May 072020
 


Banksy – Sounthampton General Hospital – 2020

 

 

Coronavirus May Have Jumped To Humans As Early As October (SCMP)
Italian Scientists Claim To Have Developed World’s First Coronavirus Vaccine (Ind.)
Trump Calls Americans ‘Warriors’ In Fight To Open The Economy (LAT)
Are Americans Ready For A -Costly- Breakup With China? (CSM)
Coronavirus Survivors ‘Permanently Disqualified’ From Joining US Military (NW)
California Expected To Experience ‘Jaw-Dropping’ Unemployment – Newsom (JTN)
UK GPs In The Dark Over COVID19 Tests (G.)
All 400,000 Gowns Flown From Turkey For NHS Fail UK Standards (G.)
COVID19 Deaths: How Does Britain Compare With Other Countries? (Spiegelhalter)
New Zealand ‘Halfway Down Everest’, Plans Big Easing Of COVID Lockdown (G.)
Baltic States To Create ‘Travel Bubble’ As Pandemic Curbs Eased
China’s Services Sector Contracts For Third Month As Job Losses Hit Record (R.)
Republicans Want Review Of Aid To WHO (R.)
OPCW Chief Made False Claims To Denigrate Douma Whistleblower (Maté)
Cuomo Taps Bill Gates To Help Him ‘Reimagine’ New York’s Public Schools (JTN)

 

 

The US had +2,528 new coronavirus deaths yesterday, the highest number since April 21, bringing the national total to 74,799.

 

 

 

 

Cases 3,836,826 (+ 92,061 from yesterday’s 3,744,765)

Deaths 265,366 (+ 6,482 from yesterday’s 258,884)

 

 

 

From Worldometer yesterday evening -before their day’s close-

 

 

From Worldometer Deaths among Closed cases is down to 17%. That still needs to come down much more.

 

 

From SCMP:

 

 

From COVID19Info.live:

 

 

 

 

The FT has a section, Coronavirus: free to read, with a few good graphs.

They look at excess deaths as the best way to gauge COVID19.

And some more graphs:

https://twitter.com/RemiGMI/status/1258021339362885634

 

 

Makes sense.

Coronavirus May Have Jumped To Humans As Early As October (SCMP)

The Covid-19 pandemic might have started as early as October, according to the latest research into the genetic make-up of the coronavirus. The pathogen, formally known as SARS-CoV-2, is thought to have made the jump from initial host to humans some time between October 6 and December 11 last year, according to an article released on Tuesday and set to be published in an upcoming edition of the scientific journal Infection, Genetics and Evolution. The findings are based on analysis of more than 7,000 genome sequence assemblies collected from around the world since January. By examining the evolution of the mutations, researchers from University College London and the University of Reunion Island were able to rewind their molecular clocks to a common starting point.

They were also able to identify the major mutations to the coronavirus, which has continued to evolve since making the jump to humans. While retrospective studies have suggested various dates for the first Covid-19 patient, government data seen by the South China Morning Post put the first confirmed infection at November 17. Based on information from the first whole genome sequence of the coronavirus – published by a laboratory in Shanghai in January – and other genome analyses, scientists had earlier concluded that SARS-CoV-2 most likely came from a bat and made the jump to humans via an intermediate animal some time in November.

But by the time the latest study was conducted, late last month, the researchers had access to much more information via data-sharing platforms. They selected 7,710 assemblies, curated a data set of 7,666 and then analysed the emergence of genomic diversity over time. While there were variations in the mutations and evolutionary stages of the viruses they studied, the team was able to determine their most recent common ancestor (MRCA), which in turn gave them their new estimate for the start of the global health crisis. “These dates for the start of the epidemic are in broad agreement with previous estimates performed on smaller subsets of the Covid-19 genomic data using various computational methods, though they should still be taken with some caution,” the study said.

In most countries, including Britain, the United States and Ireland, the genetic diversity of the samples essentially reflects the global diversity, suggesting the local epidemics came from independent introductions of the virus. However, China, where the outbreak was first reported, is a main exception to this pattern, where only a fraction of the global diversity can be found. “The genomic diversity of the global SARS-CoV-2 population being recapitulated in multiple countries points to extensive worldwide transmission of Covid-19, likely from extremely early on in the pandemic,” the study said.

Read more …

2022 and onwards. Crushing the curve is much easier. And faster.

Italian Scientists Claim To Have Developed World’s First Coronavirus Vaccine (Ind.)

Italian researchers claim to have developed a vaccine that can neutralise the coronavirus in human cells. Tests carried out at Rome’s Lazzaro Spallanzani Hospital, which specialises in infectious diseases, generated antibodies in mice that work in human cells. “This is the most advanced stage of testing of a candidate vaccine created in Italy,” said Luigi Aurisicchio, chief executive of Takis, the company working on the treatment. “According to Spallanzani Hospital, as far as we know we are the first in the world so far to have demonstrated a neutralisation of the coronavirus by a vaccine,” he told the Italian news agency Ansa. “We expect this to happen in humans too.”

“Human tests are expected after this summer,” Mr Aurisicchio said. He added: “We are working hard for a vaccine coming from Italian research, with an all-Italian and innovative technology, tested in Italy and made available to everyone. “In order to reach this goal, we need the support of national and international institutions and partners who may help us speed up the process.” After a single vaccination, the mice developed antibodies capable of blocking the virus from infecting human cells, Mr Aurisicchio claimed. He said researchers observed that five candidate vaccines generated a large number of antibodies and they then selected the two with the best results.

Last week, experts at the University of Oxford said the first results of their coronavirus vaccine trials could be ready by as early as mid-June. The institution also announced a new partnership with British-Swedish pharmaceutical giant AstraZeneca. Human trials of the vaccine developed at the university’s Jenner Institute began last month, with hundreds volunteering to be part of the study.

Read more …

Some non-thinkers here: “Good generals do not send their soldiers into battle without knowing that there will be a net gain..”. Right, US generals only go into battle if and when they already know they will win. Must be a lesson learned in Vietnam.

Trump Calls Americans ‘Warriors’ In Fight To Open The Economy (LAT)

Donald Trump has described himself as a “wartime president” during the coronavirus crisis, and now he seems to have found his army as he pushes the country to reopen despite the risks. In recent days, he’s begun describing citizens as “warriors” in the battle against the pandemic and suggested some of those fighters might have to die if that will help boost the economy.“Will some people be affected? Yes,” he said on a trip to Arizona this week, his first outside of the Washington area in nearly two months. “Will some people be affected badly? Yes. But we have to get our country open, and we have to get it open soon.” Trump previously described healthcare workers as “warriors” for risking their safety to treat coronavirus patients, wording he used again on Wednesday when signing a proclamation honoring nurses.

But his decision to expand the characterization to everyday Americans is a noticeable shift from his previous declarations that “one is too many” deaths. The toll from the illness surpassed 70,000 this week and seems on track to top 100,000 by the end of the month, numbers far larger than Trump recently predicted. Asked Wednesday if the nation needs to accept greater loss of life, Trump said “hopefully it won’t be the case, but it may very well be the case.” “We have to be warriors,” he said from his seat behind the Resolute desk in the Oval Office. “We can’t keep our country closed down for years.” The new language shows Trump appears to view people as “collateral damage to salvage the economy,” said Jeffrey Levi, a public health expert at George Washington University.

“Good generals do not send their soldiers into battle without knowing that there will be a net gain,” Levi said. “And here we know reopening too soon will be a net loss, both in lives and the long-term stability of the economy.” White House Press Secretary Kayleigh McEnany denied that Trump was suggesting that citizens must put themselves in harm’s way to fight the coronavirus — “not in the slightest,” she said. Although the president has repeatedly said that Americans must be “warriors” to reopen the economy, McEnany offered an alternative explanation for the description. “They’re warriors because they’ve stayed home,” she said at a White House briefing Wednesday. “They’re warriors because they’ve social distanced. They’re warriors because this mitigation effort is something that could only be done by the American people coming together and making really hard sacrifices.”

[..] Ashish Jha, director of the Harvard Global Health Institute, said there’s no valor in sacrificing people’s lives to fight the pandemic. “People who are dying of this virus are not dying to protect the American way of life,” he said. “They’re dying because their government has had a completely ineffective response to this infectious disease.” If Americans are being considered warriors, Jha said, Trump is sending them onto the battlefield without the testing and contact tracing required for protection. “He has left Americans disarmed,” he said. “He’s not given the American people the tools they need to fight this virus.”

Read more …

See yesterday. Lots of people quoting the SCMP article today, but it’s just hot air.

Are Americans Ready For A -Costly- Breakup With China? (CSM)

[..] some longtime advocates of a “decoupling” from China say the pandemic offers the best opportunity since the 1970s for a robust national debate on the merits of a significant and policy-driven separation. Such a debate would span issues from technology transfer and U.S. economic sectors’ dependence on China trade to sharpening criticism of China’s violations of human rights. “Three months ago I would have said there was no chance of a serious decoupling from China, but the political environment has changed,” says Derek Scissors, an expert in U.S.-China economic relations at the American Enterprise Institute in Washington. “We’re still not near the serious – and what would be costly – steps necessary to separate [from them] and reduce our participation in the success of China’s economic model,” he adds.

“But all the outrage over the tremendous suffering and economic impact of [the pandemic] has opened a door to a reassessment of our relationship.” More likely than a new China strategy that sets out to reduce ties, say others, is an acceleration and intensification of actions that were already being pursued or promoted by some in Congress and some China analysts. “What this [rise in tensions] is really doing is exacerbating the geopolitical trends we’ve already been seeing in recent years,” says Michael Auslin, a distinguished research fellow in contemporary Asia at Stanford University’s Hoover Institution in Stanford, California. “The tensions were already growing.” Thus there is likely to be rising pressure for action on topics that have raged for years, from stemming the theft of intellectual property and repatriating supply chains critical to U.S. national security, to confronting China’s expansionist activities in the South China Sea.

A change that the U.S. and other Western countries should capitalize on in the post-pandemic period, some experts say, is that China is now going to be marked by many countries as an untrustworthy partner. That is not just because of how China handled the initial outbreak of the coronavirus, they say, but because its heavy-handed actions in its pandemic-related foreign assistance has left a bad taste from Europe to Africa. “The world has put an asterisk next to China,” says Mr. Auslin, who notes for example that the White House now puts an asterisk next to coronavirus statistics out of China. And the theme running through much of the European press last week, he says, was “The Week China Lost Europe.”

Read more …

No, not just survivors, but anyone who’s ever tested positive.

If that herd immunity idea ever goes anywhere, that would mean 60%+ can’t join anymore. Who said Americans have no sense of humor?

Coronavirus Survivors ‘Permanently Disqualified’ From Joining US Military (NW)

The military will stop recruiting applicants who have tested positive for COVID-19, according to a proposal in a memo from the U.S. Military Entrance Processing Command (MEPCOM). The contents of the memo, which has been circulating on the internet, were confirmed to Newsweek by the Pentagon, which described them as “interim guidance.” The story was first reported by the Military Times. “During the medical history interview or examination, a history of COVID-19, confirmed by either a laboratory test or a clinician diagnosis, is permanently disqualifying,” the memo reads. Additionally, the memo lays out guidelines for handling possible and confirmed coronavirus cases in applicants.


It says any applicants at any of the 65 nationwide Military Entrance Processing Stations (MEPS) should be evaluated for possible coronavirus infection, most likely through a temperature check and questions about their symptoms and possible contact with infected individuals. If an applicant seems likely positive for the coronavirus, they can return to the MEPS if they’re symptom-free after 14 days. Anyone who tests positive through a lab test or clinical diagnosis can return to MEPS 28 days after their diagnosis. However, their application will be marked as “permanently disqualifying,” and while applicants can request a waiver the memo offers no further guidance for possible COVID-19 exceptions, meaning that “a review authority would have no justification to grant a waiver,” says the Military Times.

Read more …

A lot of support for opening up also involves halting financial support plans. Worst idea ever, because:

California Expected To Experience ‘Jaw-Dropping’ Unemployment – Newsom (JTN)

California Governor Gavin Newsom forewarned of “jaw-dropping” unemployment at his daily press conference on Wednesday. After stating the state is experiencing an unprecedented spike in unemployment claims, he said, “You’ll see these numbers translating into unemployment rates that will be rather jaw-dropping.” Newsom called the rise in unemployment claims “Without precedent in our state’s history,” noting that 4.2 million people have now applied for Public Unemployment Assistance and $10.6 billion in aid has already been distributed.


He also announced his signing an executive order extending worker’s compensation to essential workers who test positive for COVID-19, adding that benefits could only be rebutted by an employer “under strict criteria.” Newsom is facing mounting criticism over a plan he announced on April 16 that would create a $125 million fund for undocumented immigrants affected by the coronavirus. Non-profits will distribute the money, but it’s still unclear when people will see a check.

Read more …

Link on the page to another Giurdian article: Q&A – Coronavirus tests in the UK – who qualifies for one?

That would have been a reasonable question in January, perhaps into February. It’s idiotic in May.

UK GPs In The Dark Over COVID19 Tests (G.)

The results of hundreds of thousands of coronavirus tests carried out at privately run drive-through centres in England have not yet been shared with GPs or local authorities, who complain they have “no idea” where local disease clusters are. GPs told the Guardian they had been “totally left out of the conversation” after the government said it was still “working on a technical solution” to get Covid-19 test results into individual GP records in England, having promised to do so weeks ago. Meanwhile, the chief medical officer for England, Prof Chris Whitty, apologised to local health leaders who have not yet received any detailed data from “pillar two” tests conducted by the private firm Deloitte over the past month.


These now form the majority of tests being carried out each day, either at drive-through testing centres or via the post. During a conference call on Wednesday with directors of public health at local authorities across England, the government’s national coordinator of the UK coronavirus testing programme, Prof John Newton, also apologised for not yet sharing the detailed data. He said there had been “data quality issues”. Newton admitted that the Deloitte tests did not yet ask people for their ethnicity or whether they worked in health or social care – an oversight described by one director of public health on the call as “really disappointing”. People of colour and healthcare workers and those working in care homes are known to have much higher incidences of the disease.

Read more …

• UK unemployment to double and economy to shrink by 25%, warns Bank of England

• British economic output is set to crash 14% this year owing to the coronavirus, the Bank of England said as it left its interest rate at 0.1%.

• UK gross domestic product would rebound by 15% in 2021 however, the BoE said

• Buy some more gowns, unseen preferably

All 400,000 Gowns Flown From Turkey For NHS Fail UK Standards (G.)

Last month, amid dire warnings of shortages of personal protective equipment for health workers, ministers publicised the imminent arrival from Turkey of a fleet of RAF cargo planes bringing in a “very significant” shipment of PPE for the NHS. More than a fortnight later, it has emerged that every one of the 400,000 protective gowns that eventually arrived has been impounded after being found not to conform to UK standards. The Department for Health and Social Care confirmed on Wednesday evening that the items were being held in a facility near Heathrow airport. It is understood that they are due to be sent back and that the DHSC intends to seek a refund, as it has done in similar situations in the past.

The announcement of the shipment by the communities secretary, Robert Jenrick, on 18 April came as unions and professional bodies warned that NHS staff may refuse to work without PPE. Jenrick told the daily Downing Street press briefing that healthcare workers should be “assured that we are doing everything we can to correct this issue”, saying they would have the equipment they “need and deserve”. Sources later told the Guardian that the DHSC had advised No 10 not to allow Jenrick to publicise the shipment in case it backfired, but was overruled. The necessary clearances, it turned out, had not been sought. When the consignment did not arrive on time as promised, the delay prompted hospital leaders to directly attack the government for the first time during the pandemic.

Ministers responded by saying they thought it may only a one-day delay. Two days later, with the shipment only then beginning to clear Turkish customs checks, they were only able to give an estimate of arrival “in the next few days”. The first planeload of gowns eventually arrived on 22 April, but the next day it was reported that “less than a 10th” of the order had arrived. Now all are expected to be returned. The saga, first reported by the Telegraph, is one of a series of highly publicised government coronavirus initiatives that have failed to deliver the promised results. Its much-trumpeted “ventilator challenge” asked companies such as Rolls-Royce and Dyson to begin producing the machines, but none have reached the final stages of testing and the majority have proved surplus to requirements.

Read more …

David Spiegelhalter was quoted by the PM yesterday to prove Britain can’t be compared to opther countries, and didn’t like that. He tweeted: “Polite request to PM and others: please stop using my Guardian article to claim we cannot make any international comparisons yet. I refer only to detailed league tables-of course we should now use other countries to try and learn why our numbers are high..”

BTW, Spiegelhalter translate as “someone who holds (up) a mirror”. Fitting.

COVID19 Deaths: How Does Britain Compare With Other Countries? (Spiegelhalter)

You would think it would be easy for a bean-counting statistician to count deaths – the one certain thing (apart from taxes). But it is remarkably difficult. I have stopped taking much notice of the number given out at the daily press conferences, as it is only based on reports from hospitals, oscillates wildly around weekends, and recently included deaths that occurred a month ago. And this week the number of UK deaths jumped up by nearly 5,000 to 26,097 in one day – rather close to Starmer’s count – by retrospectively including non-hospital deaths that had tested positive for the virus. But even this is too low, as it does not include the many deaths of people who were not tested.

The Office for National Statistics data on death registrations is the last word, although inevitably delayed by around 10 days, and these figures would be expected to take the current total to significantly more than 30,000. But we should be very cautious in comparing even this uncertain total with those of other countries. Every country has different ways of recording Covid-19 deaths: the large number of deaths in care homes have not featured in Spain’s statistics – which, like the UK’s require a positive test result. The numbers may be useful for looking at trends, but they are not reliable indicators for comparing the absolute levels. If we were naive enough to take the counts at face value, the new figures propelled the UK past France and Spain into second place in Europe behind Italy, which is not encouraging because we are behind Italy in terms of what stage of the epidemic we are at.

A more equitable metric might be Covid-19 deaths per million. Ignoring tiny countries, our current score of 388 puts us fourth, behind Belgium (632), Spain (509) and Italy (452). But these are still deeply unreliable numbers, as it is not clear if we should just be looking at Covid-19-labelled deaths anyway. The effects of seasonal flu are not based on tests or death certificates, but at looking at the total number of deaths over the winter, seeing how many extra there are than a baseline, allowing for climate, and assuming these excess deaths were linked to flu. On average, over the last 10 years this has come to about 8,000 flu-related deaths, rising to 26,400 in 2017-2018 and 28,300 in 2014-15.

Read more …

Being an island helps. And so does a real lockdown.

New Zealand ‘Halfway Down Everest’, Plans Big Easing Of COVID Lockdown (G.)

Hairdressers, bars and competitive sport could be back on the agenda for New Zealanders from next week as the prime minister, Jacinda Ardern, said the country was “halfway down Everest” in its fight against Covid-19. New Zealand has been under strict lockdown restrictions for more than five weeks, but the low number of cases this week – zero for two consecutive days – means restrictions will soon be lifted. Ardern and her cabinet will make a decision on downgrading the country’s alert level from three to two on Monday, and by Wednesday, life could begin to look much more normal – and fun – for millions of cooped-up Kiwis. The relaxation of restrictions, which would allow gatherings of up to 100 people, both indoors and outdoors, was greeted with jubilation across the country.

Public spaces such as playgrounds and libraries would be reopened, bars and restaurants would be able to accept patrons, and domestic travel and competitive sport allowed to resume, including the professional leagues, but there will be no stadium crowds for now. Most workers would be allowed to head back to the office, though Ardern urged any who could stay home – or found it more productive – to do so. Widespread social-distancing rules would continue to apply, including patrons being seated two metres apart in public spaces, strangers keeping their distance from one another, and hairdressers, barbers and beauticians being required to wear PPE.

New Zealanders have been living in tight “bubbles” for more than a month, only allowed to socialise with those in their own home. Under the plans outlined by Ardern on Thursday, they would be permitted to see friends, family and even online dates – so long as they keep a log of their movements, and did not participate in indoor or outdoor gatherings of any more than 100. Weddings, funerals and anniversary celebrations would also be permitted. [..] the measures appear to have been effective, with just 21 deaths – all older people with pre-existing health conditions – and global praise has been heaped on the small island nation of 5 million by the World Health Organization, among others.

Read more …

Eastern Europe is a success story.

Baltic States To Create ‘Travel Bubble’ As Pandemic Curbs Eased

Latvia, Lithuania and Estonia will open their borders to each others’ citizens from May 15, creating a Baltic “travel bubble” within the European Union amid an easing of pandemic restrictions, their prime ministers said on Wednesday. “It’s a big step towards life as normal”, Estonian Prime Minister Juri Ratas wrote on Twitter. The Baltic travel area would be first of its kind in the bloc, where most countries restricted entry to non-nationals and imposed quarantine on incoming travellers as the coronavirus spread across the continent. Citizens of the three countries will be free to travel within the region, but anyone entering from outside will need to self-isolate for 14 days, Lithuanian Prime Minister Saulius Skvernelis said.


“We showed a good example by stating, very clearly, that only countries which successfully dealt with the situation can open themselves up,” he added. “I think we will keep to this principle when dealing with countries where the situation is very bad, which did not take measures to control the virus spread.” Poland and Finland could be the next countries to join the free travel bloc, said Skvernelis. The European Commission has recommended that internal border controls between all member states should be lifted in a coordinated manner, once their virus situation converges sufficiently, the commission’s office in Lithuania said.

Read more …

No buyers left.

China’s Services Sector Contracts For Third Month As Job Losses Hit Record (R.)

China’s services firms wallowed in contraction in April as layoffs hit a record and export orders plunged after signs of improvement in March, a private survey showed, dashing hopes of a quick recovery from the coronavirus blow. The Caixin/Markit services Purchasing Managers’ Index (PMI) did manage to pull up to 44.4 in April from 43 in March, but remained in a deep slump and far below historic averages. The 50-mark separates growth from contraction on a monthly basis. The third straight month of contraction for China’s services sector, an important generator of jobs and which accounts for about 60% of the economy, suggests a still turbulent period ahead after the collapse in economic activity in the first quarter, when GDP shrank 6.8%.


It also raised worries about the outlook even though the pandemic has been largely brought under control domestically, as a sharp global downturn dampens demand for Chinese goods and services. “The second shockwave for China’s economy brought about by shrinking overseas demand should not be underestimated in the second quarter,” said Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group. Major economies, including the United States and Europe, remain in the grip of the pandemic amid rapidly rising infections and deaths. The sweeping impact of the coronavirus, with the global death toll at well over 250,000, has many worried that a worldwide recession could be far more damaging than first thought. In April, new export orders shrank further after their pace of contraction slowed in March, declining at the second-fastest rate on record, just marginally better than February’s collapse.

Read more …

You mean, you don’t do such reviews normally? High time then. Still, “..a task force to assess how well multilateral institutions carry out their missions and serve American interests.” sounds nuts. They’re supposed to serve global interests. If not, they would start serving US interests at the cost of other countries. Oh wait…

Republicans Want Review Of Aid To WHO (R.)

Five U.S. Senate Republicans introduced a bill on Wednesday seeking a review of U.S. participation in the World Health Organization and other international institutions, after President Donald Trump’s administration suspended U.S. contributions to the U.N. health agency and accused it of mishandling the coronavirus pandemic. Introduced by Chairman Jim Risch and four other Republican members of the Senate Foreign Relations Committee, the “Multilateral Aid Review Act of 2020” would establish a task force to assess how well multilateral institutions carry out their missions and serve American interests.

The bill requires a report on 38 institutions. Besides the WHO, they include the World Bank; Asian, African, Inter-American and North American Development Banks, and European Bank for Reconstruction and Development, as well as the Global Fund to Fight AIDS, Tuberculosis and Malaria, several U.N. organizations and the International Committee of the Red Cross. Trump suspended U.S. contributions to the WHO on April 14, accusing it of promoting China’s “disinformation” about the coronavirus outbreak and saying his administration would launch a review of the organization. WHO officials have denied the claims and China insists it has been transparent and open. The United States is the WHO’s biggest donor.

“As we have seen most recently with questionable actions taken by the World Health Organization in response to the spread of COVID-19, it is critically important to have accountability and oversight of our assistance,” Risch said in a statement announcing the bill. [..] Critics of the aid review bill said they were concerned the task force would be too partisan because Pompeo would be its chairman and members would be appointed by Trump.

Read more …

Why are we still discussing the OPCW? Why does it still exist? They’re a bunch of liars who were found out.

OPCW Chief Made False Claims To Denigrate Douma Whistleblower (Maté)

The Organization for the Prohibition of Chemical Weapons has made false and misleading statements about two veteran inspectors who challenged a cover-up of their investigation in Syria, leaked documents show. The inspectors probed an alleged chemical weapons attack in the Syrian city of Douma in April 2018, and later objected when their evidence was suppressed. Documents obtained by The Grayzone reveal that OPCW leaders have engaged in a pattern of deception that minimized the inspectors’ senior roles in the Douma mission and diminished the prestige they enjoyed within the world’s top chemical weapons watchdog.

OPCW Director General Fernando Arias has claimed that the first inspector, South African chemical engineering and ballistics expert Ian Henderson, “was not a member” of the Douma investigative team and only played a “minor supporting role.” However, contemporaneous communications from the OPCW’s Douma Fact-Finding Mission (FFM) directly contradict Arias. They show that Henderson was indeed a Douma team member, and that OPCW leadership directed him to lead its most critical inspections. They also show that Arias, rather than acknowledge that Henderson was an FFM member, offered up a false explanation for why Henderson was in Syria at the time of the probe.

Arias has also disingenuously minimized the role of the second inspector, known only to the public as “Inspector B.” This will be examined in part two of this article. The OPCW’s investigation was triggered when extremist anti-Syrian government militants and Western states accused the Syrian army of dropping gas cylinders on two buildings in Douma, killing dozens of civilians. The U.S., France, and Britain bombed Syrian government targets days later, asserting their right to enforce the chemical weapons “red line.” After a nearly year-long investigation, the OPCW issued a final report in March 2019 that claimed “reasonable grounds” existed to believe that a chlorine attack occurred.

However, a trove of leaked documents has shown that the OPCW leadership suppressed and manipulated evidence that undermined the allegation against the Syrian military. The first of such leaks was an engineering assessment authored by Henderson that concluded that the gas cylinders in Douma were likely “manually placed.” That conclusion suggested the incident was staged on the ground by the armed militants who controlled Douma at the time. Additional leaks later revealed that Inspector B protested the censorship of critical evidence and toxicology reports, as well as the manipulation of chemical samples and witness statements. Henderson and B also complained that OPCW leaders excluded all of the Douma investigators except for one paramedic from a so-called “core” team that wrote the organization’s final report.

Read more …

In case you needed any confirmation that Andrew Cuomo is not exactly your hero.

As for Bill Gates, he’s just a fool with too much money, and should be kept far from schools. We don’t need another generation using his crappy software.

I had a text talk with a friend in Greece Tuesday, who tried to convince me that Bill Gates wanted to force-vaccinate everyone and force implant them with nano-chips to prove vaccination. I think maybe because of the language barrier he may not have grasped the nuances whenn I said: “You have nothing to worry about then, because there is no vaccine”.

Someone else sent me a video from the Alex Jones studios that claimed Bill Gates is the mastermind behind a grand secret global conspiracy to depopulate the planet -hence COVID19-. I’m sorry, but I cannot post that here.

Cuomo Taps Bill Gates To Help Him ‘Reimagine’ New York’s Public Schools (JTN)

Gov. Andrew Cuomo announced a partnership with the Bill and Melinda Gates Foundation to “reimagine” schools when they reopen after the coronavirus pandemic. “Bill Gates is a visionary in many ways, and his ideas and thoughts on technology and education he’s spoken about for years,” Cuomo said Tuesday. “But I think we now have a moment in history where we can actually incorporate and advance those ideas. Cuomo said the state is exploring the possibility that K-12 schools will utilize distancing learning in the future and wondered aloud if the “old model” of in-person learning was obsolete.

He said Gates would help evaluate possible changes to the education system, including providing more opportunities to students, using technology to reduce educational inequality, and recreating larger class or lecture hall environments with virtual classrooms. The Gates Foundation has experimented with education before with some mixed results. Business Insider reports that Gates spent $1 billion and seven years working on an initiative to improve test performance for students in low-income schools by closely monitoring teacher effectiveness. The program reportedly didn’t improve test scores or drop-out rates in the long-term, and even “did more harm than good.”

The Gothamist reports at least five organizations have already spoken out against the partnership, citing concerns about the Microsoft founder’s support of standardized testing and Common Core curriculum. Allies for Public Education, Class Size Matters, and the Parent Coalition for Student Privacy — have already written to Cuomo and state education officials to voice their objections. “We were appalled to hear that you will be working with the Gates Foundation on ‘reimagining’ our schools following the Covid crisis,” the coalition wrote. “Bill Gates and the Gates Foundation have promoted one failed educational initiative after another, causing huge disaffection in districts throughout the state.

Read more …

 

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Apr 022020
 


William Henry Jackson Camp wagon on a Texas roundup 1901

 

More Than 1,000 New York City Police Officers Have The Coronavirus (CNBC)
Of 125,000 NHS Staff Self-Isolating, Still Just 2,000 Were Tested (Ind.)
Chinese Smartphone Health Code Rules Post-Virus Life (AP)
More Than 1.7 Million Britons May Have Contracted COVID19 – NHS |(Ind.)
Pelosi Wants ‘Vote By Mail’ Provisions In Next US Coronavirus Bill (R.)
Key Medical Supplies Were Shipped From US Manufacturers To Foreign Buyers (IC)
$2 Trillion CARES Act A Lifeline For Gig Workers And Freelancers (CNBC)
US Banks To Make Billions On Small Business Bailout (ZH)
Top US Banks May Shun Small-Business Rescue Plan On Liability Worries (R.)
US Military Knew Years Ago That a Coronavirus Was Coming (Nation)
Privatization, National Security State Left Americans Defenseless (GZ)
Biden’s False Claim on Trump’s Response to Coronavirus (FactCheck)
Chinese Scientists Seeking COVID19 Treatment Find ‘Effective’ Antibodies (R.)
Texas Pastors Demand “Religious Liberty” Exemption To Stay-at-home Orders (Vox)
Chomsky: Ventilator Shortage Exposes the Cruelty of Neoliberal Capitalism (TO)
Israeli Doctors Demand Health Minister Be Replaced By Professional (YNet)
All Roads Lead To Dark Winter (Whitney Webb & Raul Diego)

 

 

It’s blame game time. We have plenty theories to keep you occupied with while sitting at home. I’m surprised at how many people can’t seem to face the day without such a theory. Which is fine, but at least come with evidence.

In other news: We’ll pass 1 million cases today.

 

 

Cases 950,425 (+ 77,548 from yesterday’s 872,777)

Deaths 48,276 (+ 5,005 from yesterday’s 43,271)

 

 

 

From Worldometer yesterday evening -before their day’s close-.

 

 

From Worldometer -NOTE: mortality rate for closed cases is at 19% –

 

 

From SCMP:

 

 

From COVID2019Live.info:

 

 

 

 

I guess NYC thinks their heroes are all Marvel characters who A) don’t die and B) come in droves

More Than 1,000 New York City Police Officers Have The Coronavirus (CNBC)

More than 1,000 New York City police officers have contracted COVID-19 as emergency calls in the city hit record highs. Of the New York Police Department’s more than 36,000 employees 1,048 officers and 145 civilian employees have tested positive for COVID-19 as of Tuesday, NYPD said in a statement. The department added that 5,657 uniformed officers, or more than 15% of the force, called out sick on Tuesday. “I am worried about essential workers getting scared and not wanting to show up,” New York Gov. Andrew Cuomo said Tuesday. “That I am worried about. You know the number of police officers who are getting sick is going up.”

Officials from the Fire Department of New York told NBC News on Tuesday that 282 members, including firefighters, EMTs and civilians, have tested positive for COVID-19. At the same time, 911 call volume is hitting record daily highs, the Fire Department said. There were 6,527 medical calls to 911 placed on Monday, and over the past few days the FDNY has had to “hold” hundreds of calls, according to NBC News. This means that lower priority sick calls have to wait for ambulances. COVID-19 has infected 43,119 people in New York City and killed at least 1,096 people, according to data compiled by Johns Hopkins University.

Last month, the New York City Police Benevolent Association, or PBA, filed a complaint with the New York State Public Employee Safety and Health Bureau demanding NYPD provide adequate protective equipment, including masks and gloves, to all police officers. “No matter how this pandemic progresses, New York City police officers will remain on the front lines and will continue to carry out our duties protecting New Yorkers,” PBA President Patrick Lynch said in a statement. “The NYPD has not done enough to ensure that all of our members have protective equipment such as masks and gloves, nor does it have adequate supplies of that equipment to weather a prolonged outbreak.”

Read more …

Britain has the same issue: They’re our heroes, so we don’t test them.

Of 125,000 NHS Staff Self-Isolating, Still Just 2,000 Were Tested (Ind.)

Just 2,000 NHS frontline staff forced to stay home due to coronavirus have been tested to see if they can return to work, Downing Street has admitted. The figure – a tiny fraction of the 125,000 staff believed to be self isolating – emerged as the government faced mounting criticism for its failure to move to mass testing for Covid-19. Public Health England medical director Yvonne Doyle told a Downing Street press conference that officials hoped hundreds of thousands of staff would be tested “within the coming weeks”. But ministers were unable to give clear answers on how quickly they can ramp up antigen tests, which show whether someone has the disease. They were also unclear over the question of when the UK will see the introduction of antibody tests, which indicate if an individual has been infected and recovered.


Industry figures and scientists questioned ministers’ claims that a lack of chemicals and swabs is to blame for the UK lagging behind Germany, where as many as 70,000 are being tested every day. Unions issued a joint demand for personal protective equipment (PPE) for all frontline health and social care staff, warning that the lack of kit was “a crisis within a crisis”. And there were demands for testing to be extended to all care home staff, with one MP claiming there has been rationing of antigen tests. The UK’s death toll from the pandemic has now reached 2,352 after 563 patients who had tested positive died in hospital in one day. Among them weas 13-year-old Ismail Mohamed Abdulwahab, who reportedly died alone and without his family as he became the youngest victim in England.

Read more …

Told you the virus is a timemachine. Here’s another look at your future.

Chinese Smartphone Health Code Rules Post-Virus Life (AP)

Since the coronavirus outbreak, life in China is ruled by a green symbol on a smartphone screen. Green is the “health code” that says a user is symptom-free and it’s required to board a subway, check into a hotel or just enter Wuhan, the central city of 11 million people where the pandemic began in December. The system is made possible by the Chinese public’s almost universal adoption of smartphones and the ruling Communist Party’s embrace of “Big Data” to extend its surveillance and control over society. Walking into a Wuhan subway station Wednesday, Wu Shenghong, a manager for a clothing manufacturer, used her smartphone to scan a barcode on a poster that triggered her health code app.


A green code and part of her identity card number appeared on the screen. A guard wearing a mask and goggles waved her through. If the code had been red, that would tell the guard that Wu was confirmed to be infected or had a fever or other symptoms and was awaiting a diagnosis. A yellow code would mean she had contact with an infected person but hadn’t finished a two-week quarantine, meaning she should be in a hospital or quarantined at home. Wu, who was on her way to see retailers after returning to work this week, said the system has helped reassure her after a two-month shutdown left the streets of Wuhan empty. People with red or yellow codes “are definitely not running around outside,” said Wu, 51. “I feel safe.”


AP Photo/Olivia Zhang

Read more …

Well, could be ten times that, but we’ll levae that for next week.

More Than 1.7 Million Britons May Have Contracted COVID19 – NHS |(Ind.)

More than 1.7 million people may have contracted Covid-19 so far, according to the NHS. New figures from NHS 111 online show there were 1,496,651 web-based assessments which flagged potential coronavirus cases based on people’s symptoms between 18 March and 31 March. A further 243,543 assessments via the NHS 111 and 999 phone lines also concluded people had possibly contracted the disease. But the assessment numbers do not necessarily relate to individual people, the NHS said, as it is possible people have sought help more than once or through various channels. The data, published by NHS Digital, comes after GP practices in England were told to open over the Easter Bank Holiday to help the NHS cope with coronavirus.

Read more …

1) how do you make it safe health-wise?
2) how do you make it hack-wise?
3) why on earth does it have to cost $4 billion?

Pelosi Wants ‘Vote By Mail’ Provisions In Next US Coronavirus Bill (R.)

U.S. House Speaker Nancy Pelosi said on Wednesday she wants to virus-proof the November election by including funding to boost voting by mail in the next pandemic response plan being put together by Democrats in the House of Representatives. Pelosi said at least $2 billion, and ideally $4 billion, was needed to enable voting by mail, to give citizens a safe way to vote during the coronavirus pandemic, which has killed more than 4,300 people across the United States. She noted Democrats got just $400 million for that purpose in the $2.3 trillion coronavirus stimulus bill President Donald Trump signed into law on Friday.

“Vote by mail is so important to … our democracy so that people have access to voting and not be deterred, especially at this time, by the admonition to stay home,” Pelosi told reporters. Trump told Fox News on Monday that voting by mail would hurt the Republican Party. Pelosi rejected that argument. “When I was chair of the California Democratic party many years ago, the Republicans always prevailed in the absentee ballots,” she said. “They know how to do this.” Indeed, some Democrats fear voting by mail could disenfranchise minorities and low-income voters who tend to move more frequently. The $400 million in the recent coronavirus bill is intended to help state and local officials bolster vote by mail and early voting, expand facilities and hire more poll workers.

[..] Three states – Wyoming, Hawaii and Alaska – have scrapped in-person voting for Democratic primaries on April 4, and will only permit voting by mail. Ohio pushed back its March 17 voting, setting a new date of April 28 for a primary conducted almost completely by mail, and at least eight other states pushed their primaries back to May or June.

Read more …

Where was the CDC?

Key Medical Supplies Were Shipped From US Manufacturers To Foreign Buyers (IC)

While much of the world moved swiftly to lock down crucial medical supplies used to treat the coronavirus, the U.S. dithered, maintaining business as normal and allowing large shipments of American-made respirators and ventilators to be sold to foreign buyers. The foreign shipments, detailed in dozens of government records, show exports to other hot spots where the pandemic has spread, including East Asia and Europe. American hospitals around the country are now running low on all forms of personal protective gear, such as N95 masks or purified air personal respirators, for medical staff, as well as life-saving ventilators, which pump oxygenated air into the lungs, for patients.

[..] Drive DeVilbiss Healthcare, a Pennsylvania-based health product firm that produces supplemental oxygen machines, sent at least three different shipments of respiratory equipment to Belgium in mid-February and early March. The total cargo included 14 containers weighing more than 55 tons. DeVilbiss and its owner, Clayton Dubilier & Rice, a New York-based private equity firm, did not respond to a request for comment. Pennsylvania Gov. Tom Wolf reportedly reached out to DeVilbiss later in March to support the company’s increased production of respiratory medical devices. “Our demand is unprecedented,” Tim Walsh, the company’s vice president, told WJAC, a local news station.

Vapotherm, a New Hampshire firm that produces respiratory equipment, has faced surging demand from international customers. The company has added 50 employees and a second shift to meet growing demand for its products. WMUR, a local news station, profiled Vapotherm’s role in producing lifesaving respiratory equipment used to treat the coronavirus. During the segment, Joseph Army, the chief executive of Vapotherm, told the station that he first heard from customers in Europe and Asia in response to the coronavirus. A camera shot of Vapotherm’s factory showed a box labeled “Japan.” The demand, he added, has shifted in recent weeks to domestic contracts for clients in Seattle, New York City, Georgia, and Florida.

Read more …

You mean something went right? I’d still like to see proof.

$2 Trillion CARES Act A Lifeline For Gig Workers And Freelancers (CNBC)

The $2 trillion federal stimulus package signed into law by President Donald Trump on Friday, March 27, will be a lifeline to many gig workers and freelancers. Known as the CARES Act, the law takes unprecedented steps in including the self-employed in the social safety net. It offers freelancers unemployment insurance, for which they generally don’t qualify, on a large scale for the first time. As stipulated in the House bill, it offers freelancers an additional $600 a week in unemployment insurance, bringing weekly payouts to the $800- to $900-a-week range when state benefits are added, to workers including the self-employed, for up to four months.

“It’s an amazing win, given that there is no unemployment insurance for freelancers,” says Rafael Espinal, who recently took the helm of the Freelancers Union as executive director. “This will help inject cash flow into their homes.” The stimulus package also offers the self-employed and small business owners a $10,000 advance on an Emergency Economic Injury Disaster Loan (EIDL) that does not have to be paid back, even if the borrower does not qualify for an SBA loan. The program provides loans up to $200,000.

Sole proprietors, ESOPs, cooperatives, businesses with no more than 500 employees and tribal small business concerns can apply. Under the EIDL program, administered by the U.S. Small Business Administration, applicants will not have to submit a tax return and will be evaluated based on their credit score. The SBA will provide the funding within three days of a successfully completed application as an advance payment. There is no personal guarantee required for the loans. The SBA is waiving the requirement that businesses have one year of operations prior to the disaster, but businesses are not eligible if they were not in operation on January 1, 2020. The bill authorizes $10 billion in appropriations for these loans.

Read more …

Color me amazed.

US Banks To Make Billions On Small Business Bailout (ZH)

As part of the $2 trillion fiscal stimulus package that was signed into law by Donald Trump on Friday, the Small Business Administration will offer $350 billion in loans to US small businesses meant to preserve business solvency as part of the emergency federal response to the coronavirus pandemic; the loans, part of the so-called “Paycheck Protection Program” will be offered through banks and credit unions to cash-strapped businesses employing under 500 people (it’s not clear how a company employing 500 people is a “small business” but we can assume that this is just a stealthy bailout of some not so small businesses).

To be sure, the terms of the loans are generous: the full amount of the loan will be forgiven if it is used for payroll, mortgage interest, rent or utilities in the two months after the money is received. Less will be forgiven if the employees are sacked or salaries cut. Any amount that is not forgiven will accrue interest at just 0.5% rate and the principal will come due in two years. Borrowers will need to fill out a two-page form and document that they were in business as of mid-February. Lenders will not need to wait for SBA confirmation before providing cash in hand, as soon as Friday. Businesses will be eligible to borrow the equivalent of 2.5 times their average monthly payroll with a cap of $10mm.

According to the SBA, there are 30m businesses with fewer than 500 employees in the US, employing 60m people, almost half of the private workforce. The National Federation of Independent Business, an advocacy group, says about three-quarters of its members have been affected by the crisis. Yet some may be “shocked” to learn that like in any government bailout package, the biggest winners here will not be America’s vibrant small and medium business sector, which at best will get the bare minimum cash to fund 2.5 months of payroll (this assume the pandemic will be resolved by mid-June) but – drumroll – America’s banks.

As the FT reports overnight, banks stand to make billions by overseeing the distribution of these loans as they receive processing fees, paid by the federal government, for making the loans. The fees will vary with loan size: 5% for loans under $350,000, 3% for loans under $2MM, and 1% for loans greater than $2MM. The loans will not incur a capital charge. This means that banks stand to earn as much as $17.5 billion – and $10 billion if one assumes an average rate of 3% – for doing something the government is incapable of doing: handing out hundreds of billions in loans/grants to America’s businesses in the shortest possible time.

Read more …

Oh wait, the banks don’t need those billions.

Top US Banks May Shun Small-Business Rescue Plan On Liability Worries (R.)

Top U.S. banks have threatened to give the federal government’s small-business rescue program a miss on concerns about taking on too much financial and legal risk, five people with direct knowledge of industry discussions told Reuters. Seeking to help millions of small businesses whose operations have either shut down or have been dramatically curtailed by the coronavirus pandemic, Congress last week passed a $2 trillion stimulus package that includes $349 billion aimed at small firms. Borrowers can apply for the loans through participating banks starting from Friday and until June 30. Trump administration officials have said they want the loans disbursed within days. But representatives of some big lenders, in an industry conference call on Wednesday, expressed serious reservations about participating in the scheme in its current form.


Their main concern is that the Treasury Department has said it expects lenders to verify borrower eligibility, and take steps to prevent fraud, money laundering and protect customer information under the Bank Secrecy Act, sources said. Banks are worried they could face regulatory penalties or legal costs down the line if things go awry in the haste to get money out the door, or get blamed for not moving funds fast enough if they perform due diligence the way they would in ordinary times, the sources said. After hearing the concerns, Treasury officials are considering withdrawing guidance that instructed lenders to verify borrowers had the specified number of employees on their books, and that their other costs are legitimate, according to two sources.

Read more …

So where were they? Note: eevrybody knnew it was coming. Just not the timing.

US Military Knew Years Ago That a Coronavirus Was Coming (Nation)

Despite President Trump’s repeated assertions that the Covid-19 epidemic was “unforeseen” and “came out of nowhere,” the Pentagon was well aware of not just the threat of a novel influenza, but even anticipated the consequent scarcity of ventilators, face masks, and hospital beds, according to a 2017 Pentagon plan obtained by The Nation. “The most likely and significant threat is a novel respiratory disease, particularly a novel influenza disease,” the military plan states. Covid-19 is a respiratory disease caused by the novel (meaning new to humans) coronavirus. The document specifically references coronavirus on several occasions, in one instant saying, “Coronavirus infections [are] common around the world.”

The plan represents an update to an earlier Department of Defense pandemic influenza response plan, noting that it “incorporates insights from several recent outbreaks including…2012 Middle Eastern Respiratory Syndrome Coronavirus.” Titled “USNORTHCOM Branch Plan 3560: Pandemic Influenza and Infectious Disease Response,” the draft plan is marked for official use only and dated January 6, 2017. The plan was provided to The Nation by a Pentagon official who requested anonymity to avoid professional reprisal. Denis Kaufman, who served as head of the Infectious Diseases and Countermeasures Division at the Defense Intelligence Agency from 2014 to 2017, stressed that US intelligence had been well-aware of the dangers of coronaviruses for years. (Kaufman retired from his decades-long career in the military in December of 2017.)

“The Intelligence Community has warned about the threat from highly pathogenic influenza viruses for two decades at least. They have warned about coronaviruses for at least five years,” Kaufman explained in an interview. “There have been recent pronouncements that the coronavirus pandemic represents an intelligence failure…. it’s letting people who ignored intelligence warnings off the hook.” In addition to anticipating the coronavirus pandemic, the military plan predicted with uncanny accuracy many of the medical supply shortages that it now appears will soon cause untold deaths. The plan states: “Competition for, and scarcity of resources will include…non-pharmaceutical MCM [Medical Countermeasures] (e.g., ventilators, devices, personal protective equipment such as face masks and gloves), medical equipment, and logistical support. This will have a significant impact on the availability of the global workforce.”

Read more …

First we dump on Trump, and only then do we say what is really goinng wrog.

Privatization, National Security State Left Americans Defenseless (GZ)

Donald Trump’s failure to act decisively to control the coronavirus pandemic has likely made the Covid-19 pandemic far more lethal than it should have been. But the reasons behind failure to get protective and life-saving equipment like masks and ventilators into the hands of health workers and hospitals run deeper than Trump’s self-centered recklessness. Both the Obama and Trump administrations quietly delegated state and local authorities with the essential national security responsibility for obtaining and distributing these vital items. The failure of leadership was compounded the lack of any federal power center that embraced the idea that guarding for a pandemic was at least as important to national security as preparing for war.

For decades, the military-industrial-congressional complex has force-fed the American public a warped conception of US national security focused entirely around perpetuating warfare. The cynical conflation of national security with waging war on designated enemies around the globe effectively stifled public awareness of the clear and present danger posed to its survival by global pandemic. As a result, Congress was simply not called upon to fund the vitally important equipment that doctors and nurses needed for the Covid-19 crisis. At the heart of the growing coronavirus crisis in the US is a severe shortage of N95 respirators and ventilators. Those items should have been available in sufficient numbers through the Strategic National Stockpile (SNS), which holds the nation’s largest supplies necessary for national emergencies.

But the stocks of crucial medical have not been maintained for years, largely because Congress has not provided the necessary funding. Congress has been willing to dole out load of cash after pandemics hit the US. When the H1N1 flu crisis hit the United States in 2009, and close to 300,000 Americans were hospitalized, Congress appropriated $7.7 billion in special funding, including support for building up the SNS. That allowed the stockpile to provide 85 million respirators and millions of ventilators to hospitals around the country, especially during the second half of the yearlong crisis. But since that 2009-10 crisis ended, the stockpile of such vital equipment has never been replenished.

In 2020 the stockpile holds only 12 million N95 respirators – as little as 1 percent of what is now needed by health workers – and just 16,000 ventilators, compared with the estimated 750,000 people at minimum who will need a ventilator because of the Covid-19 pandemic. These numbers are so scandalously low in relation to what is needed that senior officials Department of Health and Human Services have refused to reveal publicly how many they have in stock.

Read more …

Especially in times of stress, the world is an easier place if it is in black and white.

Biden’s False Claim on Trump’s Response to Coronavirus (FactCheck)

Former Vice President Joe Biden was wrong when he said that the Trump administration made no effort to get U.S. medical experts into China as the novel coronavirus epidemic spread there early this year. “[W]hen we were talking … early on in this crisis, we said — I said, among others, that, you know, you should get into China, get our experts there, we have the best in the world, get them in so we know what’s actually happening,” Biden, the front-runner for the Democratic presidential nomination, said at a CNN virtual town hall on March 27. “There was no effort to do that.” Except that isn’t the case. The U.S. Centers for Disease Control and Prevention tried to get into China just one week after China reported the outbreak to the World Health Organization on Dec. 31, 2019.

“On January 6, we offered to send a CDC team to China that could assist with these public health efforts,” Health and Human Services Secretary Alex Azar said at a Jan. 28 press conference. “I reiterated that offer when I spoke to China’s Minister of Health on Monday, and it was reiterated again via the World Health Organization today. We are urging China: More cooperation and transparency are the most important steps you can take toward a more effective response.” More than a week later, Azar said again at a Feb. 7 press conference that “our longstanding offer to send world-class experts to China to assist remains on the table.” At the time, the New York Times reported, “Normally, teams from the agency’s Epidemic Intelligence Service can be in the air within 24 hours.”

A team of public health experts from the WHO was allowed by Chinese authorities to visit Wuhan, where the outbreak began, later in February, according to the South China Morning Post. The team included specialists from the United States as well as Germany, Russia, Japan, Singapore, South Korea and Nigeria. Biden was correct at the town hall when he said the Trump administration had eliminated a position set up by the Obama administration, in which Biden served, to coordinate the response to pandemics like the coronavirus crisis. But he got the timing wrong, and Trump administration officials say it was a reorganization, with the responsibilities of that office falling to other individuals.

Read more …

I was wondering yesterday what happened to all of the earlier stories about cures and vaccines. None seem to have aged well..

Chinese Scientists Seeking COVID19 Treatment Find ‘Effective’ Antibodies (R.)

A team of Chinese scientists has isolated several antibodies that it says are “extremely effective” at blocking the ability of the new coronavirus to enter cells, which eventually could be helpful in treating or preventing COVID-19. There is currently no proven effective treatment for the disease, which originated in China and is spreading across the world in a pandemic that has infected more than 850,000 and killed 42,000. Zhang Linqi at Tsinghua University in Beijing said a drug made with antibodies like the ones his team have found could be used more effectively than the current approaches, including what he called “borderline” treatment such as plasma. Plasma contains antibodies but is restricted by blood type.


In early January, Zhang’s team and a group at the 3rd People’s Hospital in Shenzhen began analysing antibodies from blood taken from recovered COVID-19 patients, isolating 206 monoclonal antibodies which showed what he described as a “strong” ability to bind with the virus’ proteins. Among the first 20 or so antibodies tested, four were able to block viral entry and of those, two were “exceedingly good” at doing so, Zhang said. They then conducted another test to see if they could actually prevent the virus from entering cells [..] The team is now focused on identifying the most powerful antibodies and possibly combining them to mitigate the risk of the new coronavirus mutating. If all goes well, interested developers could mass produce them for testing, first on animals and eventually on humans.

Read more …

This is where you say: no, it isn’t Iran…

Texas Pastors Demand “Religious Liberty” Exemption To Stay-at-home Orders (Vox)

Last week, Harris County Judge Lina Hidalgo, who oversees the area of Texas that includes Houston, issued an order requiring “all individuals currently living within Harris County … to stay at their place of residence except for Essential Activities” (in Texas, the title “county judge” refers to the chief executive of a county government). Like many similar orders handed down by state and local officials throughout the United States, which are intended to slow the spread of the coronavirus pandemic, Hidalgo’s order closes most businesses within the county and shuts down most places where people gather in large groups. Although it allows faith leaders to “minister and counsel in individual settings, so long as social distance protocols are followed,” it requires worship services to “be provided by video and teleconference.”

That restriction on in-person worship services has sparked a lawsuit, filed by three Texas pastors and Steven Hotze, a medical doctor and anti-LGBT Republican activist whose political action committee was labeled a hate group by the Southern Poverty Law Center. These four men ask the Texas Supreme Court to strike down Hidalgo’s order, claiming, among other things, that it violates the “religious liberty” of pastors who wish to gather their parishioners together during a pandemic. Under existing precedents, the petitioner’s arguments in Hotze are not strong. They rely heavily on older US Supreme Court decisions that were effectively overruled by the Supreme Court’s later decision in Employment Division v. Smith (1990) (although it’s worth noting that Smith is very much out of favor with judicial conservatives and could, itself, be overruled by the Court’s current majority).

The Hotze petitions also essentially ask the Texas Supreme Court to place the temporary interests of a few pastors before the county’s interest in combating a deadly disease. The US Supreme Court has long held that the government may take targeted action to protect especially compelling interests — even when doing so implicates constitutional rights.

Read more …

The headline feels designed to cast doubt on the man.

Chomsky: Ventilator Shortage Exposes the Cruelty of Neoliberal Capitalism (TO)

The scale of the plague is surprising, indeed shocking, but not its appearance. Nor the fact that the U.S. has the worst record in responding to the crisis. Scientists have been warning of a pandemic for years, insistently so since the SARS epidemic of 2003, also caused by a coronavirus, for which vaccines were developed but did not proceed beyond the pre-clinical level. That was the time to begin to put in place rapid-response systems in preparation for an outbreak and to set aside spare capacity that would be needed. Initiatives could also have been undertaken to develop defenses and modes of treatment for a likely recurrence with a related virus.

But scientific understanding is not enough. There has to be someone to pick up the ball and run with it. That option was barred by the pathology of the contemporary socioeconomic order. Market signals were clear: There’s no profit in preventing a future catastrophe. The government could have stepped in, but that’s barred by reigning doctrine: “Government is the problem,” Reagan told us with his sunny smile, meaning that decision-making has to be handed over even more fully to the business world, which is devoted to private profit and is free from influence by those who might be concerned with the common good. The years that followed injected a dose of neoliberal brutality to the unconstrained capitalist order and the twisted form of markets it constructs.

The depth of the pathology is revealed clearly by one of the most dramatic — and murderous — failures: the lack of ventilators that is one the major bottlenecks in confronting the pandemic. The Department of Health and Human Services foresaw the problem, and contracted with a small firm to produce inexpensive, easy-to-use ventilators. But then capitalist logic intervened. The firm was bought by a major corporation, Covidien, which sidelined the project, and, “In 2014, with no ventilators having been delivered to the government, Covidien executives told officials at the [federal] biomedical research agency that they wanted to get out of the contract, according to three former federal officials. The executives complained that it was not sufficiently profitable for the company.”

Doubtless true. Neoliberal logic then intervened, dictating that the government could not act to overcome the gross market failure, which is now causing havoc. As The New York Times gently put the matter, “The stalled efforts to create a new class of cheap, easy-to-use ventilators highlight the perils of outsourcing projects with critical public-health implications to private companies; their focus on maximizing profits is not always consistent with the government’s goal of preparing for a future crisis.”

Read more …

“The lunatic minister of health in Apartheid #Israel, the one who said #Covid_19 was a sign of #Armageddon and the #Messiah arriving in April; just confirmed positive for the virus along with his wife.”

Israeli Doctors Demand Health Minister Be Replaced By Professional (YNet)

Israeli doctors on Sunday called on the government to replace Health Minister Yaakov Litzman with a medical professional in the wake of coronavirus crisis in the country. In an open letter some to Prime Minister Benjamin Netanyahu and his future coalition partner Benny Gantz, the heads of hospital departments and senior medical officials expressed their dissatisfaction with Litzman’s conduct during the COVID-19 epidemic and urged to replace him with someone who has the necessary experience. Netanyahu and Gantz are in the midst of unity talks in an effort to agree on a coalition government to address the coronavirus pandemic emergency.


Sources familiar with the negotiations told Ynet the replacement of Litzman is not currently on the table. “We have nothing against outgoing Health Minister Litzman and have great respect for him,” said Professor Yoram Kluger, Rambam Hospital’s chief of surgery who was behind the initiative. “But, in light of the dire state Israel’s healthcare system and an emergency on the scope of a pandemic, health workers can no longer agree to be cast aside by other considerations.”

Read more …

Extremely long by Whitney Webb. And then there are at least 3 parts. Maybe somebody actually has the time to read it.

All Roads Lead To Dark Winter (Whitney Webb & Raul Diego)

In late June 2001, the U.S. military was preparing for a “Dark Winter.” At Andrews Air Force Base in Camp Springs, Maryland, several Congressmen, a former CIA director, a former FBI director, government insiders and privileged members of the press met to conduct a biowarfare simulation that would precede both the September 11 attacks and the 2001 Anthrax attacks by a matter of months. It specifically simulated the deliberate introduction of smallpox to the American public by a hostile actor.

The simulation was a collaborative effort led by the Johns Hopkins Center for Civilian Biodefense Strategies (part of the Johns Hopkins Center for Health Security) in collaboration with the Center for Strategic and International Studies (CSIS), the Analytic Services (ANSER) Institute for Homeland Security and the Oklahoma National Memorial Institute for the Prevention of Terrorism. The concept, design and script of the simulation were created by Tara O’Toole and Thomas Inglesby of the Johns Hopkins Center along with Randy Larsen and Mark DeMier of ANSER.

The name for the exercise derives from a statement made by Robert Kadlec, who participated in the script created for the exercise, when he states that the lack of smallpox vaccines for the U.S. populace means that “it could be a very dark winter for America.” Kadlec, a veteran of the George W. Bush administration and a former lobbyist for military intelligence/intelligence contractors, is now leading HHS’ Covid-19 response and led the Trump administration’s 2019 “Crimson Contagion” exercises, which simulated a crippling pandemic influenza outbreak in the U.S. that had first originated in China. Kadlec’s professional history, his decades-old obsession with apocalyptic bioweapon attack scenarios and the Crimson Contagion exercises themselves are the subject of Part III of this series.

Read more …

 

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Support us in virustime. Help the Automatic Earth survive. It’s good for you.

 

Jan 082020
 


Dorothea Lange Farm boy at main drugstore, Medford, Oregon 1939

 

Iranian Strike Was ‘Proportionate’ Self-Defense, No Need For War – FM Zarif (RT)
Predictions for the 2020s (Dmitry Orlov)
Some Other People Do Some Other Things (Kunstler)
Maduro Opponents Storm Parliament To Reinstall Guaidó As Leader (G.)
Boeing Changes Stance, Recommends 737 MAX Simulator Training For Pilots (R.)
US, EU Regulators To Meet With Boeing This Week On 737 Max Software Audit (R.)
Shadow Banking Runs (MW)
The Americans Dying Because They Can’t Afford Medical Care (G.)
‘Roadmap To Recovery’ Could Reverse Insect Apocalypse (G.)
Love the Land or Watch It Die (Yates)

 

 

I don’t know exactly what lies behind the US attack on Soleimani anymore than others do. The difference between us appears to be that I don’t pretend to know. Is the attack truly the start of WWIII, as I see many voices present as fact? Or did the US merely take out a dangerous individual? I don’t know, and neither do they.

If the Iranian reaction is anything to go by, WWIII seems far away. Tehran did what Trump did in Syria: dump missiles in the desert. They purposely avoided hitting their targets, and killing anyone. We know this because they know the region very well and their missiles are good enough to hit what they want to hit.

Don’t let’s forget that Iran can’t and won’t do much of anything without talking to Putin -and perhaps Xi- first. Putin yesterday flew to Syria, maybe just to make his presence known. It is no use for anyone to discuss Iran-US without including Putin.

What the entire situation may boil down to is even a new opening for talks between Iran and the US. Whether that is more or less likely than WWIII is something I don’t know, and neither do all those commentators.

As for all the war belligerent talk by Tehran and Washington, it’s how these things are conducted; no use taking that stuff at face value. Iran must talk the talk, and fly the missiles, for domestic purposes. Ditto for Trump.

Iran FM Zarif -who was refused a US visa just days ago- makes a peace offer. And sure, oil prices shoot up, but neither country sees that as a bad thing -for now-.

 

Iranian Strike Was ‘Proportionate’ Self-Defense, No Need For War – FM Zarif (RT)

Missile strikes against US bases in Iraq were legitimate self-defense measures and are now over, as Iran does not intend to wage war or escalate the situation further, Foreign Minister Javad Zarif has said. Two volleys of missiles aimed at the Al-Asad base in Iraq’s Anbar province and another facility near Erbil were “proportionate measures in self-defense” under 51 of the UN Charter, Zarif tweeted from Tehran in the early hours of Wednesday, describing the action as “completed.” Zarif noted that the strikes targeted the US base from which “cowardly” attacks were launched against Iranian citizens and senior officials – referring to General Qassem Soleimani, head of the Islamic Revolutionary Guard Corps (IRGC) Quds Force, killed in a drone strike outside Baghdad last week.


Iran threatened “hard revenge” against the US for Soleimani’s death. The strike on Al-Asad reportedly took place at 01:20 local time on Wednesday, the exact time Soleimani’s convoy had been struck. Another volley of missiles followed about an hour later. The Pentagon said no Americans were killed in the attacks. There are conflicting reports about possible Iraqi casualties. As it sent out the two missile volleys, the IRGC threatened any regional US allies they would be targeted next if their territory is used for any follow-up attacks on Iran.

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Trump’s tweet: All is well! Missiles launched from Iran at two military bases located in Iraq. Assessment of casualties & damages taking place now. So far, so good! We have the most powerful and well equipped military anywhere in the world, by far! I will be making a statement tomorrow morning.

If the US press were in working order, Trump would not make such crazy claims. But nobody tells Americans how far Russia has moved ahead of the US in military matters. Dmitry explains again:

Predictions for the 2020s (Dmitry Orlov)

With regard to military matters, it seems safe to declare that by the end of the 2020s the US empire will be definitively over. It is already the case that the US can no longer even threaten a long list of countries, especially those armed with Russia’s new air defense systems which can establish no-fly zones for US aircraft, while the US military cannot function at all if it is denied air superiority. It is also already the case that the entire US aircraft carrier fleet is obsolete and useless because the latest Russian missiles can reliably sink it from greater distances than can be reached by the armaments or the aircraft these aircraft carriers carry.

Add to this the fact that Russia’s latest missiles, which can achieve Mach 20 and which cannot be intercepted using any current or planned missile defense systems, make it possible to take out targets on the US mainland, including the Pentagon itself, should the US ever attack Russia. The US still has nuclear deterrence, plus the ability to cause minor mischief by arming and training terrorist groups around the world, but it is so woefully behind Russia in weapons development that it will probably never catch up in spite of constantly outspending Russia ten-to-one on defense.

Russia’s stance with regard to NATO troops training, preening and posturing provocatively right on Russia’s borders has been largely dismissive. Russia has largely rearmed with new weapons based on new physical principles known only to its scientists, engineers and designers and is now cutting its defense budget while bringing in billions from increased worldwide weapons sales. The US cannot catch up—not due to lack of money (as long as the printing press continues to run) but due to lack of brains.

As the impotence of the US military becomes obvious, the NATO alliance will come apart. Already Turkey, which is NATO’s second-largest member, is barely a member at all and far more interested in cooperating with Russia and Iran on defense matters rather than with the US. In spite of this, the US military-industrial complex will continue its zombie-like existence until the money dries up, at which point my initial prediction of US troops left stranded at a multitude of overseas locations with no resources available to repatriate them will come true.

[..] Although collapse in the US is yet to run its course, I feel that it is already time to give the United States of America a more appropriate name. After all, it is not the only united states on the American continent: there is also Estados Unidos Mexicanos. This shameful, self-important name-squatting has to come to an end at some point. I therefore propose renaming the USA—perhaps not immediately, but perhaps in a decade, maybe two. As its new name I would like to suggest something like the Republic of Deteriorado, Degenerado or Disintegrado. Its national language is likely to become Spanglish. Its national bird already seems to be the extended middle finger. As for its flag, here we can simply observe which flag is considered sufficiently sacred and inviolable to result in jail time for anyone who dares to burn it in public. And it turns out to be the LGBTQ rainbow flag.

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“..the two countries slugged it out through the entire 1980s. About a quarter-million people died in that war. ..”

Some Other People Do Some Other Things (Kunstler)

The financial markets know that a lot less new investment will flow into shale oil from now on, since it was a lousy investment the past ten years, despite all the admirable techno-virtuosity behind it, and that before long the mighty shale oil bell curve will turn down, and everything economic with it. Folks who make foreign policy and military plans may sense this too, perhaps dimly. But then they confront the additional mystifying calculus of all those moiling parties in the Middle East jockeying for position and advantage as the oil-hungry big dogs of the world desperately try to figure how to keep those oil flows going their way.

Eventually — and sooner rather than later — the mighty flows of everything in the global economy have to neck down, and the process will probably consist of sharp political and economic shocks rather than simple deceleration. Just such a shock was the assassination of General Qassim Suleimani. His multifarious activities all around the Middle East were in themselves a symptom of the instability dogging Iran as its economy wobbles. Much of that is due to the squeeze that the USA put on Iran in the way of trade sanctions and currency movements. And much of that stems from events over forty years ago when the mullahs ran the shah out of town and took the American embassy staff hostage for well over a year. The enmity on both sides runs wide and deep.

Iran’s neighbor, Iraq, is quite a prize oil-wise, and Iran has made significant inroads attempting to gain control of that broken country, even while the USA retains its garrisons there. The region of Iraq closest to Iran, Basra, is overwhelmingly Shia, like Iran, and produces a lot of Iraq’s oil. Baghdad is not so hot to give it up. Remember, the two countries slugged it out through the entire 1980s. About a quarter-million people died in that war. It is surely a high priority for the USA to not let that Iraqi oil slip into Iran’s hands. It’s a zero-sum game, of course, because even Iraq’s copious oil reserves will not save the global economy’s ass, let alone Iran’s economy.

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It’s become laughable. Exclusively.

Maduro Opponents Storm Parliament To Reinstall Guaidó As Leader (G.)

Venezuela’s increasingly byzantine political meltdown took its latest turn on Tuesday as opponents of authoritarian president Nicolás Maduro stormed the country’s parliament to reinstall Juan Guaidó as their leader. Troops loyal to Maduro had surrounded the palm-dotted national assembly compound in Caracas in a bid to keep Guaidó and his supporters out after the president’s attempt to seize control of the parliament on Sunday. But in frantic scenes that spread rapidly on social media, Guaidó and his backers were filmed physically forcing their way into the 19th-century capitol to cheers of “Viva Venezuela!” Outside, pro-government thugs attacked and robbed Venezuelan and European journalists, including one correspondent from Spain’s El País.


Inside, Guaidó was sworn in for a second term as Venezuela’s caretaker leader, even though the auditorium’s electricity had been cut. “In the name of those who have no voice, of the mothers who weep in the distance, of the teachers who are battling and the nurses and the students, of the political prisoners … in the name of Venezuela, I vow to fulfill the duties of interim president,” said Guaidó, who is recognized by more than 50 governments including the United States and United Kingdom but boasts little concrete power. Guaidó’s wife, Fabiana Rosales, tweeted: “Now the struggle goes on, together with all Venezuelans we will rescue our country from dictatorship.”

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But they don’t have nearly enough simulators.

Boeing Changes Stance, Recommends 737 MAX Simulator Training For Pilots (R.)

If U.S. and international regulators ultimately back Boeing’s proposal, it could take airlines longer to prepare their crews to fly the 737 MAX jets that have been grounded since March after two crashes that killed 346 people. Boeing has been working on revised pilot training and software updates for the 737 MAX to win regulatory approval for the jets to fly commercially again. After repeated setbacks, the U.S. Federal Aviation Administration (FAA) is not expected to give the greenlight until at least February, perhaps March or later. Last year, the planemaker said it would propose that MAX pilots did not need to train on costly simulators, a position it originally used to market the latest version of its 737 narrowbody workhorse against competition from European rival Airbus.

Airlines that bought the MAX have had to cancel flights while the global fleet remains grounded. If only computer-based training were required for renewed 737 MAX commercial flying, Boeing’s largest customer Southwest Airlines had said it would take one to two months to prepare its more than 9,500 pilots on the updates. Southwest had not been part of Boeing’s recent discussions on pilot training recommendations and could not provide additional cost or timing estimates before there was specific guidance, spokeswoman Brandy King said. Southwest has three MAX simulators in various stages of FAA certification and expects three more later this year.

American Airlines and United Airlines each have one MAX simulator. Not many MAX simulators exist and it was unclear if training could be performed on the 737 NG simulator that 737 pilots have used until now. As of December, Toronto-based manufacturer CAE had delivered 23 MAX full-flight simulators, a spokeswoman said.

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This could have been written a year ago. Any progress?

US, EU Regulators To Meet With Boeing This Week On 737 Max Software Audit (R.)

U.S. and European aviation safety regulators will meet with Boeing this week in an effort to complete a 737 MAX software documentation audit – a key step toward the grounded plane’s eventual return to service. The European Union Aviation Safety Agency (EASA) and Federal Aviation Administration (FAA) both confirmed on Tuesday that they will meet in the Seattle-area with Boeing before heading to a Rockwell Collins facility in Cedar Rapids, Iowa, in an effort to complete the audit. Documentation requirements are central to certification for increasingly complex aircraft software, and can become a source of delays. In 2008, EASA nearly derailed Europe’s Airbus A400M military transporter over software documentation following a failed audit.


In early November, EASA and FAA met with Boeing at the Rockwell Collins facility in Cedar Rapids and did not approve the audit. Instead, they sought revisions to the documentation of the 737 MAX software fix and flagged a number of issues, Reuters reported. In mid-January, Boeing will halt production on the best-selling plane, which has been grounded since March following two crashes in Ethiopia and Indonesia that killed 346 people in five months. Boeing said on Monday it was reassigning 3,000 employees to other jobs as a result of the temporary halt. Reuters has reported previously that the FAA is unlikely to approve the plane until at least February and perhaps until March or later. Boeing said in November that regulators had requested the “information be conveyed in a different form, and the documentation is being revised accordingly.”

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Big in China.

Shadow Banking Runs (MW)

The U.S. shadow banking sector is alive and well, growing at a fast pace and remains opaque, experts said Friday. And while the sector might not cause the next downturn, it could add to the economy’s troubles in a downturn. The shadow banking sector, now called by the more polite term “private debt market’ has roughly tripled in size over the past few years and one estimate puts the size around $1.2 trillion, said Steven Kaplan, a professor at the University of Chicago, at the American Economics Association conference in San Diego. About half of the market is collateralized loan obligations, or CLOs. These are business loans pooled together and carved into investment products.

The other half are direct loans to businesses by private firms, or DLFs, or by business development companies known as BDCs that are set up like real estate investment trusts. The loans go to U.S. middle-market companies, with sales between $10 million and $1 billion that are typically not publicly traded. Kaplan said the growth in private debt market shows no sign of slowing down. In the wake of the financial crisis, federal regulators placed new rules on banks but with global interest rates low, institutional investors are reaching for yield and there is increased demand for private market debt.

Jeremy Stein, a former Federal Reserve governor and a finance expert at Harvard, said he was “ambivalent” about the trend. On the one hand, private debt funds are generally holding more equity than traditional banks. But at the same time, especially for the open-ended funds, their investors can demand their money at any time, Stein said. And there might be advantages to leaving first. “They can get run on,” he said.

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Why study, invent new tools etc., if you’re not going to use them?

The Americans Dying Because They Can’t Afford Medical Care (G.)

A December 2019 poll conducted by Gallup found 25% of Americans say they or a family member have delayed medical treatment for a serious illness due to the costs of care, and an additional 8% report delaying medical treatment for less serious illnesses. A study conducted by the American Cancer Society in May 2019 found 56% of adults in America report having at least one medical financial hardship, and researchers warned the problem is likely to worsen unless action is taken. Dr Robin Yabroff, lead author of the American Cancer Society study, said last month’s Gallup poll finding that 25% of Americans were delaying care was “consistent with numerous other studies documenting that many in the United States have trouble paying medical bills”.


Despite millions of Americans delaying medical treatment due to the costs, the US still spends the most on healthcare of any developed nation in the world, while covering fewer people and achieving worse overall health outcomes. A 2017 analysis found the United States ranks 24th globally in achieving health goals set by the United Nations. In 2018, $3.65tn was spent on healthcare in the United States, and these costs are projected to grow at an annual rate of 5.5% over the next decade. [..] A 2009 study conducted by researchers at Harvard Medical School found 45,000 Americans die every year as a direct result of not having any health insurance coverage. In 2018, 27.8 million Americans went without any health insurance for the entire year.

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“Scientists” should not lead this. You and I should, armed with the precautionary principle.

‘Roadmap To Recovery’ Could Reverse Insect Apocalypse (G.)

The world must eradicate pesticide use, prioritise nature-based farming methods and urgently reduce water, light and noise pollution to save plummeting insect populations, according to a new “roadmap to insect recovery” compiled by experts. The call to action by more than 70 scientists from across the planet advocates immediate action on human stress factors to insects which include habitat loss and fragmentation, the climate crisis, pollution, over-harvesting and invasive species. Phasing out synthetic pesticides and fertilisers used in industrial farming and aggressive greenhouse gas emission reductions are among a series of urgent “no-regret” solutions to reverse what conservationists have called the “unnoticed insect apocalypse”.

Alongside these measures, scientists must urgently establish which herbivores, detritivores, parasitoids, predators and pollinators are priority species for conservation, according to a new paper published in Nature Ecology & Evolution. The animals are crucial to the healthy functioning of ecosystems by recycling nutrients, serving as pollinators and acting as food for other wildlife. The paper comes amid repeated warnings about the threat of human-driven insect extinction causing a “catastrophic collapse of nature’s ecosystems”, with more than 40% of insect species declining and a third endangered, according to the first worldwide scientific review, published in February 2019.

[..] The scientists have called on governments to follow the example of Germany, which announced a €100m action plan for insect protection in September 2019, adding that there is a strong consensus among experts that the decline of insects, other arthropods and global biodiversity is a serious threat that society must address. In the short term, the roadmap advocates immediate action on rewilding and conservation programmes, avoiding and mitigating the impact of alien species and prioritising imports that are not produced at the cost of species-rich ecosystems. Enhancing citizen science projects to improve data quality and inform academic study was also deemed a priority.

“Most importantly, we should not wait to act until we have addressed every key knowledge gap. We currently have enough information on some key causes of insect decline to formulate no-regret solutions whilst more data are compiled for lesser known taxa and regions and long-term data are aggregated and assessed,” the roadmap states.

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The precautionary principle added to being in constant awe of a world we cannot even begin to comprehend. Or: what conservatism should really be about.

Love the Land or Watch It Die (Yates)

Sagebrush, Ponderosa Pine, Juniper Trees, and Piñón Pine are important flora in the western United States. Juniper can live more than 1,000 years, as can some Piñón. Ponderosa live up to 400 years. Sagebrush is a perennial and can survive for 100 years. All have been and are used for a variety of purposes by native peoples. They are also integral parts of what were once vibrant ecosystems in some of the most beautiful and astonishing parts of the United States. The ways in which plants, grasses, trees, and wildlife interreacted, in what are harsh environments, was remarkable. Not only could we learn much from studying these ecosystems, but their sheer beauty made them places worthy of contemplation and awe.

We know that biodiversity is essential to any efforts to limit global warming, to avoid devastating fires, to, in a word, the maintenance of a healthy, habitable earth. Where a part of the planet is healthy, it should not be made unhealthy. John Donne said, “No man is an island entire of itself; every man is a piece of the continent, a part of the main.” But then he wrote, “if a clod be washed away by the sea, Europe is the less, as well as if a promontory were.” That is, the human and the non-human world are intimately connected, in ways increasingly known by scientists but little understood by most of us, to our detriment.

Unfortunately, the integrity of the earth has been constantly ripped apart by the incessant drive for cash benefit. In the Intermountain West, that space between the Front Range of the Rocky Mountains to the east and the Cascade Range and the Sierra Nevada to the west, government agencies, in league with powerful economic interests and even environmental groups, have joined together to utterly devastate the land. The Bureau of Land Management, the U.S. Forest Service, Fish and Wildlife Service, the National Park Service, and numerous state agencies, routinely poison and otherwise kill wolves, mountain lions, grizzlies, and coyotes; effectively privatize public lands; and apply pesticides to, chainsaw, and otherwise rip apart sagebrush, Ponderosa, Piñón, and Juniper.

While pseudoscientific justifications are sometimes offered to the gullible, the goal is to free public lands for mining, drilling, logging, jeep and ATV tourism, and worst of all, cattle grazing. The results have been predictable: invasive species, ruined ecosystems, species on the verge of extinction, repulsive animal cruelty, and the diminution of public property. Further, the more this is done, the more it will continue to be done, as the public comes to think of that which is now is normal, if they think at all.

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Eloquence. Watch.

 

 

 

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Jun 282019
 
 June 28, 2019  Posted by at 9:41 am Finance Tagged with: , , , , , , , , , , ,  13 Responses »


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.”

Read more …

“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.

Read more …

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.”

Read more …

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.

Read more …

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.

Read more …

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.

Read more …

 

 

 

 

 

Jun 252019
 


Caravaggio Conversion on the way to Damascus 1600-01

 

Something’s been nagging me for the past few days, and I’m not sure I’ve figured out why yet. It started when Donald Trump first called off the alleged planned strikes on targets in Iran because they would have cost 150 lives, and then the next day said the US would do sanctions instead. As they did on Monday, even directly targeting Trump’s equal, the “Supreme Leader Khameini”.

When Trump announced the sanctions, I thought: wait a minute, by presenting this the way you did, you effectively turned economic sanctions into a military tool: we chose not to do bombs but sanctions. Sounds the same as not doing a naval invasion but going for air attacks instead. The kind of decisions that were made in Vietnam a thousand times.

However, Vietnam was all out war (well, invasion is a better term). Which shamed the US, killed and maimed the sweet Lord only knows how many promising young Americans as well as millions of Vietnamese, and ended in humiliating defeat. But the US is not in an all out war in Iran, at least not yet. And if they would ever try to be, the outcome would be Vietnam squared.

Still, that’s not really my point here. It’s simply about the use of having the world reserve currency as a military weapon instead of an economic one. And I think that is highly significant. As well as an enormous threat to the US. The issue at hand is overreach.

While you could still argue that economic sanctions on North Korea, Venezuela and Russia are just that, economic and/or political ones, the way Trump phrased it, comparing sanctions one on one with military strikes, no longer leaves that opening when it comes to Iran. The new Iran sanctions are a preliminary act of war. Simply because of how he presented them. He explicitly stated that he swapped one for the other.

 

There are quite a few people who have been harping on the demise of the USD as reserve currency for a long time, and I always think: look, nobody wants the yuan, let alone the ruble. There’s no trade being executed in these currencies. So taking over from the USD is a pipe dream.

But that may very well change, and perhaps very fast too, if the US uses the dollar not as an economic weapon (and there are plenty issues with that already), but as a military one. That would potentially hugely speed up any efforts to move away from the buck in international trade.

For the simple reason that it becomes unreliable. Traders hate that, they can’t have that. A reserve currency must be neutral -to a point-. The world of trade doesn’t want the yuan because Beijing controls it and can therefore change conditions and values overnight. But if and when the US uses the USD as a military tool, it essentially risks doing exactly the same: it deneutralizes the USD.

Using the USD as an economic weapon is ugly, but something global trade can deal with. A military weapon, though, is something else altogether. And I see no sign that Trump understands this. The thing is, using your currency, which also happens to be the world reserve currency, as a military tool, means you’ve become a threat to everyone, the entire globe, overnight.

And people don’t want to live that way. Not Iran, not Russia, not China, not Europe, no-one. It’s one thing to use the USD for sanctions. But it’s a real different thing to use it as just a military alternative to “bombing a country into obliteration”.

 

What Trump did comes awfully close to signing the death warrant for the USD as the global reserve currency. And it’s really only because he and his people weren’t paying attention. He could have phrased the entire thing differently, and it would have been business as usual, a business that Moscow and Beijing are actively trying to undermine, but they could have waited a bit longer reacting.

Now, however, their plans have to be sped up. They’re going to be buying a lot of gold, as they’ve already been doing, they’ll try to do their mutual business in their own currencies backed by this gold, and they’ll speed up alternatives-to-USD plans with other countries in their neighborhood. Because they have no choice anymore.

I see Tyler Durden reporting that the US threatens to throw a Chinese state-owned bank out of the SWIFT system, and I think: great idea. Why not force China to quit the reserve currency system, the petrodollar, outright?! Why not force it to hasten the Asian/Russian alternative trade model into existence? What a great and lovely idea.

The US should today make friends. It should preserve the reserve currency status of the USD for as long as it can, by convincing allies and foes alike that it will protect its neutrality in global trade. But Trump and his people are doing the exact opposite, they’re playing all-on-red.

The US no longer has the economic, political or military might to dictate to the entire world any terms it wants to. Those days are long gone. That ended in Vietnam. Trump’s living in the last century, while Bolton and Pompeo, they live in their own time and world.

 

But yeah, sure, perhaps this is what the dying days of an empire MUST look like. Maybe there’s a model to follow and there’s no escape, maybe it’s all written in the stars. Like Rome and Greece and Genghis Khan. Maybe things simply just have to play out. Still, looking at that Trump statement about the new Iran sanctions that started me off, it doesn’t feel all that smart.

 

 

 

 

May 142018
 


Brassaï Cat 1945

 

What’s happening to John McCain is tragic. It’s not something one should ever wish upon another human being. Nor is it decent, let alone useful, to wish that he would die. Wishing bad things upon someone because they did bad things is too close for comfort to what he himself did. But it’s good to remember that his brain tumor is not the most tragic part of McCain’s life on earth. And no, neither is his time as prisoner of war in Vietnam.

McCain’s main tragedy is that he didn’t learn the one lesson he should have learned about his time in Vietnam, and didn’t turn his back on warfare. Instead, he turned into the biggest and loudest pro-war campaigner in Washington for decades. Talk about a missed opportunity, a life wasted. If there was one person who was presented with the first-hand experience needed to turn against bloodshed, it was John McCain.

What’s more, during his time in the House and later the Senate, McCain completely missed out on a development that might yet have changed his mind. That is, wars became unwinnable. Something even that the US losing their war in Vietnam might have taught him. It entirely passed him by. McCain still never saw an opportunity to wage battle somewhere, anywhere on the planet, that he didn’t like.

That makes him a dinosaur and a fossil who should never have been allowed to remain in the Senate for as long as he did. At the age of 81, and after ‘serving’ for 35 years in Washington, it apparently becomes too difficult to see how the world outside changes, let alone to adapt to those changes. If you limit the time a president can serve, why not do the same for senators? Is it because those same senators would have to vote on that?

Moreover, if wars are unwinnable, but you incessantly call for new wars anyway, then regardless of moral issues about going to war in the first place, you have de facto become a threat to your own people and your own country that you purport to serve. Especially, and first of all, to the American soldiers you desire to send out there to fight those wars. But also a threat to the image of America around the globe.

 

When wars are unwinnable, there is no reason to fight them. Again, even apart from morals and ethics. You will have to find other ways to deal with ‘elements’ that feel and act less than friendly towards you. To find out what, it helps to realize that they understand it’s just as futile for them to attack you militarily as it is for you to attack them. It also helps to figure out why they are unfriendly.

What doesn’t help is to take yet another stab at Putin and say “Vladimir Putin is an evil man, and he is intent on evil deeds”, as McCain does in a forthcoming book. If that’s the best you can do, your best-by date has long since passed. That’s language fit for a 4-year old. And George W.

McCain’s father and grandfather were both 4-star US Navy admirals. Perhaps that partly explains his blindness to the evils of war, and the role the US has played in many conflicts, including -but certainly not limited to- Vietnam. It’s hard to imagine Apocalypse Now, Platoon or Full Metal Jacket being McCain’s favorite Hollywood classics.

And that is a bigger problem than it may seem. Because America has indeed been able to paint a vivid portrait for itself of why Vietnam was such an insane venture that should never have happened, and certainly not repeated. If your culture has the ability to put that in words and images, and as a nation you still don’t learn the lesson embedded in them, you’re pretty much lost.

Oh, and besides, you lost too, remember? You lost the war and the lives and limbs of tens of thousands of young Americans and over a million Vietnamese. To have been part of that and then turn around and strive to be Washington’s premier warmonger, that’s just totally bonkers. Or worse. Has McCain been promoting war all this time because he subconsciously wanted to redo Vietnam but this time not lose?

 

Unwinnable wars are bad news for the weapons industry. They will deny the existence of even such a concept as long and as strongly as they can. Because if you can’t win a war, why wage them? There will continue to be technological developments, but there’s no “throughput”. You can fire some missiles into some desert somewhere from time to time, and that’s it.

The military-industrial complex is happy only -because most profitable- if and when guns and missiles and jets constantly need to be replaced because they’ve been lost in a theater of war, along with young Americans. McCain knows this better than most. And he knows the captains of this complex, both the military side and the weapons producers. Far too well.

Being as beholden as it is to the arms makers and dealers, has made America lose whatever edge it once had militarily. In the US weapons are developed and sold to generate the largest profits possible; in Russia, they are developed to protect the country. This is largely why the American defense budget is 10 times larger than its Russian counterpart. All this happened on John McCain’s watch.

The entire narrative of “protecting and sharing our values” has become hollow propaganda. Because the US has engaged its military in more theaters of war and invasion than we can even keep track of anymore. The US armed forces don’t protect democracy or human rights around the world, they protect the financial interests of America’s elites, including the military-industrial complex. Does anyone believe John McCain doesn’t know this?

 

Unbeknownst to John McCain, the world has entered a whole new era. And this didn’t happen yesterday. Russia and China may have only recently announced new hypersonic missile technology, but it didn’t fall out of the sky. It does profoundly change things though. It ends all notions and dreams of American exceptionalism and unilateralism.

And America needs to learn that lesson. It will have to do it without John McCain. And it might as well, because McCain was incapable of changing, and of seeing the changes around him. But the American view of the world will have to change, because the world itself has.

Still, you’re right: the real tragedy is not that John McCain wasted his own life. It’s that he helped destroy so many others.

 

 

Apr 172018
 


Charles Sprague Pearce Lamentations over the Death of the First-Born of Egypt 1877

 

In Matthew 12:22-28, Jesus tells the Pharisees:

 

Every kingdom divided against itself is brought to desolation, and every city or house divided against itself will not stand.

In 1858, US Senate candidate Abraham Lincoln borrows the line:

 

On June 16, 1858 more than 1,000 delegates met in the Springfield, Illinois, statehouse for the Republican State Convention. At 5:00 p.m. they chose Abraham Lincoln as their candidate for the U.S. Senate, running against Democrat Stephen A. Douglas. At 8:00 p.m. Lincoln delivered this address to his Republican colleagues in the Hall of Representatives. The title reflects part of the speech’s introduction, “A house divided against itself cannot stand,” a concept familiar to Lincoln’s audience as a statement by Jesus recorded in all three synoptic gospels (Matthew, Mark, Luke).

Even Lincoln’s friends regarded the speech as too radical for the occasion. His law partner, William H. Herndon, considered Lincoln as morally courageous but politically incorrect. Lincoln read the speech to him before delivering it, referring to the “house divided” language this way: “The proposition is indisputably true … and I will deliver it as written. I want to use some universally known figure, expressed in simple language as universally known, that it may strike home to the minds of men in order to rouse them to the peril of the times.”

On April 12, 2018, the Washington Post runs this headline:

We need to go big in Syria. North Korea is watching.

The WaPo is undoubtedly disappointed that James Mattis prevailed over more hawkish voices in Washington and the least ‘expansive’ attack was chosen.

Then after the attack, Russian President Putin warns of global ‘chaos’ if the West strikes Syria again. And I’m thinking: Chaos? You ‘Predict’ Chaos? You mean what we have now does not qualify as chaos?

Yes, Washington Post, North Korea is watching. And you know what it sees? It sees a house divided. It sees an America that is perhaps as divided against itself as it was prior to the civil war. An America that elects a president and then initiates multiple investigations against him that are kept going seemingly indefinitely. An America where hatred of one’s fellow countrymen and -women has become the norm.

An America that has adopted a Shakespearian theater as its political system, where all norms of civil conversation have long been thrown out the window, where venomous gossip and backstabbing have become accepted social instruments. An America where anything goes as long as it sells.

 

In an intriguing development, while Trump pleased the Washington Post, New York Times, CNN and MSNBC, his declared arch-enemies until the rockets flew, his own base turned on him. While the ‘liberals’ (what’s in a word) cheered and smelled the blood, the right wing reminded the Donald that this is not what he was elected on – or for.

Can Trump afford to lose his base? Isn’t the right wing supposed to be the side that calls for guns and bombs? It’s unlikely that he can do without his base, it would weaken him a lot as the Lady Macbeths watch his every move looking for just that one opportunity, that one moment where his back is turned.

As for the right wing not being the bloodthirsty one, that is quite the shift. Not that it’s a 180 on a dime, it has been coming for a while. It’s not just interesting with regards to Trump, there are many war hawks who -will- see their support crumble too if or when they speak out for more boots in deserts. Maybe John McCain should consider changing parties?

 

So yeah, what does North Korea see? Should it be afraid? Will it have become more afraid? Kim Jong-Un will have watched for China’s reaction, much more important to him that what the US does. And China has condemned the attack. It would do the same if America were to attack North Korea, and a lot stronger. Therefore Kim Jong-Un doesn’t believe Washington will dare attack him.

An interesting line from Chinese state run newspaper Global Times illustrates how China sees the world, and the US in particular, at present:

 

“A weak country has no diplomacy. As a hundred years have passed, China is no longer that [weak] China, but the world is still that world.”

That is how China, and in its wake, North Korea, see America. And so does Russia. Americans may -and do- think that they are still no. 1, and the most powerful, economically, politically, militarily, but that’s no longer what the rest of the world sees.

Is the US still mightier than China militarily? Probably, but not certainly. Still, how do you conquer 1.3 billion people and keep them subdued? Xi Jinping is very aware of that, and he bides his time.

Is the US still mightier than Russia militarily? Almost certainly not. To quote Paul Craig Roberts once more (and he’s no amateur):

The Russians know that they can, at will within a few minutes, sink the entire US fleet, destroy every US airplane & ship in the ME & within range of the ME, completely destroy all of Israel’s military capability & wipe out the military of the two-bit punk state of Saudi Arabia.

I’ve written this before in the past: there is a big difference between how America sees and treats its military, and how Russia does it. A difference that explains how Russia can, with one tenth of American defense spending, still be militarily superior, or at least make any wars against it unwinnable.

That is, in the US the focus is not on making the best weapons, it’s on making the most money on weapons. Boeing, Raytheon, Lockheed will develop those weapons that are most profitable, not those that are most effective. The interminable story of the development of the Joint Strike Fighter is perhaps the best example of this, but there are many others. The Pentagon is a money pit.

Americans can perhaps still make the best weapons for the least money, but they don’t do it. Russia does. For Putin, the best weapons are a matter of survival. Russia has been under American threat as long as he can remember.

While Americans believe so strongly in their supremacy, and have grown so accustomed to the idea, that they no longer see having the best weapons as a matter of survival for the nation. They have come to see their superiority as something automatic and natural.

 

The attack on Syria is seen as a sign of weakness. Because there was no need for it. Because the evidence is flimsy at best. Because the world has international bodies to deal with such issues. Because there is no logic in allowing the blood to flow in the Gaza and Yemen but cite humanitarian reasons for bombing alleged chemical facilities elsewhere.

What the world sees is bluster emanating from a deeply divided nation (and we haven’t even tackled Britain). It sees that less than 48 hours after the airstrikes, a former FBI chief talks about his former boss in terminology that nobody would dare use in most countries, and throughout most of history,

James Comey is beyond Shakepeare. And in America, the issue is who’s right in the Comey-Trump conflict. In Russia, China et al it’s not. They see a house, a country divided. A weak country has no diplomacy.

That’s how all empires end. Complacency and division. That is what North Korea sees when it watches America, what China, and Russia see. And they may even know how Jesus put it. He didn’t just say a kingdom divided would become less powerful or wealthy, he said:

 

Every kingdom divided against itself is brought to desolation.

 

 

Jul 312016
 
 July 31, 2016  Posted by at 9:05 am Finance Tagged with: , , , , , , , , ,  1 Response »


DPC Elks Temple (Eureka Club), Rochester, NY 1908

How Slow Is US Economic Growth? ‘Close To Zero’ (CNBC)
US Non-Consumer Economy Is Now In A Recession (ZH)
US Government Entitlements – Sixth Biggest Economy On Earth (Stockman)
Helicopter Money Talk Takes Flight As Bank of Japan Runs Out Of Runway (R.)
No Clean Bill Of Health For EU Banks In Stress Test (R.)
Ireland Jails Three Top Bankers Over 2008 Banking Meltdown (R.)
Australia’s Property Market Is Completely Bonkers (Schwab)
Minsky’s Moment (Economist)
The IMF Confesses It Immolated Greece On Behalf Of The Eurogroup (YV)
Econocracy Has Split Britain Into Experts And Ordinary People (G.)
Network Close To NATO Military Leader Fueled Ukraine Conflict (Spiegel)
America’s Military Is “Lender Of Last Resort” (Cate Long)

 

 

Not a pretty picture.

How Slow Is US Economic Growth? ‘Close To Zero’ (CNBC)

While 2016’s anemic growth level isn’t an automatic disqualifier for an interest rate increase, the bar just got a little higher. Friday’s GDP reading fell below even the dimming hopes on Wall Street. The 1.2% growth ratein the second quarter combined with a downward revision to the first three months of the year to produce an average growth rate of just 1%. In total, it was far below the Wall Street forecast of 2.6% second-quarter growth and didn’t lend a lot of credence to a Fed statement earlier this week that sounded more confident on the economy. (The Atlanta Fed was much closer, forecasting 1.8%.) In short, they are not numbers upon which a rate hawk would want to hang one’s hat.

“We’re tired of talking about rate hikes when it’s not going to happen for a while,” Diane Swonk of DS Economics told CNBC. “I really think the Fed is sidelined until the end of the year. Or, perhaps, longer. Market expectations for the next Fed hike had been sliding as the release of the GDP report got closer, and they plunged afterward. The fed funds futures market Friday morning was indicating just a 34.4% chance of a rate rise this year, with the next move pushed out until well into 2017. A day earlier, the futures market had moved to just over 50% for a 2016 move. The Fed last hiked in December 2015, which was the first move after eight years of keeping the overnight rate near zero.

To be sure, GDP growth is just one input for the central bank. Ostensibly, the Fed’s mandate is to ensure full employment and price stability, and it has come close to achieving the former while continually falling short of the latter. [..] .. the Fed has been warning about weak business investment, and Friday’s data showed those concerns were well-founded. Business investment fell 2.2%, its third consecutive quarterly decline. Gross private domestic investment tumbled 9.7%, and residential investment, which had been on the rise, reversed course and declined 6.1%, the first decrease since early 2014. Those numbers act as a counterweight to the declining jobless rate, which is down to 4.9%.

“What is really worrying is that pace has still been enough to reduce the unemployment rate further, suggesting that the economy’s potential growth rate could conceivably be close to zero,” Paul Ashworth, chief U.S. economist at Capital Economics, said in a note. The headline jobless rate has been declining, in part, due to a generational low in labor force participation, suggesting that outside a decline in labor slack, there’s little moving economic growth.

Read more …

And consumer spending is set to contract sharply.

US Non-Consumer Economy Is Now In A Recession (ZH)

While yesterday’s GDP report was an undisputed disappointment, printing at 1.2% or less than half the 2.5% expected following dramatic historical data revisions, an even more troubling finding emerged when looking at the annual growth rate of GDP.  This is how Deutsche Bank’s Dominic Konstam summarized what we showed yesterday

The latest GDP release favors our hypothesis of an imminent endogenous labor market slowdown over a more optimistic scenario in which productivity will replace employment as the engine for growth. With real GDP growing at just 1.2%, there is little evidence that productivity is ready to do the heavy lifting. We are particularly concerned because annual nominal growth has slowed to 2.4%, essentially a cyclical trough

He was looking at the following chart (which as the BEA admitted yesterday, may be revised even lower in coming quarters).

 

However, as it turns out, that was not even the biggest risk. Recall that even as overall GDP rose a paltry 1.2%, somehow the consumer-driven portion of this number soared, with Personal Consumption Expenditures surging at an annualized 2.8% rate, nearly triple that recorded in the first quarter.

This means that the non-consumer part of the US economy subtracted 1.6% from GDP growth in the second quarter. In fact, as Deutsche Bank calculates, on an annual basis, the non-consumer portion of the economy is shrinking, i.e., in a recession, not only in real terms but also in nominal terms.

Read more …

More parts of Stockman’s upcoming book ‘Trumped’.

US Government Entitlements – Sixth Biggest Economy On Earth (Stockman)

……..Because the main street economy is failing, the nation’s entitlement rolls have exploded. About 110 million citizens now receive some form of means tested benefits. When social security is included, more than 160 million citizens get checks from Washington. The total cost is now $3 trillion per year and rising rapidly. America’s entitlements sector, in fact, is the sixth biggest economy in the world. Yet in a society that is rapidly aging to the tune of 10,000 baby boom retirees per day, this 50% dependency ratio is not even remotely sustainable. As we show in a later chapter, social security itself will be bankrupt within 10 years. Still, there is another even more important aspect of the mainstream narrative’s absolute radio silence about the monumental entitlements problem.

Like in the case of the nation’s 30-year LBO, the transfer payments crisis is obfuscated by the economic blind spots of our Keynesian central banking regime. Greenspan, Bernanke, Yellen and their posse of paint-by-the-numbers economic plumbers have deified the great aggregates of consumer, business and government spending as the motor force of economic life. As more fully deconstructed below, however, this boils down to a primitive notion of bathtub economics. In this bogus economic model, it is assumed that the supply-side of the economy is always fully endowed or even over-provided. By contrast, the perennial problem is purportedly a shortfall of an ether called “aggregate demand”.

Read more …

Can we please stop talking about it, and do it already?

Helicopter Money Talk Takes Flight As Bank of Japan Runs Out Of Runway (R.)

In the narrowest sense, a government can arrange a helicopter drop of cash by selling perpetual bonds, which never need to be repaid, directly to the central bank. Economists do not expect this in Japan, but they do see a high chance of mission creep, with the BOJ perhaps committing to buy municipal bonds or debt issued by state-backed entities, giving its interventions more impact than in the treasury bond market, where it is currently buying 80 trillion yen a year of Japanese government bonds (JGBs) from financial institutions. “Compared with government debt, these assets have low trading volume and low liquidity, so BOJ purchases stand a high chance of distorting these markets,” said Shinichi Fukuda, a professor of economics at Tokyo University.

“Prices would have an upward bias, so even if the BOJ bought at market rates, this would be considered close to helicopter money.” Other options include creating a special account at the BOJ that the government can always borrow from, committing to hold a certain%age of outstanding government debt or buying corporate bonds, economists say. With the BOJ’s annual JGB purchases already more than twice the volume of new debt issued by the government, Japan has already adopted something akin to helicopter money, said Etsuro Honda, a former special adviser to the Cabinet and a key architect of Abe’s reflationary economic policy. But it has not been enough to stop consumer prices falling in June at their fastest since the BOJ began quantitative easing in 2013.

Read more …

And these are half-ass stress tests designed to let banks pass.

No Clean Bill Of Health For EU Banks In Stress Test (R.)

Banks from Italy, Ireland, Spain and Austria fared worst in the latest European Union stress test, which the region’s banking watchdog said on Friday showed there was still work to do in order to boost credit to the bloc’s economy. Eight years since the collapse of Lehman Brothers sparked a global banking meltdown, many of Europe’s banks are still saddled with billions of euros in poorly performing loans, crimping their ability to lend and putting off investors. “While a number of individual banks have clearly fared badly, the overall finding of the European Banking Authority – that Europe’s banks are resilient to another crisis – is heartening,” Anthony Kruizinga at PwC said. Italy’s Monte dei Paschi, Austria’s Raiffeisen, Spain’s Banco Popular and two of Ireland’s main banks came out with the worst results in the EBA’s test of 51 EU lenders.

“Whilst we recognize the extensive capital raising done so far, this is not a clean bill of health,” EBA Chairman Andrea Enria said in a statement. “There remains work to do.” Italy’s largest lender, UniCredit, was also among those banks which fared badly, and it said it will work with supervisors to see if it should take further measures. Germany’s biggest banks, Deutsche Bank and Commerzbank, were also among the 12 weakest banks in the test, along with British rival Barclays. Monte dei Paschi, Italy’s third largest lender, had been scrambling to pull together a rescue plan and win approval for it from the ECB ahead of the test results. The Italian bank confirmed less than an hour before the results that it had finalised a plan to sell off its entire portfolio of non-performing loans and had assembled a consortium of banks to back a €5 billion capital increase.

Read more …

More!

Ireland Jails Three Top Bankers Over 2008 Banking Meltdown (R.)

Three senior Irish bankers were jailed on Friday for up to three-and-a-half years for conspiring to defraud investors in the most prominent prosecution arising from the 2008 banking crisis that crippled the country’s economy. The trio will be among the first senior bankers globally to be jailed for their role in the collapse of a bank during the crisis. The lack of convictions until now has angered Irish taxpayers, who had to stump up €64 billion – almost 40% of annual economic output – after a property collapse forced the biggest state bank rescue in the euro zone. The crash thrust Ireland into a three-year sovereign bailout in 2010 and the finance ministry said last month that it could take another 15 years to recover the funds pumped into the banks still operating.

Former Irish Life and Permanent Chief Executive Denis Casey was sentenced to two years and nine months following the 74-day criminal trial, Ireland’s longest ever. Willie McAteer, former finance director at the failed Anglo Irish Bank, and John Bowe, its ex-head of capital markets, were given sentences of 42 months and 24 months respectively. All three were convicted of conspiring together and with others to mislead investors, depositors and lenders by setting up a €7.2 billion circular transaction scheme between March and September 2008 to bolster Anglo’s balance sheet. Irish Life placed the deposits via a non-banking subsidiary in the run-up to Anglo’s financial year-end, to allow its rival to categorize them as customer deposits, which are viewed as more secure, rather than a deposit from another bank.

Read more …

“..a couple of generations of Australians will be all the poorer for it…”

Australia’s Property Market Is Completely Bonkers (Schwab)

House prices are no longer a function of value but rather of how much people are prepared to pay. That in turn is determined by how much banks are willing to lend. And that amount continues to rise. Before the current boom started in 1997, the ratio of household debt to GDP was around 40% — it’s now more than 100% (it’s the same story for household income to household debt). In short, the banks are lending Australians a whole load of cash, and we’re using that cash to bid up the price of an unproductive asset (established housing).

The removal of housing prices from reality is almost total. Most investment advisers will tell you that the price of an asset is dependent on the income that asset generates. For example, the more a company earns (or more specifically, the more investors think that company will earn in the future), the higher its share price will rise. Given house and apartment prices are currently high (based on their terrible net rental yield) one would expect rents to be increasing significantly to justify their price. However, the data tells a very different story. CoreLogic found that Australian dwellings increased in price by 10% in the past year. In Sydney and Melbourne the price rises were even more significant, with Sydney increasing by 13% and Melbourne by 13.9%.

If the market had any degree of rationality, given the market is already expensive, rentals would have needed to rise by around 20% during the year to justify those price increases. However, CoreLogic also reported that Sydney rents were up a mere 0.4% and Melbourne up by 1.7% (both well below the inflation rate). That means if the market was insane a year ago, it’s even worse now. Already overprice property is increasing, in Sydney’s case, 20 times as fast as underlying income. The problem is no one seems to care what the banks do (least of all the government, even though taxpayers are on the hook if any of the big banks fall over, which if the history of banking is anything to go by is a virtual certainty at some point).

Moreover, successive governments’ taxation policies (negative gearing, no capital gains tax, minimal land tax) serve to exacerbate the insanity. How long will the boom last? Potentially some time. There are a lot of vested interests (banks, real estate industry, state governments, the media) who are utterly reliant on the bubble continuing. Sadly, a couple of generations of Australians will be all the poorer for it.

Read more …

“Economic stability breeds instability. Periods of prosperity give way to financial fragility. With overleveraged banks and no-money-down mortgages still fresh in the mind after the global financial crisis, Minsky’s insight might sound obvious.”

Minsky’s Moment (Economist)

Minsky distinguished between three kinds of financing. The first, which he called “hedge financing”, is the safest: firms rely on their future cashflow to repay all their borrowings. For this to work, they need to have very limited borrowings and healthy profits. The second, speculative financing, is a bit riskier: firms rely on their cashflow to repay the interest on their borrowings but must roll over their debt to repay the principal. This should be manageable as long as the economy functions smoothly, but a downturn could cause distress. The third, Ponzi financing, is the most dangerous. Cashflow covers neither principal nor interest; firms are betting only that the underlying asset will appreciate by enough to cover their liabilities. If that fails to happen, they will be left exposed.

Economies dominated by hedge financing—that is, those with strong cashflows and low debt levels—are the most stable. When speculative and, especially, Ponzi financing come to the fore, financial systems are more vulnerable. If asset values start to fall, either because of monetary tightening or some external shock, the most overstretched firms will be forced to sell their positions. This further undermines asset values, causing pain for even more firms. They could avoid this trouble by restricting themselves to hedge financing. But over time, particularly when the economy is in fine fettle, the temptation to take on debt is irresistible. When growth looks assured, why not borrow more? Banks add to the dynamic, lowering their credit standards the longer booms last.

If defaults are minimal, why not lend more? Minsky’s conclusion was unsettling. Economic stability breeds instability. Periods of prosperity give way to financial fragility. With overleveraged banks and no-money-down mortgages still fresh in the mind after the global financial crisis, Minsky’s insight might sound obvious. Of course, debt and finance matter. But for decades the study of economics paid little heed to the former and relegated the latter to a sub-discipline, not an essential element in broader theories. Minsky was a maverick. He challenged both the Keynesian backbone of macroeconomics and a prevailing belief in efficient markets.

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Yanis calling for heads to roll.

The IMF Confesses It Immolated Greece On Behalf Of The Eurogroup (YV)

[..] an urgent apology is due to the Greek people, not just by the IMF but also by the ECB and the Commission whose officials were egging the IMF on with the fiscal waterboarding of Greece. But an apology and a collective mea culpa from the troika is woefully inadequate. It needs to be followed up by the immediate dismissal of at least three functionaries. First on the list is Mr Poul Thomsen – the original IMF Greek Mission Chief whose great failure (according to the IMF’s own reports never before had a mission chief presided over a greater macroeconomic disaster) led to his promotion to the IMF’s European Chief status.

A close second spot in this list is Mr Thomas Wieser, the chair of the EuroWorkingGroup who has been part of every policy and every coup that resulted in Greece’s immolation and Europe’s ignominy, hopefully to be joined into retirement by Mr Declan Costello, whose fingerprints are all over the instruments of fiscal waterboarding. And, lastly, a gentleman that my Irish friends know only too well, Mr Klaus Masuch of the ECB. Finally, and most importantly, the apology and the dismissals will count for nothing if they are not followed by a complete U-turn over macroeconomic, fiscal and reform policies for Greece and beyond.

Is any of this going to happen? Or will the IMF’s IEO report light up the sky fleetingly, to be forgotten soon? The omens are pointing to the latter. In which case, the EU’s chances of regaining the confidence of its citizens, chances that are already too slim, will run through our leaders’ fingers like thin, white sand.

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“..the shift into an era of post-truth politics…”

Econocracy Has Split Britain Into Experts And Ordinary People (G.)

During the EU referendum debate almost the whole global economic and financial establishment lined up to warn of the consequences of Brexit, and yet 52% of the country ignored them. For many Remain voters it is a clear sign of the shift into an era of post-truth politics. While economists developed rigorous, evidence-based arguments, Leave campaigners slandered experts and appeared to pluck numbers out of the air. Yet they won. Post-truth politics is indeed a scary prospect but to avoid such a future we cannot simply blame “populist politicians” or “ill-informed voters”. We must understand the referendum in its wider context; economists must realise that they are both part of the problem and a necessary part of the solution. We are living in an econocracy.

Such a society seems like a democracy, with political parties and elections, but political goals are expressed in terms of their effect on “the economy”, and economic policymaking is viewed as a technical, not a political, activity. Areas of political life are increasingly delegated to experts, whether at the Bank of England, the government’s behavioural insights team, the Competition Commission or the Treasury. As members of Rethinking Economics, an international student movement seeking to reform the discipline of economics, we are campaigning for a more pluralist, critical and participatory approach. We conduct workshops in schools, run evening crash courses for adults, and this year launched Economy, a website providing accessible economic analysis of current affairs and a platform for lively public debate.

We want economists and citizens to join us in our mission to democratise economics. That’s because the language of economics has become the language of government, and as the experts on “the economy”, economists have secured a position of prestige and authority. Their rise has gone hand in hand with the increasing importance over the 20th century and beyond of the idea of the economy in political and social life. This idea in its modern use took hold only in the 1950s but today GDP growth is one of the central indicators of success for governments, and it is unheard of for a political party to win a general election without being viewed as competent on the economy.

We have also seen the economisation of daily life, so that parts of society as diverse as the arts and healthcare now justify their value in terms of their contribution to the economy. But in this process economists have largely ignored citizens and failed to consider their right to participate in discussion and decision-making.

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A bunch of dangerous sickos.

Network Close To NATO Military Leader Fueled Ukraine Conflict (Spiegel)

The newly leaked emails reveal a clandestine network of Western agitators around the NATO military chief, whose presence fueled the conflict in Ukraine. Many allies found in Breedlove’s alarmist public statements about alleged large Russian troop movements cause for concern early on. Earlier this year, the general was assuring the world that US European Command was “deterring Russia now and preparing to fight and win if necessary.” The emails document for the first time the questionable sources from whom Breedlove was getting his information. He had exaggerated Russian activities in eastern Ukraine with the overt goal of delivering weapons to Kiev. The general and his likeminded colleagues perceived US President Barack Obama, the commander-in-chief of all American forces, as well as German Chancellor Angela Merkel as obstacles.

Obama and Merkel were being “politically naive & counter-productive” in their calls for de-escalation, according to Phillip Karber, a central figure in Breedlove’s network who was feeding information from Ukraine to the general. “I think POTUS sees us as a threat that must be minimized,… ie do not get me into a war????” Breedlove wrote in one email, using the acronym for the president of the United States. How could Obama be persuaded to be more “engaged” in the conflict in Ukraine – read: deliver weapons – Breedlove had asked former Secretary of State Colin Powell. Breedlove sought counsel from some very prominent people, his emails show. Among them were Wesley Clark, Breedlove’s predecessor at NATO, Victoria Nuland, the assistant secretary of state for European and Eurasian affairs at the State Department, and Geoffrey Pyatt, the US ambassador to Kiev.

One name that kept popping up was Phillip Karber, an adjunct assistant professor at Georgetown University in Washington DC and president of the Potomac Foundation, a conservative think tank founded by the former defense contractor BDM. By its own account, the foundation has helped eastern European countries prepare their accession into NATO. Now the Ukrainian parliament and the government in Kiev were asking Karber for help. On February 16, 2015, when the Ukraine crisis had reached its climax, Karber wrote an email to Breedlove, Clark, Pyatt and Rose Gottemoeller, the under secretary for arms control and international security at the State Department, who will be moving to Brussels this fall to take up the post of deputy secretary general of NATO.

Karber was in Warsaw, and he said he had found surreptitious channels to get weapons to Ukraine – without the US being directly involved. According to the email, Pakistan had offered, “under the table,” to sell Ukraine 500 portable TOW-II launchers and 8,000 TOW-II missiles. The deliveries could begin within two weeks. Even the Poles were willing to start sending “well maintained T-72 tanks, plus several hundred SP 122mm guns, and SP-122 howitzers (along with copious amounts of artillery ammunition for both)” that they had leftover from the Soviet era. The sales would likely go unnoticed, Karber said, because Poland’s old weapons were “virtually undistinguishable from those of Ukraine.”

Read more …

What Trump said.

America’s Military Is “Lender Of Last Resort” (Cate Long)

America is slowly awakening from its long debt-induced slumber. It has conducted two major wars, a bailout of banks and a major stimulus program without raising taxes to pay for them. Because the Federal Reserve kept interest rates low, it was easy for politicians to continue to raise the debt ceiling and spend without making reductions in other areas of the budget. But those days have ended, the punch bowl has been removed and a new sobriety has rolled into our national capital. Even with its massive deficit problems, America has been providing security for its global allies for decades at no cost to them.

This resulted in spending 4.8% of GDP on U.S. military in 2010, which was ramped up from 3.0% in 2001, according to the Stockholm International Peace Research Institute. In contrast, you can see that European countries spent 1.73% of total GDP on military in 2010, which declined slightly from 1.99% in 2001. America has been subsidizing European military needs largely due to its role in the NATO alliance. The Council on Foreign Relations explains the new problems with this arrangement:

In 2011, then Secretary of Defense Robert Gates warned that ‘there will be dwindling appetite and patience in the U.S. . . . to expend increasingly precious funds on behalf of nations that are apparently unwilling to devote the necessary resources to be serious and capable partners in their own defense.’ France in Mali is now a case in point; the Obama administration is providing only grudging assistance to an under-resourced French intervention.

[…] French military spending…has since 2001 exhibited a marked constancy—one which is inconsistent with the country’s newfound passion for military engagement. (Libya in March 2011 was another example of the French, as well as British, military biting off more than it could chew). It also highlights the need for the Obama administration to address Gates’ prescient concern and to develop a clearer policy foundation for America’s global military ‘lender of last resort’ role.

America is woefully underfunded in infrastructure spending and many other social needs. A big question is whether it can also be the global military “lender of last resort” and still maintain its own house. The military contracting industry in America does create a lot of jobs, but in essence it also gives the benefits away free to its allies. Times must change. America must either charge for these services or understand more clearly what we gain from continued military involvement overseas.

Read more …

Nov 092015
 
 November 9, 2015  Posted by at 1:33 pm Finance Tagged with: , , , , , , , ,  7 Responses »


Giles Duley Afghan boy lands on Lesvos Nov 2015

German Chancellor Angela Merkel needs to do something, urgently, that should have been done months- if not more- ago. There has to be a UN emergency summit on the European refugee crisis, it has to involve leaders at the very highest levels, and it has to take place within weeks at the latest. Or else.

Of course any leader could call for the summit, and if Merkel waits too long -as she is wont to do- someone else should. But she is the best person for the job. No-one else who leads an entire continent looks ready to take this on, and moreover it’s her own country that quite possibly faces the gravest consequences of the crisis.

That is to say, for now Germany still comes in way after Greece in that regard, but if Alexis Tsipras would attempt to call such a summit, his appeal would fall on deaf ears, and at best lead to lots of international Merkel-style diddling (or ‘Merkeln’, as the Germans put it). And there’s already been far too much of that.

The renewed urgency comes from a number of directions. First, the continuing drownings of refugees in the Aegean sea. The lack of urgency with which those drownings have been met has become a huge and immediate threat to Merkel, if only because the entire European project has already died with the babies washing up on the shores of Greece.

Even if it will take a long time for people to recognize that, given the ideological ‘union’ blindness that pervades Brussels and European capitals. Angela’s legacy risks being not only her responsibility for thousands of deaths, but also the very demise of the EU. And that’s just for starters.

Secondly, It was Merkel herself last week who warned of renewed military conflicts in the Balkans if the approach to the refugee crisis wouldn’t change, and rapidly.

According to Merkel, if Balkan countries -continue to- build fences and razor wire barriers at their borders, one after the other, some countries risk ‘getting stuck’ with huge numbers of refugees on their territories that they are not in the least prepared for. Which makes Friday’s German announcement, mere days after Merkel’s warning, all the more ominous:

Germany Imposes Surprise Curbs On Syrian Refugees

Angela Merkel has performed an abrupt U-turn on her open-door policy towards people fleeing Syria’s civil war, with Berlin announcing that the hundreds of thousands of Syrians entering Germany would not be granted asylum or refugee status. Syrians would still be allowed to enter Germany, but only for one year and with “subsidiary protection” which limits their rights as refugees. Family members would be barred from joining them.

[..] the interior minister, Thomas de Maiziere, announced that Berlin was starting to fall into line with governments elsewhere in the EU, who were either erecting barriers to the newcomers or acting as transit countries and limiting their own intake of refugees.

[..] the suddenness of the move by the country that has been pivotal in the EU’s biggest ever immigration crisis will ripple across the region with unknown consequences, particularly in the transit countries of the Balkans and central Europe through which hundreds of thousands have been trekking towards Germany.

The German curbs will encourage these countries to establish barriers of their own to the refugee wave. Merkel is also pressing countries such as Croatia, Slovenia, and Serbia to establish “reception centres” or camps where refugees can be processed and screened before they reach Germany. The countries are resisting because no one knows what to do with those who are screened and do not pass muster for passage to Germany.

Around the same time that Germany pressures Balkan countries to establish ‘reception centers’, it votes down plans for ‘transit zones’ on its own territory. Some are more equal than others? Berlin had better beware.

The third ‘urgency’, curiously downplayed by media and politics, comes in the shape of a warning by the EU itself, albeit “buried in a 204-page report on the future of the European economy”.

European Union Predicts 3 Million More Refugees By End Of Next Year

The European Union predicted Thursday that up to 3 million additional asylum seekers could enter the 28-member bloc by the end of next year, suggesting the staggering pace of new arrivals in recent months shows no sign of abating. The forecast, buried in a 204-page report on the future of the European economy..

The EU expects 3 million refugees in 2016. This year, there will be ‘only’ 1 million. Of which resettlement deals have been made for 160,000, and at last count 116 have actually been resettled. Somebody better start taking this serious, or it will get very terribly out of hand. And that’s not to say it hasn’t already, with well over 3000 refugees having drowned in the Mediterranean, hundreds of them children.

This is a humanitarian disaster that nobody’s willing to recognize as one, and that is exactly what has to stop. The reason why this prediction is hushed up across the board is of course obvious: the 1 million refugees in 2015 have already strained resources, international relationships and indeed entire governments to such an extent, wars could start just because of that.

Add another 3 million, and the chances of a peaceful 2016 in Europe grow terribly slim. But not talking about it will of course slim down those chances further. And even if the total of 4 million refugees expected by the end of next year will be less than 1% of the EU’s 500 million population, someone better do something fast, or else.

The fact that Europe risks being strained to the point of military conflict, and there’s precious little reason to doubt Angela Merkel’s assessment of the situation, means that what needs to be done is to make the entire world aware that this is a global issue, not a regional one. And that’s where the UN emergency summit comes in.

Obviously, Germany is overwhelmed right now. But doing a U-turn on the open-door policy is not going to solve that problem. It will merely shift it, either within Germany itself, or towards the Balkan countries the refugees travel through to come to the Bundesrepublik.

Decision making by the EU Brussels has failed shamefully. And not only on the refugee crisis. But since Merkel is the no. 1 voice of power in Europe, that puts the shame on her as well. As we’ve said before, the only way to handle an issue such as this, is to put the people first.

You can’t let the people, the children, drown at random and expect to come away with your positions intact. And just because international politics these days focuses a lot on trying to deflect responsibilities by pointing to others, and to international bodies, blood on one’s hands doesn’t wash off easily, and in the end not at all.

Blaming the refugees themselves, as the head of EU border agency Frontex attempted once again by labeling them , is as useless as it is disgraceful. People fleeing war zones to save their lives are not ‘illegals’.

Blaming the ‘smugglers’, an even more popular EU pastime, makes no sense either. If the smugglers were Europe’s biggest concern, it would grant safe passage to refugees. That would stop ‘smuggling’ in one fell swoop. But it would demand a level of political courage that nobody, not Merkel either, possesses.

What drives policies across the board still comes down to the prevailing wish, fed to European populations by media and politics, to keep things as they are. To maybe invite the token refugee, but to prevent sudden or large changes in the society people happen to live in.

And while that may be understandable, it doesn’t mean it’s always realistic. Sometimes change is inevitable. We may find it easier to accept that when it comes to earthquakes and hurricanes than in the case of mass migrations, but all of these are regular occurrences throughout history. In the end, all we can do is make the best of it, in the most humane way we know of, or descend into mayhem.

One more thing that needs repeating time and again though politicians won’t like it: Europe’s leadership knew the refugee problem was coming. Angela Merkel was warned by her Bundespolizei at least eight months ago, but there were warnings even way before that. Everyone just chose to ignore them.

Refugee Crisis Was Not Unexpected, Top UN Official Says

Director-General of the United Nations office in Geneva, Denmark’s Michael Moller: [..] “The crisis we have today, we knew it was going to happen. The leaders of Europe were told it was going to happen at least two years ago.”

[..] there will be even greater problems, unless we sit down globally and figure out structures and ways to deal with this in the future. Not to reinvent the wheel every time that happens, but to rethink completely and strengthen the humanitarian system, because I guarantee you that it will happen again.

Moller say the same thing I do: “we need to sit down globally”. He doesn’t provide a timeframe, but between the lines it’s clear he doesn’t think either that there’s time to waste. A UN emergency summit may be all that stands between us and ‘anarchy’, in one way and shape or the other.

This summit must include the presidents and prime ministers of all major nations (and please leave out the EU). Obama, Putin, Xi Jinping and Merkel, but also the leaders of Greece, Turkey, Jordan, Lebanon (where the majority of Syrian refugees are) and all Balkan countries. Countries like Canada, Brazil and Australia can and must be called upon to grant asylum to many more refugees than they do now.

In this week’s issue of the New Yorker, George Packer describes how America took in more than a million refugees from South East Asia in one year 35 years ago, and how it can and should make such an effort once more:

America’s Apathy About The Syrian Refugees

[..].. the U.S. has accepted fewer than two thousand Syrians. In September, President Obama announced an increase in the quota for the coming year to ten thousand. That figure represents just half the monthly total of Indochinese refugees brought here in 1980. One refugee advocate called it “an embarrassingly low number.” And yet even this humble goal is unlikely to be reached.

The world has a narrow window left to prevent an already grave humanitarian disaster into something much worse, to prevent antagonism and military action that will set loose the evil genies of the Pandora’s box that is Europe’s past, once again, and genies of surrounding regions too. There is no need for that. Not yet.

The world, united in such a summit, must also look beyond the refugee crisis, and, as the UN’s Moller says, “rethink completely and strengthen the humanitarian system”. Because there are other dangers on the horizon, potentially much worse. Climate refugees are an obvious one, but even more, there’s the economic downturn nobody seems to be willing to acknowledge (at their own peril).

As I wrote a week ago, in an article quoted by Zero Hedge on Wednesday in their piece on German opposition parties warning of a domestic civil war:

Europe Will Never Be The Same; Neither Will The World

Ignorance and denial threatens to lead to a needless increase in nationalism, fascism, violence, misery, death and warfare. If we were to acknowledge that the change is inevitable, and prepare ourselves accordingly, much of this could be avoided.

There are two main engines of change that have started to transform the Europe we think we know. First, a mass migration spearheaded by the flight of refugees from regions in the world which Europeans have actively helped descend into lethal chaos. Second, an economic downturn the likes of which hasn’t been seen in 80 years or so (think Kondratieff cycle).

Negative ideas about refugees are already shaping everyday opinion and politics in many places, and this will be greatly exacerbated by the enormous economic depression that for now remains largely hidden behind desperate sleight-of-hands enacted by central bankers, politicians and media.

There are fine theories around coming from fine people, on how refugees can benefit a host country’s economic systems. But they are the kind of people who are perpetually looking at economic growth. And no such growth is guaranteed – to put it awfully mildly.

Therefore, it doesn’t really matter to the issue if refugees do or do not contribute ‘positively’ to a country’s economics, because all countries are facing a giant slowdown and depression caused by an inevitable debt deflation. And that makes it all the more urgent for people, and societies, to be prepared for all possible outcomes, including worst case scenarios.

The depression is guaranteed, and so are millions more people fleeing the ruins that were ones their homes, and their hopes for a decent future for their children.

Every day that Merkel loses in calling this highest-level, highest-urgency, UN summit, is a day that more people will drown. And that means one more day that we all will lose more of our own humanity, and of our claims for others to show us theirs.

In our own way, we’re all already drowning and washing up devoid of life, and of human values, somewhere on a cold and lonely distant beach.

Oct 282015
 
 October 28, 2015  Posted by at 9:35 am Finance Tagged with: , , , , , , , , , ,  8 Responses »


Lewis Wickes Hine Newsies Gus Hodges, 11, and brother Julius, 5, Norfolk VA 1911

Weak US Business Spending Plans Point To Slower Economic Growth (Reuters)
Chinese Consumer Sentiment Indicator Slumps In October (CNBC)
Japan’s Retail Sales Fall Piles Pressure On Bank of Japan (CNBC)
China Steel Head Says Demand Slumping at Unprecedented Speed (Bloomberg)
Why Don’t We Save Our Steelworkers The Way We Saved Bankers? (Chakrabortty)
In China’s Alleyways, Underground Banks Move Money (WSJ)
Where Are My (Business Cycle) Dragons? (FT)
Fossil Fuel Companies Risk Plague Of Climate Change Lawsuits (AEP)
US Plans to Sell Down Strategic Oil Reserve to Raise Cash (Bloomberg)
VW Posts $3.85 Billion Quarterly Loss, First In 15 Years (Bloomberg)
Canada Can Show That Ending Austerity Makes Sense (Paul Krugman)
EU Net Neutrality Laws Fatally Undermined By Loopholes (Guardian)
Territorial Disputes: The South China Sea (Bloomberg)
US to Begin ‘Direct Action on the Ground’ in Iraq, Syria (NBC)
IMF Paints Gloomy Outlook For Sub-Saharan Africa (Reuters)
Children Hardest Hit By Europe’s Economic Crisis (Reuters)
The End Of Visa-Free Travel In Europe May Be Looming (Bloomberg)
Migrant Crisis Could Prompt EU to Loosen Budget Deficit Rules (WSJ)
Slovenia Considers Calling For EU Military Aid (FT)
The Children’s Feet Are Rotting, In 1 Month All These People Will Be Dead (HP)
So Long And Thanks For All The Poo (WaPo)

Deflation in the US…

Weak US Business Spending Plans Point To Slower Economic Growth (Reuters)

A gauge of U.S. business investment plans fell for a second straight month in September, pointing to a sharp slowdown in economic growth and casting more doubts on whether the Federal Reserve will raise interest rates this year. Other data on Tuesday showed consumer confidence slipped this month amid worries over a recent moderation in job growth and its potential impact on income. Housing, however, remains the bright spot, with home prices accelerating in August. That should boost household wealth, supporting consumer spending and the broader economy, which has been buffeted by a strong dollar, weak global demand, spending cuts in the energy sector and efforts by businesses to reduce an inventory glut.

The continued weakness in business spending, together with the slowdown in hiring, could make it difficult for the Fed to lift its short-term interest rate from near zero in December, as most economists expect. The U.S. central bank’s policy-setting committee started a two-day meeting on Tuesday. “The drift of data suggests that the first time the Fed will raise rates will be in the spring,” said Steve Blitz, chief economist at ITG Investment Research in New York. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, slipped 0.3% last month after a downwardly revised 1.6% decline in August, the Commerce Department said. These so-called core capital goods were previously reported to have dropped 0.8% in August.

The data was the latest dour news for manufacturing, which has borne the brunt of dollar strength, energy sector investment cuts and the inventory correction. Manufacturing accounts for 12% of the economy. In a separate report, the Conference Board said its consumer sentiment index fell to 97.6 this month from a reading of 102.6 in September. Consumers were less optimistic about the labor market, with the share of those anticipating more jobs in the months ahead slipping. There was a drop in the proportion of consumers expecting their incomes to increase and more expected a drop in their income. The downbeat assessment of the labor market follows a step down in job growth in August and September.

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…and in China…

Chinese Consumer Sentiment Indicator Slumps In October (CNBC)

Consumer sentiment in China plunged in October, as the outlook for business conditions plummeted and household finances weakened, a survey showed Wednesday. The Westpac MNI China Consumer Sentiment Indicator fell to 109.7 in October from 118.2 in September, marking the lowest reading since the survey began in 2007. Business outlook over the coming year was the hardest hit, with Business Conditions in One Year registering a 10.3% decline, while the Business Conditions in Five Years component fell 8.2%. Current and expected measures for household finances were also weaker, down 5.3% and 7.3% respectively. The survey is taken from consumers across 30 Chinese cities ranging from tier 1 to tier 3.

Respondents said that they were planning on reducing their shopping and entertainment activities in the near term. “This result openly questions the resilience of the Chinese consumer to the discouraging state of the real economy,” said Huw McKay, senior international economist at Westpac. The survey follows China’s gross domestic product release last week, which showed the world’s second largest economy grew by 6.9% in the three months through September, the slowest pace since 2009. Concerns over the health of the Chinese economy have spilled from Chile to Korea, sparking a sharp sell-off in the price of commodities that Chinese factories traditionally consume in hefty amounts, as well as the currencies of the countries that benefit from selling raw materials to China.

[..] The drop in confidence was most acute among in the 35-to-54-year-old group, with sentiment plunging 11.2% between September and October. In contrast, confidence among the youngest and oldest age cohorts (18-34 and 55-64) declined more moderately by 3.3% and 3.2% respectively, Wesptac said in a statement.

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…and in Japan too..

Japan’s Retail Sales Fall Piles Pressure On Bank of Japan (CNBC)

Japan’s retail sales unexpectedly fell on-year in September, official data showed on Wednesday, suggesting that consumer spending does not the momentum to make up for weak exports and factory output. The retail sales news could add to pressure on the Bank of Japan under to expand monetary stimulus, possibly as soon as its rate review meeting on Friday, when it is also expected to slash its rosy economic and price projections, analysts say. Retail sales fell 0.2% in September from a year earlier, compared with economists’ median estimate for a 0.4% rise, the Ministry of Economy, Trade and Industry said on Wednesday.

The decline, which followed five straight months of gains, was largely due to sluggish demand for cars and fuel, according to the data. On a seasonally adjusted basis, retail sales rose 0.7% in September from the previous month. Japan’s economy shrank in April-June and may suffer another contraction in July-September on weak exports and consumption. Analysts say any rebound in the current quarter will be modest as companies feel the pinch from soft demand in China and other emerging Asian markets.

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…and it’s not just consumers, it’s spending across the board.

China Steel Head Says Demand Slumping at Unprecedented Speed (Bloomberg)

If anyone doubted the magnitude of the crisis facing the world’s largest steel industry, listening to Zhu Jimin would put them right, fast. Demand is collapsing along with prices, banks are tightening lending and losses are stacking up, the deputy head of the China Iron & Steel Association said on Wednesday. “Production cuts are slower than the contraction in demand, therefore oversupply is worsening,” said Zhu at a quarterly briefing in Beijing by the main producers’ group. “Although China has cut interest rates many times recently, steel mills said their funding costs have actually gone up.” China’s mills – which produce about half of worldwide output – are battling against oversupply and sinking prices as local consumption shrinks for the first time in a generation amid a property-led slowdown.

The fallout from the steelmakers’ struggles is hurting iron ore prices and boosting trade tensions as mills seek to sell their surplus overseas. Shanghai Baosteel Group forecast last week that China’s steel production may eventually shrink 20%, matching the experience seen in the U.S. and elsewhere. “China’s steel demand evaporated at unprecedented speed as the nation’s economic growth slowed,” Zhu said. “As demand quickly contracted, steel mills are lowering prices in competition to get contracts.” Medium- and large-sized mills incurred losses of 28.1 billion yuan ($4.4 billion) in the first nine months of this year, according to a statement from CISA. Steel demand in China shrank 8.7% in September on-year, it said.

Signs of corporate difficulties are mounting. Producer Angang Steel warned this month it expects to swing to a loss in the third quarter on lower product prices and foreign-exchange losses. The company’s Hong Kong stock has lost more than half its value this year. Last week, Sinosteel, a state-owned steel trader, failed to pay interest due on bonds maturing in 2017. Crude steel output in the country fell 2.1% to 608.9 million tons in the first nine months of this year, while exports jumped 27% to 83.1 million tons, official data show. Steel rebar futures in Shanghai sank to a record on Wednesday as local iron ore prices fell to a three-month low.

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Because there’s a huge global steel oversupply?

Why Don’t We Save Our Steelworkers The Way We Saved Bankers? (Chakrabortty)

Every so often a society decides which of its citizens really matter. Which ones get the star treatment and the big cash handouts – and which get shoved to the bottom of the pile and penalised. These are the big, rough choices post-crash Britain is making right now. A new hierarchy is being set in place by David Cameron in budget after austerity budget. Wealthy pensioners: winners. Young would-be homeowners: losers. Millionaires see their taxes cut to 45%, while the working poor pay a marginal tax rate of 80%. Big business gets to write its own tax code; benefit claimants face harsh sanctions. When the contours of this new social order are easy to spot, they can cause public uproar – as with the cuts to tax credits. Elsewhere, they’re harder to pick out, though still central. It is into this category that the crisis in the British steel industry falls.

It would be easy to tune out the past few weeks’ headlines about plant closures and job losses as just another story of business disaster. But what’s happening to our steelworkers, and what we do to protect them, goes to the heart of the debate about which people – and which places – count in Britain’s political economy. If Westminster lets the UK’s steel industry die, it’s in effect declaring that certain regions and the people who live and work in them are surplus to requirements. That it really doesn’t matter if Britain makes things. That the phrase “skilled working-class jobs” is now little more than an oxymoron. That’s the criteria against which to judge MPs, as they continue to take evidence today on the crisis and then debate options.

What does this crisis look like? Imagine coming to work on a September morning – only to find that you and one in six other employees in your entire industry face redundancy before Christmas. That’s the prospect facing British steelworkers. Motherwell, Middlesbrough, Scunthorpe: some of the most kicked-about places in de-industrialised Britain now face more punishment. Mothball the SSI plant in Redcar and it’s not just 2,200 workers that you send to the dole office and whose families you shove on the breadline. An entire local economy goes on life support: the suppliers of parts, the outside engineers who used to do the servicing, the port workers and hauliers, the cafes and shops. Within days of SSI’s closure, one of Teeside’s biggest employment agencies went into liquidation.

[..] Britain is entering the early stages of yet another industrial catastrophe. It could finally sink a sector, steel, that actually helps reduce the country’s gaping trade deficit. With that will go another pocket of well-paid blue-collar jobs. Chuck in employer contributions to pensions and national insurance, and the total remuneration per SSI staffer is £40,000 a year. Just try getting such pay in a call centre or distribution warehouse, even as a manager. Imagine what would happen if manufacturing were centred around the capital, and its executives had Downing Street on speed dial. Actually, you needn’t imagine – merely remember the meltdown of 2008. Then Gordon Brown was so desperate to save the City that the IMF estimates he propped it up with £1.2 trillion of public money. That’s the equivalent of nearly £20,000 from every man, woman and child in the country doled out to bankers in direct cash, loans and taxpayer guarantees.

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Try ten times that: “..central-bank officials who attempt to say that underground banks handle about 800 billion yuan ($125 billion) annually..”

In China’s Alleyways, Underground Banks Move Money (WSJ)

In a warren of tiny shops beneath grimy residential towers, a white-haired man selling Snickers bars and fizzy drinks from a kiosk no larger than a cashier’s booth is figuring out a way to move $100,000 out of China. That is twice what Chinese are allowed to send out of the country in a year. Licensed banks won’t do it. But middlemen like Mr. Chen, perched in his mini-mart at the front lines of a vast underground currency-exchange and offshore-remittance network, can and often will. “There’s never a certainty that these things can be done,” said Mr. Chen, who declined to give his full name. “But, usually, when things get stricter, the fee will just be a bit higher.” Facing a turbulent stock market and a weakening economy, many Chinese are trying to move money offshore.

That spells business for operations that can end-run capital controls. No official data track the underground transfers, but central-bank officials who attempt to say that underground banks handle about 800 billion yuan ($125 billion) annually, and more than usual this year. One sign of unusually high activity in underground banks is a drop in China’s foreign-exchange reserves, an indicator of demand for hard currency. Reserves fell by a record $93.9 billion in August and $43 billion more in September, though part of the reason was central-bank selling to support the yuan. Often hidden behind the façades of convenience stores and tea shops, they cater to a clientele ranging from corrupt officials hiding gains to middle-class Chinese trying to buy overseas property.

All believe their money is safer abroad or can bring a higher return, a sentiment that has deepened since this summer’s stock-market plunge. New York real-estate agent Jiang Jinjin said she has handled nearly 2,000 residential-property purchases this year for Chinese families with children at Columbia University. “I didn’t sleep much this summer. Too many kids looking for apartments,” she said. Some customers rely on relatives and friends to carry cash over on repeated trips, she said, and some set up U.S. companies. Such firms can be used to overpay for imports, experts on underground banking say. Ms. Jiang said her company checks the provenance of money used to buy real estate.

The outflows have put underground bankers in China in the cross hairs of financial regulators. China’s capital controls were set up to keep funds onshore when the country was starved for investment. Officials consider them still necessary, to prevent sharp outflows of the kind that shocked developing economies in the 1997 Asian financial crisis. Also, too much cash going out could complicate efforts to stimulate growth through interest-rate cuts.

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Early understanding.

Where Are My (Business Cycle) Dragons? (FT)

The Qian Diagram implies a complete circulation with characteristics of contraction and expansion as well as phases of prosperity, recession, depression and recovery. The corresponding economic cycles are as follows: “Hidden Dragon. Do not act” refers to the economy that in a slump or depressed state in which it is hard to do anything; “Dragon appearing in the field” implies an economic recovery, in which successful people can take the opportunity to succeed; “The energetic gentlemen work hard all day” means keeping vigorous through the whole recovery phase, and no one can relax at any time. Being certain about the target and achieving it with effort and prudence, there will be no great harm even if in the face of risks; “Dragon wavering over the depths” refers to the phase from depression to recovery.

During this rising period, the average social profit rate is high and almost every business runs smoothly; “Flying dragon in the heavens” refers to the most economically prosperous period; “Arrogant dragon will have cause to repent” refers to recession in the economic cycle, which suggests things will develop in the opposite direction when they reach an extreme; “A flight of dragon without heads” indicates that in the prosperous period, monopoly will emerge, while after the economy enters recession, monopoly would disintegrate and be replaced instead by a pattern of free competition, which is a symbol of good performance for the economy.

[..] Guanzi is said to be the record of thoughts and remarks by Qi’s famous premier Guan Zhong and his School in the Spring and Autumn Period, which was between 475 B.C. and 221 B.C… Thought on demand management policy as well as fiscal and monetary policies is all covered in Guanzi. There are extensive discussions on the proper fiscal policy that should be undertaken during an economic depression in the Chapter Cheng Ma the sixty-ninth of Guanzi. “When people lose their fundamentals of living in years with frequent floods and droughts, the monarch can recruit those who live in extreme poverty and give them payment through the activities like constructing the palace. Therefore, the purpose of constructing pavilions is to appease national economic fluctuations rather than for enjoyment.” This is the earliest description of policy in Chinese history with characteristics of Keynesianism.

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Ambrose has a hobby horse.

Fossil Fuel Companies Risk Plague Of Climate Change Lawsuits (AEP)

Oil, gas and coal companies face the mounting risk of legal damages for alleged climate abuse as global leaders signal an end to business-as-usual and draw up sweeping plans to curb greenhouse gas emissions, Bank of America has warned. Investors in the City are increasingly concerned that fossil fuel groups and their insurers are on the wrong side of a powerful historical shift and could be swamped with exhorbitant class-action lawsuits along the lines of tobacco and asbestos litigation in the US. “It is setting off alarm bells that there could be these long tail risks,” said Abyd Karmali, Bank of America’s head of climate finance. Mr Karmali said the United Nations’ “COP21” climate summit in Paris in December is likely to be a landmark event that starts to shut the door on parts of the fossil industry.

“It is a non-exchangeable, one-way ticket to a low-carbon economy,” he said. Christiana Figueres, the UN’s top climate official, said 155 countries have already put forward detailed plans covering 88pc of global CO2 emissions, and others are expected to join before the deadline expires. “It is unstoppable. No amount of lobbying at this point is going to change the direction,” she told a Carbon Tracker forum in London. Mrs Figueres said the mood has changed entirely since the failed summit in Copenhagen in 2009. This time China is fully on board. “China is already spending more on renewables than any other country. It is going to introduce its own emissions trading scheme in 2017,” she said. Mrs Figueres said the pledges are not yet enough to cap the rise in average global temperatures to two degrees Centrigrade above pre-industrial levels by 2100 – the “two degree world” deemed the safe limit.

But the Paris accord does promise to “bend” the trajectory to 2.7 degrees and will almost certainly be followed by a series of deals that brings the ultimate target within sight. “We think most countries will be able to over-achieve,” she said. While the exact contours are still unclear, Paris is likely to sketch a way towards zero net emissions later this century. It implies that most fossil fuel reserves booked by major oil, gas and coal companies can never be burned. A deal would also send a moral signal with legal ramifications. Mark Carney, the Governor of the Bank England, warned last month that by those who had suffered losses from climate change may try to bring claims on third-party liability insurance. He specifically mentioned the parallel of asbestos claims in US courts, which have mounted over the years to $85bn and devastated some Lloyd’s syndicates.

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Like Gordon Brown selling England’s gold reserves. Timing is everything.

US Plans to Sell Down Strategic Oil Reserve to Raise Cash (Bloomberg)

The U.S. plans to sell millions of barrels of crude oil from its Strategic Petroleum Reserve from 2018 until 2025 under a budget deal reached on Monday night by the White House and top lawmakers from both parties. The proposed sale, included in a bill posted on the White House website, equates to more than 8% of the 695 million barrels of reserves, held in four sites along the Gulf of Mexico coast. Sales are due to start in 2018 at an annual rate of 5 million barrels, rising to 10 million by 2023 and totaling 58 million barrels by the end of the period. The proceeds will be “deposited into the general fund of the Treasury,” according to the bill. The sale is the second time the U.S. has raised cash from the reserve, created as a counter-balance to the power of Arab producers after the first oil crisis of 1973-74.

The U.S. may sell also additional barrels to cover a $2 billion program from 2017 to 2020 to modernize the strategic reserve, including building new pipelines. The White House on Tuesday urged lawmakers to support the budget deal, including the proposed partial sale of the SPR, saying it was “a responsible agreement that is paid for in a balanced way.” Supporters of the sale argue the U.S. doesn’t require such a big emergency reserve as rising domestic production on the back of the shale boom offsets the need for imports. Critics, including oil analysts and former U.S. energy officials, say using the underground reserve as a piggy bank makes it less effective in meeting its intended purpose: combating a “severe energy disruption.” What’s more, the government would be selling at a time when oil is unlikely to have recovered from its slump over the past 18 months.

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VW must cut investments. They might as well cut their entire diesel division.

VW Posts $3.85 Billion Quarterly Loss, First In 15 Years (Bloomberg)

Volkswagen AG, Europe’s largest automaker, posted a €3.48 billion operating loss for the third quarter, worse than analysts’ estimate of a €3.27 billion loss. The company made €3.23 billion profit in the third-quarter a year ago. The historic loss comes amid a widening global emissions scandal after it was revealed software was used to cheat official exhaust analysis checks. The company also announced it would cut its 2015 profit target, saying earnings before interest and tax would drop “significantly.”

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Afraid it’s too late now. Deflation comes first. Oil is down for the count. Next, watch real estate.

Canada Can Show That Ending Austerity Makes Sense (Paul Krugman)

Canadians were less caught up than the rest of us in the ideology of bank deregulation. As a result, Canada was spared the worst of the 2008 financial crisis. Which brings us to the issue of deficits and public investment. Here’s what the Liberal Party of Canada platform had to say on the subject: “Interest rates are at historic lows, our current infrastructure is aging rapidly, and our economy is stuck in neutral. Now is the time to invest.” Does that sound reasonable? It should because it is. We’re living in a world awash with savings that the private sector doesn’t want to invest and is eager to lend to governments at very low interest rates. It’s obviously a good idea to borrow at those low, low rates, putting those excess savings, not to mention the workers unemployed due to weak demand, to use building things that will improve our future. [..]

Since 2010 public investment has been falling as a share of GDP in both Europe and the US, and it’s now well below pre-crisis levels. Why? The answer is that in 2010 elite opinion somehow coalesced around the view that deficits, not high unemployment and weak growth, were the great problem facing policymakers. There was never any evidence for this view; after all, those low interest rates showed that markets weren’t at all worried about debt. But never mind – it was what all the important people were saying, and all that you read in much of the financial press. And few politicians were willing to challenge this orthodoxy. Those who should have stood up for public spending suffered a striking failure of nerve.

Britain’s Labour Party, in particular, essentially accepted Conservative claims that the nation was facing a fiscal crisis and was reduced to arguing at the margin about what form austerity should take. Even President Barack Obama temporarily began echoing Republican rhetoric about the need to tighten the government’s belt. And having bought into deficit panic, centre-left parties found themselves in an extremely weak position. Austerity rhetoric comes naturally to right-wing politicians, who are always arguing that we can’t afford to help the poor and unlucky (although somehow we’re able to afford tax cuts for the rich). Centre-left politicians who endorse austerity, however, find themselves reduced to arguing that they won’t inflict quite as much pain. It’s a losing proposition, politically as well as economically.

Now come Justin Trudeau’s Liberals, who are finally willing to say what sensible economists have been saying all along. And they weren’t punished politically – on the contrary they won a stunning victory. So will the Liberals put their platform into practice? They should. Interest rates remain incredibly low: Canada can borrow for 10 years at only 1.5%, and its 30-year inflation-protected bonds yield less than 1%. Furthermore, Canada is probably facing an extended period of weak private demand thanks to low oil prices and the likely deflation of a housing bubble. Let’s hope, then, that Trudeau stays with the programme. He has an opportunity to show the world what truly responsible fiscal policy looks like.

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“.. its cut-down nature has prompted the web’s inventor, Tim Berners-Lee, to advise people to “just say no” to it.”

EU Net Neutrality Laws Fatally Undermined By Loopholes (Guardian)

Supporters of net neutrality have accused the European Union of undermining its own net neutrality laws after MEPs voted down amendments aimed at closing loopholes. Net neutrality is the principle that internet service providers should treat all online content equally without blocking or slowing down specific websites on purpose or allowing companies to pay for preferential treatment. The European parliament voted through new rules intended to enshrine that principle in law, but critics say they are fatally undermined by a number of loopholes which “open the door to an end to net neutrality”. An attempt to close those loopholes through amendments failed to gain enough support from MEPs to pass.

Following the vote, the regulations are immediately in force in all EU member states, but national regulators, who are ultimately responsible for overseeing the implementation of the rules, will not be expected to start enforcement for six months. Among the exceptions opposed by net neutrality supporters is one which allows providers to offer priority to “specialised services”, providing they still treat the “open” internet equally. Many had seen the exception as allowing providers to offer an internet fast lane to paying sites, leading to the Italian government to propose removing the exception from the draft regulations. The final draft, however, limits what services can be given priority to uses like remote surgery, driverless cars and preventing terrorist attacks. The regulation also requires that those specialised services cannot be offered if they restrict bandwidth for normal internet users.

A different exception is aimed at situations where the limitation is not speed, but data usage. The EU’s regulations allow “zero rating”, a practice whereby certain sites or applications are not counted against data limits. That gives those sites a specific advantage when dealing with users with strict data caps such as those on mobile internet. The new regulations allow national regulators to decide whether or not to allow zero rating in their own country. The most significant example of the practice is Internet.org, Facebook’s platform for spreading net access to the developing world. The service allows access for free to sites including Facebook and Wikipedia, but its cut-down nature has prompted the web’s inventor, Tim Berners-Lee, to advise people to “just say no” to it.

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A tangled web.

Territorial Disputes: The South China Sea (Bloomberg)

Some things are worth fighting for. What about a few desert islands occupied mainly by birds, goats and moles? China and Japan seem to think so, the rest of the world is alarmed and a look at other territorial disputes around the globe shows that stranger things have happened. There are about 60 such conflicts simmering worldwide. Most will bubble along, unresolved but harmless, 400 years after the Peace of Westphalia established the notion of national sovereignty. Others are more dangerous. China claims more than 80% of the South China Sea and has constructed artificial islands there for potential development. The U.S. sailed a warship through nearby waters in October, showing it doesn’t recognize the features in the Spratly Islands as having the same rights as Chinese territory.

Five other nations claim parts of the same maritime area: Vietnam, the Philippines, Brunei, Malaysia and Taiwan. China’s claim to the oil- and gas-rich waters dates to 1947. In November 2014, China and Japan agreed to disagree about century-old claims to a separate set of islands 1,000 miles to the northeast in the East China Sea. That was progress; a year earlier China had proclaimed an “air defense identification zone” over the islands. Taiwan stakes a claim, too and South Korea flew military planes through the self-proclaimed Chinese zone. President Barack Obama went to Japan in 2014 and promised to defend the disputed islands, called Senkaku in Japanese and Diaoyu in Chinese and administered by Japan since 1972. China is locked in a separate disagreement with India over the two countries’ land border.

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Boots on the ground.

US to Begin ‘Direct Action on the Ground’ in Iraq, Syria (NBC)

Defense Secretary Ashton Carter said Tuesday that the U.S. will begin “direct action on the ground” against ISIS forces in Iraq and Syria, aiming to intensify pressure on the militants as progress against them remains elusive. “We won’t hold back from supporting capable partners in opportunistic attacks against ISIL, or conducting such missions directly whether by strikes from the air or direct action on the ground,” Carter said in testimony before the Senate Armed Services committee, using an alternative name for the militant group. Carter pointed to last week’s rescue operation with Kurdish forces in northern Iraq to free hostages held by ISIS. Carter and Pentagon officials initially refused to characterize the rescue operation as U.S. boots on the ground.

However, Carter said last week that the military expects “more raids of this kind” and that the rescue mission “represents a continuation of our advise and assist mission.” This may mean some American soldiers “will be in harm’s way, no question about it,” Carter said last week. After months of denying that U.S. troops would be in any combat role in Iraq, Carter late last week in a response to a question posed by NBC News, also acknowledged that the situation U.S. soldiers found themselves in during the raid in Hawija was combat. “This is combat and things are complicated,” Carter said.

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The poor were always going to be the first and worst victims.

IMF Paints Gloomy Outlook For Sub-Saharan Africa (Reuters)

This year’s slump in commodity prices and the end of a flood of cheap dollars has pegged back African growth to its weakest in six years and things could get worse if the global economy continues to flounder, the IMF said on Tuesday. In its latest African Economic Outlook, entitled “Dealing with the Gathering Clouds”, the Fund said the poorest continent was likely to grow 3.75% this year and 4.25% next, a big drop from the years before and after the 2008/2009 financial crisis. “The strong growth momentum evident in the region in recent years has dissipated,” the report said. “With the possibility that the external environment might turn even less favourable, risks to this outlook remain on the downside.”

Hardest-hit have been sub-Sahara’s eight oil exporters – led by top producers Nigeria and Angola – although others such as Ghana, Zambia and South Africa were also suffering from weak minerals prices, power shortages and difficult financing conditions. However, the Fund noted some bright spots, most notably Ivory Coast, which is scheduled to expand as much as 9% this year due to an investment boom that followed the end of a brief civil war in 2012. This weekend’s overwhelmingly peaceful election, which President Alassane Ouattara – a former IMF official – is widely expected to win, has reinforced hopes Francophone Africa’s biggest economy has put its worst years behind it. With commodities revenues forecast to remain depressed for several years, governments have to work quickly to diversify revene sources by improving domestic tax collection, said Antoinette Sayeh, head of the IMF’s Africa department.

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The poor, the young, the old and the sick.

Children Hardest Hit By Europe’s Economic Crisis (Reuters)

Some 26 million children and young people in Europe are threatened by poverty or social exclusion after years of economic crisis, according to a study by the Bertelsmann Foundation which gave Greece the worst marks in the entire EU. Bertelmann’s Social Justice Index, an annual survey of social conditions in the 28-member bloc, found a yawning gap between north and south, and between young and old. In Spain, Greece, Italy and Portugal, the number of children and young people that are under threat because of their economic condition has increased by 1.2 million to 7.6 million since 2007, the study said. In addition, the number of EU citizens between 20 and 24 years old who are neither employed nor in education or training has risen in 25 of the 28 member states since 2008, with Germany and Sweden the only countries where the outlook for this age group has improved.

In Italy, 32% of people in their early 20s fall into this category, while in Spain it is 24.8%. “We cannot afford to lose a generation in Europe, either socially or economically,” said Aart De Geus, chairman of the executive board at Bertelsmann. “The EU and its member states must make special efforts to sustainably improve opportunities for younger people.” By contrast, the study found that a declining number of people aged 65 or older are at risk of poverty, because retirement benefits have not declined as strongly as incomes for younger citizens. Bertelsmann said three Europe-wide trends were exacerbating this gulf between young and old, including growing public debt, stagnating investment in education and research, and rising pressure on the financial viability of social security systems. Sweden, Denmark, Finland, the Netherlands and Czech Republic stood at the top of the social justice rankings, while Greece, Romania, Bulgaria, Italy and Spain were at the bottom.

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And then there’s no reason to be left for the EU.

The End Of Visa-Free Travel In Europe May Be Looming (Bloomberg)

Warnings of an end to visa-free travel intensified in the EU as Slovenia said it may join Hungary in fencing off its borders if the bloc fails to help countries on its southeastern fringe. Slovene Foreign Minister Karl Erjavec said the Adriatic nation will “adopt all measures” to ensure the safety of its citizens and migrants if the situation worsens and the accord reached Sunday in Brussels isn’t implemented, STA news service reported Tuesday. EU President Donald Tusk said the bloc must protect its external frontiers. He echoed an alarm issued Monday by Italian Foreign Minister Paolo Gentiloni, who said free-movement of people, one of the EU’s founding principles, may be at risk. “This challenge has the potential to change the European Union we have built,” Tusk told EU lawmakers on Tuesday in Strasbourg, France.

“It has the potential to create tectonic changes in the European political landscape, and these are not changes for the better.” The leaders of 11 EU and Balkan countries agreed on a 17-point plan on Sunday that offered short-term fixes for the 1 million or more migrants expected in the bloc this year. The deal includes sending about 400 policemen to help Slovenia control its borders, emergency housing for as many as 100,000 refugees, a stepped-up registration system and bolstering policing on the EU’s southeastern edge. Still, with winter approaching, countries continue to squabble over longer-term solutions. Many Balkan countries say they’re being overwhelmed after German Chancellor Angela Merkel said last month there could be no limit on asylum for those who meet the conditions. That coincided with a shift in the route taken by migrants that once led mainly through Libya to Italy. Now most are winding from Turkey to Greece, through the Balkan states, and then further north.

Complaining about a lack of coordination in the EU, countries have embarked on divergent policies. Many eastern members oppose a German-led push to redistribute the refugees across the bloc with mandatory quotas, saying the migrants don’t want to stay on their territory. Amid the bickering, Hungary has drawn criticism for fencing off its borders, while Slovenia has complained Croatia is waving migrants through. The Republic of Macedonia says its southern neighbor Greece is doing the same, without following the rules that arrivals must be registered in the first EU state they enter. Such squabbling helped prompt European Commission President Jean-Claude Juncker to call Sunday’s meeting in Brussels and he said on Tuesday that national cooperation already had improved.
“We are putting an end to all beggar-thy-neighbor policies,” Juncker told the European Parliament. “Instead, countries shall help their neighbors by telling each other what they are doing.”

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The EU must compensate Greece for all costs, not ‘allow’ it to run a bigger deficit. That’s just crazy. And amoral.

Migrant Crisis Could Prompt EU to Loosen Budget Deficit Rules (WSJ)

European Union governments will be able to offset some of the costs related to the migrant crisis from the EU’s budget deficit rules, according to a top EU official in charge of policing national budgets. Under EU rules, governments have to stick to a budget deficit of 3% of GDP or face fines. “It will be a country-by-country assessment, but we will bear in mind the cost entailed by refugee policies more than up to now,” European Commission chief Jean-Claude Juncker told the European Parliament in Strasbourg on Tuesday. Mr. Juncker said that given the “exceptionally serious problem” of the refugee crisis, there will be some room for maneuver for the Commission, the EU executive, when assessing the countries’ budget deficits.

“If a country is making huge efforts, there should be a commensurate understanding of what they have done. If a country is unable to prove it’s affected by the cost of refugee policies, then we won’t necessarily apply the flexibility of the Stability and Growth Pact to them,” Mr. Juncker said. Germany, the main destination country for refugees arriving in Europe, is expected to triple its budget for accommodating asylum seekers to an estimated €15 billion. Germany’s current deficit is within the EU rules, but that may change by the end of the year. Austria and Italy, two countries affected by the migration crisis and whose budgets are likely to surpass the 3% threshold, have already been pressing the Commission to exempt their refugee spending from the EU’s budget assessment.

Fiscal hawks, however, including Germany’s own finance minister, Wolfgang Schäuble, have been wary of supporting that call, for fear that other countries will seize the opportunity and offset budget expenditures which aren’t necessarily refugee-related. Greece, Croatia and Slovenia—all countries on the main migrant route into Europe—are already in breach of the 3% deficit rule. They are likely to get their deadlines for reaching 3% extended if they can prove that the refugee crisis has taken a toll on their already-strapped coffers.

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The EU has no military. Nor would it solve anything. Separate countries do, but can they operate on reign territory?

Slovenia Considers Calling For EU Military Aid (FT)

Slovenia, the tiny Balkan state struggling to cope with the migration crisis, has raised the idea of invoking a never-before-used “solidarity clause” in the EU treaties to formally request European aid and military support. Ljubljana recently floated the option of triggering Article 222, which enables military aid to EU nations overwhelmed by disasters, according to two officials familiar with the talks. It indicates the drastic steps under consideration to deal with a tide of asylum seekers arriving in Europe. The Alpine state of just 2m people has received 84,000 migrants over the past 10 days, leading the government to call in its national army as well as private security personnel to help its small police force. It received a further 8,000 migrants between Monday evening and Tuesday morning — a figure that exceeds the size of Slovenia’s army.

Against that backdrop, one Slovenian government official said invoking Article 222 was a “viable option” as a last resort. Ljubljana has not officially commented on the idea. Alarmed by the potential for Slovenia pulling the bloc’s emergency cord, EU officials have sought to head off a request, in part by arranging for EU countries to provide 400 police to help Ljubljana manage the crisis. Slovenian officials have put a brave face on the meagre results of Sunday’s summit of European leaders on the so-called western Balkans route, but are keeping up threats to take more aggressive steps. Miro Cerar, Slovenia’s prime minister, had warned the EU would “fall apart” unless the “unbearable” pressure was not eased promptly. His foreign minister Karl Erjavec hinted at the potential for a fence, saying “impediments” could be considered to stem the cross-border flows.

The solidarity clause states that EU member states “shall mobilise all the instruments at its disposal, including the military resources” in the event the requesting country is subject to a terrorist attack or is the victim or a man-made or natural disaster. It has never been invoked. Although the clause is explicit in the potential for military aid and the “spirit of solidarity”, it does not say the support would be automatic. Some EU officials are keen for the principle not to be tested. Up to half a million migrants have attempted to pass through the so-called Balkan corridor between Greece and Germany since the start of the year, overwhelming governments and inflaming already tense relations in the region.

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Devastating.

The Children’s Feet Are Rotting, In 1 Month All These People Will Be Dead (HP)

“There are thousands of children here and their feet are literally rotting, they can’t keep dry, they have high fevers and they’re standing in the pouring rain for days on end. You have one month guys, and then all these people will be dead”. Those were the final words of Dr Linda on the phone, a doctor that our volunteer organisations (Help Refugees and CalAid) had asked to fly out to Lesbos in response to an emergency cry for help from an overwhelmed volunteer on the ground. The weight of those words and the responsibility that comes with them felt crippling. But why are we, a film maker, a radio presenter, and a music assistant being tasked with this responsibility? Shouldn’t, as we had presumed, the large charities and governments be taking the charge of care for the precious lives arriving on Europe shores?

Another call came in – this time from volunteers in Serbia – the refugees are burning plastic bags to keep warm, they have nothing else, they are freezing to death, and the fumes from the bags are slowly poisoning them, please send help. Then another – this time from volunteers on Lesbos trying to find out how to order body bags en masse… will they have to resort this? Time will tell, but certainly people there have already started to die. We wished we could pick up the phone and call someone… who? A charity? An emergency team? The government? The army? How could we sit by and watch whilst these people die, and the handfuls of volunteers struggle and suffer too. But who is there to call? The charities are acting slowly, they have protocols to follow, political considerations, red tape, hierarchy and procedures.

Our government’s policy is not to help in Europe, and only to send aid to places like Syria, Lebanon in Jordan. So… it’s left to everyday people, untrained, unprepared, and overwhelmed, to deal with this crisis. Everyday people like us… a small group of friends who nine weeks ago decided to raise a little bit of cash, get a car load of goods and drive it to Calais. We’d heard from friends who’d been there some of the terrible stories of war and persecution, we knew that numbers were growing, that more children were coming everyday, and that conditions were dire. Our plan was to do our bit, pat ourselves on the back, and then go back to our lives feeling that we’d done something good for our fellow mankind.

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Nature is a complex system.

So Long And Thanks For All The Poo (WaPo)

It only takes a glance at a history book and a look out the window to know that our planet has lost many of its biggest creatures: The world that was once home to mammoths and towering dinosaurs can now barely maintain stable populations of rhinos and whales. But according to a new study, we’ve got more to mourn than just the animals themselves. We’ve lost their feces, too — and that’s a bigger problem than you might think. Why should we miss steaming piles of dinosaur dung? According to research published Monday in the Proceedings of the National Academy of Sciences, megafauna play a greater role in the spread of nutrients across the planet than scientists ever realized. The research focused on modeling the distribution of phosphorus, a nutrient necessary for fertilizing plant growth.

Scientists know that animals help carry these nutrients around by, well, not pooping where they eat. Without this process, nutrients would end up following gravity onto the ocean floor, instead of spreading as high as the mountain tops. But these days most of the nutrient recycling that happens is due to bacteria — not wandering poopers. “I wanted to know whether the world of the past with all the endemic animals was more fertile than our current world,” lead study author Chris Doughty of Oxford University told The Post. “Large free-ranging animals are much less abundant than they once were. Today, if scientists were to study the role of animals they would find that it is important but small,” Doughty explained. “However, in the past, we hypothesize that it would have been at least an order of magnitude larger than today.

Essentially, we have replaced wild free-roaming animals with fenced domestic cattle that cannot move nutrients in the same way.” Some of these contributors — the massive land animals that once roamed our planet — are gone for good. But others are dwindling before our very eyes. In one example of the effect, the researchers found that whales — which have seen dramatic population loss in the last century, mainly due to hunting and habitat disruption — used to bring an estimated 750 million pounds of phosphorus up from the deep ocean to the surface each year. Since whales feed deep in the water and come up to breathe — and poop — at the surface, they’re great at helping to recycle these resources.

But today, the researchers estimate, whales only bring 165 million pounds of phosphorus up annually. That’s just 23% of their previous contribution. Phosphorus movement by birds and fish that come inland after eating in the sea (like salmon, for example) are just 4% what they once were.

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