Jul 052018
 
 July 5, 2018  Posted by at 8:15 am Finance Tagged with: , , , , , , , , , , ,  


Vincent van Gogh Ravine 1889

 

China Warns US ‘Opening Fire’ On World With Tariff Threats (R.)
China Denies It Will Be First To Impose Tariffs On $34bn Of US Goods (G.)
Europe Turns Down Chinese Offer For Grand Alliance Against The US (ZH)
EU Reportedly Considering International Talks To Cut Car Tariffs (CNBC)
Germany’s Massive Trade Surplus ‘Is Becoming Toxic,’ Ifo Director Says (CNBC)
Tories ‘Toast’ If They Don’t Deliver On Brexit, Theresa May Warned (Sky)
There Is Only Option On The Table: Soft Brexit (G.)
UK Home Office Separating Scores Of Children From Parents (Ind.)
Bank of Japan Takes Away Punch Bowl, Balance Sheet Declines (WS)
India Is Emerging As Ground Zero Of The World’s Biggest NPL Crisis (ZH)
Kim Dotcom Loses New Zealand Extradition Appeal (AFP)
Babies (CJ)

 

 

Negotiate!

China Warns US ‘Opening Fire’ On World With Tariff Threats (R.)

The United States is “opening fire” on the world with its threatened tariffs, the Chinese government warned on Thursday, saying Beijing will respond the instant U.S. measures go into effect as the two locked horns in a bitter trade war. The Trump administration’s tariffs on $34 billion of Chinese imports are due to go into effect at 12.01 am eastern time on Friday (0401 GMT Friday), which is just after midday on Friday Beijing time. U.S. President Donald Trump has threatened to escalate the trade conflict with tariffs on as much as a total of $450 billion in Chinese goods if Beijing retaliates, with the row roiling financial markets including stocks, currencies and global trade of commodities from soy beans to coal.

China has said it will not “fire the first shot”, but its customs agency said on Thursday in a short statement that Chinese tariffs on U.S. goods will take effect immediately after Washington’s tariffs on Chinese goods kick in. Speaking at a weekly news conference, Chinese Commerce Ministry spokesman Gao Feng warned the proposed U.S. tariffs would hit international supply chains, including foreign companies in the world’s second-largest economy. “If the U.S. implements tariffs, they will actually be adding tariffs on companies from all countries, including Chinese and U.S. companies,” Gao said. “U.S. measures are essentially attacking global supply and value chains. To put it simply, the U.S. is opening fire on the entire world, including itself,” he said.

Read more …

Well, obviously.

China Denies It Will Be First To Impose Tariffs On $34bn Of US Goods (G.)

China has denied it will fire the opening salvo in an escalating trade dispute with the US, insisting that it would not bring in 25% tariffs on $34bn (£26bn) of American goods before a move from Washington. Both sides have threatened to impose similarly sized tariffs on 6 July, but because of the 12-hour time difference, it was thought the Chinese tariffs on US imports ranging from soybean to stainless steel pipes could take effect earlier. However, China’s finance ministry issued a statement on Wednesday saying that it would not be the first to levy tariffs.

“The Chinese government’s position has been stated many times. We absolutely will not fire the first shot, and will not implement tariff measures ahead of the United States doing so.” The US will implement a 25% tariff on $34bn of Chinese imports – 818 product lines ranging from cars to vaporisers and “smart home” devices – on Friday. There had been hopes the US and China might step away from the measures, but neither side has backed down. Economists have warned that the tariffs will damage economic growth and cost jobs, and could escalate into a full-blown trade war between the world’s two largest economies.

Read more …

Nonstarter.

Europe Turns Down Chinese Offer For Grand Alliance Against The US (ZH)

Publicizing its growing exasperation in dealing with president Donald Trump who refuses to halt the tit-for-tat retaliation in the growing trade war with China – which is set to officially begin on Friday when the US slaps $34 billion in Chinese exports with 25% tariffs – but has a habit of doubling down the threatened US reaction to every Chinese trade counteroffer (after all the US imports far more Chinese goods than vice versa)…China has proposed a novel idea: to form an alliance with the EU – the world’s largest trading block – against the US, while promising to open up more of China’s economy to European corporations.

The idea was reportedly floated in meetings in Brussels, Berlin and Beijing, between senior Chinese officials, including Vice Premier Liu He and the Chinese government’s top diplomat, State Councillor Wang Yi, according to Reuters. Willing to use either a carrot or a stick to achieve its goals, in these meetings China has been putting pressure on the European Union to issue a strong joint statement against President Donald Trump’s trade policies at a summit later this month. However, perhaps because China’s veneer of the leader of the free trade world is so laughably shallow – China was and remains a pure mercantilist power, whose grand total of protectionist policies put both the US and Europe to shame – the European Union has outright rejected any idea of allying with Beijing against Washington ahead of a Sino-European summit in Beijing on July 16-17.

Instead, in the tradition of every grand, if ultimately worthless meeting of the G-X nations, the summit is expected to produce a “modest communique”, which affirms the commitment of both sides to the multilateral trading system and promises to set up a working group on modernizing the WTO. Incidentally, the past two summits, in 2016 and 2017, ended without a statement due to disagreements over the South China Sea and trade. Then there is China’s “free-trade” reputation: a recent Rhodium Group report showed that Chinese restrictions on foreign investment are higher in every single sector save real estate, compared to the European Union, while many of the big Chinese takeovers in the bloc would not have been possible for EU companies in China. And while China has promised to open up, EU officials expect any moves to be more symbolic than substantive.

Read more …

Caving.

EU Reportedly Considering International Talks To Cut Car Tariffs (CNBC)

European officials are considering holding talks on a tariff-cutting deal between the world’s largest car exporters to prevent an all-out trade war with the U.S., according to the Financial Times who cited diplomats briefed on the matter. The proposal is being looked at by officials in Brussels, the administrative heartland of the European Union, ahead of a meeting between Jean-Claude Juncker, the president of the European Commission, and President Donald Trump in Washington later in July, the report published Wednesday said.

The FT reported that three diplomats, which it did not name, said the European Commission “is studying whether it would be feasible to negotiate a deal with other big car exporters such as the U.S., South Korea and Japan.” Such a move could address Trump’s complaint that the U.S. sector is unfairly treated, while reducing export costs for other participating countries’ auto sectors. “Under such a deal, participants would reduce tariffs to agreed levels for a specified set of products — a concept in international trade known as a ‘plurilateral agreement’ that lets countries strike deals on tariffs without including the entire membership of the WTO,” the FT said.

Read more …

Even Italy has a big surplus.

Germany’s Massive Trade Surplus ‘Is Becoming Toxic,’ Ifo Director Says (CNBC)

Germany exporting more than it imports is becoming a big problem for its economy, a director from the country’s closely-watched Ifo Institute said Wednesday. “(The trade surplus) is turning out to be an increasing issue, not just with the U.S. but with other trade partners as well, and also within the European Union,” Gabriel Felbermayr, the director of the Ifo Center for International Economics at the Munich-based institute, told CNBC’s “Squawk Box Europe. “The surplus is becoming toxic, and also within Germany many argue now that we need to do something about it with the purpose of lowering it. It turns out to be a liability rather than an asset.”

Germany’s export-orientated, manufacturing economy and its resulting trade surplus — the value of its exports exceeding that of its imports — has long been a subject of criticism and Berlin has been pressured to encourage more domestic spending and boost imports. Trade surpluses are viewed as encouraging trade protectionism and worsening the economic problems of other countries. Germany’s trade surplus fell in 2017 for the first time since 2009, shrinking to $300.9 billion, data published in February by the country’s Federal Statistics Office showed. Still, its trade surplus with the U.S. was $64 billion.

[..] Eric Lonergan, macro fund manager at M&G, told CNBC on Wednesday that Trump might be mollified by European countries promising to address their current account surpluses. A current account surplus is a broader measure of the trade surplus, plus earnings from foreign investments and transfer payments. “(Regarding the trade surplus) the truth is it’s not just Germany anymore — central and eastern Europe, if you look at Hungary, Poland, the Czech Republic and take them as an aggregate, were running a big current account deficit before, now they’re running a big current account surplus,” he said. “Italy’s running a big current account surplus, the periphery is — so it’s the ‘Germanification’ of the whole of greater Europe.”

Read more …

Rumor has it that Boris Johnson will resign. Maybe he’ll wait until after England lose to Sweden in the World Cup.

Tories ‘Toast’ If They Don’t Deliver On Brexit, Theresa May Warned (Sky)

Theresa May has been warned the Tories will be “toast” if they fail to deliver on their Brexit promises, as eurosceptic MPs maintain the pressure on the prime minister ahead of a crunch meeting of her top team. As the PM prepares to gather ministers at her country retreat of Chequers on Friday, she has been put on notice by the European Research Group (ERG) of Conservative backbenchers. Around 40 members of the ERG met with chief whip Julian Smith on Wednesday, reports Sky’s senior political correspondent Beth Rigby. Our correspondent said that they told Mr Smith the party will be “toast” if it “welches” on its previous Brexit promises, adding that the roughly £40bn “divorce bill” should only be paid to Brussels on condition of getting a deal.

After the meeting, Jacob Rees-Mogg, who chairs the ERG, told Sky News that Mr Smith “doesn’t determine policies” and so backbench Brexiteers remain in the dark over the government’s plans beyond media reports. Asked about suggestions the PM could propose a UK-EU deal that keeps regulatory alignment with Brussels for goods, as well as keeping the same level of tariffs as the EU, Mr Rees-Mogg warned such an agreement is “not Brexit”. He insisted continued regulatory alignment would mean the UK “cannot do trade deals with the rest of the world” and would mean “we haven’t really left the EU”. “Indeed, worse than that, we’re a vassal state because we take the EU’s rules and have no say over them,” the Leave supporter added.

Read more …

Not for the diehards.

There Is Only Option On The Table: Soft Brexit (G.)

The proverbial can has been kicked down the proverbial road ever since Britain voted to leave the European Union in 2016. Don’t get me wrong. Can-kicking has a necessary place in politics. Theresa May has often had little choice but to resort to it. But the road and the can-kicking must end at Chequers on Friday. That’s when the prime minister and her divided cabinet must finally decide what kind of relationship they seek with the EU after Brexit. In the end, May’s government faces the same two choices at Chequers that it has faced throughout all the twists and turns of the Brexit negotiations.

Either the government must embrace a form of soft Brexit that it can then persuade the rest of Europe to accept as a proper basis for good future relations – the option that May herself and the chancellor, Philip Hammond, both prefer and will put forward – or it must reject that option and prepare for a no-deal Brexit, in which all of Britain’s economic and political relations with Europe and the rest of the world become matters of pure conjecture. There are no other choices on the table. If Brexit is to go ahead, it is simply one or the other. This means, therefore, that only the first of the two choices is in fact a serious option.

If the cabinet rejects May’s and Hammond’s approach and adopts a no-deal option as government policy, there would be both a parliamentary and an extra-parliamentary revolt against it. Large businesses such as British Airways might relocate to Europe. Labour might even find an explicit anti-Brexit voice. One way or another, the no-deal approach would therefore explode on the launch pad. And Brexit might even not take place. Most ministers are neither idiots nor wreckers, so the no-deal option is not going to happen. It is even questionable as to whether any of the no-dealers will resign. The much more serious question, though, is whether the soft Brexit package that May wants to sell to the cabinet is much of a runner either.

Read more …

If they’re capable of Windrush, they can do this too.

UK Home Office Separating Scores Of Children From Parents (Ind.)

The Home Office is separating scores of children from their parents as part of its immigration detention regime – in some cases forcing them into care in breach of government policy. Schools, the NHS and social services have written letters to the department begging them to release parents from detention because of the damaging impact it is having on their children. Bail for Immigration Detainees (Bid), a charity that supports people in detention, said they have seen 170 children separated from their parents by the Home Office in the past year – and believes there are likely to be many more.While usually the youngsters remain in the care of their other parent, the charity has seen a number of cases where children are taken into local authority care as a result of the detention.

Case workers highlight that this is in breach of Home Office guidelines, which state that a child “must not be separated from both adults if the consequence of that decision is that the child is taken into care”. In one case, three young children were taken into care for several days after their dad was detained earlier this year – an experience that left them traumatised and fearful that he will be “taken away” again. Kenneth Oranyendu, 46, was detained in March while his wife was abroad for her father’s funeral. Despite the Home Office being aware of this, they kept him in detention and his four young children were forced to go into care.

Read more …

Japan’s toast without the punch bowl.

Bank of Japan Takes Away Punch Bowl, Balance Sheet Declines (WS)

In June, total assets on the Bank of Japan’s balance sheet dropped by ¥3.79 trillion yen ($34 billion) from May, to ¥537 trillion ($4.87 trillion). It was the third month-over-month drop in seven months, and the first such drops since late 2012, when the Abenomics-designed blistering “QQE” (Qualitative and Quantitative Easing) kicked off. So has the “QQE Unwind” commenced? This chart shows the month-to-month changes of the total balance sheet. Note the trend over the past 16 months and the three “QQE unwind” episodes (red):

But this sporadic balance sheet reduction and the overall “tapering” of its growth contradict the official rhetoric. Bank of Japan Governor Haruhiko Kuroda along with most of his colleagues keep insisting that the BOJ would “patiently” maintain its ultra-easy monetary policy and that it would “keep expanding the monetary base until inflation is above 2%.” The blistering asset purchases would add about ¥80 trillion ($725 billion) to the balance sheet every year. And the BOJ has repeatedly affirmed its short-term interest-rate target of a negative -0.1%.

[..][ Under QQE, the BOJ has been buying mostly Japanese government securities (JGBs and short-term bills); it also purchased corporate bonds, Japanese REITs, and equity ETFs. But now, the party appears to be ending, despite the speeches to the contrary. From the distance, however, the flattening out (tapering) of the BOJ’s assets is barely noticeable, given the magnitude of the whole pile that amounts to about 96% of Japan’s GDP (the Fed’s balance sheet amounted to about 23% of US GDP at the peak):

Read more …

I’d say China is much worse than the graph indicates.

India Is Emerging As Ground Zero Of The World’s Biggest NPL Crisis (ZH)

While bad loans in the Italian banking system have received a ton of attention from investors who fear that the Italians could inadvertently blow up the European banking union, it’s not the only financial landmine lurking among the world’s ten largest economies. To wit, while Italy has the largest percentage of non-performing loans among the world’s largest economies, India isn’t far behind and India’s economic recovery is built on an even shakier foundation. According to Bloomberg, India’s $1.7 trillion formal banking sector is presently struggling with $210 billion in bad loans, most of which are concentrated within its state-owned banks. During the 2018 fiscal year, growth slowed to 6.7%, down from the previous year’s 7.1%, back to its levels from 2014, before Modi came to power.

The state banks have been so badly mismanaged that some analysts say the country’s banking crisis is an opportunity for private sector banks, as CNBC reported. “If you take a 10-year view, currently the private sector banks’ market share is 30 percent. Probably it will become 60 percent,” Sukumar Rajah, senior managing director at Franklin Templeton Emerging Markets Equity, told CNBC. As a result, he said, “the overall health of the banking system will improve because the better banks will be a bigger portion of the market and the weaker banks will become a smaller portion of the market.”

Some also see opportunities for investment bankers looking to underwrite corporate bond issuance in the country.. “My view is that, incrementally, a lot of long-term financing of corporate India can also be met by the corporate bond market, which has developed reasonably well,” he said. “Between the corporate bond market and the private banks, I think most of the requirements can be met as far as corporate India is concerned.” When it comes to lending directly to individuals, Prasad said that is mostly done by the private banks and non-banking financial companies.

Read more …

Can’t extradite someone who has broken none of your laws.

Kim Dotcom Loses New Zealand Extradition Appeal (AFP)

Megaupload founder Kim Dotcom suffered a major setback in his epic legal battle against online piracy charges Thursday when New Zealand’s Court of Appeal ruled he was eligible for extradition to the United States. The German national, who is accused of netting millions from his file sharing Megaupload empire, faces charges of racketeering, fraud and money laundering in the US, carrying jail terms of up to 20 years. Dotcom had asked the court to overturn two previous rulings that the Internet mogul and his three co-accused be sent to America to face charges. Instead, a panel of three judges backed the FBI-led case, which began with a raid on Dotcom’s Auckland mansion in January 2012 and has dragged on for more than six years.

The court said US authorities had “a clear prima facie case to support the allegations that the appellants conspired to, and did, breach copyright wilfully and on a massive scale for commercial gain”. Dotcom is accused of industrial-scale online piracy via Megaupload, which US authorities shut down when the raid took place. They allege Megaupload netted more than US$175 million in criminal proceeds and cost copyright owners US$500 million-plus by offering pirated content including films and music. “We are disappointed with today’s judgment by the NZ Court of Appeal in the Kim Dotcom case,” his lawyer Ira Rothken tweeted, indicating there would be an appeal to the Supreme Court.

“We have now been to three courts each with a different legal analysis – one of which thought that there was no copyright infringement at all.” Dotcom and his co-accused – Finn Batato, Mathias Ortmann, Bram van der Kolk – have denied any wrongdoing and say Megaupload was simply a case of established interests being threatened by online innovation. The website was an early example of cloud computing, allowing users to upload large files onto a server so others could easily download them without clogging up their email systems. At its height in 2011, Megaupload claimed to have 50 million daily users and account for 4% of the world’s internet traffic.

Read more …

How people are made.

Babies (CJ)

When a baby is born, its parents teach it how to eat solid foods and walk and talk, which generally works out fine. Then they start teaching the baby all the lies their parents taught them, and things start to get messy. When the baby is old enough, they send it to school, where it spends twelve years being taught lies about how the world works so that one day it will be able to watch CNN and say “Yes, this makes perfect sense” instead of “This is ridiculous” or “Why does this whole entire thing seem completely fake?” or “I want to punch Chris Cuomo in the throat.” The baby is taught history, which is the study of the ancient, leftover propaganda from whichever civilization happened to win the wars in a given place at a given time.

The baby is taught geography, so that later on when its country begins bombing another country, the baby’s country won’t be embarrassed if its citizens cannot find that country on a globe. The baby is taught obedience, and the importance of performing meaningless tasks in a timely manner. This prepares the baby for the half century of pointless gear-turning it will be expected to undertake after graduation. The baby is taught that it lives in a free country, with a legitimate electoral system which facilitates meaningful elections of actual representatives in a real government. It is never taught that those elections, representatives and government are all owned and operated by the very rich, who use them to ensure policies which make them even richer while keeping everyone else as poor as possible so that they won’t have to share political power.

It is never taught that highly secretive intelligence and defense agencies form alliances with those rich people to advance murderous and exploitative agendas for profit and power. It is never taught that the things it sees on television are mostly lies. The baby is smoothly, seamlessly funneled from uterus to full-time employment through this system, often with a little religion mixed in to really drive home the importance of obedience and meekness and the nobility of poverty.

Read more …

Waiting for my man

May 162018
 


Carl Spitzweg The raven 1845

 

Julian Assange appears to be painfully close to being unceremoniously thrown out of the Ecuadorian embassy in London. If that happens, the consequences for journalism, for freedom of speech, and for press freedom, will resound around the world for a very long time. It is very unwise for anyone who values truth and freedom to underestimate the repercussions of this.

In essence, Assange is not different from any journalist working for a major paper or news channel. The difference is he published what they will not because they want to stay in power. The Washington Post today would never do an investigation such as Watergate, and that’s where WikiLeaks came in.

It filled a void left by the media that betrayed their own history and their own field. Betrayed the countless journalists throughout history, and today, who risked their lives and limbs, and far too often lost them, to tell the truth about what powers that be do when they think nobody’s looking or listening.

Julian is not wanted because he’s a spy, or even because he published a number of documents whose publication was inconvenient for certain people. He is wanted because he is so damn smart, which makes him very good and terribly effective at what he does. He’s on a most wanted list not for what he’s already published, but for what he might yet publish in the future.

He built up WikiLeaks into an organization that acquired the ultimate trust of many people who had access to documents they felt should be made public. They knew he would never betray their trust. WikiLeaks has to date never published any documents that were later found out to be false. It never gave up a source. No documents were ever changed or manipulated for purposes other than protecting sources and other individuals.

 

Julian Assange built an ’empire’ based on trust. To do that he knew he could never lie. Even the smallest lie would break what he had spent so much time and effort to construct. He was a highly accomplished hacker from a very young age, which enabled him to build computer networks that nobody managed to hack. He knew how to make everything safe. And keep it that way.

Since authorities were never able to get their hands on WikiLeaks, its sources, or its leader, a giant smear campaign was started around rape charges in Sweden (the country and all its citizens carry a heavy blame for what happened) and connections to America’s favorite enemy, Russia. The rape charges were never substantiated, Julian was never even interrogated by any Swedish law enforcement personnel, but that is no surprise.

It was clear from the get-go what was happening. First of all, for Assange himself. And if there’s one thing you could say he’s done wrong, it’s that he didn’t see the full impact from the campaign against him, sooner. But if you have the world’s largest and most powerful intelligence services against you, and they manage to find both individuals and media organizations willing to spread blatant lies about you, chances are you will not last forever.

If and when you have such forces running against you, you need protection. From politicians and from -fellow- media. Assange didn’t get that, or not nearly enough. Ecuador offered him protection, but as soon as another president was elected, they turned against him. So have news organizations who were once all too eager to profit from material Assange managed to obtain from his sources.

 

That the Guardian today published not just one, not two, but three what can only be labeled as hit pieces on Julian Assange, should perhaps not surprise us; they fell out a long time ago. Still, the sheer amount of hollow innuendo and outright lies in the articles is astonishing. How dare you? Have you no shame, do you not care at all about your credibility? At least the Guardian makes painfully clear why WikiLeaks was needed.

No, Sweden didn’t “drop its investigation into alleged sexual offences because it was unable to question Assange”. The Swedes simply refused to interview him in the Ecuador embassy in London, the only place where he knew he was safe. They refused this for years. And when the rape charges had lost all credibility, Britain asked Sweden to not drop the charges, but keep the pressure on.

No, there is no proof of links from Assange to Russian hackers and/or to the Russian government. No, there is no proof that DNC computers were hacked by Russians to get to John Podesta’s emails. In fact there is no proof they were hacked at all. No, Ecuador didn’t get tired of Julian; their new president, Moreno, decided to sell him out “at the first pressure from the United States”. Just as his predecessor, Correa, said he would.

Julian Assange has been condemned by Sweden, Britain, the US and now Ecuador to solitary confinement with no access to daylight or to medical care. Without a trial, without a sentence, and on the basis of mere allegations, most of which have already turned out to be trumped up and false. This violates so many national and international laws it’s futile to try and count or name them.

It also condemns any and all subsequent truth tellers to the prospect of being treated in the same way that Julian is. Forget about courts, forget about justice. You’ll be on a wanted list. I still have a bit of hope left that Vladimir Putin will step in and save Assange from the gross injustice he’s been exposed to for far too many years. Putin gets 100 times the lies and innuendo Assange gets, but he has a powerful nation behind him. Assange, in the end, only has us.

What’s perhaps the saddest part of all this is that people like Chelsea Manning, Kim Dotcom, Edward Snowden and Julian Assange are among the smartest people our world has to offer. We should be cherishing the combination of intelligence, courage and integrity they display at their own risk and peril, but instead we let them be harassed by our governments because they unveil inconvenient truths about them.

And pretty soon there will be nobody left to tell these truths, or tell any truth at all. Dark days. By allowing the smartest and bravest amongst us, who are experts in new technologies, to be silenced, we are allowing these technologies to be used against us.

We’re not far removed from being extras in our own lives, with all significant decisions taken not by us, but for us. America’s Founding Fathers are turning in their graves as we speak. They would have understood the importance of protecting Julian Assange.

To say that we are all Julian Assange is not just a slogan.

 

 

Jan 232018
 
 January 23, 2018  Posted by at 10:56 am Finance Tagged with: , , , , , , , , , , , ,  


William Claxton John Coltrane at the Guggenheim Museum, New York 1960

 

Trump Makes First Big Trade Move With Tariffs Aimed At Asia (BBG)
The Shutdown Scam: The GOP Is Now The Second “Government Party” (Stockman)
Blow Back (Jim Kunstler)
IMF Raises Global Growth Forecast, Sees Trump Tax Boost (R.)
IMF: Next Recession Will Come Sooner And Will Be Harder To Fight (EuA)
Rising Interest Payments Matter (NMT)
UK Business Leaders Push For New Campaign To Reverse Brexit (G.)
Kim Dotcom Sues New Zealand Government For Billions in Damages (BBC)
Ecuador’s Correa ‘Afraid for Julian Assange’s Safety’ (TeleSur)
Australia Sends Dozens Of Refugees From Pacific Camps To US (AFP)
Angela Merkel Has Completely Reversed Her Refugee Policies (Spiegel)

 

 

Make your own solar panels. What’s wrong with that?

Trump Makes First Big Trade Move With Tariffs Aimed At Asia (BBG)

President Donald Trump imposed tariffs on imported solar panels and washing machines, in his first major move to level a global playing field he says is tilted against American companies. The U.S. will impose new duties of as much as 30 percent on foreign-made solar equipment, the U.S. Trade Representative’s office said Monday. The president also approved tariffs starting as high as 50 percent on imported washing machines. Chinese and South Korean officials condemned the move, analysts said it could backfire, while markets largely shrugged it off. The tariffs were announced as Trump prepares to travel to the World Economic Forum in Davos, Switzerland, where the international business and political elite gather to mull the current state of the global order.

While the measures may sharpen the president’s “America First” policy after months of rhetoric and herald a hotter trade conflict with China, in Asia manufacturers and investors said the reality wasn’t as bad as they had feared. Investors “are used to bluff from Trump, which often turns out to be a non-event,” said Qiu Zhicheng at ICBC International Research in Hong Kong. “As long as the situation doesn’t escalate into a full-scale trade war, the market impact will be limited. We believe the two economies will stay rational, as a trade war would hurt both.” LG Electronics, a maker of domestic appliances, and South Korean solar panel makers fell initially in Seoul trading on the news before recovering. Samsung said the tariff on washing machines is a “great loss” for U.S. workers and consumers.

South Korea’s trade minister said Tuesday that his nation will file a petition with the World Trade Organization against the U.S. for imposing anti-dumping duties on Korean washing machine and solar panel makers. The U.S. decision is “excessive,” Kim Hyun-chong said. China exported more than 21 million washing machines worth just under 19 billion yuan ($2.9 billion) globally from January through November 2017, according to customs data. China is also the world’s largest exporter of solar panels.

Read more …

David knows his shutdowns.

The Shutdown Scam: The GOP Is Now The Second “Government Party” (Stockman)

Nowadays, government “shutdowns” are obviously not all that, and we do claim some expertise on the topic. Since 1975 there have been 14 shutdowns and we have had the privilege of being on-hand up close and personnel during 11 of these. Five shutdowns occurred while your editor was a member of the US House (1977-1981) and another six during his stint as director of OMB. The idea back then, needless to say, was that shutdowns came about mainly when anti-spenders refused to capitulate to the incessant demands of the swamp creatures for more appropriations, pork and graft.

[..] What is really happening, of course, is that the Trumpite/GOP is proving in spades that America is now saddled with two pro-government parties. This means a good shutdown is going to waste and that there is no stopping the fiscal doomsday machine that is now racing toward a national calamity, unimpeded. After all, the reason Washington is operating on its 3rd CR of the fiscal year and struggled a whole weekend to get a fourth one lasting a mere 16 days, lies in the utter irresponsibility of the Trump GOP approach to fiscal policy.

These clowns want to spend $120 billion on disaster relief without a single dime of off-setting cuts; raise defense by $80 billion when the Pentagon is already a $620 billion swamp of waste; appropriate $33 billion for an utterly idiotic Wall on the Mexican border when the problem could be solved by cancelling the $32 billion per year “War on Drugs” and putting up guest worker sign-up booths along the border; and authorizing tens of billions on top of that to pay for the backroom “deals” that were made in order to get the votes for a massive tax bill that not a single Senators or House member had read before it was ram-rodded into law by desperate GOP leaders on Christmas Eve.

So this shutdown is indeed different. Unlike the case back in the day, there is no fiscal red line whatsoever at issue; only a prospective eruption of more red ink and an interim game of political chicken about 700,000 Dreamers, who at the end of the day will not be deported and who will eventually get a path to citizenship. That’s because they, and millions of more immigrants to come, comprise the only available “growth” margin for the US work force in the decades ahead; and therefore constitute the next generation of Tax Mules which will be absolutely necessary to support today’s 50 million retirees. That is, as their population inexorably swells toward 100 million during the next four decades.

Read more …

Pressure on the FBI is set to increase tenfold.

Blow Back (Jim Kunstler)

On Sunday, the FBI revealed that it had lost five months of text messages between Trump antagonists Peter Strzok and Lisa Page. The agency offered a lame explanation that “software upgrades” and “misconfiguration issues” interfered with the app that is supposed to automatically save and archive communications between officials on FBI phones. This was the couple who chattered about an FBI-generated “insurance policy” for the outcome of the 2016 election with Deputy Director Andrew McCabe. When will these three be invited to testify before a house or senate committee to inform the nation exactly what the “insurance policy” was?

The bad odor at the FBI seeps into several other areas of misbehavior involving Hillary Clinton, her campaign, the Democratic National Committee (DNC), and members of the permanent Washington bureaucracy. Did the Obama White House use the Christopher Steele dossier, paid for by the Clinton Campaign, to obtain FISA warrants against her opponent in the election for the purpose of conducting electronic surveillance on him? Was the FBI abetting a Democratic Party coup to get rid of Trump by any means necessary once he got into office?

Did the FBI conduct a stupendously half-assed investigation into Hillary Clinton’s private email server by dismissing the charges before interviewing any of the principal characters involved, granting blanket immunities to Obama White House officials, and failing to secure computers that contained evidence? Does the FBI actually know what then Attorney General Loretta Lynch discussed with Bill Clinton in the parked airplane on the Phoenix tarmac? Did the FBI fail to investigate enormous contributions (roughly $150 million) to the Clinton Foundation after the Uranium One deal was signed? Did they look into any of the improprieties surrounding the DNC’s effort to nullify Bernie Sander’s primary campaign?

Read more …

Growth is God.

IMF Raises Global Growth Forecast, Sees Trump Tax Boost (R.)

The IMF on Monday revised up its forecast for world economic growth in 2018 and 2019, saying sweeping U.S. tax cuts were likely to boost investment in the world’s largest economy and help its main trading partners. However, the IMF, in an update of its World Economic Outlook, also added that U.S. growth would likely start weakening after 2022 as temporary spending incentives brought about by the tax cuts began to expire.\ The tax cuts would likely widen the U.S. current account deficit, strengthen the U.S. dollar and affect international investment flows, IMF chief economist Maurice Obstfeld said. “Political leaders and policymakers must stay mindful that the current economic momentum reflects a confluence of factors that is unlikely to last for long,” Obstfeld told reporters at the World Economic Forum in Davos.

He said economic gains from the tax cuts would be partially paid back later in the form of lower growth as temporary spending incentives, notably for investment, expired and as rising federal debt took a toll. IMF Managing Director Christine Lagarde pointed to a “troubling” increase in debt levels across many countries and warned policymakers against complacency, saying now was the time to address structural deficiencies in their economies. Obstfeld said a sudden rise in interest rates could lead to questions about the debt sustainability of some countries and lead to a disruptive correction in “elevated” equity prices.

Read more …

IMF wants their cake and eat it. They warn against the failure of their own policy recommendations.

IMF: Next Recession Will Come Sooner And Will Be Harder To Fight (EuA)

The global economy is growing faster than expected, fuelling CEO optimism as they arrive this week at the World Economic Forum (WEF) in Davos, Switzerland. But the IMFhas warned that the next crisis will hit sooner and harder that we thought. “In seed time learn, in harvest teach, in winter enjoy,” said IMF Managing Director Christine Lagarde, issuing a warning by quoting British poet William Blake to describe the state of mind of businessmen and politicians in the world. The global economy continues to beat previous forecasts. The Fund revised upward by 0.2% the growth expected for this year and next. In Europe, the IMF increased further its outlook by 0.3% in 2018 (2.2%) and in 2019 (2%). But “complacency is one of the risks we should go against”, Lagarde told reporters in Davos hours before the official opening of the WEF.

The economy is growing but not because countries have lifted their growth potential via investment in human capital or technology. Instead, reforms have been elusive and growth has benefited just the few that are on top of the pile. “We are not satisfied,” Lagarde insisted, because “too many people have been left out of the acceleration of growth”. Against the backdrop of fragile growth and outstanding challenges, including a high level of debt, the Fund’s chief economist, Maurice Obstfeld, stressed that “the next recession will come sooner and will be harder to fight”. He warned political leaders that the economic momentum is due to factors that are “unlikely to last for long”, including the monetary stimulus and supportive fiscal stance. For that reason, he urged countries to adopt measures aimed at improving the resilience of their societies in the fast-changing digital revolution and to improve the inclusiveness of their societies.

Read more …

Another huge surge in debt. Insane. But the only way to keep the zombie from dying.

Rising Interest Payments Matter (NMT)

Is anyone paying attention? I don’t know, but the cost of carrying debt has been rising and it’s already showing measurable impacts despite the Fed Funds rate still being very low. My concern of course is that the global debt construct will bring global growth to a screeching halt (see also The Debt Beneath). As the 10 year is already piercing above the 2.6% area now I want to pay attention to the data coming in as the Fed is dot plotting more rate hikes to come. After all the Fed has hiked 5 times off the bottom floor in the past 2 years:

Can we see any measurable impact? You bet we can. Here are personal interest payments for consumers:

Mind you we are still near the lows of the previous cycle and already total interest payments are near record highs. The driver of course is record consumer debt and credit card debt. But despite rates still being historically low this rise in interest rates has an impact on the consumer. Already we see this: “The big four US retail banks sustained a near 20 per cent jump in losses from credit cards in 2017, raising doubts about the ability of consumers to fuel economic expansion. “People are using their cards to get from pay cheque to pay cheque,” said Charles Peabody, managing director at the Washington-based investment group Compass Point. “There’s an underlying deterioration in the ability of the consumer to keep up with their debt service burden.” Recently disclosed results showed Citigroup, JPMorgan Chase, Bank of America and Wells Fargo took a combined $12.5bn hit from soured card loans last year, about $2bn more than a year ago.”

I repeat: “There’s an underlying deterioration in the ability of the consumer to keep up with their debt service burden.” [..] “Economists with Deutsche Bank expect the extra debt the Treasury must issue to fund President Donald Trump’s tax package and the amount of debt the Federal Reserve plans to redeem at maturity this year will bloat issuance to about $1tn in 2018. That’s up more than 50 per cent from a year earlier and, when coupled with a 30 per cent rise in the amount of corporate debt that’s due to mature, leaves questions of who the eventual buyer will be.“ A good question indeed. That’s a lot of debt issuance:

Read more …

2018 will be the year of the Brexit reversal.

UK Business Leaders Push For New Campaign To Reverse Brexit (G.)

Business leaders are privately pushing for a new campaign to reverse Brexit as concerns mount about the viability of government plans to prevent a collapse in exports to Europe. On Monday, the CBI launched its most sustained attack yet on the government’s Brexit strategy by calling for full customs union with the EU and single market participation, even if it means abandoning the pursuit of separate trade deals with the rest of the world. Behind the scenes, senior figures on the CBI policy council are urging the lobby group to toughen its message still further and spell out their belief that this logic should ultimately lead to a national rethink of the decision to leave the EU, perhaps through a second referendum or an election.

While this is not the CBI’s official position, the group says it has decided to speak out about the problems of the government’s approach to Brexit after “thousands of conversations” and workshops with its members over the past two to three months. “It’s not for us to say [whether to reverse Brexit], we are simply pointing out that you need single market access and you need a customs union,” said a spokesman. “If someone concludes that we therefore need to retest this, that’s a political decision, we are just being very practical about it.”

Government ministers reacted furiously to previews of the CBI’s evolving position over the weekend, which now directly challenges the British strategy of leaving the customs union so that new trade deals can be pursued outside a common tariff area. The CBI director general, Carolyn Fairbairn, told an audience at Warwick University on Monday: “There may come a day when the opportunity to fully set independent trade policies outweighs the value of a customs union with the EU; a day when investing in fast-growing economies elsewhere eclipses the value of frictionless trade in Europe. But that day hasn’t yet arrived.”

Read more …

The former government, to be exact.

Kim Dotcom Sues New Zealand Government For Billions in Damages (BBC)

Kim Dotcom, the founder of file-sharing site Megaupload, is suing the New Zealand government for billions of dollars in damages over his arrest in 2012. The internet entrepreneur is fighting extradition to the US to stand trial for copyright infringement and fraud. Mr Dotcom says an invalid arrest warrant negated all charges against him. He is seeking damages for destruction to his business and loss of reputation. Accountants calculate that the Megaupload group of companies would be worth $10bn (£7.2bn) today, had it not been shut down during the raid. As he was a 68% shareholder in the business, Mr Dotcom has asked for damages going up to $6.8bn. He is also considering taking similar action against the Hong Kong government.

As stated in documents filed with the High Court, Mr Dotcom is also seeking damages for: • all lost business opportunities since 2012 • his legal costs • loss of investments he made to the mansion he was renting • his lost opportunity to purchase the mansion • loss of reputation. “I cannot be expected to accept all the losses to myself and my family as a result of the action of the New Zealand government,” he told the BBC. “This should never have happened and they should have known better. And because they made a malicious mistake, there is now a damages case to be answered.” New Zealand Prime Minister Jacinda Ardern told Radio New Zealand: “This has obviously been an ongoing matter, so no it doesn’t surprise me.”

Mr Dotcom’s key argument over his extradition is the warrants used for the raid on his mansion and arrest in January 2012 were based on Section 131 of the 1994 Copyright Act of New Zealand. “Under the NZ copyright act, online copyright infringement is not a crime,” said Mr Dotcom. “92B of Section 131 – an amendment created by parliament in 2012 – prohibits any criminal sanction against an internet service provider in New Zealand. “In order for the US to be successful with an extradition, the allegation of the crimes that they are charging someone with also have to be a crime in the country from which they request the extradition.”

Read more …

We must find ways to protect Assange et al.

Ecuador’s Correa ‘Afraid for Julian Assange’s Safety’ (TeleSur)

Former Ecuadorean president Rafael Correa has warned that WikiLeaks founder Julian Assange’s days are numbered at the Ecuadorean Embassy in London. Correa, who gave Assange asylum back in 2012, said that he’s “afraid for Julian Assange’s safety” due to the new government´s actions with regards to his case. He said that he believes President Lenin Moreno is likely “take away the support” previously afforded to the anti-secrecy activist. “It will only take pressure from the United States to” withdraw protection for Assange and “surely it’s already being done, and maybe they await the results of the Feb. 4 (referendum) to make a decision,” said Correa, in an article published by AFP.

When asked does he have evidence to support his claim, Correa said it’s clear that Moreno “has no convictions, it’s clear that he has yielded to the usual powerbrokers” and will “soon enough yield regarding the question of Assange.” The 54-year old economist added that the ambassador for the United States was shamelessly interfering in Ecuador’s internal affairs, something “hadn’t occurred during ten years” of his government. Earlier this week Correa officially left the ruling PAIS Alliance, the leftist political movement he founded in 2006 and which he first rose to political prominence. Having referred to Moreno as a “traitor,” someone who has called for an “unconstitutional” referendum that could spell an end to “democracy,” Correa went on to say that “they can rob us of Alianza Pais, but never our will and convictions. Despite the pain, this only strengthens us.”

Read more …

In the future, Manus will be compared to Birkenau.

Australia Sends Dozens Of Refugees From Pacific Camps To US (AFP)

Dozens of refugees held for years in Australia’s remote Pacific detention camps departed for resettlement in the United States on Tuesday, asylum-seeker advocates said. The Sydney-based Refugee Action Coalition said 40 men flew out from Papua New Guinea’s capital Port Moresby under a deal struck by Australia with former US president Barack Obama but bitterly criticised by his successor Donald Trump. “It was a bitter-sweet moment for the refugees — who on the one hand, are happy to be gaining the freedom that Australia denied them more than four years ago; but on the other, they remain extremely concerned for those that are being left behind,” the advocacy group said in a statement.

The refugees, from camps on Manus Island, flew to Manila from where they will fly on to the US in different groups in the coming weeks before being resettled across the country, it said. The group released photos showing the refugees lining up before dawn to get on buses for the airport, then waiting at the gate to board their flight to Manila. Another 18 men were due to leave Port Moresby in the coming weeks, it said. [..] Canberra sends asylum-seekers who try to reach Australia by boat to detention camps in Manus and the Pacific island of Nauru under a tough policy designed to choke off the flow of refugees to the country. More than 1,000 still remain in limbo in the remote locations.

Canberra has strongly rejected calls to move the refugees to Australia and instead has tried to resettle them in third countries, including the United States. But until now only about 50 refugees have been sent to the US, under an agreement President Trump attacked after taking office as a “dumb deal”. The Refugee Action Coalition said a further 130 people on Nauru have been accepted by the US and are expected to depart next month.

Read more …

Merkel can’t take that she’s yesterday’s news.

Angela Merkel Has Completely Reversed Her Refugee Policies (Spiegel)

It’s no longer about people, it’s about a number. It’s about the number of refugees who come to Germany, not about the refugees themselves. The most recent number is 223,000: That’s how many asylum applications were submitted last year, a far cry from the 746,000 applications received in 2016. The new number is rather convenient for Angela Merkel in that it is extremely close to the upper limit of 220,000 that has found its way into the German chancellor’s preliminary coalition outline agreed to by Merkel’s conservatives and the center-left Social Democrats (SPD). This number is the expression of a political policy that has never been clearly verbalized and never been adequately explained. It is the expression of an about-face on refugee policy, away from open borders and toward harsh rejection.

Late in the summer of 2015, Merkel said that if Germany cannot show “a friendly face” in an emergency, “then it is not my county.” She kept the borders open to the incoming refugees, and much of the world was inspired by her humanitarian approach. Now, however, Germany is presenting a much less friendly face to the world. And the German chancellor has no country anymore. But that doesn’t seem to be bothering her. Indeed, her views would seem to have completely changed. In 2016, Merkel engineered a deal with Turkey on behalf of the European Union which essentially shut down the refugee route across the Aegean Sea from Turkey to Greece. She also agreed to demands from the conservative Christian Social Union (CSU), the Bavarian sister party to her own Christian Democrats (CDU), that an annual upper limit be established, though it isn’t allowed to be called an “upper limit.”

In the future, there is also to be a 1,000-per-month upper limit applied to family reunifications for most refugees. That is too low. The CDU and CSU are fond of emphasizing family values, yet they have joined forces to limit family reunification — even though it should be clear to everyone that men have the best chances at integration if they live here together with their families. But none of that matters anymore. The parties only care that the number is low. And SPD leaders are going along without complaint. That, too, is a disappointment.

Read more …

Mar 082017
 
 March 8, 2017  Posted by at 7:04 pm Finance Tagged with: , , , , , , , , , ,  


Pablo Picasso Girl Before A Mirror 1932

 

Obviously, like hopefully many people, I’ve been following the WikiLeaks CIA revelations, and closely. It’s too early for too many conclusions, if only because WikiLeaks has announced much more will flow from that same pipeline. But one thing is already clear: the CIA is -still- a club that sees enemies behind every tree, and behind every TV set too. Which is not as obvious a world view as it may seem; it’s just something we’ve become used to.

Moreover, as we see time and again, organizations like the CIA and NATO have no qualms about ‘creating’ enemies if they are in short supply. The flavor du jour has now been, for years, Russia, but don’t be surprised if another one is cultivated alongside it. ISIS, China, North Korea, plenty of options, and plenty of media more than willing to aid the cultivation process. It’s a well-oiled machine geared towards making something out of nothing, a machine very adept at making you believe anything it wants you to.

In this way, our friends can become our enemies, and our enemies our friends. What gets lost in translation is that this way in reality we become our own worst enemies. While the upper and most secretive layers of society, filled with folk of questionable psychological constitution -sociopaths and psychopaths-, get to chase their dreams of wealth and power, those who try to live normal decent lives are, for that very purpose, increasingly subjected to poverty, misery and fear. As our economies decline further, this will only get worse.

 

Who needs your -conscious- vote or voice if these can be easily manipulated? Or do you not think you’re being manipulated? How many of you, American or European, think Russia is an actual threat to you? I’m afraid by now there’s a majority on each continent who perceive Putin as an evil force. The president of a country that spends one-tenth on its military of what the US does. Trump’s announced military spending increase alone is almost as much as Russia spends in a whole year.

If Putin is really the threat he’s made out to be, to both Europe and the US, he must be extremely smart; merely devious wouldn’t do it. A man who can be an active threat to two entire continents and almost a billion people while spending a fraction on building that threat of what those he threatens do, must be a genius. Or the victim of media-politico manipulation.

But we don’t stop there. As the CIA spying and hacking files once again make abundantly clear, America increasingly seeks its enemies at home. This may be presented in the shape of Donald Trump, or terrorists on US soil, imported or not, but claiming that we can still tell a real threat from an invented one is no longer credible. We are led along on a propaganda leash 24/7, and the best thing about it is we believe we are not. That’s why it’s a good idea to pay close attention to what WikiLeaks is telling us.

The most extreme example of the political machinery turning our friends into enemies is probably right there, in the WikiLeaks and whistleblower corner of society. Earlier today I wrote:

The CIA spent a huge wad of taxpayer money on this, and then lost it all. It’s early days to say what this will mean for the agency’s abilities, and the nation’s safety, as well as that of American citizens, but it’s not good. Question is: who’s going to investigate how this could have happened? (Snowden and Kim Dotcom could)… And who’s going to repair the damage done? Anyone could be spying on your phone and your TV by now, not just the CIA -as if that wouldn’t be bad enough.

Then later I saw I wasn’t the only one who had thought of this:

 

 

Edward Snowden and Kim Dotcom and Julian Assange and Chelsea Manning are ‘the enemy’, so say our ‘leaders’. They have received this honorable label for exposing secrets these same leaders were trying to hide from us. Secrets most of us, if we think it over, would say should not be kept from us. The NSA spying on the American people, or the CIA turning your phones and TVs and cars into objects that can be used against you, these are things that don’t belong in our societies.

Still, as I’ve always said, if they can do it -from a technical point of view-, they will, damn the law. So we will have to make very sure the laws keep up with these developments, or we’re defenseless. The Obama administration hasn’t been much help with this, and the rest of Washington won’t be either, they’re not just part of the machine, they are the engine that drives the machine. Obama allegedly gave in to the CIA for fear of ending up like JFK and the rest, along with the press, is under control too.

So perhaps Trump is our best chance at putting a stop to this coup, this deep state, from taking over. If we still can. And for that we might well need Snowden and Dotcom and Assange, who are not the enemies they are made out to be, they are the smartest among us, or at least they belong right up there. And they are not only the smartest, they are the bravest too. Locking them up would be a huge disservice to our societies, it would be much better to ask them to help us figure out what game the hell is being played.

 

One thing the WikiLeaks files accomplished is they made and and all accusations of Russian hacking, and of links between Trump and Russia, utterly meaningless in one fell swoop. Because the CIA has acquired the capability, both through hacking Russian files and through coding, to leave ‘footprints’ that make it look like the Russians left them. And the only ‘proof’ there ever was for all these accusations was based on these footprints. That’s one narrative that must now be restarted from scratch -just one of many.

All we need now is for Trump to figure out who his enemies are, and who his friends. He already knows the CIA is not his friend, but has he figured out yet that the whistleblowers are not his enemy? And has his crew? Kim Dotcom is right, Trump is in real danger, he’s been watched, and being watched, 24/7. Whether Obama ordered that or not is not very relevant. There are more urgent matters at hand.

And somewhere along the way he’s going to have to figure out that chasing women and children around the country and out of it is not just ugly, it’ll cost him too much sympathy too. But so far all protests come from the Democrats and their supporters, who have all been left voiceless and shapeless by the election and now see their Russian conspiracy narratives blown to smithereens too, so why wouldn’t he please his own voters for a bit longer?

Well, for one thing, because he has to start to realize he’s going to need very broad support, and soon, be a president for all Americans so to speak, to fend off the CIA et al, and in what may be the hardest thing to do, he needs to invoke transparency, explain to people exactly what he does, and why, to drain the deep swamp.

If he fails in all this, and for now the odds point in that direction, those who protest him today will feel validated, right, and winners. They will be tragically wrong. Because if Trump loses this, the CIA wins. And then we will all live in 1984 for as far into the future as we can see.

I know there’s a lot that’s not to like about Trump and Bannon and all those guys. However, look at it this way: they are the only ones who can keep the doors of the vault from slamming shut for the rest of our lives, leaving time for y’all to wake up and find a president who doesn’t seek to turn your friends into your enemies. At least you’ll still have that choice.

With present-day Washington, Democrat or Republican, there’s no such choice. They’re CIA, as are the media. Kim Dotcom tweeted this too today: