Jan 232019
 
 January 23, 2019  Posted by at 9:45 am Finance Tagged with: , , , , , , , , , , , , ,  


Pablo Picasso The classical head 1922

 

 

David Attenborough And Prince William Urge World Leaders On Environment (G.)
The Super Rich At Davos Are Scared Of Ocasio-Cortez’s Tax Proposal (CNBC)
EU Fossil Fuel Subsidies Still At The Same Level As 2008 (G.)
Shutdown Reveals Most Americans Are Unprepared For The Next Recession (MW)
Unusually Large Drop In US Home Sales Has Real Estate Agents Baffled (CNBC)
Moonwalking with Theresa May: Unboxing Brexit ‘Plan C’ (George Galloway)
Companies Press Brexit Panic Button In Further Blow To Theresa May (G.)
Britain ‘Could Triple State Aid For Industry Under EU Rules’ (G.)
France And Germany Take Major Step Toward EU Army (ZH)
Trump Won’t Soften Hardline On China To Make Trade Deal (R.)
Chinese App ‘Live-Shames’ Debtors Within 500-Meter Radius (ZH)
‘Never Good News Having Particles in Your Brain’ (Spiegel)

 

 

This curious spectacle of the rich and famous pretending to tackle a crisis. As I was filing this article, Bloomberg ran a headline for a live event that went: “Bono and Christine Lagarde Discuss How to Address Income Inequality”

David Attenborough And Prince William Warn World Leaders On Environment (G.)

Sir David Attenborough has warned that humankind has the power to exterminate whole ecosystems “without even noticing”, and urged world leaders to treat the natural world with respect, during an interview with Prince William in Davos. Prince William also took world leaders to task at the World Economic Forum in Switzerland, asking Attenborough why those in key positions have “taken so long” to address climate change. Attenborough said the connection between the natural world and urban societies had been “remote and widening” since the industrial revolution, meaning humans do not realise the effect their actions have on the global ecosystem. The 92-year-old broadcaster added that it was “difficult to overstate” the urgency of the environmental crisis.

“We’re now so numerous, so powerful, so all-pervasive, the mechanisms we have for destruction are so wholesale and so frightening, that we can actually exterminate whole ecosystems without even noticing it. We have to now be really aware of the dangers of what we’re doing, and we already know that of course the plastic problem in the seas is wreaking appalling damage upon marine life, the extent of which we don’t yet fully know.” He stressed that the natural world “is not just a matter of beauty, interest and wonder” but a coherent ecosystem on which we depend for “every breath we take, every mouthful of food we take.” A healthy planet, Attenborough added, is an essential part of human life. “If we don’t recognise the kind of connections I’ve been describing, then the whole planet comes in hazard, and we are destroying the natural world and with it ourselves.”

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Catchy headline, but… She’ll be whistled back any time now. Can’t steal Kamala’s, or Warren’s, or Bernie’s headlights.

“I do think a system that allows billionaires to exist when there are parts of Alabama where people are still getting ringworm because they don’t have access to public health is wrong..”

The Super Rich At Davos Are Scared Of Ocasio-Cortez’s Tax Proposal (CNBC)

The elite financiers attending the World Economic Forum are worried about the 70 percent tax rate on earnings above $10 million proposed by freshman Rep. Alexandria Ocasio-Cortez, D-N.Y. “It’s scary,” Scott Minerd, global chief investment officer for $265 billion Guggenheim Partners, said in an interview. “By the time we get to the presidential election, this is going to gain more momentum,” said Minerd, who added that he would probably be personally impacted by it. “And I think the likelihood that a 70 percent tax rate, or something like that, becomes policy is actually very real.”

The billionaires and millionaires attending Davos had misgivings about Ocasio-Cortez’s proposal, which she made during a recent interview on CBS’ “60 Minutes.” A poll found that 59 percent of voters were in favor of the idea, and even 45 percent of Republicans liked it. The lawmaker has turned heads in Washington and on Wall Street with her left-wing economic rhetoric, despite only being sworn into office earlier this month. Ocasio-Cortez, who represents parts of Queens and the Bronx, identifies as a Democratic-Socialist. In Davos, Stephen Schwarzman, the billionaire CEO of private equity giant Blackstone and Republican megadonor, said sarcastically that he is “wildly enthusiastic” about the lawmaker’s proposed tax hike. He added that “the U.S. is the second most progressive tax regime in the world,” meaning that tax rates climb along with higher incomes.

The remarks at Davos came a day after Ocasio-Cortez had even more harsh words about how the U.S. economy works. “I do think a system that allows billionaires to exist when there are parts of Alabama where people are still getting ringworm because they don’t have access to public health is wrong,” she said at a New York event on Martin Luther King Day. Ocasio-Cortez addressed this article in a tweet Tuesday. “It’s wild that some people are more scared of a marginal tax rate than the fact that 40% of Americans struggle to pay for at least one basic need, like food or rent,” she wrote.

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They all talk green in Davos. But this is what they actually do. Your politicians won’t save the planet.

EU Fossil Fuel Subsidies Still At The Same Level As 2008 (G.)

The UK leads the European Union in giving subsidies to fossil fuels, according to a report from the European commission. It found €12bn (£10.5bn) a year in support for fossil fuels in the UK, significantly more than the €8.3bn spent on renewable energy. The commission report warned that the total subsidies for coal, oil and gas across the EU remained at the same level as 2008. This is despite both the EU and G20 having long pledged to phase out the subsidies, which hamper the rapid transition to clean energy needed to fight climate change. Germany provided the biggest energy subsidies, with €27bn for renewable energy, almost three times the €9.5bn given to fossil fuels.

Spain and Italy also gave more subsidies to renewable energy than fossil fuels. But along with the UK, France, the Netherlands, Sweden and Ireland all gave more to fossil fuels. The report is based on 2016 Eurostat data, the latest available, and found that across the EU renewable energy received 45% of subsidies and fossil fuels 33%. The commission report said policies were being pursued to cut carbon emissions and meet the Paris climate agreement goals of limiting global warming to well below 2C above pre-industrial levels. “However, despite this and the international commitments made in the context of G20 and G7, fossil fuel subsidies in the EU have not decreased,” it said. “EU and national policies might need to be reinforced to phase out such subsidies.”

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We already knew that. It’s just one more sign.

Shutdown Reveals Most Americans Are Unprepared For The Next Recession (MW)

The government shutdown, the longest in history, comes with a hidden revelation: Millions of Americans are financially unprepared for the next economic downturn. Worse, they are highly vulnerable, with few protections available to them. Ten years after the financial crisis, the economic recovery has left millions behind with little to no savings, and the government shutdown serves as a preview for what will happen once unemployment rises from 50-year lows. Within just a few weeks into the government shutdown, people are struggling to cope. [..] Why do a few weeks without pay turn into a crisis for many families? Simple: Nearly 80% of Americans live paycheck to paycheck. That’s a problem when you have little to no savings. In fact, it’s akin to playing financial Russian roulette.

And the problem is terrifyingly pervasive. According to a recent GoBankingRates survey, only 21% of Americans have more than $10,000 in savings, with nearly 60% having less than $1,000 in savings. This savings-free game of complacency works as long as people have a steady paycheck coming in and as long as interest rates stay low. But they are not staying low, even though the Federal Reserve may be patient again this year, as it has proclaimed in recent days. As a matter of fact, the cost of carrying debt, especially the revolving credit-card type, have exploded higher since the Fed tempered rate increases. Think I’m exaggerating? How about this: Interest rates on credit cards by commercial banks are now as high as they were in 2000:

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Baffled by the obvious.

Unusually Large Drop In US Home Sales Has Real Estate Agents Baffled (CNBC)

Real estate brokers are trying to figure out why sales of existing homes plunged in December. The 6.4 percent monthly move was unusually large, regardless of direction. The tally from the National Association of Realtors generally moves in the very low single digits month to month. In fact, the shift was one of the largest that didn’t involve some sort of change in government policy, like the homebuyer tax credit. “The latest decline is harder to explain. Perhaps it is the decline in consumer confidence that’s been occurring in the latter half of 2018,” said Lawrence Yun, chief economist for the Realtors. “The latest numbers do not reflect the lower, current mortgage rates compared to the November figures, so it’s really harder to explain.”

The supply of homes for sale also rose just more than 3 percent compared with a year ago. Low supply had been holding sales back last spring, despite strong demand, so it would make sense that more supply would boost sales, unless this is a sign that demand is weakening. “This weakness is certainly due to the sharp home price gains along with the rise in mortgage rates,” said Peter Boockvar, CIO at Bleakley. Affordability has been blamed for slower sales over the past six months, but sales in December matched the same pace as in 2000, and Yun argues that affordability is better now. “Today it is actually more affordable compared to year 2000, yet we have about 20 million more jobs, so for home sales to be roughly equivalent means that in 2018 there is an underperformance of the overall housing sector.”

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A very useful set of numbers from Galloway. As I said yesterday: the first to jump party lines wins. 200 Tories and 100 Labours want no Hard Brexit and no general election. Throw in fringe parties and you have a solid majority. Call it a national government.

Moonwalking with Theresa May: Unboxing Brexit ‘Plan C’ (George Galloway)

There are 317 Conservative MPs. At least 100 of them are Brexiteers who would never go quietly into the good night of the current political dispensation. But 200 of them conceivably could if it meant: a) avoiding a “Hard-Brexit” and b) avoiding a General Election. There are 256 Labour MPs. Most of them hate the idea of Brexit and many of them equally hate the idea of a General Election, which would bring their own leader to power. Mindful though that MacDonald became a historic by-word for treachery in the labor movement and that “all over the country Labour people turned his portrait to face the wall” in the wake of his betrayal, let’s imagine 100 of the current crop of Labour MPs “doing a MacDonald” and betraying their banner. That gives us a hypothetical 300 MPs in a House of 650.

That makes them the “biggest party” in the house by far and with a claim to the Speaker and the Queen for recognition as the “Government” of the UK. When you factor in the support (assured) of the 11 Liberal Democrats the 35 Scottish Nationalists (if their deal was right) the 8 independents, (assured) the 4 Welsh Nationalists (assured) the one Green MP (assured) and the assured abstention from the House of the 7 Sinn Fein MPs (Irish Republicans who cannot swear allegiance to the Queen and thus cannot take their seats) this would give the “National Government” bloc 359 MPs in a House of effectively 640 (650 less 7 SF and 3 Speakers and Deputy Speakers) A much more “strong and stable” government than Theresa May could even dream off. Their purpose – canceling Brexit.

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What took them so long?

Companies Press Brexit Panic Button In Further Blow To Theresa May (G.)

The scale of no-deal panic gripping major companies has been thrown into sharp focus by a series of damage-limitation announcements, as corporate Britain signalled it is running out of patience with Westminster gridlock. Sir James Dyson, the Brexit-backing billionaire, dealt a further blow to the government by revealing he is shifting his company headquarters to Singapore in a move that drew sharp criticism. Dyson’s decision to move his HQ out of the UK came on a day in which a series of high-profile names revealed measures to mitigate the impact of a disorderly departure from the EU:

• P&O announced that its entire fleet of cross-Channel ferries will be re-registered under the Cypriot flag, as the 182-year-old British maritime operator activated its Brexit plans. • Sony confirmed it is moving its European headquarters from London to Amsterdam. • The chief executive of luxury carmaker Bentley said the company was stockpiling parts and described Brexit as a “killer” threatening his firm’s profitability. • Retailers Dixons Carphone and Pets at Home announced plans to shore up supplies in the event of chaos at British ports.

P&O, which began life as the Peninsular and Oriental Steam Navigation company in 1837, said all six of its cross-Channel ferries will be re-registered from the UK registry in Cyprus to keep EU tax benefits. The ferries include, the Spirit of Britain, the Pride of Kent and the Pride of Canterbury. Sony confirmed it was merging its London-based European unit with a new entity based in Amsterdam that would become the new continental HQ. Sony said: “In this way we can continue our business as usual without disruption once the UK leaves the EU.”

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Corbyn can nationalize the rialways and hospitals, and remain.

Britain ‘Could Triple State Aid For Industry Under EU Rules’ (G.)

Britain could triple state aid spending to industry without breaching EU rules, according to a study that compares government subsidies to promote economic growth across Europe. EU state aid rules “do not prevent an active industrial policy”, the report found, giving the green light to the UK government for an increase in its £7bn of state aid to nearer £21bn. The report by the left-leaning IPPR thinktank found that the EU’s state aid rules would apply to the UK once it had left the union because officials in Brussels would enforce the measures through a trade deal. The IPPR director, Tom Kibasi, said: “If the UK government decided to match Denmark, it could invest £250bn over a decade in a more active industrial policy.

“That would give it huge scope to support key areas of the economy, whether we remain in the EU or leave it.” The IPPR has not taken a view on Brexit, but its intervention in the debate over state aid will be keenly examined by Labour party supporters who voted to leave the EU. Like the Labour leader, Jeremy Corbyn, many of them believed that rules imposed by Brussels would constrain a leftwing government from nationalising parts of the economy and from supporting cooperatives or providing funds through state-backed local banks.

State aid can range from a government tax relief scheme for investors to a local authority giving a subsidy to a property developer. It is normally prohibited to prevent trade and competition between firms from being distorted, discouraging investment and increasing costs to consumers. However, the EU has allowed hundreds of public investment programmes to go ahead that support businesses under a regime that the IPPR said was more flexible than it might appear.

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Doubling down on the very things that turns their people -and others- against them.

France And Germany Take Major Step Toward EU Army (ZH)

French President Emmanuel Macron’s push for what he previously called “a real European army” got a big boost on Tuesday amid France and Germany signing an updated historic treaty reaffirming their close ties and commitment to support each other during a ceremony in the city of Aachen, a border town connected to Charlemagne and the Holy Roman Empire. But the timing for the renewal of the two countries’ 1963 post-war reconciliation accord is what’s most interesting, given both the rise of eurosceptic nationalism, the uncertainty of Brexit, and just as massive ‘Yellow Vests’ protests rage across France for a tenth week.

Macron addressed this trend specifically at the signing ceremony with the words, “At a time when Europe is threatened by nationalism, which is growing from within… Germany and France must assume their responsibility and show the way forward. Germany’s Angela Merkel agreed, adding in her own remarks: “We are doing this because we live in special times and because in these times we need resolute, distinct, clear, forward-looking answers.” The agreement, which is being described as sparse on specifics or detail, focuses on foreign policy and defense ties between Berlin and Paris. “Populism and nationalism are strengthening in all of our countries,” Merkel told EU officials at the ceremony. “74 years – a single human lifetime – after the end of the second world war, what seems self-evident is being called into question once more.”

Macron said those “who forget the value of Franco-German reconciliation are making themselves accomplices of the crimes of the past. Those who… spread lies are hurting the same people they are pretending to defend, by seeking to repeat history.” And in remarks that formed another affirmation that the two leaders are seeking to form an “EU army” Merkel said just before signing the treaty: “The fourth article of the treaty says we, Germany and France, are obliged to support and help each other, including through military force, in case of an attack on our sovereignty.” The text of the updated treaty includes the aim of a “German-French economic area with common rules” and a “common military culture” that Merkel asserted could “contribute to the creation of a European army”.

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US position gets stronger as China struggles.

Trump Won’t Soften Hardline On China To Make Trade Deal (R.)

As much as U.S. President Donald Trump wants to boost markets through a trade pact with China, he will not soften his position that Beijing must make real structural reforms, including how it handles intellectual property, to reach a deal, advisers say. Offering to buy more American goods is unlikely by itself to overcome an issue that has bedeviled talks between the two countries. Those talks are set to continue when Chinese Vice Premier Liu He visits Washington at the end of January. The United States accuses China of stealing intellectual property and forcing American companies to share technology when they do business in China. Beijing denies the accusations.

With a March 1 deadline approaching to reach an agreement or risk an escalation of tariffs on another $200 billion worth of Chinese goods, the two sides are still far apart on key, structural elements critical for a deal, according to sources familiar with the talks. “We’re not yet in a position where our concerns have been addressed sufficiently,” one U.S. official said, speaking on condition of anonymity. The official said the Trump team, led by hardline U.S. Trade Representative Robert Lighthizer, was focused on such structural issues as well as trade imbalances. White House economic adviser Larry Kudlow told Reuters that forced technology transfers, IP theft and ownership restrictions remained a top priority for Trump. “The president’s said many times how crucial that is, and he’s not going to back down,” Kudlow said.

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Is Orwell available in China? How much longer for? Then again, it’s about what tech can do. And what it can do in China, it can and will do where you live.

Chinese App ‘Live-Shames’ Debtors Within 500-Meter Radius (ZH)

Authorities in the northern Chinese province of Hebei have rolled out an app over WeChat which can tell people if they’re walking near someone in debt, according to China Daily. The program, aptly named “map of deadbeat debtors,” flashes a warning if someone in debt is within a 500-meter radius – showing their exact location according to a screenshot of the app. Whether the app reveals the debtors’ names or photos is unknown, nor does China Daily mention how much money is owed or to whom – but according to paper the app allows people to “whistle-blow on debtors capable of paying their debts.” “It’s a part of our measures to enforce our rulings and create a socially credible environment,” said a spokesman for the Higher People’s Court of Hebei – which is behind the app.

The “map of deadbeat debtors” is yet the latest in China’s push towards a shame-based “social credit score” system which has already been deployed in several parts of the country. According to a November report, Beijing has an ambitious plan to control China’s citizens through a system of social scoring that punishes behavior it does not approve. [..] Hangzhou, the capital city of China’s Zhejiang province, rolled out its social credit system earlier this year, rewarding “pro-social behaviors” such as blood donations, healthy lifestyles, and volunteer work while punishing those who violate traffic laws, smoke and drink, and speak poorly about government.

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Plastics. “A standard 5-kilogram (11-pound) wash of polyester fabrics has been estimated to release up to 6,000,000 microfibers.” ” European shellfish consumers could potentially ingest 11,000 microplastic particles per year.”

‘Never Good News Having Particles in Your Brain’ (Spiegel)

Microplastics come from many sources, for example from the breakdown of larger items, abrasion from tires, microbeads from cosmetics or synthetic clothing fibers. A standard 5-kilogram (11-pound) wash of polyester fabrics has been estimated to release up to 6,000,000 microfibers. Through surface runoff, manufacturing processes, agriculture or waste water treatment facilities, most of this ends up in the environment, for example in rivers, and is eventually lost to the seas. Extrapolations suggest that up to 250 million tons of plastic will be present in the oceans by 2025.

Filter feeders like mussels seem to readily internalize microplastics, because they are of the same size as their preferred diet. It has been estimated that European shellfish consumers could potentially ingest 11,000 microplastic particles per year. A lot of the plastic particles in the environment are present in the atmosphere and transported by the wind. When you breathe in air, microscopic plastic particles are inhaled as well. Salt and sugar, for example, have also been reported to be contaminated with plastic, as well as honey and German beer. The analysis of tap water and bottled water found that a high proportion of drinking water contains plastic fragments.

Bigger particles are not readily absorbed. Most of these just seem to pass through the body without doing much harm. It is currently believed that these bigger particles do not penetrate deeply into organs and, if at all, can only cause some limited local inflammation or tissue abrasion. Smaller particles however, referred to as nanoplastics, are a different thing altogether. The smaller the size of the plastic particles, the more likely they are to cross biological barriers such as cell membranes. What we know is that nanoparticles in general can interact with proteins, lipids and carbohydrates in the body. Nanoparticles can even cross the blood-brain barrier and it seems probable that they can affect the central nervous system. Reports of behavioral changes in shrimp and fish exposed to nanoplastics support this hypothesis.

Plastic particles made fish eat slower and explore their surroundings less. There is no concrete evidence right now that nanoplastics penetrate brain tissue in humans, let alone affect behavior. But it has been reported that plastic particles cause oxidative stress in human cell lines. This could potentially cause a number of problems including tissue degradation or inflammation, and it flags up the possibility that an individual with a high concentration of plastic contamination in the central nervous system might have an adverse reaction. Depression for instance has been linked to nanoparticle toxicity in the central nervous system. The plastic fragments might even initiate plaque formation and make Alzheimer’s more likely. It is never good news having particles in your brain.

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Jan 172019
 


Pablo Picasso Nude female standing 1922

 

Theresa May Survives Confidence Vote, Britain Remains In Brexit Deadlock (G.)
Corbyn: No Talks With May Until No-Deal Brexit Is Off The Table (G.)
Markets Expect Brexit To Be Delayed, Bank Of England Governor Says (G.)
More Than 170 UK Business Leaders Join Call For 2nd Brexit Referendum (G.)
German Carmakers Warn Hard Brexit Would Be ‘Fatal’ (R.)
Trump ‘Inclined’ To Impose New US Auto Tariffs (R.)
Chinese Unemployment Worries Grow As Beijing Beefs Up Stimulus (CNBC)
China Injects Gargantuan 1.1 Trillion In Liquidity This Week (ZH)
Greek PM Tsipras Wins Confidence Vote After FYROM Name Crisis (R.)
DOJ Official Warned Steele Dossier Biased, Connected To Clinton (Solomon)
The New York Times Smears the President (Stockman)
Fake Washington Post Copies Announcing Trump Resignation Handed Out In DC (RT)
Plastic Pollution Of The Oceans Is Set To Treble In The Next Decade (G.)

 

 

Brexit will be delayed, quite possibly indefinitely. May’s looking for a way to achieve this while putting the blame on anyone but herself. She survived this votes only becasue of the DUP, whose votes she bought. Welcome to democracy.

Theresa May Survives Confidence Vote, Britain Remains In Brexit Deadlock (G.)

Theresa May has survived as prime minister after weathering a dramatic no-confidence vote in her government, but was left scrambling to strike a Brexit compromise that could secure the backing of parliament. In a statement in Downing Street on Wednesday night, the prime minister exhorted politicians from all parties to “put aside self-interest”, and promised to consult with MPs with “the widest possible range of views” in the coming days. It followed her announcement that she would invite Jeremy Corbyn and other party leaders for immediate talks on how to secure a Brexit deal, something she had declined to do earlier in the day, although Labour later said Corbyn would decline the invitation unless no-deal was taken off the table.

A day after overwhelmingly rejecting her Brexit deal, rebel Conservatives and Democratic Unionist party (DUP) MPs swung behind the prime minister to defeat Labour’s motion of no confidence by 325 votes to 306 – a majority of 19. In her late-night statement, the prime minister said: “I am disappointed that the leader of the Labour party has not so far chosen to take part – but our door remains open … It will not be an easy task, but MPs know they have a duty to act in the national interest, reach a consensus and get this done.”

The Scottish National party’s leader in Westminster, Ian Blackford, met May on Wednesday night, and the Liberal Democrat leader, Vince Cable, also accepted her invitation. Blackford later wrote to May, urging her to make a “gesture of faith” to show that she was serious. He said the SNP would take part in cross-party talks if she was able to confirm “that the extension of article 50, a ruling out of a no-deal Brexit and the option of a second EU referendum would form the basis of those discussions”.

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Corbyn is gambling on new elections. That, too, delays any solution.

Corbyn: No Talks With May Until No-Deal Brexit Is Off The Table (G.)

Jeremy Corbyn has said he will not hold talks with Theresa May until the prime minister agrees to remove the threat of a no-deal Brexit, ruling out any meeting with the prime minister in the immediate aftermath of the no-confidence vote. Responding to May’s offer of swift talks to break the Brexit impasse, the Labour leader told MPs that before he would entertain “positive discussions about the way forward” she had to agree to his precondition. “The government must remove clearly once and for all the catastrophe of a no-deal exit from the European Union and all the chaos that would result from that,” Corbyn said minutes after the opposition party was defeated in the confidence vote.

Minutes after the exchanges in the Commons, with Downing Street refusing to take no deal off the table, Corbyn’s spokesman said that as things stood, the Labour leader would not take up May’s offer of an evening Brexit meeting. The two sides were still in discussions, but in light of such a fundamental difference, appeared unlikely to come to an agreement to speak in the immediate future – even though only 10 weeks remain until the UK’s planned departure date. When asked directly if Corbyn was going to No10, the spokesman added: “As I understand it that is not going to take place.”

Labour is willing to support a Brexit deal if May will accept a customs union, a close relationship with the single market and enhanced protections for workers and consumers rights. However, this would represent a massive shift for the prime minister and risk splits in her own party, making it hard to see how a deal could be agreed. Corbyn’s spokesman acknowledged this, saying, “Any change in the government red lines will cause them internal splits.”

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Times headline said 2020.

Markets Expect Brexit To Be Delayed, Bank Of England Governor Says (G.)

Investors expect a delay to Britain’s exit from the EU following the crushing defeat of the prime minister’s Brexit deal, the Bank of England governor has said. Mark Carney said the reaction of financial markets in the wake of the vote showed a degree of confidence that a no-deal Brexit was unlikely on 29 March. The pound bounced back against the dollar on Tuesday night amid optimism that article 50 would be prolonged and that the prospect of a disorderly severance from Brussels had receded. “Public market commentary, consistent with our market intelligence, is that a rebound appears to reflect some expectation that the process of resolution would be extended and that the prospect of no-deal may have been diminished,” said Carney.

Speaking to MPs on the Treasury select committee on Wednesday, the governor said investors were following developments in parliament closely to detect shifts in the direction of Brexit. The reaction of EU officials and governments across the continent was also being watched closely. Carney said a “sharp rebound in sterling following the vote” was the main indicator that some investors believed Brexit could be delayed beyond the end of March.

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2nd referendum is poison. General elections not so much. But the Tories will cling to power no matter what.

More Than 170 UK Business Leaders Join Call For 2nd Brexit Referendum (G.)

More than 170 business leaders, including Terence Conran and Norman Foster, have thrown their weight behind the campaign for a second referendum on Brexit. In a step designed to indicate growing support for a “people’s vote” after Theresa May suffered the heaviest parliamentary defeat in the modern era over her Brexit plan, the letter due to be published in the Times on Thursday asks both main party leaders in Westminster to support a second referendum. Conran, the renowned designer, who was knighted in 1983, and Lord Foster, the architect behind the Gherkin skyscraper in the City of London, were among 172 signatories from the world of business urging a second referendum on the final Brexit deal.

The architect Sir David Chipperfield and the noble laureate and research scientist Paul Nurse were also among new names on the list of supporters. Several other captains of industry, including Mike Rake, the former chairman of BT, had previously backed the campaign and were also included as signatories. The figures from business, together representing more than £100bn in annual contributions to the UK economy, warned that a bad Brexit deal or Britain leaving without any deal at all could damage the economy. While admitting that many business leaders had initially backed May’s deal, even though they believed it was far from perfect, the group stated that the priority after the prime minister’s defeat in parliament was to stop a “chaotic crash-out from the EU”.

The letter said: “The only viable way to do this is by asking the people whether they still want to leave the EU. With the clock now ticking rapidly before we are due to quit, politicians must not waste any more time on fantasies. We urge the leadership of both the main parties to support a people’s vote.” Both May and the Labour frontbench under Jeremy Corbyn have so far dismissed the idea of a second referendum. The prime minister has said she will speak to senior MPs to find a compromise deal, while Corbyn is pushing for a general election.

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German economy is under severe pressure. Still, I don’t see what’s so wrong about fewer cars.

German Carmakers Warn Hard Brexit Would Be ‘Fatal’ (R.)

German carmakers on Wednesday warned of fatal consequences if Britain left the European Union without a divorce deal, predicting job losses in Britain and Europe and urging lawmakers to redouble efforts to ensure tariff-free trade can continue. Prime Minister Theresa May’s deal to leave the EU suffered an overwhelming defeat in parliament on Tuesday, leaving the country’s future in limbo and manufacturers bracing for their “worst-case scenario”, a no-deal Brexit. Britain would suffer most if it lost free trade with European markets since 80 percent of vehicles assembled in the country are exported, mostly to the European Union. But for Germany the stakes are also high.

In 2016, Britain was the largest single export market for German manufacturers, who sold 800,000 new cars there, or 20 percent of their overall global exports. Fewer cars are exported to China and U.S. because German carmakers have factories there. “The consequences of a ‘no deal’ would be fatal,” German auto industry association VDA said after the vote. “Without an orderly and practical solution for business, jobs in the car industry, particularly on the British side, are on the line.”

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Cars is not the big one, agriculture is. But Europe won’t budge on chlorinated chickens.

Trump ‘Inclined’ To Impose New US Auto Tariffs (R.)

U.S. President Donald Trump is likely to move ahead with tariffs on imported vehicles, a move that could prompt the European Union to agree a new trade deal, said Senate Finance Committee Chairman Charles Grassley on Wednesday. “I think the president’s inclined to do it,” the Republican senator told reporters. “I think Europe (is) very very concerned about those tariffs … It may be the instrument that gets Europe to negotiate.” U.S. Commerce Department recommendations into whether Trump should impose tariffs of up to 25% on imported cars and parts on national security grounds are due by mid-February. Grassley, who has had regular talks with Trump and U.S. Trade Representative Robert Lighthizer on trade issues, said he did not like new tariffs but “they are a fact of life when Trump is in the White House.”

He said they may have been an “effective tool” in getting China, Canada, Mexico and others to negotiate on trade. Iowa senator Grassley also wants the EU to agree to include agricultural issues in trade talks, although EU trade commissioner Cecilia Malmström said last week the 28-country bloc could not negotiate on agriculture. The White House has pledged not to move forward with imposing tariffs on the EU or Japan as long as it is making constructive progress in bilateral trade talks. Trump has urged the EU to drop its 10% tariff on imported vehicles. The U.S. passenger car tariff is 2.5%, while it imposes 25% tariffs on pickup trucks. Trump has repeatedly threatened to impose new auto tariffs. “Cars is the big one,” Trump said last year.

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The economy grows 6% amid widespread job losses?!

Chinese Unemployment Worries Grow As Beijing Beefs Up Stimulus (CNBC)

Beijing is working hard to stop a slowing Chinese economy from hitting its workforce. In the last several weeks authorities have made a flurry of announcements, including tax cuts, monetary policy loosening and plans to support public spending. The push comes as economic data points to sagging domestic growth and the U.S. looks set to keep up the pressure on trade. Amid that environment, worries of widespread job losses won’t help the already gloomy sentiment that’s giving consumers a second thought on spending. The overarching worry for China’s leaders is that unemployment could lead to social unrest, and deeper questioning of the Communist Party’s claim to having a handle on the best interests of the country.

Already, the economy is widely expected to slow from around 6.5% growth to just above 6%. “We think the biggest risk in the near term is rising unemployment around the Lunar New Year,” Haibin Zhu, chief China economist and head of China equity strategy, J.P. Morgan, said in a Monday report. [..] Gavekal Dragonomics’ China Consumer Analyst Ernan Cui pointed out in a Jan. 9 report that an official survey covering 374,000 large industrial firms shows total employment declined by about 2.8 million people in the 12 months through November. [..] [A UBS] survey in November found that 23% of 125 Chinese respondents in manufacturing have already laid off employees due to the negative effect of U.S.-China trade tensions. Some 34% planned to lay off employees in the next six months, and 18% had cut wages, the report said.


Job losses in Chinese manufacturing accelerated in mid-2018 after the U.S. imposed tariffs Note: Employment in large industrial enterprises, three-month moving average. December excluded for data anomalies.

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“..a panicked “spasm”..”

China Injects Gargantuan 1.1 Trillion In Liquidity This Week (ZH)

Following what Bloomberg calculated was a record net reverse repo liquidity injection on Wednesday, when the PBOC injected a whopping 560 billion yuan of liquidity into the financial system via open market operations, the Chinese central bank has done it again and in Thursday’s open market operation, it sold 250BN yuan in 7 Day repos (slightly below yesterday’s record 350BN), and 150BN in 28 Day repos, which net of maturities resulted in a whopping net 380BN yuan ($56.2BN) liquidity injection. This brings the net liquidity injection this week to a near record 1.14 Trillion yuan (Monday 20BN, Tuesday 180BN, Wednesday 560BN and Thursday 380BN) and the week is not even over yet – should tomorrow’s reverse repo be of similar magnitude, then this week will go down in history as China’s biggest liquidity injection on record.

As yesterday, today’s massive liquidity injection was aimed at “keeping reasonable and sufficient liquidity in banking system as liquidity falls relatively fast during peak season for tax payments,” according to a statement from the PBOC, although why this year should be such a significant outlier, even when factoring in the liquidity needs ahead of the Lunar new year, to prior periods was not exactly clear. There is, of course, a much simpler explanation: with Chinese economic and trade data turning from bad to worse with every passing day, Beijing’s response is increasingly one of a panicked “spasm”, as Nomura’s Charlie McElligott wrote today when he noted that with regard to the response of Chinese authorities in addressing their economic slowdown and credit crunch, “it had to get worse before it got better”—recently collapsing Chinese data has now clearly forced an escalation of easing-/stimulus-/liquidity- policies.

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He ‘won’ by one vote. And now has to win another vote on the name deal itself. Funny to see western media all say Macedonia is set to change its name. Who likes homework, after all? There is no country named Macedonia, that’s the whole point.

Greek PM Tsipras Wins Confidence Vote After FYROM Name Crisis (R.)

The Greek prime minister, Alexis Tsipras, has won a confidence vote in parliament, clearing a major hurdle for Greece’s approval of an accord to end a dispute over Macedonia’s name and averting the prospect of a snap election. Tsipras called the confidence motion after his rightwing coalition partner Panos Kammenos quit the government on Sunday in protest at the name deal signed between Athens and Skopje last year. Parliament gave Tsipras 151 votes, meeting the threshold he required in the 300-member assembly. His leftist party, Syriza, has 145 seats in parliament. Additional support was given by defectors of Kammenos’s Independent Greeks party (ANEL) and independents.

Tsipras told parliament: “I call upon you with hand on heart to give a vote of confidence to the government which gave battle, which bled, but managed to haul the country out of memorandums and surveillance,” referring to Greece’s international lenders, who kept the country on a tight leash for years. [..] Greek opponents of the agreement say Macedonia’s new name – the Republic of North Macedonia, reached after decades of dispute between Athens and Skopje – represents an attempt to appropriate Greek identity.

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There are far too many questions for this to go away. Bill Barr to the rescue.

DOJ Official Warned Steele Dossier Biased, Connected To Clinton (Solomon)

When the annals of mistakes and abuses in the FBI’s Russia investigation are finally written, Bruce Ohr almost certainly will be the No. 1 witness, according to my sources. The then-No. 4 Department of Justice (DOJ) official briefed both senior FBI and DOJ officials in summer 2016 about Christopher Steele’s Russia dossier, explicitly cautioning that the British intelligence operative’s work was opposition research connected to Hillary Clinton’s campaign and might be biased. Ohr’s briefings, in July and August 2016, included the deputy director of the FBI, a top lawyer for then-Attorney General Loretta Lynch and a Justice official who later would become the top deputy to special counsel Robert Mueller.

At the time, Ohr was the associate attorney general. Yet his warnings about political bias were pointedly omitted weeks later from the Foreign Intelligence Surveillance Act (FISA) warrant that the FBI obtained from a federal court, granting it permission to spy on whether the Trump campaign was colluding with Russia to hijack the 2016 presidential election. Ohr’s activities, chronicled in handwritten notes and congressional testimony I gleaned from sources, provide the most damning evidence to date that FBI and DOJ officials may have misled federal judges in October 2016 in their zeal to obtain the warrant targeting Trump adviser Carter Page just weeks before Election Day.

They also contradict a key argument that House Democrats have made in their formal intelligence conclusions about the Russia case. Since it was disclosed last year that Steele’s dossier formed a central piece of evidence supporting the FISA warrant, Justice and FBI officials have been vague about exactly when they learned that Steele’s work was paid for by the law firm representing the Clinton campaign and the Democratic National Committee (DNC). A redacted version of the FISA application released last year shows the FBI did not mention any connection to the DNC or Clinton.

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David guts the entire narrative. Well done.

The New York Times Smears the President (Stockman)

The Donald has been on a red hot twitter rampage, and he’s completely justified. Actually, we didn’t think the Russian Collusion Hoax could get any stupider until we saw the New York Times’ Friday evening bushwhack. The trio of authors, apparently self-tortured victims of the Trump Derangement Syndrome, actually had the gall to print a story in the once and former Gray Lady of journalistic rectitude which was nothing more than an ugly smear on the sitting President of the United States—one that would have done Joe McCarthy proud. [..] the trio —one of whom graduated from Harvard in 2015 and the other two not much older—don’t seem to even know that foreign policy is a debatable issue.

Or that the American people actually voted into office a candidate who took the other side of Imperial Washington’s unwarranted demonization of Putin and made no bones about his desire for a rapprochement with Russia. Actually, as to pursuing rapprochement, so did: • JFK, after the near catastrophe of the Cuban Missile Crisis; • Lyndon Johnson, after the Seven Days War during his meeting with Kosygin at Glassboro NJ; • Richard Nixon, with the ABM Treaty, detente and his visit with Brezhnev in Moscow; • Jimmy Carter, when he signed the SALT-II agreement; • Ronald Reagan, when he went to Moscow to virtually end the Cold War; and • Bill Clinton, when he sent a multi-billion IMF aid package to Yeltsin to help him get re-elected in 1996.

The fact is, all of the above presidential policy initiatives were heatedly debated in Washington during a period when the US and Soviet Union each had roughly 9,000 nuclear warheads pointed at the other. But that did not lead to FBI counter-intelligence investigations of politicians—to say nothing of sitting Presidents—who took the “wrong” side of these thoroughly democratic debates.

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Wonder who they’re mocking. Is it Bezos?

Fake Washington Post Copies Announcing Trump Resignation Handed Out In DC (RT)

Taking the art of fake news to new heights, a non-profit has circulated mock Washington Post issues near the White House, telling readers that President Donald Trump fled to Crimea on the back of women-led protests. Activists giving out fake copies of the Washington Post commuters were spotted near the White House on Wednesday morning. Vigilant readers immediately alerted the newspaper, which said that the copies, dated May 1, 2019, were “not Post products” and that it was “looking into this.” The fake copies include an eye-catching headline for the lead story: “UNPRESIDENTED. Ending Crisis, Trump Hastily Departs White House,” complete with a picture of a glum Trump on his way to “slip in a private car in the wee hours of the morning.”

The paper “reports” that Trump abruptly left his office at 3:15am on May 1, leaving a message on a napkin in the Oval Office that blamed “crooked Hillary,” the mysterious “Hfior,” and “the Fake News Media” for his flight. The report, meticulously mimicking the Washington Post’s source-based reporting style, cites “four White House aides” speaking on condition of anonymity, that they found the napkin two days before events took a dramatic turn. Trump’s fictional resignation and the subsequent swearing-in of Vice President Mike Pence, who instantly promises to keep as low a profile as possible, comes amidst “massive protests” staged by a grassroots movement with #MeToo as its backbone.

[..] The news of Trump’s resignation sparks a wave of celebrations across the globe, with European countries refusing to shelter him. The creators of the fake diligently stick to the Washington Post’s style, fanning the Russia collusion narrative just like their prototype by sending Trump to seek safe haven in Russia – namely, Crimea. While there has been speculation that radical liberal political activist group MoveOn or CODEPINK, a women-led grassroots NGO, might be behind the stunt since they promoted the action, later in the day, The Yes Men, a progressive non-profit group, claimed responsibility in a press release.

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UK MPs want action. I say don’t depend on politicians if you want to get things done. Britain has a target date of 2042 for phasing out avoidable plastic waste. As its volume is set to treble by 2030. That is so insane, forget about the rest too. Politics won’t solve this.

Plastic Pollution Of The Oceans Is Set To Treble In The Next Decade (G.)

A new global agreement to protect the seas should be a priority for the government to stop our seas becoming a “sewer”, according to a cross-party group of MPs. Plastic pollution is set to treble in the next decade, the environmental audit committee warned, while overfishing is denuding vital marine habitats of fish, and climate change is causing harmful warming of the oceans as well as deoxygenation and acidification. The effects of plastic pollution are particularly poorly understood, the committee found in its report, published on Thursday. It found “a lack of data on the serious long-term harm and health implications of plastic particles entering the food chain” and accused the government of treating the oceans as “out of sight, out of mind”.

One way of tackling the problem would be through a “Paris agreement for the sea”, the MPs recommended. Governments are still working on a possible new ocean protection treaty, under the UN. The MPs also called for the government to bring forward the target date of phasing out avoidable plastic waste from 2042, and urged greater action to reduce greenhouse gas emissions. Labour MP Mary Creagh, chair of the committee, said: “We have to stop treating our seas as a sewer. Plastic, chemicals and sewage are choking our oceans, polluting our water and harming every ocean species from plankton to polar bears. Supporting Indonesia and Malaysia to reduce plastic while simultaneously exporting our contaminated plastics to them shows the lack of a joined-up approach at the heart of the government’s strategy.”

[..] A UK government spokesperson said: “The UK is already a global leader in protecting our seas and oceans. We have recently proposed 41 new marine conservation zones, led calls to protect 30% of the world’s oceans by 2030, and we are going further and faster to tackle the plastic that harms marine life with our ambitious resources and waste strategy. “We know there is more to do, and we will soon publish an international ocean strategy to drive global action to conserve the world’s oceans.”

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May 122018
 
 May 12, 2018  Posted by at 9:26 am Finance Tagged with: , , , , , , , , , , ,  


Pieter Bruegel the Elder Dulle Griet, also known as Mad Meg 1563

 

If Real Consumer Spending Doesn’t Reverse Course, Look Out Retail Stocks (Street)
Apple Made More Profit In 3 Months Than Amazon In Its Entire Lifetime (CNBC)
Facebook Faces Class Action Lawsuit Over Collecting Texts And Call Logs (G.)
Mark Zuckerberg’s Control Of Facebook Is Like A Dictatorship: CalSTRS (CNBC)
Facebook ‘Very Serious’ About Launching Its Own Cryptocurrency (CNBC)
There Will Be No Trade War With Germany, New US Ambassador Promises (R.)
Turkey Remains A “Priority Market” For British Weapons (MEE)
Erdogan Slams Rating Agencies For Upgrading ‘Bankrupt’ Greece (K.)
PDVSA To Shut Curacao Refinery Amid Fight With Conoco (R.)
Canada Sued Over Years Of Experimentation On Indigenous People (G.)
Maasai Herders Driven Off Land To Make Way For Luxury Safaris (G.)
Plastic Bag Found At The Deepest Point In The Ocean (SA)

 

 

Remember, 70% of US GDP. Coming from a population whose majority are maxed out.

If Real Consumer Spending Doesn’t Reverse Course, Look Out Retail Stocks (Street)

With the Amazon beast breathing down their necks, the last thing struggling retailers need is a cautious U.S. consumer. Yet, that’s exactly what they have gotten in recent months — and if it persists, retail stocks are likely to take it on the chin this summer. Real consumer spending took a nosedive in the first quarter (chart below) as consumers assessed the impact President Trump’s tax reform plan. Not helping matters was a more volatile stock market, rising inflation and a cooling U.S. labor market. In turn, consumer sentiment has remained stuck in a range since February. Retail stocks have followed suit.

The VanEck Vectors Retail ETF (RTH) is down about 7% since hitting a high on Jan. 29. This week has brought bearish notes on department stores like Macy’s from Wall Street shops, citing fears of online competition and challenging first quarter sales conditions. Macy’s CEO Jeff Gennette will be speaking at TheStreet’s sister publication, The Deal’s, big corporate governance in June. “We think that real consumption growth will firm from 1.1% annualized in 1Q to 2.3% in 2Q. We continue to see similarities between this year and last that likely are related to abnormal patterns of tax refunds, and like last year, we expect real consumer spending to firm noticeably between 1Q and 2Q,” says JPMorgan & Chase strategist Daniel Silver. But even Silver doesn’t sound 100% convinced.

“But inflation likely will be much stronger in 2Q18 than it was in 2Q17, and higher prices should dampen real spending and erode some of the benefits associated with lower taxes.”

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But Bezos is the richest of them all.

Apple Made More Profit In 3 Months Than Amazon In Its Entire Lifetime (CNBC)

One word may explain Warren Buffett’s investment decisions on Apple and Amazon: profit. Last week Buffett both lamented on not investing in Amazon shares and revealed how he added massively to Berkshire Hathaway’s stake in Apple. The Oracle of Omaha’s moves may be explained by his philosophy of emphasizing a company’s historical financial track record versus putting credence in aggressive future forecasts from analysts. “I think it’s fair to say, we’ve never looked at a [analyst] projection in connection with either a security we’ve bought or a business we’ve bought,” Buffett said during a Berkshire Hathaway annual shareholder meeting in 1995, according to remarks found using CNBC’s Warren Buffett Archive.

Apple “is an unbelievable company,” Buffett told CNBC on May 3. “If you look at Apple, I think it earns almost twice as much as the second most profitable company in the United States.” The smartphone maker generated a $48.35 billion in profit during its fiscal 2017 and made $13.8 billion in net income during the March 2018 quarter. In comparison, Amazon’s total net income since inception is about $9.6 billion. The number was calculated by adding up all of Amazon’s annual net income figures since its inception to the company’s $1.6 billion profit in the March 2018 quarter.

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Will a US court now sanction Facebook’s spying?

Facebook Faces Class Action Lawsuit Over Collecting Texts And Call Logs (G.)

Facebook is facing a class action lawsuit over the revelations that it logged text messages and phone calls via its smartphone apps. In the lawsuit filed in Facebook’s home of the northern district of California, the primary plaintiff, John Condelles III, states that the social network’s actions “presents several wrongs, including a consumer bait-and-switch, an invasion of privacy, wrongful monitoring of minors and potential attacks on privileged communications” such as those between doctor and patient. Facebook collected the logs of text messages and calls, including the recipients and duration of the communications, through its apps for Android including Messenger when users opted into being able to send SMS from the app or give access to their contact lists.

“Facebook has collected and stored information in a scope and manner beyond that which users knowingly authorised. The practice is ongoing,” states the filing first reported by the Register. The extent of the collection was revealed when users began downloading and sifting through the data Facebook held on them following the Cambridge Analytica scandal. The plaintiffs allege that Facebook’s collection of the data from users’ phones breaches California’s Unfair Competition Law on three counts – including fraudulent business practice – in addition to the Consumer Legal Remedies Act and the Electronic Communications Privacy Act. [..] Facebook is also facing a class action lawsuit from both British and US lawyers as part of a case against the social network, Cambridge Analytica and two other companies for allegedly misusing the personal data of 71 million people.

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But they won’t sell their shares.

Mark Zuckerberg’s Control Of Facebook Is Like A Dictatorship: CalSTRS (CNBC)

The capital markets are a democracy, but that’s not how Facebook is being run, said Christopher Ailman, the chief investment officer of the California State Teachers’ Retirement System, known as CalSTRS. “There is something wrong,” he said Thursday on CNBC’s “Closing Bell.” “When Facebook changed its structure to take public money in, they should have changed their structure to a more open board structure, and we think that there’s a problem with having one person in charge of the company,” he added. CEO Mark Zuckerberg owns a majority of the voting rights to the company. That’s because the tech giant has dual-class shares.

Facebook’s Class B shares are controlled by Zuckerberg and a small group of insiders and have 10 votes per share. Class A shares only have one vote per share. The end result is that Zuckerberg and those insiders control almost 70 percent of the voting shares in Facebook. CalSTRS took on the issue in a recent op-ed in the Financial Times. CalSTRS portfolio manager Aeisha Mastagni wrote, “Why does Mr. Zuckerberg need the entrenchment factor of a dual-class structure? Is it because he does not want governance to evolve with the rest of his company? If so, this American dream is now akin to a dictatorship.”

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A long way from Satoshi.

Facebook ‘Very Serious’ About Launching Its Own Cryptocurrency (CNBC)

Facebook is “very serious” about launching its own cryptocurrency, according to a report from Cheddar. It’s not the first time the idea of a Facebook coin has been floated, but the plans take on some greater meaning in light of Facebook’s recently reshuffled executive structure and newly formed blockchain group. Blockchain, the decentralized record-keeping system, could help tackle some of Facebook’s most bothersome problems, like identity verification or advertising sales. It’s also the technology behind most cryptocurrencies, logging ownership and transfers of the digital tokens.

“Like many other companies Facebook is exploring ways to leverage the power of blockchain technology. This new small team will be exploring many different applications,” a Facebook spokesperson told CNBC in a statement. It would likely be years before Facebook’s work on blockchain and cryptocurrency became anything material, Cheddar reports, citing anonymous sources. The business news site also reports Facebook has no plans to hold an ICO, or initial coin offering.

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The cover of the new Der Spiegel doesn’t seem convinced.

There Will Be No Trade War With Germany, New US Ambassador Promises (R.)

The new U.S. ambassador to Germany said the row over Washington’s planned imposition of punitive tariffs on European goods would not trigger a trade war, adding that U.S. President Donald Trump only wanted “a level playing field”. In an interview with the Funke newspaper group, Richard Grenell insisted that the United States was awaiting proposals on how punitive tariffs could be averted. “Germans are doing a phenomenal job on trade,” he said. “There will be no trade war … We are talking with our friends to solve a problem.” The United States wanted to see Europe’s proposals before deciding what would follow the expiry of an already extended June 1 deadline to impose tariffs, he added.

Less than a week into the job, Grenell has already triggered headlines with his demand in a tweet that German companies in Iran should “wind down operations” immediately after Trump withdrew the United States from an international nuclear deal. In the interview, Grenell maintained the hard line on Iran that has caused dismay in Europe’s capitals, restating the U.S. government’s position that Europe must re-impose sanctions on Iran. “We expect our friends and allies to help us to bring Iran back to the negotiating table,” he said, adding that the United States had proof Iran had violated its commitment not to enrich uranium.

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Who’s going to protest Erdogan’s visit?

Turkey Remains A “Priority Market” For British Weapons (MEE)

Theresa May is set to roll out the red carpet for Turkish President Recep Tayyip Erdogan this weekend, as new figures reveal that Britain has sold more than $1bn of weapons to Ankara since the failed 2016 coup and subsequent crackdown under emergency powers, Middle East Eye can reveal. Turkey remains a “priority market” for British weapons, despite concerns from human rights groups and EU officials over the erosion of the country’s rule of law. Turkey is a fellow member of NATO and has cooperated with the EU in tackling the refugee crisis, but critics say that Erdogan’s government has arrested or sacked more than 100,000 state workers and members of the military in the wake of the coup attempt.

Unlike many other Western allies, London spoke out quickly after the coup, in which fighter jets bombed the Turkish parliament and troops opened fire on civilians. But the UK has remained largely silent as Turkey targeted not only the alleged plotters but also political dissidents, journalists and members of pro-Kurdish parties for “supporting terrorism”. Erdogan will meet the Queen and the prime minister during his three-day visit to the UK, starting on Sunday. It comes as the UK is making a Brexit push to boost trade with Ankara, but also in the middle of a snap Turkish parliamentary and presidential campaigns conducted under a state of emergency.

UK weapons sales since the attempted coup include a $667m deal for military electronic data, armoured vehicles, small arms, ammunition, missiles, drones, aircraft and helicopters. It also includes a $135m deal for BAE Systems to fulfil Erdogan’s plan to build a Turkish-made fighter jet. The jet deal was signed by May in January 2017 under an “open licence” to ease the transfer of military technology, and UK officials now reportedly wish to expand the deal by pushing for Rolls-Royce to win the engine contract. Lloyd Russell-Moyle, a Labour MP who recently travelled to northern Syria, where Turkey is involved in operations against the Kurdish YPG militia, told MEE: “The government has been increasing arms sales to Turkey as it has fallen into authoritarianism at home and warmongering abroad.

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When under fire…

Erdogan Slams Rating Agencies For Upgrading ‘Bankrupt’ Greece (K.)

Turkish President Recep Tayyip Erdogan took a fresh swipe at rating agencies on Friday over the recent downgrade and the negative outlook they have assigned for the Turkish economy, using “bankrupt” Greece as an example. “Don’t pay attention to them [the rating agencies]. They upgraded a neighbour [of Turkey] that has gone bankrupt by four points. They receive new debts and live with them,” he reportedly told the Turkish Union of Chambers and Commodity Exchanges (TOBB) Conference Hall. “Excuse me, but we are talking about a country that cannot pay its civil servants. How is this possible? I am talking about Greece”, he said.

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And the Dutch government is just standing by?!

PDVSA To Shut Curacao Refinery Amid Fight With Conoco (R.)

Venezuela’s state-run oil company PDVSA is preparing to shut a Caribbean refinery that is running out of crude amid threats by ConocoPhillips to seize cargoes sent to resupply the facility, according to two sources with knowledge of the situation. Conoco of the United States last week began legal actions in the Caribbean to enforce a $2 billion arbitration award by the International Chamber of Commerce (ICC) over the 2007 nationalization of its projects in Venezuela. The moves have disrupted fuel deliveries throughout the Caribbean, much of which depends on PDVSA. The PDVSA-operated 335,000 barrel-per-day Isla refinery in Curacao, which has not received new shipments from PDVSA since last week, plans to exhaust existing inventories in the coming days, the two sources said.

PDVSA is seeking ways to sidestep legal orders to hand over assets. The Venezuelan firm has transferred custody over the fuel produced at the refinery to the Curacao government, the owner of the facility, the sources said. In another legal move to avoid oil being seized, PDVSA transferred ownership of crude to be refined at Isla to its U.S. unit, Citgo Petroleum, one of the sources added. “The seizure in Curacao was enforced on Thursday, so the inventories’ custody was transferred. The refinery will eventually stop (operations),” the source said.

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Until the 1980s.

Canada Sued Over Years Of Experimentation On Indigenous People (G.)

A class action lawsuit has been filed in a Canadian court on behalf of the thousands of indigenous people alleged to have been unwittingly subjected to medical experiments without their consent. Filed this month in a courtroom in the province of Saskatchewan, the lawsuit holds the federal government responsible for experiments allegedly carried out on reserves and in residential schools between the 1930s and 1950s. The suit also accuses the Canadian government of a long history of “discriminatory and inadequate medical care” at Indian hospitals and sanatoriums – key components of a segregated healthcare system that operated across the country from 1945 into the early 1980s.

“This strikes me as so atrocious that there ought to be punitive and exemplary damages awarded, in addition to compensation,” said Tony Merchant, whose Merchant Law Group filed the class action. The lawsuit, which has not yet been tested in court, alleges that residential schools – where more than 150,000 aboriginal children were carted off in an attempt to forcibly assimilate them into Canadian society – were used as sites for nutritional experiments, where researchers tested out their theories about vitamins and certain foods. “The wrong here is that nobody knew it was happening. Their families didn’t know it was happening,” Merchant said. As the diet at the schools was known to be nutritionally deficient, the children were considered “ideal experimental subjects”, according to court documents.

It cites six schools, stretching from Nova Scotia to British Columbia, and links them to experiments carried out from 1948 to 1953. At times, researchers would carry out what Merchant described as trials aimed at depriving the children of nutrients that researchers suspected were beneficial. “So what they did on a systemic basis … they would identify a group of indigenous children in schools where they were being compulsorily held and they would not give them the same treatment,” said Merchant. “They used them as a control against experiments that they were doing in other places and they also used them to test certain kinds of foods and drugs.”

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Ban all hunting in Africa. Just stop it.

Maasai Herders Driven Off Land To Make Way For Luxury Safaris (G.)

The Tanzanian government is putting foreign safari companies ahead of Maasai herding communities as environmental tensions grow on the fringes of the Serengeti national park, according to a new investigation. Hundreds of homes have been burned and tens of thousands of people driven from ancestral land in Loliondo in the Ngorongoro district in recent years to benefit high-end tourists and a Middle Eastern royal family, says the report by the California-based thinktank the Oakland Institute. Although carried out in the name of conservation, these measures enable wealthy foreigners to watch or hunt lions, zebra, wildebeest, giraffes and other wildlife, while the authorities exclude local people and their cattle from watering holes and arable land, the institute says.

The report, released on Thursday highlights the famine and fear caused by biodiversity loss, climate change, inequality and discrimination towards indigenous groups. “Losing the Serengeti: The Maasai Land that was to Run Forever” uses previously unpublished correspondence, official documents, court testimonies and first-person testimony to examine the impact of two firms: Thomson Safaris based in the United States, and Otterlo Business Corporation based in the United Arab Emirates. It says Thomson’s sister company, Tanzania Conservation Limited, is in a court battle with three Maasai villages over the ownership of 12,617 acres (5,106 hectares) of land in Loliondo which the company uses for safaris.

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20 years ago already. Imagine today.

Plastic Bag Found At The Deepest Point In The Ocean (SA)

Humanity’s toxic addiction to plastic has reached stunning depths, and we only wish we were speaking figuratively. A new study analysing over 30 years’ worth of data on human-made trash found in the deepest parts of the ocean reveals almost 3,500 pieces of plastic and other debris have been discovered littering these remote, fragile ecosystems. If proof were ever needed that there are no more untouched places left on our poor, polluted planet, we now have it in one perfect, twisted symbol: amongst this litany of garbage, the deepest-lurking refuse was a fragmented single-use plastic bag, discarded at a depth of 10,898 metres (35,754 ft) in the Mariana Trench.

The Mariana Trench is the deepest part of the entire ocean, home to distant, alien forms of marine life we know next to nothing about, but its remote, almost unreachable location doesn’t mean we haven’t found ways to carelessly spoil it [..] In the thousands of debris images and videos the researchers compiled in their database, deep-sea organisms were observed in 17% – damning evidence that our throwaway culture entangles, intermingles, and generally affects ocean life in ways we’re not aware of. Because the team’s dataset only includes a visual record of what’s on the sea floor – not what’s drifting and sinking above it – the researchers say they’ve only scratched the (deep) surface of the problem here, although simple physics suggests more garbage is headed this way.

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Apr 162018
 
 April 16, 2018  Posted by at 9:17 am Finance Tagged with: , , , , , , , , , ,  


James McNeill Whistler Arrangement in Pink, Red and Purple 1883-4

 

US Stock Valuations Are At Multiyear Highs – And Multiyear Lows (MW)
Australia’s Lending Rules Are About to Batter Home Buyers (BBG)
Macron Says He Convinced Trump To Stay In Syria (AFP)
Trump Felt Misled, Angry Over Expulsion Of 60 Russian Diplomats (MW)
Comey And Mueller Have Both Fallen Into Trump’s Trap (MW)
A Third Of People Think Facebook Has A ‘Negative Impact On Society’ (MI)
Who Owns The ‘Virtual You?’ (Escobar)
How Many People Had Their Data Harvested By Cambridge Analytica? (G.)
Where Does the ECB Go From Here? (Mervyn King)
Stoltenberg Calls On NATO Allies To Provide More Support To Turkey (DS)
Detained American Pastor Goes On Trial In Turkey (AFP)
Greek-Turkish Tension ‘Not An Issue For NATO – Stoltenberg (K.)
Greece Is Back in the Spotlight (BBG)
Plastic Is Literally Everywhere: The Epidemic Attacking Australia’s Oceans (G.)

 

 

The new markets.

US Stock Valuations Are At Multiyear Highs – And Multiyear Lows (MW)

With the start of the first-quarter earnings season, U.S. stock-market investors are waiting to see whether the results point to a business environment that is thriving and supportive of the market’s rally over the past several years, or whether the move has been overdone. Turns out, both bulls and bears have data they can marshal in their favor. According to data from FTSE Russell and Thomson Reuters, the U.S. stock market was recently trading at its most expensive levels since the dot-com era, and — even after the first correction for the DJIA and the S&P 500 in about two years — it continues to trade one standard deviation above a historical range. The data is based on the forward price-to-earnings ratio for stocks, which is currently above 17, compared with the long-term average of about 15.

This measure of valuation can be seen mapped out in the following chart. The recent peak of the forward P/E represented a nearly 20-year high, per FTSE Russell.

In another potential warning sign for investors, the cyclically-adjusted price-to-earnings (CAPE) ratio gives the S&P 500 a ratio of 31.6, nearly twice its long-term mean of 16.85, and at its highest level since the dot-com era. Both of these statistics may give investors pause, as they suggest a market’s that is overstretched and could have more room to fall. However, they only tell half the story. The forward P/E comes at a time when first-quarter earnings growth isn’t just expected to be strong, but coming in at its strongest rate in years. According to FactSet, earnings for companies in the S&P 500 are estimated to grow 17.3% in the first quarter, while sales grow 10%. For both, such rates would represent the fastest pace of growth since the first quarter of 2011.

Accounting for that high level of expansion paints a very different picture for stock valuations, so much so that they go from being at or near multiyear highs, to being at multiyear lows. FTSE Russell also provided the following chart to MarketWatch, which looks at the market in terms of its PEG, or a P/E ratio that accounts for earnings growth. Based on this metric, stocks have a PEG of 1.2, which means they’re not only trading one standard deviation below their long-term average of a little more than 1.3, but also at their cheapest level since 2012.

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Really? Killing the golden eggs?

Australia’s Lending Rules Are About to Batter Home Buyers (BBG)

A toughening of lax lending standards in Australia is threatening an already-cooling property market. An inquiry into misconduct in the financial industry is likely to lead to greater regulation of the nation’s A$1.6 trillion ($1.2 trillion) mortgage market. Banks have routinely relied on an unrealistically low estimate of homebuyers’ living expenses, and a more genuine assessment of spending could reduce borrowing power by as much as 35 percent, according to UBS analysts. That would mean many new buyers simply couldn’t afford current prices – a further drag on home prices that are already falling as a seven-year property boom tails off.

“What drives house prices is credit availability,” said Sean Fenton, director at Sydney-based Tribeca Investment Partners, which manages about A$2.5 billion. “A tightening of lending standards directly impacts the ability of the marginal buyer to buy a house.” The heat is already coming out of the housing market. Prices in Sydney, the world’s second-most expensive property market, fell 2.1 percent in March from a year earlier, according to CoreLogic Inc. A year ago, annual price growth was running at almost 16 percent. The top end of the market has recorded the biggest falls, the data shows.

[..] “It’s really obvious that a lot of people have a lot of unmanageable debt,” said Karen Cox, coordinator of Sydney’s Financial Rights Legal Centre, which fielded 25,000 calls last year from people seeking financial help. “Because it’s such a benign interest rate environment, the problems can only get worse.” Based on historic income and price relationships, property prices in Sydney and Melbourne are overvalued by between 25 percent and 30 percent, according to Paul Dales, chief Australian economist at Capital Economics. For now, he’s predicting prices will just edge lower, with the crunch coming if interest rate increases coincide with tighter credit conditions. “All properties in those cities are particularly vulnerable.”

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Macron dreams big. About himself, mostly.

Macron Says He Convinced Trump To Stay In Syria (AFP)

President Emmanuel Macron asserted Sunday that Paris had convinced Donald Trump to stay engaged in Syria “for the long-term”, adding that French air strikes did not amount to a declaration of war against the regime of Bashar al-Assad. A day after France joined the United States and Britain in launching unprecedented strikes against regime targets, Macron insisted the intervention was legitimate and urged international powers to now push for a diplomatic solution to the brutal seven-year war. “We have not declared war on the regime of Bashar al-Assad,” the 40-year-old centrist said at the start of a combative TV interview, stretching nearly three hours, to mark almost a year in office.

But Macron again argued his first major military intervention as president was necessary to send a signal that the use of chemical weapons against civilians would not go unpunished. Saturday’s strikes targeted three alleged chemical weapons facilities in response to what the West says was a gas attack on the town of Douma that killed dozens of people. “We have full international legitimacy in intervening in this case,” Macron said. He said the US, France and Britain targeted “extremely precise sites of chemical weapons use” in an operation that went off “perfectly”. And he further argued the operation was legitimate despite not being sanctioned by the UN, retorting that under a 2013 UN resolution Syria was supposed to destroy its chemical weapons arsenal. As for his allies, Macron suggested France played a pivotal role in changing Trump’s mind on the need to stay involved in the conflict.

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Makes sense.

Trump Felt Misled, Angry Over Expulsion Of 60 Russian Diplomats (MW)

President Donald Trump erupted in anger when he learned the U.S. was expelling 60 Russian diplomats in March, while France and Germany were only expelling four each, the Washington Post reported late Sunday. Trump reportedly only wanted to match the number of allies’ expulsions, and not to be seen as taking the lead. Trump believed his aides misled him, the Post said. “There were curse words,” one official told the Post, “a lot of curse words.” The expulsions were the most ever by the U.S. against Russia, and came in response to a suspected Russian nerve-agent attack on a former spy and his daughter in England. Separately, the Trump administration appears ready to impose more sanctions on Russia. Nikki Haley, the U.S. ambassador to the United Nations, said Sunday that a new round of sanctions will target Russian companies that aid Syria’s chemical weapons capabilities.

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Playing on Trump’s field.

Comey And Mueller Have Both Fallen Into Trump’s Trap (MW)

If there’s any strategy in the world of President Donald Trump, it’s a simple one: Play on my field. And the Trump playing field is a salacious one. The scandals and affairs are literally too numerous to be chronicled in a single article. Large and small, Trump University to Trump Steaks, bankruptcies and legal judgements, all manner of infidelity and aberrant behavior, real or imagined. Former FBI Director James Comey and Special Counsel Robert Mueller were each charged with looking into an allegation of the most serious variety — colluding with a foreign hostile power to alter the presidential election. This week the headlines emanating from Mueller’s investigation, and Comey’s book, involve a porn star, a Playboy bunny, a pee tape, the size of Trump’s hands and a doorman with a history of fibbing apparently alleging the existence of an illegitimate child.

That is playing on Trump’s field. But wait. Isn’t it a violation of campaign law if Trump’s lawyer Michael Cohen paid off Stormy Daniels just ahead of the election? If Cohen used a home-equity loan to fund the payment, did he lie to the bank? Doesn’t it speak to Trump’s truthfulness on a variety of a matters — including alleged collusion with Russia — whether his persistent denials of engaging with prostitutes in Moscow are truthful? Doesn’t it have relevance to the question of whether payoffs were legal if Trump bought off a doorman? And didn’t Mueller actually hand off the investigation on Daniels? Yeah, sure, all of that. Those are all on the level of the Ken Starr investigation into Bill Clinton’s perjury — legal matters, yes, that aren’t really the stuff of high crimes and misdemeanors.

They’re all gotchas reinforcing what we basically knew about Trump and his behavior before the election. By contrast, the consequences of playing on Trump’s field are enormous. For Comey, baiting Trump into a reaction, which sure as water is wet came on Friday morning, will result in better book sales. But it will come at the expense of holding any future higher office. His legacy as FBI director — already tarnished for the ridiculous, torturous inconsistencies in how he handled the investigation into Hillary Clinton’s emails — is forever tarnished. Who in Washington could hire this guy? “Untruthful,” as Trump called him? No. “Slime ball?” Hmm.

Mueller, too, looks set to emerge damaged, if perhaps not as fatally. The question of whether Trump can, or should, fire him has returned. Mueller, also a former FBI director, does still have the support of both House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell to finish his investigation, and a few key Republicans, including Sen. Chuck Grassley, have expressed willingness to support legislation to protect him. But the idea of his dismissal is definitely more plausible — and, for that matter, the outrage it would generate a good bit lessened.

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“..how does it affect children, how does the platform create addiction..”

A Third Of People Think Facebook Has A ‘Negative Impact On Society’ (MI)

Here’s another bone to pick with Facebook. Nearly one-third of Americans (31.7%) think the embattled social network is having a “negative impact on society,” according to a survey conducted in recent months by CEO Mark Zuckerberg’s former personal pollster, Tavis McGinn. That view was even more widely held among respondents in Australia (33.4%), Canada (33.3%) and the U.K. (32.2%), per the results reported by Recode. The survey research was conducted on 10,000 respondents across 10 nations in January and February, prior to recent revelations that the British data firm Cambridge Analytica had improperly harvested personal data from up to 87 million Facebook users to create targeted political ads.

Facebook had already come under fire for its role in the proliferation of fake news on the platform during the 2016 election. While McGinn and his Honest Data company didn’t delve into specifics of this “negative” societal impact, the pollster had some ideas. “In the U.S. obviously we’re very focused on election interference, and in the U.K. they’ve been focused on that as well with Brexit,” he told Recode. “But there are also things like, ‘how does it affect children, how does the platform create addiction, how does the platform encourage extremism, how does the platform push American values onto other countries?’”

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Anyone but you does.

Who Owns The ‘Virtual You?’ (Escobar)

While GAFA in the US essentially controls the politics limiting the capacity for regulation, Brussels will continue to insist the only path towards healthy regulation comes from the EU. The other model is of course China. Beijing has domesticated its sprawling digital industry – which is a de facto extension of the state apparatus as well as a growing instrument of global influence. When Zuckerberg was asked whether Facebook should be broken up – the monopoly issue once again – he said that would weaken the US’s competitive advantage against China, which by the way is fast disappearing. Facebook’s customer base though is not American; it’s global. Inside the Facebook HQ, the consensus is that it is a global company.

So all these issues at stake – from monopoly to regulation to privacy – are indeed global issues. Zuckerberg dodged extremely serious questions. Who owns “the virtual you?” Zuckerberg’s response was that you own all the “content” you upload, and can delete that content any time you want. Yet the heart of the matter is the advertising profile Facebook builds on each user. That simply cannot be deleted. And the user cannot alter it in any way. The GAFA galaxy, in fact, owns you when you click accepting those massive terms and conditions of use. As argued by philosopher Gaspard Koenig, director of the GenerationLibre think tank in France, data property should logically follow the evolution of property rights, land property, financial property and property of ideas, thus replacing the current figure of the “proletarian 2.0” at the heart of the value chain of the digital economy.

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Why would the number be limited to Facebok’s users? Isn’t it clear yet? It’s everyone.

How Many People Had Their Data Harvested By Cambridge Analytica? (G.)

Statistics are a staple of journalistic accuracy issues, but rarely is a number so big, consequential and hard to verify as the number of Facebook users directly affected by the still emerging Cambridge Analytica story. Is it no more than 30 million, as Cambridge Analytica says? Fifty million, as estimated by the Observer and Guardian journalists who have done so much to disclose the issue? Or 87 million, as Facebook has ventured? Facebook’s estimate has a fine-print caveat: “We do not know precisely what data the app shared with Cambridge Analytica or exactly how many people were impacted. Using as expansive a methodology as possible, this is our best estimate of the maximum number of unique accounts that directly installed the thisisyourdigitallife app as well as those whose data may have been shared with the app by their friends.”

The numbers seem to be calculated by multiplying the number of people known as “seeders” by the average number of Facebook friends seeders are thought to have. A seeder was a Facebook user who installed certain apps that permitted the apps’ controllers to harvest data from the user and the seeder’s (unknowing) Facebook friends. The wide variation in the estimates of people affected results partly from different estimates of seeders – 185,000, 275,000, 300,000 – and different average-number-of-friends figures – 160, 180, 250, 340.

Does it matter, in the sense that it is now evident that many, many other entities – academic, commercial, governmental – could have harvested the data of users under previous Facebook policies, for which Mark Zuckerberg, the company’s ethically callow controller, apologised before committees of the US Congress last week, without apparent loss of face? A sense of perspective was given by the Harvard professor Jonathan Zittrain, a sophisticated observer of the social and democratic impacts of digital technologies: “The Cambridge Analytica dataset from Facebook is itself but a lake within an ocean, a clarifying example of a pervasive but invisible ecosystem where thousands of firms possess billions of data points across hundreds of millions of people – and are able to do lots with it under the public radar.”

[..] Is it unreasonable to wonder whether the potential dataset for the team’s work is 2 billion, the total number of Facebook users?

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Former BOE governor sees stormy days ahead. The ECB must save the euro system, and that won’t be easy.

Where Does the ECB Go From Here? (Mervyn King)

Many observers have drawn comfort from the likelihood that Germany’s new “grand coalition” and French President Emmanuel Macron will indeed reform the basic architecture of monetary union. The language will be warm and encouraging, but the substance less so. In recent months I’ve been struck by the dissonance between, on the one hand, a common French and German determination to move ahead on the principle of reform to the monetary union, and, on the other, their governments’ clashing ideas about how to do it. Macron wants a fiscal union and a finance minister for the euro area. Germany doesn’t: It insists that countries must be responsible for their own fiscal position.

The likely compromise is that any fiscal transfers will be kept as small as possible – no larger than needed to get past the immediate problem. That might suffice in reasonably normal times, but not if market confidence disappears as it did in 2010-12. At that point, the issue can no longer be fudged. As these events unfold, Draghi and his successor, due to take over in October 2019, can expect to face many tests. The rise of populist parties in southern Europe is one — but the greatest challenge is likely to come from opinion in Germany. So far, the monetary union has been good for German exporters and politicians but less so for German consumers, who’ve been denied the higher standard of living that an appreciating currency would have delivered.

[..] U.S. President Lyndon B. Johnson famously remarked about his FBI Director J. Edgar Hoover: “It’s probably better to have him inside the tent pissing out, than outside the tent pissing in.” I’ve no doubt Johnson would be strongly recommending the appointment of Jens Weidmann, the current president of the Bundesbank, and I wouldn’t be surprised if Europe’s governments see it the same way. My advice to Jens? Think twice before accepting.

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The NATO Secretary General is a dangerous man. He’s tasked with increasing NATO’s power.

Stoltenberg Calls On NATO Allies To Provide More Support To Turkey (DS)

NATO Secretary General Jens Stoltenberg drew attention to already existing NATO presence in Turkey and called on all allies to provide more support to the country. “We also provide political support, because Turkey is the NATO ally that has suffered the most from terrorist attacks. NATO immediately condemned the coup attempt that targeted Turkey’s democratic institutions,” the secretary-general said. Stoltenberg spoke to Anadolu Agency (AA) at the NATO headquarters in Brussels ahead of his official visit to Turkey on April 16. The NATO chief said the aim of his trip to Ankara is to “to prepare for the upcoming [NATO] summit in Brussels in July..”

[..] Stoltenberg said he highly values the visit to Turkey, as he sees the country it is “a highly valued and key ally for many reasons, not just for its strategic location.” He added that during the visit he will “discuss the preparations for the important summit where we will address issues like how we continue to adapt NATO to a more demanding security environment.” He said that NATO functions with the solidarity principle “one for all and all for one” and added: “We have deployed missile batteries that are augmenting the missile air defenses of Turkey. We have Italy and Spain deploying Patriot batteries and also SAMP-T batteries, and we conduct surveillance flights with our AWACS planes over Turkey. We have also increased our naval presence in the eastern Mediterranean.

[..] When asked about NATO’s approach to Turkey’s Operation Olive Branch in northwestern Syrian region of Afrin, Stoltenberg said NATO welcomed Turkey’s transparency. “We’re aware that there are some challenges related to the situation in northern Syria and around Afrin. NATO has been a platform for direct dialogue between Turkey and the U.S. We recognize Turkey’s legitimate security concerns, which we expect to be addressed in a proportionate and measured way,” NATO chief said. “We all understand that Turkey has to address these threats. We welcome that Turkey has been transparent and briefed NATO several times on the operation in Afrin, both the military operations and the humanitarian assistance.”

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Erdogan gambles on being needed by the US.

Detained American Pastor Goes On Trial In Turkey (AFP)

An American pastor Monday went on trial in Turkey on terror-related charges after spending the last one-and-a-half years behind bars, in a case that has increased friction between Ankara and Washington. Andrew Brunson, who ran a protestant church in the western city of Izmir, was detained by Turkish authorities in October 2016 and then remanded in custody. If convicted, he risks up to 35 years in jail. Brunson, wearing a white shirt and a black suit, was present in court in the town of Aliaga north of Izmir for the hearing, an AFP correspondent said. In an indication of the importance of the case for Washington, also in court were Sam Brownback, the US ambassador at large for religious freedoms, and Senator Thom Tillis.

Turkish prosecutors have charged Brunson with engaging in activities on behalf of the group led by Muslim preacher Fethullah Gulen, who Ankara says is behind the failed 2016 coup, and the Kurdistan Workers’ Party (PKK). Both are banned by Turkey as terror groups. Brunson is also accused of espionage for political or military purposes. If convicted, he faces two separate terms of 15 years and 20 years in prison, his lawyer Cem Halavurt told AFP. [..] The Brunson case has further raised the temperature of heated relations between NATO allies Turkey and the United States, with US President Donald Trump raising the issue in talks with President Recep Tayyip Erdogan. Relations are already tense over American backing for a Kurdish militia in Syria despised by Ankara and the jailing of two employees at American missions in Turkey.

Gulen, who lives in self-exile in the US state of Pennsylvania, firmly denies any role in the failed coup and says his Hizmet (Service) movement promotes a peaceful form of Islam. Turkey has sent a spate of documents to back up its repeated request for Gulen’s extradition from the United States, which has so far shown no sign of interest in expelling the preacher. In September last year, Erdogan suggested that Turkey could free Brunson if Washington handed over Gulen, raising the idea of a swap deal. “They say ‘give us the pastor’. You have a preacher (Gulen) there. Give him to us, and we will try (Brunson) and give him back,” Erdogan said then. The idea was brushed off by the United States.

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Turkey’s a neighbor of Syria. Stoltenberg will have no qualms about selling out Greece.

Greek-Turkish Tension ‘Not An Issue For NATO – Stoltenberg (K.)

The leaders of Greece and Turkey need to address the issues that have been causing tension between the two countries in recent months and this is “not an issue for NATO,” the head of the alliance of which both countries are members said on Sunday. Speaking to Turkey’s Anadolou news agency ahead of a visit to Turkey on Monday, NATO Secretary-General Jens Stoltenberg said that Greece and Turkey are “two highly valued NATO allies” and “both contribute to our collective defense.” “I expect that the differences we see on some issues are solved between Turkey and Greece in the spirit of good relations,” he added.

“In this context, I welcome that the PMs of both countries have recently held a phone conversation and that they have agreed to resolve these differences through dialogue.” Stoltenberg’s visit is planned in preparation for a crucial NATO summit in Brussels in July, “where we will address issues like how we continue to adapt NATO to a more demanding security environment,” he said. Asked to respond to criticism that NATO is not doing enough to help Turkey in its fight against terrorism, Stoltenberg said “there’s a lot of NATO presence in Turkey but I call on the allies to provide even more support.” “We also provide political support, because Turkey is the NATO ally that has suffered the most from terrorist attacks,” the alliance chief told Anadolou.

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Also about Turkey.

Greece Is Back in the Spotlight (BBG)

Consider what Greek Prime Minister Alexis Tsipras is up against. As Greece prepares to free itself from an eight-year European bailout, its 43 year-old premier is confronting challenges at home and abroad. On the domestic front: preparations for post-bailout economic life and the first general election since the end of the program, including feuds with both allies and rivals. On the foreign-policy front: increased tensions with traditional rival Turkey and regional instability stemming from a dispute over a neighboring country’s name. Tsipras’s ability to navigate through all this could determine just how stable the country and its region will be in coming years, experts say, and the European Union, the U.S. and NATO are all watching with interest.

“The worst problem for Tsipras, for the government, but also for Greece is the evolving ‘rogueness’ of Turkey,” said Aristides Hatzis, a professor of law and economics at the University of Athens. “Diminishing American influence on the region is a destabilizing factor and the stakes are very high,” Hatzis said, adding that Greece is not a primary concern for Turkey, but a part of an overall plan by President Recep Tayyip Erdogan to establish hegemony in the region. Tensions between Greece and Turkey escalated in March after two Greek soldiers, who Greece says wandered across the border during a routine patrol, were arrested by Turkey. Greece has demanded their return. Relations between Greece and Turkey, always fraught, worsened further after a Greek court declined to extradite eight Turkish soldiers allegedly involved in a military coup attempt in July 2016.

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“No location and no species is likely to remain immune for any period of time. It is ubiquitous. We are literally drowning in this stuff.”

Plastic Is Literally Everywhere: The Epidemic Attacking Australia’s Oceans (G.)

The scientific literature is awash with research documenting plastics of all sizes in every environment that’s been studied – from the deep ocean to both the Arctic and Antarctic. Microplastic is the term used to describe any piece of plastic less than 5mm wide – it’s mostly the broken-apart remnants of straws, fishing nets and all manner of other plastic items, creating trillions of tiny pieces. Dr Jennifer Lavers, a marine biologist at the Institute for Marine and Antarctic Studies at the University of Tasmania, has spent the past 15 years studying the impacts of plastics.

In 2015 Lavers travelled to one of the most remote spots on the planet – the uninhabited Henderson Island in the middle of the Pacific – to find this world heritage-listed coral atoll’s beaches strewn with an estimated 37m pieces of plastic weighing about 17 tonnes – the equivalent of less than two seconds of global plastic production. Just one washed-up fishing net, barely a decade old, was disintegrating into trillions of plastic fibres that gave the surrounding sand a lucid green splash. “You can’t prepare yourself for moments like that,” she says.

Northern Australia is a known hotspot for these so-called “ghost nets” that are left to haunt the lives of marine animals. One project, GhostNets Australia, has collected more than 13,000 nets since 2004. A study analysed 9,000 nets found in the north of Australia and estimated that they alone had probably caught between 4,866 and 14,600 turtles. “Nowhere is safe, and plastic is literally everywhere,” says Lavers. “No location and no species is likely to remain immune for any period of time. It is ubiquitous. We are literally drowning in this stuff.”

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Mar 272018
 


Paul Klee Cat 1939

 

Dow Surges 670 Points But Stock Market Is On The Brink Of A Breakdown (MW)
Trump Sends To-Do List to China on Trade (WS)
America’s State Wreck Gathers Steam Part 2 (Stockman)
Integrity Has Vanished From The West (Paul Craig Roberts)
Western Allies Expel Scores Of Russian Diplomats Over Skripal Attack (G.)
New Zealand Says It Would Expel Russian Spies … But It Can’t Find Any (G.)
Whistleblower Questions Brexit Result, Says Campaigners Broke Election Law (R.)
Brexit Referendum Campaign Accused of Breaking Spending Rules (BBG)
Theresa May Stands By Adviser Who Outed Brexit Whistleblower (G.)
Underfunded Public Pensions To Persist (R.)
Hood Ornament Buffer (Jim Kunstler)
Meeting Paris Agreement Targets Will Take Massive Cuts in Emissions (BBG)
Ultra-Thin Sun Shield Could Protect Great Barrier Reef (AFP)
Brazil Senate Considers Lifting Ban On Sugarcane Production In Amazon (G.)

 

 

What you’re watching is not real.

Dow Surges 670 Points But Stock Market Is On The Brink Of A Breakdown (MW)

The stock market surged on Monday—and it really needed to. U.S. stocks are coming off the biggest weekly decline in more than two years, and the aftermath of that drop has market technicians warning that major indexes are on the verge of a full-fledged, technical breakdown. “The extent of the deterioration in equities is very much a concern given the combination of near-term technical damage, along with the decline in longer-term momentum after having reached record overbought conditions into late January,” wrote Mark Newton at Newton Advisors, in a Monday research note. Here are some levels that the market is trying to defend or retake after last week’s withering action:

A Dow Theory sell signal was close to forming. According to MarketWatch columnist Mark Hulbert there are a number of steps, but as of Friday, the market had just to see the Dow Jones Transportation Average close below its Feb. 9 low of 10,136.61 to trigger that sell signal after the Dow Jones Industrial Average DJIA, on Friday closed below its February low. On Monday, the transports closed up 2.1% at 10,373.21.

According to data from Michael O’Rourke, chief market strategist at JonesTrading, a little more than half of Dow components were trading below their 200-day moving averages, which hadn’t happened since 2015. Meanwhile, about 50% of the S&P 500 components were trading above their 200-day moving averages, with a break below indicating “notable technical damage has been done to this market,” O’Rourke wrote.

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All obvious.

Trump Sends To-Do List to China on Trade (WS)

Negotiations – led on the US side by Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer, and on the Chinese side by Liu He, a newly anointed vice premier and President Xi Jinping’s top economic adviser – about how to address the gigantic China-US trade imbalance have quietly begun, the infamous “people with knowledge of the matter” told the Wall Street Journal. On Saturday, Mnuchin called Liu, which was confirmed by the Treasury Department. A spokesman said that they “also discussed the trade deficit between our two countries and committed to continuing the dialogue to find a mutually agreeable way to reduce it.” Now Mnuchin is considering a trip to Beijing to pursue the negotiations, one of these people told the Wall Street Journal.

And last week, according to these people, Mnuchin and Lighthizer sent Liu a to-do list on trade with specific items the White House wants China to undertake, including:
• A reduction of the 25% tariffs that China imposes on US-made cars
• Increased purchases by China of US-made semiconductors. China would need to shift these purchases from Japanese and South Korean manufacturers, which aren’t going to be happy
• Reduce subsidies to state-owned enterprises
• Provide more regulatory transparency
• Ease restrictions on US companies in China, particularly requirements that they operate as joint ventures in which the US company’s ownership may be limited to 51%
• Giving US financial firms greater access to the Chinese market.

Clearly, in leaking these negotiations and the existence of this to-do list to the financial press, the White House is hoping to calm the markets, because the last thing it wants is to preside over a stock market plunge, though the stock market has all the best reasons to swoon, and the US-China trade situation isn’t needed to accomplish that.

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“Trump’s new War Cabinet of John Bolton, Mike Pompeo, Gina Haspel and Mad Dog Mattis is arguably the most interventionist, militarist, confrontationist and bellicose national security team ever..”

America’s State Wreck Gathers Steam Part 2 (Stockman)

Last week the Donald’s incipient trade war got Wall Street’s nerves jangling, but that wasn’t the half of what’s coming. To wit, Trump has now essentially formed a War Cabinet and signed a Horribus spending bill that is a warrant for fiscal meltdown. Indeed, the two essentially comprise a self-fueling doom loop which means Washington’s descent into fiscal catastrophe is well-nigh unstoppable; it’s all over except for the screaming in the bond pits. That is, Trump’s new War Cabinet of John Bolton, Mike Pompeo, Gina Haspel and Mad Dog Mattis is arguably the most interventionist, militarist, confrontationist and bellicose national security team ever assembled by a sitting President.

We cannot think of a single country that has even looked cross-eyed at Washington in recent years where one or all four of them has not threatened to drone, bomb, invade or decapitate its current ruling regime. That means Imperial Washington’s rampant War Fever owing to the Dem-left declaration of war on Russia and Putin is now about to be drastically intensified by the complete victory of the neocon-right in the Trump Administration. The result will be sharpened confrontation, if not actual outbreak of hostilities, across the full spectrum of adversaries – Iran, Russia, China, Syria and North Korea – and an escalating tempo of military operations and procurement to implement the policy.

At the same time, the Donald’s pathetic Fake Veto maneuver on Friday cemented the special interest lobbies’ absolute control over domestic appropriations. Of course, Chuckles Schumer and Nancy Pelosi crowed loudly about the $63 billion annual domestic spending increase they got in return for the Donald’s $80 billion defense add-on, but the victory was not partisan; it belonged to the Swamp creatures who suckle the politicians of both parties and own the appropriations committees lock, stock and barrel.

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TV was just a first step in creating opinions from scratch. We can do much more than that now. Will we still curtail Facebook, Google?

Integrity Has Vanished From The West (Paul Craig Roberts)

Among Western political leaders there is not an ounce of integrity or morality. The Western print and TV media is dishonest and corrupt beyond repair. Yet the Russian government persists in its fantasy of “working with Russia’s Western partners.” The only way Russia can work with crooks is to become a crook. Is that what the Russian government wants? Finian Cunningham notes the absurdity in the political and media uproar over Trump (belatedly) telephoning Putin to congratulate him on his reelection with 77% of the vote, a show of public approval that no Western political leader could possibly attain. The crazed US senator from Arizona called the person with the largest majority vote of our time “a dictator.” Yet a real blood-soaked dictator from Saudi Arabia is feted at the White House and fawned over by the president of the United States.

The Western politicians and presstitutes are morally outraged over an alleged poisoning, unsupported by any evidence, of a former spy of no consequence on orders by the president of Russia himself. These kind of insane insults thrown at the leader of the world’s most powerful military nation—and Russia is a nation, unlike the mongrel Western countries—raise the chances of nuclear Armageddon beyond the risks during the 20th century’s Cold War. The insane fools making these unsupported accusations show total disregard for all life on earth. Yet they regard themselves as the salt of the earth and as “exceptional, indispensable” people.

Think about the alleged poisoning of Skirpal by Russia. What can this be other than an orchestrated effort to demonize the president of Russia? How can the West be so outraged over the death of a former double-agent, that is, a deceptive person, and completely indifferent to the millions of peoples destroyed by the West in the 21st century alone. Where is the outrage among Western peoples over the massive deaths for which the West, acting through its Saudi agent, is responsible in Yemen? Where is the Western outrage among Western peoples over the deaths in Syria? The deaths in Libya, in Somalia, Pakistan, Ukraine, Afghanistan? Where is the outrage in the West over the constant Western interference in the internal affairs of other countries? How many times has Washington overthrown a democratically-elected government in Honduras and reinstalled a Washington puppet?

The corruption in the West extends beyond politicians, presstitutes, and an insouciant public to experts. When the ridiculous Condi Rice, national security adviser to president George W. Bush, spoke of Saddam Hussein’s non-existent weapons of mass destruction sending up a nuclear cloud over an American city, experts did not laugh her out of court. The chance of any such event was precisely zero and every expert knew it, but the corrupt experts held their tongues. If they spoke the truth, they knew that they would not get on TV, would not get a government grant, would be out of the running for a government appointment. So they accepted the absurd lie designed to justify an American invasion that destroyed a country.

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Diplomats are stationed abroad to make communication possible. This does not help.

Western Allies Expel Scores Of Russian Diplomats Over Skripal Attack (G.)

The US has ordered the expulsion of 60 Russian officials who Washington says are spies, including a dozen based at the United Nations, and told Moscow to shut down its consulate in Seattle, which would end Russian diplomatic representation on the west coast. The EU members Germany, France and Poland are each to expel four Russian diplomats with intelligence agency backgrounds. Lithuania and the Czech Republic said they would expel three, and Denmark, Italy and the Netherlands two each. Estonia, Latvia, Croatia, Finland, Hungary, Sweden and Romania each expelled one Russian. Iceland announced it would not be sending officials to the World Cup in Russia.

Ukraine, which is not an EU member, is to expel 13 Russian diplomats, while Albania, an EU candidate member, ordered the departure of two Russians from the embassy in Tirana. Macedonia, another EU candidate, expelled one Russian official. Canada announced it was expelling four diplomatic staff serving in Ottawa and Montreal who the Canadian government said were spies. A pending application from Moscow for three more diplomatic posts in Canada is being denied. Australia confirmed that it too would expel two Russian diplomats who were in the country as undeclared intelligence officers, giving them seven days to leave.

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Someone will find some for them.

New Zealand Says It Would Expel Russian Spies … But It Can’t Find Any (G.)

New Zealand’s prime minister, Jacinda Ardern, and foreign affairs minister, Winston Peters, say they would expel Russian spies from the country, if there were any. More than 100 Russian diplomats alleged to be spies in western countries have been told to return to Moscow, in response to the use of a chemical weapon in the attempted murder of Sergei Skripal, a former Russia/UK double agent, and his daughter, Yulia, in Salisbury, England on 4 March. The New Zealand government has condemned the attack and supports the international action, but says there are no such “Russian intelligence agents” in the country.

The Russian ambassador to New Zealand was summoned to a meeting “to reiterate our serious concern” over the Salisbury attack. “While other countries have announced they are expelling undeclared Russian intelligence agents, officials have advised there are no individuals here in New Zealand who fit this profile. If there were, we would have already taken action,” said Ardern. She said New Zealand will review what further action it can take to support the international community over the attack. “We remain steadfast with our international partners in our shared concern about the Salisbury nerve agent attack,” Ardern said.

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There are tw0 such whistleblowers now. Here’s no. 1:

Whistleblower Questions Brexit Result, Says Campaigners Broke Election Law (R.)

A whistleblower at the heart of a Facebook data scandal on Monday questioned the result of Britain’s 2016 Brexit referendum as his lawyers presented evidence that they said showed the main campaign for leaving the EU had broken the law. With just a year until Britain is due to leave the European Union, two whistleblowers – one from the British political consultancy Cambridge Analytica and one from the Vote Leave group – have alleged that Brexit campaigners funded their campaign illegally. By doing so, they have pulled Brexit into a scandal that has forced Mark Zuckerberg to apologise for how Facebook handled users’ data, and raised questions about how Donald Trump’s 2016 campaign employed data.

Vote Leave officials on Monday denied breaking election rules and said they were facing an attempt to undermine Brexit by smearing their reputations. The whistleblowers’ law firm, London-based Bindmans, released 53 pages of selected evidence on Monday. In a legal opinion, Bindmans said there was a prima facie case that Vote Leave broke election spending limits by donating to an allied group known as BeLeave, with which it was working closely.

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And this is no. 2:

Brexit Referendum Campaign Accused of Breaking Spending Rules (BBG)

Campaigners for Brexit may have conspired to break spending limits in the U.K.’s 2016 referendum on European Union membership, according to allegations by a whistle-blower who worked for one of the Leave groups. Vote Leave, the main pro-Brexit campaign, gave money to a smaller campaign group, BeLeave, and then helped direct how it was spent, according to a 50-page legal opinion by attorneys from London’s Matrix Chambers. The lawyer are acting on behalf of people who flagged potential violations in the campaign.

If that 625,000-pound ($889,000) donation had been included in Vote Leave’s accounts, it would have taken the group over its 7 million-pound spending limit. “It’s important that it’s the will of the people and not the bought will of the people that is expressed at the ballot box,” Tamsin Allen told reporters at a briefing Monday afternoon in London. Allen is a lawyer for Shahmir Sanni, a BeLeave campaigner who argues the rules were broken.

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No. 2 was outed as gay by his own government as revenge for being a whistleblower. His family in Pakistan has hired security.

Theresa May Stands By Adviser Who Outed Brexit Whistleblower (G.)

Theresa May has insisted her political secretary, Stephen Parkinson, “does a very good job”, as he faces mounting pressure over the outing of the Brexit whistleblower Shahmir Sanni. Sanni said he had endured one of the “most awful weekends” of his life after telling the Observer how Vote Leave channelled money through BeLeave, a group linked to Cambridge Analytica, to get around electoral law. On Friday Sanni was outed as gay by Parkinson, one of May’s closest advisers and a former Vote Leave official, with whom Sanni had a relationship during the campaign. Privately, some Conservative MPs believe Parkinson should stand down. “He’ll have to go,” said one backbencher.

The Labour MP Ben Bradshaw challenged the prime minister in the House of Commons on Monday about what Downing Street said was a “personal statement” by Parkinson. “How is it remotely acceptable that when a young whistleblower exposes compelling evidence of law-breaking by the leave campaign, implicating staff at No 10, one of those named instead of addressing the allegations issues an officially sanctioned statement outing the whistleblower as gay and thereby putting his family in Pakistan in danger?” he said. “It’s a disgrace, prime minister, you need to do something about it.”

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As sure as death and taxes.

Underfunded Public Pensions To Persist (R.)

Investment returns have been uneven and funding levels have yet to recover. Many pension funds have meanwhile attempted to boost returns by loading up on alternative investments to levels unheard of a decade earlier. “Some just cannot grow their way out of it. We have had several years of stellar (stock market) returns and it barely improved the underfunding situation,” said Mikhail Foux, municipal credit analyst at Barclays in New York. The benchmark S&P 500 U.S. stock index has tripled in the past nine years, driven in part by unprecedented zero interest rate policies and massive monetary stimulus from central banks around the globe aimed at combating the deepest recession in a generation.

But pension returns struggled to match the broad market, and recent wobbles in U.S. equities have fed fears of another downturn. “Now what happens when markets are falling 10 to 15%?” Foux asked. In 2007, a year before the crisis began, the median funded level was 92% for state retirement and 97% for local plans, according to Wilshire Funding Studies. That fell to 68% for states and 72% for local governments by 2016, the most recent data. A lower funded ratio indicates the overall soundness of a pension fund is weaker and more money is required to meet future obligations.

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Best description yet of Stormy. Big announcements and an empty interview. Presidents showing their virility makes them more popular, not less. Ask France.

Hood Ornament Buffer (Jim Kunstler)

Newsflash: President Donald J. Trump had sex with a whore twelve years ago. Let that sink into your limbic lobes, you poor, opiated, Facebook-addled, morbidly-obese, fly-over nation of lumbering, deplorable, gun-gripping, Jesus-haunted voters. A hoor! Do you hear? Wait a minute, you say. Stormy Daniels is no such thing, She’s an actress in, and director of, adult films, an auteur, if you like, at least a sex worker, toiling in the rolling mills of eros, sweating and grunting as much as any Mahoning Valley steel worker, or hood ornament buffer on the Tesla assembly line. And anyway, three times over the years she denied having sex with that man, at least once in writing, though last night on CBS’s Sixty Minutes she stated that she actually did have sex with the Golden Golem of Greatness.

In which case, she may be some kind of a lyin’ hoor… or savior of a nation yearning to cast off the loathsome rule of this odious president-by-mistake. The Sixty Minutes make-up and costume crew knocked themselves out coming up with her on-camera look Sunday night: WalMart Shopper. That reddish blouse, for instance, which did not display Stormy’s… er… assets in the usual way (i.e., an enticing fleshy slot descending into deep milky realms of mystery), but just innocently swimming around in there like a couple of frolicking dolphins confined in an above-the-ground backyard pool. Who wouldn’t want to jump in and swim with them? Maybe not the undistractible Anderson Cooper, who did ferret out many interesting particulars of that one romantic encounter: Stormy accepted Trump’s invitation for dinner… in his hotel suite. Just the two of them, ahem.

They watched a TV show about sharks. It apparently lacked aphrodisiac punch. So he showed her a magazine with his picture on the cover, perhaps to get the point across that he was a really important person in case she didn’t already know. She said she ought to take it and spank him with it. He concurred, dropped trou, and presented the rear of his tighty-whitey small-clothes to facilitate that proposal. After that ice-breaker, he said, “I really like you!” and “You remind me of my daughter” — instantly be-sliming the proceedings with overtones of incest. Stormy went to the bathroom and emerged to find Trump perched on the bed. “Here we go,” the thought popped into her head, she says. But she didn’t say “no.”

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Not going to happen. Paris was just meant to make you feel good.

Meeting Paris Agreement Targets Will Take Massive Cuts in Emissions (BBG)

Meeting the Paris accord’s temperature targets will take massive cuts to greenhouse gas emissions within 15 years, but won’t require them to be reduced to zero, according to a new study published Monday in the journal Nature Climate Change. If those targets—between 1.5 to 2ºC (2.7 to 3.6ºF)—are overshot, the consequences would likely require both drastic cuts to emissions and geoengineering efforts to remove carbon from the atmosphere, according to the paper by Katsumasa Tanaka at the National Institute for Environmental Studies in Japan and Brian O’Neill at the U.S. National Center for Atmospheric Research. “If we overshoot the temperature target, we do have to reduce emissions to zero. But that won’t be enough,” Tanaka said in a statement.

“We’ll have to go further and make emissions significantly negative to bring temperatures back down to the target by the end of the century.” Tanaka’s team began looking at both the accord’s temperature goals and requirement that countries “achieve net-zero greenhouse gas emissions in the second half of this century,” according to the statement. The scientists created scenarios that would achieve both the temperature goals and emissions guidelines. The group concluded to do so would necessitate cutting emissions 80% by 2033 to meet the 1.5 degree target or about 66% by 2060 to meet the 2 degree mark. “In both these cases, emissions could then flatten out without ever falling to zero,” according to the statement.

[..] The United Nation’s Intergovernmental Panel on Climate Change is working on a report which is expected to conclude that geoengineering will be needed to meet the 1.5 degree goal. Recognizing this difficulty, Tanaka and O’Neill looked at the possibility the targets would be missed. If the 1.5-degree mark is missed, emissions would have to fall to zero by 2070 and then be negative for the rest of the century. In the 2-degree scenario emissions would have to drop to zero by 2085 and then stay negative for a shorter period of time to get back below 2 degrees. Both scenarios would require removing carbon from that atmosphere. The researchers also looked at scenarios reducing emissions to zero by 2060 and 2100. In the first case, the temperature rose 2 degrees before declining. In the second instance, it rose above that mark by 2043 and stayed there for 100 years or more.

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Yes, of course. We’ll cover the ocean in plastic, just as we do our food. And then ourselves.

Ultra-Thin Sun Shield Could Protect Great Barrier Reef (AFP)

An ultra-fine biodegradable film some 50,000 times thinner than a human hair could be enlisted to protect the Great Barrier Reef from environmental degradation, researchers said Tuesday. The World Heritage-listed site, which attracts millions of tourists each year, is reeling from significant bouts of coral bleaching due to warming sea temperatures linked to climate change. Scientists from the Australian Institute of Marine Biology have been buoyed by test results of a floating “sun shield” made of calcium carbonate that has been shown to protect the reef from the effects of bleaching. “It’s designed to sit on the surface of the water above the corals, rather than directly on the corals, to provide an effective barrier against the sun,” Great Barrier Reef Foundation managing director Anna Marsden said.

The trials on seven different coral types found that the protective layer decreased bleaching of most species, cutting off sunlight by up to 30 percent. “It (the project) created an opportunity to test the idea that by reducing the amount of sunlight from reaching the corals in the first place, we can prevent them from becoming stressed which leads to bleaching,” Marsden said. Researchers from a breadth of disciplines contributed to the project, which was headed by the scientist who developed the country’s polymer bank notes. “In this case, we had chemical engineers and experts in polymer science working with marine ecologists and coral experts to bring this innovation to life,” Marsden said.

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Yeah, just great. The entire deterioration process of teh planet is fast accelerating.

Brazil Senate Considers Lifting Ban On Sugarcane Production In Amazon (G.)

A bill being rushed through Brazil’s senate would lift a ban on the cultivation of sugarcane for ethanol fuel in the Amazon, driving more deforestation and making it harder for the country to meet its commitments under the Paris Climate Deal. The bill, which has been roundly condemned by environmentalists, companies and even Brazil’s union of sugarcane producers (UNICA), marks the latest move by a conservative congress to unravel Amazon protections. Five former environment ministers have also criticised it. “This is another setback that should not thrive,” said one, José Carvalho. Under a 2009 decree, sugar cane production is not allowed in the Amazon biome.

Allowing the highly-profitable crop to be raised on deforested land in the region would push out other crops and encourage more deforestation, said Marcio Astrini, public policy coordinator for Greenpeace in Brazil. It could be “one of the biggest disasters for the forest,” he said. The bill was first introduced in 2011 by Flexa Ribeiro, a senator for the centre-right Brazilian Social Democratic party in the Amazon state of Pará, and suddenly put up for a vote on Tuesday afternoon. It would allow ethanol production on vaguely-defined areas of Amazon land, including “altered areas” and “general land”. If approved on Tuesday and given presidential sanction, it could become law. Brazil’s ethanol fuel is seen as a clean fuel alternative to gasoline by millions of motorists. According to UNICA, 27m cars in Brazil, 73% of the total can use either gasoline or ethanol, as can 4m motorbikes.

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Mar 232018
 
 March 23, 2018  Posted by at 9:48 am Finance Tagged with: , , , , , , , , , ,  


Edvard Munch Spring 1889

 

China Hits Back on Trump Tariffs as Europe Off the Hook for Now (BBG)
Asian Stocks Plunge As Trump’s Trade War Heats Up (MW)
Dow Jones Closes Down More Than 700 Points (Ind.)
UK Politicians To Be Exempt From Data Crackdown (Ind.)
Steve Bannon: ‘Facebook Data Is For Sale All Over The World’ (G.)
Facebook Gave Data About 57 Billion Friendships To Academic (G.)
The Digital Military Industrial Complex (NYBooks)
EU Countries Prepare To Follow May And Expel Russian Diplomats (G.)
Number Of British Children In Poverty Surges By 100,000 In A Year (Ind.)
UK Rebel Bank Prints Its Own Notes And Buys Back People’s Debts (G.)
Shaking the Superflux (Varoufakis)
‘Great Pacific Garbage Patch’ 16 Times Larger Than Previously Estimated (G.)
Great Pacific Garbage Patch Is Rapidly Accumulating Plastic (Nature)
‘Collapse Of Civilisation Is A Near Certainty Within Decades’ – Ehrlich (G.)
Mammoth Survey Of Nature’s Vital Signs Released (AFP)

 

 

All involved know a realignment was inevitable. This is simply the art of the deal.

China Hits Back on Trump Tariffs as Europe Off the Hook for Now (BBG)

The trade conflict between China and the U.S. escalated, with Beijing announcing its first retaliation against metals levies hours after President Donald Trump outlined fresh tariffs on $50 billion of Chinese imports and pledged there’s more on the way. On Friday, China unveiled tariffs on $3 billion of U.S. imports in response to steel and aluminum duties ordered by Trump earlier this month. The White House then declared a temporary exemption for the European Union and other nations on those levies, making the focus on China clear. Though Beijing’s actions so far are seen by analysts as measured, there may be more to come.

Equity indexes from Tokyo to Shanghai tumbled more than 3% and U.S. stock futures fell, signaling a further retreat for the S&P 500 Index after it fell 2.5%, on risks a further escalation in trade tensions will undermine an unusual phase of synchronized global economic growth. Suppliers to Apple were among the hardest hit in Hong Kong and mainland markets on Friday, as investors focused on potential losers from the trade spat. “China’s response is surprisingly modest in light of the U.S. actions, suggesting there could be a good deal more to come,” said Stephen Roach, a former non-executive chairman for Morgan Stanley in Asia and now a senior fellow at Yale University. “As America’s third largest and most rapidly growing export market and as the largest foreign owner of Treasuries, China has considerably more leverage over the U.S. than Washington politicians care to admit.”

[..] The White House gave the European Union, Argentina, Australia, Brazil, Canada, Mexico, and South Korea, until May 1 to negotiate levies on steel and aluminum. The administration said the suspensions can be renewed or revoked then, “pending discussions of satisfactory long-term alternative means to address the threatened impairment to U.S. national security.” “This has been long in the making,” Trump said signing the intellectual-property order, adding that the tariffs could affect as much as $60 billion in goods. He told reporters, “This is the first of many.”

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There’ll be a bit of to and fro, with big words and big numbers and big threats, and then everyone will get back to business.

Asian Stocks Plunge As Trump’s Trade War Heats Up (MW)

The global equities swoon rolled over to Asia on Friday, where markets reacted negatively to the Trump administration’s trade broadside against China. Although the import tariffs had been telegraphed for weeks, Thursday’s package, covering about $60 billion in goods, sent investors running for havens. Bonds and gold prices rose and the Japanese yen hit its highest point against the U.S. dollar since Donald Trump won the presidential election. “Yes, the news was out for a while, but the actual action was a bit of a surprise to the market,” said Shinchiro Kadota, a senior forex and rates strategist at Barclays. “Maybe they thought it would be smaller, maybe later.”

China’s commerce ministry responded Friday morning and announced it would levy tariffs against $3 billion worth of U.S. goods including pork and recycled aluminum. Japan’s Nikkei Stock Average closed down 4.5% as the yen’s sharp gains on Thursday also pressured stocks lower. The yen rose further on Friday, hitting 16-month highs as the dollar went below ¥105. The WSJ Dollar Index fell 0.2% in Asia, extending the afternoon pullback seen during U.S. trading. Stocks in China also fell with the Shanghai Composite Index down 4%, the Shenzhen Composite Index down 5.3% and the small-cap-heavy Chinext Index down 5.1%.

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Realignment.

Dow Jones Closes Down More Than 700 Points (Ind.)

The Dow Jones Industrial Average closed down more than 700 points, with investors fearing that trade tensions will spike between the US and China after President Donald Trump unveiled new tariffs against Beijing. Industrial and technology companies, which depend heavily on foreign trade, took some of the worst losses with Boeing, Caterpillar and Microsoft all falling sharply. The Dow sank 724 points, or 2.9%, to 23,957. The Nasdaq lost 178 points, or 2.4%, to 7,166. The S&P 500 index dropped 68 points, or 2.5%, to 2,643, erasing its gain for the year. It is the fifth-worst daily point drop ever for the Dow and the worst since the beginning of February.

Earlier on Thursday, Mr Trump unveiled a plan to impose up to $60bn in new tariffs on Chinese goods, as well as limiting the country’s investment in the US as payback for what his administration alleges is years of intellectual property theft. The president’s order – which report from the White House had previously suggested would be nearer $50bn – is likely to trigger retaliation by Beijing and could further stoke fears of a global trade war. Just before signing the trade action, Mr Trump said it was “the first of many” as he looks to correct what has repeatedly called “unfair” trade deals with nations around the world.

“Markets are saying that these tariffs are going to cut into the global growth story that looked pretty strong just a few weeks ago. The prospect of more tariffs is making markets very unsettled and you’re going to see choppy trading until we see the effect they are having on earnings,” Jamie Cox, a managing partner for Harris Financial Group told Reuters.

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All you need to know about the Cambridge Analytica outrage. It’s theater.

UK Politicians To Be Exempt From Data Crackdown (Ind.)

Britain’s political parties are poised to grant themselves special powers to use personal data to find out how people are likely to vote, despite the Cambridge Analytica scandal, The Independent can reveal. Legislation set to clear Parliament within weeks will allow the profiling of voters to help infer their political opinions, privacy campaigners have warned. The move comes as controversy has engulfed Cambridge Analytica over its collection of Facebook data, with the aim of using it to profile and target people during election campaigns. Even before the scandal erupted, political parties had faced questions about their use of social media to carry out online campaigning.

All the major parties have agreed to the exemption from new data protection laws, arguing it clarifies their widely recognised right to canvas voters in order to target possible supporters. But critics say technological advances now enable such data to be mined to discover people’s opinions without their active consent. Organisations outside of the main political parties will be barred from collating voting data in this way. Ailidh Callander, a lawyer at the group Privacy International, told The Independent that “no meaningful justification” had been given for the powers in the Data Protection Bill. “This exemption is open to abuse by political parties and those working for them and can be used to facilitate targeted and exploitative political advertising,” she warned.

[..] “As we can see from the work of Cambridge Analytica, personal data that might not have previously revealed political opinions can now be used to infer information about the political opinions of an individual,” Ms Callander added. It would allow private firms, under contract to political parties, to “process personal data revealing political opinions for a wide range of purposes” without the explicit consent of the person concerned, Ms Callander said. Mr Bernal said data that could reveal voting preferences should be given “more protection”, warning: “Almost anything can be used to at least have a guess at your political leanings.”

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Business model. And if anyone can buy this stuff, you wonder what the NSA keeps for itself.

Steve Bannon: ‘Facebook Data Is For Sale All Over The World’ (G.)

Steve Bannon tried to distance himself from the Cambridge Analytica scandal on Thursday, claiming: “I didn’t even know anything about the Facebook mining.” Bannon is a former vice-president and board member of the political consultancy, which he agreed he “put together.” He claimed to a conference in New York that neither he nor Cambridge Analytica had anything to do with “dirty tricks” in the use of information harvested from Facebook to make computer models to sway elections. Besides, he said, “Facebook data is for sale all over the world”.

Bannon – Donald Trump’s former chief strategist – later said outside the conference room that he “did not remember” being part of any scheme to buy data that came from Facebook and divert it to use for election propaganda, as the Observer revealed last weekend. He blamed any “dirty tricks” on Cambridge Analytica’s parent company, SCL, which he described as “the British guys, old Etonians and guys from Oxford and Cambridge” [..] Bannon denied there was any scandal involving companies acquiring people’s personal information from Facebook and using it for other purposes.

“It’s just about the cost of it. It’s bought and sold every day, it’s just a marketplace,” he said, adding: “I didn’t even know about the Facebook mining, that’s Facebook’s business … They went to Barack Obama’s campaign in 2008 and told him all about the power of personal data.” Bannon turned to the conference audience and said: “You’re all serfs. Well paid serfs, but still serfs … The data is all out there, they [Facebook] take your stuff for free and monetize it for huge margins, they take over your life.”

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About that claim that Facebook was cheated, it wasn’t. It was always part of the whole thing. This is not something Kogan ‘harvested’, Facebook had already done that.

Facebook Gave Data About 57 Billion Friendships To Academic (G.)

Before Facebook suspended Aleksandr Kogan from its platform for the data harvesting “scam” at the centre of the unfolding Cambridge Analytica scandal, the social media company enjoyed a close enough relationship with the researcher that it provided him with an anonymised, aggregate dataset of 57bn Facebook friendships. Facebook provided the dataset of “every friendship formed in 2011 in every country in the world at the national aggregate level” to Kogan’s University of Cambridge laboratory for a study on international friendships published in Personality and Individual Differences in 2015. Two Facebook employees were named as co-authors of the study, alongside researchers from Cambridge, Harvard and the University of California, Berkeley. Kogan was publishing under the name Aleksandr Spectre at the time.

A University of Cambridge press release on the study’s publication noted that the paper was “the first output of ongoing research collaborations between Spectre’s lab in Cambridge and Facebook”. Facebook did not respond to queries about whether any other collaborations occurred. “The sheer volume of the 57bn friend pairs implies a pre-existing relationship,” said Jonathan Albright, research director at the Tow Center for Digital Journalism at Columbia University. “It’s not common for Facebook to share that kind of data. It suggests a trusted partnership between Aleksandr Kogan/Spectre and Facebook.”

Facebook downplayed the significance of the dataset, which it said was shared with Kogan in 2013. “The data that was shared was literally numbers – numbers of how many friendships were made between pairs of countries – ie x number of friendships made between the US and UK,” Facebook spokeswoman Christine Chen said by email. “There was no personally identifiable information included in this data.”

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Excellent long background by Tamsin Shaw for the Facebook story. It’s a who’s who.

The Digital Military Industrial Complex (NYBooks)

In a 2014 interview, Lt. Gen. Michael Flynn, speaking then as head of the Defense Intelligence Agency, said that such open-source data initiatives, and in particular the study of social media such as Facebook, had entirely transformed intelligence-gathering. He reported that traditional signals intelligence and human intelligence were increasingly being replaced by this open-source work and that the way in which intelligence agents are trained had been modified to accommodate the shift. A growing portion of the military’s $50 billion budget would be spent on this data analytics work, he claimed, creating a “gold rush” for contractors. A few weeks after this interview, Flynn left the DIA to establish the Flynn Intel Group Inc. He later acted as a consultant to the SCL Group.”

Carole Cadwalladr reported in The Observer last year that it was Sophie Schmidt, daughter of Alphabet founder Eric Schmidt, who made SCL aware of this gold rush, telling Alexander Nix, then head of SCL Elections, that the company should emulate Palantir, the company set up by Peter Thiel and funded with CIA venture capital that has now won important national security contracts. Schmidt threatened to sue Cadwalladr for reporting this information. But Nix recently admitted before a parliamentary select committee in London that Schmidt had interned for Cambridge Analytica, though he denied that she had introduced him to Peter Thiel. Aleksandr Kogan and Christopher Wylie allowed Cambridge Analytica to evolve into an extremely competitive operator in this arena.

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Proof is overrated.

EU Countries Prepare To Follow May And Expel Russian Diplomats (G.)

EU leaders have thrown their weight behind Theresa May’s stance on Russia, with several countries poised to announce expulsions of diplomats, in a bid to dismantle Vladimir Putin’s spy network. Following a summit in Brussels to discuss the response to the Salisbury nerve agent attack, EU leaders gave their full-throated backing to the prime minister by adopting a statement declaring it was “highly likely Russia is responsible” for poisoning Sergei Skripal and his daughter, Yulia. Donald Tusk, the president of the European council, tweeted that all leaders agreed Russia’s responsibility for the attack was highly likely. In a significant point for May, the statement goes further than a declaration by foreign ministers earlier this week, which avoided pinning the blame on Russia.

British diplomats believe that a strong message of solidarity with the UK, from Russia’s closest European neighbours, will hit home with President Putin. France, Poland, Estonia, Latvia and Lithuania are understood to be considering expelling Russian diplomats, as requested by the UK government, in a coordinated strike against Moscow. The Lithuanian president, Dalia Grybauskaite, said: “All of us, we are considering such measures.” She added that she had not congratulated Putin on his election victory. EU leaders discussed their response to the Salisbury poisoning over a European council summit dinner in Brussels. The UK prime minister told her fellow leaders the attack formed part of a long-term pattern of behaviour by Russia, and urged them to present a united front.

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What all the talk about Russia serves to hide…

Number Of British Children In Poverty Surges By 100,000 In A Year (Ind.)

The number of children in poverty across the UK has surged by 100,000 in a year, new figures show, prompting calls for ministers to urgently review cuts to child welfare. Government statistics published on Thursday show 4.1 million children are now living in relative poverty after household costs, compared with four million the previous year, accounting for more than 30% of children in the country. Compared to the overall population, children remained the most likely to be in relative poverty, at almost one in three compared with 21% of working age adults and 16% of pensioners.

The figures will fuel concerns that benefit cuts and tax credits under the Tory Government are seeing children hardest hit, with around one and a half million more under-18s forecasted to live in households below the relative poverty line by 2022. Relative child poverty is measured as children living in homes where the income is 60% of the median household income in the UK, adjusted for family size and after housing costs. Separate government statistics published on Thursday show the number of households in temporary accommodation has surged 64% since the Tories came to power in 2010, of which more than 2,000 had children.

Responding to the rise in child poverty levels, Labour MP Margaret Greenwood, the Shadow Work and Pensions Secretary, said: “These figures show that after eight years of Conservative austerity, Labour’s progress in tackling child poverty has been reversed with a shocking increase in the numbers of children living in poverty.

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Don’t get too successful, or else…

UK Rebel Bank Prints Its Own Notes And Buys Back People’s Debts (G.)

First there were the banks. Sending credit cards through the post, offering easy loans. They overstretched, teetered. Then came the billion-dollar bailouts, recession, austerity, poverty and payday loans. Then, slowly, came the movement: a piecemeal, sporadic effort to buy back the debt of ordinary people. Now in north-east London, an enterprise that is part art installation, part stunt and part charitable endeavour, has brought all the threads together: a bank that prints its own money, sells it for real tender and uses the proceeds to buy back the debt.

Hilary Powell and Dan Edelstyn have taken over an old Co-op Bank on a high street in Walthamstow and are printing money featuring the faces of people behind four local services – a primary school, a foodbank, a youth project and a soup kitchen. As well as raising money for those projects, Hoe Street Central Bank aims to raise enough money to buy out £1m of debt owned by people within the E17 postcode, in a London borough ranked 35th most deprived in the country.

“We see it as a community heist taking on the economic discourse,” says Powell. One of the delightful ironies of the undertaking is that the ‘bank’ could only have to raise as little as £20,000 to buy out £1m of local debt, because bad loans are often written down to a fraction of their face value in the secondary market. “The system forces people into debt for basic needs,” says Powell. “We are the forerunners of what we hope will be a bigger movement for debt abolition.” As the bank did its unusual trade this week, schoolchildren were invited in to watch a batch of £5, £10 and £20 notes, all designed by artists, roll off the presses. After all, it’s not every day that you see your headteacher’s face on a fiver.

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Varoufakis’ Shakespeare lecture. The recent Facebook and Novichok stories would fit right in.

Shaking the Superflux (Varoufakis)

As is, alas, well known, my country went bankrupt in 2010. And the oligarchies, Greek and European, in power decided to cover it up by means of largest loan in History to the most bankrupt European state – money that was, always, meant to flow on to France’s and Germany’s bankrupt bankers while the Greeks were thrown indefinitely into debtor’s prison and treated to the harshest austerity this planet has ever seen. Yes, there was method to the madness of the powers-that-be, just as in any Shakespearean play. Watching them stumble from one idiotic decision to the next, making things up as they were going along, and intensifying the crisis that they were trying to quell, was like watching a version of Othello, wondering how smart people could be so foolish, or of a Macbeth scheming in the land of Oedipus.

Like King Laius of Thebes unwittingly brought about his own murder by his son Oedipus because he believed the prophecy that Oedipus would kill him once he grew up, so too did Europe’s Deep Establishment, in a bid to save their bankers while safeguarding their legitimacy, undermined their legitimacy by committing successive, Macbeth-like, crimes against logic – so much so that, today, the so-called political centre traditionally in the service of the Establishment lays in ruins everywhere in Europe: Think France, Austria, Germany, recently Italy, where political monsters are rising up across Europe bringing to mind Brutus’ line in Julius Caesar about the hatchling of the serpent’s egg that must be “killed in the shell” before it emerges. Except that, instead of crushing the shell before the new serpents hatched, the Establishment kept it warm, facilitated its hatching, and is now repeatedly bitten by them.

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Global plastic production is increasing exponentially.

‘Great Pacific Garbage Patch’ 16 Times Larger Than Previously Estimated (G.)

An enormous area of rubbish floating in the Pacific Ocean is teeming with far more debris than previously thought, heightening alarm that the world’s oceans are being increasingly choked by trillions of pieces of plastic. The sprawling patch of detritus – spanning 1.6m sq km, (617,763 sq miles) more than twice the size of France – contains at least 79,000 tons of plastic, new research published in Nature has found. This mass of waste is up to 16 times larger than previous estimates and provides a sobering challenge to a team that will start an ambitious attempt to clean up the vast swath of the Pacific this summer.

The analysis, conducted by boat and air surveys taken over two years, found that pollution in the so-called Great Pacific garbage patch is almost exclusively plastic and is “increasing exponentially”. Microplastics, measuring less than 0.5cm (0.2in), make up the bulk of the estimated 1.8tn pieces floating in the garbage patch, which is kept in rough formation by a swirling ocean gyre. While tiny fragments of plastic are the most numerous, nearly half of the weight of rubbish is composed of discarded fishing nets. Other items spotted in the stew of plastic include bottles, plates, buoys, ropes and even a toilet seat.

“I’ve been doing this research for a while, but it was depressing to see,” said Laurent Lebreton, an oceanographer and lead author of the study. Lebreton works for the Ocean Cleanup, a Dutch-based non-profit that is aiming to tackle the garbage patch. [..] The organization is developing a system of large floating barriers with underwater screens that capture and concentrate plastics into one area ready to be scooped out of the ocean. A prototype, to be launched from San Francisco this summer with the aim of spawning a clutch of devices each of which can collect five tons of waste a month, will, if successful, be followed by dozens of other boom-like systems measuring up to 2km (1.2 miles) long.

The project comes with caveats, however – its system will not catch the proliferation of microplastics measuring under 10 millimeters (0.39in) and the whole operation will require further funding from next year. Any successful clean-up may also be overwhelmed by a global surge in plastic production – a recent UK government report warned the amount of plastic in the ocean could treble within the next decade. “There is a big mine of microplastics there coming from larger stuff that’s crumbling down, so we need to get in there quickly to clean it up,” said Joost Dubois, a spokesman for the Ocean Cleanup.

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The official report. Half of the garbage is fishing nets. A recent report estimated 70% of all visible plastic is discarded nets.

Great Pacific Garbage Patch Is Rapidly Accumulating Plastic (Nature)

Ocean plastic can persist in sea surface waters, eventually accumulating in remote areas of the world s oceans. Here we characterise and quantify a major ocean plastic accumulation zone formed in subtropical waters between California and Hawaii: The Great Pacific Garbage Patch (GPGP). Our model, calibrated with data from multi-vessel and aircraft surveys, predicted at least 79 (45-129) thousand tonnes of ocean plastic are floating inside an area of 1.6 million km2; a figure four to sixteen times higher than previously reported.

We explain this difference through the use of more robust methods to quantify larger debris. Over three-quarters of the GPGP mass was carried by debris larger than 5 cm and at least 46% was comprised of fishing nets. Microplastics accounted for 8% of the total mass but 94% of the estimated 1.8 (1.1-3.6) trillion pieces floating in the area. Plastic collected during our study has specific characteristics such as small surface-to-volume ratio, indicating that only certain types of debris have the capacity to persist and accumulate at the surface of the GPGP. Finally, our results suggest that ocean plastic pollution within the GPGP is increasing exponentially and at a faster rate than in surrounding waters.

Global annual plastic consumption has now reached over 320 million tonnes with more plastic produced in the last decade than ever before. A significant amount of the produced material serves an ephemeral purpose and is rapidly converted into waste. A small portion may be recycled or incinerated while the majority will either be discarded into landfill or littered into natural environments, including the world’s oceans. While the introduction of synthetic fibres in fishing and aquaculture gear represented an important technological advance specifically for its persistence in the marine environment, accidental and deliberate gear losses became a major source of ocean plastic pollution. Lost or discarded fishing nets known as ghostnets are of particular concern as they yield direct negative impacts on the economy and marine habitats worldwide.

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Ehrlich still claims it’s preventable. Why?

‘Collapse Of Civilisation Is A Near Certainty Within Decades’ – Ehrlich (G.)

A shattering collapse of civilisation is a “near certainty” in the next few decades due to humanity’s continuing destruction of the natural world that sustains all life on Earth, according to biologist Prof Paul Ehrlich. In May, it will be 50 years since the eminent biologist published his most famous and controversial book, the Population Bomb. But Ehrlich remains as outspoken as ever. The world’s optimum population is less than two billion people – 5.6 billion fewer than on the planet today, he argues, and there is an increasing toxification of the entire planet by synthetic chemicals that may be more dangerous to people and wildlife than climate change.

Ehrlich also says an unprecedented redistribution of wealth is needed to end the over-consumption of resources, but “the rich who now run the global system – that hold the annual ‘world destroyer’ meetings in Davos – are unlikely to let it happen”. The Population Bomb, written with his wife Anne Ehrlich in 1968, predicted “hundreds of millions of people are going to starve to death” in the 1970s – a fate that was avoided by the green revolution in intensive agriculture. Many details and timings of events were wrong, Paul Ehrlich acknowledges today, but he says the book was correct overall. “Population growth, along with over-consumption per capita, is driving civilisation over the edge: billions of people are now hungry or micronutrient malnourished, and climate disruption is killing people.”

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I doubt that “it’s not too late”.

Mammoth Survey Of Nature’s Vital Signs Released (AFP)

Scientists will deliver a comprehensive assessment Friday of the state of biodiversity — the animals and plants that humankind depends on to survive but has driven into a mass species extinction. The labor of some 600 scientists over three years, four reports will be unveiled in Medellin, Colombia, under the umbrella of the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES). The diagnosis is expected to be dire. “If we continue the way we are, yes the… sixth mass extinction, the first one ever caused by humans, will continue,” IPBES chairman Robert Watson told AFP ahead of the much-anticipated release. But the good news, he said, “It’s not too late” to slow the rate of loss.

Scientists say mankind’s voracious consumption and wanton destruction of Nature has unleashed the first mass species die-off since the demise of the dinosaurs – only the sixth on our planet in half-a-billion years. The first major biodiversity assessment in 13 years comes in the same week that Sudan, the world’s last male northern white rhino, died in Kenya – a stark reminder of the stakes. “The IPBES conference is going to tell us that the situation is continuing to deteriorate, they are going to tell us some ecosystems are being brought to the brink of collapse,” WWF director general Marco Lambertini told AFP on Thursday. “The IPBES is going to make a strong case for the importance of protecting Nature for our own wellbeing.”

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 March 11, 2018  Posted by at 10:06 am Finance Tagged with: , , , , , , , , , , , ,  


James McNeill Whistler Nocturne Blue and Gold Southampton Water 1872

 

$21 Trillion And Rising: Central Banks’ Leveraged Buyout of The World (ZH)
The $233 Trillion Dollar Dark Cloud of Global Debt (GT)
Trump Is Going For A Clean Reset in The West Wing (Vanity Fair)
Trump ‘Clarity’ on Tariff Conditions Not What EU Was Looking For (BBG)
China Ties Future to Xi as Congress Scraps President Term Limits (BBG)
Putin Says He ‘Couldn’t Care Less’ If Russians Meddled In 2016 Elections (NBC)
Millions Of Struggling UK Families Face Deepest Benefit Cuts In Years (O.)
UK Government Leaves At Least £1 Billion For Affordable Housing Unspent (O.)
‘We Are Nowhere Near Out Of Austerity’ – Institute for Fiscal Studies (G.)
UK Consumers Losing Interest In Buying New Cars On Credit (Ind.)
Erdogan Slams Allies’ Refusal To Support Turkey Offensive In Syria’s Afrin (RT)
Greek Defense Minister: We’re Close To A ‘Fatal Accident’ With Turkey (K.)
Post-Bailout Credit Line For Greece Probably Not Needed – Regling (R.)
UK Government Asks Public For Ideas To Curb Plastic Pollution (Ind.)

 

 

$21 trillion to buy out a broken system.

$21 Trillion And Rising: Central Banks’ Leveraged Buyout of The World (ZH)

Back in late 2016, we showed the unprecedented domination of capital markets by central banks using a chart from Citi, which had put together a fascinating slideshow asking simply “Where is the utility in marginal QE” and specifically pointing out that the longer unconventional monetary policy such as QE continues, the bigger its marginal cost, until eventually QE becomes a detriment. A broad criticism of monetary policy, the presentation carried an amusing footnote: “This presentation does not change any of Citi’s existing, published views on the actual future path of monetary policy. It is merely intended as a contribution to the ongoing debate about the efficacy of available policy tools” – after all, the last thing the market wanted is the realization that even banks no longer have faith in the central planners.

Incidentally, Citi’s broad critique of global QE took place when central banks owned just over $18 trillion in assets. Fast forward to today when in its latest update of central bank holdings, Citi shows that as of this moment not only has the total increased by another $3 trillion to a grand total of $21 trillion and rising, but that the big six central banks now own over 40% of global GDP, more than double the 17% they held before the financial crisis less than a decade ago. Which is remarkable in a world where there is still some confusion about what is behind the “global coordinated recovery”, and where there are deluded people who claim that central banks are now out of the picture.

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I admit: it was the headline. Nothing much else there.

The $233 Trillion Dollar Dark Cloud of Global Debt (GT)

Global debt has reached record heights without any signs of relief. While central bankers try to explain away the phenomenon of these out-of-control numbers, it’s not much of a mystery. Immediate consumption with the promise of repayment sometime in the future has consequences. Global debt is staggering to the point most of it will never be repaid. Certainly not in our generation. Perhaps by our grandchildren, but as global debt keeps mounting, the picture is doubtful. The per capita global debt is $30,000. Who, exactly, will be making repayments? Economists insist that the 2007 financial crisis could not have been predicted. Yet, all the signs of out-of-control credit where there.

Today, economists are repeating the same mantra, despite the spiraling world debt. The question is not if the next bubble will strike. It’s a matter of when. The math is fairly simple. The more a country increases its debt to simply stay afloat, the more like the increasing debt will cause a tightening of credit. The next step in the equation is a burst bubble and economic crisis. This is what happened in 1929, happened again in 2007, and it’s happening now. Past behavior is the best predictor of future behavior. Out-of-control credit will undoubtedly slow down the US’s current economic growth. It probably won’t cause an outright crisis. Other countries may not be as fortunate.

Countries such as China, Belgium, South Korea, Australia, and Canada are experiencing an unprecedented credit bubble, with few systems in place to control it. The resulted inflation or simply write-offs of debts could result in a global financial disaster we have not seen before. The current economic upswing is unlikely to continue.

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Coming out of the sophomore year. Cohn wanted to be Chief of Staff… Still, Bolton would be a grave mistake, he would be shredded.

Trump Is Going For A Clean Reset in The West Wing (Vanity Fair)

Even before he decided to launch a trade war and roll the nuclear dice by agreeing in the course of a West Wing afternoon to a risky sit-down with Kim Jong Un, Donald Trump was telling friends he was tired of being reined in. “I’m doing great, but I’m getting all these bad headlines,” Trump told a friend recently. A Republican in frequent contact with the White House told me Trump is “frustrated by all these people telling him what to do.” With the departures of Hope Hicks and Gary Cohn, the Trump presidency is entering a new phase—one in which Trump is feeling liberated to act on his impulses. “Trump is in command. He’s been in the job more than a year now. He knows how the levers of power work. He doesn’t give a fuck,” the Republican said.

Trump’s decision to circumvent the policy process and impose tariffs on imported steel and aluminum reflects his emboldened desire to follow his impulses and defy his advisers. “It was like a fuck-you to Kelly,” a Trump friend said. “Trump is red-hot about Kelly trying to control him.” According to five Republicans close to the White House, Trump has diagnosed the problem as having the wrong team around him and is looking to replace his senior staff in the coming weeks. “Trump is going for a clean reset, but he needs to do it in a way that’s systemic so it doesn’t look like it’s chaos,” one Republican said. Sources said that the first officials to go will be Chief of Staff John Kelly and National Security Adviser H.R. McMaster, both of whom Trump has clashed with for months.

On Tuesday, Trump met with John Bolton in the Oval Office. When he plans to visit Mar-a-Lago next weekend, Trump is expected to interview more candidates for both positions, according to two sources. “He’s going for a clean slate,” one source said. Cohn had been lobbying to replace Kelly as chief, two sources said, and quit when he didn’t get the job. “Trump laughed at Gary when he brought it up,” one outside adviser to the White House said. Next on the departure list are Jared Kushner and Ivanka Trump. Trump remains fiercely loyal to his family, but various distractions have eroded their efficacy within the administration. Both have been sidelined without top-secret security clearances by Kelly, and sources expect them to be leaving at some point in the near future.

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But he’s clear.

Trump ‘Clarity’ on Tariff Conditions Not What EU Was Looking For (BBG)

Hours after European Union trade chief Cecilia Malmstrom said she had “no immediate clarity” on whether the bloc will be let off the hook from planned U.S. tariffs, President Donald Trump laid down his conditions and repeated a threat if they’re not met. “The European Union, wonderful countries who treat the U.S. very badly on trade, are complaining about the tariffs on Steel & Aluminum,” he wrote on Twitter. “If they drop their horrific barriers & tariffs on U.S. products going in, we will likewise drop ours. Big Deficit. If not, we Tax Cars etc. FAIR!” Trump’s response came after Malmstrom on Twitter described what she called “frank” but fruitless talks with U.S. Trade Representative Robert Lighthizer in Brussels on Saturday.

There was still “no immediate clarity on the exact U.S. procedure on exemption,” Malmstrom, the 28-nation bloc’s trade commissioner, said after the meeting that also included Japanese Trade Minister Hiroshige Seko. “As a close security and trade partner of the U.S. the EU must be excluded from the announced measures,” she said. Canada, Mexico and Australia have secured exemptions from the tariffs of 25% on imported steel and 10% on aluminum announced by Trump, though Canada’s and Mexico’s were conditioned on progress renegotiating NAFTA. Trump has called the tariffs a matter of national security while threatening to tax European car imports and impose “reciprocal taxes” on countries that charge higher duties on U.S. goods than the U.S. now charges on their products.

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Just as China’s economic model is about to ‘go into a next phase..’

China Ties Future to Xi as Congress Scraps President Term Limits (BBG)

China’s parliament voted to repeal presidential term limits, allowing President Xi Jinping to retain power indefinitely in a formal break from succession rules set up after Mao Zedong’s turbulent rule. The rubber-stamp National People’s Congress agreed Sunday to strike a 36-year-old constitutional provision barring the president from serving more than two consecutive terms. The amendment – announced by the Communist Party two weeks ago – removes the only barrier keeping Xi, 64, from staying on after his expected second term ends in 2023. The vote – never in doubt – gives Xi more time to enact plans to centralize party control, increase global clout and curb financial and environmental risks.

It also ties the world’s most populous country more closely to the fate of a single man than at any point since reformer Deng Xiaoping began establishing a system for peaceful power transitions in the aftermath of Mao’s death. Before Sunday’s vote in Beijing, Donald Trump had joked that Xi was “now president for life.” The NPC could appoint Xi to a second term as soon as Saturday. “In the long run, the change may bring some uncertainties, like ‘key man’ risk,” Yanmei Xie, a China policy analyst for Gavekel Dragonomics in Beijing, said before the vote. “Dissenting is becoming riskier. The room for debate is becoming narrower. The risk of a policy mistake could become higher and correcting a flawed policy could take longer.”

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They all reported on the Megyn Kelly interview a while ago. Now all of a sudden there’s a new headline from that same interview. And.. “he even said it might be Jews..”

Putin Says He ‘Couldn’t Care Less’ If Russians Meddled In 2016 Elections (NBC)

Russian President Vladimir Putin has told NBC News that he “couldn’t care less” if Russian citizens tried to interfere in the 2016 American presidential election because, he claims, they were not connected to the Kremlin. In an exclusive and at-times combative interview with NBC’s Megyn Kelly, Putin again denied the charge by U.S. intelligence services that he ordered meddling in the November 2016 vote that put Donald Trump in the White House. “Why have you decided the Russian authorities, myself included, gave anybody permission to do this?” asked Putin, who will probably be returned as president in the March 18 elections.

Putin was unmoved by an indictment filed by special counsel Robert Mueller last month that accused 13 Russian nationals and three Russian companies of interfering in the election – including supporting Trump’s campaign and “disparaging” Hillary Clinton’s. Mueller is investigating whether the Trump campaign colluded with the Kremlin. “So what if they’re Russians?” Putin said of the people named in last month’s indictment. “There are 146 million Russians. So what? … I don’t care. I couldn’t care less. … They do not represent the interests of the Russian state.” Putin even suggested that Jews or other ethnic groups had been involved in the meddling.

“Maybe they’re not even Russians,” he said. “Maybe they’re Ukrainians, Tatars, Jews, just with Russian citizenship. Even that needs to be checked. Maybe they have dual citizenship. Or maybe a green card. Maybe it was the Americans who paid them for this work. How do you know? I don’t know.” Asked whether he was concerned about Russian citizens attacking U.S. democracy, Putin replied that he had yet to see any evidence that the alleged interference had broken Russian law. “Are we the ones who imposed sanctions on the United States? The U.S. imposed sanctions on us.” “We in Russia cannot prosecute anyone as long as they have not violated Russian law,” he said. “At least send us a piece of paper. … Give us a document. Give us an official request. And we’ll take a look at it.”

U.S. intelligence agencies and many Western analysts have said that Russian interference came at the orders of the Kremlin. Putin, Russia’s longest-serving leader since Stalin, dismissed this. “Could anyone really believe that Russia, thousands of miles away … influenced the outcome of the election? Doesn’t that sound ridiculous even to you?” he said. “It’s not our goal to interfere. We do not see what goal we would accomplish by interfering. There’s no goal.”

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In praise of austerity, of destroying the social and health care systems. A class society, more suited to the 19th than the 21st century.

Millions Of Struggling UK Families Face Deepest Benefit Cuts In Years (O.)

Families struggling to make ends meet will be hit by the biggest annual benefits cut for six years, according to a new analysis that exposes the impact of continuing austerity measures on the low paid. Chancellor Philip Hammond is preparing to give a stripped-down spring statement on Tuesday, where he is expected to boast of lower than expected borrowing figures. He will use them to suggest Britain has reached a “turning point”. He will point to forecasts showing the “first sustained fall in debt for a generation” to claim “there is light at the end of the tunnel” in turning around Britain’s finances. However, he will be speaking just weeks before a further public spending squeeze will see the second largest annual cut to the benefits budget since the financial crash.

According to new research by the Resolution Foundation thinktank, the changes from April will save around £2.5bn and dent the incomes of the “just about managing” families that Theresa May has vowed to help. The cuts will affect around 11 million families, including 5 million of the struggling families that the prime minister stated she would focus on. There will also be some good news for the low paid, with more than 1.5 million workers set to benefit from a 4.4% pay rise when the national living wage increases from £7.50 to £7.83 at the start of April. However, that measure will be outweighed by the effective £2.5bn cuts to working-age benefits.

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The real face of the British government.

UK Government Leaves At Least £1 Billion For Affordable Housing Unspent (O.)

MPs are demanding an urgent explanation from ministers after being told that £817m allocated for desperately needed affordable housing and other projects in cash-strapped local authorities has been returned to the Treasury unspent. The surrender of the unused cash has astonished members of the cross-party housing, communities and local government select committee at a time when Theresa May has insisted housebuilding is a top priority and when many local authorities are becoming mired in ever deeper financial crises. On Monday the committee, which discovered the underspend for 2017-18, will interrogate housing minister Dominic Raab and homelessness minister Heather Wheeler on the issue, before Tuesday’s spring statement by the chancellor, Philip Hammond.

He is under heavy pressure from MPs, and the Tory-controlled Local Government Association, to signal extra help for the local authority sector, which has seen budget cuts of around 50% since 2010. The acting chair of the committee, the Tory MP Bob Blackman, said: “We will be wanting to know why this very large sum has not been spent at a time of great strain on local authority budgets, and why it was not channelled to other spending projects. It does not help those of us who argue that more should be given to local authorities if the chancellor knows money he gave last time has not even been spent.” MPs believe they can argue for more for local authorities because Hammond will announce that unexpectedly high tax receipts have left the Treasury with a windfall of between £7bn and £10bn.

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Never trust anything that sounds even remotely like “Institute for Fiscal Studies”. This wanker goes on to praise the achievements of Britain’s austerity.

‘We Are Nowhere Near Out Of Austerity’ – Institute for Fiscal Studies (G.)

When the chancellor Philip Hammond sits down on Tuesday after delivering his first spring statement – the streamlined replacement for what we used to call the budget – one man will be greatly in demand, popping up on every media outlet to tell us what the figures on borrowing levels and the projected deficit really mean. That man is Paul Johnson, director of the Institute for Fiscal Studies (IFS). I suggest to him that his official role is to pour a bucket of cold water over Hammond’s head, and he doesn’t disagree. [..] The idea of the spring statement, with the budget now pushed back to autumn, is to tell us where we are financially, and to kickstart consultations about the long-term fiscal challenges facing the UK. That, for Johnson, is the important bit.

If the spring statement works, it is an opportunity to counteract the short-termism that bedevils British politics and to start thinking about the issues that really matter – the ageing population, the buckling health service, the lack of any coherent plan for social care, the fact that soon taxes are going to have to rise or public services will fall to pieces. There comes a point when you can no longer kick the can down the road because the road is no longer usable. The Office for Budget Responsibility numbers cited in the spring statement will be better than those projected last autumn because tax receipts have been higher than anticipated, and Johnson reckons Hammond will indulge in some self-congratulation for having met the government’s austerity targets (albeit two years later than his predecessor George Osborne forecast) and eliminated the deficit on day-to-day spending.

But Johnson is ready with his bucket of cold water. “Chancellors always talk up the positive numbers,” he says, “but we’re not out of austerity; we’re nowhere near out of austerity. There are still big spending cuts and big social security cuts to come.” [..] He says the government has done well to get the deficit under control [..] Local government until 2014 was coping fine. It really isn’t any more. Clearly, the health service is struggling in a way that, three or four years ago, it wasn’t. So it feels as if we’ve got to the crunch point. We’re really beginning to feel the cost.” Government borrowing is now back to pre-financial crash levels. “It is quite an achievement to have got borrowing down from the highest level since the war to pretty much normal kinds of levels,” he says.

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Followed by a car sales promo. No. 1 advertizers for newspapers.

UK Consumers Losing Interest In Buying New Cars On Credit (Ind.)

The march of the brand new car once seemed unstoppable. Cheap finance and personal contract plans (PCPs) fuelled a boom in new cars, accounting for more than 80% of all new car registrations. A fall at the start of 2017 was blamed on a collapse in consumer confidence in diesel vehicles and last year remains one of the highest on record for new car registrations. However, the latest figures reveal that the number of new cars registered in February fell by 2.8% compared with the same month last year, making it the 11th month in a row to show a decline. And once again it’s being blamed on falling demand for diesel vehicles; diesel cars accounted for just 35% of the new cars registered last month, compared with more than 44% in February 2017.

[..] The previous surge in new car registrations had been partly fuelled by changes to the way we buy vehicles. Buying a brand new car with a relatively small deposit and monthly fee can be more immediately affordable than buying an older car upfront. 37% of car buyers claim to have bought on finance because it enabled them to spread out their payment monthly, 36% to get a better deal and, revealingly, 36% because they couldn’t afford to purchase a car otherwise. [..] Justin Benson, KPMG’s UK head of automotive, says: “Consumers aren’t necessarily turning away from car finance. There is, however, evidence to suggest that the new car market is pretty saturated, ie most cars in the last few years have been bought using PCP plans. So many are using the vehicles they already have and we are seeing a drop in demand – although Brexit is also in the back of people’s minds.”

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Hollow phrases: “Washington has repeatedly called upon Turkey to stop its “aggression” against the Afrin region..”

Erdogan Slams Allies’ Refusal To Support Turkey Offensive In Syria’s Afrin (RT)

Turkey’s leader has scorched NATO allies over their failure to support his “counter-terrorist” operation in the Kurdish-held Syrian region of Afrin, but expressed gratitude that they at least had no guts to openly oppose Ankara. President Recep Tayyip Erdogan delivered the inflammatory comments while speaking before a gathering of his ruling AK Party in the Turkish city of Mersin on Saturday. “Hey NATO where are you? We’re fighting so much. NATO, Turkey is not a NATO country? Where are you? You’ve invited NATO-member states to Afghanistan,” Erdogan said. NATO members not only show no support towards Turkey’s Operation Olive Branch and would even openly oppose Ankara’s actions in Syria, but did not have the guts to do so, Erdogan claimed.

The offensive against Kurdish militias in Syria’s region of Afrin was launched late in January. Turkey describes the militias as offshoots of the terrorist-labeled outlawed Kurdistan Workers’ Party (PKK). So far, 3,213 “terrorists” have been killed during the operation, carried out by Turkish troops and affiliated Free Syrian Army (FSA) militants, Erdogan stated. “In fact, they would openly oppose Turkey in Syria if they could. But seeing Turkey’s adamant position, they did not find [the] resolve to do so,” the president said. The Turkish leader also reiterated his earlier statements, that his only goal in Syria was the “fight against terrorism.” When Ankara reaches it, the troops will be pulled out of the country, he stated.

[..] Washington has repeatedly called upon Turkey to stop its “aggression” against the Afrin region, omitting the fact that the US-led coalition itself spent years in Syria without any invitation from the government or international approval. The recent UNSC resolution, which urged a 30-days Syria-wide ceasefire, has been also used to call upon Erdogan to halt the invasion. “Turkey is more than welcome to go back and read the exact text of this UN Security Council resolution, and I would suggest that they do so,” US State Department spokeswoman Heather Nauert said on February 27, stating that the Afrin region was “certainly within Syria.”

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Don’t say you weren’t warned.

Greek Defense Minister: We’re Close To A ‘Fatal Accident’ With Turkey (K.)

As tensions rise over the detention of two Greek soldiers who crossed the Turkish border accidentally and over Turkish aggression off Cyprus, statements by both Greek and Turkish officials over the weekend underscored the fragility of the situation. In an interview with French daily Liberation on Saturday, Greek Defense Minister Panos Kammenos declared that “Greece is very close to a fatal accident with Turkey,” referring to Turkish violations of Greek air space and territorial waters. “We are obliged to defend our territory which is not only Greek but also European,” he said. Late last week, meanwhile, Kammenos had referred to two Greek soldiers being detained in Turkey as “hostages.”

Meanwhile, in an interview with German weekly Die Zeit published on Saturday, Turkish Foreign Minister Mevlut Cavusogu said Turkey’s judiciary was seeking to determine whether the Greek soldiers crossed into Turkey by accident or deliberately. Asked whether Ankara was considering exchanging the two men with eight Turkish servicemen who fled to Greece following an attempted Turkish coup in 2016, Cavusoglu ruled out such a prospect. “We do not want such an agreement,” he said.

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Oh yes, it will. Brussles won’t set its slaves free voluntarily.

Post-Bailout Credit Line For Greece Probably Not Needed – Regling (R.)

Greece will probably not need a precautionary credit line after its bailout ends in August if the country sticks to reforms, the head of Europe’s rescue fund said in an interview released on Saturday. Greece has received 260 billion euros in financial aid from euro zone countries and the IMF since 2010, and its third bailout expires in August. The country regained market access last year but some European Union policymakers and Greek central bankers believe Athens cannot go it alone without a standby line of credit after its financial support ends. But a precautionary credit line would come with conditions attached, something the government is keen to avoid after eight years of austerity that has worn down Greeks and hurt its popularity in polls.

In an interview with Proto Thema newspaper, the head of the European Stability Mechanism (ESM), Klaus Regling, said having a precautionary arrangement available is good because it gives more assurances to markets, investors and the Greek population. “But it very much depends whether it’s really needed,” he said. “If everything remains quiet, reforms continue and Greece continues to develop its market access, then based on what we know today it’s probably not needed.” The ESM and the European Financial Stability Facility are Greece’s largest creditors, together holding more than half of its 332 billion euro public debt, a sum equal to nearly 180% of economic output.

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They talk the talk because their pollsters say they must. And then deflect responsibility because they have no intention of doing anything. This way it becomes along term issue; the public must be heard first, and that takes years.

A tax on disposable cups is ridiculous. Just ban them, what’s the problem?

UK Government Asks Public For Ideas To Curb Plastic Pollution (Ind.)

The public will be urged by the Government to suggest tax changes to curb plastic pollution, amid growing criticism that ministers are dragging their heels. A “call for evidence” on how tax incentives could cut the amount of single-use plastics – such as cutlery, foam trays and coffee cups – that end up littering the land and poisoning the seas will be launched. But the move, in Tuesday’s Spring Statement, is not expected to include any specific proposals, nor will a formal consultation be launched by the Treasury. Philip Hammond, the Chancellor, will tell MPs he is determined that Britain will “lead the world in creating innovative solutions to tackling this global problem”.

But the call for evidence was first proposed by Mr Hammond four months ago, the delay prompting criticism that ministers have simply “talked the talk on plastic pollution”. A proposal for a 25p “latte levy” on disposable coffee cups, made by a cross-party Commons committee in January was met with a cool response from the Government. In January, Theresa May delivered the first major speech on the environment from a sitting prime minister since 2004 and published a 25-year Environment Plan with the ambition of abolishing plastic waste by 2042. However, it was widely criticised for being vague, for the lack of proposed legislation and for the lengthy timescales for dealing with the problems involved. [..] The UK still creates 2.26 million tons of plastic packaging waste a year and recycles only around a third.

On Tuesday, Mr Hammond will say the call for evidence is intended to find ways to use the tax system to deliver both technological progress and behavioural change. Individuals, green groups and industry will be urged to have their say, as the Chancellor announces a £20m innovation fund for businesses and universities to develop the new technologies and approaches needed. The Chancellor said: “Single-use plastics waste is a scourge to our environment. From crisp packets to coffee cups, each year the UK produces millions of tonnes of waste which is neither recyclable nor biodegradable. “That’s why I want British businesses and universities to lead the world in creating innovative solutions to tackling this global problem.

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Mar 092018
 
 March 9, 2018  Posted by at 10:29 am Finance Tagged with: , , , , , , , , , , , , , ,  


Broadway, New York 1954

 

Trump’s Historic Bet on Kim Summit Shatters Decades of Orthodoxy (BBG)
Trump Sets Steel And Aluminum Tariffs; Canada, Mexico Exempted (R.)
There Will Be No Economic Boom – Part II (Roberts)
“Gary Cohn, We Hardly Knew Ya” (David Stockman)
The Risk Lurking In The US Mortgage Market (CNN)
The End of Cheap Debt Will Bring a Wave of – Green- Bankruptcies (Mises)
Tesla Chief Musk Says China Trade Rules Uneven, Asks Trump For Help (R.)
China Will Rely Less On Stimulus As It Battles Risks From Debt – PBOC (CNBC)
UK Retirement Bill Rises More Than £1 Trillion In Five Years (Ind.)
Shares, Profits Of Britain’s Largest Estate Agent Countrywide Plummet (G.)
Toronto Home Builders Just Had Their Busiest February Since 1948 (BBG)
EU Freezes Brexit Talks Until Britain Produces Irish Border Solution (Ind.)
Calais ‘To Be 10 Times Worse Than Irish Border’ After Brexit (G.)
Bitcoin Tumbles Further In Broad Selloff For Cryptocurrencies (MW)
US Is Experiencing The Highest Drug Overdose Death Rates Ever (ZH)
Chinese Panda Conservation Park To Be Twice The Size Of Yosemite (G.)
Discarded Fishing Gear Massacres Whales, Dolphins, Seals, Turtles, Birds (Ind.)

 

 

Question is whether that is a bad thing. Or you could say: Trump brings along his own orthodoxy.

Trump’s Historic Bet on Kim Summit Shatters Decades of Orthodoxy (BBG)

Donald Trump took the biggest gamble of his presidency on Thursday, breaking decades of U.S. diplomatic orthodoxy by accepting an invitation to meet with North Korean leader Kim Jong Un. The bet is that Trump’s campaign to apply maximum economic pressure on Kim’s regime has forced him to consider what was previously unthinkable: surrendering the illicit nuclear weapons program begun by his father. If the president is right, the U.S. would avert what appeared at times last year to be a steady march toward a second Korean War. It was classic Trump, showing an unerring confidence to get the better end of any negotiation.

But it was also Trump in another way: high risk and high reward, with little regard for those in the foreign policy establishment who worry it’s too much, too soon. “He’s taking a risk,” said Patrick Cronin, senior director of the Asia-Pacific Security Program at the Center for a New American Security. “By seizing an opportunity for a summit meeting, a decision that would have taken much more time in another administration, the president has said, ‘I’m going to go right now. And we’re going to test this.”’

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“If you don’t want to pay tax, bring your plant to the USA..”

Trump Sets Steel And Aluminum Tariffs; Canada, Mexico Exempted (R.)

U.S. President Donald Trump pressed ahead on Thursday with import tariffs of 25% on steel and 10% for aluminum but exempted Canada and Mexico and offered the possibility of excluding other allies, backtracking from an earlier “no-exceptions” stance. Describing the dumping of steel and aluminum in the U.S. market as “an assault on our country,” Trump said in a White House announcement that the best outcome would for companies to move their mills and smelters to the United States. He insisted that domestic metals production was vital to national security. “If you don’t want to pay tax, bring your plant to the USA,” added Trump, flanked by steel and aluminum workers.

Plans for the tariffs, set to start in 15 days, have stirred opposition from business leaders and prominent members of Trump’s own Republican Party, who fear the duties could spark retaliation from other countries and hurt the U.S. economy. Within minutes of the announcement, U.S. Republican Senator Jeff Flake, a Trump critic, said he would introduce a bill to nullify the tariffs. But that would likely require Congress to muster an extremely difficult two-thirds majority to override a Trump veto. Some Democrats praised the move, including Senator Joe Manchin of West Virginia, who said it was “past time to defend our interests, our security and our workers in the global economy and that is exactly what the president is proposing with these tariffs.”

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Perhaps somewhat surprising: The consumer spending part of GDP only rises.

There Will Be No Economic Boom – Part II (Roberts)

When the “tax cut” bill was being passed, everyone from Congress to the mainstream media, and even the CFP’s I spoke with yesterday, regurgitated the same “storyline:” “Tax cuts will lead to an economic boom as corporations increase wages, hire and produce more and consumers have extra money in their pockets to spend.” As I have written many times previously, this was always more “hope” than “reality.” The economy, as we currently calculate it, is roughly 70% driven by what you and I consume or “personal consumption expenditures (PCE).” The chart below shows the history of real, inflation-adjusted, PCE as a percent of real GDP.

If “tax cuts” are going to substantially increase the growth rate of the U.S. economy, as touted by the current Administration, then PCE has to be directly targeted. However, while the majority of consumers will receive an “average” of $1182 in the form of a tax reduction, (or $98.50 a month), the increase in take-home pay has already been offset by surging health care cost, rent, energy and higher debt service payments. [..] But this is nothing new as corporations have failed to “share the wealth” for the last couple of decades.

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Those crazy earnings numbers WILL come crashing down.

“Gary Cohn, We Hardly Knew Ya” (David Stockman)

That was quick. The trade war scare was over by noon yesterday, and by the market close they were singing “Gary Cohn, we hardly knew ya”. Folks, what more evidence do you need that the financial markets are completely uncoupled from reality and that these feeble bounces between the 50-day and 20-day chart points are essentially the rigor mortis of a dead bull? At the moment, the 50-day stands at 2740 on the S&P 500 and is functioning as “resistance” according to the chart mavens, while the 20-day at 2700 is purportedly acting as “support”. So there’s that, but also this: At the exact mid-point of 2720, the broad market is currently trading at 25.6X reported earnings for 2017.

That’s the nosebleed section of history no matter how you slice it – and most especially in the context of an earnings growth trend that is shackled to the flat line, and which has no prospect of breaking away before the next recession, either. With virtually every company having reported, it turns out that GAAP earnings for 2017 came in at $109.46 per share on the S&P 500. Then again, 40 months earlier in September 2014 reported LTM earnings were $105.96 per share. That tabulates to a 1.0% per year gain during what will surely prove to have been the sweet spot (month #63 to month #102) of the current long-in-the-tooth business expansion.

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Non-banks. How is that different from China?

The Risk Lurking In The US Mortgage Market (CNN)

Low interest rates. Easy credit. Poor regulation. Toxic mortgages. These were just a few reasons regulators gave for the collapse of the US housing market a decade ago. Since then, regulators have improved the standards that lenders use when Americans apply for mortgages. But today increasing danger lurks in the mortgage market, and economists say it could put the financial system at “even greater risk” when the next recession strikes or too many borrowers fall behind on their mortgage payments. A growing segment of the mortgage market is being financed by so-called non-bank lenders — financial institutions that offer loans to consumers but don’t provide saving or checking accounts.

Borrowers with poor credit have increasingly turned to these alternative lenders instead of traditional banks. The alternative lenders are subject to far less regulation and have fewer safeguards when borrower defaults start to pile up. “A collapse of the non-bank mortgage sector has the potential to result in substantial costs and harm to consumers and the US government,” economists at the Federal Reserve and the University of California, Berkeley, write in a paper released Thursday at a Brookings Institution conference. As of 2016, non-bank financial institutions originated close to half of all mortgages. They originated three-quarters of mortgages with explicit government backing, underscoring the risk to taxpayers.

“The experience of the financial crisis suggests that the government will be pressured to backstop the sector in a time of stress,” the authors write. The danger is that non-banks may have fewer resources to weather economic shocks to the mortgage market, like a rise in interest rates or a decline in house prices. “What happens if interest rates rise and non-bank revenue drops? What happens if commercial banks or other financial institutions lose their taste for extending credit to non-banks? What happens if delinquency rates rise and servicers have to advance payments to investors?” the authors write. “We cannot provide reassuring answers to any of these questions,” they write.

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The entire Green Facade depends on cheap credit. And subsidies.

The End of Cheap Debt Will Bring a Wave of – Green- Bankruptcies (Mises)

The end of the era of cheap money highlights the risk of “Enron-style” bankruptcies in many sectors, including renewable energy. With the path of three rate hikes in the United States in 2018 confirmed by the Federal Reserve and a nervous equity market, the challenges are more evident than ever. The past eight years of massive liquidity and low rates have not helped deleverage, and many companies have used this period to increase imbalances and create complex debt structures. In fact: • Corporate net debt to EBITDA levels is at record highs. About 20% of US corporates face default if rates rise, according to the IMF. • The number of zombie companies has risen above pre-crisis levels according to the Bank of International Settlements (BIS). • This is particularly evident in the renewable sector where, even in the years of high liquidity and low rates, bankruptcies soared.

The renewable sector has undergone an absolutely spectacular transformation in the past eight years. Technology advanced, costs fell and global leaders strengthened when their strategy was to develop an energy model. Understanding that disruptive technologies cannot be more leveraged than traditional ones was key. When technology reduces costs and disrupts inflationary models, basing the business on ever-increasing subsidies and higher prices and financing it with massive debt is suicidal. In the era of cheap money and extreme liquidity, many companies used the “green” subterfuge to implement an extremely leveraged builder-developer model, ignoring demand, costs, and competition. A model whose sole objective was to install for the sake of installing capacity, whether there was a demand or not, and that pursued subsidies while stating that it is very competitive.

Even in a period of falling interest rates and very high liquidity, there have been spectacular bankruptcies, so imagine what can happen when rates rise. [..] If a technology is viable, it does not need subsidies. If it is unviable, no subsidies will change it. Bankruptcies in the solar sector exceed all those of the inefficient coal and fracking companies combined. This domino of bankruptcies, which includes more than 120 corpses of large companies around the world, was self-inflicted. And now, winter is coming. [..] The global renewable sector faces refinancing needs in the next seven to eight years that exceed its entire market capitalization (134 billion euros, Renixx Index).

It is not a problem of technology, it is the addiction to cheap debt and growth for growth sake. And it’s not just a problem in the renewable sector. The combination of lower revenues and increased debt costs is a danger. Cost of debt rises, and cost of equity soars due to higher perceived risk, which in turn can dry up the market for capital increases and refinancing. It is not just renewables, but it is worth highlighting that energy is -again- the most vulnerable sector due to the cyclical nature of its revenues and the perpetuation of overcapacity of the past eight years.

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Musk is the leader of the Green Facade.

Tesla Chief Musk Says China Trade Rules Uneven, Asks Trump For Help (R.)

Tesla CEO Elon Musk took to Twitter on Thursday to call on U.S. President Donald Trump to challenge China’s auto trade rules, which limit foreign ownership of Chinese ventures and impose steep tariffs on imported cars. In a series of tweets aimed at the president, Musk said he was “against import duties in general, but the current rules make things very difficult. It’s like competing in an Olympic race wearing lead shoes.” Tesla has been pushing hard to build cars in China, the world’s largest auto market, but has hit roadblocks in negotiations with local authorities, in part because Musk is keen to keep full control of any local venture. “No U.S. auto company is allowed to own even 50% of their own factory in China, but there are five 100% China-owned EV (electric vehicle) auto companies in the U.S.,” Musk wrote in another tweet.

Tesla “raised this with the prior administration and nothing happened. Just want a fair outcome, ideally where tariffs/rules are equally moderate. Nothing more. Hope this does not seem unreasonable,” he said. Trump quoted one of Musk’s tweets in his announcement on new tariffs and said American automakers have not been treated fairly by trade rules around the world. Trump announced steep tariffs on steel and aluminum imports on Thursday. Politicians “have known it for years and never did anything about it. It’s got to change,” Trump said, saying he plans to impose a “reciprocal tax” on other countries. “We’re changing things,” Trump added. “We just want fairness.”

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Yeah, we all believe that.

China Will Rely Less On Stimulus As It Battles Risks From Debt – PBOC (CNBC)

China has moved away from its old growth model which was heavily reliant on investment and will rely less on stimulus to boost the economy in future, People’s Bank of China governor Zhou Xiaochuan said on Friday. Zhou’s comments echoed those of other top officials at China’s parliament this week which suggested that Beijing will be more cautious about spending this year while it focuses on reducing the risks from a rapid build-up in debt. After years of heavy pump-priming, markets worry less generous stimulus could retard the pace of growth not only in China but globally. But analysts believe Beijing will continue to keep the system well supplied with cash to avoid the risk of a sharp slowdown in economic growth, even as they continue to tighten the screws on financial regulations.

“We now emphasize the new normal of the economy, shifting from the past growth model of quantitative growth… referring to the accumulation of capital and investment to boost economic growth,” Zhou told reporters on the sidelines of the annual parliament session. “While pursuing higher quality growth, we will have to reduce our reliance on the old growth model of investment,” said Zhou, in what was likely his last news briefing before his expected retirement this month. Zhou said China needs to improve its regulatory supervision as soon as possible to curb risks to the financial system. He said China has begun to make progress in reducing such risks, but numerous threats remain, such as a lack of transparency at financial holding companies and digital currencies.

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The Brexit fiasco continues to expose the hidden weaknesses. Which in the case of pensions are global, but mostly remain hidden.

UK Retirement Bill Rises More Than £1 Trillion In Five Years (Ind.)

The UK’s pension funding crisis reached a new crisis milestone this week as the Office for National Statistics revealed the UK’s pension funding liabilities rose to £7.6 trillion at the end of 2015. The figure – the total amount promised to pay Brits’ future retirement income – includes £5.3 trillion of pension entitlements that were the responsibility of central and local government, most of which – around £4 trillion – came from State Pension entitlements. The remaining £2.3 trillion were private sector employee pension entitlements with £2 trillion due to final salary pensions, up from £1.4 trillion in 2010. As things stand, expert commentators suggest there is only around a third of that ‘in the bank’ in company pension funds.

The remainder, it is hoped, will be generated by future working populations. The figures are designed to provide a snapshot of household retirement entitlements, though they don’t include self-invested personal pensions, which have grown significantly in recent years thanks to legislative changes known as pensions freedoms. “While these are obviously large amounts of money, it is important to remember that the payments will be drawn over many years,” says Darren Morgan, head of national accounts for the ONS. “The figures say nothing about the sustainability of our pension system in future.”

In fact, pensions experts have been shocked by the statistics, which come just days after official warnings from the Government Actuary that National Insurance may have to increase by 5% to pay for future state pay outs. “The figures published by the ONS today are astonishing and bring into sharp relief the reasons behind proposed increases in the state pension age,” adds Tom Selby, senior analyst at AJ Bell. “Unfunded state pension entitlements are worth more than double UK GDP – these are promises that will, ultimately, have to be paid for by future generations either through higher taxes, a lower state pension income or a later retirement age.

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Why not say it like it is?

Shares, Profits Of Britain’s Largest Estate Agent Countrywide Plummet (G.)

Countrywide, Britain’s largest estate agent, has reported a 22.5% fall in core annual earnings and scrapped its dividend, sending its shares to record lows. It pledged to go “back to basics” to return its sales and lettings business to profitable growth after what it described as a disappointing year. “We have got to put our resources back in the front line and not at the head office,” said the executive chairman, Peter Long, adding that restructuring would reduce headcount to 350 from 400. Countrywide said its 2018 property pipeline was “significantly lower” and that it expected a fall of about 36% (£10m) in first-half adjusted earnings before interest, taxation and amortisation (Ebitda).

Its 2017 adjusted Ebitda fell 22.5% to £64.7m while group income fell almost 9% to £671.9m. Shares in Countrywide plunged to a record low of 66.64p before rising to 77p in mid-morning trading, down 13.4% . “The next few months will be messy as new plans are put into place,” Jefferies analysts said in a note to clients. “However, banks are lending their support to the new plan and we believe those equity investors who choose to do the same will have their patience rewarded.”

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As sales are down 35%.

Greater Toronto Home Sales Down 35% From February 2017

Toronto Home Builders Just Had Their Busiest February Since 1948 (BBG)

Toronto developers had one of their busiest months on record in February in another sign the condo market is alive and well in Canada’s biggest real estate market, even amid a broader slowdown. Builders began work on 5,677 units during the month, most of them multiple-unit projects like condos, the Canada Mortgage and Housing Corp. said Thursday in Ottawa. That’s the strongest February, and the sixth-highest figure for any month, in records back to 1948. The bulk of Toronto condo units are typically sold before construction begins, so the latest surge may simply reflect past sales. But the report also suggests developers are betting the condo market will be less affected by headwinds including higher borrowing costs and tighter mortgage qualification rules that are currently hitting Toronto housing.

“It’s probably lagging a little bit. Historically you tend to see supply follow demand,” said Robert Kavcic, an economist at Bank of Montreal. “The other nuance here is that a lot of the policy changes we’ve seen over the last year, they really had a bigger impact on the higher end of the single detached housing market.” [..] Construction is picking up in Toronto just as sales begin to slide, after various levels of government and regulators took measures to curb surging prices. Most recently, tougher mortgage guidelines came into play on Jan. 1, making it harder for prospective buyers to qualify for loans. Many buyers rushed into the market in December to get ahead of the rules.

Transactions fell 35% in February from a year earlier to 5,175 units, according to data released Tuesday by the Toronto Real Estate Board. It was the weakest February for sales since 2009. Prices are holding up better, particularly in the condo segment, which has gained consistently over the past year and is up 20% since last February. Prices for single-detached homes have fallen 12% since reaching a record last year. Fundamentals that favor condos seem to be at work, as rising immigration levels drive demand. And since the net effect of the new regulations is to limit the size of mortgage credit, the tougher rules may be buoying the less-expensive condo market.

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Thumbscrews.

EU Freezes Brexit Talks Until Britain Produces Irish Border Solution (Ind.)

The EU has thrown down an ultimatum to Theresa May in Brexit talks, warning that it will not open discussions about trade or other issues until the Irish border question is solved. Speaking in Dublin alongside the Irish Prime Minister Leo Varadkar, European Council President Donald Tusk said talks would be a case of “Ireland first” and that “the risk of destabilising the fragile peace process must be avoided at all costs”. “We know today that the UK Government rejects a customs and regulatory border down the Irish Sea, the EU single market, and the customs union,” the Mr Tusk said. “While we must respect this position, we also expect the UK to propose a specific and realistic solution to avoid a hard border.

“As long as the UK doesn’t present such a solution, it is very difficult to imagine substantive progress in Brexit negotiations. “If in London someone assumes that the negotiations will deal with other issues first before the Irish issue, my response would be: Ireland first.” British negotiators have long been keen to move to discussions about trade and had hoped to do so after the March meeting of the European Council in two weeks, but Mr Tusk’s latest ultimatum suggests further delays could be in store. The EU says a withdrawal agreement must be negotiated by October to give it time to ratify the deal before the UK falls out of the bloc in March 2019.

Mr Tusk recalled that the Good Friday Agreement, whose 20th anniversary is next month, had been “ratified by huge majorities north and south of the border”. “We must recognise the democratic decision taken by Britain to leave the EU in 2016 – just as we must recognise the democratic decision made on the island of Ireland in 1998 with all its consequences,” he said, in a play on the rhetoric used by Brexiteers regarding the 2016 EU referendum. The EU27 nations granted the UK “sufficient progress” to move to the rest of Brexit talks in the December meeting of the European Council after the UK made a commitment to avoid a hard border on the island of Ireland at all costs.

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30-mile lines of waiting trucks. That was reason no. 1 to establish the EU. Well, they’re back.

Calais ‘To Be 10 Times Worse Than Irish Border’ After Brexit (G.)

The boss of the port of Calais has said there could be tailbacks up to 30 miles in all directions and potential food shortages in Britain if a Brexit deal involves mandatory customs and sanitary checks at the French ferry terminal. Jean-Marc Puissesseau made an impassioned plea to Theresa May and Michel Barnier to put plans in place immediately to avert congestion in Calais and Dover, where bosses have already warned of permanent 20-mile tailbacks. At the same time a leading politician for the Calais region said the problems in France would be 10 times worse than at the Irish border. At a private meeting at the European parliament, Xavier Bertrand, a former French health minister and the president of the Hauts-de-France political region, said politicians needed to grasp the magnitude of the problem.

“I know Ireland is going to be a real problem, but please remember the economic issues in Ireland are 10 times smaller than what is going to happen here,” he said. “This is a black scenario, but it is going to get darker and darker,” he said, urging politicians in Brussels and London to take urgent action by setting up working groups and listening to business. Bertrand angrily denounced those who had power to influence the Brexit outcome. It was not right that economic operators should be expected to “sit on their hands waiting very anxiously for something to happen”.

At the same meeting, Puissesseau said both sides would be affected by the problems at the ports, with suppliers from the UK trying to get their goods through strict EU controls treated no better than those from a developing country. “The UK is part of the 21st century. But this takes us back 100 years. This is sad,” he said. “From Brexit day, 100% of our traffic will be from outside the EU. I tell you honestly that GB will be a third country, this frightens me. There’s such a long history between the UK and EU.” “At the moment, 70% of food imported comes from the EU. Even if that goes down to 50% after Brexit because of controls, it still needs to flow smoothly; people still need to eat,” he said.

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$8,500 as I write this, -8.46%.

Bitcoin Tumbles Further In Broad Selloff For Cryptocurrencies (MW)

Selling intensified for digital currencies on Friday, as the price of the No.1 cryptocurrency bitcoin pushed below $9,000. The price of a single bitcoin fell 4.8% to $8,847.85, but bounced off a low of $8,370.80, according to CoinDesk. In a week, bitcoin has dropped around 20%. Losses were widespread across cryptocurrencies. Ether was down 4.5% to $671.66, bitcoin cash slid 6.4% to $970.66 and Litecoin fell 6.2% to $166.22, according to CoinDesk. Ripple tumbled 10% to $0.78, according to CoinMarketCap. The moves build on sharp drops on Thursday, which some suggested were due to technical factors.

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Winning.

US Is Experiencing The Highest Drug Overdose Death Rates Ever (ZH)

Across the United States, government officials are struggling to combat the next wave of the opioid epidemic, which is expected to deliver a massive blow to the heartland. A new report from the Centers for Disease Control and Prevention (CDC) confirms the opioid crisis has dramatically worsened since the second half of 2016. Raw data from hospital emergency rooms show a significant increase in drug overdoses across the U.S. In a press briefing on Tuesday, CDC Director Anne Schuchat, M.D., warned that the U.S. is currently experiencing the highest drug overdose death rates ever.

In the newly issued report, which examined data from 16 states, emergency department visits for suspected opioid overdoses jumped 30% from July 2016 through September 2017. In some regions of the country, overdoses were far more significant, but overall, data from most areas showed the opioid crisis is worsening, despite President Trump’s new initiative to tackle the epidemic.

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Save the symbols?!

Chinese Panda Conservation Park To Be Twice The Size Of Yosemite (G.)

The Bank of China has pledged at least 10bn yuan (£1.1bn) to create a vast panda conservation park in south-west Sichuan province, the Chinese forestry ministry has said. The Sichuan branch of the central bank signed an agreement with the provincial government to finance the vast national park’s construction by 2023. The park aims to bolster the local economy while providing the endangered animals with an unbroken range in which they can meet and mate with other pandas in order to enrich their gene pool.The ministry said the park will measure 2m hectares (5m acres), making it more than twice the size of Yellowstone national park in the US.

Zhang Weichao, a Sichuan official involved in the park planning, told the state-run China Daily the agreement would help alleviate poverty among the 170,000 people living within the project’s proposed territory. Plans for the park were initiated in January last year by the ruling Communist party’s central committee and the state council, the China Daily reported. Giant pandas are China’s unofficial national mascot and live mainly in the Sichuan mountains, with some in neighbouring Gansu and Shaanxi provinces. An estimated 1,864 live in the wild, where they are chiefly threatened by habitat loss. Another 300 live in captivity.

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By treating the oceans as our garbage bin, we will make it exactly that.

Discarded Fishing Gear Massacres Whales, Dolphins, Seals, Turtles, Birds (Ind.)

The world’s biggest seafood firms are all contributing to the deaths of more than 100,000 whales, dolphins, seals, turtles and seabirds that are killed in agony every year by discarded fishing equipment, according to a new report. Many of the creatures are drowned, strangled or mutilated by plastic gear lost or abandoned at sea, while others suffer “a prolonged and painful death, usually suffocating or starving” either because they cannot fish or their stomachs are full of plastic. Campaigners believe the fishing litter problem is becoming so bad that the oceans could end up unable to provide any catches for humans to eat.

They say “ghost gear” has become a huge but overlooked threat to marine life, and 640,000 tons of it are added to the oceans each year – a rate of more than a ton every minute. A new study analysed the approaches to fishing equipment of the world’s 15 biggest seafood companies, to rank them in five categories – but found that none could be ranked in the top two as having “best practice” or making “responsible handling” of their fishing gear integral to their business strategy. [..] The report, entitled Ghosts beneath the Waves, says abandoned and lost gear is four times more likely to trap and kill creatures than all other forms of marine debris combined, and more than 70% of visible plastic in the sea is fishing-related.

Microplastics – minuscule pieces – were found in the digestive tracts of 80% of seals tested off the coast of Ireland, while other research cited found that plastic accounted for 69% of the debris ingested by whales. Other studies said 98% of whale entanglements involved ghost gear, while 82% of North Atlantic right whales have become entangled at least once. “This is a huge crisis of animal suffering, yet hardly anyone is talking about it,” said World Animal Protection. In one deep water fishery in the north east Atlantic 25,000 nets have been recorded as lost or discarded each year, according to the report. “Even within small areas, the amount of ghost gear can be staggering,” it said. “The Florida Keys National Marine Sanctuary, for example, is estimated to be littered with 85,000 active ghost lobster and crab pots.

Read more …

Mar 062018
 
 March 6, 2018  Posted by at 11:16 am Finance Tagged with: , , , , , , , , , , ,  


Vincent van Gogh Le Moulin à Poivre, Montmartre 1887

 

EU Proposes Retaliatory Tariff of 25% Against U.S. Goods (BBG)
Trump’s Tariff Threat On European Cars Could Spell Big Trouble For Germany (CNBC)
Retail Investor Bullishness Collapses (WS)
World’s ‘Shadow Banks’ Continue To Expand (R.)
China to Ease Bad-Loan Provision Rules to Support Growth (BBG)
China Faces an ‘Impossible Challenge’ on Budget, Tax and GDP (BBG)
China’s Coming Meltdown Will Rapidly Spread to US (Rickards)
Sex, Money & Happiness (Roberts)
British Can’t Deliver Promises Of Frictionless Trade (Fintan O’Toole)
Canada’s Looming Economic Meltdown (GT)
Coinbase Accused of Cheating Consumers in More Ways Than One (BBG)
US, UK Support World’s Worst Humanitarian Disaster In 50 Years (CP)
Light It Up (Jim Kunstler)
The Ocean Currents Brought Us In A Lovely Gift Today (G.)

 

 

Trump said ‘if you don’t have steel, you don’t have a country’. Is he all that wrong?

EU Proposes Retaliatory Tariff of 25% Against U.S. Goods (BBG)

The EU is preparing punitive tariffs on iconic U.S. brands produced in key Republican constituencies, raising political pressure on President Donald Trump to ditch his plans for taxing steel and aluminum imports. Targeting $3.5 billion of American goods, the EU aims to apply a 25 percent tit-for-tat levy on a range of consumer, agricultural and steel products imported from the U.S. if Trump follows through on his tariff threat, according to a list drawn up by the European Commission and obtained by Bloomberg News. The list of targeted U.S. goods – including motorcycles, jeans and bourbon whiskey – sends a political message to Washington about the potential domestic economic costs of making good on the president’s threat.

Paul Ryan, Republican speaker of the House of Representatives, comes from the same state – Wisconsin – where motorbike maker Harley-Davidson is based. Earlier this week, Ryan said he was “extremely worried about the consequences of a trade war” and urged Trump to drop his tariff proposal. Other U.S. officials will also feel the pressure. Bourbon whiskey hails from Senate Majority Leader Mitch McConnell’s home state of Kentucky. San Francisco-based jeans maker Levi Strauss is headquartered in House Minority Leader Nancy Pelosi’s district. The EU’s retaliatory list targets imports from the U.S. of shirts, jeans, cosmetics, other consumer goods, motorbikes and pleasure boats worth around €1 billion; orange juice, bourbon whiskey, corn and other agricultural products totaling €951 million; and steel and other industrial products valued at €854 million.

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Tariff on US cars exported to Europe is 25%. Tariff on EU cars imported in US is 10%. Looks like there is room for talks there.

Trump’s Tariff Threat On European Cars Could Spell Big Trouble For Germany (CNBC)

The war of words between President Donald Trump and the EU could lead to some serious pressure on the German auto industry, one expert told CNBC. Trump threatened via Twitter on Saturday to hit back at any tariff measures from the European Union — floated in response to Trump’s recently announced global steel import tariffs — in kind. The billionaire businessman’s potential next target? European cars. And the biggest victim of them all may be Germany. “It would be quite severe if we were to face additional import duties to ship the cars into the U.S. — the Germans in particular are very, very exposed,” Arndt Ellinghorst, the head of global automotive research for advisory firm Evercore ISI, told CNBC Monday.

He noted the example of BMW, which sells about 350,000 cars in the U.S. annually, roughly 70% of which come from Europe. “That’s probably an $8 billion to $9 billion revenue stream, if you put a 5 to 10% additional cost on it, it would cost something like $400 million to $800 million. Some of that would be absorbed by the company, and some of it would have to be absorbed by the consumer in the U.S.” Ellinghorst did add that cars being shipped from the U.S. into Europe faced a 10% import duty while European cars into the U.S. faced a 2.5% import duty. “I think what the administration is talking about is to balance out this difference in tariffs to make it more of an equal playing ground for American and European carmakers,” he said.

Out of roughly six million cars exported by Europe in 2016, more than one million were absorbed by the U.S. — just over 16% — its largest country market by a wide margin. Meanwhile, of America’s $53.6 billion in car exports that same year, the value of its car exports into Europe was $11.8 billion, or roughly 22% of the total, according to the Observatory of Economic Complexity. The U.S. is the third-largest car exporter globally after Germany and Japan, accounting for 7.7% of total world exports. It ran a trade deficit of more than $151 billion overall with Europe in 2017.

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The aftermath of the reurn of volatility.

Retail Investor Bullishness Collapses (WS)

TD Ameritrade’s Investor Movement Index – “designed to indicate the sentiment of retail investors” based on what they’re doing in their accounts and “how they are actually positioned in the markets” – plunged 23% in February to 5.95, the biggest month-over-month plunge in the history of the index, “as volatility returned to the market.” This comes after a 9% plunge of the index in January, the largest month-over-month plunge in three years, which occurred despite the final spurt of the rally that took the stock market indices to new highs on January 26. It’s as if retail investors, for once, smelled a rat. After which the sell-off started:

TDA Chief Market Strategist JJ Kinahan explained in an interview that TDA’s clients “didn’t want to be as exposed” in February to risk “as they were.” “What’s interesting is they were net buyers, and they were net buyers because of the February 9th move,” he said. “They bought a lot of stocks that day. But as the month went on, they just continued to sell those stocks back out, and then some. So it was a really interesting pattern that developed.” The stocks they bought had “lower beta than some of the stocks they sold,” he said. “So it was really and truly a risk-off trade. But the bigger part about it is they lightened up their exposure across the board. So one or two days truly of buying,… but after that, not only selling what they’d bought that day, but selling on top of it what they’d bought earlier” this year and last year.

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Hard to gauge how much of a grip the Financial Stability Board has on the actual numbers. 2016 is the first time they include China. But what do they actually know, and how much is guesswork?

World’s ‘Shadow Banks’ Continue To Expand (R.)

Growth in global bond, real estate and money market funds continued to swell the world’s“shadow banking” sector, a watchdog that coordinates financial regulation for the G20 big economies said on Monday. The Financial Stability Board said its“narrow” measure of shadow banking activities that could pose a threat to stability, rose 7.6% to $45.2 trillion in 2016, the latest year for which figures have been collated. It represents 13% of total financial system assets in the 29 jurisdictions surveyed. Data from China and Luxembourg were included in the measure for the first time. “Non-bank financing provides a valuable alternative to bank financing and helps support real economic activity,” the FSB said in its report. Nevertheless, increased reliance on non-bank funding could give rise to new risks, it said.

The so-called shadow banking sector, made up of companies other than banks that provide financial services, has been treated with suspicion by some regulators since the financial crisis a decade ago. Still, it has some champions among policymakers who say it helps keep capital markets more liquid. The European Union actively courts participants to diversify away from heavy reliance on bank loans for EU companies. Apart from debt investment funds, the measure of shadow banking also includes the repurchase and debt securitization markets as well as hedge funds involved in credit. Faced with few rules in the past, sub-sectors like securitization are now regulated and seen to pose less risk to stability.

Open-ended bond funds, hedge funds that offer credit and money market funds account for 72% of the narrow measure, and grew by 11% in 2016. Regulators have asked funds to have safeguards in place for extreme market turbulence to avoid instability from fire sales of assets if many investors ask for their money back. The United States accounts for 31% of the narrow measure, followed by China with 16%, the Cayman Islands at 10% and Japan at 6%. A broader measure, which includes all financial firms that are not central banks, banks, pension funds or insurers, rose 8% to $99 trillion to represent 30% of global financial assets, its highest level since at least 2002, the FSB said.

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How transparent are these shadows?

China to Ease Bad-Loan Provision Rules to Support Growth (BBG)

China is relaxing rules governing how much banks must set aside to cover bad loans, people with knowledge of the matter said, a sign that regulators are comfortable the nation’s lenders are sound enough to extend additional credit and support the economy. The China Banking Regulatory Commission has issued a notice lowering the bad-loan coverage ratio to a minimum 120% from the previous 150%, the people said, asking not to be identified as the matter isn’t public. Relaxed bad-loan coverage rules will allow banks to extend more credit, supporting an economy the government expects to expand about 6.5% this year, a slower pace than in 2017. Additional lending from giants such as Industrial & Commercial Bank of China would also counter some of the effects on the economy of President Xi Jinping’s campaign to curb financial risk, one of the government’s top priorities.

The changes also indicate regulators are confident that they’ve come to grips with a bad-loan epidemic that plagued lenders over the past few years. In 2016, when problem loans at Chinese banks were on the rise, the CBRC resisted lobbying from the nation’s lenders to relax the provisioning thresholds. The timing of the CBRC move suggests that “nonperforming loans are not a problem,” analysts at Shenwan Hongyuan said in a research note. [..] According to the notice, the CBRC will differentiate the amount of provisions an individual bank must hold within the new band of 120% to 150%, based on the level of its capital, the accuracy of its loan classification policies and its proactiveness in handling nonperforming loans, the people said.

China’s banking industry has a bad loan coverage ratio above 180%, CBRC official Xiao Yuanqi said at a briefing last week, indicating banks have plenty of room to reduce provisions. As well as lowering the threshold, the CBRC notice said it will reduce the amount of provisions banks must hold against their total loan book, including healthy loans, to as low as 1.5% from the previous 2.5% minimum.

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They can’t have it all.

China Faces an ‘Impossible Challenge’ on Budget, Tax and GDP (BBG)

Premier Li Keqiang has an “impossible challenge” if he wants to slash China’s budget deficit target, deleverage the economy, and cut taxes, according to Pantheon Macroeconomics. Li on Monday said this year’s deficit goal was cut to 2.6% of gross domestic product, from 3%, the first reduction since 2012. At the same time, he pledged tax cuts of 800 billion yuan ($126 billion) for companies and individuals and set a 6.5% annual economic growth target – the same as last year’s target but slower than the actual performance of 6.9%. “These targets suggest tight monetary conditions and tight fiscal policy, with GDP growth holding up, despite an intensified deleveraging campaign,” said chief Asia economist Freya Beamish in London. “Something’s got to give. We reckon it’s fiscal policy, though monetary policy could also turn out on the easier side, with the yuan also set to weaken.”

[..] While China is aiming for a narrower official deficit, leaders still plan to expand the issuance of special purpose bonds, which are sold by local governments to finance items that aren’t included in the general public budget and not counted in the deficit ratio released annually. Local governments have used special bonds to help pay for highways, railroads and other construction projects in recent years, and the securities are designed to be covered by returns of the projects rather than general revenues. Special purpose bond issuance will jump to 1.35 trillion yuan this year to prioritize “supporting ongoing local projects to see them make steady progress,” the Finance Ministry said Monday. That’s up from 800 billion yuan in 2017 and 400 billion yuan in 2016.

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An entire series of companies guaranteeing each other’s debt. How does that surface in those shadow reports?

China’s Coming Meltdown Will Rapidly Spread to US (Rickards)

The coming credit crisis in China is no secret. China has $1 trillion or more in bad debts waiting to explode. These bad debts permeate the economy. Some are incurred by Chinese provincial authorities trying to get around spending limitations imposed by Beijing. Some are straight commercial loans on bank balance sheets. Some are external dollar-denominated debts owed to foreign creditors. The most dangerous type of debt involves a daisy chain of insolvent corporations buying debt from each other. A single cash advance of $100 million can be passed from corporation to corporation in exchange for a new promissory note, used to extinguish an old unpayable promissory note. Repeated enough times, the $100 million can be used as window dressing to prop up $1 billion or even $2 billion of bad debts.

These kinds of accounting tricks will land you in jail in the U.S., but it’s an accepted practice in China as long as the corporate CEO is a “Princeling” (a politically connected Communist Party insider descended from the old guard) or an oligarch willing to pay bribes. This state of affairs has existed for years. The question investors keep asking is, “How long can this last?” How long can the daisy chain keep operating to gloss over a sea of bad debt and give the Chinese economy an appearance of good health? Well, the answer is the Ponzi will not likely last much longer. Even compliant Chinese regulators are starting to blow the whistle on bad loans and the banks that cover them up. So the good news is that China is starting to address the problem. The bad news is that if China gets serious about cleaning up bad debts, their growth will slow significantly and so will world economic growth.

That’s bad news for global stock markets. Essentially, China is on the horns of a dilemma with no good way out. On the one hand, China has driven growth for the past eight years with excessive credit, wasted infrastructure investment and Ponzi schemes like wealth management products (WMPs). The Chinese leadership knows this, but they had to keep the growth machine in high gear to create jobs for millions of migrants coming from the countryside to the city and to maintain jobs for the millions more already in the cities. The Communist Chinese leadership knew that a day of reckoning would come. The two ways to get rid of debt are deflation (which results in write-offs, bankruptcies and unemployment) or inflation (which results in theft of purchasing power, similar to a tax increase). Both alternatives are unacceptable to the Communists because they lack the political legitimacy to endure either unemployment or inflation. Either policy would cause social unrest and unleash revolutionary potential.

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Americans can’t get away from the money makes you happy syndrome.

Sex, Money & Happiness (Roberts)

“Sex” and “Money” are probably two of the most powerful words in the English language. First, those two words got you to look at this article. They also sell products, books, and services from “How To Have Better Sex” to “How To Make More Money” — ostensibly so you can have more of the former. Unfortunately, they are also the two primary causes of divorce in the country today. But “happiness,” is also an interesting word because it is ultimately derived from the ability to obtain money and the lifestyle with which it will afford. Researchers at Purdue University recently studied data culled from across the globe and found that “happiness” doesn’t rise indefinitely with income. In fact, there were cut-off points at which more annual income had a negative effect on overall life satisfaction.

So, what’s that number? In the U.S., $65,000 was found to be the optimal income for “feeling” happy. In the U.S., despite higher levels of low income (now there’s an oxymoron), inflation-adjusted median incomes have remained virtually stagnant since 1998.

However, the chart above is grossly misleading because the income gains have only occurred in the Top 20% of income earners. For the bottom 80%, they are well short of the incomes needed to obtain “happiness.”

For most American “families”, who have to balance their living standards to their income, the “experience” of “happiness” is more of a function of “meeting obligations” each and every month. Today, more than ever, the walk to the end of the driveway has become a dreaded thing as bills loom large in the dark crevices of the mailbox. If they can meet those obligations, they are “happy.” If not, not so much.

In my opinion, what the study failed to capture was the “change” in what was required to achieve “perceived” happiness following the “financial crisis.” Just as with “The Great Depression,” individuals forever altered their feelings about banks, saving and investing after an entire generation had lost “everything.” It is the same today as sluggish wage growth has failed to keep up with the cost of living which has forced an entire generation into debt just to make ends meet. As the chart below shows, while savings spiked during the financial crisis, the rising cost of living for the bottom 80% has outpaced the median level of “disposable income” for that same group. As a consequence, the inability to “save” has continued.

[..] Not surprisingly, the “financial stress” in American households is leading to other factors which are fueling the “demographic” problem in the future. The equation is very simple – when individuals are stressed over finances they are less active sexually. This was shown in a recent study by the National Bureau of Economic Research. Ahead of the past three US recessions, the number of conceptions began to fall at least six months before the economy started to contract. As the FT notes, while previous research has shown how birth rates track economic cycles, the scientific study is the first to show that fertility declines are a leading indicator of recessions. [..] To the researchers’ surprise, they found that falls in conceptions were a far better leading indicator of recessions than many commonly used indicators such as consumer confidence, measures of uncertainty, and purchases of big-ticket items such as washing machines and cars.

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Sheer incompetence. Much more of that to come.

British Can’t Deliver Promises Of Frictionless Trade (Fintan O’Toole)

In 2016, more than 310 million people and nearly 500 million tonnes of freight crossed the UK’s borders. If this continues to happen in a “frictionless” way after Brexit, the disturbances to the status quo in Ireland will be limited. If it doesn’t, hang on to your hats. Frictionless trade is the only condition under which Brexit can happen without inflicting a hard border on Ireland. It is almost certainly a political impossibility if the UK leaves the customs union. But even if it could somehow be agreed in principle, there is another enormous obstacle: the actual capacity of the British to handle it. On Friday, after Theresa May’s big set-piece speech on Brexit, the DUP leader Arlene Foster issued a glowing endorsement. She referred back to a paper issued by the UK government last August: “Those proposals can ensure there is no hard border between Northern Ireland and the Republic of Ireland after we exit the EU.”

Foster recognises how much unionism is staking on that document and on the ability of the UK’s bureaucracies to deploy technology to take the sting out of the potentially toxic irritant of the Irish Border. This forces us to consider something that would previously have been of little interest to Irish people: the recent and dismal history of the UK’s adventures in using digital technology to control its borders. In 2003, the British established a spanking new “e-borders” system which was meant to collect and analyse advance passenger information for people travelling into the UK. It had a generous timescale – the full programme was meant to be in place by 2011. In 2010, the Home Office admitted that e-borders was so useless it had to be abandoned. By then, it had spent £340 million (€380 million) on the programme.

The cancellation of the contract led to a legal settlement for another £150 million. The Home Office then spent another £303 million on a new programme, bringing expenditure to £830 million. In 2015, the National Audit Office reported that all of this expenditure “has failed, so far, to deliver the full vision” of what was supposed to be achieved. The current date for completion of the programme is 2019. The whole thing will have taken a mere 16 years. On the same timescale, the new post-Brexit systems on which the future of Ireland may hinge would be delivered in 2035. In 2015, 55 million UK customs declarations were made by 141,000 traders. Once Brexit happens, that will increase fivefold to 255 million. Leaving aside all the issues of political principle, this is the vast logistical challenge that will have to be dealt with if May and Foster are to get the Brexit they want.

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The numbers are interesting, the political stance not so much.

Canada’s Looming Economic Meltdown (GT)

Canada’s Fourth Quarter economic growth was 1.7% following positive signs of growth earlier in the year. This growth, however modest, is attributable to easy credit and the increased consumer spending. At this time, Canadian households are facing one the largest indebtedness when compared to most other countries. For every $1.00 of income, consumers owe $1.68. This is the highest income to debt ratio in the world. For low-income Canadian households, the $1.00 disposable income to $3.33 debt ratio is even worst. Canada, along with other nations, especially emerging markets are carrying records levels of consumer debts, may be facing a serious crash as further growth becomes unsustainable.

Canada combined deficit rose to $18.1 billion in 2016, from $12.9 billion in the previous year. Higher debts and increased spending are causing serious concerns that the Canadian economy is on an unsustainable economic path. A considerable portion of Canada’s future economic growth has been predicated on strengthening and improving the country’s infrastructure. However, Prime Minister Trudeau’s policies are destined to strangle potential economic growth by shifting C$7.2 billion allocated to infrastructure improvements to government programs such as gender equality hiring opportunities. According to the Conference Board of Canada’s Craig Alexander: “This isn’t a budget that’s about growth, as much as it’s about equality and breaking down barriers to opportunity.”

Canada appears to be stunting its own economic growth as a matter of policy. Three major infrastructure projects, The Northern Gateway pipeline ($7.9 billion), the Pacific Northwest LNG project ($36 billion), and possibly the Energy East pipeline ($15.7 billion) would have been instrumental in guaranteeing economic growth for decades to come. However, these have been stymied in favor of Trudeau’s economic egalitarian vision. As a result, investors have been abandoning certain projects. The last time Canada’s saw such heavy-handed government interference in its economy was during the presidency of Trudeau’s father, Pierre Trudeau.

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This could hurt.

Coinbase Accused of Cheating Consumers in More Ways Than One (BBG)

Coinbase was slapped with a pair of lawsuits by disgruntled consumers, one alleging insider trading by employees at the giant digital currency exchange and the other accusing the company of failing to deliver cryptocurrencies to people who didn’t have accounts. The class-action suits come as Coinbase and other crypto startups are beefing up their staffs with regulatory experts to legitimize themselves as they prepare for government authorities to impose stricter rules. The first of the complaints filed in San Francisco federal court centers on Coinbase’s announcement in December that it would enable purchases of the bitcoin spinoff known as Bitcoin Cash. The customer who sued alleges that employees were tipped off a month in advance, allowing them to instantly swamp Coinbase with buy and sell orders and leaving other traders at a great disadvantage.

Coinbase CEO Brian Armstrong said at the time that the company would investigate an increase in the price of bitcoin cash in the hours before its Dec. 19 announcement and that any employee or contractor found to have violated internal policies would be terminated. “To date, neither Armstrong nor the company has disclosed the result of its purported investigation,” according to the March 1 lawsuit. In the other suit, two men claim that they were unable to redeem bitcoin that had been transferred to them through Coinbase via their email addresses in 2013. They allege that when they got reminder notices in February, they tried to recover the bitcoin only to discover that the links provided by Coinbase were broken. They accused the company of keeping their funds and say they want to represent “thousands” of other people in the same position.

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As long as the press continue to ignore this, who cares really?

US, UK Support World’s Worst Humanitarian Disaster In 50 Years (CP)

“The situation in Yemen – today, right now, to the population of the country,” UN humanitarian chief Mark Lowcock told Al Jazeera last month, “looks like the apocalypse.” 150,000 people are thought to have starved to death in Yemen last year, with one child dying of starvation or preventable diseases every ten minutes, and another falling into extreme malnutrition every two minutes. The country is undergoing the world’s biggest cholera epidemic since records began with over one million now having contracted the disease, and new a diptheria epidemic “is going to spread like wildfire” according to Lowcock. “Unless the situation changes,” he concluded, “we’re going to have the world’s worst humanitarian disaster for 50 years”.

The cause is well known: the Saudi-led coalition’s bombardment and blockade of the country, with the full support of the US and UK, has destroyed over 50% of the country’s healthcare infrastructure, targeted water desalination plants, decimated transport routes and choked off essential imports, whilst the government all this is supposed to reinstall has blocked salaries of public sector workers across the majority of the country, leaving rubbish to go uncollected and sewage facilities to fall apart, and creating a public health crisis. A further eight million were cut off from clean water when the Saudi-led coalition blocked all fuel imports last November, forcing pumping stations to close.

[..] As of late January, fuel imports through the country’s main port Hodeidah were still being blocked, with cholera cases continuing to climb as a result. And on 23rd January, the UN reported that there are now 22.2 million Yemenis in need of humanitarian assistance – 3.4 million more than the previous year – with eight million on the brink of famine, an increase of one million since 2017.

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America’s fast becoming a cartoon nation.

Light It Up (Jim Kunstler)

It must be hard on The New York Times editors to set their hair on fire day after day in their effort to start World War Three. Today’s lead story, Russian Threat on Two Fronts Meets Strategic Void in the U.S., aims to keep ramping up twin hysterias over a new missile gap and fear of Russian “meddling” in the 2018 midterm elections. The Times’s world-view begins to look like the script of a Batman sequel with Vlad Putin cast in The Joker role of the cackling psychopath who must be stopped at all costs! America’s generals have switched on the Batman signal beacon, but Donald Trump in the role of the Caped Crusader, merely dithers and broods in the splendid isolation of his 1600 Penn Avenue Bat Cave, suffering yet another of his endless bipolar identity crises.

For God’s sake, The Times, shrieks, do something! The Russians are coming! (Gotham City’s Chief of Police Hillary said exactly that last week in a Tweet!) I think they misunderstood Mr. Putin’s recent message when he announced a new hypersonic missile technology that would, supposedly, cut through any imaginable US missile defense. The actual message, for the non mental defectives left in this drooling idiocracy of a republic, was as follows: Nuclear war remains unthinkable, so kindly stop thinking about it. Mr. Putin’s other strategic position is also misrepresented — actually, not even acknowledged — in Monday’s NYT propaganda blast, namely, to discourage the USA’s decades-long policy of regime change here, there, and everywhere on the planet, creating a debris trail of one failed state after another.

As a true-blue American, I must say these are two admirable propositions. Is it fatuous to add that atomic war is unlikely to benefit anyone? Or that the world has had enough of US military “meddling” in foreign lands? Of course the shopworn trope of Russian “meddling” in the 2016 election still occupies the center ring of the American political circus. Today’s Times story includes another clumsy attempt to set up expectations that the 2018 midterm elections will be hacked by Russia, in order to keep the hysteria at code-red level. As usual, the proposition assumes that the alleged 2016 hacking is both proven and significant when, going on two years, there is no evidence of hacking besides the obviously amateurish Facebook troll farm.

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Sickening to watch.

The Ocean Currents Brought Us In A Lovely Gift Today (G.)

A British diver has captured shocking images of himself swimming through a sea of plastic rubbish off the coast of the Indonesian tourist resort of Bali. A short video posted by diver Rich Horner on his social media account and on YouTube shows the water densely strewn with plastic waste and yellowing food wrappers, the occasional tropical fish darting through the deluge. The footage was shot at a dive site called Manta Point, a cleaning station for the large rays on the island of Nusa Penida, about 20km from the popular Indonesian holiday island of Bali. In a Facebook post on 3 March Horner writes how the ocean currents had carried in a “lovely gift” of jellyfish and plankton, and also mounds and mounds of plastic.

“Plastic bags, plastic bottles, plastic cups, plastic sheets, plastic buckets, plastic sachets, plastic straws, plastic baskets, plastic bags, more plastic bags, plastic, plastic,” he says, “So much plastic!” The video shows Horner swimming through the mess for several minutes and also how the waste coagulated on the surface, mixing in with some organic matter to form a slick of floating rubbish. Manta Point is regularly frequented by numerous manta rays that visit the site to get cleaned of parasites by smaller fish, but the video shows just one lone manta in the background. “Surprise, surprise, there weren’t many mantas there at the cleaning station today…” notes Horner, “They mostly decided not to bother.”

Several weeks ago thousands across Bali took part in a mass clean up, in attempt to rid the island’s beaches, rivers and jungles of waste, and raise awareness about the harmful impacts of trash. Rich Horner said that while divers regularly see “a few clouds of plastic” in the rainy season, the slick he identified is the worst yet. Divers returned to the site the next day, he reports, by which time the slick had already moved on, “continuing on its journey, off into the Indian Ocean..”

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Feb 282018
 
 February 28, 2018  Posted by at 11:09 am Finance Tagged with: , , , , , , , , , , , ,  


Vincent van Gogh Le moulin de la galette 1886

 

Fed Chairman Powell: Market Volatility Won’t Stop More Rate Hikes (CNBC)
The Albatross Of Debt Part 4 (David Stockman)
Slowing Euro-Area Inflation Helps Draghi Push Back Exit Debate (BBG)
Banks Have The Right To ‘Do What They Want’ In Leveraged Lending: Otting (R.)
EU and China Consider Retaliation To Potential Trump Tariffs (CNBC)
People in Sweden at Risk of Losing Access to Cash Altogether (BBG)
May Is Ready to Fight With EU Over Draft Brexit Deal (BBG)
“We’ve Got To DO Something About Syria!” Uh, No You Don’t. Please Don’t. (CJ)
Protesters in FYROM Decry Proposed ‘Macedonia’ Name Compromise (AP)
World’s First Plastic-Free Aisle Opens In Netherlands Supermarket (G.)
Arctic Warming: Scientists Alarmed By ‘Crazy’ Temperature Rises (G.)

 

 

The news about Powel’s first speech is as boring as the man himself. “We’re doing so well I just gotta wear shades..”

Fed Chairman Powell: Market Volatility Won’t Stop More Rate Hikes (CNBC)

Federal Reserve Chairman Jerome Powell played down concerns about recent market volatility, arguing Tuesday that the dramatic swings do not weigh heavily on his outlook for the economy and maintaining his expectation for further gradual increases in interest rates. In Capitol Hill testimony, Powell emphasized that the job market remains robust, consumer spending is solid and wage growth is accelerating. He also highlighted gains in U.S. exports and stimulative fiscal policy as new “tailwinds” for the economy. “After easing substantially during 2017, financial conditions in the United States have reversed some of that easing,” he said in prepared remarks. “At this point, we do not see these developments as weighing heavily on the outlook for economic activity, the labor market and inflation. Indeed, the economic outlook remains strong.”

Powell’s appearance before the House Financial Services committee was his first as the powerful chairman of the world’s most influential central bank. The Fed has been aiming to boost inflation to 2%, but the recent pickup in monthly readings has spooked some investors who worry the central bank might overshoot its target. Instead, Powell’s remarks suggested the firmer data give Fed officials confidence they will actually hit a goal that has long proved elusive. He characterized inflation as “low and stable.” “Despite the recent volatility, financial conditions remain accommodative. At the same time, inflation remains below our 2% longer-run objective. In the FOMC’s view, further gradual increases in the federal funds rate will best promote attainment of both of our objectives.”

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Stockman has the best assessment of Powell. A longtime and clueless Fed puppet with no opinion of his own.

The Albatross Of Debt Part 4 (David Stockman)

Donald Trump is all about delusional and so are the casino punters. They keep buying what the robo-machines are buying, which, in turn, persist in feasting on the dip because it’s there and because it’s worked like a charm for nine years running. So doing, the punters have become downright reckless. After all, the market was already sky high last January – trading at 23X earnings on the S&P 500 and resting precariously on a record $554 billion of margin debt . Yet in order to load up on even more of these ultra risky shares, punters have since added $112 billion to their already staggering margin accounts, thereby helping to propel the S&P index to a truly ludicrous 27X by the end of January 2018.

And therein lies the true danger of the Fed’s 30-year long regime of Bubble Finance and the $67 trillion of debt it has piled upon the US economy. To wit, it has completely unmoored Wall Street from the main street economy, meaning that the speculative momentum and internals of the casino are operating in free flight: They will just keep levitating financial asset prices higher until some powerful shock triggers another meltdown of the type experienced during 2008, 2000 and 1987.

We happen to believe strongly that a bond market “yield shock” will be the crash-trigger this time around and for a self-evident reason. The central banks of the world have unleashed a credit monster – $67 trillion in the US, $40 trillion or more in China and $230 trillion on a global basis—and know they must finally stop the relentless monetization of existing debt and other assets. The leadership for that task falls to the new Fed Chairman, Jerome Powell, who is a dyed-in-the-wool Keynesian and lifetime crony capitalist bubble rider. Indeed, during the 45 meetings during which he served as a member of the Bernanke-Yellen Fed, he did not dissent a single time.

So he now owns the epic bubble generated by that madcap regime of massive money printing and drastic interest rate repression, but through his Keynesian beer goggles Powell is thoroughly clueless about the resulting giant disconnect between main street and Wall Street. Accordingly, he seems to think that there is a strong full-employment economy on main street, when it’s nothing of the kind; and a reformed, prudently regulated banking system at the center of Wall Street, when in fact it’s teeming with the fruits of relentless speculation – FANGS, leveraged ETFs, options gambling, risk parity trades, structured finance deals loaded with hidden risk and debt and countless more.`

In other words, the Fed’s new chairman avers that there is smooth sailing ahead, even suggesting to Congress today that the US economy is blessed with considerable tailwinds – including exports and fiscal policy! We will address that tommyrot below, but what’s ahead is tumult, not smooth. That’s because the disconnect between a flat-lining main street economy and Wall Street’s bubble ridden financial house of cards is blatantly unstable and unsustainable. Indeed, this fraught condition, which Powell and his Keynesian posse fail to see, will soon give rise to a thundering upheaval triggered by the Fed’s own action.

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And Draghi too just keeps claiming the economy is doing great, and it’s due to him.

Slowing Euro-Area Inflation Helps Draghi Push Back Exit Debate (BBG)

A third month of slowing inflation in the euro-area has given European Central Bank President Mario Draghi ammunition to ward off the hawks a little while longer. The rate of price growth slowed to 1.2% this month from 1.3%, dropping to its weakest since 2016. The core measure was unchanged at 1%. The figures follow a series of releases that have checked the economy’s thundering momentum at the start of 2018, which had emboldened policy makers who want a faster unwinding of the central bank’s crisis-era monetary stimulus. Draghi emphasized to European lawmakers this week that an expansionary policy is still warranted even as the economic situation is “improving constantly.”

At the same time, he’s more confident that declining unemployment will boost pay and inflation eventually, even if the rate remains below the ECB’s target of just under 2% for now. The ECB’s Governing Council meets next week and is likely to discuss a change in its policy language to pave the way for an end of quantitative easing. Executive Board member Benoit Coeure – an architect of the program who has more recently taken a hawkish turn – said last week that the ECB can afford to slow bond purchases, as long as it gives clear guidance on the path of interest rates. Bundesbank President Jens Weidmann, who has long argued in favor of unwinding stimulus, chimed in on Tuesday, saying in a Bloomberg TV interview that the ECB’s guidance on interest rates is “rather vague” and could be strengthened as the end of bond buying approaches.

The European Commission said on Tuesday euro-area economic sentiment slipped for a second month in February after touching a 17-year high in December. Data last week showed business confidence in Germany and manufacturing and services activity in the euro area all weakened more than economists forecast. Such bumps along the road of Europe’s recovery from the ravages of its debt crisis underscore why Draghi is not yet ready to pare back support for the euro area.

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You mean the ones we bailed out, right?

Banks Have The Right To ‘Do What They Want’ In Leveraged Lending: Otting (R.)

Banks have the “right” to do the leveraged lending they want as long as it does not impair their “safety and soundness,” Joseph Otting, Comptroller of the Currency, said on Tuesday. Otting was speaking to an audience at the ABS Vegas conference co-hosted by SFIG, in response to a question from the audience about whether the OCC would be more lenient with banks about leveraged lending. The Government Accounting Office, the investigative arm of the US Congress, said last October that US bank guidelines on leveraged lending are subject to Congressional review, clearing the way for them to possibly be overturned. The GAO said the guidelines, which critics said have hampered the leveraged debt market, are under the purview of the Congressional Review Act of 1996, which they would not be if the GAO had deemed them to be less formal instruments of policy.

“As long as banks have the capital, I am supportive of banks doing leveraged lending,” said Otting. That stands even if leveraged lending activities transgresses guidelines, he said. “When (the idea of the) guidance came out – it was like people were afraid to jump over the line without feeling the wrath of Khan from the regulators,” Otting said. “But you have the right to do what you want as long as it does not impair safety and soundness. It’s not our position to challenge that.” US regulators said they are open to revising restrictions on leveraged lending, offering an olive branch to a Republican-controlled Congress keen to roll back banking regulations. The response from regulators indicated a desire to avoid a protracted battle with a Congress.

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Trump the anti-globalist. That should appeal to some people.

EU and China Consider Retaliation To Potential Trump Tariffs (CNBC)

As the Trump administration considers what action to take on trade tariffs on steel and aluminum, EU and Chinese officials are considering taking aim at politically strategic products made in the U.S., such as bourbon and motorcycles. Of the options laid out by Commerce Secretary Wilbur Ross, the administration is considering the most wide-reaching penalty: slapping tariffs on all steel and aluminum imported into the U.S., not just imports from specific countries. The EU is targeting products with political punch, revisiting a list compiled during George W. Bush-era trade disputes of symbolic American brands. Potentially in the EU’s sights: items such as Harley-Davidson motorcycles, whose corporate headquarters is in House Speaker Paul Ryan’s home state of Wisconsin.

Bourbon is another target, having enjoyed a surge in exports to the EU. Senate Majority Leader Mitch McConnell’s home state of Kentucky exported $154 million worth of bourbon to the EU, up from $128 million in 2016, according to data from the International Trade Commission. Agriculture products such as cheese, orange juice, tomatoes and potatoes are also targets for retaliation. “The EU stands ready to react swiftly and appropriately in case our exports are affected by any restrictive trade measures from the U.S.,” a European Commission source tells CNBC. The counterpunch from China could land harder because of the scale of trade between the two countries and the reliance of American farmers on China as an export destination. China’s Ministry of Commerce is already investigating whether to limit imports of U.S. sorghum, a cereal grain used to feed livestock, in response to previous tariffs from the White House on solar panels and washing machines.

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NOW they find out: “Cash is important in a crisis situation…”

People in Sweden at Risk of Losing Access to Cash Altogether (BBG)

People living in the world’s most cashless society may soon lose their access to notes and coins. To avoid that extreme scenario, Swedish cash-handling provider Loomis wants authorities to force banks and retailers to continue accepting cash. The warning follows similar calls from the Swedish central bank, which is worried that the rapid disappearance of cash will ultimately lead to the disintegration of the infrastructure needed to use notes and coins and undermine its task to promote a safe and efficient payment system. “We have to have cars, vaults and all that, and in order to maintain the infrastructure we also need a base volume,” Loomis CEO Patrik Andersson said in an interview. He says Sweden’s more remotely populated areas in the north are most at risk of losing access to cash.

Such a scenario would be worrying in the event of natural disaster or a technological breakdown, with Swedes potentially unable to buy the basics needed to survive. “Cash is important in a crisis situation,” Andersson said. “Swedes don’t maybe have the insight to understand the effects of such a crisis, that it pervades the whole community.” A parliament committee reviewing the broader framework for the Riksbank plans to publish a special report this summer looking at the challenges posed by declines in cash usage. Riksbank Governor Stefan Ingves this week called for legal changes to safeguard the central bank’s governance of the payment system amid the rapid decrease in the use of cash. [..] The amount of cash in circulation in Sweden last year dropped to the lowest level since 1990 and is now more than 40% below its 2007 peak. The declines in 2016 and 2017 were the biggest on record.

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Much as you may wish this were to vanish from the news, it’ll drag on for a very long time.

May Is Ready to Fight With EU Over Draft Brexit Deal (BBG)

Prime Minister Theresa May is preparing to reject the EU’s draft Brexit deal when it’s published Wednesday, a senior official said, as her government steps up its fight with the bloc over the terms of Britain’s departure. With just three weeks left to agree on the Brexit transition phase, the EU will unveil a legal text that’s likely to infuriate euroskeptics in May’s Conservative government, piling further pressure on the premier at a critical time. According to the senior official, May will take on the EU over two of its key proposals that are unacceptable to her government. These are allowing the European Court of Justice to oversee the final deal, and arranging a separate trading regime for Northern Ireland – which, although it could avoid a “hard border” with Ireland, would impose new barriers with mainland Britain.

Almost a year in since May triggered the U.K.’s withdrawal from the 28-nation club, talks have yet to begin on what kind of trade accord will follow. Time is running out to limit the damage this ongoing uncertainty will cause to British businesses, who want a status quo transitional phase to be agreed by the end of March at the latest, to help them prepare and adapt when Britain leaves in March 2019. Yet key conflicts remain unresolved between the U.K. and the EU negotiating teams. “I maintain the evaluation that I gave you three weeks ago, which is that in light of these divergences, that we haven’t achieved the transition,” EU chief negotiator Michel Barnier said Tuesday. His remarks raise the prospect that the deal will miss its crucial end-March deadline.

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Caitlin Johnstone has it right. It’s out leadership that has turned Syria into such a mess (like Lybia, Iraq), not Assad or Putin.

“We’ve Got To DO Something About Syria!” Uh, No You Don’t. Please Don’t. (CJ)

Arguing that the western war machine is a good way to bring about peace and justice is like arguing that a bulldozer is a useful tool for brain surgery. Arguing that the western war machine is a good way to bring about peace and justice in Syria is like arguing that the gasoline which was used to start a house fire can also be used to extinguish it. The cutesy fairy tale you will hear from empire loyalists is that what started out as peaceful protests slowly morphed into a battle between the Syrian government and various terrorist factions, with the west only backing the terrorists later on in the conflict. This is false. [..] This has never been about “saving children”; this is about money, power, and resources, which are all of course ultimately the same thing as far as the empire is concerned.

Longtime US rival Russia has recently been awarded exclusive rights to oil and gas production in Syria in return for its efforts in helping its longtime ally stop the regime change, a predictable step in the fight for fossil fuel dominance in the region. Syria’s border dispute with Israel over the Golan Heights means that Israel has every reason to want to keep Syria destabilized, not only because the Golan Heights contains oil but because it provides a third of Israel’s water supply. Bashar al-Assad also launched what he called his “Five Seas Vision” in 2004, a strategy to use Syria’s supreme geographic location to become an economic superpower. Such a plan wouldn’t sit well with the US hegemon, which can only maintain its dominance by keeping other nations down.

“Once the economic space between Syria, Turkey, Iraq and Iran becomes integrated, linking the Mediterranean, the Caspian Sea, the Black Sea and the Arabian Gulf, will not only be important in the Middle East,” Assad once famously said in 2009. “When these seas are connected, we will become the inevitable intersection of the whole world in investment, transportation, and more.” It’s not hard to imagine how the imperialists would suddenly accelerate the urgency of removing Assad once he began speaking like that. Go try and find anything damning about Bashar al-Assad in the western mainstream media prior to 2009. You’ll find a bunch of positive expressions, including a nomination for honorary knighthood in 2002 by British Prime Minister Tony Blair. Interesting how he then suddenly transformed overnight into a bloodthirsty sexual sadist who gets off on gassing children to death for no reason.

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The name dispute continues. Came upon a map recently (below), which explains quite well why Greeks don’t want FYROM to call itself Macedonia: 90% of former Macedonia is in Greece.

Protesters in FYROM Decry Proposed ‘Macedonia’ Name Compromise (AP)

Several thousand protesters rallied in Skopje, the capital of the Former Yugoslav Republic of Macedonia (FYROM), late Tuesday for the government to call off talks with Greece aimed at settling a decades-long name dispute. The protesters marched peacefully from the main Orthodox cathedral in Skopje past the European Union office, chanting “Macedonia! Macedonia!” and waving national flags. Prime Minister Zoran Zaev’s 9-month-old center-left government has opened negotiations with Greece to resolve the dispute over the country’s name. Greece says the country’s name in its current form implies a territorial claim against its own region of Macedonia. Zaev has said he is willing to support a modified name. But the head of the so-called “World Macedonian Congress” group, Todor Petrov, told the protesters that changing the country’s name would be tantamount to committing treason.

“Our country has a name….To change it would mean that the Macedonian identity would be permanently lost,” he said. The rally was organized by several hard-line nationalist associations. The rally ended peacefully, but a Greek flag was burned during the march. Greeks also held a large rally in Athens earlier this month to reject a proposed compromise. Zaev has said he could accept a “geographical qualifier” in Macedonia’s name – such as “new”, “upper” or “north” – to forge a compromise, but insisted the new name must “respect the dignity” of people in both countries. Greece is also seeking changes in FYROM’s Constitution to eliminate what Athens considers tacit territorial claims. FYROM insists constitutional amendments made in 1995 already addressed Greek concerns.

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1) It’s crazy that we find this so special.

2) Shops have had plastic free aisles for many years, and in many places. Just not your supermarket.

3) That unfortunate photo makes it look as if everything is wrapped in plastic.

World’s First Plastic-Free Aisle Opens In Netherlands Supermarket (G.)

Shoppers in the Netherlands will get the chance to visit Europe’s first plastic-free supermarket aisle on Wednesday in what campaigners claim is an turning point in the war on plastic pollution. The store in Amsterdam will open its doors at 11am when shoppers will be able to choose from more than 700 plastic-free products, all available in one aisle. The move comes amid growing global concern about the damage plastic waste is having on oceans, habitats and food chains. Scientists warn plastic pollution is now so widespread it risks permanent contamination of the natural world. [..] Sian Sutherland, co-founder of A Plastic Planet, the group behind the campaign, said the opening represented “a landmark moment for the global fight against plastic pollution”.

“For decades shoppers have been sold the lie that we can’t live without plastic in food and drink. A plastic-free aisle dispels all that. Finally we can see a future where the public have a choice about whether to buy plastic or plastic-free. Right now we have no choice.” The aisle will open in the Amsterdam branch of the Dutch supermarket chain Ekoplaza. The company says it will roll out similar aisles in all of its 74 branches by the end of the year. Ekoplaza chief executive, Erik Does, has been working with the campaign for the past month and said the initiative was “an important stepping stone to a brighter future for food and drink”. “We know that our customers are sick to death of products laden in layer after layer of thick plastic packaging. Plastic-free aisles are a really innovative way of testing the compostable biomaterials that offer a more environmentally friendly alternative to plastic packaging.”

The aisle will have more than 700 plastic-free products including meat, rice, sauces, dairy, chocolate, cereals, yogurt, snacks, fresh fruit and vegetables. Campaigners say the products will not be anymore expensive than plastic-wrapped goods and will be “scalable and convenient”, using alternative biodegradable packing where necessary rather than ditching packaging altogether. They add the aisles will be a “testbed for innovative new compostable bio-materials as well as traditional materials such as glass, metal and cardboard.” Sutherland said: “There is absolutely no logic in wrapping something as fleeting as food in something as indestructible as plastic. Plastic food and drink packaging remains useful for a matter of days yet remains a destructive presence on the Earth for centuries afterwards.”

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Really? ‘Alarmed’? ‘Crazy’? They knew weeks ago the polar vortex was about to split. And still don’t know why that is. Keep it real.

Arctic Warming: Scientists Alarmed By ‘Crazy’ Temperature Rises (G.)

An alarming heatwave in the sunless winter Arctic is causing blizzards in Europe and forcing scientists to reconsider even their most pessimistic forecasts of climate change. Although it could yet prove to be a freak event, the primary concern is that global warming is eroding the polar vortex, the powerful winds that once insulated the frozen north. The north pole gets no sunlight until March, but an influx of warm air has pushed temperatures in Siberia up by as much as 35C above historical averages this month. Greenland has already experienced 61 hours above freezing in 2018 – more than three times as many hours as in any previous year. Seasoned observers have described what is happening as “crazy,” “weird,” and “simply shocking”.

“This is an anomaly among anomalies. It is far enough outside the historical range that it is worrying – it is a suggestion that there are further surprises in store as we continue to poke the angry beast that is our climate,” said Michael Mann, director of the Earth System Science Center at Pennsylvania State University. “The Arctic has always been regarded as a bellwether because of the vicious circle that amplify human-caused warming in that particular region. And it is sending out a clear warning.” Although most of the media headlines in recent days have focused on Europe’s unusually cold weather in a jolly tone, the concern is that this is not so much a reassuring return to winters as normal, but rather a displacement of what ought to be happening farther north.

At the world’s most northerly land weather station – Cape Morris Jesup at the northern tip of Greenland – recent temperatures have been, at times, warmer than London and Zurich, which are thousands of miles to the south. Although the recent peak of 6.1C on Sunday was not quite a record, but on the previous two occasions (2011 and 2017) the highs lasted just a few hours before returning closer to the historical average. Last week there were 10 days above freezing for at least part of the day at this weather station, just 440 miles from the north pole.


Snowstorm nears London Photo: NPAS

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