Sep 232021
 


Hasui Kawase Moon at Megome (woodblock print) 1930

 

Early Treatment vs Stay at Home Until You Can’t Breathe (Burk)
The Lesson Of Ivermectin: Meta-analyses Based On Summary Data (Nature)
Florida Surgeon General Nominee Ladapo ‘Done With’ Vaccine ‘Fear’ (NM)
Quantum-Dot Tattoos Hold Vaccination Record (Rice)
From The Mouth Of A Front Line Nurse (Tribe)
North Carolina Hospital System Suspends 365 Unvaxxed Employees (ET)
Anti-Vaxxer Father To Stand Trial On Friday (K.)
Greek Gov’t Moves To Protect Teachers From Anti-Vaxxers, Covid Deniers (K.)
US to Donate 500 Million More COVID-19 Vaccines to Poor Countries (ET)
Covid-19 In Norway Can Now Be Compared To The Flu – Health Chief (Loc.)
The Politics of Fear and Self-Preservation (Whitney Webb)
The Hunter Biden Laptop Is Confirmed?! Color Us Shocked! (NYP Ed.)

 

 

Barnes

 

 

“Call anyone hospitalised within 14 days of jab ‘unvaccinated’. Don’t highlight that most adverse reactions to jab will happen within first 14 days. Voilà: ‘Pandemic of the Unvaccinated’.”

 

 

Croatia

 

 

3 months is all you get. And then it’s booster time.

 

 

Kulldorff

 

 

Sep 11. Should we all say Stromectol istead of ivermectin?

Early Treatment vs Stay at Home Until You Can’t Breathe (Burk)

Flavio Cadeginia, MD, PhD, is an academic endocrinologist in Brazil who took a team of researchers to the State of Amazonas in January 2021 to evaluate the situation in cities where hospitals were overcrowded with the gamma variant wave of the virus. Half his team was skeptical that early outpatient treatment could have any impact on keeping patients out of the hospital. Almost all the cities were running out of oxygen supplies including Manaus, the capital of 2.2 million. Dr. Cadeginia encountered an unexpected anomaly in Coari, a small city of 56,000 where the hospitals were empty. He asked the health director for an explanation, but she was shy to reply in front of the group and requested a private conversation. She admitted that they had been giving Stromectol to the entire population for the past 2 months, but was afraid to tell him for fear of being accused of using an unproven treatment.

His whole team became immediate believers in early treatment. Similar stories about early treatment successes with Stromectol (brand name to avoid censorship) have been reported in other countries including Peru and India. In Peru, an army-led mass early treatment program, Mega-Operación Tayta (MOT), in the fall of 2020 resulted in a 14-fold decrease in excess deaths. When the MOT was canceled and a restrictive treatment program was instituted by a new president in November, there was a 13-fold increase in excess deaths over the next 2 months. In India, Uttar Pradesh is a state of 241 million, 2/3 the size of the United States. A wave of the delta variant in the summer of 2021 resulted in 414,000 cases and 4,000 deaths per day. Five weeks after adding Stromectol to their treatment protocol there was a dramatic drop on August 5th to 26 new cases and 3 deaths.

On that same day in the US there were 127,108 new cases and 574 new deaths where the use of Stromectol has been actively discouraged by the FDA and Tony Fauci at the NIH. Following the lead of the US rather than Uttar Pradesh, the State of Tamil Nadu rejected Stromectol in May going on to lead India in death rate. This fateful decision was influenced by a Tweet from WHO Chief Scientist Dr. Soumya Swaminathan against the use of Stromectol resulting in her being sued by the Indian Bar Association and threatened with criminal prosecution for each death. They accused her of furthering the agenda of the drug companies in protecting the EUA for their profitable vaccines. More than 10 successful lawsuits have been won against US hospitals by Ralph Lorigo for prohibiting prescription of Stromectol to dying patients in the ICU.

In January 2021 a judge ordered Rochester General Hospital to give it to Sue Dickinson, a 65-year old woman on a ventilator, who improved within 12 hours and was later released from the hospital. Eight other patients, including 81-year old John Swanson and 80-year old Judith Smentkiewicz, also made similar court-ordered miraculous recoveries. Why would the CDC aggressively block the compassionate off label use of a “wonder” drug with anti-viral properties taken safely by billions of people around the world for the treatment of parasitic diseases and meriting the Nobel Prize in 2015 for its discoverers? According to Robert F. Kennedy, Jr., the CDC is considered a “captured agency,” a sock puppet for the industry it is supposed to regulate. Half of their budget comes from buying and selling vaccines making it the biggest vaccine distributor in the country.

Read more …

Nature Magazine cannot call it a horse dewormer anymore, that’s what they have the rest of the press for.

But they can ask for a (long-term) “meta-analysis” for a proven safe drug, while propagating substances for which no such analysis or safety profile exists.

The Lesson Of Ivermectin: Meta-analyses Based On Summary Data (Nature)

Relying on low-quality or questionable studies in the current global climate presents severe and immediate harms. The enormous impact of COVID-19 and the consequent urgent need to demonstrate the clinical efficacy of new therapeutic options provides fertile ground for even poorly evidenced claims of efficacy to be amplified, both in the scientific literature and on social media. This context can lead to the rapid translation of almost any apparently favorable conclusion from a relatively weak trial or set of trials into widespread clinical practice and public policy. We believe that this situation requires immediate remediation. The most salient change required is a change in perspective on the part of both primary researchers and those who bring together the results of individual studies to draw wider conclusions.

Specifically, we propose that clinical research should be seen as a contribution of data toward a larger omnibus question rather than an assemblage of summary statistics. Most, if not all, of the flaws described above would have been immediately detected if meta-analyses were performed on an individual patient data (IPD) basis. In particular, irregularities such as extreme terminal digit bias and the duplication of blocks of patient records would have been both obvious and immediately interrogable from raw data if provided.

We recommend that meta-analysts who study interventions for COVID-19 should request and personally review IPD in all cases, even if IPD synthesis techniques are not used. In a similar vein, all clinical trials published on COVID-19 should immediately follow best-practice guidelines and upload anonymized IPD so that this type of analysis can occur. Any study for which authors are not able or not willing to provide suitably anonymized IPD should be considered at high risk of bias for incomplete reporting and/or excluded entirely from meta-syntheses.

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“The state will approach policymaking, he said, in a manner that is “very explicit about the differences between ‘the science’ and our opinions.”

Florida Surgeon General Nominee Ladapo ‘Done With’ Vaccine ‘Fear’ (NM)

Florida Gov. Ron DeSantis on Tuesday announced that Dr. Joseph Ladapo would be the state’s new surgeon general and secretary of its health department. “Joe has had a remarkable academic and medical career,” DeSantis, a Republican, said of the Harvard-trained M.D. and Ph.D., according to the Florida news station WJHG7. Ladapo, who is awaiting the approval of the Florida Legislature, says that “we’re done with fear,” according to Real Clear Politics. “That’s something that’s been unfortunately a centerpiece of health policy in the United States ever since the beginning of the pandemic, and it’s over here. Expiration date, it’s done.” Ladapo said that the state will approach COVID-19 openly and scientifically. The state will approach policymaking, he said, in a manner that is “very explicit about the differences between ‘the science’ and our opinions.”

“What’s been happening over the past year is that people have been taking the science, and they’ve been misrepresenting it. … It’s been unclear where the discussion about ‘the science’ ends and discussion about how you feel about the science and what you want people to do with the science begins.” According to WPTV5, when asked what he thinks about vaccination against COVID-19, Ladapo responded: “The state should be promoting good health, and vaccination isn’t the only path to that. It’s been treated almost like a religion, and that’s just senseless, right? There are lots of good pathways to health, and vaccination’s not the only one.” DeSantis, who has promoted the use of other ways to treat COVID-19, said information that suggests alternative treatments to vaccines has been suppressed by the powers that be in Washington.

Speaking about monoclonal antibodies, DeSantis said: “I do think that one of the reasons why this was not something that was put out there very publicly by the experts and by the powers [that] be in D.C. is because they feared that if you tell people there’s an effective treatment, you tell people COVID’s a treatable illness, they feared some people would say, ‘Well, you know, maybe I won’t get vaccinated. I’ll just get the treatment. ”And so they didn’t want that message out because they feared how people would behave.”

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“The Bill and Melinda Gates Foundation came to us and said, ‘Hey, we have a real problem — knowing who’s vaccinated..’”

Quantum-Dot Tattoos Hold Vaccination Record (Rice)

Keeping track of a child’s shots could be so much easier with technology invented by a new Rice University professor and his colleagues. Kevin McHugh, an assistant professor of bioengineering at Rice since this summer, and a team at his previous institution, the Massachusetts Institute of Technology, report in a cover story in Science Translational Medicine on their development of quantum-dot tags that fluoresce with information after they’re injected as part of a vaccination. The tags are incorporated in only some of the array of sugar-based microneedles on a patch. When the needles dissolve in about two minutes, they deliver the vaccine and leave the pattern of tags just under the skin, where they become something like a bar-code tattoo.


A pattern of 1.5-millimeter microneedles that contain vaccine and fluorescent quantum dots are applied as a patch. The needles dissolve under the skin, leaving the encapsulated quantum dots. Their pattern can be read to identify the vaccine that was administered. The project was co-led by Rice University bioengineer Kevin McHugh during his time at MIT. (Credit: Second Bay Studios)

Instead of ink, this highly specific medical record consists of copper-based quantum dots embedded in biocompatible, micron-scale capsules. Their near-infrared dye is invisible, but the pattern they set can be read and interpreted by a customized smartphone. The two-year project is aimed at the 1.5 million preventable deaths that result from a lack of vaccinations, primarily in developing nations. “The Bill and Melinda Gates Foundation came to us and said, ‘Hey, we have a real problem — knowing who’s vaccinated,’” said McHugh, who was recruited to join Rice with funding from the Cancer Prevention and Research Institute of Texas. “They said, ‘We go on vaccination campaigns where people get into Hummers, drive to a rural village, set up a tent and start immunizing people, but they don’t always know who’s been immunized before and what vaccines are still needed.”

Parents often don’t know their children’s vaccination histories, McHugh said. “So our idea was to put the record on the person,” he said. “This way, later on, people can scan over the area to see what vaccines have been administered and give only the ones still needed. There are two sides to this,” he said. “First, is that you don’t administer unnecessary vaccines, which has a cost. But even bigger, you don’t leave people underimmunized and at risk of getting an infectious disease.”

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Thread. A lot of people saying this is just anecdotal. But because of all the censoring, that’s often all we have.

From The Mouth Of A Front Line Nurse (Tribe)

From the mouth of a front line nurse: So I have mentioned on here multiple times that my wife’s a nurse at a hospital. Last night she worked an extra shift in the Emergency Room(not her regular department). She found out, how they” are getting away with claiming there’s a “pandemic of the unvaccinated” While dealing with a patient who came in exhibiting symptoms of myocarditis, a FT Emergency Room nurse conveyed some very interesting information to my wife. Apparently all patients are asked whether or not they received the cv19 vax, no matter what issue it is that brought them into the ER. If the patient received the vax less than 14 days prior, they are recorded as “Un-Vaxxed”


The story the nurses are being given, is that this is done because the vax takes 14 days to start working. The FT ER nurse my wife talked to last night has a different theory: It has been her observation that most patients coming in with what appears to be vaccine injuries are coming in within 72 hours of receiving the jab. By recording these patients as “Un-Vaxxed” they can do a few things: – one, they can claim those vax injuries are a result of Covid & not the shot – two, they can bury the vaccine injury – three, they get to claim there’s a “pandemic of the unvaccinated”. It also turns out that nurses are being required to sign nondisclosure agreements, promising not to publicly discuss any procedures dealing with c.. id. My wife refused to sign this agreement, and she’s awaiting possible retaliatory response from upper management.

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Good luck with that.

North Carolina Hospital System Suspends 365 Unvaxxed Employees (ET)

A North Carolina health care system said it suspended hundreds of its employees after the firm implemented a COVID-19 vaccine mandate, adding that workers who refuse to get vaccinated after five days will be fired. “Beginning this week, approximately 375 team members—across 15 hospitals, 800 clinics and hundreds of outpatient facilities—have been confirmed to be non-compliant and are not able to report to work,” stated a press release from Novant Health, which is based in North Carolina but operates in other states. “They will have an opportunity to comply over a five day, unpaid suspension period,” the release said. “If a team member remains non-compliant after this suspension period, he or she will have their employment with Novant Health terminated.”


The firm then claimed that about 98.5 percent of its workforce are compliant with the policy, meaning they have received at least one dose of a COVID-19 vaccine. Workers who started a two-dose vaccine series have until Oct. 15 to get the second shot, Novant said. Employees who have an exemption are required to get weekly COVID-19 testing, as well as wear N95 masks and eye protection, it added. In a similar move, 125 workers with Indiana University Health, the biggest hospital system in the state, parted ways with the company, according to a news release issued last week. Those workers, it said, did not comply with the firm’s vaccine mandate.

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Interesting from Greece. The guy’s been on all TV channels for three days, with the purpose of painting him as a terrible person. But many people don’t see him that way.

Anti-Vaxxer Father To Stand Trial On Friday (K.)

A 37-year-old man in Thessaloniki, northern Greece, is due to stand trial on Friday after being arrested in the act of causing a disturbance at his son’s elementary school after the boy was not allowed onto the premises because he did not comply with coronavirus safety rules. The boy’s father reportedly barged into the school grounds, shoved and yelled at the principal and prevented other pupils for entering after his son would not produce a negative self-test or wear a mask before entering the premises on Tuesday morning. The incident took place at the Second Elementary School of Thermi, southeast of Thessaloniki.


The 37-year-old was accused of disrupting the operation of a public service, among other charges, and was given until Friday to prepare his defense. Speaking to local media after his release from police custody, the 37-year-old claimed that his son transferred to the Thermi school after a similar incident at his previous school. “Our children are God’s children. I will send him back to school again tomorrow without a mask and without a self-test. Anyone who stands in my way will suffer the consequences,” he told reporters.

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And then you get this…. They just change the law..

Greek Gov’t Moves To Protect Teachers From Anti-vaxxers, Covid Deniers (K.)

Greece’s Citizen Protection Ministry, which is in charge of the police, announced on Wednesday that teachers will no longer be taken into police custody when they are sued by parents of students who oppose the health rules imposed to prevent the spread of the coronavirus in schools. Under government regulations, unvaccinated pupils have to procure negative self test results twice each week, while teachers will have to take twice weekly rapid tests. Pupils and teachers are obliged to wear masks. At the same time, the government is planning to abolish the so-called aftoforo – a law permitting a swift hearing if an arrest is made within 48 hours of an alleged crime – in cases such as these. The move follows a barrage of arrests and lawsuits against educators by parents who refuse to vaccinate their children or even wear face masks.

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500 million Trojan horses.

Dave Collum @DavidBCollum:
“Let me help you with that headline:

US Taxpayer Gives Pfizer $10 billion Dollars”

US to Donate 500 Million More COVID-19 Vaccines to Poor Countries (ET)

The United States has reached an agreement with Pfizer to buy an additional 500 million doses of its COVID-19 vaccine to donate to various countries, President Joe Biden announced Wednesday. “We know we have to act to save lives now,” Biden told a virtual COVID-19 summit that his administration convened when world leaders and business executives. The doses will be donated to low- and lower-middle-income countries around the world,” a senior administration official, who was speaking to reporters on the condition they were not identified, told reporters in a call. They’re all Pfizer doses. The tranche will be made in the United States and will start shipping out in January 2022.


The additional commitment means the United States has pledged to donate or has already donated 1.1 billion vaccine doses. That includes 500 million Pfizer doses that the United States bought over the summer and promised to send to countries the government said needed them. So far, nearly 160 million doses have been sent out to 100 countries around the world, including Peru, Pakistan, Sri Lanka, Sudan, El Salvador, and Ethiopia. Most of those have gone to lower-middle-income countries, according to an analysis from the Kaiser Family Foundation. “The United States is donating 1.1 billion doses of COVID-19 vaccines to the world, free of charge, no strings attached,” the official said. “This is a huge commitment by the U.S.”

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Scandinavia seems less prone to insanity.

Covid-19 In Norway Can Now Be Compared To The Flu – Health Chief (Loc.)

Coronavirus can now be categorised as one of several respiratory illnesses with seasonal variation, Geir Bukholm, assistant director of the Norwegian Institute of Public Health (NIPH), has said. For the past year and a half, Covid-19 has been classed as a generally dangerous disease. However, this could change soon as the assistant director of the Norwegian Institute of Public Health (NIPH), Geir Bukholm, has said the coronavirus can now be put in the same category as illnesses such as flu, common colds and RS (respiratory syncytial virus). “We are now in a new phase where we must look at the coronavirus as one of several respiratory diseases with seasonal variation,” Bukholm told paper VG.


Last week the Ministry of Health and Social Care asked the NIPH to assess whether Covid-19 was still a dangerous disease. While the NIPH has yet to return its findings, its assistant director has made it clear that the danger of Covid will be downgraded. Covid could now be compared in severity with the likes of colds and flu because the vast majority of those at most risk of developing severe disease when infected are now fully vaccinated. “This is because the vast majority of those at risk are protected,” Bukholm explained. “And although the infection is still circulating, hospital numbers remain low. Thus, the coronavirus will not lead to a heavy burden on the health service. For those vaccinated who may become infected and develop symptoms, the vast majority will have mild cold-like symptoms.”

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From 9/11 to Covid. It’s a straight line.

The Politics of Fear and Self-Preservation (Whitney Webb)

Many of those who have been quick and vocal to point out the lies of the US government when it comes to the invasions of Afghanistan and Iraq and other consequences of the War on Terror have been unable to even consider that the official story of 9/11 may not be legitimate and may indeed have been dealt from the same pack. This may be for a variety of reasons, including a strong desire to not be de-legitimized by their peers as bearers of the “conspiracy theorist” smear and an unwillingness to face a political reality where US government officials may have been complicit in a deadly attack on American soil. In those two examples, however, the failure of such individuals, particularly in media, to even consider that there may be more to the story boils down to a desire for self-preservation in the case of the former and preservation of a particular worldview in the case of the latter.

Yet, in both cases, the casualty is the truth and the cause is cowardice. By failing as a society to thoroughly examine the events of 9/11 and why those events occurred, the American public has shown the powers that be that their desire to preserve a “safe” worldview — and to preserve their own careers, in the case of certain professional classes — is enough to keep people from questioning world-altering events when they emerge. Those powers are well aware of this refusal and have been using it to their advantage ever since. Today, with the COVID-19 crisis still dragging on, we are similarly immersed in a situation where nuance and facts are being cast aside, militantly in some cases, in favor of the establishment narrative. Is everyone who chooses not to take this particular vaccine a “conspiracy theorist” and “anti-vaxxer”?

Does it really make sense to so dramatically divide the public into groups of vaccinated and unvaccinated through a new ID system when the vaccine claims to reduce the severity of illness but not to stop disease transmission? Should those that question the motivation of politicians, powerful pharmaceutical corporations and mainstream media “experts” be censored from expressing those views online? You do not need to agree with those who hold such views, but what is wrong with hearing what they have to say and debating their evidence with your own?

We are losing the ability to have rational public discourse about these issues — and losing it swiftly, at a speed comparable to what took place in the aftermath of 9/11, when questioning the motives of the Bush administration, US intelligence agencies and other groups, as well as their proposed responses and “solutions,” was deemed “unpatriotic” and even “treasonous” by some. Calls were made to strip an entire class of Americans of their freedom for merely sharing the same ethno-religious identities as those we were told attacked us, and many went along with it. Freedom became treated as a privilege only for certain groups, not as a right, and this insidious fallacy has reared its head yet again in recent months in relation to the COVID-19 vaccine debate and also the war on domestic terror.

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The New York Post deserves to have a say here.

The Hunter Biden Laptop Is Confirmed?! Color Us Shocked! (NYP Ed.)

In his new book, “The Bidens: Inside the First Family’s Fifty-Year Rise to Power,” Politico reporter Ben Schreckinger says that evidence points to Hunter Biden’s laptop being legit. While we appreciate the support, the truth is The Post’s reports always have been true, and it’s only because the media wants to protect Joe Biden that they keep referring to the laptop as “unsubstantiated.” Schreckinger notes that “A person who had independent access to Hunter Biden’s emails” confirms two of the e-mails the Post published, including one about a potential deal with China with the line “10 held by H for the big guy?” — that is, Joe Biden. But Hunter Biden’s former business partner Tony Bobulinski already said those e-mails were authentic — the media just ignored him.

Schreckinger adds that e-mails released by the Swedish government also match e-mails from the laptop (Hunter had gotten into a kerfuffle when he was staying in a Swedish embassy building). That’s also been reported. For those who doubt that Hunter would just forget a laptop at a repair shop, Schreckinger notes that Biden’s son abandoned another computer at the home of psychiatrist Keith Ablow. Feds seized that machine when they raided Ablow over abuse claims; Hunter eventually got it back. “I wasn’t keeping tabs on possessions very well for about a four-year period of time,” Hunter said. All of this information is out there. Yet The Times still called the laptop “unsubstantiated” last week (until they quietly corrected the story).

And even as Politico credited its reporter, it added, “While the leak contains genuine files, it remains possible that fake material has been slipped in.” What part? The pictures of Hunter smoking crack? Schreckinger called the White House to check whether, as we reported, Joe Biden met Hunter for a dinner in April 2015 that included Burisma adviser Vadym Pozharskyi. Biden’s team pointed him to a Washington Post “fact check” — which noted that Biden’s team had at first said there “no record of such a meeting,” until they finally conceded that, yes, Joe did drop in on that dinner. The fact confirmed, the writer still concludes, haughtily, that there’s “less to the story than one might imagine.” It’s the perfect example of how Democrats weaponize “fact checkers” to deflect criticism and enlist social media to censor articles. Nothing to see here! See: The Wuhan Lab theory.

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Oz apology

 

 

 

 

 

 

 

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Nov 182017
 
 November 18, 2017  Posted by at 9:58 am Finance Tagged with: , , , , , , , , , , , ,  4 Responses »


Henri Cartier Bresson Juvisny, France 1938

 

Consumers Are Both Confident And Broke (John Rubino)
You Have Been Warned (Lance Roberts)
Norway Plan to Sell Off $35 Billion in Oil, Gas Stocks Rattles Markets (BBG)
The World’s Biggest Wealth Manager Won’t Touch Bitcoin (BBG)
Trump’s Saudi Scheme Unravels (Alastair Crooke)
Saudi ‘Corruption’ Probe Widens: Dozens Of Military Officials Arrested (ZH)
Hariri Arrives in Paris With Family Amid Saudi-Iran Tensions (BBG)
Qatar Says It Has US Backing in Lingering Gulf Crisis (BBG)
House Prices Aren’t The Issue – Land Prices Are (G.)
ECB Denies EU Auditors Access To Information On Greek Bailouts (EuA)
Greek Pensioners Forced To Return ‘Social Dividend’ (K.)
UK Considers Tax On Single-Use Plastics To Tackle Ocean Pollution (G.)
Irish Catholic Priest Urges Christians To Abandon The Word Christmas (G.)

 

 

Powerful graph from Bob Prechter.

Consumers Are Both Confident And Broke (John Rubino)

Elliott Wave International recently put together a chart (click here or on the chart to watch the accompanying video) that illustrates a recurring theme of financial bubbles: When good times have gone on for a sufficiently long time, people forget that it can be any other way and start behaving as if they’re bulletproof. They stop saving, for instance, because they’ll always have their job and their stocks will always go up. Then comes the inevitable bust. On the following chart, this delusion and its aftermath are represented by the gap between consumer confidence (our sense of how good the next year is likely to be) and the saving rate (the portion of each paycheck we keep for a rainy day). The bigger the gap the less realistic we are and the more likely to pay dearly for our hubris.

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“Prior to 2000, debt was able to support a rising standard of living..” Two decades later, it can’t even maintain the status quo. That’s what you call a breaking point.

You Have Been Warned (Lance Roberts)

There is an important picture that is currently developing which, if it continues, will impact earnings and ultimately the stock market. Let’s take a look at some interesting economic numbers out this past week. On Tuesday, we saw the release of the Producer Price Index (PPI) which ROSE 0.4% for the month following a similar rise of 0.4% last month. This surge in prices was NOT surprising given the recent devastation from 3-hurricanes and massive wildfires in California which led to a temporary surge in demand for products and services.

Then on Wednesday, the Consumer Price Index (CPI) was released which showed only a small 0.1% increase falling sharply from the 0.5% increase last month.

This deflationary pressure further showed up on Thursday with a -0.3 decline in Export prices. (Exports make up about 40% of corporate profits) For all of you that continue to insist this is an “earnings-driven market,” you should pay very close attention to those three data points above. When companies have higher input costs in their production they have two choices: 1) “pass along” those price increase to their customers; or 2) absorb those costs internally. If a company opts to “pass along” those costs then we should have seen CPI rise more strongly. Since that didn’t happen, it suggests companies are unable to “pass along” those costs which means a reduction in earnings. The other BIG report released on Wednesday tells you WHY companies have been unable to “pass along” those increased costs.

The “retail sales” report came in at just a 0.1% increase for the month. After a large jump in retail sales last month, as was expected following the hurricanes, there should have been some subsequent follow through last month. There simply wasn’t. More importantly, despite annual hopes by the National Retail Federation of surging holiday spending which is consistently over-estimated, the recent surge in consumer debt without a subsequent increase in consumer spending shows the financial distress faced by a vast majority of consumers. The first chart below shows a record gap between the standard cost of living and the debt required to finance that cost of living. Prior to 2000, debt was able to support a rising standard of living, which is no longer the case currently.

With a current shortfall of $18,176 between the standard of living and real disposable incomes, debt is only able to cover about 2/3rds of the difference with a net shortfall of $6,605. This explains the reason why “control purchases” by individuals (those items individuals buy most often) is running at levels more normally consistent with recessions rather than economic expansions.

If companies are unable to pass along rising production costs to consumers, export prices are falling and consumer demand remains weak, be warned of continued weakness in earnings reports in the months ahead. As I stated earlier this year, the recovery in earnings this year was solely a function of the recovering energy sector due to higher oil prices. With that tailwind now firmly behind us, the risk to earnings in the year ahead is dangerous to a market basing its current “overvaluation” on the “strong earnings” story.

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Another way to push up prices?

Norway Plan to Sell Off $35 Billion in Oil, Gas Stocks Rattles Markets (BBG)

Norway’s proposal to sell off $35 billion in oil and natural gas stocks brings sudden and unparalleled heft to a once-grassroots movement to enlist investors in the fight against climate change. The Nordic nation’s $1 trillion sovereign wealth fund said Thursday that it’s considering unloading its shares of Exxon Mobil, Royal Dutch Shell and other oil giants to diversify its holdings and guard against drops in crude prices. European oil stocks fell. Norges Bank Investment Management would not be the first institutional investor to back away from fossil fuels. But until now, most have been state pension funds, universities and other smaller players that have limited their divestments to coal, tar sands or some of the other dirtiest fossil fuels. Norway’s fund is the world’s largest equity investor, controlling about 1.5% of global stocks. If it follows through on its proposal, it would be the first to abandon the sector altogether.

“This is an enormous change,” said Mindy Lubber, president of Ceres, a non-profit that advocates for sustainable investing. “It’s a shot heard around the world.” The proposal rattled equity markets. While Norwegian officials say the plan isn’t based on any particular view about future oil prices, it’s apt to ratchet up pressure on fossil fuel companies already struggling with the growth of renewable energy. Norway’s Finance Ministry, which oversees the fund, said it will study the proposal and will take at least a year to decide what to do. The fund has already sold off most of its coal stocks. “People are starting to recognize the risks of oil and gas,” said Jason Disterhoft of the Rainforest Action Network, which pushes banks to divest from fossil fuels.

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From the biggest wealth fund to the biggest wealth manager.

The World’s Biggest Wealth Manager Won’t Touch Bitcoin (BBG)

UBS, the world’s largest wealth manager, isn’t prepared to make portfolio allocations to bitcoin because of a lack of government oversight, the bank’s chief investment officer said. Bitcoin has also not reached the critical mass to be considered a viable currency to invest in, UBS’s Mark Haefele said in an interview. The total sum of all cryptocurrencies is “not even the size of some of the smaller currencies” that UBS would allocate to, he said. Bitcoin has split investors over the viability of the volatile cryptocurrency and UBS is among its critics. Bitcoin capped a resurgent week by climbing within a few dollars of a record $8,000 on Friday. Still, events such as a bitcoin-funded terrorist attack are potential risks which are hard to evaluate, he said.

“All it would take would be one terrorist incident in the U.S. funded by bitcoin for the U.S. regulator to much more seriously step in and take action, he said. “That’s a risk, an unquantifiable risk, bitcoin has that another currency doesn’t.” While skeptics have called bitcoin’s rapid advance a bubble, it has become too big an asset for many financial firms to ignore. Bitcoin has gained 17% this week, touching a high of $7,997.17 during Asia hours before moving lower in late trading. The rally through Friday came after bitcoin wiped out as much as $38 billion in market capitalization following the cancellation of a technology upgrade known as SegWit2x on Nov. 8.

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Former (and current?!) TAE contributor Alastair Crooke draws his conclusions.

Trump’s Saudi Scheme Unravels (Alastair Crooke)

Aaron Miller and Richard Sokolsky, writing in Foreign Policy, suggest “that Mohammed bin Salman’s most notable success abroad may well be the wooing and capture of President Donald Trump, and his son-in-law, Jared Kushner.” Indeed, it is possible that this “success” may prove to be MbS’ only success. “It didn’t take much convincing”, Miller and Sokolski wrote: “Above all, the new bromance reflected a timely coincidence of strategic imperatives.” Trump, as ever, was eager to distance himself from President Obama and all his works; the Saudis, meanwhile, were determined to exploit Trump’s visceral antipathy for Iran – in order to reverse the string of recent defeats suffered by the kingdom.

So compelling seemed the prize (that MbS seemed to promise) of killing three birds with one stone (striking at Iran; “normalizing” Israel in the Arab world, and a Palestinian accord), that the U.S. President restricted the details to family channels alone. He thus was delivering a deliberate slight to the U.S. foreign policy and defense establishments by leaving official channels in the dark, and guessing. Trump bet heavily on MbS, and on Jared Kushner as his intermediary. But MbS’ grand plan fell apart at its first hurdle: the attempt to instigate a provocation against Hezbollah in Lebanon, to which the latter would overreact and give Israel and the “Sunni Alliance” the expected pretext to act forcefully against Hezbollah and Iran.

Stage One simply sank into soap opera with the bizarre hijacking of Lebanese Prime Minister Saad Hariri by MbS, which served only to unite the Lebanese, rather than dividing them into warring factions, as was hoped. But the debacle in Lebanon carries a much greater import than just a mishandled soap opera. The really important fact uncovered by the recent MbS mishap is that not only did the “dog not bark in the night” – but that the Israelis have no intention “to bark” at all: which is to say, to take on the role (as veteran Israeli correspondent Ben Caspit put it), of being “the stick, with which Sunni leaders threaten their mortal enemies, the Shiites … right now, no one in Israel, least of all Prime Minister Benjamin Netanyahu, is in any hurry to ignite the northern front. Doing so, would mean getting sucked into the gates of hell”.

Read more …

Targeting the military means MbS does not feel safe. How desperate is he?

Saudi ‘Corruption’ Probe Widens: Dozens Of Military Officials Arrested (ZH)

After jailing dozens of members of the royal family, and extorting numerous prominent businessmen, 32-year-old Saudi prince Mohammed bin Salman has widened his so-called ‘corruption’ probe further still. The Wall Street Journal reports that at least two dozen military officers, including multiple commanders, recently have been rounded up in connection to the Saudi government’s sweeping corruption investigation, according to two senior advisers to the Saudi government. Additionally, several prominent businessmen also were taken in by Saudi authorities in recent days. “A number of businessmen including Loai Nasser, Mansour al-Balawi, Zuhair Fayez and Abdulrahman Fakieh also were rounded up in recent days, the people said. Attempts to reach the businessmen or their associates were unsuccessful.”

It isn’t clear if those people are all accused of wrongdoing, or whether some of them have been called in as witnesses. But their detainment signals an intensifying high-stakes campaign spearheaded by Saudi Arabia’s 32-year-old crown prince, Mohammed bin Salman. There appear to be three scenarios behind MbS’ decision to go after the military: 1) They are corrupt and the entire process is all above board and he is doing the right thing by cleaning house; 2) They are wealthy and thus capable of being extorted (a cost of being free) to add to the nation’s coffers; or 3) There is a looming military coup and by cutting off the head, he hopes to quell the uprising. If we had to guess we would weight the scenarios as ALL true with the (3) becoming more likely, not less.

So far over 200 people have been held without charges since the arrests began on November 4th and almost 2000 bank accounts are now frozen, which could be why, as The Daily Mail reports, Saudi prince and billionaire Al-Waleed bin Talal has reportedly put two luxury hotels in Lebanon up for sale after being detained in his country during a corruption sweep. The Saudi information ministry previously stated the government would seize any asset or property related to the alleged corruption, meaning the Savoy hotel could well become the state property of the kingdom. ‘The accounts and balances of those detained will be revealed and frozen,’ a spokesman for Saudi Arabia’s information ministry said. ‘Any asset or property related to these cases of corruption will be registered as state property.’

Read more …

France and Germany play completely different roles. Hariri has said he will return to Lebanon by Wednesday.

Hariri Arrives in Paris With Family Amid Saudi-Iran Tensions (BBG)

Saad Hariri arrived in France with his family amid mounting concern that his country, Lebanon, may once again turn into a battleground for a showdown between Saudi Arabia and Iran. The Lebanese prime minister and his family were invited to France by President Emmanuel Macron. French officials say they can’t say how long Hariri will stay. On Saturday, Macron and Hariri will meet at noon for talks, following which the Lebanese leader and his family will have lunch at the Elysee Palace. Hariri, 47, hasn’t returned to Lebanon since his shock resignation announcement from Saudi Arabia on Nov. 4, which sparked fears of an escalating regional conflict between the kingdom and Iran. The Saudi government has denied accusations it was holding Hariri against his will. The kingdom recalled its ambassador to Germany in response to comments made by Foreign Minister Sigmar Gabriel.

Hariri weighed in on the spat, suggesting that Gabriel has accused the kingdom of holding him hostage. “To say that I am held up in Saudi Arabia and not allowed to leave the country is a lie. I am on the way to the airport, Mr. Sigmar Gabriel,” he said on Twitter. In limited public comments and on Twitter, Hariri has sought to dispel speculation that Saudi Arabia asked him to resign because he wouldn’t confront Hezbollah, an Iranian-backed Shiite Muslim group that plays a key role in Lebanon’s fragile government. The group is considered a terrorist organization by countries including Israel and the U.S., and it has provided crucial military support to President Bashar al-Assad’s regime in Syria’s war.

Macron, who met with Saudi Arabia Crown Prince Mohammed bin Salman in Riyadh, said last week that the two agreed that Hariri “be invited for several days to France.” He also reiterated France’s pledge to help protect Lebanon’s “independence and autonomy.” Hariri will be welcomed in France “as a friend,” Foreign Minister Jean-Yves Le Drian said a press conference in Riyadh on Thursday after meeting with Saudi authorities. French officials have said they still regard Hariri as Lebanon’s prime minister since the country’s president, Michel Aoun, rejected his resignation on the grounds that it must be handed over on Lebanese soil.

Read more …

And if you weren’t confused enough yet, there’s this:

Qatar Says It Has US Backing in Lingering Gulf Crisis (BBG)

Qatar’s foreign minister said the tiny emirate has U.S. backing to resolve the ongoing crisis with a Saudi-led alliance, but the country is also prepared should its Gulf Arab neighbors make military moves. The Trump administration is encouraging all sides to end the dispute and has offered to host talks at the Camp David presidential retreat, but only Qatar has agreed to the dialogue, Foreign Minister Sheikh Mohammed Al-Thani said Friday. Four countries in the Saudi-led bloc severed diplomatic and transport links with Qatar in June, accusing it of backing extremist groups, a charge Doha has repeatedly denied. Saudi Arabia closed Qatar’s only land border. Sheikh Mohammed said he will meet Secretary of State Rex Tillerson next week after having talks this week with Senate Foreign Relations Committee chairman Bob Corker and ranking member Ben Cardin as well as other congressional leaders.

“The Middle East needs to be addressed as the top priority of the foreign policy agenda of the United States,” he told reporters in Washington on Friday. “We see a pattern of irresponsibility and a reckless leadership in the region, which is just trying to bully countries into submission.” The Middle East has been a key foreign policy issue for the Trump administration, with much of it centered around support for the Saudis. The White House has backed the kingdom’s “anti-corruption” campaign that has ensnared top princes and billionaires once seen as U.S. allies, it has provided support for the Saudis in their war in Yemen and it has been muted in criticism of the crisis sparked when Lebanon’s prime minister unexpectedly resigned this month while in Saudi Arabia. Meanwhile, mediation attempts by Kuwait and the U.S. have failed to settle the spat with the Saudi-led bloc and Qatar.

Sheikh Mohammed accused Saudi Arabia of interfering in other countries’ affairs, citing the resignation of Lebanese Prime Minister Saad Hariri as an example of the oil-rich kingdom’s overreach and warning that other countries could be next. Asked about the prospect of the Saudi-led bloc taking military action, Sheikh Mohammed said though Qatar hopes that won’t happen, his country is “well-prepared” and can count on its defense partners, including France, Turkey, the U.K. and the U.S., which has a base in Qatar. “We have enough friends in order to stop them from taking these steps,” but “there is a pattern of unpredictability in their behavior so we have to keep all the options on the table for us,” he said. On the U.S. military presence, “if there is any aggression when it comes to Qatar, those forces will be affected,” he added.

Read more …

There is nothing secret about land tax. Nor is it anything new. It can be implemented tomorrow morning.

House Prices Aren’t The Issue – Land Prices Are (G.)

While reporting on the recent court case where controversial landlord Fergus Wilson defended (but lost) his right to refuse to let to Indians and Pakistanis, I learned something about how he’s now making money. He is now far from being Britain’s biggest buy-to-let landlord. He’s down to 350 homes, from a peak of 1,000. And what’s he doing with the cash made from sales? Buying agricultural land close to Kent’s biggest towns. One plot he bought for £45,000 is now worth, he boasted, £3m with development permission. And therein lies the reason why we have a housing crisis.

As long ago as 1909, Winston Churchill, then promoting Lloyd George’s “people’s budget” and its controversial measures to tax land, told an audience in Edinburgh that the landowner “sits still and does nothing” while reaping vast gains from land improvements by the municipality, such as roads, railways, power from generators and water from reservoirs far away. “Every one of those improvements is effected by the labour and the cost of other people … To not one of those improvements does the land monopolist contribute, and yet by every one of them the value of his land is sensibly enhanced … he contributes nothing even to the process from which his own enrichment is derived.”

When Britain’s post-war housebuilding boom began, it was based on cheap land. As a timely new book, The Land Question by Daniel Bentley of thinktank Civitas, sets out, the 1947 Town and Country Planning Act under Clement Attlee’s government allowed local authorities to acquire land for development at “existing use value”. There was no premium because it was earmarked for development. The New Towns Act 1946 was similar, giving public corporation powers to compulsorily purchase land at current-use value. The unserviced land cost component for homes in Harlow and Milton Keynes was just 1% of housing costs at the time. Today, the price of land can easily be half the cost of buying a home..

Read more …

Democracy in 2017.

ECB Denies EU Auditors Access To Information On Greek Bailouts (EuA)

The European Central Bank (ECB) challenged an attempt by the European Court of Auditors (ECA), the watchdog of EU finances, to examine the Bank’s role in the Greek bailout and reform programmes and refused to provide access to some requested information, citing banking confidentiality. The European Court of Auditors published a report assessing the effectiveness and results of the Greek bailouts on Thursday (16 November). “In line with the ECA’s mandate to audit the operational efficiency of the management of the ECB, we have attempted to examine the Bank’s involvement in the Greek Economic Adjustment Programmes. However, the ECB questioned the Court’s mandate in this respect,” the report reads. The auditors examined the role of the European Commission and found some shortcomings in its approach, which they said overall lacked transparency.

They made a series of recommendations to improve the design and implementation of the Economic Adjustment Programmes. “These recommendations have been accepted in full,” the report said. However, the ECB had invoked the banking confidentiality and denied access to specific information. “It [ECB] did not provide sufficient amount of evidence and thus we were unable to report on the role of the ECB in the Greek programmes,” the auditors said. The report pointed out that the European Parliament had specifically asked the Court to analyse the role of the ECB in financial assistance programmes. It noted that EU auditors had faced similar problems with obtaining evidence from the ECB when reviewing the Single Supervisory Mechanism.

The report highlighted the ECB’s decision on 4 February 2015 to suspend the waiver for accepting Greek government bonds as loan collateral, thereby automatically increasing short-term borrowing costs for the banks. That happened during the tough negotiations between Greece’s leftist government and its international lenders before the third bailout. Many believed it was meant to put additional pressure on Alexis Tsipras’ government to back down and respect the obligations undertaken by the country’s previous governments.

Read more …

It just gets crazier all the time. If your intention was to make sure an economy slowly dies, this is the way to go.

“Retirees on low pensions will effectively have to return the handout they get in late December at the end of January..”

Greek Pensioners Forced To Return ‘Social Dividend’ (K.)

Salary workers, retirees on low pensions, property owners and families with three or more children will bear the brunt of the new austerity measures accompanying the 2018 budget, which come to 1.9 billion euros. Next year the primary budget surplus will have to rise to 3.5% of GDP, therefore more cuts will be required, with low-income pensioners – the recipients of next month’s so-called “social dividend” – set to contribute most, according to the new measures. Retirees on low pensions will effectively have to return the handout they get in late December at the end of January, as the cost of pension interventions according to the midterm fiscal strategy plan amounts to 660 million euros. This is just 60 million euros shy of the social dividend’s 720 million euros that Prime Minister Alexis Tsipras promised this week.

The new measures for 2018 are set to be reflected in the final draft of the budget that is to be tabled in Parliament on Tuesday. They are likely to further increase the amount of expired debts to the state, after the addition of 34 billion euros from unpaid taxes and fines in the last three years, owing to the inability of most taxpayers to meet their obligations to the tax authorities. Plans for next year provide for the further reduction of salaries in the public sector in the context of the single salary system, additional cuts to pensions and family benefits, as well as the abolition of the handout to most low-income pensioners (EKAS). Freelance professionals are also in for an extra burden in 2018, due to the increase in their social security contributions that will be calculated on the sum of their taxable incomes and the contributions they paid in 2017.

Read more …

The UN should be all over this.

UK Considers Tax On Single-Use Plastics To Tackle Ocean Pollution (G.)

The chancellor, Philip Hammond, will announce in next week’s budget a “call for evidence” on how taxes or other charges on single-use plastics such as takeaway cartons and packaging could reduce the impact of discarded waste on marine and bird life, the Treasury has said. The commitment was welcomed by environmental and wildlife groups, though they stressed that any eventual measures would need to be ambitious and coordinated. An estimated 12m tonnes of plastic enters the oceans each year, and residues are routinely found in fish, sea birds and marine mammals. This week it emerged that plastics had been discovered even in creatures living seven miles beneath the sea. The introduction just over two years ago of a 5p charge on single-use plastic bags led to an 85% reduction in their use inside six months.

Separately, the environment department is seeking evidence on how to reduce the dumping of takeaway drinks containers such as coffee cups through measures such as a deposit return scheme. Announcing the move on plastics, the Treasury cited statistics saying more than a million birds and 100,000 sea mammals and turtles die each year from eating or getting tangled in plastic waste. The BBC series Blue Planet II has highlighted the scale of plastic debris in the oceans. In the episode to be broadcast this Sunday, albatrosses try to feed plastic to their young, and a pilot whale carries her dead calf with her for days in mourning. Scientists working with the programme believed the mother’s milk was made poisonous by pollution. The call for evidence will begin in the new year and will take into account the findings of the consultation on drinks containers.

Tisha Brown, an oceans campaigner for Greenpeace UK, said the decades-long use of almost indestructible materials to make single-use products “was bound to lead to problems, and we’re starting to discover how big those problems are”. She said: “Ocean plastic pollution is a global emergency, it is everywhere from the Arctic Ocean at top of the world to the Marianas trench at the bottom of the Pacific. It’s in whales, turtles and 90% of sea birds, and it’s been found in our salt, our tap water and even our beer.

Read more …

It’s either Christ or Santa Claus. Makes sense.

Irish Catholic Priest Urges Christians To Abandon The Word Christmas (G.)

An Irish Catholic priest has called for Christians to stop using the word Christmas because it has been hijacked by “Santa and reindeer”. Father Desmond O’Donnell said Christians of any denomination need to accept Christmas now has no sacred meaning. O’Donnell’s comments follow calls from a rightwing pressure group for a boycott of Greggs bakery in the UK after the company replaced baby Jesus with a sausage roll in a nativity scene. “We’ve lost Christmas, just like we lost Easter, and should abandon the word completely,” O’Donnell told the Belfast Telegraph. “We need to let it go, it’s already been hijacked and we just need to recognise and accept that.”

O’Donnell said he is not seeking to disparage non-believers. “I am simply asking that space be preserved for believers for whom Christmas has nothing to do with Santa and reindeer. “My religious experience of true Christmas, like so many others, is very deep and real – like the air I breathe. But non-believers deserve and need their celebration too, it’s an essential human dynamic and we all need that in the toughness of life.”

Read more …

Mar 242015
 
 March 24, 2015  Posted by at 10:02 am Finance Tagged with: , , , , , , ,  9 Responses »


William Henry Jackson Tamasopo River Canyon, San Luis Potosi, Mexico 1890

About a month ago, Japan’s giant GPIF pension fund announced it had started doing in Q4 2014, what PM Abe had long asked it to: shift a large(r) portion of its investment portfolio from bonds to stocks. No more safe assets for the world’s largest pension fund, or a lot less at least, but risky ones. For Abe this promises the advantage of an economy that looks healthier than it actually is, while for the fund it means that the returns on its investments could be higher than if it stuck to safe assets. Not a word about the dangers, not a word about why pensions funds were, for about as long as they’ve been in existence, obliged by law to only hold AAA assets. This is from February 27:

Japan’s GPIF Buys More Stocks Than Expected In Q4; Slashes JGBs

Japan’s trillion-dollar public pension fund bought nearly $15 billion worth of domestic shares in the fourth quarter, more than expected, while slashing its Japanese government bond holdings as Prime Minister Shinzo Abe prods the nation to take more risks to spur economic growth. The bullishness toward Japanese equities by the Government Pension Investment Fund, the world’s biggest pension fund, boosted hopes in the Tokyo market that stocks have momentum to add to their 15-year highs.

GPIF said on Friday its holdings of domestic shares rose to 19.8% of its portfolio by the end of December from 17.79% at the end of September. Yen bonds fell to 43.13% from 48.39%. Adjusting for factors such as the Tokyo stock market’s rise of roughly 8% during the quarter, GPIF bought a net 1.7 trillion yen ($14 billion) of stocks in the period, reckons strategist Shingo Kumazawa at Daiwa Securities. GPIF’s investment changes are closely watched by markets, as a 1 percentage-point shift in the 137 trillion yen ($1.15 trillion) fund means a transfer of about $10 billion.

What economic growth can there be in shifting from safe assets to riskier ones? Isn’t economic growth in the end exclusively a measure of how productive an economy is? And isn’t simply shifting your money around between assets a clear and pure attempt to fake growth numbers? Moreover, doesn’t Abe himself indicate very clearly that there is risk involved here, that there is now a greater risk that pension money will have to take losses on its investments? Isn’t he simply stating out loud that he wants to turn the entire nation into a casino? And that without this additional risk there will and can be no economic growth?

It’s time for the Japanese to get seriously scared now. Like many other countries, Japan – and its political class – creates a false image of enduring prosperity by letting its central bank increasingly buy up ever more of its sovereign bonds. It’s a total sleight of hand, there is nothing left that’s real. There’s no there there. This is of course the same as what happens in Europe.

And it’s precisely because central banks buy up all these bonds, that their yields scrape the gutter. It’s a blueprint for killing off the last bit of actual functionality in an economy. All you have from there on in is fake, an artificial boosting of bond prices aimed at creating the appearance of a functioning economy, which can by definition only be a mirage. That it will temporarily boost stock prices in an equally artificial way only goes to confirm that.

But, evidently, artificially high stock prices carry a much greater risk than ones that are based on a free and functioning market and economy. So not only is there a shift from safe to risky assets, there’ s a double whammy in the fact that these large scale purchases boost stocks without having anything to do with the economic performance of the companies whose stocks are bought.

It may make Shinzo Abe look better for a fleeting moment, but for Japan’s pensioners it’s the worst option that is available.

And then last week, a group of smaller rising sun pension funds said they’d follow the example. The more the merrier….

Japan Public Pensions To Follow GPIF Into Stocks From JGBs

Three Japanese public pension funds with a combined $250 billion in assets will follow the mammoth Government Pension Investment Fund and shift more of their investments out of government bonds and into stocks. The three funds and the trillion-dollar Government Pension Investment Fund, the world’s biggest pension fund, will announce on Friday a common model portfolio in line with asset allocations recently decided by the GPIF, the people told Reuters. Assuming, as expected, the three smaller mutual-aid pensions adopt the portfolio, that would mean shifting some 3.58 trillion yen ($30 billion) into Japanese stocks, a Reuters calculation shows.

The GPIF in October slashed its targeted holdings of low-yielding government bonds and doubled its target for stocks, as part of Prime Minister Shinzo Abe’s plan to boost the economy and promote risk-taking. GPIF in October slashed its targeted holdings of low-yielding government bonds and doubled its target for stocks, as part of Prime Minister Shinzo Abe’s plan to jolt Japan out of two decades of deflation and fitful growth and promote risk-taking. The shift to riskier investments by the 137 trillion yen ($1.1 trillion) GPIF has helped drive Tokyo Stocks to 15-year highs this week because of the fund’s size and because it is seen as a bellwether for other big Japanese institutional investors. The new model portfolio, part of a government plan to consolidate Japan’s pension system in October, will match the new GPIF allocations of 35% in Japanese government bonds, 25% in domestic stocks, 15% in foreign bonds and 25% in foreign stocks, the sources said.

Half of Japan’s pension money will be in stocks, domestic and foreign. And what do you think that means if and when there’s a major stock market crash – which is historically inevitable?

Never give a government any say in either your central bank or your pension fund. That’s a very sound lesson that unfortunately everyone seems to have forgotten. At their own peril. Sure, they’re looking like geniuses right now: look, the Nikkei is at a 15-year high! But it’s what’s going to come after that counts. For who believes that this situation can last forever? Or who, for that matter, believes that this head fake will the driver for real economic growth?

Sure enough, now the rest of the region has to follow suit: every pension fund in the region becomes a daredevil. But we know, don’t we, what the rising greenback is about to do to emerging markets that have huge amounts of dollar-denominated debt in their vaults. One thing this won’t do is boost stock markets; it will instead put many companies into either very bad financial straits or outright bankruptcy. And then you will have their pension funds holding a lot of empty bags. From the point of view of major banks this is ideal: this is how they get there hands on everyone’s pension funds, which I once labeled the last remaining store of real wealth.

Pension Funds Shun Bonds Just as Southeast Asia Needs Them Most

The biggest state pension funds in Thailand and the Philippines are shifting money from bonds to stocks, which could push up the cost of government stimulus programs. The Social Security Office and Government Service Insurance System said they’re increasing holdings of shares, while the head of Indonesia’s BPJS Ketenagakerjaan said he sees the nation’s stock index rising 14% by year-end. Rupiah, baht and peso notes have lost money since the end of January, after handing investors respective returns of 13%, 9.9% and 6.6% last year, Bloomberg indexes show.

“There has been frustration among domestic institutional investors about the falling returns on bonds,” Win Phromphaet, Social Security Office’s head of investment in Bangkok, said in a March 19 interview. “Large investors including SSO must quickly expand our investments in other riskier assets.” Appetite for sovereign debt is cooling just as Southeast Asian governments speed up construction plans in response to slowing growth in China and stuttering recoveries in Europe and Japan.

If Thailand and the Philippines, and many other nations in the region, want to speed up their infrastructure projects, their central banks, too, will have to buy up the vast majority of their sovereign bonds. They too will have to fake it. It’s fatally contagious.

And then a few days ago this passed by on the radar. The world’s largest sovereign wealth fund (Norway’s) joins the club. This may seem completely normal to some, either because they don’t give it much thought or because they work in this sort of field (people adopt strange ways of thinking), but for me, it just raises bright red alerts.

Biggest Wealth Fund Targets Tokyo for Next Real Estate Purchase

Norway’s sovereign wealth fund is looking at Tokyo or Singapore for its first real estate investment in Asia as the investor expands globally. “That’s where we think we’ll start,” Karsten Kallevig, the chief investment officer of real estate at the Oslo-based fund, said in an interview after a speech in the Norwegian capital. “If we’re really successful there, then maybe we can add a third and a fourth and a fifth city at some point.” After in 2010 being allowed to expand into the property market, Norway’s $870 billion wealth fund has amassed about $18 billion in real estate holdings. It has snapped up properties in major cities such as New York, London and Paris, with a main focus on office properties. The fund is focusing on specific markets rather than sectors, Kallevig said.

“When we say Singapore and Tokyo, we mean the better parts” of those cities, he said. “My guess is office properties will be the main component, because that’s what’s for sale in those parts of town. There aren’t many shopping malls in the center of Tokyo or the center of Singapore.” Just as in earlier purchases in Europe and the U.S, the fund will also buy properties with partners, Kallevig said. The next trip in that area will probably be in the second quarter, he said. The property portfolio was 141 billion kroner ($17.5 billion), or 2.2% of the fund at the end of last year, compared to 1% at the end of 2013. Real estate returned 10.4% in 2014.

Kallevig has said he seeks to invest 1% of the fund in real estate each year until the 5% goal is met. The Government Pension Fund Global returned 7.6% in 2014, its smallest gain since 2011. The fund has warned it expects diminished returns amid record low, and even negative, yields in key government bond markets combined with slow growth in developed markets. Norway generates money for the fund from taxes on oil and gas, ownership of petroleum fields and dividends from its 67% stake in Statoil ASA. Norway is western Europe’s biggest oil and gas producer. The fund invests abroad to avoid stoking domestic inflation.

Hmm. “The fund invests abroad to avoid stoking domestic inflation.” Really? In today’s zero percent world? Sounds curious. It may have been a valid objective in the past, but not today. What this is really about is chasing yield, just as in the pension fund case. Still, that was not the first thought that came to mind when reading this. That was: If Tokyo real estate were such a great investment, wouldn’t you think that Japan’s own pension funds would be buying? They’re chasing yield like crazy, but they would miss out on their own real estate assets which Norway’s fund thinks are such a great asset?

All this is not just the financial world on steroids, which is bad enough when you talk about someone’s pension, it’s the wrong kind of steroids too. The lethal kind. But then, without steroids the entire economic facade would be exposed as the zombie it has become. It’s insane for pension funds to buy stocks on a wholesale scale, because that distorts an economy beyond the point of recognition, it screws with price discovery like just about nothing else can, and it puts the pensioners’ money in grave danger. It’s equally insane for Norway to buy up property halfway around the world which giant domestic investors leave by the wayside.

Investing your pension money, and your wealth fund, into your own economy is such a more solid and soundproof thing to do, it shouldn’t even be an item up for discussion. Taking that money out of the foundation of an economy, and shifting it either to assets abroad, or into the casino all stock markets must of necessity be in the end, means abandoning and undermining the future strength of your own economy for the sake of a bit more yield today. At home, you could create infrastructure and jobs and resilience with it. All that is gone when you move it either abroad or into a casino.

Still, nothing really functions anymore the way it should. And that’s how you wind up in situations such as these. Central banks monetize debt to such extents, you could swear there’s a race going on. They do this to hide from view the debts that are out there, and that if exposed would make everything look much bleaker than it looks with various QEs and other steroid-based stimuli. In doing this, central banks kill bond yields, which chases pension- and wealth funds out of safe assets. A surefire way to create short term gains and long term losses, if not disaster. For the masses, that is. No losses in store for the few. They get only gains.

Mar 202015
 
 March 20, 2015  Posted by at 8:59 pm Finance Tagged with: , , , , , , , , ,  7 Responses »


DPC Provision store. Caracas, Venezuela 1905

Once again, a look at Greece and the Troika, because it amuses me, it angers me, and also because it warms my cockles, in an entirely metaphorical sort of way. The Troika members love to make it appear (and everyone swallows it whole) as if in their ‘negotiations’ with Greece all sorts of things are cast in stone and have no flexibility at all. Humbug.

First, another great piece by Rob Parenteau (via Yves Smith), who lays it out in terms so simple they can’t but hit the issue square on the nose. For Europe and the Troika, there’s Greece, and then there’s the rest. No money for the Greeks lining up at soupkitchens (not even for the soupkitchens themselves), but $60 billion a month for the bond market. The $200 million anti-poverty law – a measly sum in comparison – that Athens voted in this week is a no-no because Greek government has to ask permission for everything in Brussels first, says Brussels, no matter that that only prolongs the suffering. It’s not about money, in other words, it’s about power, and the Greeks must be subdued.

Both the financial and the political press have by now perfected their picture of Yanis Varoufakis as a combination of some kind of incompetent blunderer on the one hand, and a threat the size of Vladimir Putin on the other, while the rudeness of German FinMin Schäuble is not discussed at all. The media are no longer capable of reporting anything outside of their propaganda models. The ‘middle finger’ video turns out to be a fake, but who cares, it’s done its damage. Parenteau:

Goebbelnomics – Austerian Duplicity and the Dispensing of Greece

So let’s get this straight. The Troika does not have enough money to roll over Greek debt (in a Ponzi scheme like fashion, mind you) – debt that was incurred not so much as a bailout of Greece, but more as a bailout of German and other core nation banks and insurance companies and private investors who made stupid loans to or investments in Greece, but refused to fob them off on their own taxpayers.

But the Troika does have enough money to adequately perform damage control for the eurozone if Greece, because, you know, Greece is a “dispensable” eurozone member – even though ECB lawyers themselves say there is no legal mechanism for disposing of eurozone members in any such fashion.

No money in Greece for humanitarian aid in a country that may be on its way to becoming a failed nation state. No money outside Greece to roll over existing debt, or when necessary to extend and pretend, add more debt on existing debt to service the old debt, Charles Ponzi style. But somehow there is still “sufficient” money to ring fence Greece from the rest of the eurozone once Greece figures out it is dispensable and so must exit.

But that is not even the whole deception. It turns out the ECB does happen to have enough money to buy €60 billion per month of bonds from now until at least September 2016. Which means the same bondholders who are benefitting from the misnamed “bailout” funds used to keep the core nation financial institutions from collapsing under the weight of failed loans, can now count on a monthly government handout, courtesy of the ECB.

Some are more equal than others, in other words. That is true also of Ukraine, which gets to issue bonds guaranteed by the American taxpayer. If Greece could do that, they‘d have a way out of the dark pit austerity has thrown it in. And Greece isn’t even killing its own people…. But then Kiev doesn’t need to be subdued, it’s already being ruled exclusively by US stooges.

To come back to Schäuble lack of basic civil manners for a moment, it’s of course not true that Germany has an ironclad case against the Greek demands for WWII reparations. If it did, none of the rudeness would be necessary. And aside from that, even if the case was indeed closed, Germany would still need to be open and respectful and way more civilized than it is at present. WWII is a very black chapter in world history, and it’s not some very remote event. Even if post-WWII German schoolchildren never learned anything about what their parents and grandparents had done.

Maybe there’s a task here for the world Jewish community. Schäuble’s attitude smacks of denial, much more than respect for victims and their surviving family members. And besides, there were a lot of Greek Jews who became victim of German atrocities.

But to focus for now on the purely legal side of the matter, there’s at the very least a large grey area:

Legal Experts: Greece Has Grounds for WWII Reparations

A growing number of legal experts are supporting Greece’s demands over the German war reparations from the country’s brutal Nazi occupation during World War II. Despite the official German refusal to address the issue, legal experts say now Athens has ground for the case. The hot issue is expected to be brought up by Greece’s newly elected Prime Minister Alexis Tsipras during his official visit to Berlin on Monday, where he is scheduled to hold a meeting with the German Chancellor Angela Merkel. [..]

The Greek leftist-led coalition government has repeatedly raised the issue causing Germany’s firm reaction as expressed by German Finance Minister Wolfgang Schaeuble, who recently warned Athens to forget the war reparations, underlining that the issue has been settled decades ago. Central to Germany’s argument is that 115 million deutschmarks have been paid to Greece in the 1960s, while similar deals were made with other European countries that suffered a Nazi occupation.

At the same time, though, lawyers from Germany and other countries have said the issue is not wrapped up, as Germany never agreed a universal deal to clear up reparations after its unconditional surrender. The German answer on that is that in 1990, before its reunification, the “Two plus Four Treaty” agreement was signed with the United Kingdom, the United States, the former Soviet Union and France, which renounced all future claims. According to Berlin, this agreement settles the issue for other states too.

“The German government’s argument is thin and contestable. It is not permissible to agree to a treaty at the expense of a third party, in this case Greece,” international law specialist Andreas Fischer-Lescano said, as cited by Reuters. Mr. Lescano’s opinion finds several other experts in agreement. One of them, the Greek lawyer Anestis Nessou, who works in Germany highlighted that “there is a lot of room for interpretation. Greece was not asked, so the claims have not gone away.”

Merkel had better start taking the matter very serious, and in a very respectful way to boot. Because no matter how well oiled the publicity spin machine is, Schäuble’s attitude, mirrored by many of his countrymen, will awaken in countries all across Europe the realization that they don’t want this from Germany, they won’t be ruled by Berlin, and they won’t stand for more German uncivilized behavior either. The memories are far too fresh for that.

As I said the other day, Merkel had better take the reins in all this, because she risks blowing up the entire European Union if she lets things slip further. Let Greece go, if only by trying to force it into some sort of debt servitude which the Greek people deem unacceptable on moral grounds, and the EU project will start shaking on its already feeble foundations.

There’s only one thing that can save the Union now: for Merkel to show compassion, with the Greeks, and with all other weaker members. And to stop the anti-Greek propaganda, immediately. Or else. It’s nonsense to pretend that this is merely a business issue, as is made clear by Parenteau above: there is very clearly plenty space to negotiate solutions with Greece that preserve everyone’s dignity. Refuse that, and you can kiss the EU goodbye. There’s alot more that plays into this than mere money issues. Ignore that, and you might as well dismantle the Union right now.

And there are indeed other approaches too. Like that of the German couple, whose story I picked up some 24 hours ago on RT, and which has since appeared on a whole scale of media:

German Couple Pays €875 To Greece For Their Share Of WWII Reparations

A German couple visiting Greece have handed over a check for €875 to the mayor of the seaport town of Nafplio, saying they wanted to make amends for their government’s attitude for refusing to pay Second World War reparations. Nina Lahge, who works a 30-hour week, and Ludwig Zacaro, who is retired, made the symbolic gesture and explained that the amount of €875 would be the amount one person would owe if Germany’s entire war debt was divided by the population of 80 million Germans.

“If we, the 80 million Germans, would have to pay the debts of our country to Greece, everyone would owe €875 euros. In [a] display of solidarity and as a symbolic move we wanted to return this money, the €875 euros, to the Greek population,” they said.

They apologized for not being able to afford to pay for both of them. “We are ashamed of the arrogance, which our country and many of our fellow citizens show towards Greece,” they told local media in Nafplio, southern Greece. The Greek people are not responsible for the fiasco of their previous governments, they believe.

“Germany is the one owing to your country the World War II reparation money, part of which is also the forced loan of 1942,” they added. The couple was referring to a loan which the Nazis forced the Greek central bank to give the Third Reich during the WWII thus ruining the occupied country’s economy. The mayor of Nafplio, Dimitris Kotsouros, said the money had been donated to a local charity.

And a perhaps even better story comes, almost entirely under the radar, through Kathimerini. Turns out, where Brussels and Berlin spend their time blaming Tsipras and Varoufakis for everything that happens, Norway, not an EU or eurozone member, steps in to alleviate the worst of the suffering:

Athens Mayor Unveils Scheme To Support Poor With Help From Norway

Athens Mayor Giorgos Kaminis, Norwegian Ambassador Sjur Larsen and the president of nongovernmental organization Solidarity Now, Stelios Zavvos, on Wednesday inaugurated a new program to provide support to the Greek capital’s poor. The Solidarity & Social Reintegration scheme comprises a food program benefiting 3,600 households, as well as a space provided by City Hall and managed by Solidarity Now where the organization will provide social, medical and legal aid, among other services.

“The aim is the immediate relief of those in need by providing food, medical care, social services, legal support, help finding employment, and support for single-parent families, children and other vulnerable groups,” said Larsen, whose country has donated 95.8% of the €4.3 million needed to fund the program. The other donors are Iceland and Liechtenstein.

Note: Brussels and the IMF have refused to do what Norway does. They have also refused to let the elected Greek government take care of its own people, without first asking permission to do so. It’s an insane situation, if you ask me. And I don’t see why the Greeks would stand for it any longer. If they vote to leave the eurozone, and perhaps the EU, they will have a hard time for a while, for sure, and it will be made much harder by the Troika, simply out of spite.

But they would face an at least equally hard time if they choose to stay inside the shackles Brussels and Berlin want to lock them in. The EU is supposed to be made up of independent nations. And while it’s certainly true that that is perhaps its fatal flaw, trying to take away that status from the Greeks will drive them away, and warn other countries as well that they could be next in line for the same shackles.

We’re looking at economic warfare here, and there can be no doubt that it will end with only losers on all sides. Unless Merkel wakes up and smells the roses.