwaukee.

Leader-of-the-Pack (in the polls, anyway) Joe Biden stepped into it perhaps even deeper than Mayor Pete last week when he bragged about how well he was able to work with the old southern segregationist fossils, Herman Talmadge (GA) and James O. Eastland (MS), who were still around in the senate when “Uncle Joe” first came on the scene decades ago. “We didn’t agree on much,” the former Veep said, “but we got things done.” What’s more, the candidate averred, going perhaps a bridge too far, Senator Eastland “never called me ‘boy,’ he always called me ‘son,’” as if Mr. Biden might have been mistaken for a waiter in the senators’ dining room, with its old fashioned-ways and renowned bean soup.

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The divide has widened enormously. So much so that Brexit has become very dangerous.

Three Years After The Brexit Referendum, What Has Changed? (Coppola)

No-one should be fooled by the British media’s attempts to present this contest as a presidential battle like that between Donald Trump and Hillary Clinton in 2016. It is nothing of the kind. The people of the U.K. will have no say in who leads them. That will be decided by about 160,000 Tory party members, mainly old, white, rich and male. Representative of the population of the U.K., they are not. Both leadership candidates have offered tax policies designed to please these people. Boris Johnson’s proposal to cut taxes for the very rich and pay for it by raising payroll taxes was described by The Economist as “a shameless bribe to the elderly and prosperous Tory party members who choose the leader.”

Jeremy Hunt’s approach is more subtle: lowering corporation tax to match Ireland’s rate is still a bung to the rich, but it can be dressed up in supply-side economic language to give the impression of benefiting wider U.K. society. Americans might recall that President Trump’s corporate tax cuts were advertised as benefiting middle-income people through trickle-down effects, though they have primarily benefited the very rich. The Economist – hardly a bastion of lefty economics – was decidedly lukewarm about Hunt’s proposal, pointing out that corporation tax had already been cut considerably and it might be better to tax cashflows rather than profits.

But this contest is really about Brexit. Tory party members are overwhelmingly in favour of leaving the EU, and very frustrated by what they see as May’s delay. They want Brexit now, even if that means leaving with no deal. And they will vote for the candidate they think is most likely to deliver that regardless of the consequences. A recent poll showed that most of them would accept the breakup of the U.K. and/or the death of their own party as the price of Brexit.

Boris Johnson set up this scene of him and his girlfriend after reports of police being called to a big fight the two had. And then someone added a few words. Priceless.

 

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“This is expected to push up the price of diesel fuel for trucks by as much as 100 percent.”

Excellent. Needless transport is our biggest scourge.

Firms Fear For Deliveries In Shipping Pollution Shakeup (R.)

U.S. furniture company RC Willey Home Furnishings is so concerned that new global clean air rules will cause transport disruption that it brought forward the shipment of arm chairs and sofas from China by two months. The tougher regulations, set by the United Nations shipping agency, the International Maritime Organization (IMO), come into force on Jan 1. Costs will rise for ships towards the end of this year and there will be a knock on effect for trucks and other transporters that move goods around the world. For shipping companies it is the biggest shakeup in decades and adds to the pressures of an economic slowdown and the threat of an escalating trade war between the United States and China.

While consumers are not expected to pay more for goods, higher transport bills and disruption to company deliveries could further dent economic growth. Ship owners must cut sulphur emissions to 0.5% from 3.5%. They can do this by using low-sulphur fuel, installing exhaust gas cleaning systems or opting for other, more expensive, clean fuels such as liquefied natural gas or traveling more slowly. Jeff Child, president of Berkshire Hathaway’s RC Willey Home Furnishings, moved the delivery of about 450 containers from September and October to July and August. He wants to avoid any disruption in the peak fourth quarter as ships prepare for the changes, including refitting equipment. “We just don’t want to get caught in a situation where it affects our inventory,” he told Reuters.

Analysts say the container industry, which transports consumer goods such as sofas, designer clothes and bananas, will be one of the worst hit with extra costs of about $10 billion. The world’s two biggest container shipping lines – Denmark’s Maersk and Swiss headquartered MSC – say they face annual extra costs of over $2 billion each. Twenty-five logistics company executives told Reuters they would pass along any IMO-related costs, such as ship upgrades or more expensive fuel, to customers. “The sulphur cap will further put pressure on ocean freight rates and we… will have to pass those costs on to remain competitive,” Peder Winther, global head of ocean freight with Swiss transportation company Panalpina Group said.

[..] “Higher fuel prices would result in higher transport costs,” said Peter Nagle, an economist with the World Bank’s Development Prospects Group. “This would have the potential to lead to slower economic growth and trade.” Trucking companies will also suffer. The IMO rules do not apply to them but they will face new competition from ships for lower sulfur fuel. This is expected to push up the price of diesel fuel for trucks by as much as 100 percent.

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But nobody listens to the UN anymore.

‘Climate Apartheid’: UN Expert Says Human Rights May Not Survive (G.)

The world is increasingly at risk of “climate apartheid”, where the rich pay to escape heat and hunger caused by the escalating climate crisis while the rest of the world suffers, a report from a UN human rights expert has said. Philip Alston, UN special rapporteur on extreme poverty and human rights, said the impacts of global heating are likely to undermine not only basic rights to life, water, food, and housing for hundreds of millions of people, but also democracy and the rule of law. Alston is critical of the “patently inadequate” steps taken by the UN itself, countries, NGOs and businesses, saying they are “entirely disproportionate to the urgency and magnitude of the threat”. His report to the UN human rights council (HRC) concludes: “Human rights might not survive the coming upheaval.”

The report also condemns Donald Trump for “actively silencing” climate science, and criticises the Brazilian president, Jair Bolsonaro, for promising to open up the Amazon rainforest to mining. But Alston said there were also some positive developments, including legal cases against states and fossil fuel companies, the activism of Greta Thunberg and the worldwide school strikes, and Extinction Rebellion. In May, Alston’s report on poverty in the UK compared Conservative party welfare policies to the creation of 19th-century workhouses. Ministers said his report gave a completely inaccurate picture, but Alston accused them of “total denial of a set of uncontested facts”.

Alston’s report on climate change and poverty will be formally presented to the HRC in Geneva on Friday. It said the greatest impact of the climate crisis would be on those living in poverty, with many losing access to adequate food and water. “Climate change threatens to undo the last 50 years of progress in development, global health, and poverty reduction,” Alston said. Developing countries will bear an estimated 75% of the costs of the climate crisis, the report said, despite the poorest half of the world’s population causing just 10% of carbon dioxide emissions.

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