Aug 152020
 


Henri Cartier Bresson Boucher, Les Halles de Paris 1952

 

Former FBI Lawyer To Plead Guilty In Durham’s Trump-Russia Probe (ZH)
In Bringing First Russiagate Charge, Durham Hints At Other Crimes (JTN)
Bill Gates Says Hydroxychloroquine Has ‘Severe Side Effects’ (JTN)
Joe Biden Calls For Nationwide Facemask Mandate (KABC)
The President Was Not Encouraging: What Obama Really Thought About Biden (Pol.)
Appeals Court Spares Hillary Clinton From Deposition In Email Scandal (JTN)
Yes, Kamala Harris Is Eligible For Vice President (Turley)
UPS, FedEx Reject Calls To Handle Mail-In Ballots: Significant Problems (Hill)
California Judge Sides With Church, Allows Indoor Services (WT)
Warren Buffett Sheds Big Stakes In Banks And Goes For The Gold (Fox)
Trump: ‘A Lot Of People’ Think Edward Snowden ‘Not Being Treated Fairly’ (NYP)
Chaos In Assange Case Management Hearing (DEAssange)

 

 

As for US politics, I already wrote the core of it for a few articles below.

The “Russia Investigation Investigation”. Yes, it’s come to this.

Briefing for a descent into complete chaos post-Nov 4.

Doris Lessing’s original book title is “Briefing for a Descent into Hell”. Could use that one too. Take your pick.

 

 

Well, there’s one bright spot, perhaps: US new deaths are getting lower. And now it’s weekend again.

 

 

 

 

 

 

 

 

 

 

 

 

The “Russia Investigation Investigation”. Yes, it’s come to this.

The MSM has also picked it up, trying to claim Clinesmith was some kind of lone cowboy.

Former FBI Lawyer To Plead Guilty In Durham’s Trump-Russia Probe (ZH)

Former FBI lawyer Kevin Clinesmith will plead guilty to one count of making a false statement regarding his involvement in the agency’s actions against the Trump campaign during the 2016 US election, according to the Associated Press. In November, the New York Times revealed that Clinesmith was under criminal investigation for allegedly doctoring materials used to obtain renewals of the Carter Page surveillance warrant. Clinesmith -who worked on both the Hillary Clinton email investigation and the Russia probe, was part of Special Counsel Robert Mueller’s team, and interviewed Trump campaign advisor George Papadopoulos.

Clinesmith, a 37-year-old graduate of Georgetown Law, “took an email from an official at another federal agency that contained several factual assertions, then added material to the bottom that looked like another assertion from the email’s author, when it was instead his own understanding,” according to the report. “Mr. Clinesmith included this altered email in a package that he compiled for another F.B.I. official to read in preparation for signing an affidavit that would be submitted to the court attesting to the facts and analysis in the wiretap application. The details of the email are apparently classified and may not be made public even when the report is unveiled.” -New York Times

Clinesmith was identified by Inspector General Michael Horowitz as one of several FBI officials who harbored animus towards President Trump, after which he was kicked off the Mueller Russia investigation in February 2018. Two other FBI officials removed for similar reasons were Peter Strzok and Lisa Page, both of whom also worked on the Clinton and Trump investigations, and both of whom have similarly left the bureau. On November 9, 2016 – the day after Trump won the election, Clinesmith texted another FBI employee “My god damned name is all over the legal documents investigating his staff,” adding “So, who knows if that breaks to him what he is going to do.”

A former attorney with the FBI’s National Security and Cyber Law Branch while working under FBI’s top lawyer, James Baker, Clinesmith resigned in September 2019 after he was interviewed by Horrowitz’s office. Horrowitz in turn sent a criminal referral to US Attorney John Durham, who was tasked with investigating the Obama DOJ’s conduct surrounding the 2016 US election. Durham was appointed by Barr last May to examine the FBI’s actions against the Trump campaign during and after the 2016 US election, code named “Crossfire Hurricane.” Specifically, Durham has been probing whether Obama administration officials illegally collected intelligence on the Trump campaign, and whether the agency’s surveillance of campaign aides was free of improper motive.

“They spied on my campaign, which is treason. They spied both before and after I won. Think of that. Using the intelligence apparatus of the United States to take down a president,” Trump said recently during a live phone interview with Fox Business, adding “It’s the single biggest political crime in the history of our country.”

Read more …

They all knew Page was a CIA asset since August 2016 at the latest, but failed to tell the FISA court, because none of the warrants would have been approved. How obvious do we have to make it?

In Bringing First Russiagate Charge, Durham Hints At Other Crimes (JTN)

Spygate, once derided by media and political elites as a fringe conspiracy theory, is now fact thanks to a court filing that confirms an ex-FBI lawyer who disliked President Trump falsified evidence that was used to keep surveillance against Trump associates going. U.S. Attorney John Durham filed the felony charge Friday against Kevin Clinesmith, and the ex-FBI assistant general counsel is expected to plead guilty soon and cooperate with the ongoing investigation of the Russia investigators. That alone is significant, since Clinesmith was witness to other controversial moments in the failed Trump-Russia collusion probe, including an operation to spy on the future president during a counterintelligence briefing in summer 2016.

But within the four-plus page criminal information filed in U.S. District Court, Durham also laid out evidence of an additional crime that could be prosecuted in the coming weeks. The court filing notes that Clinesmith “willfully and knowingly” altered a document in June 2017 to falsely claim that Trump campaign adviser Carter Page — one of the main targets of the Russia collusion probe and identified in the court document as “Individual #1” — was not a source for the CIA, identified in the court documents as “Other Government Agency” or “OGA.” In reality, Page was a CIA asset. The filing says Clinesmith’s misdeed caused the FBI to mislead the Justice Department and the FISA court when filing an application for the last of four surveillance warrants that targeted Page for over a year.

But Durham also reveals in the filing that the FBI Crossfire Hurricane team — led by since-fired Agent Peter Strzok — had already been told of Page’s relationship with the CIA all the way back in August 2016 and failed to tell the FISA court that essential information about Page before the three prior FISA warrants were approved. Such a failure is known as a material omission because the FBI was claiming they believed Page was an agent of Russia when in fact he was an asset of the U.S. government helping to inform on Russian intelligence targets. In other words, had the FBI not omitted the truth, the judges would have known before they approved even the first FISA warrant that Page was a CIA-handled source, not a Russian stooge.

Here’s how Durham worded the account: “On Aug 17, 2016, prior to the approval of FISA #1, the OGA (CIA) provided certain members of the Crossfire Hurricane team a memorandum indicating that Individual #1 (Page) had been approved as an operational contact for the OGA (CIA) from 2008 to 2013 and detailing information that Individual #1 (Page) had provided to the OGA (CIA) concerning Individual #1’s prior contacts with certain Russian intelligence officers. The first three FISA applications did not include Individual #1’s history or status with the OGA (CIA).” Several experts said Durham’s inclusion of the earlier notification signals he has concerns others may also have been involved in deceiving the court.

“It’s more than an oversight. Whether the omission was purposeful or not, it is a fraud on the court,” said Kevin Brock, the FBI’s former assistant director for intelligence and the man who created many of the procedures the bureau still uses to investigate intelligence threats. “At the risk of sounding like Captain Obvious, I think it is clear that Durham is positioning a deeper dive into this issue of FISA application abuse,” Brock added. [..] In one instance the day after Trump won, Clinesmith texted this anti-Trump, anti-Mike Pence screed: “The crazies won finally. This is the tea party on steroids. And the GOP is going to be lost, they have to deal with an incumbent in 4 years. We have to fight this again. Also Pence is stupid,” he wrote in a text quoted by the inspector general.

Read more …

Why would anyone care what he thinks?

Bill Gates Says Hydroxychloroquine Has ‘Severe Side Effects’ (JTN)

Bill Gates this week added more flame to the fire in the ongoing debate over the usage of hydroxychloroquine to treat COVID-19, claiming that using the drug to treat the coronavirus carries with it the risk of “severe side effects” and arguing that medical officials should instead pursue the numerous “good therapeutic drugs” currently in development. Yet there is at present little evidence that “severe side effects” are common in COVID-19 patients who take hydroxychloroquine, with the majority of reported adverse events being relatively mild and only a small fraction of reported effects so far being dangerous and/or fatal.

The drug, which has been used for years to treat malaria and other conditions like lupus, has been at the center of a medical and political firestorm since March when President Trump touted the medicine as a possible effective treatment for coronavirus. Numerous medical officials have claimed that it offers no benefit to COVID-19 patients, while others have insisted that it is highly effective when used in certain circumstances, specifically on high-risk patients early in the course of the disease. Asked by Bloomberg magazine about the controversy on Thursday, Gates—who has been at the forefront of funding and advocacy efforts to find both a cure and a vaccine for COVID-19—said that though we live “in age of science … sometimes it doesn’t feel that way.”

“In the test tube, hydroxychloroquine looked good,” he said. “On the other hand, there are lots of good therapeutic drugs coming that are proven to work without the severe side effects.” Numerous studies across the world over the past several months have produced mixed results on the efficacy of hydroxychloroquine in treating COVID-19, with some showing marked benefits and others indicating that it does not help patients recover from the disease. Yet regardless of study outcomes, severe adverse health events associated with the drug appear to be comparatively rare. One randomized trial published in the New England Journal of Medicine earlier this month stated that, while the study’s treatment with hydroxychloroquine “did not prevent illness compatible with Covid-19 or confirmed infection,” there were nevertheless “no serious intervention-related adverse reactions or cardiac arrhythmias” reported by study participants.

Read more …

Biden’s handlers know that many Trump supporters are against masks, so they make him call for masks everywhere in order to create conflict.

Joe Biden Calls For Nationwide Facemask Mandate (KABC)

Presumptive Democratic presidential nominee Joe Biden is calling for a nationwide mask mandate. After getting a briefing from some healthcare professionals in Wilmington, Delaware, Biden said all Americans should be wearing facemasks outside their homes for the next three months. He did not give any details on enforcement, legality or science. The former VP stressed – without citing any evidence–that it will save up to 40-thousand lives. Biden said it’s not an issue of personal rights. He insisted that it’s about personal responsibility and patriotic duty. Biden’s new running mate Kamala Harris said — “That’s what real leadership looks like.” They spoke for a total of about 8 minutes and refused to take questions.

Read more …

Power games amongst so-called friends. Meanwhile, Hillary apparently said she might “serve” in a Biden cabinet.

The President Was Not Encouraging: What Obama Really Thought About Biden (Pol.)

Biden’s own academic career was unimpressive—he repeated the third grade, earned all Cs and Ds in his first three semesters at the University of Delaware except for As in P.E., a B in “Great English Writers” and an F in ROTC, and graduated 76th in his Syracuse Law School class of ’85. He’s the first Democratic nominee since Walter Mondale in 1984 not to have an Ivy League degree. He was not a binder person, Clinton and Obama aides said. Biden admitted as much in his 2007 memoir Promises to Keep, writing “It’s important to read reports and listen to the experts; more important is being able to read people in power.” Biden’s tendency to blurt out whatever was on his mind rankled Obama, who wasn’t afraid to needle him for it.

In his first press conference in 2009, the young president quipped “I don’t remember exactly what Joe was referring to—not surprisingly,” when asked about Biden’s assessment that there was a 30 percent chance they could get the economic stimulus package wrong. The gaffes were only one side of the story, though. Obama warmed both to Biden’s effusive personality and his skill in implementing the administration’s $787 billion economic stimulus package, which the president had delegated to him. Aides recall that Obama and Biden took almost polar-opposite approaches to policymaking, Obama always seeking data for the most logical or efficient outcome, while Biden told stories about how a bill would affect the working-class guy in Scranton, Pennsylvania, where he was born.

[..] Panetta, who had known Clinton from his days as her husband’s White House chief of staff, recalled that “Both she and her staff worked at that a great deal in trying to build that support.” Among Obama and his aides, Panetta said, “I think there was a certain attraction to someone that would certainly break ceilings and kind of create the same kind of precedent that he created when he became president … as opposed to supporting somebody who’s kind of your more traditional politician and, you know, a white Irish Catholic guy.” There was also dismissiveness of Biden in Clinton’s orbit that echoed Obama aides.

“The good thing about a Biden run,” Neera Tanden, Clinton’s close aide who also advised the Obama administration on health policy, wrote to Podesta in 2015, in an email later exposed by WikiLeaks, “is that he would make Hillary look so much better.” Obama tried to remain above the fray, even as his closest staffers largely rallied around Clinton—which they likely would not have done if there was a chance he would support Biden. “I knew a number of the president’s former staffers, and even a few current ones, were putting a finger on the scale for Clinton,” Biden wrote. Pressed on whether Obama ever expressed a preference between Clinton and Biden, Jarrett demurred, saying, “that’s a conversation you’ll have to have with him.” Obama declined to be interviewed through his spokesperson.

“President Obama has been unequivocal in his respect for Joe’s wisdom, experience, empathy and integrity,” the spokesperson said in a statement. Even if he did express preference for Clinton, some Obama officials characterized it more as an acknowledgment of her strength than an attempt to undercut Biden. “There was a feeling of inevitability about Hillary Clinton in every aspect,” recalled Psaki. “So it never felt to me like it was Obama choosing Hillary Clinton over Joe Biden. It was a feeling like it’s inevitable after Hillary Clinton left the State Department that she will be the Democratic nominee, and she will become the next president. So Obama … was trying to play a part in being helpful.” Reines said Obama “was always very encouraging” of Clinton and that after serving as president, “he believed there was no one better prepared to do it.”

Read more …

The doors shut tight behind Hillary.

Appeals Court Spares Hillary Clinton From Deposition In Email Scandal (JTN)

Four-plus years after the James Comey-led FBI chose not to file charges against Hillary Clinton, despite evidence she transmitted classified information on an insecure email server, a federal appeals court Friday gave the former secretary of state another legal pass in the case. A three-judge panel of the D.C. Circuit Court of Appeals granted a writ of mandamus requested by Clinton’s lawyers overturning a judge’s order that she submit to a sworn deposition in a Freedom of Information Act case brought by the conservative watchdog group Judicial Watch. The court ruled that U.S. District Judge Royce Lamberth erred in ordering the deposition in the first place.

“Discovery in FOIA cases is not a punishment, and the district court has no basis to order further inquiry into Secretary Clinton’s state of mind,” the appeals court ruled. Judicial Watch had sought to secure the deposition to explore whether Clinton’s use of the private server to transmit government documents was an effort to evade the legal requirements of the FOIA law. The group said Friday afternoon it is reviewing whether to appeal. “We’re disappointed and considering our options,” Judicial Watch’s Tom Fitton told Just the News. The court ruling comes four years and one month after Comey announced on July 5, 2016 that he had unilaterally decided not to seek criminal charges against Clinton for transmitting highly classified information on her private email server.

Comey was later fired from his post and an inspector general ruled the FBI director had wrongly “usurped” the Justice Department’s authority to decide whether charges should have been filed. It was that very same day that former MI-6 agent Christopher Steele — working on behalf of Clinton’s opposition research efforts — walked the first piece of information of his now infamous anti-Trump dossier into the FBI office in London.

Read more …

“..Congress inserted the words “and subject to the jurisdiction thereof.” Those six words have perplexed scholars for 150 years.”

But being perplexed by them today is racist.

Yes, Kamala Harris Is Eligible For Vice President (Turley)

Birthright citizenship has been a subject of debate from the time that the 14th Amendment was adopted. There are arguments on both sides of the currently accepted broad interpretation of the language. Many of our closest allies reject the concept of birthright citizenship. However, the case law strongly supports Harris. In 1898, in United States v. Wong Kim Ark, the court found that the child of Chinese immigrants was still a citizen under the 14th Amendment because he was born on U.S. territory. His parents were here legally as permanent residents. Moreover, the language of the 14th Amendment does not clearly support the exclusions raised by Eastman. It states “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside.”

Most reading that language have concluded that it allows for birthright citizenship for anyone “born … in the United States.” The 14th Amendment starts and ends as a model of clarity, stating that “all persons born or naturalized in the United States” are “citizens of the United States and of the state wherein they reside.” But between those two phrases, Congress inserted the words “and subject to the jurisdiction thereof.” Those six words have perplexed scholars for 150 years. The dominant view of law professors is the line as a whole guarantees that anyone born within the United States becomes an American citizen. But some believe that the caveat means you must be here in a legal status, that if you are not a American citizen, then you are a legal resident.

I do not believe that there is a credible question of Harris’ eligibility. However, I am concerned with the attacks on Newsweek and the author from a free speech standpoint. This issue has been raised for decades and the Supreme Court cases are few and are not dispositive on all aspects of the question. In prior coverage of candidates like McCain, there was not a demand for newspapers to denounce their own publications. Eastman is a professor who raised a commonly discussed constitutional and political issue. There is no reason to denounce him as a racist or Newsweek as an enabler of racism. Media often publish controversial theories.

There were not demands for retractions when a Harvard professor said Trump was not actually impeached when he was impeached, a North Carolina professor saying the entire Trump defense team would face bar charges, or any number of the controversial theories of criminality against Trump. Instead we simply debated the issues, which actually raised interesting historical or ethical questions. LA Times’ Michael McGough called Newsweek’s explanation “feeble” when it insisted that it was merely sharing a constitutional viewpoint and not attempting “to ignite a racist conspiracy theory around Kamala Harris’ candidacy.” Yet, this “feeble” reason has been the basis for past articles on the debate over the 14th Amendment in major publications for decades.

Read more …

Briefing for a descent into complete chaos post-Nov 4.

UPS, FedEx Reject Calls To Handle Mail-In Ballots: Significant Problems (Hill)

As concern mounts that the United States Postal Service (USPS) will not be able to handle an influx of mail-in ballots during the coronavirus pandemic, many on social media have called for delivery services FedEx and UPS to step up, which the companies have dismissed. In an exclusive interview with Reuters, UPS and FedEx said they legally can’t do the work and warned there would likely be “significant” delays. “State ballots must be postmarked to be considered valid and only the USPS has lawful postmarking status. Therefore UPS, FedEx and other private parties cannot technically be involved in shipping ballots,” UPS told Reuters in a statement.


Meanwhile, FedEx says it does accept individual ballots, but encouraged customers using FedEx to “closely review their state’s guidelines on absentee voting and deadlines for ballots or related election documents.” According to Reuters, various laws prevent private delivery companies from handling mail-in and absentee ballots, and in some states it would be considered ballot harvesting. On top of legal issues, the USPS is equipped to deliver to every mailbox in the U.S. daily, while private delivery companies only deliver when someone has a package or a pickup, and don’t have blanket coverage of more hard-to-reach places, such as rural communities. Many delivery companies are also already struggling with a surge of deliveries brought on by people staying at home during the pandemic and increasingly relying on online shopping.

Read more …

How can you open Target to huge crowds but keep churches closed? What is the reasoning?

California Judge Sides With Church, Allows Indoor Services (WT)

A California court rejected Friday efforts by Los Angeles County to require a popular megachurch to comply with pandemic orders, allowing the church to hold indoor services with singing and without attendance limits pending a resolution of the case. Superior Court Judge James Chalfant denied the county’s request for a temporary restraining order against Grace Community Church after the church began holding indoor services July 26 in defiance of state and county rules aimed at combating the novel coronavirus, according to a press release from the Thomas More Society.


Attorney Jenna Ellis called it a “historic win,” tweeting that the court was the first in California “to recognize #churchisessential.” The Thomas More Society, which represented the church, said the judge ruled “it is the County’s burden to show why it should be permitted to infringe on the constitutionally protected rights of churches to freely exercise religion, but also expressing safety concerns.” At the same time, the church agreed to comply with mask-wearing and social-distancing rules before the full hearing scheduled for Sept. 4.

Read more …

Is he still getting the $600 checks?

Warren Buffett Sheds Big Stakes In Banks And Goes For The Gold (Fox)

Warren Buffett’s Berkshire Hathaway Inc. unloaded a more than a quarter of its stake in Wells Fargo & Co. and about 61% of its position in JPMorgan Chase, while acquiring a new position in Barrick Gold Corp., according to 13-F filings with the Securities and Exchange Commission for the period ended Jun 30, that were released Friday afternoon. Berkshire sold 85.6 million shares of Wells Fargo, representing about 26% of its stake and putting its ownership to about 3% from 5.3%. The insurance conglomerate also shed 35.5 million shares of JPMorgan, 61% of its position, which now represents 1% of Berkshire’s overall portfolio from 3% in the prior period.


Meanwhile, the investment firm acquired nearly 21 million shares of Barrick Gold worth $563 million, representing 0.3% of Berkshire’s holding. Berkshire also reduced its holding in PNC Financial Services (PNC), selling 3.85 million shares to cut its position to 0.3% from 0.5%. Berkshire didn’t change its holdings in Apple Inc. where the firm owns 245 million shares. Large investors must disclose long stock positions held at the end of a quarter 45 days later in a 13-F filing with the SEC, which means such filings are merely a snapshot of an investor’s holdings at a given point.

Read more …

Opening doors for Assange?

Trump: ‘A Lot Of People’ Think Edward Snowden ‘Not Being Treated Fairly’ (NYP)

President Trump polled his aides on Thursday about whether he should let anti-surveillance whistleblower and leaker Edward Snowden return to the US from Russia without going to prison, saying he was open to it. “There are a lot of people that think that he is not being treated fairly. I mean, I hear that,” Trump told The Post in an exclusive interview in the Oval Office, before soliciting views from his staff. Trump commented on Snowden for the first time as president after accusing former President Barack Obama of spying on his 2016 campaign. “When you look at [former FBI Director James] Comey and [former FBI Deputy Director Andrew] McCabe, and [former CIA Director John] Brennan — and, excuse me, the man that sat at this desk, President Obama, got caught spying on my campaign with Biden. Biden and Obama, and they got caught spying on the campaign,” Trump said.


Trump’s comments reflect a remarkable softening in his views about the man he once deemed a “traitor” worthy of execution. Republican lawmakers and the Justice Department’s inspector general recently highlighted misuse of the Foreign Intelligence Surveillance Act and the secret FISA court to surveil former Trump adviser Carter Page. “Snowden is one of the people they talk about. They talk about numerous people, but he is certainly one of the people that they do talk about,” Trump said on Thursday, before turning to his aides. “I guess the DOJ is looking to extradite him right now? … It’s certainly something I could look at. Many people are on his side, I will say that. I don’t know him, never met him. But many people are on his side.”

Read more …

How does one define “lawful” in the UK these days? Who would do the defining?

Chaos In Assange Case Management Hearing (DEAssange)

Attorney General William Barr issued a replacement extradition request just two days after Julian Assange’s defence team submitted their full and final evidence for the extradition hearing due in September, Westminster Magistrates court heard today (Friday 14th August). The clear attempt to blindside the defence by US Attorney General William Barr emerged as the court heard Julian Assange has not even seen the warmed-over extradition request, which contains no new charges but introduces new narrative content that the defence argued should be excluded from the proceedings. The defence argued the replacement indictment introduced alleged conduct from 2010 and 2011 which the US had investigated almost a decade ago, and could therefore not plausibly be argued to be new information to the US investigation.

The defence considered the move by the prosecution to bring in the replacement extradition request at the eleventh hour “astonishing”, given the case had been prepared over the course of one year and was well into substantive hearings which began in February. The defence was given a week to decide whether to ask for the September hearing to be adjourned, or to proceed as planned on 7 September. And that was only part of the chaotic hearing in which Belmarsh prison did not initially bring Assange to the video room to join proceedings, the US prosecution failed to turn up (having got the time of the hearing wrong), and every journalist and NGO observer that tried to dial-in was directed to another trial entirely and never made it into the Assange hearing.

That left a mere of handful of journalists that could gain access to the court to report proceedings. ‘This was the worst hearing so far’, said Kristinn Hrafnsson, WikiLeaks’ Editor-in-chief . ‘The US government seem to want to change the indictment every time the court meet, but without the defence or Julian himself seeing the relevant documents’. Even now Julian Assange has not been re-arrested under the replacement extradition request. Instead the re-arrest will take place on the first day of the hearings. The reissued request appears to serve a PR purpose since it contains no new charges though still threatens Assange with 175 years in jail.

Julian Assange’s legal team have been denied in-person access to their client since March. Today was the first day Julian Assange was able to have a short video link meeting with his lawyers, prior to the hearing. Belmarsh prison denied Assange any facilities to talk to his lawyers after the hearing ended. Julian Assange has not seen his family and young children since March.

Read more …

 

 

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Dec 152019
 


Theodor Horydczak U.S. Supreme Court interiors, Washington DC 1931

 

 

China Suspends Planned Tariffs Scheduled For Dec. 15 On Some US Goods (R.)
Unpacking The No Deal Not a Trade War Trade War Deal (Balding)
Giant China SEO Announces Largest Dollar Bond Default In Two Decades (ZH)
IG Report Reveals Scandal of Historic Magnitude for the FBI and US Media (GG)
The Bloated Pentagon Budget Should Be Spent on Human Needs (Nation)
The Art of Doublespeak: Bellingcat and Mind Control (Curtin)
WikiLeaks: 20 OPCW Inspectors Dissent From Syria Chemical Attack Narrative (ZH)
Hunter Biden Drugs Charge Kept Under Wraps As Joe Led Drug War From Senate (WE)
One-Third Of Credit Card Debt Is Caused By Medical Expenses (CNBC)
Edward Snowden Speaks Out for Julian Assange and Chelsea Manning (RPI)
Assange Lawyer Discloses Conditions For British Justice TO RETHINK His Extradition (RT)
A Million Times More Microplastic In The Oceans Than We Thought (Wef)

 

 

There is one issue underlying all the talks at this point: China is running out of dollars.

China Suspends Planned Tariffs Scheduled For Dec. 15 On Some US Goods (R.)

China has suspended additional tariffs on some U.S. goods that were meant to be implemented on Dec. 15, the State Council’s customs tariff commission said on Sunday, after the world’s two largest economies agreed a “phase one” trade deal on Friday. The deal, rumors and leaks over which have gyrated world markets for months, reduces some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods. China’s retaliatory tariffs, which were due to take effect on Dec. 15, were meant to target goods ranging from corn and wheat to U.S. made vehicles and auto parts.


Other Chinese tariffs that had already been implemented on U.S. goods would be left in place, the commission said in a statement issued on the websites of government departments including China’s finance ministry. “China hopes, on the basis of equality and mutual respect, to work with the United States, to properly resolve each other’s core concerns and promote the stable development of U.S.-China economic and trade relations,” it added. Beijing has agreed to import at least $200 billion in additional U.S. goods and services over the next two years on top of the amount it purchased in 2017, the top U.S. trade negotiator said Friday.

Read more …

Christopher Balding taught in China for a long time; he knows the country. This is his lenghty analysis of the trade deal.

Unpacking The No Deal Not a Trade War Trade War Deal (Balding)

Having been subjected to such a barrage of horrendous trade war analysis that seems more like literary therapy for the politically frustrated than actual deal analysis, I have opted to write my own analysis of the deal. I will as studiously as possible try to avoid or limit any political opinionating, and stick strictly to the analyzing the deal points within the USTR Fact Sheet and providing what are the likely trade offs, risks, and perspective about each points. Let’s get started.

This deal is about a lot more than agriculture.I’m leading with this one only because it is arguably the most common myth and repeated like the 10 Ten Commandments and divine truth even though it is clearly false on numerous levels. The USTR specifically lists IP protection, tech transfer, agriculture, financial services, currency, expanding trade, and dispute resolution as the major areas. One report in the news quoted a source as saying there were 9 chapters which would come close to matching these general areas. Even within the broader trade purchase aspect, agriculture is not even the main area. Let us please kill once and for all, this deal is just about agriculture.

Intellectual Property and Technology Transfer The two paragraphs on IP and tech transfer in the USTR statement provide scant detail but use relatively ambitious language with regards to Chinese commitments. In IP, China will “address long standing concerns”. In tech transfer, the language is even more ambitious saying China “agreed to end its long-standing practice of forcing or pressuring foreign companies to transfer their technology to Chinese companies as a condition for obtaining market access, administrative approvals, or receiving advantages from the government” and “commits to provide transparency, fairness, and due process in administrative proceedings and to have technology transfer and licensing take place on market terms” and “commits to refrain from directing or supporting outbound investments aimed at acquiring foreign technology pursuant to industrial plans that create distortion.”

Read more …

Borrowed in dollars, can’t pay back in dollars.

Giant China SEO Announces Largest Dollar Bond Default In Two Decades (ZH)

Two weeks ago we previewed what we said would soon be a D-Day for China’s bond market, as a massive commodities trader and Global 500 state-owned enterprise was set for an “unprecedented” bond default. As of last week, this historic default is now in the history books after Tewoo, the closely watched Chinese commodities trader, became the biggest dollar bond defaulter among the nation’s state-owned companies in two decades, in what Bloomberg called a “moment of reckoning” for Beijing as China struggles to contain credit risk in a weakening economy, as bond defaults hit an all time high and are set to keep rising in the coming years.

Last Wednesday, Tewoo Group announced results of its “unprecedented” debt restructuring, which saw a majority of its investors accepting heavy losses, and which according to rating agencies qualifies as an event of default. As a result of the default, until recently seen as virtually impossible for a state-owned company, investors’ perceptions are undergoing a dramatic U-turn about government-owned borrowers whose state-ownership had for years offered an ironclad sense of security. No more: The fact that a state-owned enterprise such as Tewoo has now defaulted on repaying its dollar bonds in full, confirms that Beijing will no longer bail out troubled SOEs, let alone private firms, perhaps due to the strains imposed by the economy which while growing at just below 6%, is slowing the most in three decades.

It also raises concerns over the Chinese province of Tianjin, where Tewoo is based, following a series of rating downgrades and financing difficulties suffered by some of the city’s state-run firms. The metropolis near Beijing also has the highest ratio of local government financing vehicle bonds to GDP in China. As a reminder, Tewoo ranked 132 in 2018’s Fortune Global 500 list, higher than many other conglomerates including service carrier China Telecommunications Corp. and financial titan Citic Group Corp. It had an annual revenue of $66.6 billion, profits of about $122 million, assets worth $38.3 billion, and more than 17,000 employees as of 2017, according to Fortune’s website.

Read more …

Glenn Greenwald has dug deep.

IG Report Reveals Scandal of Historic Magnitude for the FBI and US Media (GG)

Just as was true when the Mueller investigation closed without a single American being charged with criminally conspiring with Russia over the 2016 election, Wednesday’s issuance of the long-waited report from the Department of Justice’s Inspector General reveals that years of major claims and narratives from the U.S. media were utter frauds. Before evaluating the media component of this scandal, the FBI’s gross abuse of its power – its serial deceit – is so grave and manifest that it requires little effort to demonstrate it. In sum, the IG Report documents multiple instances in which the FBI – in order to convince a FISA court to allow it spy on former Trump campaign operative Carter Page during the 2016 election – manipulated documents, concealed crucial exonerating evidence, and touted what it knew were unreliable if not outright false claims.

If you don’t consider FBI lying, concealment of evidence, and manipulation of documents in order to spy on a U.S. citizen in the middle of a presidential campaign to be a major scandal, what is? [..] They are out-of-control, virtually unlimited police state factions that lie, abuse their spying and law enforcement powers, and subvert democracy and civic and political freedoms as a matter of course. In this case, no rational person should allow standard partisan bickering to distort or hide this severe FBI corruption. The IG Report leaves no doubt about it.

[..] It’s long been the case that CIA, FBI and NSA operatives tried to infiltrate and shape domestic news, but they at least had the decency to do it clandestinely. In 2008, the New York Times’ David Barstow won the Pulitzer Prize for exposing a secret Pentagon program in which retired Generals and other security state agents would get hired as commentators and analysts and then – unbeknownst to their networks – coordinate their messaging to ensure that domestic news was being shaped by the propaganda of the military and intelligence communities.

But now it’s all out in the open. It’s virtually impossible to turn on MSNBC or CNN without being bombarded with former Generals, CIA operatives, FBI agents and NSA officials who now work for those networks as commentators and, increasingly, as reporters. [..] The past three years of “Russiagate” reporting – for which U.S. journalists have lavished themselves with Pulitzers and other prizes despite a multitude of embarrassing and dangerous errors about the Grave Russian Threat – has relied almost exclusively on anonymous, uncorroborated claims from Deep State operatives (and yes, that’s a term that fully applies to the U.S.). The few exceptions are when these networks feature former high-level security state operatives on camera to spread their false propaganda,

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Tulsi to the rescue.

The Bloated Pentagon Budget Should Be Spent on Human Needs (Nation)

Even as our nation fails to allocate adequate resources to feed the hungry, house the homeless, care for the sick and protect our planet, the coffers of war profiteers continue to grow. This is why we joined with 102 faith leaders and groups to call upon those who are vying to become our next president to embrace significant reallocations away from the bloated Pentagon budget toward major reinvestments in the needs of our communities. The Pentagon is on track to receive $738 billion next year, despite its inability to account for the money it already has. This includes taxpayer dollars that are redirected to corporate war profiteers, such as a staggering $34 billion contract announced in October for Lockheed Martin’s costly and fault-plagued F-35 fighter jet.

Congress has increased the Pentagon’s budget by $20 billion compared to last year. To put this in perspective, that’s double the amount of the Environmental Protection Agency’s entire budget and one-third of all the money spent on international diplomacy and development. It’s a stark and appalling contrast to the lived reality in our communities. As just a few examples, there are 140 million poor and low-income people living in the United States; about 40 million people in this country face food insecurity; salaries for our nation’s teachers plummeted by more than 4.5 percent over the last decade; we are losing veterans to suicide and drug overdose at alarming rates; and our national infrastructure is crumbling beneath our feet.

Why, then, would our elected officials agree to pump more money into weapon systems that don’t work, endless wars that don’t make us safe, and a refurbishment of our nuclear weapons arsenal that, if employed, can only end in apocalyptic destruction? It’s not just bad policy. We find it immoral. President Eisenhower said more than half a century ago: “Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children.”

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Note: Bellingcat is a crucial provider of “evidence” in the MH17 trial that starts in February. It has no credibility left.

The Art of Doublespeak: Bellingcat and Mind Control (Curtin)

In the 1920s, the influential American intellectual Walter Lippman argued that the average person was incapable of seeing or understanding the world clearly and needed to be guided by experts behind the social curtain. In a number of books he laid out the theoretical foundations for the practical work of Edward Bernays, who developed “public relations” (aka propaganda) to carry out this task for the ruling elites. Bernays had honed his skills while working as a propagandist for the United States during World War I, and after the war he set himself up as a public relations counselor in New York City. There is a fascinating exchange at the beginning of Adam Curtis’s documentary, The Century of Self (above), where Bernays, then nearly 100 years old but still very sharp, reveals his manipulative mindset and that of so many of those who have followed in his wake.

He says the reason he couldn’t call his new business “propaganda” was because the Germans had given propaganda a “bad name,” and so he came up with the euphemism “public relations.” He then adds that “if you could use it [i.e. propaganda] for war, you certainly could use it for peace.” Of course, he never used PR for peace but just to manipulate public opinion (he helped engineer the CIA coup against the democratically elected Arbenz government in Guatemala in 1954 with fake news broadcasts). He says “the Germans gave propaganda a bad name,” not Bernays and the United States with their vast campaign of lies, mainly aimed at the American people to get their support for going to a war they opposed (think weapons of mass destruction).

He sounds proud of his war propaganda work that resounded to his credit since it led to support for the “war to end all wars” and subsequently to a hit movie about WWI, Yankee Doodle Dandy, made in 1942 to promote another war, since the first one somehow didn’t achieve its lofty goal. As Bernays has said, “The American motion picture is the greatest unconscious carrier of propaganda in the world today.”

 

[..] There is a notorious propaganda outfit called Bellingcat, started by an unemployed Englishman named Eliot Higgins, that is funded by The Atlantic Council (a think-tank with deep ties to the U.S. government, NATO, war manufacturers, and their allies), and the National Endowment for Democracy (NED) (another infamous U.S. front organization heavily involved in so-called color revolution regime change operations all around the world), that has just won the International Emmy Award for best documentary. The film with the Orwellian title, Bellingcat: Truth in a Post-Truth World, received its Emmy at a recent ceremony in New York City.

Bellingcat is an alleged group of amateur on-line researchers who have spent years shilling for the U.S. instigated war against the Syrian government, blaming the Douma chemical attack and others on the Assad government, and for the anti-Russian propaganda connected to, among other things, the Skripal poisoning case in England, and the downing of flight MH17 plane in Ukraine. It has been lauded by the corporate mainstream media in the west. Its support for the equally fraudulent White Helmets (also funded by the US and the UK) in Syria has also been praised by the western corporate media while being dissected as propaganda by many excellent independent journalists such as Eva Bartlett, Vanessa Beeley, Catte Black, among others.

It’s had its work skewered by the likes of Seymour Hersh and MIT professor Theodore Postol, and its US government connections pointed out by many others, including Ben Norton and Max Blumenthal at The Gray Zone. And now we have the mainstream media’s wall of silence on the leaks from the OPCW concerning the Douma chemical attack and the doctoring of their report that led to the illegal US bombing of Syria in the spring of 2018. Bellingcat was at the forefront of providing justification for such bombing, and now the journalists Peter Hitchens, Tareq Harrad (who recently resigned from Newsweek after accusing the publication of suppressing his revelations about the OPCW scandal) and others are fighting an uphill battle to get the truth out.

Yet Bellingcat: Truth in a Post-Truth World won the Emmy, fulfilling Bernays’ point about films being the greatest unconscious carriers of propaganda in the world today. Who presented the Emmy Award to the filmmakers, but none other than the rebel journalist Chris Hedges.

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Dismantling the OPCW is the only possible way forward.

WikiLeaks: 20 OPCW Inspectors Dissent From Syria Chemical Attack Narrative (ZH)

Late Saturday WikiLeaks released more documents which contradict the US narrative on Assad’s use of chemical weapons, specifically related to the April 7, 2018 Douma incident, which resulted in a major US and allied tomahawk missile and air strike campaign on dozens of targets in Damascus.

The leaked documents, including internal emails of the Organization for the Prohibition of Chemical Weapons (OPCW) — which investigated the Douma site — reveal mass dissent within the UN-authorized chemical weapons watchdog organization’s ranks over conclusions previously reached by the international body which pointed to Syrian government culpability. It’s part of a growing avalanche of dissent memos and documents casting the West’s push for war in Syria in doubt (which had resulted in two major US and allied attacks on Syria). This newly released batch, WikiLeaks reports, includes a memo stating 20 inspectors feel that the officially released version of the OPCW’s report on Douma “did not reflect the views of the team members that deployed to [Syria]”.

This comes amid widespread allegations US officials brought immense pressure to bear on the organization. The Daily Mail’s Peter Hitchens, who saw the leaked documents just prior to WikiLeaks going public with them had this to say: Sources stress that the scientists involved are ‘non-political, utterly uninterested in any strategic implications of what they reveal’. They just ‘feel that the OPCW has a duty to be true to its own science, and not to be influenced by political considerations as they fear it has been’. An internal memo seen by The Mail on Sunday suggests that as many 20 OPCW staff have expressed private doubts about the suppression of information or the manipulation of evidence.

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This is about 1988. 25 years later, in 2013, Hunter was discharged from the U.S. Navy after testing positive for cocaine. One year after, he landed his job with Burisma. Two years after that, a 2016 police report said that Hunter Biden returned a rental car in Arizona that contained a cocaine pipe and “a small ziplock bag with a white powdery substance inside all sitting on the passenger seat.”

Hunter Biden Drugs Charge Kept Under Wraps As Joe Led Drug War From Senate (WE)

Joe Biden’s son Hunter was arrested on Jersey Shore drug charges in 1988 and had his record expunged at a time when his father was pushing for the incarceration of drug offenders drawn disproportionately from minority groups. Congressional records reveal that Hunter Biden, now 49, was arrested in Stone Harbor, New Jersey, where the Biden family has often holidayed over the years, in June 1988. Hunter Biden, then 18, had just graduated from the prestigious Archmere Academy prep school, which his father had also attended. The former vice president and his wife Jill have often been spotted on trips to Stone Harbor.

The arrest has not previously been reported. Republicans have recently highlighted Hunter Biden’s drug abuse, questioning why it was not taken into account when the lobbyist was appointed to a $50,000-a-month post on the board of the Ukraine oil company Burisma in 2014, when his father, as vice president, was the Obama administration’s lead official on Ukraine. A year after the arrest, Joe Biden gave a speech in which he said the federal government needed to “hold every drug user accountable” because, “If there were no drug users, there would be no appetite for drugs, there would be no market for them.” He neglected to mention the drug use in his own family.

[..] Five months after his son escaped a sentence and had his possession charge kept secret, Biden voted for the Anti-Drug Abuse Act of 1988, which made crack cocaine, often used by poor, black offenders, the only drug with a mandatory minimum penalty for a first offense of simple possession. But while many minorities were imprisoned for minor drug offenses, the wealthy, white Hunter Biden was allowed to participate in a state diversionary program called pretrial intervention. The program allowed first offenders to “avoid a trial and having the stigma accompanying a guilty verdict,” according to the Rubinstein Law Firm in New Jersey.

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Advice on how to deal with it, not a statement about how ridiculous this is.

One-Third Of Credit Card Debt Is Caused By Medical Expenses (CNBC)

For millions of Americans, unexpected bills can be summed up in two words: medical debt. Surprise health-care costs have affected about 137.1 million adults in the past year, according to recent research. And many Americans are turning to credit cards to help manage those debt burdens, according to CompareCards.com. The website found that 33% of cardholders are in debt because of medical bills. And nearly 60% said they used a card because they had no other way to pay. If you’re saddled with this debt, you need to take action.


First, start by making sure that you’re getting the best interest rates for your balances. If you have debt sitting on a high-interest card, consider transferring the balance to a 0% credit card. You may also use a medical credit card for out-of-pocket expenses not covered by your insurance. These cards, which are offered by companies like CareCredit, have special financing you may not get on other cards. They’re interest-free for a few months as long as you make your monthly payments on time. After that period, though, be sure to pay the balance off in full to avoid deferred interest that will charged from the original date of purchase.

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Obama revived the Espionage Act. But he didn’t have the guts to use it against journalists.

Edward Snowden Speaks Out for Julian Assange and Chelsea Manning (RPI)

Last week, Edward Snowden, a whistleblower who has since 2013 escaped similar silencing via retaining sanctuary in Russia, spoke up in strong advocacy for Assange and Manning’s freedom. He did so in an interview with Democracy Now host Amy Goodman. Snowden points out in the interview that the US cases against Assange, Manning, and himself all derive from the Espionage Act, the same Espionage Act that he notes was used against Daniel Ellsberg in the 1970s after Ellsberg leaked the Pentagon Papers to media. Pointing as an example to Ellsberg being prevented from even telling a jury at trial why he leaked the Pentagon Papers that revealed the hidden truth about US actions in the Vietnam War, Snowden emphasizes that the Espionage Act “is a special law that absolutely rules out any kind of fair trial.”

Continuing, Snowden discusses in the interview Manning’s revelations of “torture and war crimes, indefinite detention on the part of the United States government in places like Iraq and Afghanistan and Guantanamo Bay in Cuba” and Snowden’s own “involvement in the revelation of global mass surveillance” as being part of activities by a “new generation” of whistleblowers. Like Ellsberg, Snowden relates that he and Manning were confronted with the Espionage Act “that forbids the jury to consider” if the leaking activity at issue “was something that did more good for the public to know than it did harm to the government in terms of inconvenience or theoretical risks of investigative journalism in a free society.” And Snowden makes sure to emphasizes that the victims of this type of persecution over the last few years extend beyond Manning and himself.

Indeed, the charging of Julian Assange under the Espionage Act Snowden sees as particularly threatening. States Snowden: “We moved from an individual and exceptional case that was not repeated for decades and decades in the Ellsberg instance to something that under the Obama administration he charged more sources of journalism using this special law than all other presidents in the history of the United States combined. And now, under the Trump administration, we have taken one more step. We have gone from the United States government’s war on whistleblowers to, now, a war on journalism with the indictment of Julian Assange for what even the government itself admits was work related to journalism. And this I think is a dangerous, dangerous thing — not just for us, not just for Julian Assange, but for the world and the future.”

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“December 20 is an important day..”

Assange Lawyer Discloses Conditions For British Justice TO RETHINK His Extradition (RT)

A Spanish judge will question Julian Assange on a Spain-based security firm thought to have spied on him in the Ecuadorian Embassy in London. His lawyer hopes it may help thwart the WikiLeaks founder’s extradition to the US. Set for next week, the questioning is part of a criminal inquiry the Spanish High Court is carrying out into UC Global, a private security company suspected of gathering surveillance on Assange and passing it further to US intelligence services. “December 20 is an important day,” Aitor Martinez, a lawyer in charge of defending Assange in Spain, told Russia’s RIA Novosti news agency. The Spanish judge will go to Westminster Magistrates Court “to receive a video conference testimony from Mr Assange as a victim of the alleged spy plot,” he revealed.

The firm’s name surfaced this summer when El Pais newspaper reported that it was eavesdropping on Assange during his exile at the Ecuadorian diplomatic mission in London. Citing recordings it has had access to, the paper alleged that the firm – tasked to guard the embassy – specifically focused on Assange’s legal matters discussions. Now, Assange’s input is invaluable as it can pave the way to shooting down US efforts to try the publisher on their soil, Martinez explained. “Obviously, once Spanish justice receives such testimonies from Mr. Assange … the British justice should rethink the usefulness of his extradition [to the US],” he argued. As the inquiry progressed, the Spanish High Court arrested the company’s owner David Morales, a former member of the Spanish military, believed to have liaised with the US side.

He was released on bail, but his company’s premises were searched and his bank accounts frozen. As the story unfolded, it emerged that UC Global operatives also monitored Russian and American visitors to Assange, handing their profiles to US intelligence. Morales himself didn’t try to hide his ties to the “American friends.” According to Germany’s NDR broadcaster, which filed a complaint against UC Global for having targeted one of its journalists who visited Assange, Morales allegedly told one of his employees: “From now on, we play in the first league… We are now working for the dark side.” He is said to have traveled up to twice a month to the US to deliver intelligence taken from the Ecuadorian Embassy.

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And in our own bodies too, if not now then soon.

A Million Times More Microplastic In The Oceans Than We Thought (Wef)

There could be a million times more microplastics floating around our oceans than previously thought, according to new research suggesting existing studies could have seriously underestimated the problem. Some microplastics – defined as fragments measuring less than 5 mm – are too small to be caught in the nets traditionally used to collect samples, making them go unnoticed. But researchers say a new technique has enabled more accurate measurements, capturing pieces smaller than the width of a human hair. The study, led by biological oceanographer Jennifer Brandon of Scripps Institution of Oceanography, published in the science journal Limnology and Oceanography Letters, found the concentration of tiny plastic pieces could be five to seven orders of magnitude greater than previously thought.

These fragments make their way into the world’s waterways and end up in our oceans. More than one-third of microplastics in the ocean come from synthetic fabrics, such as polyester or nylon. Car tyres are the second-leading source, releasing plastic particles as they erode. To more accurately record the level of microplastic pollution in ocean waters, the researchers analysed seawater salps, which are tiny, barrel-shaped filter feeders. These invertebrates inhabit ocean waters to depths of around 2 kilometres. Salps pump salt water through their bodies as they perform a pulsing movement both to feed and to move through the ocean. Filter-feeding in the ocean depths makes them a likely place to find microplastics, the researchers say.

All of the salp samples taken from three different ocean zones had mini-microplastic particles in their stomachs. Since food passes through the creature’s digestive system in two to seven hours, it was an alarming find. “The thing that truly surprised me the most was that every salp, regardless of year collected, species, life stage, or part of the ocean collected, had plastic in its stomach,” Brandon explained to Earther. “A species having 100% ingestion rates is quite extraordinary, and devastating for the food web that eats salps.”

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Sep 292019
 
 September 29, 2019  Posted by at 9:56 am Finance Tagged with: , , , , , , , , ,  23 Responses »


Paul Gauguin Portrait of Ingeborg Thaulow 1877

 

Pelosi Says Public Opinion Shifting In Support Of Impeachment Inquiry (R.)
Pelosi’s House Rule Changes are Key Part of “Articles of Impeachment” (CTH)
Scott Adams Makes the Case for ‘President for Life’ Trump (Ricochet)
The Problem With Impeachment (Chris Hedges)
On The Motives Behind Whistleblower-gate (MoA)
The Latest Plot To Topple Trump: Politics According To -Groucho- Marx (SCF)
State Dept. Ramps Up Probe Into Clinton Email Server (Hill)
Has Australia Really Had a 28-Year Expansion? (St.Louis Fed)
U.S. Income Inequality Worsens, Widening To A New Gap (NPR)
Edward Snowden’s Julian Assange is an Unfamiliar Julian Assange (MPN)

 

 

She made that up.

Pelosi Says Public Opinion Shifting In Support Of Impeachment Inquiry (R.)

U.S. House Speaker Nancy Pelosi said on Saturday that public opinion is now on the side of an impeachment inquiry against President Donald Trump following the release of new information about his conversations with Ukrainian President Volodymyr Zelenskiy. Pelosi this week announced her support for an investigation after the surfacing of a whistleblower complaint that said Trump appeared to solicit a political favor from Ukraine’s president aimed at helping him be re-elected next year. Pelosi for months took a cautious approach in weighing the calls of other Democratic House members to launch impeachment proceedings against Trump, which grew louder after former Special Counsel Robert Mueller testified on July 24 about his probe of Trump and Russian interference in the 2016 election.

“In the public, the tide has completely changed; it could change now – who knows – but right now after seeing the complaint and the IG (Inspector General) report and the cavalier attitude the administration had towards it, the American people are coming to a different decision,” Pelosi said at a journalism event hosted by the Texas Tribune news website. She added that her resistance to holding an impeachment inquiry quickly evolved from urging that fellow Democrats remain cautious of the political fallout ahead of next year’s elections to full steam ahead as details emerged of Trump’s dealings with Ukraine’s leader. “A president of the United States would withhold military assistance paid for by taxpayers to shake down the leader of another country unless he did him a political favor – that is so, so clear,” Pelosi said.

[..] Several Democratic presidential candidates attended the three-day event in Austin, including Mayor Pete Buttigieg, former Representative Beto O’Rourke, Senator Amy Klobuchar and former Housing Secretary Julian Castro, all of whom agreed with Pelosi that the campaign to push Trump from office must focus on policies and not impeachment. While some polls have shown Americans are split on supporting impeachment, Castro, who served under former President Barack Obama, said he thinks the public will increasingly back the inquiry. “Like in Watergate, after more evidence gets out there … you’ll see more people of different political stripes start to support it,” Castro said at the event, referring to moves in 1974 to impeach former President Richard Nixon.

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Pelosi called for impeachment without having seen the transcript or the complaint. That will forever be weird.

Pelosi’s House Rule Changes are Key Part of “Articles of Impeachment” (CTH)

Back in December 2018 CTH noted the significant House rule changes constructed by Nancy Pelosi for the 116th congress seemed specifically geared toward impeachment. {Go Deep} With the House going into a scheduled calendar recess, those rules are now being used to subvert historic processes and construct the articles of impeachment. A formal vote to initiate an “impeachment inquiry” is not technically required; however, there has always been a full house vote until now. The reason not to have a House vote is simple: if the formal process was followed the minority (republicans) would have enforceable rights within it. Without a vote to initiate, the articles of impeachment can be drawn up without any participation by the minority; and without any input from the executive. This was always the plan that was visible in Pelosi’s changed House rules.

Keep in mind Speaker Pelosi selected former insider DOJ official Douglas Letter to be the Chief Legal Counsel for the House. That becomes important when we get to the part about the official full house impeachment vote. The Lawfare group and DNC far-left activists were ecstatic at the selection. Doug Letter was a deep political operative within the institution of the DOJ who worked diligently to promote the weaponized political values of former democrat administrations. Speaker Pelosi has authorized the House committees to work together under the umbrella of an “official impeachment inquiry.” The House Intelligence (Schiff) and Judiciary Committees (Nadler) are currently working together leading this process.

From recent events we can see the framework of Schiff compiling Trump-Ukraine articles and Nadler compiling Trump-Russia articles. Trump-Ukraine via Schiff will likely focus on a corruption angle; Trump-Russia via Nadler will likely focus on an obstruction angle. How many articles of impeachment are finally assembled is unknown, but it is possible to see the background construct as described above. Unlike historic examples of committee impeachment assembly, and in combination with the lack of an initiation vote, Pelosi’s earlier House Rule changes now appear intentionally designed to block republicans during the article assembly process. The minority will have no voice. This is quite a design.

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Not really, but his arguments are interesting, and shared by many: how to put the CIA offside.

Scott Adams Makes the Case for ‘President for Life’ Trump (Ricochet)

No, Scott Adams is not suggesting that Trump be president for life. But Scott is making the case for Trump being the last legitimate president. Hence (my conclusion), if we want our president to be legitimate then we should want Trump to be president for life. And given his age that would not be an oppressively long time. So what is Scott talking about?! He referenced the other day a tweet from the person Scott thinks is the “smartest man he has ever met” — Naval Ravikant: Does it bother anyone else that our elected officials live in a panopticon run by our intelligence agencies? A panopticon is like a one-way mirror where a person can see everything without being seen.

In other words, if you assume that our intelligence service has technological access to conversations, emails, texts by accessing both public networks and “things” owned by elected officials that are connected to the internet, then our intelligence apparatus is in an enormously powerful position vis a vis elected officials. That is, bureaucrats have something on officials that can be used as leverage to override the desires and preferences of constituencies. This delegitimizes the elected politician as acting in the constituents’ interest rather than that of the intelligence community. Earlier Senator Schumer said much the same thing: “Let me tell you: You take on the intelligence community — they have six ways from Sunday at getting back at you.”

Now, according to Scott, Trump is the only elected politician who can resist the threats of the intelligence agencies because his flaws are well-known and flagrant, thus he has the least risk of losing political power from anything the intelligence officials could leak and would be believed. (At this point most voters don’t think or will ever be made to think that Trump is a traitor, intentionally working against the interests of the United States. Nor do they think that he is engaged in any “abuse of power” that is over the line for a president.) This makes him more legitimate as a political leader — from a constituency standpoint — than anyone who could be elected. So why wouldn’t you want Trump to be president for life?

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Chris Hedges has the same reasoning as Scott Adams.

The Problem With Impeachment (Chris Hedges)

Impeaching Donald Trump would do nothing to halt the deep decay that has beset the American republic. It would not magically restore democratic institutions. It would not return us to the rule of law. It would not curb the predatory appetites of the big banks, the war industry and corporations. It would not get corporate money out of politics or end our system of legalized bribery. It would not halt the wholesale surveillance and monitoring of the public by the security services. It would not end the reigns of terror practiced by paramilitary police in impoverished neighborhoods or the mass incarceration of 2.3 million citizens. It would not impede ICE from hunting down the undocumented and ripping children from their arms to pen them in cages. It would not halt the extraction of fossil fuels and the looming ecocide. It would not give us a press freed from the corporate mandate to turn news into burlesque for profit. It would not end our endless and futile wars. It would not ameliorate the hatred between the nation’s warring tribes—indeed would only exacerbate these hatreds.


Impeachment is about cosmetics. It is about replacing the public face of empire with a political mandarin such as Joe Biden, himself steeped in corruption and obsequious service to the rich and corporate power, who will carry out the same suicidal policies with appropriate regal decorum. The ruling elites have had enough of Trump’s vulgarity, stupidity and staggering ineptitude. They turned on him not over an egregious impeachable offense—there have been numerous impeachable offenses including the use of the presidency for personal enrichment, inciting violence and racism, passing on classified intelligence to foreign officials, obstruction of justice and a pathological inability to tell the truth—but because he made the fatal mistake of trying to take down a fellow member of the ruling elite.

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Decent overview of what’s going on.

On The Motives Behind Whistleblower-gate (MoA)

The whistleblower statute says that the matter in question must be an “urgent concern” that is defined as: “… a serious or flagrant problem, abuse, violation of law or Executive order, or deficiency relating to the funding, administration, or operations of an intelligence activity involving classified information, but does not include differences of opinions concerning public policy matters”. At the core of the complaint in question is a claim that Trump used a phone call with President Volodymyr Zelensky of the Ukraine to press Zelensky to investigate two issues. The call memorandum was declassified and published. During the phone call Zelensky had two requests. He wanted U.S. anti-tank weapons and he wanted an invitation to the White House. (He got both.)

Trump also had a request. He asked that Ukrainian authorities investigate two issues of U.S. public interest. The first is the reported interferences by Ukrainian government officials in favor of Hillary Clinton during the 2016 election campaign. This also involved the notorious security company CrowdStrike which made some false claims about Russian hacking in the Ukraine. The second one is the also well-know intervention by then Vice-President Joe Biden against a Ukrainian Attorney General who had an open investigation against a company that was sponsoring his son Hunter Biden. The U.S. and the Ukraine have a treaty that requires them to cooperate on law enforcement matters. That Trump wanted the Ukrainian authorities to investigated these issues was well known.

His personal lawyer Rudi Giuliani had said for several months that he was looking into these questions. The issues pointed out in the complaint are clearly beyond the scope of the whistleblower statute. Trump’s actions with regard to the Ukraine, especially the phone call, were neither outside of any law nor do they involve any intelligence activity. What Trump did during the call was not nefarious. The issue is clearly a question of “differences in opinion concerning public policy matters”. A whistleblower complaint must be send to the relevant agency’s inspector general. If he finds it credible it goes to the head of the agency who decides if it is within the statute and, if it is, sends the complaint to Congress.

The agency’s inspector general Michael Atkinson found the complaint ‘credible’ but, after seeking legal advice, the acting director of national intelligence Joseph Maguire did not forward it to Congress. It was the right thing to do as the content of the complaint is neither ‘whistleblowing’ nor within the relevant statute. What happened next is curious: “The agency’s inspector general, Michael Atkinson, notified Congress that the complaint existed but says he and Maguire have reached an “impasse” over whether to turn it over.” I have found no legal analysis if this was a required move or outside of the usual process. After that step was taken details of the complaint leaked to the press as they were supposed to do.

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I increasingly suspect Hillary will emerge.

The Latest Plot To Topple Trump: Politics According To -Groucho- Marx (SCF)

Right after being falsely accused of conspiring with Russia for the past two and a half years, Trump is suddenly accused of the opposite – of conspiring with Ukraine instead! This Reversal of Fortune – and of accusations – demands that the American public be as stupid and brainwashed as the oppressed population of Oceania in George Orwell’s dark and prophetic classic dystopia “1984.” “We are at War with Eurasia! We have always been at War with Eurasia!” “No! We LOVE Eurasia! We are at War with EASTAsia! We have always been at war with Eastasia!” Clearly, the readers and viewers of the New York Times, the Washington Post, MSNBC, CNN and all the rest of America’s media “Powers That Be” have already been well trained in Orwellian Doublethink and witless stupidity.

Suddenly, President Vladimir Putin of Russia is no longer the Evil Bad Guy plotting with Trump. Now it is new President of Ukraine Volodymyr Zelenskyy, himself a former professional comic actor on television. The Marx Brothers would have loved to co-star with him. Perhaps after being forced out of the presidency Trump, himself a former hit TV star across America, could hire Zelenskyy as his sidekick in a revival of his famous reality television show “The Apprentice.” As the late great British satirist Michael Wharton, who wrote under the nom de plume Peter Simple liked to say – the wilder the fantasy, the more rapidly it was bound to ‘collapse” into the realm which we naively and inaccurately describe as “reality.”

And what is the latest terrible crime that the President of the United States is now –suddenly and without warning – accused of? He dared to investigate whether Hunter Biden, the son of another eminent politician, former vice president Joe Biden was guilty of corruption. Just think of the consequences if Trump and his officials were allowed to continue their investigation unhindered: They might – shockingly! – put some other corrupt former US politicians out of business. Obviously, that would be the most terrible threat imaginable to the Home of the Brave and the Land of the Free.

No wonder the US Deep State hates Donald Trump! But there is another goal for this concocted scandal. It’s a twofer – a two for one scandal – intended to topple Trump and remove Biden from serious consideration at the same time, clearing the way for the Deep State’s True Candidate – Senator Elizabeth Warren. The shamelessness of this latest concocted scandal would leave Josef Goebbels green with envy and laughing uncontrollably. Unfortunately, it isn’t a joke.

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Hilarious: “It is such an obscene abuse of power and time involving so many people for so many years,” they said. “This has just sucked up people’s lives for years and years.”

I could have sworn they were talking about the Mueller investigation.

State Dept. Ramps Up Probe Into Clinton Email Server (Hill)

The State Department reportedly intensified a probe into former Secretary of State Hillary Clinton’s private email server, contacting dozens of former aides involved in email exchanges that passed through Clinton’s server. The Washington Post reported Saturday that as many as 130 former Clinton aides have been contacted by State Department investigators in recent weeks, with many being informed that they have been found “culpable” for transmitting information that should have been classified at a higher level than it was originally sent. Former Obama administration officials describe the probe to the Post as an extraordinary investigation fueled by political animosity.

But current officials speaking on the condition of anonymity told the newspaper that the probe was structured to avoid the appearance of political bias. The probe, which reportedly reached the stage where former officials began being contacted shortly after Trump’s inauguration, was described by one senior agency official to the Post as having nothing to do with President Trump’s vows to investigate Clinton if elected during the 2016 election. “This has nothing to do with who is in the White House,” the official said. “This is about the time it took to go through millions of emails, which is about three and a half years.” “The process is set up in a manner to completely avoid any appearance of political bias,” another official told the Post.

Former officials involved in the probe described it as a political vendetta, with one telling the Post it was an “abuse of power” by the Trump administration. “It is such an obscene abuse of power and time involving so many people for so many years,” they said. “This has just sucked up people’s lives for years and years.”

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No.

Has Australia Really Had a 28-Year Expansion? (St.Louis Fed)

In July, the U.S. officially entered its longest expansion on record. Naturally, many are wondering if the expansion is sustainable. When asking this question, many turn to the Australian case, as it has been argued that Australia hasn’t had a recession in 28 years. But is this really the case? The figure below shows the growth rate of Australia’s GDP, with recessions shaded gray. (Recessions are defined here as two or more consecutive quarters of negative GDP growth.)

According to this, Australia has not had a recession since 1991 and has been growing since. However, when we look at real per capita GDP growth, the story changes. The figure below shows Australia’s per capita GDP growth rate. Again, recessions are shaded gray and defined as two or more consecutive quarters of negative growth.

As shown in the figure, Australia has had three recessions since 1991 when looking at GDP per capita, the most recent one being from the second quarter of 2018 to the first quarter of 2019. This discrepancy between the growth rate of per capita GDP and the growth rate of GDP implies that population growth has been a key factor for Australia’s economic expansion. A rising population increases the size of the economy, and therefore total output increases, which is reflected in the level of GDP. However, the fact that we do see economic downturns in per capita terms means that population is growing faster than GDP. For nearly 40 years, Australia has had a higher population growth rate than other industrialized economies, as seen in the figure below.

In particular, it had a surge in population around 2008—during the height of the global financial crisis—due to migration. This population growth translated to overall positive GDP growth, but its effect on GDP growth hasn’t been enough to prevent recessions in per capita terms. Per capita recessions are not unique to Australia. In the table below, we compare the number of observed recessions when using GDP growth versus per capita GDP growth for several OECD countries. Again, a recession is defined as two or more consecutive quarters of negative growth.

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On a societal level (in)equality is strongly linked to prosperity.

U.S. Income Inequality Worsens, Widening To A New Gap (NPR)

The gap between the richest and the poorest U.S. households is now the largest it’s been in the past 50 years — despite the median U.S. income hitting a new record in 2018, according to new data from the U.S. Census Bureau. U.S. income inequality was “significantly higher” in 2018 than in 2017, the federal agency says in its latest American Community Survey report. The last time a change in the metric was deemed statistically significant was when it grew from 2012-2013. While many states didn’t see a change in income inequality last year, the income gap grew wider in nine states: Alabama, Arkansas, California, Kansas, Nebraska, New Hampshire, New Mexico, Texas and Virginia.

The disparity grew despite a surging national economy that has seen low unemployment and more than 10 years of consecutive GDP growth. The most troubling thing about the new report, says William M. Rodgers III, a professor of public policy and chief economist at the Heldrich Center at Rutgers University, is that it “clearly illustrates the inability of the current economic expansion, the longest on record, to lessen inequality.” When asked why the rising economic tide has raised some boats more than others, Rodgers lists several factors, including the decline of organized labor and competition for jobs from abroad. He also cites tax policies that favor businesses and higher-income families.

Income inequality is measured through the Gini index, which measures how far apart incomes are from each other. To do that, the index assigns a hypothetical score of 0.0 to a population in which incomes are distributed perfectly evenly and a score of 1.0 to a population where only one household gets all of the income. In the U.S., the Gini index figure had been holding steady for the past several years. But it moved from 0.482 in 2017 to 0.485 in 2018. While that change may seem small, it’s statistically significant, the Census Bureau says. The agency notes that back in 2006, the figure stood at 0.464.

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I haven’t read the book, but this is a little alarming.

Edward Snowden’s Julian Assange is an Unfamiliar Julian Assange (MPN)

NSA whistleblower Edward Snowden and WikiLeaks’ former editor Julian Assange have a complicated relationship. On the one hand, they share important similarities: both are perceived as dangerous enemies by the United States government, and both have been documentary subjects of filmmaker Laura Poitras. On the other hand, they clearly disagree when it comes to the means of achieving government transparency and accountability. After all, if Snowden had agreed with Assange about publishing practices, it is likely that he would have followed Chelsea Manning’s example and sent the NSA documents he collected and disclosed in 2013 to WikiLeaks.

The recent publication of Permanent Record, Snowden’s 336-page memoir, takes the Snowden-Assange dynamic to new—and problematic—heights. When Assange was forcibly dragged out of the Ecuadorian embassy in early 2019, Snowden was among the leading voices condemning the arrest of the WikiLeaks founder, calling it a dangerous assault on journalism. But in his memoir, Snowden uses rhetorical tricks to present Assange and WikiLeaks as his deceitful and irresponsible foils in a blatant and seemingly self-serving effort to highlight his own trustworthiness and accountability. Indeed, reviewers at the Washington Post and New Yorker have already seized upon Snowden’s anti-Assange rhetoric to serve their own anti-Assange agendas.

Proponents of press freedom have become accustomed to Pentagon and national security state attacks on Assange, but Snowden’s puzzling claims about the white-haired Australian and his transparency organization are exceptionally dangerous because they come from an otherwise highly respectable and trustworthy source, and at a time when there is otherwise a virtual media blackout on WikiLeaks. To be sure, Snowden deserves recognition as a courageous whistleblower and as a global champion of privacy rights, but in Permanent Record, Snowden appears willing to use a political prisoner for personal gain, deliberately distorting the truth and perpetuating the imperialistic propaganda that threatens not only Assange’s health but also his very life—just like the corporate media and national security state he exposed in 2013.

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Trans I Re by Fredrik Raddum

 

 

 

 

 

Sep 212019
 
 September 21, 2019  Posted by at 9:03 am Finance Tagged with: , , , , , , , , , , , ,  9 Responses »


Paul Gauguin The Seine in Paris 1875

 

United States Sending Troops To Bolster Saudi Defenses After Attack (R.)
Trump Says He’s Sanctioning Iran’s National Bank (Hill)
Trump Derides MSM Over Biden-Ukraine Story: You’re Gonna Look Really Bad (ZH)
In Call, Trump Urged Ukraine President 8x To Investigate Biden’s Son (CNBC)
WaPo Reports No “Quid Pro Quo” Offered During Phone Call (ZH)
Missing Piece to the Ukraine Puzzle (Solomon)
Is WeWork a Fraud? (Hawksberry)
‘The Men Who Plundered Europe’: Bankers On Trial For Siphoning €60bn (G.)
Desperate Central Bankers Grab for More Power (Brown)
Hopes For Trade Breakthrough Fade As China Cancels US Farm Visits (R.)
President of the Selfies (Kunstler)
France Rejects Edward Snowden’s Asylum Request, Fears Major Fallout With US (ZH)
Julian Assange: Justice Denied (Sagir)

 

 

This Reuters journalist unexpectedly gets it just right: “The Pentagon’s late Friday announcement appeared to close the door to any imminent decision to wage retaliatory strikes against Iran following the attack..”

United States Sending Troops To Bolster Saudi Defenses After Attack (R.)

U.S. President Donald Trump on Friday approved sending American troops to bolster Saudi Arabia’s air and missile defenses after the largest-ever attack on the kingdom’s oil facilities, which Washington has squarely blamed on Iran. The Pentagon said the deployment would involve a moderate number of troops – not numbering thousands – and would be primarily defensive in nature. It also detailed plans to expedite delivery of military equipment to both Saudi Arabia and the United Arab Emirates. Reuters has previously reported that the Pentagon was considering sending anti-missile batteries, drones and more fighter jets. The United States is also considering keeping an aircraft carrier in the region indefinitely.

“In response to the kingdom’s request, the president has approved the deployment of U.S. forces, which will be defensive in nature and primarily focused on air and missile defense,” U.S. Defense Secretary Mark Esper said at a news briefing. “We will also work to accelerate the delivery of military equipment to the kingdom of Saudi Arabia and the UAE to enhance their ability to defend themselves.” The Pentagon’s late Friday announcement appeared to close the door to any imminent decision to wage retaliatory strikes against Iran following the attack, which rattled global markets and exposed major gaps in Saudi Arabia’s air defenses.

Trump said earlier on Friday that he believed his military restraint so far showed “strength,” as he instead imposed another round of economic sanctions on Tehran. “Because the easiest thing I could do, ‘Okay, go ahead. Knock out 15 different major things in Iran.’ … But I’m not looking to do that if I can,” Trump told reporters at the White House.

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Jim Rickards’s comment on Twitter: “Trump just sanctioned the central bank of Iran (Bank Markazi). If you’re not a banking expert and want to understand the impact, it’s like turning off the oxygen of a patient in intensive care. The result is predictable.”

Trump Says He’s Sanctioning Iran’s National Bank (Hill)

President Trump announced Friday that he had sanctioned Iran’s national bank, calling them the “highest sanctions ever imposed on a country.” Trump made the comments to reporters during an Oval Office meeting with Australian Prime Minister Scott Morrison. The announcement comes two days after Trump said he had instructed the Treasury Department to increase sanctions on Iran following attacks on two oil facilities in Saudi Arabia. The Trump administration has blamed Iran in the attacks, which took out roughly 5 percent of the global oil supply on Saturday. “These are the highest sanctions ever imposed on a country, we’ve never done it to this level. It’s too bad what’s happening with Iran, it’s going to hell,” Trump told reporters, saying Tehran is “practically broke.”


The Treasury Department said in a statement that it was sanctioning Iran’s central bank, Iran’s national development fund and Etemad Tejarate Pars Co., an Iran-based firm that U.S. officials said is used to conceal financial transfers for purchases by Iran’s defense ministry. Treasury Secretary Steven Mnuchin joined Trump briefly in the Oval Office to announce the new sanctions on Friday. “We are continuing the maximum pressure campaign,” Mnuchin said. “This will mean no more funds going to the [Islamic Revolutionary Guards Corps] or to fund terror, and this is on top of our oil sanctions and our financial institution sanctions.” “The easiest thing I can do, OK go ahead, knock down 15 major things in Iran,” Trump told reporters in the Oval Office. “I could do that and it’s all set to go. But I’m not looking at doing that if I can.”

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“So keep playing it out because you’re gonna look really bad when it falls, and I guess I’m about 22 and 0 and I’ll keep it that way… ”

Trump Derides MSM Over Biden-Ukraine Story: You’re Gonna Look Really Bad (ZH)

A very smug President Trump brushed aside questions over a whistleblower complaint which reportedly involves promises made to Ukraine in exchange for an investigation into former Vice President Joe Biden. Calling the story “ridiculous” and describing the whistleblower as partisan, Trump said that it “doesn’t matter what I discussed,” adding “but I’ll tell you this, somebody ought to look into Joe Biden’s statement where He talked about billions of dollars that he’s not giving to a certain country unless a certain prosecutor is taken off the case. So, somebody ought to look into that and you wouldn’t because he’s a Democrat. And the fake news doesn’t look into things like that, it’s a disgrace.”

Trump was of course referring to a 2018 incident where Biden openly bragged about strongarming Ukraine into firing their top prosecutor, who was leading a wide-ranging corruption investigation into a natural gas firm whose board Hunter Biden sat on. Continuing on, Trump told reporters: “It was a totally appropriate conversation – it was actually a beautiful conversation.” Trump then warned the press they’re barking up the wrong tree after a “very bad week” in which the New York Times was forced to issue a major correction to an article about alleged sexual misconduct by Supreme Court Justice Brett Kavanaugh, after the two journalists who wrote it failed to include evidence from their own anti-Kavanaugh book which significantly undercut their argument.

“You know the press has had a very bad week with Justice Kavanaugh and all those ridiculous charges, and all of the mistakes made at the New York Times and other places,” said Trum, adding: “You’ve had a very bad week, and this will be better than all of ’em, this is another one. So keep playing it out because you’re gonna look really bad when it falls, and I guess I’m about 22 and 0 and I’ll keep it that way. “…keep asking questions and building it up as big as possible so you can have a bigger downfall.”

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A top Ukrainne offical makes really silly statements: “Clearly, Trump is now looking for kompromat to discredit his opponent Biden, to take revenge for his friend Paul Manafort”..

In Call, Trump Urged Ukraine President 8x To Investigate Biden’s Son (CNBC)

President Donald Trump repeatedly urged Ukraine’s president during a telephone call in July to investigate former Vice President Joe Biden’s son Hunter and his involvement with a Ukraine natural gas company, a new report says. The Wall Street Journal reported that Trump encouraged Ukraine President Volodymyr Zelensky “about eight times to work with Rudy Giuliani, his personal lawyer, on a probe, according to people familiar with the matter.” Biden is the current front-runner in the race to win the Democratic presidential nomination and face the Republican nominee, expected to be Trump, in the 2020 election.

Biden on Friday, when asked about Trump’s claims about him and his son, said, “Not one single credible outlet has given any credibility to his assertions. Not one single one. So I have no comment except the president should start to … be president.” [..] The Journal’s new report came as a top Ukraine official reportedly said that Trump “is looking” for Ukraine officials to investigate business dealings of Biden’s son in that country in an effort “to discredit” Biden as he seeks the Democratic presidential nomination.

The official, Anton Geraschenko, told The Daily Beast that Ukraine is ready to investigate Hunter Biden’s relationship with the Ukraine gas company “as soon as there is an official request.” But, he added, “Currently there is no open investigation.” Geraschenko is a senior advisor to Ukraine’s interior minister, who would be in charge of any investigation of Hunter Biden. “Clearly, Trump is now looking for kompromat to discredit his opponent Biden, to take revenge for his friend Paul Manafort, who is serving seven years in prison,” Geraschenko told The Daily Beast.

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Does this settle the ‘dispute’?

WaPo Reports No “Quid Pro Quo” Offered During Phone Call (ZH)

The latest ‘smoking gun’ Democrats have been clinging to in search of that ever-elusive Trump impeachment may have just imploded – after the Washington Post quietly reported on Friday evening that a July 25 phone call between President Trump and Ukrainian President Volodymyr Zelensky did not contain an explicit quid pro quo if Ukraine launched an investigation into former Vice President Joe Biden’s son as initially reported. While President Trump did reportedly “pressure the recently elected leader to more aggressively pursue” the investigation, “Trump did not raise the issue of American military and intelligence aid that had been pledged to Ukraine, indicating there was not an explicit quid pro quo in that call.”

Of course, it has been reported that there were multiple calls – however one might think that the Washington Post’s super high-level anonymous government source would have access to the others as well, and ostensibly would have leaked the most damaging information available. [..] “The revelation that Trump pushed Zelensky to pursue the Biden probe, which was first reported by the Wall Street Journal, represents the most detailed account so far of the president’s conduct that prompted a U.S. intelligence official to file a whistleblower action against the president.” -Washington Post

So – the current US president asked Ukraine to conduct a legal investigation into the former US Vice President, who openly bragged about withholding $1 billion in US loan guarantees unless they fired the guy investigating his son and his son’s company – and there was no quid pro quo offered in exchange for that investigation – at least not on that phone call.

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Giuliani didn’t go looking, the Ukraine did.

Missing Piece to the Ukraine Puzzle (Solomon)

The coverage suggests Giuliani reached out to new Ukrainian President Volodymyr Zelensky’s team this summer solely because he wanted to get dirt on possible Trump 2020 challenger Joe Biden and his son Hunter’s business dealings in that country. Politics or law could have been part of Giuliani’s motive, and neither would be illegal. But there is a missing part of the story that the American public needs in order to assess what really happened: Giuliani’s contact with Zelensky adviser and attorney Andrei Yermak this summer was encouraged and facilitated by the U.S. State Department. Giuliani didn’t initiate it. A senior U.S. diplomat contacted him in July and asked for permission to connect Yermak with him.

[..] Why would Ukraine want to talk to Giuliani, and why would the State Department be involved in facilitating it? According to interviews with more than a dozen Ukrainian and U.S. officials, Ukraine’s government under recently departed President Petro Poroshenko and, now, Zelensky has been trying since summer 2018 to hand over evidence about the conduct of Americans they believe might be involved in violations of U.S. law during the Obama years . The Ukrainians say their efforts to get their allegations to U.S. authorities were thwarted first by the U.S. embassy in Kiev, which failed to issue timely visas allowing them to visit America. Then the Ukrainians hired a former U.S. attorney — not Giuliani — to hand-deliver the evidence of wrongdoing to the U.S. Attorney’s Office in New York, but the federal prosecutors never responded.

The U.S. attorney, a respected American, confirmed the Ukrainians’ story to me. The allegations that Ukrainian officials wanted to pass on involved both efforts by the Democratic National Committee to pressure Ukraine to meddle in the 2016 U.S. election as well as Joe Biden’s son’s effort to make money in Ukraine while the former vice president managed U.S.-Ukraine relations, the retired U.S. attorney told me. Eventually, Giuliani in November 2018 got wind of the Ukrainian allegations and started to investigate. [..] Ukrainian officials also are discussing privately the possibility of creating a parliamentary committee to assemble the evidence and formally send it to the U.S. Congress, after failed attempts to get the Department of Justice’s attention, my sources say.

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Now, THIS is a take-down. Read the whole thing.

Is WeWork a Fraud? (Hawksberry)

WeWork will never ever, in its short history, generate a profit, let alone the tens of billions in revenues necessary to generate anywhere near the $3 billion in earnings required to (even then generously) value the company at £47 billion. A lot of people could have done what Adam Nuemann & Miguel McKelvey did, they don’t because they’re not prepared to engage in a fraud. They can play dumb all they like but when you fiddle with your financials, invent accounting principles, secretly acquire IP and double deal it for millions of dollars back to your own company, market yourselves misleadingly as a ‘technology’ play, cash out close to $1 billion and use that to acquire buildings to lease back to WeWork, employ half your family etc, etc, etc…please for heavens sake don’t try and convince me that they are unaware of what they are doing.

They know exactly what they’re doing. Adam and Miguel purposefully choose to hide those costs under ‘Community-Adjusted EBITA’s’. Why are they still parading WeWork as a technology company, does anybody believe as cunningly intelligent as they are, that they genuinely think WeWork is a ‘technology’ company? Why have they cashed out, and not just a few million dollars as a deposit on a big mortgage but hundreds of millions to buy buildings that they used to further bleed their own ponzi scheme with?. They have cashed out $1 billion whilst posting losses of $1.9 billion. Since their S1 release, Adam & Miguel have slashed their proposed post-IPO valuation by 86% in 4 re-valuations. The price started at $67 billion, then they quickly dropped it to $30/$40bn before again looking down at their calculator and punching buttons quicker than you can blink and coming back with $15/20bn.

As you’re about to click, it plunges 40% to $10bn. From $67 billion to $10 billion in 7 days. It’s pathetic seeing this kind of desperation. I don’t want to be in the room when he realises it’s not even close to being worth anywhere near $1 billion. Within the last 10 days or so, his wife Rebekah has also removed from her extraordinarily unnecessary position, they’ve hastily elected their first female to their Board, halved Adam’s voting power, lost a Chief Communications Officer, their bonds are crashing, two landlords have begun legal proceedings, their principle investor Masayoshi has publicly called for Adam to delay the IPO, even Alexandria Ocasio-Cortez weighed in and warned vulnerable investors Goldman Sachs & JP Morgan are now targeting… ‘you’re getting fleeced!’.

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“Estimated losses include €31.8bn in Germany, at least €17bn for France, €4.5bn in Italy, €1.7bn in Denmark and €201m for Belgium.”

‘The Men Who Plundered Europe’: Bankers On Trial For Siphoning €60bn (G.)

They have been called “the men who plundered Europe”: a group of cowboy traders, seasoned tax lawyers and mathematical whizz kids who are alleged to have conspired in the heart of the City of London to siphon at least €60bn in taxpayers’ money from the state coffers of several EU countries. In Britain, the so-called “cum-ex” scandal, named after the complex derivatives juggling act employed, gained little attention amid the frenzied debate around the UK’s departure from the European Union when the fraud scheme was discovered in 2017. But in continental Europe what Le Monde has described as the “robbery of the century” has done almost as much to shape the view of Britain as Brexit itself.

Dutch media has called it “organised crime in pinstripe suits” and one of the original German whistleblowers saying he now welcomes Britain’s exit from the EU in the hope it could weaken the influence of London investment banking on European financial institutions. This week, a British former investment banker involved in developing the scheme for the first time gave the public an insight into how the scheme worked and what spurred on its architects. Speaking at a regional court in Bonn, Martin Shields, one of two former bankers on trial for 34 instances of serious tax fraud between 2006 and 2011, painted a picture of a London banking scene which lured in the brightest scientists from the country’s top universities and used them to boost their profit margins – without teaching them about the moral and legal consequences of their actions in return.

“This was the environment at that time: a financial industry that – at least as far as I could see – was geared towards maximum profit optimisation,” the 41-year-old told a packed courtroom on Wednesday. “One tool to achieve this goal was tax optimisation: avoiding taxation as far as possible – and taking advantage of any opportunities that could be found or created. This was not the clandestine approach of a few. Rather, I saw it as the clear and openly communicated expectation of most major banks and their customers.” [..] Estimated losses include €31.8bn in Germany, at least €17bn for France, €4.5bn in Italy, €1.7bn in Denmark and €201m for Belgium.

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Is it too late to stop them?

Desperate Central Bankers Grab for More Power (Brown)

Central bankers are acknowledging that they are out of ammunition. Mark Carney, the soon-to-be-retiring head of the Bank of England, said in a speech at the annual meeting of central bankers in August in Jackson Hole, Wyoming, “In the longer-term, we need to change the game.” The same point was made by Philipp Hildebrand, former head of the Swiss National Bank, in an August 2019 interview with Bloomberg. “Really there is little if any ammunition left,” he said. “More of the same in terms of monetary policy is unlikely to be an appropriate response if we get into a recession or sharp downturn.” “More of the same” meant further lowering interest rates, the central bankers’ stock tool for maintaining their targeted inflation rate in a downturn.

Bargain-basement interest rates are supposed to stimulate the economy by encouraging borrowers to borrow (since rates are so low) and savers to spend (since they aren’t making any interest on their deposits and may have to pay to store them). But over $15 trillion in bonds are now trading globally at negative interest rates, yet this radical maneuver has not been shown to measurably improve economic performance. In fact new research shows that negative interest rates from central banks, rather than increasing spending, stopping deflation, and stimulating the economy as they were expected to do, may be having the opposite effects. They are being blamed for squeezing banks, punishing savers, keeping dying companies on life support, and fueling a potentially unsustainable surge in asset prices.

So what is a central banker to do? Hildebrand’s proposed solution was presented in a paper he wrote with three of his colleagues at BlackRock, the world’s largest asset manager, where he is now vice chairman. Released in August to coincide with the annual Jackson Hole meeting of central bankers, the paper was co-authored by Stanley Fischer, former governor of the Bank of Israel and former vice chairman of the U.S. Federal Reserve; Jean Boivin, former deputy governor of the Bank of Canada; and BlackRock economist Elga Bartsch. Their proposal calls for “more explicit coordination between central banks and governments when economies are in a recession so that monetary and fiscal policy can better work in synergy.” The goal, according to Hildebrand, is to go “direct with money to consumers and companies in order to enliven consumption,” putting spending money directly into consumers’ pockets.

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“The United States had removed tariffs overnight from over 400 Chinese products in response to requests from U.S. companies.”

Hopes For Trade Breakthrough Fade As China Cancels US Farm Visits (R.)

A U.S.-China trade deal appeared elusive on Friday after Chinese officials unexpectedly canceled a visit to farms in Montana and Nebraska as deputy trade negotiators wrapped up two days of negotiations in Washington. Chinese officials were expected to visit U.S. farmers next week as a goodwill gesture, but canceled to return to China sooner than originally scheduled, agriculture organizations from Montana and Nebraska said. The United States had removed tariffs overnight from over 400 Chinese products in response to requests from U.S. companies. The Chinese Embassy and the U.S. Department of Agriculture did not immediately respond to requests for comment.


The U.S. Trade Representative’s office issued a brief statement characterizing the two days as “productive” and that a principal-level trade meeting in Washington would take place in October as previously planned. China’s Commerce Ministry, in a brief statement, described the talks as “constructive”, and said they had also had a good discussion on “detailed arrangements” for the high-level talks in October. [..] Trade experts, executives and government officials in both countries say that even if the September and October talks produced an interim deal, the U.S.-China trade war has hardened into a political and ideological battle that runs far deeper than tariffs and could take years to resolve.

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“(Claiming to be a Cherokee was a forgivable way of sharing — sharing useful identities for career advancement.)”

President of the Selfies (Kunstler)

Unlike the 2016 Democratic presidential candidate, Elizabeth Warren doesn’t radiate contempt, loathing, and horror at the task of mingling with the hoi polloi. Rather, she has become famous for staging lengthy sessions after campaign speeches to pose for selfies with her fans. The selfie-seekers, you will notice, are all women. It’s heartwarming as all get out. This is at the center of Senator Warren’s strategy for winning the next election: to cadge all of the women’s vote and become the President of all the women of the United States. It’s a shrewd strategy, to turn the election into a gender-bonding contest, but elections have turned on equally fatuous premises, probably more often than not.

Paradoxically, the lumbering President Trump, with his bay window belly, mystifying bouffant, fourth-grade vocabulary, and grab-them-by-the-pussy approach to romance, scored 53 percent of women’s votes last time around. Perhaps that was more a reflection of his opponent’s titanic loathsomeness than of Mr. Trump’s charms. But it only underscores Ms. Warren’s gambit: all she has to do is swing a generous majority of American women over to her side.

She is, in many ways, an exemplar of her sex. She’s made the best of her corn-fed Oklahoma looks. At 69, she capers energetically around the hustings in spanx and Nina McLemore jewel-toned, popped-collar jackets as though she were America’s yoga instructor, an appealing addition to her previous career as a distinguished Harvard law professor. She scores well on the feelings and sharing index, qualities that most men can only caricature. (Claiming to be a Cherokee was a forgivable way of sharing — sharing useful identities for career advancement.) And she has a palpable edge of anger about all the swindles and injustices in American life today, especially those spawned on Wall Street by the financial patriarchy — hey, who can argue with that one? If she has a husband (she has, Harvard law prof Bruce H. Mann) he might as well be hiding under a rock.

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Cowards. What, they’re French?

France Rejects Edward Snowden’s Asylum Request, Fears Major Fallout With US (ZH)

France’s foreign minister has indicated the country has dismissed former US National Security Agency contractor and leaker Edward Snowden’s asylum request because “it is not the time”. Snowden called on French President and former Rothschild banker Emmanuel Macron to grant him political asylum from the United States, after he’s been living in Russia since the 2013 bombshell leaks were released, having first fled from Hong Kong. “He asked for asylum in France, but also elsewhere, in 2013. At that time, France thought that it was not appropriate, I do not see anything that has changed Thursday, either from a political or a legal point of view,” French Foreign Minister Jean-Yves Le Drian told French TV station CNews on Thursday.

Paris is skittish over the whole issue due to US pressure and what such a move would do to its close relationship with Washington. “An adviser to French President Emmanuel Macron hinted earlier this week that welcoming Snowden to France would lead to a major diplomatic fallout with the U.S.,” Politico Europe reported. The whistleblower, who this week published his memoir, has escaped US prosecution as a guest of Putin’s Russia. He previously said he would “love to see” Macron allow him to live in France. Snowden made a first asylum appeal to France in 2013, which was rejected, and another last week. “I am not asking for a parade. I’m not asking for a pardon,” he said in a recent interview. “What I’m asking for is a fair trial.”

Speaking with France’s Inter radio on Monday as part of a press junket to promote his new memoir, the former NSA contractor said “Protecting whistleblowers is not a hostile act,” adding “Welcoming someone like me is not an attack on the United States.” “I would like to return to the United States. That is the ultimate goal. But if I’m gonna spend the rest of my life in prison, the one bottom line demand that we have to agree to is that at least I get a fair trial. And that is the one thing the government has refused to guarantee because they won’t provide access to what’s called a public interest defense,” Snowden told CBS This Morning.

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Melzer says here: ““Trying to win any aspect of this case in the judicial arena has been a losing game for almost a decade..”

But that goes both ways. Governments haven’t been able to any more than those who are on Julian’s side. Obama was advised he had no chance in court. It took a highly partial and corrupt UK court to get the job done.

Julian Assange: Justice Denied (Sagir)

Technically, Julian Assange is supposed to be released from his prison cell at HMP Belmarsh on Sunday. Yet a British court ruled last week that he has to remain in prison after the custody period of his current jail term ends due to his “history of absconding.” Assange is no longer a serving prisoner but someone facing extradition. Why is Assange actually being held prisoner? Well, the UN Special Rapporteur on Torture Nils Melzer tells me that Assange’s case is not about law, but rather politics. He says: “Trying to win any aspect of this case in the judicial arena has been a losing game for almost a decade because, from the outset, this case has been decided politically. His right to a fair trial has been systematically violated by all involved states.

“If this were about applying the law, he would have never been convicted of bail violation simply for seeking — and receiving — diplomatic asylum in the Ecuadorian embassy. “If this were about applying the law, he would not be in extradition detention under a US indictment of espionage simply for doing investigative journalism.” It seems that the only thing Assange is on trial for is the publication of the Chelsea Manning leaks. Melzer says: “The only other charge against him is for allegedly trying to help Manning to decode a password, albeit unsuccessfully and without causing any harm whatsoever. “Clearly, that is not a serious crime by any standards, and certainly not an offence any prosecutor would spend substantial resources on.”

[..] after 100 days and counting, the UK has not even responded to my official letter yet and Assange’s state of health is reportedly deteriorating as we speak,” Melzer says. Melzer says he is “appalled” at how Britain is “simply ignoring” his report. He was mandated by the UN human rights council, which includes Britain, to report to states on their compliance with the prohibition of torture and ill-treatment. Once Melzer investigates a case and makes an official finding that an act of torture has been committed, then they have to at least conduct an impartial and transparent investigation into the case, even if they come to different conclusions.

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Front page NY Post today. Brilliant.

 

 

 

 

 

Sep 182019
 
 September 18, 2019  Posted by at 9:40 am Finance Tagged with: , , , , , , , , , ,  10 Responses »


Henri Matisse Antibes 1908

 

Fed Concludes First Repo In A Decade Amid Liquidity Panic (ZH)
Big Banks Score Win As FDIC Proposes Easing Post-Crisis Derivatives Rules (R.)
Oil Steadies After Saudi Pledges To Restore Output Lost In Attacks (R.)
Without Accountability, There Can Never Be Trust in Our Government (Cates)
House Panel Asks Boeing CEO To Testify October 30 on 737 MAX (R.)
Ethiopian Crash Victims Want 737 MAX Documents From Boeing, FAA (R.)
Editorial Mistake My Ass (Mish)
Democrats Urge New Probe Of Kavanaugh, Impeachment Inquiry (R.)
Trudeau Reassures Allies Amid Alleged Spying Case (BBC)
Catastrophic Effects Of Working As A Facebook Moderator (G.)
US Government Is Suing Edward Snowden For His Book Profits (Verge)

 

 

Oh yeah, let’s save the bankers again….

Fed Concludes First Repo In A Decade Amid Liquidity Panic (ZH)

Update 4: It’s over: after a torrid 30 minutes in which the NY Fed first announced a repo operation, then announced the repo was canceled due to technical difficulties, then mysterious the difficulties went away just minutes later, at precisely 10:10am, the Fed concluded its first repo operation in a decade, which while not topping out at the $75 billion max, was nonetheless a significant $53.15 billion, split as follows: • $40.85BN with TSYs as collateral at a 2.1% stop out rate • $0.6BN with Agencies as collateral at a 3.0% stop out rate • $11.7BN with Mortgage-backed securities as collateral at a 2.1% stop out rate. While the Fed did not disclose how many banks participated in the operation, it is safe to say it was a sizable number.


Worse, the result from today’s unexpected repo operation, we can now conclude that in addition to $1.3 trillion in ‘excess reserves’, a Fed which is now cutting rates and will cut rates by 25bps tomorrow, the US financial system somehow found itself with a liquidity shortfall of $53 billion that almost paralyzed the interbank funding market. Oh, and for those wondering why the Fed did a repo, the answer is simple: it did not want to launch QE just yet. But make no mistake, once repo is insufficient, the Fed will have no choice but to escalate to the next step which is open market purchases. Which brings us to the bigger question of how long such overnight repos will satisfy the market, and how long before the next repo rate spike prompts the Fed to do the inevitable, and restart QE. At least president Trump will be delighted.

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And while we’re saving their multi-million bonuses, let’s throw them some more bones,..

Big Banks Score Win As FDIC Proposes Easing Post-Crisis Derivatives Rules (R.)

A U.S. banking regulator on Tuesday proposed easing a rule requiring banks to set aside cash to safeguard derivatives trades between affiliates, marking one of the biggest wins for Wall Street lenders under the business-friendly Trump administration. The proposal, by the Federal Deposit Insurance Corporation, could potentially free $40 billion across the nation’s largest banks, according to a 2018 survey by the International Swaps and Derivatives Association (ISDA), the global trade group that has been lobbying for the rule change for years.


The proposal is subject to public comment and will likely face resistance from Democratic lawmakers and consumer groups, who have warned that chipping away at regulations put in place following the 2007-2009 financial crisis could sew the seeds of the next one. Countries across the globe introduced a slew of rules to rein in the global over-the-counter derivatives market after big bets on credit swaps brought firms including Lehman Brothers and AIG to their knees.

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Was there any damage at all? Didn’t I read that they hit a bunch of empty tanks?

Oil Steadies After Saudi Pledges To Restore Output Lost In Attacks (R.)

Oil prices were little changed on Wednesday, steadying after Saudi Arabia said it will restore by the end of the month production lost in weekend attacks on its facilities. Prices plummeted 6% on Tuesday after Saudi Arabia’s energy minister said the country had managed to restore oil supplies to customers to where they stood before the attacks on its facilities that shut 5% of global oil output by drawing from its huge inventories. But tension in the region remained elevated after the United States said it believed the attacks on the world’s top oil exporter originated in southwestern Iran. Iran has denied involvement in the strikes.


Brent crude oil futures were flat at $64.55 a barrel by 0732 GMT. U.S. West Texas Intermediate (WTI) crude CLc1 futures were down 15 cents, or 0.1%, to $59.19 a barrel, after sinking 5.7% on Tuesday. “Considering limited spare (production) capacity outside Saudi Arabia and risks of renewed attacks on Saudi energy infrastructure, a risk premium is likely to stay on oil prices in the foreseeable future,” UBS analysts said in a note. Energy Minister Prince Abdulaziz bin Salman said on Tuesday that average oil production in September and October would be 9.89 million barrels per day and that the world’s top oil exporter would ensure full oil supply commitments to its customers this month.

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Not sure Bill Barr is your man.

Without Accountability, There Can Never Be Trust in Our Government (Cates)

The Watergate scandal, at its heart, was about political operatives working on behalf of the Nixon administration (informally known as “The Plumbers”) attempting to plant bugs in the phones of the Democratic National Committee (DNC) headquarters at the Watergate Hotel, so they could spy on key Democratic campaign communications. A little-remembered fact is that bugs had been successfully planted earlier; the burglars were returning to plant a new set in the phones because the first set never worked properly. It was during this second foray into DNC headquarters in the middle of the night that they were caught by an observant security guard.

So the Watergate scandal was based on an attempt to spy on political opponents, but no evidence ever surfaced that any successful spying was actually done. The first set of listening devices never functioned, and the operatives were caught while trying to replace them. That won’t be the case in the Spygate scandal, because this wasn’t an off-the-books dirty tricks group like The Plumbers running an operation against the Trump campaign. This was the federal government itself, making use of the official engines of its intelligence and law enforcement agencies and surveillance courts to spy on a political campaign and, then, a presidency. And it’s because this scandal is so much worse than Watergate that the persons responsible for it must be held accountable for their actions.

[..] The crimes here amount to a deliberate attempt to subvert the federal intelligence and law enforcement agencies and turn them into political engines of partisan policy to shield political friends and destroy political enemies. After covering up serious crimes committed by their political friends, these key government officials used their offices to manufacture crimes to use as a pretext to investigate and punish their political enemies. Unless this behavior is punished with the utmost severity, no one will ever be able to place trust in the federal government. The ball of accountability will soon end up in the court of U.S. Attorney General William Barr.

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I for one have little faith in Congress in this case. Not that I have much faith in Congress in general.

House Panel Asks Boeing CEO To Testify October 30 on 737 MAX (R.)

The U.S. House Transportation and Infrastructure Committee formally asked Boeing CEO Dennis Muilenburg on Tuesday to testify on the now grounded 737 MAX that has been involved in two deadly crashes since October 2018 that killed 346 people. The panel’s chair, Representative Peter DeFazio, also asked John Hamilton, the chief engineer of Boeing’s Commercial Airplanes division, to appear. Both executives have been asked to testify on Oct. 30. Last week, DeFazio asked Muilenburg to make several employees available for interviews as part of a congressional probe into the design, development and certification of 737 MAX aircraft. “Boeing has received the Committee’s invitation and is reviewing it now. We will continue to cooperate with Congress and regulatory authorities as we focus on safely returning the MAX to service,” a Boeing representative said in a statement.

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But will they get them? Boeing will just claim they would reveal company secrets.

Ethiopian Crash Victims Want 737 MAX Documents From Boeing, FAA (R.)

A lawyer for victims of Ethiopian Airlines Flight 302 said on Tuesday he wants Boeing Co and the U.S. Federal Aviation Administration to hand over documents about the decision to keep the Boeing 737 MAX in the air after a deadly Lion Air crash last October. A week after Lion Air Flight 610 nose-dived into the Java Sea, killing all 189 aboard, the FAA warned airlines that erroneous inputs from an automated flight control system’s sensors could lead the jet to automatically pitch its nose down, but the agency allowed the jets to continue flying. Five months later, the same system was blamed for playing a role when ET302 crashed on March 10, killing all 157 passengers and crew and prompting a worldwide grounding of the 737 MAX that remains in place.


“The decisions to keep those planes in service are key,” Robert Clifford of Clifford Law Offices, which represents families of the Ethiopian crash victims, said at a status hearing before U.S. Judge Jorge Alonso in Chicago. Nearly 100 lawsuits have been filed against Boeing by at least a dozen law firms representing families of the Ethiopian Airlines crash victims, who came from 35 different countries, including nine U.S. citizens and 19 Canadians. Families of about 60 victims have yet to file lawsuits but plaintiffs’ lawyers said they anticipate more to come. Most of the lawsuits do not make a specific dollar claim, though Ribbeck Law Chartered has said its clients are seeking more than $1 billion.

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The entire Kavanaugh thing is empty, just two women trying to sell a book. Trump said he should sue them. But as a Supreme Court judge, perhaps he shouldn’t.

Editorial Mistake My Ass (Mish)

As details emerge in the New York Times Kavanaugh scandal, it’s very clear the NYT repeatedly made serious errors On September 14, the New York Times resurrected unsubstantiated and graphic rumors about Supreme Court Justice Brett Kavanaugh in a purposeful smear article Brett Kavanaugh Fit In With the Privileged Kids. She Did Not. The article was by disgraced NYT authors Robin Pogrebin and Kate Kelly to promote their upcoming book “The Education of Brett Kavanaugh: An Investigation.” I do not normally report on sleaze but to understand what the NYT did, I have to. Here is one controversial paragraph: “We also uncovered a previously unreported story about Mr. Kavanaugh in his freshman year that echoes Ms. Ramirez’s allegation. A classmate, Max Stier, saw Mr. Kavanaugh with his pants down at a different drunken dorm party, where friends pushed his penis into the hand of a female student.”


The NYT later added this correction. “The book reports that the female student declined to be interviewed and friends say that she does not recall the incident. That information has been added to the article.” Making matters worse for itself, the NYT came out and blamed it all on an “editing error”. Reporters Robin Pogrebin and Kate Kelly said in an interview on MSNBC that they wrote in the draft of their Sunday Review piece that a woman who Kavanaugh was said to have exposed himself to while a student at Yale had told others she had no recollection of the alleged incident. Their editors, they say, removed the reference. “It was just sort of. . . in the haste of the editing process,” said Pogrebin.

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But this is where the non-story leads to. Kamala seeks a way to reinvent her campaign, the rest just follows.

Democrats Urge New Probe Of Kavanaugh, Impeachment Inquiry (R.)

U.S. Senator Kamala Harris on Tuesday urged a House of Representatives panel to investigate Supreme Court Justice Brett Kavanaugh, while a Democratic lawmaker filed an impeachment resolution in the wake of new allegations of sexual misconduct by the conservative judge when he was in college in the 1980s. The moves by Harris, one of 20 Democratic presidential candidates, and Representative Ayanna Pressley, a progressive on the left of the party, signaled impatience among some Democrats with congressional leaders unenthusiastic about pursuing Kavanaugh’s impeachment, though their efforts appeared unlikely to spur action.

Harris said in a letter to House Judiciary Committee Chairman Jerrold Nadler that the panel should “hold Mr. Kavanaugh accountable for his prior conduct and testimony.” Nadler on Monday faulted the FBI’s probe of prior sexual misconduct allegations against Kavanaugh ahead of his narrow confirmation by the Senate in October 2018, saying in a radio interview it “apparently was a sham.” But Nadler also said his panel had its “hands full” with investigating Republican President Donald Trump. In her letter to Nadler, Harris suggested the House Judiciary Committee could create a task force and retain outside counsel if it did not have the time or resources to pursue an inquiry of Kavanaugh now.

Harris and several other Democratic presidential candidates called for Kavanaugh’s impeachment after the New York Times published an essay over the weekend detailing what it described as a previously unreported incident of sexual misconduct by Kavanaugh. Others include former U.S. Housing and Urban Development Secretary Julian Castro; U.S. Senators Elizabeth Warren and Cory Booker; South Bend, Indiana Mayor Pete Buttigieg; and former U.S. Representative Beto O’Rourke.

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Only a Five Eyes spy chief. And whaddaya know, there’s Bill Browder again. See from yesteday: The Magnitskiy Myth Exploded.

Trudeau Reassures Allies Amid Alleged Spying Case (BBC)

Canadian Prime Minister Justin Trudeau has moved to reassure allies in the wake of an alleged spying case with possible international implications. A senior intelligence official was charged last week with violating national security laws. Cameron Ortis had access to information coming from Canada’s global allies, the RCMP national police force said. Canada is in close contact with its intelligence partners over the case, Mr Trudeau says. “We are in direct communications with our allies on security,” the prime minister said while campaigning in Newfoundland on Tuesday. “We are also working with them to reassure them, but we want to ensure that everyone understands that we are taking this situation very seriously.” Canada is a member of the Five Eyes – the intelligence alliance that also includes the US, UK, Australia and New Zealand.


Mr Ortis, who was a director general with the police force’s intelligence unit, is accused of breaching the Security of Information Act and the Criminal Code. The charges filed against him include the “unauthorised communication of special operational information”, possessing a device or software “useful for concealing the content of information or for surreptitiously communicating, obtaining or retaining information”, and breach of trust by a public officer. [..] Mr Ortis was looking into allegations that Russian tax fraudsters had laundered millions of dollars through Canada, a US financier told Reuters. Bill Browder, a high-profile critic of Russian President Vladimir Putin, said he had met Mr Ortis twice in Canada in 2017 after alerting the RCMP to the matter.

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What exactly would you say is Facebook’s role in our society? How about in your life?

Catastrophic Effects Of Working As A Facebook Moderator (G.)

They describe being ground down by the volume of the work, numbed by the graphic violence, nudity and bullying they have to view for eight hours a day, working nights and weekends, for “practically minimum pay”. A little-discussed aspect of Facebook’s moderation was particularly distressing to the contractors: vetting private conversations between adults and minors that have been flagged by algorithms as likely sexual exploitation. Such private chats, of which “90% are sexual”, were “violating and creepy”, one moderator said. “You understand something more about this sort of dystopic society we are building every day,” he added. “We have rich white men from Europe, from the US, writing to children from the Philippines … they try to get sexual photos in exchange for $10 or $20.”


Gina, a contractor, said: “I think it’s a breach of human rights. You cannot ask someone to work fast, to work well and to see graphic content. The things that we saw are just not right.” The workers, whose names have been changed, were speaking on condition of anonymity because they had signed non-disclosure agreements with Facebook. Daniel, a former moderator, said: “We are a sort of vanguard in this field … It’s a completely new job, and everything about it is basically an experiment.” John, his former colleague, said: “I’m here today because I would like to avoid other people falling into this hole. As a contemporary society, we are running into this new thing – the internet – and we have to find some rules to deal with it.

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Pay him in Bitcoin.

US Government Is Suing Edward Snowden For His Book Profits (Verge)

The Justice Department has filed a civil lawsuit against Edward Snowden that would recover all proceeds of his recently released memoir, the department announced on Tuesday. The charges coincide with the official publication of the book, which is titled Permanent Record. Snowden’s memoir was allegedly not submitted to the CIA or NSA for pre-publication review, a required practice among former employees of intelligence agencies. As such, the department considers the book a breach of Snowden’s fiduciary obligations, and names the publishers as co-defendants in the suit.


Given the still-classified programs and materials discussed in the memoir, it is unlikely that the book would have been approved for publication by the agencies. Snowden remains a de facto fugitive from the US government, and would likely face charges under the Espionage Act if he returned to the country. But the new civil case could nonetheless cause problems for Snowden, potentially enjoining his publishers from releasing any of the proceeds from the book. Crucially, the suit does not seek to block the release of Snowden’s memoir, as doing so would be illegal under the First Amendment.

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From Notes on the Next War, 1935

 

 

 

 

 

Sep 142019
 
 September 14, 2019  Posted by at 9:51 am Finance Tagged with: , , , , , , , , , , ,  9 Responses »


Kazimir Malevich Spotrsmeny 1931

 

Saudi Arabia Oil Facilities Ablaze After Drone Strikes (BBC)
Julian Assange To Stay In Prison Over Absconding Fears (BBC)
Hopes Of Clean Break With EU Are Nonsense: Ex-Brexit Official (G.)
Scores Of Councils Say Food Shortages A Risk If UK Crashes Out Of EU (Ind.)
McCabe Lawyer Presses Justice Department To Drop Criminal Case (R.)
Tectonic Rumblings (Kunstler)
Latest Russian Spy Story Looks Like Another Elaborate Media Deception (Taibbi)
Felicity Huffman Shows Rich & Famous Can Get Away With ANYTHING (RT)
Crisis-Hit Boeing Readies Huge Effort To Return 737 MAX To The Skies (R.)
A Person The Most Powerful Government In The World Wanted To Go Away (G.)
‘If I Happen to Fall out of a Window, You Can Be Sure I Was Pushed’ (Spiegel)

 

 

Wonder who’s behind this, and who will get the blame. Not the same thing.

Saudi Arabia Oil Facilities Ablaze After Drone Strikes (BBC)

Drone attacks have set alight two major oil facilities run by the state-owned company Aramco in Saudi Arabia, state media say. Footage showed a huge blaze at Abqaiq, site of Aramco’s largest oil processing plant, while a second drone attack started fires in the Khurais oilfield. The fires are now under control at both facilities, state media said. A spokesman for the Iran-aligned Houthi group in Yemen said it had deployed 10 drones in the attacks. The military spokesman told al-Masirah TV, owned by the Houthi movement and based in Beirut, that further attacks could be expected in the future. Saudi officials have not yet commented on who could be behind the attacks.


“At 04:00 (01:00 GMT), the industrial security teams of Aramco started dealing with fires at two of its facilities in Abqaiq and Khurais as a result of… drones,” the official Saudi Press Agency reported. “The two fires have been controlled.” Abqaiq is about 60km (37 miles) south-west of Dhahran in Saudi Arabia’s Eastern Province, while Khurais, some 200km further south-west, has the country’s second largest oilfield. The Abqaiq plant turns sour crude into sweet crude, producing up to 7 million barrels a day. Aramco says it is the world’s largest “crude oil stabilisation plant”. Saudi security forces foiled an attempt by al-Qaeda to attack the Abqaiq facility with suicide bombers in 2006. The Khurais oilfield came on line in 2009 and is the nation’s second-largest after Ghawar. Khurais reportedly produces 1.5 million barrels a day with estimated recoverable oil reserves of more than 20 billion barrels.

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A circus of evil clowns.

Julian Assange To Stay In Prison Over Absconding Fears (BBC)

Wikileaks co-founder Julian Assange is to remain in prison when his jail term ends because of his “history of absconding”, a judge has ruled. He was due to be released on 22 September after serving his sentence for breaching bail conditions. But Westminster Magistrates’ Court heard there were “substantial grounds” for believing he would abscond again. The Australian, 48, is fighting extradition to the US over allegations of leaking government secrets. He will face a full extradition hearing next year, starting on 25 February, after an extradition request was signed by the then home secretary Sajid Javid in June. Assange received a 50-week sentence in Belmarsh Prison, south-east London, after being found guilty of breaching the Bail Act in April.


He was arrested at the Ecuadorian Embassy, where he took refuge in 2012 to avoid extradition to Sweden over sexual assault allegations – which he has denied. District judge Vanessa Baraitser on Friday told Assange, who appeared by video-link: “You have been produced today because your sentence of imprisonment is about to come to an end. “When that happens your remand status changes from a serving prisoner to a person facing extradition.” She said that his lawyer had declined to make an application for bail on his behalf, adding “perhaps not surprisingly in light of your history of absconding in these proceedings”. “In my view I have substantial ground for believing if I release you, you will abscond again.”

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“..what it does is it takes us legally out of the EU. But what it can’t do is undo all of the very close economic ties that we have with the EU..”

Hopes Of Clean Break With EU Are Nonsense: Ex-Brexit Official (G.)

Claiming a no-deal Brexit represents a clean break with the European Union is “nonsensical”, according to Philip Rycroft, the former permanent secretary at the Department for Exiting the EU. Boris Johnson has promised to extricate the UK from the EU on 31 October “come what may” – and has hinted that he could try to get around legislation mandating him to request a Brexit delay. The Brexit party leader, Nigel Farage, whose party trounced the Tories in May’s European elections, has been urging the PM to deliver a “clean break Brexit” by leaving without a deal. But Rycroft, who was the most senior civil servant at DexEU until March this year, told the Guardian a no-deal Brexit would mark the beginning of a complex series of negotiations.

“It is not a clean break: what it does is it takes us legally out of the EU. But what it can’t do is undo all of the very close economic ties that we have with the EU, on which so much of our trade as a country depends. And nor would we want to undo all of the close security ties that we have with the EU,” he said. “And because of the importance of those ties both for the EU and the UK, it will remain hugely important to have those expressed through a formal relationship. In other words, we’re going to have to negotiate – and that negotiation on the future relationship starts with citizens, money and the border on the island of Ireland. “So the notion that no deal somehow means that we can turn our backs on the EU and break all our ties is just nonsensical.”


Rycroft spent part of his career at the Scottish Office and in the Scottish Executive before working in Nick Clegg’s office during the Tory-Lib Dem coalition government, and helping to coordinate Whitehall’s approach to devolution from the Cabinet Office. He gave a speech on Monday warning that politicians should be thinking carefully about how to protect the union with Scotland and Northern Ireland after Brexit – deal or no deal. “Clearly at the moment, political time has collapsed: everything has become very short term, everyone’s worrying about what’s happening not even next week but tomorrow,” he said. “In those circumstances it’s very different to be lifting their eyes to a more distant horizon. How do we manage as a country, if and when we come out of the EU?”

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Councils are powerless.

Scores Of Councils Say Food Shortages A Risk If UK Crashes Out Of EU (Ind.)

Scores of local councils have said a no-deal Brexit could result in food, medicine and fuel shortages in their constituencies – with many stating that crashing out without an agreement could lead to civil unrest and damage to social care. Official documents from 63 councils uncovered by the People’s Vote campaign have revealed local authorities fear that fundamental services could suffer and others could be cut if the UK crashes out of the EU. It follows the release of the government’s Operation Yellowhammer planning paper, which warned lorries could face delays of up to two and a half days at Dover, and that protest and public disorder would take up “significant” police resources.


Of the councils that released their Brexit “risk registers”, more than two-thirds said food shortages could grip their local area. Many also said this could lead to unchecked contaminated food entering the supply chain. More than half warned of medicine supplies being put at risk, while 59 per cent said fuel could also become scarce leading to a breakdown in their ability to deploy services – on top of the damage caused to the general public. And just under two-thirds said civil unrest, increased tensions between communities and public disorder could be sparked, including Dartford council which warned of an “increase in hate crime” as the area had “always been a target” for extreme right wing groups.

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What do you mean they can’t find evidence?

McCabe Lawyer Presses Justice Department To Drop Criminal Case (R.)

A lawyer for former FBI official Andrew McCabe pressed U.S. prosecutors on Friday to drop their politically sensitive case against him, citing reports that suggest they may be having trouble securing criminal charges. The U.S. Justice Department has been investigating McCabe, the FBI’s former No. 2 official, for more than 1-1/2 years over allegations he misled internal investigators about his decision to share internal communications with a reporter at the height of the 2016 presidential election. Prosecutors and senior officials within the Justice Department, including Deputy Attorney General Jeffrey Rosen, have recommended moving forward with criminal charges, according to sources familiar with the investigation.


But they might have encountered another hurdle. The Washington Post reported on Thursday that a federal grand jury investigating the case had been called back to consider evidence, but had left without returning an indictment. Grand juries are used in the U.S. legal system to assess the validity of possible criminal charges in major cases. To obtain an indictment, U.S. prosecutors typically need to convince the grand jury there is probable cause that a crime has been committed, which is a lower legal standard than that needed to secure a guilty verdict at trial. Proceedings are conducted in secret.

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How does Flynn pay his legal bills?

Tectonic Rumblings (Kunstler)

After Mr. Trump won the 2016 election, he moved to appoint General Flynn as his National Security Advisor. Within a few days, FBI director James Comey pulled off an entrapment gambit to incriminate General Flynn over a conversation he had with Russian Ambassador Sergey Kislyak — as if incoming high officials for foreign policy are not supposed to associate with foreign ambassadors. You understand now that the government had continued its surveillance of General Flynn for years, including tapping his phone when he moved into his White House office. That enabled Mr. Comey to set up a perjury trap. The General was successfully sandbagged this time, kicked offstage, and conned into a guilty plea. He’s been awaiting sentencing for more than a year.

A few months ago, General Flynn fired his old lawyers and hired Sidney Powell, an attorney who literally wrote the book on discovering prosecutorial misconduct in the case of Alaska Senator Ted Stevens, whose prosecution over Mickey Mouse comped hotel bills was thrown out of court by the same Judge, Emmet Sullivan, who presides in the US versus Flynn. Ms. Powell has now declared that she intends to prove “egregious prosecutorial conduct” and suppression of exculpatory evidence against the DOJ lawyers who ran the case against General Flynn. The government never would have had a case if they revealed the FBI’s internal memos on General Flynn.


Attorney Powell is seeking to have the case thrown out of court. The FBI and the DOJ lawyers who conducted the prosecution have stonewalled the court on producing the documents at issue. Judge Sullivan may sense that he’s seen this movie before. The case took on a life of its own long before William Barr was confirmed as attorney general and one wonders if he has any role in ending this damaging farce. Legal protocol may require Judge Sullivan to complete the case one way or another. I wrote in this space a year ago that General Flynn had been subject to prosecutorial misconduct. Now, I’ll venture to assert that if Judge Sullivan does not throw the case out, Mr. Trump will step in and pardon General Flynn, and in doing so will make it clear exactly how and why he was run into court in the first place.

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Matt Taibbi on the story I covered early this week in Pulp Fiction Media

Latest Russian Spy Story Looks Like Another Elaborate Media Deception (Taibbi)

It’s a characteristic of third world countries to have the intelligence world and the media be intertwined enough that it’s not always clear whether the reporters and the reported-about are the same people. When you turn on the TV in Banana Republics, you’re never sure which group is talking to you. We’re now in that same paradigm in America. CNN has hired nearly a dozen former intelligence or counterintelligence officials as analysts in the last few years. Their big get was former Director of National Intelligence James Clapper, but they also now have former deputy FBI chief Andrew McCabe, former FBI counsel James Baker, and multiple former CIA, NSA, and NSC officials.


Meanwhile, former CIA director John Brennan has an MSNBC/NBC gig, as does former CIA and DOD chief of staff Jeremy Bash, and several other ex-spooks. The Washington Post is owned by Jeff Bezos, who doubles as the CEO of one of America’s largest intelligence contractors. This odious situation is similar to 2003-2004, when cable networks were tossing contributor deals to every ex-general and ex-spook they could find while they were reporting on the Iraq invasion. At one point, FAIR.org found that 52 percent of the sources in network newscasts were current or former government officials. The numbers now aren’t quite that skewed, but CNN and MSNBC both employ former senior intelligence officials who comment upon stories in which they had direct involvement, especially the Russia investigation.

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Don’t want to turn into a gossip site, but the difference between 2 weeks and 5 years is a tad much.

Felicity Huffman Shows Rich & Famous Can Get Away With ANYTHING (RT)

That actress Felicity Huffman will go to jail for only 14 days over college entrance fraud shows there are really two justice systems in the US: one for the rich, famous and politically correct – and another for everyone else.
The ‘Desperate Housewives’ star pleaded guilty to paying $15,000 to falsify her daughter Sophia’s SAT – a college admissions test – and was sentenced to two weeks in jail, 250 hours of community service, a $30,000 fine and a year of supervised release. Altogether, a slap on the wrist to a Hollywood celebrity. It did not take long for her case to be contrasted with the fate of Tanya McDowell, a Connecticut woman who falsified a residency document in 2011 to enroll her son in a better school. McDowell ended up getting jailed for five years for first-degree larceny, and would have faced an even longer sentence had she not made a deal with prosecutors.


Comparing the two cases is absolutely apples to apples. That McDowell was later charged with selling drugs to undercover police officers and given a concurrent sentence does not change the severity of her initial punishment – 130 times longer than was meted out to Huffman. Could it be that it’s because Huffman is white and McDowell is black, and the US justice system is irreparably racist, as a lot of people have argued? Another possibility could be Huffman’s fame, fortune – and politics. After her arrest in April, Huffman was revealed to have donated over $10,000 to Democrats, including over $1,500 to the Senate campaign of Kamala Harris – the tough-on-crime prosecutor in San Francisco and California, now running for president.

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What do you guys think, will all regulators comply? How about the public? Do you want to board a 737 MAX?

Crisis-Hit Boeing Readies Huge Effort To Return 737 MAX To The Skies (R.)

As Boeing sets its sights on winning approval to fly its 737 MAX within weeks, following a six-month safety ban, engineers around the world are rolling out plans for one of the biggest logistical operations in civil aviation history. Inside Boeing’s 737 factory at Renton, Washington, south of Seattle, workers have pre-assembled dedicated tool kits for technicians tasked with installing software updates and readying over 500 jets that have sat idle for months, insiders said. Across the globe, Boeing teams are hammering out delivery schedules – and financial terms – with airline customers who have been forced to cancel flights, cut routes and fly aging jetliners while they await the MAX’s return.

Although regulators must still approve the jets for flight, Boeing and airline staff and executives say the world’s largest planemaker is weeks into an elaborate blueprint for production, maintenance and delivery that one source said involves 1,500 engineers – as many as it takes to design a small new jet. Another likened the logistics to a nation “going to war.” Boeing Commercial Airplanes Chief Engineer John Hamilton called the previously unreported mobilization more like an elaborate “ballet,” which includes synchronizing 680 suppliers of everything from carbon brakes to pilot seatbelts.


[..] Once regulators certify the MAX for flight, Boeing will have to mobilize hundreds of mechanics and pilots to bring the roughly 250 stored aircraft out of hibernation. Airlines estimate the process – which includes installing new software, changing fluids and cycling the engines – will take 100 to 150 hours per jet, and months in total for Boeing. In one example highlighting the minute risks that could upend months of planning, a team of employees is analyzing years of data on December snowfall at an airport in rural Moses Lake, Washington – where Boeing has parked some 100 jets – to predict demand for aircraft anti-freeze and runway performance.

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I know Snowden needs to sell his book, but the Guardian? Really? The paper runs a smear campaign against Assange, without whom Snowden would be in a very different set-up.

A Person The Most Powerful Government In The World Wanted To Go Away (G.)

The world’s most famous whistleblower, Edward Snowden, says he has detected a softening in public hostility towards him in the US over his disclosure of top-secret documents that revealed the extent of the global surveillance programmes run by American and British spy agencies. In an exclusive two-hour interview in Moscow to mark the publication of his memoirs, Permanent Record, Snowden said dire warnings that his disclosures would cause harm had not come to pass, and even former critics now conceded “we live in a better, freer and safer world” because of his revelations.

In the book, Snowden describes in detail for the first time his background, and what led him to leak details of the secret programmes being run by the US National Security Agency (NSA) and the UK’s secret communication headquarters, GCHQ. He describes the 18 years since the September 11 attacks as “a litany of American destruction by way of American self-destruction, with the promulgation of secret policies, secret laws, secret courts and secret wars”. Snowden also said: “The greatest danger still lies ahead, with the refinement of artificial intelligence capabilities, such as facial and pattern recognition. “An AI-equipped surveillance camera would be not a mere recording device, but could be made into something closer to an automated police officer.”


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Moscow is not such a bad place. It beats Belmarsh.

‘If I Happen to Fall out of a Window, You Can Be Sure I Was Pushed’ (Spiegel)

Book a suite in a luxury hotel in Moscow, send the room number encrypted to a pre-determined mobile number and then wait for a return message indicating a precise time: Meeting Edward Snwoden is pretty much exactly how children imagine the grand game of espionage is played. But then, on Monday, there he was, standing in our room on the first floor of the Hotel Metropol, as pale and boyish-looking as the was when the world first saw him in June 2013. For the last six years, he has been living in Russian exile. The U.S. has considered him to be an enemy of the state, right up there with Julian Assange, ever since he revealed, with the help of journalists, the full scope of the surveillance system operated by the National Security Agency (NSA).


For quite some time, though, he remained silent about how he smuggled the secrets out of the country and what his personal motivations were. Now, though, he has written a book about it. It will be published worldwide on September 17 under the title “Permanent Record.” Ahead of publication, Snowden spent over two-and-a-half hours patiently responding to questions from DER SPIEGEL.

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Vintage Australia map from 1773

 

 

 

 

 

Sep 072019
 
 September 7, 2019  Posted by at 9:47 am Finance Tagged with: , , , , , , , , , , , ,  13 Responses »


Pablo Picasso Portrait of Dora Maar 1942

 

The Financialization of the US Economy (WS)
Fed Chair Powell Repeats Vow To Act ‘As Appropriate’ (R.)
Tariffs Are No Longer China’s Biggest Problem In The Trade War (CNBC)
Boris Johnson Urged To Become A ‘Brexit Martyr’ (DM)
A Trump Brexit Threatens (Wight)
A Crackup Is Inevitable (Kunstler)
CIA, Mossad, “the Epstein Network” and an Orwellian Nightmare (Whitney Webb)
How MIT Concealed Its Relationship with Jeffrey Epstein (Farrow)
Boeing’s Chief Technical Pilot On The 737 MAX Project Pleads The Fifth (ST)
For The First Time In My Life, I’m Frightened To Be Jewish (David Graeber)
Edward Snowden’s Guardian Angels (F24)

 

 

But services don’t make stuff.

The Financialization of the US Economy (WS)

Service-producing industries dominate the US economy, accounting for over 70% of GDP. And this sector is hopping. Revenues in the major services categories rose 5.3% in the second quarter of 2019, compared to the same quarter a year earlier, to $4.05 trillion, not seasonally adjusted, according to the Commerce Department’s Quarterly Selected Services Estimates released today. For the first two quarters of 2019, service revenues rose 5.5% to $8.0 trillion. The pace of growth so far this year is slightly lower than the hot 6.0% growth for the year 2018.


Four biggies dominate the service sector, and the US economy overall. They accounted for $2.92 trillion in revenues in Q1, or about 72% of total service revenues, with the biggest of them all, finance and insurance, accounting for 32%, up from 31% at the end of last year. It is also the fastest-growing segment, even faster than healthcare, as the US economy is getting more and more financialized. The share of each of the big four of overall service revenues: • Finance and insurance: 32% • Healthcare: 17% • Professional, scientific, and technical services: 12% • “Information” services, such as telecommunications, software, and data processing: 11%.

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Only one act is appropriate: go home. Did you know Jay Powell is worth some $100 million? Do you think he’s concerned about Americans living paycheck to paycheck?

Fed Chair Powell Repeats Vow To Act ‘As Appropriate’ (R.)

The U.S. Federal Reserve will continue to act “as appropriate” to sustain the economic expansion in the world’s biggest economy, Fed Chair Jerome Powell said Friday in Zurich, sticking to a phrase that financial markets have read as signaling further interest-rate reductions ahead. “Our obligation is to use our tools to support the economy, and that’s what we’ll continue to do,” Powell said at the University of Zurich. Still, he said, “We are clearly at a time where there is a range of views” among Fed policymakers meeting Sept. 17-18 to decide on rates.


Powell’s careful wording reflects a split within the U.S. central bank about how best to respond to an economy where the job market and consumer spending are strong but rising trade tensions between Beijing and Washington, Britain’s possibly messy exit from the European Union, and a broad global slowdown pose risks. Boston Fed President Eric Rosengren for instance has made the case for leaving rates where they are until those risks are more tangible in the economic data. Others including St. Louis Fed President James Bullard have called for a half-a-percentage point interest-rate cut to get ahead of the trade war risks and bring the Fed’s policy rate more in line with market expectations. Meanwhile, financial markets are betting Fed policymakers will agree to split the difference and follow their quarter-point rate cut in July with another one later this month.

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Decoupling.

Tariffs Are No Longer China’s Biggest Problem In The Trade War (CNBC)

It’s not the new round of tariffs that went into effect; we’ve been playing the tit-for-tat tariff war for more than a year. It’s not the economic reports; they’ve been a little too mixed lately to force any dramatic moves. It’s not even the decision by Hong Kong administrator Carrie Lam to fully withdraw the controversial mainland extradition bill; it’s still not clear that the Hong Kong unrest would be affected in any way by a trade deal. Given the timing of the change in tone, it seems more likely that what’s making the difference is a realization on both sides that there’s another way this trade war could end – and that possible ending is one the U.S. is very unlikely to lose.


That alternate ending is summed up in one word: decoupling. The decoupling push is quite different than any U.S. efforts to get China to open up more of its economy to American companies. Instead, it focuses on reducing America’s extremely heavy reliance on China for so much of its manufacturing needs. Even if China’s economy weren’t so closed off to so many American goods and services, a strong argument has long been made that the U.S. needs to diversify its sources for imports. While finding those new sources wouldn’t necessarily do anything to dent America’s trade imbalances, it would reduce the risks of a major disruption to the U.S. economy based on disputes or other problems connected to a single foreign country.

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As I wrote yesterday, he has little to lose by resigning.

Boris Johnson Urged To Become A ‘Brexit Martyr’ (DM)

Boris Johnson wrote to all Tory members last night to indicate that he would rather defy the law than beg Brussels for a delay in bringing Britain out of the EU. The Prime Minister said he was only bound ‘in theory’ by a law which is expected to receive Royal Assent on Monday, taking a No Deal Brexit off the table. In his letter, he reiterated his determination to stand firm against Remainers, saying: ‘They just passed a law that would force me to beg Brussels for an extension to the Brexit deadline. This is something I will never do.’ Earlier on Friday he told reporters he would not entertain seeking another deadline extension from Brussels, as the incoming law compels him to do if no agreement is in place by October 19.

He was urged last night by Tory grandee Iain Duncan Smith to hold his nerve, saying he would be ‘martyred’ if he chose to break the law and risk a possible prison sentence for contempt of Parliament. Mr Duncan Smith told The Telegraph: ‘This is about Parliament versus the people. Boris Johnson is on the side of the people, who voted to leave the EU. ‘The people are sovereign because they elect Parliament. But Parliament wants to stop the will of the people.’ If Mr Johnson fails to carry out the will of Parliament, he risks being taken to court and, if a judge ordered him to obey Parliament, he could be held in contempt and even jailed for refusing.


Mr Johnson’s latest plans for a snap election appeared to have been scuppered yet again last night by a ’stitch-up’ between Jeremy Corbyn and Remain parties. Labour, the Lib Dems and Scots and Welsh nationalists agreed to block the public going to the polls before October 31. It leaves the Prime Minister in limbo, forced to choose between resigning or defying a law passed by MPs ruling out a No Deal Brexit.

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“This desire for godlike powers of total creation is precisely why free market ideologues are so drawn to crises and disasters.”

A Trump Brexit Threatens (Wight)

Trump’s otherworldly vice president, Mike Pence, has just said more in one short sentence to unravel the complexities of the Brexit crisis that continues to bedevil the UK, than the ocean of column inches that have been devoted to the subject since the referendum was held in 2016. Speaking at a black tie event in London on Thursday night, attended by an array of business executives, Pence proclaimed, “The minute the UK is out, America is in.” Pence, a man who stands as living proof that human evolution is not wedded to an ever upwards path, delivered these words with the bombast of a Roman proconsul addressing the notables of a soon-to-be client state.

Thus let there be no doubt that the hard no-deal Brexit advocated by the UK’s newly installed Prime Minister Boris Johnson and his supporters is to all intents a Trump Brexit – one that will see the UK economy opened up to the tender mercies of U.S. corporations on terms set not by London but Washington. In other words, we’re talking disaster capitalism on steroids, bringing with it the likely prospect of the decimation of what’s left of the UK’s welfare state, including that most revered totem to social solidarity, the National Health Service (NHS), which since the end of WWII, when it was established, has provided generations of British citizens with free healthcare at the point of need, funded out of general taxation, regardless of social class or personal wealth.


The NHS is therefore a socialist institution in all but name, which Johnson and his privileged right wing establishment acolytes in the hard Brexit camp would sooner see broken up and sold off to U.S. insurance companies in sacrifice to their god, the market. This is regardless of any and all assurances given to the contrary. In her classic work, Shock Doctrine, Naomi Klein writes: “Believers in the shock doctrine [of disaster capitalism] are convinced that only a great rupture – a flood, a war, a terrorist attack – can generate the kind of vast, clean canvases they crave,” while earlier in the same passage, warning that “This desire for godlike powers of total creation is precisely why free market ideologues are so drawn to crises and disasters.”

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National sovereignty.

A Crackup Is Inevitable (Kunstler)

What’s at stake behind all the pushing-and-shoving is the question of national sovereignty. Does it matter anymore? I suspect it will matter increasingly for everyone in many nations, and at a smaller and smaller scale of political divisions so that, for instance, Great Britain itself will be faced with surrendering its dominion over Scotland and Northern Ireland. This is churning in the zeitgeist now, actually has been for some time since the Soviet Union and Yugoslavia cracked up. Even the United States finds itself increasingly disunited and it’s not inconceivable that before the century ends some regions may go their own way. Texans have been talking it up for years, and California is already acting like she’s started divorce proceedings.

China, meanwhile, is whipping its quasi-vassal Hong Kong like a dog because Xi Jinping is not in a position to bust Donald Trump upside the head and Xi’s got to take it out on somebody. Everything was looking so rosy for China as it burst out of its medieval cocoon into industrial adulthood, and now Mr. Trump is ruining the global arrangements that turned the sclerotic old outfit into a global super-dragon. They’ve had a blast driving down the capitalist road — even if they’re actually ruled by communists — but a storm of bad debt is coming up on them from behind, and if it catches up, the joyride is over and some kind of dreadful crackup happens.


All the abiding normality of the past seventy years is slipping away into flux. Modernity is finally yielding – to what? Nobody knows. And nowhere is this more obvious than in the realm of money and economy. Beyond all the other quarrels of modern times — democracy versus communism, Islam versus the West, the wealthy north versus the poor south — one thing remained pretty steady: the flow of oil into the engines of economy. Turned out, the world didn’t have to run out of oil for that normality to fray badly; the oil just had to become marginally unaffordable, and voila! It’s hard for people to grok, especially here in the USA with oil production so far above the old 1970 prior peak that the proposition seems absurd.

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Whitney’s latest. Obvious must read.

CIA, Mossad, “the Epstein Network” and an Orwellian Nightmare (Whitney Webb)

Prior to the public scrutiny of Barak’s relationship to Jeffrey Epstein, following the latter’s arrest this past July and subsequent death, Barak had come under fire for his ties to disgraced film mogul Harvey Weinstein. Indeed, it was Ehud Barak who put Weinstein in contact with the Israeli private intelligence outfit Black Cube, which employs former Mossad agents and Israeli military intelligence operatives, as Weinstein sought to intimidate the women who had accused him of sexual assault and sexual harassment. Former Mossad director Meir Dagan led Black Cube’s board until his death in 2016 and Carbyne co-founder Lital Leshem is Black Cube’s former director of marketing.

After Barak put him in contact with Black Cube’s leadership, Weinstein, according to The New Yorker, used the private spy firm to “‘target,’ or collect information on, dozens of individuals, and compile psychological profiles that sometimes focused on their personal or sexual histories.” In addition, The New Yorker noted that “Weinstein monitored the progress of the investigations personally” and “also enlisted former employees from his film enterprises to join in the effort, collecting names and placing calls that, according to some sources who received them, felt intimidating.”


Yet, more recently, it has been Barak’s close relationship to Epstein that has raised eyebrows and opened him up to political attacks from his rivals. Epstein and Barak were first introduced by former Israeli Prime Minister Shimon Peres in 2002, a time when Epstein’s pedophile blackmail and sex trafficking operation was in full swing.

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Pecunia non olet.

How MIT Concealed Its Relationship with Jeffrey Epstein (Farrow)

The M.I.T. Media Lab, which has been embroiled in a scandal over accepting donations from the financier and convicted sex offender Jeffrey Epstein, had a deeper fund-raising relationship with Epstein than it has previously acknowledged, and it attempted to conceal the extent of its contacts with him. Dozens of pages of e-mails and other documents obtained by The New Yorker reveal that, although Epstein was listed as “disqualified” in M.I.T.’s official donor database, the Media Lab continued to accept gifts from him, consulted him about the use of the funds, and, by marking his contributions as anonymous, avoided disclosing their full extent, both publicly and within the university.


Perhaps most notably, Epstein appeared to serve as an intermediary between the lab and other wealthy donors, soliciting millions of dollars in donations from individuals and organizations, including the technologist and philanthropist Bill Gates and the investor Leon Black. According to the records obtained by The New Yorker and accounts from current and former faculty and staff of the media lab, Epstein was credited with securing at least $7.5 million in donations for the lab, including two million dollars from Gates and $5.5 million from Black, gifts the e-mails describe as “directed” by Epstein or made at his behest. The effort to conceal the lab’s contact with Epstein was so widely known that some staff in the office of the lab’s director, Joi Ito, referred to Epstein as Voldemort or “he who must not be named.”

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By refusing to send documents.

Boeing’s Chief Technical Pilot On The 737 MAX Project Pleads The Fifth (ST)

A former Boeing official who played a key role in the development of the 737 MAX has refused to provide documents sought by federal prosecutors investigating two fatal crashes of the jetliner, citing his Fifth Amendment right against self-incrimination, according to a person familiar with the matter. Mark Forkner, Boeing’s chief technical pilot on the MAX project, invoked the privilege in response to a grand jury subpoena issued by U.S. Justice Department prosecutors looking into the design and certification of the plane, the person said.

Invoking the Fifth to avoid testifying, while a legal right, is sometimes interpreted as an admission of guilt. Its use to resist a subpoena for documents is less common and may only imply a dance between prosecutors and defense attorneys, legal experts say. Forkner, now a first officer for Southwest Airlines, referred questions to his attorney when reached by phone. His attorney, David Gerger, of Houston, did not respond to inquiries.


Forkner, who worked at Boeing from 2011 to 2018, according to his LinkedIn profile, was frequently anxious about the deadlines and pressures faced in the MAX program, going to some of his peers in the piloting world for help, a person who worked on the project previously told The Seattle Times, speaking on condition of anonymity. The MCAS system, designed to move a powerful control surface at the tail to push the airplane’s nose down in certain rare situations, played a critical role in the crashes when the planes nose-dived out of the sky. During the certification process, Forkner suggested to the Federal Aviation Administration (FAA) that MCAS not be included in the pilot manual, according to previous Seattle Times reporting.

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The anti-Corbyn campaign fallout.

For The First Time In My Life, I’m Frightened To Be Jewish (David Graeber)

I am 58 years old, and for the first time in my life, I am frightened to be Jewish. We live in a time when racism is being normalized, when Nazis parade in the streets in Europe and America; Jew baiters like Hungary’s Orban are treated as respectable players on the international scene, “white nationalist” propagandist Steve Bannon can openly coordinate scare-mongering tactics with Boris Johnson in London at the same time as in Pittsburg, murderers deluded by white nationalist propaganda are literally mowing Jews down with automatic weapons. How is it, then, that our political class has come to a consensus that the greatest threat to Britain’s Jewish community is a lifelong anti-racist accused of not being assiduous enough in disciplining party members who make offensive comments on the internet?


For almost all my Jewish friends, this is what is currently creating the greatest and most immediate sense of trepidation, even more than the actual Nazis: the apparently endless campaign by politicians like Margaret Hodge, Wes Streeting, and Tom Watson to weaponize antisemitism accusations against the current leadership of the Labour party. It is a campaign – which however it started, has been sustained primarily by people who are not themselves Jewish – so cynical and irresponsible that I genuinely believe it to be a form of antisemitism in itself. And it is a clear and present danger to Jewish people. To any of these politicians who may be reading this, I am begging you: if you really do care about Jews, please, stop this.

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Justin better act.

Edward Snowden’s Guardian Angels (F24)

After he revealed the National Security Agency’s illegal mass surveillance programmes in 2013, Edward Snowden received help from some unlikely accomplices. Four refugees and their lawyer allowed the whistleblower to escape and stay under the radar, at a time when he was the world’s most wanted man. For 13 days, they sheltered him in their tiny apartments located in the poorest area of Hong Kong, home to the marginalised community of asylum seekers. The mastermind behind the idea of hiding the American fugitive in plain sight was Robert Tibbo, a Canadian human rights lawyer, well known for defending asylum seekers in the region.

Snowden told FRANCE 24 he believes he owes his life to these unexpected allies, who could have turned him in at any time: “They could have written an email to the CIA and they could have gotten a big cheque or they could have finally gotten asylum in exchange. But they would have had to do it by selling someone into a grave. And for that, I’ll never be able to repay them.”


But since their identity was revealed, especially with the release of the Oliver Stone film “Snowden” in 2016, these refugees are being persecuted by Hong Kong authorities. Arrested on several occasions, they have been questioned about their ties with Snowden. The little welfare they received from the government has been cut. Today, they all live in constant fear in Hong Kong. If deported to their home country of Sri Lanka, they could face imprisonment, torture and even death. All of them have applied for asylum in Canada.

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May 172019
 


Caravaggio The seven works of mercy (Sette opere di Misericordia) 1607

 

“Well, I don’t know what will happen now. We’ve got some difficult days ahead. But it really doesn’t matter with me now, because I’ve been to the mountaintop… And I’ve seen the Promised Land. I may not get there with you. But I want you to know tonight, that we, as a people, will get to the Promised Land.”

– Reverend Dr. Martin Luther King Jr, one day before he was murdered

 

What Martin Luther King King won through many hard-fought battles, and in the end through sacrificing his own life, has to be won all over again: freedom, truth, justice. And this time it’s Julian Assange who stands in the frontline. With Chelsea Manning and Edward Snowden by his side. But I know you’re not very likely to agree with that assessment.

For one thing, I picked the kind of headline that will probably make many people not read an essay. But I’m not kidding, and I’m not saying this for effect. Julian Assange is like Martin Luther King in many ways, and he deserves for people to recognize that.

Assange and Dr. King were born in different times, the former 3 years after the latter was murdered. But when anyone wants to talk King’s legacy, then Assange very much IS that legacy. It would be nice if people like Dr. King’s youngest daughter Bernice, who is very vocal on her father’s legacy, would acknowledge this. Her father certainly would have.

What Julian Assange and Martin Luther King have in common is a superior intelligence, combined with unwavering courage and an unrelenting drive for justice and truth. Both men were born so brave they realized that they might have to give their lives for their causes. And then brought that realization into practice. Both in their own way gave their lives for our sins.

Shared intelligence and courage, justice and truth. Unfortunately, another thing the two share is gross and vile sex smears. Which hurt both men much more than anything else thrown at them. Not a coincidence. Sex smears invariably and for good reason work strongest in women. And in Reverend King’s case, his religious following, who were 99% black people. Lose the women and you lose half of your potential support.

In Assange’s case, the smears, which have even been upgraded to ‘rape’, keeps people from standing up for him. Once you have that word attached to you, you will never fully get rid of it no matter what happens. J. Edgar Hoover’s FBI knew this in the 1960’s, and Robert Mueller and James Comey’s FBI certainly never forgot it half a century later.

 

And of course there are many many people saying that Assange is no Martin Luther King, that Dr. King was a much better man than Assange could ever be. I would urge them to study how Dr. King was perceived in the last 10 years of his life. The nation didn’t exactly revere him, far from it. Most didn’t like him at all, he was seen as a troublemaker, including by many black people, who thought he would make their lives even harder. And then there were Hoover’s sex smears.

After his murder, it took just a few years for the first campaign to establish a public holiday in his name to start. 15 years after the murder, in 1983, President Reagan signed it into law. Even if and when such a petition were started in the case of Assange’s death, which we should all hope will be many years away, the odds of it getting anywhere are slim. But the same would have been true in 1965. So there is hope.

Those willing to give their own lives in order to make other people’s lives better, richer, more just, are special people. Not flawless, for that would make them not people, but special. Yes, Jesus is an obvious example. And so is Mahatma Gandhi. And sure, I hear you say Assange is no Jesus and no Gandhi, but the pattern of peaceful resistance cannot be denied.

There are obviously plenty people who fight for what’s right. What makes Assange, Dr. King, Gandhi, Jesus stand out is that they are examples of people standing up to entire empires. They guy standing in front of the tanks in Tienanmen square in 1989 was another one. Dr. King, Gandhi, Jesus were murdered for what they did. The Chinese guy in all probability also was. That leaves us with Assange.

Does he need to die first before we can appreciate and recognize what he has achieved in our names, that he changed the world we live in for good, as in literally for good? Does it really have to end the same way? Julian Assange hasn’t even received his Nobel Peace Prize yet.

 

 

Here’s an article by Roy Peter Clark for the Poynter, November 25, 2014, about the FBI and sex smears.

How the Southern press foiled FBI’s attempt to smear MLK

Is it possible that we have to thank the white Southern press of the 1960s – even the segregationist press – for its restraint in resisting FBI attempts to smear the Rev. Martin Luther King, Jr., with sexual scandal? That question is raised, but not sufficiently developed, in a Nov. 11 New York Times piece written by Yale historian Beverly Gage. She discovered in the files of FBI chief J. Edgar Hoover an uncensored draft of what has been called the “suicide letter.” The letter was part of an elaborate effort to discredit King, who was about to receive the Nobel Peace Prize.


Based on wire taps and audio tapes, the one-page letter, supposedly sent by an outraged black citizen, described in the vivid language of the day examples of King’s marital infidelities and sexual adventures. The writer, actually an FBI agent, threatened to go public in 34 days with details of King’s affairs. “There is only one thing left for you to do,” it read near the end. “You know what it is.”

From the article, a conversation between Gene Patterson, editor of the Atlanta Constitution from 1960-1968, later editor of the St. Petersburg Times, and Howell Raines, political editor of the St. Petersburg Times, who in 1977 published an oral history of the civil rights movement entitled My Soul Is Rested. In that book Patterson describes to Raines how he was approached by the FBI to smear Dr. King:

“An FBI agent was sent to see me with the bugging information that Dr. King had been engaged in extramarital sexual affairs. The FBI agent, obviously under orders of the director, Hoover, because nobody acted without his direction, urged me – he said, ‘Gene,…here you on this paper have raised Dr. King up to be some kind of model American, some kind of saint, some kind of moralist.’ He said, ‘Now, here’s the information, and why don’t you print it?’ The FBI, the secret police of this country!


And I had to explain to him, ‘Look, we’re not a peephole journal. We don’t print this kind of stuff on any man. And we’re not going to do it on Dr. King.’ And I said, ‘Furthermore, I’m shocked that you would be spying on an American citizen, whether it’s Dr. King or some other person because if it can happen to him, it can happen to all of us.’ And I asked him if he thought this wasn’t a misuse of the FBI. But he was highly offended at me, seeing us as an immoral newspaper for not printing back-alley gossip that the secret police of the United States were trying to ruin this man with.”

Patterson told Raines that one of the editors contacted by the FBI was Lou Harris of the Augusta (Ga.) Chronicle, a paper that supported segregation on its editorial pages. Patterson recalls:


“So I had a phone call from Lou Harris one day, and he said, ‘Gene, I had a call from an FBI agent over here, and you’d be amazed at what he told me about Dr. King.’ And I said, ‘Lou, you mean sex exploits.’ …He said, ‘Have you heard about this?’ I said, ‘Yeah, the FBI has been to see me, too.’ And I said, ‘What are you gonna do with it?’ he said, ‘Hell, I wouldn’t print that stuff. That’s beyond the pale.’ And this was a segregationist editor talking to me. And I said, ‘Lou, I’m proud of you. I’m not gonna mess with it either.’”

And then perhaps the most revealing bit.

One night, Patterson found himself on a plane to Atlanta with John Doar, one of Bobby Kennedy’s top aides in the Justice Department. Hoover was a powerful man, but supposedly subject to the direction of the Attorney General. “I want you to tell the attorney general about this,” said Patterson. “He should know what the FBI is up to.”


“Because the more I thought about it,” Patterson said, “the more worried I’d become about the misuse of secret police powers.” Patterson remembered that throughout his narrative, Doar never looked at him, staring straight ahead in stony silence. “And all of a sudden,” said Patterson, “it hit me like a thunderclap that Bobby Kennedy knew about it. I had made Doar very uncomfortable by relating it to him. Not one expression crossed that deadpan face of his. He just did not respond. It was like talking to a dead man.”

A half century after these incidents, the American intelligence and security apparatus have snooping powers well beyond anything that could be imagined by Dr. King, Patterson, and their contemporaries. Imagine the corruption of a J. Edgar Hoover armed with the weapons of the digital age. His original bugging of King, whom he hated and criticized publicly, was not in search of sexual indiscretions. Hoover’s goals were measured by the paranoid politics of his time: that King had consorted with Communists.

 

 

No matter where it leads, no matter what abuses it will bring, I’m going to tell the truth

-Dr. King

 

 

 

 

 

 

Jul 032018
 


Edward Hopper Summer interior 1909

 

Buybacks Are The Only Thing Keeping The Stock Market Afloat (CNBC)
Stock Markets Look Ever More Like Ponzi Schemes (Murphy)
A Japanese Tsunami Out Of US CLOs Is Coming (HC)
The Eurozone’s Coming Debt Crisis (Lacalle)
The ‘Dirty Dozen’ Sectors Of Global Debt (Rochford)
UK’s Latest Brexit Proposal Is Unrealistic, Say EU Officials (G.)
Nassim Taleb Slams “These Virtue-Signaling Open-Borders Imbeciles” (ZH)
Merkel Dodges Political Bullet With Controversial Migrant Deal (AFP)
Austria Says To ‘Protect’ Its Borders After German Migrant Deal (AFP)
Is Facebook A Publisher? In Public It Says No, But In Court It Says Yes (G.)
Tesla’s All-Nighter To Hit Production Goal Fails To Convince Wall Street (R.)
The New York Times Squares off with the Truth, Again (AHT)
Anthony Kennedy and Our Delayed Constitutional Crisis (GP)
‘Snowden is the Master of His Own Destiny’ – Russia (TeleSur)

 

 

And then QE ends.

Buybacks Are The Only Thing Keeping The Stock Market Afloat (CNBC)

Stocks right now are hanging by a thread, boosted by a bonanza of corporate buying unrivaled in market history and held back by a burst in investor selling that also has set a new record. Both sides are motivated by fear, as corporations find little else to do with their $2.1 trillion in cash than buy back their own shares or make deals, while individual investors head to the sidelines amid fears that a global trade war could thwart the substantial momentum the U.S. economy has seen this year. “Corporate cash is going to find a home, and it’s either going to be in buybacks, dividends or M&A activity. What it’s not going to be is in capex,” said Art Hogan, chief market strategist at B. Riley FBR.

“Individuals are looking at the turbulence we’ve seen this year that we had not seen last year. That creates its own sort of exit sign for investors who don’t want to deal with that.” The numbers showing where each side put their cash in the second quarter are striking. Companies announced $433.6 billion in share repurchases during the period, nearly doubling the previous record of $242.1 billion in the first quarter, according to market research firm TrimTabs. Dow components Nike and Walgreens Boots Alliance led the most recent surge in buybacks, with $15 billion and $10 billion, respectively, last week. In all, 31 companies announced buybacks in excess of $1 billion during June.

At the same time, investors dumped $23.7 billion in stock market-focused funds in June, also a new record. For the full quarter, the brutal June brought global net equity outflows to $20.2 billion, the worst performance since the third quarter of 2016, just before the presidential election. The selling is particularly acute in mutual funds, which saw $52.9 billion in outflows during the quarter and are typically more the purview of the retail side.

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“People think their savings and pensions are safe because of rising share prices. They do not realise it is all a con-trick.”

Stock Markets Look Ever More Like Ponzi Schemes (Murphy)

The FT has reported this morning that: “Debt at UK listed companies has soared to hit a record high of £390bn as companies have scrambled to maintain dividend payouts in response to shareholder demand despite weak profitability.” They added: “UK plc’s net debt has surpassed pre-crisis levels to reach £390.7bn in the 2017-18 financial year, according to analysis from Link Asset Services, which assessed balance sheet data from 440 UK listed companies.” So what, you might ask? Does it matter that companies are making sense of low-interest rates to raise money when I am saying that government could and should be doing the same thing?

Actually, yes it does. And that’s because of what the cash is being used for. Borrowing for investment makes sense. Borrowing to fund revenue investment (that is training, for example, which cannot go on the balance sheet but still adds value to the business) makes sense. But borrowing to pay a dividend when current profits and cash flow would not support it? No, that makes no sense at all. Unless, of course, you are CEO on a large share price linked bonus package and your aim is to manipulate the market price of the company. It is that manipulation that is going on here, I suggest. These loans are being used to artificially inflate share prices.

The problem is systemic. In the US the problem is share buybacks, which I read recently have exceeded $5 trillion in the last decade, meaning that US companies are now by far the biggest buyers of their own shares. That is, once again, market manipulation. And this manipulation does matter. People think their savings and pensions are safe because of rising share prices. They do not realise it is all a con-trick. And companies claim that their pension funds are better funded as a result of these share prices, and so they are meeting their obligations to their employees when that too is a con-trick. They may be insolvent when the truth is known, so serious is the fraud.

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Japan plays a strange role in the global economy. It won’t be able to keep that up much longer. The Bank of Japan has many options; none are good.

A Japanese Tsunami Out Of US CLOs Is Coming (HC)

Japan is at the very centre of the global financial system. It has run current account surpluses for decades, building the world’s largest net foreign investment surplus, or its accumulated national savings. Meanwhile, other nations, such as the US, have borrowed from nations like Japan to live beyond their own means, building net foreign investment deficits. We now have unprecedented levels of cross-national financing.

Much of Japan’s private sector saving is placed in Yen with financial institutions who then invest overseas. These institutions currency hedged most of their foreign assets to reduce risk weighted asset charges and currency write down risks. The cost of hedging USD assets has however risen due to a flattening USD yield curve and dislocations in FX forwards. As shown below, their effective yield on a 10 year US Treasury (UST) hedged with a 3 month USDJPY FX forward has fallen to 0.17%. As this is below the roughly 1% yield many financial institutions require to generate profits they have been selling USTs, even as unhedged 10 year UST yields rise. The effective yield will fall dramatically for here if 3 month USD Libor rises in line with the Fed’s “Dot Plot” forecast for short term rates, assuming other variables like 10 year UST yields remain constant.

As Japanese financial institutions sell US Treasuries, which are considered the safest foreign asset, they are shifting more into higher yielding and higher risk assets; foreign bonds excluding US treasuries as well as foreign equity and investment funds. This is a similar pattern to what we saw prior to the last global financial crisis. In essence, Japan’s financial institutions are forced to take on more risk in search of yield to cover rising hedge costs as the USD yield curve flattens late in the cycle. Critically as the world’s largest net creditor they facilitate significant added liquidity for higher risk overseas borrowers late into the cycle.

I follow these flows closely. One area I think is rather interesting is US Collateralised Loan Obligations (CLOs) which Bloomberg reports “ballooned to a record last quarter thanks in large part to unusually high demand from Japanese investors”. CLOs are essentially a basket of leveraged loans provided to generally lower rated companies with very little covenant protection. Alarmingly, some US borrowers have used this debt to purchase back so much of their own stock that their balance sheets now have negative net equity. A recent Fed discussion paper shows in the following chart that CLOs were the largest mechanism for the transfer of corporate credit risk out of undercapitalised banks in the US and into the shadow banking sector. Japanese financial institutions have been the underwriter of much of that risk in their search for yield.

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“This reduction in costs is financed by pensioners and savers who are forced to invest in these debt instruments, often by institutional mandate.”

The Eurozone’s Coming Debt Crisis (Lacalle)

The European Central Bank (ECB) has signaled the end of its asset purchase program and even a possible rate hike before 2019. After more than 2 trillion euros of asset purchases and a zero interest rate policy, it is long overdue. The massive quantitative easing (QE) program has generated very significant imbalances and the risks far outweigh the questionable benefits. The balance sheet of the ECB is now more than 40 percent of the eurozone GDP. The governments of the eurozone, however, have not prepared themselves at all for the end of stimuli. They often claim that deficits have been reduced and risks contained. However, closer scrutiny shows that the bulk of deficit reductions came from lower cost of government debt.

Eurozone government spending has barely fallen, despite lower unemployment and rising tax revenues. Structural deficits remain stubborn, and in some cases, unchanged from 2013 levels. In other words, the problems are still there, they were just hidden for a while, swept under the rug of an ever-expanding global economy. The 19 eurozone countries have collectively saved 1.15 trillion euros in interest payments since 2008 due to ECB rate cuts and monetary policy interventions, according to German media outlet Handelsblatt. This reduction in costs is financed by pensioners and savers who are forced to invest in these debt instruments, often by institutional mandate.

However, that illusion of savings and budget stability will rapidly disappear as most Eurozone countries face massive amounts of debt coming due in the 2018–2020 period and wasted precious years of quantitative easing without implementing strong structural reforms. The recent troubles of Italian banks are just one precursor of things to come. Taxes rose for families and small and medium-sized enterprises, while current spending by governments barely fell, competitiveness remained poor, and a massive 1 trillion euro in nonperforming loans raises doubts about the health of the European financial system.

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Good overview. Crises wherever you look.

The ‘Dirty Dozen’ Sectors Of Global Debt (Rochford)

When considering where the global credit cycle is at, it’s often easy to form a view based on a handful of recent articles, statistics and anecdotes. The most memorable of these tend to be either very positive or negative otherwise they wouldn’t be published or would be quickly forgotten. A better way to assess where the global credit cycle is at is to look for pockets of dodgy debt. If these pockets are few, credit is early in the cycle with good returns likely to lie ahead. If these pockets are numerous, that’s a clear indication that credit is late cycle.

In reviewing global debt, twelve sectors standout for their lax credit standards and increasing risk levels. There’s excessive risk taking in developed and emerging debt, as well as in government, corporate, consumer and financial sector debt. This points to global credit being late cycle. Central banks have failed to learn the lessons from the last crisis. By seeking to avoid or lessen the necessary cleansing of malinvestment and excessive debt, this cycle’s economic recovery has been unusually slow. Ultra-low interest rates and quantitative easing have increased the risk of another financial crisis, the opposite of the financial stability target many central bankers have.

For global debt investors, the current conditions offer limited potential for gains beyond carry. With credit spreads in many sectors at close to their lowest in the last decade, there is greater potential for spreads to widen dramatically than there is for spreads to tighten substantially. Keeping credit duration low, staying senior in the capital structure and shifting up the rating spectrum will cost some carry. However, the cost of de-risking now is as low as it has been for a long time. If the risks in the dirty dozen sectors materialise in the medium term, the losses avoided by de-risking will be a multiple of the carry foregone.

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I’d say it’s about time for the British to wake up to the damage May et al are inflicting on the nation.

UK’s Latest Brexit Proposal Is Unrealistic, Say EU Officials (G.)

A draft of Theresa May’s Brexit plan has already been dismissed as unrealistic by senior EU officials, who say the UK has no chance of changing the European Union’s founding principles. The prime minister is gathering her squabbling ministers at Chequers on Friday for a one-day discussion to thrash out the UK’s future relationship with the EU. But EU sources who have seen drafts of the long-awaited British white paper said the proposals would never be accepted. “We read the white paper and we read ‘cake’,” an EU official told the Guardian, a reference to Boris Johnson’s one-liner of being “pro having [cake] and pro-eating it”. Since the British EU referendum, “cake” has entered the Brussels lexicon to describe anything seen as an unrealistic or far-fetched demand.

May’s white paper is expected to propose the UK remaining indefinitely in a single market for goods after Brexit, to avoid the need for checks at the Irish border. While the UK is offering concessions on financial services, it wants restrictions on free movement of people – a long-standing no-go for the EU. Jean-Claude Piris, a former head of the EU council’s legal service, said it would be impossible for the EU to split the “four freedoms” underpinning the bloc’s internal market, which are written into the 1957 treaty that founded the European project: free movement of goods, services, capital and people. “The EU is in difficulties at the moment; the one and only success which glues all these countries together is a little bit the money and the internal market,” Piris said. “If you fudge the internal market by allowing a third state to choose what they want … it is the beginning of the end.”

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Not easy to find the right position on the topic. But Europe seems to show that uncontrolled immigration leads to the rise of right wing movements. Merkal gave birth to Salvini.

Nassim Taleb Slams “These Virtue-Signaling Open-Borders Imbeciles” (ZH)

As liberals across America continue to attempt to one-up one another with the volume of virtue they can signal, specifically on the question of ‘open borders’ – especially since ‘jenny from the bronx’ victory over the weekend, none other than Nassim Nicholas Taleb unleashed a trite 3-tweet summary of how farcical this argument is…

What intellectuals don’t get about MIGRATION is the ethical notion of SYMMETRY:

1) OPEN BORDERS work if and only if the number of pple who want to go from EU/US to Africa/LatinAmer equals Africans/Latin Amer who want to move to EU/US

2) Controlled immigration is based on the symmetry that someone brings in at least as much as he/she gets out. And the ethics of the immigrant is to defend the system as payback, not mess it up. Uncontrolled immigration has all the attributes of invasions.

3) As a Christian Lebanese, saw the nightmare of uncontrolled immigration of Palestinians which caused the the civil war & as a part-time resident of N. Lebanon, I am seeing the effect of Syrian migration on the place.

So I despise these virtue-signaling open-borders imbeciles.

Silver Rule in #SkinInTheGame

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Mutti’s holding centers.

Merkel Dodges Political Bullet With Controversial Migrant Deal (AFP)

German Chancellor Angela Merkel survived a bruising challenge to her authority with a compromise deal on immigration but faced charges Tuesday that it spelt a final farewell to her welcoming stance toward refugees. In high-stakes crisis talks overnight, Merkel had put to rest for now a dangerous row with her hardline Interior Minister Horst Seehofer that had threatened the survival of her fragile coalition government. In separate statements, Merkel praised the “very good compromise” that she said spelt a European solution, while Seehofer withdrew a resignation threat and gloated that “it’s worth fighting for your convictions”.

In a pact both sides hailed as a victory, Merkel and Seehofer agreed to tighten border controls and set up closed holding centres to allow the speedy processing of asylum seekers and the repatriations of those who are rejected. They would either be sent back to EU countries that previously registered them or, in case arrival countries reject this – likely including frontline state Italy – be sent back to Austria, pending an agreement with Vienna. CSU general secretary called the hardening policy proposal the last building block “in a turn-around on asylum policy” after a mass influx brought over one million migrants and refugees.

But criticism and doubts were voiced quickly by other parties and groups, suggesting Merkel may only have won a temporary respite. Refugee support group Pro Asyl slammed what it labelled “detention centres in no-man’s land” and charged that German power politics were being played out “on the backs of those in need of protection”. Bernd Riexinger of the opposition far-left Die Linke party spoke of “mass internment camps” as proof that “humanity got lost along the way” and urged Merkel’s other coalition ally, the Social Democrats (SPD), to reject the plan.

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And Merkel made Kurz possible, too.

Austria Says To ‘Protect’ Its Borders After German Migrant Deal (AFP)

Austria’s government warned Tuesday it could “take measures to protect” its borders after Germany planned restrictions on the entry of migrants as part of a deal to avert a political crisis in Berlin. If the agreement reached Monday evening is approved by the German government as a whole, “we will be obliged to take measures to avoid disadvantages for Austria and its people,” the Austrian government said in a statement. It added it would be “ready to take measures to protect our southern borders in particular,” those with Italy and Slovenia. German Chancellor Angela Merkel reached a deal Monday on migration with her rebellious interior minister, Horst Seehofer, to defuse a bitter row that had threatened her government.

Among the proposals is a plan to send back to Austria asylum seekers arriving in Germany who cannot be returned to their countries of entry into the European Union. Austria said it would be prepared to take similar measures to block asylum seekers at its southern borders, with the risk of a domino effect in Europe. “We are now waiting for a rapid clarification of the German position at a federal level,” said the statement, signed by Austria’s conservative Chancellor Sebastian Kurz and his allies of the far-right Freedom party, Vice Chancellor Heinz-Christian Strache and Interior Minister Herbert Kickl. “German considerations prove once again the importance of a common European protection of the external borders,” the statement said.

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Wonder what the strategy meetings were like.

Is Facebook A Publisher? In Public It Says No, But In Court It Says Yes (G.)

Facebook has long had the same public response when questioned about its disruption of the news industry: it is a tech platform, not a publisher or a media company. But in a small courtroom in California’s Redwood City on Monday, attorneys for the social media company presented a different message from the one executives have made to Congress, in interviews and in speeches: Facebook, they repeatedly argued, is a publisher, and a company that makes editorial decisions, which are protected by the first amendment. The contradictory claim is Facebook’s latest tactic against a high-profile lawsuit, exposing a growing tension for the Silicon Valley corporation, which has long presented itself as neutral platform that does not have traditional journalistic responsibilities.

The suit, filed by an app startup, alleges that Mark Zuckerberg developed a “malicious and fraudulent scheme” to exploit users’ personal data and force rival companies out of business. Facebook, meanwhile, is arguing that its decisions about “what not to publish” should be protected because it is a “publisher”. In court, Sonal Mehta, a lawyer for Facebook, even drew comparison with traditional media: “The publisher discretion is a free speech right irrespective of what technological means is used. A newspaper has a publisher function whether they are doing it on their website, in a printed copy or through the news alerts.” [..] Mehta argued in court Monday that Facebook’s decisions about data access were a “quintessential publisher function” and constituted “protected” activity, adding that this “includes both the decision of what to publish and the decision of what not to publish”.

David Godkin, an attorney for Six4Three, later responded: “For years, Facebook has been saying publicly … that it’s not a media company. This is a complete 180.” Questions about Facebook’s moral and legal responsibilities as a publisher have escalated surrounding its role in spreading false news and propaganda, along with questionable censorship decisions. Eric Goldman, a Santa Clara University law professor, said it was frustrating to see Facebook publicly deny that it was a publisher in some contexts but then claim it as a defense in court. “It’s politically expedient to deflect responsibility for making editorial judgements by claiming to be a platform,” he said, adding, “But it makes editorial decisions all the time, and it’s making them more frequently.”

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He did pull it off. But it may be too little too late. Biggest no-no: Model 3 was supposed to be $35,000. ended up at $78,000.

Tesla’s All-Nighter To Hit Production Goal Fails To Convince Wall Street (R.)

Tesla’s burning the midnight oil to hit a long-elusive target of making 5,000 Model 3 vehicles per week failed to convince Wall Street that the electric carmaker could sustain that production pace, sending shares down 2.3% on Monday. Tesla met the target by running around the clock and pulling workers from other projects, workers said. The company also took the unprecedented step of setting up a new production line inside a tent on the campus of its Fremont factory, details of which Chief Executive Elon Musk tweeted last month. Tesla’s heavily-shorted shares rose as much as 6.4% to $364.78 in early trading, but sank after several analysts questioned whether Tesla would be able to sustain the Model 3 production momentum, which is crucial for the long-term financial health of the company.

“In the interim, we do not see this production rate as operationally or financially sustainable,” said CFRA analyst Efraim Levy. “However, over time, we expect the manufacturing rate to become sustainable and even rise.” Levy cut CFRA’s rating on Tesla stock to “sell” from “hold.” Tesla, which Chief Executive Elon Musk hailed on Sunday as having become a “real car company,” said it now expects to boost production to 6,000 Model 3s per week by late August, signaling confidence about resolving technical and assembly issues that have plagued the company for months. Tesla also reaffirmed a positive cash flow and profit forecast for the year. Tesla has been burning through cash to produce the Model 3. Problems with an over-reliance on automation, battery issues and other bottlenecks have potentially compromised Tesla’s position in the electric car market as a host of competitors prepare to launch rival vehicles.

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NATO is “justified by the need to manage the security threats provoked by its enlargement.”.

The New York Times Squares off with the Truth, Again (AHT)

Whenever I’m having a rough day and need a pick-me-up, I turn to The New York Times’ editorial page. It’s always a gas to see how far the empire’s leading propaganda outfit is prepared to go in its mission to pull the wool over we the people’s gullible little eyes. The good editors have come through for me again with their latest entry, “Trump and Putin’s Too-Friendly Summit.” (Original title: “Trump and Putin: Best Frenemies for Life”). No doubt the original headline was deemed rather too impish for such a serious newspaper—it might, for instance, have alerted readers to the fact that the editorial’s content is not to be taken very seriously—and so was understandably jettisoned.

“One would think,” the editors write, “that the president of the United States would let Mr. Putin know that he faces a united front of Mr. Trump and his fellow NATO leaders, with whom he would have met days before the [Putin] summit in Helsinki.” Alas, during said meeting Trump reportedly remarked that “NATO is as bad as NAFTA”—the “free trade” agreement that has succeeded in decimating most of the manufacturing jobs spared by the automation wrecking ball. In other words, Trump does not necessarily think it’s a good idea to encircle Russia with a hostile military alliance whose existence, according to geopolitical expert Richard Sakwa, is “justified by the need to manage the security threats provoked by its enlargement.” (If you haven’t read Professor Sakwa’s comprehensive study of the Ukrainian crisis, Frontline Ukraine, put it at the top of your summer reading list.)

One notes the Turgidsonian delight with which the Times reminds us that, should push come to shove, we’ve got those Russki bastards outgunned. Of course, gullibles like you and I are to pay no mind to the fact that such a confrontation (a military one, for the Times brought up NATO) would almost certainly involve a nuclear exchange, rendering the disparity in manpower that so excites the Times totally meaningless. No, what’s important is that NATO has twenty-nine member states and counting, while the Warsaw Pact was dissolved twenty-seven years ago: ergo, unless he wants the old mailed fist, Putin had better ask “how high?” when we tell him to jump. One would be hard-pressed to come up with a more delusional assessment of where things stand.

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“We are in that constitutional crisis now, but just at the start of it.”

Anthony Kennedy and Our Delayed Constitutional Crisis (GP)

Like “swing vote” Justice Sandra Day O’Connor before him, “swing vote” justice Anthony Kennedy has been one of the worst Supreme Court jurists of the modern era. With swing-vote status comes great responsibility, and in the most consequential — and wrongly decided — cases of this generation, O’Connor and Kennedy were the Court’s key enablers. They • Cast the deciding vote that made each decision possible • Kept alive the illusion of the Court’s non-partisan legitimacy. Each of these points is critical in evaluating the modern Supreme Court. For two generations, it has made decisions that changed the constitution for the worse. (Small “c” on constitution to indicate the original written document, plus its amendments, plus the sum of all unwritten agreements and court decisions that determine how those documents are to be interpreted).

These horrible decisions are easy to list. They expanded the earlier decision on corporate personhood by enshrining money as political speech in a group of decisions that led to the infamous Citizens United case (whose majority opinion, by the way, was written by the so-called “moderate” Anthony Kennedy); repeatedly undermined the rights of citizens and workers relative to the corporations that rule and employ them; set back voting rights equality for at least a generation; and many more. After this next appointment, many fear Roe v. Wade may be reversed. Yet the Court has managed to keep (one is tempted to say curate) its reputation as a “divided body” and not a “captured body” thanks to its so-called swing vote justices and the press’s consistent and complicit portrayal of the Court as merely “divided.”

The second point above, about the illusion of the Court’s legitimacy, is just as important as the first. If the Court were ever widely seen as acting outside the bounds of its mandate, or worse, seen as a partisan, captured organ of a powerful and dangerous political minority (which it certainly is), all of its decisions would be rejected by the people at large, and more importantly, the nation would plunged into a constitutional crisis of monumental proportions. We are in that constitutional crisis now, but just at the start of it. We should have been done with it long ago. Both O’Connor and Kennedy are responsible for that delay.


Image credit: Mike Thompson / Detroit Free Press

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A tale of two refugees
Putin: Snowden is free to do whatever he wants
Lenin: I ordered Assange to be gagged and isolated and am coordinating “next steps” with US

‘Snowden is the Master of His Own Destiny’ – Russia (TeleSur)

United States President Donald Trump is expected to pressure Russia to hand over NSA whistleblower Edward Snowden in exchange for sanctions relief at the upcoming Trump-Putin summit; however, Russia has emphasized that they “are not in a position” to expel Snowden and will “respect his rights” if any such attempt is made. “I have never discussed Edward Snowden with (Donald Trump’s) administration,” Russian Foreign Minister Sergey Lavrov said to Channel 4 reporters. “When he (Putin) was asked the question, he said this is for Edward Snowden to decide. We respect his rights, as an individual. That is why we were not in a position to expel him against his will because he found himself in Russia even without a U.S. passport, which was discontinued as he was flying from Hong Kong.”

Snowden, who is being prosecuted in the United States for leaking classified documents that showed surveillance abuse by U.S. intelligence agencies, was given political asylum in Russia after his passport was revoked. “Edward Snowden is the master of his own destiny,” Lavrov said. Trump is meeting with Russian President Vladimir Putin on July 16 in Helsinki, where Putin is expected to push for an end to U.S. sanctions. Trump has said he would like better relations with Russia, perhaps as a way of pulling them away from China, but Trump’s opponents in the United States are already applying political pressure on him for holding the summit, in the midst of the tensest U.S.-Russian relations since the height of the Cold War.

The fate of Wikileaks founder Julian Assange also lay in the balance when U.S. Vice President Mike Pence met with Ecuador’s President Lenin Moreno this week. “The vice president raised the issue of Mr. Assange. It was a constructive conversation. They agreed to remain in close coordination on potential next steps going forward,” a White House official said in a statement.

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Jun 302018
 


Paul Gauguin We hail thee Mary 1891

 

If The US Middle Class Disappears So Will The US Economy (Hutch)
Nervous Investors Exiting US Stocks At Near-Record Pace (CNBC)
Emerging Markets Are In A Death Cross (CNBC)
Are Central Banks Embracing Too Much Risk? (R.)
Stress Test Results Signal More Flexible New-Look Fed (R.)
EU Warns Deep Disputes With UK Threaten No-Deal Brexit (Ind.)
EU Leaders Say Post-Brexit Single-Market Access For Goods A Nonstarter (G.)
Hidden Figures (Jim Kunstler)
Canada Hits US With Retaliatory Tariffs: ‘We Will Not Back Down’ (G.)
Merkel Confirms Bilateral Migrant Agreements With Spain And Greece (DW)
Not Up To US To Decide On Assange Asylum, Ecuador Says (AFP)
Edward Snowden Calls Russian Government ‘Corrupt’ (Ind.)
The Great Firewall Of China (G.)

 

 

“..the “Walmartization” of America.”

If The US Middle Class Disappears So Will The US Economy (Hutch)

Economies have ebbs and flows. In spite of what they teach you in economics 101 nothing is ever in equilibrium. There are just too many parts as well as internal and external influences although there are times when activity is stronger than others. The US built one of the greatest economic powerhouses on earth after World War II, however it was already well on its way from the 1800s as it built out its infrastructure and put many to work. There was a time when the US consumed the majority of what it produced as a nation and then exported the remainder. Who was responsible for the consumption? It was the middle class. The middle class made up the majority of the population. They had jobs and respectable salaries. So what happened?

According to a research report by the Pew Research Center in 2012, “The Lost Decade of the Middle Class” they state: “For the half century following World War II, American families enjoyed rising prosperity in every decade—a streak that ended in the decade from 2000 to 2010, when inflation-adjusted family income fell for the middle income as well as for all other income groups, according to U.S. Census Bureau data.” The above graph shows that the 50s and 60s had the strongest middle class. In 1950 and 1951 the US had successive years of 8% GDP growth. The report also highlights how the net worth of middle income families—that is, the sum of assets minus debts— took a hit from 2001 to 2010 from the Federal Reserve’s Survey of Consumer Finances. Median net worth fell 28%, to $93,150, erasing two decades of gains.

So we have a situation where consumer debt has increased over the years and incomes have fallen. There are a large number of reasons for this. The manufacturing base has shrunk as companies chose to produce goods in other countries in order to take advantage of cheap labour so they could give themselves pricing advantages. There is, what has become to be known as the “Walmartization” of America. Author John Atcheson writes, “If you want to know why the middle class disappeared and where they went, look no further than your local Walmart. People walked in for the low prices, and walked out with a pile of cheap stuff, but in a figurative sense, they left their wages, jobs, and dignity on the cutting room floor of the House of Cheap.” Driving prices lower and lower is just a race to the bottom that erodes everyone’s quality of life.

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Safety.

Nervous Investors Exiting US Stocks At Near-Record Pace (CNBC)

Investors bailed out of U.S. stocks at a near-record pace in the last week, as money flowing into Treasury bills surged to a 10-year high. Outflows from U.S. stock funds and ETFs totaled $24.2 billion, the third-highest ever, and the $30 billion that came out of global stock funds in total in the past week was the second-highest ever and largest since the financial crisis, according to Bank of America Merrill Lynch strategists. The outflows from U.S. stocks were the highest since the stock market correction in February. Bonds, at the same time, saw small inflows of $700 million. “That nervousness, the losses people were experiencing in non-U.S. markets with the trade wars has probably led to what you’re seeing in the markets in the last week or so — a big unwind of positioning, a flight to quality,” said Michael Hartnett, BofAML chief investment strategist.

Hartnett said there was a “pervasive euphoria” about the U.S. at the beginning of the year and that has faded. Now, investors are adjusting positions, not panicking, though T-bills, considered the safest of safe haven bets, continued to pull in funds at a rapid pace. “It’s not like it’s February 2016. It’s not like we’re staring recession in the face, and everyone is cashed up to the eyeballs and policymakers are panicking. That’s not what’s happening. It’s just that people were pricing in Goldilocks forever earlier on in the year, and that was wrong. They’re probably unwinding that positioning,” he said. “It helps explain why the markets have firmed up in the last couple of days. You want to buy fear and sell greed.” Hartnett said July could be a month where investors sell volatility, but then the market could get rockier in August and September, ahead of the midterm elections.

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Prone to get a whole lot worse.

Emerging Markets Are In A Death Cross (CNBC)

Emerging markets are feeling the heat. China is in a bear market, Brazil is closing in on one, and the EEM emerging markets ETF could close out its worst quarter in nearly three years on Friday. Brace for more pain, says one technical analyst. “There’s really a time to own EEM and it’s time not to own EEM,” Piper Jaffray’s chief market technician Craig Johnson told CNBC’s “Trading Nation” on Thursday. “Our rising dollar is going to be an issue for EEM in here and it looks like to me you got probably another 12 percent downside before you get down to a material support area.”

A 12 percent decline from Thursday’s close would put the EEM ETF at around $37.50, its lowest level since March 2017. On Friday afternoon it had risen 1.5 percent to $43.35. The EEM ETF has also entered a death cross, a technical red flag for Johnson. A death cross marks the point on a chart where a longer-term moving average, such as the 200-day, breaks above a shorter-term moving average, such as the 50-day. The technical indicator demonstrates a sharp breakdown in a security’s price and often prefaces further downside.

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How is that a question?

Are Central Banks Embracing Too Much Risk? (R.)

Central banks are usually thought of as very conservative institutions; if they were cars they would be safe, family sedans. Lately, though, some central banks have been doing the market equivalent of zipping around in a sporty convertible. In recent years, at least two large central banks have been snapping up large quantities of equities, typically considered a risky investment. The Swiss National Bank now has about 20% of its reserves in equities, up from about 7 percent a decade ago. More than half of that is in U.S. equities. And to say that the Bank of Japan has become a player in that country’s equity market is an understatement; BOJ currently owns nearly 75% of the Japanese exchange-traded fund (ETF) market, again up sharply from just a few years ago.

Other central banks, including the European Central Bank and South African Reserve Bank, also make similar purchases, although Japan and Switzerland are the most aggressive buyers of equities. If the idea of a central bank owning a significant amount of stock in a company sounds strange to you, that’s hardly surprising. In the United States, for example, the Federal Reserve Bank is legally prohibited from owning equities, and instead invests its reserves in bonds and other government-backed securities. Some other countries, obviously, have different rules in their bank charters, and modest equity holdings have been a central bank strategy for years. Even so, the practice of central banks owning significant shares of equities is a very recent phenomenon. So why is it happening now, and what kind of risks does this unprecedented trend carry?

In the case of Japan, the motive is clear: for decades the country has had difficulty sustaining economic growth, and the Bank of Japan has already exhausted more traditional forms of stimulus, such as interest rate cuts and bond purchases. Both Prime Minister Shinzo Abe and BOJ Governor Haruhiko Kuroda have been at pain to stimulate growth and defy expectations of deflation. Switzerland’s bank, by contrast, seems to be acting more like an aggressive individual investor: it has been buying stocks because that is where money is to be made. Unbeknownst to many American investors, the Swiss National Bank is a significant shareholder in well-known American firms like Amazon, Apple, Facebook and Microsoft.

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All in for Wall Street.

Stress Test Results Signal More Flexible New-Look Fed (R.)

This year’s Federal Reserve stress test results suggested a more flexible approach, a further sign the regulator’s new leadership is responding positively to a Wall Street push for pragmatic bank supervision, analysts and lawyers said. Banks that took a one-off capital hit due to the 2017 U.S. tax overhaul got a conditional pass, a departure from the Fed’s traditional strict pass-fail approach to quantitative capital issues, while scandal-plagued Wells Fargo was able to double share buyback plans. Goldman Sachs and Morgan Stanley were dinged since their capital fell below the Fed’s minimum, but the regulator’s response this year sounded a more industry-friendly tone under Chairman Jerome Powell and Vice Chairman Randal Quarles, President Donald Trump appointees, analysts and lawyers said.

“They have allowed firms to pass on the basis there were special circumstances and applied a level of pragmatism in the way they haven’t in the past. This is the new Fed and it signals to me an early retirement of this super-strict quantitative test,” said Mike Alix, financial services risk leader at PwC. The Fed on Thursday approved the capital plans of 34 lenders following the second leg of its annual tests, a process introduced after the 2007-2009 financial crisis to assess banks’ capacity to withstand a severe recession. The U.S. central bank has ramped up its worst-case scenarios each year.

The U.S. tax code rewrite signed into law in December meant Goldman and Morgan Stanley’s Thursday results were weighed, in part, by changes to the treatment of past losses on hypothetical tax bills under the Fed’s scenarios. But since the tax issue was a one-off and capital levels in the system are high, the Fed felt it was unnecessary to fail the two banks, senior Fed officials said.

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“Asked about Ms May’s dinner speech on Friday morning, Leo Varadkar, the Irish prime minister, looked confused, and said: “There was a speech? Haha.”

EU Warns Deep Disputes With UK Threaten No-Deal Brexit (Ind.)

The European Union has warned that “serious divergence” between itself and Britain in Brexit talks risks the possibility of a no deal, following a meeting by the 27 national leaders in Brussels on Friday. After roughly an hour of discussion, leaders signed off a joint statement pledging to prepare for the possibility of a no-deal situation and highlighting their “concern” at the lack of progress on the Irish border issue. Speaking ahead of the meeting, Michel Barnier, the European Commission’s chief negotiator, warned: “On Brexit, we have made progress, but huge and serious divergence remains, in particular on Ireland and Northern Ireland.”

Mr Barnier called for “workable and realistic proposals” to be included in a UK government white paper scheduled for release next month. He added that “time is very short” and said UK negotiators should return to Brussels on Monday to intensify talks. The EU says a deal must be struck before October to stop Britain crashing out of the bloc in March without a transition period – a scenario that would be expected to cause economic chaos. Theresa May on Thursday night addressed leaders over dinner about Brexit for 10 minutes but her speech was apparently overshadowed by hours of discussions about the EU migration crisis, the main focus of the summit. Asked about Ms May’s dinner speech on Friday morning, Leo Varadkar, the Irish prime minister, looked confused, and said: “There was a speech? Haha.”

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One long litany of nonstarters.

EU Leaders Say Post-Brexit Single-Market Access For Goods A Nonstarter (G.)

Theresa May has been told by European leaders that an attempt to protect the UK’s industrial base by gaining single market access for goods alone after Brexit is a nonstarter, as the Irish prime minister warned: “We are not going to let them destroy the European Union.” After being given a “broad brush approach” presentation at a Brussels summit of May’s long-awaited paper, yet to be signed off by her warring British cabinet, the taoiseach, Leo Varadkar, told her that unless the final document presented a departure from the UK government’s thinking over the last two years, it would be dead on arrival. The British government is continuing to push the idea of keeping frictionless trade on goods, claiming that it would be a good deal for Europe, given the large trade surplus it enjoys.

May has promised to publish her vision for the future trading relationship after a cabinet meeting at Chequers on Friday. Speaking at the end of a summit dominated by a row over migration, Donald Tusk, the European council president, said that “quick progress” in the Brexit negotiations was needed for there to be any hope of an agreement in October, at what is increasingly being billed as a make-or-break summit. “This is the last call to lay the cards on the table,” Tusk said, of the EU’s call for a workable plan. The French president, Emmanuel Macron, said: “There is a clear message in this respect – we can no longer wait”.

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Anyone seen Jeff Sessions lately?

Hidden Figures (Jim Kunstler)

Now, Mr. Trey Gowdy (R – SC) is a different breed of porpoise among congressmen, kind of legal man-eating orca. In look and demeanor, he comes off as a cross between Atticus Finch and the young feller who played the banjo so well in the opening scenes of Deliverance. Mr. Rosenstein didn’t dare lay any mirthful smirky trips on Mr. Gowdy, who radiated the consolidated wrath of the legislative branch at this flock of executive branch popinjays. Mr. Gowdy, who is declining to run for his seat this year, may be bound for bigger things. Some say he may be the next Attorney General. In case you’ve forgotten, Rod Rosenstein is not the Attorney General, he’s the Deputy AG.

His boss is Mr. Jeff Sessions, an elusive figure for months now in the malarial DC backwaters, like that Louisiana Swamp Thang that turns up in the fake Bigfoot documentaries, looming hairily through the night-vision goggles in a cypress slough. Maybe three or four people have laid eyes on him since sometime back in April. Better check his office, make sure he isn’t hunched over face-down in a take-out order of tonkatsu ramen. It’s rumored that our president, the Golden Golem of Greatness, can, shall we say, put the Department of Justice and its subsidiary, the FBI, out of their current misery by finally firing a few of these conniving top dawgs. Order Rosenstein to release un-redacted files he’s been sitting on for a year, and fire his ass for cause when he refuses. In the case of Mr. Sessions, for Godsake, call the undertaker.

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Yogurt and whiskey.

Canada Hits US With Retaliatory Tariffs: ‘We Will Not Back Down’ (G.)

Canada has announced billions of dollars in retaliatory tariffs against the US in a tit-for-tat response to the Trump administration’s duties on Canadian steel and aluminum. Justin Trudeau’s government released the final list of items that will be targeted beginning 1 July. Some items will be subject to taxes of 10 or 25%. “We will not escalate and we will not back down,” the Canadian foreign minister, Chrystia Freeland, said. The taxes on items including ketchup, lawnmowers and motorboats amount to $12.6bn. “This is a perfectly reciprocal action,” Freeland said. “It is a dollar-for-dollar response.” Freeland said they had no other choice and called the tariffs regrettable.

Many of the US products were chosen for their political rather than economic impact. For example, imports just $3m worth of yoghurt from the US annually and most of it comes from one plant in Wisconsin, the home state of the House speaker, Paul Ryan. The product will now be hit with a 10% duty. Another product on the list is whiskey, which comes from Tennessee and Kentucky, the latter of which is the home state of the Republican Senate leader, Mitch McConnell. Freeland also said they are prepared if Donald Trump, the US president, escalates the trade war. “It is absolutely imperative that common sense should prevail,” she said. “Having said that, our approach from day one of the Nafta negotiations has been to hope for the best but prepare for the worst.”

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How much money is on the line, Angela?

Merkel Confirms Bilateral Migrant Agreements With Spain And Greece (DW)

Spain and Greece have agreed to take back asylum seekers already registered in those countries who are intercepted at the Austria-German border, Chancellor Angela Merkel confirmed on Friday. However she said no bilateral agreement had been made with Italy. The agreements are temporary measures to stem secondary migration until EU-wide policies take effect. “What we achieved here together is perhaps more than I had expected,” Merkel told reporters at the end of the summit. Merkel is to inform her coalition allies about the agreement on Friday evening.

Merkel was asked if the agreements with Athens and Madrid met demands from her German conservative CSU coalition partners. Merkel told reporters she believed they even surpassed them: “They are more than equivalent in their effect,” she said. “We are not at the end of the road. I always said that we would never be able to agree a common European asylum system here. But the more we agree among ourselves, the closer we get to a possible European solution. I’m convinced of that.” The tentative agreement with Greece and Spain came on the sidelines of an EU leaders’ summit that reached a breakthrough on migration. It will go into effect once operational details are worked out in the next four weeks, the Chancellery said.

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Does Ecuador have a spine?

Not Up To US To Decide On Assange Asylum, Ecuador Says (AFP)

It’s not up to Washington to decide the fate of WikiLeaks founder Julian Assange, Ecuador’s top diplomat said Friday, following the visit of US Vice President Mike Pence. Pence “raised the issue” of the Australian anti-secrecy activist – holed up at Ecuador’s embassy in London since 2012 – when he met with Lenin Moreno on Thursday, an official with the US vice president’s office confirmed. “Ecuador and the United Kingdom, and of course Mr Assange as a person who is currently staying, on asylum, at our embassy” will decide the next steps, Foreign Minister Jose Valencia told reporters. “It does not enter, therefore, on an agenda with the United States.” Pence and Moreno “agreed to remain in close coordination on potential next steps going forward,” the US official told reporters traveling with Pence.

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Snowden sure has a spine.

Edward Snowden Calls Russian Government ‘Corrupt’ (Ind.)

Edward Snowden, who fled to Russia after releasing thousands of documents from the US National Security Agency, has suggested his current homeland’s government is “corrupt in many ways”. The ex-IT contractor and Central Intelligence Agency (CIA) worker, said the country’s citizen’s were warm and clever but he “strongly” disagreed with the policies of Russian president Vladimir Putin. “I think the public feels disempowered. Russians are not naive, they know that state TV is unreliable. The Russian government is corrupt in many ways, that’s something the Russian people realise,” the 35-year-old told German newspaper Suddeutsche Zeitung. “Russian people are warm, they are clever. It’s a beautiful country. Their government is the problem not the people.”

Mr Snowden was granted asylum in Russia after his flight from the US when he made public the NSA’s widespread undeclared surveillance in 2013. He faces three charges under the Espionage Act in his homeland, each of which carry a minimum of 10 years in jail. He has been granted permission to stay in Russia until 2020. Asked by the Suddeutsche Zeitung whether his comments could put him in danger by angering Mr Putin, Mr Snowden said: “There’s no question, it’s a risk. Maybe they don’t care, right? Because I don’t speak Russian. “And I am literally a former CIA agent, so it’s very easy for them to discredit my political opinions as those of an American CIA agent in Russia.”

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Thought control.

The Great Firewall Of China (G.)

In December 2015, thousands of tech entrepreneurs and analysts, along with a few international heads of state, gathered in Wuzhen, in southern China, for the country’s second World Internet Conference. At the opening ceremony the Chinese president, Xi Jinping, set out his vision for the future of China’s internet. “We should respect the right of individual countries to independently choose their own path of cyber-development,” said Xi, warning against foreign interference “in other countries’ internal affairs”. No one was surprised by what they heard. Xi had already established that the Chinese internet would be a world unto itself, with its content closely monitored and managed by the Communist party.

In recent years, the Chinese leadership has devoted more and more resources to controlling content online. Government policies have contributed to a dramatic fall in the number of postings on the Chinese blogging platform Sina Weibo (similar to Twitter), and have silenced many of China’s most important voices advocating reform and opening up the internet. It wasn’t always like this. In the years before Xi became president in 2012, the internet had begun to afford the Chinese people an unprecedented level of transparency and power to communicate. Popular bloggers, some of whom advocated bold social and political reforms, commanded tens of millions of followers.

Chinese citizens used virtual private networks (VPNs) to access blocked websites. Citizens banded together online to hold authorities accountable for their actions, through virtual petitions and organising physical protests. In 2010, a survey of 300 Chinese officials revealed that 70% were anxious about whether mistakes or details about their private life might be leaked online. Of the almost 6,000 Chinese citizens also surveyed, 88% believed it was good for officials to feel this anxiety.

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