Feb 242017
 
 February 24, 2017  Posted by at 10:41 am Finance Tagged with: , , , , , , , , ,  


Marion Post Wolcott Works Progress Administration worker’s children, South Charleston, West Virginia 1938

 

France Scrapping The Euro Could Go Beyond A ‘Lehman Moment’ (CNBC)
Le Pen Says French Foreign Policy Must Be Decided in Paris (BBG)
Obamacare Just Hit Its Highest Popularity Ever (BI)
Former IMF Chief, Dozens of Former Bank Execs Sentenced to Jail in Spain (DQ)
Analyzing the Emerging World Order: The Future of Globalism (GR)
Increasingly Unhinged Russia Rhetoric From A Long-Standing US Playbook (GG)
What Does Russia Produce? (Humor)
Career Politicians Aren’t Qualified To Run The Country (Hewson)
Turkish Commandos Ask For Asylum In Greece (K.)
Synthetic Clothing And Tires Could Be Polluting The Oceans In A Big Way (CNBC)
Arctic ‘Doomsday’ Seed Vault Receives 50,000 New Deposits (AP)
Plan To Save Great Barrier Reef Set Back Decades (AFP)

 

 

Fear mongering goes into overdrive.

France Scrapping The Euro Could Go Beyond A ‘Lehman Moment’ (CNBC)

Past performance is no guide to future returns, as investors are so often told, but the French electorate runs the risk of creating a crisis worse than the fall of Lehman Brothers if it follows the U.K. in instigating a referendum on EU membership, according to analysts at Deutsche Bank. As the French presidential race heats up ahead of the first round of voting in April, the German bank has warned of the pitfalls of using the U.K.’s Brexit vote as a model for a potential “Frexit”, as touted by nationalist candidate Marine Le Pen. Le Pen, who is currently leading the race according to the latest BVA-Salesforce opinion poll, has vowed to hold a French referendum on EU membership if she is successful in winning France’s two-round leadership race.

Pointing to the U.K., which has – so far – felt a relatively benign impact from its Brexit vote, Le Pen has relied on it as a basis for rallying support during her campaigning, saying: “They told us that Brexit would be a catastrophe, that the stock markets would crash … The reality is that none of that happened.” However, Deutsche Bank has warned of the inconsistencies of likening the two votes. An EU referendum in France, one of the founding members of the economic bloc, runs the risk of undermining the euro, the currency shared by 19 of the EU’s 28 member states. “Make no mistake, there is the world of difference between tearing up bilateral and multilateral trade agreements, and, unwinding a monetary union as far reaching in scope as the EMU (economic and monetary union) project,” Deutsche Bank said in a note Tuesday.

“It is the difference between a benign global risk event and something that has the potential to go beyond a ‘Lehman’s moment’.” The frictionless interaction enjoyed by countries within the European Monetary Union would turn into it a “nightmare”, says Deutsche Bank, as a lack of a currency hedge would make all EMU members vulnerable to currency weakness. The bank estimates that assets shared between the economic bloc plus liabilities totaled €46 trillion at the end of the third quarter 2016. This it describes as an “upper bound estimate of EMU exposure that would have no hedge, and be exposed to currency risk in the event of an EMU break-up.”

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And many people all over Europe will say she’s damn right.

Le Pen Says French Foreign Policy Must Be Decided in Paris (BBG)

French foreign policy should be decided solely in Paris, French presidential candidate Marine Le Pen said, calling for a reversal of her country’s quest over past decades for tighter ties with European Union allies. Laying out her foreign-policy vision in a speech in Paris, Le Pen spoke of a world based on nation states that pursue their own interest and preserve their own cultures without interference. “To assure the freedom of the French, there is no price too high too pay,” Le Pen said. “The foreign policy of France will be decided in Paris, and no alliance, no ally, can speak in her place.” Her first move as president would be to renegotiate EU treaties as an initial step toward creating a “Europe of Nations,” she said. She saluted Britain’s vote to leave the EU, and said she’d withdraw from NATO’s military command.

“I rejoice in Europeans claiming back their freedom against the attempts to create an artificial super-state,” she said. “The European Union is not the solution, it’s the problem.” Polls show that Le Pen would win the most votes in the April 23 first round of the elections, but would lose the May 7 run-off against whoever she faces. On the U.S., she said she was hopeful President Donald Trump would reverse what she described as interventionist policies of President Barack Obama. She listed support for rebels in Libya and Syria as “mistakes” that have undermined world peace. “The U.S. is an ally but sometimes an adversary,” she said, adding that she was encouraged by Trump’s early days in office.

She said Russia has an “essential balancing role to keep world peace” and “has been badly treated by the European Union.” In Africa, French policy would be one of “non-intervention, but not indifference.” Le Pen said communism and liberal capitalism have both been delusions, and that “people are trying to escape, and find in the nation the best way to protect themselves. Each country should be free to follow its interests, choose its allies, preserve its culture, and France supports that right for all nations.”

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Hornets nest.

Obamacare Just Hit Its Highest Popularity Ever (BI)

Americans are learning to love the Affordable Care Act, better known as Obamacare. As the law faces possible repeal and replacement by Republicans, a new poll from the Pew Research Center shows that the ACA’s popularity is soaring and has hit its highest point since it was passed. 54% of respondents in Pew’s survey said they approve of the law, with just 43% disapproving. This is better than the 48% approve, 47% disapprove margin from December 2016. Additionally, of the 43% against the law, only 17% of people the total surveyed want Republicans to repeal the way entirely while 25% want the law modified instead, according to Pew.

Every age group, ethnic group, and education level saw increased support for Obamacare between Pew’s current poll and one conducted in October 2016. The result also matches up with other recent polls from a variety of outlets that show President Barack Obama’s signature health law becoming ever-more popular with Americans. House Speaker Paul Ryan said that the GOP plans to introduce a repeal and replace bill for the ACA soon after the week-long President’s Day break. Dissent among Republicans and recent pushback from constituents at town halls, however, has indicated that a repeal may be less than smooth than originally anticipated. Even former GOP House Speaker John Boehner said Thursday that repeal is “not going to happen.”

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A 6-year sentence but no hard time?

Former IMF Chief, Dozens of Former Bank Execs Sentenced to Jail in Spain (DQ)

The unimaginable just happened in Spain: two former bank CEOs, Miguel Blesa (CEO of Caja Madrid) and Rodrigo Rato (CEO of Bankia) were just awarded prison sentences of six years and four-and-a-half years, respectively, for misappropriation of company funds. Rato was also Managing Director of the IMF from 2003 to 2007. He was succeeded by another luminary, Dominique Strauss Kahn. Now, the question on everyone’s mind is will Blesa and Rato actually serve the sentence (more on that later). Dozens more former Caja Madrid senior executives, most of whom are closely connected to either, or both, of the country’s two main political parties and/or unions also face three to six years in prison. They were found guilty by Spain’s National High Court of misusing company credit cards.

Those cards drained money directly from the scarce funds of Caja Madrid, which at the height of Spain’s banking crisis was merged with six other failed savings banks into Bankia, which shortly thereafter collapsed and ended up receiving the biggest bail out in Spanish history, costing taxpayers over €20 billion, to date. Between 2003 and 2012 Caja Madrid (and its later incarnation, Bankia) paid out over €15 million to its senior management and executive directors through its “tarjeta negra” (black card) scheme. According to accounts released by Spain’s bad bank, FROB, much of that money went on restaurants, cash withdrawals, travel and holidays, and the like. The amounts – which did not show up on any bank documents, job contracts, or tax returns – may be small, given the magnitude of the misdeeds that led to the Spanish bank fiasco, but it’s the principle that counts.

Only 4 out of 90 Caja Madrid senior managers, executives, and board members had the basic decency to turn down the offer of undeclared expenses. For the rest, it was an offer they could not refuse. In his last few months at Caja Madrid – just before the whole edifice came crumbling down – Blesa went on a mad spending binge. In one month alone he made purchases on his black card worth €19,000 – more than many Spaniards’ annual salary. This is a man who pocketed over €20 million in salaries and bonuses while at the helm of the bank that he helped destroy. On his departure in 2010, he was awarded a €2.5 million golden parachute. Yet even after his ouster he, like many other Caja Madrid executives, continued making liberal use of his tarjeta negra.

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“The unsolvable problem here is that this debt based system is really just an elaborate pyramid scheme predicated on ever increasing amounts of debt in a world where sources of real wealth are finite.”

Analyzing the Emerging World Order: The Future of Globalism (GR)

We live in a world subdivided by societies: nations and their respective subdivisions. As a matter of fact, there are over 200 nations recognized by the United Nations (UN). We are taught that a society must conform to a binary label such as “free” or “unfree”, “democratic” or “non-democratic” and so on. This is done principally for two reasons – to provide a tautological definition, also for easier control of the masses via manipulation. The current overarching narrative provides that we are divided between the “western” and “eastern” worlds. What does this really mean? We can distill this down to one principal root: economics. What do we mean by economics? We can say that in it’s purest form, it is simply the structured allocation of finite resources.

Today we are observing the transition from a so called unipolar world, one in which a single nation (or group of allied nations) dictates the terms of life for all global citizens, to a more balanced and natural multipolar world. The current dominating group, the “western” bloc of nations, is led by the United States along with numerous vassal states; this order has persisted since the end of the Second World War. This construct is held together using a combination of supranational organizations (UN,WTO,World Bank, IMF, et cetera), propaganda (mainstream media complex), armed might (MIC,NATO, private mercenary forces) and chiefly economics (central banks, corporations). The true “rulers” of this bloc are a cabal of very wealthy and powerful oligarchs that work in the background (shadow banking, dark pool finance, shadow governments, think tanks, NGO’s) to subvert the various sovereignties to their advantage.

These oligarchs are the principal owners of, not just the industries and corporations that front for them, but the governments that rule over the masses. Most importantly this cabal owns the means by which real wealth extraction is carried out: fiat currency, chiefly the “worlds reserve currency”- the United States dollar and it’s derivatives. These currencies are backed not by equitable assets; such as natural resources, precious metals or productive capacities; instead they are backed by the creation of debt. Debt that represents a claim on real assets that virtually all participants in global commerce must pay. How did this cabal come into power? This is a complex question that is subject to many possible answers and interpretations. Briefly, we know from historical fact that a global empire is a central part of this construct, today the United States empire holds that role (previously British, French so on…). This provides the controlling force behind such a cabal.

The privately owned quasi-governmental western central banks are at the heart of this operation. They form the crucial nexus between sovereign governments and the financial world in which they derive their revenue stream, and by extension, their power. The current seat of this construct (United States) was founded as a Constitutional Republic. Unfortunately, the United States Constitution is quite amorphous. Using many acts of legislative, executive and even judicial fiat, this cabal has been able to effectively take over the reigns of the nation. With that feat accomplished, near world domination was made possible. A complex web of regulations, laws, and rules; coupled with a financial system few fully comprehend has been put into place across the west. This became the mechanism by which this “new world order” has been enforced.

The unsolvable problem here is that this debt based system is really just an elaborate pyramid scheme predicated on ever increasing amounts of debt in a world where sources of real wealth are finite. At present, the growth rate and the total amount of debt issuance, is outpacing the extraction rate and amount of available reserves of resources on the planet.

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Glenn Greenwald has been vocal about the Putin hysteria.

Increasingly Unhinged Russia Rhetoric From A Long-Standing US Playbook (GG)

For aspiring journalists, historians, or politically engaged citizens, there are few more productive uses of one’s time than randomly reading through the newsletters of I.F. Stone, the intrepid and independent journalist of the Cold War era who became, in my view, the nation’s first “blogger” even though he died before the advent of the internet. Frustrated by big media’s oppressive corporatized environment and its pro-government propaganda model, and then ultimately blacklisted from mainstream media outlets for his objections to anti-Russia narratives, Stone created his own bi-monthly newsletter, sustained exclusively by subscriptions, and spent 18 years relentlessly debunking propaganda spewing from the U.S. government and its media partners. What makes Stone’s body of work so valuable is not its illumination of history but rather its illumination of the present.

What’s most striking about his newsletters is how little changes when it comes to U.S. government propaganda and militarism, and the role the U.S. media plays in sustaining it all. Indeed, reading through his reporting, one gets the impression that U.S. politics just endlessly replays the same debates, conflicts, and tactics. Much of Stone’s writings, particularly throughout the 1950s and into the 1960s, focused on the techniques for keeping Americans in a high state of fear over the Kremlin. One passage, from August 1954, particularly resonates; Stone explained why it’s impossible to stop McCarthyism at home when — for purposes of sustaining U.S. war and militarism — Kremlin leaders are constantly being depicted as gravely threatening and even omnipotent. Other than the change in Moscow’s ideology — a change many of today’s most toxic McCarthyites explicitly deny — Stone’s observations could be written with equal accuracy today.

[..] Few foreign villains have been vested with omnipotence and ubiquity like Vladimir Putin has been — at least ever since Democrats discovered (what they mistakenly believed was) his political utility as a bogeyman. There are very few negative developments in the world that do not end up at some point being pinned to the Russian leader, and very few critics of the Democratic Party who are not, at some point, cast as Putin loyalists or Kremlin spies. Putin — like al Qaeda terrorists and Soviet Communists before him — is everywhere. Russia is lurking behind all evils, most importantly — of course — Hillary Clinton’s defeat. And whoever questions any of that is revealing themselves to be a traitor, likely on Putin’s payroll.

As The Nation’s Katrina vanden Heuvel put it on Tuesday in the Washington Post: “In the targeting of Trump, too many liberals have joined in fanning a neo-McCarthyite furor, working to discredit those who seek to deescalate U.S.-Russian tensions, and dismissing anyone expressing doubts about the charges of hacking or collusion as a Putin apologist. … What we don’t need is a replay of Cold War hysteria that cuts off debate, slanders skeptics and undermines any effort to explore areas of agreement with Russia in our own national interest.” That precisely echoes what Stone observed 62 years ago: Claims of Russian infiltration and ubiquity are “the thesis no American dare any longer challenge without himself becoming suspect” (Stone was not just cast as a Kremlin loyalist during his life but smeared as a Stalinist agent after he died).

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Turns out, a lot.

What Does Russia Produce? (Humor)

This past September, in one of his regular interviews with the newspaper Parlamentní Listy, retired Czech Major General Hynek Blasko commented on the possibility of a conflict between Russia and NATO with a following anecdote: “I have seen a popular joke on the Internet about Obama and his generals in the Pentagon debating on the best timing to attack Russia. They couldn’t come to any agreement, so they decided to ask their allies. The French said: ” We do not know, but certainly not in the winter. This will end badly. ” The Germans responded: “We do not know, either, but definitely not in a summer. We have already tried.” Someone in Obama’s war room had a brilliant idea to ask China, on the basis that China is developing and always has new ideas.

The Chinese answered: “The best time for this is right now. Russia is building the Power of Siberia pipeline, the North Stream Pipeline, Vostochny Cosmodrome Spaceport, the MegaProject bridge to Crimea; also Russian is upgrading the Trans-Siberian railroad with a new railway bridge across Lena River and the Amur-Yakutsk Mainline. Russia is also building new sports facilities for the World Cup and athletics, and has in development over 150 production projects in the Arctic … Well, now they really need as many POWs as possible!” So, now, even NATO members’ generals have noticed something peculiar about Russia. According to the myth that is being peddled by Western media, Russia has an underdeveloped economy based on the exchange of raw mineral resources for glass beads… I mean Western produced hi-tech products. Any barber would tell you that even Asians can make iPhones, but Russians can’t.

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View from Australia that applies everywhere.

Career Politicians Aren’t Qualified To Run The Country (Hewson)

When I was leader of the opposition, concerned about the standing of our politicians and failing confidence in our political processes, John Howard used to chip me about the need to recognise politics as a “profession”, and politicians as “professionals”. Now, some 25 years on, the dissatisfaction with our career politicians and the political system is of paramount importance, and fundamental to the drift away from the major parties, whereby now almost one in three direct their votes elsewhere. Politics has become a daily “conflict game”, dominated by career politicians concentrated on winning points on the other side, rather than on developing and delivering good public policy, and good government.

Important issues have been left to drift, or in some cases have been compounded by short-term, populist responses, so that important problems remain unresolved, all having a negative impact on the wellbeing of the average voter, let alone the legacies being left to their children. Minor parties and independents are attracting support in protest, or in the now desperate hope that they will at least shake things up, perhaps even drive governments and oppositions to better economic and social outcomes. But they too are mostly opportunistic, and populist, and often “extreme”, knowing they will never be in a position to have to deliver. Moreover, without experience and the requisite skills, they too may soon be “absorbed” or “defeated” by the system. Unfortunately, the skill sets and experience required of a career politician essentially make them incompetent to govern effectively.

Their career path is often from university, community or union politics, through local government/party engagement, perhaps serving as a ministerial staffer, to pre-selection, then election, and so on. Politics has become the end in itself. Those that make it are mostly qualified just to play the “game”, but not to govern. Increasingly, fewer have ever had a “real job”, or a significant career, before entering politics, and even then that may not qualify them to be a competent minister. It is also not easy to come from outside, as both Trump and Turnbull are finding. Yet, many end up as ministers responsible for significant government portfolios, and large budgets, with little or no relevant experience or skills or commitment to that area, let alone in management. Clearly, if we were to advertise the ministerial posts to attract those with the necessary competence – with the abilities, commitments, knowledge, experience and skills to do the job well – very few indeed, if any, of the current lot would be appointed.

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These guys were allegedly directly involved the coup?! Hard to protect.

Turkish Commandos Ask For Asylum In Greece (K.)

Two Turkish servicemen believed to have been involved in the plot to assassinate Turkish President Recep Tayyip Erdogan during the July coup attempt in the neighboring country, are being held in custody in Alexandroupoli, it was revealed Thursday. The two men, former members of Turkey’s special forces, entered Greece illegally through the Evros border crossing a few days ago and turned themselves in to police authorities in Orestiada. Through a local lawyer, the two commandos applied for political asylum on February 20.They had eluded arrest for months until they entered Greece. The pair are believed to have told Greek investigators that they were indeed involved in a plot to assassinate Erdogan. So far, there has been no Turkish request for their extradition.

Meanwhile, Ankara has submitted a fresh extradition request for the eight Turkish servicemen who Ankara have accused of being involved in the coup attempt. The initial request for their extradition was rejected in January by Greece’s Supreme Court, which said that regardless of whether they were guilty or not, the servicemen would not receive a fair trial in Turkey. In the new request, Ankara provided reassurances that they would receive a fair trial. It also includes what Turkish authorities describe as new incriminating evidence. The request sent to the Greek Foreign Ministry further includes two additional charges, on top of the four included in the first extradition request. The Foreign Ministry has passed on the request to the Justice Ministry.

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The curse of carbon comes in many forms. But it’s free, so we can’t resist.

Synthetic Clothing And Tires Could Be Polluting The Oceans In A Big Way (CNBC)

A new report from the International Union for Conservation of Nature (IUCN) has found that as much as 31 percent of the estimated 9.5 million tonnes of plastic that enters the ocean annually could be from sources such as tires and synthetic clothing. These products can release “primary microplastics”, which are plastics that directly enter the environment as “small particulates”. According to the IUCN, which released the report on Wednesday, they come from a range of sources. These include synthetic textiles, which deposit them due to abrasion when washed, and tires, which release them as a result of erosion when driving.

The report identified seven “major sources” of primary microplastics: Tires, synthetic textiles, marine coatings, road markings, personal care products, plastic pellets and city dust. “Our daily activities, such as washing clothes and driving, significantly contribute to the pollution choking our oceans, with potentially disastrous effects on the rich diversity of life within them, and on human health,” Inger Andersen, director general of the IUCN, said in a statement on Wednesday. “These findings indicate that we must look far beyond waste management if we are to address ocean pollution in its entirety,” he added.

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Are they implying changing the seeds when they talk about reconstituting them, developing climate-resilient crops for generations?

Arctic ‘Doomsday’ Seed Vault Receives 50,000 New Deposits (AP)

Nearly 10 years after a “doomsday” seed vault opened on an Arctic island, some 50,000 new samples from seed collections around the world have been deposited in the world’s largest repository built to safeguard against wars or natural disasters wiping out global food crops. The Svalbard Global Seed Vault, a gene bank built underground on the isolated island in a permafrost zone some 1,000 kilometers (620 miles) from the North Pole, was opened in 2008 as a master backup to the world’s other seed banks, in case their deposits are lost. The latest specimens sent to the bank, located on the Svalbard archipelago between mainland Norway and the North Pole, included more than 15,000 reconstituted samples from an international research center that focuses on improving agriculture in dry zones.

They were the first to retrieve seeds from the vault in 2015 before returning new ones after multiplying and reconstituting them. The specimens consisted of seed samples for some of the world’s most vital food sources like potato, sorghum, rice, barley, chickpea, lentil and wheat. Speaking from Svalbard, Aly Abousabaa, the head of the International Center for Agricultural Research, said Thursday that borrowing and reconstituting the seeds before returning them had been a success and showed that it was possible to “find solutions to pressing regional and global challenges.” The agency borrowed the seeds three years ago because it could not access its gene bank of 141,000 specimens in the war-torn Syrian city of Aleppo, and so was unable to regenerate and distribute them to breeders and researchers.

“The reconstituted seeds will play a critical role in developing climate-resilient crops for generations,” Abousabaa said.The 50,000 samples deposited Wednesday were from seed collections in Benin, India, Pakistan, Lebanon, Morocco, Netherlands, the U.S., Mexico, Bosnia and Herzegovina, Belarus and Britain. It brought the total deposits in the snow-covered vault — with a capacity of 4.5 million — to 940,000.

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“Given the severity of the damage and the slow trajectory of recovery, the overarching vision of the 2050 Plan… is no longer attainable for at least the next two decades..”

Plan To Save Great Barrier Reef Set Back Decades (AFP)

Australia’s plan to rescue the beleaguered Great Barrier Reef has been set back at least two decades after the fragile ecosystem suffered its worst-ever bleaching last year, experts said Friday. The vast coral reef – which provides a tourism boon for Australia – is under pressure from agricultural run-off, the crown-of-thorns starfish, development and climate change. Last year swathes of coral succumbed to devastating bleaching, due to warming sea temperatures, and the reef’s caretakers have warned it faces a fresh onslaught in the coming months. Canberra updated the UN’s World Heritage committee on its “Reef 2050” rescue plan in December, insisting the site was “not dying” and laying out a strategy for incremental improvements to the site.

But an independent report commissioned by the committee concluded that the government had little chance of meeting its own targets in the coming years, adding that the “unprecedented” bleaching and coral die-off in 2016 was “a game changer”. “Given the severity of the damage and the slow trajectory of recovery, the overarching vision of the 2050 Plan… is no longer attainable for at least the next two decades,” the report said. Last year’s bleaching killed two-thirds of shallow-water corals in the north of the 2,300-kilometre (1,400-mile) long reef, although central and southern areas escaped with less damage. The government has pledged more than Aus$2.0 billion (US$1.5 billion) to protect the reef over the next decade, but researchers noted a lack of available funding, with many of the plan’s actions under-resourced.

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Nov 072016
 
 November 7, 2016  Posted by at 10:30 am Finance Tagged with: , , , , , , , , ,  


NPC Auto wreck, Washington, DC April 1917

Betting Sites See Record Wagering On US Presidential Election (R.)
When Might We Know Who Won? Potentially Hours Earlier Than Usual (BBG)
Could Trump Or Clinton Face Impeachment As President? (John Crudele)
This Election Has Disgraced the Entire Profession of Journalism (Silverstein)
Much More Than Trump (Repost), by Robert Gore
Private Capital Allocation As Inefficient As In Great Depression (Beversdorf)
Housing ‘Wealth Creation’ Leads To National Wealth Destruction (Janda)
China Might Finally Give Wall Street What It Wants – 20 Years Late (WSJ)
Hong Kong Derails Property Streetcar (BBG)
Negative Bond Yields in Japan Don’t Look So Bad With Deflation (BBG)
Architect Of Euro In Stark Warning (BBC)
Obama Aiming To Make Lasting Impression With Athens Speech (Kath.)
Erdogan Blasts West As Turkey’s Kurdish Party Boycotts Parliament (R.)
Great Barrier Reef: What Have We Left For Our Children? (Naomi Klein)

 

 

How fitting.

Betting Sites See Record Wagering On US Presidential Election (R.)

The raucous, passionate and unpredictable 2016 U.S. presidential election is on track to notch another distinction: the most wagered-upon political event ever. With many opinion polls showing a tight race just one day before Tuesday’s election, record numbers of bettors are pouring millions into online platforms from Ireland to Iowa in the hope of capturing a financial windfall from a victory by Democrat Hillary Clinton or Republican Donald Trump. UK-based internet betting exchange Betfair said on Sunday its “Next President” market was set to become the most traded it had ever seen and expected to surpass even Brexit. By Sunday, roughly $130 million had been traded on who will become the next U.S. president, compared with $159 million on the Brexit referendum, Betfair spokeswoman Naomi Totten said.

The amount bet so far on the 2016 contest dwarfs the roughly $50 million laid on the 2012 race. “We think it is because (of) how raw the Brexit (vote) is in people’s minds – they’re not convinced yet that it’s a done deal,” Totten said. Most polls leading into Britain’s June 23 referendum predicted Britons would choose to remain in the EU. Instead, they voted to leave by a 52% to 48% margin. Betfair’s “Next President” market was by far the largest of more than 70 markets on the site related to the U.S. election. As of Friday, some $140 million has been put into play on markets ranging from who will win the popular vote to how many states each party will carry. On Ireland’s Paddy Power, which merged with Betfair earlier this year, the U.S. presidential election “is definitely on course to be the biggest political event,” said spokesman Féilim Mac An Iomaire. The site has had about $4.38 million bet on the race so far.

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Who needs the west?

When Might We Know Who Won? Potentially Hours Earlier Than Usual (BBG)

4. When might the public know who won? Potentially hours earlier than usual.

5. Why’s that? There’s a wrinkle this year that might undermine the tradition of major television networks holding off declaring a new president until polls close on the West Coast. Exit polling available to the networks and the Associated Press, combined with early returns in key districts, can point to a likely winner hours before the polls close. Since 1980, when Ronald Reagan’s landslide victory was called while West Coast polls were still open – spurring complaints that some voters didn’t see any reason to go to the polls — networks have resisted calling winners until a given state’s polls have closed.

6. Who’s challenging that arrangement this year? A startup company called VoteCastr plans to collect data from seven battleground states – Colorado, Florida, Nevada, New Hampshire, Ohio, Pennsylvania and Wisconsin – on Election Day, stream it through a mobile app and use it “to generate minute-by-minute projected outcomes.” The news website Slate.com will publish VoteCastr’s findings as they come in. “Publishing our data will help level the playing field, so that voters know as much as campaigns do,” Slate’s editor, Julia Turner, said.

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Not easy. Entirely new information would be needed.

Could Trump Or Clinton Face Impeachment As President? (John Crudele)

[..] .. might it be possible for Congress to initiate impeachment proceedings immediately after their swearing-in as president, whoever wins? I asked professor Eric Schickler, who is the chairman of Travers Department of Political Science at the University of California, Berkeley. “That is an interesting question”, Schickler said. “The conventional understanding of impeachment is that it is due to actions taken while in office. That is how it has traditionally been applied. But impeachment, as anyone who has lived through the Nixon and Bill Clinton eras knows, is ultimately a political decision”, says Schickler. “The Constitution does not define ‘high crimes and misdemeanors’, which is supposed to be the standard for an impeachable offense. “As such, there is discretion for Congress to define its range”, he added.

But Schickler says it would be a “serious case of political overreach for Congress to impeach after an election for actions taken before a person is in office. That s particularly so where those actions were known at the time of the election itself”, he says. OK, my turn again. So what he s saying is that an impeachment proceeding right after the election would really piss voters off. Then, how about a month after inauguration? Or six months? Or a year from now, when the economy still isn t buzzing (as it s unlikely to be) and people have had enough of our new president – whoever that may be. So let’s figure out what crimes we can come up with for Trump and Hillary Clinton. Clinton’s crimes are obvious. Her opponent has described her as a liar and a crook, and so have I.

She has nearly been indicted twice, and could easily have other offenses that are lurking in the background. She’s become very wealthy because of connections made while in public service. She’s had numerous shady real estate deals and even had a commodities transaction – admittedly long ago – that reeked. And there’s the e-mail controversy. And perhaps lying to Congress and the FBI. And things that may have occurred at the Clinton Foundation. And on and on and on. And if the Republicans keep control of Congress, it’s anyone’s guess if they will go after her. Trump’s “crimes” are a little harder to spot. He’s a pig, that’s for sure. But pinching someone in a bar or saying vulgar things on camera aren’t really impeachable unless, of course, the enemies in his own party decide that they’d prefer vice presidential candidate Mike Pence as a substitute.

Professor Michael J. Gerhardt, the Samuel Ashe Distinguished Professor of Constitutional Law at the University of North Carolina at Chapel Hill, says that a president “may be impeached based on serious misconduct committed prior to the time the individual entered the office he or she currently occupies.” A federal district judge, for instance, got impeached (which is like an indictment) and convicted for lying on a questionnaire he needed to fill out for the job. But there’s a catch, says Gerhardt. The misconduct has to be serious — which is a tricky term to define — and not considered at the time of the election. “It becomes a trickier case if the American people can be said to have ‘ratified’ the prior misconduct” by electing that person.

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Planet Ponzi speaks.

This Election Has Disgraced the Entire Profession of Journalism (Silverstein)

There’s nothing secret about the media’s anti-Trump stance. A formal declaration of war was launched on August 7, when Jim Rutenberg, the New York Times media columnist, wrote a story under the headline, “Trump Is Testing the Norms of Objectivity in Journalism.” Rutenberg wrote that journalists were in a terrible bind trying to stay objective because Trump, among other things, “cozies up to anti-American dictators,” has “put financial conditions on the United States defense of NATO allies,” and that his foreign policy views “break with decades-old …consensus.” Rutenberg made clear that he and other reporters viewed “a Trump presidency as something that’s potentially dangerous,” which required them to report on him with a particularly critical point of view. This, he said, would make journalists “move closer than you’ve ever been to being oppositional,” which would be “uncomfortable and uncharted territory.”

There are so many things wrong with all this that it’s hard to know where to start. Rutenberg’s comment about dictators was clearly a reference to Vladimir Putin, who is an authoritarian leader who Trump, to his shame, admires. However, Russia is not the world’s worst dictatorship — and has been far more effective at fighting ISIS than the Obama administration — and Hillary’s cordial relationship with the Saudi regime, to cite just one example, seems far more dangerous. But rethinking “the alliances that have guided our foreign policy for 60 years” — the alliances that have resulted in non-stop war since 9/11 and the U.S.’s current involvement in seven overseas conflicts — is not an acceptable position for a presidential candidate in Rutenberg’s view.

Furthermore, how is it that the media has derogated to itself the right to decide what candidates deserve special scrutiny and what policies are acceptable? In a democracy, that is supposed to be the voters’ job. And worst of all is Rutenberg’s statement about the role of journalists. “All governments are run by liars and nothing they say should be believed,” I.F. Stone once wrote. “Journalism is printing what someone else does not want printed: everything else is public relations,” said George Orwell. For those two self-evident reasons, being “oppositional” is the only place political journalists should ever be, no matter who is in power or who is campaigning. But for Rutenberg and the New York Times being oppositional is only “uncomfortable” when it comes to covering Hillary Clinton.

It didn’t seem uncomfortable at all when it came to running a story about Trump’s taxes based on three pages of a decades-old tax return that was sent anonymously or when it ran another story with the headline, “The 282 People, Places and Things Donald Trump Has Insulted on Twitter: A Complete List.” All during the campaign we have watched Hillary Clinton rehearse campaign themes and, almost as if by magic, the media amplifying those themes in seeming lockstep. The hacked emails from Clinton campaign chairman John Podesta have demonstrated that this was not mere happenstance, but, at least in part, resulted from direct coordination between the Clintonistas and the press.

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“..a chasm that cannot be straddled..”

Much More Than Trump (Repost), by Robert Gore

While the Kennedy assassination offered the American public a glimpse into the heart of darkness, only a few independent-minded skeptics challenged the Warren Commission whitewash. Vietnam was different; hundreds of thousands returned knowing not just that the so-called best and brightest couldn’t win the war, but that for years they had lied to the American public. In the following decades, it had to have been especially galling for the Vietnam veterans that the hippies, draft-deferred campus protesters, the “fortunate sons” (google Credence Clearwater Revival) whose numbers never came up, and the mockers of the values they held dear ended up among the elite. The Clintons, of course, became the prime example.

Disaffected veterans were the core of a group that would grow to millions, their “faith” in government and the people who ran it obliterated by its repeated failures and lies. Revolutions dawn when an appreciable number of the ruled realize their rulers are intellectual and moral inferiors. The mainstream media is filled with vituperative, patronizing, and insulting explanations of what’s “behind” the Trump phenomenon. It all boils down to revulsion with the self-anointed, incompetent, pretentious, hypocritical, corrupt, prevaricating elite that presumes to rule this country. It is, in a word, inferior to the populace on the other side of the yawning chasm, the ones they have patronized and insulted for decades, and the other side knows it.

Peggy Noonan is one of the few mainstream writers who has tried to understand, rather than insult or condemn, the Trump phenomenon. In a widely cited article, she ascribed it to the split between the “protected,” those who run the government and its allied institutions, and the “unprotected,” the government’s and its allies’ victims (“Trump and the Rise of the Unprotected,” The Wall Street Journal, 2/25/16). It was a nice try, but Ms. Noonan is attempting to straddle a chasm that cannot be straddled. She writes for the Journal, an establishment organ, some of whose writers have been either so clueless or disingenuous that they have denied the existence of an establishment. And ultimately, the protected-unprotected differentiation doesn’t fly.

Most Trump supporters don’t want the government to do something for them; they want the government to quit doing things to them. They viscerally revile the elite—it’s personal—and they want no part of that class or its government. They know how to take care of themselves, and many know the government hurts the most those whom it ostensibly protects.

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Whet can be done when demand is set to be weak for a long time?

Private Capital Allocation As Inefficient As In Great Depression (Beversdorf)

1) Economic policy objectives (monetary and fiscal) are meant to incentivize domestic private business investment, which drives incomes and the money multiplier effect, i.e. the engine of the economy.

2) Economic policy objectives have failed because CEO’s, the private capital allocators, simply cannot accommodate business investment when the demand function is as weak as we currently find it, no matter how available and how cheap the capital.

3) The demand function is weak because we misunderstood and ignored the side effects of trade policies and their reliance on new world economies that naturally have a lower money multiplier effect than old world economies.

4) A materially damaged demand function leads to a misallocation of resources; for the past 15 years capital has been and continues at an accelerating rate to be allocated to cash distribution (the most economically inefficient use of capital) rather than investment, further deteriorating the demand function (economic death spiral).

5) The only question that matters now then is; How do we get private sector capital allocators to allocate capital more efficiently? I’ll give you a hint, it requires indications of sustainable demand improvement and neither monetary nor fiscal policy have the capacity to generate sustainable demand improvement when the demand function is damaged to the point that CEO’s refuse to invest productively. This then requires a new economic policy framework, one that CAN generate sustainable demand improvement, which will allow capital allocators to invest productively.

We can understand the problem without villainizing any particular stakeholders by focusing on where we are today and delivering a viable solution. Mistakes were made and judging whether they were honest or malicious in nature is irrelevant to finding the solution. Our focus here is a solution.

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Bloated home prices strangle consumption, which is typically 50-70% of GDP.

Housing ‘Wealth Creation’ Leads To National Wealth Destruction (Janda)

Robertson cites two brunches a week, two coffees a day and a $60 dinner a week as areas where many Gen Ys could save some cash. Aside from the many responses I’ve heard from Gen Ys who don’t spend anything like this much on such items, when you add up the savings it really isn’t that much. On Robertson’s figures one could save just under $6,000 a year. Let’s be extra tight arse and cut out the booze, say $50 a week for $2,600 a year, save another $1,000 by holidaying up the coast in a caravan park instead of heading overseas and $400 more through buying cheaper clothes. So let’s assume it’s reasonable to cut $10,000 in expenses and let’s also assume, even though it’s unlikely given their other spending habits, that our hypothetical Gen Y already saves $5,000 a year from their post-tax, post-HECS/HELP repayment income.

With a median home price of $800,000 in Sydney, it would take a single person more than a decade to save a deposit, so more than five years for a couple who were both saving $15,000 a year. But first time buyers shouldn’t be buying the median, or middle-priced, home I hear boomers respond. Agreed. So let’s take the median apartment price instead. Given the number of studios and tiny one-bedders out there, the median unit price probably gets you a pretty small apartment within 10km of the CBD or a two-bedder somewhere further out. Surely the boomers can’t begrudge that as being excessively luxurious? That’s still $138,000 for a 20% deposit, not including stamp duty, legal and moving costs.

For a single person that’s still nine years of saving, or the best part of five for a couple, and that’s assuming home prices don’t keep rising faster than their incomes and the earnings on their savings, which has been the experience of the past four years. Even a deposit on a Melbourne apartment is six-and-a-half years of saving for a single and more than three years for a couple, again not including other unavoidable purchase costs. That’s the individual challenge that Gen Ys face, even those on pretty decent incomes which are becoming rarer in an increasingly part-time and casualised labour market. But what all of the analysis thus far has ignored is the macroeconomic cost. Imagine for a second that hundreds of thousands of Gen Ys gave up all their brunches and coffees – cafes across Australia would be going broke.

Who do they employ? Often Gen Ys. Likewise the restaurants, bars and retailers that would also be hit if Gen Y really did close their wallets completely. This illustrates the problem with an over-inflated housing market, it absolutely sucks the life out of every other part of the economy.

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“Chinese banks had a 10% share of investment-banking revenue in Asia [..] a decade ago… This year, that share has increased to 61%..”

China Might Finally Give Wall Street What It Wants – 20 Years Late (WSJ)

Beijing is considering allowing Wall Street firms to run their own investment-banking businesses on the mainland, according to people briefed on the discussions, a long-awaited step that would give them more access to China’s hard-to-crack domestic market. The move is being discussed as part of a new U.S.-China trade and investment framework. Firms such as Goldman Sachs and J.P. Morgan Chase potentially could operate investment-banking business in China on their own. Currently, the firms must pair with domestic brokerages in joint ventures. The people briefed on the discussions caution negotiations aren’t finalized. Details need to be hashed out with Chinese regulators, and any agreement would need to be ratified by the U.S. Senate.

The possibility of getting closer to the Chinese market is a breakthrough for Wall Street firms. Global banks have limited access to the $7.48 trillion stock markets of Shanghai and Shenzhen and China’s domestic bond market, compared with the ease they can operate in global markets such as London and Tokyo. Any change, however, would come at a late stage. China’s banks have large balance sheets and have become formidable rivals. The banks also have long relationships with corporate Chinese clients, some of whom may not recognize Western brand names.

Chinese banks had a 10% share of investment-banking revenue in Asia, excluding Japan and Australia, a decade ago, according to data provider Dealogic. This year, that share has increased to 61%, boosted by Chinese companies that prefer to do business with domestic firms. Although U.S. banks have spent heavily to bulk up operations in the region, their share has declined since 2000, from 43% to just 14% so far this year, according to Dealogic.

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Popping bubbles before they become tumors.

Hong Kong Derails Property Streetcar (BBG)

When pro-market authorities tamper with prices to cool asset bubbles, economists speak of “throwing sand in the wheels of finance.” Having emptied its bucket of sand without stanching the desire to own property, Hong Kong decided to derail the out-of-control streetcar in a pit of exorbitant taxation. Considering the more painful alternative, it’s a wise move. Now that foreigners, including all-important mainland Chinese buyers, must pay a 30% stamp duty to buy overpriced shoeboxes, transactions could drop by 70%, Bloomberg News reported. Weaker demand might jolt earnings of the city’s developers. That’s what the biggest drop in 16 months in Cheung Kong Property’s shares suggested Monday. A more violent reaction, which might have occurred as Hong Kong’s U.S.-linked interest rates rose, may have been avoided.

As Gadfly pointed out, Hong Kong property has been a magnet for the kind of speculative frenzy that Singapore managed to tame. A gush of money out of the People’s Republic and into something – anything – in Hong Kong is the main reason a skilled worker in the territory was being asked to hand over seven years’ more wages than his Singapore counterpart to own the roof over his head. Even as Hong Kong’s pro-democracy activists are ticked off by Beijing for trying to chart an independent political course, the city can exert more control over its economic destiny by making the world’s least affordable housing a little less so. Not only will the 30% tax dissuade mainland buyers, it also could also put an end to speculative land purchases by Chinese developers.

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Well, let’s all get us some deflation then.

Negative Bond Yields in Japan Don’t Look So Bad With Deflation (BBG)

If you thought Japan’s negative yields don’t offer any value, take a look at the nation’s fall back into deflation. The 10-year Japanese government bond yield of minus 0.065% turns into a real yield of about 44 basis points, near a three-year high, after accounting for consumer prices. The figure beats the U.S. 10-year real yield of about 30 basis points. The Bank of Japan last week acknowledged its negative short-term interest rates and its plan to control the yield curve will need more time to push up living costs. It forecast 2% inflation won’t be achieved until the year ending March 2019. Bondholders are the beneficiaries, with Japan’s debt market little changed over the past month, even as Treasuries dropped 0.4%, based on the Bloomberg World Bond Indexes.

“Even with the BOJ being vigilant about controlling bond levels, Japanese yields are on a gradual declining path given the lack of conviction that prices will rise,” said Souichi Takeyama at SMBC Nikko Securities Inc. in Tokyo, a unit of Japan’s second-biggest lender. “There is a lack of concern about inflation.” The government will test demand when it sells 10-year debt Tuesday and 30-year bonds on Thursday. Japanese consumer prices are falling at a year-on-year pace of 0.5%, matching the biggest declines since 2013, giving bondholders reason to stick with the securities at a time when the central bank is trying to hold nominal 10-year yields at about zero. In the U.S., investors get 1.80%. Japan’s 40-year bond is more attractive at 0.575%, or a real yield exceeding 1%.

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Wonder how much he blames himself for.

Architect Of Euro In Stark Warning (BBC)

A founding father of monetary union has given a damning assessment of the euro bloc, saying that not incorporating an exit strategy was a mistake. Prof Otmar Issing told the BBC’s Wake up to Money that faultlines across the eurozone remain, citing economic weakness in Greece, Portugal and Italy. The ECB’s first chief economist also warned about the impact of negative interest rates. And he said political pressures threatened central banks’ independence. Prof Issing told the BBC that structural problems in the eurozone and dwindling public support in some countries were still major problems. The euro currency was “stable and performing much better than expected”, he said. “But I wish I could say the same about the euro area.”

Countries that tipped the bloc into recession during the global financial meltdown were still in serious economic trouble. Greece was in “permanent crisis”, and economic reforms in Portugal and Italy were either on hold or being reversed, the professor said. Prof Issing, a former adviser to Germany’s Chancellor Angela Merkel, has in recent years become suspicious of the euro project he helped to create, warning that it would collapse without reform. He told the BBC that it was a “mistake in the construction of the whole arrangement that once a member, you remain a member for eternity”. It meant that countries not complying with the eurozone’s economic and budgetary rules “can blackmail the others”. Allowing a temporary exit would, for example, have helped Greece to reform its economy so that it could then return later in better financial health.

However, some countries should never have joined the euro in the first place, he said, without naming names. They “were not yet ready to thrive under a single monetary policy and one central bank”. Prof Issing is also increasingly concerned about central banks’ use of zero or negative interest rates in a bid to stimulate growth. The policy has been used by, among others, the ECB, Japan, Switzerland and Sweden It is hindering the recovery of banks, he said, adding: “If it persists for longer, then I think we will see dramatic consequences for insurance companies and pension schemes.” Furthermore, “the longer zero interest rates continue, the more difficult it will be to exit from this situation”.

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A lasting impression accompanied by Victoria Nuland and new ambassador to Greece Geoffrey Pyatt. Athens has better be very careful with the Ukraine star couple in place.

Obama Aiming To Make Lasting Impression With Athens Speech (Kath.)

US President Barack Obama is planning to deliver what American officials have described to Kathimerini as a “legacy speech” when he visits Athens on November 15. Although the details of the president’s trip have not been finalized, officials in Washington indicated that Obama intends to make a statement that resonates when he comes to Greece. One official likened it to the historic speech delivered by John F. Kennedy when he visited Berlin in 1962. Obama is expected to make extensive references to democracy and how it has endured in Greece despite its recent problems. The US president is also due to highlight the need for Athens to receive debt relief and for the Greek government to persist with structural reforms.

Obama is expected to tread carefully on the issue of debt so that his comments do not appear as an attack on German Chancellor Angela Merkel, who he considers an important partner and who he will be visiting after his trip to Athens. Sources said that the American president’s speech will also contain a message for Turkey. Obama wants to draw attention to the refugee crisis during his visit to Greece but due to security concerns a visit to the island of Lesvos has been ruled out. There is, however, a possibility that he will visit a refugee camp in Attica.

It is not yet known who will accompany the American leader on his visit but the impression is that First Lady Michelle Obama will not accompany him on the trip. There has been no final decision on whether Treasury Secretary Jack Lew will also travel to Athens. It is considered likely that Assistant Secretary of State for European and Eurasian Affairs Victoria Nuland and Special Envoy for International Energy Affairs Amos Hochstein will be part of the team that will fly to Greece from Washington.

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Prediction: “we” are going to let this run awfully out of control.

Erdogan Blasts West As Turkey’s Kurdish Party Boycotts Parliament (R.)

Turkish President Tayyip Erdogan accused Europe on Sunday of abetting terrorism by supporting Kurdish militants and said he did not care if it called him a dictator. Turkey drew international condemnation for the arrest on Friday of leaders and lawmakers from the pro-Kurdish Peoples’ Democratic Party (HDP), the second-largest opposition grouping in parliament, as part of a terrorism investigation. The government accuses the HDP, which made history last year by becoming the first Kurdish party to win 10% of the vote and enter parliament, of financing and supporting an armed Kurdish insurgency, which it denies. The HDP announced a partial boycott of parliament on Sunday, saying it was “halting its legislative efforts” and that its deputies would stop participating in sessions of the legislature or meetings of parliamentary commissions.

“I don’t care if they call me dictator or whatever else, it goes in one ear, out the other. What matters is what my people call me,” Erdogan said in a speech at an Istanbul university, where he was receiving an honorary doctorate. Erdogan and the government are furious at what they see as Western criticism of their fight against the Kurdistan Workers Party (PKK) militant group, which has waged a three-decade insurgency for Kurdish autonomy and whose allied groups in Syria enjoy U.S. support in the fight against Islamic State. Erdogan said the PKK, listed as a terrorist group by the EU and US, had killed almost 800 members of the security forces and more than 300 civilians since a ceasefire in the largely Kurdish southeast collapsed last year. [..] “Europe, as a whole, is abetting terrorism. Even though they declared the PKK a terrorist organisation, this is clear,” Erdogan said. “We see how the PKK can act so freely and comfortably in Europe.”

HDP co-leaders Selahattin Demirtas and Figen Yuksekdag were jailed pending trial on Friday after refusing to give testimony in a probe linked to “terrorist propaganda”. Ten other HDP lawmakers were also detained, though some were later released. The US expressed deep concern, while Germany and Denmark summoned Turkish diplomats over the Kurdish arrests. European Parliament President Martin Schulz said the actions “call into question the basis for the sustainable relationship between the EU and Turkey”. “After discussions with our parliamentary group and our central executive board, we have decided to halt our legislative efforts in light of everything that has happened,” HDP spokesman Ayhan Bilgen said in a statement read out in front of the party’s offices in Diyarbakir and broadcast online. HDP officials would consult with the party’s supporters, many of whom are in the largely Kurdish southeast, and could then consider a full withdrawal from parliament, he said.

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“Climate change is intergenerational theft.”

Great Barrier Reef: What Have We Left For Our Children? (Naomi Klein)

There is no question that the strongest emotions I have about the climate crisis have to do with Toma and his peers. I have flashes of sheer panic about the extreme weather we have already locked in for them. But even more intense than this fear is the sadness about what they won’t ever know. These kids are growing up in a mass extinction, robbed of the cacophonous company of being surrounded by so many fast-disappearing life forms. According to a new WWF report, since I was born in 1970 the number of wild animals on the planet has dropped by more than half – and by 2020 it is expected to drop by two-thirds. What a lonely world we are creating for these kids. And what more powerful place to illustrate that absence than the Great Barrier Reef, on the knife-edge of survival?

So this film shows the reef through Toma’s eyes. He’s too young to understand concepts like coral bleaching and dying – it’s tough enough for him to understand that coral was ever alive in the first place. It also shows the Great Barrier Reef through the eyes of his mother: moved by the beauty that remains, heartbroken and infuriated by what has been lost. Because what has happened to this wondrous part of the world is not just a tragedy, it’s a crime. And the crime is still very much in progress, with our respective governments busily clearing the way for new coalmines and new oil pipelines.

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Oct 292014
 
 October 29, 2014  Posted by at 11:41 am Finance Tagged with: , , , , , , , , , , , ,  


Russell Lee Photo booth at fiesta, Taos, New Mexico Jul 1940

Fed Set To End One Crisis Chapter Even As Global Risks Rise (Reuters)
How American QE Has Changed The World (Telegraph)
The Biggest Risk For US Investors Is A China Crash (MarketWatch)
Is China’s Export Boom Fake? (CNBC)
Another Reason Not to Trust China’s Economic Data (BW)
China Shadow Banking Shifted to Insurers Alarms Moody’s (Bloomberg)
US Homeownership Rate Drops To 1983 Levels (Zero Hedge)
Why British Interest Rates Will Never Go Up Again (MarketWatch)
EU Financial Transaction Tax Bid Falters on Revenue Disagreement (Bloomberg)
UK Faces ‘Debt Timebomb’ From Ageing Population (Telegraph)
Payday Loan Brokers Regularly Raid Bank Accounts Of Poor Customers (Guardian)
Dubai Insists the Boom is Not a Bubble This Time Around (Bloomberg)
Chinese Oil Trader Buys Record Number of Mideast Cargoes (Bloomberg)
Rajoy Apologizes as New Wave of Corruption Allegations Hits Spain (Bloomberg)
How The Consumer Dream Went Wrong (BBC)
Gross National Happiness – Can We Measure A Feelgood Factor? (Guardian)
Australia Protection Plan ‘Will Not Save Great Barrier Reef’ (BBC)
Blame The Cows: Kiwi Dollar May Stumble (CNBC)
Russia to Send 3,000 Tons of Aid to Eastern Ukraine Within Week (RIA)
Pope Francis: Evolution and Big Bang Theory Are Real (NBC)
Population Controls ‘Will Not Solve Environment Issues’ (BBC)

Mission accomplished.

Fed Set To End One Crisis Chapter Even As Global Risks Rise (Reuters)

– The U.S. Federal Reserve on Wednesday is expected to shutter its bond-buying program, closing one controversial chapter in its crisis response even as it struggles to manage a full return to normal monetary policy. The Fed is likely to announce at the end of a two-day meeting that it will no longer add to its holdings of Treasury bonds and mortgage-backed securities, halting the final $15 billion in monthly purchases under a program that at its peak pumped $85 billion a month into the financial system. An important symbolic step, the end of the purchases still leaves the Fed far from a normal posture.

Its balance sheet has swollen to more than $4 trillion, interest rates remain at zero, and, if anything, recent events have increased the risk the U.S. central bank may need to keep propping up the economy for longer than had been expected just a few weeks ago. The statement the Fed will issue at 2 p.m. will be read carefully for signs of how weak inflation, ebbing global growth and recent financial market volatility have influenced U.S. policymakers. There is no news conference scheduled after the meeting and no fresh economic forecasts from Fed officials. “They are worried about the economy, the global one,” and are likely to leave much of their language intact rather than signal progress towards a rate hike, Morgan Stanley analyst Vincent Reinhart wrote in a preview of the meeting.

Attention will focus on whether the Fed’s statement continues to refer to “significant” slack in the U.S. labor market, and whether it retains language indicating rates will remain low for a “considerable time,” as most economists expect. Paul Edelstein, director of financial economics at IHS Global Insight, said the Fed may also need to acknowledge the inflation outlook is weakening. “They have been kind of wrong about inflation lately,” Edelstein said. “It would behoove them to do something – signal to markets they are not going to tolerate inflation and inflation expectations persistently below 2%.” Fed officials have largely stuck to forecasts that the U.S. economy will grow around 3% this year, with inflation poised to move gradually back to their 2% goal.

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It has perverted just about all global economies for the benefit of banks and elites. As I said yesterday, perhaps that’s a touch of genius.

How American QE Has Changed The World (Telegraph)

The Federal Reserve is widely expected to end its asset purchasing programme today. If so, it will be a quiet end to one of the most radical monetary policy experiments in modern times. Since the financial crisis, the world’s biggest central bank has embarked on an unprecedented programme of asset purchases that has resulted in its balance sheet growing to more than $4.45 trillion. Under the most recent incarnation of monetary easing – dubbed “QE3” – the central bank has purchased around $1.6 trillion in government bonds and mortgage-backed securities. With QE3 now expected wind down, November could be the first time in more than 37 months that the Fed will not be dipping its toe in the securities market.

Here’s how QE has changed the global economy. In September 2012, the Fed announced it would be buying $40bn in mortgage-backed debt in addition to goverment bonds each month. At the time, the US economy was still in the midst of a fledgling recovery, while the eurozone crisis had begun to ease after Mario Draghi did his best to soothe markets. Then Fed chief Ben Bernanke announced the programme would be open-ended and contingent on improving conditions in the US labour market. In December last year, the central bank said that it would start to “taper” its purchases and buy fewer assets in each successive month. It has now decided the US economy is strong enough to and the stimulus altogether. Here’s why: Stubbornly high unemployment was one of the key reasons the Fed decided to embark on additional stimulative measures in 2012. Arguably, one the best indicators of the success of QE3 has been the fall in unemployment from more than 8pc, when the purchases began, to less than 6pc last month.

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“…if China’s economy slows, domestic consumption will start feeling the pain, leading to even less job creation and slower growth. That’s a feedback loop that will not end well for China.”

The Biggest Risk For US Investors Is A China Crash (MarketWatch)

There’s a lot of talk about how the U.S. stock market and the American economy will fare now that the Federal Reserve plans to end its bond-buying program. But the bigger risks are from overseas, namely a European slowdown and the threat of terrorism from ISIS in the Middle East. And the biggest risk for the next year is from China. Here’s why: China growth is falling fast: Last week, we learned that China’s gross domestic product growth rate for the third quarter was 7.3%, the slowest in five years. That’s down sharply from a peak of 11.9% in 2010 and below the 7.5% pace Beijing has been targeting. In fact, China has posted growth of 7.6% or higher dating back to 2000.

Domestic demand under pressure: Remember that China’s own policy makers estimate that 7.2% growth is running at about break-even. That’s because a growth rate that large is needed simply to create enough jobs — about 10 million annually — to support China’s massive (and still growing) population. Think of it this way: After the Great Recession, the U.S. returned to GDP expansion and even posted a respectable 2.5% growth rate in 2010 but, unfortunately, that didn’t necessarily mean much for American consumers or job-seekers that year. Or put another way, economists estimate about 2.2 million jobs must be created every year in the U.S. simply to ensure there’s work for a growing population of job-seekers. And China needs over four times that kind of growth. So if China’s economy slows, domestic consumption will start feeling the pain, leading to even less job creation and slower growth. That’s a feedback loop that will not end well for China, or investors in China stocks.

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Government created loopholes all over the place.

Is China’s Export Boom Fake? (CNBC)

Exports are regarded as the bright spot in China’s slowing economy, but growing evidence suggests mainland firms are “over-invoicing” outbound shipments, inflating the trade data, say economists. “When China’s external trade data for September came out two weeks ago, we were surprised by the apparent strength of exports. The Hong Kong trade data released [on Monday] suggests that renewed over-invoicing may be part of the reason for China’s strong September export data,” said Louis Kuijs, chief China economist at RBS. China’s exports rose 15.3% on year in September, beating a median forecast in a Reuters poll for a rise of 11.8%, following a 9.4% rise in August. In the same month, China reported that it exported $37.6 billion worth of goods to Hong Kong, while Hong Kong data revealed imports of just $24.1 billion, yielding an unusually large $13.5 billion gap.

“While there have always been discrepancies between the two sources on this trade flow, the discrepancy in September was equivalent to 4.3 percentage points of total export growth, the largest positive discrepancy since April 2013 during the previous round of over-invoicing,” said Kuijs. Widely seen in early 2013, over-invoicing is a technique by which companies inflate the value of exports, allowing them to evade capital controls and bring more funds into the country. Why is this happening? Last year, expectations of yuan appreciation seemed to be the key driving force. This year, the motivations appear to have shifted, said Kuijs. “One possible motivation could be that money was channeled to the Shanghai A-share market on expectations the A share market would rise after the launch of the Shanghai – Hong Kong Connect scheme,” he said. “Such flows may help to explain the rise in the A-share market index in September in the absence of obvious good economic or financial news,” he added.

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“…companies have “faked, forged, and illegally re-used” documents for exports and imports”

Another Reason Not to Trust China’s Economic Data (BW)

The numbers don’t match. In September, China exported $37.6 billion to Hong Kong, according to government data compiled by Bloomberg. For the same month, Hong Kong’s government says imports from the mainland amounted to only $24.1 billion. That’s this year’s biggest gap between Chinese and Hong Kong figures. Where did all those billions of dollars go? Julian Evans-Pritchard, Capital Economics’ China economist, called the results “very suspicious,” especially since the discrepancies are largely related to the trade of precious metals and stones. “It seems the Chinese customs are basically overvaluing these gems [and] these precious metals,” he told Bloomberg Television on Tuesday. Meanwhile, “Hong Kong customs are valuing them more accurately.” The China-Hong Kong discrepancy is just one example. Evans-Pritchard points to similar discrepancies regarding Chinese imports from South Korea. “

What appears to be happening [is] we have some round-tripping,” he said. Companies may be claiming to import the stones from Korea at a certain price and then export them to Hong Kong at a higher price, pocketing the difference. That helps companies evade Chinese government currency controls at a time when there’s renewed pressure to strengthen the yuan. With such conditions, “it makes a lot of sense” for Chinese companies to borrow money cheaply abroad and find ways to get that money into the country. The Chinese government is not blind to the problem. China has found almost $10 billion in fraudulent trades nationwide since April of last year, and companies have “faked, forged, and illegally re-used” documents for exports and imports, Wu Ruilin, a deputy head of the State Administration of Foreign Exchange’s inspection department, told reporters in Beijing in September.

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Dangerous development.

China Shadow Banking Shifted to Insurers Alarms Moody’s (Bloomberg)

A doubling in the trust holdings of China’s insurers has prompted ratings companies to warn the industry may be taking on too much shadow banking default-risk. Insurers held 281 billion yuan ($46 billion) of trust products on June 30, surging from 144 billion yuan at the end of last year, China Insurance Regulatory Commission data show. The companies’ shadow bank assets, including wealth management products and other financing kept off commercial lenders’ balance sheets, reached 1.14 trillion yuan, or 13% of their investments, Standard & Poor’s estimated, adding that this made them “vulnerable in times of stress.” China Pacific Life Insurance, Taiping Life Insurance and Du-Bang Property & Casualty Insurance all expanded trust investment fivefold or more in the first half, a “credit negative” for companies traditionally focused on fixed-income securities, according to Moody’s Investors Service. 51% of the trust investment was directed to real estate and infrastructure, making insurers vulnerable to a cooling property market, according to Fitch Ratings.

“If the insurers experience any liquidity problems, they won’t be able to easily turn these trust investments into cash,” said Sally Yim, a Moody’s analyst in Hong Kong. “These assets also tend to be more volatile. The yield may be higher, but there may also be defaults.” Chinese insurers’ assets doubled in the past five years to 9.6 trillion yuan last month, as premium income climbed an average of 14% annually. Squeezed by competition from wealth management products sold by banks and online funds, insurers started offering policies with investment characteristics to compete for money. “Over the last two or three years, banking product rates have been quite competitive compared with some of the rates offered by the insurers,” said Terrence Wong, a director at Fitch in Hong Kong. “So to enhance the yield, they have to seek investment instruments with higher returns.”

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More recovery.

US Homeownership Rate Drops To 1983 Levels (Zero Hedge)

The last time US homeownership declined down to 64.4% (which the Census Bureau just reported is what US homeownership declined to from 64.7% in Q2), was back in the fourth quarter of 1983. It goes without saying that this is about the bearishest news possible for those few who still believe in the American homewonership dream. Of course, those who have been following real-time rental market trends would be all too aware there is no rebound coming to the homeownership rate. The reason is simple: increasingly fewer can afford to buy, instead having no choice but to rent, which in turn has pushed the median asking rent to record highs.

In fact in the past two quarters, the asking rent was just $10 shy of its time highs at $756 per month. But capital allocation preferences aside, while explaining the disparity between rental and homeownership in a world where Renting is the new American Dream, what [this doesn’t explain] is why there is no incremental demand from all those millions of young Americans who enter the population and, eventually, the workforce. At least on paper. Earlier today, Bank of America was confused by precisely this:

Population growth of 25-34 year olds outpacing growth in the housing stock: The primary driver of household formation is population growth among 25 to 34 year olds. There is notable divergence with the growth in this age group and the growth in the housing stock. This suggests greater doubling up of households as a result of the recession and weak recovery. Unless doubling up turns into tripling up, household formation should recover over time, creating a need for greater building. Given tight credit conditions, this will tend to drive apartment construction more than single family construction. Either way, the housing stock is lagging well behind demographic fundamentals.

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Only, they will.

Why British Interest Rates Will Never Go Up Again (MarketWatch)

The autumn of 2014? Er, scratch that. The spring of 2015? Put that on the back burner. How about the autumn of 2015? For the moment, that seems to be the consensus. The markets have had plenty of dates that they penciled in for the first rate rise from the Bank of England. But each time one of them actually comes close, something comes along to blow it off course. It happened again this month. Analysts and economists in the City of London were confidently expecting the first rise sometime in the spring of next year. Then the plunge in the global markets of early October, combined with some disappointing economic data, meant that timetable was hurriedly reset. Here’s what is actually going to happen. Interest rates in the U.K. may not ever go up from the near-zero level of the last few years.

Japan cut its rates to those levels more than two decades ago and it is no closer to a rate rise now than it was in the mid-1990s. Sooner or later the penny is going to drop that rates are not going to go up, at least not in the working lives of most people in the market today. The timetable for the Bank of England to start moving interest rates back to normal levels is about as reliable as an Italian train. When Gov. Mark Carney moved from Canada to the U.K., he bought with him a policy of forward guidance, which was meant to give companies and consumers a clearer idea of where interest rates were heading. He set out criteria such as falling unemployment, and rising real wages, that would need to be met. But once those targets were hit, rates would start going up again.

There was certainly a lot to be said for that. It was on March 5, 2009, that the bank cut interest rates all the way down to 0.5%. At the time, it was presented as an emergency measure, designed to cope with deep recession bought on by the near collapse of the financial system a few months earlier. It was not presented as a normal rate, nor, at the time, is it likely that many of the members of the Monetary Policy Committee saw it that way either. They thought rates would stay at that level for a year or two, and then start to edge their way back towards normal. The trouble is, the right moment never seems to arrive. Despite heavy signaling through last spring that a rate rise was likely before the end of 2014, it hasn’t happened.

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It’s now become a joke.

EU Financial Transaction Tax Bid Falters on Revenue Disagreement (Bloomberg)

The European Union must figure out how to handle revenues from a proposed financial-transaction tax to meet a year-end deadline for moving ahead with the levy in participating nations. Ten nations pledged in May to seek agreement on a “progressive” tax on equities and “some derivatives” by the end of 2014, with implementation planned for a year later. As that deadline approaches, nations have found broad agreement on how to handle equities, according to an Oct. 27 planning document obtained by Bloomberg News. Derivatives and revenues are the biggest obstacles to moving forward with a proposed tax by year end, according to Italy, one of the participating nations and also current holder of the EU’s rotating presidency. National officials are due to discuss the tax plan this week, ahead of a Nov. 7 finance ministers’ meeting in Brussels. Italy proposed three possible models for shifting revenue from countries where transactions take place to nations where the trading firms are based, so that countries with smaller financial sectors wouldn’t be at a disadvantage.

This would allow the tax to be collected in the country of issuance, then allocated to take account of other parameters like residence. “Delegations could not agree on the solution of revenue distribution that would be acceptable to all of them,” according to the planning document. Willing nations are considering how to build the first phase of a trading tax, with an eye toward expanding it in future years. EU policy makers have considered a transactions tax to raise money and discourage speculative trading, goals that have gained urgency since the financial crisis and the euro-area budget rules adopted in its wake. Efforts to build a common tax for all 28 member nations fell apart, followed by a scaled back proposal for a joint tax among 11 willing nations. The plans have been criticized by banks and trading firms, which have warned that could curtail investment at a time when the EU is seeking to boost anemic economic growth.

“The FTT is about the worst idea of the last three centuries,” Wim Mijs, chief executive of the European Banking Federation, a Brussels-based industry group, told reporters yesterday. In some countries, the “cost of implementing it is higher than the possible gain,” he said. [..] Most participating nations are in favor of including equity derivatives, so that trading in equities doesn’t immediately jump to a non-taxed transaction. Still, some nations want to exclude equity derivatives, the document showed. Some nations want to tax credit default swaps. Other nations have concerns about interest-rate derivatives because these trades have ties to monetary policy and government bonds.

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Many nations do.

UK Faces ‘Debt Timebomb’ From Ageing Population (Telegraph)

Britain’s ageing population has created a “debt timebomb” that can only be defused through a combination of significant spending cuts, faster increases in the state pension age and ending universal free healthcare, according to a respected think-tank. The Institute of Economic Affairs (IEA) warned that the Government would need to slash public spending by a quarter in order to get Britain’s debt mountain down to sustainable levels. In a set of radical proposals, the IEA called on the Government to end “unhelpful” policies such as the “triple lock guarantee” that ensures the state pension increases by the higher of inflation, average earnings or a minimum of 2.5pc every year. It also said charging for some NHS services would help to reduce demand.

The IEA calculated that Government spending cuts equivalent to 9.6pc of GDP – or £168bn per year in today’s money – were needed to reduce Britain’s debt-to-GDP ratio to 20pc by 2063. This is equivalent to cutting the health, welfare and pensions budgets in half, or overall spending by a quarter. “Politicians must wake up to the size of the debt time bomb in the UK. Older generations have voted themselves benefits that will indebt future generations, meaning crippling tax hikes for our children and grandchildren,” said Philip Booth, editorial director at the IEA. “Very significant spending restraint and reform of entitlements will be required in the next parliament and beyond to get our debt levels back under control.” While the think-tank welcomed the measures introduced by the Government to link the state pension age to life expectancy and commit to a further £67bn worth of austerity by 2018-19, it said that without further reforms, debt would continue to rise in the long-term.

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How is this possible? Why do we condone preying on the poor?

Payday Loan Brokers Regularly Raid Bank Accounts Of Poor Customers (Guardian)

A new breed of payday loan brokers are making as many as 1m attempts per month to raid the bank accounts of some of the poorest members of society. The behaviour is provoking alarm at one of Britain’s biggest high street banks, Natwest, which says it is being inundated with complaints from its most vulnerable customers. NatWest said it is seeing as many as 640 complaints a day from customers who say that sums, usually in the range of £50 to £75, have been taken from their accounts by companies they do not recognise but are in fact payday loan brokers. The brokers are websites that promise to find loans, but are not lenders themselves. Often buried in the small print is a clause allowing the payday broker to charge £50 to £75 to find the person a loan – on top of an annual interest charge as high as 3,000%. In the worst cases, the site shares the person’s bank details with as many as 200 other companies, which then also attempt to levy charges against the individual.

The City regulator has received a dossier of information about the escalating problem, and the Financial Ombudsman Service also confirmed that it is facing a wave of complaints about the issue. NatWest, which is owned by the Royal Bank of Scotland, gave as an example a 41-year-old shop assistant who took a payday loan of £100 at 2,216% interest. A month later she complained to NatWest after seeing a separate fee of £67.88 paid to My Loan Now and £67.95 to Loans Direct on her account, companies she said she had never dealt with. The broker sites tell customers they need their bank account details to search for a loan, but then pass them on to as many as 200 other brokers and lenders, which then seek to extract fees, even if they have not supplied a loan. The small print allowing the site to pass on the details and demand payments can be hidden in the site’s ‘privacy policy’ or in small print at the bottom of the page.

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Sure.

Dubai Insists the Boom is Not a Bubble This Time Around (Bloomberg)

Alongside the Dubai Mall, one of the world’s largest shopping centers, sits an ersatz version of what would be an authentic retail experience in most Persian Gulf cities: an Arab souk. If, in the evening, you stroll through this air-conditioned, hassle- and haggle-free caricature of a market, staffed mostly by smiling South Asians, you can amble out onto the shores of man-made Burj Khalifa Lake, named after the world’s tallest building, which looms over it. Here – bumping elbows with a veritable United Nations General Assembly of residents and tourists decked out in everything from dishdashas to Dior – you can gawk at the Dubai Fountain, Bloomberg Markets magazine will report in its December issue. Every half-hour, an array of computer-choreographed nozzles sends jets of water erupting from the lake’s surface 500 feet into the air, gyrating to Middle Eastern pop one minute and Andrea Bocelli singing “Con Te Partiro” the next.

Awash in fantasia, this metropolis of glass and steel sprouting from the barren sands of the Arabian Peninsula often seems nothing more than an illusion born of desert heat. Never was Dubai more miragelike than five years ago, after the global financial crisis crushed what had been a bastion of wealth and growth. House prices plunged as much as 60%. Half of the city’s $582 billion in construction projects were either placed on hold or abandoned, their incomplete steel skeletons left poking from the sand, a 21st-century Ozymandias. Now, Dubai is booming again. To understand why, journey 20 miles (32 kilometers) from the Dubai Mall to a part of the city few tourists ever see. Here, if you pass through the security gates at Jebel Ali port, you’re treated to another mesmerizing mechanical ballet – one less ephemeral and arguably more important to the city-state’s fate than the Dubai Fountain’s dancing waters. Towering gantry cranes sidle up to 1,200-foot-long (365-meter-long) container ships bound for Mumbai or Singapore or Rotterdam.

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“The big question is what China will do with all of these cargoes…”

Chinese Oil Trader Buys Record Number of Mideast Cargoes (Bloomberg)

China National United Oil Co., a unit of the country’s biggest energy company, bought the most ever cargoes of Middle East crude through a pricing platform in Singapore amid oil’s slump into a bear market. The company, known as Chinaoil, purchased about 21 million barrels this month through the system used to determine benchmark prices by Platts, a unit of McGraw Hill Financial Inc. It bought more than 40 cargoes of the Dubai, Oman and Upper Zakum grades in the so-called window, according to data compiled by Bloomberg. A Beijing-based press officer for CNPC, the parent company, wasn’t immediately able to comment and asked not to be identified because of internal policy. “It’s very difficult for the market to know Chinaoil’s strategy,” Ehsan Ul-Haq, a senior market consultant at KBC Energy Economics in Walton-on-Thames, England, said by phone.

“Prices have gone down and China is always interested in buying more crude whenever the price is right, but they could also have some other different trading strategy.” Benchmark oil prices tumbled to the lowest in almost four years this month amid signs of an expanding global supply glut, led by the highest U.S. production in about three decades. China consumed the second-largest amount of crude ever last month and its stockpiles increased to a record. Some of Chinaoil’s cargoes may be used to fill the country’s strategic crude reserves, according to JBC Energy GmbH, a Vienna-based consultant. “The big question is what China will do with all of these cargoes,” JBC said in an e-mailed report Oct. 21. “If the Middle Kingdom puts the barrels into strategic storage, something that would be logical given low outright prices, they will disappear entirely from the market and China will still have to buy more crude for its day-to-day needs.”

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How corrupt is the government that’s supposed to fight corruption?

Rajoy Apologizes as New Wave of Corruption Allegations Hits Spain (Bloomberg)

Prime Minister Mariano Rajoy apologized to the Spanish people yesterday amid mounting public outrage at a new wave of corruption allegations against officials from his party. All members of the governing People’s Party among the 51 arrested this week on bribery allegations have had their party membership suspended and will be expelled if the charges are proved, Rajoy told the Senate in Madrid. “I understand and share fully the indignation of so many Spaniards at the accumulation of scandals,” Rajoy said. “In the name of the People’s Party I want to apologize to all Spaniards for having appointed to positions for which they were not worthy those who would seem to have abused them.”

Rajoy is battling to retain his moral authority amid evidence that local officials took bribes to hand out public contracts while he was administering the harshest budget cuts in Spain’s democratic history. This week’s arrests follow allegations from the former PP treasurer, Luis Barcenas, that Rajoy and other senior party officials including Rodrigo Rato, a former deputy prime minister, accepted cash from a party slush fund. Rajoy has denied the allegations against him. Barcenas produced handwritten ledgers to back up his claims that he handed out envelopes of cash to party officials and received text messages of support from Rajoy during the early part of the investigation. He’s in jail while the National Court probes his financial affairs.

A survey by the state pollster in July showed political corruption is the second-biggest concern for Spaniards after the country’s 24% unemployment rate, the second highest in the European Union. “Explain about the envelopes, explain about the messages you sent to Barcenas, explain about the secret financing of your party,” the opposition Socialist leader in the Senate, Maria Chivite, told Rajoy in response. “Explain to all Spaniards how many senior official from your party will appear before the courts because of their accounts in Switzerland.”

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It’s not like we we born as consumers.

How The Consumer Dream Went Wrong (BBC)

We could, it seemed, have it all. So what went wrong? The truth is this: despite all its promise, the idea of the Consumer is killing us. And before it does, we must kill it. I can perhaps best explain why the golden dream went so wrong by describing one of a series of recent experiments that have explored the effect of this word on our behaviour. The simplest was a survey of environmental and social attitudes and values. The group taking the survey was split in half. For half, the front cover said Consumer Reaction Study, for the rest, Citizen Reaction Study. No specific attention was drawn to this and there was no other significant difference between the two groups; just this one word. Yet those who answered the Consumer Reaction Study were far less motivated to care about society or the environment.

That pattern has been seen elsewhere, and the only possible explanation for the difference is the unconscious effect of merely being exposed to the language of the Consumer as a prime, a kind of mental framing of the task at hand. How can this be? Can a word, just a word, really make us less likely to care about one another and about the world, and less likely to trust and work with one another to fix it? Here’s the thing – nothing is “just a word”. Language is the scaffolding on which we build our thoughts, attitudes, values and behaviours. And as we do so, we would do well to recognise that the Consumer is a deeply dangerous place to start. Because what looks at surface level like a word is in fact a moral idea, an idea of what the right thing is for us to do in our daily lives. This word Consumer represents the idea that all we can do is consume, choosing between the options offered us, and that the morally right thing for us to do is to pick the best of these for ourselves, measured in material standards of living, as narrowly defined individuals, and in the short term.

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But we can be happy only as consumers these days.

Gross National Happiness – Can We Measure A Feelgood Factor? (Guardian)

The UK economy continues to recover, albeit at a slower pace, the latest official figures show. But how well does this reflect how people are feeling? GDP measurements only provide part of the picture and so the Office for National Statistics will soon reveal details of a new set of supplementary indicators on economic well-being. It follows a pledge by the prime minister, David Cameron, in 2010 to make the UK one of the first countries to officially monitor happiness. The inaugural release including how households are doing, how well-off people feel and other insights into well-being will be published just in time for Christmas on 23 December.

Bhutan is the real trailblazer in this area. The tiny nation to the east of the Himalayas has long been renowned for its focus not on GDP – gross domestic product – but GNH (gross national happiness). In other words, what matters to Bhutan more than upping production and improving productivity is whether its citizens are happy. It’s a measure the remote south Asian nation has been using since the early 1970s, well before the rest of the world began to realise that wealthier does not necessarily translate into happier. The ONS says its new regular well-being release will help businesses, households and policymakers in the UK make better-informed decisions by providing a whole “dashboard” of indicators on the state of the economy.

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They’re not trying.

Australia Protection Plan ‘Will Not Save Great Barrier Reef’ (BBC)

Australia’s Academy of Science says an Australian government draft plan to protect the Great Barrier Reef will not prevent its decline. The group said the Reef 2050 Long-Term Sustainability Plan failed to address key pressures on the reef including climate change and coastal development. Much bolder action was needed, said Academy Fellow Professor Terry Hughes. “The science is clear, the reef is degraded and its condition is worsening,” said Prof Hughes. “This is a plan that won’t restore the reef, it won’t even maintain it in its already diminished state,” he said in a statement released on Tuesday. “It is also more than disappointing to see that the biggest threat to the reef – climate change – is virtually ignored in this plan.”

Public submissions on the draft plan – an overarching framework for protecting and managing the reef from 2015 to 2050 – closed on Monday. The plan will eventually be submitted to the World Heritage Centre in late January, for consideration by Unesco’s World Heritage Committee mid-next year. Unesco has threatened to place the reef on its List of World Heritage in Danger. According to scientists, another major threat to the reef’s health is continual expansion of coal ports along the Queensland coast. In a controversial move earlier this year, the Australian government approved a plan to dredge a port at Abbot Point in Queensland, and dump thousands of tonnes of sediment in the sea.

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New Zealand needs to diversify away from export-driven monoculture, and towards its own domestic market.

Blame The Cows: Kiwi Dollar May Stumble (CNBC)

Once billed as the hottest currency trade this year, New Zealand’s dollar is set to stumble, tripped up by spilled milk. “Since peaking in February this year, international dairy prices per Fonterra Global Dairy Trade (GDT) auction have fallen by almost 50%,” Morgan Stanley said in a note Tuesday, noting that dairy products are New Zealand’s largest export, accounting for 26.4% of the total. “Due to New Zealand’s specialization in whole milk powder (WMP) exports to China, we expect the fall in price and import demand to weigh on the New Zealand dollar,” the note said. It’s a turnaround from the beginning of the year, when analysts had expected strong gains in the kiwi. BK Asset Management in January called the New Zealand dollar, also known as the kiwi, one of its favorite trades for the year, citing expectations the central bank would hike interest rates and increased demand for “soft commodities.”

After starting the year around $0.8221, the kiwi climbed to highs of over $0.88 in July, but it has since stumbled, fetching around $0.79 in early Asia trade Wednesday. Dairy prices face a lot of headwinds, likely keeping milk prices depressed for a while. “We expect the recent peak in dairy prices, the lift of EU dairy quota and lower feed costs to increase global milk production,” Morgan Stanley said, noting the USDA forecasts global dairy export volume to rise 10% in 2014. The EU dairy quota system, which fined countries for surplus production over a delivery quota, is set to be scrapped after the first quarter of next year, and Morgan Stanley noted that farmers there have already begun increasing their cow counts. While New Zealand will likely continue to dominate WMP exports to China, media reports indicate the mainland’s inventories are stocked up and lower prices aren’t likely to spur additional demand, the note said.

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By plane as well…

Russia to Send 3,000 Tons of Aid to Eastern Ukraine Within Week (RIA)

Russia will send up to 3,000 metric tons of humanitarian aid to Ukraine’s southeastern regions within a week, Russian Deputy Emergencies Minister Vladimir Stepanov told RIA Novosti Tuesday. “Within a week the total weight of humanitarian aid will amount to 3,000 metric tons,” Stepanov said, adding that it will be delivered both by aircraft and land vehicles. According to Stepanov, on Tuesday three aircraft will deliver part of the aid to the Russian city of Rostov-on-Don, where it will be loaded onto trucks. The aid includes food, medicine and construction materials that will help residents of southeastern Ukraine to prepare for the winter.

The deliveries of aid to Ukraine are being carried out in coordination with the Red Cross and the Russian Foreign Ministry. Earlier today, Russia’s Emergency Ministry confirmed that on October 28 a convoy of up to 50 trucks carrying humanitarian aid for the people of Donetsk and Luhansk regions will depart from the city of Noginsk. Since August, Russia has sent three humanitarian convoys of trucks carrying food, water, power generators, medication and warm clothes to eastern Ukrainian regions, which went through a severe humanitarian crisis due to the military operation initiated by Kiev’s authorities in April.

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Is he talking about TV series?

Pope Francis: Evolution and Big Bang Theory Are Real (NBC)

Big Bang theory and evolution in nature “do not contradict” the idea of creation, Pope Francis has told an audience at the Vatican, saying God was not “a magician with a magic wand.” The Pope’s remarks on Monday to the Pontifical Academy of Sciences appeared to be a theological break from his predecessor Benedict XVI, a strong exponent of creationism. “The beginning of the world is not the work of chaos that owes its origin to something else, but it derives directly from a supreme principle that creates out of love,” Pope Francis said.

“The Big Bang, that today is considered to be the origin of the world, does not contradict the creative intervention of God; on the contrary, it requires it. Evolution in nature is not in contrast with the notion of [divine] creation because evolution requires the creation of the beings that evolve.” The Pontiff said God created beings “and let them develop in accordance with the internal laws that he has given to each one.” He said: “When we read in Genesis the account of creation [we are] in danger of imagining that God was a magician, complete with a magic wand that can do all things. But he is not.”

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Not a problem for us to solve.

Population Controls ‘Will Not Solve Environment Issues’ (BBC)

Restricting population growth will not solve global issues of sustainability in the short term, new research says. A worldwide one-child policy would mean the number of people in 2100 remained around current levels, according to a study published in the Proceedings of the National Academy of Sciences. Even a catastrophic event that killed billions of people would have little effect on the overall impact, it said. There may be 12 billion humans on Earth by 2100, latest projections suggest. Concerns about the impact of people on the planet’s resources have been growing, especially if the population continues to increase. The authors of this new study said roughly 14% of all the people who ever existed were alive today.

These growing numbers mean a greater impact on the environment than ever, with worries about the conversion of forests for agriculture, the rise of urbanisation, the pressure on species, pollution, and climate change. The picture is complicated by the fact that while the overall figures have been growing, the world’s per-capita fertility has been declining for several decades. The impact on the environment has increased substantially, however, because of rising affluence and consumption rates. Many experts have argued the best way of tackling this impact is to facilitate a rapid transition to much lower fertility rates.

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