Jun 022019
 
 June 2, 2019  Posted by at 10:14 am Finance Tagged with: , , , , , , , , , ,  


 

On 30th Anniversary, China Says Tiananmen Crackdown Was ‘Correct’ Policy (AFP)
China Vows Military Action If Taiwan, Sea Claims Opposed (AP)
China Says Trade War ‘Has Not Made America Great Again’ (AFP)
China Vice Minister Says US Overestimates Trade Deficit (R.)
A Free Press Is Not An Optional Extra – Jeremy Hunt (PA)
Austerity To Blame For 130,000 ‘Preventable’ UK Deaths (O.)
Brexit Party Tops Westminster Election Poll For First Time (G.)
Only A National Government Can Deliver Britain From Its Brexit Nightmare (G.)
Boeing Built Deadly Assumptions Into 737 Max (NYT)
Airlines Want Joint Lifting Of 737 Max Ban, But EU Cautious (R.)
EU Reserves Right To Take Own Decisions On Boeing 737 MAX (R.)
Monsanto Manipulates Journalists And Academics (G.)
Save The Solenodons (O.)

 

 

Why does this make me think of John Bolton and Mike Pompeo?

On 30th Anniversary, China Says Tiananmen Crackdown Was ‘Correct’ Policy (AFP)

China on Sunday defended the bloody Tiananmen crackdown on student protesters in a rare public acknowledgement of the event, days before its 30th anniversary, saying it was the “correct” policy. After seven weeks of protests by students and workers demanding democratic change and the end of corruption, soldiers and tanks chased and killed demonstrators and onlookers in the streets leading to Beijing’s Tiananmen Square on June 4 1989. Hundreds, or possibly more than 1,000, were killed, although the precise number of deaths remains unknown. “That incident was a political turbulence and the central government took measures to stop the turbulence which is a correct policy,” Chinese defence minister General Wei Fenghe told a regional security forum in Singapore.

Wei asked why people still say that China “did not handle the incident properly”. “The 30 years have proven that China has undergone major changes,” he said in response to a question from the audience, adding that because of the government’s action at that time “China has enjoyed stability and development”. Bonnie Glaser, a China expert at the Center for Strategic and International Studies in Washington, said she was surprised at the question on Tiananmen raised at an open forum after Wei’s speech, but the fact that the general answered it was “unusual”. People may dispute Wei’s answer “but at least I can give him credit for taking the question”, Glaser added.

Inside China an army of online censors have scrubbed clean social media, removing articles, memes, hash-tags or photos alluding to the Tiananmen crackdown ahead of June 4. Discussions of the 1989 pro-democracy protests and their brutal suppression are strictly taboo, and authorities have rounded up or warned activists, lawyers and journalists ahead of the anniversary each year. Talking privately with family and friends about Tiananmen is possible, but any commemoration in public risks almost certain arrest.

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More Bolton and Pompeo. the US and China could swap “leaders” and nothing would change.

China Vows Military Action If Taiwan, Sea Claims Opposed (AP)

China’s defense minister warned Sunday that its military will “resolutely take action” to defend Beijing’s claims over self-ruled Taiwan and disputed South China Sea waters. Speaking at an annual security conference in Singapore, Gen. Wei Fenghe did not direct the threat at the U.S. but loaded his address with criticism of activities by Washington, including support for Taiwan and leading so-called freedom of navigation operations in the strategic waterways that China virtually claims as its own. Wei said the People’s Liberation Army would not “yield a single inch of the country’s sacred land.”

China’s ruling Communist Party maintains that Taiwan is part of China, and has used increasingly aggressive rhetoric toward the democratic island, which split from the mainland amid a civil war 70 years ago. It opposes Taiwan’s independence and formally says it seeks a “peaceful reunification” while refusing to rule out the use of force if necessary to achieve that goal. “The PLA has no intention to cause anybody trouble but it is not afraid to face up to troubles. Should anybody risk crossing the bottom line, the PLA will resolutely take action and defeat all enemies,” Wei said.

Relations between Beijing and Taipei have deteriorated since Taiwan elected a pro-independence president, Tsai Ing-wen, in 2016. China has since increased diplomatic pressure, cut off its contacts with the island’s government and discouraged travel there by Chinese tourists. “China must be and will be reunified. We find no excuse not to do so. If anyone dares to split Taiwan from China, the Chinese military has no choice but to fight at all costs, at all costs, for national unity,” Wei stressed. “We will strive for the prospect of peaceful unification with utmost sincerity and greatest efforts, but we make no promise to renounce the use of force.” Wei was addressing defense chiefs, officials and academics at the Shangri-La Dialogue in Singapore.

U.S. Acting Defense Secretary Patrick Shanahan, who spoke to the same gathering on Saturday, was not present at Wei’s speech. Shanahan called China’s efforts to steal technology from other nations and militarize man-made outposts in the South China Sea a “toolkit of coercion” and urged it to stop activities the U.S. perceives as hostile. China is pitted against smaller Southeast Asian neighbors in multiple disputes over island reefs, corals and lagoons in the South China Sea, where it constructed seven outposts equipped with airstrips, radar and missile stations that Shanahan said Saturday could become “tollbooths” in one of the world’s busiest waterways.

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On this, China is getting nervous.

China Says Trade War ‘Has Not Made America Great Again’ (AFP)

Washington’s escalating trade war with Beijing has not “made America great again” and has instead damaged the American economy, China said Sunday, warning that while it wants resolution through talks there will be no compromise on core principles. Beijing’s broadside is the latest act in a bruising conflict between the world’s top two economies that has spooked markets and sparked fears about the global economy. With trade talks stalled, the dispute has intensified in recent weeks with US President Donald Trump imposing fresh tariffs on imports from China and moving to blacklist Chinese tech titan Huawei over national security concerns.


“The (US) tariff measures have not boosted American economic growth. Instead, they have done serious harm to the US economy,” the Chinese government said in a white paper, pointing to what it described as increased production costs and consumer prices in the United States and threats to economic growth. “The trade war has not ‘made America great again’,” it said, referring to Trump’s political slogan made famous during his 2016 presidential campaign. The white paper’s release came a day after China hit $60 billion worth of US goods with new punitive tariffs ranging from five to 25 percent, in retaliation for Washington raising duty on $200 billion in Chinese goods to 25 percent.

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Nervous walking back.

China Vice Minister Says US Overestimates Trade Deficit (R.)

Chinese Vice Commerce Minister Wang Shouwen said on Sunday the United States overestimates the trade deficit between the two countries and China should not be blamed for job losses in the U.S. manufacturing sector. Wang told a news conference the U.S. goods and services deficit with China is actually closer to $150 billion and not the $410 billion quoted by U.S. officials. China’s processing trade with the United States should not be included in trade deficit calculations, he added. Wang said China should not be blamed for job losses in the U.S. manufacturing sector. He also said China does not instruct domestic companies to acquire certain projects and technology.


Wang said the commerce ministry is investigating reports of delays in customs checks, adding that the country will make efforts to cut the length of customs checks and reduce costs for importers. Wang said that it is “unacceptable” if some countries use rare earths from China to create products that limit China’s development, and he said China is willing to meet other countries’ requirements for rare earth consumption.

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Hunt is just a sociopath. Britain’s class society guarantees people like him float to the top. But where are the protests from more normal people regarding Assange? Or has the country run out of normal people?

A Free Press Is Not An Optional Extra – Jeremy Hunt (PA)

A free media is an essential “pillar of a thriving society”, Foreign Secretary Jeremy Hunt has insisted. Mr Hunt spoke out on the role of journalists in “holding the powerful to account, exposing wrongdoing, deterring corruption and strengthening democracy”. The Tory leadership hopeful will host the world’s first ministerial summit on media freedom in London next month. He said: “We can’t physically stop journalists from being locked up for doing their jobs, but we can alert global public opinion and make sure the diplomatic price is too high.” Mr Hunt used his speech to the World News Media Congress in Glasgow to pay tribute to murdered journalist Lyra McKee, who was shot dead while working in Northern Ireland in April.


He said the “senseless killing of a talented young journalist showed here in the United Kingdom we too have no cause for complacency”. And he also hailed Reuters journalists Wa Lone and Kyaw Soe Oo, who spent more than 500 days in jail in Burma after reporting on the massacre of 10 Rohingya Muslims. Mr Hunt is now working with Canadian foreign affairs minister Chrystia Freeland to “shine a spotlight on abuses and raise the cost for those who harm journalists for doing their jobs”.

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What you get in a class system.

Austerity To Blame For 130,000 ‘Preventable’ UK Deaths (O.)

More than 130,000 deaths in the UK since 2012 could have been prevented if improvements in public health policy had not stalled as a direct result of austerity cuts, according to a hard-hitting analysis to be published this week. The study by the Institute for Public Policy Research (IPPR) thinktank finds that, after two decades in which preventable diseases were reduced as a result of spending on better education and prevention, there has been a seven-year “perfect storm” in which state provision has been pared back because of budget cuts, while harmful behaviours among people of all ages have increased.

Had progress been maintained at pre-2013 rates, around 131,000 lives could have been saved, the IPPR concludes. Despite promises made during the NHS’s 70th birthday celebrations last year to prioritise prevention, the UK is now only halfway up a table of OECD countries on its record for tackling preventable diseases. The report is concerned with preventable diseases or disorders such as heart disease, lung cancer or liver problems, which can be caused by unhealthy lifestyles and habits, formed often at a young age. It finds evidence of disturbing reductions in physical activity in schools and chronic underfunding of health visitors.

The lead researcher and author, Dean Hochlaf, said: “We have seen progress in reducing preventable disease flatline since 2012. At the same time, local authorities have seen significant cuts to their public health budgets, which has severely impacted the capacity of preventative services. “Social conditions for many have failed to improve since the economic crisis, creating a perfect storm that encourages harmful health behaviours. This health challenge will only continue to worsen.”

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Let him have it if no-one stands up for Assange. Corbyn is silent on the topic, which makes him a useless tool.

Brexit Party Tops Westminster Election Poll For First Time (G.)

Nigel Farage’s Brexit party has surged into first place as voters’ favourites, according to a new poll. It is the first time the party has achieved top position in a national poll. The results suggest hundreds of Conservative seats are at risk. The Brexit party’s support increased by two points to 26% of the vote in the latest Opinium poll – for the Observer – which asked people how they would vote in the next Westminster election. Labour is in second place on 22%, but its support has fallen by seven points over the past two weeks. The Tories are third on 17%, with their support down five points, and the Lib Dems are up five points, on 16% of the vote.


These results come after a poll last week put the Lib Dems in first place, in another sign that parties with a clear position on Brexit are gaining support while the Conservatives and Labour continue to grapple with their stances on leaving the EU. Both parties are under pressure to set out their pro-Brexit or pro-Remain positions more unequivocally. According to a seat predictor by the Electoral Calculus website, the result would leave Farage 20 seats short of a majority, with 306 MPs. The Conservatives would be reduced to 26 MPs, suggesting they could be the minor party in a coalition with Farage. However, inconsistent swings in different seats make any such predictions very difficult.

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Ed Davey is the MP for Kingston and Surbiton. He’s been in a coma for the past 3 years. And failed to see how toxic Brexit has become.

Only A National Government Can Deliver Britain From Its Brexit Nightmare (G.)

First, this backbench coalition must come together to prevent an incoming Tory leader proroguing parliament and forcing a no-deal Brexit on an increasingly doubtful public. If Boris Johnson tried that, it would be an effective putsch or coup d’etat against parliament. MPs who vote to stop such a hard Brexit no-deal coup would, in effect, self-select as supporters of a national government. This is no attempt to gain power through coalition. Such a government of national unity would be short-lived and have one policy: to deliver a referendum. Even if more policy agreement could be found, there would be no point: as Theresa May has demonstrated, government currently lacks bandwidth to deliver Brexit, let alone more.


After a referendum, there would soon have to be a general election. Other MPs could return to their parties, and as Liberal Democrat leader I would take my party back into opposition and fight to win that election. But in parliament today we should recognise that Brexit has broken the party system. And just as one party proved incapable of delivering Brexit, so we will need more than one party to stop Brexit. Meanwhile, we need pro-European Labour figures who voted LibDem in their thousands to join us to give this move momentum (in the genuine sense of the word). I disagreed profoundly with Alastair Campbell and co over Iraq, but on the great issue of today we are on the same side against hard-right, dangerous nationalism.

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Maybe it takes the New York Times for people to wake up. It’s not a software problem.

Boeing Built Deadly Assumptions Into 737 Max (NYT)

The fatal flaws with Boeing’s 737 Max can be traced to a breakdown late in the plane’s development, when test pilots, engineers and regulators were left in the dark about a fundamental overhaul to an automated system that would ultimately play a role in two crashes. A year before the plane was finished, Boeing made the system more aggressive and riskier. While the original version relied on data from at least two types of sensors, the ultimate used just one, leaving the system without a critical safeguard. In both doomed flights, pilots struggled as a single damaged sensor sent the planes into irrecoverable nose-dives within minutes, killing 346 people and prompting regulators around the world to ground the Max.

But many people involved in building, testing and approving the system, known as MCAS, said they hadn’t fully understood the changes. Current and former employees at Boeing and the Federal Aviation Administration who spoke with The New York Times said they had assumed the system relied on more sensors and would rarely, if ever, activate. Based on those misguided assumptions, many made critical decisions, affecting design, certification and training. “It doesn’t make any sense,” said a former test pilot who worked on the Max. “I wish I had the full story.”

[..] At first, MCAS — Maneuvering Characteristics Augmentation System — wasn’t a very risky piece of software. The system would trigger only in rare conditions, nudging down the nose of the plane to make the Max handle more smoothly during high-speed moves. And it relied on data from multiple sensors measuring the plane’s acceleration and its angle to the wind, helping to ensure that the software didn’t activate erroneously. Then Boeing engineers reconceived the system, expanding its role to avoid stalls in all types of situations. They allowed the software to operate throughout much more of the flight. They enabled it to aggressively push down the nose of the plane. And they used only data about the plane’s angle, removing some of the safeguards.

[..] The current and former employees, many of whom spoke on the condition of anonymity because of the continuing investigations, said that after the first crash, they were stunned to discover MCAS relied on a single sensor. “That’s nuts,” said an engineer who helped design MCAS. “I’m shocked,” said a safety analyst who scrutinized it. “To me, it seems like somebody didn’t understand what they were doing,” said an engineer who assessed the system’s sensors.

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In case of a next accident, they want to spread the blame.

Airlines Want Joint Lifting Of 737 Max Ban, But EU Cautious (R.)

Airlines urged regulators on Sunday to coordinate on software changes to the Boeing 737 MAX in a bid to avoid damaging splits over safety seen when the aircraft was grounded in March. The International Air Transport Association (IATA), whose 290 carriers account for 80 percent of world flying, said trust in the certification system had been damaged by a wave of separate decisions to ground the jet, with the U.S. last to act. Airlines are worried further differences between regulators over safety could confuse passengers and cause disruption. “Any rift between regulators is not in anyone’s interest,” IATA Director General Alexandre de Juniac told an annual meeting of the association in Seoul.


Boeing’s best-selling jet was grounded after two crashes, in Indonesia and Ethiopia, over five months killed a total of 346 people. The Federal Aviation Administration initially resisted the decisions led by China, but later followed suit. Airline officials say any new bout of staggered decisions could cause problems in operations and code-sharing. “Obviously for us to operate the MAX, the approval from the Singapore authorities is not enough. We have to operate somewhere … Indonesia and China are two important markets for us,” Singapore Airlines CEO Goh Choon Phong told Reuters. But the European Union’s top transport official said bloc’s regulator, the European Aviation Safety Agency, reserved the right to carry out its own separate review at its own pace.

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EU=Airbus.

EU Reserves Right To Take Own Decisions On Boeing 737 MAX (R.)

The European Union will work with other regulators on the approval of new software for the Boeing 737 MAX but reserves the right to take its own decision on when to return the grounded jet to service, the bloc’s transport chief said on Sunday. “Certainly EASA will take a very close look at the results (of proposed design changes) and then make a decision and that message was very clearly passed,” Transport Commissioner Violeta Bulc said, referring to the European Aviation Safety Agency. “We always work together with other regulators and we certainly will take joint moves, but EASA will reserve the right to take an individual look at the results and then of course engage with the rest of the regulators,” she told Reuters. Asked how long it would take to resolve the Boeing crisis, she said, “I hope as soon as possible because we do need to restore order and trust and move on”.

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No. Kidding.

Monsanto Manipulates Journalists And Academics (G.)

We recently learned that a young woman falsely posing as a freelance BBC reporter at one of the Roundup cancer trials was in fact a “reputation management” consultant for FTI Consulting, whose clients include Monsanto. The woman spent time with journalists who were covering the Hardeman v Monsanto trial in San Francisco, pretending to do reporting while also suggesting to the real reporters certain storylines or points that favored Monsanto. Lawyer Tim Litzenburg, who represents several plaintiffs suing Monsanto over claims Roundup causes cancer, told me that he has traced what he calls a “dark money project” by Monsanto aimed at winning favorable public opinion.


The project includes planting helpful news articles in traditional news outlets; discrediting and harassing journalists who refused to parrot the company’s propaganda; and secretly funding front groups to amplify pro-Monsanto messaging across social media platforms. “We now know they had pet journalists who pushed Monsanto propaganda under the guise of ‘objective reporting,’” Litzenburg, a partner with the firm Kincheloe, Litzenburg & Pendleton, told me. “At the same time, the chemical company sought to amass dossiers to discredit those journalists who were brave enough to speak out against them.” According to the internal Monsanto documents Litzenburg has received through discovery, pro-Monsanto narratives are disseminated by individuals and groups that promote the work of journalists who follow Monsanto’s desired storylines while seeking to smear and discredit journalists whose work threatens Monsanto.

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The extinction of all that you don’t know.

Save The Solenodons (O.)

Solenodons are some of Earth’s strangest creatures. Venomous, nocturnal and insectivorous, they secrete toxins through their front teeth – an unusual habit for a mammal. More to the point, the planet’s two remaining species – the Cuban and the Hispaniolan solenodon, both highly endangered – have endured, virtually unchanged, for the past 76 million years. Other related species have become extinct. And that makes solenodons very important, according to Professor Sam Turvey, of the Zoological Society of London. “They are the last fruits on an entire branch of the tree of evolution,” said Turvey, who was last month awarded one of the most prestigious awards in zoology, the Linnean medal, for his work on evolution and human impacts on wildlife.

“There are no close counterparts to solenodons left on Earth, yet they have been on the planet since the time of the dinosaurs.” Solenodons have been brought close to extinction by the mongoose, the carnivore introduced to their native islands to kill snakes and rodents. They are classic examples of an “Edge” – evolutionary distinct and globally endangered – species. This means they have no close relatives and represent our last chances to preserve entire branches or trunks of the evolutionary tree. Other examples include the critically endangered vaquita, a species of porpoise from the Gulf of California, and the Sumatran rhino.

“A lot of attention is paid to other threatened rhino species,” said Turvey, “but the Sumatran, which is down to only a few dozen survivors, is the only woolly rhino left on the planet. It is special.” These animals stand in contrast with other threatened species which have close relatives that fill similar ecological niches. The polar bear, for example, is closely related to the grizzly. Should the former die out, the latter could provide a fair amount of genetic substitution, say scientists. By contrast, there is no species that could do the same for solenodons.


The endangered Sumatran rhino, Hainan gibbon, Bactrian camel and solenodon. Composite: Alamy, Getty

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It is not true that people stop pursuing dreams because they grow old, they grow old because they stop pursuing dreams.
– Gabriel Garcia Márquez

 

 

 

 

Dec 032016
 
 December 3, 2016  Posted by at 9:51 am Finance Tagged with: , , , , , , , , , , ,  


DPC “Car ferry Michigan Central turning in ice, Detroit River” 1900

Italian Stock Exchange CEO: There Are ‘Colossal’ Short Positions On Italy (R.)
Markets Eye Europe’s ‘Fear Gauge’ As Italian Referendum Approaches (CNBC)
Is the Yellen Fed TRYING to Crash Stocks To Hurt Trump? (Summers)
China Blames Taiwan For President’s ‘Petty’ Phone Call With Trump (R.)
China Bond Yields Jump As Investors Head For Exit (MNI)
China’s ‘Extraordinary Leverage’ Tops BOE List Of Concerns (CNBC)
Do We Want House Prices Up Or Down? (AFR)
Cash Is Still King In Eurozone – Deutsche (CNBC)
Iceland Pirate Party To Try To Form Government (BBC)
UK Politicians Exempt Themselves From New Wide-Ranging Spying Laws (Ind.)
The New American Dream – A Life In Hock (Peters)
California Pensions Underfunded By $1 Trillion Or $93k Per Household (ZH)
Why US ‘News’ Media Shouldn’t Be Trusted (Zuesse)
Everything You Read About The Wars In Syria And Iraq Could Be Wrong (Ind.)
US Veterans Build Barracks For Pipeline Protesters In Cold (R.)

 

 

By Monday morning, Europe could be shaking on its brittle foundations.

Italian Stock Exchange CEO: There Are ‘Colossal’ Short Positions On Italy (R.)

Big international investors are holding huge short positions on Italian assets, the CEO of the Italian exchange said on Tuesday, days before the country holds a referendum on constitutional reform that could unseat Prime Minister Matteo Renzi. “There are colossal short positions on Italy from the U.S. and other countries where big investors are based,” said Raffaele Jerusalmi during a conference in Milan. Opinion polls conducted until a blackout period began last week showed the “no” vote comfortably in the lead, raising concerns of a political crisis and fueling market volatility. Renzi has said he would resign if Italians reject the reform.

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Spread with Bunds.

Markets Eye Europe’s ‘Fear Gauge’ As Italian Referendum Approaches (CNBC)

The Italian referendum is the current hot concern for investors, who are worrying and waiting to see if voters will reject government attempts to reform the country’s political system. Prime Minister Matteo Renzi has staked his reputation and job on the outcome, arguing a change in the legislature will usher in a nimbler, more productive Italy. However some see the predicted rejection of Renzi’s wishes as a potential opportunity for anti-European populist to gain momentum. Jan Randolph, Director of Sovereign Risk at IHS Markit said in an email Friday that worries over a potential European break-up can be measured by Europe’s “fear gauge”: The difference in yield between Italian and German debt.

“The markets are certainly focusing on this ‘spread’ – what we used to call in the old British banking days the ‘country risk spread’ as viewed by the financial markets,” Randolph said. In recent weeks, the yield spread between Italian and German 10-year government bonds has risen by more than 60 points in 60 days. Last week the spread hit a two-and-a-half year high of 188 basis points, however Reuters reported Friday that investors may be short covering as the gap between Italian and German bond yields has narrowed to 167 basis points. Jan Randolph said any blow-out of Italian yields may well be prevented by the poker hand being played by ECB President Mario Draghi’s massive bond-buying program, which many analysts expect to be extended next year.

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Entertaining ideas.

Is the Yellen Fed TRYING to Crash Stocks To Hurt Trump? (Summers)

Is Janet Yellen trying to crash stocks to screw Trump? Ever since the $USD began its bull market run in mid-2014, the Fed, lead by Janet Yellen, has intervened whenever the $USD cleared 98. The reason for this was the following… Over 47% of US corporate sales come from abroad. With the $USD spiking, pushing all other major currencies generally lower, US corporate profits began to implode. As we write this today, profits have fallen to 2012 levels. Note when this whole profit massacre began. Because of this, the Fed has “talked down” the $USD anytime it began to push higher. Until today…

Since it was announced that Trump won the Presidency, the Fed has allowed the $USD to ramp straight up. It is currently over 101…and the Fed hasn’t said a word. So we ask again… is Janet Yellen trying to crash stocks to screw Trump? We all know the Yellen Fed is one of the most political in history with Fed officials openly donating money to the Clinton campaign. Now Trump has won… the $USD soars to 101… and suddenly the Fed is silent? Not one Fed official has appeared to talk about putting off a rate hike or some other statement that might push the $USD lower…

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Entire books have been written about this in the past 12 hours or so. That, too, is fake news.

China Blames Taiwan For President’s ‘Petty’ Phone Call With Trump (R.)

U.S. President-elect Donald Trump spoke by phone with President Tsai Ing-wen of Taiwan, the first such contact between the two sides in nearly four decades, but China dismissed the call as a “petty action” by the self-ruled island it claims as its own. The 10-minute telephone call with Taiwan’s leadership was the first by a U.S. president-elect or president since President Jimmy Carter switched diplomatic recognition from Taiwan to China in 1979, acknowledging Taiwan as part of “one China”. Hours after Friday’s call, Chinese Foreign Minister Wang Yi blamed Taiwan for the exchange, avoiding what could have been a major rift with Washington just before Trump assumes the presidency. “This is just the Taiwan side engaging in a petty action, and cannot change the ‘one China’ structure already formed by the international community,” Wang said at an academic forum in Beijing, state media reported.

“I believe that it won’t change the longstanding ‘one China’ policy of the United States government.” In comments at the same forum, Wang noted how quickly President Xi Jinping and Trump had spoken by telephone after Trump’s victory, and that Trump had praised China as a great country. Wang said the exchange “sends a very positive signal about the future development of Sino-U.S. relations”, according to the Chinese Foreign Ministry’s website. Taiwan was not mentioned in that call, according to an official Chinese transcript. Trump said on Twitter that Tsai had initiated the call he had with the Taiwan president. “The President of Taiwan CALLED ME today to wish me congratulations on winning the Presidency. Thank you!” he said. Alex Huang, a spokesman for Tsai, said: “Of course both sides agreed ahead of time before making contact.”

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“When everyone heads for the exit at the same time, there’s a risk of injury in the stampede.”

China Bond Yields Jump As Investors Head For Exit (MNI)

When everyone heads for the exit at the same time, there’s a risk of injury in the stampede. Chinese bond investors are getting a taste of just how that feels as they scramble to offload their holdings in what could turn out to be a nasty correction. Some investors have already been dumping their government bonds as yields started to rebound from record lows, while others, who only got in recently when yields were around 2.8-2.9%, been holding on in the hope that bond yields will fall back soon. In the secondary market, the yield on the benchmark 10-year Chinese Government Bond (CGB) broke above 3% on Thursday for the first time since early June and was at 2.995% in Friday morning trade, up nearly 15 basis points for the week, the biggest weekly rise since May 2015.

For November as a whole, the yield jumped 8.88%, the biggest monthly gain since October 2010. Treasury futures also plunged this week with March contracts for 10-year CGB and five-year CGB both having their biggest weekly loss since the contracts started trading in June. A Shanghai-based trader with a joint stock bank said he believes the yield on the 10-year CGB could rise as high as 3.2% before falling back. The brutal sell-off has been triggered by a triple whammy – expectations of tighter liquidity conditions and higher inflation on the domestic front, and externally, rising bond yields in the U.S.

A surge in redemptions from worried investors has hit the market hard. One major state-owned bank is said to have redeemed around CNY200 billion from money market funds while the Industrial and Commercial Bank of China, the country’s largest commercial bank, is also said to have told fund managers managing some of its money to cut bonds holdings and stockpile cash in line with ICBC’s own liquidity management. Domestic investors have swarmed over China’s bond market like bees around a honey pot over the last couple of years amid a dearth of more attractive investment opportunities as economic growth slowed. The stock market rout in the summer of 2015 only encouraged investors to move more funds to fixed income products.

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Sounds about right.

China’s ‘Extraordinary Leverage’ Tops BOE List Of Concerns (CNBC)

China, euro zone sovereign debt and the potential fallout from Brexit top the escalating list of concerns for the Bank of England (BOE), according to a report published on Wednesday which warns that risks to global stability have spiked in the past six months. The U.K.’s central bank’s semi-annual Financial Stability Report states, “Vulnerabilities stemming from the global environment and financial markets, which were already elevated, have increased further since July.” China’s burgeoning debt levels and rapid rate of credit expansion are singled out as significant red flags, with the report noting a 100 percentage point spike in the country’s non-financial sector debt relative to GDP since the 2008 financial crisis. The ratio currently stands at around 260% of GDP.

“This is extraordinary leverage for an advanced, let alone, an emerging economy,” the BOE Governor Mark Carney said at a press conference to launch the report. The “near-record” pace of net capital outflows from China during the third quarter and a 3% depreciation in the Chinese renminbi against the U.S. dollar since the publication of the BOE’s July report were also highlighted as reasons for concern. Turning to nearer neighbors, the governor broke down the key risks emanating from some euro area economies into, firstly, existing sovereign debt dynamics and, secondly, threats to the resilience of parts of the trading bloc’s banking system.

Carney noted the vulnerability of elevated sovereign debt levels to a leap in borrowing costs or diminished growth prospects on the back of either trade or political headwinds. Moving even closer to home, the governor raised the looming specter of the U.K.’s impending departure from the EU, noting banks located domestically currently supply over half of the debt and equity issuance from continental firms and account for over 75% of foreign exchange and derivatives activity in the U.K.

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“We” can’t make up our minds about this one. Because our minds are stuck in a bubble.

Do We Want House Prices Up Or Down? (AFR)

Just as market forces were about to push the price of housing down in Australia, the Treasurer stepped in with some new regulation. Phew. Some first home buyer’s nearly snatched a good deal, but luckily the Treasurer was there to protect the property developers from the oversupply their building bonanza created. No issue creates a bigger flood of nonsensical econobabble in Australia than “housing affordability”. It’s a meaningless term engineered for the sole purpose of allowing politicians to pretend they are simultaneously on the side of home buyers and home sellers. What’s remarkable is the willingness of the media and others to play along. Most politicians are adamant that they want petrol, fresh food and health insurance to be less expensive.

We talk about the price of petrol and the price of milk. We don’t talk about “petrol affordability” or “bread affordability” let alone create an index of the price of bread divided by median household income. Talking endlessly about “housing affordability” allows politicians to duck the simple question of whether house prices are “too high”, “too low” or “just right”. The absurdity of this situation was revealed during the federal election campaign when the Coalition attacked the ALP’s plans to reform negative gearing on the basis that such changes would, wait for it, put downward pressure on house prices. Oh, the humanity! The Coalition’s rhetorical solution to the imaginary issue of housing affordability is to reject changes to the tax treatment of investment houses and instead blame environmentalists and state governments for “restricting the supply of housing”.

Of course this week’s redefinition of “second-hand property” by Treasurer Morrison makes a mockery of such a position. Having spent years pretending that increasing the housing supply would make housing “more affordable” the Treasurer has now acted to prevent an increase in apartment supply from pushing apartment prices down. The Coalition playbook makes clear that when it’s not the environmentalists’ fault, it must be the unions’ fault. On cue Malcolm Turnbull recently empathised with the terrible plight of “young Australian couples that can’t afford to buy a house because their costs are being pushed up by union thuggery”. A quick look at the data suggests no such link, but if Donald Trump taught conservatives anything it’s that data is for losers.

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And it should be.

Cash Is Still King In Eurozone – Deutsche (CNBC)

While cash is facing several challenges in the euro area with an increasing number of people moving towards cashless payments and digital banking, the reports of the demise of cash are greatly exaggerated, Deutsche Bank has said in its latest research note. “Cash is facing many challenges in the euro area. The ECB has decided to cease production of the €500 ($532) note due to concerns over its facilitation of illicit activities,” the bank said while adding that the cash in circulation is three times more than what it was in 2003.

While many would attribute this to the never-ending stream of money that the central banks have been pumping into the economy through QE and ultra-low interest rates, Deutsche Bank’s Heike Mai believes that most of the increase in cash since 2008 comes from abroad and hoarders. Cash held outside the euro area was worth €80 billion and cash hoarded domestically by the real economy is estimated to be valued at €120 billion. “There are good reasons to believe that cash won’t disappear anytime soon from the euro area. First, it is debatable that a cashless society would mean less crime,” Mai said, adding, that the ratio of damage caused by card fraud to the value of counterfeit notes in circulation is more than 10 to 1.

“Second, the political value of cash should not be underestimated. Some economies like using cash, for example, Germany, Spain, Italy and Austria. The most robust data protection is provided by cash,” Mai, an economist at Deutsche Bank, said in the note. The research note that focuses on Europe argued that by the end of third-quarter of 2016, euro currency in circulation amounted to €1.1 trillion, three times as much as in the first quarter of 2003. While small-value notes such as €5, €10 and €20 are used to a great extent for day-to-day payments, bigger-value notes such as €50 and €100 are used for both payments and cash hoarding.

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Beware of frozen quicksand. Everyone wants the Pirates to fail.

Iceland Pirate Party To Try To Form Government (BBC)

Iceland’s anti-establishment Pirate Party has been asked by the president to try to form a new government, following October’s snap elections. President Gudni Johannesson made the announcement after talks with Pirates head Birgitta Jonsdottir. The Pirates, who vowed radical reforms, came third in the elections in which no party won an outright majority. Two earlier rounds of coalition talks involving first the Independence Party and then the Left-Greens failed. “Earlier today, I met the leaders of all parties and asked their opinion on who should lead those talks. After that I summoned Birgitta Jonsdottir and handed her the mandate,” President Johannesson said on Friday.

Ms Jonsdottir said afterwards she was “optimistic that we will find a way to work together”. In the elections, the Pirate Party – which was founded in 2012 – more than tripled its seats to 10 in the 63-member parliament. The election was called after Prime Minister Sigmundur Gunnlaugsson quit in April in the wake of the leaked Panama Papers, which revealed the offshore assets of high-profile figures. The Pirates want more political transparency and accountability, free health care, closing tax loopholes and more protection of citizens’ data.

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Color me stunned.

UK Politicians Exempt Themselves From New Wide-Ranging Spying Laws (Ind.)

Politicians have exempted themselves from Britain’s new wide-ranging spying laws. The Investigatory Powers Act, which has just passed into law, brings some of the most extreme and invasive surveillance powers ever given to spies in a democratic state. But protections against those spying powers have been given to MPs. Most of the strongest powers in the new law require that those using them must be given a warrant. That applies to people wanting to see someone’s full internet browsing history, for instance, which is one of the things that will be collected under the new law. For most people, that warrant can be issued by a secretary of state. Applications are sent to senior ministers who can then approve either a targeted interception warrant or a targeted examination warrant, depending on what information the agency applying for the warrant – which could be anyone from a huge range of organisations – wants to see.

But for members of parliament and other politicians, extra rules have been introduced. Those warrants must also be approved by the prime minister. That rule applies not only to members of the Westminster parliament but alos politicians in the devolved assembly and members of the European Parliament. The protections afforded to politicians are actually less than they had hoped to be given. Earlier in the process, the only amendment that MPs had submitted was one that would allow extra safeguards for politicians – forcing any request to monitor MP’s communications to go through the speaker of the House of Commons as well as the prime minister.

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Eric Peters sells cars. And he’s right that cheap credit drives car sales and gadgetry. But not about the need for cars in the first place.

The New American Dream – A Life In Hock (Peters)

We live in a society driven by debt. Cars, for example, have become hugely expensive (even on the low end) relative to what people can afford – because of the easy availability of credit. Which is the nice word used to speak about debt, intended to encourage us to get into it. It takes at least $15,000 or so to drive home in a “cheap” new car, once all is said and done. And the “cheap” car will have to be registered, plated and insured. It runs into money. And most new cars cost a lot more money. Which most people haven’t got. So they get debt. A loan. Which, when it becomes commonly resorted to as a way to live beyond one’s means as a lifestyle, drives up the cost of life for everyone. Including those who try to live within their means – or better yet, below them.

When most people (when enough people) are willing – are eager – to go into hock for the next six years in order to have a car with an LCD touchscreen, leather (and heated) seats, six air bags, a six-speaker stereo, electronic climate control AC and power everything – which pretty much every new car now comes standard with – the car companies build cars to satisfy that artificial demand. Artificial because based on economic unreality. That is a good way to think about debt. It is nonexistent wealth. You are promising to pay with money you haven’t earned yet. And maybe won’t. The car market has become like the housing market – which has also been distorted by debt to a cartoonish degree. The typical new construction home is a mansion by 1960s standards.

Not that there’s anything wrong with living in a mansion. Or driving a car with heated leather seats and climate control AC and a six-speaker surround-sound stereo and six air bags and all the rest of it. Provided you can afford it. Most people can’t. Normally, that fact would keep things in check. There would be mansions, of course – and high-end cars, too. But only for those with the high-end incomes necessary to afford them. Everyone else would live within their means. We wouldn’t be living in this economic Potemkin village that appears prosperous but is in fact an economic Jenga Castle that could collapse at any moment. There would be a lot less pressure to “keep up with the Joneses”… as they head toward bankruptcy and foreclosure.

As society heads that way. Like the housing industry, the car industry has ceased building basic and much less expensive cars because of easy and grotesque debt-financing. Which is tragic. There ought to be (and would be) a huge selection of brand-new cars priced under $10,000 were it not for the ready availability of nonexistent wealth (.e., debt and credit). Cars many people could pay cash for.

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Still waiting for a politican or government to come clean about the Pension Ponzi.

California Pensions Underfunded By $1 Trillion Or $93k Per Household (ZH)

Earlier today the Kersten Institute for Governance and Public Policy highlighted an updated pension study, released by the Stanford Institute for Economic Policy Research, which revealed some fairly startling realities about California’s public pension underfunding levels. After averaging $77,700 per household in 2014, the amount of public pension underfunding for the state of California jumped to a staggering $92,748 per household in 2015. But don’t worry, we’re sure pension managers can grow their way out of the problem…hedge fund returns have been stellar recently, right?

Stanford University’s pension tracker database pegs the market value of California’s total pension debt at $1 trillion or $93,000 per California household in 2015. In 2014, California’s total pension debt was calculated at $77,700 per household, but has increased dramatically in response to abysmal investment returns at California’s public pension funds that hover at or below 0% annual returns.

Looking back to 2008, the underfunding levels of California’s public pension have skyrocketed 157% on abysmal asset returns and growing liabilities resulting from lower discount rates. Perhaps this helps shed some light on why CalPERS is having such a difficult time with what should have been an easy decision to lower their long-term return expectations to 6% from 7.5% (see “CalPERS Weighs Pros/Cons Of Setting Reasonable Return Targets Vs. Maintaining Ponzi Scheme”)…$93k per household just seems so much more “manageable” than $150k.

Oddly enough, California isn’t even the worst off when it comes to pension debt as Alaska leads the pack with just over $110,000 per household. Of course, at this point the question isn’t “if” these ponzi schemes will blow up but rather which one will go first? We have our money on Dallas Police and Fire…

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Oh, there are thousands of reasons.

Why US ‘News’ Media Shouldn’t Be Trusted (Zuesse)

Nassim Nicholas Taleb headlined on November 22nd a devastating takedown of U.S. ‘news’ media and academia, «Syria and the Statistics of War», and he began there by exposing the highly honored Harvard fraud, Dr. Steven Pinker, but then went pretty much through the entire U.S. ‘intellectual’ Establishment, including all of its major ‘news’ media, as being untrustworthy on the part of any intelligent person. (Regarding Professor Pinker specifically, Taleb linked to a scientific paper that Taleb had co-authored, which shredded one of Pinker’s highly honored and biggest-selling books. Taleb and his colleague mentioned there an article that had appeared in Britain’s Guardian raising serious questions about Pinker’s work, and they were here offering statistical proof of the fraudulence of that work.)

The scenario of exposing intellectual fraud is so common: the only reason why it’s not better known among the public is that usually the disproofs of highly honored work have no impact, and fail to dislodge the prejudices that the given established fraud has ‘confirmed’. Another good example of that occurred when the University of Massachusetts graduate student Thomas Herndon issued his proof of the fraudulence of the extremely influential economics paper by Kenneth Rogoff and Carmine Rinehart, «Growth in a Time of Debt», which had been widely cited by congressional Republicans and other conservatives as a main ‘justification’ for imposing draconian economic austerity on the U.S. and other nations during the recovery from the 2008 economic crash.

Years later, that graduate student is still a graduate student (i.e., unemployed), while Kenneth Rogoff remains, as he was prior to his having been exposed: one of Harvard’s most prominent professors of economics, and a member of the Group of 30 — the world’s 30 most influential and powerful economists. Carmen Rinehart likewise retains her position also as a Harvard Professor. Previously, the Harvard Economics Department had guided communist Russia into a crony-capitalist (or fascist) ‘democracy’, but then Vladimir Putin took over Russia and got rid of the worst excesses of Harvard’s «capitalism» and so became hated by the U.S. aristocracy and its ‘news’ media — hated for having tried to establish Russia’s national independence, Russia’s independence from the U.S. aristocracy (which expected, and still craves, to control Russia).

And now after Donald Trump’s victory against the super-neoconservative hater of Russia, Hillary Clinton, the U.S. Establishment, through its voices such as the Washington Post, is trying to smear — like Joseph R. McCarthy smeared America’s non-fascists back in the 1950s — the tiny independent newsmedia that had been reporting truthfully about U.S.-Russian relations and America’s coups and invasions trying to weaken and ultimately to conquer Russia even if that means nuclear war.

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Fake news as far as the eye can see. Next up: Putin eats babies.

Everything You Read About The Wars In Syria And Iraq Could Be Wrong (Ind.)

The Iraqi army, backed by US-led airstrikes, is trying to capture east Mosul at the same time as the Syrian army and its Shia paramilitary allies are fighting their way into east Aleppo. An estimated 300 civilians have been killed in Aleppo by government artillery and bombing in the last fortnight, and in Mosul there are reportedly some 600 civilian dead over a month. Despite these similarities, the reporting by the international media of these two sieges is radically different. In Mosul, civilian loss of life is blamed on Isis, with its indiscriminate use of mortars and suicide bombers, while the Iraqi army and their air support are largely given a free pass. Isis is accused of preventing civilians from leaving the city so they can be used as human shields.

Contrast this with Western media descriptions of the inhuman savagery of President Assad’s forces indiscriminately slaughtering civilians regardless of whether they stay or try to flee. The UN chief of humanitarian affairs, Stephen O’Brien, suggested this week that the rebels in east Aleppo were stopping civilians departing – but unlike Mosul, the issue gets little coverage. One factor making the sieges of east Aleppo and east Mosul so similar, and different, from past sieges in the Middle East, such as the Israeli siege of Beirut in 1982 or of Gaza in 2014, is that there are no independent foreign journalists present. They are not there for the very good reason that Isis imprisons and beheads foreigners while Jabhat al-Nusra, until recently the al-Qaeda affiliate in Syria, is only a shade less bloodthirsty and generally holds them for ransom.

These are the two groups that dominate the armed opposition in Syria as a whole. In Aleppo, though only about 20 per cent of the 10,000 fighters are Nusra, it is they – along with their allies in Ahrar al-Sham – who are leading the resistance. Unsurprisingly, foreign journalists covering developments in east Aleppo and rebel-held areas of Syria overwhelmingly do so from Lebanon or Turkey. A number of intrepid correspondents who tried to do eyewitness reporting from rebel-held areas swiftly found themselves tipped into the boots of cars or otherwise incarcerated.

Experience shows that foreign reporters are quite right not to trust their lives even to the most moderate of the armed opposition inside Syria. But, strangely enough, the same media organisations continue to put their trust in the veracity of information coming out of areas under the control of these same potential kidnappers and hostage takers. They would probably defend themselves by saying they rely on non-partisan activists, but all the evidence is that these can only operate in east Aleppo under license from the al-Qaeda-type groups.

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Could get tricky for Trump. Luckily for him, there’s still 7 weeks to go until January 20.

US Veterans Build Barracks For Pipeline Protesters In Cold (R.)

U.S. military veterans were building barracks on Friday at a protest camp in North Dakota to support thousands of activists who have squared off against authorities in frigid conditions to oppose a multibillion-dollar pipeline project near a Native American reservation. Veterans volunteering to be human shields have been arriving at the Oceti Sakowin camp near the small town of Cannon Ball, where they will work with protesters who have spent months demonstrating against plans to route the Dakota Access Pipeline beneath a lake near the Standing Rock Sioux Reservation, organizers said. The Native Americans and protesters say the $3.8 billion pipeline threatens water resources and sacred sites.

Some of the more than 2,100 veterans who signed up on the Veterans Stand for Standing Rock group’s Facebook page are at the camp, with hundreds more expected during the weekend. Tribal leaders asked the veterans, who aim to form a wall in front of police to protect the protesters, to avoid confrontation with authorities and not get arrested. Wesley Clark Jr, a writer whose father is retired U.S. Army General Wesley Clark, met with law enforcement on Friday to tell them that potentially 3,500 veterans would join the protest and the demonstrations would be carried out peacefully, protest leaders said. The plan is for veterans to gather in Eagle Butte, a few hours away, and then travel by bus to the main protest camp, organizers said, adding that a big procession is planned for Monday.

[..] The protesters’ voices have also been heard by companies linked to the pipeline, including banks that protesters have targeted for their financing of the pipeline. Wells Fargo said in a Thursday letter it would meet with Standing Rock elders before Jan. 1 “to discuss their concerns related to Wells Fargo’s investment” in the project. There have been violent confrontations near the route of the pipeline with state and local law enforcement, who used tear gas, rubber bullets and water hoses on the protesters, even in freezing weather. The number of protesters in recent weeks has topped 1,000. State officials on Monday ordered them to leave the snowy camp, which is on U.S. Army Corps of Engineers land, citing harsh weather, but on Wednesday they said they would not enforce the order. “There is an element there of people protesting who are frightening,” North Dakota Attorney General Wayne Stenehjem said on Thursday. “It’s time for them to go home.”

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