Oct 032018
 
 October 3, 2018  Posted by at 9:30 am Finance Tagged with: , , , , , , , , , , , ,  


Paul Gauguin The ford 1901

 

Fed’s Powell Says US Outlook ‘Remarkably Positive’ (R.)
Another Market Volatility Surge Is Likely Ahead (Colombo)
White House Responds To “Misleading” NYTimes’ Trump Tax Fraud Story (ZH)
Italy Folds To Europe On Budget Deficit; Euro Surges (ZH)
Merkel’s End Could Spark EU Breakdown (Luongo)
Vancouver Home Sales Crash 44% As “For Sale” Inventory Soars (ZH)
Australia Banking Royal Commission Could Trigger House Price Collapse (ABC.au)
DMZ Demining Operations Lay Groundwork For Korean Peninsula Peace (YH)
Russia May Veto Greece-FYROM Name Deal at the UN (GR)
The Case For Paying Every American A Dividend On The Nation’s Wealth (MW)
Restaurants In Austin Banned From Throwing Away Food (Hill)
‘We Have Found Hell’: Trauma Runs Deep For Children At Dire Lesbos Camp (G.)

 

 

First, here’s Ted Koppel agreeing with me that Trump Sells Better Than Sex, and Stelter really doesn’t understand:

 

 

And then he closed the spigots…

Fed’s Powell Says US Outlook ‘Remarkably Positive’ (R.)

U.S. Federal Reserve Chairman Jerome Powell on Tuesday hailed a “remarkably positive outlook” for the U.S. economy that he feels is on the verge of a “historically rare” era of ultra-low unemployment and tame prices for the foreseeable future. It is a view, he said, based on how a changed economy is operating today, with businesses and households immunized by strong central bank policy from the inflationary psychology that caused unemployment, inflation and interest rates to swing wildly in the 1960s and 1970s. It is an outlook that includes an economic performance “unique in modern U.S. data,” with unemployment of below 4 percent expected for at least two more years and inflation remaining modest even as wages rise.

And it is an outlook he feels will even survive the Trump administration’s efforts to rewrite the global trading system, a policy shift Powell said may lead to one-time price hikes, but not to persistent changes in the annual rate of inflation going forward. “This forecast is not too good to be true,” Powell told the National Associate for Business Economics, but instead “is testament to the fact that we remain in extraordinary times.” “These developments amount to a better world for households and businesses which no longer experience or even fear the scourge of high and volatile inflation.”

Read more …

There can be no doubt.

Another Market Volatility Surge Is Likely Ahead (Colombo)

The U.S. stock market is climbing to record highs once again and volatility has calmed down dramatically from its panic-induced levels reached earlier this year. Traders have become complacent as they passively ride the stock market higher and bet on lower volatility again. While it may seem like all is well, several reliable indicators are warning that another powerful volatility surge is likely ahead.

The first indicator is the 10-year/2-year Treasury spread that is calculated by subtracting the 2-year Treasury note yield from the 10-year Treasury note yield. The 10-year/2-year Treasury spread is helpful for estimating when the next recession is likely to occur, as I explained in a recent Forbes piece. The chart below (which I recreated from a chart made by BofA’s Savita Subramanian) shows that the inverted 10-year/2-year Treasury spread leads the CBOE Volatility Index or VIX by approximately three years. If this historic relationship holds true, we are about to experience a whole lot more volatility over the next few years.

The next chart shows the positioning of the “smart money” and “dumb money” in the Volatility Index or VIX futures. The “smart money”, or commercial futures hedgers (who tend to be right at major market turning points), are building up another bullish position in VIX futures, just like they did one year ago ahead of the stock market correction and volatility spike. In addition, the “dumb money”, or large traders (who tend to be wrong at major turning points), have built up a large short position, like they did before the early-2018 volatility spike. The positioning of these groups of traders indicates that another volatility spike is likely ahead in the not-too-distant future.

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Decades old, started when Trump was a toddler, good luck. Of course they pay as little as they can, but once the IRS signs off on it…

White House Responds To “Misleading” NYTimes’ Trump Tax Fraud Story (ZH)

Update 2: The White House has finally responded to the NYTimes story…(via Sarah Sanders) “Fred Trump has been gone for nearly twenty years and it’s sad to witness this misleading attack against the Trump family by the failing New York Times. Many decades ago the IRS reviewed and signed off on these transactions. The New York Times’ and other media outlets’ credibility with the American people is at an all time low because they are consumed with attacking the president and his family 24/7 instead of reporting the news.

The truth is the market is at an all-time high, unemployment is at a fifty year low, taxes for families and businesses have been cut, wages are up, farmers and workers are empowered from better trade deals, and America’s military is stronger than ever, yet the New York Times can rarely find anything positive about the President and has tremendous record of success to report. Perhaps another apology from the New York Times, like the one they had to issue after they got the 2016 election so embarrassingly wrong, is in order.”

The NYT reported that Trump and his siblings set up a “sham” corporation to help disguise otherwise taxable income that came from gifts from their parents. The president also allegedly helped his father take improper tax deductions that amounted to millions of dollars and helped formulate strategy to undervalue his parents’ real estate holdings, with the Internal Revenue Service reportedly providing little pushback against the Trumps’ reported tactics. According to the leaked confidential filings, Trump’s parents left more than $1 billion to their children, which would have resulted in a roughly $550 million tax bill at the time.

However, the Trumps paid a total of $52.2 million on that source of income, according to the NYT report. To achieve this, the newspaper cited records that showed Trump helped undervalue his father’s real estate holdings, which led to a lower tax bill when he and his siblings inherited the properties. In total, Trump received the equivalent today of at least $413 million from his father’s real estate empire, based on questionable tax dealings starting when he was a toddler and continuing to this day. And, in what will attract the most attention, the newspaper wrote that Trump’s behavior amounted to fraud in some cases.

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I don’t think this one’s over yet.

Italy Folds To Europe On Budget Deficit; Euro Surges (ZH)

After two days of brutal punishment by the markets which sent Italian bond yields to 4 years highs and slammed the euro, the Italian government appears to have folded to pressure from Brussels (and the one place in the world where the bond vigilantes still operate, just ask Sylvio Berlusconi), and according to Corriere della Sera, Italy’s draft budget plan will pledge to cut the deficit to 2% in 2021, after Rome reversed a proposal to maintain a 2.4% shortfall in the face of pressure from the EU. As a result, while the 2019 deficit will still rise to 2.4% of GDP in 2019, it will decline by 0.2% to 2.2% in 2020, and another 0.2% the year after. In kneejerk reaction, futures lept to fresh session highs, Treasury yields jumped by 2bps to 3.07% and the EURUSD spiked 50 pips higher to 1.1590.

Italy is not out of the woods yet though: according to Mizuho, the sustainability of the euro’s rebound will depend on whether the EU sees Italy’s latest budget plan as appropriate. It could be that Italy has already made compromise with the EU, but hard to predict whether the euro’s rebound has more legs until we see a reaction from the EU: “It all boils down to the EU’s response”, and if the ongoing war of words is any indication, merely promising to trim the deficit in the next three years will hardly be smiled upon. Others were even more skeptical. According to bond fund manager Daintree Capital, “The euro’s definitely reacting to the headlines on Italian budget plans, and it will continue to do so for future headlines.” However, “anyone who believes a populist government is all of a sudden going to be particularly responsible in a fiscal sense, has a misguided view.”

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Merkel’s losing it.

Merkel’s End Could Spark EU Breakdown (Luongo)

I saw a recent poll from Die Welt which has Alternative for Germany (AfD) creep past Merkel’s Grand Coalition partner, the Social Democrats (SPD), and challenge the CDU itself. Because when you back out the Christian Social Union’s (CSU) total which runs between 8% and 9% AfD is now in a position to become the party with the highest backing in Germany. And this is happening on the eve of Bavarian State elections this month. [..] I’ve talked about AfD’s chances to achieve this result in the past in terms of them crossing the 16% Chasm. And it appears, that slowly, they are doing so. German politics, from what I understand, is not used to this kind of upheaval and certainly not these kinds of leadership challenges. Earlier this year Merkel barely survived a challenge by former CSU Leader Horst Seehofer over immigration.

So, where to things go from here? As Mercouris points out, Merkel has very skillfully gutted the landscape of the CDU to keep potential leaders from emerging within the party. The SPD is falling off a cliff having lost more than half of its support since the 2014 elections. And the CSU is primarily a Bavarian party so they don’t have the support of the entirety of Germany. This landscape is why we’ve seen the Greens rise to 15% as well as AfD’s rise. And that cannot be ignored. The hard left of German politics is now split and ineffectual. But, no party has emerged in this chaos to take the reins of power.

This is reminding me of Italy’s situation at the end of 2017 with no less than five parties polling in double digits. It’s a messy situation and it makes more sense in Germany that big shifts in voter preference would occur at a slower rate given the stability of German coalition governments since the modern state was founded after World War II. In other words Germans are loathe to make these kinds of changes. So, you know the situation must be bad if these numbers are changing this quickly. So, it shouldn’t be much of a surprise really to see this type of breakdown and the slow rise of AfD past the 16% chasm. It may be the riots in Chemnitz that finally begin pushing their poll numbers into the 20’s nationally.

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Glass half full: “”There’s more selection for home buyers to choose from today.”

Vancouver Home Sales Crash 44% As “For Sale” Inventory Soars (ZH)

What happens when prices rise so high that a chasm forms between bids and asks? The market grinds to a halt. That’s what happened in Vancouver housing in September, when according to the Real Estate Board of Vancouver (REBGV), residential property sales tumbled by 17.3% from August 2018, and a whopping 43.5% from one year ago. In fact, a total of only 1,595 transactions took place as both buyers and sellers continue to sit on their hands amid confusion whether the recent torrid price gains will continue or whether the housing bubble has burst. Sales of detached properties in July was just 508, a decrease of 40.4% from the 852 recorded in September 2017, and the 812 apartments sold was a 44% drop compared to the 1,451 sales in September 2017.

And no, it’s not seasonal: last month’s sales were a whopping 36.1% below the 10-year September sales average. The reason for the collapse in transactions: the formerly all too willing buyers, mostly Chinese oligarchs who would use Vancouver real estate as their offshore Swiss bank account, have disappeared. Meanwhile sellers are dumping properties in the market in hopes of a quick flip. “Fewer home sales are allowing listings to accumulate and prices to ease across the Metro Vancouver housing market,” Ashley Smith, REBGV president-elect said. “There’s more selection for home buyers to choose from today. Since spring, home listing totals have risen to levels we haven’t seen in our market in four years.”

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What would we do without our housing bubble?

Australia Banking Royal Commission Could Trigger House Price Collapse (ABC.au)

There is a lot riding on the policy recommendations from the banking royal commission, not least of which is the stability of the Australian property market, according to some respected analysts. Independent economist Saul Eslake said there was potential for the royal commission’s recommendations to have what economists refer to as “unintended consequences”. The unintended consequences Mr Eslake is referring to include a steep fall in house prices spurred on by a royal commission-inspired clampdown on bank lending. Capital Economics chief economist Paul Dales said while house price falls to date have been small, Australia could be in for a record housing decline, at least in its recent history.

“At the moment the trajectory is a bit worrying cause the house prices seem to be declining at a faster rate and, in our view at Capital Economics, this will eventually prove to be the largest downturn in Australia’s modern history,” he said. Mr Dales is forecasting a protracted slowdown in the housing market as a result of a crackdown in bank lending standards, the banking royal commission itself and rising interest rates. “There’s significant time delays with these things,” he said. “I would have thought over the next six to 12 months is where we would, if there was going to be a big pullback in lending, that’s when we would see it and then, thereafter as and when the royal commission makes any recommendations and the Government implements them, the next six to 12 months after that.

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Korea’s move on.

DMZ Demining Operations Lay Groundwork For Korean Peninsula Peace (YH)

After a 15-minute bumpy ride along a dusty, hilly path inside the Demilitarized Zone (DMZ), dozens of South Korean troops in full gear disembarked near a grisly site of intense battles during the 1950-53 Korean War. Accompanying them in the buffer zone separating the two Koreas was a phalanx of security guards, medical specialists and other personnel specializing in disposing of unidentified explosives and excavating war remains. They are part of the 120-member team tasked with removing landmines in the Arrowhead Ridge, or Hill 281 in Cheorwon, some 90 kilometers northeast of Seoul — a site that the two Koreas have designated for a joint project to retrieve war remains from April to October next year.

There were three key battles against communist forces on the notorious ridge from 1952-53. The remains of more than 200 South Korean soldiers and dozens of U.N. Command (UNC) forces, such as U.S. and French troops, are thought to be buried in it. “We have made preparations (for the landmine removal) for a long period and are well prepared now,” the commander in charge of the frontline areas told reporters on condition of anonymity on Tuesday, the second day of the demining work set to continue until Nov. 30. “We will not rush and will carry out our mission with the first and foremost priority placed on the safety of our troops,” he added.

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EU and NATO want to keep pushing, but how about democracy?

Russia May Veto Greece-FYROM Name Deal at the UN (GR)

Russia is implicitly threatening that it may block the Prespa agreement at the UN Security Council. In a statement on Monday, following the referendum in FYROM, the Russian foreign ministry says that the low turnout “means that the referendum cannot be recognised as valid.” It clearly indicates that the voters “chose to boycott the solutions imposed on Skopje and Athens.” The statement also blasts leading politicians from NATO and EU member states who participated in “large-scale propaganda campaign directly, freely interfering in the internal affairs of this Balkan state.” Despite the low turnout, Prime Minister Zoran Zaev vowed to push ahead with the name change on Monday.

The Russian foreign ministry condemned the move: “There is a clear drive to ensure Skopje’s entanglement in NATO despite the will of the Macedonian people.” Russia is traditionally wary of NATO’s enlargement in eastern Europe. The alliance’s 1999 bombings of its ally Serbia caused a major rift in Russia’s relations with the West at the time. Moscow says that a long-term solution can only be agreed upon by the two parties on their own, without any external interference, and only within the framework of the law and with broad public support.

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Inequality in Europe rises fast, too. Where are the breaking points?

The Case For Paying Every American A Dividend On The Nation’s Wealth (MW)

The newest research shows that unconditional cash transfers boost work productivity and quality of life, including better mental and physical health, and reduce crime. A study by the Roosevelt Institute in New York, a left-leaning think tank, concludes that giving $500 a month to every adult American could meaningfully grow the U.S. economy and address its widening wealth gap. (The top 1% of Americans now receive 20% of the national income, while those in the bottom 50% receive 13%; in 1980, the numbers were essentially reversed, at 11% and 20%, respectively, according to the 2018 World Inequality Report.)

Yet basic income in the U.S., characterized as a utopian solution by its true believers but as welfare, socialism or worse by its detractors, has gone nowhere. Basic income did enjoy a bit of a heyday in the U.S. in the 1960s and 1970s and was even embraced in conservative circles; free-market economist Milton Friedman went so far in 1962 as to propose a negative federal income tax that would guarantee a basic income to the poorest Americans while also incentivizing work. Other ideals of the era — the four-day workweek, the 30-hour workweek, the all but limitless vacation allotment — have fallen by the wayside, even as U.S. labor conditions have worsened.

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In France, this is a nation-wide law.

Restaurants In Austin Banned From Throwing Away Food (Hill)

Restaurants in Austin, Texas, will no longer be allowed to throw out food waste, the city announced this week. Under a new policy that began Monday, all food-permitted businesses in the city are required to keep organic material, such as food scraps and soiled paper products, from landfills. Businesses can dispose of their food waste by donating extra food, giving scraps to local farms for animals, or composting, the city government said in a press release announcing the policy.

The city’s Universal Recycling Ordinance also requires businesses to provide employees with training on organic waste diversion, and to post information about the plan. Official city data shows that 37 percent of material sent to landfills is organic and could have otherwise been donated or composted, the city said. Austin’s ordinance is the latest move by a major city to introduce eco-friendly policies. Dozens of cities and businesses nationwide have banned plastic straws and other single-use plastic items in an effort to cut down on waste.

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Welcome to Europe.

‘We Have Found Hell’: Trauma Runs Deep For Children At Dire Lesbos Camp (G.)

The drawings tell of trauma. Stormy seas dotted with terrified faces. Lifeless bodies of children floating among the waves. And planes dropping bombs, down on to homes and on to people. Eyes that weep blood. The pencil scrawls were made by children who are part of a growing phenomenon in the Moria refugee camp in Lesbos, Greece. All have attempted suicide or serious self-harm since they came to this place. Approximately 3,000 minors live in the Moria camp, which Médecins Sans Frontières (MSF) calls a giant open-air “mental asylum” owing to the overcrowding and dire sanitary conditions. Last Tuesday an adolescent attempted to hang himself from a pole. In August, a 10-year-old boy only just failed to take his own life.

The camp, among hills dotted with olive trees a few kilometres from the island’s capital town of Mytilene, is home to 9,000 asylum seekers living in a centre designed to hold one third of that number. Migrants live in groups of up to 30 people, crammed into tents or metal containers situated just centimetres apart. Rubbish, scattered everywhere, makes the air almost unbreathable. Most come from war-torn countries like Syria, Iraq and Afghanistan. They arrive in dinghies from the Turkish towns of Ayvalik or Canakkale. According to aid agencies, the controversial deal brokered between Brussels and Ankara aimed at stopping the flow of migrants to Europe via Turkey, combined with the refusal on the part of European countries to take in asylum seekers arriving in Greece, have transformed Lesbos into an Alcatraz, leaving people imprisoned on the island with no way out.

“Although the vast majority of migrants who arrive in Moria are traumatised, after having fled from violent conflicts in their home countries, conditions in the camp have exacerbated their trauma,” says Luca Fontana, field coordinator of MSF on the island. “After two years, some are still awaiting transferral, even if they know they could be deported to Turkey at a moment’s notice. I’ve worked in camps infested with Ebola in Sierra Leone and Guinea, but I guarantee you that this is the worst situation I’ve ever seen.”

Read more …

Sep 222018
 
 September 22, 2018  Posted by at 9:21 am Finance Tagged with: , , , , , , , , , , ,  


René Magritte Memory of a voyage 1955

 

Rosenstein Proposed Secretly Recording Trump, Invoking 25th Amendment (ZH)
NY Times, McCabe Give Trump Perfect Cover To Fire Rosenstein, Sessions (Hill)
Grassley Extends Deadline On Kavanaugh Accuser’s Decision To Testify (Pol.)
Ding Dong…. (Jim Kunstler)
Theresa May Demands European Leaders Show UK Respect (Ind.)
Legal Action To Revoke Article 50 Referred To European Court Of Justice (G.)
UK PM May Facing Ministerial Resignations Over Brexit Plan (R.)
Russia, Turkey Agree Borders Of Syria Demilitarised Zone (AFP)
Google Suppresses Memo Revealing Plans To Track Search Users In China (IC)
French Court Orders Psychiatric Assessment of Marine Le Pen (Sp.)
Russia’s Secret Plan To Help Julian Assange Escape From UK (G.)
Ecuador Pledged to Not Kick Out Assange – Lawyer (RT)
Ecuador Reportedly Mulled Sending Assange As A Diplomat To Russia (RT)

 

 

The New York Times now helps Trump, or do they think this hurts him?

Rosenstein Proposed Secretly Recording Trump, Invoking 25th Amendment (ZH)

[..] the NYT recounted on Friday an aborted mutiny attempt organized by Rosenstein, who allegedly tried to organize members of Trump’s cabinet to invoke the 25th amendment to oust Trump from office. In an attempt to persuade the clearly reluctant members of Trump’s cabinet, Rosenstein suggested that he or other officials should secretly tape Trump “to expose the chaos” he said was engulfing the West Wing. According to NYT, the sources were either briefed on Rosenstein’s plans, or learned about it from the files of former FBI Deputy Director Andrew McCabe, who was fired after being disgraced by an inspector general investigation. ABC News, which also reported the story, cited sources familiar with McCabe’s files. A grand jury is also weighing whether to press charges against McCabe for allegedly misleading the inspector general.

“Mr. Rosenstein made the remarks about secretly recording Mr. Trump and about the 25th Amendment in meetings and conversations with other Justice Department and F.B.I. officials. Several people described the episodes, insisting on anonymity to discuss internal deliberations. The people were briefed either on the events themselves or on memos written by F.B.I. officials, including Andrew G. McCabe, then the acting bureau director, that documented Mr. Rosenstein’s actions and comments. None of Mr. Rosenstein’s proposals apparently came to fruition. It is not clear how determined he was about seeing them through, though he did tell Mr. McCabe that he might be able to persuade Attorney General Jeff Sessions and John F. Kelly, then the secretary of homeland security and now the White House chief of staff, to mount an effort to invoke the 25th Amendment.”

[..] Mr. Rosenstein disputed this account. “The New York Times’s story is inaccurate and factually incorrect,” he said in a statement. “I will not further comment on a story based on anonymous sources who are obviously biased against the department and are advancing their own personal agenda. But let me be clear about this: Based on my personal dealings with the president, there is no basis to invoke the 25th Amendment.”

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Yeah, strange things are happening…

NY Times, McCabe Give Trump Perfect Cover To Fire Rosenstein, Sessions (Hill)

It has been a year of ironies: President Trump’s personal lawyer, Michael Cohen, once said he would take a bullet for Trump and now seeks to destroy him (and to do so pro bono). Sen. Ted Cruz (R-Texas) once denounced Trump for suggesting Cruz’s father was a presidential assassin but now politically relies on and praises the man who called him “Lying Ted.” The greatest irony of all, however, could be how the newspaper that Trump loves to call “the failing New York Times” succeeded in delivering to him what he has long wanted: a clean shot at firing Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein, and then installing a new AG to oversee special counsel Robert Mueller.

To make this more bizarre, Trump could rely for all this on the man he publicly called on to be fired and possibly prosecuted — former FBI Acting Director Andrew McCabe. The Times dropped a bombshell story late Friday that Rosenstein discussed secretly recording Trump and seeking cabinet support to force him out of office as being incapacitated under the 25h Amendment. Rosenstein denies the story as “inaccurate and factually incorrect,” insisting “there is no basis to invoke the 25th Amendment.” However, McCabe reportedly wrote memos stating that Rosenstein did discuss the possibility of taping and entrapping the president. Trump has previously referred to McCabe’s memos as “fake.”

At least one source has said the comments about secret taping were made in jest. Of course, joking about secretly taping your boss or forcing him from office is not a huge improvement, particularly when you are technically controlling a special counsel’s investigation of the president. Even in jest, it fulfills Trump’s long narrative of a Justice Department set against him from the outset. So how could the Times clear the way for Trump to clean house at Justice and end up with Mueller directly controlled by an attorney general of his choosing? Simple.

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The Kavanaugh story tries hard to be even more absurd than the Rosenstein one.

Grassley Extends Deadline On Kavanaugh Accuser’s Decision To Testify (Pol.)

[..] late Friday, Grassley tweeted: “Five times now we hv granted extension for Dr Ford to decide if she wants to proceed w her desire stated one wk ago that she wants to tell senate her story Dr Ford if u changed ur mind say so so we can move on I want to hear ur testimony. Come to us or we to u.” Minutes later, he added: “Judge Kavanaugh I just granted another extension to Dr Ford to decide if she wants to proceed w the statement she made last week to testify to the senate She shld decide so we can move on I want to hear her. I hope u understand. It’s not my normal approach to b indecisive.”

Grassley followed with a candid lament that he was being outmaneuvered by Democrats: “With all the extensions we give Dr Ford to decide if she still wants to testify to the Senate I feel like I’m playing 2nd trombone in the judiciary orchestra and [Senate Minority Leader Chuck] Schumer is the conductor.” Grassley and other Republicans want Ford to appear on Wednesday, though Ford has requested a Thursday appearance. They accepted some of Ford’s requests after holding a conference call on Friday morning such as allowing one camera in the room, making sure Kavanaugh and Ford aren’t in the same hearing room at the same time and giving Ford breaks during testimony as well as security from the U.S. Capitol Police.

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“Fourth Turning horror show with whipped cream and a cherry on top…”

Ding Dong…. (Jim Kunstler)

This might come as a shock to readers, but the time is not far off when the remaining not-insane cohort of adult Americans gets good and goddamn sick of political sex bombing. Especially given this case of shuck-and-jive. Consider that the same CNN this week produced an entire segment about the shape and size of the President’s generative organ (as reported by an expert in these matters, the porn star and prostitute known as Stormy Daniels). It must be a subject of extraordinary interest to CNN’s Anderson Cooper. On the other flank of the news this week is the much more perilous showdown between the Department of Justice (and the FBI), and Mr. Trump, the cis-hetero-white Golem who happens to be president.

He has ordered these agencies to produce a set of un-redacted documents pertaining to the long-running Russia investigation, set into motion by personnel at these very places. It’s his prerogative under the constitution to do that. In turn, these agencies are being egged on by possibly culpable characters in this melodrama, such as former CIA Director John Brennan and Congressman Adam Schiff (D-Cal), to stonewall the Golem. If I were president — and I may get there yet — I’d send federal marshals into Rod Rosenstein’s office to seize these documents before they are mysteriously “lost.” A tremendous tension hangs over this transaction. Imagine the awful possibility that Mr. Trump may have to declare some kind of martial law to roust out these seditious rascals and clean up their departments. There’s your Fourth Turning horror show with whipped cream and a cherry on top.

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There are plenty other plans. She just doesn’t like them.

Theresa May Demands European Leaders Show UK Respect (Ind.)

Theresa May has demanded EU leaders show Britain respect, branding their public rejection of her Brexit proposals “not acceptable”. In a statement at Downing Street, the prime minister hit out at the way European Council President Donald Tusk discarded her plans without giving a detailed explanation or offering alternatives. Ms May said neither of the options previously offered by the EU were acceptable, stated that talks are now at an “impasse” and underlined her willingness to walk away if needs be – finishing with the words “we stand ready”. But the prime minister also made a new pledge to guarantee the rights of EU citizens living and working in the UK, even in the event of a no-deal Brexit.

Her intervention won approval from cabinet Brexiteers and to an extent from MPs on Conservative benches, steadying a volatile political situation which hours earlier had seen critics predicting the collapse of her strategy. Mr Tusk had surprised British officials by making an unexpectedly strong statement at the end of a summit in Salzburg this week, saying Ms May’s proposals for Brexit “will not work” and following it up with a social media post mocking her negotiating strategy. With pressure mounting, Ms May acknowledged from inside No.10 that Mr Tusk said the UK proposals would undermine the single market, but added: “He didn’t explain how in any detail or make any counter-proposal. So we are at an impasse.”

She said: “Throughout this process, I have treated the EU with nothing but respect. The UK expects the same. A good relationship at the end of this process depends on it. “At this late stage in the negotiations, it is not acceptable to simply reject the other side’s proposals without a detailed explanation and counter proposals. “So we now need to hear from the EU what the real issues are and what their alternative is so that we can discuss them. Until we do, we cannot make progress.”

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Someone in Scotland’s been digging into the law.

Legal Action To Revoke Article 50 Referred To European Court Of Justice (G.)

A legal action to establish whether the UK can unilaterally stop Brexit has been referred to the European court of justice by the court of session in Edinburgh. The case was brought by a cross-party group of six Scottish MPs, MEPs and MSPs, who want the ECJ to offer a definitive ruling on whether the UK can halt the article 50 process without needing the approval of all other 27 EU member states. Rejecting the argument put forward by lawyers for the UK government, that ministers have repeatedly made it clear they have no intention of stopping the Brexit process, even if there were no deal with the EU, Scotland’s most senior judge, Lord Carloway, said: “It seems neither academic nor premature to ask whether it is legally competent to revoke the notification and thus to remain in the EU.”

Carloway, one of three judges to consider the case on appeal after it was initially rejected in June as “academic and hypothetical”, noted that the Commons would be required to vote on whether to ratify any Brexit deal before 29 March 2019, “a date which is looming up”, and that a judgment from the ECJ would “have the effect of clarifying the options open to MPs in the lead-up to what is now an inevitable vote”. Lord Menzies said: “There will have to be a vote, and it appears to me to be legitimate for those who are involved in that vote to know, by means of a judicial ruling, the proper legal meaning of article 50, and in particular whether a member state which has given notification of its intention to withdraw from the EU may revoke that notification of intention unilaterally before the expiry of two years after the notification.”

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Monday could be good. New plans are demanded, but there’s no time for them.

UK PM May Facing Ministerial Resignations Over Brexit Plan (R.)

Some of British Prime Minister Theresa May’s ministers will demand a “Plan B” on her Brexit proposal next week and could quit if she does not change course, the Telegraph newspaper reported late on Friday, citing unnamed sources. Ministers will demand an alternative plan to her “Chequers” proposal at a Cabinet meeting on Monday, the Telegraph said. That plan had already been savaged by European Union leaders in Salzburg earlier in the week, prompting May to defiantly challenge leaders of the bloc to come up with its own plans. Pro-Brexit members of May’s party on Friday had welcomed her defiant tone, but her Chequers proposal has many domestic critics, too.

The Telegraph said there was “speculation” that work and pensions minister Esther McVey might walk out of Monday’s meeting if no new proposal was presented, while international development minister Penny Mordaunt was also tipped as a possible resignation candidate, though the newspaper said friends denied she would resign. Earlier on Friday, Mordaunt said that the EU’s attitude was increasing support within Britain for an exit from the bloc, even if it meant leaving without a deal. .

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Let’s hope Russia got this one right.

Russia, Turkey Agree Borders Of Syria Demilitarised Zone (AFP)

Russia and Turkey have agreed on borders of a demilitarised zone in northern Syria, Russia’s top diplomat said Friday, part of a deal that could check an assault on the last rebel enclave in Idlib. “Just yesterday or the day before, the militaries of Russia and Turkey agreed the concrete frontiers of the demilitarised zone,” Russian Foreign Minister Sergei Lavrov said after talks with his Bosnian counterpart Igor Crnadak. Moscow says the demilitarised zone would help stop attacks from Idlib on Syrian army positions and Russia’s military bases in the region. Russian President Vladimir Putin and Turkish counterpart Recep Tayyip Erdogan agreed the establishment of the 15 to 20 kilometre (9.3-12 miles) buffer zone on Monday after talks that lasted more than four hours.

Security in the zone, which includes parts of Idlib and neighbouring provinces including the city of Aleppo, will be overseen by Turkish contingents and Russian military police. The agreement will prevent military action against the city of Idlib, Russia’s defence minister said. “It’s an intermediate step… but a necessary step,” Lavrov said of the zone. “By mid-October, all (fighters of the Al-Nusra Front) must leave this demilitarised zone, and all heavy military equipment must be pulled out of there,” he said.

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Practising for the west?

Google Suppresses Memo Revealing Plans To Track Search Users In China (IC)

Google bosses have forced employees to delete a confidential memo circulating inside the company that revealed explosive details about a plan to launch a censored search engine in China, The Intercept has learned. The memo, authored by a Google engineer who was asked to work on the project, disclosed that the search system, codenamed Dragonfly, would require users to log in to perform searches, track their location — and share the resulting history with a Chinese partner who would have “unilateral access” to the data. The memo was shared earlier this month among a group of Google employees who have been organizing internal protests over the censored search system, which has been designed to remove content that China’s authoritarian Communist Party regime views as sensitive, such as information about democracy, human rights, and peaceful protest.

According to three sources familiar with the incident, Google leadership discovered the memo and were furious that secret details about the China censorship were being passed between employees who were not supposed to have any knowledge about it. Subsequently, Google human resources personnel emailed employees who were believed to have accessed or saved copies of the memo and ordered them to immediately delete it from their computers. Emails demanding deletion of the memo contained “pixel trackers” that notified human resource managers when their messages had been read, recipients determined.

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For posting ISIS execution pictures.

French Court Orders Psychiatric Assessment of Marine Le Pen (Sp.)

The request is connected with a series of images she posted on Twitter showing Daesh* executions. France’s National Rally party leader Marine Le Pen took to Twitter to express her anger with the court order. “I thought I had been through it all: well, no! For denouncing the horrors of Daesh (Isis) with tweets, the “justice system” has referred me for a psychiatric assessment. How far will they go?!” she said. “This regime is really starting to be frightening,” Le Pen added. Le Pen noted that, contrary to French media reports, the procedure was not customary. According to a decision made on September 11, which Le Pen posted on Twitter, the purpose of the psychiatric assessment was to answer the question: “Can she [Le Pen] understand the statements and answer the questions.”

In the list of questions given to the experts, there were eight points, among which were: “whether she acted under the influence of forces or circumstances of force majeure” as well as “is she in a dangerous state from the standpoint of psychiatry or forensic science, and what is the forecast,” among others. The National Assembly (lower house of parliament) of France in November 2017, at the request of the Nanteré Prosecutor’s Office, deprived Le Pen of parliamentary immunity in connection with the publication on Twitter. If the French court finds her guilty, the leader of the party may face up to three years in prison and a fine of 75,000 euros.

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More Guardian smear, sources that are known have long been discredited, Mueller’s allegations have been keelhauled, anonymous sources are suspect.

Russia’s Secret Plan To Help Julian Assange Escape From UK (G.)

Russian diplomats held secret talks in London last year with people close to Julian Assange to assess whether they could help him flee the UK, the Guardian has learned. A tentative plan was devised that would have seen the WikiLeaks founder smuggled out of Ecuador’s London embassy in a diplomatic vehicle and transported to another country. One ultimate destination, multiple sources have said, was Russia, where Assange would not be at risk of extradition to the US. The plan was abandoned after it was deemed too risky. The operation to extract Assange was provisionally scheduled for Christmas Eve in 2017, one source claimed, and was linked to an unsuccessful attempt by Ecuador to give Assange formal diplomatic status.

The involvement of Russian officials in hatching what was described as a “basic” plan raises new questions about Assange’s ties to the Kremlin. The WikiLeaks editor is a key figure in the ongoing US criminal investigation into Russia’s attempts to sway the outcome of the 2016 presidential election. Robert Mueller, the special counsel conducting the investigation, filed criminal charges in July against a dozen Russian GRU military intelligence officers who allegedly hacked Democratic party servers during the presidential campaign. The indictment claims the hackers sent emails that embarrassed Hillary Clinton to WikiLeaks. The circumstances of the handover are still under investigation. According to Mueller, WikiLeaks published “over 50,000 documents” stolen by Russian spies. The first tranche arrived on 14 July 2016 as an encrypted attachment. Assange has denied receiving the stolen emails from Russia.

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Very promising.

Ecuador Pledged to Not Kick Out Assange – Lawyer (RT)

Despite widespread speculation a few months ago that WikiLeaks founder Julian Assange may be kicked out of the Ecuadorian embassy by the country’s new leadership, his asylum seems to be safe for now, his lawyer told RT. In July, there were numerous reports that Ecuador’s president, Lenin Moreno, may revoke the political asylum given to Assange by his predecessor, Rafael Correa, as part of an effort to establish closer ties with the US. The threat never materialized, but his long-time lawyer said “anything could happen at any time.” “Ecuador has made it clear in the past few months – after this wide-spread speculation that he would be forced to leave – that they will respect the asylum,” she said.

Assange remains cut off from all communications and kept in what is effectively solitary confinement with no access to outdoor areas. His health is deteriorating, and the UK authorities have made sure that he won’t get treatment without leaving the embassy, she said. Assange was granted asylum in August 2012, skipping bail in the UK justice system. At that time, he was fighting extradition to Sweden, where he faced prosecution over a now-closed case over alleged sex offenses. He said he had to seek Ecuador’s protection because if forced to go to Sweden, he could be extradited to the US and face serious charges over his actions as WikiLeaks founder.

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Would have been a good solution.

Ecuador Reportedly Mulled Sending Assange As A Diplomat To Russia (RT)

London refused to grant WikiLeaks founder Julian Assange diplomatic immunity so he could escape the confinement of the Ecuadorian embassy in the UK and relocate to Russia, Reuters reports, citing government communications. The persona of Julian Assange has become a thorn in Ecuador’s president Lenin Moreno’s side and, ever since assuming office in May of last year, Moreno has made every effort to make sure the Australian’s stay at Ecuador’s embassy in London comes to an end as soon as possible. To shift the responsibility for Assange’s protection against US persecution, Ecuador allegedly mulled offering the WikiLeaks founder a diplomatic post in Russia, which the country hoped would enable him –protected by diplomatic immunity– to finally leave the embassy after six years of arbitrary detention.

London, however, refused to honor Moreno’s move to authorize “special designation” for 47-year-old to carry out diplomatic functions in Moscow, and declined to grant the whistleblower a free passage out of the country, Reuters reports, citing a letter by Ecuador’s foreign ministry to opposition legislator Paola Vintimilla. According to the letter, Quito abandoned its idea to relocate the whistleblower to Moscow after the UK Foreign Office refused to recognize Assange’s special status, or any privileges and immunities awarded under the Vienna Convention on Diplomatic Relations. The “special designation” status awarded by the Ecuadorian president would allow Assange to hold diplomatic posts abroad even if the whistleblower is not career diplomat. However, under English law, the 47 year-old can only enjoy diplomatic privileges, such as immunity, only if his credentials are accepted by the Foreign Office.

[..] Citing at least four, traditionally anonymous, sources, the Guardian wrote that Moscow was plotting to smuggle Assange out of London on Christmas eve last year, but dropped the plan because it was “deemed too risky.” The paper, claimed that Ecuador’s former London consul, Fidel Narvaez, was in talks with Russian diplomats and in constant contact with a ‘Russian businessman’ who coordinated the proposed operation with the Kremlin. It took the newspaper a mere five paragraphs of its 1,000-word report to bring up “questions about Assange’s ties to the Kremlin” in the context of the notorious Mueller probe and alleged ‘Russian hacking’ of the US elections.

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Sep 212018
 
 September 21, 2018  Posted by at 1:35 pm Finance Tagged with: , , , , , , , , , , , , ,  


M. C. Escher The Tower of Babel 1928

 

Two thirds of Americans get at least some of their news on social media. Google and Facebook receive well over 70% of US digital advertising revenues. The average daily time spent on social media is 2 hours. Just a few factoids that have at least one thing in common: nothing like them was around 10 years ago, let alone 20. And they depict a change, or set of changes, in our world that will take a long time yet to understand and absorb. Some things just move too fast for us to keep track of, let alone process.

Those of us who were alive before the meteoric rise of the hardware and software of ‘social’ media may be able to relate a little more and better than those who were not, but even that is not a given. There are plenty people over 20, over 30, that make one think: what did you do before you had that magic machine? When you walk down the street talking to some friend, or looking at what your friends wrote on Facebook, do you ever think about what you did in such situations before the machine came into your life?

 


From 10% to 75% in 10 years

 

We’re not going to know what the hardware and software of ‘social’ media will have done to our lives, individually and socially, for a very long time. But in the meantime, their influence will continue to shape our lives. They change our societies, the way we interact with each other, in very profound ways; we just don’t know how profound, or how, period. There can be little question that they change us as individuals too; they change how we communicate, and in such a way that there is no way they don’t also change our very brain structures in the process.

Someone who walks down a street talking to someone else 10, 100, 1000 miles away, or sees messages from such a person come in in virtual real time, experiences things that were not available ever in human history. Our brains must adapt to these changes, or we will be left behind. And while for the over-20, over-30 crowd this takes actual adaptation, for those younger than that it comes quasi pre-cooked: they’ve never known anything else. Still, their brains were formed in completely different times too. Think hunter-gatherers. And that’s just the human part of the brain.

There are too many aspects to this development to cover here. One day someone will write a book, or rather, many someones will write many books, and they will all be different. Some will focus on people’s lives being saved because their smartphones allow them to either receive or send out distress signals. Others will tell stories of teenagers committing suicide after being heckled on ‘social’ media. With yin comes yang. Millions feel better with new-found ‘friends’, and millions suffer from abuse even if they don’t kill themselves.

 

With new media, especially when it goes from 1 to 100 in no time flat, it should be no surprise that the news it delivers changes too. We went from a few dozen TV- and radio stations and newspapers to a few hundred million potential opinions in the US alone. The media are no longer a one-way street. The first effect that has had is that the chasm between news and opinion has narrowed spectacularly. If their readers post their views of what they read and see, journalists feel they have the right to vent their opinions too.

And then these opinions increasingly replace the news itself. The medium is again the message, in a way, a novel kind of way. A hundred million people write things without being restricted by due diligence or other journalistic standards, and we see journalists do that too. They will come up with lies, half-truths, innuendo, false accusations, and moreover will not retract or correct them, except when really hard-pressed. After all, who has the time when you post a hundred+ tweets a day and need to update your Facebook pages too?

Obviously, Donald Trump is an excellent example of the changing media environment. His use of Twitter was a major factor in his election victory. And then his detractors took to Twitter to launch a huge campaign accusing him of collusion with Russia to achieve that victory. They did this moving in lockstep with Bob Mueller’s investigation of that collusion accusation. But almost two years after the election, neither Mueller not the media have provided any evidence of collusion.

That, ironically, is the only thing that is actually true about the entire narrative at this point. Sure, Mueller may still have something left in his back pocket, but if he had solid proof he would have been obliged to present it. Collusion with a foreign government is too serious not to reveal evidence of. Therefore, it’s safe to conclude that in September 2018, Mueller has no such evidence. But what about the thousands of printed articles and the millions of Tweets and Facebook posts claiming collusion that were presented as true?

Funny you asked. What they prove is not collusion, but the changing media landscape. The anti-Trump echo-chamber that I’ve written about many times has been going strong for two years and shows no signs of abating. There are still lots of people posting a hundred (re-)tweets etc. daily who are being read by many others, all of them confirming their biases in a never fulfilled feeding frenzy.

This is not about Trump. And I’m not a Trump supporter. This is instead about the media, and the humongous difference interactivity has made. And about the fact that it hasn’t just added a hundred million voices, it has also altered the way traditional media report the news, in an effort to keep up with those hundred million.

 

The thing here that is about Trump, is that he’s everybody’s favorite meal ticket. He confirms everyone’s opinion, whether for or against him, by the way he uses media. And most importantly, they all make a lot of money off of him. The New York Times and WaPo and MSNBC would be in deep financial trouble without Trump. Like they were before he came along. Polarization of opinions saved them. Well, not the WaPo, Jeff Bezos can afford to run 1000 papers like that and lose money hand over fist. But for the NYT and many others a Trump impeachment would be disastrous. Funny, right?

Another thing that is obvious is that one thing still sells above all others: sex. The smear campaign against Julian Assange has been successful in one way only, and it’s been a smash hit: the rape allegations. Completely false, entirely made up, dragged out as long as possible, and turning millions, especially women, against him.

The accusations against Supreme Court candidate Brett Kavanaugh haven’t been around long enough to be discredited. Maybe they will be, maybe they won’t. But read through newspaper articles, watch TV shows, follow Twitter, and you see countless voices already convinced ‘he did it’. And that ‘it’ is often labeled ‘rape’, though that’s not the accusation.

But it’s part of the Anti-Trump train, and the echo-chamber has gone into overdrive once again. Even if everyone understands that a 36-year old accusation must be handled with care. The accusing woman’s lawyer says the FBI must investigate, and everyone says: FBI! FBI!. Conveniently forgetting that the FBI has been far from impartial with regards to Trump, and the White House is not exactly waiting for another FBI role.

What’s wrong with waiting till you know the facts? Why judge a situation you know nothing about other than a woman accuses a man of assault 36 years ago, and doesn’t remember time, location etc.?

 

And that’s the thing all along, isn’t it? That people, both readers and journalists, all 200 million Americans of them, think they have acquired the right to judge any person, any situation they read a few lines about, just because they have purchased a smartphone. A faulty notion fed on a daily basis by the fact there are millions who think just like them.

We may want to rethink the terms ‘social’ media and ‘smart’ phone. They sound good, but they don’t cover the true nature of either. It’s hard to say where all this is going, but the sharply increasing polarization of society is certainly not a good sign. People feeling they have the right to accuse others without knowing facts, people building a Russiagate narrative without evidence, these are not things a society should welcome, whether they’re profitable or not.

Meanwhile, there are two people (there are many more, of course) who were banned from the platforms so many others use to draw baseless conclusions and spout empty accusations. And we miss them both, or we should: Alex Jones and Julian Assange. Have they really used ‘social’ media in worse ways than those 200 million Americans? Or were they banned because millions of Americans were following and reading their non-mainstream views?

We better get a grip on this, and on ourselves, or we won’t get another chance. What we have seen so far is that it’s not that hard to shape people’s opinions in a world with information overload. And that process is about to get a whole lot more intense. Until all you’re left with is the illusion that your opinion is actually your own.

 

 

Sep 072018
 
 September 7, 2018  Posted by at 9:18 am Finance Tagged with: , , , , , , , , , , ,  


René Magritte The false mirror 1928

 

I Know Who the “Senior Official” Is Who Wrote the NY Times Op-Ed (PCR)
Pompeo Denies Being Author Of ‘Sad’ NYT Op-Ed On Trump (AFP)
Mueller Hardens Stance On Trump Interview In Russia Probe, Giuliani Says (R.)
‘Lots Of Evidence’ Syria Preparing Chemical Weapons In Idlib- New US Envoy (R.)
Operation Yellowhammer: Secret Government Paper On No-Deal Brexit (Ind.)
Brexit Negotiators Risk Sleepwalking Into Crisis – Former UK Envoy To EU (G.)
The Fed’s QE Unwind Hits $250 Billion (WS)
Twitter Permanently Bans Alex Jones, Website Infowars (R.)
Google and Apple’s Systems to Track you in Person (CP)
Moon Says Is Seeking To Establish ‘Irreversible’ Peace On Korean Peninsula (YH)
Paris Official Seeks To Outlaw Airbnb Rentals In City Centre (AFP)
Most Of British Countryside Now Devoid Of Hedgehogs (G.)

 

 

Paul Craig Roberts: “The New York Times wrote it.”

I Know Who the “Senior Official” Is Who Wrote the NY Times Op-Ed (PCR)

I know who wrote the anonymous “senior Trump official” op-ed in the New York Times. The New York Times wrote it. The op-ed is an obvious forgery. As a former senior official in a presidential administration, I can state with certainty that no senior official would express disagreement anonymously. Anonymous dissent has no credibility. Moreover, the dishonor of it undermines the character of the writer. A real dissenter would use his reputation and the status of his high position to lend weight to his dissent. The New York Times’ claim to have vetted the writer also lacks credibility, as the New York Times has consistently printed extreme accusations against Trump and against Vladimir Putin without supplying a bit of evidence.

The New York Times has consistently misrepresented unsubstantiated allegations as proven fact. There is no reason whatsoever to believe the New York Times about anything. Consider also whether a member of a conspiracy working “diligently” inside the administration with “many of the senior officials” to “preserve our democratic institutions while thwarting” Trump’s “worst inclinations” would thwart his and his fellow co-conspirators’ plot by revealing it! This forgery is an attempt to break up the Trump administration by creating suspicion throughout the senior level. If Trump falls for the New York Times’ deception, a house cleaning is likely to take place wherever suspicion falls. A government full of mutual suspicion cannot function.

The fake op-ed serves to validate from within the Trump administration the false reporting by the New York Times that serves the interests of the military/security complex to hold on to enemies with whom Trump prefers to make peace. For example, the alleged “senior official” misrepresents, as does the New York Times, President Trump’s efforts to reduce dangerous tensions with North Korea and Russia as President Trump’s “preference for autocrats and dictators, such as President Vladimir Putin of Russia and North Korea’s leader, Kim Jong-un” over America’s “allied, like-minded nations.” This is the same non-sequitur that the New York Times has expressed endlessly. Why is resolving dangerous tensions a “preference for dictators” and not a preference for peace? The New York Times has never explained, and neither does the “senior official.”

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As have lots of others. If PCR is right, makes sense.

Pompeo Denies Being Author Of ‘Sad’ NYT Op-Ed On Trump (AFP)

US Secretary of State Mike Pompeo denied Thursday being the author of a damning, anonymous op-ed in the New York Times about President Donald Trump, calling it “sad”. “It shouldn’t surprise anyone that the New York Times, a liberal newspaper that has attacked this administration relentlessly, chose to print such a piece,” Pompeo said in New Delhi. “If it’s accurate… they should not… have chosen to take a disgruntled, deceptive bad actor’s word for anything and put it in their newspaper. It’s sad more than anything else,” he told reporters.

He added: “I come from a place where if you’re not in a position to execute the commander’s intent, you have a singular option, that is to leave. And this person instead, according to the New York Times, chose not only to stay but to undermine what President Trump and this administration are trying to do. “And I have to tell you, I just, I find the media’s efforts in this regard to undermine this administration incredibly disturbing. The editorial, by an anonymous senior US official according to the New York Times, said that Trump’s own staff see him as a danger to the nation. Trump has questioned whether the “gutless” piece, entitled “I am part of the resistance inside the Trump administration”, might be treasonous. “It’s not mine,” Pompeo added.

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“We’ve said no, and let’s see how they deal with it.”

Mueller Hardens Stance On Trump Interview In Russia Probe, Giuliani Says (R.)

Special Counsel Robert Mueller wants President Donald Trump to commit to a follow-up interview to written answers to questions in his probe of any coordination between Trump campaign members and Russia in the 2016 U.S. election, Rudy Giuliani, who is representing the president, said on Thursday. Giuliani, who said talks between the two sides were continuing, saw Mueller’s stance as a hardening in the position prosecutors are taking after offering to allow Trump to answer questions in writing. “I thought we were close to having an agreement until they came back with, ‘You have to agree now that you’ll allow a follow-up,’ and I don’t see how we can do it,” Giuliani told Reuters.

Lawyers for Trump have been negotiating over a potential interview with Mueller’s team since last year in the U.S. investigation of Russian meddling in the presidential election, which Moscow denies. Trump has denied any campaign collusion, calling the Mueller probe a “witch hunt.” In a letter to Trump’s lawyers last week, Mueller expressed a willingness to accept written responses on questions about collusion, but did not rule out a possible interview as a follow-up, a person familiar with the matter told Reuters on Tuesday. After receiving the written responses, Mueller’s investigators would decide on a next step, which could include an interview with Trump, the person said. But Giuliani said on Thursday that Mueller’s team had stiffened its position in the latest talks. “They want a commitment” to a follow-up interview, Giuliani said. “We’ve said no, and let’s see how they deal with it.”

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In crease the pressure on Trump with anon op-eds and Mueller, and see if he bombs Assad. Transparent.

‘Lots Of Evidence’ Syria Preparing Chemical Weapons In Idlib- New US Envoy (R.)

There is “lots of evidence” chemical weapons are being prepared by Syrian government forces in Idlib, north-west Syria, the new US representative for Syria has said, warning any attack on the last big rebel enclave would be a “reckless escalation”. “I am very sure that we have very, very good grounds to be making these warnings,” said Jim Jeffrey, who was named on 17 August as secretary of state Mike Pompeo’s special adviser on Syria overseeing talks on a political transition. “Any offensive is to us objectionable as a reckless escalation,” Jeffrey said. “There is lots of evidence that chemical weapons are being prepared.”

Washington has issued a strong warning to Syria’s government against using chemical weapons in the widely expected operation. Jeffrey said any offensive by Russian and Syrian forces, and the use of chemical weapons, would force huge refugee flows into south-eastern Turkey or areas in Syria under Turkish control. The Syrian president, Bashar al-Assad, has massed his army and allied forces on the frontlines in the north-west and Russian planes have joined his bombardment of rebels there – the prelude to a possible assault. The fate of the insurgent stronghold in and around Idlib province now seems to rest on a meeting to be held in Tehran on Friday between the leaders of Assad’s supporters Russia and Iran, and the rebels’ ally Turkey.

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“..its song is said to have a rhythm like “a little bit of bread and no cheese”

Operation Yellowhammer: Secret Government Paper On No-Deal Brexit (Ind.)

A secret Treasury document has raised questions about “rail access to the EU” after a no-deal Brexit. The document – snapped as it was carried into a Whitehall meeting – also reveals that Philip Hammond’s department has codenamed its contingency planning “Operation Yellowhammer”. It warns that government departments will have to make cuts to prepare for crashing out of the EU, saying: “Their first call should be internal reprioritisation.” And it acknowledges the need to “maintain confidence in the event of contingency plans being triggered – particularly important for financial services”.

Operation Yellowhammer is being overseen by the Civil Contingencies Secretariat, which is usually responsible for coping with emergencies such as floods and disease outbreaks. The document was photographed just hours after the health secretary admitted that taxpayers would have to foot the bill for stockpiling NHS medicines in a no-deal Brexit. A Treasury spokesman refused to be drawn on the paper, saying: “We don’t comment on leaked documents.” The yellowhammer is a bird with a bright yellow head, a brown back streaked with black and chestnut rump, often seen perched on top of a hedge or bush, singing. Intriguingly for critics of a no-deal Brexit, its song is said to have a rhythm like “a little bit of bread and no cheese”.

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“Rogers says the prime minister’s compromise plan “contains many wholly unsaleable elements and will not [and] cannot be agreed by the 27..”

Brexit Negotiators Risk Sleepwalking Into Crisis – Former UK Envoy To EU (G.)

Brexit negotiators on both sides of the Channel risk “sleepwalking into a major crisis” that could poison relations for a generation, the UK’s former ambassador to the European Union Sir Ivan Rogers, has warned. In a speech to the British Irish Chambers of Commerce in Dublin, he urged EU leaders to move beyond a technocratic approach to Brexit and give serious thought to “the British question” or risk “endless toxic running battles”. “There is now, in my view, a higher risk than the markets are currently pricing of a disorderly breakdown in Brexit negotiations, and of our sleepwalking into a major crisis,” he said. “Not because either negotiating team actively seeks it, but precisely because each side misreads each other’s real incentives and political constraints and cannot find any sort of landing zone for a deal, however provisional.”

He said it was “tempting” and “an understandable accusation” for European capitals to think that “the British have brought all this on themselves without much apparent thought or honesty”. But he urged leaders to take a longer view, or risk a brittle settlement that would not last. Rogers resigned as the UK’s ambassador to the EU last January after being attacked as “the gloomy mandarin” by Tory Eurosceptics, who dismissed his warnings that leaving the EU would be be complicated process that would dominate UK political life for a decade.

In a parting email to staff he urged British officials to challenge ill-founded arguments and “muddled thinking”, while another former top civil servant lamented his departure as a “wilful and total destruction of EU expertise”. In his speech on Thursday night Rogers criticised the “delusional” thinking of British Eurosceptics and said they knew that a genuine no-deal Brexit “would bring several key sectors of the economy to a halt”. He said that advocates of a no-deal Brexit expected to trigger a host of mini deals at the 11th hour.

[..] Much of his speech was a plea to EU27 member states to take a strategic approach to Brexit, recognising that they cannot have “just a bog-standard third-country relationship like any other” with the UK. But Rogers was not attempting to sell Theresa May’s Chequers plan, an array of proposals that includes an unprecedented customs deal and “common rule book” for goods that the EU has rejected. Rogers says the prime minister’s compromise plan “contains many wholly unsaleable elements and will not [and] cannot be agreed by the 27”.

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Just a start, but getting serious.

The Fed’s QE Unwind Hits $250 Billion (WS)

In August, the Federal Reserve was supposed to shed up to $24 billion in Treasury securities and up to $16 billion in Mortgage Backed Securities (MBS), for a total of $40 billion, according to its QE-unwind plan – or “balance sheet normalization.” The QE unwind, which started in October 2017, is still in ramp-up mode, where the amounts increase each quarter (somewhat symmetrical to the QE declines during the “Taper”). The acceleration to the current pace occurred in July. So how did it go in August? The Fed released its weekly balance sheet Thursday afternoon. Over the period from August 2 through September 5, the balance of Treasury securities declined by $23.7 billion to $2,313 billion, the lowest since March 26, 2014. Since the beginning of the QE-Unwind, the Fed has shed $152 billion in Treasuries:

The step-pattern of the QE unwind in the chart above is a consequence of how the Fed sheds Treasury securities: It doesn’t sell them outright but allows them to “roll off” when they mature; and they only mature mid-month or at the end of the month. On August 15, $23 billion in Treasuries matured. On August 31, $21 billion matured. In total, $44 billion matured during the month. The Fed replaced about $20 billion of them with new Treasury securities directly via its arrangement with the Treasury Department that cuts out Wall Street – the “primary dealers” with which the Fed normally does business. Those $20 billion in securities were “rolled over.” But it did not replace about $24 billion of maturing Treasuries. They “rolled off” and became part of the QE unwind.

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They have to reveal their grounds.

Twitter Permanently Bans Alex Jones, Website Infowars (R.)

Twitter on Thursday permanently banned U.S. conspiracy theorist Alex Jones and his website Infowars from its platform and Periscope, saying in a tweet that the accounts had violated its behavior policies. “As we continue to increase transparency around our rules and enforcement actions, we wanted to be open about this action, given the broad interest in this case,” the company tweeted. “We do not typically comment on enforcement actions we take against individual accounts for their privacy.” In a video posted on the Infowars website on Thursday Jones said, “I was taken down not because we lied but because we tell the truth and because we were popular.”

The ban came weeks after Apple, Alphabet’s YouTube, and Facebook took down podcasts and channels from Jones, citing community standards. Jones, whose conspiracy theories include that the 2012 Sandy Hook school massacre was a hoax, hosts the syndicated radio program “The Alex Jones Show.” Last month, Jones lost a bid to dismiss a defamation lawsuit brought against him by the parents of a boy who was killed in the Sandy Hook shooting. On Wednesday, Jones attended a Senate Intelligence Committee hearing on ways to counteract foreign efforts to influence U.S. elections and political discourse. Facebook Chief Operating Officer Sheryl Sandberg and Twitter Chief Executive Jack Dorsey testified at the hearing.

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Bluetooth ‘beacons’ everywhere that track you. Lovely.

Google and Apple’s Systems to Track you in Person (CP)

Google is in the news (again) for creepy surveillance practices. Google, AP reported, is tracking your physical whereabouts even after you tell them to shut Location History off. Now Bloomberg reports they bought data about Mastercard transactions to link online ads with in-store purchases. These make for interesting stories, but the real story, not being discussed, is the online-physical advertising systems engineered by Google and Apple.

Over the last few years, there’s been a quiet revolution in retail marketing empowering advertisers to track consumers in physical space. Retailers have realized that, contrary to popular misconceptions, most retail purchases are still made in brick-and-mortar stores– not the online world of Amazon and Walmart. The capacity to track each of us in the physical world offers an untapped market for high-tech advertising. Google previously called this the Physical Web, a new Internet of Things frontier that melds the online and offline worlds into one.

To facilitate online-offline tracking, Google and Apple developed protocols for communications with mobile devices like smartphones. The idea is to make the physical world, like a poster on a building, something you can “click on” (i.e. interact with) without installing a special app. The dominant weapon of choice is the bluetooth beacon – silly putty-sized units that broadcast bluetooth signals to track your precise location and send messages to your phone. Bluetooth beacons are now scattered about stores, airports, sporting arenas, malls, and other locales. The technology is several years in the making.

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Let him.

Moon Says Is Seeking To Establish ‘Irreversible’ Peace On Korean Peninsula (YH)

South Korea is seeking to formally end its hostile relations with North Korea before the year’s end to establish permanent peace that would be irreversible, South Korean President Moon Jae-in said in an interview published Friday. “The most basic goal of our policy is that there must never be another war on the Korean Peninsula,” the president said in a written interview with Indonesian newspaper Kompas. The rare interview came ahead of Indonesian President Joko Widodo’s three-day trip to Seoul. Moon and Widodo will meet Monday, one day after the Indonesian leader arrives on a state visit. Moon noted he and North Korean leader Kim Jong-un have already agreed to denuclearize the Korean Peninsula and establish permanent peace.

“The issue is sincerely implementing the agreement reached by the leaders, and the plan is to make enough progress by the year’s end so the process cannot be reversed,” the South Korean president said, according to a script of his written interview released by his office Cheong Wa Dae. Moon’s remarks came as he is set to hold his third bilateral summit with the North Korean leader in Pyongyang from Sept. 18-20. Moon and Kim earlier met in the border village of Panmunjom on April 27 and May 26. He expressed hope for a formal end to the Korean War before the year’s end. “As a practical way of building trust, it would be great if a declaration of the war that would mark the end of hostile relations on the Korean Peninsula can be made this year,” Moon said.

Read more …

“We’ll be living in an open-air museum.”

Paris Official Seeks To Outlaw Airbnb Rentals In City Centre (AFP)

The Paris city council member in charge of housing said Thursday that he would propose outlawing home rentals via Airbnb and other websites in the city centre, accusing the service of forcing residents out of the French capital. Ian Brossat told AFP that he would also seek to prohibit the purchase of secondary residences in Paris, saying such measures were necessary to keep the city from becoming an “open-air museum”. “One residence out of every four no longer houses Parisians,” said Brossat, who is expected to head the Communist party list for European Parliament elections next year. With some 60,000 apartments on offer in the city, Paris is the biggest market for Airbnb, which like other home-sharing platforms has come under increasing pressure from cities which claim it drives up rents for locals.

“Do we want Paris to be a city which the middle classes can afford, or do we want it to be a playground for Saudi or American billionaires?” he said. Brossat has had Airbnb and its rivals in his sights for years, and recently published a book assailing the US giant titled “Airbnb, or the Uberised City”. He wants to forbid any short-term tourist rentals of entire apartments in the First, Second, Third and Fourth Arrondissements of Paris, home to some of the world’s most popular sites including the Cathedral of Notre-Dame and the Louvre museum. “If we don’t do anything, there won’t be any more locals: Like on the Ile Saint-Louis, we’ll end up with a drop in the number of residents and food shops turned into clothing or souvenir stores,” he said, referring to the Seine island in the shadow of the Notre-Dame cathedral. “We’ll be living in an open-air museum.”

Read more …

In the end this means a countryside devoid of countryside.

Most Of British Countryside Now Devoid Of Hedgehogs (G.)

A “perfect storm” of intensive farming and rising badger populations has left most of the countryside in England and Wales devoid of hedgehogs, according to the first systematic national survey. The research used footprints left by hedgehogs in special tunnels to reveal that they were living at just 20% of the 261 sites surveyed. Hedgehogs, which topped a vote in 2013 to nominate a national species for Britain, were significantly less common where badgers were more numerous. Badgers eat hedgehogs and also compete for the beetles and worms the prickly animals consume. However, hedgehogs and badgers lived alongside each other in half the hedgehog sites, while a quarter of all the sites had neither animal, showing the destruction of habitat such as hedgerows and coppices was also a major factor.

“There are lots of areas in the countryside that are not suitable for hedgehogs or badgers,” said Ben Williams, at the University of Reading, who led the new work. “There is something fundamentally wrong in the rural landscape for those species and probably lots of other species as well,” such as birds and shrews. Previous work based on visual sightings and roadkills indicated that the number of hedgehogs living in the British countryside has plummeted by more than half since 2000. Historical hedgehog numbers are hard to estimate, but scientists think populations have fallen by at least 80% since the 1950s. The new survey, published in the journal Scientific Reports, is much more detailed and reliable. It concludes: “The combined effects of increasing badger abundance and intensive agriculture may have provided a perfect storm for hedgehogs in rural Britain, leading to worryingly low levels of occupancy over large [areas].”

Read more …

Jul 172018
 
 July 17, 2018  Posted by at 12:50 pm Finance Tagged with: , , , , , , , , , ,  


Ivan Aivazovsky Among the waves 1898

 

Yeah, just keep ’em coming, right, so that when the last one falls flat on its face people will have already forgotten about it and instead focus on the new one. It’s been the modus operandi of the US MSM ever since Donald Trump emerged as an actual presidential candidate, and they haven’t let go.

They realize by now that it divides the nation, it costs them a large chunk of their potential readers and viewers, and creates chaos all around, but the bottom line is it makes them money. Because those people who fall into the echo chamber trap, tumble into it fast and furious, and will gladly pay to read yet another installment of how bad the man really is.

But it is getting out of hand, guys and gals, it is becoming a real and present danger to the -formerly- United States. The anti-Russia propaganda machine far predates Trump, but manufacturing an ever closer link between the two has proven to be a masterstroke of media genius.

That Vladimir Putin is an existential threat to the US and indeed the entire western world is a narrative taken straight out of Edward Bernays’ playbook. And it works like a charm. The problem is, it is also the biggest threat to peace anywhere on the globe that we have ever seen since WWII.

Putin is a patriot who came to the fore in mostly unexplained ways, named by American puppet Boris Yeltsin as his successor, only to save his country from US-induced plundering and restore Russia as a functioning country. Far from perfect, but functioning. Don’t forget that Russian life-expectancy fell by many years in the post-Gorbachev era. And then look now.

Yes, Putin uses some hard-handed tactics from time to time. He has no choice: the US threat to Russia is an ongoing one. There’s still a huge economic threat, of which US sanctions are but a minor part, there’s an intelligence threat, there’s NATO encroaching upon Russia’s borders.

Thus far, Putin has been able to counter them all. And his popularity among Russia’s population is far higher than that of any western politician. His people understand and recognize what he’s done and why he’s done it. He refuses for his country to be overrun and sold off to the highest bidders.

 

Just a few of the points of contention: Crimea – The US tried to take away Russia’s only warm water port. Putin countered with what through non-western eyes was tactical masterpiece; no violence, no shots fired, an election that saw an overwhelming majority of Crimeans voted to (re-)join Russia.

Connected to Crimea is Ukraine. Putin had -and has- to protect Russian-speaking people in the region. Who were going to be under threat from the very dubious, neo-nazi linked government installed by the US after the coup. All Putin has been able to achieve so far is a very brittle stand still. But ‘his’ people in Eastern Ukraine have strong links to the Russian area just across the border. He’s not going to sell them out.

Connected to Ukraine is MH17. The Netherlands commemorates the victims of the shooting down again today. Several years of investigating have come up with no conclusive proof, even if they say it has. The problem is that the investigation was -is- led by The Netherlands itself. You don’t let the biggest victim conduct an investigation.

What’s worse: the Ukraine was actively involved in the investigation, even when it was a potential culprit. Try to write that scenario into the plot of one of your favorite TV crime series. Won’t fly.

 

Then the novichok ‘events’ in the UK. Again, no evidence, but tons of allegations. And if Russia says it’s not guilty, everyone says and writes: of course they would say that. They get accused anyway. Still, no evidence is no evidence. the time that intelligence agencies were believed on their word is over. And they did it to themselves.

In the regard, it’s useful to see that Robert Mueller was one of the people who ‘swore’ that the Weapons of Mass Destruction ‘evidence’ against Saddam Hussein was real. We now know it was complete and utter fiction. Intelligence has overplayed its hand, and they won’t get it back for a long time.

People now realize they cannot be trusted. Well, not those who read and view the MSM, but then that’s sort of the entire point, isn’t it? That’s where the dividing line is being drawn. The CIA, FBI et al present a view of the world in concoction with the media that they think a sufficient number of people will swallow, and that’s really all they care for.

And boy, it is successful. The vitriol spewed over the Helsinki summit is something to behold. #TreasonSummit was a trending hashtag. For a meeting that was long overdue and aimed at calming down tensions. The by now very poorly named ‘social’ media play an ever bigger role in these things.

People can say whatever they want on them, without feeling they’ll ever actually be tested on their claims. One after the other, and each one trying to outdo the last. It all leads up to one particular worldview at the exclusion of all others. And again, that is very dangerous.

 

Mueller’s indictment of 12 Russians, which just happened to coincide with the first meeting of American and Russian presidents in an exceptionally long time, has been shot full of holes by many commentators, see for instance Adam Carter and Aaron Mate, but those views won’t make it to CNN or the NYT.

But despite the fact that the indictment is hollow and riddled with holes, it’s been a large part of why people call Trump a traitor for meeting with Putin. It ties together their opinions, carefully built along Bernays principles over the past two years. It’s a Matrix, it’s a trap. But then they throw in another story, of a 29 year-old Russian(!) girl arrested for allegedly setting up links between Russia and the NRA when she was 24 or so, and that replaces the Mueller indictment in most attention spans. And so the carrousel goes on. The torture never stops.

See, the idea is that you get yourself informed and then form your own opinion. Not that you let others pre-cook and pre-chew your opinions for you. Still, once you’re inside the deafening echo chamber, that’s what inevitably happens. Because there’s so much one-sided innuendo in there, your head aches and you just give up all resistance. Just to have a quiet moment.

And so very many Americans end up believing that indeed their president is guilty of treason. Because so many pundits claim that he is. But how many of them understand what treason really is, how serious an allegation it is? Is doesn’t really matter anymore, does it? Because all those others say he is, and they can’t all be wrong. And the echo chamber gives you a headache.

This is where I should say that somebody better do something about this, but it’s hard to see what. The divide has grown into a chasm. And that both sides are equally to blame for that doesn’t excuse either side’s wilful blindness. But yes, I hear you, it makes them money.

Still, if a US president can no longer talk to another president without being accused of treason, you’re in a scary predicament.

At some point you’re going to need real proof. And Bob Mueller is not going to get it for you. That’s what his indictment of the 12 Russians, as well as the moment he released it, makes abundantly clear. Mueller is -forever- going to hide behind the ‘Trust me, I’m the FBI’ line. Well, he betrayed you before. Wisen up. Demand evidence.

We know Mueller betrayed America when he made false claims over WMD. We have no evidence that Trump betrayed his country, we have only allegations. He may be a poor choice for president, but that’s not the same thing.

 

 

Apr 212018
 
 April 21, 2018  Posted by at 12:43 pm Finance Tagged with: , , , , , , , , , , ,  


Arthur Rothstein Lower Broadway, New York 1941

 

British media report today that Donald Trump may visit the country in late summer. (Renewed) calls for mass protests are everywhere, of course. The Metro news outlet features a picture of a pamphlet that reads No To Racism. No To Trump, that dates from an earlier occasion (Trump was supposed to come several times, but never did).

Now, good luck with those protests, it’s still a free country, in name at least. But boy oh boy, would you guys miss the point. Because as we now all know – or could-, your country is being governed by a group of people who are so racist they make even Trump’s fake tan pale in comparison. If Theresa May is still in office by the time Trump visits, you’re all a bunch of racists.

Both May and her Home Secretary Amber Rudd – and you all know they’re far from alone- look so completely deranged in reports about the Windrush scandal that you will have to get rid of them first, or else shut up about Trump because you will have no moral ground whatsoever left on which to protest his visit.

For those of you who don’t know what Windrush is about, and if you’re British you have no excuse not to know, it’s the name given to a group of people who arrived, on invitation, in Britain between the late 1940s and early 1970s, often as children, and whose legal status in the country is now put in so much doubt that some have already been deported, some are denied health care, and all live in fear. Despite having lived and worked and paid taxes all their lives.

There are many instances of people who have never left Britain for a family visit, some who can’t see their own children because they did go for that visit and weren’t allowed back in, the entire story is so appalling and disastrous it’s hard to read the various reports on it. The common denominator of all of these people? They are black.

 

Windrush: When Even Legal Residents Face Deportation

In the aftermath of World War II, the British government invited thousands of people from Caribbean countries in the British Commonwealth to immigrate to the United Kingdom and help address the war-torn country’s labor shortages. Now, nearly 70 years later, many of those same people, now elderly, are having their legal status in the country questioned and are facing deportation. Though the deportation threats date as far back as October, the crisis burst into wider view this week after Caribbean diplomats representing a dozen Commonwealth nations chastised the U.K. government publicly. “This is about people saying, as they said 70 years ago, ‘Go back home.’ It is not good enough for people who gave their lives to this country to be treated like this,” Guy Hewitt, the high commissioner from Barbados to the U.K., said at a gathering of the diplomats.

As for the Guardian, which claims it broke the story, here’s a question: where were you all those years? As for Theresa May, who when she occupied the Home Office from 2010-2016 and devised all manner of tough-on-immigrants measures that have now spread to people the UK itself invited into its nation: you have to go. You cannot continue to be the face of Britain, because you blemish any and all of your fellow country men and women.

 

 

As for Donald Trump, as much as we would like to engage in constructive criticism of the man and his government, we find we no longer can. The anti-Trump echo-chamber has turned so deafening that any intelligent debate about his policies is being drowned out amid the never ending flow of fake news and half truths and innuendo and empty smears that US media continue to spout. With a brief lull when the bombs fell on Syria.

Thank you, New York Times, WaPo, CNN, MSNBC. Thank you for killing the entire discussion, thank you for killing off journalism. There is a lot to say about Trump, much of it critical, but we can no longer open our mouths. Because we don’t want to be in the same camp as you. Life in the echo chamber has given us vertigo. We had to get out.

And now, what are you going to do? The DNC lawsuit-for-campaign-cash which was launched yesterday against everything Trump, plus Wikileaks, plus everything Russia, may appear to you to be a nice and juicy next episode in your ‘impeach the comb-over’ narrative, but if I were you, I’d be careful. Because the suit creates the ideal ground upon which the empire can strike back.

And the counter suits look a lot stronger. The DNC has nothing on Russia, Wikileaks and most Trump affiliated people and organizations, as the Mueller investigation has shown by now. But Loretta Lynch, the “Pakistani mystery man”, Debbie Wasserman Schultz, Comey, McCabe, and many more around Hillary Clinton, that’s a whole different story.

First of all, they haven’t been investigated for well over a year. But can you see Rosenstein now still refusing to appoint a second special counsel and going after anything Democrat? It would cost him his job, and for good reason. And then what will the place of the echo chamber be? What have been your sources on Trump et al over the past, let’s say, 18 months? How are you going to report on your own role? Someone’s going to ask these questions.

And, you know, you do know that at least someone will name Trump for the Nobel Peace Prize if he pulls off ‘pacifying’ North Korea. How will you address that? See, you can’t praise the Donald anymore even if he does achieve things -other than missiles-, and we can’t criticize him anymore for what does indeed go wrong because you monopolized that criticism with your opinionated 24/7 non-news. While claiming to be the serious press.

Trump must be very grateful to you for what you’ve done. Come to think of it, perhaps that second special counsel should look into any payments you have received from Russia. Because nobody has helped Trump more than you have. Except perhaps for the Britons who plan to protest his visit with their racist prime minister.

Why do I feel like most of the world has lost its compass? Like we’re all just aimlessly bobbing around on a sea of meaningless words? You know, Trump territory.

 

 

Jan 292018
 
 January 29, 2018  Posted by at 8:02 pm Finance Tagged with: , , , , , , , , , , ,  


Lucien Hervé The Accuser, Delhi, India 1955

 

Tomorrow we have the State of the Union. Donald Trump will be gloating from ear to ear, but he’ll be subdued – by his standards. Expect perhaps $1 or even $1.5 trillion in infrastructure spending to be announced, plus an immigration plan that gives Democrats much of what they want in exchange for some of the things Trump wants, as well as more on trade surpluses and deficits. The Democrats will attempt to turn it into a circus of sorts by bringing guests, and they will fail.

What America needs right now is dialogue, but it’s only moving further away from it. Anything that’s wrong with anything or anyone gets blamed on Trump. By half the population. That’s nice and easy and convenient, but it doesn’t lead anywhere.

This pic, even though it features a very dumb question, says a lot about where the country stands, and it’s not standing pretty. Everybody’s just busy confirming their own opinions 24/7, egged on by networks, newspapers and social media. It’s like Moses split the nation.

 

 

Watched the Trump speech in Davos last week. He made all the points you would expect him to. No scandals, nothing anyone could blame him for. In fact, it’s true that the US economy is doing well, in Trump terms. They’re not my terms, because they laud stock markets that quit being actual markets the moment the Fed and it global brethren killed off price discovery. But in Trump terms a record S&P 500 is all you need to know, alongside low unemployment numbers, even if the latter have everything to do with underpaid shit jobs robbed of all benefits American workers once fought so hard for.

In Trump’s view, that’s a good thing. In mine, it’s a recipe for mayhem. I was watching CNN in the build-up to the speech, and Trump’s denial of the NYT report that he had intended to fire Special Counsel Robert Mueller was completely ignored. Like he never said it. At CNN, anonymous sources have -way- more credibility than the president. That’s a bit of a problem.

After the speech, all sorts of people were interviewed, and Joe Stiglitz of Nobel Memorial fame was one of them. He couldn’t muster anything better than that Trump is a bigot, a misogynist and a racist. That’s a terribly poor reaction to a speech like the one we saw and heard -which included not one word that would make any sane person think of these ‘topics’-, certainly from an economist.

 

The 1-year-old Donald Trump presidency has brought us a lot of new things, but none more significant than that Trump has been under investigation since day 1 (and even before that). This sets a dangerous precedent that will resound through US politics for a very long time to come, not least of all because today, one year into the presidency, none of the investigations has resulted in anything tangible, while they continue without a finish line in sight.

The problem with that is that if you can do it with one president, someone will do it with the next one and the next one after that as well. Which does great damage not to Trump, but to the entire US political system, and the Office of the President of the United States in particular. If the office cannot command sufficient respect on Capitol Hill to limit any such investigation to an absolute minimum, in deference to what it represents, why would anyone else, domestically or abroad, show such respect?

Obviously, some people may claim that the situation is unique, simply because it concerns Trump, but that argument doesn’t fly very far, because he was elected president, the culmination of a process that, given the powers endowed upon the office, should be close to sacred in the country. And if the very people (s)he must most closely work with, in the Senate and the House, are willing to subject a newly elected president to endless investigations without producing any results for a whole year, where and what are the limits?

It is at present of course all based on opaque accusations of the Trump campaign working with Russian intelligence to swing America’s election process in favor of the president. But to date, four different committees on Capitol Hill, plus Special Counsel Robert Mueller, have made nothing public that proves any such ‘collusion’. And Mueller’s investigation is not only unlimited in time, it’s also unlimited, in practical terms, in scope: whatever is deemed even possibly, perhaps, linked to collusion with Russia, goes.

 

The American empire was built, once it had acquired enough geopolitical, financial and military power, on invading countries and turning them into shithouses. It wasn’t and original idea, America wasn’t the first country to do it, but it’s certainly been no. 1 in applying the ‘tactic’ over the past 100 years and change. Which makes it curious that when its own elected president calls some countries shithouses, that is treated like the worst thing anybody could have said anytime in history. And racist too, allegedly.

The entire country was built on racism, and it’s still to his day almost exclusively run by white males. Much of the racism may be hidden by now, but it’s still very much there. Go look at Baltimore, Chicago, Milwaukee, and the long list of black kids killed by white cops. It’s not much use trying to claim that America is over its past. But Trump is singled out as a racist, though it’s unclear what would make him worse than others.

And on Martin Luther King Day, all Democrats and many Republicans fell over each other once again claiming they knew exactly what Dr. King stood for in his days, and what he would have said if he were alive today (the same they thermselves say). They don’t have a clue. The only way to honor MLK is to assume he would have been lightyears ahead of you. To assume he would have condemned all US foreign as well as domestic policy, and the likes of Bill Clinton, both George Bushes, Trump, and even Obama, wouldn’t even have had a remote chance of becoming president.

 

Allegedly Trump never said “shithole countries”, but instead talked about “shithouse countries”. Which would explain why he could say he never used the language he was quoted as having used (“Why are we having all these people from shithole countries come here?”) That a private conversation with lawmakers held in the Oval Office was leaked again within no time will not only frustrate Trump to no end, it also paints a dangerous picture of the future of US politics.

What used to be the exclusive domain of police officers and TV series, the catchy line “anything you say can and will be used against you”, no longer applies only to suspected criminals, from here on in it should be read to American presidents too. Trump and his successors will no longer be able to discuss policy in the White House, they must assume everything they say will be in the press within hours if not minutes. That is dangerous.

But let’s dig some more. And ask ourselves what is worse, let alone more racist: turning nations into shithouses or calling them that after the fact. Half the planet was encouraged to speak out in indignation at the use of the term, but where were all those Americans when the bombs and drones were unleashed upon Syria, Libya, Iraq? Where were the media?

Trump singled out Haiti and El Salvador. Two completely different ‘cases’. But also too complete basket cases (another word for shithouse) , compared to their potential. Haiti was the first slave colony to liberate itself, under black rule. That was in 1804, and if you know what Americans’ view of slaves and black people in general was back then, you can imagine how the former no. 1 global sugar producer was treated. By France, the country that had ruled it, but also by America. And you want to claim Haiti is not a shithouse country today? Go to Port-au-Prince and ask people living in the poor part of town how they feel about that.

As for African countries, the Congo is always a good example. The richest nation on the planet when it comes to natural resources, and one of the poorest when it comes to living standards. Long governed by a regime under Belgium’s King Leopold, matched in cruelty only perhaps by Germany in WWII, the Congo is still maintained as a hellhole to this day. So American and European conglomerates can dig up the metals and minerals almost for free. Not a shithole, a hellhole.

No, Trump is not going to solve that, but he didn’t make it what it is either. Generations of Americans did that. Yeah, we understand why they don’t want it named the way Trump has.

Perhaps the best illustration of how convoluted the entire issue quickly became after Trump said shithouse, which then became shithole, is this LA Times article, which starts out with the headline that Americans with African roots ‘should’ all be insulted, but then rapidly devolves into something else altogether, that insults them a lot more: the history of American involvement in their countries. Slavery, occupation, warfare, plunder.

 

For Black Americans, Trump’s ‘Shithole’ Comment Was An Insult To Their Histories

Kimberly Atkins, the Washington bureau chief of the Boston Herald, recently did a DNA test “that pretty much confirmed my heritage is 100% the result of the slave trade,” she wrote in a private message on Twitter. “Eighty-seven percent from western coastal African countries and 13% European, all migrated by way of the American South.”

She traced part of her heritage to an ancestor who fought in the Union during the Civil War to guarantee his freedom and the abolition of the U.S. slave trade. “My ancestors did not come from shithole countries,” she tweeted. “They were neither tired nor poor. They were forcibly brought here to live in a shithole created for them.”

Trump’s singling out of Haiti was particularly frustrating for descendants from the Caribbean nation, coming as the nation mourned the eighth anniversary of an earthquake that killed hundreds of thousands of residents.

“Haiti is not unacquainted with racists or white supremacists. We defeated our share of them in 1804 when we became the world’s first black republic,” Haitian American author Edwidge Danticat wrote in a post on Facebook, expressing her frustration that Haitians’ mourning was being diverted by an insult from Trump.

Danticat’s father came to Brooklyn, N.Y., to drive a taxicab “sometimes sixteen hours a day, so that my three brothers (two teachers and an IT specialist) and I could have a better life,” Danticat wrote.

Danticat added: “We are also the country that the United States has invaded several times, preventing us from consistently ruling ourselves. If we are a poor country, then our poverty comes in part from pillage and plunder.”

Clint Smith, a writer and PhD candidate at Harvard University specializing in sociology and education, said that he hoped that at least the president’s remarks would prompt a fuller conversation about past U.S. and European involvement with the countries Trump mentioned — countries still troubled by the legacy of colonial rule and military interventions.

“You can’t understand the economic conditions in which Haiti exists now without understanding the centuries and centuries of direct imperialism and violence and economic exploitation that the country experienced after the Haitian revolution of 1804,” Smith said. “We can’t have a real conversation about what is happening, why Salvadorans are coming here, without discussing how the U.S. contributed to the civil unrest in that country.”

The larger conversation, Smith said, “is not often enough taking into account the way that U.S. policy directly contributed to the condition in which so many of these so-called shitholes are currently existing.”

 

The woman who says “My ancestors did not come from shithole countries” says it best. Before the slave traders came to ship their ancestors to Brazil and later America, their countries were not shithouses. But they did become just that after, and many if not most still are now.

From a less echo chamber-confined point of view, this little thingy is priceless:

 

 

That points to an aspect of all this that we can not ignore: the media. There has a been a profound shirt in that field, and it happened fast, it turned on a dime. The first signs were already there before the Trump presidency, but it’s all been going going gone out of the park since. Media organizations (for lack of a better term) like the New York Times, the Washington Post, MSNBC and CNN were anti-Trump from the get-go, but it was when they found out their attitude was commercially very interesting that they really went for it.

And in a way, that made sense; they all had big problems trying to adapt their business models to the internet age. Then they found that publishing one after another anti-Trump piece brought them tons of new subscribers and advertisement revenue. Also for their internet presence. One stone, two birds.

The problem is that all that revenue and readership comes from one half of America, and excludes the other half. You know beforehand that anything these firms publish about Trump will be biased, and not a little bit. Much of it is based on anonymous sources, not exactly a sign of solid journalism. But it sells. And they have a business to run. We get it.

For those outside of the echo chamber, however, they have become largely unreadable and unwatchable. It’s obvious by now that someone like me, who asks a few questions and doesn’t feel comfortable in an echo chamber, will almost of necessity be ‘accused’ of being a Trump supporter. Absolute nonsense, but that’s echo chambers for you. They’re deafening and they lead to brain damage in case of long term occupancy.

Perhaps even worse are social media, where untold numbers of people revel in the notion that many others think like them, and let that carry them away to ‘heights’ they would never have thought possible. In the case of Trump, many allow themselves to call him names -in writing- they never would have dared use before, but they see echoed back to them on Twitter and Facebook et al.

That their often insults of Trump in effect show their disrespect for America’s political system would never occur to them. It’s an us against them battle, and they feel greatly emboldened by the 24/7 presence of those that are like-minded. It’s entirely unclear where this is going in the future, but it should be obvious it won’t be anywhere pretty.

Neither Bob Mueller nor those 4 committees on Capitol Hill have presented anything of substance as of now, but it’s crystal clear that Donald Trump is not being considered innocent until proven guilty. Which not only goes straight against, and into the heart of, American values and principles of justice, it also doesn’t even begin to address the real problem.

The real problem, and it’s not new at all, is that both US political parties might as well be run by Tony Soprano. The presence inside party leadership of people like Steve Wynn is ridiculous, but so is that of John Podesta. That is undoubtedly blindingly obvious for a vast majority of Americans, but it’s not what they focus on. They focus on Trump instead, on the still contagious obsession with impeaching him, even though many understand that wouldn’t solve any of the underlying issues.

 

And then Trump gets to present great economic numbers tomorrow. The numbers are mostly fake, but they’re the same ones that the echo chamber media also use, so they’ll have to tackle him somewhere else. They’ll come up with something, don’t worry. Their audience will just wait to be fed the usual pre-chewed bite-size fare anyway.

America needs a dialogue. But all it has left is loud, echoing, deafening, monologues. And plenty shithouse counties and cities and neighborhoods within its own borders as well. For which, too, it’s useless to blame Trump. He’s just the logical conclusion of years of blindness, ignorance, greed, stupidity and neglect. All of which, as long as everyone focuses on him, are guaranteed to continue.

Trump is not what’s wrong with America. Rather, what is wrong with America is what has given it Trump. Someone asked God for a sign and He said: here you are.

 

 


Little shithouses for you and me

 

 

Dec 292017
 
 December 29, 2017  Posted by at 10:16 am Finance Tagged with: , , , , , , , , , , ,  


Vincent van Gogh Snowy landscape with Arles in the background 1888

 

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Natural Time Cycles: A Dow Forecast For 2018-2020 (Freeze)
Trump Says Russia Inquiry Makes US ‘Look Very Bad’ (NYT)
Russiagate Is Devolving Into an Effort to Stigmatize Dissent (Carden)
US Fiscal Path Will Rattle the Rafters of the Casino – Stockman (SG)
China May Be A Bigger Worry For 2018 (CNBC)
China’s Leaders Fret Over Debts Lurking In Shadow Banking System (R.)
China Temporarily Waives Taxes To Get Foreign Firms To Stay (AFP)
How Far the Scams & Stupidities around “Blockchain Stocks” are Going (WS)
IRS Guidance on Property Taxes Has the US Confused (BBG)
Turns out, Uber Shareholders Are Eager to Sell at 30% Discount (WS)
UK Holds Back Historic Files on EU as It Prepares for Brexit (BBG)
Greek Migration Ministry Responds To Criticism Over Island Camps (K.)

 

 

Gann is all the vogue these days. Why has it taken so long? Lots of graphs here.

Natural Time Cycles: A Dow Forecast For 2018-2020 (Freeze)

The analysis and forecasts presented in this article are based on the analytical framework of W.D. Gann. Gann is an investing legend, labeled as genius by many financial historians. He reportedly accumulated $50 million in profits during his trading career. His superior track record and those of others using his methods argues that, regardless of our opinion of his methodology, we should heed the advice of his work. A more detailed explanation of his analytical framework is included in the last section of this article.

Forecast: 2018-2020

The Dow Jones Industrial Average forecast, in the graph above, is based upon the natural 20-year cycle that Gann identified. The lines in the graph show the projected monthly cumulative percentage returns from the peak level. The yellow line is the average scenario and the aqua line is the pessimistic scenario. The graph provides monthly estimates for 2018. The last data point represents June 2020, which covers the entire 30-month period from December 2017. My average scenario forecasts a -15.29% price return for 2018. The cumulative price return is forecast to bottom in June 2020 at -20.39%, at which time an extended rally should ensue. My pessimistic scenario forecasts a -32.90% price return for 2018. The cumulative price return is forecast to be little-changed in June 2020 at -31.23%, at which time an extended rally in should ensue.

Read more …

The New York Times feels obliged to cede the stage to the one person they’ve sought to discredit for the past 2 years. Must be humiliating.

Trump Says Russia Inquiry Makes US ‘Look Very Bad’ (NYT)

President Trump said Thursday that he believes Robert S. Mueller III, the special counsel in the Russia investigation, will treat him fairly, contradicting some members of his party who have waged a weekslong campaign to try to discredit Mr. Mueller and the continuing inquiry. During an impromptu 30-minute interview with The New York Times at his golf club in West Palm Beach, the president did not demand an end to the Russia investigations swirling around his administration, but insisted 16 times that there has been “no collusion” discovered by the inquiry. “It makes the country look very bad, and it puts the country in a very bad position,” Mr. Trump said of the investigation. “So the sooner it’s worked out, the better it is for the country.”

Asked whether he would order the Justice Department to reopen the investigation into Hillary Clinton’s emails, Mr. Trump appeared to remain focused on the Russia investigation. “I have absolute right to do what I want to do with the Justice Department,” he said, echoing claims by his supporters that as president he has the power to open or end an investigation. “But for purposes of hopefully thinking I’m going to be treated fairly, I’ve stayed uninvolved with this particular matter.” Hours after he accused the Chinese of secretly shipping oil to North Korea, Mr. Trump explicitly said for the first time that he has “been soft” on China on trade in the hopes that its leaders will pressure North Korea to abandon its nuclear weapons program. He hinted that his patience may soon end, however, signaling his frustration with the reported oil shipments.

[..] Mr. Mueller’s investigation appears to be moving ahead despite predictions by Mr. Trump’s lawyers this year that it would be over by Thanksgiving. Mr. Trump said that he was not bothered by the fact that he does not know when it will be completed because he has nothing to hide. Mr. Trump repeated his assertion that Democrats invented the Russia allegations “as a hoax, as a ruse, as an excuse for losing an election.” He said that “everybody knows” his associates did not collude with the Russians, even as he insisted that the “real stories” are about Democrats who worked with Russians during the 2016 campaign. “There’s been no collusion. But I think he’s going to be fair,” Mr. Trump said of Mr. Mueller.

[..] Mr. Trump said he believes members of the news media will eventually cover him more favorably because they are profiting from the interest in his presidency and thus will want him re-elected. “Another reason that I’m going to win another four years is because newspapers, television, all forms of media will tank if I’m not there because without me, their ratings are going down the tubes,” Mr. Trump said, then invoked one of his preferred insults. “Without me, The New York Times will indeed be not the failing New York Times, but the failed New York Times.” He added: “So they basically have to let me win. And eventually, probably six months before the election, they’ll be loving me because they’re saying, ‘Please, please, don’t lose Donald Trump.’ O.K.”

Read more …

Russiagate has turned into a huge embarrassment.

Russiagate Is Devolving Into an Effort to Stigmatize Dissent (Carden)

Of all the various twists and turns of the year-and-a-half-long national drama known as #Russiagate, the effort to marginalize and stigmatize dissent from the consensus Russia-Trump narrative, particularly by former intelligence and national-security officials and operatives, is among the more alarming. An invasion-of-privacy lawsuit, filed in July 2017 by a former DNC official and two Democratic donors, alleges that they suffered “significant distress and anxiety and will require lifelong vigilance and expense” because their personal information was exposed as a result of the e-mail hack of the DNC, which, the suit claims, was part of a conspiracy between Roger Stone and the Trump campaign.

According to a report in The New York Times published at the time of the suit’s filing, “Mr. Trump and his political advisers, including Mr. Stone, have repeatedly denied colluding with Russia, and the 44-page complaint, filed on Wednesday in the Federal District Court for the District of Columbia, does not contain any hard evidence that his campaign did.” (Emphasis added.) In a new development, in early December, 14 former high-ranking US intelligence and national-security officials, including former deputy secretary of state William Burns; former CIA director John Brennan; former director of national intelligence James Clapper; and former ambassador to Russia Michael McFaul (a longtime proponent of democracy promotion, which presumably includes free speech), filed an amicus brief as part of the lawsuit.

The amicus brief purports to explain to the court how Russia deploys “active measures” that seek “to undermine confidence in democratic leaders and institutions; sow discord between the United States and its allies; discredit candidates for office perceived as hostile to the Kremlin; influence public opinion against U.S. military, economic and political programs; and create distrust or confusion over sources of information.” The former officials portray the amicus brief as an offering of neutral (“Amici submit this brief on behalf of neither party”) expertise (“to offer the Court their broad perspective, informed by careers spent working inside the U.S. government”).

The brief claims that Putin’s Russia has not only “actively spread disinformation online in order to exploit racial, cultural and political divisions across the country” but also “conducted cyber espionage operations…to undermine faith in the U.S. democratic process and, in the general election, influence the results against Secretary Hillary Clinton.”

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“The Fed will sell more bonds in the next 3-4 years than had been accumulated by all of the central banks of the world in all of recorded history as of 1995!”

US Fiscal Path Will Rattle the Rafters of the Casino – Stockman (SG)

[..] the US government is spending money like a drunken sailor. But nobody really seems to care. Since Nov. 8, the US national debt has risen $1 trillion. Meanwhile, the Russell 2000 (a small-cap stock market index) has risen by 30%. Former Reagan budget director David Stockman said this makes no sense in a rational world, and he thinks the FY 2019 is going to sink the casino. In a rational world operating with honest financial markets those two results would not be found in even remotely the same zip code; and especially not in month #102 of a tired economic expansion and at the inception of an epochal pivot by the Fed to QT (quantitative tightening) on a scale never before imagined.” Stockman is referring to economic tightening recently launched by the Federal Reserve. It’s not only the increasing interest rates.

By next April the Fed will be shrinking its balance sheet at an annual rate of $360 billion and by $600 billion per year as of next October. By the end of 2020, the Fed will have dumped $2 trillion of bonds from its books. Stockman puts this into perspective. So the net of it is this: The Fed will sell more bonds in the next 3-4 years than had been accumulated by all of the central banks of the world in all of recorded history as of 1995!” Now pause for just a moment and think about this. The GOP just passed a tax plan that will add another $1.5 trillion to the deficit. And word is Trump’s next big push will be to pass an infrastructure bill – even more spending and debt. Meanwhile, during a time of rising debt, the Fed will be flooding the market with bonds. And what do governments have to do to finance debt? That’s right. They sell bonds.

There is literally a fiscal red ink eruption heading straight at the Fed’s balance sheet shrinkage campaign that will rattle the rafters in the casino … Uncle Sam’s borrowing requirements are likely to hit $1.25 trillion or more than 6% of GDP in FY 2019 owing to the fact that the tax bill is so heavily front-loaded and the GOP’s wild spending spree for defense, disasters and much else.”

Read more …

It’s starting to feel like Xi is seriously stuck. Let zombies default, and accept the lost jobs and mom and pop investments, or keep propping them up.

China May Be A Bigger Worry For 2018 (CNBC)

For a market dependent on synchronized global growth, investors may be betting too much that China will not rock the boat next year. Part of the S&P 500’s rally to record highs this year comes on the back of better economic growth around the world. A major contributor to that growth was stability in China as leaders prepared for a key 19th Communist Party Congress this fall. Now that the congress is over and Beijing looks set to take action on its growing debt problems, worries about a sharper-than-expected slowdown in the world’s second-largest economy could hurt U.S. stocks. “With the 19th Party Congress now behind us, the risk is that the peak growth in China is also behind us,” David Woo, head of global rates, FX and EM FI strategy & econ research at Bank of America, said in an outlook report.

“Curiously, the market has been ignoring the string of negative Chinese data surprises in recent weeks. It is possible that the market views them as temporary.” “We are concerned that China could be vulnerable to US tax reform getting done,” Woo said, noting that a resulting increase in U.S. rates and the U.S. dollar would likely cause capital flight from China to accelerate and weaken the Chinese yuan. If that happens, China’s central bank would be likely “to tighten liquidity, which in turn would raise further concerns about the growth outlook,” he said. Fears of negative spillover from a rapid slowdown in China’s economy hit global markets in August 2015 after a surprise yuan devaluation. Further weakness in the currency in the first few weeks of 2016 contributed to the worst start to a year on record for both the Dow and S&P 500.

Since then, Chinese authorities have proven they are still able to control their economy. But stability has come at the cost of ever-increasing debt levels. The IMF warned in October that China’s banking sector assets have risen steadily to 310% of GDP from 240% of GDP at the end of 2012. S&P Global Ratings downgraded China’s long-term sovereign credit rating in September, following a similar downgrade by Moody’s in May. “If clusters of credit defaults start to form, concerns about contagion into the wider economy could take hold if fears of default in wealth management products arise,” UBS Wealth Management’s chief investment office said in its 2018 outlook. “Should this happen, the Chinese government, in our view, would likely have sufficient resources to prevent widespread contagion.”

Read more …

Xi made the conscious choice to rise on the shadow’s coat tails. Now he has to keep riding or else.

China’s Leaders Fret Over Debts Lurking In Shadow Banking System (R.)

Before the 2008 financial crisis, there was very little shadow banking in China. In the aftermath of that shock, Chinese authorities launched a massive effort to stimulate the economy, mostly through a huge increase in lending. This led to a boom in property and infrastructure spending that continues today. Demand for credit increased sharply, especially from local and municipal government-owned companies. To meet this demand, banks began selling wealth management products offering higher interest rates than normal deposits. Many investors believed these products were implicitly guaranteed by the issuer, even if it was not expressly stated in the contract. Banks also borrowed cash from other banks and companies. For banks, these funds can then be lent to borrowers prepared to pay higher rates.

But the banks want to sidestep rules designed to restrict lending to overheated sectors including property, mining and other resources. So, people in the shadow banking industry say, these loans are often disguised by directing them through a complex chain of intermediaries, including trusts, securities companies, other banks and asset managers. To earn interest on these loans, a bank will buy a financial product from one of the intermediaries, which directs earnings back to the bank. That allows the bank to describe what is really a loan as an investment on its books. This type of lending can be more profitable because banks can set aside much less capital than they are required to hold for regular loans as a safeguard against defaults. By the end of 2015, shadow lending was growing faster than traditional bank lending, and was equivalent to 57% of total bank loans, according to a 2016 report from investment bank CLSA.

This dramatically accelerated the speed at which overall debt expanded in China’s financial system. Moody’s said in a November report that China’s shadow banking assets grew more than 20% in 2016 to 64 trillion yuan ($9.8 trillion), equivalent to 86.5% of GDP. [..] At the center of shadow banking are the 12 nationally licensed joint stock banks and many of the more than 100 city commercial lenders which hold about a third of China’s commercial banking assets. From 2010, these mid-tier banks and regional lenders set about competing with the country’s so-called Big Five lenders, the state-controlled behemoths that dominate the economy. The key to the upstarts’ growth is selling wealth management products and borrowing from other banks, allowing them to create loans wrapped in financial instruments to give the appearance of investments.

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Translation: foreign reserves are fleeing. Blame the Trump tax plan.

China Temporarily Waives Taxes To Get Foreign Firms To Stay (AFP)

China will temporarily waive income taxes for foreign companies on profits they reinvest in the country as Beijing battles to retain foreign firms and investment. The finance ministry announced Thursday the new tax policy, which will apply retroactively from January so businesses will be able to take advantage of the exemption for this year’s taxes. The new incentives for foreign business to keep their earnings in China follow the passing last week of a corporate tax overhaul in the United States. The US reform will lower the tax rate for most corporations to 21%. Businesses in China pay 25%. The temporary exemption “will create a better investment environment for foreign investors and encourage foreign investors to sustain their investments in China,” a spokesman for the ministry of commerce said.

The policy announcement also comes as China has struggled with capital flight and tightened capital controls this year to stem the outflow of money. But foreign companies have long complained of the onerous bureaucracy they must navigate, barriers to market access, and policies that favour local firms. The new tax incentives aim to make China more attractive but come with a slew of restrictions. To be eligible, the profits must be invested in industries and activities where the Chinese government encourages foreign investment: manufacturing, services, research and development. Locations in the west of the country are also prioritised for development. Companies have three years to apply for the exemptions after paying tax.

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“This can happen only during the very late stage of a bubble.”

How Far the Scams & Stupidities around “Blockchain Stocks” are Going (WS)

It just doesn’t let up. UBI Blockchain Internet, a Hong Kong outfit whose shares trade in the US [UBIA], filed with the SEC to sell an additional 72.3 million shares owned by its executives. In other words, it isn’t selling the shares to raise money for corporate purposes, but to allow its executives, including CEO Tony Liu, to bail out. This is happening after the company – which sports zero revenues and a disconnected phone number in its SEC filings – managed to get its shares to spike briefly by over 1,100%, pushing its market capitalization to $8 billion. UBI Blockchain didn’t do an IPO. Instead, in October 2016, it acquired a publicly traded shell company registered in Las Vegas, called “JA Energy.” It then changed the name and ticker symbol to what they’re now.

Over the six trading days starting on December 11, 2017, its shares soared over 1,100%, from $7.20 to $87 on December 18, as the word “blockchain” in its name and sufficient hype and speculator-idiocy took hold. By December 21, shares had plunged 67% to $29. They closed on Wednesday at $38.50. At this price, it still has a ludicrous market cap of $3.64 billion. In its prospectus for the share sale, filed with the SEC on December 26, UBI explains the overcooked spaghetti of its dreamed-up activities: UBI Blockchain Internet Ltd. business encompasses the research and application of blockchain technology with a focus on the Internet of things covering areas of food, drugs and healthcare. Management plans to focus its business in the integrated wellness industry, by providing procedures for safety and effectiveness in food and drugs, but also preventing counterfeit or fake food and drugs.

With the advancement of the blockchain technology, the Company plans to trace a food or drug product from its original source within the context of the Internet of Things to the final consumer. It explains that “management is uncertain that the Company can generate sufficient revenues in the next 12-months to sustain our operations. We shall need to seek additional funding to continue our operations and implement our plan of operations.” It added that “due to the uncertainty of our ability to meet our financial obligations and to pay our liabilities as they become due,” the auditors in the financial statement for the year ended August 31, 2017, questioned “our ability to continue as a going concern.” For the year, UBI had an operating loss of $1.83 million on zero revenues. It had $15,406 in cash, and: “In order to keep the company operational and fully reporting, management anticipates a burn rate of approximately $220,000 per month, pre and post-offering.”

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Overtime for accountants.

IRS Guidance on Property Taxes Has the US Confused (BBG)

New guidance from the Internal Revenue Service that limits taxpayers’ ability to deduct prepaid property levies on their 2017 tax returns is causing confusion nationwide as people rush to pay in advance without knowing whether they’re wasting their time and money. The IRS said Wednesday that taxpayers can deduct prepaid state and local property taxes for 2018 on 2017 returns only if the taxes were assessed before 2018. The brief guidance – which doesn’t define the term “assessed” – had local tax officials scratching their heads. Some see the issue as an early signal of far wider confusion that’s coming soon – the predictable result of passing a bill that rewrites the tax code just two weeks before many of the changes take hold.

“This is the tip of the iceberg as state and local governments try to figure this out – and by the way, they’re trying to figure it out with one week before the changes take effect,” said Richard Auxier, a researcher with the Urban-Brookings Tax Policy Center, a Washington public policy group. “And that week happens to be the week between Christmas and New Year’s.” The IRS guidance comes after many state and local officials – including New York Governor Andrew Cuomo and New Jersey Governor Chris Christie – have taken pains to clear the way for their residents to accelerate property-tax payments. The nationwide flurry came ahead of the new tax law that will cap property tax deductions – along with those for state and local income taxes or sales taxes – at an overall total of $10,000.

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Uber just lost a third of its valuation.

Turns out, Uber Shareholders Are Eager to Sell at 30% Discount (WS)

Softbank, an acquisitive junk-rated Japanese holding company that also owns about 80% of Sprint, has been preparing for months to buy a large stake in Uber. At the end of November, it launched a tender offer to buy enough shares from investors and employees to give it a 14% stake. It dangled out a price of $33 a share, which valued Uber at $48 billion – a 30% discount from Uber’s “valuation” of $69 billion, which had been established behind closed doors during the last fund-raising round. The offer at a $48-billion valuation is even lower than Uber’s valuation back in June 2015 of $51 billion. When the tender offer was started, there was uncertainty if enough sellers would be willing to dump their shares at this discount. The other option for them would be to hold out until the IPO, in the hopes for a better deal. The tender offer expired today at noon Pacific Time.

Turns out, there are plenty of eager sellers – despite any dreams of a blistering IPO: The tendered shares amount to about 20% of the company’s equity, “people familiar with the matter” told the Wall Street Journal. But SoftBank will likely acquire only a 15% stake, “the people said.” Other members of the consortium SoftBank is leading – including Dragoneer Investment Group and Tencent Holdings – are likely to buy some but not all of the remaining tendered shares. This deal will not raise money for Uber itself but will allow employees and early investors to cash out some of their holdings – at a steep discount. But to maintain the illusion of the previous “valuation” of $69 billion – which is critical for a properly hyped future IPO – SoftBank will also make a $1-billion direct investment into Uber at the $69-billion “valuation,” as part of the deal.

Since startup “valuations” are based on the price paid during fund-raising, this $1-billion deal forms Uber’s new “valuation,” the same as the prior one. So the “valuation” illusion remains intact. [..] SoftBank already owns major stakes in other rideshare startups, including Didi Chuxing, the largest rideshare company in China; Grab, a major rideshare company in Southeast Asia; Ola, the largest rideshare company in India, slightly ahead of Uber; and 99, the largest rideshare company in Brazil. So SoftBank is serious about getting into this business on a global scale. But all rideshare companies are competing with each other, with taxis, rental cars, mass transit, and other modes of transportation on service and low fares, and they’re competing with each other to rope in drivers by offering them incentives.

The plan is to dominate the markets. And all of them are losing money hand over fist. The chart below shows what quarterly “adjusted” losses look like for Uber. Actual losses under GAAP would be much larger since the costs of employee stock compensation, interest, taxes, depreciation, and amortization have been stripped out of the figures that Uber shows the media:

Read more …

It’s hard to keep track of all the Monty Python moves at Downing Street 10.

UK Holds Back Historic Files on EU as It Prepares for Brexit (BBG)

As Prime Minister Theresa May prepares for the next round of Brexit negotiations, her government has held back publication of secret files relating to the creation of the European Union. The documents from 1992 were due to be released Friday at the National Archives under British rules that allow government papers to enter the public domain. Out of 495 files from the prime minister’s office that year, a total of 114 were held back. Of those, 12 related to European policy. The main opposition party was quick to pounce. Jon Trickett, a high-ranking Labour politician described it as “profoundly shocking, particularly given the current state of the national debate.”

May’s government has had a series of problems with information around Brexit. Last week, after months of ministers trying to keep them secret, the government published an assessments of how different segments of the economy will cope with leaving the EU. Lawmakers commented that the documents contained little that couldn’t be found on Wikipedia. The Cabinet Office, which supports May in running the government, said in an email that “there is no question that any files are deliberately ‘withheld’ from the media.” A further 26 files covering the EU were sent to the archives too late for journalists to read them before publication.

It explained that “we have to ensure all files are properly reviewed and prepared before they are transferred, so that they do not harm national security or our relations with other countries or disclose the sensitive personal data of living individuals.” The files that were released reveal the extent to which Britain’s 1992 expulsion from the Exchange Rate Mechanism turned Conservatives against Europe. That year, Sept. 16 was christened “Black Wednesday” after the government’s failed attempt to keep the pound within the system by pushing interest rates up to 15%.

Read more …

Everybody accuses everybody else, because assigning the blame is more important than helping the refugees.

Greek Migration Ministry Responds To Criticism Over Island Camps (K.)

The Migration Ministry has blamed local authorities for the grim conditions inside island migrant camps in the wake of criticism from a senior European Union official. In an interview with news website New Europe on Sunday, the EU’s special envoy on migration, Maarten Verwey, said the European Commission had made funding available to ensure appropriate accommodation for all. “However, the Commission cannot order the creation or expansion of reception capacity against the opposition of the competent authorities,” he added. Speaking to Kathimerini on Thursday, sources inside the ministry did not deny the existence of EU funds, adding however that Verwey had omitted any mention of the difficulties “although he has personal experience.”

Authorities on Lesvos and Chios have opposed government plans to expand screening centers for refugees. Meanwhile, only a small amount of the available funds have been absorbed. Of the 540 million euros earmarked until 2020, Greece has received just 97 million euros, according to the Economy Ministry. The same sources referred to recent remarks by Migration Minister Yiannis Mouzalas, who accused EU governments of “hypocrisy” for failing to shoulder their fair share of the refugee burden.

Read more …

Sep 142017
 
 September 14, 2017  Posted by at 9:30 am Finance Tagged with: , , , , , , , , , ,  


Edward Hopper Chop Suey 1929

 

Top Democrats Announce Deal With Trump To Protect ‘Dreamers’ (MW)
Fed Balance Sheet Reduction Will Reduce Funds Sent To Treasury (BI)
“You Should Take the Fed at Their Word” (WS)
“Markets Have Always Been Wrong” – Jamie Dimon (ZH)
10% of Global GDP Is Stashed In Tax Havens (BI)
Did You Know Housing Gets Counted Twice In GDP? (Murray)
The Real Earnings of Men (WS)
China’s Steel Mills Run at Full Tilt as Output Hits New Peak (BBG)
China’s Economy Cools Again (BBG)
US Senate Rejects Bid To Repeal War Authorizations (R.)
Has the NYT Gone Collectively Mad? (Robert Parry)
Crisis Brings Sea Change To Greek Housing Market (K.)
More Austerity May Be Ahead (K.)

 

 

They dine together, close a deal, and then can’t wait to tell entirely different stories to the press. But Trump has forced them into action.

Top Democrats Announce Deal With Trump To Protect ‘Dreamers’ (MW)

Top Democratic leaders said Wednesday night that they had reached a compromise agreement with President Donald Trump to enact protections for the children of undocumented immigrants in exchange for increased border security measures that do not include funding for a wall — which the White House then disputed. “We had a very productive meeting at the White House with the president,” read a joint statement from Senate Minority Leader Chuck Schumer and House Minority Leader Nancy Pelosi. “The discussions focused on DACA. We agreed to enshrine the protections of DACA into law quickly, and to work out a package of border security, excluding the wall, that’s acceptable to both sides.” But shortly after that statement, White House press secretary Sarah Huckabee Sanders disputed that border-wall funding was off the table. “Excluding the wall was certainly not agreed to,” she said.

Schumer, of New York, and Pelosi, of California, had dinner with Trump at the White House on Wednesday night. It was apparently the second bipartisan agreement between Democrats and Trump in the past week, after last week’s surprise deal that provided funding for Hurricane Harvey relief and extended the debt ceiling for three months, much to Republicans’ chagrin. Extending protections for the Deferred Action for Childhood Arrivals program, which were rescinded by the Trump administration last week, is a top priority for Democrats and many Republican lawmakers. Without new legislation, the 690,000 children of undocumented immigrants — so-called “Dreamers” — enrolled in the program could face deportation as their status expires over the next two years. Trump had said he may “revisit” the issue of Dreamers in six months if Congress didn’t act.

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It’s like driving into a dark and wet dead end alley.

Fed Balance Sheet Reduction Will Reduce Funds Sent To Treasury (BI)

The Federal Reserve is not expected to raise interest rates again until at least December, and even that increase is now in doubt given low inflation and high political uncertainty in the United States. That doesn’t mean the central bank has no plans to tighten monetary policy, however. Officials are widely expected to announce the start of a gradual reduction of the Fed’s $4.4 trillion balance sheet, which more than quintupled in response to the Great Recession and financial crisis of 2007-2009. Policymakers are hoping the shrinkage, which they intend to accomplish by ceasing reinvestments of maturing bonds back into the central bank’s portfolio, will have minimal market impact. But a previous episode in 2013 known as the “taper tantrum,” when bond yields spiked sharply higher at the mere mention of a possible end to the Fed’s bond-buying program, offers a cautionary tale.

Regardless of immediate market impact, there will be a longer term effect on the government budget, currently the subject of heated debate, that most investors and politicians are ignoring. That’s because the Fed’s bond-buying program, in addition to lowering the government’s borrowing costs at a time when weak economic activity called for bigger budget deficits, created a stream of yearly returns of nearly $100 billion for the Federal Reserve which it then siphoned back to the Treasury. Sometimes these are referred to as the Fed’s “profits,” but that is a deceptive way of describing what is in effect an intra-government transaction. “As assets under management drop, so too will revenue on that portfolio. This will be a lost revenue source for the Treasury that will raise deficits and add to the Treasury’s financing” costs, writes Societe Generale Economist Stephen Gallagher in a research note to clients.

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Downward volatility.

“You Should Take the Fed at Their Word” (WS)

The markets have been brushing off the Fed and have done the opposite of what the Fed has set out to accomplish. The Fed wants to tighten financial conditions. It’s worried about asset prices. It’s worried that these inflated assets which are used as collateral by the banks, pose a danger to financial stability. It has mentioned several inflated asset classes by name, including commercial real estate, which backs $4 trillion in loans heavily concentrated at regional banks. And yet, markets have loosened financial conditions since the Fed started its tightening cycle in earnest last December. Markets are hiding behind “low” inflation, when the Fed is focused on asset prices. So longer-term yields have been falling even as short-term yields have moved up in line with the Fed’s target rate, and thus the yield curve has flattened.

The dollar has been falling. Equities have been soaring to new highs. And companies, if they’re big enough, are able to get funding for the riskiest projects at stunningly low rates. “I think there is maybe too much confidence that the Fed is not really going to do too much more on interest rates, that we’ll have one or two more rate hikes and that’s it,” Brian Coulton, chief economist for Fitch Ratings, told Reuters on Tuesday. Market participants are expecting “just one or two interest rate increases a year” despite the Fed’s stated expectation of seeing long-run interest rates at around 3.0%. “When the Fed says they’re going to engage in a gradual rate of interest rate increases, they mean three or four rate hikes every year and we think that’s what they’re going to do,” Coulton said. “We think that you should take them at their word and it may even be a little faster than that.”

This disconnect between market expectations and the Fed’s stated intentions could create volatility in fixed-income markets when markets finally catch up, he said. Volatility, when it’s used in this sense, always means downward volatility: a sudden downward adjustment in prices and spiking yields – a painful experience for the coddled bond market with big consequences for the stock market. “We think they’re going to be … getting more worried about some of the negative consequences of QE, the fact that it encourages risk taking and may create some issues for the banks,” he said. And he expects – this is “more of a personal view,” he said – that the Fed will continue with the rate hikes, or even accelerate them, even if consumer price inflation remains low.

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“There’s low volatility until they’re highly volatile.” Sounds like Minsky.

“Markets Have Always Been Wrong” – Jamie Dimon (ZH)

Oh, listen, markets are markets. There’s low volatility until they’re highly volatile. The stock market is high until it goes low. Markets therefore have always been wrong. And I think people are making mistakes. I can give you reasons why it might be low. We’ve had this fairly consistent, coherent, consistent growth. But forget the geopolitical noise and stuff like that. We’re chugging along, 2%. Europe is doing 2%. Russia – I mean, Japan is doing 1.5%, China’s doing their 6%. You know, earnings are doing okay. We’ve had a fairly benign economic environment. That’s a reason. I can give you another reason is that the Central Banks of the world that bought $12 trillion of securities. 12 trillion. Since they started doing QE. And that’s only just the U.S. That’s an awful lot of security purchases that might – in all things be equal, and remember things are never all equal – can reduce volatility.

And there may be other sides that are known. And once other sides happen, watch out. Then volatility goes way up. They’ll say they’re a genius, they figured out when it’s going to happened. I don’t guess on which kind of volatility. Like I said, we do a business. And we have to manage the volatility.” [..] The hurricanes are irrelevant. I wouldn’t have any policy matter as a function of hurricanes. Going to reduce GDP in the short run, they’ll probably increase it after that. I’ll let the economists figure it out. But almost a $20 trillion economy, that isn’t a reason to change monetary policy. It will create a lot of noise in the numbers, but I wouldn’t overreact to that. Advice, it’s very sympathetic. We’re doing – just so you know, we’re going to do a lot for affordable housing, get these people in these states 20,000 people in Florida, 6,000 in Houston. Most of the banks are waiving fees, delaying loan payments, offering special services for your employees and stuff like that.”

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Saw the graph before. Greece is the big one here.

10% of Global GDP Is Stashed In Tax Havens (BI)

The Panama Papers and other major leaks from offshore tax havens have helped shed light on just how much money the world’s wealthiest people are parking in untaxed obscurity, away from the authorities and, importantly, economic researchers. This new evidence has helped economists gain greater insight into just how steep disparities between the rich and the poor have become, because having actual data on offshore holdings tends to widen wealth gaps considerably. Three of these researchers have teamed up on two important papers that offer a more in-depth look at what the world’s worst tax-evading and -avoiding nations are, and they find that the existence of tax havens makes inequality much worse than it appears with standard, publicly available economic data.

“The equivalent of 10% of world GDP is held in tax havens globally, but this average masks a great deal of heterogeneity—from a few % of GDP in Scandinavia, to about 15% in Continental Europe, and 60% in Gulf countries and some Latin American economies,” Annette Alstadsæter at the Norwegian University of Life Sciences, Niels Johannesen of the University of Copenhagen, and Gabriel Zucman of the University of California at Berkeley write in the first of the two articles. Global gross domestic product is about $75.6 trillion, according to World Bank figures. They then apply these estimates to build revised series of top wealth shares in 10 countries accounting for nearly half of world GDP. “Because offshore wealth is very concentrated at the top, accounting for it increases the top 0.01% wealth share substantially in Europe, even in countries that do not use tax havens extensively,” the authors write. “It has considerable effects in Russia, where the vast majority of wealth at the top is held offshore.”

About 60% of the wealth of Russia’s richest households is held offshore, the economists estimate. “More broadly, offshore wealth is likely to have major implications for the concentration of wealth in many of the world’s developing countries, hence for the world distribution of income and wealth.” “These results highlight the importance of looking beyond tax and survey data to study wealth accumulation among the very rich in a globalized world,” they continue. They say that despite lip service to transparency, “very little has been achieved” in recent years. “With the exception of Switzerland, no major financial center publishes 18 comprehensive statistics on the amount of foreign wealth managed by its banks.”

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GDP is a lousy measure.

Did You Know Housing Gets Counted Twice In GDP? (Murray)

Your car gets counted once in GDP when it is built, not when it is driven. Your clothes, your bicycle, your furniture, all get counted once when they are manufactured, and not again when they are worn, ridden, or sat on. But homes are counted twice: Once when they are constructed, and again when they are occupied. The argument to include both housing construction (as a new capital investment good) and housing occupancy (as a consumption good) arises from a conceptual trick at the heart of national accounting. That trick is to separate out two types of ‘final’ goods when adding up the ‘value-added’ in the economy, which is what GDP does. One good is a consumption good. These are goods (and services) that households consume, like clothes, food, entertainment, and so forth. All the value added at intermediate stages in the production chain of these goods can be captured by looking only at the final retail value of the goods.

That value represents the total value-added across the economy to produce that good. The other type of good is an investment good. This is a good that lasts a long time and contributes to future production. A new rail line, for example, is classified a new investment good, and the value of its production is counted in GDP, even though households don’t get any value from it until it is used to run trains. Once the rail line is being used to run trains, the value of those travel services is also counted in GDP as a consumption good, which will include within it the value contribution of the rail line itself. Thus there is a type of double-counting when it comes to investment goods — you count them when they are made, and you count them again when they are used to make consumption goods.

This is intentional. The production of investment goods is a large share of GDP — between 20 and 40% in most countries. By ignoring this production, which is also the more volatile part of production over the business cycle, GDP loses much of its value as a measure of how economically active a country is. The construction of new homes is, therefore, an investment good, which gets counted in GDP. But then the occupancy of these same homes gets counted gain as a consumption ‘home rental’ good each period after. This applies to the 70% of households (in Australia at least) who own their own home, not just the renters. Although they don’t pay themselves rent to occupy their home, GDP is calculated as if they do by ‘imputing’ the rent that homeowners would have to pay themselves if they instead rented their home.

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” On this inflation-adjusted basis, men had earned more than that in 1972″
..

The Real Earnings of Men (WS)

For women who were working full-time year-round, median earnings (income obtained only from working) rose 0.7% on an inflation-adjusted basis from a year ago to $48,328, continuing well-deserved increases over the data series going back to 1960. The female-to-male earnings ratio hit a new record of 80.5%, after steady increases, up from the 60%-range, where it had been between 1960 and 1982. And while that may still be inadequate, and while more progress needs to be made for women in the workforce, it was nevertheless the good news.

Men in the workforce haven’t been so lucky. They have experienced the brunt of the wage repression over the past four decades, obtained in part via inflation, where wages inch up, but not quite enough to keep up with the Fed-engineered loss of purchasing power of the dollar. Median earnings for men who worked full-time year-round fell 0.4% in 2016, adjusted for inflation, to $51,640. On this inflation-adjusted basis, men had earned more than that in 1972 ($52,361). And it’s down 4.4% from the earnings peak in 1973 ($54,030). This translates into 44 years of real earnings decline:

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Just in time for the Party Congress. What a lucky coincidence!

China’s Steel Mills Run at Full Tilt as Output Hits New Peak (BBG)

Steel production in China chalked up a fresh monthly record as mills in the world’s top supplier increase output to profit from a rally in prices to six-year highs before government-ordered pollution curbs are implemented. Crude steel output climbed to 74.59 million metric tons last month, surpassing the previous peak of 74.02 million in July, and up from 68.57 million in August 2016, according to the statistics bureau Thursday. While that’s an all-time high for the month, daily output was less than the record in June. Production surged 5.6% to 566.4 million tons in the first eight months, also a record. Steel prices have been supercharged this year in the country that accounts for half of global output. A crackdown on illegal mills shuttered some supply, boosting the remaining producers, while demand has been underpinned by significant state-backed stimulus.

Investors are also eyeing signals that the government will press ahead with anti-pollution curbs over winter. “Steel mills have boosted output as profit margins are good,” said Helen Lau at Argonaut Securities in Hong Kong. “Production cuts won’t set in until September or October, so steelmakers are churning out as much as they can in the meantime.” Spot reinforcement bar in China, a benchmark product used in construction, hit 4,396 yuan a ton early this month, the highest level since October 2011. Prices have gained 30% this year. Steel output may drop in coming months as Asia’s top economy presses ahead with supply-side reforms. Hebei province, the center of China’s mammoth steel industry, has plans that’ll allow for winter output cuts of as much as 50% to reduce pollution. Citigroup Inc. has estimated daily production could shrink 8% because of the environmental crackdown.

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But wait! Same source, same day, opposite views.

China’s Economy Cools Again (BBG)

The pace of China’s economic expansion unexpectedly cooled further last month after a lackluster July, as factory output, investment and retail sales all slowed. • Industrial output rose 6.0% from a year earlier in August, versus a median projection of 6.6% and July’s 6.4%. That’s the slowest pace this year • Retail sales expanded 10.1% from a year earlier, versus a projection of 10.5% and 10.4% in July, also the slowest reading in 2017 • Fixed-asset investment in urban areas rose 7.8% in the first eight months of the year over the same period in 2016, compared with a forecast 8.2% rise. That’s the slowest since 1999.

The continued cooling of the world’s second-largest economy suggests that efforts to rein in credit expansion and reduce excess capacity are hitting home ahead of the key 19th Party Congress in October. Still, producer-price inflation and a manufacturing sentiment gauge both exceeded estimates earlier this month, signaling some resilience. The Shanghai Composite Index reversed earlier gains to fall 0.4%. “Today’s data shows that the economy clearly already peaked in the first half of this year,” said Larry Hu at Macquarie in Hong Kong. “Recently both property and exports are slowing down and that’s why the whole economy is slowing.” “Regulatory tightening in the financial sector is putting a squeeze on highly indebted firms reliant on shadow bank financing,” said Frederic Neumann at HSBC in Hong Kong.

“And officials are unlikely to take their foot off the regulatory brakes any time soon. Growth therefore looks set to weaken further into year end, as regulators step up their campaign to rein in shadow banking.” “That’s still on track to a gradual moderation,” Chang Jian, chief China economist at Barclays in Hong Kong, said in a Bloomberg Television interview. “The government has been closing capacity, especially those that don’t meet environmental standards, and enforcement this year has been much stricter in the run-up to the 19th Party Congress.”

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An empire built on war.

US Senate Rejects Bid To Repeal War Authorizations (R.)

The U.S. Senate rejected an amendment on Wednesday that would have forced the repeal of war resolutions used as the legal basis for U.S. military actions in Iraq, Afghanistan and against extremists in Syria and other countries. The Senate voted 61 to 36 to kill the measure, which six months after it became law would have put an end to authorizations for the use of military force (AUMF) passed in 2001 and 2002. The legislation was offered by Republican Senator Rand Paul as an amendment to a must-pass annual defense policy bill, which lawmakers are using as a vehicle to gain a greater say in national security policy. Paul’s measure was aimed at asserting the constitutional right of Congress to approve military action, rather than the president.

Some of the other amendments address issues such as sanctions on North Korea and President Donald Trump’s ban on transgender troops in the military. Many members of Congress are concerned the 2001 AUMF, passed days after the Sept. 11 attacks to authorize the fight against al Qaeda and affiliates, has been used too broadly as the legal basis for a wide range of military action in too many countries. The majority of support for the amendment came from Democrats, who joined Paul in arguing that it is long past time for Congress to debate a new authorization for the use of force. “We should oppose unauthorized, undeclared, unconstitutional war. At this particular time, there are no limits on war,” Paul said.

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Not really. They’re just chasing illusions.

Has the NYT Gone Collectively Mad? (Robert Parry)

For those of us who have taught journalism or worked as editors, a sign that an article is the product of sloppy or dishonest journalism is that a key point will be declared as flat fact when it is unproven or a point in serious dispute – and it then becomes the foundation for other claims, building a story like a high-rise constructed on sand. This use of speculation as fact is something to guard against particularly in the work of inexperienced or opinionated reporters. But what happens when this sort of unprofessional work tops page one of The New York Times one day as a major “investigative” article and reemerges the next day in even more strident form as a major Times editorial? Are we dealing then with an inept journalist who got carried away with his thesis or are we facing institutional corruption or even a collective madness driven by ideological fervor?

What is stunning about the lede story in last Friday’s print edition of The New York Times is that it offers no real evidence to support its provocative claim that – as the headline states – “To Sway Vote, Russia Used Army of Fake Americans” or its subhead: “Flooding Twitter and Facebook, Impostors Helped Fuel Anger in Polarized U.S.” In the old days, this wildly speculative article, which spills over three pages, would have earned an F in a J-school class or gotten a rookie reporter a stern rebuke from a senior editor. But now such unprofessionalism is highlighted by The New York Times, which boasts that it is the standard-setter of American journalism, the nation’s “newspaper of record.” In this case, it allows reporter Scott Shane to introduce his thesis by citing some Internet accounts that apparently used fake identities, but he ties none of them to the Russian government.

Acting like he has minimal familiarity with the Internet – yes, a lot of people do use fake identities – Shane builds his case on the assumption that accounts that cited references to purloined Democratic emails must be somehow from an agent or a bot connected to the Kremlin. For instance, Shane cites the fake identity of “Melvin Redick,” who suggested on June 8, 2016, that people visit DCLeaks which, a few days earlier, had posted some emails from prominent Americans, which Shane states as fact – not allegation – were “stolen … by Russian hackers.” Shane then adds, also as flat fact, that “The site’s phony promoters were in the vanguard of a cyberarmy of counterfeit Facebook and Twitter accounts, a legion of Russian-controlled impostors whose operations are still being unraveled.”

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See my article yesterday.

Crisis Brings Sea Change To Greek Housing Market (K.)

“What we are experiencing is the end of the era of home ownership in Greece as households can no longer save to buy property,” says Nikos Hatzitsolis, chief executive at real estate firm CB Richard Ellis-Axies, underscoring the fundamental changes that the crisis has triggered in the Greek property market. This change, the experts explain, is not just evident in the case of those just flying the nest who wouldn’t be in any position to own their home anyway unless it was given to them by their family, but also existing homeowners who are opting to leave their property and rent it out or sell it. “Around 70% of homeowners are becoming renters because they choose to sell their property to pay off debts such as mortgages, late taxes or credit card debt,” says Lefteris Potamianos, vice president of the Athens-Attica Estate Agents Association.

“If any money is left over from the transaction, it is not reinvested in another property, as was the case in the past, but used to rent another home. Basically, the dream of ownership that drove past generations has come to an end.” A significant%age of homeowners choosing to rent out their home and lease a different property for themselves also consists of young people who see their accommodation requirements increasing, due to the birth of a child for example, or want to live in an area with better schools or security. “We are seeing more and more such cases in the property market,” says Potamianos. “Given that sales prices are very low and it is hard to find a buyer, many owners prefer to rent out their property and then rent another for themselves, as getting bank funding for a purchase is incredibly difficult. Some even move around to see which area suits them best. Renting has this flexibility, allowing you to relocate if you’re not happy.”

For the overwhelming majority, however, renting is the only option, as buying is seen as bringing no advantages whatsoever anymore. “Even from a purely economic perspective, it’s not worth owning a home today. In contrast, people who rent avoid all the additional tax costs and are not exposed to the instability of the tax framework for real estate assets, which has become a tool of politics and results in no taxpayer knowing what tomorrow will bring,” explains Hatzitsolis. “Previous generations believed that buying houses was a form of investment. This is no longer the case, as we’re seeing a completely different mentality in younger people.”

The expert also draws attention to the cases of people who are stuck with their properties. “I know an owner who inherited a house in [the upscale Athenian suburb of] Ekali and has to pay 80,000 euros a year in property tax,” he recounts. “At best, the house could fetch 50,000 euros a year in rent, which means that this man has to cover losses of 30,000 euros every year, something that is a complete dead end.” This owner has little choice but to sell, says Hatzitsolis, adding that such cases also explain why an increasing number of people are refusing their inheritances.

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Europe won’t rest until they have created their very own Somalia.

More Austerity May Be Ahead (K.)

Greek authorities will honor their commitments as laid out in the latest loan deal with international creditors, even if this results in the need for additional austerity measures next year, a top government official indicated Wednesday. In an unusual show of honesty and realism, the same official suggested that there might not be a “clean exit” for Greece after its third bailout expires next summer but something more restrictive. There are a range of possible scenarios between that of a clean exit, which Prime Minister Alexis Tsipras has heralded, and the prospect of a credit line for Greece, the official said. On the prospect of more austerity next year, the official said he believed that there would not be a big divergence in fiscal targets next year. “If there is, we’ll see what happens, but were are committed to a target of 3.5% of GDP,” the official said, referring to the primary surplus goal set by creditors.

The official also noted that, once a primary surplus target is reached, residual revenue will go toward boosting the Social Solidarity Income program for 2017 for Greeks who have been hardest hit by austerity but also toward paying off state debts to the private sector and to growth programs. Decisions on these matters are expected to be taken following talks with the mission chiefs representing Greece’s foreign lenders, who are expected to travel to Athens next month and to assess the progress of authorities in boosting tax collection and curbing spending. Although Greek officials have underlined the importance of completing the next bailout review by the end of the year, sources suggest that the process might drag into January.

The most important thing, the official noted, is “that we are not part of the problem” when important discussions about the future of the Greek program get under way in the first quarter of next year, touching on the participation (or not) of the IMF in Greece’s third bailout and relief for the country’s debt burden. Greek authorities are concerned about the IMF’s stance opposite Athens. Apart from the Fund’s traditionally tough position on fiscal matters, there are concerns too about its demands for a further recapitalization of Greek banks. The official, however, assumed the stance of the ECB on this issue, noting that there is no need for Greek banks to receive further capital. The official said that Greece planned to tap international bond markets in the next 6-9 months following a successful return in July.

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Jan 222017
 
 January 22, 2017  Posted by at 11:11 am Finance Tagged with: , , , , , , , , , ,  


Dorothea Lange Resettlement project, Bosque Farms, New Mexico 1935

The Inauguration, and the Counter-Inauguration (Atlantic)
White House Spokesman Slams Media In Bizarre First Briefing (ZH)
The Demons Have Been Unchained (HB)
How the NYT Plays with History (Robert Parry)
Any Country Leaving Euro Zone Must Settle Bill First: ECB’s Draghi (R.)
Trump Team in Talks with UK on Post-Brexit Trade Deal (BBG)
Utopian Ideas On Climate Change Will Get Us Precisely Nowhere (G.)

 

 

The Automatic Earth ‘celebrates’ its 9th birthday today! Thank you Nicole first of all, and thank all of you, so much, for reading, for commenting, being involved, for your kind donations. A true honor and pleasure.

(Someone had to point it out to me, of course I forgot.)

 

 

I’ve tried hard to understand what the women were/are protesting, and what I find is I’m still confused, since it seems they protest anything and everything. Or, as the Atlantic puts it: “the Women’s March was a protest that celebrated protest.” Looks to me like a surefire recipe for handing it to Trump on a platter.

Trump seems to be part of what’s being protested, but what exactly? His “grab the pussy” nonsense? But that was years ago and he was talking about willing women. Stupid and ugly, but it doesn’t make him a threat to all women. His abortion stance? Some of his supporters are pro-lifers for sure, but so far nothing indicates he’ll lead some big turnaround on the issue.

What I think everybody needs to recognize is that there are, and especially will be, very obvious and clearly definable topics linked to this administration that should be vigurously protested and investigated. But this protest doesn’t do any such thing.

Neither does the Democratic party, who can’t locate their own asses anymore. And most of all neither do the media, which for example covered nothing yesterday but a piece of absurd briefing theater about the number of people attending the inauguration. Once again handing the floor to Trump. It’s embarrassing.

Pointing out silly things Trump says that you know everyone in your respective echo chambers will agree with you on is easy, and Trump will keep feeding you. What it is not, though, is journalism. Or politics, for that matter. Or meaningful protest.

The role of Trump, I think, in America, must be that of a wake-up call. But nobody’s waking up.

The Inauguration, and the Counter-Inauguration (Atlantic)

In the middle of the National Mall, on the same spot that had, the day before, hosted the revelers who had come out for the inauguration of Donald Trump, a crowd of people protesting the new presidency spontaneously formed themselves into a circle. They grasped hands. They invited others in. “Join our circle!” one woman shouted, merrily, to a small group of passersby. They obliged. The expanse—a small spot of emptiness in a space otherwise teeming with people—got steadily larger, until it spanned nearly 100 feet across. If you happened to be flying directly above the Mall during the early afternoon of January 21, as the Women’s March on Washington was in full swing, you would have seen a throng of people—about half a million of them, according to the most recent estimates—punctuated, in the middle, by an ad-hoc little bullseye.

“What is this circle about?” a woman asked one of the circle-standers. “Nobody knows!” the circle-stander replied, cheerfully. The space stayed empty for a moment, as people clasped hands and looked around at each other with grins and “what-now?” expressions. And then: A woman ran through the circle, dancing, waving a sign that read “FREE MELANIA.” The crowd nodded approvingly. Another woman did the same with her sign. A group of three teenage boys danced with their “BAD HOMBRE” placards. The crowd whooped. Soon, several people were using the space as a stage. A woman dressed as a plush vulva shimmied around the circle’s perimeter. The circle-standers laughed and clapped and cheered. They held their phones in their air, taking pictures and videos. They cheered some more.

The Women’s March on Washington began in a similarly ad-hoc manner. The protest sprang to life as an errant idea posted to Facebook, right after Trump won the presidency. The notion weathered controversy to evolve into something that, on Saturday, was funereal in purpose but decidedly celebratory in tone. The march, in pretty much every way including the most literal, opposed the inaugural ceremony that had taken place the day before. On the one hand, it protested President Trump. Its participants wore not designer clothes, but jeans and sneakers and—the unofficial uniform of the event—pink knit caps with ears meant to evoke, and synonymize, cats. It had, in place of somber ritual, a festival-like atmosphere. It featured, instead of pomp and circumstance, people spontaneously breaking into dance on a spontaneously formed dance floor.

And yet in many ways, the march was also extremely similar to the inauguration whose infrastructure it had co-opted, symbolically and otherwise, for its own purposes. The Women’s March on Washington shared a setting—the Capitol, the Mall, the erstwhile inaugural parade route—with the ceremonies of January 20. And, following an election in which the victor lost the popular vote, the protest seems to have bested the inauguration itself in terms of (physical) public turnout. During a time of extreme partisanship and division—a time in which the One America the now-former president once spoke of can seem an ever-more-distant possibility—the Women’s March played out as a kind of alternate-reality inauguration: not necessarily of Hillary Clinton, but of the ideas and ideals her candidacy represented. The Women’s March was an installation ceremony of a sort—not of a new president, but of the political resistance to him.

“I DO NOT ACCEPT THIS FILTHY ROTTEN SYSTEM,” read one sign, carried by Lauren Grace, 35, of Philadelphia. She got the quote from Dorothy Day. And she intended it, Grace explained to me, to protest “a system that sort of left me out.” “We’re told that voting is a sacred right in this country,” Grace said. “But even though Hillary won the popular vote, she still lost. I feel pretty conflicted about a country where that could happen.”

The Women’s March was, to be sure, also a protest march in an extremely traditional vein: It featured leaders—celebrities, activists, celebrity activists—who gave speeches and offered performances on a stage with the Capitol in its background; its participants held signs, and chanted (“This-is-what-a-feminist-looks-like!,” “No-person-is-illegal!”), and commiserated. It was also traditional in that its participants were marching not for one specific thing, but for many related aspirations. Women’s reproductive rights. LGBTQ rights. Immigration rights. Feminism in general (“FEMALES ARE STRONG AS HELL,” one sign went, riffing off a famous feminist’s Netflix show). The environment (“CLIMATE CHANGE IS REAL,” “MAKE THE PLANET GREAT AGAIN”). Science (“Y’ALL NEED SCIENCE”). Facts (“MAKE AMERICA FACT-CHECK AGAIN”). Some signs argued for socialism. Some argued against plutocracy. Some argued for Kindness. Some pled for Peace. Some simply argued that America is Already Great.

This was a big-tent protest, in other words—a messy, joyful coalescence of many different movements. The Women’s March deftly employed, in its rhetoric, the biggest of the big-tent tautologies: The point of this protest wasn’t so much the specific things being protested as it was the very bigness of the crowds who were doing the protesting. This was another way the protest alternate-realitied the presidential inauguration: Just as the official ceremony is meant to celebrate not only the person occupying the presidency, but the presidency itself, the Women’s March was a protest that celebrated protest.

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Tyler Durden gets the essence: ..what he is seeing is that he once again is controlling the media narrative, which is focusing on a very immaterial and arbitrary issue, instead of spending time on investigative work and reporting on far more serious issues relating to Trump’s new administration.

White House Spokesman Slams Media In Bizarre First Briefing (ZH)

In a bizarre first briefing, White House press secretary Sean Spicer on Saturday unloaded a blistering attack on the media and accused it of false reporting about the otherwise irrelevant question of why Trump’s inauguration crowd was visibly smaller than that of Obama’s. Spicer used up virtually all the time in his first official appearance in the Press Briefing Room to denounce news organizations’ focus on the inaugural crowd size, saying “these attempts to lessen the enthusiasm of the inauguration are shameful and wrong.” We wouldn’t necessarily use those words: silly should suffice since if Trump really wanted to “defend” why fewer people attended his inauguration, he can simply say many more of his supporters are employed and had to be at work on Friday, than during either Obama’s 2009 or 2013 inauguration events.

However, the press secretary decided that hyperbole is the better part of valor and said “This was the largest audience to ever witness an inauguration, period, both in person and around the world” Spicer made the allegation despite photographs of the event clearly showed that the Mall was not full in the sections Spicer described, with dwindling-to-nonexistent crowds near the Smithsonian Institution Building and west toward the Washington Monument. There was also sparse attendance along the parade route from the Capitol to the White House. He alleged that some photos of the inauguration were “intentionally framed in a way” that minimized the crowd, without providing examples or evidence.

No official agency provides estimates of the size of gatherings on the Mall. But photos taken from the same vantage point at about the same time of day show that the crowds were far smaller than for President Barack Obama’s first inauguration, which Washington city officials estimated at 1.8 million people.Ultimately, the whole press briefing episode had a surreal undertone, one in which Trump, via his speaker, appears to continue to troll the press, now in the White House. As a seemingly perturbed NYU journalism professor Jay Rosen summarized it “Wow. Sean Spicer walked to the podium. Unloaded on the media for bias. Accused reporters of dishonesty. Walked off without taking questions.” The reaction among the rest of the press was similar.

Spicer took no questions from reporters and he did not say specifically how many people the White House believes attended the inauguration. He said three large sections of the Mall that each held at least 200,000 people were “full when the president took the oath of office.” Earlier on Saturday, in remarks at CIA headquarters in Langley, Trump said that from his vantage point at the podium, “it looked like a million, million and a half people. They showed a field where there were practically nobody standing there, and they said Donald Trump did not draw well.” Trump also said parts of the National Mall “all the way back to the Washington Monument” were “packed.”

Quoted by Bloomberg, former White House spokesman Ari Fleischer said on Twitter after Spicer’s remarks that “This is called a statement you’re told to make by the president. And you know the president is watching.” He is indeed, and what he is seeing is that he once again is controlling the media narrative, which is focusing on a very immaterial and arbitrary issue, instead of spending time on investigative work and reporting on far more serious issues relating to Trump’s new administration.

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The German press is just like the American one, clinging to consensus, hanging on to what is already lost: “Not only Democrats are hoping for an impeachment proceeding.”

The Demons Have Been Unchained (HB)

That was no presidential speech; that was a veritable declaration of war. Threatening in tone. Cold and calculating in logic. Change minus the hope. Donald Trump used the traditional Inauguration Day address to settle a score with the U.S. political establishment going back decades. With four ex-presidents sitting a few feet behind him, the 45th president delivered a populist manifesto. Until his victory, the nation’s political elite used days like these, he told America, to celebrate amongst themselves. Their triumph was not your triumph. Their well-being was not your well-being. But this time, power would transfer not just from one party to the other, but from Washington back to the people. In the people’s name, he will put America “first.” In their name, he will “take back” America’s factories.

In their name, he will “exterminate” Islamic terrorism, end inner-city drug gang “bloodbaths” and get NATO partners like Germany to pay more for Europe’s security. In domestic policy, the Trump agenda sounds like a blueprint for civil war; in foreign policy, it sounds like the dawn of a new ice age. Not that he’s cold-bloodedly planning either one, but he knows where his fiery rhetoric will lead him. The new president loves a good fight, not consensus. He doesn’t want to hug, but to smother, to overwhelm. Yesterday was his day, but the days that follow may belong to his opponents. There are three main opponents that could bring him down politically.

Opponent No. 1: The other America. Across the country, an anti-Trump movement is growing. While only 10,000 people came to an open-air concert in Washington celebrating his victory on the night before the inauguration, 20,000 people took to the streets in New York to protest his elevation. Their signs shouted: Not My President. The security and surveillance costs around Trump Tower on Fifth Avenue, at the corner of 56th Street, is costing taxpayers about a half million dollars – each day.

Opponent No. 2: The Media. Among publishers, producers, filmmakers and journalists, Trump has hardly any friends. CNN, The Washington Post, The New York Times and Hollywood couldn’t warm to the volcanic personality of the new president. Even an unbroken Twitter assault has no chance against such a monolithic wall of media rejection. He hates them, and they hate him right back. He pushes forward his agenda, and they push back unabashedly with theirs. Trump enters The White House with the lowest approval rating ever of an elected president.

Opponent No. 3: The Political Party System. Washington is having an allergic reaction to Trump. Democrats and even Republicans are cooperating on Capitol Hill to investigate the Trump team’s contacts to Russia in a special committee. House Speaker Paul Ryan doesn’t see himself as a Trump follower but as a Trump successor. He is the wolf in sheep’s clothing, biding his time, waiting for an opening. Put another way: Not only Democrats are hoping for an impeachment proceeding. America is now on the brink of a new period of polarization. The demons in this fraternal battle have been unchained. The greatness that Trump seeks will not be borne under these conditions. An icy wind is blowing across the land.

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Good overview by veteran Parry of late 20th century false news campaigns, Nixon vs Johnson, Reagan vs Carter and more.

How the NYT Plays with History (Robert Parry)

Whenever The New York Times or some other mainstream news outlet holds itself out as a paragon of professional journalism – by wagging a finger at some pro-Trump “fake news” or some Internet “conspiracy theory” – I cringe at the self-delusion and hypocrisy. No one hates fake news and fact-free conspiracy theories more than I do, but the sad truth is that the mainstream press has opened the door to such fantasies by losing the confidence of the American people and becoming little more than the mouthpiece for the Establishment, which spins its own self-serving narratives and tells its own lies. Rather than acting as a watchdog against these deceptions, the Times and its mainstream fellow-travelers have transformed themselves into little more than the Establishment’s apologists and propagandists.

If Iraq is the “enemy,” we are told wild tales about how Iraq’s non-existent WMD is a danger to us all. If Syria is in Washington’s crosshairs, we are given a one-sided account of what’s happening there, black hats for the “regime” and white hats for the “rebels”? If the State Department is backing a coup in Ukraine to oust an elected leader, we are regaled with tales of his corruption and how overthrowing a democratically chosen leader is somehow “democracy promotion.” Currently, we are getting uncritical stenography on every conceivable charge that the U.S. government lodges against Russia. Yet, while this crisis in American journalism has grown more severe in recent years, the pattern is not entirely new. It is reflected in how the mainstream media has missed many of the most significant news stories of modern history and has, more often than not, been an obstacle to getting at the truth.

Then, if the evidence finally becomes so overwhelming that continued denials are no longer tenable, the mainstream media tries to reclaim its tattered credibility by seizing on some new tidbit of evidence and declaring that all that went before were just rumors but now we can take the long whispered story seriously — because the Times says so.

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How long before Brussels starts begging countries to stay, offering deals and discounts?

Any Country Leaving Euro Zone Must Settle Bill First: ECB’s Draghi (R.)

Any country leaving the euro zone would need to settle its claims or debts with the bloc’s payments system before severing ties, ECB President Mario Draghi said. The comment – a rare reference by Draghi to the possibility of the currency zone losing members – came in a letter to two Italian lawmakers in the European Parliament released on Friday. It coincides with a groundswell of anti-euro sentiment in Italy and other euro zone states, fueled in part by last June’s unprecedented decision by Britain to leave the European Union. “If a country were to leave the Eurosystem, its national central bank’s claims on or liabilities to the ECB would need to be settled in full,” Draghi said in the letter.

Based on data to end-November from the Target 2 payment system, that would leave Italy with a €358.6 billion ($383.1 billion) bill. The system records flows of payments between euro zone countries. The threat of defaults on cross-border debts has often been credited as one element keeping the euro zone together throughout the financial crisis. As these payments are not generally settled, weaker economies including Italy, Spain and Greece have accumulated huge liabilities towards Target 2 while Germany stands out as the biggest creditor with net claims of €754.1 billion. Target 2 imbalances have worsened in recent months, with Harvard economist Carmen Reinhart warning of capital flight from Italy.

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Am I wrong in thinking the UK will have a very hard time signing any deal as long as it’s part of the EU? What are the odds of that even being legal in the first place?

Trump Team in Talks with UK on Post-Brexit Trade Deal (BBG)

The Trump administration this week will begin laying groundwork for a trade deal between the U.S. and the U.K. that would take effect after Britain leaves the European Union, a White House aide said. Prime Minister Theresa May last week declared Britain is “open for business” as she announced plans to pursue a clean break with the EU, paving the way for the U.K. to eventually strike new trade accords with the continent and other countries. May is to visit Washington this week. Trump officials believe their discussions with her government encouraged May to be more aggressive in exiting the union. She can use any American support to argue the U.K. will prosper outside the bloc although she risks inflaming tensions with EU leaders if they suspect her government is actively negotiating trade deals while still an EU member.

Two of President Donald Trump’s senior advisers, Steve Bannon and son-in-law Jared Kushner, met with U.K. Foreign Secretary Boris Johnson in New York on Jan. 8. The three are preparing for the future pact, the aide said, requesting anonymity because the discussions aren’t public. Bannon, Trump’s National Security Adviser Michael Flynn, and other administration officials have also met with British defense and intelligence leaders, the aide said. President Barack Obama warned in April that if the U.K. pursued Brexit, the country would go to the “back of the queue” for U.S. trade deals. U.K. voters chose to leave the EU anyway in a June referendum, and Trump now appears to be scrapping Obama’s position on the matter. Trump’s team is also considering a deal to reduce barriers between U.S. and British banks, the Sunday Telegraph reported, citing officials from both sides.

Trump has tapped Woody Johnson, the billionaire owner of the New York Jets NFL team, to serve as U.S. ambassador to the U.K., a person familiar with the matter said on Jan. 19. May and Mexican President Enrique Pena Nieto will make visits to the U.S. this month to meet with Trump, White House officials said. May will meet with Trump on Jan. 27, White House Deputy Press Secretary Sarah Huckabee said on Saturday. Pena Nieto will meet with Trump on Jan. 31, said White House Press Secretary Sean Spicer.

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The author starts out promising, then gets lost in the woods.

Utopian Ideas On Climate Change Will Get Us Precisely Nowhere (G.)

Urging people to stop consuming stuff in order to slow the rate of climate change is a gambit that is doomed to fail. It would be helpful if shoppers put off buying a suit or installing a new kitchen, but it’s not going to happen. Demonising those who fly to Barcelona for a long weekend is another tactic that will have almost no impact. It’s not for nothing that economists base many of their assumptions on populations having unlimited wants. Most people strain to acquire stuff that the rich have long taken for granted. Telling them to switch off this desire has never worked and is unlikely to do so now, even when the future of the planet is at stake. In this vein, the accession of Donald Trump to the presidential throne should not be read as a spectacular one-off reaction by a narrow, if electorally important group who missed out on GDP growth.

Consumption is how most people measure progress, and that will still be the case next year and in 10 years’ time, when Trump is long gone. Take a look at the figures for flights in and out of the UK, home of some the world’s busiest airports. City Airport, which is embarking on a £344m expansion, saw 4.3 million passengers in 2015. Heathrow, which has the government’s blessing for its own multibillion-pound development, welcomed 75 million passengers in the same year, Gatwick broke 40 million, and Stansted hit double-digit growth with 22.5 million passengers. Last year, Manchester airport boasted annual growth of 11% after it attracted 23.7 million passengers. And these figures don’t include the huge amount of imported and exported goods that flow through Britain’s airports.

If it’s true that trade is in the UK’s DNA – and the figures support this – any government, of whatever colour, will think twice before standing in the way of airport expansion. That doesn’t mean governments should not think about air travel when searching for ways to tackle climate change. Aircraft makers should be forced to make their planes more efficient, and airport owners must clean up the pollution they create. But this is an exercise in minimising the impact of flying, given that its expansion is inevitable. The same analysis should have applied to the country’s steel plants –and to its other polluting industries. Without a reduction in steel consumption, we must live with its continued production.

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