Feb 022019
 
 February 2, 2019  Posted by at 10:53 am Finance Tagged with: , , , , , , , , , , , , ,  


Pablo Picasso The bathers 1918

 

Russia Suspends INF Treaty In ‘Mirror Response’ To US – Putin (RT)
US Payrolls Surge By 304,000, Smashing Estimates Despite Shutdown (CNBC)
Big Trouble in Little China (Schmid)
How Fast Housing Markets in Sydney & Melbourne Are Coming Unglued (WS)
Venezuela To Sell Gold Reserves To UAE Without Russia’s Help (RT)
Italy Rejects Guaido, Says Venezuela is a Sovereign State (Telesur)
Whitehall Begins ‘Serious Work’ On Customs Union With EU (Ind.)
Judge Considers Gag Order On Roger Stone And Prosecution (BBC)
America’s Kurdish Allies Risk Being Wiped Out – By NATO (Graeber)
Rigging the Science of GMO Ecotoxicity (Latham)

 

 

US arms producers eye their ultimate bid for trillions in development fees. But Russia is not fazed at all.

“Let’s wait until our partners mature sufficiently to hold a level, meaningful conversation on this topic..”

Russia Suspends INF Treaty In ‘Mirror Response’ To US – Putin (RT)

President Vladimir Putin says Moscow is halting its participation in the Cold War-era INF nuclear agreement after Washington’s decision to suspend it. Russia will develop missiles previously forbidden under its terms. “Ours will be a mirror response. Our US partners say that they are ceasing their participation in the treaty, and we are doing the same,” the Russian president said in Moscow on Saturday in reference to the Intermediate-Range Nuclear Forces Treaty (INF). “They say that they are doing research and testing [on new weapons] and we will do the same thing,” Putin said during a meeting with Foreign Minister Sergey Lavrov and Defense Minister Sergey Shoigu.

The Russian leader emphasized that while Moscow’s offers on modernizing the 1987 treaty and making it more transparent “are still on the table,” no more talks should be initiated with the Americans to try and save it. “Let’s wait until our partners mature sufficiently to hold a level, meaningful conversation on this topic, which is extremely important for us, them, and the entire world,” Putin said. In December, the Trump administration threatened to quit the agreement, which limits nuclear and conventional land-launched missiles with a range between 500 and 5,500km within 60 days, unless Russia stopped allegedly violating it with its 9M729 missile, which Washington claims exceeds the permitted range.

Moscow denied that it had broken the treaty, and offered additional mutual inspections during failed talks in Geneva last month. On February 1, Washington officially confirmed that the bilateral agreement signed by Mikhail Gorbachev and Ronald Reagan will be suspended for 180 days. Washington also signaled intentions to entirely withdraw from it afterwards. During the meeting in front on the cameras on Saturday, Lavrov insisted that Moscow “attempted to do everything we could to rescue the treaty.” This included “unprecedented steps going far beyond our obligations,” he said, accusing Washington of systematically undermining the INF Treaty at least since the late 1990s.

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“December’s big initially reported gain of 312,000 was knocked all the way down to 222,000..”

US Payrolls Surge By 304,000, Smashing Estimates Despite Shutdown (CNBC)

Job growth in January shattered expectations, with nonfarm payrolls surging by 304,000 despite a partial government shutdown that was the longest in history, the Labor Department reported Friday. The unemployment rate ticked higher to 4 percent, a level where it had last been in June, a likely effect of the shutdown, according to the department. However, officials said federal workers generally were counted as employed during the period because they received pay during the survey week of Jan. 12. On balance, federal government employment actually rose by 1,000. Economists surveyed by Dow Jones had expected payrolls to rise by 170,000 and the unemployment rate to hold steady at 3.9 percent.

In all, it was a powerful performance at a time when economists increasingly have said they expect growth to slow in 2019. January marked 100 months in a row of positive job creation, by far the longest streak on record. Stock futures and Treasury yields jumped in response to the better-than-expected report. The news was not all good, though, as data revisions pushed previous numbers lower. December’s big initially reported gain of 312,000 was knocked all the way down to 222,000, while November’s rose from 176,000 to 196,000. On net, that took the two months down by 70,000, bringing the three-month average to 241,000. That’s still well above the trend that would be common this far into an economic expansion dating back 9 1/2 years.

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“Real GDP fell by 1.7 percent and 0.6 percent in Q3 and Q4 respectively compared with the official figures showing growth of 6.4 percent and 6 percent..”

Big Trouble in Little China (Schmid)

There are those who think “China will take over the world” with its technocratic central planning. Then there are those who say its debt bubble is so gigantic, the economy will crash and burn. The truth, probably, lies somewhere in the middle. And it looks like we are getting closer to know the truth. Official GDP growth, is of course on track at 6.6 percent for the year 2018, stellar among industrial and even emerging economies. But nobody believes these figures, even though they are the worst since 1990. “Real GDP fell by 1.7 percent and 0.6 percent in Q3 and Q4 respectively compared with the official figures showing growth of 6.4 percent and 6 percent,” Enodo Economics chief economist Diana Choyleva wrote in a note to clients about the annualized growth during the past two quarters of 2018. According to Choyleva, China is experiencing an unofficial recession.

While this doesn’t mean the crash and burn scenario is unavoidable, the flurry of official and unofficial economic indicators flashing red make the “take over the world” scenario quite unbelievable for the intermediate future. No matter which official indicator you look at, the Chinese economy is in decline. Retail sales growth is barely above 5 percent, the lowest level since 2003 with automobile sales crashing 13 percent. Total imports in U.S. dollar terms are down 7.6 percent in December of 2018 as compared to the year before.

The main problem of the Chinese economy is debt and overcapacity. Debt has blown up to 300 percent of GDP through the state-controlled banking system. The financing went into building trains, roads, airports, apartments, shipyards, anything that can be built. And while some of the stuff is undoubtedly useful, a lot of it is not. If it’s not useful or sustainable, it won’t generate the returns necessary to service said debt. This problem could have been nipped in the bud, but Chinese central planners wanted ever more steel mills and high speed trains and push back the day of reckoning when most of the unprofitable companies would go bankrupt. So in order to keep the gravy train running, more debt had to be issued to build more stuff.

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TEXT

How Fast Housing Markets in Sydney & Melbourne Are Coming Unglued (WS)

“Can we still describe this as an orderly slowdown in housing conditions?” mused CoreLogic Asia Pacific’s head of research Tim Lawless about the Australian housing market today. Over the last three months, the index for Sydney dropped 4.5%, and the index for Melbourne 4.0%, the “largest rolling quarterly fall since at least the 80’s.” Across the metro area of Sydney, prices of all types of homes combined, according to CoreLogic’s Daily Home Value Index, fell 1.35% in January from December, the third month in a row with a monthly decline of over 1%. The 4.5% decline over the past three months pencils out to an annual rate of decline of 17%. The index is now down about 12% from its peak in July 2017. Note the accelerating decline over the past three months:

The 12% drop from the peak in July 2017 pushed the index back where it been in July 2016 – which shows how crazy and unsustainable the price boom had been on the way up. Now it is getting unwound at a slightly slower pace on the way down. Over the 12-month period through January, the index fell 9.7%, with house prices down 10.9% and condo prices down 6.9%. At the same time, the number of homes of all types listed for sale in the Sydney metro jumped by 24%. [..] In the Melbourne metro, the second largest market in Australia, the housing bust is also taking on momentum, instead of slowing down, but started about four months behind Sydney’s. According to the CoreLogic Daily Home Value Index, since the peak in November 2017, prices of all types of homes fell about 9%, which pushed prices back to January 2017 levels. Note the acceleration over the past three months:

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US sanctions deprive Maduro of food and medicine. Seen as a way to create a revolt.

Venezuela To Sell Gold Reserves To UAE Without Russia’s Help (RT)

Caracas plans to sell 29 tons of gold to the United Arab Emirates in return for euro in cash, Reuters cites a senior government official as saying. The money is needed to provide liquidity for imports of basic goods.
According to the official, the sale of the nation’s gold began with the shipment of 3 tons on January 26, following the export last year of $900 million in unrefined gold to Turkey. The source denied Moscow’s involvement in the operation after rumors circulated this week that mysterious Russian-operated airplanes arrived in the country and planned to leave with Venezuelan gold on board. That is incorrect, according to the official. Caracas reportedly needs cash for imports of basic products that it sells to the population at subsidized prices.

A possible explanation for the payment for the gold in euros is US sanctions, which restrict Venezuela’s use of the dollar. Venezuela’s central bank reportedly began to sell gold reserves to allied countries after supplies of unrefined gold from small mines began to run low. The bank held 150 tons of gold in January 2018. By the end of November holdings had fallen to 132 tons between the central bank’s vaults and the Bank of England, according to central bank data. The Bank of England has refused to return an estimated 31 tons of Venezuelan gold worth $1.2 billion. Bankers in Britain are allegedly concerned that Venezuelan officials would sell state-owned gold “for personal gain.”

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“..this same mistake was made in Libya, and everyone today recognizes it. We must prevent the same thing happening in Venezuela.”

Italy Rejects Guaido, Says Venezuela is a Sovereign State (Telesur)

On Thursday the Italian Government withdrew from the position assumed by the European Parliament and informed that it does not recognize Juan Guaido as “president in charge” of Venezuela. “Italy does not recognize the self-proclaimed President Juan Guaido,” Italy’s Undersecretary of Foreign Affairs, Manlio Di Stefano, said. The senior official explained that Italy is “totally against” that a country or a group of countries “can determine the internal policies” of a sovereign State. “This is called the principle of non-intervention and is enshrined by the United Nations,” Di Stefano said. He also expressed the Italian Government’s concern to prevent a warlike confrontation in the South American nation and stressed that “this same mistake was made in Libya, and everyone today recognizes it. We must prevent the same thing happening in Venezuela.”

Last Wednesday the Italian Prime Minister, Giuseppe Conte, warned the international community that it is not “prudent” to support one of the opposing parties in Venezuela, since “an invasive attitude would generate more division in the world.” “We do not consider it opportune to rush to recognize investitures that have not gone through an electoral process,” said Conte. Nevertheless, violating international law, and adding to the U.S.-driven coup d’état, the European Parliament approved a resolution Thursday that recognizes Juan Guaido as Venezuela’s “interim president.”

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With just 56 days left, great moment to start.

Whitehall Begins ‘Serious Work’ On Customs Union With EU (Ind.)

Whitehall officials have begun “serious work” on the UK staying in a permanent EU customs union as a route to rescuing the Brexit deal, despite Theresa May ruling out the move, The Independent can reveal. Preparations are underway at a high level, amid a belief the beleaguered prime minister will be forced to offer the potentially crucial compromise to Labour. Ms May has repeatedly rejected a customs union – fearing a further revolt by anti-EU Tories – but some cabinet ministers are pushing her to accept that the red line will have to be dropped if her deal is to be rescued. They believe it could tempt scores of Labour MPs to back the deal when it returns to the Commons, even if Jeremy Corbyn himself still refuses to drop his opposition.

Now a well-placed Whitehall source has told The Independent: “There is serious work going on about a customs union. We need to be prepared, so we are ready if the politics moves in that direction.” Although the prime minister has not yet been won over, she will come under fierce pressure if, as expected, the EU rejects her plea to replace the backstop – before fresh Commons votes in just 12 days’ time. The concession of a customs union is unlikely to be enough to persuade Mr Corbyn to throw his weight what he is determined to brand “a Tory Brexit”, but many Labour MPs are expected to switch sides. Furthermore, despite inevitable Tory outrage, some Conservative MPs could be persuaded that a customs union would make it less likely the Irish backstop they oppose – designed to guarantee an open border – will ever be needed.

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“To storm my house with greater force than was used to take down (Osama) bin Laden or El Chapo or Pablo Escobar, to terrorise my wife and my dogs, is unconscionable..”

Judge Considers Gag Order On Roger Stone And Prosecution (BBC)

The judge overseeing the criminal case against ex-Trump campaign adviser Roger Stone says she is considering a gagging order on both him and the prosecution. Judge Amy Berman Jackson said the case was “a criminal proceeding and not a public relations campaign”. Mr Stone has been charged on seven counts by special counsel Robert Mueller, including witness tampering and lying to Congress. He denies any wrongdoing and has made frequent jibes against Mr Mueller. Mr Stone, 66, a longstanding ally of the president, has previously vowed to resist any gagging order, saying on Tuesday: “I will fight and the deep state is in panic mode.”

Mr Mueller is overseeing an investigation into alleged Russian meddling in the 2016 presidential election and whether Donald Trump’s campaign conspired with Moscow. President Trump denies collusion, calling the investigation “a witch hunt”, and the Kremlin denies any meddling. At a court hearing in Washington on Friday, Judge Jackson cited a number of “extrajudicial statements by the defendant”. She said that if a gagging order was imposed, Mr Stone would still be able to talk to the media about issues not connected to the case. She asked both sides to respond to the possible order by 8 February. The charges against Mr Stone are linked to an alleged Russian-led hack into the emails of Democratic Party officials. The information contained in the emails was released by Wikileaks during the 2016 campaign.

Since his arrest, Mr Stone has given a string of media interviews. He has been highly critical of his arrest, describing it as political theatrics. “To storm my house with greater force than was used to take down (Osama) bin Laden or El Chapo or Pablo Escobar, to terrorise my wife and my dogs, is unconscionable,” he told reporters. He has accused Mr Mueller of running a politically motivated “inquisition”. In an interview with Reuters, Mr Stone dismissed the charges as “process crimes” with no intentional lies. He said any failure to disclose emails or texts had been an “honest mistake”. In a phone interview with conspiracy theorist Alex Jones on his radio programme Infowars, Mr Stone said he intended to “fight for my life”.

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“This not only means they are supplied with state-of-the-art weaponry; it also means those weapons are being maintained by other Nato members. ”

America’s Kurdish Allies Risk Being Wiped Out – By NATO (Graeber)

Remember those plucky Kurdish forces who so heroically defended the Syrian city of Kobane from Isis? They risk being wiped out by Nato. The autonomous Kurdish region of Rojava in Northeast Syria, which includes Kobane, faces invasion. A Nato army is amassing on the border, marshaling all the overwhelming firepower and high-tech equipment that only the most advanced military forces can deploy. The commander in chief of those forces says he wants to return Rojava to its “rightful owners” who, he believes, are Arabs, not Kurds. Last spring, this leader made similar declarations about the westernmost Syrian Kurdish district of Afrin. Following that, the very same Nato army, using German tanks and British helicopter gunships, and backed by thousands of hardcore Islamist auxiliaries, overran the district.

According to Kurdish news agencies, the invasion led to over a 100,000 Kurdish civilians being driven out of Afrin entirely. They reportedly employed rape, torture and murder as systematic means of terror. That reign of terror continues to this day. And the commander and chief of this Nato army has suggested that he intends to do to the rest of North Syria what he did to Afrin. I am speaking, of course, of president Recep Tayyip Erdogan, who is, increasingly, Turkey’s effective dictator. But it’s crucial to emphasize that these are Nato forces. This not only means they are supplied with state-of-the-art weaponry; it also means those weapons are being maintained by other Nato members. Fighter jets, helicopter gunships, even Turkey’s German-supplied Panzer forces – they all degrade extremely quickly under combat conditions.

The people who continually inspect, maintain, repair, replace, and provide them with spare parts tend to be contractors working for American, British, German or Italian firms. Their presence is critical because the Turkish military advantage over Northern Syria’s “People’s Defense Forces” (YPG) and “Women’s Defense Forces” (YPJ), those defenders of Kobane that Turkey has pledged to destroy, is entirely dependent on them. That’s because, aside from its technological advantage, the Turkish army is a mess. Most of its best officers and even pilots have been in prison since the failed coup attempt in 2016, and it’s now being run by commanders chosen by political loyalty instead of competence. Rojava’s defenders, in contrast, are seasoned veterans. In a fair fight, they would have no more problem fending off a Turkish incursion than they had driving back Turkish-backed Jihadis in the past.

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Precautionary principle. The only response.

Rigging the Science of GMO Ecotoxicity (Latham)

Researchers who work on GMO crops are developing special “artificial diet systems”. The stated purpose of these new diets is to standardise the testing of the Cry toxins, often used in GMO crops, for their effects on non-target species. But a paper published last month in the journal Toxins implies a very different interpretation of their purpose. The new diets contain hidden ingredients that can mask Cry toxicity and allow them to pass undetected through toxicity tests on beneficial species like lacewings (Hilbeck et al., 2018). Thus the new diets will benefit GMO crop developers by letting new ones come to market quicker and more reliably. Tests conducted with the new diets are even being used to cast doubt on previous findings of ecotoxicological harm.

The resulting crops are usually called Bt crops. Cry toxins kill insects that eat the GMO crop because the toxin punches a hole in the membranes of the insect gut when it is ingested, causing the insect to immediately stop feeding and eventually die of septicaemia. Cry toxins are controversial. Although the biotech industry claims they have narrow specificity, and are therefore safe for all organisms except so-called ‘target’ organisms, plenty of researchers disagree. They suspect that Cry toxins may affect many non-target species, even including mammals and humans (e.g. Dolezel et al., 2011; Latham et al., 2017; Zdziarski, et al., 2018).

The Cry toxin mode of action, we and others have noted, does not necessarily discriminate between species. Any organism with a membrane-lined gut is, in principle, vulnerable if it consumes the GMO Bt crop. In these Bt crops the leaves, straw, roots, nectar, and pollen, all typically contain Cry toxins. Therefore, most organisms in agricultural landscapes will at some point in their life-cycle be exposed to GMO plant material. As pollinator declines and a more generalised insect apocalypse have revealed, the question of the effects of such crops on biodiversity is far from trivial.

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GMO Cry toxins
Cry toxins are a family of highly active protein toxins originally isolated from the gut pathogenic bacterium Bacillus thuringiensis (Latham et al., 2017). They confer insect-resistance and up to six distinct ones are added to GMO corn, cotton, and other crops (Hilbeck and Otto, 2015).

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Nov 042017
 
 November 4, 2017  Posted by at 9:27 am Finance Tagged with: , , , , , , , , ,  


Henri Cartier Bresson Shanghai 1947

 

Funny Facts Friday (David Stockman)
October Payrolls, Average Hourly Earnings Miss Big (ZH)
Record 95.4 Million Americans Not in Labor Force, 968,000 Exit In 1 Month (ZH)
Manafort Money Laundering Charge In Russia Probe May Face Challenges (R.)
Swamp-O-Rama (Jim Kunstler)
How Democrats Can Beat The Republican Tax Cut (Bartlett)
European Arrest Warrant Issued For Catalan Leader Carles Puigdemont (G.)
America’s Opioid Crisis Is About To Get Worse (ZH)
‘No Deal’ Brexit To Add £930 A Year To UK Shopping Bills (G.)
Stalked By Default Fears, Venezuela Calls Creditor Meeting (AFP)
The Greek Island Camp Where Only The Sick Or Pregnant Can Leave (G.)

 

 

“there has been no gain in employed prime age male workers during the entirety of this century!”

Funny Facts Friday (David Stockman)

The funny numbers came in a veritable torrent today. For instance, the so-called U-3 unemployment rate dropped to a 17-year low of 4.1% for October. Yet the same BLS household survey which posted the lowest unemployment rate since early 2000 showed that the number of employed Americans actually sank by 484,000 last month. How’s that? Well, easy as pie according to the data mavens at the BLS. It seems that the number of persons not in the labor force soared by 969,000 in October. So, yes, with a smaller numerator and an even smaller denominator they came up with a better – nay, awesome – unemployment rate. Then again, none of the talking heads on bubblevision even mentioned the staggering loss of 484,000 jobs during the month because they ignore the household survey’s job count entirely in favor of the establishment survey number (up 261,000) – even though the former drives the unemployment rate, which they crow about endlessly.

This cherry-picking of the data is quite understandable, however, when you consider what is really buried in the household survey and is completely ignored by the stock peddlers. To wit, not so awesome at all is the fact that during October there was an all-time record of 95.4 million persons not in the labor force and another 6.5 million that were jobless – meaning 102 million Americans (16 and older) don’t have jobs. That compares to 42 million retired workers on social security. Consequently, there are 60 million adult Americans who are housewives, students, disabled, food stamp and welfare recipients, social security dependents, dwellers in mom’s basement or denizens of the illegal drug, gambling or sex trades.

To be sure, we don’t have any special opinion on the merits of these pursuits, but we do have a point of view on the societal and fiscal math. Namely, the diminishing relative ranks of workers and tax mules in American society are going to buckle under the weight of baby boom retirements and soaring welfare and public sector health care costs in the years just ahead. In that context, one of the most striking numbers in today’s report is that 53.0 million prime age men 25 to 54 years old were employed in October, 2017. As is evident in the chart below, that is down by 1.5 million jobholders since the pre-crisis peak in May 2007 and virtually identical to the number in January 2001. Stated differently, there has been no gain in employed prime age male workers during the entirety of this century!

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“..on a monthly basis, there was no wage increase at all..”

October Payrolls, Average Hourly Earnings Miss Big (ZH)

Well, with virtually everyone expecting a 300K+ payrolls number after last month’s negative hurricane-distorted print, and with whispers of a 400K print floating around, it only made sense that not only would payrolls disppoint, printing at 261K, one standard deviation below the 310K consensus estimate (and that even with a whopping 89,000 waiters and bartenders added) .. but also that the far more important average hourly earnings number, which was expected to rise at a 2.7% rate Y/Y, also missed, printing at 2.4% instead with September revised lower to 2.8%. Worse, on a monthly basis, there was no wage increase at all, printing at 0.0% (technically it was a 1 cent decline), below the 0.2% expected, and the lowest since June 2015.

Average weekly earnings also disappointed, declining by 35 cents to $912.63, the first decline since May. It is also notable that after the September surge, the number of employed Americans per the Household Survey tumbled by 484K in October, to 153.961 million. That said, the real action this time was found in previous months, where September was revised higher from -33.000 to +18,000 while August was revised up from +169,000 to +208,000, for a total two month revision of +90,000. Additionally, the unemployment rate dropped to a new cycle low, declining from 4.2% to 4.1%, below the 4.2% expected, while the underemployment rate declined to 7.9%, the lowest since the start of the century.

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“..the civilian labor force shrunk by whopping 765,000 in one month.”

Record 95.4 Million Americans Not in Labor Force, 968,000 Exit In 1 Month (ZH)

In what was otherwise a mediocre jobs report, in which the establishment survey reported that a lower than expected 261K jobs were added to the post-Hurricane economy, the biggest surprise was not in the Establishment survey, but the household, where the unemployment rate tumbled once more, sliding to a new cycle low of 4.1%, for all the wrong reasons, because a quick look at the participation rate metrics showed that in October there was a sharp decline, with the labor force part. rate sliding from 63.1% to 62.7%, back to 4 decade lows…… driven by one disturbing metric: the number of people who exited the labor force soared by a near record 968,000 in October – the third highest on record – pushing the total number of people not in the labor force to a record 95.385 million, as the civilian labor force shrunk by whopping 765,000 in one month.

This took place as the number of employed Americans declined by 484,000, however since the unemployment rate denominator dropped more, it translated into an actual decline in the unemployment rate! So much for economist hopes that potential workers from the fringes are coming back to the labor force. Of course, the implication is even worse: with more slack being created in the form of workers who are leaving, not entering, the labor force, this creates a buffer for wage growth, and suggests that any hope for rapidly rising wages has once again been derailed.

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Not clear what they will be left with. FARA seems hard to prosecute.

Manafort Money Laundering Charge In Russia Probe May Face Challenges (R.)

When the lawyer for the former campaign manager of President Donald Trump attacked the money laundering charge brought against his client as flimsy, some legal experts say he may have pinpointed a potential weakness in the indictment by U.S. special counsel Robert Mueller. Paul Manafort and his associate Rick Gates both pleaded not guilty on Monday to charges that they failed to disclose they were lobbying for pro-Russia former Ukrainian President Viktor Yanukovich between 2006 and 2015 and laundered tens of millions of dollars by funneling the money through dozens of companies, partnerships and bank accounts.

In a court filing on Thursday, Manafort defense lawyer Kevin Downing said the money laundering count, the most serious facing his client with a 20-year maximum sentence, was based on a “tenuous legal theory” tying it to his failure to register as a foreign agent of the former Ukrainian leader. [..] The language of the filing and defiant statements Downing made outside the courthouse following Manafort’s arraignment on Monday suggest the lawyer is planning an aggressive defense of the charges, the first to be made public from Mueller’s probe into Russian interference in the 2016 presidential election. The Kremlin has denied meddling and Trump has said there was no collusion. Neither Trump nor his campaign was mentioned in the indictments issued on Monday.

Downing will also be seeking to suppress evidence he said was improperly obtained by search warrant, according to an additional filing on Friday. Manafort’s Virginia home was raided by FBI agents over the summer. The money laundering statute targets financial transactions involving the proceeds of “specified unlawful activity.” According to the Manafort indictment, the unlawful activity was his violation of the U.S. Foreign Agent Registration Act (FARA). Though the money laundering statute includes FARA violations, Seattle tax lawyer John Colvin said the charge against Manafort was not as straightforward as most other cases. “It doesn’t fit the normal paradigm” of money-laundering cases involving criminal activity like drug trafficking, Colvin said. “It seems like a stretch to me.”

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“Are there any like me out there who would like to see both parties tossed onto the garbage barge of history?”

Swamp-O-Rama (Jim Kunstler)

Now comes the news from Donna Brazille, on-again-off-again Democrat Party chair, that the primary elections were elaborately rigged by HRC functionaries to buy control of her nomination. Let’s not even go into the bidding for the Christopher Steele “dossier” alleging kinky sexual romps in Moscow by Donald Trump, or the activities in Ukraine of Tony Podesta’s DC lobbying company — that’s Tony, brother of John Podesta, Clinton campaign chief, whose emails remain a truffle cache for the rooting dogs of the DOJ, if they were actually on-the-task. I write this as a still-registered Democrat myself — though I consider myself their enemy now, yet hardly a Trump partisan. Are there any like me out there who would like to see both parties tossed onto the garbage barge of history?

Of course, to say that also means throwing out a cargo of terrible ideas and beliefs, not just two clown cars of personalities. Identity politics, zero interest rate policy, American Exceptionalism, endless debt, nation-building in foreign lands, FASB-157, sanctuary cities, Title IX coercion, racketeering in health care and higher ed, market interventions, ambiguous borders… is just some of the cargo that needs to be dumped overboard with both parties. Watergate begins to look as quaint and simple as a game of Chutes and Ladders compared to RussiaGate. Not only are both parties implicated one way or another in multiple nefarious schemes, plots, and intrigues, but the Department of Justice and its subsidiary, the FBI, look culpable in a range of cover-ups and mis-directions. If the DOJ becomes disabled, how does any of this get resolved?

The whole extravaganza is heading toward a constitutional crisis that might clean out the system like a Death Wish coffee enema. Sentiment may arise for Mr. Mueller to step aside, if President Trump doesn’t make the rash decision to simply fire him. The latter would certainly foment a constitutional crisis that could include an effort to run Trump over with the 25th amendment. In the event, we’ll be in a new kind of civil war.

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New deal.

How Democrats Can Beat The Republican Tax Cut (Bartlett)

To get back on offense, I think Democrats should stop trying to compete with Republicans on more distributionally fair tax cuts. When you can’t win, don’t play the game. Instead, they should say, if Republicans are willing to increase the deficit by $1.5 trillion, let’s use that money for something the country really needs that will create a vastly greater number of jobs. That is a giant infrastructure program. There is no need to detail the myriad of ways that the money could be spent without coming close to exhausting the available projects. Roads, bridges, schools, hurricane repair projects, sea walls and such to protect against future climate catastrophes, the power grid and many, many more. Civil engineers periodically publish long lists of urgent infrastructure needs.

Not only would a big infrastructure program be capital that will pay off for decades, just as Republican Dwight Eisenhower’s national highway program did, but it will create vastly more jobs than any kind of tax cut, especially the one Republicans are proposing that would largely benefit the wealthy while providing no incentives for job creation or investment. The Congressional Budget Office has long provided estimates to Congress showing that direct spending by government on infrastructure has a much more powerful effect on economic growth than any type of tax cut. A February 2015 report showed that purchases of goods and services by the federal government would raise GDP by as much as $2.50 for every $1 spent. Grants to state and local government for infrastructure could create as much as $2.20 for every $1 spent.

By contrast, according to the same report, a temporary tax cut for the wealthy, such as Republicans propose today, would create at most 60 cents of GDP for every $1 of foregone revenue. A tax cut for the middle class is much better, creating as much as $1.50 of GDP for every $1 of revenue loss. Corporate tax cuts are the worst, creating at most 40 cents of GDP for every $1 of revenue loss. Some may say that these estimates are high, given that we are close to full employment, according to many economists. But the additional stimulus would draw many discouraged workers back into the labor force, especially if it created upward pressure on wages, which workers desperately need. Higher wages will raise consumer spending that will further increase growth.

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This is going spectacularly off the rails. Brussels can no longer insist it’s a domestic Spanish issue. Because Puidgemont is in …. Brussels.

European Arrest Warrant Issued For Catalan Leader Carles Puigdemont (G.)

A Spanish judge has issued an international arrest warrant for Catalonia’s ousted president a day after she jailed eight members of the region’s separatist government pending possible charges over last week’s declaration of independence. In the latest twist in Spain’s worst political crisis in four decades, a national court judge on Friday issued a European arrest warrant for Carles Puigdemont in response to a request from state prosecutors. Puigdemont flew to Brussels earlier this week with a handful of his deposed ministers after Spanish authorities removed him and his cabinet from office for pushing ahead with the declaration despite repeated warnings that it was illegal. Puigdemont’s Belgian lawyer has already said his client will fight extradition without seeking political asylum.

Puigdemont was summoned to appear at Spain’s national court on Thursday to give evidence relating to possible charges of sedition, rebellion and misuse of public funds, but failed to appear. He has said he would only return to Spain if he were offered guarantees that the judicial process he would face were fair. Late on Friday, Puigdemont told the Belgian public TV channel RTBF that he would put his faith in the Belgian courts. He said: “I will not flee from justice. I will go towards justice, but real justice. I’ve told my lawyers to tell the Belgian justice system that I’m completely available to cooperate. “It’s obvious it’s politicised. The guarantees are not there for a fair, independent trial.”

It was Puigdemont first interview since arriving in Brussels on Monday and it he claimed there was “enormous influence of politics over the judiciary in Spain”. He said: “It’s not normal that we risk 30 years in prison, it’s extremely barbaric, we can not talk about democracy.” Puigdemont said he was ready to stand in the election, adding: “It’s possible to run a campaign from anywhere. We consider ourselves a legitimate government. “There must be a continuity to tell the world what’s going on in Spain … It’s not with a government in jail that the elections will be neutral, independent, normal.”

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Better make it a national emergency right now.

America’s Opioid Crisis Is About To Get Worse (ZH)

The simple chart below from the United Nation’s Office on Drugs and Crime beautifully illustrates the next leg up in America’s opioid crisis. If you thought today’s situation was bad – think again. Afghanistan, the world’s largest producer of opium just logged a record crop harvest this year doubling last year’s production. Some how – some way, Afghanistan’s opium will find its way into a neighborhood near you. According to VOANEWS, Last year, poppies were cultivated on 201,000 hectares, yielding 4,700 tons of opium, up 46% from 2015. Sources told VOA’s Pashto service more than 10,000 tons of opium were produced this year. Opium then can be refined into heroin. The U.N. Office on Drugs and Crime estimated that opium accounted for some 16% of the country’s GDP last year, including more than two-thirds of the entire agricultural sector. In addition to fueling insecurity, violence and insurgency, the drug production is discouraging private and public investment, a UNODC report said.

This is a bad sign for President Trump who opted to call the opioid crisis a ‘public emergency’ rather than a full-blown ‘national emergency’. Highlights from Trump’s opioid crisis speech: In 2016, more than two million Americans had an addiction to prescription or illicit opioids. Since 2000, over 300,000 Americans have died from overdoses involving opioids. Drug overdoses are now the leading cause of injury death in the United States, outnumbering both traffic crashes and gun-related deaths. In 2015, there were 52,404 drug overdose deaths — 33,091 of those deaths, almost two-thirds, involved the use of opioids. The situation has only gotten worse, with drug overdose deaths in 2016 expected to exceed 64,000. This represents a rate of 175 deaths a day.

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What happens when you transfer your food production abroad. Look, Cuba and Russia used it to their advantage.

‘No Deal’ Brexit To Add £930 A Year To UK Shopping Bills (G.)

Households face increases of up to £930 in their annual shopping bills if Britain walks away from Brexit talks without a trade deal, according to new research that reveals a disproportionate impact on poorer families and the unemployed. Meat, vegetables, dairy products, clothing and footwear would be subject to the largest consumer price rises under a “no-deal” scenario, according to a study published in the authoritative National Institute Economic Review, adding to inflationary pressures that have already forced the first interest rate rise in a decade this week. Stalled negotiations resume next week in Brussels, but the government is also about to publish a trade bill that would result in Britain being required to apply swingeing new tariffs on European imports if it falls back on World Trade Organisation rules.

Since WTO tariffs are highest for fresh food – reaching 45% for dairy products and 37% for meat – and much of this is currently imported from Europe, the team of economists predict an inflationary surge that could match that already inflicted by the falling pound. This would impact most on those least able to afford it, as poorer households typically spend a much higher proportion of their income on food and other essentials. For the 2m worst-affected households, the study predicts their weekly expenditure will rise by 2-4.7%, equivalent to £400-930 extra a year. “The overall increase in price in the affected goods is estimated to be 2.7% and this translates into an increase in the overall cost of living of 0.8-1.1% for a typical family, with the unemployed and families, those with children and pensioners hit hardest,” conclude the economists from the University of Sussex and Resolution Foundation.

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America takes revenge on Chavez.

Stalked By Default Fears, Venezuela Calls Creditor Meeting (AFP)

Venezuela on Friday called foreign creditors to a November 13 meeting in Caracas aiming to restructure its estimated $150 billion debt, as credit-rating agencies dealt the crisis-stricken country another blow with double downgrades. Standard & Poor’s cut the nation’s long-term foreign currency rating to “CC” from “CCC-” over growing concerns of the risk of a debt default in the oil-producing country, while fellow agency Fitch cut the long-term debt rating to “C” from “CC.” The increasingly dire warnings followed President Nicolas Maduro’s calls to “investors across the whole world and to holders of Venezuelan debt” to attend a Caracas meeting November 13 “to start a process to refinance and renegotiate the external debt.”

His vice president, Tareck El Aissami, who is leading a commission tasked with the restructuring, said the government is seeking “sovereign commitments” for a debt renegotiation. Flanked by the ministers in charge of the economy, finance and energy, El Aissami confirmed the country had on Friday started to pay out $1.2 billion due to service the debt of state oil company PDVSA. Maduro announced Thursday that Venezuela would begin talks to refinance the debt immediately after that payment was made. El Aissami, one of the Venezuelan officials sanctioned by the United States due to alleged ties to drug trafficking, said the talks with creditors will “establish the groundwork to renegotiate the terms of the foreign debt of the Republic and of PDVSA.”

“We will begin a sovereign renegotiation of our debt and we will continue to comply fully, transparently, as our government has done historically,” he said in a televised statement. He noted that since 2014 Venezuela, which has the largest proven crude oil reserves in the world, has paid nearly $72 billion in principal and interest payments on the debt. Maduro has repeatedly blamed the United States for the country’s woes, saying Washington is trying to strangle Venezuela with sanctions. US sanctions imposed on Venezuela in August ban US trade in any new bonds issued by the Venezuelan government or PDVSA — a needed step in any restructuring. El Aissami denounced the “continued aggression, permanent sabotage, blockade and financial persecution” he said US President Donald Trump has imposed on the people of Venezuela.

But he said the sanctions really hurt bondholders and financial institutions. Much of Venezuela’s debt is held by China and Russia, to be paid off in oil – the resource that underpins the Venezuelan economy. The country has less than $10 billion in foreign currency reserves. Analysts were pessimistic about Venezuela’s chances of successfully restructuring its debt. “Venezuela’s options to keep up with its payments are shrinking rapidly, mainly because any restructuring needs to be matched with clear and credible economic reforms capable of winning the trust and support of bond-holders,” said Diego Moya-Ocampos, an analyst at London-based IHS Markit.

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People will make themselves sick, self harm, just to get off the islands.

The Greek Island Camp Where Only The Sick Or Pregnant Can Leave (G.)

Eida was two months pregnant when she suffered a miscarriage. A month later, the 18-year-old Syrian refugee still feels angry and despondent. Not just that she lost a child. But that being pregnant was her ticket off the Greek island of Samos – and out of a squalid, barren, barb-wired camp. The young woman is one of around 3,000 refugees in Samos, one of the five Greek “hotspot” islands in the eastern Aegean Sea, designated by the EU to act as a barricade against massive irregular migrant arrivals from Turkey. Since March 2016, when Brussels concluded a controversial agreement with Ankara to curb migrant flows, only vulnerable cases are transferred from the hotspots to the Greek mainland. Eida had hoped to become one of those cases.

The rest are left with two options: languish under deplorable conditions in the camps until their asylum claims are examined, or pay local smuggling networks €1,000 or more to get ferried to the mainland. Anastasia Theodoridou, head of social services at Samos state hospital, says she routinely deals with cases like Eida’s. “Dozens of women come to the hospital desperate to find out they are pregnant. Other refugees are eager for a diagnosis of any serious condition. And if there is nothing wrong with them, they bring their spouses and children. Maybe one of them might have a chance of a diagnosis.” According to internal documents, the Samos hospital has handled 7,857 visits by refugees since the start of the year.

The grotesque paradox of refugees hoping to be ill to get favourable treatment casts a shadow on the EU’s narrative about the success of its response to the refugee crisis.The rosy outlook from Brussels is often based on statistics that show a sharp reduction in irregular daily crossings and deaths in the Aegean. This in turn has resulted in a broad desertion of the tragedy by the international community: journalists have long since gone home, NGOs are packing up, volunteers are few and far between and official funding has been reduced. But despite substantial EU support to Athens – €430m has been contracted according to the European commission – conditions at the Greek hotspots remain appalling. With the focus now shifting to refugees crossing the sea from Libya, Tunisia or Algeria, the situation here is still no less dramatic than a year ago. It is still a massive crisis, albeit a somewhat forgotten one.

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