Syria Archives - Page 5 of 13 - The Automatic Earth

Yes it is. And so of course the UK talked about one thing only. Did Corbyn call Theresa May a ‘stupid woman’ or did he say ‘stupid people’ about a group of Tories, as a whole contingent of lipreaders claimed?

They sure know what’s important, and what not.

• It’s 100 days to Brexit (Ind.)

The vote of the House of Commons on the Brexit deal will now be in the week beginning 14 January, the prime minister confirmed on Monday. She hopes that her MPs are slowly coming round to the deal as the least worst option. She may also hope that Jeremy Corbyn gives his MPs a free vote, in which case enough of them may vote for her deal as a way of avoiding another referendum. It still seems more likely that Theresa May will lose, in which case the Brexit timetable will slip further. She would probably then ask the Commons to vote again after it had rejected the other options.

The one that is easiest to eliminate would be that of leaving the EU without a deal, even if it were dressed up as a “managed no deal” – at least, it ought to be easy to eliminate this option, but, until all the hoops have been jumped through, a no-deal Brexit remains the default, which is why there was such a fuss about no-deal planning at yesterday’s cabinet. The more difficult course for parliament to rule out is that of postponing Brexit and holding a referendum. If Corbyn backs a final say referendum, a Commons vote could be close, but, if May can defeat that option, she could then ask MPs to vote again on her deal. That seems to be her plan: to wear parliament down. That way she might finally win the vote at a second attempt a week later, in the week beginning 21 January – or even after that.

By then, the country would be running out of time to complete Brexit by 29 March. The problem is that a vote to approve the deal, important though it is, is only one of the things that need to be done to take us out of the EU. Once the deal has been approved, parliament also has to pass legislation to give effect to the withdrawal agreement in UK law. This will be called the EU (Withdrawal Agreement) Bill – yet another bill that sounds similar to all the others. It will be a complex and contentious bill that will be tricky to get through a hung parliament. In particular, it will contain a mechanism to entrench parts of the withdrawal agreement in UK law and make it hard for future parliaments to change them.

Well, not really. Powell and his predecessors built such a huge zombie that it can’t be called a market. So he’s not breaking a market but a zombie, and how exactly can that be a bad thing?

• Powell Breaks The Market (ZH)

“Everything was awesome” and then Jay Powell said… Some years ago, we took away the lesson that the markets were very sensitive to news about the balance sheet, so we thought carefully about how to normalize it and thought to have it on automatic pilot, and use rates to adjust to incoming data. That has been a good decision, I think, I don’t see us changing that…. we don’t see balance sheet runoff as creating problems” And everything broke…

Overnight futures show hopeful buying – “surely The Fed will deliver and capitulate… for goodness sake, someone has to rescue my FANG portfolio!!??” – But The Fed did not – cutting their rate outlook by a mere one hike, with plenty still seeing 3 hikes ahead in 2019…

The market now expects 18bps of RATE CUTS in 2020!!!

And Futures collapsed…

Same here with my buddie Jesse: comparing what happens with today’s zombie, with functioning markets of the past, is dangerous and of limited value.

• A Major Technical Breakdown Just Occurred In Stocks (Colombo)

The much-anticipated December Fed meeting has finally come and gone, and the stock market did not like what it heard. The Fed raised rates by 0.25% and cut its expectation for 2019 rate hikes from three to two. Because the Fed didn’t sound as dovish as many investors would have liked, the S&P 500 promptly fell 1.54% to a fresh 2018 low. From a technical perspective, today’s action is extremely concerning because the S&P 500 broke the key 2,550 to 2,600 support zone that I’ve been showing for the past couple months. Today’s breakdown increases the probability of further bearish action unless the index somehow manages to close back above that zone.

The longer-term S&P 500 chart shows how critical today’s breakdown is. Today’s breakdown is the second important technical breakdown in recent months (the first one being the break below the trendline that formed in early-2016, which I said was a bad omen). Assuming today’s breakdown remains intact, 2,100 (the 2015 and 2016 highs) is the next price target and support level to watch.

Peter Schiff appears to agree with me, only he calls it a house of cards, not a zombie.

• Peter Schiff : Not A Bear Market But ‘A House Of Cards The Fed Built’ (MW)

Where in the world is Peter Schiff, as the stock market entered an apparent unraveling phase? Find the chief executive of Euro Pacific Capital, a longtime gold bug and market pundit, on a beach in Puerto Rico, where he’s taken up residence as he watches the equity market get rocked. “I’m watching the U.S. economy implode from the beach,” Schiff told MarketWatch during a recent phone interview. “We’re in a lot of trouble,” he said. “This isn’t a bear market, we’re in a house of cards that the Fed built,” he said. Indeed, despite recent attempts to rebound, the Dow Jones is on track for its worst year since 2008 — down by about 3.5% — when the financial crisis brought global markets to their knees, according to Dow Jones Market Data.

The same goes for the S&P 500 which would also notch its worst year in a decade, if its roughly 4% decline thus far this year hold. Schiff is a polarizing figure on Wall Street, a man that critics say has harbored a persistent and unrealized post-crisis narrative for the Fed’s monetary policy, with predictions of soaring inflation and a dollar collapse. However, the prominent investor should be worthy of investors’ attention, on the back of his prescient calls ahead of the 2008 financial crisis, which earned him plaudits as one of the few able to spot a global economic crisis emanating from the housing market.

“The Fed’s been a huge friend of the stock market and they are now a little bit of an enemy and will probably become worse of an enemy..”

• Asian Shares Battered After Fed Raises Rates For Fourth Time (G.)

Asian stock markets have taken a battering after the US Federal Reserve voted to raise borrowing costs for the fourth time this year, signalling a further squeeze on liquidity around the world. In Tokyo, the Nikkei closed down nearly 3% to its lowest point for 14 months as the Fed’s pledge to continue with “gradual” rate hikes next year sent shivers through financial markets. Shares in Hong Kong and Seoul were both down more than 1% while stocks in Sydney finished at a two-year low. Futures trading pointed to a drop of 2% in the FTSE100 index in London and the Dax in Frankfurt when when the markets open on Thursday morning.

Investors’ confidence that the global economy is headed for a significant slowdown was further weakened when China’s central bank introduced a new lending facility for small private businesses, which was seen as a targeted rate cut designed to kickstart the spluttering economy. The move by the People’s Bank of China shows the two biggest economies are out of step with Beijing responding to a rate hike in the US with a de facto cut. The Shanghai Composite share index was down nearly 1% in afternoon trade while the yuan wad fixed 0.22% lower against the US dollar. [..] “The Fed’s been a huge friend of the stock market and they are now a little bit of an enemy and will probably become worse of an enemy before this is all over,” Bob Doll, Nuveen chief equity strategist and senior portfolio manager, told Bloomberg.

McConnell saves the day…

• Short-Term Funding Bill Announced To Stop Trump’s Government Shutdown (Ind.)

Senate Majority Leader Mitch McConnell has introduced a short-term spending bill to finance the US government and avoid a shutdown at the end of the week Mr McConnell, the leading Republican in the Senate, said that the funding bill known as a continuing resolution “will ensure continuous funding for the federal government” until 8 February. The short-term bill needs to be approved by both the Senate and the House of Representatives before it can proceed to President Donald Trump’s desk to be signed into law. Mr McConnell’s bill comes as Congress races against time before funding for the government runs out on Friday at midnight, amid a contentious push by Mr Trump to make $5bn worth in funding for his controversial border wall a requirement for any spending agreement.

But, while Mr Trump had indicated that he would take responsibility for a shutdown in order to make a point about the wall, the White House has since stepped back from that threat. We have other ways that we can get to that $5 billion”, White House Press Secretary Sarah Huckabee Sanders said on Tuesday. On the Senate floor, Mr McConnell lashed out at Democrats, who will reclaim their House majority in January, for failing to give Mr Trump any of the $5bn he has asked for. “This seems to be the reality of our political moment,” Mr McConnell said. “It seems like political spite for the president may be winning out over sensible policy.”

We’re going to see endless and contradictory ‘analyses’ of this. It’s already drawn out the likes of Lindsey Graham and Mario Rubio and exposed them as deep state soldiers.

• Trump Plans Full Withdrawal Of US Troops From Syria (AFP)

The United States will withdraw its troops from Syria, a US official told AFP on Wednesday, after President Donald Trump said America has “defeated ISIS” in the war-ravaged country. The stunning move will have extraordinary geopolitical ramifications and throws into question the fate of US-backed Kurdish fighters who have been tackling Islamic State jihadists. “We have defeated ISIS in Syria, my only reason for being there during the Trump Presidency,” the Republican president tweeted. The US official told AFP that Trump’s decision was finalized Tuesday. “Full withdrawal, all means all,” the official said when asked if the troops would be pulled from all of Syria.

Currently, about 2,000 US forces are in Syria, most of them on a train-and-advise mission to support local forces fighting IS. The official would not provide a timeline for a withdrawal, saying only: “We will ensure force protection is adequately maintained, but as quickly as possible.” Echoing Trump, White House spokeswoman Sarah Sanders said IS has been defeated territorially, noting the US-led coalition that includes dozens of nations would continue fighting IS. “These victories over ISIS in Syria do not signal the end of the Global Coalition or its campaign,” Sanders said in a statement. “We have started returning United States troops home as we transition to the next phase of this campaign.”

[..] Republican Senator Lindsey Graham, a Trump ally, said the president’s decision was shortsighted. “President @realDonaldTrump is right to want to contain Iranian expansion,” Graham said on Twitter. “However, withdrawal of our forces in Syria mightily undercuts that effort and put our allies, the Kurds at risk.” Charles Lister, a senior fellow at the Middle East Institute, called the decision “extraordinarily short-sighted and naive.” “This move will look like a ‘withdrawal,’ not a ‘victory,’ and yet more evidence of the dangerous unpredictability of the US president,” Lister said. “This is not just a dream scenario for ISIS, but also for Russia, Iran and the Assad regime, all of whom stand to benefit substantially from a US withdrawal.”

It is quite possible that the deep state will eventually swallow Trump’s announcement whole. However, if he had gone through the usual channels to make his announcement, they would have caught it before it became public. That’s why he has Twitter.

• Don’t Hold Your Breath on US Troop Withdrawal from Syria (CN)

The announcement on Wednesday that the U.S. will withdraw all remaining troops from Syria within the next month looked at first like a rare victory for Donald Trump in his admittedly erratic opposition to senseless wars of adventure. “We have defeated ISIS in Syria, my only reason for being there,” the president tweeted with an unmistakable air of triumph. Don’t get your hopes up. Just about everything in these initial reports is either wrong or misleading. One, the U.S. did not defeat the Islamic State: The Syrian Arab Army, aided by Russia, Iran, and Hezbollah militias did. Two, hardly was ISIS the only reason the U.S. has maintained a presence in Syria. The intent for years was to support a coup against the Assad government in Damascus—in part by training and equipping jihadists often allied with ISIS.

For at least the past six months, the U.S. military’s intent in Syria has been to counter Iranian influence. Last and hardly least, the U.S. is not closing down its military presence in Syria. It is digging in for an indefinite period, making Raqqa the equivalent of the Green Zone in Baghdad. By the official count, there are 503 U.S. troops stationed in the Islamic State’s former capital. Unofficially, according to The Washington Post and other press reports, the figure is closer to 4,000—twice the number that is supposed to represent a “full withdrawal” from Syrian soil. It would be nice to think Washington has at last accepted defeat in Syria, given it is preposterous to pretend otherwise any longer.

Damascus is now well into its consolidation phase. Russia, Iran, and Turkey are currently working with Staffan de Mistura, the UN’s special envoy for Syria, to form a committee in January to begin drafting a new Syrian constitution. It would also be nice to think the president and commander-in-chief has the final say in his administration’s policies overseas, given the constitution by which we are supposed to be governed. But the misleading announcement on the withdrawal of troops, followed by Trump’s boastful tweet, suggest something close to exactly the opposite. As Trump finishes his second year in office, the pattern is plain: This president can have all the foreign policy ideas he wants, but the Pentagon, State, the intelligence apparatus, and the rest of what some call “the deep state” will either reverse, delay, or never implement any policy not to its liking.

The Grand Coalition includes the media.

• US Occupation of Middle East Doesn’t Suppress Terrorism, It Causes It (Murray)

Even the neo-con warmongers’ house journal The Guardian, furious at Trump’s attempts to pull US troops out of Syria, in producing a map to illustrate its point, could only produce one single, uncertain, very short pen stroke to describe the minute strip of territory it claims ISIS still control on the Iraqi border. Of course, the Guardian produces the argument that continued US military presence is necessary to ensure that ISIS does not spring back to life in Syria. The fallacy of that argument can be easily demonstrated. In Afghanistan, the USA has managed to drag out the long process of humiliating defeat in war even further than it did in Vietnam.

It is plain as a pikestaff that the presence of US occupation troops is itself the best recruiting sergeant for resistance. In Sikunder Burnes I trace how the battle lines of tribal alliances there today are precisely the same ones the British faced in 1841. We just attach labels like Taliban to hide the fact that invaders face national resistance. The secret to ending the strength of ISIS in Syria is not the continued presence of American troops. It is for America’s ever closer allies in Saudi Arabia and the Gulf to cut off the major artery of money and arms, which we should never forget in origin and for a long time had a strong US component. The US/Saudi/Israeli alliance against Iran is the most important geo-political factor in the region today.

It is high time this alliance stopped both funding ISIS and pretending to fight it; schizophrenia is not a foreign policy stance. There has been no significant Shia Islamic terrorist or other threat against the West in recent years. 9/11 was carried out by Saudi Sunni militants. Al Qaida, ISIS, Al Nusra, Boko Haram, these are all Sunni groups, and all Saudi sponsored. It is a matter of lunacy that the West has adopted the posture that it is Iran – which has sponsored not one attack on the West in recent memory – which is the threat in the Middle East.

Trump will have to act, or risk looking like a fool.

• Big Pharma Returning To US Price Hikes In January After Pause (R.)

Novartis and Bayer are among nearly 30 drugmakers that have taken steps to raise the U.S. prices of their medicines in January, ending a self-declared halt to increases made by a pharma industry under pressure from the Trump administration, according to documents seen by Reuters.The hikes will pose a new challenge to President Donald Trump’s pledge to lower the costs of prescription medications in the world’s most expensive pharmaceutical market. The U.S. Department of Health and Human Services (HHS) has proposed a slew of policies aimed at lowering prices and passing more of the discounts negotiated by health insurers on to patients.

Those measures are not expected to provide relief to consumers in the short-term, however, and fall short of giving government health agencies direct authority to negotiate or regulate drug prices. 28 drugmakers filed notifications with California agencies in early November disclosing that they planned to raise prices in 60 days or longer. Under a state law passed last year, companies are required to notify payers in California if they intend to raise the U.S. list price on any drug by more than 16 percent over a two-year period. [..] “Requests and public shaming haven’t worked” to lower drug prices, said Michael Rea, chief executive of RX Savings Solutions, which helps health plans and employers seek lower cost prescription medicines. “We expect the number of 2019 increases to be even greater than in past years.”

I think Salvini will get away with presenting this as a victory. But I may be wrong. How far removed is it from what Tsipras pulled in summer 2015? And how much is it like Macron and the yellow vests?

• Italy Avoids EU Sanctions After Reaching 2019 Budget Agreement (G.)

Italy has managed to avert EU sanctions after reaching a compromise with the European commission over its 2019 budget. The Italian prime minister, Giuseppe Conte, said the government had managed to reach an agreement to reduce the deficit target to 2.04% of GDP from 2.4%. This has been achieved without making drastic changes to key budget proposals such as the promise of a universal basic income and lowering the pension age. “Over the last few weeks we worked to bring the positions closer without ever moving backwards with respect to the objectives the Italian people set us in the 4 March election,” Conte said.

“The economic-financial estimates about the measures that attracted the most attention of our European partners revealed that the resources [needed] were less than forecast.” The yield, or effective interest rate, on Italian 10-year government bonds fell to 2.79%, the lowest level since September. Less than two months ago the yield, the price the Italian government has to pay to borrow, rose to 3.8%. However, Valdis Dombrovskis, a European commission vice-president, described the agreement with Italy as a “borderline compromise” that fails to provide long-term solutions to the country’s economic problems. “But it enables us, for now, to avoid opening a debt procedure, as long as the negotiated measures are fully applied,” he said at a press conference in Brussels.

Hilarious: “Police have accumulated some 23 million hours of overtime that is yet to be paid.”

• French Police Threaten To Join Protesters (NW)

The French government is desperately trying to keep its exhausted police force onside following weeks of violent protests demanding economic reforms, improved living standards and the resignation of President Emmanuel Macron. On Wednesday, French officials met with police trade union leaders to work out a deal to soothe anger in law enforcement ranks regarding overwork, unpaid overtime and difficult working conditions, Le Monde reported. But some activists are calling on police to walk out on government negotiations, close down police stations and join the “gilets jaunes”—or yellow vest—protesters with whom they have been facing off since November 17. Negotiations between three unions—Alliance, UNSA-Police and Unity-SGP-FO—and Interior Minister Christophe Castaner on Tuesday failed to reach a settlement.

As talks resumed on Wednesday, France 24 reported that activists were calling on forces across the country to commit to a “slowdown” and only respond to emergencies until the dispute had been settled. Police have accumulated some 23 million hours of overtime that is yet to be paid. According to The Local France, police union leader Frédéric Lagache explained, “Faced with this irresponsibility [of the government], we are forced to be irresponsible in our actions.” The Alliance and Unity-SGP-FO unions called for a “black day for the police” on Wednesday. The Alliance is using Twitter and Facebook to rally support for what it calls “Act 1” of the police protests, using the name given to the ongoing demonstrations held by the gilets jaunes. The group has also threatened to hold “Act II” and “Act III” if required.

I’m thinking one word here: copycats. Too easy not to try at home.

• London’s Gatwick Airport Shut Down After Drones Spotted Overhead (AP)

London’s Gatwick Airport shut down late Wednesday while officials urgently investigated reports that two drones were flying above the airfield. The airport suspended all flights, causing severe disruptions just days before Christmas during one of the heaviest travel times of the year. Police and aviation authorities were still investigating early Thursday as incoming flights were diverted to other locations in Britain and nearby countries. Passengers complained on Twitter that their flights had landed at London Heathrow, Manchester, Birmingham and other cities. Other flights were sent to France and the Netherlands. One traveler whose flight was diverted tweeted that passengers were not being told when they could continue to their destination.

Gatwick advised travelers via Twitter to check flights scheduled for Thursday before heading to the airport. It also advised anyone planning to pick up arriving passengers to check first. Any problem at Gatwick causes a ripple effect throughout Britain and continental Europe, particularly during a holiday period when the air traffic control system is under strain. It is a busy airport 27 miles south of London, hosting a variety of short- and long-haul flights and serving as a major hub for the budget carrier easyJet. Gatwick normally operates throughout the night but the number of flights is restricted because of noise limitations. The airport website says it usually handles 18 to 20 flights overnight during the winter months.

Yes, it’s priceless to read the Guardian on fake news.

Craig Murray tweets: ..The Guardian today published a story about a German journalist who invented stories, but still has never apologised for its own 100% fabricated Luke Harding piece about Manafort’s “visits to Assange in the Embassy”, and Harding and Viner are still employed..

• Der Spiegel Says Top Journalist Faked Stories For Years (G.)

The German news magazine Der Spiegel has been plunged into chaos after revealing that one of its top reporters had falsified stories over several years. The media world was stunned by the revelations that the award-winning journalist Claas Relotius had, according to the weekly, “made up stories and invented protagonists” in at least 14 out of 60 articles that appeared in its print and online editions, warning that other outlets could also be affected. Relotius, 33, resigned after admitting to the scam. He had written for the magazine for seven years and won numerous awards for his investigative journalism, including CNN Journalist of the Year in 2014.

Earlier this month, he won Germany’s Reporterpreis (Reporter of the Year) for his story about a young Syrian boy, which the jurors praised for its “lightness, poetry and relevance”. It has since emerged that all the sources for his reportage were at best hazy, and much of what he wrote was made up. The falsification came to light after a colleague who worked with him on a story along the US-Mexican border raised suspicions about some of the details in Relotius’s reporting, having harboured doubts about him for some time.

The colleague, Juan Moreno, eventually tracked down two alleged sources quoted extensively by Relotius in the article, which was published in November. Both said they had never met Relotius. Relotius had also lied about seeing a hand-painted sign that read “Mexicans keep out”, a subsequent investigation found. Other fraudulent stories included one about a Yemeni prisoner in Guantanamo Bay, and one about the American football star Colin Kaepernick.

Sometimes I think that if all my friends are leaving, why would I stay behind?

• Finless Porpoise, China’s Smiling Angel, Fights To Survive (AFP)

In an oxbow lake along the middle reaches of the Yangtze River, a breathy sigh pierces the surface stillness as one of China’s most endangered animals comes up for a gulp of hazy air. A slick black back with no dorsal fin arches briefly above the water line before plunging back down. Such glimpses of the shy Yangtze finless porpoise, the only aquatic mammal left in China’s longest river and known in Chinese as the “smiling angel” for its perma-grin, are increasingly rare. Pollution, overfishing, hydroelectric dams and shipping traffic have rendered them critically endangered, worse off even than China’s best-known symbol of animal conservation, the panda.

AFP Photo/Johannes EISELE

China’s government estimates there were 1,012 wild Yangtze finless porpoises in 2017, compared to more than 1,800 giant pandas, which is no longer endangered. But researchers see signs of hope. Porpoise numbers fell by nearly half from 2006-2012 to an estimated 1,040. But the rate of decline has slowed markedly since then, suggesting that conservation may be making a dent. A central component of the rescue effort is the introduction of porpoises to several conservation areas off the busy river, where researchers say numbers have been actually increasing. [..] Chinese officials are keen to avoid a repeat of the “baiji”, or Yangtze dolphin, the river’s only other aquatic mammal, which since 2006 has been considered extinct in a huge conservation setback for China. Losing the “smiling angel” would be a further tragedy, conservationists say.

Debt Rattle October 28 2018

Oct 282018

October 28, 2018 Posted by Raúl Ilargi Meijer at 9:32 am Finance Tagged with: Brexit, China Model, Day of the Dead, Final Say, homeowners, Iran, Khashoggi, Merkel, Mexico, migrants, pensions, Saudi, Syria 4 Responses »

Salvador Dali City of drawers – The Anthropomorphic Cabinet 1936

• OECD Countries’ Retirement Assets Surpass $43 Trillion In 2017 (PiO)

• As The Housing Market Stagnates, American Homeowners Are Staying Put (MW)

• Economist Slams ‘China Model’ That ‘Inevitably Leads To Confrontation’ (SCMP)

• Rand Paul Seeks To Punish Saudi Arabia For Khashoggi Killing (Pol.)

• Saudi Arabia Says It Is A Beacon Of Light Fighting ‘Dark’ Iran (G.)

• EU To Make Contingency Plans For A Second Brexit Referendum (Ind.)

• Germany’s Fragile Coalition Braced For More Upsets (G.)

• Russia-Turkey-Germany-France Talks On Syria Kick Off (RT)

• “My” Suspended Twitter Account (Paul Craig Roberts)

• Mexico Honors Migrants At Day Of The Dead As Caravan Treks North (R.)

2/3(?!) of it is in the US.

• OECD Countries’ Retirement Assets Surpass $43 Trillion In 2017 (PiO)

Retirement assets in OECD countries hit a record $43.4 trillion at the end of 2017, well above the pre-crisis level. The OECD said in its annual Pension Markets in Focus report that assets invested in all funded and private pension systems across 87 jurisdictions grew 12.1% over the year, and increased 53.9% compared with figures at the end of 2007. The report said assets are unevenly distributed worldwide, with less than $200 billion across 78% of the reporting countries, while 8% held more than $1 trillion each: the U.S. with about $28.2 trillion; the U.K. with $2.9 trillion; Canada at $2.6 trillion; Australia with $1.8 trillion; the Netherlands with $1.6 trillion; Japan at $1.4 trillion; and Switzerland with $1 trillion. The remaining 9% of assets, or about $3.9 trillion, are split among the other 29 OECD countries.

The largest amounts of assets are located in some of the biggest economies in the world and with a long history of retirement savings. High investment returns from equity markets partially explain the growth of these assets, said the report, with the real net investment rate of return on retirement assets exceeding 4% on average in 2017. U.S. retirement plans achieved a 7.5% real net investment rate of return in 2017, added the OECD. Funding levels for DB funds improved in the U.S., to 59.6% at end-2017 from 56% a year earlier; but worsened from 2007 figures of 68.6%. The funding ratio was calculated as the ratio of total investment and net technical provisions for occupational defined benefit plans using values reported by national authorities in the OECD template.

U.K. funding levels improved to 90.5% as of the end of 2017, up from 85.8% a year earlier, but down from 108.8% as of the end of 2007. Denmark had the highest funding level of OECD countries in the report, at 135.1%. However, that level was down from 146.1% a year earlier, but improved over the 127.4% funding level as of the end of 2007.

Bad time to become a real estate agent.

• As The Housing Market Stagnates, American Homeowners Are Staying Put (MW)

Housing-market headwinds are keeping American homeowners in their properties for the longest stretches on record, in a sharp distortion of the mobility Americans have for decades prized. Across the country, homes that sold in the third quarter of this year had been owned an average of 8.23 years, according to an analysis from Attom Data Solutions. That’s almost double the length of time a home sold in 2000, when Attom’s data begin, had been owned. It’s partly the long tail of the housing crisis that’s created stagnant conditions and a less dynamic housing market, Attom spokesman Daren Blomquist told MarketWatch.

As of the second quarter, 2.2 million homeowners were still underwater on their mortgages, meaning they owe more to their lending institution than the home is worth, according to data from CoreLogic. Another 550,000 have 5% equity or less, meaning that if that property were to be sold the transaction costs, such as a real-estate agent’s commission, would likely leave the homeowner with nothing. The hypercompetitive market that’s emerged from the wreckage of the crisis is also keeping people in place. Many homeowners have ample equity in their homes, but hesitate to list those homes because they’re worried about finding a property to buy if they do sell. A few others may be trapped by “rate lock” — enjoying the benefits of their ultralow mortgage rates, and unwilling to spend more on financing costs.

Interesting that he gets to say it.

• Economist Slams ‘China Model’ That ‘Inevitably Leads To Confrontation’ (SCMP)

Using the “China model” to explain the country’s economic success over the past four decades is wrong and dangerous, according to an influential Chinese economist, who says this misconception has inevitably led to antagonism between China and the West. Zhang Weiying, one of the most prominent liberal economists in the country and a professor at prestigious Peking University, made the comments in a lecture on October 14. An edited version of his speech was published on the university’s website on Wednesday. The speech is a wholesale negation of the “China model” theory that has gained traction in recent years, as the country becomes more confident in promoting its own development path under President Xi Jinping.

Zhang lashes out at those who attribute China’s economic growth to an exceptional “China model”, which includes a powerful one-party state, a colossal state sector and “wise” industrial policy, saying it is not only factually wrong, but also detrimental to the country’s future. “The theory of the ‘China model’ sets China as a frightening anomaly from the Western perspective, and inevitably leads to confrontation between China and the West,” he said. “The hostile international environment we face today is not irrelevant to the wrong interpretation of China’s achievement in the past 40 years by some economists.”

The economist’s rejection of the “China model” comes as debates about the country’s economic future are heating up. The world’s second largest economy is losing steam – growth is at its slowest pace since 2009 – as it marks 40 years since its market reforms. At home, it is grappling with a mountain of debt, plunging stocks and an ailing private sector. Abroad, tensions over the prolonged trade war with the United States appear to be spilling over into defence, diplomacy and politics. Zhang said the trade war not only reflected conflict between China and the US, but between China and the larger Western world. It also went beyond trade to reflect the clash over value systems, he said.

Like his dad, strongly anti-war.

• Rand Paul Seeks To Punish Saudi Arabia For Khashoggi Killing (Pol.)

Sen. Rand Paul says he’s not going to let Saudi Arabia off the hook after journalist Jamal Khashoggi was killed in Turkey by agents linked to the Saudi government. The Kentucky Republican said Saturday he’s intent on forcing another vote to block billions in arm sales to the autocratic Middle Eastern kingdom and won’t settle for targeted sanctions, seeking to capitalize on negative public sentiment surrounding the Oct. 2 killing. “Are we going to do fake sanctions? Are we going to pretend to do something by putting sanctions on 15 thugs. Or are we going to do something that hurts them?” Paul said in an interview here, explaining that he thinks Saudi Arabia is trying to wait him out until Khashoggi fades from the headlines before announcing the arms sale, which would allow him to try and stop it.

“They know if they have the vote they might lose. So they’re probably not going to make any announcement until this dies down,” Paul said. Rather than focusing simply on Khashoggi, Paul has made a broader critique of Saudi Arabia as supporting “violent Jihad” and a brutal civil war in Yemen. But he’s noticed a substantive shift in the way his colleagues are now talking about the country. [..] Paul, a longtime Saudi critic, has previously forced votes to block the arms sales, but they have failed given a strong hawkish wing in the Senate that wants to keep a key ally against Iranian influence in the Middle East. Paul says that has changed. “We would win the vote right now. It would be a very bad vote if 60, 65, or even 70 people voted to cut the arms sales for now and the president were to veto that, that would be bad,” he said.

President Donald Trump has been more circumspect when discussing arms sales, questioning the wisdom of canceling sales that he believes creates hundreds of thousands of jobs. Paul said he’s tried to convince the president to come to his position, but he’s not there yet. “He says he doesn’t want to disrupt the arm sales. And it’s something we have an honest disagreement on. I don’t think arms are jobs programs,” Paul said. He said their “discussions aren’t really that much that back and forth.” [..] Paul also broke further with the president on foreign policy. He called it a “terrible idea” for the United States to back away from nuclear and weapons agreements with Russia and said he’s asked Trump to appoint nuclear negotiators in a bid to preserve the NEW START treaty and the INF agreement.

Not sure how this would help their case at this point.

• Saudi Arabia Says It Is A Beacon Of Light Fighting ‘Dark’ Iran (G.)

Saudi Arabia’s foreign minister has described the kingdom as a “vision of light” in the region as it tries to control the fallout from Jamal Khashoggi’s killing – its biggest diplomatic crisis since the 9/11 attacks. After more than two weeks of international outrage over the journalist and dissident’s death, Adel al-Jubeir sought to portray the country as the moral beacon of the Middle East, in stark opposition to Iran, Saudi Arabia’s arch-rival. “We are now dealing with two visions in the Middle East,” Jubeir told a security summit in Bahrain on Saturday. “One is a [Saudi] vision of light … One is [an Iranian] vision of darkness which seeks to spread sectarianism throughout the region. History tells us that light always wins out against the dark.”

Condemning the media coverage of Khashoggi’s killing as “hysterical”, Jubeir rejected a call from Recep Tayyip Erdogan, the Turkish president, to try the 18 suspects in Turkey, stressing that they would be “held accountable” on Saudi soil. [..] Erdogan reiterated during an address to parliament on Friday that Riyadh must disclose the location of Khashoggi’s body and identify who ordered his killing – a sign that Ankara is willing to keep up the pressure on the beleaguered kingdom and its de facto ruler, the crown prince Mohammed bin Salman. [..] Jim Mattis, the US defence secretary, who also spoke at the summit in Manama, said that Khashoggi’s killing had “undermined regional stability”. Washington was considering additional punitive measures against those responsible after issuing visa bans for the suspects in the case, Mattis added.

5 months left. Nothing decided on.

• EU To Make Contingency Plans For A Second Brexit Referendum (Ind.)

The EU’s chief negotiator has been warned to make contingency plans for a second Brexit referendum, as pressure builds to give the public a final say on leaving. Prominent Remain politicians met with Michel Barnier in Brussels this week and said it was time to start “serious contingency planning”, as The Independent’s petition neared one million signatures and the future of Brexit looks increasingly uncertain. In a visit on Friday, Sadiq Khan, the mayor of London, told Mr Barnier that the negotiating period should be extended so Britain could have “time to have a referendum”. The warning comes after 700,000 people took to the streets of London last weekend to make the case for a vote on the final deal.

For there to be time to hold a referendum, the EU would likely have to extend the Article 50 negotiating period, which will automatically expire on 29 March 2019, leaving Britain to slide out with a no-deal Brexit. The calls for an extension came from across a number of parties. Liberal Democrat leader Vince Cable said following a meeting with Mr Barnier on Thursday: “My message to Michel Barnier was clear: it’s time to start serious contingency planning for a People’s Vote. We know the UK government has started making such plans as a result of the growing demand for such a vote, demonstrated by last weekend’s march. “The EU should do the same, because MPs who back the People’s Vote are fast forming the biggest and most cohesive bloc in Westminster.”

This will have an increasing effect on Europe as a whole. Who’s going to listen to Merkel as she’s fading at home?

• Germany’s Fragile Coalition Braced For More Upsets (G.)

[..] voters in the central state of Hesse have the power to deliver a second electoral upset within a fortnight to Germany’s embattled ruling parties, potentially plunging both into fresh crises. The regional election is seen as decisive for the future of Merkel’s rickety coalition government. Last-minute polling showed support plummeting for both her Christian Democrat Union (CDU) and coalition partner the Social Democrats (SPD) in a swing state traditionally seen as a bellwether for national politics. Both parties were predicted to drop 10 points each since the state’s last regional election in 2013. Such a trouncing would come on the heels of a disastrous result in Bavaria that was widely seen as a protest against the failings of the Berlin government.

“None of the parties are there for us,” said Müller, who has voted for both CDU and SPD in the past, but was still undecided. “What should I do? I have to vote, it’s my duty to stop the far right getting into power. But I also know I won’t be heard. I can vote for whoever I like; the politicians will still do whatever they want.” Hesse, home to Germany’s financial centre, Frankfurt, has been governed by CDU-led coalitions for the past two decades. But polls have the party nosediving to 28%, a result that would end the state’s CDU-Green coalition and leave a question mark over the future of CDU state premier and close Merkel ally Volker Bouffier.

With tensions running high in the CDU, mutinous members have implied that if Bouffier falls, it may cost the chancellor vital votes when she stands for re-election as party leader at its conference in early December. But Merkel, who joined Bouffier on the campaign trail last week, was at pains to play down the significance of the regional vote for her party, government and chancellorship. “Hesse, and what happens here, is being watched and considered from far beyond Germany’s borders,” Merkel told supporters on Thursday in Fulda. “I want to point out once again that on Sunday the vote is about Hesse. Afterwards we’ll talk again about Berlin.”

The fighting in Idlib must cease. It’s the only outcome.

• Russia-Turkey-Germany-France Talks On Syria Kick Off (RT)

Leaders of Russia, Turkey, Germany and France have gathered in Istanbul to discuss the Syrian peace process. While the outcome of such tricky talks is hard to predict, the new format appears to be, at least, quite refreshing. Russia’s President Vladimir Putin, his French counterpart Emmanuel Macron and German Chancellor Angela Merkel arrived in Istanbul on Saturday to talk Syrian reconciliation. The host, Turkey’s leader Recep Tayyip Erdogan, has put high expectations on the gathering. “The whole world is watching this meeting. I hope, that the hopes will be met,” Erdogan said, while opening the summit. The four leaders are also expected to be joined by UN Special Envoy to Syria Staffan de Mistura.

The four-way summit is an entirely new format of talks on the war-torn country, which has endured years-long conflict. The meeting is all about testing the waters and trying to bring about different formats of talks on Syria, as if the leaders were to “synchronize watches” rather than reach a breakthrough, Kremlin spokesman Dmitry Peskov said. Similar opinion was expressed by Germany, with Foreign Minister Heiko Maas stating that the summit effectively brings different sides together for the very first time. “There are Russians and Turks, who have been at the same format of talks with Iran. And on the other side, there are French and us, who partake in the so-called ‘Friends of Syria’ group,” Maas said ahead of the event, adding that having a “joint conversation” was a viable idea.

Turns out, the story was a bit different than many reported.

• “My” Suspended Twitter Account (Paul Craig Roberts)

Dear Readers:

It is all over the internet and international media that Twitter has suspended my account. This is not the case. I do not use social media. I discovered that a Twitter account was operating in my name. I requested that the account be taken down. I have no recollection of giving anyone permission to operate a Twitter account in my name. I am still extremely busy trying to help family relatives impacted by Hurricane Michael and could only quickly look at the Twitter postings. It seemed to be mainly innocuous, consisting of links or quotes from my posted columns.

However, there were other things, such as appeals that money be sent to Alex Jones InfoWars and other things. I have no objection to Alex Jones. However, my webmaster and I were concerned that things could be posted that would be dangerous for me, such as libel, death threats to others, and so forth. To repeat, the account was closed at my request. To repeat, I do not use social media.

Paul Craig Roberts

There’s something cynical about this, but also beautiful.

• Mexico Honors Migrants At Day Of The Dead As Caravan Treks North (R.)

Mexico City dedicated its Day of the Dead parade on Saturday to migrants, just as thousands of Central Americans were trekking from the country’s southern border toward the United States under pressure from U.S. President Donald Trump to disband. In an a twist on the traditional dancing skeletons and marigold-adorned altars making their way down the capital’s main thoroughfare, the parade also referenced Mexicans who emigrated as well as foreigners who settled in the capital. “The parade… is dedicated to migrants, who in their transit to other countries have lost their lives, and who in their passing through the country have contributed to a true ‘Refuge City,’” the Mexico City government said on Twitter.

In one segment, gray metallic panels representing the Mexico side of the U.S. border wall were stenciled with the phrase, “There are also dreams on this side.” Other presentations honored exiled Spaniards, Argentineans and Jews, Mexico City’s culture ministry said. The event ahead of Nov. 1 and 2, when Mexicans observe Day of the Dead in town squares, homes and cemeteries, coincided by chance with the journey of a migrant caravan traveling into Mexico, many fleeing violence and poverty in Honduras and Guatemala.

Debt Rattle October 16 2018

Oct 162018

October 16, 2018 Posted by Raúl Ilargi Meijer at 9:15 am Finance Tagged with: Assange, Brexit, carry trade, deficit, Ecuador, famine, insects, liquidity, Powell, Syria, tree of life, Yemen 7 Responses »

M. C. Escher Doric columns 1945

• Yemen On Brink Of ‘World’s Worst Famine In 100 Years’ (G.)

• Humanity Is ‘Cutting Down The Tree Of Life’ (G.)

• ‘Hyperalarming’ Study Shows Massive Insect Loss (WaPo)

• America’s Budget Deficit Jumps By 17% As Spending Surges (CNBC)

• More Free Money: A Carry Trade in Liquidity (Mish)

• Powell Has Lost His North Star, And The Fed Is Flying Blind (MW)

• Facebook Paid £15.8 Million In UK Tax On £1.2 Billion In 2017 Revenues (BBC)

• Ecuador To Assange: No Talking Politics, Pay Own Bills, Look After Cat (RT)

• Brexit Deal Slipping To December Amid Deadlocked Talks (Ind.)

• No-Deal Brexit Is ‘More Likely Than Ever Before’ – Tusk (Ind.)

• Syria’s Chessboard (Hallinan)

As Stormy Daniels and Elizabeth Warren see their ‘cases’ blow up in their faces 3 weeks before the midterms, the best PR and legal teams that money can buy are framing a Khashoggi narrative nobody will be able to credibly deny. Or at least Erdogan is not showing his hand. But now that Pompeo’s in the region anyway, let’s put this on his agenda. 12 to 13 million at risk of starvation.

• Yemen On Brink Of ‘World’s Worst Famine In 100 Years’ (G.)

Yemen could be facing the worst famine in 100 years if airstrikes by the Saudi-led coalition are not halted, the UN has warned. If war continues, famine could engulf the country in the next three months, with 12 to 13 million civilians at risk of starvation, according to Lise Grande, the agency’s humanitarian coordinator for Yemen. She told the BBC: “I think many of us felt as we went into the 21st century that it was unthinkable that we could see a famine like we saw in Ethiopia, that we saw in Bengal, that we saw in parts of the Soviet Union – that was just unacceptable. “Many of us had the confidence that would never happen again and yet the reality is that in Yemen that is precisely what we are looking at.”

Yemen has been in the grip of a bloody civil war for three years after Houthi rebels, backed by Iran, seized much of the country, including the capital, Sana’a. The Saudi-led coalition has been fighting the rebels since 2015 in support of the internationally recognised government. Thousands of civilians have been caught in the middle, trapped by minefields and barrages of mortars and airstrikes. The resulting humanitarian catastrophe has seen at least 10,000 people killed and millions displaced. Speaking on Sunday evening, Grande said: “There’s no question we should be ashamed, and we should, every day that we wake up, renew our commitment to do everything possible to help the people that are suffering and end the conflict.”

And it’s not just people that we’re killing:

• Humanity Is ‘Cutting Down The Tree Of Life’ (G.)

Humanity’s ongoing annihilation of wildlife is cutting down the tree of life, including the branch we are sitting on, according to a stark new analysis. More than 300 different mammal species have been eradicated by human activities. The new research calculates the total unique evolutionary history that has been lost as a result at a startling 2.5bn years. Furthermore, even if the destruction of wild areas, poaching and pollution were ended within 50 years and extinction rates fell back to natural levels, it would still take 5-7 million years for the natural world to recover. Many scientists think a sixth mass extinction of life on Earth has begun, propelled by human destruction of wildlife, and 83% of wild mammals have already gone.

The new work puts this in the context of the evolution and extinction of species that occurred for billions of years before modern humans arrived. “We are doing something that will last millions of years beyond us,” said Matt Davis at Aarhus University in Denmark, who led the new research. “It shows the severity of what we are in right now. We’re entering what could be an extinction on the scale of what killed the dinosaurs. “That is pretty scary. We are starting to cut down the whole tree [of life], including the branch we are sitting on right now.” Ecosystems around the world have already been significantly affected by the extermination of big animals such as mammoths, he said.

[..] Davis said each lost species had its own intrinsic value, but the loss of the most distinct creatures was most damaging: “Typically, if you have something that is off by itself, it does some job that no other species is doing.” The losses are already affecting ecosystems, he said, particularly the vanishing of “megafauna”. These huge creatures roamed much of Earth until humans arrived and included giant cats, deer, beavers and armadillos. “We are now living in a world without giants,” said Davis. “So the seeds of big fruit are not dispersed any more because we don’t have mammoths or gomphotheres or giant ground sloths eating those fruits.” Another example, he said, is the widespread loss of wolves. This means smaller predators like coyotes thrive and more birds are killed, radically changing food chains.

“Between January 1977 and January 2013, the catch rate in the sticky ground traps fell 60-fold..”

“..our study indicates that climate warming is the driving force behind the collapse of the forest’s food web. ”

• ‘Hyperalarming’ Study Shows Massive Insect Loss (WaPo)

Insects around the world are in a crisis, according to a small but growing number of long-term studies showing dramatic declines in invertebrate populations. A new report suggests that the problem is more widespread than scientists realized. Huge numbers of bugs have been lost in a pristine national forest in Puerto Rico, the study found, and the forest’s insect-eating animals have gone missing, too. In 2014, an international team of biologists estimated that, in the past 35 years, the abundance of invertebrates such as beetles and bees had decreased by 45 percent. In places where long-term insect data are available, mainly in Europe, insect numbers are plummeting. A study last year showed a 76 percent decrease in flying insects in the past few decades in German nature preserves.

The latest report, published Monday in the Proceedings of the National Academy of Sciences, shows that this startling loss of insect abundance extends to the Americas. The study’s authors implicate climate change in the loss of tropical invertebrates. “This study in PNAS is a real wake-up call — a clarion call — that the phenomenon could be much, much bigger, and across many more ecosystems,” said David Wagner, an expert in invertebrate conservation at the University of Connecticut who was not involved with this research. He added: “This is one of the most disturbing articles I have ever read.”

[..] “We went down in ’76, ’77 expressly to measure the resources: the insects and the insectivores in the rain forest, the birds, the frogs, the lizards,” Lister said. He came back nearly 40 years later, with his colleague Andrés García, an ecologist at the National Autonomous University of Mexico. What the scientists did not see on their return troubled them. “Boy, it was immediately obvious when we went into that forest,” Lister said. Fewer birds flitted overhead. The butterflies, once abundant, had all but vanished. García and Lister once again measured the forest’s insects and other invertebrates, a group called arthropods that includes spiders and centipedes. The researchers trapped arthropods on the ground in plates covered in a sticky glue, and raised several more plates about three feet into the canopy.

The researchers also swept nets over the brush hundreds of times, collecting the critters that crawled through the vegetation. Each technique revealed the biomass (the dry weight of all the captured invertebrates) had significantly decreased from 1976 to the present day. The sweep sample biomass decreased to a fourth or an eighth of what it had been. Between January 1977 and January 2013, the catch rate in the sticky ground traps fell 60-fold. “Everything is dropping,” Lister said. The most common invertebrates in the rain forest — the moths, the butterflies, the grasshoppers, the spiders and others — are all far less abundant. “Holy crap,” Wagner said of the 60-fold loss.

Comparison of the average dry-weight biomass of arthropods caught per 12-h day in 10 ground (A) and canopy (B) traps within the same sampling area in the Luquillo rainforest.

If there are no insects left, who cares about deficits? What’s the use?

• America’s Budget Deficit Jumps By 17% As Spending Surges (CNBC)

The U.S. federal budget deficit rose in fiscal 2018 to the highest level in six years as spending climbed, the Trump administration said Monday. The deficit jumped to $779 billion, $113 billion or 17 percent higher than the previous fiscal period, according to a statement from Treasury Secretary Steven Mnuchin and Office of Management and Budget Director Mick Mulvaney. It was larger than any year since 2012, when it topped $1 trillion. The budget shortfall rose to 3.9 percent of U.S. GDP. The deficit increased by $70 billion less than anticipated in a report published in July, according to the two officials.

Federal revenue rose only slightly, by $14 billion after Republicans chopped tax rates for corporations and most individuals. Outlays climbed by $127 billion, or 3.2 percent. A spike in defense spending, as well as increases for Medicaid, Social Security and disaster relief, contributed to the increase.

“If the goal was to bail out the banks at public expense (and it was) it’s clear Bernanke had a far better plan than the ECB.”

• More Free Money: A Carry Trade in Liquidity (Mish)

Not only do banks earn free money on excess reserves, they can borrow money and make guaranteed free money on that.

The Federal Reserve Bank of St. Louis discusses the Carry Trade in Liquidity: “The IOER [interest on excess reserves] has been the effective ceiling of other short-term interest rates. The figure above compares the IOER with overnight rates on deposits and repos. As we can see, the IOER has mostly remained above these two rates, implying that (at least some) banks have been able to borrow funds overnight, deposit them at the Fed and earn a spread, in essence engaging in carry trade in liquidity markets.”

How Much Free Money?

While the Fed has been busy giving banks free money by paying interest on excess reserves, banks in the EU have suffered with negative interest rates, essentially taking money from banks and making them more insolvent. If the goal was to bail out the banks at public expense (and it was), it’s clear Bernanke had a far better plan than the ECB.

The Fed’s been flying blind at least since Bernanke talked about ‘entering uncharted territory’. That’s what that means.

• Powell Has Lost His North Star, And The Fed Is Flying Blind (MW)

Federal Reserve Chairman Jerome Powell is in an unenviable position. Folks expect him to fine-tune interest rates to keep the economy going and inflation tame but he can’t make things much better — only worse. Growth is nearly 3% and unemployment is at its lowest level since 1969. What inflation we have above the Fed target of 2% is driven largely by oil prices and those by forces beyond the influence of U.S. economic conditions — OPEC politics, U.S. sanctions on Iran, and dystopian political forces in Venezuela and a few other garden spots. When the current turbulence in oil markets recedes, we are likely in for a period of headline inflation below 2%, just as those forces are now driving prices higher now.

Overall, long-term inflation has settled in at the Fed target of about 2%. The Fed should not obsess about it but keep a watchful eye. Amid all this, Powell’s inflation compass has gone missing. The Phillips curve, as he puts it, may not be dead but just resting. To my thinking, it’s in a coma if it was ever alive at all. That contraption is a shorthand equation sitting atop a pyramid of more fundamental behavioral relationships. Those include the supply and demand for domestic workers and in turn, an historically large contingent labor force of healthy prime-age adults sitting on the sidelines, the shifting skill requirements of a workplace transformed by artificial intelligence and robotics, import prices influenced by weak growth in Europe and China, and immigration.

Of course, Mariner Powell has his North Star — what economists affectionately call R* (R-Star), but it is no longer at a fixed position in Powell’s sky. R* is the federal funds rate that neither encourages the economy to speed up or slow down. However, with businesses needing much less capital to get started or grow these days and for decades China and Germany—the second and fourth largest economies globally—racking up current account surpluses and savings to invest abroad, it is no wonder the forces of supply and demand have been driving R* down to historically low levels.

They use what they don’t pay in taxes, to spy on you.

• Facebook Paid £15.8 Million In UK Tax On £1.2 Billion In 2017 Revenues (BBC)

Facebook’s UK tax bill has tripled to £15.8m – but the social media giant will see an immediate cut because of a tax credit. The final bill comes to £7.4m, since Facebook will see tax relief of £8.4m after awarding shares to employees. In 2016, Facebook’s tax bill rose to £5.1m, following a major overhaul of the social media firm’s tax structure. However, the company’s profits only climbed by £4m year-on-year from £58.4m to £62.7m in 2017. The company’s UK office provides marketing services and sales and engineering support to the company. Facebook’s revenue rose by a third year-on-year to £1.2bn in 2017, because of increased revenues from inter-company and advertising reseller services in 2017.

“We have changed the way we report tax so that revenue from customers supported by our UK teams is recorded in the UK and any taxable profit is subject to UK corporation tax,” said Facebook’s Northern Europe vice-president, Steve Hatch. [..] The publication of Facebook’s 2017 tax accounts follows extensive criticism from policymakers and the media over the last 12 months of how much tax tech giants typically pay in Europe. Large technology companies have been condemned for moving sales through other countries and paying modest amounts of tax in the UK.

Hard to gauge what exactly this means, time must tell. Seems good that they talk of medical help. but will he be able to get it?

• Ecuador To Assange: No Talking Politics, Pay Own Bills, Look After Cat (RT)

WikiLeaks supporters were thrilled to hear that Ecuador would restore Julian Assange’s internet connection. But his hosts – who have in some ways become his jailers – reportedly imposed a long list of restrictions on his behavior. While stating that he is allowed to exercise his “right of communication and freedom of expression,” a nine-page document already leaked online forbids the journalist from engaging in political activity or doing anything to interfere in the affairs of other states. The document expressly states that Ecuador cannot be held liable for the content of Assange’s communications, but nevertheless prohibits him from engaging in activities that might damage the relationship between Ecuador and other states.

Assange’s communications were cut seven months ago, after he criticized Spanish authorities’ treatment of voters during the Catalan independence referendum. Assange must pay for his own WiFi. He must use only his own devices, absent written government permission, and provide the embassy with serial number, model number, and brand name for those devices. He must also pay for his own medical evaluations, with the option of transferring to a hospital in case of an emergency – an option repeatedly denied him by UK authorities, who refused to guarantee safe passage without arrest in the event of such a transfer. Assange’s health has been the subject of much concern during his six-year confinement in the Embassy.

Visitors are also slapped with new restrictions. They must submit visit requests in writing to the embassy chief, giving their name, nationality, profession and place of work, reason for visiting, email and social media accounts, and even the serial numbers for phones and other devices they wish to bring inside. The new rules even mandate the collection of IMEIs, unique identification numbers specific to a phone handset. While repeat visitors receive a less restrictive screening process, they can have their access revoked at any time without an explanation. All visitor data will be turned over to the Ecuadorian Ministry of Foreign Affairs and other unspecified parties.

The restrictions include a threat to use UK police to arrest visitors or seize communications equipment should the journalist violate the lengthy list of rules. Adding insult to injury, the embassy threatened to remove Assange’s cat to a shelter should they decide he is not cleaning up after the animal properly.

They lost two years doing nothing but fight amongst themselves. That time was always badly needed.

• Brexit Deal Slipping To December Amid Deadlocked Talks (Ind.)

A Brexit deal now looks unlikely until just before Christmas after Theresa May admitted “weeks” may be needed to break the deadlock in talks with Brussels. The delay was also signalled by Ireland’s prime minister who warned of log-jammed negotiations dragging into December, increasing concern that stalled talks could simply collapse into a “disaster” no-deal situation. In a veiled swipe at Brexiteers, European Council President Donald Tusk said solving the vexed issue of the Irish border had proved “more complicated than some may have expected” and said no deal is now “more likely than ever”.

A further sign of slippage came when the EU confirmed it would take a decision this week on whether a special summit once proposed for November to publicly seal a Brexit deal, will be needed given the state of talks. But despite the deadlock, Ms May again came under intense pressure from Conservative Eurosceptics to refuse anything resembling the EU’s proposals, amid signs she is diluting her stance to secure a deal. The October summit was once supposed to be the moment a withdrawal deal was locked in, with expectations already having slipped to a potential specially arranged meeting in November – even under those circumstances the outline would have had to have been agreed at this week’s meeting.

More likely by the day.

• No-Deal Brexit Is ‘More Likely Than Ever Before’ – Tusk (Ind.)

A no-deal Brexit is “more likely than ever before”, the president of the European Council has warned, ahead of a make-or-break summit of EU leaders in Brussels. Donald Tusk, who has described this week’s top-level meeting as “the moment of truth”, said Brexit had “proven to be more complicated than some may have expected”. But he said that “that we are preparing for a no-deal scenario must not, under any circumstances, lead us away from making every effort to reach the best agreement possible”.

Mr Tusk’s warning, made in a letter to EU leaders formally inviting them to the summit, comes a day after negotiations between the European Commission and UK Government hit a a wall over the question of how to prevent a hard border in Northern Ireland. Over dinner on Wednesday night the heads of state or government of the 27 remaining EU member states will decide whether there is any pointing holding a special Brexit summit in November – or whether the horse has already bolted. It is now confirmed that Theresa May will address the 27 leaders before the dinner in a last-ditch bid to win them over; though she will not be allowed into the main discussion itself.

Russia and Assad delayed their final offensive to offer the jihadists a way out. But now these are refusing to leave.

• Syria’s Chessboard (Hallinan)

The Syrian civil war has always been devilishly complex, with multiple actors following different scripts, but in the past few months it appeared to be winding down. The Damascus government now controls 60 percent of the country and the major population centers, the Islamic State has been routed, and the rebels opposed to Syrian President Bashar al-Assad are largely cornered in Idilb Province in the country’s northwest. But suddenly the Americans moved the goal posts—maybe—the Russians have fallen out with the Israelis, the Iranians are digging in their heels, and the Turks are trying to multi-task with a home front in disarray. So the devil is still very much at work in a war that has lasted more than seven years, claimed up to 500,000 lives, displaced millions of people, destabilized an already fragile Middle East, and is far from over.

There are at least three theaters in the Syrian war, each with its own complexities: Idilb in the north, the territory east of the Euphrates River, and the region that abuts the southern section of the Golan Heights. Just sorting out the antagonists is daunting. Turks, Iranians, Americans and Kurds are the key actors in the east. Russians, Turks, Kurds and Assad are in a temporary standoff in the north. And Iran, Assad and Israel are in a faceoff near Golan, a conflict that has suddenly drawn in Moscow. Assad’s goals are straightforward: reunite the country under the rule of Damascus and begin re-building Syria’s shattered cities. The major roadblock to this is Idilb, the last large concentration of anti-Assad groups, Jihadists linked with al-Qaeda, and a modest Turkish occupation force representing Operation Olive Branch. The province, which borders Turkey in the north, is mountainous and re-taking it promises to be difficult.

For the time being there is a stand down. The Russians cut a deal with Turkey to demilitarize the area around Idilb city, neutralize the jihadist groups, and re-open major roads. The agreement holds off a joint Assad-Russian assault on Idilb, which would have driven hundreds of thousands of refugees into Turkey and likely have resulted in large numbers of civilian casualties. But the agreement is temporary—about a month—because Russia is impatient to end the fighting and begin the reconstruction. However, it is hard to see how the Turks are going to get a handle on the bewildering number of groups packed into the province, some of which they have actively aided for years. Ankara could bring in more soldiers, but Turkey already has troops east of the Euphrates and is teetering on the edge of a major economic crisis.

Debt Rattle September 22 2018

Sep 222018

September 22, 2018 Posted by Raúl Ilargi Meijer at 9:21 am Finance Tagged with: Assange, Brexit, Ecuador, Google, Grassley, Kavanaugh, Le Pen, May, NYT, Rosenstein, Syria, Trump 3 Responses »

René Magritte Memory of a voyage 1955

• Rosenstein Proposed Secretly Recording Trump, Invoking 25th Amendment (ZH)

• NY Times, McCabe Give Trump Perfect Cover To Fire Rosenstein, Sessions (Hill)

• Grassley Extends Deadline On Kavanaugh Accuser’s Decision To Testify (Pol.)

• Ding Dong…. (Jim Kunstler)

• Theresa May Demands European Leaders Show UK Respect (Ind.)

• Legal Action To Revoke Article 50 Referred To European Court Of Justice (G.)

• UK PM May Facing Ministerial Resignations Over Brexit Plan (R.)

• Russia, Turkey Agree Borders Of Syria Demilitarised Zone (AFP)

• Google Suppresses Memo Revealing Plans To Track Search Users In China (IC)

• French Court Orders Psychiatric Assessment of Marine Le Pen (Sp.)

• Russia’s Secret Plan To Help Julian Assange Escape From UK (G.)

• Ecuador Pledged to Not Kick Out Assange – Lawyer (RT)

• Ecuador Reportedly Mulled Sending Assange As A Diplomat To Russia (RT)

The New York Times now helps Trump, or do they think this hurts him?

• Rosenstein Proposed Secretly Recording Trump, Invoking 25th Amendment (ZH)

[..] the NYT recounted on Friday an aborted mutiny attempt organized by Rosenstein, who allegedly tried to organize members of Trump’s cabinet to invoke the 25th amendment to oust Trump from office. In an attempt to persuade the clearly reluctant members of Trump’s cabinet, Rosenstein suggested that he or other officials should secretly tape Trump “to expose the chaos” he said was engulfing the West Wing. According to NYT, the sources were either briefed on Rosenstein’s plans, or learned about it from the files of former FBI Deputy Director Andrew McCabe, who was fired after being disgraced by an inspector general investigation. ABC News, which also reported the story, cited sources familiar with McCabe’s files. A grand jury is also weighing whether to press charges against McCabe for allegedly misleading the inspector general.

“Mr. Rosenstein made the remarks about secretly recording Mr. Trump and about the 25th Amendment in meetings and conversations with other Justice Department and F.B.I. officials. Several people described the episodes, insisting on anonymity to discuss internal deliberations. The people were briefed either on the events themselves or on memos written by F.B.I. officials, including Andrew G. McCabe, then the acting bureau director, that documented Mr. Rosenstein’s actions and comments. None of Mr. Rosenstein’s proposals apparently came to fruition. It is not clear how determined he was about seeing them through, though he did tell Mr. McCabe that he might be able to persuade Attorney General Jeff Sessions and John F. Kelly, then the secretary of homeland security and now the White House chief of staff, to mount an effort to invoke the 25th Amendment.”

[..] Mr. Rosenstein disputed this account. “The New York Times’s story is inaccurate and factually incorrect,” he said in a statement. “I will not further comment on a story based on anonymous sources who are obviously biased against the department and are advancing their own personal agenda. But let me be clear about this: Based on my personal dealings with the president, there is no basis to invoke the 25th Amendment.”

Yeah, strange things are happening…

• NY Times, McCabe Give Trump Perfect Cover To Fire Rosenstein, Sessions (Hill)

It has been a year of ironies: President Trump’s personal lawyer, Michael Cohen, once said he would take a bullet for Trump and now seeks to destroy him (and to do so pro bono). Sen. Ted Cruz (R-Texas) once denounced Trump for suggesting Cruz’s father was a presidential assassin but now politically relies on and praises the man who called him “Lying Ted.” The greatest irony of all, however, could be how the newspaper that Trump loves to call “the failing New York Times” succeeded in delivering to him what he has long wanted: a clean shot at firing Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein, and then installing a new AG to oversee special counsel Robert Mueller.

To make this more bizarre, Trump could rely for all this on the man he publicly called on to be fired and possibly prosecuted — former FBI Acting Director Andrew McCabe. The Times dropped a bombshell story late Friday that Rosenstein discussed secretly recording Trump and seeking cabinet support to force him out of office as being incapacitated under the 25h Amendment. Rosenstein denies the story as “inaccurate and factually incorrect,” insisting “there is no basis to invoke the 25th Amendment.” However, McCabe reportedly wrote memos stating that Rosenstein did discuss the possibility of taping and entrapping the president. Trump has previously referred to McCabe’s memos as “fake.”

At least one source has said the comments about secret taping were made in jest. Of course, joking about secretly taping your boss or forcing him from office is not a huge improvement, particularly when you are technically controlling a special counsel’s investigation of the president. Even in jest, it fulfills Trump’s long narrative of a Justice Department set against him from the outset. So how could the Times clear the way for Trump to clean house at Justice and end up with Mueller directly controlled by an attorney general of his choosing? Simple.

The Kavanaugh story tries hard to be even more absurd than the Rosenstein one.

• Grassley Extends Deadline On Kavanaugh Accuser’s Decision To Testify (Pol.)

[..] late Friday, Grassley tweeted: “Five times now we hv granted extension for Dr Ford to decide if she wants to proceed w her desire stated one wk ago that she wants to tell senate her story Dr Ford if u changed ur mind say so so we can move on I want to hear ur testimony. Come to us or we to u.” Minutes later, he added: “Judge Kavanaugh I just granted another extension to Dr Ford to decide if she wants to proceed w the statement she made last week to testify to the senate She shld decide so we can move on I want to hear her. I hope u understand. It’s not my normal approach to b indecisive.”

Grassley followed with a candid lament that he was being outmaneuvered by Democrats: “With all the extensions we give Dr Ford to decide if she still wants to testify to the Senate I feel like I’m playing 2nd trombone in the judiciary orchestra and [Senate Minority Leader Chuck] Schumer is the conductor.” Grassley and other Republicans want Ford to appear on Wednesday, though Ford has requested a Thursday appearance. They accepted some of Ford’s requests after holding a conference call on Friday morning such as allowing one camera in the room, making sure Kavanaugh and Ford aren’t in the same hearing room at the same time and giving Ford breaks during testimony as well as security from the U.S. Capitol Police.

“Fourth Turning horror show with whipped cream and a cherry on top…”

• Ding Dong…. (Jim Kunstler)

This might come as a shock to readers, but the time is not far off when the remaining not-insane cohort of adult Americans gets good and goddamn sick of political sex bombing. Especially given this case of shuck-and-jive. Consider that the same CNN this week produced an entire segment about the shape and size of the President’s generative organ (as reported by an expert in these matters, the porn star and prostitute known as Stormy Daniels). It must be a subject of extraordinary interest to CNN’s Anderson Cooper. On the other flank of the news this week is the much more perilous showdown between the Department of Justice (and the FBI), and Mr. Trump, the cis-hetero-white Golem who happens to be president.

He has ordered these agencies to produce a set of un-redacted documents pertaining to the long-running Russia investigation, set into motion by personnel at these very places. It’s his prerogative under the constitution to do that. In turn, these agencies are being egged on by possibly culpable characters in this melodrama, such as former CIA Director John Brennan and Congressman Adam Schiff (D-Cal), to stonewall the Golem. If I were president — and I may get there yet — I’d send federal marshals into Rod Rosenstein’s office to seize these documents before they are mysteriously “lost.” A tremendous tension hangs over this transaction. Imagine the awful possibility that Mr. Trump may have to declare some kind of martial law to roust out these seditious rascals and clean up their departments. There’s your Fourth Turning horror show with whipped cream and a cherry on top.

There are plenty other plans. She just doesn’t like them.

• Theresa May Demands European Leaders Show UK Respect (Ind.)

Theresa May has demanded EU leaders show Britain respect, branding their public rejection of her Brexit proposals “not acceptable”. In a statement at Downing Street, the prime minister hit out at the way European Council President Donald Tusk discarded her plans without giving a detailed explanation or offering alternatives. Ms May said neither of the options previously offered by the EU were acceptable, stated that talks are now at an “impasse” and underlined her willingness to walk away if needs be – finishing with the words “we stand ready”. But the prime minister also made a new pledge to guarantee the rights of EU citizens living and working in the UK, even in the event of a no-deal Brexit.

Her intervention won approval from cabinet Brexiteers and to an extent from MPs on Conservative benches, steadying a volatile political situation which hours earlier had seen critics predicting the collapse of her strategy. Mr Tusk had surprised British officials by making an unexpectedly strong statement at the end of a summit in Salzburg this week, saying Ms May’s proposals for Brexit “will not work” and following it up with a social media post mocking her negotiating strategy. With pressure mounting, Ms May acknowledged from inside No.10 that Mr Tusk said the UK proposals would undermine the single market, but added: “He didn’t explain how in any detail or make any counter-proposal. So we are at an impasse.”

She said: “Throughout this process, I have treated the EU with nothing but respect. The UK expects the same. A good relationship at the end of this process depends on it. “At this late stage in the negotiations, it is not acceptable to simply reject the other side’s proposals without a detailed explanation and counter proposals. “So we now need to hear from the EU what the real issues are and what their alternative is so that we can discuss them. Until we do, we cannot make progress.”

Someone in Scotland’s been digging into the law.

• Legal Action To Revoke Article 50 Referred To European Court Of Justice (G.)

A legal action to establish whether the UK can unilaterally stop Brexit has been referred to the European court of justice by the court of session in Edinburgh. The case was brought by a cross-party group of six Scottish MPs, MEPs and MSPs, who want the ECJ to offer a definitive ruling on whether the UK can halt the article 50 process without needing the approval of all other 27 EU member states. Rejecting the argument put forward by lawyers for the UK government, that ministers have repeatedly made it clear they have no intention of stopping the Brexit process, even if there were no deal with the EU, Scotland’s most senior judge, Lord Carloway, said: “It seems neither academic nor premature to ask whether it is legally competent to revoke the notification and thus to remain in the EU.”

Carloway, one of three judges to consider the case on appeal after it was initially rejected in June as “academic and hypothetical”, noted that the Commons would be required to vote on whether to ratify any Brexit deal before 29 March 2019, “a date which is looming up”, and that a judgment from the ECJ would “have the effect of clarifying the options open to MPs in the lead-up to what is now an inevitable vote”. Lord Menzies said: “There will have to be a vote, and it appears to me to be legitimate for those who are involved in that vote to know, by means of a judicial ruling, the proper legal meaning of article 50, and in particular whether a member state which has given notification of its intention to withdraw from the EU may revoke that notification of intention unilaterally before the expiry of two years after the notification.”

Monday could be good. New plans are demanded, but there’s no time for them.

• UK PM May Facing Ministerial Resignations Over Brexit Plan (R.)

Some of British Prime Minister Theresa May’s ministers will demand a “Plan B” on her Brexit proposal next week and could quit if she does not change course, the Telegraph newspaper reported late on Friday, citing unnamed sources. Ministers will demand an alternative plan to her “Chequers” proposal at a Cabinet meeting on Monday, the Telegraph said. That plan had already been savaged by European Union leaders in Salzburg earlier in the week, prompting May to defiantly challenge leaders of the bloc to come up with its own plans. Pro-Brexit members of May’s party on Friday had welcomed her defiant tone, but her Chequers proposal has many domestic critics, too.

The Telegraph said there was “speculation” that work and pensions minister Esther McVey might walk out of Monday’s meeting if no new proposal was presented, while international development minister Penny Mordaunt was also tipped as a possible resignation candidate, though the newspaper said friends denied she would resign. Earlier on Friday, Mordaunt said that the EU’s attitude was increasing support within Britain for an exit from the bloc, even if it meant leaving without a deal. .

Let’s hope Russia got this one right.

• Russia, Turkey Agree Borders Of Syria Demilitarised Zone (AFP)

Russia and Turkey have agreed on borders of a demilitarised zone in northern Syria, Russia’s top diplomat said Friday, part of a deal that could check an assault on the last rebel enclave in Idlib. “Just yesterday or the day before, the militaries of Russia and Turkey agreed the concrete frontiers of the demilitarised zone,” Russian Foreign Minister Sergei Lavrov said after talks with his Bosnian counterpart Igor Crnadak. Moscow says the demilitarised zone would help stop attacks from Idlib on Syrian army positions and Russia’s military bases in the region. Russian President Vladimir Putin and Turkish counterpart Recep Tayyip Erdogan agreed the establishment of the 15 to 20 kilometre (9.3-12 miles) buffer zone on Monday after talks that lasted more than four hours.

Security in the zone, which includes parts of Idlib and neighbouring provinces including the city of Aleppo, will be overseen by Turkish contingents and Russian military police. The agreement will prevent military action against the city of Idlib, Russia’s defence minister said. “It’s an intermediate step… but a necessary step,” Lavrov said of the zone. “By mid-October, all (fighters of the Al-Nusra Front) must leave this demilitarised zone, and all heavy military equipment must be pulled out of there,” he said.

Practising for the west?

• Google Suppresses Memo Revealing Plans To Track Search Users In China (IC)

Google bosses have forced employees to delete a confidential memo circulating inside the company that revealed explosive details about a plan to launch a censored search engine in China, The Intercept has learned. The memo, authored by a Google engineer who was asked to work on the project, disclosed that the search system, codenamed Dragonfly, would require users to log in to perform searches, track their location — and share the resulting history with a Chinese partner who would have “unilateral access” to the data. The memo was shared earlier this month among a group of Google employees who have been organizing internal protests over the censored search system, which has been designed to remove content that China’s authoritarian Communist Party regime views as sensitive, such as information about democracy, human rights, and peaceful protest.

According to three sources familiar with the incident, Google leadership discovered the memo and were furious that secret details about the China censorship were being passed between employees who were not supposed to have any knowledge about it. Subsequently, Google human resources personnel emailed employees who were believed to have accessed or saved copies of the memo and ordered them to immediately delete it from their computers. Emails demanding deletion of the memo contained “pixel trackers” that notified human resource managers when their messages had been read, recipients determined.

For posting ISIS execution pictures.

• French Court Orders Psychiatric Assessment of Marine Le Pen (Sp.)

The request is connected with a series of images she posted on Twitter showing Daesh* executions. France’s National Rally party leader Marine Le Pen took to Twitter to express her anger with the court order. “I thought I had been through it all: well, no! For denouncing the horrors of Daesh (Isis) with tweets, the “justice system” has referred me for a psychiatric assessment. How far will they go?!” she said. “This regime is really starting to be frightening,” Le Pen added. Le Pen noted that, contrary to French media reports, the procedure was not customary. According to a decision made on September 11, which Le Pen posted on Twitter, the purpose of the psychiatric assessment was to answer the question: “Can she [Le Pen] understand the statements and answer the questions.”

In the list of questions given to the experts, there were eight points, among which were: “whether she acted under the influence of forces or circumstances of force majeure” as well as “is she in a dangerous state from the standpoint of psychiatry or forensic science, and what is the forecast,” among others. The National Assembly (lower house of parliament) of France in November 2017, at the request of the Nanteré Prosecutor’s Office, deprived Le Pen of parliamentary immunity in connection with the publication on Twitter. If the French court finds her guilty, the leader of the party may face up to three years in prison and a fine of 75,000 euros.

More Guardian smear, sources that are known have long been discredited, Mueller’s allegations have been keelhauled, anonymous sources are suspect.

• Russia’s Secret Plan To Help Julian Assange Escape From UK (G.)

Russian diplomats held secret talks in London last year with people close to Julian Assange to assess whether they could help him flee the UK, the Guardian has learned. A tentative plan was devised that would have seen the WikiLeaks founder smuggled out of Ecuador’s London embassy in a diplomatic vehicle and transported to another country. One ultimate destination, multiple sources have said, was Russia, where Assange would not be at risk of extradition to the US. The plan was abandoned after it was deemed too risky. The operation to extract Assange was provisionally scheduled for Christmas Eve in 2017, one source claimed, and was linked to an unsuccessful attempt by Ecuador to give Assange formal diplomatic status.

The involvement of Russian officials in hatching what was described as a “basic” plan raises new questions about Assange’s ties to the Kremlin. The WikiLeaks editor is a key figure in the ongoing US criminal investigation into Russia’s attempts to sway the outcome of the 2016 presidential election. Robert Mueller, the special counsel conducting the investigation, filed criminal charges in July against a dozen Russian GRU military intelligence officers who allegedly hacked Democratic party servers during the presidential campaign. The indictment claims the hackers sent emails that embarrassed Hillary Clinton to WikiLeaks. The circumstances of the handover are still under investigation. According to Mueller, WikiLeaks published “over 50,000 documents” stolen by Russian spies. The first tranche arrived on 14 July 2016 as an encrypted attachment. Assange has denied receiving the stolen emails from Russia.

Very promising.

• Ecuador Pledged to Not Kick Out Assange – Lawyer (RT)

Despite widespread speculation a few months ago that WikiLeaks founder Julian Assange may be kicked out of the Ecuadorian embassy by the country’s new leadership, his asylum seems to be safe for now, his lawyer told RT. In July, there were numerous reports that Ecuador’s president, Lenin Moreno, may revoke the political asylum given to Assange by his predecessor, Rafael Correa, as part of an effort to establish closer ties with the US. The threat never materialized, but his long-time lawyer said “anything could happen at any time.” “Ecuador has made it clear in the past few months – after this wide-spread speculation that he would be forced to leave – that they will respect the asylum,” she said.

Assange remains cut off from all communications and kept in what is effectively solitary confinement with no access to outdoor areas. His health is deteriorating, and the UK authorities have made sure that he won’t get treatment without leaving the embassy, she said. Assange was granted asylum in August 2012, skipping bail in the UK justice system. At that time, he was fighting extradition to Sweden, where he faced prosecution over a now-closed case over alleged sex offenses. He said he had to seek Ecuador’s protection because if forced to go to Sweden, he could be extradited to the US and face serious charges over his actions as WikiLeaks founder.

Would have been a good solution.

• Ecuador Reportedly Mulled Sending Assange As A Diplomat To Russia (RT)

London refused to grant WikiLeaks founder Julian Assange diplomatic immunity so he could escape the confinement of the Ecuadorian embassy in the UK and relocate to Russia, Reuters reports, citing government communications. The persona of Julian Assange has become a thorn in Ecuador’s president Lenin Moreno’s side and, ever since assuming office in May of last year, Moreno has made every effort to make sure the Australian’s stay at Ecuador’s embassy in London comes to an end as soon as possible. To shift the responsibility for Assange’s protection against US persecution, Ecuador allegedly mulled offering the WikiLeaks founder a diplomatic post in Russia, which the country hoped would enable him –protected by diplomatic immunity– to finally leave the embassy after six years of arbitrary detention.

London, however, refused to honor Moreno’s move to authorize “special designation” for 47-year-old to carry out diplomatic functions in Moscow, and declined to grant the whistleblower a free passage out of the country, Reuters reports, citing a letter by Ecuador’s foreign ministry to opposition legislator Paola Vintimilla. According to the letter, Quito abandoned its idea to relocate the whistleblower to Moscow after the UK Foreign Office refused to recognize Assange’s special status, or any privileges and immunities awarded under the Vienna Convention on Diplomatic Relations. The “special designation” status awarded by the Ecuadorian president would allow Assange to hold diplomatic posts abroad even if the whistleblower is not career diplomat. However, under English law, the 47 year-old can only enjoy diplomatic privileges, such as immunity, only if his credentials are accepted by the Foreign Office.

[..] Citing at least four, traditionally anonymous, sources, the Guardian wrote that Moscow was plotting to smuggle Assange out of London on Christmas eve last year, but dropped the plan because it was “deemed too risky.” The paper, claimed that Ecuador’s former London consul, Fidel Narvaez, was in talks with Russian diplomats and in constant contact with a ‘Russian businessman’ who coordinated the proposed operation with the Kremlin. It took the newspaper a mere five paragraphs of its 1,000-word report to bring up “questions about Assange’s ties to the Kremlin” in the context of the notorious Mueller probe and alleged ‘Russian hacking’ of the US elections.

Debt Rattle September 19 2018

Sep 192018

September 19, 2018 Posted by Raúl Ilargi Meijer at 8:55 am Finance Tagged with: Amazon, Bernie Sanders, Brexit, Corbyn, FBI, junk, Korea, Monsanto, Syria, tariffs, Tesla, Trump, Walmart 7 Responses »

Salvador Dali Landscape with butterflies 1956

• Trump: Exposing ‘Corrupt’ FBI Probe Could Be Crowning Achievement (Hill)

• Trump: Expect Decision On US Role In Syria Soon (ZH)

• China Hits Back At US With $60 Billion Of New Tariffs (G.)

• Just How Wildly Exuberant is the Junk-Credit Market?” (WS)

• Bernie Sanders’ Anti-Amazon Bill Is an Indictment of the Media, Too (Taibbi)

• North And South Korea Sign Joint Agreement In ‘Leap Forward’ For Peace (Ind.)

• Michel Barnier Rebuffs UK Calls For Flexibility On Irish Border (G.)

• Keir Starmer Clashed With Corbyn On Brexit ‘To Brink Of Resignation’ (G.)

• Rightwing Thinktanks Unveil Radical Plan For US-UK Brexit Trade Deal (G.)

• Tesla To Be Investigated By US DOJ Over Elon Musk Tweets (Ind.)

• Monsanto Asks US Court To Toss $289 Million Glyphosate Verdict (R.)

Let’s see what the declassified files have to say.

• Trump: Exposing ‘Corrupt’ FBI Probe Could Be Crowning Achievement (Hill)

President Trump in an exclusive interview with Hill.TV said Tuesday he ordered the release of classified documents in the Russia collusion case to show the public the FBI probe started as a “hoax,” and that exposing it could become one of the “crowning achievements” of his presidency. “What we’ve done is a great service to the country, really,” Trump said in a 45-minute, wide-ranging interview in the Oval Office. “I hope to be able to call this, along with tax cuts and regulation and all the things I’ve done… in its own way this might be the most important thing because this was corrupt,” he said. Trump also said he regretted not firing former FBI Director James Comey immediately instead of waiting until May 2017 [..]

“If I did one mistake with Comey, I should have fired him before I got here. I should have fired him the day I won the primaries,” Trump said. “I should have fired him right after the convention, say I don’t want that guy. Or at least fired him the first day on the job. … I would have been better off firing him or putting out a statement that I don’t want him there when I get there.” [..] He criticizing the Foreign Intelligence Surveillance Act (FISA) court’s approval of the warrant that authorized surveillance of Carter Page, a low-level Trump campaign aide, toward the end of the 2016 election, suggesting the FBI misled the court.

“They know this is one of the great scandals in the history of our country because basically what they did is, they used Carter Page, who nobody even knew, who I feel very badly for, I think he’s been treated very badly. They used Carter Page as a foil in order to surveil a candidate for the presidency of the United States.” [..] The president spared no words in criticizing Comey, former FBI deputy director Andrew McCabe, counterintelligence agent Peter Strzok, lawyer Lisa Page and other FBI officials who started the probe. He recited specific text messages Page and Strzok traded while having an affair and investigating his campaign, arguing the texts showed they condoned leaks and conducted a bogus probe. Those texts are to be released as a result of Trump’s announcement on Monday. “It’s a hoax, beyond a witch hunt,” he said.

If only that could be true:“Is it possible that Trump will take the window of opportunity to get out of Syria, and walk back from prior US threats?”

Putin’s deal with Turkey has made US threats empty: civilians and terrorists will be separated. Israel has no reason to bomb anything either.

• Trump: Expect Decision On US Role In Syria Soon (ZH)

President Trump indicated that a decision on the future of US policy in Syria is coming soon in remarks made at a press conference with his Polish counterpart. Speaking alongside President Andrzej Duda, Trump said the Monday night downing of a Russian maritime surveillance plane by accidental Syrian friendly fire was “a very sad thing”. Trump’s remarks did not include criticism of Putin, and seemed to signal regret over Monday night’s dramatic escalation over Syria after a massive Israeli attack. Earlier in the day Tuesday, Russia had pointed the finger at Israel for purposefully provoking the mishap, something Israel has since denied in a military statement that ultimately put blame on Assad, Iran, and Hezbollah.

Trump also said that the US fight against ISIS in Syria could end soon: “We’re very close to being finished with that job,” he said of the Pentagon mission against ISIS. He followed with: “And then we’re going to make a determination as to what we’re going to do.” [..] Only months ago the president expressed a desire “to get out” and pull the over 2,000 publicly acknowledged American military personnel from the country; but the new report said that Trump has approved “an indefinite military and diplomatic effort in Syria”. The report revealed that “the administration has redefined its goals to include the exit of all Iranian military and proxy forces from Syria, and establishment of a stable, nonthreatening government acceptable to all Syrians and the international community.”

But is it possible that Monday’s attack involving missiles flying over the Mediterranean and an “accidental” downing of a Russian plane and 15 dead Russian crew members might have jolted Trump back to his prior position of wanting to withdraw from the Syrian quagmire? [..] Monday’s events also came just after Russian President Putin and his Turkish counterpart Recep Tayyip Erdogan announced that a demilitarized zone in Idlib will be formed by October 15. [..] The Russia-Turkey deal over Idlib has at least temporarily deflated US threats that it could intervene should Syria launch a brutal assault on the province —something the US promised to do especially if chemical weapons are used. Is it possible that Trump will take the window of opportunity to get out of Syria, and walk back from prior US threats?

Go sit around a table, all of you, including EU and japan.

• China Hits Back At US With $60 Billion Of New Tariffs (G.)

China is to slap tariffs on an additional $60bn of imports from the US in retaliation against $200bn of new trade sanctions on Chinese goods announced by Donald Trump. The latest moves represent a new step towards a full-scale trade war between the world’s two biggest economies. Further escalation is deemed likely because Trump is facing low approval ratings ahead of the US midterm elections in November, while China will not want to be seen to back down. Trump announced his latest escalation of the bitter trade standoff late on Monday, promising to introduce the additional border taxes of 10% on Chinese goods from next week.

The tariffs – designed to make US domestic products more competitive against foreign imports – apply to almost 6,000 items, including consumer goods such as luggage and electronics, housewares and food. The US president threatened further tariffs on an additional $276bn of goods if Beijing unveils retaliatory measures – a step that would mean tariffs on all Chinese imports to the US and equate to 4% of world trade. Early on Tuesday he tweeted to accuse China of “actively trying to impact and change our election by attacking our farmers, ranchers and industrial workers because of their loyalty to me”. The US president added: “What China does not understand is that these people are great patriots and fully understand that China has been taking advantage of the United States on trade for many years.

‘Buying’ a company and loading it up with lousy debt. Business 101.

• Just How Wildly Exuberant is the Junk-Credit Market?” (WS)

This is considered a door-opener Leveraged Buyout (LBO): If it flies and investors buy this $13.5 billion pile of deeply junk-rated debt today, even riskier and bigger LBOs may fly. It’s the fourth largest LBO since the Financial Crisis and the ninth largest of all times in the US and Europe: Thomson Reuters Corporation is separating its largest division, the financial information, analysis, and risk businesses, now called “Refinitiv,” to sell a 55% stake to a group of investors led by private equity firm Blackstone Group. This being a “leveraged” buyout, the Blackstone consortium is making the target company, Refinitiv, borrow in total $13.5 billion to fund most of its own buyout. This consist of $9.25 billion in “leveraged loans” and $4.25 billion in secured and unsecured bonds.

Some pieces are denominated in dollars, others in euros. This debt sale is being completed today. The Blackstone Consortium will infuse $3.025 billion in cash equity. Thomson Reuters will retain a 45% stake and will receive a special dividend from Refinitiv of approximately $17 billion, according to Moody’s. And there are some other details involved. Alas, Moody’s gives Refinitiv a corporate credit rating of B3, six steps into junk, considered “highly speculative.” [..] This deal is “reminiscent of the kind of deal I would have seen in 2006 and 2007,” Scott Roberts, head of high-yield investments at Invesco, told the Wall Street Journal. In addition to the large amount of debt being issued, “you have a covenant package that’s extremely weak.”

OK, but weak covenants have become a pandemic. Companies issuing leveraged loans love weak covenants, and creditors will rue the day, but for now everything flies. The share of these so-called “covenant-lite” (“cov-lite”) loans compared to all leveraged loans outstanding keeps setting new records. LCD of S&P Global Market Intelligence reported today that cov-lite loans in August accounted for 78.6% of outstanding leveraged loans, and up from 55% in mid-2014:

Globalism hollows out economies. And societies.

• Bernie Sanders’ Anti-Amazon Bill Is an Indictment of the Media, Too (Taibbi)

[..] it’s become increasingly clear that [Bernie Sanders] lost patience waiting for the news media to pay attention to this particularly loathsome problem of CEOs using public subsidies to pad their bottom lines. The issue in his campaigns against companies like Disney, Walmart, Burger King and Amazon is simple: our biggest and most successful companies use a business model that involves giant workforces earning beneath-subsistence wages, if not worse (particularly abroad). This business model would not work without the active cooperation of governments around the world.

Amazon and Walmart are particular villains on this score. On the supply end, they gobble up super-cheap products assembled in unfree labor zones like China, where workers are treated so badly that some have threatened mass suicides to improve conditions. Then, on the distribution end, in wealthy consumer countries like the U.S., these same companies pay many workers such low wages that they end up on public assistance. One study showed that in Arizona, for instance, 1 in 3 Amazon workers are on food stamps. Meanwhile, Jeff Bezos is worth $160 billion, and, according to one infuriating study, earns the median salary of an Amazon employee every nine seconds.

If you go by net worth in stock holdings, Bezos earns about $277 million a day. This set of circumstances is a profound comment on how the modern global economy functions. Misguided policies like the establishment of Permanent Normal Trade Relations (PNTR) with China long ago committed us to a world in which the industrial democracies of the West would be increasingly reliant upon human rights abusers in places like China to serve as mercantile suppliers. As manufacturing headed to the third world, domestic distributors became concentrated and de-unionized.

They really want peace. Don’t stand in their way.

• North And South Korea Sign Joint Agreement In ‘Leap Forward’ For Peace (Ind.)

The North and South Korean leaders presented a joint agreement during their summit in Pyongyang on Wednesday that Kim Jong-un said represented a “leap forward” for peace on the peninsula. At a joint press conference after the signing, South Korea’s Moon Jae-in said North Korea had agreed to “permanently” shut down all of its nuclear and missile testing facilities, in the presence of international experts, as long as the US takes reciprocal measures. The two sides agreed that Mr Kim would visit Seoul, in what would be a first for a North Korean leader. And the two leaders agreed a number of wide-ranging measures designed to increase cooperation and reduce the risk of armed clashes on the border.

Mr Kim said the pair had agreed to turn the Korean peninsula into a “land of peace without nuclear weapons and nuclear threats”. The US had called for concrete developments regarding denuclearisation during Mr Moon’s three-day visit to Pyongyang, and Donald Trump suggested the joint agreement did not disappoint. “Very exciting!” was his response to the news on Twitter. “Kim Jong-un has agreed to allow nuclear inspections, subject to final negotiations, and to permanently dismantle a test site and launch pad in the presence of international experts. In the meantime there will be no Rocket or Nuclear testing,” Mr Trump said.

Trying to paint the picture that if only the EU wanted to, it could give the UK whatever it desires.

• Michel Barnier Rebuffs UK Calls For Flexibility On Irish Border (G.)

Michel Barnier has rebuffed British calls for the EU to change its stance on the contested issue of the Irish border, and said a “moment of truth” was fast approaching on a Brexit deal. The EU’s chief negotiator said the bloc was ready “to improve” its proposal on avoiding a hard border on the island of Ireland, but stopped short of accepting British ideas for compromise, after the Brexit secretary, Dominic Raab, called on the EU to show flexibility. “The European Council in October will be the moment of truth, it is the moment when we shall see if we have an agreement,” Barnier said. The Irish border has emerged as the biggest stumbling block to the Brexit deal that Theresa May hopes to strike with the EU this autumn.

While the EU and UK have agreed there should be no hard border to prevent any return to violence, they are deadlocked over how to manage what will become a 310-mile frontier between the UK and EU. Both sides have proposed fallback plans, known as backstops, that would kick into place if trade talks fail to settle the question. The EU’s involves Northern Ireland following EU law on customs and goods, a plan May has said no British prime minister could ever accept. Barnier said the EU was working to improve its proposal, adding that the problem had been caused by “the UK’s decision to leave the EU, its single market and the customs union”. Seeking to counter British criticism that the EU plan eroded UK sovereignty, he said: “What we talking about here is not a land border, not a sea border, it is a set of technical checks and controls. We respect the territorial integrity of the UK and we respect the constitutional order of the UK.”

I include this to show how the Guardian shapes the discussion. After running over 100 headlines aimed at connecting Corbyn and anti-semitism in less than a year, they seamlessly move into internal divisions in Labour. All of this stuff comes from the Blairite neo-liberal side of the party.

• Keir Starmer Clashed With Corbyn On Brexit ‘To Brink Of Resignation’ (G.)

Keir Starmer, the shadow Brexit secretary, was pushed to the brink of resignation early this year after Jeremy Corbyn and his allies tried to kick his customs union plan into the long grass, senior Labour sources have told the Guardian. Labour’s Brexit policy has evolved over the past 18 months through a series of painstaking negotiations between key players at the top of the party, the most fraught of which came at a stormy meeting of the “Brexit subcommittee” early this year. Corbyn’s close allies ambushed Starmer with a paper which shelved the decision on joining a customs union, a policy he had been pushing privately for weeks.

Several people present at the meeting told the Guardian the general feeling in the room was that Starmer was willing to resign rather than accept the proposals, numbered copies of which were handed out at the start of the meeting and retrieved at the end. “He looked close to telling them to shove it – and I think that did count for something,” said one MP present. “I think Jeremy was slightly surprised at how angry Keir was, and how pissed off he was.” Another witness to the confrontation said: “Jeremy started speaking, and Keir just said, enough, this was just completely outrageous. He did lose his temper. I think they were genuinely shocked at his reaction. They tried to bounce him and it completely backfired.”

The ultimate plan all along in some circles.

• Rightwing Thinktanks Unveil Radical Plan For US-UK Brexit Trade Deal (G.)

A radical blueprint for a free trade deal between the UK and the US that would see the NHS opened to foreign competition, a bonfire of consumer and environmental regulations and freedom of movement between the two countries for workers, is to be launched by prominent Brexiters. The blueprint will be seen as significant because of the close links between the organisations behind it and the UK secretary for international trade, Liam Fox, and the US president, Donald Trump. Its publication follows a week of policy launches by the European Research Group of Conservative MPs designed to pressurise the prime minister into “chucking Chequers”, her softer Brexit proposal, in favour of a harder, clean break from the European Union.

The text of the new trade deal has been prepared by the Initiative for Free Trade (IFT) – a thinktank founded by the longtime Eurosceptic MEP Daniel Hannan, one of the leaders of Vote Leave – and the Cato Institute, a rightwing libertarian thinktank in the US founded and funded by the fossil fuel magnates and major political donors the Koch family. The “ideal UK-US free trade deal” was due to be launched later on Tuesday in both London and Washington but the Cato Institute appears to have accidentally posted it online early. The policy initiative was shaped in consultation with a group of other conservative libertarian thinktanks on both sides of the Atlantic, the blueprint explains. These include UK organisations whose funding is opaque, such as the Institute for Economic Affairs (IEA) and the Adam Smith Institute among others in the UK, and others in the US including the Heritage Foundation, the American Enterprise Institute (AEI), and the Competitive Enterprise Institute.

“In the US, the number 420 is associated with April 20, when annual marijuana celebrations take place.”

• Tesla To Be Investigated By US DOJ Over Elon Musk Tweets (Ind.)

The Department of Justice has launched an investigation looking at whether Tesla CEO Elon Musk broke the law by musing on Twitter about taking the company private. The firm was contacted by the Department of Justice after Mr Musk made the comments on Twitter last month in a tweet that spurred theories the tech CEO was trying to communicate he was smoking marijuana because he suggested he would take his company private once shares had reached $420 a share. In the US, the number 420 is associated with April 20, when annual marijuana celebrations take place.

“Last month, following Elon’s announcement that he was considering taking the company private, Tesla received a voluntary request for documents from the DOJ and has been cooperative in responding to it,” a Tesla spokesperson told The Independent in an emailed statement. The spokesperson continued: “We have not received a subpoena, a request for testimony, or any other formal process. We respect the DOJ’s desire to get information about this and believe that the matter should be quickly resolved as they review the information they have received.”

They have limitless legal budgets.

• Monsanto Asks US Court To Toss $289 Million Glyphosate Verdict (R.)

Bayer unit Monsanto on Tuesday asked a California judge to throw out a $289 million jury verdict awarded to a man who alleged the company’s glyphosate-based weed-killers, including Roundup, gave him cancer. The company said in motions filed in San Francisco’s Superior Court of California that the jury’s decision was insufficiently supported by the evidence presented at trial by school groundskeeper Dewayne Johnson. Johnson’s case, filed in 2016, was fast-tracked for trial due to the severity of his non-Hodgkin’s lymphoma, a cancer of the lymph system, that he alleged was caused by years of exposure to Roundup and Ranger Pro, another Monsanto herbicide that contains glyphosate.

Monsanto asked Superior Court Judge Suzanne Bolanos, who oversaw the trial, to set aside the verdict or, in the alternative, reduce the award or grant a new trial. A hearing on the motions is set for Oct. 10. The company, which denies the allegations, has previously said it would appeal the verdict if necessary. Johnson’s case was the first to go to trial over allegations that glyphosate causes cancer. Monsanto is facing some 8,000 similar lawsuits across the United States. Shares in Bayer, which bought Monsanto this year for $63 billion, slid following the Aug. 10 jury decision and the stock was still trading some 20 percent below its pre-verdict value of 73.30 euros ($85.45) on Tuesday.

“The jury’s decision is wholly at odds with over 40 years of real-world use, an extensive body of scientific data and analysis … which support the conclusion that glyphosate-based herbicides are safe for use and do not cause cancer in humans,” Bayer said in a statement on Tuesday. Bayer said Johnson failed to prove glyphosate caused his cancer and the scientific evidence he presented at trial “fell well below the causation standard required under California law.”

Debt Rattle September 13 2018

Sep 132018

September 13, 2018 Posted by Raúl Ilargi Meijer at 8:45 am Finance Tagged with: Brexit, crisis, Florence, Google, Hungary, Juncker, Kerry, Logan Act, Mangkhut, Minsky, plastics, Syria 4 Responses »

Henri Matisse Landscape with a bench 1918

• This Will Be The Mother Of All Minsky Moments (Mauldin)

• Leaderless World Is Sleepwalking Into A Financial Crisis – Gordon Brown (G.)

• UK PM May Calls Special Meeting To Discuss ‘No-Deal’ Brexit (CNBC)

• EU Can ‘Certainly Not’ Accept Theresa May’s Single Market Plan – Juncker (Ind.)

• Juncker Calls On EU To Seize Chance To Become Major Sovereign Power (G.)

• Poland Says It Will Block Any EU Sanctions Against Hungary (R.)

• Leaked Video Shows Distraught Google Execs Grappling With Hillary’s Loss (ZH)

• John Kerry Accused Of Violating Logan Act In Secret Iran Talks (ZH)

• US Destroyer Arrives In Mediterranean As Syria Tensions Rise (RT)

• No NGO Rescue Boats Currently In Central Mediterranean (G.)

Two More Potential ‘Garbage Patch’ Zones In World’s Oceans Identified (Ind.)

• Florence To Slow Down, Hammer Carolinas and Appalachia for Days (Weather.com)

The mother of all debt loads.

• This Will Be The Mother Of All Minsky Moments (Mauldin)

Dr. Hyman Minsky points out that stability leads to instability. The more comfortable we get with a given condition or trend, the longer it will persist. And then when the trend fails, the more dramatic the correction. Long-term stability produces unstable financial arrangements. If we believe that tomorrow will be the same as last week, we are more willing to add debt or postpone savings in favor of current consumption. Thus, says Minsky, the longer the period of stability, the higher the potential risk for even greater instability when market participants must change their behavior.

[..] I think the mother of all Minsky moments is building. It will not be an instant sandpile collapse, but instead take years because we have $500 trillion of debt to work through. Remember, that debt just can’t be pooped away. It is both money somebody owes and an asset on somebody else’s balance sheet. We can’t just take that away without huge consequences to culture and society.

All these people responsible for the last crisis are now advising on what to do with the next one.

• Leaderless World Is Sleepwalking Into A Financial Crisis – Gordon Brown (G.)

“It is very difficult to say what will trigger it [the next crisis] but we are at the latter end of the economic cycle where people take greater risks. There are problems in emerging markets.” Brown said one area of concern should be heavy commercial and industrial lending by lightly or unregulated shadow banks at a time when US interest rates are rising. “It could arise in Asia because of the amount of lending through the shadow banking system.” He added: “In an interconnected world there is an escalation of risks. We have had a decade of stagnation and we are now about to have a decade of vulnerability.”

Recalling the freezing up of the financial markets a decade ago, Brown said governments had sought to compensate for the lack of trust between banks by cooperating more closely. “In the next crisis a breakdown of trust in the financial sector would be mirrored by breakdown in trust between governments. There wouldn’t be the same willingness to cooperate but rather a tendency to blame each other for what’s gone wrong.

Waking up at last?

• UK PM May Calls Special Meeting To Discuss ‘No-Deal’ Brexit (CNBC)

The U.K. government is set to meet Thursday morning for three-hours to discuss the eventuality of a “no-deal” Brexit. The meeting takes place at a time when the government is also releasing more than 20 documents, outlining some more preparations in case the U.K. leaves the European Union in March 2019 without a deal. This is not the first set of papers outlining what will happen in case the U.K. and the EU do not reach a deal. In late August, the U.K. government said that businesses should prepare for higher barriers to trade, more red tape and potentially higher costs too, if Brexit talks collapse.

All these steps are part of a wider attempt to step up works for the worst-case scenario. The EU has also strengthened its preparations in case the U.K. leaves the bloc abruptly. The U.K.’s Brexit chief, Dominic Raab, warned on Wednesday that the U.K. will not pay the so-called divorce bill, if there is no final deal over Brexit. Raab wrote in the Daily Telegraph that the £39 billion ($50.82 billion) the U.K. owes to the EU, due to previous policy agreements, will not be repaid if there is no deal.

We know.

• EU Can ‘Certainly Not’ Accept Theresa May’s Single Market Plan – Juncker (Ind.)

Jean-Claude Juncker has given his clearest signal yet that the EU will not accept Theresa May’s plan to keep Britain in the single market for goods after Brexit. In his annual state of the union address in Strasbourg, the European Commission president said parts of the single market could “certainly not” be jettisoned for countries outside the bloc. But he said the Chequers proposals could be a “starting point” for the future relationship and that Britain would “never be an ordinary” country for the EU. “We respect the British decision to leave our union, even though we continue to regret it deeply,” he told MEPs. “But we also ask the British government to understand that someone who leaves the union cannot be in the same privileged position as a member state.

Bigger is better?!

• Juncker Calls On EU To Seize Chance To Become Major Sovereign Power (G.)

In his state of the union speech, titled The Hour of European Sovereignty, the European commission president appealed to MEPs and heads of government to give the EU the powers and characteristics traditionally restricted to states. Explaining his expansive vision, Juncker said the EU should aim to surpass the dominance of the dollar in the world economy and challenge China in its attempts to become the ascendant influence in Africa. The EU should be “a global player” as well as a “global payer”, Juncker said, with foreign policy decisions made on the basis of a qualified majority vote in which the will of 55% of member states would win the day.

Through trade deals, the EU’s standards and labour conditions were being exported across the world, he said, and it was time for the continent to further use its “clout” to mould the future. “The geopolitical situation makes this Europe’s hour: the time for European sovereignty has come,” Juncker told the European parliament in Strasbourg. “It is time Europe took its destiny into its own hands. It is time Europe developed what I coined Weltpolitikfähigkeit – the capacity to play a role, as a union, in shaping global affairs. Europe has to become a more sovereign actor in international relations.”

A crumbling fortress.

• Poland Says It Will Block Any EU Sanctions Against Hungary (R.)

Poland, the biggest former communist country in the European Union, said it will oppose any sanctions imposed by the bloc on fellow member Hungary, accused of floating EU rules on democracy. “Every country has its sovereign right to make internal reforms it deems appropriate,” Poland’s foreign ministry said in a statement late on Wednesday. “Actions aimed against member states serve only deepening divides in the EU, increasing citizens’ current lack of confidence to European institutions.” The European Parliament voted on Wednesday to sanction Hungary for neglecting norms on democracy, civil rights and corruption in a first bid to launch the punitive process of the EU treaty’s Article 7.

AI to save their day?

• Leaked Video Shows Distraught Google Execs Grappling With Hillary’s Loss (ZH)

Days after Google was exposed trying to help Hillary Clinton win the 2016 election, a leaked “internal only” video published by Breitbart Senior Tech correspondent Allum Bokhari reveals a panel of Google executives who are absolutely beside themselves following Hillary Clinton’s historic loss. The video is a full recording of Google’s first all-hands meeting following the 2016 election (these weekly meetings are known inside the company as “TGIF” or “Thank God It’s Friday” meetings). Sent to Breitbart News by an anonymous source, it features co-founders Larry Page and Sergey Brin, VPs Kent Walker and Eileen Naughton, CFO Ruth Porat, and CEO Sundar Pichai. -Breitbart

In the video, Brin can be heard comparing Trump supporters to fascists and extremists – arguing that like other extremists, Trump voters suffered from “boredom” which has, he claims, historically led to fascism and communism. He then asks his company what they can do to ensure a “better quality of governance and decision-making.” And according to Kent Walker, VP for Global Affairs, those who support populist causes like the MAGA movement are motivated by “fear, xenophobia, hatred and a desire for answers that may or may not be there.” He later says that Google needs to fight to ensure that populist movements around the world are merely a “blip” and a “hiccup” in the arc of history that “bends towards progress.”

A dark-grey area at best.

• John Kerry Accused Of Violating Logan Act In Secret Iran Talks (ZH)

Though he previously denied it when allegations first surfaced last Spring, former Secretary of State John Kerry has now disclosed he’s personally had semi-frequent face to face contact with top Iranian officials to discuss US-Iran relations since Trump entered office. Kerry confirmed and explained in detail his recent meetings with Iranian Former Minister Javad Zarif in an interview with radio host Hugh Hewitt to promote his new memoir, Every Day Is Extra.

During the interview Kerry disclosed that he met with Zarif “three or four times” and discussed political issues and challenges between the United States and Iran in what could constitute a significant and clear violation of the Logan Act. Though it’s almost never been enforced, the 1799 Logan Act states that unauthorized diplomacy with foreign powers by private American citizens is a crime. Notably, two Trump-connected individuals that prominent Liberals and editorials demanded be prosecuted under the Logan Act include former national security advisor Michael Flynn and Trump senior adviser and son-in-law Jared Kushner.

When asked point blank during the radio show about his rumored meetings with top Iran officials, Kerry admitted, “I think I’ve seen him three or four times,” but attempted to claim he was not trying to “coach” Iran on how to navigate President Trump’s pullout of the Iran nuclear deal. Kerry is of course now a private citizen out of government but holds significant clout and influence with the Iran FM as the two hammered out the details of the JCPOA brokered under President Obama in the first place.

I wouldn’t be too sure Russia will back down again.

• US Destroyer Arrives In Mediterranean As Syria Tensions Rise (RT)

With the arrival of another guided missile destroyer to the Mediterranean, the US may have 200 ‘Tomahawks’ ready for a strike on Syria, as Russia warns that jihadist groups in Idlib are planning a fake chemical attack. The USS Bulkeley (DDG-84), an Arleigh Burke-class destroyer, entered the Mediterranean through the Straits of Gibraltar on Wednesday, the Russian news agency Interfax reported citing international maritime monitoring data. A Gibraltar-watcher confirmed the destroyer’s transit on September 12.

With the arrival of the Bulkeley, the US forces in the region have up to 200 ‘Tomahawk’ cruise missiles available to strike targets in Syria if ordered to do so, Interfax reported. Last week, the attack submarine USS Newport News (SSN-750) arrived in the Mediterranean as well. Last week, Russia conducted massive naval maneuvers off the Syrian coast, culminating in marine landing drills and missile launches. The presence of Russian ships in the area was seen as a possible deterrent to further US military action against Syria.

If a tree falls in a forest…

• No NGO Rescue Boats Currently In Central Mediterranean (G.)

Thousands of migrants risk dying at sea because of a clampdown on NGO rescue ships, aid agencies have warned, in what has been their longest period of absence from the central Mediterranean since they began operating in late 2015. Since 26 August, no NGO rescue vessel has operated on the main migration routes between north Africa and southern Europe. Anti-immigration policies by the Maltese and Italian governments, which have closed their ports to the vessels, have driven the sharp decrease in rescue missions. People seeking asylum are still attempting the risky crossing – but without the boats, shipwrecks are likely to rise dramatically.

The last time the Mediterranean was without NGO rescue boats was from 28 June to 8 July 2018, and in those days more than 300 migrants died at sea. The death toll has fallen in the past year, but the number of those drowning as a proportion of arrivals in Italy has risen sharply in the past few months, with the possibility of dying during the crossing now three times higher.

When we create truly lasting legacies.

• Two More Potential ‘Garbage Patch’ Zones In World’s Oceans Identified (Ind.)

Much attention has focus on the plastic floating on the surface, but this accounts for less than 1 per cent of the total plastic thought to be in ocean. To trace the likely fate of the remaining 99 per cent, scientists at Newcastle University used computer models and identified two likely locations for accumulation zones that had previously slipped under the radar. The Gulf of Guinea region and the East Siberian Sea may be hosting large quantities of plastic that cannot be easily viewed from the water surface, as up to 70 per cent of plastic debris is thought to sink and remain on the sea floor.

“There’s a need to find the unaccounted for plastic in the ocean mainly because if we don’t know the extent of the problem, then there’s no way of knowing the potential implications it has,” explained Alethea Mountford, a PhD Student at Newcastle University who led the study. “Once the plastics reach the water column, the greatest impact would be on marine organisms through ingestion and entanglement,” she said.

A lot of storms. Mangkhut is about to hit the Philippines.

• Florence To Slow Down, Hammer Carolinas and Appalachia for Days (Weather.com)

Hurricane Florence continues to expand in size. Hurricane-force winds now extend outward up to 80 miles the center and tropical-storm-force winds extend outward up to 195 miles from the center. This expansion in size only increases the hurricane’s energy and potential for significant storm surge. The National Hurricane Center noted Wednesday evening that while Florence has weakened some, “the wind field of the hurricane continues to grow in size. This evolution will produce storm surges similar to that of a more intense, but smaller, hurricane, and thus the storm surge values seen in the previous advisory are still valid.” Previous large Category 2 hurricanes have done enormous amounts of damage along the U.S. coast.

Sarah Kendzior tweets:

The best workaround I’ve found to Twitter’s horrible new algorithm is putting this in the search bar:

filter:follows -filter:replies include:nativeretweets

You will get your old chronological timeline back with no “likes” and with retweets from people you actually follow.

Debt Rattle September 10 2018

Sep 102018

September 10, 2018 Posted by Raúl Ilargi Meijer at 9:31 am Finance Tagged with: Assange, austerity, Brexit, Carter Page, chemical weapons, copyright, New Zealand, Ohr, rates, Syria, Trump, Tsipras 15 Responses »

Salvador Dali The Disintegration of the Persistence of Memory 1954

• Trump To Declassify Bruce Ohr, Carter Page Documents As Early As This Week (ZH)

• Stronger US Economy May Warrant ‘Restrictive’ Rates: Boston Fed’s Rosengren (R.)

• Brexit Will Fail Regardless Of Boris Johnson And Theresa May’s Jabs (Ind.)

• Battle Over EU Copyright Law Heads For Showdown (G.)

• US Senator: MI6 Planning Fake Chemical Weapons Attack On Syria (WaPo)

• What Caused The Crash Of 2008 Now Shapes Our Post-Modern 1930s (Varoufakis)

• Greek Bank Profits Are Hurt By Credit Contraction (K.)

• Greek PM Promises Relief Measures After Years Of Austerity (G.)

• Petition To Offer Assange Asylum To Be Presented To New Zealand Parliament (RT)

• US Lawyers Say They Have ‘Explosive’ Documents About Monsanto In Europe (EN)

• Turtles, Whales And Birds Under Threat From Brexit Funding Cuts (Ind.)

Nice way to start the week. I said this would happen, become a trend. Open thee, Sesame.

• Trump To Declassify Bruce Ohr, Carter Page Documents As Early As This Week (ZH)

President Trump is expected to declassify documents connected to the Obama administration’s surveillance of the Trump campaign during the 2016 US election, according to Axios, citing allies of the president who say it could happen as soon as this week. Specifically mentioned are documents concerning former Trump campaign adviser Carter Page, as well as the “investigative activities of Justice Department lawyer Bruce Ohr” – who was demoted twice for lying about his extensive relationship with Christopher Steele – the former MI6 spy who assembled the sham “Steele Dossier” used by the FBI in a FISA surveillance application to spy on Page.

Republicans on the House Intelligence and Judiciary committees believe the declassification will permanently taint the Trump-Russia investigation by showing the investigation was illegitimate to begin with. Trump has been hammering the same theme for months. • They allege that Bruce Ohr played an improper intermediary role between the Justice Department, British spy Christopher Steele and Fusion GPS – the opposition research firm that produced the Trump-Russia dossier, funded by Democrats. (Ohr’s wife, Nellie, worked for Fusion GPS on Russia-related matters during the presidential election – a fact that Ohr did not disclose on federal forms.) • And they further allege that the Obama administration improperly spied on Carter Page – all to take down Trump. -Axios

Ohr, meanwhile, met with Russian billionaire Oleg Deripaska in 2015 to discuss helping the FBI with organized crime investigations, according to The Hill’s John Solomon. The meeting with the Putin ally was facilitated by Steele. Three weeks ago, Trump called Ohr a disgrace, while also tweeting: “Will Bruce Ohr, whose family received big money for helping to create the phony, dirty and discredited Dossier, ever be fired from the Jeff Sessions “Justice” Department? A total joke!” According to emails turned over to Congressional investigators in August, Christopher Steele was much closer to Bruce Ohr and his wife Nellie than previously disclosed.

Steele and the Ohrs would have breakfast together on July 30, 2016 at the Mayflower Hotel in downtown Washington D.C., days after Steele turned in installments of his infamous “dossier” on July 19 and 26. The breakfast also occurred one day before the FBI formally launched operation “Crossfire Hurricane,” the agency’s counterintelligence operation into the Trump campaign. “Great to see you and Nellie this morning Bruce,” Steele wrote shortly following their breakfast meeting. “Let’s keep in touch on the substantive issues/s (sic). Glenn is happy to speak to you on this if it would help

To reiterate once again: not long after Lehman, Bernanke said the Fed had entered ‘uncharted territory’. They’re still there, groping in the dark. Not a clue, but faking it like pros.

• Stronger US Economy May Warrant ‘Restrictive’ Rates: Boston Fed’s Rosengren (R.)

When Boston Federal Reserve Bank President Eric Rosengren switched from advocating low interest rates to tighter monetary policy, he argued it was time to start crawling back toward “normal” rates even with 5% unemployment and weak growth and inflation. Two years later, Rosengren has joined colleagues in beginning to lay the groundwork for those rate hikes to potentially continue longer and to a higher level than currently expected as the outlook for the economy strengthens. Rates may not only need to become “restrictive,” but the definition of that may be moving up as well, Rosengren said in an interview with Reuters on Saturday following an economic conference here.

“This is not hair on fire. There is upward pressure on inflation, and given that we are already at 2%, labor markets are already tight … that is going to be a situation where we start persistently having inflation above what our target is,” Rosengren said. “There is an argument to normalize policy and probably be mildly restrictive.” The Fed maintains a 2% inflation target, which it is only now reaching after a decade struggling to consistently hit and maintain it. He said the Fed does not need to move faster than the current gradual pace, which has translated into roughly one rate hike per quarter, with the next expected later this month. That steady pace is a luxury gained by starting early, he said, skirting the need to move more quickly and catch up with a tightening economy.

Incompetent one and all.

• Brexit Will Fail Regardless Of Boris Johnson And Theresa May’s Jabs (Ind.)

When Boris Johnson decides to go on leadership manoeuvres he tends to be noisy. His latest line is that the prime minister is like some sort of incompetent suicide bomber, handing over the ignition button on her suicide vest to none other than Michel Barnier. Presumably, Mr Johnson would like us to believe that he would in fact willingly blow himself to kingdom come, shouting “Leave means Leave” on his way to enjoying the company of the promised 72 virgins of the Leave campaign. These may prove as mythical as the extra £350m a week for the NHS he once promised his own fanatical supporters. Or something like that.

As Mr Johnson has discovered, metaphors around Brexit can easily get misconstrued and extended way too far. With the suicide bomber analogy, Mr Johnson displayed his usual contempt for good taste and, as ever, took delight on winding up his opponents. These include two of his own former ministers at the Foreign Office, Alistair Burt and Sir Alan Duncan, who know his ways well and may be forgiven for letting off steam. Sir Alan called it disgusting. True, but it did the trick: Johnson is dominating the headlines again, just ahead of the Tory conference and crucial EU summits. It’s pretty obvious what he is up to.

On the substance though, there was little new in this intervention. Mr Johnson has, at least privately, let it be known that he regards the issue of the Irish border as a subsidiary one, unnecessarily getting in the way of his vision of Brexit. He apparently now regards the whole question as a plot by closet Remainers to keep the UK either in the EU or as close to the EU as makes no difference – Brexit in name only.

The EU can’t solve these issues by moving back to laws that cover traditional media. They need education, or this will fail spectacularly.

• Battle Over EU Copyright Law Heads For Showdown (G.)

Fought with hashtags, mailshots, open letters and celebrity endorsements, the battle over the European Union’s draft directive on copyright heads for a showdown this week. After two years of debate, members of the European parliament will vote on Wednesday on the legislation, which could change the balance of power between producers of music, news and film and the dominant websites that host their work. Proposed in 2016 to update copyright law for the age of Facebook and Google, the directive has unleashed a ferocious lobbying war. Lawmakers have been bombarded with millions of emails and thousands of calls, many based on standard scripts written by lobbyists. Some have even received death threats, according to the French MEP Virginie Rozière.

Critics claim the proposal will destroy the internet, spelling the end of sharing holiday snaps or memes on Facebook. Proponents are exasperated by such claims, described by German Christian Democrat Axel Voss as “totally wrong” and “fake news”. Amid last-minute writing and rewriting of amendments, the final outcome cannot be predicted. The proposals were rejected by the European parliament in July, despite earlier support in a relevant committee. Among the latest to mobilise in favour were 165 film-makers and screenwriters, including the British director Mike Leigh, who launched an appeal at the Venice film festival last week calling on EU lawmakers to pass the law. In July McCartney pressed MEPs to stop tech firms exploiting musicians.

Europe’s biggest news agencies have also urged MEPs to vote for the law, as they accused Google and Facebook of “plundering” the news and their ad revenues, resulting in a “threat to democracy”. “For the sake of Europe’s free press and democratic values, EU lawmakers should press ahead with copyright reform,” said a statement signed by 20 agencies, including the Press Association and Agence France-Presse. Opponents are no less forceful. Wikipedia shut down its pages in some countries in protest at the plans, which it claims would force the closure of its user-generated encyclopaedia. Berners-Lee is among 70 internet luminaries to oppose the law, arguing it would be transform the internet from an open platform into a tool for “automated surveillance and control”. The UN special rapporteur on freedom of expression, David Kaye, has raised concerns about “prepublication censorship”.

RT reports first US chemical attck in Syria over the weekend.

• US Senator: MI6 Planning Fake Chemical Weapons Attack On Syria (WaPo)

Fresh off a sitdown with Syrian president Bashar al-Assad, Virginia state senator Richard Black turned up on Arab TV last week making an extraordinary claim about one of the US’ closest allies. Mr Black said Britain’s MI6 intelligence service was planning a chemical weapons attack on the Syrian people, which it would then blame on Mr Assad. “Around four weeks ago, we knew that British intelligence was working towards a chemical attack in order to blame the Syrian government, to hold Syria responsible,” Mr Black said on Al Mayadeen, an Arab news channel based in Beirut. Mr Black said later that he meant the British were planning not to carry out an attack themselves, but to either direct rebels to do so or stage a phoney attack, with actors posing as victims.

Mr Black also said some chemical attacks previously reported to have occurred in Syria were British fakes, pulled off with help from volunteer first responders known as “White Helmets”. “From what I can tell, they have been planning a fake attack, not a genuine one, but one where they actually move people out of a town and they have trained people to portray victims of a gas attack,” Mr Black said in an interview with The Washington Post. “And the plan is to use the White Helmets who have always been involved in these notorious deceptions, to portray an attack.” The State Department flatly rejected Mr Black’s allegations, which echoed what it called “outrageous” Russian and Assad-regime claims that Britain and the US have carried out chemical attacks with help from the White Helmets.

Not sure looking backward is the way to go. Tempting because of choice details that seem to fit, but this is new.

• What Caused The Crash Of 2008 Now Shapes Our Post-Modern 1930s (Varoufakis)

In the autumn of 2008 events unfolded in Wall Street that the crushing majority of people around the world had been led to believe could never occur. It was the financial equivalent of watching the sun spinning out of control soon after it rose above the horizon. Humanity watched on in collective disbelief. The ancient Greeks had a term for moments like that one: aporia – a state of intense bafflement urgently demanding a new model of the world we live in. The Crash of 2008 was such a moment. Suddenly, the world ceased to make sense in terms of what, a few weeks before, passed as conventional wisdom.

Before long, the repercussions were felt everywhere. The certainties created by decades of of establishment thinking were gone, along with around $40 trillion of equity globally, $14 trillion of household wealth in the US alone, 700,000 US jobs every month, countless repossessed homes everywhere; the list is as long as the numbers it includes are unfathomable. Even McDonald’s, for goodness’ sake, could not secure an overdraft from Bank of America! The collective aporia intensified by the response of governments that had hitherto clinged tenaciously onto fiscal conservatism, as perhaps the 20th century’s last surviving ideology: the pouring of trillions of dollars, euros, yen etc. into a financial system which had been, until a few months before, on a huge roll, accumulating fabulous profits and provocatively professing to have found the pot of gold at the end of some globalised rainbow.

And when that response proved too feeble, our Presidents and Prime Ministers, men and women with impeccable anti-statist neoliberal credentials, embarked upon a spree of nationalising banks, insurance companies and automakers that put even Lenin’s 1917 exploits to shame. Ten years on, the crisis unleashed in Wall Street in 2008 is still with us. It takes different forms in different countries (i.e. a Great Depression in places like Greece, a scourge of middle class savers in countries like Germany, history’s greatest sponsor of brutal inequality in the United States, a permanent cause of geopolitical and trade tensions in Asia, Eastern Europe etc.). It migrates from continent to continent, from country to country. It morphs from an unemployment-generator to a deflation-machine, to another banking crisis, to a maximiser of trade and capital global imbalances.

Given their role in the whole crisis, why do these banks still exist?

• Greek Bank Profits Are Hurt By Credit Contraction (K.)

The return of Greek banks to profit becomes particularly fragile as long as the credit contraction persists. The reduction of loan issues, which has gone on for almost a decade, is depriving the credit system of its main source of revenues – takings from interests – while undermining efforts to improve the expenditure index that in the first half of the year deteriorated for local banks. Domestic lenders’ January-June financial results point to a fresh reduction in interest revenues, ranging from -1.5% to -22.5%, depending on the bank.

At the same time, revenues from commissions have increase by between 0.5% and 5.5% as banks have shifted their focus to increasing takings from commissions, especially after the imposition of capital controls in June 2015. However, the commissions are just a fraction of the interest revenues and cannot offset the losses from the main source of operating profits of banks. The biggest drop in interest revenues in the first half of the year belonged to National Bank (-22.5% to 564.4 million euros), which is attributed to the application of the new accounting standards (IFRS 9) in the first quarter and the repricing of mortgage loans amounting to 800 million euros. At the same time the NBG’s loan issues dropped 7.1% year-on-year.

Perfecting the art of faking it.

• Greek PM Promises Relief Measures After Years Of Austerity (G.)

Greek prime minister Alexis Tsipras has announced a raft of relief measures “to mend wounds” created during Greece’s prolonged economic crisis, as he attempts to recover the popularity he has lost since enforcing contentious austerity measures. In his first major policy address since debt-stricken Athens ended more than eight years of foreign tutelage under international bailout in August, the leftist leader pledged to raise wages, cut taxes and forge ahead with welfare spending. Far from backsliding on the fiscal progress the crisis-plagued country has made, the counter measures would help kickstart growth, Tsipras said, hailing a “new era of rebirth”.

“Higher wages, labour market regulation and respect for labour rights … are a prerequisite for growth,” he told delegates attending the Thessaloniki International Fair where annual economic policy goals are traditionally laid out. “The Greek economy is stabilised … we are a normal country now.” Tsipras said the tax cuts will include dramatically reducing a property levy for those worst affected by the crisis in 2019, and lowering sales VAT in 2021. Corporate tax, the bane of business development in the nation long on the frontline of the euro crisis, would be reduced from 29% to 25% by 2022. “It is the least we can do to mend wounds, reduce great burdens and create a growth dynamic in the Greek economy,” Tsipras said.

Other measures ranged from reinstating collective wage bargaining – a highly sensitive point among international creditors who have sought to trim the power of unions – and applying retroactive pay rises worth €1bn for university professors, the police, military and judiciary. [..] On Sunday, in his annual state of the nation press conference, Tsipras said because Greece was “outperforming all fiscal targets” his government would not only meet the new goals but argue that other cuts Athens has committed to were no longer necessary. At the behest of eurozone creditors the government has agreed to further scale back pensions in January 2019. “The economy is doing well,” Tsipras told reporters assembled in Thessaloniki. “I don’t know if you understand that, but the economy is doing well.”

By someone who doesn’t support it.

• Petition To Offer Assange Asylum To Be Presented To New Zealand Parliament (RT)

A petition with thousands of signatures supporting Julian Assange’s political asylum will be presented to New Zealand’s parliament. Labour Party politician Greg O’Connor said while he personally does not support Assange obtaining asylum in NZ, he will present the petition to parliament after more than 2,000 people signed their names in support of the WikiLeaks founder, reports Newstalk ZB. The parliamentary petition, launched in July 2018, will now be delivered to the Clerk of the house for allocation to a select committee for formal consideration. The ‘Free Assange NZ’ group said they haven’t forgotten the Australian’s plight and are following whistleblower Chelsea Manning on her tour of the country to remind people of the petition and its political progress. On Saturday night Assange supporters gathered outside the Embassy Theatre where Manning was speaking.

Let’s see them.

• US Lawyers Say They Have ‘Explosive’ Documents About Monsanto In Europe (EN)

US lawyers say they have “explosive” documents about crisis-hit agribusiness giant Monsanto and their affairs in Europe. Those involved in a successful lawsuit against the firm have been in Brussels, addressing a European Parliament special committee. Last month, Monsanto was ordered to pay 289 million dollars to a former school groundskeeper dying of cancer, after it was agreed the firm’s Roundup weedkilled contributed to his disease. “What we have is the tip of the iceberg. And in fact we have documents now in our possession, several hundreds documents, that have not been declassified and some of those are explosive,” said US lawyer Robert Jr. Kennedy.

“And many of them are pertinent to what Monsanto did here in Europe. And that’s just the beginning.” Beyond the environmental battle, what’s happened also raises the issue of transparency. For one Green MEP, the US legal battle is also one for democracy. “They are fighting a fight for more democracy and for transparency and to get a better insight in how big corporation such as Monsanto act and try to manipulate the facts,” said Belgium’s Bart Staes. Last November, the EU approved the use of glyphosate, a chemical used in Monsanto’s Roundup product, for five years after a heated debate over whether it causes cancer.

Britain has shrunk to a sixe too small to have overseas territories.

• Turtles, Whales And Birds Under Threat From Brexit Funding Cuts (Ind.)

Whales migrating across the Atlantic Ocean, turtles in the Caribbean and unique cloud forests in St Helena are all under threat as EU conservation projects are set to grind to a halt after Brexit. Following reports of the Falkland Islands’ penguins entering troubled waters as European funding dries up, conservationists working across Britain’s overseas territories have raised the alarm about the wider impact of this lost money. Due to their unusual status as neither fully parts of the UK nor independent states, these territories cannot access most domestic and international funding. This means EU money has offered a lifeline, and supports around a third of their conservation efforts.

There is currently no plan to make up for the shortfall that will emerge when existing projects finish. Stretching from the British Antarctic Territory to the Cayman Islands, the 14 UK overseas territories are home to hundreds of creatures found nowhere else on Earth. “There’s lots still unknown about the territories, they are quite a frontier,” said Jonathan Hall, who leads the RSPB’s overseas territories operations. “But they do hold at least 1,500 unique species – compared to the UK which has about 90.” These forgotten corners of the globe are home to more penguins than any other nation, a third of the world’s albatrosses and the largest coral atoll on the planet.

Many of the animals and plants found in these territories are critically endangered, and scientists estimate there are more than 2,000 species still awaiting discovery in their forests and lagoons. As the Brexit date looms, the government has promised to continue supporting ongoing projects in these regions, but beyond that local environmental groups are worried about how they will stay afloat. “It’s a huge concern,” said Charlie Butt, Caribbean territories programme manager at the RSPB. “The loss of a third of funding would be catastrophic from a conservation perspective.”

Debt Rattle August 29 2018

Aug 292018

August 29, 2018 Posted by Raúl Ilargi Meijer at 9:17 am Finance Tagged with: basic needs, Brazil, censorship, Facebook, Google, neonicotinoids, plastics, refugees, Syria, Trump, Twitter, Venezuela 8 Responses »

Pablo Picasso In “Le Lapin Agile” or harlequin with a glass 1905

• Almost Half Of Americans Can’t Pay For Their Basic Needs (CBS)

• White House Probes Google After Trump Accuses It Of Bias (R.)

• Trump Unblocks More Twitter Users After US Court Ruling (R.)

• Facebook Censorship, Mad Ben Nimmo and the Atlantic Council (Craig Murray)

• The Greatest Fake Bull Ever (Stockman)

• China’s Building-Boom Hits A Wall As Shadow-Banking System Collapses (ZH)

• A Senator Masquerading as a Gas Station (Dmitry Orlov)

• Brazil Sends Army To Border As Venezuelans Flee Crisis At Home (R.)

• Syria Ready To Take One Million Returning Refugees – Moscow (AFP)

• Just 10 Rivers Carry 95% Of All Plastic Into The Ocean (BT)

• Bees Develop Preference For Pesticides (PA)

Now imagine a shrinking economy thrown in.

• Almost Half Of Americans Can’t Pay For Their Basic Needs (CBS)

Four in 10 Americans are struggling to pay for their basic needs such as groceries or housing, a problem even middle-class households confront, according to a new study from the Urban Institute. Despite the U.S. economy being near full employment, 39.4 percent of adults between 18 and 64 years old said they experienced at least one type of material hardship in 2017, according to the study, which surveyed more than 7,500 adults about whether they had trouble paying for housing, utilities, food or health care. The findings surprised researchers at the Urban Institute, who had expected to find high levels of hardship among poor Americans but hadn’t predicted so many middle-class families would also struggle to meet their basic needs.

That may illustrate that a middle-class income “is no guarantee” of protection from hardship, said Michael Karpman, research associate at the Urban Institute’s health Policy Center and a co-author of the report. Against the backdrop of President Donald Trump’s boasting about low unemployment and strong economic growth, the research adds nuance to the problems facing American families. Middle-class households tend to struggle with paying their health care bills rather than utilities, for instance. Health care costs have outpaced wages and inflation, pushing more Americans into high-deductible plans, which can backfire when serious health problems arise.

“A lot of people are looking at the fact that wages aren’t keeping up with household costs as one reason families are having difficulty making ends meet,” Karpman said. “Even for families with health insurance, they may be facing high deductibles that leave them facing high costs.”

The bias is obvious. How to fight it is not.

• White House Probes Google After Trump Accuses It Of Bias (R.)

U.S. President Donald Trump on Tuesday accused Google’s search engine of promoting negative news articles and hiding “fair media” coverage of him, vowing to address the situation without providing evidence or giving details of action he might take. Trump’s attack against the Alphabet Inc unit follows a string of grievances against technology companies, including social media Twitter Inc and Facebook Inc, which he has accused of silencing conservative voices, and Amazon.com Inc, which he has said is hurting small businesses and benefiting from a favorable deal with the U.S. Postal Services. He frequently berates news outlets for what he perceives as unfair coverage.

Google denied any political bias, saying in a statement that its search engine is “not used to set a political agenda and we don’t bias our results toward any political ideology.” Trump said in several tweets on Tuesday that Google search results for “Trump News” were “rigged” against him because they showed only coverage from outlets like CNN and not conservative publications, suggesting the practice was illegal. “I think Google is really taking advantage of our people,” Trump said on Tuesday in the Oval Office. “Google, and Twitter and Facebook, they are really treading on very, very troubled territory, and they have to be careful. It’s not fair to large portions of the population.”

A pattern emerges. Trump violates 1st amendment when blocking users, but Twitter “retains authority to revoke access”. That cannot stand.

• Trump Unblocks More Twitter Users After US Court Ruling (R.)

U.S. President Donald Trump on Tuesday unblocked some additional Twitter users after a federal judge in May said preventing people from following him violated individuals constitutional rights. U.S. District Judge Naomi Reice Buchwald in Manhattan ruled on May 23 that comments on the president’s account, and those of other government officials, were public forums and that blocking Twitter Inc users for their views violated their right to free speech under the First Amendment of the U.S. Constitution. The Knight First Amendment Institute at Columbia University on August 10 sent the Justice Department a list of 41 accounts that had remained blocked from Trump’s @RealDonaldTrump account. The seven users who filed suit had their accounts unblocked in June.

The 41 blocked users include a film producer, screenwriter, photographer and author who had criticized President Trump or his policies. At least 20 of those individuals said on Twitter that Trump had unblocked them on Tuesday. The 41 users were not a comprehensive list of those blocked by Trump. Rosie O’Donnell, a comedian, said on Twitter late Tuesday that she remained blocked. [..] The ruling has raised novel legal issues. The Internet Association, a trade group that represents Twitter, Facebook Inc, Amazon.com, and Alphabet Inc, filed a brief in the case earlier this month that did not back Trump or the blocked users but urged the court to “limit its decision to the unique facts of this case so that its decision does not reach further than necessary or unintentionally disrupt the modern, innovative Internet.”

[..] The Internet Association said the court “should make clear that this case does not implicate the overwhelming majority of social media accounts throughout the Internet.” “Despite any First Amendment status that this court might find in the ‘interactive spaces’ associated with President Trump’s account, Twitter retains authority to revoke access to both his account and the account of any user seeking to comment on President Trump’s account,” the group said.

Facebook deletes posts from a former UK ambassador.

• Facebook Censorship, Mad Ben Nimmo and the Atlantic Council (Craig Murray)

Facebook has deleted all of my posts from July 2017 to last week because I am, apparently, a Russian Bot. For a while I could not add any new posts either, but we recently found a way around that, at least for now. To those of you tempted to say “So what?”, I would point out that over two thirds of visitors to my website arrive via my posting of the articles to Facebook and Twitter. Social media outlets like this blog, which offer an alternative to MSM propaganda, are hugely at the mercy of these corporate gatekeepers.

Facebook’s plunge into censorship is completely open and admitted, as is the fact it is operated for Facebook by the Atlantic Council – the extreme neo-con group part funded by NATO and whose board includes serial war criminal Henry Kissinger, Former CIA Heads Michael Hayden and Michael Morrell, and George Bush’s chief of Homeland Security Michael Chertoff, among a whole list of horrors.

The staff are worse than the Board. Their lead expert on Russian bot detection is an obsessed nutter named Ben Nimmo, whose fragile grip on reality has been completely broken by his elevation to be the internet’s Witchfinder-General. Nimmo, grandly titled “Senior Fellow for Information Defense at the Atlantic Council’s Digital Forensic Research Lab”, is the go-to man for Establishment rubbishing of citizen journalists, and as with Joseph McCarthy or Matthew Clarke, one day society will sufficiently recover its balance for it to be generally acknowledged that this kind of witch-hunt nonsense was not just an aberration, but a manifestation of the evil it claimed to fight.

“..the generational fiscal catastrophe that looms in the 2020s as 80 million baby-boomers pile onto the social security/medicare wagon.”

• The Greatest Fake Bull Ever (Stockman)

the Wall Street stock indices have vastly out-run the meager gains in the main street economy since the pre-crisis peak; and that at this late stage of the business cycle—merely 10 months from the prior record—there is absolutely no plausible risk/reward equation left. That’s because earnings will plummet in the next recession—by 40% or more if history is any guide. And that’s likely to be conservative in view of the elephant in the casino that Wall Street stubbornly refuses to acknowledge. To wit, back in June 2007, the S&P 500 earnings peaked at $85 per share, but that reflected fully $55 per share of after-tax interest expense. Fast forward to the LTM period ending in December 2017 when earnings per share posted at $110 per share, but reflected only $19 per share of after-tax interest expense.

In other words, more than 100% of the gain over the past 11 years was due to the drastic financial repression of the central banks and its impact on corporate interest expense. Yet the central banks of the world—led belatedly by the Fed—have made an epochal pivot to QT (quantitative tightening) and interest rate normalization, even as the value of the interest expense deduction has been reduced to chump change owing to the new effective tax rate of about 15%. So interest expense is marching back up the hill, and it’s not remotely priced-in—not any more than the next recession or the generational fiscal catastrophe that looms in the 2020s as 80 million baby-boomers pile onto the social security/medicare wagon.

Xi has let the shadows grow to fake the growth, and will have a hard time tackling them now.

• China’s Building-Boom Hits A Wall As Shadow-Banking System Collapses (ZH)

Beijing wants to shore up growth without inundating the economy with cheap credit. But, as WSJ’s Walter Russell Mead pointed out previously, it’s not easy… “Chinese leaders know that their country suffers from massive over-investment in construction and manufacturing, that its real-estate market is a bubble that makes the Dutch tulip frenzy look restrained, that both conventional debt and debt in the shadow-banking system are too large and growing too rapidly. But even as the Communist Party centralizes power and clamps down on dissent, it dithers when it comes to the costly and difficult work of shifting China’s economic development onto a sustainable track. Chinese authorities have tried to tackle some of these problems, but often retreat when reforms start to bite and powerful interests push back.”

To see how hard that will be, The Wall Street Journal’s Nathaniel Taplin takes a look at China’s roads and railways. “China is the 800-pound gorilla of global infrastructure. Its building prowess has permeated popular culture, as in the disaster movie “2012” where China constructs giant ships to help humankind escape rising seas. Recently, however, China’s infrastructure build has all but ground to a halt.” Here’s why… The central government last year started to crack down on unregulated, opaque – so-called ‘shadow-bank’ borrowing – alarmed at its vast scale, and potential for corruption.

For five straight months, the shadow banking system has contracted under this pressure, sucking the malinvestment lifeblood out of economic growth and construction booms as Chinese local governments, which account for the bulk of such investment, set up as so-called local-government financing vehicles (off balance sheet), or LGFVs, and have seen an unprecedented net $19 billion outflow in recent months. As WSJ’s Talpin notes, these days Beijing prefers that local governments borrow on-the-books, through the now legal municipal bond market. The problem is that lower-rated and smaller cities are mostly shut out, even though they do most actual capital spending. As a result, investment has kept slowing even though China’s net muni bond issuance in July was three times higher than it was in March.

“Other Americans just marched around ineffectually, waving banners and shouting antiwar slogans, but not McCain!”

• A Senator Masquerading as a Gas Station (Dmitry Orlov)

John McCain is dead, and many people are celebrating whereas they should be sad. He wasn’t a friend of mankind—he was its enemy, but a really bad one. But with such grossly incompetent enemies—who needs friends? McCain did a great deal to destroy America. He devoted his entire lifetime to American destruction. To start with, he was quite effective as a protester against America’s genocidal war on the people of Vietnam. Other Americans just marched around ineffectually, waving banners and shouting antiwar slogans, but not McCain! His own father had a lot to do with starting that war, but McCain made up for that by destroying 26 American war planes. That’s quite something! If every American flyer crashed as many planes, countless innocent lives would have been saved.

Of course, he could have done even better—and he did try. He almost managed to destroy the US aircraft carrier Forrestal by setting it ablaze. To top off his illustrious military career, he surrendered to the enemy and spent five years in a Vietnamese prison. This made him a hero—in Americans’ eyes only, while the rest of the world saw in him a murderer of Vietnamese children. His “martyrdom” as a POW helped pave his way to a political career, first in Congress, then in the Senate. During his obscenely long career in national politics, McCain did what he could to make American “democracy” look like a complete joke and to hasten America’s collapse. This, by the way, wasn’t a tall order: American “democracy” had long been a cesspool—a playground for lobbyists and political technologists based on a fully gerrymandered system of fake elections. But he did his thing, and is therefore twice the hero.

Fast getting out of hand.

• Brazil Sends Army To Border As Venezuelans Flee Crisis At Home (R.)

Brazil said it was sending armed forces to keep order near the Venezuelan border area, while Peru declared a health emergency, as a regional crisis sparked by thousands of Venezuelans fleeing economic collapse escalated on Tuesday. In Brazil, where residents rioted and attacked Venezuelan immigrants in a border town earlier this month, President Michel Temer signed a decree to deploy the armed forces to the border state of Roraima. He said the move was aimed at keeping order and ensuring the safety of immigrants. Peru, meanwhile, declared a 60-day health emergency in two provinces on its northern border, citing “imminent danger” to health and sanitation.

The decree, published in the government’s official gazette, did not give more details on the risks, but health authorities have previously expressed concerns about the spread of diseases such as measles and malaria from migrants. The exodus of Venezuelans to other South American countries is building toward a “crisis moment” comparable to events involving refugees in the Mediterranean, the United Nations said this week. Temer blamed the socialist Venezuelan government of President Nicolas Maduro for the migration crisis. “The problem of Venezuela is no longer one of internal politics. It is a threat to the harmony of the whole continent,” Temer said in a televised address.

If the US lets Syria rebuild.

• Syria Ready To Take One Million Returning Refugees – Moscow (AFP)

Russia’s defence minister said on Tuesday that war-torn Syria would be ready to accept one million returning refugees, following Moscow-backed reconstruction work. “Since 2015, when towns and villages gradually started to be freed, more than one million people have returned home,” Sergei Shoigu said in comments reported by Russian news agencies. “Now every opportunity has been created for the return of roughly one million (more) refugees,” he told journalists. “Huge infrastructure reconstruction work is ongoing, the rebuilding of transport routes and security points so that Syria can begin accepting refugees.”

Russia, a long-time ally of Syria, launched a military intervention in 2015 to support the embattled regime of President Bashar al-Assad, a move that changed the course of the war. Assad and his allies have since recovered swathes of territory and the government is turning its attention to post-conflict reconstruction, with the aid of Moscow. The war that erupted in 2011, one of the most devastating conflicts since World War II, has displaced more than half of Syria’s population, including more than five million beyond its borders. Most of them fled to neighbouring countries, particularly Turkey, Jordan and Lebanon.

It’ll take a gargantuan effort to stop this.

• Just 10 Rivers Carry 95% Of All Plastic Into The Ocean (BT)

Cheap, durable and multifunctional, plastic is one of humanity’s most successful inventions. From the 1950s to 2015, we’ve produced 8.3 billion metric tons of the stuff. By now, it’s everywhere. It’s also non-biodegradable. And that’s devastating the environment. Only 9% of all plastic waste has been recycled, and another 12% has been incinerated. That means that almost 80%—nearly 6.3 billion tons—has turned into waste with no half-life to speak of: condemned to an eternity as landfill, litter or ocean-clogging junk. Every year, plastic kills around 1 million seabirds, 100,000 sea mammals and inestimable numbers of fish. The volume of plastic trash in the world’s oceans is currently estimated to be around 150 million tons. No less than eight million tons are added to that every year—that’s one truckload every minute.

Between 0.5 and 2.75 million tons come from rivers alone. Large rivers are particularly efficient conveyors of plastic waste to the oceans, especially in countries lacking a well-developed waste management infrastructure. Up to 95% of river-borne plastic comes from just 10 rivers, scientists at the Helmholtz Center for Environmental Research in Leipzig, Germany have found. The scientists analysed data on both microplastic debris (<5mm) such as beads and fibres, as well as microplastic objects (plastic bottles, bags, etc.) from 79 sampling sites on 57 of the world’s largest rivers, singling out the 10 mapped out here as the biggest culprits, due to “mismanagement of plastic waste in their watersheds”.

Nicotine addiction.

• Bees Develop Preference For Pesticides (PA)

Bumblebees acquire a taste for pesticide-laced food that can be compared to nicotine addiction in smokers, say scientists. The more of the nicotine-like chemicals they consume, the more they appear to want, a study has shown. The findings suggest that the risk of potentially harmful pesticide-contaminated nectar entering bee colonies is higher than was previously thought. In a series of studies, a team of British researchers offered bumblebees a choice of two sugar solutions, one of which was laced with neonicotinoid pesticides. They found that over time the bees increasingly preferred feeders containing the pesticide-flavoured sugar.

Dr Richard Gill, from the Department of Life Sciences at Imperial College London, said: “Given a choice, naive bees appear to avoid neonicotinoid-treated food. However, as individual bees increasingly experience the treated food they develop a preference for it. “Interestingly, neonicotinoids target nerve receptors in insects that are similar to receptors targeted by nicotine in mammals. “Our findings that bumblebees acquire a taste for neonicotinoids ticks certain symptoms of addictive behaviour, which is intriguing given the addictive properties of nicotine on humans, although more research is needed to determine this in bees.” Controversial neonicotinoid pesticides are chemically similar to nicotine, the addictive compound in tobacco.

Debt Rattle August 21 2018

Aug 212018

August 21, 2018 Posted by Raúl Ilargi Meijer at 8:38 am Finance Tagged with: Ardern, Brexit, debt, Facebook, Fed, Lavrov, Mueller, NHS, Salvini, sanctions, Syria, Trump, Twitter 10 Responses »

Henri Matisse The painter and his model 1916-17

• China’s Biggest Risk May Be Its Property Market – Not The Trade War (CNBC)

• Why Do American CEOs Get Paid So Much? (Galbraith)

• Trump Says It Is ‘Dangerous’ For Twitter, Facebook To Ban Accounts (R.)

• Trump Worries That Mueller Interview Could Be A ‘Perjury Trap’ (R.)

• Trump Demands Fed Help On Economy, Complains About Interest Rate Rises (R.)

• UK’s Hunt To Call On Trump To Impose Fresh Sanctions On Russia (G.)

• ‘Secret Directive’ Bans UN Agencies From Helping Rebuild Syria – Lavrov (RT)

• UK Household Debt Balloons To £19bn As Bailiff Problems Multiply (Ind.)

• NHS Leak Warns Of Brexit Drug Shortages And Disease Risk (G.)

• Jacinda Ardern Freezes New Zealand MPs’ Pay To Tackle Rich-Poor Divide (G.)

• Salvini Refuses To Let In Refugees After Coastguard Ship Docks (G.)

• What Being Back in the Markets Actually Means for Greece (TPP)

• The Winners Will Lose and the Losers Will Win (Kunstler)

• The Inescapable Weight Of My $100,000 Student Debt (G.)

“Real estate investment accounts for about two-thirds of Chinese household assets..”

• China’s Biggest Risk May Be Its Property Market – Not The Trade War (CNBC)

China’s hot real estate market remains a challenge for authorities trying to maintain stable economic growth in the face of trade tensions with the U.S. In fact, property is the country’s biggest risk in the next 12 months, much greater than the trade war, according to Larry Hu, head of greater China economics at Macquarie. He said he is especially watching whether the real estate market in lower-tier, or smaller, cities will see a downturn in prices or housing starts after recent sharp increases. Real estate investment accounts for about two-thirds of Chinese household assets, according to wealth manager Noah Holdings. The property market also plays a significant role in local government revenues, bank loans and corporate investment.

As a result, a sharp slowdown in the real estate market’s growth and drop in prices would have a negative affect on overall economic growth. So far, the market has been hot: The average selling price for newly built non-governmental housing in 60 tier-three and tier-four cities tracked by Tospur Real Estate Consulting rose 28.1 percent from January 2016 to May 2018. [..] Last week, Nanjing, a tier-two city, announced a ban on corporate purchases of residential properties, following similar moves to limit speculation by Shanghai and some other cities. That’s a good move for controlling risk, according to Joe Zhou, real estate and investment management firm JLL’s regional director for China capital markets. He said the government is not likely to loosen its policy soon and that prices could decline on average.

“The reliance of tech firms on venture capital and bubble psychology, rather than cash flow..”

• Why Do American CEOs Get Paid So Much? (Galbraith)

A new report from the Economic Policy Institute calls attention to the hardy perennial of how much America’s corporate titans make: bosses of the top 350 firms made an average of $18.9m in 2017. That’s a ratio of 312-1 over the median worker in their industries. Big bucks to be sure. And a big change since 1965, when the ratio was just 20-1. But what does it mean? And if there’s a problem, what is it, exactly? What it means, as the EPI economists carefully document, is that the top US corporate chiefs are paid overwhelmingly with stock options, and their income fluctuates with the market. About 80% of the pay packet is in stocks, and the rise of 17% in 2017 after two flat years surely suggests that the top CEOs (not unreasonably) sensed the market peaked last year.

So they cashed in. On the other 20% of the pay packets, no gains occurred. The US numbers have shock value. But bear in mind that they reflect not only the way companies are run, but also changes over decades in the structure of the US economy and tax law, specifically the rise of market valuations in technology and finance at the expense of the major industrial corporations, and a corresponding decline in unions, which held down the ratios in the sectors the industrial firms dominated a half century back. Plus, there is the radical decline in top marginal tax rates on income and capital gains, beginning in 1978, which gave executives strong reasons to restructure their pay away from inside-the-corporation perks (the penthouses and country clubs of yore) and toward cash and capital assets.

The reliance of tech firms on venture capital and bubble psychology, rather than cash flow, deepened this trend. Note also that there is something a bit artificial about the resulting “wealth.” Jeff Bezos may have a net worth of over $150bn, mostly in Amazon stock, but he couldn’t convert it into cash if he wanted to, neither by selling nor by borrowing. Any effort to sell would demolish Amazon’s valuation and hence his own fortune. The rich aren’t like us – they have more money, true, but some of it isn’t really money and it can disappear, by the billions, pretty fast.

As I wrote yesterday, this will have to change.

• Trump Says It Is ‘Dangerous’ For Twitter, Facebook To Ban Accounts (R.)

U.S. President Donald Trump said on Monday that it is “very dangerous” for social media companies like Twitter and Facebook to silence voices on their services. Trump’s comments in an interview with Reuters come as the social media industry faces mounting scrutiny from Congress to police foreign propaganda. Trump has made his Twitter account – with more than 53 million followers – an integral and controversial part of his presidency, using it to promote his agenda, announce policy and attack critics. Trump previously criticized the social media industry on Aug. 18, claiming without evidence in a series of tweets that unnamed companies were “totally discriminating against Republican/Conservative voices.”

In the same post, Trump said “too many voices are being destroyed, some good & some bad.” Those tweets followed actions taken by Apple, Alphabet, YouTube and Facebook to remove some content posted by Infowars, a website run by conspiracy theorist Alex Jones. Jones’ own Twitter account was temporarily suspended on Aug. 15. “I won’t mention names but when they take certain people off of Twitter or Facebook and they’re making that decision, that is really a dangerous thing because that could be you tomorrow,” said Trump.

Also mentioned yesterday. Chances of a sitdown in the next 10 days don’t look good.

• Trump Worries That Mueller Interview Could Be A ‘Perjury Trap’ (R.)

U.S. President Donald Trump said on Monday he was worried that any statements under oath he provides to Special Counsel Robert Mueller could be used to bring perjury charges against him as part of the probe into Russia’s electoral interference. In an interview with Reuters, Trump echoed the concerns of his top lawyer in the probe, Rudy Giuliani, who has warned that any sit-down with Mueller could be a “perjury trap.” The president expressed fears that investigators could compare his statements with that of others who have testified in the probe, such as former FBI Director James Comey, and that any discrepancies could be used against him.

“So if I say something and he (Comey) says something, and it’s my word against his, and he’s best friends with Mueller, so Mueller might say: ‘Well, I believe Comey,’ and even if I’m telling the truth, that makes me a liar. That’s no good.” Despite his concerns, Trump did not comment on whether he would ultimately agree to an interview with Mueller, who is, among other things, investigating whether Trump’s campaign team colluded with Russians during the 2016 election and whether Trump has obstructed justice in the probe. Trump also declined to say whether he might strip Mueller of his security clearance, as he did last week to former CIA Director John Brennan, who had repeatedly criticized Trump’s handling of foreign policy and national security issues.

“I haven’t given it a lot of thought,” he said. [..] Trump asserted that he retained the power to intervene in the probe, but that he had chosen not to do so for the moment. His administration, Trump said, was “a smooth-running machine, except in that world. And I’ve decided to stay out. Now I don’t have to stay out. “I can go in, and I could do whatever — I could run it if I want. But I decided to stay out,” he said. “I’m totally allowed to be involved if I wanted to be. So far, I haven’t chosen to be involved. I’ll stay out.”

Whatever the predictable comments on this, what he really does is confirm the Fed’s independence.

• Trump Demands Fed Help On Economy, Complains About Interest Rate Rises (R.)

U.S. President Donald Trump said on Monday he was “not thrilled” with the Federal Reserve under his own appointee, Chairman Jerome Powell, for raising interest rates and said the U.S. central bank should do more to help him to boost the economy. In the middle of international trade disputes, Trump in an interview with Reuters also accused China and Europe of manipulating their respective currencies. American presidents have rarely criticized the Fed in recent decades because its independence has been seen as important for economic stability.

Trump has departed from this past practice and said he would not shy from future criticism should the Fed keep lifting rates. The president spooked investors in July when he criticized the U.S. central bank’s over tightening monetary policy. On Monday he said the Fed should be more accommodating on interest rates. “I’m not thrilled with his raising of interest rates, no. I’m not thrilled,” Trump said, referring to Powell.

Nobody Hunt goes to Washington with veiled criticism of Trump. Good luck with that.

• UK’s Hunt To Call On Trump To Impose Fresh Sanctions On Russia (G.)

The British foreign secretary, Jeremy Hunt, is to urge Donald Trump to face down Moscow’s threat to western values by imposing wider economic sanctions against Russia and agreeing new rules to protect the legitimacy of democratic elections. In a speech in Washington on Tuesday during his first visit since taking over from Boris Johnson as the UK’s most senior diplomat, Hunt will specifically call for tighter regulation of online political advertising and new measures to prevent cyber attacks on electoral machinery. Hunt will also throw out a challenge to Trump’s protectionist policies by warning a weakening of free trade will only damage western economies, and ultimately western political power.

He will say the emergence of an international order based on the application of law rather than might had led to an exponential growth in trade, leading to extraordinary advances in economic and social prosperity across the globe. He will also call for Nato to set clearer red lines about Russia’s use of chemical weapons and incursions into foreign territory such as the annexation of Crimea in 2014. Without directly challenging the legitimacy of Trump’s election as president in 2016, he will point to the drawbacks in many recent democratic outcomes, saying: “The heart of any democracy is freedom of expression, which allows citizens to access independent information to help decide who to vote for. But the ubiquity of fake news, social media targeting and foreign attempts to manipulate elections have undermined confidence that this can actually happen.”

Any tarnishing of Trump’s electoral mandate is highly perilous territory for a foreign politician, and Hunt will temper his criticism by saying western leaders should not deceive themselves that populism is merely a byproduct of social media spreading fake news.

Rebuilding Syria can solve a large part of Europe’s refugee problem, and US and UN are holding it back?

• ‘Secret Directive’ Bans UN Agencies From Helping Rebuild Syria – Lavrov (RT)

Washington’s “absolutely deconstructive” stance is hampering the rebuilding of Syria and constricts the UN in aiding the country until a so called ‘political transition’ takes place, Sergey Lavrov, Russia’s Foreign Minister, said.
“We addressed UNESCO on how they plan to implement the longtime talks, the longtime understanding on attracting the potential of this organization to rebuilding Palmyra,” an ancient city, regarded by the agency as a World Heritage Site, Lavrov said. “From the explanations of why UNESCO has still been unable to get involved in this process actively, we took that there was some kind of a directive from the United Nations headquarters in New York.”

He said that the UN Secretariat, which is the organizations’ executive arms, has “actually issued and distributed a secret directive throughout the UN system in October last year that prohibited the agencies included in this system from participating in any kind of projects aimed at restoring the Syrian economy.” Only humanitarian aid and nothing more” was allowed, the minister told the journalists after talks with Lebanese counterpart, Gebran Bassil, in Moscow. “A term was put forward that restoration of Syria would only be on the agenda after a certain progress is made in the so-called political transition” in the country, he added. The Russian Foreign Ministry also said that due to the “absolutely deconstructive” stance of the US one also shouldn’t expect any positive decisions on rebuilding Syria and return of refugees to the country from the UN Security Council.

“People can face having their essential services cut off, be kicked out of their home due to rent arrears or even face prison if they get behind on their council tax..”

A country moving backwards.

• UK Household Debt Balloons To £19bn As Bailiff Problems Multiply (Ind.)

UK households have fallen behind on essential bills such as council tax and electricity by as much as £18.9bn, according to Citizens Advice, which says it helps someone with bailiff-related problems every three minutes. The total outstanding debt includes almost £7.5bn in tax credit overpayments, £2.84bn owed in council tax and £2.2bn owed to water companies. Household debt has now overtaken consumer credit as the main money problem people contact Citizens Advice about, and the charity said that falling behind on household bills “has more severe consequences than missing consumer credit repayments”, such as overdrafts and personal loans.

“People can face having their essential services cut off, be kicked out of their home due to rent arrears or even face prison if they get behind on their council tax,” Citizens Advice warned. The charity said it had seen a 24 per cent increase in bailiff problems since the government introduced reforms in 2014 that were meant to protect people from unfair bailiff practices. Under the reforms, bailiffs are no longer allowed to make late-night visits to collect debts, and are prevented from using force against people who owe money, amongst other rules.

Since there is no progress on many essential Brexit elements, this is not some doom fantasy.

• NHS Leak Warns Of Brexit Drug Shortages And Disease Risk (G.)

Hospitals face running out of drugs in a chaotic no-deal Brexit, the group that represents NHS hospital and ambulance service has privately warned. Poor co-ordination by ministers and health service bosses means there has been a failure to prepare for the UK to be left without a Brexit deal, a leaked letter from NHS Providers said. “Public health and disease control co-ordination could suffer,” said NHS Providers chief executive Chris Hopson, setting out how a hard Brexit or no deal could negatively effect “the entire supply chain of pharmaceuticals” and “jeopardise” the EU citizens making up the “workforce on which the NHS relies”. Hopson’s letter, sent to NHS England chief executive Simon Stevens and NHS Improvement chief Ian Dalton on Friday, was leaked to the Times.

Hopson said the possibility of a no-deal or hard Brexit “with minimal regulatory alignment appears to be growing … For as long as that risk remains it is important that detailed operation planning is undertaken across the NHS. “Yet trusts tell us that their work in this area is being hampered by the lack of visible and appropriate communication. “Our members have begun planning … but they have hit a problem, in that some activities are clearly best done at a national level and, in the view of trusts, are best co-ordinated by NHS England and NHS Improvement. “However there has been no formal communication to trusts from either of your organisations on this issue.”

Always risky to cut your immediate colleagues, but makes a ton of sense.

• Jacinda Ardern Freezes New Zealand MPs’ Pay To Tackle Rich-Poor Divide (G.)

Jacinda Ardern has frozen the salaries of New Zealand’s MPs, saying the pay rises were out of step with the wider workforce and were adding to the rich-poor divide. The radical move has cross-party support from Ardern’s coalition partners, as well as the opposition National party. MPs’ salaries and allowances would be frozen till July 2019, Ardern said, while “a fairer formula for future pay increases” is developed for those in politics, who earn between NZ$163,000 ($108,000) to more than NZ$450,000 ($300,000). Ardern said the freeze was “the right thing to do” and was not about cost-cutting, but making New Zealand a more equitable nation.

The PM was prompted to take action after the Remuneration Authority recommended MPs receive a 3% pay rise, in a year that is seeing widespread strike action by teachers, nurses and other workers across New Zealand. Ardern earns more than NZ$450,000 a year, making her the fifth-highest paid leader in the OECD, and better paid than Canada’s Justin Trudeau and the UK’s Theresa May. According to a survey by Stuff, 62% of New Zealanders think the country’s prime ministers are paid too much. Australian prime minister Malcolm Turnbull earns the largest salary of any leader in the OECD. “It’s about whether or not it’s right that we receive a 3% pay increase that continues to extend that gap between those on the highest incomes and those on lower and more modest incomes,” Ardern told Radio NZ today.

The EU MUST come up with a plan.

• Salvini Refuses To Let In Refugees After Coastguard Ship Docks (G.)

An Italian coastguard ship with 177 people on board has docked in the Sicilian seaport of Catania, but Italy’s far-right interior minister Matteo Salvini has not given authorisation for the refugees and migrants to disembark. The passengers, who have been stuck on the coastguard boat Ubaldo Diciotti for five days will not be allowed on land until “Europe steps in to help’’, Salvini said. The Diciotti picked up 190 refugees and migrants last Wednesday from an overcrowded boat about 17 sea miles from the island of Lampedusa. Thirteen of them were evacuated for emergency medical treatment. Since then, Rome has insisted that Malta should take the group because their boat first passed through its search-and-rescue area.

But Malta has refused, claiming that the migrants wanted to reach Italy. Questioned by the Italian authorities, the 13 evacuated migrants claimed that the Maltese had escorted them outside its search-and-rescue zone. On Monday afternoon, after three days of negotiations, Italy’s transport minister Danilo Toninelli announced finally on Twitter that “The Diciotti ship will dock in Catania.” But shortly afterwards, sources close to Salvini said he had not given the authorisation to disembark, suggesting the boat was granted permission to dock but the migrants will have to remain on board. Salvini said on Italian TV: “The ship may land in Italy, as long as the 177 migrants are distributed, in a spirit of solidarity by the EU.”

What does it mean? More debt.

• What Being Back in the Markets Actually Means for Greece (TPP)

The devil, as they say in English, lies in the details. Being ‘back in the markets’, ‘turning a page,’ even declaring ‘the end of the Greek Crisis’ have all become commonplace expressions over the past few weeks. But what does this substantively mean? It means that an economy that has shrunk by around 25% saw, due to that shrinkage, its debts go up by about the same amount, despite near 100 billion Euro in debt being wiped off in 2012. Current outstanding Greek debt stands at 343 billion Euro. It now needs to pay a large chunk of that back to get back to where it was in 2008, with 109% debt to GDP.

The years of the Greek crisis (2010-2018) were the years that former finance minister Yanis Varoufakis famously described as the years of ‘extend and pretend.’ The EU would extend more credit (debt) to Greece that Greece would pretend to pay back. While most of the bailout cash prior to 2013 went through Greece back to Northern Banks, after 2013 most of the Debt was held by an opaqueprivate financial institution housed in Luxemburg called the European Stability Mechanism (ESM). It’s the debts held by the ESM, and the loans disbursed by the ESM, that have been the focus of the new game of extend and pretend that is called variously ‘debt-relief’ and Greece ‘being back in the markets.’

Consider the following. The ESM lent 86 Billion Euro to Greece between August 2015 and July 2018. The final tranche of these loans will not be paid back until 2060, with payments beginning in 2034. This ten year deferral of payments along with an interest rate reduction to an average of 1.62% across issues is the much heralded debt relief agreement of June 21st 2018. All things considered, and given real ‘go to the market’ alternatives if you have Greece’s bond rating, this is not a bad deal – on paper. These measures, plus the final bailout cash being added to cash reserves, means that Greece will actually not have to return to the markets for funding for almost two years. Given this, the ‘return to the markets’ comes with some pretty large airbags, all of which makes buying Greek debt more attractive, hence recent bond rating upgrades. So, we are extending, but what are we still pretending?

“..Pabst Blue Ribbon by the case!”

• The Winners Will Lose and the Losers Will Win (Kunstler)

What a revoltin’ development, as Chester A. Riley used to say on “The Life of Riley” TV show back in 1955, when America was great (at least that’s the theory). Riley was an original deplorable before the concept even emerged from the murk of early pop culture. He worked in an aircraft factory somewhere in southern California, which only a few decades prior was the mecca of an earlier generations of losers: the Oakies and other Dust Bowl refugees who went west to pick fruit or get into the movies. Chester A. Riley supported a family on that job as a wing-riveter. All the male characters in the series had been through the Second World War, but were so far removed from the horror that the audience never heard about it.

That was the point: to forget all that gore and get down with the new crazes for backyard barbeque, seeing the USA in your Chevrolet, enjoying that healthful pack of Lucky Strikes in the valley of the Jolly Green Giant… double your pleasure, double your fun… and away go troubles down the drain…. As Tom Wolfe pointed out eons ago, the most overlooked feature of post-war American life was the way that the old US peasantry found themselves living higher on the hog than Louis the XVI and his court at Versailles. Hot and cold running water, all the deliciously engineered Betty Crocker cake you could eat, painless dentistry, and Yankees away games on Channel 11, with Pabst Blue Ribbon by the case! By 1960 or so, along came color TV and air-conditioning, and in places like Atlanta, St. Louis, and Little Rock, you barely had to go outside anymore, thank God! No more heat stroke, hookworm, or chiggers.

It was a helluva lot better than earlier peasant classes had it, for sure, but let’s face it: it was kind of a low-grade nirvana. And a couple of generations beyond “The Life of Riley” the whole thing has fallen apart. There are few hands-on jobs that allow a man to support a family. And what would we even mean by that? Stick the women back in kitchen and the laundry room? What a waste of human capital (even for socialists who oppose capital). The odd thing is that there is increasingly little for this class of people to do besides stand near the door of the WalMart, and if the vaunted tech entrepreneurs of this land have their way with robotics, you can be sure there would be less than nothing for them to do… except crawl off and die quietly, without leaving an odoriferous mess.

Long read. Steve Keen comments: This will doom the USA to stagnation: a generation with too much debt and no prospect of using credit like the previous generation.

• The Inescapable Weight Of My $100,000 Student Debt (G.)

On Halloween in 2008, about six weeks after Lehman Brothers collapsed, my mother called me from Michigan to tell me that my father had lost his job in the sales department of Visteon, an auto parts supplier for Ford. Two months later, my mother lost her job working for the city of Troy, a suburb about half an hour from Detroit. From there our lives seemed to accelerate, the terrible events compounding fast enough to elude immediate understanding. By June, my parents, unable to find any work in the state where they spent their entire lives, moved to New York, where my sister and I were both in school. A month later, the mortgage on my childhood home went into default.

After several months of unemployment, my mother got a job in New York City, fundraising for a children’s choir. In the summer of 2010, I completed my studies at New York University, where I received a BA and an MA in English literature, with more than $100,000 of debt, for which my father was a guarantor. My father was still unemployed and my mother had been diagnosed with an aggressive form of breast cancer. She continued working, though her employer was clearly perturbed that she would have to take off every Friday for chemotherapy. To compensate for the lost time, on Mondays she rode early buses into the city from the Bronx, where, after months of harrowing uncertainty, my parents had settled. She wanted to be in the office first thing.

In January 2011, Chase Bank took full possession of the house in Michigan. Our last ties were severed by an email my father received from the realtor, who had tried and failed to sell the property, telling him he could now cancel the utilities. In May, I got a freelance contract with a newspaper that within a year would hire me full-time – paying me, after taxes, roughly $900 every two weeks. In September 2011, my parents were approved for bankruptcy, and in October, due to a paperwork error, their car was repossessed in the middle of the night by creditors. Meanwhile, the payments for my debt – which had been borrowed from a variety of federal and private lenders, most prominently Citibank – totalled about $1,100 a month.

Debt Rattle August 19 2018

Aug 192018

August 19, 2018 Posted by Raúl Ilargi Meijer at 8:36 am Finance Tagged with: Brexit, coup, dollar, Ecuador, Erdogan, FBI, Jimmy Carter, liquidity, Mueller, Putin, Steele, Syria, Trump 3 Responses »

Pablo Picasso Portrait of Ambroise Vollard 1910

• Anatomy of a Crisis: A Strong Dollar and Disappearing Liquidity (Palisade)

• Speculators Will Make Hay From Great Australian Economic Crash (Steve Keen)

• Judge Rules FBI Must Address Measures Taken To Verify Steele Dossier (ZH)

• White House Counsel “Cooperating Extensively” With Obstruction Probe (ZH)

• Erdogan Says US Has Launched ‘Attempted Economic Coup’ (Ind.)

• No-Deal Brexit May Force Rethink Of Vote – Ex-Civil Service Head (PA)

• Putin Urges Europe To Help Rebuild Syria So Refugees Can Return (AFP)

• Ecuador Slams Door On Venezuelans (BBC)

• The Un-Celebrity President (WaPo)

• Britain Has One Last Chance To Save Endangered Species (G.)

When liquidity vanishes the dollar rises.

• Anatomy of a Crisis: A Strong Dollar and Disappearing Liquidity (Palisade)

Since March – the dollar’s rallied over 7%. And it’s caused the Emerging Markets to implode. But the bigger problem is what lies ahead. And that’s a global dollar shortage – which the mainstream continues to ignore. . . I’ve touched on this a couple months back. Wondering when the mainstream would start to realize that the stronger the dollar gets – the more pressure global economies will feel. I wrote. . . “This is going to cause an evaporation of dollar liquidity – making the markets extremely fragile. Putting it simply – the soaring U.S. deficit requires an even greater amount dollars from foreigners to fund the U.S. Treasury. But if the Fed is shrinking their balance sheet, that means the bonds they’re selling to banks are sucking dollars out of the economy (the reverse of Quantitative Easing which was injecting dollars into the economy). This is creating a shortage of U.S. dollars – the world’s reserve currency – therefore affecting every global economy.”

Since then, things have only gotten worse. . . First: Jerome Powell – the Fed Chairman – issued a statement at the end of June that they would actually increase the amount of rate hikes over the next two years. This means they’re tightening even faster. Second: the U.S. Treasury increased their debt-borrowing needs to the highest since the financial crisis – which was over a decade ago. Therefore, they will need even more dollars to fund their spending. “The department expects to issue $329 billion in net marketable debt from July through September, the fourth-largest total for that quarter on record and higher than the $273 billion estimated in April [a 17% increase], the Treasury said in a report Monday. The department’s forecast for the October-December quarter is $440 billion, bringing the second-half borrowing estimate to $769 billion, the highest since $1.1 trillion in July-December 2008…”

And third: China’s growth is slowing down. Meanwhile the Emerging Markets are draining their U.S. dollar reserves even faster because of the strengthening dollar. So, in summary: as global dollar liquidity continues drying up, there will be a wave of ‘risky’ positions being dumped and ‘dollar disease’ (selling assets to raise dollars to pay back debts) worldwide. . . What we know is true from Economics-101 is that the lower the supply and the greater the demand equals a higher price. And as the pool of USD keeps drying up – then the price of the dollars must rise. This translates into higher offshore dollar funding (higher interest rates). Which is killing dollar indebted countries and corporations – like Turkey today.

[..] I think future financial historians will scratch their heads wondering why markets today continued discounting this serious dollar-shortage problem. The easy money years post-2008 fueled a massive debt bubble – causing asset prices all over to rise. But the market isn’t expecting the tight money years today to cause asset prices to fall. It’s like they think that drinking alcohol today will make them feel good – but don’t believe they’ll be hungover tomorrow. So, what’s next? I believe the U.S. dollar will continue rallying because of all that I mentioned above. As Hedge Funds, institutions, and investors continue unloading their Emerging Market positions – things will only get worse.

Housing bubble vs stock market bubble. Pick your fave toxin.

• Speculators Will Make Hay From Great Australian Economic Crash (Steve Keen)

For years, Australia has been seen as the goose which laid the golden egg for workers, migrants and investors. Ironically, as America’s casino closes, it will eventually end up as a speculator’s paradise.\ The performance of the Australian stock market relative to its American equivalent since the Global Financial Crisis (GFC) shows the difference between a country where Quantitative Easing (QE) – the buying of bonds by the central bank to drive bond prices up and interest rates down, and thus encourage firms to invest and financial institutions to buy shares – was practiced and one where it was not. It’s both a warning about what could happen when the Fed starts to unwind QE, and a perverse opportunity to profit when Australia’s central bank, the RBA (Reserve Bank of Australia) inevitably starts its own QE program.

Since Australia avoided the GFC, and its rate of economic growth has been twice as fast as America’s post-crisis (an average 2.7 percent per year, versus 1.3 percent for the US), you might expect Australia’s stock market to have done better than America’s. In fact, it’s performed much worse: the main Australian index, the ASX, still hasn’t returned to its mid-2000s peak, while the US S&P500 has more than doubled its pre-crash level, and it’s almost four times as high as it was in the deepest depths of 2009. The timing of the US stock market recovery is instructive: it began in February 2009, just three months after the Federal Reserve began “QE1” (the first of three episodes of Quantitative Easing), when it promised to net buy bonds from the financial sector to the tune of $1 trillion per year ($80 billion per month).

With the Fed buying a trillion bucks worth of bonds every year, thus giving the financial sector one trillion in cash per year in place of its interest-earning bonds, the only place the financial sector could stash that dough in search of a return was the stock market. This was the intention of the policy of course: to drive share prices higher in order to stimulate the economy. Aside from the fact it’s made the wealthier even wealthier as a direct effect of government policy, and cost far more than a direct boost to the poor would have done, it’s worked a treat: according to Robert Shiller’s “Cyclically Adjusted Price to Earnings Ratio,” it’s driven America’s stock market to its second-highest peak in history, higher than the 1929 bubble, second only to the DotCom maximum in 2000, and more than twice its long-term average.

Can’t hide behind declassified docs.

• Judge Rules FBI Must Address Measures Taken To Verify Steele Dossier (ZH)

The FBI has been dealt a major blow after a Washington DC judge ruled that the agency must respond to a FOIA request for documents concerning the bureau’s efforts to verify the controversial Steele Dossier, before it was used as the foundation of a FISA surveillance warrant application and subsequent renewals. US District Court Judge Amit Mehta – who in January sided with the FBI’s decision to ignore the FOIA request, said that President Trump’s release of two House Intelligence Committee documents (the “Nunes” and “Schiff” memos) changed everything.

Considering that the FBI offered Steele $50,000 to verify the Dossier’s claims yet never paid him, BuzzFeed has unsuccessfully tried to do the same to defend themselves in a dossier-related lawsuit, and a $50 million Soros-funded investigation to continue the hunt have turned up nothing that we know of – whatever documents the FBI may be forced to cough up regarding their attempts to verify the Dossier could prove highly embarrassing for the agency. “[I]f Mr. Steele could get solid corroboration of his reports, the F.B.I. would pay him $50,000 for his efforts, according to two people familiar with the offer. Ultimately, he was not paid.” -NYT

What’s more, forcing the FBI to prove they had an empty hand will likely embolden calls to disband the special counsel investigation – as the agency’s mercenary and politicized approach to “investigations” will be laid all the more bare for the world to see. Then again, who knows – maybe the FBI verified everything in the dossier and it simply hasn’t leaked. That said, while the FBI will likely be forced to acknowledge the documents thanks to the Thursday ruling, the agency will still be able to try and convince the judge that there are other grounds to withhold the records.

In January, Mehta blessed the FBI’s decision not to disclose the existence of any records containing the agency’s efforts to verify the dossier – ruling that Trump’s tweets about the dossier didn’t require the FBI and other intelligence agencies to act on records requests. “But then the ground shifted,” writes Mehta of Trump declassifying the House memos. “As a result of the Nunes and Schiff Memos, there is now in the public domain meaningful information about how the FBI acquired the Dossier and how the agency used it to investigate Russian meddling.” [..] “It remains no longer logical nor plausible for the FBI to maintain that it cannot confirm nor deny the existence of documents,” Mehta wrote.

Doesn’t feel like McGahn has tons of dirt.

• White House Counsel “Cooperating Extensively” With Obstruction Probe (ZH)

Update: Trump has commented on the story, saying he allowed McGahn “and all other requested members of the White House Staff” to fully cooperate with the Special Counsel. He also notes that the White House has given over one million pages of documents adding “No Collusion, No Obstruction. Witch Hunt!”

White House counsel Donald McGahn II, has been quietly cooperating “extensively” with special counsel Robert Mueller in his probe of possible collusion between the Trump campaign and Russia, according to an explosive New York Times report published Saturday afternoon. Sources told the Times that McGahn has had at least three voluntary interviews with Mueller’s team totaling 30 hours, in which he discussed accounts of multiple episodes at the center of Mueller’s probe into whether President Trump obstructed justice, as well as the president’s furor toward the Russia investigation and the ways in which he urged McGahn to respond to it. For a lawyer to share so much with investigators scrutinizing his client is unusual.

Lawyers are rarely so open with investigators, not only because they are advocating on behalf of their clients but also because their conversations with clients are potentially shielded by attorney-client privilege, and in the case of presidents, executive privilege. Among the episodes McGahn reprotedly discussed with investigators is Trump’s firing last year of former FBI Director James Comey and the president’s repeated urging of Attorney General Jeff Sessions to claim oversight of the special counsel despite his recusal from Russia probes. McGahn was also centrally involved in Trump’s attempts to fire the special counsel, Robert Mueller, himself which investigators might not have discovered without him.

Downgrades add to the downfall.

• Erdogan Says US Has Launched ‘Attempted Economic Coup’ (Ind.)

Turkey’s president has accused America of launching an “attempted economic coup” as the country’s currency continues to reel following US economic sanctions. Recep Tayyip Erdogan told thousands of supporters in Ankara: “Today some people are trying to threaten us through the economy, through interest rates, foreign exchange, investment and inflation. “We are telling them: we’ve seen your games, and we are challenging you.” And, in a clear swipe at US president Donald Trump he added: “We did not and will not surrender to those who act like a strategic partner but make us a strategic target.”

[..] As the two countries have clashed, the lira’s value has plummeted: it has now dropped 38 per cent against the dollar since the beginning of the year. On Friday, ratings agencies Standard & Poor and Moody’s downgraded Turkey’s credit rating closer to “junk” status, pointing to currency fluctuations and concerns over central bank independence. A spokesman for Standard & Poor said: “The downgrade reflects our expectation that the extreme volatility of the Turkish lira and the resulting projected sharp balance of payments adjustment will undermine Turkey’s economy. We forecast a recession next year.” He added the agency was predicting that the country’s inflation will hit a potential 22 per cent over the next four months.

When temperatures start dropping, reality will loom.

• No-Deal Brexit May Force Rethink Of Vote – Ex-Civil Service Head (PA)

Britain may have to rethink the decision to leave the EU if the government is unable to strike a Brexit deal with Brussels, a former head of the civil service has said. Bob Kerslake said the consequences of a no-deal exit would be so serious that the UK parliament would have to consider whether it could allow it to go ahead. Lord Kerslake, who has been advising Labour on preparing for government, said that at the very least the article 50 process – under which the UK is set to leave the bloc on 29 March next year – would have to be paused. In those circumstances, the European commission would almost certainly insist on some “re-examination” of the original decision to leave, he said.

His comments came as the government prepares to publish a series of technical notes on preparations for a no-deal Brexit across dozens of areas of British life, from farming to financial services. Kerslake said the measures were “too little, too late” and that the government had not allowed itself enough time to prepare for such an outcome. He told the the BBC Radio 4’s Today programme: “The consequences of a no deal would be so serious as I think parliament would have to seriously consider whether it could contemplate this. “The question people need to ask themselves is, is this a risk that they think we should be taking?

“If the government can negotiate a good deal, then so be it. But if they can’t and we end up in this position, then we have to reopen the question of whether we go forward with Brexit at all. It is not too late to do that. “A pause to reflect would certainly be necessary. I think that is a pretty high probability now. “But I think that pause would need to include – and I suspect this would be insisted on by the commission – some re-examination of the decision itself.”

The only thing that makes sense.

• Putin Urges Europe To Help Rebuild Syria So Refugees Can Return (AFP)

Russian president Vladimir Putin has called on Europe to contribute to the reconstruction of Syria to allow millions of refugees to return home. “We need to strengthen the humanitarian effort in the Syrian conflict,” he said on Saturday, ahead of a meeting with his German counterpart Angela Merkel at the government retreat of Meseberg Palace, north of Berlin. “By that, I mean above all humanitarian aid to the Syrian people, and help the regions where refugees living abroad can return to.” There were 1 million refugees in Jordan, the same number in Lebanon, and 3 million in Turkey, Putin said.

Germany has accepted hundreds of thousands of migrants since 2015 – the height of the migration crisis – which has weakened Angela Merkel politically and split the European Union. “This is potentially a huge burden for Europe,” Putin said. “That’s why we have to do everything to get these people back home,” he added, emphasising the need to restore basic services such as water supplies and healthcare.

More refugees. Great.

• Ecuador Slams Door On Venezuelans (BBC)

Ecuador has brought in new rules to stop Venezuelan migrants entering the country without a passport, leaving many stranded in neighbouring Colombia. Thousands of Venezuelans fleeing their country’s economic and political crisis have been crossing into Ecuador from Colombia using only identity cards. Most are heading south to join family members in Peru and Chile. Colombia has protested against the move, saying vulnerable people will be trapped on its side of the border. In a separate incident, residents of a Brazilian town attacked a Venezuelan migrant camp on Saturday and drove the occupants back across the border. Venezuela has suffered for years from high inflation and the chronic shortage of food and medicines.

More than a million Venezuelan migrants have entered Colombia in the past 15 months, according to official estimates, and more than 4,000 have been arriving at Ecuador’s border every day. Many have been walking or hitching rides for weeks and are exhausted by the time they reach the frontier. [..] With the flow of Venezuelan migrants causing tensions across the region, Peru’s government announced immigration measures similar to Ecuador’s on Friday. Passport requirements for Venezuelans will begin on 25 August. In February, Colombian President Juan Manuel Santos announced a tightening of border controls, resulting in thousands of Venezuelans rushing to crossing points. Brazil, which neighbours Venezuela, has also expressed concerns and temporarily closed the border earlier this month. Violence has flared in the border state of Roraima where thousands of Venezuelans live in precarious accommodation.

“Carter has been an ex-president for 37 years, longer than anyone else in history.”He used those years to redeem himself.

• The Un-Celebrity President (WaPo)

Jimmy Carter finishes his Saturday night dinner, salmon and broccoli casserole on a paper plate, flashes his famous toothy grin and calls playfully to his wife of 72 years, Rosalynn: “C’mon, kid.” She laughs and takes his hand, and they walk carefully through a neighbor’s kitchen filled with 1976 campaign buttons, photos of world leaders and a couple of unopened cans of Billy Beer, then out the back door, where three Secret Service agents wait. They do this just about every weekend in this tiny town where they were born — he almost 94 years ago, she almost 91. Dinner at their friend Jill Stuckey’s house, with plastic Solo cups of ice water and one glass each of bargain-brand chardonnay, then the half-mile walk home to the ranch house they built in 1961.

On this south Georgia summer evening, still close to 90 degrees, they dab their faces with a little plastic bottle of No Natz to repel the swirling clouds of tiny bugs. Then they catch each other’s hands again and start walking, the former president in jeans and clunky black shoes, the former first lady using a walking stick for the first time. The 39th president of the United States lives modestly, a sharp contrast to his successors, who have left the White House to embrace power of another kind: wealth. Even those who didn’t start out rich, including Bill Clinton and Barack Obama, have made tens of millions of dollars on the private-sector opportunities that flow so easily to ex-presidents.

When Carter left the White House after one tumultuous term, trounced by Ronald Reagan in the 1980 election, he returned to Plains, a speck of peanut and cotton farmland that to this day has a nearly 40 percent poverty rate. The Democratic former president decided not to join corporate boards or give speeches for big money because, he says, he didn’t want to “capitalize financially on being in the White House.” Presidential historian Michael Beschloss said that Gerald Ford, Carter’s predecessor and close friend, was the first to fully take advantage of those high-paid post-presidential opportunities, but that “Carter did the opposite.” Since Ford, other former presidents, and sometimes their spouses, routinely earn hundreds of thousands of dollars per speech. “I don’t see anything wrong with it; I don’t blame other people for doing it,” Carter says over dinner. “It just never had been my ambition to be rich.”

One field where EU regulation is very harmful.

• Britain Has One Last Chance To Save Endangered Species (G.)

Ministers may have only 12 months to rescue Britain’s degraded environment and to save its endangered birds and animals. That is the stark conclusion of Michael Clarke, chief executive of the RSPB, who has warned that parliamentary bills – to be published over the next year – will have to make crucial changes to the way our farms and fisheries are run if the wildlife and landscape of the nation are to be rescued from their dangerously depleted condition. “We are on a cusp, and if we fail to act decisively we will pay the price in coming years,” Clarke told the Observer last week. The three forthcoming bills – on agriculture, on fisheries and on the environment – will replace the EU legislation that currently controls our farming, fishing industry and the quality of our air, water and wildlife.

The government has yet to announce what these bills will contain. However, conservationists such as Clarke now fear there is a real risk that one or all of these new pieces of legislation will fail to provide the necessary powers to restore our crisis-hit environment. “Since 1980, across Europe 420 million individual birds have disappeared from the countryside thanks to the practices of modern agriculture,” said Clarke. And that staggering drop is matched by an even more catastrophic decline in insect life over the same period of time, he added. “For years, we could see the lack of insects on our windscreens on summer evenings. It was a smoking gun but there was no hard data – until recent research in Germany showed there had been a 75% decline in its flying insects, figures since matched by Dutch and some UK data. The insects have gone – and so have 420 million birds.”

[..] As to the causes of these declines, the intensification and spread of agriculture and changes in land use take most of the blame – with the EU common agricultural policy (CAP) being considered a particularly destructive agent in this process. The CAP stresses the importance of agricultural output above all else and has helped destroy the homes and food sources of countless birds, animals and insects, said Clarke. Crucially, as Britain prepares to withdraw from the CAP and the EU, the nation has a once-in-a-generation opportunity to put right this damage, said Clarke. About £3bn a year is spent on British farming through CAP, he pointed out.

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