Dec 262018
 
 December 26, 2018  Posted by at 10:56 am Finance Tagged with: , , , , , , , , , , ,  2 Responses »


Caravaggio Burial of St. Lucy 1608

 

US Prepares To Hit The Wall As Reckless Trump Undoes Years Of Hard Work (G.)
Trump Urges Americans To Buy The Dip; Voices Confidence In Mnuchin, Powell (ZH)
Trump’s Frustration With Mnuchin Rising – Source (CNN)
BOJ’s Kuroda Further Waters Down Pledge To Hit Inflation Target Quickly (R.)
Japan To Resume Commercial Whaling (AFP)
Asian Stocks Slip On US Shutdown Worries, Trump’s Fresh Criticism Of Fed (MW)
Asian Stocks Retreat As US Political Tumult Adds To Growth Worry (R.)
‘We’re Not Far From Zuckerberg Getting Subpoenaed’ (Ind.)
How Can We Break The Brexit Deadlock? Ask Ancient Athens (Bridle)
Brexit Made The UK A Global Joke. Can We Rebuild Our Reputation? (Kampfner)
Arab League Set To Readmit Syria Eight Years After Expulsion (G.)
More Than 50 Australian Plant Species Face Extinction Within Decade (G.)

 

 

Can’t make it up (fast enough): I used 6 anti-Trump Guardian articles from December 23 in my article yesterday, Dumping on the Donald. But guess what: I still missed one from that day. The contents are completely empty, but they really wanted to get the headline in.

US Prepares To Hit The Wall As Reckless Trump Undoes Years Of Hard Work (G.)

The accomplishments of a US president’s first year in office can be credited to his predecessor, at least where the economy is concerned. And Donald Trump was handed the best performing economy on the planet. All the tough decisions – to refinance the banks, rescue the car companies and deflate the real-estate bubble – had been made. The stock market was tearing along, setting records almost every week. Trump gave this rising balloon extra air with $1tn of tax cuts. It was borrowed money, but no matter. The economy sailed along for another year and the stock market carried on rising. His plan was to win the midterm congressional elections and then persuade the Republican party to give him another $1tn, or as near to it as possible.

In other words, he would use another pile of borrowed cash to pump up the economy again, hoping against hope that it would not blow up before his re-election. Without control of the House of Representatives, his plans are in ruins. And that was obvious to stock and bond traders, who followed the vote in November by putting a sell sign over their maps of America. December has proved to be the worst month for shares in many decades. Oil prices have slumped and the market is expecting worse to come in the new year. The reasons for pessimism are piling up. From the Atlantic to the Pacific, US home sales are struggling, with agents reporting that there are not enough buyers and asking prices are not being met.

[..] And in recent days Trump has given markets something else to worry about – building the wall. His threat to shut down the government if Congress refuses to provide him with the money for a pan-American border fence with Mexico has spooked traders. This reckless threat was preceded by the surprise decision to pull US troops out of Syria. If Trump could make such a move without consulting important allies, then perhaps he was capable of the “long shutdown” he has promised in his tweets. With ever fewer calming voices in the White House to rein in the president’s wilder excesses, it’s understandable that the finance industry is jittery about the prospects for 2019.

Read more …

Trump likes Mnuchin. Who’s been around from the get-go. And of course both know there are hard times ahead.

Trump Urges Americans To Buy The Dip; Voices Confidence In Mnuchin, Powell (ZH)

“We have companies, the greatest in the world, and they’re doing really well,” Trump told reporters at the White House on Christmas Day. “They have record kinds of numbers. So I think it’s a tremendous opportunity to buy. Really a great opportunity to buy.” Trump’s invocation to BTFD came one day after the most violent Christmas Eve selloff on record, and the day when the S&P fell not only to its lowest level in 20 months, but also slumped into a bear market. For Trump, the stock market has served as a barometer on his administration, and while he was pointing out virtually every major uptick for the past two years, the recent plunge has infuriated him, leaving him mute on any market-related topic.

But a more important catalyst for a potential Wednesday rally came when Trump appeared to back off on his demands that the Fed stop hiking, which culminated with Trump reportedly seeking to fire Fed Chair Powell and speculation that if the market does not stop falling, Treasury Secretary Mnuchin may also be on the chopping block. Alongside urging Americans to BTFD, Trump expressed confidence in the Treasury secretary and the Federal Reserve, in an attempt to calm financial markets further roiled after a recent Bloomberg report that the president had discussed firing the central bank’s chairman over raising interest rates.

Asked about Fed Chairman Jerome Powell, Trump said the central bank is “raising interest rates too fast” but he has “confidence” that the Fed will “get it pretty soon.” Trump was also asked if he has confidence in Treasury Secretary Steven Mnuchin who sparked a market panic on Monday with his late Sunday statement in which he said he had called the CEOs of the top 6 banks to make sure bank liquidity levels are fine (prompting a frenzy of question what he knows that the rest of the market does not) and followed it up with a call with the Plunge Protection Team on Monday, which however failed to prevent one of the worst one-day routs in history . Trump’s response: “yes I do, very talented guy, very smart person.”

While answering questions from reporters at the White House after addressing U.S. armed forces members on a Christmas Day video conference call, Trump also said the Fed is hiking borrowing costs because the “economy is doing so well” – which is accurate, however it is the market that is spooked by the aggressive tightening – adding that U.S. companies are having “record kinds of numbers” and it’s a “tremendous opportunity to buy.” The remarks represented Trump’s first expression of public support for Mnuchin and Powell since Bloomberg reported last week that the president has discussed dismissing Powell who was recommended by Mnuchin. Overnight, Bloomberg also reported that the president also weighed dismissing Mnuchin, while another said that Mnuchin’s tenure may depend in part on how much markets continue to drop.

Read more …

But CNN has found an anonymous source who claims Mnuchin is on his way out. Bloomberg claimed something similar.

Is it getting through to people that nothing CNN has to say about Trump has any news value?

Trump’s Frustration With Mnuchin Rising – Source (CNN)

President Donald Trump’s frustration with Treasury Secretary Steven Mnuchin is ratcheting up further after markets suffered their worst Christmas Eve drop ever despite Mnuchin’s attempts to calm Wall Street, according to a source close to the White House. The source told CNN that Mnuchin could be in “serious jeopardy” with Trump, who regularly rages at Cabinet members he feels have made mistakes, before he cools off. Trump nevertheless vouched for Mnuchin publicly, shifting blame for the market volatility to the Federal Reserve instead. “Yes, I do,” Trump said Tuesday when asked whether he had confidence in Mnuchin. “Very talented, very smart person.”

But the source painted a different picture of Mnuchin’s standing behind the scenes. “Mnuchin is under the gun,” the source said. The Treasury secretary left Washington for a Christmas holiday in Mexico’s Cabo San Lucas as the federal government shut down over the weekend, while Trump canceled his own planned trip to his Mar-a-Lago resort in Florida and remained cooped up in the White House over the holiday, absorbing a flood of negative news about the markets. Mnuchin aides have been scrambling to find economic data to help their boss calm Trump down, but Trump was said to be unhappy with what Mnuchin was telling him, this source said. An administration source dismissed the latest round of rumors that the secretary’s continued tenure was on the line. “This is nonsense,” they said.

Read more …

Abenomics bleeds to death very slowly and even more expensively.

BOJ’s Kuroda Further Waters Down Pledge To Hit Inflation Target Quickly (R.)

Conceding it was taking longer than expected to achieve 2 percent inflation, Kuroda said global risks have “come to warrant further attention” as China’s growth slows and trade frictions hurt business sentiment. He also said the BOJ must be mindful of the rising costs of prolonged monetary easing, such as the chance years of near-zero rates could hurt financial institutions’ profits and discourage them from boosting lending. “The BOJ will proceed step by step toward achieving its price target, while taking into account in a balance manner not only the benefits of monetary easing but also its costs,” Kuroda told an annual meeting of business lobby Keidanren on Wednesday. Up till now, Kuroda has repeatedly said the BOJ will seek to achieve 2 percent inflation “at the earliest date possible.”

[..] The BOJ is caught in a bind. With inflation distant from its target, it is forced to maintain a massive stimulus despite the negative spillovers. Its dwindling policy ammunition limits the ability to ramp up stimulus to prevent another recession. The dilemma has created a rift within the BOJ with its board members disagreeing on ways to address the dangers of prolonged easing, minutes of the October rate review showed. Kuroda said the situation has changed from when the BOJ deployed a massive asset-buying program in 2013, when such a drastic action was critical to pull Japan out of stagnation. Now, the economy is in good shape but inflation remains weak and closer attention is needed to overseas risks, he said. “In complex times like now, what’s required is to persistently continue with the current powerful easing while weighing the benefits and costs of our policy in a balanced manner,” Kuroda said.

Read more …

Nobody wants whale hunts. They’re arcane and stupid. So stop buying Japanese cars and electronics. Get organized. Either boycott them completely or hold your tongue.

Japan To Resume Commercial Whaling (AFP)

Japan said Wednesday it is withdrawing from the International Whaling Commission and will resume commercial whaling next year, sparking criticism from activists and anti-whaling countries including Australia. The announcement comes after Japan failed earlier this year to convince the IWC to allow it to resume commercial whaling. Top government spokesman Yoshihide Suga said the commercial hunts would be limited to Japan’s territorial waters. “We will not hunt in the Antarctic waters or in the southern hemisphere,” he added. Tokyo has repeatedly threatened to pull out of the IWC, and has been regularly criticised for catching hundreds of whales a year for “scientific research” despite being a signatory to a moratorium on hunting the animals.

Suga said Japan would officially inform the IWC of its decision by the end of the year, which will mean the withdrawal comes into effect by June 30. Leaving the IWC means Japanese whalers will be able to resume hunting in Japanese coastal waters of minke and other whales currently protected by the IWC. But Japan will not be able to continue the so-called scientific research hunts in the Antarctic and elsewhere that it has been exceptionally allowed as an IWC member. Japan joins Iceland and Norway in openly defying the IWC’s ban on commercial whale hunting, and its decision sparked international criticism.

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I think they slip because their economies are in trouble.

Asian Stocks Slip On US Shutdown Worries, Trump’s Fresh Criticism Of Fed (MW)

Asian markets were mostly lower on Wednesday after President Donald Trump said that there was “nothing new” in efforts to end the partial government shutdown over a U.S.-Mexico border wall. Traders had no fresh leads from Wall Street, which was closed on Christmas. U.S. stocks are headed for their worst December since the Great Depression in 1931. South Korea’s Kospi, 1.3% to 2,028.01 and the Shanghai Composite Index shed 0.3% to 2,498.29. Japan’s Nikkei, which plunged 5% on Tuesday, picked up 0.9 percent to 19,327.06. Shares fell Taiwan and throughout Southeast Asia. Markets in Hong Kong and Australia were closed.

The partial shutdown of the U.S. government that started Saturday shows no signs of abating. “Nothing new. Nothing new on the shutdown. Nothing new. Except we need border security,” Trump told reporters. The White House said Trump will reject any deal that does not include any funding for a wall or a fence. The Democrats have opposed this and are offering $1.3 billion for security. The routines of 800,000 federal employees are expected to be disrupted by the shutdown, but essential services will keep running. Trump’s criticism of the U.S. central bank triggered a drop in Asian equities on Tuesday. “The only problem our economy has is the Fed,” the president said on Twitter.

“They don’t have a feel for the Market, they don’t understand necessary Trade Wars or Strong Dollars or even Democrat Shutdowns over Borders.” Trump has since said since that interest rate hikes were a “form of safety” for an economy that was doing well, while stressing that the Fed was raising rates too quickly. “The outsized moves are not reflective of the current U.S. economic landscape, but that seems to matter little so far as fear mongering continues to permeate every pocket of global capital markets,” Stephen Innes of OANDA said in a market commentary.

Read more …

Trump brings down Asian stocks. Didn’t win your Christmas lottery? You know who to blame.

Asian Stocks Retreat As US Political Tumult Adds To Growth Worry (R.)

Asian stock markets retreated again on Wednesday, extending a rout that began last week as U.S. political uncertainty exacerbated worries over slowing global economic growth. Investors were unnerved by the U.S. federal government partial shutdown and President Donald Trump’s hostile stance toward the Federal Reserve chairman. U.S. Treasury Secretary Steven Mnuchin had also raised market concerns by convening a crisis group amid the pullback in stocks. S&P 500 emini futures were last down 0.6 percent, pointing toward a lower start for Wall Street when the U.S. market reopens after Christmas Day, when many of the world’s financial markets were shut.

Markets in Britain, Germany and France will remain closed on Wednesday. MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.5 percent, brushing a two-month low. The Shanghai Composite Index lost 0.4 percent while South Korea’s KOSPI shed 1.6 percent. Japan’s Nikkei, which slumped 5 percent the previous day, had a volatile session. It swerved in and out of the red, falling more than 1 percent to a 20-month-low at one stage, before ending the day with a gain of 0.9 percent. “In addition to concerns toward the U.S. economy, the markets are now having to grapple with growing turmoil in the White House which has raised political risk ahead of the year-end,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

Read more …

The CIA and MI6 are watching.

‘We’re Not Far From Zuckerberg Getting Subpoenaed’ (Ind.)

David Carroll, an associate professor at Parsons School of Design in New York, said this week may finally have dealt Facebook its “knockout” blow. As an outspoken critic of the way Facebook uses people’s data, Prof Carroll is currently suing Cambridge Analytica under the Data Protection Act following the UK firm’s role in mining data from 87 million Facebook users for the purpose of political profiling during the 2016 US presidential elections. But the latest revelations that other tech firms were given access to people’s private messages was beyond even what he thought Facebook was capable of. “Even as someone who is deeply sceptical of Facebook, I was surprised by the latest revelations,” he told The Independent.

“I didn’t know it could be that bad in terms of scope and scale. But it all seems to fit with Zuckerberg’s master plan for global domination.” The first lawsuit against Facebook regarding the Cambridge Analytica scandal, which affected more than 87 million users, comes courtesy of the attorney general of the District of Columbia. It is unlikely to be the last, given Facebook is also currently facing probes by the US Securities and Exchange Commission, the Federal Trade Commission and the Department of Justice – and that’s just in the US. A relatively insignificant fine of £500,000 that was handed to Facebook in the UK may be dwarfed following investigations by the Irish data protection regulator, which are being seen as the first serious test of Europe’s new General Data Protection Regulation.

But with more than 2 billion users worldwide and an annual revenue of more than $40 billion in 2017, it will take more than a fine to have any significant impact on Facebook. Prof Carroll has called for Facebook CEO Mark Zuckerberg and other senior executives to be subpoenaed and thinks it might not be long before that becomes a reality. “We need to get them under oath and ask them questions they cannot dodge. It will depend on the Mueller investigation. It’s imaginable additional facts come to our knowledge to justify Zuckerberg’s subpoena and we find out how much he knew and when. We need more to justify it but we’re not that far from getting there.”

Read more …

Elect your decision makers at random. That way they can’t be bought by special interests. And that’s just one of many advantages.

James Bridle is the author of New Dark Age: Technology and the End of the Future.

How Can We Break The Brexit Deadlock? Ask Ancient Athens (Bridle)

In the central marketplace of ancient Athens, around 350BC, there stood a machine called the kleroterion. This was a six-foot-high slab of stone that had a series of slots on the front, and a long tube bored down from the top to the base. Those up for selection for the various offices of state would insert metal ID tags, called pinakia, into the slots, and a functionary would pour a bucket of coloured balls, suitably shaken, into the top of the tube. The order in which the balls emerged would determine who took which role, some for the day, some for a year.

Today the kleroterion survives, in fragments, in Athens’ Museum of the Ancient Agora, alongside other pieces of democratic technology such as the clepsydra, a water clock used to time orators’ speeches and the fragments of pottery, called ostraka, on which they scratched the names of the too-powerful politicans they wished to see banished from the city, and from which we derive the modern word “ostracism”. The method of governance embodied in the kleroterion, which dates back to the very establishment of democracy, is called sortition, meaning selection by lot, as opposed to election by vote. The Athenians believed that the principle of sortition was critical to democracy. Aristotle declared that: “It is accepted as democratic when public offices are allocated by lot; and as oligarchic when they are filled by election.”

But along the way, sortition – and the even more exciting possibility of actual banishment – has fallen out of most democracies’ toolkits. Sortition in ancient Athens had a number of important qualities. First, those eligible for selection included the entire suffrage (which, it must be noted, was at the time limited to adult male citizens). Second, it applied to much more than jury selection, which is the only form in which sortition survives in most places today, and included magistrates, legislators and the main governing councils of the city – all the important posts, in fact, bar the military. And third, and perhaps most significantly, it both embodied and enabled transparent and participatory governance: that is, anybody could come down to the agora and not merely see but understand how the machine worked – and anyone could be selected by it.

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No, your reputation’s pretty much shot.

Brexit Made The UK A Global Joke. Can We Rebuild Our Reputation? (Kampfner)

Britain is now the butt of global mirth and cringe-making sympathy. I spent most of this autumn on trips trying to link our creative industries with those of other countries. From Mexico City to Montreal, Amsterdam to Tallinn, the welcome starts with the avuncular hand on the shoulder, a sigh and a reference to “our British friends”, followed by “I hope you’re all right”. Consternation over the original referendum decision long ago gave way to bafflement over the chaos. “What on earth is Mrs May doing playing pantomime host in the House of Commons at a time like this?” someone asked me last week. “We used to think that you were serious, reliable people.” Americans and Europeans used to tune in to our parliamentary antics to wonder at the jousting.

Now they are baffled that we continue to play games at a time like this. I am constantly asked why we hark on about the second world war, as if we are stuck in time and are not proud of our achievements since. The gulf between those trying to sell the UK’s skills and modernity and the poor calibre of our political culture is hitting hard. Business groups, which had been surprisingly cowed, are now waking up to the dangers of the brain drain. It is not just young, ambitious Europeans who are moving home, apparently to our prime minister’s delight. The movement of talented Britons to other countries is steady and will grow, as the reality of Brexit sinks in. Why work in a country that regards economic self-harm as just one of those things you have to get through? Why work in a country that permits people to come rather than welcomes them?

Read more …

Putin moves silently.

Arab League Set To Readmit Syria Eight Years After Expulsion (G.)

Gulf nations are moving to readmit Syria into the Arab League, eight years after Damascus was expelled from the regional bloc over its brutal repression of peaceful protests against President Bashar al-Assad. At some point in the next year it is likely Assad will be welcomed on to a stage to once again take his place among the Arab world’s leaders, sources say. Shoulder to shoulder with the Saudi crown prince, Mohammed bin Salman, and Egypt’s latest autocrat, General Abdel Fatah al-Sisi, the moment will mark the definitive death of the Arab spring, the hopes of the region’s popular revolutions crushed by the newest generation of Middle Eastern strongmen.

Syria was thrown out of the Arab League in 2011 over its violent response to opposition dissent, a move that failed to stem the bloodshed that spiralled into civil war. Now though, a regional thaw is already under way. This week, the Sudanese president, Omar al-Bashir, became the first Arab League leader to visit Syria in eight years, a visit widely interpreted as a gesture of friendship on behalf of Saudi Arabia, which has shored up ties with Khartoum in recent years. Pro-government media outlets posted pictures of the two leaders shaking hands and grasping each other’s arms on a red carpet leading from the Russian jet that ferried Bashir to Damascus along with the hashtag “More are yet to come”.

Read more …

50 plant species? Who’s that going to impress?

More Than 50 Australian Plant Species Face Extinction Within Decade (G.)

More than 50 Australian plant species are under threat of extinction within the next decade, according to a major study of the country’s threatened flora. Just 12 of the most at-risk species were found to be listed as critically endangered under national environment laws – the Environment Protection and Biodiversity Conservation Act – and 13 had no national threatened listing at all. The scientists behind the research, published in the Australian Journal of Botany this month, say the results point to a need for re-evaluation of Australia’s national lists for threatened plants. It is the first major assessment of the status of Australia’s threatened flora in more than two decades. Plants account for about 70% of Australia’s national threatened species list, with 1,318 varieties listed as either critically endangered, endangered or vulnerable.

The research team assessed species that met criteria for either a critical or endangered listing at national or state levels to track their rate of decline. They did this by reviewing all available literature on the plants – including recovery plans, conservation advice and peer-reviewed research – and conducting interviews with 125 botanists, ecologists and land managers with expertise on particular geographic regions or species. The study examined 1,135 species, including 81 that were unearthed through the interview process as being eligible for a critically endangered or endangered listing but did not have one. It found 418 plants had continued declines in their population and a further 265 species had insufficient monitoring information available to determine their status.

The scientists concluded that 55 species were at high risk of extinction within the next 10 years, with fewer than 250 individual plants or only a single population remaining. They found just 12 of the most imperilled species were listed under the EPBC Act as critically endangered and 13 had no listing at all. They said there were also 56 species of plants currently on the critically endangered list that they assessed as having no documented declines or that were stable or even increasing.

Read more …

Dec 252018
 


Rembrandt van Rijn The Adoration of the Magi 16xx

 

I still had some things I didn’t talk about in Sunday’s Trump Derangement International, about how the European press have found out that they, like the US MSM, can get lots of viewers and readers simply by publishing negative stories about Donald Trump. The US president is an attention magnet, as long as you only write things about him designed to make him look bad.

The Guardian is only too happy to comply. They ran a whole series of articles on Sunday to do juts that: try to make Trump look bad. Note that the Guardian editorial team that okayed the articles is the same as the one that allowed the fake Assange/Manafort one, so their credibility is already shot to pieces. It’s the magic triangle of today’s media profits: spout non-stop allegations against Russia, Trump and Julian Assange, and link them when and where you can. It doesn’t matter if what you say is true or not.

 

Anyway, all the following is from the Guardian, all on December 23. First off, Adam Gabbatt in New York, who has painstakingly researched how Trump’s businesses, like Trump Tower and the Trump store, don’t appear to have sufficiently (as per him) switched from Happy Holidays to Merry Christmas. Sherlock Holmes would have been proud. A smash hit there Adam, bring out the handcuffs.

 

Trump’s ‘Merry Christmas’ Pledge Fails To Manifest

During Donald Trump’s presidential campaign he talked often about his determination to win one particular war. A war that had been raging for years, he said. Specifically: the war on Christmas. But despite Trump’s repeated claims that “people are saying Merry Christmas again” instead of the more inclusive “happy holidays”, there are several places where the Christmas greeting is absent: Trump’s own businesses.

The Trump Store, for example. Instead of a Christmas gift guide – which surely would be more in keeping with the president’s stated desire for the phrase to be used – the store offers a holiday gift guide. “Shop our Holiday Gift Guide and find the perfect present for the enthusiast on your list,” the online store urges. “Carefully curated to celebrate the most wonderful time of year with truly unique gifts found only at Trump Store. Add a bow on top with our custom gift wrapping. Happy Holiday’s!”

The use of the phrase “Happy Holiday’s” [sic] in Trump marketing would seem particularly egregious. The long-standing “War-on-Christmas” complaint from the political right is that stores use the phrase “Happy Holidays”, rather than specifically mentioning the Christian celebration. It is offered as both an example of political correctness gone mad, and as an effort to erase Christianity from the US.

It’s just, I think that if Trump had personally interfered to make sure there were Merry Christmas messages all around, you would have remarked that as president, he’s not allowed to be personally involved in his businesses. But yeah, you know, just to keep the negativity going, it works, no matter how fluffy and hollow.

 

Second, still on December 23, is Tom McCarthy for the Guardian in New York. Who talks about Robert Mueller’s phenomenal successes. Mueller charged 34 people so far. In a case that involves “this complexity which has international implications, aspects relying on the intelligence community, complicated cyber components”. It really says that.

And yes, that’s how many people view this. What do they care that Mueller’s original mandate was to prove collusion between the Trump campaign and ‘Russians’, and that he has not proven any collusion at all so far, not even with 34 people charged? What do they care? It looks like Trump is guilty of something, anything, after all, and that’s all the circus wants.

 

Robert Mueller Has Enjoyed A Year Of Successes … 2019 Could Be Even Stronger

One measure of special counsel Robert Mueller’s prosecutorial success in 2018 is the list of former top Donald Trump aides brought to justice: Michael Cohen pleaded guilty, a jury convicted Paul Manafort, a judge berated Michael Flynn. Another measure is the tally of new defendants that Mueller’s team charged (34), the number of new guilty pleas he netted (five) and the amount of money he clawed back through tax fraud cases ($48m).

Yet another measure might judge Mueller’s pace compared with previous independent prosecutors. “I would refer to it as a lightning pace,” said Barb McQuade, a University of Michigan law professor and former US attorney. “In a case of this complexity which has international implications, aspects relying on the intelligence community, complicated cyber components – to indict that many people that quickly is really impressive work.”

But there’s perhaps a more powerful way to measure Mueller’s progress in his investigation into Russian interference in the 2016 US election and links between Moscow and the Trump campaign; that’s by noticing how the targets of his investigation have changed their postures over the course of 2018, from defiance to docility – or in the case of Trump himself, from defiance to extreme, hyperventilating defiance.

In reality, you would be at least as correct if you would claim that Robert Mueller’s investigation has been an abject failure. Not one iota of collusion has been proven after 20 months and $20 million in funds have been used. And any serious investigation of Washington’s culture of fixers and lobbyists would land at least 34 people who have committed acts that border on or over illegality. And in a matter of weeks, for a few hundred bucks.

 

Third, still on December 23, is Julian Borger in Washington, who’s been elected to convey the image of chaos. Trump Unleashed, says our modern day Shakespeare. With Jim Mad Dog Mattis characterized as “.. the last independently minded, globally respected, major figure left in the administration”... Again, it really says that.

Because woe the man who tries to bring US troops home, or even promises to do so a few days before Christmas. For pulling out America’s finest, Donald Trump is being portrayed as something eerily close to the antichrist. That truly is the world on its head. Bringing troops home to their families equals chaos.

Look, guys, if Trump has been guilty of criminal behavior, the US justice system should be able to find that out and convict him for it. But that’s not what this is about anymore. A million articles have been written, like these ones in the Guardian, with the sole intention, evidence being scarce to non-existent, of smearing him to the extent that people see every subsequent article in the light of a man having previously been smeared.

 

Chaos At Home, Fear Abroad: Trump Unleashed Puts Western World On Edge

The US stumbled into the holiday season with a sense of unravelling, as a large chunk of the federal government ground to a halt, the stock market crashed and the last independently minded, globally respected, major figure left in the administration announced he could no longer work with the president. The defense secretary, James Mattis, handed in his resignation on Thursday, over Donald Trump’s abrupt decision to pull US troops out of Syria.

On Saturday another senior official joined the White House exodus. Brett McGurk, the special envoy for the global coalition to defeat Isis and the US official closest to America’s Kurdish allies in the region, was reported to have handed in his resignation on Friday. That night, senators flew back to Washington from as far away as Hawaii for emergency talks aimed at finding a compromise on Trump’s demand for nearly $6bn for a wall on the southern border, a campaign promise which has become an obsession.

Now look at the next headline, December 23, Graeme Wearden, Guardian, and ask yourself if it’s really Trump saying he doesn’t agree with the rate hikes that fuels the fears, or whether it’s the hikes themselves. And also ask yourself: when Trump and Mnuchin both deny reports of Trump firing Powell, why do journalists keep saying the opposite? Because they want to fuel some fears?

From where I’m sitting, it looks perfectly logical that Trump says he doesn’t think Powell’s decisions are good for the US economy. And it doesn’t matter which one of the two turns out to be right: Trump isn’t the only person who disagrees with the Fed hikes.

The main suspect for 2019 market turmoil is the inevitable fallout from the Fed’s QE under Bernanke and Yellen. And there is something to be said for Powell trying to normalize rates, but there’s no doubt that may hasten, if not cause, turmoil. Blaming it on Trump not agreeing with Jay Powell is pretty much as left field as it gets.

 

White House Attacks On Fed Chair Fuel Fears Of Market Turmoil In 2019

Over the weekend, a flurry of reports claimed Donald Trump had discussed the possibility of firing the Federal Reserve chairman, Jerome Powell. Such an unprecedented move would trigger further instability in the markets, which have already had their worst year since the 2008 crisis. US officials scrambled to deny Trump had suggested ousting Powell, who was appointed by the president barely a year ago.

The Treasury secretary, Steven Mnuchin, tweeted that he had spoken to the president, who insisted he “never suggested firing” Powell, and did not believe he had the right to do this. However, Trump also declared – via Mnuchin – that he “totally disagrees” with the Fed’s “absolutely terrible” policy of raising interest rates and unwinding its bond-buying stimulus programme, piling further pressure on the US’s independent central bank.

And now, in the only article in the Guardian series that’s December 24, not 23, by Victoria Bekiempis and agencies, the plunging numbers in the stock markets are Trump’s fault, too.

 

Trump ‘Plunging Us Into Chaos’, Democrats Say, As Markets Tank And Shutdown Persists

Top Democrats have accused Donald Trump of “plunging the country into chaos” as top officials met to discuss a growing rout in stock markets caused in part by the president’s persistent attacks on the Federal Reserve and a government shutdown. “It’s Christmas Eve and President Trump is plunging the country into chaos,” the two top Democrats in Congress, House speaker nominee Nancy Pelosi and Senate minority leader Chuck Schumer, wrote in a joint statement on Monday. “The stock market is tanking and the president is waging a personal war on the Federal Reserve – after he just fired the Secretary of Defense.”

Trump criticized the Federal Reserve on Monday, describing it as the “only problem” for the US economy, even as top officials convened the “plunge protection team” forged after the 1987 crash to discuss the growing rout in stock markets. The crisis call on Monday between US financial regulators and the US treasury department failed to assure markets, and stocks fell again amid concern about slowing economic growth, the continuing government shutdown, and reports that Trump had discussed firing Federal Reserve chairman Jerome Powell.

The last one is from one Jonathan Jones, again December 23, again for the Guardian. And it takes the top award in the narrative building contest.

Again, the Guardian editorial team that okayed this article is still the same as the one that allowed the fake Assange/Manafort one, an editorial team that sees no problem in making things up in order to smear people. To portray Trump, Assange and anyone who’s had the misfortune of being born in Russia as suspicious if not outright criminal.

But look at what Jones has to say, and what Guardian editor-in-chief Kathy Viner and her ilk allowed and pressured him to say. He wants to have a say in how Trump should dress (seasonal knitwear), he evokes the image of Nazi architect Albert Speer for no reason at all, and then it’s a matter of mere inches until you arrive at Trump as a king, an emperor, an inner tyrant.

“He’s in a tuxedo!”, Like that’s a bad thing for Christmas. “She’s in white!”. Oh dear, call the pope. If both Trumps would have put on Christmas sweaters in front of a fire, the writer would have found something negative in that.

 

Trump Portrait: You Couldn’t Create A Creepier Yuletide Scene If You Tried

The absence of intimacy in the Trumps’ official Christmas portrait freezes the heart. Can it be that hard to create a cosy image of the presidential couple, perhaps in front of a roaring hearth, maybe in seasonal knitwear? Or is this quasi-dictatorial image exactly what the president wants to project? Look on my Christmas trees, ye mighty, and despair! If so, it fuels suspicions that it is only the checks and balances of a 230-year-old constitution that are keeping America from the darkest of political fates. You couldn’t create a creepier Yuletide scene if you tried. Multiple Christmas trees are currently a status symbol for the wealthy, but this picture shows the risks.

Instead of a homely symbol of midwinter cheer, these disciplined arboreal ranks with their uniform decorations are arrayed like massed soldiers or colossal columns designed by Albert Speer. The setting is the Cross Hall in the White House and, while the incumbent president cannot be held responsible for its architecture, why heighten its severity with such rigid, heartless seasonal trappings? Everything here communicates cold, empty magnificence. Tree lights that are as frigid as icicles are mirrored in a cold polished floor. Equally frosty illuminations are projected on the ceiling. Instead of twinkling fairy magic, this lifeless lighting creates a sterile, inhuman atmosphere.

You can’t imagine kids playing among these trees or any conceivable fun being had by anyone. It suggests the micromanaged, corporate Christmas of a Citizen Kane who has long since lost touch with the ordinary, warm pleasures of real life. In the centre of this disturbing piece of conceptual art stand Donald and Melania Trump. He’s in a tuxedo, she’s wearing white – and not a woolly hat in sight. Their formal smartness adds to the emotional numbness of the scene. Trump’s shark-like grin has nothing generous or friendly about it. He seems to want to show off his beautiful wife and his fantastic home rather than any of the cuddly holiday spirit a conventional politician might strive to share at this time.

It begs a question: how can a man who so glaringly lacks anything like a common touch be such a successful “populist”? What can a midwestern voter find in this image to connect with? Perhaps that’s the point. After more than two centuries of democracy, Trump is offering the US people a king, or emperor. In this picture, he gives full vent to his inner tyrant. If this portrait contains any truth about the state of America and the world, may Santa help us all.

I realize that you may be tired of the whole story. I realize you may have been caught in the anti-Trump narrative. And I am by no means a Trump fan. But I will keep on dragging you back to this. Because the discussion should not be based on a handful of media moguls not liking Trump. It should not be based on innuendo and smear. If Trump is to be convicted, it must be on evidence.

And there is no such evidence. Robert Mueller has charged 34 people, but none with what his mandate was based on, none with Russia collusion. This means that the American political system, and democracy itself, is under severe threat by the very media that are supposed to be its gate keepers.

 

None of this is about Trump, or about whether you like him or not, or even if he’s a shady character or not. Instead, it’s about the influence the media have on how our opinions and ideas about people and events are being shaped on a daily basis.

And once you acknowledge that your opinions of Trump, Putin et al, even without any proof of a connection between them, are actively being molded by the press you expect to inform you about the truth behind what goes on, you will have to acknowledge, too, that you are a captive of forces that use your gullibility to make a profit off you.

If our media need to make up things all the time about who’s guilty of what, because our justice systems are incapable of that, then we have a problem so enormous we may not be able to overcome it in our present settings.

Alternatively, if we trust our justice systems to deliver true justice, we don’t need a hundred articles a day to tell us how Trump or Putin are such terrible threats to our world. Our judges will tell us, not our journalists or media who are only in it for a profit.

I can say: “let’s start off 2019 trying to leave prejudice behind”, and as much as that is needed and you may agree with me, it’s no use if you don’t realize to what extent your views of the world have been shaped by prejudice.

I see people reacting to the star writer at Der Spiegel who wrote a lot about Trump, being exposed as a fraud. I also see people trying to defend Julian Assange from the Guardian article about his alleged meetings with Paul Manafort, that was an obvious big fat lie (the truth is Manafort talked to Ecuador to help them ‘sell’ Assange to the US).

But reacting to the very obvious stuff is not enough. The echo chamber distorts the truth about Trump every single day, and at least six times on Sunday, as this essay of mine shows. It’s just that after two years of this going on 24/7, it is perceived as the normal.

Everyone makes money dumping on the Donald, it’s a proven success formula, so why would the Guardian and Der Spiegel stay behind? They’d only hurt their own bottom line.

It has nothing to do with journalism, though, or news. It’s smear and dirt, the business model of the National Enquirer. That’s how far our once truthful media have fallen.

 

 

Dec 232018
 
 December 23, 2018  Posted by at 10:24 am Finance Tagged with: , , , , , , , , , , , ,  9 Responses »


Caravaggio Adoration of the Shepherds 1609

 

Krakatau-Triggered Tsunami Kills At Least 168 In Indonesia (R.)
David Collum’s 2018 Year In Review: “The Year Everything Changed”
Corbyn Faces Furious Labour Backlash Over Backing Brexit (G.)
UK To Tackle Loneliness Crisis With £11.5m Cash Injection (G.)
If Truth Cannot Prevail Over Material Agendas We Are Doomed (PCR)
Mnuchin Refutes Report That Trump Wants Powell Fired (MW)
Trump’s Political Viagra (Jatras)
We Know How Trump’s War Game Ends (Taibbi)
Send the Mad Dog to the Corporate Kennel (McGovern)
Is China Getting Too Close To Israel? (ATimes)

 

 

Krakatau in 1883 is the stuff of legend. It affected climate all over the world.

“When the Krakatoa volcano in Indonesia erupted in 1883, the resulting debris caused vibrant red sunsets around the world for up to three years afterward.”

It also killed 30,000+. But it was still much weaker than Tambora in 1811, also Indonesia, which killed over 70,000.

Krakatau-Triggered Tsunami Kills At Least 168 In Indonesia (R.)

A tsunami killed at least 168 people and injured hundreds on the Indonesian islands of Java and Sumatra following an underwater landslide believed caused by the erupting Anak Krakatau volcano, officials and media said on Sunday. Hundreds of homes and other buildings were “heavily damaged” when the tsunami struck along the rim of the Sunda Strait late on Saturday, Sutopo Purwo Nugroho, spokesman for the disaster mitigation agency, said. Thousands of residents were forced to evacuate to higher ground. There was no estimate on the number of missing. TV images showed the seconds when the tsunami hit the beach and residential areas in Pandeglang on Java island, dragging with it victims, debris, and large chunks of wood and metal.

The eruption of Krakatau in 1883 killed more than 36,000 people in a series of tsunamis. Anak Krakatau is the island that emerged from the area once occupied by Krakatau, which was destroyed in 1883. It first appeared in 1927 and has been growing ever since. Saturday’s tsunami was the latest in a series of tragedies that have struck Indonesia, a vast archipelago, this year. Successive earthquakes flattened parts of the tourist island of Lombok, and a double quake-and-tsunami killed thousands on Sulawesi island. Nearly 200 people died when a Lion Air passenger plane crashed into the Java Sea in October.

Authorities warned residents and tourists in coastal areas around the Sunda Strait to stay away from beaches and a high-tide warning remained in place through till Dec. 25. “Those who have evacuated, please do not return yet,” said Rahmat Triyono, an official at the Meteorology, Climatology and Geophysics Agency (BMKG). President Joko Widodo, who is running for re-election in April, said on Twitter that he had “ordered all relevant government agencies to immediately take emergency response steps, find victims and care for the injured”.

Read more …

Dave Collum still produces his endless end of the year reviews, and he’s still a good friend and avid reader of the Automatic Earth. Even though Twitter sort of shadow banned him from my feed.

David Collum’s 2018 Year In Review: “The Year Everything Changed”

Sources I sit in front of a computer 16 hours a day gerrymandering my brain, at least three of which are dedicated to non-chemistry pursuits. I’m a huge fan of Adam Taggart and Chris Martenson (Peak Prosperity), Tony Greer (TG Macro), Doug Noland (Credit Bubble Bulletin), The Automatic Earth, Grant Williams (Real Vision and Things That Make You Go Hmmm), Raoul Pal (Real Vision), Bill Fleckenstein (Fleckenstein Capital), Mike Krieger (Liberty Blitzkrieg), Demetri Kofinas (Hidden Forces), James Grant (Grant’s Interest Rate Observer), Campus Reform, and any nonsense spewed by Twitter legend @RudyHavenstein.

There are so many others, many of whom I consider friends that I am simply waiting to meet. ZeroHedge is by far my preferred consolidator of news; it’s an acquired taste and requires a filter, but I think those rogues are great. Twitter is a window to the world if managed correctly—especially for a chemist attempting to connect with the finance world. Warning: the Holy Grail of maximizing follower counts is an illusion; it produces a counterproductive hyperconnectivity that makes extracting signal from noise difficult. So much flow, so little time.

Read more …

The half of British who don’t want Brexit have no-one to speak for them. That is a volatile situation. And potentially explosive.

Corbyn Faces Furious Labour Backlash Over Backing Brexit (G.)

Jeremy Corbyn is facing a storm of criticism from Labour activists and MPs after suggesting he would press ahead with Brexit if the party won a snap general election. In a sign that he is losing backing among overwhelmingly pro-Remain Labour supporters, Corbyn was also accused of betraying the party membership by appearing reluctant to back the idea of supporting Remain in a second referendum. The first signs of a serious internal revolt from party members on the left, who helped propel him to the leadership, came after Corbyn gave an interview to the Guardian in which he suggested he thought Brexit should go ahead and said EU state-aid rules would prevent a Labour government intervening to support UK industries.

His anti-EU tone drew immediate criticism from party supporters and members who had successfully persuaded the leadership to back the possibility of a second referendum at Labour’s annual conference in Liverpool in September. Richard Brooks, a Labour member, activist and co-founder of For our Future’s Sake (FFS), a pro-Remain youth and student-led organisation, said Corbyn risked losing the backing of young people as well as the mass Labour membership he had promised to empower. “Jeremy Corbyn is in danger of betraying and losing the support of millions of young people and students who very nearly propelled him to Downing Street last year, and whose support he needs if he is to ever to become prime minister.

“Students and young people will not forget or forgive politicians who sell them down the river by backing a Brexit that limits our life opportunities and makes us poorer,” he said.

Read more …

Because there’s nothing that cannot be bought.

UK To Tackle Loneliness Crisis With £11.5m Cash Injection (G.)

A coffee caravan in rural Suffolk, furniture restoration projects for men and organised rambles for the recently bereaved are among more than a hundred initiatives being backed with a £11.5m fund to tackle Britain’s epidemic of loneliness. One hundred and twenty-six projects have been chosen to receive up to £100,000 each in the first ever government-backed fund to tackle a problem that the prime minister, Theresa May, described as “incredibly damaging to our humanity” when she launched a national loneliness strategy in October. The projects will target a wide range of groups from isolated Pakistani women in Bradford to young LGBTQ+ in Bristol and lonely elderly men in Cornwall.

The government believes the health impact of loneliness is on a par with obesity and smoking. It says loneliness is associated with a greater risk of smoking, coronary heart disease and stroke as well as an increased risk of depression, low self-esteem, sleep problems and Alzheimer’s disease. Mims Davies, the minister for loneliness, said: “I am committed to encouraging open conversations around this sensitive topic to reduce the stigma and create an environment where everyone is better connected.”

Rural Coffee Caravan in Suffolk will buy a new camper van that will travel to quiet villages in the East Anglian countryside and set up temporary cafes. It is also using the money to extend an initiative that involves pubs giving out free coffee on Monday mornings. “Loneliness is just so damaging,” said Ann Osborn, its director. “Lonely people are more likely to have problems with obesity, have heart disease and suffer from depression. But also they cut themselves off and so the community suffers.

Read more …

Well, truth is gone from the media already…

If Truth Cannot Prevail Over Material Agendas We Are Doomed (PCR)

Throughout the long Cold War Stephen Cohen, professor of Russian studies at Princeton University and New York University was a voice of reason. He refused to allow his patriotism to blind him to Washington’s contribution to the confict and to criticize only the Soviet contribution. Cohen’s interest was not to blame the enemy but to work toward a mutual understanding that would remove the threat of nuclear war. Although a Democrat and left-leaning, Cohen would have been at home in the Reagan administration, as Reagan’s first priority was to end the Cold War. I know this because I was part of the effort. Pat Buchanan will tell you the same thing.

[..] Today Cohen is stressed that it is the United States that thinks it can win a nuclear war. Washington speaks openly of using “low yield” nuclear weapons, and intentionally forecloses any peace negotiations with Russia with a propaganda campaign against Russia of demonization, villification, and transparant lies, while installing missile bases on Russia’s borders and while talking of incorporating former parts of Russia into NATO. In his just published book, War With Russia?, which I highly recommend, Cohen makes a convincing case that Washington is asking for war.

I agree with Cohen that if Russia is a threat it is only because the US is threatening Russia. The stupidity of the policy toward Russia is creating a Russian threat. Putin keeps emphasizing this. To paraphrase Putin: “You are making Russia a threat by declaring us to be one, by discarding facts and substituting orchestrated opinions that your propagandistic media establish as fact via endless repetition.” Cohen is correct that during the Cold War every US president worked to defuse tensions, especially Republican ones. Since the Clinton regime every US president has worked to create tensions. What explains this dangerous change in approach?

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One little rumor can last an entire Christmas season.

Mnuchin Refutes Report That Trump Wants Powell Fired (MW)

President Donald Trump, reportedly angry over the U.S. central bank’s decision to raise interest rates last week, has talked about ousting Federal Reserve Chairman Jerome Powell, according to Bloomberg News. The report, based on “four people familiar with the matter,” said they were not convinced Trump would move against Powell, but that the president’s ire remained elevated over rising interest rates. Rates are climbing at the same time that the stock market has wiped out 2018 gains. In a Saturday evening tweet, Treasury Secretary Steven Mnuchin said he has spoken with the president and Trump said, “I totally disagree with Fed policy. I think the increasing of interest rates and the shrinking of the Fed portfolio is an absolute terrible thing to do at this time especially in light of my major trade negotiations which are ongoing, but I never suggested firing Chairman Jay Powell, nor do I believe I have the right to do so.”

On Friday, Trump’s economic team split publicly over the Fed. Trump’s trade adviser Peter Navarro told a Japanese newspaper that “we” — presumably meaning the White House — didn’t want to see any more interest-rate hikes from the central bank. The Fed has penciled in two rate hikes for 2019. Navarro said that would be “two too many.” “We don’t understand why the Fed is acting so contractionary at a time when there’s no inflation to worry about,” he said. White House chief economist Kevin Hassett said he disagreed with Navarro. “That’s Peter speaking for himself,” Hassett insisted. “I think the appropriate position for an economist in the White House is to respect the independence of the Fed and not comment on their policies,” Hassett said.

Read more …

Is Trump finally getting the chutzpah to implement his promises?

Trump’s Political Viagra (Jatras)

After two years of getting rolled by the Washington establishment, it seems that President Donald Trump woke up and suddenly realized, “Hey – I’m the president! I have the legal authority to do stuff!” • He has announced his order to withdraw US troops from Syria. • His Defense Secretary James Mattis has resigned. There are rumors National Security Adviser John Bolton may go too. (Please take Secretary of State Mike Pompeo with you!) • He announced a start to withdrawing from Afghanistan. • He now says he will veto a government funding bill unless he gets $5 billion for his Wall, and as of 12:01 AM Washington time December 22 the federal government is officially under partial shutdown.

All of this should be taken with a big grain of salt. While this week’s assertiveness perhaps provides further proof that Trump’s impulses are right, it doesn’t mean he can implement them. The Syria withdrawal will be difficult. The entire establishment, including the otherwise pro-Trump talking heads on Fox News, are dead set against him – except for Tucker Carlson and Laura Ingraham. Senator Lindsey Graham is demanding hearings on how to block the Syria pullout. Congress hardly ever quibbles with a president’s putting troops into a country, where the Legislative Branch has legitimate Constitutional power. But if a president under his absolute command authority wants to pull them out – even someplace where they’re deployed illegally, as in Syria – well hold on just a minute!

We are being told our getting out of Syria and Afghanistan will be a huge “gift” to Russia and Iran. Worse, it is being compared to Barack Obama’s “premature” withdrawal from Iraq (falsely pointed to as the cause of the rise of ISIS) and will set the stage for “chaos.” By that standard, we can never leave anywhere. This will be a critical time for the Trump presidency. (And if God is really on his side, he soon might get another Supreme Court pick.) If he can get the machinery of the Executive Branch to implement his decision to withdraw from Syria, and if he can pick a replacement to General Mattis who actually agrees with Trump’s views, we might start getting the America First policy Trump ran on in 2016.

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Wait, we do? Matt sounds a bit confused here.

We Know How Trump’s War Game Ends (Taibbi)

So we’re withdrawing troops from the Middle East. GOOD! What’s the War on Terror death count by now, a half-million? How much have we spent, $5 trillion? Five-and-a-half? For that cost, we’ve destabilized the region to the point of abject chaos, inspired millions of Muslims to hate us, and torn up the Geneva Convention and half the Constitution in pursuit of policies like torture, kidnapping, assassination-by-robot and warrantless detention. It will be difficult for each of us to even begin to part with our share of honor in those achievements. This must be why all those talking heads on TV are going crazy.

Unless Donald Trump decides to reverse his decision to begin withdrawals from Syria and Afghanistan, cable news for the next few weeks is going to be one long Scanners marathon of exploding heads. “Today’s decision would cheer Moscow, ISIS, and Iran!” yelped Nicole Wallace, former George W. Bush communications director. “Maybe Trump will bring Republicans and Democrats together,” said Bill Kristol, on MSNBC, that “liberal” channel that somehow seems to be populated round the clock by ex-neocons and Pentagon dropouts. Kristol, who has rarely ever been in the ballpark of right about anything — he once told us Iraq was going to be a “two month war” — might actually be correct.

Trump’s decisions on Syria and Afghanistan will lay bare the real distinctions in American politics. Political power in this country is not divided between right and left, and not even between rich and poor. The real line is between a war party, and everyone else. This is why Kristol is probably right. The Democrats’ plan until now was probably to impeach Trump in the House using at minimum some material from the Michael Cohen case involving campaign-finance violations.

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“Like all members of the military profession I never had an original thought until I left the service. My mental faculties remained in suspended animation..”

Send the Mad Dog to the Corporate Kennel (McGovern)

Outgoing Defense Secretary Gen. James “Mad Dog” Mattis was famous for quipping, “It’s fun to shoot some people.” It remains a supreme irony that Mattis was widely considered the only “adult in the room” in the Trump administration. Compared to whom? John Bolton, the rabid neocon serving as national security adviser? That would be the epitome of “condemning with faint praise.” [..] Mattis was simply incapable of acknowledging the self-destructive, mindless nature of U.S. “endless war” in the Middle East, which candidate-Trump had correctly called “stupid.” In his resignation letter, Mattis also peddled the usual cant about the indispensable nation’s aggression being good for the world.

Mattis was an obstacle to Trump’s desire to pull troops out of Syria and Afghanistan (and remains in position to spike Trump’s orders). Granted, the abrupt way Trump announced his apparently one-man decision was equally stupid. But withdrawal of ground troops is supremely sane, and Mattis was and is a large problem. And, for good or ill, Trump — not Mattis — was elected president. Historically, Marines are the last place to turn for sound advice. Marine Gen. Smedley Butler (1881-1940), twice winner of the Medal of Honor, was brutally candid about this, after he paused long enough to realize, and write, “War is a Racket”: “I suspected I was just part of a racket at the time. Now I am sure of it. Like all members of the military profession I never had an original thought until I left the service. My mental faculties remained in suspended animation while I obeyed the orders of the higher- ups. …”

Read more …

Next up are ports in Chesapeake Bay?

Is China Getting Too Close To Israel? (ATimes)

China is constructing seaports at two sites where the US 6th Fleet deploys, in Haifa next to Israel’s main naval base and Ashdod near Tel Aviv, prompting concerns about China’s military potential in the Mediterranean Sea and Middle East. “The civilian [Chinese] port in Haifa abuts the exit route from the adjacent [Israeli] navy base, where the Israeli submarine fleet is stationed and which, according to foreign media reports, maintains a second-strike capability to launch nuclear missiles,” Israel’s Haaretz media reported. “No one in Israel thought about the strategic ramifications,” Haaretz said in September. The guided-missile destroyer USS Arleigh Burke visited Haifa on October 25 in support of the 6th Fleet which is headquartered in Naples, Italy.

Shanghai International Port Group (SIPG) signed the Haifa contract in 2015, began construction in June, and is to operate the Bayport Terminal for 25 years starting from 2021. SIPG signed memorandums of understanding with U.S. ports in Seattle, Washington in 2006 and Georgia Ports Authority in 2004, plus Barcelona, Spain, in 2006. SIPG also works with European ports in Rotterdam, Hamburg and London, and two ports in Japan, its website said. China Harbor Engineering, one of China’s biggest government-owned enterprises, is meanwhile constructing a port at Ashdod, 25 miles (40 kilometers) south of Tel Aviv.

“At $3 billion, this is one of the biggest overseas investment projects in Israel, ever, and also one of the biggest for the Chinese company, China Harbor Engineering,” wrote Arthur Herman, senior fellow at the Washington-based Hudson Institute think tank in November. “Ashdod on the Mediterranean coast is the destination of fully 90 percent of Israel’s international maritime traffic,” Herman said.

Read more …

Dec 212018
 
 December 21, 2018  Posted by at 10:42 am Finance Tagged with: , , , , , , , , , , , , , , ,  12 Responses »


Pieter Bruegel the Elder Hunters in the snow 1565

 

Dow Drops 470 Points To 14-Month Low In Day 2 Of Big Losses After Fed Hike (CNBC)
As Fear Rises On Wall Street, Strategists Warn The Worst Is Yet To Come (CNBC)
US Defense Chief Mattis Quits As Trump Pulls From Syria, Afghanistan (AFP)
House Passes Spending Bill With Border Wall Money, Senate Showdown Next (CNBC)
China Denies ‘Slanderous’ Economic Espionage Charges From US Allies (R.)
Russian Media Regulator Starts Checking Legality Of BBC’s Operations (R.)
Gatwick Runway Reopens After Days Of Drone Disruption (G.)
There’s A National Emergency All Right – But It Isn’t Brexit (G.)
Germany’s Hidden Crisis – Social Decline In The Heart Of Europe (G.)
Malaysia Seeks $7.5 Billion In Reparations From Goldman Sachs Over 1MDB (R.)
Singapore Said To Expand 1MDB Criminal Probe To Include Goldman Sachs (BBG)
Carlos Ghosn Re-Arrested On New Charges In Japan (BBC)
New Tree Species Became Extinct Before It Was Named (Ind.)

 

 

Jay Powell pricks the bubbles. Painful and inevitable. But if he ever decides to lower rates again next year, look for the bubbles to return. That’s his dilemma.

Dow Drops 470 Points To 14-Month Low In Day 2 Of Big Losses After Fed Hike (CNBC)

U.S. stocks swooned for a second day Thursday after the Federal Reserve raised benchmark interest rates and said that it would continue to let its massive balance sheet shrink at the current pace. Fears of a government shutdown also sent stocks tumbling to new lows Thursday afternoon. The Dow Jones Industrial Average fell 464.06 points to 22,859.6, bringing its two-day declines to more than 800 points and its 5-day losses to more than 1,700 points. The S&P 500 fell 1.5 percent to finish at 2,467.41 as technology stocks underperformed. The Nasdaq Composite fell 1.6 percent and closed at 6,528.41, briefly dipping into bear market territory amid big losses in Amazon and Apple.

The Nasdaq is 19.7 percent below its recent high. Companies in the S&P 500 have lost a total of $2.39 trillion in market cap this month. The Cboe Volatility Index — one of the market’s best gauges of marketplace fear — rose above 30. The Dow and Nasdaq posted their lowest closes since October 2017, while the S&P 500 finished at its lowest level since September 2017. The Dow and S&P 500, which are both in corrections, are on track for their worst December performance since the Great Depression in 1931, down more than 10 percent each this month. The S&P 500 is now in the red for 2018 by 7.7 percent.

Read more …

Yeah, all these experts. Who cares? There’s not nearly enough fear yet.

As Fear Rises On Wall Street, Strategists Warn The Worst Is Yet To Come (CNBC)

“The market’s in no man’s land,” said Peter Boockvar, chief investment strategist at Bleakley Advisory Group. Stocks have broken through the lows of the year, and technicians are scurrying to find the next support levels. On the S&P 500, he said 2,400 is a potential psychological area of support. The market plunged Thursday against the backdrop of a congressional feud with the White House over a continuing budget resolution, but the markets were more focused on the worries that have been festering over global growth and the potential for recession. “You can guarantee if the government shuts down it’s going to very soon reopen,” said Boockvar.

“This could be a carry through from yesterday, that’s legitimate. The problem now is this is the first time in years in this bull market that people are doing tax-loss selling. That’s helping to exaggerate the move. You’re also having redemptions.” Since the Fed announced its rate hike Wednesday, the Dow was down 815 points. The sharp drop in stocks since early October was unexpected and even more crushing recently, since December is typically a positive time for stocks. The 10 percent decline so far in the S&P 500 is its worst December performance since 1931. If it remains this way, it would the first time ever that December is the worst month of the year for the index.

Read more …

Have all those people who now say Mattis is the wisest and most balanced in the White House, forgotten why he’s called Mad Dog?

US Defense Chief Mattis Quits As Trump Pulls From Syria, Afghanistan (AFP)

US Defense Secretary Jim Mattis resigned Thursday, leading a chorus of protests at home and abroad after President Donald Trump ordered a complete troop pullout from Syria and a significant withdrawal from Afghanistan. Trump steadfastly defended his sudden push for retrenchment, vowing that the United States would no longer be the “policeman of the Middle East” and saying the 2,000-strong US force in Syria was no longer needed as the Islamic State group had been defeated. Mattis, a battle-hardened retired four-star general seen as a moderating force on the often impulsive president, made little attempt to hide his disagreements with Trump.

“Because you have the right to have a secretary of defense whose views are better aligned with yours,” Mattis said in a letter to Trump, “I believe it is right for me to step down from my position.” Mattis hailed the coalition to defeat Islamic State as well as NATO, the nearly 70-year-old alliance between North America and Europe whose cost-effectiveness has been questioned by the businessman turned president. “My views on treating allies with respect and also being clear-eyed about both malign actors and strategic competitors are strongly held and informed by over four decades of immersion in these issues,” Mattis wrote. One day after the surprise announcement on Syria, a US official told AFP that Trump had also decided on a “significant withdrawal” in a much larger US operation – Afghanistan.

Read more …

No government into Christmas?

House Passes Spending Bill With Border Wall Money, Senate Showdown Next (CNBC)

The House passed a temporary spending bill Thursday with money for President Donald Trump’s proposed border wall, further muddying the scramble to dodge a partial government shutdown by Friday. The chamber approved the measure to keep the government running into February by a 217-185 vote. But the path forward now is murky. The bill likely will not clear the Senate because it includes more than $5 billion for the border barrier, increasing the chances that funding for seven agencies lapses after the midnight Friday deadline. Senators were told Thursday to prepare for potential votes Friday. The chamber convenes at noon. The Senate unanimously approved a bill Wednesday night to keep the government running through Feb. 8 — without border wall money.

Trump insisted Thursday that he would not sign it. It forced House Republicans to include the wall money in the new bill. Both House Minority Leader Nancy Pelosi and Senate Minority Leader Chuck Schumer have flatly said congressional Democrats will not approve wall money. As Republicans need Democratic votes to pass spending legislation in the Senate, a partial shutdown is all but assured if the GOP insists on funding for the barrier. It is unclear if Republicans will abandon that goal in an effort to keep the government running past Friday. During a televised Oval Office fracas last week, Pelosi challenged Trump by saying he did not have the votes for wall money in the House. It turns out he did.

Read more …

We can do it, but they can’t.

China Denies ‘Slanderous’ Economic Espionage Charges From US Allies (R.)

China’s Foreign Ministry said on Friday it resolutely opposed “slanderous” accusations from the United States and other allies criticizing China for economic espionage, urging Washington to withdraw its accusations. The United States should also withdraw charges against two Chinese citizens, the ministry said, adding that China had never participated in or supported any stealing of commercial secrets and had lodged “stern representations” with Washington. “We urge the U.S. side to immediately correct its erroneous actions and cease its slanderous smears relating to internet security,” it said, adding that it would take necessary measures to safeguard its own cybersecurity and interests.

It has long been an “open secret” that U.S. government agencies have hacked into and listening in on foreign governments, companies and individuals, the ministry added. “The U.S. side making unwarranted criticisms of China in the name of so-called ‘cyber stealing’ is blaming others while oneself is to be blamed, and is self-deception. China absolutely cannot accept this.” U.S. prosecutors indicted two Chinese nationals linked to China’s Ministry of State Security intelligence agency on charges of stealing confidential data from American government agencies and businesses around the world. Prosecutors charged Zhu Hua and Zhang Shilong in hacking attacks against the U.S. Navy, the space agency NASA and the Energy Department and dozens of companies. The operation targeted intellectual property and corporate secrets to give Chinese companies an unfair competitive advantage, they said.

Read more …

More of the same: We can do it, but they can’t. The west wants to blame RT for all sorts of stuff beacuse that fits the Russophobe narrative.

Russian Media Regulator Starts Checking Legality Of BBC’s Operations (R.)

Russia’s media regulator said on Friday it would carry out checks to determine if the BBC World News channel and BBC internet sites complied with Russian law, a move it described as a response to British pressure on a Russian TV channel. Roskomnadzor, the regulator, said in a statement its checks were Russia’s response to a decision by British media regulator Ofcom, which on Thursday said that Russian broadcaster RT had broken impartiality rules in some of its news and current affairs programs. “The results of our check will be announced separately,” the Russian regulator said. Ofcom said on Thursday it was considering imposing some kind of sanction on RT, which is financed by the Russian state.

It took issue in particular with its coverage of the poisoning in Britain of former Russian spy Sergei Skripal and his daughter. Britain has accused agents working for Russia’s military intelligence agency, the GRU, of committing the crime, an allegation Moscow denies. British Media Secretary Jeremy Wright also weighed in on Thursday, saying what he called RT’s mask as an impartial news provider was slipping. RT rejected Ofcom’s findings, saying Ofcom had ignored its explanations and not paid “due regard” to its rights. Commenting on the launch of the Russian investigation on Friday, Margarita Simonyan, RT’s editor-in-chief, said on Twitter that Ofcom had hinted that it planned to strip her channel of its broadcasting license in Britain. “(Welcome to the) brave new world,” she wrote.

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Days of panic due to one or two drones, at an airport that has just one runway to begin with?!

Gatwick Runway Reopens After Days Of Drone Disruption (G.)

The first flights have resumed at Gatwick airport after a series of drone sightings caused days of disruption, affecting more than 100,000 passengers. Airlines warned customers to continue to check their flight’s status on Friday morning as the airport worked to “introduce a limited number of flights over the coming hours”. The runway had remained closed throughout Thursday night, forcing passengers to search for accommodation or shelter at the airport, and bringing demands for new aviation regulations to tackle the threat. The airport’s chief operating officer, Chris Woodroofe, said 120,000 passengers’ flights had been disrupted by the incident.

On Thursday night police said there had been more than 50 sightings of the drone in 24 hours from when the runway was first closed. Night-flight restrictions had been lifted at other airports, so “more planes could get into and out of the country”, the transport secretary, Chris Grayling said. “This is clearly a very serious ongoing incident in which substantial drones have been used to bring about the temporary closure of a major international airport,” he said. “The people who were involved should face the maximum possible custodial sentence for the damage they have done. The government is doing everything it can to support Sussex police.”

Shooting down the drone was being considered as a “tactical option” after other strategies to stop it had failed. Amid disbelief that the drone incident could be enough to bring one of the UK’s key airports to a standstill, the perpetrator or perpetrators eluded a search conducted by 20 units from two police forces in the surrounding area.

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Britain just stumbles from crisis to crisis, hidden from view by discussions about someone saying Stupid Woman.

There’s A National Emergency All Right – But It Isn’t Brexit (G.)

[..] there is a world beyond Brexit. True, it lacks the frenzied drama of cabinet walkouts, prime ministerial straw-clutching or humiliation served cold in Brussels. But things still happen – it’s just that they haven’t won much attention. It has been a good month to bury bad news. So allow me to disinter some of the headlines deep inside the newspapers. Since we’re counting small things, let’s start with children. Last week it was reported that a primary school in Great Yarmouth had opened its own food bank. It was launched by the headteacher, Debbie Whiting, after she saw pupils under 11 so hungry they were stealing from others’ lunchboxes.

This week, more than half of teachers surveyed by the National Education Union expressed fears that some of their kids won’t have enough to eat this Christmas. They reported a boy turning up wearing his trousers back to front, in order to hide the holes in the knees, and a class where one in three children sleep in their uniforms because they have no pyjamas. If anything qualifies as a national emergency, it should be this. A new generation growing up without adequate food and clothing ought to be leading TV bulletins and shaming government ministers into action. What dominates instead is blue-on-blue match commentary, because Jacob Rees-Mogg is box office while poor people can be slipped in just before the “And finally”.

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“..of all German women in work only one in three earns the minimum wage…”

Germany’s Hidden Crisis – Social Decline In The Heart Of Europe (G.)

The cover of Oliver Nachtwey’s book depicts a VW Beetle, emblem of Teutonic manufacturing prowess since Hitler’s day, driving off a cliff. Is the country that got used to imposing its values on feebler client nations – bailing out southern Europeans with their oversized public sectors, rampant tax avoidance and long lunches – in trouble? The Germany described by this Frankfurt School professor is a basket case – post-growth, post-democratic, with the first fascists in the Bundestag since the Third Reich. Despite being Europe’s richest country, it has higher numbers of working poor than any other EU state; almost one in four of its workers is paid less than the €9.30 (£8.40) minimum wage, many requiring state support.

Sociologist Ulrich Beck in the giddy 1980s called Germany an elevator society, in which millions of skilled workers upgraded from VWs to Audis and expected their children to rise still further in social status and wealth. The elevator may have seized up for a while after reunification, but only five years ago Germany seemed unstoppable. Every German, Beck thought, was in the same lift. No longer. Not only has downward mobility become more evident but the poor get poorer, the rich get richer, the older get tenure, the younger join the precariat. Sure, greater equality of opportunity means more women work than ever before, but of all German women in work only one in three earns the minimum wage.

“So while German women are more equal in terms of rights, inequality between women has never been greater than it is today,” Nachtwey argues. This is symptomatic of what he calls regressive modernisation and of the following paradox: “The more a society is based on equality of opportunity, the more unequal it becomes, and the more legitimate its inequalities”. Legitimate? The losers are perceived to be those who deserve to lose, the winners those who deserve to win. And the losers are the usual suspects – women, immigrants, those who have no qualifications. A Germany that once prided itself on social mobility, and whose sociologists once crazily imagined class distinctions were over, has become, in terms of class, as sclerotic as Britain.

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There’s a class action case looming as well.

Malaysia Seeks $7.5 Billion In Reparations From Goldman Sachs Over 1MDB (R.)

Malaysia is seeking US$7.5 billion in reparations from Goldman Sachs over its dealings with scandal-linked state fund 1MDB, the Financial Times reported on Friday (Dec 21), citing the country’s finance minister. Malaysian prosecutors this week filed charges against Goldman Sachs in connection with its role as underwriter and arranger of three bond sales that raised US$6.5 billion for 1Malaysia Development Berhad (1MDB), the first criminal action against the US bank over the scandal. Goldman Sachs has consistently denied wrongdoing and said certain members of the former Malaysian government and 1MDB lied to the bank about the proceeds of the bond sales.

In addition to the bonds’ total value, Goldman Sachs should also return US$1 billion to cover US$600 million in fees paid to the bank and bond coupons that were “higher than the market rate”, the FT quoted Malaysian finance minister Lim Guan Eng as saying. The three 10-year bonds carried coupons ranging from 4.4 per cent to 5.99 per cent. Lim also told the FT that reparations should at least be more than US$1.8 billion, the sum Goldman Sachs has told investors it had set aside to cover potential losses related to 1MDB legal proceedings. “Their figure is US$1.8 billion. Ours is US$7.5 billion,” Lim said. Goldman Sachs told the FT: “The 1MDB bond offerings were meant to raise money to benefit Malaysia; instead, a huge portion of those funds were stolen for the benefit of members of the Malaysian government and their associates.”

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The squid screwed up royally. But no-one at Goldman will be arrested.

Singapore Said To Expand 1MDB Criminal Probe To Include Goldman Sachs (BBG)

Singapore has expanded a criminal probe into fund flows linked to scandal-plagued 1MDB to include Goldman Sachs, which helped raise money for the entity, people with knowledge of the matter said. Police in the city-state had been examining Goldman’s relationship with the Malaysian state investment company since at least late 2017, but until recently, the firm’s local unit itself wasn’t a focus of any investigation, said the people, asking not to be named discussing sensitive information.

Authorities are trying to determine whether some of the roughly $600 million in fees from the three bond deals Goldman arranged for 1MDB from 2012 to 2013 flowed to the Singapore subsidiary, they said. Singapore’s widened probe opens a potential new battle front for Goldman, less than a week after Malaysia filed the first criminal charges against the firm over a relationship that spawned one of the biggest scandals in its history. Singapore is coordinating closely with the U.S. Justice Department, which is also investigating Goldman and has filed criminal charges against two former senior bankers at the firm, the people said.

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He’s been at it for a while: “..prosecutors now accuse Mr Ghosn of shifting a private investment loss of over $16m onto Nissan in the wake of the 2008 financial crisis.”

Carlos Ghosn Re-Arrested On New Charges In Japan (BBC)

Former Nissan chairman Carlos Ghosn has been re-arrested on fresh charges, Japanese media report, dashing any hopes he could be released on bail. Mr Ghosn has spent the last month in prison, accused of misusing funds and hiding $80m of income. But on Thursday a court rejected a request by the prosecution to extend his detention, which meant he could apply to be released on bail. Friday’s arrest is on a new charge of aggravated breach of trust. According to Japanese broadcaster NHK, prosecutors now accuse Mr Ghosn of shifting a private investment loss of over $16m onto Nissan in the wake of the 2008 financial crisis.

A towering and revered figure in the auto industry, Mr Ghosn has not yet responded to the latest allegation – but he has consistently denied all prior accusations made against him. He was first arrested in Tokyo in November as allegations of financial misconduct surfaced. The BBC’s Mariko Oi says that ever since Carlos Ghosn stepped off his private jet only to be taken into police custody, the case has gripped Japan with speculation rife over what could be behind such a stunning fall from grace. The case has been highly unusual – not least for a high profile chief executive to be spending time in jail – but also because of its legal twists such as yesterday’s when the court rejected an application to extend his detention..

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Animal species are much easier to worry over. Maybe that’s not all that smart.

“..at least six other studies failed to turn up any sign that the tree still exists. Tens of thousands of plant species globally face similar risks.”

New Tree Species Became Extinct Before It Was Named (Ind.)

Scientists have identified a new species of tree that is thought to have become extinct before it was even named. The tree, which has now been called Vepris bali, is believed to have been unique to a forest reserve in west Africa, but forest clearing and agricultural development have wiped it out. Scientists are studying the vepris species for the antimicrobial and antimalarial properties of their essential oils. Researchers hope several other vepris trees will be identified and named in Cameroon before they also disappear. A specimen was collected by a forester, Edwin Ujor, in the Bali Ngemba Forest Reserve in Cameroon in 1951.

The specimen was thought to belong to the genus vepris, which has 80 species, mostly found across Africa. But the tree has not been seen anywhere since. Researchers from the Royal Botanic Gardens, Kew, and the country’s University of Yaoundé I examined the original specimens and used molecular phylogenetic studies to identify the new species. They say the tree is now either critically endangered or already extinct.

Repeated efforts to find the species between 2000 and 2004 and at least six other studies failed to turn up any sign that the tree still exists. Tens of thousands of plant species globally face similar risks. According to the International Plant Names Index, only about 5 per cent of all known species have ever been formally assessed for their extinction risk. The authors wrote: “This makes it a priority to discover, document and protect such species before they become globally extinct.” The Bali Ngemba Forest Reserve, an officially protected forest, is part of the Bamenda highlands, an area so denuded of its natural forest vegetation that it is now known in Cameroon as “the grasslands”.

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Dec 202018
 


Giovanni Bellini Madonna and Child with St. John the Baptist and Female Saint 1500-04

 

It’s 100 days to Brexit (Ind.)
Powell Breaks The Market (ZH)
A Major Technical Breakdown Just Occurred In Stocks (Colombo)
Peter Schiff : Not A Bear Market But ‘A House Of Cards The Fed Built’ (MW)
Asian Shares Battered After Fed Raises Rates For Fourth Time (G.)
Short-Term Funding Bill Announced To Stop Trump’s Government Shutdown (Ind.)
Trump Plans Full Withdrawal Of US Troops From Syria (AFP)
Don’t Hold Your Breath on US Troop Withdrawal from Syria (CN)
US Occupation of Middle East Doesn’t Suppress Terrorism, It Causes It (Murray)
Big Pharma Returning To US Price Hikes In January After Pause (R.)
Italy Avoids EU Sanctions After Reaching 2019 Budget Agreement (G.)
French Police Threaten To Join Protesters (NW)
London’s Gatwick Airport Shut Down After Drones Spotted Overhead (AP)
Der Spiegel Says Top Journalist Faked Stories For Years (G.)
Finless Porpoise, China’s Smiling Angel, Fights To Survive (AFP)

 

 

Yes it is. And so of course the UK talked about one thing only. Did Corbyn call Theresa May a ‘stupid woman’ or did he say ‘stupid people’ about a group of Tories, as a whole contingent of lipreaders claimed?

They sure know what’s important, and what not.

It’s 100 days to Brexit (Ind.)

The vote of the House of Commons on the Brexit deal will now be in the week beginning 14 January, the prime minister confirmed on Monday. She hopes that her MPs are slowly coming round to the deal as the least worst option. She may also hope that Jeremy Corbyn gives his MPs a free vote, in which case enough of them may vote for her deal as a way of avoiding another referendum. It still seems more likely that Theresa May will lose, in which case the Brexit timetable will slip further. She would probably then ask the Commons to vote again after it had rejected the other options.

The one that is easiest to eliminate would be that of leaving the EU without a deal, even if it were dressed up as a “managed no deal” – at least, it ought to be easy to eliminate this option, but, until all the hoops have been jumped through, a no-deal Brexit remains the default, which is why there was such a fuss about no-deal planning at yesterday’s cabinet. The more difficult course for parliament to rule out is that of postponing Brexit and holding a referendum. If Corbyn backs a final say referendum, a Commons vote could be close, but, if May can defeat that option, she could then ask MPs to vote again on her deal. That seems to be her plan: to wear parliament down. That way she might finally win the vote at a second attempt a week later, in the week beginning 21 January – or even after that.

By then, the country would be running out of time to complete Brexit by 29 March. The problem is that a vote to approve the deal, important though it is, is only one of the things that need to be done to take us out of the EU. Once the deal has been approved, parliament also has to pass legislation to give effect to the withdrawal agreement in UK law. This will be called the EU (Withdrawal Agreement) Bill – yet another bill that sounds similar to all the others. It will be a complex and contentious bill that will be tricky to get through a hung parliament. In particular, it will contain a mechanism to entrench parts of the withdrawal agreement in UK law and make it hard for future parliaments to change them.

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Well, not really. Powell and his predecessors built such a huge zombie that it can’t be called a market. So he’s not breaking a market but a zombie, and how exactly can that be a bad thing?

Powell Breaks The Market (ZH)

“Everything was awesome” and then Jay Powell said… Some years ago, we took away the lesson that the markets were very sensitive to news about the balance sheet, so we thought carefully about how to normalize it and thought to have it on automatic pilot, and use rates to adjust to incoming data. That has been a good decision, I think, I don’t see us changing that…. we don’t see balance sheet runoff as creating problems” And everything broke…

Overnight futures show hopeful buying – “surely The Fed will deliver and capitulate… for goodness sake, someone has to rescue my FANG portfolio!!??” – But The Fed did not – cutting their rate outlook by a mere one hike, with plenty still seeing 3 hikes ahead in 2019…

The market now expects 18bps of RATE CUTS in 2020!!!

And Futures collapsed…

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Same here with my buddie Jesse: comparing what happens with today’s zombie, with functioning markets of the past, is dangerous and of limited value.

A Major Technical Breakdown Just Occurred In Stocks (Colombo)

The much-anticipated December Fed meeting has finally come and gone, and the stock market did not like what it heard. The Fed raised rates by 0.25% and cut its expectation for 2019 rate hikes from three to two. Because the Fed didn’t sound as dovish as many investors would have liked, the S&P 500 promptly fell 1.54% to a fresh 2018 low. From a technical perspective, today’s action is extremely concerning because the S&P 500 broke the key 2,550 to 2,600 support zone that I’ve been showing for the past couple months. Today’s breakdown increases the probability of further bearish action unless the index somehow manages to close back above that zone.

The longer-term S&P 500 chart shows how critical today’s breakdown is. Today’s breakdown is the second important technical breakdown in recent months (the first one being the break below the trendline that formed in early-2016, which I said was a bad omen). Assuming today’s breakdown remains intact, 2,100 (the 2015 and 2016 highs) is the next price target and support level to watch.

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Peter Schiff appears to agree with me, only he calls it a house of cards, not a zombie.

Peter Schiff : Not A Bear Market But ‘A House Of Cards The Fed Built’ (MW)

Where in the world is Peter Schiff, as the stock market entered an apparent unraveling phase? Find the chief executive of Euro Pacific Capital, a longtime gold bug and market pundit, on a beach in Puerto Rico, where he’s taken up residence as he watches the equity market get rocked. “I’m watching the U.S. economy implode from the beach,” Schiff told MarketWatch during a recent phone interview. “We’re in a lot of trouble,” he said. “This isn’t a bear market, we’re in a house of cards that the Fed built,” he said. Indeed, despite recent attempts to rebound, the Dow Jones is on track for its worst year since 2008 — down by about 3.5% — when the financial crisis brought global markets to their knees, according to Dow Jones Market Data.

The same goes for the S&P 500 which would also notch its worst year in a decade, if its roughly 4% decline thus far this year hold. Schiff is a polarizing figure on Wall Street, a man that critics say has harbored a persistent and unrealized post-crisis narrative for the Fed’s monetary policy, with predictions of soaring inflation and a dollar collapse. However, the prominent investor should be worthy of investors’ attention, on the back of his prescient calls ahead of the 2008 financial crisis, which earned him plaudits as one of the few able to spot a global economic crisis emanating from the housing market.

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“The Fed’s been a huge friend of the stock market and they are now a little bit of an enemy and will probably become worse of an enemy..”

Asian Shares Battered After Fed Raises Rates For Fourth Time (G.)

Asian stock markets have taken a battering after the US Federal Reserve voted to raise borrowing costs for the fourth time this year, signalling a further squeeze on liquidity around the world. In Tokyo, the Nikkei closed down nearly 3% to its lowest point for 14 months as the Fed’s pledge to continue with “gradual” rate hikes next year sent shivers through financial markets. Shares in Hong Kong and Seoul were both down more than 1% while stocks in Sydney finished at a two-year low. Futures trading pointed to a drop of 2% in the FTSE100 index in London and the Dax in Frankfurt when when the markets open on Thursday morning.

Investors’ confidence that the global economy is headed for a significant slowdown was further weakened when China’s central bank introduced a new lending facility for small private businesses, which was seen as a targeted rate cut designed to kickstart the spluttering economy. The move by the People’s Bank of China shows the two biggest economies are out of step with Beijing responding to a rate hike in the US with a de facto cut. The Shanghai Composite share index was down nearly 1% in afternoon trade while the yuan wad fixed 0.22% lower against the US dollar. [..] “The Fed’s been a huge friend of the stock market and they are now a little bit of an enemy and will probably become worse of an enemy before this is all over,” Bob Doll, Nuveen chief equity strategist and senior portfolio manager, told Bloomberg.

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McConnell saves the day…

Short-Term Funding Bill Announced To Stop Trump’s Government Shutdown (Ind.)

Senate Majority Leader Mitch McConnell has introduced a short-term spending bill to finance the US government and avoid a shutdown at the end of the week Mr McConnell, the leading Republican in the Senate, said that the funding bill known as a continuing resolution “will ensure continuous funding for the federal government” until 8 February. The short-term bill needs to be approved by both the Senate and the House of Representatives before it can proceed to President Donald Trump’s desk to be signed into law. Mr McConnell’s bill comes as Congress races against time before funding for the government runs out on Friday at midnight, amid a contentious push by Mr Trump to make $5bn worth in funding for his controversial border wall a requirement for any spending agreement.

But, while Mr Trump had indicated that he would take responsibility for a shutdown in order to make a point about the wall, the White House has since stepped back from that threat. We have other ways that we can get to that $5 billion”, White House Press Secretary Sarah Huckabee Sanders said on Tuesday. On the Senate floor, Mr McConnell lashed out at Democrats, who will reclaim their House majority in January, for failing to give Mr Trump any of the $5bn he has asked for. “This seems to be the reality of our political moment,” Mr McConnell said. “It seems like political spite for the president may be winning out over sensible policy.”

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We’re going to see endless and contradictory ‘analyses’ of this. It’s already drawn out the likes of Lindsey Graham and Mario Rubio and exposed them as deep state soldiers.

Trump Plans Full Withdrawal Of US Troops From Syria (AFP)

The United States will withdraw its troops from Syria, a US official told AFP on Wednesday, after President Donald Trump said America has “defeated ISIS” in the war-ravaged country. The stunning move will have extraordinary geopolitical ramifications and throws into question the fate of US-backed Kurdish fighters who have been tackling Islamic State jihadists. “We have defeated ISIS in Syria, my only reason for being there during the Trump Presidency,” the Republican president tweeted. The US official told AFP that Trump’s decision was finalized Tuesday. “Full withdrawal, all means all,” the official said when asked if the troops would be pulled from all of Syria.

Currently, about 2,000 US forces are in Syria, most of them on a train-and-advise mission to support local forces fighting IS. The official would not provide a timeline for a withdrawal, saying only: “We will ensure force protection is adequately maintained, but as quickly as possible.” Echoing Trump, White House spokeswoman Sarah Sanders said IS has been defeated territorially, noting the US-led coalition that includes dozens of nations would continue fighting IS. “These victories over ISIS in Syria do not signal the end of the Global Coalition or its campaign,” Sanders said in a statement. “We have started returning United States troops home as we transition to the next phase of this campaign.”

[..] Republican Senator Lindsey Graham, a Trump ally, said the president’s decision was shortsighted. “President @realDonaldTrump is right to want to contain Iranian expansion,” Graham said on Twitter. “However, withdrawal of our forces in Syria mightily undercuts that effort and put our allies, the Kurds at risk.” Charles Lister, a senior fellow at the Middle East Institute, called the decision “extraordinarily short-sighted and naive.” “This move will look like a ‘withdrawal,’ not a ‘victory,’ and yet more evidence of the dangerous unpredictability of the US president,” Lister said. “This is not just a dream scenario for ISIS, but also for Russia, Iran and the Assad regime, all of whom stand to benefit substantially from a US withdrawal.”

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It is quite possible that the deep state will eventually swallow Trump’s announcement whole. However, if he had gone through the usual channels to make his announcement, they would have caught it before it became public. That’s why he has Twitter.

Don’t Hold Your Breath on US Troop Withdrawal from Syria (CN)

The announcement on Wednesday that the U.S. will withdraw all remaining troops from Syria within the next month looked at first like a rare victory for Donald Trump in his admittedly erratic opposition to senseless wars of adventure. “We have defeated ISIS in Syria, my only reason for being there,” the president tweeted with an unmistakable air of triumph. Don’t get your hopes up. Just about everything in these initial reports is either wrong or misleading. One, the U.S. did not defeat the Islamic State: The Syrian Arab Army, aided by Russia, Iran, and Hezbollah militias did. Two, hardly was ISIS the only reason the U.S. has maintained a presence in Syria. The intent for years was to support a coup against the Assad government in Damascus—in part by training and equipping jihadists often allied with ISIS.

For at least the past six months, the U.S. military’s intent in Syria has been to counter Iranian influence. Last and hardly least, the U.S. is not closing down its military presence in Syria. It is digging in for an indefinite period, making Raqqa the equivalent of the Green Zone in Baghdad. By the official count, there are 503 U.S. troops stationed in the Islamic State’s former capital. Unofficially, according to The Washington Post and other press reports, the figure is closer to 4,000—twice the number that is supposed to represent a “full withdrawal” from Syrian soil. It would be nice to think Washington has at last accepted defeat in Syria, given it is preposterous to pretend otherwise any longer.

Damascus is now well into its consolidation phase. Russia, Iran, and Turkey are currently working with Staffan de Mistura, the UN’s special envoy for Syria, to form a committee in January to begin drafting a new Syrian constitution. It would also be nice to think the president and commander-in-chief has the final say in his administration’s policies overseas, given the constitution by which we are supposed to be governed. But the misleading announcement on the withdrawal of troops, followed by Trump’s boastful tweet, suggest something close to exactly the opposite. As Trump finishes his second year in office, the pattern is plain: This president can have all the foreign policy ideas he wants, but the Pentagon, State, the intelligence apparatus, and the rest of what some call “the deep state” will either reverse, delay, or never implement any policy not to its liking.

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The Grand Coalition includes the media.

US Occupation of Middle East Doesn’t Suppress Terrorism, It Causes It (Murray)

Even the neo-con warmongers’ house journal The Guardian, furious at Trump’s attempts to pull US troops out of Syria, in producing a map to illustrate its point, could only produce one single, uncertain, very short pen stroke to describe the minute strip of territory it claims ISIS still control on the Iraqi border. Of course, the Guardian produces the argument that continued US military presence is necessary to ensure that ISIS does not spring back to life in Syria. The fallacy of that argument can be easily demonstrated. In Afghanistan, the USA has managed to drag out the long process of humiliating defeat in war even further than it did in Vietnam.

It is plain as a pikestaff that the presence of US occupation troops is itself the best recruiting sergeant for resistance. In Sikunder Burnes I trace how the battle lines of tribal alliances there today are precisely the same ones the British faced in 1841. We just attach labels like Taliban to hide the fact that invaders face national resistance. The secret to ending the strength of ISIS in Syria is not the continued presence of American troops. It is for America’s ever closer allies in Saudi Arabia and the Gulf to cut off the major artery of money and arms, which we should never forget in origin and for a long time had a strong US component. The US/Saudi/Israeli alliance against Iran is the most important geo-political factor in the region today.

It is high time this alliance stopped both funding ISIS and pretending to fight it; schizophrenia is not a foreign policy stance. There has been no significant Shia Islamic terrorist or other threat against the West in recent years. 9/11 was carried out by Saudi Sunni militants. Al Qaida, ISIS, Al Nusra, Boko Haram, these are all Sunni groups, and all Saudi sponsored. It is a matter of lunacy that the West has adopted the posture that it is Iran – which has sponsored not one attack on the West in recent memory – which is the threat in the Middle East.

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Trump will have to act, or risk looking like a fool.

Big Pharma Returning To US Price Hikes In January After Pause (R.)

Novartis and Bayer are among nearly 30 drugmakers that have taken steps to raise the U.S. prices of their medicines in January, ending a self-declared halt to increases made by a pharma industry under pressure from the Trump administration, according to documents seen by Reuters.The hikes will pose a new challenge to President Donald Trump’s pledge to lower the costs of prescription medications in the world’s most expensive pharmaceutical market. The U.S. Department of Health and Human Services (HHS) has proposed a slew of policies aimed at lowering prices and passing more of the discounts negotiated by health insurers on to patients.

Those measures are not expected to provide relief to consumers in the short-term, however, and fall short of giving government health agencies direct authority to negotiate or regulate drug prices. 28 drugmakers filed notifications with California agencies in early November disclosing that they planned to raise prices in 60 days or longer. Under a state law passed last year, companies are required to notify payers in California if they intend to raise the U.S. list price on any drug by more than 16 percent over a two-year period. [..] “Requests and public shaming haven’t worked” to lower drug prices, said Michael Rea, chief executive of RX Savings Solutions, which helps health plans and employers seek lower cost prescription medicines. “We expect the number of 2019 increases to be even greater than in past years.”

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I think Salvini will get away with presenting this as a victory. But I may be wrong. How far removed is it from what Tsipras pulled in summer 2015? And how much is it like Macron and the yellow vests?

Italy Avoids EU Sanctions After Reaching 2019 Budget Agreement (G.)

Italy has managed to avert EU sanctions after reaching a compromise with the European commission over its 2019 budget. The Italian prime minister, Giuseppe Conte, said the government had managed to reach an agreement to reduce the deficit target to 2.04% of GDP from 2.4%. This has been achieved without making drastic changes to key budget proposals such as the promise of a universal basic income and lowering the pension age. “Over the last few weeks we worked to bring the positions closer without ever moving backwards with respect to the objectives the Italian people set us in the 4 March election,” Conte said.

“The economic-financial estimates about the measures that attracted the most attention of our European partners revealed that the resources [needed] were less than forecast.” The yield, or effective interest rate, on Italian 10-year government bonds fell to 2.79%, the lowest level since September. Less than two months ago the yield, the price the Italian government has to pay to borrow, rose to 3.8%. However, Valdis Dombrovskis, a European commission vice-president, described the agreement with Italy as a “borderline compromise” that fails to provide long-term solutions to the country’s economic problems. “But it enables us, for now, to avoid opening a debt procedure, as long as the negotiated measures are fully applied,” he said at a press conference in Brussels.

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Hilarious: “Police have accumulated some 23 million hours of overtime that is yet to be paid.”

French Police Threaten To Join Protesters (NW)

The French government is desperately trying to keep its exhausted police force onside following weeks of violent protests demanding economic reforms, improved living standards and the resignation of President Emmanuel Macron. On Wednesday, French officials met with police trade union leaders to work out a deal to soothe anger in law enforcement ranks regarding overwork, unpaid overtime and difficult working conditions, Le Monde reported. But some activists are calling on police to walk out on government negotiations, close down police stations and join the “gilets jaunes”—or yellow vest—protesters with whom they have been facing off since November 17. Negotiations between three unions—Alliance, UNSA-Police and Unity-SGP-FO—and Interior Minister Christophe Castaner on Tuesday failed to reach a settlement.

As talks resumed on Wednesday, France 24 reported that activists were calling on forces across the country to commit to a “slowdown” and only respond to emergencies until the dispute had been settled. Police have accumulated some 23 million hours of overtime that is yet to be paid. According to The Local France, police union leader Frédéric Lagache explained, “Faced with this irresponsibility [of the government], we are forced to be irresponsible in our actions.” The Alliance and Unity-SGP-FO unions called for a “black day for the police” on Wednesday. The Alliance is using Twitter and Facebook to rally support for what it calls “Act 1” of the police protests, using the name given to the ongoing demonstrations held by the gilets jaunes. The group has also threatened to hold “Act II” and “Act III” if required.

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I’m thinking one word here: copycats. Too easy not to try at home.

London’s Gatwick Airport Shut Down After Drones Spotted Overhead (AP)

London’s Gatwick Airport shut down late Wednesday while officials urgently investigated reports that two drones were flying above the airfield. The airport suspended all flights, causing severe disruptions just days before Christmas during one of the heaviest travel times of the year. Police and aviation authorities were still investigating early Thursday as incoming flights were diverted to other locations in Britain and nearby countries. Passengers complained on Twitter that their flights had landed at London Heathrow, Manchester, Birmingham and other cities. Other flights were sent to France and the Netherlands. One traveler whose flight was diverted tweeted that passengers were not being told when they could continue to their destination.

Gatwick advised travelers via Twitter to check flights scheduled for Thursday before heading to the airport. It also advised anyone planning to pick up arriving passengers to check first. Any problem at Gatwick causes a ripple effect throughout Britain and continental Europe, particularly during a holiday period when the air traffic control system is under strain. It is a busy airport 27 miles south of London, hosting a variety of short- and long-haul flights and serving as a major hub for the budget carrier easyJet. Gatwick normally operates throughout the night but the number of flights is restricted because of noise limitations. The airport website says it usually handles 18 to 20 flights overnight during the winter months.

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Yes, it’s priceless to read the Guardian on fake news.

Craig Murray tweets: ..The Guardian today published a story about a German journalist who invented stories, but still has never apologised for its own 100% fabricated Luke Harding piece about Manafort’s “visits to Assange in the Embassy”, and Harding and Viner are still employed..

Der Spiegel Says Top Journalist Faked Stories For Years (G.)

The German news magazine Der Spiegel has been plunged into chaos after revealing that one of its top reporters had falsified stories over several years. The media world was stunned by the revelations that the award-winning journalist Claas Relotius had, according to the weekly, “made up stories and invented protagonists” in at least 14 out of 60 articles that appeared in its print and online editions, warning that other outlets could also be affected. Relotius, 33, resigned after admitting to the scam. He had written for the magazine for seven years and won numerous awards for his investigative journalism, including CNN Journalist of the Year in 2014.

Earlier this month, he won Germany’s Reporterpreis (Reporter of the Year) for his story about a young Syrian boy, which the jurors praised for its “lightness, poetry and relevance”. It has since emerged that all the sources for his reportage were at best hazy, and much of what he wrote was made up. The falsification came to light after a colleague who worked with him on a story along the US-Mexican border raised suspicions about some of the details in Relotius’s reporting, having harboured doubts about him for some time.

The colleague, Juan Moreno, eventually tracked down two alleged sources quoted extensively by Relotius in the article, which was published in November. Both said they had never met Relotius. Relotius had also lied about seeing a hand-painted sign that read “Mexicans keep out”, a subsequent investigation found. Other fraudulent stories included one about a Yemeni prisoner in Guantanamo Bay, and one about the American football star Colin Kaepernick.

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Sometimes I think that if all my friends are leaving, why would I stay behind?

Finless Porpoise, China’s Smiling Angel, Fights To Survive (AFP)

In an oxbow lake along the middle reaches of the Yangtze River, a breathy sigh pierces the surface stillness as one of China’s most endangered animals comes up for a gulp of hazy air. A slick black back with no dorsal fin arches briefly above the water line before plunging back down. Such glimpses of the shy Yangtze finless porpoise, the only aquatic mammal left in China’s longest river and known in Chinese as the “smiling angel” for its perma-grin, are increasingly rare. Pollution, overfishing, hydroelectric dams and shipping traffic have rendered them critically endangered, worse off even than China’s best-known symbol of animal conservation, the panda.


AFP Photo/Johannes EISELE

China’s government estimates there were 1,012 wild Yangtze finless porpoises in 2017, compared to more than 1,800 giant pandas, which is no longer endangered. But researchers see signs of hope. Porpoise numbers fell by nearly half from 2006-2012 to an estimated 1,040. But the rate of decline has slowed markedly since then, suggesting that conservation may be making a dent. A central component of the rescue effort is the introduction of porpoises to several conservation areas off the busy river, where researchers say numbers have been actually increasing. [..] Chinese officials are keen to avoid a repeat of the “baiji”, or Yangtze dolphin, the river’s only other aquatic mammal, which since 2006 has been considered extinct in a huge conservation setback for China. Losing the “smiling angel” would be a further tragedy, conservationists say.

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Dec 192018
 
 December 19, 2018  Posted by at 10:01 am Finance Tagged with: , , , , , , , , , , ,  7 Responses »


Francisco Goya Fire at night 1793-94

 

Fed Expected To Move Forward With Rate Hike, Despite Trump (CNBC)
Has “BTFD” Become “STFR”? (Roberts)
Oil Slump Could Get Much Worse Amid Oversupply Concerns (CNBC)
Alan Greenspan Has A New Warning For Investors: ‘Run For Cover’ (CNBC)
Revenge Of The Spies: Flynn Case Shows Extent Of Anti-Trump #Resistance (Malic)
This Radical Plan to Fund the ‘Green New Deal’ Just Might Work (Ellen Brown)
Thousands Of British Troops On Standby For No-Deal Brexit (Ind.)
New ‘Integrity Initiative’ Leaks: Military Ties, Infiltration of European Media (RT)
Either The EU Ditches Neoliberalism Or Its People Will Ditch The EU (Wight)
Belgian PM Charles Michel Resigns After No-Confidence Motion (G.)
France, Hungary, Serbia: Is Half Of Europe Protesting? (DW)
Hungary’s Opposition Plans More Protests After ‘Slave Law’ Passes (G.)
One of Earth’s Largest Living Things Even Bigger Than Previously Thought (Ind.)

 

 

As long as Powell hints that hikes will be slower, the ‘markets’ will cheer.

Fed Expected To Move Forward With Rate Hike, Despite Trump (CNBC)

The Federal Reserve is expected to raise interest rates by a quarter point Wednesday and also signal it will not be raising rates as much as it had previously forecast. Strategists say that may soothe volatile financial markets, but the Fed has a tough task in terms of explaining its actions in a way that will not sound too alarmist about the economy or too unconcerned about deteriorating financial conditions. The Fed will be taking the fed funds rate range to 2.25 to 2.50 percent, and Fed watchers expect it to remove language in its post-meeting statement that says it will continue with ‘gradual’ rate increases.

According to its forecast, the Fed was expected to raise interest rates three more times next year, but economists now expect that will change to show two more hikes next year, with another possible in 2020. “The economy is decelerating. They were too optimistic on their outlook, but by the same token, they’re going to have to walk a fine line that they’re not overly concerned. They’re just going to take it down a notch,” said George Goncalves, head of fixed income strategy at Nomura. The Fed’s rate hike is coming against a backdrop of financial market turbulence. Markets have been reacting to concerns about rising interest rates as well as concerns trade wars and weaker global data could lead to a recession.

Fed Chairman Jerome Powell, unlike other Fed chairs, has also faced a stream of criticism from the White House, with President Donald Trump protesting rate hiking policy and in a tweet on Tuesday, the Fed’s balance sheet policy. “I do think the Fed will try and likely succeed in sending a comforting tone to the equity market. I think the market is forcing the Fed to deliver a very dovish hike. We think 2019 dots will come to two. 2020 will show one hike but just above 3 percent. The Fed will make some changes to show they are less on a pre-set course and more data dependent,” aid Mark Cabana, head of U.S. short rate strategy at Bank of America Merrill Lynch.

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“..what happens when these algo’s reverse course and rather than “buying the f***ing dip,” they begin to “sell the f***ing rallies” instead..?”

This is where I leave Lance Roberts behind. That graph simply tells me, to the extent that further graphs lose their meaning, that every single thing, the only thing, that happened since 2009 was central banks.

Has “BTFD” Become “STFR”? (Roberts)

Kevin Wilson recently penned a piece for Seeking Alpha that made a great point about where the markets are currently. To wit: “Famous market observer Art Cashin mentioned a metaphor in October 2017 that resonated with me. He said (words to the effect that) at that moment, market players had only the protection provided by pictures of lifeboats, not the lifeboats themselves. This is just like the Titanic, whose measly 16 lifeboats looked nice, but left many hundreds on board with no means of escape when the ship sank. That is the current market situation in a nutshell. Players seem to believe that their positions are diversified enough to protect them in a downturn, and in any case, many appear to expect no major drawdown in spite of many months of extreme volatility. I would argue that the risk is far greater than perceived by many, and the protections most have in place are quite inadequate.”

Indeed, that is the case. As I noted in this past weekend’s newsletter, while the S&P 500 has declined only marginally for 2018, the devastation across markets has been dramatically worse. In other words, traditional diversification, which is considered the “defacto” portfolio protection strategy by the mainstream media, has not worked. Over the last several weeks, I have been discussing the transition of the market from “bullish” to “bearish.” “The difference between a ‘bull market’ and a ‘bear market’ is when the deviations begin to occur BELOW the long-term moving average on a consistent basis.”

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There goes the Saudi budget: ‘Uncertainty and volatility reign once again. ‘

Oil Slump Could Get Much Worse Amid Oversupply Concerns (CNBC)

Oil prices are likely to fall even further over the coming weeks, analysts told CNBC Tuesday, as a sharp sell-off in global equities combines with intensifying fears about a market that could soon to be awash with crude. The latest wave of energy market selling comes amid reports of swelling inventories and forecasts of record U.S. and Russian output. Heightened worries of a possible economic slowdown in 2019 have also added downward pressure to the value of a barrel of oil. “The only way is down,” Tamas Varga, senior analyst at PVM Oil Associates, said in a research note published Tuesday.

“There are lots of variables regarding next year’s oil balance but based on available data, information and sentiment, it is fair to say that any price rally will be met by fierce resistance from the sellers’ side,” Varga said. Brent crude fell as much as 4 percent to as low as $57.20 a barrel on Tuesday, on track to register its third consecutive session of declines. The international benchmark has since trimmed some of its losses to trade down 2.7 percent. Meanwhile, U.S. West Texas Intermediate (WTI) dipped further below $50 a barrel on Tuesday, after settling below the psychologically important level for the first time in more than a year in the previous session. U.S. crude stood at $47.94 at around 11:00 a.m. ET, trading 4 percent lower.

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Scrooge and the Grinch in one person.

Alan Greenspan Has A New Warning For Investors: ‘Run For Cover’ (CNBC)

Alan Greenspan, the former Federal Reserve chief who called out the tech-fueled rally of the mid-1990s as “irrational exuberance,” is now giving investors a new warning. In a CNN interview, Greenspan said it was unlikely that the current market would stabilize and then take another big leg higher. “It would be very surprising to see it sort of stabilize here, and then take off again,” Greenspan said. Markets could still go up, but “at the end of that run, run for cover.” Greenspan told CNN the bull market is over, pointing to how stocks have fumbled in recent days.

On Tuesday, stocks rallied but they tumbled on Monday and have been in a decline since October, weighed by concerns over global trade conflict and slowing global economies. The S&P was on track, as of Monday’s close, for the worst December since 1931. [..] In the CNN interview, Greenspan said the U.S. could be headed into “stagflation,” an economy characterized by high inflation and high unemployment such as was seen in the 1970s. “How long it lasts or how big it gets, it’s too soon to tell.”

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Strangest thing for me yesterday was the judge accusing Flynn of treason, only to apologize for that accusation minutes later.

Revenge Of The Spies: Flynn Case Shows Extent Of Anti-Trump #Resistance (Malic)

President Donald Trump’s ill-fated first national security adviser Michael Flynn will twist in the wind for another three months or more, before he can face a sentence for getting caught in a FBI ambush while doing his job. Flynn was supposed to be sentenced on Tuesday, ending the year-long legal saga that destroyed his reputation, nearly bankrupted him, and even endangered his family. Then, in a bizarre last-minute twist, his lawyers asked for a delay. The next status hearing will be in March, with the actual sentencing who knows when. At one point in the hearing, Judge Emmett Sullivan urged Flynn to reconsider his guilty plea, telling him that the violation he was admitting to amounted to treason – only to walk back the comments minutes later.

The media, predictably, gave far more coverage to the original statement than the retraction. It’s the perfect example of the collective hysteria that has followed Flynn’s case from the very beginning. Despite the publication of FBI documents showing that agents interviewing Flynn in January 2017 did not think he misled them, intentionally or otherwise, about the content of his conversations with Russian ambassador to the US Sergey Kislyak, Flynn chose to stand by his guilty plea from a year ago. His reasons for this are a mystery. What is not a mystery, however, is how the people involved in railroading Flynn are the same ones implicated in the institutional #Resistance to the Trump administration.

[..] In the orgy of sensationalist reporting that has gripped the US mainstream media for the past two years, Flynn’s actual transgression has been lost to the din of shouting “treason” and “RUSSIA.” What he pleaded guilty to is lying to FBI investigators about his calls with Kislyak. The contacts themselves were right and proper, mind you: it was literally his job to reach out to foreign diplomats on behalf of the president-elect. So, why was the FBI even probing them?

That is where things get interesting. Somebody from the Obama administration – we still don’t know who – “unmasked” Flynn’s name from the classified NSA intercepts of his conversations with the Russian ambassador. This somehow got to Acting Attorney General Sally Yates, who testified that she reached out to the White House with concerns about Flynn being blackmailed. It also somehow got to the Washington Post. There was talk of the Logan Act, an obscure 200-year-old law never used to prosecute anyone.

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I have a bunch of questions and doubts, but I like Ellen Brown.

Question 1: Is it a good idea to spend trillions on Green New Deals? How much of it would be geared towards decreased energy use?

Question 2: Is Abenomics really the success Ellen claims it is?

This Radical Plan to Fund the ‘Green New Deal’ Just Might Work (Ellen Brown)

[..] the “Green New Deal” promoted by Rep.-elect Alexandria Ocasio-Cortez, D-N.Y., appears to be forging a political pathway for solving all of the ills of society and the planet in one fell swoop. Her plan would give a House select committee “a mandate that connects the dots” between energy, transportation, housing, health care, living wages, a jobs guarantee and more. But even to critics on the left, it is merely political theater, because “everyone knows” a program of that scope cannot be funded without a massive redistribution of wealth and slashing of other programs (notably the military), which is not politically feasible.

A network of public banks could fund the Green New Deal in the same way President Franklin Roosevelt funded the original New Deal. At a time when the banks were bankrupt, he used the publicly owned Reconstruction Finance Corp. as a public infrastructure bank. The Federal Reserve could also fund any program Congress wanted, if mandated to do so. Congress wrote the Federal Reserve Act and can amend it. Or the Treasury itself could do it, without the need to even change any laws. The Constitution authorizes Congress to “coin money” and “regulate the value thereof,” and that power has been delegated to the Treasury. It could mint a few trillion-dollar platinum coins, put them in its bank account and start writing checks against them.

What stops legislators from exercising those constitutional powers is simply that “everyone knows” Zimbabwe-style hyperinflation will result. But will it? Compelling historical precedent shows that this need not be the case. Michael Hudson, professor of economics at the University of Missouri-Kansas City, has studied the hyperinflation question extensively. He writes that disasters such as Zimbabwe’s fiscal troubles were not due to the government printing money to stimulate the economy. Rather, “Every hyperinflation in history has been caused by foreign debt service collapsing the exchange rate. The problem almost always has resulted from wartime foreign currency strains, not domestic spending.”

As long as workers and materials are available and the money is added in a way that reaches consumers, adding money will create the demand necessary to prompt producers to create more supply. Supply and demand will rise together and prices will remain stable. The reverse is also true. If demand (money) is not increased, supply and GDP will not go up. New demand needs to precede new supply. Infrastructure projects of the sort proposed in the Green New Deal are “self-funding,” generating resources and fees that can repay the loans. For these loans, advancing funds through a network of publicly owned banks would not require taxpayer money and could actually generate a profit for the government. That was how the original New Deal rebuilt the country in the 1930s at a time when the economy was desperately short of money.

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The title of my article yesterday very much reflects Brexit: Chaos in 2018, Mayhem in 2019.

Thousands Of British Troops On Standby For No-Deal Brexit (Ind.)

Thousands of troops have been put on standby to handle any fallout of Britain crashing out of the European Union without having secured a withdrawal deal. The government has said that, with 100 days to go until Brexit day on 29 March, it will implement all of its no-deal planning “in full” – following a clash in cabinet reflected in the wider Tory Party. Senior ministers went head-to-head, with one group demanding “no deal” become Britain’s central planning assumption, while others including the chancellor branded departing without an agreement a “unicorn” idea. Jeremy Hunt, foreign secretary, is said to have told colleagues their party would never be forgiven if it fails to deliver Brexit, but other Conservatives vowed to do everything in their power to stop a no-deal scenario.

In yet another day of Brexit high drama, defence secretary Gavin Williamson revealed he had made 3,500 troops ready to “support any government department on any contingencies they may need”. While he told MPs there had been no request for the troops yet, he said “What we are doing is putting contingency plans in place, and what we will do is have 3,500 service personnel held at readiness, including regulars and reserves, in order to support any government department on any contingencies they may need.” The Ministry of Defence later confirmed the troops would be put on alert in addition to the 5,000 already on standby to deal with potential terror attacks.

[..] Ministers have already announced plans to stockpile food and medicines, chartering ferries to bring in extra supplies and providing extra resources for border agencies. Downing Street said that advice on no-deal preparations would also be going out to households by various channels over the coming weeks. The Treasury will supply an additional £2bn on top of the £2bn already provided, with the Home Office receiving £500m for border security and handling the settlement scheme for EU nationals who want to remain in the country. Another £400m will go to Defra, the environment department, for projects including ensuring clean drinking water, which the UK treats with chemicals and gases imported from the EU.

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More British troops, just with different weapons.

“The goal was to establish “key influencers” on social media and determine who is “friendly” to the UK.”

New ‘Integrity Initiative’ Leaks: Military Ties, Infiltration of European Media (RT)

It’s been over a month since hackers began exposing the Scotland-based ‘Integrity Initiative’ as a UK government-funded propaganda outfit — and gradually new details of the organization’s clandestine activities have come to light. The documents were leaked by a group which claims to be associated with the Anonymous hackers. The first batch of leaks revealed the Integrity Initiative (II) was stealthily operating “clusters” of influencers across Europe working to ensure pro-UK narratives dominate the media. The second batch showed that the organization was also running disinformation campaigns domestically — specifically a smear campaign against Labour leader Jeremy Corbyn; all done under the guise of combatting “Russian propaganda.”

Now, a third batch of leaks has exposed that the project allegedly operated much like a modern-day version of Operation Mockingbird — a secretive 1950s project whereby the CIA worked hand-in-glove with willing journalists in major media outlets to ensure certain narratives were adhered to. Only this time, it’s a UK-funded organization with deep links to the intelligence services and military passing itself off as a non-partisan “charity.”

[..] 3. Skripal ‘monitoring campaign’ The II leapt into action after the poisoning of ex-Russian spy Sergei Skripal in March and supposedly put together a proposal to monitor social media discussion to “evaluate how the incident is being perceived” across Europe. The goal was to establish “key influencers” on social media and determine who is “friendly” to the UK. Lists of tweets on the Skripal affair were put together, along with country reports detailing how journalists in Europe were responding, the leak suggests. One report noted that in Italy, doubts about the UK narrative had been raised by “high-quality newspapers” and suggested that an “effective, discrete and articulated information campaign” must be directed at key figures in Italian politics and media.

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Neoliberalism simply failed to rise people’s living standards, so why should they support it any longer?

Either The EU Ditches Neoliberalism Or Its People Will Ditch The EU (Wight)

De Gaulle took a dim view of the UK in the postwar period, considering London a proxy of Washington. It was a view that gained common currency within French political circles after the debacle known to history as the Suez Crisis, when in 1956 the French and British entered into an ill-fated military pact with Israel to seize control of the Suez Canal from Egypt and effect the overthrow of the country’s Arab nationalist president Gamal Abdul Nasser. President Eisenhower forced the British into a humiliating retreat, threatening a series of punitive measures to leave London in no doubt of its place in the so-called special relationship. The French had been eager to continue with the Suez operation and were disgusted at London’s craven climb down in the face of Eisenhower’s intervention.

In 1958, two years after the Suez debacle, De Gaulle entered the Elysee Palace as French president. Thereafter, the humiliation of Suez still raw, he embarked on an assertion of the country’s independence from Washington that contrasted with Britain’s slavish and unedifying subservience. The French leader withdrew France from NATO’s integrated command and twice blocked Britain’s entry into the European Economic Community (EEC) – the previous incarnation of today’s EU – on the basis that London would be a US Trojan horse if admitted. There is, given this history, delicious irony in the fact that the country responsible for injecting the poison of neoliberalism into the EU – the UK under its fanatical leader Margaret Thatcher – is currently embroiled in a messy divorce from the bloc.

The EU in its current form is a latter-day prison house of nations locked inside a neoliberal straitjacket and single currency. Not only can’t it survive on this basis, but it also does not deserve to. Ultimately, either Europe’s political establishment decouples from Washington and its works – the Trump administration notwithstanding – or its peoples will decouple from them and theirs. As things stand, the latter proposition is far more likely.

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Belgian Cabinets are notorious for taking forever to form.

Belgian PM Charles Michel Resigns After No-Confidence Motion (G.)

Belgium’s government of four years has fallen on the issue of migration after the country’s parliament rejected an appeal from prime minister, Charles Michel, for its support for a minority administration. Michel was forced to offer his resignation to the King of the Belgians, Philippe, after the Socialist party, with support from the Greens, proposed a vote of no confidence in his administration. The country is now braced for a snap election in January. The head of Michel’s party said the opposition had rejected the government’s “fair offer” in order to secure a political scalp. “The Socialist opposition and Greens wanted a trophy and have it”, said David Clarinval, chairman of the liberal Reform Movement party.

[..] The N-VA, a Flemish nationalist party with hardline views on immigration, walked out of the government earlier this month over Michel’s signature to a UN migration pact providing for a common global approach to migrant flows. The draft UN accord lays down 23 objectives to open up legal migration and better manage a global flow of 250 million people, 3% of the world population. The US dropped out of talks on the pact last year and countries including Italy, Hungary, Austria, Poland, Bulgaria, Slovakia and Australia have rejected it. The deal is expected to be ratified at the UN headquarters in New York on 19 December.

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Employers can ‘ask’ employees to work 400 hrs of overtime per year without compensation.

France, Hungary, Serbia: Is Half Of Europe Protesting? (DW)

People have taken to the streets to protest against a labor law in Hungary, against tuition costs in Albania and against state violence in Serbia. Germany, meanwhile, has seen its first “yellow vest” style demonstration. Looking at the photos, one could mistake the sea of lights in Budapest for a festive holiday event. The people who gathered in Hungary’s capital Sunday night weren’t holding candles, however, but smartphones. And their message is political, not religious. They are demanding Prime Minister Viktor Orban take back a law that allows companies to ask their employees to work 400 hours overtime per year.

Since the measure was passed in parliament last Wednesday, more and more people have been protesting what has been called a “slave law.” In some cases, the rallies were overshadowed by violence. The protests on Sunday started off peaceful, but police later resorted to teargas again. With around 10,000 or even 15,000 participants, Sunday’s rally was the biggest event so far in a series of protests the likes of which Hungary hasn’t seen during Orban’s eight years in power. France is experiencing similar unrest with the “yellow vest” protests. Is the climate in Europe’s streets growing more heated?

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Of course Orban blames it all on Soros. He may come to regret ignoring his people’s anger. Same feelling as with Macron.

Hungary’s Opposition Plans More Protests After ‘Slave Law’ Passes (G.)

Hungary’s beleaguered political opposition has vowed to keep up the pressure on the country’s far-right prime minister, Viktor Orbán, after a week of protests in which thousands came on to the streets of Budapest, and four MPs were roughed up by security guards after attempting to get their demands across on state television. The protests were triggered by a so-called “slave law”, passed amid chaotic scenes in the Hungarian parliament last Wednesday, which allows employers to force employees to work overtime, and lets them delay payment for up to three years. It was passed together with legislation that provides for greater government control over the court system, the latest move by Orbán’s Fidesz party to capture independent state institutions.

A number of different opposition parties are cooperating on a joint strategy to keep pressure on the government. “We’re closely cooperating on a daily basis, and are planning roadblocks and further demonstrations if the president signs this into law,” said Tímea Szabó, of the opposition LMP party. She also said the opposition would announce civil disobedience action, though she refused to specify what it had in mind.

[..] “Brace yourselves for a new kind of democracy, one born of a carefully managed revolution by remote control,” wrote government spokesman Zoltán Kovács in a blogpost about the protests. “The revolution unfolds with protest leaders from a band of the usual suspects, many of them trained abroad and with close ties to Soros networks.” Kovács also pointed the finger at the international media, claiming they were overselling the protests, and at the “stomach-churning opportunism” of the liberal Belgian politician Guy Verhofstadt, who tweeted his support for the protests and used the hashtag #O1G, which refers to a Hungarian meme insulting Orbán in vulgar language. Kovács described Verhofstadt as “one of Soros’s henchmen in Brussels”.

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Living organisms that are 1000s of years old and span 100s a of acres.

One of Earth’s Largest Living Things Even Bigger Than Previously Thought (Ind.)

A giant honey mushroom considered a contender for the largest organism on the planet is both much larger and much older than previously thought. Scientists first studied the enormous fungus, which lives deep underground in a Michigan forest, in 1992. Then they estimated it was 1,500 years old, and the extensive mass of underground fibres and mushrooms that formed it weighed 100,000kg and stretched 15 hectares. Returning to the site, the same team used more rigorous testing to estimate the fungus was in fact closer to 2,500 years old.

They also discovered that it weighed 400,000kg and stretched over 70 hectares. This makes the enormous honey mushroom, which mostly consists of an underground network of tendrils wrapped around tree roots, heavier than three blue whales. “I view these estimates as the lower bound… The fungus could actually be much older,” said Professor James Anderson, a biologist at the University of Toronto who undertook both studies. [..] While the Michigan fungus is large, it is outclassed by another honey mushroom from Oregon that is even larger. There is also the Pando aspen in Utah, a forest originating from a single underground parent clone that is thought to weigh up to 6 million kg.


Armillaria mellea, Honey Fungus, taken in Whitewebbs Wood, Enfield, UK

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Dec 182018
 


Titian The rape of Europe 1560-62

 

It took me a while to decide which word(s) best define the past year and the next one, but I think this is pretty much it. 2018 was chaotic more than anything else, and that chaos will give rise to mayhem in 2019.

What I think is striking is that this is true across the board, in all walks of life so to speak. In finance, in politics, in energy markets, in ecological matters, and perhaps most of all in the ways all these topics are being covered by what once were trusted media.

I’m going to have to come back to all these topics separately, so it’s promising to be a very busy holiday season, but it’s also good to try and put them together in one place, if only to show how interconnected everything is. And how futile it is to look at the economy without seeing its connection to energy flows and ecosystems. And vice versa.

 

In finance and economics, we’ve seen an avalanche of falling numbers recently, in stock prices, bond prices, housing, across the globe, and obviously that evokes a lot of comments in the financial press. But that press, and bankers investors on their own, still talk about markets.

However, as I wrote in April 2018, if there is no price discovery, and there isn’t, there ARE NO markets, and it would be good and beneficial if many more people absorb that simple reality. Many more so-called traders and investors would be a start, but by no means enough. Lots more people who have nothing to do with the ‘markets’ should understand why there is no such thing anymore.

As long as you limit it to stock and bond markets, it may appear fine that people don’t understand. But as soon as you acknowledge there are no housing markets either for the exact same reasons, the story changes considerably. Because then it becomes clear that all -former- markets, bar none, have been eviscerated by central bank policies that sought to prop up banks, often highly successfully so, which they knew could only happen at the expense of communities and societies.

We’ve ended up with scores of mom and pop ‘investors’ who own hugely overpriced stocks and homes, while their pensions funds hold zillions ‘worth’ of bonds and also increasingly stocks. The link between pensions and AAA-rate assets was pulverized in the process. That looks set to continue, and worsen, in 2019. But that may be just the look of things. Because there really are no markets, there is no price discovery.

What is still there is a lot of talk about whether the Fed -and other central banks- will raise rates further or not, or will stop or continue their asset buying schemes. Central banks are the only game in town, there are no markets, nobody knows what anything is really worth because the Fed etc. took the discovery process beyond their reach.

And now all those financial ‘subjects’ are sitting on all this stuff that only appears to have value, and that value hinges exclusively on what Draghi, Kuroda, Yellen and now Jay Powell have decided things are worth. And yes, it does make matters appear okay, but because they can’t do QE forever, all of those values will need to be re-assessed by actual markets once Powell et al. are either thrown out or decide for themselves to leave the arena.

It won’t be pretty, it will be devastating. It’s impossible to say if it will come to a head in 2019, because the Fed can lower rates a bit again after its recent rate hikes and prop up the zombie for longer. Then again Draghi can’t do that anymore since he’s already in negative rate territory, and while the euro could fall to parity with the USD as a consequence, there’s a limit to that too.

Anyway, more on that later.

 

Energy and ecology seem to become more intertwined as we go along, though that may well be a trompe oeil, trick of the eye. Still, if you see and read what people have to say about things like the big COP24 event in Katowice last week, it’s obvious that the 2nd law of Thermodynamics is a hard one to internalize. Because that law seems to say that the use of energy, period, produces waste, while all these mostly well-meaning folk are merely focusing on shifting between energy sources.

There is surprisingly little attention for not using energy in the first place, which the 2nd Law appears to stipulate is the only way to stop the rot. And it’s entirely feasible to build homes that use 70-80% less power to heat and cool, or to design a transport system in a city that saves that much energy.

But the ‘leaders’, politicians and business people, prefer to address solar panels and wind turbines that allow for the amount of energy used to fall only moderately, which when combined with the economic growth that nobody questions, will lead to the use of ever more energy.

And I get that, you need to shrink your present economies, and the models they’re based on, in order to save the planet. I’m not so much talking about climate change, since the earth is a system so complex we should really be very cautious about deriving any conclusions about it from simplified models, but the species extinction reported in 2018 is another, and more immediately convincing, story.

Still, conferences like COP24, or its predecessor COP21 which I wrote about 3 years ago in CON21, are not just entirely useless, they move everything backward that all the worried boys and girls are so worried about.

The movers and shakers of the world all owe their positions to the economies, and therefore the levels of energy use, that the worried people now want to move away from. And then they turn to the same movers and shakers to make that happen. Sorry, no can do. All you’ll get is lip service from people looking for money and power, who are not interested in being proved wrong if they are.

Today’s climate discussion is a road to nowhere where down the line there’ll be nobody left to talk to and no birds singing. You yourself probably won’t be there either. There is not one politician who will volunteer to give up their power if that could save the world their children will have to live in. They’ll come up with a story where their position is save and so is that world, and they’re more than likely to believe it.

 

As for the media, the tale gets darker fast. It didn’t start in 2018, but it did become a lot more outspoken. As I’ve said before, there are three targets for the former trusted sources of impartial news, even as those sources rapidly become more partial as we move forward. And that of course has to do with their new business model I wrote about a lot: writing negative stories about Donald Trump became an obvious source of revenue well before he was president.

Once he was elected, the media doubled down. They wrote against Trump at first thinking he would be beaten in the GOP primaries, then some more when he faced Hillary, then because they didn’t like him in the White House, and finally because he turned out to be the business proposition that quite literally kept them alive. What was it, over 100,000 new subscribers for the NYT a MONTH at a certain point?! Would CNN and Rachel Maddow even exist anymore without the Donald?

But that also means that the MSM cannot report anything positive about the man, with the exception of a bombing campaign in a faraway sandbox, and that is pretty crazy. No matter where you stand politically, not even Trump can do everything wrong, but CNN, MSNBC, WaPo,NYT et al can’t say it out loud, because their new readers and viewers want negative stories.

I’m not at all a Trump fan, I find it insane that America can’t find a single person among its 320 million inhabitants who could better represent it, but I also saw well over two years ago that the reporting on Trump was so biased someone had to restore at least some balance. And if that was to be me, so be it.

It’s like the entire US -and UK- press has become the National Enquirer, where the questions of truth or accuracy have become, and/or always was, a complete afterthought, irrelevant to whatever is actually published. And the readers and viewers caught inside the echo chamber will never know any better than that that is what the world really looks like.

It’s the ‘old’ media’s response to the threat of social media, a fight they cannot possibly win in the end, but not one they will relinquish easily; it will be the end of them. So there’s Trump, and then there’s Russia and Julian Assange. And there’s a live shooting practice going on in which all three are fair game.

According to two reports published just yesterday in the NY Times and the BBC, African Americans and French Yellow Vests were targeted by Russian bots, trolls, give them a name. What these once trusted media no longer understand, or don’t care about, is that they are effectively saying that African Americans and Yellow Vests are all so stupid and so unconvinced and unconvincing in their political convictions that a bunch of poorly defined Russians made them throw their votes away from Hillary Clinton and towards Trump.

Like African Americans have no opinions and therefore in the end no functioning brains. Like their f*king robots, some inferior lifeform. Is there anything you can say that is more racist than that? I come up empty. And I understand Kanye.

And that the ‘Russians’ caused tens of thousands of Frenchmen and -women to put on a yellow vest and protest Macron’s dismantling of -very- long-standing labor rights and taxation ‘reforms’ that benefit the rich French elite. You cannot insult two such vast yet diverse groups of people, who seem to have little if anything in common, African Americans and Yellow Vests, you cannot insult them more or worse than such reports do.

And they simply don’t see it. In their view, and which they -rightly by now- trust their public will eat up like hot cakes, their 24/7 anti-Trump and anti-Russia campaigns have been so convincing that they can basically say anything at all by now. If Trump or the Russians deny, that’s just what they would do if they were guilty. Assange can’t deny anything at all, they’ve totally silenced him. They being the US deep state in liaison with the MSM.

 

That’s how we’re about to enter 2019, how we’re about to move from chaos to mayhem. It is scary not just because of what we see happening today, but even more because we’ve never seen anything remotely like it. Sure, US media, any country’s media, have always supported government strategic lies in times of warfare or other tensions.

But an overall campaign against a sitting president, comprised of dozens of articles a day consisting of mere allegations and rumors, let alone the same against a state nuclear power arguably mightier than the US itself, and a journalist who’s the only one in his profession who’s actually done what journalists should do, not the well-paid follow the party line thing going on at the MSM, all this is unprecedented.

And given what we’ve seen in 2018 in the realm of banned social media accounts, in a wider sense of the word, we can only wonder how much worse the censorship can get in the mayhem year of 2019.

Can the Automatic Earth, and for instance our friends at Zero Hedge, only continue to exist next year if we agree to increasingly become the poodles of the ruling political classes, intelligence services, and their press masters and lackeys?

It’s starting to look that way. So in closing, I want to call on you to support us by donating a Christmas gift, and preferably a recurring one all through the 2019 mayhem year, so we know we can continue to present you with an alternative to the ‘appropriate’ information you’re ‘supposed’ to be receiving.

It’s later than you think.

 

 

Dec 182018
 


Caravaggio St. John the Baptist in the wilderness 1604

 

S&P 500 Drops More Than 2% To New Low For 2018, Dow Dives 500 Points (CNBC)
The Latest Key Death Cross Is Poised To Engulf The Stock Market (MW)
Stock Market On Pace For Worst December Since Great Depression (CNBC)
How The Federal Reserve Could Spark A ‘Santa Claus’ Stock Rally (Yahoo!)
You Have A “Trading” Problem (Roberts)
China Politics Getting In The Way Of Reforms (G.)
China To Mark Economic Miracle That Pulled 700 Million People Out Of Poverty (RT)
Australia’s Central Bank Sees Risks From High Debt As House Prices Fall (R.)
‘No Existing Countermeasures’ To Russian Hypersonic Weapons – US Gov’t (RT)
The Bigotry Behind NY Times’ ‘Russians Targeted African-Americans’ (GJ)
Racist ‘Russians’ Targeted African-Americans In 2016 Election – Reports (RT)
Russia! The Gift That Keeps Giving For The BBC, Even In France (Bridge)
Fatal Over-Reach (Kunstler)
Coal Demand Will Remain Steady Through 2023 -IEA (CNBC)

 

 

Can’t wait for Christmas amd some days off. Close it down and it can’t fall further. Either that or give Jay Powell a call.

S&P 500 Drops More Than 2% To New Low For 2018, Dow Dives 500 Points (CNBC)

Stocks tanked on Monday, pushing the S&P 500 to a new low for the year amid growing concerns that the Federal Reserve’s plan to raise interest rates could be too much for the economy and stock market to handle. The S&P 500 fell as much as 2.5% to 2,530.54, surpassing its February intraday low of 2,532.69. The broad market index finished the session down 2% at 2,545.94, its lowest close for the year. The Dow Jones Industrial Average lost 507.53 points to close at 23,592.98, bringing its two-day losses to more than 1,000 points. Shares of Amazon and Goldman Sachs led the declines.

The Dow and S&P 500, which are both in corrections, are on track for their worst December performance since the Great Depression in 1931, down more than 7% so far for the month. The S&P 500 is now in the red for 2018 by 4%. The tech-heavy Nasdaq Composite dropped 2.2% to finish the day at 6,753.73 as Microsoft dropped 2.9%. The Russell 2000 — which tracks the performance of smaller companies — entered a bear market, down 20% from its 52-week high. DoubleLine Capital CEO Jeffrey Gundlach said Monday that he “absolutely” believes the S&P 500 will go below the lows that the index hit early in 2018. “I’m pretty sure this is a bear market,” Gundlach told Scott Wapner on CNBC’s “Halftime Report. The major averages fell to session lows following his comments.

Read more …

There are so many death croses lately, the term loses meaning.

The Latest Key Death Cross Is Poised To Engulf The Stock Market (MW)

Ominous-sounding death crosses have been emerging in the stock market like weeds, with the latest — and arguably, the last important such cross — about to take hold in the Dow. The Dow Jones Industrial Average is on the verge of joining other major equity benchmarks in a so-called death cross, where the 50-day — a short-term trend tracker — crosses below the 200-day, used to determine a long-term trend in an asset. Chart watchers believe that such a cross marks the point where a shorter-term decline graduates to a longer-term downtrend.

Currently, the Dow’s 50-day moving average stands at 25,173.14, compared against its 200-day average at 25,083.23, according to FactSet data, as of Friday’s close of trading. That puts the 50-day less than 90 points shy of breaching the long-term average, which could occur by the end of this week or next, based on the current pace of decline. The Dow has suffered a series of punishing drops on nagging fears of slowing global growth, unresolved trade worries and the pace of the Federal Reserve’s rate increases, with Monday’s action placing the Dow at its lowest close since March 23, 2018.

Read more …

Thank the Fed.

Stock Market On Pace For Worst December Since Great Depression (CNBC)

Two benchmark U.S. stock indexes are careening toward a historically bad December. Both the Dow Jones Industrial Average and the S&P 500 are on pace for their worst December performance since 1931, when stocks were battered during the Great Depression. The Dow and S&P 500 are down 7.8% and 7.6% this month, respectively. December is typically a very positive month for markets. The Dow has only fallen during 25 Decembers going back to 1931. The S&P 500 averages a 1.6% gain for December, making it typically the best month for the market, according to the Stock Trader’s Almanac. While the S&P 500 began dissemination in 1950, the performance data was backtested through 1928. It’s worth noting that historically, the second half of December tends to see gains.

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The Fed has absolute control. I don’t see nearly enough people being afraid of that.

How The Federal Reserve Could Spark A ‘Santa Claus’ Stock Rally (Yahoo!)

After a bruising few months for stocks, investors are banking on a ‘Santa Claus’ rally to close out 2018. Even with just a handful of trading sessions left in 2018, there is still one remaining catalyst that could spark a stock rally: the Federal Reserve. The market is pricing in a 78% chance the Fed announces a rate hike Wednesday, when it wraps up its two-day policy meeting, according to CME futures data. The rate hike itself wouldn’t spark the rally. In fact, rate hikes make stocks less attractive. But this rate hike is so priced in, that not going forward with it could signal that the Fed is worried about the economy. This would be the Fed’s fourth interest rate hike of 2018. It was in June that the Fed telegraphed this fourth rate hike.

Instead, the stock rally could be sparked by the Fed’s guidance about monetary policy in 2019. “For U.S. stocks to drift higher this week, the Fed will have to strike an easier tone about future rate hikes without signaling undue concerns about U.S. economic growth,” wrote Nick Colas, co-founder of DataTrek Research, in a note to clients Monday. But doing so may force them to downgrade U.S. economic growth forecasts for 2019, Colas said. “Changing course on rates without that air cover will make it look like the Fed is targeting asset price volatility (a.k.a. the “Fed Put”) or – worse – that the central bank is taking orders from the White House,” Colas noted, referring to President Trump’s months-long criticism — which occurred as recently as Monday — of the Fed’s monetary tightening.

[..] the Fed’s statement on Wednesday, roughly 200 words in length, will be scrutinized by investors. “The Fed could delete the words ‘gradual increases’ — meaning a hike every quarter is no longer a working assumption,” said Danielle DiMartino Booth, a former Fed advisor and CEO of Quill Intelligence. “That would take March off the table in theory and could spark a rally, even if based only on technicals, that could run into year-end.” The Fed has started to use the phrase “gradual increases” when referring to interest rate hikes in its statements starting in June. Prior to that, many of the statements included the phrase “gradual adjustments.” “Investors are hungry for even a morsel of dovishness, and what they do not say could be even more powerful than what they do say,” Booth noted.

Read more …

I don’t think the problem is where Lance sees it.

You Have A “Trading” Problem (Roberts)

As Sy Harding says in his excellent book “Riding The Bear:” “No such creature as a ‘buy and hold’ investor ever emerged from the other side of the subsequent bear market.” Statistics compiled by Ned Davis Research back up Harding’s assertion. Every time the market declines more than 10%, (and “real” bear markets don’t even officially begin until the decline is 20%), mutual funds experience net outflows of investor money. To wit: “Lipper also found the largest outflows on record from stocks ($46BN), the largest outflows since December 2015 from taxable bond ($13.4BN) and Investment Grade bond ($3.7BN) funds, and the 4th consecutive week of outflows from high yield bonds ($2.1BN), offset by a panic rush into cash as money market funds attracted over $81BN in inflows, the largest inflow on record.”

Most bear markets last for months (the norm), or even years (both the 1929 and 1966 bear markets), and one can see how the torture of losing money week after week, month after month, would wear down even the most determined “buy and hold” investor. But the average investor’s pain threshold is a lot lower than that. The research shows that it doesn’t matter if the bear market lasts less than 3 months (like the 1990 bear) or less than 3 days (like the 1987 bear). People will still sell out, usually at the very bottom, and almost always at a loss. So THAT is how it happens. And the only way to avoid it – is to avoid owning stocks during bear markets. If you try to ride them out, odds are you’ll fail. And if you believe that we are in a “New Era,” and that bear markets are a thing of the past, your next of kin will have our sympathies.

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Xi is not reforming, he’s trying to keep China above water.

China Politics Getting In The Way Of Reforms (G.)

Xi’s speech comes as the Chinese leadership is facing criticism over slowing growth and confrontation with the US. Observers hoped his speech would lay out new directions or reforms needed to help the Chinese economy, weighed down by debt and lagging consumption, and an overly dominant state sector. Instead, Xi stressed that the Party’s leadership and strategy up to now have been “absolutely correct.” He promised to support the state sector while continuing reforms in appropriate areas. His remarks lacked any detail about new policies and failed to inspire confidence in Asian markets. Hong Kong and Shanghai both dropped sharply during the speech. They are now off 1% for the day while losses have deepened to 1.8% in Tokyo and more than 1% in Sydney.

“President Xi was perhaps unsurprisingly long on rhetoric and short on details,” said Tom Rafferty, regional manager for China at the Economist Intelligence Unit. “There will be a sense of disappointment, among both local and international investors, that Xi did not give clearer signals about the direction of future economic reform at a time when the Chinese government’s commitment to market liberalisation is seen to have waned.” Critics say politics are getting in the way of needed reforms – a rare challenge to Xi, who has amassed power more quickly than any of his predecessors.

Read more …

Central question is how much of it was borrowed. How much is based on unproductive investments and sheer waste?

China To Mark Economic Miracle That Pulled 700 Million People Out Of Poverty (RT)

China has pledged more economic reforms to push growth higher and help offset any impact from the US trade conflict. It comes as the world’s second-largest economy marks the 40th anniversary of “reform and opening up” this week. Statistics show that more than 700 million Chinese people have shaken off poverty since Beijing started its program of economic reforms four decades ago. The figure accounts for over 70% of global poverty reduction during that period. The first wave of reform, which lasted from 1978 to 1989, was characterized by agricultural reform and revival of the private sector. The second wave of reform (from 1992 to 2012) resulted in the legalization of the market economy, China’s accession to the WTO, and a booming private sector.

China’s record in poverty reduction since reform and opening up is without parallel in human history, according to Wang Yiwei, professor of the School of International Studies at Renmin University. “Between 1978 and 2017, China’s economy expanded at an annual average 9.5% growth rate, increasing in size almost 35 times,” he told Xinhua News. The total expansion of China’s economy over a 39 year period was almost three times as much as Japan’s, Ross noted, adding that “No other economy commencing sustained rapid economic growth even remotely approaches the 22.3% of the world’s population as China had in 1978 at the beginning of reform and opening up.”

Read more …

Australia hasn’t gone down in 2 decades. That takes a lot of debt.

Australia’s Central Bank Sees Risks From High Debt As House Prices Fall (R.)

A combination of falling home prices, stratospheric household debt and low wage growth posed downside risks to the Australian economy, the country’s central bank warned on Tuesday, even as it predicted the next move in interest rates would likely be up. Minutes of the Reserve Bank of Australia’s (RBA) December policy meeting showed members spent a considerable time discussing the recent slowdown in global growth momentum, partly caused by a bitter tariff dispute between the United States and China. Australia is heavily leveraged to global trade with China its No.1 trading partner so any deceleration in momentum overseas will likely be negative for the A$1.8 trillion economy.

Indeed, Australia’s gross domestic product expanded at a weaker-than-expected 2.8% pace last quarter, when policy makers were hoping for “above-trend” 3%-plus growth. Dismal private consumption was a major factor hurting economic activity, even though there were some early signs of a small uptick in wages growth. “The outlook for household consumption continued to be a source of uncertainty because growth in household income remained low, debt levels were high and housing prices had declined. Members noted that this combination of factors posed downside risks,” the RBA said.

Read more …

The key to why Russia is seen as a problem. And that in turn leads to all the articles following this one.

‘No Existing Countermeasures’ To Russian Hypersonic Weapons – US Gov’t (RT)

The US is currently unable to repel an attack from the hypersonic weapons that are being developed by Russia and China, as they can pierce most missile defense systems, a recent US government report has revealed.
“China and Russia are pursuing hypersonic weapons because their speed, altitude, and maneuverability may defeat most missile defense systems, and they may be used to improve long-range conventional and nuclear strike capabilities,” the report by the Government Accountability Office (GAO) reads. The report also highlights the challenges to American security posed by Chinese and Russian anti-satellite weapons and stealth aircraft that “could fly faster, carry advanced weapons, and achieve further distances.”

The rapid development of the cutting-edge technology “could force US aircraft to operate at father distances and put more US targets at risk,” the report notes. Speaking at a Valdai Club session in October, Russian President Vladimir Putin said that Russia surpassed its rivals in terms of hypersonic weapons, calling Russia’s prevalence in the field “an obvious fact.” “Nobody has precise hypersonic weapons. Some plan to test theirs in 18 to 24 months. We have them in service already,” Putin said. In March Putin unveiled several advanced weapons systems, including the Avangard hypersonic glider warheads and the Kinzhal –or Dagger– hypersonic cruise missile. The Kinzhal can fly at Mach-10 speed and has a reported range of 2,000 km (1243 miles).

It was reported that Russia’s advanced Sukhoi Su-57 jet might soon be armed with a missile similar to the Kinzhal. While the Avangard is about to enter military service, the Kinzhal has already been deployed with the force. Faced with the unmatched hypersonic capabilities, the Pentagon has launched about a dozen programs to protect the US from hypersonic weapons. A project named ‘Glide Breaker’ to develop an interceptor capable of neutralizing incoming hypersonic gliders has been in the works with The Defense Advanced Research Projects Agency (DARPA).

Read more …

If you were African-American and you’re told all the time that you would have voted Hillary if not for the Russians co-opting you with $5,000 in ads, you would get mad too.

The Bigotry Behind NY Times’ ‘Russians Targeted African-Americans’ (GJ)

This morning, the New York Times decided to stop insulting our intelligence and instead chose to insult decency. In an article written by Scott Shane and Sheera Frenkel, Russians allegedly unleashed an intricate plot to targeted African-Americans in order to foment discontent and dupe “black people” to vote against their self-interest. According to the corporate recorders at the NY Times, the reason that African-Americans did not uniformly vote for Hillary Clinton and the Democrats is because they were too dimwitted to think for themselves and were subsequently manipulated by foreign agents. [..] Let me dispel some myths here about people who refused to vote for Hillary since I happen to be one of them.

I chose to withhold my support not because Russians conditioned me to think that way but because I refused to support a warmongering sociopath otherwise known as John McCain in pantsuits. I’ve followed Hillary’s career long enough to know that she is a corporate courtesan who can’t get enough of destabilizing nations and enriching herself by trading access for cash. Eight years of Obama catering to Wall Street and furthering George Bush’s war first policies was enough for me to tap out. [..] In other words, just because my skin color is “black” does not mean I owe my vote and loyalty to Democrats. True enough, there was a time where I was an unflinching supporter of team blue, but after seeing how Democrats are no different than Republicans, I chose to wake up.

[..] The level of duplicity on display by establishment voices is truly astounding. If leading Democrats and media personalities want to know who is responsible for the rise of Trump, they should look in the mirror. After all, it was Hillary Clinton’s “pied piper” strategy—heeded by her sycophants in the press—that elevated a reality show clown into a serious contender. Hillary Clinton and her cronies rigged the primaries, spent more than $1.2 billion and Trump was given more than a billion dollars in free media by CNN, MSNBC and their ilk, yet we are supposed to believe that $5,000 in Google ads and $50,000 on Facebook was enough to tilt the outcome of the 2016 elections.

Read more …

Who exactly here operates a troll factory?

Racist ‘Russians’ Targeted African-Americans In 2016 Election – Reports (RT)

Low voter turnout among African-Americans is usually blamed on purged voter rolls or decades of socioeconomic stasis – but in 2016, ‘evil’ Russia was the main culprit, according to two controversial reports for the US Senate. Though described as “Senate reports” by mainstream US media outlets, the two documents were actually compiled by third parties. The first was produced by a consultancy called New Knowledge, with the help of two other researchers, while the second was done by a group at Oxford University and the UK research firm Graphika. By the social media giants’ own admission, the criteria for labeling posts as “Russian” is so broad as to be practically meaningless.

That hasn’t stopped the authors of the two reports, though, who saw President Vladimir Putin’s fingerprints on every keyboard and under every bed. In particular, they argued, the “Russians” sought to depress the 2016 turnout by targeting Black Americans. Both groups relied on posts provided to the US government by Twitter, Facebook and Google and identified as coming from the St. Petersburg-based Internet Research Agency (IRA), also known as the “troll factory.” “These campaigns pushed a message that the best way to advance the cause of the African-American community was to boycott the election and focus on other issues instead,” said the Oxford report.

“The most prolific IRA efforts on Facebook and Instagram specifically targeted black American communities and appear to have been focused on developing black audiences and recruiting black Americans as assets,” says the New Knowledge report. While some African-American activists saw the reports as recognition of their community’s influence in US politics, others pointed out that blaming the “Russians” downplayed very real and long-standing racism in American society.

Read more …

African-Americans have no opinions of their own, and neither do Yellow Vests. They’re all like Putin’s zombie armies. Next up is Orban blaming Putin for Hungary’s protests.

Russia! The Gift That Keeps Giving For The BBC, Even In France (Bridge)

Given the rash of conspiracy theories leveled against Russia of late, it is no surprise that the BBC is deep-sea fishing for a Kremlin angle to explain the protests against the government of French President Emmanuel Macron. This new and improved beast of burden to explain every uprising, lost election, accident and wart, popularly known as ‘Russia’ – a strategy rebuked by none other than President Putin as “the new anti-Semitism” – provides craven political leaders with a ready-made alibi when the proverbial poo hits the fan. Yes! It can even rescue Emmanuel Macron, who just experienced his fifth consecutive weekend of protests in the French capital and beyond.

Here is the real beauty of this new media product, which promises to outsell Chanel No.5 this holiday season. Reporting on ‘Russia’ does not require any modicum of journalistic ethics, standards or even proof to peddle it like snake oil to an unsuspecting public. Simply uttering the name ‘Russia’ is usually all it takes for the fairytale to grow wings, spreading its destructive lies around the world. ‘Russia’ is truly the gift that keeps on giving! Allow me to demonstrate how easy it is to apply. Just this weekend, BBC journalist Olga Ivshina was engaged in correspondence with a stringer in France. In an effort to explain what has sparked the French protests, Ivshina gratuitously tossed out some live ‘blame Russia’ bait.

“And maybe some Russian business is making big bucks on it,” the BBC journalist solicited in an effort to conjure up fake news out of thin air. “Maybe they are eating cutlets out there en masse, for example. Or maybe the far-right are the main troublemakers?” When the question only managed to elicit an uncomfortable laugh from the stringer, the nonplussed BBC journalist exposed more trade secrets than was probably advisable. In fact, what followed seems to have been the only nugget of truth to emerge from the discussion. Ivshina confided that she was “looking for various angles” since the broadcaster, like a modern day Dracula flick, was “out for blood.”

Read more …

The next scheduled chapter in the story is Gen. Flynn’s sentencing this Tuesday. It would be a surprise if the Judge does not observe that Mr. Mueller has acted in contempt of court. Ditto if the charge against Gen. Flynn is not thrown out.

Fatal Over-Reach (Kunstler)

Last Friday morning, we adjourned the blog in anticipation of Special Counsel Robert Mueller handing over certain FBI documents in the General Flynn matter demanded by DC District Federal Judge Emmett G. Sullivan no later than 3:00 p.m. that day. Guess what. Mr. Mueller’s errand boys did not hand over the required documents — original FBI 302 interrogation reports. Instead, they proffered a half-assed “interview” with one of the two agents who conducted the Flynn interrogation, Peter Strzok, attempting to recollect the 302 half a year after it was written. Of course, Mr. Strzok was notoriously fired from the Bureau in August for bouts of wild political fury on-the-job as FBI counter-intel chief during and after the 2016 election. (This was the second time he was fired; the first was when Robert Mueller discarded him from the SC team in 2017 as a legal liability.)

So, 3:00 p.m. Friday has come and gone. It appears that the FBI 302 docs have come and gone, too. Actually, we have reason to believe that nothing ever created on a computer connected to the internet can actually disappear entirely. Rather, the data gets sucked into the bottomless well of the NSA server-farm out in Utah. Most likely, the original 302s exist and Mr. Mueller is pretending he can’t find them. In effect, it appears that Mr. Mueller has responded by gently whispering “fuck you” to Judge Sullivan.

Interestingly, The New York Times didn’t even report the story (nor The WashPo, nor CNN, nor MSNBC). Since their “Russia Collusion” narrative is foundering, they can’t tolerate any suggestion that their Avenging Angel of Impeachment, Mr. Mueller, is less than the sanctified plain dealer he affects to be. Judge Sullivan kept his own counsel all weekend. The next scheduled chapter in the story is Gen. Flynn’s sentencing this Tuesday. It would be a surprise if the Judge does not observe that Mr. Mueller has acted in contempt of court. Ditto if the charge against Gen. Flynn is not thrown out. After all, the main articles of evidence against him apparently don’t exist.

And if it turns out that Mr. Mueller and his team are disgraced by their apparent bad faith behavior in the Flynn case, what then of all the other cases connected to Mueller one way or another: Manafort, Cohen, Papadopoulos? And the other matters still in question, such as the Trump Tower meeting with the Russian “Magnitsky” lawyer and Golden Golem Junior, the porn star payoffs… really everything he has touched. What if it all falls apart?

Read more …

This is it. Given recent claims that emissions must be cut five times more than is now recognized, and there are just 2 years left to do anything meaningful concerning climate change, this is it.

Coal Demand Will Remain Steady Through 2023 -IEA (CNBC)

Coal consumption is expanding after two years of decline, but miners should brace for another period of sluggish growth, according to the International Energy Agency. In its latest annual report, the IEA forecasts global coal demand will remain essentially stable over the next five years, inching up by just over 1% between 2017 and 2023. The reason for coal’s stagnation remains unchanged from recent years: Developed nations are ditching the fossil fuel, while India and other emerging economies are turning to coal to quickly scale up electric power generation.

“In a growing number of countries, the elimination of coal-fired generation is a key climate policy goal. In others, coal remains the preferred source of electricity and is seen as abundant and affordable,” said the IEA, a Paris-based agency that advises developed nations on energy policy. The IEA’s forecast comes on the heels of a series of reports that the world is falling short of commitments to prevent catastrophic impacts from climate change and running out of time to take action. Burning coal for electric power and industrial purposes such as steelmaking is a major contributor to global warming.

Read more …

Dec 122018
 


Joseph Mallord William Turner Sunrise over Plain, with Figures 1830

 

Tory MPs Trigger Vote Of No Confidence In Theresa May Today (G.)
1000s Remain In Custody In France After Preventive Arrests (RT)
Macron’s Multi-Billion Giveaways Could Cost France Dearly (CNBC)
Yellen Warns Of Another Financial Crisis: Gigantic Holes In The System (CNBC)
IMF Warns Storm Clouds Are Gathering For Next Financial Crisis (G.)
Trump Says Fed Shouldn’t Hike Rates, But Calls Powell ‘A Good Man’ (R.)
Greece Scraps Pension Cuts (R.)
‘Forced Tech Transfer’ Must Stop Or Be Regulated – EU Envoy To China (CNBC)
Ocasio-Cortez Already Reveals The Inner Workings Of Congress (CNBC)
Faking Moon Landing More Difficult Than Doing It (RT)

 

 

May could well be out by the end of the day.

Listening to May’s speech on this topic this morning was weird. Despite her government having gutted so much of Britain’s social systems, think NHS, think child poverty, she talks about a future in which she will be leaving nobody behind. But she already did just that, in spades. It’s Orwell.

Also worth enjoying: a few hours before the Tories triggered their vote, there was this headline: Labour Keeps Open Possibility Of December No-Confidence Vote. Boy, did they miss the boat there or what? Doesn’t exactly spell having your finger on the pulse, does it? Makes Jeremy Corbyn look like a man fast asleep. Amid all the chaos, they’re still being pre-empted by the people they should have long replaced.

Tory MPs Trigger Vote Of No Confidence In Theresa May Today (G.)

Conservative MPs have triggered a vote of no confidence in Theresa May, plunging the Brexit process into chaos as Tory colleagues indicated they no longer had faith in the prime minister to deliver the deal. Sir Graham Brady, the chair of the 1922 Committee, has received at least 48 letters from Conservative MPs calling for a vote of no confidence in May. Under party rules, a contest is triggered if 15% of Conservative MPs write to the chair of the committee of Tory backbenchers. A ballot will be held on Wednesday evening between 6pm and 8pm, Brady said, with votes counted “immediately afterwards and an announcement will be made as soon as possible”.

In a press release, he said: “The threshold of 15% of the parliamentary party seeking a vote of confidence in the leader of the Conservative party has been exceeded.” The prime minister will now need the backing of at least 158 Tory MPs to see off the Brexiters’ challenge, and her position would then be safe for 12 months. However, the prime minister could decide to resign if votes against her were below the threshold to topple her, but significant enough in number.

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Orwell reigns supreme. 4,500+ arrested. 4,000+ still behind bars. And here’s what the Macron government has to say about it: “..there were in fact no preventive arrests but only “preventive control” measures.”

1000s Remain In Custody In France After Preventive Arrests (RT)

The number of people arrested since the beginning of the massive popular protests that have gripped France for weeks has surpassed a staggering 4,500, with critics calling the actions of the authorities crackdown on democracy. The French police have detained a total of 4,523 people in connection to the so-called Yellow Vests protests that united tens of thousands of people across the country discontent with taxes polices and fuel prices hikes. Of those almost 4,100 still remain in police custody, the French BFM TV broadcaster reported, citing police sources. Earlier, the French Interior Minister Christophe Castaner confirmed that more than 1,900 people were arrested in connection to the protests in just one day – on Saturday, December 8.

More than 1,700 of them were taken into custody. However, the French media later reported that the number of those arrested on that day might in fact have reached 2,000 people. Part of those arrests seemed to be a preventive measure as they occurred before the protests. And the practice alarmed many. “When we [see] 1,000 people [detained] and 540 of them released two days later, it is obvious that there were at least 540 absolutely unjustified arrests,” a Paris lawyer, Raphael Kempf, told BFM, commenting on the issue. “Being locked up for 48 hours, they were deprived of their right to join a demonstration and this is shocking for a democratic country,” he added. The government, however, justified its approach by saying that there were in fact no preventive arrests but only “preventive control” measures.


Macron declaring his solidarity with the peuple from behind a gold desk.

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Napoleon is an emperor. He’s bigger than Brussels.

Macron’s Multi-Billion Giveaways Could Cost France Dearly (CNBC)

French President Emmanuel Macron announced tax cuts and wage rises on Monday in a bid to placate anti-government protesters, but the move will increase France’s budget deficit and is likely to create tensions with the European Commission. Macron promised on Monday to raise the minimum wage by 100 euros ($114) a month and that overtime will not be taxed or subject to social welfare charges. He also said the tax hike on pensions will be reversed for anyone with an income of below 2,000 euros a month, and encouraged companies to pay a tax-free end-of-year bonus.

[..] Macron’s promises might be a balm to some protesters, but economists note that they come at a cost. France’s borrowing costs rose on Tuesday with the spread between France and German ten-year bonds – seen as an indicator of risk sentiment – the widest since May 2017. The yield on France’s 10-year bond rose five basis points to 0.756 percent Tuesday before declining to 0.726 percent. Macron’s pledges are likely to get France into trouble with the European Commission for raising its budget deficit, the amount by which its spending exceeds its revenues, above the permitted limit of 2 percent of GDP. Macron’s announcement could also be a gift to Italy, given its own wrangling with the Commission over its spending plans for 2019.

“Macron’s sweeteners are coming at a cost,” Berenberg Economists Kallum Pickering and Florian Hense said in a research note Tuesday. “They add up to 10 billion euros or slightly more, equivalent to 0.4 percent of GDP. On top of the already announced 4 billion to cancel the fuel tax hike, this could push the 2019 deficit from 2.8 percent to 3.4 percent of GDP unless offset by savings, which will be difficult to find,” they noted. France’s debt-to-GDP will likely rise beyond 100 percent as a result of the concessions too.

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More Orwell: Yellen’s “The tools that are available to deal with emerging problems are not great in the United States.” Should be:“The tools that are available to deal with the problems I caused are not great in the United States.”

Yellen Warns Of Another Financial Crisis: Gigantic Holes In The System (CNBC)

Former Federal Reserve Chair Janet Yellen told a New York audience she fears there could be another financial crisis because banking regulators have seen reductions in their authority to address panics and because of the current push to deregulate. “I think things have improved, but then I think there are gigantic holes in the system,” Yellen said Monday night in a discussion moderated by New York Times columnist Paul Krugman at CUNY. “The tools that are available to deal with emerging problems are not great in the United States.” Yellen cited leverage loans as an area of concern, something also mentioned by the current Fed leadership. She said regulators can only address such problems at individual banks not throughout the financial system.

The former fed chair, now a scholar at the Brookings Institution, said there remains an agenda of unfinished regulation. “I’m not sure we’re working on those things in the way we should, and then there remain holes, and then there’s regulatory pushback. So I do worry that we could have another financial crisis.” In the wake of the financial crisis, some agency regulatory powers were vastly expanded, but others, for example, the ability of the Fed to lend to an individual company in a crisis, were curtailed. Current Fed officials have pushed back against criticism that their reforms are making the system riskier, saying they are making the system more efficient. Speaking in London in June 2017, shortly after leaving office, Yellen had said she did not believe there would be another financial crisis in our lifetimes because of financial reforms.

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What goes for Yellen and the Fed, also applies to the IMF: they apparently remain convinced that crises happen not because of, but despite them.

IMF Warns Storm Clouds Are Gathering For Next Financial Crisis (G.)

The storm clouds of the next global financial crisis are gathering despite the world financial system being unprepared for another downturn, the deputy head of the International Monetary Fund has warned. David Lipton, the first deputy managing director of the IMF, said that “crisis prevention is incomplete” more than a decade on from the last meltdown in the global banking system. “As we have put it, ‘fix the roof while the sun shines’. But, like many of you, I see storm clouds building and fear the work on crisis prevention is incomplete.” Lipton said individual nation states alone would lack the firepower to combat the next recession, while calling on governments to work together to tackle the issues that could spark another crash.

“We ought to be concerned about the potency of monetary policy,” he said of the ability of the US Federal Reserve and other central banks to cut interest rates to boost the economy in the event of another downturn, while also warning that high levels of borrowing by governments constrained their scope for cutting taxes and raising spending. Lipton said the IMF went into the last crash under-resourced before it was handed a war chest worth $1tn from governments around the world, while adding that it was important that national leaders had agreed to complete a review of the fund’s financial firepower next year. “One lesson from that crisis was the IMF went into it under-resourced; we should try to avoid that next time.”

[..] Against a backdrop of Donald Trump engaging in a bitter trade dispute with Beijing, he said China needed to lower trade barriers, while also impose tougher rules to protect intellectual property – a key complaint of the US president. Lipton suggested that Chinese trade policies that were once considered acceptable when it joined the World Trade Organization in 2001 as a $1tn economy may now be inappropriate as it had become a $16tn international superpower. However, he did warn that the US should not take an overly heavy-handed approach to reform, adding: “China has many reforms that it could carry out that would be in its own interest and in the interest of countries around the globe. But China feels they can’t take those steps, as they put it, with a gun to their head, in the midst of trade tensions.”

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“I think we are a rocket ship going up.”

Trump Says Fed Shouldn’t Hike Rates, But Calls Powell ‘A Good Man’ (R.)

President Donald Trump said on Tuesday it would be a mistake if the Federal Reserve raises interest rates when it meets next week, as it is expected to do, continuing his criticism of the U.S. central bank. “I think that would be foolish, but what can I say?” Trump told Reuters in an interview. Trump said he needed the flexibility of lower interest rates to support the broader U.S. economy as he fights a growing trade battle against China, and potentially other countries. “You have to understand, we’re fighting some trade battles and we’re winning. But I need accommodation too,” he said.

Trump named Jerome Powell as Fed chairman, but has repeatedly railed against him since he took over as head of the U.S. central bank last February. Trump in August told Reuters that he was not “thrilled” with Powell’s raising interest rates. Trump was more conciliatory in his comments about Powell on Tuesday, but still criticized the policies of the man he chose for the top Fed job. “I think he’s a good man. I think he’s trying to do what he thinks is best. I disagree with him,” Trump said. “I think he’s being too aggressive, far too aggressive, actually far too aggressive.” [..] “Are we heading for a recession?” Trump said. “In my opinion, we are doing really well. Our companies are doing really well. If the Fed is going to act reasonably and rationally, I think we’ll go – I think we are a rocket ship going up.”

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Round 14 of pension cuts is reversed. The rest remains.

Greece Scraps Pension Cuts (R.)

Greece’s Parliament on Tuesday voted to scrap plans to cut state pensions, in a motion led by the left-led governing coalition hoping to shore up its flagging support ahead of a general election next year. Eventually the bailout, worth up to 86 billion euros, expired in August without IMF assistance, and Athens has said better-than-expected public finances enable it to rescind the planned cutbacks. The European Commission has approved the government’s decision. “The time has come for people to be rewarded for their sacrifices,” Prime Minister Alexis Tsipras told lawmakers ahead of the vote, calling the step a “necessary breath for the people of labour … who saw their pensions and their dignity hurt.”

Pensioners, who are in many households the only people with an income due to the highest unemployment rate in the eurozone, have seen earnings shrink by up to 40 percent since Greece toppled into crisis in late 2009. Tsipras’s term ends in 2019. His SYRIZA party is trailing the conservative New Democracy by about 10 points in opinion polls. Since 2010, Greece has signed up to three international bailouts totalling almost 290 billion euros, and will remain heavily indebted for years to come. The country is monitored by its eurozone partners and the IMF to ensure it does not veer off post-bailout targets aimed at maintaining high budget surpluses in coming years.

New Democracy (ND) accused the government of increasing taxes and handing out benefits from budget revenues to win votes. “You are wearing the mask of the philanthropist just to tip people from their own savings,” ND leader Kyriakos Mitsotakis told Tsipras in parliament.

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“We believe in an open economy, we believe in globalization, but we need to make sure that these investments are conducive to growth.”
-Nicolas Chapuis, EU ambassador to China

Really?! Ask the people if they ‘believe’ in globalization. Ask the yellow vests.

‘Forced Tech Transfer’ Must Stop Or Be Regulated – EU Envoy To China (CNBC)

The European Union has a vested interest in promoting technology exchanges with China, but any transfers should be regulated, said the trade bloc’s ambassador to China on Wednesday. “For the last 40 years, EU companies have provided most of the foreign tech that is in China, about 50 percent of what is today in China,” said Nicolas Chapuis, ambassador of the EU delegation to China. However, the diplomat expressed concerns about China trading market access for technology. Beijing sometimes forces foreign companies to hand over their technological know-how in exchange for access to its massive domestic market.

The administration of U.S. President Donald Trump has demanded that China cease forced tech transfers, which have become a flashpoint in the U.S.-China trade war. “This has to stop or to be regulated,” Chapuis told CNBC at the European Chamber Annual Conference 2018 in Beijing. “Of course if a company wants to open its tech books to a Chinese company — all right, that’s not an issue, but it has to be regulated so that there is no so-called ‘forced tech transfer,'” Chapuis said. Beijing has claimed it will step up protection of intellectual property rights, but experts point out that the country still wields its state-controlled legal system to take whatever trade secrets it wants for its own companies.

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Anything better than Hillary and Schumer, I guess.

Ocasio-Cortez Already Reveals The Inner Workings Of Congress (CNBC)

Although her first day on the job is still weeks away, Alexandria Ocasio-Cortez is already pulling back the curtain on the inner workings of the Capitol. The New York Democrat, along with other incoming freshman lawmakers, is trying to usher in a culture of openness that is enabled by a vast social media following. With nearly 3 million followers combined on Facebook, Instagram and Twitter, Ocasio-Cortez has used the platforms to involve her supporters during the transition period before she takes office. Her enthusiastic and often pugnacious transparency campaign has earned her praise from inside and outside the Beltway. Yet it has also drawn criticism from several corners, including from President Donald Trump’s eldest son.

In a series of pictures and videos on Instagram dubbed “Congress Camp,” she gave an inside look into new-member orientation, from choosing an office to voting for House leadership, while also showcasing the unique quirks of life on Capitol Hill. “Guys, there are secret underground tunnels between all of these government buildings!” she whispers in one video. In another post, she polls her followers on whether she should choose an office with more space or one “close to our friends.” But Ocasio-Cortez isn’t just focusing on the novelty of her experience. Last week, she tweeted sharp criticism of an orientation for new members of Congress hosted by Harvard. The event featured corporate CEOs but no labor representatives.

Ocasio-Cortez hasn’t given any indication that she will let up, however. “Our ‘bipartisan’ Congressional orientation is cohosted by a corporate lobbyist group. Other members have quietly expressed to me their concern that this wasn’t told to us in advance,” she tweeted. “Lobbyists are here. Goldman Sachs is here. Where’s labor? Activists? Frontline community leaders?” Fellow freshman member Rashida Tlaib, D-Mich., echoed her criticisms. Tlaib said that Gary Cohn, former chief economic advisor to President Donald Trump and former Goldman Sachs executive, told the new members at orientation that they don’t “know how the game is played.” “No Gary, YOU don’t know what’s coming – a revolutionary Congress that puts people over profits,” Tlaib tweeted.

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Checking it twice.

Faking Moon Landing More Difficult Than Doing It (RT)

The head of the Russian space agency may joke about ‘verifying’ if the Americans landed on the moon, but there are no doubts for one Russian scientist, who weighed in on the decades-long conspiracy debate. The claim that NASA never landed astronauts on the moon and that evidence to the contrary was fabricated is among the most pervasive in popular culture and has been a point of fierce debates. Dmitry Rogozin, Russia’s space chief, even recently joked that Russia’s future lunar missions will give the country an opportunity to check whether Neil Armstrong’s footprints are actually out there.

That aside, people who actually study the moon for a living believe there is no need to launch spaceships just to prove the success of the Apollo program. Fabricating a lunar landing would probably be technologically impossible and anyway economically unnecessary, told RIA Novosti Yury Kostitsyn. The man heads the Institute of Analytical Chemistry, which is directly involved in developing sensors for space and was part of the Soviet robotic study of the moon. “Faking the landing of the American astronauts to the Moon would have been more complex and expensive than actually doing it,” the scientist assured. The key piece of evidence in his own field of knowledge is the moon soil, which the Americans said to have retrieved. It was studied in labs of many countries, including the USSR, and it’s definitely not from this planet.

“Falsifying moon soil is impossible. The Americans brought back to Earth about 300 kilos of it, most of it basalt,” he explained. “We have basalts on Earth too, but they are significantly different from the lunar ones in their chemical composition, properties, and structure. There are no rock formations older than 3.7 billion years, and what the Americans brought is over 4 billion years old, comparable to the age of the solar system.” (NB. There are actually rocks of earth origin dated over 4bn years, but the ones brought from the Moon are still older.) “There is nothing to argue about Americans landing on the moon between 1969 and 1972,” Kostitsyn stressed. “You won’t hear a single cosmonaut say they didn’t.”

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Dec 112018
 
 December 11, 2018  Posted by at 10:44 am Finance Tagged with: , , , , , , , , , , , , ,  4 Responses »


Arnold Böcklin The Isle of the Dead III 1883

 

Jerome Powell Is Between A Rock And A Hard Place (Nomi Prins)
Macron Bows To Protesters’ Demands: “I Know I Have Hurt Some Of You” (G.)
‘Yellow Vests’ Denounce Macron Speech As ‘Charade’ (AFP)
Let’s Call The Whole Thing Off (Ind.)
Sturgeon Offers To Unite With Corbyn To Topple ‘Shambles’ Government (Ind.)
Pound Falls To Lowest In Almost Two Years Amid Brexit Uncertainty (G.)
Hedge Funds Make Big Bets Against Post-Brexit UK Economy (G.)
Mueller’s Investigation is Missing One Thing: A Crime (AC)
Jerome Corsi Sues Robert Mueller, DOJ, FBI, NSA, CIA For $350 Million (CNBC)
Not So Fast (Jim Kunstler)

 

 

I don’t know, Nomi. The whole thing just spells out to me how ridiculous things have become because of the powers the Fed has been given. The only sensible thing anyone can do, including Powell, is to retreat and let the market be reborn. Until then, any talk about ‘the market(s)’ has no meaning.

Jerome Powell Is Between A Rock And A Hard Place (Nomi Prins)

One of the major drags on the market, besides trade wars, has been uncertainty about whether the Fed will raise rates this month. Despite the verbal bravado of Federal Reserve Chairman, Jerome Powell, over how strong the U.S. economy is, he doesn’t live in a vacuum. Powell’s borne the brunt of President Trump’s recent accusations that the Fed’s hikes are what’s hurting the stock market and threatening the economy. That lead to a media debate over whether Powell would “cave” to Trump or demonstrate that the Fed is the independent body that it’s legally designed to be, and continue with planned hikes anyway. Powell’s recently indicated again that he planned to go ahead with another 0.25 rate hike when the Fed meets Dec. 19, which would be the fourth increase this year.

But on Nov. 28, he revealed something in his speech at the Economic Club of New York that I’ve been predicting. He dialed back talk about rate hikes. He said that rates were “just below” neutral. That contrasted sharply with his comments from Oct. 3rd when he said “We are a long way from neutral at this point.” In other words, he’s turned dovish. That’s a major shift in less than two months’ time. But why the change? It likely had much less to do with pressure from Trump than deteriorating economic and market conditions. Heavy market volatility was just starting to return when he his Oct. 3 comment. It’s only gotten worse since then. At some point, the wobbling in the financial markets must have gotten to him. As the Daily Reckoning’s, Brian Maher said, single-day losses of 300, 500, 700 — 800 points — seem almost commonplace now. “The stock market is a wreck of nerves these days,” he said, “like a man walking point in a dark enemy jungle.”

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After long deliberation with his spin doctors, lawyers and PR guys, Macron has decided to gamble on the protests being all about money. If handing out the billions he announced yesterday calms things down, even if it takes France out of the EU budget comfort zone, the protests were never about anything real. But if the yellow vests’ Act V next Saturday is anything like the first 4, he’s in deep doodoo.

Also: he was MIA for 10 days or so. And then his speech yesterday was pre-recorded. He still hasn’t communicated live with the French people.

Macron Bows To Protesters’ Demands: “I Know I Have Hurt Some Of You” (G.)

Emmanuel Macron has bowed to pressure from the street to announce a catalogue of emergency measures aimed at pacifying the gilets jaunes after weeks of civil unrest in France. In a long-awaited address on primetime television, the president tried to talk the protesters out of further action, promising a rise in the minimum wage and tax concessions. In a mea culpa, Macron said he had heard and understood protesters’ anger and indignation, which he said was “deep and in many ways legitimate”. He admitted he had not been able to provide solutions quickly enough since his election. “I may have given you the impression that this was not my concern, that I had other priorities. I take my share of responsibility. I know I have hurt some of you with my words,” he said.

The president began his pre-recorded 13-minute declaration saying the past few weeks of protests had “profoundly troubled the nation”, and that legitimate demands had led to “a series unacceptable violence”. He said the anger went back 40 years, but he added: “No anger justifies attacking a police officer, a gendarme, or damaging a shop or public building. When violence is unleashed, freedom ends.” Macron, elected on a centrist reforming programme 18 months ago, said he understood the anger and “distress” of those struggling to make ends meet at the end of the month who felt ignored and economically squeezed: “It is as if they have been forgotten, erased. This is 40 years of malaise that has risen to the surface. It goes back a long way, but it is here now.”

To help struggling workers, he said the government had been ordered to introduce “concrete measures” from 1 January, including increasing the minimum wage by €100 (£90) a month. Overtime would be exempt from tax and social charges, and a planned tax on pensions under €2,000 a month would be cancelled. All employers “who can” were asked to give workers a tax-free bonus at the end of the year. Macron said there would be greater public consultation on issues, but he would not go back on his wealth tax reforms. However, things would not “go back to normal … as if nothing has changed,” he said.. He concluded: “We are at a historic moment in our country. With dialogue, respect, and engagement, we will succeed. My only concern is you, my only combat is for you – our only battle is for France.”

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It may just make them madder.

‘Yellow Vests’ Denounce Macron Speech As ‘Charade’ (AFP)

Groups of “yellow vest” protesters across France responded scathingly to the “crumbs” offered by President Emmanuel Macron in a speech intended to defuse their revolt, but others acknowledged his efforts. “Nonsense,” “a charade”, “a bluff” and “a drop in the ocean,” were among the immediate reactions that greeted the head of state’s televised speech Monday evening announcing an increase in the minimum wage and a range of other financial measures. At a roundabout in the southern town of Le Boulou, some 150 “yellow vests” gathered around a loudspeaker listened carefully to the president’s words before starting to shout in chorus. “He is trying to do a pirouette to land back on his feet but we can see that he isn’t sincere, that it’s all smoke and mirrors,” said Jean-Marc, a car mechanic.

“It’s just window dressing, for the media, some trivial measures, it almost seems like a provocation,” said Thierry, 55, a bicycle mechanic who donned the yellow vest a fortnight ago. “All this is cinema, it doesn’t tackle the problems of substance,” he told AFP before taking part in blocking the Boulou turnpike on the French-Spanish border. “We’re really wound up, we’re going back to battle,” he said. Less than an hour after the presidential address, the A9 toll booth from Spain was completely paralysed, an AFP photographer said. “Maybe if Macron had made this speech three weeks ago, it would have calmed the movement, but now it’s too late,” said Gaetan, 34, one of the “Rennes Lapins Jaunes” (Yellow Rabbits of Rennes). “For us, this speech is nonsense.”

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Theresa May is as out of touch with her people as Macron is.

The main event yesterday in the Commons was a guy picking up the ceremonial mace, a 17th century piece of metal. Just to show how out of touch the politicians, and their entire nation, are.

Well, that and May annoucing she was going to flee the country. But why would the EU change its stance, or the deal May signed, just to save her career?

Let’s Call The Whole Thing Off (Ind.)

Theresa May has sparked anger across the Commons by refusing to say when MPs will vote on her Brexit deal, as she prepared to head to Brussels to plead with EU leaders for further concessions. The showdown was dramatically delayed, almost certainly until the new year, after the prime minister admitted a Tory revolt meant she was heading for a crushing defeat “by a significant margin”. But condemnation of Ms May for pulling back rose when Downing Street failed to set a new timetable for the vote, arguing it depended on when she could “get the assurances” from the EU to pass the deal. Government sources admitted a quick breakthrough was unlikely, suggesting the vote would be shelved until the new year and refusing to say it would even be held next month.

In extraordinary scenes, Labour MP Lloyd Russell-Moyle was ejected from the House of Commons for seizing the ceremonial mace in protest at the formal deferral of the vote by the government whips. Mr Russell-Moyle swung the antique symbol of parliamentary authority from its holder as Tory MPs screamed “expel him”. He was promptly asked to leave the chamber by John Bercow, the speaker. His intervention came moments after Labour leader Jeremy Corbyn secured an emergency debate on the delay on Tuesday.

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If May had had any actual opposition, this farce would have been long over.

Sturgeon Offers To Unite With Corbyn To Topple ‘Shambles’ Government (Ind.)

Nicola Sturgeon has appealed to Jeremy Corbyn “work together” to topple Theresa May’s government after a crucial vote on the prime minister’s Brexit deal was abandoned, promising the SNP will support a motion of no confidence if it is tabled by Labour. The Scottish first minister said delaying the vote was “pathetic cowardice” and vowed that her party would stand with Labour if it follows through with its plan to bring down the government with a confidence vote on Tuesday. It comes amid chaotic scenes in Westminster, where reports that the meaningful vote was being shelved broke just moments after a Downing Street spokeswoman told reporters it would go ahead.

Ms Sturgeon posted on Twitter: “So @jeremycorbyn – if Labour, as official opposition, lodges motion of no confidence in this incompetent government tomorrow, @theSNP will support & we can then work together to give people the chance to stop Brexit in another vote. “This shambles can’t go on – so how about it?” The Labour leader has not responded to her offer but the first minister’s comments will ramp up the pressure on the beleaguered prime minister, as she faces one of the biggest challenges of her premiership.

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Parity with the USD in early 2019?!

Pound Falls To Lowest In Almost Two Years Amid Brexit Uncertainty (G.)

The pound has dropped to its lowest level for almost two years amid the growing risks to the British economy from political paralysis over Brexit and on a no-deal scenario. Theresa May’s decision to delay the parliamentary vote on her Brexit plan to avoid an embarrassing defeat for the government sent sterling tumbling by more than 1.3% against the dollar and by almost 1% against the euro on the foreign exchanges. The pound slumped below $1.26 to the lowest level since April 2017 after the prime minister said her Brexit plan would have been rejected by a “significant margin” in a Commons vote pencilled in for Tuesday. Sterling was worth $1.2563 against the dollar late on Monday and €1.1062 against the euro.

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They now have a solid reason to push for a no-deal Brexit.

Hedge Funds Make Big Bets Against Post-Brexit UK Economy (G.)

A pair of hedge funds owned by prominent Brexit supporters have made significant bets against companies exposed to the British consumer including big high street names. Odey Asset Management, part-owned by Crispin Odey, and Marshall Wace, part-owned by Sir Paul Marshall, have declared short positions against consumer-exposed companies, including retailers, estate agents and banks, equivalent to £149m and £572m respectively – as rising political uncertainty threatens the economy. The retail sector is facing particular scrutiny from short sellers, who in effect wager significant sums on certain shares falling in value. Uncertainty among consumers, with the Brexit process reaching a crunch point, comes at a time when retailers are already struggling to adjust to the move from physical shops to online.

The hedge fund run by Odey, one of the most outspoken of the Brexit-backing hedge fund managers, holds a short position in Intu – the owner of shopping malls including the Trafford Centre in Greater Manchester – that represented £33m worth of shares in the company at the end of last week. He also holds a position against struggling department store Debenhams that is worth £5.3m. The firm also appears to be betting that Britons’ appetite for cars will fall, in line with surveys showing hesitation over big-ticket purchases. The firm has short positions against Lookers, a large dealership chain, and Auto Trader, the online used-car directory.

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Watergate started with a crime. Russiagate did not. It started with a dodgy dossier.

Mueller’s Investigation is Missing One Thing: A Crime (AC)

The primordial ooze for all things Russiagate is less-than-complete intelligence alleging that hackers, linked to the Russian government, stole emails from the Democratic National Committee (DNC) in 2016. The details have never been released, no U.S. law enforcement agency has ever seen the server or scene of the crime, and Mueller’s dramatic indictments of said hackers, released as Trump met with Putin in Helsinki, will never be heard of again, or challenged in court, as none of his defendants will ever leave Russia. Meanwhile, despite contemporaneous denials of the same, is it somehow now accepted knowledge that the emails (and Facebook ads!) had some unproven major effect on the election.

The origin story for everything else, that Trump is beholden to Putin for favors granted or via blackmail, is opposition research purchased by the Democrats and carried out by an MI6 operative with complex connections into American intelligence, the salacious Steele Dossier. The FBI, under a Democratic-controlled Justice Department, then sought warrants to spy on the nominated GOP candidate for president based on evidence paid for by his opponent. Yet the real spark was the media, inflamed by Democrats, searching for why Trump won (because it can’t be anything to do with Hillary, and “all white people and the Electoral College are racists” just doesn’t hold up).

Their position was and is that Trump must have done something wrong, and Robert Mueller, despite helping squash a Bush-era money-laundering probe, lying about the Iraq War, and flubbing the post-9/11 anthrax investigation, has been resurrected with Jedi superpowers to find it. It might be collusion with Russia or Wikileaks, or a pee tape, or taxes, packaged as hard news but reading like Game of Thrones plot speculation. None of this is journalism to be proud of, and it underlies everything Mueller is supposedly trying to achieve. [..] The core problem—at least that we know of—is that Mueller hasn’t found a crime connected with Russiagate that someone working for Trump might have committed. His investigation to date hasn’t been a search for the guilty party —Colonel Mustard in the library— so much as a search for an actual crime, some crime, any crime.

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Even if he’s legally right, what are his odds of winning?

Jerome Corsi Sues Robert Mueller, DOJ, FBI, NSA, CIA For $350 Million (CNBC)

Jerome Corsi, a conspiracy theorist and Roger Stone associate, has filed a federal lawsuit accusing special counsel Robert Mueller of illegally searching his phone records and leaking grand jury information. Corsi, an avid supporter of President Donald Trump, recently claimed he faces indictment by Mueller. Attorneys for Corsi, 72, filed the lawsuit Sunday night in U.S. District Court in Washington. In addition to Mueller, it targets the Justice Department, the National Security Agency, the FBI and the CIA. The attorneys are demanding $100 million in “general and compensatory damages” and $250 million in “punitive damages” from the agencies.

In the complaint, Corsi’s lawyers argue that their client’s Fourth Amendment right against unreasonable or unwarranted government searches and seizures was violated when “each and every one” of the defendants looked through his digital records without a warrant and probable cause. The complaint also accuses Mueller of directing his staff to leak information from his grand jury about Corsi to the media. Special counsel spokesman Peter Carr declined CNBC’s request for comment on the court filing. Mueller’s team has reportedly investigated for months whether Corsi learned in advance that WikiLeaks had received Hillary Clinton campaign chairman John Podesta’s emails, which U.S. intelligence services have concluded were stolen by Russian intelligence officers.

[..] Corsi also accuses the special counsel of trying to make him lie under oath that he was a liaison between Stone and WikiLeaks founder Julian Assange in the publication of stolen Democrats’ emails.

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Flynn’s revenge on Mueller?

Not So Fast (Jim Kunstler)

Gen. Flynn may actually have the goods on the fraud behind his own prosecution — namely, proof of exactly how he was set up by Mr. Obama, in particular his own tapes of conversations with Russian Ambassador Sergey Kislyak that would show something different than the transcripts Mr. Mueller used to entrap him on Lying-to-Federal-Prosecutors rap. That theory raises the question: why did he not use it in his own defense. The answer may simply be that he didn’t want to rack up $2.5 million in billable hours for defense attorneys and chose instead to tough it out for nearly two years until he could use the information he has. And that means he must wait until final sentencing when his case is complete.

That appears in the offing, perhaps even before Mr. Mueller releases his much panted-over final report. Of course, Mr. Mueller may have absolutely no idea what Gen. Flynn has got on him — hence the speculation about why the charging memo was so lenient. But that line of reasoning suggests that Gen. Flynn will just forget about the disgrace Mr. Mueller put him through and let bygones be bygones. That’s not how warriors roll. More likely, Gen. Flynn has something more severe in mind. For all of his horse-faced gravitas in the photos of his fleeting sightings, Mr. Mueller does not look to me like a man in a comfortable situation.

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