Edward Hopper Le Bistro or The Wine Shop 1909
Let’s wind it down in an orderly fashion and call it a day. This is hopeless.
Americans expanded their credit card debt by $26 billion in the last quarter of 2018, making it reach $870 billion—a record. “The increase in credit card balances is consistent with seasonal patterns but marks the first time credit card balances re-touched the 2008 peak,” the Federal Reserve Bank of New York stated in a quarterly report (pdf) released Feb. 12. The credit card debt rose for the 24th consecutive quarter; and balances sliding into 90 or more days of delinquency have increased since 2017. Total household debt increased by $32 billion in the last quarter and finished the year at more than $13.5 trillion. The largest chunk of that sum is mortgages at $9.1 trillion—virtually unchanged from the quarter before. Student loans stood at nearly $1.5 trillion and auto loans at almost $1.3 trillion.
Americans hold about 480 million credit cards, which is about 100 million more than in 2010, but still a bit fewer than at the precipice of the 2008 recession. Consumer spending accounts for two-thirds of growth in the world’s largest economy and is expected to hold strong this year. However, credit inquiries, which are one sign of consumer demand, slipped in the second half of 2018 to the lowest level recorded by the New York Fed. Another signal of weaker demand, the closing of credit cards and other accounts, jumped to its highest level since 2010. [..] The report also showed that Americans have continued to turn away from home equity lines of credit, or HELOC, which can free up funds for other purchases. HELOC balances dropped to $412 billion in the fourth quarter, the lowest level in 14 years.
And while we’re at it let’s scrap the Fed.
The U.S. Federal Reserve said on Wednesday it would no longer flunk banks based on operational or risk management lapses during its annual health check of the country’s domestic banks. The “qualitative” portion of the 2019 test, however, will still apply to the U.S. subsidiaries of five foreign banks subject to the annual exam. The move, which is a big win for major banks, such as Goldman Sachs, Morgan Stanley and JP Morgan, Bank of America and Citigroup, forms part of a broader effort by the Fed to overhaul its annual “stress-testing” process, which the industry has long criticized as too onerous and opaque. Since the 2007-09 global financial crisis, the Fed has put the country’s lenders through strict annual tests to see whether they would have enough capital to withstand a major economic downturn.
For the largest lenders, that test also included a so-called “qualitative objection,” that gives the Fed the discretion to fail banks due to risk management or operational failures, even if they have sufficient capital. Most banks that have failed the tests in the past stumbled on the qualitative objection. Banks that receive an objection from the Fed are required to adjust their capital distribution plans. [..] The Fed will still examine domestic banks for operational and risk management problems, but will address them through enforcement actions rather than a public flunking. The U.S. subsidiaries of five foreign lenders – Deutsche Bank, Credit Suisse, UBS, Barclays and TD Bank – would also still be subject to the qualitative objection.
And scrap the ECB and BOJ too. Their only goal is to preserve zombies.
BTW, does anyone seriously think it’s not too late yet for Europe? Asking for a friend.
The eurozone is beginning to resemble Japan with its low-growth and low-inflation environment, coupled with still very loose monetary policy, according to economists at ING. This raises questions about the European Central Bank’s tool kit and firing power. Interest rates haven’t gone up in either the eurozone or Japan since the aftermath of the global financial crisis. Conversely, the Federal Reserve has raised rates nine times since the crisis years, presumably giving it room to cut them again should the economy need a boost. The Bank of Japan is considered the most hesitant of its peers to normalize monetary policy. And already since the mid-1990s, Japan has been struggling with a high public debt ratio and stubbornly low inflation and growth rates.
None of that bodes well for a hawkish central bank approach. The eurozone looks like it entered a similar trend of late, said ING economists Carsten Brzeski and Inga Fechner, one day ahead of the European Central Bank’s next policy update. “An end to current unconventional monetary policy, i.e. the negative deposit rate and ample liquidity, is not insight and the ECB is expected to do everything it can to avoid an unwarranted tightening of its monetary stance.” “Last year, Japan’s debt-to-GDP ratio stood at 238%, and since 1994, headline inflation has been negative for almost half of the time. This trend has also emerged in the eurozone in recent years,” said Brzeski and Fechner, pointing at Greece, as well as Spain and Italy, in the aftermath of the European sovereign debt crisis. Though deflationary risks have disappeared in the eurozone, consumer prices haven’t exactly been soaring.
The power of US intelligence.
Huawei has accused the US of hacking its computers in a defiant press conference where the Chinese telecommunications giant announced it had taken legal action in a Texas court to overturn a US ban. Huawei’s rotating chairman Guo Ping said in China that the US Congress had failed to produce any evidence to justify its ban which prevents US agencies, private companies that deal with US agencies and recipients of US loans or grants from using Huawei’s gear. The Trump Administration has accused Huawei of being a national security risk because it was a tool of the Chinese government. But Guo fired back, saying the US “has hacked our servers and stolen our emails and source code”.
“Despite this, the US has never produced any evidence supporting their allegations that Huawei poses a cyber security threat.” He added: “The US is trying to block us from 5G markets in other countries.” Guo said that a section of the US National Defense Authorisation Act that names Huawei not only damages the company’s reputation but stops Huawei from servicing customers outside the US. US Secretary of State Mike Pompeo has publicly urged other countries, particularly in Europe, to ban Huawei from 5G if they want to continue to deal with the US. Germany and Britain are due to make decisions this month.
They’ll simply shift from collusion to -now- obstruction to yet another term. Just as long as it takes.
Well, we’re off on the march to impeachment, as we predicted last year even as Democrats said it wasn’t on their minds. With Chairman Jerry Nadler’s subpoena swarm from House Judiciary this week, and his assertions that President Trump obstructed justice, the articles of impeachment are apparently awaiting only the collection of the readily available details to fill in the blanks. “Do you think the President obstructed justice?” asked ABC’s George Stephanopoulos on Sunday. “Yes, I do,” replied Mr. Nadler. “It’s very clear that the President obstructed justice. It’s very clear—1,100 times he referred to the Mueller investigation as a witch hunt, he tried to—he fired—he tried to protect [Michael] Flynn from being investigated by the FBI. He fired [FBI director Jim] Comey in order to stop the Russian thing, as he told NBC News.”
Credit Mr. Nadler for candor that Democrats didn’t display when they campaigned last year. Then they talked only about holding the President “accountable.” Now they claim they already have enough to impeach Mr. Trump, though as Mr. Nadler admitted Sunday, “you have to persuade enough of the opposition party voters, Trump voters . . . that you’re not just trying to steal the last—to reverse the results of the last election.” That may be harder than he imagines, and not only because of Mr. Nadler’s Freudian slip there of “steal.” Based on the public evidence so far, Mr. Trump hasn’t obstructed justice in any of the examples Mr. Nadler cited. Mr. Nadler wants to turn the President’s exercise of his normal constitutional powers into impeachable offenses.
The case against Mr. Nadler’s obstruction theory has been made in these pages by former Attorney General Michael Mukasey and appellate lawyer and our contributor David Rivkin. Attorney General William Barr also made the case in his 2018 memo to the Justice Department when he was still in private life. A President can obstruct justice while in office but only if he is committing a per se illegal offense. That is, if he suborns perjury or destroys evidence, or commits “any act deliberately impairing the integrity or availability of evidence,” as Mr. Barr put it. Presidents Richard Nixon and Bill Clinton committed such acts in Mr. Barr’s view, but Mr. Trump has not as far as we can see.
On the other hand, a President cannot obstruct justice when he takes actions that are consistent with his Article II powers under the Constitution. That includes in particular firing inferior executive-branch officers such as Mr. Comey. Such acts may be politically stupid, but they aren’t obstruction.
Less than 100% truthful.
Michael Cohen, a former lawyer for President Donald Trump, directed his attorney last spring to inquire about the possibility of a presidential pardon, weeks after federal agents raided his properties, Cohen’s lawyer said Wednesday. The Wall Street Journal previously reported that Stephen Ryan, Cohen’s attorney at the time, discussed the possibility of a pardon with lawyers for Trump in the weeks after the Federal Bureau of Investigation in April raided Cohen’s home, office and hotel room. The president’s lawyers, including Jay Sekulow, Rudy Giuliani and Joanna Hendon, dismissed the idea of a pardon at the time, people familiar with the discussions said.
But at least one of them, Giuliani, left open the possibility that the president could grant Cohen one in the future, they said. In testimony before the House Oversight Committee last week, Cohen said: “I have never asked for, nor would I accept, a pardon from Mr. Trump.” Lanny Davis, a lawyer for Cohen, said Wednesday that in the months after the FBI raid, Cohen was open to a pardon from the president. “During that time period, he directed his attorney to explore possibilities of a pardon at one point with Trump lawyer Rudy Giuliani as well as other lawyers advising President Trump,” Davis said. He referred to the discussions with the president’s lawyers as the “ongoing ‘dangling’ of a possible pardon.”
It’s all about money, nothing else.
The Democratic Party said Wednesday it will not allow Fox News to host any of its primary candidate debates, after published revelations suggested the network is a “propaganda” vehicle for President Donald Trump. National Committee (DNC) chairman Tom Perez said a story in this week’s New Yorker magazine on the White House’s apparently close relationship with the channel prompted the decision. “Just to be clear, Fox News will not serve as a media partner for the 2020 Democratic primary debates,” Perez said on Twitter. “Recent reporting in the New Yorker on the inappropriate relationship between President Trump, his administration and Fox News has led me to conclude that the network is not in a position to host a fair and neutral debate for our candidates,” he added in a statement to The Washington Post.
News of the move enraged Trump, who suggested on Twitter he would “do the same thing with the Fake News Networks and the Radical Left Democrats” — despite having no authority over Republican debate broadcasting rights. Trump often refers to CNN, The New York Times, The Washington Post and MSNBC as “fake news.” US presidential debate and primary debate broadcast rights are coveted prizes for American media outlets. The events traditionally draw broad viewership, and the series of debates beginning this year – aimed at winnowing the Democratic field of over a dozen candidates – will likely have large television audiences.
I’m thinking if they haven’t so far, what are the odds?
The UK has been urged to table fresh proposals within the next 48 hours to break the Brexit impasse. EU officials said they would work non-stop over the weekend if “acceptable” ideas were received by Friday to break the deadlock over the Irish backstop. The UK has said “reasonable” proposals to satisfy MPs’ concerns about being tied to EU rules had already been made. It comes as Jeremy Corbyn has met with Tory MPs to discuss possible alternatives to the PM’s deal. The Labour leader held talks with ex-Tory minister Nick Boles and Sir Oliver Letwin, who favour a closer, Norway-style relationship with the EU.
He said he had discussed the so-called “Common Market 2.0 option” – which would see the UK remain in the EU’s single market by staying part of the European Economic Area – but would not commit to backing it at this stage. There have been few visible signs of progress ahead of Parliament’s second vote on the Brexit deal next Tuesday. MPs emphatically rejected the terms of withdrawal negotiated by Theresa May in January. If they do so again, they will get to choose between leaving without a deal or deferring the UK’s exit date from the EU beyond the scheduled 29 March. The PM is seeking legally-enforceable changes to the backstop – an insurance policy designed to prevent physical checks on the border between Northern Ireland and the Republic of Ireland.
Telegraph today: “Brexit deal ‘will be defeated by 100 votes’, ministers believe, after talks in Brussels collapse..”
Downing Street has insisted the meaningful vote on Theresa May’s Brexit deal will go ahead as promised on Tuesday, despite negotiations in Brussels stumbling. The prime minister’s spokesman repeated the line on Wednesday that the government is determined to secure “legally binding changes” to the Irish backstop, despite the attorney general, Geoffrey Cox, returning empty-handed from the talks. Shortly before leaving Brussels, he conceded “strong views” had been expressed during three hours of “robust” discussions. Downing Street said the talks had been “difficult”, but stressed the vote would take place on Tuesday, as committed by May.
If it is lost, MPs will vote on successive days on whether to block a no-deal Brexit and whether to extend the departure date. With it increasingly being assumed No 10 will not secure significant EU concessions on the backstop, May is expected to try to sell her plan to MPs and the public later in the week, potentially with a speech. There are no plans as yet for the prime minister or Cox to return to Brussels, but it is understood this could happen if required. Sunday night is the final deadline for any changes, as the government needs to publish and print copies of deal documents on Monday, and publish the motion MPs will then vote on.
[..] Cabinet ministers are pessimistic about the prospects of wooing enough waverers in parliament to win the second meaningful vote. May will then come under intense pressure to offer MPs a free vote on a no-deal Brexit, with her cabinet deeply divided. The opportunity to vote on this was only secured after scores of frontbenchers made it clear they were willing to resign, and the cabinet ministers Amber Rudd, Greg Clark and David Gauke wrote to the Daily Mail rejecting the idea of a no-deal departure.Senior EU diplomats said the bloc’s deputy chief negotiator, Sabine Weyand, offered a “gloomy” analysis of the talks. According to a diplomatic note, Weyand told the ambassadors: “Cox’s asks are going well beyond where Barnier can go.”
“..49.1 percent of households have a main pension as their primary source of income..”
The Greek economy’s scars from the decade-long financial crisis and the internal devaluation are more than obvious. Despite the slight improvement in certain income-related indexes, three in 10 households get by on an annual income of less than 10,000 euros, while pensions comprise the main source of income for almost half of all households, according to a survey published on Wednesday by the Institute of Small Enterprises of the Hellenic Confederation of Professionals, Craftsmen & Merchants (GSEVEE). In this first survey after the completion of the bailout programs, GSEVEE found that 43.9 percent of households reported a decline in their incomes last year compared to 2017.
Almost half of the households surveyed (48.9 percent) reported income stability, up from one in three (35.6 percent) in 2017, while 7.1 percent said they had seen an increase, up from just 2 percent in 2017. At the same time, the share of households on an annual income of less than 10,000 euros remained quite high, at 31.7 percent, against 34.2 percent in 2017. The biggest income bracket is that of households with earnings of between 10,000 and 18,000 euros per year, accounting for 39.8 percent in 2018 against 37.5 percent in 2017. This illustrates the shift of a number of households that were in the bottom bracket to a higher one; however, it also points to declines in the incomes of some households that in 2017 had been in the over-18,000 euros per annum bracket.
The bulk of Greek households find themselves in the bottom two income tiers. More than one in eight (12.7 percent) households say their incomes do not suffice to cover their basic needs, and more than half (52.5 percent) say their monthly income is not enough to carry them through all 30 days, sufficing instead for an average of just 19 days per month. All this is explained by the fact that 49.1 percent of households have a main pension as their primary source of income, even if that has been significantly reduced in recent years.
Neoliberalism is killing the EU as a project, maybe not in Germany, but certainly in Italy and Greece. Still, labeling a basic income project ‘welfare’ is leading, Reuters.
Italy’s flagship welfare reform kicked off in busy but orderly fashion on Wednesday as thousands of poor and unemployed people applied in post offices and tax assistance centers for the “citizens’ income” scheme. The populist 5-Star Movement, which governs with the right-wing League and has long promoted the measure, hopes it will lift its flagging fortunes ahead of European Parliament elections in May. Despite a steady flow of applicants, warnings of chaos and long queues proved misplaced, as many people appeared to heed advice not to sign up on the scheme’s first day.
“This is so helpful, it will give me some breathing space to get to the end of each month,” said 36-year-old Svetlana Guerra as she left a small tax assistance center (CAF) in a densely populated quarter of south-eastern Rome. Guerra, a Ukrainian-born widow who has lived in Italy for 19 years and survives thanks to odd jobs paid under the counter, said she expected the citizens’ income to give her about 280 euros ($315) per month to help her pay her rent. Guerra is one of millions struggling to make ends meet in a country in its third recession in 10 years and where the economy has barely grown since the start of the century.
Italians in absolute poverty, defined as not having enough money to buy a basket of basic goods and services, rose to 5.1 million in 2017, according to statistics office ISTAT. That is a more than threefold increase in a decade. Italy has traditionally had a generous pension system and offered limited-term state benefits for those laid off from work, but until last year it was virtually unique among rich countries in having no means-tested welfare scheme.
The previous center-left government aimed to fill that gap, but the “inclusion income” program it launched ahead of elections a year ago set aside just 2 billion euros and was widely deemed inadequate. The citizens’ income, a rallying call for 5-Star since its foundation in 2009, will cost 7 billion euros this year and is expected to go initially to 2.7 million people, according to ISTAT. Critics say Italy’s strained public finances cannot afford it. The 5-Star Movement was easily the biggest party at the March 2018 national election but has seen its support slide since then and been overtaken in opinion polls by the League.
Make America Great Again must start with its wildlife. That’s much greater than millions working bullshit jobs where they drive an hour a day from the burbs. Nothing great about that.
First, define greatness.
Attempting to locate one of the rarest animals on the planet, US government scientist Joe Madison pointed an antiquated VHF tracking antenna at a tangle of thick vegetation and twiddled some dials on the receiver. A red wolf, judging by the beeps, was in the vicinity but well-hidden. “Did you hear that beep? That’s a six-year-old male we just heard,” said Madison, a Tennessean with a sandy-coloured beard who is manager of the US Fish and Wildlife Service’s (FWS) red wolf program. “I mean, obviously I don’t see anything.” Sightings of red wolves are uncommon not only due to their elusive nature but also their plummeting population. Only around 30 of the creatures remain in the wild, in a corner of North Carolina, with 18 of them fitted with radio collars that Madison attempts to pick up with his antenna.
Photograph: Salwan Georges/The Washington Post/Getty Images
An FWS assessment in 2016 warned this vestige could completely vanish within eight years. The scenario now is even grimmer. “We’re already way ahead of where that projection was,” Madison said. “If we stay on the current trajectory it won’t be that long before we lose the population. In fact, we are down to one known breeding pair.” Faced with hardening opposition to the wolves’ presence from some nearby landowners, the FWS has gradually pulled back. Wild releases of captive pups have stopped, as has the sterilization of encroaching coyotes to avoid hybridization. In June, the Trump administration unveiled a plan, several years in the making, that would scale the red wolves’ protected area back to its federally owned core and allow people to shoot the species without repercussions on private land.
Conservation groups argue this plan will swiftly snuff out the red wolf and have taken the fight to the courts. “The impression we’ve gotten is that Fish and Wildlife have got tired of trying to save controversial species like wolves,” said Dr Ron Sutherland, an ecologist and red wolf expert at the Wildlands Network. “They don’t have the budget or the backing of Congress. It’s easier to let the wolves decline to the point where they can just pull the plug and we’re very nearly at that point. This wasn’t a thing started by Trump but Trump could certainly finish it off.”
Photograph: Salwan Georges/The Washington Post/Getty Images
I’m sure this is a priority for Beijing. Stop trading with these countries or they won’t stop.
Chinese authorities have prosecuted 11 people for smuggling $119 million worth of Mexican totoaba fish swim bladders, one of the country’s biggest busts related to the trafficking of an endangered species used in traditional medicine. Mexico has urged China for years to crack down on totoaba smuggling over fears that illegal fishing operations in the Gulf of California are also killing off the world’s smallest porpoise, the near-extinct vaquita marina. The Jiangmen city procuratorate in southern Guangdong province said the 11 people are suspected of smuggling nearly 20,000 swim bladders worth more than 800 million yuan ($119 million) from Mexico. The group of smugglers, led by an individual named Liang Weihua, transported the fish parts in “large quantities” and sold them to consumers in China.
“This crime lasted for more than three years,” said the Guangdong-based procuratorate, a legal supervision agency, on its website. The smuggling route involved a number of neighbouring countries, including Cambodia, Laos, and Vietnam, it said, adding that the case is currently under further investigation. The critically endangered totoaba fish has been in steep decline since the 1940s, largely because of its reputed healing powers in Chinese medicine. The fish’s swim bladder can fetch up to $20,000 on the black market in China, where it is believed to have beautifying properties and cure a host of ailments, from arthritis pain to discomfort during pregnancy. In fact, they are so prized that some Chinese simply display them in fancy cases in their homes.
“..more than 400 types of bacteria on 275 pieces of microplastic collected from local beaches. They included bugs that cause gastroenteritis and wound infections in humans..”
Microplastic pollution spans the world, according to new studies showing contamination in the UK’s lake and rivers, in groundwater in the US and along the Yangtze river in China and the coast of Spain. Humans are known to consume the tiny plastic particles via food and water, but the possible health effects on people and ecosystems have yet to be determined. One study, in Singapore, has found that microplastics can harbour harmful microbes. The new analysis in the UK found microplastic pollution in all 10 lakes, rivers and reservoirs sampled. More than 1,000 small pieces of plastic per litre were found in the River Tame, near Manchester, which was revealed last year as the most contaminated place yet tested worldwide. Even in relatively remote places such as the Falls of Dochart and Loch Lomond in Scotland, two or three pieces per litre were found.
“It was startling. I wasn’t expecting to find as much as we did,” said Christian Dunn at Bangor University, Wales, who led the work. “It is quite depressing they were there in some of our country’s most iconic locations. I’m sure Wordsworth would not be happy to discover his beloved Ullswater in the Lake District was polluted with plastic. “Microplastics are being found absolutely everywhere [but] we do not know the dangers they could be posing. It’s no use looking back in 20 years time and saying: ‘If only we’d realised just how bad it was.’ We need to be monitoring our waters now and we need to think, as a country and a world, how we can be reducing our reliance on plastic.”
[..] “Microplastic has been found in our rivers, our highest mountains and our deepest oceans,” said Julian Kirby, a plastics campaigner at Friends of the Earth who helped collect water samples for the new UK study. He urged MPs to back legislation “to drastically reduce the flow of plastic pollution that’s blighting our environment”. Research by the National University of Singapore found more than 400 types of bacteria on 275 pieces of microplastic collected from local beaches. They included bugs that cause gastroenteritis and wound infections in humans, as well as those linked to the bleaching of coral reefs.