Sep 202018
 
 September 20, 2018  Posted by at 9:02 am Finance Tagged with: , , , , , , , , , , ,  


M. C. Escher Still life and street 1937

 

FBI, DOJ To Defy Trump Declassification Order (ZH)
Louisiana AG Jeff Landry Wants To Break Up Social Media Giants (Advocate)
Amazon Hit By EU Antitrust Probe (CNBC)
Facebook Building A ‘War Room’ To Battle Election Meddling (AFP)
Leave No Dark Corner: China Is Building A Digital Dictatorship (ABC.au)
Steve Keen Says U.S. Heading for 2020 Recession (BBG)
Digging into Wealth and Income Inequality (CHS)
Theresa May Tells EU27 She Won’t Delay Brexit Despite Lack Of A Deal (G.)
‘Seven In 10’ EU Workers In UK Would Be Barred Under Brexit Proposals (G.)
The Forgotten History of the Financial Crisis (Tooze)
Turkish Treasury Borrows $347 Million At 25% Interest Rate (Hu.)
US Officials Face Growing Pressure Over Dicamba Herbicide Use (AFP)

 

 

We’re getting real close to core constitutional issues now.

FBI, DOJ To Defy Trump Declassification Order (ZH)

Despite President Trump’s Monday order for the “immediate declassification” of sensitive materials related to the Russia investigation, “without redaction,” the agencies involved are planning to do so anyway, according to Bloomberg, citing three people familiar with the matter. “The Justice Department, FBI and Office of the Director of National Intelligence are going through a methodical review and can’t offer a timeline for finishing, said the people, who weren’t authorized to speak publicly about the sensitive matter.” -Bloomberg. Trump ordered the DOJ to release the text messages of former FBI Director James Comey, his deputy Andrew McCabe, now-fired special agent Peter Strzok, former FBI attorney Lisa Page and twice-demoted DOJ official Bruce Ohr.

Also ordered released are specific pages from the FBI’s FISA surveillance warrant application on former Trump campaign aide Carter Page, as well as interviews with Ohr. The DOJ and the FBI are expected to submit proposed redactions to the Office of the Director of National Intelligence – which will prepare a package for Trump to sign off on. “When the president issues such an order, it triggers a declassification review process that is conducted by various agencies within the intelligence community, in conjunction with the White House counsel, to seek to ensure the safety of America’s national security interests,” a Justice Department spokesman said in a statement. “The department and the Federal Bureau of Investigation are already working with the Director of National Intelligence to comply with the president’s order.”

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Ahead of a meeting with Jeff Sessions.

Louisiana AG Jeff Landry Wants To Break Up Social Media Giants (Advocate)

Louisiana Attorney General Jeff Landry would like to see Google, Facebook and other major social media behemoths broken up like the federal government did to Standard Oil more than a century ago. Landry says the internet giants are suppressing conservative agendas, stifling competition, and infringing on antitrust laws. “This can’t be fixed legislatively,” Landry told The Advocate Tuesday. “We need to go to court with an antitrust suit.” Landry – or Chief Deputy Attorney General Bill Stiles – will go to Washington, D.C. next week to push that solution to U.S. Attorney General Jeff Sessions. Sessions, who is considering an investigation against the social media companies, set a Sept. 25 meeting with about a half dozen Republican state attorney generals.

[..] “The U.S. Department of Justice weighing in absolutely gives us an edge … their participation accelerates the timeline,” Landry said. The federal lawyers have the funding, experience and expertise that states can’t match when handling such complex litigation. “I thought it would be years to get this going,” Landry said. “This moves up the timeline.” He is against the idea, at first blush, of letting the companies settle for some huge sum and promises to behave better in the future – a frequent outcome of anti-trust lawsuits, Landry said. “I’m not prepared to say what the exact remedy would look like,” Landry said. But his gut feel is “that breaking up the monopoly is a good idea.”

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“Vestager has the power to fine companies up to 10 percent of their global turnover..”

Amazon Hit By EU Antitrust Probe (CNBC)

The EU regulators behind a $5 billion fine against Google are turning their attentions to Amazon. European Competition Commissioner Margrethe Vestager has begun questioning merchants on Amazon’s use of their data, Vestager said Wednesday. The issue, she said, is whether Amazon is using data from the merchants it hosts on its site to secure an advantage in selling products against those same retailers. “These are very early days and we haven’t formally opened a case. We are trying to make sure that we get the full picture,” Vestager said during a news conference Wednesday.

The probe comes as the world’s largest online retailer faces growing calls for regulation. Investors and insiders have long cited Amazon’s size and reach as reason to break the company up. President Donald Trump has hinted at antitrust action against Amazon as part of continued attacks against CEO Jeff Bezos, who also owns The Washington Post. U.S. Attorney General Jeff Sessions was set to meet this month with state officials to discuss antitrust concerns in Silicon Valley, though much of the regulation on Big Tech thus far has come out of Brussels. Vestager has the power to fine companies up to 10 percent of their global turnover for breaching EU antitrust rules. Earlier this year, she levied a record $5 billion fine against Google related to its Android business.

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You mean, by the FBI and CIA?

Facebook Building A ‘War Room’ To Battle Election Meddling (AFP)

Facebook on Wednesday said it will have a “war room” up and running on its Silicon Valley campus to quickly repel efforts to use the social network to meddle in upcoming elections. “We are setting up a war room in Menlo Park for the Brazil and US elections,” Facebook elections and civic engagement director Samidh Chakrabarti said during a conference call. “It is going to serve as a command center so we can make real-time decisions as needed.” He declined to say when the “war room” — currently a conference room with a paper sign taped to the door — would be in operation.

Teams at Facebook have been honing responses to potential scenarios such as floods of bogus news or campaigns to trick people into falsely thinking they can cast ballots by text message, according to executives. “Preventing election interference on Facebook has been one of the biggest cross-team efforts the company has seen,” Chakrabarti said. The conference call was the latest briefing by Facebook regarding efforts to prevent the kinds of voter manipulation or outright deception that took place ahead of the 2016 election the brought US President Donald Trump to office.

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What social media tech can lead to. If they do it in China, what would keep them from doing it here?

Leave No Dark Corner: China Is Building A Digital Dictatorship (ABC.au)

What may sound like a dystopian vision of the future is already happening in China. And it’s making and breaking lives. The Communist Party calls it “social credit” and says it will be fully operational by 2020. Within years, an official Party outline claims, it will “allow the trustworthy to roam freely under heaven while making it hard for the discredited to take a single step”. Social credit is like a personal scorecard for each of China’s 1.4 billion citizens. In one pilot program already in place, each citizen has been assigned a score out of 800. In other programs it’s 900. Those, like Dandan, with top “citizen scores” get VIP treatment at hotels and airports, cheap loans and a fast track to the best universities and jobs.

Those at the bottom can be locked out of society and banned from travel, or barred from getting credit or government jobs. The system will be enforced by the latest in high-tech surveillance systems as China pushes to become the world leader in artificial intelligence. Surveillance cameras will be equipped with facial recognition, body scanning and geo-tracking to cast a constant gaze over every citizen. Smartphone apps will also be used to collect data and monitor online behaviour on a day-to-day basis. Then, big data from more traditional sources like government records, including educational and medical, state security assessments and financial records, will be fed into individual scores.

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The link doesn’t go to an article about the interview, but it’s what Bloomberg provided on Twitter.

Steve Keen Says U.S. Heading for 2020 Recession (BBG)

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Inequality CAN bring down societies.

Digging into Wealth and Income Inequality (CHS)

The assets of U.S. households recently topped $100 trillion, yet another sign that everything is going swimmingly in the U.S. economy. Let’s take a look at the Federal Reserve’s Household Balance Sheet, which lists the assets and liabilities of all U.S. households in very big buckets (real estate: $25 trillion). (For reasons unknown, the Fed lumps non-profit assets and liabilities with households, but these modest sums are easily subtracted.) If we look at the numbers with a reasonably skeptical view, we start wondering about aspects that might have previously been taken as “facts” that were above questioning. For example, households hold $11.6 trillion in cash (deposits). That’s unambiguous.

So is the $29.3 trillion in stocks (owned directly and indirectly, i.e. retirement funds, etc.). But what about the $16 trillion in “other financial assets”? This isn’t cash, stocks, bonds, retirement funds or noncorporate businesses–then what is it? Offshore banking? That $16 trillion is equal to all homeowners’ equity (real estate minus mortgages). It’s a non-trivial chunk of the $100 trillion in net assets everyone is crowing about. I also wonder about the valuation of noncorporate businesses–small family businesses, LLCs, sole proprietorships, etc.– $11.9 trillion. How do you value a business that’s hanging on by a thread? Or one that’s a tax shelter?

We know from other sources that roughly 85% of all this wealth is held by the top 10% of households. This isn’t included in this balance sheet, but without those statistics, these numbers lack critical context: if household wealth is soaring, that sounds wonderful. But what if 95% the gains are flowing to the top 5%, and within the top 5%, mostly to the top .1%?

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Like she’s in a position to issue ultimatums.

Theresa May Tells EU27 She Won’t Delay Brexit Despite Lack Of A Deal (G.)

Theresa May has tried to threaten EU leaders over dinner at a special summit in Salzburg by telling them the UK would not seek to delay Brexit, prompting European leaders to warn that the two sides remained far apart on trade and the Irish border despite months of negotiations. The prime minister told her counterparts “that the UK will leave on 29 March next year” and as a result “the onus is now on all of us to get this deal done” by the end of an emergency summit that the EU confirmed would happen in mid-November. It was the first time since Chequers that May has had a chance to address the EU’s other 27 heads of government instead of going through their chief negotiator, Michel Barnier, with No 10 hoping that it would inject some urgency into the divorce talks.

“We all recognise that time is short but extending or delaying these negotiations is not an option,” she said. But as the summit started Jean-Claude Juncker, the president of the European commission, said that a deal remained “far away” while Donald Tusk, the president of the European council, warned that the UK’s proposals for the Irish border and future trade relations with the EU needed to be “reworked and further negotiated”. Tusk added that “various scenarios are still possible” – a clear hint that no deal was still a possibility. Despite the EU leaders’ statements, No 10 is hoping that May’s pitch to EU leaders will eventually prompt some greater flexibility on the part of Brussels in the critical period for the Brexit negotiations between a scheduled European council meeting in October and the decisive summit in November.

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No berries for you next summer.

‘Seven In 10’ EU Workers In UK Would Be Barred Under Brexit Proposals (G.)

The majority of EU workers in the UK would not be eligible to work in the country following Brexit if they were subject to proposals put forward by the government’s chief migration advisers, analysis by a leading leftwing thinktank shows. EU citizens currently in the UK are expected to be protected under the terms of the UK-EU withdrawal agreement but findings by the Institute for Public Policy Research (IPPR) illustrate how proposals by the Migration Advisory Committee (MAC) will potentially restrict businesses recruiting migrants from the EU in future.

In its report on EU migration after Brexit, published on Tuesday, the committee recommended lifting the cap on highly skilled workers applying to take up jobs in the UK but also backed maintaining the salary threshold of £30,000. The committee also recommended only allowing in individuals at level three or above on the nine-level regulated qualifications framework (RQF). Comparing this criteria to data from the labour force survey, the IPPR estimates that around 75% of the UK’s current EU workforce would not be eligible were they subject to the proposals. The findings will likely enflame concerns from business leaders over proposals they have already branded “ignorant and elitist”.

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Long overview by Adam Tooze.

The Forgotten History of the Financial Crisis (Tooze)

Although more banks failed during the Depression, these failures were scattered between 1929 and 1933 and involved far smaller balance sheets. In 2008, both the scale and the speed of the implosion were breathtaking. According to data from the Bank for International Settlements, gross capital flows around the world plunged by 90 percent between 2007 and 2008. As capital flows dried up, the crisis soon morphed into a crushing recession in the real economy. The “great trade collapse” of 2008 was the most severe synchronized contraction in international trade ever recorded.

Within nine months of their pre-crisis peak, in April 2008, global exports were down by 22 percent. (During the Great Depression, it took nearly two years for trade to slump by a similar amount.) In the United States between late 2008 and early 2009, 800,000 people were losing their jobs every month. By 2015, over nine million American families would lose their homes to foreclosure—the largest forced population movement in the United States since the Dust Bowl. In Europe, meanwhile, failing banks and fragile public finances created a crisis that nearly split the eurozone.

[..] bankers on both sides of the Atlantic created the system that imploded in 2008. The collapse could easily have devastated both the U.S. and the European economies had it not been for improvisation on the part of U.S. officials at the Federal Reserve, who leveraged trans-atlantic connections they had inherited from the twentieth century to stop the global bank run. That this reality has been obscured speaks both to the contentious politics of managing global finances and to the growing distance between the United States and Europe. More important, it forces a question about the future of financial globalization: How will a multipolar world that has moved beyond the transatlantic structures of the last century cope with the next crisis?

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Wow.

Turkish Treasury Borrows $347 Million At 25% Interest Rate (Hu.)

The Turkish Treasury borrowed some 2.2 billion Turkish liras (around $347 million) from domestic markets, the Treasury and Finance Ministry announced on Sept. 18. The auction was held for 12-month zero coupon bonds – new issuance – to be settled on Sept. 19 and mature on Sept. 18, 2019, according to an official statement. The average annual simple and compound interest rates of the 364-day bonds were 25.05 percent, the ministry added. According to the domestic borrowing strategy, the ministry has projected 21.9 billion liras (around $3.4 billion) of borrowing from the market through auctions in the September-November period. Sept. 18’s auction was second out of a total 11 planned auctions on the ministry’s issuance calendar for the three-month period.

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“Controversial pesticide pits farmer vs farmer in US.” Can we perhaps just stop using poison to produce food?

US Officials Face Growing Pressure Over Dicamba Herbicide Use (AFP)

US environmental regulators are under increasing pressure over a controversial pesticide known for laying waste to nearby crops as well as the harmful weeds it is meant to control. Critics worried about the harm are calling for increased restrictions, following the example of many states, while producers and some farmers want fewer obstacles to use of a chemical they view as one of their last options. Much like Roundup, another much-criticized herbicide marketed by Monsanto, dicamba has been on the market a long time. But use of the chemical has jumped since Monsanto – which was bought by Germany’s Bayer in June – introduced seeds that can resist the weed-killer.

Dicamba has been a boon for farmers at a time when they have seen other leading herbicides lose their effectiveness and the battle against damaging weeds. Use of seeds resistant to dicamba doubled over the last year, reaching 20 million hectares (50 million acres) this summer. But the product has been blamed for polluting around four percent of US soybean fields in 2017. A common complaint is that the herbicide is volatile, meaning it spreads to nearby areas. It is only meant for use during the growing season for plants resistant to the chemical, and the US Environmental Protection Agency last year received reports of “significant crop damage from off-field movement of dicamba.” The EPA authorized use of the weed-killer for two years, through November, so it will soon need to announce any changes to the rules on when and how it can be used.

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Sep 112018
 
 September 11, 2018  Posted by at 9:16 am Finance Tagged with: , , , , , , , , , , ,  


Claude Monet The Manneporte at Étretat 1886

 

 

Please Note: The mailing lists I’ve used for many years all of a sudden stopped working. This appears to be because there is some sort of discrepancy between Gmail and Apple Mail. I’ve lost all access to one Gmail account in Apple Mail, though it still works in a browser. Two other Gmail accounts still function in Apple Mail, but bounce back all mails sent as part of the mailing lists. Working on a solution.

Ilargi

 

 

 

America’s Sub-4% Unemployment Rate Means A Recession Is Not Far Off (Colombo)
Mass Evacuations Ordered As Hurricane Florence Heads Toward Carolinas (R.)
EU’s Barnier Says Brexit Deal Still ‘Realistic’ As Deadline Looms (Ind.)
Three-Bagger (Jim Kunstler)
Kim Jong Un Asks Trump For Another Meeting In ‘Very Warm’ Letter (R.)
US Threatens To Arrest ICC Judges Who Probe War Crimes (AFP)
Moscow Has Upped the Ante in Syria (VIPS)
Netherlands Ends Support To Syrian Militants & White Helmets (RT)
Catalan Separatists Plan Mass Rally Tuesday For Independence From Spain (R.)
Creditors Warn Greece On Debt Relief As Inspectors Return (AP)
Greece’s Moria Migrant Camp Faces Closure Over Living Conditions (K.)
US Teens Prefer Remote Chats To Face-to-Face Meeting (AFP)

 

 

Not all that glitters is gold.

America’s Sub-4% Unemployment Rate Means A Recession Is Not Far Off (Colombo)

The strong job market has become a reason for optimism for many Americans in the past couple years in stark contrast to the dark days of the Great Recession and the ensuing “jobless recovery.” The unemployment rate fell beneath 4% for the past several months, weekly jobless claims are at a 49-year low, and wages are growing at their fastest rate since 2009. So, what’s not to like? Obviously, everyone likes good news on the economic front, but these strong job market statistics are a sign that the economic cycle is much closer to the end (including a recession and bear market) rather than the beginning. As the chart below shows, when the U.S. unemployment rate falls under 4%, recessions follow soon after (recessions are marked by the gray shaded areas on the chart).

Historically, U.S. unemployment under 4% is quite rare and typically occurs after a long, powerful economic expansion. By the time the unemployment rate is under 4%, the economic cycle is already mature, the labor market is tight, and inflation is becoming a concern. At this time, the Federal Reserve has been hiking interest rates steadily, which eventually causes the demise of the economic cycle. According to Nicole Smith, chief economist at the Georgetown University Center on Education and the Workforce: “The 4 percent number is not exactly a number that economists are necessarily happy with.” “What’s been happening here is, if we look historically at other times when the unemployment rate has fallen below 4 percent, it’s times where it was the boom phase just before recession or just after a major war period.”

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Florence is dangerous. Get out of the way.

Mass Evacuations Ordered As Hurricane Florence Heads Toward Carolinas (R.)

Mass evacuations were ordered along the U.S. Atlantic Coast as Hurricane Florence, a Category 4 storm and the most powerful to menace the region in nearly three decades, barreled toward the region on Tuesday. Governor Ralph Northam issued an evacuation order for about 245,000 residents in flood-prone coastal Virginia beginning at 8 a.m. local time while South Carolina Governor Henry McMaster has ordered more than 1 million residents along his state’s coastline to leave starting at noon on Tuesday. “This is a serious storm and it’s going to effect the entire state,” Northam told a news conference. “Everyone in Virginia needs to prepare.”

Florence, packing winds of 140 miles per hour (220 kph), was expected to grow even stronger before making landfall on Thursday, mostly likely in southeastern North Carolina near the South Carolina border, the National Hurricane Center in Miami said. North Carolina Governor Roy Cooper told a news conference his state was in “the bull’s eye.” At least 250,000 more people were due to be evacuated from the northern Outer Banks in North Carolina on Tuesday after more than 50,000 people were ordered on Monday to leave Hatteras and Ocracoke, the southernmost of the state’s barrier islands.

North Carolina, South Carolina, Virginia and Maryland governors have declared states of emergency. Authorities warned of life-threatening coastal storm surges and the potential for Florence to unleash prolonged torrential rains and widespread flooding, especially if it lingers inland for several days. NHC Director Ken Graham warned of “staggering” amounts of rainfall that may extend hundreds of miles inland and cause flash flooding across the mid-Atlantic region.

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If the UK change their positions, that is.

EU’s Barnier Says Brexit Deal Still ‘Realistic’ As Deadline Looms (Ind.)

It is “realistic” to believe Britain and the EU will sign a Brexit withdrawal agreement before the looming deadline, Michel Barnier has said. Speaking at the Bled Strategic Forum conference in Slovenia the EU’s chief negotiator said a deal was “possible” in the next six to eight weeks – the cutoff date set for talks. The pound jumped by nearly 1 per cent against the dollar on the foreign exchange markets following the comments, after traders apparently over-interpreted the official’s words. “If we are realistic, I want to reach an agreement on the first stage of the negotiation, which is the Brexit treaty, within six or eight weeks,” Mr Barnier said.

He added: “The treaty is clear, we have two years to reach an agreement before they leave… in March 2019. “That means that taking into account the time necessary for the ratification process in the House of Commons on one side, the European Parliament and the Council on the other side, we must reach an agreement before the beginning of November. I think it is possible.” The episode comes around a week after jumpy financial markets also boosted the pound after Mr Barnier repeated his mantra about wanting to do an ambitious and unique trade deal with the UK. Though little has changed on the ground, both sides of talks are staying publicly positive – if only to give them the upper hand in any ensuing blame game that follows a no deal.

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“..a cast of rogue spooks from the CIA, various FBI officers, and British Intelligence in a scheme that is now going to grand juries.”

Three-Bagger (Jim Kunstler)

The likely confirmation of Brett Kavanaugh may be a last straw for the “Resistance.” It would certainly affect the adjudication of any new disputes that arise over relations between Mr. Trump and Special Counsel Robert Mueller in the weeks ahead. The Mueller investigation into 2016 election “collusion” between Russia and Trump looks more and more like a case of displacement-projection syndrome, since dumpster-loads of evidence now point to collusion between the Hillary campaign, the DNC, a cast of rogue spooks from the CIA, various FBI officers, and British Intelligence in a scheme that is now going to grand juries.

All that nasty business, starting with the news that a grand jury has been secretly grilling former FBI Deputy Director Andrew McCabe for weeks, suggests that events are about to unspool dramatically. The story has been coiling for months as fresh documents emerge and officials, such as the DOJ Inspector General, confirm what they mean. It remains to be seen whether the Web chatter about dozens of “sealed indictments” coming down is horse-shit. The baffling part is the role of Attorney General Jeff Sessions. I’m inclined to doubt that Mr. Trump’s regular vilifications of Sessions are a ruse, meant to mislead the media about the AG’s activities in these matters. But the DC Swamp is unnerved by Sessions’ extraordinary absence of presence on the scene. Has he actually been involved in any of this, or is he playing animal lotto on his desk?

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The Korea’s want peace and unison. Let nobody put a loophole, a loophole in their way.

Kim Jong Un Asks Trump For Another Meeting In ‘Very Warm’ Letter (R.)

U.S. President Donald Trump received a “very warm, very positive” letter from North Korean leader Kim Jong Un asking for a second meeting and the White House is looking at scheduling one, White House spokeswoman Sarah Sanders said on Monday. The two countries have been discussing North Korea’s nuclear programs since their leaders met in Singapore in June, although that summit’s outcome was criticized for being short on concrete details about how and whether Kim is willing to give up weapons that threaten the United States. The likely timing of a second Trump-Kim meeting was unclear.

South Korea’s President Moon Jae-in is scheduled to have his third summit with Kim next week in Pyongyang, and his government had pushed for a three-way summit involving Trump, with the aim of agreeing a joint declaration to end the 1950-53 Korean War. The conflict ended with an armistice, not a peace treaty, leaving the U.S.-led United Nations forces including South Korea technically still at war with North Korea. While South Korea had hoped an accord formally ending the conflict could have been unveiled on the sidelines of the U.N. General Assembly later this month, Moon’s security chief Chung Eui-yong said last week, without elaborating, that the necessary conditions for a three-way meeting were missing.

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The ICC was only ever meant to go after Arican dictators fallen out of favor with the west. Bolton protects himself and his ilk.

US Threatens To Arrest ICC Judges Who Probe War Crimes (AFP)

The United States threatened Monday to arrest and sanction judges and other officials of the International Criminal Court if it moves to charge any American who served in Afghanistan with war crimes. White House National Security Advisor John Bolton called the Hague-based rights body “unaccountable” and “outright dangerous” to the United States, Israel and other allies, and said any probe of US service members would be “an utterly unfounded, unjustifiable investigation.” “If the court comes after us, Israel or other US allies, we will not sit quietly,” Bolton said. He said the US was prepared to slap financial sanctions and criminal charges on officials of the court if they proceed against any Americans.

“We will ban its judges and prosecutors from entering the United States. We will sanction their funds in the US financial system, and we will prosecute them in the US criminal system,” Bolton said. “We will do the same for any company or state that assists an ICC investigation of Americans.” Bolton made the comments in a speech in Washington to the Federalist Society, a powerful association of legal conservatives. Bolton pointed to an ICC prosecutor’s request in November 2017 to open an investigation into alleged war crimes committed by the US military and intelligence officials in Afghanistan, especially over the abuse of detainees. [..] He also cited a recent move by Palestinian leaders to have Israeli officials prosecuted at the ICC for human rights violations.

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Veteran Intelligence Professionals for Sanity (VIPS) is made up of former intelligence officers, diplomats, military officers and congressional staffers.

Moscow Has Upped the Ante in Syria (VIPS)

Mr. President:

We are concerned that you may not have been adequately briefed on the upsurge of hostilities in northwestern Syria, where Syrian armed forces with Russian support have launched a full-out campaign to take back the al-Nusra/al-Qaeda/ISIS-infested province of Idlib. The Syrians will almost certainly succeed, as they did in late 2016 in Aleppo. As in Aleppo, it will mean unspeakable carnage, unless someone finally tells the insurgents theirs is a lost cause. That someone is you. The Israelis, Saudis, and others who want unrest to endure are egging on the insurgents, assuring them that you, Mr. President, will use US forces to protect the insurgents in Idlib, and perhaps also rain hell down on Damascus.

We believe that your senior advisers are encouraging the insurgents to think in those terms, and that your most senior aides are taking credit for your recent policy shift from troop withdrawal from Syria to indefinite war. Russian missile-armed naval and air units are now deployed in unprecedented numbers to engage those tempted to interfere with Syrian and Russian forces trying to clean out the terrorists from Idlib. We assume you have been briefed on that — at least to some extent. More important, we know that your advisers tend to be dangerously dismissive of Russian capabilities and intentions. We do not want you to be surprised when the Russians start firing their missiles.

The prospect of direct Russian-U.S. hostilities in Syria is at an all-time high. We are not sure you realize that. The situation is even more volatile because Kremlin leaders are not sure who is calling the shots in Washington. This is not the first time that President Putin has encountered such uncertainty . This is, however, the first time that Russian forces have deployed in such numbers into the area, ready to do battle. The stakes are very high. We hope that John Bolton has given you an accurate description of his acerbic talks with his Russian counterpart in Geneva a few weeks ago. In our view, it is a safe bet that the Kremlin is uncertain whether Bolton faithfully speaks in your stead, or speaks INSTEAD of you.

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A government spending million to support what it itself has labeled ‘terrorists’. We’re not even surprised. Standard fare in the west.

Netherlands Ends Support To Syrian Militants & White Helmets (RT)

The Netherlands has decided to end its support to militants in Syria, since the program did not yield “expected” results. The move comes as journalists found one of the groups had been labeled as terrorists by the country itself. “The opportunity to quickly change the situation [in Syria] is extremely small,” reads the letter the lower house of the parliament by Dutch Foreign Minister Stef Blok and Minister for Foreign Trade Sigrid Kaag, announcing the end of support programs for the militants in Syria. The program to support of “moderate” anti-government groups in Syria was established in close cooperation with “like-minded donors who pursued the same goals as the Netherlands” and cost the country over $80 million over the years, according to the document.

It failed to “bring the expected results,” however, and is to be closed since the Syrian troops “will soon win” the war against militant groups. Over the years, the Netherlands allocated $29 million to the so-called “non-lethal assistance” (NLA) program, $14.5 million were donated to the so-called White Helmets and $17.1 million went to the Access to Justice and Community Service (AJACS) program. The AJACS was supposedly designed to support “community police” work in Syria, specifically the so-called Free Syrian Police (FSP) group. The support for militants is set to end immediately, yet the White Helmets will be funded until December, according to the document.

Since the White Helmets now operate only in the Idlib province, which is believed to be the destination of the looming offensive by the Syrian Army and its allies, their future is quite doubtful, the document states. [..] The “non-lethal” goods supplied by the Dutch government included satellite phones, uniforms, assorted equipment and even the ‘iconic’ Toyota Hilux pick-up trucks, widely used by various militant groups in Syria. At least one of the groups supplied by the Netherlands, Jabhat al-Shamiya, turned out to be labeled a terrorist group by the country’s own justice department, the journalists have revealed. One Dutch man is currently prosecuted for joining the group back in 2015, with the indictment describing it as a “salafist and jihadist” movement which can qualify only as a “criminal organization with terrorist intent.”

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What year is it?

Catalan Separatists Plan Mass Rally Tuesday For Independence From Spain (R.)

Hundreds of thousands of Catalans are expected to fill the streets of Barcelona on Tuesday for the Spanish region’s first commemorative day since its leader declared independence last year and pitched the country into constitutional crisis. Supporters of splitting the wealthy northeastern region from the rest of Spain have in recent years used the Sept. 11 “Diada”, the anniversary of the fall of their coastal capital to Spanish forces in 1714, to promote the cause. This year, Catalonia’s leader Quim Torra, who took over from his exiled predecessor after Madrid ended an unprecedented period of direct rule, has called for a mass rally in support of his bid for a binding referendum on independence.

“Our government has committed to making the republic a reality,” Torra said in a televised address to mark the occasion. “I wish you all a very good Diada. Long live free Catalonia.” He wore a yellow ribbon signifying support for nine politicians whose jailing for their role in the independence bid is one of the Catalan government’s biggest grievances. Socialist Prime Minister Pedro Sanchez, who took power in June, has taken a softer approach to one of the thorniest issues in national politics than that of his conservative predecessor Mariano Rajoy, but he has stood firm against allowing a vote on secession, or any unilateral attempt by Catalonia to secede.

Last year’s Diada, in which marchers often climb on each other’s shoulders in shows of the traditional sport of forming human towers, fell as the regional government was preparing to hold a referendum in defiance of Madrid, which ultimately sent riot police to try to stop the vote.

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Sovereignty, 2018.

Creditors Warn Greece On Debt Relief As Inspectors Return (AP)

Greece’s lead creditor warned the country on Monday not to stray from reforms agreed upon before the end of its international bailout, as European monitors arrived to check the nation’s finances. The five-day inspection is expected to focus on government promises over the weekend to offer tax relief as well as plans to scrap promised pension cuts that are due to take effect in 2019. Klaus Regling, managing director of the European Stability Mechanism, the eurozone’s rescue fund, told Austria’s Die Presse newspaper that Greece’s needed to stick to its commitments. “We are a very patient creditor. But we can stop debt relief measures that have been decided for Greece if the adjustment programs are not continued as agreed,” he said.

“The debt level appears to be frighteningly elevated. But Greece can live with that as the loan maturities are very long and the interest rates on the loans are much lower than in most other countries.” Left-wing Prime Minister Alexis Tsipras is trailing opposition conservatives in opinion polls and must call a general election within the next 12 months. Amid large protest rallies led by labor unions over the weekend, the prime minister said that relief measures promised to taxpayers would not jeopardize fiscal performance targets and would be introduced gradually. Greece has promised to deliver high primary surpluses — the budget balance before calculating the cost of servicing debt — for years to come, along with a series of reforms in exchange for better debt repayment terms.

The end of the bailout means Greece will have to return to international capital markets to finance itself. However, the country faces a troubled return after the financial turmoil in Turkey and Italy halted a decline in Greek borrowing rates. The yield on Greece’s 10-year-bond remains above 4 percent. The bailout program ended Aug. 20 but the country’s debt level remains near 180 percent of gross domestic product.

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Let’s see what happens in the next 30 days.

Greece’s Moria Migrant Camp Faces Closure Over Living Conditions (K.)

The Regional Authority of the Northern Aegean has given the Ministry of Migration Policy 30 days to clean up the overcrowded Moria hot spot for migrants and refugees on the island of Lesvos, or face closure. The announcement is part of a report compiled by environmental and health inspectors from Lesvos’ public health directorate who found the camp is unsuitable and dangerous for public health and the environment. According to the report, inspectors said there is an uncontrolled wastewater spill at the entrance of the camp, which ends into an adjacent stream or even on the road.

In another section of the camp, toilet waste pipes are broken, resulting in a strong stench and creating a danger to public health. Inspectors said the overcrowding living conditions in Moria, in which up to 15 people are squeezed into the small houses and up to 150 in every tent, increases the risk of disease transmission. “There was also a strong stench and insects (flies) due to the inability to properly clean the living quarters,” the report added. North Aegean Regional Governor Christiana Kalogirou says the ministry will have to restore every damage or problem detailed in the report, otherwise the authority will forbid the hot spot’s operation.

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It’ll take years to assess the damage. And then it’ll be too late.

US Teens Prefer Remote Chats To Face-to-Face Meeting (AFP)

American teenagers are starting to prefer communicating via text instead of meeting face-to-face, according to a study published Monday by the independent organization Common Sense Media. Some 35% of kids aged 13 to 17 years old said they would rather send a text than meet up with people, which received 32%. The last time the media and technology-focused nonprofit conducted such a survey in 2012, meeting face-to-face hit 49%, far ahead of texting’s 33%. More than two-thirds of American teens choose remote communication — including texting, social media, video conversation and phone conversation — when they can, according to the study. In 2012 less than half of them marked a similar preference.

Notably, in the six-year span between the two studies the proportion of 13 to 17-year-olds with their own smartphone increased from 41 to 89%. As for social networks, 81% of respondents said online exchange is part of their lives, with 32% calling it “extremely” or “very” important. The most-used platform for this age group is Snapchat (63%), followed by Instagram (61%) and Facebook (43%). Some 54% of the teens who use social networks said it steals attention away from those in their physical presence. Two-fifths of them said time spent on social media prevents them from spending more time with friends in person. The study was conducted online with a sample of 1,141 young people ages 13 to 17, from March 22 to April 10.

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Aug 072018
 
 August 7, 2018  Posted by at 1:01 pm Primers Tagged with: , , , , , , , , ,  


Vasily Polenov Christ among the teachers (doctors) 1896

 

This morning I woke up, looked around me, and saw a world sinking into a quagmire of voluntary censorship, a world willing to let someone far away choose what it can and cannot see of itself, and about itself. A world that no longer appears to recognize, or care, that this goes directly against its founding principles of liberty, freedom of speech, freedom of the press.

I can think of many reasons why someone would want to ban Infowars and Alex Jones, and I don’t even know them other than from incidental tweets and comments. But I also acknowledge that that is not the point. Just because you would like to ban a person or organization, just because you don’t agree with them, doesn’t mean you can, or should be able to.

And if Facebook, Google, Apple, Spotify and Pinterest -all within hours of each other-, think it’s a good idea to ban Jones regardless, they had better do a lot better than saying something about violating their ‘community standards’. They should identify specific instances where these alleged violations take place, and identify them publicly.

You can’t ban anyone on vague ‘standards’ from media that cover half the planet. Because that’s a danger to the entire planet, and to all of mankind. As Facebook and Google are very busy lobbying Washington, Brussels et al to drop any anti-trust charges against them, and let them continue to be private enterprises, they are shirking ever close to the various intelligence communities.

Politicians and secret agents alike have long recognized the potential Big Tech offers for controlling their populations. Long before those populations themselves have recognized the danger embedded in this potential. The treatment of Julian Assange and Infowars, 180º different as they are, puts all this in very sharp perspective.

How are you going to be informed, and stay informed, of what’s happening in the world, of what your government does and plans, if your media, both old and new, conspire to let you know only what they want you to, and to present a version of the world, of reality, that they invented in order to safeguard their future and that of their sponsors? Who’s going to tell you what happens behind the infinite layers of curtains?

What is most important here is not who Alex Jones is, or what he’s done and said. What’s most important is that he stands up for Julian Assange as the media, across the board, is either silent or actively smearing Assange with impunity. So for once, go to Infowars and sign the petition to Trump to Free Assange.. If anyone can get through to Trump, it’s Alex Jones, and they’re trying to prevent him from doing just that.

 

You’re being sold out, your rights and freedoms are being sold out, while you’re busy looking at pictures of what your friends had for dinner last night. And if that’s your thing, fine, but not before and until you’ve checked what is happening to your life and liberty, and that of your children, while you’re watching the next photo of a creme brulée or some cute kitten 1000 miles away.

We all know these things. And we’re all overloaded on info, so we’re all tired and developing headaches in echo chambers, and cute kittens are so much easier to deal with than petitions. But pretty soon, if you’re not careful, kittens will be the only thing you’re allowed to look at. Kittens and ‘news’ about evil Russians allegedly plotting to do to you exactly what your own governments already, and actually, do right now.

In one word: you’re being brainwashed. Brainwashed into handing over the liberties your ancestors fought very hard, and often lost their lives, to obtain and guarantee in your constitution. You can’t just give those things away, you have no right to. You owe it to them to protect what they fought for. If and when your government, your House and Senate, refuse to do that, then you will have to do it.

And that starts with protecting and standing up for Julian Assange. You don’t get to pick and choose which part of freedom you would like to protect, you either protect the entire concept or you do not. Freedom doesn’t mean you get to chop freedom into bits and pieces. And if you fail to stand up for the part you don’t like, you also fail to protect what you do like.

 

You don’t get to cherrypick, And neither should Google, Apple, and Facebook. Check your constitution for that one. Sure, we get it, it’s hard to stand up for Alex Jones. But if he can get chucked out for violating opaque ‘community standards’ of some private enterprise, then so can you. Well, unless you only look at kittens and desserts. But is that what you want your life to look like going forward?

This is about a principle engraved in the Constitution, and not just the American one. And of course there would always be people trying to get rid of that principle, because it got in the way of their personal power and interests. But that’s exactly why it’s in the Constitution. So it can’t just be eradicated at whim.

New media, social media, have taken the world by storm, and everyone has to scramble to keep up and think about what this means. What it should never ever mean, though, is that some parties get to use the confusion in order to trample on the Constitution. But that is what’s happening today.

We’ll resolve this eventually. You can’t let companies that have half the world as their clients continue as private enterprises; there’s far too much in the way of monopoly and anti-trust law to allow that to continue. But as long as this is not solved, Google and Facebook will be used as political tools, even while their legal status, and that of their policies, will be increasingly questionable.

So, you know, standing up for Alex Jones today equals standing up for the Constitution. That is harder for people to understand than it is that calling for Julian Assange to be protected and freed is. But it is the same thing. This is proven more than anything by the fact that Jones gets shut down at the very moment he seeks to protect Assange.

Swallow your pride and your disapproval of Alex Jones. Sign the petition to Trump to Free Assange.. It’s much bigger than your pride, or whatever you happen to like or dislike. This is about your future. And the people in the past who gave their lives to make it what it is. Don’t give it away. Prove Orwell wrong.

That we must defend Alex Jones just to stand up for Julian Assange should be all you need to know. You can’t defend Assange without also defending Infowars’ right to speak. And if they say things that go against the Constitution, a bunch of geeks in Silicon Valley should never be the judges of that.

 

 

Jul 292018
 
 July 29, 2018  Posted by at 9:15 am Finance Tagged with: , , , , , , , , , ,  


Pablo Picasso The old guitarist 1903-4

 

What the GDP Report Won’t Tell You About the Economy (DDMB)
Julian Assange Looks For Deal To End ‘Diplomatic Isolation’ (CNN)
In Refusing To Defend Assange, Mainstream Media Exposes Its True Nature (CJ)
Round the Bend (Jim Kunstler)
David Cameron’s Welfare Cuts Led Directly To The Brexit Vote (Ind.)
An Open Letter to Bernie Sanders: ‘No Bernie, It Wasn’t the Russians’ (MPN)
Putin Calls Christianity Foundation Of Russian State (AP)
Ten Arguments for Deleting Your Social Media Accounts Right Now (Star)
Nature’s Darkness-Creature Has Become Ours, Too (G.)
Migrant Arrivals Push Shelters To Breaking Point In Southern Spain (El Pais)
Number Of Fatalities In Greek Wildfires Rises To 88 (K.)

 

 

GDP may look strong, but sentiments are crumbling.

What the GDP Report Won’t Tell You About the Economy (DDMB)

Something is amiss in Corporate America. Both national and regional surveys reveal a sinking sense that the economy’s tailwinds are shifting to headwinds. The downtrodden confidence is a curiosity given many economists’ forecasts calling for second-quarter growth to have accelerated to a 4.2 percent annualized rate, the fastest since 2014. Soft though the survey data may be, the numbers don’t lie. If something doesn’t give – and fast – what follows is sure to be damaging to the real economy. The University of Michigan consumer sentiment survey for July revealed that the business outlook had slumped to the lowest level in over two years.

Odds are pretty good this number was dragged down by those with the highest incomes, many of whom are likely also business owners and corporate executives who’ve been on the front line of the rising costs to run their businesses. But there may be more than meets the eye among those whose incomes rank in the top third of households. While the majority of these respondents expressed concern over the tariffs, what they’re reading, hearing and seeing may be dampening their outlooks even further. As things stand, it’s as if January never happened, a month in which confidence was so high, the “news heard” among high income earners hit a 20-year high. By the beginning of July, “news heard” had slid to minus 18, the lowest in two years.

The six-month, 79-point swing is so severe it rivals August 2011, when the euro crisis shook world markets, Standard & Poor’s stripped the U.S. of its AAA credit rating and households were rattled by the debt ceiling debacle. [..] Consider the starting point for many companies. Last year’s weak dollar and natural disasters had many struggling to satisfy overseas demands and the massive needs required to rebuild. Labor and raw material costs were already on the rise to correct for the imbalances. The tariffs were the insult to injury many manufacturers could simply not afford.

“The actual economic impact will really come down to time,” cautioned Boockvar. “The longer this goes on, the more actual business activity will be negatively affected.” To Boockvar’s point, the collapse in business sentiment suggests many companies don’t foresee the ability to withstand further blows to their ability to profitably conduct business. Businesses are saying as much.

Read more …

Unbelievable garbage from CNN. That they pay attention to Assange now may be a ominous sign. They straight-faced claim that Assange fled rape allegations in Sweden. He did not. Sweden told him he was free to go to London. Only to turn around and issue a warrant for him.

Julian Assange Looks For Deal To End ‘Diplomatic Isolation’ (CNN)

Julian Assange walked into the Ecuadorian Embassy in London on June 19, 2012 to claim political asylum. He has been there ever since – a total of 2,230 days – rarely seeing daylight. But multiple sources say his situation is now untenable and he may soon leave, whether he wants to or not. The question is: what will happen to Assange as and when he does walk out of his bolt-hole around the corner from Harrods? The recent indictments issued by US Special Counsel Robert Mueller imply that Assange and WikiLeaks were a conduit for Russian intelligence in distributing hacked Democratic Party emails in 2016. According to the indictment document, “The conspirators (…) discussed the release of the stolen documents and the timing of those releases with Organisation 1 to heighten their impact.”

Assange has always maintained that he did not receive them from the Russian government. He told Fox News in January 2017: “Our source is not the Russian government, and it is not a state party.” A member of Assange’s legal team, Jennifer Robinson, told CNN this week: “WikiLeaks has made very clear they were not engaged in any way with the Russian state with respect to that publication. There is no connection between WikiLeaks and any of those who have been indicted.” His lawyers argue that all Assange did was publish the hacked emails, as did other media, after being in contact with a hacker called Guccifer 2.0. The Special Counsel alleges that Guccifer 2.0 was a cover for Russian intelligence, saying in the indictment that on July 14th [2016], Guccifer 2.0 sent WikiLeaks an encrypted attachment that contained “instructions on how to access an online archive of stolen DNC documents.”

Whether a sealed indictment awaits Assange in relation to the Russian hacking investigation is unknown. But according to US officials, charges have been drawn up relating to previous WikiLeaks disclosures of classified US documents. Assange would face arrest if/when he leaves the embassy because he skipped bail in 2012 – when Swedish authorities were seeking his extradition to face accusations of rape. Last year Sweden suspended the investigation, but Assange’s lawyers fear his arrest would be swiftly followed by a US extradition request. Assange maintains his innocence.

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This feels like too little too late. We know all this, we have for a long time. And it’s worse: as I wrote in May in I am Julian Assange, the Guardian engaged in an active smear campaign against Assange then. So does CNN -see above. That’s much more relevant than that they don’t defend him.

In Refusing To Defend Assange, Mainstream Media Exposes Its True Nature (CJ)

Last Tuesday a top lawyer for the New York Times named David McCraw warned a room full of judges that the prosecution of Julian Assange for WikiLeaks publications would set a very dangerous precedent which would end up hurting mainstream news media outlets like NYT, the Washington Post, and other outlets which publish secret government documents. “I think the prosecution of him would be a very, very bad precedent for publishers,” McCraw said. “From that incident, from everything I know, he’s sort of in a classic publisher’s position and I think the law would have a very hard time drawing a distinction between The New York Times and WikiLeaks.” Do you know where I read about this? Not in the New York Times.

“Curiously, as of this writing, McCraw’s words have found no mention in the Times itself,” activist Ray McGovern wrote for the alternative media outlet Consortium News. “In recent years, the newspaper has shown a marked proclivity to avoid printing anything that might risk its front row seat at the government trough.” So let’s unpack that a bit. It is now public knowledge that the Ecuadorian government is actively seeking to turn Assange over to be arrested by the British government. This was initially reported by RT, then independently confirmed by The Intercept, and is today full mainstream public knowledge being reported by mainstream outlets like CNN.

It is also public knowledge that Assange’s asylum was granted by the Ecuadorian government due to a feared attempt to extradite him to the United States and prosecute him for WikiLeaks publications. Everyone from President Donald Trump to Attorney General Jeff Sessions to now-Secretary of State Mike Pompeo to ranking House Intelligence Committee member Adam Schiff to Democratic members of the US Senate have made public statements clearly indicating that there is a US government interest in getting Assange out of the shelter of political asylum and into prison.

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The state of the media is something to behold. Can it slide even further? You bet.

Round the Bend (Jim Kunstler)

Some people you just can’t reason with, especially the hell-spawned man-beast who personally directed Russian “meddling” and “interference” in our election and stole certain victory from president-designee Hillary. (I know this because The New York Times and The Washington Post said so.) Another astonishment: in his testimony before the Senate Foreign Relations Committee this week, Secretary of State Mike Pompeo said the US would not recognize Crimea as part of Russia and would demand the return of the region to Ukraine. Not to put too fine a point on it, Mr. Pompeo is pissing up a rope on that one. Russia will not give up its warm-water naval bases on the Black Sea anymore than the US will return its San Diego naval installation to Mexico, and Mr. Pompeo knows it.

So do the posturing idiots on the senate committee, who apparently forgot that our own government officials fomented the 2014 Ukrainian coup that prompted Russia to annex Crimea and its military assets in the first place. How many of you feel a gnawing disgust and contempt for both sides of the US political spectrum? The news, day and night, reveals a nation unable to think, unable to discern reality from fantasy, avid to dissemble and lie about absolutely everything, eager to support any racketeering operation designed to fleece its own citizens, and utterly ignoring the genuine problems that can drive us into a new dark age.

On balance, and just for now, I’m more disturbed by the side represented by the Democratic Party, aka the “progressives” or “the Resistance,” because they are responsible for politicizing the FBI before, during, and after the 2016 election and that was a dastardly act of institutional debauchery in an agency with the power to destroy the lives and careers of American citizens. The product of that corruption is a dangerous manufactured hysteria inciting hostility and aggression against another nation that could lead to a war that humanity will not recover from.

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Austerity leads to right wing support everywhere.

David Cameron’s Welfare Cuts Led Directly To The Brexit Vote (Ind.)

As the Brexit negotiations roll on, we do see some signs of progress. Our understanding of the underlying causes of the referendum outcome has developed significantly in the last two years. Leave-supporting areas can be easily distinguished from those supporting Remain. Broadly speaking, they are more deprived, have lower levels of income, fewer high status-jobs, a weaker economic structure, and an ageing demographic with lower levels of educational attainment. Further, non-economic factors have also been highlighted as important correlates of support for Brexit . But an open question to economists, though, is what are the economic origins of the relationships between these characteristics and support for Leave?

An important cross-cutting observation that has been made over and over again is that Leave-supporting areas stand out in having an electorate that has been “left behind”, is particularly reliant on the welfare state and is thus exposed to welfare cuts. In a recent paper, I show that austerity-induced reforms, including widespread cuts to the welfare state since 2010, were an important factor behind the decision of many people to shift their political support to UKIP and, subsequently, support Leave in the EU referendum.

The austerity-induced reforms of the welfare state, implemented in the years after 2010, were broad and deep. In 2013, it was estimated that the measures included in the Welfare Reform Act of 2012 would cost every working-age Briton, on average, around £400 per year. Crucially, the impact of the cuts was far from uniform across the UK: it varied from around £900 in Blackpool to just above £100 in the City of London. Aggregate figures suggest that overall government spending for welfare and protection contracted by 16 per cent in real per capita terms, reaching levels last seen in the early 2000s.

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What is Bernie thinking?

An Open Letter to Bernie Sanders: ‘No Bernie, It Wasn’t the Russians’ (MPN)

Let me preface this open letter of sorts that I’m writing to Senator Bernie Sanders. I’m not penning this missive as though I’m a crestfallen supporter, after falling for the okie doke in 2008 and waking up to the deception of Obama, I decided to stop putting my faith in politicians. Rather, I write this article on behalf of Bernie’s legions of supporters and the millions of Americans who put their faith in someone who spoke against the iniquities that are ravaging our nation and our planet as a whole. Bernie, it was your decision to speak against this consolidated graft that is cratering society that captured the imagination of the disaffected and gave people hope that their voices could be heard above the cash extortion that dominates our government.

Instead of continuing your rebellion against the establishment and speaking against the corrosive nature of our politics, you are charting a course towards irrelevance by jumping on this cockamamie #Russiagate narrative. Here is what I don’t get about your decision to glom on to this most ridiculous assertion that 12 Russians had more impact on our elections than the billions of dollars that are spent by corporations and plutocrats to bend elected officials like pretzels. The insinuation the punditry is making is that Americans were duped to vote against their own self-interests because they refused to vote for Hillary Clinton.

Never mind that Hillary was one of the most divisive and disliked politician to run for president in modern American history. Never mind that the DNC essentially rigged the primaries to ensure her victory at your expense. Instead of focusing on the structural and systematic flaws that render our votes irrelevant, fingers are pointed at a manufactured villain halfway around the world in order to distract from the fact that our elections have been hijacked by moneyed interests and entrenched leeches who are sucking the citizenry dry. Whatever efforts Russia might have made to influence our elections were outweighed by a kleptocracy that hacked down our democracy with dark money and self-centered politicians who put their interests above that of the people they purportedly serve.

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This one’s for you, bible belt.

Putin Calls Christianity Foundation Of Russian State (AP)

Vladimir Putin says that the adoption of Christianity more than 1,000 years in territory that later became Russia marked the starting point for forming Russia itself. Putin’s comments came Saturday in a ceremony marking the 1,030th anniversary of the adoption by Christianity by Prince Vladimir, the leader of Kievan Rus, a loose federation of Slavic tribes that preceded the Russian state. Speaking to a crowd of thousands of clergy and believers at a huge statue of the prince outside the Kremlin, Putin said adopting Christianity was “the starting point for the formation and development of Russian statehood, the true spiritual birth of our ancestors, the determination of their identity. Identity, the flowering of national culture and education.” The comments underline strong ties between the government and the Russian Orthodox Church.

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Book review. Hope the book itself is better. What social media do to people’s brains and social lives is far more relevant.

Ten Arguments for Deleting Your Social Media Accounts Right Now (Star)

If you’re online these days, you likely sense that something’s wrong with the internet. You probably feel weird about how many times a day you check Facebook or Instagram, and likely a little uneasy about how annoyed or envious you feel when you do. Maybe the hostility online depresses you. Maybe you worry about the next generation, and how anxious they all seem. Maybe you’ve even considered deleting your accounts. This is exactly what Jaron Lanier, a leader in the tech world, says you should do. Right away. Lanier — a pioneer in the world of internet startups, and virtual reality in particular — has long been a critic of the Silicon Valley status quo. In this slim, highly-readable manifesto, he lays out his case against social media. And it is a devastating one.

In 10 simple arguments, the tech insider paints a picture of a wide-scale behaviour modification apparatus driven by social attention — both the carrot of approval and the stick of criticism, which generates the most intensity or “engagement.” “There is no evil genius seated in a cubicle in a social media company performing calculations and deciding that making people feel bad is more ‘engaging’ and therefore more profitable than making them feel good,” he writes. “Or at least, I’ve never met or heard of such a person. The prime directive to be engaging reinforces itself, and no one even notices that negative emotions are being amplified more than positive ones.”

According to Lanier, the social media apparatus has made people into lab rats, placing them under constant surveillance. He believes the process is making people angrier, more isolated, less empathetic, less informed about the world, and less able to support themselves financially. Add to all that: Lanier says this highly tuned behaviour modification system is for rent to anyone looking to influence the public. The constant stream of data, and the algorithms that tweak subsequent efforts to sway people, aren’t just used to sell soap, he notes, but to influence politics.

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Wonderful tale. But given the demise of insect numbers, bats must be under severe threat.

Nature’s Darkness-Creature Has Become Ours, Too (G.)

Here’s a flicker in the periphery. I notice it because of the way it moves; it’s a sort of fast fidget – staccato and angular in movement and path, like a movie projected at the wrong frame rate. It doesn’t swoop like a swallow, or bumble like a moth. The bat moves like a bat, and like nothing else. I’m sitting near my home under some trees, watching the coming night deepen the navy sky. The day has been airlessly hot, and with nightfall relief creeps into the air like a balm. Animals are out – I can hear twitches in the bushes behind me. Young frogs; hedgehogs maybe. Looking for water. Then I notice this bat. Seconds after I see it, I feel it pass so close that it makes my hair move, with it a split-second rustle of papery wings. I shiver.

Bats are just flying mice, people say, except they’re not, at all. Worldwide there are two main groups: Megachiroptera, big-eyed, placid-faced, small-eared – almost anthropomorphic, a man-bat; and Microchiroptera, the opposite. Nature’s darkness-creature has over time become ours, too. Their thorny outline is so conversant with the sinister that we nearly forget why. Light never catches them. They are opaque, darkly anonymous silhouettes into which humans project all manner of eerie ideas. Unwittingly, bats reinforce these with their habits. They haunt churches. Fly by night. Sleep subversively inverted. And the one far-flung species that feeds on blood bears the name “vampire” all too neatly.

This solitary bat flies about me in rapid loops. This one is maybe a noctule, or a pipistrelle. Catching insects perhaps. I worry that it will hit me but it won’t. It sees by echoing its sounds off nearby objects like aerial sonar, and it’s an excellent way to navigate. Those sounds are too high-pitched for the human ear to detect, and so to us, other than those wings, the bat makes no sound. None at all. I watch it. Bats need to catch air under their wings to fly. They can’t lift off like birds: they must drop. Their flight is a fall, arrested again and again with each frantic flap. That’s why they don’t move like anything else. Except, perhaps, a human trying to fly.

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And so the issue keeps shifting. But it doesn’t get resolved.

Migrant Arrivals Push Shelters To Breaking Point In Southern Spain (El Pais)

Shelters in the south of Spain are struggling to deal with a huge influx of migrants, many of whom are being left without a proper place to sleep. The arrivals – 1,300 in the past three days – have stretched services to their breaking point with the strain felt particularly hard in Algeciras as well as other municipalities along the coast of Andalusia. The number of undocumented migrants arriving in Spain has doubled since last year. Spain is now the main entry point into Europe, above Italy or Greece. But shelter services have been unable to keep up with the demand, leaving many migrants to sleep in overcrowded centers.

Up to 260 migrants spent the past two nights on the deck of a Maritime Rescue ship, more than 50 huddled together on a small courtyard of a police station in Algeciras, and 90 more jostled for a spot in the port of Barbate. Many more are left to wander the streets of towns like Medina Sidonia and Chiclana after spending the maximum legal 72-hour period in police custody. Immigration officials have traveled to Cádiz to look for a solution to what the Spanish government describes as a “collapse” of services. In a press release, the government said that 400 migrants had nowhere to go and blamed the problem on the former administration of Mariano Rajoy for its “lack of foresight.” “The number of arrivals has not stopped rising since 2017 but despite this nothing was done,” said a spokesperson for the Interior Ministry.

IN NUMBERS
• The number of people arriving by sea has tripled in the past year. Since the beginning of the year, 22,711 migrants have reached Spain, 19,586 by sea.
• Spain has overtaken Greece and Italy as the country which received the highest number of migrants.
• An average of 54 people arrived in Spain by sea each day in the first five months of 2018. That average has since shot up to 220 per day.
• Since the beginning of the year, 294 people have died trying to reach Spain – almost double the figure from the same period last year.

Read more …

Your donations are now also feeding the people in Mati, where conditions are really bad. I’ll have much more on the Automatic Earth for Athens Fund soon, many new and very positive developments, after a bit of a lull. More donations of course are needed and welcome.

Number Of Fatalities In Greek Wildfires Rises To 88 (K.)

A 42-year-old woman who was in intensive care after suffering extensive burns in the deadly wildfire that ripped through the coastal town of Mati in east Attica this week died early Saturday morning, raising the number of fatalities to 88. On Friday night, authorities also identified the bodies of the nine-year-old twin girls and their grandparents that went missing after the wildfires. Their bodies were among a group of victims recovered by emergency crews on Tuesday lying close together near the top of a cliff overlooking a beach. The news was reported on broadcaster SKAI by the private investigator the family had hired to find the children. It was confirmed by a reported friend of the family on his Facebook page.

The twins’ father had provided forensic authorities with a DNA sample and appeared on several TV stations seeking help in finding them. A total of 46 adult burn victims are being treated in hospitals in Athens, with nine of them in intensive care. Two children remain in hospital but authorities said their injuries are not life-threatening. Five days after the deadly blaze, there was still confusion over the number of those missing. The Athens Medical School’s Forensics and Toxicology Lab said it has conducted autopsies on 86 bodies, of which only 25 have been identified. As sources explained to Kathimerini, in the first 48 hours after the fires, several authorities wrote up lists of missing persons, which means the same people may have been recorded twice or more.

Since there was no official information on where relatives should report missing persons, police started separate investigations, when the relevant authority in this case would have been the fire service. On Saturday, Dimitra Lambarou, the deputy mayor of Marathonas, which has administrational jurisdiction over the majority of the devastated coastal town on Mati, said she is resigning over the deadly fires. “Since no-one else did it, I will,” she told broadcaster SKAI on Saturday. “I’m really ashamed for all those people who are in positions of responsibility,” she said and accused Marathonas mayor Ilias Psinakis of “not rising to the occasion.”

Read more …

Jun 202018
 
 June 20, 2018  Posted by at 9:22 am Finance Tagged with: , , , , , , , , , ,  


Edward Hopper New York movie 1939

 

The Smart Money Gets Ready for the Next Credit Event (WS)
Global Debt Has Hit A High – Can Financial Regulators Cope? (Davies)
Stock Markets Roiled As US-China Trade Dispute Escalates (G.)
European Firms Say China Business ‘More Difficult’ (AFP)
Canada Legalises Recreational Marijuana Nationwide (Ind.)
Smearing A Dissident Journalist Is As Good As Killing Him (CJ)
“Delete Your Account” Warns Virtual Reality Founding Father (ZH)
1 In 3 UK Primary School Teachers Provide Pupils With Toothpaste, Soap (Ind.)
Merkel, Macron Agree On Eurozone Budget (CNBC)
EU To Consider Plans For Migrant Processing Centres In North Africa (G.)
EU Rebuked For €36 Billion Refugee Pushback Gambit (G.)
34,361 And Rising: Tallying Europe’s Migrant Bodycount (G.)
The Vanishing Of The Swifts (G.)

 

 

Scary.

The Smart Money Gets Ready for the Next Credit Event (WS)

As corporate indebtedness in the US has reached precarious heights, and as risks are piling up, in an environment of rising interest rates and a hawkish Fed, the smart money is getting ready. The smart money is preparing for the moment when the air hisses out of the exuberant junk-bond market, when liquidity dries up for over-indebted companies, and when their bonds collapse. The smart money is preparing for the arrival of “distressed debt” – it’s preparing now because these preparations include raising billions of dollars for their funds, and that takes some time. “Distressed debt” is defined as junk-rated debt that sports yields that are at least 10 percentage points above equivalent US Treasury yields.

Distressed-debt investors can make a killing by buying bonds for cents on the dollar during times of economic stress, of companies that they believe will make it through the cycle without defaulting. In this scenario, a distressed bond might sell for 40 cents on the dollar, and two years later, the company is still intact and the credit squeeze is resolved, and now the bond is worth face value. For those two years, the bond paid a huge yield to investors that bought at 40 cents on the dollar – and the profit might be 200% in capital gains and interest. The thing is: The junk-bond market has been booming. There’s no credit squeeze yet. And the riskiest end is flush as the “dumb money” is still chasing yield.

And for the smart money, there’s not much to pick at the moment; but down the road, the future looks bright. S&P Global tracks distressed debt in its US High Yield Corporate Distressed Bond Index. The index peaked in early July 2014, on the eve of the oil bust. Over the next 18 months, it plunged 56% as the oil bust was wreaking havoc on oil-and-gas bonds. But on February 11, 2016, the index bottomed out. New money began flowing into the oil-and-gas sector. Banks started lending again. The surviving bonds soared. And the index skyrocketed 113% in 28 months:

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Really? The IMF?

Global Debt Has Hit A High – Can Financial Regulators Cope? (Davies)

At the end of May, the International Monetary Fund launched its global debt database. For the first time, IMF statisticians have compiled a comprehensive set of calculations of public and private debt, country by country, constructing a time series stretching back to the end of the second world war. It is an impressive piece of work. The headline figure is striking: global debt has hit a new high of 225% of world GDP, exceeding the previous record of 213% in 2009. So, as the IMF points out, there has been no deleveraging at the global level since the 2007-08 financial crisis. In some countries, the composition of debt changed, as public debt replaced private debt in the post-crisis recession, but that shift has mostly stopped.

Are these large figures alarming? In aggregate terms, perhaps not. At a time when economic growth is robust almost everywhere, financial markets are relaxed about debt sustainability. Long-term interest rates remain remarkably low. But the numbers do tend to support the hypothesis that the so-called debt intensity of growth has increased: we seem to need higher levels of debt to support a given rate of economic growth than we did before. Perhaps that is partly because the growth in income and wealth inequality in developed countries has distributed spending power to those with a propensity to spend less than their income. That trend has levelled off recently, but the implications are still with us. It also seems that productivity growth has slowed, so a given quantum of investment generates less output than it used to do.

The IMF’s recommendation to governments is that they should fix the roof while the sun is shining: accumulate a fiscal surplus, or at least reduce deficits, in good times so that they are better prepared for the next downturn, which will surely come before too long. The current upturn is now quite mature. That puts the IMF on a collision course with the tax-cutting US administration and now with Italy’s new government. If the Italians’ grandiose plans for a minimum income and more public investment are implemented, they might soon find themselves in difficult discussions with the IMF. The team that has been in Athens for the past few years might soon be booked on a flight to Rome.

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Keep negotiating.

Stock Markets Roiled As US-China Trade Dispute Escalates (G.)

The trade dispute between the US and China escalated on Tuesday, with a senior Trump official accusing China of “theft” and Beijing accusing the US of blackmail. The news roiled global stock markets as investors feared that escalating tensions could trigger an international trade war. Donald Trump threatened to impose an additional $200bn in levies on Chinese goods on Monday evening, days after the US announced $50bn in tariffs aimed at punishing what the US administration sees as unfair trade practices. China has already said it will retaliate for last week’s move and said it would escalate its response if further tariffs were imposed.

In a call with reporters Peter Navarro, White House trade adviser and a longtime critic of China’s trade practices, said China had had numerous opportunities to address Washington’s concerns but had failed to do so. “Since China joined the World Trade Organisation in 2001, the working men and women of America have watched as more than 70,000 factories and millions of manufacturing jobs have moved offshore,” said Navarro. He called Trump’s plans’ “courageous” and “visionary” and said they were aimed at halting China’s plans to dominate the hi-tech industries of the future – a plan, known as China 2025, that Navarro said that would mean America “will have no economic future”.

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“As its economy matures, the longstanding inefficiencies in China’s business environment are rendered all the more glaring..”

European Firms Say China Business ‘More Difficult’ (AFP)

European companies complain they still face a tough business climate in China despite Beijing’s pledges of openness, with about half saying it has become tougher in the past year, according to a survey released Wednesday. The study comes as President Xi Jinping looks to portray the world’s number two as being at the forefront of the globalisation cause just as the United States appears to be stepping back from the world stage. Among the litany of complaints were the uncertain legal environment, higher cost of labour, regulatory headaches and the “Great Firewall” that censors much of the global internet. “As its economy matures, the longstanding inefficiencies in China’s business environment are rendered all the more glaring,” according to the report by the EU Chamber of Commerce in China.

Mats Harborn, the chamber’s president, echoed those concerns, telling journalists that “the regulatory environment is actually holding the economy back.” New cybersecurity regulations make it more costly to jump the firewall, requiring businesses to sign up for expensive government-approved virtual private networks that allow users to circumvent filters and access the global internet. Two-thirds of companies believe that censorship and blocking of certain sites has a negative impact on their business. This is the “great contradiction,” said Harborn. “We have China which claims itself a leader in globalisation, talking of the importance of integration, but the cybersecurity law is creating problems.”

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Unstoppable force by now. But do follow the money.

Canada Legalises Recreational Marijuana Nationwide (Ind.)

Canada has legalised the use of recreational marijuana nationwide, making it the first G7 country to do so. The Senate voted 52-29 on Tuesday to pass the Cannabis Act, which allows people over the age of 18 to grow, buy, and use the drug for recreational purposes. It also regulates the growth and sale of marijuana, putting strict limits on packaging and limiting home growth to four plants at a time. The bill passed the House of Commons earlier on Tuesday, and now goes to Prime Minister Justin Trudeau – an outspoken supporter of the legalisation effort – to decide when it will take effect.

The vote makes Canada the second country to legalise recreational marijuana nationwide, after Uruguay. It is the first of the world’s seven most advanced economies – also known as the G7 – to do so. Nine US states allow for recreational use, and several other G7 nations allow it for medical purposes. Medical marijuana has been legal in Canada since 2001.

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Wonder what happened at the UN human rights commission talk yesterday in Geneva.

Smearing A Dissident Journalist Is As Good As Killing Him (CJ)

As I write this, demonstrations around the world are taking place in protest of WikiLeaks editor Julian Assange’s arbitrary detention and silencing by the US-centralized power establishment that has been actively pursuing his destruction for over a decade. The demonstrations will be well-attended, but not a fraction as well-attended as they should be. They will receive international attention, but not a fraction as much attention as they should. This is because the manipulators and smear merchants who have made their careers paving the way for oligarchic agendas have been successful in killing off sympathy for the plight of Assange. As we discussed yesterday, sympathy is key for getting narratives to take hold in public consciousness.

This is why western corporate media will circulate pictures of dead children all day long when it’s in the interests of advancing longstanding imperialist agendas, but never when those children were killed by western weapons. If you can tug at someone’s heart strings while telling them a story, the story you tell them will slide right in with minimal scrutiny. And it works the other way, too: if you can prevent someone’s heart strings from being plucked while hearing about a legitimately heartbreaking story, you can prevent that story from taking hold. Kill all sympathy for a dissident journalist and you kill all belief in his side of the story.

And Assange’s side of the story is indeed devastating to the preferred narrative of the US-centralized empire. A journalist (yes, journalist, per definition) who publishes 100 percent authentic documents exposing the inner mechanics of power structures all over the world, who was forced to seek political asylum at the Ecuadorian embassy in London in order to avoid extradition by the same government which brutalized Chelsea Manning, is on its face a highly sympathetic story. And it does tremendous damage to the narrative that America and its close network of allies are freedom-loving democracies whose systems of government are nothing like those naughty, oppressive regimes they seek to topple.

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“When you watch the television the television isn’t watching you. When you see the billboard the billboard isn’t seeing you… ”

“Delete Your Account” Warns Virtual Reality Founding Father (ZH)

In a new explosive interview, Silicon Valley tech pioneer and creator of the virtual reality ‘avatar’ Jaron Lanier tells people to delete your social media accounts due to the strong correlation between persistent social media usage and a dramatic societal rise in depression, anger, and anxiety that he says is the result of internet-induced modified forms of behavior. The warning comes in the wake of his new book which details how the creators of social media and the early engineers behind the internet “foolishly laid the foundations for global monopolies.” Jaron Lanier is best known as a founding father of the field of virtual reality and throughout his polymath career has written extensively on human-computer interaction, including most recently in his book Ten Arguments for Deleting Your Social Media Accounts Right Now.

Lanier explained in a recent UK Channel 4 interview: “When you watch the television the television isn’t watching you. When you see the billboard the billboard isn’t seeing you… When you use these new designs — social media, search, YouTube — when you see these things, you’re being observed constantly and algorithms are taking that information and changing what you see next.” According to Lanier’s bio, he coined the term ‘Virtual Reality’ (VR) and in the early 1980s founded VPL Research, the first company to sell VR products. In the late 1980s he led the team that developed the first implementations of multi-person virtual worlds using head mounted displays, as well as the first “avatars,” and developed the first widely used software platform architecture for immersive virtual reality applications.

As he defiantly asserts on his personal website, Lanier himself has “no social media accounts at all and all purported ones are fake.” He’s elsewhere said that most internet and social media pioneers in Silicon Valley “have regrets right now” after perfecting what is essentially mass human behavioral engineering and that that internet addiction is not only ruining people’s lives but the political process as well. This is what I could call almost a stealthy addiction. It’s a statistical addiction. What it says is we will get the broad population to use the services a lot, we’ll get them hooked through a scheme of rewards and punishment, and the rewards are when you’re retweeted and the punishment is when you’re treated badly by others online, and then within that we’ll very gradually start to leverage that, to change them. It’s this very kind of stealthy manipulation of the population.”

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Inglan is a bitch.

1 In 3 UK Primary School Teachers Provide Pupils With Toothpaste, Soap (Ind.)

One in three teachers are providing pupils with basic hygiene products such as toothpaste and soap amid soaring child poverty rates, a new study shows. Eight in ten primary school teachers have said they had seen a rise in the numbers of children coming to school unwashed or not looking presentable in the last five years and have found themselves intervening at an increasing rate. A survey carried out by UK charity In Kind Direct also revealed nearly one in five (18 per cent) of teachers say they have to resort to doing this every single week, with the problem starkest in London – where 50 per cent do this weekly – and in the North East, where the figure stands at 29 per cent.

It comes as child poverty rates have surged in recent years, with one million more children in working households now growing up in poverty than did so in 2010, largely because of cuts to in-work benefits and public sector pay freezes. Nicola Finney, head teacher at St Paul’s Primary School in Stoke on Trent, told The Independent around 18 per cent – or nearly one in five – of her pupils’ families were receiving products from the school, as growing numbers of households are “falling on hard times”.

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And the other 17 must follow.

Merkel, Macron Agree On Eurozone Budget (CNBC)

Chancellor Angela Merkel said she and French President Emmanuel Macron agreed on Tuesday to create a euro zone budget charged with boosting investment in the currency bloc and promoting economic convergence between its 19 member states. “We are opening a new chapter,” Merkel said after talks with Macron on European reform ahead of a June 28-29 EU summit. She said euro zone reform was the toughest issue in their talks. “We are working to make sure that the euro zone budget will be used to strengthen investment, also with the aim of strengthening convergence within the euro zone,” she added.

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Like those in Libya you mean?

EU To Consider Plans For Migrant Processing Centres In North Africa (G.)

The EU is to consider the idea of building migrant processing centres in north Africa in an attempt to deter people from making life-threatening journeys to Europe across the Mediterranean, according to a leaked document. The European council of EU leaders “supports the development of the concept of regional disembarkation platforms”, according to the draft conclusions of an EU summit due to take place next week. The EU wants to look at the feasibility of setting up such centres in north Africa, where most migrant journeys to Europe begin. “Such platforms should provide for rapid processing to distinguish between economic migrants and those in need of international protection, and reduce the incentive to embark on perilous journeys,” says the document seen by the Guardian.

Although the plan is winning influential support, it faces political and practical hurdles, with one expert saying it is not clear how the EU would get foreign countries to agree to be “vassal states”. Migration is high on the agenda of the two-day summit, which opens on 28 June. EU leaders will attempt to reach a consensus on how to manage the thousands of refugees and migrants arriving each month. The German and French leaders, Angela Merkel and Emmanuel Macron, met near Berlin on Tuesday to agree on a common approach, amid fears in their camps that the European project is unravelling. Before the meeting France’s finance minister, Bruno Le Maire, said Europe was “in a process of disintegration. We see states that are turning inward, trying to find national solutions to problems that require European solutions.”

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It’s not about money, but that’s all they can think of.

EU Rebuked For €36 Billion Refugee Pushback Gambit (G.)

The European Union is to increase its spending in Africa by more than 20% over the next seven years to a minimum of €36bn in an attempt to reduce the number of migrants and refugees crossing the Mediterranean. But a succession of reports funded by the EU or written by leading MEPs say European efforts to stem the flow is characterised by misdirected finances, lack of accountability and repeated breaches of basic human rights, including an inability to undermine the business model of human trafficking, an industry worth as much as £35bn a year. Special concern has been expressed that EU funds are being used to give bonuses to the Italian-trained Libyan coastguard to force boats back to Africa.

The arrival of millions of refugees in Europe – and the deaths of thousands more attempting the crossing – has become the continent’s biggest policy headache, now threatening the stability of the German government and the cohesion of the EU. The biggest challenge is Libya, where deepening political chaos has led to more than 500,000 people crossing into Italy in recent years, hastening the election of a populist government in Rome that is now threatening to form an anti-migrant “axis of the willing” with like-minded central and eastern European countries.

Politicians are scrambling for a new formula not just to distribute the people who have reached Europe but also to return those whose asylum claims are refused. The EU is also searching for a credible means to reduce the incentive for people to come to Europe. The fate of mainstream social democratic and centrist parties in next spring’s European elections may rest on the outcome. A detailed examination of EU efforts to tackle the issue finds a “mismatch between the grandiloquent declarations and the action actually implemented on the ground”.

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The real number is much higher.

34,361 And Rising: Tallying Europe’s Migrant Bodycount (G.)

The vast majority of migrants who have died trying to reach Europe have drowned. Volunteers have logged more than 27,000 deaths by drowning since 1993, often hundreds at a time when large ships capsize. These account for nearly 80% of all the entries. The list points up the marked increase in drownings that occurred after 2014, when the conflict in Syria accelerated, adding to numbers from south Asia and sub-Saharan Africa. In 2013, it reports more than 900 deaths by drowning. By 2017 that number had increased to around 3,500. A wave of public sympathy for the plight of refugees in Europe was quickly displaced by a backlash against the rising number of arrivals in 2015 and 2016, when almost three million people claimed asylum in Europe.

The EU responded by trying to export the problem back to Africa, with a €2bn (£1.75bn) EU-Africa trust fund designed to encourage African countries to stop people making the journey to Europe. The figures show the impact of this policy shift: in 2014, there were around 1,700 deaths recorded in and off the coast of Africa ascribed to migrants trying to get to Europe; by 2017 this had almost doubled, while deaths in Europe halved over the same period. “Some would say there are fewer deaths in Europe, and the EU’s policy is working”, says Ann Singleton, an academic specialising in migration data at the University of Bristol. “But there’s so much that’s unknown. Deaths are less likely to be reported if they occur in remote areas of Africa, and the number of people are dying inland, or in Libyan detention camps, isn’t recorded.

“If you look at maps, it looks as though the Mediterranean is the most dangerous area of the world for migrant journeys. But we can never say if that’s true, because we simply don’t know what’s happening elsewhere,” says Singleton. For those who get to Europe, the danger is not over. The List records more than 500 deaths in the asylum process, detention centres, prisons and camps. Among this group, the most common cause of death is suicide.

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Swifts eat flying insects.

The Vanishing Of The Swifts (G.)

It is the most miraculous bird, the ultimate winged messenger, exploring our globe, spending its life on the breeze. Sickle-shaped wings silhouetted against the sky, the swift is the fastest of all birds in level flight and remains entirely airborne for 10 months, or more, feeding, sleeping and mating on the wing. These long-lived creatures can clock up 4 million miles, commuting between English summers and African winters. Something has changed though. June is erupting as gloriously as it ever did: roadsides are waving with oxeye daisies and blackbirds flute during the endless evenings. But summer is a shadow of its former self. The swifts aren’t here. Well, they are. Only not as we knew them. I heard a scream just now, felt that start of wonder, and glanced up. One swift. No – three, darting through the blue. Three birds.

It’s like returning to the place where you grew up and finding your old home bulldozed. Reality does not compute with the picture you remember. I knew the swift for its screaming parties, marvellous groups of 20 or 40 or 60 or uncountable numbers of birds racing together through the sky, flicking their wings, calling in apparent glee. But this bird is in freefall. A graph produced by the British Trust for Ornithology is terrifying: the British population declined by 51% between 1995 and 2015. And the rate of decline is increasing: down 24% in the five years to 2015. The decline of globalised animals is always global, and complicated. So the disappearance of other equally charismatic long-distance migrants such as nightingales, cuckoos and swallows is bound up in habitat loss or changes in Africa, as well as Britain, and climatic changes en route.

Living in roofs, swifts have also suffered from the conversion of derelict buildings, and our desire for more energy-efficient, impermeable homes. But the biggest cause of changes in animal populations is always food supply. And guess what? Swifts feed on flying insects. We are belatedly waking up to the global calamity that is the loss of insect life. The German study showing a 76% decline in flying insects since 1989 is no anomaly. In Britain, for instance, three-quarters of butterfly species have declined over 40 years, while moth abundance has fallen by more than 40% in the southern half of the country.

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Jan 102018
 
 January 10, 2018  Posted by at 9:19 pm Finance Tagged with: , , , , , , , , , ,  


Giorgione The Tempest 1508

 

Happy belated new year. Belatedly. Thought I’d sit out a few days, since there wasn’t much news to be expected. And it did pan out that way, other than Trump bogarting the limelight; but then, that isn’t really news either. Anything he says or does triggers the expansive anti-Donald echo chamber into a daily frenzy. And frankly, guys, it’s not just boring, but you’re also continuously providing him with free publicity. At least make him work for some of it.

Then, however, the big microprocessor (chip) security ‘flaw’ was exposed. And that’s sort of interesting, because it concerns the basic architecture of basically every microchip produced in the past 20 years, even well before smartphones. Now, the first thing you have to realize is that we’re not actually talking about a flaw here, but about a feature. We use that line a lot in a half-jokingly version, but in this case it’s very much true. As Bloomberg succinctly put it:

All modern microprocessors, including those that run smartphones, are built to essentially guess what functions they’re likely to be asked to run next. By queuing up possible executions in advance, they’re able to crunch data and run software much faster. The problem in this case is that this predictive loading of instructions allows access to data that’s normally cordoned off securely..

And:

Spectre fools the processor into running speculative operations – ones it wouldn’t normally perform – and then uses information about how long the hardware takes to retrieve the data to infer the details of that information. Meltdown exposes data directly by undermining the way information in different applications is kept separate by what’s known as a kernel, the key software at the core of every computer.

As I said: feature, not flaw (or two really, Spectre and Meltdown). And that makes one wonder: fixing a flaw is one thing, but how do you fix a feature? Several quotes claim that software patches would mean the performance speed of affected chips (that would be all of them) would go down by 25-30% or so. Which is bad enough, but the problem is not -limited to- software. And patching up hardware/firmware issues with software can’t be easy, if even viable.

That would make one suspect that even if a software patch can suppress this feature, as long as the architecture doesn’t change, it can still function as a backdoor. Apple may say there are no known exploits of it, but would they tell if for instance intelligence services used it? Or other parties that cannot be labeled ‘hackers’?

 

All that ties in seemingly seamlessly with Apple shareholders expressing their worries about the effect of their investments. Though you might want to wonder if their worries would be the same if Apple shares plummeted tomorrow.

 

Two Major Apple Shareholders Push for Study of iPhone Addiction in Children

..activist investor Jana Partners and the California State Teachers’ Retirement System urged Apple to create ways for parents to restrict children’s access to their mobile phones. They also want the company to study the effects of heavy usage on mental health.

There are a few things off with this. First, there’s the risk of these kids’ iPhones being hacked through the flaw, feature, backdoor mentioned above. That’s potentially a lot worse for them. Then, there’s the obvious fact that parents can simply take their children’s phones away, there’s no better way to restrict access. Why should that be Apple’s responsibility?

But most of all, children are addicted to their phones because of the content, and Apple, though they would wish it were different, are not the major content providers. That role is played by Alphabet/Google/YouTube and Facebook/Instagram, and to a lesser extent Snapchat and Twitter. And they are a much bigger threat than Apple is.

 

There has been a lot of talk about hate speech, fake news and election interference over the past year and change -and it won’t stop anytime soon, because it’s political gold dust. Germany, France, the UK, US and a whole slew of smaller nations have all tried to implicate Russia in all of these issues, and for good measure opposition parties to incumbent governments have been fingered too.

There are perhaps very obvious examples of all three topics, but the issue as a whole is far from clear. In Germany, Twitter accounts of the Alternative für Deutschland party have been blocked, but given that they now have seats in parliament, that is a tricky problem. Likewise, much of what the US MSM has been writing about Trump and his organization has proven unsubstantiated, and could therefore be labeled fake news. It isn’t to date, other than by the president himself, but who draws the line where?

The US election interference narrative is shaky, since it largely appears to rely on $100k or so in Facebook ads bought by some mysterious party, ads that are supposed to have been much more effective than many billions of dollars in campaign funding. The kind of thing that makes you think: if the Russians are so much better at this than we are, we might as well hand it all over to them right now.

The main problem with the election interference stories is that none of it has ever been proven. Not even the $100k+ in Facebook ads; they might just as well have originated in Langley and we only have Langley’s word for any alternative claims. Overall, defining what is hate speech and what is fake news seems to come down far too much to opinions rather than facts, and that has us sliding down a supremely slippery slope, not exactly a place to build solid policy on.

So how and why can Facebook and Google be trusted to provide objective assessments on what is fake news and hate speech vs what is not? That is what they are being tasked with at present. They hires tens of thousands of people to do that ‘job’. But what are these people’s qualifications? How do these companies make sure political bias is kept out of the process? Do they even want to keep it out, or do Zuckerberg, Brin, Schmidt want to confirm their own bias?

It’s hard to see how the decision making process, fake vs real news, hate speech, political meddling, will not inevitably become one guided and goaded by intelligence services, because they are the ones who claim to have both the knowledge and the evidence upon which these decisions must be based. But US intelligence is not politically neutral, and they don’t share the sources of their ‘evidence’.

 

 

Still, none of that is the main problem here either. Though we’re getting closer.

Over the holidays, I saw a movie in which there was a teachers’ Christmas party at some highschool. All the teachers were bored and sat or stood in silence looking at nothing. And I realized that kind of scene no longer exists today. Though the movie was just 10-15 years old, there have been some profound changes. At a party like that, or at a busstop, in a bus or train, a waiting room or even a family dinner, everyone is now glued to their smartphone. Even people walking down the street are. And those driving down the street.

What all these people seem to do most is look at their Facebook/Instagram/Snapchat etc. accounts. And apart from the profound changes to human interaction in public spaces, there are other things that deserve attention. Like for instance that while you think you’re having private conversations with your friends and family, there’s nothing private about it. Everything you tell your ‘friends’ de facto becomes property of the owners of the app you’re sharing it on.

When your friends read what you just wrote, they see not only that but also ads that the app displays alongside it. That means Facebook makes money from your friends’ attention for your words. Since Facebook reached 2 billion active users in 2017, that adds up. And they don’t have to do anything for that, other than keep the channels open.

But that is not the worst part. Facebook not only makes money off your contact with family and friends, something most people would probably find comparatively innocent, it also ‘spies’ on you. At the very least, its algorithms actively scour its databases to suggest possible additional friends, and/or people you might know. That can lead to unexpected and potentially undesirable results:

 

Facebook Figured Out My Family Secrets, And It Won’t Tell Me How

Rebecca Porter and I were strangers, as far as I knew. Facebook, however, thought we might be connected. Her name popped up this winter on my list of “People You May Know”, the social network’s roster of potential new online friends for me. The People You May Know feature is notorious for its uncanny ability to recognise who you associate with in real life. It has mystified and disconcerted Facebook users by showing them an old boss, a one-night-stand, or someone they just ran into on the street.

These friend suggestions go far beyond mundane linking of schoolmates or colleagues. Over the years, I’d been told many weird stories about them, such as when a psychiatrist told me that her patients were being recommended to one another, indirectly outing their medical issues.

What makes the results so unsettling is the range of data sources – location information, activity on other apps, facial recognition on photographs – that Facebook has at its disposal to cross-check its users against one another [..] . People are generally aware that Facebook is keeping tabs on who they are and how they use the network, but the depth and persistence of that monitoring is hard to grasp. And People You May Know, or “PYMK” in the company’s internal shorthand, is a black box.

To try to get a look into that black box – and the unknown and apparently aggressive data collection that feeds it – I began downloading and saving the list of people Facebook recommended to me, to see who came up, and what patterns might emerge. On any given day, it tended to recommend about 160 people, some of them over and over again; over the course of the winter, it suggested more than 1400 different people to me. About 200, or 15% of them, were, in fact, people I knew, but the rest appeared to be strangers.

And then there was Rebecca Porter. She showed up on the list after about a month: An older woman, living in Ohio, with whom I had no Facebook friends in common. I did not recognise her, but her last name was familiar. My biological grandfather is a man I’ve never met, with the last name Porter, who abandoned my father when he was a baby. My father was adopted by a man whose last name was Hill, and he didn’t find out about his biological father until adulthood.

The gist of the tale is clear: Someone being introduced by Facebook to someone (s)he never knew, and may not have wanted to know, or know about him/her.

But we’re still skirting the real problems. Though by now you may want to give it all another thought. The real problem is that by giving out the information on Facebook, even if it all seems completely harmless and innocent to you, you have become Big Brother.

That may sound over the top, and I wouldn’t want to go into popular innuendo that the NSA has started either Facebook or Bitcoin, but it’s obvious that when Google’s and Facebook’s algorithms can dig up so much information on people and the links between them, the intelligence community wants a piece of that. Google/Alphabet’s CEO (he’s leaving that post soon) Eric Schmidt is the head of DOD’s Defense Innovation Board for a reason, and he has been close to the Democratic Party core for years.

It all fits too well to be discarded. It’s inevitable that the NSA, the CIA have recognized the potential of Big Tech for spying on Americans -and everyone else- for a while now. What you write on Facebook may seem harmless, but the algorithms can do more with it than -quite literally- is ‘dreamt of in your philosophy’.

And so Pirate Bay co-founder Peter Sunde is accurate in recognizing the symptoms, but not in diagnosing the underlying affliction. Mark Zuckerberg is not the dictator, and Trump is not in control of the data. They are mere conduits, and the buck stops elsewhere. We’ve centralized all our data to Big Brother.

 

We’ve Centralized All Of Our Data To A Guy Called Mark Zuckerberg

“Everything has gone wrong. That’s the thing, it’s not about what will happen in the future it’s about what’s going on right now. We’ve centralized all of our data to a guy called Mark Zuckerberg, who’s basically the biggest dictator in the world as he wasn’t elected by anyone. Trump is basically in control over this data that Zuckerberg has, so I think we’re already there. Everything that could go wrong has gone wrong and I don’t think there’s a way for us to stop it.”

One of the most important things to realize is that the problem isn’t a technological one. “The internet was made to be decentralized,” says Sunde, “but we keep centralizing everything on top of the internet.” To support this, Sunde points out that in the last 10 years, almost every up-and-coming tech company or website has been bought by the big five: Amazon, Google, Apple, Microsoft and Facebook. The ones that manage to escape the reach of the giants, often end up adding to the centralization.

We don’t create things anymore, instead we just have virtual things. Uber, Alibaba and Airbnb, for example, do they have products? No. We went from this product-based model, to virtual product, to virtually no product what so ever. This is the centralization process going on. Although we should be aware that the current effects of centralization, we shouldn’t overlook that it’s only going to get worse. There are a lot of upcoming tech-based services that are at risk of becoming centralized, which could have a huge impact on our daily lives.

[..] Feeling a bit optimistic, I asked Sunde whether we could still fight for decentralization and bring the power back to the people. His answer was simple. “No. We lost this fight a long time ago. The only way we can do any difference is by limiting the powers of these companies – by governments stepping in – but unfortunately the EU or the US don’t seem to have any interest in doing this.”

The model is absolutely perfect, and it’s not even one that was built on purpose. When Facebook started, Zuckerberg et al were not thinking about 2 billion active users. Nor were they aiming for algorithms that could so pervasively document people’s lives and their connections to others across space and time, or that these people themselves would provide them with the information that can be used to build files on them that can at some point in their lives be used against them, if that is deemed necessary.

And this is just early innings. This is before artificial intelligence and virtual -and/or augmented- reality have really taken off. But when AI is truly unleashed upon the internet, everyone’s seemingly innocent everyday stories as told to family and friends will be a treasure trove when it comes to building the pictures of their lives that are useful to governments and their intelligence agencies.

These platforms are labeled social media, and we might want to think about that label. It’s nice to be able to communicate with people who are not where you find yourself at a given point in time, but there’s a price to pay for that; actually, multiple prices. We’ve likely all found ourselves in situations by now where people act less, not more sociable precisely because of social media; they’re just communicating with their phones, not their immediate surroundings.

Somehow at times that feels a whole new -big- step for mankind: you’re together but you’re not. We are social animals but we attempt to transfer our social lives across space and time to moments and places we’re not at. And we have a gadget that does that for us. That is a puzzling development, and from where I’m sitting a worrying one as well. Somewhere along the same lines as being able to watch ever better photography from ever more remote nature scenes as that nature is being destroyed.

 

Still, few of us would have imagined that when 1984 finally happened, we would ourselves turn out to be Big Brother, but that’s what we are. Or if you want you can insist we’re merely feeding the monster. Same difference. But maybe that too is just a small step for man and a giant leap for mankind. Just like the never before seen quality footage of animals about to go extinct.

Who is anyone of us to judge any of it? It’s confusing, it throws us off everything we were taught is normal and lasting, and that’s only when we pay attention, and it all happens at lightning speed.

One thing we can say though: none of this is innocent. Whatever it is mankind is leaping into, we left innocence behind for good.

 

 

Nov 112017
 
 November 11, 2017  Posted by at 9:26 am Finance Tagged with: , , , , , , , , , , ,  


Henri Cartier Bresson Greenfield, Indiana 1960

 

How Economics Failed the Economy (Haque)
How Did The News Go ‘Fake’? When The Media Went Social (G.)
Global Economy: Communication Breakdown? (R.)
Financial Markets Are Still Blowing Off the Fed (WS)
Is There Any Way Out Of The ECB’s Trap? (Lacalle)
How to Break Out of Our Long National Tax Nightmare (BW)
Tesla’s Junk Bonds Trading Under Water, Could Spell Trouble For Elon Musk (MW)
China Faces Historic Corruption Battle, New Graft Buster Says (R.)
Putin, Trump Agree To Fighting ISIS In Syria, Kremlin Says (R.)
Uber Loses Appeal In UK Employment Rights Case (G.)
Greece Prepares Online Platform for ‘Airbnb Tax’ (GR)
Dijsselbloem: We Saved the Greek Banks but Overlooked Taxpayers (GR)
FOIA Litigation Is Shedding Light On The Case Of Julian Assange (Maurizi)

 

 

Absolute must read.

“Economics failed the economy by telling us that everything that could be traded should be traded, since trade is always beneficial to humankind.”

“..the economic growth that the US has chased so desperately, so furiously, never actually existed at all.”

How Economics Failed the Economy (Haque)

When, in the 1930s, the great economist Simon Kuznets created GDP, he deliberately left two industries out of this then novel, revolutionary idea of a national income : finance and advertising. Don’t worry, this essay isn t going to be a jeremiad against them, that would be too easy, and too shallow, but that is where the story of how modern economics failed the economy and how to understand how to undo it should begin. Kuznets logic was simple, and it was not mere opinion, but analytical fact: finance and advertising don t create new value, they only allocate, or distribute existing value in the same way that a loan to buy a television isn’t the television, or an ad for healthcare isn’t healthcare. They are only means to goods, not goods themselves. Now we come to two tragedies of history.

What happened next is that Congress laughed, as Congresses do, ignored Kuznets, and included advertising and finance anyways for political reasons -after all, bigger, to the politicians mind, has always been better, and therefore, a bigger national income must have been better. Right? Let’s think about it. Today, something very curious has taken place. If we do what Kuznets originally suggested, and subtract finance and advertising from GDP, what does that picture -a picture of the economy as it actually is reveal? Well, since the lion’s share of growth, more than 50% every year, comes from finance and advertising -whether via Facebook or Google or Wall St and hedge funds and so on- we would immediately see that the economic growth that the US has chased so desperately, so furiously, never actually existed at all.

Growth itself has only been an illusion, a trick of numbers, generated by including what should have been left out in the first place. If we subtracted allocative industries from GDP, we’d see that economic growth is in fact below population growth, and has been for a very long time now, probably since the 1980s and in that way, the US economy has been stagnant, which is (surprise) what everyday life feels like. Feels like. Economic indicators do not anymore tell us a realistic, worthwhile, and accurate story about the truth of the economy, and they never did -only, for a while, the trick convinced us that reality wasn’t. Today, that trick is over, and economies grow , but people’s lives, their well-being, incomes, and wealth, do not, and that, of course, is why extremism is sweeping the globe. Perhaps now you begin to see why the two have grown divorced from one another: economics failed the economy.

Now let us go one step, then two steps, further. Finance and advertising are no longer merely allocative industries today. They are now extractive industries. That is, they internalize value from society, and shift costs onto society, all the while, creating no value themselves. The story is easiest to understand via Facebook’s example: it makes its users sadder, lonelier, and unhappier, and also corrodes democracy in spectacular and catastrophic ways. There is not a single upside of any kind that is discernible -and yet, all the above is counted as a benefit, not a cost, in national income, so the economy can thus grow, even while a society of miserable people are being manipulated by foreign actors into destroying their own democracy. Pretty neat, huh?

It was *because* finance and advertising were counted as creative, productive, when they were only allocative, distributive that they soon became extractive. After all, if we had said from the beginning that these industries do not count, perhaps they would not have needed to maximize profits (or for VCs to pour money into them, and so on) endlessly to count more. But we didn’t. And so soon, they had no choice but to become extractive: chasing more and more profits, to juice up the illusion of growth, and soon enough, these industries began to eat the economy whole, because of course, as Kuznets observed, they allocate everything else in the economy, and therefore, they control it.

Read more …

Discuss. Do social media make you depressed?

How Did The News Go ‘Fake’? When The Media Went Social (G.)

The Collins Dictionary word of the year for 2017 is, disappointingly, “fake news”. We say disappointingly, because the ubiquity of that phrase among journalists, academics and policymakers is partly why the debate around this issue is so simplistic. The phrase is grossly inadequate to explain the nature and scale of the problem. (Were those Russian ads displayed at the congressional hearings last week news, for example?) But what’s more troubling, and the reason that we simply cannot use the phrase any more, is that it is being used by politicians around the world as a weapon against the fourth estate and an excuse to censor free speech. Definitions matter. Take, for example, the question of why this type of content is created in the first place.

There are four distinct motivations for why people do this: political, financial, psychological (for personal satisfaction) and social (to reinforce our belonging to communities or “tribes”). If we’re serious about tackling mis- and disinformation, we need to address these motivations separately. And we think it’s time to give much more serious consideration to the social element. Social media force us to live our lives in public, positioned centre-stage in our very own daily performances. Erving Goffman, the American sociologist, articulated the idea of “life as theatre” in his 1956 book The Presentation of Self in Everyday Life, and while the book was published more than half a century ago, the concept is even more relevant today. It is increasingly difficult to live a private life, in terms not just of keeping our personal data away from governments or corporations, but also of keeping our movements, interests and, most worryingly, information consumption habits from the wider world.

The social networks are engineered so that we are constantly assessing others – and being assessed ourselves. In fact our “selves” are scattered across different platforms, and our decisions, which are public or semi-public performances, are driven by our desire to make a good impression on our audiences, imagined and actual. We grudgingly accept these public performances when it comes to our travels, shopping, dating, and dining. We know the deal. The online tools that we use are free in return for us giving up our data, and we understand that they need us to publicly share our lifestyle decisions to encourage people in our network to join, connect and purchase.

But, critically, the same forces have impacted the way we consume news and information. Before our media became “social”, only our closest family or friends knew what we read or watched, and if we wanted to keep our guilty pleasures secret, we could. Now, for those of us who consume news via the social networks, what we “like” and what we follow is visible to many – or, in Twitter’s case, to all, unless we are in that small minority of users who protect their tweets. Consumption of the news has become a performance that can’t be solely about seeking information or even entertainment. What we choose to “like” or follow is part of our identity, an indication of our social class and status, and most frequently our political persuasion.

Read more …

The Fed is not the biggest player anymore.

Global Economy: Communication Breakdown? (R.)

A flattening of government bond yield curves that may presage an economic downturn could prompt verbal interventions in the coming week by central bankers still struggling to hit this cycle’s inflation targets. ECB chief Mario Draghi, U.S. Fed Chair Janet Yellen, BOJ Governor Haruhiko Kuroda and BOE head Mark Carney will form an all-star panel on Tuesday at an ECB-hosted conference in Frankfurt. The subject? “Challenges and opportunities of central bank communication.” Curve-flattening on both sides of the Atlantic, but more markedly in the United States, suggests investors have doubts over the future path of inflation and may be starting to price in a downturn just as the global economy picks up speed.

Since the Fed began raising rates in 2015, the difference between long- and short-term U.S. yields has shrunk to levels not seen since before the 2008 financial crisis, reaching 67 basis points – its flattest in a decade – in the past week. That partly reflects uncertainty about the passage of a Republican-sponsored bill to cut U.S. taxes, which has hauled down longer-term projections of inflation while expectations for upcoming rate increases push short-term yields higher. With curve-flattening typically signaling a muted outlook for both growth and inflation, the trend suggests investors see a risk that the Fed’s current monetary tightening cycle will start to slow the world’s biggest economy. A flatter curve, which makes lending less profitable, also poses a risk to the banking sector, nursed back to fragile health by central banks after it nearly collapsed a decade ago. But with crisis-era policies still largely in place, how would central banks cushion the impact of a downturn?

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Because of Draghi and Kuroda.

Financial Markets Are Still Blowing Off the Fed (WS)

There has been a lot of hand-wringing about junk bonds this week, that they have gotten clobbered, that losses have been taken, that this is a predictor of where stocks are headed, etc., etc., because after a steamy rally in junk-bond prices from the February 2016 low, there has now been a sell-off. When bond prices fall, bond yields rise by definition. And the average yield of BB-rated junk bonds – the upper end of the junk-bond spectrum – did this:

No one likes to lose money, and junk bonds did lose money this week, an astounding event, after all the easy money that had been made since early February 2016. But how far have yields really spiked? The chart below shows the same BofA Merrill Lynch US High Yield BB Effective Yield index, but it puts that “spike” into a three-year context:

For further context, the BB yield spiked – a true spike – to over 16% during the Financial Crisis, as bond prices crashed and as credit froze up. Currently, at 4.36%, the average BB yield is off record lows, but it’s still low, and junk bond prices are still enormously inflated, given the inherent credit risks, and have a lot further to fall before any hand-wringing is appropriate. The low BB yield means that risky companies with a junk credit rating can still borrow money at near record low costs in a world awash in global liquidity that is trying to find a place to go. This shows that “financial conditions” are very easy. The market has now four Fed rate hikes under its belt and the QE unwind has commenced. Another rake hike is likely in December. Tightening is under way. By “tightening” its monetary policy, the Fed attempts to tighten financial conditions in the markets. That’s its goal.

But that hasn’t happened yet. While short-term yields have responded to the rate hikes, longer-term yields are now lower than they’d been at the time of the rate hike in December 2016. Stocks have rocketed higher. Volatility indices are near record lows. And various yield spreads have narrowed sharply – for example, the difference between the 10-year Treasury yield and the 2-year Treasury yield is currently just 0.73 percentage points. In other words, raising money is easy and cheap. And “financial stress” in the markets, as measured by the St. Louis Fed’s Financial Stress Index, has just hit a record low. In the chart below, the red line (= zero) represents “normal financial market conditions.” Values below the red line indicate below-average financial market stress. Values above the red line indicate higher than average financial stress. The latest reading of the index dropped to -1.60, by a hair below the prior record low in 2014:

In other words, financial conditions have never been easier despite the current series of rate hikes, the Fed’s “balance-sheet normalization, and the hand-wringing about junk bonds this week. The chart below shows the Financial Stress Index going back to 2014. In that time frame, all values are below zero. Financial stress in the markets was heading back to normal in late 2015 and early 2016, as a small sector of the total markets – energy junk-bonds – were getting crushed and as the S&P 500 index experienced a downdraft. But in early February 2016, everything turned around:

Read more …

Europe’s problem is huge: “..the ECB repurchase program exceeds net sovereign bond issuances in the eurozone by more than seven times. Throughout the US QE (quantitative expansion) of the Federal Reserve, it never reached 100% of net issuances.” Thing is, it’s Draghi who keeps the global economy going.

Is There Any Way Out Of The ECB’s Trap? (Lacalle)

The ECB faces the Devil’s Alternative that Frederick Forsyth mentioned in one of his books. All options are potentially risky. Mario Draghi knows that maintaining the so-called stimuli involves more risks than benefits, but also knows that eliminating them could make the eurozone deck of cards collapse. Despite the massive injection of liquidity, he knows that he can not disguise political risks such as the secessionist coup in Catalonia. The Ibex reflects this, making it clear that the European Central Bank does not print prosperity, it only puts a floor to valuations. The ECB wants a weak euro. But it is a game of juggling to pretend a weak euro and at the same time a strong economy. The EU countries export mostly to themselves. Member countries sell more than two-thirds of their goods and services to other countries in the eurozone.

Therefore, the more they export and their economies recover, the stronger the euro, and with it, the risk of losing competitiveness. The ECB has tried to break the euro strength with dovish messages, but it has not worked until political risk reappeared. With the German elections and the prospect of a weak coalition, the results of the Austrian elections and the situation in Spain, market operators have realized – at last – that the mirage of “this time is different “in the European Union was simply that, a mirage. A weak euro has not helped the EU to export more abroad. Non-EU exports from the member countries have been stagnant since the monetary stimulus program was launched, even though the euro is much weaker than its basket of currencies compared to when the stimulus program began. The Central Bank Trap. This shows that export growth is not achieved by artificial subsidies such as a devaluation, but from added value, something that the EU has stopped looking for.

Escape From The Central Bank Trap explains that the ECB has got itself in a problem that is not easy to solve. The first evidence is that it should have finished its stimuli months ago according to its own plan, but is unable to do it. The second is that, with more than a trillion euros of excessive liquidity, the ECB keeps a figure of repurchases that were clearly unnecessary and that have resulted in the figure of excess liquidity being multiplied by more than ten. The third is that perverse incentives have taken over the European economic policy. Risks are relevant. This week I had the opportunity to speak at the Federal Reserve Bank of Houston and I explained that the ECB repurchase program exceeds net sovereign bond issuances in the eurozone by more than seven times. Throughout the US QE (quantitative expansion) of the Federal Reserve, it never reached 100% of net issuances.

Now that the ECB “reduces” these repurchases to 30 billion euros per month, it will continue to be more than 100% of net issuances. What does that mean? That the US always maintained a healthy secondary market alive, which guaranteed that there would not be huge risks of collapse when tapering started, because the Federal Reserve bought less than what was issued, paying attention to the market accepting the valuations of bonds and financial assets. By extending the repurchase program, the ECB admits that it does not know if there is a secondary market that would buy European government bonds at current yields. Ask yourself a question. Would you buy bonds from a heavily indebted state that has stopped its reform impulse with a 10-year yield of less than 2%, if the ECB did not buy them back? Exactly. No.

Read more …

What’s needed is a whole overthrow of taxation as we know it. The Paradise Papers point to where the changes should be.

How to Break Out of Our Long National Tax Nightmare (BW)

President Donald Trump wanted to call it the Cut Cut Cut Act. Congressional Republicans settled on the less catchy and no more descriptive Tax Cuts and Jobs Act. What the legislation that began making its way through the U.S. House of Representatives in early November actually would do is sharply reduce taxes for business while rearranging the personal income tax with a mix of cuts and increases. House Speaker Paul Ryan called the bill “a game changer for our country.” The president said it was “the rocket fuel our economy needs to soar higher than ever before.” That’s a lot to expect from some changes in the tax code. But then, here in the U.S. we’ve come to expect big things of our income taxes. On the right, cutting them has been portrayed for decades as a near-magical growth elixir. On the left, raising or rearranging them is seen as essential to making society fairer.

And across the political spectrum, economic and social policies have come to rely on carving credits, deductions, and other exceptions out of the tax code to favor this or that behavior. It can sometimes feel, in fact, as if “we have lost sight of the fact that the fundamental purpose of our tax system is to raise revenues to fund government.” That was the lament of President George W. Bush’s Advisory Panel on Federal Tax Reform in November 2005. But this bipartisan group of worthies couldn’t agree on how to raise those revenues either, instead offering two plans with differing priorities. Both were mostly ignored by Congress at the time, though some of the recommendations—such as shrinking the tax deductions for mortgage interest and state and local taxes—have found their way into this year’s bill. Overall, though, it appears that the legislation will only make it harder to raise revenue to fund government.

The House and Senate have passed budget resolutions clearing the way for $1.5 trillion in revenue losses over the next decade from the tax changes. That’s $150 billion a year to add to a federal deficit that totaled a sinister-sounding $666 billion, 3.5% of GDP, in the just-ended fiscal year. All of which is a longer way of saying that we’ll almost certainly be back at this once again in the all-too-foreseeable future, trying to figure out a better way to fund the government. Since 1981, the year of President Ronald Reagan’s big tax cut, Congress has passed and presidents have signed 55 bills that the Urban-Brookings Tax Policy Center counts as “major” tax legislation. During the prior 36 years there had been just 18. [..] Ominously, most previous U.S. tax eras ended with major wars that required big increases in government revenue. Let’s hope it doesn’t take that to break us out of the cut-reform-increase-repeat loop we’re currently trapped in.

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This will make the next debt round a lot harder, and more expensive.

Tesla’s Junk Bonds Trading Under Water, Could Spell Trouble For Elon Musk (MW)

Tesla’s first-ever pure corporate bonds are trading under water, boding ill for the Silicon Valley car maker’s next attempt to tap capital markets. Tesla sold $1.8 billion in the senior notes in August at a yield of 5.300%, at the height of excitement about the Model 3 and expectations the sedan’s production ramp would run as smoothly as Chief Executive Elon Musk had predicted. That same month, Tesla shares rose 10% to mark their last monthly gain this year so far. The stock lost 4.2% in September and 2.8% in October. The stock is down 9% so far in November, on the heels of a quarterly miss earlier in the month and news that the company has further pushed out its Model 3 production targets. “Third-quarter results put some pressure on the cash flow needs,” said Efraim Levy, an analyst with CFRA Research.

The wider-than-expected quarterly loss and production delays “makes it harder for them to get a sweeter deal than they had in the past,” on capital raising, be it when selling bonds or equity, he said. The 5.300% notes, which mature in 2025, were trading at 94 cents on the dollar on Friday to yield 6.287%, according to trading platform MarketAxess. On a spread basis, they were trading at 393 basis points above comparable Treasurys. The bonds fell under par within a week of issuance, but were holding above 97 cents for much of October. Wall Street has long seemed to accept that Tesla’s high capital expenses and negative free cash flow will be the reality for the company at least in the short term.

But the weak performance of the bonds may be a sign that bond investors, at least, are starting to disbelieve Tesla’s growth story and will be looking for higher premiums to take on higher risk, said Trip Miller, a managing partner at hedge fund, Gullane Capital LLC. That higher cost of borrowing will have its own negative implications, he said. “Maybe the dam is starting to break for Tesla,” Miller said. Gullane does not have a position in Tesla because “their balance sheet is very, very troublesome for us,” he said.

Read more …

Everyone’s fighting corruption these days. Time for us to start doing the same?

China Faces Historic Corruption Battle, New Graft Buster Says (R.)

China must win its battle against corruption or face being erased by history, its new top graft buster said in an editorial on Saturday, underscoring the ruling Communist party’s focus on eliminating corrupt behaviour. Zhao Leji, appointed to the new seven-member politburo standing committee last month and tasked to lead president Xi Jinping’s signature war on corruption, wrote in the state-run People’s Daily that failure would lead to the party’s downfall. “If our control of the party is not strong and party governance is not strict, then the party won’t be able to avoid being erased by history and the historic task the party carries will not be able to be fulfilled,” Zhao wrote. Xi, like others before him, has warned corruption is so serious it could lead to the end of the party’s grip on power.

The president’s corruption fight has ensnared more than 1.3 million officials. At last month’s five-yearly party congress he said it would continue to target both “tigers” and “flies“, a reference to elite officials and ordinary bureaucrats. Zhao, formerly a low-profile official, replaced Wang Qishan, whose sweeping anti-graft campaign had made him China’s second most-powerful politician. “The facts tell us and warn us that the party’s position as the top political leader and power is the foundation of our political stability, economic development, national unity and social stability,” Zhao wrote. Zhao leads the central commission for discipline inspection, having previously been in charge of the party’s powerful organisation department, which is in charge of personnel decisions. He added that there would be no tolerance of people who “just do what they want to do” and ignore orders or carry on with banned behaviours such as trying to get around policy decisions.

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It’s crazy these people are kept from talking.

Putin, Trump Agree To Fighting ISIS In Syria, Kremlin Says (R.)

Russian President Vladimir Putin and U.S. President Donald Trump agreed a joint statement on Syria on Saturday that said they would continue joint efforts in fighting Islamic State until it is defeated, the Kremlin said. The White House did not immediately respond to questions about the Kremlin announcement or the conversation the Kremlin said took place on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in the Vietnamese resort of Danang. The Kremlin said the statement on Syria was coordinated by Russian Foreign Minister Sergei Lavrov and U.S. Secretary of State Rex Tillerson especially for the meeting in Danang. Putin and Trump confirmed their commitment to Syria’s sovereignty, independence and territorial integrity and called on all parties to the Syrian conflict to take an active part in the Geneva political process, it said.

Moscow and Washington agree there is no military solution to the Syrian conflict, according to the text of the joint statement published on the Kremlin’s website. Television pictures from Danang showed Putin and Trump chatting – apparently amicably – as they walked to the position where the traditional APEC summit photo was being taken at a viewpoint looking over the South China Sea. Earlier pictures from the meeting show Trump walking up to Putin as he sits at the summit table and patting him on the back. The two lean in to speak to each other and clasp each other briefly as they exchange a few words. Although the White House had said no official meeting was planned, the two also shook hands at a dinner on Friday evening. Trump has shown little appetite for holding talks with Putin unless there is some sense that progress could be made on festering issues such as Syria, Ukraine and North Korea.

Read more …

“Companies are hiding behind technology, bogusly classifying people as self-employed so they can get away from paying minimum wage.”

Uber Loses Appeal In UK Employment Rights Case (G.)

The ride-hailing firm Uber has lost its appeal against a ruling that its drivers should be classed as workers with minimum-wage rights, in a case that could have major ramifications for labour rights in the growing gig economy. The US company, which claims that drivers are self-employed, said it would launch a further appeal against the Employment Appeal Tribunal decision, meaning the case could end up in thesupreme court next year. Drivers James Farrar and Yaseen Aslam won an employment tribunal case last year after arguing they should be classified as workers, citing Uber’s control over their working conditions. Uber challenged the ruling at the tribunal in central London, warning that it could deprive riders of the “personal flexibility they value”. It claims that the majority of its drivers prefer their existing employment status.

The Independent Workers’ Union of Great Britain (IWGB), which backed the appeal, said drivers will still be able to enjoy the freedoms of self-employment – such as flexibility in choosing shifts – even if they have worker status. The union said the decision showed companies in the gig economy – which involves people on flexible working patterns with irregular shifts and minimal employment rights – have been choosing to “deprive workers of their rights”. Farrar said: “It is time for the mayor of London, Transport for London and the transport secretary to step up and use their leverage to defend worker rights rather than turn a blind eye to sweatshop conditions.” “If Uber are successful in having this business model, obliterating industrial relations as we know them in the UK, then I can guarantee you on every high street, in retail, fast food, any industry you like, the same thing will go on.”

Farrar said he was willing to fight the case all the way to the supreme court if necessary but called on Uber’s new chief executive, Dara Khosrowshahi, to intervene instead. “We’ve asked to meet him when he came to London and Uber declined to do that, which tells you everything.” Aslam said: “Today is a good day for workers, we made history. The judge confirmed that Uber is unlawfully denying our rights.” “It’s about making sure workers across the UK are protected. Companies are hiding behind technology, bogusly classifying people as self-employed so they can get away from paying minimum wage. That can’t be allowed to happen.”

Read more …

Good.

Greece Prepares Online Platform for ‘Airbnb Tax’ (GR)

Greece is cracking down on undeclared income of owners leasing residential lodgings on a short-term basis. Tax authorities are creating an online platform where Airbnb lodged properties should be declared, or face a hefty fine. According to a report in Naftemporiki, registration will be mandatory and it will provide property owners with a certification number, which should be declared on any digital platform, website and social media where it is advertised – including the Airbnb website. The platform will demand the declaration of the property, the names of the renters and the duration of the lease, or otherwise face a fine of up to €5,000. Naftemporiki says that income from short-term residential leasing will be taxed based on income.

Specifically, for a taxpayer with a yearly income of up to 12,000 euros, the tax rate for income derived from short-term residential leasing will reach 15%; 35% for a taxpayer with between 12,000 to 35,000 euros in annual income. Above an annual income of 45,000 euros, a taxpayer’s income from short-term residential leasing will reach the astronomical rate of 45%, i.e. nearly one in two euros goes to the state. Tax authorities aim to collect revenue from people who put their property for lease on Airbnb, as many crisis-hit Greeks try to make ends meet by renting their homes to foreign visitors. It is estimated that three million tourists will be hosted in Greek homes in 2017.

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He’s lying. They didn’t act to save the Greek banks, but the German and French ones. And he knows it.

Dijsselbloem: We Saved the Greek Banks but Overlooked Taxpayers (GR)

Outgoing Eurogroup chief Jeroen Dijsselbloem acknowledged on Thursday that Greece’s creditors put too much emphasis on saving the banks at the expense of ordinary taxpayers. In an exchange of views on Greece in the European Parliament’s Employment and Social Affairs Committee, Dijsselbloem was asked if he agrees with the view that Greece’s first bailout programme was designed to support the banks. Dijsselbloem noted that “banks were the biggest problem in all countries,” at the start of the crisis. “We had a banking crisis, a fiscal crisis and we spent a lot of the tax-payers’ money – in the wrong way, in my opinion – to save the banks so that the people criticizing us and saying that everything was being done for the benefit of the banks were to some extent right,” he said.

“This was the reason why we introduced the banking union and the introduction of higher standards, better supervision and a reform and rescue framework when banks have losses…Precisely so that we don’t find ourselves in that situation again,” Dijsselbloem added. Dijsselbloem also claimed that the labour market reforms adopted by Greece had brought “clear improvements” that were reflected in the latest unemployment figures in the country. Referring to the programme as a whole, the outgoing Eurogroup president said the economic situation in Greece had improved as a result of the reforms and stressed the need to conclude the third review on time.

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This story gets darker fast. The UK deleted a lot of documents relvant to the Assange accusations AND told the Swedes not to talk to him in London.

FOIA Litigation Is Shedding Light On The Case Of Julian Assange (Maurizi)

The siege by Scotland Yard agents around the red brick building in Knightsbridge has been gone for two years now. And with Sweden dropping the rape investigation last May, even the European arrest warrant hanging over Julian Assange’s head like the sword of Damocles has gone. Many expected the founder of WikiLeaks to leave the Ecuadorian Embassy in London, where he has been confined for over five years, after spending one and a half years under house arrest. But Assange hasn’t dared leave the Embassy due to concern he would be arrested, extradited to the US and charged for publishing WikiLeaks’ secret documents.

Julian Assange’s situation is unique. Like him and his work or not, he is the only western publisher confined to a tiny embassy, without access to even the one hour a day outdoors maximum security prisoners usually receive. He is being arbitrarily detained, according to a decision by the UN Working Group on Arbitrary Detentions in February 2016, a decision which has completely faded into oblivion. December 7th will mark seven years since he lost his freedom, yet as far as we know, in the course of these last 7 years no media has tried to access the full file on Julian Assange.

That is why next Monday, La Repubblica will appear before a London Tribunal to defend the press’ right to access the documents regarding his case, after spending the last two years attempting Freedom of Information requests (FOI) without success. It is entirely possible, however, that we will never be able to access many of these documents, as last week London authorities informed us that “all the data associated with Paul Close’s account was deleted when he retired and cannot be recovered”. A questionable choice indeed: Close is the lawyer who supported the Swedish prosecutors in the Swedish investigation on Julian Assange from the beginning. What was the rationale for deleting historical records pertaining to a controversial and still ongoing case?

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