Aug 032019
 
 August 3, 2019  Posted by at 9:26 am Finance Tagged with: , , , , , , , , , ,  


Dorothea Lange Migrant Father June 1938

 

Russian Assets In America: A Field Guide (RT)
Majority of House Democrats Favor Starting Impeachment Proceedings (R.)
The Rise and Fall of Superhero Robert Mueller (Matt Taibbi)
Obama Looms over the Primary in Invisible Ways (TPM)
Race Hustle (Jim Kunstler)
Tory Rebels Threaten Boris Johnson After Majority Cut To One (G.)
Watch Out Boris Johnson the Chickens are Coming Home to Roost (English)
Pentagon Testing Mass Surveillance Balloons Across The US (G.)
What Would Chinese Military Intervention In Hong Kong Look Like? (ZH)
First Human-Monkey Chimera Raises Concern Among Scientists (G.)

 

 

Russiagate intensifies.

Honorable mentions: Trump, hamburgers, Washington Post.

Russian Assets In America: A Field Guide (RT)

If the mainstream media is to be believed, the Kremlin’s network of hackers and bots could give the Illuminati a run for its money. When its operatives aren’t electing British prime ministers, embarrassing American politicians on debate night and flogging dildos to undermine democracy, they’re overseeing a team of assets earning their borscht openly in the United States. Thankfully, the intrepid detectives in the American press have named and shamed these double agents. We’ve compiled a list here.


Mitch McConnell, alias: Moscow Mitch McTreason

Cleverly posing as a Republican Senator from Kentucky since 1985, Mitch McConnell was outed as a Russian asset by the Washington Post last week when he shot down a trio of bills that would have supposedly beefed up American election security from foreign interference. Never mind that McConnell opposed the bills based almost entirely on partisan disagreements with the Democrats, the Post exclaimed “Mitch McConnell is a Russian asset,” and MSNBC’s Joe Scarborough dubbed the southern Republican “Moscow Mitch.” With his nefarious plan exposed, #MoscowMitchMcTreason had no choice but to shrug, and continue about his day.


Lindsey Graham, alias: Leningrad Lindsey

#LeningradLindsey began trending after the South Carolina lawmaker helped push a controversial asylum bill through the Senate Judiciary Committee on Thursday. Though the bill had nothing to do with Russia, the nickname stuck. Cleverly, Leningrad Lindsey has spent his career on Capitol Hill posing as a Russia-baiter. Graham has repeatedly called for Russia to “pay a price” for allegedly meddling in the 2016 presidential election, and co-sponsored an anti-Russia “sanctions bill from hell.” With a record like that, nobody would suspect that he was secretly a Russian asset all along. Note too that Leningrad does not exist any more. Perhaps Graham’s treachery dates back to the communist era? Either that or Letnerechenskiy Lindsey didn’t have the same ring to it.

Read more …

I can’t seem to figure out on what specific grounds though.

Majority of House Democrats Favor Starting Impeachment Proceedings (R.)

A majority of Democrats in the U.S. House of Representatives now favor launching impeachment proceedings against Republican President Donald Trump, after a California lawmaker on Friday became the 118th Democrat to call for the process to begin. “In the past few years, our nation has seen and heard things from this president that have no place in our democracy,” Representative Salud Carbajal said in a statement that accused Trump of “criminal” behavior. “I believe it is time to open an impeachment inquiry into President Donald Trump,” Carbajal said. The Democrats have a majority of 235 members in the House of Representatives. Support for an impeachment inquiry has jumped by more than two dozen Democrats since former Special Counsel Robert Mueller testified on July 24 about his probe of Trump and Russian interference in the 2016 election.

But the total of 118 is still far short of the 218 House votes needed to approve an impeachment resolution, and opinion polls continue to show voters sharply divided over the issue. The House is currently on a summer recess and will not return until Sept. 9. Having a majority of her own caucus favor impeachment could put new pressure on House Speaker Nancy Pelosi, who opposes impeachment as a politically risky move unless investigators find powerful evidence of misconduct by Trump that can unify public opinion. In a statement issued Friday, Pelosi gave no sign she was about to change her cautious approach. Instead, she outlined in considerable detail her strategy of Democrats continuing to investigate the president, while also moving in court to get access to more evidence.

“Democrats in the Congress continue to legislate, investigate and litigate,” Pelosi declared. “The president will be held accountable.” Democrats opposing impeachment say the best way to remove Trump is by defeating him in 2020, when he is up for re-election. Some Democrats worry that too strong a focus on impeachment could eclipse other issues like healthcare and threaten the re-election of Democrats who pried seats away from Republicans last year in regions where many voters oppose impeachment. Trump has denied any wrongdoing and says he was vindicated by the Mueller report, but the special counsel made clear in his testimony to Congress that that was not the case.

In his report, Mueller described in detail the extensive contact Trump’s team had with Russia during the 2016 election campaign, and how Trump tried to impede Mueller’s investigation. While he stopped short of concluding Trump had committed a crime or that his aides had conspired with Moscow, Mueller did not clear him and indicated it was up to Congress to decide the next steps. Democrats on the House Judiciary Committee effectively rebranded their six-month-old oversight investigation of Trump as an impeachment probe last week, when they asked a federal judge for access to Mueller’s grand jury evidence to determine whether to recommend articles of impeachment against Trump.

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More impeachment nonsense.

The Rise and Fall of Superhero Robert Mueller (Matt Taibbi)

The conspiracy tale has validated every Trump criticism about both crooked media and the deep state. The whole narrative is the brainchild of Clinton hacks, a handful of overzealous intelligence nuts, and a subset of the Democratic Party’s weakest elected minds, in particular murine ex-prosecutor Schiff, a man who should be selling Buicks back in his hometown Burbank. Take a good look at Schiff, at our paranoid outpatient of an ex-CIA chief John Brennan, and at excuse-making Clinton campaign chief Robby Mook (a.k.a. the captain of the Democratic Titanic), and ask if you really want to be re-writing history for those people. They’re making the press accomplices in the most imbecilic effort at political opposition in recent American history.

Hence the desperate public comments and the string of wacked-out stunts, like putting Mueller under oath. Impeachment will be the next adventure in doubling down blind. A significant portion of the original conspiracy theory vanished via a series of under-circulated news reports just in the months since the end of the Mueller probe. Remember the Southern District of New York campaign finance probe that arose in connection with Trump lawyer Michael Cohen, the one described as a “major danger” to Trump? Remember all that talk about how “Trump can’t run the Mueller playbook on the New York feds?” Experts told us that the Cohen probe posed a “significant threat” of new indictments for Trump and his family.

When that investigation closed with no new charges the same week Mueller testified, the commentariat barely noticed. Same with the Democrats v. Earth lawsuit/publicity stunt, in which the Democratic National Committee sued Trump, the Russian government, and Wikileaks under a RICO claim. Plaintiffs charged the Trump campaign conspired to steal and release DNC emails. But a federal judge tossed the suit on the grounds that the Trump campaign “did not participate in the theft.” Moreover, the Clinton-appointed judge said published documents were “of public concern” and therefore protected like any other journalistic work product. The judge also ruled that allegations about all the non-Russian defendants (including Wikileaks) were “insufficient to hold them liable” for any illegality involved in obtaining DNC emails.

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More superheroes.

Obama Looms over the Primary in Invisible Ways (TPM)

When Bernie Sanders got into the race in 2016 in many ways his campaign was premised on the idea that Obama had gotten most things wrong. Perhaps his presidency wasn’t a disaster, as my friend argues. But the premises of Sanders’ campaign was that Democrats needed to move in a dramatically different direction and that Obama’s policies and presidency were – while better than the GOP alternative – fundamentally misguided. Sanders was pretty straightforward about this before getting into the race. And he didn’t really hide it once he got in. But in the nature of things, since Obama was a popular incumbent, it wasn’t a point he emphasized during his campaign.

We also know that the entire country has moved left on a number of issues over the last decade (LGBTQ issues and marijuana legalization are just two examples). Democrats, meanwhile, have moved significantly to the left on a much broader range of issues. Some of this is an on-going trend. Some of it is in reaction to Trump, having his extremity lead to a reevaluation of practices that most Democrats didn’t focus much on. Maybe the best example of this is on immigration. As immigration advocates were saying very clearly at the time, the Obama administration deported lots and lots of people. It’s hard to see that in quite the same light after what we’ve all been exposed to about the mechanics of ICE, detention, deportation and everything that goes with it.

But with all of this, there’s a shift that has taken place that manages to be both all but invisible and yet very obvious. Part of it is Sanders deep imprint on the 2020 policy conversation – especially on health care and student debt but on other issues as well. Part of it is the wave of left activism that predates Trump but has intensified under his presidency. But taken together they’ve created a 2020 campaign policy conversation which at least implicitly gives a pretty negative verdict on Obama and his presidency. Perhaps not a disaster as my friend puts it but in many regards a mistake rather than something to build on. That, I think, is the root of Biden’s continuing strength, even with all the bobbles, flubs, the archaic policy histories and all the rest. It’s not just because he was Obama’s Vice President and people like Obama. It’s because the terms of the policy debate are in conflict – when forced together – with where the great majority of Democrats are, which is holding Obama and his presidency in very high regard.

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“Maybe the Democratic Party should move out of the ghetto it’s built for itself.”

Race Hustle (Jim Kunstler)

The shriekings of “racism” aren’t helping much anymore. Few observers have missed the fact that the city of Baltimore has been run by an African American city hall (Mayor, Police Chief, District Attorney) for many years, with over a billion dollars in additional federal assistance. So, if political power is the answer, how’s that working out? Add some extra shrieking about “white privilege” to explain the situation? How does “white privilege” explain the fact that 86 percent of kids in Baltimore primary schools can’t read and 89 percent can’t do arithmetic to grade level? This, despite the fact that at $15,564 per pupil, Baltimore is fourth highest per student of the 100 largest school districts in the nation, according to the U.S. Census Bureau.

Maybe becoming the party of a national race hustle isn’t such a good idea. The race hustle is wearing out its welcome in American politics, and the more the Democratic Party resorts to race hustling as its chief strategy, the sooner the party will go extinct. That is, if it doesn’t incite some kind of civil war first. Cue the cry, “That’s racist!”

Maybe there is a whole range of human values and human behaviors that have nothing to do with race — like reading to small children and helping them learn the English language so they don’t grow into adults who have to say “know what I mean?” every other sentence because they’ve barely acquired enough language skill themselves to know what they mean. Maybe there’s something called an American common culture that contains values and behaviors worth emulating rather than opposing. Maybe “multiculturalism” wasn’t such a good idea after all. Maybe ghetto culture is not such a precious foundation for a successful life. Maybe the Democratic Party should move out of the ghetto it’s built for itself.

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‘Even if my career is over, I can’t put my name to this.’

Tory Rebels Threaten Boris Johnson After Majority Cut To One (G.)

Boris Johnson faced a grave threat to his control of parliament on Friday as he was warned that Conservative rebels could cross the House of Commons to foil Brexit in the aftermath of a byelection that reduced his working majority to just one MP. Overnight, the Liberal Democrats’ Jane Dodds won a crucial byelection in Brecon and Radnorshire by a margin of 1,425, overturning the Tories’ previous majority of more than 8,000. The result prompted immediate recriminations across the party. Conservative no-deal sceptics warned about the rapidly growing threat the government could face from the reinvigorated Lib Dems, while insiders blamed Theresa May’s administration for choosing a candidate who had already been ousted for expenses fraud.

One of the most prominent Conservative supporters of a second referendum told the Guardian on Friday he was actively considering defecting to the Lib Dems or sitting as an independent, a move that would leave Johnson at the helm of a minority government. Dr Phillip Lee, the former justice minister, who first suggested he could quit the party in his own podcast, On the House, told the Guardian he was not alone among colleagues considering defecting or resigning if the government pursued no deal. “I have things to think about over the summer, but it is not just me,” he said.

“There are a number of colleagues who are spending the summer reflecting on what is the right way for them to confront this no-deal scenario. Of course, it is difficult for all of us because we joined the Conservative party, but it has morphed into something a lot different to what I joined in 1992.” Although Johnson might be able to rely on Labour Brexiters and independents to vote for a deal, Lee suggested that the government could still be threatened by the many Conservatives in the party’s centre who had been alienated by the number of rightwingers in Johnson’s cabinet. “At the moment Boris Johnson has a very difficult pitch to play and that has been made even harder by the formation of this cabinet,” he said. “There are increasingly people who think, ‘Even if my career is over, I can’t put my name to this.’

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“[..] the pound has plummeted since his appointment. It is currently the second worst performing currency in the world – after the Madagascan Ariary.”

Watch Out Boris Johnson the Chickens are Coming Home to Roost (English)

[..] a week is a long time in politics and Prime Minister Johnson quickly ran out of hot air. Just saying stuff will happen does not make stuff happen. You can’t strike a better deal if you refuse point blank to meet your opposite numbers. You see, incredibly, instead of setting up meetings with his fellow heads of state and selling his Brexit vision, Johnson has declared that he won’t meet Angela Merkel, Emmanuel Macron or any of the EU heads unless they scrap the backstop. This is the same ludicrous negotiating tactic he deployed when as Mayor of London he refused to engage with London Underground union reps. It didn’t work then and led to long strikes. It’s even less likely to work now – and the end result will be far more damaging.

Johnson is all about image and image management. His team has already set to work on a £100 million taxpayer-funded propaganda campaign – the biggest of its kind since World War Two – to convince the British people that a ‘no deal’ Brexit will be fine and, failing that, it will be everyone else’s fault. Every single reputable economist disagrees. And so do the markets, which is why the pound has plummeted since his appointment. It is currently the second worst performing currency in the world – after the Madagascan Ariary.

Some Brexit cultists argue that a weak currency is good for the economy. They’re wrong. Unless you’re a hedge fund manager or a holiday lettings firm in Cornwall, a weak pound is a disaster. It’s bad for consumers and calamitous for manufacturers relying on tight margins and supply chains. It’s awful for pensioners, holiday-makers or anyone who has an interest in the British economy functioning. A falling currency is like a failing heart. If it were otherwise, then Madagascar would be the economic powerhouse of the global economy and Italy would have been the envy of the world in the Berlusconi years.

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Freedom’s just another word for nothing.

Pentagon Testing Mass Surveillance Balloons Across The US (G.)

The US military is conducting wide-area surveillance tests across six midwest states using experimental high-altitude balloons, documents filed with the Federal Communications Commission (FCC) reveal. Up to 25 unmanned solar-powered balloons are being launched from rural South Dakota and drifting 250 miles through an area spanning portions of Minnesota, Iowa, Wisconsin and Missouri, before concluding in central Illinois. Travelling in the stratosphere at altitudes of up to 65,000ft, the balloons are intended to “provide a persistent surveillance system to locate and deter narcotic trafficking and homeland security threats”, according to a filing made on behalf of the Sierra Nevada Corporation, an aerospace and defence company.


The balloons are carrying hi-tech radars designed to simultaneously track many individual vehicles day or night, through any kind of weather. The tests, which have not previously been reported, received an FCC license to operate from mid-July until September, following similar flights licensed last year. Arthur Holland Michel, the co-director of the Center for the Study of the Drone at Bard College in New York, said, “What this new technology proposes is to watch everything at once. Sometimes it’s referred to as ‘combat TiVo’ because when an event happens somewhere in the surveilled area, you can potentially rewind the tape to see exactly what occurred, and rewind even further to see who was involved and where they came from.”

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“even smaller-scale intervention could spark a knee-jerk exodus from the city’s financial markets..”

What Would Chinese Military Intervention In Hong Kong Look Like? (ZH)

According to a new lengthy Bloomberg exploration outlining the possibilities that China’s military could intervene against the now eight weeks-long increasingly violent protests that have gripped Hong Kong streets, a central question now on everyone’s mind is, What will the Chinese military do? Reports began appearing late last week of a Chinese security forces build-up just outside the semi-autonomous city, setting nerves on edge, and this week the chief of the Chinese military garrison in Hong Kong warned that the army stands ready to “protect” Chinese sovereignty. And then there was also the extremely provocative just released “riot control” video, showing People’s Liberation Army (PLA) solders conducing a drill to invade a city in an imagined armed crackdown on protesters and unrest.


The Bloomberg report begins by noting that though Chinese army occupation of Hong Kong remains unlikely, it remains that “even smaller-scale intervention could spark a knee-jerk exodus from the city’s financial markets, drag down property prices and prompt international companies to reconsider their presence in the territory, analysts say.” The major financial hub could suffer “irreparable damage” by such an exodus, along with severely weakening the “one country, two systems” concept in effect since 1997. Chinese military officials, and especially state media have begun floating the argument for “military options” and intervention. Officials also recently described the US as a “black hand” behind the anti-Beijing protests – which began over a proposed extradition bill – something which the US state department dismissed as “ridiculous”.

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And all the sinners saints.

First Human-Monkey Chimera Raises Concern Among Scientists (G.)

Efforts to create human-animal chimeras have rebooted an ethical debate after reports emerged that scientists have produced monkey embryos containing human cells. A chimera is an organism whose cells come from two or more “individuals”, with recent work looking at combinations from different species. The word comes from a beast from Greek mythology which was said to be part lion, part goat and part snake. The latest report, published in the Spanish newspaper El País, claims a team of researchers led by Prof Juan Carlos Izpisúa Belmonte from the Salk Institute in the US have produced monkey-human chimeras. The research was conducted in China “to avoid legal issues”, according to the report.

Chimeras are seen as a potential way to address the lack of organs for transplantation, as well as problems of organ rejection. Scientists believe organs genetically matched to a particular human recipient could one day be grown inside animals. The approach is based on taking cells from an adult human and reprogramming them to become stem cells, which can give rise to any type of cell in the body. They are then introduced into the embryo of another species. Izpisúa Belmonte and other scientists have previously managed to produce both pig embryos and sheep embryos which contain human cells, although the proportions are tiny: in the latter case, researchers estimate that only one cell in 10,000 was human.

Pig-human and sheep-human chimeras are attractive in part because pigs and sheep have organs about the right size for transplantation into humans. However Alejandro De Los Angeles, from the department of psychiatry at Yale University, said it was likely monkey-human chimeras were being developed to explore how to improve the proportion of human cells in such organisms. “Making human-monkey chimeras could teach us how to make human-pig chimeras with the hope of making organs for transplantation,” he said. “It could teach us which types of stem cells we should be using, or other ways of enhancing what’s called ‘human chimerism levels’ inside pigs.”

Read more …

 

 

 

 

 

 

Jul 172019
 
 July 17, 2019  Posted by at 9:20 am Finance Tagged with: , , , , , , , , , , , ,  


Piet Mondriaan Place de la Concorde 1938-43

 

FBI Spreadsheet Puts A Stake Through The Heart Of Steele’s Dossier (Solomon)
Sic Transit Gloria Mueller (Ray McGovern)
House Floor In Chaos Over Pelosi Speech On Trump Tweets (RC)
House Condemns Trump Over ‘Racist Comments’ Tweeted At Congresswomen (R.)
Republican Support For Trump Rises After Racially Charged Tweets (R.)
Pentagon To Review If It Exposed Americans To Weaponised Ticks (G.)
Bitcoin Tumbles As US Senators Grill Facebook On Crypto Plans (R.)
Twitter CEO Maxes Out Donations To Tulsi Gabbard (RT)
Everything’s Fine Until Suddenly it Isn’t: How a Leveraged Loan Blows Up (WS)
Boris Johnson’s New Plan To Sideline Parliament, Guarantee No Deal Brexit (ZH)
Labour Peers Tell Corbyn: You Have Failed Test Of Leadership (G.)
Berlin Buys 670 Flats From Private Owner (G.)
Freeing Julian Assange: Part Three (Suzie Dawson)

 

 

“.. the spreadsheet found upward of 90 percent of the dossier’s claims to be either wrong, nonverifiable or open-source intelligence found with a Google search..”

FBI Spreadsheet Puts A Stake Through The Heart Of Steele’s Dossier (Solomon)

Over months of work, FBI agents painstakingly researched every claim Steele made about Trump’s possible collusion with Russia, and assembled their findings into a spreadsheet-like document. The over-under isn’t flattering to Steele. Multiple sources familiar with the FBI spreadsheet tell me the vast majority of Steele’s claims were deemed to be wrong, or could not be corroborated even with the most awesome tools available to the U.S. intelligence community. One source estimated the spreadsheet found upward of 90 percent of the dossier’s claims to be either wrong, nonverifiable or open-source intelligence found with a Google search. In other words, it was mostly useless.


“The spreadsheet was a sea of blanks, meaning most claims couldn’t be corroborated, and those things that were found in classified intelligence suggested Steele’s intelligence was partly or totally inaccurate on several claims,” one source told me. The FBI’s final assessment was driven by many findings contained in classified footnotes at the bottom of the spreadsheet. But it was also informed by an agent’s interview, in early 2017, with a Russian that Steele claimed was one of his main providers of intelligence, according to my sources.

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“..the new facts — emerging, oddly, from the U.S. District Court, pose such a fundamental challenge to Mueller’s findings that no one should be surprised if Mueller’s testimony is postponed again.”

Sic Transit Gloria Mueller (Ray McGovern)

As the truth seeps out, there will be plenty of crow to go around. To avoid eating it, the Democrats on the House Judiciary and Intelligence Committees, the stenographers who pass for journalists at the Times and Post, and the “Mueller team” will need all the time they can muster to come up with imaginative responses to two recent bombshell revelations from the United States District Court for the District of Columbia. Perhaps the most damning of the two came last Monday, when it was disclosed that, on July 1, Judge Dabney Friedrich ordered Mueller to stop pretending he had proof that the Russian government was behind the Internet Research Agency’s supposed attempt to interfere via social media in the 2016 election.

While the corporate media so far has largely ignored Judge Friedrich’s order, it may well have been enough to cause very cold feet for those attached to the strained Facebook fable. (The IRA social-media “interference” has always been ludicrous on its face, as journalist Gareth Porter established.) Ten days is not a lot of time to conjure up ways to confront and explain Judge Friedrich’s injection of some unwelcome reality. Since the Democrats, the media, and Mueller himself all have strong incentive to “make the worst case appear the better” (one of the twin charges against Socrates), they need time to regroup and circle the wagons. The more so, since Mueller’s other twin charge — Russian hacking of the DNC — also has been shown, in a separate Court case, to be bereft of credible evidence.

No, the incomplete, redacted, second-hand “forensics” draft that former FBI Director James Comey decided to settle for from the Democratic National Committee-hired CrowdStrike firm does not qualify as credible evidence. Both new developments are likely to pose a strong challenge to Mueller. On the forensics, Mueller decided to settle for what his former colleague Comey decided to settle for from CrowdStrike, which was hired by the DNC despite it’s deeply flawed reputation and well known bias against Russia. In fact, the new facts — emerging, oddly, from the U.S. District Court, pose such a fundamental challenge to Mueller’s findings that no one should be surprised if Mueller’s testimony is postponed again.

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Good read on a pretty nutty spectacle.

House Floor In Chaos Over Pelosi Speech On Trump Tweets (RC)

Amid debate over whether to condemn tweets by President Donald Trump as racist on Tuesday, the House descended into parliamentary chaos, with Rep. Emanuel Cleaver II, who was presiding, abruptly dropping the gavel and saying, “I abandon the chair.” It was an extraordinary moment on an extraordinary day, as the House considered a resolution condemning Trump’s tweets from the weekend that told four freshman Democrats from the House to “go back and help fix the totally broken and crime infested places from which they came.” Before Cleaver’s action, House debate had come to an abrupt halt when Georgia Republican Doug Collins took a rare procedural step to “take down” comments by Speaker Nancy Pelosi characterizing Trump’s tweets as racist.


“Every member of this institution, Democratic and Republican, should join us to condemn the president’s racist tweets,” said Pelosi, speaking on the House floor. Collins interjected unsuccessfully, but once Pelosi was finished speaking, made Pelosi an offer. “I was just going to give the gentle speaker of the House, if she would like to rephrase that comment?” he asked. Pelosi responded that she cleared her remarks with the parliamentarian before she read them on the floor. “I ask that her words be taken down,” Collins said as Pelosi walked away from the rostrum to a spattering of applause. “I make a point of order that the gentlewoman’s words are unparliamentary and request they be taken down.” Collins set off a more than hour-long review and debate over Pelosi’s comments before a decision could be rendered.

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Virtue signalling 101. As if the divide isn’t wide enough yet.

House Condemns Trump Over ‘Racist Comments’ Tweeted At Congresswomen (R.)

The U.S. House of Representatives voted on Tuesday to condemn President Donald Trump for “racist comments” against four minority Democratic congresswomen, a symbolic measure aimed at shaming Trump and his fellow Republicans who stood by him. The 240-187 vote, which split mainly along party lines, was the culmination of three days of outrage sparked by a Trump tweetstorm that diverted attention from other business in Washington but had little impact on the president’s overall approval rating, according to a new Reuters/Ipsos poll. Trump is seeking re-election next year. Trump had told the group of congresswomen on Sunday to “go back and help fix the totally broken and crime infested places from which they came.” [..]


“These comments from the White House are disgraceful and disgusting and these comments are racist,” Pelosi said. “Every single member of this institution, Democratic and Republican, should join us in condemning the president’s racist tweets.” Pelosi’s comments put the House into a two-hour limbo after Republicans argued she went too far in her comments and broke debate rules. House Republican leader Kevin McCarthy criticized Democrats for remarks that upset the “order and decency” of the chamber, saying: “Today is the day that historians will write about.”

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Not surprising. The trenches have been dug.

Republican Support For Trump Rises After Racially Charged Tweets (R.)

Support for U.S. President Donald Trump increased slightly among Republicans after he lashed out on Twitter over the weekend in a racially charged attack on four minority Democratic congresswomen, a Reuters/Ipsos public opinion poll shows. The national survey, conducted on Monday and Tuesday after Trump told the lawmakers they should “go back and help fix the totally broken and crime infested places from which they came,” showed his net approval among members of his Republican Party rose by 5 percentage points to 72%, compared with a similar poll that ran last week.


Trump, who is seeking re-election next year, has lost support, however, with Democrats and independents since the Sunday tweetstorm. Among independents, about three out of 10 said they approved of Trump, down from four out of 10 a week ago. His net approval – the percentage who approve minus the percentage who disapprove – dropped by 2 points among Democrats in the poll. Trump’s overall approval remained unchanged over the past week. According to the poll, 41% of the U.S. public said they approved of his performance in office, while 55% disapproved.

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Craziest topic in a long time. Lyme comes from an army lab.

Pentagon To Review If It Exposed Americans To Weaponised Ticks (G.)

The US House of Representatives has called for an investigation into whether the spread of Lyme disease had its roots in a Pentagon experiment in weaponising ticks. The House approved an amendment proposed by a Republican congressman from New Jersey, Chris Smith, instructing the defence department’s inspector general to conduct a review of whether the US “experimented with ticks and other insects regarding use as a biological weapon between the years of 1950 and 1975”. The review would have to assess the scope of the experiment and “whether any ticks or insects used in such experiment were released outside of any laboratory by accident or experiment design”.


The amendment was approved by a voice vote in the House and added to a defence spending bill, but the bill still has to be reconciled with a Senate version. Smith said the amendment was inspired by “a number of books and articles suggesting that significant research had been done at US government facilities including Fort Detrick, Maryland, and Plum Island, New York, to turn ticks and other insects into bioweapons”. A new book published in May by a Stanford University science writer and former Lyme sufferer, Kris Newby, has raised questions about the origins of the disease, which affects 400,000 Americans each year. Bitten: The Secret History of Lyme Disease and Biological Weapons, cites the Swiss-born discoverer of the Lyme pathogen, Willy Burgdorfer, as saying that the Lyme epidemic was a military experiment that had gone wrong.

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“..a U.S. senator said Facebook was “delusional” to believe people will trust it with their money.”

Bitcoin Tumbles As US Senators Grill Facebook On Crypto Plans (R.)

The cryptocurrency market took a beating on Tuesday with bitcoin losing over 10% in value after U.S. lawmakers grilled Facebook on its cryptocurrency plans, as political and regulatory scrutiny of digital coins intensifies. The social media giant is fighting to get Washington onside after it shocked regulators and lawmakers with its announcement on June 18 that it was hoping to launch its own digital coin called Libra in 2020. David Marcus, the company’s top executive overseeing the planned Libra project, answered questions from the Senate Banking Committee. During the hearing, a U.S. senator said Facebook was “delusional” to believe people will trust it with their money.


Facebook’s Libra plan, which is seen as a major step for wider adaptation of virtual currencies, has helped stoke this year’s rally in bitcoin, ethereum and other digital coins. “Libra is essentially slammed in the Senate,” said Lennon Sweeting, head trader at Coinsquare Capital Markets Ltd. “It’s just headline-driven volatility.” Digital currencies will likely recover with bitcoin returning to a $11,000-$12,000 trading range, Sweeting said. At 2:56 p.m. (1856 GMT), bitcoin fell 11.69% to $9,582.12 on the Luxembourg-based Bitstamp exchange. It fell below $10,000 for the first time in two weeks.

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And the next moment Jack’s twisted head erased Julian Assange’s Unity4J support.

Twitter CEO Maxes Out Donations To Tulsi Gabbard (RT)

Twitter CEO Jack Dorsey has donated thousands of dollars to anti-war Democratic presidential candidate Tulsi Gabbard – and Twitter users and mainstream media journalists are (rather ironically) up in arms about it. Dorsey gave the maximum donation of $5,600 to Gabbard’s campaign a day after her appearance during the first Democratic presidential campaign in June, according to Federal Election Commission (FEC) filings, reported on by BuzzFeed. Of all the Democrat contenders for the 2020 nomination, the Hawaii congresswoman has been a favorite punching bag for US journalists, who have accused her of being “pro-Russia” due to her anti-intervention foreign policy stances. She has also been consistently targeted for meeting Syrian President Bashar Assad during a 2017 trip to the war-torn country, with the media deriding her as an “Assad apologist” ever since.


BuzzFeed’s own story on Dorsey’s donations even smacks of disbelief, claiming that Gabbard is “probably best known for her visit to Syrian dictator” Assad, despite the fact that she is obviously well-known for other things, like being a high-profile congresswoman and Iraq war veteran. Later, BuzzFeed notes that Dorsey also scandalously “faved a bunch of tweets” from and about Gabbard. Needless to say, Dorsey’s own conspiracy machine – also known as Twitter – kicked into high gear, with people accusing him of being a Russian-bot-loving Assad apologist whose donations are “disappointing.”

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”And there are $1.3 trillion of them.”

Everything’s Fine Until Suddenly it Isn’t: How a Leveraged Loan Blows Up (WS)

Golden Gate Capital – the private equity firm now infamous for asset-stripping its portfolio company Payless ShoeSource into bankruptcy and liquidation – strikes again with another of its portfolio companies, Clover Technologies, whose $693-million leveraged loan has suddenly gone to heck. Slices of that leveraged loan are traded like securities. But because leveraged loans are loans, not securities, the SEC doesn’t regulate them. No one regulates them, though the Fed wrings its hands about them periodically. And there are $1.3 trillion of them.

The market for them is very illiquid, even during good times, and before Clover disclosed some issues on July 9, the loan still traded at 97 cents on the dollar, according to Bloomberg. This was the day investors, such as leveraged loan mutual funds and institutional investors that held these slices, suddenly woke up with the foul odor of debt restructuring and bankruptcy in the air. Within just a few days, the price of the loan plunged 35% to 62.625 cents on the dollar. The loan was “covenant-lite,” giving fewer protections to investors and allowing the company and its owners to get away with all kinds of things. This included the absence of certain disclosure requirements.


Not that we feel sorry for investors that suddenly got whacked: They knew that leverage loans are risky, that they’re issued by junk-rated over-leveraged companies with iffy cash-flows, often to fund their own leveraged buyout by a PE firm, and to fund special dividends back to the PE firm. Both factors apply to Clover’s leveraged loan. Investors don’t care. They’re chasing yield no matter what the risks, in a world where yield has been repressed by central-bank policies.

Read more …

Cheap tricks is what you need?!

Boris Johnson’s New Plan To Sideline Parliament, Guarantee No Deal Brexit (ZH)

The British pound tumbled to its weakest level in more than two years on Tuesday as fears of a ‘no deal’ Brexit continued to weigh on GBP, which has been steadily sinking during the Tory leadership contest that many expect will send Boris Johnson, a committed Brexiteer, to No. 10 Downing Street. And on Tuesday, Johnson – who said last night that he wouldn’t accept any time limits (both he and his rival Jeremy Hunt ruled out such a measure), unilateral escape hatches or any other kind of elaborate device to make the Irish Backstop more palatable – gave investors one more reason to worry: Sky News reports, citing anonymous sources from within Johnson’s campaign, that the candidate could delay a customary speech by the Queen that marks the beginning of the Parliamentary session – this would render MPs unavailable on Oct. 31, the day the UK is set to leave the EU.

Though Johnson’s rival Jeremy Hunt has said he’s open to another brief delay, Johnson’s position is that on Halloween, Brexit will finally mean Brexit. There have been some negotiations to work out an alternative to Theresa May’s withdrawal agreement, but thanks to the inevitability of dealing with the hated Irish Backstop – which conservatives argue would effectively allow Europe to annex Northern Ireland – talks have once again been fraught. As Sky explains (for our American readers), Parliament is typically out of session for between one and two weeks ahead of the Queen’s speech – meaning MPs would in effect be unavailable to stop a no-deal Brexit immediately before October 31.

Johnson’s campaign confirmed that the delay is one option being explored, but insisted that no final decision had yet been made. But others pointed out that this move would scupper the chances of a last-minute deal, since Parliament wouldn’t be there to approve it. With an orderly Brexit is looking less likely by the day – even as some remainer Tories join the struggle to thwart their own future leader. And for anybody trying to discern what might happen next, well, BBG has put together yet another complicated Brexit flow chart.

Read more …

The Labour Blairites prefer Boris over Corbyn.

Labour Peers Tell Corbyn: You Have Failed Test Of Leadership (G.)

More than sixty Labour peers have taken out an advertisement accusing Jeremy Corbyn of having “failed the test of leadership” over his handling of antisemitism complaints within the party. The peers, including more than a dozen former ministers such as Peter Hain, Beverley Hughes and John Reid, have addressed the advert in the Guardian to Corbyn directly, saying: “The Labour party welcomes everyone* irrespective of race, creed, age, gender identity, or sexual orientation. (*except, it seems, Jews). This is your legacy, Mr Corbyn.”

Representing about a third of Labour’s members in the House of Lords, the signatories told Corbyn the party was “no longer a safe place for all members” and claimed that thousands have resigned their membership “because of the toxic culture you have allowed to divide our movement”. The advert has been taken out amid a backlash within the party about the leadership’s response to a BBC Panorama documentary that aired last week, in which eight former staff members accused the Labour of failing to tackle complaints about antisemitism properly and allowing Corbyn’s office to get involved in disputes.

Labour strongly denied any interference by the leader’s office, complained to the BBC and said the claims were made by “disaffected former officials including those who have always opposed Jeremy Corbyn’s leadership, worked to actively undermine it, and have both personal and political axes to grind”. In the advert, the 64 Labour peers state that Corbyn has not opened his eyes, taken responsibility or told the whole truth when it came to acknowledging the scale of complaints about antisemitism afflicting the party. “We are not asking if you are an antisemite. We are saying you are accountable as leader for allowing antisemitism to grow in our party and presiding over the most shaming period in Labour’s history,” they said.

Read more …

Government and central bank blow housing bubble, city must come to the rescue.

Berlin Buys 670 Flats From Private Owner (G.)

The state of Berlin has bought back 670 apartments on the historic Karl-Marx-Allee from a private owner after decades of property privatisation in the German capital. A 1950s prestige project for socialist East Germany, the grand boulevard that stretches from the city centre to Friedrichshain in the east has been the frontline of a months-long fight over gentrification and rising property prices. The struggle erupted last November when the property management firm Predac announced its intention to offload 700 apartments on the road to Berlin’s largest property company, Deutsche Wohnen. Fearing rent increases, tenants organised protest marches and hung banners from their apartments, eventually pushing the city senate to block the sale.


After months of legal wrangling, the senate confirmed on Monday that three blocs containing more than 670 apartments would instead be purchased by the state-owned housing provider Gewobag. While the price of the sale was not confirmed by either side, the move to renationalise the buildings on Karl-Marx-Allee is likely to come at a steep cost, with estimates ranging between €90m-€100m (£80m-£90m). Berlin’s mayor said the move was indicative of a wider strategy to reacquire housing stock sold to private investors in the 1990s, following rapid rises in rental costs in the city in recent years. “Berliners should be able to continue to afford living in the city,” said Michael Müller. “That is why it was and continues to be our intention to buy up apartments wherever we can, so that Berlin can regain control of its property market.”

Read more …

10,000 words on how to be an activist.

Freeing Julian Assange: Part Three (Suzie Dawson)

The movement to free Julian has already been a long battle but is likely to continue for many years to come. The movement to free Nelson Mandela was eight years to fruition, but some thirteen years of prior groundwork before that. Mandela was in prison for over a quarter century before being celebrated as a Nobel laureate or ascending to the Presidency of South Africa. These emancipation struggles are intergenerational. Nor are they guaranteed victories. There are no easy wins – they are hard. They are meaningful. And that’s why each win is so precious. Sometimes the same battle has to be won over and over again. At every stage, we individually and collectively have been, are and will be opposed by monied, institutional powers vastly greater than ourselves. To outmanoeuvre them takes great savvy.


It takes staunch, unmoving, determined activists willing to sacrifice the comforts of a conventional existence in service to greater principles. To be an activist like that, takes 50% natural talent and personal efficacy and 50% skill learned through experience, modelling and nurturing by other activists. I’m very lucky to have had both, and in this article I will attempt to pass on as much as I can of what I have learned, just as others did for me. In my nearly eight years of activism, I have traversed a rocky road fraught with peril and packed full of hard-learned lessons. I’ve gone from green, idealistic and largely oblivious, to jaded, seasoned and discerning. To varying extents, every other activist is somewhere along that path as well. Some are far, far more advanced than myself. (Julian would be a great example of this.)

Read more …

 

Apollo 11 U.S. Customs form after first moon landing

 

 

 

 

Jun 162019
 
 June 16, 2019  Posted by at 9:03 am Finance Tagged with: , , , , , , , , , , ,  


Keith Haring Untitled 1984

 

Ai Weiwei on Hong Kong and Assange (Rep.)
ECB Will Act If Inflation Expectations Are De-Anchored: de Guindos (R.)
European Banks Sink to Dec 24, 2018 Level – First Seen in 1995 (WS)
Pentagon Keeps Trump in the Dark About its Cyber Attacks on Russia (RS)
Boris Johnson’s No-Deal Brexit Plan ‘Will Trigger Early Election’ (O.)
Hundreds Dressed In Black Rally To Demand Hong Kong Leader Steps Down (R.)
Is The Caspian A Sea Or A Lake? (ZH)
Pilots Reveal Safety Fears Over Boeing’s Fleet Of Dreamliners (O.)
Record CO2 Emissions In 2018 Driven By Surging Use Of Gas (CB)
Hundreds Of Dolphins Have Died Along Gulf Coast Since February (AP)
Namibia Forced By Drought To Auction 1,000 Wild Animals (AFP)

 

 

“Julian Assange is a political prisoner. Clearly. There is no clearer definition than that.”

Interview in Italy’s La Repubblica, translation is a bit dodgy.

Ai Weiwei on Hong Kong and Assange (Rep.)

“How could he defend himself? He will not be under a clear law environment if he is taken to the US or already now as he has been holding in Europe, UK. Julian Assange is a political prisoner. Clearly. There is no clearer definition than that. What Assange did is not more than any newspaper does or publish important information that they think the people need to know. I think that if Assange is extradited, it will have huge consequences not just to it but also to the European moral or legal system. And it would completely redefine Europe as a place not caring about human rights anymore. Unfortunately this is happening all the time. But this time it will be clearly remembered as a landmark of the failure of our times.

It’s very interesting if you look at what’s happening about extradition. There are three cases about that going on in the world: Hong Kong, Assange and Huawei case, here the daughter of the founder is jailed in Canada because the US asked her extradition. I don’t know if she is a political prisoner but for sure she is part of the US strategy to limit China’s development in the world and the possibility of becoming a global leader. I’m not saying if it is right or wrong but it is fair this kind of situation. These three cases resemble a very interesting judicial challenge. At this moment after globalization the whole political structure of the world is being restored.


Now it’s starting to be challenged at the foundation of our rules, how do you readjust those rules and how to protect individuals’ freedom from the interest of state powers. That is a new task that any establishment of rule has to be concerned with. Nobody had put this together. This is an issue now embodied by different characters but actually it is one character.

Read more …

Remember: central bankers don’t have to actually understand what they do (and they don’t), they just have to make you believe they do.

ECB Will Act If Inflation Expectations Are De-Anchored: de Guindos (R.)

Longer-term inflation expectations in the euro zone need to come unstuck for the European Central Bank to provide more stimulus, ECB Vice President Luis de Guindos was quoted on Saturday as saying. With growth slowing and inflation staying well below the ECB’s target, the bank recently raised the prospect of even more stimulus, arguing that a rate cut or even more asset purchases may become necessary. “What we need to see is a de-anchoring of inflation expectations,” de Guindos told Italian newspaper Corriere della Sera when asked what the bank needed to see to provide more stimulus. “This has not yet happened, despite the fact that there has been a drop in market-based inflation expectations.”


With interest rates already at record lows and a 2.6 trillion euro ($2.9 trillion) bond purchase scheme ended just last year, analysts argue that the ECB has very little actual firepower left as its remaining tools lack significant potency. “If there is a further deterioration, then we will react,” de Guindos added. “But for now, our monetary policy stance is fully compatible with both inflation and real activity.” But de Guindos added that monetary policy is largely powerless against the impact of global trade disputes, one of the biggest drags on growth and thus inflation. “You can certainly smooth the impact with monetary policy, but you will not be able to address and fix this kind of problems with monetary policy,” he said.

Read more …

“..the introduction of negative policy rates by the European Central Bank in mid-2014 leads to more risk-taking and less lending by euro-area banks..”

European Banks Sink to Dec 24, 2018 Level – First Seen in 1995 (WS)

European bank shares – which have been getting crushed and re-crushed for 12 years – are getting re-crushed again. On Friday, the Stoxx 600 Banks index, which covers major European banks, including our hero Deutsche Bank, dropped to an intraday low of 130.5 and closed at 131.2, thereby revisiting the dismal depth of December 24, 2018 (130.8). European banks did not soar on the first trading day after Christmas, unlike other stocks. Instead they fell further and hit their multi-year low on December 27 (129). The index is down 21.5% from a year ago and 33% from January 2018:

[..] that 33% drop from January 2018 in the above chart is a minuscule dip in the long-term collapse-scenario going back to 2007. Buy and hold, indeed. Back to the level first seen in October 1995:

Part of the problem for European banks is NIRP, which was never designed to boost the real economy or make banks healthier so that they could support a vibrant economy. It was designed to boost bond prices and thereby bring yields down, which lowers the costs of borrowing for debt-sinner countries such as Italy, and allows them to borrow for free, which even Italy s government can do with maturities of up to one year. But there is a price to pay. The ECB released a paper in August 2018 where it admits that NIRP could cause a financial crisis because it’s terrible for many banks.


This is the chilling abstract of the paper: “We show that negative policy rates affect the supply of bank credit in a novel way. Banks are reluctant to pass on negative rates to depositors, which increases the funding cost of high-deposit banks, and reduces their net worth, relative to low-deposit banks. As a consequence, the introduction of negative policy rates by the European Central Bank in mid-2014 leads to more risk-taking and less lending by euro-area banks with greater reliance on deposit funding. Our results suggest that negative rates are less accommodative, and could pose a risk to financial stability, if lending is done by high-deposit banks.”

Read more …

“..those new laws are protecting American interests… by keeping the sitting president out of the loop. What a (scary) time to be alive.”

Pentagon Keeps Trump in the Dark About its Cyber Attacks on Russia (RS)

On Saturday, the New York Times published an important story about how the United States military branches are attempting to thwart and combat Russian cyber attacks on American utility networks and interference in elections. But deeper into the article, an interesting and disturbing nugget has drawn attention: The Pentagon has gone out of its way to keep President Donald Trump ignorant of certain details about the operation because of “the possibility that he might countermand it or discuss it with foreign officials.” After giving an in-depth account about the “deployment of American computer code” into Russia’s electric power grid, to work as both a warning to Russian President Vladimir Putin and a more offensive posture in the cyber warfare realm, The Times then wrote:


“Two administration officials said they believed Mr. Trump had not been briefed in any detail about the steps to place ‘implants’ — software code that can be used for surveillance or attack — inside the Russian grid. “Pentagon and intelligence officials described broad hesitation to go into detail with Mr. Trump about operations against Russia for concern over his reaction — and the possibility that he might countermand it or discuss it with foreign officials, as he did in 2017 when he mentioned a sensitive operation in Syria to the Russian foreign minister.” New laws, enacted by Congress last year, allow such “clandestine military activity” in cyberspace to go ahead without the president’s approval. So, in this case, those new laws are protecting American interests… by keeping the sitting president out of the loop. What a (scary) time to be alive.

Read more …

And then they can’t leave?!

Boris Johnson’s No-Deal Brexit Plan ‘Will Trigger Early Election’ (O.)

Boris Johnson’s attempts to appease hardline Tory Brexiters will tilt the party into a “disastrous general election” that could be just months away, senior Conservatives are warning. The runaway favourite to replace Theresa May is being told that the coalition of support set to deliver him Downing Street “won’t survive the autumn”, when he will have to decide whether to accept a deal with the EU or try to force a no-deal Brexit – a move likely to precipitate an election. Senior party figures are already warning of a “wipeout” in some parts of the country, such as Scotland and London, should it go into an election pledging to deliver a no-deal Brexit.


They believe that once in office, Johnson will either be toppled by hardline Eurosceptic MPs should he back away from no deal, or provoke an election by pursuing such a policy. With leadership contenders ruling out a coronation on Saturday, Tory critics are demanding increased scrutiny of Johnson’s Brexit plans. David Gauke, the justice secretary, said: “Boris is saying that he will definitely leave the EU by 31 October, but he is refusing to say how he will do this if parliament takes steps to stop a no-deal Brexit. Will he respond by suspending parliament? Will he seek a general election? This lack of clarity is helping him maintain a broad base of support for now but it won’t survive the autumn. This is why his position on Brexit needs to be tested thoroughly now.”

Read more …

“..if Lam was a stock he would recommend shorting her with a target price of zero. “Call it the Carrie trade.”

Hundreds Dressed In Black Rally To Demand Hong Kong Leader Steps Down (R.)

Activists set up gazebos as protesters, some carrying flowers, started to gather in sweltering summer heat to march from Victoria Park to Hong Kong’s central government offices. Beijing-backed Hong Kong Chief Executive Carrie Lam on Saturday indefinitely delayed the extradition bill that could send people to mainland China to face trial, expressing “deep sorrow and regret”. The about-face was one of the most significant political turnarounds by the Hong Kong government since Britain returned the territory to China in 1997, and it threw into question Lam’s ability to continue to lead the city. Activist investor David Webb, in a newsletter on Sunday, said if Lam was a stock he would recommend shorting her with a target price of zero.


“Call it the Carrie trade. She has irrevocably lost the public’s trust,” Webb said. “Her minders in Beijing, while expressing public support for now, have clearly lined her up for the chop by distancing themselves from the proposal in recent days.” Protest organizers are hoping more than a million people turn up for the Sunday rally, scheduled to start at 2.30pm local time, similar to numbers they estimated for a demonstration against the proposed extradition bill last Sunday. Police put that count at 240,000.

Read more …

Tyler’s headline: “How Iran Was Swindled Out Of $3.2 Trillion”. But there’s more to this story. The difference between a lake and a sea is huge for the law.

Is The Caspian A Sea Or A Lake? (ZH)

At stake is the allocation of revenues from the wider Caspian basins area, including both onshore and offshore fields, that is conservatively estimated to have around 48 billion barrels of oil and 292 trillion cubic feet (Tcf) of natural gas in proved and probable reserves. Around 41 percent of total Caspian crude oil and lease condensate and 36 percent of natural gas exists in the offshore fields, with an additional 35 percent of oil and 45 percent of gas estimated to lie onshore within 100 miles of the coast, particularly in Russia’s North Caucasus region. The remaining 12 billion barrels of oil and 56 Tcf of natural gas are believed to be variously located further onshore in the large Caspian Sea basins, mostly in Azerbaijan, Kazakhstan, and Turkmenistan. The area accounts for an average of 17 percent of the total oil production of the five littoral states that share its resources, on average totalling 2.5-2.9 million barrels per day (mbpd).

[..] the legal designation of the Caspian as either a ‘sea’ or a ‘lake’ would have far-reaching repercussions on the assignment of revenues from it. If it was designated a sea then coastal countries would apply the ‘United Nations Convention on the Law of the Sea’ (1982), in which event each littoral state would receive a territorial sea up to 12 nautical miles, an exclusive economic zone up to nautical 200 miles, and a continental shelf. In practice, this would mean that countries such as Turkmenistan and Azerbaijan would have exclusive access to offshore assets that Iran would not be able to access. If it was designated a lake – and this was the informal designation before the August agreement – then the countries could use the international law concerning border lakes to set boundaries, by which each country effectively possesses 20 percent of the sea floor and surface of the Caspian.

In the preparations for the signing of the ‘Convention on the Legal Status of the Caspian Sea’ last August, Iran had engaged lawyers to challenge the established 20 percent share that each littoral state had informally agreed upon, based on the fact that Russia should have used its own original 50 percent share to make good stakes for its former USSR states. [..] Moscow was the prime mover in having the Caspian designated as a sea, not a lake. This was on the basis that because Russia had opened up the channel from the Volga River into the Caspian to prevent the levels dropping, the Caspian no longer conformed to the legal definition of a lake, which is that it is a localised water deposit standing independent of any river that serves to feed it.

[..] “This meant, effectively, that Russia could divide up the shares as it saw fit, and the way it saw fit was to benefit its existing ally, Kazakhstan, which was assigned a 28.9 percent share, and its wished-for ally, Azerbaijan, which secured a 21 percent stake, while Russia saw a slight increase, to 21 percent, while Turkmenistan’s share goes down to 17.225 percent, as it is seen as a softer touch by Russia, and Iran’s share goes down to just 11.875 percent,” said the Iran source. “This switch from 50 percent to just over 11 percent means that Iran will lose at least US$3.2 trillion in revenues from the disputed and lost value of energy products going forward,” concluded the Iran source.

Read more …

Can’t catch a break: “we would have to fly with a burning wing for up to three hours before we could safely land..”

Pilots Reveal Safety Fears Over Boeing’s Fleet Of Dreamliners (O.)

Airline pilots have voiced fears over the safety of a fleet of Boeing aircraft after a crucial fire-fighting system has been found to have the potential to malfunction. Boeing has issued an alert to airlines using its flagship B787 Dreamliner, warning that the switch used to extinguish an engine fire has failed in a “small number” of instances. The switch also severs the fuel supply and the hydraulic fluid to prevent flames spreading. UK airlines Tui, British Airways and Virgin Atlantic operate more than 60 Dreamliners between them. The US regulator, the Federal Aviation Administration (FAA), has decided not to ground the fleet, despite admitting a “risk to the flying public”.

Pilots, however, claim that the safety of passengers and crew is being compromised. “If there was an engine fire on a transatlantic flight and the aircraft had one of the defective fire switches, then we would have to fly with a burning wing for up to three hours before we could safely land,” a pilot with a British airline told the Observer. In its alert to airlines, Boeing warns that long-term heating can cause the fire switch to stick in the locked position so it can’t be used to release the two fire extinguishers in each engine.


[..] “Boeing insists that the risk of an engine fire is very low, and that’s true, but it’s Boeing’s attitude to the risk that has upset us, especially in light of recent B737 Max issues. If the fire switch malfunctions, there’s no manual override to deploy the engine fire extinguishers and therefore no way of putting out a fire, but Boeing says that it’s fine, and the airlines agree. Such is the fear of Boeing’s power that no one dares speak out.”

Read more …

More. And more.

Record CO2 Emissions In 2018 Driven By Surging Use Of Gas (CB)

Last year saw record levels of CO2 emissions, gas and oil use, and installations of renewable energy, according to new global data from oil giant BP. Gas was the largest driver of energy-use growth in 2018, responsible for more than 40% of the increase. This, along with increased use of oil and coal, led to global CO2 emissions rising by 2% in 2018, the largest year-on-year increase in seven years. Renewable energy sources were the largest source of new electricity generation worldwide for the third year in a row, driven primarily by the growth of wind and solar generation. Wind and solar grew at their second fastest rate on record, driven by growth in China, though the growth in wind and solar generation in the US, EU, and India was slower in 2018 than in 2017.

However, there is a constantly growing gap between today’s energy use and what would be needed to meet the goals of the Paris Agreement, given that emissions must, according to scientists, reach net-zero by mid-century to avoid dangerous levels of global warming. Energy use grew in 2018 at a rate of 2.9%, the largest growth since 2010. China, the US and India accounted for more than two-thirds of global energy-use growth, with US energy use expanding at the fastest rate for 30 years. Energy use increased by 390m tonnes of oil equivalent (Mtoe) in 2018. Fossil fuels were responsible for 71% of this, while near-zero-carbon energy sources, including solar, wind, hydro and nuclear, were responsible for 29%.


Natural gas represented the single largest contributor to global energy-use growth in 2018, increasing by 5.3% compared to 2017. It alone was responsible for 40% of the increase in total energy use. Non-hydro renewables grew by 14.5% in 2018. This was the largest relative growth of any energy source, though it was still below the record growth experienced in 2017. Non-hydro renewables now represent 4% of global energy use, with all zero-carbon sources representing 15% of global energy. Oil consumption grew by 1.5% in 2018, with China and the US contributing around 85% of the growth in oil use. This growth was primarily concentrated in the transportation sector, reflecting increased vehicle ownership and miles driven.

Read more …

Oil.

Hundreds Of Dolphins Have Died Along Gulf Coast Since February (AP)

At least 279 dolphins have become stranded across much of the US Gulf Coast since the start of February, triple the usual number, and about 98% of them have died, scientists from the National Oceanic and Atmospheric Administration (Noaa) said. Scientists will investigate whether lingering effects from the 2010 BP oil spill and more immediate effects from low salinity because of freshwater flowing from high rivers and a Louisiana spillway contributed to the deaths, said Teri Rowles, coordinator for Noaa fisheries’ marine mammal health and stranding response program. BP spill effects included problems with lungs and adrenal glands, which produce stress-related hormones; blood abnormalities; and general poor condition, according to earlier reports.

Those reports said the spill contributed to the Gulf of Mexico’s largest and longest dolphin die-off. “We do know some of the health conditions … are improving, but some have been slow to improve,” Rowles said on Friday. “Reproduction in the heaviest-oiled areas continues below normal.” Erin Fougeres, administrator for the marine mammal stranding program in Noaa fisheries’ south-east region, said 23% of the dolphins stranded from Louisiana to the Florida Panhandle had sores consistent with freshwater exposure. Such lesions are “not uncommon” in the spring, according to Noaa’s website. Mississippi had 121 dolphin strandings as of Wednesday, with 89 in Louisiana, 32 in Alabama and 37 in Florida, Fougeres said.


Moby Solangi, director of the Institute of Marine Mammal Studies in Gulfport, Mississippi, put that state’s total on Thursday at 126, and said the opening of the Bonnet Carré spillway was at least partly to blame.The effects were worse for Mississippi’s dolphins than the BP spill was, he said, noting that 91 dead dolphins were found in Mississippi during all of 2010. Dolphins continued to die for years because of oil spill damage, a 2015 study reported. Freshwater exposure “doesn’t appear to be the cause of death for all animals, so that’s something we’re continuing to investigate”, Fougeres said. Rowles noted that 70% of the carcasses were too decomposed for necropsy.

Read more …

There must be better ways.

Namibia Forced By Drought To Auction 1,000 Wild Animals (AFP)

Drought-hit Namibia has authorised the sale of at least 1,000 wild animals – including elephants and giraffes – to limit loss of life and generate US$1.1 million for conservation, the authorities confirmed Saturday. “Given that this year is a drought year, the [environment] ministry would like to sell various type of game species from various protected areas to protect grazing and at the same time to also generate much needed funding for parks and wildlife management,” the environment ministry spokesman Romeo Muyunda said. The authorities declared a national disaster last month, and the meteorological services in the southern African nation estimate that some parts of the country faced the deadliest drought in as many as 90 years.

“The grazing condition in most of our parks is extremely poor and if we do not reduce the number of animals, this will lead to loss of an animals due to starvation,” Muyunda said. In April, an agriculture ministry report said 63,700 animals died in 2018 because of deteriorating grazing conditions brought on by dry weather. Namibia’s cabinet announced this week that the government would sell about 1,000 wild animals. They include 600 disease-free buffalos, 150 springbok, 65 oryx, 60 giraffes, 35 eland, 28 elephants, 20 impala and 16 kudus – all from national parks. The aim is to raise $1.1 m that will go towards a state-owned Game Products Trust Fund for wildlife conservation and parks management.


The government said there were currently about 960 buffalos in its national parks, 2,000 springbok, 780 oryx and 6,400 elephants. The auction was advertised in local newspapers from Friday. Namibia, a country of 2.4 million people, has previously made calls for aid to assist in the drought emergency that has already affected over 500,000 people.

Read more …

 

 

 

 

 

Jan 112019
 
 January 11, 2019  Posted by at 10:16 am Finance Tagged with: , , , , , , , , , , , , ,  


Hieronymous Bosch The Haywain Triptych c.1516 (click to enlarge)

 

The Stock Market Just Got Off To Its Best Start In 13 Years (MW)
78% of US Workers Live Paycheck To Paycheck (CNBC)
Fed’s Powell Says He Is ‘Very Worried’ About Growing Amount Of US Debt (CNBC)
Trump Digs In As Shutdown Continues (BBC)
Michael Cohen To Testify Publicly Before Congress In February (G.)
China Set To Lower GDP Growth Target In 2019 (R.)
Can The Chinese Consumer Be Resurrected? (Jim O’Neill)
Why I Asked May If She Is On The Side Of Putin Or The People (Moran)
May’s Brexit Deal ‘Threat To National Security’ – Former MI6 Chief (Ind.)
May Begs Unions To Help Salvage Her Brexit Deal (Ind.)
US Defenses No Match For Russian Hypersonic Missiles – Retired US General (RT)
Bases, Bases, Everywhere… Except in the Pentagon’s Report (Turse)
Oceans Warming Faster Than Expected, Set Heat Record In 2018 (R.)
Julian Assange’s Living Conditions Deteriorate (Cassandra Fairbanks)

 

 

And there’s still people who claim the stock market reflects the economy.

The Stock Market Just Got Off To Its Best Start In 13 Years (MW)

Things are coming up roses in the stock market, lately. The Dow Jones Industrial Average, S&P 500 index and Nasdaq Composite Index are off to their best starts to a year since 2006 after a powerful series of gains. The Dow closed up 0.5% on Thursday, pushing its year-to-date gain to 2.89%, which would mark the best first seven days to a year since 2006, when stocks burst 3.04% higher over the same period. The S&P 500 rose 0.5% on the day and has returned 3.58% thus far this year, its best start since a 3.68% gain 13 years ago, while the Nasdaq Composite booked a 0.4% gain, enough for a 5.3% year-to-date advance, representing its best seven-session to kick off a year since its 5.72% rise also in 2006.

A late-session rally helped to solidify Thursday’s gains, coming after investors digested comments from Federal Reserve Chairman Jerome Powell, who pronounced at the Economic Club in Washington on Thursday afternoon that the economy is in good health, while adding that the central bank would be cognizant of stresses to financial markets amid rate hikes. The comments were a reiteration of Powell’s remarks last week during a broad panel discussion of current and former Fed bosses that helped to placate anxious investors and reverse what was shaping up to be another dismal year.

Read more …

Why is everybody quoting a 2017 report?

78% of US Workers Live Paycheck To Paycheck (CNBC)

The partial government shutdown, which began Dec. 22, has now stretched well into the new year. President Donald Trump said Friday that it would continue for “months or even years” until he receives the requested $5 billion in funding for a border wall. The shutdown has left approximately 800,000 federal workers in financial limbo. Around 420,000 “essential” employees are working without pay, while another 380,000 have been ordered to stay home, according to calculations provided to CNBC by Paul Light, a professor of public service at New York University. In some cases, the furloughs have forced government employees to tap into their savings, rely on credit cards or crowdsource funds to make ends meet.

Government workers are far from alone in feeling stressed about not getting paid. Nearly 80% of American workers (78%) say they’re living paycheck to paycheck, according to a 2017 report by employment website CareerBuilder. Women are particularly vulnerable: 81% of them report living paycheck to paycheck, compared with 75% of men. Tony Reardon, president of the National Treasury Employees Union, tells CNBC that the group has heard from hundreds of frantic federal employees. “They’re scared,” he says. “They don’t know how they’re going to put food on the table.” Various #ShutdownStories making that point have gone viral on Twitter.

It’s not merely those earning low wages who are struggling. CareerBuilder reports that nearly 10% of Americans with salaries of $100,000 or more live paycheck to paycheck as well. That means that many workers aren’t able to put anything significant into savings. More than 50% of respondents say that they save less than $100 per month. And a comparable 2017 survey from GOBankingRates found that 61% of Americans don’t have enough money in an emergency fund to cover six months’ worth of expenses. [..] more than 70% of all respondents say that they’re in debt, and a quarter of workers say they weren’t able to make ends meet at the end of every month of the past year.

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Which his own Fed has encouraged like nobody else could.

Fed’s Powell Says He Is ‘Very Worried’ About Growing Amount Of US Debt (CNBC)

Federal Reserve Chairman Jerome Powell is concerned about the ballooning amount of United States debt. “I’m very worried about it,” Powell said at The Economic Club of Washington, D.C. “From the Fed’s standpoint, we’re really looking at a business cycle length: that’s our frame of reference. The long-run fiscal, nonsustainability of the U.S. federal government isn’t really something that plays into the medium term that is relevant for our policy decisions.” However, “it’s a long-run issue that we definitely need to face, and ultimately, will have no choice but to face,” he added. The Fed chief’s comments came as the annual U.S. deficit reaches new sustained highs above $1 trillion, a fact many economists worry could spell trouble for future generations.

Annual deficits have topped $1 trillion before, but never during a time of sustained economic growth like now, raising concern about what would happen if a recession hits. Total U.S. debt is about $21.9 trillion, of which $16 trillion is owed by the public. In part because of continued rate increases under Powell, the interest cost on that debt could start to become a bigger and bigger burden. Wall Street’s “bond king” and respected financial prognosticator Jeffrey Gundlach said in December that the Fed seems to be on a “suicide mission,” raising rates while the government deficit increases as a share of GDP. Normally when the deficit is expanding, the Fed would be lowering interest rates.

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View from the MSM: Trump digs in, not the Dems.

Trump Digs In As Shutdown Continues (BBC)

US President Donald Trump has threatened again to declare a national emergency to fund a border wall without Congress’s approval. “I have the absolute right to declare a national emergency,” he told reporters. The White House has denied reports it is looking at diverting funds set aside for reconstruction projects. A political row over funding the wall has left the US government partially shutdown for 20 days, leaving about 800,000 federal employees without pay. President Trump has refused to sign legislation to fund and reopen the government if it does not include $5.7bn for a physical barrier along the US-Mexico border.

But budget talks have come to a standstill as Democrats – who control the House of Representatives – refuse to give him the money. Republican leaders insist the party stands behind the president, although some Republican lawmakers have spoken out in favour of ending the shutdown. On Thursday, Mr Trump visited a border patrol station in McAllen, in the Rio Grande Valley of Texas. He said that if Congress did not approve funding for the wall, he would “probably… I would almost say definitely” declare a national emergency to bypass lawmakers. But such a move is likely to face legal challenges. The money would also have to come from funds allocated by Congress for other purposes – which some Republicans would also oppose.

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Planning a huge media spectacle. Imagine all the readers and viewers… Trump keeps on giving. Bread and circuses it is.

Michael Cohen To Testify Publicly Before Congress In February (G.)

Donald Trump’s longtime lawyer and aide Michael Cohen says he has accepted an invitation from a top House Democrat to testify publicly before Congress next month. His testimony before the House oversight and reform committee on 7 February will be the first major public oversight hearing for Democrats, who have promised greater scrutiny of Trump after winning control of the House in the 2018 midterm elections. Cohen said in a statement: “I look forward to having the privilege of being afforded a platform with which to give a full and credible account of the events which have transpired.”

The New Yorker, who is to begin a three-year prison sentence in March, is a pivotal figure in investigations by the special counsel Robert Mueller into potential collusion between Russia and the Trump campaign, and by federal prosecutors in New York into campaign finance violations related to hush-money payments to two women who say they had sex with Trump. Elijah Cummings, the committee’s chair, said the panel would avoid interfering with Mueller’s investigation. “We have no interest in inappropriately interfering with any ongoing criminal investigations, and to that end, we are in the process of consulting with Special Counsel Mueller’s office,” Cummings said in a statement.

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But not to the 1.67% predicted by professor Xiang Songzuo, I’m sure.

China Set To Lower GDP Growth Target In 2019 (R.)

China plans to set a lower economic growth target of 6% to 6.5% in 2019 compared with last year’s target of “around” 6.5%, policy sources told Reuters, as Beijing gears up to cope with higher U.S. tariffs and weakening domestic demand. The proposed target, to be unveiled at the annual parliamentary session in March, was endorsed by top leaders at the annual closed-door Central Economic Work Conference in mid-December, according to four sources with knowledge of the meeting’s outcome. Data later this month is expected to show the Chinese economy grew around 6.6% in 2018 — the weakest since 1990. Analysts are forecasting a further loss of momentum this year before policy support steps begin to kick in.

“It’s very difficult for growth to exceed 6.5% (this year), and there could be trouble if growth dips below 6%,” said one source who requested anonymity due to the sensitivity of the matter. As the world’s second-largest economy loses steam, China’s top leaders are closely watching employment levels as factories could be forced to shed workers amid a trade war with the United States, despite a more resilient services sector, policy insiders said. Growth of about 6.2% is needed in the next two years to meet the ruling Communist Party’s longstanding goal of doubling gross domestic product and incomes in the decade to 2020, and to turn China into a “modestly prosperous” nation. [..] Local governments could be allowed to issue up to 2 trillion yuan worth of special bonds in 2019, up from 1.35 trillion yuan last year, they said.

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Goldman Sachs to the -image- rescue.

Can The Chinese Consumer Be Resurrected? (Jim O’Neill)

Last week, Apple published a letter to shareholders revising down its expected revenues for the first quarter of 2019, citing an economic slowdown in China, which has become an increasingly important market for iPhone, Mac, and iPad sales. Though tech industry analysts are debating whether internal dynamics at Apple might also explain the change, the company’s new guidance nonetheless adds to the evidence that Chinese consumption is slowing. A sustained decline in Chinese consumption would be even more worrying than the current US-China trade dispute.

Given that US trade policies and other external influences should not have much effect on domestic Chinese spending, the problem may be more deeply rooted in China’s economic model. To understand what is at stake, consider all that has changed just within the past decade. At the end of 2010, domestic consumption accounted for around 35.6% of Chinese GDP, according to official Chinese data. That was remarkably low compared to most other economies, not least the US, where consumption accounted for almost 70% of GDP. In nominal dollar terms, China’s domestic consumption thus was around $2.2tn, or almost five times lower than that of the US ($10.5tn).

Yet China’s high overall growth rate meant that Chinese consumers could potentially play a much larger role, with far-reaching benefits for global brands such as Apple, BMW, Burberry, Ford, and many others. As of 2017, Chinese consumption as a share of GDP had risen to 39.1%, representing just over $5tn in nominal dollar terms. That is an increase of almost $3tn in just seven years. And though Chinese consumer spending still lagged far behind that of the US ($13.5tn in 2017), the gap has narrowed. If China were to continue on the same trajectory in terms of nominal GDP growth and domestic consumption, its consumer spending could increase by another $2tn by 2020, putting it at around half that of the US. Chinese consumers would be more relevant to the global economy than anyone except Americans.

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From time to time you wonder what’s more hysterical, the Brexit mayhem or the UK’s fabricated Russophobia. This is pretty unbelievable, but it’s become normal.

Layla Moran is a Liberal Democrat MP for Oxford West and Abingdon.

Why I Asked May If She Is On The Side Of Putin Or The People (Moran)

For all the farcical invoking of Blitz spirit, Brexit isn’t merely an absurdist experiment in English nationalist nostalgia – it is the most audacious example yet of a futuristic Russian nationalism that seeks to divide and rule Europe. If we can be judged by our friends then Brexit has no stauncher ally than Vladimir Putin. After all, Donald Trump has proved unreliable. But Putin? It is hard to think of anyone who has done more for the cause (and that is not to take anything away from the years of Brexit monologues by Tory MP Bill Cash). Russian bot farms have been exposed as having supported the Leave campaign. This comes on top of allegations of iffy Russian money funding Brexit campaigns, and Arron Banks’ almost comical inability to explain his donations to Leave.

Comical, that is, if his scarcely thought through Brexit wasn’t driving Britain to what Hilary Clinton has called the single biggest act of deliberate self-harm a nation has ever committed. As if Russian interference in the original referendum was not shocking enough, it is still going on. The Channel 4 drama Brexit: The Uncivil War might have relegated Russian involvement to the briefest postscript, but in reality Putin is still in the trenches fighting for a hard Brexit. At a recent press conference Putin attacked the idea of a referendum on the deal, claiming the original result should be respected. Oh, the irony! Putin, the arch kleptocrat, giving advice on democracy. “Don’t steal Brexit,” he seemed to demand, while probably stealing (sorry, being gifted) another superyacht.

It should have been sufficiently chilling to make even Boris Johnson pause for thought. And all while using the Brexiteer message script of delivering the will of the people. As any student of Russian history could tell you, “the people” are often invoked by the Kremlin, including when justifying the mass murder of innocent people. But rarely does the Kremlin actually ask “the people” for anything so radical as an opinion. For Putin, “the people” are to be manipulated and even killed for his own ends. And Putin’s ends are clear. He wants a weak and divided EU. Ultimately, he seeks to break it up, with the Eastern bloc – brought into the European fold by Margaret Thatcher’s single market – dragged back into the lair of the Russian bear.

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And why not? If all else fails, scare them.

May’s Brexit Deal ‘Threat To National Security’ – Former MI6 Chief (Ind.)

The former head of MI6 has warned Theresa May’s Brexit deal will “threaten the national security of the country”, in a call for Tory MPs to reject it. The agreement would “place control of aspects of our national security in foreign hands”, claims Sir Richard Dearlove, in an extraordinary letter to Conservative associations. It has also been signed by Lord Guthrie, a former chief of the defence staff, in a bid to stiffen grassroots resistance, ahead of next Tuesday’s vote.= Sir Richard and Lord Guthrie, who are both prominent Leave supporters, write: “Please ensure that your MP votes against this bad agreement.” The prime minister, a former home secretary, has insisted her agreement would protect national security by retaining existing cooperation arrangements during the 21-month transition.

However, she was forced to acknowledge the UK was likely to lose direct access to vital EU security databases after 2012, under the proposed long-term arrangements. In their letter, the ex-security chiefs argue the deal is dangerous because it would weaken membership of Nato and existing “close” defence and intelligence ties with the US. “This withdrawal agreement, if not defeated, will threaten the national security of the country in fundamental ways,” it says. Downing Street hit back immediately, insisting the letter was “completely wrong” and that the Brexit deal offered the broadest security agreement the EU has with any of its partners. But both sides of the Brexit divide seized on the intervention, arch-Brexiteer Owen Paterson calling it a “devastating warning”.

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After Tuesday all bets are off.

May Begs Unions To Help Salvage Her Brexit Deal (Ind.)

Theresa May has called the leaders of Britain’s biggest unions for the first time since becoming prime minister in a desperate bid to find backing for her Brexit deal. The calls to Unite leader Len McCluskey and the GMB’s Tim Roache – whose unions are Jeremy Corbyn’s biggest financial backers – mark just how far she is being forced to go in the hope of finding support for the deal expected to be rejected by MPs next week. She was scorned by second referendum-backing Mr Roache, who joked after his call that he was “glad the prime minister finally picked up the phone”. The unprecedented move came as she also sought to convince Labour MPs to back her by promising new commitments to maintain workers’ rights in line with EU standards after Brexit.

But expectations that she is heading for a heavy defeat on Tuesday simply grew further, with some estimates suggesting that opposition has actually grown since she delayed the vote on her deal in December. Capitalising on the deep Tory divisions, Mr Corbyn instead invited Conservative MPs to back a motion of no confidence in the government which he is promising to table if Ms May’s plans are defeated. Downing Street confirmed the calls to Mr Roache, whose union has 620,000 members, and Mr McCluskey, representing more than 1.4 million, and admitted it was the first time she had spoken to either of them since her arrival at No 10. The Independent understands the prime minister also attempted to call Dave Prentis, leader of Unison which also has some 1.4 million members, but could not get through because Mr Prentis was travelling.

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Click here for the original Hill article.

US Defenses No Match For Russian Hypersonic Missiles – Retired US General (RT)

A retired general and chief of staff has warned that the US’ missile defense systems are “simply incapable” of stopping the latest generation of Russian hypersonic missiles – some of which fly at 27 times the speed of sound. Now retired, Maj. Gen. Howard ‘Dallas’ Thompson was once Chief of Staff at US Northern Command in Ohio. In a column published by The Hill on Thursday, Thompson argues that military leaders have neglected to develop proper defenses against the hypersonic threat. There have been some calls for the US to pursue hypersonic weapons in defense policy circles, but America has lagged behind China – which conducted more tests in the last year than the US has is a decade – and Russia, which successfully tested such a missile in December. The ‘Avangard’ missile flew at Mach 27, and will be deployed in 2019.

At present, the US Missile Defense Agency’s sensors and radars are designed for one purpose: to counter an intercontinental ballistic missile (ICBM) fired by an adversary like Iran or North Korea. ICBMs have a predictable flight path, and the US’ Patriot and Terminal High-Altitude Area Defense (THAAD) batteries stand a reasonable chance of intercepting and destroying any incoming missiles. Not so with hypersonics. Missiles like ‘Avangard’ fly low and fast, evading radar detection. They can also engage in evasive maneuvers to dodge surface-to-air rockets or missiles, further lowering the chances of a successful interception.

“The stark reality is that our current missile defense systems, as well as our operational mindset, are simply incapable versus this threat,” Thompson wrote. The retired General’s words are backed up by a recent report from the Government Accountability Office, which concluded that there are “no existing countermeasures” against the threat. Thompson claims that a massive collaborative program between the Department of Defense and arms companies is needed to counter Russian and Chinese advances. “Countering this threat will require U.S. investment in an extensive defensive architecture,” he wrote. “…a highly robust ‘family of systems’ that nonetheless must be envisioned, designed, developed and deployed in a completely holistic manner.”

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800 bases, of which 300 are unreported?!

Bases, Bases, Everywhere… Except in the Pentagon’s Report (Turse)

Within hours of President Trump’s announcement of a withdrawal of U.S. forces from Syria, equipment at that base was already being inventoried for removal. And just like that, arguably the most important American garrison in Syria was (maybe) being struck from the Pentagon’s books — except, as it happens, al-Tanf was never actually on the Pentagon’s books. Opened in 2015 and, until recently, home to hundreds of U.S. troops, it was one of the many military bases that exist somewhere between light and shadow, an acknowledged foreign outpost that somehow never actually made it onto the Pentagon’s official inventory of bases. Officially, the Department of Defense (DoD) maintains 4,775 “sites,” spread across all 50 states, eight U.S. territories, and 45 foreign countries.

A total of 514 of these outposts are located overseas, according to the Pentagon’s worldwide property portfolio. Just to start down a long list, these include bases on the Indian Ocean island of Diego Garcia, in Djibouti on the Horn of Africa, as well as in Peru and Portugal, the United Arab Emirates, and the United Kingdom. But the most recent version of that portfolio, issued in early 2018 and known as the Base Structure Report (BSR), doesn’t include any mention of al-Tanf. Or, for that matter, any other base in Syria. Or Iraq. Or Afghanistan. Or Niger. Or Tunisia. Or Cameroon. Or Somalia. Or any number of locales where such military outposts are known to exist and even, unlike in Syria, to be expanding.

[..] According to David Vine, author of Base Nation: How U.S. Military Bases Abroad Harm America and the World, there could be hundreds of similar off-the-books bases around the world. “The missing sites are a reflection of the lack of transparency involved in the system of what I still estimate to be around 800 U.S. bases outside the 50 states and Washington, D.C., that have been encircling the globe since World War II,” says Vine

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The reporting on the issue seems broken.

Oceans Warming Faster Than Expected, Set Heat Record In 2018 (R.)

The oceans are warming faster than previously estimated, setting a new temperature record in 2018 in a trend that is damaging marine life, scientists said on Thursday. New measurements, aided by an international network of 3,900 floats deployed in the oceans since 2000, showed more warming since 1971 than calculated by the latest U.N. assessment of climate change in 2013, they said. And “observational records of ocean heat content show that ocean warming is accelerating,” the authors in China and the United States wrote in the journal Science of ocean waters down to 2,000 metres (6,600 ft). Man-made greenhouse gas emissions are warming the atmosphere, according to the overwhelming majority of climate scientists, and a large part of the heat gets absorbed by the oceans.

That in turn is forcing fish to flee to cooler waters. “Global warming is here, and has major consequences already. There is no doubt, none!” the authors wrote in a statement. Almost 200 nations plan to phase out fossil fuels this century under the 2015 Paris climate agreement to limit warming. [..] Data due for publication next week will show “2018 was the warmest year on record for the global ocean, surpassing 2017,” said lead author Lijing Cheng, of the Institute of Atmospheric Physics at the Chinese Academy of Sciences. He told Reuters that records for ocean warming had been broken almost yearly since 2000. Overall, temperatures in the ocean down to 2,000 metres rose about 0.1 degree Celsius (0.18F) from 1971-2010, he said.

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Another issue on which reporting seems broken. We’re not getting anywhere.

Julian Assange’s Living Conditions Deteriorate (Cassandra Fairbanks)

I last visited Assange in March, days before the Ecuadorians placed the award-winning journalist in isolation for allegedly violating a draconian ban on all public political comments. [..] In order to visit the publisher last year, I simply organized it with him and his lawyer and went. This time I was required to provide details about my social media, my employer, and my reason for visiting in advance of my arrival and hope to be approved. If I wanted to bring my cell phone, I would have had to provide the brand, model, serial number, IMEI number and telephone number. Providing these details to a foreign nation with extreme surveillance seemed unwise, so I left it behind.

[..] Currently, Assange cannot even have a simple visit with a friend without it being monitored by some shadowy state actor. It’s like a scene from the Stasi spy drama The Lives of Others. While Ecuador presents this surveillance operation as a mission to “protect and support” Assange, this is contradicted by the fact that he isn’t even allowed to confidentially speak with a reporter and friend without being recorded. In May, the Guardian reported that there are “extraordinary reports” from these spies that include daily logs of Assange’s activities inside the embassy, even noting his “general mood.”

As John Pilger pointed out after his visit with Assange on New Year’s Eve, it could be any newspaper publisher or editor stuck in that embassy. For the crime of publishing journalism, Assange has not only had to give up his freedom, but also any semblance of privacy. It’s impossible to overstate how unsettling it feels to have multiple lenses pointed at you wherever you stand. Unable to speak privately, even with a noise machine attempting to muffle the microphones from picking up conversations, we resorted to passing notes. Assange is not only barred from sharing his views online under the new regulations — thanks to the constant surveillance, he can’t even do so among his friends in the embassy where he is arbitrarily detained.

If we value the principle of the freedom of speech — we must do something to stop this madness. While we do not know what Assange has been charged with by the U.S. as it remains under seal, we do know that it is related to his work as a publisher, the only publisher with a record of 100% accuracy. His dedication to truth is so profound that he has never once had to issue a correction or retraction.

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Nov 152018
 
 November 15, 2018  Posted by at 10:17 am Finance Tagged with: , , , , , , , , , , ,  


Jean-Francois Millet In the Auvergne 1869

 

UK Brexit Secretary Dominic Raab resigns (BBC)
Final Say Referendum On Table As May Blows Debate Wide Open (Ind.)
Brexit: A Split Cabinet, A Split Party And A Split Nation (G.)
Theresa May’s Brexit Deal Solves Nothing: Open Warfare Is About To Begin (G.)
The Race To 6% Mortgage Rates (WS)
The Fed Will Continue Tightening Until Everything Breaks (Smith)
Amazon’s Long Game Is Clearer Than Ever (Taibbi)
Amazon’s Alexa Might Be A Key Witness In A Murder Case (Vox)
Lockheed Martin Awarded $22.7 Billion Pentagon Fighter Jet Contract (AFP)
Japan Cyber Security Minister Admits He Has Never Used A Computer (AFP)

 

 

UPDATE: Half an hour after I posted this Debt Rattle, two more ministers have evidently resigned: Esther McVey and Suella Braverman. That makes 4 so far today who have left the May government, and 22(!) over the past 2 years.

 

Inevitably, a lot of Brexit stuff today. Somewhat curiously, Mr. Raab ostensibly negotiated the deal May presented yesterday, and because of which he resigned this morning. He won’t be the last. He wasn’t the first either, junior Northern Ireland minister Shailesh Vara was ahead of him.

Meanwhile, May faces Parliament today and the EU has announced a meeting on November 25 to secure the deal. But who will represent the UK there? Because as prominent Tory Anna Soubry said: “Raab’s resignation marks the end of PMs Withdrawal Agreement. This is v serious the PM will clearly be considering her position.”.

UK Brexit Secretary Dominic Raab resigns (BBC)

Brexit Secretary Dominic Raab has resigned saying he “cannot in good conscience support” the UK’s draft Brexit agreement with the EU. Theresa May announced on Wednesday evening that she had secured the backing of her cabinet for the agreement, after a five hour meeting. But several ministers were understood to have spoken against it. And there are suggestions of moves among Conservative backbenchers to force a no-confidence vote in her. Mr Raab – a Leave supporter who was promoted to the cabinet to replace David Davis when he quit in protest at Mrs May’s Brexit plans – is among a group of senior ministers thought to be unhappy with the agreement.

He was closely involved in drafting the agreement, which sets out the terms of Britain’s departure from the EU. In his resignation letter, Mr Raab said he could not support it because the regulatory regime proposed for Northern Ireland “presents a very real threat to the integrity of the United Kingdom”. And, he added, the “backstop” arrangements aimed at preventing the return of a hard Irish border would result in the EU “holding a veto over our ability to exit”. “Above all, I cannot reconcile the terms of the proposed deal with the promises we made to the country in our manifesto at the last election,” he told the prime minister.

The BBC’s Norman Smith said Mr Raab’s departure puts pressure on other cabinet members to quit, raising the prospect of a “domino effect” that could end in the break-up of the cabinet. Remain-backing Conservative MP Anna Soubry tweeted: “Raab’s resignation marks the end of PMs Withdrawal Agreement. This is v serious the PM will clearly be considering her position. My own view is that we need a Govt of National Unity and we need it now.” Earlier on Thursday, Shailesh Vara quit as minister of state for Northern Ireland, saying he cannot support Mrs May’s agreement, which he said “leaves the UK in a halfway house with no time limit on when we will finally be a sovereign nation”.

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But this may turn out to be the main takeaway from May’s deal: opening up the option of a second vote.

Final Say Referendum On Table As May Blows Debate Wide Open (Ind.)

Theresa May has admitted Brexit can be stopped, with her senior officials accepting a new referendum on Britain’s departure from the EU is possible. The unprecedented admission from the top of government came as the prime minister revealed her cabinet had begrudgingly backed the draft Brexit deal struck by negotiators earlier this week. But speaking outside Downing Street, she issued a stark warning to Tory rebels that threats to tear down the proposals and her leadership could mean there is “no Brexit at all”. There are widespread claims that angry backbenchers are preparing to launch a bid to topple the prime minister within days, while speculation that cabinet ministers could still quit is rife.

Eurosceptics are likely to be further enraged by a clause in the 585-page draft deal allowing an unspecified extension to the Brexit transition – with the text simply saying it could run until “20XX”. Ms May emerged from the black door of No 10 to confirm tentative cabinet support following an intense five-hour cabinet meeting, at which almost 30 of her top ministers spoke. In a short statement she targeted a warning directly at those intent on bringing the deal down, saying: “When you strip away the detail, the choice before us is clear.

“This deal, which delivers on the vote of the referendum, which brings back control of our money, laws and borders, ends free movement, protects jobs, security and our union – or leave with no deal, or no Brexit at all.” Asked later how the PM felt there could be ‘no Brexit’, her spokesman said: “You should see that through the prism of parliament, in that the main opposition party has actively said that Brexit can be stopped, there is a People’s Vote movement which we have set out our opposition to, and any other number of important votes that will have to occur between now and the 29th of March.” It is the first time Downing Street has so clearly stated not only that Brexit is not a foregone conclusion, but that a new vote is possible.

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At what point can we label this “chaos”?

Brexit: A Split Cabinet, A Split Party And A Split Nation (G.)

Theresa May will launch a high-stakes battle to sell her Brexit deal to parliament on Thursday, after clinching the support of her deeply-divided cabinet during a fraught five-hour meeting in Downing Street. Emerging from No 10 on Wednesday night, May said she believed “with my head and my heart” that her deal was the best one for the UK – and the only alternatives were no deal, or no Brexit. She said her ministers had taken a “collective” decision, to press ahead with finalising the deal in Brussels, which she will then have to bring back to parliament for approval; but it was clear there had been significant dissent. There were a series of dissenting voices from Brexit supporting ministers, as the meeting overran its intended length by two hours.

One Whitehall source said the environment secretary, Michael Gove, had been the only leaver to speak in favour. “This is a decision that was not taken lightly, but I believe it is firmly in the national interest,” May said, adding that cabinet had held “a long, detailed and impassioned debate”. Cabinet sources said Esther McVey, the work and pensions secretary, made the most impassioned interventions against the draft agreement and warned of chaos should the government lose a meaningful vote in parliament. May twice refused a request from McVey to hold a vote in the room. One cabinet source said that McVey was “shouted down” by the cabinet secretary, Sir Mark Sedwill.

Liz Truss, the chief secretary to the Treasury, said they were “caught between the devil and the deep blue sea”. Up to 11 cabinet ministers were said to have spoken out against the deal. Supportive voices came from the communities secretary, James Brokenshire, and the education secretary, Damian Hinds. [..] The documents confirmed one key concession that has enraged Brexiters: the UK will not be able to unilaterally exit the Irish backstop. Instead that decision would rest with a joint, independent arbitration committee with an equal number of British and EU representatives, as well as outside members. The EU and the UK “decide jointly within the joint committee that [the backstop] … is no longer necessary,” the draft agreement said.

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“..May said that her deal would give us back “control of our money, laws and borders”, while protecting business and jobs. None of that is true. ”

Theresa May’s Brexit Deal Solves Nothing: Open Warfare Is About To Begin (G.)

Now the arm-twisting, the bribery and the for-the-good-of-the-country cajoling of every last MP begins in earnest. Pinned to the wall, each must finally reveal their true colours; some will be principled, some not: Tories must reckon if the future is with Theresa May and her deal, or with Brextremists in their constituencies. Any Labour would-be defector must reckon whether their local party could ever forgive them for voting to keep this government in power. Meanwhile, Brexit mis-selling continues unabated. In her statement this evening, May said that her deal would give us back “control of our money, laws and borders”, while protecting business and jobs. None of that is true. Nowhere is there any evidence to be found in the lengthy withdrawal deal.

For the foreseeable, we are in a customs union we cannot leave without EU permission and our borders are open to EU citizens. We are paying £39bn, business has no certainty for future investment and as for jobs – well, let’s just cross our fingers and hope. May pretends that some distant sunlit trade deal, hazily sketched, will one day emerge from the political declaration that accompanies the deal. Will it be in two years, 10 years, sometime, never? No one knows. All the devilish dilemmas remain. All the impossibilities are as impossible as they were on referendum day – but now they are solemnly written down on paper.

We can’t have frictionless EU trade without a customs union, but that stops us buccaneering the globe for those exclusive deals with Mauritania or wherever else Liam Fox chooses to turn to. Ireland stands where it did: preserving an open border, made possible by the Good Friday agreement, means the UK must stay close to the EU forever. Scotland is righteously rebelling: David Mundell, with his crucial 13 Scottish Tory votes in parliament, will not countenance continued EU rights to fish in our waters; Scotland’s first minister, Nicola Sturgeon, protests at Scotland being denied Northern Ireland’s competitive advantage of effectively staying in the single market – a special status the DUP also objects to. Today takes us closer to fracturing the union.

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Your guess is as good as the IMF’s. Contact your local bookmaker.

IMF Says No-Deal Brexit To Cause 8% Hit To UK Economy (Ind.)

The UK economy could face a long-run hit of up to 8 per cent of GDP in the event of a no-deal Brexit, the International Monetary Fund has warned. That’s the equivalent of around £6,000 per British household. “A scenario in which future trade between the UK and the EU is governed by [World Trade Organisation] rules is estimated to bring about output losses of around 5 to 8 percent compared to a no-Brexit scenario in the long run (with an average of about 6 per cent),” the IMF said. However its economists also warned that this assumed a smooth transition to WTO rules and that the impact of a chaotic no-deal Brexit in the short-term next March could be more severe, leading to a “sharp fall in asset prices”, a “hit to consumer and business confidence” and another sterling depreciation.

“Directors emphasised the importance of a timely agreement with the EU, accompanied by an implementation period to avoid a cliff-edge exit in March 2019 and to allow firms and workers time to adjust to the new relationship”. Delivering its full annual health check on the UK on Wednesday, the Washington-based Fund also said that the British economy would be around 3 per cent weaker even if it successfully secured a “Canada-style” free trade deal with the rest of the European Union “due to lower trade, migration and productivity”.

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6% is very low historically, and lethal today.

The Race To 6% Mortgage Rates (WS)

The average interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) and a 20% down-payment rose to 5.17% for the latest reporting week, according to the Mortgage Bankers Association (MBA) today. This is the highest average rate since September 2009 (chart via Investing.com): Many people with smaller down payments and/or lower credit ratings are already paying quite a bit more. Top-tier borrowers pay less. Thus, mortgage rates have moved a little closer to the next line in the sand, 6%, which is still historically low.

At that point, the interest rate would be back where it had been in December 2008, when the Fed was unleashing its program of interest rate repression even for long-dated maturities via QE that later included the purchase of mortgaged-backed securities (MBS), which helped push down mortgage rates further. Now the Fed is shedding Treasury securities and mortgage-backed securities, and we’re starting to see the impact on mortgage rates: The difference (spread) between the 10-year yield and the interest rate of the average 30-year fixed-rate mortgage has widened sharply.

Since the beginning of the year: The 30-year mortgage interest rate has risen 95 basis points, or nearly 1 percentage point (from 4.22% to 5.17%). The 10-year Treasury yield has risen 71 basis points (from 2.46% to 3.17%) The spread between the two has widened from 176 basis points on at the beginning of January to 200 basis points now. In other words, mortgage rates are climbing faster than the 10-year Treasury yield, now that the Fed has begun the shed mortgage-baked securities. This is expected. It’s part of the QE unwind – it’s part of the Fed exiting the mortgage market and pulling its support out from under it. But 6% is still low:

Home prices in many markets have risen far above the home prices back in 2008 and 2009, and far above even the local peaks during Housing Bubble 1 in those markets now that they have developed into a fully blooming Housing Bubble 2. Home prices as a whole averaged out across the US have surged 11.5% above the crazy peak of Housing Bubble 1:

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Good piece from Brandon Smith.

The Fed Will Continue Tightening Until Everything Breaks (Smith)

Fed propaganda asserts the lie that the bank is audited annually by the Government Accounting Office (GAO), but this is NOT an audit of Fed financial actions and policy initiatives. Rather, it is an audit of minor expenditures. Knowing how many pencils and desks the Fed purchases in a year does not help us to understand the bank’s influence over our economic security. All other audits of the Fed are done internally by the Fed’s own Board of Governors. This is hardly transparent or independent. The only time the public has gained access to even a partial government audit of Fed activities was during the audit of TARP. This alone exposed trillions of dollars in bailouts and overnight loans to various banks and corporations, many of which were foreign.

The GAO did nothing in terms of regulatory action against the Fed after it was revealed that they were funneling trillions in capital into foreign corporations. All they did was make a ledger of the transactions, and remained silent on the rest. I remind readers of this history and the conditions surrounding Fed actions because I want to drive the point home that, for now, the Fed and other central banks dictate the rules of the game. Some may say this has changed with the election of Donald Trump, but I disagree. If anything, as long as Trump is in office, the Fed will chase higher interest rates and steeper balance sheet cuts. They will not stop until markets break. And, the only solution (shutting down the Fed entirely) also comes with a set of extreme fiscal consequences.

There is a wall of cognitive dissonance when some in the public are confronted with this notion. They prefer to believe in a set of standard lies rather than accept that the Fed is a saboteur of our financial system.

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Big Tech’s ultimate power lies in their connections with US intelligence. Dangerous.

Amazon’s Long Game Is Clearer Than Ever (Taibbi)

The Washington Post seemed happy about Amazon’s decision to divide its new headquarters between New York and Crystal City, Virginia, outside of D.C., noting the amazing benefits both communities will receive by the arrival of the web-retail behemoth. The company expects to create 25,000 jobs in Northern Virginia by 2030, and generate $3.2 billion in tax revenue, in addition to investing $2.5 billion. Who better to trumpet the virtues of this job-creating, capital-investing deal than the richest person in modern history, Amazon CEO Jeff Bezos? He sounded pleased as heck to be part of all the wonderfulness.

“We are excited to build new headquarters in New York City and Northern Virginia,” Bezos told the Post — which he owns — adding: “The team did a great job selecting these sites, and we look forward to becoming an even bigger part of these communities.” Rather quickly after the “HQ2” announcement was made, MarketWatch ran a piece pointing out that moving to Northern Virginia might have other benefits for Amazon: HQ2 in the D.C. area could help Amazon snag a $10 billion Pentagon contract. Yes, the company has increased the odds that it will be awarded one of the all-time lucrative defense deals, the $10 billion Joint Enterprise Defense Infrastructure (JEDI) contract, providing cloud services and a platform for Department of Defense operations, instantly becoming one of the biggest federal contractors.

The deal has been a source of controversy for a while. In July, a pair of Republican members of Congress, Steve Womack of Arkansas and Tom Cole of Oklahoma, sent a letter to Glenn Fine, acting Inspector General of the Defense Department. In it, they claimed the contract was essentially pre-delivered to Amazon. Among other things, the JEDI award can only go to a provider that meets Defense Information Systems Agency Impact Level 6, a requirement that has to do with security/secrecy clearances. “The highest level of cloud security” is how one congressional source explained Level 6 to me. Although the lawmakers did not single out Amazon, they did say only one private provider meets that requirement, and numerous reports say that provider is Amazon Web Services.

Vanity Fair ran a piece this past summer noting other deal requirements — like a prerequisite of $2 billion in cloud revenue — ruled out all but a few competitors. “The deal appeared to be rigged in favor of a single provider,” the magazine wrote, adding that Amazon Web Services had ties to Trump Defense Secretary James Mattis. Amazon already had another recent win on the defense-contracting front with the passage of the so-called “Amazon Amendment,” which makes Amazon the go-to portal for the government’s online purchases. This was included in last year’s Defense Authorization Bill. That amendment will cover $53 billion in annual government purchases, enriching the firm even more.

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Why would anyone want one in their homes?

Amazon’s Alexa Might Be A Key Witness In A Murder Case (Vox)

Last week, a judge in New Hampshire ordered Amazon to hand over recordings of an Echo smart speaker found in the home where a double murder took place last year in Farmington. Authorities believe the recordings may provide information that could put the murderer behind bars. If Amazon does hand over the private data of its users to law enforcement, it won’t just involve the tech company in a murder case. It will also be the latest incident to raise serious questions about how much data tech companies collect about their customers with and without their knowledge, how that data can be used, and what it means for privacy.

Last January, Timothy Verrill was charged with first-degree murder by the New Hampshire attorney general in the deaths of two women, Christine Sullivan and Jenna Pellegrini. Police found the women’s bodies in the backyard of Sullivan’s boyfriend, Dean Smoronk, whom local New Hampshire media reported Verrill knew. Verrill was spotted on home surveillance video with both Sullivan and Pellegrini. He was also seen on video hours later buying cleaning supplies at a store and returning to the house. After Smoronk called 911 to report his girlfriend missing, police found the bodies and seized an Amazon Echo speaker in the kitchen, next to the spot where police believe Sullivan was killed.

According to AP, prosecutors believe the Echo might have useful information to make the case against Verrill, whose trial begins May 2019, including details about what happened during and after the murder, such as “possible removal of the body from the kitchen.” [..] While it’s entirely possible the Echo speaker will have nothing recorded that relates to the case, it also may very well have pertinent info. The speaker is initiated with four wake-up words — “Alexa”, “Echo,” “computer,” and “Amazon” — and records after hearing these words, even when it’s not being spoken to. These recordings are then stored on an Amazon server, accessible to the company, and to owners via the Alexa app.

There’s plenty of evidence that the devices record more than what Amazon says. After a woman in Portland found out that her Echo speaker had recorded a conversation she had with her husband and sent it to a random contact, Amazon admitted that its Alexa technology can misinterpret household noises like conversations, TV soundtracks, and music as wake-up calls and start recording. The speaker also starts recording a few seconds before a command is issued, meaning there’s likely more private information in the recordings than customers are aware of.

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US is preparing to sanction Turkey for not bying these boondoggles.

Lockheed Martin Awarded $22.7 Billion Pentagon Fighter Jet Contract (AFP)

The Pentagon on Wednesday announced it had awarded Lockheed Martin a $22.7 billion contract for 255 F-35 fighter jets. Of the aircraft, 106 are destined for the US military: 64 F-35As for the Air Force, 26 F-35Bs for the Marines, and 16 F-35Cs for the Navy, while the rest are destined for foreign customers, the department said in a statement. A major Pentagon supplier, Lockheed Martin will receive a $6 billion advance for the order, due to be completed in March 2023. Most of the work on the jets will be performed in the US, with some will be carried out in countries including Britain and Italy.

Launched in the early 1990s, the F-35 program is considered the most expensive weapons system in US history, with an estimated cost of some $400 billion and a goal to produce 2,500 aircraft in the coming years. Once servicing and maintenance costs for the F-35 are factored in over the aircraft’s lifespan through 2070, overall program costs are expected to rise to $1.5 trillion. According to Pentagon figures from early October, 320 F-35s have been delivered worldwide, including 245 in the US.

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Brilliant.

Japan Cyber Security Minister Admits He Has Never Used A Computer (AFP)

A Japanese minister in charge of cyber security has provoked astonishment by admitting he has never used a computer in his professional life, and appearing confused by the concept of a USB drive. Yoshitaka Sakurada, 68, is the deputy chief of the government’s cyber security strategy office and also the minister in charge of the Olympic and Paralympic Games that Tokyo will host in 2020. In parliament on Wednesday however, he admitted he doesn’t use computers. “Since the age of 25, I have instructed my employees and secretaries, so I don’t use computers myself,” he said in a response to an opposition question in a lower house session, local media reported.

He also appeared confused by the question when asked about whether USB drives were in use at Japanese nuclear facilities. His comments were met with incredulity by opposition lawmakers. “It’s unbelievable that someone who has not touched computers is responsible for cyber security policies,” said opposition lawmaker Masato Imai. And his comments provoked a firestorm online. [..] one Twitter user [..] joked that perhaps Sakurada was simply engaged in his own kind of cyber security. “If a hacker targets this Minister Sakurada, they wouldn’t be able to steal any information. Indeed it might be the strongest kind of security!”

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Oct 092018
 
 October 9, 2018  Posted by at 9:02 am Finance Tagged with: , , , , , , , , , , ,  


Ford Madox Brown Finding of Don Juan by Haidee 1873

 

 

World Leaders ‘Have Moral Obligation To Act’ After UN Climate Report (G.)
US Economists Win Nobel Memorial For Work On Climate And Growth (G.)
Nobel Prizes in Economics, Awarded and Withheld (NC)
The End Of The World Will Save Theresa May From Brexit (Ind.)
Stock Markets Stage Sharp Sell-Off Amid Fear Of Italy-EU Budget Fight (G.)
QE Party Is Drying Up, Even at the Bank of Japan (WS)
Higher Rates Will Hurt Stocks Far More Than You Think (SA)
Pakistan Seeks Bailout From IMF (WSJ)
IMF Not Concerned About China’s Ability To Defend The Yuan (R.)
Sharp Slowdown In Consumer Spending Cools UK Retail Sales (G.)
Google Drops Out Of Bidding For $10 Billion Pentagon Data Deal (R.)

 

 

Groundhog Day. They just want to get (re-)elected. Which won’t happen if they tell people to cut their driving and flying.

World Leaders ‘Have Moral Obligation To Act’ After UN Climate Report (G.)

World leaders have been told they have moral obligation to ramp up their action on the climate crisis in the wake of a new UN report that shows even half a degree of extra warming will affect hundreds of millions of people, decimate corals and intensify heat extremes. But the muted response by Britain, Australia and other governments highlights the immense political challenges facing adoption of pathways to the relatively safe limit of 1.5C above pre-industrial temperatures outlined on Monday by the IPCC. With the report set to be presented at a major climate summit in Poland in December, known as COP24, there is little time for squabbles. The report noted that emissions need to be cut by 45% by 2030 in order to keep warming within 1.5C.

That means decisions have to be taken in the next two years to decommission coal power plants and replace them with renewables, because major investments usually have a lifecycle of at least a decade. Mary Robinson, a UN special envoy on climate, said Europe should set an example by adopting a target of zero-carbon emissions by 2050. “Before this, people talked vaguely about staying at or below 2C – we now know that 2C is dangerous,” she said. “So it is really important that governments take the responsibility, but we must all do what we can.” The UK, which has gone further than most nations by cutting its annual emissions by 40% since 1990, will need to step up if the more ambitious goal is to be reached.

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Both think adapting to climate change is easy.

US Economists Win Nobel Memorial For Work On Climate And Growth (G.)

Two American economists at the forefront of work on climate change and the role of governments in boosting growth have been jointly awarded the prestigious Nobel Memorial prize for economics. The Royal Swedish Academy of Sciences said William Nordhaus and Paul Romer were being honoured for their research into two of the most “basic and pressing” economic issues of the age. Nordhaus made his name by warning policymakers during the first stirrings of concern about climate change in the 1970s that their economic models were not properly taking account of the impact of global warming and he is seen as one of the pioneers of environmental economics.

The Yale economist was honoured a day after the latest UN warning on global warming said that urgent and unprecedented changes were needed to keep climate change to a maximum of 1.5C (2.7F). The co-winner – Romer – is seen as the prime mover behind the endogenous growth theory, the notion that countries can improve their underlying performance if they concentrate on supply-side measures such as research and development, innovation and skills. [..] Responding to news of his award, Romer said it was perfectly possible for global warming to be kept to a maximum of 1.5C, in line with the latest recommendation of the UN Intergovernmental Panel on Climate Change. “Once we start to try to reduce carbon emissions, we’ll be surprised that it wasn’t as hard as we anticipated. The danger with very alarming forecasts is that it will make people feel apathetic and hopeless.

“One problem today is that people think protecting the environment will be so costly and so hard that they want to ignore the problem and pretend it doesn’t exist. Humans are capable of amazing accomplishments if we set our minds to it.” [..] Nordhaus has been a prominent advocate of the use of a uniformly applied carbon tax as the best way to put a true cost on the use of burning fossil fuels and so reducing greenhouse gas emissions. The committee that awarded the prize said he was the first person to design “simple but dynamic and quantitative models of the global economic-climate system, now called integrated assessment models (IAMs). “His tools allow us to simulate how the economy and climate would co-evolve in the future under alternative assumptions about the workings of nature and the market economy, including relevant policies.”

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This is useful h/t Yves. Peter Dorman on how Martin Weitzman, who has a far more aggressive take on economics and climate, was snubbed so Nordhaus’ light version would get the attention.

Nobel Prizes in Economics, Awarded and Withheld (NC)

Nordhaus was widely expected to be a winner for his work on the economics of climate change. For decades he has assembled and tweaked a model called DICE (Dynamic Integrated Climate-Economy), that melds computable general equilibrium theory from economics and equations from the various strands of climate science. His goal has been to estimate the “optimal” amount of climate change, where the marginal cost of abating it equals the marginal cost of undergoing it. From this comes an optimal carbon price, the “social cost of carbon”, which should be implemented now and allowed to rise over time at the rate of interest. In his first published work using DICE, from the early 1990s, he recommended a carbon tax of $5 a tonne of CO2, inching slowly upward until peaking at $20 in 2085. His “optimal” policy was expected to result in an atmospheric concentration of CO2 of over 1400 ppm (parts per million) at the end of this planning horizon, yielding global warming in excess of 3º C. (Nordhaus, 1992)

Over time Nordhaus has become slightly more concerned with the potential economic costs of climate change but also more sanguine about the prospects for decarbonized economic growth, even in the absence of policy. In his latest work he advocates a carbon tax of $31 per tonne in 2015, increasing at 3% per year over the following century. This too would result in more than 3º warming. To give a sense of how modest his suggestion is, consider that, in the same paper, Nordhaus calculates that the most efficient carbon tax to limit warming to 2.5º is between $107-184 per tonne depending on assumptions. The target of the Paris Accord is 2º, and most scientists consider this an upper bound for the amount of warming we should permit.

What do these “optimal” tax numbers mean? Based on the carbon content of gas, each $1 carbon tax translates into a one cent tax on a gallon of gas at the pump. If we adopted Nordhaus’ suggestion for carbon pricing, the result would be minuscule compared to the year-to-year fluctuations in energy prices due to other causes. In other words, while his prize is being trumpeted as a statement from the Swedish bankers on the importance of climate change, in fact he is a key spokesman for the position, rejected by nearly all climate scientists, that the problem is modest and can be solved by easy-to-digest, nearly imperceptible adjustments to energy prices. If we go down his road we face a significant risk of a climate apocalypse.

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The benefits of climate change.

The End Of The World Will Save Theresa May From Brexit (Ind.)

Brexit has been in its “something will turn up phase” for some time now and possibly, at last, something has. This is meant to be Theresa May’s “Hell Week”, with important post-Brexit proposals to be published in both Brussels and the UK, both of which will of course necessitate demented rows within her own party (current “strategies” include threatening to vote down the Budget), but Hell Week could hardly have got off to a better start. The most sensible reading of Hell Week is that it looks likely to end with May agreeing to keep the UK in the EU’s customs union until 2022. In the circumstances, the prime minister will not have failed to notice that, according to this morning’s report from the UN’s IPCC, that is a mere eight years before all of the planet’s inbuilt life preserving systems are currently scheduled to turn against humanity in act of vengeance that will be swift and total.

To borrow briefly from the probability-based lexicon of the climate science community, let’s take a look at the likelihood of Brexit being concluded by then in any meaningful way. Even in the unlikely event of Britain voting to leave the European Union, right up until around 8am on 24 June 2016, the latest point at which it was all meant to have been sorted out was 24 June 2018. But when David Cameron decided not to trigger the two-year Article 50 process “straight away” as he had consistently claimed he would, but resigned instead, that date was eventually pushed back by May to 29 March 2019, expanding Brexit by 37.5 per cent.

Then, in March 2018, the Brexit “transition period” was agreed to last until until 31 December 2020, and now, just seven months later, that deadline has been extended until the next general election in 2022, a further eighteen months. At the most conservative estimate, that gives Brexit a rate of expansion of around two hundred per cent, or four years for every two. If the depth to which it can be kicked into the long grass can be maintained on this exponential gradient, May has every reason to be optimistic that tornadoes of sulphuric gas will be moving freely over the Irish border long before she has to deliver any acceptable proposals for how to avoid the reintroduction of customs infrastructure across it.

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Not the only issue.

Stock Markets Stage Sharp Sell-Off Amid Fear Of Italy-EU Budget Fight (G.)

Global stock markets staged a sharp sell-off on Monday amid growing concerns over a budget showdown between Italy and the EU and the prospect of weaker growth in the Chinese economy. Italian borrowing costs jumped and the euro dropped on foreign exchanges as the war of words between Rome and Brussels escalated, while shares on Wall Street and other major international markets declined amid growing concerns over the US-China trade war. Italian bond yields jumped by as much as 30 basis points to the highest levels since early 2014 after the Italian deputy prime minister, Matteo Salvini, attacked the European commission president, Jean-Claude Juncker, and the economics commissioner, Pierre Moscovici, as enemies of Europe.

Speaking at a news conference with the French far-right leader Marine Le Pen, he said the country would not cave to pressure from the financial markets or retreat from its plan for government spending. “We are against the enemies of Europe — Juncker and Moscovici — shut away in the Brussels bunker,” he said. Brussels has told Italy it is concerned over the plan because it would mean the nation running a larger budget deficit – the gap between income from taxes and government spending – than previously planned for the next three years. Rome is to submit its draft budget to the commission, the EU’s executive arm, which will check whether it is in line with EU rules by 15 October.

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When the easy money goes, how do we keep the bubbles inflated?

QE Party Is Drying Up, Even at the Bank of Japan (WS)

As of September 30, total assets on the Bank of Japan’s elephantine balance sheet dropped by ¥5.4 trillion ($33 billion) from a month earlier, to ¥537 trillion ($4.87 trillion). It was the fourth month-over-month decline in a series that started in December. This chart shows the month-to-month changes of the balance sheet. Despite all the volatility, the trend since mid-2016 is becoming clear: Abenomics became the economic religion of Japan in later 2012, and “QQE” (Qualitative and Quantitative Easing) was an integral part of it. So has the “QQE Unwind” commenced? Are central bankers, even at the Bank of Japan, getting cold feet about the consequences?

At BOJ policy meetings, concerns have been voiced over the “sustainability” of the stimulus program, according to the minutes of the July meeting, released on September 25. So the BOJ staff “proposed measures to enhance the sustainability of the current monetary easing while taking into consideration, for example, their effects on financial markets.” And “flexibility” has been proposed as solution to those concerns. The minutes reiterated that the BOJ would continue to buy Japanese Government Bonds (JGBs) in “a flexible manner” so that its holdings would increase by about ¥80 trillion a year. But this is precisely what has not been happening, in line with this “flexibility.”

Over the past 12 months, the BOJ’s holdings of JGBs rose by “only” ¥26.2 trillion – not ¥80 trillion. And they declined in September from the prior month (more in a moment). Shortly after the minutes had been released, BOJ Governor Haruhiko Kuroda, once the most reckless among the money printers, changed his tune and said in a speech that, “in continuing with powerful monetary easing, we now need to consider both its positive effects and side-effects in a balanced manner.” The Fed has already whittled down its balance sheet by $285 billion since it started its QE unwind last October. The ECB has tapered its QE from a peak of buying €85 billion a month to buying €15 billion currently and will end it altogether in December. The discussion has switched to raising rates and unwinding QE.

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Like the graph.

Higher Rates Will Hurt Stocks Far More Than You Think (SA)

Federal Reserve Chair Jerome Powell thinks the economy is awesome. And he has no problem telling us so. What Powell will never discuss, however, is the “way-too-low-for-way-too-long” stimulus that the central bank engaged in to get here. In particular, the Fed has kept the neutral rate of interest far beneath the rate of inflation (CPI) for an entire decade. Consumers, corporations and Uncle Sam predictably borrowed as if there’d never be consequences. What consequences? Asset bubbles. Stocks, bonds, real estate, collectibles, cryptos, alternatives, everything. Straight across the Ouija board.

Perhaps ironically, we have seen this streaming video before. “Too-low-for-to-long” rate policy in the previous economic expansion (11/01-12/07) created an environment whereby the quality and the quantity of household mortgage debt became toxic. Granted, mortgage debt is less of an issue in the current credit cycle. Nevertheless, total household debt levels may not be sustainable at higher average interest costs. Meanwhile, the federal government is making households look downright responsible.

Long after the Great Recession ended, the country averaged $1.07 trillion in deficits (2010-2017). We’ve now hit $21.5 trillion in our national debt. Uncle Sammy’s bar tab won’t be getting smaller anytime soon. The new tax law, which has provided a near-term kick start for economic growth (GDP), will keep the trillion-dollar deficit train running for years to come. None of this would be so ominous were it not for the rapid-fire advance of interest expense. Interest expense alone accounts for 11% of the federal budget. Just interest. No debt repayment. Tack on higher interest rates to new borrowing needs? Pretty soon interest expense will surpass the money that goes to the Department of Defense (13.6%).

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Belt and Road. Silk Road.

Pakistan Seeks Bailout From IMF (WSJ)

Pakistan, the flagship country for China’s global infrastructure building initiative, said Monday that it needed a bailout from the International Monetary Fund, amid growing concerns that Beijing’s program is pushing recipient countries into financial crisis. The fiscal constraints of an IMF program would also undercut the promises made by Prime Minister Imran Khan’s new government, which include millions of new jobs and the establishment of a welfare state.

But a ballooning trade deficit and fast-depleting foreign exchange reserves left the Pakistani government no other choice, officials said, after markets were spooked by the government’s recent suggestions that it might try to make do without the fund. “Uncertainty was growing and the stock market was falling,” said Chaudhry Fawad Hussain, the Information Minister. “We decided to end the uncertainty.” The Pakistani request for an IMF loan could further test already-strained U.S.-China relations. In July, U.S. Secretary of State Mike Pompeo warned that the U.S. didn’t want to see any IMF lending to Pakistan “go to bail out Chinese bondholders or—or China itself.”

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Growing at 6.9%(?) and still in need of pretty extreme support. I’d be concerned.

IMF Not Concerned About China’s Ability To Defend The Yuan (R.)

IMF Chief Economist Maurice Obstfeld said on Tuesday that he was not concerned about the Chinese government’s ability to defend its currency despite the recent depreciation of the yuan. “No, I don’t think it’s a problem,” Obstfeld said when asked about the issue on the sidelines of a news conference at the IMF and World Bank annual meetings in Bali. But Obstfeld also told the news conference that Beijing would face a “balancing act” between actions to shore up growth and ensure financial stability. China’s yuan currency has faced strong selling pressure this year, losing over 8% between March and August at the height of market worries, though it has since pared losses as authorities stepped up support.

On Tuesday, China’s central bank fixed the yuan’s official mid-point for trading at 6.9019 per dollar, edging close to the psychologically important 7.0 barrier and helping to send Asian stocks to a 17-month low. A U.S. Treasury official on Monday repeated that the Trump administration was concerned about the yuan’s recent weakening as the department prepares a semi-annual report on currency manipulation due out next week. Obstfeld said financial markets have overly emphasized short-term movements in China’s currency, adding that the yuan has often quickly recovered from periods of volatility in recent years.

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Reading this, I kept thinking: what sharp slowdown? Where is it? Not in the numbers…

Sharp Slowdown In Consumer Spending Cools UK Retail Sales (G.)

Britain’s retailers experienced a sharp slowdown in consumer spending last month, bringing to a close the World Cup-inspired summer spree on the high street. According to the British Retail Consortium (BRC) and the accountancy firm KPMG, growth in total sales dropped to the weakest level in almost a year. Total sales grew at an annual rate of 0.7% in September, compared with 2.3% growth during the same month a year ago. The BRC said this was the lowest growth rate since October 2017. Excluding new store openings, like-for-like sales dropped by 0.2% in the year to September, compared with a 19.9% increase for the same period a year ago.

The latest snapshot for the retail sector comes before the important autumn and winter shopping periods, vital for industry profits, when sales of gifts and electrical goods are lifted by the Black Friday sales event in November and shoppers buying Christmas presents. Retailers have been hit hard by a combination of problems that have led to job cuts and store closures across Britain. The ongoing shift to online shopping has increased competition, while sluggish wage growth and high levels of inflation have damaged the spending power of British households. Sales of stationery, footwear and clothing fell last month, while retailers sold more computers, jewellery, furniture, home accessories and food.

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If this doesn’t scare you…

Google Drops Out Of Bidding For $10 Billion Pentagon Data Deal (R.)

Alphabet Inc’s Google said on Monday it was no longer vying for a $10 billion cloud computing contract with the U.S. Defense Department, in part because the company’s new ethical guidelines do not align with the project, without elaborating. Google said in a statement “we couldn’t be assured that [the JEDI deal] would align with our AI Principles and second, we determined that there were portions of the contract that were out of scope with our current government certifications.” The principles bar use of Google’s artificial intelligence (AI) software in weapons as well as services that violate international norms for surveillance and human rights.

Google was provisionally certified in March to handle U.S. government data with “moderate” security, but Amazon.com Inc and Microsoft Corp have higher clearances. Amazon was widely viewed among Pentagon officials and technology vendors as the front-runner for the contract, known as the Joint Enterprise Defense Infrastructure cloud, or JEDI. Google had been angling for the deal, hoping that the $10 billion annual contract could provide a giant boost to its nascent cloud business and catch up with Amazon and fellow JEDI competitor Microsoft. That the Pentagon could trust housing its digital data with Google would have been helpful to its marketing efforts with large companies. But thousands of Google employees this year protested use of Google’s technology in warfare or in ways that could lead to human rights violations.

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Sep 022018
 
 September 2, 2018  Posted by at 9:16 am Finance Tagged with: , , , , , , , , , ,  


Salvador Dali Portrait of Picasso 1947

 

Is The US Economic Boom Beginning To Fizzle Out? (Coppola)
Former Eurogroup Head Dijsselbloem Says Demands On Greeks Were Too Heavy (R.)
The IMF Abetted The European Union’s Subversion Of Greek Democracy (Mody)
Ethiopia Debt Woes Curtail China Funding (R.)
May Vows No Compromise With EU On Brexit Plan (BBC)
Pentagon Cancels Aid To Pakistan Over Record On Militants (R.)
Monsanto-Bayer: Eliminating The Name Will Not Erase The Criminal History (CD)
What’s Happening To Our Weather? The Answers Are Hiding In Arctic Air (G.)

 

 

Bit short today. I think because all the focus is one two funerals I don’t care much about. In one, a bishop grabs boobs, in the other the one person not invited gets all the attention.

Is that a surprise?

Is The US Economic Boom Beginning To Fizzle Out? (Coppola)

President Trump is not going to be too happy with the New York Fed’s latest nowcast for Q3 2018. The staff projection, based upon the latest data, shows annualized quarter-on-quarter GDP growth slowing to 2% per annum. At the end of 2017 it was 4%, and even at the end of Q2 it was 3%.

The Atlanta Fed’s nowcast, which calculates GDP growth in the same way as the U.S. Bureau of Economic Analysis, also shows GDP growth slowing in Q3, though from a higher level. The Atlanta Fed’s growth estimate for Q3 is 4.1%. President Trump will no doubt be happy with this, but not so happy with the fact that at the beginning of August the estimate was 5%.

So what has gone wrong? Why are the nowcasts suggesting that U.S. economic growth is beginning to slow? The indicators that go into the NY Fed’s nowcasts have been gradually turning red for some time now. There appears to be something of a downturn going on in the housing market; both new starts and sales have fallen. Exports have fallen and imports have risen, apparently because of worsening terms of trade, most likely due to the strong dollar. Most recently, manufacturers have drawn down inventories, and there is a fall in orders and shipments for durable goods. There are no dramatic drops, but it all adds up to a gradual economic slowdown.

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How long have you realized this, Jeroen, and what have you done to repair it?

Former Eurogroup Head Dijsselbloem Says Demands On Greeks Were Too Heavy (R.)

Euro zone countries have asked for too much from the Greek people in return for international bailout loans, former Eurogroup chief Jeroen Dijsselbloem said in an interview on Dutch television on Saturday. “On reforms, we have asked a lot from the Greek people, too much,” Dijsselbloem told current affairs program Nieuwsuur. “Reforms are hard enough to accomplish in a society with a well-functioning government, but this was obviously not the case in Greece.” Greece emerged from the biggest bailout in economic history on Aug. 20, after receiving 288 billion euros in financial aid since 2010, with the European Union as its biggest lender.

During the crisis, the Greek economy shrank by a quarter, pushing a third of the population into poverty and driving thousands to move abroad. “Greece is obviously not a success story,” Dijsselbloem said. “Their crisis has been so deep, that you can’t call it a success.” Dijsselbloem chaired the Eurogroup of euro zone finance ministers from 2013 until the beginning of 2018, and led dozens of lengthy emergency meetings during which bailouts for Greece, Cyprus and the Spanish banking sector were grudgingly pieced together.

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Sister act.

The IMF Abetted The European Union’s Subversion Of Greek Democracy (Mody)

European authorities never allowed a conversation around the core imperative of reducing Greece’s debt burden. Syriza formed a government on January 25, 2015. On January 31, Erkki Liikanen, governor of Finland’s central bank and, in that capacity, a member of the ECB’s Governing Council, threatened that the ECB would stop funding Greek banks if the Greek government did not agree to the terms of the creditors. And on February 4, the ECB decided Greece’s fate. In an aggressive move that took everyone by surprise, the ECB cut off funding to Greek banks, preemptively immobilizing the Greek government before it could begin negotiations with its creditors.

The ECB withdrew an earlier arrangement under which Greek banks used their government bonds as collateral (security) to obtain funds for running their day-to-day operations. Although Greek government bonds had a junk rating and normally only higher-rated bonds qualified as collateral, the ECB had waived that requirement to help the banks stay afloat. With its February 4 decision, the ECB revoked that waiver. Greek banks could now borrow only from the Greek central bank under an Emergency Liquidity Arrangement (ELA); ELA funds carried a higher interest rate and, moreover, could be turned off at any time, thus choking the Greek financial system.

Stock prices of Greek banks fell sharply, and two days later, the rating agency S&P pushed the government bonds’ rating further into junk territory. With continuing deposit flight from Greek banks and the threat of a financial meltdown, the Syriza government rapidly lost all leverage before it could use its economic argument in a political negotiation.

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More Belt and Road.

Ethiopia Debt Woes Curtail China Funding (R.)

Ethiopia has been lauded by experts from China’s ruling Communist Party as a “model country” in Beijing’s $126 billion Belt and Road initiative to build rail, road and sea links tying China to Eurasia and Africa. But as the Horn of Africa nation of 100 million people faces debt distress, there are signs that China, a major creditor, is slowing financing to Ethiopia as doubts grow over the profitability of some infrastructure projects there. “The intensifying repayment risks from the Ethiopian government’s debt reaching 59 percent of GDP is worrying investors,” China’s mission to the African Union in Addis Ababa said on its website in July.

It said that Chinese investment in the country was cooling and that the China Export and Credit Insurance Corp was reducing the scale of its investment there. Against a backdrop of rising worry over African indebtedness to China, Prime Minister Abiy Ahmed will visit Beijing for the Forum on China-Africa Cooperation (FOCAC), which starts on Monday. He is due to meet Chinese Prime Minister Li Keqiang and is expected to court investment from Chinese firms into Ethiopia’s agro-industrial and pharmaceutical businesses, China’s Xinhua news agency said. Ethiopia has been a top destination for Chinese loans in Africa, despite its lack of natural resources, with state policy banks extending it more than $12.1 billion since 2000, according to the China Africa Research Initiative (CARI) at the Johns Hopkins School of Advanced International Studies in Washington (SAIS).

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Not your call, Theresa.

May Vows No Compromise With EU On Brexit Plan (BBC)

Theresa May has insisted she will not be forced into watering down her Brexit plan during negotiations with the EU. Writing in the Sunday Telegraph, the prime minister says she will “not be pushed” into compromises on her Chequers agreement that are not in the “national interest”. But Mrs May also warns she will not “give in” to those calling for a second referendum on the withdrawal agreement. She says it would be a “gross betrayal of our democracy and… trust”. The People’s Vote, a cross-party group including some MPs, is calling for a public vote on the final Brexit deal. The UK is on course to leave the EU on 29 March and the government had previously ruled out another referendum.

The prime minister writes that the coming months are “critical in shaping the future of our country”, but that she is “clear” about her mission in fulfilling “the democratic decision of the British people”. She adds that following the Chequers agreement in July – which led to the resignation of two cabinet ministers – “real progress” has been made in Brexit negotiations. While there is more negotiating to be done, Mrs May writes: “We want to leave with a good deal and we are confident we can reach one.” The government has been preparing for a no-deal scenario, even though this would create “real challenges for both the UK and the EU” in some sectors, she says. But the PM adds: “We would get through it and go on to thrive.”

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Just as they’ve voted in Imran Khan, who once suggested he might order the shooting down of U.S. drones if they entered Pakistani airspace, [and] has opposed the United States’ open-ended presence in Afghanistan.

Pentagon Cancels Aid To Pakistan Over Record On Militants (R.)

The U.S. military said it has made a final decision to cancel $300 million in aid to Pakistan that had been suspended over Islamabad’s perceived failure to take decisive action against militants, in a new blow to deteriorating ties. The so-called Coalition Support Funds were part of a broader suspension in aid to Pakistan announced by President Donald Trump at the start of the year, when he accused Pakistan of rewarding past assistance with “nothing but lies & deceit.” The Trump administration says Islamabad is granting safe haven to insurgents who are waging a 17-year-old war in neighboring Afghanistan, a charge Pakistan denies. But U.S. officials had held out the possibility that Pakistan could win back that support if it changed its behavior.

U.S. Defense Secretary Jim Mattis, in particular, had an opportunity to authorize $300 million in CSF funds through this summer – if he saw concrete Pakistani actions to go after insurgents. Mattis chose not to, a U.S. official told Reuters. “Due to a lack of Pakistani decisive actions in support of the South Asia Strategy the remaining $300 (million) was reprogrammed,” Pentagon spokesman Lieutenant Colonel Kone Faulkner said. Faulkner said the Pentagon aimed to spend the $300 million on “other urgent priorities” if approved by Congress. He said another $500 million in CSF was stripped by Congress from Pakistan earlier this year, to bring the total withheld to $800 million. The disclosure came ahead of an expected visit by U.S. Secretary of State Mike Pompeo and the top U.S. military officer, General Joseph Dunford, to Islamabad. Mattis told reporters on Tuesday that combating militants would be a “primary part of the discussion.”

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8,000 lawsuits. And Bayer is not a US company, big difference.

Monsanto-Bayer: Eliminating The Name Will Not Erase The Criminal History (CD)

Cancelling out Monsanto’s name and keeping only that of Bayer, does not mean forgetting the wrongdoings of a company which, according to the verdict of the Monsanto Tribunal of The Hague, is stained with crimes of ecocide. With Bayer’s official takeover of Monsanto, the giant multinational also inherits its liabilities. On the eve of the start of the integration process, Monsanto has been held liable for causing cancer through the use of its glyphosate-based weedkiller Roundup and ordered to pay $289 million of damages to the plaintiff Dewayne Lee Johnson in the first landmark case, settled in California in mid August 2018. The jury also found that Monsanto “acted with malice or oppression.”

According to Reuters, the number of lawsuits brought against Bayer’s newly acquired Monsanto is approximately 8000 in the US alone. UN experts Ms Hilal Elver, Special Rapporteur on the right to food and Mr. Dainius Puras, Special Rapporteur on the right to physical and mental health, defined the ruling “a significant recognition of the human rights of victims, and the responsibilities of chemical companies.” Revelations in reports published last year, most notably the “Monsanto Papers” and the “Poison Papers“, have shed light on strategies of big agrochemical groups to expand their empires: from lobbying, interference in government agencies’ proceedings, attacks in collusion with institutions on independent science, to mega mergers and acquisitions.

For the first time part of these documents were shown to a jury, which were able, among other things to also see that, “at least starting 20 years ago, Monsanto has known that their product can cause cancer, and has gone out of its way to ignore it and/or fight any science that suggests a link”, as declared to Democracy Now by Brent Wisner, the lead trial counsel for Dewayne Lee Johnson in his lawsuit against Monsanto. Added to this, in the same week, California’s Supreme Court rejected a challenge by Monsanto to the state’s decision to include glyphosate in its Proposition 65 list of carcinogens.

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How clean is the air?

What’s Happening To Our Weather? The Answers Are Hiding In Arctic Air (G.)

I am standing on the ocean. Ahead of me, the world is split into two perfect halves: blue sky above, white sea ice below. The view is clean and simple, but a continuous waltz of swirling and shunting is hidden inside those two colours: the inner workings of the Arctic engine. This place is special for many reasons, and to appreciate one of the most unusual all I need to do is to live; to breathe. The air is -2C, but the air coming from my lungs is invisible. The familiar wisps of cold breath that I associate with crisp winter air in Britain are absent. They cannot form here. And that anomaly is connected in a fundamental way to our presence here, on a scientific expedition to study this environment. For two months, the Swedish icebreaker Oden is home to 74 of us, living and working at the top of the world to tap into the stories that the blue and the white have to tell.

The Arctic has held on to its mystique for centuries. Many western explorers have pitted their wits, strength, and endurance against this environment, while traditional Arctic communities have learned to work with the complexities of the ice rather than against them. Those of us who live well south of the Arctic circle hear a lot about how the white in the north is changing, but less about how it is. It’s hard to construct a secondhand mental image of what it’s like here. There are no landmarks and you cannot step in the footprints of the past. This is an ocean with an icy shell that cracks and shifts as it’s pushed by the wind, breaking apart into separate floes or piling up to form ridges.

Read more …

Apr 182018
 
 April 18, 2018  Posted by at 5:21 pm Finance Tagged with: , , , , , , , , ,  


Francesco Hayez The Death of the Doge Marin Faliero 1867

 

 

Dr. D’s swift response to my essay yesterday, Every Kingdom Divided Against Itself. On the mechanisms by which empires fall. They’re always similar and familiar.

 

 

Dr. D: Wonderfully said. Since no one will report, here’s what happened to that airstrike. The one where we declare a victory and go home (or try to).

They targeted 10 sites, yet after the Pentagon said it was a perfect mission, they only reported on 4. Who were the other 6?


Duwali airbase – 4 missiles fired, 4 shot down
Dumayr airbase – 12 missiles fired, 12 shot down
Baley airbase – 18 missiles fired, 18 shot down
Shayrat airbase – 12 missiles fired, 12 shot down
Marj Ruhayyil airbase – 18 missiles fired, 18 shot down
Damascus international airport – 4 missiles fired, 4 shot down

Sounds like an amazing ad for Russian military hardware and Russian alliances, and an amazing warning to warhawks in the Pentagon to check themselves.

And hold on: wouldn’t bombing a major chemical weapons manufacturing facility lead to a cloud of nerve and/or other gas killing every civilian within 20 miles? I.e. the entire capital city? Or did they know that there was nothing there already which is why they were confident it could not lead to an incident that would be recorded as the worst chemical attack of all time? You know, chemically attacking 1.7 million Syrians to save 10 Syrians from chemical attacks?

Yet this illegal, reckless, and (intentionally?) futile attack is NOT ENOUGH for CNN, MSNBC and their ilk. Denouncing Trump for bombing Syria, they also denounced him for NOT bombing Syria. Adequately. Or fully mobilizing the entire U.S. military for a ground invasion.

Or whatever, as weasel-faced chicken hawks, they wouldn’t openly say what they wanted, only that Trump openly bombing a nation outside the U.N. without a declaration of war as they themselves demanded, was pointless and weak. Which is why they also wanted it, in side-by-side front page articles? Or like Veruca Salt they want a pony AND an oompa loompa?

 

This IS weak, and like the late Soviet Union, it IS divided, no one IS in charge, clearly, as we see: the FBI, Justice, Pentagon, CIA, all make it a point of honor to openly, proudly disobey direct orders from their boss, and with him their real employer, the American people who elected him. And which they worked tirelessly to election tamper and deny and/or remove him.

And that’s perfectly okay with everybody. Is that normal for everyone in a business, a platoon, to directly countermand all direct orders? It is these days, and not just with Trump. Once you throw off the Logos, every man does what is right in his own eyes, they are not restrained by petty law and custom, by order and precedent, for they will be as the most high.

This is as true down at Taco Bell as in Federal Court, in the Justice Department, true in police departments, schools, hospitals, and even public lavatories. Order, rules, are whatever some official wants them to be during the 5 minutes they meet you. An hour later, the rules, your punishment, even their description of reality itself is all different. Railroad one guy: it’s legal, commendable! Railroad the next guy? It’s draconian, the death penalty.

Look at someone wrong? Have an opinion? Lose your life, liberty, property, reputation and career. A Celebrity? Poor dear: no matter how many felonies, how many killed, or how often wrong, it never matters. Not just saying that, the number of police acquitted for killing unarmed citizens exceeds Parkland by leagues. And this licence is given not just to judges and investigators but by the people themselves.

 

We have an Emperor Nero or early Robespierre government. There is no logic in them. No Logos. When you expel Logos actively, joyfully, you get the anti-Logos: pure random chaos, disorder, violence, and death. No one can work with anyone, trust anyone, restrain anyone, work together, or plan. You get the Reign of Terror and the purges of the Lion’s Mouths under the Council of Ten.

This was well engineered to bring down the U.S. in a repeat of the Russian Revolution of 1918, and it’s going relatively well. When the people themselves have no order, it’s hard enough to hold the people. But when the government doesn’t either, and fights itself while lying, there’s less hope than ever.

Because while government can be reformed, it takes generations of work to re-instill the Logos, rules, law, customs, order, consequences, back into the people. Sometimes it seems nothing can purge them of these delusions of theft and power but fire.

But one way or the other, we’re in it now. The Civil War is at home. Syria is just an example of our domestic war. Remember the L.A. Times reporting the CIA-imbedded resistance openly shooting the Pentagon-imbedded Kurds? Two agencies killing each other with bullets? That went on every day before and since, politically, socially, economically, and now militarily.

The airstrike in Syria — real or fake — is that war. A war of order and law vs unrestrained will-to-power. And that battle of Logos and anti-Logos is worldwide.

 

 

Apr 052018
 
 April 5, 2018  Posted by at 12:11 pm Finance Tagged with: , , , , , , , , , , , , ,  


Herbert Ponting Scott’s Terra Nova Expedition, Antarctica 1911

 

Something must be terribly wrong with the world. A few days ago Elizabeth Warren agreed with Trump on China, now Bernie Sanders agrees with him about Amazon. What’s happening?

 

Bernie Sanders Agrees With Trump: Amazon Has Too Much Power

Independent Vermont senator and 2016 presidential hopeful Bernie Sanders echoed President Donald Trump in expressing concern about retail giant Amazon. Sanders said that he felt Amazon had gotten too big on CNN’s “State of the Union” Sunday, and added that Amazon’s place in society should be examined.

“And I think this is, look, this is an issue that has got to be looked at. What we are seeing all over this country is the decline in retail. We’re seeing this incredibly large company getting involved in almost every area of commerce. And I think it is important to take a look at the power and influence that Amazon has,” said Sanders.

A backlash against Facebook, a backlash against Amazon. Are these things connected? Actually, yes, they are connected. But not in a way that either Trump or Sanders has clued in to. Someone who has, a for now lone voice, is David Stockman. Here’s what he wrote last week.

 

The Donald’s Blind Squirrel Nails An Acorn

It is said that even a blind squirrel occasionally finds an acorn, and so it goes with the Donald. Banging on his Twitter keyboard in the morning darkness, he drilled Jeff Bezos a new one – or at least that’s what most people would call having their net worth lightened by about $2 billion:

“I have stated my concerns with Amazon long before the Election. Unlike others, they pay little or no taxes to state & local governments, use our Postal System as their Delivery Boy (causing tremendous loss to the U.S.), and are putting many thousands of retailers out of business!” You can’t get more accurate than that. Amazon is a monstrous predator enabled by the state, but Amazon’s outrageous postal subsidy – a $1.46 gift card from the USPS stabled on each box – isn’t the half of it.

The real crime here is that Amazon has been exempted from making a profit, and the culprit is the Federal Reserve’s malignant regime of Bubble Finance. The latter has destroyed financial discipline entirely and turned the stock market into the greatest den of speculation in human history. That’s why Bezos can kill established businesses with impunity.

The casino allows him to run a pernicious business model based on “price to destroy”, rather than price for profit and a return on capital. Needless to say, under a regime of sound money and honest capital markets Amazon would be a far more benign economic creature. That’s because no real investors would value AMZN’s money-loosing e-Commerce business at $540 billion – nor even a small fraction of that after 25-years of profitless growth.

The bubble economy, the everything bubble, that we have been forced into, with QE, ultra-low rates, central banks buying trillions in what at least used to be assets, and massive buybacks that allow companies to raise their ‘value’ into the stratosphere, has enabled a company like Amazon to kill off its competition, which consists of many thousands of retailers, that do have to run a profit.

It’s a money scheme that allows many of the most ‘valuable’ tech companies to elbow their way into our lives, in ways that may seem beneficial to us at first, but in reality will only leave us behind with much less choice, far less competition, and many, many fewer jobs. Once it’s done someone will mention ‘scorched earth’. But for now they are everybody’s darlings; they are, don’t you know, the tech giants, the brainchildren of the best that the best among us have to offer.

They don’t all work the exact same way, which may make it harder to recognize what they have in common. For some it’s easier to see than for others. It’s also difficult to list them all. Here’s a few: Apple, Amazon, Facebook, Google (Alphabet), Tesla, Uber, Airbnb, Monsanto. Let’s go through the list.

 

Apple ? Yes, Apple too. But they make real things! Yes, but just as Apple CEO Tim Cook seeks to distance his company from the likes of Facebook on morals and ethics, he can’t deny that Apple sells a zillion phones to a large extent because everybody uses them to look at Facebook and Alphabet apps until their faces are blue. If data ethics are the only problem Cook sees, he’s in trouble.

Silicon Valley infighting shows that the industry does have an idea what is going wrong, in ways that should have already led to many more pronounced worries and investigations.

 

Silicon Valley Rivals Take Shots At Facebook

Mr. Cook, who has long sought to differentiate Apple on privacy matters, contrasted its focus on selling devices with Facebook and Google’s ad-based businesses that are built on user data. Asked what he would do if he were Facebook CEO Mark Zuckerberg, Mr. Cook replied: “I wouldn’t be in this situation.”

[..] Days earlier, François Chollet, an artificial intelligence engineer at Google, sought to draw a line between his company and Facebook. He tweeted that Google products like search and Gmail help users “to do more, to know more.” Facebook’s newsfeed, he wrote, “manipulates your worldview and seeks to maximally waste your time.”

[..] In January, Salesforce.com CEO Marc Benioff, whose company sells business software services, said that the addictive nature of social media means it should be regulated like a health issue.“I think that you do it exactly the same way that you regulated the cigarette industry,” Mr. Benioff told CNBC when asked how Facebook should be regulated. Some of the most cutting rebukes have come from people who know Facebook well.

In November, Sean Parker, the founding president of Facebook, said that Facebook executives, including himself, were “exploiting a vulnerability in human psychology” by designing a platform built on social validation. Mr. Parker didn’t respond to a request for comment.

Facebook generally hasn’t responded to the criticism, but it did after sharp comments from its former vice president of growth, Chamath Palihapitiya. “The short-term, dopamine-driven feedback loops that we have created are destroying how society works,” Mr. Palihapitiya said at a talk at Stanford University in November.

I would expect to hear a lot more of that sort of thing. Big Tech is changing the world in more ways than one. And spying on people Facebook-style is merely one of a long list of them. So yes, Apple certainly also belongs in that list. Facebook doesn’t build the devices people use to see what their friends had for breakfast, Apple does that. Moreover, Apple profits hugely from stock buybacks, so it fits in Stockman’s bubble finance definition of Amazon, too.

The failure of politics to investigate, and act against, those dopamine-driven feedback loops which exploit a vulnerability in human psychology in order to maximally waste your time and sell you product after product that you never (knew you) wanted is downright bizarre. Politicians only started talking about Facebook when a topic connected to Trump and Russia was linked to it.

 

Amazon: Trump can’t act fast enough on the tax situation and the US Postal deal. Not that that will solve the issue. Amazon, like all the companies on my list, can only be cut down to size if and when the everything bubble is. They are, after all, its children.

The most pernicious aspect of the Amazon ‘business model’, which all these firms share, and all are able to live by thanks to the central banks and the “greatest den of speculation in human history” they have created, is the prospect of world domination in their respective fields. They all hold in front of speculators the promise that they can crush all competition, or nearly all. Scorched earth, flat earth.

 

Facebook: their place in the list is obvious. What is it, 2.5 billion users? And what they don’t have is divvied up between them and Google when they buy up apps like Instagram. Officially competitors, but they have the exact same goals. And, like me, you may think: what’s the problem, just ban them from collecting all that data. Facebook has no reason to know, at least not one that serves us, where you were last Friday, and with whom. And just in case you missed that bit, they do.

But there their connection to the intelligence world comes in. Their platforms are better than anything the NSA has ever been able to develop. So we can say we don’t want Zuckerberg and Alphabet spying on us, but our own spies do want to do just that. That makes any kind of backlash much harder to succeed. And it doesn’t matter if you delete your Facebook account, they’ll find you anyway. Friend of a friend. We all have friends who are on Facebook, rinse and repeat.

The only hope there is, with Facebook as with the other companies, is for investors and speculators to dump their holdings in massive numbers. And that will only happen when the central bank Ponzi collapses. And it will, but by then we have a whole new set of problems.

 

Google: largely the same set of issues that Facebook has. Its tentacles are everywhere. Former CEO Eric Schmidt’s connections to the Pentagon should be really all you need to know. The EU may have issued all sorts of complaints and fines on competition grounds, but that makes no difference.

The one country with an effective response to Google and Facebook is China, that has largely banned both and built its own versions of their products. Which allows Beijing to ban people from boarding planes, buying homes etc., if their ‘social credit’ is deemed too low. If you want to be scared about where Big Tech’s powers can lead, look no further.

 

Tesla: Elon Musk has built a fantasy (and maybe I should put Paypal in this list too) on what everyone thinks must be done to ‘save the planet’ (yeah, build cars…) by grossly overstating the number of cars he can build, and financing his growth on not only speculation, but also on spectacular amounts of government subsidies (politicians want to save the planet, too).

And now he needs additional financing again. He will probably get it, again, but the Amazon backlash might have people take another look. One fine day… Fits David Stockman’s complaint to a t(ee), doesn’t have to make a profit. Musk has perfected that model.

 

Uber and Airbnb: why anyone anywhere would want to send money generated in their community, by renting out cars and apartments in that same community, to a bunch of people in Silicon Valley, is beyond me. Someone should set this up as an international effort that makes it easy for a community, a city etc., to provide this kind of service and make the profits benefit their own cities.

But like Amazon, they are free to run any competition into the ground because no profits are required until they have conquered the world. And then they can go nuts. It may look like a business model, but it isn’t. It’s a soon to be orphaned bubble child..

 

Monsanto: less obvious perhaps as an entry in the Big Tech list, but very much warranting a spot. And of course it stands for the entire chemical-seeds field. From Agent Orange to your children’s dinner plate. Monsanto has more lawyers and lobbyists on its payroll than it has scientists, but then its lofty goals outdo even those of Google or Amazon.

Facebook may focus on your addiction to human contact, but Bayer, DuPont, Syngenta et al have decided to make your food so addicted to their chemicals that they will in the future profit from every bite served on your table. How they will grow that food long term without any insects, bees or birds left is unclear, but they don’t seem to care much. As for profits? Monsanto seeks to rule the world, and for now care as little about profits as they do about insects.

 

Zuckerberg may claim that he only wants to improve Facebook’s service, but when that is done through for instance the 2012 so-called Transmission of Anger experiment in which the company tried to alter their users’ emotional states -and succeeded-, by manipulating their friends’ postings, that claim becomes pure ridicule. Selling off user data to scores of developers doesn’t help either. But do you see Congress tackling him in any serious way next week? Neither do I.

Because there’s one huge catch to the scenario that David Stockman -and I- painted, of the whole tech bubble collapsing when the financial bubble does. It is the links tech companies have built to intelligence. A group of Google employees wrote a letter to their CEO Sundar Pichai to protest the company’s involvement in “weaponized AI”, in the shape of Project Maven, a military surveillance engine to-be.

These people undoubtedly mean well, but they’re far too late. They will have to leave the “don’t be evil” company to actually not be evil. Because it’s not a big step from weaponized AI to killer robots. Microsoft is also part of the project, and Amazon is. If you work there and don’t want to be evil, you know what to do.

Yeah, it’s about our safety, and security, and political and military and economic power. But it’s also about spying on people, in even worse ways than Facebook does. So even as the central bank bubble, and the tech bubble, go poof, some of these companies may be saved by their military ties.

That sound you hear is George Orwell turning in his grave.

 

 

Dec 112017
 
 December 11, 2017  Posted by at 10:27 am Finance Tagged with: , , , , , , , , , ,  


MC Escher Balcony 1945

 

Bitcoin Futures Top $18,000, Soar 20% From Open – Halted for Second Time (ZH)
Investors Told to Brace for Steepest Rate Hikes Since 2006 (BBG)
The Struggle To Maintain The “Standard Of Living” (Roberts)
China Audit Finds Provinces Faked Data and Borrowed Illegally (BBG)
Markets Tell You What To Do If You Listen (Peters)
UK Seeking ‘Canada Plus Plus Plus’ EU Trade Deal (BBG)
Brexit’s Just A Distraction To The Real Problem: UK’s Clapped-Out Economy (G.)
Poland Risks Being the EU’s Rogue State (BBG)
Pentagon To Undergo First Ever Audit (ZH)
‘A Christmas Carol’, Money, Debt, and Success (MW)
Mass Starvation Is Humanity’s Fate (Monbiot)
Monsanto Offers Cash To US Farmers Who Use Controversial Chemical (R.)

 

 

You don’t have to own bitcoin anymore to bet on it.

Bitcoin Futures Top $18,000, Soar 20% From Open – Halted for Second Time (ZH)

Update: At 10:05pm ET, the CFE halted trading in Cboe Bitcoin Futures (XBT), in accordance with CFE Rule 1302(i)(ii) which defines the threshold for the halt as a 20% surge. XBT will re-open for trading approximately five (5)minutes from the time of the halt. Bitcoin Futures have topped $18,000 for the first time… It was reopened at 10:10pm ET. All of which is odd because Bob Pisani and the rest of the mainstream said that the opening of Bitcoin Futures would bring about the demise of the cryptocurrency due to the ability to short?

Update: At precisely 8:31pm ET, the CBOE instituted the first ever XBT trading halt, which lasted for two minutes according to a notice on Cboe’s website. XBT contracts have since resumed trading. As a reminder, the Cboe can halt trading for 2 minutes after 10% swings, and 5 minutes at 20%, an attempt to prevent wild swings.

Read more …

Things are a-changing.

Investors Told to Brace for Steepest Rate Hikes Since 2006 (BBG)

Wall Street economists are telling investors to brace for the biggest tightening of monetary policy in more than a decade. With the world economy heading into its strongest period since 2011, Citigroup Inc. and JPMorgan Chase & Co. predict average interest rates across advanced economies will climb to at least 1 percent next year in what would be the largest increase since 2006. As for the quantitative easing that marks its 10th anniversary in the U.S. next year, Bloomberg Economics predicts net asset purchases by the main central banks will fall to a monthly $18 billion at the end of 2018, from $126 billion in September, and turn negative during the first half of 2019. That reflects an increasingly synchronized global expansion finally strong enough to spur inflation, albeit modestly.

The test for policy makers, including incoming Federal Reserve Chair Jerome Powell, will be whether they can continue pulling back without derailing demand or rocking asset markets. “2018 is the year when we have true tightening,” said Ebrahim Rahbari, director of global economics at Citigroup in New York. “We will continue on the current path where financial markets can deal quite well with monetary policy but perhaps later in the year, or in 2019, monetary policy will become one of the complicating factors.” A clearer picture should form this week when the Norges Bank, Fed, Bank of England, European Central Bank and Swiss National Bank announce their final policy decisions of 2017. They collectively set borrowing costs for more than a third of the world economy. At least 10 other central banks also deliver decisions this week.

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Again, from an article with much more info and many more graphs.

The Struggle To Maintain The “Standard Of Living” (Roberts)

Economic cycles are only sustainable for as long as excesses are being built. The natural law of reversions, while they can be suspended by artificial interventions, cannot be repealed. More importantly, while there is currently “no sign of recession,” what is going on with the main driver of economic growth – the consumer? The chart below shows the real problem. Since the financial crisis, the average American has not seen much of a recovery. Wages have remained stagnant, real employment has been subdued and the actual cost of living (when accounting for insurance, college, and taxes) has risen rather sharply. The net effect has been a struggle to maintain the current standard of living which can be seen by the surge in credit as a percentage of the economy.

To put this into perspective, we can look back throughout history and see that substantial increases in consumer debt to GDP have occurred coincident with recessionary drags in the economy. No sign of recession? Are you sure about that?

There has been a shift caused by the financial crisis, aging demographics, massive monetary interventions and the structural change in employment which has skewed the seasonal-adjustments in economic data. This makes every report from employment, retail sales, and manufacturing appear more robust than they would be otherwise. This is a problem mainstream analysis continues to overlook but will be used as an excuse when it reverses. Here is my point. While the call of a “recession” may seem far-fetched based on today’s economic data points, no one was calling for a recession in early 2000 or 2007 either. By the time the data is adjusted, and the eventual recession is revealed, it won’t matter as the damage will have already been done. As Howard Marks once quipped: “Being right, but early in the call, is the same as being wrong.”

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You need an audit for that?

China Audit Finds Provinces Faked Data and Borrowed Illegally (BBG)

China found some local governments inflated revenue levels and raised debt illegally in a nationwide audit, a setback for Beijing in its bid to boost the credibility of economic data after a run of scandals. Ten cities, counties or districts in the Yunnan, Hunan and Jilin provinces, as well as the southwestern city of Chongqing, inflated fiscal revenues by 1.55 billion yuan ($234 million), the National Audit Office said in a statement on its website dated Dec. 8. Of that, 1.24 billion yuan was from the Wangcheng district in the provincial capital of Hunan, where officials faked the ownership transfer of local government buildings to boost income. The inspection, which covered the third quarter, also found that five cities or counties in the Jiangxi, Shaanxi, Gansu, Hunan and Hainan provinces raised about 6.43 billion yuan in debts by violating rules, such as offering commitment letters.

The findings are a blow to China’s bid to rein in data fraud, which has been widespread in some of the poorer provinces where officials were incentivized to inflate the numbers as a way of advancing their careers. Concern from investors wanting to be able to trust data out of the world’s second-largest economy led to the government trying to crack down on the practice, with President Xi Jinping saying in March that data fraud “must be throttled,” according to the state-run Xinhua News Agency. Rigid stability in provincial data on growth and employment has long sparked questions from economists, with the rust-belt province of Liaoning, in China’s northeast, famously admitting back in January that it had fabricated fiscal data from 2011 to 2014. Some regions and cities in Jilin province and Inner Mongolia also falsified reports, the Communist Party said in June, without providing details.

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“Near the highs, few opportunities exist to earn substantial returns, so you should take little risk..”

Markets Tell You What To Do If You Listen (Peters)

Anecdote” “What are the odds we come across an opportunity in the coming 4yrs to earn 20%?” the investor asked his team. “High,” they answered. “The odds are 100%,” he said, having seen this movie a few times. “So our cost of capital is 5% per year (20% divided by 4yrs), plus the 1% we earn on cash,” he said. His team nodded. “Under no circumstances should we deploy capital unless it earns well more than 6% per year from here on out.” It made sense. “What do we see that earns more than this hurdle?” he asked. His team’s list was as short today as it was long in 2016, 2011, 2009, 2003, 1998, 1997, 1994, 1992, 1990, 1987, etc. Today’s few opportunities have much in common with previous peaks: negative convexity, complexity, illiquidity, leverage, and/or all the above. “Investors confuse a 7.5% average annualized return target with a 7.5% annual return target,” he explained. “They’re entirely different things.”

Targeting average annualized returns allows you to accept what the market gives you, while targeting annual returns forces you to leverage investments near peak valuations to hit your bogey. “Typical pension and endowment boards want incoming investment returns to consistently exceed outgoing flows.” So most investors attempt to produce the highest return every year, no matter what it takes. “But that’s the wrong objective. Never underestimate the value of cash and patience in achieving the real goal; superior returns over the complete cycle,” he explained. “Markets tell you what to do if you listen,” he said. “Near the highs, few opportunities exist to earn substantial returns, so you should take little risk. Near the lows, opportunities to earn attractive returns are abundant.” You should take a lot of risk. “This sounds simple because it is. It’s obvious. But obvious is not easy.”

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But Canada says no.

UK Seeking ‘Canada Plus Plus Plus’ EU Trade Deal (BBG)

Britain wants a trade deal with the European Union that includes the best parts of the bloc’s agreements with Japan, Canada and South Korea, along with financial services, Brexit Secretary David Davis said, showing optimism a pact can be struck within a year. The chances of the U.K. leaving the EU without a deal, defaulting to World Trade Organization rules, have “dropped dramatically,’’ Davis said in a BBC TV interview on Sunday. Still, he signaled the painstaking agreement struck on Friday to end the first phase of Brexit negotiations isn’t binding, and that Britain’s exit payment of as much as 39 billion pounds ($52 billion) is contingent on reaching a free-trade agreement. Doing so, he said, “is not that complicated.”

“We start in full alignment: we start in complete convergence with the EU, so we then work it out from there,” Davis said on the Andrew Marr Show. “What we want is a bespoke outcome: We’ll probably start with the best of Canada, the best of Japan and the best of South Korea and then add to that the bits that are missing, which is services,” he said. “Canada plus plus plus would be one way of putting it.” The Brexit secretary’s bullishness belies the noise coming from his counterparts in the EU. It’s taken eight months of at times bitter haggling to make sufficient progress on what was supposed to be the easiest part of the talks – resolving Britain’s exit payment, its future border with Ireland, and the rights of EU and U.K. citizens living in each other’s territories.

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Don’t think I ever heard clapped-out before.

Brexit’s Just A Distraction To The Real Problem: UK’s Clapped-Out Economy (G.)

As Brexiteers shout “forward” and remainers chant “ back”, the battle over the EU dominates British politics. Yet it obscures a more basic British problem. Our clapped-out economy, brilliant at consumption, poor at production, is becoming unviable. A “nation of shopkeepers” has become a nation of shoppers, dependent on debt. Deindustrialisation and misguided economic policies have reduced the former workshop of the world to a level where Britain can neither pay its way, nor afford the defence and public services an advanced society needs. Everything in which we once were leaders – ships, railways, TV, great bridges, nuclear plants, bicycles, textiles, clothing, even Kit Kats – we now import.

We consume more than we produce, leading to an annual balance of payments deficit rising above 6% of GDP, financed by borrowing and selling companies, property and citizenship to survive. The result is a sluggish economy (a growing proportion of which is owned by foreigners); low productivity (because the manufacturing sector has shrunk to one-tenth of GDP); and static pay, as every sector except finance cuts costs to survive. Being in or out of the EU has little relevance to this basic problem. The EU is a market, not a mutual support system. Instead of redistributing growth to succour laggards it punishes them, as it has Greece. It drains us and proscribes the techniques of nurture by state aid, protectionism and devaluation by which Germany and France grew. Its “aid” is just our own money back, with the EU’s heavy costs taken out.

Even worse, Germany’s huge surpluses mean that deficit countries like the UK, with our £60bn-plus trade deficit, are compounded by the single market. Yet coming out offers no solution either. It generates uncertainty and deters investment. Most of world trade is controlled by multinationals, and Britain would be more vulnerable to their ministrations. Tory Brexiteers aim at turning us, down and dirty, into a low-wage, deregulated, cost-cutting tax haven-on-Thames. Hardly acceptable to an electorate that has already endured decades of that. The only solution is to rebalance an economy excessively dependent on finance and services by widening the manufacturing and production base and making it competitive. Neither free trade nor the single market will do that.

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The EU is going to make this ugly. It’s the only thing they know how to do.

Poland Risks Being the EU’s Rogue State (BBG)

Behind the noise of Brexit negotiations, the talk in the EU this year has been that there’s potentially a bigger problem in the east. And the prospect of another rupture looks to be increasing. Poland’s de facto leader, Jaroslaw Kaczynski, hand-picked his second prime minister in two years, opting last week for western-educated Finance Minister Mateusz Morawiecki as he seeks to boost the economy after revamping the judicial system. He is another Kaczynski acolyte who has backed the increasingly authoritarian Law & Justice party’s push to seize more control of the courts, a plan condemned by the European Parliament and European Commission The mood in Brussels is that EU institutions can no longer stand by and watch a country that’s the biggest net recipient of European aid thumb its nose without paying some sort of price. Few people are discussing Poland following Britain out of the bloc, but a protracted conflict is getting more likely.

Concerns about the shift in Poland triggered calls to limit access to EU funds for countries disrespecting the democratic rule of law. At a ministerial meeting on Nov. 15 in Brussels, the issue was raised during a discussion about the 2021-2028 budget by countries including Germany, France and the Nordic states, according to two EU officials with knowledge of the matter. Poland’s refusal to take in mainly Muslim refugees was referred last week to the European Court of Justice along with Hungary and the Czech Republic. “There is a growing feeling in Brussels that solidarity cannot be a one-way street, and that it becomes difficult to justify the 10 billion-euro per year net transfers for a country that is increasingly at odds with the bloc’s values,” said Bruno Dethomas, a senior policy adviser at GPLUS consultancy in Brussels and a former EU ambassador to Poland. “It is high time the EU reacted, or it risks losing its soul.”

Poles are accustomed to their government stirring up nationalist fervor with blistering attacks on the EU while welcoming the policies of U.S. President Donald Trump. It’s railed against taking in Muslim refugees, claimed the country has been enslaved and snapped at criticism of its power grab this year. But even by Kaczynski’s standards, his speech on Nov. 10 to mark Independence Day pulled no punches. It’s up to Poles to show “the sick Europe of today the path back to health, to fundamental values, to true freedom and to the strengthening of our civilization based on Christianity,” he said.

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How confident are you in this audit?

Pentagon To Undergo First Ever Audit (ZH)

After decades of waste, overpayments, trillions of missing or improperly accounted for dollars, and most recently losing track of 44,000 US soldiers, the Pentagon is about to undergo its first audit in history conducted by 2,400 auditors from independent public accounting firms to conduct reviews across the Army, Navy, Air Force and more – followed by annual audits going forward. The announcement follows a May commitment by Pentagon comptroller David Norquist, who previously served as the CFO at the Department of Homeland Security when the agency performed its audit. “Starting an audit is a matter of driving change inside a bureaucracy that may resist it,” Norquist told members of the Armed Services Committee at the time when pressed over whether or not he could get the job done at the DHS.

According to the DoD release: “The audit is massive. It will examine every aspect of the department from personnel to real property to weapons to supplies to bases. Some 2,400 auditors will fan out across the department to conduct it, Pentagon officials said. “It is important that the Congress and the American people have confidence in DoD’s management of every taxpayer dollar,” Norquist said. -defense.gov”. The Pentagon is no stranger to criticism over serious waste and purposefully sloppy accounting. A DoD Inspector General’s report from 2016 – which appears to be unavailable on the DoD website (but fortunately WAS archived)- found that in 2015 alone a staggering $6.5 trillion in funds was unaccounted for out of the Army’s budget, with $2.8 trillion in “wrongful adjustments” occurring in just one quarter.

In 2015, the Pentagon denied trying to shelve a study detailing $125 billion in waste created by a bloated employee counts for noncombat related work such as human resources, finance, health care management and property management. The report concluded that $125 billion could be saved by making those operations more efficient. On September 10th, 2001, Secretary of Defense Donald Rumsfeld announced that “According to some estimates we cannot track $2.3 trillion in transactions,” after a Pentagon whistleblower set off a probe. A day later, the September 11th attacks happened and the accounting scandal was quickly forgotten.

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Dickens was a big spender how had little.

‘A Christmas Carol’, Money, Debt, and Success (MW)

Karl Marx was so broke in 1859 he couldn’t afford the postage stamps to mail off his new manuscript, leading the philosopher to lament, “I don’t suppose anyone has ever written about ‘money’ when so short the stuff.” He was probably right about that. However, the most famous book about money written by someone strapped for cash wasn’t “Das Kapital” or “The Communist Manifesto.” It was “A Christmas Carol.” Charles Dickens suffered not only a personal-finance crisis but a creative one, as well, in the fall of 1843, when, in a sort of literary Hail Mary pass, he committed to writing a Christmas book in an impossible six weeks. And, in a plot twist as improbable as anything he himself could have come up with, this gambit actually worked: “A Christmas Carol” became one of the best-selling and most widely adapted books of all time, a work that shaped the very meaning of the holiday itself, and singlehandedly wiped out the goose market — more on that later.

This remarkable tale, recounted in Les Standiford’s biography, “The Man Who Invented Christmas,” and just turned into a highly entertaining new movie of the same name starring Dan Stevens and Christopher Plummer, holds financial lessons for everyone, especially those of us who’ve been tormented by the ghosts of bills past due and deadlines soon to come. Dickens was in debt: to begin with. There is no doubt whatever about that. Sales of his two most recent novels were so disappointing that his publishers cut his pay. Meanwhile, the 31-year-old author and social-justice warrior had just moved into a larger, and much more expensive, home to accommodate the birth of his fifth child (like Marx, his pecuniary troubles stemmed somewhat from the age-old failure to live within one’s means).

On top of all this, his relatives, including his chronically deadbeat dad, kept hitting him up for money. His father, who later inspired the beloved character Wilkins Micawber in “David Copperfield,” was so hopeless with money that Dickens rented his parents a cottage far out in the country, where he hoped it would be harder for them to overspend. For Dickens this was all kind of galling because he had been working so hard and he didn’t have much to show for it,” said Declan Kiely, curator of a terrific ongoing exhibit on Dickens at the Morgan Library in New York. When Scrooge berates his cheerful nephew Fred, “What’s Christmas time to you but a time for paying bills without money; a time for finding yourself a year older, but not an hour richer?” that could just as well have been Dickens ranting.

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How inevitable is this?

Mass Starvation Is Humanity’s Fate (Monbiot)

[..] to keep pace with food demand, farmers in south Asia expect to use between 80 and 200% more water by the year 2050. Where will it come from? The next constraint is temperature. One study suggests that, all else being equal, with each degree celsius of warming the global yield of rice drops by 3%, wheat by 6% and maize by 7%. These predictions could be optimistic. Research published in the journal Agricultural & Environmental Letters finds that 4C of warming in the US corn belt could reduce maize yields by between 84 and 100%. The reason is that high temperatures at night disrupt the pollination process. But this describes just one component of the likely pollination crisis. Insectageddon, caused by the global deployment of scarcely tested pesticides, will account for the rest. Already, in some parts of the world, workers are now pollinating plants by hand. But that’s viable only for the most expensive crops.

[..] Because they tend to use more labour, grow a wider range of crops and work the land more carefully, small farmers, as a rule, grow more food per hectare than large ones. In the poorer regions of the world, people with fewer than five hectares own 30% of the farmland but produce 70% of the food. Since 2000, an area of fertile ground roughly twice the size of the UK has been seized by land grabbers and consolidated into large farms, generally growing crops for export rather than the food needed by the poor. While these multiple disasters unfold on land, the seas are being sieved of everything but plastic. Despite a massive increase in effort (bigger boats, bigger engines, more gear), the worldwide fish catch is declining by roughly 1% a year, as populations collapse. The global land grab is mirrored by a global sea grab: small fishers are displaced by big corporations, exporting fish to those who need it less but pay more.

About 3 billion people depend to a large extent on fish and shellfish protein. Where will it come from? All this would be hard enough. But as people’s incomes increase, their diet tends to shift from plant protein to animal protein. World meat production has quadrupled in 50 years, but global average consumption is still only half that of the UK – where we eat roughly our bodyweight in meat every year – and just over a third of the US level. Because of the way we eat, the UK’s farmland footprint (the land required to meet our demand) is 2.4 times the size of its agricultural area. If everyone aspires to this diet, how exactly do we accommodate it? The profligacy of livestock farming is astonishing. Already, 36% of the calories grown in the form of grain and pulses – and 53% of the protein – are used to feed farm animals. Two-thirds of this food is lost in conversion from plant to animal. A graph produced last week by Our World in Data suggests that, on average, you need 0.01m2 of land to produce a gram of protein from beans or peas, but 1m2 to produce it from beef cattle or sheep: a 100-fold difference.

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Monsanto is the no.1 risk to our food. Presented as our savior.

Monsanto Offers Cash To US Farmers Who Use Controversial Chemical (R.)

Monsanto will give cash back to U.S. farmers who buy a weed killer that has been linked to widespread crop damage, offering an incentive to apply its product even as regulators in several U.S. states weigh restrictions on its use. The incentive to use XtendiMax with VaporGrip, a herbicide based on a chemical known as dicamba, could refund farmers over half the sticker price of the product in 2018 if they spray it on soybeans Monsanto engineered to resist the weed killer, according to company data. The United States faced an agricultural crisis this year caused by new formulations of dicamba-based herbicides, which farmers and weed experts say harmed crops because they evaporated and drifted away from where they were sprayed. Monsanto says XtendiMax is safe when properly applied.

The company is banking on the chemical and soybean seeds engineered to resist it, called Xtend, to dominate soybean production in the United States, the world’s second-largest exporter. BASF SE and DowDuPont also sell versions of dicamba-based herbicides. Monsanto’s cash-back offer comes as federal and state regulators are requiring training for farmers who plan to spray dicamba in 2018 and limiting when it can be used. Weed specialists say the restrictions make the chemical more costly and inconvenient to apply, but Monsanto’s incentive could help convince farmers to use it anyway.

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