Jan 042019
 
 January 4, 2019  Posted by at 10:24 am Finance Tagged with: , , , , , , , , , , , ,  


Yasuhiro Ishimoto Untitled, Chicago 1950

 

Congratulations! Apple Loses Record $463 Billion in Market Cap in Three Months (Mish)
Apple Just Lost A Facebook (CNBC)
Apple Suffers Its Biggest Single-Day Loss In 6 Years (CNBC)
Why This Time Is Different (MooTrades)
Democrats Introduce Impeachment Articles On 1st Day In The House (RT)
Canada Says 13 Citizens Detained In China Since Huawei CFO’s Arrest (R.)
UBS Chairman Pours Cold Water On Deutsche Bank Merger Talk (R.)
Google Shifted $23 Billion To Tax Haven Bermuda In 2017 (R.)
Over Half Of Tory Members Consider Quitting Party Over May’s Brexit Deal (BI)
US Judge Limits Evidence In Trial Over Roundup Cancer Claims (R.)
New Brazil President Bolsonaro Launches Assault On Amazon Rainforest (G.)

 

 

Losing half a trillion in 3 months should be no surprise now central banks have killed the negative feedback from a functioning market. It’ll be runaway wild swings till it is restored.

Congratulations! Apple Loses Record $463 Billion in Market Cap in Three Months (Mish)

Apple set a record that will take a long time to beat. The first $ trillion company lost nearly half that in 3 months. On, August 2, Apple became the World’s First Trillion-Dollar Company at $207.05 per share. Hooray! On October 3, Apple had a peak market cap of about $1.138 trillion. Today, Apple’s market cap is about $675 billion. That’s a record market cap loss of $463 billion in three short months. Expect more stories similar to this, but this may be hard to top. Amazon has a chance but it needs a big disaster soon.

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• more than double the size of Wells Fargo • more than three times the size of McDonald’s • more than five times the size of Costco • more than 10 times the size of Raytheon.

Apple Just Lost A Facebook (CNBC)

In only three months, Apple has lost $452 billion in market capitalization, including tens of billions on Thursday as the tech giant’s stock sank further. Apple shares have fallen by 39.1 percent since Oct. 3, when the stock hit a 52-week high of $233.47 a share. With its market cap down to about $674 billion, those losses are larger than individual value of 496 members of the S&P 500 — including Facebook and J.P. Morgan. Microsoft, Amazon, Alphabet and Berkshire Hathaway are the only S&P 500 members with larger market caps than Apple’s loss since its recent high.

To put the Apple market value plunge in context, $446 billion is: • more than double the size of Wells Fargo • more than three times the size of McDonald’s • more than five times the size of Costco • more than 10 times the size of Raytheon. Apple gave a sudden warning to investors on Wednesday afternoon, lowering its fiscal first-quarter revenue guidance. Wall Street reacted, with one analyst saying this will represent Apple’s “biggest miss in years” and another saying the company’s announcement “raises more questions than answers.” Apple CEO Tim Cook’s letter to investors blamed a variety of factors for the guidance cut, including declining iPhone revenue and China’s weakening economy.

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Only 6 years? That makes it sound cookie cutter.

Apple Suffers Its Biggest Single-Day Loss In 6 Years (CNBC)

Apple stock cratered almost 10 percent Thursday, a day after slashing revenue guidance in a rare acknowledgement of waning sales. The stock ended trading at $142.19, its lowest price level since July 2017. The plunge makes for Apple’s worst day of trading since January 2013, and it extends a painful year-end trend for Apple into 2019. The stock, which once traded above $230 per share, shed 30 percent in the fourth quarter of 2018. Thursday’s losses push Apple’s market valuation below $700 billion and behind the market cap of Alphabet to become the fourth most valuable publicly traded U.S. company — down from the top spot just two months ago. The company has lost $450 billion in market value since its peak of about $1.1 trillion last year.

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Hard not to think that people working in finance still can’t believe the industry doesn’t function. They keep trying to explain what happens, from inside their faulty models.

Why This Time Is Different (MooTrades)

We have seen the last three bull markets catalyzed largely by loosening liquidity conditions during the bear markets that preceded them by central banks — in more and more of a globally coordinated fashion. This has led me to believe that the expansion of liquidity is the primary driver for consistent risk asset upward price revisions (aka bull markets). More than economic developments, earnings or political discourse. As a result it is crucial to realize that the ‘punch bowl’ of quantitative easing, the veritable liquidity spigot that juiced markets higher over the last 9.5 years, is not only running dry, but going in reverse (taking liquidity from markets). The impact of this reversal cannot overstated. It will be the primary catalyst that drives this bear market in equities lower. Only a reversal of tightening liquidity conditions will drive risk assets higher again.

Macro: • $1 of US GDP growth now costs $4 of debt, and is only growing as we push on the string of debt to borrow forward demand to today. • US now has $200 trillion of unfunded liabilities over the next 10 year period. • Debt monetization isn’t just important, it will become a necessity. Otherwise rates normalize and the party ends in a very bad way (insolvency and/or extreme austerity measures).

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Everybody is getting ready for a fight. Just not one that would benefit their voters.

Democrats Introduce Impeachment Articles On 1st Day In The House (RT)

Democrats are flexing their muscles as the incoming majority in the US House of Representatives, introducing articles of impeachment and even quixotic constitutional amendments even though they have no hope of passing. Rep. Brad Sherman (D-CA) introduced articles of impeachment on the first day of the 2019 Congress, starting with a resolution demanding President Donald Trump be impeached for “threatening, and then terminating” then-FBI Director James Comey in 2017. Reserving the option to introduce more articles later, Sherman told CNN he wanted to be able to “force the conversation on impeachment” when (if?) the Mueller report is released, “challenging” his Democratic colleagues who haven’t yet chosen to support Trump’s impeachment.

Sherman filed the exact same impeachment resolution in 2017 but could only muster one supporter, Rep. Al Green (D-TX), who later filed his own articles of impeachment. Rep. Rashida Tlaib (D-MI) didn’t even wait until she was seated as a congresswoman to go after the president’s job, publishing an op-ed on Thursday entitled “Now is the time to begin impeachment proceedings against President Trump.” “We already have overwhelming evidence that the president has committed impeachable offenses,” she wrote, accusing Trump of “abuse of power and abuse of the public trust” along with a laundry list of crimes. In person, she was even more direct, reportedly telling a MoveOn.org reception, “We’re gonna impeach that mother**ker.”

Speaker of the House Nancy Pelosi has been noticeably reticent on impeachment, telling NBC on Thursday that Democrats should wait for the Mueller report before making any moves. “We shouldn’t be impeaching for a political reason, and we shouldn’t avoid impeachment for a political reason,” she said. Many rank-and-file Democrats ran on pro-impeachment platforms, but with polls indicating only a third of Americans support the idea and a two-thirds majority in the Republican-controlled Senate required to remove the president, they are unlikely to make any sudden moves.

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“..there are almost 900 Canadians in a similar situation in the United States..”

Canada Says 13 Citizens Detained In China Since Huawei CFO’s Arrest (R.)

Canada has said 13 of its citizens have been detained in China since the Huawei executive Meng Wanzhou was arrested in December in Vancouver at the request of the US. “At least” eight of those 13 have since been released, a Canadian government statement said, without disclosing what charges if any had been laid. Prior to Thursday’s statement, detention of only three Canadian citizens had been publicly disclosed. Diplomatic tensions between Canada and China have escalated since Meng’s arrest on 1 December. The Canadian government has said several times it sees no explicit link between the arrest of Meng, the daughter of Huawei’s founder, and the detentions of Canadian citizens. But Beijing-based western diplomats and former Canadian diplomats have said they believe the detentions were a “tit-for-tat” reprisal by China.

Meng was released on a C$10m ($7.4m) bail on 11 December and is living in one of her two Vancouver homes as she fights extradition to the US. The 46-year-old executive must wear an ankle monitor and stay at home from 11pm to 6am. The 13 Canadians detained included Michael Kovrig, Michael Spavor and Sarah McIver, a Canadian government official said on Thursday. McIver, a teacher, has been released and returned to Canada. Kovrig and Spavor remain in custody. Canadian consular officials saw them once each in mid-December. Overall there are about 200 Canadians who have been detained in China for a variety of alleged infractions and continue to face on-going legal proceedings. “This number has remained relatively stable,” the official said. In comparison there are almost 900 Canadians in a similar situation in the United States, the official said.

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Who’s going to save Deutsche? It’s far too big not to be saved. But it would drag down any other bank with it. Let the German government do it.

UBS Chairman Pours Cold Water On Deutsche Bank Merger Talk (R.)

Swiss bank UBS is not looking to merge with any other bank, Chairman Axel Weber told the Tages-Anzeiger newspaper, dismissing speculation that UBS could join forces with Deutsche Bank. “There is a lot of talk in Europe and the United States about mergers but nothing happens. These are all simulation games,” he said in an interview published on Thursday. Asked specifically about whether UBS, the world’s largest wealth manager, was running simulations about Germany’s biggest lender, Weber said: “Every company has to think things over, but it makes little sense to consider mergers at group level now. These paralyze companies for years.

“UBS is much stronger today than before the financial crisis, but combining with another bank — no matter which — would be premature at this moment. We want to grow primarily organically and we surely have to be able to walk before we want to run.” Weber, a former Bundesbank chief who joined UBS in 2012, said he could imagine remaining in his post until 2022. Asked how long Chief Executive Sergio Ermotti might stay, he said UBS wanted an orderly leadership transition and was under no pressure to act while it ensured the right talent was in place.

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The Dutch finance minister published a list of tax havens a few days ago. Holland wasn’t on it. These people don’t give a sh*t about their credibility.

Google Shifted $23 Billion To Tax Haven Bermuda In 2017 (R.)

Google moved 19.9 billion euros ($22.7 billion) through a Dutch shell company to Bermuda in 2017, as part of an arrangement that allows it to reduce its foreign tax bill, according to documents filed at the Dutch Chamber of Commerce. The amount channeled through Google Netherlands Holdings BV was around 4 billion euros more than in 2016, the documents, filed on Dec. 21, showed. “We pay all of the taxes due and comply with the tax laws in every country we operate in around the world,” Google said in a statement. “Google, like other multinational companies, pays the vast majority of its corporate income tax in its home country, and we have paid a global effective tax rate of 26 percent over the last ten years.”

For more than a decade the arrangement has allowed Google owner Alphabet to enjoy an effective tax rate in the single digits on its non-U.S. profits, around a quarter the average tax rate in its overseas markets. The subsidiary in the Netherlands is used to shift revenue from royalties earned outside the United States to Google Ireland Holdings, an affiliate based in Bermuda, where companies pay no income tax. The tax strategy, known as the “Double Irish, Dutch Sandwich”, is legal and allows Google to avoid triggering U.S. income taxes or European withholding taxes on the funds, which represent the bulk of its overseas profits.

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“76% of Tory members said that warnings about no deal Brexit — like those on food & medicine — are “exaggerated or invented, and in reality leaving without a deal would not cause serious disruption.”

Over Half Of Tory Members Consider Quitting Party Over May’s Brexit Deal (BI)

Conservative party members overwhelmingly want MPs to vote down Theresa May’s Brexit deal, with more than half saying they have even considered ripping up their membership over it, according to a new poll. A survey of 1,215 Tory party members published on Friday found that 59% of Conservative party members oppose the Withdrawal Agreement May has negotiated with the European Union, while just 38% support it. Among all Conservative party members, more than half (56%) said they had considered quitting the party over May’s deal, according to YouGov polling for leading academics at the ESRC-funded Party Members Project.

The findings will spook figures in Downing Street who had hoped that Conservative MPs would return from their constituencies over Christmas having been urged by party members to get behind May and her deal. The prime minister was forced to postpone a parliamentary vote on her deal after more than 100 of her MPs announced that they planned to oppose it. [..] The Tory party membership is particularly supportive of leaving the EU without a deal, despite the myriad warnings from ministers about the disruption it would cause across multiple aspects of life in the UK, including food and medicine. A whopping 76% of Tory members said that warnings about a no deal Brexit are “exaggerated or invented, and in reality leaving without a deal would not cause serious disruption.” Just 18% said the warnings were realistic.

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The -legal- power of Monsanto should never be underestimated.

US Judge Limits Evidence In Trial Over Roundup Cancer Claims (R.)

A federal judge overseeing lawsuits alleging Bayer’s glyphosate-based weed killer causes cancer has issued a ruling that could severely restrict evidence that the plaintiffs consider crucial to their cases. U.S. District Judge Vince Chhabria in San Francisco in an order on Thursday granted Bayer unit Monsanto’s request to split an upcoming trial into two phases. The order initially bars lawyers for plaintiff Edwin Hardeman from introducing evidence that the company allegedly attempted to influence regulators and manipulate public opinion.

Thursday’s order applies to Hardeman’s case, which is scheduled to go to trial on Feb. 25, and two other so-called bellwether trials which will help determine the range of damages and define settlement options for the rest of the 620 Roundup cases before Chhabria. But Hardeman’s lawyers contended that such evidence, including internal Monsanto documents, showed the company’s misconduct and were critical to California state court jury’s August 2018 decision to award $289 million in a similar case. The verdict sent Bayer shares tumbling though the award was later reduced to $78 million and is under appeal. Under Chhabria’s order, evidence of Monsanto’s alleged misconduct would be allowed only if glyphosate was found to have caused Hardeman’s cancer and the trial proceeded to a second phase to determine Bayer’s liability.

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Time to cut all ties with Brazil.

New Brazil President Bolsonaro Launches Assault On Amazon Rainforest (G.)

Hours after taking office, Brazil’s new president, Jair Bolsonaro, has launched an assault on environmental and Amazon protections with an executive order transferring the regulation and creation of new indigenous reserves to the agriculture ministry – which is controlled by the powerful agribusiness lobby. The move sparked outcry from indigenous leaders, who said it threatened their reserves, which make up about 13% of Brazilian territory, and marked a symbolic concession to farming interests at a time when deforestation is rising again. “There will be an increase in deforestation and violence against indigenous people,” said Dinaman Tuxá, the executive coordinator of the Articulation of Indigenous People of Brazil (Apib).

“Indigenous people are defenders and protectors of the environment.” Sonia Guajajara, an indigenous leader who stood as vice-presidential candidate for the Socialism and Freedom party (PSOL) tweeted her opposition. “The dismantling has already begun,” she posted on Tuesday. Previously, demarcation of indigenous reserves was controlled by the indigenous agency Funai, which has been moved from the justice ministry to a new ministry of women, family and human rights controlled by an evangelical pastor. The decision was included in an executive order which also gave Bolsonaro’s government secretary potentially far-reaching powers over non-governmental organizations working in Brazil.

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May 092018
 


Edgar Degas Two laundresses 1876

 

Fed Chair Powell To Emerging Markets: You Are On Your Own (ZH)
Argentina Seeks IMF Aid ‘To Avoid Crisis’ (BBC)
Europe On Collision Course With US Over Iran Deal (AFP)
Mnuchin: Revoking Boeing, Airbus Licenses To Sell Jets To Iran (R.)
Pompeo, In North Korea, To Return With Detained Americans (R.)
Central Banks Rigged The Cost Of Money And The State Of The Markets (Prins)
US Student Debt Just Hit $1.5 Trillion (MW)
The State of the American Debt Slaves, Q1 2018 (WS)
UK PM May Suffers Upper House Defeat Over Plans To Leave EU Single Market (R.)
UK Retailers Suffer Sharpest Sales Drop For 22 Years In April (G.)
Sharp Drop In UK Retail Job Vacancies As High Street Crisis Deepens (Ind.)
Cynthia Nixon: Marijuana Industry Could Be ‘A Form Of Reparations’ (Hill)
Record Drop In Greek Savings Last Year (K.)
Debt Repayment Feasible if Greece ‘Implements Reforms’ – Regling (AMNA)
British Diplomats: Saving The Rainforest Could Hurt Fighter Jet Sales (UE)

 

 

As the dollar keeps rising.

Fed Chair Powell To Emerging Markets: You Are On Your Own (ZH)

Over the weekend, when commenting on the ongoing rout in emerging markets, Bloomberg published an article titled “Rattled Emerging Markets Say: It’s Over to You, Central Bankers.” Well, overnight the most important central banker of all, Fed Chair Jay Powell responded to these pleas to “do something”, and it wasn’t what EMs – or those used to being bailed out by the Fed – wanted to hear. As Powell explained, speaking at a conference sponsored by the IMF and Swiss National Bank in Zurich, the Fed’s gradual push towards higher interest rates shouldn’t be blamed for any roiling of emerging market economies – which are well placed to navigate the tightening of U.S. monetary policy. In other words, with the Fed’s monetary policy painfully transparent, Powell’s message to EM’s was simple: “you’re on your own.”

Arguing that the Fed’s decision-making isn’t the major determinant of flows of capital into developing economies (which, of course, it is especially as the Fed gradually reverses the biggest monetary experiment in history) Powell said the influence of the Fed on global financial conditions should not be overstated, despite Bernanke taking the blame five years ago for the so-called taper tantrum. “There is good reason to think that the normalization of monetary policy in advanced economies should continue to prove manageable for EMEs,” Powell said, adding that “markets should not be surprised by our actions if the economy evolves in line with expectations.”

[..] Meanwhile, as the Fed refuses to change course, other policy makers have been forced to step in to counter the sharp, sudden capital outflows, with Argentina’s central bank abruptly raising rates three times, to 40% to halt a sell-off in the peso. Russia has also put the brakes on further monetary easing. Turkey, which is a unique basket case in that Erdogan is expressly prohibiting the central bank from doing the one thing it should to ease the ongoing panic, i.e., raise rates, is seeking to bring down its current account deficit. Overnight, we learned that Indonesia was burning reserves to prop up its currency.

Meanwhile, also overnight, JPM CEO Jamie Dimon said it’s possible U.S. growth and inflation prove fast enough to prompt the Fed to raise interest rates more than many anticipate, and it would be wise to prepare for benchmark yields to climb to 4%. Such a scenario would be a disaster for EMs: “A sustained move higher would pressure local currencies and lure away foreign investors. The IMF warned last month that risks to global financial stability have increased over the past six months.” “Central banks may have to respond with interest rate hikes if the sell-off intensifies,” said Chua Hak Bin, a senior economist at Maybank Kim Eng Research in Singapore. Those most vulnerable include Ukraine, China, Argentina, South Africa and Turkey according to the Institute for International Finance.

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IMF demand: austerity. Back to the hoovervilles.

Argentina Seeks IMF Aid ‘To Avoid Crisis’ (BBC)

Argentina is to start talks about a financing deal with the International Monetary Fund (IMF) on Wednesday amid reports it is seeking $30bn (£22bn). Finance minister Nicolas Dujovne is due to fly to the IMF’s Washington offices. After recent turmoil that saw interest rates hit 40%, President Mauricio Macri said IMF aid would “strengthen growth” and help avoid crises of the past. The talks come 17 years after Argentina defaulted on its debts and 12 years since it severed ties with IMF. Mr Macri said in an address to the nation on Tuesday: “Just a few minutes ago I spoke with (IMF) director Christine Lagarde, and she confirmed we would start working on an agreement.”

“This will allow us to strengthen our program of growth and development, giving us greater support to face this new global scenario and avoid crises like the ones we have had in our history,” he said. Local media and Bloomberg reported that Argentina was seeking $30bn, although the government declined to comment. The peso has lost a quarter of its value in the past year amid President Macri’s pro-market reforms. Last week the central bank raised interest rates from 33.25% to 40%. Many people still blame IMF austerity requirements for policies that led to a financial and economic meltdown in 2001 to 2002 that left millions of middle class Argentines in poverty. Argentina eventually defaulted on its debts. And although its last IMF loan was paid down in 2006, the country severed ties with the Washington-based body.

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“US sanctions will target critical sectors of Iran’s economy. German companies doing business in Iran should wind down operations immediately,” tweeted the US ambassador in Berlin, Richard Grenell.

Europe On Collision Course With US Over Iran Deal (AFP)

Donald Trump’s decision to pull out of the landmark 2015 deal curbing Iran’s nuclear programme is a bitter pill to swallow for European leaders and risks a creating a major transatlantic rift. French President Emmanuel Macron, who has spent the past year cultivating the closest ties with Trump among EU leaders, made saving the Iran deal one of his priorities during his state visit to Washington last month. German Chancellor Angela Merkel had also travelled to the US in late April and she worked closely with Macron and British Prime Minister Theresa May right up to the last minute.

In a joint statement issued shortly after Trump walked away from 2015 accord, they said they noted the decision with “regret and concern” but they said they would continue to uphold their commitments. “Our governments remain committed to ensuring the agreement is upheld, and will work with all the remaining parties to the deal to ensure this remains the case,” they said. They noted that this included the “economic benefits to the Iranian people that are linked to the agreement,” which means European firms would in theory continue to invest and operate there. This would appear to set the three countries, all signatories along with Russia, China and the EU, on a direct collision course with Washington.

European leaders have clashed with the White House already on issues ranging from climate change to trade and Trump’s decision to move the US embassy in Israel to Jerusalem. Trump’s hawkish National Security Advisor John Bolton said that European firms would have a “wind down” period to cancel any investments made in Iran under the terms of the accord. “US sanctions will target critical sectors of Iran’s economy. German companies doing business in Iran should wind down operations immediately,” tweeted the US ambassador in Berlin, Richard Grenell. Under the 2015 deal, Iran was meant to benefit from increased trade and contracts with foreign firms in exchange for accepting curbs on its nuclear activity and stringent monitoring.

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Airbus? But it’s European. Oh: “All the deals are dependent on U.S. licenses because of the heavy use of American parts in commercial planes.”

Mnuchin: Revoking Boeing, Airbus Licenses To Sell Jets To Iran (R.)

Licenses for Boeing Co and Airbus to sell passenger jets to Iran will be revoked, U.S. Treasury Secretary Steven Mnuchin said on Tuesday after President Donald Trump pulled the United States out of the 2015 Iran nuclear agreement. Trump said he would reimpose U.S. economic sanctions on Iran, which were lifted under the agreement he had harshly criticized. The pact, worked out by the United States, five other world powers and Iran, lifted sanctions in exchange for Tehran limiting its nuclear program. It was designed to prevent Iran from obtaining a nuclear bomb. IranAir had ordered 200 passenger aircraft – 100 from Airbus SE, 80 from Boeing and 20 from Franco-Italian turboprop maker ATR.

All the deals are dependent on U.S. licenses because of the heavy use of American parts in commercial planes. Boeing agreed in December 2016 to sell 80 aircraft, worth $17 billion at list prices, to IranAir under an agreement between Tehran and major world powers to reopen trade in exchange for curbs on Iran’s nuclear activities. The U.S. Treasury Department, which controls licensing of exports, said the United States would no longer allow the export of commercial passenger aircraft, parts and services to Iran after a 90-day period. “The Boeing and (Airbus) licenses will be revoked,” Mnuchin told reporters at the Treasury. “Under the original deal, there were waivers for commercial aircraft, parts and services and the existing licenses will be revoked.”

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Are they going to say they were well treated?

Pompeo, In North Korea, To Return With Detained Americans (R.)

U.S. Secretary of State Mike Pompeo is expected to return from North Korea with three American detainees, as well as details of an upcoming summit between leader Kim Jong Un and U.S. President Donald Trump, a South Korean official said on Wednesday. Pompeo arrived in Pyongyang on Wednesday from Japan and headed to the Koryo Hotel in the North Korean capital for meetings, a U.S. media pool report said. Trump earlier broke the news of Pompeo’s second visit to North Korea in less than six weeks and said the two countries had agreed on a date and location for the summit, although he stopped short of providing details. An official at South Korea’s presidential Blue House said Pompeo was expected to finalize the date of the summit and secure the release of the three American detainees.

While Trump said it would be a “great thing” if the American detainees were freed, Pompeo told reporters en route to Pyongyang he had not received such a commitment but hoped North Korea would “do the right thing”. “We’ll talk about it again today,” he said. “I think it’d be a great gesture if they would choose to do so.” The pending U.S.-North Korea summit has sparked a flurry of diplomacy, with Japan, South Korea and China holding a high-level meeting on Wednesday. Chinese Premier Li Keqiang said concerned parties should seize the opportunity to promote denuclearization of the Korean peninsula, the official Xinhua news agency reported.

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More Nomi.

Central Banks Rigged The Cost Of Money And The State Of The Markets (Prins)

Nomi Prins: The word “collusion” has come to be associated with Russia, Trump and the US election. My book is about something entirely different, much more global: the collusion (or coordination) that the US central bank (the Federal Reserve) forged with other major countries to fabricate an abundance of money in the wake of the 2008 financial crisis to support the US financial system at first, and banks and select companies and markets worldwide, as well, since. The Fed conjured up this money to provide liquidity for Wall Street banks. The policy was then exported to the major central banks who acted as a lender and supplier of last resort to the world.

Some of the most notable central banks include the European Central Bank (ECB), the Bank of Japan and the Bank of England. Collusion is about these powerful institutions’ relationships with each other. The book dives into how central banks rigged the cost of money and the state of the markets, and ultimately created more inequality and instability as a result. They did all of this in order to subsidize private banks at the expense of people everywhere. The book reveals the people in charge of these strategies, their elite gatherings and public and private communications. It uncovers how their policies rerouted economies, geopolitics, trade wars and elections.

How do central banks relate to the world’s markets? Central banks have several functions from an official standpoint. The first is to regulate the smooth and orderly operation of private banks or public banks within a particular country or region (the ECB is responsible for many countries in Europe). The other function they are tasked with is setting interest rates (the cost of borrowing money) so that there’s adequate economic balance between full employment and a select inflation rate. The idea is that if the cost of money is cheap enough, private banks will lend to the general population and businesses. The ultimate goal is that the money can be used to expand enterprise, hire people and develop a strong economic posture.

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What cannot be repaid will not be.

US Student Debt Just Hit $1.5 Trillion (MW)

America’s student loan problem just surpassed a depressing milestone. Outstanding student debt reached $1.521 trillion in the first quarter of 2018, according to the Federal Reserve, hitting $1.5 trillion for the first time. Though the marker is somewhat arbitrary, it offers a reminder of how quickly student debt has grown—jumping from about $600 billion 10 years ago to more than $1.5 trillion today—and that the factors fueling the increase aren’t likely to disappear any time soon. “People pay attention to milestones,” said Mark Kantrowitz, a financial aid expert. When student debt surpassed $1 trillion in 2012, “it definitely caused a shift in coverage of student loans in the news media,” he said.

In theory, that helps raise awareness of the issue for student advocates, lawmakers and, in particular, borrowers when considering what college to attend. But Kantrowitz added, “What’s more important is the impact on individual borrowers.” And they are feeling it. College graduates leave school with about $37,000 in debt on average, according to Kantrowitz’s data, a sum that can be bearable for many, given that the average starting salary for a new college graduate last year hovered around $50,000. But a large share—as many as one in six college graduates, Kantrowitz estimates—will leave school with debt that exceeds their income. That will make it challenging for those borrowers to pay off their loans on a standard 10-year repayment plan, he said.

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Now let’s throw in some rate hikes, see what happens.

The State of the American Debt Slaves, Q1 2018 (WS)

Total consumer credit rose 5.1% in the first quarter, compared to a year earlier, or by $184 billion, to $3.824 trillion (not seasonally adjusted), according to the Federal Reserve. This includes credit-card debt, auto loans, and student loans, but not mortgage-related debt. That 5.1% year-over-year increase isn’t setting any records – in 2011, year-over-year increases ran over 11%. But it does show that Americans are dealing with the economy and their joys and woes the American way: by piling on debt faster than the overall economy is growing. The chart below shows the progression of consumer debt since 2006. In line with seasonal patterns for first quarters, consumer credit (not seasonally adjusted) edged down from Q4, as the spending binge of the holiday shopping season turned into hangover, an annual American ritual:

Note how the dip after the Financial Crisis – when consumers deleveraged mostly by defaulting on those debts – didn’t last long. Over the 10 years since Q1 2008, consumer debt has now surged 47%. Over the same period, the consumer price index has increased 16.9%: Auto loans and leases for new and used vehicles rose by 3.8% from a year ago, or by $41 billion, to $1.118 trillion. It was one of the smaller increases since the Great Recession: The peak year-over-year jumps occurred at the peak of the new vehicle sales boom in the US in Q3 2015 ($87 billion or 9%). However, the still standing records were set in Q1 and Q2 2001 near the end of the recession, with each quarter adding around $93 billion, or 16%, year-over-year.

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It really makes no difference; the EU will say no anyway to all plans acceptable to the UK.

UK PM May Suffers Upper House Defeat Over Plans To Leave EU Single Market (R.)

Britain’s upper house of parliament on Tuesday inflicted another embarrassing defeat on Prime Minister Theresa May’s government on Tuesday, challenging her plan to leave the European Union’s single market after Brexit. May, who has struggled to unite the government behind her vision of Brexit, has said Britain will also leave the European Union’s single market and customs union after it quits the bloc next March. That stance has widened divisions not only within her own Conservative Party but also across both houses of parliament, which like Britons at large, remain deeply split over the best way to leave the EU after more than four decades of membership.

By a vote of 245 to 218, the unelected upper chamber, the House of Lords, supported an amendment to her Brexit blueprint, the EU withdrawal bill, requiring ministers to negotiate continued membership of the European Economic Area, meaning that it would remain in the single market. “The time has come over Brexit, really, for economic reality and common sense to prevail over political dogma and wishful thinking,” said Peter Mandelson, a member of the House of Lords from the main opposition Labour Party, who backed the amendment.

His comments drew criticism from pro-Brexit peers, including Conservative member Michael Forsyth who described the amendment as part of an attempt by “a number of people in this house who wish to reverse the decision of the British people”. Those proposing the amendment deny the charge. This is the 13th time in recent weeks that the government has been defeated in the House of Lords on the draft legislation that will formally terminate Britain’s EU membership.

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Must have been the weather.

UK Retailers Suffer Sharpest Sales Drop For 22 Years In April (G.)

Britain’s retailers suffered the sharpest drop in business in more than two decades last month as bad weather, the squeeze on household budgets and the timing of Easter led to a hefty cut in consumer spending. In the latest evidence of the slowdown in the economy since the turn of the year, the latest health check from the British Retail Consortium (BRC) and KPMG found that sales were down by 3.1% in April, the biggest decline since the survey was launched in 1995. Spending on non-food items has been particularly hard hit over the last three months, and retailers are braced for tough trading conditions to continue for the rest of the year even though wages have now started to rise more quickly than prices.

Retailers have been hit hard by a combination of problems on top of the squeeze on spending, including higher labour costs as a result of increases in the minimum wage, the shift to online shopping and rapidly changing spending patterns. Toys R Us and the electricals retailer Maplin collapsed in February and a number of retailers, including House of Fraser, New Look, Carpetright and Poundworld, are all pursuing agreements with their landlords to cut their rents and close stores. The industry had been expecting that year-on-year comparisons would look poor for April, but the BRC’s chief executive, Helen Dickinson, said the problem ran deeper.

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Pickers and packers.

Sharp Drop In UK Retail Job Vacancies As High Street Crisis Deepens (Ind.)

Wages rose in April amid strong demand for candidates, but the number of retail vacancies dropped sharply as the crisis on the high street worsened, a recruitment industry survey has found. Growth of overall job vacancies picked up to a three-month high in April, the Recruitment and Employment Confederation said. Demand for permanent staff increased in the “vast majority” of job categories during the month, with the notable exception of retail, the REC said. The study of 400 recruitment consultancies found that engineering and IT saw the steepest increases in vacancies. REC director of policy Tom Hadley said the high-profile struggles of many retailers indicated it was a good time for staff to consider how they could transfer their skills into other roles, such as in the technology sector or as pickers and packers in distribution centres. “Helping people make career transitions will become increasingly important in this fast-changing business and employment landscape,” he said.

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Smart.

“..In New York in 2017, 86% of fifth-degree marijuana arrests were of people of color, while only 9% of those arrested were white..”

Cynthia Nixon: Marijuana Industry Could Be ‘A Form Of Reparations’ (Hill)

New York gubernatorial candidate and actress Cynthia Nixon on Saturday expanded on her calls for marijuana legalization, saying that the industry could provide a form of “reparations” for communities of color. Nixon, who expressed her support for legalizing marijuana earlier this year, told Forbes that she views marijuana as a racial justice issue. “We’re incarcerating people of color in such staggering numbers,” she said. She expressed support for what is known as an “equity” program, which would prioritize giving marijuana business licenses to people who have received marijuana convictions in the past. “Now that cannabis is exploding as an industry, we have to make sure that those communities that have been harmed and devastated by marijuana arrests get the first shot at this industry,” she told Forbes.

“We [must] prioritize them in terms of licenses. It’s a form of reparations.” In New York in 2017, 86% of fifth-degree marijuana arrests were of people of color, while only 9% of those arrested were white, despite data showing that black and white people are about equally likely to use marijuana. “Arresting people — particularly people of color — for cannabis is the crown jewel in the racist war on drugs and we must pluck it down,” she said. “We must expunge people’s records; we must get people out of prison.” “The use of marijuana has been effectively legal for white people for a really long time,” she told Forbes. “It’s time that we legalize it for everybody else.”

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Everything keeps going down. It’s guaranteed.

Record Drop In Greek Savings Last Year (K.)

Household savings shrank by 32.5 billion euros in total in the period from 2011 to 2017, as families increasingly resorted to dipping into their deposits after finding that disposable incomes are no longer enough to cover their outgoings. Last year the drop in savings reached an historic high of 8.3 billion euros in current prices, according to an analysis by Eurobank. In addition, households have resorted to liquidating assets such as properties, deposits, shares and bonds, among other investments. Notably consumption shrank by almost a quarter from 2008 to 2017, falling from 163.3 billion euros to 123.3 billion last year, which was the sixth in a row with negative savings for Greek households; this means that disposable income was less than consumption.

Eurobank data showed that the wealth of the country’s households has been in constant decline since 2011, falling at an average rate of 6.6 billion euros per year, which is transformed from various forms of savings into consumption. The report by Eurobank’s analysis department highlighted that the economic recession, the stagnation in investments and the major fiscal adjustment Greece experienced from 2009 to 2017 have compressed households’ saving capacity, both in terms of incomes and their obligations to the state through taxes and social security contributions.

The figures reveal that Greek households’ net annual savings amounted to 11.4 billion euros in 2009, or 7% of their gross disposable income, while last year the balance was negative by 8.3 billion, or 6.7% of households’ gross disposable income. Shrinking private consumption has had a direct impact on investments: In 2009 investments had amounted to 18.3% of GDP and were 31.8% funded by domestic consumption and the rest from borrowing. In 2017 the investment rate slipped to 11.6% of GDP, with domestic consumption accounting for 91.1%.

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Delusional or lying to our faces?

Debt Repayment Feasible if Greece ‘Implements Reforms’ – Regling (AMNA)

“If the government in Athens implements all the remaining reforms decisively, Greece can successfully emerge from the ESM program in August 2018,” Klaus Regling, president of the European Stability Mechanism, has said. The ESM chief spoke at en event held in Aachen, Germany on the occasion of the awarding of the 60th International Charlemagne Prize to French President Emmanuel Macron. Regling expressed confidence that Greece could repay its loans, provided the maturity times are sufficiently extended and the obligations do not exceed 15-20% of the country’s economic performance. The ESM chief said that if the latest report on Greece’s bailout program is positive, there will be a final disbursement from the ESM, and then decisions will be made on possible further debt relief.

He argued that there was absolutely no alternative to the establishment of the rescue mechanism, without which, as he said, Greece, Portugal and Ireland would have probably come out of Economic and Monetary Union under “chaotic conditions,” while at the same time other countries such as Germany, would have problems. Regling also stressed that ESM interest rates are clearly below the level that countries would have to pay in the markets, and that is why they save a lot of money. In the case of Greece, “we estimate that ESM loans lead to savings of almost €10 billion [$11.8 billion] each year for the Greek budget”, he said and stressed that this is happening costing nothing to the European taxpayer.

“These savings are an expression of the solidarity shown by the member states of the euro zone,” he said, and referred to “great efforts” that Greece is making to fulfill the strict reform conditions. “Overall, Greece now has impressive adaptation efforts behind it. The budget deficit at the start of the 2009 crisis was above 15% of GDP. For two years, the country has been generating a budget surplus. Such a success is only possible with profound reforms,” Regling noted and said that if Greece implements all reforms, eurozone finance ministers would give Greece further debt relief, namely longer repayment times.

Finally, explaining the reasons why Greece remains in a program while the other countries have completed their own, referred to the country as a “special case” for three reasons: “Firstly, the Greek economy has had problems that are deeper rooted than for other countries in a program. Secondly, the country suffered from a much weaker public administration than the other eurozone member states. “And thirdly, the Greek government in the first half of 2015 went in the wrong direction with then finance minister (Yanis Varoufakis): major reforms were revoked and an effort was made to stop the agreed reform program. “As a result, the Greek economy had fallen into a recession. Grexit suddenly became a realistic scenario. The Bank of Greece estimates that this wrong move cost Greece €86 billion.”

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How we think.

British Diplomats: Saving The Rainforest Could Hurt Fighter Jet Sales (UE)

British government officials warned a proposed EU ban on palm oil in biofuels could harm UK defence sales to Malaysia, specifically Typhoon fighter jets, according to government emails obtained by Unearthed. The correspondence reveals that the British high commission in Kuala Lumpur even expected Malaysian Prime Minister Najib Razak to lobby Theresa May personally on the issue at last month’s Commonwealth Heads of Government meeting. In the event, Razak did not attend the meeting in London, a Number 10 spokeswoman told Unearthed. Correspondence between the Ministry of Defence, the Department for Environment, Food and Rural Affairs and the British high commission reveals British officials were concerned that EU moves to ban palm oil in biofuels could result in Malaysian trade reprisals against the UK.

MEPs voted in January to phase out the use of palm oil in biofuels, citing environmental concerns. The move sparked a furious response from the governments of Indonesia and Malaysia, which produce most of the world’s palm oil. The debate over palm oil is playing a significant role in the run-up to Malaysia’s general election, which will be held tomorrow. On the morning of 5 February, an official at the British high commission in Malaysia sent an email warning that the EU decision was “a big issue for Malaysia and, if not handled correctly, has the potential to impact on bilateral trade, particularly defence sales (Typhoon)”.

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Apr 062018
 
 April 6, 2018  Posted by at 9:11 am Finance Tagged with: , , , , , , , , , , , ,  


Edgar Degas Leaving the paddock 1866
Stolen from Gardner Museum March 18 1990, the single largest art theft in the world. Never recovered

 

US Willing To Talk Trade With China, No Session Set Yet (R.)
Trump Considers New $100 Billion Tariffs On Chinese Goods (G.)
Trade Is a Matter of Survival for China (Rickards)
Facebook Explored Data Sharing Agreement With Hospitals (CNBC)
Uber To Suspend Service In Greece After New Legislation (R.)
HSBC Whistleblower Released By Judge After Swiss Extradition Request (Ind.)
German Court Says Carles Puigdemont Can Be Released On Bail (G.)
Young People In Britain Have Never Been Unhappier (G.)
Elderly People Grow As Many New Brain Cells As Young (Ind.)
Surgeon General Urges More Americans To Carry Opioid Antidote (CNN)
Social Media Looks Like the New Opiate of the Masses (BBG)
Lifting Sugarcane Farming Ban ‘Last Straw’ For Amazon Rainforest (Ind.)
Bolivia’s Jaguars Under Threat Of Chinese Fang Craze (AFP)

 

 

Get around a table alright.

US Willing To Talk Trade With China, No Session Set Yet (R.)

The United States is willing to negotiate with China on trade, but only if talks are serious, as previous attempts produced little progress, a senior U.S. official told Reuters late on Thursday as trade tensions between the two nations escalated. No formal negotiating sessions have been set, the official said. “There is ongoing communications with the Chinese on trade,” said the official, who requested anonymity to discuss the Trump administration’s trade strategy. The official said Republican President Donald Trump, who has already sought $50 billion in new tariffs on China, will insist on “verifiable, enforceable and measurable deliverables” from China in any trade negotiations.

The comments came as Trump said late on Thursday he had instructed U.S. trade officials to consider $100 billion in additional tariffs on China “in light of China’s unfair retaliation” against earlier U.S. trade actions. In a statement, Trump said the U.S. Trade Representative had determined that China “has repeatedly engaged in practices to unfairly obtain America’s intellectual property.” The senior official said: “We’ve had a type of negotiation in different forums where China has made lots of different commitments that they haven’t followed through on. “We don’t want to go down that path. But the president has been clear, the administration has been clear, we’re not trying to start a trade war. We’re simply trying to get fair and reciprocal treatments so we’re open to those conversations.”

The official said China had committed seven times to stopping forced technology transfers, a practice in which China allegedly seeks to obtain U.S. intellectual property (IP) through joint venture requirements, something that China denies. “This president is not going to tolerate hollow commitments or refusal to change bad practices. And if the way that we effectuate that is through negotiations, that’s great,” the official said.

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All still just proposals. Waiting for Chinese replies that are not threats.

Trump Considers New $100 Billion Tariffs On Chinese Goods (G.)

Donald Trump has instructed the US trade representative to consider slapping $100bn in additional tariffs on Chinese goods in an escalating standoff over trade. Trump said in a statement on Thursday that the further tariffs were being considered “in light of China’s unfair retaliation” against earlier US trade actions. He added that the US trade representative had determined that China “has repeatedly engaged in practices to unfairly obtain America’s intellectual property”. The White House said Trump had instructed the Office of the United States Trade Representative, the agency responsible for developing and recommending trade policy, to consider whether the additional tariffs would be appropriate under section 301 and, if so, to identify which products they should apply to.

He’s also instructed his secretary of agriculture “to implement a plan to protect our farmers and agricultural interests”. “Rather than remedy its misconduct, China has chosen to harm our farmers and manufacturers”, Trump said. Trump argues China’s trade practices have led to the closure of American factories and the loss of millions of American jobs. On Friday China’s commerce ministry said Beijing would fight the US ‘at any cost’. China’s state-run tabloid Global Times called Trump’s latest threat “ridiculous” in an editorial on Thursday, noting that it “reflects the deep arrogance of some American elites in their attitude towards China.”

Trump’s move comes one day after China issued a $50bn list of US goods including soybeans and small aircraft for possible tariff hikes. That itself was 11 hours after the White House announced a list of 1,333 Chinese imports, also worth about $50bn, for punitive tariffs of 25%.

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Jim Rickards with a good history of US Presidential powers, but also of what China is afraid of: the homefront.

Trade Is a Matter of Survival for China (Rickards)

President Trump may now use IEEPA to block a variety of Chinese deals in the U.S. in retaliation for Chinese theft of U.S. intellectual property. With the U.S. using its nuclear option in financial warfare, investors should hope that the Chinese don’t respond in kind. President Trump may not appreciate the extent to which China will go to protect its interests. Trade negotiations are not the art of the deal, as far as China is concerned. Their goal is national survival. China’s economy is not just about providing jobs, goods and services that people want and need. It is about regime survival for a Chinese Communist Party that faces an existential crisis if it fails to deliver. The overriding imperative of the Chinese leadership is to avoid societal unrest.

[..] given China’s current economic problem, Beijing’s challenge is becoming more difficult every day. Consider what’s happening in China right now… Growth in GDP is conventionally defined as the sum of consumer spending, investment, government spending (excluding transfer payments) and net exports. Most large economies other than oil-producing nations get most of their growth from consumption, followed by investment, with relatively small contributions from government spending and net exports. A typical composition would show a 65% contribution from consumption plus a 15% contribution from investment. China is nearly the opposite, with about 35% from consumption and 45% from investment.

That might be fine in a fast-growing emerging-market economy like China if the investment component were carefully designed to produce growth in the future as well as short-term jobs and inputs. But that’s not the case. Up to half of China’s investment is a complete waste. It does produce jobs and utilize inputs like cement, steel, copper and glass. But the finished product, whether a city, train station or sports arena, is often a white elephant that will remain unused.

What’s worse is that these white elephants are being financed with debt that can never be repaid. And no allowance has been made for the maintenance that will be needed to keep these white elephants in usable form if demand does rise in the future, which is doubtful. Chinese growth has been reported in recent years as 6.5–10% but is actually closer to 5% or lower once an adjustment is made for the waste. The Chinese landscape is littered with “ghost cities” that have resulted from China’s wasted investment and flawed development model. This wasted infrastructure spending is the beginning of the debt disaster that is coming soon. China is on the horns of a dilemma with no good way out.

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It gets harder to act innocent. Why do this in secret if it is to benefit people?

Facebook Explored Data Sharing Agreement With Hospitals (CNBC)

Facebook has asked several major U.S. hospitals to share anonymized data about their patients, such as illnesses and prescription info, for a proposed research project. Facebook was intending to match it up with user data it had collected, and help the hospitals figure out which patients might need special care or treatment. The proposal never went past the planning phases and has been put on pause after the Cambridge Analytica data leak scandal raised public concerns over how Facebook and others collect and use detailed information about Facebook users. “This work has not progressed past the planning phase, and we have not received, shared, or analyzed anyone’s data,” a Facebook spokesperson told CNBC.

But as recently as last month, the company was talking to several health organizations, including Stanford Medical School and American College of Cardiology, about signing the data-sharing agreement. While the data shared would obscure personally identifiable information, such as the patient’s name, Facebook proposed using a common computer science technique called “hashing” to match individuals who existed in both sets. Facebook says the data would have been used only for research conducted by the medical community.

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Just make it local. And use the revenues to support your own cities.

Uber To Suspend Service In Greece After New Legislation (R.)

Ride-hailing service Uber said on Thursday it would suspend its licensed service in Greece after the approval of local legislation which imposes stricter regulation on the sector. Uber, which operates a licensed service in the Greek capital, has faced opposition from local taxi drivers who accuse it of taking their business. “New local regulations were voted on recently with provisions that impact ride-sharing services,” Uber said in a blog post. “We have to assess if and how we can operate within this new framework and so will be suspending uberX in Athens from next Tuesday until we can find an appropriate solution.” Uber operates two services in Athens: UberX, which uses professional licensed drivers, and UberTAXI, which uses taxi drivers.

The new regulations require each trip to start and end in the fleet partner’s designated headquarters or parking area, something Uber does not do. A digital registry of all ride-sharing platforms and their passengers will also be created. The company launched in Europe in 2011, angering some local authorities and taxi drivers who said it did not abide by the same rules on insurance, licensing and safety. Following widespread protests, court battles and bans, Uber has taken a more emollient stance under its new CEO Dara Khosrowshahi, suspending operations in various cities in order to comply with local regulations. UberX launched in Athens in 2015 and more than 450,000 people have used its smartphone app to book a ride.

News of the new regulation last year angered some Athenians and tens of thousands signed a petition launched by Beat – a local ride-sharing service – in favor of ride-hailing services. UberX drivers have to be employed by fleet partners such as car rental companies or tourist agencies and their cars could not be more than seven years old. The data registry and return-to-garage requirement will only apply to ride-hailing services like Uber and Beat, while taxi drivers will be able to use cars that are up to 22 years old.

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Too much backlash?!

HSBC Whistleblower Released By Judge After Swiss Extradition Request (Ind.)

An HSBC whistleblower who leaked data that led to a tax evasion scandal has been released by a Spanish judge after being arrested on an extradition request from Switzerland. Hervé Falciani, a former IT worker at HSBC’s secretive Swiss bank, faces a five-year prison sentence in Switzerland after being convicted in absentia for industrial sabotage in 2015. Police arrested Mr Falciani in Madrid on Wednesday on his way to speak at a conference on whistleblowing. Swiss authorities had requested that he be remanded in custody but he was released without bail on Thursday and ordered to surrender his passport while Spanish authorities consider whether to extradite him.

In 2008, Mr Falciani fled Switzerland, having stolen data on 130,000 HSBC clients, many of whom he suspected of tax evasion. The information uncovered large-scale wrongdoing at the bank that led to investigations in several countries, including the UK. HSBC chief executive Stuart Gulliver later apologised to MPs for “unacceptable” practices at the bank’s Swiss subsidiary which he said had caused “damage to trust and confidence” in the company. Sven Giegold, an MEP and spokesperson for the German Greens on transparency and integrity said on Thursday that Mr Falciani should be awarded a medal for his actions. “Falciani deserves a European Order instead of imprisonment in Switzerland,” Mr Geigold said.

“He was one of the first whistleblowers to pioneer the fight against global tax fraud, followed by many disclosures in Switzerland, Luxembourg, Liechtenstein and other tax havens,” “We should be grateful to him. Europe’s governments should call on the Spanish government not to extradite Falciani. His extradition would be shamefully ungrateful after having profited from his data financially and politically.”

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Misuse of public funds. Not what Spain wanted. Just let him go. Germany can’t extradite someone on that.

German Court Says Carles Puigdemont Can Be Released On Bail (G.)

A court in northern Germany has ruled that the former Catalan president Carles Puigdemont can be released on bail while extradition proceedings continue. The district court in Schleswig set bail for the 55-year-old at €75,000 (£66,000). Puigdemont was arrested on a Spanish-issued warrant upon entering Germany on 25 March as he attempted to drive from Finland to Belgium, where he currently resides. Spain accuses the Catalan separatist of rebellion and corruption after he organised an unsanctioned independence referendum. The Schleswig court said that it considered a charge of misuse of public funds sufficient grounds for an extradition, but that a charge of “rebellion” was not, because the comparable German charge of treason specifies violence.

Proceedings to decide whether to extradite him on corruption charges could continue, it said. “There is a risk of flight,” the court said in its explanation of its decision to grant bail. “But since extradition on rebellion charges is impermissible, the risk of flight is substantially lessened.” Puigdemont has written an open letter from prison, urging Catalonia’s parliament to make another attempt to elect jailed separatist activist Jordi Sànchez as the region’s president. Puigdemont had proposed Sànchez as his number two in the Together for Catalonia party last month, but Spain’s supreme court refused to free him to attend a parliamentary session. Sànchez said in a letter from a Madrid jail published on Thursday that he was ready to try again to be elected.

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In that society, no wonder.

Young People In Britain Have Never Been Unhappier (G.)

Young people’s happiness across every single area of their lives has never been lower, research by the Prince’s Trust has found. The charity, set up by the Prince of Wales, said the results of its annual UK Youth Index, which gauges young people’s happiness and confidence across a range of areas, from working life to mental and physical health, should “ring alarm bells”. The national survey shows young people’s wellbeing has fallen over the last 12 months and is at its lowest level since the study was first commissioned in 2009. The research, based on a survey of 2,194 respondents aged 16 to 25, revealed that three out of five young people regularly feel stressed amid concerns over jobs and money, while one in four felt “hopeless”, and half had experienced a mental health problem.

Almost half said they did not feel they could cope well with setbacks in life, but despite this more than one quarter said they would not ask for help if they were feeling overwhelmed. The index shows that young people are particularly disillusioned with the job market and are concerned about money and future prospects. One in ten said they had lost a job through redundancy or having a contract terminated or not renewed, or being fired, while 54% said they were worried about their finances. The report highlights significant differences between the views held by young men and women, particularly when it comes to how they feel about their future prospects. Young women are more likely to think a lack of self-confidence holds them back and 57% of young women worry about “not being good enough in general”, compared to 41% of men.

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Or do they? Is the secret in the synopses?

Elderly People Grow As Many New Brain Cells As Young (Ind.)

Elderly people grow as many new brain cells as teenagers, according to a new study which counters previous theories that neurons stop developing after adolescence. Healthy men and women continue to produce new neurons throughout life, suggesting older people remain more cognitively and emotionally intact than previously believed, researchers found. For decades it was thought that adult brains were hard-wired and unable to form new cells. But a Columbia University study found older people continued to produce neurons in the hippocampus – a part of the brain important for memory, emotion and cognition – at a similar rate to young people. Researchers examined the brains of 28 previously healthy people who died suddenly between the age of 14 and 79.

“We found that older people have similar ability to make thousands of hippocampal new neurons from progenitor cells as younger people do,” said the study’s lead author Maura Boldrini, associate professor of neurobiology. “We also found equivalent volumes of the hippocampus across ages.” The ability to generate new hippocampal cells, a process known as neurogenesis, declines with age in rodents and primates. Declining production of neurons and shrinkage of parts of the brain which help form of new episodic memories were believed to occur in ageing humans as well, explaining why younger people find it easier to learn skills and languages. But the Columbia University study found similar numbers of newly formed cells in old and young brains.

However, the researchers also noted fewer blood vessels and connections between cells in the older brains, which Ms Boldrini said “may be linked to compromised cognitive-emotional resilience” in the elderly. The findings, published in the journal Cell Stem Cell, are likely to be hotly debated. They come just a month after a University of California study suggested adults do not develop new neurons.

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That’s how bad it’s gotten.

Surgeon General Urges More Americans To Carry Opioid Antidote (CNN)

The US surgeon general issued an advisory Thursday recommending that more Americans carry the opioid overdose-reversing drug, naloxone. The drug, sold under the brand name Narcan (among others), can very quickly restore normal breathing in someone suspected of overdosing on opioids, including heroin and prescription pain medications. Dr. Jerome Adams emphasized that “knowing how to use naloxone and keeping it within reach can save a life.” To make his point, Adams relied on a rarely used tool: the surgeon general’s advisory. The last such advisory was issued more than a decade ago and focused on drinking during pregnancy.

Adams noted that the number of overdose deaths from prescription and illicit opioids doubled in recent years: from 21,089 deaths across the nation in 2010 to 42,249 in 2016. America’s top doctor attributed this “steep increase” to several contributing factors, including “the rapid proliferation of illicitly made fentanyl and other highly potent synthetic opioids” and “an increasing number of individuals receiving higher doses of prescription opioids for long-term management of chronic pain.”

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The right discussion, but launched very weakly. On purpose?

Social Media Looks Like the New Opiate of the Masses (BBG)

[..] many of us who lived through the shift from Internet 1.0 to the new age of social media can’t help but feel a nagging worry. In addition to concerns about privacy, electoral influence and online abuse, social media seems like it has many of the qualities of an addictive drug. Research isn’t conclusive on whether social-media addiction is real. But it certainly has some negative side effects that loosely resemble the downsides of recreational drugs. In 2011, psychologists Daria Kuss and Mark Griffiths wrote a paper that found: “Negative correlates of [social media] usage include the decrease in real life social community participation and academic achievement, as well as relationship problems, each of which may be indicative of potential addiction.”

Meanwhile, a number of more recent studies find similarities between social-media use and addictive behavior. And experiments found that smartphone deprivation induced anxiety among young people, a phenomenon that certainly has parallels to drug withdrawal. That certainly doesn’t mean that everyone who uses social media is a junkie. Evidence shows that moderate usage is not harmful. That fits with my own experience – I find that I derive great enjoyment from Facebook, which I use in moderation, but am often made anxious and irritable by Twitter, which I use much more. It’s the heaviest users who may be in the most danger — a recent survey found that a quarter of Americans are online “almost constantly.” And social-media use is going up relentlessly worldwide:

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“..there is no need for more land to grow sugarcane..”

Lifting Sugarcane Farming Ban ‘Last Straw’ For Amazon Rainforest (Ind.)

Environmentalists in Brazil have urged the government not to proceed with a change in the law described as the “last straw” for the Amazon rainforest. The Brazilian senate is set to vote on a bill that could see the eight-year-old ban on farming sugarcane for biofuel production in the Amazon lifted. In an open letter, 60 NGOs including Greenpeace and WWF have warned of the implications this decision would have, both for the rainforest itself and the reputation of the biofuels industry. They have been joined in their condemnation of the bill by several former Brazilian environment ministers.

The letter states: “If passed, the bill will be a tragedy for forests and for the biofuel industry in Brazil – the image of which will be damaged to the brink of no return, at a time critical to its success”. There is also concern that Brazil’s Paris climate agreement targets will be compromised if its ethanol production is not sustainable. Supporters of the new bill say it will benefit the economy and help contribute to the national supply of biofuels. However, environmentalists, scientists and even representatives from the biofuels industry say there is no need for more land to grow sugarcane, and the expansion of the industry will further drive deforestation of the rainforest.

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Reminds us of that park in India where more poachers than rhinos are killed. Beijing needs to stop this, all of it.

Bolivia’s Jaguars Under Threat Of Chinese Fang Craze (AFP)

Bolivia’s once-thriving jaguar population is loping into the cross-hairs of a growing threat from poachers responding to growing Chinese demand for the animal’s teeth and skull. Researchers believe there are around 7,000 of the speckled big cats in Bolivia, out of a global population of some 64,000, stretching from North America to Argentina. But such is the appetite in China’s huge underground market that “if controls are not put in place, it can lead to a serious problem” for their survival, warned Fabiola Suarez of the Environment Ministry. Considered vulnerable by conservationists, the jaguar’s future in the South American country is in the hands of anti-trafficking police only now coming to grips with the potential scale of the problem.

Local authorities began getting reports in 2014 of trade in the animal in the northeastern area of Beni, according to Rodrigo Herrera, an advisor to Bolivia’s directorate of Biodiversity at the Environment Ministry. He says the increased presence of Chinese nationals in the South American country has stimulated demand. President Evo Morales’ leftist government has awarded seven billion dollars’ worth of public works contracts to Chinese groups, sparking an influx of workers from the Asian giant. Herrera said each of the cat’s teeth, which measure between eight and 10 centimeters, can fetch up to $100 for poachers, but that figure can reach $5,000 on the Chinese market. The feline’s skull is also prized by traffickers, at rates of up to $1,000. Traffickers also sell the skin, and even the testicles, which along with the ground-down teeth, are prized by some Chinese as an aphrodisiac.

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